STEALTHGAS INC. REPORTS THIRD QUARTER AND NINE MONTHS ENDED SEPTEMBER 30, 2014 FINANCIAL AND OPERATING RESULTS

ATHENS, GREECE, November 21, 2014.  STEALTHGAS INC. (NASDAQ: GASS), a ship-owning company primarily serving the liquefied petroleum gas (LPG) sector of the international shipping industry, announced today its unaudited financial and operating results for the third quarter and nine months ended September 30, 2014. 

Third quarter 2014 Results:

§Revenues for the three months ended September 30, 2014 amounted to $31.2 million, an increase of $1.5 million, or 5%, compared to revenues of $29.7 million for the three months ended September 30, 2013, primarily due to the higher number of vessels in the 2014 period.

§Voyage expenses and vessels’ operating expenses for the three months ended September 30, 2014 were $4.0 million and $12.3 million, respectively, compared to $2.9 million and $9.9 million for the three months ended September 30, 2013. The $1.1 million increase in voyage expenses was primarily due to the higher number of vessels under spot charters in the 2014 period. The $2.4 million increase in vessels’ operating expenses was primarily the result of the increase in the number of vessels operated under time charters in the 2014 period, including two vessels that were added to the fleet and two vessels that came off bareboat charters. Other factors contributing to the increase in operating expenses were the operating of the older vessels in our fleet and the larger portion of our fleet trading in the Latin America/ Caribbean area compared to the 2013 period.

§Drydocking Costs for the three months ended September 30, 2014 were nil as no vessels were drydocked during the period, compared to three vessels that were drydocked during the same period last year at a cost of $1.1 million.

§Depreciation for the three months ended September 30, 2014, was $8.5 million, a $0.7 million increase from $7.8 million for the same period of last year. This increase was due to the additional depreciation for five vessels joining the fleet from the third quarter of last year until the third quarter of 2014. 

§Interest and finance costs for the three months ended September 30, 2014 were $2.4 million compared to $1.9 million for the same period last year, an increase of 26%. The increase in interest and finance costs was mainly due to an increase in commitment costs relating to the financing of the vessels that are currently under construction.

§As a result of the above, the Company had net income for the three months ended September 30, 2014 of $1.6 million, compared to net income of $4.1 million for the three months ended September 30, 2013. The weighted average number of shares for the three months ended September 30, 2014 increased to 41.8 million compared to 32.1 million for the same period of last year, due to the offering of a total of 11.4 million shares in February, May and August of 2014. Earnings per share for the three months ended September 30, 2014 amounted to $0.04 compared to $0.13 for the same period of last year.

 

§Included in the third quarter 2014 results are net losses from interest rate derivative instruments and foreign currency hedging arrangements of $0.4 million. Interest paid on interest rate swap arrangements amounted to $0.6 million, or $0.01 per share and gains from change in fair value of the same interest rate derivative instruments and foreign currency hedging arrangements amounted to $0.2 million. Adjusted net income was $1.5 million or $0.04 per share for the three months ended September 30, 2014 compared to $3.7 million or $0.12 per share for the same period last year.

§EBITDA for the three months ended September 30, 2014 amounted to $13.0 million. Reconciliations of Adjusted Net Income and EBITDA to Net Income and Adjusted EBITDA to Adjusted Net Income are set forth below.

§An average of 44.4 vessels was owned by the Company during the three months ended September 30, 2014, compared to 40.6 vessels for the same period of 2013.  As of today, charter coverage for the fleet is 85% through the end of 2014 and 55% for 2015.

§ As of September 30, 2014, cash and cash equivalents amounted to $124.0 million and total debt to $356.3 million. During the nine months ended September 30, 2014 debt repayments amounted to $31.5 million.

 

Nine months 2014 Results:

 

§Revenues for the nine months ended September 30, 2014, amounted to $97.0 million, an increase of $7.6 million, or 8%, compared to revenues of $89.4 million for the nine months ended September 30, 2013, primarily due to the higher number of vessels in our fleet in the 2014 period.

§Voyage expenses and vessels’ operating expenses for the nine months ended September 30, 2014 were $10.6 million and $33.7 million, respectively, compared to $11.0 million and $26.5 million for the nine months ended September 30, 2013. The $6.8 million net increase in voyage and vessels’ operating expenses was primarily due to the higher number of vessels that operated in the 2014 period and due to the portion of the fleet operating now in the Latin America/Caribbean area, where operating costs are higher.  

§Drydocking Costs for the nine months ended September 30, 2014 were $0.5 million as one of our vessels was drydocked during the period, compared to five vessels that were drydocked during the same period last year at a cost of $2.5 million.

§Depreciation for the nine months ended September 30, 2014, was $25.0 million, a $2.3 million increase from $22.7 million for the same period of last year. This increase was due to the higher number of vessels in our fleet in the 2014 period.

§Income from operations for the nine months ended September 30, 2014 was $21.1 million compared to $21.4 million for the same period last year, a marginal decrease of 1%.

§Interest and finance costs for the nine months ended September 30, 2014 were $7.0 million compared to $5.9 million for the same period last year, an increase of 19%. The increase in interest and finance costs was due to a combination of an increase in commitment costs and larger outstanding loan balances.

§As a result of the above, the Company had net income for the nine months ended September 30, 2014 of $13.9 million, compared to net income of $15.7 million for the nine months ended September 30, 2013. The weighted average number of shares for the nine months ended September 30, 2014 increased to 38.0 million compared to 27.0 million for the same period of last year, due to the offerings of a total of 11.4 million shares in February, May and August of 2014. Earnings per share for the nine months ended September 30, 2014 amounted to $0.37 compared to $0.58 for the same period of last year.

§Included in the first nine months of 2014 results are net losses from interest rate derivative instruments and foreign currency hedging arrangements of $0.5 million. Interest paid on interest rate swap arrangements amounted to $1.6 million, or $0.04 per share and gains from change in fair value of the interest rate derivative instruments and foreign currency hedging arrangements amounted to $1.05 million. Adjusted net income was $13.1 million or $0.34 per share for the nine months ended September 30, 2014 compared to $13.5 million or $0.50 per share for the same period last year.

§EBITDA for the nine months ended September 30, 2014 amounted to $47.1 million. Reconciliations of Adjusted Net Income and EBITDA to Net Income and Adjusted EBITDA to Adjusted Net Income are set forth below.

An average of 43.3 vessels were owned by the Company during the nine months ended September 30, 2014, compared to 38.6 vessels for the same period of 2013.

 

CEO Harry Vafias commented

As expected, during the third quarter we faced the same seasonal variations that we did during the second quarter.  Lower heating requirements in Europe, combined with numerous refinery closures in the Far East for maintenance or upgrades were announced. On top of this, warmer weather in the areas we operate brought rates for the quarter indeed weaker than anticipated.

 

Although the total voyage days of our fleet are 85 pct covered for the remainder of 2014, and there is healthy demand for modern vessels, the market for older vessels operating in the spot market was weaker and compared to the previous quarter we had more vessels in the spot market.

 

The industry fundamentals remain positive and we continue to focus on taking delivery of our new generation eco newbuildings from the world’s best yards, while renewing our efforts in keeping our running costs suppressed.

Our strong balance sheet with just 36% total debt to capital and $124 million in cash, as well as $224 million in contracted revenues, strongly supports the company’s future prosperity.

Last but not least we note that our common shares are currently trading at nearly 50 pct discount to our assessed NAV.

 

 

Conference Call details:

 

On November 21st, 2014 at 11:00 am ET, the company’s management will host a conference call to discuss the results and the company’s operations and outlook.

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1877 280 1254 (US Toll Free Dial In) or : 0800 279 5735 (UK Toll Free Dial In) Access Code: 5352288.

In case of any problems with the above numbers, please dial +1646 254 3360 (US Toll Dial In), or:   +44(0)20 3427 1918 (Standard International Dial In). Access Code:  5352288.

A telephonic replay of the conference call will be available until November 28th, 2014 by dialing +1 347 366 9565 (US Local Dial In), +44 (0)20 3427 0598 (UK Local Dial In). Access Code: 5352288          

 Slides and audio webcast:

There will also be a live and then archived webcast of the conference call, through the STEALTHGAS INC. website (www.stealthgas.com). Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

About STEALTHGAS INC.

Headquartered in Athens, Greece, StealthGas Inc. is a ship-owning company primarily serving the liquefied petroleum gas (LPG) sector of the international shipping industry. StealthGas Inc. currently has a fleet of 43 LPG carriers with a total capacity of 209,541 cubic meters (cbm), three M.R. product tankers and one Aframax oil tanker with a total capacity of 255,804 deadweight tons (dwt). The Company has agreed to acquire 16 LPG carriers with expected deliveries ranging from 2015 to 2017. Giving effect to the delivery of these acquisitions, StealthGas Inc.’s LPG fleet will be composed of 59 LPG carriers with a total capacity of 360,241 cubic meters (cbm). StealthGas Inc.’s shares are listed on the NASDAQ Global Select Market and trade under the symbol “GASS”.

Forward-Looking Statements

Matters discussed in this release may constitute forward-looking statements. Forward-looking statements reflect our current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management’s examination of historical operating trends, data contained in our records and other data available from third parties. Although STEALTHGAS INC. believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, STEALTHGAS INC. cannot assure you that it will achieve or accomplish these expectations, beliefs or projections. Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies and currencies, general market conditions, including changes in charter hire rates and vessel values, charter counterparty performance, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled dry dockings, changes in STEALTHGAS INC’s operating expenses, including bunker prices, dry-docking and insurance costs, ability to obtain financing and comply with covenants in our financing arrangements, or actions taken by regulatory authorities, potential liability from pending or future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists.

Risks and uncertainties are further described in reports filed by STEALTHGAS INC. with the U.S. Securities and Exchange Commission.

Fleet List and Fleet Deployment

For information on our fleet and further information:

Visit our website at www.stealthgas.com

Company Contact:

Stavros Papantonopoulos

Financial Manager

STEALTHGAS INC.

011-30-210-6250-001
E-mail:
This email address is being protected from spambots. You need JavaScript enabled to view it.

 

Fleet Data:

The following key indicators highlight the Company’s operating performance during the third quarters and nine months ended September 30, 2013 and September 30, 2014.

 

FLEET DATA Q3 2013 Q3 2014 9M 2013 9M 2014
Average number of vessels (1) 40.6 44.4 38.6 43.3
Period end number of vessels in fleet 42 47 42 47
Total calendar days for fleet (2) 3,735 4,088 10,535 11,812
Total voyage days for fleet (3) 3,665 4,062 10,376 11,714
Fleet utilization (4) 98.1% 99.4% 98.5% 99.2%
Total charter days for fleet (5) 3,025 3,297 8,531 10,068
Total spot market days for fleet (6) 640 765 1,845 1,646
Fleet operational utilization (7) 87.0% 88.6% 91.4% 92.9%

 

 

1) Average number of vessels is the number of vessels that constituted our fleet for the relevant period, as measured by the sum of the number of days each vessel was a part of our fleet during the period divided by the number of calendar days in that period.

2) Total calendar days are the total days the vessels were in our possession for the relevant period including off-hire days associated with major repairs, drydockings or special or intermediate surveys.

3) Total voyage days for fleet reflect the total days the vessels were in our possession for the relevant period net of off-hire days associated with major repairs, drydockings or special or intermediate surveys.

4) Fleet utilization is the percentage of time that our vessels were available for revenue generating voyage days, and is determined by dividing voyage days by fleet calendar days for the relevant period.

5) Total charter days for fleet are the number of voyage days the vessels in our fleet operated on time or bareboat charters for the relevant period.

6) Total spot market charter days for fleet are the number of voyage days the vessels in our fleet operated on spot market charters for the relevant period.

7) Fleet operational utilization is the percentage of time that our vessels generated revenue, and is determined by dividing voyage days (excluding commercially idle days) by fleet calendar days for the relevant period.

Reconciliation of Adjusted Net Income, EBITDA, adjusted EBITDA and adjusted EPS:

EBITDA represents net income before interest, income tax expense, depreciation and amortization. Adjusted EBITDA represents EBITDA before (gain)/loss on sale of assets, impairment loss, loss on derivatives, excluding swap interest paid, and non-cash foreign exchange difference. EBITDA, adjusted EBITDA, adjusted net income and adjusted EPS are not recognized measurements under U.S. GAAP. Our calculation of EBITDA, adjusted EBITDA, adjusted net income and adjusted EPS may not be comparable to that reported by other companies in the shipping or other industries.  In evaluating Adjusted EBITDA and Adjusted Net Income, you should be aware that in the future we may incur expenses that are the same as  or similar to some of the adjustments in this presentation.

 

EBITDA, adjusted EBITDA, adjusted net income and adjusted EPS are included herein because they are a basis, upon which we assess our financial performance. They allow us to present our performance from period to period on a comparable basis and provide additional information on fleet operational results. We also use EBITDA to assess our liquidity position and believe it represents useful information for investors regarding a company's ability to service and/or incur indebtedness. 

 

 

(Expressed in United States Dollars,
except number of shares)
Third Quarter Ended September 30th, Nine Months Period Ended September 30th,
  2013 2014 2013 2014
Net Income - Adjusted Net Income        
Net income 4,146,514 1,570,937 15,685,097 13,873,453
(Gain) / Loss on derivatives 153,989 381,990 (64,611) 524,595
Less swap interest paid (655,066) (557,940) (2,366,466) (1,571,893)
Unrealized exchange (gain)/loss (18,722) 9,000 (10,694) 7,864
Share based compensation 73,758 73,758 218,870 218,870
Adjusted Net Income 3,700,473 1,477,745 13,462,196 13,052,889
         
Net income - EBITDA        
Net income 4,146,514 1,570,937 15,685,097 13,873,453
Plus interest and finance costs incl. Swap interest paid 2,534,304 2,971,491 8,299,090 8,620,268
Less interest income (83,059) (90,923) (203,666) (343,330)
Plus depreciation 7,848,186 8,535,915 22,671,019 24,985,115
EBITDA 14,445,945 12,987,420 46,451,540 47,135,506
         
Adjusted Net income -Adjusted  EBITDA        
Adjusted Net Income 3,700,473 1,477,745 13,462,196 13,052,889
Plus interest and finance costs incl. Swap interest paid 2,534,304 2,971,491 8,299,090 8,620,268
Less interest income (83,059) (90,923) (203,666) (343,330)
Plus depreciation 7,848,186 8,535,915 22,671,019 24,985,115
Adjusted EBITDA 13,999,904 12,894,228 44,228,639 46,314,942
         
EPS - Adjusted EPS        
Net income 4,146,514 1,570,937 15,685,097 13,873,453
Adjusted net income 3,700,473 1,477,745 13,462,196 13,052,889
Weighted average number of shares 32,052,568 41,830,308 26,997,623 37,971,328
EPS - Basic and Diluted 0.13 0.04 0.58 0.37
Adjusted EPS 0.12 0.04 0.50 0.34

 

 

StealthGas Inc.

Unaudited Consolidated Statements of Income

(Expressed in United States Dollars, except number of shares)

          Quarters Ended September 30,   Nine Month Periods Ended September 30,
          2013   2014   2013   2014
                 
Revenues                    
  Revenues     27,272,345   28,766,481   82,108,144   89,640,880
  Revenues - related party   2,465,350   2,465,350   7,340,891   7,340,891
Total revenues     29,737,695   31,231,831   89,449,035   96,981,771
                       
Expenses                    
  Voyage expenses     2,544,920   3,626,015   9,894,145   9,392,495
  Voyage expenses - related party   350,564   385,075   1,089,651   1,190,922
  Vessels' operating expenses   8,826,188   11,301,387   23,447,417   30,614,508
  Vessels' operating expenses - related party 1,025,556   1,044,890   3,066,316   3,061,344
  Drydocking costs     1,086,398   --   2,456,614   465,681
  Management fees - related party   1,272,055   1,394,930   3,502,450   3,995,345
  General and administrative expenses   651,346   692,797   1,892,747   2,186,217
  Depreciation     7,848,186   8,535,915   22,671,019   24,985,115
Total expenses     23,605,213   26,981,009   68,020,359   75,891,627
                       
Income from operations   6,132,482   4,250,822   21,428,676   21,090,144
                       
Other (expenses)/income                
  Interest and finance costs   (1,879,238)   (2,413,551)   (5,932,624)   (7,048,375)
  Loss/(gain) on derivatives     (153,989)   (381,990)   64,611   (524,595)
  Interest income     83,059   90,923   203,666   343,330
  Foreign exchange gain/(loss)   (35,800)   24,733   (79,232)   12,949
Other expenses, net     (1,985,968)   (2,679,885)   (5,743,579)   (7,216,691)
                       
Net income     4,146,514   1,570,937   15,685,097   13,873,453
                       
Earnings per share                  
- Basic       0.13   0.04   0.58   0.37
- Diluted       0.13   0.04   0.58   0.37
                       
Weighted average number of shares              
-Basic       32,052,568   41,830,308   26,997,623   37,971,328
-Diluted       32,052,568   41,830,308   26,997,623   37,971,328

 

 

 

StealthGas Inc.

Unaudited Consolidated Balance Sheets

(Expressed in United States Dollars)

            December 31,   September 30,
            2013   2014
                 
Assets              
Current assets            
  Cash and cash equivalents     86,218,517   124,010,953
  Receivables from related party     104,476     --
  Trade and other receivables     4,726,758   3,712,517
  Claims receivable       136,867   55,217
  Inventories       2,461,093   2,907,432
  Advances and prepayments     715,444   640,074
  Restricted cash       3,521,902   4,760,130
Total current assets       97,885,057   136,086,323
                 
Non current assets            
  Advances for vessels under construction and acquisitions   70,577,435   86,123,429
  Vessels, net       677,022,902   753,400,867
  Other receivables       582,765   228,494
  Restricted cash       2,300,000   2,700,000
  Deferred finance charges, net of accumulated        
     amortization of $2,212,091 and $2,664,236   2,616,584   3,295,114
Total non current assets     753,099,686   845,747,904
Total assets       850,984,743   981,834,227
                 
Liabilities and Stockholders' Equity          
Current liabilities            
  Payable to related party     5,941,043   4,995,976
  Trade accounts payable     7,220,862   8,960,261
  Accrued liabilities       2,880,377   4,087,591
  Deferred income       5,487,585   5,276,966
  Fair value of derivatives     277,212   196,310
  Current portion of long-term debt     41,263,165   45,010,713
Total current liabilities       63,070,244   68,527,817
                 
Non current liabilities            
  Fair value of derivatives     2,955,755   2,134,273
  Deferred income     758,844   1,064,393
  Long-term debt       311,605,457   311,263,214
Total non current liabilities     315,320,056   314,461,880
Total liabilities       378,390,300   382,989,697
                 
Commitments and contingencies          
                 
Stockholders' equity            
  Capital stock       321,273   435,020
  Additional paid-in capital     385,088,821   497,496,622
  Retained earnings       87,233,820   101,107,273
  Accumulated other comprehensive loss   (49,471)   (194,385)
Total stockholders' equity     472,594,443   598,844,530
Total liabilities and stockholders' equity   850,984,743   981,834,227
                         

StealthGas Inc.
Unaudited Consolidated Statements of Cash Flows

(Expressed in United States Dollars)

            Nine Month Periods Ended September 30,
            2013   2014
           
Cash flows from operating activities          
  Net income for the period     15,685,097   13,873,453
                 
Adjustments to reconcile net income to net cash        
  provided by operating activities:          
  Depreciation       22,671,019   24,985,115
  Amortization of deferred finance charges   321,524   452,145
  Unrealized exchange differences     (10,694)   7,864
  Share based compensation     218,870   218,870
  Change in fair value of derivatives     (2,431,077)   (1,047,298)
                 
Changes in operating assets and liabilities:        
  (Increase)/decrease in          
  Trade and other receivables     (716,104)   1,368,512
  Claims receivable       (1,922,975)   (116,761)
  Inventories       (189,424)   (446,339)
  Advances and prepayments     (267,479)   75,370
  Increase/(decrease) in          
  Balances with related parties     559,015   (840,591)
  Trade accounts payable     1,013,901   1,739,399
  Accrued liabilities       604,205   1,207,214
  Deferred income       610,341   94,930
Net cash provided by operating activities   36,146,219   41,571,883
                 
Cash flows from investing activities          
  Insurance proceeds       207,314   198,411
  Vessels’ acquisitions and advances for vessels under construction   (100,112,087)   (126,953,873)
  Net proceeds related to cancellation of vessels’ acquisitions   --   10,044,799
  Increase in restricted cash account   (324,913)   (1,638,228)
Net cash used in investing activities   (100,229,686)   (118,348,891)
                 
Cash flows from financing activities          
  Net proceeds from common stock issuance     109,183,623   112,302,678
  Deferred finance charges     (442,030)   (1,130,675)
  Customer deposits paid     (280,000)   --
  Loan repayments       (27,567,623)   (31,498,388)
  Proceeds from long-term debt     36,762,500   34,903,693
Net cash provided by financing activities   117,656,470   114,577,308
                 
Effect of exchange rate changes on cash   10,694   (7,864)
                 
Net increase in cash and cash equivalents   53,583,697   37,792,436
Cash and cash equivalents at beginning of year   42,273,000   86,218,517
Cash and cash equivalents at end of period   95,856,697   124,010,953
StealthGas Inc.
2nd Quarter 2017 Results
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The webcast is scheduled for:
Thursday, August 24, 2017,
5:00 pm CEST / 11:00 am EDT