Aurora LPG, the Oslo-listed expanding VLGC owner, has reported a healthy profit for 1Q15 and vows to pay a dividend of USD0.10 per share for the quarter and buy back NOK75 million (USD10 million) worth of its own shares.
Group net profit amounted to USD13.9 million in 1Q15 on revenues of USD21.7 million. There are no comparable figures for 1Q14 as the company started its business last year.
Aurora LPG’s three 82,000 m3-capacity ships generated an average daily time charter income of USD68,500. “A further increase in US exports has kept the seaborne LPG trade favourable in the traditionally weaker quarter of the year,” it said in a statement. “The company expects the demand for shipping to remain robust in the coming quarters.”
It has six 84,000 m3 newbuildings on order, all of which will be delivered next year. “The company has mandated Credit Suisse and ABN AMRO for the financing of its newbuilding programme,” it said. “The company expects the financing to be completed by the third quarter of 2015. Cash and cash equivalents at the end of the period were USD25.3 million.”
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Commenting on the figures, Erik Nikolai Stavseth and Kurt Waldeland, shipping analysts at Arctic Securities in Oslo, said the numbers were more or less as expected, but Aurora LPG surprises with dividends and a buyback.
The buyback equates to about 4.3% of the company’s market capitalisation at the moment. This indicates a confident approach to both the funding of newbuildings and early focus on returning values to shareholders, they said, adding that they maintain their buy recommendation for the shares in the company.
“We reiterate our Arctic buy recommendation and will only make minor adjustments to estimates following the report,” the analysts said, adding that they will review their target.