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Stealthgas INC. Reports Fourth Quarter and Twelve Months 2011 Financial and Operating Results

Friday, 24 February 2012 | 00:00
STEALTHGAS INC., a ship-owning company primarily serving the liquefied petroleum gas (LPG) sector of the international shipping industry, announced yesterday its unaudited financial and operating results for the fourth quarter and twelve months ended December 31, 2011.Fourth Quarter 2011 Results: • Voyage revenues for the three months ended December 31, 2011, amounted to $28.9 million, a decrease of $0.2 million, or 0.7%, compared to voyage revenues of $29.1 million for the three months ended December 31, 2010.
• Voyage expenses and vessels' operating expenses for the three months ended December 31, 2011 were $4.7 million and $7.8 million, respectively, compared to $4.1 million and $9.7 million for the three months ended December 31, 2010. The increase of voyage expenses was due primarily to higher fuel costs for our vessels under spot charters. The decrease in vessels' operating expenses was due primarily to the higher number of vessels operating under bareboat charters in the 2011 period.
• Net income for the three months ended December 31, 2011 was $4.4 million, or $0.22 per share, an increase of $0.1 million, from net income of $4.3 million, or $0.21 per share for the three months ended December 31, 2010.
• Included in the fourth quarter results are net losses from interest rate and foreign exchange derivatives instruments of $0.2 million. This amount includes $1.2 million or $0.06 per share, of interest paid on recurring interest rate swap arrangements. Excluding non- recurring items, adjusted net income was $3.4 million or $0.17 per share compared to $2.4 million or $0.11 per share for the same period last year.
• Adjusted EBITDA for the three months ended December 31, 2011 amounted to $12.6 million. A reconciliation of adjusted EBITDA to Net Income is set forth below.
An average of 37 vessels were owned by the Company in the three months ended December 31, 2011, earning an average time-charter equivalent rate of approximately $7,404 per day as compared to 38 vessels, earning an average time-charter equivalent rate of $7,195 per day for the same period of 2010.
Twelve Months 2011 Results
• Voyage revenues for the twelve months ended December 31, 2011, amounted to $118.3 million an increase of $6.9 million, or 6.2%, from voyage revenues of $111.4 million for the twelve months ended December 31, 2010.
• Voyage expenses for the twelve months ended December 31, 2011 amounted to $17.8 million, an increase of $4.1 million, or 29.9%, from $13.7 million for the twelve months ended December 31, 2010. The increase in voyage expenses during the year was due to the increased activity of our vessels operating in the spot market and higher fuel costs. Vessels' operating expenses for the twelve months ended December 31, 2011 amounted to $36.6 million, a decrease of $1.7 million, or 4.4%, from operating expenses of $38.3 million for the twelve months ended December 31, 2010. The decrease in operating expenses during the year was primarily due to the increase in the number of vessel under bareboat charters.
• Net income for the twelve months ended December 31, 2011 was $8.5 million or $0.41 per share, a decrease of $2.6 million, from net income of $11.1 million, or $0.51 per share, for the twelve months ended December 31, 2010.
• Included in the twelve months ended December 31, 2011 results are losses incurred on interest rate and foreign exchange derivatives instruments of $2.9 million. This amount includes $5.5 million or $0.26 per share, on interest paid on recurring interest rate swap arrangements. The Company also realized a $5.7 million loss on sale of vessels. Excluding non-recurring items, adjusted net income was $11.6 million or $0.56 per share compared to $8.4 million or $0.39 per share for the twelve months ended December 31, 2010.
• Adjusted EBITDA for the twelve months ended December 31, 2011 amounted to $47.6 million. A reconciliation of adjusted EBITDA to Net Income is set forth below.
An average of 37.6 vessels were owned by the Company in the twelve months ended December 31, 2011, earning an average time-charter equivalent rate of approximately $7,514 per day as compared to 38.6 vessels, earning an average time-charter equivalent rate of $7,064 per day for the same period in 2010.
CEO Harry Vafias commented
We are pleased to announce another profitable quarter for the Company. Our financial and operational results have strengthened compared to the previous quarter and the same quarter of last year, reflective of the recovery in the LPG shipping market. As expected we have seen chartering activity pick up during the winter months. Our strategic focus on this niche LPG segment has allowed us to report solid results in contrast to the continued weakness in most shipping segments. Our adjusted net income for the fourth quarter was $3.4 million compared to $2.4 million for the same period last year, while for the twelve month period our adjusted net income was $11.6 million compared to last year's $8.4 million.
Voyage revenues for the fourth quarter were at similar levels to last year even though we had one less vessel in the fleet and five of our vessels were deployed on bareboat charters instead of time or voyage charters. As a result of the bareboat charters, which produce less revenues but also incur less expenses, we managed to decrease our operating expenses in the quarter by close to $2 million compared to last year.
During the fourth quarter we concluded a number of new charters for our vessels. In addition to the nine previously announced charters, we also extended the charters on the Lyne and Sir Ivor for an additional year. As a result the forward coverage of our revenues has increased to 75% for 2012 and 40% for 2013. We will continue to seek opportunities to profitably employ our vessels on long term charters and if such opportunities arise with respect to bareboat charters this could result in us being treated as a passive foreign investment company for US federal income tax purposes for 2012 or in subsequent years.
In terms of sale and purchase activity we sold the smallest vessel in our fleet, the 1,320cbm Gas Tiny, which was delivered to the buyers in January 2012. That same month we also took delivery on schedule from the shipyard of the 7,500cbm Gas Husky that we employed on a five year charter. Finally, we recently agreed to sell the 5,000cbm Gas Kalogeros to a third party. As with the sale of the Gas Tiny, we anticipate recognizing a gain from the sale of the Gas Kalogeros. We still have one newbuilding vessel to take delivery of, the 7,500cbm Gas Esco in order to conclude our newbuilding program. We have already arranged for financing and we are currently evaluating employment opportunities for this vessel. With the sale of older vessels over the past couple of years we have improved our cash position. We are now in a position to expand and renew our fleet and will be looking at opportunities for modern vessels.
Finally, I would like to remark that while we have a solid balance sheet, moderate leverage and circa $50 million in cash as of today, our market capitalization continues to be below $100 million.
Source: StealthGas Inc.
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