Q2 FY2026
Filed Aug 28, 2026BW LPG reported Q2 2026 NPAT of US$138 million and profit attributable to equity holders of US$120 million, supported by strong shipping performance and a US$127 million realised trading gain.
The Company reported US$138 million of NPAT, US$120 million of profit attributable to equity holders, US$0.79 earnings per share and US$274.9 million of shipping TCE income. Q3 available fleet days were fixed at approximately 92% at approximately US$88,000 per day, while the Board declared a US$0.95 per share cash dividend equal to 100% of Shipping NPAT for Q2 2026.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net Profit After Tax (NPAT)other | US$138 million | – | – |
| Annualised return on equityother | 27% | – | – |
| Profit attributable to equity holders of the Companyother | US$120 million | – | – |
| Earnings per shareother | US$0.79 | – | – |
| TCE income – Shippingother | US$274.9 million | – | – |
| BW LPG India TCE incomeother | US$68.4 million | – | – |
| Shipping TCE income per available dayother | US$74,000 per available day | – | – |
| Shipping TCE income per calendar dayother | US$71,600 per calendar day | – | – |
| IFRS 15 negative adjustmentother | US$16.4 million | – | – |
| FFA negative adjustmentother | US$12.0 million | – | – |
| Product Services realised trading gainother | US$127 million | – | – |
| Product Services reported trading resultsother | a gross loss of US$18 million | – | – |
| Product Services reported loss after taxother | a loss after tax of US$31 million | – | – |
| Non-cash unrealised mark-to-market valuation change on open positionsother | negative US$145 million | – | – |
| Liquidityother | US$773 million | – | – |
| End-of-quarter net leverage ratioother | 23.5% | – | – |
Q3 2026 outlook
- NoteAvailable fleet days are fixed at 92% at an average rate of ~US$88,000 per day.
- NoteFixed time charter coverage is 41% at US$44,300 per day.
- NoteThe TCE guidance excludes potential IFRS 15 and FFA impact.
- NoteFor 2H 2026, the Company has secured 41% of the fleet capacity on fixed-rate time charters at US$44,100 per day.
- NoteFor 2H 2026, an additional 4% of fleet capacity is secured through FFA hedges at an average rate of US$48,000 per day.
- NoteThe Ras Tanura–Chiba Forward Freight Agreement market for the remainder of 2026 is currently indicating earnings slightly below US$180,000 per day.
Capital returns
- The Board declared a Q2 2026 cash dividend of US$0.95 per share.
- The cash dividend equals to 100% of Shipping NPAT for Q2 2026.
What drove it
- Shipping performance produced TCE income of US$274.9 million, with BW LPG India contributing TCE income of US$68.4 million.
- The Company cited robust time charter coverage and exposure to the strong spot market.
- Product Services generated a realised trading gain of US$127 million despite turbulent market conditions.
- US LPG exports carried by VLGCs increased by 16% during the first half of 2026, supported by additional export capacity and a shift in sourcing following the outbreak of war in the Middle East.
- US LPG exports to India rose 212% compared with the first half of 2025, while US exports to China for the first six months of 2026 increased 2% year-on-year.
- Panama Canal transit restrictions have resulted in more VLGCs sailing via the Cape of Good Hope, reducing the effective supply of vessels and supporting freight rates.
Concerns
- Reported Product Services trading results were a gross loss of US$18 million and a loss after tax of US$31 million, primarily due to a non-cash unrealised mark-to-market valuation change of negative US$145 million on open positions.
- Spot VLGC earnings are expected to remain highly sensitive to geopolitical developments and disruptions to global trading patterns.
- A full reopening of the Strait of Hormuz could narrow the US–Far East arbitrage and reduce overall ton-mile demand for VLGCs.
- Continued Panama Canal congestion and elevated transit costs cannot be ruled out for the remainder of the year.
- The orderbook currently stands at 155 VLGCs, equivalent to 35% of the existing fleet, with deliveries scheduled through the fourth quarter of 2030.
What to watch
- The conversion of Q3 available fleet days fixed at 92% at an average rate of ~US$88,000 per day, with guidance excluding potential IFRS 15 and FFA impact.
- The timing of delivery of BW Birch and BW Levant, both expected by mid-November.
- The 2016-built LPG dual-fuel retrofit vessel fixed for a five-year time charter out agreement in the mid-high US$40,000s per day with delivery end 2026.
- The recovery of Middle East LPG exports, which is expected to take 12-36 months depending on local conditions and infrastructure damage severity if conflict resolution occurs in Q3 2026.
- VLGC deliveries, with 27 VLGCs delivered during 2026 and a further 13 vessels expected by year-end.
- China PDH operating rates, which have recovered to levels above 70%.
Balance sheet and cash flow
- The Company reported ample liquidity of US$773 million.
- The end-of-quarter net leverage ratio was 23.5%, compared to 26.3% as of 31 March 2026.
- The sale of BW Elm is expected to generate net cash proceeds of approximately US$64 million.
- The sale of BW Birch is expected to generate net cash proceeds of approximately US$64 million.
- The sale of BW Levant is expected to generate net cash proceeds of approximately US$38 million.
Analysis
BW LPG reported Q2 2026 NPAT of US$138 million, profit attributable to equity holders of US$120 million and earnings per share of US$0.79. The Company attributed the result to strong shipping performance. Shipping TCE income was US$274.9 million, including US$68.4 million from the BW LPG India subsidiary. TCE income concluded at US$74,000 per available day and US$71,600 per calendar day after IFRS 15 and FFA negative adjustments of US$16.4 million and US$12.0 million, respectively.
Product Services added a US$127 million realised trading gain, which the Company said reflected effective risk management despite turbulent markets. The reported result was nevertheless a gross loss of US$18 million and a loss after tax of US$31 million because of a non-cash unrealised mark-to-market valuation change of negative US$145 million on open positions. This distinction between realised trading performance and the reported mark-to-market outcome is central to the quarter's earnings composition.
The balance-sheet disclosures point to ample liquidity of US$773 million and an end-of-quarter net leverage ratio of 23.5%, compared with 26.3% as of 31 March 2026. The Company declared a Q2 2026 cash dividend of US$0.95 per share, representing 100% of Shipping NPAT for Q2 2026. Subsequent vessel sales are expected to add net cash proceeds of approximately US$64 million for each of BW Elm and BW Birch, and approximately US$38 million for BW Levant.
Forward shipping coverage is elevated. For Q3, approximately 92% of available fleet days are fixed at approximately US$88,000 per day, including fixed time charter coverage of 41% at US$44,300 per day, although the guidance excludes potential IFRS 15 and FFA impact. For 2H 2026, 41% of fleet capacity is secured on fixed-rate time charters at US$44,100 per day and an additional 4% through FFA hedges at US$48,000 per day.
The market backdrop remains volatile. The Company described stronger spot VLGC rates alongside a widening US–Far East LPG arbitrage and longer voyages caused by Panama Canal restrictions. It also highlighted risks that a reopening of the Strait of Hormuz could increase Middle East export volumes while narrowing the arbitrage and reducing ton-mile demand. Fleet supply remains an important medium-term issue, with an orderbook of 155 VLGCs, equivalent to 35% of the existing fleet.
Not in the filing
stated, not guessed- Period end date was not reported in the filing text.
- Total revenue was not reported.
- Segment revenue was not reported.
- Gross profit and gross margin were not reported.
- Operating income and operating margin were not reported.
- GAAP and non-GAAP classifications for NPAT, profit attributable to equity holders, earnings per share, TCE income and Product Services results were not explicitly reported.
- Prior-year and prior-quarter amounts and percentage changes for reported earnings, TCE, Product Services and liquidity metrics were not reported.
- Operating cash flow was not reported.
- Free cash flow was not reported.
- Cash balance and debt balance were not separately reported.
- Share repurchases were not reported.
- Forward revenue, gross-margin, operating-expense and tax-rate guidance were not reported.
- Prior-period outlook was not provided.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.