Golar LNG Partners Q3 2012 results presentation
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Transcript of Golar LNG Partners Q3 2012 results presentation
Golar LNG Partners Third Quarter Results 2012
28 November 2012
This presentation contains forward-looking statements (as defined in Section 21E of the Securities Exchange Act of 1934, as amended) which reflects management’s current expectations, estimates and projections about its operations. All statements, other than statements of historical facts, that address activities and events that will, should, could or may occur in the future are forward-looking statements. Words such as “may,” “could,” “should,” “would,” “expect,” “plan,” “anticipate,” “intend,” “forecast,” “believe,” “estimate,” “predict,” “propose,” “potential,” “continue” or the negative of these terms and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of which are beyond our control and are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this presentation. Unless legally required, Golar LNG Partners undertakes no obligation to update publicly any forward-looking statements whether as a result of new information, future events or otherwise. Among the important factors that could cause actual results to differ materially from those in the forward-looking statements are: changes in liquid natural gas (LNG) and floating storage and regasification unit (FSRU) market trends, including charter rates; changes in the supply and demand for LNG; changes in trading patterns that affect the opportunities for the profitable operation of LNG carriers and FSRUs; Golar LNG Partners ability to acquire new vessels from Golar LNG or third parties; increases in costs; the potential; the potential for the exercise of purchase options or early termination of charters by the Partnerships charterers and Golar Partners inability to replace assets and/or long-term contracts; and changes in the ability of Golar LNG Partners to obtain additional financing, in particular, in connection with the recent turmoil in financial markets. Unpredictable or unknown factors herein also could have material adverse effects on forward-looking statements. Please read Golar LNG Partners' filings with the Securities and Exchange Commission for more information regarding these factors and the risks faced by Golar LNG Partners.
2
Forward Looking Statements
Net income attributable to unit holders of $26.8 million and operating
income of $43.5 million.
Improved performance over the same period last year and Q2 2012
Distributable cash flow generation $25.2 million.
Completed first follow-on equity offering raising net proceeds of
approximately $223 million in July 2012.
Acquisition of interests in the companies that own and operate the
FSRU Nusantara Regas Satu in July 2012 for $385 million
Quarterly distribution increased to $0.475 per unit for the third quarter
of 2012, which represents a 10.5% increase from the rate prior to the
NR Satu acquisition.
3
Q3 2012: Highlights & Recent Events
NOK 1,300 million bond issue in the Norwegian market (approx. $227
million) and repayment of $222 million vendor loan from Golar LNG
Limited in respect of the Golar Freeze acquisition.
Completed second follow-on equity offering raising net proceeds of
approximately $181 million.
Acquisition of interests in the companies that own and operate the LNG
carrier Golar Grand completed for a purchase price of $265 million.
Management recommendation to increase quarterly distributions by
between $0.0225 and $0.0275 per quarter, which would increase
distributions to between $0.4975 and $0.5025.
4
Q3 2012: Highlights & Recent Events
Subsequent to quarter end:
(USD thousands)
2012
Jul-Sep (unaudited)
(1)
2012
Apr-Jun (unaudited)
(1)
2011
Jul-Sep (unaudited)
(1)
2012
Jan-Sep (unaudited)
(1)
2011
Jan-Sep (unaudited)
(1)
Operating revenues
Vessel operating expenses
Voyage expenses
Administrative expenses
Depreciation and Amortisation
Total operating expenses
Operating income
Interest income
Interest expense
Other financial items
Income before tax & non-controlling interests
Tax
Net income attributable to non-controlling interests
Net income attributable to Golar LNG Partners LP Owners
68,628
9,806
1,038
1,421
12,845
25,110
43,518
393
(10,285)
(753)
32,873
(3,292)
(2,760)
26,821
60,273
9,314
751
2,150
10,923
23,138
37,135
456
(8,509)
(2,443)
26,639
(1,557)
(2,504)
22,578
51,776
8,285
35
1,711
9,987
20,018
31,758
386
(3,093)
(14,551)
14,500
226
(2,539)
12,187
179,689
28,986
1,824
4,876
33,625
69,311
110,378
1,318
(25,834)
(4,298)
81,564
(4,838)
(7,735)
68,991
152,327
26,669
195
5,407
31,009
63,280
89,047
1,038
(11,096)
(16,845)
62,144
541
(7,424)
55,261
Income Statement
5
(1) Results for the NR Satu and the Golar Freeze for the periods prior to their acquisition by the Partnership (on July 19, 2012 and October 19, 2011, respectively) when they were owned and operated by Golar LNG Limited have been combined with the previously published results of the Partnership and are included in the results of all periods presented. These results are referred to as the Dropdown Predecessor.
(USD thousands)
2012
Sep 30 (unaudited)
(1)
2011
Dec 31 (unaudited)
(1)
Short term assets
Cash and cash equivalents
Restricted cash and short-term investments
Other current assets
Long term assets
Restricted cash
Vessels and vessels under capital leases, net
Other long term assets
TOTAL ASSETS
47,979
33,617
11,029
144,401
1,083,515
8,177
1,328,718
46,169
24,512
6,612
140,262
1,033,194
5,563
1,256,312
Balance Sheet: Assets
6
(USD thousands)
2012
Sep 30 (unaudited)
(1)
2011
Dec 31 (unaudited)
(1)
Short term liabilities
Current portion of long term debt
Current portion of obligations under capital leases
Other current liabilities
Long term liabilities and equity loan
Long term debt (inc loans due to related parties)
Obligations under capital leases
Other long term liabilities
Owners’ and Dropdown Predecessor equity
Total Partners’ capital
Accumulated other comprehensive (loss) / income
Non-controlling interest
TOTAL LIABILITIES AND EQUITY
Total debt and capital lease obligations net of restricted cash
Percentage of bank debt/lease obligations (net of restricted cash) swapped to a
fixed rate
60,363
3,161
86,845
686,755
273,365
18,686
-
135,271
(5,197)
69,469
1,328,718
845,626
96%
49,906
3,240
77,694
572,978
264,840
27,599
170,091
32,069
(5,039)
62,934
1,256,312
726,190
92%
Balance Sheet: Liabilities
7
Distributable Cash Flow
(USD thousands)
Three months
ended
Sep 30, 2012
Three months
ended
Jun 30, 2012
Net Income before non controlling interest 29,581 25,082
Add: Depreciation and Amortisation (excluding Dropdown Predecessor prior to
acquisition) 12,047 8,884
Unrealised loss from interest rate derivatives 685 1,125
Unrealised foreign exchange & related currency derivative (gain)/loss (1,545) (318)
Less:
Net (income)/loss attributable to Dropdown Predecessor (1,462) (2,749)
Estimated maintenance & replacement capital expenditures (10,518) (8,664)
Non-controlling interests' share of DCF before maintenance & replacement capital
expenditure (3,628) (3,123)
Distributable cash flows for the quarter 25,160 20,237
Distribution for the period 22,476 20,820
8
9
Options Base Contract Duration
Counterparty
FS
RU
s
LN
G C
arr
iers
Golar Spirit 10-year contract
Golar Winter 10-year contract
extended to 15 years
Methane
Princess 20-year contract
Golar Mazo 18-year contract
Assets and Contracts
Golar Freeze 10-year contract
Dusup = Dubai Supply Authority. Pertamina = National oil company of Indonesia. Nusantara Regas = Joint venture between Pertamina and
PGN (National Gas distribution company of Indonesia)
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Recent dropdown Nusantara Regas
Satu 11-year contract
$2.6 billion contracted revenue – Average 8.2 years remaining contract term
Golar Grand 5-year contract Recent dropdown
Option/put to Golar
Golar Grand
Purchase price November 2012 $265 million
Financed by: Share of $181m net equity proceeds $175 million
Debt (finance lease acquired with vessel) $90 million
Net cash from operations before interest costs $36-$38 million
Initial contract term (including put option to Golar) to October 2017 5 years
Vessel delivered under charter March 2012
Management recommended annualized distribution increase $0.09 - $0.11
Increases distributions per unit on an annualized basis to: $1.99 - $2.01
Annualized distribution per unit increase in first year since IPO 11.7%
Distribution increase per unit since IPO based on $2.00 per annum 29.9%
10
11
Growth potential - Golar LNG Limited Fleet
Capacity
Ship Owned Built m3 Containment Propulsion Charter
Golar LNG vessels
Gimi 100% 1976 125,000 Moss Steam Short-term
Hilli 100% 1975 125,000 Moss Steam open
Gandria 100% 1977 126,000 Moss Steam open
Golar Viking 100% 2005 140,000 Membrane Steam Short-term
Golar Maria 100% 2006 145,700 Membrane Steam open
Golar Arctic 100% 2003 140,650 Membrane Steam 3 years
Newbuild 1 100% 2013 160,000 Membrane Tri-fuel
Newbuild 2 100% 2013 160,000 Membrane Tri-fuel
Newbuild 3 100% 2013 160,000 Membrane Tri-fuel
Newbuild 4 100% 2013 160,000 Membrane Tri-fuel
Newbuild 5 100% 2014 160,000 Membrane Tri-fuel
Newbuild 6 100% 2014 160,000 Membrane Tri-fuel
Newbuild 7 100% 2014 160,000 Membrane Tri-fuel
Newbuild 8 100% 2014 162,000 Membrane Tri-fuel
Newbuild 9 100% 2014 162,000 Membrane Tri-fuel
Newbuild 10 100% 2014 160,000 Membrane Tri-fuel
Newbuild 11 100% 2015 160,000 Membrane Tri-fuel
Newbuild FSRU 1 100% 2013 170,000 Membrane Tri-fuel
Newbuild FSRU 2 100% 2014 160,000 Membrane Tri-fuel
12
LNG Industry Growth
LNG Supply LNG Shipping Requirement – September 2012
0
50
100
150
200
250
300
350
400
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
201
7
mm
tpa
Speculative
Possible
Probable Development
Under Construction
Operational
34%
Source: Wood Mackenzie Source: Poten & Partners
13
FSRU Updates
Growing the FSRU Franchise
Shortlisted for 5 projects (2012-2013 awards)
Gas Atacama award subject to possible extension of charterer conditions deadline
Robust Demand for New FSRUs
25+ new projects being developed
Middle East activity continues to be very strong
Rising demand has led to a significant increase in FSRU fleet utilization - very few FSRUs available before 2015
Well positioned for New Awards
2 FSRU newbuilds in 2013/2014
Only uncommitted newbuild FSRU in 2013
Conversions to suit market needs
Strong presence with shipyards
Demonstrable track record toward clients
Nusantara Regas Satu
Freeze FSRU Picture courtesy of DUSUP
14
Golar
Spirit
Golar
Winter
Golar
Freeze
Khannur
Increased distribution to $0.475 per unit following acquisition of the
Nusantara Regas Satu
Golar Grand contract increases revenue backlog – now $2.6 billion
Management recommendation to further increase distribution to
between $0.4975 and $0.5025
Strong growth outlook for LNG demand and supply and related
infrastructure including LNG carriers and FSRU’s
Golar LNG fleet, including 13 newbuildings, provides substantial
dropdown growth potential
Summary