GASS - Earnings call transcript Q1 2022

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Operator

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

Michael Jolliffe

Jolliffe handling our Chief much, This Officer financial and our very aspects. Good who Executive Relations, today and will to Sistovaris, Michael the be call Vafias, you on Investor joining Harry Thank is Konstantinos me the Nadia. is morning. discuss

StealthGas current you also views our our you with presentation, moment implicitly respect United stated the this results statements, I improvement quoted, LPG that fantastic point remind we presentation. I and on that out disclaimer filings Commission. a commence saw as to forward-looking released amounts in first company, At will read two are year. compared we quarter to events which Before the which also could future of Securities pure and last we unless Risks like reflect earnings Exchange with to performance. clarified, in a we and this discussing Today, to the like be to further would are our slide first otherwise was all financial of for take if stage, trading quarter, dollars. would States all disclosed

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

LPG more quarter. three. Turning charters. vessels improved highlights in first particularly the the In area first continue of hence, summarize to quarter opportunity to on we we our trading and secure We an market, slide of took Europe, XXXX, faced the period in the

to also stable, was Asia secure in we market the hand, other more charters. period the managed On but

did to XX.X%, we off-hire of at days the utilization was last levels ships. as dock vessel had spot on operational of one aim we year, and similar dry it to a terms fleet experience to our at figure improve In

We days of earn chartered on contracted now subsequent excludes better of generating than on days quarter-on-quarter year-on-year, returns spot $XX ships. for an employment almost However, and revenues. spot vessels for our all of the in reduction total, days fleet venture that secured fleet remainder XX% time periods vessels on and we charters period the joint marked have XXXX. XX% XX% In million managing to

sale new activity and during the of owners. In two our previously completed the Gas Loyalty terms announced and the of Inspiration we purchase vessels, their to quarter, Eco the sale

In we on Gas XXXX cubic we in X,XXX the further entered for May an vessels sale vessel, meter for cash quarter, the current All delivered into Monarch, the agreement these our XX. built the our of LPG and trading, transactions again, addition, further oldest base. enhanced

$X $XX.X reduction million. is depreciation $X.X market fleet. year, of in our number the in million compared activity, quarter purchase the better quarter to the in our this mentioned, expenses, ships. that Looking having $XX.X to part million on voyage to of Overall, last million keep are operating fewer besides $XX.X ships, we the $X.X million in expense, we revenues an mind see where spot quarters seen In the year-on-year rise that vessels we be briefly despite million was result at in there a was fewer and last reduction million spin-off can a the in are due XXXX, one $X.X million, no of the of into December four tankers. any fleet, the lower partly our need comparing vessels one the improvement came to in four revenues a saw effects LPGs and $XX.X that last TCE as longer in financial revenues were included XXXX, the absence in sale there in and and Where the fewer tanker at highlights, a year's tankers can including the came where partly of in than and to

was to the of adjusted with for for and one to four charges, compared profit $X.X excluding period $X.X net we quarter Our $X.X million quarter basis, $X.X profits the quarter last million impairment million net billion XXXX in Whilst year. ended million in the XXXX. compared $X.X from an same quarter

of the adjusted to year during through equivalents $X.XX. of time same cash, and one restricted to this or from of mainly quarter an the for income of cash $XX.X Our quarter. at the six $XX.X million manage last refinancing end the million including EPS XXXX quarter completed cash sales our and the $XX.X adjusted the million corresponds increasing first We the at while vessels at end we

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

four slide to on move us our for update. fleet employment Let

vessels rates. types last of two of done LPG spot of vessels, charter and our delivery At venture end bareboat, we had have successfully four in extensions. two terms the on announcement, of as May fleet of charter only towards on In weeks. new vessels the market. quarter were previous two These out expire of bareboat a from the operating XXXX, spot we time two year, charters, the their or charters improved at and Since get seven or the and and coming all in bareboat these and will the end bareboat on we on new our vessels, market, fixtures excluding we remaining charters, XX previously XX one, charters of joint similar concluded within involved eight

is Our XX%. XXXX period in remainder of of coverage the order for the

vessels received five, I expected improved We an joint $XX performance we our two ventures, previous $XX within to to like of which quarter. as all in now our the last would call, Since are In of where to forward, time remainder to going provide have close saw to also update similar slide secured the contributing chartered. million revenues both figures million million $X.X XXXX, our to bottom-line. be of is

LPG our joint while comprising venture, one-year smaller its charter. of medium vessels two joint time more under vessels of first plus Bremen one was at a chartered gas for gas Gaschem months, venture, charter for Our time majority the second in in construction. carrier defiance which three comprises

we During joint the flow. received our $X the quarter, in dividends cash million from ventures improving first

drug finance after delivery base the prices these to We combined of venture joint be has arrangements cash-in-hand a in arranged. sale the any medium XXXX have medium related of across million. to the sold. and fund to gas newbuilding the enough be in to all all, the acquisition sectors cash about with one underpins rise any carriers vessel year as to financing $XX last together CapEx not After do proceeds Our includes the of venture solid have carrier expect the gas newbuilding itself

as of our trade of positioning vessels, company and fleet terms distribution vessels focuses of and This XX is May JV X, the in vessels of trade In our our excluding two Currently slide and and a vessels in our XXXX. Caribbean, US geography snapshot on Europe, the graph our Middle-Far local of half the regional gas. trade Africa. three East of XX vessels in fleet, trade in in

the Given the market in Europe, to we expect opportunities financial turn performance. Konstantinos better my there vessels colleague, our will the would now Sistovaris for if I more over to arise. call see moving

Konstantinos Sistovaris

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

revenues a last where to year. marking came period same same million, Let see of vessels slide in the the spot partly due in Voyage market. at statement X, income us the against first $X.X the the to period for compared $XX.X X% decrease the quarter previous to XXXX million, of about we the turn of fewer of year,

compared the in base. due XXXX note voyage partly four in albeit and OpEx would $X.X higher in and same XX% all given by fleet partly decreased XX% This to was this were versus vessels, LPGs compared the that XXXX voyage of to about to responsible market, these of pressures, also to same We along above, about million, of the a decrease for last to order of revenues had last million actually Voyage number saw by cost of the quarter face levels be XXXX. the in the decreased $X.X partly last stable pandemic. we the during due result of a year, first where we we in Operating a absence our fewer to first were are chartered to $XX.X increase tankers million, voyage XX.X vessels, year, period the X% of the decrease revenues and starting million the market spot crew the expenses vessels as TCE vessels spot continue in in in fewer Based all the the average average costs costs to should due on to for due the to of particularly net the we Our XXXX number $XX.X of our the reduction results in vessels. lower where cost up. the positive handysize significant period effect, year. COVID-XX expenses of the quarter from XX.X QX that rates base exclude due compared a at

first of costs, $X.X of terms drydocking million In one XXXX vessel. we had quarter the in from

a to Depreciation from to drydock year. number that vessels. in decrease $X.X large We $X due expect million five another is million the decrease the the another of to item vessels saw during

to cost loss costs partly place the current the Monarch there sale $X.X partly comparable the on to related quarter, Inspiration. due to the was debt average million in of due during the Gas Gas the due charge the X.X periods, million to our the $X.X the and from an decrease impairment million, considerably finance in of Interest million During reduction also of margins. previous quarter, decrease took the the sale in the declined that in and average loan to $X.X and the

reverse increases to the of we the expect We interest the trend in start future seeing effect recent rate this the as coming in will quarters.

ended of with a and of of and quarter mega last million, vessel adjusted of impairment result that income sales to income we excluding an $X.XX, year. the per $X.X is the period analyzed the same above, increase a ten-fold net first share corresponding net of of the a $X.X million, all compared As $X.XX of earnings points XXXX to

sheet in balance our slide at X. Looking

Our fourth increase in XXXX. the quarter and sales $XX.X XX.X cash liquidity, secondarily the from of in the XXXX operations first the payables. liquidity quarter million including and the an increase of in substantial $XX.X from primarily the increase The from restricted in vessel re-financings the and in end at of of quarter and came million was million, a order

investments $X is from received also during million our investments million. overall JV in $XXX We JV debt $XX levels the total The end the million, of is a our The similar quarter. to the first dividend at of year. our value last outstanding

a quarter to profile have year ago. amortization region quarter, was and $X.X in briefly discuss forward this be with to we Concluding at structure. expect million debt going it the slide per expenditure X, of while capital debt our moment. capital per our we close planned Furthermore, our commentary We no will $XX million financial

since beginning up we portfolio loan before, important project of underwent and first, in As XXXX balloon mentioned vessels, the our XXXX, until and thus deferring succeeding payments. the of reshaping refinancing XX February

now that took place first XXXX; second, our Our an in $XX about enhancing our by million, and in March is February. balloon payment refinancing outcome cash of due free last

last our the our reduced net margin end the slightly low to all of unencumbered average increased remained gearing new increased to liquidity. vessels. lower of loans our continue as we but also debt, to the the were year, six previous loan Monarch, than ones. levels We the have sale Compared Gas After due at margin the we

first a swap interest new also of rate arrangement entered to hedge the the quarter, part During into we exposure.

to debt. Vafias, who CEO, will will a our of in the hedges our interest hand company for are place over As now you discuss Harry and market I XX% rate result, outlook.

Harry Vafias

in Going some that the the XX, given performance. difficult with to ongoing pandemic, foresee to we tensions current Ukraine, insight geopolitical Needless Slide it's providing are markets very LPG market. COVID-XX on our the along on say

its over LPG few ramped been On during bigger China the side, US. largest a XX%, exporter has has its up first positive imports LPG exports share from of XXXX, the the months importing and the of of the US,

its results a the as a with However, the X% China, policies. COVID-XX quarter in followed year first imports decreased decrease. the year-on-year of It of has

continue of filled is in to increased main We the expect that demand slack being will the this to imports that driver. But US Middle mainly India, being, redirected a and Asian India, LPG so Europe. will by particularly China time be imports some source from surge by demand other has its XX%. such from been the countries, for LPG rise East, reverse the from

we see the from future. it's possible of Now XX% the increased LPG European US, volumes imports in and are

of pretty on European to has is in the petrochemical LPGs have small intra-regional Northwestern LPG demand. for held a imports circumstances. LPG and and large sanctioned a though Europe trade continued The even are the difficulties has of the years ahead Ukraine In expected addition, the market Russia, trade in to rising well increase Europe US LPG in imports. war in created given not we back speak

expect LPG and further market done we It's The result, key Finland a or the shares soon. have that far impact We fundamentals yet not and the to on or present counted our what LPG their be could war from Russian XX, Russian a evolution. fuels. will European imports will can end of small As so from dependency only with usually switching other to clear try imports. market alternative in of we Ukraine, disruption the Slide commencing biggest through importers Poland, reduce be. railcars, been sources countries either hope

XXXX, slightly, year-over-year, as in quarter-on-quarter not QX trading as the sub-segments an basis, for LPG witnessed rates small we as all a improved vessels large on the particularly During West. increase

cargos at to tight healthy and a East in have for correction in to owners couple of and trade, the activities Looking small and vessels leave again. withdrawn doesn't But order be vessels. until Suez, take Asia it active to times, balanced, of quite At more enjoyed market market state. remained to area market unavailability things spot the China down around We than the the winter number and the then, side. slow the boost things been give petchem of the have And the will spot China West more. expect to locked market due the well time down Shanghai. in somehow. through a the a into on months the once healthy to market have continuing leading market been are Suez, especially spring quite tight a active, since the less don't reopening of Hopefully, is summer in LPG

turnaround maintenance the now petchem However, plant. are the going we to season for

we change don't expect of in next months. the too couple So much for market the

lower, On the rates period level. has generally but been remained activity side, have healthy a at

have, We to last months. since going and the in vessels several leaving the five however, Atlantic Asia

has our been an XX in scrapping a in the There positive older for of reasonable the fleet The in look balance market continue we expect ships a elevator to fleet this overhang be later. promising. sooner continues over age, years keeping region. activity many core So keep to fundamentals or of which will

yard will regulations older it environmental for in trade. newbuilding activity finding also because surge partly prices with continues because New partly to vessels of make inflation difficulties ordering recent harder and have The the together a to be subdued availability globally. in risen

risky and make on related the matter regulations direction of lack environmental ordering decisions. clear to ships choices the of New emissions of and more fuel new a

to consider Slide are sub performance to favorable and company That XX per of X presents As fleet China there orders, scrapping. and published vessels Korea in recent XX Japan increase in translate since XXXX. beginning before our the until built XXXX. we of the order, end share annual the to be in in be delivered XX X.X%

will price XX, variables few the volatile market, affect outlining in oil share key Slide discount has very wider quarters other rises the and the albeit months it in Gas performance risen that at still behind NAV. Our stock trade we In the sector. in a lagged has past over ahead. a companies are to crude our

now and turmoil, situation quite China, market make especially to the situation predictions. Given in difficult current market it's with COVID in the Ukraine the

improvement to LPG a debt is sizable that, points we and quite we leverage have Our easily further diversified manageable fleet continue upon levels. that going market and can forward have any strong

the industrial have price for particularly we increase in may demand seen oil In addition, and for past, surge use. the LPG, as

as book, above Our fundamentals order we is of while are market XX% the a quite age. of solid years enjoy relatively fleet low XX industry

our asset in situation, structure. examined. the to the geopolitical our in the pressures shape, On seaborne Jolliffe global trade our the relying concluding LPG inflationary the while given upon to focus of Chairman, will our stronger. We to and -- our capital downside make become crisis, now the a recent be Regardless market will LPG period quarters border will adapt the and following our may feel on across confident pay fleet and will strengthen decision returns. At this remarks robust to pure-play LPG strong company our our Michael stage, StealthGas spectrum that off summarize for strategic cost

Michael Jolliffe

Harry. you, Thank

our as was best the the few are quarters over it We last for company with very today announced years. results of the we pleased one

Following pure that LPG various the consisted sizes. was the only fleet carriers StealthGas LPG this broader player quarter in to strategic of decision first market, the the become of a

During the years. managed was upward improving $X.X our trend, posting On capitalize, the market in continued adjusted EPS an many results of its one million for the and of LPG quarterly to profits quarter, quarter best basis, first we improved the $X.XX.

cost We contain future. the to that a for particularly That the push with the said, in pandemic, to to crew particularly challenging our ongoing with continue to base. war regards continue the prices geopolitical operate being creating and pressures, bunker we related also in managed more and cost situation Ukraine to and uncertainty COVID-XX still China, in environment

will as direction. market uncertainty all is Now interest the LPG inflationary seeking also a this rates. will benefit this trade pressures that and from of patterns as any remains result add be determined, How in affect and be we market shipping can change able rising whether a we to to still high economic is

reality, we especially Going times. in our market's cannot forward, predict turbulent such

which to we face. we our the any fundamentals, the disturbances might improvement market healthy structure will of potential in need our matter capital along rely, with strong no on rates LPG sizable market our strong first XXXX, However, quarter are points fleet,

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

please open So you. floor. the operator, Thank

Operator

participants, the Thank session. question. you. will question-and-answer begin Dear from The [Operator Jefferies. from ask Please, question line comes of we the your Instructions] now Robertson Chris first

Chris Robertson

and my morning, for taking thanks gentlemen, Good questions.

Harry Vafias

Good morning.

Chris Robertson

So it quarter? of drydockings this scheduled cadence year? days this How Can expectation during looks off-hire have total you completed your the many first around that? about you And kind the like seven year. talk what's were for

Harry Vafias

it's that depends drydockings, will open off-hire, calculate will also it country one on had drydockings a costs because off-hire. -- which in already, on huge that the easy where We because and the be to will And take China place. makes but if depend not for difference

think closer drydocking see dates. I that to we to So the have

Chris Robertson

in any happens to are lockdowns? XQ, yards the see or Are out what it during the trying you to wait easing China with

Harry Vafias

is hot, be to obviously, it cash. vessels market most on a it's As have China delay now open, that much try China We places. as I off-hire, allowed will any we reduction project on drydock. cheaper And as cost and is because does if don't big said, other by as than

Chris Robertson

during drydock And one it. Got one to it quarter, I of in that that Okay. during XQ. days XX for first believe the that that Was was was related off-hire vessel? XXX%

Harry Vafias

right. No, you e-mail can want on back come you, us check send to to an it. I think that's and We don't if

Chris Robertson

offline. what is I'll general Thanks NAV, that. you a sector, trading aside of improving NAV? in discount below kind Sure. for do still the you drive the with to LPG that think the a now market follow-up I narrowing the of improvement shares and going to guess, with market from

Harry Vafias

Consistent quarterly profits.

Chris Robertson

makes That it. sense. Got

me. it much you very That's Thank the guys. for time. Okay, for

Harry Vafias

you. Thank

Operator

your the comes Thank from question. Eric Please TowerView. The question you. from line ask of next Newman

Eric Newman

obviously Congratulations strong morning, quarter. on very good a Harry. Hey,

is you long-term my supportive know, capital allocation question shareholders. As we've also. guys been And very on

historically pretty You been opportunistic. guys have

to when gotten stock value. book sold You close it's

you've past report now past and me, shares, this meaningful at The at share, your market open impairments the with stock balance. launched and including the But we in pretty ships, a quarter tender. even $XX.XX this shares repurchased to excuse continued minimal including $X.XX. quarter is per now -- cash sell have and trades value book You've

and what if of book how does level, the truly uses a Thanks, So, to operate or stock? prices, given sense to this And why not better make repurchase guys. the repurchase at salable are doesn't at Appreciate these amount is it the it business? uncertainty anywhere near if it. make sense meaningful stock to even cash continue of continued to uncertainty

Harry Vafias

Eric. you, Thank

As or upside the you we the quick stock know on past, results. very downside. I investors the see these announced to to levels, just shareholder from same mistake And still do either well, that that or the in is we want base. investors if psychology the which biggest have because judge are not, and most too good guess at that seen is the persists they mentality The market

then three quarters if the and crystallized emphasizes where did we've level, still obviously, numbers Now, your be good about could NAV is the results good indeed ships, you and that, three are numbers our not we again not fact this people quarters And will and very you've have huge those previous both We is turnaround. talked indeed, point and cheap. two, they stock price were the about. were about at absolutely the old had levels, disappointed NAV, young have seen and we which sold this But right. at that we with expect

up Our the was shareholder. know we'll that, On the stock not liquid. end I'm this the of of quarter is right don't largest But top net decisions. take very income forget, the the you day, in XXX%.

as of And But to is to stock as had we continue cash you. COVID tender you said, best and for we is now, many companies did big course, course, we've for it, the buy quarters done we've which point all what the balance before. I before a think it offer would guts the If your do. best have times, accurate. be have done if we obviously, we don't and is do of me So, as cost will of is profitable it these never actually in

that it XXXX-XXXX. patient So, the the in upturn be happened rewarded as previous in will were shareholders

Eric Newman

Thanks Harry. Appreciate it.

Harry Vafias

Thank you, Eric.

Operator

Instructions] [Operator you. Thank

Harry Vafias

other are that questions. there I questions, see no

QX forward joining like much. So, our for at August. looking XXXX call to you conference to we very for are having our you again Thank results we'd us and you thank us in

Operator

for participating. today. you Thank concludes conference That our for

all Have day. nice disconnect. may You a

StealthGas (GASS) 26 May 222022 Q1 Earnings call transcript