HispanicBusiness

Vessel Operating Expenses
Vessel operating expenses increased 6.2%, or $5.4 million, to $92.8 million in the nine months ended September 30, 2012, from $87.4 million in the nine months ended September 30, 2011. The increase is mainly attributable to the increased average number of vessels in our fleet during the nine months ended September 30, 2012 compared to the same period of 2011. This overall increase was offset in part by the lower average daily operating cost per vessel of $5,924 for the nine months ended September 30, 2012 compared to $6,220 for the nine months ended September 30, 2011 (excluding vessels on lay-up).

Depreciation & Amortization
Depreciation & Amortization includes Depreciation and Amortization of Deferred Dry-docking and Special Survey Costs.

Depreciation
Depreciation expense increased 37.6%, or $28.8 million, to $105.4 million in the nine months ended September 30, 2012, from $76.6 million in the nine months ended September 30, 2011. The increase in depreciation expense was due to the increased average number of vessels in our fleet (with higher cost base) during the nine months ended September 30, 2012 compared to the same period of 2011.

Amortization of Deferred Dry-docking and Special Survey Costs
Amortization of deferred dry-docking and special survey costs decreased 8.7%, or $0.4 million, to $4.2 million in the nine months ended September 30, 2012, from $4.6 million in the nine months ended September 30, 2011. During the nine months ended September 30, 2011, we had written-off the remaining unamortized balances of deferred dry-docking and special survey costs of $0.6 million related to two of our vessels, as their new dry-docking was performed before the initially scheduled dates.

General and Administrative Expenses
General and administrative expenses increased 8.6%, or $1.2 million, to $15.2 million in the nine months ended September 30, 2012, from $14.0 million in the same period of 2011. The increase was mainly the result of increased fees of $1.6 million to our Manager, due to the increase in the average number of vessels in our fleet, which were partially offset by a reduction of various general and administrative expenses recorded in the nine months ended September 30, 2012 compared to the same period of 2011.

Other Operating Expenses
Other Operating Expenses includes Voyage Expenses

Voyage Expenses
Voyage expenses increased by $2.1 million, to $10.0 million in the nine months ended September 30, 2012, from $7.9 million in the nine months ended September 30, 2011. The increase was the result of increased commissions to our Manager, due to the increase in the average number of vessels in our fleet and the increase in the commission on gross charter hires to our Manager, to 1.0% from 0.75%, effective January 1, 2012, as well as increased other voyage expenses due to the increase in the average number of vessels in the nine months ended September 30, 2012 compared to the same period of 2011.

Interest Expense and Interest Income
Interest expense increased by 63.5%, or $24.9 million, to $64.1 million in the nine months ended September 30, 2012, from $39.2 million in the nine months ended September 30, 2011. The change in interest expense was due to the increase in our average debt by $520.6 million, to $3,276.5 million in the nine months ended September 30, 2012, from $2,755.9 million in the nine months ended September 30, 2011, as well as the increased average LIBOR payable on interest under our credit facilities in the nine months ended September 30, 2012 compared to the nine months ended September 30, 2011. Furthermore, the financing of our newbuilding program resulted in $3.7 million of interest being capitalized, rather than such interest being recognized as an expense, for the nine months ended September 30, 2012 compared to $12.9 million of capitalized interest for the nine months ended September 30, 2011.