Cool Q2 2025 Earnings Report

Cool EPS Results

• Actual EPS: N/A
• Consensus EPS: $0.13
• Beat/Miss: N/A
• One Year Ago EPS: N/A

Cool Revenue Results

• Actual Revenue: N/A
• Expected Revenue: $81.92 million
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

Cool Announcement Details

• Quarter: Q2 2025
• Date: 8/28/2025
• Time: Before Market Opens
• Conference Call Date: Thursday, August 28, 2025
• Conference Call Time: 8:00AM ET

Cool (NYSE:CLCO) engages in the acquisition, ownership, operation, and chartering of liquefied natural gas carriers (LNGCs). As of December 31, 2023, it owned a fleet of eleven LNGCs, including seven modern tri-fuel diesel electric vessels; two modern 2-stroke and two TFDE vessels; and managed 17 LNGCs and floating storage and regasification units for third parties. The company was founded in 1970 and is based in London, the United Kingdom.

Cool Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Average TCE dipped to $69,900/day in Q2 but adjusted EBITDA rose to $56.5 million, up from $53.4 million in Q1 thanks to deliveries of the Cool Tiger and Gale Saga.
• Positive Sentiment: Charter backlog now covers 50% of operating days through 2027, providing stable revenue visibility despite short-term market volatility.
• Negative Sentiment: Spot market rates for TFDE and Two-Stroke vessels remain below economic breakeven, forcing reliance on long-term contracts and backlog to support earnings.
• Positive Sentiment: LNG supply growth is on track, with U.S. projects like Golden Pass and Louisiana LNG set to lift volumes by 23–39% by 2026–2028, underpinning future ton-mile demand.
• Positive Sentiment: Vessel upgrades for four ships, costing ~$10 million each, install sub-coolers that cut fuel use by up to 30% and earn a $5,000/day premium.

Presentation

[Operator]

Ladies and gentlemen, thank you for standing by, and welcome to The Cool Company Limited Second Quarter twenty twenty five Earnings Conference Call. At this time, all participants are in a listen only mode. Later, we will conduct a question and answer session. Instructions will be given at that time. As a reminder, this conference is being recorded.

[Operator]

With that, I will turn the call over to Mr. Richard, our Chief Executive Officer. Sir, please go ahead.

[Richard Tyrrell, CEO at Cool Company]

Hello, and welcome to CorCo's presentation of the second quarter twenty twenty five. Thank you, Janine, for the introduction. Page three has the quarter at a glance and sets the agenda for what we're going to cover today. We're going to keep it relatively short because of the holiday weekend in The U. S.

[Richard Tyrrell, CEO at Cool Company]

The left column has the quarter's numbers, while on the right side, we provide some level of perspectives on the market and CoolCo. During the presentation, we're going to elaborate on these, covering how rates are slowly recovering, how LNG supply both in the near and longer term is developing, how our backlog of charters provide support while the shipping market balances and lastly, how we are faring with securing employment for our vessels as they roll off charters. Page four has the second quarter highlights. Our average TCE was slightly down at $69,900 per day. Total operating revenue remained steady at $85,500,000 and adjusted EBITDA was up at $56,500,000 versus $53,400,000 in the first quarter.

[Richard Tyrrell, CEO at Cool Company]

As you can see from the EBITDA chart, EBITDA is modestly up year on year. We have the delivery of the Cool Tiger and Gale Saga to thank for that in a market that has otherwise been challenging. We've had to work hard to fix vessels that have rolled up charter, often fixing them multiple times in the spot market at unsatisfactory rates that reflect competition from the glut of ships in the market. While we've been successful in chartering vessels as they come open, our results are very much underpinned by our backlog in this type of environment. Dry docks have also been a feature with their associated costs and off hire days.

[Richard Tyrrell, CEO at Cool Company]

We're close to the end of this cycle after a busy third quarter that John will comment on in more detail. Last but not least, I'd like to highlight that we published our ESG report for 2024 over the summer. Inside, you'll see the progress that we're making in many areas with more to come in 2025 now that we have drydocked and upgraded many of the vessels in the fleet. Please go to the website and download the report if you are interested. Page five includes a reminder of what we noted in last quarter's presentation, including how LNG projects have been getting back on track.

[Richard Tyrrell, CEO at Cool Company]

Golden Pass is a clear example of this. And together with other projects, we see a 2339% increase in LNG supply compared to 2024 volumes by the 2026 and the 2028, respectively. The arrival of new volumes is the primary way in which the LNG market shipping market balances. In addition, we pay close attention to the volumes heading east or the East West arbitrage, as we call it. As of the end of last week, year over year storage stood at 76% compared to the 90% seen at this time last year in 2023 and 2024.

[Richard Tyrrell, CEO at Cool Company]

The reason for the difference is the greater drawdown last winter and the lowest the lower starting points to the selling season. It means that U. S. Supply will continue to flow to Europe for a couple of months yet, which isn't great for ton miles. But I do like the tension for cargoes that it will introduce between the basins.

[Richard Tyrrell, CEO at Cool Company]

Such competition could become highly relevant for the Cool Tiger, a vessel that is trading in the Atlantic spot market. Most significantly this quarter and since the beginning of the year, we've seen a very positive development on the supply side. These include a number of projects reaching commerciality, such as Louisiana LNG, Taixu Pass two and Argentina LNG, and a flurry of positive news flow from other projects. Many of these projects are in The U. S, which is good for shipping given the distances involved.

[Richard Tyrrell, CEO at Cool Company]

Page six puts the supply increase in perspective by comparing LNG supply announcements with previous year's levels. We're only halfway through 2025, and we're already at levels comparable to the last few years. If you annualize, you get to levels not seen since 2019. New projects take at least four years to reach production. As I'm sure you'll agree, it points to a positive future for LNG.

[Richard Tyrrell, CEO at Cool Company]

Turning to shipping and the new builds. What's remarkable about this year so far is how orders have fallen behind the supply curve. This was inevitable given the market and that the new building prices that remain stubbornly high, and it's a signal of a natural balancing that is positive for CorCo's fleet longer term. Another positive for CorCo's fleet is scrapping and idling. Page seven shows how we've reached 10 scrappings of LNG carriers to date in 2025, which isn't that many.

[Richard Tyrrell, CEO at Cool Company]

But to complete the picture, you need to look at idling vessels. The chart on the right shows how the number of idling vessels have taken off in 2025. You always see a base of idle vessels amounting to 15 to 20 in drydock depending on the season, but the current level of idling is many more. Most of these vessels are steam vessels that have come to the end of their initial charters. We've long speculated on what might happen to them once off charter, and this chart answers that question.

[Richard Tyrrell, CEO at Cool Company]

There are two fifteen steam turbine vessels on the water today, of which approximately 50 are idle, leaving another 150 or so set to make way for newer tonnage as they roll off charters over the coming years. In the near term, the idling of older vessels is helping the market find its balance. Some people point to the potential of reactivations, but this won't happen unless the market becomes imbalanced in the other direction because of the costs involved. The immediate market backdrop obviously isn't as good as the macro picture, as shown on Pages eight and nine. Page eight is for TFDEs, where rates remain low despite a gradual recovery over the summer.

[Richard Tyrrell, CEO at Cool Company]

You can see how active we have been in the spot market to maintain our record of close to full employment. Spot fixtures are shown on the left and twelve month term deals are shown on the right. I'd be delighted to see the rate line for 2025 show the same kind of winter seasonality this year rather than falling same kind of winter seasonality in 2025 as seen in 2023 rather than falling away like it did last year. There are a few factors that could make a difference in this regard, but we're still contending with high levels of newbuild deliveries that will weigh on rates. At the end of the day, I'd be happy with a continuation of the gradual improvement in rates that we have seen so far this year.

[Richard Tyrrell, CEO at Cool Company]

The vessels with stars against their names, which are amongst the vessels that we have come open and we're needing to find continued employment for, have benefited to the tune of about 5,000 per day from the LNG upgrades installed during their recent drydocks. And they're trading at levels which are above the line shown for more standard 160,000 cubic meter TFE vessels. Depending on operating profile, these vessels, our LNG E vessels as we call them, save up to 30% in annual fuel consumption and emissions. Other points to highlight on these charts are the fact that Blizzard and ICE are already fixed on spot voyages for when they roll up their long term charters later in September. Unfortunately, this means they come off their elevated rates, but it shows the attractiveness of these vessels in the market, albeit at lower rates.

[Richard Tyrrell, CEO at Cool Company]

To put the lower rates into context, and this is important guidance, we're likely to be down well over $100,000 per day across these two vessels come Q4, depending on how spot rates develop. We saw the effects of Glacier and Husky going on to lower rate deals earlier in the year, and we're fortunate that our backlog provides attrition. As previously reported, Husky is now on a variable charter. This is a charter where we bumped along the minimum levels in the second quarter, which is to say the rates were around $20,000 per day with a $5,000 premium for the LNG upgrades. Moving to the Two Stroke market and the Tiger on Page nine, and you'll see that like some of our TFDE vessels, we've been working hard in the spot market.

[Richard Tyrrell, CEO at Cool Company]

There's more of a pickup on Two Stroke during the quarter, but levels remain unsatisfactory. We need to be patient on the target before fixing long term. The long term market is better than either of these two charts suggest, but it remained very shallow in Q2. Activity has increased over the third quarter with charterers opportunistically picking up cheap tonnage. However, for now, we see option value in having the vessel open even if it comes with a temporary cost of low rates in the spot market.

[Richard Tyrrell, CEO at Cool Company]

So Sarmless continues to weigh on the twelve month market. And what you see on the right hand chart is not reflective of the longer term five, seven, ten, twelve or even longer market that the Tiger will ultimately be targeting. Normally, John does a backlog chart on Page 10, but I'm going to take it this quarter. The portfolio effect is an important way in which we derisk the business. And as you can see from the chart, what this means in terms of firm charters, floating charters and open days.

[Richard Tyrrell, CEO at Cool Company]

We're sensitive to the fact that vessels can open over time and turning the pink open days to blue fixed days is one of the most important parts of the job. We've achieved this in the third quarter, and this is something we aim to continue. Obviously, the current market isn't easy, and we've been grappling with poor rates. But this is where the backlog comes in. And as you can see from the chart, it provides for a healthy foundation when faced with a lull in rates.

[Richard Tyrrell, CEO at Cool Company]

50% of our days are covered until 2027, by which time we anticipate the return of a much more balanced market, of course, with sentiment returning in advance. That's all I had on that page. Have I missed anything, Jon? If not, please go ahead with the quarter in more detail.

[John Boots, CFO at Cool Company]

Thank you, Richard. I will go through the financials for the 2025. Turning to Slide 11. In our Q2 earnings release today, we reported total operating revenues of CHF 85,500,000.0, in line with the prior quarter and above the guidance provided during our last call. Quarter to quarter variations were mainly driven by timing for each charter revenues with Q2 benefiting from fewer drydock days and a full quarter of the Gale Sagar contributions offset by lower average TCEs across the rest of the fleet.

[John Boots, CFO at Cool Company]

Operating results were further supported by the absence of positioning costs following the delivery of the Gelseidar in the first quarter. Fleet wide time and voyage charter revenues translated to an average TCE of $69,900 per day in Q2 versus $70,600 in Q1. The modest decline reflects the Gaelsacar's higher TCE being more than offset by lower rollover rates on open vessels. Adjusted EBITDA for the quarter was €56,500,000 compared to €53,400,000 in Q1, largely reflecting the absence of the voyage related expenses tied to the newbuilds in January, which is a separate line item in the income statement. Adjusted EBITDA excludes 3,700,000 of non cash amortization of intangible assets and liabilities recognized in reported revenues, again often a source of variance versus consensus estimates.

[John Boots, CFO at Cool Company]

For Q3, we anticipate total operating revenues to be at a similar level as Q2. What I'd like to note, as Richard mentioned, that towards the end of the quarter, two vessels will be redelivered from their existing contracts, but each with a first spot voyage already secured. This will obviously impact our average TCE rate going forward as well. Turning to Slide 12. The revenue bridge summarizes the changes quarter over quarter.

[John Boots, CFO at Cool Company]

Operating income on the other hand, on the top right, for Q2 was positively impacted by the voyage expenses, as previously mentioned, And the net income for Q2 of CHF 11,900,000.0 is an increase of CHF 2,800,000.0 versus Q1, which was also impacted by less unrealized interest rate losses on the swaps. The operating margin remained strong at 43% of operating revenues. Turning to Slide 13. With the completion of nine drydocks, four of which included performance upgrades to our existing vessels by installing sub coolers, alongside the addition of two newbuilds, our vessel operating expense per day per vessel continues to trend positively. In the current quarter, average vessel operating expenses were $15,900 per day across the fleet of 13 vessels, a decrease from both Q1 and also from the average 2004 run rate, which was approximately $17,300 per day.

[John Boots, CFO at Cool Company]

Looking ahead, we have two more dry docks planned over the next couple of quarters, and we expect to continue realizing benefits from operational dry dock efficiencies and economies of scale. Moving to slide 14, where I want to spend a little moment on the capital structure and interest rate management. During the second quarter, but also after quarter end, we entered into a significant number of additional interest rate swap agreements. These swaps cover two of our major debt facilities, and they meaningfully reduce our exposure to floating rates. As a result of these hedging actions, our average interest cost now stands at around 5.6%.

[John Boots, CFO at Cool Company]

And importantly, today approximately 75% of our total notional debt is hedged or fixed. But if you adjust for net debt rather than gross debt, that coverage ratio increases further to 82. We believe the additional hedges are a prudent approach, especially given the size and tenure of our facilities, and it provides greater predictability in our cash flows. Finally, on this slide, with interest rates trending downwards, we may see more opportunities to selectively add further swaps on favorable terms. While we might not rush, we will continue to look for opportunities to lower our all in cost of debt and enhance balance sheet efficiency.

[John Boots, CFO at Cool Company]

Moving to Slide 15 on the liquidity. As of June 30, cash and cash equivalents totaled approximately EUR109 million. And you see in the graph the breakdown of how we moved from the end of the first quarter to the end of this quarter. We also have €117,000,000 in undrawn availability under the revolving credit facility that we secured in December 2024. Taking this together with our existing cash, we ended the quarter with total available liquidity of CHF $226,000,000.

[John Boots, CFO at Cool Company]

This strong liquidity provides our fit the flexibility not only to weather volatility in the markets, but also to act opportunistically if the right opportunity arises. Additionally, since April 25, we have repurchased shares under our previously announced buyback program. As of August, we bought back approximately 859,000 shares at an average price of $5.77 per share, well below our net asset value per share, reducing our total share count by 1.6%. Looking ahead, the pace and the size of further repurchases will depend on market conditions and the company's financial position. Turning to Slide 16.

[John Boots, CFO at Cool Company]

Looking ahead here as well, our financial position remains solid, giving us both stability and the flexibility to pursue growth when opportunities arise. Our revenue and operating results underscore the strength of our chartering backlog with adjusted EBITDA margin of 66% and operating margin of 43% of total revenues. Despite more open vessels near term, the fleet is well protected by its backlog against market volatility. On the strategic side, we remain disciplined in looking for asset acquisitions, focusing on transactions that enhance long term value through active management. Finally, given the spot market rates are still below economic breakeven, we continue to manage the business with a prudent long term perspective.

[John Boots, CFO at Cool Company]

So with the financial overview concluded, handing the call back to the operator for questions.

[Richard Tyrrell, CEO at Cool Company]

Thanks, Jeanine. We're ready for questions when you are.

[Operator]

Thank you. Ladies and gentlemen, at this time, we will be conducting a question and answer session. Our first question comes from the line of Alexander Bidwell from Weber Research Advisory. Sir, your line is open.

[Alexander Bidwell, Associate Analyst at Webber Research & Advisory]

Good afternoon, Richard and John. How are you doing?

[Richard Tyrrell, CEO at Cool Company]

Good. Alexander? You.

[Alexander Bidwell, Associate Analyst at Webber Research & Advisory]

Taking a look at some of the recent activity on the liquefaction side, I mean, we've seen over a dozen SBAs signed in the past couple of months, two FIDs in The U. S. Gulf and then The U. S.-EU energy deal. Could you give us a sense of how this recent activity has impacted sentiment within the charter market? And has it prompted any discussions with potential charters?

[Richard Tyrrell, CEO at Cool Company]

Yes, it has. It's early days. And the people who are sort of coming into the market now, I think that's bottom fishing a little bit. But certainly, this positive news flow is starting to get people focused on their long term shipping needs. And course, that's something that we've been waiting for a while now.

[Alexander Bidwell, Associate Analyst at Webber Research & Advisory]

All right. I appreciate the color. And then I wanted to just quickly touch on John, I believe you mentioned potential asset acquisitions. Could you sort of, I guess, walk through any what that may look like or what opportunities you guys might be looking at?

[John Boots, CFO at Cool Company]

No, nothing in particular at this point. We're always looking at acquisitions, whether it's companies and vessels. So it's more a continued effort to look at these opportunities, but nothing concrete.

[Richard Tyrrell, CEO at Cool Company]

And we've got the flexibility there with the RCF to do things. Obviously, we've done things in the past, I think, at the right time, quite some value by doing that. But as Jon said, we're always on the lookout, but nothing to say.

[Alexander Bidwell, Associate Analyst at Webber Research & Advisory]

All right. That makes sense. Thank you, guys. I'll turn it back over.

[Richard Tyrrell, CEO at Cool Company]

Thanks, Alex.

[Operator]

Thank you. Our next question comes from the line of Liam Burke from B. Riley. Sir, your line is open.

[Liam Burke, Managing Director at B. Riley Financial]

Thank you. Hi, Richard. Hi, John. How are you today?

[Richard Tyrrell, CEO at Cool Company]

Good. Thanks, Liam. How are you? Good. Thank you.

[Liam Burke, Managing Director at B. Riley Financial]

Good. Thank you. You highlighted during the year, you have four vessel upgrades. You pointed out you've got a premium for the fixtures on the upgraded vessel. Are you satisfied with the return you're getting on this investment?

[Richard Tyrrell, CEO at Cool Company]

Yes. That's been a pretty good return. Investment was around $10,000,000 So we're going to get the well, at the moment at least, we're getting the $5,000 per day. I think we could potentially get a little bit more than that. I think at the moment, we're kind of sharing the upside, if you like, with the charterers.

[Richard Tyrrell, CEO at Cool Company]

So maybe we can capture more of that going forward. And if you combine those cash flows with the benefits you get from the standpoint of extending the vessel life, you get really quite decent returns on those investments.

[Liam Burke, Managing Director at B. Riley Financial]

Great. And on your drydocking, did you change any of your scheduling based on sort of a weaker chartering environment in anticipation of improvement as we get into 2026?

[Richard Tyrrell, CEO at Cool Company]

Not really. I mean, course, we always drive up in the shoulder seasons, where possible. That's no different from what it would be otherwise. So we are obviously quite pleased to be done with the dry docks. It's quite nice to get some dry docks done when the kind of opportunity cost is relatively low because the rates are low.

[Richard Tyrrell, CEO at Cool Company]

Going forward, now we're nearly through with them all, we're not going to have the off hire days that are associated with dry docks, and that will be helpful.

[Liam Burke, Managing Director at B. Riley Financial]

Great. Thank you, Richard.

[Richard Tyrrell, CEO at Cool Company]

Thanks, Liam. Thank

[Operator]

you. Our next question comes from the line of Frode Markedahl from Clarksons Securities. On

[Frode Morkedal, Senior Equity Analyst at Clarksons Platou Securities]

the prior had Yes. On the prior question question on the LNG E upgrades, maybe you could remind us how far along in the upgrade program you are? How many ships have been completed? How many remain? What's the total CapEx spend?

[Frode Morkedal, Senior Equity Analyst at Clarksons Platou Securities]

And what's remaining? And also on that premium of $5,000 how that's derived, so to speak, if it's a floating

[Richard Tyrrell, CEO at Cool Company]

payment. Yes. Yes, sure. And we're four out of five are completed. So there's one more which will take place in the fourth quarter.

[Richard Tyrrell, CEO at Cool Company]

A lot of the down payments have obviously been made. So there's limited incremental cost on these upgrades. They did cost about 5 sorry, 10,000,000 each for the sub quarters. And the type of deals we've done on them, they fall into two buckets. We have the ones where we do upside sharing with the charterers, which is fundamentally where we have a baseline.

[Richard Tyrrell, CEO at Cool Company]

And to the extent we beat that baseline, we share in the upside. That baseline applies for when the ship is sailing and also for when the ship is stationary and basically waiting or being used to storage. So these upgrades, they do actually provide value whether you're in either of those two modes. And how much of it is how much the total value is depends on the price of LNG. It depends on exactly how the charter achieves to operate the vessels.

[Richard Tyrrell, CEO at Cool Company]

But our guidance on that is the $5,000 per day. So that applies to three of the vessels. And then on the last two vessels, they are the Boreas and the Baltic, which are longer term charters to Shell. We did get paid for the drydocks sorry, for the upgrades on a fixed basis. So that's something which just speaks into the number without any further complexity.

[Frode Morkedal, Senior Equity Analyst at Clarksons Platou Securities]

Okay. That's good color. I had a question on the demand, really. Basically, when do you see the balance shifting from Europe to Asia with more U. S.

[Frode Morkedal, Senior Equity Analyst at Clarksons Platou Securities]

Volumes? When do you think that will start heading east? I guess that's a big difficult question, right? But do you think the inflection is months away or maybe years away?

[Richard Tyrrell, CEO at Cool Company]

I mean, I think you've got two things to look at there. And one is the sort of macro picture that which might be sort of a little bit further out. But then you always have this shorter term volatility. And that is related to various things. It might be outages with leaks in Japan through to the refilling of storage in Europe to just jumping us for whatever reason.

[Richard Tyrrell, CEO at Cool Company]

And those are the types of things which I think mirrors could see vessels heading east. And of course, that would be very positive for tonne miles. The other thing that we do think is supporting the market is the exit of the older steam turbine vessels. And of course, the in a way the worse the market is and has been pretty, pretty bad, the quicker they exit the market and the quicker things find balance. So we're in a sort of period where you've got the pull on one side and you've got the push on the other.

[Richard Tyrrell, CEO at Cool Company]

And well, you can see from how the rates are gradually increasing effect of those things, which ultimately will result in the more balanced market that we're all looking forward to.

[Frode Morkedal, Senior Equity Analyst at Clarksons Platou Securities]

Yes. That's a good point. On the steam turbine ships, how many of these, let's say, 150 remaining that are not idled are actually occupied in the spot market, right? So if you see more ships potentially being idled because rates are low, yes, just like how important are they in the spot market?

[Richard Tyrrell, CEO at Cool Company]

They're not really idled in the spot market. They might be sort of idled or suddenly underutilized within a charterer's fleet. So that's two different things. But either way, you know, once they get to the end, they get to the end of their initial periods, know, that basically they will be idle. They will ultimately become they will ultimately get scratched.

[Richard Tyrrell, CEO at Cool Company]

So, you know, it's something that you do see. I mean, now at the low cost of more modern tonnage, some charters are willing to just lay up a steam turbine vessel while still paying for it because that's cheaper than running that vessel. So I mean, that's something that we see now. And of course, what it means that once the vessel comes to the end of its charter, it means they haven't got any hope of getting any further employment.

[Frode Morkedal, Senior Equity Analyst at Clarksons Platou Securities]

Got it. Thank you.

[Operator]

Our Thank last question comes from the line of Peter Hagen from ABG. Sir, please go ahead.

[Petter Haugen, Equity Research Analyst at ABG Sundal Collier]

Good afternoon, guys. A couple of questions from my side. Is it possible to share some of the some of the factors, some of the metrics within the three year variable charter you announced now. Is there an index plus? And what is the index? Any floors or ceiling in that charter?

[Richard Tyrrell, CEO at Cool Company]

Sure. Happy to, Pedro. Thanks for the question. The it is tied to an index. So I won't go into the details of that, but it will track the charts that you see from brokers for these types of vessels.

[Richard Tyrrell, CEO at Cool Company]

And the floor, excluding the upside from the stuff cooler and the other upgrades, is 20,000,000 and then the ceiling is 100,000,000 plus or minus.

[Petter Haugen, Equity Research Analyst at ABG Sundal Collier]

That's very helpful. Thank you. And I guess adjacent to that, the upside from the upgrades, is it possible for you now to quantify that and also perhaps shed some light on what factors which is making it sort of higher or lower, I suppose, that gas prices itself makes it more valuable to use those upgrades when gas prices are high rather than low, for instance. But just to get a sort of a sense of the magnitude in a dollars per day perspective.

[Richard Tyrrell, CEO at Cool Company]

Sure. We're typically sharing the upside. So we're getting 5,000 a day. The actual upside is $10,000 a day. So that's why I was referring to that earlier suggesting that we maybe could get a little bit more than $5,000 going forward once the charterers appreciate the savings.

[Richard Tyrrell, CEO at Cool Company]

What drives that $10,000 very well? It's two things. One is when the vessel is going below its natural boil off speed, then you run the sub coolers and you avoid sending gas through what we call the GCU, which is where the saving comes from. So that is quite a material saving. And it's quite it's very material in this kind of market, especially when quite often I mean, the vessels are relatively underutilized, right, even if they are on charter.

[Richard Tyrrell, CEO at Cool Company]

You can see that from average vessel speeds and so on. So that's why we've been creating quite decent value there. And that's the one that's one of the factors. The other factor, of course, is, as you mentioned, the price of LNG, which still remains reasonable, I'd say, and obviously quite high in fact by historic standards.

[Petter Haugen, Equity Research Analyst at ABG Sundal Collier]

Okay. That's very helpful again, Richard. Thank you. I guess my final question, and you will have a few other ships now coming off contracts in the side of 2026. And sort of how do you now plan to fix those in terms of, well, the lead time for the fixture?

[Petter Haugen, Equity Research Analyst at ABG Sundal Collier]

And have you potentially already decided that those will, more or less regardless now trade spot unless something dramatic happens to the TC rates?

[Richard Tyrrell, CEO at Cool Company]

Yes. I mean, there's I wouldn't say necessarily about the trading spots, but there's a range of kind of deals you can do. You've got one at the end of the spectrum, you've got spots, you've then got short term, maybe twelve months, maybe eighteen months. And the TRD vessels still very much eligible for that type of business. I'd say in this current market, longer term is very shallow for the CFG.

[Richard Tyrrell, CEO at Cool Company]

So if you're talking three year plus, that's not really a market which exists today. However, of course, for the Two Strokes, it's a different story. And then you have, obviously, the option of doing spot like we're doing at the moment or you have the option of doing something longer term in between. What drives down the spot market a little bit and also the, I'd say, short term market, so let's say, twelve month market, is the fact that those are markets where you have sublets and they end competing with us on those kinds of periods. But when you get to the longer term periods, of course, sublets are generally available for those kinds of terms.

[Richard Tyrrell, CEO at Cool Company]

So when you're talking five year, seven year, ten year, twelve year, whatever the time period might be, the picture is quite different. And I wouldn't say that's a robust picture at the moment, but it's a lot, lot higher than what you see in the spot and the twelve month mix. And it's got a reasonably healthy market, and it's a market where we're seeing quite a lot more inquiries as of the current quarter, even if it was a bit quiet in Q2.

[Petter Haugen, Equity Research Analyst at ABG Sundal Collier]

Okay. That's also interesting. You so much. That was all from me.

[Richard Tyrrell, CEO at Cool Company]

Thanks for the questions, Peter.

[Petter Haugen, Equity Research Analyst at ABG Sundal Collier]

Thank you.

[Operator]

Thank you. This concludes our question and answer session. Thank you for joining the call today. You may now disconnect.

Participants

Executives

• Richard Tyrrell, CEO
• John Boots, CFO

Analysts

• Alexander Bidwell, Associate Analyst at Webber Research & Advisory
• Liam Burke, Managing Director at B. Riley Financial
• Frode Morkedal, Senior Equity Analyst at Clarksons Platou Securities
• Petter Haugen, Equity Research Analyst at ABG Sundal Collier