Good day, and thank you for standing by. Welcome to the StealthGas Q2 2023 Results Conference Call. At this time all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Mr. Michael Jolliffe, Chairman of the Board. Please go ahead.

Good morning, everyone, and welcome to our second quarter 2023 earnings conference call and webcast. I’m Michael Jolliffe, Chairman of the Board of Directors and joining me on our call today is Harry Vafias, our CEO, to discuss market and company outlook and Konstantinos Sistovaris, handling Investor Relations to discuss the financial aspects. Before we commence our presentation, I would like to remind you that we will be discussing forward-looking statements, which reflect current views with respect to future events and financial performance. At this stage, if you could all take a moment to read our disclaimer on slide 2 of this presentation. Risks are further disclosed in StealthGas filings with the Securities and Exchange Commission. I would also like to point out that all amounts quoted, unless otherwise clarified, are implicitly stated in U.S. dollars. Today, we released our earnings results for the second quarter 2023. While we didn’t break last quarter’s record profits, we maintained a strong profitability of $10.5 million, resulting in our best performance on record for the first half of any year. So, let’s proceed to discuss these results and update you on the Company’s strategy and the market in general. Please turn to slide 3, where we summarize some highlights. In terms of our sale and purchase activity, we continue to look for opportunities to sell some vessels now that asset prices are rising. We first concluded the previously announced sale of 4 vessels and the last 2 were delivered in July and then entered into a new agreement for the sale of 2 more of the smaller LPGs, the Eco Dream and Eco Green to a third party with delivery in early 2024 for circa $35 million on block. In terms of chartering, we were less active and concluded 2 six-month period charters…

Thank you, Michael, and good morning to everyone. I will discuss our financial performance for the second quarter of 2023. Let us turn to slide number 7, where we see the income statement for the second quarter and 6 months of 2023 against the same periods of 2022. Even though calendar rates were -- calendar days were reduced by 12%, net revenues came in at $33.1 million for the quarter and $67.2 million for the six months, a small increase of 1% compared to last year for the six-month period. That was mostly due to a reduction in voyage expenses, but also due to the firmer rates. Operating expenses were $13.4 million for the quarter and $27.9 million for the six months. Overall, there has been a significant increase in operating expenses as a result of inflationary pressures that was actually more pronounced during the first quarter, less so in the second quarter that the Company is actually trying to control. In terms of drydocking costs, an item that had major differences in the comparison, but also depends on the timing of the drydockings. We had $1.5 million in the second quarter and $2.6 million in the six months, an increase of $2 million or 3.5 times in the six months. That was because we drydocked 3 out of the 4 Handysize vessels in the fleet, and they are the larger vessels and hence, incur higher expenses when drydock every five years. During the second quarter, the Company also recognized a noncash gain on the sale of two vessels that were delivered of $2.9 million and a noncash impairment of $2.8 million on the agreed sale of two vessels that will be delivered in January 2024. Interest and finance costs were slightly reduced over the quarterly period and flat over…

On slide 10, our brief insight on the LPG market. So far, the first half of the year has been very positive as far LPG supply is concerned, with global exports estimated to have risen by 3.5% as per Banchero Costa reports. The U.S. being a main exporter has been exporting record amounts with 12% increases year-on-year, consistently exporting above 1.5 million tons a month. With current inventories being at high levels, it’s likely this trend will continue. With the main destination of U.S. export being China and Japan, this has provided firm support for the larger LPG rates and subsequently the medium sized ships as well. The Middle East countries have also been exporting increased amount of LPG, particularly in the second quarter. Although the recent OPEC cut in oil production may moderate this growth, but that remains to be seen. Overall, in 2023, there has been a positive price differential with naphtha that has supported use of LPG as feedstock by crackers. This had less effect in Europe as plants were operating at lower margins in general, but a more pronounced effect in Asia. There has been a lot of talk in the news lately about China and an importer of LPG and its economic recovery post COVID, with references to declining imports and export numbers. But as far as LPG is concerned, April saw record amount being important and then in May, again an all-time high with 3.3 million tons being imported. Higher U.S. exports, lower propane prices, recovery utilization rates above 70% and capacity additions boded well for LPG demand from Chinese PDH plants. We have touched on PDH plants quite a few times before as we see it as a macro theme. China wants to control its propane production. Hence, major investments have been made…

[Operator Instructions] We will now take the first question from the line of Tate Sullivan from Maxim Group. Please go ahead.

[Technical Difficulty] purchase plan late in the second quarter where the majority of the [Technical Difficulty]

Sorry. Tate, I cannot hear you. If you can speak louder and more clearer. Sorry.

[Technical Difficulty] most of the repurchases in the quarter.

I can’t hear you, Tate.

We will go now to the next question from the line of David Kwan. [Ph] Please go ahead.

Yes. What is the current plan to destroy a stockholder value as you did with Imperial Petroleum?

Next question, please.

What is the plan…

We will now take the next question from the line of Climent Molins from Value Investor’s Edge. Please go ahead.

On the press release, you mentioned you want to continue to diversify with larger vessels. And I was wondering could you provide some more insight on this regard? Is this something you’re planning to do, let’s say, in the immediate future or once asset valuations normalize? And secondly, do you have a preference for newbuilds for modern tonnage, or what’s your stance?

Thank you for your question, Climent. Basically, with the way the market is and with the way that LPG is such a small business with very few players, basically, we don’t have a choice. If we find a good quality vessel, it doesn’t really matter if it’s second and or newbuilding, and it’s valued properly, we’re going to buy it. Unfortunately, it’s not like dry bulk where you have hundreds of ships, and you can pick and choose when you want to buy and what you want to buy. This is a really small market with very few quality ships for sale. And therefore, if we want to diversify and buy bigger ships, we have to be a bit more -- a bit more easy on our decisions.

Makes sense. Turning towards the share buybacks, it seems you started to use the authorization towards the end of the quarter. What was the reasoning behind this decision? And going forward, could you provide some commentary on how you plan to continue to allocate capital?

What was the first part of the question?

Yes. Like, what was the reasoning to start to use the authorization towards the end of the quarter?

Because you need to do legal paperwork, you need to take approvals and all this takes time.

Makes sense. And regarding the second one, so how you plan to continue to allocate excess capital? So how do you think about repurchases versus newbuild orders? How do you plan to balance it?

As we have discussed before, we are in a fortunate position that we can do both. We will buy back stock. We have another approximately $10 million to spend. And we have also to rebuild the Company because we have sold a lot of tonnage over the last two years.

Yes, makes sense. And final question from me. It’s more on the modeling side. As of quarter end, how much debt did the joint ventures have after the repayment of the loan on the Eco Ethereal?

Please send us an email on that because I don’t want to give you a wrong number. If you want to send us an email and we can check and come back to you.

Yes. Let’s do that. Okay. That’s all for me. Thank you for taking my questions.

Thank you.

Thank you. We will now take the next question from the line of Tate Sullivan, please go ahead, from Maxim Group.

Hello. Thank you. Can you hear me now, Harry?

A bit better.

Okay. Thank you. Just for the newbuild deliveries, so the joint venture newbuild is delivered in October and then your first -- so your newbuilds in the fourth quarter, the second and the first quarter of ‘24, I believe. Can you talk about the remaining commitments for those newbuilds, please?

For the JV, we don’t need to put in new money; for the two other ones that are due in -- both in Q1 ‘24, we need to spend about $20 million.

Okay. And then was part of the decision to sell the Eco Dream and Eco Green related to financing those commitments or totally separate consideration?

You said financing?

Are you using some of the proceeds from selling Eco Dream and Eco Green to buy the newbuild ships?

Not at all. Probably you are a bit confused. We have 15 unencumbered vessels. We can raise hundreds of millions of debt very easily and very cheaply, not at all. We just sold the ships because we saw a very good price for the size and age that the ships were.

Okay. And then, do you -- can you share the current number of shares outstanding or after the repurchases -- or maybe can you do that in the future?

It’s whatever it was minus 1.1 million shares that we have bought back.

Okay. Yes. Just you report the diluted shares. Okay. And then when would you look to start book contracts for the newbuilds for the ships under construction? Is that something that you do well ahead of delivery, or how does it usually work in LPG industry, please?

It all depends on the numbers. If we see good numbers in advance, we book; if we don’t, we wait. Normally, we book 30 to 60 days prior to delivery.

Great. Okay. All right. That’s -- and then you mentioned you already have $70 million of financing for the newbuilds. And did I hear you right that the -- two ships for $35 million. Is that…?

Yes.

Okay. Thank you very much.

Thank you, Tate.

There are no further questions at this time. I would like to hand back over to management for final remarks.

We’d like to thank you all for joining us today for our conference call and for your interest and trust in our company, and we look forward to having you again with us for the third quarter results in November. Thank you.

That does conclude our conference for today. Thank you for participating. You may now disconnect.