Stocks that Float: TANKERS & DRY BULK SHIPPERS

[xanadu90]

ITCL (NOK8.50 = $1.70) First Quarter 2008 Results

Highlights

# Independent Tankers was established on January 18, 2008.
# Shares in Independent Tankers were registered on the Norwegian over-the-counter market on March 7, 2008.
# Independent tankers reports net income of $3.7 million and earnings per share of $0.05 for the first quarter of 2008.
# In January 2008, BP Shipping Limited extended the charter for the VLCC British Pioneer for one year after the fixed period ends in January 2009. After January 2009, the vessel will trade on a market rate, with a minimum of $20,000 per day.
# In March 2008, Chevron Transport Corporation chose not to declare the termination option for the VLCC Antares Voyager.
# In April 2008, Chevron Transport Corporation chose not declare the termination option for the Suezmax vessel Cygnus Voyager.
# In April 2008, Front Voyager Inc. declared a one year extension of the charter for the Suezmax vessel Front Voyager.

Introduction

Independent Tankers Corporation Limited (the "Company" or "Independent Tankers") was incorporated on Bermuda on January 18, 2008 and the shares have traded on the Norwegian over-the-counter market, since March 7, 2008. Independent Tanker's business is mainly concentrated on the ownership and operation of crude oil tankers on long term bareboat contracts, which include certain cancellation options to major oil companies. Independent Tankers owns or leases six VLCC's and four Suezmax tankers. All vessels are financed through bonds in the US market and some of the vessels are also subject to financial lease arrangements.

First Quarter 2008 Results

The Board of Independent Tankers announces a net income of $3.7 million and earnings per share of $0.05 for the first quarter of 2008. This compares with a net income of $3.1 million and earnings per share of $0.04 for the first quarter of 2007 based on predecessor combined accounts.

The average daily bareboat rate earned by the Company's VLCCs and the Suezmax tanker were approximately $26,100 and $7,800, respectively compared with approximately $26,100 and $7,700, respectively in the preceding quarter.

Net operating income for the first quarter was $10.0 million (2007 comparable quarter predecessor combined accounts: $9.9 million) and net interest expense for the quarter was $6.2 million (2007 comparable quarter predecessor combined accounts: $6.8 million). At March 31, 2008, all of the Company's debt is fixed rate with interest rates ranging from 6.56% to 8.52%.

British Pioneer owned by Buckingham Shipping PLC lease ends on January 15, 2009. The lease obligation of $86.9 million has therefore been classified as a current lease obligation.

As all cash is restricted there was no movement in cash and cash equivalents in the quarter. In May 2008, the Company has an average cash breakeven rate for its VLCCs and Suezmax tanker (Front Voyager) of approximately $21,900 and $4,900 per vessel, respectively.

Charter development

In January 2008, BP Shipping Limited extended the charter for the VLCC British Pioneer for one year after the fixed period ends in January 2009. The vessel will continue to be on a bareboat rate of $24,895 per day until the fixed period is finished in January 2009 and then followed by a market rate with a minimum of $20,000 per day until January 2010.

In March 2008, Chevron Transport Corporation chose not to declare the termination option for the VLCC Antares Voyager and the vessel will continue to be on a bareboat rate of $28,500 per day until December 2010.

In April 2008, Chevron Transport Corporation chose not to declare the termination option for the Suezmax vessel Cygnus Voyager, and the bareboat charter will continue until 2015.

In April 2008, Front Voyager, Inc., a subsidiary of Frontline Ltd., has extended the charter party with Calpetro Tankers (Bahamas III) Ltd. for the single hull Suezmax tanker, Front Voyager, for one year from April 1, 2008 at an average daily bareboat rate of $4,242.

Other Matters

The Board of Independent Tankers has engaged the Vice President Finance in Frontline Management AS Bengt Neteland (35) as the dedicated person to focus on the restructuring process of the Company. Mr. Neteland holds an MSc from the Norwegian School of Economics and Business Administration (NHH) and has worked for Frontline Management AS the last three years.

In May, 2008 the Board of Independent Tankers approved a grant of 1,000,000 share options to Mr. Neteland with a subscription price of NOK 10.0 per share. The options vest one third each year over three years, and the option period is set to five years. In addition, 500,000 share options have been reserved at the same subscription price and will be allocated on the Board's discretion.

74,825,166 ordinary shares were outstanding as of March, 31 2008 and the weighted average number of shares outstanding for the quarter was also 74,825,166.

The Market

The average market rate for VLCCs from MEG to Japan in the first quarter was approximately WS 126 ($86,000 per day) compared to approximately WS 117 ($78,900 per day) in the fourth quarter of 2007. The average rate for Suezmaxes from WAF to USAC in the first quarter was about WS 145 ($47,400 per day), compared to about WS 140 ($45,800 per day) in the fourth quarter of 2007.

Bunkers at Fujairah averaged about $485/mt in the first quarter with a low of about $447/mt and a high of approximately $515/mt.

The International Energy Agency (IEA) reported in May 2008 an average OPEC oil production, including Iraq, of 32.3 million barrels per day during the first quarter of the year, a 0.8 million barrels per day increase from the fourth quarter. The next OPEC meeting is scheduled to take place on September 9, 2008.

IEA further estimates that world oil demand averaged 86.6 million barrels per day in the first quarter, a 0.4 percent decrease from the fourth quarter of 2007. IEA predicts that the average demand for 2008 in total will be 86.8 million barrels per day, or a 1.2 percent growth from 2007, hence showing a firm belief in continued demand growth.

According to Fearnleys, the VLCC fleet totalled 486 vessels at the end of the first quarter with seven deliveries during the quarter. There are 32 additional deliveries expected in 2008. The total orderbook amounted to 184 vessels at the end of the first quarter, up from 177 vessels after the fourth quarter of 2007. The current orderbook represents about 38 percent of the VLCC fleet. Seven VLCCs were deleted from the trading fleet whilst 14 VLCCs were ordered during the quarter. The single hull fleet amounted to 126 vessels at the end of the first quarter.

The Suezmax fleet totalled 339 vessels at the end of the quarter, down from 344 vessels after the fourth quarter of 2007, a 1.4 percent fleet decrease over the quarter. Seven Suezmaxes were deleted from the trading fleet, no Suezmaxes were ordered and two deliveries took place in the quarter. The total orderbook amounted to 134 vessels at the end of the quarter, a decrease of two from the end of the fourth quarter. There are 17 additional deliveries expected in 2008. The orderbook represents approximately 39 percent of the current Suezmax fleet. The single hull fleet amounted to 38 vessels at the end of the first quarter.

Strategy

The Company's strategy will mainly be concentrated around long term charter to reputable companies, for the time being BP Shipping Limited, Chevron Transport Corporation and Frontline Ltd. In order to enhance shareholder value the Company's short and medium strategy would be to focus on restructuring the Company's debt as well as trying to renegotiate charter terms.

Outlook

The quarterly earnings for the remainder of the year will be in line with first quarter of 2008. From January 2009 the Board anticipate stronger results as a consequence of the VLCC vessel British Pioneer coming off a fixed charter rate and staring to trade at a market rate. The Imarex TD3 forward market rate for 2009, as of 28 May 2008, was approximately $76,000 per day, which is favorable compared to present charter of approximately $33,000 (including opex) per day. Further three VLCC vessels will start trading at a market rate during 2010.

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 full report is available in the link below and on the Company's website: http://www.itcl.bm

May 29, 2008
The Board of Directors
Independent Tankers Corporation Limited
Hamilton, Bermuda

Questions should be directed to:
Bengt Neteland: Vice President Finance, Frontline Management AS
[phone] or [phone]

http://hugin.info/138953/R/1223896/258387.pdf

Published: 09:12 30.05.2008 GMT+2 /HUGIN /Source: Independent Tankers Corporation Limited /OSE: ITCL /ISIN: BMG4758V1000