Higher funding costs squeeze stronger Nakilat revenues

Qatari LNG shipping company Nakiliat reported a 3.6% increase in profit for the first quarter 2023 to QAR396m ($109m).

Nakilat said the gain was driven by increased revenue, which rose 5.3% to QAR1.12 billion, mainly due to better results from joint ventures and higher interest income. The stronger revenue was offset by a 6.2% increase in expenses to QAR 724 million, mainly due to higher financing costs, which rose 18.6% as variable interest rates on the unhedged portion of the debt increased.

Nakilat Managing Director, Ing. Abdullah Al-Sulaiti said: “Despite the ongoing challenges in the global economy and market volatility due to high interest rates and inflation rates, we have remained resilient and delivered solid financial results with a 3.6% increase in net income, which is Purpose, Vision and strategy, we will continue to pursue sustainable growth, capitalize on business opportunities and maintain our position as one of the world’s leading players in the global marine LNG industry.”

The company’s performance was underpinned by robust market demand for LNG shipping services, Nakilat said, along with its focus on operational efficiencies and effective cost management.

LNG ship rates for spot and 3-6 month charters fell from their seasonal highs in the fourth quarter.

Yearly time charter rates have also declined since Q4 2022 but remain significantly higher than Q1 2022 for all ship types.

Source: News Network