Edward Coll - Chairman & CEO Anthony Laura - CFO Josh Clarkson - Prosek Partners

Good morning. My name is Crystal and I will be your conference facilitator today. At this time, I would like to welcome everyone to the Pangaea Logistics Solutions Fourth Quarter and Full Year 2015 Earnings Teleconference. Our host for today's call are Mr. Ed Coll, Chairman and Chief Executive Officer; Mr. Anthony Laura, Chief Financial Officer; and Mr. Josh Clarkson of Prosek Partners. Today's call is being recorded and will be available for replay beginning at 11:00 a.m. Eastern Time. The recording can be accessed by dialing 800-585-8367 domestic or 404-537-3406 international and referencing ID number 72750653. All lines are currently muted and after the prepared remarks there will be a live question-and-answer session. [Operator Instructions] It is now my pleasure to turn the floor over to Mr. Josh Clarkson.

Thank you, Crystal and thank you all for joining us for this morning's fourth quarter and full year 2015 earnings teleconference for Pangaea Logistics Solutions. With it today from the company, our Chairman and CEO, Mr. Ed Coll and Chief Financial Officer, Mr. Tony Laura. Before I turn the call over to Ed, I'd like to read the Safe Harbor statements. This conference could contain forward-looking statements within the meanings of the Private Securities Litigation Reform Act of 1995 about Pangaea Logistics Solutions. Forward-looking statements are statements that are not historical facts; such forward-looking statements are based upon the current beliefs and expectations of Pangaea Logistics Solutions management and are subject to risks and uncertainties which could cause the actual results to differ from the forward-looking statements. Such risks are more fully discussed in Pangaea Logistics Solutions filings with the Securities and Exchange Commission. The information set forth herein should be understood in light of such risks. Pangaea Logistics Solutions does not assume any obligations to update the information contained in this conference call. Thank you. Also, please recall that this quarter a supplemental slide presentation that will accompany this call, those slides can be found attached to the 8-K that was filed with last evenings release which is available on the investors section of www.pangaeals.com under company filings or on the SEC's website at sec.gov. Now I would like to turn the call over to Pangaea Logistic Solutions, Chairman and CEO, Mr. Ed Coll. Ed?

Thanks, Josh, and good morning to all of you and thank you for joining us on the call. This morning I will provide an update of operations and the market at large before turning the call over to Tony, our CFO, to provide a more detailed overview of the fourth quarter and full year financials. And then we’ll open up the line for questions. Last evening, and as you can see on slides three and four of the accompanying presentation, we were very pleased to report a net income of $11.3 million for 2015, or $0.48 per share on a pro forma adjusted basis compared to a loss of $12.1 million, or $0.03 per share on a pro forma adjusted basis in 2014. Our unique asset right strategy focused on servicing profitable voyage revenue tied to contracts of affreightment or COAs with a mix of owned, owned and chartered in vessels allows us to minimize the impact of low rates and focus on our core competency of providing logistic solutions to our valued clients. We were served very well by the strategy in 2015 as evidence by our profitable results that made us historically difficult operating environment and so many of our competitors are fretting at a loss. The dramatic improvement in our performance compared to last year was largely attributable to our improved operating margin. As you will see on slide six, our operating margin increased to 7.1% for 2015 from negative 0.63% in 2015, the uptick in our operating margin in terms is driven by lower cost of chartered in vessels from a weak drive off shipping market, optimization of vessel days to minimize cost and risk of losses in a weak market. Decreased bunker cost and performing under fixed price COAs at average rates that are higher…

Thank you, Ed. Turning now to our financials for the fourth quarter and full year which began on slide eight of the presentation. As you can see, revenue for the full year was $287.3 million compared to $398.3 million in 2014. This decline was a result of the number of total shipping days decreasing 17% from 16,952 in 2014 to 14,094 in 2015. Pangaea's revenue for the fourth quarter of 2015 was $55.9 million compared with $103.1 million for the fourth quarter of 2014. This was also driven by a decrease in total shipping days from 4,497 in the fourth quarter of 2014 to 2,475 in the fourth quarter of 2015, a decline of 45%. Further breakdown of our full year revenue shows that voyage revenue which is derived from our COA and other cost of business decreased 23% to $266.7 million in 2014 from $345.2 million in 2014. Meanwhile, charter revenue which is tied to market rate charters decreased 61% in 2015 to $20.7 million from $53 million in 2014. Our full year expenses decline meaningfully more than our revenue leading to a dramatic improvement in margins, specifically voyage expenses declined 34% year-on-year to $125.6 million from $189.5 due predominantly to decreases in voyage days and bunker prices and charter hire expenses decreased 49% year-on-year to $75.9 million from $149.7 million due to the decline in market rates. During the fourth quarter of 2015, both our voyage and charter revenues declined 46% from the fourth quarter of 2014, while voyage expense and charter hire expenses both declined 59% year-on-year. Income from operations was $20.5 million for the full year as compared to a loss from operations of $2.5 million in 2014. As Ed noted earlier this increase is due to lower cost for chartered in vessels, decreased bunker cost…

Thank you, Tony. In 2016 and beyond, we'll continue to focus on the strategy that propelled our strong profitable results in 2015; operating the best-in-class efficiency, mitigating the risk of a low rate environment, controlling cost, selective expanding and adding to our COAs, strategically servicing our specialized market and most importantly utilization for back haul. As you can see in our 2015 results, steadfast adherence to these simple principles should enable future sustainable growth for our company and by extension shareholder value. With that I'll open the call up to your questions.

Thank you all for taking the time to join us this morning, and have a great day.

Thank you. That does conclude the Pangaea Logistics Solutions fourth quarter and full year 2015 earnings teleconference. You may now disconnect.