Release Date: February 13, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Imperial Petroleum Inc (NASDAQ:IMPP) achieved a strong operational utilization of 86% in Q4 '24, despite challenging market conditions.
• The company reported a significant increase in time charter coverage, with a 180% rise compared to Q4 '23.
• Imperial Petroleum Inc (NASDAQ:IMPP) ended the year with a substantial profit of about $50 million and an annual operating cash flow close to $78 million.
• The company maintains a debt-free capital structure, facilitating robust cash flow generation and low breakeven.
• Imperial Petroleum Inc (NASDAQ:IMPP) has a strong cash base of close to $207 million, with a 67% increase in available cash within '24.

Negative Points

• Q4 '24 revenues declined by $3.5 million compared to the same period in '23, due to lower market rates.
• The company incurred a $3.3 million foreign exchange loss in Q4 '24, impacting net income.
• Market conditions in '24 were softer than anticipated, with a decline in tanker rates from multiyear highs.
• The depreciation of the yuan could affect crude import volumes in the short term, impacting demand.
• Geopolitical tensions and trade tariffs could have a material impact on global energy trade and tanker markets.

Q & A Highlights

• Warning! GuruFocus has detected 3 Warning Signs with IMPP.

Q: Can you elaborate on the impact of geopolitical tensions and market conditions on your Q4 '24 performance? A: Harry Vafias, CEO, explained that geopolitical tensions, a mild winter, and OPEC's delays in unwinding production cuts led to a softer tanker market in Q4 '24. Despite these challenges, Imperial Petroleum achieved strong operational utilization of 86% due to increased time charter coverage.

Q: How did the company's financial performance in Q4 '24 compare to the previous year? A: Ifigeneia Sakellari, Interim CFO, noted that Q4 '24 revenues were $26.2 million, a $3.5 million decline from Q4 '23 due to lower market rates. However, operational utilization and time charter coverage helped offset the impact, resulting in an operating income of close to $5 million and a net income of $3.9 million.

Q: What are the expectations for oil demand and supply in 2025? A: Harry Vafias, CEO, stated that oil demand is expected to grow steadily, driven by emerging economies and China's anticipated recovery. Non-OPEC countries, particularly the US, Brazil, Canada, and Norway, are expected to drive oil supply growth.

Q: How is the company positioned in terms of fleet growth and financial health? A: Ifigeneia Sakellari, Interim CFO, highlighted that Imperial Petroleum has a debt-free balance sheet and a strong cash base of $207 million. The company plans to continue its fleet expansion strategy, with upcoming vessel deliveries in Q2 '25.

Q: What are the key strategic focuses for Imperial Petroleum moving forward? A: Harry Vafias, CEO, emphasized the company's focus on materializing fleet growth plans, sustaining profitable momentum, and seeking opportunities to enhance company value. The company aims to maintain its strong performance and capitalize on market opportunities.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.