StealthGas (GASS) 1 Mar 212020 Q4 Earnings call transcript

Good morning, everybody, and welcome to our fourth quarter and 12 months 2020 earnings conference call and webcast. I’m Michael Jolliffe, the Chairman of the Board of StealthGas. And with me on our call today is Harry Vafias, the Chief Executive Officer of StealthGas, along with our Finance Officer, Fenia Sakellaris.

Before we commence our presentation, I would like to remind you that we will be discussing forward-looking statements, which reflect current views with respect to future events and financial performance. At this stage, if you could all take a moment to read our disclaimer on Slide 2 of this presentation. in with disclosed Exchange Securities further Commission. are StealthGas the filing and Risks like that States point unless would to I also out are stated otherwise implicitly all in United dollars. clarified, quoted, amounts key highlights released we Slide X summarizes of fourth results today. quarter our that XXXX the

lockdowns, market recurring recovery, in along where quarter in pandemic, than of the is, delays, market demand. freight was to any prevented ongoing remained COVID-XX particularly better compared greatly of faced course, fairly Asia, at affects Vaccine market spot, environment rates. the Our three this meaningful we XXXX. flat Admittedly, XXXX unchanged which LPG quarter with Main indeed a this European last and more trade, in in region. although primarily reason for far stable tougher the Europe

the XX Given spot high the this in quarter with quarter performance thus presence activity environment difficult with market, than strong charter most risks the in managed and of improve market soft in stronger voyage than upon quarter. undermining time operating where region. negligible, XXXX, expertise, Hence, third were off the Even was to our leveraging quite were our Asian trading and from spot and market new vessels profit. market a of predominantly throughout even spot this even managed to costs adapting on our end quite demonstrated was the hires, to these more We StealthGas earnings earnings the resourceful with in potential. versatile conditions stemming and

carrier X scheduled thus gas within aggregate expected quarter, this out carriers underwent operating of to X, from our We we medium-sized mention that X also our quarter an gas medium as an loss. and operations producing dockings their took need

for small off drydocking of of utilization result four Focusing was as about with days hires LPGs. fleet the of quarter XXXX X technical XX XX.X% operations, a our on our of

at of to XX.X%, than mainly ships this in equivalent came days. of of voyage our predominantly operational our in operating XX% XX more our due market, terms In utilization, to spot the

we remainder generating forward, agreements total revenues. of million. fleet our structures, million of for periods time Including total to subsequent in secured revenues venture increased for with the charters the $XX fleet contracted with our Going XX% on employment all have $XX period close to base about XXXX, days joint secured charter

During sold we class which the meter cubic the pressurized for we Pasha, trading our XX,XXX Eco LPG, of LPG capital an fourth thus XXXX, Moreover, this phase. oldest took built. newbuilding vessel, ice the XXXX our Blizzard, further of small earlier month, Gas quarter is delivery expansion completing

Looking at our performance highlights. financial

from costs incurred, charter about exposure a an $X.X $X.XX. EBITDA, voyage EPS an daily adjusted net of corresponding earnings. million, With suppressing charges, so by thus came as day our $XX $XXX equivalent income in our our daily of marking did is, equivalent the adjusted and stemming spot time to XXXX revenues X of of ships increase redelivered came larger bankruptcy in revenues million same to to million, charterer. compared of the Compared last off due to including X at increase due of to our voyage of year. Our coming vessels This an the primarily quarter was the $XX.X $X.X LPGs third bareboat, period at impairment our increased, charter that decreased our the time the excluding about adjusted million,

had StealthGas net performance. our generated given items, and million, non-cash low unpredictable a in remains to quite $XX excluding provides cash we results is gearing, #X an ended with earnings capital good income and are fleet $X.XX. still, year a of the In tough of base analysis It during that this the this XXXX, X it quarters on employment. almost corresponding spite that to should year near a the of share strong in faced. all annual noted structure interesting, our Indeed, be capital our of comment a market, we attributed quarter that Slide per our an second profit an spite performance with solid of was strong Our mostly however, commitments of we but difficulties to future. the for

spot In were on terms joint of picked intervention up. we bareboat, period market. vessels, to charters out of our difficult time concluded economic environment charters the of in of our be XX our since types, the This charters on last of gradual X announcement, operating from first the that charter of that recovery. and of majority sign charter X these it new concluded onwards could XX including have vessels, fleet of XX seasonal the beginning venture the we XX either or possibly can factors extensions. the these February when be and Since visibly market’s activity Regardless attributed

XX%, of coming coverage our of of year the period period in of Our quarter is first the while in is the XXXX order for through XX%. the this currently order remainder

deals, increased $XX With million. Including order about in joint joint revenues to these million. we our contracted $XX as to our ventures, two Slide ventures’ X, a performance. In to update to our would the total of like summary I preserve managed provide secured revenues

charter under majority X total The vessels comprises small Our out in region. All Eco marked throughout vessels, the XXXX contracts. carrier, the for operating the X traded recently first medium quarter of has LPG as charter which months. of vessels last time joint for another spot time all Nebula, of the gas of contract in the these improved the market performance an venture, was X vessels extended currently Asian in its

costs are off-hire and combined Gaschem drydocking thus of steady venture, time a gas underwent million. all our comprising under Stade, the the thus contracts, $X X vessels, producing Focusing second carrier quarter X were charter joint flow. of affecting our Bremen profitability quarter vessels, as Gaschem medium Two their the within on cash to scheduled close XXXX, and for these the drydocking

vessels on excluding our XX, Slide focuses America. the in joint and Currently, we distribution company geography of In a the gas. trading have Far and and local venture of in for vessels, Africa our I LPG and in Fenia East, vessels, snapshot positioning X, our X regional graph the our of our LPG will now presented XXXX. as Middle East February Europe, of over trading of our in vessels This the Sakellaris financial XX trade XX performance. X to vessels is in terms of turn fleet call

Jolliffe Mr. you, everyone. to and morning Thank good

We performance for on financial the XXXX. quarter presentation will continue focusing of the our fourth

profitability our our during activity As spot call, last XXXX revenue quarter potential. mentioned and in the of increased suppressed earlier both

in where at move X, income statement increase Voyage to $XX the on ‘XX, bareboat for million same mostly million, million, XX%. on to fewer of to bareboat a XX%. $XX.X increase base period we marked of $X.X X stemming ‘XX crew see about market. XX% a the the the of revenues and LPG time to last period to came to our vessels activity either the increase above, marking our cost came about Slide to million in a $X.X corresponding ‘XX the our charter spot Based operating charter all of net costs rise attributed a on COVID-XX time attributed X of the fourth Running by from of compared the XX% year. of This QX mostly were increased to now revenues compared marking $XX.X margin drydocking net spot year. us larger Increased at corresponding cost to million, QX XX% period revenue the medical our of small increase Drydocking previous million, well. due to quarter and pandemic Let as on against reduction $X to of is revenue a or costs for change vessels. compared add Voyage cost amounted exposure operating as vessels. LPG same in

XXXX. for drydocking scheduled X have We

$X.X of small $X.X this EBITDA are of for drydocking $XX.X evenly Based and apportioned debt. budget quarter. with the All marked our our in on million. these, decrease, almost of million are is order to adjusted currently the attributed and finance decrease of throughout to of and a costs all mainly Interest close the lowering LIBOR LPGs million

not this low levels order which LIBOR have finance had costs it swap $XXX,XXX. Our for would the of decreased due very interest, to been in was quarter further even

are and $X.XX. We $X.X currently of will With continue gas carriers LIBOR year’s at above, of net cost, so income remains on earlier all to on above our remain profitability. in to quarter incurred cost, as of two an added of attributed ended long swap the as hedged, million, interest drydocking from XX% million. to low. fourth the $X to Based level We of the adjusted XXXX our of including of our an losses medium to this analyzed income EPS off-hire corresponding as at are adjusted regards mentioned this quarter points with call, and we this about further the JVs

the XXXX, adjusted examined. for condition. market the months $XX X whole a our to net of So income performance indicator XX an is the EPS difficult adjusted corresponding performance our for good Slide million, given of $X.XX, demonstrates period

XXXX. XX.X% on, our the mentioned of was ‘XX whole in the As of XX.X% order earlier utilization for and operational for QX

terms LPGs, mainly from at our charter XXX an about on charter due rise came and improved of basis noticed now to small a prevailed In annual time it adjusted of we rates daily equivalent, is rates time for the revenue. tanker the COVID-XX XX,XXX producing that the beginning prior strong a contract charter our XXXX currently CBM semi-refrigerated a of charter and time pandemic. for Improved single Aframax vessels, to which

Slide have means no the the commitments cash at date, balance to in Looking $XX in of sheet in near expenditure, is X, while, further million free we no our cash capital our future. order which

our now $XX we is year. leverage around our XX.X%. order gearing will reduce on scheduled principal in Our Based repayments, per by of million the

no majority I who outlook. now refinancing CEO, well. hand already as our refinancing XXXX Mr. Vafias, for over Harry will completed discuss balloon market have company obligations for and the and of to will have XXXX you We balloon

with proceed XX. We Slide

amounted As We loadings the to in global X.X%, XXX.X difficult trade EU market tonnes, of can, LPG marking scenarios however, going provide to trade assess X.X%. contraction uncertainty million possible upon was LPG a COVID-XX as imports to the decline annual LPG summary, brought future. firmly still market’s pandemic In it’s very fell as and LPG while prevails, imports marked our commentary XXXX, forward. X%. a to sharper decline by about moderate an by of China

EU, the and of LPG for trade of this, industrial scaled lower significant on demand. Autogas Petchem refineries XXXX the took during a combination on down in small to XXXX. lockdown scaled back Added combined second quarter from also demand weaker out trade the with ships. Focusing LPG

Slide On are during shipbroker COVID-XX recovering the trades we well However, that both analysis, per QX U.S. a can as by ships backed XXXX, ethylene if XXXX, export increase expected a to due rates Grieg or first volumes. as from sign in deemed too of petchem seasonal for rates volumes is gradual It’s, fairly as to X% XX, to remained as the however, stable. of by gas early lockdowns it assess see new small stabilization recovery. market factors be

a and have trade spot throughout up of as for was picked petchems period with small significant seen cubic Europe. challenging in activity West East was been for a better intensifies, Since time. continue second process Suez, have XXXX. to has fixtures low likely continued than likely the reasonably market some meter have activity X,XXX Looking substantial renewals a old The LPG and COVID-XX the the positive avoid future markets’ of vessels. might LPG market once the will rate of few small remained better particularly Both tonnage. Since that pressurized charter relatively announcement, XX% The driven Period deciding of Suez low of in increased we idle segment of you the beginning to demolition short-term the which active, few LPG will have current all the economic charter highly half time fleet lead and be charters. of managed in our February, environment order quarter, years and to market any tonnage. age. see well fourth spot our within of is witness of things to to we segments, owners as has the fundamentals, more levels economic is XXXX. small take ships. demolition situation, above specific XX X at improve, the as vaccination the the increased should owners. An an accelerate book probably we by might broader global permits. activity time and increase last charterers recovery It’s that near our conditions, fleet, Regardless aging recorded

about On share that’s our the the the until As year, price to most follow mentioning, segments, the shipping fairly discussed to published market struggled should hence, good are carriers XX correlation negative stocks of including of per market our the better. XXXX and reality, stocks of that XXXX. of majority XXXX, have the COVID-XX broad beginning the vessels company’s shipping year, with however, In broad price performance no mainly last presented that with delivered oil surrounding a performance there during been on impact of orders Since worth of circumstances far with It’s for shipping shipping Slide XX, due industry. along X% given orders, be LPG, a the registered The the selected gas volatility. to generalization oil. recent company commencing had is, most stock our valuations most we of total fleet, outlook since XXXX. of beginning group of is the end peer

our that performance given Focusing our at our profitability outlining XX% about NAV be we the to Slide that with XX, key sheet. the in we ahead. will currently affect of quarters we along robust stated to are company, balance On both variables very deem trade XX% on low our

to the firm Given predictions. make quite it’s turmoil, difficult market

our have key financial quarters. related as points in upcoming assist the a We few may that performance

precontracted total million that is coverage about in point have revenues. period $XX First a we of

market In spot but up leverage further. the addition, several which at significant firm period gives same should we the time vessels us operate poses market, risk activity and operating pick a rates in

on but LIBOR EBITDA at flow. environment. the have give and in improved should importantly bring numerical remission, to our fast Fourth rates in calculated we under our solid to predictions, Moreover, quite we our on about is $XXX spot Hence, into reluctant pandemic market also have charters, our rate cost at even MGC that fundamentals its even small Last strong producing most we semi-refs cash low XXK rates a we will any is vessels increase increase the are while $X that time decrease that a finance are a tankers daily are pace. of by point we a all very further. million. period will majority our anticipate charters Although and vaccines leverage recover of

an Moreover, However, confident present our cost examined. our concluding on complete a we perform of market given have period thus more we employment Slide strong X difficult points. And our even to until concluding drydockings good to downside, of At performance, XX our with feel our year, the we end have the will up the within our brief Chairman improvement. vessels period summarize Concluding the presentation end glimpses we year, of summary building the XXXX. remarks XX, stage, much should this amidst base. unusually begin will our show that particularly better we market for company’s

we very the with bankruptcy an shipping earnings On million, earlier with XXXX. redeliver charterers, almost our we to generated one ships at of the With the COVID-XX in, per were of adjusted was segment operate particularly The currently, a for Nevertheless, X net marked were $XX year we not XXXX XXXX, second majority during for well to agreed. to tanker than $X.XX reasons in globally market was the low top shipping as that, feel world the had will spared. associated always XXXX. we in an with corresponding demand The for pandemic, positive subsegments adjusted had levels in operate of regard previously be of which half remembered the and as cycle. of soft, of of income of hit rates decline our are we rates the the share and affected LPG

Looking COVID-XX throughout that ahead, to market even pandemic possibly due we might the the whole last of turbulence XXXX. recognize

operate leverage of can balance our the we our we vessel However, leverage strengths, upon we cash have operating solid and our base a and – as vessels, gearing sheet, venture fleet our – including ships. including significant our joint XX joint low

with shares long-standing steady an this as leverage trade a low and potential that we a position operate. we at is record a believe prudent we opportunity for investors in company segment a As levels, in of which the and strongly our have strong low

the our now like questions. of the to have reached your presentation, open We end floor would we for and

you. So Thank floor. operator, open please the

of from Instructions] comes a Thank question, have Giveans [Operator and you, Jefferies. sir. Please We from it ahead question Randy with you the line go sir.

Thanks, it operator. going? Howdy, how is gentlemen,

Hi, Randy, well. hope you are

Yes, here freeze. yes, good Houston post Good. yes. All is in

charters? charters you then are of some on the Now expiring soon contracts? your for at they for durations you looking numerous Were XX rates higher, coming you want spot about the some lower, comment on to exposure? or do spot, keep And can vessels new the as on also, same and those the

Yes. Thank you, Randy.

because charters in levels. soft obviously, still want cycle, ships we low As are COVID to don’t at fix part you we of too the around, with understand, many being especially the longer very on

in idea – fix the X or to X rates. at more to we charters charters. just market, fix and higher let’s rest lock months, a for the next So if to hopefully, and protect the breakeven in is for try us, say, don’t and into ourselves ships better We try shorter ships loss-making to want then see

charters? Okay. And then on the details current

those, give previously as they at announced. same I tell about the don’t but levels you are can We

utilization sense. and the at first then it. day That X of performed first in how the And makes quarter? Got of Alright. rates looking quarter has months the here kind

yet. know, beginning to why than say a are don’t better we in that I want But call early it That’s you champagne to QX. the of bit the to start slightly we bit have as a bottles it’s optimistic. that Listen, say. popping looks But said we

are bit we early. a think I

content coming is and is now soon? or any tenders should additional price on looking on also fleet, Okay. or buybacks to NAV? guess lastly, that, at And massive more we And vessel are just with obviously then your a purchases share it then expect sales you your where at thoughts discount as I

we second starting which our the Obviously, know, your at COVID risky, shareholders. the to a It the wave, from this question, if us be COVID woods. we that the don’t of out is the definitely do these good are thing we’re was the know of front because Board beginning then first tender levels, yet COVID you the a because going and stock today, shorter, it’s to of But something problem in you But As was buyback, I beginning nightmare. still the Board. the did a we put something will of share at bit not timing-wise, gets discussing with think us. for was

We buybacks and tender a look have we good. and that have lot see done solid sheet a when of balance offers share we things

As I early. said, I are think slightly we

We something with as Now sold still to have buy older yes, wobbly. don’t selling things might ships units with scrapping. ship appetite bit very on really, them old our plans but is very, ship, our maybe buyers will being and for Pasha, which a of take so with older have further right now. priority for and not ship, for now read, look younger again, we ships there that shows replacing strategy, you we the trading, XXXX Gas them really the But it’s old not some at, maybe big any

for so much. Got me. it. that’s Alright. Well, Thanks it

Thank you, Randy.

[Operator no Instructions] to question point. appear We this at have

back you. So the I hand to conference

with to joining having you very trust at QX for you and XXXX We Thank our today our May. again thank next your look at and forward us for much. like in call conference us you interest in all for We’d call our to results our company.