[Executive Summary & Company Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Company%20Highlights) TOP Ships Inc. achieved record net income in 2022, demonstrating significant financial growth and implementing shareholder-friendly measures - TOP Ships Inc. announced record net income for the year ended December 31, 2022, marking the highest reported net income since 2008 and a **120% increase** from 2021[1](index=1&type=chunk)[2](index=2&type=chunk) Key Financial Highlights (Year Ended December 31, 2022) | Metric | Amount (Millions USD) | Change from 2021 | | :-------------------------- | :-------------------- | :--------------- | | Total Revenues | $80.7 | +43% | | Net Income | $18.9 | +120% | | EBITDA | $46.6 | +100% | | Total Assets | $469.3 | +42% | | Total Cash and cash equivalents (including Restricted Cash) | $24.5 | +285% | - The Company adopted shareholder-friendly measures for the period from the release date to December 31, 2023, including[2](index=2&type=chunk)[6](index=6&type=chunk) * No new equity offerings (public or private) * No reverse stock splits, except if deemed advisable by the Board for Nasdaq listing compliance * No bonuses to executive management * Neither the CEO nor his affiliates will sell any common shares - Mr. Evangelos J. Pistiolis, President, CEO, and Director, stated that the current trading price of common shares does not reflect the Company's intrinsic value and that the announced actions will benefit all shareholders[2](index=2&type=chunk) [About the Company](index=1&type=section&id=About%20TOP%20Ships%20Inc.) TOP Ships Inc. operates internationally as an owner and operator of modern, fuel-efficient "ECO" tanker vessels - TOP Ships Inc. is an international owner and operator of modern, fuel-efficient "ECO" tanker vessels[1](index=1&type=chunk)[3](index=3&type=chunk) [Forward-Looking Statements](index=1&type=section&id=Forward-Looking%20Statements) The press release includes forward-looking statements that are inherently subject to significant uncertainties and contingencies - The press release contains forward-looking statements, protected by the Private Securities Litigation Reform Act of 1995, which include plans, objectives, goals, strategies, future events, or performance[4](index=4&type=chunk)[5](index=5&type=chunk) - These statements are based on various assumptions, which are inherently subject to significant uncertainties and contingencies beyond the Company's control, meaning that actual results may differ from expectations, beliefs, or projections[5](index=5&type=chunk)[7](index=7&type=chunk) [Financial Statements](index=2&type=section&id=Financial%20Statements) The company's financial statements reveal significant growth in net income and total assets, despite a net loss attributable to common shareholders due to preferred dividends [Consolidated Statements of Comprehensive (Loss)/Income](index=2&type=section&id=UNAUDITED%20CONSOLIDATED%20STATEMENTS%20OF%20COMPREHENSIVE%20(LOSS)%2FINCOME) TOP Ships Inc. reported a significant increase in net income to $18.9 million in 2022 from $8.6 million in 2021, driven by higher revenues and improved operating income. However, substantial preferred share dividends and deemed dividend equivalents resulted in a net loss attributable to common shareholders Consolidated Statements of Comprehensive (Loss)/Income (in thousands of U.S. Dollars) | Metric | 2020 | 2021 | 2022 | YoY Change (2021-2022) | | :------------------------------------------------ | :------- | :------- | :------- | :--------------------- | | Revenues | 60,222 | 56,367 | 80,656 | +43.1% | | Operating (loss)/income | (1,795) | 14,801 | 32,619 | +120.4% | | Net (loss)/income and comprehensive (loss)/income | (22,818) | 8,616 | 18,948 | +120.0% | | Net (loss) / income attributable to common shareholders | (28,780) | 5,396 | (9,187) | -270.3% | | (Loss) / Earnings per common share, basic and diluted | (24.48) | 2.71 | (3.03) | -211.8% | - The increase in net income was primarily driven by a **43.1% increase in revenues** and a **120.4% increase in operating income** year-over-year[8](index=8&type=chunk) - Despite the strong net income, significant preferred shares dividend (**$12.39 million**) and deemed dividend equivalents (**$14.40 million**) led to a net loss attributable to common shareholders of **$9,187 thousand** in 2022[8](index=8&type=chunk)[9](index=9&type=chunk) [Consolidated Condensed Balance Sheets](index=3&type=section&id=UNAUDITED%20CONSOLIDATED%20CONDENSED%20BALANCE%20SHEETS) The Company's total assets increased significantly by 41.9% to $469.3 million in 2022, primarily due to a substantial increase in vessels, net. This asset growth was supported by increases in debt and stockholders' equity Consolidated Condensed Balance Sheets (in thousands of U.S. Dollars) | Metric | December 31, 2021 | December 31, 2022 | Change | | :------------------------------------------ | :------------------ | :------------------ | :------- | | Cash and cash equivalents | 2,370 | 20,544 | +766.8% | | Vessels, net | 156,585 | 389,059 | +148.5% | | Total Assets | 330,788 | 469,337 | +41.9% | | Debt | 150,570 | 233,714 | +55.2% | | Total Liabilities | 221,424 | 272,314 | +23.0% | | Stockholders' Equity | 93,222 | 110,672 | +18.7% | - The substantial increase in 'Vessels, net' by **148.5%** from **$156,585 thousand** to **$389,059 thousand** was the primary driver for the overall asset growth[10](index=10&type=chunk) - Cash and cash equivalents saw a significant increase of **766.8%** from **$2,370 thousand** in 2021 to **$20,544 thousand** in 2022[10](index=10&type=chunk) [Non-GAAP Financial Measures](index=3&type=section&id=Non-US%20GAAP%20Measures) The company utilizes non-GAAP financial measures like EBITDA to provide additional insights into operational performance, complementing U.S. GAAP metrics [Definition and Purpose of EBITDA](index=3&type=section&id=Definition%20and%20Purpose%20of%20EBITDA) EBITDA is a non-U.S. GAAP financial measure defined as earnings before interest, taxes, depreciation, and amortization. It is used by management and investors to assess financial and operating performance by enhancing comparability across periods and companies, but it is not a substitute for U.S. GAAP measures - EBITDA is defined as earnings before interest, taxes, depreciation, and amortization, and is considered a Non-US GAAP measure[11](index=11&type=chunk) - Management and external users utilize EBITDA to assess financial and operating performance, as it increases comparability by excluding disparate effects of financing methods, capital structure, and historical cost basis[12](index=12&type=chunk)[13](index=13&type=chunk) - EBITDA is not a measure of financial performance under U.S. GAAP and should not be considered an alternative to net income, operating income, or cash flow from operating activities[14](index=14&type=chunk) [Reconciliation of Net (Loss)/Income to EBITDA](index=4&type=section&id=Reconciliation%20of%20Net%20(Loss)%20%2F%20Income%20to%20EBITDA) The reconciliation shows that EBITDA for 2022 was $46.6 million, a 100% increase from 2021, primarily driven by the higher net income and the add-back of vessel depreciation and interest and finance costs Reconciliation of Net (Loss)/Income to EBITDA (in thousands of U.S. Dollars) | Metric | 2020 | 2021 | 2022 | YoY Change (2021-2022) | | :-------------------------- | :------- | :------- | :------- | :--------------------- | | Net (loss)/income | (22,818) | 8,616 | 18,948 | +120.0% | | Add: Vessel depreciation | 13,174 | 7,670 | 13,289 | +73.3% | | Add: Interest and finance costs | 20,956 | 6,998 | 14,365 | +105.3% | | Less: Interest income | (34) | - | (48) | N/A | | **EBITDA** | **11,278** | **23,284** | **46,554** | **+100.0%** | - EBITDA doubled year-over-year from **$23,284 thousand** in 2021 to **$46,554 thousand** in 2022, reflecting strong operational performance before non-operating and non-cash items[15](index=15&type=chunk)

[FORM 6-K Filing Information](index=1&type=section&id=FORM%206-K) This section details the Form 6-K filing by TOP SHIPS INC. for September 2022, identifying it as a foreign private issuer [Filing Details](index=1&type=section&id=Filing%20Details) This document is a Form 6-K report filed by TOP SHIPS INC. for September 2022, indicating it is a foreign private issuer filing under Form 20-F * TOP SHIPS INC. filed a **Form 6-K** report for **September 2022**[1](index=1&type=chunk) * The registrant is a foreign private issuer, filing annual reports under **Form 20-F**[1](index=1&type=chunk) [Information Contained in Report](index=2&type=section&id=INFORMATION%20CONTAINED%20IN%20THIS%20FORM%206-K%20REPORT) This section outlines the report's content, including financial statements and management's discussion, which are incorporated by reference into the Company's Form F-3 registration statement [Report Content and Incorporation by Reference](index=2&type=section&id=Report%20Content%20and%20Incorporation%20by%20Reference) This Form 6-K report includes Management's Discussion and Analysis of Financial Condition and Results of Operations, along with unaudited interim condensed consolidated financial statements for the six months ended June 30, 2022. This information is incorporated by reference into the Company's Form F-3 registration statement * The report includes **Management's Discussion and Analysis of Financial Condition and Results of Operations** and unaudited interim condensed consolidated financial statements for the **six months ended June 30, 2022**[6](index=6&type=chunk) * The information is incorporated by reference into the Company's registration statement on **Form F-3** (File No. **333-267170**), effective **September 13, 2022**[7](index=7&type=chunk) [Cautionary Statement Regarding Forward-Looking Statements](index=2&type=section&id=CAUTIONARY%20STATEMENT%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) This section provides a cautionary statement on forward-looking information, highlighting various risk factors that could cause actual results to differ materially [Forward-Looking Statements and Risk Factors](index=2&type=section&id=Forward-Looking%20Statements%20and%20Risk%20Factors) This section provides a cautionary statement regarding forward-looking statements, emphasizing that actual results may differ materially due to various factors. Key risks include maintaining customer relationships, future operating results, vessel acquisitions, financial condition, industry trends, vessel aging, creditworthiness of charterers, regulatory changes, and geopolitical events * The report contains **forward-looking statements** protected by the **Private Securities Litigation Reform Act of 1995 (PSLRA)**[9](index=9&type=chunk)[10](index=10&type=chunk) * Important factors that could cause actual results to differ materially include: ability to maintain customer relationships, future operating and financial results, vessel acquisitions, financial condition and liquidity, oil and chemical tanker industry trends, vessel aging and costs, creditworthiness of charterers, governmental regulations, general economic and political conditions, and global events like the **war in Ukraine**[12](index=12&type=chunk)[14](index=14&type=chunk) * The Company undertakes no obligation to update **forward-looking statements** beyond the report date, except as required by law[13](index=13&type=chunk) [Signatures](index=4&type=section&id=SIGNATURES) This section confirms the official signing of the report by TOP SHIPS INC.'s Chief Executive Officer on September 27, 2022 [Report Authorization](index=4&type=section&id=Report%20Authorization) The report was duly signed on behalf of TOP SHIPS INC. by Evangelos J. Pistiolis, Chief Executive Officer, on September 27, 2022 * The report was signed by **Evangelos J. Pistiolis**, **Chief Executive Officer** of **TOP SHIPS INC.**, on **September 27, 2022**[15](index=15&type=chunk) [Management's Discussion and Analysis](index=5&type=section&id=MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS%20FOR%20THE%20SIX%20MONTHS%20ENDED%20JUNE%2030,%202021%20AND%202022) This section provides an in-depth analysis of the Company's financial condition and operating results for the six months ended June 30, 2021 and 2022 [Overview](index=5&type=section&id=Overview) TOP SHIPS INC. operates a fleet of modern eco tanker vessels for crude oil, petroleum products, and chemicals, with a strategic focus on accretive fleet expansion * **TOP SHIPS INC.** is an international owner and operator of modern, fuel-efficient eco tanker vessels for crude oil, petroleum products, and bulk liquid chemicals[18](index=18&type=chunk) * As of **June 30, 2022**, the fleet included **one 50,000 dwt product/chemical tanker**, **five 159,000 dwt Suezmax tankers**, **two 300,000 dwt VLCC tankers**, and **50% interests** in **two 50,000 dwt product/chemical tankers**[18](index=18&type=chunk) * The company intends to continue reviewing the market for potential accretive acquisition targets[19](index=19&type=chunk) [Non-US GAAP Measures](index=5&type=section&id=Non-US%20GAAP%20Measures) This section defines Adjusted EBITDA as a non-U.S. GAAP measure used to assess financial performance by excluding specific non-core items, emphasizing it is not a substitute for U.S. GAAP * **Adjusted EBITDA** is a **non-U.S. GAAP** measure defined as earnings before interest, taxes, depreciation and amortization, other operating loss, operating lease expenses, vessel impairments, gains on sale of vessels, and gains/losses on derivative financial instruments[21](index=21&type=chunk) * **Adjusted EBITDA** is used by management and investors to increase comparability of performance by excluding disparate effects of financing methods, capital structure, and historical cost basis[22](index=22&type=chunk) * This measure should not be considered in isolation from, as a substitute for, or superior to financial measures prepared in accordance with **U.S. GAAP**[23](index=23&type=chunk) Reconciliation of Net (Loss) / Income to Adjusted EBITDA (Six months ended June 30) | (Expressed in thousands of U.S. Dollars) | 2021 | 2022 | | :--------------------------------------- | :--- | :--- | | Net (Loss) / Income | 1,682 | 8,605 | | Add: Operating lease expenses | 5,378 | 5,378 | | Add: Vessel depreciation | 3,339 | 6,114 | | Add: Impairment on vessels | 1,160 | - | | Add: Interest and finance costs | 2,837 | 6,927 | | Add: Loss / (Gain) on financial instruments | (66) | - | | Less: Gain on sale of vessels | - | (78) | | **Adjusted EBITDA** | **14,330** | **26,946** | [Operating Results](index=6&type=section&id=A.%20Operating%20Results) The Company experienced significant growth in operating results for the six months ended June 30, 2022, driven by fleet expansion and increased revenues, despite higher finance costs Results of Operations (Six Month Period Ended June 30) | ($ in thousands) | 2021 | 2022 | Change ($) | Change (%) | | :------------------------------- | :--- | :--- | :--------- | :--------- | | Revenues | 25,310 | 38,846 | 13,536 | 53% | | Voyage expenses | 608 | 875 | 267 | 44% | | Operating lease expenses | 5,378 | 5,378 | - | 0% | | Other vessel operating expenses | 7,919 | 9,705 | 1,786 | 23% | | Vessel depreciation | 3,339 | 6,114 | 2,775 | 83% | | Management fees-related parties | 1,661 | 1,030 | (631) | -38% | | Dry-docking costs | 26 | - | (26) | -100% | | General and administrative expenses | 963 | 691 | (272) | -28% | | (Gain) on sale of vessels | - | (78) | (78) | 100% | | Impairment on vessels | 1,160 | - | (1,160) | 100% | | **Operating income** | **4,256** | **15,131** | **10,875** | **256%** | | Interest and finance costs | (2,837) | (6,927) | (4,090) | 144% | | Gain on financial instruments | 66 | - | (66) | -100% | | Equity gains in unconsolidated joint ventures | 197 | 401 | 204 | 104% | | Total other expenses, net | (2,574) | (6,526) | (3,952) | 154% | | **Net income** | **1,682** | **8,605** | **6,923** | **412%** | * Revenues, voyage expenses, depreciation, and other vessel operating expenses increased due to a **16%** increase in the average number of vessels employed (from **6.8** to **7.9**) and a **100%** increase in deadweight tonnage, driven by the delivery of **three large crude carriers**[29](index=29&type=chunk) * Management fees to related parties decreased by **$0.6 million** (**38%**) primarily due to a decrease in sale & purchase commissions, partially offset by an increase in management fees related to fleet expansion[30](index=30&type=chunk) * Interest and finance costs increased by **$4.1 million** (**144%**) mainly due to accelerated amortization of deferred financing fees, a decrease in capitalized interest (**newbuilding program completion**), and an increase in weighted average debt outstanding[31](index=31&type=chunk)[34](index=34&type=chunk) * General and administrative expenses decreased by **$0.3 million** (**28%**) due to lower legal and consulting fees, directors and officers insurance, and auditor fees[31](index=31&type=chunk) [Recent Developments](index=7&type=section&id=Recent%20Developments) Post-period events include the redemption of Series F Shares, exercise of pre-funded warrants, and a 1-for-20 reverse stock split, retroactively adjusted * On **July 5, 2022**, the Company redeemed **865,558 Series F Shares**, paying **$10.4 million** to **Africanus Inc.**[32](index=32&type=chunk) * In **July and September 2022**, a total of **9,603,000 pre-funded warrants** were exercised for **480,150 common shares**[32](index=32&type=chunk) * On **September 23, 2022**, a **1-for-20 reverse stock split** of common stock was effected, with all related share and EPS amounts retroactively adjusted[33](index=33&type=chunk) [Liquidity and Capital Resources](index=8&type=section&id=B.%20Liquidity%20and%20Capital%20Resources) The Company's liquidity is primarily supported by equity offerings, operating cash flow, and borrowings, with management expecting to finance operations for the next 12 months despite a working capital deficit * Principal funding sources include equity offerings, operating cash flow, and long/short-term borrowings, primarily used for fleet growth and maintenance[35](index=35&type=chunk) * As of **June 30, 2022**, total indebtedness was **$244.5 million**, and **cash and cash equivalents** were **$18.3 million** (including **$4.0 million** restricted cash)[37](index=37&type=chunk) * The Company had a **working capital deficit** of **$18.4 million** as of **June 30, 2022**[38](index=38&type=chunk) * Management expects to finance the **working capital deficit** and obligations for the next **12 months** with cash on hand and operational cash flow[40](index=40&type=chunk) Cash Flow Information (Six months ended June 30) | Cash Flow Category | 2021 ($ thousands) | 2022 ($ thousands) | | :--------------------------------- | :----------------- | :----------------- | | Net Cash provided by Operating Activities | 9,347 | 13,947 | | Net Cash used in Investing Activities | (90,830) | (143,050) | | Net Cash provided by Financing Activities | 70,548 | 141,000 | | Net (decrease)/increase in cash and cash equivalents and restricted cash | (10,935) | 11,897 | | Cash and cash equivalents and restricted cash at end of the period | 12,393 | 18,267 | [Index to Condensed Consolidated Financial Statements](index=9&type=section&id=INDEX%20TO%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section provides an index to the unaudited interim condensed consolidated financial statements, including balance sheets, income statements, equity statements, cash flows, and notes [Financial Statement Listing](index=9&type=section&id=Financial%20Statement%20Listing) This section provides an index to the unaudited interim condensed consolidated financial statements, including the Balance Sheets, Statements of Comprehensive Income/(Loss), Statements of Mezzanine and Stockholders' Equity, Statements of Cash Flows, and accompanying Notes * The index lists the **Unaudited Interim Condensed Consolidated Balance Sheets**, **Statements of Comprehensive Income/(Loss)**, **Statements of Mezzanine and Stockholders' Equity**, **Statements of Cash Flows**, and **Notes to Unaudited Interim Condensed Consolidated Financial Statements**[48](index=48&type=chunk) [Unaudited Interim Condensed Consolidated Financial Statements](index=10&type=section&id=UNAUDITED%20INTERIM%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section presents the Company's unaudited interim condensed consolidated financial statements, offering a snapshot of its financial position, performance, and cash flows [Unaudited Interim Condensed Consolidated Balance Sheets](index=10&type=section&id=UNAUDITED%20INTERIM%20CONDENSED%20CONSOLIDATED%20BALANCE%20SHEETS) The balance sheet shows a significant increase in total assets from $330.8 million at December 31, 2021, to $475.4 million at June 30, 2022, primarily driven by an increase in vessels, net. Total liabilities also increased from $221.4 million to $284.3 million, while total stockholders' equity decreased from $93.2 million to $88.6 million Key Balance Sheet Data (as of December 31, 2021 and June 30, 2022) | Category | December 31, 2021 ($ thousands) | June 30, 2022 ($ thousands) | | :------------------------ | :------------------------------ | :-------------------------- | | Total current assets | 75,334 | 16,557 | | Total fixed assets | 224,977 | 429,822 | | Total non-current assets | 30,477 | 29,027 | | **Total assets** | **330,788** | **475,406** | | Total current liabilities | 107,088 | 34,946 | | Total non-current liabilities | 114,336 | 249,326 | | **Total liabilities** | **221,424** | **284,272** | | Total mezzanine equity | 16,142 | 102,542 | | **Total stockholders' equity** | **93,222** | **88,592** | * **Vessels, net** increased significantly from **$156.6 million** to **$396.2 million**, reflecting new vessel deliveries[49](index=49&type=chunk) * **Cash and cash equivalents** increased from **$2.4 million** to **$14.3 million**[49](index=49&type=chunk) [Unaudited Interim Condensed Consolidated Statements of Comprehensive Income/(Loss)](index=11&type=section&id=UNAUDITED%20INTERIM%20CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20COMPREHENSIVE%20INCOME/(LOSS)) The Company reported a substantial increase in total revenues to $38.8 million for the six months ended June 30, 2022, up from $25.3 million in the prior year. Net income also significantly improved to $8.6 million from $1.7 million. However, due to deemed dividend equivalents on Series F Shares and preferred share dividends, net income attributable to common shareholders resulted in a loss of $13.1 million, leading to a basic and diluted loss per common share of $6.15 Key Comprehensive Income Data (Six Months Ended June 30) | Category | 2021 ($ thousands) | 2022 ($ thousands) | | :---------------------------------------------- | :----------------- | :----------------- | | Total revenues | 25,310 | 38,846 | | Operating income | 4,256 | 15,131 | | Net income and comprehensive income | 1,682 | 8,605 | | Less: Deemed dividend equivalents on Series F Shares related to redemption value | - | (14,400) | | Less: Dividends of preferred shares | (915) | (7,322) | | Net income/(loss) and comprehensive income/(loss) attributable to common shareholders | 767 | (13,117) | | Earnings/(Loss) per common share, basic and diluted | 0.39 | (6.15) | | Weighted average common shares outstanding, basic and diluted | 1,991,598 | 2,132,179 | * **Total revenues** increased by **53.5%** year-over-year, from **$25.3 million** in **2021** to **$38.8 million** in **2022**[50](index=50&type=chunk) * **Operating income** increased by **255.5%** year-over-year, from **$4.3 million** in **2021** to **$15.1 million** in **2022**[50](index=50&type=chunk) * **Net income attributable to common shareholders** turned into a **loss of $13.1 million** in **2022**, primarily due to **$14.4 million** in **deemed dividend equivalents on Series F Shares** and **$7.3 million** in preferred share dividends[50](index=50&type=chunk) [Unaudited Interim Condensed Consolidated Statements of Mezzanine and Stockholders' Equity](index=12&type=section&id=UNAUDITED%20INTERIM%20CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20MEZZANINE%20AND%20STOCKHOLDERS'%20EQUITY) The statement shows changes in mezzanine and stockholders' equity, with total mezzanine equity increasing significantly from $16.1 million at December 31, 2021, to $102.5 million at June 30, 2022, mainly due to the issuance of Series F Shares. Total stockholders' equity decreased from $93.2 million to $88.6 million, impacted by net income, equity offerings, and preferred share dividends * **Total mezzanine equity** increased from **$16.1 million** at **December 31, 2021**, to **$102.5 million** at **June 30, 2022**, driven by the issuance of **7,200,000 Series F Shares**[51](index=51&type=chunk) * **Total stockholders' equity** decreased from **$93.2 million** to **$88.6 million**, reflecting **net income**, issuance of common stock and **pre-funded warrants**, and dividends to preferred shares[51](index=51&type=chunk) * **Deemed dividend equivalents on Series F Shares** related to redemption value amounted to **$14.4 million** for the **six months ended June 30, 2022**[51](index=51&type=chunk) [Unaudited Interim Condensed Consolidated Statements of Cash Flows](index=13&type=section&id=UNAUDITED%20INTERIM%20CONDENSED%20CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) Net cash provided by operating activities increased to $13.9 million for the six months ended June 30, 2022, from $9.3 million in the prior year. Investing activities used $143.1 million, primarily for vessel construction advances, partially offset by vessel sales proceeds. Financing activities provided $141.0 million, mainly from long-term debt proceeds and Series F preferred stock issuance, leading to a net increase in cash and cash equivalents and restricted cash of $11.9 million Key Cash Flow Data (Six months ended June 30) | Cash Flow Category | 2021 ($ thousands) | 2022 ($ thousands) | | :----------------------------------------------- | :----------------- | :----------------- | | Net Cash provided by Operating Activities | 9,347 | 13,947 | | Net Cash used in Investing Activities | (90,830) | (143,050) | | Net Cash provided by Financing Activities | 70,548 | 141,000 | | Net (decrease)/increase in cash and cash equivalents and restricted cash | (10,935) | 11,897 | | Cash and cash equivalents and restricted cash at end of the period | 12,393 | 18,267 | * Cash used in investing activities increased from **$90.8 million** in **2021** to **$143.1 million** in **2022**, primarily due to **$216.6 million** in advances for vessels under construction, partially offset by **$72.1 million** from vessel sales[43](index=43&type=chunk)[52](index=52&type=chunk) * Cash provided by financing activities increased from **$70.5 million** in **2021** to **$141.0 million** in **2022**, driven by **$156.2 million** from **long-term debt** and **$47.6 million** from **Series F preferred stock issuance**[44](index=44&type=chunk)[52](index=52&type=chunk) [Notes to Unaudited Interim Condensed Consolidated Financial Statements](index=14&type=section&id=NOTES%20TO%20UNAUDITED%20INTERIM%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section provides detailed notes explaining the basis of presentation, significant accounting policies, going concern assessment, and specifics of financial statement line items [1. Basis of Presentation and General Information](index=14&type=section&id=1.%20Basis%20of%20Presentation%20and%20General%20Information) This note outlines the Company's business, confirms U.S. GAAP compliance for interim statements, details a retroactive stock split, and addresses the Russia-Ukraine war's potential impact * **TOP SHIPS INC.** is an international provider of worldwide oil, petroleum products, and bulk liquid chemicals transportation services[54](index=54&type=chunk) * The financial statements are prepared in accordance with **U.S. GAAP** for interim financial information and should be read in conjunction with the Company's **Annual Report on Form 20-F** for **2021**[58](index=58&type=chunk) * A **1-for-20 reverse stock split** of common stock was effected on **September 23, 2022**, with all common share and EPS amounts retroactively adjusted[62](index=62&type=chunk) * The Company has not identified any apparent consequences on its business from the **Russia-Ukraine war** and related sanctions to date, but acknowledges potential adverse effects in the future[61](index=61&type=chunk) [2. Significant Accounting Policies](index=15&type=section&id=2.%20Significant%20Accounting%20Policies) This note confirms no changes to significant accounting policies for the period and the adoption of ASU 2020-06 with no material effect on interim financial statements * No changes to significant accounting policies occurred in the **six months ended June 30, 2022**[63](index=63&type=chunk) * The Company adopted **ASU 2020-06** on **January 1, 2022**, using the modified retrospective approach, with no effect on the interim financial statements[64](index=64&type=chunk) [3. Going Concern](index=15&type=section&id=3.%20Going%20Concern) Despite a working capital deficit, management believes the Company can finance its obligations for the next 12 months through cash on hand and operational cash flow, supporting a going concern basis * At **June 30, 2022**, the Company had a **working capital deficit** of **$18.4 million**[65](index=65&type=chunk) * For the **six months ended June 30, 2022**, the Company realized a **net income** of **$8.6 million** and generated **cash flow from operations** of **$13.9 million**[65](index=65&type=chunk) * Management believes it has the ability to continue as a **going concern** and finance its obligations over the next **twelve months** using cash on hand and operational cash flow[66](index=66&type=chunk) [4(a). Vessels, net](index=16&type=section&id=4(a).%20Vessels,%20net) The net book value of vessels significantly increased due to new vessel deliveries, with two vessels previously held for sale being sold for a gain Vessels, net (Balances) | | Vessel Cost ($ thousands) | Accumulated Depreciation ($ thousands) | Net Book Value ($ thousands) | | :--------------------------------------- | :------------------------ | :----------------------------- | :--------------------------- | | Balance, December 31, 2021 | 163,501 | (6,916) | 156,585 | | — Transferred from advances for vessels under construction | 245,763 | - | 245,763 | | — Depreciation | - | (6,114) | (6,114) | | **Balance, June 30, 2022** | **409,264** | **(13,030)** | **396,234** | * **Two vessels** (M/T's Eco Los Angeles and Eco City of Angels) held for sale were sold in **February and March 2022**, resulting in a **gain** of **$78 thousand**[68](index=68&type=chunk) * Vessel titles are transferred to financing banks or mortgaged as security under loan facilities[69](index=69&type=chunk) [4(b). Advances for vessels acquisitions / under construction](index=16&type=section&id=4(b).%20Advances%20for%20vessels%20acquisitions%20/%20under%20construction) Advances for vessels acquisitions/under construction decreased from $30.6 million at December 31, 2021, to zero at June 30, 2022. This change reflects $213.4 million in new advances paid and $1.8 million in capitalized expenses, offset by $245.8 million transferred to 'Vessels, net' upon the delivery of M/T Julius Caesar, M/T Legio X Equestris, and M/T Eco Oceano Ca in Q1 2022 Advances for vessels acquisitions / under construction (Balances) | | Advances for vessels acquisitions/under construction ($ thousands) | | :--------------------------------------- | :------------------------------------------------- | | Balance, December 31, 2021 | 30,579 | | — Advances paid | 213,429 | | — Capitalized expenses | 1,755 | | — Transferred to Vessels, net | (245,763) | | **Balance, June 30, 2022** | **-** | * The Company took delivery of **M/T Julius Caesar**, **M/T Legio X Equestris**, and **M/T Eco Oceano Ca** in **January and March 2022**, leading to the transfer of related advances to '**Vessels, net**'[70](index=70&type=chunk) [5. Transactions with Related Parties](index=16&type=section&id=5.%20Transactions%20with%20Related%20Parties) The Company engages in various transactions with related parties, including Central Mare for executive officers and administrative employees, Central Shipping Inc. (CSI) for fleet management services, Family Trading Inc. for Series E Share dividends, Africanus Inc. for Series F Share issuance and dividends, and Central Tankers Chartering Inc. (CTC) for time charters. These transactions involve management fees, commissions, dividends, and a short-term bridge loan, with some agreements amended to reflect current market conditions and fleet changes * **Central Mare** provides executive officers and administrative employees, with expenses of **$163 thousand** in **2021** and **$164 thousand** in **2022**[71](index=71&type=chunk) * **CSI** provides fleet management services, with total fees and expenses of **$3.2 million** in **2021** and **$3.2 million** in **2022**, including management fees, supervision services, accounting costs, and commissions[72](index=72&type=chunk) * Dividends declared to **Family Trading Inc.** for **Series E Shares** were **$1,015 thousand** for the **six months ended June 30, 2022**[73](index=73&type=chunk) * Dividends declared to **Africanus Inc.** for **Series F Shares** were **$6,307 thousand** for the period **January 17, 2022**, through **June 30, 2022**[73](index=73&type=chunk) * A time charter agreement with **CTC** for **M/T Eco Oceano Ca** was amended in **February 2022**, extending the firm period to **15 years** and reducing the daily rate from **$32,450** to **$24,500**, generating **$2.8 million** in revenue for the **six months ended June 30, 2022**[73](index=73&type=chunk) * The **Central Mare Bridge Loan**, an unsecured credit facility for up to **$20 million**, was entered into on **January 5, 2022**, drawn down by **$9 million**, and subsequently prepaid and terminated on **March 4, 2022**[73](index=73&type=chunk) [6. Leases](index=18&type=section&id=6.%20Leases) This note details future minimum operating lease payments for chartered-in vessels and future minimum time-charter receipts as a lessor, outlining the Company's lease obligations and revenues Future Minimum Operating Lease Payments (after June 30, 2022) | Year ending December 31, | Bareboat charter lease payments ($ thousands) | | :----------------------- | :-------------------------------------------- | | 2022 (remainder) | 6,021 | | 2023 | 10,220 | | 2024 | 10,038 | | 2025 | 6,777 | | **Total** | **33,056** | | Less imputed interest | (4,201) | | **Total Lease Liability**| **28,855** | | Presented as: Short-term lease liability | 9,213 | | Presented as: Long-term lease liability | 19,642 | * The average remaining lease term for chartered-in contracts greater than **12 months** is **41.2 months**[75](index=75&type=chunk) * Bareboat chartered-in vessels generated **$8.8 million** in revenue for the **six months ended June 30, 2022**[75](index=75&type=chunk) Future Minimum Time-Charter Receipts (as of June 30, 2022) | Year ending December 31, | Time Charter receipts ($ thousands) | | :----------------------- | :---------------------------------- | | 2022 (remaining) | 41,814 | | 2023 | 81,772 | | 2024 | 44,525 | | 2025 | 11,879 | | 2026 to 2037 | 98,545 | | **Total** | **278,535** | [7. Debt](index=19&type=section&id=7.%20Debt) Total long-term debt significantly increased due to new facilities for vessel acquisitions, with the Company remaining in compliance with all debt covenants Total Long Term Debt Net of Deferred Finance Fees | Category | December 31, 2021 ($ thousands) | June 30, 2022 ($ thousands) | | :-------------------------------------- | :------------------------------ | :-------------------------- | | Total long term debt | 98,650 | 248,432 | | Less: Deferred finance fees | (1,282) | (3,974) | | **Total long term debt net of deferred finance fees** | **97,368** | **244,458** | | Debt related to Vessels held for sale net of deferred finance fees | 53,202 | - | | **Total Debt net of deferred finance fees** | **150,570** | **244,458** | * The Company was in **compliance with all debt covenants** as of **June 30, 2022**[81](index=81&type=chunk) * A **$48.2 million 2nd AVIC Sale and Leaseback Facility** was entered into on **March 2, 2022**, for **M/T Eco Oceano Ca**, accounted for as a financing transaction[82](index=82&type=chunk)[85](index=85&type=chunk) * The **2nd AVIC Facility** includes customary covenants, cross-default provisions, and performance requirements such as an asset cover ratio of **120%** and minimum free liquidity of **$500 per vessel**[86](index=86&type=chunk) * The **Central Mare Bridge Loan**, an unsecured credit facility of up to **$20 million**, was prepaid and terminated on **March 4, 2022**[87](index=87&type=chunk) [8. Commitments and Contingencies](index=20&type=section&id=8.%20Commitments%20and%20Contingencies) The Company is subject to routine claims and suits in its shipping business but is not involved in any material litigation or aware of significant environmental liabilities * The Company is subject to various claims, suits, and complaints, including those involving government regulations and product liability, arising in the ordinary course of business[88](index=88&type=chunk) * The Company is not a party to any material litigation where claims or counterclaims have been filed against it, other than routine legal proceedings[89](index=89&type=chunk) * Management is not aware of any environmental liabilities that should be disclosed or for which a provision should be established[90](index=90&type=chunk) [9. Common Stock, Additional Paid-In Capital and Dividends](index=21&type=section&id=9.%20Common%20Stock,%20Additional%20Paid-In%20Capital%20and%20Dividends) This note details the issuance of Series F Preferred Shares, ATM offerings, and a Registered Direct Offering, impacting common stock and paid-in capital, with no common stock dividends paid * **7,200,000 Series F Preferred Shares** were issued to **Africanus Inc.** for **$47.6 million** in shipbuilding costs and **$24.4 million** in settlement of Due to related parties[93](index=93&type=chunk) * **Series F Preferred Shares** holders are entitled to **ten common share votes per share**, semi-annual cash dividends at **13.5% per year**, and a one-time **4.0% cash dividend** upon issuance[93](index=93&type=chunk) * The Company entered into an **At-The-Market (ATM) offering** agreement with **Maxim Group LLC**, selling common stock and receiving **$2.0 million** in net proceeds as of **June 30, 2022**[94](index=94&type=chunk) * A **June 2022 Registered Direct Offering** resulted in the sale of **235,000 common shares** and the issuance of **9,603,000 pre-funded warrants** and **14,303,000 private placement warrants**[95](index=95&type=chunk) * **Pre-Funded Warrants** are equity-classified, immediately exercisable for a negligible cash consideration, and were included in the weighted average common shares outstanding for EPS calculation[100](index=100&type=chunk)[103](index=103&type=chunk) * **June 2022 Private Placement Warrants** were equity-classified and initially measured at fair value using the **Black-Scholes methodology** (**Level 3 fair value hierarchy**)[97](index=97&type=chunk)[98](index=98&type=chunk) * No dividends were paid to common stock holders in the **six months ended June 30, 2021 and 2022**[101](index=101&type=chunk) [10. Earnings / (Loss) Per Common Share](index=22&type=section&id=10.%20Earnings%20/%20(Loss)%20Per%20Common%20Share) For the six months ended June 30, 2022, the Company reported a basic and diluted loss per common share of $6.15, compared to earnings of $0.39 in the prior year. This shift was primarily due to $14.4 million in deemed dividend equivalents on Series F Shares and $7.3 million in preferred share dividends, which resulted in a net loss attributable to common shareholders of $13.1 million. Certain securities, including June 2022 Private Placement Warrants and Series E Shares, were excluded from diluted EPS calculation as their inclusion would have been antidilutive Earnings / (Loss) Per Common Share (Six months ended June 30) | Category | 2021 ($ thousands) | 2022 ($ thousands) | | :---------------------------------------------- | :----------------- | :----------------- | | Net Income | 1,682 | 8,605 | | Less: Dividends of Preferred shares | (915) | (7,322) | | Less: Deemed dividend equivalents on Series F Shares related to redemption value | - | (14,400) | | **Gain / (loss) attributable to common shareholders** | **767** | **(13,117)** | | Weighted average common shares outstanding, basic | 1,991,598 | 2,132,179 | | **Earnings / (loss) per share, basic and diluted** | **0.39** | **(6.15)** | * The weighted average number of common shares outstanding for basic and diluted EPS in **2022** includes **Pre-Funded Warrants** due to their immediate exercisability for negligible cash[103](index=103&type=chunk) Potentially Dilutive Securities Excluded from EPS Calculation (Six months ended June 30) | Security | 2021 | 2022 | | :-------------------------------------- | :--- | :--- | | June 2022 Private Placement Warrants | - | 282,740 | | Series E Shares | 599,148 | 974,782 | | **Potentially dilutive securities** | **599,148** | **1,257,522** | [11. Fair value of Financial Instruments and derivative instruments](index=23&type=section&id=11.%20Fair%20value%20of%20Financial%20Instruments%20and%20derivative%20instruments) This note describes the fair value classification of financial instruments, interest rate risk on floating-rate debt, and credit risk management practices * Principal financial assets include cash, restricted cash, deposit assets, and receivables; principal financial liabilities include long-term loans, accounts payable, and amounts due to related parties[107](index=107&type=chunk) * **Cash and cash equivalents** and restricted cash are considered **Level 1** items in the fair value hierarchy[108](index=108&type=chunk) * The fair value of variable interest **long-term debt** approximates recorded values, while fixed interest debt is estimated using prevailing market rates, classifying it as **Level 2**[109](index=109&type=chunk) * The Company is subject to interest rate risk on its floating-rate debt (**LIBOR** plus margin) but has not entered into rate swap agreements as of **June 30, 2022**[113](index=113&type=chunk) * Credit risk is managed by placing temporary cash investments with high-credit-qualified financial institutions[113](index=113&type=chunk) [12. Mezzanine Equity](index=23&type=section&id=12.%20Mezzanine%20Equity) This note details the Company's mezzanine equity, comprising Series E and Series F Shares. No Series E Shares were issued or redeemed during the period, with 13,452 shares outstanding. 7,200,000 Series F Preferred Shares were issued to Africanus Inc., classified as mezzanine equity due to their equity-like nature. The carrying value of Series F Shares was adjusted to their maximum redemption amount, resulting in a $14.4 million deemed dividend * As of **June 30, 2022**, **13,452 Series E Shares** were outstanding, convertible into **1,121,000 common shares** at a conversion price of **$12.00**[111](index=111&type=chunk) * The Company declared **$1,015 thousand** in dividends to **Series E Shares** holders for the **six months ended June 30, 2022**[111](index=111&type=chunk) * **7,200,000 Series F Preferred Shares** were issued to **Africanus Inc.**, classified as **mezzanine equity**, not subject to holder redemption or conversion[112](index=112&type=chunk) * The carrying value of **Series F Shares** was adjusted to the maximum redemption amount (**$86.4 million**), resulting in a **$14.4 million deemed dividend**[112](index=112&type=chunk) [13. Subsequent Events](index=24&type=section&id=13.%20Subsequent%20Events) Subsequent to June 30, 2022, the Company redeemed 865,558 Series F Shares for $10.4 million, including a $1.7 million redemption premium classified as a deemed dividend. Additionally, 9,603,000 pre-funded warrants were exercised in July and September 2022, resulting in the issuance of 480,150 common shares * On **July 5, 2022**, the Company redeemed **865,558 Series F Shares**, paying **$10.4 million** to **Africanus Inc.**, which included a **$1.7 million redemption premium** classified as a **deemed dividend**[114](index=114&type=chunk) * In **July and September 2022**, **9,603,000 pre-funded warrants** were exercised for a total of **480,150 common shares**[115](index=115&type=chunk)

Financial Performance - Total revenues for 2021 were $56,367,000, a decrease of 6% compared to $60,222,000 in 2020[309] - Time charter equivalent revenues for 2021 were $55,050, down from $58,228 in 2020[309] - Total charter revenues decreased by $3.9 million, or 6%, from $60.2 million in 2020 to $56.4 million in 2021[324] - Net income improved by $31.4 million, from a net loss of $22.8 million in 2020 to a net income of $8.6 million in 2021[324] Fleet and Operations - Average daily time charter equivalent (TCE) increased to $22,020 in 2021, up 27% from $17,314 in 2020[307] - Fleet utilization for 2021 was 96.93%, down from 97.68% in 2020[307] - Total operating days for the fleet in 2021 were 2,500, a decrease from 3,363 in 2020[309] - The average number of vessels employed decreased from 9.5 in 2020 to 7.1 in 2021, impacting revenues and expenses[325] - Total number of vessels at the end of 2021 was 7, consistent with 2020[307] Expenses - Vessel operating expenses for 2021 were $6,070 per day, slightly up from $6,037 in 2020[307] - General and administrative expenses increased to $752,000 in 2021 from $555,000 in 2020[307] - Operating lease expenses increased significantly by $10.1 million, or 1,336%, due to new operating leases starting in late 2020[326] - Vessel operating expenses decreased by $5.3 million, or 25%, from $21.0 million in 2020 to $15.7 million in 2021[324] Debt and Financing - As of December 31, 2021, total indebtedness was $153.3 million, with cash commitments for fleet acquisition totaling $213.4 million[341] - Net cash provided by financing activities for the period ended December 31, 2021 was $43.6 million, consisting of $74.8 million from long-term debt proceeds, offset by $28.3 million in principal payments and $1.8 million in dividends[351] - Total indebtedness as of December 31, 2021 was $153.3 million, with $81.9 million related to Cargill and AVIC sale and leaseback facilities[547] - The company entered into a new credit facility with ABN Amro for $36.8 million on March 18, 2021, with a repayment structure of 24 quarterly installments[355] Cash Flow - Cash and cash equivalents decreased from $23.3 million in 2020 to $6.4 million in 2021[345] - Net cash provided by operating activities increased by $10.1 million, or 168%, to $16.1 million in 2021[346] Impairments and Charges - Vessels impairment charges increased by $1.2 million, or 100%, due to a write-down of a vessel held for sale[331] - The company recognized an impairment charge of $1.2 million for the M/T Nord Valiant, which was sold for $26.4 million[373] Compliance and Risk - The company was in compliance with all covenants related to bank loans and sale and leaseback agreements as of December 31, 2021[360] - A hypothetical one percentage point increase in the three-month U.S. dollar LIBOR would increase interest rate expense for 2022 by approximately $0.7 million[548] - Approximately 96.5% of the company's expenses were in U.S. dollars, with 3.1% in Euros and 0.4% in other currencies during 2021[549] - A 5% decrease in the exchange rate from $1.1419 to $1.0848 would result in an expense saving of approximately $0.09 million[551] - An inverse 5% change in the exchange rate would lead to an equivalent additional expense of $0.09 million[551] Future Outlook - Future performance is uncertain and depends on charter rates at the expiration of current vessel employments[305]

[Full Year 2021 Financial and Operational Highlights](index=1&type=section&id=Full%20Year%202021%20Financial%20and%20Operational%20Highlights) TOP Ships Inc. achieved record net income and strong adjusted EBITDA in FY2021, alongside significant operational advancements and a robust charter backlog [Financial Performance Summary (FY2021)](index=1&type=section&id=Financial%20Performance%20Summary%20%28FY2021%29) TOP Ships Inc. achieved its highest net income since 2008 in FY2021, alongside strong adjusted EBITDA and increased total assets - Record **net income** for the year ended December 31, 2021, the highest since 2008[1](index=1&type=chunk) Financial Metrics (in millions of U.S. Dollars, except EPS) | Metric | Value | | :----------------- | :---------- | | Total Revenues | $56.4 million | | Net Income | $8.6 million | | Earnings per share | $0.14 | | Adjusted EBITDA | $35.2 million | | Total Assets | $330.8 million | [Operational Developments](index=1&type=section&id=Operational%20Developments) The company concluded its newbuilding program, successfully sold the M/T Eco Los Angeles and repaid associated debt, and took delivery of the M/T Eco Oceano Ca, which immediately commenced a long-term time charter - Conclusion of the newbuilding program[1](index=1&type=chunk) - Sale of M/T Eco Los Angeles to an unaffiliated party; net proceeds used to repay **$9 million** of funds drawn under an unsecured credit facility[2](index=2&type=chunk) - Delivery of the 157,000 dwt newbuilding Suezmax tanker M/T Eco Oceano Ca, followed by a sale and leaseback for **$48.2 million** and commencement of a fifteen-year time charter employment[3](index=3&type=chunk) [Fleet Status and Charter Backlog](index=1&type=section&id=Fleet%20Status%20and%20Charter%20Backlog) As of March 14, 2022, TOP Ships Inc. reported a substantial fixed revenue backlog and high charter coverage for the upcoming years, ensuring revenue visibility - Fixed revenue backlog of approximately **$361 million**[1](index=1&type=chunk) Time Charter Coverage | Year | Time Charter Coverage | | :--- | :-------------------- | | 2022 | 100% | | 2023 | 100% | | 2024 | 76% | | 2025 | 17% | | 2026+ | 10% | [About TOP Ships Inc.](index=1&type=section&id=About%20TOP%20Ships%20Inc.) TOP Ships Inc. is an international owner and operator of modern, fuel-efficient 'ECO' tanker vessels, with a specified number of outstanding preferred shares [Company Profile](index=1&type=section&id=Company%20Profile) TOP Ships Inc. is an international ship-owning company specializing in modern, fuel-efficient 'ECO' tanker vessels - TOP Ships Inc. is an international owner and operator of modern, fuel efficient 'ECO' tanker vessels[1](index=1&type=chunk)[5](index=5&type=chunk) [Outstanding Shares](index=1&type=section&id=Outstanding%20Shares) As of the earnings release date, the company had 4,763,000 Series F Preferred Shares issued and outstanding - **4,763,000 Series F Preferred Shares** issued and outstanding as of the earnings release date[4](index=4&type=chunk) [Unaudited Consolidated Financial Statements](index=2&type=section&id=Unaudited%20Consolidated%20Financial%20Statements) The unaudited consolidated financial statements present the company's comprehensive income, balance sheet, and cash flow, highlighting a significant financial turnaround in 2021 [Consolidated Statements of Comprehensive (Loss)/Income](index=2&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20%28Loss%29%2FIncome) The company demonstrated a significant financial turnaround in 2021, moving from net losses in prior years to a net income, primarily driven by improved operating income and substantially reduced interest and finance costs Net (Loss) / Income (in thousands of U.S. Dollars) | Year | Amount | | :--- | :------- | | 2019 | (14,773) | | 2020 | (22,818) | | 2021 | 8,616 | Revenues (in thousands of U.S. Dollars) | Year | Amount | | :--- | :------- | | 2019 | 66,088 | | 2020 | 60,222 | | 2021 | 56,367 | Operating Income/(Loss) (in thousands of U.S. Dollars) | Year | Amount | | :--- | :------- | | 2019 | 3,936 | | 2020 | (1,795) | | 2021 | 14,801 | Interest and Finance Costs (in thousands of U.S. Dollars) | Year | Amount | | :--- | :------- | | 2019 | (18,077) | | 2020 | (20,956) | | 2021 | (6,998) | [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) The balance sheet shows an increase in total assets in 2021, primarily driven by growth in vessels held for sale and vessels, net, while total liabilities also increased significantly, largely due to debt associated with vessels held for sale and an overall rise in current liabilities Total Assets (in thousands of U.S. Dollars) | Year | Amount | | :--- | :------- | | 2020 | 293,032 | | 2021 | 330,788 | Total Liabilities (in thousands of U.S. Dollars) | Year | Amount | | :--- | :------- | | 2020 | 158,814 | | 2021 | 221,424 | Vessels Held for Sale (in thousands of U.S. Dollars) | Year | Amount | | :--- | :------- | | 2020 | 24,340 | | 2021 | 71,636 | Debt Related to Vessels Held for Sale (in thousands of U.S. Dollars) | Year | Amount | | :--- | :------- | | 2020 | - | | 2021 | 53,202 | Total Stockholders' Equity (in thousands of U.S. Dollars) | Year | Amount | | :--- | :------- | | 2020 | 120,701 | | 2021 | 93,222 | [Non-US GAAP Measures](index=4&type=section&id=Non-US%20GAAP%20Measures) This section defines and reconciles Adjusted EBITDA, a non-U.S. GAAP financial measure used to evaluate the company's financial and operating performance [Adjusted EBITDA Definition and Purpose](index=4&type=section&id=Adjusted%20EBITDA%20Definition%20and%20Purpose) Adjusted EBITDA is a non-U.S. GAAP financial measure utilized by management and external users to evaluate the company's financial and operating performance, aiming to enhance comparability across periods by excluding certain non-core or non-cash items - Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization, other operating loss, operating lease expenses, vessel impairments, gains on sale of vessels and gains/losses on derivative financial instruments[14](index=14&type=chunk)[15](index=15&type=chunk) - It is used as a supplemental financial measure to assess financial and operating performance and increase comparability from period to period by excluding items affected by financing methods, capital structure, and historical cost basis[16](index=16&type=chunk) - This non-U.S. GAAP measure should not be considered in isolation from, as a substitute for, or superior to financial measures prepared in accordance with U.S. GAAP[17](index=17&type=chunk) [Adjusted EBITDA Reconciliation](index=5&type=section&id=Adjusted%20EBITDA%20Reconciliation) The provided reconciliation details the adjustments made to Net (loss)/income to arrive at Adjusted EBITDA for the years 2019, 2020, and 2021, offering transparency into the calculation of this non-GAAP metric Adjusted EBITDA (in thousands of U.S. Dollars) | Year | Adjusted EBITDA | | :--- | :-------------- | | 2019 | 36,470 | | 2020 | 30,002 | | 2021 | 35,218 | - Key adjustments include adding back operating lease expense, vessel depreciation, impairment on vessel, interest and finance costs, and adjusting for derivative financial instruments and other operating items[18](index=18&type=chunk) [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) This section provides a safe harbor statement for forward-looking information, outlining the inherent uncertainties and risks associated with such statements [Safe Harbor Statement](index=2&type=section&id=Safe%20Harbor%20Statement) This section includes a safe harbor statement, in accordance with the Private Securities Litigation Reform Act of 1995, to protect forward-looking statements, emphasizing that such statements are based on assumptions and are inherently subject to significant uncertainties and contingencies that may cause actual results to differ - Matters discussed may constitute forward-looking statements, protected by the Private Securities Litigation Reform Act of 1995[8](index=8&type=chunk) - Forward-looking statements are identified by words such as 'believe,' 'anticipate,' 'intends,' 'estimate,' 'forecast,' 'project,' 'plan,' 'potential,' 'may,' 'should,' 'expect,' 'pending' and similar expressions[9](index=9&type=chunk) - These statements are based on assumptions that are inherently subject to significant uncertainties and contingencies, and there is no assurance that expectations, beliefs, or projections will be achieved[9](index=9&type=chunk)

Fleet and Operations - As of June 30, 2021, the fleet consisted of four 50,000 dwt product/chemical tankers and four 159,000 dwt Suezmax tankers, with newbuilding contracts for a scrubber-fitted 157,000 dwt Suezmax tanker and two 300,000 dwt tankers [21]. - The fleet includes 50% interests in two additional 50,000 dwt product/chemical tankers [21]. - The company has established a reputation for operating vessels with high standards of performance, reliability, and safety [23]. - The company purchased an additional 65% ownership interest in two VLCC companies for $29.8 million, becoming a 100% owner [44]. - The company has a time charter for the M/T Eco Oceano Ca at a gross daily rate of $32,450 for five years, with options to extend [87]. - The company transferred $126,646 from advances for vessels under construction to vessels, net, reflecting the delivery of new vessels [96]. Financial Performance - For the six months ended June 30, 2021, revenues decreased by $7.3 million, or 22%, to $25.3 million compared to $32.6 million in the same period of 2020 [36]. - Net income for the six months ended June 30, 2021, was $1.7 million, a significant improvement of $4.6 million compared to a net loss of $2.9 million in the same period of 2020, representing a 159% increase [36]. - Adjusted EBITDA for the six months ended June 30, 2021, was $14.3 million, slightly down from $14.4 million in the same period of 2020 [33]. - The company reported operating income of $4,256 thousand for the six months ended June 30, 2021, down from $8,335 thousand in the same period of 2020, a decrease of 48.9% [68]. - For the six months ended June 30, 2021, total management fees charged by CSI amounted to $99, compared to $31 in the same period of 2020, reflecting a significant increase of 219% [101]. - The company reported a net cash used in investing activities of $90,830,000 for the six months ended June 30, 2021 [73]. Impact of COVID-19 - The ongoing COVID-19 pandemic has led to low charter rates, particularly for vessels on short-term charters, and has negatively impacted global economic activity and trade patterns [24]. - The tanker charter rates have been significantly reduced as a result of COVID-19, leading to increased volatility in the tanker industry [28]. - The company experienced increased off-hire days and a slight increase in operating expenses due to crew rotation disruptions caused by COVID-19 measures [25]. - The company faces significant risks to personnel and operations due to the COVID-19 pandemic, impacting crew safety and operational efficiency [24]. - The company experienced a revenue reduction of approximately $344 due to COVID-19 related delays, resulting in increased off-hire days [84]. - The financial results may be adversely affected by the ongoing outbreak of COVID-19 and related governmental responses [24]. Debt and Liabilities - The company had total indebtedness of $178.2 million as of June 30, 2021, with cash and cash equivalents amounting to $12.4 million [52]. - Current liabilities surged from $25,414 thousand as of December 31, 2020, to $53,058 thousand as of June 30, 2021, an increase of 108.5% [65]. - Non-current liabilities rose from $133,400 thousand to $174,850 thousand, marking an increase of 31% [65]. - The total long-term debt increased from $106.999 million as of December 31, 2020, to $158.558 million as of June 30, 2021, representing a growth of 48% [112]. - The company has remaining contractual commitments totaling $217,293, with $44,500 due from July 1 to December 31, 2021, and $172,793 from January 1 to March 31, 2022 [93]. - The company expects to finance its unfinanced contractual commitments through operational cash flow, proceeds from vessel sales, or a combination of debt and equity issuances [54]. Equity and Shareholder Information - The weighted average common shares outstanding increased significantly from 7,302,633 to 39,831,972 shares, reflecting a substantial dilution [68]. - Total stockholders' equity decreased from $120,701 thousand to $111,658 thousand, a decline of 7.5% [66]. - The Company declared a dividend of $915 thousand for the period from January 1, 2021, to June 30, 2021 [102]. - No dividends were paid to common stockholders in the six months ended June 30, 2020 and 2021 [126]. Asset Management - Total assets increased from $293,032 thousand as of December 31, 2020, to $353,083 thousand as of June 30, 2021, representing a growth of 20.5% [65]. - Cash and cash equivalents decreased from $19,328 thousand to $8,393 thousand, a decline of 56.6% [65]. - The company recognized impairment on vessels amounting to $1,160 thousand for the six months ended June 30, 2021 [68]. - The carrying value of net assets of companies acquired was $3,131,000 as of June 30, 2021 [73]. - The company recorded an impairment charge of $1,160 for a vessel held for sale, with a fair value of $25,887 as of June 30, 2021 [137]. Future Projections and Commitments - Future minimum operating lease payments total $45.216 million, with $6.097 million due in 2021 and $12.084 million in 2022 [103]. - Future minimum time-charter receipts from vessels in operation as of June 30, 2021, are projected to be $120.438 million [107]. - The company has remaining contractual commitments for fleet acquisitions totaling $57.143 million, with $6.016 million payable in the last six months of 2021 [123]. - A financing commitment of $107,709 was received for the newbuilding vessels, with repayments structured in 32 quarterly installments of $673 [144].

Operational Metrics and Performance - The company defines key operational metrics including calendar days, available days, operating days, and fleet utilization to assess performance and efficiency[325]. - Time charter revenues are influenced by the number of vessels, operating days, and daily charter hire rates, which are affected by market supply and demand dynamics[329]. - The company has four MR product/chemical tankers and three suezmax crude oil tankers as of the report date, with plans to operate vessels in the spot market until appropriate charters are secured[333]. - Voyage expenses consist mainly of port charges, fuel costs, and commissions, with the amount driven by travel routes and bunker fuel prices[336]. - Vessel operating expenses are analyzed on a U.S. dollar per day basis and can fluctuate due to unplanned repairs and regulatory compliance[340]. - Dry-docking costs vary based on vessel age, location, and compliance with international standards[341]. - The principal factors affecting profitability include charter rates, tanker utilization, operating expenses, and financing costs[346]. Financial Performance - Total charter revenues decreased by $5.9 million, or 9%, from $66.1 million in 2019 to $60.2 million in 2020[348]. - Average number of vessels employed decreased from 11.1 in 2019 to 9.5 in 2020, impacting all vessel-related revenues and expenses[349]. - Operating lease expenses decreased by $6.3 million, or 89%, from $7.1 million in 2019 to $0.8 million in 2020[350]. - Management fees to related parties increased by $3.2 million, or 130%, primarily due to purchase commissions absent in 2019[351]. - Vessel depreciation increased by $0.8 million, or 6%, mainly due to new vessels delivered in 2020[352]. - Interest and finance costs increased by $2.9 million, or 16%, primarily due to accelerated amortization of deferred finance fees[354]. - Loss on sale of vessels amounted to $12.4 million due to the sale of multiple vessels in 2020[359]. - Other operating loss from charter termination fees totaled $4.8 million in 2020[360]. Assets and Liabilities - As of December 31, 2020, the basic charter-free market values of owned vessels were estimated to be higher than their carrying value by approximately 1.6%[362]. - The company recognized an impairment charge of $3.1 million on investments in unconsolidated joint ventures in December 2019[358]. - As of December 31, 2020, the company had a net indebtedness of $107.0 million, with total indebtedness amounting to $104.6 million after excluding unamortized financing fees[378]. - The company had remaining contractual commitments for fleet acquisition totaling $182.0 million as of December 31, 2020, with $116.4 million payable in 2021 and $94.7 million payable in 2022[379]. - Cash and cash equivalents amounted to $23.3 million as of December 31, 2020, including $4.0 million classified as restricted cash[378]. - The company has contractual obligations totaling $380.0 million, with long-term debt accounting for $106.9 million and interest related to long-term debt at $33.8 million[432]. Cash Flow and Financing Activities - Net cash used in operating activities decreased by $13.2 million, or 69%, for 2020, totaling $6.0 million compared to $19.2 million for 2019[384]. - Net cash provided by investing activities for the year ended December 31, 2020 was $181.3 million, primarily from $310.0 million in net proceeds from vessel sales[387]. - Net cash used in financing activities for the year ended December 31, 2020 was $177.3 million, with $129.7 million from equity offerings and $60.2 million from long-term debt proceeds[390]. - The company expects operational cash flow to increase for the remainder of 2021 compared to the same period in 2020, driven by the contribution of two Suezmax tankers[382]. - The company had a working capital surplus of $19.7 million as of December 31, 2020[382]. - Non-cash adjustments for the year ended December 31, 2020 totaled $31.8 million, mainly due to depreciation expenses and losses from vessel sales[385]. - The company plans to finance unfinanced contractual commitments through operational cash flow, debt, or equity issuances, or a combination thereof[381]. Sale and Leaseback Agreements - The company entered into a sale and leaseback (SLB) agreement with Cargill for the vessel M/T Eco Marina Del Ray, generating gross proceeds of $32.4 million and committing to a buyback price of $22.7 million after five years[413]. - The SLB with Bank of Communications Financial Leasing Company resulted in gross proceeds of $21.7 million for M/T Nord Valiant and $24.1 million for M/T Eco California, with bareboat charter rates of $5,875 and $6,550 per day respectively[414]. - The SLB with China Merchants Bank Financial Leasing Co. Ltd. provided gross proceeds of $91.4 million for M/T Eco Bel Air and M/T Eco Beverly Hills, with a bareboat charter rate of $1.5 million per quarter per vessel[416]. - The SLB with AVIC generated gross proceeds of $60.2 million for M/T Eco Los Angeles and M/T Eco City of Angels, with a bareboat hire rate of $9,435 per day for the first five years[424]. - The company has continuous options to buy back vessels under various SLB agreements, with specific purchase prices stipulated in the agreements[421]. - The company is in compliance with all covenants related to its sale and leaseback agreements as of December 31, 2020[426]. Market Conditions and Risks - The COVID-19 pandemic has significantly reduced global demand for oil and may materially impact the company's earnings and financial condition for 2021[429]. - The company has fixed interest rates on all SLB financing facilities, mitigating exposure to interest rate risk as of December 31, 2020[614]. - In 2020, approximately 96.9% of the company's expenses were in U.S. dollars, 2.6% in Euro, and 0.5% in other currencies[615]. - A 5% decrease in the exchange rate from $1.1419 to $1.0848 would result in an expense saving of approximately $0.09 million for the year ended December 31, 2020[616]. - For the year ended December 31, 2019, a 5% decrease in the exchange rate from $1.1192 to $1.0633 would result in an expense saving of approximately $0.08 million[616].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 20-F (Mark One) [ ] REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2019 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________________ to _________________ OR [ ] SHELL COMPA ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 20-F (Mark One) [ ] REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 OR [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2018 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________________ to _________________ OR [ ] SHELL COMPA ...