Havila Shipping ASA

Earnings Release • Feb 28, 2017

Havila Shipping ASA: Fourth quarter 2016 accounts/Preliminary 2016 accounts

Havila Shipping ASA: Fourth quarter 2016 accounts/Preliminary 2016 accounts

General information

The interim accounts are prepared in accordance with IAS 34 Interim Financial

Reporting and are unaudited. The report should be read together with the annual

report for 2015. Figures in parentheses relate to corresponding periods for

Havila Shipping ASA has since 4th quarter 2015 been in negotiation with the

financial creditors to obtain a financial restructuring of the group. The

restructuring is mainly executed on 28 February 2017, and will be implemented in

the financial statements for 1st quarter 2017.

Subscription in the repair issue will start immediately after the private

placement is executed.

For detailed information it is referred to the Stock Exchange Release regarding

the financial restructuring available at the homepage www.havilashipping.no.

Main elements of the restructuring

· NOK 77.0 million of new equity, NOK 41.2 million of "Anti-Dilution Protection

loan" and NOK 46.2 million of convertible shareholder loan.

· Secured creditors to convert NOK 135.0 million to shares.

· Repair issue of up to NOK 30 million.

· Unsecured debt amounting to NOK 950 million and accrued unpaid interest

related to the debt to be repaid in full by 15% cash payment and certain

warrants.

· Vessels divided into core and non-core vessels, where non-core vessels will be

disposed for sale.

· Estimated loss on sale of the seven non-core vessels in addition to the vessel

which was sold before year-end is NOK 322.3 million, and will be booked as

reduction of the relevant debt and increase of equity accordingly at

implementation of the restructuring.

· Reduced amortisation obligations for the next four years. Minimum fixed

amortisation is reduced to approximate NOK 67 million for the period 2017-2019.

Total amortisation is limited to 50% of net cash flow from cash flow positive

vessels.

· Suspended financial covenants save for minimum cash of NOK 50 million.

· Others as stated in the term sheet.

Summary of direct effects of the restructuring:

· Increase in equity of NOK 1.529 billion.

· Reduction in debt to secured and unsecured creditors of total NOK 1, 285

million.

· Reduction in other short term debt NOK 356 million.

· Reduction in cash of NOK 112 million.

Summary

Havila Shipping ASA achieved an operating income before depreciation of NOK 103

million in Q4 2016, compared with NOK 167 million in Q4 2015.

Total operating income was NOK 245 million in Q4 2016, compared with NOK 362

million in Q4 2015.

Impairments of vessel values and capitalized maintenance costs of total NOK 901

million were made in Q4 2016 (NOK 1, 388 million in Q4 2015).

The group sold one of the PSV vessel in November 2016 with limited effect on the

Group's result.

The group had 27 vessels in operation as of 31/12/2016. 23 vessels are operated

from Fosnavåg, one for external owner. Four of the vessels are operated by the

50 % owned company in Singapore, Posh Havila Pte Ltd. As a part of the

restructuring, these vessels will be sold and the company winded up.

The Group had 6 vessels laid up at the beginning of fourth quarter. At the end

of October vessel number 7 was laid up, and in the beginning of November one of

the laid-up vessels was sold. Further three vessels were laid-up in December.

Today, the Group has 9 vessels laid up, of this 5 PSV, 3 AHTS and 1 subsea

vessel. In addition is one of the subsea vessel marketed for work after ended

contract. The subsea vessel which has been laid-up since 1 January 2016, has got

a 3 year contract and will after stay at yard and mobilization be ready for

operation in the beginning of April 2017.

The fleet utilization was 65 % in Q4 2016, 89 % exclusive lay up vessels.

Contacts:

CEO Njål Sævik, +47 909 35 722

CFO Arne Johan Dale, +47 909 87 706

This information is subject to the disclosure requirements pursuant to section

5 -12 of the Norwegian Securities Trading Act.