Solstad Offshore ASA

solstad.no

OUR VISION is to conduct profitable, integrated shipping operations with high specification vessels using both our own vessels and chartered vessels. The company's core business is petroleumrelated operations.

CONTENT

Our business	4
Corporate structure	6
Financial highlights	7
Key figures	8

ANNUAL REPORT

The Board Corporate governance	16 17

9. Finance - parent company	14
8. Expectations for 2016	14
7. Health, the Environment, safety and Quality Assurance 13
6. Financial position and development - The Group	12
5. Corporate governance and management	12
4. Corporate particulars	11
3. Offshore market	11
2. The Company´s activities	10
1. Business, objectives and strategy	10

CONSOLIDATED

Statement of comprehensive income	20
Balance sheet	21
Statement of changes in equity	23
Statement of Cash Flow	24
Notes	26

CORPORATE ACCOUNTS

Profit and Loss account	57
Balance Sheet	58
Statement of Cash Flow	60
Notes	62
Auditor's Report	69
Fleet overview	71
Contract overview	72

FINANCIAL CALENDAR 2016

Preliminary dates for quarterly reports and ordinary
general meeting in SOFF is:
Annual report 2015	18-04-16
Results for 1st quarter 2016 / Ordinary General Meeting	09-05-16
Results for 2nd quarter 2016	22-08-16
Results for 3rd quarter 2016	07-11-16
Preliminary results 2016	ultimo February 2017

OUR BUSINESS

Solstad Rederi AS was established in 1964 by Captain Johannes Solstad. 31st August 2014 the company celebrated its 50 years anniversary. The Company's head office and home port are still located in Skudesneshavn, Norway.

During the Company's first ten years of operation it acquired and operated 14 dry cargo vessels (liner type) and also took delivery of three new build semi-container vessels. The size of these vessels varied from 8,000 DW to 14,000 DW.

The Company's offshore activities began in 1973, when it ordered four supply vessels from a Dutch shipyard and by 1976 the Company operated 9 supply vessels of various types. Most of them were jointly owned with other Haugesund-based shipping companies and all were built at the same Dutch shipyard, Pattje.

From 1974 to 1982, the Company owned and operated a combined fleet of both offshore and dry cargo vessels and had several new builds on order. Two AHT's and three AHT's were built in New Foundland and four semi-container vessels were built in Rostock in East Germany. However, the last dry cargo vessel was sold in 1982 and for the next eight years Solstad Rederi AS only operated offshore supply vessels.

In October 1997, the Company was listed on the Oslo Stock Exchange under the name of Solstad Offshore ASA. Solstad Shipping AS is wholly owned by Solstad Offshore ASA and is responsible for management and marketing.

At the end of the year the fleet consisted of 44 wholly owned and jointly owned vessels, including 1 vessel under construction in Norway. Including the large subsea construction vessel under construction for delivery during the summer 2016, , Solstad Offshore ASA own and operate 20 construction vessels 15 anchor handling vessels and 9 platform supply vessels.

Our vessels currently operate world-wide and approximately 67% of the revenue in 2015 came from operations outside the North Sea during.

Solstad Offshore ASA has around 1.600 employees. In addition to its head office in Skudesneshavn, Solstad has branch offices in Aberdeen, Singapore. Rio de Janeiro, Perth and Manila.

CORPORATE STRUCTURE

PER APRIL 2016

FINANCIAL HIGHLIGHTS

OPERATING INCOME LAST FIVE YEARS (NOK mill)

OPERATING INCOME 2015 QUARTERLY (NOK mill)

(NOK mill)	Ref	2015	2014	2013	2012	2011
PROFIT AND LOSS ACCOUNTS	9
Freight revenues		3 546	3 737	3 495	3 288	2 975
Other income		110	143	51	74	5
Operating result before depr./write-downs		1 429	1 650	1 497	1 438	1 070
Operating result		-335	1 252	1 123	873	163
Net finance		-1 244	-1 107	-582	-420	-562
Ordinary profit before tax		-1 579	145	541	366	-399
Net profit for the year		-1 604	113	485	400	-407
Hereof majority's share		-1 581	359	491	380	-362
BALANCE SHEETS 9
Deferred tax asset		38	62	59	115	43
Long term assets		14 212	15 249	12 137		12 665 14 044
Current assets		2 000	2 497	2 285	1 624	1 582
Total assets		16 236	17 746	15 025	14 727	15 673
Equity		3 668	5 058	4 954	4 625	4 416
Deferred tax		-	-	-	3	-
Long-term liabilities		9 274	10 427	7 700	7 165	9 509
Current liabilities		3 141	2 088	2 264	2 815	1 657

Long-term interest bearing liabilities		11 426	11 217	9 964	9 980	10 387
Bank overdraft		83	122	91	65	102
Free and restricted bank deposits Net interest-bearing liabilities		1 025 10 483	1 321 10 018	1 240 8 815	807 9 238	646 9 843

PROFITABILITY
Operating margin	1	39 %	43 %	42 %	43 %	36 %
Earning on equity	2,6	-36 %	3 %	11 %	8 %	-8 %
Earning on capital employeed	3	-2 %	8 %	8 %	6 %	1 %
LIQUIDITY
Liquid assets		1 025	1 321	1 240	807	646
Working capital		-1 140	409	2 285	1 624	804
EBITDA	4	1 555	1 717	1 589	1 428	1 100
Current ratio	5	0,6	1,2	1,0	0,6	1,0
ASSETS
Total assets		16 228	17 746	15 025	14 727	15 673
Equity		3 668	5 058	4 954	4 625	4 416
Equity ratio	6	23 %	28 %	33 %	31 %	28 %

KEY FIGURES PER SHARE

KEY FIGURES PER SHARE	REF	2015	2014	2013	2012	2011
Result of the year	7	-41,39	9,37	12,77	9,84	-9,63
EBITDA	4	40,69	44,79	41,33	36,94	29,27
Booked equity	8	95,99	132,40	128,88	119,56	115,09
Price/Earnings (P/E)		-1,91	8,43	9,40	10,16	-8,88
Price/EBITDA		1,94	1,76	2,90	2,71	2,92
Dividend		0,00	3,50	5,00	2,50	1,50
Share capital (NOK mill)		77,37	77,37	77,37	77,37	77,37
Quoted share price 31.12. (NOK)		21,00	79,00	120,00	100,00	85,50
Market capitalisation (NOK mill)		812	3 056	4 642	3 869	3 308

Average number of shares incl. adj. for stock of treasury shares.		38 200 012	38 323 643	38 445 455	38 662 733	37 587 310
N. of shares per 31.12 incl. Adj. For stock of treasury shares		38 206 866	38 197 727	38 440 155	38 682 077	38 370 349

REFERENCES:

1. Operating result before depreciation in percentages of total operating income.
1. Result before tax, in percentage of average equity including minority interests
1. Operating result plus interest income and result from associated company divided by average book shareholders' equity and interest-bearing debt.
1. Operating result before depreciation adjusted for gain/(loss) on sale of fixed asset and other material noncash effects.
1. Current assets divided by current liabilities
1. Booked equity including minority interests in percentage of total assets.
1. Result of the year for the Group divided by average number of shares.
1. Shareholders' equity divided by outstanding number of shares per 31.12.
Joint ventures are booked according to the equity method from 2012. Comparative figures for 2011 are changed accordingly.

ANNUAL REPORT

The market for offshore service vessels deteriorated sharply through 2015. To adapt the operations to the changed market the company has completed major work force reductions and lay-up of ships. The disappearance of freight revenues to come will not be compensated for by reductions in operating expenses alone. Most shipping companies in the industry have considerable bank and bond debt that will be difficult to operate fully under existing loan agreements. Based on the market outlook, the company is currently negotiating with its lenders about cuts and other adjustments to the market situation.

The Group reported earnings of MNOK 3,656 in 2015 compared to MNOK 3,880 the year before. The year's result after taxes was MNOK -1,604 compared to MNOK 113 in 2014. Cash flow (EBITDA) for the year was MNOK 1,555 compared to MNOK 1,717 in 2014.

With the substantial fall in oil price lately it is expected that the market will become more demanding the next coming year, and the outlook for 2016 seems to be more challenging than for 2015.

Our employees' strong focus on Health-, Safety- and Environmental measures gave historically positive results for 2015. This focus resulted in both lower loss of time injuries, incidents requiring medical treatment or limited ability to work.

The major transactions in 2015 related to refinancing of several vessels.

1. BUSINESS, OBJECTIVES AND STRATEGY

The company's mission is to operate an integrated shipping company with high specification vessels within their segments with both owned and chartered vessels. The company's core business is to provide services to petroleum-related offshore activities.

Our goal is to be a major player and provider of a wide range of services with our reputation in our vessels and high quality equipment and crew with strong maritime competency. In the North Sea, our target is to be one of the leading shipping companies. On an international level, we want to be one of the major players operating in deep waters and on subsea construction services.

In areas such as safety, the environment, solidity and profitability, the company focuses on achieving its ambitious targets. Our most important objective within our safety work is to prevent injury or damage to personnel and equipment whilst our most important environmental target is the continual reduction of environmentally damaging spills from our vessels.

The company's strategy is to offer customer-focused solutions and quality services and, at the same time, to develop the services we offer in close cooperation with existing and new customers.

The company is generally responsible for the overall operations of the vessels including chartering, manning and technical management. Where it is natural to achieve cost-effective operations and the optimal return on capital employed it is also possible to seek cooperation, and long-term strategic cooperation with other players. To mitigate risk and capital investment it is also important with such cooperation.

2. THE COMPANY'S ACTIVITIES

Solstad Offshore ASA's activities are primarily directed towards the offshore petroleum industry. The majority of our vessels are equipped to carry out projects over and above traditional supply and anchor-handling services. Our activities also include projects for development of offshore wind farms.

The fleet consists of 44 wholly and jointly owned vessels, including one new build. These vessels are managed from offices in Skudeneshavn (head office), Aberdeen, Rio de Janeiro, Singapore and Perth. Currently we have 3 vessels operating on the Brazilian Continental Shelf, 5 in Mexico and the US Gulf, 2 in Africa, 5 in Asia, 1 in the Mediterranean and the 16 in the North Sea. In addition 12 vessels are currently laid-up.

In 2015, the company's net freight income was divided as follows: 64% (53%) from CSV's, 26% (35%) from AHTS's and 10% (12%) from PSV's. Geographically, the freight income was divided by 33% (37%) from the North Sea, 21% (20%) from South America, 6% (4%) from West Africa, 16% (13%) from Central and North America, 5% (4%) from the Mediterranean and Europe and 19% (22%) from Asia.

Solstad Offshore ASA has one new build under construction, due to be delivered in July 2016. On handover, the vessel will go on an eight year charter (plus options) with Saipem.

For further details on the company's fleet refer to the Fleet Overview at the back of the Annual Report.

3. THE OFFSHORE MARKET

The persistently low oil price has changed the market outlook for the sector significantly. Both maintenance as investments in new projects offshore are put on hold or being postponed due to lack of profitability. This has a dramatic effect for the suppliers where capacity and cost level has been increasing through decades of strong growth of demand and high earnings. Generally, overcapacity led to rapidly declining day rates and weak utilization for offshore service vessels. Through 2015 shipowners have had to curtail activity and cost through lay-up of many vessels and dismissals of a large number of employees. In the North Sea area a total of more than 100 vessels were laid-up at the end on the year.

Our main types of offshore service vessel are AHTS's, PSV's and CSV's. The first two types are grouped in accordance with the vessels engine and loading capacity, as well as their technical specification. The CSV segment, that is, those vessels performing subsea activities, is more diverse, dependent on what the vessel can be used for. Various activities ranging from simple inspection work to more complex installation work requires a rage of vessel sizes and equipment.

The amount invested in the more advanced vessels is typically substantially higher than for the lesser advanced operations in this segment.

The world fleet of AHTS's over 15,000 bhp at year end was around 245 vessels whilst there were 975 PSV's with a capacity of more than 3,000 dwt. There were around 70 and 250 respectively of these vessels operating in the North Sea. At the same time, 20 AHTS's over 15,000 bhp and 240 PSV's over 3,000 dwt were under construction.

There are about 75 larger construction service vessels under construction at shipyards in Europe, USA and Asia. Total fleet of CSV's at the end of 2015 was approximately 250 vessels.

There is uncertainty to whether all vessels under construction will be build and delivered.

4. CORPORATE PARTICULARS

It is our goal to make the company attractive in the long-term by increasing the value of the company in terms of share value and dividends. The Board aims to ensure that, on average, the dividend represents from 20 to 40% of profit after tax, adjusted for any major currency effects and minority interests. The annual proposed dividend should always be considered in the light of the expectation of future earnings, cash flow, financing and other factors affecting the company's position.

The total number of issued shares at the end of the year was 38,687,377. The number of shareholders at 15 April 2016 was 3.092, 10% of which are foreign investors.

The Board will propose to the Annual General Meeting on 9 May 2016, that no dividend is paid for 2015.

The company's share price has developed negatively throughout the year. This is primarily a result of the persistently low oil price throughout 2015 and, consequently, expectations for a reduction of the demand for the company's services due to reduced activity offshore. At the beginning of the year the price was NOK 79,- and at the end of the year was NOK 21,- that is, a reduction of 73%. The company paid NOK 3,50 in dividends in 2015 (for the 2014 fiscal year).

Until the next Annual General Meeting, the Board has power of attorney to purchase 10% of treasury shares. The Board requested this power of attorney in order to carry out continuous evaluation of this as a shortterm investment alternative as well as for strategic investment. At 31.12.15, 424,975 treasury shares were held compared to 489,650 the previous year.

At the Annual General Meeting in May 2015, the Board renewed their power of attorney to increase share capital by up to NOK 4 million. This power of attorney, which is in place until the first ordinary general meeting has not been exercised to today's date. At the next general meeting on 9 May 2016, the Board will propose that this power of attorney be renewed relating to increased share capital and purchase of treasury shares.

Solstad Offshore ASA has been listed on the Oslo Stock Exchange since 1997. As the holding company for the Group, its primary activity is ownership of shares in subsidiaries together with other company investments, of which most important is Solstad Rederi AS (100%), Solstad Offshore (UK) Ltd (100%) in Aberdeen, Solstad Offshore Asia Pacific Ltd (100%) with subsidiaries in Singapore and Perth and Solstad Offshore Ltda (100%) in Brazil.

5. CORPORATE GOVERNANCE AND MANAGEMENT

Solstad Offshore ASA's governance and management are based on the company's vision and strategy. The company is listed on the Oslo Stock Exchange and is subject to the Norwegian companies, accounting, stock exchange listing and securities trading legislation. Solstad Offshore ASA adheres to the Norwegian Code of Practice for Corporate Governance dated October 30, 2014. More information on corporate governance is given in a separate chapter in the annual report and on the Company's web site.

6. FINANCIAL POSITION AND DEVELOPMENT – THE GROUP

The Annual report for 2015 has been prepared in accordance with IFRS (International Financial Reporting Standards which are approved by the European Union, giving comparative figures for 2014.

Operating income in 2015 was NOK 3,656 million compared to NOK 3,880 million the previous year. The reduction is mainly related to lower demand for services in the platform supply- and anchor handling segments, as a result of the oil companies' reduced activities due to the low oil prices. The revenue from the construction service segment increased in 2015 due to higher capacity, combined with a significant strengthening of USD against NOK. Cash flow from operations for the year (defined as earnings before impairment or depreciation, adjusted for profit on disposal and cash flow from associated or joint ventures) was NOK 1,555 million (NOK 1,717 million).

The operating result after impairment and depreciation was a loss of NOK 355 million compared to a surplus of NOK 1,251 million in 2014. The change is mainly related to an impairment of the Group's fleet by NOK 1,346 million during the year.

The Group result for 2015 after tax was a loss of NOK 1,604 million (surplus NOK 113 million in 2014). This year's result included a net financial loss of NOK 1,244 million (NOK 1,106 million in 2014). The year's financial loss is primarily related to net interest expenses of NOK 480 million (NOK 454 million in 2014), net NOK 765 million in net realized/unrealized currency gain on receivables and debt, in additional to financial hedging agreements measured at year end (NOK 665 million in 2014). Earnings per share was NOK -41.39 (NOK 3.94 in 2014).

Operating profit (excluding gain on disposals) before impairment and depreciation, including share from Joint ventures, (operating margin) amounted to 40% of operating income compared to 43% in 2014.

The market value of the Group's fleet at 31.12.2015 (excluding 50% share of Joint Ventures (JV)) was NOK 17.5 billion (NOK 18.6 billion at 31.12.2014). This valuation is the average of valuations by three brokers based on charter-free vessels (excluding new builds). Value adjusted equity before tax, adjusted for minority interests and including 50% shares in JV's was NOK 205 per share at the end of 2015, compared to NOK 242 at the same time last year. The value of the vessels has decreased significantly throughout the year, especially for the platform supply- and anchor handling vessels. Posted equity at 31.12.2014 amounted to NOK 3,668 million or NOK 96 per share.

A significant degree of estimates is included in value of vessels and also lifetime of the Group's vessels and both estimates are bound with uncertainty. Per 31.12.2015 there are several indications that the fleet has decreased in value. Impairment test in accordance with IAS 36 was performed. The performed analysis found four vessels in need of write down by a total of NOK 36 million in the second quarter, while an additional 22 vessels was written down by a total of NOK 1,221 million in the fourth quarter. Hence, the Group's fleet has been written down by a total of NOK 1,346 million during 2015. It is mainly the platform supply- and anchor handling fleet that has been written down.

Long-term interest bearing debt at 31.12.2015 was NOK 11,793 million (NOK 11,549 million). NOK 2,520 million (NOK 1,122 million) of which is classified as short-term debt. The debt is divided as 43% NOK, 48% USD and 9% GBP. At the end of the year, 1-4 year hedging agreements were entered for around 38% of the total long-term debt. Furthermore, some of the NOK debt is linked, through financial instruments, to USD so that the real debt exposure is 41% NOK, 50% USD and 9% GBP.

Long-term debt maturing in 2015 has been refinanced as planned. In monetary terms the refinancing amounted to in excess of NOK 3,500 million, and was the largest single transactions in 2015. In the beginning of 2016 negotiations with the Group's lenders have started in order to review to structure of the current financing of the fleet.

The Group's net interest-bearing debt at the end of 2015 was NOK 10,851 million (NOK 10,350 million).

The Group is exposed to operational and financial market risk by the nature of its business. The market risk is changes in freight prices, exchange rates and interest rates and which impact the value of the Group's assets, liabilities and future cash flow. To reduce and control

these risks management regularly review and reassess the Group's main financial market risks. When a major risk factor is identified, actions to reduce the specific risk are evaluated. The Group is exposed to both interest and currency risk, mainly through its long-term financing and long-term charter contracts. The interest risk is partially mitigated by hedging agreements. The currency risk is eliminated by having loans and liabilities in the same currency as the charter agreements.

In 2015, the Group, like industry in general, has been through several rounds of work force reductions, both among maritime personnel and onshore employees. The workforce has been reduced by 340 employees, whereof 300 were employed on the Group's vessels. The work force reduction is carried out through natural attrition, offers of early retirement and layoffs. Depending on future developments the possibility of further downsizing.

Definitions of the various financial used are found under the heading "Financial Key Figures" and "Key Rations per Share" together with a summary of the key figures from the consolidated accounts.

7. HEALTH, THE ENVIRONMENT, SAFET Y AND QUALIT Y ASSURANCE

The company operates in compliance with a number of international regulations and standards and is certified to ISM, ISO 14001:2004, ISO 9001:2008, MLC (Maritime Labour Convention) and ISPS (International Ship and Port Facility Security) requirements. Crew are given training on board in compliance with the requirements of STCW '10 (Seafarers Training, Certification and Watch-keeping Code). Internal audits are performed annually on all vessels and offices.

The company is committed to accident avoidance and the prevention of injury. In 2015, approximately 23,000 HSE reports were processed by our HSE and QA Systems. These reports are registered, processed and analysed in a database report system and form the basis for preventive action to avert future accidents and injuries.

Solstad Integrated Management System (SIMS) is a process-based quality assurance system that includes overall aims and descriptions of all processes and activities involving personnel both onshore and offshore.

The company had a total of 2 work related lost time incidents (LTI's) which resulted in an H factor (number of lost time incidents per 1,000,000 working hours) of 0.23 for 2015 (0.55 in 2014). None of the incidents caused serious injury. The company's zero injuries philosophy will continue into 2016 and the company focuses on evaluation, facilitation, planning and prevention to avoid all types of personnel-related incidents and to prevent incidents with a negative effect on the environment. The fleet (including third party Subsea equipment) reported spills of 95 litres to sea in 2015. The company has a program for recycling and reporting of waste generated by the vessels and onshore organizations.

Solstad Green Operations is the company's environmental program where the intention is to preserve the environment, first and foremost, through reduced use of fuel. From the start in 2009 the fuel consumption is reduced by 20%. In 2015 Solstad Offshore personnel performed 21,433 green operations (SGO). Amongst others, this resulted in a 38,113 tons fuel usage reduction, which alone gave an estimated 121,000 tons CO2 reduction for the year.

Solstad Green Operations has a co-operation with the "Rainforest foundation" in Norway. Each performed SGO results in a contribution to the foundation, which aim is to preserve the rainforest.

Solstad Offshore ASA is in compliance with the Accounting Act's new regulations for reporting of Corporate Social Responsibility. The report for 2014 is available on the company's web site – www.solstad.com.

The working environment onshore and on board is considered to be good and there are continuous measures to prevent any form of discrimination due to age, gender, religion, colour or other factor. Sick leave amongst the marine crew on Norwegian payroll was 3.2% in 2015, an improvement from the year before (3.6%).

The company's administrative personnel are divided into approximately 58% male and 42% female. At the end of the year there were 69 females at sea. Personnel recruitment focuses strongly on equality. However, female marine personnel are scarce, not only in Norway but internationally. The company is committed to the recruitment and training of cadets and apprentices and focuses on encouraging Norwegian youth to consider a maritime education. Despite this, there has been little success with schools and trade organizations to persuade a greater number of women to opt for a maritime education or occupation. The exception is Brazil in which the share of females in officer positions are higher than any place else.

For recruitment at sea as well as onshore, the company is committed to equality on the basis of sex, nationality disability, religion or other factors that should not affect the hiring process.

8. EXPECTATIONS FOR 2016

As a result of the large imbalance between supply and demand of offshore service vessels, the company expects that the market will be challenging in the coming years. The disappearance of freight revenues to come will not be compensated for by reductions in operating expenses, primarily through circulation of ships, alone. Most shipping companies in the industry have considerable bank and bond debt that will be difficult to operate fully in accordance with signed loan agreements. Based on the market outlook, the company is currently negotiating with its lenders about cuts and other adjustments to the market situation. The challenging times the offshore sector is now facing will probably also entail increasing need for consolidation of the fragmented offshore service vessel segment. Solstad Offshore ASA wants to contribute to such consolidation.

The demand for oil is expected to be high long term. The access to more oil sources on land increases the competition in the market and puts preasure on prices. An adjustment of the general cost level will be necessary to make offshore investments attractive in relation to other alternatives.

Solstad Offshore ASA has a diversified fleet equipped for a variety of services relating to offshore petroleum activities including exploitation, exploration and installation work. The need for modern tonnage that is equipped for specialized operations in various waters is expected in the long term to increase again. For 2016, the company has fixed contracts for about NOK 2.8 billion. As a result of the market situation prevails generally greater uncertainty about the payment capabilities of its customers than before.

9. FINANCE – PARENT COMPANY

The result for Solstad Offshore ASA in 2015 was a profit of NOK 160 million (NOK 234 million in 2014). The net financial profit of NOK 185 million (NOK 256 million in 2014) relates to income from dividends from subsidiaries of NOK 200 million, net external interest costs of NOK 95 million and net interest income from Group companies of NOK 26 million. Net financial items also include guarantee commission (NOK 42 million), net currency gain (NOK 73 million) and NOK 15 million in group contribution. Further, a NOK 89 million (NOK 63 million in 2014) write down of shares in subsidiaries is booked. The operating result for the year was a loss of NOK 18.2 million (loss of NOK 19.8 million in 2014). The company's assets are largely the value of shares in subsidiaries and associated companies and loans to group companies. Booked equity at year end was NOK 3,317 million. Debt at the same time was NOK 1,940 million, of which NOK 1,700 million is in bond loans, NOK 82 million in short-term credit and a NOK 128 million long term loan from subsidiaries.

The annual accounts are prepared on the assumption of a going concern, in accordance with § 3-3 of the Accounting Act. On the basis of, amongst others, the liquidity budget for 2016 and its forecasts for operations, The Directors affirm that this assumption is correct.

The Board proposed that the following distribution is made:

Allocated to dividend	NOK 0
Transfer from retained profits	NOK 159,914,730
Net applied/transferred	NOK 159,914,730

Board of Solstad Offshore ASA Skudesnehavn 18.04.2016

AFFIRMATION BY THE BOARD AND MANAGING DIRECTOR

We hereby affirm that, to the best of understanding, the Annual Accounts for the period 1st January to 31st December 2015 have been prepared in accordance with current accounting standards; and that the information in the accounts represents a true and fair view of the company's and the consolidated group's assets, liabilities, financial position and overall performance. We further affirm that the Annual Report provides a true and fair view of the development, earnings and standing of the company and the consolidated group; outlining the most important risk factors and uncertainties facing the group.

Ketil Lenning Director

Anders Onarheim Director

Board of Solstad Offshore ASA Skudesnehavn 18.04.2016

Terje Vareberg Chairman Anette Solstad

Director

Toril Eidesvik Director

Lars Peder Solstad Managing Director

THE BOARD

TERJE VAREBERG (born 1948)

Terje Vareberg has an MBA from Norwegian School of Business Administration1974. He has worked as Cheif Executive Officer in Sparebank 1 SR-Bank and as Executive Vice President / Deputy CEO in Statoil. Terje Vareberg has national and international experience from various positions / directorships. Terje Vareberg was elected as board member in 2011, and chairman since 2014. He has an interest in Solstad Offshore ASA as chairman in Solstad Trading AS.

SHARES IN SOLSTAD OFFSHORE ASA: 3.000

KETIL LENNING (born 1950)

Ketil Lenning currently works for a consultancy firm as an independent consultant. Until the autumn of 2010, he worked as CEO for Oddfjell Drilling Ltd. and has extensive national and international experience from various companies and positions within the oil industry. He has a degree in Petroleum Engineering from NTNU, Texas A&M University, US. Ketil Lenning holds several other directorships. He has been director since 2010, and is up for election in 2016. Ketil Lenning is independent of the company's main shareholders.

SHARES IN SOLSTAD OFFSHORE ASA: 0

ANETTE SOLSTAD (born 1965)

Anette Solstad has been living in the US since 1989. She has a B.A. in International Business and has previously worked for Wilhemsen Lines, US within operations and commercial analysis and as a system developer for Prudential Securities. She does not hold any other directorships. Anette Solstad has been a director since 2007. She holds an interest in Solstad Offshore ASA's shareholders SOFF Holding AS, Solstad Invest AS and Solhav Invest X AS.

SHARES IN SOLSTAD OFFSHORE ASA: 56.402

ANDERS ONARHEIM (born 1959)

Anders Onarheim is currently working as Managing Director of Spitsebergen AS. He holds an MBA from Washington University in St. Louis, and started his career with the financial institution Edward D. Jones. He has later worked in well renovned investment banks like Merril Lynch and Goldman Sachs internationally and also worked as managing director of Carnegie AS for 15 years. Anders Onarheim today holds positions in several boards and has been a member of the board of Solstad Offshore since May 2014, and is up for election in 2016. Onarheim is independent of the company's main shareholders.

SHARES IN SOLSTAD OFFSHORE ASA: 20.0000

TORIL EIDESVIK (born 1968)

Toril Eidesvik is a trained solicitor from UiO (1993) and has worked as solicitor with Simonsen Musæus Advokatfirma (from 1994 – 1998) and Gjensidige NOR Sparebank (1998 – 2002). In the period from 2003 to 2008 she worked as solicitor in Caiano AS. From 2009 until 2012 she was Managing Director of Green Reefers ASA and from 2013 to 2014 she was CEO in the ship supply company EMS Seven Seas ASA. Today Eidesvik work as a lawyer and independent consultant. She has long experience as a board member, and is today a board member in, among other companies, TTAS Group ASA. Toril Eidesvik has been a board member since 2005. She is independent of the company's main shareholders.

SHARES IN SOLSTAD OFFSHORE ASA: 2.500

CORPORATE GOVERNANCE

Corporate governance in Solstad Offshore ASA is based on the company's vision and strategy. The company is listed on the Oslo Stock Exchange and subject to Norwegian companies, accounting, exchange listing and securities trading legislation. Solstad Offshore ASA adheres to the Norwegian Code of Practice for Corporate Governance of 30th October 2014.

Implementation and reporting

The company believes that it is important to clarify the division or roles between shareholders, the board of directors, and executive management, and has therefore chosen to report on the company's corporate governance as recommended in the Code of Practice. Solstad Offshore ASA maintains guidelines for ethical conduct and social responsibility aimed at securing values and corporate culture in the organization to provide a basis for value creation, safe and green operation, workplace satisfaction, positive reputation and innovation.

Business

The objects of the company are set out in the articles of association as "to operate shipping operations and everything connected therewith…» Within these objects the company's business concept is to run an integrated shipping business with highly specified vessels in chosen segments on our own or chartered vessels. The core operations are primarily the provision of services to oil-related offshore activities. The company articles are available in full online at www.solstad.no. More details of the goals and strategy of the company are set out in Section 1 of the Annual Report.

Equity and dividends

The company's posted equity amounted to 23% of total assets at year's end 2015, which is a reduction from 28% for 2014. The company's financial standing is satisfactory. The company is committed to securing for shareholders a high and stable return. This return is taken to mean the sum of share price increase and paid dividend.

The company aims each year to pay dividend to shareholders. The amount will in average correspond to 20% - 40% of company profits after tax, adjusted as necessary for major currency variances and non-controlling interests. Dividend will nonetheless always take account of forecast future earnings and cash flows, as well as demand for financing and other matters affecting company standing. In 2015, Solstad Offshore ASA paid a dividend of NOK 3,50 per share for the fiscal year 2014. The Board will propose no dividends to be paid for the fiscal year 2015.

The General Meeting held on 18th May 2015 authorized the directors to make the following payments:

Expand share capital in Solstad Offshore ASA by maximum NOK 4.000.000 by the issuance of maximum 2.000.000 new shares, each of face value NOK 2,-. The authorization, which remain in force until the General Meeting in 2016, also covers a decision to merge under the Public Companies Act, section 13-5.
Acquire treasury shares to a total value of maximum NOK 7.737.475, which is to say maximum 10% of shareholder capital. The directors are free to determine the means of acquisition and sale of treasury shares. The company will pay a minimum NOK 1,- and maximum NOK 250,- per share acquired under this authorization. The authorization remains in force until the General Meeting in 2016.
Resolve to expand the shareholder capital by maximum NOK 280.000, by the new subscription of maximum 140.000 shares each of face value NOK 2,-. Within these limits the directors will determine whether to offer one or several issues and their size. The capital expansion will be reserved for company personnel, and shareholders waive all preemptive rights to these shares. The directors will determine the subscription price and other condition of sale. The authorization remains in force until the General Meeting in 2016.

Equal treatment of shareholders and transactions with close associates

Solstad Offshore ASA has a single class of shares. The articles do not distinguish differences in voting rights, and all shares carry equal rights.

The rights of the directors to acquire treasury shares are contingent upon such acquisition taking place in the marketplace.

During 2015 there were no transactions between the company and the shareholders, the board of directors and the executive management and their close associates, expect as reported in the financial statements, see Note 15.

The company maintains rules to ensure that the board of directors and executive management report to the board in case of any direct or indirect material interest in any contract signed by the company.

Freely negotiable shares

The shares in Solstad Offshore ASA are freely negotiable. The articles set no limits on sale / negotiability.

General meeting and nomination committee

The annual general meeting is normally held in the month of May. According to the articles of association, documents up for consideration at the general meeting are posted on the company webpage. Efforts are made to ensure they contain all necessary information to enable shareholders to take a stand on all matters to be dealt with. The board chairman takes part in the general meeting, as does the company auditor. The meeting invitation and briefing documents for the general meeting are also published on the webpage (www.solstad.no) no later than three weeks before the meeting. The board is keen to enable as many shareholder as possible to take part. The deadline for attendance is put as close as possible to the meeting date. Shareholders who cannot attend, are

urged to attend by proxy. The invitation sets out the information about procedures that shareholders must follow in order to take part and cast votes at the general meeting. They also describe how to appoint a proxy. Two people should be named who can vote on behalf of the shareholder by proxy. The proxy authorization form is designed as far as possible to allow shareholders to vote on individual issues and individual candidates for election / re-election. The Agenda is determined by the board of directors, according to the article 6 of the Articles of Association. The chairman opens the general meeting and a meeting chair is elected. The minutes of the general meeting are published as a stock exchange notice, as well as on the company website. The Articles of Association states that the company shall have a nomination committee of 2-3 members as further decided by the general meeting. The nomination committee shall propose candidates for the board of directors and for the nomination committee itself, and propose remuneration for the board and the committee members. The general meeting will elect the members of the nomination committee, including the chairperson, and lays down their remuneration. The guidelines for the nomination committee and their contact details are published on the company webpage (www.solstad.no).

Board composition and independence

The nomination committee's primary goal is to propose candidates who will ensure that the company has a board of directors with the maximum relevant expertise, capacity and diversity. The board should also be composed so that directors can act independently of special interests and have a minimum of two shareholder elected directors who are independent of the major shareholder. In connection with new directorship candidates the focus is on gender equality, in addition to looking for appropriate expertise and capacity. Directors are elected for a two-year term of office. Representatives from the executive personnel in the administration are not members of the board.

Board work

The directors draw up an annual plan for the board's work. Normally there will be six to eight regular board meetings, augmented by telephone conferences as needed. Instructions for the board and executive personnel have been drawn up. Company internal control is exercised according to the adopted guidelines and reviewed with the auditor and board each year. The board receives monthly financial report where economic standing and financial status are reviewed. The elected vice-chairman chairs the work of the board in the absence of the chairman. An audit committee consists of two members who are independent of the business and elected by and from the directors. Each year the board conducts a selfassessment of its work and qualifications if necessary.

Risk management and internal control

The board seeks through its work to ensure that the company maintains good standards of internal control and appropriate systems of risk management, in light of the scope and nature of the company's business, and the provisions that govern the business. The company has established a system of operation and administration that relies on work procedures and job descriptions. The system also covers social responsibility and ethical guidelines. There is a commitment to quality assurance. The board receives information about operational, administrative and financial developments in monthly reports. Each year the board reviews corporate strategy and the business plan, including also an analysis of the company's risk exposure. Exposure is monitored monthly through the reports from the administration.

Remuneration of directors

The remuneration paid to the board of directors reflects the board's responsibilities, expertise, time commitments and complexity of the business, and is not linked to performance. The amounts involved are reported in the financial statements. The directors do not have stock options. In cases where members of the board undertakes significant work for the company, all the directors are informed and the fees are approved by the board. These fees are reported in the financial statements. All transactions between directors or personnel (or companies that they represent or are associated with) on the one hand, and the company on the other, are implemented in accordance with the arm's length doctrine.

Apart from the details included in the Notes regarding remuneration and contracts with directors (or companies that they represent or are associated with) the company has no other obligations. Remuneration to directors is considered to reflect market conditions.

Remuneration to executive personnel

The remuneration to the managing director is determined by the board meeting. Other elements of the remuneration are reported in the Notes to the financial statements. The guidelines for remuneration of executive personnel are presented to the general meeting for information purposes.

Apart from the details included in the Notes regarding remuneration and contracts with the managing director and deputy managing director (or companies that they represent or are associated with) the company has no other obligation. Remuneration to the managing director is considered to reflect market conditions. There are no stock option programs for personnel.

Information and communications

To be confident of equal treatment of shareholders the company is committed at all times to ensure that the stock market has correct, clear and timely details about the company's business and standing. Presentation of the quarterly and annual accounts is made according to a schedule displayed in the financial calendar on the company webpage at www.solstad.no and filed as a Notice with the Oslo Stock Exchange. Beyond that, frequent briefings and discussions are held with analysts and investors. Information is disclosed through stock exchange notices, discussions with analysts, and general briefings for investors, as well as special briefings for stock brokers and investors. The company adheres to the recommendations of the OSE regarding Investor Relations reporting.

Take-overs

Solstad Offshore ASA has no defense mechanisms to prevent stock buyups in the Articles, nor have we implemented other measures to limit acquisition of shares in the company. If an offer is presented for company shares the board will work to inform shareholders and allow time to decide on the offer, and issue a statement that assesses the offer, and a recommendation to shareholders whether to accept it or not.

Auditor

Each year the auditor sets out the highlights of the audit plan to the audit committee. The auditor will also go through a report about his views and observations regarding accounting principles, risk areas, internal control routines, and other aspects. The auditor will also deliver a written report each year to affirm his compliance with certain impartiality and objectivity standards. The auditor attends board meetings to discuss the financial statements for the year, and the annual general meeting.

Important consultancy work performed by the auditor requires prior approval by the directors. The remuneration to the auditor is reported in the financial statements. The board of directors meet once a year without the managing director or other representatives from the administration present.

STATEMENT OF COMPREHENSIVE INCOME 1.1 - 31.12

GROUP		(NOK 1 000)
	Noter	2015	2014

Freight income	4	3 546 418	3 737 349
Other operating income	4,5	109 542	142 824
Total operating income		3 655 959	3 880 173

Personnel costs	5,6	-1 395 564	-1 394 114
Ordinary depreciation and write down	8	-299 908	-275 032
Write-down fixed assets	8	-1 346 481
Depreciation on capitalised periodic maintenance	8	-183 157	-186 795
Other operating expenses	5	-899 675	-852 492
Insurance claims	10	67 811	16 032
Income from investment in joint ventures	9	65 878	63 779
Total operating costs		-3 991 094	-2 628 622

Operating profit/loss		-335 135	1 251 552

Income from investment in associated companies	9	-1 021	876
Interest income		9 909	20 860
Other financial income		753 078	660 053
Interest charges		-480 426	-454 241
Other finance costs		-1 525 590	-1 334 390
Net financing	7	-1 244 050	-1 106 842

Ordinary profit before taxes		-1 579 186	144 709
Tax on ordinary result	12	-24 996	-31 355
Net profit for year		-1 604 181	113 354

Comprehensive income
Translation adjustments foreign currency		302 669	227 735
Net gain on available for sale financial assets		-153	-93
Comprehensive income that may be reclassified in subsequent periods		302 516	227 643

Actuarial gain/ (loss)	6	46 949	-20 085
Comprehensive income that may not be reclassified in subsequent periods		46 949	-20 085

Comprehensive income		-1 254 716	320 912

Net profit attributable to:
Minority shares		-23 074	-38 298
Majority shares		-1 581 108	151 652

Comprehensive income attributable to:
Minority shares		-23 074	-38 298
Majority shares		-1 231 642	359 210

Earnings and diluted earnings per share (NOK)	14	-41,39	3,94

BALANCE SHEETS

	NOTER	31.12.15	31.12.14
ASSETS

Long-term assets

Intangible fixed assets
Deferred tax asset	12	37 987	61 966
Total intangible fixed assets		37 987	61 966

Long-term fixed assets
Vessels and new build contracts	2,8	13 466 610	14 460 434
Capitalized periodic maintenance	8	270 661	290 253
Other tangible fixed assets	8	28 242	22 717
Total long-term fixed assets		13 765 513	14 773 404

Financial assets
Investment in joint ventures	9	344 032	302 368
Loans to associated companies and joint ventures	15	14 852	30 210
Investments in associated companies	9	42 302	43 323
Investments in stocks and shares	9	2 991	2 991
Other financial assets	3	2 250	4 031
Other long-term receivables	19	1 945	30 935
Total financial assets		408 373	413 858

Total long-term assets		14 211 873	15 249 228

Current assets

Stock	21	57 026	61 188

Receivables
Account receivables	20	635 073	756 794
Other short-term receivables	20	282 804	357 660
Total receivables		917 877	1 114 454

Investments
Market based shares	9	229	382
Bank deposits and cash equivalents	16	1 025 066	1 320 736
Total current assets		2 000 199	2 496 760

Asset held for sale	8	24 112
TOTAL ASSETS		16 236 183	17 745 988

BALANCE SHEETS

	Noter	31.12.15	31.12.14
EQUITY AND LIABILITIES
Equity
Restricted equity
Share capital (38.687.377 a 2,-)	13	77 375	77 375
Treasury shares	13	-850	-979
Other paid-in capital		111 648	111 648
Share premium		1 654 186	1 654 186
Total restricted equity		1 842 359	1 842 230

Earned equity
Other equity		1 940 140	3 304 315
Total earned equity		1 940 140	3 304 315

Minority interests		-114 924	-89 013

Total equity		3 667 575	5 057 532

Liabilities
Provisions
Deferred income		9 136	9 339
Pension obligations	6	50 672	98 781
Other financial liabilities	3	94 603	65 888
Total provisions		154 411	174 008

Other long-term liabilities
Other long-term loans	11	367 703	331 886
Debt to credit institutions	11	8 905 838	10 094 844
Total long-term liabilities		9 273 541	10 426 730

Current liabilities
Accounts payable		126 178	371 529
Bank overdraft	3	82 656	121 908
Taxes payable	12	58 273	40 697
Accrued salaries and related taxes		40 821	51 502
Other current financial liabilities	3	33 648	25 961
Other current liabilities	22	279 079	353 750
Current interest bearing liabilities	10,11	2 520 002	1 122 371
Total current liabilities		3 140 656	2 087 718

Total liabilities		12 568 608	12 688 456

TOTAL EQUITY AND LIABILITIES		16 236 183	17 745 988

Mortgages	11
Guarantees etc.	3,7,11

Skudeneshavn, April 18th, 2016 Terje Vareberg Chairman Ketil Lenning Director

Anette Solstad Director

Toril Eidesvik Director

Lars Peder Solstad Managing Director

Anders Onarheim Director

STATEMENT OF CHANGES IN EQUITY

GROUP (NOK 1.000)

	Note	Share capital	Treasury shares	Share premium	Other paid-in capital	Translation adjustments	Value changes	Other equity	Total majority shares	Minority shares	Total equity
Equity 01.01.2014		77 375	-484	1 654 186	111 648	-17 655	46	3 178 455	5 003 572	-49 296	4 954 275
Annual result								151 652	151 652	-38 298	113 354
Actuarial gain/ loss (-)								-20 085	-20 085		-20 085
Translation adjustments						227 735			227 735		227 735
Value changes in assets
available for sale	9						-93		-93		-93
Comprehensive income						227 735	-93	131 567	359 210	-38 298	320 912
Purchase/ sale treasury shares	13		-495					-24 229	-24 725		-24 725
Paid dividend/ surplus								-193 437	-193 437	-1 419	-194 856
Unalloc. dividend on treas. shares								1 926	1 926		1 926
Equity 31.12.2014		77 375	-979	1 654 186	111 648	210 081	-47	3 094 281	5 146 545	-89 013	5 057 532
Equity 01.01.2015		77 375	-979	1 654 186	111 648	210 081	-47	3 094 281	5 146 545	-89 013	5 057 532
Annual result								-1 581 108	-1 581 108		-23 074 -1 604 181
Actuarial gain/ loss (-)								46 949	46 949		46 949
Translation adjustments						302 669			302 669		302 669
Value changes in assets
available for sale	9						-153		-153		-153
Comprehensive income						302 669	-153	-1 534 158	-1 231 642		-23 074 -1 254 716
Purchase/ sale treasury shares	13		129					1 133	1 263		1 263
Paid dividend/ surplus								-135 406	-135 406	-2 838	-138 243
Unalloc. dividend on treas. shares								1 714	1 714		1 714
Other adjustments								26	26		26
Equity 31.12.2015		77 375	-850	1 654 186	111 648	512 749	-200	1 427 590	3 782 500	-114 924	3 667 575

STATEMENT OF CASH FLOW 1.1 - 31.12

GROUP		(NOK 1 000)
		2014	2013
CASH FLOW FROM OPERATIONS
Result before tax		-1 579 186	144 709
Taxes payable		-7 118	-22 647
Ordinary depreciation and write downs		1 829 545	461 828
Loss/ gain long-term assets		-36 076	-74 371
Interest income		-9 909	-20 860
Interest expense		480 426	454 241
Interests reveiced		9 795	20 480
Interests paid		-489 744	-453 223
Effect of change in pension assets		17 780	-2 424
Change in value of financial instruments		38 983	71 797
Unrealised currency gain/loss		619 356	678 944
Change in short-term receivables/payables		-139 686	140 851
Change in other accruals		30 122	-11 376
Net cash flow from operations	(A)	764 290	1 387 948


CASH FLOW FROM INVESTMENTS
Investment in tangible fixed assets		-127 869	-2 413 994
Payment of periodic maintenance		-170 843	-246 794
Sale of fixed assets		17 366	324 814
Payment of long-term receivables		44 348	30 633
Investments in other shares/ interests			-13 570
Realized shares and interests			800
Net cash flow from investments	(B)	-236 997	-2 318 110


CASH FLOW FROM FINANCING
Payment to minority interests		-2 838	-1 419
Payment of dividends		-133 692	-191 511
Purchase treasury shares			1 449
Sale treasury shares		1 263	-26 174
Bank overdraft		-39 251	30 974
Long-term debt		3 091 492	3 348 193
Repayment of long-term debt		-3 845 937	-2 276 855
Net cash flow from financing	(C)	-928 964	884 658

Effect of changes in foreign exchange rates		106 000	126 376

Net change in cash and cash equivalents	(A+B+C)	-401 670	-45 504
Cash and cash equivalents at 01.01		1 320 736	1 239 864
Cash and cash equivalents at 31.12	(Note 16)	1 025 066	1 320 736

NOTE 1 ACCOUNTING PRINCIPLES

The Group, Solstad Offshore ASA (SOFF), operates a shipping business from its head office in Skudeneshavn, Norway, and its main activities are the operation of offshore service and construction vessels. The Group is listed on Oslo Stock Exchange. The financial statements were approved by the Board of Directors on 18th of April 2016, and will be presented for approval in the Annual General Meeting.

Statement of Compliance and basis for preparation

The consolidated financial statements have been prepared in accordance with the Norwegian Accounting Act, International Financial Reporting Standards (IFRS) and interpretations by the International Accounting Standards Board (IASB) which is approved by the European Union (EU).

The consolidated financial statements have been prepared on a historical cost basis, except for derivative financial instruments that have been measured at fair value, and are presented in Norwegian Kroner.

Changes in accounting principles

There are no new or amended IFRS and IFRIC interpretations effective from 2015 having significant effect on the Group accounts. Hence, no changes are adopted.

Approved IFRS and IFRIC interpretations not yet implemented

IFRS 9 Financial Instruments

IFRS 9 Financial Instruments will replace IAS 39 Financial Instruments: Recognition and Measurement. In order to expedite the replacement of IAS 39, the IASB divided the project into phases: classification and measurement, hedge accounting and impairment. New principles for impairment were published in July 2014 and the standard is now completed. The parts of IAS 39 that have not been amended as part of this project has been transferred into IFRS 9.

IFRS 9 is effective for annual periods beginning on or after 1 January 2018 or later, but EU has not yet approved the standard.

IFRS 15 Revenue from Contracts with Customers

The IASB and the FASB have issued their joint revenue recognition standard, IFRS 15 Revenue from Contracts with Customers. The standard replaces existing IFRS and US GAAP revenue requirements. The core principle of IFRS 15 is that revenue is recognised to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard applies to all revenue contracts and provides a model for the recognition and measurement of sales of some non-financial assets (e.g., disposals of property, plant and equipment). The new standard is expected to be effective from January 1st, 2018, but EU has not yet approved the standard.

IFRS 16 Leases

IAS 12 Income taxes (amendment)

The amendments clarify how to account for deferred tax assets for unrealised losses on debt instruments measured at fair value, including that unrealised losses on debt instruments measured at fair value for IFRS purposes and at cost for tax purposes give rise to a deductible temporary difference regardless of whether the debt instrument's holder expects to recover the carrying amount of the debt instrument by sale or by use. The amendment is expected to be effective from January 1st, 2017, but EU has not yet approved the amendment.

IAS 7 Statement of cash flows (amendment)

The amendments introduces requirements for an entity to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes. The amendment is expected to be effective from January 1st, 2017, but EU has not yet approved the amendment.

Except for increased disclosure requirements, it is not expected that the changes will affect the financial statement significantly.

Consolidation

The consolidated financial statements comprise of the financial statements of Solstad Offshore ASA and its subsidiaries as at 31st December each year. Any deviating accounting principles are adjusted for in this consolidation.

The Group accounts state the total profit & loss and financial position of Solstad Offshore ASA and its controlling interests as a whole. The consolidated accounts include companies in which Solstad Offshore ASA has direct or indirect ownership of more than 50% of the voting shares, or otherwise has direct control, according to IFRS 10. Share options, convertibles and other equity instruments are evaluated when assessing whether control exists.

Subsidiaries are consolidated 100% line by line in the group accounts. A subsidiary is an entity where the Group has controlling interest, direct or indirect, of more than 50% of the voting shares.

Subsidiaries are consolidated from the date on which control is transferred to the Group and cease to be consolidated from the date on which control is transferred out of the Group.

Acquisitions of subsidiaries are accounted for using the purchase method of accounting. The cost of an acquisition is calculated as the fair value of assets acquired, shares issued or liabilities undertaken at the date of acquisition plus costs directly attributable to the acquisition. Any excess cost of acquisition over the fair value of the net assets of the subsidiary or joint venture acquired calculated at the date of handover, will be posted as goodwill.

All inter-company transactions, receivables, liabilities and unrealized profits, as well as intra-group profit distributions, are eliminated. In the consolidation, the profit and loss accounts of foreign subsidiaries, not using NOK as functional currency, are translated using the exchange rate on the day of transaction. The balance sheet is translated using the balance sheet date exchange rate. Translation adjustments between local currency and functional currency are classified as financial items, while adjustments arising from translation from functional to presentation currency are booked in equity.

The minority interest in equity as well as net income is reported separately in the consolidated financial statements.

Investment in associates and joint ventures

The Group's investment in its associates and joint ventures are accounted for under the equity method of accounting. An associate is an entity in which the Group has significant influence but which is not a subsidiary. A joint venture is an entity in which the Group has significant influence, but where agreements are entered, requires that strategic decisions have to be unanimous

The reporting dates of the associates, joint venture and the Group are the same and the same accounting principles are applied.

Investments in an associate and joint ventures are posted in the balance sheet at cost plus post-acquisition changes in the Group's share of net assets of the associate or joint venture, less any impairment in value. The profit and loss for the Group reflects the associates' or joint ventures' share of profits under operating costs. Changes posted directly in the associates' or joint ventures' comprehensive income or equity, are recognized pro-rata in the Group accounts, and are, where applicable, disclosed in other income and in the statement of changes in equity. Profit and loss on transactions in the associated company or joint venture are eliminated in the Group accounts in the Group's equity.

Other investments

Other investments, such as shares, loans, receivables and others are classified under one of the following categories according to IAS 39:

• Financial assets at fair value through profit and loss

o This category consists of financial assets, including derivatives, available for sale (trading) which normally are realized within 12 months after the balance day. Such assets are initially booked at fair value on the balance sheet. Changes in fair value are booked through profit and loss.

• Available for sale assets

o The category includes non-derivative financial assets which not fit into any of the other categories. If management's intention is to realize the investment within 12 months of the balance day, they are classified as current assets. The investments are initially valuated at fair value. Impairment is booked through profit and loss. All changes in fair value, including reversal of previously booked to equity through Other comprehensive income.

• Held to maturity investments

o Non-derivative financial assets with a fixed maturity date and which it is the management's intention to retain until maturity are included in this category. Such investments are initially valued at amortized cost. Any reduction in value is booked through profit and loss as impairment.

• Loans and receivables

o Loans and receivables are non-derivative financial assets with fixed payments not quoted in an active market. These financial assets are initially valuated at amortizsed cost. Any reduction in value is booked through profit and loss as impairment.

Financial investments

All investments, except for Financial assets at fair value, are initially recognized at cost, being the fair value of the consideration given and including acquisition charges associated with the investment. Transaction costs for Financial assets at fair value are accounted for through profit and loss. Transaction costs related to the change in value for Available for sale investments are recognized in Comprehensive income in the next reporting period. Other long-term investments that are intended to be held to maturity, such as bonds, are subsequently measured at the amortized cost using the effective interest method. Amortized cost is calculated by taking into account any discount or premium on the acquisition over the year to maturity. For investments booked at amortized cost, gains and losses are posted to income when the investments are devalued or depreciated as well as through the amortization process.

For investments that are actively traded in organized financial markets, the fair value is determined by reference to the stock exchange market value at the close of business on the balance sheet date. For investments where there is no quoted market price, fair value is determined by reference to the current market value of another instrument which is substantially the same or is calculated based on the expected cash flows of the underlying net asset base of the investment.

Financial investments are devalued if the right to receive cash flow from the investment no longer exists, or if the Group has undertaken an obligation to redeem the asset to a third party, without delay, on a passthrough-agreement. Furthermore, when financial investments are devalued, the right to receive cash flows from the investment is transferred together with almost all of the risk or profit from the asset, or if almost all of the risk and reward is retained, but control of the investment is transferred.

Financial liabilities are devalued when the obligation is fulfilled, cancelled or matured in accordance with the contract.

Classification of items in the balance sheet

Current assets and short term debt are posts which mature within one year of the balance sheet date as well as any posts relating to stock turnover if this occurs later. The short-term portion of the long-term debt is classified as current liability. Investments in shares not considered as strategic are classified as current assets. All other assets are classified as long-term assets.

Foreign currency translation

The functional and reporting currency of Solstad Offshore ASA is Norwegian Kroner (NOK). Transactions in foreign currencies are posted at the currency rate on the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the balance sheet date. Non-monetary items such as vessels that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of initial transaction. Non-monetary items in companies where the functional currency deviates from the reporting currency are

measured at the exchange rate at the date of the balance sheet. Any translation adjustments are included in comprehensive income.

The Group's most used currencies had the following exchange rates at the balance sheet date:

	GBP	USD	EUR	BRL
Per 31.12.14	11,571	7,4332	9,0365	2,7971
Per 31.12.15	13,072	8,8090	9,6190	2,2240

Segment information

The Group's primary reporting format is business segments and its secondary format is geographical segments. The Group's three main business activities are Anchor-Handling Vessels (AHTS), Supply Vessels (PSV) and Construction Service Vessels (CSV). Any other activities, including vessels under construction, are included in a separate segment. Overhead costs are apportioned between these segments in the same way as any other operating expenses. All accounting policies applied in the segment reporting are the same as used in the Group reporting.

The Group's geographical segments are determined by the location of the Group's vessels and operations throughout the year.

Property, plant and equipment – write-offs and depreciation

Property, plant and equipment acquired by Group companies are stated at historical cost, except the assets of acquired subsidiaries that are stated at the fair value at the date of acquisition. Depreciation is calculated on a straight-line basis and adjusted for residual value and impairment, if any. Residual value is the current estimated amount that would be obtained from disposal of the asset, after deducting the estimated costs of disposal, as if the asset were already of the age and in the condition anticipated at the end of its useful lifespan. The book value of the property, plant and equipment on the balance sheet represents the cost less accumulated depreciation and any impairment.

Each part of a fixed asset that is significant to the total cost of the item are separately identified and depreciated over that component's useful lifetime. The ships are divided into the following components: hull, anchor handling, loading and unloading equipment, thrusters, DP and lifting equipment and other equipment. Based on the Group's periodic maintenance program and running replacement the vessels vital parts, the expected lifetime of the assets is set to 30 years for all of the components, except for planned periodic maintenance.

The residual value and expected useful lifetime assumptions of long-lived assets are reviewed at each balance sheet date, and where they differ significantly from previous estimates, depreciation charges are amended accordingly.

Ordinary repairs and maintenance costs are charged to the income statement in the period in which they are incurred. The cost of major conversions and periodic maintenance of vessels is capitalised and depreciated over the useful lifespan of the parts replaced. The useful lifespan of periodic maintenance will normally be the period until the next docking, which usually is 24-36 months.

The book values of plant and equipment are reviewed for impairment if events or changes in circumstances indicate that the booked value may not be recoverable. If any such indications exist and where the book value exceeds the estimated recoverable amount, the asset or cash-generating units are depreciated to their recoverable amount. The recoverable amount of plant and equipment is the greater of the net selling price and their recoverable value. When assessing recoverable value, estimated future cash flows are discounted to their current value using a pre-tax discount rate that reflects current market assessments of the monetary value and the specific risk to the asset. For an asset that does not generate cash inflow, a recoverable amount is calculated for the cash-generating unit to which the asset belongs. Any previously calculated depreciation is reversed if there are any amendments to the estimates used to calculate the recoverable amount. Reversal of previously calculated depreciation is limited to the book value of the asset if its value had not been impaired.

The business segments are the Group's strategic units of control. However, while calculating the recoverable amount, each vessel is treated as one cash-generating unit.

Gains and losses on disposal are determined by comparing the disposal proceeds with the book value and any profit or loss is included in operating profit.

New build contracts

Installments on new build contracts are posted in the balance sheet as fixed assets. Costs related to the on-site supervision and other pre-delivery construction costs including construction loan interest are capitalized per vessel. The depreciation starts from when a new build is delivered from the yard.

Leases

Lease of property, plant and equipment where the Group has all the risks and rewards of ownership, are classified as financial leases. Financial leases are capitalized at the inception of the lease at the lower of the fair value of the leased property or the present value of the minimum lease payments. Each lease payment is allocated between the liability and finance charges. The corresponding rental obligations, net of finance charges, are included in other long-term interest-bearing liabilities. The interest element of the finance cost is charged to the income statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Property, plant and equipment acquired under finance leases are depreciated over the shorter of the useful lifetime of the asset or the lease term.

Any leases where a significant amount of the risks and rewards of ownership are retained by the lessor, are classified as operating leases. Payments made under operating leases net of any incentives received from the lessor are charged to profit and loss on a straight-line basis over the period of the lease.

Trade and other receivables

Trade receivables are booked at their anticipated realizable value, which is the original invoice amount less an estimated amount for depreciation of these receivables. Assessment of provision for bad debts is calculated when there is objective evidence that the Group will not be able to collect all amounts due in accordance with the original terms and conditions.

Cash and cash equivalents

Cash and cash equivalents comprise of cash in hand, short-term deposits and other short-term highly liquid investments with maturity dates of less

than three months. Bank overdrafts are included within borrowings in current liabilities on the balance sheet.

Tied bank deposits are funds on separate bank accounts for tax deductions.

Treasury shares

The nominal value of treasury shares held is deducted from registered share capital. Any differences between the nominal value and the acquisition price of treasury shares, together with any gains or losses on transactions therein, are recorded directly to reserves.

Interest-bearing loan and borrowings

All loans and borrowings are initially recognized at cost, being the fair value of the consideration received net of issue costs associated with the borrowing.

After initial registration, interest-bearing loans and borrowings are subsequently measured at amortized cost using the effective interest method. Amortized cost is calculated by taking into account any issue costs, and any discount or premium on settlement.

Gains and losses are recognized in net profit or loss when the liabilities are devalued or depreciated.

Provisions

Provisions are made in the financial statements if the Group considers it likely, based on the legal provisions or business liabilities of past events, that an outflow of resources will be required to cover its liabilities and if the amount can be accurately estimated. All provisions shall be reviewed on the balance sheet date and adjusted, if necessary, to reflect a more accurate estimate. In instances where the timeframe may be of significance, a provision is made for the current value of future payments to cover liabilities. Provisions are not made for future operating losses

Tax

The tax expense in the Financial Statement consists of payable tax and changes in deferred tax.

Companies taxed under The Norwegian Shipping Tax Regime will not be taxed on its net operating profit. Taxation under the shipping tax regime requires compliance to stringent requirements, and voluntary or compulsory exit from the regime will result in taxation of net profits based on ordinary taxation. Net taxable financial income is taxed according to the shipping tax regime (27%).

Operations on foreign continental shelves are, in a number of cases, taxable to the state of operation. In such cases the tax is computed according to the tax legislation of the current state, combined with any double taxation avoidance agreement between the state where the ship owner is registered and the state where the operation is performed. Income tax based on a net result is classified as income tax. Other taxes are classified as contract related expenses.

Deferred tax is calculated using the liability method at 25% of all temporary differences between the taxable value of assets and liabilities and their booked amounts at the end of the accounting year. Any temporary differences that may increase or decrease tax are offset and posted as a net figure.

Deferred tax is calculated for assets and liabilities for which future realization will lead to tax payable.

The recognized amount of deferred tax assets is reviewed at each balance sheet date. If it is no longer likely that adequate taxable profit will be generated, then the deferred tax asset will be reduced. Anticipated utilization of tax losses are not discounted when calculating the deferred tax asset.

The treatment of the exit-taxation from the former Shipping Tax Regime in Norway is explained in Note 12.

Tonnage tax paid under the tonnage tax regime is classified as operational expenses.

Pension obligations

The Group has a defined benefit plan for seamen and administrative personnel, and a contribution plan for administrative personnel hired after 1.1.2007, which is expensed on current basis. The liability of the defined benefit pension plan is the present value of the defined benefit liability at the balance sheet date minus the fair value of plan assets, together with adjustments for actuarial gains and losses and administration costs. The defined benefit liability is calculated by independent actuaries using the projected unit credit method and is measured as the present value of the estimated future cash outflows using interest rates of government securities that have terms maturing at the same time as the liability.

The cost of providing pensions is charged to profit and loss to spread the regular cost over the working lives of the employees. Actuarial gains and losses are recognised in comprehensive income in the period they occur.

Posting to Income Charter income

Revenue and expenses relating to charter contracts are apportioned according to the number of days for each contract occurring before and after the end of the accounting period. The contract begins when the vessel is "delivered" to the charterer, and ends when the vessel is "redelivered". Freight revenue is posted net after deduction for direct, contract-related freight costs. Any loss on contracts is accrued when a loss is probable.

Rental income

Revenue classified as rental income is recognized in the period of which is performed, and is accrued at the end of the accounting period.

Dividends

Dividends are calculated when the shareholder's right to receive the payment is established (by resolution at the general meeting).

Other income

Other income, such as commissions, provisions, management fees, are recognized in the period in which they are performed.

Government grants

Grants related to the net tax agreement and crew subsidiaries are posted as a reduction in cost.

Financial derivatives

The Group uses financial derivatives such as foreign currency contracts and interest rate swaps to reduce the risk associated with interest rates and foreign currency fluctuations. Such financial derivatives are stated at fair value. Gains and losses on derivatives are booked directly to profit and loss

Related party transactions

All transactions and agreements with related parties are on an "arm's length" basis in the same way as transactions with third parties.

Stock

Stock consists mainly of bunkers onboard the vessels. Stock is valued at the lower of cost price and fair value. First-in-first-out method is used.

Earnings per share

The calculation of basic earnings per share is based on the majority's share of the result using the weighted average number of shares outstanding during the year after deduction of the average number of treasury shares held over the period.

Cash Flow

The Group applies the indirect method. Investment in shares and other liquid assets with maturity over three months are not included under cash equivalents.

Use of estimates and key measuring items

The preparation of financial statements in conformity with IFRS requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting periods. Accounting estimates are employed in the financial statements to determine reported amounts. Useful lifespan and residual value of vessels, depreciation of planned maintenance, depreciations and impairment, pensions, contingent liabilities and taxes are items where the use of estimates may have significant impact on reported amounts.

Useful lives of vessels affect the ordinary depreciation. Useful life of the vessel's different components is based on the condition and experience of wear and tear of each group of components. The main change is an assumption to operate the vessels for 20 years instead of the full physical lifetime.

Residual value of vessels will affect ordinary depreciation. The vessels market values are used as basis for the residual value. Market values, less any sales related expenses, are multiplied with a percentage dependent on the age of the vessel. The factor is 50% for a newbuild, increasing to 100% for a 20 year old vessel.

Depreciation of planned maintenance is affected by the estimated interval between each dry docking. This interval is determined based on experience for the Groups' fleet combined with official requirement for classification of the vessels.

Pension is an estimate impacted by several assumptions. The discounted rate and expected regulation of salary has a significantly high impact. The regulation of salaries is based on experience and anticipation related to subsequent salary regulation in the business. The discounted rate is based on the Norwegian Covered Bonds Market interest rate.

Provision for contingent liabilities and taxes is based on collating information on a case by case basis. The probability of a contingent liability occurring which would affect the provision is evaluated. The discounting rate used for liabilities is based on a risk-free interest rate, adjusted to the maturity date.

Impairment testing is based on numerous estimates. Main elements are future revenues (rates), expected prolonging of existing contracts, level of running costs, expected return on equity, general marked prospects and useful life of fixed assets. Relating to financial assets, measurements are based on observable marked prices, public accounting information and general and specific marked prospects relevant to the certain financial asset.

Allocation of excess value relating to any business combinations is, amongst other, based on expected cash flows and results from the certain items of the acquired assets.

Although these estimates are based on Management's best knowledge at the time of submitting the accounts, actual figures may differ from the estimates.

Provision for contingent liabilities and taxes is based on collating information on a case by case basis. The probability of a contingent liability occurring which would affect the provision is evaluated. The discounting rate used for liabilities is based on a risk-free interest rate, adjusted to the maturity date.

Allocation of excess value relating to any business combinations is, amongst other, based on expected cash flows and results from the certain items of the acquired assets.

Although these estimates are based on Management's best knowledge at the time of submitting the accounts, actual figures may differ from the estimates.

NOTE 2 MAJOR TRANSACTIONS/EVENTS

Major transactions/ events in 2015:

In the second quarter an anchorhandling vessel was sold and delivered to new owners.

In the second quarter two fleet loans, NOK 800 million and USD 150 million respectively, were refinanced.

In the fourth quarter two fleet loans, totalling to USD 114.7 million, were refinanced.

Agreements for sale of two older anchor handling vessels were entered into in the fourth quarter. The vessels were delivered to new owners in January 2016.

Major transactions/ events in 2014:

In the 1st quarter, the Group sold one older construction service vessel, Normand Tonjer, and one smaller anchor handling vessel, Nor Sun. A gain of NOK 25 million was booked.

Agreement for building of NB830, TBN Normand Maximus was signed in the first quarter. This vessel is the largest and most advanced in the Groups history, and has a contract price of USD 367 million. The vessel is build for a long term comtract with Saipem.

In the second quarter the Group took delivery of the construction service vessel Normand Reach. The vessel, with a cost price of NOK 650 million, started immediately on a 5 year contract. Further, a smaller anchor handling vessel, Nor Supporter, was sold. A loss of NOK 10 million was posted.

The construction service vessel Normand Vision was delivered in July 2014. Simultaneously the Group aqcuired the all the shares in the vessel owning company. The vessel had a cost price of USD 250 million.

In the fourth quarter an older anchor handling vessel, Normand Draupne, was sold. A gain of NOK 31 million was booked.

During the year a bond loan of NOK 700 million repaid and replaced by a new bond loan of NOK 1.000 million.

NOTE 3 FINANCIAL RISK MANAGEMENT AND FINANCIAL INSTRUMENTS

GENERAL. General. The Group is exposed to different financial market risks. Financial market risk is the impact of fluctuations on currency rates, interest rates and freight rates on the value of the Group's assets, liabilities and future cash flows.

To reduce and control these risks, management periodically evaluate the Group's most important financial market risks. Once a risk factor is identified, action is taken to reduce this risk. The main strategy to reduce financial market risk is the use of financial derivatives, both for the specific exposure and for the net exposure of the Group. If financial derivatives are appropriate, only conventional derivatives are used. The Group only uses recognized financial institutions.

Derivatives are only used to manage the risk to fluctuations in interest and currency rates. The Group does not use financial derivatives to achieve financial income if no underlying exposure exists.

Management performs a continuous evaluation of the effect of financial instruments on the accounts with a view to hedge accounting. Based on this evaluation, hedge accounting is not used.

The use of financial instruments is not significant when compared to the Group's level of activity, revenues and equity.

CREDIT RISK. In the current marked the credit risk has increased, hence the Group's exposure for losses on trade accounts receivables is higher. However, no material losses are anticipated. As at December 31, 2015, accounts receivables were NOK 635 million (NOK 757 million in 2014). The Group is also exposed to losses if a counter party in a financial derivative contract fails to fulfil their payment obligations on the settlement date. Non-fulfilment of such contracts is not anticipated as the Group only uses well known conventional derivatives with recognized financial institutions.

Further, the Group is exposed through guarantees issued on behalf of subsidiaries, joint ventures and associated companies. As the value of the assets placed as security for the guaranteed mortgages exceeds the loans, the credit risk related to the guarantees is considered to be low. Further refer to note 11.

The following table shows the ageing trade accounts receivables:

		0 - 1 month	1- 3 months	Older than
per 31.12.2014	Not yet due	over due	over due	3 months	Total
Trade accounts receivable	556 310	72 599	49 435	78 449	756 794

90% of the trade accounts receivable at year-end relates to 40 customers. The top 10 customers amount to 49% of total trade accounts receivable.

		0 - 1 month	1- 3 months	Older than
per 31.12.2015	Not yet due	over due	over due	3 months	Total
Trade accounts receivable	319 991	67 163	56 012	191 907	635 073

90% of the trade accounts receivable at year-end relates to 22 customers. The top 10 customers amount to 68% of total trade accounts receivable. An accrual of NOK 34 million is booked relating to bad debt at 31.12.2015. As per 31.12.2014 the accrual was NOK 29 million.

The following table shows customers with more than 10% of total revenue:

	Segment
Customer	Total revenue	PSV	AHTS	CSV
Petrobras - Brazil	535 717	153 838	381 880

INTEREST RISK. TThe Group's exposure to fluctuations in interest rates is mostly due to its long-term liabilities with floating interest rates. With regard to interest rate fluctuations, the strategy is to limit the impact on cash flow due to fluctuations in the interest rate level. Depending on the development in the interest market, the Group enters into different types of interest rate contracts.

As at December 31, 2014 the Group has entered 5 fixed interest rate contracts, up to 3 years maturity, for approximately 18% of total debt. Further, 4 fixed interest rate contracts, as CIRR financing up to 4 years maturity, are entered in to for approximately 17% of the debt. The remaining 65% of the debt has floating interest. As at December 31, 2014, the interest swaps have a negative value of NOK 6 million (negative NOK 6 million in 2013). The Group has entered 2 interest and currency swap agreements up to 5 years maturity. At December 31, 2014 these agreements have a net negative value of NOK 60 million (positive NOK 12 million in 2013), and accounts for about 1% of total debt.

The following table shows the sensitivity of the Group's result before taxes at a reasonable change in the interest rate, while all other variables are unchanged:

Increase/ decrease		Effect on result
of basis points		before tax
+ / - 100	2015	+ / - 105.611
+ / - 100	2014	+ / - 92.666

FOREIGN CURRENCY RISK. Revenues are divided into NOK, USD, GBP and EUR. The Group's future freight revenues are partly hedged using foreign currency loans. Furthermore, some revenue is sold forwards. This hedging reduces the effect of any fluctuation in currency rates on the profit and loss account. The Group's long-term debt has the following allocation as at December 31, 2014; NOK 43%, USD 48% and GBP 9%. The corresponding allocation for 2014 was 40% USD, 48% NOK and 12% GBP.

The following table shows the sensitivity of the Group's profit and loss before tax due to changes in USD, GBP and EUR versus NOK. All other variables remain unchanged. These variations are mainly due to changes in the Group's freight income.

Increase/decrease		Effect on result
in all currencies		before tax
+ / - 10%	2015	+ / - 311.353
+ / - 10%	2014	+ / - 319.792

Increase/decrease		Effect on result
in USD		before tax

+ / - 10%	2015	+ / - 219.922
+ / - 10%	2014	+ / - 204.866

Increase/decrease		Effect on result

/ - 10% 2014 + / - 61.847
/ - 10% 2015 + / - 43.395

Except for translation adjustments relating to foreign entities in foreign currency, further effect on equity is considered immaterial.

LIQUIDITY RISK. The Group's objective is to maintain a balance between external and equity financing. Use of loans, bank overdraft and financial leasing are instruments used to maintain this balance. Furthermore, the Group's objective is that unrestricted equity shall, at all times, exceed 10% of long-term interest bearing loans. This objective was met by the end of 2014, but not by 2015.

Loans with maturity within the next 12 months are significantly higher than last year. This increase relates amongst others to a bond loan of NOK 700 million with maturity in 2016. This loan has already been repaid.

The Group monitors the risk of lack of available capital by thorough evaluation of the maturity of its financial investments, financial assets and projected cash flows from operations. Based on this negotiations with the Group's lenders has begun to adapt the maturity structure on the company's mortgage debt to cash flow from operations through reduced installments and extension of the overall debt's maturity structure.

Risk management includes maintenance of sufficient liquid assets and the possibility of financing through credit facilities.

The following table shows the maturity for the Group's financial obligations based on contractual, un-discounted cash flows.

	Less than	3 to 12	2 to 3	4 to 5	over 5
per 31.12.2015	3 months	months	years	years	years	Total
Interest bearing loans	1 040 055	1 562 603	3 725 049	5 012 777	168 012	11 508 495
Other debt				367 703		367 703
Trade accounts payable	118 059					118 059
Interest payments	78 796	298 790	527 299	168 267	9 859	1 083 011
	1 236 909	1 861 393	4 252 348	5 548 747	177 870	13 077 268
per 31.12.2014 Interest bearing loans	Less than 3 months 324 587	3 to 12 months 919 692	2 to 3 years 4 312 823	4 to 5 years 5 648 068	over 5 years 133 953	Total 11 339 123

Other debt				331 886		331 886
Trade accounts payable	371 529					371 529
Interest payments	90 185	359 773	948 679	826 789	19 609	2 245 034
	786 301	1 279 465	5 261 502	6 806 743	153 562	14 287 572

CAPITAL STRUCTURE. One of the Group's main goals is to maintain its strong creditworthiness and solidity to support the Group's business and to maximize the share value. The Group manages and adjusts its capital structure based on changes in economical structures and assumptions. Its policy is to maintain or adjust the Group's capital structure by changes in dividend to the shareholders, issuing of new shares or sale of assets to reduce debt.

The Group monitors the capital based on equity versus total assets. The ratio is calculated as booked equity divided by total assets. The aim is to have a ratio above 30%. This goal was not reached at the end of 2014, and the market conditions for the industry has lead to a decreasing equitu share during 2015. The Group has one newbuild to be delivered. The vessel has a firm contract from delivery.

		December 31st
	2015	2014
Total equity	3 667 575	5 057 532
Total assets	16 228 064	17 745 988
	23 %	28 %

FAIR VALUE. Estimated market values on financial instruments nominated in other currencies than NOK are determined using the currency rate at the balance sheet date. Fair value of the Groups interest- and interest-/currency swaps are determined using the currency - and interest rate at the balance sheet date. Nominal value of cash and loan obligations are a reasonable estimate of the items' market value. The estimated fair value of the Group's long-term loan obligations is based on the interest level at the balance sheet date. The fair value of the shares in a non registered organisation is estimated on the organisations latest financial report, focusing on the Group's share of booked equity, and therefore a thorough evaluation is required prior to estimating the market value.

INTEREST RATE RISK. The following table shows the book value and maturity of the Group's financial instruments exposed to changes in interest rates.

	Nominal	Yearly		Interest		Value as at	Value as at
Fixed rate	value	regulation	Currency	rate	Maturity	31-12-15	31-12-14
Contract 1	36 885	7 377	USD	1,98 %	05-01-18	-3 222	-4 908
Contract 2	37 500	4 167	USD	0,93 %	20-04-16	-222	-1 253
Contract 3	90 406	18 156	USD	0,70 %	27-04-16	-863	-2 207
Contract 4	85 000	10 000	USD	0,93 %	09-04-18	2 250	4 031
Contract 5	19 000	1 000	GBP	1,40 %	28-06-18	-1 443	-1 709

	Nominal	Yearly			Value as at	Value as at
Interest- and currency swap contracts	value	regulation	Currency	Maturity	31-12-15	31-12-14
Interest- and currency swaps NOK/USD	202 500	45 000	NOK	05-07-19	-61 043	-33 993
Interest- and currency swaps NOK/USD	68 190	20 713	NOK	29-05-15		-2 622
					-61 043	-36 616

Financing risk

The following table shows the total mortgage loan based on existing financing and their maturity dates as per 31.12.2015:

	Currency	Mortgage loan	Drawn	Maturity	Duration	Interest
Loan, fixed interest	USD	1 527 736	1 445 227	28-06-19	41	3,94 %
Loan, floating interest	USD	41 292	41 292	28-06-19	41	2,78 %
Loan, floating interest	USD	660 675	660 675	09-04-18	27	3,70 %
Loan, floating interest	USD	1 010 568	1 010 568	28-10-20	57	2,69 %
Loan, floating interest	GBP	155 230	155 230	23-04-18	27	3,47 %
Loan, floating interest	NOK	311 458	311 458	29-05-20	52	3,61 %
Loan, floating interest	GBP	392 160	392 160	27-06-18	29	3,35 %
Loan, floating interest	NOK	142 500	142 500	23-04-18	27	4,24 %
Loan, floating interest	NOK	250 317	250 317	06-01-17	12	3,48 %
Loan, floating interest	USD	238 577	238 577	29-06-17	17	3,53 %
Loan, floating interest	USD	127 783	127 783	16-09-19	44	2,34 %
Loan, floating interest	USD	1 233 172	1 233 172	01-06-20	53	2,90 %
Loan, fixed interest	NOK	60 000	60 000	15-03-19	38	5,45 %
Loan, floating interest	NOK	570 890	570 890	29-05-20	52	3,83 %
Loan, floating interest	NOK	317 917	317 917	06-11-17	22	4,47 %
Loan, floating interest	NOK	284 375	284 375	10-04-17	15	4,82 %
Loan, floating interest	NOK	402 333	307 667	05-05-22	76	4,40 %
Loan, floating interest	NOK	86 778	86 778	05-05-22	76	4,39 %
Loan, floating interest	NOK	31 950	31 950	05-05-20	52	4,37 %
Loan, fixed interest	NOK	471 750	446 250	03-06-19	41	4,07 %
Loan, floating interest	NOK	12 750	12 750	03-06-19	41	4,13 %
Loan, fixed interest	NOK	180 000	180 000	10-06-19	41	5,76 %
Loan, floating interest	USD	204 369	204 369	18-12-18	35	3,24 %
Loan, floating interest	GBP	455 341	455 341	23-09-19	44	3,23 %
Loan, fixed interest	NOK	66 267	66 267	30-09-19	44	5,35 %
Loan, floating interest	NOK	75 000	75 000	15-09-16	8	3,14 %
Loan, floating interest	USD	685 982	685 982	18-07-16	6	1,40 %

Total mortgage loan in NOK		9 997 170	9 794 494
Bank overdraft	USD	147 827	82 656	13-12-16	12	0,59 %
Bond loan - NOK	NOK	700 000	700 000	25-02-16	13	6,11 %
Bond loan - NOK	NOK	1 000 000	1 000 000	24-06-19	53	5,15 %
Total bond loans		1 700 000	1 700 000

Foreign currency risk

The following table shows the booked value of forward contracts. All active forward contracts are

	Value based on	Value as at	Value based on	Value as at
Purchase / sale currency	forward contract	31.12.15	forward contract	31.12.14
Currency contract NOK/USD (current)	475 536	-32 563	0	0
Currency contract NOK/USD (long-term)	121 778	-7 878	0	0
Total currency contracts	597 314	-40 440	0	0

FAIR VALUE

The following table shows the booked and fair value of financial assets and obligations.

Financial assets			2015		2014
	Note	Booked value	Fair value	Booked value	Fair value
Cash at bank	11,18	1 025 066	1 025 066	1 320 736	1 320 736
Investments in shares (long-term)	9	45 294	45 294	46 314	46 314
Other long-term financial investments		4 194	4 194	34 966	34 966
		1 074 554	1 074 554	1 402 017	1 402 017
Financial obligations			2015		2014
	Note	Booked value	Fair value	Booked value	Fair value
Short-term part of long-term debt	11	2 520 002	2 520 002	1 122 371	1 122 371
Loan with floating interest	11	8 920 429	8 509 386	10 422 511	10 362 557
Loan with fixed interest	11	2 505 410	2 501 909	794 704	788 659
		13 945 841	13 531 298	12 339 587	12 273 587

Fair value hierarchy

The Group use the following hierarchy for valuation and presentation of financial instruments:

Level 1: quoted prices in active markets for identical assets or liabilities

Level 2: other techniques for which all inputs which have significant effect on the recorded fair value are observable, either directly or indirectly Level 3: techniques which use inputs which have significant effect on the recorded fair value that are not based on observable market data

The Group's level 1 includes shares in listed companies, refer to note 9 for further details.

Level 2 includes fixed interest contracts, interest and currency swap contracts, currency contracts and mortgage debt, refer above for further details. Level 3 includes non-registered shares, refer to note 9 for further details.

The following table show book value of financial instruments according to the hierarchy above:

		2015			2014
	Level 1	Level 2	Level 3	Level 1	Level 2	Level 3
CURRENT FINANCIAL ASSETS
Shares	229			382
Total per level	229			382
Total all levels	229			382
NON CURRENT FINANCIAL ASSETS
Shares			2 991			2 991
Total per level			2 991			2 991
Total all levels	2 991			2 991
Fixed interest contracts		2 250			4 031
Interest- and currency swaps
Currency swap contracts
Total per level		2 250			4 031
Total all levels	2 250			4 031
CURRENT FINANCIAL LIABILITIES
Fixed interest contracts		1 085
Interest- and currency swaps					25 961
Currency swap contracts		32 563
Total per level		33 648			25 961
Total all levels	33 648			25 961
NON CURRENT FINANCIAL LIABILITIES
Fixed interest contracts		4 665			10 077
Interest- and currency swaps		61 043			33 993
Currency swap contracts		7 878
Guarantees			21 018			21 018
Debt to credit institutions		8 905 838			10 094 844
Other liabilities						800
Total per level		8 979 423	21 018		10 138 915	21 818
Total all levels	9 000 440			10 160 732

NOTE 4 REPORTING BY SEGMENTS AND GEOGRAPHICAL MARKETS

The Group's main activity is to offer ships and maritime personnel in all geographical regions. The business is divided into three segments based on the different types of vessels: Anchor-Handling Vessels (AHTS) delivering services related to rig moves and anchoring of rigs and other devices at sea, Platform Supply Vessels (PSV) delivering services relating to transportation of material to offshore installations and Construction Service Vessels (CSV) delivering services relating to development of both sub sea and floating installations.

Results from associated companies (TS) are allocated to the segments based on number of ships per segment while the allocation of investments is based on book value of each ship in its current segment.

Revenues 2015 2014 Net reveneus 909 153 1 318 685 Deferred income from assets 28 082 35 233	2015 371 944 11 489	2014 466 601


		12 015
Total operating income 937 235 1 353 918	383 432	478 615
Results
Operating result -437 277 431 512	-681 276	85 327
Result from associated companies
Operating result (1) -437 277 431 512	-681 276	85 327
Assets and liabilities
Fixed assets 3 370 434 3 903 739	1 111 010	1 781 026
Total assets 3 370 434 3 903 739	1 111 010	1 781 026
Segment liabilities 2 582 066 2 574 457	1 014 254	1 124 169
Total liabilities 2 582 066 2 574 457	1 014 254	1 124 169
Other segment information
Investment in tangible fixed assets 3 923 31 372	758	8 294
Payment of periodic maintenance 30 774 62 650	34 902	5 971
Translation adjustment 121 993 122 705	77 372	91 476
Depreciations and write-downs (2) 710 916 153 334	765 383	61 351
CSV		Other
Revenues 2015 2014	2015	2014
Net reveneus 2 265 321 1 952 063
Deferred income from assets 69 971 95 577
Total operating income 2 335 292 2 047 640
Results
Operating result 718 272 671 678	-732	-745
Result from associated companies 65 878 63 779	-1 021	876
Operating result (1) 784 150 735 457	-1 752	131
Assets and liabilities
Fixed assets 9 001 695 8 886 008	306 485	202 631
Investments in associated companies 345 162 347 213	41 173	43 323
Total assets 9 346 857 9 233 221	347 658	245 954
Segment liabilities 6 242 112 5 887 239
Total liabilities 6 242 112 5 887 239
Other segment information
Investment in tangible fixed assets 9 850 2 220 368	113 338	153 960
Payment of periodic maintenance 105 167 168 450
Translation adjustment 351 680 350 630	606	860
Depreciations and write-downs (2) 345 808 239 690	7 439	7 452

		Total
Revenues	2015	2014
Net reveneus	3 546 418	3 737 349
Deferred income from assets	109 542	142 824
Total operating income	3 655 959	3 880 173
Results
Operating result	-401 014	1 187 772
Result from associated companies	64 858	64 656
Operating result (1)	-336 156	1 252 428
Assets and liabilities
Fixed assets	13 789 625	14 773 404
Investments in associated companies	386 335	390 536
Unallocated assets	2 052 104	2 582 048
Total assets	16 228 064	17 745 988
Segment liabilities	9 838 432	9 585 865
Unallocated liabilities	1 587 407	1 631 351
Total liabilities	11 425 839	11 217 216
Other segment information
Investment in tangible fixed assets	127 869	2 413 994
Payment of periodic maintenance	170 843	237 071
Translation adjustment	551 651	565 670
Depreciations and write-downs (2)	1 829 545	461 828

(1) The segment result is presented exclusive interests, currency gain/ loss and other financial items.

(2) Depreciation includes both ordinary depreciation and depreciation of periodic maintenance. For allocation of revenues and cost on different segments. see note 1.

The Group's vessels operate in several geographical areas during a year. Allocation between the different areas is based on freight revenue. In 2015, PSV revenue is mainly from activity in the North Sea, Brazil and West Africa, while revenues for AHTS and CSV activity are divided over all geographic areas.

Net revenues are allocated to the following areas:	2015			2014
North Sea	33 %	1 171 375	37 %	1 387 127
North- and Central America	16 %	561 553	13 %	467 927
Mediterranean/remaining part of Europe	5 %	188 565	4 %	154 254
West Africa	6 %	195 244	4 %	133 846
South America	21 %	742 789	20 %	754 064
Asia	19 %	686 892	22 %	840 131
Total	100 %	3 546 418	100 %	3 737 349

The Group's vessels generally operate in more than one geographic region during the year. Therefore assets cannot be allocated per segment in accordance with IFRS 8.

NOTE 5 OTHER INCOME, OTHER EXPENSES, WAGES, EMPLOYEES AND DISTINCTIVE CONTRIBUTIONS
Other operating income	2015	2014
Gain on sale of vessels		46 591
Management fees	8 488	6 793
Victualling	70 170	85 791
Rental of personnel and equipment	30 884	3 650
Total other operating income	109 542	142 824
Other operating expenses	2015	2014
Technical cost	287 083	391 785
Bunkers and lube oil	78 539	69 789
Insurance	74 191	65 550
IT, communications and other costs	459 861	325 369
Total other operating expense	899 675	852 492
Wages and personnel costs	2015	2014
Employees, vessels	1 207 450	1 219 758
Employees, administration	188 114	174 356
Total employee cost	1 395 564	1 394 114
Wages and employee cost	2015	2014
Wages	1 013 336	1 052 834
Social security	113 168	96 478
Pension costs	47 034	34 601
Other benefits	80 537	67 905
Travelling costs, courses and other personnel costs	141 488	142 296
Total employee cost	1 395 564	1 394 114
Average number of employees	1638	1848

There are no distinctive agreements regarding remuneration for the Chairman of the Board and neither are there any distinctive bonus or option programmes for any Board Member or Group Management. No loans have been given to the company management. The Managing Director has an agreement securing 12 months salary.

REMUNERATION TO DIRECTORS, MANAGING DIRECTOR AND AUDITORS

Charged cost during the year	Director's fee	Wages Other benefits		Pension cost
Key personnel (*):
2015	12	8 083	480	415
2014	12	4 241	320	346

Board of Directors:	Directors fee
Terje Vareberg	341
Toril Eidesvik	210
Anders Onarheim	158
Anette Solstad	158
Ketil Lenning	158

(*) For further details refer to Parent company note 4. In 2014 Key personnel was 2 employees. In 2015 this group was 5 employees.

	2015	2014
Audit - statutory accounts	2 881	2 649
Other attestation services	28	33
Tax related services	8 325	3 425
Other services		21
Total	11 234	6 127

Audit fees relates to statutory audit of accounts. Fee for tax advice is mainly assistance related to tax reporting to authorities in other countries. For 2015 these services are mainly realted to crew, and hence, they are viewed as compliance services. Auditor-related services include consultancy, reports and assistance on accounting matters.

NOTE 6 PENSION

The Group has one defined benefit pension plan seafaring personnel on Norwegian tariffs, and for some of the administrative personnel.. The pension plan is insurance based. As at December 31, 2015, there are 615 members of the pension plan.

The Group has a contribution plan for the majority of administrative staff. Personnel employed prior to 1.1.2007 could choose membership of either scheme. Employees joining the firm after 1.1.2007 are automatically members of the contribution plan. At 31st December 2015 the plan had 61 members.

The following assumptions are used:	2015	2014
Discounted interest	2,30 %	4,00 %
Expected return	2,30 %	4,00 %
Regulation of salaries	2,75 %	3,75 %
Regulation of base amount	2,50 %	3,50 %
Regulation of pension	2,50 %	3,50 %
Changes in pension obligation	2015	2014
Estimated liability at beginning of the year	306 681	256 672
Interest expense	6 776	9 888
Annual pension earnings	29 139	26 849
Benefits paid	-10 102	-8 978
Actuarial (gain)/ loss on the obligation	-69 186	22 250
Estimated liability at year end	263 308	306 681
Changes in plan assets
Opening value of plan assets	207 899	185 002
Expected return	4 352	7 292
Contributions by employer	17 073	29 848
Benefits paid	-10 102	-8 978
Administration expense
Actuarial gain/ (loss)	-6 586	-5 264
Estimated plan assets at year end	212 636	207 899
Expected contribution by employer in 2016 is NOK 19 million.
Net plan assets/liabilities
Pension liabilities	263 308	306 681
Plan assets	212 636	207 899
Net plan assets/ (liabilities) incl sosial security	-50 672	-98 781
Social security	-6 262	-12 207
Pension cost
Present value of pension obligation	25 194	23 211
Interest expense on obligation	6 776	9 888
Expected return on plan assets	-4 352	-7 292
Administration expense	302	280
Changes in assumptions charged
Social security	3 643	3 357
Pension cost	31 563	29 445
Payments on contribution plan	19 115	8 513
Actual return on plan assets	-2 234	2 028
Total pension cost	50 678	37 959

Actuarial gain and loss (-)	2015	2014
Total actuarial gain/ loss	62 599	-27 514
Tax effect	15 650	-7 429
Actuarial gain/ loss booked in Other comprehensive income	46 949	-20 085

Pension liability for 2013 and 2014 is based on table K2013

Plan assets are invested in a wide portfolio by an external insurance company. The insurance company is responsible for total administration of the pension plan. For both years the "Norwegian Covered Bonds Market"-interest rate is used as basis for determination of the discounting rate.

Percentage composition of pension funds:	2015	2014
Equities	6,1 %	7,2 %
Alternative investments	4,0 %	4,0 %
Bonds	13,6 %	15,3 %
Money market	25,2 %	23,5 %
Hold to maturity bonds	33,9 %	32,6 %
Real estate	14,7 %	14,2 %
Other	2,6 %	3,3 %

NOTE 7 FINANCIAL ITEMS

Financial items	2015	2014
Interest expense	-480 426	-454 241
Interest income	9 909	20 860
Currency loss	-1 387 614	-1 240 676
Currency gain	733 796	641 942
Income from investment in associated companies	-1 021	876
Gain financial derivatives	19 270	17 500
Loss financial derivatives	-130 638	-84 278
Gain sale shares		599
Dividends	11	11
Other financial income/ -expense (-)	-7 339	-9 436
Net financial items	-1 244 050	-1 106 842

Currency gain and -loss is mainly relating unrealized currency gain and -loss on assets and liabilities in foreign currency, and change in currency rates in the period from posting of invoices and actual timing of payments.

NOTE 8 TANGIBLE FIXED ASSETS		Vessel under
	Vessel	construction	Fixtures	Total
Cost price 01.01.2014	16 339 656	37 299	83 427	16 460 382
Acc. depreciation/ write down 01.01.2014	-4 489 422		-64 603	-4 554 025
Book value 01.01.2014	11 850 234	37 299	18 824	11 906 357
Additions	2 202 595	199 589	11 810	2 413 994
Transfer	57 964	-57 964
Disposals	-392 396		-731	-393 127
Disposal of acc. depreciations/ write downs	264 910		377	265 287
Translation adjustment	564 810		860	565 670
Cost price 31.12.2014	18 772 629	178 925	95 366	19 046 920
Acc. depreciations/ write downs 31.12.2014	-4 492 109		-71 660	-4 563 769
Book value 31.12.2014	14 280 520	178 925	23 706	14 483 150
Depreciation/ write down current period	-267 598		-7 434	-275 032
Cost price 01.01.2015	18 772 629	178 925	95 366	19 046 920
Acc. depreciation/ write down 01.01.2015	-4 492 109		-71 660	-4 563 769
Book value 01.01.2015	14 280 520	178 925	23 706	14 483 150
Additions	14 531	98 300	15 038	127 869
Disposals	-86 958			-86 958
Transfer to asset helt for sale	-16 288			-16 288
Disposal of acc. depreciations/ write downs	81 817			81 817
Translation adjustment	551 045		606	551 651
Cost price 31.12.2015	19 234 959	277 225	111 009	19 623 194
Acc. depreciations/ write downs 31.12.2015	-6 046 592		-81 750	-6 128 341
Book value 31.12.2015	13 188 368	277 225	29 259	13 494 853
Depreciation/ write down current period	-1 636 299		-10 089	-1 646 389

Capitalized periodic maintenance	2015	2014
Capitalized periodic maintenance at 01.01	290 253	230 255
Additions this year	170 843	237 071
Disposal this year	-12 205
Transfer to asset held for sale	-7 823
Depreciation of planned periodic maintenance this year	-183 157	-186 795
Translation adjustment	12 749	9 723
Capitalized periodic maintenance at 31.12	270 661	290 253

The vessels are divided into the following categories; hull, anchor-handling-, loading- and unloading equipment, main- auxiliary engine, thruster, DP and cranes and other equipment. Assumed physical lifetime for all categories are 30 years, while estimated useful life is 20 years.

Estimation of residual value are based on marked values/ brokers values in the beginning of the year.

The brokers values, sales related expenses deducted, are multiplied with a factor dependent on the vessels age. The factor is 50% for a newbuild, increasing to 100% for a 20 year old vessel.

Periodic maintenance is depreciated over the period until the next planned docking takes place. The normal interval for docking is 24-36 months.

The depreciation rate for other equipment is 15-25%.

Vessels with a book value of 13 466 million are held as a guarantee for the Group's loans, see note 11.

Included in these additions is capitalized interest of NOK 7.2 million (NOK 3.9 million). The applied interest rate is 3.97%.

Impairment valuation of fixed assets

Once a quarter the Group evaluate any issues that might indicate impairment of fixed assets. Throughout 2015 the Group's stock value has been lower than the book value of equity. Broker valuations of the offshore fleet have shown a downward curve during the year. In addition the market for offshore vessels have been weak, without any indication for improvement in the short term. Due to the market situation the Group has laid-up several vessels during the year. All the above are indicators for impairment.

Impairment testing (value in use calculation) was performed in the second and fourth quarter. For all vessels where book value exceeds 65% av broker value, where broker value is set as an average of 3 acknowledged, independent brokers, value in use calculations has been prepared to evaluate the value of the asset. Each vessel is considered a separate cash generating unit. The value in use caclulations are, amongst others, based on the Groups approved budgets for 2016 and forecasts for 2017-2019.

The main assumptions used in the computations are charter rates, escalation of expenses, operational area, interest rate and the market as general.

Discounting rate

The discounting rate is based on a weighted average cost of capital (WACC) for the Group. The cost of equity is derived from the 10-year interest rate for state bonds (risk-free interest rate), the Groups own market risk premium and an average beta for the industry (5-year average). The debt element of the discounting rate is based on the risk-free interest rate, plus the Group's average margin for secured debt, as well as a premium equivalent to the difference between risk-free interest rate and the bank's lending rates. The dicounting rate for 2015 is 7,6%, which is an increase from 7,2% in 2014.

Revenue assumptions

For vessels having firm contracts, revenue is based on the current contracts. For vessels without firm contracts, and for vessels where the firm contract expires during the period, revenue is based on historical data. Both the vessels own hiistory and average rates for comparable vessel for the last 7-10 years have been used. Number of sailing days per year is reduced by 3%. For the first period day rates for the PSV segment is set down to, and for some cases below, operational cost. The same applies to smaller anchorhandling vessels. From 2019 it is assumed a gradual increase of revenue to a level which correspond to the average rates for the past 7-10 years (2021).

Inflation

Escalation of revenue is expected to be marginal for the first coming years. Hence, it is used a low (<1%) or no inflation of revenue in the calculations for the first 2-3 years. Operating cost is adjusted for inflation by 2% to 2018, and 3% thereafter. Inflation of revenue correspond to cost from 2019.

Residual values

Estimated residual values used in the value in use calculations are set using the same principle as for the ordinary derecations. Initially the value is set to 50% of cost price, expected cost of sale deducted, and adjusted according to changes in broker valuations. The assumption is that the broker values decline by 2,5% per year, until the vessel is 20 years old. It is assumed that the vessels av sold after 20 years in operation.

Impairment testing

Based on the impairment test in the second quarter 4 vessel, 3 PSV's and one AHTS, was written down by NOK 125 million. In the fourth quarter an additional 22 vessels were written down by NOK 1,221 million. Total impairment of the Groups's vessel in 2015 was NOK 1,346 million. The impairment was divided on segments as follows: PSV NOK 702 million, AHTS NOK 564 million and CSV NOK 80 million.

Sensitivity calculations

The sensitivity of the value in use calculations for the vessels are analysed by altering the key assumptions; discounting rate, cost escalation, utilisation and day rates. An increase of discounting rate by 1% point and 2% points would have resulted in an additional impairment of NOK 300-600 million. If the dayrates or utilisation are adjusted down decreasing the revenue by 2-5%, the write-down

NEW BUILD CONTRACTS

As at 31.12.2015 the following ships are under construction:

			Solstad	Contract	Paid	Remaining	Due Date
New build contracts	Delivery	Owner	Share	Price	Instalments	31.12.2015	2016
NB "830" TBN Normand Maximus	July 2016	Solstad Rederi AS	100 %	USD 367.200	USD 36.720	USD 330.480	USD 330.480

As at 31.12.2013 the following ships are under construction:

			Solstad	Contract	Paid	Remaining	Due Date
New build contracts	Delivery	Owner	Share	Price	Instalments	31.12.2014	2015
NB "830" TBN Normand Maximus	July 2016	Solstad Rederi AS	100 %	USD 367.200	USD 27.540	USD 339.660	USD 339.660

The company has the option to change some of the equipment on the vessels and therefore there may be some variation in the prices above. Vessel under construction at year end is fully financed.

Asset held for sale

Two of the Group's vessels are agreed sold by the end of 2015. Total sales proceed is NOK 24 million. The corresponding assets are presented as held for sale on the balance sheet as per 31.12.2015. Both vessels are included in the AHTS-segment. Vessels was delivered to new owners in January 2016. Total gain was NOK 1 million.

NOTE 9 SHARES IN JOINT VENTURES, ASSOCIATED COMPANIES AND OTHER INVESTMENTS

The Group has the following shares in joint ventures (FKV) and associated companies (TS):

		Place of	Owner-	Date of Financial
		Business	ship	statement
Deep Well AS (DWAS)	TS	Karmøy	28 %	31-12-15
Solstad Offshore Crewing Services Philippines (SOCS)	TS	Manilla, Philippines	25 %	31-12-15
Normand Installer SA (NISA)	FKV	Marly, Sveits	50 %	31-12-15
PT Meratus Solstad Offshore (PTSO)	FKV	Jakarta, Indonesia	49 %	31-12-15
Normand Oceanic AS (NOCE)	FKV	Karmøy	50 %	31-12-15
Normand Oceanic Chartering AS (NOCH)	FKV	Karmøy	50 %	31-12-15

Normand Oceanic AS owns one construction service vessel. The vesel is hired on bare-boat to a related party. Normand Oceanic Chartering AS hire one contruction service vessel on bareboat from a related party. The vessel is then hired to a third party. Normand Installer SA owns one contruction service vessel hired on time charter to a company associated with the other part of the joint venture.

Solstad Offshore Crewing Services Philippines deliver crewing services to the Group. All the above investments are strategic for the Group.

Deep Well AS performs well intervention services.

PT Meratus Offshore was incorporated for a future estabishment of business in Indonesia.

Joint ventures			2015
	NISA	NOCE	NOCH	PTSO	Sum
Cost price 01.01.	1 631	173 808	23	1 364	176 826
Acc result and adjustments	90 739	33 810	2 357	-1 364	125 542
Book value 01.01.	92 370	207 618	2 380		302 368
Share of result	25 235	39 474	1 169	-	65 878
Other adjustments	2 074	-25 097	-1 191		-24 214
Book value 31.12.	119 678	221 995	2 359		344 032
Balance sheet:
Bank deposits and cash equivalents	84 045	23 039	11 610	819	119 514
Current assets	81 176	16 172	16 688	2 101	116 138
Long-term assets	803 847	1 664 322		1 062	2 469 232
Financial liabilities
Short-term liablilities	-96 689	-16 983	-24 149	139	-137 681
Long-term financial liabilities
Other long-term liabilities	-482 409	-1 050 583		-5 862	-1 538 855
Net assets	389 971	635 967	4 150	-1 740	1 028 348
Share of balance sheet:	194 985	317 984	2 075	-853	514 174
Revenues and profit:
Revenues	152 873	175 850	78 050	44	406 817
Operating expense	-79 080	-532	-74 010	-1 097	-154 720
Depreciations	-3 674	-46 657			-50 330
Interest income			9		9
Interest expense	-19 650	-36 767	-7		-56 423
Financial expense		-12 947	-647	1 055	-12 538
Result before tax	50 470	78 949	3 395	1	132 814
Taxes			-1 056	-1	-1 057
Result	50 470	78 949	2 339	-	131 757
Share of revenues and profit:	25 235	39 474	1 169	-	65 878

Joint ventures			2014
	NISA	NOCE	NOCH	PTSO	Sum
Cost price 01.01.	1 631	173 808	23	1 364	176 826
Acc result and adjustments	53 416	39 977	1 404	-1 059	93 738
Book value 01.01.	55 047	213 785	1 427	305	270 564
Share of result	31 984	31 215	953	-373	63 779
Other adjustments	5 338	-37 382		68	-31 976
Book value 31.12.	92 370	207 618	2 380		302 368
Balance sheet:
Bank deposits and cash equivalents	89 167	20 403	16 593	1 733	127 896
Current assets	58 793	13 657	25 922	1 713	100 083
Long-term assets	656 522	1 452 117		9 003	2 117 642
Financial liabilities
Short-term liablilities	-77 746	-14 874	-36 688	-1 669	-130 977
Long-term financial liabilities
Other long-term liabilities	-443 759	-961 949		-11 362	-1 417 069
Net assets	282 978	509 353	5 827	-582	797 575
Share of balance sheet:	141 489	254 676	2 913	-285	398 788
Revenues and profit:
Revenues	181 439	137 673	77 366	213	396 692
Operating expense	-93 713	-167	-74 338	-397	-168 615
Depreciations	-5 343	-34 402			-39 745
Interest income			14		14
Interest expense	-16 974	-31 027	-9		-48 010
Financial expense	-1 441	-9 648	-179	-570	-11 837
Result before tax	63 969	62 429	2 855	-754	128 499
Taxes			-949	-6	-955
Result	63 969	62 429	1 906	-761	127 544
Share of revenues and profit:	31 984	31 215	953	-373	63 779

Associated companies				2015
			DWAS	SOCS	Sum
Cost price 01.01.			19 367		19 367
Acc result and adjustments			23 956		23 956
Book value 01.01.			43 323		43 323
Share of result			-2 150	1 064	-1 087
Other adjustments				66	66
Book value 31.12.			41 173	1 130	42 302
Share of balance sheet:
Current assets			20 453	7 597	28 050
Long-term assets			73 282	370	73 652
Short-term liablilities			-18 597	-7 201	-25 798
Long-term liabilities			-20 063		-20 063
Net assets			55 074	765	55 840
Share of revenues and profit:
Revenues			55 690	2 970	58 659
Operating expense			-58 428	-1 956	-60 384
Financial expense			588	129	717
Adjustment equity share method				66	66
Result before tax			-2 150	1 208	-942
Taxes				-79	-79
Result			-2 150	1 130	-1 021
Associated companies				2014
	OSOP (*)	OSAS (*)	DWAS	SOCS	Sum
Cost price 01.01.	89	9 911	19 367		29 367
Acc result and adjustments	-9	-26	9 635		9 600
Book value 01.01.	80	9 886	29 001		38 967
Share of result			1 271	594	1 865
Other adjustments	-80	-9 886	13 051	-594	2 491
Book value 31.12.			43 323		43 323
Share of balance sheet:
Current assets			49 587	4 887	54 474
Long-term assets			50 359	420	50 778
Short-term liablilities			-12 704	-5 569	-18 273
Long-term liabilities			-29 487	-30	-29 517
Net assets			57 754	-292	57 462
Share of revenues and profit:
Revenues			61 931	2 059	63 990
Operating expense			-58 224	-1 480	-59 705
Financial expense			-1 966	16	-1 950
Adjustment equity share method				-989	-989
Result before tax			1 741	-394	1 346
Taxes			-470		-470
Result			1 271	-394	876

(*) Ownership increased to 100% in 2014.

Investments available for sale - long term

		2015		2014
		Book		Book
Unlisted shares	Share	value	Share	value
Bleivik SIM Holding AS	29,54 %	2 991	29,54 %	2 991
		2 991		2 991

Based on, amongst others, lack of board representatives, the Group does not have significant influence on the above mentioned companies.

Investments available for sale - current		2015			2014
			Book			Book
Listed shares	Cost price	Share	value	Cost price	Share	value
Rem Offshore ASA	429	0,04 %	229	429	0,04 %	382
			229			382

Investments available for sale are shares which have no fixed maturity or return. Shares in listed companies are valued at fair value at year end. Fair value of shares in unlisted companies is based on the companies' latest financial report.

Net change in value on available for sale financial assets booked to equity through Other comprehensive income:

	2015	2014
Opening balance	-47	46
Change in value of Rem Offshore shares	-153	-93
Ending balance	-200	-47

Subsidiaries with significant minority interests

The Group has two subsidiaries with significant minority interests (MI). Information regarding these is as follows:

Name	Country	Minority interest	Result allocated to MI	Accumulated MI	Paid dividend
2015
Solstad Cable UK Ltd	Scotland	37,5 %	21 133	112 990	0
Trym Titan AS	Norway	37,5 %	-42 111	-167 670	0

2014
Solstad Cable UK Ltd	Scotland	37,5 %	12 386	91 857	0
Trym Titan AS	Norway	37,5 %	-56 759	-125 559	0

Solstad Cable UK Ltd			Trym Titan AS
2014	2013	2014	2013
284 760	262 568	937 703	938 059
74 415	68 515	103 165	84 788
359 175	331 083	1 040 868	1 022 847

0	0	1 478 133	1 345 422
57 868	86 132	9 856	10 996
57 868	86 132	1 487 989	1 356 418

269 602	206 819	123 792	92 637
56 355	33 028	-112 296	-151 358

NOTE 10 INSURANCE SETTLEMENTS

In cases of damages to vessels and equipment, the Group pays for the repairs in advance. After payment of insurance excesses the Group has received the following compensation from its insurance companies:

	2015	2014
Received compensation	67 811	16 032

Advance payments are included in Other operating expenses.

During the last two years the Group has posted Loss of Hire-revenues of NOK 67 million and NOK 29 million respectively.

NOTE 11 MORTGAGE DEBT AND OTHER LONG-TERM LIABILITIES

	2015	2014
Mortgages	8 905 838	10 094 844
Total long-term debt	8 905 838	10 094 844

Short-term portion of long-term debt (1st year instalment)	2 520 002	1 122 371

For maturity profile, please refer to Note 3.

Book value of assets

	2015	2014
Account receivables	635 073	756 794
Vessels	13 465 530	14 244 170
Total booked value	14 100 603	15 000 963

Some vessels are placed as security for the mortgages. In addition, accounts receivables are tied.

The Group's long-term debt was apportioned 43% NOK, 45% USD and 12% GBP at 31.12.2014. The long term debt in NOK is partly linked to the USD through financial instruments. Actual apportionment is 40% USD, 48% NOK and 12% GBP.

The loan agreements are subject to the owner's working capital being positive at all times and that the market value of the vessels amounts to at least 110-135% of the outstanding loans, and that Group's booked equity shall exceed NOK 1.5 billion and NOK 1 billion for Solstad Rederi AS. The first year's loan instalments are exempt from calculation of working capital.

The company satisfies all conditions of the loan agreements at 31.12.15. In addition to the tied assets/negative security clauses the agreements include re-assignment of factoring agreements and insurance terms.

Borrowing cost	2015	2014
Capitalized borrowing cost	68 655	68 649

Borrowing cost is presented net with the loans and is amortizised until maturity of the loan.

Operational lease

Some of the Group's ships are rented out on long-term charter parties. Revenue from these vessels is posted as operational leases.

	31.12.15			31.12.14
	Minimum	Present value		Present value
	payment	minimum payment	payment	minimum payment
Next year	2 793 200	2 725 073	2 746 383	2 679 398
Next 2-5 years	8 369 800	7 703 453	7 920 421	7 278 618
Over 5 years	4 732 600	3 899 451	5 530 918	4 475 376
Finance cost		1 567 622		1 764 331
Total minimum lease payment	15 895 600	15 895 600	16 197 722	16 197 722

Other lease agreements:
The Group has entered the following lease agreements:	Yearly payment	Maturity	Extension	Adjustment of rent
Offices Skudeneshavn	6 276	2026	4 times 5 years	Consumer price
				and 5 years swap-rate
Workshop Husøy, Karmøy	2 636	2016		Consumer price
Offices Aberdeen	654	2018		Fixed for
				the next 2 years
Offices Singapore	2 693	2017	5 years	Fixed for
				the next 2 years
Offices Perth	740	2017	1 year	Consumer price
Offices Rio de Janeiro and Macae	977	2018		Consumer price

Future minimum payments of lease agreements:
During the next year	13 976
In next 2-5 years	31 797
Beyond 5 years	31 380
Total minimum lease payments	77 153

Other long-term liabilities

Other long-term loans of NOK 198 million (NOK 175 million in 2014) are loans from minority shareholders to two of the group's subsidiaries.

Solstad Offshore ASA has furnished the following guarantees (NOK million):

Solstad Offshore UK Ltd	319 - for purchase of vessels
Solstad Offshore Service Vessel UK Ltd	418 - for purchase of vessels
Trym Titan AS	343 - for purchase of vessels
Solstad Offshore Asia Pacific Ltd	1702 - for bare-boat rental and purchase of vessels
Normand Installer SA	65 - for financial lease of vessels
Deep Well AS	52 - for financial lease of fixed assets
Normand Oceanic AS	536 - for purchase of vessels
Normand Vision AS	1487 - for purchase of vessels

NOTE 12 TAXES

	2015	2014
Taxes payable	10 660	12 484
Under/over accrual of tax payable	5 118	14 353
Change in deferred taxes	8 317	4 519
Tax on ordinary result	24 996	31 355
Apportionment of tax on ordinary result
Norwegian tax - ordinary	13 525	4 519
Foreign	10 570	26 837
Total tax	24 996	31 355
Outside Shipping Tax Regime
Temporary differences:
Shares/ownership (current assets)	-1 693	-1 466
Over funding of pension	-50 672	-98 781
Fixed assets/ provisions	-70 179	-101 456
Unrecovered loss carried forward	-119 469	-140 065
Total temporary differences	-242 014	-341 769
Tax effect of temporary differences:
Shares/ownership (current assets)	-423	-396
Pension over funding	-12 668	-26 671
Fixed assets/provisions	-17 545	-27 393
Unrecovered loss carried forward	-29 867	-37 818
Deferred tax asset not recognised	22 517	30 312
Net deferred tax/ deferred tax asset (-)	-37 987	-61 966
Changes in deferred tax in the balance sheet
Opening balance deferred tax	-61 966	-58 934
Booked to profit and loss	8 317	4 519
Business combinations		-133
Charged to equity (change pension)	15 650	-7 429
Translation adjustment	12	12
End balance deferred tax/ deferred tax asset (-)	-37 987	-61 966
Payable tax in the balance sheet consist of
Tonnage tax	171	152
Other payable corporation tax	58 102	40 545
Total payable tax in the balance sheet	58 273	40 697
Tonnage tax is classified as operational expense.
Analysis of effective tax rate
27% of pre-tax result	-426 380	39 071
Effect of deferred tax asset not recognised	22 517	30 312
Differential in tax rates foreign entities	2 860	6 895
Permanent differences/ Shipping Tax Regime	425 999	-44 923
Estimated tax	24 996	31 355

The Group's tonnage taxed companies has no firm plans to exit the new tonnage tax regime.

Deferred tax on deviating values in associated companies with foreign partnerships has been included in the Group accounts. Further, deferred tax is calculated on scenarios where a future realization will lead to a tax liability.

Deferred tax assets from losses carried forward are recognized under the assumption that companies under the ordinary tax regime will have taxable income in the future. This taxable income is related to ordinary income, gain from sale of fixed assets and taxable financial income.

Deferred tax asset is based on a tax rate of 25%.

The Group has an international business. The taxable treatment of transactions, operations and structures in foreign countries may be challenged by local tax authorities, and may result in future tax obligations. Contingent liabilities are recognized in the accounts if they are more likely than not to occur. At the end of the year there are no issues that may lead to taxes in foreign countries for which no specific provision has been booked.

The accounts reflect the Groups best estimate for contingent liabilities at the end of the year.

NOTE 13 SHARE CAPITAL, SHAREHOLDERS AND TREASURY SHARES

	Share	Treasury
	capital	shares
31-12-13	77 375	-484
Purchase treasury shares (267,828)		-536
Sale treasury shares (20,100)		40
31-12-14	77 375	-979

31-12-14	77 375	-979
Purchase treasury shares (0)
Sale treasury shares (64,675)		129
31-12-15	77 375	-850

At 31.12.15, the Company's share capital represents 38,687,377 shares at NOK 2. The number of shareholders at 31.12.15 was 3,082. The Board have the power of attorney to implement a capital appreciation of up to 140,000 shares at NOK 2 for employees of the Group. Furthermore, the Board has power of attorney to increase the share capital by NOK 4 million by issuing 2 million shares. The Board also have the power of attorney to acquire treasury shares limited to 10% of share capital. This power of attorney is retained until the next General Meeting.

As at 31.12.2015 the Group had 424,675 treasury shares with cost price of NOK 45 million As at 31.12.2014 the Group had 489,650 treasury shares with cost price of NOK 52 million

NOTE 14 EARNINGS PER SHARE

Earnings per share are calculated by dividing the Group result by the average number of shares, adjusted for the stock of treasury shares. There are no instruments that allow the possibility of dilution.

	2015	2014
Majority result from net profit for the year	-1 581 108	151 652

Average number of shares	38 631 841	38 935 105
Treasury shares	424 975	489 650
Average number of shares to calculate earnings per share	38 206 866	38 445 455

Earnings per share (NOK)	-41,38	3,94

NOTE 15 TRANSACTIONS WITH RELATED PARTIES

The Group accounts consists of the financial statements of Solstad Offshore ASA and the following subsidiaries, and line-by-line consolidated accounts from joint ventures and associated companies booked as equity investments:

			Solstad Offshore ASA share ownership
Name:	Land:	2015	2014
Solstad Offshore (UK) LTD	UK	100 %	100 %
Solstad Cable (UK) LTD	UK	63 %	63 %
Solstad Offshore Service Vessel (UK) LTD	UK	100 %	100 %
Pioneer Offshore LP	UK	100 %	100 %
Progress Offshore LP	UK	100 %	100 %
Pioneer Offshore Ltd	UK	100 %	100 %
Progress Offshore Ltd	UK	100 %	100 %
PIOPRO (UK) Ltd	UK	100 %	100 %
Solstad Cable Cutter Ltd	UK	63 %	63 %
Solstad Cable Clipper Ltd	UK	63 %	63 %
ADSI Offshore (UK) Ltd	UK	100 %	100 %
Solstad Management AS	Norway	100 %	100 %
Normand Drift AS	Norway	100 %	100 %
Solstad Rederi AS	Norway	100 %	100 %
Trym Titan AS	Norway	63 %	63 %
Solstad Shipping AS	Norway	100 %	100 %
Normand Skarven AS	Norway	100 %	100 %
Normand Skarven KS	Norway	69 %	69 %
Solstad Brasil AS	Norway	100 %	100 %
Normand Flower AS	Norway	100 %	100 %
Solstad Operations AS	Norway	100 %	100 %
Deep Well AS	Norway	28 %	28 %
Solstad Offshore Asia Pacific Ltd	Singapore	100 %	100 %
Nor Asia Pte Ltd (merged)	Singapore	0 %	100 %
Nor Offshore Labuan Pte Ltd	Labuan	100 %	100 %
Solstad Offshore Singapore Pte Ltd	Singapore	100 %	100 %
Nor Supporter Pte Ltd (merged)	Singapore	0 %	100 %
Norce Offshore Pte Ltd	Singapore	100 %	100 %
Norce Offshore Pty Ltd	Australia	100 %	100 %
Norce Offshore Thailand Ltd	Thailand	100 %	100 %
Solstad Offshore Ltda	Brazil	100 %	100 %
Solstad Servicos Maritimos Ltda	Brazil	100 %	100 %
NISA INC (JV)	Switzerland	50 %	50 %
Normand Oceanic AS (JV)	Norway	50 %	50 %
Normand Oceanic Chartering AS (JV)	Norway	50 %	50 %
Normand Vision AS	Norway	100 %	100 %
Normand Vision Chartering AS	Norway	100 %	100 %
Solstad Offshore Crewing Services Pte	Singapore	100 %	100 %
Solstad Offshore Crewing Services Philippines	Philippines	25 %	25 %
PT Meratus Solstad Offshore	Indonesia	49 %	49 %

Solstad Offshore UK LTD is the parent company of Solstad Cable (UK) LTD, Solstad Offshore Service Vessel (UK) LTD, ADSI Offshore (UK) Ltd, and PIOPRO (UK) Ltd. Solstad Cable (UK) Ltd is the parent company of Solstad Cable Cutter, Ltd, Solstad Cable Clipper Ltd and Solstad Cable Holland BV.

Solstad Offshore Service Vessel (UK) Ltd is the parent company of Pioneer Offshore LP and Progress Offshore LP, whilst PIOPRO (UK) Ltd is the parent company of Pioneer Offshore Ltd and Progress Offshore Ltd. Solstad Rederi AS is the parent company of Normand Flower AS.

Solstad Brasil AS is the parent company of Solstad Offshore Ltda. Solstad Offshore Asia Pacific Ltd is the parent company of Nor Asia Pte Ltd, Nor Offshore Labuan Pte Ltd, Nor Supply Pte Ltd, Nor Supporter Pte Ltd, Norce Offshore Pte Ltd. and Solstad Offshore Crewing Services Pte.

Norce Offshore Pte Ltd is the parent company of Norce Offshore Pty Ltd and Norce Offshore Thailand Ltd.

Solstad Offshore Ltda is the parent company to Solstad Servicos Maritimos Ltda.

Solstad Offshore ASA is the parent company for the remaining companies, and also has ultimate control of all companies.

In addition to general management services, the Group has entered the following transactions with associated parties:

		Income		Expenses		Receivables	Payables
Associated company	2015	2014	2015	2014	2015	2014	2015	2014
Deep Well AS	431					6 835
Solstad Offshore Crewing Services Philippines					925	11 875

Joint venture companies
NISA					13 927	11 501
Normand Oceanic AS	4 139	3 781			4 139	3 781

Other related parties
Owner of offices		113	8 762	5 883		40
Owner of workshop			709	516				3

The Group's affiliation with associated parties:

Deep Well AS is an associated company in which the Group has a 28% share. Receivables are subordinated loans and guarantee commission. Solstad Offshore Crewing Services Philippines is a company in which the Group has a 25% share. Receivable relates to a shareholders loan. NISA is a joint venture company in which the Group has a 50% share. Receivable relates to a shareholders loan. Normand Oceanic AS is a joint venture company in which the Group has a 50% share. Revenue and recievables relates to guarantee commission. The Group rents offices and a warehouse at market price from a company controlled 100% by the main shareholder. The Group also uses a shipyard for repairs and conversions of the Group's vessels where the main shareholder controls 100%. Associated parties are considered to be Board Members (including associated companies) and the company management. There are no management agreements with associated parties outside the Group that charge management fees. Transactions with related parties are completed at normal market prices. Interest is not calculated on outstanding balances at year end that are normal accounts receivable or accounts payable. Current assets are included in the ordinary evaluation of bad debt.

NOTE 16 BANK DEPOSITS

The Group's tied deposits total NOK 24 million (NOK 32.6 million) on which tax is withheld.

NOTE 17 ENVIRONMENTAL CONDITIONS

All of the company's vessels comply with current environmental requirements. In 2015, none of the company's vessels had conditions imposed on them for upgrading or improving technical equipment or any other measures necessary to satisfy current environmental standards.

The company's HSE and ISPS system complies with international regulations (IMO's International Safety Management Code). All vessels and our administration hold ISM certification from Det Norske Veritas or relevant Flag State. The company's Quality Assurance system is certified in accordance to NS-EN ISO 9001:2000.

NOTE 18 PAID OUT AND PROPOSED DIVIDEND

Approved and paid out during the year:	2015	2014	2013
Ordinary dividend	135 406	193 437	96 718

Proposed dividend at general meeting:	2015	2014	2013

Ordinary dividend		135 406	193 437

NOTE 19 OTHER LONG-TERM ASSETS

	2015	2014
Sellers credit	79	28 766
Loan to other companies	1 840	2 143
Other receivables	25	25
Total other long-term assets	1 945	30 935

The loans are secured convertible loans. Interest rate during 2015 has been 6,7%.

NOTE 20 ACCOUNTS RECEIVABLE AND OTHER SHORT-TERM RECEIVABLES

	2015	2014
Accounts receivable	612 970	756 772
Receivable from associated and joint venture companies	22 103	22
Total accounts receivable	635 073	756 794

Prepaid expenses	8 119	10 688
VAT raceivable	3 531	4 720
Other short-term receivables	262 746	291 993
Receivable from associated and joint venture companies	8 408	50 259
Total short-term receivables	282 804	357 660

Other short-term receivables are mainly refundable insurance claims, accrued revenue and prepaid docking expenses.

NOTE 21 STOCK

Stock consists of provisions, bunkers and lube oil on the Group's vessels:

	2015	2014
Bunkers	36 109	29 425
Lube oil	14 782	16 444
Provisions	6 135	8 540
Other		6 779
Total stock	57 026	61 188

NOTE 22 OTHER CURRENT LIABILITIES

Other current liabilities consist mainly of accrued interests and provision for planned periodic maintenance at year end.

NOTE 23 SUBSEQUENT EVENTS

After the end of the year the bond loan SOFF03, amouting to NOK 700 million (ref note 3), has been repaid and replaced by an ordinary NOK 500 million mortgage loan. The Group is working on a possible sale-lease-back for the newbuild Normand Maximus (ref note 8), with delivery in July 2016.

CORPORATE ACCOUNTS FOR SOLSTAD OFFSHORE ASA (PARENT COMPANY)

PROFIT & LOSS ACCOUNT 1.1 - 31.12

PARENT COMPANY		(NOK 1.000)
	Noter	2015	2014

Other operating income		2 007	2 091
Total operating income		2 007	2 091

Personnel costs	4	-6 728	-7 134
Other operating expenses	4	-13 519	-14 807
Total operating costs		-20 247	-21 941

Operating loss		-18 240	-19 850

Interest income from companies in the Group		25 958	38 105
Other interest income		1 294	11 353
Other financial income	5	358 461	413 971
Interest costs from companies in the Group		-181	-686
Other interest charges		-96 221	-122 759
Other financial charges	5,7	-104 293	-84 061
Net financing		185 018	255 922

Ordinary profit before taxes		166 778	236 072
Tax on ordinary result	10	-6 863	-1 886
Net profit for year		159 915	234 186


Transfers and disposable income
Dividends	11		135 406
Transfer from other equity	11	159 915	98 780
Total transfers and disposable income		159 915	234 186

BALANCE SHEET

PARENT COMPANY	(NOK 1 000)
	Noter	31.12.2015	31.12.2014
ASSETS

Fixed Assets

Intangible fixed assets
Deferred tax asset	10	694	7 557

Financial fixed assets
Investments in subsidiaries	6	4 026 534	4 115 032
Loan to companies in the Group	9	832 252	664 756
Investment in jointly-owned companies	7	198 870	198 870
Investment in associated companies	7	32 418	32 418
Other long-term receivables	8	13 927	18 336
Total financial fixed assets		5 104 001	5 029 411

Total fixed assets		5 104 694	5 036 968

Current assets

Receivables
Other short-term receivables	9	58 997	77 417
Total receivables		58 997	77 417

Bank deposits and cash equivalents		90 225	31 594
Total current assets		149 222	109 011

TOTAL ASSETS		5 253 916	5 145 979

BALANCE SHEET

PARENT COMPANY	(NOK 1 000)
	Noter	31.12.2015	31.12.2014
EQUITY AND LIABILITIES
Equity
Restricted equity
Share capital (37.794.160 at NOK 2.00)		77 375	77 375
Treasury shares		-850	-979
Share premium		112 367	112 367
Other paid-in capital		111 648	111 648
Total restricted equity	11	300 540	300 410

Earned equity
Other equity	11	3 016 798	2 854 037
Total earned equity		3 016 798	2 854 037

Total equity	11,12	3 317 338	3 154 447

Liabilities
Provisions
Other provisions	16	21 018	21 018
Total provisions		21 018	21 018

Other long-term liabilities
Debt Group companies	9	128 613
Bond Loan	17	1 696 170	1 693 190
Total long-term liabilities		1 824 783	1 693 190

Current liabilities
Accounts payable	9	2 456	9 597
Bank overdraft	15	82 656	121 908
Dividends	11		135 406
Group contribution			4 839
Other current liabilities		5 666	5 575
Total current liabilities		90 778	277 324
Total liabilities		1 936 578	1 991 532

TOTAL EQUITY AND LIABILITIES		5 253 916	5 145 979

Guarantees etc.	14

Skudeneshavn, April 18, 2016

Terje Vareberg Chairman

Ketil Lenning Director

Toril Eidesvik Director

Anette Solstad Director

Lars Peder Solstad Managing Director

Anders Onarheim Director

STATEMENT OF CASH FLOW 1.1 - 31.12

PARENT COMPANY		(NOK 1 000)
		2015	2014

CASH FLOW FROM OPERATIONS

Profit/loss before taxes		166 778	236 072

Write-down of financial assets		88 667	63 500
Unrealised currency gain/loss		69 500	57 799
Change in short-term receivables/payables		-7 141	-3 036
Change in other accruals		13 672	-63 342
Net cash flow from operations	(A)	331 476	290 993

CASH FLOW FROM INVESTMENTS
Investments in shares		-169	-472 192
Payment of long-term receivables		-249 918	42 043
Disposal of shares			201
Net cash flow from investments	(B)	-250 087	-429 948

CASH FLOW FROM FINANCING
Payment of dividends		-133 692	-191 511
Purchase and sale of treasury shares		1 263	-24 725
Bank overdraft		-21 922	49 956
New/ repayment of (-) long-term debt		131 593	274 905
Net cash flow from financing	(C)	-22 759	108 625

Net change in cash and cash equivalents	(A+B+C)	58 631	-30 330
Cash and cash equivalents at 01.01		31 594	61 924
Cash and cash equivalents at 31.12	(Note 15)	90 225	31 594

NOTE 1 ACCOUNTING PRINCIPLES

General

The annual accounts have been prepared in accordance with the Accounting Act and best practice accounting principles in Norway. The most important accounting principles are described below.

Use of estimates

In the preparation of the accounts, estimates and assumptions are used which affect the accounts. Actual figures may differ slightly from the estimates.

Foreign Currency

Monetary items in foreign currency are converted at the exchange rate at the balance sheet date.

The following exchange rates have been used in the accounts:

	GBP	USD	Euro
Per 31.12.14	11,571	7,4332	9,0365
Per 31.12.15	13,072	8,8090	9,6190

Cost of borrowing

The cost of borrowing is capitalized at the time of borrowing and the cost is charged over the maturity period of the loan.

Evaluation and presentation of current assets

Stocks are valued as the lowest of either the acquisition or the estimated sales value.

Receivables are posted at face value with deduction for anticipated loss.

Financial fixed assets

Long-term investment in shares and other investments are valued at the lowest of either the acquisition cost or the estimated sales value if the reduction in the sales value is not considered temporary.

Taxes / Deferred Tax

Deferred tax/ deferred tax assets are calculated, using the liability method, at 25% based on temporary differences between the accounting and tax-related values existing at the end of the financial year and any tax deficits are carried forward.

Temporary tax increases and decreases are recorded in the balance sheet as net figures.

Classification of items in the accounts

Assets determined for long-term ownership or use and receivables which are due more than one year after the expiry of the financial year are posted as fixed assets. Any remaining assets are classified as current assets.

Liability which is due more than one year after the expiry of the financial year is posted as long-term debt.

Contingencies

Contingent losses that are probable and quantifiable are posted to the accounts, whilst contingent gain/income is not.

Shares and holdings in other companies

Short-term investments related to shares are not treated as a trading portfolio and are valued at the lowest of cost price and market value.

Shares in subsidiaries, associated companies and jointlyowned companies

Shares in subsidiaries, associated and jointly-owned companies are posted in the parent company accounts at cost and written down to the extent that there is a significant deficit value which is not considered temporary.

Treasury shares

Treasury shares are posted as a nominal value under the item "share capital". The difference between nominal and acquisition cost is entered as "other equity".

Cash flow

The Group applies the indirect method. Investment in shares and other liquid assets with maturity over three months are not included under cash equivalents.

NOTE 2 MAJOR TRANSACTIONS/EVENTS

The company increased it's ownership in the companies Normand Vision AS and Normand Vision Chartering AS to 100% from 8% and 30%, respectively, in July 2014.

NOTE 3 FINANCIAL RISK

The company is exposed to various financial risks in its activities. Financial risk is the risk incurred from any changes in currency and interest rates together with counter parties ability to pay, and which impacts the value of the company's assets, liabilities and future cash flows.

NOTE 4 OTHER EXPENSES, WAGES, EMPLOYEES AND DISTINCTIVE CONTRIBUTIONS

	2015	2014
Wages	5 095	4 867
Employer's National Insurance	784	801
Pension costs		346
Other benefits	369	267
Travelling costs, courses and other personnel costs	480	853
Total employee costs	6 728	7 134

Average number of employees	2	2

REMUNERATION TO DIRECTORS, MANAGING DIRECTOR AND AUDITORS

Remuneration	Wages	Other benefits	Pension cost
Key employees:
2015
Lars Peder Solstad (man.dir)	2 102	200	75
Sven Stakkestad (dep.man.dir)	1 905	125	163
Eivind Kvilhaug (finance dir.)	1 200	16	60
Hans Knut Skår (chartering dir.)	1 607	123	60
Tor Inge Dale (operation dir.)	1 270	16	58
	8 083	480	415
2014
Lars Peder Solstad (man.dir)	2 225	195	60
Sven Stakkestad (dep.man.dir)	2 016	125	286
	4 241	320	346

Board of Directors:	Director's fee
Terje Vareberg	341
Toril Eidesvik	210
Anders Onarheim	158
Anette Solstad	158
Ketil Lenning	158

In 2015, NOK 614,457 is charged as auditors fees and NOK 360,139 relating to other non-audit related services.

Both amounts are exclusive VAT.

There are no distinctive agreements regarding remuneration for the Chairman of the Board and nor are there any distinctive bonus or or option programmes for any Board Member or Group Management. No loans have been given to key employees.

The Managing Director has an agreement that secures 12 months salary.

The employees are included in the Group's standard pension plan. Pension fund liability is posted in Solstad Management AS.

NOTE 5 FINANCIAL ITEMS

Other financial income, totalling NOK 358 million includes guarantee commission of NOK 42 million, dividends from subsidiaries NOK 200 million, unrealized currency gain of NOK 87 million, income from investments in subsidiaries of NOK 7 million, gain on derivatives NOK 7 million and group contributions of NOK 15 million. Comparative figures for 2014 of NOK 414 million includes guarantee commission of NOK 37 million, dividends from subsidiaries of NOK 250 million, unrealized currency gain of NOK 77 million, income from investments in subsidiaries of NOK 4 million, and and group contributions of NOK 46 million.

Other financial costs of NOK 104 million consist of write-down of shares in subsidiary NOK 89 million and realized currency loss NOK 15 million. Comparative figures for 2014 of NOK 84 consist of write-down of shares in subsidiary NOK 63 million, realized currency loss NOK 14 million and cost relating to termination of a bond loan NOK 7 million.

NOTE 6 SHARES IN SUBSIDIARIES

	Place of	Owner-	Number of		Share	Cost price/
31.12.2015	Business	ship	Shares	Nominal Value	Capital	Book value
Solstad Shipping AS	Skudeneshavn	100 %	10 000	1 000	10 000	33 001
Solstad Mexico AS	Skudeneshavn	100 %	100	USD 200	USD 20	169
Solstad Rederi AS	Skudeneshavn	100 %	71 500	100	7 150	2 428 391
Solstad Operations AS	Skudeneshavn	100 %	30 000	1	30	10 030
Normand Drift AS	Skudeneshavn	100 %	150	1 000	150	150
Solstad Offshore UK Ltd	Aberdeen	100 %	11 000 100	1	GBP 11 000	145 284
Solstad Management AS	Skudeneshavn	100 %	2 000	1 000	2 000	11 000
Normand Skarven AS	Skudeneshavn	100 %	1	950 000	950	1 250
Trym Titan AS	Skudeneshavn	63 %	625	100	100	81 250
Solstad Brasil AS	Skudeneshavn	100 %	480	1 000	480	31 000
Normand Skarven KS	Skudeneshavn	69 %	0	0		25 000
Normand Vision AS	Skudeneshavn	100 %	2 496 031	0	140	234 608
Normand Vision Chartering AS	Skudeneshavn	100 %	5 000	6	30	299
Solstad Offshore Asia Pacific Ltd	Singapore	100 %	20 000 000 000	(*)	USD 175 877	1 025 103
Sum						4 026 534

Place of Owner- Number of Share Cost price/ 31.12.2014 Business ship Shares Nominal Value Capital Book value Solstad Shipping AS Skudeneshavn 100 % 10 000 1 000 10 000 52 480 Solstad Rederi AS Skudeneshavn 100 % 71 500 100 7 150 2 428 391 Solstad Operations AS Skudeneshavn 100 % 30 000 1 30 10 030 Normand Drift AS Skudeneshavn 100 % 150 1 000 150 150 Solstad Offshore UK Ltd Aberdeen 100 % 11 000 100 GBP 1 GBP 11 000 145 284 Solstad Management AS Skudeneshavn 100 % 2 000 GBP 1 000 2 000 14 839 Normand Skarven AS Skudeneshavn 100 % 1 GBP 950 000 950 1 250 Trym Titan AS Skudeneshavn 63 % 625 100 100 81 250 Solstad Brasil AS Skudeneshavn 100 % 480 1 000 480 86 000 Normand Skarven KS Skudeneshavn 69 % 35 350 Normand Vision AS Skudeneshavn 100 % 2 496 031 0 140 234 608 Normand Vision Chartering AS Skudeneshavn 100 % 5 000 6 30 299 Solstad Offshore Asia Pacific Ltd Singapore 100 % 20 000 000 000 (*) USD 175 877 1 025 103 Total 4 115 032

The shares in subsidiaries Solstad Shipping AS, Solstad Management AS, Solstad Brasil AS and Normand Skarven KS are written down by NOK 89 million in 2015. Book values is written down to the company's share of book value of equity, adjusted for eccess values and any currency effects.

NOTE 7 SHARES IN JOINTLY OWNED AND ASSOCIATED COMPANIES

Shares in jointly owned and associated companies

		Place of	Owner-	Number of		Equity	Result
		Business	ship	Shares	Nominal Value	31.12.15 (100%)	2015 (100%)
NISA Inc. (FKV)	Marly (Switzerland)		50 %	501	25 038	69 444	11 434
Normand Oceanic AS (FKV)		Karmøy	50 %	112 134 346	173 808	583 319	78 913
Normand Oceanic Chartering AS (FKV)		Karmøy	50 %	15 000	23	4 150	2 338
Total					198 870	656 912	92 684
Deep Well AS (TS)		Haugesund	28 %	80 153	32 418	199 665	-6 032
Total					32 418	199 665	-6 032

(*) The company is deemed to be an associated company even though owner share is only 8%, based on representation in Board of Directors and future options for shares.

NOTE 8 OTHER LONG TERM ASSETS

Other long term assets include:

	31.12.2015	31.12.2014	Interest
Shareholders loan NISA SA	13 927	11 501	2,16 %
Loan to DeepWell AS		6 835	6% - fast
Activated financial cost	3 830	6 810
Total	17 757	25 146

The loans are convertible subordinated loans.

NOTE 9 INTER COMPANY GROUP

Solstad Offshore ASA had the following receivables/debt from companies in the Group:

	31.12.2015	31.12.2014	Interest
Solstad Cable (UK) Ltd		50 021	1,68 %
Solstad Rederi AS	115 441	108 500	6mnd NIBOR + 4%
Normand Vision AS	60 607	60 746	6 mnd LIBOR + 4%
Trym Titan AS	330 708	219 178	6 mnd LIBOR + 2,5%
Solstad Offshore Asia Pacific Ltd	173 112	103 172	5,00 %
Norce Offshore LTD	152 385	123 139	5,00 %
Inter company loans	832 252	664 756
Solstad Shipping AS	43 676	68 625
Solstad Operations AS	8 309
Normand Drift AS	4 760
Normand Skarven AS		172
Solstad Management AS	2 252	4 839
Other current assets	58 997	73 636
Solstad Offshore UK Ltd	50 074		6 mnd NIBOR + 3,75%
Solstad Offshore UK Ltd	78 538		6 mnd LIBOR + 3,75%
Inter company loans	128 613
Solstad Management AS	-2 456	-9 597
Trade account payable	-2 456	-9 597

Group receivables, due more than one year after expiry of the financial year, are around NOK 832 million.

NOTE 10 TAX	2014	2013
Taxable income
Result before tax	166 778	236 072
Changes in temporary differences	219	434
Permanent differences	91 252	63 579
Share of result in limited partnerships	-5 187	14 801
Dividends/ repayments from limited partnerships	-6 913	-3 456
Dividend received- (participation exemption method)	-199 595	-250 382
3% taxable dividend	789	1 121
Loss sale of shares		-599
Used of loss carry forward	-47 344	-61 570
Taxable income
Change in deferred taxes	6 863	1 886
Tax on ordinary result	6 863	1 886
Shares/ownership (current assets)	296	515
Long term receivables	-2 000	-2 000
Unrecovered loss carried forward	-75 506	-122 850
Total temporary differences	-77 210	-124 335
Calculated deferred tax asset	19 302	33 570
Unrecognized part of deferred tax asset	-18 609	-26 013
Booked deferred tax asset	694	7 557
Analysis of effective tax rate:
27% of Profit before Tax	45 030	63 739
Tax effect of dividends and gain/ loss sale of shares	-56 944	-64 399
Effect of change in tax rate (25% vs 27%)	1 544
Deferred tax asset not recognised	-7 405	-14 620
Tax effect of permanent differences	24 638	17 166
Estimated tax	6 863	1 886

Provisions for deferred tax are posted for accounting position where a future realization will result in payable taxes.

NOTE 11 EQUIT Y, SHAREHOLDERS AND TREASURY SHARES

	Share	Treasury	Share premium	Other paid-in	Other	Total
	Capital	shares	reserve	equity	Equity	Equity
Equity 31.12.2014	77 375	-979	112 367	111 648	2 854 037	3 154 447
Purchase/ sale of treasury shares		129			1 133	1 263
Unallocated dividend on treasury shares					1 714	1 714
Annual result					159 915	159 915
Equity 31.12.2015	77 375	-850	112 367	111 648	3 016 798	3 317 338

Shareholders with more than 1% holding at 31.12.2015:

	Number of shares	Ownership
Soff Holding AS	13 906 506	35,95 %
Pareto Aksje Norge	2 641 907	6,83 %
Ivan II AS	2 358 158	6,10 %
Skagen Vekst	2 052 746	5,31 %
Solstad Invest AS	1 861 604	4,81 %
Momentum Investments INC	1 717 216	4,44 %
Odin Energi	1 084 216	2,80 %
FLPS - Princ All Sec Stock Sub	1 044 000	2,70 %
Espedal & Co AS	668 641	1,73 %
Solhav Invest X AS	563 080	1,46 %
Vindbalen AS	540 375	1,40 %
MP Pensjon PK	535 355	1,38 %
Banque Int. Luxemburg SA	468 487	1,21 %
Pareto AS	445 000	1,15 %
Solstad Offshore ASA	424 975	1,10 %
	30 312 266	78,35 %

Board of Directors and Managing DIrectors share interest in the company

In accordance with the definition in corporation law, the Directors had the following holdings at 31.12.15:

Terje Vareberg	3 000	shares
Toril Eidesvik	0	shares
Anders Onarheim	0	shares
Anette Solstad	56 402	shares
Ketil Lenning	0	shares

The Managing Director Lars Peder Solstad controlled 540.475 shares at 31.12.2015. The Deputy Managing Director Sven Stakkestad owned 3,325 shares at 31.12.2015. The company's auditor does not hold shares in the company.

Pr 31.12.2015 the company has acquired 424,975 treasury shares at a cost price of NOK 44.8 million.

NOTE 12 EARNINGS PER SHARE

In 2015, earnings per share was NOK 4.18. The equivalent value in 2014 was NOK 6.13.

Earnings per share is calculated by dividing the Group result by the average number of shares, adjusted for the stock of treasury shares. There are no instruments that allow the possibility of dilution.

NOTE 13 TRANSACTIONS WITH RELATED PARTIES

Related parties are considered to be Board Members (including associated companies) and the company management. There are no management agreements with related parties outside the Group that charge management fees. Inter-company debt/receivables are interest-bearing.

NOTE 14 GUARANTEES

319 - for purchase of vessels
418 - for purchase of vessels
343 - for purchase of vessels
1702 - for bare-boat rental and purchase of vessels
65 - for financial lease of vessels
52 - for financing of fixed assets
536 - for purchase of vessels
1487 - for purchase of vessels

NOTE 15 ADDITIONAL INFORMATION RELATING TO CASH FLOW

The Group utilizes the indirect method. Investment in stocks and shares with a maturity of more than three months are not included in the cash equivalents. Unused part of line of credit is USD 8 million.

NOTE 16 PROVISIONS

In relation to the increased ownership in Solstad Offshore Asia Pacific Ltd a parent company guarantee was issued for parts of the company's external debt. The guarantee was included in the calculation of the cost price for the new shares. The estimated future guarantee obligation is accounted for as a provision.

NOTE 17 BOND LOAN

The company has issued the following bond loans:	Book value	Book value
	31.12.2015	31.12.2014	Maturity
SOFF03	700 000	700 000	02/2016
SOFF04	1 000 000	1 000 000	02/2019
	1 700 000	1 700 000

There are no installments to be paid prior to maturity. Average interest rate is 5.32%

The NOK 700 million loan (SOFF03) was repaid in February 2016.

THE FLEET PER APRIL 2016

		Built year	HP	DWT	Deck m2	Winch power	Bollard pull	A-frame Cap. t.	Constr. crane t.	DP class	Cabin cap.	Dry bulk	Other equipment
	CSV
1	TBN Normand Maximus	2016	39 600	16 500	2 500				900	3	180
2	Normand Reach	2014	20 944	4 750	1 300				250	3	100
3	Normand Vision	2014	28 200	12 000	2 100				400	3	140
4	Normand Oceanic	2011	26 000	11 300	2 100				400	3	140
5	Normand Pacific	2010	20 560	4 500	1 000				200	3	120
6	Normand Baltic	2010	12 000	4 100	1 000				100	2	69
7	NorCE Endeavor	2011	N.A.	18 000	3 300				1100		280		5
8	Normand Subsea	2009	21 000	6 100	750				150	2	90
9	Nor Australis	2009	5 500	2 500	780				70	2	120		1,4
10	Nor Valiant	2008	5 500	3 100	700				50	2	120		1
11	Normand Seven	2007	26 000	10 000	2 000				250	3	100
12	Normand Installer	2006	31 500	8 600	1 300	500	308	350	250	3	102
13	Normand Commander	2006	10 197	4 305	800				100	2	100
14	Normand Fortress	2006	10 197	4 300	800				140	2	100
15	Normand Flower	2002	10 600	4 500	960				150	3	85		2
16	Normand Mermaid	2002	11 000	4 000	780				100	3	69		2
17	Normand Cutter	2001	22 000	10 000	1 800		120	60	300	2	102
18	Normand Clipper	2001	22 000	10 000	1 800		120	60	250	2	114
19	Normand Pioneer	1999	27 800	5 000	1 000	500	286	150	140	2	75
20	Normand Progress	1999	27 800	5 000	1 000	500	304	250	100	2	70
	LARGE AHTS
21	Normand Ranger	2010	28 000	4 250	750	500	280			2	60	X	1,2,3
22	Normand Prosper	2010	32 000	5 000	800	500	338			2	70
23	Normand Ferking	2007	20 000	5 000	700	500	250			2	32	X	1,2,3
24	Normand Titan	2007	16 092	2 600	510	400	187			2	28	X
25	Normand Master	2003	23 500	3 700	600	500	282	150*		2	52		2
26	Normand Mariner	2002	23 500	3 700	600	500	282	150*		2	52		2
27	Normand Ivan	2002	20 000	4 140	600	500	240	250*		2	52	X	1,2
28	Normand Borg	2000	16 800	2 873	570	500	202			1	35	X	2
29	Normand Atlantic	1997	19 400	4 200	560	500	220			2	50	X	1,2,3
30	Normand Neptun	1996	19 400	4 200	560	500	222			2	40	X	1,2,3
	SMALLER AHTS
31	Nor Chief	2008	10 800	2 100	450	300	140			2	40	X	1
32	Nor Spring	2008	8 000	2 600	500	200	111	50	20	2	60	X	1
33	Nor Captain	2007	10 880	2 300	450	300	143			2	40	X	1
34	Nor Tigerfish	2007	5 500	1 650	475	150	70	50	30	2	60	X	1
35	Nor Star	2005	5 500	1 860	475	150	71			2	42	X	1
	PSV
36	Normand Arctic	2011	10 500	4 900	1 000					2	28	X	2,3
37	Normand Vibran	2008	5 310	3 240	680					2	18	X
38	Normand Corona	2006	8 931	4 100	941					2	24	X
39	Normand Trym	2006	5 310	3 240	680					1	16	X
40	Normand Aurora	2005	10 000	4 900	960					2	25	X
41	Normand Skipper	2005	9 500	6 400	1 220					2	23	X	2,3
42	Normand Flipper	2003	9 000	4 500	960					2	17	X	2
43	Normand Vester	1998	10 300	4 590	956					2	37	X	2,3
44	Normand Carrier	1996	10 300	4 560	956					2	37	X	2,3

Explanation:

1) Firefighting / Fi-Fi 2) Oil resque

3) Standby / Resq

4) Diving system 5) 150 T pipelay system for 48'' pipes

* A-Frame shared

CONTRACT COVERAGE PER APRIL 2016

			2016				2017			2018			2019

	Vessel name	1Q	2Q	3Q	4Q	1Q	2Q	3Q	4Q	1Q	2Q	3Q	4Q	1Q	2Q	3Q	4Q
	CSV
1	TBN Normand Maximus
2	Normand Reach
3	Normand Vision
4	Normand Oceanic
5	Normand Pacific
6	Normand Baltic
7	Norce Endeavour
8	Normand Subsea
9	Nor Australis
10	Nor Valiant
11	Normand Seven
12	Normand Installer
13	Normand Commander		(Lay up)
14	Normand Fortress
15	Normand Flower
16	Normand Mermaid
17	Normand Cutter
18	Normand Clipper
19	Normand Pioneer
20	Normand Progress
	LARGE AHTS
21	Normand Ranger
22	Normand Prosper
23	Normand Ferking
24	Normand Titan
25	Normand Master
26	Normand Mariner	(Lay up)
27	Normand Ivan
28	Normand Borg	(Lay up)
29	Normand Atlantic	(Lay up)
30	Normand Neptun	(Lay up)
	SMALLER AHTS
31	Nor Chief
32	Nor Spring
33	Nor Captain
34	Nor Tigerfish	(Lay up)
35	Nor Star
	PSV
36	Normand Arctic
37	Normand Vibran	(Lay up)
38	Normand Corona	(Lay up)
39	Normand Trym	(Lay up)
40	Normand Aurora
41	Normand Skipper	(Lay up)
42	Normand Flipper
43	Normand Vester	(Lay up)
44	Normand Carrier	(Lay up)

Some of the charterparties include clauses which under certain conditions gives the charter the right to cancel..

HEAD OFFICE:

Nesavegen 39, 4280 Skudeneshavn Postboks 13, 4297 Skudeneshavn, NORWAY Tel: +47 52 85 65 00. Fax: +47 52 85 65 01 Mail: [email protected]

BRANCH OFFICES:

SOLSTAD OFFSHORE (UK) LTD.

3rd. Floor, Salvesen Tower Blaikies Quay, Aberdeen AB 11 5PW, UNITED KINGDOM Tel: +44 1224 560 280. Fax: +44 1224 560 281 Mail: [email protected]

SOLSTAD OFFSHORE LTDA.

Rua Lauro Muller 116, Suite 2401 - Torre do Rio Sul Botafogo, Rio de Janeiro - RJ, 22290-160 BRASIL Tel: +55 21 3544-0040/41. Tel: +55 21 8176-3180 Mail: [email protected]

SOLSTAD OFFSHORE ASIA PACIFIC LTD.

1A International Business Park #06-01, SINGAPORE 609923 Tel: +65 6319 8799. Fax: +65 6319 8783 Mail: [email protected]

SOLSTAD OFFSHORE PTY LTD .

Level 1, Colord House, 33 Colin Street, West Perth, AUSTRALIA 6005 Tel: +61 8 9481 0161

SOLSTAD OFFSHORE CREWING SERVICES PHILIPPINES, INC.

3rd Floor Volvo Building, 2272 Chino Roses Ave., Makati City, Philippines 1232 Tel: +63 2 4641400 Mail: [email protected]

AI assistant

Solstad Offshore ASA — Annual Report 2015

3749_rns_2016-04-18_fedc7e9d-2679-4396-add5-e5abf99799ae.pdf

CONTENT

ANNUAL REPORT

CONSOLIDATED

CORPORATE ACCOUNTS

FINANCIAL CALENDAR 2016

OUR BUSINESS

CORPORATE STRUCTURE

FINANCIAL HIGHLIGHTS

OPERATING INCOME LAST FIVE YEARS (NOK mill)

OPERATING INCOME 2015 QUARTERLY (NOK mill)

KEY FIGURES PER SHARE

REFERENCES:

ANNUAL REPORT

1. BUSINESS, OBJECTIVES AND STRATEGY

2. THE COMPANY'S ACTIVITIES

3. THE OFFSHORE MARKET

4. CORPORATE PARTICULARS

5. CORPORATE GOVERNANCE AND MANAGEMENT

6. FINANCIAL POSITION AND DEVELOPMENT – THE GROUP

7. HEALTH, THE ENVIRONMENT, SAFET Y AND QUALIT Y ASSURANCE

8. EXPECTATIONS FOR 2016

9. FINANCE – PARENT COMPANY

AFFIRMATION BY THE BOARD AND MANAGING DIRECTOR

THE BOARD

ANDERS ONARHEIM (born 1959)

TORIL EIDESVIK (born 1968)

CORPORATE GOVERNANCE

Implementation and reporting

Business

Equity and dividends

Equal treatment of shareholders and transactions with close associates

Freely negotiable shares

General meeting and nomination committee

Board composition and independence

Board work

Risk management and internal control

Remuneration of directors

Remuneration to executive personnel

Information and communications

Take-overs

Auditor

STATEMENT OF COMPREHENSIVE INCOME 1.1 - 31.12

BALANCE SHEETS

BALANCE SHEETS

STATEMENT OF CHANGES IN EQUITY

GROUP (NOK 1.000)

STATEMENT OF CASH FLOW 1.1 - 31.12

NOTE 1 ACCOUNTING PRINCIPLES

Statement of Compliance and basis for preparation

Changes in accounting principles

Approved IFRS and IFRIC interpretations not yet implemented

IFRS 9 Financial Instruments

IFRS 15 Revenue from Contracts with Customers

IFRS 16 Leases

IAS 12 Income taxes (amendment)

IAS 7 Statement of cash flows (amendment)

Consolidation

Investment in associates and joint ventures

Other investments

• Financial assets at fair value through profit and loss

• Held to maturity investments

Financial investments

Classification of items in the balance sheet

Foreign currency translation

Segment information

Property, plant and equipment – write-offs and depreciation

New build contracts

Leases

Trade and other receivables

Cash and cash equivalents

Treasury shares

Interest-bearing loan and borrowings

Provisions

Tax

Pension obligations

Posting to Income Charter income

Rental income

Solstad Offshore ASA Annual Report 2015