SOURCE: Quintana Maritime Limited

May 07, 2007 08:45 ET

Quintana Maritime Limited Reports First Quarter 2007 Results and Declares Dividend of $0.24 per Share

ATHENS, GREECE -- (MARKET WIRE) -- May 7, 2007 -- Quintana Maritime Limited (NASDAQ: QMAR), a leading international provider of dry bulk transportation services, announced today its operating and financial results for the three months ended March 31, 2007.

Year to Date 2007 Highlights:

--  Increased our presence in the Capesize sector by agreeing to acquire
    interests in 8 Capesize newbuilding vessels, which will increase the size
    of our fleet to 37 vessels upon delivery of all vessels
--  Leveraged our relationship with our sponsors by entering into joint
    ventures for construction of Capesize vessels
--  Increased our cargo-carrying capacity by 55% to 4.1 million dwt
    (deadweight tons), including newbuilding capacity
--  Set 2009 rates under charter with Bunge, fixing 74% of our estimated
    net operating days in 2009, which corresponds to approximately $186 million
    of expected net revenues
--  Increased net revenues by approximately 121% over first quarter of
--  Added unique 5-year charters with EDFT, a wholly owned subsidiary of
    EDF, one of the largest utilities in Europe, with a charter structure that
    allows us to take advantage of market upside while providing downside
First Quarter 2007 Results:

For the first quarter of 2007, Quintana reported net income of $12.5 million, or $0.23 per diluted share. This includes a non-cash unrealized swap loss of $2.2 million on the previously disclosed interest-rate swap. Before this loss, net income was $14.7 million, or $0.27 per diluted share, an increase of approximately 17% over $0.23 per diluted share in the first quarter last year. Net revenues for the first quarter were $47.8 million, an increase of approximately 121% over $21.6 million of net revenues in the first quarter of 2006. Adjusted EBITDA for the first quarter of 2007 was $38.6 million, an increase of $23.4 million, or almost 154%, over Adjusted EBITDA of $15.2 million in the first quarter of 2006. During the first quarter of 2007, Quintana operated an average of 24.5 vessels, earning an average time charter equivalent (TCE) rate of $23,053 per ship per day. During the corresponding period in 2006, the Company operated an average of 10.0 vessels, earning an average TCE rate of $23,935 per day.

Stamatis Molaris, President and Chief Executive Officer of Quintana Maritime commented, "Our first quarter 2007 results are underpinned by the strong growth of our fleet. Our fleet grew to 27 vessels at quarter end from 10 vessels a year ago. We are very pleased to see that the growth strategy we embarked on a year ago is starting to pay off for our shareholders. We believe our Company will continue to strongly benefit from our secured growth through 2007 and beyond."

Completion of Metrobulk Fleet Acquisition and Late Delivery Payments:

The Company has successfully completed the acquisition of the Metrobulk fleet. It has taken delivery of all 17 vessels it contracted to acquire in early May last year at the price of $735 million. The last vessel was delivered to the Company on April 3, 2007.

Mr. Molaris commented, "The Metrobulk fleet acquisition has indeed proven to be a transformational acquisition in every respect. We agreed to purchase these 17 vessels during a period that the Baltic Panamax Index was almost 60% lower than it is today, and we believe that the acquisition has given the Company a leadership position in the Panamax sector."

During the quarter, Quintana collected approximately $1.7 million from the sellers of the Metrobulk fleet. These collections represented charter-hire earned by Quintana in accordance with the signed purchase agreements with the sellers. However, as the vessels had not been delivered to Quintana on the contractual delivery dates, those collections were not recorded to the income statement but were instead applied against the vessels' cost. The Company has collected an aggregate of $3.1 million in payments from the sellers of the Metrobulk fleet, reducing the aggregate purchase price of the Metrobulk fleet to approximately $732 million.

Capesize Expansion through Joint Ventures with Company's Major Sponsors:

Our stated strategy has been to rapidly grow the Company and to provide consistent dividends to our shareholders. In late 2006, we began to pursue the acquisition of Capesize vessels as a result of steadily rising Asian demand for those vessels. As our revenues began to reflect the full effect of the chartering to Bunge of the 17 vessels we purchased from Metrobulk, we were able to take advantage of the rising Capesize market, purchasing Iron Miner in late 2006, Lowlands Beilun in early 2007, and agreeing to purchase a newbuilding Capesize of 180,000 dwt from Imabari for delivery in 2008. We decided to purchase these vessels through wholly owned subsidiaries because the gap between purchase and delivery was comparatively short, thereby minimizing the dilutive effect of the acquisitions. Since we agreed to purchase these vessels, asset values in the Capesize sector have continued to rise. The 2008 delivery is wholly owned by the Company and is fixed on a five-year charter with Transfield at $39,000 net per day upon delivery. Before financing, the Company is expected to invest $18.3 million on this vessel during 2007 and the remaining $74.7 million during the second half of 2008. The Company intends to finance the construction costs with existing cash, borrowings under its existing credit facility and cash flow from future operations.

In order to take advantage of the rising demand for Capesize vessels, we have embarked on a newbuilding program to purchase seven additional Capesize vessels of 180,000 dwt for delivery in 2010. Because these acquisitions would be dilutive to earnings, we have entered into joint ventures with our sponsors to minimize this dilutive effect but still allowing us to rapidly grow the Company. The remaining 7 newbuildings will be purchased by joint ventures formed or to be formed in the second quarter. One of the 7 joint ventures is owned 42.8% by the Company and by 57.2% by Robertson Maritime Investors LLC ("RMI"), an affiliate of Corbin Robertson Jr. and AMCI Cape Holdings LLC ("AMCIC"), an affiliate of Hans Mende. Mr. Robertson is the Chairman of our Board of Directors and of the Compensation, Nominating & Governance Committee (the "CNG Committee") of the Board, and Mr. Mende is a member of the Board of Directors. Members of Mr. Robertson's family, including Corbin J. Robertson III, who is a member of our Board, may participate in the joint venture through Mr. Robertson. In addition, First Reserve Corporation is an investor in AMCI Capital, LLC, which owns AMCIC directly. Joseph R. Edwards, who is a member of our Board and a member of the CNG Committee, is a director of First Reserve Corporation. Messrs. Robertson, Mende, and Molaris will serve on the joint venture's board of directors. Under the agreement governing this joint venture, the Company is not obligated for any pre-delivery payments. Instead, the Company will fund the delivery installment due to the seller in 2010.

The remaining 6 joint ventures are owned 50% by the Company and 50% by AMCIC. Under the agreements governing these joint ventures, the Company and its joint venture partners are responsible pro rata for all payments due to the shipyard. The joint ventures have already secured 5 out of the 7 newbuildings on five-year charters from delivery at an average net daily floor rate of approximately $27,000 with a 50% profit sharing above the floor rate with EDF Trading, a wholly owned subsidiary of EDF, one of the largest power-generation utilities in Europe. The profit sharing will be based on the monthly AV4 time-charter BCI (Baltic Capesize Index), as published by the Baltic Exchange. Before financing, the Company is expected to invest approximately $48.4 million in 2007, $4.7 million in 2008, $49.5 million in 2009 and $177.4 million at delivery during 2010. Messrs. Mende and Molaris will serve on the joint ventures' respective boards of directors. The Company intends to finance its investment in these joint ventures with existing cash and cash flow from future operations. The joint ventures will finance the construction through capital contributions from the joint venture partners and debt.

The Company's Conflicts Committee, which is made up of three of the Company's independent non-executive directors, has approved one of the joint venture transactions and is required to approve the remaining six joint venture transactions.

Mr. Molaris commented, "We are very pleased to have positioned the Company for further growth in the Capesize sector. It was our stated strategic objective to direct the Company's growth into the fast-growing Capesize sector. The current high asset prices encouraged us to pursue this expansion through the newbuilding market to avoid paying significant premiums for promptly delivered Capes. I am also very pleased to have entered into partnerships with our two strategic sponsors, which we believe further cement their long-term commitment to the sector through their direct investment in the vessels under construction. We believe our Company's shareholders will benefit from our further expansion into the Capesize sector, which is currently enjoying high demand, with high-quality assets secured at attractive prices." He further commented, "We also welcome the growing relationship with EDF, one of Europe's major end users of commodities. We expect our charters with EDF to generate in excess of $240 million over the life of the charters, without including any profit sharing. Developing long-term relationships with major end users and producers of commodities is a key part of our strategy and its success is fully manifested in the quality of our customer base. We are looking forward to developing our relationship with this particular investment grade customer. We believe that the particular structure of these time charter contracts insulates our shareholders' exposure to downside market risk, but provides significant cash flow upside potential in the Capesize sector."

Pricing of Bunge Charters through end of 2009:

As of April 3, 2007, the Company had taken delivery of all the Metrobulk vessels. All 17 vessels that the Company had agreed to acquire in May 2006 are on long-term time charter to Bunge S.A., a wholly owned subsidiary of Bunge Limited (NYSE: BG), an integrated global agribusiness. 16 of the 17 vessels are fixed until the end of 2010 under an agreement that provides for variable charter hire, negotiated annually between predetermined floor and ceiling rates, and a Panamax, Grain Harvester, is on time charter with Bunge through July 2009 at $20,000 per day.

Quintana Maritime has already priced all 16 vessels under the master time charter for 2008 and all 17 vessels for 2009. The Company has priced the 14 Kamsarmaxes and 2 Panamaxes at an average daily rate of $24,500 for 2008, which is almost 10% higher than the average daily rate of $22,284 achieved for 2007. In addition, the Company has also priced all seventeen vessels for 2009 at an average daily rate of approximately $21,800 (including Grain Harvester upon the expiration of its current charter), which represents the ceiling rate under the master charter agreement with Bunge.

Time Charter Coverage:

Stamatis Molaris, President and CEO, stated, "With the pricing of our entire Metrobulk fleet more than two years in advance, we believe our shareholders will enjoy high cash-flow visibility through the end of 2009. We believe that we have positioned our Company as one of the most visible cash flow providers in the dry bulk industry at profitable rates that we expect to enhance long-term shareholder value."

Mr. Molaris continued, "Our strategy is to predominantly employ our vessels under long period time charters, which enable us to generate stable and predictable cash flows. In this context, we are pleased to have secured almost 96% of our fleet capacity on time charters for 2007, almost 81% for 2008 and almost 74% for 2009, corresponding to expected net revenues of $215 million, $209 million and $186 million, respectively. We continue to believe that the current size of the fleet together with our significant charter coverage allows us to optimize our chartering practices in the future by entering into time charter structures, such as the one agreed with EDF Trading, that allow us to share part of the upside with our customers and by trading some vessels in the spot market if we determine that market conditions are appropriate. We believe this strategy will allow us to further generate additional upside potential during a buoyant market without risking significant revenues in case of a market downturn."


The Board of Directors of Quintana has declared a dividend of $0.24 per share, payable on May 31, 2007 to all shareholders of record as of May 18, 2007. Inclusive of this dividend, Quintana has declared aggregate dividends of $1.57 per share since August 2005. The dividend payment of $0.24 per share is consistent with the guidance provided by the Board of Directors of a minimum annualized payment of $0.96 per share for 2007.

Paul J. Cornell, Chief Financial Officer of Quintana Maritime, commented, "We are pleased to have declared our eighth consecutive quarterly dividend. This demonstrates a consistent track record of dividend payments, while we continue to grow the company's fleet."


Through the end of the first quarter of 2007, a total of 5,678,995 warrants of the 8,182,232 originally issued had been exercised, and the Company had collected net proceeds of approximately $43.2 million from the exercise. As of March 31, 2007, 2,503,237 warrants remained outstanding. If the remaining warrants were exercised, the Company would expect to receive gross proceeds of approximately $20 million.

Management of Interest-Rate Risk:

Our revolving credit facility bears interest at a floating rate. Because we determined that fixing an interest rate would be beneficial to the Company and its shareholders, the Company entered into an interest rate swap agreement with Fortis Bank S.A., effective from July 1, 2006 through December 31, 2010, which effectively fixes interest at 5.985%, inclusive of spread, for a loan amount of $725 million under our revolving credit facility.

Because the swap does not qualify for hedge accounting, the Company marks to market the fair value of the hedge at the end of every reporting period, which may result in significant fluctuations from period to period. The non-cash liability of $12.1 million at March 31, 2007, after a non-cash loss of $2.2 million was recorded during the first quarter of 2007, reflects the fair value of the hedge at the end of the period. This charge was primarily due to the fact that the variable-rate interest portion of the swap is tied to forward LIBOR rates, which were comparatively lower in the second half of 2006 and early 2007.

Annual Meeting:

At Quintana's 2007 Annual Meeting of Stockholders, which was held in Athens on May 4, 2007, Quintana's stockholders re-elected all eight current directors to the Board and ratified the selection of Deloitte.Hadjipavlou, Sofianos & Cambanis, S.A. as the Company's independent auditors for 2007.

Conference Call details:

At 10 am EDT today, May 7, management will host a conference call discussing the quarterly results.

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 (from outside the US). Please quote "Quintana."

In case of any problems with the above numbers, please dial 1 866 869 2352 (from the US), 0800 694 1449 (from the UK) or +44 (0)1452 560 304 (from outside the US). Quote "Quintana."

A telephonic replay of the conference call will be available until May 14, 2007 by dialing 1 866 247 4222 (from the US), 0800 953 1533 (from the UK) or +44 (0)1452 550 000 (from outside the US). Access Code: 1859591#

Slides and audio webcast:

There will also be a live, and then archived, webcast of the conference call, available through Quintana Maritime's website ( Participants for the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

                        QUINTANA MARITIME LIMITED

                       CONSOLIDATED BALANCE SHEETS

  (All amounts expressed in thousands of U.S. Dollars except share data)

                                                   March 31,   December 31,
                     ASSETS                           2007         2006
                                                  -----------  -----------
Current assets:
    Cash and cash equivalents                     $    25,286  $    21,335
    Inventories                                         2,366        1,649
    Due from charterers, net                            1,564        1,159
    Other receivables                                   1,457        1,196
    Prepaid expenses and other current assets           1,596          986
                                                  -----------  -----------
      Total current assets                             32,269       26,325

Property and equipment:
    Vessels, net of accumulated depreciation of
     $52,904 and $40,899                            1,195,197      987,623
    Advances for acquisition of vessels                47,210       26,310
    Other fixed assets, net of accumulated
     depreciation of $325 and $265                        397          429
                                                  -----------  -----------
      Total property and equipment                  1,242,804    1,014,362

Deferred charges:
    Financing costs, net of accumulated
     amortization of $444 and $2,169                    4,951        4,588
    Time charter premium, net of accumulated
     amortization of $3,079 and $2,551                  6,421        6,949
    Dry-docking costs, net of accumulated
     amortization of $1,336 and $970                    5,069        5,216
                                                  -----------  -----------
      Total assets                                $ 1,291,514  $ 1,057,440
                                                  ===========  ===========

Current liabilities:
    Accounts payable                              $     4,632  $     5,369
    Sundry liabilities and accruals                     3,803        2,776
    Deferred income                                    13,239        2,777
    Current portion of long-term debt                  47,000       47,000
                                                  -----------  -----------
      Total current liabilities                        68,674       57,922
Long-term debt, net of current portion                752,300      564,960
Unrealized interest-rate swap loss                     12,051        9,840
                                                  -----------  -----------
      Total liabilities                           $   833,025  $   632,722
                                                  -----------  -----------

Shareholders’ equity
    Common stock at $0.01 par value--100,000,000
     shares authorized, 54,785,770 and 50,026,533
     shares outstanding                                   549          501
    Additional paid-in capital                        478,824      442,776
    Common stock to be issued for warrants
     exercised                                             --        1,438
    Accumulated deficit                               (20,884)     (19,997)
                                                  -----------  -----------
      Total shareholders’ equity                      458,489      424,718
                                                  -----------  -----------
      Total liabilities and shareholders’ equity  $ 1,291,514  $ 1,057,440
                                                  ===========  ===========

           The accompanying notes are an integral part of these
                   consolidated financial statements.

                        QUINTANA MARITIME LIMITED


  (All amounts expressed in thousands of U.S. Dollars except per share data)

                                                     Three Months Ended
                                                          March 31,
                                                      2007         2006
                                                  -----------  -----------
    Time charter revenue                          $    50,130  $    20,911
    Voyage revenue                                         --        1,633
    Commissions                                        (2,373)        (966)
                                                  -----------  -----------
      Net revenue                                 $    47,757  $    21,578

    Vessel operating expenses                           7,465        3,771
    Voyage expenses                                        --        1,508
    General and administrative expenses
     (including restricted stock compensation of
     $1,057 and $435)                                   3,562        2,037
    Depreciation and amortization                      12,432        6,056
                                                  -----------  -----------
      Total expenses                                   23,459       13,372
                                                  -----------  -----------
Operating income                                  $    24,298  $     8,206

Other (expenses) / income:
    Interest expense                              $   (10,346) $    (2,771)
    Interest income                                       745           39
    Finance costs                                        (234)         (63)
    Unrealized interest-rate swap loss                 (2,211)          --
    Foreign exchange gains/(losses) and other,
     net                                                  241          (43)
                                                  -----------  -----------
      Total other expenses                        $   (11,805) $    (2,838)
                                                  -----------  -----------

Net income                                        $    12,493  $     5,368
                                                  ===========  ===========

Earnings per common share:
    Basic                                         $      0.24  $      0.23
                                                  ===========  ===========
    Diluted                                       $      0.23  $      0.23
                                                  ===========  ===========

Weighted average shares outstanding:
    Basic                                          52,794,611   23,387,742
                                                  ===========  ===========
    Diluted                                        54,943,309   23,846,742
                                                  ===========  ===========

           The accompanying notes are an integral part of these
                   consolidated financial statements.

                        QUINTANA MARITIME LIMITED


          (All amounts expressed in thousands of U.S. Dollars)

                                                     Three Months Ended
                                                          March 31,
                                                      2007         2006
                                                  -----------  -----------
Cash flows from operating activities:
    Net income                                    $    12,493  $     5,368
    Adjustments to reconcile net income to net
     cash from operating activities:
      Depreciation and amortization                    12,432        6,056
      Amortization of deferred finance costs              234           63
      Amortization of time charter fair value             528          528
      Restricted stock compensation                     1,057          435
      Unrealized interest-rate swap loss                2,211           --
    Changes in assets and liabilities:
      Increase in inventories                            (717)        (796)
      (Increase) / decrease in due from
        charterers, net                                  (405)         771
      Increase in other receivables                      (261)        (171)
      Increase in prepaid expenses and other
       current assets                                    (610)         (23)
      (Decrease) / increase in accounts payable          (737)         503
      Increase / (decrease) in sundry liabilities
       and accruals                                     1,027         (167)
      Increase / (decrease) in deferred income         10,462         (213)
      Dry-dock costs paid                                (220)          --
                                                  -----------  -----------
         Net cash from operating activities       $    37,494  $    12,354
                                                  -----------  -----------

Cash flows from investing activities:
    Vessel acquisitions                              (197,578)          --
    Advances for vessel acquisitions                  (42,900)          --
    Purchases of other fixed assets                       (29)         (59)
                                                  -----------  -----------
         Net cash used in investing activities    $  (240,507) $       (59)
                                                  -----------  -----------

Cash flows from financing activities:
    Proceeds from long-term debt                      187,340           --
    Repayment of long-term debt                            --       (8,000)
    Payment of financing costs                           (597)          --
    Warrants exercised, net of issuance costs          33,601           --
    Dividends paid                                    (13,380)      (5,008)
                                                  -----------  -----------
         Net cash from (used in) financing
          activities                              $   206,964  $   (13,008)
                                                  -----------  -----------
Net increase / (decrease) in cash and cash
 equivalents                                            3,951         (713)
Cash and cash equivalents at beginning of period       21,335        4,259
                                                  -----------  -----------
Cash and cash equivalents at end of the period    $    25,286  $     3,546
                                                  ===========  ===========
Supplemental disclosure of cash flow information:
    Cash paid during the period for interest      $    10,500  $     3,184
                                                  ===========  ===========

           The accompanying notes are an integral part of these
                   consolidated financial statements.

                        Quintana Maritime Limited
              Reconciliation of Net Income to Adjusted EBITDA
           (All amounts expressed in thousands of U.S. Dollars)

                                              Three Months Ended March 31,
                                                     2007        2006
                                                   --------    --------
Net Income                                         $ 12,493       5,368
Interest and finance costs, net                       9,835       2,795
Depreciation and amortization                        12,432       6,056
Unrealized interest-rate swap loss                    2,211          --
Amortization of time charter fair value                 528         528
Stock-based compensation                              1,057         435
                                                   --------    --------
Adjusted EBITDA                                    $ 38,556      15,182

                        Quintana Maritime Limited
            Reconciliation of Net Income to Adjusted Net Income
           (All amounts expressed in thousands of U.S. Dollars)

                                              Three Months Ended March 31,
                                                     2007        2006
                                                   --------    --------
Net Income                                         $ 12,493       5,368
Unrealized interest-rate swap loss                    2,211          --
                                                   --------    --------
Adjusted Net Income                                $ 14,704       5,368

                       Quintana Maritime Limited
  Reconciliation of Earnings Per Share (Diluted) to Adjusted Earnings Per
                              Share (Diluted)
                  (All amounts expressed in U.S. Dollars)

                                              Three Months Ended March 31,
                                                     2007        2006
                                                   --------    --------
Earnings per share (diluted)                       $   0.23    $   0.23
Unrealized interest-rate swap loss                     0.04          --
                                                   --------    --------
Adjusted earnings per share (diluted)              $   0.27    $   0.23
Disclosure of Non-GAAP Financial Measures

Adjusted EBITDA represents net income plus interest and finance costs plus depreciation and amortization and income taxes, if any, plus deferred stock-based compensation, and amortization of time charter fair value and unrealized interest-rate swap loss, which are non-cash items. Adjusted EBITDA is included because it is used by certain investors to measure a company's financial performance and by the Company as a financial target. Adjusted EBITDA is a "non-GAAP financial measure" 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. Adjusted EBITDA is presented to provide additional information with respect to the Company's ability to satisfy its obligations including debt service, capital expenditures, working capital requirements and determination of dividends. While Adjusted EBITDA is frequently used as a measure of operating results and the ability to meet debt service requirements, the definition of Adjusted EBITDA used here may not be comparable to that used by other companies due to differences in methods of calculation.

Adjusted Net Income represents net income plus unrealized interest-rate swap loss, which is a non-cash item. Adjusted Earnings per Share (diluted) represents Adjusted Net Income divided by weighted average shares outstanding (diluted). These measures are "non-GAAP financial measures" and should not be considered substitutes for net income or earnings per share (diluted), respectively, as reported under GAAP. The Company has included an adjusted net income and adjusted earnings per share calculation in this period in order to allow comparability between the Company's performance in the reported periods and its performance in prior periods.


Quintana Maritime Limited, based in Greece, is an international provider of dry bulk cargo marine transportation services. As of today, the company owns and operates a fleet of 29 vessels, including 14 Kamsarmax bulkers, 11 Panamax size vessels and 4 Capesize vessels with a total carrying capacity of 2,644,043 dwt and an average age of 4.1 years on a dwt weighted average. In addition, Quintana has ordered 8 Capesize newbuilding vessels, one of which will be wholly owned and the remaining seven of which are partially owned through joint ventures. Once all acquisitions and newbuild orders are completed and assuming no vessel disposals, Quintana will have a fleet of 37 dry bulk vessels, including 12 Capesize vessels, 11 Panamax vessels and 14 Kamsarmax vessels, with a total capacity of 4,086,043 dwt. The deadweight average age of the whole fleet, including the Capesize vessels on order, currently is 1.6 years.

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. Such statements include comments regarding expected revenues and time charters. 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 which 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, 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.


The following key indicators highlight the Company's financial and operating performance during the first quarters of 2007 and 2006:

                     Three Months Ended March    Three Months Ended March
                              31,2007                     31,2006
                    ==========================  ==========================
                    =======  ========  =======  =======  ========  =======

Total Ownership
 days                 2,009       198    2,207      720       180      900
Operating days
 under fixed rate
 time charter         1,913       197     2110      626       180      806
Operating days
 under variable
 rate time charter       87         -       87       90         -       90
Utilization            99.6%     99.7%    99.6%    99.4%      100%    99.5%
Time charter
 equivalent per
 ship per day -
 fixed rate tc       21,528    32,374   22,541   21,818    35,047   24,773
Time charter
 equivalent per
 ship per day -
 variable rate tc    35,456         -   35,456   16,432         -   16,432
Net daily revenue
 per ship per day    20,995    30,870   21,879   20,106    33,538   22,792
Vessel operating
 expenses per ship
 per day             (3,319)   (4,029)  (3,383)  (4,186)   (4,208)  (4,190)
Net Operating Cash
 Flow per ship per
 day before general
 and administrative
 expenses            17,676    26,840   18,496   15,920    29,330   18,602
                    =======  ========  =======  =======  ========  =======
(1) M/V Iron Beauty was acquired with an existing time charter at an above the market rate. The company deducts the fair value of the time charter from the purchase price of the vessel and allocates it to a deferred asset which is amortized over the remaining period of the time charter as a reduction to hire revenue. This results in a daily rate of approximately $30,600 as recognized revenue. For cash flow purposes the company will continue to receive $ 36,500 per day, less commissions.

Glossary of Terms

Average number of vessels: This is the number of vessels that constituted our fleet for the relevant period, as measured by the sum of the number of days each vessel was a part of our fleet during the period divided by the number of calendar days in that period.

Ownership days: We define ownership days as the aggregate number of days in a period during which each vessel in our fleet has been owned by us. Ownership 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 a period.

Operating days: We define operating days as the number of our available days in a period less the aggregate number of days that our vessels are off-hire due to planned dry docking repairs or any other, 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: We calculate fleet utilization by dividing the number of our operating days during a period by the number of our Ownership 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.

TCE per ship per day: We define TCE (time-charter equivalent) per ship per day rate as our voyage and time charter revenues less voyage expenses during a period divided by the number of our operating days during the period, which is consistent with industry standards. TCE rate is a shipping industry performance measure used primarily to compare daily earnings generated by vessels on time charters with daily earnings generated by vessels on voyage charters, because charter hire rates for vessels on voyage charters are generally not expressed in per day amounts while charter hire rates for vessels on time charters generally are expressed in such amounts.

Net daily revenue: We define the daily TCE rate net of commissions but including idle time.

Vessel operating expenses per ship per day: These include crew wages and related costs, the cost of insurance, expenses relating to repairs and maintenance, the cost of spares and consumable stores, tonnage taxes and other miscellaneous expenses. We define as our total operating costs divided by the ownership days.

Fleet Table as of May 7, 2007

                                                              TC Expiration
                                          Year     Age        Date (minimum
CURRENT FLEET         Type       DWT      Built   (in yrs)    period)
                    ---------- --------- ----- ---------- -----------------
Lowlands Beilun(C)    Capesize   170,162  1999        8.0        March 2010
Iron Manolis(A)      Kamsarmax    82,300  2007        0.1     December 2010
Iron Brooke(A)       Kamsarmax    82,300  2007        0.1     December 2010
Iron Miner            Capesize   177,000  2007        0.2      January 2012
Iron Lindrew(A)      Kamsarmax    82,300  2007        0.2     December 2010
Iron Knight(A)         Panamax    76,429  2004        2.9     December 2010
Coal Hunter(A)       Kamsarmax    82,300  2006        0.4     December 2010
Pascha(A)            Kamsarmax    82,300  2006        0.4     December 2010
Coal Gypsy(A)        Kamsarmax    82,300  2006        0.4     December 2010
Iron Anne(A)         Kamsarmax    82,000  2006        0.6     December 2010
Iron Vassilis(A)     Kamsarmax    82,000  2006        0.8     December 2010
Iron Bill (A)        Kamsarmax    82,000  2006        0.9     December 2010
Santa Barbara(A)     Kamsarmax    82,266  2006        1.1     December 2010
Ore Hansa(A)         Kamsarmax    82,229  2006        1.1     December 2010
Iron Kalypso(A)      Kamsarmax    82,204  2006        1.3     December 2010
Iron Fuzeyya(A)      Kamsarmax    82,229  2006        1.3     December 2010
Iron Bradyn(A)       Kamsarmax    82,769  2005        2.2     December 2010
Grain Harvester(A)     Panamax    76,417  2004        2.7         July 2009
Grain Express(A)       Panamax    76,466  2004        3.1     December 2010
Kirmar( B)            Capesize   165,500  2001        5.6        March 2008
Iron Beauty( B)       Capesize   165,500  2001        5.8        April 2010
Coal Pride(E)          Panamax    72,600  1999        7.4     February 2009
Iron Man (C)           Panamax    72,861  1997        9.9        March 2010
Coal Age (C)           Panamax    72,861  1997        9.9    September 2007
Fearless 1(C)          Panamax    73,427  1997       10.0        March 2008
Barbara (D)            Panamax    73,390  1997       10.3         July 2007
Linda Leah (D)         Panamax    73,390  1997       10.3     February 2008
King Coal              Panamax    72,873  1997       10.4        March 2008
Coal Glory (C)         Panamax    73,670  1995       12.2         June 2008
                    ---------- --------- ----- ---------- -----------------
                                               4.1 years
Total Current Fleet 29 Vessels 2,644,043          avg (J)

                                             Year    Age      Delivery
FLEET TO BE  DELIVERED    Type       DWT     Built   (in yrs) Range
                        ---------- --------- ----- ---------- -------------
Newbuilding 1(E)          Capesize   180,000  2008          * November 2008
Newbuilding 2(E) (H)      Capesize   180,000  2010          *    March 2010
Newbuilding 3(F) (I)      Capesize   181,000  2010          *  October 2010
Newbuilding 4(F) (I)      Capesize   181,000  2010          * December 2010
Newbuilding 5(G) (I)      Capesize   180,000  2010          *      May 2010
Newbuilding 6(G) (I)      Capesize   180,000  2010          *     June 2010
Newbuilding 7(G) (I)      Capesize   180,000  2010          *     July 2010
Newbuilding 8(G)(I)       Capesize   180,000  2010          *   August 2010
                        ---------- --------- ----- ---------- -------------
Total Fleet to be
 Delivered               8 Vessels 1,442,000
                        ---------- --------- ----- ---------- -------------
                                                   1.6 years
TOTAL FLEET             37 Vessels 4,086,043          avg (J)
* Under Construction

(A), (B), (C), (D), (E), (F) and (G) indicate sister ships. As of May 7, 2007 Quintana had five sets of sister ships, including the vessels recently acquired from Metrobulk. All seventeen ships that are part of the Metrobulk acquisition are sister ships. Sister ships indicate vessels of the same class made in the same shipyard. The sister-ship concept further enhances our operational flexibility and efficiency.

(H) Quintana holds a 42.8% interest in the joint venture that will own this vessel.

(I) Quintana will hold a 50% interest in the joint ventures that will own these vessels.

(J) On a dwt weighted average

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