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Eagle Bulk Shipping Inc. Reports First Quarter 2013 Results

         Eagle Bulk Shipping Inc. Reports First Quarter 2013 Results

PR Newswire

NEW YORK, May 15, 2013

NEW YORK, May 15, 2013 /PRNewswire/ --Eagle Bulk Shipping Inc. (Nasdaq: EGLE)
today announced its results for the first quarter ended March 31, 2013.

For the First Quarter:

  oNet reported income of $1.4 million or $0.08 per share (based on a
    weighted average of 16,966,070 diluted shares outstanding for the
    quarter), compared with net loss of $17.4 million, or $1.11 per share, for
    the comparable quarter of 2012.

  oNet revenues of $72.2 million, compared to $52.6 million for the
    comparable quarter in 2012. Gross time charter and freight revenues of
    $73.6 million, compared with $54.8 million for the comparable quarter of
    2012.

  oEBITDA, as adjusted for exceptional items under the terms of the Company's
    credit agreement, was $32.5 million for the first quarter of 2013,
    compared with $13.8 million for the first quarter of 2012.
  oFleet utilization rate of 99.1%.

Sophocles N. Zoullas, Chairman and CEO, commented, "Conditions in the dry bulk
market remain challenging and, for the most part, unchanged from our most
recent earnings report. Though vessel supply dynamics are steadily improving,
they have not yet aligned with demand fundamentals. Our focus in this
environment continues to emphasize a flexible, opportunistic chartering
strategy, access to the relatively stable minor bulk trade, and operational
excellence and efficiency."

Results of Operations for the three-month period ended March 31, 2013 and 2012

For the first quarter of 2013, the Company reported net income of $1,374,270
or $0.08 per share, based on a weighted average of 16,966,070 diluted shares
outstanding. In the comparable first quarter of 2012, the Company reported net
loss of $17,433,529 or $1.11 per share, based on a weighted average of
15,750,821 diluted shares outstanding.

Gross time and voyage charter revenues in the quarter ended March 31, 2013
were $73,618,991, compared with $54,823,130 recorded in the comparable quarter
in 2012. The increase in revenue is attributable to the settlement agreement
with KLC, pursuant to which the Company recognized revenue of approximately
$32.8 million, offset by lower time charter rates earned by the fleet and a
marginal decrease in voyage charter revenues. Gross revenues recorded in the
quarter ended March 31, 2013 and 2012 include an amount of $10,280,559 and
$1,228,764, respectively, relating to the non-cash amortization of fair value
below contract value of time charters acquired of which $10,106,247 relates to
the KLC settlement agreement in the quarter ended March 31, 2013. Brokerage
commissions incurred on revenues earned in the quarter ended March 31, 2013
and 2012 were $1,396,638 and $2,206,730, respectively. Net revenues during the
quarter ended March 31, 2013 and 2012, were $72,222,353 and $52,616,400,
respectively.

Total operating expenses for the quarter ended March 31, 2013 were $47,420,291
compared with $60,118,356 recorded in the first quarter of 2012. The Company
operated 45 vessels in both first quarters of 2013 and 2012. The decrease in
operating expenses resulted primarily from a reduction in the allowance for
accounts receivable of approximately $3,438,145, lower professional fee costs
and compensation expenses in general and administrative expenses and a gain
realized from the settlement agreement with KLC of $3,331,692. The decrease in
depreciation and amortization expense is attributable to a lower drydock
amortization. In addition, there was a reduction in charter hire expenses as
none was incurred during the quarter ended March 31, 2013.

EBITDA, adjusted for exceptional items under the terms of the Company's credit
agreement, was $32,524,714 for the first quarter of 2013, compared with
$13,813,999 for the first quarter of 2012. (Please see below for a
reconciliation of EBITDA to net income / (loss).

Liquidity and Capital Resources

Net cash provided by operating activities during the three-month period ended
March 31, 2013, was $1,248,839, compared with net cash provided by operating
activities of $2,653,413 during the corresponding three-month period ended
March 31, 2012. The decrease was primarily due to lower rates on charter
renewals.

Net cash used by investing activities during the three-month period
endedMarch 31, 2013, was $49,994, compared with net cash provided by
investing activities of $338,400 during the corresponding three-month period
ended March 31, 2012.

Net cash used by financing activities during the three-month period ended
March 31, 2013, was $48,000, compared to none in 2012.

As of March 31, 2013, our cash balance was $19,270,813, compared to a cash
balance of $18,119,968 at December 31, 2012. Also recorded in Restricted Cash
is an amount of $276,056, which collateralizes letters of credit relating to
our office leases.

At March 31, 2013, the Company's debt consisted of $1,129,478,741 in term
loans and $22,561,496 paid-in-kind loans.

Disclosure of Non-GAAP Financial Measures

EBITDA represents operating earnings before extraordinary items, depreciation
and amortization, interest expense, and income taxes, if any. EBITDA is
included because it is used by certain investors to measure a company's
financial performance. EBITDA is not an item recognized by U.S. GAAP and
should not be considered a substitute for net income, cash flow from operating
activities and other operations or cash flow statement data prepared in
accordance with accounting principles generally accepted in the United States
or as a measure of profitability or liquidity. EBITDA is presented to provide
additional information with respect to the Company's ability to satisfy its
obligations including debt service, capital expenditures, and working capital
requirements. While EBITDA is frequently used as a measure of operating
results and the ability to meet debt service requirements, the definition of
EBITDA used herein may not be comparable to that used by other companies due
to differences in methods of calculation.

Our term loan agreement requires us to comply with financial covenants based
on debt and interest ratio with extraordinary or exceptional items, interest,
taxes, non-cash compensation, depreciation and amortization ("Credit Agreement
EBITDA"). Therefore, we believe that this non-U.S. GAAP measure is important
for our investors as it reflects our ability to meet our covenants. The
following table is a reconciliation of net income/(loss), as reflected in the
consolidated statements of operations, to the Credit Agreement EBITDA:

                                                 Three Months Ended
                                                 March 31,2013  March 31,2012
Net Income/(Loss)                                $ 1,374,270    $ (17,433,529)
Interest Expense                                   20,539,035     10,960,910
Depreciation and Amortization                      18,936,577     19,433,357
Amortization of fair value (below) above market    (10,280,559)   (1,228,764)
of time charter acquired
EBITDA                                             30,569,323     11,731,974
Non-cash Compensation Expense (1)                  1,955,391      2,082,025
Credit Agreement EBITDA                          $ 32,524,714   $ 13,813,999

(1)Stock based compensation related to stock options and restricted stock
units.

Capital Expenditures and Drydocking

Our capital expenditures relate to the purchase of vessels and capital
improvements to our vessels which are expected to enhance the revenue earning
capabilities and safety of these vessels.

In addition to acquisitions that we may undertake in future periods, the
Company's other major capital expenditures include funding the Company's
maintenance program of regularly scheduled drydocking necessary to preserve
the quality of our vessels as well as to comply with international shipping
standards and environmental laws and regulations. Although the Company has
some flexibility regarding the timing of its dry docking, the costs are
relatively predictable. Management anticipates that vessels are to be
drydocked every two and a half years. Funding of these requirements is
anticipated to be met with cash from operations. We anticipate that this
process of recertification will require us to reposition these vessels from a
discharge port to shipyard facilities, which will reduce our available days
and operating days during that period.

Drydocking costs incurred are deferred and amortized to expense on a
straight-line basis over the period through the date of the next scheduled
drydocking for those vessels. One vessel drydocked in the three months ended
March 31, 2013. The following table represents certain information about the
estimated costs for anticipated vessel drydockings in the next four quarters,
along with the anticipated off-hire days:

Quarter Ending             Off-hire Days^(1)        Projected Costs^(2)
June 30, 2013              44                       $1.20 million
September 30, 2013         22                       $0.60 million
December 31, 2013          44                       $1.20 million
March 31, 2014             44                       $1.20 million
^(1) Actual duration of drydocking will vary based on the condition of the
vessel, yard schedules and other factors

^(2) Actual costs will vary based on various factors, including where the
drydockings are actually performed

Summary Consolidated Financial and Other Data:

The following table summarizes the Company's selected consolidated financial
and other data for the periods indicated below.



CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)
                                           

                                           Three Months Ended
                                           March 31, 2013 March 31, 2012
Revenues, net of commissions               $72,222,353    $52,616,400
Voyage expenses                            8,204,657      7,017,793
Vessel expenses                            20,494,412     22,442,06
Charter hire expenses                      —              590,484
Depreciation and amortization              18,936,577     19,433,357
General and administrative expenses        3,116,337      10,634,660
Gain on time charter agreement termination (3,331,692)    —
 Total operating expenses               47,420,291     60,118,356
Operating income (loss)                    24,802,062     (7,501,956)
Interest expense                           20,539,035     10,960,910
Interest income                            (64,170)       (8,038)
Other expense (income)                     2,952,927      (1,021,299)
 Total other expense, net               23,427,792     9,931,573
Net income (loss)                          $1,374,270     $(17,433,529)


Weighted average shares outstanding:
Basic                                      16,966,070     15,750,821*
Diluted                                    16,966,070     15,750,821*


Per share amounts:
Basic net income (loss)                    $0.08          $(1.11)
Diluted net income (loss)                  $0.08          $(1.11)

* Adjusted to give effect to the 1 for 4 reverse stock split that became
effective on May 22, 2012, see Note 1.



Fleet Operating Data
                                        Three Months Ended
                                        March 31, 2013 March 31, 2012
Ownership Days                          4,050          4,095
Chartered-in under operating lease Days -              32
Available Days                          4,030          4,094
Operating Days                          3,992          4,041
Fleet Utilization                       99.1%          98.7%



CONSOLIDATED BALANCE SHEETS

(UNAUDITED)


                                            March 31, 2013  December 31, 2012
ASSETS:
Current assets:
Cash and cash equivalents                   $19,270,813      $18,119,968
Accounts receivable, net                    10,755,027       9,303,958
Prepaid expenses                            4,255,287        3,544,810
Inventories                                 12,719,310       12,083,125
Investment and other current asset          6,267,836        197,509
Fair value above contract value of time     —                549,965
charters acquired
  Total current assets              53,268,273       43,799,335
Noncurrent assets:
Vessels and vessel improvements, at cost,
net of accumulated                                          

 depreciation of $333,169,297 and          1,695,889,031    1,714,307,653
$314,700,681, respectively
Other fixed assets, net of accumulated
amortization of $595,242 and $515,896,     401,242          447,716
respectively
Restricted cash                             276,056          276,056
Deferred drydock costs                      2,392,520        2,132,379
Deferred financing costs                    23,036,131       25,095,469
Fair value above contract value of time     —                2,491,530
charters acquired
Other assets                                1,318,333        594,012
 Total noncurrent assets            1,723,313,313    1,745,344,815
Total assets                                $1,776,581,586   $1,789,144,150
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable                            $8,142,372       $10,235,007
Accrued interest                            1,047,546        2,430,751
Other accrued liabilities                   10,868,808       14,330,141
Deferred revenue and fair value below       —                3,237,694
contract value of time charters acquired
Unearned charter hire revenue               3,948,943        3,755,166
  Total current liabilities          24,007,669       33,988,759
Noncurrent liabilities:
Long-term debt                              1,129,478,741    1,129,478,741
Payment-in-kind loans                       22,561,496       15,387,468
Deferred revenue and fair value below       —                13,850,772
contract value of time charters acquired
Fair value of derivative instruments        1,420,611        2,243,833
 Total noncurrent liabilities       1,153,460,848    1,160,960,814
Total liabilities                           1,177,468,517    1,194,949,573
Commitment and contingencies
Stockholders' equity:
Preferred stock, $.01 par value, 25,000,000 —                —
shares authorized, none issued
Common stock, $.01 par value, 100,000,000
shares authorized, 16,638,092 and                           
16,638,092 shares issued 
                                            166,378          166,378
 and outstanding, respectively
Additional paid‑in capital                  764,268,421      762,313,030
Retained earnings (net of historical        (163,901,119)    (165,275,389)
dividends declared of $262,118,388)
Accumulated other comprehensive loss        (1,420,611)      (3,009,442)
  Total stockholders' equity         599,113,069      594,194,577
Total liabilities and stockholders' equity  $1,776,581,586   $1,789,144,150





CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)


                                                Three Months Ended
                                                March 31, 2013  March 31, 2012
Cash flows from operating activities:
Net income (loss)                               $1,374,270      $(17,433,529)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Items included in net income (loss) not
affecting cash flows:
Depreciation                                    18,515,090      18,728,907
Amortization of deferred drydocking costs       421,487         704,450
Amortization of deferred financing costs        2,075,338       1,135,491
Amortization of fair value below contract value (10,280,559)    (1,228,764)
of time charter acquired
Payment-in-kind interest on debt                7,174,028       —
Unrealized gain from forward freight            —               (142,560)
agreements, net
Investment and other current asset              (4,925,953)     —
Realized loss from investment                   2,952,927       —
Gain on time charter agreement termination      (3,331,692)     —
Allowance for accounts receivable               —               3,438,145
Non‑cash compensation expense                   1,955,391       2,082,025
Drydocking expenditures                         (681,628)       (527,465)
Changes in operating assets and liabilities:
Accounts receivable                             (1,451,069)     (2,444,647)
Other assets                                    (724,321)       436,455
Prepaid expenses                                (710,477)       565,346
Inventories                                     (636,185)       (533,862)
Accounts payable                                (2,092,635)     (138,469)
Accrued interest                                (1,383,205)     (580,140)
Accrued expenses                                (3,429,333)     902,638
Deferred revenue                                (3,766,412)     (124,548)
Unearned revenue                                193,777         (2,186,060)
Net cash provided by operating activities       1,248,839       2,653,413
 Cash flows from investing activities:
Vessels and vessel improvements and advances    (49,994)        (54,659)
for vessel construction
Purchase of other fixed assets                  —               (1,303)
Changes in restricted cash                      —               394,362
Net cash (used in) provided by investing        (49,994)        338,400
activities
Cash flows from financing activities:
Deferred financing costs                        (48,000)        —
Net cash used in financing activities           (48,000)        —
Net increase in cash                            1,150,845       2,991,813
Cash at beginning of period                     18,119,968      25,075,203
Cash at end of period                           $19,270,813     $28,067,016



We have employed all of our vessels in our operating fleet on time and voyage
charters. The following table represents certain information about our revenue
earning charters with respect to our operating fleet as of March 31, 2013:



                    Year            Charter           Daily Charter Hire
Vessel                      Dwt     Expiration (1)     Rate
                    Built
Avocet              2010    53,462  Apr 2013           Voyage(2)
Bittern             2009    57,809  May 2013         $ 8,150
Canary              2009    57,809  Apr 2013         $ 7,100 (2)
Cardinal            2004    55,362  May 2013         $ 8,000
Condor              2001    50,296  Apr 2013        $ 4,700(2)
Crane               2010    57,809  Apr 2013         $ 7,500(2)
Crested Eagle       2009    55,989  May 2013         $ 11,000
Crowned Eagle       2008    55,940  -                  Spot
Egret Bulker       2010    57,809  July 2013       $ 10,250
Falcon              2001    50,296  May 2013         $ 7,200
Gannet Bulker       2010    57,809  Apr 2013         $ 10,000(2)
Golden Eagle        2010    55,989  May 2013         $ 12,400
Goldeneye           2002    52,421  May 2013           Index(3)
Grebe Bulker        2010    57,809  Apr 2013         $ 15,000(2)
Harrier             2001    50,296  May 2013         $ 10,000
Hawk I              2001    50,296  Apr 2013           Voyage(2)
Ibis Bulker         2010    57,775  Jun 2013         $ 8,900
Imperial Eagle      2010    55,989  Apr 2013         $ 11,150(2)
Jaeger              2004    52,248  Apr 2013         $ 13,000(2)
Jay                 2010    57,802  Apr 2013           Voyage(2)
Kestrel I           2004    50,326  Apr 2013         $ 9,500(2)
 Kingfisher      2010    57,776  Apr 2013           Voyage(2)
Kite                1997    47,195  Apr 2013           Voyage(2)
Kittiwake           2002    53,146  Aug 2013         $ 9,500
Martin              2010    57,809  Apr 2013           Voyage(2)
Merlin              2001    50,296  Apr 2013         $ 10,000(2)
Nighthawk           2011    57,809  May 2013         $ 8,350
Oriole              2011    57,809  Apr 2013         $ 7,000(2)
Osprey I            2002    50,206  Apr 2013         $ 8,000(2)
Owl                 2011    57,809  Apr 2013         $ 12,500(2)
Peregrine           2001    50,913  Jun 2013         $ 8,250
                                                       $17,650(4) (with 50%
Petrel Bulker       2011    57,809  May 2014 to Sep
                                    2014               profit share over
                                                       $20,000)
                                                       $17,650(4) (with 50%
Puffin Bulker       2011    57,809  May 2014 to Sep
                                    2014               profit share over
                                                       $20,000)
Redwing             2007    53,411  Apr 2013         $ 9,800(2)
                                                       $17,650(4) (with 50%
Roadrunner Bulker  2011    57,809  Aug 2014 to Dec
                                    2014               profit share over
                                                       $20,000)
                                                       $17,650(4) (with 50%
Sandpiper Bulker   2011    57,809  Aug 2014 to Dec
                                    2014               profit share over
                                                       $20,000)
Shrike              2003    53,343  Apr 2013           Voyage(2)
Skua                2003    53,350  Apr 2013         $ 4,500(2)
Sparrow             2000    48,225  Jun 2013         $ 8,400
Stellar Eagle       2009    55,989  Nov 2013           Index(3)
Tern                2003    50,200  Apr 2013         $ 12,000(2)
Thrasher            2010    53,360  May 2013         $ 12,500
Thrush              2011    53,297  Apr 2013         $ 13,000(2)
Woodstar        2008    53,390  -                  Spot(2)
Wren                2008    53,349  Apr 2013         $ 10,500(2)





     The date range provided represents the earliest and latest date on which
     the charterer may redeliver the vessel to the Company upon the
 (1) termination of the charter. The time charter hire rates presented are
     gross daily charter rates before brokerage commissions, ranging from
     0.625% to 5.00%, to third party ship brokers.
 (2) Upon conclusion of the previous charter the vessel will commence a short
     term charter for up to six months.
 (3) Index, an average of the trailing Baltic Supramax Index.
 (4) The charterer has an option to extend the charter by two periods of 11 to
     13 months each.



Glossary of Terms:

Ownership days: The Company defines ownership days as the aggregate number of
days in a period during which each vessel in its fleet has been owned.
Ownership days are an indicator of the size of the fleet over a period and
affect both the amount of revenues and the amount of expenses that is recorded
during a period.

Chartered-in under operating lease days: The Company defines chartered-in
under operating lease days as the aggregate number of days in a period during
which the Company chartered-in vessels.

Available days: The Company defines available days as the number of ownership
days less the aggregate number of days that its vessels are off-hire due to
vessel familiarization upon acquisition, scheduled repairs or repairs under
guarantee, vessel upgrades or special surveys and the aggregate amount of time
that we spend positioning our vessels. The shipping industry uses available
days to measure the number of days in a period during which vessels should be
capable of generating revenues.

Operating days: The Company defines operating days as the number of its
available days in a period less the aggregate number of days that the vessels
are off-hire due to any reason, including unforeseen circumstances. The
shipping industry uses operating days to measure the aggregate number of days
in a period during which vessels actually generate revenues.

Fleet utilization: The Company calculates fleet utilization by dividing the
number of our operating days during a period by the number of our available
days during the 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
other than scheduled repairs or repairs under guarantee, vessel upgrades,
special surveys or vessel positioning. Our fleet continues to perform at very
high utilization rates.

Conference Call Information

Members of Eagle Bulk's senior management team will host a teleconference and
webcast at 8:30 a.m. ET on Thursday, May 16th to discuss the results.

To participate in the teleconference, investors and analysts are invited to
call 866-510-0707 in the U.S., or 617-597-5376  outside of the U.S., and
reference participant code 49839481. A simultaneous webcast of the call,
including a slide presentation for interested investors and others, may be
accessed by visiting http://www.eagleships.com.

A replay will be available following the call until 11:59 PM ET on May 23,
2013. To access the replay, call 888-286-8010  in the U.S., or 617-801-6888
outside of the U.S., and reference passcode 43657265.

About Eagle Bulk Shipping Inc.

Eagle Bulk Shipping Inc. is a Marshall Islands corporation headquartered in
New York. The Company is a leading global owner of Supramax dry bulk vessels
that range in size from 50,000 to 60,000 deadweight tons and transport a broad
range of major and minor bulk cargoes, including iron ore, coal, grain, cement
and fertilizer, along worldwide shipping routes.

Forward-Looking Statements

Matters 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, 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, management's examination of historical operating
trends, data contained in our records and other data available from third
parties. Although Eagle Bulk Shipping 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, Eagle Bulk Shipping 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 the
strength of world economies and currencies, general market conditions,
including changes in charter hire rates and vessel values, changes in demand
that may affect attitudes of time charterers to scheduled and unscheduled
drydocking, changes in our vessel operating expenses, including dry-docking
and insurance costs, or actions taken by regulatory authorities, potential
liability from future litigation, domestic and international political
conditions, potential disruption of shipping routes due to accidents and
political events or acts by terrorists.

Risks and uncertainties are further described in reports filed by Eagle Bulk
Shipping Inc. with the US Securities and Exchange Commission.

Visit our website at www.eagleships.com

SOURCE Eagle Bulk Shipping Inc.

Website: http://www.eagleships.com
Contact: Company Contact: Adir Katzav, Chief Financial Officer, Eagle Bulk
Shipping Inc., Tel. +1 212-785-2500, Investor Relations / Media: Jonathan
Morgan, Perry Street Communications, New York, Tel. +1 212-741-0014