Imperial Petroleum Inc. Q1 FY2025 earnings call

• The first quarter of 2025 was eventful with geopolitical factors affecting tanker rates, starting soft but improving in March.
• Imperial Petroleum had a profitable quarter, with revenue up $5.9 million (22.5%) and net income up $7.4 million (almost 190%) from Q4 '24.
• Fleet employment: 7 out of 13 ships under time charter; 3 handysized dry bulk carriers on short TCs, 4 product tankers on time charter expiring 2025-2027.
• Geopolitical impacts: U.S. sanctions on Russian tankers tightened capacity and strengthened rates; trade tariffs caused uncertainty but U.S.-China rolled back tariffs; OPEC output increase boosted dirty tanker rates; clean product market was weak with Red Sea situation affecting previous periods.
• Fleet additions: Will add 7 dry bulk ships by Q3, increasing fleet to 19 ships with 1.2 million deadweight capacity; dry bulk carriers offer diversification and lower operational costs.

For the tanker segment, in Q1 '25, Imperial Petroleum generated revenues of $32.1 million. Seven out of 13 ships are under time charter employment, with four product tankers under time charter expiring between May '25 and August '27. The tanker market was affected by geopolitical factors like U.S. tariffs and sanctions on Russian tankers, with rates softer than the previous year but improving in March. For the dry bulk segment, Imperial Petroleum will add 7 ships by the beginning of Q3, increasing the fleet by 60% in number of ships and deadweight capacity. These dry bulk carriers are typically employed on short-time charters, have lower operational costs, and the market for kamsarmax and panamamax is soft but above breakeven.

• Expect every $2,000 increase in daily TC rates for newly added dry bulk ships to contribute $5 million to annual operating cash flow.
• Confident in diversified, quality, non-Chinese fleet; expect fast growth, recurring profits, and continued liquidity.

• Geopolitical factors like U.S. tariffs, sanctions on Russian tankers, and trade disruptions can cause market volatility.
• Clean product market is affected by factors like Red Sea situation which could reopen and negatively impact clean product tankers.
• Market softness for kamsarmax and panamamax dry bulk vessels, though still above breakeven.