IMPERIAL PETROLEUM INC. (NASDAQ: IMPP, the “Company”), a ship-owning company providing petroleum products, crude oil and drybulk seaborne transportation services, announced today its unaudited financial and operating results for the three months ended March 31, 2024.

OPERATIONAL AND FINANCIAL HIGHLIGHTS

  • Fleet operational utilization of 80.6% in Q1 24’, an improved performance compared to Q4 23’, mainly due to a 29.3% (65 days) decrease in commercial idle days. In Q1 23’our operational utilization was 85.0%.
  • 75.0% of fleet calendar days, equivalent to 671 days, in Q1 24’ were dedicated to spot activity.
  • Revenues of $41.2 million in Q1 24’, compared to $29.9 million in Q4 23’, equivalent to a 37.8% rise and $65.4 million of revenues in Q1 23’.
  • Net Income of $16.7 million in Q1 24’ compared to net income of $6.5 million in Q4 23’ equivalent to a 157% increase- and net income of $35.7 million in Q1 23’.
  • Cash and cash equivalents and time deposits of $67.0 million as of March 31, 2024.
  • On April 17, 2024, we agreed to sell our 2009 built aframax tanker Gstaad Grace II for $42 million. The vessel was delivered to its new owners on April 26, 2024.

First Quarter 2024 Results:

  • Revenues for the three months ended March 31, 2024 amounted to $41.2 million, a decrease of $24.2 million, or 37%, compared to revenues of $65.4 million for the three months ended March 31, 2023, primarily due to an average year on year decline in tanker market spot rates by 38%. It is noted that during the period ended March 31, 2023 tanker market rates were at peak levels mainly due to the sharp effect of the Russian Ukraine conflict on tanker rates which normalized in the following quarters.
  • Voyage expenses and vessels’ operating expenses for the three months ended March 31, 2024 were $13.5 million and $6.0 million, respectively, compared to $16.9 million and $6.9 million, respectively, for the three months ended March 31, 2023. The $3.4 million decrease in voyage expenses is mainly due to longer haul spot voyages and lower transit through the Suez canal compared to the same period of last year which led to decreased port expenses by $1.4 million (33.7%) and decreased commissions by $2.2 million due to lower revenues. The $0.9 million decrease in operating expenses is due to the slight decrease in the average number of our vessels.
  • Drydocking costs for the three months ended March 31, 2024 and 2023 were $0.6 million and $0.6 million, respectively. During the three months ended March 31, 2024 our aframax tanker commenced its drydocking which was concluded within April 2024, while during the three months ended March 31, 2023 one of our handysize drybulk carriers underwent its drydocking.
  • General and administrative costs for the three months ended March 31, 2024 and 2023 were $1.2 million and $1.0 million, respectively. This change is mainly attributed to the increase in stock-based compensation costs, partly offset by a reduction in reporting expenses due to the spin-off of C3is Inc. which was completed in June 2023.
  • Depreciation for the three months ended March 31, 2024 and 2023 was $4.0 million and $4.1 million, respectively. The change is attributable to the slight decrease in the average number of our vessels.
  • Interest and finance costs for the three months ended March 31, 2024 and 2023 were $0.002 million and $1.4 million, respectively, as there was no debt outstanding during the three months ended March 31, 2024.
  • Interest income for the three months ended March 31, 2024 and 2023 was $1.8 million and $1.3 million, respectively. The increase is mainly attributed to the $0.8 million of accrued interest income – related party for the three months ended March 31, 2024 in connection with the $38.7 million of the sale price of the Aframax tanker Afrapearl II (ex. Stealth Berana) which is receivable by July 2024.
  • As a result of the above, for the three months ended March 31, 2024, the Company reported net income of $16.7 million, compared to net income of $35.7 million for the three months ended March 31, 2023. The weighted average number of shares of common stock outstanding, basic, for the three months ended March 31, 2024 was 27.6 million compared to 15.1 million shares for the three months ended March 31, 2023. Earnings per share, basic, for the three months ended March 31, 2024, amounted to $0.56, compared to earnings per share, basic, of $2.31 for the three months ended March 31, 2023.
  • Adjusted net income was $17.5 million corresponding to an Adjusted EPS, basic, of $0.59 for the three months ended March 31, 2024 compared to an Adjusted net income of $36.0 million corresponding to an Adjusted EPS, basic, of $2.33 for the same period of last year.
  • EBITDA for the three months ended March 31, 2024 amounted to $18.9 million, while Adjusted EBITDA for the three months ended March 31, 2024 amounted to $19.8 million. Reconciliations of Adjusted Net Income, EBITDA and Adjusted EBITDA to Net Income are set forth below.
  • An average of 9.84 vessels were owned by the Company during the three months ended March 31, 2024 compared to 10.10 vessels for the same period of 2023.

Fleet Employment Table

As of May 16, 2024, the profile and deployment of our fleet is the following:

                                                         
Name    Year Built      Country Built      Vessel Size (dwt)      Vessel Type      Employment Status      Daily Charter Rate      Expiration of Charter(1)  
Tankers                                                               
Magic Wand      2008        Korea        47,000        MR product tanker        Spot                  
Clean Thrasher      2008        Korea        47,000        MR product tanker        Spot                    
Clean Sanctuary (ex. Falcon Maryam)      2009        Korea        46,000        MR product tanker        Spot                    
Clean Nirvana      2008        Korea        50,000        MR product tanker        Spot                    
Clean Justice      2011        Japan        46,000        MR product tanker        Spot                    
Aquadisiac     2008       Korea       51,000       MR product tanker       Spot                  
Suez Enchanted      2007        Korea        160,000        Suezmax tanker        Spot                    
Suez Protopia      2008        Korea        160,000        Suezmax tanker        Spot                    
Drybulk Carriers                                                               
Eco Wildfire      2013        Japan        33,000        Handysize drybulk        Time Charter        $18,200        June 2024  
Glorieuse      2012        Japan        38,000        Handysize drybulk        Time Charter        $13,000        May 2024  
Fleet Total                        678,000 dwt                                      
                                                         
(1) Earliest date charters could expire.

CEO Harry Vafias Commented

Year 2024 commenced quite favorably for Imperial Petroleum; $16.7 million of net income for the first quarter of this year, which is almost 160% higher than our profitability in the last quarter of 2023, fills us with optimism. The market continues to be governed by turbulence which directs longer haul voyages and is sustaining charter rates at firm levels. The financial health of Imperial Petroleum is undisputable with large cash pile and no bank debt; Going forward we will remain focused on the growth of our Company.

Conference Call details:

On May 16, 2024 at 09:00 am ET, the company’s management will host a conference call to discuss the results and the company’s operations and outlook.

Online Registration:

Conference call participants should pre-register using the below link to receive the dial-in numbers and a personal PIN, which are required to access the conference call.

https://register.vevent.com/register/BI52fe1de4b58b412dada1845a63e07141

Slides and audio webcast:

There will also be a live and then archived webcast of the conference call, through the IMPERIAL PETROLEUM INC. website (www.ImperialPetro.com). Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

About IMPERIAL PETROLEUM INC.

IMPERIAL PETROLEUM INC. is a ship-owning company providing petroleum products, crude oil and drybulk seaborne transportation services. The Company owns a total of ten vessels - six M.R. product tankers, two suezmax tankers and two handysize drybulk carriers - with a total capacity of 678,000 deadweight tons (dwt). IMPERIAL PETROLEUM INC.’s shares of common stock and 8.75% Series A Cumulative Redeemable Perpetual Preferred Stock are listed on the Nasdaq Capital Market and trade under the symbols “IMPP” and “IMPPP,” respectively.

Forward-Looking Statements

Matters discussed in this release may constitute forward-looking statements. Forward-looking statements reflect our current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management’s examination of historical operating trends, data contained in our records and other data available from third parties. Although IMPERIAL PETROLEUM INC. believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, IMPERIAL PETROLEUM INC. cannot assure you that it will achieve or accomplish these expectations, beliefs or projections. Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies and currencies, general market conditions, including changes in charter hire rates and vessel values, charter counterparty performance, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled drydockings, shipyard performance, changes in IMPERIAL PETROLEUM INC’s operating expenses, including bunker prices, drydocking and insurance costs, ability to obtain financing and comply with covenants in any financing arrangements, performance of counterparty to our vessel sale agreement, or actions taken by regulatory authorities, potential liability from pending or future litigation, domestic and international political conditions, the conflict in Ukraine and related sanctions, the conflict on Israel and Gaza, the potential disruption of shipping routes due to ongoing attacks by Houthis in the Red Sea and Gulf of Aden or accidents and political events or acts by terrorists.

Risks and uncertainties are further described in reports filed by IMPERIAL PETROLEUM INC. with the U.S. Securities and Exchange Commission.

Fleet List and Fleet Deployment         For information on our fleet and further information: Visit our website at www.ImperialPetro.com

Company Contact: Fenia Sakellaris IMPERIAL PETROLEUM INC. E-mail: info@ImperialPetro.com

Fleet Data: The following key indicators highlight the Company’s operating performance during the three month periods ended March 31, 2023 and March 31, 2024.

FLEET DATA Q1 2023 Q1 2024
Average number of vessels (1) 10.10 9.84
Period end number of owned vessels in fleet 12 11
Total calendar days for fleet (2) 909 895
Total voyage days for fleet (3) 903 878
Fleet utilization (4) 99.3% 98.1%
Total charter days for fleet (5) 408 207
Total spot market days for fleet (6) 495 671
Fleet operational utilization (7) 85.0% 80.6%

1) Average number of vessels is the number of owned vessels that constituted our fleet for the relevant period, as measured by the sum of the number of days each vessel was a part of our fleet during the period divided by the number of calendar days in that period. 2) Total calendar days for fleet are the total days the vessels we operated were in our possession for the relevant period including off-hire days associated with major repairs, drydockings or special or intermediate surveys. 3) Total voyage days for fleet reflect the total days the vessels we operated were in our possession for the relevant period net of off-hire days associated with major repairs, drydockings or special or intermediate surveys. 4) Fleet utilization is the percentage of time that our vessels were available for revenue generating voyage days, and is determined by dividing voyage days by fleet calendar days for the relevant period. 5) Total charter days for fleet are the number of voyage days the vessels operated on time or bareboat charters for the relevant period. 6) Total spot market charter days for fleet are the number of voyage days the vessels operated on spot market charters for the relevant period. 7) Fleet operational utilization is the percentage of time that our vessels generated revenue, and is determined by dividing voyage days excluding commercially idle days by fleet calendar days for the relevant period.

Reconciliation of Adjusted Net Income, EBITDA, adjusted EBITDA and adjusted EPS:

Adjusted net income represents net income before share based compensation. EBITDA represents net income before interest and finance costs, interest income and depreciation. Adjusted EBITDA represents net income before interest and finance costs, interest income, depreciation and share based compensation.

Adjusted EPS represents Adjusted net income divided by the weighted average number of shares. EBITDA, adjusted EBITDA, adjusted net income and adjusted EPS are not recognized measurements under U.S. GAAP. Our calculation of EBITDA, adjusted EBITDA, adjusted net income and adjusted EPS may not be comparable to that reported by other companies in the shipping or other industries. In evaluating Adjusted EBITDA, Adjusted net income and Adjusted EPS, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation.

EBITDA, adjusted EBITDA, adjusted net income and adjusted EPS are included herein because they are a basis, upon which we and our investors assess our financial performance. They allow us to present our performance from period to period on a comparable basis and provide investors with a means of better evaluating and understanding our operating performance.

(Expressed in United States Dollars, except number of shares) Three Months Period Ended March 31,
  2023 2024
Net Income – Adjusted Net Income    
Net income 35,724,102 16,654,604
Plus share based compensation 301,541 858,810
Adjusted Net Income 36,025,643 17,513,414
     
Net income - EBITDA    
Net income 35,724,102 16,654,604
Plus interest and finance costs 1,351,603 2,430
Less interest income (1,279,216) (1,785,878)
Plus depreciation 4,088,852 4,027,061
EBITDA 39,885,341 18,898,217
     
Net income - Adjusted EBITDA    
Net income 35,724,102 16,654,604
Plus share based compensation 301,541 858,810
Plus interest and finance costs 1,351,603 2,430
Less interest income (1,279,216) (1,785,878)
Plus depreciation 4,088,852 4,027,061
Adjusted EBITDA 40,186,882 19,757,027
     
EPS    
Numerator    
Net income 35,724,102 16,654,604
Less: Cumulative dividends on preferred shares (435,246) (435,246)
Less: Undistributed earnings allocated to non-vested shares (463,737) (856,950)
Net income attributable to common shareholders, basic 34,825,119 15,362,408
Denominator    
Weighted average number of shares, basic 15,054,406 27,613,661
EPS – Basic 2.31 0.56
     
Adjusted EPS    
Numerator    
Adjusted net income 36,025,643 17,513,414
Less: Cumulative dividends on preferred shares (435,246) (435,246)
Less: Undistributed earnings allocated to non-vested shares (467,700) (902,326)
Adjusted net income attributable to common shareholders, basic 35,122,697 16,175,842
Denominator    
Weighted average number of shares, basic 15,054,406 27,613,661
Adjusted EPS 2.33 0.59

Imperial Petroleum Inc. Unaudited Consolidated Statements of Income (Expressed in United States Dollars, except for number of shares)

            For The Three Months Ended March 31,
            2023   2024
           
Revenues              
  Revenues       65,421,101   41,203,281
                 
Expenses              
  Voyage expenses       16,077,827   12,963,607
  Voyage expenses - related party     810,530   514,414
  Vessels' operating expenses     6,875,876   5,951,561
  Vessels' operating expenses - related party   65,000   82,000
  Drydocking costs       621,376   625,457
  Management fees - related party       397,760   393,800
  General and administrative expenses     978,969   1,207,168
  Depreciation       4,088,852   4,027,061
Total expenses       29,916,190   25,765,068
                 
Income from operations       35,504,911   15,438,213
                 
Other (expenses)/income            
  Interest and finance costs     (1,351,603)   (2,430)
  Interest income       1,279,216   1,035,261
  Interest income - related party       -   750,617
  Dividend income from related party     -   189,583
  Foreign exchange gain/(loss)       291,578   (756,640)
Other income, net       219,191   1,216,391
                 
Net Income       35,724,102   16,654,604
                 
Earnings per share            
- Basic         2.31   0.56
- Diluted         2.31   0.50
Weighted average number of shares          
-Basic         15,054,406   27,613,661
-Diluted         15,054,406   30,951,012

Imperial Petroleum Inc. Unaudited Consolidated Balance Sheets (Expressed in United States Dollars)

          December 31,   March 31,
          2023   2024
               
Assets            
Current assets          
  Cash and cash equivalents   91,927,512   35,331,381
  Time deposits     32,099,810   31,628,000
  Receivable from related parties   37,906,821   38,786,553
  Trade and other receivables   13,498,813   16,747,942
  Other current assets     302,773   834,802
  Inventories     7,291,123   7,865,379
  Advances and prepayments   161,937   207,473
Total current assets     183,188,789   131,401,530
               
Non current assets          
  Operating lease right-of-use assets   -   132,448
  Vessels, net     180,847,252   248,873,394
  Investment in related party   12,798,500   12,796,416
Total non current assets     193,645,752   261,802,258
Total assets       376,834,541   393,203,788
               
Liabilities and Stockholders' Equity        
Current liabilities          
  Trade accounts payable   8,277,118   6,681,701
  Payable to related parties   2,324,334   5,256,860
  Accrued liabilities     3,008,500   4,203,686
  Operating lease liabilities, current portion     -   72,704
  Deferred income     919,116   49,950
Total current liabilities     14,529,068   16,264,901
               
Non current liabilities          
Operating lease liabilities, non-current portion     -   59,744
Total non current liabilities     -   59,744
Total liabilities     14,529,068   16,324,645
               
Commitments and contingencies        
               
               
Stockholders' equity          
  Capital stock   332,573   332,573
  Preferred stock, Series A   7,959   7,959
  Preferred stock, Series B   160   160
  Treasury stock   (5,885,727)   (8,390,225)
  Additional paid-in capital   270,242,635   271,101,445
  Retained earnings     97,607,873   113,827,231
Total stockholders' equity     362,305,473   376,879,143
Total liabilities and stockholders' equity 376,834,541   393,203,788

Imperial Petroleum Inc. Unaudited Consolidated Statements of Cash Flows (Expressed in United States Dollars

              For The Three Months Ended March 31,
              2023   2024
             
Cash flows from operating activities            
  Net income for the period         35,724,102   16,654,604
                   
Adjustments to reconcile net income to net cash          
provided by operating activities:            
  Depreciation         4,088,852   4,027,061
  Amortization of deferred finance charges     134,427   -
  Non-cash lease expense     16,316   17,550
  Share based compensation       301,541   858,810
  Unrealized foreign exchange loss on time deposits       -   799,150
  Dividend income from related party       -   (189,583)
                   
Changes in operating assets and liabilities:          
  (Increase)/decrease in              
  Trade and other receivables       (7,689,495)   (3,249,129)
  Other current assets         (487,804)   (532,029)
  Inventories         (2,435,614)   (574,256)
  Changes in operating lease liabilities       (16,316)   (17,550)
  Advances and prepayments       19,540   (45,536)
  Due from related parties       -   (879,732)
  Increase/(decrease) in              
  Trade accounts payable       476,307   (1,100,028)
  Due to related parties       633,383   2,839,227
  Accrued liabilities         605,944   903,784
  Deferred income         (406,022)   (869,166)
Net cash provided by operating activities     30,965,161   18,643,177
                   
Cash flows from investing activities            
  Dividend income received       -   191,667
  Acquisition and improvement of vessels     (25,923,656)   (72,257,190)
  Purchase of bank time deposits       (18,536,290)   (31,695,420)
  Maturity of bank time deposits       68,000,000   31,368,080
Net cash provided by/(used in) investing activities       23,540,054   (72,392,863)
                   
Cash flows from financing activities            
  Proceeds from equity offering       12,095,255   -
  Stock issuance costs         (120,954)   -
  Stock repurchase       -   (2,504,498)
  Dividends paid on preferred shares       (435,246)   (341,947)
  Loan repayments         (24,576,000)   -
Net cash used in financing activities   (13,036,945)   (2,846,445)
                   
Net increase/(decrease) in cash, cash equivalents and restricted cash   41,468,270   (56,596,131)
Cash, cash equivalents and restricted cash at beginning of period     57,506,919   91,927,512
Cash, cash equivalents and restricted cash at end of period     98,975,189   35,331,381
Cash breakdown          
  Cash and cash equivalents       95,519,418   35,331,381
  Restricted cash, current       2,855,771   -
  Restricted cash, non current       600,000   -
Total cash, cash equivalents and restricted cash shown in the statements of cash flows 98,975,189   35,331,381
Supplemental Cash Flow Information:            
Non cash investing activity – Vessel improvements included in liabilities 655,333
Non cash investing activity – Dividend income from related party included in Investment in related party 160,416
Non cash financing activity – Dividend on preferred series A included in payable to related parties 93,299
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