Company: LPG
Filing Date: 2025-01-31
Form Type: 10-Q
Source: 0001596993-25-000013
Chunk: 15

Company: DORIAN LPG LTD.
Filing Date: 2025-01-31
Form: 10-Q
Item: Part I, Item 3Q
Chunk 15
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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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For additional discussion of our exposure to market risk, refer to “Item 7A. Quantitative and Qualitative Disclosures About Market Risk” included in our Annual Report on Form 10-K for the year ended March 31, 2024.

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Interest Rate Risk

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The LPG shipping industry is capital intensive, requiring significant amounts of investment in vessels, vessel upgrades, and vessel maintenance. Much of this investment is provided in the form of long-term debt. One of our debt agreements, as described in Note 7 to our unaudited interim condensed consolidated financial statements, contains interest rates that fluctuate with SOFR. We have entered into interest rate swap agreements to hedge exposure to fluctuations of interest rate risk associated with that debt financing agreement and have hedged $152.0 million of amortizing principal under the 2023 A&R Debt Facility as of December 31, 2024 (corresponding to 80% of the outstanding indebtedness under that agreement) and thus increasing interest rates could adversely impact our future earnings due to additional interest expense on the unhedged portion of that debt. For the 12 months following December 31, 2024, a hypothetical increase or decrease of 20 basis points in the underlying SOFR rates would result in an increase or decrease of our interest expense on all of our non-hedged interest-bearing debt by $0.1 million assuming all other variables are held constant. 

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