CoolCo (CLCO) was among the shipping companies reporting Q4 2024 results on 02/27/25. Included in the results
- Rev of $84.6M
- Adj EBITDA of $55.3M
- Net Income of $29.4M
- Dividend - CLCO decided not to pay a dividend
While the company had indicated the div payout was variable, and had already slashed the Q3 2024 dividend by more than 50%, I kind of expected CLCO would still pay a div for Q4 2024. Sure, with no Q4 recovery of LNG shipping market, the situation got uglier in Q4 2024.
I guess, even a token dividend was not in the thinking. However, all is not lost. The company has announced a $40M share buyback spread across 2 years. At current CLCO price (~ $6/sh), CLCO could buy back > 10% of its shares.
The challenges
- Newbuild LNG tanker, Kool Tiger, delivered and had no contract, so the vessel traded spot in Q4 2024, and is still trading spot.
- Kool Glacier also rolled off its charter, and traded spot in Q4, prior to heading to dry-dock for its upgrade.
- The overall market has to deal with something new- tariffs. No idea how much of an impact this will have on the market.
- New US LNG export facilities e.g. Plaquemines LNG, that had been put on hold by prior administration, got the go ahead to export in 2025, and will be allowed to increase its export capacity more than 12% However, the facility owner, Venture Global, does own some LNG tankers. Enough to cover the new facility output? My guess is there will be additional tonnage needed.
- CLCO already has a majority owner. During, or after, the buyback period, why not take the company private? Has already happened a few times in the LNG tanker space - the two Gaslog entities, Teekay Gas Partners, Hoegh