Aristides Pittas – Chairman and Chief Executive Officer Tasos Aslidis – Chief Financial Officer and Treasurer

Thank you for standing by, ladies and gentlemen. And welcome to the Euroseas’ Conference Call on the Fourth Quarter 2015 Financial Results. We have with us Mr. Aristides Pittas, Chairman and Chief Executive Officer; and Mr. Tasos Aslidis, Chief Financial Officer of the company. At this time, all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session. (Operator Instructions) I must advise you that the conference is being recorded today, Thursday, February 18, 2016. Please be reminded that the company announced their results with a press release that has been publicly distributed. Before passing the floor to Mr. Pittas, I'd like to remind everyone that in today’s presentation and conference call Euroseas will be making forward-looking statements. These statements are within the meaning of federal securities laws. Matters discussed might be forward-looking statement, which are based on current management expectations that involve risks and uncertainties that may result in such expectations not being realized. I kindly draw your attention to slide number 2 of the webcast presentation which has the full forward-looking statement and the same statement was also included in the press release. Please take a moment to go through the whole statement and read it. I'd now like to pass the floor to Mr. Pittas. Please go ahead sir.

Thank you. Good morning and thank you all for joining us today for our conference call. Together with me is Tasos Aslidis, our CFO. The purpose of today's call is to discuss our financial results for the three ended December 31, 2015 and the full-year. Let's turn to slide three of our presentation for our financial results overview. Let's start with the fourth quarter results. For the fourth quarter of 2015, we reported total net revenues of $8.8 million. Net loss for the period was $3.6 million while net loss attributable to common shareholders was $4 million. The difference being the $0.4 million in dividends paid through our Series B Preferred shareholders. Adjusted net loss attributable to common shareholders for the period was $3 million or $0.36 loss per share basic and diluted. Adjusted EBITDA for the fourth quarter of 2015 was $0.1 million. Looking at the full-year of 2015, we reported total net revenues of $37.7 million. Net loss for the period was $13.7 million, while net loss attributable to common shareholders was $15.3 million. Again, the difference is being $1.6 million, which was dividends paid to our Series B preferred shareholders. Adjusted net loss attributable to common shareholders for the period was $13.9 million or $2.17 loss per share basic and diluted. Adjusted EBITDA for 2015 was $0.2 million. Our CFO, Tasos Aslidis will go over our financials in more detail later on during the presentation. Please turn to slide four to discuss operational highlights. Rates in the containership sector and particularly in the feeder size where we operate declined back to their levels of the beginning of last year from the much higher levels observed during the second and third quarters. Overall the idle fleet is at higher levels compared to a year ago but it is mostly comprised of larger vessels indicating feeders like our ships are in a better position to benefit from increases in demand. Consequently we have been able to fix all our vessels that opened up for charter during the quarter as follows. The Joanna has been fixed for seven to eight months at 7,250 per day. The vessel ballasted from Singapore where it had been idle for about two months in October and November. The Aggeliki has been fixed for 12 months at $7,000 per day with a six month option - charter as option at $9,000 per day. Finally the Captain Costas, has been fixed for three to six months at $6,500 a day. This vessel was also idle from the 5th of December till the 23rd of January, when the employment commenced. Currently, all our containerships are fully employed. The drybulk sector on the other hand is at the worst levels seen over the last 30 years with the BDI breaking its historical low levels. A mix of demand and supply related factors are equally responsible for the low market levels. Looking forward, increased scrapping and increased delays and cancellation of newbuilding orders could provide some foundation for the market to arrest the declines and, perhaps benefit from demand recovery. We do expect though, a challenging market environment throughout 2016 as we will discuss further on. In any event, as our vessels are mainly employed through short-term contracts and index linked charters, albeit at below cost levels for the time being, we should be able to make the most from an increase in freight rates when this materializes. During the quarter we fixed the Monica P for a 25 day charter at $4,500 per day, the effective time charter was $4,000 due to the balanced days. Thereafter, we have fixed the vessel for a 50 to 60 days charter at $2,850 per day. As a reminder our earnings press release today includes the complete updated fleet employment of all our vessels. In the fourth quarter of 2015 and first quarter 2016, we sold four vessels. The containerships Marinos, Despina P and Tiger Bridge and the bulk carrier Aristides NP, all for scrap at a range of $290 to $337 per light weight ton, generating aggregate net proceeds of slightly above $10 million. We had been holding on to these vessels, which had an average age of 24 years in the hope of an improving charter market as technically we could have continued to operate for a few more years. This importantly didn't materialize, so spending the necessary cash to pass them through their special survey did not make economic sense in a period where cash is limited. All vessels have already been delivered. During the fourth quarter of 2015, we had no drydock for any of our vessels. We are in the process of completing the arrangements for taking delivery of the first of our newbuliding vessels and making similar arrangements for the remaining two deliveries we have in 2016 around the middle of the year. For all three vessels, bank financing is in place. The first newbuilding Kamsarmax Xenia will be delivered on 25th of February and will simultaneously enter a time charter for $14,100 per day with the first class charterer for four years. There is an additional option for a fifth year at a slightly higher rate. The second newbuilding the Ultramax Alexandros is scheduled to be delivered sometime in the second quarter of 2016. On slide five you will find our fleet as of 31st of December 2015 that includes the four newbuilding drybulk vessels and the vessels in the water. In total this table shows 16 vessels nine drybulk vessels and seven container vessels. As already mentioned the , Aristides NP has just recently been sold, so the actual number we will now own is 15. On slide six, you can see the Euromar fleet. Our joint venture with Eton Park and Rhône Capital. Euromar has a fleet of 8 intermediate and two handysize container vessels between 1,700 and 3,100 teu and one post-Panamax vessel to 5,600 teu. Euroseas owns 14% of this venture and holds about 3 million in preferred equity and has a further 4 million commitment to be invested as preferred equity as well as at Euromar’s option. Euromar’s cash position at the end of 2015 was about $18.8 million. All Euromar vessels are also currently employed. Let’s move to slide eight for a brief overview of the market. Starting with Bulkers. Weakness in the BDI continued in Q4 and into Q1 2016 as the index moves from 888 points from October to 295 points on February 15 in the continuous drop. In detail the Daily Cape spot rates averaged $8,135 in Q4, Panamax spot rates averaged $4,389 and Supramax spot rates $5,394, but subsequently, dropped to $1,440, $2,677 and $2,580 per day, respectively, by February 15, 2016. One year time charter rates have also dropped significantly and as of February 12, 2016, stood at about $6,100 per day for Capes, $4,650 per day for Panamaxes and $4,400/day for Supramaxes. Secondhand prices declined to multi-year lows dropping to scrap prices level for vessels over 15 years old. No newbuilding orders were placed but there were a few resales by owners who did not have capacity to pay for them or yards which have taken them over. Vis-a-vis sales are at levels of around $19 million for Ultramaxes, $20 million for Kamsarmaxes and $34 million for Capes, but the trend is downwards. For containerships time charter rates in Q4 for vessels below 5,500 teu have dropped further and are in the region of $5,000 to $7,000 with 1,700 teu vessels earning the most. Here also secondhand prices dropped even further and 15 year old vessels are valued at their scrap price. Newbuilding prices were stable however activity was non-existent. The idle fleet rose from about 1 million teu in mid-October 2015 to about 1.35 million teu as of mid-January 2016. However, there seems to be a reversal in this trend during the last couple of weeks. Turning to slide nine, you can review drybulk age profile and delivery schedule. The delivery schedule for drybulk vessels in 2016 stands at a significant 11.9% of the fleet for the full year. It's always a very difficult to quantify how much of the order book will actually get delivered. Since 2009 it's been around 35% of the scheduled order book that has not gotten delivered due to cancellations, conversions or slippage. In 2015, we saw this number jump to 43% due to the extremely low margins. This year we believe that more than 50% of the order book will actually not be delivered. Also, scrapping will hit an multi-year high. For 2017, the drybulk order book stands at 2.9%, a significant drop from 2016. But in no likelihood, this number will arise, not due to new orders, which we don't believe will materialize but due to the slippage of this year. Turn to slide 10. The container delivery schedule at the beginning of 2016 stood at 6.8% and was dominated by the larger vessels. Here again cancellations and slippages will change the original estimate, but much less significantly to the drybulk market. For 2017, the order book increased during last year as many liner orders for larger vessels competing for optimal slot size have pushed this number up and now it stand at 6.2%. Hopefully the retreating market will deter companies from placing new orders and even incentivize them to delay or cancelled pre-agreed orders as we saw Maersk do with some options they had retained. The great majority of the order book is for large ships, but cascading is still happening. We have seen and we continue to see Panamaxes between 3,000 teu to 5,000 teu being displaced by the new larger ships in the longer routes. At the same time, though some of these ships have cascaded down to routes that were served by the 1,000 teu to 3,000 teu ships. However, we have lately seen a stabilization of this process as with cheaper oil and size restrictions that appear are seem as they are putting a break. Please turn to slide 11. Unfortunately the world economy seems to be facing renewed headwinds and sentiment globally is turning more negative than previously. Worldwide uncertain geopolitical and economic trends amid adjustments in commodity and, especially, oil price levels, adjustments of China’s economy, the resulting effects on commodity export economies all these are creating a very volatile market. On the positive front, the declining price of oil should eventually stimulate growth with an increasing demand. Growth in the Eurozone has been revised upwards and growth in emerging markets are expected to be slightly higher this year than in 2015. The Iran nuclear deal removes a significant tension factor in the Middle East and opens up further growth opportunities. China seems to be avoiding a hard landing. In addition to these positives though we have quite a few negatives as well. Syria of course, continues to create instability around the region and is creating problems in Europe through the refugee issue, while it stabilizes the balance with Turkey and Russia. On the purely economics front, a strong USD is a headwind for emerging markets, which do not see the full extent of the oil price decline. Also the Fed’s rate hike, the renminbi’s devaluation, the confusion on the Chinese stock market rules and performance are all causing a global rise in risk aversion. On the longer term negative, we view the aging populations globally, which reduced productive capacity and create problems to pension systems. While growth is expected to remain high in emerging Asia, growth will be lower than expected a year ago. While India should benefit from policy reforms and increased investment, costlier funding will hit the most indebted nations hardest. Finally, political uncertainty in Brazil and the impact of low oil prices in the Middle East are continuous concerns. Slide 12, shows expectations of world GDP according to the IMF and also shipping demand growth. Projected world GDP in 2016 is expected to be 3.4%, revised downwards by 0.2% of the previous quarter. China is still expected by the IMF to grow by 6.3% in 2016, same as last quarter and still at the healthy level, while India is also projected by the IMF to grow by 7.5% in 2015, same to the previous quarter. The U.S. is projected at slightly lower growth of 2.6%, while Brazil is now expected have 3.5 negative growth in '16, down from the early projected negative growth of just 1%. Also Russia has lower projections currently at negative 1% from negative 0.6% in the previous estimate. Much can be seen in the bottom of slide 12 Clarkson's projections point to drybulk growth of 0.8% in '16, following 0% growth in 2015. Containership trade is showing less growth from what was expected during the previous quarter. The current growth of 4% in '16 is now from 5.5% in the previous quarter. For 2017, global growth is expected to pick up a bit and if that happens, demand growth in both drybulk and container trades should also gradually improve. Let's turn to slide 13 to summarize our outlook for the drybulk sector. Market fundamentals for 2016 and 2017 appear very challenging, but should start improving in 2017 because supply adjustments should provide the foundation for the recovery if demand grows at a moderated rate is achieved as largely expected. China remains the main source of drybulk trade growth. Iron ore imports is the commodity with the greatest prospects despite minimal trade growth in 2015 and low expected steel consumption global in 2016. Shutting down, if it happens of local uneconomical mines could boost seaborne imports. Thermal coal consumption is on the decline mainly due to environmental concerns worldwide. But there again Chinese imports which form a miniscule part of Chinese consumption may surprise to the positive if local mines close down. In China, there is some slight upside to be expected for grain imports and finished steel exports. Despite India’s strong coal imports, strong growth, coal imports may not growth as fast as previously expected, due to the effort by the government of Mr. Modi to use India's own developing facilities. Whilst we anticipated charter market improvement probably starting some time in 2017, we believe this will be gradual and cut due also to increase the efficiency of operations and capacity to speed up. Let's turn to slide 14 to discuss the containers market. Here we expect rates to improve '16 and '17 from current levels. We expect the supply/demand balance to be marginally in favour of demand as Europe's economies improve. Still rates remain soft until after the deployment of idle vessels. Continuing ordering of mega vessels from the various alliances, if it happens, will create further worries for 2018 onwards prospects. At present though, ordering is minimal. The order book in the sub-Panamax sector seems to be very light, however, different trading patterns and cascading trends will determine the fate of this market segment as well. Let's turn to slide 16 to view our own drybulk employment schedule. Our drybulk coverage for 2016 currently stands at around 55%, which includes the newbuilding Xenia, but excludes the newbuilding Ultramax vessels. We are continuing the practice of employing our vessels in short terms contracts or index linked charters in anticipation of the market improvement. Let's turn to slide 17 for our containership employment schedule. We currently have 40% coverage in 2016. As we had drybulk vessels our strategy for our containerships has been to employ them on short-term employment in the anticipation of the market improvement. Please turn to slide 18. Eurobulk our manager is continuing to keep our costs low. Our daily costs per vessel for Q4 '15 was in line with our budget and similar to previous years. The graph in this page compares daily cost excluding drydock since 2018 with our peers. Overall, our cost remains amongst the lowest of the public shipping companies. For the fourth quarter of 2015, our operational fleet utilization was 98% and our commercial fleet utilization 83.9%. Let's now turn to slide 19. The left side of this slide shows the evolution of time charter rates of Panamax drybulk ships and containers of 1,700 teu since 2001. Container rates are approaching lows last seen in 2010 and drybulk vessels are at all-time lows. The right hand side of the slide, shows the current vessels values in relation to historical prices. Both drybulk and containership prices are at the lowest levels since during the last 15 years. While shorter term market dynamics may result in even lower prices as many owners are forced to sell either voluntarily due to liquidity issues or by the banks. We believe that we will see a fast improvement once people start to see some light at the end of the tunnel as clearly these valuations do not reflect the long-term earnings capacity of vessels. Assuming that the analyst of IMF are right in predicting slightly stronger global GDP growth and here I have to say that they have overestimated the strength of the global economy quite a few times these last few years. But if that happens we should be on track for our market improvement once the current big order books get depleted within the next couple of years. Because of that, and these extremely low vessel values that we see in the drybulk market, we think that that could present opportunities to slightly modernize our fleet for minimal incremental investment and we are evaluating alternatives to exploit such possibilities should they become available to us. And with that, I want to pass the floor over to our CFO, Tasos Aslidis to take you through our current financials in more detail. Tasos?

Thank you very much Aristides. Good morning from me as well ladies and gentlemen. As usual I will now provide you with a brief overview of our financial results for the three months period and full year ended December 31, 2015. For that, let’s turn first to slide 21 and take a look at our results for the fourth quarter of 2015 in comparison to the same period of last year. I will repeat here some of the same figures that Aristides gave you in the beginning of the presentation. The fourth quarter of 2015, reflects the extremely low level of the drybulk market rates and the low level of the containership rates as well as the lower number of vessels who operated during the quarter, due to the sale of some of our ships. For the fourth quarter of 2015, we reported total net revenues of $8.8 million representing a 23.7% decrease over total net revenues of $11.5 million during the fourth quarter of last year. We reported net loss for the period of $3.6 million and a net loss attributable to common shareholders of $4 million as compared to net loss of $7 million for the fourth quarter of 2014. As Aristides mentioned earlier, the difference between net loss and net loss attributable to common shareholders is $0.4 million in accounts for the dividends we paid to our Series B preferred shares in the fourth quarter of 2015. This preferred divided can be paid out at our option either in cash or in kind and we have elected to pay it in kind for the last 10 quarters. Basic and diluted loss per share attributable to common shareholders for the fourth quarter of 2015 was $0.60 compared to basic and diluted loss per share of $1.28 for the fourth quarter of last year. Excluding the effect on the loss attributable to common shareholders for the quarter of the unrealized gain and realized loss on derivatives, the gain on sale of vessels and impairment loss, the adjusted net loss per share attributable to common shareholders for the quarter ended December 31, 2015 would have been $0.36 per share basic and diluted compared to net loss of $0.67 per share basic and diluted for the fourth quarter of last year. Adjusted EBITDA for the fourth quarter of 2015 was $0.1 million about $0.1 million lower as compared to the same period of 2014. Let’s now turn to the full year of 2015 and look at the highlights on the right side of the slide. For the full year of 2015, we reported total net revenues of $37.7 million, representing a 7.3% decrease over total net revenues of $40.6 million during 2014. We reported a net loss for the period of $13.7 million and a net loss attributable to common shareholders of $15.3 million as compared to a net loss of $17.9 million for the 12 months of 2014. Again the difference between the two losses is $1.6 million of dividends we paid to our Series B preferred shares during 2015. Basic and diluted loss per share attributable to common shareholders for 2015 was $2.39 compared to basic and diluted loss per share of $3.53 in 2014. Excluding the effect on the loss attributable to common shareholders of the unrealized gain and realized loss on derivatives. The gain on sales of vessels and impairment loss, the adjusted net loss per share attributable to common shareholders for 2015 would have been $2.17 as compared to a loss of $2.88 per share for 2014. Adjusted EBITDA for 2015 was $0.2 million increasing from the negative $0.5 million that was recorded during the 12 months of 2014. Let’s now move to slide 22. In this slide we will provide you as usual with our fleet performance for the three periods and full year ended December 31, 2015 again in comparison to the same periods of last year. As usual we have broken down our presentation of fleet utilization in commercial and operational. For the fourth quarter of this year we reported 83.9% commercial utilization rate, a 98.7% operational utilization rate as compared to 93.4% commercial and 99.5% operational for the same periods of last year. Our utilization rate calculation does not include vessels from drydock or schedule repairs during the reporting periods. In the fourth quarter of 2015, we operated on average 13.97 vessels earning on average a time charter rate equivalent of $6,374 per day, representing an 18% decrease compared to the time charter equivalent of $7,823 per vessel per day that we had during the same period of 2014, a period during which we also operated 15 vessels. Total operating expenses, including management fees, G&A, but excluding drydocking costs, were $5,741 per vessel per day for the fourth quarter of 2015 as compared to $6,358 per vessel per day for the same period of last year. Overall we believe we maintain one of the lowest operating cost structures amongst the public shipping companies and we think that this is one of our competitive advantages in the business. Let’s look now at the bottom of this table to our daily cash flow breakeven levels, presented here on a per vessel per day basis. For the fourth quarter of 2015, we reported an operating breakeven level including loan repayments, but before balloon payments of $8,114 per vessel per day as compared to $9,177 per vessel per day during the same period of 2014. Now let's turn our attention to the full year results for 2015 and there we reported 93.9% commercial utilization rate and 99.4% operational utilization rate as compared to 98% commercial and 99.7% operational during 2014. In the full year 2015, we operated on average 14.74 vessels with the time charter equivalent rate of $7,570 per vessel per day, which represents 0.5% increase compared to the time charter equivalent rate of $7,534 per vessel per day that we achieved during the same period of last year, during which we operated 14.6 vessels. Total operating expenses including management fees and G&A, but excluding drydocking costs were $6,071 per vessel per day for the full year 2015 as compared to $6,320 per vessel per day for 2014. Let’s now look again at the bottom of this table to our daily cash flow breakeven level for the period and as we discussed for the full year 2015. You can see that we reported an operating cash flow breakeven level, again including loan repayments, but not balloon repayments of $9,338 per vessel per day as compared to $9,851 per vessel per day for the full year 2014. Let’s move to slide 23. This slide show on the right hand side our cash flow breakeven levels over the next 12 months and on the left side we can see our scheduled debt repayments, including scheduled balloon repayments over the next five years and including our assumed debt that we expect to draw to finance the newbuildings. As you can see from the chart on the left part of the slide, we have scheduled refinanced all of the $10.7 million balloons that were due in 2015 as well as a $3 million balloon that was due in first quarter of 2016. As of today we have only a $6.4 million balloon due in the fourth quarter of 2016 that we plan to refinance within the course of the year. Our loan repayments over the next 12 months amount to approximately $1,600 per vessel per day contribution to our cash flow breakeven level and you can see that figure in the last line of the table on the right part of the slide. This figure excludes total balloon payments of $9.4 million due in 2016 out of which as I mentioned $3 million have already been refinanced. If we make assumptions for the other elements of our cash flow breakeven level like the operating cost, G&A expenses, interest payments, drydocks expenses then we come up with $8,970 per vessel per day as our cash flow breakeven level for 2016 not including balloon repayments. Let’s move to the next slide, slide 24. As usual let me give you in this slide some highlights from our balance sheet as of December 31, 2015. As of the end of the last year end, our total cash was about $19.2 million comprised of about $8.7 million of unrestricted cash and $10.5 million of restricted funds in retention accounts. Earlier this month, we concluded the refinancing of six of our vessels with a $14.5 million loan, releasing about $5 million of the restricted cash and reducing quarterly repayments for the year. Our outstanding debt as of December 31, 2015, stood at $40.5 million and as a result our debt-to-capitalization ratio was about 24% and our net debt to market value of our fleet ratio was about 38%. After the refinancing I mentioned, and that new loan were about to draw to financial one of our newbuildings our debt will be about $56 million on a pro forma basis as of December 31, 2015. A final word on our capital commitments. Our newbuilding program requires us to pay about $118 million of funds over the period of the construction of the vessels. We have already made payments for $32.7 million of our equity contribution towards this newbuilding program. We are scheduling as Aristides mentioned to take delivery of our first newbuilding later this month, which we are financing partly with a $13.8 million loan and partly with equity. The remaining capital expenditure we have will also expect to finance with a combination of debt and equity. And with that let me turn the floor back to Aristides.

Thank you, Tasos. Thanks everybody for listening into this presentation. Do we have any questions?

Okay. Then well we thank everybody for listening in and we'll be back to you in a quarter's time for the Q1 of 2016 results. Thank you everybody.

Thank you everybody.

Thank you very much indeed and with many thanks to both our speakers today. That does conclude the conference. Thank you all for participating. You may now disconnect. Thank you, gentlemen. Thank you all the very best to you.