Golden Ocean Group Limited
Preliminary Fourth Quarter and Financial Year 2008 Results
Quarter and Year ended December 31, 2008

Golden Ocean Group Limited (the “Company” or “Golden Ocean”) reports net income of $26.7 million and earnings per share of $0.10 for the fourth quarter of 2008. This compares with net income and earnings per share of $118.7 million and $0.43 for the third quarter of 2008. The market showed a strong negative development in the quarter. Total operating revenues for the fourth quarter were $170.6 million, total operating expenses were $139.3 million and net other expenses were $13.4 million. Included in operating revenues is $39.0 million resulting from the cancellation and settlement of existing charters for three of the Company’s vessels as discussed further below.

Based on the “value in use” principle the Company has evaluated the carrying value of its assets and has not booked any impairment losses. However, a total loss of $28 million has been recognised in charterhire expenses in the fourth quarter relating to existing and future loss making charter arrangements. The Company has also recorded an impairment loss of $8.5 million relating to its holding of 5,275,145 shares of Navios Maritime Holdings Inc. (“Navios”). As discussed in our third quarter 2008 report, the Company has a total investment in Navios of $48.1 million. The market value of this investment at December 31, 2008 was $16.7 million and as of February 25, 2009 it was $13.2 million. The Company generated net operating income of $40.2 million compared to $121.8 million in the third quarter.

Cash and cash equivalents decreased by $13.2 million during the quarter. The Company generated cash from operating activities of $61.3 million, and used $41.7 million and $32.7 for investing and financing activities. The investing amount includes part payments on newbuilding instalments of $86.6 million and proceeds from sale of assets of $44.7 million. During the fourth quarter the Company repaid $108.4 million in debt and borrowed an additional $77.8 million.

For the year ended December 31, 2008 the Company reports a net income of $400.1 million and earnings per share of $1.44. Total operating revenues were $947.5 million, total operating expenses were $723.8 million and net other expenses were $32.7 million.

At December 31, 2008 the total number of shares outstanding in Golden Ocean was 276,990,107 of $0.10 par value each.

Corporate and Finance

December 2008 - the Company took delivery of two Panamax newbuildings contracted in 2006 from Jiangsu Rong Sheng Heavy Industries. As announced in March 2007, one of the vessels were sold and were delivered to the buyer directly from the shipyard. A profit of $9 million is included in the Q4 2008 accounts. February 2009 - the buyer of the Panamax vessel M/V Bellflower informed the Company that they do not have the financial resources to take delivery of the vessel at $76 million. Based on that, the Company has accepted to sell the vessel at a reduced price of $50 million. The new agreement includes a $10 million second priority financing with seven years maturity to rank after a first priority mortgage maximized to $18 million. The vessel is scheduled to be delivered to the buyer in March 2009.

February 2009 - the vessels M/V Mulberry Paris and M/V Mulberry Wilton have been redelivered to the Company from their existing charters. A cash compensation of approximately $25 million has been agreed upon for the balance period commitment up to the third quarter of 2011. As of today $20 million has been received. Both vessels will be trading in the spot market until further notice. The loss for Golden Ocean compared to the present forward market is approximately $32.0 million with the potential for some further recovery based on a positive financial development of the charterer. The loss is sensitive to the spot earnings for the two vessels going forward. In addition, the Company has received $14.6 million upon the cancellation and settlement of the charter for the vessel Irfon.

February 2009 - due to non-compliance with the terms and conditions for the sale/leaseback agreements of two Capesize vessels to be delivered from Daehan Shipbuilding, Ship Finance International Limited and Golden Ocean have agreed to terminate the agreement. The Company is in discussions with banks to replace these two financing arrangements.

In view of the current financial market conditions, the Company’s newbuilding commitments and the Company’s liquidity position it has been decided not to declare a dividend for the fourth quarter of 2008.

Market

The negative trend the dry bulk sector witnessed during the third quarter of 2008 continued with further declines during the fourth quarter. The absolute low was reached on the 2nd of December when the average spot earnings for a Capesize vessel were $2,316 per day. Earnings improved gradually through December and ended the year at $18,000 per day. Panamax earnings were comparatively stronger with average earnings for the fourth quarter at $7,740 per day, compared to Capesize vessels at $11,250 per day. This reflects the fact that the Capesizes vessels predominantly carry raw materials for the steel industry. Iron ore imports to China were reduced from 115 million tonnes in the third quarter of 2008 to around 75 million tonnes in the fourth quarter. The Chinese steel mills postponed shipments of iron ore for three main reasons:

- Lower demand for steel pushed steel prices lower.
- Due to the fact that spot prices of iron ore were lower than contract prices, the steel mills “were forced to” halt shipments.
- There was a considerable build up of iron ore inventories in Chinese ports which reached record high levels of 80 million tonnes in the 20 major Chinese import ports.

In addition to lower volumes, both shorter sailing distances and less congestion had a negative impact on the fleet utilization. As much as 20 per cent of the Capesize fleet could be considered to be in an idle condition in the early parts of December.

While values were holding steady through the third quarter of 2008, the dry bulk sector experienced a strong negative correction in values during the fourth quarter of 2008.

Sale and Purchase Shipbrokers estimated the value of a 5 year old Panamax to be just below $30 million by the end of 2008, compared to $70 million three months earlier. Similar numbers for Capesizes were $48 million and $120 million respectively, representing a 60 per cent drop in values.

Outlook and Strategy

The global economic outlook remains weak. Some analysts predict a negative global GDP growth for 2009. We expect the Chinese stimulus package of RMB 4 trillion to be spent mostly on infrastructure projects in the next two years which should have a positive effect on the dry bulk shipping demand.

There is however concern that the structural over capacity which is recognized in the dry bulk market, will keep the overall fleet utilisation low over the next twelve to eighteen months. On the bright side we have noticed a substantial increase in scrapping in the last three months and with the fairly bleak market outlook we expect this trend to continue. The supply side can be further reduced as a function of bankruptcies and cancellation of orders.

Golden Ocean has during the last two years had a relatively conservative chartering philosophy. A major part of the tonnage was fixed on long-term time charter agreements, and several vessels were sold to secure the financial fundamentals for expanding the Company through ordering of newbuildings.

During the last months the Company has experienced that several of its counterparts are not financially in a position to honour these agreements. This non-performance of charter agreements has created material financial problems for Golden Ocean.

The Company has received commited financing for a total of 11 of the Company’s remaining newbuildings, while 10 ships remain unfinanced. The likely breach of covenants in the bond debenture will make it difficult to utilize these facilities. This is likely to create a situation in March 2009 where the Company will run out of cash liquidity to meet its short term obligations.

On this basis the Company has started discussions with its creditors in order to financially restructure the Company. Such a restructuring will have to be completed within March. A restructuring will be dependent on bringing in new equity as well as being able to reduce the financial newbuilding commitments. The size of any new equity will be dependent on possible agreements with creditors as well as the Companies ability to reduce the newbuilding commitments. It is likely that the providers of new equity, because of the lack of existing equity value, will ask for significant concessions from the Company’s unsecured debt holders.

If a solution with the creditors and the yards can be found the Board is hopeful that a constructive basis for continuation of Golden Ocean can be established. An injection of new equity in combination with the modern fleet and the existing charter coverage could create a profitable company going forward to the benefit of all stakeholders.

Golden Ocean Group Limited