Golden Ocean Group

Earnings Release • Feb 18, 2016

GOGL - Preliminary Fourth Quarter 2015 and Full Year Results

GOGL - Preliminary Fourth Quarter 2015 and Full Year Results

Highlights

·         The Company reports a net loss of $69.3 million and a loss per share

of $0.40 for the fourth quarter of 2015.

·         The Company reports a net loss of $220.8 million and a loss per share

of $1.46 for the year ended December 31, 2015.

·         Excluding one-off items, the adjusted losses in the fourth and third

quarters are $27.6 million and $25.5, respectively.

·         The Company completed the sale of two converted Capesize newbuilding

contracts to Frontline Ltd on December 31, 2015.

·         In November 2015, the Company took delivery of, and simultaneously

sold, the KSL Baltic, and chartered the vessel in for a period of twelve months.

·         In December 2015, the lenders of the $425.0 million term loan facility

agreed to certain amendments to the loan, as increasing the loan to value test,

reducing the profile and adjusting the margin on the loan.

·         In January 2016, the Company took delivery of Golden Barnet, Golden

Bexley, Golden Scape and Golden Swift, two Capesize and two Newcastlemax dry

bulk newbuildings.

·         In January 2016, the Company entered into a Capesize revenue sharing

agreement with three other owners of Capesize vessels.

·         In February 2016, the Company took delivery of, and simultaneously

sold, the KSL Caribbean, and chartered the vessel in for a period of twelve

months.

·         In February 2016, the Company agreed amendments to its bank

facilities, whereby there are no repayments for the next two and a half year and

various covenants are amended or waived, subject to the Company raising $200

million in equity.

Preliminary Fourth Quarter 2015 and Full Year Results

The Company reports a net loss of $69.3 million and a loss per share of $0.40

for the fourth quarter compared with a loss of $40.7 million and a loss per

share of $0.24 for the preceding quarter. The net loss in the fourth quarter

includes (i) a loss on sale of newbuildings and amortization of deferred gain of

$8.5 million (which includes a loss of $8.9 million on the sale of two converted

Capesize newbuilding contracts to Frontline Ltd.), (ii) an impairment loss on

securities of $23.3 million, (iii) a loss provision of $4.7 million against

uncollectible receivables, (iv) an impairment loss of $4.5 million relating to

the Golden Lyderhorn, a vessel held under capital lease, (v) an impairment loss

of $4.6 million relating to the Company's investment in Golden Opus Inc., and

(vi) a mark-to-market gain on derivatives of $3.9 million. The net loss in the

third quarter includes (i) a loss of $2.3 million on the sale of the Capesize

newbuilding, KSL Atlantic, (ii) a vessel impairment loss of $7.1 million, and

(iii) a mark-to-market loss on derivatives of $5.8 million. If these items are

excluded, the adjusted losses in the fourth and third quarters are $27.6 million

and $25.5, respectively.

Vessel earnings fell in the fourth quarter compared to the preceding quarter and

time charter equivalent (or TCE) revenues decreased by $7.9 million due to a

fall in TCE rates partially offset by an increase in trading days. This decrease

was offset by a fall in operating costs of $1.1 million, which was primarily

attributable to a decrease in dry docking costs - three vessels dry docked in

the third quarter compared with one vessel in the fourth quarter.

Cash and cash equivalents decreased by $36.6 million in the fourth quarter. The

main cash movements were the payment of $65.3 million in respect of the

Company's newbuilding program, $46.2 million received from the sale the KSL

Baltic and the repayment of debt of $11.4 million. In addition, $6.2 million was

used in operations.

Agreement on amended financing terms

Over the last 12 months, Golden Ocean has taken several measures to preserve its

liquidity position, including postponement of newbuilding deliveries, sale of

vessels, sale of newbuildings and sale and leaseback agreements. In light of the

continued weak freight markets, the Company has been exploring additional

measures to further preserve and improve its liquidity position to better

position the Company through the current market cycle.

The Company is, therefore announcing further proactive measures to strengthen

its balance sheet, including amendment of all debt facilities, positive

discussions with yards about further postponements of newbuilding deliveries,

and a new equity issue. The refinancing would create a comfortable liquidity

position while preserving an attractive and leveraged exposure to the dry bulk

market. The agreement with the banks is conditional upon the company raising USD

200 million in new equity.

The agreement with the Company's lenders clearly demonstrates the strong support

the Company has from its bank relationships. This, together with the support

from the main shareholder, who have indicated support for subscribing at least

to its pro rata share in the private placement, puts the Company in a strong

position to manage the current down turn in the dry bulk market.

The full report is available in the link below.

February 18, 2016

The Board of Directors

Golden Ocean Group Limited

Hamilton, Bermuda

Questions should be directed to:

Herman Billung: CEO Golden Ocean Management AS

+47 22 01 73 41

Birgitte Ringstad Vartdal: CFO Golden Ocean Management AS

+47 22 01 73 53

Forward-Looking Statements

Matters discussed in this press release may constitute forward-looking

statements.  The Private Securities Litigation Reform Act of 1995 provides safe

harbor protections for forward-looking statements, which include statements

concerning plans, objectives, goals, strategies, future events or performance,

and underlying assumptions and other statements, which are other than statements

of historical facts. Words such as "believe," "anticipate," "intends,"

"estimate," "forecast," "project," "plan," "potential," "may," "should,"

"expect," "pending" and similar expressions identify forward-looking statements.

The forward-looking statements in this press release are based upon various

assumptions.  Although we believe that these assumptions were reasonable when

made, because these assumptions are inherently subject to significant

uncertainties and contingencies which are difficult or impossible to predict and

are beyond our control, we cannot assure you that we will achieve or accomplish

these expectations, beliefs or projections. The information set forth herein

speaks only as of the date hereof, and we disclaim any intention or obligation

to update any forward-looking statements as a result of developments occurring

after the date of this communication.

In addition to these important factors and matters discussed elsewhere herein,

important factors that, in our view, could cause actual results to differ

materially from those discussed in the forward-looking statements include the

strength of world economies, fluctuations in currencies and interest rates,

general market conditions, including fluctuations in charter hire rates and

vessel values, changes in demand in the dry bulk market, changes in our

operating expenses, including bunker prices, drydocking and insurance costs, the

market for our  vessels, availability of financing and refinancing, 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, political events or acts by terrorists, and other important

factors described from time to time in the reports filed by the Company with the

Securities and Exchange Commission.

This information is subject to the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.

[HUG#1987158]