STEALTHGAS announced its unaudited financial and operating results for the first quarter ended March 31, 2023.
OPERATIONAL AND FINANCIAL HIGHLIGHTS1
- Entered into a number of medium to long term charters increasing forward coverage. About 80% of fleet days are secured on period charters for the remainder of 2023, with total fleet employment days for all subsequent periods generating approximately $115 million (excl. JV vessels) in contracted revenues.
- During Q1 23’, two of the three vessels previously announced as being sold were delivered to their buyers, and the third one was delivered in April 2023. In addition, one medium gas carrier, the Eco Evoluzione, was sold at a profit of $13.9 million by one of the joint ventures to a third party and delivered to the buyers in March 2023.
- Recently entered into sale agreements for four vessels in the fleet, the Eco Czar, the Eco Nemesis, the Eco Texiana and the Eco Enigma. All vessels were sold at a profit and the sale will be reflected in the second and third quarter results depending on the timing of the delivery of the vessels.
- Reduced debt by $31.7 million from $277.1 million as of December 31, 2022, net of deferred finance charges, to $245.4 million as of March 31, 2023.
- Revenues at $38.1 million for Q1 23’ despite having reduced the number of vessels in the fleet from 35 vessels at the end of Q1 22’ to 32 vessels at the end of Q1 23’.
- Modest increase of $0.6 million (or 2.2%) in total expenses from Q1 22’ to Q1 23’ resulting in improved income from operations of $9.7 million for Q1 23’, an increase of $1.5 million (or 18.3%) compared $8.2 million for Q1 22’.
- Net Income of $16.8 million for Q1 23’ corresponding to an EPS of $0.44, the highest quarterly profits of the last decade, and an increase of 121% compared to Q1 22’.
1 EBITDA, Adjusted EBITDA, Adjusted Net Income and Adjusted EPS are non-GAAP measures. Refer to the reconciliation of these measures to the most directly comparable financial measure in accordance with GAAP set forth later in this release.
First Quarter 2023 Results:
- Revenues for the three months ended March 31, 2023 amounted to $38.1 million compared to revenues of $35.9 million for the three months ended March 31, 2022 while the fleet over the corresponding periods was reduced from 35 vessels at the end of Q1 22’ to 32 vessels at the end of Q1 23’. The vessels remaining in the fleet earned higher revenues compared to the same period in the prior year due to improved market conditions.
- Voyage expenses and vessels’ operating expenses for the three months ended March 31, 2023 were $4.0 million and $14.5 million, respectively, compared to $4.2 million and $12.9 million, respectively, for the three months ended March 31, 2022. While voyage expenses were relatively stable despite a decrease in spot market days, there was a $1.6 million increase in vessels’ operating expenses compared to the same period of 2022 mainly due to an increase in crew expenses.
- Drydocking costs for the three months ended March 31, 2023 and 2022 were $1.1 million and $0.4 million, respectively. Drydocking expenses during the first quarter of 2023 mainly relate to the drydocking of one vessel and preparation of others.
- Depreciation for the three months ended March 31, 2023 and 2022 was $6.6 million and $7.0 million, respectively, due to the lower average number of vessels owned in 2023.
- Impairment loss for the three months ended March 31, 2023 was $0.1 million, while the impairment loss for the same period of last year of $0.5 million was related to the sale of one LPG carrier.
- Interest and finance costs for the three months ended March 31, 2023 and 2022 were $2.6 million and $2.4 million, respectively. The $0.2 million increase from the same period of last year is very modest when considering the interest rate rises over the period because included in the $2.5 million were profits from the unwinding of two interest rate swaps that were terminated before their maturity when the corresponding loan was repaid.
- Interest income for the three months ended March 31, 2023 and 2022 was $1.0 million and $0.01 million, respectively. The increase is attributed to increases in interest rates over the corresponding period.
- Equity earnings in joint ventures for the three months ended March 31, 2023 and 2022, was a gain of $8.8 million and $1.7 million, respectively. The $7.1 million increase from the same period of last year is mainly due to the profitable sale of a vessel during the first quarter of 2023 by one of the joint ventures.
- As a result of the above, for the three months ended March 31, 2023, the Company reported net income of $16.8 million, compared to a net income of $7.6 million for the three months ended March 31, 2022, an increase of 121%. The weighted average number of shares outstanding for the three months ended March 31, 2023 and 2022 was 38.0 million and 37.9 million, respectively.
- Earnings per share, basic and diluted, for the three months ended March 31, 2023 amounted to $0.44 compared to earnings per share of $0.20 for the same period of last year and increase of 120%.
- Adjusted net income was $17.3 million corresponding to an Adjusted EPS of $0.45 for the three months ended March 31, 2023 compared to Adjusted net income of $8.8 million corresponding to an Adjusted EPS of $0.23 for the same period of last year, an increase of 97%.
- EBITDA for the three months ended March 31, 2023 amounted to $25.0 million. An average of 32.3 vessels were owned by the Company during the three months ended March 31, 2023 compared to 36.5 vessels for the same period of 2022.
- As of March 31, 2023, cash and cash equivalents and short term investments amounted to $92.6 million and total debt amounted to $245.4 million.
Fleet Update Since Previous Announcement
The Company announced the conclusion of the following chartering arrangements (of three or more months duration):
- A three years time charter for its 2009 built LPG carrier Gas Exelero, until Apr 2026.
- A fourteen months time charter for its 2014 built LPG carrier Eco Stream, until Jun 2024.
- A twelve months time charter for its 2006 built LPG carrier Eco Royalty, until Feb 2024.
- A twelve months time charter extension for its 2006 built LPG carrier Gas Alice, until Jul 2024.
- A twelve months time charter extension for its 2018 built LPG carrier Eco Ice, until Oct 2024.
- A six months time charter extension for its 2015 built LPG carrier Eco Alice, until Sep 2023.
- A six months time charter extension for its 2009 built LPG carrier Gas Astrid, until Sep 2023.
- A six months time charter for its 2016 built LPG carrier Eco Nical, until Oct 2023.
- A five months time charter for its 2011 built LPG carrier Gas Elixir, until Aug 2023.
As of May 2023, the Company has total contracted revenues of approximately $115 million.
For the remainder of the year 2023, the Company has about 80% of fleet days secured under period contracts, with contracted revenues of approximately $70 million.
In addition, the following chartering arrangements were concluded for the joint venture vessels:
- A twelve months time charter for the 2008 built LPG carrier the Eco Ethereal, until Apr 2024 with an option for the charterer to extend for an additional twelve months and a purchase option which if not exercised the joint venture has a sell option.
During March 2023, the joint-venture sold and delivered the 2010 built Eco Evoluzione to a third party. For Q1 23’ the joint venture recognized a gain of $13.9 million from the sale, with the Company’s share, amounting to $7.1 million, being included in the equity earnings in joint ventures. The proceeds from the sale, together with retained earnings were distributed to the joint venture partners in April 2023. The Company received $19.2 million in this distribution which will be reflected in its Q2 23’ cashflow results.
The Company also announced the sale of four vessels, the 2015 built Eco Czar, Eco Nemesis, and Eco Enigma and the 2020 built Eco Texiana to third parties. The deliveries of the vessels are expected to be concluded between May and July. All vessels were sold at a profit that the Company will recognize, as well as the sale proceeds to be reflected in the cashflow results, during the respective quarter of each vessel’s delivery.
CEO Harry Vafias Commented
We are reaping the fruits of the favourable market conditions and our sound business strategy and execution. After having reported in the previous quarter record annual profits, it is with great pleasure that we announce this time the highest quarterly profit in at least the last decade. The laudable bottom line results were driven by two factors, the strong performance and revenue generation from our existing fleet and the returns we realised from the investments in our joint ventures following the sale of one vessel. The profitable sale of four vessels that we announced today will further boost our future results. We are taking the opportunity to divest assets in a rising market and will continue to diversify the fleet with the timely addition of bigger sized vessels. At the same time we are renewing our efforts to contain our cost base and will make use of our liquidity to deleverage in a rising interest rate environment and return value back to our shareholders via a $15 million share buyback. We expect these steps will solidify the company’s future, while at the same time we remain positive for the medium term outlook of the LPG shipping market.