Navigator Holdings Ltd. Preliminary First Quarter 2023 Results (Unaudited)
Press Releases

Navigator Holdings Ltd. Preliminary First Quarter 2023 Results (Unaudited)






NEW YORK and LONDON, May 22, 2023 (GLOBE NEWSWIRE) —  

Highlights

  • Navigator Holdings Ltd. (the "Company", "we", "our" and "us") (NYSE: NVGS) reported operating revenue of $136.0 million for the three months ended March 31, 2023, compared to $119.8 million for the three months ended March 31, 2022.
  • Net income was $18.8 million for the three months ended March 31, 2023, compared to $27.0 million for the three months ended March 31, 2022.
  • Earnings per share was $0.25 for the three months ended March 31, 2023, compared to $0.35 for the three months ended March 31, 2022. Adjusted Earnings per share, to exclude unrealized gains or losses on non-designated derivative instruments was $0.31 for the three months ended March 31, 2023, compared to $0.15 for the three months ended March 31, 2022.
  • Adjusted EBITDA(1) was a record $69.0 million for the three months ended March 31, 2023, compared to $55.7 million for the three months ended March 31, 2022.
  • Fleet utilization increased to 96.2% for the three months ended March 31, 2023, compared to 89.5% for the three months ended March 31, 2022.
  • Average daily time charter equivalent ("TCE") rate was $25,620 for the three months ended March 31, 2023, compared to $22,933 for the three months ended March 31, 2022.
  • The ethylene export marine terminal at Morgan’s Point, Texas on the Houston Ship Channel (“Ethylene Export Terminal") had throughput volumes of 250,731 tons for the three months ended March 31, 2023, compared to 267,110 tons for the three months ended March 31, 2022 in line with the quarterly nameplate capacity of 250,000 tons.
  • The Company entered into a new $200.0 million senior secured term loan to refinance two credit facilities that were due to mature in 2023. No loan facilities are now due to expire until 2025.
  • Our Navigator Greater Bay Joint Venture acquired a further four vessels, a 17,000 cbm, 2018-built ethylene capable liquefied gas carrier, Navigator Solar and three 22,000 cbm, 2019-built ethylene capable liquefied gas carriers Navigator Castor and Navigator Equator during the first quarter and Navigator Vega on April 13, 2023.
  • On May 2, 2023, the Company sold and delivered its oldest vessel, Navigator Orion, a 2000 built 22,085 cbm ethylene capable semi-refrigerated handysize carrier to a third party for $20.9 million.
  • The Company’s previously announced $50.0 million share repurchase plan (the “2022 Plan”) was completed in May, 2023. Under the 2022 Plan, the Company repurchased and cancelled 3,809,947 common shares, amounting to around 4.9% of the outstanding common shares available immediately before the 2022 Plan was announced in October, 2022, for a total of $50.0 million, equating to an average price of $13.12 per share.
  • The Company announces a new return of capital policy incorporating a new share repurchase plan pursuant to which the Company may repurchase up to an aggregate of $25.0 million of the Company’s shares of common stock, as well as a future dividend policy. Commencing with the dividend with respect to the second quarter of 2023, the Company intends, subject to operating needs and other circumstances, to pay a quarterly cash dividend of $0.05 per share (the “Fixed Element”) and return additional capital in the form of additional cash dividends and/or share repurchases, such that the Fixed Element and, if any, the variable component, together, equal 25% of net income for the applicable quarter. Declarations of any dividends in the future, and the amount of any such dividends, are subject to approval by the Company’s Board of Directors.

Recent Developments

Share Repurchase Program and New Return of Capital Policy

The Company previously announced the Board’s authorization for a share repurchase program of up to $50.0 million of its common stock, to be implemented via open market purchases, privately negotiated transactions, or in accordance with an approved trading plan (under Rule 10b5-1). As of March 31, 2023, the Company had purchased and canceled 2,622,149 shares of common stock for a total amount of approximately $33.6 million (an average price of $12.73 per share). Since March 31, 2023, the Company has purchased and canceled a further 1,187,798 shares of common stock for a total amount of approximately $16.4 million, thereby completing the $50.0 million share repurchase program.

The Company announces a return of capital policy incorporating a new share repurchase plan, authorized by the Company’s Board of Directors, pursuant to which the Company may repurchase up to an aggregate of $25.0 million of the Company’s shares of common stock, as well as a future dividend policy (together, the “Capital Return Policy”). Commencing with the dividend in respect of the second quarter of 2023, the Company intends, subject to operating needs and other circumstances, to pay a quarterly cash dividend of $0.05 per share (the “Fixed Element”) and return additional capital in the form of additional cash dividends and/or share repurchases, such that the Fixed Element and, if any, the variable element, together, equal 25% of net income for the applicable quarter.

Any acquisition of the Company’s common stock under the Capital Return Policy can be made via open market transactions, privately negotiated transactions or any other method permitted under U.S. securities laws and the rules of the U.S. Securities and Exchange Commission. The timing and amount of any dividends and share repurchases under the Capital Return Policy will be determined by Navigator’s Board of Directors and management and will depend on market conditions, legal requirements, stock price and alternative uses of capital, financial results and earnings, restrictions in our debt agreements, required capital expenditures and the provisions of Marshall Islands law affecting the payment of dividends to shareholders, as well as other factors. The Capital Return Policy does not oblige Navigator to pay any dividends or repurchase any of its shares and the Capital Return Policy, including dividends and repurchases of shares of common stock, may be suspended, discontinued or modified by the Company at any time, for any reason.

Ethylene Export Terminal

The Ethylene Export Terminal had a throughput during the first quarter of 2023 totaling 250,731 metric tons, compared to 267,110 tons during the first quarter of 2022.

We, together with our joint venture partner have agreed to the Terminal Expansion Project, increasing the export capacity from approximately one million tons per year to at least 1.55 million tons and up to three million tons per year. Long lead items have already been ordered and construction which is expected to be completed in the second half of 2024, has commenced. The total capital contributions required from us to the Export Terminal Joint Venture for the Terminal Expansion Project are expected to be approximately $125 million which the Company expects to finance using existing cash resources, distributions from the Export Terminal Joint Venture during the course of the expansion and additional debt.

Shipping Trends

Charter rates for the handysize LPG vessel segment continued an upward trajectory through the first quarter of 2023. Both the handysize 12-month market assessment for semi-refrigerated and fully-refrigerated vessels increased by $10,000 per calendar month (“pcm”) to $760,000 pcm, and $740,000 pcm respectively, and the handysize ethylene assessment increased $85,000 pcm to $975,000 pcm during the first quarter.

The continued robustness of all three handysize vessel sub-segments is primarily attributed to the following factors. First, the geopolitical conflict around Ukraine continues to disrupt traditional ammonia trade flows. The Ukrainian port of Yuzhnyy, which historically exported approximately 10% of the world’s seaborne ammonia, remains out of operation. In addition, ammonia originating from the Russian Baltic Sea area continues to experience delays and therefore European ammonia consumers were sourced the commodity from further distances, increasing ton mile and thus increasing the demand for handysize shipping. However, European ammonia demand has declined during the past month due to the normalization of natural gas prices, although the increased ammonia ship demand within the handysize segment has remained.

Secondly, the U.S. continues to export record volumes of LPG, increasing week on week, compared to the same time period last year. The U.S. exported a record 5.5 million tons of LPG during March 2023, providing improved employment opportunities across all the gas carrier segments.

Finally, North American ethane remains competitively priced enabling a sustainable floor for cheap domestic production of ethylene. The arbitrage for U.S. produced ethylene compared to international markets continues to be open, both to Europe and to Asia-Pacific consumers, which has given rise to continued throughput from our Ethylene Export Terminal, as well as demand for our ethylene capable vessels. The nameplate capacity ethylene exports from our terminal, in addition to significant U.S. ethane exports have supported an increase in the ethylene capable handysize ship segment.

Unaudited Results of Operations for the Three Months Ended March 31, 2023 Compared to the Three Months Ended March 31, 2022

The following table compares our operating results for the three months ended March 31, 2022 and 2023:

  Three Months
Ended
March 31, 2022
  Three Months
Ended
March 31, 2023
Percentage
Change
   
  (in thousands, except percentages)
Operating revenues $ 100,396     $ 116,610   16.2 %
Operating revenues – Unigas Pool   13,504       12,192   (9.7 %)
Operating revenues – Luna Pool collaborative arrangements   5,877       7,200   22.5 %
                   
Total operating revenues   119,777       136,002   13.5 %
                   
Expenses:                  
Brokerage commissions   1,407       1,694   20.4 %
Voyage expenses   20,796       17,229   (17.2 %)
Voyage expenses – Luna Pool collaborative arrangements   4,590       5,028   9.5 %
Vessel operating expenses   38,051       41,672   9.5 %
Depreciation and amortization   31,342       31,831   1.6 %
General and administrative costs   6,343       6,755   6.5 %
Profit from sale of vessel   (358 )        
Other income   (89 )     (96 ) 7.9 %
                   
Total operating expenses   102,082       104,113   2.0 %
                   
Operating income   17,695       31,889   80.2 %
Other income/(expense)                  
Foreign currency exchange loss on senior secured bonds   (777 )        
Unrealized gain/(loss) on non-designated derivative instruments   15,242       (4,251 )  
Write off of deferred financing costs         (171 )  
Interest expense   (10,963 )     (13,338 ) 21.7 %
Interest income   87       583   570.1 %
                   
Income before taxes and share of result of equity method investments   21,284       14,712   (30.9 %)
Income taxes   (393 )     (1,164 ) 196.2 %
Share of result of equity method investments   6,503       5,302   (18.5 %)
                   
Net income   27,394       18,850   (31.2 %)
Net income attributable to non-controlling interest   (356 )     (64 ) (82.0 %)
                   
Net income attributable to stockholders of Navigator Holdings Ltd. $ 27,038     $ 18,786   (30.5 %)
                    

Operating Revenues. Operating revenues, net of address commissions, was $116.6 million for the three months ended March 31, 2023, an increase of $16.2 million or 16.2% compared to $100.4 million for the three months ended March 31, 2022. This increase was primarily due to:

  • an increase in operating revenues of approximately $9.7 million attributable to an increase in average monthly time charter equivalent rates, which increased to an average of approximately $25,620 per vessel per day ($779,275 per vessel per calendar month) for the three months ended March 31, 2023, compared to an average of approximately $22,933 per vessel per day ($697,549 per vessel per calendar month) for the three months ended March 31, 2022;
  • an increase in operating revenues of approximately $7.0 million attributable to an increase in fleet utilization, which rose to 96.2% for the three months ended March 31, 2023, compared to 89.5% for the three months ended March 31, 2022;
  • an increase in operating revenues of approximately $3.1 million attributable to a 151 day increase in vessel available days, or 3.9% for the three months ended March 31, 2023, compared to the three months ended March 31, 2022. This increase was in part as a result of the acquisition of three additional handysize vessels by the Navigator Greater Bay Joint Venture during the three months ended March 31, 2023 and in part as a result of fewer vessels in drydock for the three months ended March 31, 2023, compared to the three months ended March 31, 2022; and
  • a decrease in operating revenues of approximately $3.6 million primarily attributable to a decrease in pass through voyage costs for the three months ended March 31, 2023, compared to the three months ended March 31, 2022.

The following table presents selected operating data for the three months ended March 31, 2022, and 2023, which we believe are useful in understanding the basis for movement in our operating revenues. It does not include our nine owned smaller vessels in the independent commercially managed Unigas Pool or the vessels owned by Pacific Gas in our Luna Pool prior to their acquisition by the Navigator Greater Bay Joint Venture.

  Three Months
Ended
March 31, 2022
  Three Months
Ended
March 31, 2023
Fleet Data:        
Weighted average number of vessels   44.2     45.0  
Ownership days   3,974     4,048  
Available days   3,879     4,030  
Earning days   3,471     3,879  
Fleet utilization   89.5%     96.2%  
Average daily time charter equivalent rate (*) $ 22,933   $ 25,620  

*  Non-GAAP Financial Measure—Time charter equivalent: Time charter equivalent (“TCE”) rate is a measure of the average daily revenue performance of a vessel. TCE is not calculated in accordance with U.S. GAAP. For all charters, we calculate TCE by dividing total operating revenues (excluding collaborative arrangements and revenues from the Unigas Pool), less any voyage expenses (excluding collaborative arrangements), by the number of earning days for the relevant period. TCE rates exclude the effects of the collaborative arrangements, as earning days and fleet utilization, on which TCE rates are based, are calculated for our owned vessels, and not the average of all pool vessels. Under a time charter, the charterer pays substantially all of the vessel voyage related expenses, whereas for voyage charters, also known as spot market charters, we pay all voyage expenses. TCE rate is a shipping industry performance measure used primarily to compare period-to-period changes in a company’s performance despite changes in the mix of charter types (i.e., spot charters, time charters and contracts of affreightment) under which the vessels may be employed between the periods. We include average daily TCE rate, as we believe it provides additional meaningful information in conjunction with net operating revenues, because it assists our management in making decisions regarding the deployment and use of our vessels and in evaluating their financial performance. Our calculation of TCE rate may not be comparable to that reported by other companies.

Reconciliation of Operating Revenues to TCE rate

The following table represents a reconciliation of operating revenues to TCE rate. Operating revenues are the most directly comparable financial measure calculated in accordance with U.S. GAAP for the periods presented.

  Three Months
Ended
March 31, 2022
  Three Months
Ended
March 31, 2023
   
  (in thousands, except earning days
and average daily time charter equivalent rate)
Fleet Data:          
Operating revenues* $ 100,396   $ 116,610
Voyage expenses*   20,796     17,229
           
Operating revenues less Voyage expenses   79,600     99,381
           
Earning days   3,471     3,879
Average daily time charter equivalent rate $ 22,933   $ 25,620

*Operating revenues and voyage expenses excluding collaborative arrangements and Unigas pool.

Operating Revenues – Unigas Pool. Operating revenues – Unigas Pool was $12.2 million for the three months ended March 31,2023 compared to $13.5 million for the three months ended March 31, 2022 and represents our share of the revenues earned from our nine vessels operating within the Unigas Pool, based on agreed pool points.

Operating Revenues – Luna Pool Collaborative Arrangements. Pool earnings are aggregated and then allocated (after deducting pool overheads and managers’ fees) to the Pool Participants in accordance with the Pooling Agreement. Operating revenues – Luna Pool collaborative arrangements was $7.2 million for the three months ended March 31, 2023, compared to $5.9 million for the three months ended March 31, 2022 and represents our share of pool net revenues generated by the other participant’s vessels in the pool, prior to their acquisition by the Navigator Greater Bay Joint Venture. This increase was primarily as a result of increased charter rates achieved by the ethylene vessels in the Luna Pool for the three months ended March 31, 2023 compared the three months ended March 31, 2022. Operating Revenues – Luna Pool Collaborative Arrangements will cease following the acquisition of Navigator Vega by the Navigator Greater Bay Joint Venture on April 13, 2023, which was the final vessel previously owned by the other pool participant.

Brokerage Commissions. Brokerage commissions, which typically vary between 1.25% and 2.5% of operating revenues, increased by $0.3 million or 20.4% to $1.7 million for the three months ended March 31, 2023, from $1.4 million for the three months ended March 31, 2022, primarily due to an increase in operating revenues on which brokerage commissions are based.

Voyage Expenses. Voyage expenses decreased by $3.6 million or 17.2% to $17.2 million for the three months ended March 31, 2023, from $20.8 million for the three months ended March 31, 2022. These voyage expenses are pass through costs, corresponding to a decrease in operating revenues of the same amount.

Voyage Expenses – Luna Pool Collaborative Arrangements. Voyage expenses – Luna Pool collaborative arrangements were $5.0 million for the three months ended March 31, 2023, compared to $4.6 million for the three months ended March 31, 2022. These voyage expenses – Luna Pool collaborative arrangements represent the other participant’s share of pool net revenues generated by both our vessels and those of the Navigator Greater Bay Joint Venture in the pool. The net effect after deducting operating revenues – Luna Pool collaborative arrangements was that the other participant’s vessels contributed $2.2 million to the Company in the Luna Pool for the three months ended March 31, 2023, compared to the other participant’s vessels contributing $1.3 million to our vessels for the three months ended March 31, 2022.

Vessel Operating Expenses. Vessel operating expenses increased by $3.6 million or 9.5% to $41.7 million for the three months ended March 31, 2023, from $38.1 million for the three months ended March 31, 2022. Average daily vessel operating expenses increased by $739 per vessel per day, or 9.4%, to $8,580 per vessel per day for the three months ended March 31, 2023, compared to $7,841 per vessel per day for the three months ended March 31, 2022.

Depreciation and Amortization. Depreciation and amortization increased by $0.5 million or 1.6% to $31.8 million for the three months ended March 31, 2023, from $31.3 million for the three months ended March 31, 2022. This increase was primarily as a result of the acquisition of three additional handysize vessels by the Navigator Greater Bay Joint Venture during the three months ended March 31, 2023. Depreciation and amortization included amortization of capitalized drydocking costs of $4.6 million and $4.1 million for the three months ended March 31, 2023 and 2022, respectively.

General and Administrative Costs. General and administrative costs increased by $0.4 million or 6.5% to $6.8 million for the three months ended March 31, 2023, from $6.3 million for the three months ended March 31, 2022.

Profit from Sale of Vessel. No vessels were sold during the three months ended March 31, 2023. Profit from sale of vessel for the three months ended March 31, 2022 was $0.4 million and related to the sale of the vessel, Happy Bird. The sale of Navigator Neptune in January 2022 was at book value, therefore there was no profit or loss on the sale of this vessel.

Other Income. Other income was $0.1 million for both the three months ended March 31, 2023 and 2022 and consists of that portion of the management fees for commercial and administrative activities performed by the Company for the Luna Pool, relating to the other participant’s vessels. Other income will cease once all the other participant’s vessels are acquired by the Navigator Greater Bay Joint Venture.

Non-operating Results

Foreign Currency Exchange Loss on Senior Secured Bonds.  The Norwegian Kroner 2018 Bonds were repaid in December 2022 and no exchange gains and losses were recorded for the three months ended March 31, 2023. A foreign currency exchange loss of $0.8 million was incurred for the three months ended March 31, 2022 as a result of the Norwegian Kroner strengthening against the U.S. Dollar, being NOK 8.7 to USD 1.0 as of March 31, 2022, compared to NOK 8.8 to USD 1.0 as of December 31, 2021.

Unrealized Gains/ (Losses) on Non-designated Derivative Instruments. The unrealized loss of $4.3 million on non-designated derivative instruments for the three months ended March 31, 2023 relates to the fair value losses of our interest rate swaps across a number of our secured term loan and revolving credit facilities, as a result of decreases in forward U.S. Libor rates relative to the fixed rates applicable on these secured term loan and revolving credit facilities. This compared to unrealized gains on non-designated derivative instruments of $15.2 million for the three months ended March 31, 2022, which primarily related to the fair value gains of our interest rate swaps of $13.0 million, as a result of significant increases in forward U.S. Libor rates and a gain in our cross-currency interest rate swap of $2.2 million, which was due to the strengthening of the Norwegian Kroner against the U.S. Dollar.

Interest Expense. Interest expense increased by $2.4 million, or 21.8%, to $13.3 million for the three months ended March 31, 2023, from $11.0 million for the three months ended March 31, 2022. This is primarily as a result of increases in U.S. Libor and SOFR rates.

Income Taxes. Income taxes related to taxes on our subsidiaries incorporated in the United States of America, as well as other countries around the world where we have subsidiaries. Income taxes increased to $1.2 million for the three months ended March 31, 2023, compared $0.4 million for the three months ended March 31, 2022, primarily as a result of current and deferred taxes on our portion of the profits from the Ethylene Export Terminal.

Share of Result of Equity Method Investments. The share of the result of the Company’s 50% ownership in the Export Terminal Joint Venture was an income of $5.3 million for the three months ended March 31, 2023, compared to an income of $6.5 million for the three months ended March 31, 2022. This decrease is a result of decreased volumes exported through the Ethylene Export Terminal, of 250,731 tons for the three months ended March 31, 2023, compared to 267,110 tons for the three months ended March 31, 2022, as well as a decrease in throughput charges which is correlated to US domestic natural gas pricing.

Non-Controlling Interest. We entered into a sale and leaseback arrangement in November 2019 with a wholly-owned special purpose vehicle (“lessor SPV”) of a financial institution. Although we do not hold any equity investments in this lessor SPV, we have determined that we are the primary beneficiary of this entity and accordingly, we are required to consolidate this VIE into our financial results. The net income attributable to the financial institution was $0.3 million and is presented as the non-controlling interest in our financial results for both the three months ended March 31, 2023, and 2022.

In September 2022, the Company entered into the Navigator Greater Bay Joint Venture to acquire five ethylene vessels, Navigator Luna, Navigator Solar, Navigator Castor, Navigator Equator and Navigator Vega. The Joint Venture is owned 60% by the Company and 40% by Greater Bay Gas. The Navigator Greater Bay Joint Venture is accounted for as a consolidated subsidiary in our consolidated financial statements, with the 40% owned by Greater Bay Gas accounted for as a non-controlling interest. A loss attributable to Greater Bay Gas of $0.2 million is presented as the non-controlling interest in our financial results for the three months ended March 31, 2023.

Reconciliation of Non-GAAP Financial Measures

The following table sets forth a reconciliation of net income to EBITDA and Adjusted EBITDA for the three months ended March 31, 2022 and 2023:

  Three months ended
  March 31,
2022
  March 31,
2023
  (in thousands)
Net income $ 27,394   $ 18,786
Net interest expense   10,876     12,775
Income taxes   393     1,164
Depreciation and amortization   31,342     31,831
           
EBITDA(1) $ 70,125   $ 64,556
Foreign currency exchange loss/(gain) on senior secured bonds   777    
Unrealized (gain)/ loss on non-designated derivative instruments   (15,242)     4,251
Write off of deferred financing costs       171
           
Adjusted EBITDA(1) $ 55,660   $ 68,978
           

1 EBITDA and Adjusted EBITDA are not measurements prepared in accordance with U.S. GAAP (non-GAAP financial measures). EBITDA represents net income before net interest expense, income taxes, depreciation and amortization. We define Adjusted EBITDA as EBITDA before foreign currency exchange gain or loss on senior secured bonds, unrealized gain or loss on non-designated derivative instruments and write off of deferred financing costs. Management believes that EBITDA and Adjusted EBITDA are useful to investors in evaluating the operating performance of the Company. EBITDA and Adjusted EBITDA do not represent and should not be considered alternatives to consolidated net income, cash generated from operations or any measure prepared in accordance with U.S. GAAP, and our calculation of EBITDA and Adjusted EBITDA may not be comparable to that reported by other companies.

Our Fleet

The following table sets forth our vessels as of May 19, 2023:

Operating Vessel   Year
Built
  Vessel Size
(cbm)
  Employment
Status
  Current
Cargo
  Time Charter
Expiration Date
Ethylene/ethane capable semi-refrigerated midsize                    
Navigator Aurora   2016   37,300   Time Charter   Ethane   December 2026
Navigator Eclipse   2016   37,300   Time Charter   Ethane   March 2026
Navigator Nova   2017   37,300   Time Charter   Ethane   September 2026
Navigator Prominence   2017   37,300   Time Charter   Ethane   March 2025
                     
Ethylene/ethane capable semi-refrigerated handysize                    
Navigator Pluto*   2000   22,085   Spot Market   Ethylene  
Navigator Saturn*   2000   22,085      
Navigator Venus*   2000   22,085   Spot Market   Ethylene  
Navigator Atlas*   2014   21,000   Spot Market   Ethylene  
Navigator Europa*   2014   21,000   Time Charter   Ethane   December 2023
Navigator Oberon*   2014   21,000   Spot Market   Ethylene  
Navigator Triton*   2015   21,000   Spot Market   Ethylene  
Navigator Umbrio*   2015   21,000   Time Charter   Ethylene   December 2023
Navigator Luna*   2018   17,000   Spot Market   Ethylene  
Navigator Solar*   2018   17,000   Spot Market   Ethylene  
Navigator Castor*   2019   22,000   Spot Market   Ethylene  
Navigator Equator*   2019   22,000   Spot Market   Ethylene  
Navigator Vega*   2019   22,000   Time Charter   Ethylene   October 2023
                     
Ethylene/ethane capable semi-refrigerated smaller size                    
Happy Condor**   2008   9,000   Unigas Pool    
Happy Pelican**   2012   6,800   Unigas Pool    
Happy Penguin**   2013   6,800   Unigas Pool    
Happy Kestrel**   2013   12,000   Unigas Pool    
Happy Osprey**   2013   12,000   Unigas Pool    
Happy Peregrine**   2014   12,000   Unigas Pool    
Happy Albatross**   2015   12,000   Unigas Pool    
Happy Avocet**   2017   12,000   Unigas Pool    
                     
Semi-refrigerated handysize                    
Navigator Aries   2008   20,750   Time Charter   LPG   January 2024
Navigator Capricorn   2008   20,750   Time Charter   LPG   July 2023
Navigator Gemini   2009   20,750      
Navigator Pegasus   2009   22,200   Time Charter   Propylene   September 2023
Navigator Phoenix   2009   22,200   Time Charter   Ammonia   August 2023
Navigator Scorpio   2009   20,750   Time Charter   LPG   January 2024
Navigator Taurus   2009   20,750   Time Charter   Ammonia   July 2023
Navigator Virgo   2009   20,750   Time Charter   LPG   July 2023
Navigator Leo   2011   20,600   Time Charter   LPG   December 2023
Navigator Libra   2012   20,600   Time Charter   LPG   December 2023
Atlantic Gas   2014   22,000   Time Charter   LPG   August 2023
Adriatic Gas   2015   22,000   Time Charter   LPG   November 2023
Balearic Gas   2015   22,000   Spot Market   LPG  
Celtic Gas   2015   22,000   Time Charter   LPG   June 2023
Navigator Centauri   2015   21,000   Time Charter   LPG   May 2024
Navigator Ceres   2015   21,000   Time Charter   LPG   June 2024
Navigator Ceto   2016   21,000   Time Charter   LPG   May 2024
Navigator Copernico   2016   21,000   Time Charter   LPG   May 2024
Bering Gas   2016   22,000   Spot Market   Butadiene  
Navigator Luga   2017   22,000   Time Charter   LPG   July 2024
Navigator Yauza   2017   22,000   Time Charter   LPG   July 2024
Arctic Gas   2017   22,000   Time Charter   LPG   June 2023
Pacific Gas   2017   22,000   Time Charter   LPG   November 2023
                     
Semi-refrigerated smaller size                    
Happy Falcon**   2002   3,770   Unigas Pool      
                     
Fully-refrigerated                    
Navigator Glory   2010   22,500   Time Charter   Ammonia   June 2025
Navigator Grace   2010   22,500   Time Charter   Ammonia   January 2024
Navigator Galaxy   2011   22,500   Time Charter   Ammonia   December 2023
Navigator Genesis   2011   22,500   Time Charter   Ammonia   January 2024
Navigator Global   2011   22,500   Time Charter   LPG   June 2023
Navigator Gusto   2011   22,500   Time Charter   Ammonia   March 2024
Navigator Jorf   2017   38,000   Time Charter   Ammonia   August 2027
                     

* denotes our owned vessels that operate within the Luna Pool
** denotes our owned vessels that operate within the independently managed Unigas Pool

Conference Call Details:

Tomorrow, Tuesday, May 23, 2023 at 10:00 A.M. ET, the Company’s management team will host a conference call to discuss the preliminary financial results.

Zoom Conference Call Details
Participants should register for the conference call and slide presentation through the following link:

https://us06web.zoom.us/webinar/register/WN_QmTXpY_GQi2meQrgb-nPIQ#/registration

Or join by phone:
United States: +1 929 205 6099
United Kingdom: +44 330 088 5830

For a full list of US and international numbers available, please click on the link below:

International Dial-in numbers

Webinar ID: 815 4285 4397
Passcode: 995236

The conference call and slide presentation will be available for replay on Navigator’s website (www.navigatorgas.com) under Key Dates and All Reports in the Investors Centre section.

Audio Webcast:

There will also be a live, and then archived, webcast of the conference call, available through the Company’s website (www.navigatorgas.com). To listen to the live and archived audio file, visit our website www.navigatorgas.com and click on Key Dates under our Investors Centre page. Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

Navigator Gas

Attention: Investor Relations Department – investorrelations@navigatorgas.com orandy.giveans@navigatorgas.com

Houston: 333 Clay Street, Suite 2400, Houston, Texas, U.S.A. 77002 Tel: +1 713 373 6197
London: 10 Bressenden Place, London, SW1E 5DH. Tel: +44 (0)20 7340 4850

Investor Relations / Media Advisors
Nicolas Bornozis / Paul Lampoutis
Capital Link – New York
Tel: +1-212-661-7566
Email:   navigatorgas@capitallink.com

About Us
Navigator Holdings Ltd. is the owner and operator of the world’s largest fleet of handysize liquefied gas carriers and a global leader in the seaborne transportation services of petrochemical gases, such as ethylene and ethane, liquefied petroleum gas (“LPG”) and ammonia and owns a 50% share, through a joint venture, in an ethylene export marine terminal at Morgan’s Point, Texas on the Houston Ship Channel, USA. Navigator’s fleet now consists of 56 semi- or fully-refrigerated liquefied gas carriers, 25 of which are ethylene and ethane capable.  The Company plays a vital role in the liquefied gas supply chain for energy companies, industrial consumers and commodity traders, with its sophisticated vessels providing an efficient and reliable ‘floating pipeline’ between the parties, connecting the world today, creating a sustainable tomorrow.

NAVIGATOR HOLDINGS LTD.  
   
Condensed Consolidated Balance Sheets   
(Unaudited)  
   
  December 31, 2022   March 31, 2023  
   
  (in thousands, except share data)
Assets    
Current assets    
Cash, cash equivalents and restricted cash $ 153,194   $ 190,863  
Accounts receivable, net of allowance for credit losses   18,245     21,912  
Accrued income   9,367     4,100  
Prepaid expenses and other current assets   21,152     22,837  
Bunkers and lubricant oils   8,548     10,463  
Insurance receivable   1,452      
Amounts due from related parties   16,363     20,333  
             
Total current assets   228,321     270,508  
Non-current assets            
Vessels, net   1,692,494     1,790,942  
Assets held for sale       15,765  
Property, plant and equipment, net   198     133  
Intangible assets, net of accumulated amortization of $417 (December 31, 2022: $509)   239     196  
Equity method investments   148,534     145,390  
Derivative assets   21,955     17,704  
Right-of-use asset for operating leases   3,625     3,577  
Prepaid expenses and other non-current assets   1,372     355  
             
Total non-current assets   1,868,417     1,974,062  
             
Total assets $ 2,096,738   $ 2,244,570  
             
Liabilities and stockholders’ equity            
Current liabilities            
Current portion of secured term loan facilities, net of deferred financing costs $ 99,009   $ 117,197  
Current portion of operating lease liabilities   219     238  
Accounts payable   7,773     8,065  
Accrued expenses and other liabilities   24,708     21,050  
Accrued interest   4,211     2,970  
Deferred income   23,108     23,823  
Amounts due to related parties   595     555  
             
Total current liabilities   159,623     173,898  
             
Non-current liabilities            
Secured term loan facilities and revolving credit facilities, net of current portion and deferred financing costs   608,338     731,282  
Senior unsecured bond, net of deferred financing costs   98,943     99,042  
Operating lease liabilities, net of current portion   4,032     4,192  
Deferred tax liabilities   4,250     4,828  
Amounts due to related parties   48,140     46,476  
             
Total non-current liabilities   763,703     885,820  
             
Total Liabilities   923,326     1,059,718  
Commitments and contingencies            
Stockholders’ equity            
Common stock—$.01 par value per share; 400,000,000 shares authorized; 74,689,819 shares issued and outstanding, (December 31, 2022: 76,804,474)   769     747  
Additional paid-in capital   798,188     798,368  
Accumulated other comprehensive loss   (463)     (298)  
Retained earnings   364,000     354,700  
             
Total Navigator Holdings Ltd. stockholders’ equity   1,162,494     1,153,517  
Non-controlling interest   10,918     31,335  
             
Total equity   1,173,412     1,184,852  
             
Total liabilities and stockholders’ equity $ 2,096,738   $ 2,244,570  
             

Condensed Consolidated Statements of
Operations
(Unaudited)
  Three months ended
March 31,
(in thousands except share and per share data)
    2022     2023  
             
Revenues            
Operating revenues $ 100,396   $ 116,610  
Operating revenues – Unigas Pool   13,504     12,192  
Operating revenues – Luna Pool collaborative arrangements   5,877     7,200  
             
Total operating revenues $ 119,777   $ 136,002  
             
Expenses            
Brokerage commissions   1,407     1,694  
Voyage expenses   20,796     17,229  
Voyage expenses – Luna Pool collaborative arrangements   4,590     5,028  
Vessel operating expenses   38,051     41,672  
Depreciation and amortization   31,342     31,831  
General and administrative costs   6,343     6,755  
Profit from sale of vessel   (358)      
Other Income   (89)     (96)  
             
Total operating expenses   102,082   $ 104,113  
             
Operating income   17,695   $ 31,889  
Other income/(expense)            
Foreign currency exchange loss on senior secured bonds   (777)      
Unrealized gain/(loss) on non-designated derivative instruments   15,242     (4,251)  
Write off of deferred financing costs       (171)  
Interest expense   (10,963)     (13,338)  
Interest income   87     583  
             
Income before income taxes and share of result of equity method investments   21,284   $ 14,712  
Income taxes   (393)     (1,164)  
Share of result of equity method investments   6,503     5,302  
             
Net income   27,394   $ 18,850  
Net income attributable to non-controlling interest   (356)     (64)  
             
Net income attributable to stockholders of Navigator Holdings Ltd. $ 27,038   $ 18,786  
             
             
Earnings per share attributable to stockholders of Navigator Holdings Ltd.:            
Basic and diluted: $ 0.35   $ 0.25  
Weighted average number of shares outstanding:            
Basic:   77,193,048     75,955,162  
Diluted:   77,518,604     76,319,753  
             

Condensed Consolidated Statements of Cash
Flows
 
 (Unaudited)  
  Three Months
ended
March 31,
2022
  Three Months
ended
March 31,
2023
 
   
  (in thousands)
Cash flows from operating activities    
Net income $ 27,394   $ 18,850  
Adjustments to reconcile net income to net cash provided by operating activities    
Unrealized (gains)/losses on non-designated derivative instruments   (15,242)     4,251  
Depreciation and amortization   31,342     31,831  
Payment of drydocking costs   (4,426)     (2,908)  
Amortization of share-based compensation   136     180  
Amortization of deferred financing costs   1,002     922  
Share of result of equity method investments   (6,503)     (5,302)  
Profit from sale of vessel   (358)      
Unrealized foreign exchange loss on senior secured bonds   777      
Other unrealized foreign exchange gain/(loss)   152     (23)  
Changes in operating assets and liabilities        
Accounts receivable   10,671     (3,667)  
Insurance claim receivable   (516)     322  
Bunkers and lubricant oils   (970)     (1,915)  
Accrued income and prepaid expenses and other current assets   (6,634)     4,599  
Accounts payable, accrued interest, accrued expenses and other liabilities   5,147     (3,913)  
Amounts due to related parties   (7,758)     (3,970)  
             
Net cash provided by operating activities   34,216     39,257  
             
Cash flows from investing activities            
Additions to vessels and equipment   (546)     (142,883)  
Distributions from equity method investments   7,593     8,446  
Purchase of other property, plant and equipment   (2)     28  
Net proceeds from sale of vessels   26,449      
Insurance recoveries   871     1,265  
             
Net cash provided by/(used in) investing activities   34,365     (133,144)  
             
Cash flows from financing activities            
Proceeds from secured term loan facilities       291,813  
Issuance costs of secured term loan facilities       (3,151)  
Repurchase of share capital       (28,108)  
Repayment of vessel financing to related parties   (1,628)     (1,664)  
Repayment of secured term loan facilities and revolving credit facilities   (22,854)     (148,335)  
Cash received from non-controlling interest       20,353  
             
Net cash (used in)/provided by financing activities   (24,482)     130,908  
             
Effect of exchange rate changes on cash, cash equivalent and restricted cash   (202)     648  
Net increase in cash, cash equivalents and restricted cash   43,897     37,669  
Cash, cash equivalents and restricted cash at beginning of period   124,223     153,194  
             
Cash, cash equivalents and restricted cash at end of period $ 168,120   $ 190,863  
             
Supplemental Information            
Total interest paid during the period, net of amounts capitalized $ 11,606   $ 14,178  
             
Total tax paid during the period $   $ 169.1  
             

IMPORTANT INFORMATION REGARDING FORWARD-LOOKING STATEMENTS

This press release contains certain forward-looking statements concerning plans and objectives of management for future operations or economic performance, or assumptions related thereto, including our financial forecast. In addition, we and our representatives may from time to time make other oral or written statements that are also forward-looking statements. Such statements include, in particular, statements about our plans, strategies, business prospects, changes and trends in our business and the markets in which we operate as described in this press release. In some cases, you can identify the forward-looking statements by the use of words such as “may,” “could,” “should,” “would,” “expect,” “plan,” “anticipate,” “intend,” “forecast,” “believe,” “estimate,” “predict,” “propose,” “potential,” “continue,” “scheduled,” or the negative of these terms or other comparable terminology. Forward-looking statements appear in a number of places in this press release. These risks and uncertainties include but are not limited to:

  • future operating or financial results;
  • pending acquisitions, business strategy and expected capital spending;
  • operating expenses, availability of crew, number of off-hire days, drydocking requirements and insurance costs;
  • fluctuations in currencies and interest rates;
  • general market conditions and shipping market trends, including charter rates and factors affecting supply and demand;
  • our ability to continue to comply with all our debt covenants;
  • our financial condition and liquidity, including our ability to refinance our indebtedness as it matures or obtain additional financing in the future to fund capital expenditures, acquisitions and other corporate activities;
  • estimated future capital expenditures needed to preserve our capital base;
  • our expectations about the availability of vessels to purchase, or the useful lives of our vessels;
  • our continued ability to enter into long-term, fixed-rate time charters with our customers;    
  • our vessels engaging in ship to ship transfers of LPG or petrochemical cargoes which may ultimately be discharged in sanctioned areas or to sanctioned individuals without our knowledge;
  • the impact of the Russian invasion of Ukraine;
  • changes in governmental rules and regulations or actions taken by regulatory authorities;
  • global epidemics or other health crises such as the outbreak of COVID-19, including its impact on our business;
  • potential liability from future litigation;
  • our expectations relating to the payment of dividends;
  • our ability to maintain appropriate internal control over financial reporting and our disclosure controls and procedures;
  • our expectations regarding the financial success of the Ethylene Export Terminal and our related Export Terminal Joint Venture and our expectations regarding the completion of construction and financing, and the financial success of the Terminal Expansion Project;
  • our expectations regarding the financial success of our Luna Pool collaborative arrangement and our Navigator Greater Bay Joint Venture; and
  • other factors detailed from time to time in other periodic reports we file with the Securities and Exchange Commission.

All forward-looking statements included in this press release are made only as of the date of this press release. New factors emerge from time to time, and it is not possible for us to predict all of these factors. Further, we cannot assess the impact of each such factor on our business or the extent to which any factor, or combination of factors, may cause actual results to be materially different from those contained in any forward-looking statement. We expressly disclaim any obligation to update or revise any of these forward-looking statements, whether because of future events, new information, a change in our views or expectations, or otherwise. We make no prediction or statement about the performance of our common stock. 

Category: Financial

 

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