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2014-05-28

Independent Tankers Corporation Limited: ITCL - First Quarter 2014 Results

Highlights

* Independent Tankers reports a net loss of $18.5 million, equivalent to a
loss per share of $0.25, for the first quarter of 2014.

* Independent Tankers reports a net loss of $2.7 million for the first
quarter of 2014 when excluding loss on the sale of vessels, equivalent to a
loss per share of $0.04.

Introduction

Independent Tankers Corporation Limited (the "Company" or "Independent
Tankers") was incorporated in Bermuda on January 18, 2008 and the shares have
traded on the Norwegian over-the-counter market since March 7, 2008.
Independent Tankers' business is mainly concentrated on the ownership and
operation of crude oil tankers on long term bareboat contracts to major oil
companies and has three vessels operating in the spot market. Independent
Tankers owns five VLCC's and three Suezmax tankers. All vessels are financed
through bonds in the U.S. market. The main shareholder is Frontline Ltd.
("Frontline") with an ownership of approximately 83 percent.

First
Quarter 2014 Results

The Board of Independent Tankers announces a net loss of $18.5 million,
equivalent to a loss per share of $0.25, for the first quarter of 2014. This
compares with a net loss of $5.8 million, equivalent to a loss per share of
$0.08, for the preceding quarter. The net loss in the first quarter includes
a loss on the sale of the Ulysses of $15.7 million. The average daily time
charter equivalent rate earned in the first quarter by the VLCCs trading in
the spot market was $26,100 compared with $13,100 in the preceding quarter.
The average daily bareboat rate earned in the first quarter by the Company's
VLCCs was $20,000, which was the same as in the preceding quarter.

In May 2014, the average cash breakeven rate for the remaining part of 2014 is
approximately $32,600 per day for the three spot trading VLCCs and $21,300
per day for the two VLCCs on bareboat charters.

Other Matters

The VLCC Ulysses was sold in March to an unrelated third party for net sale
proceeds of $25.5 million and was delivered to the buyer on March 11.

The VLCC Progress (ex-British Progress) was redelivered to the Company from
its bareboat charter with BP Shipping Ltd. on March 12 at which time the
vessel commenced trading in the spot market.

74,825,166 ordinary shares were outstanding as of March 31, 2014, and the
weighted average number of shares outstanding for the first quarter was also
74,825,166.

The Market

The market rate for a VLCC trading on a standard 'TD3' voyage between the
Arabian Gulf and Japan in the first quarter of 2014 was WS 51, representing a
decrease of WS 2 point from the fourth quarter of 2013 and WS16 above the
first quarter of 2013. The flat rate decreased by 6.7 percent from 2013 to
2014.

Bunkers at Fujairah averaged $611/mt in the first quarter of 2014 compared to
$615/mt in the fourth quarter of 2013. Bunker prices varied between a high of
$627/mt on January 15th and a low of $599/mt on March 12th.

The International Energy Agency's ("IEA") May 2014 report stated an OPEC crude
production of 30.0 million barrels per day (mb/d) in the first quarter of
2014. This was an increase of 0.2 mb/d compared to the fourth quarter of
2013.

The IEA estimates that world oil demand averaged 91.3 mb/d in the first
quarter of 2014, which is a decrease of 1.1 mb/d compared to the previous
quarter. IEA estimates that world oil demand in 2014 will be 92.8 mb/d,
representing an increase of 1.5 percent or 1.4 mb/d from 2013.

The VLCC fleet totalled 627 vessels at the end of the first quarter of 2014,
four vessels up from the previous quarter. Five VLCCs were delivered during
the quarter, one was removed. The order book increased by 12 vessels and
counted 94 vessels at the end of the first quarter, which represents 15
percent of the VLCC fleet.

Strategy and Outlook

The Company's fixed rate charter coverage for its five double hull VLCCs in
2014 is 11 percent, while the charter coverage for the three double hull
Suezmax tankers is 100 percent until 2015.

Following the termination of the bareboat charters for the VLCCs Ulriken,
Pioneer and Progress in 2010, 2011 and 2014 respectively, these vessels are
trading in the spot market and are exposed to earnings fluctuations. During
2014, all the Company's VLCCs will be exposed to the spot market fluctuations
as the British Pride will be redelivered from BP in July, and the British
Purpose charter is converted from the Minimum Rate Period to the Variable
Rate Period in July 2014 in accordance with the terms of the charter
agreement with BP.

The Company's assets are financed through the US bond market with maturities
from 2015 to 2021. The fixed minimum bareboat rates of $20,000 per day for
two of the Windsor Petroleum VLCCs supports the debt of these vessels until
the charters expire in 2014. However, with recent earnings being lower than
the cash break even rates for the spot trading vessels, the Company will have
to draw on the restricted cash reserves to operate these vessels. Continued
operation in the spot market at rates that do not support the debt of the
vessels increases the risk of the Company and will have a negative influence
on the Company's future earnings and credit profile if low spot rates
continue.

The broker valuations received for the vessels at March 31, 2014 indicate that
the market values of the Windsor vessels are lower than the net debt of the
vessels. The VLCC Ulriken in the Golden State bond structure had estimated
market value lower than the net debt of the vessel. Whether the estimated
market values can be achieved through actual transactions is highly uncertain
due to the lack of liquidity in the secondhand sale and purchase market for
VLCCs.

Forward Looking Statements

This press release contains forward looking statements. These statements are
based upon various assumptions, many of which are based, in turn, upon
further assumptions, including the Company's management's examination of
historical operating trends. Although the Company believes that these
assumptions were reasonable when made, because assumptions are inherently
subject to significant uncertainties and contingencies which are difficult or
impossible to predict and are beyond its control, the Company cannot give
assurance that it will achieve or accomplish these expectations, beliefs or
intentions.

Important factors that, in the Company's view, could cause actual results to
differ materially from those discussed in this press release include the
strength of world economies and currencies, general market conditions
including fluctuations in charter hire rates and vessel values, changes in
demand in the tanker market as a result of changes in OPEC's petroleum
production levels and world wide oil consumption and storage, changes in the
Company's operating expenses including bunker prices, drydocking and
insurance costs, changes in governmental rules and regulations or actions
taken by regulatory authorities, potential liability from pending or future
litigation, general domestic and international political conditions,
potential disruption of shipping routes due to accidents or political events,
and other important factors described from time to time in the reports filed
by the Company with the Norwegian over-the-counter market in Oslo.

The Board of Directors
Independent Tankers Corporation Limited
Hamilton, Bermuda
May 27, 2014

Questions should be directed to:

Aage Kr. Korff Østern:
Vice President Finance,
Frontline Management AS
+47 23 11 40 52

1st Quarter 2014 Results
http://hugin.info/138953/R/1789033/614837.pdf

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This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Independent Tankers Corporation Limited via Globenewswire

HUG#1789033

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