Three Months Ended September 30, 2006 ============================================== PANAMAX CAPESIZE CHARTER IN TOTAL ========== ========== ========== ========== Total Ownership days 988 184 55 1,227 Operating days under fixed rate time charter 893 178 1,071 Operating days under variable rate time charter 91 91 Operating days under spot charter 55 55 Utilization 99.6% 96,9% 100% 99,2% Time charter equivalent per ship per day fixed rate tc $19,784 $30,964 $21,645 Time charter equivalent per ship per day variable rate tc $25,221 $25,221 Time charter equivalent per ship per day spot $10,771 $10,771 Charter in costs per ship per day - spot $(14,489) $(14,489) Net daily revenue per ship per day $19,298 $28,708 $(4,283) $19,652 Vessel operating expenses per ship per day $(3,401) $(3,786) $(3,461) Management fees Net Operating Cash Flow per ship per day before general and administrative expenses $15,897 $24,922 $(4,283) $16,191 ========== ========== ========== ========== Three Months Ended September 30, 2005 ============================================== PANAMAX CAPESIZE CHARTER IN TOTAL ========== ========== ========== ========== Total Ownership days 619 619 Operating days under fixed rate time charter 540 540 Operating days under variable rate time charter 73 73 Operating days under spot charter Utilization 99% 99% Time charter equivalent per ship per day fixed rate tc $23,177 $23,177 Time charter equivalent per ship per day variable rate tc $14,068 $14,068 Time charter equivalent per ship per day spot Charter in costs per ship per day - spot Net daily revenue per ship per day $20,991 $20,991 Vessel operating expenses per ship per day $(3,774) $(3,774) Management fees $(766) $(766) Net Operating Cash Flow per ship per day before general and administrative expenses $16,451 $16,451 ========== ========== Nine Months Ended September 30, 2006 ============================================== PANAMAX CAPESIZE CHARTER IN TOTAL ========== ========== ========== ========== Total Ownership days 2,436 546 139 3,121 Operating days under fixed rate time charter 2,151 526 2,677 Operating days under variable rate time charter 272 272 Operating days under spot charter 139 139 Utilization 99.5% 96.3% 100% 98.9% Time charter equivalent per ship per day fixed rate tc $20,500 $32,314 $22,820 Time charter equivalent per ship per day variable rate tc $19,696 $19,696 Time charter equivalent per ship per day spot $20,695 $20,695 Charter in costs per ship per day - spot $(17,771) $(17,771) Net daily revenue per ship per day $19,411 $29,764 $2,128 $20,455 Vessel operating expenses per ship per day $(3,804) $(3,870) $(3,816) Management fees Net Operating Cash Flow per ship per day before general and administrative expenses $15,607 $25,894 $2,128 $16,639 ========== ========== ========== ========== Nine Months Ended September 30, 2005 ============================================== PANAMAX CAPESIZE CHARTER IN TOTAL ========== ========== ========== ========== Total Ownership days 973 973 Operating days under fixed rate time charter 823 823 Operating days under variable rate time charter 73 73 Operating days under spot charter Utilization 92.4% 92.4% Time charter equivalent per ship per day fixed rate tc $23,945 $23,945 Time charter equivalent per ship per day variable rate tc $14,068 $14,068 Time charter equivalent per ship per day spot Charter in costs per ship per day - spot Net daily revenue per ship per day $20,525 $20,525 Vessel operating expenses per ship per day $(3,723) $(3,723) Management fees $(608) $(608) Net Operating Cash Flow per ship per day before general and administrative expenses $16,194 $16,194 ========== ========== (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.Time Charter Coverage Mr. Molaris commented, "Our strategy is to predominantly employ our vessels under period time charters, which enables us to generate stable and predictable cash flows. In this context, we have already secured 95.1% of our time charter coverage for the fourth quarter of 2006 and 89.3% for 2007. Our period charter coverage for the years 2008, 2009 and 2010 are 75.0%, 69.6% and 62.2%, respectively. As a result, our projected net revenues under fixed time charters for the fourth quarter of 2006 will be approximately $34 million and approximately $180 million for the full year of 2007." Delivery of Metrobulk Fleet Quintana Maritime has to date taken delivery of ten vessels -- eight Kamsarmax and two Panamax vessels -- out of the total of seventeen vessels it has agreed to acquire from Metrobulk.
Mr. Molaris commented, "With the delivery of ten Metrobulk vessels, our fleet has now expanded to twenty owned and operated vessels. The successful integration of these vessels provides us with a younger fleet and a stronger operational platform to achieve our long-term goals. We have already enhanced our operational capabilities in terms of personnel and crewing to accommodate the delivery of the ten vessels we already received, as well as the remaining seven to be delivered to us. We believe the young age of the acquired fleet will have a positive impact on our fixed cost base and lower our daily operating expenses per vessel as we move into the next year." Pricing of Metrobulk Fleet for 2007 Quintana Maritime has already agreed to daily rates for 2007 for all 16 vessels it has agreed to acquire from Metrobulk that are subject to the master time charter. Seven Kamsarmaxes and two Panamaxes have been priced at an average daily rate of $23,000, five Kamsarmaxes have been priced at an average daily rate of $20,000 and two Kamsarmaxes have been priced at an average daily rate of $25,000. An additional Panamax, Grain Harvester, is on time charter with Bunge through September 2009 at $20,000 per day. All vessels are on long-term time charter to Bunge S.A., a wholly owned subsidiary of Bunge Limited (
Quintana Maritime Limited Consolidated Balance Sheets (All amounts expressed in U.S. Dollars) September 30, December 31, 2006 2005 ------------- ------------- Assets Current assets: Cash and cash equivalents $ 14,814,725 $ 4,258,809 Inventories 1,312,038 378,488 Due from charterers, net 2,535,067 1,244,123 Other receivables 792,578 479,735 Prepaid expenses and other current assets 976,899 866,562 ------------- ------------- Total current assets 20,431,307 7,227,717 Property and equipment: Vessels, net of accumulated depreciation of $30,361,202 and $11,309,344 825,569,976 446,474,869 Advances for acquisition of vessels 34,000,000 Other fixed assets, net of accumulated depreciation of $204,030 and $58,739 421,682 384,247 ------------- ------------- Total property and equipment: 859,991,658 446,859,116 Deferred financing costs, net of accumulated amortization of $2,135,859 and $63,194 4,670,682 1,959,041 Deferred time charter premium, net of accumulated amortization of $2,023,149 and $439,815 7,476,851 9,060,185 Deferred dry docking costs, net of accumulated amortization of $682,736 and $279,865 1,575,722 919,556 ------------- ------------- Total assets $ 894,146,220 $ 466,025,615 ============= ============= Liabilities and shareholders' equity Current liabilities: Accounts payable 2,991,367 1,473,592 Sundry liabilities and accruals 2,407,179 3,412,759 Deferred income 2,815,951 1,715,910 Current portion of long-term loan 45,250,000 Total current liabilities 53,464,497 6,602,261 Long-term debt 414,250,000 210,000,000 ------------- ------------- Unrealized swap loss 11,891,970 ------------- ------------- Total liabilities $ 479,606,467 $ 216,602,261 ============= ============= Shareholders' equity Common stock at $0.01 par value 100,000,000 shares authorized, 49,713,354 and 23,846,742 shares issued and outstanding 497,134 238,468 Additional paid-in capital 440,125,224 254,732,530 Deferred stock-based compensation (5,946,513) (5,187,200) Accumulated deficit (20,136,092) (360,444) ------------- ------------- Total shareholders' equity 414,539,753 249,423,354 ------------- ------------- Total liabilities and shareholders' equity $ 894,146,220 $ 466,025,615 ============= ============= QUINTANA MARITIME LIMITED Consolidated Income Statements (All amounts expressed in U.S. Dollars) Three Months Three Months Ended Ended September 30, September 30, 2006 2005 ------------- ------------- Revenues: Time charter voyage revenue $ 24,965,412 $ 13,542,694 Revenue from charter operation 1,243,325 Commissions (1,175,269) (549,492) ------------- ------------- Net revenue $ 25,033,468 $ 12,993,202 Expenses: Vessel operating expenses 4,056,716 2,335,960 Voyage expenses 1,447,802 General and administrative expenses (including restricted stock amortization of $597,873 and $315,130) 2,705,715 1,555,332 Depreciation and amortization 7,411,731 4,030,574 Management Fees 473,990 ------------- ------------- Total expenses $ 15,621,964 $ 8,395,856 ------------- ------------- ------------- ------------- Operating income $ 9,411,504 $ 4,597,346 Other (expenses) / income: Interest expense $ (3,385,659) $ (1,281,405) Interest income 440,951 132,702 Finance costs (1,946,275) (3,266,090) Unrealized swap loss (11,891,970) Foreign exchange losses and other, net (217,284) 21,172 ------------- ------------- Total other expenses $ (17,000,237) $ (4,393,621) ------------- ------------- ------------- ------------- Net (loss) / income $ (7,588,733) $ 203,725 ============= ============= Earnings per common share Basic (0.20) 0.01 Diluted (0.19) 0.01 Weighted average shares outstanding Basic 37,569,368 19,517,470 Diluted 38,922,043 19,627,598 ------------- ------------- QUINTANA MARITIME LIMITED Consolidated Income Statements (All amounts expressed in U.S. Dollars) Period from January 13, Nine Months 2005 Ended (inception) to September 30, September 30, 2006 2005 ------------- ------------- Revenues: Time charter voyage revenue $ 64,857,444 $ 20,805,604 Revenue from charter operation 4,473,668 Commissions (3,014,781) (834,861) ------------- ------------- Net revenue $ 66,316,331 $ 19,970,743 Expenses: Vessel operating expenses 11,379,790 3,622,100 Voyage expenses 4,068,427 General and administrative expenses (including restricted stock amortization of $1,626,316 and $315,130) 7,197,379 2,704,246 Depreciation and amortization 19,600,020 5,928,926 Management Fees 591,190 ------------- ------------- Total expenses $ 42,245,616 $ 12,846,462 ------------- ------------- ------------- ------------- Operating income $ 24,070,715 $ 7,124,281 Other (expenses) / income: Interest expense $ (8,349,992) $ (2,903,044) Interest income 570,163 159,970 Finance costs (2,072,665) (3,586,453) Unrealized swap loss (11,891,970) Foreign exchange losses and other, net (372,969) (3,700) ------------- ------------- Total other expenses $ (22,117,433) $ (6,333,227) ------------- ------------- ------------- ------------- Net Income $ 1,953,282 $ 791,054 ============= ============= Earnings per common share Basic 0.07 0.07 Diluted 0.07 0.07 Weighted average shares outstanding Basic 28,153,771 10,971,653 Diluted 28,928,204 11,010,472 ------------- ------------- Quintana Maritime Limited Consolidated Statements of Cash Flows (All amounts expressed in U.S. Dollars) Period from January 13, Nine Months 2005 Ended (inception) to September 30, September 30, 2006 2005 ------------- ------------- Cash flows from operating activities: Net income $ 1,953,282 $ 791,054 Adjustments to reconcile net income to net cash from operating activities: Depreciation and amortization 19,600,020 5,928,926 Amortization of deferred finance costs 2,072,665 3,586,453 Amortization of time charter fair value 1,583,334 Stock based compensation 1,626,316 Unrealized swap loss 11,891,970 Changes in assets and liabilities: Increase in inventories (933,550) (265,527) Increase in due from charterers, net (1,290,944) (83,551) Increase in other receivables (312,843) (348,827) Increase in prepaid expenses and other current (110,337) (1,025,813) Increase in accounts payable 1,517,775 723,213 (Decrease) / Increase in sundry liabilities and accruals (1,005,580) 1,068,533 Increase in deferred income 1,100,041 1,104,072 Deferred dry-dock costs incurred (1,059,037) (1,204,328) -------------- -------------- Net cash from operating activities $ 36,633,112 $ 10,274,205 -------------- -------------- Cash flows from investing activities: Vessel acquisitions (398,146,965) (330,623,650) Advances for vessel acquisitions (34,000,000) (13,680,000) Purchases of property, plant and equipment (182,726) (256,261) -------------- -------------- Net cash used in investing activities $ (432,329,691) $ (344,559,911) -------------- -------------- Cash flows from financing activities: Proceeds from long-term debt 459,500,000 411,621,351 Repayment of debt (210,000,000) (311,071,351) Payment of financing costs (4,784,306) (5,097,296) Proceeds from preferred stock issuance 190,937,657 Issuance costs of preferred stock offering (7,671,926) Proceeds from initial public offering 182,771,956 Issuance costs of initial public offering (2,179,655) Paid-in capital and common stock 68,664,437 Dividends paid (21,728,930) (1,177,731) -------------- -------------- Net cash from financing activities $ 406,252,495 $ 343,531,711 -------------- -------------- Net increase in cash and cash equivalents 10,555,916 9,246,005 Cash and cash equivalents at beginning of the period 4,258,809 -------------- -------------- Cash and cash equivalents at end of the period $ 14,814,725 $ 9,246,005 ============== ============== Cash paid during the period for interest $ 10,797,448 $ 2,093,044 Non-cash investing and financing activities: Conversion of 12% Mandatorily Convertible Preferred Stock $ 190,937,657 -------------- -------------- Quintana Maritime Limited Reconciliation of Net Income to Adjusted EBITDA (All amounts expressed in U.S. Dollars) Three Months Three Months Ended Sept. Ended Sept. 30, 2006 30, 2005 ------------ ------------ Net (Loss) / income $ (7,588,733) $ 203,725 Interest and finance costs, net 4,890,983 4,414,793 Depreciation and amortization 7,411,731 4,030,574 Unrealized loss from swap transaction 11,891,970 Amortization of time charter premium 527,778 Amortization of deferred stock-based compensation 597,873 89,115 ------------ ------------ Adjusted EBITDA $ 17,731,602 $ 8,738,207 ------------ ------------ Quintana Maritime Limited Reconciliation of Net Income to Adjusted EBITDA (All amounts expressed in U.S. Dollars) Period from January 13, Nine Months 2005 Ended (inception) to September 30, September 30, 2006 2005 ------------ ------------ Net Income $ 1,953,282 $ 791,054 Interest and finance costs, net 9,852,494 6,329,527 Depreciation and amortization 19,600,020 5,928,926 Unrealized loss from swap transaction 11,891,970 Amortization of time charter premium 1,583,334 Amortization of deferred stock-based compensation 1,626,316 89,115 ------------ ------------ Adjusted EBITDA $ 46,507,416 $ 13,138,622 ------------ ------------ Quintana Maritime Limited Reconciliation of Net Income to Adjusted Net Income (All amounts expressed in U.S. Dollars) Three Months Nine Months Ended Sept. Ended Sept. 30, 2006 30, 2006 ------------ ------------ Net (Loss) / income $ (7,588,733) $ 1,953,282 Unamortized write-off of financing costs 1,832,651 1,832,651 Unrealized loss from swap transaction 11,891,970 11,891,970 ------------ ------------ Adjusted Net Income $ 6,135,888 $ 15,677,903 ------------ ------------ Quintana Maritime Limited Reconciliation of Earnings Per Share (Diluted) to Adjusted Earnings Per Share (Diluted) (All amounts expressed in U.S. Dollars) Three Months Nine Months Ended Sept. Ended Sept. 30, 2006 30, 2006 ------------ ------------ Earnings (loss) Per Share (Diluted) $ (0.19) $ 0.07 Unamortized write-off of financing costs 0.05 0.06 Unrealized loss from swap transaction 0.30 0.41 ------------ ------------ Adjusted Earnings Per Share (Diluted) $ 0.16 $ 0.54 ------------ ------------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. 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 measure" 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 20 vessels, which consisting of 8 Kamsarmax bulker, 10 Panamax size vessels and 2 Capesize vessels with a total carrying capacity of 1,726,652 dwt and an average age of 4.7 years on a dwt weighted average. It has also entered into an agreement to take delivery of 7 additional vessels, comprising of 1 Panamax and 6 Kamsarmax bulkers with expected delivery between November 2006 and May 2007 and with an aggregate capacity of 570,229 dwt. Once all acquisitions are completed Quintana will have a fleet of 27 dry bulk vessels which consists of 2 Capesize vessels, 11 Panamax vessels and 14 Kamsarmax vessels with a total capacity of 2,296,881 dwt. 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 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 day. Fleet Table as of November 6, 2006
TC Expiration Age Date (minimum CURRENT FLEET Type DWT Year Built (in yrs) period) Iron Anne Kamsarmax 82,000 2006 0.1 December 2010 Iron Vassilis(A) Kamsarmax 82,000 2006 0.3 December 2010 Iron Bill (ex. Iron Elisabeth)(A) Kamsarmax 82,000 2006 0.4 December 2010 Santa Barbara Kamsarmax 82,266 2006 0.6 December 2010 Ore Hansa Kamsarmax 82,229 2006 0.6 December 2010 Iron Kalypso Kamsarmax 82,204 2006 0.8 December 2010 Iron Fuzeyya(A) Kamsarmax 82,229 2006 0.8 December 2010 Iron Bradyn(A) Kamsarmax 82,769 2005 1.7 December 2010 Grain Harvester Panamax 76,417 2004 2.2 September 2009 Grain Express Panamax 76,466 2004 2.6 December 2010 Kirmar(B) Capesize 165,500 2001 5.1 February 2007(C) Iron Beauty(B) Capesize 165,500 2001 5.3 April 2010 Coal Pride Panamax 72,600 1999 6.9 February 2007 Iron Man(D) Panamax 72,861 1997 9.4 March 2010 Coal Age(D) Panamax 72,861 1997 9.4 June 2007 Fearless 1(D) Panamax 73,427 1997 9.5 March 2008 Barbara(E) Panamax 73,390 1997 9.8 June 2007 Linda Leah(E) Panamax 73,390 1997 9.8 June 2008 King Coal Panamax 72,873 1997 9.9 March 2008 Coal Glory(D) Panamax 73,670 1995 11.7 June 2008 4.7 Total Current years Fleet 20 Vessels 1,726,652 avg(F) Age (in FLEET TO BE DELIVERED Type DWT Year Built years) Delivery Range Iron Knight Panamax 76,429 2004 2.4 Nov 06 Jan 07 Pascha Kamsarmax 82,300 * Nov 06 Jan 07 Iron Lindrew Kamsarmax 82,300 * Jan 07 Mar 07 Coal Gypsy Kamsarmax 82,300 * Dec 06 Coal Hunter Kamsarmax 82,300 * Dec 06 Iron Brooke Kamsarmax 82,300 * Mar 07 - May 07 Iron Manolis Kamsarmax 82,300 * May 07 Total Fleet to be Delivered 7 Vessels 570,229 TOTAL FLEET 27 Vessels 2,296,881 * Under Construction (A), (B), (D), and (E) indicate sister ships. As of November 6, 2006, 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. (C) Kirmar's charter may be extended by up to six months, until September 2007, at the current rate of $26,250 per day at the charterer's option. Charterer has a further option up to March 2008 at a rate of $27,250. (F) On a dwt weighted average
Contact Information: Company Contact: Paul J. Cornell Chief Financial Officer Tel. 713-751-7525 E-mail: pcornell@quintanamaritime.com Investor Relations / Financial Media: Paul Lampoutis Capital Link, Inc, New York Tel. 212.661.7566 E-mail: plampoutis@capitallink.com