NORDIC AMERICAN TANKERS LIMITED
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(registrant)
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Dated: Novenber 29, 2021
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By:
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/S/ HERBJØRN HANSSON
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Herbjørn Hansson
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Chairman, President, and Chief Executive Officer
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1 |
There is so much confusing day-to-day noise in the markets about oil and gas prices that we think many investors have decided to steer clear of
the tanker sector entirely. All markets are volatile, and as history has shown volatility can be our friend when rates rise suddenly and the company’s stock price benefits. We firmly believe that successful investors buy quality companies
and profit handsomely when the tide turns.
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2 |
A main feature of the NAT strategy is that NAT has Suezmaxes only. No other public company has this feature. Asset values continue to rise.
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3 |
The International Energy Agency in Paris confirms that global oil demand is nearing pre-pandemic levels of early 2020 and more importantly, oil
supply is now rising fast. This is good news for the NAT suezmaxes and provide confidence that a turn-around for the NAT fleet is getting closer by the day.
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4 |
During recent months we have secured term contracts with prompt delivery for six months or longer at rates above $20,000/day or more for four of
our vessels. The time charter rates for these ships were substantially higher than the spot market at the time and still are. These four contracts work as a hedge. Our fleet of 24 ships has significant upside.
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5 |
On November 5, 2021 the “Nordic Sirius” was delivered to new owners. The price to us was between $14 – 15 million. After the transaction our fleet
counts 24 units, including 2 newbuildings. The estimated value for our two newbuildings is now about $70 million per ship. They were ordered at about $55 million per ship.
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6 |
The proceeds from the above mentioned sale has been used to pay down part of our $306 million senior secured facility with CLMG/Beal Bank of
Texas. The company’s total net debt is $259.6 million or $11.8 million per vessel (based on 22 vessels). Our objective is to become debt free.
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7 |
The pandemic has lasted longer than we anticipated at the outset in early 2020. The third quarter of 2021 was the low point. The average time
charter equivalent (TCE) for our active fleet during 3Q 2021 came in at $5,800 per day per ship – this was down from 2Q 2021 at $7,800 per day. NAT is through the low point. The average earnings
for a Suezmax tanker for the last 30 years has been close to $30,000 per day per ship.
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8 |
The third quarter of 2021 produced a net loss of -$44.7 million or a earnings per share (EPS) of -$0.27. Adjusted
for an impairment of $8.4 million (non-cash) the net loss was -$36.3 million and adjusted EPS of -$0.22. this compares
to the previous quarter, that came in at a net loss of -$28.7 million or an EPS of -$0.18.
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9 |
Dividend is a priority for NAT and a reflection of our earnings. The dividend for 3Q 2021 is 1 cent ($0.01) per
share, payable on Tuesday December 21, 2021, to shareholders on record Tuesday December 7, 2021. This is our 97th consecutive quarterly dividend payment.
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10 |
We have an excellent vetting record on our vessels, perhaps the best sign of a tanker company’s reliability. Vetting is the scorecard provided by
our customers.
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11 |
Financial information for the third quarter of 2021 and for other periods is included later in this report.
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1) |
The total outstanding balance to CLMG/Beal Bank (including current portion of the debt), is $241.3 million as of September 30, 2021. This includes
the original amount of $306 million from February 2019 and the accordion loan of $30 million from December 2020. Restricted cash of $5.8 million is related to deposits held for future Drydockings
of our vessels, in accordance with our borrowing agreement. After the sale of one vessel, the total outstanding balance to CLMG/Beal Bank as of the date of this report is $225.9 million.
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2) |
The total outstanding balance to Ocean Yield (including current portion of the debt) is $106.3 million as of September 30, 2021.
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NORDIC AMERICAN TANKERS LIMITED
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CONSOLIDATED CONDENSED STATEMENTS OF OPERATION
(UNAUDITED)
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Three Months Ended | Nine Months Ended | ||||||||||||||||||
Amounts in USD '000 |
Sep. 30, 2021
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Jun. 30, 2021
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Sep. 30, 2020
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Sep. 30, 2021
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Sep. 30, 2020
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|||||||||||||||
Net Voyage Revenue
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9,313
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16,747
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37,287
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44,872
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217,237
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|||||||||||||||
Vessel Operating Expenses
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(17,388
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)
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(17,603
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)
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(17,501
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)
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(51,440
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)
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(50,199
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)
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General and Administrative Expenses
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(4,096
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)
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(3,504
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)
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(4,079
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)
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(11,264
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)
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(12,699
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)
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Depreciation Expenses
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(17,595
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)
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(17,402
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)
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(17,440
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)
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(52,074
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)
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(50,792
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)
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||||||||||
Impairment
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(8,406
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)
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0
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0
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(8,406
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)
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0
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|||||||||||||
Operating Expenses
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(47,485
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)
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(38,509
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)
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(39,020
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)
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(123,184
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)
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(113,690
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)
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Net Operating Income (Loss)
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(38,172
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)
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(21,762
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)
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(1,733
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)
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(78,312
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)
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103,547
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|||||||||||
Interest Income
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(1
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)
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0
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0
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2
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94
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||||||||||||||
Interest Expense
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(6,397
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)
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(6,643
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)
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(8,218
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)
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(19,719
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)
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(24,953
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)
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||||||||||
Other Financial Income (Expenses)
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(95
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)
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(283
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)
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(70
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)
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(350
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)
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8
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Total Other Expenses
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(6,493
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)
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(6,926
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)
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(8,288
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)
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(20,067
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)
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(24,851
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)
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Net Income (Loss)
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(44,665
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)
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(28,688
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)
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(10,021
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)
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(98,379
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)
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78,696
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|||||||||||
Basic and Diluted Earnings (Loss) per Share
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(0.27
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)
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(0.18
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)
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(0.07
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)
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(0.63
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)
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0.53
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Weighted Average Number of Common Shares Outstanding
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164,225,057
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155,595,376
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149,797,475
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157,271,349
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148,680,579
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|||||||||||||||
Common Shares Outstanding
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171,964,413
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158,464,967
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150,461,345
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171,964,413
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150,461,345
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|||||||||||||||
CONSOLIDATED CONDENSED BALANCE SHEET (UNAUDITED)
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Amounts in USD '000
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Sep. 30, 2021 |
Dec. 31, 2020
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Cash and Cash Equivalents
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32,031
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57,847
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Restricted Cash
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5,827
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4,223
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Accounts Receivable, Net
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8,131
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6,349
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Prepaid Expenses
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3,997
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5,477
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Inventory
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16,752
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19,408
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Voyages in Progress
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4,551
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4,644
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Other Current Assets
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3,426
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1,574
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Vessels Held for Sale
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29,726
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0
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Total current assets
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104,441
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99,522
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Vessels, Net
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779,076
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861,342
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Vessels under Construction
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23,523
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11,000
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Other Non-Current Assets
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4,734
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2,483
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Total Non-Current Assets
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807,332
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874,825
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Total Assets
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911,773
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974,347
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Accounts Payable
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4,372
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4,099
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Accrued Voyage Expenses
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8,134
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5,254
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Other Current Liabilities
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8,156
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8,232
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Dividends Payable
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1,713
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0
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Current Portion of Long Term Debt
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51,786
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*
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22,094
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Total Current liabilities
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74,161
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39,679
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Long-Term Debt
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288,403
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334,615
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Other Non-Current Liabilities
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1,505
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927
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Total Non-current Liabilities
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289,908
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335,542
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Shareholders' Equity
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547,704
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599,126
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Total Liabilities and Shareholders' Equity
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911,773
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974,347
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* Current Portion of Long-Term Debt as of September 30, 2021 includes $29.4 million for expected debt repayments associated with Vessels Held for Sale of which $13.9 million
was repaid in November.
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NORDIC AMERICAN TANKERS LIMITED
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CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOW
(UNAUDITED)
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Nine Months Ended
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Twelve Months Ended
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Amounts in USD '000 |
Sep. 30, 2021
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Dec. 31, 2020
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Net Cash Provided by/(Used in) Operating Activities
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(37,575
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)
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110,944
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Investment in Vessels
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(2,372
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)
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(6,845
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)
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Investment in Other Fixed Assets
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(560
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)
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(233
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)
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Investment in Vessels under Construction
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(12,477
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)
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(11,000
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)
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Proceeds from Sale of Investment Securities
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0
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602
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Net Cash Used in Investing Activities
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(15,409
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)
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(17,476
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)
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Proceeds from Issuance of Common Stock
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54,566
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20,713
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Proceeds from Borrowing Activities
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0
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29,300
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Repayments of Vessel Financing
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(5,918
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)
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(7,630
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)
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Repayment of Borrowing Facility
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(12,605
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)
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(67,896
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)
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Financing Transaction Costs
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(1,100
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)
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(320
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)
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Dividends Distributed
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(6,180
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)
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(67,242
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)
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Net Cash Provided by/(Used in) Financing Activities
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28,763
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(93,075
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)
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Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash
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(24,221
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)
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393
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Effect of exchange rate changes on Cash
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9
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39
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Cash, Cash Equivalents and Restricted Cash at Beginning of Period
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62,070
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61,638
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||||||
Cash, Cash Equivalents and Restricted Cash at End of Period
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37,858
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62,070
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Cash and Cash Equivalents
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32,031
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57,847
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Restricted Cash
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5,827
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4,223
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NORDIC AMERICAN TANKERS LIMITED
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RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (UNAUDITED)
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Three Months Ended
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Nine Months Ended
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||||||||||||||||||
Amounts in USD '000
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Sep. 30, 2021
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Jun. 30, 2021
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Sep. 30, 2020
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Sep. 30, 2021
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Sep. 30, 2020
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|||||||||||||||
Voyage Revenue
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52,394
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52,394
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56,044
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140,722
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310,777
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|||||||||||||||
Voyage Expense
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(35,647
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)
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(35,647
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)
|
(18,757
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)
|
(95,851
|
)
|
(93,540
|
)
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||||||||||
Net Voyage Revenue (1)
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16,747
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16,747
|
37,287
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44,872
|
217,237
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|||||||||||||||
Three Months Ended
|
Twelve Months Ended
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|||||||||||||||
Amounts in USD '000
|
Sep. 30, 2021
|
Jun. 30, 2021
|
Sep. 30, 2020
|
Dec. 31, 2020
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||||||||||||
Net Income (Loss)
|
(44,665
|
)
|
(28,688
|
)
|
(10,021
|
)
|
50,033
|
|||||||||
Interest Expense
|
6,397
|
6,643
|
8,218
|
31,481
|
||||||||||||
Interest Income
|
1
|
0
|
0
|
(96
|
)
|
|||||||||||
Depreciation Expense
|
17,595
|
17,402
|
17,440
|
67,834
|
||||||||||||
EBITDA (2)
|
(20,672
|
)
|
(4,643
|
)
|
15,637
|
149,252
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||||||||||
Impairment
|
8,406
|
0
|
0
|
0
|
||||||||||||
ADJUSTED EBITDA
|
(12,266
|
)
|
(4,643
|
)
|
15,637
|
149,252
|
(1)
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Net voyage revenues represents voyage revenues less voyage expenses such as bunker fuel, port fees, canal tolls and brokerage commissions. Net voyage
revenues is included because certain investors use this data to measure a shipping company's financial performance. Net voyage revenues is not required by accounting principles generally accepted in the United States and should not be
considered as an alternative to net income or any other indicator of the Company's performance required by accounting principles generally accepted in the United States.
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(2)
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EBITDA is included because certain investors use this data to measure a shipping company's financial performance. EBITDA is not required by accounting
principles generally accepted in the United States and should not be considered as an alternative to net income or any other indicator of the Company's performance required by accounting principles generally accepted in the United
States.
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