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Golar LNG (GLNG) Q1 Loss Wider Than Expected, Revenues Beat

Zacks Equity Research

Golar LNG Limited GLNG incurred a loss (excluding 95 cents from non-recurring items) of 8 cents per share in first-quarter 2020, wider than the Zacks Consensus Estimate of a loss of 2 cents. However, the loss per share narrowed year over year.

Adjusted revenues of $117.7 million surpassed the Zacks Consensus Estimate of $108.6 million. Total operating revenues came in at $122.6 million. The top line also increased year over year, backed by an impressive performance at FLNG and strong seasonal results in shipping. Notably, FLNG Hilli Episeyo maintained its 100% commercial uptime in the quarter under review.

Revenues from vessel and other operations accounted for bulk (55.5%) of the company’s top line. FLNG revenues reflected the balance. Notably, Time and voyage charter revenues declined 19.8% sequentially. Additionally, Time Charter Equivalent (TCE) earnings climbed to $61,900 per day in the quarter under discussion compared with $39,300 in fourth-quarter 2019.

Vessel operating expenses of $30.2 million were flat sequentially. Total administrative expenses decreased 16.8% sequentially to $10.1 million due to lower legal, travel and employee stock compensation costs. Project development expenses increased marginally from fourth-quarter 2019 to $3.7 million.

The company, currently carrying a Zacks Rank #2 (Buy), exited the first quarter with a cash balance of worth $303.4 million of which, $131 million was unrestricted cash. As of Mar 31, 2020, its total debt (current and non-current) was $2.56 billion. Golar LNG anticipates the coronavirus-induced demand weakness to weigh further on LNG prices, thereby causing more U.S. cargo cancellations.

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Performance of Other Transportation Stocks

Gol Linhas Aereas Inteligentes GOL, currently carrying a Zacks Rank #3 (Hold), reported earnings of 20 cents per share (excluding $3.08 from non-recurring items) for first-quarter 2020. The bottom line improved year over year on cost-saving initiatives. However, net operating revenues of $710.9 million missed the Zacks Consensus Estimate of $929.8 million and also declined year over year.

Southwest Airlines LUV, currently a Zacks #3 Ranked player, posted a loss of 15 cents per share (excluding 3 cents from non-recurring items) for the first quarter of 2020, narrower than the Zacks Consensus Estimate of 48 cents. However, in the year-ago quarter, the company delivered earnings of 70 cents per share. The results reflect the coronavirus-triggered drop in passenger demand. Further, operating revenues of $4,234 million lagged the Zacks Consensus Estimate of $4,397 million and also declined 17.8% year over year.

Presently a #3 Ranked player, American Airlines AAL incurred a loss (excluding $2.61 from non-recurring items) of $2.65 per share in first-quarter 2020, comparing unfavorably with the Zacks Consensus Estimate of a loss of $2.16. However, the company reported earnings per share of 52 cents in the year-ago quarter. Results for the first quarter were hurt by coronavirus-led bleak air-travel demand. Moreover, operating revenues of $8,515 million deteriorated 19.6% year over year and also fell short of the Zacks Consensus Estimate of $9,146.7 million.

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