Saga Pure — Interim / Quarterly Report 2014

Feb 27, 2015

Q4 2014 REPORT

CONTENTS

FINANCIAL INFORMATION

Highlights > Responsibility Statement > Consolidated condensed statement of comprehensive income > Consolidated condensed statement of financial position > Consolidated condensed cash flow statement > Consolidated condensed statement of changes in equity > Notes to the financial statements >

HIGHLIGHTS

KEY FIGURES

NOK 1000	Oct-Des 2014 (unaudited)	Oct-Des 2013 (unaudited)	Jan-Des 2014 (unaudited)	Jan-Dec 2013 (unaudited)
Operating revenue	$-4546$	67	$-1057$	3 3 3 4
Operating profit (-loss) before depreciation (EBITDA)	2498	855	1572	2560
Operating profit/(-loss) (EBIT)	1782	855	225	2560
Net profit/(-loss)	2341	2617	830	4329
Total comprehensive income	2 3 4 1	20 164	$-38469$	40775
Basic and diluted earnings per share to the shareholders in the parent company NOK	0,01	0,03	0,00	0,05

RESULTS

Saga Tankers group reports a net total comprehensive income for the fourth quarter 2014 of NOK 2.3 million.

EBITDA for the fourth quarter was NOK 2.5 million.

Earnings per share (EPS) for the fourth quarter were NOK 0.01.

The major items in the result of fourth quarter is an impairment of investment in S.D. Standard Drilling plc of NOK 8.9 million, and a exchange gain on USD bank deposits of NOK 12.0 million classified as Other financial items.

The average number of shares in the quarter was 175,833,728. As per the end of the period, the outstanding number of shares was 175,833,728.

The Group's condensed unaudited financial statements for the fourth quarter of 2014 are enclosed.

Current Investments

The Group currently holds investments in of 49,680,082 shares in S.D Standard Drilling PLC classified as financial assets held for sale. An impairment loss of NOK 8.9 million was recognized on this investment in fourth quarter. The Group's investment in Vallhall is classified as subsidiaries with minority interest. The Vallhall investment contributed with a net profit of NOK 0.2 million, including NOK 0.1 million to non-controlling interest in fourth quarter.

The Group has a cash holding of NOK 297.7 million.

Future

The Group will continuously evaluate investment opportunities that may arise based on the present framework surrounding the industries in which it operates.

Whether the Group will invest in asset or equity depends on investment opportunities that may arise as well as the equity and funding market at the time being. The Company does not rule out investing in debt related instruments in industries in which the Company operates.

On 30 January 2015, the Group signed a letter of intent with Strata Marine & Offshore AS regarding the possible merger or acquisition of 100% of the

outstanding shares in Strata Marine & Offshore AS. The mergerplan was approved by the board of directors 26. February 2015. The structure and commercial terms for the proposed transaction is described in the press release published on Oslo Axess 26 February. A detailed stock exchange announcement regarding the transaction will be released within 3 trading days according to the Continuing Obligation of stock listed companies section 3.5.4.

STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Matters discussed in this report may constitute forward looking statements. The forward looking statements in this report are based on various assumptions, many of which are based upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable made, when because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult to predict and beyond our control, we

cannot assure you that we will achieve or accomplish these expectations, beliefs or projections.

Oslo, 26 February 2015

The Board of Directors

RESPONSIBILITY STATEMENT

We confirm, to the best of our knowledge, that the financial statements for the period 1 January 2014 to 31 December 2014 have been prepared in accordance with IFRS, as adopted by the EU, and give a true and fair view of the Group and the Company's consolidated assets, liabilities, financial position and results of operations. Furthermore, we confirm that the Report of the Board provides a true and fair view of the development and performance of the business and the position of the Group and the Company, together with a description of the key risks and uncertainty factors that the Company is facing.

Oslo, 26 February 2015 The Board of Directors

Chairman

Martin Nes Board member

Espen Lundaas

CEO

Board member

CONSOLIDATED CONDENSED STATEMENT OF COMPREHENSIVE INCOME

		Oct-Dec		Jan-Des
NOK 1000	Oct-Dec 2014	2013	Jan-Dec 2014	2013*
	(Unaudited)	(Unaudited)	(Unaudited)	(Audited)
Net gain / (loss) from available for sale assets	$-8942$	$-125$	$-9136$	3 2 7 6
Other income	4 3 9 6	58	8079	58
Operating revenues	$-4546$	$-67$	$-1057$	3 3 3 4
General administrative and operating expenses	4942	993	11 388	4 2 3 6
Depreciation/Amortization (Note 2)	715		1347
Other losses/(gains)			3 1 6 2	$-53$
Operating expenses	5657	993	15896	4 1 8 2
Operating profit/(-loss)	$-10203$	$-1060$	$-16953$	$-847$
Interest income	1 1 6 7	1762	1813	1769
Interest expense	$-519$		$-1120$	$-2$
Other financial items	11986	842	16 4 25	2 3 3 6
Net financial items	12 633	2 6 0 3	17 118	4 1 0 3
Share of profit from associates		1074	753	1074
Profit/(-loss) before tax	2 4 3 0	2617	918	4329
Taxes	88		88
Net profit/(-loss)	2341	2617	830	4329
Change in available-for-sale assets		17547	$-39479$	36 4 46
Other comprehensive income		17 547	$-39479$	36 446
Total comprehensive income	2341	20 164	$-38649$	40775
Attributable to:
Non-controlling interests	94		419
Shareholders' interests	2 2 4 7	20 164	$-39069$	40775
Basic and diluted earnings per share to the shareholders of the parent company NOK	0.01	0.03	0.01	0.05
Average number of shares in the period	175 833 728	86 777 409	131 305 569	86 777 409
Number of shares outstanding at period end	175 833 728	86 777 409	175 833 728	86 777 409

*Impairment on available for sale assets of TNOK 17 523 accumulated was presented as a separate item in the interim reporting in 2013. This is now included in the net gain (-loss) from available for sale assets.

CONSOLIDATED CONDENSED STATEMENT OF FINANCIAL POSITION

NOK 1000	31.12.2014	31.12.2013
	(Unaudited)	(Audited)
ASSETS
Non-current assets
Deferred tax assets	1
Fixed assets (note 2)	94 5 65
Available-for-sale financial assets (note 5)	53 158	99 731
Associates		15 0 74
Total non-current assets	147 723	114 805
Current assets
Trade receivables	622
Other current assets	1 2 2 7	65
Cash and cash equivalents	297 729	102 864
Total Current assets	299 579	102 930
TOTAL ASSETS	447 302	217735
EQUITY AND LIABILITIES
Equity
Share capital	175 834	86777
Other Equity	883 696	883 696
Total paid-in-capital Accumulated losses	1059530	970 473
	$-694519$	-790 117
Other components of equity	$-2648$	36831
Non-controlling interests	24 041
Total equity	386 404	217 187
Non-current liabilities
Long term interest bearing debt	58 000
Total non-current liabilities	58 000
Current liabilities
Tax payable	43
Other current liabilities and accruals	2856	548
Total current liabilities	2899	548
TOTAL EQUITY AND LIABILITIES	447 302	217 735

CONSOLIDATED CONDENSED CASH FLOW STATEMENT

NOK 1000	Jan-Dec 2014	Jan-Dec 2013
	(Unaudited)	(Audited)
Profit before tax	918	4 3 2 9
Profit share from associates	$-753$	-1074
Depreciation	1347
Impairment charge	17 173	17523
Loss/(gain) on Available-for-sale financial assets	$-8037$
Other losses/(gains)	3 1 6 2	$-53$
Foreign exchange losses/(gains)	$-16425$	$-2334$
Increase/decrease receivables and prepayments	417	73
Increase/decrease payables and accruals	130	$-18957$
Net cash flow from operating activities	$-2070$	$-493$
Investment in Available-for-sale financial assets		- 66 468
Divestment in Available-for-sale financial assets	167 449	20 308
Net payment from/(to) associates	3 4 4 7
Cash holdings in new subsidiaries	12044
Proceeds from sale of other fixed assets		331
Investment in fixed assets	$-318$
Net cash flow from investing activities	182 622	-45 829
Repayments of long term borrowing	$-1652$
Share issuance costs	$-462$
Net cash flow from financing activities	$-2114$
Net change in cash and cash equivalents	178 440	$-46322$
Cash and cash equivalents at beginning of period	102864	146 852
Cash and cash equivalents at end of period	297 729	102864
Net foreign exchange difference (unrealized)	16425	2 3 3 4

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Jan-Dec 2014 (Unaudited)
NOK 1000	Share capital	Other equity	Accumulated losses	Available for sale financial assets reserve	Exchange difference currency translations	Non- controlling interest	Total
Equity as at 1 January 2014	86777	883 696	-790 117	39 479	$-2648$	٠	217 187
Net profit/(-loss)	-	$\overline{\phantom{a}}$	410			419	830
Other comprehensive income	٠	$\overline{\phantom{a}}$	$\blacksquare$	$-39479$	$\overline{\phantom{0}}$	٠	$-39479$
Total comprehensive income	٠	۰	410	$-39479$		419	$-38649$
Demerger 1 July	89056	۰	95 650	$\overline{a}$		23 621	208 327
Share Issuance costs	-	-	$-462$	-	$\blacksquare$	-	$-462$
Equity per ending balance 31 December 2014	175833	883 696	$-694519$	۰	$-2648$	24 041	386 404

2013 (Audited)
NOK 1000	Share capital	Other equity	Accumulated losses	Available for sale financial assets reserve	Exchange difference currency translations	Total
Equity as at 1 January 2013	86777	883 696	$-794446$	3033	$-2648$	176 411
Net profit/(-loss)	-	٠	4329		-	4329
Other comprehensive income			۰	36446	۰	36 4 46
Total comprehensive income		۰	4329	36 4 46	٠	40775
Equity per ending balance 31 December 2013	86777	883 696	-790 117	39 479	$-2648$	217 187

NOTES

NOTE 1 - BASIS FOR PREPARATION

The Company's condensed interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting as approved by the EU and requirements in the Norwegian Securities Trading Act. This condensed interim financial statement for the fourth quarter is adopted by the Board of Directors on 26 February 2015.

The accounting policies adopted in the preparation of the condensed interim financial statements are consistent with those presented in the Annual Report of 2013. Available for sale financial assets are measured at fair value. Changes in fair value are booked as other comprehensive income provided that no impairment is present.

Foreign currency

The financial statements are presented in NOK. NOK is also the functional currency for all the companies in the Group.

NOTE 2 - FIXED ASSETS

		Machinery and	Other assets and activated	Total
NOK 1000	Buildings	equipment	costs
Acquisition cost, 1 January 2014
Assets received through demerger	91 3 52	7004	237	95 593
Additions		318		318
Acquisition cost, ending balance 31 December 2014	91 3 52	4322	237	95 911
Accumulated depreciation, 1 January 2014
Depreciation	$-1147$	$-200$		$-1347$
Accumulated depreciation, ending balance 31 December 2014	$-1147$	$-200$		$-1347$
Net carrying amount, ending balance 31 December 2014	90 206	4 1 2 2	237	94 565

NOTE 3 - OPERATING SEGMENTS

The Group is investing in financial instruments traded in active markets. These are further described in note 5.

For management purposes, the Company's business is not organized into separate operating segments and hence only has one reportable operating segment which is in line with the consolidated figures presented in this report. Group financing is also monitored on a Group basis.

NOTE 4 - SAGA AGNES CLAIM SUMMARY

As informed in the annual report for 2013, the Charterers of Saga Agnes AS has presented the Group with a claim of about USD 2 million related to the time charterparty for the vessel "Saga Agnes". The matter will be resolved through arbitration if required by the counter party. The Group has made no provisions for this claim as it is considered to be unsubstantiated.

NOTE 5 - AVAILABLE-FOR-SALE FINANCIAL ASSETS

		2014	2013
At 1 January		99 731	34 648
Additions			66 4 68
Assets received through demerger		65 089
Impairment		$-17173$	$-17523$
Change in available-for-sale financial assets			36 446
Disposals		$-94489$	$-20308$
Total at 31. December		53 158	99731
Available-for-sale financial assets include the following:
	Fair value hierarchy	2014	2013
Listed shares	Level 1	53 158	99 731
Total		53 158	99731

The entire change in available-for-sale financial assets during the quarter relates to financial instruments within the level 1 category of the fair value hierarchy. The fair value hierarchy is described below.

Fair value hierarchy

The group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

• quoted (unadjusted) prices in active markets for identical assets or liabilities. · Level 1:
• other techniques for which all inputs that have a significant effect on the recorded fair value are observable, · Level 2: either directly or indirectly.
• techniques that use inputs that have a significant effect on the recorded fair value that are not based on · Level 3: observable market data, for example discounted cash flow technique.

The financial assets are denominated in NOK and are measured at fair value. Listed shares are valued at values quoted in active markets as of 31.12.2014. Impairment of financial assets has been recognized trough the income statement.

NOTE 6-20 LARGEST INVESTORS

	NAME	02.01.2015
$\mathbf{1}$	SPETALEN	98,30%
$\overline{2}$	KRISTIAN HODNE AS	0,17%
$\overline{3}$	KOLBERG MOTORS AS	0,15 %
4	NORDSTJERNEN AS	0,14 %
5	KOLBERG	0,14%
6	SKIBSAKTIESELSKAPET ABACO	0,11%
$\overline{7}$	RAMS AS	0,09%
8	DNB NOR MARKETS, AKSJEHAND/ANALYSE	0,06%
9	NISTUÅ II AS	0,06%
10	GADD HOLDING	0,06 %
11	MYKLAND INVEST AS	0,06%
12	PAK INVEST AS	0,05 %
13	VOLDMO	0,04 %
14	INITIUM INVEST AS	0,04 %
15	JEBSEN	0,03%
16	MOMO INVEST AS	0,03%
17	BUSINESSPARTNER AS	0,02%
18	PEDRO EIENDOM	0,02%
19	JAGUAR FUND INVEST 2015 AS	0,02%
20	NORDNET PENSJONSFORSIKRING	0,02%
	TOTAL	99,61%

NOTE 7 - SUBSEQUENT EVENTS

On 26 February 2015 the board of directors approved a plan of merger with Strata Marine & Offshore AS. The terms and structure of this transaction is further described in the press release published on Oslo Axcess 26 February. The transaction is subject to approval from the General Assembly for the respective companies.

SAGA TANKERS ASA Sjølyst Plass 2 0278 Oslo

INVESTOR RELATIONS Phone: +47 23 01 49 14 e-mail: management@sagatankers.no

www.sagatankers.com