Saga Pure — Interim / Quarterly Report 2016

Aug 30, 2016

Q2 2016 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	Apr-Jun 2016	Apr-Jun 2015	Jan-Jun 2016	Jan-Jun 2015
	(unaudited)	(unaudited)	(unaudited)	(unaudited)
Operating revenues	110 901	71849	127 379	81510
Operating proft (-loss) before depreciation (EBITDA)	105 983	34 861	116943	15 204
Operating profit/(-loss) (EBIT)	105 253	34 201	115 483	12 5 6 5
Net profit/(-loss)	105 744	34 4 35	116 096	14 058
Total comprehensive income	$-9179$	84 218	$-128529$	267 197
Value adjusted equity per share (NOK)*	2,82	2,65	2,82	2,65
Basic and diluted earnings per share NOK	0,38	0,13	0,41	0,07
and the committee of the committee of the committee of the committee of the following the committee of the Little of

* Value adjusted equity has been calculated through application of market value for assets and liabilities traded in quoted markets, and book value for other assets and liabilities.

RESULTS

Saga Tankers Group ("The Group") reports a net total comprehensive income for the second quarter 2016 of NOK -9.2 million. (NOK -128.5 million for first half year of 2016)

EBITDA for the second quarter was NOK 106.0 million. (NOK 34.9 million for first half year of 2016)

Earnings per share (EPS) for the second quarter were NOK 0.38. (NOK 0.41 for first half year of 2016)

The Group had an income of NOK 5.2 million related to lease and operation of real estate and sundry income, and a net gain of NOK 105.7 million from investments for second quarter of 2016.

The average number of outstanding shares in the quarter was 279,732,611. As per the end of the period, the outstanding number of shares was 279,732,611. The Group holds an 7,000,000 additional shares in treasury.

The Group's condensed unaudited financial statements for the second quarter of 2016 are enclosed.

Current Investments

The Group currently holds investments classified as financial assets available for sale with a fair value of NOK 184.8 million. The fair value of the investments by the end of second quarter is as follows:

NEL ASA	NOK 54 million
Vistin Pharma ASA	NOK 43 million
Pareto Bank ASA	NOK 88 million

Net negative changes in market value of NOK 11.0 million for these investments were booked as other comprehensive income in second quarter 2016, while NOK 104.4 million positive changes former was reclassified to profit and loss due to realization of investments.

The Group has a cash holding of NOK 559.9 million at the end of second quarter.

Tax matters

As disclosed in the 2015 Annual report, the Group is currently undergoing a tax audit where the integrity of certain tax positions has been questioned for the fiscal years of 2012 and 2013. The Group made an agreement with the tax authorities in the end of June 2016, whereas deferred tax loss on assets and loss carried forward has been set to zero as end of 2014. The amendment does not result in any tax payable, nor does it give rise to any other effect for the financial statements.

Outlook

The Group has a solid investment portfolio and a strong balance sheet, enabling the company to continue to attractive investment pursue opportunities within the framework of industries it operates.

The Group expects the current market volatility to continue going forward, providing opportunities to create value through investments in assets, equity or debt.

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 when made, 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, 29 August 2016

The Board of Directors

RESPONSIBILITY STATEMENT

We confirm, to the best of our knowledge, that the financial statements for the period 1 January 2016 to 30 June 2016 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, 29 August 2016

The Board of Directors

Martin Nes Chairman

Øystein Stray Spetalen Board member

ra

Yvonne Litsheim Sandvold Board member

Kristin Hellebust Board member

CONSOLIDATED CONDENSED STATEMENT OF COMPREHENSIVE INCOME

NOK 1000		Apr-Jun 2016 Apr-Jun 2015 Jan-Jun 2016		Jan-Jun 2015
	(unaudited)	(unaudited)	(unaudited)	(unaudited)
Other Income	5 1 6 6	4 3 0 2	10851	10 138
Net gain/(-loss) from avaliable for sale assets	105 735		116 529
Other gains/(-losses)		67 547		67 547
Operating revenues	110 901	71849	127 379	77686
General administrative expenses	4 6 0 6	6578	9 4 0 9	13 4 6 7
Depreciation (note 5)	730	660	1460	1312
Net loss/(-gain) from avaliable for sale assets	$\overline{\phantom{a}}$	17988		15 308
Operating expenses	5 3 3 6	25 2 26	10869	30 088
Operating profit/(-loss)	105 565	46 623	116 510	47 598
Interest income	925	716	1500	2012
Interest expense	$-434$	$-417$	$-886$	$-1010$
Other financial items	$-3$	$-8066$	$-136$	$-4174$
Net financial items	488	$-7766$	477	$-3173$
Share of profit from associates (note 3)	$-309$	$-4357$	$-892$	$-4643$
Taxes	$\overline{\phantom{a}}$	65	$\overline{\phantom{0}}$	65
Net profit/(-loss)	105 744	34 4 35	116 096	39 717
Change in avaliable-for-sale assets	$-115375$	62 867	$-242765$	72 908
Exchange difference currency translations	452	$-13084$	$-1860$	$-13730$
Other comprehensive income	$-114924$	49783	$-244625$	59 178
Total comprehensive income	$-9179$	84 218	$-128529$	98 895
Attributable to:
Non-controlling interests	635	$-8058$	1481	$-6860$
Shareholders' interests	$-9814$	92 276	$-1300010$	105 755
Basic and diluted earnings per share NOK	0,38	0,130	0,41	0,14
			282 065 944
Average number of shares in the period	279 732 611 279 732 611	286 732 611 286 732 611	279 732 611	286 732 611 286 732 611
Number of shares outstanding at period end

CONSOLIDATED CONDENSED STATEMENT OF FINANCIAL POSITION

NOK 1000	30.06.2016	31.12.2015
	(unaudited)	(audited)
ASSETS
Non-current assets
Avaliable-for-sale financial assets (note 4)	184759	461 908
Fixed assets (note 5)	90 646	92 107
Associates (note 3)	35 391	38 143
Total non-current assets	310796	592 158
Current assets
Other current assets	946	1534
Cash and equivalents	559 897	426 606
Total current assets	560 843	428 140
TOTAL ASSETS	871 640	1020298
EQUITY AND LIABILITIES
Equity
Share capital	286733	286733
Own shares	$-7000$
Other equity	1 009 083	924 814
Total paid-in-capital	1 288 815	1 211 547
Accumulated losses	$-552271$	$-572317$
Other components of equity	50944	295 569
Non-controlling interests	27 592	26 112
Total equity	815081	960 911
LIABILITIES
Non-current liabilities
Long-term interest bearing debt	48 000	50 000
Deferred tax	88	88
Total non-current liabilities	48 088	50088
Current liabilities
Short-term interest bearing debt	4 0 0 0	4 0 0 0
Tax payable	5	49
Other current liabilities and accruals	4 4 6 5	5 2 5 0
Total current liabilities	8 4 7 1	9 2 9 9
Total liabilities		59 387
	56 559
TOTAL EQUITY AND LIABILITIES	871 640	1 0 2 0 2 9 8

CONSOLIDATED CONDENSED CASH FLOW STATEMENT

NOK 1000	Jan-Jun 2016	Jan-Jun 2015	Jan-Dec 2015
	(unaudited)	(unaudited)	(Audited)
Profit before tax	116 096	39782	14 26 1
Profitshare from associates	892	4643	5 6 4 4
Depreciation (note 5)	1460	1312	2639
Net loss/(-gain) from AVA asset	$-116529$	15 308	27 677
Other losses/(-gains)		$-67547$	$-61486$
Foreign exchange losses/(gains)	136	$-8066$	5474
Income tax paid	$-43$	$-40$	$-108$
Increase/decrease receivables and prepayments	588	10760	12820
Increase/decrease payables and accruals	$-785$	9694	485
Net cash flow from operating activities	1815	5845	7406
Investment in AVA Financial assets	$-107234$	$-29101$	$-80460$
Divestment in AVA Financial assets	257809		97 485
Net divestment/(-investment) trading	338	$-15308$	$-13762$
Net cash effect new subsidiaries		333 298	267741
Net cash effect disposal of subsidiaries			$-156947$
Investement in fixed assets		$-173$	$-173$
Net cash flow from investing activities	150 912	288716	113884
Repayments of long term borrowings	$-2000$	$-2000$	$-4000$
Dividends paid to non-controlling interests			$-23455$
Aquisition of own shares	$-17300$	$\overline{\phantom{m}}$
Share issuance costs		$-2$	$-2$
Net cash flow from financing activities	$-19300$	$-2002$	$-27457$
Net change in cash and cash equivalents	133 427	292 560	93832
Cash and equivalents at beginning of period	426 606	297 729	297729
Net cash in merger at carryover basis			35 106
Net foreign exchange differences (unrealised)	$-136$	$-4767$	$-62$
Cash and equivalents at end of period	559897	585 523	426 606

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Jan-Jun 2016 (Unaudited)
NOK 1000	Issued capital	Own shares	Other equity	Accumulated for sale losses	Available reserve	Exchange difference currency translations interests	Non- controlling	Total
Equity as at 1 january 2016	286733	٠	924 814	$-572318$	296 887	$-1317$	26 112	960 911
Net profit/(-loss)		$\overline{\phantom{a}}$		114 615			1481	116 096
Other comprehensive
income	$\overline{\phantom{a}}$	$\overline{\phantom{0}}$			$-242765$	$-1860$		$-244625$
Total comprehensive
income		$\overline{a}$		114 615	$-242765$	$-1860$	1481	$-128529$
Reclassification merged
equity*	$\overline{a}$		94 5 6 9	$-94569$			$\overline{\phantom{a}}$
Aquired own shares Equity per ending balance	$\overline{\phantom{0}}$	$-7000$	$-10300$					$-17300$
30 June 2016	286 733	$-7000$	1 009 083	$-552271$	54 1 22	$-3178$	27 592	815 081
Jan-Dec 2015 (Audited)
	Issued	Own	Other	Accumulated	Available for sale	Exchange difference	Non- controlling
								Total
NOK 1000	capital	shares	equity	losses	reserve	translations	interests
	175 834				$\overline{\phantom{0}}$	$-2648$	24 041	386 404
Equity as at 1 january 2015			883 696	$-694519$
	Ξ	$\overline{\phantom{0}}$	$\overline{\phantom{a}}$	19859			$-5801$	14 058
Net profit/(-loss) Other comprehensive
income	-	$\overline{\phantom{a}}$	-	-	251808	1331		253 139
Total comprehensive
income				19859	251808	1331	$-5801$	267 197
Merger 1 january 2015	110 899	$-$	41 1 18	94708	45 0 79			291803
Shareholders costs	$\overline{\phantom{0}}$	$\overline{\phantom{a}}$	$\qquad \qquad -$	10		$\overline{\phantom{0}}$		10
New minority interests						$\overline{\phantom{0}}$	177916	177916
Aquired from minorities		$\overline{\phantom{a}}$		7625			$-38075$	$-30450$
Dividends to minority
interests	$\overline{\phantom{0}}$	$\overline{\phantom{a}}$	$\overline{\phantom{a}}$	$\overline{\phantom{0}}$	$\overline{\phantom{a}}$	$\frac{1}{2}$	$-23455$	$-23455$
Exit minority interests Equity per ending balance	Ξ.	$\overline{\phantom{0}}$	$\overline{\phantom{a}}$	۳.			$-108513$	$-108513$

* Other equity arising from merger in 2015 has been reclassified to paid in equity.

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 second quarter is adopted by the Board of Directors on 29 August 2016.

The accounting policies adopted in the preparation of the condensed interim financial statements are consistent with those presented in the Annual Report of 2015. 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 subsidiaries in the Group as of 1 January 2013.

NOTE 2 - OPERATING SEGMENTS

The management monitors the net income from investments in financial assets and liabilities, and the revenues from lease and operation of property on a separate basis.

		Jan-Jun 2016 Jan-Jun 2015 Jan-Dec 2015
NOK 1000
Net income financial assets	116 529	$-15308$	$-27677$
Revenues from lease and operation of property	10 12 1	10 138	18 0 32
Other income	729		1993

NOTE 3 - ASSOCIATES

SD Standard Drilling Plc
38 143
$-892$
$-1860$
35 391

NOTE 4 - AVAILABLE-FOR-SALE FINANCIAL ASSETS

		30 Jun 2016	31 Dec 2015
NOK 1000
At 1 January		461908	53 158
Additions		107 234	80 460
Assets received through merger and demerger			219 607
Currency translations			9
Impairment			$-18488$
Increase/(Decrease) in value recognized as other comprehensive income		$-242765$	251808
Reclassified as subsidiaries			$-53158$
Reclassified from associates			21423
Disposals		$-141618$	$-92911$
Total		184759	461908
Avaliable-for-sale financial assets include the following:
	Fair value hierarchy	31 Mar 2016	31 Dec 2015
Listed shares	Level 1	184759	461908
Total		184759	461 908

The entire change in available-for-sale financial assets during the quarter relates to financial instruments that fall 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:

• $\bullet$ Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.
• 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 30 June 2016. No impairment of financial assets has been recognized through the income statement in 2016.

NOTE 5 - FIXED ASSETS

		Bulidings equipement	Capitalized Machinery & costs - work in progress	Land	Total
2016
NOK 1000
Aquisition cost, opening balance 01.01.16	91529	4319	38	199	96 084
Acquisitions during the period
Diposals during the period
Aquisition cost at 30.06.16	91529	4319	38	199	96 084
Accumulated depreciation, opening balance
01.01.16	$-3182$	$-796$			$-3978$
Depreciation	$-1274$	$-186$			$-1460$
Accumulated depreciation disposed assets	-
Accumulated depreciation at 30.06.16	$-4456$	$-982$			$-5438$
Net book value at 30.06.16	87072	3 3 3 7	38	199	90 646

			Capitalized Machinery & costs - work in
		Bulidings equipement	progress	Land	Total
2015
NOK 1000
Aquisition cost, opening balance 01.01.15	91529	4 1 4 6	38	199	95 911
Acquisitions during the period	٠	189			189
Diposals during the period		$-16$			$-16$
Aquisition cost at 31.12.15	91529	4 3 1 9	38	199	96 084
Accumulated depreciation, opening balance
01.01.15	$-923$	$-423$			$-1347$
Depreciation	$-2259$	$-380$		-	$-2639$
Accumulated depreciation disposed assets		8		-	8
Accumulated depreciation at 31.12.15	$-3182$	$-796$		-	$-3978$
Net book value at 31.12.15	88 347	3523	38	199	92 107

NOTE 6-20 LARGEST INVESTORS

Of total shares 60,28 % 14,47 %	outstanding shares 61,79 %
	14,83 %
4,52 %	4,63 %
2,20 %	2,25 %
2,17 %	2,23 %
1,45 %	1,48 %
1,40 %	1,43 %
1,36 %	1,39 %
0,89 %	0,91%
0,78 %	0,80 %
0,73 %	0,74%
0,62 %	0,63 %
0,59 %	0,61%
0,59 %	0,60 %
0,55 %	0,57 %
0,42%	0,43 %
0,39 %	0,40 %
0,35 %	0,36 %
0,35 %	0,36 %
95,54 %	95,43 %
	2,44 % N/A

*The Group holds 7,000,000 treasury shares, making it the fourth largest shareholders. These shares are excluded from number of outstanding shares.

** Controlled by board member Øystein Stray Spetalen, representing 78.85 % of outstanding shares.

SAGA TANKERS ASA Sjølyst Plass 2 0278 Oslo

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

www.sagatankers.com