FreeSeas Inc. Announces 2008 Fourth Quarter and Year End Financial Results

FreeSeas Inc., a transporter of dry bulk cargoes through the ownership and operation of a fleet of seven Handysize vessels and two Handymax vessels, yesterday announced financial results for its fourth quarter and year ended December 31, 2008.

Mr. Ion Varouxakis, President and CEO of FreeSeas, stated, `We are particularly pleased to report strong results for the year ended December 31, 2008, a transformational year for our Company. During 2008 we grew our fleet from five to nine vessels, lowered the average age of our fleet and secured frontloaded charters. We decided not to enter into newbuilding contracts or engage in a chartering policy of spot only coverage or long period charter at unsustainably high rates, opting instead to adopt a balanced chartering strategy.The Company’s focus in the smaller and versatile Handysize market provides for distinct competitive advantages over the larger dry bulk segments. Our vessels can transport a wider array of cargo, access a larger number of ports due to their shallow draft and onboard crane equipment, and have historically achieved greater charter rate stability. The worldwide Handysize fleet has been shrinking over the last few months, as scrapping of over-age tonnage has far outweighed newbuilding deliveries. As a result, over the last few weeks Handysize rates have outperformed those of larger vessels. We are optimistic that this trend will continue, which will in turn greatly increase the earning potential of our fleet.

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