Results Q1 - 2014

May 23, 2014

Highlights
Financials
Operations
Macro Update
Q&A

Highlights

GOGL results Q1 2014
EBITDA: \$28.7 million
Profit: \$10.1 million
Earnings per share: \$0.02
GOGL declares a dividend of \$0.025 for Q1 2014
GOGL issued a \$200 million Convertible Bond in January 2014
GOGL purchased three 2012-built Kamsarmax vessels in February 2014
GOGL purchased 50% of Golden Magnum from JV Partner in March 2014
GOGL purchased one iceclass Panamax vessel in April 2014

Financials

Birgitte Ringstad Vartdal, CFO Golden Ocean Management AS

Profit & Loss

Key figures:

(in thousands of \$)

	2014	2013
	Jan-Mar	Oct-Dec
Operating revenue	74 195	70 998
Vessel voyage expenses	-22 260	-14 809
Vessel operating expenses	-12 037	-11 882
Charter hire expenses	-17 735	-15 306
Administrative expenses	-2 784	-2 604
Depreciation and amortisation	-10 333	-10 031
Other gain/ (losses net)	9 360	5 578
Operating profit	18 406	21 945
Interest income	183	207
Interest expense	-7 125	-4 954
Interest swap	-1 712	651
Other financial items	395	434
Taxation	0	-174
Profit for the period	10 147	18 108
Profit attributable to:
Owners of the parent	10 262	17 985
Non-controlling interest	-115	122
Profit for the period	10 147	18 108

More freight voyages compared to TC voyages increase revenues
Voyage related expences and charter hire expences correspondingly higher
Net voyage results are down due to expired CPs, lower market and offhire on docking
Gains on FFA and JV, mainly from the transaction where JV sell and Golden Ocean buy remaining part of Golden Magnum
Negative MtM on interest rate swaps
Higher interest rate costs due to the new Convertible Bond issued in January 2014

Balance Sheet

(in thousands of \$)	2014	2013
ASSETS	Mar 31	Dec 31
Vessels and equipment, net	708 497	667 788
Vessels held under finance leases, net	128 471	130 795
Vessels under construction	26 694	16 144
Investment in Joint Venture	9 534	17 419
Other assets	10 655	11 323
Total non-current assets	883 851	843 469
Cash and cash equivalents	264 701	98 841
Trade receivables and other current assets	50 883	36 270
Refundable installements for cancelled newbuildings	193 664	192 976
Avaiable-for-sale financial assets	16 320	16 916
Total current assets	525 569	345 002
Non-current assets held for sale
Total assets	1 409 420	1 188 471
EQUITY AND LIABILITIES
Equity attributable to equity holders of the parent
Share capital	44 726	44 726
Additional paid in capital	99 156	99 156
Other reserves	51 069	23 551
Retained earnings	452 503	457 823
Non-controlling interest	472	1 108
Total Equity	647 926	626 364
Long term debt	496 990	319 605
Obligations under finance leases	108 604	110 416
Other long term liabilities	1 829 -	1 903 -
Deferred income Total non-current liabilities	607 423	431 924
Current Liabilities
Long-term debt - current portion	86 534	84 414
Obligations under finance leases – current portion	7 496	7 370
Other current liabilities	60 041	38 399
Total current liabilities	154 071	130 183
Total liabilities and shareholders' equity	1 409 420	1 188 471

• Vessels and equipment increased by taking ownership of Golden Magnum

• Vessels under construction contain only payments on Supramaxes • Investment in Joint Ventures reduced by sale of Golden Magnum

• The Convertible Bond has increased cash and debt, and equity portion is allocated to other reserves

• Financial assest include shares in KLC and Greenship

• Debt on cancelled contracts classified as short term

Equity ratio ~ 46 %

Operations

Birgitte Ringstad Vartdal, CFO Golden Ocean Management AS

Vessels: Deliveries and charters

In February 2014 the Company purchased three 2012 Korean built 81.500 dwt Kamsarmaxes in an enblock transaction. The vessels have been delivered to the Company through April and May 2014.
One on index +13% until Q2-2016
One on Time Charter until Q4-2014 at 15,881 \$/d net
One will be open at the end of June 2014
In March 2014 the Company bought the remaining 50% of the JV owning Golden Magnum. The vessel is now wholly owned by Golden Ocean.
In April 2014 the Company bought a resale ice class Panamax vessel to be named Golden Ruby. The vessel is a sister vessel to the Pipavav ice class Panamax vessels and was delivered to the Company in May 2014.

Newbuildings: Delivery schedule supramax vessels

Yard	Vessels	Contracted out	Open	Delivery
JMU (Japan)	2	0	2	Q1-15
Chengxi (China)	6	0	6	Q1-Q2/2015 Q1-Q2/2016

Total newbuilding program consist of 8 Supramaxes
Steel cutting commenced on the JMU vessels and two of the Chengxi vessels
None of the newbuildings are financed
Strong interest from financial institutions for financing of the vessels

Vessel operating expenses

Based on 16 Panamax/Kamsarmax and 7 Capesize vessels
Three vessels have been docked in Q1 2014 and an additional four vessels are due for docking during 2014

Open positions on sailing vessels

Capesize exposure - Sailing vessels Core Fleet *

	2014	2015	2016
Total vessel days	1 675	2 635	2 642
Open vessel days	1 462	2 632	2 638
Open position (%)	87 %	100 %	100 %
Average net rate on fixed days	17 672	na	na
No of vessels	8	8	8
Panamax exposure - Sailing vessels Core Fleet**
	2014	2015	2016
Total vessel days	5 441	8 137	7 730
Open vessel days	3 522	5 852	5 593
Open position (%)	65 %	72 %	72 %
Average net rate on fixed days	15 937	20 234	21 060
No of vessels	24	24	23

* Capesize: MV Golden Magnum included with 100% as from mid March and Golden Opus included with 50%

** Panamax: Golden Ruby included from early May 2014

Jinhaiwan situation

All nine contracts cancelled
USD 175.3 million in installments to be refunded
USD 43.2 million in debt on the installements
Interest accrue on the installments at a rate of 5%
Hearings are concluded in all nine arbitrations
Three final awards obtained
Two preliminary awards obtained (wait for award on payment)
Waiting for awards in four arbitrations
Payment on first two awards expected within a few weeks
The Board is confident that the Company has a strong case on all arbitrations

Corporate transactions

Convertible Bond
In January the Company issued a \$200 million Convertible Bond with a 5 year tenor
Coupon of 3,07% p.a
Current Conversion Price is 2.82 \$/share
Full dividend protection for Bond holders
The Company has bought four vessels which are delivered to Golden Ocean in April and May. These vessels are currently funded with the proceeds from the Convertible Bond.
The Company will consider to delist from the secondary listing on SGX. This does not affect the Company's presence in the Asian shipping market.

Macro Update

Herman Billung, CEO Golden Ocean Management AS