Euroseas Ltd. Reports Results for the Third Quarter and Nine Month Period

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

30 Nov 2007

Euroseas Ltd., an owner and operator of drybulk and container carrier vessels and provider of seaborne transportation for drybulk and containerized cargoes, announced today its results for the third quarter and nine month period ended September 30, 2007.Third quarter 2007 Highlights:--  Net income of $9.5 million or $0.40 basic earnings per share    calculated on 23,934,434 weighted average number of shares outstanding on    total net revenues of $21.5 million. Diluted earnings per share were $0.39    calculated on 24,061,880 weighted average number of shares.  Earnings per    share for the third quarter of 2007 do not include $0.03 of cash flow    attributable to amortization of the fair value of period charter contracts    acquired that is usually included by security analysts in their published    estimates of earnings per share.--  Adjusted EBITDA was $15.2 million. Please refer to a subsequent    section of the Press Release for a reconciliation of adjusted EBITDA to net    income.--  An average 12.13 vessels were operated during the third quarter 2007    earning an average time charter equivalent rate of $20,024 per day.--  Declared a quarterly dividend of $0.29 per share for the third quarter    2007 payable on November 28, 2007 to shareholders of record as of November    5, 2007    Nine months 2007 Highlights:--  Net income of $25.3 million or $1.30 basic and diluted per share    calculated on 19,508,531 basic weighted average number of shares    outstanding and 19,557,805 diluted weighted average number of shares    outstanding on total net revenues of $50.6 million. Earnings per share for    the nine month period ended September 30, 2007 do not include $0.09 of cash    flow attributable to amortization of the fair value of period charter    contracts acquired that is usually included by security analysts in their    published estimates of earnings per share.--  Adjusted EBITDA was $40.2 million. Please refer to a subsequent    section of the Press Release for a reconciliation of adjusted EBITDA to net    income.--  An average 10.42 vessels were operated during the first nine months of    2007 earning an average time charter equivalent rate of $19,177 per day--  Declared quarterly dividends for the first, second and third quarters    of 2007, aggregating $0.78 per share.    Fleet Developments:--  In October 2007, took delivery of the M/V Tiger Bridge, a handysize    container ship the Company had previously agreed to acquire for $24    million, in August 2007. The vessel has a capacity of 31,627 dwt and 2,228    teu built in 1990 in South Korea. The vessels are employed on a time    charters until July 2009, at a rate of about $16,500 per day.--  In November 2007, took delivery of the M/V Ioanna P (ex M/V Trust    Jakarta), a panamax size drybulk carrier the Company had previously agreed    to acquire in October 2007, for $28.6 million. The vessel has a capacity of    64,873 dwt, built in 1984 in Japan, The vessel is employed under a period    charter contract at a rate of $35,500 per day till July 2008.--  Following these charter agreements, approximately 46% of Euroseas    total fleet days in 2008 are fixed under period charters, already concluded    spot charters, or, otherwise protected from market fluctuations.    Company Development:--  In November 2007, the Company announced the closing of its 5,825,000    share follow-on public offering at a price of $17.00 per share. Net    proceeds to Euroseas after underwriting discounts and estimated offering    expenses were approximately $93.4 million.  The Company intends to use the    net proceeds to acquire additional vessels in the drybulk and container    sectors and for general corporate purposes.Aristides Pittas, Chairman and CEO of Euroseas, commented: "The third quarter of 2007 has continued to be one of significant progress in the development of Euroseas as a public company. During the third quarter of 2007, we deployed the remaining of the proceeds of our July 2007 follow-on offering increasing our revenue base and market capitalization. Equally significantly, in November 2007, we completed our third follow-on common stock offering raising net proceeds of about $93 million, funds that will enable us to continue our growth. We have a fleet of 15 vessels and we intend to continue executing our plan to grow our fleet by focusing on age and size segments of the drybulk and containership sectors which we believe maximize our shareholder returns. The growth of our dividend from $0.57 per share for the first nine months of 2006 to $0.78 per share for the first nine months of 2007, a 37% increase, is the best evidence of the effectiveness of our investment and employment strategy, especially since it represents only a fraction of our net income even excluding any capital gains during those periods. We believe our strategy will enable us to continue providing consistent and significant dividends and overall returns to our shareholders."Tasos Aslidis, Chief Financial Officer of Euroseas, commented: "The results of the first nine months of 2007 reflect significantly higher revenues compared to the first nine months 2006 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 nine months of 2007, our fleet earned on average $19,177 per vessel per day compared to $13,766 per vessel per day during the same period in 2006. Daily vessel operating expenses including management fees during the first nine months of 2007 reflect an increase of about 12% on a per vessel per day basis compared to the same period in 2006. This is increase is mainly due to the increase in euro/dollar exchange rate, higher cost of lubricants due to higher oil prices and higher crew costs because of the increased competition in securing quality personnel.As of today, including the vessels we recently took delivery of, 46% of our ship capacity days in 2008 have been fixed under time charter contracts or protected from market fluctuations. We believe that our contract coverage gives us a solid revenue base for 2008 and beyond, more predictable cash flows and sufficient downside protection, while still allowing us to participate in the potential upside of the spot market during periods of rising market rates."Third quarter 2007 Results:For the third quarter of 2007, the Company reported total net revenues of $21.5 million and net income of $9.5 million representing a 141.1% and 76.6% increase, respectively, over total net revenues of $8.9 million and net income of $5.4 million during the third quarter of 2006. On average, 12.13 vessels were operated during the third quarter 2007 earning an average time charter equivalent rate of $20,024 per day compared to 7.35 vessels in the same period 2006 earning on average $14,536 per day. Net income for the third quarter of 2006 includes a $2.3 million capital gain from the sale of M/V "John P" in July 2006. Excluding this capital gain, net income in the third quarter of 2007 represents an increase of 207% over the third quarter of 2006.Adjusted EBITDA for the third quarter of 2007 was $15.2 million, a 104% increase of $7.5 million during the third quarter of 2006; exclusive of the capital gain in the third quarter of 2006, Adjusted EBITDA would have been $5.2 million resulting in an increase of 193%. Please see below for Adjusted EBITDA reconciliation to net income and cash flow provided by operating activities.Basic earnings per share for the third quarter of 2007 were $0.40, calculated on 23,934,434 weighted average number of shares outstanding, compared to earnings per share of $0.43, inclusive of a $0.18 capital gain per share on the sale of M/V "John P," for the third quarter of 2006, calculated on 12,620,114 weighted average number of shares outstanding. Diluted earnings per share were $0.39 and $0.43, the latter inclusive of capital gains of $0.18, for the third quarter of 2007 and 2006, respectively. The Company has recently declared a quarterly dividend of $0.29 per share, which represents its ninth consecutive quarterly dividend and a 38% increase over last year's third quarter dividend.Earnings per share for the third quarter of 2007 and 2006 do not include $0.03 and ($0.02) respectively of cash flow attributable to amortization of the fair value of period charter contracts acquired that is usually included by security analysts in their published estimates of earnings per share.Nine months Ended September 30, 2007 Results:For the nine months ended September 30, 2007, the company reported total net revenues of $50.6 million and net income of $25.3 million, representing a 77.9% and 65.4% increase, respectively over the same period of 2006. Adjusted EBITDA for the period was $40.2 million, a 87.0% increase over 2006 (please see below for Adjusted EBITDA reconciliation to net income and cash flow from operating activities). In the first nine months ended September 30, 2006, net revenues were $28.4 million, net income was $15.3 million and EBITDA was $21.5 million. On average, 10.42 vessels were operated during the period in 2007 earning an average time charter equivalent rate of $19,177 per day compared to 7.91 vessels in the same period 2006 earning a time charter equivalent rate of $13,766. Results for the nine month period ended September 30, 2007 included a capital gain of $3.4 million from the sale of M/V "Ariel," while results for the nine month period ended September 30, 2006 included a capital gain of $4.4 million from the sale of M/V "Pantelis P" and M/V "John P," three of the Company's handysize vessels. Excluding the capital gains, net income and Adjusted EBITDA for the nine month period ended September 30, 2007 increased 102% and 116%, respectively, over the same period of 2006Basic earnings per share for the nine months ended September 30, 2007, were $1.30, calculated on 19,508,531 weighted average number of shares outstanding, compared to earnings per share of $1.23 for the same period of 2006 calculated on 12,506,793 weighted average number of shares outstanding. Diluted earnings per share were $1.30 and $1.23 for the first nine months of 2007 and 2006, respectively.Earnings per share for the nine month period ended September 30, 2007 and 2006 do not include $0.09 and ($0.03) respectively of cash flow attributable to amortization of the fair value of period charter contracts acquired that is usually included by security analysts in their published estimates of earnings per share.