Tsakos Energy Navigation (TEN) Reports Strong Profits For The Third Quarter And First Nine Months

TEN's Third Quarter Highlights:

· Company reports EPS of $0.47 versus $0.04 in the like period of 2002

· Net income rose 1124% to $8.03 million

· Company took delivery of a new aframax and the last in a series of four new panamaxes

TEN's Nine Months Highlights:

· Reported record EPS of $2.61 a 402% increase over the like period of 2002.

· Net income increased 463% to a record $44.81 million

· Took delivery of six newbuilding: two aframaxes and four panamaxes.

Net revenues for the third quarter of 2003 were $52.45 million compared with $29.26 million in the third quarter of 2002. Income before depreciation was $16.80 million for the third quarter of 2003 against $7.05 million in the like period of 2002. Net income in the most recent quarter was $8.03 million compared with $0.66 million in the third quarter last year. Earnings per share, basic, based on the weighted average number of shares outstanding, was $0.47 in the third quarter of 2003 as compared with $0.04 in the third quarter of 2002.

Net revenues for the first nine months of 2003 were $169.65 million, compared with $84.40 million for the like period of 2002. Operating income for the nine months of 2003 was $53.48 million versus $17.06 million for the nine months of 2002. Income before depreciation was $69.13 million for the first three quarters of 2003 as against $25.30 million for the like period of 2002. Net income for the first nine months of 2003 was $44.81 million versus $7.96 million in the nine months of 2002. Earnings per share, basic, based on the weighted average number of shares outstanding was $2.61 in the three quarters of 2003 as compared with $0.52 in the three quarters of 2002.

Voyage expenses for the first nine months of 2003 were $46.79 million compared with $21.42 million for the like period of 2002 reflecting an increase in fleet size and several more vessels being on spot charter. Operating costs increased to $34.65 million in the nine months of 2003 from $22.47 million in 2002 due to the expanded fleet, higher insurance rates, added repair costs, and the impact of a weaker U.S. dollar.

Depreciation and amortization costs were $30.18 million in the nine months of 2003 up from $20.44 million in 2002 reflecting significant fleet expansion. For the same reason management and overhead costs have been $4.56 million thus far this year versus $3.02 million for the first nine months of 2002. Interest and finance costs were $8.84 million for the first nine months versus $9.71 million in the like period of 2002 reflecting lower effective finance rates which more than offset the increase in debt to partially fund the expansion of the fleet.

Vessel operating expenses rose reflecting the increased number and size of TEN's vessels, but per vessel costs were reasonably contained ($5,688 per vessel in the nine months of 2003 as compared with $5,402 per vessel in the first nine months of 2002) despite higher insurance rates and the impact of the weakened U.S. dollar.

"TEN continues to deliver solid financial performance and value to our shareholders," stated Mr. Nikolas Tsakos, President and CEO of TEN. "Management's attention to detail, our ability to provide quality service and tonnage to our clients and our competitive cost structure serve as the foundation to our continued success. The benefit of a 101% increase in net revenues was transmitted fully to the bottom line with net income in the first nine months recording a healthy 463% increase."

FLEET EXPANSION

The expansion program initiated in 1997 continues to provide TEN with strong organic growth. During 2003, the company has added six newbuildings to its fleet comprised of two aframaxes and four panamaxes. To date, the program has added sixteen newbuildings to the fleet. Mr. Tsakos added, "Our newbuildings scheduled for delivery in 2004, 2005, and 2006 currently include three handysize products carriers and four suezmaxes, all of which are ice classed." TEN also holds additional options for three additional handysize product carriers.

Mr. Tsakos noted, "The newbuilding program has given us the ability to design our fleet to meet the evolving needs of our clients and to benefit from the economies of sister ship operations. Our seven firm future deliveries plus our three options brings the overall newbuilding program to 26 vessels, positioning us with one of the youngest and most modern fleets of tankers in the world."

"The importance of our organic growth program is directly evidence in its impact on profits," Mr. Tsakos continued. "TEN's newbuildings since 1997 comprise approximately 53% of the active fleet, and produced profits of approximately $39 million, or 85% of net income, during the first nine months of 2003."

TANKER PROSPECTS

The general expectation of industry analysts is that worldwide consumption of oil will increase by a total of 1.4% in 2003. Early forecasts suggest similar growth next year. Near term demand for tanker capacity will be influenced by the low level of inventories, winter heating demands in the northern hemisphere, and the sources of oil shipments. TEN believes the promise of growth in the U.S. and the Pacific Rim economies as well as India support the expectations for increased demand for petroleum and its products over coming months.

The supply side should experience modest growth in overall tanker carrying capacity. However, regulatory restrictions and charterer selectivity should promote solid demand for well managed modern tonnage. TEN is encouraged by the modest seasonal swings in the second and third quarter of 2003 and the favorable comparisons in rates during October 2003. It is reasonable to assume that the typical upswing in tanker rates during the northern hemisphere winter months will be repeated.

TEN'S OUTLOOK

TEN has benefited from the strong spot market for suezmaxes and aframaxes enjoyed throughout the bulk of 2003 and the timing of fleet additions has been most fortunate. Although TEN expects cost pressures will continue due to a soft U.S. dollar, high bunker prices, and rising insurance rates, TEN expects favorable earnings comparisons in the final quarter of 2003.

Consistent with TEN's corporate policy, management has maintained a balance in its employment mix with an emphasis on fixing selected vessels on a medium to long-term basis. Currently, TEN has 20 vessels on period employment (including fixed rate, variable rate, and minimum rate plus charters) and 7 vessels operating in the spot market. Approximately 65% of available days for existing vessels are under contract for 2004 with total projected minimum revenues of those charters of approximately $120 million.

SHARE REPURCHASE

During the first ten months of 2003, the company has repurchased and retired 140,100 shares of common stock. The repurchase program has $2.4 million in remaining authorized funds. The company plans to make share purchases on the open market in coming months, but has not set a timetable for such purchases.

DIVIDEND PAYMENT

During October 2003, the Board of Directors declared and the company paid a semi-annual dividend of $.050, per share. The Directors will consider the next dividend in February for payment in April.