Golar LNG Interim results for the period ended 30 September 2017

Golar reports today a 3Q 2017 operating loss of $22.9 million as compared to a 2Q 2017 loss of $24.0 million.  A pick-up in utilization toward the end of the quarter resulted in a small rise in time charter revenues which increased $1.0 million to $25.0 million in 3Q 2017. Voyage expenses increased from $11.8 million in 2Q 2017 to $13.1 million in 3Q 2017, with the increase largely attributable to repositioning and cool-down costs for the Golar Tundra which departed Ghana in September and prepared for service as an LNG carrier.

As a result of higher fleet management and general vessel maintenance costs, vessel operating expenses increased $1.7 million to $13.8 million in 3Q 2017. Administration and depreciation and amortization costs at $11.0 million and $17.4 million, respectively, were in line with 2Q 2017.
  
Highlights
·         Operating Loss and EBITDA* in the quarter reported a loss of $22.9 million and $5.5 million, respectively, compared to a 2Q 2017 loss of $24.0 million and $6.6 million, respectively.

·         Committed to sell an interest in the FLNG Hilli Episeyo (“Hilli”) to Golar LNG Partners (“Golar Partners”).

·         Iain Ross appointed as CEO.

Subsequent Events
Golar Partners closes a Series A Preferred Unit offering raising net proceeds of $134 million.

Golar Partners issues first 50% of Incentive Distribution Right reset Earn-Out Units to Golar.

LNG shipping market shows solid signs of recovery in 4Q.

FLNG Hilli on site in Cameroon with production expected to commence shortly.

In 3Q 2017 the Company generated a net loss of $43.9 million. Notable contributors to this are summarized as follows:
      ·         The $7.1 million decrease in interest expense is the result of an adjustment to reflect capitalization of deemed interest of $7.4 million in connection with Golar’s equity investment in Golar Power. This has been partly offset by additional interest charges as a result of an increase in LIBOR.

      ·         Other financial items reported 3Q 2017 income of $4.4 million. This non-cash income was derived from a mark-to-market gain on the three million Total Return Swap (“TRS”) shares following a $0.36 quarter-on-quarter increase in the Company’s share price, an increase in swap rates resulting in mark-to-market interest rate swap gains and a $2.5 million mark-to-market gain on the IDR Earn-Out Units derivative.

      ·         The $5.9 million 3Q 2017 equity in net losses of affiliates is primarily comprised of the following:
                    –       a $5.0 million loss in respect of Golar’s 50% share in Golar Power;

                    –       a $2.1 million loss in respect of Golar’s 51% share in OneLNG; and

                    –       income of $1.1 million in respect of Golar’s stake in Golar Partners.

Golar Partners reported a substantial drop in 3Q 2017 net income, primarily due to recognition of the Golar Spirit termination fee in 2Q 2017 and the loss of earnings from this FSRU post June 23, 2017.

Golar’s $8.4 million 3Q 2017 share of net earnings in the Partnership is offset by amortization, principally of the fair value gain on deconsolidation of Golar Partners, currently equivalent to $7.3 million.

At $12.9 million, the quarterly cash distribution received from the Partnership is in line with prior quarters.

Source / More: Golar

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