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Assessing GasLog Partners' 3Q16: What Does the Future Hold?

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Part 7
Assessing GasLog Partners' 3Q16: What Does the Future Hold? PART 7 OF 8

How Was GasLog Partners’ Financial Health at the End of 3Q16?

Capital intensive industry

The LNG (liquefied natural gas) carrier industry is a capital-intensive industry. It’s important to look at GasLog Partners’ (GLOP) leverage.

How Was GasLog Partners&#8217; Financial Health at the End of 3Q16?

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Equity offering

In August 2016, GasLog Partners completed a common equity offering, raising total net proceeds of $53.4 million.

Debt

GasLog Partners has continued its strategy of utilizing excess cash flow to reduce debt. Over the past 12 months, GasLog Partners has reduced its total borrowings by 10%. Since 3Q15, the company has repaid ~$70 million worth of its debt. GLOP’s total debt at the end of 3Q16 was $702 million, down from $771 million in 3Q15 and $717 million in 2Q16. Its total debt-to-total capitalization was 51% in 3Q16, down from 56% in 3Q15.

Liquidity

At the end of 3Q16, GasLog Partners had ~$140 million of total available liquidity. The rise over the previous quarter was mainly due to the recent equity offering and the full payment of the company’s revolving credit facility.

GLOP has current assets of ~$117 million and current liabilities of ~$65 million, resulting in a positive working capital position of ~$52 million. The partnership’s current ratio, which is calculated as its current assets over its current liabilities, is 1.8x.

GLOP’s peers haven’t yet released their 3Q16 earnings, but at the end of 2Q16, Golar LNG (GLNG), GasLog (GLOG), Golar LNG Partners (GMLP), Höegh LNG Partners (HMLP) all had current ratios of less than 1.

Investors interested in broad exposure to industrials stocks can invest in the SPDR Dow Jones Industrial Average ETF (DIA).

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