MIF Reports Rebound In First Half Profits

Hamilton, Bermuda: 31 August 2000 - MIF today reported unaudited results for the first six months of 2000. Revenues on a time charter basis for the first half of 2000 were $37.57 million, or 5.3% above those for the first six months of 1999. Income from Operations was $23.34 million, or an improvement of 5.6% from the like period in 1999. Income before Depreciation rose to $14.02 million, which reflected a gain of 14.4% over the first six months of 1999. Net Income rebounded sharply to $3.76 million in the first half of 2000, or more than double the $1.66 million of Net Income for the first half of 1999. These highly favorable comparisons reflected a number of factors.

The fleet of sixteen tankers (including one chartered-in Aframax) represents over 1,420,000 DWT with an average age of less than eight years, or approximately one-half of the age of the world tanker tonnage. Although the MIF fleet is basically unchanged as to size and composition during the past year, Revenues grew $1.91 million, reflecting a modest improvement in the charter market and the absence of special, non-recurring unscheduled off-hires for two vessels late in the first half of 1999, which reduced Revenues and Net Income by over $750,000 during the first half of 1999.

The second quarter results for 2000 were particularly favorable. Revenues were up $1.91 million, or 10.8%, as a result of the previously cited factors of a somewhat stronger charter market and the absence of special unscheduled off-hires. Profitability also benefited from lower Operating Expenses, Net Interest Expense, and Depreciation. As a result, Net Income for the second quarter of 2000 was $2.69 million compared with a second quarter loss of $0.32 million in 1999, which on a normalized basis adjusted for special, non-recurring revenue shortfalls produced a profit of approximately $0.45 million.

The strong recovery in charter rates enjoyed by most of the tanker industry has contributed to the sharp rebound in profits for MIF. This most welcome development is indeed refreshing. At this time a year ago, the industry was operating in a depressed environment and the prospects for immediate recovery were dim. The ensuing twelve months have witnessed solid progress on many fronts. Virtually all regions of the globe are enjoying solid economic growth. Demand for and availability of petroleum and petroleum products has spurred demand for transport by tankers. The supply/demand factors have maintained equilibrium. Thus, in contrast to a year ago, the very near term prospects suggest a healthy charter market and MIF plans to share in this prosperity.

Our optimism regarding the future is best illustrated by our intermediate term investment program. MIF presently has on order three newbuilding Suezmaxes to be delivered in 2002, as well as an additional Suezmax under contract option. MIF has a further three newbuilding Panamaxes under contract option with scheduled delivery in 2000 and 2001. These prospective additions to the MIF fleet underscore the strategy of developing a young and growing fleet.