GPRT.L Regulatory News (GPRT)

Goldenport Holdings Inc.

Athens, 7 March 2012

Final Results for the Year Ended 31 December 2011

Goldenport Holdings Inc. ("Goldenport" or "the Company"), (LSE: GPRT) the international shipping company that owns and operates a fleet of container and dry bulk vessels, today announces the results for the year ended 31 December 2011 reporting a final dividend for 2011 of 4.0 pence per share, which including the interim dividend results in a total dividend for the year of 6.0 pence per share, an increase of 11.1% compared to the 2010 dividend.

Financial Highlights (amounts in '000 except per share data)

§ Revenue of US$ 107,329, +21.7% increase (2010: US$ 88,180)

§ EBITDA of US$ 50,673, +20.1% increase (2010: US$ 42,199)

§ Net Profit of US$ 2,339 compared to Net loss of US$ 152 in 2010

§ Earnings per Share of US$ 0.03 calculated on 91,179,150 shares (2010: (0.00) calculated on 80,215,088 shares)

§ Available cash of US$ 38,018 (31 December 2010: US$ 52,683)

§ Restricted cash of US$ 4,000 (31 December 2010: US$ 10,100)

§ No impairment losses incurred on any vessel of the fleet

§ In full compliance with debt covenants

§ Initial new-building program successfully completed

§ No further capital commitments

§ Final dividend of 4.0 pence per share or £ 3,634 in total (2010 final dividend: 3.6 pence per share)

§ 2.0 pence will be paid in cash and 2 pence will be paid in shares

§ Total dividend for 2011 of 6.0 pence per share, +11.1% increase (2010: 5.4 pence per share)

CEO Statement (amounts in US$'000):

Captain Paris Dragnis, Founder and Chief Executive Officer of the Company commented:

"Shipping remains a vital link in the global economy, but it is also a cyclical business. We are therefore, pleased to report healthy operational results for 2011 despite the continued market volatility over the last twelve months.

During the year, we continued with our fleet renewal and expansion strategy. We completed our initial new-building program with the delivery of four vessels, three bulk carriers and one container vessel, and arranged for the profitable sale of one container vessel and the replacement of its operating days through the acquisition of another younger geared container vessel. Following these developments our fleet expanded to twelve containers and fourteen dry-bulk carriers, out of which nine vessels in total are built after 2009, lowering the average age profile of our fleet while expanding its carrying and revenue generation capacity.

We expect the freight market in the containers and dry-cargo sectors to remain under pressure in 2012. However, the Company's enlarged fleet has 58% of available days in 2012 already fixed under period employment, assuming earliest charter expiration. The remaining of the 2012 available days will be covered by employing the vessels in short-term contracts until the market improves, at which point we shall consider a mixture of medium to longer-term time charter contracts.

As testimony to Goldenport's strength, confidence in the future and commitment to our shareholders, the Board proposed a final dividend of 4.0 pence per share which when added to the interim dividend of 2.0 pence per share provides a full year dividend for 2011 of 6.0 pence which represents an increase of 11.1% compared to the 2010 full year dividend of 5.4 pence per share.

Our Company is in a strong financial condition with net debt to book capitalisation as of 31 December 2011 of only 47% a conservative figure for our industry. We have no issues with our loan covenants and no asset impairment charges. Our total cash balance on 31 December 2011 was US$42,018, after the cash acquisition of the container vessel 'Paris Jr' which we expect to leverage in 2012 releasing cash back to the business. Following the successful completion of our initial new-building program which enlarged our operational fleet, we have no further capital commitments.

We remain cautious given the current market conditions, but we also remain alert to investment opportunities that traditionally arise during weak markets.

I am confident that our strong links with international shipping banks, our well established relationships with major international charterers, our experienced management, our strong balance sheet and our modern fleet will allow us to meet the challenges in the current uncertain markets and facilitate our next renewal and growth phase."

Final Dividend:

The Board of Directors of Goldenport believes it is prudent to maintain a conservative dividend payout ratio but also recognises the needs to reward shareholders who have consistently supported the Company. Therefore the Board proposes a final dividend of 4.0 pence per share in respect of the financial year ending 31 December 2011 (3.6 pence per share final dividend in 2010). Including the interim dividend of 2.0 pence per share already paid, the total dividend for 2011 will be 6.0 pence per share (2010: total dividend was 5.4 per share). 2.0 pence per share of the final dividend will be paid in cash accompanied by 2.0 pence paid in shares, arrangements for which will be mailed to shareholders on or about 3 April 2011. Assuming that the dividend proposal is approved at the AGM that will be held on 11 May 2012, the dividend will be payable on 18 May 2012 to the shareholders on the register as at close of business on 16 March 2012. The ex-dividend date is 14 March 2012.

Compliance with Debt Covenants:

The Company is in full compliance with the covenants of existing bank debt.

Impairment:

No impairment loss has been incurred on any vessels in the fleet. 

Fleet Developments:

New-Building Deliveries

On 18 April 2011 the Company took delivery of the 57,000 DWT geared bulk carrier 'Pisti', which was constructed in Cosco Zhousan shipyard of China.

On 9 May 2011 the Company took delivery of the 93,000 DWT bulk carrier 'D Skalkeas', which was constructed in Jiangsu Yangzijiang Shipbuilding Co. shipyard of China.

On 12 July 2011 the Company took delivery of the 57,000 DWT geared bulk carrier 'Sofia', which was constructed in Cosco Zhousan shipyard of China.

On 25 July 2011 the Company took delivery of the 2,500 TEU geared container vessel 'Erato', which was constructed in Jiangsu Yangzijiang Shipbuilding Co. Ltd, shipyard of China.

Profitable Vessel disposal (amounts in US$ '000)

On 6 December 2011, the company agreed the sale of the 2,986 TEU, 1991-built vessel "Grand Vision", to an unaffiliated third party. The sale was concluded at a net consideration of U.S. $6,168 cash and the vessel was delivered to the new owners on 29 December 2011. The gain resulting from the sale of the vessel was U.S.$349.

Operational vessels acquisition (amounts in US$ '000)

On 15 February 2011, the Company took delivery of the M/V 'Clifton Bridge', a container vessel of 3,720 TEU built in 1988, which was acquired for U.S.$8,100. The vessel was renamed 'Pos Yantian'.

On 27 October 2011, the Company took delivery of the M/V Paris JR, a container vessel of 1,129 TEU built in 1996, which was acquired for U.S.$4,762.

Treasury Shares:

The share capital of the Company consists of 91,288,554 shares of common stock with a nominal value of US$0.01 each. As of 6 March 2012 the Company holds 427,887 shares in treasury; therefore the total number of voting rights in the Company is 90,860,667.

Fleet Forward Coverage: 

The percentage of available days of the fleet already fixed under contracts as of 6 March 2012 assuming the earliest charter expiration is as follows:

(1) Percentage of available days of the fleet fixed under contract as reported on 15 February 2012, being the date of the previous trading update, is given in brackets

2012 Financial Calendar:

Conference Call and Webcast:

The Company's management will hold a conference call today Wednesday 7 March at 2:30 P.M. (BST), 4:30 P.M. (Athens), 9:30 A.M. (EDT), to discuss the results.

Conference Call details:

Participants should dial into the call 10 minutes prior to the scheduled time using the following numbers: 0800-953-0329 (from the UK), 1-866-819-7111 (from the US) or +44 (0)1452-542-301 (all other callers). Please quote "Goldenport Holdings" to the operator.

A telephonic replay of the conference call will be available until 14 March 2012 by dialling 0800-953-1533 (from the UK), 1-866-247-4222 (from the US) or +44 (0)1452-550-000 (all other callers). Access Code: 6906584#

Slides and Audio Webcast:

There will also be a live and then archived webcast of the conference call, accessible through the Goldenport Holdings website (www.goldenportholdings.com). Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

Enquiries

Goldenport:

Christos Varsos, Chief Financial Officer: +30 210 8910 500

John Dragnis, Commercial Director +30 210 8910 500

Investor Relations Co-ordinators:

Capital Link:

Eleni Theodoropoulou - London +44 203 206 1322

Nicolas Bornozis - New York +1 212 661 7566

E-mail: goldenport@capitallink.com

info@goldenport.biz

Market Outlook:

Containers:

At the start of 2011 the improved momentum of the market through the second half of 2010 brought earnings to an acceptable level. With almost all major liner companies announcing profits for 2010, the number of laid up vessels reducing to less than 150 and vessels available for charter at their lowest number for more than three years, market signs were optimistic. By April, 2011 charter rates and asset prices were at their long term averages.

Unfortunately, the world's economic fundamentals did not justify such optimism, with cargo growth stalling at the same time that a large number of new-building vessels were being delivered into the market. Despite "slow steaming" by some operators, moderate levels of scrapping of older ships, and attempts to delay new-building deliveries, there was an imbalance in the supply and demand ratio. Consequently, by the beginning of 2012 freight rates had reduced to those experienced in 2009 and the number of idle vessels increased to 290 vessels, representing 750,000 TEU.

The outlook for this sector depends on the balance of supply and demand. With the demand growth for the container trade in 2012 estimated by industry sources at 7-7.5% and the scheduled supply growth for the container fleet estimated at 9.3%, the outlook for 2012 does not look promising. As the year is developing however it appears supply growth may only reach 8%, due to cancellations of new-building vessels, delays in delivery dates, an increase in the rate of scrapping and the introduction of "super slow steaming" for several post-panamax vessels.

It is important to distinguish between the different size segments that comprise the container new-building statistics. The majority of the new deliveries are for larger ships, post panamax vessels of 6,000 TEU or above and these vessels are largely restricted to finding employment on the East-West trades. Therefore, the adverse effects of the large new-building order-book may not fully impact the charter market for the smaller size vessels (those below 6,000 TEU).

Overall it is expected that 2012 could be a year of opportunity for those owners in a position to make further investments in the container sector, particularly in vessels below 6,000 TEU where the new-building order-book is at lower levels. Secondhand values have not fully realigned to current lower level of earnings but this is expected to happen as the year progresses.

Goldenport by operating in the segment below 6,000 TEU, is well positioned to utilize opportunities as the year develops.

Bulk-Carriers:

For 2012, the dry bulk shipping fleet, following the same pattern as in 2011 is expected to grow further despite the expected accelerated pace of demolition as well as cancellations and potential delays of the existing new-building order-book.

Whilst the supply side of the dry bulk sector will show a large increase, so should demand. As the majority of the total seaborne dry bulk trade is connected with the steel industry (iron ore, coking coal, steel products, scrap, etc) the anticipated growth in steel consumption is expected to be the key driver behind growth in demand in the dry bulk market.

In 2011 global steel production increased by 7% reaching a new high of 1.5 billion tons. For 2012 global steel production is set to continue to grow by at least another 100 million tons (about 6%) with demand from Asian countries leading the way once more. Considering the strong correlation between freight earnings and the steel industry combined with the positive underlying environment in the grain trades the resulting increase in demand for dry bulk vessels will partly offset the expected large increase in supply. Nevertheless, 2012 is expected to be a challenging year for owners of dry bulk tonnage.

Charter rate volatility was a key feature during 2011 (mainly for the Capesize vessels which fluctuated between c. $5,000 and c. $33,000 per day) and this is expected to continue into this year. The Supramax sector on the other hand was less volatile, fluctuating between c. $11,000 and c. $17,000. The spot market (as measured by the BDI) after reaching a 26 year low in early February (647 points on 3rd February 2012) has already bounced back and the derivatives' market view (FFA market) for the rest of the year is relatively positive.

Average freight rates for 2012 are expected to be lower than 2011 but still above operating cost break even levels. The expectation is for the larger size vessels (mainly the Post-Panamax and the Capesize) to experience the most difficult market conditions because of the large volume of newbuilding deliveries expected in these segments. The same is expected to apply for vessel values mainly in the second hand market. Vessel prices are expected to remain under further pressure (after softening by as much as 25% in 2011) due to lack of buying interest from cash-rich owners who feel there is further downside potential in prices and restrictions on the availability of bank financing. In the new-building market contracting activity (which was limited in 2011) is expected to remain weak forcing yards (especially in S. Korea) to further reduce their prices. Overall these conditions may provide real opportunities to companies with strong cash flow and reserves to upgrade their fleet during the course of the year and take full advantage of a recovery in demand in the foreseeable future.

The Company following the delivery of all new-buildings, has more vessels in operation compared to previous periods, which will support revenue generation over the longer term. At the same time Goldenport's bulk carriers' fleet is focused to the Supramax sector which traditionally has been less volatile compared to the larger sizes and has better outlook for the rest of the year.

Summary of Selected Financial and Operating Data:

See Appendices, for Notes on the Summary of Selected Financial and Operating Data, for detailed Fleet Employment profile, for Notes on the Summary of Selected Financial and Operating Data, for forward looking statements and for full set of financial statements.

Financial review (amounts in US$ '000, except the per day data)

Time and Voyage Charter Revenues: Revenues increased by US$ 19,149 or 21.7% to US$ 107,329 for 2011 (2010: US$ 88,180). The main reason for this, was the increase in available days for chartering due to: (i) the delivery of the new build vessels 'Pisti', 'Sofia', 'D Skalkeas' and 'Erato' during 2011, (ii) the full operation for the year of the new build vessels 'Eleni D', 'Sifnos' and 'Milos' that were delivered from their respective yards during the last quarter of 2010, (iii) the full operation of the vessel 'Grand Vision' that contributed partially in 2010, (iv) the full operation of the vessel 'Golden Trader' in 2011 which was acquired in 2010 and (v) the delivery of the second hand vessel 'Pos Yantian', which contributed partially in 2011. The increased days led to the significant increase in revenue although the daily time charter equivalent fell by 11.9% to US$ 11,501 per day (from US$13,058 per day in 2010).

Voyage expenses total: The voyage expenses increased by US$ 1,290 or 22.8% to US$ 6,958 for 2011 (2010: US$ 5,668) mainly due to the increased revenue figure to which commission rates applied.

Vessel operating expenses: Vessel operating expenses increased by US$ 8,960 or 27.6% to US$ 41,402 for 2011 (2010: US$ 32,442). The increase in absolute numbers is attributable to the increase of the fleet.

However, on a per day basis operating expenses decreased by US$ 301 per day or 6.1% to US$ 4,668 per day (2010: US$ 4,969 per day) reflecting the change in mix of the fleet after the sale of older vessels and the delivery of younger more efficient vessels.

General and administrative expenses: The General and administrative expenses decreased by US$ 1,154 or 21.9% to US$ 4,111 (2010: US$ 5,265) although it should be noted that 2010 expenses were inflated due to an out-of-court settlement of a dispute for US$ 1,300.

Depreciation: The vessels' depreciation charge increased by US$ 7,426 or 24.2% to US$ 38,112 for 2011 (2010: US$ 30,686) due to the incremental depreciation of the vessels 'Grand Vision' and 'Golden Trader', acquired in 2010, the delivery of the new-building vessels 'Sifnos', 'Milos', 'Eleni D' in the last quarter of 2010 and the acquisition of the second hand vessels 'Pos Yantian' and 'Paris Jr' and the delivery of the new build vessels 'Pisti', 'Sofia', 'D Skalkeas' and 'Erato' during 2011.

Depreciation of dry-docking costs: Depreciation of dry-docking costs decreased by US$ 3,462 or 39.5% to US$ 5,296 for 2011 (2010: US$ 8,758) mainly due to the renewal of the fleet and the completion of amortization of prior dry-dockings performed in prior years.

Gain from vessel disposals: In 2011 the Company realised US$ 349 of profit from the sale of the vessel 'Grand Vision'; during 2010 the Company realised profit of US$ 868 from the sale of the fully depreciated vessel 'MSC Mekong'.

Loss from cancellation of new building contracts: In 2010 the Company wrote off US$ 353 relating to the cancellation of the Qingshan contracts that was reflected in the 2009 results.

Financing costs: Interest expense increased by US$ 1,790 or 31.7% to US$ 7,430 for 2011 (2010: US$ 5,640), reflecting the net increase of debt due to i) draw-downs of debt in order to finance new-building payments and ii) incremental debt due to the acquisition of the second hand vessels 'Grand Vision', 'Golden-Trader' and 'Pos Yantian'.

Cash and cash equivalents: As of 31 December 2011, the Company had US$ 38,018 of unrestricted cash and cash equivalents (2010: US$ 52,683). The cash balance as of 31 December 2011 includes the proceeds received from the sale of 'Grand Vision' and is after the cash payment for the acquisition of the vessel 'Paris Jr' for which financing will be arranged in 2012. During 2011 the Company completed its initial new building program and currently has no further capital commitments to fund. Incremental cash will be used to fund acquisitions when opportunities arise.

Restricted Cash: The Company as of 31 December 2011 had US$4,000 of restricted cash (2010: US$10,100) representing part of the amount drawn in 2011 for the delivery instalment of the vessel 'D Skalkeas'.

APPENDIX 1:

Fleet Employment Profile

APPENDIX 2:

Notes on Summary of Selected Financial and Operating Data:

(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 a part of our fleet during the period divided by the number of calendar days in the period.

(2) Ownership days are 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) Available days are 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. The shipping industry uses available days to measure the number of days in a period during which vessels should be capable of generating revenues.

(4) Operating days are the number of available days in a period less the aggregate number of days that our vessels are off-hire due to any reason other than scheduled repairs or repairs under guarantee, vessel upgrades or special surveys, 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.

(5) We calculate fleet utilisation by dividing the number of our operating days during a period by the number of our available days during the same period. The shipping industry uses fleet utilisation to measure a company's efficiency in finding employment for its vessels and minimising 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.

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

(7) TCE rates are defined as our time and voyage charter revenues less voyage expenses during a period divided by the number of our available days during the period, which is consistent with industry standards. Voyage expenses include port charges, bunker (fuel oil and diesel oil) expenses, canal charges and commissions. TCE rate is a standard 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 are generally expressed in such amounts.

(8) Net debt to book capitalisation is defined as total debt minus cash (both net of any restricted cash) divided by the carrying amount of vessels and vessels under construction.

APPENDIX 3:

Forward-Looking Statement

Matters discussed in this release may constitute forward-looking statements. Forward-looking statements reflect the current views of Goldenport Holdings Inc. ("the Company") with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts.

The forward-looking statements in this release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in our records and other data available from third parties. Although the Company believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, the Company cannot assure you that it will achieve or accomplish these expectations, beliefs or projections.

Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies and currencies, general market conditions, including changes in charter hire rates and vessel values, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled dry-docking, changes in the Company's operating expenses, including bunker prices, dry-docking and insurance costs, or actions taken by regulatory authorities, potential liability from pending or future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists. The Company does not assume, and expressly disclaims, any obligation to update these forward-looking statements.

This press release is not an offer of securities for sale in the United States. The Company's securities have not been registered under the U.S.Securities Act of 1933, as amended, and may not be offered or sold in the United States or to a U.S. person absent registration pursuant to, or an applicable exemption from, the registration requirements under U.S. securities laws.

APPENDIX 4:

Financial Statements

Goldenport Holdings Inc.

Consolidated Financial Statements

31 December 2011

The consolidated financial statements are presented in US dollars and all financial values are presented and rounded to the nearest thousand ($000), except for the per share information.

INDEPENDENT AUDITORS' REPORT

To the Shareholders of Goldenport Holdings Inc.

We have audited the accompanying financial statements of Goldenport Holdings Inc. and its subsidiaries ("the Group"), which comprise the consolidated statement of financial position as at 31 December 2011 and the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes.

Management's Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards as adopted by the European Union and for such internal controls as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate for the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements presents fairly in all material respects the financial position of the Group as of 31 December 2011, and of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards, as adopted by the European Union.

Ernst & Young (Hellas) Certified Auditors - Accountants S.A.

6 March 2012.

GOLDENPORT HOLDINGS INC.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 December 2011

The accompanying notes 1 to 25 are an integral part of these consolidated financial statements.

GOLDENPORT HOLDINGS INC.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As at 31 December 2011

The accompanying notes 1 to 25 are an integral part of these consolidated financial statements.

GOLDENPORT HOLDINGS INC.

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the year ended 31 December 2011

The accompanying notes 1 to 25 are an integral part of these consolidated financial statements.

GOLDENPORT HOLDINGS INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

For the year ended 31 December 2011

The accompanying notes 1 to 25 are an integral part of these consolidated financial statements.

GOLDENPORT HOLDINGS INC.

NOTES TO THE FINANCIAL STATEMENTS

1. FORMATION, BASIS OF PRESENTATION AND GENERAL INFORMATION

Goldenport Holdings Inc. ('Goldenport' or the 'Company') was incorporated under the laws of Marshall Islands, as a limited liability company, on 21 March 2005. On 5 April 2006 Goldenport Holdings Inc. was admitted in the Official List and started trading at the London Stock Exchange ("LSE").

The address of the registered office of the Company is Trust Company Complex, Ajeltake Road, Ajeltake Island, Majuro, Marshall Islands MH 96960. The address of the Head Office of the Company is Status Center, 41 Athinas Avenue, 166-71 Vouliagmeni, Greece.

Goldenport as at 31 December 2011 is the holding Company for twenty-four intermediate holding companies, each in turn owning a vessel-owning company, as listed in the table below. Also, as at 31 December 2011 Goldenport is the holding Company of a fully owned subsidiary named Goldenport Marine Services, which provides the Company and its affiliates a wide range of shipping services, such as insurance consulting, legal, financial and accounting services, quality and safety, information technology (including software licences) and other administrative activities in exchange for a daily fixed fee, per vessel. Goldenport Marine Services has been registered in Greece under the provisions of Law 89/1967. As at 31 December 2011 Anemone Maritime S.A., the vessel-owning company of the disposed vessel "Grand Vision" (see note 8), has become dormant.

On 24 October 2011, the Group sold 20% of the voting shares in Tuzon Maritime Co., the vessel owning company of Paris JR.

Goldenport and its subsidiaries will be hereinafter referred to as the 'Group'.

The annual consolidated financial statements comprising the financial statements of the Company, its wholly owned subsidiaries, Tuzon Maritime Co, an 80% owned subsidiary (see (a) below) and the proportionally consolidated financial statements of the jointly controlled entity (see (b) below) were authorised for issue in accordance with a resolution of the Board of Directors on 6 March 2012. The shareholders of the Company have the right to amend the financial statements at the Annual General Meeting to be held on 11 May 2012.

a) The subsidiaries of the Company are:

b) Proportionally consolidated the 50% Joint Venture (Note 10)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of preparation: The Group's financial statements have been prepared on a historical cost basis, except for derivative financial instruments that are measured at fair value. The consolidated financial statements are presented in US dollars and all financial values are presented and rounded to the nearest thousand ($000), except for the per share information.

Statement of compliance: The consolidated financial statements as at 31 December 2011 have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.

Basis of Consolidation: The consolidated financial statements comprise the financial statements of the Company and its subsidiaries and the proportionally consolidated financial statements of the jointly controlled entity, listed in note 1. The financial statements of the subsidiaries are prepared for the same reporting date as the Company, using consistent accounting policies. All material inter-company balances and transactions have been eliminated upon consolidation. Subsidiaries are consolidated from the date on which control is transferred to the Group and cease to be consolidated from the date on which control is transferred out of the Group.

Accounting for joint ventures: A joint venture is an entity whose economic activities are jointly controlled by the Group and one or more other ventures in terms of a contractual arrangement. The Group's interest in jointly controlled entities is accounted for by the proportional consolidation method of accounting. Jointly controlled entities have the same reporting date as the Group and apply common accounting policies. The Group combines its share of the joint ventures' individual income and expenses, assets and liabilities and cash flows on a line-by-line basis with similar items in the Group's financial statements.

Use of judgements, estimates and assumptions: The preparation of the Group's consolidated financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities, at the reporting date. However, uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of the asset or liability affected in future. The estimates and assumptions that have the most significant effect on the amounts recognised in the consolidated financial statements, are the following:

Vessels: Management makes estimates in relation to useful lives of vessels considering industry practices. (Vessels have a carrying amount of U.S.$508,807 and U.S.$368,164 as at 31 December 2011 and 2010, respectively). Estimates and assumptions relating to the impairment of vessels are discussed in paragraph (n).

Provisions for doubtful trade receivables: Provisions for doubtful trade receivables are recorded based on management's expected future collectability of the receivables. (Receivables as included in the statement of financial position in trade receivables, have a carrying amount of U.S.$3,055 and U.S.$3,744 as at 31 December 2011 and 2010, respectively).

Insurance Claims: Amounts for insurance claims are provided when amounts are virtually certain to be received, based on the Company's judgement and estimates of independent adjusters as to the amount of the claims. (Insurance claims have a carrying amount of U.S.$571 and U.S.$433 as at 31 December 2011 and 2010, respectively). 

(f) Revenues and Related Expenses: The Group generates its revenues from charterers for the charter hire of its vessels. Vessels are chartered using either a) time charters, where a contract is entered into for the use of a vessel for a specific period of time and a specified daily charter hire rate; or b) voyage charters, where a contract is made in the spot market for the use of a vessel for a specific voyage for a specified charter rate per ton. If a charter agreement exists and collection of the related revenue is reasonably assured, revenue is recognised as it is earned, evenly over the duration of the period of each voyage or time charter. A voyage is deemed to commence upon the completion of discharge of the vessel's previous cargo and is deemed to end upon the completion of discharge of the current cargo. Time-charter revenues arising from chartering the vessels is accounted for on a straight line basis over the term of the charter. Certain time-charter (non-level charters) agreements specify scheduled rate increases/decreases over the charter term. As revenues from time chartering of vessels are accounted for on a straight line basis at the average charter hire rate over the charter periods of such charter agreements, as service is performed, an asset or liability is created.

Deferred revenue represents cash received prior to the reporting date which relates to revenue earned after such date. On time-charters, the charterer as per industry practice pays the revenue related to the specific agreement in advance. Therefore, as at the reporting date the amount of revenue relating to the next financial year that was paid by the charterer is presented in deferred revenue.

Vessel voyage expenses primarily consisting of port, canal and bunker expenses that are unique to a particular charter are paid for by the charterer under time charter arrangements or by the Group under voyage charter arrangements. Furthermore, voyage expenses include commission on income including third party commissions, paid by the Group. The Group defers bunker expenses under voyage charter agreements and charges them to the statement of comprehensive income over the related voyage charter period to the extent revenue has been recognised. Port and canal costs are accounted for on an actual basis. Operating expenses are accounted on an accrual basis.

(g) Foreign Currency Translation: The functional currency of the Company and of the subsidiaries is the U.S. dollar which is also the presentation currency of the Group because the Group's vessels operate in international shipping markets, where the U.S. dollar is the currency used for transactions. Transactions involving other currencies during the year are converted into U.S. dollars using the exchange rates in effect at the time of the transactions. At the reporting dates, monetary assets and liabilities, which are denominated in currencies other than the U.S. dollar, are translated into the functional currency using the year-end exchange rate. Gains or losses resulting from foreign currency transactions are included in foreign currency gain or loss in the consolidated statement of comprehensive income.

(h) Cash and Cash Equivalents: The Group considers highly liquid investments such as time deposits and certificates of deposit with an original maturity of three months or less to be cash equivalents.

(i) Restricted Cash: Certain of the Group's loan agreements may require the Group to deposit funds into a loan retention account in the name of the borrower. The amount deposited is equivalent to the monthly portion of the next capital and interest payment. The amount is not freely available to the Group, and it is used for repaying interest and principal on the loan. As at 31 December 2011, no loan agreements required deposit of funds into a retention account. Restricted cash amounts to U.S.$4,000 as at 31 December 2011 (U.S.$10,100 as at 31 December 2010) and relates to part of the amount drawn for the delivery instalment of MV D Skalkeas, which remains restricted in use from the financing bank. (note 15).

(j) Inventories: Inventories consist of bunkers and are stated at the lower of cost or net realisable value. Cost is determined by the first-in first-out method. Any bunkers remaining on vessels, which are undergoing scheduled dry-docking as at 31 December 2011, are recognised as inventory unless the vessel is to continue under the same time charter. Any bunkers remaining on vessels which are laid up, are also recognised as inventory. One vessel was undergoing scheduled dry-docking and one was laid up as at 31 December 2011.

(k) Trade Receivables: The amount shown as trade receivables at each reporting date includes estimated recoveries from charterers for hire, freight and demurrage billings, net of the allowance for doubtful accounts. Subsequent to initial recognition, trade receivables are recognised and carried at the lower of their original invoiced value and recoverable amount. The carrying amount of receivables is reduced through an allowance account. Impaired debts are derecognized when they are assessed as uncollectible.

(l) Insurance Claims: The Group recognises insurance claim recoveries for insured losses incurred on damages to vessels. Insurance claim recoveries are recorded net of any deductible amounts, at the time the Group's vessels suffer insured damages. They include the recoveries from the insurance companies for the claims, provided the amounts are virtually certain to be received. Claims are submitted to the insurance company, which may increase or decrease the claim amount. Such adjustments are recorded in the year they become known and have not been material to the Group's financial position or results of operation in 2011 and 2010.

(m) Vessels: The vessels are stated at cost, net of accumulated depreciation and any accumulated impairment. Vessel cost consists of the contract price for the vessel and any material expenses incurred upon acquisition of the vessel (initial repairs, improvements, delivery expenses and other expenditures) to prepare the vessel for its initial voyage. Subsequent expenditures for major improvements are also capitalised when it is probable that future economic benefits associated with the improvement will flow to the entity and the cost of the improvement can be measured reliably.

For vessels acquired in the second-hand market and where the Company identifies any intangible assets or liabilities associated with the acquisition of a vessel, the Company allocates the purchase price between the vessel and any identified tangible and intangible assets or liabilities based on their relative fair values. Fair value is determined by reference to market data. The Company determines the fair value of any intangible asset or liability related to time charters assumed, by reference to the market value of the time charters at the time the vessel is acquired. The amount recorded as an asset or liability at the date of vessel delivery is the lowest of: a) the difference between the market value of the vessel on a charter free basis and the vessel's acquisition cost and b) the present value of the difference between the future cash flows of the assumed charter and the future cash flows at the current market rate. If an intangible asset is identified it is recorded as prepaid charter revenue. If an intangible liability is identified it is recorded as deferred revenue. Such assets and liabilities, respectively, are amortized as a reduction of, or an increase in, revenue over the period of the time charter assumed.

The Company records any identified assets or liabilities associated with the acquisition of a vessel at fair value, determined by reference to market data. The Company values any asset or liability arising from the market value of assumed time charters as a condition of the original purchase of a vessel at the date when such vessel is initially deployed on its charter. The value of the asset or liability is based on the difference between the current fair value of a charter with similar characteristics as the time charter assumed and the net present value of contractual cash flows of the time charter assumed, to the extent the vessel capitalized cost does not exceed its fair value without a time charter contract. When the present value of contractual cash flows of the time charter assumed is greater than its current fair value, the difference is recorded as imputed prepaid revenue. When the opposite situation occurs, the difference is recorded as imputed deferred revenue. Such assets and liabilities are amortized as a reduction of, or an increase in, revenue, respectively, during the period of the time charter assumed.

The cost of each of the Group's vessels is depreciated beginning when the vessel is ready for its intended use, on a straight-line basis over the vessels' remaining economic useful life, after considering the estimated residual value. Management estimates the useful life of new vessels at 25 years, which is consistent with industry practice. Acquired second-hand vessels are depreciated from the date of their acquisition over their remaining estimated useful life. The remaining useful life of the Group's vessels, other than those fully depreciated, is between 1 and 25 years. A vessel is derecognised upon disposal or when no future economic benefits are expected from its use. Any gain or loss arising on derecognition of the vessel (calculated as the difference between the net disposal proceeds and the carrying amount of the vessel including any unamortised portion of dry-docking) is included in the statement of comprehensive income in the year the vessel is derecognised.

From time to time the Group's vessels are required to be dry-docked for inspection and re-licensing at which time major repairs and maintenance that cannot be performed while the vessels are in operation are generally performed. The Group capitalises the costs associated with dry-docking as they occur by adding them to the cost of the vessel and amortises these costs on a straight-line basis over 2.5 years, which is generally the period until the next scheduled dry-docking. In the cases where the dry-docking takes place earlier than 2.5 years since the previous one, the carrying amount of the previous dry-docking is derecognised. In the event of a vessel sale, the respective carrying value of dry-docking costs is derecognised together with the vessel's carrying amount at the time of sale.

At the date of acquisition of a second hand-vessel or upon completion of construction of a new built vessel, management estimates the component of the cost that corresponds to the economic benefit to be derived until the next scheduled dry-docking of the vessel under the ownership of the Group, and this component is depreciated on a straight-line basis over the remaining period to the estimated dry-docking date.

(n) Impairment of vessels: The Group's vessels are reviewed for impairment in accordance with IAS 36, "Impairment of Assets." Under IAS 36, the Group assesses at each reporting date whether there is an indication that a vessel may be impaired. If such an indication exists, the Group makes an estimate of the vessel's recoverable amount. Any impairment loss of the vessel is assessed by comparison of the carrying amount of the asset to its recoverable amount. Recoverable amount is the higher of the vessel's fair value as determined by independent marine appraisers less costs to sell and its value in use.

If the recoverable amount is less than the carrying amount of the vessel, the asset is considered impaired and an expense is recognised equal to the amount required to reduce the carrying amount of the vessel to its then recoverable amount.

The calculation of value in use is made at the individual vessel level since separately identifiable cash flow information is available for each vessel. In developing estimates of future cash flows, the Group makes assumptions about future charter rates, vessel operating expenses, and the estimated remaining useful lives of the vessels.

The projected net operating cash flows are determined by considering :

i) the time charter equivalent revenues from existing time charters for the fixed fleet days and an estimated daily time charter equivalent for the unfixed days based on average historical 10 year rates for six months time charter for each type of our bulk carrier vessels and one year time charter for each type of our container vessels over the remaining estimated useful life of each vessel,

ii) an average increase of 4% per annum on charter revenues,

iii) cash inflows were considered net of brokerage, and

iv) expected outflows for scheduled vessels' maintenance and vessel operating expenses were determined assuming an average annual inflation rate of 3%.

The net operating cash flows are discounted using the Weighted Average Cost of Capital of each vessel owning company to their present value as at the date of the financial statements. 

Historical average six-month and one-year time charter rates used in our impairment test exercise are in line with our overall chartering strategy, especially in periods/years of depressed charter rates. The historical averages reflect the full operating history of vessels of the same type and particulars with our operating fleet and they cover at least a full business cycle.

The average annual inflation rate applied for determining vessels' maintenance and operating costs approximates current projections for global inflation rate for the remaining useful life of our vessels.

Effective fleet utilization is assumed at 95%, after taking into consideration the periods each vessel is expected to undergo the scheduled maintenance (dry-docking and special surveys). These assumptions are in line with the Group's historical performance and the expectations for future fleet utilization under our current fleet deployment strategy.

No impairment loss was identified or recorded for the years ended 31 December 2011 and 2010 and the Group has not identified any other facts or circumstances that would require the write down of vessel values under the current market conditions.

The impairment test exercise is highly sensitive on variances in the time charter rates and fleet effective utilization. Consequently, a sensitivity analysis was performed by assigning possible alternative values to these two significant inputs, which indicated that there is no impairment of individual long lived assets.

However, there can be no assurance as to how long charter rates and vessel values will remain at their current levels. Charter rates may remain at depressed levels for some time which could adversely affect our revenue and profitability, and future assessments of vessel impairment.

(o) Long-term debt: Long-term debt is initially recognised at the fair value of the consideration received net of issue costs directly attributable to the borrowing. After initial recognition, long-term debt is subsequently measured at amortised cost using the effective interest method. Amortised cost is calculated by taking into account any issue costs, and any discount or premium on settlement.

A financial liability is derecognized when the obligation under the liability is discharged or cancelled or expired. Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognized in profit or loss.

(p) Borrowing costs: Borrowing costs on loans specifically used to finance the construction, or reconstruction of vessels are capitalised to the cost of that asset during the construction period.

(q) Derivative financial instruments and hedging: The Group uses derivative financial instruments such as interest rate swaps and foreign currency forwards to hedge its risks associated with interest rate and foreign exchange rates fluctuations respectively. Such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently remeasured at fair value. Derivatives are carried as assets when the fair value is positive and as liabilities when the fair value is negative.

The fair value of interest rate swap and foreign currency forward contracts is determined through valuation techniques.

None of the Group's derivatives have been designated as hedging instruments, therefore gains or losses arising from changes in the fair value of the derivatives are taken to the statement of comprehensive income.

(r) Segment Reporting: The Group reports financial information and evaluates its operations by charter revenues and not by other factors such as (i) the length of ship employment for its customers, i.e. spot or time charters; or (ii) type of vessel. Management, including the chief operating decision maker, reviews operating results solely by revenue per day and operating results of the fleet and thus, the Group has determined that it operates under one reportable segment. Furthermore, when the Group charters a vessel to a charterer, the charterer is free to trade the vessel worldwide and, as a result, the disclosure of geographic information is impracticable. Revenue from the Group's largest client amounted to U.S.$36,888 for the year ended 31 December 2011 (2010: U.S. $35,466).

(s) Finance income: Finance income is earned from the Group's short term deposits and is recognised on an accrual basis.

(t) Leases: Leases of vessels where the Group does not transfer substantially all the risks and benefits of ownership of the vessel are accounted for as operating leases. Lease income on operating leases is recognized on a straight line basis over the lease term and classified under revenue.

(u) Share incentive plan: All share based compensation provided to Directors and Senior Management for their service is included in 'General and administrative expenses' of the Consolidated Statement of Comprehensive Income. The fair value of the employees' services received in exchange for the Company's restricted shares is accrued and recognized as an expense in the year of grant. Upon issuance of the relevant shares the total number of shares and their value is separately reflected in the Consolidated Statement of Changes in Equity.

(v) Share-based payment transactions: Employees and Directors of the Group receive remuneration also in the form of share-based payment transactions, whereby employees and directors render services as consideration for equity instruments (equity-settled transactions).

The cost of equity-settled transactions is recognized, together with a corresponding increase in other capital reserves in equity, over the period in which performance and/or service conditions are fulfilled. The cumulative expense recognized for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Group's best estimate of the number of equity instruments that will ultimately vest. The income statement expense or credit for a period represents the movement in cumulative expense recognized as at the beginning and the end of that period and is recognized in administrative expenses of the consolidated statement of comprehensive income.

The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.

(w) Share Capital: Ordinary shares are classified as equity. Incremental costs directly attributed to the issue of new shares are recognized in equity as deductions from proceeds.

(x) Treasury Stock: Own equity that is reacquired (treasury shares) is recognised at cost and deducted from equity. No gain or loss is recognised in the statement of comprehensive income on the purchase, sale, issue or cancellation of the Group's own equity instruments. Any difference between the carrying amount and the consideration, if reissued is recognised in share premium. Voting rights related to the treasury shares are nullified for the Group and no dividends are allocated to them respectively.

(y) Provisions: Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where the Group expects some or all of a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the statement of comprehensive income net of any reimbursement.

(z) Changes in accounting policy and disclosures: The Group has adopted the following new and amended IFRS and IFRIC interpretations as of 1 January 2011 which had no impact on the accounting policies, financial position or performance of the Group:

·; IFRIC 14Prepayments of a Minimum Funding Requirement (Amended)

·; IFRIC 19Extinguishing Financial Liabilities with Equity Instruments

·; IAS 24Related Party Disclosures (Amended)

·; IAS 32Classification on Rights Issues (Amended)

·; Improvements to IFRSs (May 2010)

In May 2010, the IASB issued its third omnibus of amendments to its standards, primarily with a view to removing inconsistencies and clarifying wording. There are separate transitional provisions for each standard.

Amendments resulting from Improvements to IFRSs to the following standards and interpretations did not have any impact on the accounting policies, financial position or performance of the Group:

·; IFRS 3 Business Combinations:

·; IFRS 7 Financial Instruments - Disclosures:

·; IAS 1 Presentation of Financial Statements:.

·; IAS 27 Consolidated and Separate Financial Statements: