Dorian LPG Ltd. (NYSE:LPG) Q3 2024 Outcomes Convention Name February 1, 2024 10:00 AM ET

Firm Members

John Hadjipateras – Chairman, President & CEO

Ted Younger – CFO

John Lycouris – CEO-USA

Tim Hansen – CCO

Convention Name Members

Omar Nokta – Jefferies

Øystein Vaagen – Fearnley Securities

Operator

Good morning, and welcome to the Dorian LPG Third Quarter 2024 Earnings Convention Name. [Operator Instructions]. As a reminder, this convention is being recorded. Moreover, a reside audio webcast of immediately’s convention name is accessible on Dorian LPG’s web site, which is www.dorianlpg.com.

I want to now flip the convention over to Ted Younger, Chief Monetary Officer. Thanks, Mr. Younger. Please go forward.

Ted Younger

Thanks, Rob. Good morning, and thanks all for becoming a member of us for our third quarter 2024 outcomes convention name. With me immediately are John Hadjipateras, Chairman, President and CEO of Dorian LPG Restricted; John Lycouris, Chief Govt Officer of Dorian LPG USA; and Tim Hansen, Chief Industrial Officer.

As a reminder, this convention name webcast and a replay of this name will likely be accessible by February 8, 2024. Lots of our remarks immediately include forward-looking statements primarily based on present expectations. These statements could usually be recognized with phrases corresponding to anticipate, anticipate, consider or related indications of future expectations. Though we consider that such forward-looking statements are cheap, we can’t guarantee you that any forward-looking statements will show to be right.

These forward-looking statements are topic to identified and unknown dangers and uncertainties and different elements in addition to normal financial circumstances. Ought to a number of of those dangers or uncertainties materialize or ought to underlying assumptions or estimates show to be incorrect, precise outcomes could range materially from these we categorical immediately.

Moreover, let me refer you to our unaudited outcomes for the interval ended December 31, 2023, that have been filed this morning on Kind 10-Q. As well as, please consult with our filings on Kind 10-Okay the place you may discover threat elements that might trigger precise outcomes to vary materially from these forward-looking statements. Lastly, please additionally consult with the investor spotlight slides posted this morning on our web site to which we are going to refer through the name.

With that, I will flip over the decision to John Hadjipateras.

John Hadjipateras

Thanks, and thanks for becoming a member of us. John Lycouris, Ted, Tim and me will talk about our third quarter monetary 2024 outcomes. As you’ll hear in additional element from Ted and the monetary year-to-date, we earned a document common TCE, document spot TCE and document EBITDA. Whereas sustaining a robust stability sheet and capital to put money into our phase, including our decarbonization initiatives, we proceed to return capital to our shareholders.

Together with our lately declared greenback per share dividend, we could have returned over $690 million to shareholders since our IPO. As one of many largest operators in our phase, we consider we’re nicely positioned to proceed our worthwhile efficiency within the LPG sector and past. Greater than 40 ships have been absorbed into the fleet in 2023, a 12% addition, this was the biggest variety of ships delivered in a single yr for the reason that supply in 2016 of 46 ships, which represented 23% of the then current fleet.

Of the 17 new buildings slated for supply in 2024, 4 have already began buying and selling. We view the market volatility of 2023 and significantly the large price spikes as proof of demand and provide being near equilibrium. The current close to whole elimination of ready time for the canal, which remains to be draft restricted, just isn’t sustainable. The Canal Authority is prioritizing containerships and LNG ships over LPG. There are 109 neo-Panamax containerships and 73 LPG ships slated for supply this yr.

For these causes in addition to the ability discount leading to slower speeds, which did not occur final yr, we’re optimistic. On the HR aspect, we proceed to put money into bettering the standard of lifetime of our show Ukrainian seafarers and their households. We lately launched a simplified fee system by an e-wallet that allows them to obtain their month-to-month allotments shortly and with much less problem.

On the social entrance, we are going to enter our [indiscernible] [04:50] last program by the All Aboard Alliance, a worldwide maritime discussion board sponsored initiative, which is able to allow accelerated knowledge assortment relating to range and elevated alternatives for all genders at sea.

We’re evaluating compelling emission saving units and low friction pains for our ships. Throughout Q3, we paid at one among our dry actions with silicon paid and have signed new contracts for vitality saving units that will likely be retrofitted within the coming yr.

We additionally proceed our real-time emission monitoring program and have enhanced the initiative by putting in MAN’s EcoTorque engine diagnostics instruments on 20 of our personal chips. We have now expanded our efficiency group in Denmark by including a mechanical engineer.

We ordered a brand new constructing, VLGC, VLAC from Hanwa shipyard in Korea for supply in 2026 and are investigating alternatives to improve a few of our current ships to hold ammonia. John Lycouris will communicate additional on this subject.

Ted, you could have the ground.

Ted Younger

Thanks, John. My feedback this morning will concentrate on our capital allocation choices. At December 31, 2023, we reported $208.5 million of free money, which represented a really strong improve from the $190 million is, in fact, reported after the fee of the $40 million dividend that was declared and paid through the December quarter.

As of January 31, we had an unrestricted money stability of $215 million, which is internet of the $23.8 million down fee made on our VLGC AC newbuilding throughout January 2024. We don’t consolidate the P&L or stability sheet accounts of the Helios Pool, which has the impact of understating our reported money.

As of January 31, 2023, the pool held money of $36.2 million, and since we have now a roughly 86% financial curiosity within the pool, it equates to money of roughly $31 million, which isn’t in any other case reported on our stability sheet.

With a debt stability at quarter finish of $623.8 million, our debt to whole ebook capitalization set at 38.8% and internet debt to whole ebook capitalization to extend our revolving credit score facility from $20 million to $50 million and so as to add a $100 million accordion line for vessel acquisitions to the ability. We’re grateful for his or her assist and for his or her endorsement of our stewardship of their capital. We have begun to guage varied pre- and post-delivery prices and excessive degree of monetary flexibility.

Trying ahead, we anticipate our money price per day for the approaching yr in capital expenditures for dry docking and doubtlessly charges for ammonia functionality in our current fleet, which John will talk about later.

For the dialogue of our third quarter outcomes, you additionally could discover it helpful to consult with the investor spotlight slides posted this morning on our web site. I’d additionally remind you that my remarks will embrace quite a lot of phrases corresponding to TCE working days, accessible days and adjusted EBITDA. Please consult with our filings for the definitions of those phrases.

For our third quarter concentrating on outcomes, we achieved a TCE of $76,337 per working day with a complete utilization of 93.6%, yielding utilization adjusted TCE of about $71,431. This TCE end result represents the most effective within the firm’s historical past. As our complete spot buying and selling program is carried out by the Helios Pool, the spot outcomes for Helios are the most effective measure of our spot chartering efficiency. For the December 31 quarter, the Helios Pool are the spot TCE of $91,417 per day, which is the best spot price the pool has ever earned for 1 / 4.

On Web page 4 of the investor highlights materials, you may see that we have now 5 Dorian vessels on time constitution throughout the pool, plus 1 MOL Energia vessel, indicating spot publicity of about 75% to 80% for the 27 vessels within the Helios Pool.

Turning to the quarter ending March 31, 2024, we at present have over 60% of the accessible days within the Helios Pool, booked at a time constitution equal in extra of $100,000 per day, reflecting the very robust charges booked earlier for voyages that will likely be carried out this calendar quarter.

Please be aware that, that price contains each spot fixtures and time charters.

Our OpEx per calendar day, excluding dry docking prices, was $9,909 which was down considerably sequentially from the prior quarter. Reductions in lubricants and spares and shops drove the decline. Our time constitution in expense for the 4-time constitution in vessels got here in at $8.4 million, which is decrease than budgeted on account of some gasoline effectivity underperformance claims.

Whole G&A for the quarter was $7.7 million and money G&A, that’s G&A excluding noncash compensation expense, was about $6.3 million. Of that $6.3 million, about $500,000 included Adour Ukrainian seafarers and a few worker bonuses, plus our core G&A got here in at roughly $5.8 million, which is per our expectations.

Noncash compensation expense for the quarter was $1.4 million, which is per the steering that we gave final quarter. Our reported adjusted EBITDA for the quarter was $133 million, which is the most effective quarterly adjusted EBITDA in our company historical past. Our adjusted EBITDA for the final 12 months is sort of $415 million.

Turning to debt service. Our money curiosity expense, which we calculated because the sum of the road objects, curiosity expense, excluding deferred financing charges and different mortgage bills and realized achieve/loss on rate of interest swap derivatives for the quarter was $7.5 million a decline of about $200,000 from the prior quarter, reflecting decrease common debt and our all-in price of debt of about 4.7%, which I’d be aware is under present floating SOFR charges.

Quarterly principal amortization remained regular at $13.3 million. Our trailing 12-month internet revenue is about $304 million and with common booked shareholders of fairness for a similar 12-month interval of roughly $911 million, we generated a 33.4% return on shareholders’ fairness. We’re pleased with this end result as a result of it not solely displays the robust profitability that our platform can generate, it additionally exhibits that we have managed to maintain our shareholders’ fairness at an acceptable degree, balancing retention of capital whereas nonetheless paying out significant dividends to our shareholders.

The $1 per share dividend declared final week and payable on February 27 to shareholders of document February 5, 2024, brings our whole dividends paid to $11.50 per share or practically $465 million in combination. We underscore — [Technical Difficulty].

Operator

Girls and gents, please stand by. We’re experiencing technical difficulties, and our convention will start momentarily. Thanks.

[Technical Difficulty]

Ted Younger

Thanks, Rob. Once more, we’re optimistic on the long-term prospects of our enterprise, however we’re aware of the near-term headwinds.

With that, I will move it over to Tim Hansen.

Tim Hansen

Sure. Good day, everybody, and thanks for dialing in. As all the time, the VLGC market created some fascinating instances for the members. As a record-selling power in December, contracted sharply with the market throughout January 2024. The quarter ending December 31 in ’23, noticed record-breaking excessive freight ranges for VLGCs. The first drivers of the agency freight market the place the widening U.S. to Asia arbitrage a number of new restrictions making use of to the Panama Canal and subsequent vessel routing choices amidst the uncertainty concerning the Panama and the Swiss Canal transits.

Turning first to the arbitrage. In North America, manufacturing of pure gasoline liquids proceed to extend inventories to document ranges. This was amidst an unseasonably heat begin to the winter. The elevated provide of LPG lowered the U.S. export costs offsetting a number of the short-term issues about Asia import demand as was additionally — the latter has additionally skilled a heat winter. The impact of the drought in Panama has been extensively mentioned. The Panama can now introduce new restrictions on VLGC transit on the finish of October. A extreme discount of water degree necessitated a discount in day by day transits with the price of reserving transfers of VLGC changing into dearer.

By the primary week of November, auctions for neo-Panamax Canal transits reached a peak of just below $4 million. And a few operators confronted the actual risk of not having the ability to safe a northbound transit. VLGCs have been choosing different routes, some turning round Mid Pacific to keep away from uncertainty of the Panama Canal and some optioning to stability round South America, leading to elevated ton miles in addition to impacting lead time for house owners and charters in estimating arrival within the U.S. Gulf for loading.

The scheduling affect was ultimately priced into the freight ranges and late currents have been fastened virtually 2 months ahead of the fixing window. The uncertainties about scheduling and the price affect apply for vessels in each ballast and in laden with charters going through doubtlessly restrictive excessive public sale costs on the Panama Canal or selecting the longer latent passage by way of the Suez Canal.

On common, the quarter ending December ’23 averaged 25 VLGCs, balancing to the U.S. Gulf VLGCs monthly, this in comparison with a mean of 13 VLGCs monthly on the quarter prior. The Suez Canal routing was most well-liked for vessels in ballast and laden to such a level that in December, the Baltic Index noticed payment charges fastened beneath the inexperienced index of use cheaper by way of Panama phrases, with the [indiscernible] fixtures being reported on an enormous obtain Suez price.

The shift in pricing norms made evaluation of the market tougher however testifies to the numerous shift in buying and selling routes for the VLGCs over the interval. Nonetheless, geopolitical tensions within the Center East, made the routing by way of Suez, a short-lived answer. When drone and missile tax and the Purple Sea escalated throughout December, operators started to say no the Purple Sea route on grounds of security. And VLGC have been pushed in direction of routing by way of the Cape of Good Hope.

For the primary time in a number of years, greater than 10 VLGCs ballasted by way of the Cape of Good Hope in 1 month. In consequence, the added miles supported the freight market within the robust time period.

Now reflecting on how circumstances can change. Initially of January, a number of elements elevated the fleet legs. Forecast of [indiscernible] in January within the U.S. created an anticipation of a sudden improve in home LPG consumption, which started to be priced into the product market and decreasing the West to East arbitrage one of many key drivers.

Additionally, the 5 index costs have been on the decline amidst Asian importers anticipating decreased import demand on account of decrease demand for heating. Due to this fact, the arbitrage began to slim impacting the traditional arbitrage economics.

Throughout January 6 newbuildings or 29% of the anticipated deliveries in 2024, we delivered making a strong improve within the vessel provide for the primary calendar quarter of ’24. Congestion within the Panama Canal declined considerably and speedy this month. Contributing elements embrace the rerouting of VLGC VK, liter container vessel site visitors and elevated rainfall within the Panama Canal.

In Italy, this sadly will create a brief oversupply in each the U.S. Gulf and Far East ports, placing strain on the charges as we have seen throughout this quarter, which ought to normalize as vessel provide is up bought. Our freight market may be unstable and is topic to a variety of things that will affect short-term freight charges however we even have quite a lot of robust cyclical and safe elements in our favor.

A hotter spring local weather in North America will contribute to extra LPG provide at extra favorable costs. The anticipation going ahead is, due to this fact, extra widening east — the west to east. We anticipate solely 15 remaining newbuildings to ship this yr in comparison with the 42 that was efficiently absorbed final yr, we anticipate the brand new constructing deliveries to be absorbed primarily based on the forecasted improve in exports.

We proceed to see LPG take market share from different gasoline sources. And in 2024, important development in propane demigration as group monitoring plans are anticipated significantly in Asia. The Panama Canal congestion points are removed from solved. The day by day transit numbers are nonetheless 10 transits much less per day than in July ’23, and it is solely anticipated to revert to the traditional ranges through the summer season.

Rebounding of VLGCs and different segments again in direction of Panama Canal will once more improve the congestion, and along with the VLGC new buildings, there’s anticipated supply of 73 L&T and 109 neo-Panamax containerships in 2024. It will improve the demand for passage of the canal and we thus anticipate congestion to return and to be the norm reasonably than the exception within the canal. Routing with Suez VLGCs thus is predicted to change into extra pronounced in 2024 because of the uncertainties of forecasting the Panama Canal options and prices. Thus, we do stay optimistic on the medium- to long-term prospects for our enterprise whereas acknowledging that short-term volatility is ever current.

With that, I’ll move you over to Mr. John Lycouris.

John Lycouris

Thanks very a lot, Tim. At Dorian LPG, we firmly consider that we must be a part of and supply long-term options to the world’s decarbonization goals and objectives. Our funding in scrubbers continues to derive robust returns. Our common day by day internet financial savings over the quarter on our scrubber vessels stood at about $3,000 per day, $3,000 per day or about $3.4 million for the quarter.

Gas differentials between excessive sulfur gasoline oil and low sulfur gasoline oil averaged about $202 within the final quarter of 2023. The pricing differential of the LPG has gasoline versus gasoline oil, low sulfur gasoline oil, stood at about $183 per metric ton, which was useful for twin gasoline engine vessels when working with LPG.

We now have a complete of 14 scrubber-fitted vessels and 1 chartered in vessels. And we plan to retrofit one other vessel with a scrubber unit within the second quarter of 2024. The installations of vitality saving units and the silicon how coatings to our vessels have offered important efficiency enhancements in gasoline financial savings, discount of the fleet CO2 emissions and improved CII rankings.

Moreover our capital — vessel Captain John NP, which was initially constructed as a VLGC — VLAC, as now referred to as, we’re upgrading a few of our vessels to hold ammonia as it’s fairly seen for an excellent portion of the world fleet to hold out such upgrades.

The EU emissions buying and selling system that got here into impact in January 1, 2024, is relevant to all ships calling at EU ports. Transport firms will give up their gear 2024 EU allowances, newest by September 2025 and yearly thereafter, and it’ll replicate the CO2 emissions whereas their vessels have been buying and selling in EU waters.

In keeping with finish consumer pays precept, the price of complying with the EU ETS is handed by the proprietor to the time constitution, who’s finally accountable for the acquisition and switch of the month-to-month EU allowances to the proprietor’s account. For spot voyages, we anticipate the EU allowances to be added to the freight bill according to the tip customers base rule.

In continuation of Dorian’s dedication to sustainability and bettering the corporate greenhouse gasoline profile, we have now lately invested into firms to hunt options to local weather points from carbon and methane emissions. Ionada is planning to market a compact modular carbon seize system for small and midsized carbon emitters that will likely be relevant to many industries, together with marine purposes.

The patented know-how claims 30% higher effectivity than typical carbon seize applied sciences as it really works with a big array of hole fiber contactor membranes of absorbent options, attaining about 90% seize of carbon dioxide in put up combustion flue gases.

The second is [indiscernible], which focuses on the avoidance of methane gasoline emissions from wasted assets, corresponding to landfill gasoline, biogas and waste biomass. These emissions as a substitute of being granted or burned on web site are transformed into high-value carbon unfavorable and carbon impartial fuels like bio-LNG, bio-LPG, inexperienced methanol and inexperienced ammonia. The modular and scalable know-how may be located at methane emission measurement the place it may be remodeled into high-quality syngas and after remedy consolidated and delivered to the vitality, marine and aviation industries.

Lastly, our current newbuilding contract to construct a brand new VLGC BLAC at Hanwha Ocean yard in South Korea is according to our dedication to make use of capital the place we see business and monetary alternatives for investments. We consider that the longer term inexperienced hydrogen economic system will largely rely upon massive portions of ammonia making use of the season devoted vessels.

Moreover incomes good financial returns on such charges, we additionally firmly consider that we must be a part of and supply long-term options to the world decarbonization goals and objectives.

And now I want to move it over to John Hadjipateras for the closing feedback.

John Hadjipateras

Thanks very a lot, John. We’re completely happy to take questions from anybody who’s curious to ask them please.

Query-and-Reply Session

Operator

[Operator Instructions]. Our first query will likely be coming from the road of Omar Nokta with Jefferies.

Omar Nokta

Congrats, clearly, on a really robust and I suppose, document quarter. And Ted, I simply needed to ask for those who may repeat perhaps the steering determine you talked about for the bookings thus far. Did you say it was 100,000 for 60% of the quarter?

Ted Younger

Sure, that is right, Omar, in extra of 100,000 and in extra of 60% of the times.

Omar Nokta

And that features the TCE.

Ted Younger

That features the pool TCEs.

Omar Nokta

Okay. All proper. After which I simply needed to ask perhaps — and I do know, Tim, you touched on this, however clearly, final yr was a really, very robust yr for VLGCs. You had a giant soar in U.S. set sports activities. You had the Panama Canal, which actually all that may offset the brand new buildings. And as you talked about, the fleet was absolutely absorbed in. Thus far, issues have corrected over the previous few weeks and maybe look to have perhaps overshot to the draw back and particularly in relation to the place I say the low level was presently final yr, what do you see is driving the pullback in charges? And when can we begin to anticipate issues to show round?

John Hadjipateras

Tim? Sure. You’ve got requested Tim, so I will let him. We have now the identical reply in any case. Sure, sure.

Tim Hansen

Sure. So I imply you are proper, we’re at a decrease level now than the drop of final yr, and we’re type of seeing these drop all the time within the first quarter sooner or later. However this yr, it was very fast and dramatic but in addition coming from an exceptionally excessive level. So I’ll say the beginning was aligned in a single path and now they’re within the different path.

I feel that that what we see is each an overreaction. And as I discussed in the long run, I feel we are going to see U.S. stock nonetheless very, very excessive. So even with the chilly winter wouldn’t create the identical worries that you’ve got seen earlier than of the U.S. operating out of gasoline. So I feel the pricing will align once more shortly as quickly because the worst coal is over.

And in addition, one of many different elements is the Panama Canal, which we see yearly that after the festive season within the U.S., the variety of transits decline and the transit particularly for the container enterprise, they’re much less busy passing in January and clearly to the Chinese language vacation. So we see additionally that scenario has a brief blip, and we predict that we’ll return to being congestions being the norm reasonably than the exception.

And as John talked about, extra new buildings on LNG in container. So we see this coming, and we nonetheless see the transits are nonetheless approach decrease than it was final yr. The variety of transits accessible. And for those who suppose that the brand new canal immediately solely takes round 7 a day transit. So — so for those who add 100 and 170 some ships beneath virtually 200 ships extra for that I can use a canal subsequent yr and lots of of them that could be a principal commerce route, and we see this — these rejections coming again.

So I feel to your query, when is it — when will we see a return, we predict fairly quickly inside this quarter, we are going to see this aligned as a result of I feel it has been overshot on the downward aspect. So we do see these items correcting themselves what we’re coming into the vacations in China quickly. In order that all the time put somewhat little bit of a humid available on the market. And in addition there are some cargos unsold within the water additionally Iranian tons that appears to be an issue to clear. So it may take a short time earlier than we see the bounce again inside this quarter, we do anticipate this to right of.

John Hadjipateras

Thanks, Tim. Thanks. I’d simply add that we are able to by no means actually inform which quarter it should occur. We may give you what we predict is steering have been a mean for the remainder of the yr or no matter. However hopefully, the market will react. And the query is, when it bounces, how nicely it bounces. In order I stated, I feel, earlier than, when the market begins falling, they type of overlook the place to cease. So I feel we’ll hit extra shortly after which bounce again, however.

Omar Nokta

Sure. No, that is very useful. And that is sensible, John, you simply stated and clearly, Tim, excellent coloration. I admire you type of going into element there. After which only a couple extra for me and I will flip it over. Possibly simply first — form of subsequent query is simply on the Purple Sea. Clearly, it has been very, very topical and entrance and heart actually over the previous few weeks. How would you measurement up the affect of what is going on on within the Purple Sea with the diversions. How do you measurement what that affect on the VLGC commerce keep compared to what we have been seeing or had seen within the Panama Canal final yr.

John Hadjipateras

It is not so apparent, Omar, as a result of the commerce by the canal — by the Suez Canal was virtually type of brought on by the congestion of who — in Panama. Additionally, the — so the Suez Canal now itself, I am unsure. The Purple Sea commerce had — the primary VLGC commerce out of the Purple Sea is out of Jordan and in Jordan — Sorry, not out of Jordan, out of Saudi Arabia, Yanbu. And Jordan has absorbed a number of the cargoes that will in any other case have gone East from Yanbu.

And that has displaced some cargoes that will have come from the state. So that could be a unfavorable on the ton mile. However, Saudi may divert the loading of the cargo from Jordan to Rastadora, which most likely will not occur. In order that whole variety of ships popping out of the Purple Sea was, I feel, 4 to five a month out of Yanbu, representing about 30% of the exports from Saudi Arabia. So it is not — it is — as a result of we’re in a flux, so I do not suppose it is easy to type of predict what the eventual affect of the hostilities in that area will likely be — to inform you that I do not know.

Omar Nokta

I admire you trying to — or a minimum of summarizing all that, that is useful context as nicely. After which perhaps only a last one for me. Simply on the newbuilding and simply type of fascinated with John Lycouris feedback about outfitting the present fleet to hold ammonia. I suppose only one query on that will be what does the price seem like to improve for ammonia? After which additionally by way of the brand new constructing, is there a value distinction in ordering a VLAC versus a VLGC? And perhaps simply, I suppose, a number of questions, however what is the distinction between the VLAC and the VLGC, I suppose, going ahead?

John Lycouris

Sure, Omar, it’s a price that over quite a lot of ships goes to be fairly low. However we’re — we have now been trying into this for some years now. And we predict that it’s considerably lower than $5 million and doubtless even decrease than that when it’s amortized over quite a lot of ships. So it’s one thing that’s, as an example, it takes time, however it’s not a major price to hold out these conversions.

John Hadjipateras

Omar, we’re aware of that as a result of it — because it applies to our — not all our ships, however a few of our ships, it additionally applies to an excellent variety of the world fleet. So folks — we form of get too carried away with new constructing devoted ammonia carriers on an excellent a part of the fleet, the present fleet of VLGCs may very well be — could also be much less environment friendly than a brand new ship, however they might nonetheless carry ammonia with some modifications and upgrades.

Omar Nokta

Understood.

Operator

Our Subsequent query is from the road of Øystein Vaagen with Fearnley Securities.

Øystein Vaagen

Only a fast query for me. As you simply mentioned, your charges have been fairly excessive over the past couple of months on this winter establishing the excessive. However you booked $91,000 roughly on the spot and pool for the fourth quarter. However once more, that is not likely on the highest as we noticed spot charges go to $114,000. Now you are speaking concerning the $100,000, which I suppose is sensible as ship house owners take some protection on the way in which up. However my query is now spot price in its now under money breakeven ranges and near OpEx. What sort of ranges are you fixing at immediately? Does it work in a different way on the way in which down as nicely?

Ted Younger

Properly, I would say a few issues. To start with, simply to be clear, the outcomes that we talked about going ahead, there’s a measure of time constitution ships in there that are decrease. The spot market charges which might be booked in that ahead quantity they’re very engaging. And as for present fixing, look, that is fairly commercially delicate data. We have now a normal matter do not actually touch upon it. However Tim was to provide somewhat bit extra he could, however I would say generally, once we’ve thought when he described his technique to us, look, our guys have been proving to be fairly good at determining when cargoes are going to be accessible and what number of ships are going to have the ability to meet the lake in and type of flexing our planning round that.

Tim, if you wish to add something to that, be at liberty or not.

Tim Hansen

Sure, you may say that the drop was fairly fast. So solely issues that has been fastened was type of like what was within the entrance. So I ought to say, you’re taking a few the way in which down, however truly, we had fastened fairly far ahead already. So we did not have a lot to repair within the fixing window when market drops. So — so most of our positions comes solely accessible greater than a month forward from now.

In order the market has been dropping, then folks would not repair that far forward. So we’re not likely that a lot of the fixing window but. So we’ll see if it turns round earlier than we get there. However sure.

Øystein Vaagen

And simply so as to add on, you fixing window now available in the market generally? Is that early March now? Or the place are we now?

John Hadjipateras

We could not – sorry, however we don’t need to go an excessive amount of into the market.

A –Ted Younger

It’s commercially delicate.

A –John Hadjipateras

Sure.

Operator

We have reached the tip of the question-and-answer session. I’ll now flip the decision over to John Hadjipateras for closing remarks.

John Hadjipateras

Thanks, Rob. Thanks to your questions — valued questioners, and have an excellent quarter, have an excellent February and see you subsequent time.