1. Basis of Presentation and General Information

Dorian LPG Ltd. (“Dorian”) was incorporated on July 1, 2013 under the laws of the Republic of the Marshall Islands and is headquartered in the United States and is engaged in the transportation of liquefied petroleum gas (“LPG”) worldwide through the ownership and operation of LPG tankers. Dorian LPG Ltd. and its subsidiaries (together “we”, “us”, “our”, “DLPG” or the “Company”) is primarily focused on owning and operating very large gas carriers (“VLGCs”), each with a cargo carrying capacity of greater than 80,000 cbm. Following the delivery of the Continental, an ECO-design VLGC, on July 23, 2015, our fleet consists of eleven LPG carriers, including seven fuel-efficient 84,000 cbm ECO-design VLGCs, three 82,000 cbm VLGCs and one pressurized 5,000 cbm vessel. In addition, we have newbuilding contracts for the construction of twelve new fuel-efficient 84,000 cbm ECO-design VLGCs at Hyundai Heavy Industries Co., Ltd. (“Hyundai” or “HHI”), and Daewoo  Shipping and Marine Engineering Ltd. (“Daewoo”), both of which are based in South Korea, with scheduled deliveries between August 2015 and February 2016. We refer to these contracts along with the VLGCs that were delivered between July 2014 and July 2015 as our VLGC Newbuilding Program.

On April 1, 2015, Dorian LPG Ltd. and Phoenix Tankers Pte. Ltd. (“Phoenix”) established Helios LPG Pool LLC, or the Helios Pool, which is a pool of VLGC vessels. We believe that the operation of certain of our VLGCs in this pool will allow us to achieve better market coverage and utilization. Vessels entered into the Helios Pool are commercially managed by Dorian LPG (UK) Ltd., our wholly-owned subsidiary, and Phoenix, a wholly-owned subsidiary of Mitsui OSK Lines Ltd. The members of the Helios Pool share in the net pool income generated by the entire group of vessels in the pool, weighted according to certain technical vessel characteristics, and net pool income (see Note 2) is distributed as time charter hire to each participant. The vessels entered into the Helios Pool may operate either in the spot market, contracts of affreightment, or on time charters of two years’ duration or less.

On May 13, 2014, we completed our initial public offering (the “IPO”) and our shares trade on the New York Stock Exchange under the ticker symbol “LPG”.

The accompanying unaudited condensed consolidated financial statements and related notes (the “Financial Statements”) have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In our opinion, all adjustments, consisting of normal recurring items, necessary for a fair presentation of financial position, operating results and cash flows have been included in the Financial Statements. The Financial Statements should be read in conjunction with the audited consolidated financial statements and related notes for the year ended March 31, 2015 included in our Annual Report on Form 10-K for the year ended March 31, 2015 filed with the Securities and Exchange Commission (“SEC”) on June 4, 2015.

Our quarterly results are subject to seasonal and other fluctuations, and the operating results for any quarter are therefore not necessarily indicative of results that may be otherwise expected for the entire year.

Our subsidiaries as of June 30, 2015, which are all wholly-owned and are incorporated in Republic of the Marshall Islands (unless otherwise noted), are listed below.

Vessel Owning Subsidiaries

Newbuilding Vessel Owning Subsidiaries(3)

Management Subsidiaries

Dormant Subsidiaries

2. Significant Accounting Policies

The same accounting policies have been followed in these unaudited interim condensed consolidated financial statements as were applied in the preparation of our audited financial statements for the year ended March 31, 2015 (see Note 2 of the consolidated financial statements included in our Annual Report on Form 10-K for the year ended March 31, 2015).

Additionally, as of April 1, 2015, we have entered into pooling arrangements. Net pool income for each vessel is determined in accordance with the profit sharing terms specified within the pool agreement. In particular, the pool manager calculates the net pool income using the revenues and voyage expenses of all the pool vessels and the general and administrative expenses of the pool and distributes the net pool income to participants based on:

There are no recent accounting pronouncements, other than those disclosed in our audited financial statements included in our Annual Report on Form 10-K for the year ended March 31, 2015, the adoption of which would have a material effect on our unaudited interim condensed consolidated financial statements in the current period or expected to have an impact on future periods.

3. Transactions with Related Parties

Dorian (Hellas), S.A.

As of July 1, 2014, vessel management services and the associated agreements for our fleet were transferred from Dorian (Hellas), S.A. (“Dorian Hellas,” “DHSA” or the “Manager”) and are now provided through our wholly-owned subsidiaries Dorian LPG (USA) LLC, Dorian LPG (UK) Ltd. and Dorian LPG Management Corp. Subsequent to the transition agreements, Eagle Ocean Transport continues to incur related travel costs for certain transitioned employees as well as office-related costs, for which we reimbursed Eagle Ocean Transport $0.3 million for the three months ended June 30, 2015. Such expenses are reimbursed based on their actual cost. Pursuant to a one year agreement that commenced on July 1, 2014 between Dorian LPG (UK) Ltd. and DHSA, chartering and operational services are provided by Dorian LPG (UK) Ltd. to DHSA. Fees for these services are included in “Other income—related party” in the unaudited condensed consolidated statement of operations included herein and were less than $0.1 million for the three months ended June 30, 2015.

We outsourced the technical and commercial management of our vessels to DHSA, a related party, through June 30, 2014, pursuant to management agreements entered into by each vessel owning subsidiary on July 26, 2013, as amended. In addition, under these management agreements, strategic and financial services had also been outsourced to DHSA. DHSA had entered into agreements with each of Eagle Ocean Transport Inc. (“Eagle Ocean Transport”) and Highbury Shipping Services Limited (“HSSL”), to provide certain of these services on behalf of the vessel owning companies. Management fees incurred related to these agreements are presented as Management fees-related party in the consolidated statement of operations in the relevant period. There were no management fees related to these agreements subsequent to June 30, 2014.

Additionally, a fixed monthly fee of $15,000 per hull was payable to DHSA for pre-delivery services provided during the period from July 29, 2013 until June 30, 2014. Management fees related to the pre-delivery services during the three months ended June 30, 2014 amounted to $0.9 million, which have been capitalized and presented in vessels under construction or vessels, net for vessels that have been delivered, and there were no Management fees related to the pre-delivery services during the three months ended June 30, 2015.

Helios LPG Pool LLC

On April 1, 2015, Dorian LPG Ltd. and Phoenix established the Helios Pool and entered into a pool participation agreement for the purpose of establishing and operating, as charterer, under a time charter to be entered into with owners or disponent owners of VLGCs, a commercial pool of VLGCs whereby revenues and expenses are shared as described in Note 2 above. The Helios Pool has entered into commercial management agreements with each of Dorian LPG (UK) Ltd. and Phoenix as commercial managers and has appointed both commercial managers as the exclusive commercial managers of pool vessels. Fees for services provided by Dorian LPG (UK) Ltd. are included in “Other income—related party” in the unaudited condensed consolidated statement of operations and were $0.4 million for the three months ended June 30, 2015. Refer to Note 10 for net pool income.

4. Deferred Charges, Net

The analysis and movement of deferred charges is presented in the table below:

Financing costs incurred during the three months ended June 30, 2015 relate to a $758 million debt facility that we entered into in March 2015 (the “2015 Debt Facility”). See Note 7 below.

There were no drydockings during the three months ended June 30, 2015.

5. Vessels, Net

The additions for the three months ended June 30, 2015 represent amounts transferred from Vessels under Construction relating to the cost of our newbuildings, the Cougar, the Concorde and the Cobra, which were all delivered to us in June 2015.

Vessels, with a total carrying value of $652.6 million and $416.0 million as of June 30, 2015 and March 31, 2015, respectively, are first-priority mortgaged as collateral for our long-term debt facilities (refer to Note 7 below). No impairment loss was recorded for the periods presented.

6. Vessels Under Construction

Other capitalized expenditures for the three months ended June 30, 2015 represent fees paid to third party vendors of $6.9 million for supervision and other newbuilding pre-delivery costs including engineering and technical support, liaising with the shipyard, and ensuring key suppliers are integrated into the production planning process.

7. Long-term Debt

RBS Loan Facility – refer to Note 11 of the consolidated financial statements included in our 2015 Annual Report on Form 10-K for the year ended March 31, 2015.

2015 Debt Facility – refer to Note 11 of the consolidated financial statements included in our 2015 Annual Report on Form 10-K for the year ended March 31, 2015 for additional information related to the 2015 Debt Facility. In June 2015, we made drawdowns under the 2015 Debt Facility of $127.4 million, including $1.8 million of fees, which was secured by the Cougar, the Concorde and the Cobra and was divided into the four separate tranches. As of June 30, 2015, $549.4 million was available to be drawn under the facility.

Debt Obligations

The table below presents our debt obligations:

8. Stock-Based Compensation Plans

Our stock-based compensation expense was $0.9 million and less than $0.1 million for the three months ended June 30, 2015 and June 30, 2014, respectively, and is included within general and administrative expenses in the unaudited condensed consolidated statements of operations. Unrecognized compensation cost was $15.1 million as of June 30, 2015 and will be recognized over the remaining weighted average life of 4.20 years. For more information on our equity incentive plan, see Note 13 of the consolidated financial statements included in our 2015 Annual Report on Form 10-K for the year ended March 31, 2015.

A summary of the activity of restricted shares awarded under our equity incentive plan as of June 30, 2015 and changes during the three months then ended, is as follows:

9. Revenues

Revenues comprise the following:

Time charter revenue included a profit-sharing element of the time charter agreements of $3.2 million for the three months ended June 30, 2014. There was no profit-sharing element of the time charter agreements for the three months ended June 30, 2015. Other revenues represents income from charterers relating to reimbursement of voyage expenses such as costs for security guards and war risk insurance.

10. Net pool income

Net pool income is based on pool points according to the Helios Pool participation agreement. Our share of gross revenues from the Helios Pool is partially offset by our share of voyage expenses and general and administrative expenses related to the pool. For the three months ended June 30, 2015, net pool income is comprised of $20.3 million of gross revenues, partially offset by $4.5 of voyage expenses and $0.5 million of general and administrative expenses related to the Helios Pool, of which $0.2 million was reimbursable to Dorian LPG (UK) Ltd (see Note 2 above). There was no net pool income for the three months ended June 30, 2014.

11. Financial Instruments and Fair Value Disclosures

Our principal financial assets consist of cash and cash equivalents, amounts due from related parties and trade accounts receivable. Our principal financial liabilities consist of long-term bank loan, interest rate swaps, accounts payable, amounts due to related parties and accrued liabilities.

(a)Concentration of credit risk:  Financial instruments, which may subject us to significant concentrations of credit risk, consist principally of trade accounts receivable, amounts due from related parties, cash and cash equivalents. We limit our credit risk with accounts receivable by performing ongoing credit evaluations of our customers’ financial condition and generally do not require collateral for our trade accounts receivable. We place our cash and cash equivalents, with highly-rated financial institutions.

(b)Interest rate risk:  Our long-term bank loans are based on LIBOR and hence we are exposed to movements thereto. We entered into interest rate swap agreements in order to hedge our variable interest rate exposure related to the RBS Loan Facility. The interest rate swaps effectively convert substantially all of our RBS Loan Facility from a floating to a fixed rate. To hedge our exposure to changes in interest rates we are a party to five floating‑to‑fixed interest rate swaps with RBS. Interest rate swaps are stated at fair value, which is determined using a discounted cash flow approach based on market‑based LIBOR swap yield rates. LIBOR swap rates are observable at commonly quoted intervals for the full terms of the swaps and therefore are considered Level 2 items in accordance with the fair value hierarchy. The fair value of the interest rate swap agreements approximates the amount that we would have to pay for the early termination of the agreements.

(c)Fair value Measurements:  The following table summarizes the bases used to measure the financial assets and liabilities that are carried at fair value on a recurring basis on our balance sheet, which comprise our financial derivatives all of which are considered Level 2 items in accordance with the fair value hierarchy:

The effect of derivative instruments within the unaudited condensed consolidated statement of operations for the periods presented is as follows:

As of June 30, 2015 and March 31, 2015, no fair value measurements for assets or liabilities under Level 1 or Level 3 were recognized in the accompanying consolidated balance sheets. We did not have any other assets or liabilities measured at fair value on a non-recurring basis during the three months ended June 30, 2015.

(d)Book values and fair values of financial instruments:   In addition to the derivatives that we are required to record at fair value on our balance sheet (see (c) above), we have other financial instruments that are carried at historical cost. These financial instruments include trade accounts receivable, amounts due from related parties, cash and cash equivalents, accounts payable, amounts due to related parties and accrued liabilities for which the historical carrying value approximates the fair value due to the short-term nature of these financial instruments. We also have long term bank debt for which we believe the historical carrying value approximates their fair value as the loans bear interest at variable interest rates, being LIBOR, which is observable at commonly quoted intervals for the full terms of the loans, and hence are considered as Level 2 items in accordance with the fair value hierarchy. Cash and cash equivalents and restricted cash are considered Level 1 items.

12. Earnings Per Share (“EPS”)

Basic EPS represents net income attributable to common shareholders divided by the weighted average number of common shares outstanding during the measurement period. Our restricted stock shares include rights to receive dividends that are subject to the risk of forfeiture if service requirements are not satisfied, and as a result, these shares are not considered participating securities and are excluded from the basic weighted-average shares outstanding calculation. Diluted EPS represent net income attributable to common shareholders divided by the weighted average number of common shares outstanding during the measurement period while also giving effect to all potentially dilutive common shares that were outstanding during the period.

The calculations of basic and diluted EPS for the periods presented were as follows:

For the three months ended June 30, 2015 and June 30, 2014, there were 929,000 and 655,000 shares of unvested restricted stock, respectively, excluded from the calculation of diluted EPS because the effect of their inclusion would be anti-dilutive.

13. Commitments and Contingencies

Commitments under Newbuilding Contracts

As of June 30, 2015, we had $671.9 million of commitments under shipbuilding contracts and supervision agreements for thirteen newbuildings. We expect to settle these commitments within the twelve months ended June 30, 2016.

Other

From time to time we expect to be subject to legal proceedings and claims in the ordinary course of business, principally personal injury and property casualty claims. Such claims, even if lacking in merit, could result in the expenditure of significant financial and managerial resources. We are not aware of any claim that is reasonably possible and should be disclosed or probable and for which a provision should be established in the accompanying unaudited interim condensed consolidated financial statements.

14. Subsequent Events

On July 23, 2015, we took delivery of our seventh vessel under the VLGC Newbuilding Program, the Continental, from HHI.

In August 2015, our Board of Directors authorized the repurchase of up to $100 million of our common stock through the period ended December 31, 2016.

Vessel Owning Subsidiaries

Newbuilding Vessel Owning Subsidiaries(3)

Management Subsidiaries

Dormant Subsidiaries