GOLAR LNG Below Q2 consensus
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GOLAR LNG Below Q2 consensus We are below Q2 consensus, we believe owing to FLNG Hilli accounting (results due at 13:00 CET on 31 August). The key challenge is greater certainty about FID dates in Africa, as Golar LNG had guided for a BP FLNG FID by end-2018. This looks to be the next catalyst along with a continued LNG shipping market recovery and FLNG Hilli vessel utilisation rising to 100%, which we believe is fair to assume at a gas price of USD10/mnBtu and an oil price of USD75/bbl. We reiterate our BUY and USD39 target price.
Estimate changes owing to sale of one train of FLNG Hilli. We have raised our 2018e EBITDA by 12% while our 2019–2020 EBITDA forecasts are unchanged. We have cut our net profit attributable to Golar LNG by 24% for 2018e, 90% for 2019e, and 23% for 2020e, as we have raised our Q3e LNG spot rate on stronger than expected rates and have adjusted for the sale of one train of FLNG Hilli to Golar LNG Partners.
Below Q2 consensus, due to FLNG Hilli accounting. We forecast Q2 EBITDA of USD5.2m (consensus USD25.8m) and net profit attributable to Golar LNG of USD36m (consensus USD-19.8m). We assume spot timecharter rates of USD22,000/day and earnings on FLNG Hilli since 4 June (from acceptance) with adjustments under non-controlling interest for the 50% of net profit attributable to Golar LNG Partners.
Winter looking increasingly promising. In our September 2017 sector report, we said an increasing share of US exports to Asia would increase tonne-miles. While playing out as we expected, our 2018 expectations were too conservative as solid freight rate momentum was driven by stronger than expected exports from the US and Russia. Due to our Q3 USD46k/day TFDE spot rate undershooting actual rates, we have raised it to USD70k/day. Our winter average (Q4 2018–Q1 2019) spot estimate of USD61k/day looks conservative to us, as we expect growing demand as we approach the winter.
BUY and USD39 target price reiterated, based on 1.0x our one-year forward SOTP of USD39. Our current SOTP is USD17.4 and our target price includes USD10 from FLNG Hilli utilisation rising from 50% to 100% and USD12 for FLNG no.2 with BP.
GOLAR LNG Below Q2 consensus We are below Q2 consensus, we believe owing to FLNG Hilli accounting (results due at 13:00 CET on 31 August). The key challenge is greater certainty about FID dates in Africa, as Golar LNG had guided for a BP FLNG FID by end-2018. This looks to be the next catalyst along with a continued LNG shipping market recovery and FLNG Hilli vessel utilisation rising to 100%, which we believe is fair to assume at a gas price of USD10/mnBtu and an oil price of USD75/bbl. We reiterate our BUY and USD39 target price.
Estimate changes owing to sale of one train of FLNG Hilli. We have raised our 2018e EBITDA by 12% while our 2019–2020 EBITDA forecasts are unchanged. We have cut our net profit attributable to Golar LNG by 24% for 2018e, 90% for 2019e, and 23% for 2020e, as we have raised our Q3e LNG spot rate on stronger than expected rates and have adjusted for the sale of one train of FLNG Hilli to Golar LNG Partners.
Below Q2 consensus, due to FLNG Hilli accounting. We forecast Q2 EBITDA of USD5.2m (consensus USD25.8m) and net profit attributable to Golar LNG of USD36m (consensus USD-19.8m). We assume spot timecharter rates of USD22,000/day and earnings on FLNG Hilli since 4 June (from acceptance) with adjustments under non-controlling interest for the 50% of net profit attributable to Golar LNG Partners.
Winter looking increasingly promising. In our September 2017 sector report, we said an increasing share of US exports to Asia would increase tonne-miles. While playing out as we expected, our 2018 expectations were too conservative as solid freight rate momentum was driven by stronger than expected exports from the US and Russia. Due to our Q3 USD46k/day TFDE spot rate undershooting actual rates, we have raised it to USD70k/day. Our winter average (Q4 2018–Q1 2019) spot estimate of USD61k/day looks conservative to us, as we expect growing demand as we approach the winter.
BUY and USD39 target price reiterated, based on 1.0x our one-year forward SOTP of USD39. Our current SOTP is USD17.4 and our target price includes USD10 from FLNG Hilli utilisation rising from 50% to 100% and USD12 for FLNG no.2 with BP.