StealthGas's Q2 2025: Contradictions Emerge on Debt Reduction, Fleet Strategy, and LPG Market Outlook

Date of Call: August 25, 2025

Financials Results

• Revenue: $47.2M, up 13% YOY (record quarterly revenue); 6-month revenue $89.2M (record)
• EPS: $0.55 reported, $0.59 adjusted; adjusted net income $21.7M (35% higher sequentially, ~20% lower YOY); net income $20.4M, down 21% YOY

Guidance:

• Maintain over 70% period coverage for 2025; secured about $48M for the remainder of the year and ~$150M in revenues through 2027.
• Expect chartering activity to pick up in Q4 as seasonality improves.
• Completed deleveraging: all fully owned vessels debt-free after repaying $86M in 2025 and ~$348M since 2023.
• Eco Wizard out of service; temporary repairs expected ~1 month, vessel historically contributed ~8% of revenues and will reduce near-term revenue.
• Continue preferring period charters and opportunistic sale/replacement of older tonnage.

Business Commentary:

* Revenue and Profitability Growth: - StealthGas Inc. reported record revenue of $47.2 million for Q2 2025, up 13% year-on-year. - The growth was driven by strong performance in commercial operations and high period coverage, despite increased trade frictions.

• Debt Repayment and Financial Stability:
• The company successfully completed its debt repayment strategy, reducing the total debt to $0 by July 2025.

• This was achieved by using $348 million since 2023, including $86 million in 2025, enabling significant interest cost savings and increased financial agility.

• Fleet Management and Strategic Adjustments:

• Over 70% of the fleet is now trading in Europe and the Mediterranean, marking a significant shift from the past when half the fleet was located in the East.

• This strategic adjustment is due to the premium obtained from trading West of Suez and the desire to compete with companies adhering to high standards in vessel maintenance.

• LPG Market Dynamics:

• Global LPG exports continued to grow at 6.6% for the first 6 months of 2025, driven by increases in U.S. exports and expansions in Middle Eastern production.

• Short-term uncertainties due to trade disputes, particularly for ethane exports, have been resolved, allowing for a more stable market outlook.

• Challenges and Incident Response:

• StealthGas experienced an unfortunate incident involving explosions on the LPG carrier Eco Wizard, its second such incident, leading to temporary off-grid status.
• While the causes are being investigated, the company is committed to resolving the matter swiftly to minimize revenue impact, affecting approximately 8% of revenues in the first half of 2025.

Sentiment Analysis:

Overall Tone: Positive

• "second best ever quarterly profits"; "record $47.2 million in revenues"; "record-breaking quarter at $19.7 million" operating income; "all the vessels in our fully owned fleet are debt-free" and "repaid all its debt" after substantial deleveraging, while management highlights strong period coverage and secured future revenue.

Contradiction Point 1

Debt Reduction and Financial Stability

It involves the company's financial health and strategic priorities, which are crucial for investor confidence and future planning.

Can you clarify if the discussion is about Q2 2025 results and market outlook? - Michael Jolliffe(StealthGas Inc.)

2025Q2: The strategic objective of deleveraging has been achieved by repaying $86 million in debt and becoming debt-free. - Michael Jolliffe(CEO)

Can you provide details on the company's record profits and future strategic priorities? - Michael Jolliffe(StealthGas Inc.)

2024Q4: The company has paid off a significant portion of its debt, bringing it below $100 million during the third quarter, and it is close to just $50 million currently. - Michael Jolliffe(CEO)

Contradiction Point 2

Fleet Management and Charter Strategy

It relates to the company's operations and strategic direction, impacting maritime logistics and revenue generation.

Is the company discussing Q2 2025 results and market outlook? - Michael Jolliffe(StealthGas Inc.)

2025Q2: Three new charters were concluded, two for one year and one for three months. - Michael Jolliffe(CEO)

Can you update on the company's fleet and employment status? - Michael Jolliffe(StealthGas Inc.)

2024Q4: The company's chartering strategy aims to extend the duration of charters when possible. - Michael Jolliffe(CEO)

Contradiction Point 3

LPG Market Demand and Growth

It impacts the company's financial performance and market positioning by affecting its ability to maintain stable revenue growth.

What is management's outlook for the LPG and shipping markets? - Harry N. Vafias (President, CEO, CFO & Non-Independent Director)

2025Q2: LPG exports continue to grow with strong demand from the U.S. and Middle East. - Harry N. Vafias(President, CEO, CFO & Non-Independent Director)

Can you provide an update on the company's fleet and employment status? - Michael Jolliffe(StealthGas Inc.)

2024Q4: Global LPG exports are on a steady upward path, with major exporters like the U.S. showing significant growth. - Harry N. Vafias(President, CEO, CFO & Non-Independent Director)

Contradiction Point 4

Financial Performance and Strategic Focus

It involves the company's financial performance and strategic focus, which are crucial for understanding the company's progress and future direction.

Not explicitly stated? - Not explicitly stated

2025Q2: The strategic objective of deleveraging has been achieved by repaying $86 million in debt and becoming debt-free. - Michael Jolliffe(Chairman)

Not explicitly stated? - Not explicitly stated

2024Q3: The strategy focuses on deleveraging and optimizing cash generation, with $108 million in debt repayments and debt below $100 million. - Michael Jolliffe(Chairman)

Contradiction Point 5

LPG Market and Shipping Market Outlook

It involves the company's outlook on the LPG and shipping markets, which are critical for understanding the company's potential growth and market positioning.

What caused the unexpected decline in Q3 revenue? - Not explicitly stated

2025Q2: LPG exports continue to grow with strong demand from the U.S. and Middle East. Trade disputes affected ethane exports in Q2, but are improving. - Harry N. Vafias(President, CEO, CFO & Non-Independent Director)

What was the primary factor driving the revenue increase in Q2 compared to the same period last year? - Not explicitly stated

2024Q3: Global LPG exports are on a steady upward path, with U.S. exports up 12% year-on-year. - Harry N. Vafias(CEO)