Document and Entity Information
Document and Entity Information | 6 Months Ended |
Jun. 30, 2018shares | |
Document Information | |
Document Type | 6-K |
Document Period End Date | Jun. 30, 2018 |
Amendment Flag | false |
Entity Registrant Name | Dynagas LNG Partners LP |
Entity Central Index Key | 1,578,453 |
Trading Symbol | DLNG |
Entity Current Reporting Status | Yes |
Entity Voluntary Filers | No |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Accelerated Filer |
Entity Well-known Seasoned Issuer | No |
Document Fiscal Year Focus | 2,018 |
Document Fiscal Period Focus | Q2 |
Common Limited Partner | |
Document Information | |
Entity's units outstanding | 35,490,000 |
Preferred Limited Partner | |
Document Information | |
Entity's units outstanding | 3,000,000 |
General Partner | |
Document Information | |
Entity's units outstanding | 35,526 |
Consolidated Condensed Balance
Consolidated Condensed Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 57,818 | $ 67,464 |
Trade receivables | 62 | 155 |
Prepayments and other assets | 1,607 | 1,103 |
Inventories | 3,868 | 799 |
Due from related party | 2,348 | 883 |
Total current assets | 65,703 | 70,404 |
FIXED ASSETS, NET: | ||
Vessels, net | 962,668 | 977,298 |
Total fixed assets, net | 962,668 | 977,298 |
OTHER NON CURRENT ASSETS: | ||
Due from related party | 1,350 | 1,350 |
Deferred charges | 812 | 0 |
Above-market acquired time charter contract | 1,673 | 5,267 |
Total assets | 1,032,206 | 1,054,319 |
CURRENT LIABILITIES: | ||
Current portion of long-term debt, net of unamortized deferred financing fees of $2,129 and $2,145, respectively | 2,671 | 2,655 |
Trade payables | 9,058 | 4,497 |
Due to related party | 80 | 72 |
Accrued liabilities | 4,712 | 4,051 |
Unearned revenue | 6,867 | 11,623 |
Total current liabilities | 23,388 | 22,898 |
NON-CURRENT LIABILITIES: | ||
Deferred revenue | 1,682 | 1,405 |
Long-term debt, net of current portion and unamortized deferred financing fees of $9,490 and $11,102, respectively | 710,910 | 711,698 |
Total non-current liabilities | 712,592 | 713,103 |
Commitments and contingencies | 0 | 0 |
PARTNERS' EQUITY: | ||
Common unitholders (unlimited authorized; 35,490,000 units issued and outstanding as at June 30, 2018 and December 31, 2017) | 223,002 | 245,055 |
Preferred unitholders (3,450,000 authorized; 3,000,000 Series A Preferred Units issued and outstanding as at June 30, 2018 and December 31, 2017) | 73,216 | 73,216 |
General Partner (35,526 units issued and outstanding as at June 30, 2018 and December 31, 2017) | 8 | 47 |
Total partners' equity | 296,226 | 318,318 |
Total liabilities and partners' equity | $ 1,032,206 | $ 1,054,319 |
Consolidated Condensed Balance3
Consolidated Condensed Balance Sheets (Parentheticals) (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Statement Of Financial Position | ||
Deferred finance fees, current portion | $ 2,129 | $ 2,145 |
Deferred finance fees, non-current portion | $ 9,490 | $ 11,102 |
Common unitholders - units issued | 35,490,000 | 35,490,000 |
Common unitholders - units outstanding | 35,490,000 | 35,490,000 |
Series A Preferred Units authorized | 3,450,000 | 3,450,000 |
Series A Preferred Units issued | 3,000,000 | 3,000,000 |
Series A Preferred Units outstanding | 3,000,000 | 3,000,000 |
General Partner unitholders - units issued | 35,526 | 35,526 |
General Partner unitholders - units outstanding | 35,526 | 35,526 |
Unaudited Interim Condensed Con
Unaudited Interim Condensed Consolidated Statements of Income - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
REVENUES: | ||
Voyage revenues | $ 64,796 | $ 71,067 |
EXPENSES: | ||
Voyage expenses (including related party) | (1,243) | (2,217) |
Vessel operating expenses | (12,241) | (14,161) |
Dry-docking and special survey costs | (2,696) | (5,131) |
General and administrative expenses (including related party) | (1,062) | (840) |
Management fees-related party | (3,147) | (3,056) |
Depreciation | (15,039) | (15,035) |
Operating income | 29,368 | 30,627 |
OTHER INCOME/(EXPENSES): | ||
Interest and finance costs | (24,626) | (22,618) |
Interest income | 390 | 3 |
Other, net | 59 | (281) |
Total other expenses | (24,177) | (22,896) |
Partnership's Net Income | 5,191 | 7,731 |
Common unitholders' interest in Net Income | 1,814 | 3,110 |
Preferred unitholders' interest in Net Income | 3,375 | 3,375 |
Subordinated unitholders' interest in Net Income | 0 | 1,208 |
General Partner's interest in Net Income | $ 2 | $ 38 |
Earnings per unit, basic and diluted: | ||
Common unit (basic and diluted) | $ 0.05 | $ 0.09 |
Weighted average number of units outstanding, basic and diluted: | ||
Common units | 35,490,000 | 33,585,829 |
Unaudited Interim Consolidated
Unaudited Interim Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Cash flows from Operating Activities: | ||
Net income: | $ 5,191 | $ 7,731 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation | 15,039 | 15,035 |
Amortization and write-off of deferred financing fees | 1,625 | 3,723 |
Deferred revenue amortization | 277 | 86 |
Amortization of fair value of acquired time charter | 3,594 | 3,594 |
Changes in operating assets and liabilities: | ||
Trade receivables | 93 | (196) |
Prepayments and other assets | (504) | (878) |
Inventories | (3,069) | 63 |
Due from/to related party | (1,457) | 37 |
Trade payables | 4,610 | 6,074 |
Deferred charges | (812) | 0 |
Accrued liabilities | 663 | 1,690 |
Unearned revenue | (4,756) | (7,391) |
Net cash provided by Operating Activities | 20,494 | 29,568 |
Cash flows from Investing Activities: | ||
Vessel acquisitions and other additions to vessels' cost | (409) | 0 |
Net cash used in Investing Activities | (409) | 0 |
Cash flows from Financing Activities: | ||
Payment of securities registration and other filing costs | (48) | 0 |
Distributions declared and paid | (27,283) | (33,429) |
Proceeds from long-term debt | 0 | 480,000 |
Repayment of long-term debt | (2,400) | (472,500) |
Payment of deferred finance fees | 0 | (11,923) |
Net cash used in Financing Activities | (29,731) | (37,852) |
Net decrease in cash and cash equivalents and restricted cash | (9,646) | (8,284) |
Cash and cash equivalents and restricted cash at beginning of the period | 67,464 | 82,595 |
Cash and cash equivalents and restricted cash at end of the period | 57,818 | 74,311 |
RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH | ||
Cash and cash equivalents | 57,818 | 74,311 |
Restricted cash | 0 | 0 |
Cash and cash equivalents and restricted cash at end of the period | $ 57,818 | $ 74,311 |
Partnership Formation and Gener
Partnership Formation and General Information: | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements | |
Partnership Formation and General Information: | 1. Partnership Formation and General Information: Dynagas LNG Partners LP (“Dynagas Partners” or the “Partnership”) was incorporated as a limited Partnership on May 30, 2013, under the laws of the Republic of the Marshall Islands. On November 18 2013, the Partnership successfully completed its initial public offering (the “IPO”) pursuant to which, (i) the Partnership offered and sold 8,250,000 common units to the public at $18.00 per common unit, and in connection with the closing of the IPO, and (ii) the Partnership’s Sponsor, Dynagas Holding Ltd., a company beneficially wholly owned by Mr. George Prokopiou, the Partnership’s Chairman and major unitholder and certain of his close family members, offered and sold 4,250,000 common units to the public at $18.00 per common unit. In connection with the IPO, the Partnership entered into certain agreements including: (a) an omnibus agreement with the Sponsor, which was subsequently amended on April 12, 2016 (the “Omnibus Agreement”), which provides the Partnership the right to purchase certain identified liquefied natural gas (“LNG”) carrier vessels at a purchase price to be determined pursuant to the terms and conditions contained therein (Note 3(c)) and, (b) a $30 million revolving credit facility with the Sponsor to be used for general Partnership purposes. The Partnership is engaged in the seaborne transportation industry through the ownership and operation of high specification LNG vessels and is the sole owner (directly or indirectly) of all outstanding shares or units of the following subsidiaries as of June 30, 2018: Vessel Owning Subsidiaries: Company Name Country of incorporation Vessel Name Delivery Date from shipyard Delivery date to Partnership Cbm Capacity Pegasus Shipholding S.A. (“Pegasus”) Marshall Islands Clean Energy March 2007 n/a 149,700 Lance Shipping S.A. (“Lance”) Marshall Islands Ob River July 2007 n/a 149,700 Seacrown Maritime Ltd. (“Seacrown”) Marshall Islands Amur River January 2008 n/a 149,700 Fareastern Shipping Limited (“Fareastern”) Malta Arctic Aurora July 2013 June 2014 155,000 Navajo Marine Limited (“Navajo”) Marshall Islands Yenisei River July 2013 September 2014 155,000 Solana Holding Ltd. (“Solana”) Marshall Islands Lena River October 2013 December 2015 155,000 Non-Vessel Owning Subsidiaries: Company Name Country of incorporation Purpose of incorporation Dynagas Equity Holding Limited (“Dynagas Equity”) Liberia Holding company that owns all of the outstanding share capital of Arctic LNG Carriers Ltd. (“Arctic LNG”). Dynagas Operating GP LLC (“Dynagas Operating GP”) Marshall Islands Limited Liability Company in which the Partnership holds a 100% membership interest and which has 100% of the Non-Economic General Partner Interest in Dynagas Operating LP. Dynagas Operating LP (“Dynagas Operating”) Marshall Islands Limited partnership in which the Partnership holds a 100% limited partnership interest and which owns 100% of the issued and outstanding share capital of Dynagas Equity. Dynagas Finance Inc. Marshall Islands Wholly owned subsidiary of the Partnership whose activities are limited to co-issuing the Senior Unsecured Notes discussed under Note 5 and engaging in other activities incidental thereto. Arctic LNG Marshall Islands Wholly owned subsidiary of the Partnership which is directly wholly owned by Dynagas Equity and which owns all of the issued and outstanding share capital of Pegasus, Lance, Seacrown, Fareastern, Navajo, Solana and Dynagas Finance LLC. Dynagas Finance LLC Delaware Wholly owned subsidiary of Arctic LNG and co-borrower of the Term Loan B discussed under Note 5. Since the Partnership’s inception, the technical, administrative and commercial management of the Partnership’s fleet is performed by Dynagas Ltd. (“Dynagas” or the “Manager”), a related company, wholly owned by the Partnership’s Chairman (Note 3(a)). As of June 30, 2018, the Partnership’s Sponsor owned 44.0% of the outstanding equity interests in the Partnership (excluding the Series A Preferred Units, which, generally, have no voting rights), including the 0.1% general partner interest retained by it, as the general partner, Dynagas GP LLC, is owned and controlled by the Sponsor. The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with Generally Accepted Accounting Principles in the United States of America ("U.S. GAAP") and applicable rules and regulations of the Securities and Exchange Commission (or “SEC”) for interim financial reporting. The unaudited interim condensed consolidated financial statements include the accounts of Dynagas Partners and its wholly-owned subsidiaries, referred to above. All intercompany balances and transactions have been eliminated upon consolidation. These unaudited interim condensed consolidated financial statements and accompanying notes should be read in conjunction with the Partnership’s audited consolidated financial statements for the year ended December 31, 2017 and notes thereto included in its Annual Report on Form 20-F, filed with the SEC on March 9, 2018. In the opinion of the Partnership’s management, all adjustments, which include only normal recurring adjustments, necessary for a fair presentation of the financial position, operating results and cash flows have been included in the financial statements for the periods presented. Interim results are not necessarily indicative of the results that may be expected for the year ending December 31, 2018. |
Significant Accounting Policies
Significant Accounting Policies and Recent Accounting Pronouncements: | 6 Months Ended |
Jun. 30, 2018 | |
Significant Accounting Policies and Recent Accounting Pronouncements | |
Significant Accounting Policies and Recent Accounting Pronouncements: | 2. Significant Accounting Policies and Recent Accounting Pronouncements: A summary of the Partnership’s significant accounting policies can be found in the Partnership’s consolidated financial statements included in the Annual Report on Form 20-F for the year ended December 31, 2017, filed with the Securities and Exchange Commission on March 9, 2018. There have been no material changes to these policies in the six month period ended June 30, 2018. During the six month periods ended June 30, 2018 and 2017, charterers that individually accounted for more than 10% of the Partnership’s revenues were as follows: Charterer 2018 2017 A 75 % 70 % B 19 % 19 % C - % 11 % Total 94 % 100 % During the six months ended June 30, 2018, the Partnership adopted the following standards/ standards updates: i) Accounting Standards Update (ASU) 2014-09 (Topic 606): In May 2016, the FASB issued the final standard on revenue from contracts with customers. The standard, which was issued as ASU 2014-09 (Topic 606) by the FASB, and as amended, outlines a single comprehensive model for entities to use in accounting for revenue from contracts with customers and supersedes most legacy revenue recognition guidance. The core principle of the guidance in Topic 606 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services by applying the following steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in each contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in each contract; and (5) recognize revenue when (or as) the entity satisfies a performance obligation. The standard is effective for public business entities from annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. The new revenue standard may be applied using either of the following transition methods: (1) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (2) a modified retrospective approach with the cumulative effect of initially adopting the standard recognized at the date of adoption (which includes additional footnote disclosures). The adoption of this standard primarily changes the method of recognizing revenue for voyage charters from the discharge-to-discharge method to the loading-to-discharge method. Under the discharge-to-discharge method, revenue was recognized from the discharge of the prior voyage, or contract date of the current voyage if later, until the discharge of the current voyage. Under the load-to-discharge method, revenue is recognized from the load of a voyage until its discharge. The Partnership neither currently operates nor has historically operated any of its fleet vessels under voyage charters and in this respect, the Partnership’s revenue is primarily derived from time charters and accounted for under ASC 840 Leases. The Partnership adopted the provisions of ASC 606 on January 1, 2018 and elected to use the modified retrospective approach as an application transition method. The Partnership’s quantitative assessment of the effects of the adoption of this new guidance indicated that the financial impact of applying the new revenue recognition standard as outlined above did not have any effect to the opening retained earnings of the Partnership as of January 1, 2018. ii) ASU 2016-01, Financial Instruments- Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The amendments in this update (the “Update”) affect all entities that hold financial assets or owe financial liabilities and address certain aspects of recognition, measurement, presentation and disclosure of financial instruments. This new standard was adopted on January 1, 2018 and had no impact on the Partnership’s consolidated financial statements and notes disclosures. iii) ASU No. 2016-15- Statement of Cash Flows Classification of Certain Cash Receipts. This Update addresses eight specific cash flow issues and provides specific guidance in how certain cash receipts and cash payments should be presented and classified in the statement of cash flows under Topic 230 with the objective of reducing the current and potential future diversity in practice. ASU No. 2016-15 was adopted as of January 1, 2018 and its adoption did not result in any changes in the classification of cash receipts and cash payments in the Partnership’s reported statements of cash flows. iv) ASU No. 2016-18—Statement of Cash Flows – Restricted Cash. The amendments in this Update require that a statement of cash flows explains the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Partnership early adopted ASU No. 2016-18 as of April 1, 2018. The amendments in this update should be applied using a retrospective transition method to each period presented. As a result, an amount of $25,000 of non-current restricted cash has been aggregated with the $57,595 cash and cash equivalents in the beginning of period line item on the comparative statement of cash flows for the six months ended June 30, 2017. v) ASU 2017-01 — Business Combinations, Clarifying the Definition of a business. The amendments is this update were issued in order to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisition (or disposals) of assets or businesses. This ASU provides a screen to determine when a set of assets and activities does not constitute a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. The implementation of this standards update as of January 1, 2018, had no impact on the Partnership’s consolidated financial statements. Recent Accounting Pronouncements: ASU 2016-02: In February 2016, the FASB issued ASU No. 2016-02, Leases (ASC 842), and as amended, which requires lessees to recognize most leases on the balance sheet. This is expected to increase both reported assets and liabilities. The new lease standard does not substantially change lessor accounting. For public companies, the standard will be effective for the first interim reporting period within annual periods beginning after December 15, 2018, although early adoption is permitted. Lessees and lessors will be required to apply the new standard at the beginning of the earliest period presented in the financial statements in which they first apply the new guidance, using a modified retrospective transition method. In July 2018, the FASB issued ASU No. 2018-11, Leases (ASC 842) – Targeted Improvements. The amendments in this Update: (i) provide entities with an additional (and optional) transition method to adopt the new leases standard, under which an entity initially applies the new leases standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption consistent with preparers' requests and (ii) provide lessors with a practical expedient, by class of underlying asset, to not separate non-lease components from the associated lease component and, instead, to account for those components as a single component if the non-lease components otherwise would be accounted for under the new revenue guidance (Topic 606) and both of the following are met: (a) the timing and pattern of transfer of the non-lease component(s) and associated lease component are the same and (b) the lease component, if accounted for separately, would be classified as an operating lease. If the non-lease component or components associated with the lease component are the predominant component of the combined component, an entity is required to account for the combined component in accordance with Topic 606. ASU 2016-13: In June 2016, the FASB issued ASU 2016-13- Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 amends guidance on reporting credit losses for assets held at amortized cost basis and available for sale debt securities. For public entities, the amendments of this Update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early application is permitted. Management is in the process of assessing the impact of the amendment of this Update on the Partnership's consolidated financial position and performance. |
Transactions with related parti
Transactions with related parties: | 6 Months Ended |
Jun. 30, 2018 | |
Related Party Transaction, Due from (to) Related Party | |
Transactions with related parties: | 3. Transactions with related parties: During the six month periods ended June 30, 2018 and 2017, the Partnership incurred the following charges in connection with related party transactions, which are included in the accompanying unaudited interim condensed consolidated financial statements: Six months ended June 30, 2018 2017 Included in voyage expenses Charter hire commissions (a) $ 858 $ 934 Included in general and administrative expenses – related party Executive services fee (d) $ 326 $ 289 Administrative services fee (e) $ 60 $ 60 Management fees-related party Management fees (a) $ 3,147 $ 3,056 As of June 30, 2018 and December 31, 2017, balances with related parties consisted of the following: Period/Year ended June 30, 2018 December 31, 2017 Assets: Working capital advances granted to the Manager (a) $ 2,348 $ 883 Security deposits to Manager (a) $ 1,350 $ 1,350 Liabilities included in Due to related party: Administrative service charges due to Manager (e) $ 30 $ 30 Other Partnership expenses due to Manager $ 50 $ 42 Total liabilities due to related party, current $ 80 $ 72 a) Dynagas Ltd. The Partnership’s vessels have entered into vessel management agreements with Dynagas Ltd., the Partnership’s Manager. Pursuant to the terms of these agreements (the “Management Agreements”), the Manager provides each vessel-owning entity of the Partnership with management services, including, but not limited to, commercial, technical, crew, accounting and vessel administrative services in exchange for an initial fixed daily management fee of $2.5 per vessel, for a period beginning upon vessel’s delivery and until the termination of the agreement. The Management Agreements initially terminate on December 31, 2020 and shall, thereafter, automatically be extended in additional eight-year increments if notice of termination is not previously provided by the Partnership’s vessel-owning subsidiaries. Beginning on the first calendar year after the commencement of the vessel Management Agreements and each calendar year thereafter, these fees are adjusted upwards by 3% until expiration of the Management Agreement, subject to further annual increases to reflect material unforeseen costs of providing the management services, by an amount to be agreed between the Partnership and the Manager, which amount will be reviewed and approved by the Partnership’s Conflicts Committee. Under the terms of the Management Agreements, the Manager charges the Partnership for any additional capital expenditures, financial costs, operating expenses for the vessels and general and administrative expenses of the vessel owning subsidiaries of the Partnership that are not covered by the management fees. During the six month periods ended June 30, 2018 and 2017, each vessel was charged with a daily management fee of $2.9 and $2.8, respectively. During the six month periods ended June 30, 2018 and 2017, management fees under the vessel management agreements amounted to $3,147 and $3,056 respectively, and are separately reflected in the accompanying unaudited interim condensed consolidated statements of income. The Management Agreements also provide for: (i) a commission of 1.25% over charter-hire agreements arranged by the Manager, and, (ii) a lump sum new-building supervision fee of $700 for the services rendered by the Manager in respect of the construction of the vessel, if applicable, plus out of pocket expenses. During the six month periods ended June 30, 2018 and 2017, charter hire commissions under the vessel Management Agreements amounted to $858 and $934, respectively, and are reflected in the accompanying unaudited interim condensed consolidated statements of income. The Management Agreements will terminate automatically after a change of control of the owners and/or of the owners’ ultimate parent, in which case an amount equal to the estimated remaining fees, but in any case not less than for a period of 36 months and not more than 60 months, will become payable to the Manager. As of June 30, 2018, based on the maximum period prescribed in the Management Agreements up to the initial termination period and the basic daily fee in effect during the six months ended June 30, 2018, such termination fee would be approximately $19.1 million. The Management Agreements also provide for an advance equal to three months daily management fee. In the case of termination of the Management Agreements, prior to their eight year term, by any reason other than Manager’s default, the advance is not refundable. Such advances as of June 30, 2018 and December 31 2017, amounted to $1,350, and are separately reflected in Non-Current Assets as Due from related party in the accompanying consolidated balance sheets. In addition, the Manager makes payments for operating expenses with funds provided by the Partnership. As of June 30, 2018 and December 31, 2017, amounts of $2,348 and $883, respectively, were due from the Manager in relation to these working capital advances granted to it. (b) Loan from related party On November 18, 2013, upon the completion of its IPO, the Partnership entered into an interest free $30.0 million revolving credit facility with its Sponsor, with an original term of five years from the closing date, to be used for general Partnership purposes, including working capital. The facility may be drawn and be prepaid in whole or in part at any time during the life of the facility. No amounts have been drawn under the respective facility as of June 30, 2018 and December 31, 2017. (c) Optional Vessel acquisitions from Sponsor/ Omnibus Agreement At the IPO date, the Partnership and its Sponsor entered into the Omnibus Agreement, which was subsequently amended and restated on April 12, 2016. The amended Omnibus Agreement sets out (i) the terms and the extent the Partnership and the Sponsor may compete with each other, (ii) the procedures to be followed for the exercise of the Partnership’s option to acquire the Initial Optional Vessels (as defined in the Omnibus Agreement), including the Partnership’s right to acquire the Sponsor’s ownership interest (which is currently 49.0%) in each of five joint venture entities, each of which owns a 172,000 cubic meter ARC 7 LNG carrier (or the “Additional Optional Vessels” and together with the Initial Optional Vessels, the “Optional Vessels”), two of which were delivered in late 2017 and early 2018 and three of which are currently under construction, (iii) certain rights of first offer to the Sponsor for the acquisition of LNG carriers from the Partnership, and, (iv) the Sponsor’s provisions of certain indemnities to the Partnership. On February 6, 2018, the Partnership extended with retroactive effect the deadline for exercising the purchase option for the Clean Horizon and the Clean Vision , two of the four remaining Initial Optional Vessels, up to December 31, 2018. In addition, on March 30, 2018, by mutual agreement, the Partnership and its Sponsor further extended the deadline for exercising the purchase option of the Clean Ocean and the Clean Planet , the other two of the four remaining Initial Optional Vessels, from March 31, 2018 to December 31, 2018. Following these extensions, the Partnership still retains the legal right to exercise an option to purchase from its Sponsor the four remaining Initial Optional Vessels up to December 31, 2018 and the right, but not the obligation, to acquire from its Sponsor its 49% ownership interest in the Additional Optional Vessels, after their respective delivery from the shipyard, at the period specified and as per the terms prescribed in the Omnibus Agreement. (d) Executive Services Agreement On March 21, 2014, the Partnership entered into an executive services agreement (the “Executive Services Agreement”) with its Manager with retroactive effect from the IPO closing date, pursuant to which the Manager provides the Partnership the services of its executive officers, who report directly to the Board of Directors. Under the Executive Services Agreement, the Manager is entitled to an executive services fee of €538 per annum (or $629 on the basis of a Euro/US Dollar exchange rate of €1.0000/$1.1691 at June 30, 2018), payable in equal monthly installments. The Executive Services Agreement has an initial term of five years and automatically renews for successive five year terms unless terminated earlier. During the six month periods ended June 30, 2018 and 2017, executive service fees amounted to $326 and $289, respectively, and are included in general and administrative expenses in the accompanying unaudited interim condensed consolidated statements of income. (e) Administrative Services Agreement On December 30, 2014 and with effect from the IPO closing date, the Partnership entered into an administrative services agreement (the “Administrative Services Agreement”) with its Manager, according to which the Partnership is provided with certain financial, accounting, reporting, secretarial and information technology services, for a monthly fee of $10, plus expenses, payable in quarterly installments. The Administrative Services Agreement can be terminated upon 120 days’ notice granted either by the Partnership’s Board of Directors or by Dynagas. During both the six month periods ended June 30, 2018 and 2017, administrative service fees amounted to $60 and are included in general and administrative expenses in the accompanying unaudited interim condensed consolidated statements of income. |
Vessels, net_
Vessels, net: | 6 Months Ended |
Jun. 30, 2018 | |
Vessels, Net [Abstract] | |
Vessels, net: | 4. Vessels, net: The amounts in the accompanying consolidated condensed balance sheets are analyzed as follows: Vessel Cost Accumulated Depreciation Net Book Value Balance December 31, 2017 $ 1,167,500 $ (190,202) $ 977,298 Other additions to vessels’ cost 409 — 409 Period depreciation — (15,039) (15,039) Balance June 30, 2018 $ 1,167,909 $ (205,241) $ 962,668 As of June 30, 2018, all vessels comprising the Partnership’s fleet were first priority mortgaged as collateral to secure the Term Loan B, further discussed in Note 5. |
Long-Term Debt_
Long-Term Debt: | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure | |
Long-Term Debt: | 5. Long-Term Debt: The amounts shown in the accompanying consolidated condensed balance sheets are analyzed as follows: Period/ Year Ended Debt instruments Borrowers-Issuers June 30, 2018 December 31, 2017 $480 Million Term Loan Facility Arctic LNG and Dynagas Finance LLC 475,200 477,600 $250 Million Senior Unsecured Notes Dynagas Partners and Dynagas Finance 250,000 250,000 Total debt $ 725,200 $ 727,600 Less deferred financing fees (11,619) (13,247) Total debt, net of deferred finance costs $ 713,581 $ 714,353 Less current portion, net of deferred financing fees $ (2,671) $ (2,655) Long-term debt, net of current portion and deferred financing fees $ 710,910 $ 711,698 $480 Million Senior Secured Term Loan Facility On May 18, 2017, Arctic LNG and Dynagas Finance LLC, wholly owned subsidiaries of the Partnership, as co-borrowers, entered into a $480.0 million senior secured term loan (the “Term Loan B”). The net proceeds of the Term Loan B were used to refinance and repay in full the indebtedness outstanding under the Partnership’s existing $340 million senior secured revolving credit facility and the $200 million term loan facility and to pay transaction fees and expenses. The Term Loan B bears interest at LIBOR plus a margin and provides for 0.25% quarterly amortization on the principal and a bullet payment at maturity, in May 2023. The Term Loan B is secured by, among other, first priority mortgages on the vessels owned by the borrower subsidiary guarantors, a first priority specific assignment of the existing time charters, a first priority assignment of all insurances and earnings of the vessels and pledges on certain deposit accounts of Arctic LNG and its vessel owning subsidiaries and is guaranteed by the Partnership, certain of the Partnership’s subsidiaries and the vessel-owning subsidiaries of Arctic LNG. The Term Loan B contains negative covenants customary for facilities of this type, including, among others, limitations on indebtedness, asset sales, transactions with affiliates, restricted payments (with the ability to distribute available cash subject to no event of default and compliance with certain financial covenants). $250 Million Senior Unsecured Notes due 2019 On September 15, 2014, the Partnership completed a public offering of $250.0 million aggregate principal amount Senior Unsecured Notes offering due October 30, 2019, (the “Notes”) with the purpose of funding the majority of the purchase price related to the Yenisei River acquisition. The Notes bear interest from the date of the original issue until maturity at a rate of 6.25% per year, payable quarterly in arrears on January 30, April 30, July 30 and October 30 of each year. As per the provisions of the Notes and the Indenture, the Partnership may issue from time to time, unlimited as to principal amount senior unsecured debentures, to be issued in one or more series. The Notes are unsubordinated unsecured obligations of the Partnership and are not redeemable at its option prior to maturity. The Term Loan B and the Notes contain financial covenants that require the Partnership to: meet a specified maximum loan to value ratio, which is the ratio of the aggregate principal amounts due under the Term Loan B to the aggregate fair value of the collateral vessels under the Term Loan B; meet a specified minimum debt service coverage ratio, the ratio of the twelve month rolling operating cash flow of Arctic LNG to the twelve month rolling debt service payments under the Term Loan B; maintain aggregate free liquidity of at least $20.0 million; meet a maximum leverage ratio expressed as a percentage of total borrowings to total book assets; and maintain a certain minimum net worth level. The financing agreements for both the Term Loan B and the Notes restrict the Partnership from declaring or making any distributions if an event of default occurs. The Term Loan B further restricts the Partnership from paying any dividend or other distribution unless a minimum interest coverage ratio is met on a consolidated basis. As of June 30, 2018, the Partnership was in compliance with all financial covenants prescribed in its debt agreements. The annual principal payments for the Partnership’s outstanding debt arrangements as at June 30, 2018, required to be made after the balance sheet date were as follows: Period/Year ending December 31, Amount 2018 (July to December 2018) $ 2,400 2019 254,800 2020 4,800 2021 4,800 2022 4,800 2023 and thereafter 453,600 Total long-term debt $ 725,200 The Partnership’s debt is denominated in U.S. dollars and, apart from the Notes which bear a fixed rate, the Term Loan B bears floating interest rate. The weighted average interest rate on the Partnership’s long-term debt for the six months ended June 30, 2018 and 2017, was 6.3% and 4.9%, respectively. Total interest incurred on long-term debt for the six months ended June 30, 2018 and 2017, amounted to $22,836 and $17,853, respectively, and is included in Interest and finance costs (Note 11) in the accompanying unaudited interim condensed consolidated statements of income. |
Fair Value Measurements_
Fair Value Measurements: | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Measurements | |
Fair Value Measurements: | 6. Fair Value Measurements: The following methods and assumptions were used to estimate the fair value of each class of financial instruments: Cash and cash equivalents, trade accounts receivable, amounts due from/to related parties and trade accounts payable: The carrying values reported in the accompanying consolidated balance sheets for those financial instruments (except for the fair value of non-current portion of amounts due from related party) are considered Level 1 items as they represent liquid assets with short-term maturities and are reasonable estimates of their fair values. The carrying value of these instruments is separately reflected in the accompanying consolidated balance sheets. The fair value of non-current portion of amounts due from related party, determined through Level 3 inputs of the fair value hierarchy by discounting future cash flows using the Partnership’s estimated cost of capital, is $1,113 as of June 30, 2018, compared to its carrying value of $1,350. Long-term debt: The Term Loan B discussed in Note 5 approximates its recorded value due to the variable interest rate payable and is thus considered a Level 2 item in accordance with the fair value hierarchy as LIBOR rates are observable at commonly quoted intervals for the full terms of the loans. The Notes have a fixed rate and their estimated fair value, determined through Level 2 inputs of the fair value hierarchy (quoted price in over-the-counter market), is approximately $251.2 million as of June 30, 2018, compared to its carrying value of $250.0 million. A fair value hierarchy that prioritizes the inputs used to measure fair value has been established by Generally Accepted Accounting Principles. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: Level 1: Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2: Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data; Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. |
Time charters acquired_
Time charters acquired: | 6 Months Ended |
Jun. 30, 2018 | |
Amortization of above-market acquired time charter contract to revenues | |
Time charters acquired: | 7. Time charters acquired: In December 2015, the Partnership acquired from its Sponsor the Lena River , its third Initial Optional Vessel. In connection such acquisition, the Partnership paid an aggregate $240.0 million consideration consisting of (i) the purchase price of the vessel and (ii) the fair value of the favorable time charter contract attached to the vessel. As a result, the Partnership recognized an intangible asset of $20.0 million, which represents the fair value of the time charter acquired, at the time of acquisition. During both the six months ended June 30, 2018 and 2017, the amortization of the above market acquired time charter related to the acquisition of the Lena River amounted to $3,594 and is included in Voyage revenues in the accompanying unaudited interim condensed consolidated statements of income. As of June 30, 2018 and December 31, 2017, acquired time charter contract accumulated amortization amounted to $18,327 and $14,733, respectively. The unamortized portion of the respective intangible asset as of June 30, 2018 and December 31, 2017, amounting to $1,673 and $5,267, respectively is presented under “Above-market acquired time charter contract” in the accompanying consolidated condensed balance sheets. The unamortized balance as of June 30, 2018, is expected to be amortized to revenues through the third quarter of 2018, the anticipated expiration date of the respective charter contract. |
Commitments and Contingencies_
Commitments and Contingencies: | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure | |
Commitments and Contingencies: | 8. Commitments and Contingencies: (a) Long-term time charters: The Partnership’s future minimum contractual charter revenues under its non-cancelable long-term time charter contracts, as of June 30, 2018, gross of brokerage commissions, without taking into consideration any assumed off-hire (including those arising out of periodical class survey requirements), are as analyzed below: Period/ Year ending December 31, Amount 2018 (period) $ 52,605 2019 130,336 2020 137,908 2021 126,887 2022 115,917 2023 and thereafter 889,151 Total $ 1,452,804 (b) Other: Various claims, suits, and complaints, including those involving government regulations and product liability, arise in the ordinary course of the shipping business. In addition, losses may arise from disputes with charterers, agents, insurance and other claims with suppliers relating to the operations of the Partnership’s vessels. Currently, management is not aware of any such claims not covered by insurance or contingent liabilities, which should be disclosed, or for which a provision should be established in the accompanying unaudited interim consolidated financial statements. The Partnership accrues for the cost of environmental liabilities when management becomes aware that a liability is probable and is able to reasonably estimate the probable exposure. Currently, management is not aware of any such claims or contingent liabilities, which should be disclosed, or for which a provision should be established in the accompanying unaudited interim consolidated financial statements. The Partnership is covered for liabilities associated with the individual vessels’ actions to the maximum limits as provided by Protection and Indemnity (P&I) Clubs, members of the International Group of P&I Clubs. (c) Technical and Commercial Management Agreement: As further disclosed in Note 3, the Partnership has contracted the commercial, administrative and technical management of its vessels to Dynagas Ltd. pursuant to the Management Agreements. For the commercial services provided under the Management Agreements the Partnership pays a commission of 1.25% over the charter-hire revenues arranged by the Manager, which will survive the termination of the agreement under all circumstances until the termination of each charter party in force at the time of termination. The estimated commission payable to the Manager over the minimum contractual charter revenues, discussed under (a) above, is $18,160. For vessel administrative and technical management fees, the Partnership currently pays a daily management fee of $2.9 per vessel (Note 3(a)). Such management fees for the period from July 1, 2018, to the expiration of the agreements on December 31, 2020, adjusted annually for 3% inflation as per agreement, are estimated to be $16,489 and are analyzed as follows: Period/ Year ending December 31, Amount 2018 3,200 2019 6,537 2020 6,752 Total $ 16,489 |
Partners' Equity_
Partners' Equity: | 6 Months Ended |
Jun. 30, 2018 | |
Partners' Equity | |
Partners' Equity: | 9. Partners’ Equity: Conversion of Sponsor’s Subordinated Units into Common Units: On January 23, 2017 (the “Sponsor Subordinated Units Conversion Date”), upon payment by the Partnership to its common unitholders of the quarterly distribution in respect of the fourth quarter of 2016 and upon satisfaction of certain other conditions defined and set forth in the Partnership Agreement, the Partnership’s subordination period expired and, accordingly, the Sponsor’s 14,985,000 issued and outstanding subordinated units representing limited partner interests in the Partnership were converted into common units on a one-for-one basis (the “Sponsor Subordinated Units Conversion”). As per the Partnership Agreement, after the expiration of the subordination period, arrearages in the payment of the minimum quarterly distribution on the common units from prior quarters no longer accrue and the subordinated units participate pro rata with other common units in distributions of available cash. No cash consideration was paid in connection with this conversion. As of June 30, 2018, the Partnership had 35,490,000 common units, 15,595,000 of which are owned by the Sponsor, 3,000,000 Series A Preferred Units and 35,526 general partner units issued and outstanding. Common and General Partner unit distribution provisions: After the end of the subordination period, which expired December 31, 2016, the Partnership pays distributions in the following manner: • first , 100% to the holders of common units and to the General Partner in accordance with their relative percentage interests, until the distributed amount in respect of each common unit equals the minimum quarterly distribution; and • second , 100% to the holders of common units and to the General Partner in accordance with their relative percentage interests, until each unit has received an aggregate distribution of a specified dollar amount. The percentage allocations of available cash from operating surplus among the common unitholders, the General Partner and the holders of the incentive distribution rights up to the various target distribution levels is illustrated below. The percentage interests shown for the common unitholders, the General Partner and the holders of the incentive distribution rights for the minimum quarterly distribution are also applicable to quarterly distribution amounts that are less than the minimum quarterly distribution. The percentage interests shown for our General Partner include its 0.1% General Partner interest only and assume that our General Partner has contributed any capital necessary to maintain its 0.1% General Partner interest. Under the Partnership Agreement, the holder of the incentive distribution rights in the Partnership, which is currently the General Partner, has the right to receive an increasing percentage of cash distributions after the first target distribution level. Total Quarterly Distribution Target Amount Unitholders General Partner Holders of IDRs Minimum Quarterly Distribution $0.365 99.9 % 0.1 % 0.0 % First Target Distribution up to $0.420 99.9 % 0.1 % 0.0 % Second Target Distribution above $0.420 up to $0.456 85.0 % 0.1 % 14.9 % Third Target Distribution Above $0.456 up to $0.548 75.0 % 0.1 % 24.9 % Thereafter above $0.548 50.0 % 0.1 % 49.9 % On April 12, 2018, following a strategic review of its financial profile and distribution policy, the Partnership’s Board of Directors approved a plan to reduce the common units’ quarterly distribution from $0.4225 per common unit to $0.25 per common unit, or from $1.69 to $1.00 on an annualized basis. The cash distribution at the reduced level was first applied to the first quarter of 2018 cash distribution. As the quarterly distributions with respect to the first and second quarters of 2018 were below $0.365 per common unit, both the actual cash distributions made with regards to those quarters and the allocation of net income for the purposes of the earnings per common unit calculation were based on the limited partners’ and General Partner’s ownership percentage applying to the minimum quarterly distribution level, as per the above presented distribution waterfall. Preferred Units distribution and redemption provisions: Distributions on the Series A Preferred Units are cumulative from the date of original issue and are payable quarterly on February 12, May 12, August 12 and November 12, of each year, subject to the discretion of the Partnership’s Board of Directors. Distributions are payable out of amounts legally available at a distribution rate of 9.00% per annum of the stated liquidation preference. Any time on or after August 12, 2020, the Series A Preferred Units may be redeemed, in whole or in part, at the issuer’s option, out of amounts legally available thereof, at a redemption price of $25.00 per unit plus an amount equal to all accumulated and unpaid distributions thereon to the date of redemption. The Series A Preferred Units represent perpetual equity interests in the Partnership, unlike the Partnership’s indebtedness, do not give rise to a claim for payment of a principal amount at a particular date. The Series A Preferred Units rank senior to the Partnership’s common units and to each other class or series of limited partner interests or other equity established after the original issue date of the Series A Preferred Units that is not expressly made senior to or on a parity with the Series A Preferred Units as to payment of distributions. The Series A Preferred Units rank junior to all of the Partnership’s indebtedness. Common unit distributions: On January 1, 2018, the Board of Directors declared a quarterly cash distribution, for the fourth quarter of 2017 of $0.4225 per common and general partner unit, or $15.0 million which, on January 18, 2018, was paid to all unitholders of record as of January 11, 2018. On April 12, 2018, following a strategic review of its financial profile and distribution policy, the Partnership’s Board of Directors approved a plan to reduce the common units’ quarterly distribution from $0.4225 per common unit to $0.25 per common unit, or from $1.69 to $1.00 on an annualized basis. The first quarter common unit cash distribution at the reduced level amounted to $8.9 million and was paid on May 3, 2018, to all common unitholders of record as of April 26, 2018. Preferred unit distributions: On January 19, 2018, the Partnership’s Board of Directors further declared a cash distribution of $0.5625 per unit on its Series A Preferred Units for the period from November 12, 2017 to February 11, 2018. The cash distribution was paid on February 12, 2018, to all Series A preferred unitholders of record as of February 5, 2018. On April 19, 2018, the Partnership’s Board of Directors declared a cash distribution of $0.5625 per unit on its Series A Preferred Units for the period from February 12, 2018 to May 11, 2018. The cash distribution was paid on May 14, 2018, to all Series A preferred unitholders of record as of May 5, 2018. General Partner Distributions: During the six months ended June 30, 2018 and 2017, the Partnership paid to its General Partner and holder of the incentive distribution rights in the Partnership an amount of $41 and $64, respectively. |
Earnings per Unit_
Earnings per Unit: | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Unit | |
Earnings per Unit: | 10. Earnings per Unit: The Partnership calculates earnings per unit by allocating distributed and undistributed net income/ (losses) for each period to common and general partner units, after adjusting for the effect of preferred distributions, only to the extent that they are earned. Any undistributed earnings for the period are allocated to the various unitholders based on the distribution waterfall for cash available for distribution specified in the Partnership Agreement, as generally described in Note 9 above. Where distributions relating to the period are in excess of earnings, the deficit is also allocated according to the cash distribution model. The sum of the distributed amounts and the allocation of the undistributed earnings or deficit to each class of unitholders is divided by the weighted average number of units outstanding during the period. Diluted earnings per unit, if applicable, reflects the potential dilution that could occur if potentially dilutive instruments were exercised, resulting in the issuance of additional units that would then share in the Partnership’s net earnings. The Partnership had no dilutive instruments in the six months ended June 30, 2018 and 2017. The calculations of the basic and diluted earnings per common unit are presented below: Six Months Ended June 30, 2018 2017 Partnership’s Net income $ 5,191 $ 7,731 Less: Net Income attributable to preferred unitholders 3,375 3,375 Net Income attributable to subordinated unitholders — 1,208 General Partner’s interest in Net Income 2 38 Net income attributable to common unitholders $ 1,814 $ 3,110 Weighted average number of common units outstanding, basic and diluted 35,490,000 33,585,829 Earnings per common unit, basic and diluted $ 0.05 $ 0.09 |
Interest and Finance Costs_
Interest and Finance Costs: | 6 Months Ended |
Jun. 30, 2018 | |
Interest and Finance Costs | |
Interest and Finance Costs: | 11. Interest and Finance Costs: The amounts in the accompanying unaudited interim consolidated statements of income are analyzed as follows: Six months ended June 30, 2018 2017 Interest expense (Note 5) $ 22,836 $ 17,853 Amortization and write-off of deferred financing fees 1,625 3,723 Other 165 1,042 Total $ 24,626 $ 22,618 |
Subsequent Events_
Subsequent Events: | 6 Months Ended |
Jun. 30, 2018 | |
Subsequent Events | |
Subsequent Events: | 12. Subsequent Events: (a) Second quarter of 2018 common units cash distribution: On July 2, 2018, the Partnership’s Board of Directors unanimously approved a cash distribution on the Partnership’s common units in respect of the second quarter of 2018 of $0.25 per common unit. The second quarter common unit cash distribution amounted to $8.9 million and was paid on July 19, 2018, to all common unitholders of record as of July 12, 2018. (b) Quarterly Series A Preferred units cash distribution: On July 19, 2018, the Partnership’s Board of Directors declared a cash distribution of $0.5625 per unit on its Series A Preferred Units for the period from May 12, 2018 to August 11, 2018. The cash distribution is expected to be paid on August 13, 2018, to all Series A preferred unitholders of record as of August 5, 2018. |
Significant Accounting Polici18
Significant Accounting Policies and Recent Accounting Pronouncements (Policy) | 6 Months Ended |
Jun. 30, 2018 | |
Significant Accounting Policies and Recent Accounting Pronouncements | |
Recently Adopted Accounting Policies: | During the six months ended June 30, 2018, the Partnership adopted the following standards/ standards updates: i) Accounting Standards Update (ASU) 2014-09 (Topic 606): In May 2016, the FASB issued the final standard on revenue from contracts with customers. The standard, which was issued as ASU 2014-09 (Topic 606) by the FASB, and as amended, outlines a single comprehensive model for entities to use in accounting for revenue from contracts with customers and supersedes most legacy revenue recognition guidance. The core principle of the guidance in Topic 606 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services by applying the following steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in each contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in each contract; and (5) recognize revenue when (or as) the entity satisfies a performance obligation. The standard is effective for public business entities from annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. The new revenue standard may be applied using either of the following transition methods: (1) a full retrospective approach reflecting the application of the standard in each prior reporting period with the option to elect certain practical expedients, or (2) a modified retrospective approach with the cumulative effect of initially adopting the standard recognized at the date of adoption (which includes additional footnote disclosures). The adoption of this standard primarily changes the method of recognizing revenue for voyage charters from the discharge-to-discharge method to the loading-to-discharge method. Under the discharge-to-discharge method, revenue was recognized from the discharge of the prior voyage, or contract date of the current voyage if later, until the discharge of the current voyage. Under the load-to-discharge method, revenue is recognized from the load of a voyage until its discharge. The Partnership neither currently operates nor has historically operated any of its fleet vessels under voyage charters and in this respect, the Partnership’s revenue is primarily derived from time charters and accounted for under ASC 840 Leases. The Partnership adopted the provisions of ASC 606 on January 1, 2018 and elected to use the modified retrospective approach as an application transition method. The Partnership’s quantitative assessment of the effects of the adoption of this new guidance indicated that the financial impact of applying the new revenue recognition standard as outlined above did not have any effect to the opening retained earnings of the Partnership as of January 1, 2018. ii) ASU 2016-01, Financial Instruments- Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The amendments in this update (the “Update”) affect all entities that hold financial assets or owe financial liabilities and address certain aspects of recognition, measurement, presentation and disclosure of financial instruments. This new standard was adopted on January 1, 2018 and had no impact on the Partnership’s consolidated financial statements and notes disclosures. iii) ASU No. 2016-15- Statement of Cash Flows Classification of Certain Cash Receipts. This Update addresses eight specific cash flow issues and provides specific guidance in how certain cash receipts and cash payments should be presented and classified in the statement of cash flows under Topic 230 with the objective of reducing the current and potential future diversity in practice. ASU No. 2016-15 was adopted as of January 1, 2018 and its adoption did not result in any changes in the classification of cash receipts and cash payments in the Partnership’s reported statements of cash flows. iv) ASU No. 2016-18—Statement of Cash Flows – Restricted Cash. The amendments in this Update require that a statement of cash flows explains the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Partnership early adopted ASU No. 2016-18 as of April 1, 2018. The amendments in this update should be applied using a retrospective transition method to each period presented. As a result, an amount of $25,000 of non-current restricted cash has been aggregated with the $57,595 cash and cash equivalents in the beginning of period line item on the comparative statement of cash flows for the six months ended June 30, 2017. v) ASU 2017-01 — Business Combinations, Clarifying the Definition of a business. The amendments is this update were issued in order to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisition (or disposals) of assets or businesses. This ASU provides a screen to determine when a set of assets and activities does not constitute a business. The screen requires that when substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets, the set is not a business. The implementation of this standards update as of January 1, 2018, had no impact on the Partnership’s consolidated financial statements. |
Recent Accounting Pronouncements: | Recent Accounting Pronouncements: ASU 2016-02: In February 2016, the FASB issued ASU No. 2016-02, Leases (ASC 842), and as amended, which requires lessees to recognize most leases on the balance sheet. This is expected to increase both reported assets and liabilities. The new lease standard does not substantially change lessor accounting. For public companies, the standard will be effective for the first interim reporting period within annual periods beginning after December 15, 2018, although early adoption is permitted. Lessees and lessors will be required to apply the new standard at the beginning of the earliest period presented in the financial statements in which they first apply the new guidance, using a modified retrospective transition method. In July 2018, the FASB issued ASU No. 2018-11, Leases (ASC 842) – Targeted Improvements. The amendments in this Update: (i) provide entities with an additional (and optional) transition method to adopt the new leases standard, under which an entity initially applies the new leases standard at the adoption date and recognizes a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption consistent with preparers' requests and (ii) provide lessors with a practical expedient, by class of underlying asset, to not separate non-lease components from the associated lease component and, instead, to account for those components as a single component if the non-lease components otherwise would be accounted for under the new revenue guidance (Topic 606) and both of the following are met: (a) the timing and pattern of transfer of the non-lease component(s) and associated lease component are the same and (b) the lease component, if accounted for separately, would be classified as an operating lease. If the non-lease component or components associated with the lease component are the predominant component of the combined component, an entity is required to account for the combined component in accordance with Topic 606. ASU 2016-13: In June 2016, the FASB issued ASU 2016-13- Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 amends guidance on reporting credit losses for assets held at amortized cost basis and available for sale debt securities. For public entities, the amendments of this Update are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Early application is permitted. Management is in the process of assessing the impact of the amendment of this Update on the Partnership's consolidated financial position and performance. |
Partnership Formation and Gen19
Partnership Formation and General Information (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements | |
Vessel Owning Subsidiaries | Company Name Country of incorporation Vessel Name Delivery Date from shipyard Delivery date to Partnership Cbm Capacity Pegasus Shipholding S.A. (“Pegasus”) Marshall Islands Clean Energy March 2007 n/a 149,700 Lance Shipping S.A. (“Lance”) Marshall Islands Ob River July 2007 n/a 149,700 Seacrown Maritime Ltd. (“Seacrown”) Marshall Islands Amur River January 2008 n/a 149,700 Fareastern Shipping Limited (“Fareastern”) Malta Arctic Aurora July 2013 June 2014 155,000 Navajo Marine Limited (“Navajo”) Marshall Islands Yenisei River July 2013 September 2014 155,000 Solana Holding Ltd. (“Solana”) Marshall Islands Lena River October 2013 December 2015 155,000 |
Non-Vessel Owning Subsidiaries | Company Name Country of incorporation Purpose of incorporation Dynagas Equity Holding Limited (“Dynagas Equity”) Liberia Holding company that owns all of the outstanding share capital of Arctic LNG Carriers Ltd. (“Arctic LNG”). Dynagas Operating GP LLC (“Dynagas Operating GP”) Marshall Islands Limited Liability Company in which the Partnership holds a 100% membership interest and which has 100% of the Non-Economic General Partner Interest in Dynagas Operating LP. Dynagas Operating LP (“Dynagas Operating”) Marshall Islands Limited partnership in which the Partnership holds a 100% limited partnership interest and which owns 100% of the issued and outstanding share capital of Dynagas Equity. Dynagas Finance Inc. Marshall Islands Wholly owned subsidiary of the Partnership whose activities are limited to co-issuing the Senior Unsecured Notes discussed under Note 5 and engaging in other activities incidental thereto. Arctic LNG Marshall Islands Wholly owned subsidiary of the Partnership which is directly wholly owned by Dynagas Equity and which owns all of the issued and outstanding share capital of Pegasus, Lance, Seacrown, Fareastern, Navajo, Solana and Dynagas Finance LLC. Dynagas Finance LLC Delaware Wholly owned subsidiary of Arctic LNG and co-borrower of the Term Loan B discussed under Note 5. |
Significant Accounting Polici20
Significant Accounting Policies and Recent Accounting Pronouncements (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Significant Accounting Policies and Recent Accounting Pronouncements | |
Major Charterers | Charterer 2018 2017 A 75 % 70 % B 19 % 19 % C - % 11 % Total 94 % 100 % |
Transactions with related par21
Transactions with related parties (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Related Party Transaction, Due from (to) Related Party | |
Related parties transactions | Six months ended June 30, 2018 2017 Included in voyage expenses Charter hire commissions (a) $ 858 $ 934 Included in general and administrative expenses – related party Executive services fee (d) $ 326 $ 289 Administrative services fee (e) $ 60 $ 60 Management fees-related party Management fees (a) $ 3,147 $ 3,056 |
Related parties balances | Period/Year ended June 30, 2018 December 31, 2017 Assets: Working capital advances granted to the Manager (a) $ 2,348 $ 883 Security deposits to Manager (a) $ 1,350 $ 1,350 Liabilities included in Due to related party: Administrative service charges due to Manager (e) $ 30 $ 30 Other Partnership expenses due to Manager $ 50 $ 42 Total liabilities due to related party, current $ 80 $ 72 |
Vessels, net (Tables)
Vessels, net (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Property Plant and Equipment Net | |
Vessels Table | Vessel Cost Accumulated Depreciation Net Book Value Balance December 31, 2017 $ 1,167,500 $ (190,202) $ 977,298 Other additions to vessels’ cost 409 — 409 Period depreciation — (15,039) (15,039) Balance June 30, 2018 $ 1,167,909 $ (205,241) $ 962,668 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure | |
Loans And Credit Facilities Amounts Outstanding | Period/ Year Ended Debt instruments Borrowers-Issuers June 30, 2018 December 31, 2017 $480 Million Term Loan Facility Arctic LNG and Dynagas Finance LLC 475,200 477,600 $250 Million Senior Unsecured Notes Dynagas Partners and Dynagas Finance 250,000 250,000 Total debt $ 725,200 $ 727,600 Less deferred financing fees (11,619) (13,247) Total debt, net of deferred finance costs $ 713,581 $ 714,353 Less current portion, net of deferred financing fees $ (2,671) $ (2,655) Long-term debt, net of current portion and deferred financing fees $ 710,910 $ 711,698 |
Minimum Annual Principal Payments | Period/Year ending December 31, Amount 2018 (July to December 2018) $ 2,400 2019 254,800 2020 4,800 2021 4,800 2022 4,800 2023 and thereafter 453,600 Total long-term debt $ 725,200 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure | |
Minimum Future Charter Revenues | Period/ Year ending December 31, Amount 2018 (period) $ 52,605 2019 130,336 2020 137,908 2021 126,887 2022 115,917 2023 and thereafter 889,151 Total $ 1,452,804 |
Management Fees | Period/ Year ending December 31, Amount 2018 3,200 2019 6,537 2020 6,752 Total $ 16,489 |
Partners' Equity (Tables)
Partners' Equity (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Partners' Equity | |
Percentage allocations of available cash from operating surplus amongst the unit holders | Total Quarterly Distribution Target Amount Unitholders General Partner Holders of IDRs Minimum Quarterly Distribution $0.365 99.9 % 0.1 % 0.0 % First Target Distribution up to $0.420 99.9 % 0.1 % 0.0 % Second Target Distribution above $0.420 up to $0.456 85.0 % 0.1 % 14.9 % Third Target Distribution Above $0.456 up to $0.548 75.0 % 0.1 % 24.9 % Thereafter above $0.548 50.0 % 0.1 % 49.9 % |
Earnings per Unit (Tables)
Earnings per Unit (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Unit | |
Basic and Diluted Earnings per Unit | Six Months Ended June 30, 2018 2017 Partnership’s Net income $ 5,191 $ 7,731 Less: Net Income attributable to preferred unitholders 3,375 3,375 Net Income attributable to subordinated unitholders — 1,208 General Partner’s interest in Net Income 2 38 Net income attributable to common unitholders $ 1,814 $ 3,110 Weighted average number of common units outstanding, basic and diluted 35,490,000 33,585,829 Earnings per common unit, basic and diluted $ 0.05 $ 0.09 |
Interest and Finance Costs (Tab
Interest and Finance Costs (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Interest and Finance Costs | |
Interest and Finance Costs | Six months ended June 30, 2018 2017 Interest expense (Note 5) $ 22,836 $ 17,853 Amortization and write-off of deferred financing fees 1,625 3,723 Other 165 1,042 Total $ 24,626 $ 22,618 |
Partnership Formation and Gen28
Partnership Formation and General Information - Vessel Owning Subsidiaries (Table) (Details) | 6 Months Ended |
Jun. 30, 2018 | |
Clean Energy | Delivery from Shipyard | |
Property, Plant and Equipment [Line Items] | |
Delivery Date | March 2,007 |
Cbm Capacity | 149,700 |
Ob River | Delivery from Shipyard | |
Property, Plant and Equipment [Line Items] | |
Delivery Date | July 2,007 |
Cbm Capacity | 149,700 |
Amur River | Delivery from Shipyard | |
Property, Plant and Equipment [Line Items] | |
Delivery Date | January 2,008 |
Cbm Capacity | 149,700 |
Arctic Aurora | Delivery to Partnership | |
Property, Plant and Equipment [Line Items] | |
Delivery Date | June 2,014 |
Cbm Capacity | 155,000 |
Yenisei River | Delivery to Partnership | |
Property, Plant and Equipment [Line Items] | |
Delivery Date | September 2,014 |
Cbm Capacity | 155,000 |
Lena River | Delivery to Partnership | |
Property, Plant and Equipment [Line Items] | |
Delivery Date | December 2,015 |
Cbm Capacity | 155,000 |
Partnership Formation and Gen29
Partnership Formation and General Information - Non-Vessel Owning Subsidiaries (Table) (Details) | 6 Months Ended |
Jun. 30, 2018 | |
Dynagas Operating GP LLC. | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Ownership interest in subsidiary | 100.00% |
Dynagas Operating LP. | |
Subsidiary of Limited Liability Company or Limited Partnership [Line Items] | |
Ownership interest in subsidiary | 100.00% |
Partnership Formation and Gen30
Partnership Formation and General Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 11 Months Ended |
Jun. 30, 2018 | Nov. 18, 2013 | |
General Partner | ||
Related Party Transaction [Line Items] | ||
General Partner Interest in Dynagas LNG Partners LP | 0.10% | |
Common | ||
Related Party Transaction [Line Items] | ||
Limited Partners Capital Account Units Offered | 8,250,000 | |
Shares Issued, Price Per Share | $ 18 | |
Dynagas Holding Ltd | ||
Related Party Transaction [Line Items] | ||
Ownership percentage in Dynagas LNG Partners LP, including General Partner interest | 44.00% | |
Dynagas Holding Ltd | ||
Related Party Transaction [Line Items] | ||
Limited Partners Capital Account Units Offered | 4,250,000 | |
Shares Issued, Price Per Share | $ 18 | |
Line of credit facility, maximum borrowing capacity | $ 30,000 |
Significant Accounting Polici31
Significant Accounting Policies and Recent Accounting Pronouncements - Major Charterers (Table) (Details) | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Entity Wide Revenue Major Customer | ||
Concentration risk benchmark description | During the six month periods ended June 30, 2018 and 2017, charterers that individually accounted for more than 10% of the Partnership’s revenues were as follows | |
Percentage of time charter revenue | 94.00% | 100.00% |
Charterer A | ||
Entity Wide Revenue Major Customer | ||
Percentage of time charter revenue | 75.00% | 70.00% |
Charterer B | ||
Entity Wide Revenue Major Customer | ||
Percentage of time charter revenue | 19.00% | 19.00% |
Charterer C | ||
Entity Wide Revenue Major Customer | ||
Percentage of time charter revenue | 0.00% | 11.00% |
Sales Revenue, Net | ||
Entity Wide Revenue Major Customer | ||
Percentage of time charter revenue | 10.00% |
Significant Accounting Polici32
Significant Accounting Policies and Recent Accounting Pronouncements (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 |
Cash and cash equivalents | $ 57,818 | $ 67,464 | $ 74,311 |
Adoption of accounting standard update, amounts aggregated | |||
Non-current restricted cash | 25,000 | ||
Cash and cash equivalents | $ 57,595 |
Transactions with related par33
Transactions with related parties - Statements of Income (Table) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Included in voyage expenses | ||
Charter hire commissions (a) | $ 858 | $ 934 |
Included in general and administrative expenses - related party | ||
Executive services fee (d) | 326 | 289 |
Administrative services fee (e) | 60 | 60 |
Management fees-related party | ||
Management fees (a) | $ 3,147 | $ 3,056 |
Transactions with related par34
Transactions with related parties - Balance Sheet (Table) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Assets: | ||
Due from related party | $ 2,348 | $ 883 |
Due from related party, non-current | 1,350 | 1,350 |
Liabilities: | ||
Due to related party, current | 80 | 72 |
Working capital advances granted to the Manager (a) | ||
Assets: | ||
Due from related party | 2,348 | 883 |
Security deposits to Manager (a) | ||
Assets: | ||
Due from related party, non-current | 1,350 | 1,350 |
Administrative service charges due to Manager (e) | ||
Liabilities: | ||
Due to related party, current | 30 | 30 |
Other Partnership expenses due to Manager | ||
Liabilities: | ||
Due to related party, current | 50 | 42 |
Dynagas Ltd. | ||
Liabilities: | ||
Due to related party, current | $ 80 | $ 72 |
Transactions with related par35
Transactions with related parties - Dynagas Ltd. (Details) - USD ($) | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2013 | Dec. 31, 2017 | |
Related Party Transaction | ||||
Automatic extension of Management Agreements increments | 8 years | |||
Management services agreement initial termination date | December 31, 2020 | |||
Daily management fee | $ 2,900 | $ 2,800 | $ 2,500 | |
Management fees annual upward percentage adjustment | 3.00% | |||
Charter Hire Commission payable to the Management company | 1.25% | |||
Lump sum payable to the management company for the supervision of vessels construction | $ 700,000 | |||
Cancellation of management agreement termination fee | 19,100,000 | |||
Management fee paid in advance | $ 1,350,000 | $ 1,350,000 | ||
Management agreement terms | The Management Agreements will terminate automatically after a change of control of the owners and/or of the owners’ ultimate parent, in which case an amount equal to the estimated remaining fees, but in any case not less than for a period of 36 months and not more than 60 months, will become payable to the Manager. | |||
Minimum | ||||
Related Party Transaction | ||||
Period for calculation of management agreement termination fee | 36 months | |||
Maximum | ||||
Related Party Transaction | ||||
Period for calculation of management agreement termination fee | 60 months |
Transactions with related par36
Transactions with related parties - Loan from related party (Details) - Dynagas Holding Ltd - USD ($) $ in Thousands | 6 Months Ended | 11 Months Ended | 12 Months Ended |
Jun. 30, 2018 | Nov. 18, 2013 | Dec. 31, 2017 | |
Debt Instruments | |||
Revolving credit facility borrowing capacity | $ 30,000 | ||
Revolving credit facility amount drawn down | $ 0 | $ 0 | |
Duration of facility | 5 years |
Transactions with related par37
Transactions with related parties - Optional Vessel acquisitions from Sponsor/ Omnibus Agreement (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |
Feb. 06, 2018 | Mar. 30, 2018 | Apr. 12, 2016 | Jun. 30, 2018 | |
Amended Omnibus Agreement | Legal right to acquire Sponsor's interests in Additional Optional Vessels | ||||
Related Party Transaction [Line Items] | ||||
Percentage of ownership in entity | 49.00% | |||
LNG Carrier Capacity | 172,000 | |||
Number Of Vessels | 5 | |||
Vessel Type | ARC 7 LNG carrier | |||
Dynagas Holding Ltd | Legal right to acquire Sponsor's interests in Initial Optional Vessels | ||||
Related Party Transaction [Line Items] | ||||
Number Of Vessels | 4 | |||
Additional Optional Vessels | ||||
Related Party Transaction [Line Items] | ||||
Delivery Date | late 2017 and early 2018 | |||
Number Of Vessels | 2 | |||
Clean Horizon and Clean Vision | Extension of the purchase option exercise deadline | ||||
Related Party Transaction [Line Items] | ||||
Number Of Vessels | 2 | |||
Purchase option period, Expiration date | Dec. 31, 2018 | |||
Clean Ocean and Clean Planet | Extension of the purchase option exercise deadline | ||||
Related Party Transaction [Line Items] | ||||
Number Of Vessels | 2 | |||
Purchase option period, Expiration date | Dec. 31, 2018 |
Transactions with related par38
Transactions with related parties - Executive - Administrative Services Agreement (Details) € in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |
Mar. 21, 2014EUR (€) | Jun. 30, 2018USD ($) | Jun. 30, 2017USD ($) | Dec. 30, 2014USD ($) | |
Related Party Transaction [Line Items] | ||||
Eur/US Dollar exchange rate | 1.1691 | |||
Administrative services fee | $ 60 | $ 60 | ||
Executive services agreement | ||||
Related Party Transaction [Line Items] | ||||
Annual executive services fee | € 538 | $ 629 | ||
Executive services agreement duration | Initial term of five years and automatically renews for successive five year terms unless terminated earlier. | |||
Executive Services Agreement - Initial Term | ||||
Related Party Transaction [Line Items] | ||||
Executive services agreement duration | 5 years | |||
Executive Services Agreement - Automatic Renewal | ||||
Related Party Transaction [Line Items] | ||||
Executive services agreement duration | 5 years | |||
Administrative Services Agreement | ||||
Related Party Transaction [Line Items] | ||||
Administrative services duration | perpetual | |||
Administrative services days termination notice | 120 days | |||
Administrative Services Agreement | Monthly fee | ||||
Related Party Transaction [Line Items] | ||||
Administrative services fee | $ 10 |
Vessels, net (Table) (Details)
Vessels, net (Table) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Property Plant And Equipment | ||
Balance beginning of period | $ 977,298 | |
Other additions to vessels' cost | 409 | |
Period depreciation | (15,039) | $ (15,035) |
Balance end of period | 962,668 | |
Vessel Cost | ||
Property Plant And Equipment | ||
Balance beginning of period | 1,167,500 | |
Other additions to vessels' cost | 409 | |
Balance end of period | 1,167,909 | |
Accumulated Depreciation | ||
Property Plant And Equipment | ||
Balance beginning of period | (190,202) | |
Period depreciation | (15,039) | |
Balance end of period | (205,241) | |
Net Book Value | ||
Property Plant And Equipment | ||
Balance beginning of period | 977,298 | |
Other additions to vessels' cost | 409 | |
Period depreciation | (15,039) | |
Balance end of period | $ 962,668 |
Long-Term Debt - Credit Facilit
Long-Term Debt - Credit Facilities And Senior Notes (Table) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Debt Instruments | ||
Total debt | $ 725,200 | $ 727,600 |
Less deferred financing fees | (11,619) | (13,247) |
Total debt, net of deferred finance costs | 713,581 | 714,353 |
Less current portion, net of deferred financing fees | (2,671) | (2,655) |
Long-term debt, net of current portion and deferred financing fees | 710,910 | 711,698 |
$250 Million Senior Unsecured Notes | ||
Debt Instruments | ||
Senior Unsecured Notes | 250,000 | |
$250 Million Senior Unsecured Notes | Dynagas Partners and Dynagas Finance | ||
Debt Instruments | ||
Senior Unsecured Notes | 250,000 | 250,000 |
$480 Million Term Loan Facility | Arctic LNG and Dynagas Finance LLC | ||
Debt Instruments | ||
Long-term debt | $ 475,200 | $ 477,600 |
Long-Term Debt - Principal Paym
Long-Term Debt - Principal Payments (Table) (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Debt Disclosure | ||
2018 (July to December 2018) | $ 2,400 | |
2,019 | 254,800 | |
2,020 | 4,800 | |
2,021 | 4,800 | |
2,022 | 4,800 | |
2023 and thereafter | 453,600 | |
Total long-term debt | $ 725,200 | $ 727,600 |
Long-Term Debt - Credit Facil42
Long-Term Debt - Credit Facilities And Senior Notes (Details) - USD ($) $ in Thousands | 5 Months Ended | 6 Months Ended | ||
May 18, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Sep. 15, 2014 | |
Debt Instruments | ||||
Weighted average interest rate | 6.30% | 4.90% | ||
Total interest incurred on long-term debt | $ 22,836 | $ 17,853 | ||
$250.0 Million Senior Unsecured Notes due 2019 | ||||
Debt Instruments | ||||
Principal amount | $ 250,000 | |||
Debt Instrument, Maturity Date | Oct. 30, 2019 | |||
Senior notes, terms | The Notes bear interest from the date of the original issue until maturity at a rate of 6.25% per year, payable quarterly in arrears on January 30, April 30, July 30 and October 30 of each year. | |||
Senior notes interest rate | 6.25% | |||
$480 Term Loan B | ||||
Debt Instruments | ||||
Principal amount | $ 480,000 | |||
Line of credit facility, frequency of payments | quarterly | |||
Debt Instrument, Maturity Date | May 18, 2023 | |||
Debt instrument, description of variable rate basis | LIBOR | |||
Debt instrument, payment percentage | 0.25% | |||
Debt Proceeds used to repay previous indebtedness | The net proceeds of the Term Loan B were used to refinance and repay in full the indebtedness outstanding under the Partnership’s existing $340 million senior secured revolving credit facility and the $200 million term loan facility and to pay transaction fees and expenses. |
Long-Term Debt - Loans And Cred
Long-Term Debt - Loans And Credit Facilities Terms and Compliance (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Debt Instruments | |
Covenant compliance | As of June 30, 2018, the Partnership was in compliance with all financial covenants prescribed in its debt agreements. |
$250 Million Senior Unsecured Notes | Minimum | |
Debt Instruments | |
Free cash liquidity requirement | $ 20,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Jun. 30, 2018 | Dec. 31, 2017 |
Debt Instruments | ||
Due from related parties non current carrying value | $ 1,350 | $ 1,350 |
Due from related parties non current fair value - determined through level 3 inputs | 1,113 | |
$250 Million Senior Unsecured Notes | ||
Debt Instruments | ||
Senior notes carrying value | 250,000 | |
Senior notes fair value - determined through level 2 inputs | $ 251,200 |
Time charters acquired (Details
Time charters acquired (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Dec. 21, 2015 | Dec. 31, 2017 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Fair value of the favorable time charter acquired | $ 20,000 | |||
Amortization of intangible assets | $ 3,594 | $ 3,594 | ||
Accumulated amortization | 18,327 | $ 14,733 | ||
Above-market acquired time charter contract, net | 1,673 | $ 5,267 | ||
Lena River | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Consideration for vessel and related time charter | $ 240,000 | |||
Amortization of intangible assets | $ 3,594 | $ 3,594 |
Commitments and Contingencies -
Commitments and Contingencies - Charter Hire (Table) (Details) $ in Thousands | Jun. 30, 2018USD ($) |
Minimum Future Charter Revenues for the year ending | |
2018 (period) | $ 52,605 |
2,019 | 130,336 |
2,020 | 137,908 |
2,021 | 126,887 |
2,022 | 115,917 |
2023 and thereafter | 889,151 |
Total | $ 1,452,804 |
Commitments and Contingencies47
Commitments and Contingencies - Management Fees (Table) (Details) $ in Thousands | Jun. 30, 2018USD ($) |
Management Fees for the year ending | |
2,018 | $ 3,200 |
2,019 | 6,537 |
2,020 | 6,752 |
Total | $ 16,489 |
Commitments and Contingencies48
Commitments and Contingencies (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2013 | |
Property, Plant and Equipment [Line Items] | |||
Charter Hire Commission payable to the Management company | 1.25% | ||
Commission payable over the minimum contractual charter revenues | $ 18,160,000 | ||
Daily management fee | $ 2,900 | $ 2,800 | $ 2,500 |
Inflation rate adjustment to management fees | 3.00% |
Partners' Equity (Table) (Detai
Partners' Equity (Table) (Details) | 6 Months Ended |
Jun. 30, 2018$ / shares | |
Total Quarterly Distribution Target Amount | Minimum Quarterly Distribution | Minimum | |
Distribution Per Unit | $ 0.365 |
Total Quarterly Distribution Target Amount | First Target Distribution | Maximum | |
Distribution Per Unit | 0.42 |
Total Quarterly Distribution Target Amount | Second Target Distribution | Minimum | |
Distribution Per Unit | 0.42 |
Total Quarterly Distribution Target Amount | Second Target Distribution | Maximum | |
Distribution Per Unit | 0.456 |
Total Quarterly Distribution Target Amount | Third Target Distribution | Minimum | |
Distribution Per Unit | 0.456 |
Total Quarterly Distribution Target Amount | Third Target Distribution | Maximum | |
Distribution Per Unit | 0.548 |
Total Quarterly Distribution Target Amount | Thereafter | Minimum | |
Distribution Per Unit | $ 0.548 |
Limited Unitholders | Minimum Quarterly Distribution | |
Percentage allocations of the additional available cash | 99.90% |
Limited Unitholders | First Target Distribution | |
Percentage allocations of the additional available cash | 99.90% |
Limited Unitholders | Second Target Distribution | |
Percentage allocations of the additional available cash | 85.00% |
Limited Unitholders | Third Target Distribution | |
Percentage allocations of the additional available cash | 75.00% |
Limited Unitholders | Thereafter | |
Percentage allocations of the additional available cash | 50.00% |
General Partner | Minimum Quarterly Distribution | |
Percentage allocations of the additional available cash | 0.10% |
General Partner | First Target Distribution | |
Percentage allocations of the additional available cash | 0.10% |
General Partner | Second Target Distribution | |
Percentage allocations of the additional available cash | 0.10% |
General Partner | Third Target Distribution | |
Percentage allocations of the additional available cash | 0.10% |
General Partner | Thereafter | |
Percentage allocations of the additional available cash | 0.10% |
Holders of IDRs | Minimum Quarterly Distribution | |
Percentage allocations of the additional available cash | 0.00% |
Holders of IDRs | First Target Distribution | |
Percentage allocations of the additional available cash | 0.00% |
Holders of IDRs | Second Target Distribution | |
Percentage allocations of the additional available cash | 14.90% |
Holders of IDRs | Third Target Distribution | |
Percentage allocations of the additional available cash | 24.90% |
Holders of IDRs | Thereafter | |
Percentage allocations of the additional available cash | 49.90% |
Partners' Equity (Details)
Partners' Equity (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||
Jan. 23, 2017shares | Apr. 12, 2018$ / shares | Jun. 30, 2018USD ($)$ / sharesshares | Jun. 30, 2017USD ($) | Dec. 31, 2017shares | Jul. 20, 2015$ / shares | |
Related Party Transaction | ||||||
Common unitholders - units issued | shares | 35,490,000 | 35,490,000 | ||||
Common unitholders - units outstanding | shares | 35,490,000 | 35,490,000 | ||||
Series A Preferred Units issued | shares | 3,000,000 | 3,000,000 | ||||
Series A Preferred Units outstanding | shares | 3,000,000 | 3,000,000 | ||||
General Partner unitholders - units issued | shares | 35,526 | 35,526 | ||||
General Partner unitholders - units outstanding | shares | 35,526 | 35,526 | ||||
Total distributions paid to all classes of unitholders | $ | $ 27,283 | $ 33,429 | ||||
Distribution 4 - FY 2017 | ||||||
Related Party Transaction | ||||||
Distribution Made To Limited Partner And General Partner Declaration Date | Jan. 1, 2018 | |||||
Distributions paid, Per unit | $ 0.4225 | |||||
Total distributions paid to all classes of unitholders | $ | $ 15,000 | |||||
Distributions per unit declared - distribution date | Jan. 18, 2018 | |||||
Distributions per unit declared - record date | Jan. 11, 2018 | |||||
Distribution 1 - FY 2018 | ||||||
Related Party Transaction | ||||||
Distribution Made To Limited Partner And General Partner Announcement Date | Apr. 12, 2018 | |||||
Distributions paid, Per unit | $ 0.25 | |||||
Total distributions paid to all classes of unitholders | $ | $ 8,900 | |||||
Distributions per unit declared - distribution date | May 3, 2018 | |||||
Distributions per unit declared - record date | Apr. 26, 2018 | |||||
General Partner | ||||||
Related Party Transaction | ||||||
General Partner Distributions | $ | $ 41 | $ 64 | ||||
Series A Preferred | ||||||
Related Party Transaction | ||||||
Preferred Stock Dividend Rate Percentage | 9.00% | |||||
Series A Preferred | Distribution from November 12, 2017 to February 11, 2018 | ||||||
Related Party Transaction | ||||||
Distribution Made To Limited Partner And General Partner Declaration Date | Jan. 19, 2018 | |||||
Distributions paid, Per unit | $ 0.5625 | |||||
Distributions per unit declared - distribution date | Feb. 12, 2018 | |||||
Distributions per unit declared - record date | Feb. 5, 2018 | |||||
Series A Preferred | Distribution from February 12, 2018 to May 11, 2018 | ||||||
Related Party Transaction | ||||||
Distribution Made To Limited Partner And General Partner Announcement Date | Apr. 19, 2018 | |||||
Distributions paid, Per unit | $ 0.5625 | |||||
Distributions per unit declared - distribution date | May 14, 2018 | |||||
Distributions per unit declared - record date | May 5, 2018 | |||||
Sponsor | ||||||
Related Party Transaction | ||||||
Common unitholders - units outstanding | shares | 15,595,000 | |||||
Partners' subordinated units converted | shares | 14,985,000 | |||||
Subordinated units converted to Common, Conversion Basis | one-for-one basis | |||||
Subordinated units converted to Common, Conversion Ratio | 1 | |||||
After subordination period | ||||||
Related Party Transaction | ||||||
Distribution payment terms | First, 100% to the holders of common units and to the General Partner in accordance with their relative percentage interests, until the distributed amount in respect of each common unit equals the minimum quarterly distribution; and second, 100% to the holders of common units and to the General Partner in accordance with their relative percentage interests, until each unit has received an aggregate distribution of a specified dollar amount. | |||||
Any time on or after August 12, 2020 | Series A Preferred | ||||||
Related Party Transaction | ||||||
Preferred stock liquidation preference | $ 25 | |||||
Quarterly distribution before strategic review | Distribution 1 - FY 2018 | ||||||
Related Party Transaction | ||||||
Distributions paid, Per unit | $ 0.4225 | |||||
Quarterly distribution after strategic review | Distribution 1 - FY 2018 | ||||||
Related Party Transaction | ||||||
Distributions paid, Per unit | 0.25 | |||||
Annual distribution before strategic review | Distribution 1 - FY 2018 | ||||||
Related Party Transaction | ||||||
Distributions paid, Per unit | 1.69 | |||||
Annual distribution after strategic review | Distribution 1 - FY 2018 | ||||||
Related Party Transaction | ||||||
Distributions paid, Per unit | $ 1 |
Earnings per Unit (Table) (Deta
Earnings per Unit (Table) (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Earnings Per Share | ||
Partnership's Net Income | $ 5,191 | $ 7,731 |
Less: | ||
Net Income attributable to preferred unitholders | 3,375 | 3,375 |
Net Income attributable to subordinated unitholders | 0 | 1,208 |
General Partner's interest in Net Income | 2 | 38 |
Net income attributable to common unitholders | $ 1,814 | $ 3,110 |
Weighted average number of common units outstanding, basic and diluted | 35,490,000 | 33,585,829 |
Earnings per common unit, basic and diluted | $ 0.05 | $ 0.09 |
Interest and Finance Costs (T52
Interest and Finance Costs (Table) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Finance Costs | ||
Interest expense (Note 5) | $ 22,836 | $ 17,853 |
Amortization and write-off of deferred financing fees | 1,625 | 3,723 |
Other | 165 | 1,042 |
Total | $ 24,626 | $ 22,618 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Thousands | 6 Months Ended | 7 Months Ended | ||
Jul. 02, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | Jul. 19, 2018 | |
Total distributions paid to all classes of unitholders | $ 27,283 | $ 33,429 | ||
Subsequent Event | Distribution 2 - FY 2018 | ||||
Distribution Made To Limited Partner And General Partner Declaration Date | Jul. 2, 2018 | |||
Distributions paid, Per unit | $ 0.25 | |||
Distribution Made To Limited And General Partner Distribution Date | Jul. 19, 2018 | |||
Distribution Made To Limited And General Partner Date Record | Jul. 12, 2018 | |||
Total distributions paid to all classes of unitholders | $ 8,900 | |||
Subsequent Event | Distribution from May 12, 2018 to August 11, 2018 | Series A Preferred | ||||
Distribution Made To Limited Partner And General Partner Declaration Date | Jul. 19, 2018 | |||
Distributions paid, Per unit | $ 0.5625 | |||
Distribution Made To Limited And General Partner Distribution Date | Aug. 13, 2018 | |||
Distribution Made To Limited And General Partner Date Record | Aug. 5, 2018 |