===============================================================================

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                              --------------------

                                    FORM 10-Q
(Mark One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

                  For the quarterly period ended March 31, 2007

                                       OR


[ ]  TRANSITION  REPORT  PURSUANT  TO SECTION  13 OR 15(d) OF THE  SECURITIES
     EXCHANGE ACT OF 1934


                    For the transition period from        to

                              --------------------

                        Commission File Number 000-51366


                            EAGLE BULK SHIPPING INC.
             (Exact name of Registrant as specified in its charter)

Republic of the Marshall Islands                             98-0453513
(State or other jurisdiction of                           (I.R.S. Employer
incorporation or organization)                           Identification No.)

                              477 Madison Avenue
                           New York, New York 10022
                    Address of Principal Executive Offices

       Registrant's telephone number, including area code: (212) 785-2500

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                                  YES  [X]     NO  [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check
one):

Large accelerated Filer [ ]  Accelerated Filer  [X]  Non-accelerated Filer  [ ]

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act).

                                  YES  [ ]     NO  [X]
   Indicate the number of shares outstanding of each of the issuer's classes
               of common stock, as of the last practicable date.

               Common Stock, par value $0.01 per share 41,713,820
                     shares outstanding as of May 9, 2007.

================================================================================

                                                                              1
<PAGE>

                                TABLE OF CONTENTS
                                ------------------

                                                                           Page
                                                                           ----

PART I       FINANCIAL INFORMATION
Item 1.       Financial Statements
                   Consolidated Balance Sheets as of March 31, 2007
                   (unaudited) and December 31, 2006........................ 3

                   Consolidated Statements of Operations (unaudited)
                   for the three-months ended March 31, 2007 and 2006....... 4

                   Consolidated Statement of Stockholders' Equity
                   (unaudited) for the three-months ended
                   March 31, 2007........................................... 5

                   Consolidated Statements of Cash Flows (unaudited)
                   for the three-months ended March 31, 2007
                   and 2006................................................. 6

              Notes to Consolidated Financial Statements.................... 7

Item 2.       Management's Discussion and Analysis of Financial Condition
                   and Results of Operations................................15

Item 3.       Quantitative and Qualitative Disclosures about Market Risks...30

Item 4.       Controls and Procedures.......................................31

PART II       OTHER INFORMATION
Item 1.       Legal Proceedings.............................................32
Item 1A.      Risk Factors..................................................32
Item 2.       Unregistered Sales of Equity Securities and Use of Proceeds...32
Item 3.       Defaults upon Senior Securities...............................32
Item 4.       Submission of Matters to a Vote of Security Holders...........32
Item 5.       Other Information.............................................32
Item 6.       Exhibits......................................................32
              Signatures....................................................33


                                                                              2

<PAGE>

Part 1:  FINANCIAL INFORMATION
Item 1:  Financial Statements

                            EAGLE BULK SHIPPING INC.
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>

                                                                                March 31, 2007     December 31, 2006
                                                                                ---------------    ------------------
                                                                                           (Unaudited)
 <S>                                                                             <C>                       <C>
 ASSETS:
 Current Assets:
    Cash .......................................................................   $118,995,212        $22,275,491
    Accounts Receivable.........................................................        852,690            616,205
    Prepaid Charter Revenue.....................................................      2,660,000          3,740,000
    Prepaid Expenses............................................................      1,018,155          1,020,821
                                                                                ----------------   ----------------
  Total Current Assets..........................................................    123,526,057         27,652,517
 Advances for Vessel Acquisition ...............................................     23,475,897                 --
    Vessels and Vessel Improvements, net .......................................    485,487,389        502,141,951
 Advances for Vessel Construction ..............................................     51,013,960         25,190,941
 Restricted Cash................................................................      6,124,616          6,524,616
 Deferred Drydock Costs, net of Accumulated Amortization of $1,084,092
  at March 31, 2007, and $809,109 atDecember 31, 2006...........................      1,662,316          1,937,299
 Deferred Financing Costs, net of Accumulated Amortization of $334,323
  at March 31, 2007 and $276,311 atDecember 31, 2006............................      2,313,090          2,406,839
 Other Assets ..................................................................      1,763,161          2,936,804
                                                                                ----------------   ----------------
 Total Assets...................................................................   $695,366,486       $568,790,967
                                                                                ================   ================
 LIABILITIES & STOCKHOLDERS' EQUITY
 Current Liabilities:
 Accounts Payable...............................................................     $2,585,423         $1,650,159
 Accrued Interest...............................................................        882,475            800,683
 Other Accrued Liabilities......................................................      1,911,760          1,717,124
 Unearned Charter Hire Revenue..................................................      3,172,897          2,713,060
                                                                                ----------------   ----------------
  Total Current Liabilities.....................................................      8,552,555          6,881,026
 Long-term Debt.................................................................    265,624,561        239,974,820
 Other Liabilities..............................................................         45,411            359,180
                                                                                ----------------   ----------------
 Total Liabilities..............................................................    274,222,527        247,215,026
 Commitment and Contingencies                                                                --                 --
 Stockholders' Equity:
 Preferred Stock, $.01 par value, 25,000,000 shares authorized, none issued.....             --                 --
 Common shares, $.01 par value, 100,000,000 shares authorized,
  41,713,820 shares issued and outstanding as of March 31, 2007
  and 35,900,000 shares issued and outstanding as
  of December 31, 2006, respectively                                                    417,138            359,000
 Additional Paid-In Capital.....................................................    474,765,843        364,574,877
 Retained Earnings (net of cumulative dividends declared of
  $104,699,500 at March 31, 2007 and $86,390,500 at
  December 31, 2006)............................................................    (55,756,772)       (45,935,560)
 Accumulated Other Comprehensive Income.........................................      1,717,750          2,577,624
                                                                                ------------------ ----------------
  Total Stockholders' Equity....................................................    421,143,959        321,575,941
                                                                                ------------------ ----------------
 Total Liabilities and Stockholders' Equity.....................................   $695,366,486       $568,790,967
                                                                                ================== =================

                The accompanying notes are an integral part of these Consolidated Financial Statements.
</TABLE>

                                                                              3
<PAGE>

                            EAGLE BULK SHIPPING INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                            Three Months Ended
                                                 -----------------------------------------
                                                   March 31, 2007       March 31, 2006
 <S>                                                      <C>                   <C>
 Revenues, net of Commissions....................     $26,908,532          $23,790,052

 Vessel Expenses.................................       6,245,898            4,704,997
 Depreciation and Amortization...................       5,790,631            4,819,582
 General and Administrative Expenses.............       1,643,820              985,479
 Non-cash Compensation Expense...................       3,259,223              752,686
 Gain on Sale of Vessel..........................       (872,568)                   --
                                                 -----------------    -----------------
    Total Operating Expenses.....................      16,067,004           11,262,744
                                                 -----------------    -----------------
 Operating Income................................      10,841,528           12,527,308
 Interest Expense................................       3,152,125            2,066,351
 Interest Income.................................       (798,385)            (331,544)
                                                 -----------------    -----------------
    Net Interest Expense.........................       2,353,740            1,734,807
                                                 -----------------    -----------------
 Net Income......................................    $  8,487,788         $ 10,792,501
                                                 =================    =================
 Weighted Average Shares Outstanding :
 Basic...........................................      37,450,578           33,150,000
 Diluted.........................................      37,480,914           33,150,106

 Per Share Amounts:

 Basic Net Income................................          $ 0.23               $ 0.33
 Diluted Net Income..............................          $ 0.23               $ 0.33
 Cash Dividends Declared and Paid................          $ 0.51               $ 0.57

                   The accompanying notes are an integral part
                  of these Consolidated Financial Statements.

</TABLE>

                                                                              4
<PAGE>

                            EAGLE BULK SHIPPING INC.
           CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (UNAUDITED)
                    FOR THE THREE-MONTHS ENDED MARCH 31, 2007

<TABLE>
<CAPTION>
                                                Additional                                                Other         Total
                                     Common      Paid-In                                  Accumulated  Comprehensive Stockholder's
                         Shares      Shares      Capital     Net Income   Cash Dividends    Deficit       Income       Equity
                        ----------  --------   ------------  -----------  -------------- ------------   -----------  -------------

<S>   <C>               <C>         <C>        <C>           <C>           <C>           <C>            <C>           <C>
Balance at December
  31, 2006............  35,900,001  $359,000   $364,574,877  $40,454,940   $(86,390,500) $(45,935,560)  $2,577,624    $321,575,941
Comprehensive Income:
   Net Income.........          --        --             --    8,487,788             --     8,487,788           --       8,487,788
   Net Change in
    Unrealized Gains
    on Derivatives....          --        --             --           --             --            --     (859,874)       (859,874)
                                                                                                                      ------------
Comprehensive Income...         --        --             --           --             --            --           --       7,627,914
Issuance of Common
  Shares, net of
  issuance costs......   5,813,819    58,138    106,931,743           --             --             --          --     106,989,881
Cash Dividends........          --        --             --           --    (18,309,000)  (18,309,000)          --     (18,309,000)
Non-cash Compensation..         --        --      3,259,223           --             --             --          --       3,259,223
Balance at March
  31, 2007............. 41,713,820  $417,138   $474,765,843  $48,942,728  $(104,699,500) $(55,756,772)  $1,717,750    $421,143,959
                        ========== =========   ============  ===========  ============== =============  ==========    ============

                        The accompanying notes are an integral part of these Consolidated Financial Statements.

</TABLE>

                                                                              5
<PAGE>

                            EAGLE BULK SHIPPING INC.
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                   (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                                Three Months Ended
                                                                                          March 31, 2007   March 31, 2006
                                                                                         ---------------  ----------------
<S>                                                                                             <C>               <C>
 Cash Flows from Operating Activities:
 Net Income..............................................................................   $8,487,788       $10,792,501
 Adjustments to Reconcile Net Income to Net Cash provided by Operating Activities:
 Items included in net income not affecting cash flows:
Depreciation.............................................................................    5,515,648         4,697,471
Amortization of Deferred Drydocking Costs................................................      274,983           122,111
Amortization of Deferred Financing Costs ................................................       58,012            32,950
Amortization of Prepaid and Deferred Charter Revenue.....................................    1,080,000           937,000
Non-cash Compensation Expense............................................................    3,259,223           752,686
Gain on Sale of Vessel...................................................................    (872,568)                --
 Changes in Operating Assets and Liabilities:
Accounts Receivable......................................................................    (236,485)           (51,145)
Prepaid Expenses.........................................................................        2,666        (1,269,690)
Accounts Payable.........................................................................      496,342         1,412,309
Accrued Interest.........................................................................       81,792             7,275
Accrued Expenses.........................................................................      194,636           (41,327)
Drydocking Expenditures..................................................................            --       (1,464,473)
Unearned Charter Hire Revenue............................................................      459,837          (178,020)
                                                                                         --------------   ---------------
 Net Cash Provided by Operating Activities...............................................   18,801,874        15,749,648
 Cash Flows from Investing Activities:
Advances for Vessel Acquisition.......................................................... (23,475,897)                --
Advances for Vessel Construction......................................................... (25,787,282)                --
Proceeds from Sale of Vessel.............................................................   12,011,482                --
                                                                                         --------------   ---------------
 Net Cash Used in Investing Activities................................................... (37,251,697)                --

 Cash Flows from Financing Activities:
Issuance of Common Stock.................................................................  110,171,870                --
Equity Issuance Costs....................................................................  (2,743,067)                --
Bank Borrowings..........................................................................   38,089,741                --
Repayment of Bank Debt................................................................... (12,440,000)                --
Decrease in Restricted Cash..............................................................      400,000                --
Deferred Financing Costs.................................................................           --            (1,530)
Cash Dividends........................................................................... (18,309,000)       (18,895,500)
                                                                                         --------------   ---------------
 Net Cash Provided by/(Used in) Financing Activities.....................................  115,169,544       (18,897,030)

 Net Increase/(Decrease) in Cash.........................................................   96,719,721        (3,147,382)
 Cash at Beginning of Period.............................................................   22,275,491        24,526,528
                                                                                         --------------   ---------------
 Cash at End of Period................................................................... $118,995,212      $ 21,379,146
                                                                                         ==============   ===============
 Supplemental Cash Flow Information:
Cash paid during the period for Interest (including Capitalized interest
  of $375,845 in 2007 and Commitment Fees)...............................................   $3,485,585        $2,025,940

                        The accompanying notes are an integral part of these Consolidated Financial Statements.

</TABLE>


                                                                              6
<PAGE>

                            EAGLE BULK SHIPPING INC.
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)


Note 1.  Basis of Presentation and General Information

     The accompanying consolidated financial statements include the accounts of
Eagle Bulk Shipping Inc. and its wholly-owned subsidiaries (collectively, the
"Company"). The Company is engaged in the ocean transportation of dry bulk
cargoes worldwide through the ownership and operation of dry bulk vessels. The
Company's fleet is comprised of Handymax bulk carriers and the Company operates
its business in one business segment.

     The Company is a holding company incorporated in 2005, under the laws of
the Republic of the Marshall Islands and was a wholly owned subsidiary of Eagle
Ventures LLC, a Marshall Islands limited liability company ("Eagle Ventures").
Eagle Ventures is owned by affiliates of Kelso & Company, L.P. ("Kelso"),
members of management, a director, and outside investors. Eagle Ventures has
sold the majority of its holdings in the Company. Eagle Ventures currently owns
approximately 0.3% of the Company's outstanding common stock.

     The Company is the sole owner of all of the outstanding shares of the
Marshall Islands incorporated wholly-owned subsidiaries listed below. The
primary activity of each of these subsidiaries is the ownership of a vessel.

<TABLE>
<CAPTION>

-----------------------------------------------------------------------------------------
 Company                            Owner of           dwt.   Built   Date Acquired
 -------                            Vessel            ------  ------  ----------------
                                    ------
<S>                                <C>               <C>      <C>    <C>
 Cardinal Shipping LLC............. Cardinal          55,408   2004   April 18, 2005
 Condor Shipping LLC............... Condor            50,296   2001   April 29, 2005
 Falcon Shipping LLC............... Falcon            50,296   2001   April 21, 2005
 Griffon Shipping LLC.............. Griffon           46,635   1995   June 1, 2005
 Harrier Shipping LLC.............. Harrier           50,296   2001   April 19, 2005
 Hawk Shipping LLC................. Hawk I            50,296   2001   April 26, 2005
 Heron Shipping LLC................ Heron             52,827   2001   December 1, 2005
 Jaeger Shipping LLC............... Jaeger            52,248   2004   July 7, 2006
 Kestrel Shipping LLC.............. Kestrel I         50,326   2004   June 30, 2006
 Kite Shipping LLC................. Kite              47,195   1997   May 9, 2005
 Merlin Shipping LLC............... Merlin            50,296   2001   October 26, 2005
 Osprey Shipping LLC............... Osprey I          50,206   2002   August 31, 2005
 Peregrine Shipping LLC............ Peregrine         50,913   2001   June 30, 2005
 Shikra Shipping LLC............... Shikra *          41,096   1984   April 29, 2005
 Sparrow Shipping LLC.............. Sparrow           48,225   2000   July 19, 2005
 Tern Shipping LLC................. Tern              50,200   2003   July 3, 2006
 Shrike Shipping LLC............... Shrike            53,343   2003   April 24, 2007
 Skua Shipping LLC................. Skua              53,350   2003   Expected June 2007
 Kittiwake Shipping LLC............ Shrike            53,146   2002   Expected June 2007
 Crowned Eagle Shipping LLC........ Crowned Eagle     56,000   2008   Expected November 2008
 Crested Eagle Shipping LLC........ Crested Eagle     56,000   2009   Expected February 2009
 Golden Eagle Shipping LLC......... Golden Eagle      56,000   2010   Expected January 2010
 Imperial Eagle Shipping LLC....... Imperial Eagle    56,000   2010   Expected February 2010
----------------------------------------------------------------------------------------------
         * The vessel SHIKRA was sold on February 27, 2007.
</TABLE>

     The operations of the vessels are managed by a wholly-owned subsidiary of
the Company, Eagle Shipping International (USA) LLC, a Marshall Islands limited
liability company.

                                                                              7
<PAGE>

     The following table represents certain information about the Company's
revenue earning charters, as of March 31, 2007, and charters for vessels
committed for delivery between April and June 2007:


<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------
                         Delivered to                                                Daily Time
 Vessel                  Charterer             Time Charter Expiration (1)      Charter Hire Rate
 ------                  ---------------       ----------------------------     ------------------
 <S>                     <C>                   <C>                                   <C>
 Cardinal ((2))..........April 19, 2005        March 2007 to June 2007               $26,500
 Condor ((3))............March 19, 2007        May 2009 to August 2009               $20,500
 Falcon..................April 22, 2005        February 2008 to June 2008            $20,950
 Griffon ((4)) ..........March 18, 2007        March 2009 to May 2009                $20,075
 Harrier ((5))...........April 21, 2005        March 2007 to June 2007               $23,750
 Hawk I (6)..............April 28, 2005        March 2007 to June 2007               $23,750
 Heron ((7)).............December 11, 2005     December 2007 to February 2008        $24,000
 Jaeger ((8))............July 7, 2006          April 2007 to June 2007               $18,550
 Kestrel I ((9)).........July 1, 2006          December 2007 to April 2008           $18,750
 Kite ((10)).............April 18, 2006        March 2007 to May 2007                $14,750
 Merlin ((11))...........October 26, 2005      October 2007 to December 2007         $24,000
 Osprey I ((1)(2)).......September 1, 2005     July 2008 to November 2008            $21,000
 Peregrine  .............December 16, 2006     December 2008 to February 2009        $20,500
 Shikra ((1)(3)).........September 10, 2006    Vessel sold on February 2007          $14,800
 Sparrow (1(4))..........January 27, 2007      December 2007 to February 2008        $24,000
 Tern ((1)(5))...........July 3, 2006          December 2007 to April 2008           $19,000
 New Acquisitions:
 Shrike ((1)(6)).........April 25, 2007        April 2009 to June 2009               $24,600
 Skua ((1)(7))...........Expected June 2007    May 2009 to July 2009                 $24,200
 Kittiwake ((1)(8))......Expected June 2007    May 2008 to July 2008                 $30,400
---------------------------------------------------------------------------------------------------
</TABLE>

   (1)  The date range provided represents the earliest and latest date on which
        the charterer may redeliver the vessel to the Company upon the
        termination of the charter.
   (2)  Upon completion of the current charter the CARDINAL will enter a new
        time charter at $28,000 per day for 11 to 13 months.
   (3)  Upon completion of the current charter in March 2007, the CONDOR
        commenced a new time charter at $20,500 per day for 26 to 29 months. The
        charterer has an option to extend the charter period by 11 to 13 months
        at a time charter rate of $22,000 per day.
   (4)  Upon completion of the current charter in March 2007, the GRIFFON
        commenced a new time charter at $20,075 per day for 24 to 26 months.
   (5)  The charter for the HARRIER has been renewed at $24,000 per day
        commencing in June 2007 for 24 to 27 months.
   (6)  The charter for the HAWK I has been renewed at $22,000 per day
        commencing in April 2007 for 24 to 26 months.
   (7)  Upon completion of the current charter, the HERON commences a new time
        charter with a rate of $26,375 per day for 36 to 39 months.
   (8)  Upon completion of the current charter, the JAEGER commences a new time
        charter with a rate of $27,500 per day for 12 to 14 months. The charter
        rate may reset at the beginning of each month based on the average time
        charter rate for the Baltic Supramax Index, but in no case less than
        $22,500 per day.
   (9)  The charterer of the KESTREL I has an option to extend the charter
        period by 11 to 13 months at a daily time charter rate of $20,000 per
        day.
   (10) Upon conclusion of the current charter, the KITE commences a new time
        charter at $21,000 per day for 26 to 29 months.
   (11) Upon conclusion of the current charter, the MERLIN commences a new time
        charter for 36 to 39 months. The charter rate is $27,000 per day for the
        first year, $25,000 per day for the second year, and $23,000 per day for
        the third year. Revenue will be recorded on a straight-line basis at
        $25,000 per day for 36 to 39 months.
   (12) The charterer of the OSPREY I has an option to extend the charter period
        by up to 26 months at a time charter rate of $25,000 per day.

                                                                              8
<PAGE>


   (13) The SHIKRA was sold on February 27, 2007.
   (14) Upon completion of the current charter in January 2007, the SPARROW
        commenced a new time charter at a base rate of $24,000 per day for 11 to
        13 months with a profit share of 30% of up to the first $3,000 per day
        over the base rate.
   (15) The charterer of the TERN has an option to extend the charter period by
        11 to 13 months at a time charter rate of $20,500 per day.
   (16) The Company took delivery of the SHRIKE on April 24, 2007 and the vessel
        was immediately delivered to the charterer at time charter rate of
        $24,600 per day for 24 to 26 months. The charterer has an option to
        extend the charter period by 12 to 14 months at a daily time charter
        rate of $25,600.
   (17) The Company is expected to take delivery of the SKUA in June 2007 and
        the vessel will deliver to the charterer at time charter rate of $24,200
        per day for 23 to 25 months. The charterer has an option to extend the
        charter period by 11 to 13 months at a daily time charter rate of
        $25,200.
   (18) The Company is expected to take delivery of the KITTIWAKE in June 2007
        and the vessel will deliver to the charterer at time charter rate of
        $30,400 per day for 11 to 13 months. The charter rate may reset at the
        beginning of each month based on the average time charter rate for the
        Baltic Supramax Index, but in no case less than $24,400 per day.


         The following table represents certain information about the Company's
charterers which individually accounted for more than 10% of the Company's
gross time charter revenue during the periods indicated:

                           % of Time Charter Revenue
                           -------------------------
                                                  Three Months Ended
                                    --------------------------------------------
 Charterer                              March 31, 2007           March 31, 2006
 ---------                              --------------           --------------

 Charterer A........................             14.8%                    16.2%
 Charterer B........................             23.9%                    15.7%
 Charterer C........................                --                    14.9%
 Charterer D........................             16.2%                    10.2%
 Charterer H........................             11.0%                       --

--------------------------------------------------------------------------------

         The accompanying unaudited consolidated financial statements have been
prepared in accordance with accounting principles generally accepted in the
United States, and the rules and regulations of the Securities and Exchange
Commission ("SEC") which apply to interim financial statements. Accordingly,
they do not include all of the information and footnotes normally included in
consolidated financial statements prepared in conformity with accounting
principles in the United States. They should be read in conjunction with the
consolidated financial statements and notes thereto included in the Company's
2006 Annual Report on Form 10-K.

         The accompanying unaudited consolidated financial statements include
all adjustments (consisting of normal recurring adjustments) that management
considers necessary for a fair presentation of its consolidated financial
position and results of operations for the interim periods presented. The
results of operations for the interim periods are not necessarily indicative of
the results that may be expected for the entire year.

Note 2.  Vessels

      Vessel and Vessel Improvements

         At March 31, 2007, the Company's fleet consisted of a total of 15 dry
bulk vessels acquired at a total cost of $517,696,284. These costs consist of
the contracted purchase price of $524,877,903, $447,881 in additional costs
relating to the acquisition of the vessels, and adjustments of $7,629,500 in
net prepaid charter revenue relating to the assumption of time charters
associated with certain of the acquired vessels. The Company has also
capitalized $1,248,855 of costs relating to improvements for those vessels.

                                                                              9
<PAGE>

Vessel and vessel improvement costs have been depreciated from the date of
their acquisition through their remaining estimated useful life. Depreciation
expense for the three month periods ended March 31, 2007 and 2006 were
$5,515,648 and $4,697,471 respectively. Accumulated depreciation as of March
31, 2007 and December 31, 2006 were $33,457,750 and $31,415,604, respectively.

         During the three month period ended March 31, 2007, the Company
entered into several vessel purchase agreements and a vessel sale agreement:

         -- It has agreed to purchase 3 modern Supramax vessels, the SHRIKE,
         SKUA and KITTIWAKE, for a total contract price of $138,700,000. The
         Company has placed $23,440,000 in deposits for the three vessels and
         the balance of the purchase prices will be paid as each vessel is
         delivered between April and June 2007. The deposit amount is recorded
         under Advances for Vessel Acquisition. As of March 31, 2007, the
         Company has also incurred $35,897 in additional costs relating to the
         acquisition of the three vessels.

         -- It sold the SHIKRA, a 1984-built Handymax vessel to an unrelated
         third party for $12,525,000. The Company incurred total expenses of
         $513,518 relating to the sale. It has recorded a gain on sale of
         $872,568.

         -- The Company, through its subsidiaries, entered into two vessel
         newbuilding contracts for the construction of two 56,000 deadweight
         ton vessels, to be named CROWNED EAGLE and CRESTED EAGLE, which are
         expected to be delivered in November 2008 and February 2009,
         respectively. The contract price for each vessel is 3.83 billion
         Japanese yen or approximately $33,200,000 after giving effect to
         currency hedges. The Company has placed deposits for the two
         newbuilding vessels which amount to an equivalent $25,265,936 which is
         recorded under Advances for Vessel Construction. The Company will pay
         an additional 10% of each vessel's contract price three months prior
         to delivery and the balance upon delivery. As of March 31, 2007, the
         Company had placed deposits totaling an equivalent $50,064,054 for 4
         newbuilding vessels on order.

         The deposits for the newbuilding vessels have been funded through
         borrowings from its credit facility and the borrowing costs are
         capitalized and recorded under Advances for Vessel Construction.
         During the three-month period ended March 31, 2007, the Company
         incurred interest costs of $473,314 and legal, insurance and technical
         supervision fees of $48,032. Amortization of financing costs for these
         borrowings is also capitalized and this amount for the three-month
         period ended March 31, 2007 was $35,737. As of March 31, 2007, the
         Company had capitalized interest costs of $768,631 and legal,
         insurance and technical supervision fees of $181,275

Note 3.  Long-Term Debt

         During the three months ended March 31, 2007, the Company borrowed an
additional $38,089,741 under its $500,000,000 revolving credit facility. Of
these borrowings $25,649,741 was used to fund the deposits and part of the
capitalized financing costs for the two newbuilding vessels which were
contracted for construction during the quarter, and $12,440,000 was used to
partly fund the deposits for the three vessels which were agreed to be acquired
in the quarter.

         During the three months ended March 31, 2007, the Company used
$12,440,000 from the gross proceeds of the sale of the SHIKRA to repay
borrowings from the revolving credit facility.

         At March 31, 2007, the Company's debt consisted of $265,624,561 in
borrowings under the revolving credit facility.

         The facility bears interest at the rate of 0.75% to 0.85% over LIBOR,
depending upon the amount of debt drawn as a percentage of the value of the
Company's vessels. The Company pays on a quarterly basis a commitment fee of
0.25% per annum on the undrawn amount of the facility. At March 31, 2007, the
Company had a remaining undrawn capacity of $234,375,439 available to borrow
for future acquisitions of dry bulk vessels.

                                                                             10
<PAGE>


         At March 31, 2006, the Company's debt consisted of $140,000,000 in
borrowings under the original $330,000,000 revolving credit facility.

         Interest Expense, exclusive of capitalized interest, consists of:

                                                       Three Months ended
                                                       ------------------
                                              March 31, 2007     March 31, 2006
                                              --------------     --------------
 Loan Interest...............................     $2,948,754         $1,841,290
 Commitment Fees.............................        145,359            192,111
 Amortization of Deferred Financing Costs....         58,012             32,950
                                              ---------------    ---------------
 Total Interest Expense......................     $3,152,125         $2,066,351
                                              ===============    ===============


Interest-Rate Swaps

         The Company has entered into interest rate swaps to effectively
convert a portion of its debt from a floating to a fixed-rate basis. The swaps
are designated and qualify as cash flow hedges.

         During the three-months ended March 31, 2007, the Company entered an
interest rate swap contract for a notional amount of $25,776,443. This contract
matures in March 2010. On this contract, exclusive of applicable margin, the
Company will pay 4.90% fixed-rate interest and receive floating-rate interest
amounts based on three-month LIBOR settings. The Company has four other
interest rate swap contracts as follows:

         -     Notional amount of $100,000,000 with a fixed interest rate of
               4.22% and maturity in September 2010

         -     Notional amount of $30,000,000 with a fixed interest rate of
               4.54% and maturity in September 2010

         -     Notional amount of $84,800,000 with a fixed interest rate of
               5.24% and maturity in September 2009

         -     Notional amount of $25,048,118 with a fixed interest rate of
               4.74% and maturity in September 2011

The Company records the fair value of the interest rate swaps as an asset or
liability on its balance sheet. The effective portion of the swap is recorded
in accumulated other comprehensive income. Accordingly, $1,763,161 and
$2,936,804 has been recorded in Other Assets in the Company's financial
statements as of March 31, 2007 and December 31, 2006, respectively.

Foreign Currency Swaps

         The Company has entered into foreign exchange swap transactions to
hedge foreign currency risks on its capital asset transactions (vessel
newbuildings). The swaps are designated and qualify as cash flow hedges. At
December 31, 2006, the Company had outstanding foreign currency swap contracts
for notional amounts aggregating 4.386 billion Japanese yen swapped into
equivalent US $42,310,465. During the three months ended March 31, 2007, the
Company entered into foreign exchange swap transactions to hedge the Japanese
yen exposure into US dollars for the purchase price in Japanese yen of two
new-build vessels which are expected to be delivered to the Company in November
2008 and February 2009. During the quarter, the Company swapped a total of 7.66
billion in Japanese yen currency exposure into equivalent US $66,386,179. After
giving effect to the deposits paid for the newbuildings, at March 31, 2007, the
Company had outstanding foreign currency swap contracts for notional amounts
aggregating 8.982 billion Japanese yen swapped into equivalent US $83,430,708.

         The Company records the fair value of the currency swaps as an asset
or liability in its financial statement. The effective portion of the swap is
recorded in accumulated other comprehensive income. Accordingly, an amount of
$45,411 and $359,180 has been recorded in Other Liabilities in the accompanying
financial statements as of March 31, 2007 and December 31, 2006, respectively.

Note  4.  Commitments and Contingencies

 Vessel Technical Management Contracts

         The Company has technical management agreements for each of its
vessels with independent technical managers. The Company paid an average
monthly technical management fees of $8,851 per vessel during the three months
ended March 31, 2007.


                                                                             11
<PAGE>

Operating Lease

         In December 2005, the Company entered into a lease for office space.
The lease is secured by a Letter of Credit backed by cash collateral of
$124,616 which amount is recorded under Restricted Cash. The Letter of Credit
amounts decline to zero at the conclusion of the lease. At March 31, 2007, the
future minimum commitments under lease obligations for office space are as
follows:

 2007..........................................................   $ 188,000
 2008..........................................................     250,000
 2009..........................................................     250,000
 2010..........................................................     250,000
 2011..........................................................      63,000
                                                               -------------
 Total......................................................... $ 1,001,000
                                                               =============


Note 5.  Earnings Per Common Share

         The computation of basic earnings per share is based on the weighted
average number of common shares outstanding during the period. In March 2006,
the Company granted options to purchase 56,666 shares under the 2005 Stock
Incentive Plan. In January 2007, under the same plan, the Company granted
options to purchase 537,334 of the Company's common shares. Diluted net income
per share gives effect to the aforementioned stock options using the treasury
stock method.

--------------------------------------------------------------------------------
                                                   Three Months Ended
                                                   ------------------
                                         March 31, 2007         March 31, 2006
                                         --------------         ---------------

 Net Income/(Loss).....................      $8,487,788            $10,792,501
 Weighted Average Shares - Basic.......      37,450,578             33,150,000
 Dilutive effect of stock options .....          30,336                    106
 Weighted Average Shares - Diluted.....      37,480,914             33,150,106
 Basic Earnings Per Share..............           $0.23                  $0.33
 Diluted Earnings Per Share............           $0.23                  $0.33

-------------------------------------------------------------------------------


Note 6.  Non-cash Compensation

         For the three-month periods ended March 31, 2007 and 2006, the Company
recorded non-cash compensation charges of $3,259,223 and $752,686,
respectively. The expense for the three month period ended March 31, 2007
includes $3,137,812 in non-cash, non-dilutive charges relating to profits
interests awarded to members of the Company's management by the Company's
former principal shareholder Eagle Ventures LLC, and a non-cash amount of
$121,411 which relates to the fair value of the stock options granted in
January 2007 to certain directors of the Company and members of management
under the 2005 Stock Incentive Plan (see Note 8).

         On January 9, 2007, Eagle Ventures, sold 7,202,679 shares of the
Company's common stock in a secondary offering. The Company did not receive any
proceeds from this offering. Based on the discretion of the compensation
committee of Eagle Ventures, exercised in accordance with the Fifth LLC
Agreement, Eagle Ventures redeemed and retired the common interests held by
certain members in full liquidation of the common interests held such members.
The remaining proceeds received by Eagle Ventures will be retained until a
future distribution is determined to be made by the compensation committee of
Eagle Ventures. Future distributions of the remaining cash proceeds, and the
proceeds received from the sale of the 127,778 shares of our common stock held
by Eagle Ventures, will be distributed to the remaining members of Eagle
Ventures, including an affiliate of Kelso and members of our

                                                                             12
<PAGE>

management that hold profits interests, in accordance with the Fifth LLC
Agreement, as modified by the permitted discretion of the compensation
committee of Eagle Ventures reflected in an amendment to the Fifth LLC
Agreement.

         These non-cash, non-dilutive charges relate to profits interests
awarded to members of the Company's management by the Company's former
principal shareholder Eagle Ventures LLC. These profits interests will dilute
only the interests of the owners of Eagle Ventures LLC, and will not dilute the
direct holders of the Company's common stock. The non-cash compensation charge
is being recorded as an expense over the estimated service period in accordance
with SFAS No. 123(R). The non-cash compensation charges have been based on the
fair value of the profits interests which were "marked to market" at the end of
each reporting period. The impact of any changes in the estimated fair value of
the profits interests was recorded as a change in estimate cumulative to the
date of change. The expense relating to the profits interests is now fixed.
There will be no charges in future periods. The Company's Financial Statements
for the year ended December 31, 2006 on Form 10-K includes a more detailed
description of these profits interests.

Note 7.  Capital Stock

Common  Shares

         On January 9, 2007, the Company's then principal shareholder, Eagle
Ventures, sold 7,202,679 of the Company's common shares in a secondary
offering. The Company did not receive any proceeds from this offering.

         On March 6, 2007, the Company sold 5,400,000 of the Company's common
shares at a price to the public of $18.95 per share raising gross proceeds of
$102,330,000. On March 20, 2007, the Company raised an additional $7,841,870 in
gross proceeds from the underwriter's exercise of their over-allotment option
for the sale of 413,819 of the Company's common shares.

         The Company incurred fees and expenses of $3,181,989 relating to the
sales of its common shares.

Dividends

         The Company's current policy is to declare quarterly dividends to
shareholders in February, April, July and October. Payment of dividends is
limited by the terms of certain agreements which the Company and its
subsidiaries are party to. The Company's revolving credit facility permits it
to pay quarterly dividends in amounts up to its quarterly earnings before
extraordinary or exceptional items, interest, taxes, depreciation and
amortization (Credit Agreement EBITDA), less the aggregate amount of interest
incurred and net amounts payable under interest rate hedging agreements during
the relevant period and an agreed upon reserve for dry-docking for the period,
provided that there is not a default or breach of loan covenant under the
credit facility and the payment of the dividends would not result in a default
or breach of a loan covenant. Depending on market conditions in the dry bulk
shipping industry and acquisition opportunities that may arise, the Company may
be required to obtain additional debt or equity financing which could affect
its dividend policy. However, any determination to pay dividends in the future
will be at the discretion of the Board of Directors and will depend upon the
Company's results of operations, financial condition, capital restrictions,
covenants and other factors deemed relevant by the Board of Directors.

         On February 15, 2007 the Company's Board of Directors declared a cash
dividend for the fourth quarter of 2006 of $0.51 per share, based on 35,900,001
of the Company's common shares outstanding, payable to all shareholders of
record as of February 28, 2007. The aggregate amount of this cash dividend paid
to the Company's shareholders on March 2, 2007 was $18,309,000.

Note 8.  2005 Stock Incentive Plan

         The Company adopted the 2005 Stock Incentive Plan for the purpose of
affording an incentive to eligible persons. The 2005 Stock Incentive Plan
provides for the grant of equity-based awards, including stock options, stock
appreciation rights, restricted stock, restricted stock units, stock bonuses,
dividend equivalents and other awards based

                                                                             13
<PAGE>


on or relating to the Company's common shares to eligible non-employee
directors, selected officers and other employees and independent contractors.
The plan is administered by a committee of the Company's Board of Directors.

         An aggregate of 2.6 million of the Company's shares has been
authorized for issuance under the plan. On March 17, 2006, the Company granted
options to purchase 56,666 of the Company's common shares to its independent
non-employee directors. These options vested and became exercisable on the
grant date at an exercise price of $13.23 per share. On January 12, 2007, the
Company granted options to purchase 13,334 of the Company's common shares to
its independent non-employee directors and 524,000 of the Company's common
shares to members of its management. The options have an exercise price of
$17.80 per share and they vested and became exercisable for the non-employee
directors on the grant date while the options for management vest and become
exercisable over three years. All options expire ten years from the date of
grant.

         For purposes of determining compensation cost for the Company's stock
option plans using the fair value method of FAS 123(R), the fair value of the
options granted was estimated on the date of grant using the Black-Scholes
option pricing model with the following weighted average assumptions: risk free
interest rate of 5%, dividend yield of 11%, expected stock price volatility
factor of 0.45. In the three-months ended March 31, 2007, the Company recorded
a non-cash compensation charge of $121,411 relating to the fair value of these
stock options.

Note 9.  Subsequent Events

         Dividend

         On April 18, 2007 the Company's Board of Directors declared a cash
dividend for the first quarter of 2007 of $0.50 per share, based on 41,713,820
of the Company's common shares outstanding, to be paid on May 3, 2007 to all
shareholders of record as of April 30, 2007. The aggregate amount of this cash
dividend is $20,856,910.

      Vessel Newbuilding Contract

         On April 12, 2007, the Company signed a letter of intent to enter into
a vessel newbuilding contract with IHI Marine United Inc., a Japanese shipyard,
for the construction of its fifth `Future-56' class Supramax vessel. This
56,000 deadweight ton vessel is expected to be delivered in April 2009. The
contract price for the vessel is 3.83 billion Japanese Yen or approximately
$33.6 million after giving effect to currency hedges. The Company has entered
into forward currency hedges to effectively eliminate currency risk on the
vessel newbuilding described above.

      Credit Facility

         On May 4, 2007, the Company's sole lender agreed to provide an
incremental commitment of up to $250,000,000, in addition to its existing
$500,000,000 credit facility. The incremental commitment is subject to the same
terms and conditions as the existing credit facility.


                                                                             14
<PAGE>


ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATION

         The following is a discussion of the Company's financial condition and
results of operation for the three-month periods ended March 31, 2007 and 2006.
This section should be read in conjunction with the consolidated financial
statements included elsewhere in this report and the notes to those financial
statements.

         This discussion contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended and Section 21E of the
Securities Exchange Act of 1934, as amended and the Private Securities
Litigation Reform Act of 1995 and are intended to be covered by the safe harbor
provided for under these sections. These statements may include words such as
"believe," "estimate," "project," "intend," "expect," "plan," "anticipate," and
similar expressions in connection with any discussion of the timing or nature
of future operating or financial performance or other events. Forward looking
statements reflect management's current expectations and observations with
respect to future events and financial performance. Where we express an
expectation or belief as to future events or results, such expectation or
belief is expressed in good faith and believed to have a reasonable basis.
However, our forward-looking statements are subject to risks, uncertainties,
and other factors, which could cause actual results to differ materially from
future results expressed, projected, or implied by those forward-looking
statements. The principal factors that affect our financial position, results
of operations and cash flows include, charter market rates, which have recently
increased to historic highs, and periods of charter hire, vessel operating
expenses and voyage costs, which are incurred primarily in U.S. dollars,
depreciation expenses, which are a function of the cost of our vessels,
significant vessel improvement costs and our vessels' estimated useful lives,
and financing costs related to our indebtedness. Our actual results may differ
materially from those anticipated in these forward looking statements as a
result of certain factors which could include the following: (i) changes in
demand in the dry bulk market, including, without limitation, changes in
production of, or demand for, commodities and bulk cargoes, generally or in
particular regions; (ii) greater than anticipated levels of dry bulk vessel new
building orders or lower than anticipated rates of dry bulk vessel scrapping;
(iii) changes in rules and regulations applicable to the dry bulk industry,
including, without limitation, legislation adopted by international bodies or
organizations such as the International Maritime Organization and the European
Union or by individual countries; (iv) actions taken by regulatory authorities;
(v) changes in trading patterns significantly impacting overall dry bulk
tonnage requirements; (vi) changes in the typical seasonal variations in dry
bulk charter rates; (vii) changes in the cost of other modes of bulk commodity
transportation; (viii) changes in general domestic and international political
conditions; (ix) changes in the condition of the Company's vessels or
applicable maintenance or regulatory standards (which may affect, among other
things, our anticipated dry docking costs); (x) and other factors listed from
time to time in our filings with the Securities and Exchange Commission. This
discussion also includes statistical data regarding world dry bulk fleet and
orderbook and fleet age. We generated some of these data internally, and some
were obtained from independent industry publications and reports that we
believe to be reliable sources. We have not independently verified these data
nor sought the consent of any organizations to refer to their reports in this
annual report. We disclaim any intent or obligation to update publicly any
forward-looking statements, whether as a result of new information, future
events or otherwise, except as may be required under applicable securities
laws.

Overview

         We are Eagle Bulk Shipping Inc., a Marshall Islands corporation
headquartered in New York City. We are the largest U.S. based owner of Handymax
dry bulk vessels. Handymax dry bulk vessels range in size from 35,000 to 60,000
deadweight tons, or dwt, and transport a broad range of major and minor bulk
cargoes, including iron ore, coal, grain, cement and fertilizer, along
worldwide shipping routes. As of March 31, 2007, we owned and operated a modern
fleet of 15 Handymax dry bulk vessels. In addition to our operating fleet of 15
vessels, we have committed to acquired 3 more Handymax vessels which will be
delivered to us in the second quarter of 2007. We have also entered into
contracts for four newbuilding vessels under construction which are scheduled
to be delivered to us from November 2008 through February 2010. These
acquisitions will bring our total operating and newbuild fleet to 22 vessels.



                                                                             15
<PAGE>

         We are focused on maintaining a high quality fleet that is
concentrated primarily in one vessel type - Handymax dry bulk carriers and its
sub-category of Supramax vessels which are Handymax vessels ranging in size
from 50,000 to 60,000 dwt. Twelve of the 15 vessels in our operating fleet at
March 31, 2007, are classed as Supramax dry bulk vessels. These vessels have
the cargo loading and unloading flexibility of on-board cranes while offering
cargo carrying capacities approaching that of Panamax dry bulk vessels, which
range in size from 60,000 to 100,000 dwt and must rely on port facilities to
load and offload their cargoes. We believe that the cargo handling flexibility
and cargo carrying capacity of the Supramax class vessels make them attractive
to potential charterers. Once the three new vessel acquisitions are delivered,
our operating fleet of 18 vessels will consist of 15 Supramaxes and will have a
combined carrying capacity of 915,399 dwt and an average age of only 6 years,
as compared to an average age for the world Handymax dry bulk fleet of over 15
years.

         Each of our vessels is owned by us through a separate wholly owned
Marshall Islands limited liability company.

         We maintain our principal executive offices at 477 Madison Avenue, New
York, New York 10022. Our telephone number at that address is (212) 785-2500.
Our website address is www.eagleships.com. Information contained on our website
does not constitute part of this quarterly report.

         Our financial performance since inception is based on the following
key elements of our business strategy:

         (1)   concentration in one vessel category: Handymax dry bulk vessels,
               which we believe offer size, operational and geographical
               advantages (over Panamax and Capesize vessels),

         (2)   our strategy is to charter our vessels primarily pursuant to
               one- to three-year time charters to allow us to take advantage
               of the stable cash flow and high utilization rates that are
               associated with medium to long-term time charters. Reliance on
               the spot market contributes to fluctuations in revenue, cash
               flow, and net income. On the other hand, time charters provide a
               shipping company with a predictable level of revenues. We have
               entered into time charters for all of our vessels which range in
               length from one to three years and provide for fixed
               semi-monthly payments in advance. This strategy is effective in
               strong and weak dry bulk markets, giving us security and
               predictability of cashflows when we look at the volatility of
               the shipping markets,

         (3)   maintain high quality vessels and improve standards of operation
               through improved environmental procedures, crew training and
               maintenance and repair procedures, and

         (4)   maintain a balance between purchasing vessels as market
               conditions and opportunities arise and maintaining prudent
               financial ratios (e.g. leverage ratio).

Our Fleet

         The following table presents certain information concerning our fleet:

<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------
                                Year                       Time Charter               Daily Time Charter
 Vessel                         Built       Dwt       Employment Expiration (1)           Hire Rate
 ------                         -----       ---       -------------------------           ---------

 SUPRAMAX:
 ---------
<S>                              <C>       <C>         <C>                               <C>
  Cardinal ((2))..........       2004      55,408     March 2007 to June 2007            $26,500
  Condor (3)..............       2001      50,296     May 2009 to August 2009            $20,500
  Falcon .................       2001      50,296     February 2008 to June 2008         $20,950
  Harrier ((4))...........       2001      50,296     March 2007 to June 2007            $23,750
  Hawk I ((5))............       2001      50,296     April 2007 to March 2009           $23,750
  Heron ((6)).............       2001      52,827     December 2007 to February 2008     $24,000
  Jaeger ((7))............       2004      52,248     April 2007 to June 2007            $18,550
  Kestrel I ((8)).........       2004      50,326     December 2007 to April 2008        $18,550

</TABLE>


                                                                      16
<PAGE>

<TABLE>
<CAPTION>


<S>                               <C>       <C>        <C>                                        <C>
  Merlin ((9))................    2001      50,296     October 2007 to December 2007              $24,000
  Osprey I ((10)) ............    2002      50,206     July 2008 to November 2008                 $21,000
  Peregrine ..................    2001      50,913     December 2008 to February 2009             $20,500
  Tern  (11)..................    2003      50,200     December 2007 to April 2008                $19,000
 NEW SUPRAMAX ACQUISITIONS
 -------------------------
  Shrike  (12)................    2003      53,343     April 2009 to June 2009                    $24,600
  Skua  (13)..................    2003      53,350     May 2009 to July 2009                      $24,200
  Kittiwake (14)..............    2002      53,146     May 2008 to July 2008                      $30,400
 HANDYMAX:
 ---------
  Sparrow (15)................    2000      48,225     November 2006 to February 2007             $22,500
  Kite (16)...................    1997      47,195     March 2007 to May 2007                     $14,750
  Griffon ((17))..............    1995      46,635     March 2009 to May 2009                     $20,075
  Shikra .....................    1984      41,096     Vessel sold on February 27,2007            $14,800
 NEWBUILDINGS
 ------------
  Crowned Eagle...............    2008      56,000     Expected to be delivered in November 2008     --
  Crested Eagle...............    2009      56,000     Expected to be delivered in April 2009        --
  Golden Eagle................    2010      56,000     Expected to be delivered in January 2010      --
  Imperial Eagle..............    2010      56,000     Expected to be delivered in February 2010     --

-------------------------------------------------------------------------------------------------------------

     (1)  The date range provided represents the earliest and latest date on
          which the charterer may redeliver the vessel to the Company upon the
          termination of the charter.

     (2)  Upon completion of the current charter the CARDINAL will enter a new
          time charter at $28,000 per day for 11 to 13 months.

     (3)  The charterer of the CONDOR has an option to extend the charter
          period by 11 to 13 months at a time charter rate of $22,000 per day.

     (4)  The charter for the HARRIER has been renewed at $24,000 per day
          commencing in June 2007 for 24 to 27 months.

     (5)  The charter for the HAWK I has been renewed at $22,000 per day
          commencing in April 2007 for 24 to 26 months.

     (6)  Upon completion of the current charter, the HERON commences a new
          time charter with a rate of $26,375 per day for 36 to 39 months.

     (7)  Upon completion of the current charter, the JAEGER commences a new
          time charter with a rate of $27,500 per day for 12 to 14 months. The
          charter rate may reset at the beginning of each month based on the
          average time charter rate for the Baltic Supramax Index, but in no
          case less than $22,500 per day.

     (8)  The charterer of the KESTREL I has an option to extend the charter
          period by 11 to 13 months at a daily time charter rate of $20,000 per
          day.

     (9)  Upon completion of the current charter, the MERLIN commences a new
          time charter for 36 to 39 months. The charter rate is $27,000 per day
          for first year, $25,000 per day for the second year, and $23,000 for
          the third year. Revenue will be recorded on a straight-line basis at
          $25,000 per day for 36 to 39 months.

     (10) The charterer of the OSPREY I has an option to extend the charter
          period by up to 26 months at a time charter rate of $25,000 per day.

     (11) The charterer of the TERN has an option to extend the charter period
          by 11 to 13 months at a time charter rate of $20,500 per day.

     (12) The Company took delivery of the SHRIKE on April 24, 2007 and the
          vessel was immediately delivered to the charterer at time charter
          rate of $24,600 per day for 24 to 26 months. The charterer has an
          option to extend the charter period by 12 to 14 months at a daily
          time charter rate of $25,600.

     (13) The Company is expected to take delivery of the SKUA in June 2007 and
          the vessel will deliver to the charterer at time charter rate of
          $24,200 per day for 23 to 25 months. The charterer has an option to
          extend the charter period by 11 to 13 months at a daily time charter
          rate of $25,200.

     (14) The Company is expected to take delivery of the KITTIWAKE in June
          2007 and the vessel will deliver to the charterer at time charter
          rate of $30,400 per day for 11 to 13 months. The charter rate may
          reset at the beginning of each month based on the average time
          charter rate for the Baltic Supramax Index, but in no case less than
          $24,400 per day.

</TABLE>

                                                                             17
<PAGE>

     (15) Upon completion of the current charter in January 2007, the SPARROW
          commenced a new time charter at a base rate of $24,000 per day for 11
          to 13 months with a profit share of 30% of up to the first $3,000 per
          day over the base rate.

     (16) Upon conclusion of the current charter, the KITE commences a new time
          charter at $21,000 per day for 26 to 29 months.

     (17) Upon completion of the current charter in March 2007, the GRIFFON
          commenced a new time charter at $20,075 per day for 24 to 26 months.


New Acquisitions

         During the three months ended March 31, 2007, we agreed to purchase 3
modern Supramax vessels, the SHRIKE, SKUA and KITTIWAKE, for a total contract
price of $138,700,000. We have placed $23,440,000 in deposits for the three
vessels and the balance of the purchase prices will be paid as each vessel is
delivered between April and June 2007.

         In March 2007, we entered into two vessel newbuilding contracts with
IHI Marine United Inc., a Japanese shipyard, for the construction of two 56,000
deadweight ton vessels, to be named CROWNED EAGLE and CRESTED EAGLE, which are
expected to be delivered in November 2008 and February 2009, respectively. The
contract price for each vessel is 3.83 billion Japanese Yen or approximately
$33.2 million after giving effect to currency hedges. We have placed deposits
for the two newbuilding vessels which amount to an equivalent $25,265,936. We
will pay an additional 10% of each vessel's contract price three months prior
to each vessel's delivery and the balance upon delivery. As of March 31, 2007,
we had four 56,000 deadweight ton vessel newbuildings on order.

         On April 12, 2006, we signed a letter of intent to enter into a vessel
newbuilding contract with IHI Marine United Inc., a Japanese shipyard, for the
construction of a `Future-56' class Supramax vessel. This 56,000 deadweight ton
vessel is expected to be delivered in April 2009. The contract price for the
vessel is 3.83 billion Japanese Yen or approximately $33.6 million after giving
effect to currency hedges. We have entered into forward currency hedges to
effectively eliminate currency risk on the vessel newbuilding described above.
Once this vessel is contracted for, this will be our fifth newbuilding vessel
under construction.

Sale of Vessel

         In February 2007, we sold the SHIKRA, a 1984-built Handymax vessel to
an unrelated third party for $12,525,000. We recorded a gain on the sale of
$872,568.


Fleet Management

         The management of our fleet includes the following functions:

     o   Strategic management. We locate, obtain financing and insurance for,
         purchase and sell vessels.

     o   Commercial management. We obtain employment for our vessels and manage
         our relationships with charterers.

     o   Technical management. The technical manager performs day-to-day
         operations and maintenance of our vessels.

Commercial and Strategic Management

         We carry out the commercial and strategic management of our fleet
through our wholly owned subsidiary, Eagle Shipping International (USA) LLC, a
Marshall Islands limited liability company that maintains its principal
executive offices in New York City. We currently have a total of ten shore
based personnel, including our senior management team and our office staff, who
either directly or through this subsidiary, provides the following services:

     o   commercial operations and technical supervision;

                                                                             18
<PAGE>

     o   safety monitoring;

     o   vessel acquisition; and

     o   financial, accounting and information technology services.

Technical Management

         The technical management of our fleet is provided by unaffiliated
third party technical managers. Until recently, V.Ships, whom we believe is the
world's largest provider of independent ship management and related services,
was the sole technical manager of our fleet. However, the recent growth in our
fleet has provided us with an opportunity to bring in an additional manager and
benchmark our vessel technical operations. We have therefore entered into
agreements with Barbers International Ltd., a leading internationally
recognized ship manager to technically manage some of our vessels. We review
the performance of our ship managers on an ongoing basis and may add or change
technical managers.

         Technical management includes managing day-to-day vessel operations,
performing general vessel maintenance, ensuring regulatory and classification
society compliance, supervising the maintenance and general efficiency of
vessels, arranging our hire of qualified officers and crew, arranging and
supervising drydocking and repairs, purchasing supplies, spare parts and new
equipment for vessels, appointing supervisors and technical consultants and
providing technical support. Our technical managers maintain records of all
costs and expenditures incurred in connection with their services and these are
available for our review on a daily basis. Our technical managers have
established, in conjunction with our management, an operating expense budget
for each of the vessels in our fleet they manage. All deviations from the
budgeted amounts are for our account.

         We currently crew our vessels with Ukrainian and Romanian officers and
seamen supplied by our technical managers. These officers and seamen are
employees of our wholly owned vessel owning subsidiaries while aboard our
vessels. We currently employ a total of 320 officers and seamen on the 15
vessels in our operating fleet. Our technical manager handles each seaman's
training, travel, and payroll and ensures that all our seamen have the
qualifications and licenses required to comply with international regulations
and shipping conventions. Additionally, our seafaring employees perform most
commissioning work and assist in supervising work at shipyards and drydock
facilities. We typically man our vessels with more crew members than are
required by the country of the vessel's flag in order to allow for the
performance of routine maintenance duties. All of our crew members are subject
to and are paid commensurate with international collective bargaining
agreements and, therefore, we do not anticipate any labor disruptions. No
international collective bargaining agreements to which we are a party are set
to expire within two years.

         Our technical managers are paid a fixed management fee for each vessel
in our operating fleet for the technical management services provided. For the
three month period ended March 31, 2007, this technical management fee averaged
$8,851 per vessel per month compared to $8,538 per vessel per month in the
corresponding three-month period ended March 31, 2006.

Value of Assets and Cash Requirements

         The replacement costs of comparable new vessels may be above or below
the book value of our fleet. The market value of our fleet may be below book
value when market conditions are weak and exceed book value when markets are
strong. In common with other shipowners, we may consider asset redeployment
which at times may include the sale of vessels at less than their book value.

         The Company's results of operations and cash flow may be significantly
affected by future charter markets.

Critical Accounting Policies

         The discussion and analysis of our financial condition and results of
operations is based upon our interim, unaudited, consolidated financial
statements, which have been prepared in accordance with accounting principles

                                                                             19
<PAGE>

generally accepted in the United States, and the rules and regulations of the
SEC which apply to interim financial statements. The preparation of those
financial statements requires us to make estimates and judgments that affect
the reported amounts of assets and liabilities, revenues and expenses and
related disclosure of contingent assets and liabilities at the date of our
financial statements. Actual results may differ from these estimates under
different assumptions and conditions.

         Critical accounting policies are those that reflect significant
judgments of uncertainties and potentially result in materially different
results under different assumptions and conditions. As the discussion and
analysis of our financial condition and results of operations is based upon our
interim, unaudited, consolidated financial statements, they do not include all
of the information on critical accounting policies normally included in
consolidated financial statements. Accordingly, a detailed description of these
critical accounting policies should be read in conjunction with the
consolidated financial statements and notes thereto included in the Company's
Annual Reports on Form 10-K. There have been no material changes from the
"Critical Accounting Policies" previously disclosed in our Form 10-K for the
year ended December 31, 2006.


Results of Operations for the three-month periods ended March 31, 2007 and 2006

         Fleet Data

         We believe that the measures for analyzing future trends in our
results of operations consist of the following:


                                                   Three Months ended
                                                   ------------------
                                            March 31, 2007       March 31, 2006
                                            --------------       --------------

Ownership Days.........................         1,407                1,170
Available Days.........................         1,395                1,126
Operating Days.........................         1,387                1,116
Fleet Utilization......................         99.4%                99.1%


o    Ownership days: We define ownership days as the aggregate number of days
in a period during which each vessel in our fleet has been owned by us.
Ownership days are an indicator of the size of our fleet over a period and
affect both the amount of revenues and the amount of expenses that we record
during a period. We operated 16 vessels in the first quarter of 2007 compared
to 13 vessels in the corresponding quarter in 2006, resulting in a commensurate
increase in Ownership days in the first quarter 2007.

o    Available days: We define  available days as the number of our ownership
days less the aggregate number of days that our vessels are off-hire due to
vessel familiarization upon acquisition, scheduled repairs or repairs under
guarantee, vessel upgrades or special surveys and the aggregate amount of time
that we spend positioning our vessels. The shipping industry uses available
days to measure the number of days in a period during which vessels should be
capable of generating revenues. Available days in the first quarter of 2007
increased due to larger fleet size compared to the corresponding quarter in
2006. Available days were however impacted by one vessel entering drydock at
the end of the first quarter of 2007 and time spent positioning the SHIKRA for
sale. Available days in in the corresponding period of 2006 were impacted by
the drydocking of 3 vessels.

o    Operating days: We define  operating days as the number of our available
days in a period less the aggregate number of days that our vessels are
off-hire due to any reason, including unforeseen circumstances. The shipping
industry uses operating days to measure the aggregate number of days in a
period during which vessels actually generate revenues.

o    Fleet  utilization:  We calculate fleet utilization by dividing the number
of our operating days during a period by the number of our available days
during the period. The shipping industry uses fleet utilization to measure a
company's efficiency in finding suitable employment for its vessels and
minimizing the amount of days that its vessels are off-hire for reasons other
than scheduled repairs or repairs under guarantee, vessel upgrades, special
surveys or vessel positioning. Our fleet continues to perform at high
utilization rates.


                                                                             20
<PAGE>

         Revenues

         Shipping revenues are highly sensitive to patterns of supply and
demand for vessels of the size and design configurations owned and operated by
a company and the trades in which those vessels operate. In the drybulk sector
of the shipping industry, rates for the transportation of drybulk cargoes such
as ores, grains, steel, fertilizers, and similar commodities, are determined by
market forces such as the supply and demand for such commodities, the distance
that cargoes must be transported, and the number of vessels expected to be
available at the time such cargoes need to be transported. The demand for
shipments then is significantly affected by the state of the economy globally
and in discrete geographical areas. The number of vessels is affected by
newbuilding deliveries and by the removal of existing vessels from service,
principally because of scrapping.

         Our revenues are driven primarily by the number of vessels in our
fleet, the number of days during which our vessels operate and the amount of
the daily charter hire rates that our vessels earn under charters, which, in
turn, are affected by a number of factors, including:

     o   the duration of our charters;
     o   our decisions relating to vessel acquisitions and disposals;
     o   the amount of time that we spend positioning our vessels;
     o   the amount of time that our vessels spend in dry-dock undergoing
         repairs;
     o   maintenance and upgrade work;
     o   the age, condition and specifications of our vessels;
     o   levels of supply and demand in the dry bulk shipping industry; and
     o   other factors affecting spot market charter rates for dry bulk
         carriers.

         Revenues are also affected by the mix of charters between spot (voyage
charter) and long-term (time charter). Charter hire rates for vessels on voyage
charters are generally not expressed in per day amounts while charter hire
rates for vessels on time charters generally are expressed in such amounts.
Because shipping revenues and voyage expenses are significantly affected by the
mix between voyage charters and time charters, the shipping industry uses a
standard measure called a time charter equivalent ("TCE") rate to compare daily
earnings generated by vessels on time charters with daily earnings generated by
vessels on voyage charters. We define TCE rates as our voyage and time charter
revenues less voyage expenses during a period divided by the number of our
available days during the period. All our vessels are employed on time charters
hence our TCE rate is equal to the time charter rate. Our economic decisions
are based on anticipated TCE rates and we evaluate financial performance based
on TCE rates achieved.

         As is common in the shipping industry, we pay commissions ranging from
1.25% to 6.25% of the total daily charter hire rate of each charter to
unaffiliated ship brokers and in-house brokers associated with the charterers,
depending on the number of brokers involved with arranging the charter.

         Net revenues, for the three-month period ended March 31, 2007, of
$26,908,532 includes billed time charter revenues of $29,476,374 and deductions
for brokerage commissions of $1,487,842 and $1,080,000 in amortization of net
prepaid charter revenue. Net revenues for the three-month period ended March
31, 2007 were 13% greater than net revenues for the three-month period ended
March 31, 2006, primarily due to a larger fleet size as reflected by increased
operating days. Net revenue, for the three-month period ended March 31, 2006,
was $23,790,052 which included billed time charter revenues of $26,048,116 and
deductions for brokerage commissions of $1,321,064 and $937,000 in amortization
of net prepaid and deferred charter revenue.

         Vessel Expenses

         Vessel expenses for the three-month period ended March 31, 2007 were
$6,245,898 compared to $4,704,997 in the three-month period ended March 31,
2006. The increase in vessel expense is attributable to a larger fleet size in
operation for the first quarter of 2007 and increases in vessel crew and
lubricants costs.

                                                                             21
<PAGE>

         Vessel expenses for the three-month period ended March 31, 2007
included $5,836,461 in vessel operating costs and $409,437 in technical
management fees. For the three-month period ended March 31, 2006, vessel
expenses included $4,369,997 in vessel operating costs and $335,000 in
technical management fees.

         Vessel operating expenses include crew wages and related costs, the
cost of insurance, expenses relating to repairs and maintenance, the cost of
spares and consumable stores and related inventory, tonnage taxes,
pre-operating costs associated with the delivery of acquired vessels including
providing the newly acquired vessels with initial provisions and stores, and
other miscellaneous expenses.

         Our vessel expenses will increase with the enlargement of our fleet.
Other factors beyond our control, some of which may affect the shipping
industry in general, may also cause these expenses to increase, including, for
instance, developments relating to market prices for crew, insurance and
petroleum-based lubricants and supplies.

         Depreciation and Amortization

         The cost of our vessels is depreciated on a straight-line basis over
the expected useful life of each vessel. Depreciation is based on the cost of
the vessel less its estimated residual value. We estimate the useful life of
our vessels to be 28 years from the date of initial delivery from the shipyard
to the original owner. Furthermore, we estimate the residual values of our
vessels to be $150 per lightweight ton, which we believe is common in the dry
bulk shipping industry. Our depreciation charges will increase as our fleet is
enlarged which will lead to an increase in ownership days. For the three month
periods ended March 31, 2007 and 2006, total depreciation and amortization
expense was $5,790,631 and $4,819,582, respectively. Total depreciation and
amortization expense for the three-month period ended March 31, 2007 includes
$5,515,648 of vessel depreciation and $274,983 relating to the amortization of
deferred drydocking costs. Comparable amounts for three-month period ended
March 31, 2006 were $4,697,471 of vessel depreciation and $122,111 in
amortization of deferred drydocking costs, respectively.

         Amortization of deferred financing costs is included in interest
expense. These financing costs relate to costs associated with our revolving
credit facility and these are amortised over the life of the facility. For the
three month periods ended March 31, 2007 and 2006, the amortization of deferred
financing costs was $58,012 and $32,950, respectively.

         General and Administrative Expenses

         Our general and administrative expenses include recurring
administrative costs and non-recurring formation and advisory costs. Recurring
costs include our onshore vessel administration related expenses such as legal
and professional expenses and administrative and other expenses including
payroll and expenses relating to our executive officers and office staff,
office rent and expenses, directors fees, and directors and officers insurance.
Non-recurring costs include costs relating to the formation of our company and
related advisory costs.

         General and Administrative Expenses for the three month periods ended
March 31, 2007 and 2006 were $1,643,070 and $985,479, respectively. The
increase in General and Administrative Expenses for the three months ended
March 31, 2007 was attributable to expenses associated with a larger fleet. We
expect general and administrative expenses to increase as our fleet is
enlarged.

         Non-Cash Compensation Expense

         For the three-month periods ended March 31, 2007 and 2006, the Company
recorded non-cash compensation charges of $3,259,223 and $752,686,
respectively. The expense for the three-month period ended March 31, 2007
includes $3,137,812 in non-cash, non-dilutive charges relating to profits
interests awarded to members of the Company's management by the Company's
former principal shareholder Eagle Ventures LLC, and a non-cash amount of
$121,411 which relates to the fair value of the stock options granted in
January 2007 to certain directors of the Company and members of management
under the 2005 Stock Incentive Plan.

                                                                             22
<PAGE>

         On January 9, 2007, Eagle Ventures, sold 7,202,679 shares of the
Company's common stock in a secondary offering. The Company did not receive any
proceeds from this offering. Based on the discretion of the compensation
committee of Eagle Ventures, exercised in accordance with the Fifth LLC
Agreement, Eagle Ventures redeemed and retired the common interests held by
certain members in full liquidation of the common interests held such members.
The remaining proceeds received by Eagle Ventures will be retained until a
future distribution is determined to be made by the compensation committee of
Eagle Ventures. Future distributions of the remaining cash proceeds, and the
proceeds received from the sale of the 127,778 shares of our common stock held
by Eagle Ventures, will be distributed to the remaining members of Eagle
Ventures, including an affiliate of Kelso and members of our management that
hold profits interests, in accordance with the Fifth LLC Agreement, as modified
by the permitted discretion of the compensation committee of Eagle Ventures
reflected in an amendment to the Fifth LLC Agreement.

         These non-cash, non-dilutive charges relate to profits interests
awarded to members of the Company's management by the Company's former
principal shareholder Eagle Ventures LLC. These profits interests will dilute
only the interests of the owners of Eagle Ventures LLC, and will not dilute the
direct holders of the Company's common stock. The non-cash compensation charge
is being recorded as an expense over the estimated service period in accordance
with SFAS No. 123(R). The non-cash compensation charges have been based on the
fair value of the profits interests which were "marked to market" at the end of
each reporting period. The impact of any changes in the estimated fair value of
the profits interests was recorded as a change in estimate cumulative to the
date of change. The expense relating to the profits interests is now fixed.
There will be no charges in future periods. The Company's Financial Statements
for the year ended December 31, 2006 on Form 10-K includes a more detailed
description of these profits interests.

         Interest and Finance Costs

         During the three months ended March 31, 2007, we borrowed a total of
$38,089,741 from our $500,000,000 revolving credit facility. Of these
borrowings $25,649,741 was used to fund the deposits and part of the
capitalized financing costs for the two newbuilding vessels which were
contracted for construction during the quarter, and $12,440,000 was used to
partly fund the deposits for the three vessels which we agreed to acquire in
the quarter.

         During the three months ended March 31, 2007, we used $12,440,000 from
the gross proceeds of the sale of the SHIKRA to repay borrowings from the
revolving credit facility.

         At March 31, 2007, our debt consisted of $265,624,561 in borrowings
under the revolving credit facility.

         The facility bears interest at the rate of 0.75% to 0.85% over LIBOR,
depending upon the amount of debt drawn as a percentage of the value of the
Company's vessels. We also pay on a quarterly basis a commitment fee of 0.25%
per annum on the undrawn amount of the facility. For the three-month period
ended March 31, 2007, interest rates applicable on our debt ranged from 4.97%
to 6.09%, including the margin. The weighted average effective interest rate
was 5.45%.

         At March 31, 2006, our debt consisted of $140,000,000 in borrowings
under the original $330,000,000 revolving credit facility. During that period,
the facility bore interest at the rate of 0.95% over LIBOR and Commitment fees
were incurred at 0.4% on the unused portion of the facility. For the
corresponding three-month period ended March 31, 2006 interest rates applicable
on our debt ranged from 5.17% to 5.49%, including the then applicable margin.
The weighted average effective interest rate was 5.26%.

         Interest Expense, exclusive of capitalized interest, consists of:

                                                         Three Months ended
                                                         ------------------
                                                March 31, 2007    March 31, 2006
                                                --------------    --------------

 Loan Interest...............................       $2,948,754        $1,841,290
 Commitment Fees.............................          145,359           192,111
 Amortization of Deferred Financing Costs....           58,012            32,950
                                                ---------------   --------------
 Total Interest Expense......................       $3,152,125        $2,066,351
                                                ===============   ==============


                                                                             23
<PAGE>


      Capitalized Interest

         Interest expense on the debt borrowed in the three months ended March
31, 2007, to fund the deposits for the newbuilding vessels amounted to $509,051
($473,314 in financing costs and $35,737 in amortization of financing expenses)
and this amount has been capitalized as part of the cost of the newbuilding
vessels and is included in Advances for Vessel Construction in the financial
statements as of March 31, 2007.

      Interest Rate Swaps

         We have entered into interest rate swaps to effectively convert a
portion of its debt from a floating to a fixed-rate basis. The swaps are
designated and qualify as cash flow hedges.

         During the quarter ended March 31, 2007, we entered an interest rate
swap contract for a notional amount of $25,776,443. This contract matures in
March 2010. On this contract, exclusive of applicable margin, the Company will
pay 4.90% fixed-rate interest and receive floating-rate interest amounts based
on three-month LIBOR settings. We have four other interest rate swap contracts
as follows:

         -     Notional amount of $100,000,000 with a fixed interest rate of
               4.22% and maturity in September 2010

         -     Notional amount of $30,000,000 with a fixed interest rate of
               4.54% and maturity in September 2010

         -     Notional amount of $84,800,000 with a fixed interest rate of
               5.24% and maturity in September 2009

         -     Notional amount of $25,048,118 with a fixed interest rate of
               4.74% and maturity in September 2011

         We record the fair value of the interest rate swaps as an asset or
liability on the balance sheet. The effective portion of the swap is recorded
in accumulated other comprehensive income. Accordingly, $1,763,161 and
$2,936,804 has been recorded in Other Assets in the financial statements as of
March 31, 2007 and December 31, 2006, respectively.

         Foreign Currency Swaps

         The shipping industry's functional currency is the U.S. dollar. All
our revenues and the majority of our operating expenses and the entirety of our
management expenses are in U.S. dollars. Therefore we do not use or intend to
use financial derivatives to mitigate the risk of exchange rate fluctuations
for our revenues and expenses.

         However, we have entered into foreign exchange swap transactions to
hedge foreign currency risks on its capital asset transactions (vessel
newbuildings). The swaps are designated and qualify as cash flow hedges. At
December 31, 2006, the Company had outstanding foreign currency swap contracts
for notional amounts aggregating 4.386 billion Japanese yen swapped into
equivalent US $42,310,465. During the three months ended March 31, 2007, we
entered into foreign exchange swap transactions to hedge the Japanese yen
exposure into US dollars for the purchase price in Japanese yen of two
new-build vessels which are expected to be delivered to the Company in November
2008 and February 2009. During the quarter, we swapped a total of 7.66 billion
in Japanese yen currency exposure into equivalent US $66,386,179.

         After giving effect to the deposits paid for the newbuildings, at
March 31, 2007, the Company had outstanding foreign currency swap contracts for
notional amounts aggregating 8.982 billion Japanese yen swapped into equivalent
US $83,430,708. We record the fair value of the currency swaps as an asset or
liability in its financial statement. The effective portion of the swap is
recorded in accumulated other comprehensive income. Accordingly, an amount of
$45,411 and $359,180 has been recorded in Other Liabilities in the accompanying
financial statements as of March 31, 2007 and December 31, 2006, respectively.

         On April 12, 2007, we signed a letter of intent to enter into a vessel
newbuilding contract with IHI Marine United Inc., a Japanese shipyard, for the
construction of our fifth `Future-56' class Supramax vessel. This 56,000
deadweight ton vessel is expected to be delivered in April 2009. The contract
price for the vessel is 3.83 billion Japanese Yen or approximately $33.6
million after giving effect to currency hedges. We have entered into forward
currency hedges to effectively eliminate currency risk on the vessel
newbuilding described herein.


                                                                             24
<PAGE>

         Gain on Sale of Vessel

         On February 27, 2007, we sold the SHIKRA, a 1984-built Handymax
vessel, to an unrelated third party for $12,525,000. We incurred total expenses
of $513,518 relating to the sale. We recorded a gain on the sale of $872,568.

         EBITDA

         EBITDA represents operating earnings before extraordinary items,
depreciation and amortization, interest expense, and income taxes, if any.
EBITDA is included because it is used by certain investors to measure a
company's financial performance. EBITDA is not an item recognized by GAAP and
should not be considered a substitute for net income, cash flow from operating
activities and other operations or cash flow statement data prepared in
accordance with accounting principles generally accepted in the United States
or as a measure of profitability or liquidity. EBITDA is presented to provide
additional information with respect to the Company's ability to satisfy its
obligations including debt service, capital expenditures, and working capital
requirements. While EBITDA is frequently used as a measure of operating results
and the ability to meet debt service requirements, the definition of EBITDA
used here may not be comparable to that used by other companies due to
differences in methods of calculation.

         Our revolving credit facility permits us to pay dividends in amounts
up to our earnings before extraordinary or exceptional items, interest, taxes,
depreciation and amortization (Credit Agreement EBITDA), less the aggregate
amount of interest incurred and net amounts payable under interest rate hedging
agreements during the relevant period and an agreed upon reserve for
dry-docking. Therefore, we believe that this non-GAAP measure is important for
our investors as it reflects our ability to pay dividends. The following table
is a reconciliation of net income, as reflected in the consolidated statements
of operations, to the Credit Agreement EBITDA:

                                                        Three Months ended
                                                        ------------------
                                                 March 31, 2007   March 31, 2006
                                                 --------------   --------------

Net Income......................................     $8,487,788      $10,792,501
Interest Expense................................      3,152,125        2,066,351
Depreciation and Amortization...................      5,790,631        4,819,582
Amortization of Prepaid and Deferred Revenue....      1,080,000          937,000
                                                --------------------------------
EBITDA..........................................     18,510,544       18,615,434
Adjustments for Exceptional Items:
Non-cash Compensation Expense (1) ..............      3,259,223          752,686
                                                --------------------------------
Credit Agreement EBITDA ........................   $ 21,769,767     $ 19,368,120
                                                ================================

     (1)  Management's participation in profits interests in Eagle Ventures LLC
          and expense for share options (see Notes to our financial statements)


Effects of Inflation

         We do not believe that inflation has had or is likely, in the
foreseeable future, to have a significant impact on vessel operating expenses,
drydocking expenses or general and administrative expenses.

Liquidity and Capital Resources

         Net cash provided by operating activities during the three month
periods ended March 31, 2007 and 2006 was $18,802,624 and $15,749,648,
respectively. The increase was primarily due to cash generated from the
operation of the fleet for 1,407 operating days in the three-month period ended
March 31, 2007 compared to 1,170 operating days during the same period in 2006.

         Net cash used in investing activities during the three-month period
ended March 31, 2007, was $37,251,697. During the three months ended March 31,
2007, we placed $23,440,000 in deposits on 3 modern Supramax vessels, the
SHRIKE, SKUA and KITTIWAKE, which we agreed to purchase for a total contract
price of $138,700,000 and the balance of the purchase prices will be paid as
each vessel is delivered between April and June 2007. We also incurred
associated costs of $35,897 relating to the vessel acquisitions. During the
three months ended March 31, 2007, for our newbuilding program, we placed
deposits in Japanese yen of an equivalent $25,265,936 for two 56,000 deadweight
ton vessels, CROWNED EAGLE and CRESTED EAGLE, which are to be constructed and
delivered in November 2008 and February 2009, respectively. We also incurred


                                                                             25
<PAGE>

associated capitalized interest costs of $473,314 and capitalized legal,
insurance and technical supervision costs of $48,032. During the three months
ended March 31, 2007, we sold the SHIKRA, a 1984-built Handymax vessel, to an
unrelated third party for $12,525,000 and we incurred total expenses of
$513,518 relating to the sale.

         Net cash provided by financing activities during the three month
period ended March 31, 2007 was $115,168,794. In the three-month period ended
March 31, 2007, we received $110,171,870 in gross proceeds from the sale of our
common shares and we paid costs of $2,743,067 associated with the sale. We
borrowed $38,089,741 from our revolving credit facility, of which amount
$25,649,741 was used to fund the deposits and part of the capitalized financing
costs for the two newbuilding vessels which were contracted for construction
during the quarter, and $12,440,000 was used to partly fund the deposits for
the three vessels which we agreed to acquire in the quarter. We used
$12,440,000 from the gross proceeds of the sale of the SHIKRA to repay
borrowings from the revolving credit facility. Due to the sale of the vessel,
we also reduced our Restricted Cash by $400,000. During the quarter we paid
$18,309,000 in dividends. Net cash used by financing activities during the
three month period ended March 31, 2006 was $18,897,030 and primarily consisted
of dividend payments of $18,895,500.

         As of March 31, 2007, our cash balance was $118,995,212 compared to a
cash balance of $21,379,146 at March 31, 2006. In addition, $6,000,000 in cash
deposits are maintained with our lender for loan compliance purposes and this
amount is recorded in Restricted Cash in our financial statements as of March
31, 2007. The cash deposit amount at the end of December 31, 2006 was
$6,400,000. Also recorded in Restricted Cash is an amount of $124,616 which is
collateralizing a letter of credit relating to our office lease.

         At March 31, 2007, we had a remaining undrawn capacity of $234,375,439
available to borrow for future acquisitions of dry bulk vessels under our
$500,000,000 revolving credit facility. The facility also provides us with the
ability to borrow up to $15,000,000 for working capital purposes. (See section
entitled "Revolving Credit Facility" for a description of the facility).

         We anticipate that our current financial resources, together with cash
generated from operations and, if necessary, borrowings under our revolving
credit facility will be sufficient to fund the operations of our fleet,
including our working capital requirements, for at least the next 12 months. We
were in compliance with all of the covenants contained in our debt agreements
as of March 31, 2007.

         It is our intention to fund our future acquisition related capital
requirements initially through borrowings under the amended and increased
revolving credit facility and to repay all or a portion of such borrowings from
time to time with the net proceeds of equity issuances. We have in place a
shelf registration under Form S-3 which enables us to issue up to $220,500,000
in securities of which amount we have issued $110,171,800 in common shares. We
believe that funds will be available to support our growth strategy, which
involves the acquisition of additional vessels, and will allow us to pay
dividends to our stockholders as contemplated by our dividend policy.

Dividends

         Our policy is to declare quarterly dividends to stockholders in
February, April, July and October in amounts that are substantially equal to
our available cash from operations during the previous quarter less any cash
reserves for drydocking and working capital.

         Our revolving credit facility permits us to pay quarterly dividends in
amounts up to our quarterly earnings before extraordinary or exceptional items,
interest, taxes, depreciation and amortization (Credit Agreement EBITDA), less
the aggregate amount of interest incurred and net amounts payable under
interest rate hedging agreements during the relevant period and an agreed upon
reserve for drydocking for the period, provided that there is not a default or
breach of loan covenant under the credit facility and the payment of the
dividends would not result in a default or breach of a loan covenant. Depending
on market conditions in the dry bulk shipping industry and acquisition


                                                                             26
<PAGE>

opportunities that may arise, we may be required to obtain additional debt or
equity financing which could affect our dividend policy.

         On February 15, 2007 our Board of Directors declared a cash dividend
for the fourth quarter of 2006 of $0.51 per share, based on 35,900,001 of the
Company's common shares outstanding, payable to all shareholders of record as
of February 28, 2007. The aggregate amount of this cash dividend paid to our
shareholders on March 2, 2007 was $18,309,000.

         On April 18, 2007 our Board of Directors declared a cash dividend for
the first quarter of 2007 of $0.50 per share based on 41,713,820 of the
Company's common shares outstanding, to be paid on May 3, 2007 to all
shareholders of record as of April 30, 2007. The aggregate amount of this cash
dividend is $20,856,909. Since we did not own the three vessels we agreed to
acquire in the quarter and did not receive the benefit of their revenues during
the quarter (the SHRIKE delivered on April 24, 2007 and deliveries of the SKUA
and KITTIWAKE are expected in June 2007), we funded approximately $2,850,000 of
this dividend from excess working capital in order to pay the indicated
dividend of $0.50 per share.

Sale of Common Shares

         On January 9, 2007, the Company's then principal shareholder, Eagle
Ventures, sold 7,202,679 shares from its holdings of the Company's common stock
in a secondary sale offering. The Company did not receive any proceeds from this
offering.

         On March 6, 2007, we sold 5,400,000 of the Company's common shares at
a price to the public of $18.95 per share raising gross proceeds of
$102,330,000. On March 20, 2007, we raised an additional $7,841,870 in gross
proceeds from the underwriter's exercise of their over-allotment option for the
purchase of 413,819 of the Company's common shares. We will use the net
proceeds from the offering to fund a portion of the acquisition costs of three
vessels, the SHRIKE, SKUA and KITTIWAKE which we committed to acquire in the
quarter ended March 31, 2007 and which are expected to be delivered between
April and June 2007, and for general corporate purposes.

         We incurred fees and expenses of $3,181,989 relating to the secondary
sale and sale of the common shares.

Revolving Credit Facility

         In July 2005, we entered into a 10-year $330,000,000 revolving credit
facility. As of December 31, 2005, the outstanding indebtedness under the
revolving credit facility was $140,000,000. In July 2006, we amended and
increased our initial revolving credit facility to $450,000,000 with a new term
of ten years expiring in July 2016. In November 2006, we further enhanced our
facility to $500,000,000 to facilitate our newbuilding program. The facility
also provides us with the ability to borrow up to $15,000,000 for working
capital purposes. There are no principal repayment obligations under the amended
facility until July 2012. Over the remaining four years until maturity in July
2016, the facility will reduce in semi-annual amounts of $28,750,000 with a
final reduction of $270,000,000 occurring simultaneously with the last
semi-annual reduction. The Company's Form 10-K for the year ended December 31,
2006 includes a more detailed description of the revolving credit facility.

         At March 31, 2007, our debt consisted of $265,624,561 in borrowings
under the revolving credit facility. $50,824,561 of these borrowings have been
used to fund our newbuilding program. At March 31, 2007, we had a remaining
undrawn capacity of $234,375,439 available to borrow under the revolving credit
facility for future acquisitions of dry bulk vessels.

         Subsequent to the quarter ended March 31, 2007, the Company's sole
lender agreed to provide an incremental commitment of up to $250,000,000, in
addition to its existing $500,000,000 credit facility. The incremental
commitment is subject to the same terms and conditions as our existing credit
facility.

                                                                             27
<PAGE>

Contractual Obligations

         The following table sets forth our expected contractual obligations
and their maturity dates as of March 31, 2007:

<TABLE>
<CAPTION>

 (in thousands of U.S. dollars)                   Within          One to       Three to      More than
                                                 One Year     Three Years     Five Years     Five years     Total
                                                 --------     -----------     ----------     ----------     -----

<S>                                              <C>              <C>               <C>             <C>    <C>
 Vessels (1) ...............................     $115,260         $83,431       $    --        $     --    $198,691
 Bank Loans  ...............................     $     --         $    --       $    --        $265,625    $265,625
 Interest and borrowing fees (2) ...........       11,500          30,571        30,529          68,711     141,310
 Office lease (3)...........................          188             501           313              --       1,002
                                               ---------------------------------------------------------------------
 Total......................................     $126,948        $114,503       $30,842        $334,335    $606,627
                                               =====================================================================
</TABLE>

     (1) Balance of the contract price of the SHRIKE, SKUA and KITTIWAKE which
         are expected to be delivered between April and June 2007, and the
         balance of the contract price in US dollars for the four newbuilding
         vessels which are to be constructed and delivered between November
         2008 and February 2010.

     (2) The Company is a party to floating-to-fixed interest rate swaps
         covering notional amounts of $100,000,000, $30,000,000, $84,800,000,
         $25,048,118 and $25,776,443 as of March 31, 2007 that effectively
         convert the Company's interest rate exposure from a floating rate
         based on LIBOR to a fixed rate of 4.22%, 4.54%, 5.24%, 4.74% and 4.90%
         respectively, plus applicable margin. Interest and borrowing fees
         includes capitalized interest for the newbuilding vessels.

     (3) Remainder of the 63-month lease on the office space which we occupy.

         Capital Expenditures

         Our capital expenditures relate to purchase of vessels and capital
improvements to our vessels which are expected to enhance the revenue earning
capabilities and safety of these vessels. During the three months ended March
31, 2007, we entered into agreements to acquire three Supramax vessels, the
SHRIKE, SKUA and KITTIWAKE, for a total contracted price of $138,700,000. We
have placed $23,440,000 in deposits for the 3 modern Supramax vessels and the
balance of the purchase prices will be paid as each vessel is delivered between
April and June 2007. During the three months ended March 31, 2007, for our
newbuilding program, we placed deposits in Japanese yen of an equivalent
$25,265,936 for two 56,000 deadweight ton vessels, CROWNED EAGLE and CRESTED
EAGLE, which are to be constructed and delivered in November 2008 and February
2009, respectively.

         In addition to acquisitions that we may undertake in future periods,
other major capital expenditures include funding the Company's maintenance
program of regularly scheduled drydocking necessary to preserve the quality of
our vessels as well as to comply with international shipping standards and
environmental laws and regulations. Although the Company has some flexibility
regarding the timing of its dry docking, the costs are relatively predictable.
Management anticipates that vessels are to be drydocked every two and a half
years. Funding of these requirements is anticipated to be met with cash from
operations. We anticipate that this process of recertification will require us
to reposition these vessels from a discharge port to shipyard facilities, which
will reduce our available days and operating days during that period.

         At the end of the first quarter of 2007, one of our vessels commenced
a regularly scheduled drydocking. Drydocking costs incurred are amortized to
expense on a straight-line basis over the period through the date the next
drydocking for those vessels are scheduled to occur. The following table
represents certain information about the estimated costs for anticipated vessel
drydockings in the next four quarters, along with the anticipated off-hire
days:

  ----------------------------------------------------------------------------
   Quarter Ending                     Off-hire Days(1)     Projected Costs(2)
   June 30, 2007..................           15               $0.4 million
   September 30, 2007.............           30               $0.8 million
   December 31, 2007..............           30               $0.8 million
   March 31, 2008.................           15               $0.4 million

  ----------------------------------------------------------------------------

     (1) Actual duration of drydocking will vary based on the condition of the
         vessel, yard schedules and other factors.

     (2) Actual costs will vary based on various factors, including where the
         drydockings are actually performed.
  ----------------------------------------------------------------------------

                                                                             28
<PAGE>


Off-balance Sheet Arrangements

         We do not have any off-balance sheet arrangements.


                                                                             29

<PAGE>

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk

         There have been no material changes from the "Interest Rate Risk"
previously disclosed in our Form 10-K for the year ended December 31, 2006.

Currency and Exchange Rates

         The shipping industry's functional currency is the U.S. dollar. The
Company generates all of its revenues in U.S. dollars. The majority of the
Company's operating expenses and the entirety of its management expenses are in
U.S. dollars. The Company does not intend to use financial derivatives to
mitigate the risk of exchange rate fluctuations for its revenues and expenses.

         The Company has entered into foreign exchange swap transactions to
hedge foreign currency risks on its capital asset transactions (vessel
newbuildings). The swaps are designated and qualify as cash flow hedges. In
2006, the Company has entered into foreign exchange swap transactions to hedge
the Japanese yen exposure into US dollars for the purchase price in Japanese
yen of two new-build vessels which are expected to be constructed and delivered
to the Company in January 2010 and February 2010. After giving effect to the
deposits paid on these newbuildings, at December 31, 2006, the Company had
outstanding foreign currency swap contracts for notional amounts aggregating
4.386 billion Japanese yen swapped into equivalent US $42,310,465. During the
three months ended March 31, 2007, the Company entered into foreign exchange
swap transactions to hedge the Japanese yen exposure into US dollars for the
purchase price in Japanese yen of two new-build vessels which are expected to
be delivered to the Company in November 2008 and February 2009. During the
quarter, the Company swapped a total of 7.66 billion in Japanese yen currency
exposure into equivalent US $66,386,178. After giving effect to the deposits
paid for the newbuildings, at March 31, 2007, the Company had outstanding
foreign currency swap contracts for notional amounts aggregating 8.982 billion
Japanese yen swapped into equivalent US $83,430,708. The Company records the
fair value of the currency swaps as an asset or liability in its financial
statement. The effective portion of the swap is recorded in accumulated other
comprehensive income. Accordingly, an amount of $45,411 and $359,180 has been
recorded in Other Liabilities in the accompanying financial statements as of
March 31, 2007 and December 31, 2006, respectively.

         On April 12, 2007, the Company signed a letter of intent to enter into
a vessel newbuilding contract for the construction of its fifth newbuilding
vessel at a Japanese shipyard. The vessel is expected to be constructed and
delivered to the Company in April 2009. The Company has entered into forward
currency hedges to effectively eliminate currency risk on the vessel
newbuilding described herein. It has swapped 3.83 billion Japanese yen into
equivalent US $33,600,000.


                                                                             30

<PAGE>


Item 4. Controls and Procedures

Disclosure Controls and Procedures

         Our management, including our Chief Executive Officer and Chief
Financial Officer, has evaluated the effectiveness of our disclosure controls
and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the
Securities Exchange Act of 1934, as amended, (the "Exchange Act")) as of the
end of the period covered by this report. Based upon that evaluation, our Chief
Executive Officer and Chief Financial Officer have concluded that our
disclosure controls and procedures are effective.

Internal Control Over Financial Reporting

         There have been no changes in our internal control over financial
reporting during the period covered by this report that have materially
affected, or are reasonably likely to materially affect, our internal control
over financial reporting.




                                                                             31
<PAGE>

PART II: OTHER INFORMATION

Item 1 - Legal Proceedings

         We are not aware of any legal proceedings or claims to which we or our
subsidiaries are party or of which our property is subject. From time to time
in the future, we may be subject to legal proceedings and claims in the
ordinary course of business, principally personal injury and property casualty
claims. Those claims, even if lacking merit, could result in the expenditure by
us of significant financial and managerial resources.

Item 1A - Risk Factors

         There have been no material changes from the "Risk Factors" previously
disclosed in our Form 10-K for the year ended December 31, 2006.

Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds

         On March 17, 2006, the Company granted 56,666 shares of the Company's
stock in options to its independent non-employee directors. These options
vested and became exercisable on the grant date at an exercise price of $13.23
per share. All options expire ten years from the date of grant.

         On January 12, 2007, the Company granted options to purchase 13,334 of
the Company's common shares to its independent non-employee directors and
524,000 of the Company's common shares to members of its management. The
options have an exercise price of $17.80 per share and they vested and became
exercisable for the non-employee directors on the grant date while the options
for management vest and become exercisable over three years. All options expire
ten years from the date of grant.

Item 3 - Defaults upon Senior Securities

         None.

Item 4 - Submission of Matters to a Vote of Security Holders

         None.

Item 5 - Other Information

         None.

Item 6 - Exhibits

                                 EXHIBIT INDEX

     3.1        Amended and Restated Articles of Incorporation of the Company*

     3.2        Amended and Restated Bylaws of the Company*

     4.1        Form of Share Certificate of the Company*

     10.1       Form of Registration Rights Agreement*

     10.2       Form of Management Agreement*

     10.3       Form of Amended and Restated Credit Agreement**


                                                                             32
<PAGE>


     10.3.1     Form of Second Amended and Restated Credit Agreement***

     10.3.2     Amendatory Agreement to the Amended and Restated Credit
                Agreement, dated May 3, 2002

     10.4       Eagle Bulk Shipping Inc. 2005 Stock Incentive Plan*

     10.5       Employment Agreement for Mr. Sophocles N. Zoullas*

     31.1       Rule 13a-14(d) / 15d-14(a)_Certification of CEO

     31.2       Rule 13a-14(d) / 15d-14(a)_Certification of CFO

     32.1       Section 1350 Certification of CEO

     32.2       Section 1350 Certification of CFO


     *   Incorporated by reference to the Registration Statement on Form S-1,
         Registration No. 333-123817.

     **  Incorporated by reference to the Report on Form 8-K filed on July 31,
         2006.

     *** Incorporated by reference to the Registrant's annual report on Form
         10-K for the period ending December 31, 2005 filed on March 14, 2006.



                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
of 1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.

EAGLE BULK SHIPPING INC.

By:    /s/ Sophocles N. Zoullas
----------------------------------
Sophocles N. Zoullas
Chairman of the Board and
Chief Executive Officer
Date:    May 9, 2007


By:    /s/ Alan S. Ginsberg
----------------------------------
Alan S. Ginsberg
Chief Financial Officer
and Treasurer
Date:    May 9, 2007


                                                                             33