This article first appeared on GuruFocus .
Release Date: August 06, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Adjusted EBITDA of $120 million in Q2 2026, up 12% year-over-year, driven by a full quarter contribution from the Jamaica platform.
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Raised and narrowed full-year 2026 adjusted EBITDA guidance to $490-$515 million, reflecting strong contracted base business and asset optimization.
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Signed a nine-month charter with Jordan's NEPCO for the Acadia FSRU, contributing approximately $20 million of EBITDA in 2026.
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Secured a seven-year charter with Frontera Energy for the Express FSRU in Colombia, expected to increase its annual EBITDA contribution by about 35%.
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Strong balance sheet with $342 million cash, $500 million revolver capacity, and net leverage of 1.9x, providing ample liquidity for growth.
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Increased quarterly dividend by 13% to $0.09 per share, consistent with a low double-digit annual growth target through 2028.
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Progressing on Iraq LNG import terminal, with operations expected to commence in Q2 2027, under a take-or-pay contracted structure.
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Acquired the Methane Patricia Camilla LNG carrier for $79 million, a high-specification vessel ideal for FSRU conversion, enhancing future growth potential.
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Expanding Caribbean platform with first LNG sales to other islands, leveraging Jamaica as a hub for regional growth.
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Strong recontracting environment, with the Express deal marking the fifth asset recontracted on more favorable terms in 4.5 years.
Negative Points
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Adjusted EBITDA in Q2 2026 was down slightly versus the prior quarter, indicating some sequential softening.
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Committed growth capital guidance raised to $380-$400 million, driven by Iraq-related costs pulled forward and FSRU conversion payments, increasing near-term cash outflows.
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Ongoing Middle East conflict poses risks to Iraq project execution, though the company remains confident in its Q2 2027 timeline.
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FSRU conversion project CapEx is expected to be higher than the previously communicated $200 million, potentially impacting returns.
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Maintenance CapEx guidance lowered to $85-$95 million due to deferral of the Express drydock into 2027, which could create operational risks.
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The Atlantic Basin deal's timing remains a variable, with potential to push results to the lower end of guidance if cargoes slip into Q1 2027.
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The company's pivot to integrated projects may limit opportunities for traditional FSRU charters, potentially reducing flexibility in a tight market.
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The Iraq project's start-up is subject to security conditions, and any escalation could delay operations beyond Q2 2027.
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The company's focus on being 'boring' and matching supply to demand may limit upside from commodity price movements.
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The Express's redeployment to Colombia is contingent on completing its current charter and drydock, with any delays impacting the 2027 start.
Q & A Highlights
Q: With the Express's strong recontracting results, how should we think about the read-throughs to the rest of your portfolio? Does this outcome change your expectations around pricing, contract duration, or renewal terms? A: Steven Kobos, President and CEO, stated that the company remains bullish on the asset class, noting it will remain tight through the foreseeable future. He highlighted that this is the fifth asset in the existing fleet recontracted on more favorable terms over the past 4.5 years, and expects this trend to continue into the 2030s as the coming LNG supply wave will need homes, but there are insufficient numbers of them.
Q: Can you walk us through the assumptions embedded in the newly increased guidance, what factors could push results towards the high or low end, and what gives you confidence in starting Iraq terminal operations in Q2 2027 given the Middle East situation? A: Dana Armstrong, CFO, explained that the base business is predictable, with the biggest variable being the Atlantic Basin deal and cargo delivery timing, which could swing results within the range. David Liner, COO, added that the Iraq project fundamentals are even more compelling now than before the conflict, with personnel on the ground continuously, strong relationships with local governments and security forces, giving confidence to restart in earnest and come online in Q2 2027.
Q: Can you walk us through the rationale for buying the new donor vessel (Methane Patricia Camilla) for the FSRU conversion, and what makes this asset more attractive than the existing Shenandoah LNG carrier? A: Steven Kobos, President and CEO, described the vessel as among the best conversion candidates in the world, citing its 170,000 cubic meter storage capacity, TFDE power generation, and installed re-liquefaction, which reduces execution risk and makes it ideal for integrated deals. David Liner, COO, added that the vessel's size allows for efficient operations with standard parcels, and its pedigree of world-class owners and operators, confirmed by on-the-ground inspections, provides comfort in the asset's condition.
Q: How would you describe demand for full-service terminal plus LNG supply and last-mile solutions versus standalone FSRU charters, and how does the margin profile vary between them? A: Steven Kobos, President and CEO, stated the company wants to be as involved as possible and embedded within deals, noting that while they won't turn down great traditional charter opportunities, they are moving toward integration as the future of regas. Dana Armstrong, CFO, clarified that more integrated projects drive higher returns, with unlevered after-tax returns ranging from low double-digits to mid-teens, where TCPs are closer to the lower end and integrated projects closer to mid-teens or higher.
Q: It's been over a year since closing on the Jamaica platform. Can you talk about the learnings from owning that platform and when we may start to see chunkier growth opportunities materialize? A: Oliver Simpson, Chief Commercial Officer, noted the integration has gone extremely well, with the company making its first sales with final destinations outside Jamaica this quarter. He highlighted the Colombia TCP as an extension of the Caribbean portfolio, and stated there are a number of active discussions ongoing, with expectations to provide more news through the course of the year, while maintaining the previously provided EBITDA and CapEx range for the Caribbean outlook.
Q: What kind of conversations are you having regarding LNG supply from the Middle East, specifically Qatar, and how does the Express fit into the dry dock before the charter in Colombia? A: Steven Kobos, President and CEO, noted the conflict has underscored the need for the Iraqi terminal, citing that Kuwait's LNG terminal cargoes were only down 15% in 2025 with 39 of 40 cargoes delivered from Qatar, showing intra-basin deliveries are proceeding. Regarding the Express, he confirmed it remains Plan A for Colombia, but the company always has Plan B and C options ready if needed, demonstrating their flexibility in execution.
Q: How might the Express being redeployed in Colombia play a role in your broader plans for growth in the Caribbean? A: Oliver Simpson, Chief Commercial Officer, explained that the Colombia asset, located near one of the largest ports in Colombia and the broader Caribbean, can be used in conjunction with the Jamaica platform to reach new customers. He emphasized that while the focus is on getting the terminal up and running, the long-term charter and relationship with Frontera provides a stepping stone to leverage the asset for further growth across the Caribbean.
Q: What signals would push you back to getting in the queue of a shipbuilder for a new build FSRU? A: Steven Kobos, President and CEO, acknowledged the company is always looking at new assets, praising the Acadia as a "beast" and expressing love for the Patricia Camilla. He stated that while they are not on the verge of pulling the trigger on a new build anytime soon, he fully expects the company to return to new builds at some point in the 2030s, noting shipyards would need to sweeten their offers first.
Q: Can you give us a sense of the EBITDA uplift you anticipate in 2028 from the FSRU conversion? A: Dana Armstrong, CFO, guided that the company generally uses a CapEx to EBITDA multiple of five to seven times. She noted that Iraq is around five times as an integrated project, and the conversion could potentially be a TCP, so it will most likely fall somewhere in that five to seven times range depending on the final project structure.
Q: Given the state of the world today, have your conversations with potential customers changed in terms of how integrated opportunities will look, including more robust storage capacity designs? A: Steven Kobos, President and CEO, shared an anecdote about being on the USS Nimitz in Kingston, bragging to the Jamaican government about their stable natural gas prices due to reliable long-term Henry Hub index pricing. He emphasized that the lesson from current events is to be careful about sourcing and contracting, and that the company wants to be "boring" by buying and selling on the same index, which has made customers more receptive to the integrated product they offer.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
