Adjusted EBITDA Reconciliation:
Euroseas Ltd. considers Adjusted EBITDA to represent net earnings before interest, income taxes, depreciation, amortization, gain / loss on derivatives and amortization of deferred revenues from above or below market time charters acquired. Adjusted EBITDA does not represent and should not be considered as an alternative to net income or cash flow from operations, as determined by United States generally accepted accounting principles, or U.S. GAAP, and our calculation of Adjusted EBITDA may not be comparable to that reported by other companies. Adjusted EBITDA is included herein because it is a basis upon which we assess our financial performance and liquidity position and because we believe that it presents useful information to investors regarding a company's ability to service and/or incur indebtedness. The Company's definition of Adjusted EBITDA may not be the same as that used by other companies in the shipping or other industries.
Euroseas Ltd. Reconciliation of Net income / (loss) to Adjusted net income / (loss) (All amounts expressed in U.S. Dollars - except share data and per share amounts) Three Months Three Months Ended Ended Year Ended Year Ended December 31, December 31, December 31, December 31, 2011 2012 2011 2012 ------------ ------------ ------------ ------------Net income / (loss) 1,104,346 (2,018,003) 1,115,989 (13,198,741) ------------ ------------ ------------ ------------Unrealized (gain)/ loss on derivatives, net (294,776) (423,509) 650,853 (1,057,929) ------------ ------------ ------------ ------------Unrealized loss on trading securities 31,194 - 235,750 - ------------ ------------ ------------ ------------Realized (gain) / loss on trading securities - - - (20,373) ------------ ------------ ------------ ------------Realized loss on derivatives 296,068 424,771 847,270 1,695,331 ------------ ------------ ------------ ------------Amortization of the fair value of charters acquired - - (1,318,211) - ------------ ------------ ------------ ------------Loss on sale of vessel - - - 8,568,234 ------------ ------------ ------------ ------------Adjusted net income/ (loss) 1,136,832 (2,016,741) 1,531,651 (4,013,478) ------------ ------------ ------------ ------------Adjusted net income/(loss) per share, basic 0.04 (0.04) 0.05 (0.10) ------------ ------------ ------------ ------------Weighted average number of shares, basic 31,867,856 45,265,155 31,794,381 38,950,100 ------------ ------------ ------------ ------------Adjusted net income/(loss) per share, diluted 0.04 (0.04) 0.05 (0.10) ------------ ------------ ------------ ------------Weighted average number of shares, diluted 31,902,950 45,265,155 31,846,080 38,950,100 ============ ============ ============ ============
