Dorian LPG Ltd. Aktie

Good morning, and welcome to the Dorian LPG Fourth Quarter and Fiscal Year 2026 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. Additionally, a live audio webcast of today's conference call is available on Dorian LPG's website, which is www.dorianlpg.com. I would now like to turn the conference over to Ted Young, Chief Financial Officer. Thank you, Mr. Young. Please go ahead.

Thanks, Madison. Good morning, everyone, and thank you all for joining us for our fourth quarter 2026 results conference call. With me today are John Hadjipateras, Chairman, President and CEO of Dorian LPG Limited; John Lycouris, Head of Energy Transition; and Tim Hansen, Chief Commercial Officer. As a reminder, this conference call webcast and a replay of this call will be available through May 27, 2026.

Many of our remarks today contain forward-looking statements based on current expectations. These statements may often be identified with words such as expect, anticipate, believe or similar indications of future expectations. Although we believe that such forward-looking statements are reasonable, we cannot assure you that any forward-looking statements will prove to be correct. These forward-looking statements are subject to known and unknown risks and uncertainties and other factors as well as general economic conditions.

Should 1 or more of these risks or uncertainties materialize or should underlying assumptions or estimates prove to be incorrect, actual results may vary materially from those we express today. Additionally, let me refer you to our unaudited results for the quarterly and annual periods ended March 31, 2026, that were filed this morning on Form 8-K. In addition, please refer to our previous filings on Forms 10-K and 10-Q, where you'll find risk factors that could cause actual results to differ materially from those forward-looking statements.

Please note that we expect to file our full 10-K no later than May 29, 2026. Finally, I would encourage you to review the investor highlight slides posted this morning on our website. With that, I'll turn over the call to John Hadjipateras.

Thank you, Ted, and thanks for joining us today. My colleagues will share some useful and interesting information about the past quarter and our views of the market. First, I'd like to say a few words on capital allocation and provide some historical context on fleet development, which relates to risk management and a volatile market with a view to capturing upside. Today's price of a new building VLGC had approximately $115 million reflects an increase of approximately 2.5% permenant over the course of our first VLGC and which was delivered to our predecessor company 20 years ago.

She was ordered for a price of approximately $65 million in 2004. Wenche was delivered in 2006, the new building replacement cost was over $90 million. From 2009 to 2012, the newbuilding price hovered in the low $70 million range and the next order we placed was in 2012 for advanced Echo type series at just under EUR 70 million each. The new building prices stayed under $70 million range until 2021.

The total VLGC fleet in 2005 comprised 102 ships. Today, the total fleet is 427 VLGCs, and there are about 124 ships on order, representing nearly 30% of the existing fleet compared to the all-time high of more than 50% in 2007. Our owned fleet comprises 18 echo type with efficiency enhancing features and 2 new dual fuel ships. The average age of our fleet is 10.3 years. In the next few years, we hope to expand our fleet by adding new ships and expect that the catalyst of our -- for our investment in replacement tonnage will be innovation in the design and efficiency of new buildings.

The advent of ultra-long stroke electronic engines informed our investment decision in 2012 and the development of dual fuel engine supported our decisions for our investments in the capital markets delivered in 2023 and via Rio delivered a couple of months ago. We have witnessed the volatility I've described, and we've been the beneficiaries of a tremendous increase in the volume of seaborne trade of LPG in both absolute terms and in ton mile terms.

We have confidence in the further expansion of this trade. And our intention is, as always, with our capital allocation to proceed judiciously mindful of our step-based to maintaining a solid balance sheet. We believe that this is the roof by which we can earn the best returns for our investors and continue to provide top-quality services to our customers and a safe and fair working environment for our people at sea and onshore. And now I'll pass you on to Ted.

Thanks, John. My comments today will focus on capital allocation, our financial position and liquidity and our unaudited fourth quarter results. We've been active since the beginning of calendar 2026 and growing our business and rewarding shareholders. First, we took delivery of the Aireon in late March, our fully ammonia capable of 93,000 CBM VLGC. As you would expect, she immediately started contributing to earnings though we won't see the P&L impact until the first quarter of our fiscal 2027.

The most recent irregular dividend of $1 per share, a significant increase from the prior quarter's reflected the strong underlying market and our Board's commitment to creating shareholder value. Second, we completed the sale of the 2015 build COBRA in May, paying off $16.5 million of debt in the process. We expect to generate a gain on sale of approximately $30 million from her sale. And I would note that our sale price was actually greater than her contract price in 2015.

Finally, we will complete the repurchase of the Corsair for her sale leaseback before month end, which will require a payment of about $24.2 million in total and positions us to be flexible with any potential opportunities. At March 31, 2026, we reported $327.4 million of free cash, which was sequentially up from the previous quarter. Cash flow from operations was $82 million or nearly $2 per share and as we noted in our press release, we borrowed $62.9 million upon closing of the delivery of the Aireon, covering the final payment to the yard.

As we disclosed then, the Arian loan has 2 tranches, 17 years and 112 years over 10 years and a weighted average on margin in to 125 basis points over SOFR. We closed the fiscal year, therefore, with a debt balance of $565.8 million, but given the payoff of the debt in connection with the sale of the Cobra and the Corser repurchase, the pro forma balance would be $524.7 million. Based on our stated book, however, at quarter end of $565 million of debt, our debt to total book cap stood at 33.2% and net debt to total cap of 14%. We continue to have well structured and attractively priced debt capital with a current all-in cost of about $5 million, an undrawn revolver of $42.9 million and 1 debt-free vessel.

Coupled with our strong free cash balance, we have a comfortable measure of financial flexibility. We expect our cash cost per day for the coming year to be approximately $26,000 per day, excluding capital expenditures for the dry docking of the Kapan John which is currently planned for our fourth fiscal quarter. For the discussion of our fourth quarter results, you may find it useful to refer to the investor highlight slides posted this morning on our website. I remind you that my remarks will include a number of terms such as TCE available days and adjusted EBITDA. Please refer to our filings for the definitions of these terms.

Looking at our fourth quarter chartering results, since our entire spot trading program is conducted through the Helios Pool, its reported spot results are the best measure of our spot chartering performance. For the March 31 quarter, the Helios Pool earned a TCE per day for its spot and COA voyages of 65,600 per day, reflecting more favorable VLGC market conditions. Our utilization improved sequentially to 78% this quarter from 94.6% in the prior quarter as the last of our drydockings for the 2014 to 2016 class was completed. The overall TCE result for the pool of nearly 63,300 per day reflects that very strong rate environment as well as our time charter portfolio.

On Page 4 of our investor highlights material, you can see that we have 6 story and vessels on time charter within the pool, indicating spot exposure of just over 80% of the 31 vessels in the Helios Pool. Dorian's reported TCE revenue per available day for the quarter was about $63,615, which is the second highest TCE rate we have earned in our corporate existence. For the year, we earned 52,238 per day, with the fourth quarter completely offsetting our sector's relatively slow start to the fiscal year.

The current rate environment remains healthy. So Panama Canal transit fees are having an impact on realized rates. We'd note that most posted rates -- TCE rates do not include auction fees for VLGCs transiting the canal, which have ranged from $200,000 to as high as $4 million in the last weeks. And also, they do not include the effect of ballasting around the Cape of Good Hope, which can also have a significant impact on realized TCEs. We plan to issue our forward booking information in the near future.

Daily OpEx for the quarter was $9,548 excluding drydocking related expenses, which was virtually flat with the prior quarter's $9,558. Our gross time charter in expense for the 6 TCN vessels came in at $18.4 million or about $34,100 per TCN day, thus, those vessels contributed positively to our quarterly profits. As a reminder, the profit-sharing expense on our P&L represents MOL Energia's portion of the net chartering profit as the charter hire earned less the charter higher expense on the BW Tokyo.

Total G&A for the quarter was $13.3 million in cash G&A, which is G&A excluding noncash compensation expense, was about $11 million. This amount included accruals under our bonus plan of $3.5 million, the payment of which is subject to completion of our annual audit, $200,000 of statutory noncash accruals and about $300,000 of free delivery costs related to the area. Excluding those amounts, our G&A was about $7.1 million, which reflects a level that we believe is sustainable for the near term.

Our reported adjusted EBITDA for the quarter was $106.6 million. Total cash interest expense for the quarter was $6.6 million, which is down sequentially from the prior quarter. Principal amortization remained steady at around $13 million. We expect the full quarter interest cost of the Aireon to be approximately $800,000 in the coming quarter. The regular dividend declared at the beginning of the month of $1 per share is our 19th and brings to $1.65 per share in a regular dividend that we have paid since September 21.

The increase in the dividend versus the prior quarter is consistent with our previous discussions around the topic reflects a balanced mix between results and the long-term needs and prospects of the business. Including the irregular dividend to be paid this month, we have paid nearly $770 million of dividends have generated net income of $835 million since June 30, 2021, which is the quarter immediately prior to our first regular dividend.

As we've discussed, our Board waste current earnings, our near-term cash forecast, future investment needs in the overall market environment among a number of factors in making its determination of the appropriate level, if any, for our dividend. As John Hadjipateras has already mentioned, our sector can be a volatile one, and our dividend policy needs to reflect that. The $1 per share irregular dividend certainly reflects a constructive market outlook while also allowing the company the flexibility for future fleet reinvestment.

We continue to be on the lookout for fleet renewal opportunities and we'll be judicious with our free cash flow, working to balance shareholder distributions, debt reduction and fleet investment. With that, I'll pass it over to Tim Hansen.

Yes. Thank you, Seth, and good day, everyone. The quarter ended March 31, 2026 ultimately carried the positive momentum from the quarter prior and saw higher freight in digital for the VLGC freight markets. I closed my remarks from the quarter prior about likely cupolitical impacts and the GC market's ability to derail to capture the opportunities that arise from such challenges.

We believe both have materialized and that the company has been a key actor in that story. The quarter ending March 31, 2026, especial on the topline periods before facilities in Iran started and the period after facilities commenced and to look at them separately. While global seaborne LPG transport was down for the quarter to levels not seen since the first calendar quarter in 2024, the decline was driven by the de facto closure of the Strait of Hormuz of homes decline last the result of record high production levels from the North America, which hit a new record high of exports near the 20 million tonne mark.

The favorable fundamentals of LPG production and accompanying seaboard transport prior to the closure of Strait of Hormuz further supported our first calendar quarter, seeing a wise West-East arbitrage and persistently high freight activity levels. This does not mean that freight markets only saw smooth sailing, however. Price on the closure of the state foremost industry players was analyzing potential impacts from the removal of President Martin idea my very kind of concerns brought on by the regrithreatening the end of the nature and the U.S. Supreme court striking down refer tariffs.

It is not uncommon to see softness in the first calendar quarter in the freight markets with lower activity when the imports reduced imports spring approaches or due to a slowdown in the Far East around the Lunar New Year holidays. This was not the case in 2026. Activity was strong through the holiday season to compensate for the disruptions we saw in October, November during the port service feedback between the U.S. and China. Furthermore, the winter in the Far East was longer in cold, while coal snaps in the North America was not severe enough to weaken production levels.

The rest are charge was there for flying and the TC freight was supported by the fundamentals. There were significant challenges to capture the value in the market, however, and periods of uncertainty because of developments in Media protesting in Iran and varies about nature creation. While none of these factors imply directly impacted the VPG market, the macroeconomic picture was certainly complicated. If 1 described to the argument that more internationally tradable Venessa Deno was positive for the world economy -- economy-heav if the Chinese economy will suffer by losing net monopoly access to low-priced intraband crude oil.

If 1 believes that the process in Iran will table the static republic and lead to softening sanctions, the likelihood of significant and dramatic scrapping of the shadow fee will open models of vessel supply. Right through the Supreme Court decision to strike down our per tariffs these geopolitical events, even if not directly impacting the VLGC freight market for long periods, ensure that the market plays remained active at the best to consider the upsides and the risks the period before the session mini was marked by positive have to see fundamentals with value captured by an attentive and active market.

Once Iran was formed and thereafter retaliated against the Gulf neighboring countries, a new uncomplicated dynamic emerge for the VLGC market. The effect of the regional conflict are felt worldwide and through all parts of the economy. I'll focus on the new few key aspects that directly impacted the VLGC markets over the relevant quarter and through April.

Regarding freight levels, they have been mostly higher after the closure of the trade of almost, although it was a consistent increase panel windows of belief that the Strait of Hormuz will open more vessels will hold back from balancing to the west and oversupply the Western market. And during other periods, there was 0 belief in the straight opening and more vessels supply was available in the best high freight has not been disrupted to the average as that widened dramatically on the back of importing nation facing shortages.

The Far East index was bid up and import demand kept the upward open. The fear of shortages back to the bunker market and the key bunk approach. Currently, prices have normalized and concerns of stock to supply less immediate. For to March, some boards saw doubling of course, some countries and the bunkering services to prevent also preserve energy stocks. And even to this day from when storage tank will be portal hidden we give, the physical export capacity in question.

The higher freight markets on the back of the white open West supercharge was further supported to cover the high band of expenses for shipowners. 2 additional external factors resulting from the Iran conflict at further freight levels. Trade lanes have had to recalibrate and this show success resulting in Domain miles. The VLCC market already demonstrated a plenty to readjust quickly after the roses legal war on Ukraine and through periods of tariff wars and have delivered again now with minimal ability to supply, for example, India from the Middle East there's been a greater flow of cargoes from the U.S. to China.

The length of voyages and port turnaround uncertainty have tightened the market. The Panama Canal has contributed to absorbing vessels of power resulting in significantly higher Panama costs with the increase in auction fees. This is mostly due to all goods and commodities, including LPG seeing high deliver price in the Far East segment that previously saw less urgency to get to ratio quickly through the Panama Canal, return to use the Canal and congestion has been on a steady increase since the bottoming of comments.

The impact of an increasingly congested Panama Canal persists to this current calendar call as well, continuing to keep the ability -- availability of vessels tight and the freight market is high. With that, I will pass it over to Mr. John Lycouris.

Thank you, Tim. At Dorian LPG, we remain committed to continually enhancing energy efficiency and promoting the sustainability of both our operations and of our vessels. We currently operate 16 scrubber-fitted vessels and 6 dual fuel LPG vessels after taking delivery of the VLGC lac area. Higher oil prices in March due to the Middle East conflict and the subsequent blockage of the stator moves led to higher bunker price differentials, which are the score the important subscribers and our fuel efficiencies efforts. .

Rubbers neutralized sulfur oxides from fuel oil, while significantly reducing particulate matter in ply carbon emissions when compared with conventional VLSFO, very low sulfur fuel oils. For the fourth fiscal quarter of 2026, our scrubber vessel savings amounted to about $3,482 per day per vessel, net overall scrubber operating expenses. Fuel differentials between high sulfur fuel oil and very low sulfur fuel oil averaged $89 per metric ton, while that of LPG as fuel versus very low sulfur fuel oil stood at about $205 per metric ton, making LPG economically attractive for our dual fuel vessels.

We have now completed the statutory special survey and docking cycles of our 2014, 2016 class of vessels with the last vessel completing her special survey during this past quarter. As previously announced, Dorian LPG took delivery in March, the 93,000 cubic meter dual-fuel newbuilding Areon from Hanwecean. The range fuel ship, which can operate on LPG and fuel oil and fit to carry 4 cargoes of LPG and/or ammonia. When operating on LPG, CO2 emissions are approximately 20% lower while sulfur oxides particular matter and other pollutants are significantly reduced.

With this second wholly owned dual fuel LPG vessel, 20% of our fleet now runs on low-emission alternative euros. Area is also fitted with a hybrid scrubber capable of closed-loop operation for restricted ports and for the emission control areas. Our March press release provides additional details on the ships operating capabilities and our advanced technologies. MEPC 84 concluded the discussions of the IMO NetZero framework without resolving the Net Zero framework final form and/or its adoption time table.

Alternative proposals emerged during the meeting to amend the proposed framework, but the lack of sufficient support for any single alternative has stalled progress on the Nets framework. The IMO affirmed its preference for a global regulatory approach rather than a fragmented regional -- the fragmented regional measures. If the net 0 framework is adopted at MPC 85 in December 2026, it would then do into for 2028, and its first reporting year is likely to be in 2029.

However, several key issues remain under negotiation, including the GFI targets, compliance mechanisms, the role of the IMO Zero fund, fewer certification rules and how that framework will align with existing CII and Cemp regulations. Another outcome from the MEPC 84 included the adoption of the Northeast Atlantic ECA, which will introduce stricter sulfoxide, particulate matter and NOx requirements from 2027 onwards. We are confident that the Dorian LPG fleet will be prepared to meet regulatory changes in the future. And now I would like to pass it over to John Hadjipateras for his final comments.

Thank you, John. And Madison, if you have -- if we have any questions, we're ready to take them. .

[Operator Instructions] And we will take our first question from Omar Nokta with Clarkson Securities.

John, Tim and John, thanks for the update. It sounds like, clearly, a lot of stuff is happening. You've had a nice quarter and the next 1 looks like it's going to be off the charts. So I just have a couple of questions. Maybe just first, it looks like you've taken advantage of a pretty good market here to put some ships away on term charter as you highlighted. I think it's been a while since we've seen you add perhaps this much in duration.

So I just wanted to get a sense, what's your appetite to do more of that I guess, perhaps maybe for both you and the charter, what the desire look like to add more TC coverage? And then are you willing to disclose any of the terms in terms of day rate?

Thank you, Omar. Well, we've disclosed as much as I think we're entitled to disclose under the contracts that we have. As regard our future appetite, it really is rate dependent. There's always this element in a very high spot market where you're giving up the immediate earnings to get the length at the back end. And or -- I think we have a balanced view. I mean we're not scared with the spot market, but we -- if the rates are right for cover, we're happy to take more cover as well. I know this isn't very precise, but it's kind of a general idea of where we're at in terms of our approach to the chartering on term. .

Okay. I appreciate it, John. That's helpful. And I guess maybe, I think, Ted, you were discussing sort of the spot market at the moment in terms of, say, rates and how they're not perhaps indicative of true earnings when you take into account some of the costs at the Panama Canal, whether it's the auction fee or maybe the wait time or the diversion. Do you care to maybe give a sense of, hey, headline rates today say they're at $170,000 per day. What would you say is like the true real earnings that are being captured? Any sense you're willing to or able to share?

Yes. I think Tim can answer that question. Yes, Tim, do you want to take a shot?

Yes, it's fluctuating quite a lot. I mean if you you see the auction fees, for example, on the Panama run went up to EUR 4 million. So if you divide that over 60 some day onwards you were kind of like reducing your TCEs with 60,000 plus a day, right? But not all hit that. So it's varying quite a lot also be balanced around the Cape, you have a longer it, so you have to spread out the savings launch on freight on more days, which will drop the result even without pricing the -- or anything by by maybe a $10,000 a day and large even you get shots on the Panama, you most likely wait a few days because you don't want to jeopardizes running later your slots because you will never get into the first idle time.

So it's depending on what trades you would take, but what you will see as time value is high. the 10, 20 -- 30,000 below the highlight rate.

All right. So it still has the 100-plus number. .

And course, yes. Yes. .

And then maybe just a last 1 for me, maybe just kind of on the point of the U.S. export market because there's been a lot of discussion on Panama Canal and the diversions. I guess just generally, just given what's going on in the market here over the past 3 months, almost 3 months. Has the VLGC trade, and I guess, your business specifically, has it just completely shifted now to a pure U.S. exposure? Or are there other areas where you're active where there's cargoes to be taken.

For us, as Heloise part from the time where we saw neighbor ships heading towards the Gulf, we decided to stay away. So we always feel like very focused on the U.S., so up to 80% of our business are liftings. And if you count the base with the longer varies, maybe 90% of our coverage has been focused on o U.S. But today, it's basically so U.S. and Canada, U.S. on the West Coast, where we do not touch -- we do fix the occasional West African voyage, of course. And if someone wants to pay for the shows would look at that, but, yes. I would say, U.S. kind of. .

And we'll move next to Stephanie Moore with Jefferies.

Hi, good morning. Thank you for the question. Maybe just a follow-up to the last kind of string of questions here. A great really strong quarter. It looks like the next quarter is going to be quite robust. -- given the underlying environment. So with that as the backdrop here and what remains really strong cash generation, and obviously, a really constructive outlook. Could you just maybe talk to us about how you are prioritizing capital allocation across the dividends, deleveraging, fleet expansion, especially in this environment, an update there would be helpful. .

Thank you, Stephanie and welcome to covering our sector. Yes, I'm going to hand over to Ted to give you an answer on that. .

Yes. Stephanie, I think look, it's a bit of a dynamic balancing act. As you know, our debt amortizes pretty steadily and most of it is very attractively priced. So we haven't seen a need to proactively manage prepaid debt, the dividend is obviously an important part of the story for investors. And we continue to make that center piece in, but it's on in. We have real order in the pie always have been.

So it's a little different than some other sectors, say, midstream where it's a little bit easier to quantify how you're going to break things out. And I think from our perspective, it's a bit fact and circumstance dependent. But we are looking for those opportunities for fleet reinvestment as our fleet gets up in age. It's still a great fleet age. It still has great technology. But I think if we saw a great opportunity to acquire a meaningful fleet, we would do it.

And if that came -- if we felt that we had to have some impact on the dividend, we'd have to look at that. On the other hand, -- it's a really big part of the total shareholder return story. And we care about it as shareowners. It's a big part of our incentive share program here. So there's a lot of driving forces to maintain a reponderance of focus on the dividend as we go ahead.

I appreciate that. That's very helpful. And then maybe just a high-level question, as you think about -- I would love to get your thoughts on just your outlook for LDL PG sector for 2026, especially maybe if you touch on, we do see fire a bit of normalization in the Middle East, how you're kind of viewing the impact on the overall sector would be helpful. That's it.

Actually, Tim, do you want to take a shot at that?

Sorry, what you want reserve .

So Stephanie asked about what our views were on the post Middle East stabilization view of the LPG trade, which I'm passing me because it's a really hard question.

I mean it's really depending on when it will happen because even though we are publishing now from the longer haul in the U.S. has managed to produce much more for exports. The LPG is still in short supply in the world, and we are seeing if it lasts for longer, it will result in demand destruction. We also don't know exactly the held badly hurt the Middle East is on their ability to export once it comes back open.

So do we expect at the moment, whether by the opens, we will probably see more vessels available with the ships captured in the Middle East available in the market, and it will be a little bit of time before the export ramps up again. So you could see a bit of an oversupply shift at that point. But it's really depending on where the system position at the time and how people perceive the ability of the Middle East and exporters to ramp up again and whether they would both shifts back to the Middle East or not, but ...

Thanks, Stephanie, as a general remark, I'll just tell you that our what we try to do all the time is planned for the worst and hope for the best. And I think the worst outcomes are so varied that it's impossible really to have cap the mall, but we try. -- and we're hoping for the best. And at the moment, we're enjoying a good run. And I think that kind of encapsulates what we'd like to say on the subject right now. .

Yes. No, I appreciate it. You didn't mean to give you such a nuanced question there, but the insight is very helpful. And thank you for the time. .

Thanks, Stephanie. Thank you saving.

[Operator Instructions] And we'll move next to Clement Mullens with value investors edge.

Tim, you talked about the Panama Canal and the impact that increased transit has had on auction pricing. Does this apply to both the old and the new locks or especially on the latter? And secondly, can you comment on the percentage of VLGC's transit that heading towards the Far East have decided to avoid the canal?

Good. Tim, can you add to that one, please? .

Yes. So the auction fees at the moment is the impact is on the new canal. There has been some increases on the old Cana as well or the old drugs, but not to any comparable effect. So it's mainly the new canal, you could see some auction fees on the old can come in or as there's probably some repairs and maintenance in June. So that can change.

But at the moment, the increases we have seen is on the auction fees on the new canal. With regards to routing, we see more and more people routing cap and be the same as we have experienced the high canal cost, but it's a moving situation. It went so that elastomer million trying to later. So -- so that time it would already be on the ballast leg towards the Panama. So your target side and evaluating the risk or taking the changes over there.

Okay. very helpful. year-on-year. I mean for the year -- has line authority build more flexibility to tackle this, should we see a repeat of the El Nino and little rain in the region? Or should that happen, do you believe that we would see, let's say, a repeat of what we saw a couple of years ago?

I think they learned a lot the case in by being able to retain more and that does have less flocks of the border, but they cannot prevent it. So we will see a result of this if the which is likely to -- or 7% or whatever it is likelihood at the moment. would happen over a longer period. We will see reduced draft in the Panama, but not -- maybe not to the extent as through.

Thank you very much. Madison, I think we can close. And thank you, everyone, for your interest, and see you next quarter.

Thank you. This concludes today's meeting. We appreciate your time and participation. You may now disconnect.

Good morning, and welcome to the Dorian LPG Third Quarter 2026 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. Additionally, a live audio webcast of today's conference call is available on Dorian LPG's website, which is www.dorianlpg.com.

I would now like to turn the conference over to Ted Young, Chief Financial Officer. Thank you, Mr. Young. Please go ahead.

Thank you, Raisa. Good morning, everyone, and thank you all for joining us for our third quarter 2026 results conference call. With me today are John Hadjipateras, Chairman, President and CEO of Dorian LPG Limited; John Lycouris, Head of Energy Transition; and Tim Hansen, Commercial Officer -- Chief Commercial Officer. As a reminder, this conference call webcast and a replay of this call will be available through February 12, 2026.

Many of our remarks today contain forward-looking statements based on current expectations. These statements may often be identified with words such as expect, anticipate, believe or similar indications of future expectations. Although we believe that such forward-looking statements are reasonable, we cannot assure you that any forward-looking statements will prove to be correct. These forward-looking statements are subject to known and unknown risks and uncertainties and other factors as well as general economic conditions. Should one or more of these risks or uncertainties materialize or should underlying assumptions or estimates prove to be incorrect, actual results may vary materially from those we express today.

Additionally, let me refer you to our unaudited results for the period ended December 31, 2025, that were filed this morning on Form 10-Q. In addition, please refer to our previous filings on Form 10-K, where you'll find risk factors that could cause actual results to differ materially from those forward-looking statements. Finally, I would encourage you to refer to the investor highlight slides posted this morning on our website during our remarks.

With that, I'll turn over the call to John Hadjipateras.

Thanks, Ted. Good morning, and thank you for joining us. Before my colleagues provide you with detailed comments on our financial results, our market outlook and our operational progress, I'd like to highlight the following: our dividend declared last week of $0.70 per share totaling $29.9 million will be our 18th dividend payment, bringing total dividends distributed to over $725 million and total capital of $961 million returned to shareholders since our IPO.

The VLGC market remained strong in the fourth calendar quarter with spot earnings well above long-term mid-cycle despite some volatility. Indeed, as we speak, demand and freight rates continue to be strong. Last quarter, global liftings were up 3% year-over-year, measuring 36.8 million tons. The new record level of LPG exports highlights the attractiveness of LPG as an energy source for domestic, commercial and industrial uses. Tim will elaborate on the VLGC market and our outlook.

On the operational side, we completed 12 dry dockings this past year and have one more scheduled for this month, which will bring to completion the docking cycle for our fleet. After this last docking cycle, most of our ships will have been fitted with energy-saving devices and silicone paint, resulting in meaningful cost savings and emission reductions. We have a 93,000-cubic meter VLAC new-building delivering in March from Hanwha in South Korea. John L. will give you more information on the progress made in our docking program, ammonia retrofits and new-building delivery as well as the regulatory environment.

Ted will now present our quarterly financial overview. Ted?

Thanks, John. My comments today will focus on our unaudited third quarter results, capital allocation and our financial position and liquidity. For the discussion of our third quarter results, you may also find it useful to refer to the investor highlight slides posted this morning on our website. I'd also remind you that my remarks will include a number of terms such as TCE, available days and adjusted EBITDA. Please refer to our filings for the definitions of these terms.

Turning to our third quarter chartering results. We achieved a TCE per available day of $50,333. Chartering results were strongest in October, followed by a small dip in November and into the first part of December. Tim will elaborate more on the current rate environment, which has substantially improved.

As our entire spot trading program is conducted through the Helios Pool, its spot results are the best measure of our spot chartering performance. For the December 31 quarter, the Helios Pool earned a TCE of $50,500 per day for its spot and COA voyages. On Page 4 of our investor highlights material, you can see that we have three vessels on time charter within the pool, indicating spot exposure of about 90% for the 29 vessels in the Helios Pool. We will provide forward booking information later in the quarter in order to make it more useful for the investment community as the impact of rate volatility is best managed by providing information when more of the quarter is booked.

Daily OpEx for the quarter was $9,558, excluding dry docking-related expenses, which was more or less flat with the prior quarter. We are encouraged by the lower OpEx, excluding dry docking over the last 2 quarters.

Our time chartered-in expense for the TCN vessels came in at $18.2 million, consistent with our guidance and equivalent to an average charter hire of about $33,000 per day, reflecting full quarter contributions from both the Crystal Asteria and the BW Tokyo. The Tokyo is jointly chartered in with MOL Energia and deployed into the Helios Pool, and thus, we account for 100% of the revenues and time charter expense on our P&L. The new line item, profit sharing expense on our income statement reflects the 50% of the net chartering result that is due to our partner. For the March quarter, we estimate TCI expense continue to be in the $18 million to $19 million range again for the quarter.

Total G&A for the quarter was $10.8 million and cash G&A, that's G&A excluding noncash comp expense, was about $8.7 million. Included in that $8.7 million was about $2 million of quarterly expense under our cash incentive plan. Thus, our core G&A remained steady at roughly $6.7 million.

Our reported adjusted EBITDA for the quarter was $74.2 million. Total cash interest expense for the quarter was $6.8 million. Our current debt cost is about 5%, which reflects the heavily hedged and fixed nature of our various pieces of debt.

We closed the quarter on December 31, 2025, with $294.5 million of free cash, which was up about $25 million from the prior quarter, which is a particularly good result as we paid the dividend and an installment on our new-building during the quarter.

As announced last week, we will pay $0.70 per share as an irregular dividend or roughly $30 million in total on or about February 24, '26 to shareholders of record as of February 9, 2026. With a debt balance at quarter end of $516 million, our debt-to-total book capitalization stood at 32.2% and net debt-to-total cap at 13.8%.

With an undrawn $50 million revolver and a $100 million accordion feature in our existing loan agreement, our strong free cash balance and one debt-free vessel, we feel well capitalized for fleet growth and renewal or for whatever challenges might arise. We expect our cash cost per day for the coming year to be approximately $27,000 per day, excluding capital expenditures for dry docking and scrubbers.

During the quarter, we completed three dry dockings and anticipate one dry docking for this quarter currently ending March 31. That will complete the dry-docking program for our 2014 to 2016-built vessels.

As John mentioned, we expect to take delivery of our new-building ammonia-capable VLGC at the end of March 2026, and we expect to pay about $62 million in cash at closing. We expect to enter into a loan facility to finance that payment.

The irregular dividend declared last week of $0.70 per share brings to $17.65 per share in irregular dividends that we have paid since September 2021. While many investors and analysts like to suggest that these dividends are no longer irregular, we underscore that they are indeed irregular and subject to the discretion of our Board. VLGC's rates are not regular, and thus, we don't think our dividend policy should be either.

Looking at our dividends in a more traditional context, our net income since June 30, 2021, that's the quarter immediately prior to our first irregular dividend, has been approximately $754 million, while including the dividend to be paid this -- later this month, we will have returned approximately $725 million of dividends in total -- sorry, $725 million in dividends. In total, we have returned over $960 million in cash to our investors since our IPO. We will continue to maintain a steady balance between dividends, deleveraging and fleet investment.

With that, I'll pass it over to Tim Hansen.

Thank you, Ted, and good day, everyone. For the quarter ending December 31, 2025, the global seaborne LPG trade increased again to a new quarterly record. It was reported to be more than 37 million tons for the first time. North American export contributed significantly, hitting a new quarterly export record of more than 18.5 million tons. The Middle East exports were the second-highest quarter -- quarterly export volume on record.

The expanded seaborne trade witnessed over the quarter speaks to the attractiveness of LPG as a commodity, but the whole freight markets were challenged by external factors. The key external factors impacting the freight markets were lower-than-anticipated Saudi contract prices or Saudi CP for October and the retaliatory port service fees implemented in China.

Starting with the lower-than-anticipated Saudi contract prices, it should be remembered that the Saudi CP influences the pricing of the Far East Index, or FEI, and therefore, impacts product price economics. The Saudi CP for October was lowered to be price competitive against U.S. exports for a tender into India and to demonstrate some commercial flexibility on the parts of Saudi Aramco.

The price decrease was unexpected because the Saudi CP is historically in a contango throughout the fourth calendar quarter of any year and Far East imports increase in anticipation of winter heating demand. The drop in the Saudi CP and Far East Index created an uncertain trading environment for a few weeks and narrowed the arbitrage, slowing and weakening the freight markets.

Amidst the slower freight market activity, the port service fees were announced in China to impact the U.S.-related vessels on the 10th of October. The timing was key as the announcement felt on a Friday before 3-day weekend with the implementation happening on the 14th of October to match the USTR Section 301 port service fees.

The immediate impact was for vessels with cargo on board and en route to China, setting in motions the discussions and rerouting of some vessels as additional costs would be incurred and there were ambiguities as to the scope of the impacted vessels. The shock of sudden cost negativity impacted the market and had a knock-on effect on the wider Far East cargo market by -- prompting owners with vessels scheduled to load in the Arabian Gulf and U.S. target cargoes not bound for China and price those aggressively.

Normalcy returned to the market at the end of October when the U.S.-China Summit in Busan found an agreement to suspend the port service fees for both countries until the 9th of November 2026 and the market corrected upwards again.

The third calendar quarter demonstrated VLGC players to respond with agility when the USTR Section 301 port services was announced, and the fourth calendar quarter reaffirmed this. Once the backlog of unfixed vessels was cleared through November, the freight market improved through December to capture value from the West to East arbitrage that returns to normal levels. The quarter ending December 31, 2025, ultimately traded amid a lower average Baltic Index than the quarter prior, but found upwards momentum heading into 2026.

For 2026, a total of roughly 36 VLGCs, including one of our own, will require absorption in the market. Geopolitical impact on world market seems -- in world market seems likely, but the agility of the VLGC market and the fundamental attractiveness of LPG as a commodity support the belief that the risk can be mitigated and upside successfully captured.

With that, I will pass it over to Mr. John Lycouris.

Thank you, Tim. At Dorian LPG, we are committed to continually enhancing energy efficiency and promoting the sustainability of both our operations and our vessels. We operate 16 scrubber-fitted vessels and 5 dual-fuel LPG vessels. Scrubbers neutralize sulfur oxides from fuel oil while reducing significantly particulate matter and black carbon emissions.

For the third fiscal quarter of 2026, vessel savings amounted to $1,116,000 or about $933 per calendar day, net of all scrubber operating expenses. Lower oil prices and a lack of geopolitical events led to lower bunker prices, which resulted in our lower savings for the scrubbers.

Fuel differentials between high-sulfur fuel oil and very-low-sulfur fuel oil averaged $57 per metric ton, while the differential of LPG as fuel versus very-low-sulfur fuel oil stood at about $104 per metric ton, making LPG economically attractive for our dual-fuel vessels.

During the last quarter, three vessels completed special survey and dry docking, including one upgraded for the carriage of ammonia cargoes. With the completion of the special survey and dry dock of the last of our C-type vessels this month, we will have completed the entire dry docking cycle for our 2014 built -- 2016 built vessels.

Next month, we take delivery of the Hanwha Ocean 93,000-cubic meter new-building, which is a VLGC and VLAC combined, and which will join the Dorian LPG fleet. This LPG dual-fuel vessel is fitted with a hybrid scrubber and with Alternative Marine Power.

Annual efficiency ratio, or AER, is the metric which calculates the carbon intensity of our vessels' operations. The average Dorian LPG fleet AER for the full year 2025 was 6.24%, which is 10.4% better than the IMO required target for 2025 of 6.96%.

In late 2025, the IMO's Marine Environmental Protection Committee met for a second extraordinary session. Member states decided to delay approving changes to the MARPOL Annex VI by 1 year. Despite this delay, Dorian remains fully committed to investing in fuel efficiency, improved performances and decreased greenhouse gas emissions.

We view the delayed IMO changes as a very positive step, allowing more time for input and review on many outstanding technical issues, capabilities, procedures and implementation details. This also gives our industry time to prepare and adjust expectations for realistic targets for the net zero framework guidelines and towards gradual development of alternative fuel.

The MEPC 84 session is scheduled to take place in the spring of 2026. We expect this session to focus on finalizing critical implementation guidelines that will give more clarity on the net zero framework and to consider additional proposals. We are confident that our company and fleet are well equipped and fully prepared to meet regulatory changes ahead.

And now I would like to pass it over to John Hadjipateras for his final comments.

Thanks, John. And we'd love to open up for questions if anyone has joined us and like to -- who has joined us, would like to ask any questions. Operator, please.

[Operator Instructions] We'll take our first question from Omar Nokta with Clarksons Securities.

I do have a couple of questions, maybe one on the market, and I just wanted to get into Dorian specifically. But maybe broadly on the market. I know, Ted, you mentioned you'll wait a bit to give us guidance on how the quarter's bookings are looking. But just in general, what we've seen here in the spot market, rates seem to be quite strong. They're at 2-plus year highs. And it's interesting in terms of how this is happening and somewhat defying the typical seasonal norms.

And so I just wanted to ask from your perspective, what's been driving this kind of counter-seasonal strength? And then from that sense, what do you think that then means for how the year is going to look in general?

Thanks for that question. Is this Omar? I didn't catch the introduction.

Yes, it's Omar.

Omar, congratulations on your new position. I'm happy to have you back in the industry. Tim, can you take that question, please?

Yes. Omar, it's unusual that the first quarter actually goes stronger as we get into the quarter. But as I mentioned, the last quarter of 2025, there was a lot of uncertainties and people held back on the activity. So there was a little bit less cargoes lifted. There was some fog as well in the U.S. and so on. And once all these -- the USTR was cleared, once the fog have lifted and people have gotten used to the Saudi pricing, the market came back.

So I think it was a spur from that kind of lack of activity in November that has gone into first quarter also. And then the production levels have kept on increasing and surprising to the upside. So we have seen more cargoes and the U.S. terminals have been able also to get these cargoes out of the terminals and on to the water. So we see that production continuing on the upside and hopefully continue to surprise on the upside compared to the levels [ advised ] from the U.S. But -- so we do see the rest of the year should be strong and continue in this kind of activity. So we're pretty positive for 2026.

Okay. And then just maybe a follow-up just in terms of how you've been deploying the fleet. You've obviously got a good amount of spot exposure via the pool. I did notice that one of the ships, I think the Chaparral maybe has been put on a TCE into 2027. Anything you're able to share on what that rate looks like? I know you tend to not give specifics, but anything you can give or perhaps maybe in relation to what that would be earning relative to the other ships on charter?

I'll let Tim again answer because I think probably, we have a P&C clause. But Tim and Ted can also give -- tell you what we can tell you, put it that way. Tim, do you want to start and then Ted can take over.

Yes. As you mentioned, we don't give out the rates. It is reported in the market. It was a deal that was done back in October, November and just going on charter this quarter for a little more than a year's charter. So on -- we do our [ charter ] like more opportunistic when we see possibilities. Of course, the market has since then surprised us on the upside in the spot market, but we think it's at levels compared to the earnings we do in the spot market over the last quarter.

But Ted, maybe this is a good time to say something about guidance.

Well, yes, I think picking up on the topic of guidance, like we said, Omar, we think it's probably more useful to give the overall forward bookings information later in the quarter just because there's so much volatility in the business in the sector, just as Tim alluded to. And so the information coming out later is going to be better.

And so I think that -- so we'll leave it there. But I think Tim did a good job of giving you the overview. I also think it's probably -- was reported, which I think is interesting, it's business for Brazil, which I think is pretty exciting because of what it says about Brazil as a potential growth market.

Got it. That's quite helpful. And then just a final one, maybe for you, Ted, just on the new-building that you're taking delivery of here in the next few weeks. It looks like I think from the filing, there's $62 million left to spend. You have $294 million of cash, so quite a bit of flexibility to do what you want. But do you have any specifics on how you plan to fund that vessel? Will you borrow or just pay cash?

Yes. I alluded to it briefly in our remarks. We do plan to finance the rest of the payment, and more detail will be forthcoming when we get there.

Our next question comes from Climent Molins with Value Investor's Edge.

Just kind of a follow-up on Omar's first question. Despite rates being very solid, so far, we haven't seen a significant increase in the average speed of the overall VLGC fleet. To what extent do you believe the fleet can speed up if rates remain solid? Older vessels are, let's say, capped by the environmental regulations. But to what extent could the ECO portion of the fleet speed up?

That's another one for Tim. A very good question.

Yes, there's a bit of leeway in speeding up still. But most of the, you can say, non-LPG fuel ships, so the ECO type from -- you have the majority of the 2015, they are still capped by the environmental regulations and the reductions of power done years back. So there's maybe like 1 Knot or 2 more in it, 1.5 Knots. And for the older ship, there's really nothing.

So it's not a significant additional speed that we can do. You'll probably see when we come into the summer months, if the market is strong, we can go a bit faster. But at the moment, also, we have seen quite a lot of bad weather here over the winter. So even in there, we could go faster. It's hard to actually do it.

That's helpful. And as a follow-up, in your prepared remarks, you talked about the energy saving devices you've installed on your vessels, resulting in meaningful savings. Could you talk a bit further on what kind of improvements that has resulted relative to previous consumption levels? And what kind of IRR are these investments generating? I know like giving an exact figure may not be easy, but any color would be helpful.

Yes. John will answer that. I think we've mentioned something specific, and he could give you as an illustration, perhaps, the payback on scrubbers. That should give you a bit of a color on the whole picture. John?

Yes. The energy-saving devices that we use and we mentioned, usually provide an improvement of around 5%. And that's the ballpark figure for most of the energy-saving devices in most of the ships. And silicone paints also provide a similar kind of number, about 5% improvement in the energy savings. So the payback is generally pretty fast. It is generally within a year. So I think that answers your question.

It does.

That, of course, does not apply to scrubbers specifically. The payback on scrubbers is a bit longer than that. But most of the other devices are low cost, those producing the 5%, low cost. So that's why we have a quick payback.

It appears we have no further questions at this time. I'll turn the program back to the speakers for any additional or closing remarks.

Thank you all for joining us, and have a good summer.

This concludes today's program. Thank you for your participation, and you may disconnect at any time.

Good morning, and welcome to the Dorian LPG Second Quarter 2026 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. Additionally, a live audio webcast of today's conference call is available on Dorian LPG's website, which is www.dorianlpg.com.

I would now like to turn the conference over to Ted Young, Chief Financial Officer. Thank you. Mr. Young, please go ahead.

Thank you, Chelsea. Good morning, everyone, and thank you all for joining us for our second quarter 2026 results conference call. With me today are John Hadjipateras, Chairman, President and CEO of Dorian LPG Limited; John Lycouris, Head of Energy Transition; and Tim Hansen, Chief Commercial Officer. As a reminder, this conference call webcast and a replay of this call will be available through November 13, 2025.

Many of our remarks today contain forward-looking statements based on current expectations. These statements may often be identified with words such as expect, anticipate, believe or similar indications of future expectations.

Although we believe that such forward-looking statements are reasonable, we cannot assure you that any forward-looking statements will prove to be correct. These forward-looking statements are subject to known and unknown risks and uncertainties and other factors as well as general economic conditions.

Should one or more of these risks or uncertainties materialize or should underlying assumptions or estimates prove to be incorrect, actual results may vary materially from those we express today.

Additionally, let me refer you to our unaudited results for the period ended September 30, 2025 that were filed this morning on Form 10-Q. In addition, please refer to our previous filings on Form 10-K, where you'll find risk factors that could cause actual results to differ materially from these forward-looking statements. I also encourage you to review the investor highlights posted this morning as we go through our remarks.

With that, I'll turn over the call to John Hadjipateras.

Thank you, Ted. Good morning, and thank you for joining Ted, John, Tim and me. My colleagues will provide you with detailed comments on our financial results, our market outlook and our emissions reduction and operational progress.

First, I'd like to highlight the following. Our dividend declared today of $0.65 per share totaling $27.8 million reflects our commitment to returning capital to shareholders in a manner that is disciplined and aligned with market conditions. This will be our 17th dividend payment, bringing total dividends distributed to over $695 million and total capital of almost $925 million returned to shareholders.

The VLGC market improved in the third calendar quarter. The Baltic Index on -- averaged [ 68,000 ] per day, up from 48,000 in the second quarter and 33,000 in the first quarter, more than doubling from the start of the year. The index peaked at just under 80,000 per day in mid-August and then eased back towards the mid-50s by the end of September.

Global seaborne LPG liftings made a record high at 37.21 million tons, underpinned by record quarterly exports from North America and from Saudi Arabia. We believe that modern fuel-efficient VLGCs like ours are well positioned to benefit from the constructive freight environment. Tim will elaborate on the fundamentals driving the VLGC market and our outlook.

On the operational side, we are almost done with 10 of our 12 dry dockings planned for 2025. This year, we had an unusually large number of dry docks and our -- as our ships reach their 5- and 7.5-year docking cycles. During the quarter, we also published our 2024 corporate responsibility report. John Lycouris will provide an update on the progress made in our docking program and ammonia retrofits.

And Ted will now present our quarterly financial overview. Ted?

Thanks. Today, I'll focus on our unaudited second quarter results, capital allocation and our financial position and liquidity, the discussion of our second quarter results, you may wish -- you may find it useful to refer to the investor highlight slides posted this morning on our website.

I remind you that my remarks will include a number of terms such as TCE, available days and adjusted EBITDA. Please refer to our filings for the definitions of these terms.

Looking at our second quarter chartering results, we achieved TCE revenue per available day of $53,725, which reflected the strong rate environment. Interestingly, each month's TCE during the quarter was sequentially better than the prior months, again, underscoring the favorable market dynamics. We generated over $30 million in free cash flow to equity during the quarter.

As our entire spot trading program is conducted through the Helios Pool, Helios' reported spot results are the best measure of our spot chartering performance. For the September 30 quarter, the Helios Pool earned a TCE of $53,500 per day for its spot and COA voyages.

On Page 4 of our investor highlights material, you can see that we have 2 Dorian vessels on time charter within the pool, indicating spot exposure of about 90% for the 30 vessels in the Helios Pool.

Turning to the quarter ending December 31, 2025, we currently estimate that we have fixed just over 75% of the fixable days in the quarter at a TCE of about $57,000 per day. The rate includes both spot fixtures and time charters in the Helios pool only.

Given the difficulty in predicting loading rates, which has a huge effect on revenue recognition, dysport options in some charters and the complexity of some of our COAs, these estimates we quote during these calls and the rates actually realized can vary.

Daily OpEx for the quarter was 9,474, excluding dry docking-related expenses, which was down over 6% from the prior quarter's 10,108. Virtually all major cost categories declined, which was certainly a good effort by our technical management team.

Our time charter in expense for our TCN vessels came in at $13.7 million or slightly less than $30,000 per day. The quarter's TCN expense reflected the addition of the Crystal Asteria at the end of June, while the BW Tokyo entered on the last day of the quarter to minimal P&L effect. For the December quarter, we estimate TCE expense to be approximately $18 million, reflecting full quarter contribution from the Crystal Asteria in the BW Tokyo.

Total G&A for the quarter was $12 million and cash G&A, that's G&A excluding noncash compensation expense, was about $7 million, reflecting our core G&A. We had noted last quarter that we expected an approximately $3 million increase in stock comp expense due to the share grants made during the quarter. That will not recur for the rest of the year.

Our reported adjusted EBITDA for the quarter was $85.7 million. Total cash interest expense for the quarter was $7 million, of which we capitalized about $600,000. Our current debt cost is about 5.1%, reflecting the heavily hedged and fixed nature of our various pieces of debt.

September 30, 2025, we reported $268.4 million of free cash, which was down about $10 million from the prior quarter, largely due to the payment of the new building installment in September. As John touched on and as we disclosed this morning, we will pay a $0.65 per share irregular dividend or roughly $28 million in total on or about December 2 to shareholders of record as of November 17.

With a debt balance at quarter end of $530 million, our debt to total book capitalization stood at 33.2% and net debt to total cap at 16.4%. With an undrawn $50 million revolver and a $100 million accordion feature in our existing loan agreement, strong free cash balance and one debt-free vessel, we feel well capitalized for fleet growth and renewal or for whatever challenges may arise.

During the prior quarter, we completed 3 dry dockings and anticipate 2 more dry dockings during November and December. That will complete the drydocking program for our 2015 built vessels. Also, in addition to the newbuilding payment we made in September, we will make an additional roughly $12 million payment during the quarter ending December 31, 2025.

The irregular dividend declared last week brings to $16.95 per share in regular dividends that we have paid since September 2021.

Again, some investors and analysts like to suggest that these dividends are no longer irregular. We underscore that they are indeed irregular and subject to the discretion of our Board. VLGC rates are not regular and neither is the geopolitical environment, as recent weeks have shown. And thus, we don't think our dividend policy should be either.

Looking at our dividends in a more traditional context, our net income since June 30, 2021, that's the quarter immediately prior to our first irregular dividend, has been cumulatively about $700 million.

While including the dividend to be paid next month, we have returned approximately $695 million in dividends in total to our shareholders and cumulatively, including share buybacks and our open market tender offer, over $925 million. We will continue to maintain a steady balance between dividends, deleveraging and fleet investment.

With that, I'll pass it over to Tim Hansen.

Thank you, Ted. Good day, everyone. The quarter ending September 30, 2025, saw an average freight market improvement compared to the quarter prior with less volatility. VLGC market fundamentals remained firm through the quarter with a high inventory build in the United States, keeping on Belvieu prices attractive for Far East importers and supporting the West to East arbitrage.

U.S. monthly exports of LPG and VLGCs were in the 4.6 million to 5.1 million tons per month range, an improvement on the quarter prior. Middle East VLGC exports for the quarter also improved compared to the quarter prior, growing by about 200,000 metric tons for the third calendar quarter.

The VLGC market fundamentals were impacted in the third calendar quarter by 2 factors, one was positive for freight and one negative. The very positive factor was a sudden spike in Panama congestion and a subsequent increase in auction fees to transit that was seen from the end of July to early August.

Although the increased congestion added cost to the industry and complicated voyage spending, delays absorbed capacities from the market and prompted more VLGCs to ballast via the Cape of Good Hope to the U.S. Gulf, tightening vessel supply for the loading in September and October.

Although a definite answer to why the Panama Canal saw sudden congestion remains elusive, several market commentators have suggested that front loading on container ships prior to the tariffs coming into effect.

The factor pressuring the VLGC market was brought about by actions or reactions on repositioning vessels for those preparing for the U.S. port service fees effective on October 14.

Around the start of September, VLGC owners and operators considering the risk of being deemed related to China by USTR Section 301 regulations with tonnage in ballast to the U.S. load ports began to discount freight to ensure lock in cargoes that would allow the vessel to load and sail from the U.S. before 14th of October. The discount offers put a downward pressure on the West to East freight market.

Meantime, the same owners and operators also stopped ballasting more ships towards the U.S. Gulf and those vessels added VLGC supply to the Middle East and the increased supply imbalance the market in the East.

If the second quarter tested the resilience of the LPG market fundamentals, the third quarter reaffirmed that it was not a one-off. Export from the United States continue to flow to a more diverse range of import countries, and Chinese importers were able to find some alternative to cover the reduced imports from the United States.

The spike in Panama Canal congestion demonstrated the tight supply-demand balance for VLGCs when geopolitical factors are not complicating the picture. And when a geopolitical or external factor causes shocks, we have seen the VLGC players respond to this with agility.

The quarter ending September 30, 2025 continued the improvement in freight from the quarter prior, with both East and West markets up about 28%. The delivery schedule of newbuilding remains limited for the rest of the year, and the agility of the VLGC markets demonstrate an ability to capture upsides that may appear going forward.

Furthermore, although the disruptive factor of fees added freight positive inefficiencies to the market, the later that we post the fees together with the seeming relaxation in trade tensions between the U.S. and China, we believe, will be supportive for the fundamentals of the LPG and VLGC freight markets going forward.

With that, I'll pass it over to John Lycouris.

Thank you, Tim. At Dorian LPG, we are committed to continually enhancing energy efficiency and promoting the sustainability of both our operations and our vessels.

Our scrubber vessel savings for the second fiscal quarter of '26 amounted to $1,363,000 or about $1,140 per calendar day per vessel, net of all scrubber operating expenses. Overall savings were affected this quarter due to the dry docking of several vessels and the heightened market volatility stemming from global tariff announcements and geopolitical uncertainties.

Fuel differentials between high-sulfur fuel oil and very low-sulfur fuel oil averaged $74 per metric ton, while the differential of LPG as fuel versus the very low-sulfur fuel oil stood at about $132 per metric ton, making LPG economically attractive for our dual-fuel vessels. We now operate 16 scrubber-fitted vessels and 5 dual-fuel LPG vessels.

During the current quarter, 2 vessels are undergoing special survey and dry docking, including one that is also being upgraded for the carriage of ammonia cargoes. Since the beginning of the calendar year, 10 vessels were successfully completed with their special survey and dry docking, and this reflects our continued commitment to maintaining a modern, efficient and environmentally adaptable fleet. Our dry docking program for 2015-built vessels is now -- will be largely complete by the end of this calendar year.

Driven by stronger market conditions in 2025, vessels in ballast generally operated at higher speeds compared to 2024. Despite the increase in speed, which typically has an adverse effect on CII ratings, the DLPG fleet remains well within compliance limits. The installation of energy-saving devices, the application of premium hull coatings and continuous performance monitoring, combined with operational enhancements, have significantly improved the emission profile of our fleet.

Forecast extending through 2030 based on the IMO's revised CII reduction targets, indicate that our fleet is well positioned to maintain compliance and continue demonstrating strong environmental performance. CII is the Carbon Intensity Index, which assesses the operational efficiency of our vessels and their contribution to greenhouse gas emissions.

At Dorian, we leverage advanced digital platforms and dashboards to drive performance and efficiency. Enhanced data validation and engine analytics support optimized operations and result in energy savings. The fleet remains fully compliant with evolving emission frameworks, including EU ETS, CII, EEXI and FuelEU Maritime. And our fleet performance team works closely with chartering to optimize fuel consumption during the voyages.

The average fleet AER for the third quarter of 2025 was 9.3% lower than the IMO required target for 2025. AER is the annual efficiency ratio metric, which calculates the carbon intensity of our vessels operations.

The 1-year postponement of the IMO's decision to implement the net zero framework does not change Dorian's commitment to invest in fuel efficiency, improve performance and decrease greenhouse gas emissions. This delay may heighten regulatory uncertainty and reinforce reliance on regional schemes, further fragmenting the global regulatory landscape. We are confident that our company and fleet are well equipped and fully prepared to meet any regulatory challenges ahead.

And now I would like to pass it over to John Hadjipateras for his comments.

Thank you, John, and Tim and Ted. Chelsea, we can open for questions. If anyone has to ask any questions, we're here.

[Operator Instructions] And our first question will come from Omar Nokta with Jefferies.

Nice quarter, obviously, in terms of how much stronger your realized rate has come up, especially relative to the past maybe 4 or 5 quarters. But just wanted to get a sense, the overall rate of, say, 53,000, 54,000 was a bit lower than what we were thinking.

And just wanted to ask, I know, Ted, you do a very good job of giving us sort of the bookings on the bookings to date each quarter. If I recall, you had gotten something over 60,000 for 70% of the quarter last time around. And just wanted to get a sense of what caused the final figure to be lower? Because it looked like VLGC spot rates remained fairly firm. Was it just simply an accounting treatment? Is it low to discharge the dry docks? Any color you're able to give would be helpful.

Yes. We'll do that. I'll let Ted expand on it, obviously. But it is -- really, the discrepancy was from timing and in terms of -- we obviously try to give you the best. And when we give the guidance, it is -- it reflects what we have booked. But there are often sort of timing discrepancies arising from more off-hire days sometimes, later loadings, slippage from one quarter into the next.

Ted, you take it.

Okay. Yes. I mean, I think, Omar, obviously, we were we're aware of the delta versus guidance. And like John said, a bit of load to discharge accounting based on timing. Look, there's dysport options, as you know, in our sector. And so our guys, we book things based on what we know at the time. And if the charter changes his mind, that can change the -- what we realized during the quarter.

And also, the dry docking days affect the -- clearly, not only the amount of revenue, but obviously drives that has an effect on the TCE rate as well. So we're -- like John said, we're always -- we try to give the best information. We didn't quite work out as well this quarter. But again, with the end of the dry docking program largely, we feel like the guidance that we just gave should be much more on target for the coming quarter or the current quarter.

Okay. All right. So it sounds like a bit of a one-off with a few moving different factors last time around. So the 57,000, I think, that you gave us earlier that all else equal, that should be a fairly good barometer of what to expect for...

We believe so, Omar, yes.

Okay. Great. And then maybe just a second question or a follow-up. We've been seeing here spot rates have really got a bit of momentum here. And it's maybe at a unique time, I guess, on the calendar. It seems like we're heading into the part of the seasonality where things start to come off and it put downward pressure on rates, and now we're seeing things pick up. Are you able to give kind of a perspective on what's behind this latest move?

Yes. Tim?

Yes. I think there is a lot of wait-and-see here before U.S. and China met in Korea. So I think there was like an end or hold on fixing activity, where you saw the rates drop until recently and then it's kind of catching up. So people are really waiting for this to kind of at least have some direction what the trade disputes or agreements was going to be.

And then, of course, also the postponement of the port fees have put like a relief to the market and gave people some room to work and some at least a horizon where they can take decisions going further forward. So on top of the -- coming into the winter, then this helped activity to kickstart again.

[Operator Instructions] And at this time, there are no further questions in the queue.

Thank you, Chelsea. Thank you, everyone. And Omar, thanks for your questions, and we look forward to picking up again next quarter. Thank you. Bye-bye.

Thank you, ladies and gentlemen. This concludes today's program, and we appreciate your participation. You may disconnect at any time.

Good morning, and welcome to the Dorian LPG First Quarter 2026 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. Additionally, a live audio webcast of today's conference call is available on Dorian LPG's website, which is www.dorianlpg.com.

I would now like to turn the conference over to Ted Young, Chief Financial Officer. Thank you, Mr. Young. Please go ahead.

Thank you, Leo. Good morning, everyone, and thank you all for joining us for our first quarter 2026 results conference call. With me today are John Hadjipateras, Chairman, President and CEO of Dorian LPG Limited; John Lycouris, Head of Energy Transition; and Taro Rasmussen, Vice President of Chartering. As a reminder, this conference call webcast and a replay of this call will be available through August 8, 2025.

Many of our remarks today contain forward-looking statements based on current expectations. These statements may often be identified with words such as expect, anticipate, believe or similar indications of future expectations. Although we believe that such forward-looking statements are reasonable, we cannot assure you that any forward-looking statements will prove to be correct. These forward-looking statements are subject to known and unknown risks and uncertainties and other factors as well as general economic conditions. Should one or more of these risks or uncertainties materialize or should underlying assumptions or estimates prove to be incorrect, actual results may vary materially from those we express today.

Additionally, let me refer you to our unaudited results for the quarterly period ended June 30, 2025, that were filed this morning on Form 8-K. We expect to file our 10-Q on August 5, 2025. In addition, please refer to our previous filings on Forms 10-K, where you'll find risk factors that could cause actual results to differ materially from these forward-looking statements. Finally, I would encourage you to review the investor highlight slides posted this morning on our website.

With that, I'll turn over the call to John Hadjipateras.

Hello, and thanks for joining us. My colleagues, Ted, John and Taro, will provide you with detailed comments on our financial results, our emission reduction and operational progress and our market outlook. But first, I'd like to highlight the following: our dividend of $0.60 per share, totaling $25.6 million reflects our commitment to returning capital to shareholders in a manner that's aligned with market conditions and our policy of distributing earnings prudently. This will be our 16th dividend payment, bringing total dividends distributed to over $665 million and total capital of more than $900 million returned to shareholders.

In the second quarter of the year, the market proved resilient. Freight risk strengthened, supported by healthy arbitrage economics and geopolitical tensions in the Middle East. Uncertainty caused by tariff escalation displaced ships from the U.S. Gulf to the Middle East and send more cargoes to India. While a U.S. mediated seize fire between Israel and Iran in late June brought some stability, charter has remained cautious.

U.S. LPG exports continue their multiyear growth. Growth trend facilitated by ongoing expansion of U.S. fractionation plants and export terminal capacity as well as high NGL output. Middle Eastern exports were also higher following the partial unwinding of OPEC+ quotas and increased production from new regional gas projects. Taro will elaborate on the fundamentals of the VLGC market and on our outlook.

On the operational side, we completed 10 of our 12 dry dockings planned for 2025. John will provide an update on our initiatives and our decision to convert some of our VLGCs to facilitate the carriage of ammonia.

I'll now pass you on to Ted for our quarterly financial overview.

Thanks, John. My comments today will focus on our unaudited first quarter results, our financial position, liquidity and of course, capital allocation. For the discussion of our first quarter results, you may find it useful to refer to the investor highlight slides posted this morning on our website. Remember that my remarks will include terms such as TCE, available days and adjusted EBITDA, please refer to our filings for the definitions of these terms.

Looking at our first quarter chartering results, we reported a TCE per available day of $39,726, which was a good result despite our heavy dry dock schedule during the quarter that resulted in some 195 days that were not available for revenue generation. I would note that our June results were much stronger than the previous 2 months, which is indicative of the stronger market environment in which Taro will elaborate.

Also the Q1 results were sequentially stronger than the March 31 quarter. The Helios Pool reported spot rates for the quarter of about $37,700 and approximately $38,900 across the pool, underscoring the strength of our charter out portfolio in the pool.

On Page 4 of our investor highlights materials, you can see that we have 2 Dorian vessels on time charter within the pool, indicating spot exposure of just over 93% for the 29 vessels in the pool.

The forward bookings for the quarter ending September 30, 2025, reflect a strong increase in rates since late May into June. We currently estimate that we have fixed approximately 70% of the pool's fixable days in the quarter at a TCE in excess of $67,000 per day. The rate includes spot fixtures and time charters in the pool. As you know, loading [indiscernible] disc port options and COAs can all cause the estimates we quote during these calls and the rates actually realized to vary.

Daily OpEx for the quarter was $10,108 excluding drydocking related expenses, which was down marginally -- meaningfully rather from the March quarter's $11,001. Spares and stores costs led to decline. This quarter saw an over $1,300 per day difference between reported OpEx that includes expense drydocking amounts and our preferred measure of OpEx that excludes those costs. The noncapitalized drydocking expenses totaled about $2.6 million and equated to $0.06 per share for the quarter.

Our time charter in expense for the 4 TCE vessels came in right around $29,000 per day, which compares favorably to our fleet-wide TCE for the quarter, showing the profitability of our charter-in program. Dorian recently chartered in the Crystal Osteria, a dual field VLGC that will trade in the Helios Pool. Going forward, we anticipate the quarterly TCN expense will be approximately $14 million, $15 million.

Total G&A for the quarter was affected by bonuses booked during the quarter of $8.3 million or $0.19 a share. Excluding the bonuses and the noncash compensation expense, cash G&A was around $6.5 million. For the September 30 quarter, we estimate that noncash compensation expense will increase by roughly $3 million over this quarter to reflect the impact of new share grants. Again, that amount is only for the coming quarter. Our reported adjusted EBITDA for the quarter was $38.6 million. But adjusting further for the bonuses and the expense drydocking amounts, it would have been $49.5 million.

Total cash interest expense for the quarter was $7.1 million, which is marginally down sequentially from the prior quarter. And you should note that we capitalized $500,000 of interest expense on our new building, which reduced the amount on the face of the P&L. Principal amortization remains steady.

As John mentioned, looking ahead, our dry dock program is largely complete, although we expect to dry dock 2 more vessels this quarter. Total drydocking costs for those 2 vessels and remaining costs for dockings completed in the April-June quarter are expected to be between $6.5 million and $7 million. We currently estimate that roughly 1/3 of that amount will be expensed as OpEx. After that, we only have shorter in-water surveys to complete. Also, we do have 2 remaining progress payments on our new building in September and December 2025, each roughly $12 million.

At June 30, 2025, we reported [indiscernible] of free cash. Cash flow during the quarter was affected by our drydocking cash outlays and the foregone revenue, but we still finished with a very healthy cash balance. As disclosed this morning, we're paying a regular dividend of $0.60 per share or roughly $25.6 million in total on or about August 27 to shareholders of record as of August 12. Including this dividend, we've returned over $900 million in cash through dividends of self-tender offer and open market repurchases.

With a debt balance at quarter end of $543.5 million, our debt to total book capitalization stood at 34.4% and our net debt to total cap at 16.8%. We have well structured and attractively priced debt capital with an all-in cost of about 5.1%, an undrawn $50 million revolver and 1 debt-free vessel. Coupled with our strong free cash balance, we have a comfortable measure of financial liquidity. We expect our cash cost per day for the coming year to be approximately $26,000 per day, excluding the remaining capital expenditures for dry docking and the progress payments on our new building.

Including a regular dividend to be paid this month, we have paid over $665 million of dividends and have generated net income of $652 million over the same time period. Our Board [indiscernible] current earnings, our near-term cash forecast, future investment needs in the overall market environment among a number of factors in making its determination at the appropriate level, if any, for our dividends. The $0.60 per share dividend reflects a constructive market view, reflecting our forward bookings, the more limited impact of drydockings and a somewhat more stable global trade environment. We continue to be on the lookout for fleet renewal opportunities and we'll be judicious with our free cash flow, working to balance shareholder distributions, debt reduction and fleet investment.

With that, I'll pass over to Taro Rasmussen.

Thank you, Ted, and good day, everybody, and thank you for dialing in. The quarter ending June 30, 2025, witnessed dramatic impacts from the geopolitical situation for some weeks, but mostly saw a steady rise in freight markets. The primary geopolitical factor creating freight market volatility, albeit briefly, was the announcement of near global tariffs by the United States. Bonding campaigns in the Middle East had several consequences, but did not rattle the VLGC market to the extent of Liberation day.

Middle East hostilities did restrict willingness of several VLGC players to call Middle East load ports and the restricted Red Sea transit has kept longer vessel transits in place. VLGC market fundamentals remained firm despite the external impacts of tariffs and hostilities. NGL production in the United States continued to grow and the inventory build season began as expected. Other than a 2-week period following the tariff [indiscernible], increased supply of LPG lowered Mont Belvieu prices and supported an open west to east arbitrage. U.S. exports of LPG on VLGCs remained stable for the quarter with monthly exports in the 4.6 million to 4.8 million tonnes per month range.

Middle Eastern exports continued in line with forecasts, and LPG as a commodity continued to find outlets in the Far East despite some rumblings about [ petchem ] profitability.

With benefit of some perspective, several things are notable. Firstly, the April 2 announcement of tariffs jilted many markets. The VLGC freight markets are approximately a halving in the Baltic indices within 4 days. The correction was likewise swift with most losses recovered within the next 5 working days. Secondly, the VLGC market reacted quickly to the shock, enabling the recovery in freight rates. Chinese LPG imports over the quarter were in line with expectations despite a dramatic fall in U.S. origin product. The average monthly import of U.S. origin LPG in China was about 500,000 metric tons over the quarter compared to the average monthly import of about 1.5 million tonnes in the 8 preceding months back to August 2024. Imports of U.S. origin product duly increased in various other countries such as Japan and India.

The end June, July period typically sees low on activity with lower freight rates. This has not been the case in 2025. Adaptability by the VLGC industry and reaction to the tariffs likely preserved market profitability, helped by the inefficiencies arising from the need to recalibrate trade flows. Increasing tensions in the Middle East through June also contributed to a steady, but firming freight market during the quarter. With the risk of direct hostilities increasing fewer vessel operators were competing for Middle East cargoes. Furthermore, the Red Sea sailing passage was again unsafe for almost all vessels after a period of looking realistic.

In January through May, 4 to 5 VLGCs transited the Red Sea late in a month, but only 1 in June. This inefficiency added ton miles to U.S., Algerian and Red Sea LPG exports.

Lastly, the exemption of restrictions on ethane exports from the U.S. to China meant that ethane carriers did not need to enter the VLGC market. Despite the brief shock to the freight market following the announcement of tariffs, the quarter ending June 30, 2025 avoided the otherwise seasonal summer low. The Eastern market improved about 46% over the quarter and the Western market improved almost 16%. Expectations for the rest of the year furthermore remain positive with a limited delivery schedule of new builds and roughly 13% capacity expansion at U.S. Gulf terminals.

Thank you. I will now pass over to Mr. John Lycouris.

Thank you, Taro. At Dorian LPG, we are committed to continually enhancing our energy efficiency and promoting the sustainability of both our operations and our vessels. Our scrubber vessel savings for the first fiscal quarter of 2026, amounted to $961,000 or $813 per calendar day, net of all scrubber operating expenses. The savings were impacted by the dry docking of several vessels during this quarter, as well as by the market volatility caused by global tariff announcements and geopolitical events. Fuel differentials between high sulfur fuel oil and low sulfur fuel oil averaged $55 per metric ton, while the differential of LPG as fuel versus low sulfur fuel oil stood at $71 per metric ton, making LPG economically attractive for our dual fuel vessels. .

We now operate 16 scrubber-fitted vessels and 5 dual fuel LPG vessels. Since the start of this calendar year, we completed 10 vessels, special survey, combined with their drydocking. We have a further 2 vessel schedule for special survey and dry dock in the fourth quarter of 2025. There are 4 vessels that had dry dock last year during the third and fourth quarters of 2024, which are now due to past special survey within this calendar year. This dry docking program was structured to ensure that all necessary pairs, class surveys and retrofits were consolidated within the vessels mandated special survey and dry dock period. The approach minimizes the risk of vessels requiring scheduled dockings at a later time.

Continuous monitoring of vessel performance has allowed the emerging issues to be addressed proactively during scheduled dry dockings, reducing the likelihood of future interruptions. It ensures technical and operational continuity with optimized fleet reliability throughout the year.

As previously reported, the third VLGC vessel to carry ammonia cargo is planned to be upgraded during its drydocking slot in the fourth quarter of 2025. Once this last vessel is completed, 5 VLGC vessels in our Dorian LPG fleet will be able to carry ammonia cargoes, which includes our new building VLGC vessel, which delivers in 2026. We believe the ammonia cargo capability upgrade enhances the fleet's commercial optionality and its readiness for employment when the first ammonia projects developed and the large ammonia cargo markets are established.

I noted that fleet AR for the second quarter of 2025 was 8.5% better than the IMO 2025 target. We expect further improvement in the third quarter and fourth quarters as the dry dockings and the installation of energy saving devices on recently completed vessels are fully reflected.

AR is the annual efficiency ratio metric, which calculates the carbon intensity of our vessels' operations. The Dorian LPG fleet exceeds the IMO's EXI and CII regulations. CII in particular, is the carbon intensity index, which assesses the operational efficiency of our vessels and their contribution to greenhouse gas emissions. An in-house developed decarbonization planning tool models IMO CII ratings, EU and IMO regulatory scenarios across our fleet by incorporating projected EST installations, alternative fuel mixes and differing operational profiles.

Finally, we have developed a compliance cost planner for ETS, [indiscernible] and the IMO net zero frameworks. This tool enables real-time forecasting of compliance costs, penalties and cargo level impacts, supporting the creation of decarbonization strategies, both at the vessel level and across the fleet. Our continued focus on energy and emission savings reflects our belief that environmental responsibility aligns with long-term value creation for our shareholders.

And now I would like to pass it over to John Hadjipateras for his final comments.

Thank you very much. Thank you for everyone who is checked in today. I don't think we have any questions. So if we don't, I leave you with it and wish you a happy rest of the summer until next time. .

[Operator Instructions] We'll take a question from Omar Nokta of Jefferies.

Thanks for the update. I did have a couple of questions, just a bit more on the macro side of the business. Clearly, the market's gotten quite a bit stronger. I just wanted to ask, and you touched on this in your comments earlier. But just when we think about how the second quarter developed, there was obviously quite erratic [indiscernible] tariffs, but we didn't just recover in terms of VLGC spot rates that have actually really strengthened. And it's almost like things have kick-started into high gear. And when we compare to, say, last year where you're earning basically double -- last year's spot rate at this time. Could you maybe just give a sense of what's driving this market? What has really propelled it from where it was earlier this year?

Sure. Happy to, Omar, and very happy to hear your voice. I was kidding -- I was hoping that we'd hear you. I'm going to give you Taro to answer your question because I think he can make the case and give you on the field feedback better than I can.

Thank you, John. Thank you for the question, Omar. I believe the answer lies in the fundamentals primarily with the strength of the U.S.'s ability to produce NGLs and get it exported. Is it different to last year? Well, it's the growth and it shows that the balance in the market is easily made positive with incremental growth and long may that continue. And I think it's a very healthy reflection of the wider market that using experiences from the past whenever there's been trade barriers between the U.S. and China that industry players were able to reflect on past learnings, adapt them and get trade going back to normal as soon as possible, made all of this possible because if the trade flows could not realign, et cetera, you wouldn't be able to take advantage of the healthy fundamentals.

And the last point I would make on to your question, the Red Sea transit difficulties that have escalated this year at various points, they have helped lengthen ton miles. I hope that answers your question.

It does provide some good context. And I guess, maybe perhaps somewhat related, perhaps a bit more complex. But just generally, when we think about the U.S. export arb, it feels like the freight rate is capturing the lion's share of that arb versus a year ago where it was getting a much smaller piece. What do you think has kind of changed? If you can point to it, that's allowed the freight part to capture such a much wider part of the export spread?

Yes. There was the increased capacity -- terminals. But Taro, can you elaborate?

Yes. I think the last year was, in many ways, an anomaly. It's been several years since we had seen such capability and strength in the terminals to absorb more value of the arbitrage [indiscernible] I would argue driven partly last year due to reaction to weather phenomenon and the knock-on effects of delays that hurricanes leading to -- or and then concurrently, up and bid tug boats in the Houston Ship Channel, et cetera. So it was unique factors with a long trail of effect. This year has been more driven by other external factors in other parts of the world and political in nature and geopolitics, and perhaps not the full explanation to a very good question, but I hope it helps.

I just would point out, Omar, that just as Taro touched on, trailing fees were way down year-over-year.

And that's, I guess, the function of the expansion. .

Taro, if you want to?

Expansion of the terminal capacity, yes. Yes. .

Yes. with more coming online this year, yes. .

Yes.

Got it. And final one. You mentioned -- you mentioned the ethane part of the market, which obviously isn't necessarily LPG, but the -- with that ethane now moving, there was a concern initially that ethane would maybe -- those ethane carriers would go into other markets. What do you think -- if we were to fall into an issue where ethane in the U.S. can't be moved and those ships now are looking for business. What do you think is more likely that they go into the VLGC trade or is it that they would make it -- try to make their way to the LNG trade. Have you thought about that? Or any way to kind of think about which way that those ships would go if we get into that type of market?

I think we look at them as an overhang in the -- if the ethane trade for some reason, were stopped, they would be entering the VLGC market. And that's the way we've looked at it. I haven't got any sense that they would go into LNG. I don't think they're capable of doing it. But the -- but we're also kind of confident that it won't happen because it's too much of our exports are being absorbed by China and too much of China and almost all of every that China gets has to come from us. So we don't -- I don't think it will be -- it's going to happen. But if it did, it was any reason, that was already the talk that -- there may be -- we may see some ships kind of creeping into our business. Also the turn -- I mean, if you did it, then you have to get back into ethane. It's not -- you can't just keep going back for ethane to LPG. I mean you can go from LPG to the -- sorry, from ethane to LPG easily, but not the other way around.

Okay. And thanks, guys, for the detail and update.

Thank you, and it appears that we have no further questions at this time.

Okay. Well, thank you all again. Thank you, Omar, and have a good rest of the summer.

This does conclude today's conference. You may now disconnect. Everyone, have a great day.

Thank you, Mr. Lee. .