GlobeNewswire Inc | Dec 21, 2021 09:20AM EST

December 21, 2021

ATHENS, Greece, Dec. 21, 2021 (GLOBE NEWSWIRE) -- Imperial Petroleum Inc. (Nasdaq: IMPP) (the Company), a ship-owning company providing petroleum product and crude oil seaborne transportation services, today announced its unaudited financial and operating results for the third quarter and nine months ended September 30, 2021. These financial results were prepared on acarve-outbasis from the financial statements of StealthGas Inc., which was our parent company prior to the completion of our spin-off on December 3, 2021, and, accordingly, do not reflect any adjustments for the spin-off, including the incurrence of debt and issuance of common shares and Series A preferred shares in conjunction therewith.

OPERATIONAL AND FINANCIAL HIGHLIGHTS

-- Successful spin-off of StealthGas Inc.s four tankers to our newly listed company Imperial Petroleum Inc.; this was concluded on December 3, 2021. -- Our newly listed company currently owns four standard tankers (three product tankers (MR2s) and one aframax tanker) with an average age of 12.9 years. -- Fleet operational utilization of 84.8% in Q3 '21 compared to 87% in the same period of the previous year due to a prolonged weak tanker market. -- Currently all of our vessels are on period charters, the majority of which have charterers extension options. About 67% of fleet days are secured on period employment for the first quarter of 2022. -- Revenues of $4.1 million in Q3 '21, marking a decrease of $1.7 million compared to Q3 '20 due to the sharp drop in revenues stemming from the weak spot market and one of our product tankers being idle for 39% of the quarter. -- Net loss of $0.9 million for Q3 '21. -- In Q4 '21 we incurred senior secured bank debt of $28 million. -- Declaration of an initial dividend on our 8.75% Series A Cumulative Redeemable Perpetual Preferred Stock ($0.1640625 per preferred share) payable on December 30, 2021 to holders of record on December 27, 2021.

Third Quarter 2021 Results:

-- Revenues for the three months ended September 30, 2021 amounted to $4.1 million, marking a decrease of $1.7 million, or 29.3%, compared to revenues of $5.8 million for the three months ended September 30, 2020, mainly due to a soft spot market and one of our product tankers being idle 36 days thus producing 67% (c. $1.7 million) less revenue compared to the same period of last year. -- Voyage expenses and vessels operating expenses for the three months ended September 30, 2021 were $0.7 million and $1.9 million, respectively, compared to $1.3 million and $2.0 million, respectively, for the three months ended September 30, 2020. The $0.6 million decrease in voyage expenses, is attributed to the 68% (126 days) decline in spot days. The 5.0% decrease in vessels operating expenses compared to the same period of 2020, is a result of a reduction in maintenance costs by $0.2 million counterbalanced by an increase of $0.1 million in crew expenses related to COVID-19. It is noted that during the three months ended September 30, 2020, our aframax tanker underwent drydocking thus producing increased maintenance costs - particularly spares. -- Drydocking costs for the three months ended September 30, 2021 and 2020 were nil and $0.9 million, respectively. Drydocking expenses during the third quarter of 2020 mainly related to the completion of the drydocking of our aframax tanker. -- As a result of the above, for the three months ended September 30, 2021 and 2020, the Company reported a net lossof $0.9 million and $0.7 million, respectively. -- EBITDA for the three months ended September 30, 2021 amounted to $1.2 million. -- An average of 4.0 vessels were owned by the Company during the three months ended September 30, 2021 and 2020.

Nine Months 2021 Results:

-- Revenues for the nine months ended September 30, 2021 amounted to $13.4 million, a decrease of $1.3 million, or 8.8%, compared to revenues of $14.7 million for the nine months ended September 30, 2020, mainly due to a decline in spot revenues and a rise in commercial idle days. -- Voyage expenses and vessels operating expenses for the nine months ended September 30, 2021 were $2.7 million and $5.6 million respectively, compared to $2.0 million and $5.4 million for the nine months ended September 30, 2020. The $0.7 million increase in voyage expenses was mainly due to the significant increase in our daily bunker costs. The $0.2 million increase in vessels operating expenses was mainly due the reduction of bareboat days by 22.9% or 81 calendar days for which we incurred operating costs during the 2021 period. -- Drydocking costs for the nine months ended September 30, 2021 and 2020 were nil and $0.9 million respectively. The costs for the nine months ended September 30, 2021 mainly related to the completion of the drydocking of our aframax tanker. -- As a result of the above, the Company reported a net loss for the nine months ended September 30, 2021 and 2020 of $2.2 million and $0.6 million respectively. -- EBITDA for the nine months ended September 30, 2021 amounted to $4.4 million. -- An average of 4.0 vessels were owned by the Company during the nine months ended September 30, 2021 and 2020. -- As of September 30, 2021, cash and cash equivalents amounted to $1.4 million. -- As of the date hereof, we have 4,775,272 Common Shares and 795,878 Series A Preferred Shares outstanding.

CEOHarry Vafias Commented

"We are happy to have successfully concluded the spin-off of STEALTHGASs four tankers into a separate listed entity. This year has been tough for tanker owners as the market was hit by COVID-19 uncertainty resulting in reduced oil demand and reduced crude exports. Focusing on our third quarter performance based on the carve-out financials produced, this was quite poor; we ended the quarter with a net loss of $1 million due to the weak freight market which led to one of our product tankers being idle for 39% of the quarter, along with the fact that another vessel of the fleet had to be quarantined due to a COVID-19 incident and could not perform its period employment for 20 days."It remains to be seen when COVID-19, which is the main factor that clouds all economic activity, will lessen its impact on energy demand. From a strategic standpoint, we have the patience to wait and at the same time run our Company conservatively having as cornerstones solid earnings visibility and a healthy capital structure."

Conference Call details:

On December 21, 2021 at 11:00 am ET, the companys management will host a conference call to discuss the results and the companys operations and outlook.

Participants should dial into the call 10 minutes before the scheduled time using the following numbers: +1 866 280 1157 (US Toll Free Dial In) or 08006941461 (UK Toll Free Dial In).Access Code: 9869442

In case of any problems with the above numbers, please dial +1 6467871226 (US Toll Dial In), +44 (0) 203 0095709 (Standard International Dial In).Access Code: 9869442

A telephonic replay of the conference call will be available until December 28, 2021 by dialing +1 (917) 677-7532 (US Local Dial In), +44 (0) 8445718951 (UK Local Dial In).

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 product and crude oil seaborne transportation services. The Company owns three M.R. product tankers and one Aframax oil tanker with a total capacity of 255,804 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 StatementsMatters 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, or impact or duration of the COVID-19 pandemic 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, managements 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 risks discussed in our filings with the SEC and the following: the impact of the COVID-19 pandemic and efforts throughout the world to contain its spread, 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 INCs operating expenses, including bunker prices, drydocking and insurance costs, ability to obtain financing and comply with covenants in our financing arrangements, or actions taken by regulatory authorities, potential liability from pending or future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists.

Company Contact:

Fenia SakellarisIMPERIAL PETROLEUM INC.00-30-210-6250-001E-mail:fs@Imperialpetro.com

Fleet Data: The following key indicators highlight the Companys operating performance during the periods ended September 30, 2020 and September 30, 2021.

FLEET DATA Q3 2020 Q3 2021 9M 2020 9M 2021Average number of vessels (1) 4.0 4.0 4.0 4.0Period end number of owned vessels in fleet 4 4 4 4Total calendar days for fleet (2) 368 368 1,096 1,092Total voyage days for fleet (3) 325 348 1,049 1,060Fleet utilization (4) 88.3% 94.6% 95.7% 97.1%Total charter days for fleet (5) 141 290 779 821Total spot market days for fleet (6) 184 58 270 239Fleet operational utilization (7) 87.0% 84.8% 95.3% 89.7%

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 EBITDA:

EBITDA represents net income before other finance costs, interest income and depreciation. EBITDA is not a recognized measurement under U.S. GAAP. Our calculation of EBITDA may not be comparable to that reported by other companies in the shipping or other industries.

EBITDA is included herein because it is a basis, upon which we and our investors assess our financial performance. It allows us to present our performance from period to period on a comparable basis and provides investors with a means of better evaluating and understanding our operating performance.

(Expressed in UnitedStates Dollars, Third Quarter Ended Nine Months Period Ended except number of September 30^th, September 30^th,shares) 2020 2021 2020 2021 Net income (681,671 ) (928,306 ) (553,707 ) (2,157,030 )Plus other finance 1,493 3,732 10,125 7,108 costsLess interest income -- (3 ) (105 ) (7 )Plus depreciation 2,168,666 2,168,666 6,475,254 6,505,997 EBITDA 1,488,488 1,244,089 5,931,567 4,356,068

Imperial Petroleum Inc. Unaudited Condensed Combined Carve-out Statements of Operations(Expressed in United States Dollars) Quarters Ended For The Nine Months September 30, Ended September 30, 2020 2021 2020 2021 Revenues Revenues 5,769,915 4,129,178 14,729,880 13,356,055 Total revenues 5,769,915 4,129,178 14,729,880 13,356,055 Expenses Voyage expenses 1,184,792 681,730 1,832,189 2,496,846 Voyage expenses - 72,124 49,887 183,649 166,552 related party Vessels' operating 1,945,645 1,874,880 5,323,206 5,570,003 expenses Vessels' operating expenses - related 15,000 24,000 33,500 66,000 party Dry-docking costs 860,134 -- 880,909 -- Management fees - 132,940 132,940 370,415 394,485 related party General and administrative 54,596 115,639 157,775 291,801 expenses Depreciation 2,168,666 2,168,666 6,475,254 6,505,997 Total expenses 6,433,897 5,047,742 15,256,897 15,491,684 Loss from operations (663,982 ) (918,564 ) (527,017 ) (2,135,629 ) Other (expenses)/income Other finance costs (1,493 ) (3,732 ) (10,125 ) (7,108 ) Interest income -- 3 105 7 Foreign exchange loss (16,196 ) (6,013 ) (16,670 ) (14,300 )Other expenses, net (17,689 ) (9,742 ) (26,690 ) (21,401 ) Net loss (681,671 ) (928,306 ) (553,707 ) (2,157,030 )

Imperial Petroleum Inc.Unaudited Condensed Combined Carve-out Balance Sheets(Expressed in United States Dollars) December 31, September 30, 2020 2021 Assets Current assets Cash and cash equivalents 6,451,524 1,436,436 Restricted cash 1,165,031 -- Trade and other receivables 665,875 860,472 Other current assets 173,930 -- Inventories 835,997 1,250,518 Advances and prepayments 139,601 110,903Total current assets 9,431,958 3,658,329 Non current assets Vessels, net 128,689,447 122,131,650Total non current assets 128,689,447 122,131,650Total assets 138,121,405 125,789,979 Liabilities and Stockholders' Equity Current liabilities Payable to related party 1,473,000 -- Trade accounts payable 1,192,965 2,264,996 Accrued liabilities 390,923 217,102 Customer deposits 868,000 368,000 Deferred income 134,594 143,813Total current liabilities 4,059,482 2,993,911Total liabilities 4,059,482 2,993,911 Commitments and contingencies Net parent investment 134,061,923 122,796,068Total liabilities and net parent investment 138,121,405 125,789,979

Imperial Petroleum Inc. Unaudited Condensed Combined Carve-out Statements of Cash Flows (Expressed in United States Dollars) For The Nine Months Ended September 30, 2020 2021 Cash flows from operating activities Net loss for the period (553,707 ) (2,157,030 ) Adjustments to reconcile net loss to net cashprovided by operating activities: Depreciation 6,475,254 6,505,997 Changes in operating assets and liabilities: (Increase)/decrease in Trade and other receivables (603,234 ) (194,597 ) Other current assets (211,155 ) 173,930 Inventories (892,291 ) (414,521 ) Advances and prepayments (56,685 ) 28,698 Increase/(decrease) in Balances with related parties 1,473,000 (1,473,000 ) Trade accounts payable 1,715,310 1,123,831 Accrued liabilities 111,089 (31,221 ) Deferred income (223,798 ) 9,219 Net cash provided by operating activities 7,233,783 3,571,306 Cash flows from investing activities Vessel improvements (728,000 ) (142,600 )Net cash used in investing activities (728,000 ) (142,600 ) Cash flows from financing activities Net transfers to parent (7,213,974 ) (9,108,825 ) Customer deposits paid (100,000 ) (500,000 )Net cash used in financing activities (7,313,974 ) (9,608,825 ) Net decrease in cash, cash equivalents and (808,191 ) (6,180,119 )restricted cashCash, cash equivalents and restricted cash 8,802,847 7,616,555 at beginning of yearCash, cash equivalents and restricted cash 7,994,656 1,436,436 at end of periodCash breakdown Cash and cash equivalents 6,829,625 1,436,436 Restricted cash, current 1,165,031 -- Total cash, cash equivalents and restricted 7,994,656 1,436,436 cash shown in the statements of cash flows