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Stabilis Solutions, Inc. (SLNG)·Q3 2025 Earnings Summary

Executive Summary

  • Revenue rose 15.3% year over year to $20.3M, with Adjusted EBITDA increasing to $2.9M and diluted EPS at $0.06; strong demand in marine, aerospace, and power generation drove the quarter .
  • Mix shift continued toward high-growth markets: 73% of revenue from aerospace, marine, and power generation vs 60% a year ago; LNG gallons sold were up 21% y/y, with adjusted EBITDA margin at 14.3% vs 14.6% last year .
  • Management advanced the Galveston LNG project, secured a 10-year marine bunkering agreement (~40% of planned offtake), is in late-stage talks for another ~20%, and targets ~75% of capacity contracted by FID in early 2026; construction is expected to begin in Q1 2026 with start-up in late 2027 .
  • Liquidity remained strong at $15.5M (cash $10.3M and ~$5.2M available credit), with cash from operations of $2.4M; CapEx was $3.9M, primarily to support Galveston engineering/design ahead of FID .
  • S&P Global Wall Street consensus estimates for Q3 2025 were unavailable for SLNG; estimate comparison is not possible at this time. Values retrieved from S&P Global.*

What Went Well and What Went Wrong

What Went Well

  • Record growth across target markets: marine revenue +31.5% y/y, aerospace +88.3%, power generation +31.4%; management highlighted “strong operational execution” and higher throughput volumes in marine, aerospace, and power generation .
  • Mix shift toward strategic sectors: 73% of revenue from aerospace, marine, and power generation vs 60% last year, supporting improved profitability and diversification; adjusted EBITDA rose to $2.9M .
  • Strategic milestones: secured a 10-year marine bunkering agreement tied to the Galveston LNG facility; progressing financing (JV structure with project-level debt/equity), engineering/design, and long-lead items ahead of early-2026 FID and Q1 2026 construction start .

Quotes:

  • “Stabilis demonstrated strong operational execution… Higher throughput volumes across our marine, aerospace, and power generation markets translated to improved profitability” — Casey Crenshaw .
  • “We expect to have approximately 75% of the total capacity sold under long-term customer contracts by the time we reach final investment decision in early 2026” — Casey Crenshaw .
  • “Capital expenditures increased… ahead of a final investment decision. Our liquidity position remains robust” — Andy Puhala .

What Went Wrong

  • Adjusted EBITDA margin compressed vs prior year (14.3% vs 14.6%), driven by roll-off of a high-margin industrial project; customer mix was less favorable .
  • Net equity income from the Chinese JV declined vs Q2, and the company recorded an obsolete equipment write-off; these items tempered operating leverage despite revenue growth .
  • Limited formal guidance and consensus estimate visibility: no numeric revenue/EPS guidance provided, and S&P Global consensus for Q3 2025 was unavailable, constraining external benchmarking. Values retrieved from S&P Global.*

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Revenue ($USD Millions)$17.6 $17.3 $20.3
Net Income ($USD Millions)$1.0 $(0.6) $1.1
Diluted EPS ($USD)$0.05 $(0.03) $0.06
Adjusted EBITDA ($USD Millions)$2.6 $1.5 $2.9
Adjusted EBITDA Margin (%)14.6% 8.6% 14.3%

Segment/End-Market Trend Breakdown (y/y growth rates):

End-MarketQ3 2024 → Q3 2025 y/y Growth
Marine+31.5%
Aerospace+88.3%
Power Generation+31.4%
Other Industrial−22.8%

Key KPIs and Balance Sheet/Liquidity:

KPIQ3 2024Q2 2025Q3 2025
LNG Gallons Sold (y/y)——+21% y/y
Revenue Mix (Aerospace/Marine/Power)60% 77% 73%
Cash from Operations ($USD Millions)$2.6 $4.5 $2.4
Cash & Equivalents ($USD Millions)—$12.2 $10.3
Credit Availability ($USD Millions)—~$3.9 ~$5.2
Liquidity (Cash + Availability, $USD Millions)—~$16.1 ~$15.5
CapEx ($USD Millions)—$0.6 $3.9
Total Debt & Lease Obligations ($USD Millions)—~$8.4 ~$9.5

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Galveston LNG FID timingEarly 2026Targeting capacity expansion; financing discussions underway (qualitative) Final investment decision expected early 2026 Maintained/Specified timeline
Galveston Construction Start2026Not specifiedBreak ground in Q1 2026 (subject to financing) Introduced
Galveston Start-UpLate 2027Not specifiedTarget on-stream late 2027 Introduced
Galveston Offtake Sold by FIDEarly 2026Not specified~75% capacity under long-term contracts targeted by FID Introduced
Pre-FID Project CapEx2025–early 2026Acceleration anticipated (qualitative) Additional $3–$5M expected pre-FID Introduced/Quantified

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 2025, Q2 2025)Current Period (Q3 2025)Trend
Marine bunkering growthActive Gulf Coast bunkering; pursuing long-term offtake to support liquefaction; Carnival client referenced 10-year marine bunkering contract secured (~40% of Galveston offtake); late-stage talks for additional ~20%; target ~75% contracted by FID Strengthening; contract wins and pipeline expansion
Aerospace demandAerospace revenues more than doubled in 1H 2025; continued growth expected Aerospace +88% y/y; added long-term aerospace client; repeatable volumes Accelerating
Distributed power/data centersEarly-stage but growing LNG bridge/backup use cases; multiple engagements Power generation +31% y/y; data center demand cited; distributed power as cost/timing solution Building momentum
Project financing structureWorking to secure contracts enabling project financing; acceleration in capital commitments anticipated JV with project-level debt/equity; retain operational control; bank mandated; cadence to FID early 2026 Clarified structure and milestones
Permitting/regulatory—Tracking permits; export license in hand; key agencies: Texas Railroad Commission and US Coast Guard; timeline intact Progressing; no delays signaled

Management Commentary

  • Strategic message: “This is a transformational moment… retain operational control… maximize value for all shareholders” — Casey Crenshaw on Galveston JV financing and long-term returns .
  • Operating execution: “Third quarter volume increased by more than 20% y/y… robust throughput from cruise activity” — Casey Crenshaw .
  • Financial discipline: “Liquidity at quarter-end was $15.5M… CapEx $3.9M, primarily related to early engineering/design for Galveston” — Andy Puhala .
  • Cost advantage: “We’ve got a cost advantage… well-developed facility and Jones Act vessel… makes the selling part easier” — Casey Crenshaw on bunkering offtake commercialization .

Q&A Highlights

  • Permitting and timeline clarity: Company has export license; tracking permits with Texas Railroad Commission and U.S. Coast Guard; management does not expect timeline impact .
  • Offtake customer mix: Second prospective customer for ~20% capacity is a cruise customer; remaining capacity could be cruise, container shipping, or traders; aiming for one to two additional counterparties .
  • Capacity expansion options: Considering adding a second train at George West and deploying capacity where most customer-centric; will prioritize contracted offtake and location-specific needs .
  • Third-party supply strategy: High utilization at company facilities; third-party LNG used to flex volumes/logistics; long-standing approach to build demand and optimize own molecules .
  • Data center power: Distributed power use cases increasing; LNG bridges supply where grid/pipe constraints exist; reshoring/manufacturing also adding grid demand .

Estimates Context

  • S&P Global consensus for Q3 2025 (EPS, revenue, EBITDA, # of estimates) was unavailable for SLNG; a direct comparison vs estimates cannot be provided at this time. Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Mix shift to strategic end-markets is durable, with aerospace, marine, and power generation now ~73% of revenue; this should support more stable volumes and better pricing over time .
  • The Galveston LNG project has de-risked demand with a 10-year bunkering contract (~40% of offtake) and another ~20% in late-stage discussions; target ~75% contracted by FID early 2026 .
  • Liquidity remains robust ($15.5M), and operating cash generation continues ($2.4M in Q3); near-term CapEx will ramp ($3–$5M pre-FID) to advance engineering/design, but project funding is expected at the project level (JV) .
  • Margin trajectory: Adjusted EBITDA margin recovered to 14.3% from 8.6% in Q2, though slightly below 14.6% last year due to mix; watch ongoing segment mix and JV equity income impacts .
  • Near-term trading catalysts: Additional Galveston offtake announcements, permitting updates (TRRC/USCG), and clarity on JV financing could drive sentiment and volume .
  • Medium-term thesis: Execution on Galveston and potential George West expansion, plus repeatable aerospace and distributed power contracts, can scale EBITDA and cash flow with improved asset utilization .
  • Estimate visibility remains limited; absence of consensus benchmarks increases reliance on company-specific milestones and contract disclosures. Values retrieved from S&P Global.*

Footnote: *Values retrieved from S&P Global.