Investors

Genco Shipping & Trading Limited Announces Second Quarter 2008 Financial Results

Jul 30, 2008

Declares Dividend of $1.00 per Share for Q2 2008

NEW YORK, July 30 /PRNewswire-FirstCall/ -- Genco Shipping & Trading Limited (NYSE: GNK) today reported its financial results for the three and six months ended June 30, 2008.

The following financial review discusses the results for the three and six months ended June 30, 2008 and June 30, 2007.

               Second Quarter 2008 and Year-to-Date Highlights

-- Declared a dividend $1.00 per share, based on Q2 2008 results, payable on or about August 29, 2008 to all shareholders of record as of August 15, 2008;

-- Excluding the $2.6 million in dividends received from our investment in Jinhui Shipping and Transportation shares, recorded net income of $58.3 million, or $1.96 basic and $1.95 diluted earnings per share;

-- Recorded net income of $60.9 million, or $2.05 basic and $2.03 diluted earnings per share;

-- Completed the closing of a $204 million follow-on offering accompanied by a secondary offering;

-- Agreed to the acquisition of two Panamax and one Supramax vessel from Bocimar International N.V. and Delphis N.V. for an aggregate purchase price of $257 million;

-- Agreed to the acquisition of three Capesize and three Handysize vessels for an aggregate purchase price of $530 million;

-- Took delivery of the Genco Raptor and Genco Cavalier, two of the three vessels from the Bocimar acquisition;

-- Reached time charter agreements for six vessels, including one from the Bocimar acquisition and one from the Metrostar acquisition; and

-- Paid a $1.00 per share dividend on May 30, 2008 based on Q1 2008 results.

                    Financial Review: 2008 Second Quarter

Excluding the $2.6 million dividends received from the investment in Jinhui Shipping and Transportation shares, the Company recorded net income of $58.3 million, or $1.96 basic and $1.95 diluted earnings per share. Including these dividends, the Company recorded net income for the second quarter of 2008 of $60.9 million, or $2.05 basic and $2.03 diluted earnings per share. Net income was $134.9 million or $4.61 basic and $4.58 diluted earnings per share for the six months ended June 30, 2008. Comparatively, for the six months ended June 30, 2007 net income was $33.6 million or $1.33 basic and $1.32 diluted earnings per share.

EBITDA was $85.7 million for the three months ended June 30, 2008 versus $25.4 million for the three months ended June 30, 2007.

Robert Gerald Buchanan, President, commented, "During the second quarter, we benefited from favorable contracts, and, in particular, profit sharing agreements that enabled the Company to take advantage of robust market conditions and post strong results. Consistent with our strategy, we maintained an intense focus on securing our vessels on time charters, during a time in which we further consolidated the drybulk industry by agreeing to add nine vessels to our fleet. Specifically, we renewed vessels at attractive rates and signed newly acquired vessels on charters prior to their delivery. We currently have approximately 94% of our fleet's available days secured on contracts for the remainder of 2008 and 60% in 2009. With a modern versatile fleet, we remain in a strong position to provide charterers with the highest quality service while capitalizing on the strong demand for essential commodities such as iron ore and coal."

Genco Shipping & Trading Limited revenues increased 184% to $104.6 million for the three months ended June 30, 2008 versus $36.8 million for the three months ended June 30, 2007, due to the operation of a larger fleet as well as the renewal of time charters at higher charter rates than those contracted previously.

The average daily time charter equivalent, or TCE, rates obtained by the Company's fleet increased 95% to $40,945 per day for the three months ended June 30, 2008 compared to $21,046 for the three months ended June 30, 2007. The increase in TCE rates was due to higher charter rates achieved in the second quarter of 2008 versus the second quarter of 2007 for two of the Panamax vessels, six of the Handymax vessels, and five of the Handysize vessels in our current fleet. Furthermore, higher TCE rates were achieved in the second quarter of 2008 versus the same period last year due to the operation of five Capesize vessels acquired as part of the Metrostar acquisition.

Total operating expenses increased to $33.8 million for the three months ended June 30, 2008 from $18.3 million for the three-month period ended June 30, 2007, due to higher vessel operating expenses, general and administrative expenses and depreciation and amortization related to the operation of a larger fleet. Vessel operating expenses were $11.2 million for the second quarter of 2008 compared to $6.4 million for the same period last year. The increase in vessel operating expenses was due to the operation of a larger fleet, higher crewing and lube expenses, as well as the operation of larger class vessels, namely Capesize vessels for the second quarter of 2008 versus the same period last year. We expect our vessel operating expenses, which generally represent variable costs, to further increase as a result of the expansion of our fleet. Depreciation and amortization expenses increased to $16.7 million for the second quarter of 2008 from $7.4 million for the second quarter of 2007 related to the growth of our fleet. General and administrative expenses increased to $4.4 million from $3.1 million during the comparative periods due to costs associated with higher employee non-cash compensation and other employee related costs. Management fees were $0.7 million for the three months ended June 30, 2008 and $0.4 million for the three months ended June 30, 2007, respectively, and relate to fees paid to our independent technical managers.

Daily vessel operating expenses grew to $4,378 per vessel per day during the second quarter of 2008 from $3,727 for the same quarter last year as a result of higher crew and lube expenses as well as the operation of five Capesize vessels. We believe daily vessel operating expenses are best measured for comparative purposes over a 12-month period in order to take into account all of the expenses that each vessel in our fleet will incur over a full year of operation. Based on estimates provided by our technical managers and management's expectations, our 2008 DVOE budget is $4,700 per vessel per day.

                      Financial Review: First Half 2008

Net income was $134.9 million or $4.61 basic and $4.58 diluted earnings per share, for the six months ended June 30, 2008 compared to $33.6 million, or $1.33 basic and $1.32 diluted earnings per share for the six months ended June 30, 2007. Included in net income for the six months ended June 30, 2008 is a $26.2 million gain from the sale of the Genco Trader, $2.6 million of income received from our investment in stock of Jinhui Shipping and Transportation Limited, and a loss from derivative instruments of $1.4 million. Revenues increased 165% to $196.2 million for the six months ended June 30, 2008 compared to $74.1 million for the six months ended June 30, 2007. EBITDA was $181.5 million for the six months ended June 30, 2008 versus $55.9 for the six months ended June 30, 2007. TCE rates obtained by the Company increased to $38,419 per day for the six months ended June 30, 2008 from $20,863 for the same period in 2007. Total operating expenses were $40.1 million for the six months ended June 30, 2008 compared to $33.3 for the six months ended June 30, 2007, and daily vessel operating expenses per vessel were $4,328 versus $3,677 for the comparative periods.

                       Liquidity and Capital Resources

                                  Cash Flow

Net cash provided by operating activities for the three months ended June 30, 2008 and 2007, was $131.6 million and $47.5 million, respectively. The increase was primarily due to the operation of a larger fleet, which contributed to increases in net income, depreciation, and deferred revenues. Adjustments to operating cash flows include $9.6 million of realized losses on forward currency contracts offset by $9.9 million of unrealized gains on hedged short-term investments and $2.6 million of realized income from dividends. Increases to cash flow were offset by $26.2 million in gains from the sale of the Genco Trader and $11.6 million of amortization of value of the time charters acquired as part of the Metrostar and Evalend acquisitions. Net cash provided by operating activities for the three months ended June 30, 2007 was primarily a result of recorded net income of $33.6 million, less the gain from the sale of the Genco Glory of $3.6 million, plus depreciation and amortization charges of $14.6 million.

Net cash used in investing activities was $302.0 million for the six months ended June 30, 2008 as compared to $90.4 for the six months ended June 30, 2007. For the six months ended June 30, 2008, cash used in investing activities primarily related to the purchase of vessels in the amount of $247.1 million, deposits on vessels to be acquired of $80.6 million, the purchase of $10.3 million of Jinhui stock, and payments on forward currency contracts of $9.6 million. The above were offset by proceeds from the sale of the Genco Trader in the amount of $43.1 million. For the three months ended June 30, 2007 the cash used in investing activities primarily related to the purchase of short-term investments of $103.1 million, offset by the sale of the Genco Glory in the amount of $13.0 million.

Net cash provided by financing activities for the six months ended June 30, 2008 was $194.8 million as compared to $37.1 million for the six months ended June 30, 2007. For the six months ended June 30, 2008, net cash provided by financing activities consisted of the drawdown of $321.3 million related to the purchase of vessels and $195.7 million in net proceeds from our May 2008 follow-on offering. These inflows were offset by the repayment of $268.0 million under the 2007 credit facility and the payment of cash dividends of $53.8 million. For the same period last year, net cash provided by financing activities consisted of $77.0 million of proceeds from a short-term line used to finance the purchase of Jinhui shares, and was offset by the payment of cash dividends of $33.7 million and the repayment of $5.7 million under our 2005 credit facility.

                             Capital Expenditures

We make capital expenditures from time to time in connection with vessel acquisitions. Our current fleet consists of five Capesize, seven Panamax, four Supramax, six Handymax and eight Handysize vessels, with an aggregate carrying capacity of approximately 2,150,000 dwt. After the expected delivery of 11 vessels the Company has agreed to acquire, Genco Shipping & Trading Limited will own a fleet of 41 drybulk vessels, consisting of 12 Capesize, eight Panamax, four Supramax, six Handymax and 11 Handysize vessels, with an aggregate carrying capacity of approximately 3,516,000 dwt.

In addition to acquisitions that we may undertake in future periods, we will incur additional capital expenditures due to special surveys and drydockings for our fleet. We estimate that five of our vessels will be drydocked in the remainder of 2008, of which three will be drydocked during the third quarter of 2008 and two vessels in the fourth quarter of 2008. An additional five of our vessels will be drydocked in 2009.

    We estimate our drydocking costs for our fleet through 2009 to be:

                                   Q3 2008         Q4 2008          2009
    Estimated Costs(1)          $2.6 million    $1.9 million    $4.1 million
    Estimated Offhire Days(2)         60              40             100

    (1) Estimates are based on our budgeted cost of drydocking our vessels in
        China.  Actual costs will vary based on various factors, including
        where the drydockings are actually performed.  We expect to fund these
        costs with cash from operations.
    (2) Assumes 20 days per drydocking per vessel.  Actual length will vary
        based on the condition of the vessel, yard schedules and other
        factors.

The Genco Sugar completed its drydocking during the second quarter of 2008 at a cost of approximately $0.7 million. The vessel was on planned offhire for 17.9 days in connection with this scheduled drydocking.

                      Update on Share Repurchase Program

The Company previously announced that its Board of Directors has approved a share repurchase program for up to a total of $50 million of the Company's common stock. As of June 30, 2008, the Company has not bought back any shares.

As of July 30, 2008, the Company had 31,795,978 shares of common stock outstanding.

                Summary Consolidated Financial and Other Data

The following table summarizes Genco Shipping & Trading Limited's selected consolidated financial and other data for the periods indicated below.

                                Three Months Ended         Six Months Ended
                                June 30,    June 30,     June 30,    June 30,
                                  2008        2007         2008        2007
                               (Dollars in thousands,  (Dollars in thousands,
                                except share and per    except share and per
                                    share data)              share data)
                                    (unaudited)              (unaudited)
    INCOME STATEMENT DATA:
    Revenues                    $104,572     $36,847     $196,242     $74,067

    Operating expenses:
     Voyage expenses                 724       1,017        1,468       2,430
     Vessel operating
      expenses                    11,187       6,445       22,106      12,834
     General and
      administrative expenses      4,431       3,052        8,842       6,247
     Management fees                 665         393        1,338         744
     Depreciation and
      amortization                16,748       7,433       32,612      14,619
     Gain on sale of vessel          -           -        (26,227)     (3,575)
      Total operating
       expenses                   33,755      18,340       40,139      33,299

    Operating income              70,817      18,507      156,103      40,768

    Other (expense) income:
     Income from short-term
      investment                   2,590         -          2,590          -
     (Loss) Income from
      derivative instruments      (1,315)     (1,594)      (1,380)     (1,594)
     Interest income                 422         888          975       1,954
     Interest expense            (11,615)     (4,080)     (23,402)     (7,570)
      Other (expense) income:     (9,918)     (4,786)     (21,217)     (7,210)


    Net income                   $60,899     $13,721     $134,886     $33,558

    Earnings per share -
     basic                         $2.05       $0.54        $4.61       $1.33

    Earnings per share -
     diluted                       $2.03       $0.54        $4.58       $1.32

    Weighted average shares
     outstanding - basic      29,750,309  25,312,593   29,242,118  25,310,783

    Weighted average shares
     outstanding - diluted    29,957,698  25,456,413   29,436,024  25,439,043



                                             June 30, 2008   December 31, 2007
    BALANCE SHEET DATA:                       (unaudited)

    Cash                                         $95,964           $71,496
    Current assets, including cash               270,895           267,594
    Total assets                               1,951,696         1,653,272
    Current liabilities, including
     current portion of long-term debt            29,742            70,364
    Total long-term debt, including
     current portion                             989,250           936,000
    Shareholders' equity                         877,282           622,185


                                                     Six Months Ended
                                             June 30, 2008     June 30, 2007
                                                        (unaudited)

    Net cash provided by operating activities    131,627            47,540
    Net cash used in investing activities       (302,000)          (90,401)
    Net cash provided by financing activities    194,841            37,105



                                         Three Months Ended  Six Months Ended
                                          June 30, June 30,  June 30, June 30,
                                            2008     2007      2008     2007
    FLEET DATA:                              (unaudited)        (unaudited)
    Total number of vessels at end of
     period                                    29       19        29       19
    Average number of vessels (1)            28.1     19.0      28.1     19.3
    Total ownership days for fleet (2)      2,555    1,729     5,107    3,491
    Total available days for fleet (3)      2,536    1,703     5,070    3,434
    Total operating days for fleet (4)      2,518    1,668     5,033    3,371
    Fleet utilization (5)                    99.3%    98.0%     99.3%    98.2%


    AVERAGE DAILY RESULTS:
    Time charter equivalent (6)           $40,945  $21,046   $38,419  $20,863
    Daily vessel operating expenses per
     vessel (7)                             4,378    3,727     4,328    3,677



                                         Three Months Ended Six Months Ended
                                         June 30, June 30,  June 30, June 30,
                                           2008     2007      2008     2007
                                            (Dollars in       (Dollars in
                                              thousands)        thousands)
    EBITDA Reconciliation:                   (unaudited)        (unaudited)
      Net Income                          $60,899  $13,721  $134,886  $33,558
      + Net interest expense               11,193    3,192    22,427    5,616
      + Depreciation and amortization      16,748    7,433    32,612   14,619
      + Amortization of nonvested stock
         compensation                       1,607      585     3,195    1,171
      + Amortization of value of time
         charters acquired                 (4,761)     461   (11,610)     917
        EBITDA(8)                          85,686   25,392   181,510   55,881

(1) Average number of vessels 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 part of our fleet during the period divided by the number of calendar days in that period.

(2) 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.

(3) We define available days as the number of our ownership days less the aggregate number of days that our vessels are off-hire due to scheduled repairs or repairs under guarantee, vessel upgrades or special surveys and the aggregate amount of time that we spend positioning our vessels. Companies in the shipping industry generally use available days to measure the number of days in a period during which vessels should be capable of generating revenues.

(4) 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 unforeseen circumstances. The shipping industry uses operating days to measure the aggregate number of days in a period during which vessels actually generate revenues.

(5) We calculate 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 number 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.

(6) We define TCE rates as our net voyage revenue (voyage revenues less voyage expenses) divided by the number of our available days during the period, which is consistent with industry standards. TCE rate is a common 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 charterhire rates for vessels on voyage charters are generally not expressed in per-day amounts while charterhire rates for vessels on time charters generally are expressed in such amounts. Since some vessels were acquired with an existing time charter at a below-market rate, we allocated the purchase price between the vessel and an intangible liability for the value assigned to the below-market charterhire. This intangible liability is amortized as an increase to voyage revenues over the minimum remaining term of the charter.

(7) We define daily vessel operating expenses to include crew wages and related costs, the cost of insurance expenses relating to repairs and maintenance (excluding drydocking), the costs of spares and consumable stores, tonnage taxes and other miscellaneous expenses. Daily vessel operating expenses are calculated by dividing vessel operating expenses by ownership days for the relevant period.

(8) EBITDA represents net income plus net interest expense, income tax expense, depreciation and amortization, amortization of nonvested stock compensation, and amortization of the value of time charter acquired. EBITDA is included because it is used by management and certain investors as a measure of operating performance. EBITDA is used by analysts in the shipping industry as a common performance measure to compare results across peers. Our management uses EBITDA as a performance measure in consolidating internal financial statements and it is presented for review at our board meetings. EBITDA is also used by our lenders in certain loan covenants. For these reasons, we believe that EBITDA is a useful measure to present to our investors. EBITDA is not an item recognized by U.S. GAAP and should not be considered as an alternative to net income, operating income or any other indicator of a company's operating performance required by U.S. GAAP. EBITDA is not a source of liquidity or cash flows as shown in our consolidated statement of cash flows. The definition of EBITDA used here may not be comparable to that used by other companies.

                   Genco Shipping & Trading Limited's Fleet

Our current fleet consists of five Capesize, seven Panamax, four Supramax, six Handymax and eight Handysize drybulk carriers with an aggregate carrying capacity of approximately 2,150,000 dwt. Our current fleet contains seven groups of sister ships, which are vessels of virtually identical sizes and specifications. We believe that maintaining a fleet that includes sister ships reduces costs by creating economies of scale in the maintenance, supply and crewing of our vessels. As of June 30, 2008, the average age of our current fleet was 6.5 years, as compared to the average age for the world fleet of approximately 16 years for the drybulk shipping segments in which we compete. All of the vessels in our current fleet are currently on long-term time charters with an average remaining life of approximately 22 months as of June 30, 2008.

    The following table reflects the current employment of Genco's current
fleet as well as the employment or other status of vessels expected to join
Genco's fleet:
                                                              Net
                                                      Cash    Revenue Expected
    Vessel      Year                   Charter        Daily   Daily   Delivery
                Built   Charterer      Expiration(1)  Rate(2) Rate(3)   (4)

    Capesize Vessels

    Genco       2007     Cargill       December 2009   45,263  62,750      -
    Augustus         International S.A.

    Genco       2007     Cargill       January 2010    45,263  62,750      -
    Tiberius         International S.A.

    Genco       2007   SK Shipping      August 2010    57,500  64,250      -
    London               Co., Ltd

    Genco       2007     Cargill       September 2011  45,000  46,250      -
    Titus            International S.A.                  (5)

    Genco       2008     Cargill         August 2012   52,750              -
    Constantine      International S.A.                  (5)

    Genco       2008     Cargill       46 to 62 months 65,000             Q4
    Hadrian     (6)  International S.A. from delivery     (5)            2008

    Genco       2009  To be determined       TBD         TBD              Q2
    Commodus    (6)       ("TBD")                                        2009

    Genco       2009        TBD              TBD         TBD              Q2
    Maximus     (6)                                                      2009

    Genco       2009        TBD              TBD         TBD              Q2
    Aurelius    (6)                                                      2009

    Genco       2009        TBD              TBD         TBD              Q3
    Claudius    (6)                                                      2009

    Genco       2009        TBD              TBD         TBD              Q3
    Julian      (6)                                                      2009

    Genco       2009        TBD              TBD         TBD              Q4
    Valerian    (6)                                                      2009


    Panamax Vessels

    Genco       1999     Cargill          May 2009     31,500              -
    Beauty           International S.A.

    Genco       1999  SK Shipping Ltd.    May 2009     37,700              -
    Knight

    Genco       1999   A/S Klaveness   December 2008   25,650              -
    Leader               Chartering                      (7)

    Genco       1999  STX Panocean (UK)  March 2009    29,000              -
    Vigour                Co. Ltd.                       (8)

    Genco       1999   ArcelorMittal      July 2011    55,250              -
    Acheron                                              (9)

    Genco       1998  Hanjin Shipping  December 2010   42,100              -
    Surprise             Co., Ltd.

    Genco       2007    COSCO Bulk      April 2012     52,800              -
    Raptor          Carriers Co., Ltd.

    Genco       2007        TBD              TBD         TBD              Q4
    Thunder                                                              2008


    Supramax Vessels

    Genco       2005   A/S Klaveness    October 2008   58,000              -
    Predator            Chartering                       (10)

    Genco       2005  Hyundai Merchant  November 2010  38,750              -
    Warrior           Marine Co. Ltd.

    Genco       2007   Pacific Basin     June 2009     62,000              -
    Hunter             Chartering Ltd.                   (11)

    Genco      2007     Samsun Logix     July 2010     48,500  47,700      -
    Cavalier            Corporation                      (12)


    Handymax Vessels

    Genco      1997     Korea Line     February 2011   33,000              -
    Success             Corporation                      (13)

    Genco      1998    Louis Dreyfus    March 2011     37,000              -
    Carrier             Corporation

    Genco      1997   Pacific Basin      June 2011     37,000              -
    Prosperity        Chartering Ltd                     (14)

    Genco      1997   Hyundai Merchant  February 2011  34,500              -
    Wisdom            Marine Co. Ltd.

    Genco      1996    NYK Bulkship      March 2009    47,000              -
    Marine             Europe S.A.

    Genco      2001     Norden A/S      August 2008    47,650              -
    Muse


    Handysize Vessels

    Genco      1999     Lauritzen       August 2009    19,500              -
    Explorer            Bulkers A/S

    Genco      1999     Lauritzen       August 2009    19,500              -
    Pioneer             Bulkers A/S

    Genco      1999     Lauritzen       August 2009    19,500              -
    Progress            Bulkers A/S

    Genco      1999     Lauritzen       August 2009    19,500              -
    Reliance            Bulkers A/S

    Genco      1998     Lauritzen       August 2009    19,500              -
    Sugar               Bulkers A/S

    Genco      2005   Pacific Basin    November 2010   24,000              -
    Charger           Chartering Ltd.

    Genco      2003   Pacific Basin    November 2010   24,000              -
    Challenger        Chartering Ltd.

    Genco      2006   Pacific Basin    December 2010   24,000              -
    Champion          Chartering Ltd.

    Genco      2008         TBD              TBD         TBD              Q4
    Eagle                                                                2008

    Genco      2008         TBD              TBD         TBD              Q1
    Falcon                                                               2009

    Genco      2008         TBD              TBD         TBD              Q1
    Hawk                                                                 2009

(1) The charter expiration dates presented represent the earliest dates that our charters may be terminated in the ordinary course. Except for the Genco Titus, under the terms of each contract, the charterer is entitled to extend time charters from two to four months in order to complete the vessel's final voyage plus any time the vessel has been off-hire. The charterer of the Genco Titus has the option to extend the charter for a period of one year.

(2) Time charter rates presented are the gross daily charterhire rates before third party commissions ranging from 1.25% to 6.25%, except as indicated for the Genco Leader in note 7 below. In a time charter, the charterer is responsible for voyage expenses such as bunkers, port expenses, agents' fees and canal dues.

(3) For the vessels acquired with a below-market time charter rate, the approximate amount of revenue on a daily basis to be recognized as revenues is displayed in the column named "Net Revenue Daily Rate" and is net of any third-party commissions. Since these vessels were acquired with existing time charters with below-market rates, we allocated the purchase price between the respective vessel and an intangible liability for the value assigned to the below-market charterhire. This intangible liability is amortized as an increase to voyage revenues over the minimum remaining term of the charter. For cash flow purposes, we will continue to receive the rate presented in the "Cash Daily Rate" column until the charter expires.

(4) Dates for vessels being delivered in the future are estimates based on guidance received from the sellers and/or the respective shipyards.

(5) These charters include a 50% index-based profit sharing component above the respective base rates listed in the table. The profit sharing between the charterer and us for each 15-day period is calculated by taking the average over that period of the published Baltic Cape Index of the four time charter routes, as reflected in daily reports. If such average is more than the base rate payable under the charter, the excess amount is allocable 50% to each of the charterer and us. A third-party brokerage commission of 3.75% based on the profit sharing amount due to us is payable out of our share.

(6) Year built for vessels being delivered in the future are estimates based on guidance received from the sellers and/or the respective shipyards.

(7) The time charter rate presented is the net daily charterhire rate. There are no payments of commissions associated with this time charter.

(8) We have entered into a time charter for 23 to 25 months at a rate of $33,000 per day for the first 11 months, $25,000 per day for the following 11 months and $29,000 per day thereafter, less a 5% third-party commission. For purposes of revenue recognition, the time charter contract is reflected on a straight-line basis at approximately $29,000 per day for 23 to 25 months in accordance with generally accepted accounting principles in the United States, or U.S. GAAP.

(9) We have entered into a time charter agreement with ArcelorMittal for 35 to 37 months at a rate of $55,250 per day less a 5% third-party commission. The vessel is currently in drydocking and is expected to deliver to its new charterer on or about August 1, 2008.

(10) We have entered into a short-term time charter with A/S Klaveness Chartering for 3 to 5 months at a rate of $58,000 per day less a 5% third-party commission. The new charter commenced following the completion of the prior time charter on July 18, 2008.

(11) We have reached an agreement to extend the time charter with Pacific Basin Chartering Ltd. for 11 to 13.5 months at a rate of $62,000 per day, less a 5% third party brokerage commission. The time charter commenced following the expiration of the vessel's prior time charter on July 21, 2008.

(12) The time charter for this vessel commenced on July 19, 2008. In completing the negotiation of certain changes we required for novation of the existing charter, we agreed to reduce the daily gross rate and received a rebate from the brokers involved in the vessel sale. Since the vessel was acquired with a below-market rate, we allocated the purchase price between the vessel and an intangible liability for the value assigned to the below-market charterhire.

(13) We extended the time charter for an additional 35 to 37.5 months at a rate of $40,000 per day for the first 12 months, $33,000 per day for the following 12 months, $26,000 per day for the next 12 months and $33,000 per day thereafter less a 5% third-party commission. In all cases, the rate for the duration of the time charter will average $33,000 per day. For purposes of revenue recognition, the time charter contract is reflected on a straight-line basis at approximately $33,000 per day for 35 to 37.5 months in accordance with U.S. GAAP.

(14) We recently extended the time charter for an additional 35 to 37.5 months at a rate of $37,000 per day less a 5% third-party commission. The new charter commenced on July 10, 2008, following the expiration of the previous charter.

                        Q2 2008 Dividend Announcement

The Company's Board of Directors declared a second quarter 2008 dividend of $1.00 per share payable on or about August 29, 2008 to all shareholders of record as of August 15, 2008. As previously announced, the Company plans to declare quarterly dividends to shareholders by each February, May, August and November, in amounts substantially equal to its available cash from operations during the previous quarter, less cash expenses for that quarter (principally vessel operating expenses and debt service) and any reserves the Board of Directors determines the Company should maintain. These reserves may cover, among other things: drydocking, repairs, claims, liabilities and other obligations, interest expense and debt amortization, acquisitions of additional assets and working capital. The Q2 2008 dividend of $1.00 equates to an annualized yield of 6.3% based on the closing price of Genco Shipping & Trading's common stock as of July 29, 2008 at $63.27.

John C. Wobensmith, Chief Financial Officer, commented, "Genco's strong quarterly results are testament to the sizeable earnings power of the fleet. During the quarter, we remained true to our objective of becoming the industry bellwether and acquired nine high-quality vessels. With the addition of these vessels, Genco has expanded its fleet approximately 345% on a net tonnage basis since going public in July 2005. During the quarter, we also completed a $204 million equity offering, underscoring the ongoing support we have received from the capital and banking markets as we execute our growth strategy. Going forward, we intend to continue to seek opportunities to consolidate the industry in a manner that meets our strict earnings and cash flow criteria as well as return on capital hurdles. Complementing this focus, we intend to continue to draw upon our significant time charter coverage to distribute sizeable dividends to shareholders."

                    About Genco Shipping & Trading Limited

Genco Shipping & Trading Limited transports iron ore, coal, grain, steel products and other drybulk cargoes along worldwide shipping routes. Genco Shipping & Trading Limited currently owns a fleet of 30 drybulk vessels consisting of five Capesize, seven Panamax, four Supramax, six Handymax and eight Handysize vessels, with an aggregate carrying capacity of approximately 2,150,000 dwt. After the expected delivery of 11 vessels the Company has agreed to acquire, Genco Shipping & Trading Limited will own a fleet of 41 drybulk vessels, consisting of 12 Capesize, eight Panamax, four Supramax, six Handymax and 11 Handysize vessels, with an aggregate carrying capacity of approximately 3,516,000 dwt. .

                         Conference Call Announcement

Genco Shipping & Trading Limited announced that it will hold a conference call on Thursday, July 31, 2008 at 8:30 a.m. Eastern Time, to discuss its 2008 second quarter financial results. The conference call and a presentation will be simultaneously webcast and will be available on the Company's website, http://www.GencoShipping.com. To access the conference call, dial (888) 204-4610 or (913) 312-1300 and enter passcode 1470749. A replay of the conference call can also be accessed through August 14, 2008 by dialing (888) 203-1112 or (719) 457-0820 and entering the passcode 1470749. The Company intends to place additional materials related to the earnings announcement, including a slide presentation, on its website prior to the conference call.

"Safe Harbor" Statement Under the Private Securities Litigation Reform Act of
                                     1995

This press release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on management's current expectations and observations. Included among the factors that, in our view, could cause actual results to differ materially from the forward looking statements contained in this report are the following: (i) changes in demand or rates in the drybulk shipping industry; (ii) changes in the supply of or demand for drybulk products, generally or in particular regions; (iii) changes in the supply of drybulk carriers including newbuilding of vessels or lower than anticipated scrapping of older vessels; (iv) changes in rules and regulations applicable to the cargo industry, including, without limitation, legislation adopted by international organizations or by individual countries and actions taken by regulatory authorities; (v) increases in costs and expenses including but not limited to: crew wages, insurance, provisions, repairs, maintenance and general and administrative expenses; (vi) the adequacy of our insurance arrangements; (vii) changes in general domestic and international political conditions; (viii) changes in the condition of the Company's vessels or applicable maintenance or regulatory standards (which may affect, among other things, our anticipated drydocking or maintenance and repair costs) and unanticipated drydock expenditures; (ix) the number of offhire days needed to complete repairs on vessels and the timing and amount of any reimbursement by our insurance carriers for insurance claims including offhire days; (x) the Company's acquisition or disposition of vessels; (xi) the fulfillment of the closing conditions under, or the execution of customary additional documentation for, the Company's agreements to acquire a total of 11 drybulk vessels; and other factors listed from time to time in our public filings with the Securities and Exchange Commission, including, without limitation, the Company's Annual Report on Form 10-K for the year ended December 31, 2007 and its reports on Form 10-Q and Form 8-K. The timing and amount of purchases under the Company's share repurchase program will be determined by management based upon market conditions and other factors. Purchases may be made pursuant to a program adopted under Rule 10b5-1 under the Securities and Exchange Act. The program does not require the Company to purchase any specific number or amount of shares and may be suspended or reinstated at any time in the Company's discretion and without notice. Repurchases will be subject to restrictions under the Company's existing credit facility. Our ability to pay dividends in any period will depend upon factors, including the limitations under our loan agreements, applicable provisions of Marshall Islands law and the final determination by the Board of Directors each quarter after its review of our financial performance. The timing and amount of dividends, if any, could also be affected by factors affecting cash flows, results of operations, required capital expenditures, or reserves. As a result, the amount of dividends actually paid may vary.

SOURCE Genco Shipping & Trading Limited

CONTACT:
John C. Wobensmith,
Chief Financial Officer,
Genco Shipping & Trading Limited,
+1-646-443-8555

Web site: http://www.gencoshipping.com
(GNK)