Dorian LPG Ltd., a leading owner and operator of modern very large gas carriers (“VLGCs”), yesterday reported its financial results for the three months ended December 31, 2025.
Key Recent Development
Declared an irregular dividend totaling approximately $29.9 million, or $0.70 per share, to be paid on or about on or about February 24, 2026 to all shareholders of record as of February 9, 2026.
Highlights for the Third Quarter Fiscal Year 2026
Revenues of $120.0 million.
Time Charter Equivalent (“TCE”) (1) rate per available day for our fleet of $50,333.
Net income of $47.2 million, or $1.11 earnings per diluted share (“EPS”), and adjusted net income (1) of $47.4 million, or $1.11 adjusted earnings per diluted share (“adjusted EPS”). (1)
Adjusted EBITDA (1) of $74.2 million.
Declared an irregular cash dividend totaling $27.8 million in November 2025, which was paid in December 2025.
John C. Hadjipateras, Chairman, President and Chief Executive Officer of the Company, commented, “Our seafaring and shoreside team delivered a strong operating performance in the quarter. We declared our 17th consecutive quarterly irregular dividend bringing total capital returned including buy backs, since our IPO, to over $960 million. Last quarter the VLGC market again reached a new export record. Demand, as well as freight rates have continued to be strong into the current quarter. We look forward to the delivery, in March, of a newbuilding dual fuel VLGC/AC.”
Third Quarter Fiscal Year 2026 Results Summary
Net income amounted to $47.2 million, or $1.11 per diluted share, for the three months ended December 31, 2025, compared to $21.4 million, or $0.50 per diluted share, for the three months ended December 31, 2024.
Adjusted net income amounted to $47.4 million, or $1.11 per diluted share, for the three months ended December 31, 2025, compared to adjusted net income of $18.5 million, or $0.43 per diluted share, for the three months ended December 31, 2024. Adjusted net income for the three months ended December 31, 2025 is calculated by adjusting net income for the same period to exclude an unrealized loss on derivative instruments of $0.2 million. Please refer to the reconciliation of net income to adjusted net income, which appears later in this press release.
The $28.9 million increase in adjusted net income for the three months ended December 31, 2025, compared to the three months ended December 31, 2024, is primarily attributable to (i) an increase of $39.3 million in revenues; (ii) decreases of $1.8 million in interest and finance costs, $0.7 million of which is due to increased capitalized interest, and $1.5 million in vessel operating expenses, and (iii) a favorable change of $0.6. million in other gain/(loss), net; partially offset by increases of $7.6 million in charter hire expenses, $3.3 million in general and administrative expenses, $0.7 million in voyage expenses, $0.7 million in profit sharing expenses; $0.6 million in depreciation and amortization expenses; and decreases of $1.0 million in interest income and $0.4 million in realized gain on derivatives.
The TCE rate per available day for our fleet was $50,333 for the three months ended December 31, 2025, a 39.5% increase from $36,071 for the same period in the prior year. Please see footnote 5 to the table in “Financial Information” below for information related to how we calculate TCE.
Vessel operating expenses per vessel per calendar day decreased to $10,275 for the three months ended December 31, 2025 compared to $11,097 in the same period in the prior year. Please see “Vessel Operating Expenses” below for more information.
Revenues
Revenues, which represent net pool revenues—related party, time charter revenues, and other revenues, net, were $120.0 million for the three months ended December 31, 2025, an increase of $39.3 million, or 48.7%, from $80.7 million for the three months ended December 31, 2024 primarily due to higher average TCE rates and increased available days. TCE rates rose by $14,262 per available day from $36,071 for the three months ended December 31, 2024 to $50,333 for the three months ended December 31, 2025. The increase in TCE rates was primarily due to higher spot rates and lower bunker prices.
The Baltic Exchange Liquid Petroleum Gas Index, an index published daily by the Baltic Exchange for the spot market rate for the benchmark Ras Tanura-Chiba route (expressed as U.S. dollars per metric ton), averaged $67.767 during the three months ended December 31, 2025 compared to an average of $55.717 during the three months ended December 31, 2024. The average price of very low sulfur fuel oil (expressed as U.S. dollars per metric ton) from Singapore and Fujairah decreased from $570 during the three months ended December 31, 2024, to $452 during the three months ended December 31, 2025. Available days for our fleet increased from 2,210 for the three months ended December 31, 2024 to 2,349 for the three months ended December 31, 2025, mainly driven by an increase in the number of vessels in our fleet, partially offset by a modest increase in off-hire days due to drydocking.
Vessel Operating Expenses
Vessel operating expenses were $19.9 million during the three months ended December 31, 2025, or $10,275 per vessel per calendar day, which is calculated by dividing vessel operating expenses by calendar days for the relevant time-period for the technically-managed vessels that were in our fleet and decreased by $1.5 million, or 7.4% from $21.4 million for the three months ended December 31, 2024. The decrease of $822 per vessel per calendar day, from $11,097 for the three months ended December 31, 2024 to $10,275 per vessel per calendar day for the three months ended December 31, 2025 was partially due to a decrease of non-capitalizable drydock-related operating expenses. Excluding non-capitalizable drydock-related operating expenses, daily operating expenses decreased by $603, or 5.9%, from $10,161 for the three months ended December 31, 2024 to $9,558 for the three months ended December 31, 2025, primarily resulting from reductions of spares and stores.
General and Administrative Expenses
General and administrative expenses were $10.8 million for the three months ended December 31, 2025, an increase of $3.3 million, or 44.4%, from $7.5 million for the three months ended December 31, 2024, driven by increases of $2.0 million in expenses under our Cash Incentive Compensation Plan, $0.6 million in employee-related costs and benefits, $0.3 million in stock-based compensation expense, and $0.4 million in other general and administrative expenses in the period ended December 31, 2025 when compared to the period ended December 31, 2024.
Interest and Finance Costs
Interest and finance costs amounted to $7.1 million for the three months ended December 31, 2025, a decrease of $1.8 million, or 20.5%, from $8.9 million for the three months ended December 31, 2024. The decrease of $1.8 million during this period was mainly due to (i) a reduction of $1.0 million in interest on our long-term debt, (ii) an increase of $0.7 million in capitalized interest, and (iii) a decrease of $0.1 million in loan expenses and bank charges. The decrease of $1.0 million in loan interest on our long-term debt was driven by a reduction of average indebtedness, excluding deferred financing fees, from $579.9 million for the three months ended December 31, 2024, to $526.0 million for the three months ended December 31, 2025, as well as a lower SOFR rate on the 2023 A&R Debt Facility during the three months ended December 31, 2025 when compared to the three months ended December 31, 2024.
Interest Income
Interest income amounted to $2.7 million for the three months ended December 31, 2025, compared to $3.8 million for the three months ended December 31, 2024. The decrease of $1.1 million is mainly attributable to (i) reduced interest rates over the periods presented, and (ii) moderately lower average cash balances for the three months ended December 31, 2025 when compared to the three months ended December 31, 2024.
Unrealized Gain/(Loss) on Derivatives
Unrealized loss on derivatives amounted to $0.2 million for the three months ended December 31, 2025, compared to a gain of $2.9 million for the three months ended December 31, 2024. The $3.1 million difference is primarily attributable to changes in forward SOFR yield curves and changes in notional amounts.
Realized Gain on Derivatives
Realized gain on derivatives amounted to $0.4 million for the three months ended December 31, 2025, compared to $0.8 million for the three months ended December 31, 2024. The unfavorable $0.4 million change is primarily attributable to (i) a $0.9 million reduction of realized gains on our interest rate swaps (ii) partially offset by reduced realized losses on our FFAs of $0.5 million.
Market Outlook & Update
The fourth calendar quarter of 2025 (“Q4 2025”) proved to be a volatile quarter for the LPG product market, beginning in October with a sharp decline in the Saudi Contract Price (“CP”) for propane and butane prices that was more pronounced than many market participants had anticipated. Monthly propane CP prices fell by $25 per metric ton to $495 per metric ton in October 2025, while butane CP prices declined by $15 per metric ton to $475 per metric ton. Average LPG prices across all major regions also weakened at the start of the quarter, not only on a flat-price basis but also relative to crude oil. The steepest decline was observed in the Far East, where propane prices fell by 5% versus Brent.
A recovery in delivered product prices emerged in November, with further strengthening in December as winter seasonal demand took precedence. December saw a cold spell in the U.S., with falling temperatures triggering a reactionary increase in prices. However, strong U.S. NGL production and inventory levels exceeding five-year highs capped upside price potential.
Overall, Q4 2025 saw wider price spreads between the U.S. and major importing regions, improving arbitrage economics for spot propane, though the lower Saudi CP challenged the West-to-East arbitrage in October. On average, Far East propane prices increased from 61% to 64% of Brent from the third calendar quarter of 2025 (“Q3 2025”) to Q4 2025, with a similar rise in Northwest Europe, where propane reached 56% of Brent. U.S. propane values increased by only 1% versus WTI to reach 45%, broadly in line with Q4 2024 levels.
Despite improving supply-chain economics, petrochemical margins remained challenging for several players, particularly in the Far East. Average monthly PDH margins in the Far East on a variable basis turned positive in October 2025 for the first time since the second calendar quarter of 2025 due to the softer feedstock prices. This improvement was short-lived with margins turning negative by the end of October/start of November. Economics were especially challenging for importers of U.S.-origin cargoes that remain subject to an additional 10% tariff. Chinese imports were further constrained by planned plant maintenance.
Propane continued to hold an advantage over naphtha for ethylene production via steam cracking; however, the propane–naphtha spread narrowed over the quarter, tightening from an average of -$96 per metric ton in October to -$35 per metric ton in December. This reflected stronger winter-driven propane demand, while the naphtha market remained bearish.
Geopolitical factors continued to affect LPG and broader oil markets. Early in the quarter, uncertainty surrounded U.S.–China trade relations as the existing 90-day tariff truce approached expiry in early November. The 10% tariff on U.S. LPG imports into China was subsequently extended for a further 12 months. Additional volatility stemmed from the rollout of USTR and Chinese port fees introduced in October. Although a one-year suspension was agreed by both governments in November, the policy uncertainty contributed to heightened market volatility, particularly at the start of Q4 2025.
Average VLGC freight rates eased in Q4 2025, with the Baltic Index averaging around $68 per metric ton, down from approximately $82 per metric ton in Q3 2025. The softer freight market was a consequence of the lower-than-anticipated Saudi CP announcement for October creating uncertainty in trade economics and slowing shipping enquiries at the beginning of the quarter. Amidst the uncertain environment, the announcement of reciprocal port service fees from Chinese authorities on October 10, 2026 added further uncertainty and potential costs. The immediate impacts were felt on vessels with cargoes on board destined for discharging in China and further disrupted the Far East product market. LPG cargo quotes for destinations other than China enticed more aggressive pricing from ship operators, adding further pressure to the freight markets. Following the U.S.-China summit in Busan, South Korea at the end of October suspending Port Service Fees until November 9, 2026, normalcy returned to the VLGC shipping market with a widening arbitrage supported by a warm start to the winter season in North America, and increased heating demand in Asia. Clearing of the backlog of unfixed vessels slowed the upward correction in the freight markets, but the market was in contango from the middle of November. Although the freight market was assessed higher towards the end of December, fog delays in the Houston Ship Channel caused delays and impacted fleet utilization metrics.
During Q4 2025, the global VLGC fleet expanded only marginally with the delivery of two new vessels. Looking ahead, an additional 111 VLGCs/VLACs, equivalent to roughly 10.0 million cbm of carrying capacity, are scheduled for delivery by calendar year 2029. The average age of the global fleet now stands at approximately 12.0 years, while the VLGC/VLAC orderbook represents around 27.0% of the existing fleet.
The above market outlook update is based on information, data and estimates derived from industry sources available as of the date of this release, and there can be no assurances that such trends will continue or that anticipated developments in freight rates, export volumes, the VLGC orderbook or other market indicators will materialize. This information, data and estimates involve a number of assumptions and limitations, are subject to risks and uncertainties, and are subject to change based on various factors. You are cautioned not to give undue weight to such information, data and estimates. We have not independently verified any third-party information, verified that more recent information is not available and undertake no obligation to update this information unless legally obligated.
Financial Information
The following table presents our selected financial data and other information for the periods presented:
Seasonality
Liquefied petroleum gases are primarily used for industrial and domestic heating, as chemical and refinery feedstock, as transportation fuel and in agriculture. The LPG shipping market historically has been stronger in the spring and summer months in anticipation of increased consumption of propane and butane for heating during the winter months. In addition, unpredictable weather patterns in these months tend to disrupt vessel scheduling and the supply of certain commodities. Demand for our vessels therefore may be stronger in our quarters ending June 30 and September 30 and relatively weaker during our quarters ending December 31 and March 31, although 12-month time charter rates tend to smooth out these short-term fluctuations and recent LPG shipping market activity has not yielded the typical seasonal results. The increase in petrochemical industry buying has contributed to less marked seasonality than in the past, but there can no guarantee that this trend will continue. To the extent any of our time charters expire during the typically weaker fiscal quarters ending December 31 and March 31, it may not be possible to re-charter our vessels at similar rates. As a result, we may have to accept lower rates or experience off-hire time for our vessels, which may adversely impact our business, financial condition and operating results.
Source: Dorian LPG
