GasLog Ltd. and its subsidiaries (“GasLog”, “Group” or
“Company”) (NYSE: GLOG), an international owner, operator
and manager of liquefied natural gas (“LNG”) carriers, today
reported its financial results for the quarter and the year ended
December 31, 2018.
Highlights of the Quarter and the Year
• |
Record quarterly
Revenues, Profit, Earnings per share(1), record EBITDA(2), record
Adjusted EBITDA(2), record Adjusted Profit(2) and record Adjusted
Earnings per share(1)(2) of $188.6 million, $30.4 million, $0.14,
$145.0 million, $145.0 million, $62.5 million and $0.54,
respectively. |
• |
Record annual Revenues,
record Profit, Earnings per share(1), record EBITDA(2), record
Adjusted EBITDA(2), record Adjusted Profit(2) and Adjusted Earnings
per share(1)(2) of $618.3 million, $126.4 million, $0.47, $447.5
million, $447.7 million, $134.8 million and $0.57,
respectively. |
• |
Highest ever quarterly
net pool performance from our vessels trading in the spot market
under the LNG carrier pooling agreement (the “Cool Pool”) following
a significant increase in LNG shipping spot rates and
utilization. |
• |
Signed two seven-year
charter parties with a wholly-owned subsidiary of Cheniere Energy,
Inc. (“Cheniere”), for two newbuild LNG carriers. The vessels,
180,000 cubic meter (“cbm”) LNG carriers with dual fuel two stroke
engine propulsion (“LP-2S”) and GTT Mark III Flex Plus containment
systems, were ordered from Samsung Heavy Industries Co., Ltd.
(“Samsung”) and are scheduled for delivery in the second and third
quarters of 2021. |
• |
Completed the sale of
the Methane Becki Anne to GasLog Partners LP (“GasLog Partners” or
the “Partnership”) for $207.4 million on November 14, 2018 with
attached multi-year charter to a subsidiary of Royal Dutch Shell
plc (“Shell”). |
• |
GasLog Partners
completed a public offering of 8.500% Series C Cumulative
Redeemable Perpetual Fixed to Floating Rate Preference Units (the
“Partnership’s Series C Preference Units”), raising gross proceeds
of $100.0 million and net proceeds of $96.3 million. |
• |
Modified the
Partnership Agreement with GasLog Partners to reduce GasLog’s
incentive distribution rights (“IDRs”) on quarterly distributions
above $0.5625 per unit from 48% to 23% and waive IDRs on assets or
businesses acquired by the Partnership from third parties in
exchange for a cash consideration of $25.0 million. |
• |
Special dividend of
$0.40 per common share paid on December 17, 2018. |
• |
Quarterly dividend of
$0.15 per common share payable on March 14, 2019, an increase of
7.1% over the fourth quarter of 2017. |
• |
Announced share
repurchase programme of up to $50.0 million. |
(1) Earnings/(loss) per share (“EPS”) and Adjusted EPS are net
of the profit attributable to the non-controlling interests of
$16.6 million and the dividend on preferred stock of $2.5 million
for the quarter ended December 31, 2018 ($20.8 million and $2.5
million, respectively, for the quarter ended December 31, 2017) and
net of the profit attributable to the non-controlling interests of
$78.7 million and the dividend on preferred stock of $10.1 million
for the year ended December 31, 2018 ($68.7 million and $10.1
million, respectively, for the year ended December 31, 2017).
(2) EBITDA, Adjusted EBITDA, Adjusted Profit and Adjusted
EPS are non-GAAP financial measures and should not be used in
isolation or as a substitute for GasLog’s financial results
presented in accordance with International Financial Reporting
Standards (“IFRS”). For the definitions and reconciliations of
these measures to the most directly comparable financial measures
calculated and presented in accordance with IFRS, please refer to
Exhibit II at the end of this press release.
CEO Statement
Paul Wogan, Chief Executive Officer, stated: “GasLog delivered
another set of record results in the fourth quarter of 2018 driven
in large part by very strong earnings from our spot vessels against
a backdrop of extreme tightness in the LNG shipping market. These
spot earnings, combined with our fleet growth during the year, our
strong operational performance and strict cost control, delivered
record annual results for Revenues, EBITDA and Profit and allowed
us both to increase our common dividend by 7.1% and to declare our
first special dividend in November.
During 2018, we continued to execute our growth strategy. We
announced seven newbuild orders, six of which are committed to
long-term charters, four with Cheniere and two with a wholly owned
subsidiary of Centrica plc (“Centrica”). We are very pleased to
continue to develop and strengthen our relationship with these two
important customers.
GasLog Partners issued over $320.0 million of new equity in
2018, of which over $200.0 million was recycled to GasLog as
consideration for the two dropdowns and the modification of the
IDRs which will permanently reduce the Partnership’s expected cost
of capital. The equity recycled to GasLog and our declining
leverage mean that we are well placed to fund our newbuild vessels
under construction.
The continued growth of our fleet, the improvement in spot
earnings and our cost control measures mean we have made
significant progress towards meeting our target of more than
doubling consolidated annualized EBITDA over the 2017-2022
period.
While spot rates have recently moderated from fourth quarter
peaks, in line with historical seasonal trends, we expect tightness
in LNG shipping markets to return given forecast LNG supply growth
through 2020 and relatively few uncommitted newbuild vessels
delivering in that period.
As we look beyond 2020, additional shipping capacity will be
required if consensus LNG demand and supply forecasts are realized.
However, whilst we now believe that the LNG shipping market is
heading towards a balanced state early next decade, the long-term
secular growth of LNG supply and demand mean that, over the medium
and long-term, GasLog will continue to serve a dynamic and growing
industry.
LNG Market Update and Outlook
LNG demand, as estimated by Wood Mackenzie, is expected to have
increased by 9%, from 288 million tonnes per annum (“mtpa”) in 2017
to 313 mtpa in 2018. According to China’s General Administration of
Customs, China’s LNG imports increased by approximately 16 mtpa, or
41%, to 54 mtpa in 2018, driven mainly by continued coal-to-gas
switching in the industrial, commercial and residential sectors.
South Korea, Pakistan, Thailand and Mexico also experienced strong
growth in LNG imports during 2018. The outlook remains robust, with
Wood Mackenzie forecasting compound annual growth in global LNG
demand of 6% between 2018 and 2025. This growth is expected to be
broad-based, with Wood Mackenzie forecasting that South East Asia
and Europe will account for approximately 70% of the 148 mtpa net
increase in demand between 2018 and 2025.
According to Wood Mackenzie, global LNG supply in 2018 totaled
326 million tonnes (“mt”), or a 9% increase on 2017. Several new
LNG supply projects and the ramp-up of existing facilities
contributed to the increase in LNG production in 2018. During the
year, new production started in the United States (Cove Point,
Corpus Christi Train 1 and Sabine Pass Train 5), Australia
(Wheatstone Train 2, Ichthys), Russia (Yamal Trains 2 & 3) and
Cameroon Floating LNG. Supply from existing liquefaction facilities
in Egypt, Trinidad and Tobago and Oman also increased following
successful efforts to raise domestic gas production. Downtime at
existing facilities in Malaysia and Russia partially offset these
gains.
Based on Wood Mackenzie’s current forecasts, 2019 is anticipated
to be the strongest year ever for supply growth in the LNG market,
with supply expected to increase by 40 mtpa to 366 mtpa, a 12%
increase on 2018. This includes new LNG production from Elba
Island, Cameron, Freeport and Corpus Christi Train 2 in the United
States, the Prelude floating LNG project offshore Australia,
further increases in Russia’s output and the continued ramp-up of
projects which were brought onstream in 2018.
During 2018, three new LNG liquefaction projects reached Final
Investment Decision (“FID”), underpinning further LNG supply growth
during the next decade. LNG Canada (14 mtpa) in western Canada,
Corpus Christi Train 3 (4.5 mtpa) in the United States and the
Greater Tortue Ahmeyim project offshore Mauritania and Senegal (2.5
mtpa) were all approved during the year. In February 2019, the
Golden Pass (16 mtpa) project in the United States also reached
FID. According to Wood Mackenzie, proposed projects (including
Golden Pass) in the United States with a combined capacity of
approximately 35 mtpa are expected to gain investment approval in
2019. Outside the United States, Qatar is aiming to take FID on an
expansion of existing facilities from 77 to 110 mtpa. New projects
offshore Mozambique (28 mtpa) and the Arctic LNG-2 project (20
mtpa) in Russia are also expected by Wood Mackenzie to be approved
in 2019.
In parallel with the progress on new supply FIDs, in 2018 there
was a significant increase in the number of announced long-term LNG
off-take contracts. According to Wood Mackenzie and company
disclosures, 95 mtpa of long-term (defined as greater than 5 years’
duration) off-take commitments have been agreed since the beginning
of 2018, compared to 25 mtpa in 2017. The nature of the LNG
marketplace also continued to evolve. According to the Financial
Times, the top three independent commodity traders increased their
delivered LNG volumes by almost 40% to 31 mt in 2018, taking market
share from traditional participants such as national oil companies
and major integrated oil and gas companies.
In the LNG shipping spot market, tri-fuel diesel electric
(“TFDE”) headline rates, as reported by Clarksons, averaged $89,000
per day in 2018, a 93% increase on 2017 levels. Headline TFDE rates
rose significantly in the fourth quarter of 2018 and reached
all-time highs of $190,000 per day in November 2018 following a
marked decrease in spot ship availability. Average headline TFDE
rates in the fourth quarter of 2018 were $150,000 per day. Headline
rates for steam propulsion (“Steam”) vessels also reached
multi-year highs of $98,000 per day in late 2018. In recent weeks
however, relatively mild winter weather and ample inventory levels
in key Asian markets have resulted in falling Asian LNG prices,
reducing the incentive to move LNG cargoes from the Atlantic to the
Pacific Basin and resulting in a seasonal rise in prompt vessel
availability and falling spot rates. Headline TFDE spot rates are
currently assessed at $60,000 per day. Notwithstanding this recent
fall and the likelihood of continued seasonality in the spring
shoulder months, we continue to believe that the medium-term
outlook for spot rates through 2019 and 2020 is positive given
supportive LNG commodity fundamentals and LNG shipping supply and
demand. However, spot rates may be prone to further periods of
seasonality and volatility similar to that seen in 2018.
During 2018 there was a significant increase in term chartering
activity. Based on Poten data, charters between 181 days to seven
years duration increased to 19% of total fixtures in 2018, from 5%
in 2017. Our expectation of structural tightness in the LNG carrier
market, combined with increasing spot vessel availability, could
result in this trend continuing in 2019 and beyond.
According to Poten, there were 61 orders for dedicated LNG
carrier newbuilds in 2018, an all-time high. The orderbook now
totals 105 dedicated LNG carriers (>100,000 cbm), of which 63%
are backed by long-term contracts. The positive outlook for LNG
commodity and LNG shipping markets, as well as historically low
newbuild prices, resulted in both existing LNG carrier owners and
new entrants ordering new vessels. Based on 2018 newbuilding orders
and current forecasts of LNG supply growth, we now believe that the
LNG shipping market is heading towards a balanced state early next
decade. As such, the requirement for additional shipping capacity
in this period has now been largely addressed. This implies that
newbuilding order activity in 2019 needs to slow relative to 2018
levels in order to reduce the risk of vessel oversupply.
Completion of the Sale of the Methane
Becki Anne
On November 14, 2018, GasLog completed the sale of 100% of the
ownership interest in GAS-twenty seven Ltd., the entity which owns
the Methane Becki Anne, to GasLog Partners for an aggregate
purchase price of $207.4 million, which includes $1.0 million for
positive net working capital.
GasLog Partners’ Issuance of Series C Preference
Units
On November 15, 2018, GasLog Partners completed a public
offering of 4,000,000 8.500% Series C Preference Units, liquidation
preference $25.00 per unit, at a price to the public of $25.00 per
preference unit. The net proceeds from the offering after deducting
underwriting discounts, commissions and other offering expenses
were $96.3 million. The Partnership’s Series C Preference Units are
listed on the New York Stock Exchange under the symbol “GLOP PR C”.
The initial distribution on the Partnership’s Series C Preference
Units will be payable on March 15, 2019.
IDRs Modification
On November 27, 2018, GasLog and GasLog Partners entered into an
agreement to modify the partnership agreement with respect to
GasLog’s IDRs. The modification reduces GasLog’s IDRs on quarterly
distributions above $0.5625 per unit from 48% to 23%. GasLog has
further agreed to waive IDR payments resulting from any asset or
business acquired by GasLog Partners from a third party. In
exchange for these modifications, the Partnership paid $25.0
million to GasLog which was sourced from available cash.
Share Repurchase Programme
On November 28, 2018, the board of directors of GasLog
authorized a share repurchase programme of up to $50.0 million
covering the period from January 1, 2019 to December 31, 2021.
Under the terms of the repurchase programme, we may repurchase
common shares from time to time, at our discretion, on the open
market or in privately negotiated transactions. Any repurchases are
subject to market conditions, applicable legal requirements and
other considerations. We are not obligated under the repurchase
programme to repurchase any specific dollar amount or number of
common shares and the repurchase programme may be modified,
suspended or discontinued at any time or never utilized. Any common
shares repurchased by us under the programme will be held in
treasury. As of February 14, 2019, GasLog has not purchased any
shares.
Additional Vessels and New Charter
Agreements
On December 26, 2018, GasLog announced the order of two 180,000
cbm LNG carriers (Hull Nos. 2311 and 2312) with LP-2S propulsion
and GTT Mark III Flex Plus containment systems from Samsung that
are scheduled to be delivered in the second and third quarters of
2021. The vessels will be chartered to Cheniere for a firm period
of seven years pursuant to an option for the charter of one or two
additional newbuild vessels negotiated in 2018.
GasLog Partners’ ATM
Programme
On May 16, 2017, GasLog Partners commenced an ATM Programme
under which the Partnership may, from time to time, raise equity
through the issuance and sale of new common units having an
aggregate offering value of up to $100.0 million in accordance with
the terms of an equity distribution agreement entered into on the
same date. Citigroup Global Markets Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Credit Suisse Securities (USA) LLC
and Morgan Stanley & Co. LLC agreed to act as sales agents. On
November 3, 2017, the size of the ATM Programme was increased to
$144.0 million and UBS Securities LLC was included as a sales
agent.
In the fourth quarter of 2018, GasLog Partners issued and
received payment for an additional 259,104 common units at a
weighted average price of $24.06 per common unit for total gross
proceeds of $6.2 million and net proceeds of $6.0 million.
Since the commencement of the ATM Programme through December 31,
2018, GasLog Partners has issued and received payment for a total
of 5,291,304 common units, with cumulative gross proceeds of $123.4
million at a weighted average price of $23.33 per unit. As of
December 31, 2018, the cumulative net proceeds were $121.2
million.
Alexandroupolis Project
Update
In early January 2019, Gastrade S.A. (“Gastrade”) announced the
successful completion of the first phase of the solicitation of
commitments to take capacity in the project (the “Market Test”),
with 20 companies submitting a non-binding Expression of Interest
for a total of up to 12.2 billion cubic metres (“bcm”) a year of
regasification capacity from the Alexandroupolis FSRU. The
non-binding phase of the Market Test surpassed the 5.5 bcm/year
technical capacity of the project. Planning for the binding phase
of the Market Test is well advanced.
Gastrade also announced in January 2019 that the deadline for
the initial phase of the procurement of the Alexandroupolis FSRU
had been extended to February 15, 2019. Gastrade is targeting FID
in mid-2019; however, this timetable assumes significant near-term
progress on critical path items, including decisions by various
regulatory bodies.
DEPA, the Greek state natural gas utility, and Bulgartransgaz,
the Bulgarian national gas transmission system operator, continue
to work towards the formalisation of their respective shareholdings
in Gastrade.
Dividend Declarations
On November 15, 2018, the board of directors declared a dividend
on the Series A Preference Shares of $0.546875 per share, or $2.5
million in aggregate, payable on January 2, 2019 to holders of
record as of December 31, 2018. GasLog paid the declared dividend
to the transfer agent on December 31, 2018.
On November 28, 2018, the board of directors declared a special
dividend of $0.40 per common share, or $32.3 million in aggregate,
which was paid on December 17, 2018.
On February 13, 2019, the board of directors declared a
quarterly cash dividend of $0.15 per common share, or $12.1 million
in aggregate, payable on March 14, 2019 to shareholders of record
as of March 4, 2019.
Financial Summary
Amounts
in thousands of U.S. dollars |
|
For the three months ended |
|
For the year ended |
|
|
December 31, 2017 |
|
December
31, 2018 |
|
December
31, 2017 |
|
December
31, 2018 |
|
Revenues |
|
$ |
135,772 |
|
$ |
188,644 |
|
$ |
525,229 |
|
$ |
618,344 |
|
EBITDA(1) |
|
$ |
89,655 |
|
$ |
144,982 |
|
$ |
355,902 |
|
$ |
447,511 |
|
Adjusted EBITDA(1) |
|
$ |
89,666 |
|
$ |
145,026 |
|
$ |
356,048 |
|
$ |
447,747 |
|
Profit |
|
$ |
29,685 |
|
$ |
30,384 |
|
$ |
84,209 |
|
$ |
126,398 |
|
Adjusted Profit(1) |
|
$ |
21,438 |
|
$ |
62,517 |
|
$ |
78,724 |
|
$ |
134,845 |
|
Profit attributable to
the owners of GasLog |
|
$ |
8,934 |
|
$ |
13,785 |
|
$ |
15,506 |
|
$ |
47,683 |
|
EPS, basic |
|
$ |
0.08 |
|
$ |
0.14 |
|
$ |
0.07 |
|
$ |
0.47 |
|
Adjusted EPS(1) |
|
$ |
(0.02 |
) |
$ |
0.54 |
|
$ |
(0.00 |
) |
$ |
0.57 |
|
(1) EBITDA, Adjusted EBITDA, Adjusted Profit and Adjusted EPS
are non-GAAP financial measures and should not be used in isolation
or as a substitute for GasLog’s financial results presented in
accordance with IFRS. For definitions and reconciliations of these
measurements to the most directly comparable financial measures
calculated and presented in accordance with IFRS, please refer to
Exhibit II at the end of this press release.
There were 2,317 and 9,030 operating days for the quarter and
the year ended December 31, 2018, respectively, as compared to
2,050 and 8,317 operating days for the quarter and the year ended
December 31, 2017, respectively. The increase in operating days
resulted mainly from the deliveries of the GasLog Houston, the
GasLog Hong Kong and the GasLog Genoa on January 8, 2018, March 20,
2018 and March 29, 2018, respectively, partially offset by certain
non-operating days for the vessels not operating under a long-term
time charter and the off-hire days for four dry-dockings in 2018
(the GasLog Santiago, the GasLog Sydney, the GasLog Skagen and the
GasLog Seattle), as opposed to only one dry-docking in 2017 (the
GasLog Shanghai).
Revenues were $188.6 million and $618.3 million for the quarter
and the year ended December 31, 2018, respectively ($135.8 million
and $525.2 million for the quarter and the year ended December 31,
2017, respectively). The increase was mainly driven by the new
deliveries in our fleet (the GasLog Houston, the GasLog Hong Kong
and the GasLog Genoa) and the increased revenues from vessels
operating in the spot market due to the significant increase in LNG
shipping spot rates during the year as a whole and the fourth
quarter in particular, partially offset by a decrease due to the
expiration of the initial time charters of the GasLog Shanghai, the
GasLog Santiago and the GasLog Sydney and the increase in off-hire
days due to dry-dockings in 2018.
GasLog recognized gross revenues and gross voyage expenses and
commissions of $57.9 million and $2.4 million, respectively, from
the operation of its vessels in the Cool Pool during the quarter
ended December 31, 2018 ($14.5 million and $3.6 million for the
quarter ended December 31, 2017, respectively) and $102.3 million
and $10.2 million, respectively, from the operations of its
vessels in the Cool Pool during the year ended December 31, 2018
($38.0 million and $9.1 million for the year ended December 31,
2017, respectively). Net pool allocation was negative $1.7 million
and positive $17.8 million for the quarter and the year ended
December 31, 2018, respectively (positive $3.9 million and $7.3
million for the quarter and the year ended December 31, 2017,
respectively). The variances were attributable to the movement in
the adjustment of the net pool results generated by the GasLog
vessels in accordance with the pool distribution formula for the
total fleet of the pool. The increase in GasLog’s total net pool
performance during the quarter and year ended December 31, 2018
compared to the quarter and year ended December 31, 2017 was driven
by higher spot rates and higher utilization achieved by all vessels
trading in the Cool Pool. GasLog’s total net pool performance is
presented below:
Amounts
in thousands of U.S. dollars |
|
For the three months ended |
|
For the year ended |
|
|
December 31, 2017 |
|
December
31, 2018 |
|
December
31, 2017 |
|
December
31, 2018 |
|
Pool gross revenues
(included in Revenues) |
|
$ |
14,522 |
|
$ |
57,854 |
|
$ |
38,046 |
|
$ |
102,253 |
|
Pool gross voyage
expenses and commissions (included in Voyage expenses and
commissions) |
|
|
(3,580 |
) |
|
(2,385 |
) |
|
(9,122 |
) |
|
(10,154 |
) |
GasLog’s adjustment for
net pool allocation (included in Net pool allocation) |
|
|
3,893 |
|
|
(1,675 |
) |
|
7,254 |
|
|
17,818 |
|
GasLog’s total
net pool performance |
|
$ |
14,835 |
|
$ |
53,794 |
|
$ |
36,178 |
|
$ |
109,917 |
|
Voyage expenses and commissions were $3.6 million and $20.4
million for the quarter and the year ended December 31, 2018,
respectively ($5.2 million and $15.4 million for the quarter and
the year ended December 31, 2017, respectively). The decrease for
the quarter ended December 31, 2018 as compared to the quarter
ended December 31, 2017 was mainly attributable to a decrease in
bunkers consumed due to the increased utilization of our vessels in
the spot market. The year-on-year increase resulted mainly from the
increased bunkers consumed during certain off-charter and off-hire
days.
Vessel operating and supervision costs were $29.1 million and
$128.1 million for the quarter and the year ended December 31,
2018, respectively ($35.6 million and $122.5 million for the
quarter and the year ended December 31, 2017, respectively). The
decrease for the quarter ended December 31, 2018 as compared to the
quarter ended December 31, 2017 was mainly attributable to a
decrease in technical and maintenance expenses, as well as a
decrease in tonnage tax and insurance costs. The year-on-year
increase was mainly attributable to the deliveries of the GasLog
Houston, the GasLog Hong Kong and the GasLog Genoa earlier in 2018,
resulting in increased crew costs, partially offset by a decrease
in tonnage tax.
General and administrative expenses were $9.7 million and $42.0
million for the quarter and the year ended December 31, 2018,
respectively ($9.6 million and $39.9 million for the quarter and
the year ended December 31, 2017, respectively). The
year-on-year increase was mainly attributable to an increase in
employee costs due to the unfavorable movement of the USD against
the EUR and the British Pound (we have entered into forward foreign
exchange contracts to hedge economically part of this exposure and
the associated realized (losses)/gains are recorded in Gain/(loss)
on the derivatives line, which is discussed below).
Depreciation was $39.5 million and $153.2 million for the
quarter and the year ended December 31, 2018, respectively ($34.6
million and $137.2 million for the quarter and the year ended
December 31, 2017, respectively). The increase resulted from the
deliveries of the GasLog Houston, the GasLog Hong Kong and the
GasLog Genoa on January 8, 2018, March 20, 2018 and March 29, 2018,
respectively. Financial costs were $44.1 million and
$166.6 million for the quarter and the year ended December 31,
2018, respectively ($34.9 million and $139.2 million for the
quarter and the year ended December 31, 2017, respectively). The
increase was attributable to the increased weighted average debt
outstanding as a result of the debt drawdowns for the vessels
delivered in 2018 and the increased weighted average interest rate
deriving from the upward movement of the USD London Interbank
Offered Rate (“LIBOR”) rates. An analysis of the financial costs is
set out below.
(All amounts expressed in thousands of U.S.
dollars) |
|
For the three months ended |
|
For the year ended |
|
|
December 31, 2017 |
|
December
31, 2018 |
|
December
31, 2017 |
|
December
31, 2018 |
|
Financial
costs |
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of
deferred loan/ bond issuance costs |
|
$ |
(3,063 |
) |
$ |
(3,210 |
) |
$ |
(12,398 |
) |
$ |
(12,593 |
) |
Interest expense on
loans |
|
|
(21,132 |
) |
|
(30,269 |
) |
|
(85,813 |
) |
|
(111,600 |
) |
Interest expense on
bonds and realized loss on cross-currency swaps (“CCS”) |
|
|
(7,588 |
) |
|
(7,588 |
) |
|
(27,085 |
) |
|
(30,029 |
) |
Finance lease
charge |
|
|
(2,708 |
) |
|
(2,617 |
) |
|
(10,875 |
) |
|
(10,520 |
) |
Loss arising on bond
repurchase at a premium |
|
|
— |
|
|
— |
|
|
(1,459 |
) |
|
— |
|
Other financial
costs |
|
|
(379 |
) |
|
(438 |
) |
|
(1,551 |
) |
|
(1,885 |
) |
Total |
|
$ |
(34,870 |
) |
$ |
(44,122 |
) |
$ |
(139,181 |
) |
$ |
(166,627 |
) |
Loss on derivatives was $32.4 million and $6.1 million for the
quarter and the year ended December 31, 2018, respectively ($8.6
million and $2.0 million gain for the quarter and the year ended
December 31, 2017, respectively). The decrease in gain on
derivatives in the fourth quarter of 2018, as compared to the
fourth quarter of 2017, is mainly attributable to a decrease of
$40.7 million in gain from mark-to-market valuation of our
derivative financial instruments carried at fair value through
profit or loss, derived mainly from changes in the LIBOR curve as
well as modifications of the Group’s interest rate swap portfolio
that includes interest rate swap agreements with maturities out to
2028, and a net decrease of $0.4 million in realized gain on
derivatives. The year-on-year decrease in gain on derivatives is
mainly attributable to a decrease of $18.5 million in gain from
mark-to-market valuation of our derivative financial instruments
carried at fair value through profit or loss, partially offset by a
decrease of $6.2 million in realized loss on derivatives and the
decrease of $4.4 million in recycled loss of cash flow hedges
reclassified to profit or loss. An analysis of gain on derivatives
is set out below:
(All amounts expressed in thousands of U.S.
dollars) |
|
For the three months ended |
|
For the year ended |
|
|
December 31, 2017 |
|
December
31, 2018 |
|
December
31, 2017 |
|
December
31, 2018 |
|
Gain/(loss) on
derivatives |
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized gain/(loss) on
derivatives held for trading |
|
$ |
(1,650 |
) |
$ |
828 |
|
$ |
(7,842 |
) |
$ |
1,893 |
|
Realized (loss)/gain on
forward foreign exchange contracts held for trading |
|
|
1,789 |
|
|
(1,122 |
) |
|
3,730 |
|
|
241 |
|
Unrealized gain/(loss)
on derivative financial instruments held for trading |
|
|
8,536 |
|
|
(32,132 |
) |
|
10,570 |
|
|
(7,922 |
) |
Recycled loss of cash
flow hedges reclassified to profit or loss |
|
|
— |
|
|
— |
|
|
(4,368 |
) |
|
— |
|
Ineffective portion of
cash flow hedges |
|
|
(65 |
) |
|
43 |
|
|
(65 |
) |
|
(289 |
) |
Total |
|
$ |
8,610 |
|
$ |
(32,383 |
) |
$ |
2,025 |
|
$ |
(6,077 |
) |
There was a profit of $30.4 million and $126.4 million for the
quarter and the year ended December 31, 2018, respectively ($29.7
million and $84.2 million profit for the quarter and the year ended
December 31, 2017, respectively). The increase in profit was mainly
attributable to the increase in profit from operations due to the
factors mentioned above, partially offset by the decrease in gain
on derivatives and the increase in financial costs.
Adjusted Profit(1) was $62.5 million and $134.8 million for the
quarter and the year ended December 31, 2018, respectively ($21.4
million and $78.7 million for the quarter and the year ended
December 31, 2017, respectively) adjusted for the effects of the
non-cash losses on derivatives and the net foreign exchange
losses/(gains).
Profit attributable to the owners of GasLog was $13.8 million
and $47.7 million for the quarter and the year ended December 31,
2018, respectively ($8.9 million and $15.5 million profit for the
quarter and the year ended December 31, 2017, respectively). The
increase in profit attributable to the owners of GasLog in the
fourth quarter of 2018, as compared to the fourth quarter of 2017,
resulted mainly from the respective movements in profit mentioned
above and the decreased amount allocated to third parties following
the decreased Partnership’s profit. The year-on-year increase in
profit attributable to the owners of GasLog resulted mainly from
the respective movements in profit mentioned above, partially
offset by the increased amount allocated to third parties as a
result of the issuances under the GasLog Partners’ ATM Programme,
the preference unit issuances in January 2018 and November 2018 and
the sale of three vessels to GasLog Partners.
EBITDA(1) was $145.0 million and $447.5 million for the quarter
and the year ended December 31, 2018, respectively ($89.7 million
and $355.9 million for the quarter and the year ended December 31,
2017, respectively). The increase in EBITDA(1) in the fourth
quarter of 2018 as compared to the same quarter of 2017 was driven
by the increase in revenues and improved net pool performance
reflecting the significant increase in LNG shipping spot rates, as
well as the decrease in vessels operating and supervision costs and
voyages expenses. The year-on-year increase in EBITDA(1) was
driven by the increase in revenues and net pool performance,
partially offset by the increase in vessel operating expenses and
voyage expenses and commissions as discussed above.
Adjusted EBITDA(1) was $145.0 million and $447.7 million for the
quarter and the year ended December 31, 2018, respectively ($89.7
million and $356.0 million for the quarter and the year ended
December 31, 2017, respectively).
Earnings per share was $0.14 and $0.47 for the
quarter and the year ended December 31, 2018, respectively
(earnings per share of $0.08 and $0.07 for the quarter and the year
ended December 31, 2017, respectively). The increase in earnings
per share is mainly attributable to the respective movements in
profit attributable to the owners of GasLog discussed above.
Adjusted Earnings per share(1) was $0.54 and
$0.57 for the quarter and the year ended December 31, 2018,
respectively (a loss of $0.02 and $0.00 for the quarter and the
year ended December 31, 2017, respectively), adjusted for the
effects of the non-cash (gains)/losses on derivative financial
instruments and the net foreign exchange losses/(gains).
(1) Adjusted Profit, EBITDA, Adjusted EBITDA and Adjusted EPS
are non-GAAP financial measures and should not be used in isolation
or as a substitute for GasLog’s financial results presented in
accordance with IFRS. For definitions and reconciliations of these
measurements to the most directly comparable financial measures
calculated and presented in accordance with IFRS, please refer to
Exhibit II at the end of this press release.
Contracted Charter Revenues and Days
from Time Charters
The following table summarizes GasLog’s
(including the vessels contributed or sold to GasLog Partners)
contracted charter revenues and vessel utilization as of December
31, 2018:
|
For the Year Ending
December 31, |
|
|
2019 |
|
|
2020 |
|
|
2021 |
|
|
2022 |
|
2023-2029 |
Total |
|
(in millions of U.S. dollars, except days and
percentages) |
Contracted time charter
revenues(1) |
$ |
548.1 |
|
$ |
480.9 |
|
$ |
459.6 |
|
$ |
453.7 |
|
$ |
1,681.5 |
|
$ |
3,623.8 |
|
Total contracted
days(1) |
|
7,429 |
|
|
6,565 |
|
|
6,029 |
|
|
5,840 |
|
|
21,967 |
|
|
47,830 |
|
Total available
days(2) |
|
9,874 |
|
|
10,697 |
|
|
12,202 |
|
|
12,775 |
|
|
88,085 |
|
|
133,633 |
|
Total unfixed
days(3) |
|
2,445 |
|
|
4,132 |
|
|
6,173 |
|
|
6,935 |
|
|
66,118 |
|
|
85,803 |
|
Percentage of total
contracted days/total available days |
|
75.2 |
% |
|
61.4 |
% |
|
49.4 |
% |
|
45.7 |
% |
|
24.9 |
% |
|
35.8 |
% |
(1)
Reflects time charter revenues and contracted days for six of our
wholly owned vessels, the 13 of the 14 vessels owned by the
Partnership, the bareboat vessel and seven of our nine newbuildings
on order for which we have secured time charters. Does not include
charter revenues for the vessels operating in the spot/short‑term
market under the Cool Pool agreement, the two newbuild vessels
without charters and the Methane Nile Eagle, in which we hold a
25.0% minority interest. Contracted revenue calculations assume:
(a) 365 revenue days per annum, with 30 off‑hire days when the
vessel undergoes scheduled dry‑docking (every five years);
(b) all LNG carriers on order are delivered on schedule; and
(c) no exercise of any option to extend the terms of charters.
Revenue calculations for such charters include an estimate of the
amount of the operating cost component and the management fee
component.
(2)
Available days represent total calendar days after deducting 30
off‑hire days when the vessel undergoes scheduled dry‑docking. The
available days for the vessels operating in the spot/short‑term
market are included.
(3)
Represents available days for ships after the expiration of
existing charters (assuming charterers do not exercise any option
to extend the terms of the charters) and the available days for the
vessels operating in the spot/short‑term market and the two
uncommitted newbuild vessels.
Other than the assumptions reflected in the footnotes to the
table, including our assumption that our newbuildings are delivered
on schedule, the table does not reflect events occurring after
December 31, 2018. The table reflects only our contracted charter
revenues for the ships in our owned fleet and bareboat fleet for
which we have secured time charters and it does not reflect the
costs or expenses we will incur in fulfilling our obligations under
the charters, nor does it include other revenues we may earn, such
as revenues for technical management of customer-owned ships. In
particular, the table does not reflect any revenues from the six
vessels that are operating in the Cool Pool, any additional ships
we may acquire in the future, nor does it reflect the options under
our time charters that permit our charterers to extend the time
charter terms for successive multi-year periods. The entry into
time charter contracts for the six vessels that are operating in
the Cool Pool and any additional ships we may acquire, or the
exercise of options extending the terms of our existing charters,
would result in an increase in the number of contracted days and
the contracted revenue for our fleet in the future. Although the
contracted charter revenues are based on contracted charter hire
rate provisions, they reflect certain assumptions, including
assumptions relating to the service elements of revenues. We
consider the assumptions to be reasonable as of the date of this
report, but if these assumptions prove to be incorrect, our actual
time charter revenues could differ from those reflected in the
table. Furthermore, any contract is subject to various risks,
including performance by the counterparties or an early termination
of the contract pursuant to its terms. If the charterers are unable
or unwilling to make charter payments to us, or if we agree to
renegotiate charter terms at the request of a charterer or if
contracts are prematurely terminated for any reason, we would be
exposed to prevailing market conditions at the time and our results
of operations and financial condition may be materially adversely
affected. Please see the disclosure under the heading “Risk
Factors” in our Annual Report on Form 20-F filed with the SEC on
February 28, 2018. For these reasons, the contracted charter
revenue information presented above is not fact and should not be
relied upon as being necessarily indicative of future results and
readers are cautioned not to place undue reliance on this
information. Neither the Company’s independent auditors, nor any
other independent accountants, have compiled, examined or performed
any procedures with respect to the information presented in the
table, nor have they expressed any opinion or any other form of
assurance on such information or its achievability and assume no
responsibility for, and disclaim any association with, the
information in the table.
Liquidity and Capital Resources
As of December 31, 2018, GasLog had $342.6 million of cash and
cash equivalents, of which $121.9 million was held in time deposits
and the remaining balance in current accounts. Moreover, as of
December 31, 2018, GasLog had $25.0 million held in time deposits
with an initial duration of more than three months but less than a
year that have been classified as short-term investments.
As of December 31, 2018, GasLog had an aggregate of $2.8 billion
of indebtedness outstanding under its credit facilities and bond
agreements, of which $520.6 million was repayable within one year,
and a $206.1 million finance lease liability related to the sale
and leaseback of the Methane Julia Louise, of which $6.7 million
was repayable within one year.
As of December 31, 2018, there was undrawn available capacity of
$100.0 million under the revolving credit facility of the credit
agreement of up to $1.1 billion entered into on July 19, 2016 (the
“Legacy Facility Refinancing”).
As of December 31, 2018, the total remaining balance of the
contract prices of the nine LNG carriers on order was $1.6 billion
which GasLog expects to be funded with the $165.8 million undrawn
capacity under the financing agreement entered into on October 16,
2015, as well as cash balances, cash from operations, borrowings
under new debt agreements and proceeds from the issuance of new
equity, if any.
As of December 31, 2018, GasLog’s current assets totaled $438.9
million, while current liabilities totaled $669.4 million,
resulting in a negative working capital position of $230.5 million.
Current liabilities include $360.0 million from the outstanding
indebtedness of GAS-three Ltd., GAS-four Ltd., GAS-five Ltd.,
GAS-sixteen Ltd. and GAS-seventeen Ltd., due in November 2019.
GasLog Partners is currently in active discussions with a number of
banks for this refinancing, which are expected to be completed
during the first half of 2019.
As of December 31, 2018, GasLog maintains a total interest rate
swap notional amount at $1.2 billion. GasLog has hedged 47.9% of
its expected floating interest rate exposure on its outstanding
debt (excluding the finance lease liability) as of December 31,
2018.
Our Fleet
Owned Fleet
The following table presents information about our wholly owned
vessels and their associated time charters as of February 14,
2019:
|
|
|
|
|
Cargo |
|
|
|
|
|
|
|
|
|
|
|
Year |
|
Capacity |
|
|
|
|
|
Charter |
|
Optional |
Vessel Name |
|
Built |
|
(cbm) |
|
Charterer |
|
Propulsion |
|
Expiration(1) |
|
Period(2) |
1 |
Methane Lydon Volney |
|
2006 |
|
145,000 |
|
Shell |
|
Steam |
|
October 2020 |
|
— |
2 |
GasLog Savannah |
|
2010 |
|
155,000 |
|
Spot
Market (3) |
|
TFDE |
|
— |
|
— |
3 |
GasLog Singapore |
|
2010 |
|
155,000 |
|
Spot
Market (3) |
|
TFDE |
|
— |
|
— |
4 |
GasLog Chelsea |
|
2010 |
|
153,600 |
|
Spot
Market (3) |
|
TFDE |
|
— |
|
— |
5 |
GasLog Skagen(4) |
|
2013 |
|
155,000 |
|
Spot
Market (3) |
|
TFDE |
|
— |
|
— |
6 |
GasLog Saratoga(4) |
|
2014 |
|
155,000 |
|
Shell |
|
TFDE |
|
September 2019 |
|
— |
7 |
GasLog Salem |
|
2015 |
|
155,000 |
|
Spot
Market (3) |
|
TFDE |
|
— |
|
— |
8 |
GasLog Glasgow |
|
2016 |
|
174,000 |
|
Shell |
|
TFDE |
|
June
2026 |
|
2031 |
9 |
GasLog Houston |
|
2018 |
|
174,000 |
|
Shell |
|
LP-2S |
|
May
2028 |
|
2031-2034 |
10 |
GasLog Hong Kong |
|
2018 |
|
174,000 |
|
Total
(5) |
|
LP-2S |
|
December 2025 |
|
2028 |
11 |
GasLog Genoa |
|
2018 |
|
174,000 |
|
Shell |
|
LP-2S |
|
April
2027 |
|
2030-2033 |
The following table presents information about GasLog Partners’
fleet and their associated time charters as of February 14,
2019:
|
|
|
|
|
Cargo |
|
|
|
|
|
|
|
|
|
|
|
Year |
|
Capacity |
|
|
|
|
|
Charter |
|
Optional |
Vessel Name |
|
Built |
|
(cbm) |
|
Charterer |
|
Propulsion |
|
Expiration(1) |
|
Period(2) |
1 |
Methane Rita
Andrea |
|
2006 |
|
145,000 |
|
Shell |
|
Steam |
|
April
2020 |
|
— |
2 |
Methane Jane
Elizabeth |
|
2006 |
|
145,000 |
|
Shell |
|
Steam |
|
October 2019 |
|
— |
3 |
Methane Jane Elizabeth/
Methane Alison Victoria |
|
2006/2007 |
|
145,000 |
|
New
Customer |
|
Steam |
|
November/December 2020(6) |
|
2021–2024 |
|
Methane Alison
Victoria |
|
2007 |
|
145,000 |
|
Shell |
|
Steam |
|
December 2019 |
|
— |
4 |
Methane Shirley
Elisabeth |
|
2007 |
|
145,000 |
|
Shell |
|
Steam |
|
June
2020 |
|
— |
5 |
Methane Heather
Sally |
|
2007 |
|
145,000 |
|
Shell |
|
Steam |
|
December 2020 |
|
2023-2025 |
6 |
GasLog Shanghai |
|
2013 |
|
155,000 |
|
Spot
Market (3) |
|
TFDE |
|
— |
|
— |
7 |
GasLog Santiago |
|
2013 |
|
155,000 |
|
New
Customer |
|
TFDE |
|
December 2021 |
|
2022-2028 |
8 |
GasLog Sydney |
|
2013 |
|
155,000 |
|
Cheniere(7) |
|
TFDE |
|
June
2020 |
|
2020-2021 |
9 |
GasLog Seattle |
|
2013 |
|
155,000 |
|
Shell |
|
TFDE |
|
June
2021 |
|
— |
10 |
Solaris |
|
2014 |
|
155,000 |
|
Shell |
|
TFDE |
|
June
2021 |
|
2026-2031 |
11 |
GasLog Greece |
|
2016 |
|
174,000 |
|
Shell |
|
TFDE |
|
March
2026 |
|
2031 |
12 |
GasLog Geneva |
|
2016 |
|
174,000 |
|
Shell |
|
TFDE |
|
September 2023 |
|
2028-2031 |
13 |
GasLog Gibraltar |
|
2016 |
|
174,000 |
|
Shell |
|
TFDE |
|
October 2023 |
|
2028-2031 |
14 |
Methane Becki Anne |
|
2010 |
|
170,000 |
|
Shell |
|
TFDE |
|
March
2024 |
|
2027-2029 |
Bareboat Vessel
|
|
|
|
|
Cargo |
|
|
|
|
|
|
|
|
|
|
|
Year |
|
Capacity |
|
|
|
|
|
Charter |
|
Optional |
Vessel Name |
|
Built |
|
(cbm) |
|
Charterer |
|
Propulsion |
|
Expiration(1) |
|
Period(2) |
1 |
Methane Julia Louise
(8) |
|
2010 |
|
170,000 |
|
Shell |
|
TFDE |
|
March
2026 |
|
2029-2031 |
(1) Indicates the expiration of the initial
term. (2) The period shown reflects the expiration of
the minimum optional period and the maximum optional period. The
charterer of the GasLog Santiago may extend the term of this time
charter for a period ranging from one to seven years, provided that
the charterer provides us with advance notice of declaration. The
charterer of the GasLog Sydney may extend the term of this time
charter for a period ranging from six to twelve months, provided
that the charterer provides us with advance notice of declaration.
The charterer of the Solaris has a unilateral option to extend the
term of the time charter for a period ranging from five to ten
years, provided that the charterer provides us with advance notice
of declaration of any option in accordance with the terms of the
charter. The charterer of the Methane Heather Sally, the Methane
Becki Anne and the Methane Julia Louise has unilateral options to
extend the term of the related time charters for a period of either
three or five years at their election, provided that the charterer
provides us with advance notice of declaration of any option in
accordance with the terms of the applicable charter. The charterer
of the GasLog Greece and the GasLog Glasgow has the right to extend
the charters for a period of five years at the charterer’s option.
The charterer of the GasLog Geneva and the GasLog Gibraltar has the
right to extend the charter by two additional periods of five and
three years, respectively, provided that the charterer provides us
with advance notice of declaration. The charterer of the GasLog
Houston and the GasLog Genoa has the right to extend the charters
by two additional periods of three years, provided that the
charterer provides us with advance notice of declaration. The
charterer of the GasLog Hong Kong has the right to extend the
charter for a period of three years, provided that the charterer
provides us with advance notice of declaration. (3)
Vessels currently operating in the spot market under the Cool
Pool.(4) Shell and GasLog have agreed to substitute the
GasLog Saratoga for the GasLog Skagen. The substitution took effect
subsequent to the end of the GasLog Skagen’s dry-docking in
September 2018. (5) “Total” refers to Total Gas &
Power Chartering Limited, a wholly owned subsidiary of Total
S.A.(6) On March 22, 2018, a new charter party agreement was
signed with a new customer for either the Methane Jane Elizabeth or
the Methane Alison Victoria (as nominated by the Partnership)
commencing in either November or December 2019, at the
Partnership’s option, until November or December 2020, with the
charterer having the option to extend the charter from one to four
years.(7) The vessel began her 18-month charter with
Cheniere in December 2018.(8) On February 24, 2016, GasLog’s
subsidiary, GAS-twenty six Ltd., completed the sale and leaseback
of the Methane Julia Louise with Lepta Shipping Co., Ltd. (“Lepta
Shipping”). Lepta Shipping has the right to on-sell and lease back
the vessel. The vessel was sold to Lepta Shipping for a total
consideration approximately equivalent to its current book value.
GasLog has leased back the vessel under a bareboat charter from
Lepta Shipping for a period of up to 20 years. GasLog has the
option to re-purchase the vessel on pre-agreed terms no earlier
than the end of year ten and no later than the end of year 17 of
the bareboat charter. The vessel remains on its eleven-year-charter
with Methane Services Limited, a subsidiary of Shell.
Future Deliveries
GasLog has nine newbuildings on order at Samsung which are on
schedule and within budget:
LNG Carrier |
|
Year Built(1) |
|
Shipyard |
|
Cargo Capacity (cbm) |
|
Charterer |
|
Propulsion |
|
Estimated Charter Expiration(2) |
Hull
No. 2131 |
|
Q1
2019 |
|
Samsung |
|
174,000 |
|
Shell |
|
LP-2S |
|
2029 |
Hull
No. 2212 |
|
Q3
2019 |
|
Samsung |
|
180,000 |
|
— |
|
LP-2S |
|
— |
Hull
No. 2213 |
|
Q2
2020 |
|
Samsung |
|
180,000 |
|
Centrica |
|
LP-2S |
|
2027 |
Hull
No. 2274 |
|
Q2
2020 |
|
Samsung |
|
180,000 |
|
— |
|
LP-2S |
|
— |
Hull
No. 2262 |
|
Q3
2020 |
|
Samsung |
|
180,000 |
|
Centrica |
|
LP-2S |
|
2027 |
Hull
No. 2300 |
|
Q4
2020 |
|
Samsung |
|
174,000 |
|
Cheniere |
|
LP-2S |
|
2027 |
Hull
No. 2301 |
|
Q4
2020 |
|
Samsung |
|
174,000 |
|
Cheniere |
|
LP-2S |
|
2027 |
Hull
No. 2311 |
|
Q2
2021 |
|
Samsung |
|
180,000 |
|
Cheniere |
|
LP-2S |
|
2028 |
Hull
No. 2312 |
|
Q3
2021 |
|
Samsung |
|
180,000 |
|
Cheniere |
|
LP-2S |
|
2028 |
____________(1)
Expected delivery quarters are presented.
(2) Charter expiration to be
determined based upon actual date of delivery.
Conference Call
GasLog will host a conference call to discuss its results for
the fourth quarter of 2018 at 8:30 a.m. EDT (1:30 p.m. GMT) on
Thursday, February 14, 2019. Paul Wogan, Chief Executive Officer,
and Alastair Maxwell, Chief Financial Officer, will review the
Company’s operational and financial performance for the period.
Management's presentation will be followed by a Q&A
session.
The dial-in numbers for the conference call are as follows:
+1 855 253 8928 (USA) +44 20 3107 0289 (United Kingdom) +33 1 70
80 71 53 (France)+852 3011 4522 (Hong Kong)
Conference ID: 6870419
A live webcast of the conference call will also be available on
the Investor Relations page of the Company's website at
http://www.gaslogltd.com/investor-relations.
For those unable to participate in the conference call, a replay
of the webcast will be available on the Investor Relations page of
the Company’s website at
http://www.gaslogltd.com/investor-relations.
About GasLog
GasLog is an international owner, operator and manager of LNG
carriers providing support to international energy companies as
part of their LNG logistics chain. GasLog’s consolidated owned
fleet consists of 34 LNG carriers (25 ships on the water and nine
on order). GasLog also has an additional LNG carrier which was sold
to a subsidiary of Mitsui & Co. Ltd. and leased back under a
long-term bareboat charter. GasLog’s consolidated fleet currently
includes 14 LNG carriers in operation owned by GasLog Partners.
GasLog’s principal executive offices are at Gildo Pastor Center, 7
Rue du Gabian, MC 98000, Monaco. Visit GasLog’s website at
http://www.gaslogltd.com.
Forward-Looking Statements
All statements in this press release that are not statements of
historical fact are “forward-looking statements” within the meaning
of the U.S. Private Securities Litigation Reform Act of 1995.
Forward-looking statements include statements that address
activities, events or developments that the Company expects,
projects, believes or anticipates will or may occur in the future,
particularly in relation to our operations, cash flows, financial
position, liquidity and cash available for dividends or
distributions, plans, strategies, business prospects and changes
and trends in our business and the markets in which we operate. We
caution that these forward-looking statements represent our
estimates and assumptions only as of the date of this press
release, about factors that are beyond our ability to control or
predict, and are not intended to give any assurance as to future
results. Any of these factors or a combination of these factors
could materially affect future results of operations and the
ultimate accuracy of the forward-looking statements. Accordingly,
you should not unduly rely on any forward-looking statements.
Factors that might cause future results and outcomes to differ
include, but are not limited to, the following:
• general LNG shipping market conditions and trends,
including spot and multi-year charter rates, ship values, factors
affecting supply and demand of LNG and LNG shipping, technological
advancements and opportunities for the profitable operations of LNG
carriers; • fluctuations in spot and long-term charter
hire rates and vessel values;• increased exposure to
the spot market and fluctuations in spot charter rates;
• our ability to maximize the use of our vessels,
including the re-deployment or disposition of vessels which are not
under multi-year charters, including the risk that certain of our
vessels may no longer have the latest technology at such time which
may impact the rate at which we can charter such
vessels;• changes in our operating expenses, including
crew wages, maintenance, dry-docking and insurance costs and bunker
prices;• number of off-hire days and dry-docking
requirements including our ability to complete scheduled
dry-dockings on time and within budget;• planned
capital expenditures and availability of capital resources to fund
capital expenditures;• our ability to maintain long
term relationships and enter into time charters with new and
existing customers;• fluctuations in prices for crude
oil, petroleum products and natural gas, including LNG;
• changes in the ownership of our charterers;
• our customers’ performance of their obligations under
our time charters and other contracts; • our future
operating performance and expenses, financial condition, liquidity
and cash available for dividends and distributions; •
our ability to obtain financing to fund capital expenditures,
acquisitions and other corporate activities, funding by banks of
their financial commitments, and our ability to meet our
restrictive covenants and other obligations under our credit
facilities; • future, pending or recent acquisitions of
or orders for ships or other assets, business strategy, areas of
possible expansion and expected capital spending; • the
time that it may take to construct and deliver newbuildings and the
useful lives of our ships; • fluctuations in currencies
and interest rates;• the expected cost of and our
ability to comply with environmental and regulatory conditions,
including changes in laws and regulations or actions taken by
regulatory authorities, governmental organizations, classification
societies and standards imposed by our charterers applicable to our
business;• risks inherent in ship operation, including
the discharge of pollutants; • our ability to retain
key employees and the availability of skilled labour, ship crews
and management;• potential disruption of shipping
routes due to accidents, political events, piracy or acts by
terrorists; • potential liability from future
litigation; • any malfunction or disruption of
information technology systems and networks that our operations
rely on or any impact of a possible cybersecurity breach; and
• other risks and uncertainties described in the
Company’s Annual Report on Form 20-F filed with the SEC on February
28, 2018 and available at http://www.sec.gov.
We undertake no obligation to update or revise any
forward-looking statements contained in this press release, whether
as a result of new information, future events, a change in our
views or expectations or otherwise, except as required by
applicable law. New factors emerge from time to time, and it is not
possible for us to predict all of these factors. Further, we cannot
assess the impact of each such factor on our business or the extent
to which any factor, or combination of factors, may cause actual
results to be materially different from those contained in any
forward-looking statement.
The declaration and payment of dividends are at all times
subject to the discretion of our board of directors and will depend
on, amongst other things, risks and uncertainties described above,
restrictions in our credit facilities, the provisions of Bermuda
law and such other factors as our board of directors may deem
relevant.
Contacts:Alastair MaxwellChief Financial
OfficerPhone: +44-203-388-3100
Phil CorbettHead of Investor RelationsPhone:
+44-203-388-3116
Joseph NelsonDeputy Head of Investor RelationsPhone:
+1-212-223-0643
Email: ir@gaslogltd.com EXHIBIT I - Unaudited Interim
Financial Information
Unaudited condensed consolidated statements of financial
positionAs of December 31, 2017 and
2018(Amounts expressed in thousands of U.S.
Dollars)
|
|
|
|
|
|
|
|
December 31, 2017 |
|
December 31, 2018 |
|
Assets |
|
|
|
|
|
|
Non-current
assets |
|
|
|
|
|
|
Goodwill |
|
9,511 |
|
|
9,511 |
|
Investment in
associates |
|
20,800 |
|
|
20,713 |
|
Deferred financing
costs |
|
17,519 |
|
|
4,576 |
|
Other non-current
assets |
|
428 |
|
|
2,543 |
|
Derivative financial
instruments |
|
16,012 |
|
|
8,966 |
|
Tangible fixed
assets |
|
3,772,566 |
|
|
4,323,582 |
|
Vessels under
construction |
|
166,655 |
|
|
159,275 |
|
Vessel held under
finance lease |
|
214,329 |
|
|
206,753 |
|
Total
non-current assets |
|
4,217,820 |
|
|
4,735,919 |
|
Current
assets |
|
|
|
|
|
|
Trade and other
receivables |
|
10,706 |
|
|
20,244 |
|
Dividends receivable
and other amounts due from related parties |
|
8,666 |
|
|
33,395 |
|
Derivative financial
instruments |
|
2,199 |
|
|
6,222 |
|
Inventories |
|
6,839 |
|
|
7,753 |
|
Prepayments and other
current assets |
|
4,569 |
|
|
3,680 |
|
Short-term
investments |
|
— |
|
|
25,000 |
|
Cash and cash
equivalents |
|
384,092 |
|
|
342,594 |
|
Total current
assets |
|
417,071 |
|
|
438,888 |
|
Total
assets |
|
4,634,891 |
|
|
5,174,807 |
|
Equity and
liabilities |
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
Preference shares |
|
46 |
|
|
46 |
|
Share capital |
|
810 |
|
|
810 |
|
Contributed
surplus |
|
911,766 |
|
|
850,576 |
|
Reserves |
|
18,347 |
|
|
18,962 |
|
Treasury shares |
|
(6,960 |
) |
|
(3,266 |
) |
(Accumulated
deficit)/retained earnings |
|
(5,980 |
) |
|
12,614 |
|
Equity
attributable to owners of the Group |
|
918,029 |
|
|
879,742 |
|
Non-controlling
interests |
|
845,105 |
|
|
1,103,380 |
|
Total
equity |
|
1,763,134 |
|
|
1,983,122 |
|
Current
liabilities |
|
|
|
|
|
|
Trade accounts
payable |
|
11,526 |
|
|
11,890 |
|
Ship management
creditors |
|
2,394 |
|
|
580 |
|
Amounts due to related
parties |
|
35 |
|
|
169 |
|
Derivative financial
instruments |
|
1,815 |
|
|
2,091 |
|
Other payables and
accruals |
|
93,418 |
|
|
127,450 |
|
Borrowings, current
portion |
|
179,367 |
|
|
520,550 |
|
Finance lease
liability, current portion |
|
6,302 |
|
|
6,675 |
|
Total current
liabilities |
|
294,857 |
|
|
669,405 |
|
Non-current
liabilities |
|
|
|
|
|
|
Derivative financial
instruments |
|
— |
|
|
10,001 |
|
Borrowings, non-current
portion |
|
2,368,189 |
|
|
2,307,909 |
|
Finance lease
liability, non-current portion |
|
207,126 |
|
|
199,424 |
|
Other non-current
liabilities |
|
1,585 |
|
|
4,946 |
|
Total
non-current liabilities |
|
2,576,900 |
|
|
2,522,280 |
|
Total equity
and liabilities |
|
4,634,891 |
|
|
5,174,807 |
|
|
|
|
|
|
|
|
Unaudited condensed consolidated statements of profit or
lossFor the three months and years ended
December 31, 2017 and
2018(Amounts expressed in thousands of U.S.
Dollars, except per share data)
|
For the three months ended |
|
For the years ended |
|
|
December 31,
2017 |
|
December 31,
2018 |
|
December 31,
2017 |
|
December 31,
2018 |
|
Revenues |
|
135,772 |
|
|
188,644 |
|
|
525,229 |
|
|
618,344 |
|
Net pool
allocation |
|
3,893 |
|
|
(1,675 |
) |
|
7,254 |
|
|
17,818 |
|
Voyage expenses and
commissions |
|
(5,233 |
) |
|
(3,631 |
) |
|
(15,404 |
) |
|
(20,374 |
) |
Vessel operating and
supervision costs |
|
(35,595 |
) |
|
(29,120 |
) |
|
(122,486 |
) |
|
(128,084 |
) |
Depreciation |
|
(34,581 |
) |
|
(39,510 |
) |
|
(137,187 |
) |
|
(153,193 |
) |
General and
administrative expenses |
|
(9,637 |
) |
|
(9,711 |
) |
|
(39,850 |
) |
|
(41,993 |
) |
Profit from
operations |
|
54,619 |
|
|
104,997 |
|
|
217,556 |
|
|
292,518 |
|
Financial costs |
|
(34,870 |
) |
|
(44,122 |
) |
|
(139,181 |
) |
|
(166,627 |
) |
Financial income |
|
871 |
|
|
1,417 |
|
|
2,650 |
|
|
4,784 |
|
Gain/(loss) on
derivatives |
|
8,610 |
|
|
(32,383 |
) |
|
2,025 |
|
|
(6,077 |
) |
Share of profit of
associates |
|
455 |
|
|
475 |
|
|
1,159 |
|
|
1,800 |
|
Total other
expenses, net |
|
(24,934 |
) |
|
(74,613 |
) |
|
(133,347 |
) |
|
(166,120 |
) |
Profit for the
period |
|
29,685 |
|
|
30,384 |
|
|
84,209 |
|
|
126,398 |
|
Attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the
Group |
|
8,934 |
|
|
13,785 |
|
|
15,506 |
|
|
47,683 |
|
Non-controlling
interests |
|
20,751 |
|
|
16,599 |
|
|
68,703 |
|
|
78,715 |
|
|
|
29,685 |
|
|
30,384 |
|
|
84,209 |
|
|
126,398 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per
share – basic |
|
0.08 |
|
|
0.14 |
|
|
0.07 |
|
|
0.47 |
|
Earnings per
share – diluted |
|
0.08 |
|
|
0.14 |
|
|
0.07 |
|
|
0.46 |
|
Unaudited condensed consolidated statements of cash
flowsFor the years ended December
31, 2017 and 2018(Amounts
expressed in thousands of U.S. Dollars)
|
For the years ended |
|
December 31, 2017 |
|
December 31, 2018 |
|
Cash flows from
operating activities: |
|
|
|
|
|
|
Profit for the
year |
|
84,209 |
|
|
126,398 |
|
Adjustments for: |
|
|
|
|
|
|
Depreciation |
|
137,187 |
|
|
153,193 |
|
Share of profit of
associates |
|
(1,159 |
) |
|
(1,800 |
) |
Financial income |
|
(2,650 |
) |
|
(4,784 |
) |
Financial costs |
|
139,181 |
|
|
166,627 |
|
Unrealized foreign
exchange (gain)/loss on cash and cash equivalents |
|
(772 |
) |
|
329 |
|
Unrealized (gain)/loss
on derivative financial instruments held for trading, including
ineffective portion of cash flow hedges |
|
(10,505 |
) |
|
8,211 |
|
Recycled loss of cash
flow hedges reclassified to profit or loss |
|
4,368 |
|
|
— |
|
Non-cash defined
benefit obligations |
|
— |
|
|
(51 |
) |
Share-based
compensation |
|
4,565 |
|
|
5,216 |
|
|
|
354,424 |
|
|
453,339 |
|
Movements in working
capital |
|
(4,163 |
) |
|
(27,708 |
) |
Cash provided
by operations |
|
350,261 |
|
|
425,631 |
|
Interest paid |
|
(126,631 |
) |
|
(141,921 |
) |
Net cash
provided by operating activities |
|
223,630 |
|
|
283,710 |
|
Cash flows from
investing activities: |
|
|
|
|
|
|
Payments for tangible
fixed assets, vessels under construction and vessel held under
finance lease |
|
(82,352 |
) |
|
(673,823 |
) |
Dividends received from
associate |
|
1,315 |
|
|
1,263 |
|
Return of contributed
capital from associate |
|
59 |
|
|
— |
|
Other investments |
|
(14,125 |
) |
|
(136 |
) |
Purchase of short-term
investments |
|
(37,244 |
) |
|
(71,000 |
) |
Maturity of short-term
investments |
|
55,244 |
|
|
46,000 |
|
Financial income
received |
|
2,504 |
|
|
4,697 |
|
Net cash used
in investing activities |
|
(74,599 |
) |
|
(692,999 |
) |
Cash flows from
financing activities: |
|
|
|
|
|
|
Proceeds from bank
loans and bonds |
|
280,000 |
|
|
524,165 |
|
Bank loans and bonds
repayments |
|
(397,008 |
) |
|
(231,753 |
) |
Payment of loan
issuance costs |
|
(8,830 |
) |
|
(7,449 |
) |
Proceeds from GasLog
Partners' public common unit offerings (net of underwriting
discounts and commissions) |
|
141,395 |
|
|
60,345 |
|
Proceeds from GasLog
Partners' preference unit offering (net of underwriting discounts
and commissions) |
|
139,222 |
|
|
208,394 |
|
Payment of equity
raising costs |
|
(2,032 |
) |
|
(917 |
) |
Payment for NOK bond
repurchase at a premium |
|
(1,459 |
) |
|
— |
|
Payment for cross
currency swaps’ termination |
|
(20,603 |
) |
|
— |
|
Purchase of treasury
shares |
|
— |
|
|
(62 |
) |
Proceeds from stock
options’ exercise |
|
1,223 |
|
|
754 |
|
Dividends paid |
|
(121,071 |
) |
|
(178,028 |
) |
Payments for finance
lease liability |
|
(3,572 |
) |
|
(7,329 |
) |
Net cash
provided by financing activities |
|
7,265 |
|
|
368,120 |
|
Effects of exchange
rate changes on cash and cash equivalents |
|
772 |
|
|
(329 |
) |
Increase/(decrease) in cash and cash
equivalents |
|
157,068 |
|
|
(41,498 |
) |
Cash and cash
equivalents, beginning of the year |
|
227,024 |
|
|
384,092 |
|
Cash and cash
equivalents, end of the year |
|
384,092 |
|
|
342,594 |
|
EXHIBIT II
Non-GAAP Financial Measures:
EBITDA, Adjusted EBITDA, Adjusted Profit and Adjusted
EPS
EBITDA is defined as earnings before depreciation, amortization,
financial income and costs, gain/loss on derivatives and taxes.
Adjusted EBITDA is defined as EBITDA before foreign exchange
gains/losses. Adjusted Profit represents earnings before write-off
and accelerated amortization of unamortized loan fees/bond fees and
premium, foreign exchange gains/losses and non-cash gain/loss on
derivatives that includes (if any) (a) unrealized gain/loss on
derivative financial instruments held for trading, (b) recycled
loss of cash flow hedges reclassified to profit or loss and (c)
ineffective portion of cash flow hedges. Adjusted EPS represents
earnings attributable to owners of the Group before non-cash
gain/loss on derivatives as defined above, foreign exchange
gains/losses and write-off and accelerated amortization of
unamortized loan/bond fees and premium, divided by the weighted
average number of shares outstanding. EBITDA, Adjusted EBITDA,
Adjusted Profit and Adjusted EPS are non-GAAP financial measures
that are used as supplemental financial measures by management and
external users of financial statements, such as investors, to
assess our financial and operating performance. We believe that
these non-GAAP financial measures assist our management and
investors by increasing the comparability of our performance from
period to period. We believe that including EBITDA, Adjusted
EBITDA, Adjusted Profit and Adjusted EPS assists our management and
investors in (i) understanding and analyzing the results of our
operating and business performance, (ii) selecting between
investing in us and other investment alternatives and (iii)
monitoring our ongoing financial and operational strength in
assessing whether to purchase and/or to continue to hold our common
shares. This is achieved by excluding the potentially disparate
effects between periods of, in the case of EBITDA and Adjusted
EBITDA, financial costs, gain/loss on derivatives, taxes,
depreciation and amortization; in the case of Adjusted EBITDA,
foreign exchange gains/losses; and in the case of Adjusted Profit
and Adjusted EPS, non-cash gain/loss on derivatives, foreign
exchange gains/losses and write-off and accelerated amortization of
unamortized loan/bond fees and premium, which items are affected by
various and possibly changing financing methods, financial market
conditions, capital structure and historical cost basis, and which
items may significantly affect results of operations between
periods.
EBITDA, Adjusted EBITDA, Adjusted Profit and Adjusted EPS have
limitations as analytical tools and should not be considered as
alternatives to, or as substitutes for, or superior to, profit,
profit from operations, earnings per share or any other measure of
operating performance presented in accordance with IFRS. Some of
these limitations include the fact that they do not reflect (i) our
cash expenditures or future requirements for capital expenditures
or contractual commitments, (ii) changes in, or cash requirements
for, our working capital needs and (iii) the cash requirements
necessary to service interest or principal payments on our debt.
Although depreciation and amortization are non-cash charges, the
assets being depreciated and amortized will have to be replaced in
the future, and EBITDA and Adjusted EBITDA do not reflect any cash
requirements for such replacements. EBITDA, Adjusted EBITDA,
Adjusted Profit and Adjusted EPS are not adjusted for all non-cash
income or expense items that are reflected in our statements of
cash flows and other companies in our industry may calculate these
measures differently than we do, limiting their usefulness as a
comparative measure.
In evaluating Adjusted EBITDA, Adjusted Profit and Adjusted EPS,
you should be aware that in the future we may incur expenses that
are the same as or similar to some of the adjustments in this
presentation. Our presentation of Adjusted EBITDA, Adjusted Profit
and Adjusted EPS should not be construed as an inference that our
future results will be unaffected by the excluded items. Therefore,
the non-GAAP financial measures as presented below may not be
comparable to similarly titled measures of other companies in the
shipping or other industries.
Reconciliation of Profit to EBITDA and
Adjusted EBITDA:(Amounts expressed in
thousands of U.S. Dollars)
|
For the three months ended |
|
For the year ended |
|
|
December 31,
2017 |
|
December 31,
2018 |
|
December 31,
2017 |
|
December 31,
2018 |
|
Profit for the
period |
|
29,685 |
|
|
30,384 |
|
|
84,209 |
|
|
126,398 |
|
|
Depreciation |
|
34,581 |
|
|
39,510 |
|
|
137,187 |
|
|
153,193 |
|
|
Financial costs |
|
34,870 |
|
|
44,122 |
|
|
139,181 |
|
|
166,627 |
|
|
Financial
income |
|
(871 |
) |
|
(1,417 |
) |
|
(2,650 |
) |
|
(4,784 |
) |
|
(Gain)/loss on
derivatives |
|
(8,610 |
) |
|
32,383 |
|
|
(2,025 |
) |
|
6,077 |
|
|
EBITDA |
|
89,655 |
|
|
144,982 |
|
|
355,902 |
|
|
447,511 |
|
|
Foreign exchange
losses, net |
|
11 |
|
|
44 |
|
|
146 |
|
|
236 |
|
|
Adjusted
EBITDA |
|
89,666 |
|
|
145,026 |
|
|
356,048 |
|
|
447,747 |
|
|
Reconciliation of Profit to Adjusted
Profit:(Amounts expressed in thousands of U.S.
Dollars)
|
For the three months ended |
|
For the year ended |
|
|
December 31,
2017 |
|
December 31,
2018 |
|
December 31,
2017 |
|
December 31,
2018 |
|
Profit for the
period |
|
29,685 |
|
|
30,384 |
|
|
84,209 |
|
|
126,398 |
|
|
Non-cash (gain)/loss on
derivatives |
|
(8,471 |
) |
|
32,089 |
|
|
(6,137 |
) |
|
8,211 |
|
|
Write-off of
unamortized loan/bond fees and premium |
|
213 |
|
|
— |
|
|
506 |
|
|
— |
|
|
Foreign exchange
losses, net |
|
11 |
|
|
44 |
|
|
146 |
|
|
236 |
|
|
Adjusted
Profit |
|
21,438 |
|
|
62,517 |
|
|
78,724 |
|
|
134,845 |
|
|
Reconciliation of Earnings/(Loss) Per Share to Adjusted
(Loss)/Earnings Per Share:(Amounts expressed in
thousands of U.S. Dollars, except shares and per share
data)
|
For the three months ended |
|
For the year ended |
|
|
December 31,
2017 |
|
December 31,
2018 |
|
December 31,
2017 |
|
December 31,
2018 |
|
Profit for the period
attributable to owners of the Group |
|
8,934 |
|
|
13,785 |
|
|
15,506 |
|
|
47,683 |
|
|
Plus: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividend on preference
shares |
|
(2,516 |
) |
|
(2,516 |
) |
|
(10,064 |
) |
|
(10,063 |
) |
|
Profit for the period
available to owners of the Group used in EPS
calculation |
|
6,418 |
|
|
11,269 |
|
|
5,442 |
|
|
37,620 |
|
|
Weighted average number
of shares outstanding, basic |
|
80,673,054 |
|
|
80,838,686 |
|
|
80,622,788 |
|
|
80,792,837 |
|
|
Earnings per
share |
|
0.08 |
|
|
0.14 |
|
|
0.07 |
|
|
0.47 |
|
|
Profit for the period
available to owners of the Group used in EPS calculation |
|
6,418 |
|
|
11,269 |
|
|
5,442 |
|
|
37,620 |
|
|
Plus: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-cash (gain)/loss on
derivatives |
|
(8,471 |
) |
|
32,089 |
|
|
(6,137 |
) |
|
8,211 |
|
|
Write-off of
unamortized loan/bond fees and premium |
|
213 |
|
|
— |
|
|
506 |
|
|
— |
|
|
Foreign exchange
losses, net |
|
11 |
|
|
44 |
|
|
146 |
|
|
236 |
|
|
Adjusted (loss)/profit
attributable to owners of the Group |
|
(1,829 |
) |
|
43,402 |
|
|
(43 |
) |
|
46,067 |
|
|
Weighted average number
of shares outstanding, basic |
|
80,673,054 |
|
|
80,838,686 |
|
|
80,622,788 |
|
|
80,792,837 |
|
|
Adjusted (loss)/earnings
per share |
|
(0.02 |
) |
|
0.54 |
|
|
(0.00 |
) |
|
0.57 |
|
|
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