MCX MC Shipping

MC Shipping Inc. (AMEX: MCX) reported net income of $10,768,645 or $1.22 per share on gross revenue (excluding interest income) of $35,396,519 for the year ended December 31, 2005, compared to a net income of $1,112,379 or $0.13 per share on gross revenue (excluding interest income) of $31,895,393 for the year ended December 31, 2004 (See Appendix 1 for 12 months financial summary). The Company's Earnings Before Interest, income Taxes, Depreciation and Amortization (EBITDA) were approximately $23.7 million, more than double its 2004 EBITDA of approximately $11.1 million. The ratio of EBITDA to interest expense was approximately 5.9 for the year that ended December 31, 2005, compared to approximately 3.2 in 2004. Vessel operating expenses were $13,983,069 for the year 2005 compared to $16,821,562 in 2004. Operating expenses were approximately 40% of revenues as compared to 53% in the prior year. The fleet on-hire performance was 97.6% in 2005, down from 99.4% in 2004. The decrease in on-hire performance was mainly due to the dry-docking of four vessels in 2005. For the quarter ended December 31, 2005, net income was $2,938,272 or $0.33 per share, compared to a net loss of $(583,946) or $(0.07) per share in the last quarter of 2004 (See Appendix 2). Revenues for the quarter were $9,732,400, compared to $7,990,784 recorded in the last quarter of 2004. In January 2006, the Company received appraisals for its wholly owned fleet from leading independent shipbrokers. On this basis, the appraised value of the Company's fully owned fleet as of December 31, 2005 was approximately $174.7 million and the appraised net value of its share in ships where the Company does not have 100% ownership was approximately $9.3 million against the total book value of the Company's vessels and investments of approximately $128.5 million. "The results for 2005 show record profit and outstanding return on equity as an outcome of the strategic plans that commenced in 2004," stated Tony Crawford, the Company's CEO. "The shareholders in MC Shipping should gain further benefits from the new vessels and investments made in 2005 as the full year effect of these works its way through in 2006", continued Crawford. "With our improving balance sheet and stable cash flow we are much stronger than we were a year ago and will continue our efforts to build on these results with further investments to grow the Company. Our strategy to focus on the expanding LPG industry was well timed and this is demonstrated by the increase in our realizable asset value. Absent any unanticipated event, we will continue our earnings growth in 2006," concluded Crawford. Seeking to improve the stock liquidity, MC Shipping Inc. further announces the distribution of a stock dividend of one share of common stock for every twenty shares of common stock owned, rounded up to the nearest multiple of twenty. The record date will be April 14, 2006. The payment date will be April 28, 2006. In continuation of its policy to date, MC Shipping Inc. also announces distribution of the following cash dividend on the below listed stock of the Company in the first quarter of 2006: -0- *T Title of Class of Stock : Common Distribution per Share : 6.25 cents for every share owned, rounded up to the nearest cent. Dividend Payable to Shareholders of Record at the close of business on : April 14, 2006 Distribution Date : April 28, 2006 *T This news release contains forward-looking statements, within the meaning of Section 21E of the Securities Exchange Act of 1934, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. One can generally identify these forward-looking statements because they contain "expect", "believe", "anticipate", "estimate", "confident" and other words that convey a similar meaning. One can also identify these statements as statements that do not relate strictly to historical or current facts. One should understand that it is not possible to predict or identify all factors that could cause actual results to differ from the Company's forward-looking statements. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with respect thereto or any change in events, conditions or circumstances on which any such statement is based. -0- *T Appendix 1 12 months financial summary for the period ended December 31 (US$): 2005 2004 ------------ ------------ Charterhire and Other Income $ 35,396,519 $ 31,895,393 Commission on Charterhire (532,281) (759,673) Vessel Operating Expenses (13,983,069) (16,821,562) Depreciation and dry-dock amortization (8,922,393) (6,573,789) General and Administrative Expenses (2,254,864) (2,577,213) Recognized deferred gain on sale of vessels 4,515,383 - ------------ ------------ Operating Income 14,219,295 5,163,156 Interest Expense (4,018,670) (3,463,491) Interest Income 454,037 156,964 Loss on debt extinguishment - (744,250) Equity in income of associated companies 113,983 - ------------ ------------ Net Income $ 10,768,645 $ 1,112,379 ------------ ------------ Net Income per share $ 1.22 $ 0.13 Average Number of shares outstanding 8,847,195 8,737,627 Shareholders equity $ 40,466,810 $ 30,836,555 Reconciliation of EBITDA to Net Income Net Income $ 10,768,645 $ 1,112,379 Plus: interest expense 4,018,670 3,463,491 Plus: depreciation and amortization 8,922,393 6,573,789 ------------ ------------ EBITDA 23,709,708 11,149,659 ------------ ------------ *T -0- *T Appendix 2 3 months financial summary for the period ended December 31 (US$): 2005 2004 ------------ ------------ Charterhire and Other Income $ 9,732,400 $ 7,990,784 Recognized deferred gain on sale of vessels 1,200,622 Loss on debt extinguishment (1,107,369) Net Income / (Loss) 2,938,272 (583,946) Net Income / (Loss) per share $ 0.33 $ (0.07) *T