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March 2006 NASDAQ: “GASS” StealthGas Inc. Informational Roadshow.

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Presentation on theme: "March 2006 NASDAQ: “GASS” StealthGas Inc. Informational Roadshow."— Presentation transcript:

1 March 2006 NASDAQ: “GASS” StealthGas Inc. Informational Roadshow

2 Page 2 StealthGas Inc. © 2006 Disclaimer Forward-Looking Statements This presentation contains forward-looking statements within the meaning of applicable federal securities laws. Such statements are based upon current expectations that involve risks and uncertainties. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. For example, words such as “may,” “will,” “should,” “estimates,” “predicts,” “potential,” “continue,” “strategy,” “believes,” “anticipates,” “plans,” “expects,” “intends” and similar expressions are intended to identify forward- looking statements. Actual results and the timing of certain events may differ significantly from the results discussed or implied in the forward-looking statements. Among the factors that might cause or contribute to such a discrepancy include, but are not limited to, the risk factors described in the Company’s Registration Statement filed with the Securities and Exchange Commission, particularly those describing variations on charter rates and their effect on the Company’s revenues, net income and profitability as well as the value of the Company’s fleet.

3 Page 3 StealthGas Inc. © 2006 About StealthGas A ship-owning company serving the liquefied petroleum gas (LPG) sector of the international shipping industry. Listed on NASDAQ (Symbol: GASS) The only pure LPG company listed in the United States Established in December 2004 - Went public in October 2005 raising $ 109 million (8 million shares are $ 14.50 per share) (14 million shares outstanding today) Current fleet of 24 LPG carriers – intend to expand to 28 vessels within 2006 Grew the fleet from 9 vessels pre-IPO (October 2004) to 24 vessels today Rank # 1 globally in owned vessels in the segment we focuses on (3,000 to 8,000 cbm – cubic meters)

4 Page 4 StealthGas Inc. © 2006 What is LPG? Natural Gas Ammonia Production Refining Propane Butane Ethane Petrochemical Feedstock Propylene Ethylene Butadiene VCM LPG competes with naphtha and gas oil as petrochemical feedstock High oil prices  higher naphtha and gas oil prices  LPG cheaper alternative Crude Oil Liquid Petroleum Gases Petrochemical Gases Liquid petroleum gas also refers to petrochemical gases and ammonia Extracted from natural gas production (60%) and crude oil refining (40%) LPG in gaseous state at atmospheric pressure and normal temperature 10% of natural gas is LPG, 3% of crude oil refined into LPG

5 Page 5 StealthGas Inc. © 2006 LPG Shipping Liquefied for seaborne transportation with pressure and/or refrigeration on terminal or on board LPG carriers Minimal land infrastructure - No Large Liquefaction or regasification plants (LNG) Environmentally-friendly, superior safety record to tankers Gas CategoriesProductsVessel Type Liquid Petroleum GasesPropane, Butane, EthaneFully-Pressurized, Fully-Refrigerated Petrochemical GasesEthylene (1), Propylene, VCM, Butadiene Fully-Pressurized, Semi-Refrigerated OtherAmmonia, NaphthaFully-Refrigerated, Semi-Refrigerated Size SegmentCargo Capacity (CBM)Primary Liquefaction System Handy< 8,000Semi Refrigerated, Fully Pressurized Small8-25,000Fully Pressurized, Fully Refrigerated Mid25-50,000Fully Refrigerated Large50-70,000Fully Refrigerated Very Large70,000+Fully Refrigerated StealthGas 24 Vessels (1)Certain semi-refrigerated carriers with gas plats are able to cool cargoes to minus 104 degrees Celsius and are referred to as ethylene carriers.

6 Page 6 StealthGas Inc. © 2006 LPG Fleet (1) Small size 20+ year old fleet and 25+ year old fleets are assumed to have the same percentages Source: Drewry’s We operate in the semi-refrigerated and fully-pressurized segments Gas Carrier Segment Name Cargo Capacity (CBM) Primary Liquefaction System Number of Vessels CBM (MM) Orderbook No. of Vessels Orderbook CBM Orderbook % of CBM 20+ Year Old 25+ Year Old Handy< 8,000 Semi Refrigerated Fully Pressurized6301,9245323912.4% 34.6%14.8% Small (1) 8-25,000Fully Pressurized1041,3431922516.7% 37.1%12.5% Small (1) 8-25,000Fully Refrigerated31479000.0% 37.1%12.5% Mid25-50,000Fully Refrigerated321,0971761656.1% 26.8%10.8% Large50-70,000Fully Refrigerated271,542000.0% 46.6%27.8% Very Large70,000+Fully Refrigerated1038,076383,11438.2% 34.1%17.1% 92714,4611294,19429.0% 35.3%16.9% Fully-refrigerated vessels do not compete in short-haul routes and cargo sizes 74% of the orderbook in very large gas carriers All orderbook for fleet replacement

7 Page 7 StealthGas Inc. © 2006 Why LPG Shipping? – Strong Fundamentals Attractive Trade Prospects LPG supply to grow on increasing NG production Increasing demand from developed and developing countries: −LPG: US, China −Petchems: EU, China, India −Ammonia: Worldwide Limited Fleet Supply Increasingly stringent chartering requirements −35% of fleet > 20 year vessels Low orderbook in the SR, FP segments −14% of current fleet on order through the beginning of 2009 Fewer yards construct LPG carriers Specialized sector, higher barriers to entry LPG Carrier Supply and Demand Million Cubic Meters Tight Market Range Source: Drewry

8 Page 8 StealthGas Inc. © 2006 Global Production, Trade and Consumption Production Source: CMAI, Drewry (1) 2003 data Asia (32%), Americas (39%) LPG Consumption (1) Seaborne Trade (525 million tons) (71 million tons) LPG accounts for 71% of seaborne gas trade

9 Page 9 StealthGas Inc. © 2006 Seaborne Trading Patterns Intra Asia Intra Europe Middle East to Asia Intra Americas Africa to Europe 75% of 71 million tons global trade are represented by these routes Middle East exports to Asia account for 31% of world trade Asia accounts for 50-60% of world imports Million tons 7% 14% 6% 31% 16% Natural Gas & Petrochemical Industry growth

10 Page 10 StealthGas Inc. © 2006 Harry Vafias – Chief Executive Officer  Harry Vafias a charismatic young entrepreneur, who started in the tanker business in 1999  Long established family history in shipping, The Vafias family in dry bulk shipping since 1973.  Between 1999 and 2004, he turned a $ 4 million investment into $ 400 million.  In 2004, he spotted the LPG sector as the next growth opportunity.  Established StealthGas, took it public and built a fleet of 24 vessels in less than 1 ½ years. StealthGas now ranks # 1 globally in owned vessels in its segment.

11 Page 11 StealthGas Inc. © 2006 Business StrategyImplementation Triple Fleet by mid-2006 9 of 10 Identified Vessels delivered, 1 expected by early March 2006 Acquired 5 of 9 Additional Vessels – Ahead of vessel acquisition schedule outlined during IPO Road Show Moderate Leverage Year-End 2005 debt to capitalization: 40% Visible Revenue Stream 83 % of voyage days fixed for Q1 2006 (page 5) 72% of voyage days fixed for FY 2006 Modern Fleet Our fleet average age is 10.8 years Industry average age is 15 years Close Customer Relations Utilization of 99.7 % in Q4 2005 Utilization of 99.9% in FY 2005 All additional vessels acquired with at least 6 months time charters attached Cost-Efficient Operations Low Net Income breakeven of $5,326 per day in Q4 2005 Pay Dividends Paid first dividend of 18.75 cents per share in January 2006, as outlined on IPO Road Show StealthGas Business Strategy – Since IPO to Present Day

12 Page 12 StealthGas Inc. © 2006 Grew fleet to 21 vessels by end of FY 2005 Fleet to number 24 vessels by early March 2006 Ahead of acquisition timetable outlined during IPO Road Show StealthGas ranks #1 in owned vessels in 3,000 to 8,000 CBM segment Fleet Development 28 24 21 IPO Established Oct. 2004

13 Page 13 StealthGas Inc. © 2006 Fleet Employment Profile

14 Page 14 StealthGas Inc. © 2006 “Blue-Chip” Customers Include oil majors, chemical companies and traders We focus on repeat business

15 Page 15 StealthGas Inc. © 2006 4th Quarter  Q4 Net Income $4.5 million, revenues of $12.8 million, EBITDA of $7.2 million  EPS $0.33 – 13.6 million shares outstanding  Cash balance of $23.2 million  Conservative leverage: net debt to capitalization of 30.6%  Fully utilized IPO proceeds to acquire 9 of 10 Identified Vessels plus 3 additional vessels  Arranged $50 million 10 year facility secured by 6 vessels: since increased to $64 million; secured by 8 vessels FY 2005 and Post 4 th Quarter Highlights  FY 2005 Net Income $12.2 million, revenues of $29.3 million, EBITDA of $18.0 million  EPS $1.54 – 7.9 million average shares outstanding  As of today, 7 out of the 23 vessels delivered to us remain debt free  Already acquired 5 of the expected 9 additional vessels, as outlined during IPO Road Show 4th Quarter 2005 Financial Highlights

16 Page 16 StealthGas Inc. © 2006 4 th Quarter Income Statement In US$ 000, except per share amountsQ 3 2005Q 4 200512 M 2005 Net Revenues$6,895$12,810$29,298 Operating Income3,7865,11113,713 Net Income3,6244,53612,209 EBITDA5,0937,18118,031 EPS0.600.331.54 Number of Shares6,000,00013,565,2177,906,849 Note: The total number of shares outstanding after the IPO is 14,000,000

17 Page 17 StealthGas Inc. © 2006 4th Quarter & 12M 2005 Operating Highlights – Fleet Data & Daily Results Fleet DataQ 3 2005Q 4 200512 M 2005 Average number of vessels in fleet9.015.19.3 Period end number of vessels in fleet9.021.0 Total calendar days for fleet8281,3873,382 Total voyage days for fleet8281,3833,378 Fleet utilization100%99.7%99.9% Total charter days for fleet8281,3343,324 Total spot market days for fleet04954 Average Daily Results (in USD)Q 3 2005Q 4 200512 M 2005 Time Charter Equivalent – TCE$8,027$8,155$8,032 Vessel Operating Expenses1,8092,2772,097 Management Fees302371341 General & Administrative Expenses137307229 Total Vessel Operating Expenses2,2482,5842,326

18 Page 18 StealthGas Inc. © 2006 Daily Breakeven Q4 2005 Daily Cashflow and Net Income Breakeven Composition Note: G&A includes Management Fees ($ per vessel per day) Q4 2005 fleet calendar days: 1,387 FY 2005 fleet calendar days 3,382 Q4 FY05 Expenses Cash Flow Net Income Cash Flow Net Income Operating$2,277 $2,097 General & Administrative678 569 Maintenance (surveys/drydocks)137 Interest742 648 Principal1,647016470 Depreciation & Amortization01,49201,302 Total5,4815,3265,0984,753

19 Page 19 StealthGas Inc. © 2006 4 th Quarter Balance Sheet and Adjustments (USD in millions) Dec 31 2005 Actual Three Vessels Dec 31, 2005 Pro-Forma Four Additional Vessels Dec 31, 2005 Pro-Forma Adjusted Cash & Equivalents23.2(18.2)5.0(8.0)(3.0) Vessels, Net229.832.2262.040.0302.0 Total Debt97.614.0111.632.0143.6 Shareholders’ Equity151.10.0151.10.0151.1 Total Capitalization248.714.0262.732.0294.7 Debt/Cap39% 42.4% 48.7% Vessels21 Identified 1 Additional 224 4 Additional Vessels28 Pro forma and adjusted balance sheet does not include Q1 2006 and Q2 2006 cashflow from operations Includes 1 Identified Vessel to be delivered in March 2006

20 Page 20 StealthGas Inc. © 2006 Acquisition Capex Estimated equity investment of $131.6 million to be funded with $109.0 million net IPO proceeds and $22.6 million cash from operations Expect to use approximately $26.2 million of Q1 and Q2 2006 cash flow and approximately $46 million of new debt to fund 1 remaining identified vessel plus 2 additional vessels already delivered and 4 additional vessel acquisitions by mid 2006 Q4 2005Q1 2006Q2 2006Total VesselsMillionsVesselsMillionsVesselsMillionsVesselsMillions Identified Vessels 9$112.11 $12.9--10$125.0 Additional Vessels 3 $43.32 $19.34$40.0 9$102.6 Acquisition Capex12$155.43 $32.24$40.0 19 $227.6 Debt Incurrence ($50.0)($14.0) ($32.0) ($96.0) Net Cash Outflow $105.4 $18.2 $8.0 $131.6 Note: Estimated numbers, actual figures may vary depending on market conditions

21 Page 21 StealthGas Inc. © 2006 Financial Estimator

22 Page 22 StealthGas Inc. © 2006 Increased LPG Supplies => Higher Freight Rates Expanding LPG supplies are driven by increased LNG production and crude oil refining LPG supplies are expected to increase by 50% from the present 50 million tons to 75 million tons by 2010 and then to 85 million tons by 2015 Increased LPG supplies have already had a beneficial impact on freight rates and we believe this trend will continue Source: CMAI, Drewrys, VLO, ESAI, Purvin Gertz, PIRA, Poten & Partners. LNG Production CAGR = 12% Trillion Cubic Feet

23 Page 23 StealthGas Inc. © 2006 Million Tons Periods of Rapid LPG Demand Growth Duration America 1950 - 1972 22 years Europe 1960 – 1980 20 years Japan 1965 – 1988 23 years Korea 1977 – 1998 24 years China 1993 - 12 years so far… LPG Macro Consumption Trends Increasing Urbanization and Rising Living Standards --> Rapid increase in consumption Japanese LPG consumption steady post-rapid development Average 22 years rapid growth, China should realize another decade China Urbanization: 20 Million/p.a., India: Further growth potential LPG Consumption - JapanHousehold LPG Usage in Asia Source: Poten & Partners.

24 Page 24 StealthGas Inc. © 2006 Strong LPGC freight rates Source: Inge Steensland AS Shipbrokers Average earnings in the spot market excluding waiting time / 1 yr TC rates

25 Page 25 StealthGas Inc. © 2006 Charter Market Rate Indicator (12 Month TCs) Q4 2005 AverageCurrentQ1 2006 Forecast 3,200 CBM S/R295,000305,000 3,500 CBM P/R250,000240,000 6,000 CBM S/R430,000450,000 15,000 CBM S/R725,000775,000 38,000 CBM970,0001,000,000 60,000 CBM985,0001,000,000 78,000 CBM1,100,000 Source: Lorentzen & Stemco

26 Page 26 StealthGas Inc. © 2006 Balanced Outlook Source: Inge Steensland AS Shipbrokers 3-8000 cbm fleet development vs TC rates/earnings

27 Page 27 StealthGas Inc. © 2006 Contacts Company Contact: Andrew J. Simmons Visit our Website at:Visit our Website at: Chief Financial Officer StealthGas Inc. 011-30-210-6250-001 E-mail: Investor Relations/Media: Nicolas Bornozis Capital Link, Inc.(New York) Tel. 212-661-7566 E-mail: Weekly LPG Market Report updated every Monday Comprehensive Investor Relations Information

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