Polys Hajioannou - Chairman and Chief Executive Officer Loukas Barmparis - President Konstantinos Adamopoulos - Chief Financial Officer.

Shawn Collins - Bank of America Merrill Lynch Fotis Giannakoulis - Morgan Stanley Amit Mehrotra - Deutsche Bank.

Thank you for standing by, ladies and gentlemen, and welcome to the Safe Bulkers Conference Call to discuss the Second Quarter 2015 Financial Results. Today we have with us from Safe Bulkers, Chairman and Chief Executive Officer, Polys Hajioannou; President, Dr. Loukas Barmparis; and Chief Financial Officer, Konstantinos Adamopoulos.

At this time, all participants are in listen-only mode. There will be a presentation followed by a question-and-answer session [Operator Instructions]. Following this conference call, if you need any further information on the conference call or the presentation, please contact Capital Link at 212-661-7566.

I must advise you that this conference is being recorded today.

Before we begin, please note that this presentation contains forward-looking statements as defined in Section 27A of the Securities Act of 1933 as amended, and Section 21E of the Securities Exchange Act of 1934 as amended, concerning future events, the Company’s growth strategy and measures to implement such strategy, including expected vessel acquisitions and entering into further time charters.

Words such as expects, intends, plans, believes, anticipates, hopes, estimates and variations of such words and similar expressions are intended to identify forward-looking statements.

Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct.

These statements involve known and unknown risks, and are based upon a number of assumptions and estimates, which are inherently subject to significant uncertainties and contingencies, many of which are beyond the control of the Company. Actual results may differ materially from those expressed or implied by such forward-looking statements.

Factors that could cause actual results to differ materially include, but are not limited to, changes in the demand for dry bulk vessels, competitive factors in the market in which the Company operates, risks associated with the operations outside the United States, and other factors listed from time-to-time in the Company’s filings with the Securities and Exchange Commission.

The Company expressly disclaims any obligations or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company’s expectations with respect thereto, to any change in events, conditions or circumstances on which any statement is based. And I now pass the floor to Dr.

Barmparis. Please go ahead, sir..

Good morning. I’m Loukas Barmparis, President of Safe Bulkers. Welcome to our conference call and webcast. Let’s move to discuss the financial results for the second quarter of 2015, which were announced yesterday after the close of the market in New York. Slide 3, where we present the synopsis of the market outlook.

On the top of the slide we present the comparison of the daily average [indiscernible] higher for both Capes and Panamaxes. Capes for full 2015 have been trading lower than expected periods of 2014. During June 2015, market positions pushed charter market higher and for the first time, it is higher than 2014.

Financial details of trading of the USD14.5k in contrast to the year-to-date average of USD5.5K and the five-year average of USD15.8K. Same for Panamaxes market has been continuously trading at lower levels from 2014 [indiscernible] 2014 that is the high obviously 9.4k.

Presently Panamax market is trading at about 8.5k in comparison to 5.5k for the year-to-date and the 10.1 for the five-year period. On the bottom of the slide, represent certain key focus affecting the charter market. I have more experience in Greece and China in June of above 6% of overall demanding is stable in comparison to last year.

This also reflected in the current improvement of the Capes market, Chinese iron ore inventory slipped by 7% and presently the lowest level since November 2015. This is subject to total iron ore is expected to enhance which could potentially provide some further support to the Capes market.

Coal market the major event of this year is a significant Chinese import which is continuing and its equivalent to 58% compared to same period last year reaching 99.9 million tons only. On the other hand continuous growth of coal imports from India is currently balancing the business in the secondary market.

Up to date India has imported above 110 million tons which approximately 51% increase to last year with greater market infrastructure from China increased by 30% reaching 8.1 million tons this has also been reflected to the Panamax market. Year-to-date imports have increased above 20% compared to 3% in the 2015.

According to USDA volumes of USDA and trade exports will be higher this season and this historically less. Slide 4, represents a brief outlook which has been the main driver of our market. Revenue remains large and accounts for 6%, 9% and 22% of the existing fleet for 2015, 2016 and 2017 respectively.

Due to the weaker market conditions newbuilding orders remain lower in 2015 only $3.4 million dwt or 44 vessels have been ordered in the first half of the year signifying a drop of 93% year-on-year. Therefore, order book for 2018 is close to zero. However, order books remains a big problem.

[Indiscernible] and conversion materialize during this week market period which is the order supplied effect. Our order book versus finally spread 2019 moving on the table on the right bottom of the slide represent the newbuilding deliveries and comparison of the vessels exiting market and going scrap.

Scrapping activity continues such a very high totaling 20 million dwt or 275 vessels year-to-date in comparison to 15.4 million of 2014. During the first half of 2015, deliveries were 26.6 million dwt to 20 million of scrapped vessels. This represent a fleet growth was above 0.5% only, it is forecasted to grow by 2.5% for the full-year.

Capesize fleet is expected to grow by 1% and Panamax by 2% in 2015. Moving on to Slide 5, and the graph represents our fleet order book. Currently, we own a fleet of 36 high specification vessels with an average age of 5.7 years. We have pushed back the delivery of 7 newbuilds vessel delivery program is as fallows.

Three in 2016, three in 2017, one in 2018 and one in 2019. By 2019, one-third of our fleet is expected to be comprised of Eco ships vessels. Turning to Slide 6, we evaluate the performance of our chartering policy against the spot market, which we outperformed most of the time as presented on the bottom graph.

The open days for our fleet including existing fleet and newbuilds are 57% for anticipated ownership days for the remainder of 2015, 87% in 2016 and 90% in 2017. We have a number of vessels opening in the next period and we maintain flexibility in this week capital market.

Going to Slide 7, we present on the bottom graph our daily operating and general and administrative expenses. In G&A we include public company and management fee expenses. In total we paid daily $5,540 to run our vessels in our company for the first half of 2015. This figure includes all cost except depreciation financial expenses.

It is amongst the lowest in the industry and contributes significantly to a relatively low breakeven point which is very important especially during weak markets. On the top graph, we present the average interest rate of 1.85% including the margin for all bank loans and credit facilities during the first half of 2015.

Maintaining low financing cost and preceding our financial flexibility. On Slide 8, on the bottom graph we present our net debt per vessel ratio at 10 million in second quarter of 2015 together with the fleet expansion.

The average age of our fleet is 5.7 years while currently the value of five year old Panamax is about 16.6 million as per the Baltic Exchange sale and purchase assessment Index. Our intension is to maintain comfortable leverage on a net debt per vessel basis and comply at all times with our financial covenants.

As of June 15, 2015 our liquidity was 355.6 million while our capital expenditure requirements were 226.5 million expanding on 2019. Following agreements we are delaying deliveries of seven about [indiscernible]. We have not included [indiscernible] until 2019 providing us with further financial flexibility.

Moving onto Slide 9, our Board has declared a dividend of $0.01 per common share, at the low prevailing market conditions during this year are both adopt a dividend policy to lower levels which will further strengthen our liquidity and balance sheet.

Same markets over a million in dollars in the consecutive quarterly dividends since the company’s IPO in 2008 in line with our policy to reward our shareholders. Our Chief Financial Officer, Konstantinos Adamopoulos will now present our financial results..

Thank you Loukas, and good morning to all of you. On Slide 11, we present selected financial highlights for the first quarter of 2015 compared to the same period of 2014. Net revenues decreased by 15% to $31.8 million from $37.2 million mainly due to the decrease in charter rates.

Interest expense decreased to $9 million to $4,048 compared to $4,455 for the same period in 2014. Net loss was $4.4 million for the second quarter in 2015 from net income of $2.1 million during the same period in 2014.

Adjusted net loss was $3.9 million from the second quarter of 2015 from adjusted net income of $3.2 million during the same period last year. EBITDA decreased by 33% to $10.1 million from $15.1 million. Adjusted EBITDA decreased by 34% to $10.7 million from $16.3 million during the same period in 2014.

Loss per share and adjusted loss per share were $0.10 and $0.09 respectively compared to earnings per share and adjusted earnings per share of $0.01 and $0.02 in the second quarter of 2014, calculated on a weighted average number of 83,470,000 shares to 83,444,000 shares respectively.

Moving on to slide 12, we present definition and reconciliation of our financial fundamental for the second quarter of 2015 compared to the same period of 2014. Slide 13, we present selected operational highlights for the second quarter of 2015 compared with the same period of 2014.

Ownership days increased by 10% available and operating days increased by approximately 11%. We owned and operated an average of 34.14 vessels and achieved a utilization rate of 99.5% compared to an average of 31 vessels and the utilization rate of 98.4%. The average daily time charter equivalent per vessel was $8,615 compared to $11,642.

Moving on slide 14, we present definitions and reconciliation of our operational fundamental for the second quarter compared to the same period of 2014.

As presented in slide 16, our Board of Directors declared for the second quarter of 2015 a cash dividend of $0.01 per common share which is payable on or about August 28, 2015 to shareholders of record at the close of trading on August 18, 2015.

We have declared and paid dividend consecutively in all 29 quarters since our company’s IPO and we’ll continue to be prudent in taking into account market conditions and prospects going forward.

This month our Board of Directors declared a cash dividend of $0.50 per share on 8% series B preferred shares, a cash dividend of $0.50 per share on our 8% series C preferred shares and a cash dividend of $0.80 per share on a 8% series D preferred shares. Each dividend was paid on July 30, 2015.

Summing up our presentation, as the market outlook is still challenging we’re prepared as a long-term oriented company. We’ve been shipping for more than 50 years with our outstanding track record and reputation. We maintain low financial costs as a result of our [low spreads] and our prudent leverage in compliance with our financial covenants.

We have expanded our capital expenditure requirements and liquidity [indiscernible]. We remain committed to further dividend policy to reward shareholders and at the same time ensure future expansion and deleveraging. You may find our contact details in Slide 16, thank you all for listening and we’re now ready to accept questions..

Thank you. [Operator Instructions] Your first question comes from the line of Chris Wetherbee of Citi. Please ask your question..

Good morning. This is [indiscernible] in for Chris.

I guess my first question is on the operating expense that looks like your vessel operating expenses has come down from 2014 I understand you know assume that fuel is a bit of a tailwind, but just wanted to get a sense of is there further room downwards on operating expenses meaning the vessel margins could improve given the rate environment?.

Operating expenses by the number of drydockings and so the second quarter we didn’t have drydocking sold this is an effect of not having any drydocking in this period. While in the first quarter we’ve had three.

Now, I mean we are doing intensified efforts to reduce the capital OpEx and I think I mean if you take out the effect of the drydocking to expect a small reduction in operating expenses. However, the effect of the full-year because we have a substantial number of drydocking could expect a higher number..

Okay, that’s helpful.

And then turning to the market environment on coal with the Indian Counter balance of the Chinese drop how sustainable is that through the year and what's driving that increase in coal demand year-over-year?.

Yes, the coal demand of India is expected to keep increasing for the next few years and they are optimistic that they are coming out of India. On the other hand the coal import to China of the lowest level in the recent years on an annualized fleet of around $200 million funds from $400 million that was at 2013.

Chinese government is heavily interfering with the imports of coal and they are trying to close in certain mines in China and they want the control of the production of domestic coal.

So if we see in 2016 Chinese government not interfering with infrastructure position given the very low price of coal, we expect that we should stop seeing a decline of the imports in China from the current annualized raise of 200 million tons.

We expect a slight improvement in next year, but this it’s all depends whether the government will allow this import substitution to take place..

Okay thanks. And just one last question scrapping activity and now has been very heated so far this year. But seems taken a sequential step down.

Do you expect resumption in accelerated scrapping through the back half of 2015 or these for more normalized levels of we should expect?.

Yes, on the normal circumstances the amount of scrapping for 2015 as already being covered the first six months you know. If the market stabilize the second half of the year we should expect to see less scrapping, but still there would be some ships they cannot avoid scrapping.

Now whether the next year we will see most scrapping it depends on how strong the freight market is, if freight market in the first half of 2016 underperforms again we expect the scrapping to be resumed and most importantly I think there is not scrapping resumed. And most importantly the market underperforms again in the first half of next year.

The good thing out of it will be that the order book will there will be no orders placed like we have this year, India has been very slow on new orders, which give us great potential for 2017 and beyond. You will see order book 2017 and beyond is very, very week.

So hopefully we clear 2016 and we don’t see orders in 2016, because I don’t think we will see order in 2015 either we clear also 2016 without orderings I think that in the subsequent years we should expect any slight improvement of demand to - that will be reflected to improved freight rates..

Hey thank you very much for a very detailed answer. That’s it for me. Thanks..

Thank you..

Thank you. Your next question comes from the line of Shawn Collins of Bank of America. Please ask your question..

Great thank you. Good morning and good afternoon Loukas and Konstantinos..

Hi..

Hi..

Hey, so I believe you delayed the new-builds further this quarter the eight or nine ships I think it looks like you push one to 2019, which is great I think last quarter was pushed out on 2018.

Can you just talk about the talks with the yards and the negotiations with the yards on those delays and if there is any financial penalty involved or any adjustment there that you could comment on?.

Yes, it’s Loukas. That is very confidentiality, closes as we understand was essentially - since a big issue where we are not going to give details of what we have agreed.

And I think that most important is our company is long related with this shipyards, it’s not since 2008, when the company became public, is a long history we started since 30 years ago. We are doing business with yards and there are certain points of time that special consideration has been taken place.

So I think we are using the relations we have with yards to achieve a better result for the company. And we think in this market is prudent, when the possibility is there to push the order books further out as possible. If the market recovers earlier the company has enough ships in the water to make the benefits.

So the - continues to do to keep pushing the order book market..

Okay, understand and understand appropriately, it should be confidential for business reasons, but nice to see that you pushed a little bit further into 2019..

I think this is the most important, but the factor has been achieved..

That’s right absolutely and that’s my focus not on how you got there, just curious. Second question obviously that is the difficult point in the cycle, can you just - and liquidity is very important in the current environment as you have stressed in the past and have done a very great job managing.

Can you just talk about your most recent relationships with the banks and how supportive they have been?.

The banks we have very good relationship, we don’t have any issues, I mean we have 12 banks doing business with the company in all the major ones.

We have good understanding from them and wherever there is need to make any adjustments on terms and that is good to receiving from our bankers with minimal cost to make certain accommodation over a period of the company we consider it’s very strong given that the order book now is pushed up to four years from now.

And on the figures we provide, we have to remind you that those figures do not include revenue on the liquidity side, it does not include the revenue that will be generated from chartering. If you see that even in the lowest quarter of the last 30 years which was their first quarter and second quarter of 2015.

The company also generating cash by having average TCE rates of around 9,000 in those two quarters. This slide spot market was around five, so 9,000 is generating comfortably cash over and above the 5.5 which we saw - running cost including G&A in the management fleet for us is very important to defend this 5.5 and try to improve it if it’s possible.

So we can keep generating cash, so our liquidity - the liquidity does not includes this revenue that would be generating in the next three, four years..

Okay. Understand. Thank you. And can you just - just my last question here.

Is there any region, particular region in the world where activity has surprised you whether it’s on the strength of that activity or possibly with the weakness of that activity and any particular regions standout to you?.

Yes, look the region - I wouldn’t say surprised I would say has performed very well is the coal imports of India which is a steady increase every year, the last few years and also the grain exports from East Coast South America have been very strong this year.

You see also the Atlantic markets has been supporting by this time should southern up to $12,000 a day in the Atlantic market and it looks like the grain will be one of the drivers of Panamax market in the next year.

So we have to keep in mind world population is increasing and [indiscernible] in countries like India, China are increasing China has growth of 8% sorry India has growth of 8%, China 7% so all this people are consuming more food and meat and grain is will be one of the long-term benefits of the market on creating because of the longest distances that they carry flow.

So this two markets I would say then most promising in the next few years..

Okay, understand that. That’s helpful. Thank you very much for the insight..

Thank you..

Thank you and your next question today comes from the line of Fotis Giannakoulis of Morgan Stanley. Please ask your question..

Yes, hello guys and thank you. I would like to ask you about how do you view that the reason I asking the market what were the drivers behind and if you think that we are right now in mode of gradual recovery and whether this recovery you have northeast that is driven apart from declining fleet supply growth also from some improvement in the demand..

The bankers also and you will be low in the first half of the year and especially the first quarter and spilt over the second quarter you know when the grain season start [indiscernible] East coast of America we are expecting market to starting improving. It didn’t happening in May and June it happening towards the end of June beginning July.

It’s already I mean we have seen people becoming optimistic again and second hand prices jumped up by two or three million certain cases. So it doesn’t need a lot for the market to become pessimistic to optimistic and [indiscernible] [0:29:36] to start advising their rates upwards. You remember last year how it’s starting from the tanker market.

Everybody was very pessimistic and one you start seeing that the freight rates you get more higher rates and you start asking for higher rates.

Now I don’t think that we will see any big second half of this year, but we expect that demand will pick up 2.5% in the second half of this year and first half was almost zero, if we’re not declare around zero. So I think that this will support rates of 10,000 in the spot market.

And they are not very defensive, no longer it happens in the first - in 2016, for me 2016 is a good year. If we don’t see ordering happening in 2016, we should call decent expectations for 2017 onwards..

So that does mean that at some point in 2016 provided that there is no increase in the new building activity, we might see you buying more vessels and I’ve seen in the past that you have always ordering new building vessels, given where the asset prices are right now.

If there is no ordering and your expectation for 2017 recovery becomes - that we might start looking on second hand value, that we all know that they have a much higher upside in a potential recovery..

I think the first half of 2016 should be a good time to start investing in second hand vessels, yes..

And this is something that you are willing to entertain or you are going to stick with your new building plans..

New buildings, we have raised new buildings and you have seen we have spread the amount to 2019. We will continue our new building programs in the subsequent years. It don’t expect us to do any new buildings, before we finalize the current building, simply because we don’t throughout the oversupply of the market.

But like we have done in 2012, at lower part of this in the second half of 2012 I expect that the first half of 2016, will be good opportunity to invest in quality second hand tonnage in the market at very attractive prices and hopefully this will be near to a market recovery.

It all defensive, we don’t see ordering activity, we see ordering activity, we are going to - new business, we are not going by second hand and we will try to delay further our new buildings..

I want to ask you also about the concern that the credit risk that the dry bulk market has. We saw in the past the collapse of Korea lines created a lot of uncertainty and volatility in the market.

Today in the news is Nobel Group that might be facing a similar problems, can you comment how important is the chartering portfolio of Nobel if you have any vessels charter they are in kind it means for the overall market if something goes wrong.

And speaking of credit risk also if you can comment on situation of Greece if your operations have by any way been affected by the capital controls there?.

Yes, first of all I don’t believe there are any Korea lines left in the market and we’ll cooperate with them mostly on the spot markets they have first class and they almost pay on time, so our experience has been very good with this company.

And Nobel Group I don’t think it’s anywhere near Korea line they have cargo base behind them and now I don’t know the reports where they are coming from. Now experience has been very positive with them, but we don’t have any exposure any way long-term exposure. And even if we have to been at low market finally so we will then be volatile.

Now, regarding Greece, the situation is not affecting the shipping companies, it is affecting of course everybody living in Greece and the employees of shipping companies the fact that we not have good availability of the overall cash.

Shipping companies, they are longest companies with bank accounts in [indiscernible] or in other financial centers where they are receiving their freight rates and they simply perform their duties and their obligations payment that represent to growing and to agents and to shipyards from all these accounts, so it’s absolutely there is nothing to do with Greek banking system.

So I think we haven’t hear the single owner facing - in Greece the problem to operate ships efficiently at the time. So I think the stories you know they are over played and should sort out the problem you have here is about ships dropping left and right [indiscernible] ship stop anywhere..

Thank you very much, Polys..

Thank you..

Thank you. [Operator Instructions] Our next question this afternoon comes from Amit Mehrotra of Deutsche Bank. Please ask your question..

Yes, it’s Amit Mehrotra from Deutsche Bank. Thank you very much. My first question is on the chartering strategy and specifically spot exposure in 2016 and 2017. If we pass forward six months what will that I guess 87% open days in 2016 look like.

What I am trying to do is just get a sense of how much of the current rate improvement do you plan on locking in maybe as a way to increase some of the visibility and how do you sort of think about that balance between spot and fixed given what you in the rest of the industry have just gone through in the market?.

Yes, look we don’t consider into fix long-term of the current freight rates when the spot market is 8000 and when it was 5000 two months ago. It’s absolutely not going to start fixing long-term.

On the other hand and the opportunity arises we come fix on short periods like six months or even some plans up to one-year simply because you want to put some vessels on the income was the others are working on the spot market.

I would say we comfortably - well comfortable to work 20, 25 ships in the spot market and we have very good networking with our close charters and we are doing business with around 75 top plus names in the spot market. People who perform and they don’t leave balance unpaid.

So we’re happy to work this spot market - let’s a mix from the short period of the one-year period market. For us to fix two years or things like that..

Well, I am talking about 6 months to 12 months so that’s what I’m talking about and so that in terms of that mix and I totally agree with what you are saying, but is there any more detail you can offer in terms of what that mix may look like from a quantitative perspective.

So whether that 87% maybe will move down to 60%, 50% as we look out six months mix of both spot and 6 to 12 months charters..

Yes, 6 to 12 month charters are possible and could possibly go down from 50-50, we have a strong fourth quarter.

Currently we are let’s say 60-40 or 70-30 in favor of the spot because we are having both the opportunity yet to do something, but I think we could easily go to 50-50, but after 12 months we’ll not go and we see some people going for two years. We think is this too short I think to give away money and look away losses for two years..

Okay, that’s very clear. Thank you.

Can I ask just one follow-up on perspective funding that the $172 million of undrawn, but committed loan in credit facility just understanding that correctly is that what you actually expect to dry down based on I guess loan to - the current value of the assets or should we expect the actual dry down to be less given some of the changes maybe in the asset values?.

Look it could little bit higher and could be little bit lower I mean currently the asset prices are going up I would say for good ships could have gone up by $2 million so this [indiscernible] go lower it depends what is the freight market and what is the valuation.

It’s an estimate that we have according to our loan agreements is what we are expecting to grow if there is an average market price. It could be another 5% higher or lower at the end of the day..

Okay, and then I didn’t know I didn’t see this in the presentation, but what are debt amortization payments or any balloon payments if there are any over the next couple of years if you can provide that?.

Information - we don’t have - we don’t know many disclosure dated information during the year..

Okay, I’ll take a look at the filing and thank you all so much for answering my questions. Appreciate it..

Thank you..

Thank you. [Operator Instructions] There appear to be no further questions at this time, please continue sir..

Thank you very much for being with us in this discussion and we are looking forward to discussing again with you now in the next quarter results. Thank you..

Thank you. That does conclude our conference for today. Thank you for participating. You may now all disconnect..