May 5, 2005

OSG reports soaring income

Overseas Shipholding Group, Inc. (NYSE:OSG) reported net income for the quarter ended March 31, 2005 of $164,919,000, or $4.18 per share, more than double the net income of $76,188,000, or $1.99 per share, achieved in the first quarter of 2004. EBITDA for the first quarter rose by 43% to $223,363,000 compared with $156,413,000 in the first quarter of 2004 and TCE revenue in the quarter increased by 41% to $267,187,000 compared with $188,982,000 in the first quarter of 2004.

"Net income more than doubled to $165 million in the first quarter compared with the prior year period and was better than net income for every full year in the Company's history except 2004," said Morten Arntzen, President and Chief Executive Officer. "This outstanding performance reflects strong operating results in our crude transportation business, healthy contributions from the 40 ships of the former Stelmar fleet beginning on January 21, 2005 and elimination of tax on the shipping income from our foreign fleet."

"This quarter was all about the men and women of OSG executing our strategy of striving to be the leader in those segments in which we compete -- international crude, products, U.S. Flag and LNG. We said we would outperform the public tanker sector this quarter and as a result of the performance by our crude segment, the Stelmar acquisition and the tax law change, we delivered on our commitment. We intend to do the same for the full year."

"In line with our commitment to build a world class product carrier business, we closed on the Stelmar acquisition on January 20, 2005. This acquisition added 24 product carriers to our fleet and gave us the scale we need to compete globally in this trade. The integration of Stelmar into OSG is proceeding seamlessly and, through the hard work of our employees, is generating revenue enhancements, expense savings and better ways to operate our business. The acquisition also strengthened our already first class crude transportation business by adding 13 Panamax crude tankers and three Aframax tankers."

"In line with our commitment to grow our U.S. Flag business, last month we announced the signing of a letter of intent to bareboat ten newbuilding Jones Act Product Carriers which will be built at the Kvaerner Philadelphia Shipyard. This is the largest commercial newbuilding program announced at a U.S. yard in many decades.



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