Summary
Today, BW LPG announced its Q1 2025 financial results.
We are pleased to report a Q1 2025 Net Profit After Tax (NPAT) of US$67 million, yielding an annualised return on equity of 14%. The Q1 profit attributable to the equity holders of the company was US$46 million, and earnings per share were US$0.30. The Board has declared a dividend of US$0.28 per share.
For our Commercial Performance Shipping, we are glad to announce a robust Time Charter Equivalent (TCE) income for Q1 2025, averaging US$39,800 per available day, with 96% fleet utilisation.
Q1 2025 Earnings Presentation
Download our earnings presentation here.
Q1 2025 Interim Financial Report
Download our interim financial report for the quarter here.
Q1 2025 Earnings Presentation Recording
Watch a recording of our earnings presentation for the quarter here.
Q1 2025 Earnings Presentation Transcript
Read the transcript of our earnings presentation for the quarter here.
Q1 2025 market update and outlook
For the first quarter of 2025, spot rates developed in line with seasonal patterns common for this time of year. The market saw a relatively moderate impact from cold weather and fog in the US, and the benchmark US – Far East route averaged US$32,000/day for the full quarter. Subsequently, the outbreak of a trade war between China and the US and later a temporary roll-back of most US/China tariffs caused substantial short-term fluctuations in LPG shipping economics as well as VLGC spot rates. Despite this, VLGC earnings have shown resilience, as the market adapts to new trading conditions.
Cargo movements Q1 2025
LPG exports carried on VLGCs out of the US grew nearly 10% during Q1 2025 compared to the same period in 2024. While VLGC loadings were negatively affected by fog and cold weather during the first quarter of 2025, the market impact was not as severe as during the cold snap experienced during Q1 2024. So far in the second quarter, VLGC loadings out of the US gulf have continued at a high pace.
In the Middle East, LPG exports on VLGCs grew a modest 2.8% during Q1 2025 compared to Q1 2024, largely due to the OPEC+ production cuts remaining in effect. Recently however, several OPEC+ members have agreed to increase output and potentially reverse the whole voluntary production cut by November this year. While this could boost LPG exports from the Middle East, it may also weigh on US production if oil prices stay under pressure for an extended period.
Panama Canal
The new Panama Canal locks are currently operating at or near full capacity, while the canal as a whole is well supplied with water. We may see increased number of VLGCs sailing around Cape of Good Hope, if there is more competition for Panama Canal transits or trading patterns change due to import tariffs on LPG.
Fleet Capacity
The VLGC fleet currently stands at 406 ships, with a total orderbook of 109 vessels. Year to date, four new VLGCs have been delivered from shipyards, with another 10 slated for delivery for the remainder of 2025. For new orders, well established shipyards are indicating deliveries no earlier than the end of 2027 or beginning of 2028 for VLGCs. 37 VLGCs – or 9% of the existing fleet is 25 years or older.
Market Outlook
Recently, tariff uncertainty and related short term market disruptions have shaken the VLGC market. At the same time, the underlying fundamentals for the LPG shipping market have remained intact. US production of LPG has continued to grow and export levels remain in line with previous months.
Moreover, LPG shipping remains a supply driven market where excess production is priced to clear in the international market. And while there is still uncertainty surrounding US/China tariffs, we view the prevailing market fundamentals as supportive.
We furthermore anticipate that the additional export capacity coming on stream in the US later this year will facilitate export growth for VLGCs in the mid to high single digits for the years ahead.
Middle East LPG exports are also expected to grow in the mid to high single digits over the coming years, driven by higher gas production from new projects in Saudia Arabia, Qatar and UAE and expected reversal of OPEC+ production cuts.
LPG inventories in China remain at a healthy level and have increased in recent weeks. The average PDH run rate is currently in the low 60% range compared to mid-70% average in Q1 2025. Run rates are likely to increase subject to favourable trading conditions. Four more PDH plants or expansions are scheduled for startup in 2025, followed by a further six in 2026.
69 VLGCs are furthermore expected to dry dock for the balance of 2025, which will absorb capacity from the overall fleet.
The current US – Far East FFA market for CAL2025 is trading at equivalent to approximately US$49,000 per day, reflecting support to the current spot market.
