The marine transportation industry provides the only practicable and cost-effective means of transporting large volumes of basic commodities and finished products over long distances. In 2007, approximately 3.0 billion tons of drybulk cargo were transported by sea, comprising more than one-third of all international seaborne trade.

Until the start of the 1990s, when it was overtaken by the combined steam and coking coal sectors, iron ore was the largest sector of the drybulk trade. It remains, however, the primary cargo of the largest vessels in the drybulk fleet. Used principally as the primary raw material in steel making, iron ore imports are dominated by Europe, Japan, China, South Korea and the United States.

There are two principal types of coal: steam (or thermal) coal and coking (or metallurgical) coal. The main exporters of coal are Australia, South Africa, Russia, Indonesia, United States, Colombia and Canada. The main importers of coal are Europe, Japan, South Korea, Taiwan, India and China. The coking coal market is closely linked to demand from integrated steel makers who use coking coal in blast furnaces to make pig iron which, in turn, is converted into steel.

Minor bulk cargoes include steel products, forest products, agricultural products, bauxite and alumina, phosphates, petcoke, cement, sugar, salt, minerals, scrap metal and pig iron. Minor drybulk cargoes are not a major component of Capesize or Panamax class vessel demand, although Panamax class vessels also transport cargoes such as bauxite, phosphate rock, sulphur, some fertilizers, various other ores and minerals and a few agribulks.

Upon delivery of the last of the Company’s eight contracted newbuilds in May 2010, the fleet will be comprised of five Panamax, five Kamsarmax, seven Post-Panamax and two Capesize class vessels, the aggregate carrying capacity of the Company’s 19 vessels will be 1,759,900 dwt, and the average age of the vessels in the fleet will be 3.2 years.

The Company’s current fleet is comprised of three groups of sister ships, and, upon delivery of its eight scheduled newbuilds, the fleet will be comprised of six groups of sister ships. Each group has been built based upon the same design specifications and, therefore, uses the same parts and equipment.

The Company’s vessels operate worldwide within the trading limits imposed by insurance terms, and the main trade routes traveled are transatlantic voyages from the east coast of South America to Europe; Europe to East Asia; Australia or Indonesia to Japan; and Indonesia or Australia through the Atlantic Ocean to Europe or the Mediterranean.

Vessel operating expenses decreased by 5.3%, or $0.7 million to $12.4 million during the year ended December 31, 2007, from $13.1 million during the year ended December 31, 2006.

Depreciation expense remained constant during the year ended December 31, 2007, at $9.6 million compared to $9.6 million during the year ended December 31, 2006.

Interest expense increased $2.1 million, or 34.4%, to $8.2 million during the year ended December 31, 2007 from $6.1 million during the year ended December 31, 2006.