Operating Income

Operating income for the three months ended December 31, 2012, was $10.1 million, which included a $12.2 million gain on the sale of a vessel and approximately $2 million of non-recurring fees associated with the UOS acquisition. Excluding the gain and non-recurring fees, operating income was essentially breakeven compared to $5.4 million for the comparable 2011 three month period.

Following the acquisition of United Ocean Services, the Company changed its reportable segments and now states results in six segments. The Company’s gross voyage profit representing the operating results of its six reporting segments was $10.7 million compared to $16.9 million in the 2011 three month period. The comparable results by operating segment are shown below.
 
     

Jones Act
   

Pure Car Truck Carriers
   

Rail- Ferry
   

Dry Bulk Carriers
   

Specialty Contracts
    Other     Total
(All Amounts in Millions)                    

Fourth Quarter 2012
   
Gross Voyage Profit $4.0 $4.6 $0.6 $0.7 $0.3 $0.5 $10.7
 
Depreciation ($0.9)     ($2.4)     ($0.7)     ($1.7)     ($0.5)     $0.0     ($6.2)
Gross Profit $3.1     $2.2     ($0.1)     ($1.0)     ($0.2)     $0.5     $4.5
(After Depreciation)
 

Fourth Quarter

2011
Gross Voyage Profit $0.8 $8.1 $1.5 $3.2 $3.3 $0.0 $16.9
 
Depreciation ($0.4)     ($4.1)     ($1.0)     ($1.3)     ($0.5)     ($0.0)     ($7.3)
Gross Profit $0.4     $4.0     $0.5     $1.9     $2.8     $0.0     $9.6
(After Depreciation)
 

Variance
Gross Voyage Profit $3.2 ($3.5) ($0.9) ($2.5) ($3.0) $0.5 ($6.2)
Depreciation ($0.5)     $1.7     $0.3     ($0.4)     ($0.0)     $0.0     $1.1
Gross Profit $2.7     ($1.8)     ($0.6)     ($2.9)     ($3.0)     $0.5     ($5.1)
 
 

(See below Exhibit 99.2 to reconcile numbers presented above to GAAP figures. With the UOSacquisition, the Company has changed its reportable segment results with all prior periods recasted. SeeExhibit 99.3 to view the updated profile of reporting segments. Additionally, the Company’s 2012 10-Kfiling will provide descriptions of each of the six (6) segments.)
 

Gross voyage profit for the Jones Act segment reflects one month of UOS operating results and improved results from our molten sulphur carrier. Gross voyage profit of the Pure Car Truck Carrier (“PCTC”) segment was lower due to a fewer number of vessels operating in this segment as two International Flag PCTCs were sold in the first quarter of 2012, lower supplemental cargo volumes and higher operating lease costs on two U.S. Flag PCTCs. The results from the Rail-Ferry segment declined due to lower cargo volumes moved during the quarter. The lower results of the Dry Bulk Carrier segment reflect continuing depressed dry bulk market conditions. The Specialty Contracts segment reported a decrease in gross voyage profit due primarily to the expiration of the three operating contracts with the Military Sealift Command (“MSC”), which occurred in the first quarter of 2012, and the re-delivery of the ice-strengthened vessel from its MSC contract in September of 2012. The Company’s other segment reported better results.

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