Dynagas LNG Partners LP Q4 FY2023 earnings call

• All six LNG carriers in the fleet were operating under long-term charters with international gas companies.
• Fourth quarter 2023 net income was $10.5 million, slightly down from the same quarter prior year due to factors like decrease in unrealized gain on interest rate swap and absence of debt extinguishment gain, but mitigated by increased voyage revenues and other income.
• Adjusted net income for the quarter was $10.3 million, up from the prior year.
• Net debt to last 12 months' EBITDA ratio improved to 3.7 times, balance sheet is solid with book equity value of $448 million.
• Concluded the quarter with strong cash position of $73.8 million, operating cash flow of $20.2 million, and free cash flow of $17.4 million.
• Signed a term sheet with an Asian leasing company for lease financing of four LNG carriers, expected to close in Q2 2024 to repay debt maturing in September 2024.

For the fourth quarter of 2023, Dynagas LNG Partners reported net income of $10.5 million and earnings per common unit of $0.21. Adjusted net income stood at $10.3 million, and adjusted EBITDA for the full year 2023 reached $94.4 million. The fleet of six LNG carriers operated under long-term charters. In the fourth quarter, voyage revenues increased by $3.9 million due to a higher charter rate on the Arctic Aurora, and other income from insurance claims was $2.9 million. The time charter equivalent rate per day for the fourth quarter was $65,700 with operating expenses at $15,172 per day, and the net debt to last 12 months' EBITDA ratio improved to 3.7 times.

• The term sheet with the Asian leasing company is expected to close in the second quarter of 2024.
• Intends to use proceeds from the new financing and other liquidity sources to fully repay debt maturing in September 2024.
• Anticipate long-term demand for LNG to remain robust due to factors like its favorable emission profile, growing global demand for electrification, etc.

• Short-term challenges in charter market due to front-loaded vessel deliveries compared to multi-year growth in energy production.
• President Biden's temporary pause on pending permits for new energy projects, but not targeting already permitted or expansion projects.

Q: Ben Nolan with Stifel asked about cash outflows on a quarterly basis, interest amortization, and what to do with excess cash after debt service.

A: Michael Gregos said the financing has an average profile of about eight years, margin is below current levels, and it's too early to say what will be done with excess cash after closing the financing; Tony Lauritzen mentioned details on debt service elements like principal and interest, and Michael Gregos added there are no restrictions on using excess cash and no dividend restrictions