Dynagas LNG Partners LP · NYSE:DLNG
Dynagas LNG Partners LP — Q2 2018 Earnings Presentation
23 slides from Dynagas LNG Partners LP's earnings presentation, Jul 27, 2018
Slide 1: Q2 2018 Financial Results Presentation
s Q2 2018 Financial Results Presentation 27 July 2018
Slide 2: Forward Looking Statements and Disclaimer
Forward Looking Statements and Disclaimer This presentation contains certain statements that may be deemed to be “forward-looking statements” within the meaning of applicable federal securities laws. All statements included in this presentation which are not historical or current facts (including ou
Slide 3: Forward Looking Statements and Disclaimer
Forward Looking Statements and Disclaimer In addition, unpredictable or unknown factors herein also could have material adverse effects on forward-looking statements. Please read the Partnership’s filings with the Securities and Exchange Commission for more information regarding these factors and th
Slide 4: Recent Developments
Recent Developments Fleet Commercial Update April 2018: The Ob River multiyear charter contract with Gazprom matured and the vessel subsequently commenced employment under a ten-year term charter party with the same charterer. May 2018: Arctic Aurora completed her scheduled 5 year class special surv
Slide 5: Q2'18 Financial Highlights
Q2’ 18 Financial Highlights USD in thousands (except per unit, average daily hire and other operational data) Q2 2018 Q1 2018 Q2 2017 Revenues 30,892 33,904 31,975 Adjusted Net Income (1) 4,526 7,232 4,220 Adjusted EBITDA (1) 24,443 26,590 22,921 Distributable Cash Flow (1) 8,670 11,286 8,200 Annual
Slide 6: Distributable Cash Flow and Contract Backlog
Distributable Cash Flow and Contract Backlog Backlog Quarterly Adjusted EBITDA Quarterly Distributable Cash Flow Quarterly Distribution Common Units Lena River Drop Reduction in charter income of Yenisei River ($) Billion Yenisei River Down: Distribution Unchanged. and Lena River due to ($) Million
Slide 7: Distributable Cash Flow and Cash Coverage Ratio
Distributable Cash Flow and Cash Coverage Ratio (USD in thousands) Q2’ 18 Distribution Coverage Q2’ 18 Cash Coverage Net income 351 Net income 351 Depreciation 7,563 Depreciation 7,563 Amortization of deferred financing fees 814 Amortization of deferred financing fees 814 Net interest and finance co
Slide 8: Simplified Capital Structure and Debt Profile
Simplified Capital Structure and Debt Profile ($) millions 1,000 800 Net Debt to Total Capitalization 65% 600 Net Debt to LTM EBITDA 6.4x ~ USD 1 $475 million Billion Market $88 million of available liquidity 400 TLB Value of $ 75m Preferred Vessels Non amortizing 6.25% USD 250 million 200 $ 283m se
Slide 9: Fleet Profile
Fleet Profile Fleet 6 LNG carriers 914,100 cbm (149,700 cbm for steam turbine LNG fleet, 155,000 cbm for the tri-fuel Total cbm capacity diesel engine LNG fleet (TFDE’s)) Fleet average age ~8.0 years(1) Average remaining charter duration ~10.1 years(1)(2) Gazprom, Equinor, Yamal Counterpar
Slide 10: Long Term Contracts Provide Stable, Visible Cash Flows
Long Term Contracts Provide Stable, Visible Cash Flows L NG Carrier Year Capacity Name Built (cbm) Charterer 2018 2019 2020 2021 2022 Clean 2007 149,700 2026 Energy Ob River 2007 149,700 2028 (1) Am ur 2028 2008 149,700 River (1) Arctic 2013 155,000 2023 Aurora Yenis ei 2013 155,000 2033/34 River L
Slide 11: Dropdown Opportunities
Dropdown Opportunities All LNG carriers are chartered on long-term contracts, providing multi-billion dollar contract backlog The Sponsor is a critical partner to Novatek, Total and CNPC The Sponsor and DLNG together account for 11 out of 27 ships contracted to Yamal LNG Carrier Capacity Firm
Slide 12: Market Share: Leader in Ice Class Trades
Market Share: Leader in Ice Class Trades Dynagas Group (DLNG and Sponsor) has an 82% market share of the vessels with ice class 1A FS or equivalent notations Limited vessel supply creates sublet opportunities for clients (Gazprom Sakhalin) First and only LNG shipping company to sail through
Slide 13: Industry Overview
Industry Overview
Slide 14: Composition of the LNG Fleet & Orderbook
Composition of the LNG Fleet & Orderbook 1. Existing Fleet LNG Fleet by Propulsion Type (Existing plus Orderbook) • Number of vessels: 509 # of Vessels # of % Average Existing Fleet Vessels of Fleet Age 185 -266,000 m3 46 13% 9 10,585,300 167- 185,000 m3 105 23% 2 18,207,120 150- 167,500 m3 127 25%
Slide 15: LNG Trade to increase by over 40% by 2022
LNG Trade to increase by over 40% by 2022 Global LNG Supply / Exports by Region, 2012-2022 Global LNG trade reached 292 mt in 2017, up 11% from 2016 +41% Over the next 5 years LNG supply is projected to rise by 5-Year 118 mt or 41% (new projects and existing projects ramping +22% Growth up capacity)
Slide 16: LNG Trade up 8% 1H 18 versus 1H 17
LNG Trade up 8% 1H 18 versus 1H 17 Total LNG exports reached 152.7 mt in the first half of 2018, up 8% Incremental LNG Exports by Region, 1H 18 vs 1H 17 (mill tons) from the first half of 2017 • LNG export projects in Australia, Russia and the U.S. produced a total of 48.9 mt in the first half of 20
Slide 17: Asia keeps driving LNG Demand Growth
Asia keeps driving LNG Demand Growth Behind Japan, China remains the second largest importer of LNG Incremental LNG Imports by Region, 1H 18 vs 1H 17 (mill tons) with 22.4 mt for the first half of 2018 up 6.7 mt from 1H 2017 followed closely by South Korea with 21.9 mt (up 3.0 mt) • Demand growth wa
Slide 18: U.S. Export Trading Patterns – Q2 2018
U.S. Export Trading Patterns – Q2 2018 Recent trading patterns1 from U.S. exports that delivered in Q2 Importers from Sabine Pass (LNG tonnes) – Q2 2018 2018 indicate that 1.91 vessels (160,000 m3) are required on average for each million tonne of LNG exported • 66 cargoes from Sabine Pass and 9 car
Slide 19: Liquidity in The LNG Charter Market Continues to Grow
Liquidity in The LNG Charter Market Continues to Grow Annual Fixtures by Charter Length Fixture activity in the LNG charter market continues to increase. • Spot chartering activity (<180 days) has continued to make up a growing proportion of the charter market, accounting for ~89% of fixtures over 2
Slide 20: Key Investment Highlights
Key Investment Highlights DLNG is a low risk, pure play LNG marine transportation MLP provides attractive risk-adjusted returns for unitholders Purified Asset Mix: Pure Play LNG marine transportation MLP Compelling Market Fundamentals: Fixed Rate Contracts Strong Growth in LNG production Simplified
Slide 21: Appendix
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Slide 22: Reconciliation of net income/(loss) to Adjusted Net Income and Adjusted EPS
Reconciliation of net income/(loss) to adjusted Net Income and Adjusted Earnings per Common Unit Three Months Ended (In thousands of U.S. Dollars, except for units and per unit data) 30 June 2018 2017 Net income/ (loss) $ 351 $ (5,181) Non cash expense from accelerated amortization of deferred loan
Slide 23: Reconciliation of Net Income/(loss) to Adjusted EBITDA
Reconciliation of Net Income/(loss) to Adjusted EBITDA 1 Three Months Ended Reconciliation to Net Income 30 June (In thousands of U.S dollars) 2018 2017 Net income/ (loss) $ 351 $ (5,181) Net interest and finance costs 12,354 13,725 Depreciation 7,563 7,559 Class survey costs 2,229 4,911 Amortizatio