Shareholder Update - Tuesday 16th March 2010 As you know - Julia commenced her Swansea-Cork sailings on 10th March - which of course we are delighted with. You are also probably aware that, despite the thorough checks and maintenance that Julia went through both in Cork and Swansea - the initial sailings have suffered from some mechanical problems - which was very unfortunate. We suspended two sailings over the weekend in order to rectify these issues and we thought that you should be aware of the precise details of these problems. Paul O’Brien, Co-op General Manager travelled on the sailings from Cork to Swansea on Thursday 11th March and the return from Swansea to Cork on the 12th March. Both of these sailings were significantly delayed. On the outward sailing one of the two starboard engines developed a problem, and, while the cause at that time was unknown, the ship was stopped while a tug came out from Cork as a precautionary measure. The sailing was resumed after an hour, but the delay meant that the ferry missed the tide in Swansea and she had to wait to enter the port, so she did not reach her berth in Swansea until 12.30 p.m. on Friday. The fault was subsequently found to be an electronic problem in a governor on the engine and was rectified for the journey back to Cork. Julia was loaded without any problem on Friday night for the return journey, but when the ramp was retracted and folded there was a failure which meant that it was unable to be locked in place. Fastnet Line engineers worked to fix the problem but were unable to do so in time to catch the tide on the way out from Swansea. The problem was traced to an electronic control of the hydraulic system and was also repaired before the crossing commenced on the next available tide which was 1 a.m. Saturday (13th March). The crossing was made in good conditions on four engines and we made good time. However, during the crossing a fault developed in the pitch control on one of the two propellers. The propeller use was unaffected but the pitch control is used under different load conditions and sea states and is also used when berthing. Again this fault was traced to an electronic control which has now been repaired. The fault however was not repaired in time for the Saturday night sailing and so two further sailings on Saturday and Sunday were cancelled. Conor Buckley, Chairman and Padraig Fleming (founder member of the Co-Op), were due to travel on Saturday night and were able to assist our customers affected by the cancelled Saturday night sailing (who were offered free transport to Cork and return journeys via an alternative ferry company).The Julia has been out for sea trials on Monday 15th and Tuesday 16th March and with no further problems is sailing on schedule today Tuesday. The Committee of the Co-Op held its weekly meeting on board the Julia on Monday night, 15th March and received reports from CEO, Tom Barrett and Operations Manager, Owen Barry to discuss recent events. While disappointed with the missed sailings and adverse publicity, we are heartened by the degree of support for the service expressed by the very people who have been affected. The committee plan to have a presence on board each sailing for the next few weeks to help with the bedding in of the service and to speak with passengers to know and understand first hand any! issues which might arise. On a postitive note - we are hearing reports from B&B and Hotel owners in West Cork that suggest that their booking for the 2010 season are already some 30% up on last season - with many potential visitors citing the new ferry service as a major factor in their holiday plans. We are confident that, with this initial bedding-in period out of the way, Julia will be able to operate to schedule and deliver the kind of service that we all expect. Paul O'Brien - Co-op General Manager