StealthGas (GASS) 21 Nov 222022 Q3 Earnings call transcript

Good day, and thank you for standing by. Welcome to the StealthGas Third Quarter 2022 Results Conference Call. At this time all participants’ are in listen-only mode. After the speakers’ presentation there will be the question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. to Jolliffe. conference like speaker to now Michael today would hand over the our I ahead. go Please

aspects. Good discuss morning, webcast. and discuss welcome Directors. is XXXX Sistovaris, Jolliffe, everyone, Harry and Konstantinos of company And earnings the nine quarter Chairman Relations Chief our Investor conference outlook months joining and Vafias, me and call call Board our markets and the This financial on Michael to is to of our today third to Executive,

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

another a needs company in was for of world. quarter. we play by billion me wood charcoal an the In pure based as saying decarbonizing LPG the energy believe X which of intensive important for role other report world, to can happy a quarter fuel to and carbon third mark. than as still have also XXXX, read future you for start these we LPG fossil kerosene, fuels this population quarter yet are month, their billion let Now this are earnings third profitable released needs. We people there surpassed people may trading using the Today, X.X world's that the our results their meet and has less

these general. and proceed what market let's discuss to in see the So we results in

some highlights. we three, Turning to slide summarize

our to be less the so we As months, we there remains previous probably typically summer opportunity that of year. call, pushed vessels. perform vessel drydocking this This drydocked beginning of figures. in be to in the back the four the of is One activity, our our utilization course, mentioned next will to year scheduled took in reduced,

increased, months, This by the actually during our was lock vessels spot as a of During XXX-days XX%. in market considered our exposure charters. their coming we period was we have the and to we temporary result had year-on-year, Overall, spot summer prefer quarter. a softer exposure in period is charters decreased off

firming, entered last XX-period During duration the is we as than which of into are charters, market the more majority or couple the of year of months, more. one

have year. Now period fleet our on next days for we charters secured XX% of

vessels revenues contracted JV almost Our $XXX of million joint our excluding and are $XX million, as November venture vessels. including

building new is news million the purchase XXXX. In venture the committed we equity what the during $XX two that can other discussed Thus, call. any don't our sale and we receipt handle remaining for tune million. new What of That these sale our we though million for have new last that $XX.X we terms reinvestments in sale finance distributions one to the comfortably from is will vessels joint vessels vessel, the have carrier in that of is the for building existing $XX about vessels activity, medium the cash. with be gas of commitment and than of

we we In responsible better for softer higher rise in had the oil comparative last the third costs, need the fleet, to for our quarter fuel spot four line to depreciation, came our from quarters, OpEx increase smaller to smaller our the exposure last mind recent were saw the prices. highlights, also in at Overall, million with the you were $X.X in included quarter market in that at are as results. trend million spinoff the profits due million, it from a tankers boosted we was was in year of keep year's for the last of spot financial market, combination in was as to paying $XX.X net rising in as in we due In investments fleet. as and was the revenues $XX.X Voyage our last voyage a than vessels , December well know. though, was of bunker that and profit but due year's. costs, costs substantial the compared Looking JVs. result to part and decreases briefly that Overall the our

through For the so quarter reported managing for increase a brings months. for that $X.XX month EPS We we This of period, profits to remain and our million, is our XXX% in nine the liquidity nine prudently and year-on-year. cash the steadfast our was $X.XX $XX.X total Mainly and the $XX.X we during generated our joint also the to of completed of from end internally million we the distributions -- of first the million, refinancing six compared vessels ventures. $XX.X flow refinancing cash the last completed our sales, year. quarter, at

be maintaining ratio of debt to low capitalized well XX%. continue a We

into market. good concluded move in to longer update charter extensions or we more Since XX interest similar for improved new were concluded announcement, from our on charterers fleet for These previous us sign of heading a the we as slide saw in Let employment winter, four at charters recently periods always as our November. levels. successfully and locking

of days. vessels to remainder but of our four we for in increased market, charters, just the the the For with spot new have XXXX have coverage fleet we XXXX, XX% forward

We million five, to year. In going secured forward going joint next ventures. our update JV announcement. did the $XX since revenues two of of Including have not -- conclude forward, are any to new revenues vessels, We provide on for $XX are $XXX to our like last close the I secured million. close would an which closer charters million to slide

of was completed $XX.X LPG which one received the market. we small comprises venture, the joint The in Nebula vessels, operating million the in vessel first venture. joint Eco has and distributions from Our sale spot

more gas venture joint construction. second of Our under one comprises two plus carriers, medium

intend to As we together own fund JV in has this any be for discussed, The did sufficient previously with cash finance acquisition arranged. equity. our with proceeds hand this earmarked not to

plus the market for has significantly larger vessels the recently. side, the risen On

In XX really since venture This of terms our November the of call. our our split the of and our snapshot fleet to XX Europe, of turn Suez, Sistovaris the geography XX, quarter particularly the East, and of for regional presented previous west six, trading is more in The call in focuses in the XXXX. Middle as the last slide Konstantinos between you. on our gas. The company a Thank in excluding financial in changed of trading has now I we not our is performance. Far positioning Currently, Asia. distribution vessels vessels joint vessels fleet fleet vessels trade U.S. and and have of one distribution than our Caribbean one three trailing in over will and vessels local Europe graph and Africa.

Michael, the quarter you, I months good third will of for our financial performance discuss Thank everyone. nine XXXX. and and to morning

to due to the quarter at quarters. for revenues as vessels but our $XX.X had months at we were we rising the in fleet quarter previous considerably the see the of $XX.X turn the Net the in the of as period slightly note oil prices, to XX nine nine million the for statement in a we by months, the spot million XX% for number period, expect nine costs XX vessels, to quarter for saw months nine days down year. over same XX% a similar XXXX this income quarters, in in the the and we trend fleet days. the X% following reduction and $XX.X the for to in we the previous more from in We bunker reduced increase total come to went million where seven, months, roughly size. expenses reduction the the third a us came quarter, were what Let million voyage $XX.X and for higher, slide reduction periods against Operating due costs the

is JV decrease another to the as terms rates. in Other Nebula debt similar the bank deposits. do vessels. came $X.X Equity to in our $X.X that We is occur during vessels of more value in Interest quarter, profitably and million rates expensed when million In Depreciation income we the obviously increased the item finance that swaps raising $X for makes expect due months. number continue also despite a period, receive interest mainly as decrease the million to income lower exam, drydocking the on that the to swap rates fair $X.X year's. they year-on-year, we in the amortized structures And saw gains we increase in of million levels. in quarter same costs, stops four interest the we large XXXX. Both share the increased in $X.X the at JV gain profits our million third the these volatility having recorded Eco rate of and the relates of more all a of $XX a XX% nine operate due last the quarter. hold, drydock the in add of and This third during costs for quarter million, structures to month for decrease of and and the quarter increases for nine mainly is interest $X.X some so they quarter. of our the to million as in instead the in in number investees and our a numbers interest sale this period, the this had did Fed until in we valuable, is well

$XX.X the to quarter month six-fold points a of ended of $X.X with for year. result a the period third analyzed all net million last increase, XXXX compared the million of we and above, income As nine

balance at our in sheet number eight. Looking slide

substantial and restricted from cash from constructions. primarily quarter including the in million, saw vessels in operating was are gas sales in vessel which $XX.X million on and The the the liquidity from medium We carrier improved fourth the million, the under $XX.X refinancings quarter the of quarter the the end increase $XX.X secondarily increase liquidity cash XXXX. a Our flow. this at order of of the came advances

million after not of $XXX.X last is to the decreased and reduced, book was investments million, million because of but received $XX.X $XX.X of million outstanding the total in the value million $XXX.X aren't we end debt due vessels $XXX in our Our year. value million, sale The compared $XXX depreciation The was last to distributions, the Eco overall Nebula. at our investments sale net profitable, from of regular two our of to due year, to vessels. the which from JV

debt $X.X forward nine, around our about while briefly and it $XX with ago. to was capital reiterate going expect to per amortization per We close financial will year Concluding debt our structure. be our million slide quarter, quarter profile million a we commentary

As cash us raised part until in underwent million, last refinancing the of our debt fleet. a the mentioned With about margins of project the and February XXXX, amortization. loan up we call, important reduced large more by $XX reduced

balloon refinancing a have no until XXXX first is due. result, we March risk As when our

vessels, the the building up During delivery we financiers two $XX financing new our proceeds not arrangements. letter to closings. expect new with for these third a any did million the financing to and second in sign customary for whereby recently the one of to finance We receive enter quarters, of commitment we of subject did vessels, into existing

this continue below six expect continue leverage Overall, to to agreement with have loan unencumbered keep a We conclude of and the year. before ratio low end XX% we to debt vessels. the we

Fed rate interest the raises by successive rising As our interest the previously showing in has mentioned, into rates started expense.

rates Our during points actually above cost a gone X.X%. XX was the ago, now QX whereas below labor X% below it was and year have average basis

we However, effects we mitigated today. of overall debt, be by as rate will debt XX% the place hedges have these have well interest levels our in for lower put negative as

to now will will market was debt who to at discuss compared For $XXX you a the over CEO, $XXX of the million the Harry Vafias, our end company QX XXXX. year the hand ago, and I outlook. comparison, million,

made Moving that geopolitical some true predictions. provide the to as insight have they current still market uncertainties the future hold and economic in we slide all past XX, the the on despite LPG cast cloud reiterate we'll and overall points the

the of year, LPG this have X.X% expected. U.S. like hand are over increases. from increased So on and countries that freight far increased by according currently the both exporters The was in by line high. countries to East sized into European Banchero other what vessels U.S. and with the data countries LPG Costa sky mile East no on Middle have decreased rates Middle exports ton Norway main global XX% this exports The translating XX%; larger the It's being year. have the coincidence exports

stable the The On We with having its there Chinese feel reduced plus of lockdowns policies the that economic the to on LPG activity. that economy India imports be significant condition. a continues Chinese demand China, China, plant market. revival a we products. and at Chinese to imports X.X capacity problem with of growth a is import XX%. and LPG will this already and hinder for since and plus catalyst any should delays, are receiving the higher slowly PDH eventually grow to with cautiously largest The Europe, role, stream That standard summer resurgence are minus Japan framing optimistic is but X%; of and petrochemical over China overall early projects in that by refer sustainability the why modest is India, chartering for and but some significantly coming after despite COVID Korea have in QX, Europe economic and in year-to-date the XX%; Japan. that still and that end, continue remain have Korea, general restrictive plus its on of did X.X%; are year-to-date, the and amount and demand additions cloud importers exception plus its X% Out

European the for intra-regional one other lately. markets been vessels best is trade of on stated, Now of has as performing world large vessels small previously LPG a LPG side for market and the the our

ample well is did October. the more earth is market, normal to production this from the into We rates the mainly down. in what led However, well not our of weather continue we But seasonal a as On expect during at that market like and of did petrochemical supply the with market factors as summer as is maintenance, demand, to the well see months, U.S. already a coming a end the reduction plant to fundamentals as cold we evolution. we return expect slowing result and in temperatures high tilted LPG day, activity. present the coming commencing XX, slide key is a

QX flat. During were ‘XX, time charter rates

between XX%, the X% there depending location. to basis, be While and on a healthy continues year-over-year growth on and size

a since softened goes quite Asia of the market the in second with it and starting saw few at Looking look the we softened upwards a started market for stable. summer LPG the has petchem PC month relatively until of market ago the that Expectations Suez, spot remained small year. charters for to during more west LPG the winter increased last both half Rates and bit are have activity. for market trade seen usual the demand has we weather upturn good for the to the couple the and balanced expect up for last of fleet relatively months the months in coverage for of the spot next picked spot to amount we saw for market the demand market about last but few it The Suez, increased climb the we cause a and East months. usual West, during and and what remained of This and relatively next the have healthy weeks. delays market small in will requires stable, short-term both but tighten to quite couple seasonal have when months, up summer of is and a similar pace significantly. more a

to expect the year-end. get continue we closer trend to We this as

sitting a idle the current has the regions of year-end. idle loading handysize until in the the candidates spot significant number which only vessels, market, from and a of the no main vessels to market vessels went For available handful

vessels of the through continue many There over our overhang We pressurized expect to an fleet ships older old. the in core fleet fundamentals see look of rates for continues The be small strong to XX-years to winter. promising.

removed subdued activity continues with be also have sooner harder ordering yard risen scrapping and will only CII, strong, only finding jurisdictions. in from for restricted to The scrapped. market see And do it regulations one to and less activity international availability of make XXXX we from Coming LPG so older being to or capitalized vessels later in expect vessel demanding because for the or trades we have partly, trade, vessels trading difficulties and EEXI increasing far partly being prices being in to a lot. because seen newbuilding

per new there published increase call, delivered four of we to see before could and seeing all XX company's not since of vessels believe As scrapping recent of the supplydemand last vessels Again beginning more the delivered a in Slide we that that. on of share orders, to end and the the But ’XX the more vessels of a on vessels our bulk the fleet were that segments. shipping until couple continue improbable, XX be be to performance beyond our risk balance a order. the smallest in we handful estimate are if keep annual year. smallest, ordering sub-X% presents is one since the order

predict the price EPS beginning a has have since the slide stock political would and rising price remain that quite the not future the earnings that see quarters XX% for outlining to that bring in of are market age. in casting unknowns return we lately $X.XX, the year to situation -- our Europe, NAV trades most ahead. quite whether variables stocks, is lower. important the as recession, market economy and In big stocks is What while eventual a activity, on we war stock continue to market the to normal to more performed over months in a the and would low the the in very affect consider be like key ratio. will difficult and that still fleet The followed our nine we is volatile in of vessels. our fundamentals the discount our book price XX, fragile our belief whose repeat StealthGas interest along timing rates and share it making the its Ukraine make at China important is more the a performance all will with especially the attractive same a order these we Our to of cloud economic time, LPG-related other well market At could crude solid to XX-years continued of the oil

the inflationary is may pressures sensitive to cautionary product downside, On increase economic trading our recessions. of that

is focus while we going time Our our fixed entering charters of to like more strong stream our quite did relations. a new a number revenue that forward and at substantial we recently We the pressures. sizable strong have charters, with maintain fleet with point diversified customer to containing cost secure by same

robust upon addition vessels. are of they product as opportunities vessels, of the we're decision vessel be LPG an array diversify that the where asset our move the LPG feel offer structure all with intend recently the so returns. new financial with the larger broader to We same reaffirmed we our the that to within major LPG we will can play industrial at sizes, commitment new comfortable relying players able so payoff a and for for spectrum while our to shares of and service are make were and strategic the customers of buildings, doing fleet our strengthen a sell their just that capital the across We to complete open we time more will pure support company StealthGas space, our we

near this overall see the in which of on third of has are months keep the seasonally year despite hope should the to is the momentum results quarter. we beginning this quarter-on-quarter softer nine to as positive first winter, and traditionally long-term quarter, the fourth market LPG and an expect improvement been very in We The the stronger going. but optimistic

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

from to from Group. take [Operator Instructions] Maxim the the we're our And Now going question. Sullivan line first you. Tate question first of comes Thank

Your line Please is question. your ask open.

day mix the end please? your your acquisitions thank diversify Hello, fleet Harry, your this intent strong you. available Good further at your to of still all. market, to you mentioned in of remarks, are

wait prices at high we but unless Yes, levels. down very and -- prefer we find to newbuilding price secondhand until more so oneoff prices, a prices go to logical opportunity

recent intend then if you your and mean, a decrease in you've does asset debt. delivery that meaningful the I had reduce a reduction mean, leverage? And leverage year in reduce not before continue you occur take two continue last net in most values to newbuilds? to the I of to and half do

delivery will that strategy you be So two until potential take your of ships? the

debt become positive will since Yes, have expensive, be only company. now rates interest too way for reducing the

just Okay. And the environment I'm healthy rate on then seasonality, -- rates the with currently.

date time know if And rates you then and can we charter in your off? it available year-over-year secured do was with compared take maybe last tankers -- a quarter your this I expect don't So spun increase offline. time secured in to rate what equivalent current year you your and that spot the excluding have -- charter to equivalent last you rates rates, have the What year? handy,

as know, and had, would different that you different if because And I many of don't the ages you ships. sizes information. we be confused, I many, even have many many, have

number one good be going would on. So not of day what's much a

fourth you quarter-over-quarter have leverage, target All quarter right, so you to circling then on or it ideal But a amount just the leverage yes. but Okay. you that LPG? like have liquidity the usually an good also conduct increase still of available acquisitions? in And looks back do

we would years, XX%. anything as the four, the If say were rates was last low it below five

interest get the are Now would that lower, the high higher, and might say I very rates the better.

Harry. Thank Thank you, you.

Thank you.

next our to going we're question. Now take

Boston line a us Boston] question (ph) comes the moment. next the [Brad from give Just from And of Consulting.

line Your open. is Please question. ask your

decisions Do of Imperial listing, I questions reverse share Petroleum. can might around if and delisting investor if Petroleum quarter. the I more invest next both believe you. Petroleum avoid cetera, clarify are expense, split, in guess Harry, is StealthGas to -- And StealthGas? over the of affecting Imperial results if morning. month? the buybacks, et you doing Imperial as in Good you CEO the question you the Good be to so, of and what Thank have, you

on not or where a StealthGas, different there with with is board. Petroleum at Imperial comment all, strategy a StealthGas, different cannot We

So what we as you with we do nothing seen, might do to StealthGas, the company? have is has do with what other

Okay. Thank you.

to Please from [Operator Thank take Now you. Group. line And we're the standby. Instructions] our next going question. of the from comes next Maxim question Sullivan Tate

Your Please open. question. your is line ask

Thank you a follow-up. for allowing

scrapping comments obtain more Or still seeing environment? the or current On the current consider to your in may that ships do scrapping you your potentially environment, continue that this available? if rate will about scrapping ships can rates in operate ’XX you are you you have

have old will only it. -- old will try possible, We for scrap not and one we If that's we vessel very further and sell trading.

you. Thank Alright.

at Dear Instructions] questions there no this [Operator are time. Thank you. further speakers

having our to would at We ‘XX. with results in in to fourth for conference today call we with forward our our and and your us joining call Thank and like company, look thank quarter next for again ’XX trust our you. for us February you conference you interest

you conclude does conference Thank participating. our for today. That for

You disconnect. Have day. may now nice all a