Nordic American Tankers (NYSE

NAT) - The 3Q2018 report - Optimism in the tanker market. Increased rates for the NAT vessels

Hamilton Bermuda, November 12, 2018

Highlights:

• As we had expected, the first half of this year saw the bottom of the tanker market. Our predictions that freight rates for our vessels would rise during the second half of 2018 proved correct.
• At this time spot contract indexes for two out of five suezmax routes for our one million barrel tankers are above $50,000 per day, compared with the first 9 months of 2018, when the freight indexes showed about $6,000 per day.  This is a good illustration of the volatility in freight rates and the potential for earnings in the tanker industry when the tanker market turns.  We believe there could be much more to come. 

We declared $0.01 per share in dividend for the 3^rd quarter on November 1, 2018. This is a reflection of the low market and the subsequent low cash flow during the third quarter of 2018. This is our 85^th consecutive quarterly dividend distribution, a record unparalleled in the tanker industry.  We assure shareholders of our commitment to pay dividends going forward.  

The time charter equivalent for our vessels during 3Q2018 was $12,000 per day per ship.  In 2Q2018 it was $10,500 per day per vessel. Going forward, much higher rates can be expected.

During the third quarter we took delivery of two of our three newbuildings, while the third vessel was delivered to us on October 25, 2018. All three vessels were delivered from a top yard in South Korea, on time and on budget. The adjustments to the fleet have reduced the average age of our fleet.

NAT Net Loss for 3Q2018 (after depreciation, G&A and finance charges) came in at -$38M, including a non-recurring charge of $12.7M. Net Loss for 2Q2018 was -$27.2M. NAT Net Operating Loss for 3Q2018 came in at -$15.3M against -$17.5 in 2Q2018. A better reflection of the performance for the quarter, the Adjusted Net Operating Earnings*, came in at $2.1M for 3Q2018, against $0.8M in 2Q 2018.

Our Net Debt** at the end of 3Q2018 stood at about $313M for the fleet, equaling about $13.0M per vessel, which is attractive. Our net debt per vessel is among the lowest among publicly traded tanker companies and we will work to secure a financial structure in which NAT has no net debt as was the case earlier. 

Later in this report we have included financial information for 3Q2018 and for other periods. 

  ^* Adjusted Net Operating Earnings (Loss) represents Net Operating Earnings or Loss before depreciation, impairment, disposal of vessels (gain/loss) and non-cash administrative charges.