d1275105_8-k.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 14, 2012


Eagle Bulk Shipping Inc.
(Exact name of registrant as specified in its charter)
 
Republic of the Marshall Islands
001-33831
98-0453513
(State or other jurisdiction of incorporation or organization)
(Commission File Number)
(IRS employer identification no.)
     
477 Madison Avenue
New York, New York
 
10022
(Address of principal executive offices)
 
(Zip Code)

(Registrant's telephone number, including area code): (212) 785-2500
 
(Former Name or Former Address, if Changed Since Last Report): None
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
 
[_]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
[_]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
[_]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   
[_]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))



 
 

 

Item 2.02.                      Results of Operations and Financial Condition

On March 14, 2012, Eagle Bulk Shipping Inc. (the "Company") issued a press release (the "Press Release") relating to its financial results for the fourth quarter and fiscal year ended December 31, 2011.

In accordance with General Instruction B.2 to the Form 8-K, the information under this Item 2.02 and the Press Release, attached hereto as Exhibit 99.1, shall be deemed to be "furnished" to the Securities and Exchange Commission (the "SEC") and not be deemed to be "filed" with the SEC for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section.
 
Item 8.01.                      Other Events

On March 15, 2012, the Company posted on its website, www.eagleships.com, under the section entitled "Investors - Webcasts & Presentations" a presentation dated March 15, 2012 of its financial results for the full year and fourth quarter ended December 31, 2011. A copy of the presentation is hereby furnished to the SEC and is attached as Exhibit 99.2.
 
Item 9.01.                      Financial Statements and Exhibits

(d)           Exhibits

Exhibit Number
Description
 
 
99.1
Press Release dated March 14, 2012.
99.2  Financial Presentation dated March 15, 2012. 

 

 
 

 


 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 

 
 
EAGLE BULK SHIPPING INC.
 
(registrant)
   
Dated: March 19, 2012
By:
  /s/ Alan S. Ginsberg
 
Name:
Alan S. Ginsberg
 
Title:
Chief Financial Officer

 

 

 
 

 

EXHIBIT INDEX

Exhibit No.
Description
 
99.1
99.2
 
Press Release dated March 14, 2012.
Financial Presentation dated March 15, 2012. 



 
 

 



Press Release
Exhibit 99.1

Eagle Bulk Shipping Inc. Reports Fourth Quarter and Fiscal Year 2011 Results


NEW YORK, NY, March 14, 2012-- Eagle Bulk Shipping Inc. (Nasdaq: EGLE) today announced its results for the fourth quarter and fiscal year ended December 31, 2011. 

For the Fourth Quarter:

 
·
Net reported loss of $1.7 million or $0.03 per share (based on a weighted average of 62,700,719 diluted shares outstanding for the quarter), compared to net income of $3.03 million, or $0.05 per share, for the comparable quarter in 2010.
 
·
Net revenues of $70.0 million, compared to $72.4 million for the comparable quarter in 2010. Gross time charter and freight revenues of $71.7 million, compared to time charter revenues of $75.6 million for the comparable quarter in 2010.
 
·
EBITDA, as adjusted for exceptional items under the terms of the Company's credit agreement, was $30.0 million for the fourth quarter of 2011, compared with $32.9 million for the fourth quarter of 2010.
 
·
Fleet utilization rate of 99.7%.
 
·
Took delivery of the Sandpiper Bulker, the last vessel of our newbuilding program.

For the Fiscal Year 2011:

 
·
Net reported loss of $14.8 million or $.24 per share (based on a weighted average of 62,621,771 diluted shares outstanding for the year), compared to net income of $26.8 million, or $0.43 per share, for the comparable fiscal year in 2010.
 
·
Net revenues of $313.4 million, an increase of 18% compared to $265.0 million for the comparable year in 2010. Gross time charter and freight revenues increased 18% to $327.2 million, compared to gross time charter and freight revenues of $278.5 million for the comparable year in 2010.
 
·
EBITDA, as adjusted for exceptional items under the terms of the Company's credit agreement, was $108.9 million for the year of 2011, compared with $148.7 million for the year of 2010.
 
·
Fleet utilization rate of 99.4%.
 
·
Took delivery of eight newbuilding vessels and sold the Heron, 2001-built Supramax.

Sophocles N. Zoullas, Chairman and CEO, commented, "With the completion of our newbuilding program in 2011, Eagle Bulk now operates a fleet of 45 homogenous vessels with an average age of 4.8 years. We believe our Supramax vessels will continue to demonstrate resilience through their optimal size, diversified cargo mix, onboard cranes, and general supply/demand fundamentals as compared to other asset classes.
 
"We are realistic about the year ahead.  Newbuilding deliveries flooded the market in January, and while demand is steady, it is insufficient at this point to meet unfavorable supply dynamics.  Our singular focus in this environment is to continue our record of operational and commercial excellence while working towards a satisfactory agreement with our lenders.  We will update the market accordingly going forward."


 
 

 


Results of Operations for the three-month period ended December 31, 2011 and 2010

For the fourth quarter of 2011, the Company reported a net loss of $1,698,979 or $0.03 per share, based on a weighted average of 62,700,719 diluted shares outstanding. In the comparable fourth quarter of 2010, the Company reported net income of $3,032,942 or $0.05 per share, based on a weighted average of 62,629,178 diluted shares outstanding.

The Company's revenues were earned from time and voyage charters. Gross revenues in the quarter ended December 31, 2011 were $71,704,158, a decrease of 5% from $75,641,650 recorded in the comparable quarter in 2010. The decrease in gross revenues is attributable to lower charter rates offset by operation of a larger fleet. Gross revenues recorded in the quarter ended December 31, 2011 and 2010, include an amount of $1,254,697 and $1,330,202, respectively, relating to the non-cash amortization of fair value below contract value of time charters acquired. Brokerage commissions incurred on revenues earned in the quarter ended December 31, 2011 and 2010 were $1,693,259 and $3,287,732, respectively. Net revenues during the quarter ended December 31, 2011, decreased 3% to $70,010,899 from $72,353,918 in the comparable quarter in 2010.

Total operating expenses for the quarter ended December 31, 2011 were $60,857,843 compared with $57,502,627 recorded in the fourth quarter of 2010. The Company operated 45 vessels in the fourth quarter of 2011 compared with 38 vessels in the corresponding quarter in 2010. The increase in operating expenses was primarily due to increase in operating a larger fleet size which includes increases in vessels crew cost and vessel depreciation expense.

EBITDA, adjusted for exceptional items under the terms of the Company's credit agreement, decreased to $29,989,681 for the fourth quarter of 2011, compared with $32,925,831 for the fourth quarter of 2010. (Please see below for a reconciliation of EBITDA to net income/loss).

Results of Operations for the twelve-month period ended December 31, 2011 and 2010

For the twelve months ended December 31, 2011, the Company reported net loss of $14,819,749 or $0.24 per share, based on a weighted average of 62,621,771 diluted shares outstanding. In the comparable period of 2010, the Company reported net income of $26,844,650 or $0.43 per share, based on a weighted average of 62,417,247 diluted shares outstanding.

The Company's revenues were earned from time and voyage charters. Gross revenues for the twelve-month period ended December 31, 2011 were $327,210,063, an increase of 18% from $278,476,584 recorded in the comparable period in 2010. The increase in gross revenues is attributable to operation of a larger fleet as reflected by the increased operating days, offset by lower charter rates earned. Gross revenues recorded in the twelve-month period ended December 31, 2011 and 2010, include an amount of $5,088,268 and $4,754,407, respectively, relating to the non-cash amortization of fair value below contract value of time charters acquired. Brokerage commissions incurred on revenues earned in the twelve-month periods ended December 31, 2011 and 2010 were $13,777,632 and $13,440,518, respectively. Net revenues during the twelve-month period ended December 31, 2011, increased 18% to $313,432,431 from $265,036,066 in the comparable period in 2010.

Total operating expenses were $281,764,140 in the twelve-month period ended December 31, 2011 compared to $189,376,882 recorded in the same period of 2010. The increase in operating expenses was primarily due to increase in voyage expenses, charter hire expenses and operating a larger fleet size which includes increases in vessels crew cost, insurance cost and vessel depreciation expense.

EBITDA, adjusted for exceptional items under the terms of the Company's credit agreement, decreased by 27% to $108,853,142 for the twelve months ended December 31, 2011 from $148,663,208 for the same period in 2010. (Please see below for a reconciliation of EBITDA to net income/loss).

 
 

 


Legal Proceedings

We evaluated the KLC matter to make a determination as to the impact, if any, on our business, liquidity, results of operations, financial condition and cash flows, and recorded an initial allowance for bad debt in the first quarter of 2011 of $6,586,900, which was updated in the fourth quarter of 2011 to reflect the settlement on November 24, 2011. Accordingly, we adjusted the allowance to $1,811,320, which reflects our recovery of $1,269,070 and write off of $3,506,510. As of December 31, 2011, KLC is not performing in accordance with the $17,000 per vessel per day shortfall arrangement and KLC owes us approximately $4.9 million relating to fourth quarter activities. That revenue does not meet our revenue recognition policy and is not included in our financial statements. We will recognize that revenue and any future revenue from KLC when collectability is assured.

Liquidity and Capital Resources

Net cash provided by operating activities during the years ended December 31, 2011 and 2010 was $58,296,117 and $94,339,830, respectively. The change in 2011 and 2010 was primarily due to lower rates on time charter renewals offset by cash generated from operation of the fleet for 17,514 days in 2011, compared to 13,274 operating days in 2010.

Net cash used in investing activities during the twelve-month period ended December 31, 2011, was $157,786,210, compared to $280,995,791 during the corresponding twelve-month period ended December 31, 2010. Investing activities during the twelve-month period ended December 31, 2011 and 2010 related primarily to making progress payments and incurring related vessel construction expenses for the newbuilding vessels, of which eight and twelve delivered during the first twelve months of 2011 and 2010, respectively.

Net cash used in financing activities in 2011 was $4,556,384, compared to net cash provided by of $244,432,868 in 2010. In 2011, we repaid $21,875,735 toward our revolving facility, and as part of our sixth amendatory and commercial framework agreement with our lenders we reduced our restricted cash by $19,000,000. In 2010 we borrowed $251,183,596 from our revolving credit facility which was used to partly fund advances for construction of newbuilding vessels, twelve of which, Golden Eagle, Imperial Eagle, Thrasher, Crane, Egret Bulker, Avocet, Gannet Bulker, Grebe Bulker, Ibis Bulker, Jay, Kingfisher and Martin delivered during the year.

As of December 31, 2011, our cash balance was $25,075,203 compared to a cash balance of $129,121,680 at December 31, 2010. In addition, our restricted cash balance includes $276,056, for collateralizing letters of credit relating to our office leases and $394,362 which collateralize our derivatives positions as of December 31, 2011.

At December 31, 2011, the Company's debt consisted of $1,129,478,741 in net borrowings under the amended Revolving Credit Facility, which funded the Company's newbuilding program.

On September 26, 2011, we entered into the Sixth Amendatory and Commercial Framework Implementation Agreement (the "Sixth Amendment") to the Third Amended and Restated Credit Agreement dated October 19, 2007, most of the provisions of this Sixth Amendment, unless amended, expire on April 30, 2012. Among other provisions, the Sixth Amendment suspends the Company's compliance with the Minimum Adjusted Net Worth covenant until April 30, 2012 for accounting periods ended March 31, 2011, June 30, 2011, September 30, 2011, and December 31, 2011, and suspends compliance with the Minimum Liquidity covenant until January 30, 2012. From January 31, 2012 until March 30, 2012, the Minimum Liquidity covenant is reduced to $500,000 multiplied by the number of vessels owned and from March 31 until April 29, 2012 the Company is required to maintain cash and cash equivalents in the amount of $27,000,000 and at April 30, 2012 in the amount of $36,000,000. Until April 30, 2012, the calculation of Minimum Liquidity covenant includes undrawn facility amounts as cash and cash equivalents. As of December 31, 2011 the undrawn amount is $21,875,735. In addition to the Minimum Liquidity covenant, the Sixth Amendment requires the Company to obtain the lenders' consent for additional vessel dispositions during the commercial framework period, and to make reasonable efforts to meet certain reporting requirements to the lenders.  The Company was in compliance with all of the covenants related to this Sixth Amendment as of December 31, 2011 and expects to be in compliance through all covenants in effect in 2012 through the April 30, 2012 expiration of the Sixth Amendment.

 
 

 


At the end of the commercial framework period we will provide to our lenders the compliance certificates for the deferred periods. As described in note 6, on August 4, 2009, we entered into a third amendatory agreement to our revolving credit facility. Among other things, the third amendatory agreement reduced the facility to $1.2 billion and changed the applicable interest rate to 2.5% over LIBOR. In addition, among other changes, the third amendatory agreement amended the facility's net worth covenant from a market value to book value measurement with respect to the value of our fleet and reduced the facility's EBITDA to interest coverage ratio, with these changes to stay in effect until we were in compliance with the facility's original covenants for two consecutive accounting periods. Based on information which we provided in 2010 to the lenders under the revolving credit facility, the agent for the lenders notified us that according to its interpretation we were in compliance with the original covenants for the second and third quarters during 2010, and, therefore, our original collateral covenants have been reinstated. We disagree with the interpretation of the original covenant calculation being used by the agent and have advised the agent that we were not in compliance with the original covenants for these two consecutive quarters, and, therefore, the amended collateral covenants should remain in place. Under the agent's interpretation of the covenant, we were in compliance both with the original collateral covenants and the amended collateral covenants during the accounting period ended December 31, 2010. We have remained in compliance with the amended collateral covenants during the accounting periods ended March 31, 2011, June 30, 2011, September 30, 2011, and December 31, 2011, but would not have been in compliance for these periods under the agent's interpretation of the original collateral covenants. We believe that our interpretation of the facility agreement's covenant calculation is correct, that the reinstatement of the original loan covenant has not occurred, and that we remain in compliance with all covenants in effect at December 31, 2011. However, if the agent's interpretation is determined to be correct, we would not be in compliance with the original covenants for the periods ending March 31, 2011, June 30, 2011, September 30, 2011, and December 31, 2011, which would constitute a default under the facility agreement and would result in the classification as current of the amounts due under the facility agreement and would lead to substantial doubt about our ability to continue as a going concern, if we are unable to agree on satisfactory alternative terms or obtain a waiver from the lenders. We are in discussions with our lenders as part of the Sixth Amendment to either amend the facility's amortization schedule or the covenants then in effect. Although there is no assurance that we will be successful in doing so, we continue to seek a satisfactory agreement with our lenders.

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 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 here may not be comparable to that used by other companies due to differences in methods of calculation.

 
 

 


The following table is a reconciliation of net income, as reflected in the consolidated statements of operations, to the Credit Agreement EBITDA:

   
Three Months Ended
   
Twelve Months Ended
 
   
December 31, 2011
   
December 31, 2010
   
December 31, 2011
   
December 31, 2010
 
                                 
Net income (loss)
 
$
(1,698,979)
   
$
3,032,942
   
$
(14,819,749)
   
$
26,844,650
 
Interest expense
   
11,370,603
     
11,668,048
     
46,769,965
     
48,885,674
 
Depreciation and amortization
   
19,624,596
     
16,508,187
     
73,084,105
     
62,945,478
 
Amortization of fair value below contract value of time charter acquired
   
(1,254,697
)
   
(1,330,202
)
   
(5,088,268
)
   
(4,754,407
)
EBITDA
   
28,041,523
     
29,878,975
     
99,946,053
     
133,921,395
 
Adjustments for exceptional items:
                               
Non-cash compensation expense (1)
   
1,948,158
     
3,046,856
     
8,907,089
     
14,741,813
 
Credit agreement EBITDA
 
$
29,989,681
   
$
32,925,831
   
$
108,853,142
   
$
148,663,208
 

(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.

We make capital expenditures from time to time in connection with our vessel acquisitions. As of December 31, 2011, our fleet consisted of 43 Supramax and 2 Handymax vessels.

In addition to acquisitions that we may undertake in future periods, the Company's other major capital expenditures include funding the Company's program of regularly scheduled drydocking necessary 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. In 2011, four of our vessels were drydocked and we incurred $2,809,406 in drydocking related costs. In 2010, five of our vessels were drydocked and we incurred $2,827,534 in drydocking related costs. In 2009, eight of our vessels were drydocked and we incurred $4,477,244 in drydocking related costs. 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)
 
March 31, 2012
    30    
$0.75 million
 
June 30, 2012
    -       -  
September 30, 2012
    15    
$0.35 million
 
December 31, 2012
    22    
$0.55 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 STATEMENT OF OPERATIONS
 
   
Three Months Ended (unaudited)
   
Twelve Months Ended
 
   
December 31, 2011
   
December 31, 2010
   
December 31, 2011
   
December 31, 2010
 
Revenues, net of commissions
  $ 70,010,899     $ 72,353,918     $ 313,432,431     $ 265,036,066  
                                 
Voyage expenses
    8,403,814       2,288,326       44,345,774       3,726,847  
Vessel expenses
    22,285,822       22,492,719       85,049,671       72,983,630  
Charter hire expenses
    3,202,586       7,144,697       41,215,875       9,982,677  
Depreciation and amortization
    19,624,596       16,508,187       73,084,105       62,945,478  
General and administrative expenses
    7,341,025       9,068,698       37,559,639       40,029,261  
Loss (gain) from sale of vessel
    -    
­­­­-
      509,076       (291,011 )
    Total operating expenses
    60,857,843       57,502,627       281,764,140       189,376,882  
                                 
Operating income
    9,153,056       14,851,291       31,668,291       75,659,184  
                                 
Interest expense
    11,370,603       11,668,048       46,769,965       48,885,674  
Interest income
    (7,077 )     (148,117 )     (130,007 )     (369,558 )
Other (income) expense
    (511,491 )     298,418       (151,918 )     298,418  
    Total other expense, net
    10,852,035       11,818,349       46,488,040       48,814,534  
                                 
Net income (loss)
  $ (1,698,979 )   $ 3,032,942     $ (14,819,749 )   $ 26,844,650  
                                 
Weighted average shares outstanding :
                               
                                 
Basic
    62,700,719       62,325,549       62,621,771       62,204,443  
Diluted
    62,700,719       62,629,178       62,621,771       62,417,247  
                                 
Per share amounts:
                               
Basic net income (loss)
  $ (0.03 )   $ 0.05     $ (0.24 )   $ 0.43  
 
 
Fleet Operating Data

   
Three Months Ended
   
Twelve Months Ended
 
   
December 31, 2011
   
December 31, 2010
   
December 31, 2011
   
December 31, 2010
 
Ownership Days
    4,122       3,496       15,290       12,958  
Chartered-in under operating lease Days
    182       336       2,421       426  
Available Days
    4,283       3,802       17,619       13,323  
Operating Days
    4,272       3,794       17,514       13,274  
Fleet Utilization
    99.7 %     99.8 %     99.4 %     99.6 %


 
 

 


CONSOLIDATED BALANCE SHEETS
   
December 31,
 
   
2011
   
2010
 
ASSETS:
           
Current assets:
           
Cash and cash equivalents
  $ 25,075,203     $ 129,121,680  
Accounts receivable
    13,960,777       14,366,495  
Prepaid expenses
    3,969,905       3,459,721  
Inventories
    11,083,331       3,190,052  
Investment
    988,196        
Fair value above contract value of time charters acquired
    567,315       594,611  
Fair value of derivative instruments
    246,110        
                 
       Total current assets
    55,890,837       150,732,559  
Noncurrent assets:
               
Vessels and vessel improvements, at cost, net of accumulated
       depreciation of $239,568,767 and $176,824,438, respectively
    1,789,381,046       1,509,798,249  
Advances for vessel construction
          191,477,225  
Other fixed assets, net of accumulated amortization of $324,691
       and $153,375, respectively
    605,519       420,204  
Restricted cash
    670,418       19,790,341  
Deferred drydock costs
    3,303,363       4,217,071  
Deferred financing costs
    11,766,779       16,458,496  
Fair value above contract value of time charters acquired
    3,041,496       3,608,812  
Other assets, net
    2,597,270       70,001  
       Total noncurrent assets
    1,811,365,891       1,745,840,399  
                 
Total assets
  $ 1,867,256,728     $ 1,896,572,958  
                 
LIABILITIES & STOCKHOLDERS' EQUITY
               
Current liabilities:
               
Accounts payable
  $ 10,642,831     $ 6,089,273  
Accrued interest
    2,815,665       6,651,554  
Other accrued liabilities
    11,822,582       5,850,474  
Current portion of long-term debt
    32,094,006        
Deferred revenue and fair value below contract value of time charters
        Acquired
    5,966,698       5,705,326  
Unearned charter hire revenue
    5,779,928       6,091,332  
Fair value of derivative instruments
          127,758  
                 
       Total current liabilities
    69,121,710       30,515,717  
Noncurrent liabilities:
               
Long-term debt
    1,097,384,735       1,151,354,476  
Deferred revenue and fair value below contract value of time charters
  Acquired
    17,088,464       23,480,740  
Fair value of derivative instruments
    9,486,116       22,135,507  
                 
       Total noncurrent liabilities
    1,123,959,315       1,196,970,723  
Total liabilities
    1,193,081,025       1,227,486,440  
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, 63,003,286 and
         62,126,665 shares issued and outstanding, respectively
    630,033       625,604  
Additional paid-in capital
    745,473,169       738,251,158  
Retained earnings (net of dividends declared of $262,118,388 as of
        December 31, 2011 and 2010, respectively)
    (62,474,486 )     (47,654,737 )
Accumulated other comprehensive loss
    (9,453,013 )     (22,135,507 )
                 
       Total stockholders' equity
    674,175,703       669,086,518  
                 
Total liabilities and stockholders' equity
  $ 1,867,256,728     $ 1,896,572,958  


 
 

 


CONSOLIDATED STATEMENTS OF CASH FLOWS:

   
Year Ended December 31,
 
   
2011
   
2010
   
2009
 
Cash flows from operating activities
                 
Net income (loss)
  $ (14,819,749 )   $ 26,844,650     $ 33,287,271  
Adjustments to reconcile net income/(loss) to net cash provided by operating activities:
                       
Items included in net income not affecting cash flows:
                       
Depreciation and amortization
    69,887,121       59,503,895       41,380,917  
Amortization of deferred drydocking costs
    3,196,984       3,441,583       2,948,341  
Amortization of deferred financing costs
    4,172,604       3,202,455       1,373,998  
Write-off of deferred financing costs
                3,383,289  
Amortization of fair value (below) above contract value of time charter acquired
    (5,088,268 )     (4,754,407 )     (2,643,820 )
Loss (gain) on sale of vessel
    509,076       (291,011 )      
Unrealized (gain) loss on derivatives, net
    (373,868 )     127,758        
Allowance for accounts receivable
    1,811,320              
Non-cash compensation expense
    8,907,089       14,741,813       13,977,974  
Changes in operating assets and liabilities:
                       
Accounts receivable
    (1,405,602 )     (6,923,045 )     (3,085,613 )
Prepaid expenses
    (510,184 )     1,529,725       (1,691,645 )
Inventories
    (7,893,279 )     (3,190,052 )      
Other assets
    (2,527,269 )     (70,001 )      
Accounts payable
    4,553,558       3,799,940       252,273  
Accrued interest
    (4,526,690 )     (4,211,361 )     1,429,939  
Accrued expenses
    5,972,108       2,022,756       805,743  
Drydocking expenditures
    (2,809,406 )     (2,827,534 )     (4,477,244 )
Deferred revenue
    (448,024 )     159,467       4,684,138  
Unearned charter hire revenue
    (311,404 )     1,233,199       (1,100,700 )
                         
Net cash provided by operating activities
    58,296,117       94,339,830       90,524,861  
Cash flows from investing activities:
                       
Vessels and vessel improvements and Advances for vessel construction
    (179,105,635 )     (301,795,862 )     (228,530,198 )
Purchase of other fixed assets
    (356,631 )     (255,713 )     (94,065 )
Proceeds from sale of vessel
    22,511,226       21,055,784        
Investment
    (955,093 )            
Changes in restricted cash
    119,923              
                         
Net cash used in investing activities
    (157,786,210 )     (280,995,791 )     (228,624,263 )
Cash flows from financing activities
                       
Issuance of common stock
                99,999,997  
Equity issuance costs
                (2,708,951 )
Bank borrowings
          251,183,596       159,215,000  
Repayment of debt
    (21,875,735 )           (48,645,523 )
Changes in restricted cash
    19,000,000       (6,014,285 )     (2,000,000 )
Deferred financing costs
                (4,515,623 )
Cash used to settle net share equity awards
    (1,680,649 )     (736,443 )     (1,109,587 )
                         
Net cash provided by (used in) financing activities
    (4,556,384 )     244,432,868       200,235,313  
Net increase/(decrease) in Cash
    (104,046,477 )     57,776,907       62,135,911  
Cash at beginning of period
    129,121,680       71,344,773       9,208,862  
                         
Cash at end of period
  $ 25,075,203     $ 129,121,680     $ 71,344,773  
                         
Supplemental cash flow information:
                       
Cash paid during the period for Interest (including capitalized interest and commitment fees of  $3,200,486, $13,725,858 and $26,643,519 in 2011, 2010 and 2009, respectively)
  $ 48,498,289     $ 57,480,100     $ 52,760,344  


 
 

 


The following table represents certain information about our revenue earning charters on our operating fleet as of December 31, 2011:

 
Vessel
Year Built
 
Dwt
 
 
Charter Expiration (1)
  Daily Charter Hire Rate
Avocet (2)
2010
    53,462  
 
Jan 2012
  $ 8,050(3)  
Bittern (2)
2009
    57,809  
Feb 2012
  $ 13,500(3)  
Canary (2)
2009
    57,809  
Jan 2012
  $ 15,500(3)  
Cardinal
2004
    55,362  
Dec 2012 to Feb 2013
 
Index (4)
 
Condor
2001
    50,296  
Jan 2012 to Mar 2012
  $ 15,250  
Crane (2)
2010
    57,809  
Feb 2012
Voyage(3)
Crested Eagle
2009
    55,989  
Jan 2012
  $ 13,300(3)  
Crowned Eagle
2008
    55,940  
Aug 2012 to Oct 2012
  $ 14,000  
Egret Bulker
2010
    57,809  
Oct 2012 to Feb 2013
  $ 17,650(5)
(with 50% profit share over $20,000)
Falcon
2001
    50,296  
Jan 2012 to Mar 2012
  $ 14,000  
Gannet Bulker
2010
    57,809  
Jan 2013 to May 2013
  $ 17,650(5)
(with 50% profit share over $20,000)
Golden Eagle
2010
    55,989  
Mar 2012
  $ 15,750  
Goldeneye
2002
    52,421  
Oct 2012 to Jan 2013
 
Index(4)
 
Grebe Bulker
2010
    57,809  
Feb 2013 to Jun 2013
  $17,650(5)
(with 50% profit share over $20,000)
Harrier
2001
    50,296  
Feb 2012
  $ 15,000(3)  
Hawk I
2001
    50,296  
Jan 2012 to Feb 2012
  $ 13,500(3)  
Ibis Bulker
2010
    57,775  
Mar 2013 to Jul 2013
  $17,650(5)
(with 50% profit share over $20,000)
Imperial Eagle
2010
    55,989  
Nov 2012 to Feb 2013
 
Index(4)
 
Jaeger
2004
    52,248  
Nov 2012 to Jan 2013
 
Index(4)
 
Jay(2)
2010
    57,802  
Jan 2012
 
Spot(3)
 

 
 

 


 
Vessel
Year Built
 
Dwt
 
 
Charter Expiration (1)
  Daily Charter Hire Rate
Kestrel I
2004
    50,326  
Aug 2012 to Oct 2012
 
Index(4)
 
Kingfisher (2)
2010
    57,776  
Feb 2012
 
Voyage
 
Kite
1997
    47,195  
Feb 2012 to May 2012
  $ 10,000  
Kittiwake
2002
    53,146  
Jan 2012 to Mar 2012
  $ 14,950(3)  
Martin(2)
2010
    57,809  
Jan 2012
 
Voyage(3)
 
Merlin
2001
    50,296  
Jan 2012 to Mar 2012
  $ 15,625  
Nighthawk(2)
2011
    57,809  
Jan 2012
 
Voyage(3)
 
Oriole(2)
2011
    57,809  
Feb 2012
  $ 26,750(3)  
Osprey I
2002
    50,206  
Jan 2012 to Feb 2012
  $ 14,000(3)  
Owl(2)
2011
    50,809  
Feb 2012 to Apr 2012
 
Voyage(3)
 
Peregrine
2001
    50,913  
Jan 2012
  $ 12,750(3)  
Petrel Bulker
2011
    57,809  
May 2014 to Sep 2014
  $  17,650(5) (with 50%
                profit share over $20,000)
Puffin Bulker
2011
    57,809  
May 2014 to Sep 2014
  $17,650(5) (with 50%
                profit share over $20,000)
Redwing
2007
    53,411  
Jan 2012
  Voyage(3)
Roadrunner Bulker
2011
    57,809  
Aug 2014 to Dec 2014
  $17,650(5) (with 50%
                profit share over $20,000)
Sandpiper Bulker
2011
    57,809  
Aug 2014 to Dec 2014
  $17,650(5) (with 50%
                profit share over $20,000)
Shrike
2003
    53,343  
Jan 2012 to Mar 2012
  $ 14,500  
Skua
2003
    53,350  
Jan 2012 to Apr 2012
  $ 14,500  
Sparrow
2000
    48,225  
Feb 2012
 
Spot(3)
 
Stellar Eagle
2009
    55,989  
Feb 2012 to Apr 2012
  $ 15,100  
Tern
2003
    50,200  
Feb 2012
 
Spot(3)
 
Thrasher (2)
2010
    53,360  
Mar 2012
  $ 13,250(3)  
Thrush
2011
    53,297  
Jan 2012 to Apr 2012
  $ 15,500  
Woodstar (2)
2008
    53,390  
Feb 2012
  $ 15,000(3)  
Wren (2)
2008
    53,349  
Feb 2012
 
Spot(3)
 
 
 
     
 
 (1)
The date range provided represents the earliest and latest date on which the charterer may redeliver the vessel to the Company upon the 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)
The charter rate does not include any shortfall between the vessels' actual daily earnings and the $17,000 per day that KLC is responsible for. Revenue from KLC will be recognized when collectability is assured. In addition, up to December 2015 Eagle is entitled to 100% profit share is between $17,000 to $21,000 and 50% profit share thereafter, from January 2016 to Dec 2018/Apr 2019 with 50% profit share above $17,000.
 
(3)
Upon conclusion of the previous charter the vessel will commence a short term charter for up to six months.
 
(4)
Index, an average of the trailing Baltic Supramax Index.
 
(5)
The charterer has an option to extend the charter by 2 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

As previously announced, members of Eagle Bulk's senior management team will host a teleconference and webcast at Thursday, March 15th, to discuss these results.

To participate in the teleconference, investors and analysts are invited to call 866-730-5770 in the U.S., or 857-350-1594outside of the U.S., and reference participant code 28295256. 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 March 22, 2012. To access the replay, call 888-286-8010in the U.S., or 617-801-6888 outside of the U.S., and reference passcode 40739533.

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

Contact:
     Company Contact:
     Alan Ginsberg
     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

--------------------------------------------------------------------------------
Source: Eagle Bulk Shipping Inc.
 
 
 
 
 

 
 

 
Exhibit 99.2
 
 
EAGLE BULK SHIPPING INC.
4Q 2011 Results Presentation
15 March 2012
 
 

 
EAGLE BULK SHIPPING INC.
2
Forward Looking Statements
This presentation contains certain statements that may be deemed to be “forward-looking statements”
within the meaning of the Securities Acts. Forward-looking statements reflect management’s 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
presentation 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, ability of our counterparties to perform their obligations under
sales agreements, charter contracts, and other agreements on a timely basis, 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.
 
 
 

 
EAGLE BULK SHIPPING INC.
3
§ Results and Highlights
§ Company
§ Industry
§ Financials
§ Q&A
§ Appendix
Agenda
 
 

 
Results and Highlights
 
 

 
EAGLE BULK SHIPPING INC.
2011 Results
5
5
4Q 2011
§ Net reported loss of $1.7 million, or $0.03 per share.
§ Net revenues of $70.0 million.
§ EBITDA* of $30.0 million.
§ Fleet utilization rate of 99.7%.
Full Year 2011
§ Net reported loss of $14.8 million, or $0.24 per share.
§ Net revenues of $313.4 million.
§ EBITDA* of $108.9 million.
§ Fleet utilization rate of 99.4%.
Positive Operating Cash Flow in a Challenging Year for the Industry
*EBITDA, as defined in our Credit Agreement
 
 

 
EAGLE BULK SHIPPING INC.
2011 Highlights
6
6
Strategic
§ Took delivery of final eight Supramaxes completing newbuilding program.
 § Four vessels fixed for three years at $17,650 per day plus profit share.
§ Sold the Heron, a 2001-built Supramax, for $22.5 million, net.
Commercial
§ Thirteen vessels fixed to Korea Line Corporation (“KLC”) affected by
 the charterer’s reorganization in February.
 § Took-back operating control of all thirteen vessels and successfully
 minimized negative cash impact to the Company.
 
 

 
EAGLE BULK SHIPPING INC.
Recent Developments
7
7
Korea Line Corporation Charters
§ Eagle Bulk continues to employ vessels on short-to-medium charters with a
 diversified group of customers.
§ As of December 31, 2011, KLC has not been performing in accordance with
 the $17,000 per vessel per day shortfall arrangement and owes us approximately
 $4.9 million.
 § Short-fall revenue from KLC is recognized when collectability is assured.
Discussions with Lending Group
§ Eagle Bulk continues to operate under certain waivers as outlined in the Sixth
 Amendment to the Credit Facility and remains in ongoing discussions with
 Lending Group on reaching an amendment to its loan.
 
 

 
Company
 
 

 
EAGLE BULK SHIPPING INC.
     
9
Growth Executed
Excellent fleet utilization maintained
13
16
18
23
27
38
45
45
* Estimated fleet cumulative annual growth rate (“CAGR”) between 2005 and 2012
 
 

 
EAGLE BULK SHIPPING INC.
10
Second Largest Supramax Fleet in the World
 
Vessel
DWT
Year
Built
 
Vessel
DWT
Year
Built
 
Vessel
DWT
Year
Built
1
Sandpiper Bulker
57,809
2011
16
Avocet
53,462
2010
31
Kestrel I
50,326
2004
2
Roadrunner Bulker
57,809
2011
17
Thrasher
53,360
2010
32
Skua
53,350
2003
3
Puffin Bulker
57,809
2011
18
Golden Eagle
55,989
2010
33
Shrike
53,343
2003
4
Petrel Bulker
57,809
2011
19
Egret Bulker
57,809
2010
34
Tern
50,200
2003
5
Owl
57,809
2011
20
Crane
57,809
2010
35
Kittiwake
53,146
2002
6
Oriole
57,809
2011
21
Canary
57,809
2009
36
Goldeneye
52,421
2002
7
Nighthawk
57,809
2011
22
Bittern
57,809
2009
37
Osprey I
50,206
2002
8
Thrush
53,297
2011
23
Stellar Eagle
55,989
2009
38
Falcon
50,296
2001
9
Martin
57,809
2010
24
Crested Eagle
55,989
2009
39
Peregrine
50,913
2001
10
Kingfisher
57,776
2010
25
Crowned Eagle
55,940
2008
40
Condor
50,296
2001
11
Jay
57,802
2010
26
Woodstar
53,390
2008
41
Harrier
50,296
2001
12
Ibis Bulker
57,775
2010
27
Wren
53,349
2008
42
Hawk I
50,296
2001
13
Grebe Bulker
57,809
2010
28
Redwing
53,411
2007
43
Merlin
50,296
2001
14
Gannet Bulker
57,809
2010
29
Cardinal
55,362
2004
44
Sparrow
48,225
2000
15
Imperial Eagle
55,989
2010
30
Jaeger
52,248
2004
45
Kite
47,195
1997
* Average age calculated on a DWT-basis 
Modern and homogeneous fleet yields commercial advantage
VESSEL COUNT
45
DWT
2,451,259
AVERAGE AGE*
4.8 yrs
 
 

 
EAGLE BULK SHIPPING INC.
11
Dynamic Approach to Chartering
Focus on trading fleet short-term until market recovers
*KLC charters not included
Full Year 2012 Chartering Profile* (as
of 12/31/11)
 
 

 
EAGLE BULK SHIPPING INC.
12
5.4m Tons Carried in 4Q 2011, +34% Y/Y
Diversified Cargo Mix
Cargo
Type
MT
as a % of Total
1
Iron Ore
Major
 624,680
11.7%
2
Coal
Major
 619,848
11.6%
3
Grains / Agricultural
Major
 405,202
7.6%
4
Sand
Minor
 1,763,035
32.9%
5
Copper Ore
Minor
 601,049
11.2%
6
Cement
Minor
 407,745
7.6%
7
Steels / Pig Iron / Scrap
Minor
 258,368
4.8%
8
Other Ores
Minor
 189,878
3.5%
9
Potash / Fertilizer
Minor
 131,316
2.5%
10
Petcoke
Minor
 101,396
1.9%
11
Metals
Minor
 77,465
1.4%
12
Forest Products
Minor
 68,164
1.3%
13
Alumina/Bauxite
Minor
 55,700
1.0%
14
Sugar
Minor
 47,430
0.9%
TOTAL
 5,351,276
100.0%
 
 

 
Industry
 
 

 
EAGLE BULK SHIPPING INC.
14
Source: Clarksons
2011: Peak Orderbook Deliveries Pressure Rates
Drybulk Demand
(% annual growth measured in MT)
Drybulk Supply
(% annual net growth in DWT)
Average Spot Rates
 
Supramax
Panamax
Capesize
2010
$22,428
$24,984
$33,210
2011
$14,378
$13,952
$15,751
Year-on-Year % Change
-35.9%
-44.2%
-52.6%
Supramax outperforms
 
 

 
EAGLE BULK SHIPPING INC.
15
Source(s): Clarksons, Platou, WSA, WSJ
§ Newbuilding deliveries flood market in January.
 § Over 12m DWT delivered, a record month.
§ Global steel production down 8% Y/Y in January
 to total 117m tons.
 § Timing of Chinese New Year negatively
 affected local production and importing
 activity as the holiday commenced two
 weeks earlier than usual.
Market Weakness Intensifies in 1Q 2012
Bottom reached?
Drybulk Newbuilding Deliveries
(in m DWT)
 
 

 
EAGLE BULK SHIPPING INC.
16
Source(s): Clarksons, Commodore, ICAP, Platou, WSJ
§ Supply growth momentum normalizing-newbuilding
 deliveries plunged in February to 5.3m DWT, -57%
 M/M.
§ Supramax global fleet disbursement correcting.
 § Poor rate environment during January/February
 led to many vessels ballasting (from the Pacific)
 towards the Atlantic for business causing the
 Atlantic-to-Pacific rate ratio to fall to a 5yr low.
§ Pick-up in Indian iron ore exports after reduction in
 railway freight charges.
§ Chinese coal stockpiling trend reversing.
 § February inventories down 16% M/M to reach
 7.4m MT.
 § Planned annual maintenance on the Daqin
 Railway to affect 6m MT of domestic supplies.
§ Supramax forward curve expectations turn positive.
Short-term Dislocations
Supramax Atlantic vs. Pacific Rates
(Atlantic R/V to Pacific R/V Ratio)
Supramax Forward Curve (as
of March 2011 and 2012, respectively)
 
 

 
EAGLE BULK SHIPPING INC.
17
Source(s): Clarksons, ICAP, Platou, WSJ
§ Global GDP growth estimates for 2012 revised down
 to +3.8% (from +5.8%) due to potential recession in
 Euro area and lower growth expectations for emerging
 markets.
§ Strong growth expected in China but revised
 downward to 7.5%.
 § PBOC has lowered deposit reserve ratio twice in
 2012 already adding over $125 billion in liquidity.
 § Demand growth expected to remain firm in 2012.
§ Realized net supply growth dependent on both
 slippage/cancellations and scrapping.
2012 to Remain Challenging Due to Supply Growth
Last year of major supply growth
Chinese Deposit Reserve Ratio
 
 

 
EAGLE BULK SHIPPING INC.
18
Source(s): Clarksons, Macquarie, MAF, and USDA
 § U.S. exports facing increased global
 competition from Former Soviet Union (FSU)
 republics.
§ Chinese minor bulk demand remains robust.
 § Imports totaled 253m MT in 2011, +31% Y/Y.
 § Growth has been driven by forest products,
 bauxite and alumina.
Grain/Agricultural and Minor Bulk Trades Firm
Minor bulks represents 1/3 of total drybulk trade
Top Ten Importers of U.S. Grain Products
 
 

 
EAGLE BULK SHIPPING INC.
Source(s): Clarksons, Macquarie, Peabody
§ African-sourced iron ore to gain market share and
 increase ton-mile demand.
 § Sierra Leone shipped its first cargo ever
 (destined to China) on an Eagle Bulk vessel.
§ Over 350 GW of new coal-fueled power capacity
 to come online globally by 2016:
 § China- 240 GW
 § India- 70 GW
 § Other- 40 GW 
 § Majority of incremental coal required to be
 sourced from Indonesia and Australia.
Strong L/T Fundamentals for Coal and Iron Ore
Indian and Chinese Coal Imports
(in m MT)
 
 

 
EAGLE BULK SHIPPING INC.
20
Source(s): Clarksons, FT
Supply Growth Decreasing
§ Newbuilding deliveries peaking and orderbook
 continues to shrink.
 § New orders in 2011 down 66% Y/Y.
 § Orderbook stands at 32% of the on-the-water
 fleet, -60% since peak in 2008.
 § Slippage/cancellations remain at +35%.
§ Debt financing availability remains tight.
§ Shipyards continue to face pressure on already
 thin/negative margins due to increasing input and
 payroll costs and local currency strength (against
 the USD).
 § Create a (price) floor for newbuildings.
 § Leading to shipyard bankruptcies.
§ Scrapping to remain at records levels.
 § Over 1,600 vessels are over the age of 25.
 § Scrap prices remain at attractive levels.
Drybulk Scrapping
(annual, in m DWT)
Drybulk Fleet Over 25 years of Age
46 vessels
221 vessels
1368 vessels
 
 

 
Financials
 
 

 
EAGLE BULK SHIPPING INC.
22
Earnings (in thousands, except per share data)
Periods ending December 31, 2011
 
3 months
12 months
 
ended
ended
REVENUES, net of commissions
$70,010.9
$313,432.4
EXPENSES
 
 
 
Voyage expenses
 8,403.8
 44,345.8
 
Vessel expenses
 22,285.8
 85,049.6
 
Charter hire expenses
 3,202.6
 41,215.9
 
Depreciation and amortization
 19,624.6
 73,084.1
 
General and administrative expenses
 7,341.0
 37,559.6
 
Loss from sale of vessel
 -
 509.1
 
Total operating expenses
 60,857.8
 281,764.1
OPERATING INCOME
 9,153.1
 31,668.3
OTHER EXPENSES
 
 
 
Interest expense
 11,370.6
 46,770.0
 
Interest income
 (7.1)
 (130.0)
 
Other income
 (511.5)
 (151.9)
 
Total other expense, net
 10,852.0
 46,488.1
NET LOSS
$(1,698.9)
$(14,819.8)
EBITDA
 29,989.7
 108,853.1
EPS (Basic and Diluted)
$(0.03)
$(0.24)
Weighted average shares outstanding
 
 
 
Basic and Diluted
62,700,719
62,621,771
 
 

 
EAGLE BULK SHIPPING INC.
23
Balance Sheet (in thousands)
As of December 31, 2011
 
 
 
 
 
Cash and Restricted Cash
$25,745.6
Other Current Assets
 30,815.6
Vessels, net
 1,789,381.0
Advances for vessel construction
 -
Noncurrent Assets
 21,314.5
Total Assets
$1,867,256.7
Current Liabilities
 37,027.7
Current Portion of Long-term Debt
 
 32,094.0
Long-term Debt
 1,097,384.7
Noncurrent Liabilities
 26,574.6
Stockholder's Equity
$674,175.7
Total Liabilities and Stockholder's Equity
$1,867,256.7
 
 

 
EAGLE BULK SHIPPING INC.
24
2012 Estimated Daily Cash Expense Breakeven
Expense breakdown*
Vessel Opex
$5,103
Technical Management
319
G&A
1,214
Interest
2,728
Drydocking
100
Total
$9,464
*ASSUMPTIONS:
§ Vessel expenses are comprised of the following: crew wages and related, insurance, repair and maintenance, stores, spares and related inventory, and
 tonnage taxes.
§ Interest expense takes into consideration Eagle Bulk’s view and projection of LIBOR rates.
§ Drydocking expense is based on estimated costs for anticipated vessel drydockings in the next four quarters.
 
 

 
Q&A
 
 

 
 
 

 
Appendix
 
 

 
EAGLE BULK SHIPPING INC.
28
Charter Summary (as of December 31, 2011)
 
Vessel
Charter Expiry
Charter
Base
Rate
 
Vessel
Charter Expiry
Charter
Base
Rate
 
Vessel
Charter Expiry
Charter
Base
Rate
Earliest
Latest
Earliest
Latest
Earliest
Latest
1
Sandpiper Bulker
8/2014
12/2014
$17,650
16
Avocet
1/2012
1/2012
$8,050
31
Kestrel I
8/2012
10/2012
BSI*
2
Roadrunner Bulker
8/2014
12/2014
$17,650
17
Thrasher
3/2012
3/2012
$13,250
32
Skua
1/2012
4/2012
$14,500
3
Puffin Bulker
5/2014
9/2014
$17,750
18
Golden Eagle
3/2012
3/2012
$15,750
33
Shrike
1/2012
3/2012
$14,500
4
Petrel Bulker
5/2014
9/2014
$17,650
19
Egret Bulker
10/2012
2/2013
$17,650
34
Tern
2/2012
2/2012
spot
5
Owl
2/2012
4/2012
voyage
20
Crane
2/2012
2/2012
voyage
35
Kittiwake
1/2012
3/2012
$14,950
6
Oriole
2/2012
2/2012
$26,750
21
Canary
1/2012
1/2012
$15,500
36
Goldeneye
10/2012
1/2013
BSI*
7
Nighthawk
1/2012
1/2012
voyage
22
Bittern
2/2012
2/2012
$13,500
37
Osprey I
1/2012
2/2012
$14,000
8
Thrush
1/2012
4/2012
$15,500
23
Stellar Eagle
2/2012
4/2012
$15,100
38
Falcon
1/2012
3/2012
$14,000
9
Martin
1/2012
1/2012
voyage
24
Crested Eagle
1/2012
1/2012
$13,300
39
Peregrine
1/2012
1/2012
$12,650
10
Kingfisher
2/2012
2/2012
voyage
25
Crowned Eagle
8/2012
10/2012
$14,000
40
Condor
1/2012
3/2012
$15,250
11
Jay
1/2012
1/2012
spot
26
Woodstar
2/2012
2/2012
$15,000
41
Harrier
2/2012
2/2012
$15,000
12
Ibis Bulker
3/2013
7/2013
$17,650
27
Wren
2/2012
2/2012
spot
42
Hawk I
1/2012
2/2012
$13,500
13
Grebe Bulker
2/2013
6/2013
$17,650
28
Redwing
1/2012
1/2012
voyage
43
Merlin
1/2012
3/2012
$15,625
14
Gannet Bulker
1/2013
5/2013
$17,650
29
Cardinal
12/2012
2/2013
BSI*
44
Sparrow
2/2012
2/2012
spot
15
Imperial Eagle
11/2012
2/2013
BSI*
30
Jaeger
11/2012
1/2013
BSI*
45
Kite
2/2012
5/2012
$10,000
*BSI= Baltic Supramax Index