-- Net income of $15.7 million or $0.52 per share basic and $0.51 per
share diluted calculated on 30,428,810 basic and 30,554,537 diluted
weighted number of shares outstanding, respectively, on total net revenues
of $34.5 million. Excluding the effect on the earnings for the quarter from
the amortization of the fair value of time charter contracts acquired the
earnings per share for the quarter ended June 30, 2008 would have been
$0.44 per share basic and diluted.
-- Adjusted EBITDA was $21.7 million. Please refer to a subsequent
section of the Press Release for a reconciliation of adjusted EBITDA to net
income.
-- An average 15.44 vessels were operated during the second quarter 2008
earning an average time charter equivalent rate of $25,918 per day.
-- Declared a quarterly dividend of $0.32 per share for the second
quarter 2008 payable on September 17, 2008 to shareholders of record on
September 5, 2008.
Six Months 2008 Highlights:
-- Net income of $30.9 million or $1.02 per share basic and $1.01 per
share diluted calculated on 30,375,182 basic and 30,501,654 diluted
weighted number of shares outstanding, respectively, on total net revenues
of $67.3 million. Excluding the effect on the earnings for the quarter from
the amortization of the fair value of time charter contracts acquired the
earnings per share for the six months ended June 30, 2008 would have been
$0.87 per share basic and $0.86 per share diluted, respectively.
-- Adjusted EBITDA was $42.7 million. Please refer to a subsequent
section of the Press Release for a reconciliation of adjusted EBITDA to net
income.
-- An average 15.22 vessels were operated during the first six months of
2008 earning an average time charter equivalent rate of $25,824 per day
-- Declared quarterly dividends for the first and second quarters of
2008, aggregating $0.63 per share.
Fleet Developments:
-- In May 2008, took delivery of the M/V Maersk Noumea, an intermediate
container vessel acquired for $43.5 million in May 2008. The vessel has a
capacity of 34,677 dwt and 2,556 teu built in 2001, in South Korea. The
vessel is employed under a term charter until August 2011, at a rate of
about $16,800 per day followed by three one-year optional extensions for
the charterer.
-- Following the acquisition of M/V Maersk Noumea, approximately 80% of
Euroseas total fleet days in the remaining of 2008 and approximately 34% in
2009 are fixed under period charters, already concluded spot charters, or,
otherwise protected from market fluctuations.
Aristides Pittas, Chairman and CEO of Euroseas commented: "During the
second quarter of 2008, we continued to solidify our operations and at the
same time expanded our fleet by one vessel, acquiring our youngest
containership. We plan to continue expanding our fleet when opportunities
arise by selecting vessels from the whole spectrum of the drybulk and
containership markets which we believe maximize our return on equity at any
given point of the market cycles. The growth of our dividend from $0.49
per share for the first six months of 2007 to $0.63 per share for the first
six months of 2008, a 29% increase, is the best evidence of the
effectiveness of our investment and employment strategy, especially since
it represents only about 60% of our net income and less than 50% of our
cash flow. Our aim is to continue providing consistent and significant
dividends throughout the market cycles."
Tasos Aslidis, Chief Financial Officer of Euroseas commented: "The results
of the first six months of 2008 reflect significantly higher revenues
compared to the first six months 2007 due to the higher average time
charter equivalent rate our vessels have achieved and the higher number of
vessels in our fleet. Specifically during the first six months of 2008,
our fleet earned on average $25,824 per vessel per day compared to $18,567
per vessel per day during the same period in 2007. Daily vessel operating
expenses, including management fees, during the first six months of 2008
reflect an increase of about 29% on a per vessel per day basis compared to
the same period in 2007. This increase is mainly due to the increase in
euro/dollar exchange rate, cost of lubricants, higher maintenance costs and
higher crew costs because of the increased competition in securing quality
personnel.
"As of today, about 80% of our ship capacity days in the remaining of 2008
have been fixed (including the spot voyages already concluded for which the
revenue is already known). In 2009, 34% of our capacity is under time
charter contracts or protected from market fluctuations. We believe that
our contract coverage gives us a solid revenue base for 2008 and 2009, more
predictable cash flows and sufficient downside protection, while still
allowing us to participate in the potential upside of the market."
Second Quarter 2008 Results:
For the second quarter of 2008, the Company reported total net revenues of
$34.5 million and net income of $15.7 million representing a 121.5% and
145.3% increase, respectively, over total net revenues of $15.6 million and
net income of $6.4 million during the second quarter of 2007 On average,
15.44 vessels were operated during the second quarter 2008 earning an
average time charter equivalent rate of $25,918 per day compared to 10.08
vessels in the same period 2007 earning on average $18,776 per day.
Adjusted EBITDA for the second quarter of 2008 was $21.7 million, a 91.4%
increase over $11.4 million achieved during the second quarter of 2007.
Please see below for Adjusted EBITDA reconciliation to net income and cash
flow provided by operating activities.
Basic earnings per share for the second quarter of 2008 were $0.52,
calculated on 30,428,810 weighted average number of shares outstanding,
compared to earnings per share of $0.35 for the second quarter of 2007,
calculated on 18,370,861 weighted average number of shares outstanding.
Diluted earnings per share were $0.51 and $0.35, respectively, inclusive of
capital gains of $0.20 for the second quarter of 2007. The Company has
recently declared a quarterly dividend of $0.32 per share, which represents
its twelfth consecutive quarterly dividend and a 28% increase over last
year's second quarter dividend.
Excluding the effect on the earnings for the quarter from the amortization
of the fair value of time charter contracts acquired the earnings per share
for the quarter ended June 30, 2008 would have been $0.44 per share basic
and diluted and, for the quarter ended June 30, 2007 would have been $0.38
per share basic and diluted. Usually, security analysts do not include
amortization of the fair value of period charter contracts in their
published estimates of earnings per share.
Six Months Ended June 30, 2008 Results:
For the six months ended June 30, 2008, the company reported total net
revenues of $67.3 million and net income of $30.9 million, representing a
131.2% and 94.5% increase, respectively over the same period of 2007.
Adjusted EBITDA for the period was $42.7 million, a 71.1% increase over
2007 (please see below for Adjusted EBITDA reconciliation to net income and
cash flow from operating activities). In the first six months ended June
30, 2007, net revenues were $29.1 million, net income was $15.9 million and
EBITDA was $24.9 million. On average, 15.22 vessels were operated during
the six month period 2008 earning an average time charter equivalent rate
of $25,824 per day compared to 9.55 vessels in the same period 2007 earning
a time charter equivalent rate of $18,567. Results for the six month period
ended June 30, 2007 included a capital gain of $3.4 million from the sale
of M/V "Ariel." Excluding the capital gains from the 2007 results, net
income and Adjusted EBITDA for the six month period ended June 30, 2008
increased 147.7% and 98.2%, respectively, over the same period of 2007.
Basic earnings per share for the six months ended June 30, 2008, were
$1.02, calculated on 30,375,182 weighted average number of shares
outstanding, compared to earnings per share of $0.92 for the same period of
2007 calculated on 17,258,629 weighted average number of shares
outstanding. Diluted earnings per share were $1.01 and $0.92 per share
calculated on 30,501,654 and 17,258,629 weighted average number of shares
outstanding for the first six months of 2008and 2007, respectively.
Excluding the effect on the earnings for the quarter from the amortization
of the fair value of time charter contracts acquired the earnings per share
for the six month period ended June 30, 2008 would have been $0.87 per
share basic and $0.86 per shares diluted, and, for the six month period
ended June 30, 2007 would have been $0.79 per share basic and diluted
exclusive of a $0.20 per share capital gain from the sale of M/V Ariel in
February 2007. Usually, security analysts do not include amortization of
the fair value of period charter contracts or contribution from capital
gains in their published estimates of earnings per share.
Fleet Profile:
The Euroseas Ltd. fleet profile is as follows:
Year TCE Rate
Name Type Dwt TEU Built Employment ($/day)
------------- -------- ------ ----- ----------- -----------
Dry Bulk Vessels
------------- -------- ------ ----- ----------- -----------
Baumarine
Pool - 'til Spot/Partly
IRINI (*) Panamax 69,734 1988 end 2008 fixed
------------- -------- ------ ----- ----------- -----------
ARISTIDES N.P. TC 'til
Panamax 69,268 1993 Jan-09 $ 52,000
------------- -------- ------ ----- ----------- -----------
IOANNA P. Panamax 64,873 1984 Spot $ Spot
------------- -------- ------ ----- ----------- -----------
TC 'til
NIKOLAOS P. Handysize 34,750 1984 Sep-08 $ 36,000
------------- -------- ------ ----- ----------- -----------
GREGOS Handysize 38,691 1984 Spot $ Spot
------------- -------- ------ ----- ----------- -----------
Total Dry Bulk
Vessels 5 277,316
------------- -------- ------ ----- ----------- -----------
------------- -------- ------ ----- ----------- -----------
Multipurpose Dry
Cargo Vessels
------------- -------- ------ ----- ----------- -----------
$8,850 'til
Dec-08,
TASMAN TRADER 1 22,568 950 1990 TC 'til $9,500 'til
Mar-12 Dec-10,
$9,000 'til
Mar-12
------------- -------- ------ ----- ----------- -----------
Container Carriers
------------- -------- ------ ----- ----------- -----------
$16,800'til
Aug 11
$18,735'til
TC 'til Aug 12
MAERSK NOUMEA Intermediate 34,677 2,556 2001 Aug-11 $19,240'til
(3 annual Aug 13
options $19,750'til
'til Aug-14) Aug 14
------------- -------- ------ ----- ----------- -----------
TC 'til
TIGER BRIDGE Intermediate 31,627 2,228 1990 Jul-09 $ 16,500
------------- -------- ------ ----- ----------- -----------
TC 'til
ARTEMIS Intermediate 29,693 2,098 1987 Dec-08 $ 19,000
------------- -------- ------ ----- ----------- -----------
TC 'til
DESPINA P Handy size 33,667 1,932 1990 Feb-09 $ 15,250
------------- -------- ------ ----- ----------- -----------
OEL INTEGRITY TC 'til
(ex-JONATHAN P) Handy size 33,667 1,932 1990 May-09 $ 16,500
------------- -------- ------ ----- ----------- -----------
OEL TRANSWORLD
(ex-CLAN TC 'til
GLADIATOR) Handy size 30,007 1,742 1992 Sep/Nov 09 $ 18,500
------------- -------- ------ ----- ----------- -----------
TC 'til
YM XINGANG I Handy size 23,596 1,599 1993 Jul-09 $ 26,650
------------- -------- ------ ----- ----------- -----------
TC 'til
MANOLIS P Handy size 20,346 1,452 1995 Nov-09 $ 15,800
------------- -------- ------ ----- ----------- -----------
$12,800'til
NINOS (ex-YM Apr-08
QINGDAO I) TC 'til $13,175'til
Feeder 18,253 1,169 1990 Apr-09 Apr-09
------------- -------- ------ ----- ----------- -----------
TC 'til
KUO HSIUNG Feeder 18,154 1,169 1993 Feb-09 $ 15,800
------------- -------- ------ ----- ----------- -----------
Total Container
Carriers 10 273,687 17,877
------------- -------- ------ ----- ----------- -----------
Fleet Grand
Total 16 573,571 18,827
------------- -------- ------ ----- ----------- -----------
(*) "IRINI" is employed in the Baumarine spot pool that is managed by
Klaveness, a major global charterer in the dry bulk area, and also
participates in "short" funds (contracts to carry cargo at agreed rates),
reducing its exposure to the spot market.
Summary Fleet Data:
3 months, 3 months, 6 months, 6 months,
ended ended ended ended
June June June June
30, 2007 30, 2008 30, 2007 30, 2008
------- ------- ------- -------
FLEET DATA
Average number of vessels (1) 10.08 15.44 9.55 15.22
Calendar days for fleet (2) 917.0 1,405.0 1,728.0 2,770.0
Available days for fleet (3) 862.0 1,369.3 1,629.0 2,671.2
Voyage days for fleet (4) 860.6 1,353.5 1,626.3 2,646.2
Fleet utilization (5) 99.8% 98.8% 99.8% 99.1%
AVERAGE DAILY RESULTS
Time charter equivalent rate (6) 18,776 25,918 18,567 25,824
Vessel operating expenses (7) 4,587 6,050 4,515 5,820
General and administrative expenses (8) 474 894 396 829
Total vessel operating expenses (9) 5,061 6,944 4,911 6,649
------- ------- ------- -------
(1) Average number of vessels is the number of vessels that constituted our
fleet for the relevant period, as measured by the sum of the number of
calendar days each vessel was a part of our fleet during the period divided
by the number of calendar days in that period.
(2) Calendar days. We define calendar days as the total number of days in a
period during which each vessel in our fleet was in our possession
including off-hire days associated with major repairs, drydockings or
special or intermediate surveys. Calendar days are an indicator of the size
of our fleet over a period and affect both the amount of revenues and the
amount of expenses that we record during that period.
(3) Available days. We define available days as the total number of days in
a period during which each vessel in our fleet was in our possession net of
off-hire days associated with scheduled repairs, drydockings or special or
intermediate surveys. The shipping industry uses available days to measure
the number of days in a period during which vessels were available to
generate revenues.
(4) Voyage days. We define voyage days as the total number of days in a
period during which each vessel in our fleet was in our possession net of
off-hire days associated with scheduled and unscheduled repairs,
drydockings or special or intermediate surveys or days waiting to find
employment or other offhire. The shipping industry uses voyage days to
measure the number of days in a period during which vessels actually
generate revenues.
(5) Fleet utilization. We calculate fleet utilization by dividing the
number of our voyage days during a period by the number of our available
days during that period. The shipping industry uses fleet utilization to
measure a company's efficiency in finding suitable employment for its
vessels and minimizing the amount of days that its vessels are off-hire for
reasons such as unscheduled repairs or days waiting to find employment.
(6) Time charter equivalent, or TCE, is a measure of the average daily
revenue performance of a vessel on a per voyage basis. Our method of
calculating TCE is consistent with industry standards and is determined by
dividing revenue generated from voyage charters net of voyage expenses by
available days for the relevant time period. Voyage expenses primarily
consist of port, canal and fuel costs that are unique to a particular
voyage, which would otherwise be paid by the charterer under a time charter
contract, as well as commissions. TCE is a standard shipping industry
performance measure used primarily to compare period-to-period changes in a
shipping company's performance despite changes in the mix of charter types
(i.e., spot voyage charters, time charters and bareboat charters) under
which the vessels may be employed between the periods.
(7) Daily vessel operating expenses, which includes crew costs, provisions,
deck and engine stores, lubricating oil, insurance, maintenance, repairs
and management fees are calculated by dividing vessel operating expenses
plus management fees by fleet calendar days for the relevant time period.
(8) Daily general and administrative expense is calculated by dividing
general and administrative expense by fleet calendar days for the relevant
time period.
(9) Total vessel operating expenses, or TVOE, is a measure of our total
expenses associated with operating our vessels. TVOE is the sum of vessel
operating expenses, management fees and general and administrative
expenses. Daily TVOE is calculated by dividing TVOE by fleet calendar days
for the relevant time period.
Conference Call and Webcast:
Later today, August 14, 2008 at 10:30 a.m. EDT, the company's management
will host a conference call to discuss the results.
Conference Call details:
Participants should dial into the call 10 minutes before the scheduled time
using the following numbers: 1 866 819 7111 (from the US), 0800 953 0329
(from the UK) or +44 (0)1452 542 301 (international standard dial in).
Please quote "Euroseas."
In case of any problems with the above numbers, please dial 1 866 223 0615
(from the US), 0800 694 1503 (from the UK) or +44 (0)1452 586 513
(international standard dial in). Quote "Euroseas."
A recording of the conference call will be available until August 21, 2008
by dialing 1 866 247 4222 (from the US), 0800 953 1533 (from the UK) or +44
(0)1452 550 000 (international standard dial in). Access Code: 6973591#
Audio webcast - Slides Presentation:
There will be a live and then archived audio webcast of the conference
call, via the internet through the Euroseas website (www.euroseas.gr).
Participants to the live webcast should register on the website
approximately 10 minutes prior to the start of the webcast.
A slides presentation on the second quarter and six month period ended June
30, 2008 results in PDF format will also be available 30 minutes prior to
the conference call and webcast accessible on the company's website
(www.euroseas.gr) on the webcast page. Participants to the webcast can
download the PDF presentation.
Euroseas Ltd.
Consolidated Condensed Statement of Income
(All amounts expressed in U.S. Dollars - except share amounts)
Three Three
Months Months Six Months Six Months
Ended Ended Ended Ended
June 30, June 30, June 30, June 30,
2007 2008 2007 2008
----------- ----------- ----------- -----------
(unaudited) (unaudited) (unaudited) (unaudited)
Revenues
Voyage revenue 16,341,028 35,982,504 30,524,348 70,453,207
Commissions (784,430) (1,518,387) (1,421,101) (3,167,155)
Net revenues 15,556,598 34,464,117 29,103,247 67,286,052
Operating expenses
Voyage expenses 182,008 902,168 328,623 2,117,459
Vessel operating
expenses 3,423,148 7,097,071 6,350,159 13,407,911
Amortization and
depreciation 3,472,104 8,486,784 6,163,131 16,456,481
Management fees 783,171 1,403,355 1,451,378 2,714,535
Other general and
administrative
expenses 434,280 1,256,180 683,916 2,297,429
Total operating
expenses 8,294,711 19,145,558 14,977,207 36,993,815
Net gain from sale of
vessel - - 3,411,397 -
Operating income 7,261,887 15,318,559 17,537,437 30,292,237
Other income/(expenses)
Interest and finance
cost (1,165,008) (677,742) (2,358,105) (1,700,736)
Interest income 303,725 723,422 695,981 1,860,219
Income from investments - 324,502 - 431,695
Foreign exchange
(loss)/gain (538) 8,444 60 (13,382)
Other expenses, net (861,821) 378,626 (1,662,064) 577,796
----------- ----------- ----------- -----------
Net income 6,400,066 15,697,185 15,875,373 30,870,033
----------- ----------- ----------- -----------
Earnings, per share,
basic 0.35 0.52 0.92 1.02
Weighted average number
of shares, basic 18,370,861 30,428,810 17,258,629 30,375,182
----------- ----------- ----------- -----------
Earnings, per share,
diluted 0.35 0.51 0.92 1.01
----------- ----------- ----------- -----------
Weighted average number
of shares, diluted 18,447,922 30,554,537 17,258,629 30,501,654
----------- ----------- ----------- -----------
Euroseas Ltd.
Consolidated Condensed Balance Sheet
(All amounts expressed in U.S. Dollars)
December 31, June 30,
2007 2008
------------- -------------
(unaudited) (unaudited)
ASSETS
Current Assets:
Cash and cash equivalents 104,135,320 68,700,764
Trade accounts receivable 1,174,045 1,533,923
Other receivables, net 741,081 668,113
Due from related company 5,291,197 3,852,494
Inventories 1,903,678 1,598,393
Restricted cash 1,739,879 1,895,523
Trading securities 2,891,658 2,865,707
Prepaid expenses 430,605 365,137
Total current assets 118,307,463 81,480,054
Fixed assets:
Vessels, net 238,248,984 276,640,894
Long-term assets:
Restricted cash 4,500,000 4,800,000
Deferred charges, net 5,529,870 7,092,133
Deferred offering expenses - 122,925
Fair value of above market time charter
acquired 4,604,514 3,128,968
Total long-term assets 252,883,368 291,784,920
Total assets 371,190,831 373,264,974
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Long term debt, current portion 25,575,000 17,310,000
Trade accounts payable 3,789,764 2,571,440
Accrued expenses 2,043,585 2,043,734
Accrued dividends - 132,675
Deferred revenue 3,774,162 2,954,554
Total current liabilities 35,182,511 25,012,403
Long-term liabilities:
Long term debt, net of current portion 56,015,000 49,790,000
Fair value of below market time charter
acquired 8,202,972 11,808,252
Total long-term liabilities 64,217,972 61,598,252
Total liabilities 99,400,483 86,610,655
Shareholders' equity:
Common stock (par value $0.03, 100,000,000
shares authorized, 30,261,113 and
30,430,236 issued and outstanding) 907,834 912,908
Preferred shares (par value $0.01,
20,000,000 shares authorized, no shares
issued and outstanding)
Additional paid-in capital 231,147,700 233,830,946
Retained earnings 39,734,814 51,910,465
Total shareholders' equity 271,790,348 286,654,319
Total liabilities and shareholders' equity 371,190,831 373,264,974
------------- -------------
Euroseas Ltd.
Consolidated Condensed Statements of Cash Flows
(All amounts expressed in U.S. Dollars)
Six Months Six Months
Ended Ended
June 30, June 30,
2007 2008
(unaudited) (unaudited)
----------- -----------
Cash flows from operating activities:
Net income 15,875,373 30,870,033
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation of vessels 5,613,098 14,787,848
Amortization of deferred charges 587,883 1,712,454
Amortization of fair value of time charters 1,231,626 (4,516,612)
Gain on sale of vessels (3,411,397) -
Share-based compensation - 877,398
Proceeds from sale of trading securities, net - 282,646
Gain on trading securities - (256,695)
Changes in operating assets and liabilities 1,426,504 (3,802,539)
----------- -----------
Net cash provided by operating activities 21,323,087 39,954,533
----------- -----------
Cash flows from investing activities:
Purchase of vessels including improvements (58,128,739) (43,582,320)
Change in restricted cash (733,359) (455,644)
Proceeds from sale of vessels 5,223,523 -
----------- -----------
Net cash (used in) investing activities (53,638,575) (44,037,964)
----------- -----------
Cash flows from financing activities:
Issuance of share capital 172,560 5,030
Net proceeds from shares issued 44,213,244 1,805,892
Dividends paid (7,185,754) (18,561,707)
Loan arrangement fees paid (40,000) -
Offering expenses paid (1,038,394) (110,340)
Proceeds from long-term debt 10,000,000 -
Repayment of long-term debts (9,370,000) (14,490,000)
----------- -----------
Net cash provided by / (used in) financing
activities 36,751,656 (31,351,125)
----------- -----------
Net increase / (decrease) in cash and cash
equivalents 4,436,168 (35,434,556)
Cash and cash equivalents at beginning of period 2,791,107 104,135,320
----------- -----------
Cash and cash equivalents at end of period 7,227,275 68,700,764
----------- -----------
Euroseas Ltd.
Reconciliation of Adjusted EBITDA to
Net Income and Cash Flow Provided By Operating Activities
(All amounts expressed in U.S. Dollars)
Three Months Three Months Six Months Six Months
Ended Ended Ended Ended
June 30, 2007 June 30, 2008 June 30, 2007 June 30, 2008
----------- ------------- ------------ -------------
Net income 6,400,066 15,697,185 15,875,373 30,870,033
----------- ------------- ------------ -------------
Interest and finance
costs, net (includes
interest income) 861,283 (45,680) 1,662,124 (159,483)
----------- ------------- ------------ -------------
Depreciation and
amortization 3,472,104 8,486,784 6,163,131 16,456,481
----------- ------------- ------------ -------------
Amortization of
deferred revenue
of below market
time charter
acquired (116,536) (3,142,739) (231,791) (5,992,158)
----------- ------------- ------------ -------------
Amortization of
deferred revenue
of above market
time charter
acquired 735,751 737,773 1,463,417 1,475,546
----------- ------------- ------------ -------------
Adjusted EBITDA 11,352,668 21,733,323 24,932,254 42,650,419
=========== ============= ============ =============
Three Months Three Months Six Months Six Months
Ended Ended Ended Ended
June 30, 2007 June 30, 2008 June 30, 2007 June 30, 2008
------------ ------------ ------------ ------------
Net cash flow provided
by operating
activities 12,478,230 17,199,980 21,323,087 39,954,533
------------ ------------ ------------ ------------
Changes in operating
assets / liabilities (1,971,114) 5,418,142 (1,426,504) 3,802,539
------------ ------------ ------------ ------------
Gain from vessel sale - - 3,411,397 -
------------ ------------ ------------ ------------
Gain on trading
securities, net - 239,653 - 256,695
------------ ------------ ------------ ------------
Investment on trading
securities, net - (547,828) - (282,646)
------------ ------------ ------------ ------------
Share based
compensation - (509,658) - (877,398)
------------ ------------ ------------ ------------
Interest, net 845,552 (66,966) 1,624,274 (203,304)
------------ ------------ ------------ ------------
Adjusted EBITDA 11,352,668 21,733,323 24,932,254 42,650,419
============ ============ ============ ============
EBITDA Reconciliation:
Euroseas Ltd. considers Adjusted EBITDA to represent net earnings before
interest, taxes, depreciation, amortization and amortization of deferred
revenues from above or below market time charters acquired. Adjusted EBITDA
does not represent and should not be considered as an alternative to net
income or cash flow from operations, as determined by United States
generally accepted accounting principles, or U.S. GAAP, and our calculation
of Adjusted EBITDA may not be comparable to that reported by other
companies. Adjusted EBITDA is included herein because it is a basis upon
which we assess our liquidity position and because we believe that it
presents useful information to investors regarding a company's ability to
service and/or incur indebtedness. The Company's definition of Adjusted
EBITDA may not be the same as that used by other companies in the shipping
or other industries.
Euroseas Ltd.
Reconciliation of Net Income Excluding the Effect from the Amortization
of the Fair Value of Charters Acquired and Gains from Vessel Sales to Net
Income (All amounts expressed in U.S. Dollars - except share data and
per share amounts)
Three Months Three Months Six Months Six Months
Ended Ended Ended Ended
June 30, 2007 June 30, 2008 June 30, 2007 June 30, 2008
------------ ------------- ------------- -------------
Net income 6,400,066 15,697,185 15,875,373 30,870,033
------------ ------------- ------------- -------------
Amortization of
deferred revenue
of below market
time charter
acquired (116,536) (3,142,739) (231,791) (5,992,158)
------------ ------------- ------------- -------------
Amortization of
deferred revenue
of above market
time charter
acquired 735,751 737,773 1,463,417 1,475,546
------------ ------------- ------------- -------------
Gain on vessel sale - - (3,411,397) -
------------ ------------- ------------- -------------
Net Income excluding
amortization of
the fair value
of charters
acquired and
gains on vessel
sales 7,019,281 13,292,219 13,695,602 26,353,421
------------ ------------- ------------- -------------
Net Income per
share excluding
amortization of
the fair value
of charters
acquired, basic 0.38 0.44 0.79 0.87
------------ ------------- ------------- -------------
Weighted average
number of shares,
basic 18,370,861 30,428,810 17,258,629 30,375,182
------------ ------------- ------------- -------------
Net Income per
share excluding
amortization of
the fair value
of charters
acquired,
diluted 0.38 0.44 0.79 0.86
------------ ------------- ------------- -------------
Weighted average
number of shares,
diluted 18,447,922 30,554,537 17,258,629 30,501,654
============ ============= ============= =============
About Euroseas Ltd.
Euroseas Ltd. was formed on May 5, 2005 under the laws of the Republic of
the Marshall Islands to consolidate the ship owning interests of the Pittas
family of Athens, Greece, which has been in the shipping business over the
past 136 years. Euroseas trades on the NASDAQ Global Select Market under
the ticker ESEA.
Euroseas operates in the dry cargo, drybulk and container shipping markets.
Euroseas' operations are managed by Eurobulk Ltd., an ISO 9001:2000
certified affiliated ship management company, which is responsible for the
day-to-day commercial and technical management and operations of the
vessels. Euroseas employs its vessels on spot and period charters and
through pool arrangements.
The Company has a fleet of 16 vessels, including 3 Panamax drybulk
carriers, 2 Handysize drybulk carriers, 3 Intermediate container ship, 5
Handysize container ships, 2 Feeder container ships and a multipurpose dry
cargo vessel. Euroseas` 5 drybulk carriers have a total cargo capacity of
277,316 dwt, its 10 container ships have a cargo capacity of 17,877 teu and
its 1 multipurpose vessel has a cargo capacity of 22,568 dwt or 950 teu.
Forward-Looking Statement
This press release contains forward-looking statements (as defined in
Section 27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended) concerning future events
and the Company's growth strategy and measures to implement such strategy;
including expected vessel acquisitions and entering into further time
charters. Words such as "expects," "intends," "plans," "believes,"
"anticipates," "hopes," "estimates," and variations of such words and
similar expressions are intended to identify forward-looking statements.
Although the Company believes that the expectations reflected in such
forward-looking statements are reasonable, no assurance can be given that
such expectations will prove to have been correct. These statements involve
known and unknown risks and are based upon a number of assumptions and
estimates that are inherently subject to significant uncertainties and
contingencies, many of which are beyond the control of the Company. Actual
results may differ materially from those expressed or implied by such
forward-looking statements. Factors that could cause actual results to
differ materially include, but are not limited to changes in the demand for
dry bulk vessels and container ships, competitive factors in the market in
which the Company operates; risks associated with operations outside the
United States; and other factors listed from time to time in the Company's
filings with the Securities and Exchange Commission. The Company expressly
disclaims any obligations or undertaking to release publicly any updates or
revisions to any forward-looking statements contained herein to reflect any
change in the Company's expectations with respect thereto or any change in
events, conditions or circumstances on which any statement is based.
Contact Information: Contact: Visit our website www.euroseas.gr Company Contact Tasos Aslidis Chief Financial Officer Euroseas Ltd. 11 Canterbury Lane Watchung, NJ 07069 Tel. (908) 301-9091 E-mail: aha@euroseas.gr Investor Relations / Financial Media Nicolas Bornozis President Capital Link, Inc. 230 Park Avenue, Suite 1536 New York, NY 10169 Tel. (212) 661-7566 E-mail: nbornozis@capitallink.com