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Golar LNG, Ltd. GLNG
Q1 2013 Earnings Call Transcript

Transcript Call Date 05/30/2013

Operator: Good day and welcome to the Golar LNG, Ltd. Q1 2013 Results Presentation. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Brian Tienzo. Please go ahead, sir.

Brian Tienzo - CFO: Thank you for that. Hello everyone and welcome to Golar LNG's first quarter 2013 quarter results. My name is Brian Tienzo, and as per usual we'll be taking you through the first quarter highlights as well as the financial highlights also. I'm joined here also by our CEO, Doug Arnell, who will take you through the business updates and summary and outlook sections.

To kick off, let's now turn to Page 4 for the Q1 2013 highlights. As previously announced, Golar LNG Limited now deconsolidated the results of Golar LNG Partners and on the basis that the results of Golar Partners are no longer consolidated, Golar LNG reports operating income of $75.9 million and net income of $85.6 million also. To the extent we are in a transition period for – looking at the results of Golar LNG limited we will also look at the comparative consolidated numbers of how the numbers would have looked like had we continued to consolidate.

Further on, Golar Partners completes its third follow-on equity offering raising net proceeds of $130 million in February. This is by virtue of issuance of $3.9 million units due to public. GP maintains 2% shareholding of GMLP and as a result of this equity raising Golar now owns 50.9% of GMLP.

Golar LNG limited sells its interest in the Company that owns and operates the Golar Maria to Partners for $215 million. This was partly funded by the public offering that Partners did and also assumption of $90 million worth of debt associated with the asset. Subsequent to the dropdown, GMLP increased its dividend to $0.515 per quarter and significantly Golar now has triggered the 25% IDR threshold as part of the increase of distribution from GMLP.

Results on a consolidated basis were affected by the Golar Spirit, completion of drydocking. It was on drydock until up to the 26 of February. We also announced during Q1 that Golar has been chosen as preferred dealer for Jordan FSRU and the Time Charter negotiations and discussions are progressing well.

Finally, the Board declares increased dividend of $0.45 for the quarter. This is despite volatility outlook of the next couple of years and Board has communicated its intention to maintain this level of dividend. To-date, since the IPO of MLP, Golar LNG's dividend has grown by 80% since Q1 2013.

Moving now to Page 5 for the subsequent events, on which Doug will go through in much more detail later. Golar has agreed terms to participate in the Douglas Channel LNG project, with a view of reaching FID in Q3 2013 and start up for the project of late 2015 or early 2016.

Two factors that are likely to impact earnings on a consolidated basis in Q2 will be the Golar Winter drydocking and its modification work. Furthermore, Hilli and Gandria entered layup earlier on in Q2 also.

Turning now to Page 6, this is really just to go through and highlight the differences resulting from deconsolidation of Golar Partners. So, as previously announced the Company has determined that Golar Partners is required to be deconsolidated effective from 13th of December 2012, which as a result of the change in composition of Directors of Golar LNG Partners. The Q1 results, which we made public today, reflect the deconsolidated basis, but for the purposes and to help inventors analyze the underlying performance of the group, we are also showing consolidated basis to help out with that.

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