Dynagas LNG Partners (NYSE: DLNG)
Shares of Dynagas LNG Partners Company plunged by 11% on Wednesday after the company said it would reduce its dividend by more than 40%. The company said its quarterly distribution will reduce from $0.4225 a share to $0.25, or from $1.69 a share to $1.00 a share on an annual basis.
The new dividend takes effect on May 3, when shareholders will be paid for the first quarter of 2018 that closes on April 26. The company said the move was aimed at generating more annual cash savings.
DLNG Earnings & Outlook
Dynagas LNG Partners LP reported its fourth quarter earnings results on February 16. During the quarter the company posted earnings per share of $0.16 which missed the consensus estimate of $0.18.
During the fiscal year of 2017 the company reported revenue of $34.45 million which missed Wall Street projection of $36.07. Dynagas posted earnings per share of $0.74 for the fiscal year and revenue of $7.6 million during the quarter.
Dynagas LNG Partners CEO Comments
The Chief Executive Officer of the company made the following statement: “This decision by our Board of Directors to reduce the level of the Partnership’s quarterly common unit distribution is necessary to align the Partnership’s distribution level with its capacity to generate cash flow in the long term. Despite the material increase in the Partnership’s estimated revenue contract backlog over the last two years, we have experienced a decrease in operating cash flow and a weakened distribution coverage ratio (which is our distributable cash flow available for distribution in proportion to actual cash distributed) following our shift to longer term charters for the employment of our liquefied natural gas (LNG) carriers, which provide us with greater cash flow visibility albeit at lower charter rates that provide attractive returns of capital.”
Dynagas LNG Partners Company Profile
Dynagas is a limited partnership company that engages in the seaborne transportation sector globally. The company was incorporated in 2013 and is based in Monaco. Dynagas possesses and operates liquefied natural gas (LNG) carriers. Since March 9 2018, the company had a fleet consisting of six liquefied natural gas carriers with a total carrying capacity of about 914,000 cubic meters.
Dynagas Ltd serves as the manager of the company and is in charge of the fleet. Dynagas GP LLC is the general partner of Dynagas LNG Partners LP. The company has a market capitalization of $533 million. –Reuters
