Refinancing of Bank Debt
Maturities
GasLog Ltd. (“GasLog” or “the Company”) (NYSE:
GLOG) and GasLog Partners LP (“GasLog Partners” or the
“Partnership” and together with GasLog, the “Group”) (NYSE: GLOP)
are pleased to announce the signing of three new loan agreements,
The GasLog Ltd. $577M Facility, the GasLog Partners LP $260M
Facility and the GasLog Partners LP $200M Facility, which
substantially refinance all of the Group’s debt maturities due in
2021, strengthen the balance sheet and create additional liquidity
for the Group.
The key highlights of the transactions are as
follows:
- Refinances a total of approximately $1 billion of debt
outstanding across 12 vessels;
- Delivery of approximately $30 million of incremental liquidity
for the Group;
- Amortization profile of minimum 22-years and above with a
5-year tenor;
- Attractive weighted-average margin;
- Covenants in line with the Group’s existing bank credit
facilities and its NOK 2024 bond;
- Simplifies the Group’s bank debt into GasLog Ltd. and GasLog
Partners LP. facilities.
The three new credit facilities are signed and
expected to close by the end of July 2020. They fully refund the
$266 million due on the Five Vessel Refinancing credit facility and
refund the majority of the $724 million due on the Legacy Facility
Refinancing. GasLog is currently in documentation to refinance the
remaining balance of the Legacy Facility Refinancing, secured by
the GasLog Chelsea, later in the third quarter.
Citibank N.A., ABN Amro, and Nordea Bank AB
acted as Global Co-Coordinators and Bookrunners while HSBC plc.
acted as Mandated Lead Arranger; Credit Agricole Corporate and
Investment Bank acted as Lead Arranger; and UniCredit Bank and
National Australia Bank Limited acted as Arrangers for the
syndicate for the GLOG $577M Facility.
BNP Paribas and Credit Suisse AG acted as
Co-Coordinators and Bookrunners and Alpha Bank S.A. acted as
Arranger in the syndicate for the GLOP $260M Facility.
DNB ASA, London Branch and ING Bank N.V., London
Branch acted as Co-Coordinators and Bookrunners for the GLOP $200M
Facility.
Organizational Update
In November 2019, GasLog announced plans to
relocate more of its employees including several members of senior
management to Piraeus, Greece, home of our operational platform, in
order to enhance execution, efficiency and operational excellence
and to reduce overheads. Consequently, the headcount in our London
office has been reduced to 9 from 27, materially concluding the
organizational changes. The plan is expected to generate annualized
savings of approximately $6.0 million beginning in 2021.
Delivery of GasLog
Westminster
On July 15, GasLog took delivery of the GasLog
Westminster, a 180,000 cubic meter cargo capacity LNG carrier with
X-DF propulsion and Mark III Flex containment system. The vessel
was delivered on time and on budget and will immediately commence a
seven-year charter with a wholly owned subsidiary of Centrica
plc.
The GasLog Westminster is the third of seven
vessels scheduled to deliver during 2020-21, all of which are fully
funded and together are expected to generate approximately $145
million of EBITDA(1) per annum.
Peter G. Livanos, Chairman of GasLog, stated “I
am very pleased to announce the continued delivery of our in-built
growth, refinancing of our 2021 debt maturities a year ahead of
schedule and further reductions in our cost base, all strategic
priorities heading into 2020.
The GasLog Westminster provides industry leading
shipping economics and emissions reductions while expanding our
relationship with Centrica and enhancing our revenue and cash flow
visibility.
Signing our largest refinancing during
unprecedented uncertainty in credit and bank markets underscores
the strength and scale of our platform to attract new capital
providers. We appreciate the continued support from our banking
partners which we are proud to say include leading financial
institutions from around the world.”
(1) EBITDA is
a non-GAAP financial measure. Please refer to Exhibit I
for guidance on the underlying assumptions used to derive
EBITDA
Contacts:
Joseph Nelson Head of Investor Relations Phone: +1
212-223-0643
Email: ir@gaslogltd.com
About GasLog
GasLog is an international owner, operator and manager of LNG
carriers providing support to international energy companies as
part of their LNG logistics chain. GasLog’s consolidated fleet
consists of 35 LNG carriers. Of these vessels, 19 (15 on the water
and four on order) are owned by GasLog, one has been sold to a
subsidiary of Mitsui & Co., Ltd. and leased back to GasLog
under a long-term bareboat charter and the remaining 15 LNG
carriers are owned by the Company’s subsidiary, GasLog Partners.
GasLog’s principal executive offices are at 69 Akti Miaouli, 18537
Piraeus, Greece. Visit GasLog’s website at
http://www.gaslogltd.com.
About GasLog Partners
GasLog Partners is a growth-oriented master limited partnership
focused on owning, operating and acquiring LNG carriers under
multi-year charters. GasLog Partners’ fleet consists of 15 LNG
carriers with an average carrying capacity of approximately 158,000
cbm. GasLog Partners’ principal executive offices are located at 69
Akti Miaouli, 18537 Piraeus, Greece. Visit GasLog Partners’ website
at http://www.gaslogmlp.com.
Forward Looking Statements
All statements in this press release that are not statements of
historical fact are “forward-looking statements” within the meaning
of the U.S. Private Securities Litigation Reform Act of 1995.
Forward-looking statements include statements that address
activities, events or developments that the Company expects,
projects, believes or anticipates will or may occur in the future,
particularly in relation to our operations, cash flows, financial
position, liquidity and cash available for dividends or
distributions, plans, strategies, business prospects and changes
and trends in our business and the markets in which we operate. We
caution that these forward-looking statements represent our
estimates and assumptions only as of the date of this press
release, about factors that are beyond our ability to control or
predict, and are not intended to give any assurance as to future
results. Any of these factors or a combination of these factors
could materially affect future results of operations and the
ultimate accuracy of the forward-looking statements. Accordingly,
you should not unduly rely on any forward-looking statements.
Factors that might cause future results and outcomes to differ
include, but are not limited to, the following:
- general LNG shipping market conditions and trends, including
spot and multi-year charter rates, ship values, factors affecting
supply and demand of LNG and LNG shipping, including geopolitical
events, technological advancements and opportunities for the
profitable operations of LNG carriers;
- fluctuations in charter hire rates, vessel utilization and
vessel values;
- increased exposure to the spot market and fluctuations in spot
charter rates;
- our ability to maximize the use of our vessels, including the
re-deployment or disposition of vessels which are not under
multi-year charters, including the risk that certain of our vessels
may no longer have the latest technology at such time which may
impact our ability to secure employment for such vessels as well as
the rate at which we can charter such vessels;
- changes in our operating expenses, including crew wages,
maintenance, dry-docking and insurance costs and bunker
prices;
- number of off-hire days and dry-docking requirements including
our ability to complete scheduled dry-dockings on time and within
budget;
- planned capital expenditures and availability of capital
resources to fund capital expenditures;
- our ability to maintain long-term relationships and enter into
time charters with new and existing customers;
- disruptions to the LNG, LNG shipping and financial markets
caused by global shutdown as a result of the COVID-19
pandemic;
- fluctuations in prices for crude oil, petroleum products and
natural gas;
- changes in the ownership of our charterers;
- our customers’ performance of their obligations under our time
charters and other contracts;
- our future operating performance and expenses, financial
condition, liquidity and cash available for dividends and
distributions;
- our ability to obtain debt and equity financing on acceptable
terms to fund capital expenditures, acquisitions and other
corporate activities, funding by banks of their financial
commitments, and our ability to meet our restrictive covenants and
other obligations under our credit facilities;
- future, pending or recent acquisitions of or orders for ships
or other assets, business strategy, areas of possible expansion and
expected capital spending;
- the time that it may take to construct and deliver
newbuildings and the useful lives of our ships;
- fluctuations in currencies and interest rates;
- the expected cost of and our ability to comply with
environmental and regulatory conditions, including with respect to
emissions of air pollutants and greenhouse gases, as well as future
changes in such requirements or other actions taken by regulatory
authorities, governmental organizations, classification societies
and standards imposed by our charterers applicable to our
business;
- risks inherent in ship operation, including the discharge of
pollutants;
- the impact of environmental liabilities on us and the shipping
industry, including climate change;
- our ability to retain key employees and the availability of
skilled labor, ship crews and management;
- potential disruption of shipping routes due to accidents,
diseases, pandemics, political events, piracy or acts by
terrorists;
- potential liability from future litigation;
- any malfunction or disruption of information technology systems
and networks that our operations rely on or any impact of a
possible cybersecurity event; and
- other risks and uncertainties described in the Company’s Annual
Report on Form 20-F filed with the SEC on March 6, 2020 and
available at http://www.sec.gov.
We undertake no obligation to update or revise any
forward-looking statements contained in this press release, whether
as a result of new information, future events, a change in our
views or expectations or otherwise, except as required by
applicable law. New factors emerge from time to time, and it is not
possible for us to predict all of these factors. Further, we cannot
assess the impact of each such factor on our business or the extent
to which any factor, or combination of factors, may cause actual
results to be materially different from those contained in any
forward-looking statement.
EXHIBIT I
Non-GAAP Financial Measures
EBITDA
EBITDA is defined as earnings before depreciation,
amortization, financial income and costs, gain/loss on derivatives
and taxes. EBITDA is a non-GAAP financial measure that is used
as a supplemental financial measure by management and external
users of financial statements, such as investors, to assess our
financial and operating performance. We believe that this non-GAAP
financial measure assists our management and investors by
increasing the comparability of our performance from period to
period. We believe that including EBITDA assists our
management and investors in (i) understanding and analyzing the
results of our operating and business performance, (ii) selecting
between investing in us and other investment alternatives and (iii)
monitoring our ongoing financial and operational strength in
assessing whether to purchase and/or to continue to hold our common
shares. This is achieved by excluding the potentially disparate
effects between periods of financial costs, gain/loss on
derivatives, taxes, depreciation and amortization, which items are
affected by various and possibly changing financing methods,
financial market conditions, capital structure and historical cost
basis, and which items may significantly affect results of
operations between periods.
EBITDA has limitations as an analytical tool and should not be
considered as an alternative to, or as a substitute for, or
superior to, profit, profit from operations, earnings per share or
any other measure of operating performance presented in accordance
with International Financial Reporting Standards (“IFRS”). Some of
these limitations include the fact that it does not reflect (i) our
cash expenditures or future requirements for capital expenditures
or contractual commitments, (ii) changes in, or cash requirements
for, our working capital needs and (iii) the cash requirements
necessary to service interest or principal payments on our debt.
Although depreciation and amortization are non-cash charges, the
assets being depreciated and amortized will have to be replaced in
the future, and EBITDA does not reflect any cash
requirements for such replacements. EBITDA is not adjusted for
all non-cash income or expense items that are reflected in our
statements of cash flows and other companies in our industry may
calculate this measure differently than we do, limiting its
usefulness as a comparative measure.
For the Company’s seven newbuilds delivering in 2020 and 2021,
annualized EBITDA during the period in which all seven newbuilds
are operating under active charters is based on the following
assumptions:
- all seven newbuilds’ charters have commenced, and none have
expired or been terminated;
- delivery in 2020 and 2021, respectively, and timely receipt of
charter hire specified in the charter contracts;
- utilization of 363 days per year and no drydocking;
- vessel operating and supervision costs and charter commissions
per current internal estimates; and
- general and administrative expenses based on management’s
current internal estimates.
We consider the above assumptions to be reasonable as of July
16, 2020, but if these assumptions prove to be incorrect, actual
EBITDA for the entities owning the vessels could differ materially
from our estimates. The prospective financial information was not
prepared with a view toward public disclosure or with a view toward
complying with the guidelines established by the American Institute
of Certified Public Accountants, but, in the view of management,
was prepared on a reasonable basis and reflects the best currently
available estimates and judgments. However, this information is not
fact and should not be relied upon as being necessarily indicative
of future results, and readers of this document are cautioned not
to place undue reliance on the prospective financial information.
Neither our independent auditors nor any other independent
accountants have compiled, examined, or performed any procedures
with respect to the prospective financial information contained
above, nor have they expressed any opinion or any other form of
assurance on such information or its achievability and assume no
responsibility for, and disclaim any association with, such
prospective financial information.
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