SOURCE: Quintana Maritime Limited

March 06, 2007 16:42 ET

Quintana Maritime Limited Reports Fourth Quarter and Annual 2006 Results and Prices the Remaining Five Kamsarmaxes for 2008

ATHENS, GREECE -- (MARKET WIRE) -- March 6, 2007 -- Quintana Maritime Limited (NASDAQ: QMAR), a leading international provider of dry bulk transportation services, announced today its operating and financial results for the fourth quarter and full year ended December 31, 2006.

2006 Highlights:

--  Increased annual dividend guidance by approximately 15% to $0.96 per
    share in 2007, representing a current yield of 7.2%
--  Agreed to acquire 18 vessels, during weak market conditions, which
    nearly triples the size of our fleet to 28 vessels upon delivery of all
    vessels
--  Increased our carrying capacity by more than 300% and reduced dwt-
    weighted-average age of fleet by more than 50%
--  Fixed over 96% of our net operating days in 2007, providing secure and
    predictable cash flows to our shareholders
--  Increased net revenues by approximately 156% over 2005
--  Added unique 5-year charter with major customer allowing us to take
    advantage of market upside with limited exposure to downswings
--  Demonstrated our capacity to manage newbuilding process and expand
    operational personnel to accommodate fleet additions
--  Successfully implemented Sarbanes-Oxley 404 review without any
    material weaknesses
    
Fourth Quarter 2006 Results:

For the fourth quarter of 2006, Quintana reported net income of $10.8 million, or $0.21 per diluted share. This includes a non-cash unrealized swap gain of $2.1 million on the previously disclosed interest-rate swap. Before this gain, net income was $8.7 million, or $0.17 per diluted share. Net revenues for the fourth quarter were $37.0 million, an increase of almost 82% over $20.3 million of net revenues in the fourth quarter of 2005. Adjusted EBITDA for the quarter of 2006 was $28.6 million, an increase of $13.4 million, or almost 88%, over Adjusted EBITDA of $15.2 million in the fourth quarter of 2005. During the fourth quarter of 2006, Quintana operated an average of 20.5 vessels, earning an average time charter equivalent (TCE) rate of $21,566 per ship per day. During the fourth quarter of 2005, the Company operated an average of 9.4 vessels, earning an average TCE rate of $25,585 per day.

Full Year 2006 Results:

For the full year 2006, Quintana reported net income of $12.7 million and diluted earnings per share of $0.37. This includes non-cash unrealized swap loss of $9.8 million and a non-cash write-off of unamortized financing fees due to the repayment of our previous revolving credit facility of $1.9 million. Before these charges, net income was $24.4 million, or $0.70 per diluted share.

Net revenues for 2006 were $103.3 million, an increase of almost 156% over $40.3 million of net revenues for last year. Adjusted EBITDA for the full year was approximately $75.1 million, an increase of $46.5 million, or almost 163%, over Adjusted EBITDA of $28.6 million in 2005. During 2006, Quintana operated an average of 13.5 vessels, earning an average TCE rate of $22,116 per ship per day, compared to an average of 5.0 ships in 2005, earning an average TCE rate of $24,328 per day.

Stamatis Molaris, President and Chief Executive Officer of Quintana Maritime, commented, "We are pleased to have concluded fiscal year 2006 with our strongest operational results to date. These results were a consequence of the growth of our fleet from 10 vessels to 23 vessels over the course of 2006. Our somewhat lower average TCE rate resulted from lower charter rates earned on time charters fixed near the beginning of 2006, which was a challenging market environment. Our fleet growth in 2006 was among the fastest of the public dry bulk companies worldwide. The Company will continue to strongly benefit from the growth of our fleet throughout 2007, as we expect to take delivery of two additional Capes and two additional Kamsarmaxes."

Metrobulk Late Delivery Payments:

During the year, Quintana collected approximately $1.4 million, or approximately $0.04 per diluted share, from the sellers of the Metrobulk fleet. Of this amount, Quintana collected $0.3 million, or approximately $0.01 per diluted share, in the fourth quarter. 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, such collections were not recorded to the income statement but were instead applied against vessels' cost. The Company has collected an additional $1.7 million in payments since year end, reducing the aggregate purchase price of the Metrobulk fleet by a total of $3.1 million to $731.9 million.

Fixture of Metrobulk Fleet:

In 2006, Quintana agreed to purchase 17 vessels from Metrobulk. As of today, we had taken delivery of 15 of the Metrobulk vessels. All vessels 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 set floor and ceiling rates, and a Panamax, Grain Harvester, is on time charter with Bunge through September 2009 at $20,000 per day.

Quintana Maritime has already priced all 16 vessels under the master time charter for 2008. The Company has priced the 14 Kamsarmaxes and 2 Panamaxes at an average daily rate of $24,500, which is almost 10% higher than the average daily rate of $22,284 achieved for 2007.

Time Charter Coverage:

Stamatis Molaris, President and CEO, stated, "We are delighted to have priced our entire Metrobulk fleet for 2008, at an average rate that is very close to the ceiling rate under the master charter and well ahead of the scheduled negotiations. Over the next two years, we will enjoy the high visibility of cash flow, which we believe to be among the most predictable of the public dry bulk companies, at rates that we expect to enhance 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 time charter coverage for 2007 and almost 81% for 2008. As a result, our projected net revenues under fixed time charters for the fiscal years 2007 and 2008 will be approximately $215 million and $208 million respectively, based on forecast revenues. In addition, we believe that the current size of the fleet together with our significant charter coverage will allow us to optimize our chartering practices in the future, including trading some vessels in the spot market if we determine that market conditions are appropriate. We believe this strategy would allow us to generate additional upside potential during a buoyant market without risking significant revenues in case of a market downturn."

Dividend:

As previously announced, the Board of Directors of Quintana had declared a dividend of $0.24 per share, payable on March 16, 2007 to all shareholders of record as of March 2, 2007. Inclusive of this dividend, Quintana declared dividends of $0.87 per share with respect to periods in 2006 and aggregate dividends of $1.33 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, Quintana's Chief Financial Officer of Quintana Maritime, commented, "We are pleased to have declared our seventh consecutive quarterly dividend. This demonstrates a consistent track record of dividend payments, while we continue to grow the company's fleet."

Warrants:

As of December 31, 2006, a total of 1,062,079 warrants of the 8,182,232 originally issued had been exercised, and the Company had collected an amount of approximately $8.5 million. As of February 28, 2007, an additional 3,607,571 warrants had been exercised, resulting in gross proceeds to the Company of approximately $28.9 million. As of February 28, 2007, 3,512,582 warrants remained outstanding. If the remaining warrants were exercised, the Company would expect gross proceeds of approximately $28.1 million.

Management of Interest-Rate Risk:

The Company entered into an interest swap agreement with Fortis Bank S.A., effective from July 1, 2006 through December 31, 2010, which effectively fixes interest due under the new revolving credit facility at a rate of 5.985%, inclusive of the spread due its lenders.

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 charge of $9.8 million recorded at December 31, 2006 after a non-cash gain of $2.1 million during the fourth quarter of 2006, 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.

Conference Call details:

At 10 am EST tomorrow, March 7, management will host a conference call discussing the quarterly and full year 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 March 14th, 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 (www.quintanamaritime.com). 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



                                                   December 31,
                                              -----------------------
                                                 2006        2005
                                              ----------- -----------
ASSETS                                        (unaudited)
Current assets :
  Cash and cash equivalents                   $    21,335 $     4,259
  Inventories                                       1,649         378
  Due from charterers, net                          1,159       1,244
  Other receivables                                 1,196         480
  Prepaid expenses and other current assets           986         867
                                              ----------- -----------
      Total current assets                         26,325       7,228

Property and equipment:
  Vessels, net of accumulated depreciation of
   $40,899 and $11,309                            987,623     446,475
  Advances for acquisition of vessels              26,310          --
  Other fixed assets, net of accumulated
   depreciation of $265 and $59                       429         384
                                              ----------- -----------
      Total property and equipment              1,014,362     446,859

Deferred charges:
  Financing costs, net of accumulated
   amortization of $2,169 and $5,190                4,588       1,959
  Time charter premium, net of accumulated
   amortization of $2,551 and $440                  6,949       9,060
  Dry docking costs, net of accumulated
   amortization of $970 and $280                    5,216         920
                                              ----------- -----------
     Total assets                             $ 1,057,440 $   466,026
                                              =========== ===========

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities :
  Accounts payable                            $     5,369 $     1,474
  Sundry liabilities and accruals                   2,776       3,413
  Deferred income                                   2,777       1,716
  Short-term portion of long-term debt             47,000          --
                                              ----------- -----------
     Total current liabilities                     57,922       6,603

Long-term debt                                    564,960     210,000
Unrealized swap loss                                9,840          --
                                              ----------- -----------
     Total liabilities                        $   632,722 $   216,603

Total shareholders' equity                        424,718     249,423
                                              ----------- -----------
     Total liabilities and shareholders'
      equity                                  $ 1,057,440 $   466,026
                                              =========== ===========



                        Quintana Maritime Limited
                      Consolidated Income Statements
(All amounts expressed in thousands of U.S. Dollars except per share data)


                                                               Period From
                                                               January 13,
                            Three Months Ended    Year Ended     2005 to
                               December 31,       December 31,   Dec. 31,
                            2006         2005        2006         2005
                        -----------  -----------  -----------  -----------
                              (unaudited)         (unaudited)
                        ------------------------  -----------  -----------

Revenues:
   Time charter revenue $    38,810  $    21,256  $   103,667  $    42,062
   Voyage revenue                --           --        4,474           --
   Commissions               (1,809)        (952)      (4,824)      (1,787)
                        -----------  -----------  -----------  -----------
      Net revenue       $    37,001  $    20,304      103,317       40,275

Expenses:
   Vessel operating
    expenses                  6,109        3,197       17,489        7,411
   Voyage expenses               15           --        4,083           --
   General and
    administrative
    expenses (including
    restricted stock
    amortization of
    $672, $301, $2,298
    and $616)                 3,593        2,597       10,790        5,301
   Depreciation and
    amortization             10,887        5,719       30,486       11,648
                        -----------  -----------  -----------  -----------
      Total expenses    $    20,604  $    11,513       62,848       24,360
                        -----------  -----------  -----------  -----------
Operating income        $    16,397  $     8,791       40,469       15,915

Other (expenses) /
 income:
   Interest expense     $    (8,265) $    (2,464)     (16,615)      (5,367)
   Interest income              629           68        1,199          228
   Finance costs                (95)      (1,604)      (2,169)      (5,190)
   Unrealized swap
    gain/(loss)               2,052           --       (9,840)          --
   Foreign exchange
    gains/(losses) and
    other, net                   73          (54)        (300)         (58)
                        -----------  -----------  -----------  -----------
      Total other
       expenses         $    (5,606) $    (4,054)     (27,725)     (10,387)

Net income              $    10,791  $     4,737  $    12,744  $     5,528
                        ===========  ===========  ===========  ===========

Earnings per common
 share:
   Basic                $      0.22  $      0.20  $      0.38  $      0.39
                        ===========  ===========  ===========  ===========
   Diluted              $      0.21  $      0.20  $      0.37  $      0.39
                        ===========  ===========  ===========  ===========

Weighted average shares
 outstanding:
   Basic                 49,637,284   23,287,992   33,568,793   14,134,268
                        ===========  ===========  ===========  ===========
   Diluted               52,362,593   23,580,019   34,680,371   14,239,907
                        ===========  ===========  ===========  ===========



                        Quintana Maritime Limited
                  Consolidated Statements of Cash Flows
           (All amounts expressed in thousands of U.S. Dollars)


                                                              Period from
                                                              January 13,
                                                 Year Ended     2005 to
                                                December 31,  December 31,
                                                    2006          2005
                                                ------------  ------------
                                                (unaudited)


Cash flows from operating activities:
  Net income                                    $     12,744  $      5,528
  Adjustments to reconcile net income to net
   cash from operating activities:
    Depreciation and amortization                     30,486        11,648
    Amortization of deferred finance costs             2,169         5,190
    Amortization of time charter fair value            2,111           440
    Amortization of stock-based compensation           2.298           616
    Unrealized swap loss                               9,840            --
  Changes in assets and liabilities:
    Increase in inventories                           (1,271)         (378)
    Decrease / (Increase) in due from
     charterers, net                                      85        (1,244)
    Increase in other receivables                       (716)         (480)
    Increase in prepaid expenses and other
     current assets                                     (119)         (867)
    Increase in accounts payable                       3,895         1,474
    (Decrease) / Increase in sundry liabilities
     and accruals                                       (637)        3,413
    Increase in deferred income                        1,061         1,716
    Deferred dry-dock costs incurred                  (4,986)       (1,200)
                                                ------------  ------------
      Net cash from operating activities        $     56,960  $     25,856
                                                ------------  ------------

Cash flows from investing activities:
  Vessel acquisitions                               (570,738)     (457,784)
  Advances for vessel acquisitions                   (26,310)           --
  Time charter premium                                    --        (9,500)
  Purchases of property, plant and equipment            (251)         (443)
                                                ------------  ------------
      Net cash used in investing activities     $   (597,299) $   (467,727)
                                                ------------  ------------

Cash flows from financing activities:
  Proceeds from long-term debt                       611,960       628,621
  Repayment of long-term debt                       (210,000)     (418,621)
  Payment of financing costs                          (4,798)       (7,149)
  Proceeds from preferred stock issuance             190,938            --
  Issuance costs of preferred stock and
   warrants                                           (8,308)           --
  Proceeds from the exercise of warrants               8,497            --
  Common stock to be issued for warrants
   exercised                                           1,507
  Paid-in capital and common stock                        --        68,405
  Proceeds from initial public offering                   --       182,942
  Issuance costs of initial public offering               --        (2,180)
  Dividends paid                                     (32,381)       (5,888)
                                                ------------  ------------
      Net cash from financing activities        $    557,415  $    446,130
                                                ------------  ------------

Net increase in cash and cash equivalents             17,076         4,259
Cash and cash equivalents at beginning of
 period                                                4,259            --
                                                ------------  ------------
Cash and cash equivalents at end of the period  $     21,335  $      4,259
                                                ============  ============

Supplemental disclosure of cash flow
 information:
  Cash paid during the period for interest      $     18,994  $      3,064
                                                ============  ============



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

                                                                   Period
                                                                    from
                                                                  January
                                    Three Months        Year         13,
                                  Ended December 31,    ended      2005 to
                                 --------------------  December   December
                                   2006        2005    31, 2006   31, 2005
                                 ---------  ---------  ---------  ---------
Net Income                       $  10,791  $   4,737  $  12,744  $   5,528
                                 ---------  ---------  ---------  ---------
Interest and finance costs, net      7,731      4,000     17,585     10,329
Depreciation and amortization       10,887      5,719     30,486     11,648
Unrealized swap (gain)/ loss        (2,052)         -      9,840          -
Amortization of  time charter
 fair value                            528        440      2,111        440
Stock-based compensation               672        301      2,298        616
                                 =========  =========  =========  =========
Adjusted EBITDA                  $  28,557  $  15,197  $  75,064  $  28,561



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

                                                                   Period
                                                                    from
                                                                  January
                                    Three Months        Year         13,
                                  Ended December 31,    ended      2005 to
                                 --------------------  December   December
                                   2006        2005    31, 2006   31, 2005
                                 ---------  ---------  ---------  ---------
Net Income                       $  10,791  $   4,737  $  12,744  $   5,528
                                 ---------  ---------  ---------  ---------
Unamortized write-off of
 financing costs                        --      1,511      1,833      4,707
Unrealized swap (gain)/loss         (2,052)        --      9,840         --
                                 ---------  ---------  ---------  ---------
Adjusted Net Income              $   8,739  $   6,248  $  24,417  $  10,235
                                 ---------  ---------  ---------  ---------



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

                                                                   Period
                                                                    from
                                                                  January
                                    Three Months        Year         13,
                                  Ended December 31,    ended      2005 to
                                 --------------------  December   December
                                   2006        2005    31, 2006   31, 2005
                                 ---------  ---------  ---------  ---------
Earnings per share (diluted)     $    0.21  $    0.20  $    0.37  $    0.39
                                 ---------  ---------  ---------  ---------
Unamortized write-off of
 financing costs                        --       0.06       0.05       0.33
Unrealized swap (gain)/loss          (0.04)        --       0.28         --
                                 ---------  ---------  ---------  ---------
Adjusted earnings per share
 (diluted)                       $    0.17  $    0.26  $    0.70  $    0.72
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 loss on swap transaction, 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 unamortized write-off of financing costs and unrealized loss from swap transaction, which are non-cash items. 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.

ABOUT QUINTANA MARITIME LIMITED

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 25 vessels, including 12 Kamsarmax bulkers, 11 Panamax size vessels and 2 Capesize vessels with a total carrying capacity of 2,132,281 dwt and an average age of 4.2 years on a dwt weighted average. It has also entered into agreements to acquire 2 additional Kamsarmax bulkers with expected delivery between March and May 2007 and with an aggregate capacity of 164,600 dwt. In addition, Quintana has recently entered into agreements to acquire 2 Capesize vessels of an aggregate 347,162 dwt with expected delivery between March and April 2007. Once all acquisitions are completed, Quintana will have a fleet of 29 dry bulk vessels, including 4 Capesize vessels, 11 Panamax vessels and 14 Kamsarmax vessels, with a total capacity of 2,644,043 dwt and an average age of 3.9 years on a dwt weighted average.

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.


Appendix

The following key indicators highlight the Company's financial and operating performance during the fourth quarter and full year of 2006:


                                   Three Months Ended December 31, 2006
                                   ------------------------------------
                                                       CHARTER
                                 PANAMAX   CAPESIZE       IN       TOTAL
                                =========  =========  =========  =========

Total Ownership days                1,706        184                 1,890
Operating days under fixed rate
 time charter                       1,570        162                 1,732

Operating days under variable
 rate time charter                     91                               91
Operating days under spot
 charter
Utilization                          97.4%      88.0%                 96.5%
Time charter equivalent per
 ship per day - fixed rate tc      19,903     31,685                21,004
Time charter equivalent
 per ship per day - variable
 rate tc                           32,283                           32,283
Net daily revenue per ship per
 day                               19,116     26,677                19,852
Vessel operating expenses per
 ship per day                      (3,204)    (3,483)               (3,232)
Net Operating Cash Flow per
 ship per day before general
 and administrative expenses       15,912     23,194                16,620
                                =========  =========             =========




                                   Three Months Ended December 31, 2005
                                   ------------------------------------
                                                       CHARTER
                                 PANAMAX   CAPESIZE       IN       TOTAL
                                =========  =========  =========  =========

Total Ownership days                  736        126                   862
Operating days under fixed rate
 time charter                         636        121                   757

Operating days under variable
 rate time charter                     91                               91
Operating days under spot
 charter
Utilization                          98.8%      95.6%                 98.3%
Time charter equivalent per
 ship per day - fixed rate tc      22,635     43,851                26,332
Time charter equivalent
 per ship per day - variable
 rate tc                           19,446                           19,446
Net daily revenue per ship per
 day                               21,006     41,930                24,064
Vessel operating expenses per
 ship per day                      (3,745)    (3,501)               (3,709)
Net Operating Cash Flow per
 ship per day before general
 and administrative expenses       17,261     38,429                20,355
                                =========  =========             =========




                                   Twelve Months Ended December 31, 2006
                                ------------------------------------------
                                                       CHARTER
                                 PANAMAX   CAPESIZE       IN       TOTAL
                                =========  =========  =========  =========

Total Ownership days                4,142        730        139      5,011
Operating days under fixed rate
 time charter                       3,721        688                 4,409
Operating days under variable
 rate time charter                    364                              364
Operating days under spot
 charter                                                    139        139
Utilization                          98.6%      94.2%     100.0%      98.0%
Time charter equivalent per
 ship per day - fixed rate tc      20,248   32,166(1)               22,107
Time charter equivalent per
 ship per day - variable rate tc   22,858                           22,858
Time charter equivalent per
 ship per day - spot                                     20,589     20,589
Charter in costs per ship per
 day - spot                                             (17,771)   (17,771)
Net daily revenue per ship per
 day                               19,289     28,986      2,022     20,225
Vessel operating expenses per
 ship per day                      (3,557)    (3,773)               (3,590)
Management fees
Net Operating Cash Flow per
 ship per day before general
 and administrative expenses       15,732     25,213      2,022     16,635
                                =========  =========  =========  =========




                                   Twelve Months Ended December 31, 2005
                                ------------------------------------------
                                                       CHARTER
                                 PANAMAX   CAPESIZE       IN       TOTAL
                                =========  =========  =========  =========

Total Ownership days                1,709        126                 1,835
Operating days under fixed rate
 time charter                       1,463        121                 1,584
Operating days under variable
 rate time charter                    163                              163
Operating days under spot
 charter
Utilization                          95.2%      95.6%                 95.2%
Time charter equivalent per
 ship per day - fixed rate tc      23,362   43,851(1)               25,074
Time charter equivalent per
 ship per day - variable rate tc   17,129                           17,129
Time charter equivalent per
 ship per day - spot
Charter in costs per ship per
 day - spot
Net daily revenue per ship per
 day                               20,732     41,930                22,188
Vessel operating expenses per
 ship per day                      (3,732)    (3,501)               (3,716)
Management fees                      (346)                            (322)
Net Operating Cash Flow per
 ship per day before general
 and administrative expenses       16,654     38,429                18,150
                                =========  =========             =========

(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 - This 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 March 6, 2007

                                                              TC
                                        Year     Age    Expiration Date
CURRENT FLEET        Type        DWT    Built  (in yrs) (minimum period)

Iron Lindrew(A)     Kamsarmax   82,300   2007    0.0      December 2010
Iron Knight(A)      Panamax     76,429   2004    2.7      December 2010
Coal Hunter(A)      Kamsarmax   82,300   2006    0.2      December 2010
Pascha(A)           Kamsarmax   82,300   2006    0.2      December 2010
Coal Gypsy(A)       Kamsarmax   82,300   2006    0.3      December 2010
Iron Anne(A)        Kamsarmax   82,000   2006    0.4      December 2010
Iron Vassilis(A)    Kamsarmax   82,000   2006    0.6      December 2010
Iron Bill(A)        Kamsarmax   82,000   2006    0.8      December 2010
Santa Barbara(A)    Kamsarmax   82,266   2006    0.9      December 2010
Ore Hansa(A)        Kamsarmax   82,229   2006    1.0      December 2010
Iron Kalypso(A)     Kamsarmax   82,204   2006    1.1      December 2010
Iron Fuzeyya(A)     Kamsarmax   82,229   2006    1.1      December 2010
Iron Bradyn(A)      Kamsarmax   82,769   2005    2.1      December 2010
Grain Harvester(A)  Panamax     76,417   2004    2.5      July 2009
Grain Express(A)    Panamax     76,466   2004    2.9      December 2010
Kirmar(B)(E)        Capesize   165,500   2001    5.4      March 2008
Iron Beauty(B)      Capesize   165,500   2001    5.6      April 2010
Coal Pride          Panamax     72,600   1999    7.3      February 2009
                    ---------  -------   ----  -----      --------------
Iron Man(C)         Panamax     72,861   1997    9.7      March 2010
Coal Age(C)         Panamax     72,861   1997    9.7      September 2007
Fearless 1(C)       Panamax     73,427   1997    9.9      March 2008
Barbara(D)          Panamax     73,390   1997   10.1      July 2007
Linda Leah(D)       Panamax     73,390   1997   10.1      February 2008
King Coal           Panamax     72,873   1997   10.2      March 2008
Coal Glory(C)       Panamax     73,670   1995   12.0      June 2008

Total Current      25                            4.2
 Fleet            Vessels    2,132,281         years
                                              avg (F)
                 ---------   ---------        -------  ---------------

FLEET TO BE                                Year    Age (in    Delivery
 DELIVERED        Type           DWT       Built    years)     Range

Iron Brooke      Kamsarmax      82,300        *                Mar 07
Iron Miner       Capesize      177,000        *                Mar 07
Lowlands Beilun  Capesize      170,162     1999       7.9      Mar 07
Iron Manolis     Kamsarmax      82,300        *                April 07

Total Fleet to
 be Delivered    4 Vessels     511,762
                                              3.9
                                            years
TOTAL FLEET      29 Vessels  2,644,043     avg (F)
                 ----------  ---------     -------  -----   ---------
* Under Construction

(A), (B), (C) and (D) indicate sister ships. As of March 6, 2007, Quintana had four 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.

(E) Kirmar's charterer has elected to keep the vessel for its maximum initial contracted period until September 2007. In addition, the charterer has exercised an option to extend the charter by up to six months, until early March 2008, at $27,250 per day.

(F) On a dwt weighted average.

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