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Mar 1, 2016

Overseas Shipholding Group Reports Fourth Quarter and Full Year 2015 Results

NEW YORK –
Overseas Shipholding Group, Inc. (OSG) (NYSE MKT: OSG, OSGB), a provider
of oceangoing energy transportation services, today reported results for
the fourth quarter and full year 2015.

Highlights

  • Fourth quarter and full year 2015 time charter equivalent (TCE)
    revenues(A) of $234.4 million and $924.8 million, grew 18%
    and 21%, respectively, compared with the same periods in 2014.
  • Net income for the fourth quarter was $9.3 million, or $0.02 per
    diluted share, compared with $26.5 million, or $0.05 per diluted share
    for the fourth quarter 2014. The decrease included $27.6 million in
    premiums and fees paid on notes repurchased.
  • Net income for the full year 2015 was $284.0 million, or $0.49 per
    diluted share, compared with $(152.3) million, or $(0.60) per diluted
    share for the full year 2014.
  • Fourth quarter and full year 2015 Adjusted EBITDA(B) was
    $122.9 million and $491.2 million, up 35% and 65%, respectively, from
    $90.9 million and $298.6 million in the same periods in 2014.
  • Total cash(C) was $522.4 million as of December 31, 2015,
    including a $54.9 million cash refund from the Internal Revenue
    Service received in the fourth quarter 2015.
  • Repurchased and retired $326 million in principal amount of unsecured
    notes in 2015, reducing 2016 annual cash interest expense by $25.6
    million.
  • Class A common stock began trading on the NYSE MKT on December 1st
    under the ticker symbol “OSG”, and now has approximately 135 million
    freely tradable shares.
  • Repurchased and retired 2.9 million Class A common stock warrants at
    an average price of $2.92, of which 1.7 million settled in 2016.
  • Repurchased and retired in February 2016 $27 million of the principal
    balance of its domestic term loan at a discounted price of $23.6
    million.
  • The Board has declared a dividend of $0.08 per share.

“We are pleased to report strong results for the 4th quarter
and full year 2015,” said Captain Ian T. Blackley, OSG’s president and
CEO. “The positive supply and demand fundamentals in the international
tanker market, with ton-mile demand expansion in both crude and product
sectors, along with the successful execution of our operating strategy
drove impressive results in our International business. In our Domestic
business, while Jones Act sentiment may have softened from a year ago, I
am pleased to report stronger results for 2015 compared to 2014. The
lower oil price has stimulated increased gasoline consumption in the
United States and we have also seen increasing Domestic lightering
volumes. In both our businesses, we expect that many of the positive
tanker fundamentals we saw in 2015 should remain in place this year.

“The strong cash generation from our 79 vessel fleet and the successful
execution of several key transactions have strengthened our financial
position and provide us with maximum flexibility as we evaluate
strategic alternatives. We see a disconnect today between freight rates,
asset prices and equity values in our industry -this may offer
opportunities that we believe we are well-positioned to capitalize on. I
remain confident in our ability to increase value and, when appropriate,
return value to our shareholders,” concluded Blackley.

Fourth Quarter & Full Year 2015 Results

TCE revenues grew to $234.4 million for the quarter, an increase of
$35.5 million compared with the fourth quarter of 2014, driven by
continuing strength in international crude and product spot market
rates. TCE revenues grew to $924.8 million for the full year 2015, an
increase of $163.5 million compared with the full year 2014.

Net income for the fourth quarter of 2015 was $9.3 million, or $0.02 per
diluted share, compared with $26.5 million, or $0.05 per diluted share
in the fourth quarter of 2014. The decrease included $27.6 million in
bond premium and consent fees and related professional fees paid on
notes repurchased. Net income for the full year 2015 was $284.0 million,
or $0.49 per diluted share, compared to a net loss for the full year
2014 of $152.3 million. Included in the 2015 amount was a one-time,
non-cash income tax benefit of $150.1 million and the net losses in the
comparative 2014 period reflect bankruptcy related charges.

Adjusted EBITDA was $122.9 million for the quarter, an increase of $32.0
million compared with the fourth quarter of 2014, driven primarily by
the strength of spot rates in the international crude and product
markets. Adjusted EBITDA was $491.2 million for the full year 2015, an
increase of $192.6 million compared with the full year 2014, driven
primarily by those higher rates.

International Crude Tankers

TCE revenues for the International Crude Tankers segment were $84.2
million for the quarter, an increase of $32.9 million compared with the
fourth quarter of 2014. This significant increase resulted from a
substantial strengthening in daily rates across all vessel types in the
segment, with the VLCC spot rate increasing to approximately $60,300 per
day in the fourth quarter, nearly double from the comparable 2014
period; the Aframax spot rate increasing 72% to $34,000 per day; and the
Panamax blended rate increasing 17% to $20,300 per day.

TCE revenues for the International Crude Tankers segment were $304.2
million for the full year 2015, an increase of $75.9 million compared
with the full year 2014. For the full year 2015, the VLCC spot rate was
approximately $54,600 per day; the Aframax spot rate $34,000 per day;
and the Panamax blended rate $20,500 per day.

International Product Carriers

TCE revenues for the International Product Carriers segment were $35.7
million for the quarter, down 2% compared with the fourth quarter of
2014. This decrease was due to 430 less revenue days resulting from the
sale of the Luxmar in July 2015, the redelivery of one time chartered-in
vessel and an increase in drydock offhire days, which was partially
offset by higher Medium Range (MR) spot rates. MR spot rates were
approximately $18,100 per day in the fourth quarter, up 21% from the
same period in 2014. TCE revenues for the International Product Carriers
segment were $171.6 million for the full year 2015, an increase of $52.9
million compared with the full year 2014. MR spot rates were
approximately $19,500 per day for the full year 2015.

U.S. Flag

TCE revenues for the U.S. Flag segment were $114.6 million for the
quarter, an increase of $3.2 million compared with the fourth quarter of
2014, driven by a 5% increase in Jones Act Product Carrier TCE revenues.
Additionally, the U.S. Flag segment benefited from increased Delaware
Bay lightering volumes. TCE revenues for the U.S. Flag segment were
$449.1 million for the full year 2015, up 8% compared with the full year
2014, driven by a $28.2 million increase in Jones Act Product Carrier
TCE revenues, largely due to increased rates achieved on renewal of
expiring time charters.

Conference Call

The Company will host a conference call to discuss its fourth quarter
and full year 2015 results at 9:00 a.m. ET on Tuesday, March 1, 2016.

To access the call, participants should dial (866) 490-3149 for domestic
callers and (707) 294-1567 for international callers. Please dial in ten
minutes prior to the start of the call and enter Conference ID 54859058.

A live webcast of the conference call will be available from the
Investor Relations section of the Company’s website at http://www.osg.com/

An audio replay of the conference call will be available starting at
12:00 p.m. ET on Tuesday, March 1, 2016 through 11:59 p.m. ET on
Tuesday, March 8, 2016 by dialing (855) 859-2056 for domestic callers
and (404) 537-3406 for international callers, and entering Conference ID
54859058.

About OSG

Overseas Shipholding Group, Inc. (NYSE MKT: OSG, OSGB) is a publicly
traded tanker company providing energy transportation services for crude
oil and petroleum products in the U.S. and International Flag markets.
OSG is committed to setting high standards of excellence for its
quality, safety and environmental programs. OSG is recognized as one of
the world’s most customer-focused marine transportation companies and is
headquartered in New York City, NY. More information is available at www.osg.com.

Forward-Looking Statements

This release contains forward looking statements. In addition, the
Company may make or approve certain statements in future filings with
the Securities and Exchange Commission (SEC), in press releases, or in
oral or written presentations by representatives of the Company. All
statements other than statements of historical facts should be
considered forward-looking statements. These matters or statements may
relate to the Company’s prospects, including statements regarding trends
in the tanker and articulated tug/barge markets, and including prospects
for certain strategic alliances and investments. Forward-looking
statements are based on the Company’s current plans, estimates and
projections, and are subject to change based on a number of factors.
Investors should carefully consider the risk factors outlined in more
detail in the Company’s Annual Report for 2015 on Form 10-K under the
caption “Risk Factors” and in similar sections of other filings made by
the Company with the SEC from time to time. The Company assumes no
obligation to update or revise any forward looking statements. Forward
looking statements and written and oral forward looking statements
attributable to the Company or its representatives after the date of
this release are qualified in their entirety by the cautionary
statements contained in this paragraph and in other reports previously
or hereafter filed by the Company with the SEC.

A, B, CReconciliations of these non-GAAP financial
measures are included in the financial tables attached to this press
release starting on Page 9.

Consolidated Statements of Operations

($ in thousands, except per share amounts)

Three Months Ended December 31, Fiscal Year Ended December 31,
2015 2014 2015 2014

Shipping Revenues:

(unaudited) (unaudited)

Pool revenues $93,061 $ 62,357 $ 360,218 $ 180,813
Time and bareboat charter revenues 108,482 105,199 437,298 392,669
Voyage charter revenues 42,182 49,372 166,990 383,952
Total Shipping Revenues 243,725 216,928 964,506 957,434
Operating Expenses:
Voyage expenses 9,310 18,007 39,658 196,075
Vessel expenses 74,138 67,389 282,104 268,852
Charter hire expenses 33,659 31,901 128,677 152,016
Depreciation and amortization 44,082 38,365 157,813 151,758
General and administrative 21,040 20,687 79,169 83,716
Technical management transition costs (1 ) 741 39 3,427
Severance and relocation costs (5 ) (1,340 ) – 17,020
(Gain)/Loss on disposal of vessels and other property 7 (6,298 ) (4,251 ) (10,532 )
Total Operating Expenses 182,230 169,452 683,209 862,332
Income from vessel operations 61,495 47,476 281,297 95,102
Equity in income of affiliated companies 14,109 11,911 49,329 41,355
Operating income 75,604 59,387 330,626 136,457
Other (expense)/income (24,329 ) 48 (26,171 ) 426
Income before interest expense, reorganization items

and income taxes

51,275 59,435 304,455 136,883
Interest expense (26,644 ) (28,746 ) (113,335 ) (232,491 )
Income/(loss) before reorganization items

and income taxes

24,631 30,689 191,120 (95,608 )
Reorganization items, net (1,708 ) (6,338 ) (8,052 ) (171,473 )
Income/(loss) before income taxes 22,923 24,351 183,068 (267,081 )
Income tax benefit/(expense) (13,656 ) 2,179 100,892 114,808
Net Income/(Loss) $9,267 $ 26,530 $ 283,960 $ (152,273 )
Weighted Average Number of Common Shares Outstanding:
Basic – Class A 573,595,277 573,423,113 573,507,354 234,082,322
Diluted – Class A 574,317,143 573,467,936 573,744,543 234,082,322
Basic and Diluted – Class B 7,919,840 7,925,960 7,922,020 21,372,197

Per Share Amounts:

Basic and diluted net income/(loss) – Class A and Class B $ 0.02 $0.05 $ 0.49 $ (0.60 )

On December 17, 2015, all shareholders of record of the Company’s
Class A and B common stock as of December 3, 2015, received a dividend
of one-tenth of one share of Class A common stock for each share of
Class A common stock and Class B common stock held by them as of the
record date. In accordance with the relevant accounting guidance, the
Company is required to adjust the computations of basic and diluted
earnings per share retroactively for all periods presented to reflect
that change in capital structure.

Consolidated Balance Sheets

($ in thousands)

December 31,

2015

December 31,

2014

ASSETS
Current Assets:
Cash and cash equivalents $ 502,836 $ 389,226
Restricted cash 10,583 53,085
Voyage receivables 81,612 101,513
Income tax recoverable 1,664 55,856
Other receivables 7,195 8,293
Inventories 3,926 7,987
Prepaid expenses and other current assets 16,115 16,303
Total Current Assets 623,931 632,263
Restricted cash – non current1 8,989

70,093
Vessels and other property, less accumulated depreciation 2,084,859 2,213,217
Deferred drydock expenditures, net 95,241 62,413
Total Vessels, Deferred Drydock and Other Property 2,180,100 2,275,630
Investments in and advances to affiliated companies 348,718 334,863
Intangible assets, less accumulated amortization 50,217 54,817
Other assets 62,997 63,513
Total Assets $ 3,274,952 $ 3,431,179
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable, accrued expenses and other current liabilities $ 91,233 $ 96,066
Income taxes payable 13 906
Current installments of long-term debt 63,039 12,314
Total Current Liabilities 154,285 109,286
Reserve for uncertain tax positions 2,520 34,520
Long-term debt 1,267,766 1,656,353
Deferred income taxes2 208,195 277,965
Other liabilities 61,698 66,968
Total Liabilities 1,694,464 2,145,092
Equity:
Total Equity 1,580,488 1,286,087
Total Liabilities and Equity $ 3,274,952 $ 3,431,179

1 The December 31, 2014 balance sheet
has been revised from that previously reported in the Annual Report on
Form 10-K to reflect the correction of an error by reclassifying
restricted cash of $70,093 from current assets to non-current assets and
to reflect a corresponding reduction in the previously reported amount
for total current assets. The error had no impact on the Company’s
consolidated statements of operations, comprehensive loss, changes in
equity/(deficit) or cash flows.

2 The Company adopted ASU No.
2015-17, Balance Sheet Classification of Deferred Taxes, which provides
for the classification of all deferred tax assets and liabilities as
noncurrent amounts, as of December 31, 2015 and applied the guidance
retrospectively for December 31, 2014. For December 31, 2014, the
Company previously reported a current deferred tax asset of $5,312 and
noncurrent deferred tax liabilities of $283,277; the retrospective
adoption of this accounting standard resulted in noncurrent deferred tax
liabilities of $277,965

Consolidated Statements of Cash Flows

($ in thousands)

Fiscal Year Ended December 31,

2015 2014

Cash Flows from Operating Activities:
Net income/(loss) $ 283,960 $ (152,273 )
Items included in net income/(loss) not affecting cash flows:
Depreciation and amortization 157,813 151,758
Amortization of debt discount and other deferred financing costs 10,989 3,973
Compensation relating to restricted stock and stock option grants 4,412 1,009
Deferred income tax benefit (69,564 ) (82,432 )
Undistributed earnings of affiliated companies (39,052 ) (32,534 )
Deferred payment obligations on charters-in 590 3,232
Reorganization items, non-cash (50 ) 23,715
Other – net 1,971 2,139
Items included in net income/(loss) related to investing and
financing activities:
Gain on disposal of vessels and other property – net (4,251 ) (10,532 )
Payments for drydocking (62,051 ) (37,817 )
Bankruptcy and IRS claim payments (8,343 ) (584,369 )
Deferred financing costs paid for loan modification (9,765 ) –
Changes in other operating assets and liabilities 32,413 (13,018 )
Net cash provided by/(used in) operating activities 299,072 (727,149 )
Cash Flows from Investing Activities:
Change in restricted cash 103,606 (123,178 )
Expenditures for vessels and vessel improvements (1,017 ) (32,412 )
Proceeds from disposal of vessels and other property 17,058 78,426
Expenditures for other property (75 ) (489 )
Investments in and advances to affiliated companies (153 ) (278 )
Repayments of advances from affiliated companies 37,500 30,000
Other – net (383 ) 593
Net cash provided by / (used in) investing activities 156,536 (47,338 )
Cash Flows from Financing Activities:
Issuance of common stock, net of issuance costs – 1,510,000
Issuance of debt, net of issuance and deferred financing costs – 1,176,664
Payments on debt, including adequate protection payments (12,314 ) (2,124,716 )
Repurchase of debt (326,051 ) –
Repurchase of common stock warrants (3,633 ) –
Purchases of treasury stock – (162 )
Net cash (used in)/provided by financing activities (341,998 ) 561,786
Net increase/(decrease) in cash and cash equivalents 113,610 (212,701 )
Cash and cash equivalents at beginning of year 389,226 601,927
Cash and cash equivalents at end of year $ 502,836 $ 389,226

Spot and Fixed TCE Rates Achieved and Revenue Days

The following tables provide a breakdown of TCE rates achieved for spot
and fixed charters and the related revenue days for the three months and
fiscal year ended December 31, 2015 and the comparable periods of 2014.
Revenue days in the quarter ended December 31, 2015 totaled 6,270
compared with 6,919 in the prior year quarter. Revenue days in the
fiscal year ended December 31, 2015 totaled 25,580 compared with 29,386
in the prior year. A summary fleet list by vessel class can be found
later in this press release.

Three Months Ended December 31, 2015 Three Months Ended December 31, 2014
Spot Fixed Total Spot Fixed Total
International Crude Tankers
ULCC
Average TCE Rate $ – $ 39,000 $ – $ –
Number of Revenue Days – 92 92 – – –
VLCC
Average TCE Rate $ 60,340 $ – $ 31,376 $ –
Number of Revenue Days 701 – 701 792 – 792
Aframax
Average TCE Rate $ 34,032 $ – $ 19,827 $ –
Number of Revenue Days 625 – 625 696 – 696
Panamax
Average TCE Rate $ 22,560 $ 17,455 $ 23,414 $ 12,359
Number of Revenue Days 383 293 676 367 445 812
Other Intl. Crude Tankers Revenue Days1 59 – 59 – – –
Total Intl. Crude Tankers Revenue Days 1,768 385 2,153 1,855 445 2,300
International Product Carriers
Aframax Product Carriers
Average TCE Rate $ 27,576 $ – $ 18,855 $ –
Number of Revenue Days 92 – 92 89 – 89
Panamax Product Carriers
Average TCE Rate $ 26,718 $ 16,779 $ 25,388 $ 14,249
Number of Revenue Days 54 143 197 92 274 366
Handysize Product Carriers
Average TCE Rate $ 18,099 $ 5,294 $ 14,908 $ 10,112
Number of Revenue Days 1,638 92 1,730 1,810 184 1,994
Total Intl. Product Carriers Revenue Days 1,784 235 2,019 1,991 458 2,449
U.S. Flag
Jones Act Handysize Product Carriers
Average TCE Rate $ – $ 64,193 $ – $ 59,890
Number of Revenue Days – 1,082 1,082 – 1,104 1,104
Non-Jones Act Handysize Product Carriers
Average TCE Rate $ 34,704 $ 16,630 $ 34,347 $ 12,949
Number of Revenue Days 146 38 184 153 30 183
ATBs
Average TCE Rate $ – $ 38,216 $ – $ 37,945
Number of Revenue Days – 665 665 – 697 697
Lightering
Average TCE Rate $ 83,320 $ – $ 70,790 $ –
Number of Revenue Days 167 – 167 186 – 186
Total U.S. Flag Revenue Days 313 1,785 2,098 339 1,831 2,170
TOTAL REVENUE DAYS 3,865 2,405 6,270 4,185 2,734 6,919
Fiscal Year Ended December 31, 2015 Fiscal Year Ended December 31, 2014
Spot Fixed Total Spot Fixed Total
International Crude Tankers
ULCC
Average TCE Rate $ – $ 39,000 $ – $ –
Number of Revenue Days – 275 275 – – –
VLCC
Average TCE Rate $54,591 $ – $25,803 $16,748
Number of Revenue Days 2,672 – 2,672 3,484 10 3,494
Suezmax
Average TCE Rate $ – $ – $15,603 $ –
Number of Revenue Days – – – 38 – 38
Aframax
Average TCE Rate $34,042 $ – $20,440 $ –
Number of Revenue Days 2,439 – 2,439 3,702 – 3,702
Panamax
Average TCE Rate $25,226 $15,462 $22,414 $12,064
Number of Revenue Days 1,432 1,362 2,794 1,443 1,765 3,208
Other Intl. Crude Tankers Revenue Days1 77 – 77 1,067 – 1,067
Total Intl. Crude Tankers Revenue Days 6,620 1,637 8,257 9,734 1,775 11,509
International Product Carriers
Aframax Product Carriers
Average TCE Rate $32,075 $ – $16,094 $ –
Number of Revenue Days 365 – 365 146 – 146
Panamax Product Carriers
Average TCE Rate $27,465 $17,337 $27,050 $13,829
Number of Revenue Days 327 929 1,256 374 1,063 1,437
Handysize Product Carriers
Average TCE Rate $19,490 $7,004 $12,036 $10,630
Number of Revenue Days 6,949 442 7,391 7,101 776 7,877
Total Intl. Product Carriers Revenue Days 7,641 1,371 9,012 7,621 1,839 9,460
U.S. Flag
Jones Act Handysize Product Carriers
Average TCE Rate $ – $64,350 $ – $58,478
Number of Revenue Days – 4,260 4,260 – 4,205 4,205
Non-Jones Act Handysize Product Carriers
Average TCE Rate $29,453 $15,958 $27,487 $13,528
Number of Revenue Days 535 164 699 656 73 729
ATBs
Average TCE Rate $ – $38,605 $ – $35,372
Number of Revenue Days – 2,700 2,700 – 2,750 2,750
Lightering
Average TCE Rate $79,209 $ – $70,316 $ –
Number of Revenue Days 652 – 652 733 – 733
Total U.S. Flag Revenue Days 1,187 7,124 8,311 1,389 7,028 8,417
TOTAL REVENUE DAYS 15,448 10,132 25,580 18,744 10,642 29,386

1 Other International Crude Tankers
revenue days consists of the Company’s International Flag Lightering
full service revenue days for the quarters and fiscal years ended
December 31, 2015 and December 31, 2014.

Fleet Information

As of December 31, 2015, OSG’s owned and operated fleet totaled 79
International Flag and U.S. Flag vessels (62 vessels owned and 17
chartered-in) compared with 81 at December 31, 2014. Those figures
include vessels in which the Company has a partial ownership interest
through its participation in joint ventures.

Vessels Owned Vessels Chartered-in Total at December 31, 2015
Vessel Type Number Weighted by
Ownership 		Number Weighted by
Ownership 		Total Vessels Vessels
Weighted by
Ownership 		Total Dwt2
Operating Fleet
FSO 2 1.0 – – 2 1.0 873,916
VLCC and ULCC 9 9.0 – – 9 9.0 2,875,798
Aframax 7 7.0 – – 7 7.0 787,859
Panamax 8 8.0 – – 8 8.0 557,187
International Flag Crude Tankers 26 25.0 – – 26 25.0 5,094,760
LR2 1 1.0 – – 1 1.0 109,999
LR1 4 4.0 – – 4 4.0 297,705
MR 13 13.0 7 7.0 20 20.0 955,979
International Flag Product Carriers 18 18.0 7 7.0 25 25.0 1,363,683
Total Int’l Flag Operating Fleet 44 43.0 7 7.0 51 50.0 6,458,443
Handysize Product Carriers 1 4 4.0 10 10.0 14 14.0 664,490
Clean ATBs 8 8.0 – – 8 8.0 226,064
Lightering ATBs 2 2.0 – – 2 2.0 91,112
Total U.S. Flag Operating Fleet 14 14.0 10 10.0 24 24.0 981,666
LNG Fleet 4 2.0 – – 4 2.0 864,800 cbm
Total Operating Fleet 62 59.0 17 17.0 79 76.0 7,440,109
and
864,800 cbm

1 Includes two owned shuttle tankers, one chartered in
shuttle tanker and two owned U.S. Flag Product Carriers that trade
internationally.

2 Total Dwt is defined as the total deadweight of all 79
vessels.

Reconciliation to Non-GAAP Financial Information

The Company believes that, in addition to conventional measures prepared
in accordance with GAAP, the following non-GAAP measures may provide
certain investors with additional information that will better enable
them to evaluate the Company’s performance. Accordingly, these non-GAAP
measures are intended to provide supplemental information, and should
not be considered in isolation or as a substitute for measures of
performance prepared with GAAP.

(A) Time Charter Equivalent (TCE) Revenues

Consistent with general practice in the shipping industry, the Company
uses TCE revenues, which represents shipping revenues less voyage
expenses, as a measure to compare revenue generated from a voyage
charter to revenue generated from a time charter. Time charter
equivalent revenues, a non-GAAP measure, provides additional meaningful
information in conjunction with shipping revenues, the most directly
comparable GAAP measure, because it assists Company management in making
decisions regarding the deployment and use of its vessels and in
evaluating their financial performance. Reconciliation of TCE revenues
of the segments to shipping revenues as reported in the consolidated
statements of operations follow:

Three Months Ended December 31, Fiscal Year Ended December 31,
($ in thousands) 2015 2014 2015 2014
TCE revenues $234,415 $198,921 $924,848 $761,359
Add: Voyage Expenses 9,310 18,007 39,658 196,075
Shipping revenues $243,725 $216,928 $964,506 $957,434

(B) EBITDA and Adjusted EBITDA

EBITDA represents net (loss)/income before interest expense, income
taxes and depreciation and amortization expense. Adjusted EBITDA
consists of EBITDA adjusted for the impact of certain items that we do
not consider indicative of our ongoing operating performance. EBITDA and
Adjusted EBITDA do not represent, and should not be considered a
substitute for, net (loss)/income or cash flows from operations as
determined in accordance with GAAP. Some of the limitations are: (i)
EBITDA and Adjusted EBITDA do not reflect our cash expenditures, or
future requirements for capital expenditures or contractual commitments;
(ii) EBITDA and Adjusted EBITDA do not reflect changes in, or cash
requirements for, our working capital needs; and (iii) EBITDA and
Adjusted EBITDA do not reflect the significant interest expense, or the
cash requirements necessary to service interest or principal payments,
on our debt. While EBITDA and Adjusted EBITDA are frequently used by
companies as a measure of operating results and performance, neither of
those items as prepared by the Company is necessarily comparable to
other similarly titled captions of other companies due to differences in
methods of calculation. The following table reconciles net
income/(loss), as reflected in the consolidated statements of
operations, to EBITDA and Adjusted EBITDA:

Three Months Ended December 31, Fiscal Year Ended December 31,
($ in thousands) 2015 2014

2015

2014
Net Income/(loss) $9,267 $26,530

$283,960

$ (152,273)
Income tax expense/(benefit) 13,656 (2,179)

(100,892)

(114,808)
Interest expense 26,644 28,746

113,335

232,491
Depreciation and amortization 44,082 38,365

157,813

151,758
EBITDA 93,649 91,462

454,216

117,168
Technical management transition costs (1) 741

39

3,427
Severance and relocation costs (5) (1,340)

–

17,020
(Gain)/loss on disposal of vessels and other property 7 (6,298)

(4,251)

(10,532)
Loss on repurchase of debt 24,477 –

26,516

–
Other costs associated with repurchase of debt 3,099 –

3,099

–
Write-off of registration statement costs – –

3,493

–
Reorganization items, net 1,708 6,338

8,052

171,473
Adjusted EBITDA $122,934 $90,903

$491,164

$298,556

(C) Total Cash

($ in thousands) December 31,

2015

December 31,

2014

Cash and cash equivalents $502,836 $389,226
Restricted cash 19,572 123,178
Total Cash $522,408 $512,404

For Overseas Shipholding Group, Inc.:
Investor Relations & Media:
Brian
Tanner, 212-578-1645
btanner@osg.com