SOURCE: StealthGas Inc.

November 14, 2005 10:18 ET

STEALTHGAS INC. Reports Third Quarter and Nine-Month 2005 Results

ATHENS, GREECE -- (MARKET WIRE) -- November 14, 2005 -- STEALTHGAS INC. (NASDAQ: GASS) today announced unaudited operating results for the third quarter and for the nine-month period ended September 30, 2005.

STEALTHGAS INC. was incorporated in December 2004, and its initial public offering of common stock was completed on October 12, 2005. The company offered 8,000,000 shares of its common stock at a price to the public of $14.50 per share with net proceeds before expenses of approximately $109 million.

Third Quarter 2005 Results:

For the third quarter ended September 30, 2005, revenues amounted to $6.9 million and net income for the third quarter was $3.6 million. Earnings per share basic and diluted for the third quarter, calculated on 6,000,000 shares outstanding, were $0.60. EBITDA for the third quarter of 2005 was $5.1 million.

An average of 9 vessels were owned and operated in the third quarter 2005 earning an average time-charter-equivalent rate of approximately $8,027 per day.

Nine Months 2005 Results:

For the nine-month period ended September 30, 2005, revenues amounted to $16.5 million and net income amounted to $7.7 million. Earnings per share basic and diluted for the nine-month period ended September 30, 2005, calculated on 6,000,000 shares outstanding, were $1.28. EBITDA for the nine-month period ended September 30, 2005 was $10.9 million.

An average of 7.3 vessels were owned and operated in the nine-month period ended September 30, 2005 earning an average time-charter-equivalent rate of approximately $7,948 per day.

CEO Harry Vafias commented: "We are very pleased to report strong results for the third quarter of 2005 and the nine-month period ended September 30, 2005, a period during which we were at the initial stages of building our company and expanding its fleet.

Charter rates for handysize LPG carriers -- those with a cargo carrying capacity between 3,000 and 8,000 cbm -- were fairly stable over the summer and into the beginning of September. For example a 3,500 semi-refrigerated vessel earned $9,500 per day during the summer while so far in the fourth quarter charter rates for this type of vessel averaged $10,000 per day. At the present time charter rates for both pressurized and semi-refrigerated ships are stronger in the Mediterranean and European regions than in the Far East and we expect this trend to continue. All but one of our vessels are employed on time charters and we are looking forward to renewing employment contracts on certain vessels which end in the 1st quarter of 2006. We believe that charter rates may strengthen further during the winter months thereby enabling us to renew these expiring charters and enter into additional contracts for our fleet at better or at least comparable levels.

As of September 30, 2005, STEALTHGAS had a fleet of 9 LPG carriers and we had identified, as detailed in the IPO Prospectus, an additional 10 vessels, for acquisition. As of today, November 14, 2005, our fleet has already expanded to 16 vessels and by the end of November 2005 we expect to take delivery of another 2 vessels, with the last delivery occurring in February 2006, thereby completing the acquisition of the then-identified fleet of 19 LPG carriers.

Furthermore, we are also proceeding with further expansion. In this context today we have announced the agreement to acquire one additional vessel, beyond the identified fleet, with expected delivery by the end of November 2005, which will expand the fleet to a total of 20 vessels. This additional vessel, "Catterick," is a Fully-Pressurized (F.P.) LPG carrier built in Japan in 1995 with a capacity of 5,000 cbm and is acquired for a total consideration of $12.75 million. Consistent with our strategy to seek employment of our vessels under time charters, it will be immediately deployed under a time charter with a major gas trader for a period of 14 months ending in February 2007 and with a monthly rate of $300,000.

So, at the beginning of December 2005, with 19 out of the 20 vessels delivered to us, STEALTHGAS will be in the position to benefit from the earnings potential of nearly the whole fleet."

CFO Andrew Simmons commented: "STEALTHGAS has so far utilized $92 million of the net IPO proceeds, before expenses, of $109 million to acquire seven of the ten identified vessels. As previously mentioned a further two identified vessels will be delivered by the end of November and the last identified vessel in February 2006.

Furthermore, during October 2005 we negotiated a $50 million ten-year term secured credit facility with DnB Nord Bank to facilitate further vessel acquisitions. We consider the terms achieved by us to be highly competitive and they are favorable."

Current Fleet Profile

The table below describes our fleet development and deployment as of today:

Vessel    Vessel  Vessel  Year    Delivered   Employ-   Charter     Monthly
          Size    Type    Built   To GASS     ment      Expiration  Rate
          (cbm)                               Status                (1*) $

CURRENT FLEET (Initial Fleet plus Identified Vessels already delivered
 to GASS)

Gas                                           Time
 Cathar   7,517   F.P.    2001    Oct 2005     Charter  Feb 2006    335,000
Gas Chios 6,562   F.P.    1991    Oct 2005    Time      Feb 2006    300,000
                                               Charter
Gas
 Marathon 6,550   F.P.    1995    Nov 2005    Bareboat  Oct 2007    220,000
Gas                                           Time
 Amazon   6,526   F.P.    1992    May 2005     Charter  May 2006    420,000
Gas                                           Time
 Emperor  5,013   F.P.    1995    Feb 2005     Charter  Feb 2006    350,000
Birgit
 Kosan    5,012   F.P.    1994    April 2005  Bareboat  April 2007  190,000
Gas Cour-                                     Time
 chevel   4,109   S.R.    1991    Nov 2004     Charter  Jan 2006    335,000
Gas Sin-                                      Time
 cerity   4,100   F.P.    2000    Nov 2005     Charter  July 2006   285,000
Gas                                           Time
 Prophet  3,556   F.P.    1996    Oct 2004     Charter  Jan 2006    253,750
Gas                                           Time
 Shangai  3,526   F.P.    1999    Dec 2004     Charter  Feb 2006    275,000
Gas                                           Time
 Legacy   3,500   F.P.    1998    Oct 2005     Charter  April 2007  250,000
Gas Arctic3,434   S.R.    1992    Apr 2005    Bareboat  April 2009  190,000
Gas Ice   3,434   S.R.    1991    Apr 2005    Bareboat  April 2008  174,250
Gas
 Crystal  3,211   S.R.    1990    Nov 2005    Spot      N/A
Gas                                           Time
 Prodigy  3,014   F.P.    1995    Oct 2005     Charter  March 2006  125,000
Gas Tiny  1,320   S.R.    1991    Oct 2004    Time      Nov 2006    120,000
                                               Charter
Subtotal
 - 16
 vessels  70,384
REMAINING IDENTIFIED VESSELS (with expected delivery period)
Sweet                                         Time      May/
 Dream(2) 5,018   F.P.    1997    Nov 2005     Charter   June 2007  295,000
Gas
 Eternity 3,500   F.P.    1998    Feb 2006    Spot      N/A
Gas                                           Time
 Oracle   3,014   F.P.    1990    Nov 2005     Charter  May 2006    118,000
Subtotal
 - 3
 vessels  11,532
ADDITIONAL VESSELS (with expected delivery period)
Catterick 5,000   F.P.    1995    Nov 2005    Time      Feb 2007    300,000
                                               Charter
FLEET
 TOTAL
20        86,916
 VESSELS   cbm

      -    F.P.: Fully Pressurized
      -    S.R.: Semi-Refrigerated
      -    (1): To calculate daily rate divide by 30.4
      -    (2): Sweet Dream is under a bareboat charter with a rate of
           $195,000 per month ending Dec 2005/Jan 2006. The time charter in
           the table commences thereafter.
EBITDA Reconciliation

STEALTHGAS INC. considers EBITDA to represent net earnings before interest, taxes, depreciation and amortization. EBITDA does not represent and should not be considered as an alternative to net income or cash flow from operations, as determined by United States generally accepted accounting principles, or U.S. GAAP, and our calculation of EBITDA may not be comparable to that reported by other companies. EBITDA is included herein because it is a basis upon which we assess our liquidity position and because we believe that it presents useful information to investors regarding a company's ability to service and/or incur indebtedness. The Company's definition of EBITDA may not be the same as that used by other companies in the shipping or other industries.

(figures in US $)
                                          Quarter ended   Nine Months ended
                                          Sept. 30, 2005    Sept. 30, 2005
                                          --------------    --------------
Net Cash Provided by
 (Used in) Operating
 Activities                                    $5,474,971      $13,690,451
Net increase in current
 assets, excluding
 cash                                             725,598          (81,781)

Net (increase) in current
 liabilities, excluding
 current portion of
 long-term debt                                (1,841,001)      (3,270,342)

Non-cash G&A expenses                             (48,750)        (243,750)

Interest income                                  (128,137)        (317,370)

Interest and finance costs                        599,188        1,161,345

Amortization of finance fees                       (4,070)         (14,812)

Profit/(Loss) on derivatives                      315,300          (74,000)

EBITDA                                         $5,093,099      $10,849,741


(figures in US $)                         Quarter ended   Nine Months ended
                                          Sept. 30, 2005    Sept. 30, 2005
                                          --------------    --------------

Net Income                                     $3,623,533       $7,673,032
Plus net interest expense                         471,051          843,975
Plus depreciation                                 998,515        2,332,734
EBITDA                                         $5,093,099      $10,849,741


Fleet Data

FLEET DATA                                  Third Quarter      Nine Months
                                            2005               2005
                                            -------------      -----------
Average number of
 vessels (1)                                          9.0              7.3
Total calendar days
 for fleet (2)                                        828            1,995
Total voyage days
 for fleet (3)                                        828            1,995
Fleet utilization (4)                                 100%             100%
Total time charter
 days for fleet (5)                                   828            1,986
Total spot market
 days for fleet (6)                                     0                9


AVERAGE DAILY RESULTS                       Third Quarter      Nine Months
                                            2005               2005
                                            -------------      -----------

Time Charter Equivalent - TCE (7)                  $8,027           $7,948
Vessel operating expenses (8)                       1,809            1,972
Management fees                                       302              320
General and administrative expenses                   137              174
Total vessel operating expenses (9)                $2,248           $2,466
1) Average number of vessels is the number of vessels that constituted our fleet for the relevant period, as measured by the sum of the number of days each vessel was a part of our fleet during the period divided by the number of calendar days in that period.

2) Total calendar days are the total days the vessels were in our possession for the relevant period including off-hire days associated with major repairs, drydockings or special or intermediate surveys.

3) Total voyage days for fleet reflect the total days the vessels were in our possession for the relevant period net of off-hire days associated with major repairs, drydocks or special or intermediate surveys.

4) Fleet utilization is the percentage of time that our vessels were available for revenue generating voyage days, and is determined by dividing voyage days by fleet calendar days for the relevant period.

5) Total time charter days for fleet are the number of voyage days the vessels in our fleet operated on time charters for the relevant period.

6) Total spot market charter days for fleet are the number of voyage days the vessels in our fleet operated on spot market charters for the relevant period.

7) Time charter equivalent, or TCE, is a measure of the average daily revenue performance of a vessel on a per voyage basis. Our method of calculating TCE is consistent with industry standards and is determined by dividing voyage revenues (net of voyage expenses) by voyage days for the relevant time period. Voyage expenses primarily consist of port, canal and fuel costs that are unique to a particular voyage, which would otherwise be paid by the charterer under a time charter contract, as well as commissions. TCE is a standard shipping industry performance measure used primarily to compare period-to-period changes in a shipping company's performance despite changes in the mix of charter types (i.e., spot charters, time charters and bareboat charters) under which the vessels may be employed between the periods.

8) Vessel operating expenses, which include crew costs, provisions, deck and engine stores, lubricating oil, insurance, maintenance and repairs is calculated by dividing vessel operating expenses by fleet calendar days for the relevant time period.

9) Total vessel operating expenses, or TVOE, is a measurement of our total expenses associated with operating our vessels. TVOE is the sum of vessel operating expenses and general and administrative expenses. Daily TVOE is calculated by dividing TVOE by fleet calendar days for the relevant time period.

Conference Call and Webcast:

As already announced, today, Monday, November 14, 2005 at 9:30 AM EST, the company's management will host a conference call to discuss the results and the company's operations and outlook.

Conference Call details:

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1866 819 7111(from the US), 0800 953 0329 (from the UK) or +44 (0) 1452 542 301 (from outside the US). Please quote "STEALTHGAS."

In case of any problem with the above numbers, please dial 1866 869 2352 (from the US), 800 694 1449 (from the UK) or +44 (0) 1452 560 304 (from outside the US). Quote "STEALTHGAS."

A telephonic replay of the conference call will be available until November 18, 2005 by dialing 1866 247 4222 (from the US), 0800 953 1533 (from the UK) or +44 1452 550 000 (from outside the US). Access Code: 2201616#

Slides and audio webcast:

There will also be a live -- and then archived -- webcast of the conference call, through the internet through the STEALTHGAS INC. website (www.stealthgas.com). Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.



                               STEALTHGAS INC.
                      Consolidated Statements of Income
                   for the quarter ended September 30, 2005


(Expressed in United States Dollars)
                                           Third Quarter ended
                                            September 30, 2005
                                                   [UNAUDITED]
Revenues
         Voyage revenues                            $6,894,976
                                                    ----------

Expenses
         Voyage expenses                               248,850
         Vessels' operating expenses                 1,498,313
         Management fees                               249,780
         General and administrative expenses           113,380
         Depreciation                                  998,515
                                                    ----------
Total expenses                                       3,108,838
                                                    ----------

Income from operations                               3,786,138
                                                    ----------

Other revenues and (expense)
         Interest and finance costs, net              (599,188)
         Income/Loss on derivatives                    315,300
         Interest income                               128,137
         Foreign exchange loss                          (6,854)
                                                    ----------
Other expenses, net                                   (162,605)
                                                    ----------

Net income                                          $3,623,533
                                                    ==========

Earnings per share, basic and diluted                    $0.60
                                                    ==========

Weighted average number of shares, outstanding       6,000,000
                                                    ==========


                           STEALTHGAS INC.
                   Consolidated Statements of Income
               for the nine months ended September 30, 2005


(Expressed in United States Dollars)
                                               Nine months ended
                                              September 30, 2005
                                                     [UNAUDITED]

Revenues
         Voyage revenues                             $16,487,581
                                                     -----------

Expenses
         Voyage expenses                                 632,300
         Vessels' operating expenses                   3,934,084
         Management fees                                 638,395
         General and administrative expenses             347,660
         Depreciation                                  2,332,734
                                                     -----------
Total expenses                                         7,885,173
                                                     -----------

Income from operations                                 8,602,408
                                                     -----------

Other revenues and (expense)
         Interest and finance costs, net              (1,161,345)
         Income/Loss on derivatives                      (74,000)
         Interest income                                 317,370
         Foreign exchange loss                           (11,401)
                                                     -----------
Other expenses, net                                     (929,376)
                                                     -----------

Net income                                            $7,673,032
                                                     ===========

Earnings per share, basic and diluted                      $1.28
                                                     ===========

Weighted average number of shares, outstanding         6,000,000
                                                     ===========


                StealthGas Inc.
          Consolidated Balance Sheets
  December 31, 2004 and September 30, 2005 (unaudited)
          (Expressed in United States Dollars)
                                                        Historical
                                                December 31,  September 30,
                                                       2004         2005
                                                   ----------   ----------
                                                               [UNAUDITED]
Assets
Current assets
  Cash and cash equivalents                                 -   15,280,897
  Receivables from related party                    1,075,559            -
  Trade receivables, net                               19,623            -
  Inventories                                         116,291      116,055
  Advances and prepayments                              9,130    1,022,767
  Deferred offering costs                                   -      620,338
                                                   ----------   ----------
Total current assets                                1,220,603   17,040,057
                                                   ----------   ----------

Non current assets
  Advances for vessels acquisitions                 1,905,282            -
  Vessels, net                                     29,385,182   79,896,106
  Deferred finance charges                                  -      147,188
                                                   ----------   ----------
Total non current assets                           31,290,464   80,043,294
                                                   ----------   ----------
Total assets                                       32,511,067   97,083,351
                                                   ----------   ----------

Liabilities and Stockholders' Equity
Current liabilities
  Payable to related parties                                -    1,853,755
  Trade accounts payable                              410,398      551,133
  Other accrued liabilities                           286,125    1,284,935
  Deferred income                                     476,413    1,373,793
  Current portion of long-term debt                         -    5,427,000
                                                   ----------   ----------

Total current liabilities                           1,172,936   10,490,616

Non current liabilities
  Derivative liability                                      -       74,000
  Long-term debt                                            -   43,635,750
                                                   ----------   ----------

Total liabilities                                   1,172,936   54,200,366
                                                   ----------   ----------

Stockholders' equity
  Capital stock 6,000,000 shares authorized and
    outstanding with a par value of $.01               60,000       60,000
        Additional paid-in capital                 31,018,456   44,890,278
        Retained earnings/(accumulated deficit)       259,675   (2,067,293)
Total stockholders' equity                         31,338,131   42,882,985
                                                   ----------   ----------
Total liabilities and stockholders' equity         32,511,067   97,083,351
                                                   ----------   ----------


                                   STEALTHGAS INC.
                        Consolidated Statements of Cash Flows

(Expressed in United States Dollars)
                                                              Nine Months
                                                                 Ended
                                                              September 30,
                                                                  2005
                                                               -----------
                                                               [UNAUDITED]
Cash flows from operating activities
  Net income for the period                                     $7,673,032

Items included in net income not affecting
  cash flows:
  Depreciation and amortization                                  2,347,546
  Non cash general and administrative expenses                     243,750
  Loss on derivative                                                74,000

Changes in operating assets and liabilities:
  (Increase) decrease in receivable from related party           1,075,559
  (Increase) decrease in trade receivables                          19,623
  (Increase) decrease in inventories                                   236
  (Increase) in advances and prepayments                        (1,013,637)
  Increase in payable to related parties                         1,853,755
  Increase in trade accounts payable                               140,735
  Increase in other accrued liabilities                            378,472
  Increase in deferred income                                      897,380
                                                               -----------
Net cash provided by operating activities                       13,690,451
                                                               -----------

Cash flows from investing activities
  Advances for vessels acquisitions                                      -
  Acquisition of vessels

Net cash used in investing activities                          (50,938,376)
                                                               -----------
Cash flows from financing activities
  Capital stock                                                          -
  Additional paid-in capital                                    13,628,072
  Dividends paid                                               (10,000,000)
  Deferred finance charges                                        (162,000)
  Loan repayment                                                (4,937,250)
  Proceeds from long-term debt                                  54,000,000
                                                               -----------
Net cash provided by financing activities                       52,528,822
                                                               -----------
Net Increase in cash and cash equivalents                       15,280,897
Cash and cash equivalents at beginning of period                         -
                                                               -----------
Cash and cash equivalents at end of period                     $15,280,897
                                                               ===========
Supplemental Cash Flow Information:
  Cash paid during the period for:
  Interest payments                                             $1,022,532
                                                               ===========
Disclosure of non-cash
 Items
Deferred offering costs                                            620,338
About STEALTHGAS INC.

Headquartered in Athens, Greece, STEALTHGAS INC. is a ship-owning company serving the liquefied petroleum gas (LPG) sector of the international shipping industry. STEALTHGAS INC. currently has a fleet of 16 LPG carriers, and intends to acquire 4 additional LPG carriers. Once these acquisitions are completed, STEALTHGAS INC.'s fleet will be composed of 20 LPG Carriers with a total capacity of 86,916 cubic meters (cbm). STEALTHGAS INC.'s shares are listed on NASDAQ and trade under the symbol "GASS."

Forward-Looking Statement

Matters discussed in this release may constitute forward-looking statements. Forward-looking statements reflect our current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in our records and other data available from third parties. Although STEALTHGAS INC. believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, STEALTHGAS INC. cannot assure you that it will achieve or accomplish these expectations, beliefs or projections. Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies and currencies, general market conditions, including changes in charterhire rates and vessel values, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled drydocking, changes in STEALTHGAS INC.'s operating expenses, including bunker prices, dry-docking and insurance costs, or actions taken by regulatory authorities, potential liability from pending or future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists.

Risks and uncertainties are further described in reports filed by STEALTHGAS INC. with the US Securities and Exchange Commission.

Visit our website at www.stealthgas.com

Contact Information

  • Company Contact:
    Andrew J. Simmons
    Chief Financial Officer
    StealthGas Inc.
    011-30-210-6250-001
    E-mail: Email Contact

    Investor Relations/Media:
    Nicolas Bornozis
    Capital Link, Inc. (New York)
    Tel. 212-661-7566
    E-mail: Email Contact