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STEALTHGAS INC. Reports Third Quarter and Nine Months 2013 Financial and Operating Results

ATHENS, Greece, Nov. 22, 2013 (GLOBE NEWSWIRE) -- 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, 2013.

Third Quarter 2013 Results:

  • Revenues for the three months ended September 30, 2013 amounted to $29.7 million, a decrease of $0.7 million, or 2.3%, compared to revenues of $30.4 million for the three months ended September 30, 2012, primarily due to the observed seasonal softness in the spot market, which coincided with the expiration of employment contracts relating to the older vessels in the fleet. In this environment, those vessels' transition period to rehire entailed increased repositioning time and decreased overall utilization which was partly offset by the revenues earned by the additional vessels which commenced operation during 2013.
  • Voyage expenses and vessels' operating expenses for the three months ended September 30, 2013 were $2.9 million and $9.9 million, respectively, compared to $3.5 million and $7.7 million for the three months ended September 30, 2012. The $0.6 million decrease in voyage expenses was primarily due to the lower utilization for vessels under spot charters in the 2013 period. The $2.2 million increase in operating expenses was primarily the result of the increase in the number of vessels operated under time charters in the 2013 period, including both the vessels that were added to the fleet and two vessels that came off bareboat charters.
  • Drydocking Costs for the three months ended September 30, 2013 were $1.1 million compared to $0.3 million for the same period last year. During the three months ended September 30, 2013, one vessel entered and completed drydock and two more vessels that had entered drydock late in the second quarter completed their drydocking during the third quarter. In the same period in 2012 only one vessel was drydocked.
  • Depreciation for the three months ended September 30, 2013, was $7.8 million, a $0.5 million increase from $7.3 million for the same period of last year. This increase was due to the additional depreciation for five vessels that joined the fleet during 2013.
  • Interest and finance costs for the three months ended September 30, 2013 were $1.9 million compared to $2.5 million for the same period last year. The reduction in interest and finance cost was due to a combination of lower interest rates and lower outstanding loan balances.
  • As a result of the above, the Company had net income for the three months ended September 30, 2013 of $4.2 million, compared to net income of $6.6 million for the three months ended September 30, 2012. The weighted average number of shares outstanding for the three months ended September 30, 2013 increased to 32.1 million compared to 20.6 million for the same period of last year, due to the public offering of 11.5 million shares completed on April 30, 2013. Earnings per share on a basic and diluted basis for the three months ended September 30, 2013 amounted to $0.13 compared to $0.32 for the same period of last year.
  • Included in the third quarter 2013 results are net losses from interest rate derivative instruments of $0.2 million. Interest paid on interest rate swap arrangements amounted to $0.7 million, or $0.02 per share, and net gains from change in fair value of the same arrangements amounted to $0.5 million. Adjusted net income was $3.7 million or $0.12 per share for the three months ended September 30, 2013 compared to $5.8 million or $0.28 per share for the same period last year.
  • EBITDA for the three months ended September 30, 2013 amounted to $14.5 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 40.6 vessels were owned by the Company during the three months ended September 30, 2013, compared to 37.0 vessels for the same period of 2012.

Nine months 2013 Results:

  • Revenues for the nine months ended September 30, 2013 amounted to $89.5 million, an increase of $0.9 million, or 1.0%, compared to revenues of $88.6 million for the nine months ended September 30, 2012, primarily due to the higher number of vessels in the 2013 period.
  • Voyage expenses and vessels' operating expenses for the nine months ended September 30, 2013 were $11.0 million and $26.5 million, respectively, compared to $8.8 million and $22.9 million for the nine months ended September 30, 2012. The $2.2 million, increase in voyage expenses was primarily due to the higher number of vessels under spot charters in the 2013 period. The $3.6 million increase in operating expenses was primarily due to the higher number of vessels in the fleet, as five new vessels were added and two more vessels came off bareboat charters, that were operated under time charters during 2013.
  • Drydocking Costs for the nine months ended September 30, 2013 were $2.5 million as five vessels were drydocked during the period, compared to five vessels being drydocked during the same period last year at a cost of $2.1 million.
  • Depreciation for the nine months ended September 30, 2013 was $22.7 million, a $1.3 million increase from $21.4 million for the same period of last year. This increase was due to the higher average number of vessels in our fleet in the 2013 period.
  • Interest and finance costs for the nine months ended September 30, 2013 were $5.9 million compared to $7.3 million for the same period last year. The reduction in interest and finance cost was due to a combination of lower interest rates and lower outstanding loan balances.
  • No vessel sales took place during the nine months ended September 30, 2013 while for the same period in 2012 a $1.4 million gain on sale of vessels was reported.
  • As a result of the above, the Company had net income for the nine months ended September 30, 2013 of $15.7 million, compared to net income of $21.2 million for the nine months ended September 30, 2012. The weighted average number of shares outstanding for the nine months ended September 30, 2013 increased to 27.0 million compared to 20.6 million for the same period of last year, due to the public offering of 11.5 million shares completed on April 30, 2013. Earnings per share on a basic and diluted basis for the nine months ended September 30, 2013 amounted to $0.58 compared to $1.03 for the same period of last year.
  • Included in the results for the nine-month period ended September 30, 2013 are net gains from interest rate derivative instruments of $0.1 million. Interest paid on interest rate swap arrangements amounted to $2.4 million, or $0.09 per share and net gains from change in fair value of the same arrangements amounted to $2.4 million. Adjusted net income was $13.5 million or $0.50 per share for the nine months ended September 30, 2013 compared to $17.5 million or $0.85 per share for the same period last year.
  • EBITDA for the nine months ended September 30, 2013 amounted to $46.5 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 38.6 vessels were owned by the Company during the nine months ended September 30, 2013, compared to 36.8 vessels for the same period of 2012.

As of September 30, 2013, cash and cash equivalents amounted to $96.5 million and total debt to $354.5 million. During the nine months ended September 30, 2013 debt repayments amounted to $27.6 million.

Chartering Update

The Company has concluded the following chartering arrangements:

A three year time charter for its 7,200cbm, 2001 built, LPG carrier, Gas Premiership, until October 2016.

A six month time charter extension for its 3,211cbm, 1990 built, LPG carrier, Gas Crystal, until April 2014.

A one year time charter extension for its 3,434cbm, 1991 built, LPG carrier, Gas Ice, until January 2015.

A one year time charter for its 4,109cbm, 1991 built, LPG carrier, Gas Kaizen, starting upon the expiration of its current charter April 2014.

A three month time charter extension for its 3,434cbm, 1992 built, LPG carrier, Gas Arctic, until April 2014.

A one year time charter for its 5,000cbm, 1994 built, LPG carrier, Gas Emperor, starting upon the expiration of its current charter January 2014.

Four vessels are currently operating in the spot market. As of today, charter coverage for the fleet is 90% through the end of 2013 and 64% for 2014.

CEO Harry Vafias commented

As expected, during the third quarter we faced the same seasonal variations that we did during the second quarter. Although we found new charters for some of the vessels that had come off their charters we were left with five of our older vessels operating in a seasonally weak summer spot market thus reducing our overall utilization. In addition, there were increased costs for the vessels that were drydocked during this summer due to their trading areas and the technical issues involved. With the summer now behind us we have started seeing the market strengthening. As a result we have fixed some of our oldest vessels on time charters like the Gas Kaizen initially on a six month charter then back to back on another charter for one more year, the Gas Crystal that we extended for six months, the Gas Ice that we also extended for one year, the Gas Arctic that we extended for three months and the Gas Emperor that we chartered for one year. This increased interest for the chartering of the older vessels should be viewed as a positive sign for the fifteen modern vessels that will be joining our fleet over the next twenty one months. Modern vessels are in higher demand and can command higher day rates than their older counterparts. We remain optimistic about the core strategy of the company that is investing in modern vessels to grow and renew the fleet. The industry fundamentals remain positive and depict an increase in LPG trade over the next two years. The interest we have seen so far from international lenders to finance the acquisitions of these LPG vessels lead us to believe that we will soon have reached agreements for all fifteen vessels. We are now focusing on concluding these finance arrangements that will enable us to prudently allocate more funds for the further growth of our fleet.

Conference Call details:

On November 22, 2013 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: 1866 682 8490 (US Toll Free Dial In) or 0844 571 8957 (UK Toll Free Dial In).

In case of any problems with the above numbers, please dial +1 631 621 5256 (US Toll Dial In), or +44 (0)1452 555 131 (Standard International Dial In). Access Code: 11494350.

A telephonic replay of the conference call will be available until November 29, 2013 by dialing 1866 247 4222 (US Toll Free Dial In), 0800 953 1533 (UK Toll Free Dial In) or +44 (0)1452 5500 00 (Standard International Dial In). Access Code: 11494350#

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.

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 38 LPG carriers with a total capacity of 182,322 cubic meters, three medium range product tankers and one Aframax oil tanker with a total capacity of 255,804 deadweight tons. The Company has agreed to acquire fifteen LPG carriers, with expected deliveries in 2014 and 2015. Once the acquisition of the fifteen LPG carriers is completed and the vessels are delivered, StealthGas Inc.'s LPG carrier fleet will be composed of 53 LPG carriers with a total capacity of 257,922 cubic meters. 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. Assumptions, expectations, projections, intentions and beliefs about future events may, and often do, vary from actual results and these differences can be material. There are a variety of factors, many of which are beyond our control, which affect our operations, performance, business strategy and results and could cause actual reported results and performance to differ materially from the performance and expectations expressed in these forward-looking statements. 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

Fleet Data:

The following key indicators highlight the Company's operating performance during the third quarters and nine months ended September 30, 2012 and September 30, 2013.

FLEET DATA Q3 2012 Q3 2013 9M 2012 9M 2013
Average number of vessels (1) 37.0 40.6 36.8 38.6
Period end number of vessels in fleet 37 42 37 42
Total calendar days for fleet (2) 3,404 3,735 10,090 10,535
Total voyage days for fleet (3) 3,388 3,665 9,941 10,376
Fleet utilization (4) 99.5% 98.1% 98.5% 98.5%
Total charter days for fleet (5) 2,883 3,025 8,714 8,531
Total spot market days for fleet (6) 505 640 1,227 1,845
Fleet operational utilization (7) 95.7% 87.0% 95.3% 91.4%

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:

Adjusted Net Income represents Net Income before (gain)/loss on sale of assets, loss on derivatives, excluding swap interest paid, share based compensation and unrealized exchange differences. EBITDA represents net income before interest and swap interest paid, income tax expense, depreciation and amortization. Adjusted EBITDA represents adjusted net income before interest and swap interest paid, income tax expense, depreciation and amortization. Adjusted net income, adjusted EPS, EBITDA and adjusted EBITDA, are not recognized measurements under U.S. GAAP. Our calculation of adjusted net income, adjusted EPS, EBITDA and adjusted EBITDA, 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.

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

Third Quarter Ended
September 30,
Nine Months Ended
September 30,
2012 2013 2012 2013
Net Income - Adjusted Net Income
Net income 6,633,988 4,146,514 21,199,409 15,685,097
Loss/(gain) on derivatives 389,859 153,989 1,153,309 (64,611)
Less swap interest paid (1,229,354) (655,066) (3,603,540) (2,366,466)
Gain on sale of vessels, net -- -- (1,372,409) --
Unrealized exchange (gain)/loss (1,712) (18,722) 92,138 (10,694)
Share based compensation -- 73,758 -- 218,870
Adjusted Net Income 5,792,781 3,700,473 17,468,907 13,462,196
Net income - EBITDA
Net income 6,633,988 4,146,514 21,199,409 15,685,097
Plus interest and finance costs incl. Swap interest paid 3,689,284 2,534,304 10,853,936 8,299,090
Less interest income (63,603) (83,059) (169,844) (203,666)
Plus depreciation 7,334,240 7,848,186 21,442,465 22,671,019
EBITDA 17,593,909 14,445,945 53,325,966 46,451,540
Adjusted Net income - Adjusted EBITDA
Adjusted Net Income 5,792,781 3,700,473 17,468,907 13,462,196
Plus interest and finance costs incl. Swap interest paid 3,689,284 2,534,304 10,853,936 8,299,090
Less interest income (63,603) (83,059) (169,844) (203,666)
Plus depreciation 7,334,240 7,848,186 21,442,465 22,671,019
Adjusted EBITDA 16,752,702 13,999,904 49,595,464 44,228,639
EPS - Adjusted EPS
Net income 6,633,988 4,146,514 21,199,409 15,685,097
Adjusted net income 5,792,781 3,700,473 17,468,907 13,462,196
Weighted average number of shares 20,552,568 32,052,568 20,552,568 26,997,623
EPS - Basic and Diluted 0.32 0.13 1.03 0.58
Adjusted EPS 0.28 0.12 0.85 0.50
StealthGas Inc.
Unaudited Consolidated Statements of Income
(Expressed in United States Dollars, except number of shares)
Quarters Ended
September 30,
Nine Months Ended
September 30,
2012 2013 2012 2013
Revenues
Voyage revenues 28,561,538 27,272,345 86,735,515 82,108,144
Voyage revenues - related party 1,795,167 2,465,350 1,891,884 7,340,891
Total revenues 30,356,705 29,737,695 88,627,399 89,449,035
Expenses
Voyage expenses 3,170,914 2,544,920 7,753,002 9,894,145
Voyage expenses - related party 376,435 350,564 1,094,730 1,089,651
Vessels' operating expenses 7,083,383 8,826,188 21,972,357 23,447,417
Vessels' operating expenses - related party 615,677 1,025,556 885,261 3,066,316
Dry-docking costs 262,752 1,086,398 2,045,656 2,456,614
Management fees - related party 1,079,182 1,272,055 3,207,885 3,502,450
General and administrative expenses 986,483 651,346 2,151,866 1,892,747
Depreciation 7,334,240 7,848,186 21,442,465 22,671,019
Net gain on sale of vessels -- -- (1,372,409) --
Total expenses 20,909,066 23,605,213 59,180,813 68,020,359
Income from operations 9,447,639 6,132,482 29,446,586 21,428,676
Other (expenses)/income
Interest and finance costs (2,459,930) (1,879,238) (7,250,396) (5,932,624)
Gain/(Loss) on derivatives (389,859) (153,989) (1,153,309) 64,611
Interest income 63,603 83,059 169,844 203,666
Foreign exchange loss (27,465) (35,800) (13,316) (79,232)
Other expenses, net (2,813,651) (1,985,968) (8,247,177) (5,743,579)
Net income 6,633,988 4,146,514 21,199,409 15,685,097
Earnings per share
- Basic 0.32 0.13 1.03 0.58
- Diluted 0.32 0.13 1.03 0.58
Weighted average number of shares
-Basic 20,552,568 32,052,568 20,552,568 26,997,623
-Diluted 20,552,568 32,052,568 20,552,568 26,997,623
StealthGas Inc.
Unaudited Consolidated Balance Sheets
(Expressed in United States Dollars)
December 31,
2012
September 30,
2013
Assets
Current assets
Cash and cash equivalents 42,273,000 95,856,697
Receivable from related party -- 96,717
Trade and other receivables 3,029,284 3,391,637
Claims receivable 32,835 1,748,496
Inventories 3,152,407 3,341,831
Advances and prepayments 435,226 702,705
Restricted cash 7,340,655 6,865,568
Total current assets 56,263,407 112,003,651
Non current assets
Advances for vessels under construction 19,321,045 46,283,936
Vessels, net 634,634,671 685,112,848
Other receivables 224,422 578,173
Restricted cash 1,300,000 2,100,000
Deferred finance charges, net of accumulated amortization of $1,786,158 and $2,107,682 1,295,486 1,415,992
Total non current assets 656,775,624 735,490,949
Total assets 713,039,031 847,494,600
Liabilities and Stockholders' Equity
Current liabilities
Payable to related party 7,288,899 7,944,631
Trade accounts payable 5,927,526 7,293,704
Accrued liabilities 2,855,170 3,459,375
Customer deposits 280,000 --
Deferred income 3,129,671 3,058,374
Fair value of derivatives 539,904 370,702
Current portion of long-term debt 35,787,544 72,873,605
Total current liabilities 55,808,714 95,000,391
Non current liabilities
Fair value of derivatives 5,409,337 3,240,319
Other non current liabilities 222,770 552,131
Long-term debt 309,564,768 281,673,584
Total non current liabilities 315,196,875 285,466,034
Total liabilities 371,005,589 380,466,425
Commitments and contingencies -- --
Stockholders' equity
Capital stock 206,273 321,273
Additional paid-in capital 275,792,164 385,079,657
Retained earnings 66,016,627 81,701,724
Accumulated other comprehensive income/(loss) 18,378 (74,479)
Total stockholders' equity 342,033,442 467,028,175
Total liabilities and stockholders' equity 713,039,031 847,494,600
StealthGas Inc.
Unaudited Consolidated Statements of Cash Flows
(Expressed in United States Dollars)
Nine Months Ended
September 30,
2012 2013
Cash flows from operating activities
Net income for the period 21,199,409 15,685,097
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 21,442,465 22,671,019
Amortization of deferred finance charges 325,577 321,524
Unrealized exchange loss/(gain) 92,138 (10,694)
Share based compensation -- 218,870
Change in fair value of derivatives (2,450,232) (2,431,077)
Net gain on sale of vessels (1,372,409) --
Changes in operating assets and liabilities:
(Increase)/decrease in
Trade and other receivables (1,038,642) (716,104)
Claims receivable (275,734) (1,922,975)
Inventories (198,666) (189,424)
Advances and prepayments 119,337 (267,479)
Increase/(decrease) in
Balances with related parties 107,632 559,015
Trade accounts payable 464,668 1,366,178
Accrued liabilities (1,128,920) 604,205
Other non current liabilities -- 329,361
Deferred income (257,320) (71,297)
Net cash provided by operating activities 37,029,303 36,146,219
Cash flows from investing activities
Insurance proceeds 792,137 207,314
Acquisitions and advances for vessels under construction (62,513,765) (100,112,087)
Proceeds from sale of vessels, net 18,136,907 --
Decrease/(Increase) in restricted cash account 2,141,047 (324,913)
Net cash used in investing activities (41,443,674) (100,229,686)
Cash flows from financing activities
Net proceeds from common stock issuance -- 109,183,623
Deferred finance charges -- (442,030)
Customer deposits paid -- (280,000)
Loan repayment (41,048,198) (27,567,623)
Proceeds from long-term debt 43,250,000 36,762,500
Net cash provided by financing activities 2,201,802 117,656,470
Effect of exchange rate changes on cash (92,138) 10,694
Net (decrease)/increase in cash and cash equivalents (2,304,707) 53,583,697
Cash and cash equivalents at beginning of year 43,539,303 42,273,000
Cash and cash equivalents at end of period 41,234,596 95,856,697

CONTACT: Harry Charogiannis Chief Financial Officer STEALTHGAS INC. 011-30-210-6250-001 E-mail: info@stealthgas.comSource:StealthGas Inc.