Ted Young - Chief Financial Officer John Hadjipateras - Chief Executive Officer, Dorian LPG Ltd. John Lycouris - Chief Executive Officer, Dorian LPG (USA) LLC

Mike Webber - Wells Fargo Spiro Dounis - UBS Financial Services Erik Nikolai Stavseth - Arctic Securities ASA Colton Bean - Tudor, Pickering, Holt & Co.

Greetings, and welcome to the Dorian LPG’s Second Quarter 2016 Earnings Conference Call. At this time all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Ted Young, Chief Financial Officer for Dorian LPG. Thank you. You may begin.

Thank you, operator. Good morning. Thank you all for joining us for our second quarter 2016 results conference call. With me today are John Hadjipateras, Chairman and CEO of Dorian LPG Limited; and John Lycouris, Chief Executive Officer of Dorian LPG USA. As a reminder, this conference call, webcast, and replay of this call will be available through November 6, 2015. Many of our remarks today contain forward-looking statements based on current expectations. These statements may often be identified with words such as expect, anticipate, believe or similar indications of future expectations. Although we believe that such forward-looking statements are reasonable, we cannot assure you that any forward-looking statements will prove to be correct. These forward-looking statements are subject to known and unknown risks and uncertainties and other factors as well as general economic conditions. Should one or more of these risks or uncertainties materialize or should underlying assumptions or estimates prove incorrect, actual results may vary materially from those we express today. Additionally, let me refer to you to our second quarter 2016 results filed this morning with the SEC on Form 10-Q, where you’ll find risk factors that could cause actual results to differ materially from those forward-looking statements. With that, I’ll turn over the call to John Hadjipateras.

Thanks, Ted. Good morning, all, and thank you for joining as we report our second quarter 2016 financial results. I’ll provide a brief update on our operating performance in Q2 before handing the call over to Ted to review our financials. Ted will then pass the call to John Lycouris to update you on our new building program and for a discussion of the broader market. Since our last call, we have taken delivery of six ships, the Constitution, Commodore, Cresques, Constellation, Clermont, and Cheyenne. We expect to take all, but one of our remaining six deliveries by the end of the calendar year. We now operate a modern fleet of 16 VLGCs and one pressurized LPG carrier with newbuilding contracts for the construction of 6 new fuel efficient eco-designed VLGCs to be delivered in the next three months. We’re upon this in the Helios LPG Pool, where the fleet currently comprises 14 spot VLGCs, including one on a one-year time charter. 10 of which are owned by the company and four owned by Phoenix Tankers; a subsidiary of Mitsui OSK. Outside the pool, we have three VLGCs trading spot in the west and three VLGCs on time charters of more than two years duration. Regarding our ongoing chartering strategy, we will continue to be opportunistic and the strategic employment of our vessels in both the spot and time charter markets. Historically, we have been bias towards time charters. At the same time, we’ve recognized the importance of taking advantage of a strong market and capturing the best possible risk adjusted return on our assets. With the current market continuing to show a strength, we have had more of our fleet in the spot market. We will continue to evaluate the best strategy for the employment of our ships, considering the opportunities we see in the market, and hope to optimize our book charters to provide the best risk adjusted return to our shareholders. For the quarter ended September 30, 2015, our spot VLGC utilization rate was 97.2% and our overall VLGC utilization rate was 98.3%. Finally, in accordance with our previously authorized share repurchase program, the company repurchased about 6 million worth of LPG shares, or 500,000 shares at an average price of a 11.87. The company now has approximately 94 million remaining in its authorization. When the last of our newbuildings has delivered, we will own and operate one of the world’s largest and youngest VLGC fleets measured by number of ships and carrying capacity, and to be best position to take advantage of continuing positive trends in demand. At the end of the calendar year, the company will have almost entirely completed the build-out of its fleet. But now we continue to be in a growth mode, taking delivery of ships on a very regular basis. Our board will continue to consider our dividend policy as we transition from this period of high growth into a period of harvesting cash flows from our ships on the water, and as our cash position builds. I’ll hand the call over to Ted now who will discus our financial results.

Thanks, John. Quarters results reflected a strong freight market, the entry of a number of our newbuildings in the service, and good management of our costs. Before I move onto discuss the results for the year in the quarter, I’d like to point out that our business should be viewed through a long-term lens. As a reminder, we’re affected by the seasonality of the market, and it’s important to understand how the seasonality may affect our quarterly financial results. The LPG shipping market is typically stronger in the spring and summer in preparation for increased consumption of propane and butane for heating during the northern hemisphere winter. For the quarter ended September 30, 2015, we reported total revenues of $74.9 million, representing charter hire and voyage freight revenue earned for VLGCs and our one pressurized vessel. As we initially described last quarter, we report results for the Helios LPG Pool, which commenced its operations on April 1, of this year as part of our total revenues. We report our share of the Helios results as net pool revenues in our income statement, which represents our percentage participation in the pool revenues with pool voyage expenses and pool general and administrative expenses. Net pool revenue for the quarter was $49.3 million. Time charter equipment revenues per day across all of our VLGCs, including those in the Helios Pool amounted nearly $74,000 a day, while our spot VLGCs, again, including those in the pool earned over $88,500 a day for the quarter. Our voyage expenses for the quarter were approximately $3.5 million and mainly related to bunker costs of $1.8 million. While bunker prices remained relatively low in this quarter, we continue to see that we’re getting a benefit from our eco-ships whose speed and consumption continue to perform ahead of expectations. Our vessel operating expenses for the entire fleet were approximately $9.5 million or $8,653 per vessel per calendar day, which again we calculate by dividing vessel operating expenses by the total calendar days for all of our vessels for the relevant time period. Note that, we do not begin recognizing calendar days in our newbuildings until the successful completion of gas trials, which is usually five days following the delivery of the vessel from the yard. Focusing for a moment on our VLGC only vessel operating expenses, we operated these ships at an average cost of $8,860 per day, which included our investment in training officers for our future deliveries in an amount of approximately $650,000 for the quarter. We expect these training costs to ramp down significantly during the quarter ending December 31, 2015, that we have substantially completed this training process. Adjusting for that investment, the daily OpEx for our VLGC is amounted to approximately $8,205 per day, which is a very good result. Depreciation and amortization for the quarter was roughly $8.3 million, and relates mainly to depreciation expense for our operating vessels. General and administrative expenses for the three months ended September 30, 2015 were $5.3 million and were comprised of salary and benefits, stock based comp, and approximately $1.3 million relating to costs associated with opening our newbuildings that delivered during the quarter, principally pre-positioning crews in Korea several weeks in advance the delivery of the vessel. Excluding the non-cash compensation expense, we incurred approximately $4.4 million of cash G&A expense for the quarter. We’ve previously explained that we have built our corporate infrastructure in advance from our vessel deliveries and believe that the vast majority of our people and assets are now in place. To put this in context, we reported 1,092 calendar days for this quarter and we would expect on a fully delivered basis to report approximately 2,099 days for the same quarter. Thus assuming that our G&A is roughly unchanged from this year, G&A per day would decline by roughly half. Our reported interest and finance costs for the quarter just ended was $900,000, which was comprised of interest expense on our debt, amortization of financing costs, another financing expenses of $3.3 million, offset by capitalized interest of $2.4 million. The $6.3 million loss on derivatives was comprised of unrealized loss of $5.1 million from the changes in the fair value of interest rate swaps and a realized loss of $1.2 million. The unrealized loss was principally result of the downward movement in rates from the time that we executed $250 million bullet swaps to the end of our quarter on September 30, 2015. However, since we fixed $250 million of our LIBOR exposure at a weighted average rate of 1.95% to March 2022, we’re not overly troubled by short-term mark-to-market adjustment that we believe will contribute to more stable cash flow over the longer term. In addition, subsequent to quarter end, we completed two amortizing swaps for the total notional value in excess of $214 million at a weighted average rate of approximately 1.4%. In spite of the mark-to-market on the swaps, which totaled $5.1 million, or $0.09 a share, we still reported net income of $41.2 million, or $0.72 a share, which is representative of the growth in our fleet, the strong rate environment, and the good management of our costs. Our adjusted EBITDA, as we define that term in our filings, similarly benefited as we reported $57.7 million for the quarter. We will see those earnings convert into cash in the coming months, particularly those related to emerge, which are the summer longer collection cycle. During the quarter, we also repaid $7.5 million of bank debt under our two bank facilities. At September 30, 2015, we had $405.5 million of remaining payments due under our VLGC newbuilding program and we had 338.6 million available to be drawn under the 2015 facility agreements. We also finished the quarter with $80.3 million in unrestricted cash. During the quarter the company repurchased $4.3 million of stock, which represented over 25% of our free cash flow of $16.9 million, which we define as cash flow from operations, less increases in restricted cash and principal repayments during the quarter. With that I will turn it over to John Lycouris.

Thank you, Ted. As John reported, Dorian LPG has taken delivery of six ECO newbuildings since our last call, and we expect five further vessel deliveries by the end of this calendar quarter. The fleet will increase from the current 16 VLGCs to 21 VLGCs by that time leaving our newbuilding program with one ship remaining to be delivered. All shipping yards have performed in schedule with the respect with vessel deliveries and one of them has overcome the issues related to offshore projects previously indicated. The deliveries of Dorian’s remaining ECO VLGC vessels is on schedule. The deliveries of the six newbuildings this quarter have gone smoothly with our crews, our site and newbuilding teams and all vessels have performed well immediately entering the spot market by the Helios LPG pool. We believe our customers continue to benefit from the competitive advantage of the Dorian LPG ECO VLGCs, and the efficient and smooth integration of this newly delivered vessels into our fleet. I would like to take a moment to touch on our perspective of the worldwide VLGC fleet outlook. The current fleet amounts to just over 180 vessels and the order book projects the fleet to expand to 145 ships by the end of 2016 and over 260 ships by 2017, 2018. Currently 35 of these ships are 20 years or older. Global LPG seaborne export volumes in 2014 amounted to about 64 million tons per annum. For the nine months of 2015, these volumes amount to over 60 million tons and we are likely to exceed over 75 million metric tons for this year. The rough breakdown for delivery in Gulf LPG volumes are expected to be about 35 million tons with another 20 million tons coming from the U.S. Gulf, the East and West Coast in the United States and about 20 million tons coming from Africa in the North Sea. Based on a typical VLGC voyage from production area to the typical end markets the Arabian Gulf requires 2.7 shipped from million tons or roughly 95 ships per year, the U.S. Gulf requires 3.2 ships for million tons, or roughly 64 ships per year, and Africa and Europe require about 1.2 ships or roughly 24 ships a year. The 2015 volumes as they are shaping up, will require the entire 180 vessel VLGC fleet to be fully utilized. With seaborne LPG volumes expected to increase over 80 million tons in 2016, a fleet of 200 vessels will be required against an expected delivered fleet of 210 vessels available that are younger than 20 years of age. With the actual fleet size reduced, due to positioning port delays maintenance breakdowns we can reasonably expect that the available operating fleet will be closer to the 200 ship range, which will suggest continuation of tide ship of liability in markets that underpin trade rates. Finally, we should also consider incremental LPG seaborne volumes that can reasonably be expected in 2016. Some of these volumes will come from Iran once sanctions are lifted and with lightly absorbed ships and some volumes will come from the United States capacity increases of 10 million metric tons expected in 2016, which will require another 30 vessels. These trends give us confidence that the waterborne LPG shipping markets will continue to operate with strong vessel utilization and attaining stock market rates and the LPG markets in general. As we are going into the high demand season for our LPG, the Propane and Butane prices have recovered both in the Arabian Gulf and the U.S. Gulf with Saudi contract pricing rising from the September lows of 315 and 345 to 360 and 365 respectively. In the U.S., we have seen inventories continue to rise in the last few months and LPG prices climbing. Even though this may appear counter intuitive it may be a pre-closer of winter season expectation by traders and export terminals, as well as market backwardation. The Propane and Butane price recovery in the U.S. Gulf is evident against the WTI light crude prices having recently traded 39% and 47% of crude WTI respectively. As mentioned before, U.S. export terminal expansion plans for 2016 anticipate adding a further 10 million metric tons of capacity. We believe that the expert terminal capacity utilization during 2015 has reached very high levels in view of the more than 20 million experts that we anticipate to be reached by the end of this year. In this year, we will see record LPG imports into China, likely to overtake Japanese LPG imports. Major suppliers to China have been Iran with 35% of the volume and the U.S. with 25% share of those imports into that country. A large amount of LPG has been testing to household and feedstock use in China, with India and Indonesia following closely on LPG imports there. To summarize, we continue to see LPG export growth, which will support the fleet to grow and establish LPG as a mainstream fuel and feedstock to the global energy markets and to the world economy. I will pass it over to John Hadjipateras.

Thank you, John, and thank you, Ted. Operator, can you please open for questions?

Thank you. [Operator Instructions] Our first question comes from the line of Mike Webber with Wells Fargo. Please proceed with your question.

Hi, good morning, guys. How are you?

Good morning, Mike.

Good morning. Congratulations.

Thank you very much, appreciate it. Just a hand full of questions, probably pretty similar to what we’ve been talking about the past couple of quarter, but I guess first and foremost I just want to talk a bit about the dynamics you are seeing in the market right now around long term contracts, is it typically whether you have seen any change in terms of the demand for long term contracts and then whether there has been any change in terms of the tender or the interested counter parties.

Do you want to ask the other questions and I will answer them all together.

Well, this is all and the other ones are on different subjects.

Okay. Long term projects the tender and-we actually have not seen any change to be honest. In terms of-from the beginning there was always an opportunistic element in the way traders have approached it and the changes sometimes are sensitive to this spot market, so we’ve seen-when the spot market is falling people are retreating when the spot markets aren’t people are scrambling, but all in all there is continued to be an interest. The counter parties again are, the profile hasn’t changed in terms of the mix between sort of major traders and Chinese end users maybe. So, I wouldn’t say that there is a noteworthy change over the past few months, six to nine months.

Gotcha. Now that’s helpful. We’ve seen a handful of orders recently kind of smaller parcels of vessels that are from ship owners who have not traditionally been in the market and not really up to the needle, but enough – we’ve got our attention. I’m just curious as to whether, when you guys look at 2016 or 2017, maybe relative to what do we talks [ph] during the summer any change to your long-term utilization expectations and then maybe more specifically if you look at the exceedingly tight dynamics we’ve seen this year, you know at some point that’s got to have to ease of at least a bit, next year the question is how much and when, when do you guys foresee any sort of inflexion point, where the global fleet starts to really catch up with demand trends, maybe on a quarter – in the quarter, where you think that we’ll see that inflection point?

It’s a crystal ball question. We already have – the markets already ease off and that – it could be seasonal. There are sort of yield pricing dynamics, and we can’t say that we fully understand the Belvieu pricing. And that’s been hindering the – as you know. So what is certain, of course, is that fleet. Now, the addition to the fleet for the last orders, as you know, they were for Panamax ships, it was interesting, and it was – the owners who took it, what I think did a financial calculation with it so much. They were filling a specific need or specific charterers for protecting a – the routes fearing that the Panama can now – the new Panama can now will be delayed or too busy. So they wanted to have flexibility to be able to go through the old Panamax now. But in terms of saying an inflection point, we see demand, as I – Jojn Lycouris said in his remarks and he can expand a bit more if you like. We see demand as being healthy and very price sensitive. So and we saw spikes this year when the prices went down. So and we’ve seen inventories build, but that cannot be indefinite. We – if you like a little more comment, John can tell you. He is – we’ve analyzed the numbers, we’ve seen what we think our ongoing demand is in terms of regions, and we don’t really think there is a – an imbalance in 2016.

Okay. That’s fair. I did want to follow-up on, I guess, [indiscernible]. You mentioned in the Panama canal and VLGC that they stand today are already, but this largest vessels, I guess, the small vessel that can actually fit through the existing canal and would be the – among the smallest, probably transiting the new canal. Would you guys think about long-term dynamics and how the canal authority prices up that fee structure, when you’re running your internal utilization estimate, what sort of canal usage you guys actually foresee that will extend a reason as you got a 15,000 TEU containership, that’s probably going to be a better business and a smaller asset taking a bandwidth on the canal. Just curious as though how you guys think about that longer-term?

We – we’ve been calculating on a 20% to 30% US Gulf through the canal.

Okay.

The economics – it all depends on the freight rate, right? But the economics are very tied. I expect on the current proposed – currently proposed pricing for the new canal, the economics are very tied. Now, as I remain tied, it could well be as the canal will reprice, because they know how to compete right?

Right.

And so they’re sensitive to those issues, but…

Okay.

…the throughput is not a lot and there is a lot of – we would expect that there would be waiting time and other factors that would mitigate any negative impact of canal transit.

Okay, that’s helpful. And then finally, again, kind of what I’m asking you guys is the main question. You’ve been pretty clear about it for a couple quarters now in terms of when you’re going to look at addressing dividend policy. But I’m just curious quarter-over-quarter some progress, has there been any change in the way you guys have thought about the timing and/or the magnitude? And then if you think about your business today, kind of what the percentage of operating cash flow is that you think you need to keep at a minimum?

Well, we need to keep. Well, last quarter we spent 25% of our free cash flow on a repurchase. And all this, I think everybody will agree, there’s good value there in repurchasing of these prices. Some people suggested that is a good level to think off as a ongoing dividend policy, but – or 25% some people suggested up to 50%. And I’m not – I wouldn’t be opposed to that, but the key consideration that we have and that we repeated is that we will consider once we start accumulating cash. And this is now in the process of happening happily I should say.

Gotcha. Okay. It’s very helpful, guys. Thank you for the time.

Thanks, Mike.

Thank you, and again congratulations.

Thank you, Mike.

Okay. Thank you.

Our next question comes from the line of Spiro Dounis with UBS. Please proceed with your question.

Hey, good morning guys. Thanks for taking the question. Just want to maybe hit on that last topic again and split here as if I could. So I know you said you talked in the past before I guess about 50% to maybe two third percentage of the fleet being on charter. And just wondering how that ties directly with the dividend policy I know you said maybe you consider you just said consider once you have accumulated cash. But in terms of actually coming out and paying one. Is that more aligned with the fact that you got mostly 50% chartered at some point?

It’s a really good question or going forward yes it would be, it would be a consideration I would come in to the equation of what we consider free cash. The more cover we have the more cash flow we would consider to be free to be dividend or used for repurchase. So it definitely would.

Okay. And I guess by my numbers fairly looks like, I guess, only about a quarter of the fleet is chartered, so you I’ll let – for good reason now obviously the spot market has been really strong so hard to leave something like that kind. Just wondering you got six more coming out of the yard would it be your expectation given that you have at least I would imagine the January that those who probably hit the spot market first and maybe chartering would nearly be a consideration till sometime in 2016?

So as of this morning we have now five coming out of the yards, because we took delivery of a ship after we put out our press release so that’s a nice thing to report. What we – I don’t really want to commit to how many ships and when we’ll report on time chart I said we purposely used the word opportunistic, because we’re in discussions even currently on long-term time charters and I don’t want to give a signal to our counter parties that we’re – that we’re there for the taking I think it wouldn’t serve our shareholder interest well for them to – so that our counter parties to know exactly we stand in terms of how keen we’re to conclude and all that. But I think we’ve retained the best the most flexibility in our negotiations.

Okay, yep I definitely can respect that. And then finally Ted, I think this was probably for you just in terms of cost really impressive this quarter came down earlier and more than we thought. Just wondering in terms of run rate here. I think you mentioned 80 roughly 8200 is kind of the adjusted number for VLGCs. Does that number come down as more of the ECO has delivered just wondering what the run rate is there?

Yes, Spiro, it could accept the one thing that we look at the business internally. We actually kind of segment out the vessels, because we’ve noticed and when any ship and I’ll tell you. When the new vessel comes into the fleet there’s some variability month-over-month in terms of what the OpEx is. So as a result we always try to look at longer term trend. So I’d sort of withhold judgment on and until we see some of these ships get more seasoned it’s possible just because mathematically we’re going to have a greater percentage ECO vessels in the fleet. So it is possible, but until we see the newer vessels that have come into the fleet they beat more season than we see some of that early volatility variability I should say in the monthly OpEx will probably would hold judgment, but it is mathematically possible.

Okay. And just last quick one from me. Just in terms VLGCs and the S&P market don’t see a lot changing hands to all that much. Just wondering do you guys see any op there for sale as anyone trying to sell VLGCs and at some point should we see you go to the second hand market maybe next year after your fleet is delivered?

We have it we wanted to report a number of ships on the market five ships older and last it’s one ship on the market. So as far as we’re buying in the second hand market if we were to buy I think we would prefer to buy in the second hand market than order new ships at this point. But it’s not something we’re looking at now, we keep close tabs on it, but we’re not looking at it seriously we’re not going to execute anything in the short-term.

Okay. That’s-thanks a lot guys. Great job on a quarter.

Thank you, Spiro.

Thank you. [Operator Instructions] Our next question comes from the line of Erik Stavseth with Arctic Securities. Please proceed with your question.

Hi, guys. So one probably quick questions from me. First of all you mentioned that you said 3.2 vessels from the U.S. to Asia was that correct or what was that really to do?

Yes, 3.2 vessels from the U.S. for every million tons and that this year that is 2015 I’ll let John have little back and forth with you on this one, because we learned from you Erik.

But I mean our numbers are actually just so there’s more like 4.2 at this point. So I was just curious how you will allow us something you were using…

I go forward I told you we learned from you and also we’re always conservative and John Lycouris will take a bout from him.

Erik we kind of segment the U.S. Gulf exports to about 40% going to Latin America about 28% going to the Continent and there are many going to the Far East. So if you take the weighted average of all these ships that’s how we come up to 3.2 rather than just all the ships going further and further away. So we kind of take away that and balanced approach to the ships that we need

As a projection.

Yes, so as a projection yes correct.

Do you see that number increasing next year or is that fair to assume?

I don’t think it will increase from 3.2, it might decrease to 3, because we’re going to have some count bottleneck now transits as John said before we’re going to expect maybe 20% to 30% of the volumes that go to the Far East might go through the Panama Canal. And as you said that will depend on the total structure and also on the waiting times and the waiting times have been horrendous basically.

Okay, thanks for that. And switching gears a little bit given the results on U.S. LPG demand next year in 2017 I mean LPG trends coming on but right now natural gas has been trading with a one handle and it seems to be not so strong. Do you see a shift from LPG to natural gas as a consequence of the pricing or how do you think about that your LPG demand in general?

U.S. LPG demand or you mean exports from the U.S.

No, I think by the U.S. LPG demand as a consequence of trying to figure out how much soup is available for exports?

I think there will be enough gas to be used domestically and also for exports I think the capacity has been built for exports, but also the PDAs plans are being built in the United States we’ll start using the propane that’s been produced as you know we have abundance of propane in this country and the U.S. including ethane I think the PDAs plans and other crackers will be using a lot more of that cheaper commodity. As you realize LNG is not something that could be used on any crackers like now and the exports I think are going to continue to be very strong we don’t expect a reduction at all in this.

Okay. Thanks a lot and congratulations on the buying the cheapest vessels in the market by buying back your own stock.

Thank you Erik, I also think I just want to add something and I think that one perplexing and element of this has been a build up in the inventory, and why the inventory hasn’t – as a result of the build-up we haven’t seen a reduction in the price. And I think an explanation there could be and this is really John else theory, but and I kind of buy it. That – with a new capacity – with capacity increasing, we are seeing – it’s natural to see an increased normal inventory levels. So that we are – we keep comparing with the inventories – inventory levels of previous years. But we – previous years had a much smaller systemic requirement. So if that is the case and if we are now building up and through the new normal inventory requirement then we should again see hopefully a price pressure, which would create the economics for movements to the east.

It’s an interesting point.

Okay. All right. Thank you.

Thank you. Our next question comes from the line of Colton Bean with Tudor, Pickering, Holt. Please proceed with your question.

Hi, guys. Thanks for taking the question. Maybe one for Ted here. When you’re thinking about the balance of the buyback authorization, is there kind of a general pricing all that you look at for that, or is it more in keeping with that 25% of free cash flow?

I think, Colton, it’s probably sort of a combination of the two. We’re obviously looking at our cash balances daily and our cash collections, and then overlaying with the price. Obviously, when we start seeing the price and the guys who are on the table who all bought stock is seeing the price go down. And so we’ve got decent visibility in our cash flow. So I wouldn’t say, we are weathered to the 25%, but it’s such the imagination. And as I alluded to, we’re getting better cost absorption now, because as these vessels come in the fleet. I mean, again, I pointed out in the last quarter, we roughly have only about half of the total delivered days that we are going to have. And so we expect to see over the coming months and already sort of seeing it is, better cost absorption. Because as we take delivery of these new vessels that are generating cash flow, we’re not increasing the cost that go with that beyond at the vessel level. So it would suggest that we can do more than 25% of our free cash flow as long as we’re feeling good about the outlook and the stock price is at levels that make it accretive to shareholders to rush to buy back the stock.

Okay. And just looking at…

[Multiple Speakers] apart from being expensive at the moment.

I would certainly agree. So looking out into kind of back-half 2016, when we’ve got volumes coming out of market, so coming out of the northeast U.S. for the first time. How do you guys view that impacting the market, maybe specifically in regards to European imports?

Yes. I think that European imports would be benefiting from this closest source of product certainly. And I think it would – we expect that it will start very soon probably this last few months of 2015 into 2016.

Okay. And looking into kind of Q4 2016 when the full expense inside for that, do you think there is any likelihood that Arabian Gulf volumes actually get back to – back out of Europe to an extent there, or is that probably two new vessels?

You mean, our Arabian Gulf volumes go to Europe, or…

In terms of assuming over 200,000 barrels a day coming out of the northeast to the degree that some large majority of that goes to Europe, do you think that will back-out…

No.

…other suppliers there, or?

Most of the volumes in Asia go, I mean, from the Arabian Gulf Coast to Asia anyway, there is no backing out. There is very few volumes, very little volumes. Now they’re just going back into the mad, if that’s what you’re suggesting up north.

Okay. All right. Perfect. That is a great color then. I think, that’s it from me. Thanks, guys.

Thanks, Colton.

Thank you.

Thank you.

Thank you. There are no further questions at this time. Mr. Hadjipateras, I’ll turn the floor back to you for any final remarks.

Thank you very much. Have a good weekend, everybody, and thank you for joining us. And congratulations again to, Mike, and hope to hear you in the next quarter. Thank you. Bye-bye.

Thank you. This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.