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For the three months ended March 31, 2010, the Company had a $1.7 million realized cash loss on interest rate swap arrangements and a $1.5 million unrealized non-cash loss on interest rate swap arrangements and foreign currency hedging arrangements. This compares to a realized cash loss of $1.1 million and an unrealized non-cash loss on interest rate swap arrangements and foreign currency hedging arrangements of $6.2 million for the three months ended March 31, 2009. As announced on May 5, 2010, during the three months ended March 31, 2010, the Company recorded a non-cash impairment loss of $0.08 million on a vessel delivered to new owners on April 9, 2010. Voyage and operating expenses for the three months ended March 31, 2010 were $3.2 million and $9.2 million, respectively, compared to $2.3 million and $8.6 million, respectively, for the three months ended March 31, 2009. These increases were due primarily to the increased level of spot market activity with 851 spot voyage days in the first quarter of 2010 compared to 501 spot voyage days in the same period last year. Under spot voyage charters we are responsible for all voyage expenses including fuel, port and canal fees. Adjusted EBITDA for the three months ended March 31, 2010 was $9.9 million, an increase of $1.3 million from Adjusted EBITDA of $8.6 million for the three months ended March 31, 2009. A reconciliation of Adjusted EBITDA to Net Income and to Net Cash Provided by Operating Activities is set forth below. Before the non-cash items as discussed above our net income was $3.2 million, or $0.14 per share for the three months ended March 31, 2010, as compared to a net income $6.4 million, or $0.29 per share, for the three months ended March 31, 2009, a decrease of $3.2 million or 50%. The decrease in operating net income after non-cash items is mainly attributable to higher dry docking expenses, increased voyage and operating expenses and a lower daily time charter equivalent rate as detailed below for the three months ended March 2010 as compared to the same period last year. An average of 41.0 vessels were owned by the Company in the three months ended March 31, 2010, earning an average time-charter equivalent rate of approximately $7,059 per day as compared to 40.8 vessels, earning an average time-charter equivalent rate of $7,344 per day for the same period of 2009. Common Stock Repurchase Programme As of May 11, 2010, the Company had completed the repurchase of 586,238 shares of its common stock under the common stock repurchase programme announced on March 22, 2010. Resignation of Mr. Thanassis Martinos Effective April 22, 2010, Mr. Thanassis Martinos resigned as an independent director of the Company due to business commitments. As a result, with effect from the April 22, 2010, the Company is not in compliance with NASDAQ listing rules 5605(b) (1) and 5605(c) (2) (A) regarding independent director and audit committee composition requirements and it received a letter on April 30, 2010 from the NASDAQ Stock Market in this regard. As such the Company has until October 19, 2010 to regain compliance with NASDAQ rules regarding the constitution of its Board of Directors and Audit Committee. CEO Harry Vafias commented “I am very pleased to report a significantly improved EBITDA performance for the Company in the first quarter of 2010 compared to both the same period last year and the difficult last quarter we had in 2009. This improvement comes despite a significant increase in dry docking expenses which in the first quarter of 2010 were 90% of the total dry docking expenses we incurred in 2009. In our press release for the first quarter of 2009 I stated that 2009 and probably beyond would be very challenging, this proved to be the case last year. I still fundamentally stand by this statement, and while we are hopeful that market conditions will improve as we move through 2010, and indeed we saw some seasonal improvement in the first quarter of this year, I still expect 2010 to in the main remain “challenging” as I said a year ago. As we announced last week and earlier in the year we have sold five of our older and smaller LPG vessels with most sales being completed at prices close to their book value. As I said in our press release last week these sales continue to underline the relative steadiness of our core sector and the viability of the net asset value of our company, which on a price to NAV basis continues to be under-appreciated by the market. These sales have enhanced our cash position and also reduced our debt level, from what was already a relatively conservative level. In 2010 we will continue to be highly diligent regarding our operational costs and to position the Company to take delivery of the five LPG vessels we have on order for delivery in 2011 and 2012 when there is an expectation that our core LPG market sector will improve. We may also, due to our strong financial base, where we see value, invest in other sound asset classes within the shipping sector, where we feel we can take advantage of attractively priced assets becoming available. We are pleased to have made a sound start to the year, and although we remain cautious regarding the near term future from a trading stand point, the measures taken during 2009 and in the early part of this year will, I believe, prove over time to have been well judged. We continue to look forward with confidence, and to the possibility of the investor community recognizing the true value and attractiveness of our company, particularly based upon its current valuation. Finally I want to extend my thanks to Mr. Thanassis Martinos for his guidance and wisdom during the formative years of our Company. We are sorry that, due to his heavy other business commitments, he has decided to resign from our board and we have reluctantly accepted his resignation. We wish him well for the future.” CFO Andrew Simmons commented “Following the vessel sales as previously announced, we have increased our liquidity with circa $50 million of free cash on our balance sheet and a conservative net debt to capitalization ratio of 43%. We continue to see significant levels of interest from both our existing and new banks in regard to the financing for the five new building LPG vessels that will join the fleet in 2011 and 2012. Our conservative financial structure and its attractiveness to the banking community will, we believe, allow us to make timely and opportunistic investments if such opportunities present themselves as we move forward.” Quarterly Dividend: At today’s meeting, the Company’s Board of Directors decided to continue the suspension of dividend payments to shareholders. Detailed report at: www.stealthgas.com StealthGas Inc. Press Release
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Stealthgas Inc. reports first quarter 2010 financial and operating results