DRYSHIPS REPORTS RESULTS FOR THE FOURTH QUARTER AND TWELVE MONTHS ENDED DECEMBER 31, 2007

February 14, 2008, Athens, Greece. DryShips Inc. (NASDAQ: DRYS), a global provider of marine transportation services for drybulk cargoes, today announced its unaudited financial and operating results for the fourth quarter and twelve months ended December 31, 2007.

Financial Highlights

• For the fourth quarter of 2007 the Company reported Net Income of $195.2 million or $5.37 per share. Included in the fourth quarter results is a capital gain on the sale of 1 vessel of $31.5 million or $0.87 per share. Excluding this gain, Net Income would amount to $163.7 million or $4.50 per share.
• For the fourth quarter of 2007 the Company reported EBITDA1 of $229.3 million.
• For the year ended December 2007, the Company reported Net Income of $475.4 million or $13.32 per share. Included in the full year results is a capital gain on the sale of 11 vessels of $135.0 million or $3.78 per share. Excluding this gain, Net Income would amount to $340.4 million or $9.54 per share.
• For the year ended December 2007 the Company reported EBITDA of $600.8 million.
• In January 2008 the Company declared and paid its eleventh consecutive quarterly cash dividend of $0.20 per common share.

George Economou, the Company’s Chairman and Chief Executive Officer, commented:

“We are very pleased to report the best quarter in the Company’s history so far. Since our IPO in 2005 when we started out with a fleet of 6 vessels with an average age of 19 years we have grown to the biggest drybulk company listed in the US with a fleet comprising of 47 vessels with an average age of 8.8 years. In the meantime, our stock price has risen from $18 per share to $84.25 per share as of today’s close, which implies a return to our initial shareholders of 368.1%. Our clear market view and choice of spot employment has been proven correct and has created superior shareholder value.

We enter 2008 with a great deal of optimism. The supply and demand balance for this year remains extremely tight. In 2008 we expect to have approximately 17% more fleet operating days compared to 2007 and as of today approximately 63% of the fleet operating days remains unfixed. DryShips is in a unique position to take advantage of the strong freight rate environment and continue to maximize shareholder value.”


Fourth Quarter 2007 Results

For the fourth quarter ended December 31, 2007, Time charter equivalent revenues (Voyage Revenues less Voyage Expenses) amounted to $223.5 million as compared to $74.0 million for the fourth quarter ended December 31, 2006. Operating Income was $211.9 million for the quarter ended December 31, 2007, as compared to $46.3 million for the quarter ended December 31, 2006. Net Income for the fourth quarter of 2007 was $195.2 million or $5.37 Earnings Per Share (EPS) calculated on 36.32 million weighted average basic and diluted shares outstanding as compared to $35.9 million or $1.02 Earnings Per Share (EPS) calculated on 35.33 million weighted average basic and diluted shares outstanding for the quarter ended December 31, 2006. EBITDA2 for the fourth quarter of 2007 was $229.3 million as compared to $63.8 million in the quarter ended December 31, 2006.

An average of 36.12 vessels were owned and operated during the fourth quarter of 2007, earning an average Time Charter Equivalent, or TCE, rate of $67,587 per day as compared to an average of 33.86 vessels owned and operated during the fourth quarter of 2006 earning an average TCE rate of $24,466 per day.


Year ended December 31, 2007 Results

For the year ended December 31, 2007, Time charter equivalent revenues (Voyage Revenues less Voyage Expenses) amounted to $550.9 million as compared to $232.5 million for the year ended December 31, 2006. Operating Income was $528.1 million for the year ended December 31, 2007 as compared to $96.5 million for the year ended December 31, 2006. Net Income for the year ended December 2007 was $475.4 million or $13.32 Earnings Per Share (EPS) calculated on 35.70 million weighted average basic and diluted shares outstanding as compared to $56.7 million or $1.75 Earnings Per Share (EPS) calculated on 32.35 million weighted average basic and diluted shares outstanding for the year ended December 31, 2006. EBITDA2 for the year ended December 31, 2007 was $600.8 million as compared to $159.0 million in the year ended December 31, 2006.

An average of 33.67 vessels were owned and operated during the year ended December 31, 2007, earning an average Time Charter Equivalent, or TCE, rate of $45,417 per day as compared to an average of 29.76 vessels owned and operated during the year ended December 31, 2006 earning an average TCE rate of $21,918 per day.


Drydock related expenses

During the fourth quarter of 2007, one vessel was drydocked for a total direct cost of $0.6 million. Such costs are capitalized and amortized until the vessels’ next drydock.


Capitalization

On December 31, 2007, debt to total capitalization (debt, net of deferred financing fees and stockholders' equity) was 54.82% and net debt (total debt less cash and cash equivalents) to total capitalization was 51.90%.

As of December 31, 2007, the Company had a total liquidity of approximately $137.9 million.


Financing activities

On November 16, 2007 the Company concluded a loan agreement in the amount of $47 million in order to partly finance the acquisition cost of the MV Oregon. The loan bears interest at LIBOR plus a margin and will be repaid in thirty-two quarterly installments through December 2015

On December 4, 2007 the Company concluded a loan agreement in the amount of $101.2 million in order to partly finance the acquisition cost of the vessels MV Saldahna and MV Avoca. The loan bears interest at LIBOR plus a margin and will be repaid in twenty-eight quarterly installments through January 2015.

On December 17, 2007, the Company concluded a loan agreement in the amount of $243.1 million in order to partly finance the acquisition cost of 51,778,647 shares in the common stock of Ocean Rig ASA. The loan bears interest at LIBOR plus a margin and will be repaid in eight quarterly installments through December 2009.

As of February 14, 2008 the Company had a total of $1.3 billion in debt outstanding.


About DryShips, Inc.

DryShips Inc., based in Greece, is an owner and operator of drybulk carriers that operate worldwide. As of the day of this release, DryShips owns a fleet of 47 drybulk carriers comprising 5 Capesize, 31 Panamax, 2 Supramax, 1 Handymax, and 8 newbuilding drybulk vessels, with a combined deadweight tonnage of over 4.25 million tons.

DryShips Inc.'s common stock is listed on the NASDAQ Global Market where it trades under the symbol "DRYS".

DryShips Inc. Press Release