Eagle Bulk Shipping Inc. Press Release

Eagle Bulk Shipping Inc. Reports First Quarter 2008 Results

First Quarter Net Income Increased 69%

First Quarter Net Time Charter Revenue Increased 36%

Declares First Quarter Dividend of $0.50

NEW YORK, May 6, 2008 (PRIME NEWSWIRE) -- Eagle Bulk Shipping Inc. (Nasdaq:EGLE) today announced its results for the first quarter of 2008.

Financial highlights for the First Quarter included:

* Income from vessel operations of $16.9 million or $0.36 per share, up 44% from $11.7 million or $0.31 per share in the first quarter of 2007. (Income from vessel operations is net income adjusted for non-cash compensation charges. Please see below for a reconciliation of income from vessel operations to net income).

* Net Income of $14.3 million or $0.31 per share (based on a weighted average of 46,925,494 diluted shares outstanding for the quarter), up 69% from net income of $8.5 million or $0.23 per share (based on a weighted average of 37,480,914 diluted shares outstanding for the quarter) in the first quarter of 2007.

* Gross time charter revenue increased by $9.1 million, or 31%, to $38.6 million for the first quarter of 2008, from $29.5 million for the first quarter of 2007. Net time charter revenue increased by $9.8 million, or 36%, to $36.7 million for the first quarter of 2008, from $26.9 million for the first quarter of 2007

* EBITDA, as adjusted for exceptional items under the terms of the Company's credit agreement, increased by 27% to $27.5 million for the first quarter of 2008, from $21.8 million for the first quarter of 2007. Please see below for a reconciliation of EBITDA to net income.

* Declared and paid a dividend of $0.50 per share, or $23.4 million, on March 18, 2008, based on the fourth quarter 2007 results.

Based on the first quarter results, the Company has declared a cash dividend of $0.50 per share payable on or about May 23, 2008, to shareholders of record as of May 20, 2008.

Sophocles N. Zoullas, Chairman and Chief Executive Officer, commented, "We are very pleased with our solid results as the fleet continues to deliver superior performance and generate significant cash flows. This allows our shareholders to participate in the strength of the drybulk market through our dividends. With this quarter's declared dividend of $0.50 per share, shareholders have realized aggregate dividends of $5.60 per share.

"Looking forward, Eagle Bulk is poised to realize significant growth from our well-timed, $1.5 billion capital investment program in newbuilding vessels and opportunistic acquisitions. We will be taking delivery of the first of the 35 vessels this summer, to be followed by an accelerated vessel delivery calendar thereafter. And beginning this summer, we also have several on-the-water vessels of our operating fleet coming open for re-chartering to take advantage of the strong dry bulk market. These factors have positioned the Company to significantly increase cash flow and returns for our shareholders in the second half of 2008 and beyond."

Results of Operations for the three month periods ended March 31, 2008 and 2007

All of the Company's revenues were earned from Time Charters. Gross revenues in the first quarter of 2008 were $38,610,921, an increase of 31% from the $29,476,374 recorded in the comparable quarter in 2007, primarily due to a larger fleet size, as reflected by increased operating days, and an increase in daily time charter rates. Brokerage commissions incurred on revenues earned were $1,924,905 and $1,487,842 in the first quarters of 2008 and 2007, respectively. The first quarter of 2007 also reflected an amortization charge of net prepaid and deferred charter revenue of $1,080,000. Net revenues during the three months ended March 31, 2008, and 2007 were $36,686,016 and $26,908,532, respectively, an increase of 36%.

For the first quarter of 2008, total vessel expenses incurred amounted to $7,991,261. These expenses included $7,439,959 in vessel operating costs and $551,302 in technical management fees paid to the Company's third-party technical managers. For the corresponding quarter in 2007, total vessel expenses were $6,245,898 which included $5,836,461 in vessel operating costs and $409,437 in technical management fees.

General and administrative expenses which include onshore vessel administration related expenses such as payroll, non-cash compensation expenses, and overhead costs for the three-month periods ended March 31, 2008 and 2007 were $5,049,159 and $4,903,043, respectively.

EBITDA, as adjusted for exceptional items under the terms of the Company's credit agreement, increased by 27% to $27,547,805 for the first quarter of 2008, from $21,769,767 for the comparable quarter in 2007. (Please see below for a reconciliation of EBITDA to net income)

In the first quarter of 2008, income from vessel operations, which is net income adjusted for non-cash compensation charges, was $16,861,513 or $0.36 per share, up 44% from $11,747,011 or $0.31 per share in the first quarter of 2007. (Please see below for a reconciliation of income from vessel operations to net income).

Net income for the first quarter of 2008 was $14,345,810, an increase of 69% from $8,487,788 in the comparable quarter in 2007. Earnings per share in the first quarter of 2008 were $0.31, based on a weighted average of 46,925,494 diluted shares outstanding. In the comparable quarter of 2007, earnings per share were $0.23, based on a weighted average of 37,480,914 diluted shares outstanding.

Liquidity and Capital Resources

Net cash provided by operating activities during the three month periods ended March 31, 2008 and 2007 was $26,454,362 and $18,801,874, respectively. The increase was primarily due to cash generated from the operation of the fleet for 1,638 days in the first quarter of 2008 compared to 1,407 days in the first quarter of 2007.

Net cash used in investing activities during the first quarter of 2008 was $13,399,474 compared to $37,251,697 during the corresponding quarter in 2007. Investing activities in this quarter related primarily to making progress payments and related construction costs for the newbuilding vessels. Investing activities in the first quarter of 2007 related primarily to making deposits toward acquiring second-hand vessels and the newbuilding vessels. The first quarter of 2007 also saw the Company receive proceeds from the sale of its oldest vessel.

Net cash used in financing activities during the first quarter of 2008 was $17,445,157, compared to net cash provided by financing activities of $115,169,544 during the first quarter of 2007. Financing activities in this quarter included borrowing $6,630,000 from the revolving credit facility to fund progress payments for the newbuilding vessels and paying $23,378,577 in dividends. Financing activities in the first quarter of 2007 mostly relate to receipt of $107,428,803 in net proceeds from the sale of common shares, net borrowings of $25,649,741 from the revolving credit facility, and payment of $18,309,000 in dividends.

The Company's cash balances at the end of the first quarters of 2008 and 2007 were $148,513,423 and $118,995,212, respectively. In addition, the Company maintains restricted cash of $9,000,000 with its lender for loan compliance purposes.

About Eagle Bulk Shipping Inc.
Eagle Bulk Shipping Inc. is a Marshall Islands corporation headquartered in New York. The Company is the largest U.S. based owner of Handymax dry bulk vessels. Handymax vessels range in size from 35,000 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.

Eagle Bulk Shipping Inc.