STEALTHGAS, 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 first quarter ended March 31, 2020.
OPERATIONAL AND FINANCIAL HIGHLIGHTS
- Operational utilization of 97.8% mainly due to few of our ships being in the spot market – equivalent to 8.4% of voyage days.
- Only 23 days of technical off hire of which 21 days related to a technical failure of one LPG vessel.
- Fleet calendar days, down 11.9% quarter over quarter to 3,811, attributed to our strategic fleet contraction.
- About 69% of fleet days secured on period charters for the remainder of 2020, with total fleet employment days for all subsequent periods representing approximately $126 million in contracted revenues. Period coverage for 2021 is currently 31%.
- Voyage revenues of $34.4 million in Q1 ’20, a decrease of $4.0 million compared to Q1 ’19 following the net reduction of our average owned fleet by four vessels, two fewer chartered-in vessels and one vessel- previously on time charter- which commenced a bareboat charter at the end of 2019.
- Net Income of $3.0 million for the first quarter of 2020, corresponding to an EPS of $0.08.
- EBITDA of $16.5 million in Q1 ’20 (48% EBITDA Margin), compared to $17.1 million in Q1 ’19 (45% EBITDA Margin).
- Low gearing, as debt to assets stands at 37.6%, largely due to our intense repayment schedule.
- Total cash of $42.6 million- expected to increase by about $25 million in Q2 ‘20 following the financing of the three Medium Gas Carriers owned by our newly established Joint Venture. This financing has already been concluded. The increase will be effected through a return of equity by the Joint Venture arrangement.
- Purchased, through a tender offer, almost 1.4 million of GASS shares for a total consideration of $2.9 million during April 2020.
First Quarter 2020 Results:
- Revenues for the three months ended March 31, 2020 amounted to $34.4 million, a decrease of $4.0 million, or 10.4%, compared to revenues of $38.4 million for the three months ended March 31, 2019, following the net reduction of our average owned fleet by four vessels, two fewer chartered-in vessels and one vessel- previously on time charter- which commenced a bareboat charter at the end of 2019.
- Voyage expenses and vessels’ operating expenses for the three months ended March 31, 2020 were $2.8 million and $13.2 million respectively, compared to $3.8 million and $12.9 million respectively, for the three months ended March 31, 2019. The $1.0 million decrease in voyage expenses was mainly attributed to a 43.2% quarter-on-quarter reduction of spot days. The 2.3% increase in vessels’ operating expenses compared to the same period of 2019, is a result of unexpected costs incurred –of about $1 million- relating to the technical damage of one LPG vessel. We expect that the majority of this amount will be covered by insurance and reimbursed in the upcoming quarters of this year.
- Drydocking costs for the three months ended March 31, 2020 and 2019 were $0.2 million and $0.2 million, respectively. Drydocking expenses during the first quarter of 2020 relate to a drydocking in progress, while the drydocking survey of one small LPG vessel was completed in the same period of 2019.
- General and Administrative expenses for the three months ended March 31, 2020 amounted to $0.6 million compared to $1.1 million for the same period of last year. This decrease is mainly attributed to the fact that for the three months ended March 31, 2019 share based compensation expense was incurred, which was not the case for the three months ended March 31, 2020 since all the shares awarded under our equity compensation plan vested in August 2019.
- Depreciation for the three months ended March 31, 2020 was $9.3 million, a $0.2 million decrease from $9.5 million for the same period of last year due to the decrease of the average number of our vessels.
- Interest and finance costs for the three months ended March 31, 2020 and 2019 were $4.2 million and $6.0 million, respectively. The $1.8 million decrease from the same period of last year is mostly due to the decrease of our indebtedness and the decline of LIBOR rates.
- As a result of the above, for the three months ended March 31, 2020, the Company reported Net
income of $3.0 million, compared to a net income of $2.0 million for the three months ended March 31, 2019. The weighted average number of shares for the three months ended March 31, 2020 and March 31, 2019 was 39.4 million and 39.9 million, respectively.
- Earnings per share, basic and diluted, for the three months ended March 31, 2020 amounted to $0.08 compared to earnings per share of $0.05 for the same period of last year.
- Adjusted net income was $3.1 million or $0.08 earnings per share for the three months ended March 31, 2020 compared to adjusted net income of $2.1 million or $0.05 earnings per share for the same period of last year.
- EBITDA for the three months ended March 31, 2020 amounted to $16.5 million. Reconciliations of Adjusted Net Income, EBITDA and Adjusted EBITDA to Net Income are set forth below.
- An average of 41.0 vessels were owned by the Company during the three months ended March 31, 2020, compared to 45.4 vessels for the same period of 2019.
Fleet Update Since Previous Announcement
The Company announced the conclusion of the following four chartering arrangements:
- § A two year time charter for its 2008 built product tanker, the Clean Thrasher, to a National Oil Company until June 2022.
- § A one year time charter for its 2010 built Aframax tanker, the Stealth Berana, to a National Oil Company until April 2021.
- § A six months time charter extension for its 2011 built LPG carrier, the Gas Elixir, to a Major Energy Trader until December 2020.
- § A four months time charter extension for its 1995 built LPG carrier, the Gas Pasha, to a Major Energy Trader until November 2020.
With these charters, the Company has total contracted revenues of approximately $126 million. Total anticipated voyage days of our fleet is 69% covered for the remainder of 2020 and currently, 31% for 2021.
Board Chairman Michael Jolliffe Commented
The first quarter of 2020 commenced quite promisingly as per our performance and profitability. Indeed, we are pleased that we generated net income of close to $3 million with a very strong operational utilization of 98%. However, the COVID- 19 outbreak has startled not only the shipping markets but also the global economy. Future periods are governed by a question mark around LPG demand and period activity. In the short run, market has deteriorated and although StealthGas is quite protected due to high period coverage and low debt no prediction can be made as for how long the COVID-19 pandemic will be the major global concern- severely affecting the whole of the shipping industry. A second wave of this pandemic outbreak may hit this winter, and StealthGas is already taking a defensive position in order to ride this storm as smoothly as possible.