Commercial Performance

Strategic Asset Management Sale of Four Vessels at US$114 Million, Generating US$28 Million of Free Cash and US$6 Million Book Gain

March 2018

The Company committed the 1993-built LGC BW Havis1 for recycling to a Ship Recycling Facility that is compliant with the IMO Hong Kong Convention of 2009 and completed the sale of the 2001-built VLGC BW Denise.

1 Sold in April 2018

July 2018

The Company completed a sale-and-leaseback of the 2005-built VLGC BW Empress.

December 2018

The Company committed the 1992-built LGC BW Helios2 for recycling to a Ship Recycling Facility that is compliant with the IMO Hong Kong Convention of 2009.

2 Sold in January 2019

No. of Global Delivered VLGCs


Total number of VLGCs delivered decreased by 60% from 25 vessels in 2017 to 10 vessels in 2018. The number of ships recycled increased from 2 vessels to 5 vessels from 2017 to 2018.

The divestment of these vessels were part of our strategy to rejuvenate our fleet. As a result of these sales, the average fleet age of BW LPG’s 100% owned vessels improved to 7 years against the global fleet average age of 9 years


Navigating Through The Cycle


US$522 million

TCE Income

US$301 million


US$104 million

Total Assets

US$2.3 billion



Net Loss after Tax

US$72.4 million

Baltic Index (US$ Per Day)

Shipping markets are cyclical

A review of the first 5 years of BW LPG as a publicly listed company:

2013 - 15

  • The first 2 years saw strong freight rates due to the massive expansion in US exports of LPG into an expanding market in the Far East. This period coincided with BW LPG’s newbuilding (NB) program on VLGCs. BW LPG worked with close clients to develop trades via contracts and time charters to enable new trade routes.

2016 - 17

  • Taking advantage of poor market conditions, BW LPG set about consolidating the market. A strong balance sheet, good commercial, operational and technical performance helped with the expansion of the fleet in 2017 (acquisition of Aurora LPG).
  • This period also saw the establishment of a joint venture in India and divestment of older VLGC and LGC units.
  • BW LPG opened offices in Houston and Oslo for 24x7 market coverage.


  • BW LPG continued its strong focus on reliablity and cost effectiveness.
  • Positioned a larger proportion of the fleet on the spot market to take advantage of improving freight economics.
  • Maximised shipping margins despite the trading environment.
  • Maintained utilisation rate above 88% and focused on cost efficiency.
  • Contracts concluded only at/above cash breakeven levels.
  • A further consolidation attempt in the LPG market was pursued in 2018 with the proposal to merge with Dorian LPG.
  • BW LPG leads the change in global shipping as the first to invest in LPG dual-fuel engine retrofitting, ahead of IMO 2020 environment regulation enforcement.

2018 in Six Graphs

  • VLGC spot rates in 2018 dampened in 1H 2018, and slightly recovered in 2H 2018. Overall, spot rate has increased YoY but is still below break-even levels.

    Source: Clarksons

    VLGC Spot Rates (US$ Per Day)

  • Propane price in 2018 dampened in Q4 2018. Average arbitrage from US to Asia settles at approximately US$60/ton for 2018.

    Source: Argus

    US and Far East Propane Price & Arbitrage via Panama Canal (US$ Per Ton)

  • Middle East and North America exports continue to grow, with total US Seaborne VLGC trade increased by 12.4%.

    Source: IHS Waterborne

    VLGC LPG Exports By Exporters (Million Metric Tons)

    VLGC LPG Exports By Exporters (Million Metric Tons)

  • China (5% YoY) and India (12% YoY) continue to be the key drivers of LPG import markets.

    Source: IHS Waterborne

    VLGC LPG Imports By Importers (Million Metric Tons)

    VLGC LPG Imports By Importers (Million Metric Tons)

  • Total of 10 ships were delivered as of 31 December 2018. Orderbook stands at 37 with expected deliveries from 2019 to 2020.

    Source: Clarksons,
    BW LPG Internal Analysis

    VLGC Fleet Development 2005 - 2020

    VLGC Fleet Development 2005 - 2020

  • Secondhand prices stabilised at cyclical low levels since 2017.

    Source: Clarksons

    Secondhand price for 5-year old VLGCs (US$ million)

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