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Nordic American Tankers Limited: Nordic American Tankers' 4Q2015 Report (NYSE:NAT) - NAT is very different from other tanker companies. Operating Cash Flow ros

Link to the complete 4th Quarter 2015 report:

Hamilton, Bermuda, February 8, 2016

Transparency is a key value for NAT. Communication with the public market must
be correct, representing facts and the best judgement of the Board of
Directors and management. Since the establishment of NAT almost 20 years ago,
the Company has pursued a well-tested strategy that has produced high total
return and dividend yields to the benefit of shareholders. Thanks to a cash
break-even rate below $12,000 per day per ship, a growing NAT Suezmax fleet
and achieved spot rates of about $39,800 per day, 4Q2015 produced good
results with operating cash flow of $57.2m. For the full year 2015 operating
cash flow[1]was $212m - the strongest year in NAT's history. For further
details on the preceding quarters please see the table on page 3. The Company
believes it is not meaningful to compare quarter on quarters as longer
periods are required to gain a full picture. So far, 1Q2016 is progressing
well. Operating Cash Flow rose 16% in 4Q2015 compared with 3Q2015.

NAT has an excellent relationship with our demanding clients. The quality of
the NAT fleet is at the top of the tanker industry as evidenced by our
vetting statistics, that is, inspections of our ships by clients. In such
processes safety for our crew, the environment and our assets are main
considerations. Renewal of our fleet is always on the agenda. Whether a ship
is 5, 10, 15 years or more is not the focus - quality matters.

There is a significant liquidity in the NAT stock, at the top in the tanker
sector. It is our objective for investors to be able to buy and sell shares
related to the crude tanker market whenever they wish. In 4Q2015 about 1.8
million shares were traded daily, with more than $27m worth of shares
changing hands every day. The average volume for 2015 as a whole was also
about 1.8 million shares per day, an increase of almost 40% from 2014. The
market capitalization of NAT is about $1.0 billion at this time. Net Asset
Value (NAV), or the steel value of a vessel, is completely irrelevant when
valuing NAT as a going concern traded on the stock exchange.

On January 13, 2016, NAT declared a cash dividend of $0.43 per share payable
to shareholders of record as of January 27, 2016. Payment of the dividend is
expected to take place on or about February 10, 2016. Since NAT commenced
operations in the fall of 1997, the Company has paid a dividend 74 times,
with total dividend payments over the period amounting to $46.97 per share,
including the dividend to be paid on February 10, 2016.

The low oil price is an important positive factor for the tanker market. Since
mid-2014, oil prices have decreased significantly, positively impacting
Suezmax tanker rates.

Key points to consider:

* Tanker rates achieved on average for 4Q2015 were about $39,800 per day per
vessel. In 3Q2015 and 4Q2014 the spot rates were about $35,000 and $24,000
per day per ship, respectively.
* Operating Cash Flow per share has been as follows: $0.64 for 4Q2015, $0.55
for 3Q2015 and $0.27 for 4Q2014
* Dividend payments per share have been as follows: $0.43 for 4Q2015, $0.38
for 3Q2015 and $0.22 for 4Q2014.
* Earnings per share (EPS) has been: $0.34 for 4Q2015, $0.29 for 3Q2015 and
-$0.04 for 4Q2014.
* The balance sheet was strengthened in 4Q2015 as we retained about $18.9m of
operating cash flow during the quarter to finance future commitments,
including our newbuildings.
* In December 2015 NAT announced an expanded credit facility up to $500m,
maturing in December 2020.
* The undrawn part of our credit facility plus net working capital stood at
about $267m at the time of this report. At the end of 4Q2015, the Company
had net debt of about $8.8m per vessel.
* NAT currently has 24 vessels on the water and two newbuildings. No equity
offerings are planned in conjunction with this 26 vessel fleet.
* The two newbuildings for delivery in 3Q2016 and 1Q2017 are on schedule.

Nordic American Tankers is
different from other tanker companies.

For a variety of reasons, NAT has an operating model that has proven itself to
be sustainable in both a weak and a strong tanker market. Accretive fleet
growth, low net debt per vessel and quarterly dividend payments are central
elements of the strategy. NAT has one type of vessel - the Suezmax vessel -
that can carry one million barrels of oil. A homogenous fleet reduces our
operating costs, which helps to keep our cash-breakeven below $12,000 per day
per vessel.

Financial Information

The Company declared a cash dividend of $0.43 on January 13, 2016, which is
expected to be paid about February 10, 2016 to shareholders of record as of
January 27, 2016. The number of NAT shares outstanding at the time of this
report is 89,319,666, after the issuance of 137,665 restricted shares in
January 2016 to management and officers of NAT, spread across 30 persons. At
this time the market capitalization of NAT is about $1.0 billion. Quarterly
dividend payments will continue to be a central part of our strategy.

The Company's operating cash flow in 4Q2015 was $57.2m. In 3Q2015 and 4Q2014
operating cash flow was $49.1m and $24.5m, respectively.

Earnings per share (EPS) in 4Q2015 were $0.34. In 3Q2015 and 4Q2014 the EPS
were $0.29 and -$0.04, respectively. EPS does not take into account risk and
as such, it could be a deceptive measure.

We had a total of 207 days offhire during the quarter, of which 130 days were
planned offhire. The offhire includes positioning time to and from the ship
yard. In 2016 eight vessels are expected to undergo drydocking.

As a matter of policy and in particular because of high volatility in the
tanker market, NAT maintains a strong balance sheet with low net debt and
focuses on keeping low financial risk. At the end of 4Q2015, the Company had
net debt of about $230m or about $8.8m per vessel.

Link to the graph:
The table on the right shows our cash flow, stock liquidity and dividend over
the last eight quarters. During 2015, the Company had significantly stronger
cashflow than during the preceding years. Liquidity in the stock is high
compared with other tanker companies.

Our primary objective is to enhance total return[2]for our shareholders,
including paying a quarterly dividend.

The Company has in place a non-amortizing credit facility of $500m maturing in
December 2020, of which $330m has been drawn. At the time of this report,
cash on hand is about $54m. Net working capital and undrawn amounts of the
credit facility amount to about $267m.

For further details on our financial position for 4Q2015, 3Q2015 and 4Q2014,
please see later in this release.

The G&A costs of NAT benefit from resource sharing with Nordic American
Offshore Ltd. (NAO). As our respective fleets grow, both companies benefit.
Further growth should result in lower costs on a per vessel basis. NAT's
investment in NAO is accounted for using the equity method. The reduced level
of the oil price has impacted the operations of NAO negatively. During 4Q2015
NAT increased its ownership in NAO to about 27%. The market value on the
stock exchange of NAT's share in NAO is lower than the book value. We expect
this to be temporary.

The Fleet

The Company has a fleet of 26 vessels of which two are under construction. By
way of comparison, in the autumn of 2004, the Company had three vessels. Our
vessels are in excellent technical condition.

As reported earlier, in the arbitration case against Gulf Navigation Holding
PJSC (GNH) regarding the Suezmax vessel Gulf Scandic (now named Nordic
Harrier) NAT was awarded $10.2m plus interest and costs. GNH is listed on the
Dubai Financial Market (DFM) stock exchange in Dubai. We are now hopeful that
this matter will be closed.

NAT is focused on maintaining top technical quality of the fleet. Our
operational performance remains at the forefront of the industry. 4Q2015
inspections had an average of 2.9 observations which we consider an excellent
result. NAT's performance can be considered industry best practice.

World Economy and the Tanker Market

The development of the world economy affects the tanker industry. Seaborne
imports of crude oil into the US have decreased over the recent past. Going
forward, shale oil and oil sand projects are expected to affect the US and
Canadian oil sector. Some of these projects are vulnerable to reduced oil
prices as we see at the time of this report. In terms of transportation work
(ton miles), the reduced imports to the US are more than outweighed by the
increased imports to the Far East. European crude imports have recently shown
a rising trend. A low oil price is stimulating the world economy which is
positive for the tanker market.

Tanker market rates are also affected by newbuildings that enter the markets,
increasing the supply of vessels. Scrapping impacts supply in the other

The Suezmax fleet (excl. shuttle tankers) counts 455 vessels at the end of
4Q2015, following an increase of ten vessels this year.
A number of orders have been placed with the shipbuilders in the past year.
The current orderbook stands at 95 vessels from now to late 2017. This
represents about 21% of the Suezmax fleet. In 2009, the orderbook was at over
50% of the existing fleet. At the time of this report, the orderbook for 2016
counts 39 Suezmax vessels, with 32 vessels scheduled to be delivered in the
second half of the year. However, we expect the real number of deliveries for
2016 to be lower.

Link to the graph:
The graph above shows the average yearly spot rates since 2000 as reported by
R.S. Platou Economic Research a.s.The daily rates as reported by shipbrokers
may vary significantly from the actual rates we achieve in the market, but
these rates are in general an indication of the level of the market and its

Corporate Governance/Conflict of Interests

It is vital for NAT to ensure that there is no conflict of interests among
shareholders, management, affiliates and related parties. Interests must be
aligned. From time to time in the shipping industry, we see that
questionable transactions take place which are not in harmony with sound
corporate governance principles, both as to transparency and related party

Strategy going forward

Our objective is to have a strategy that is flexible and has benefits in both
a strong tanker market and a weak one. In an improved market, higher
earnings and dividends can be expected. The Company is in a position to

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