FORM 10-Q

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

ý QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES AND EXCHANGE ACT OF 1934.

For the quarterly period ended September 30, 2003

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES AND EXCHANGE ACT OF 1934.

For the period from to

COMMISSION FILE NUMBER

001-16531

GENERAL MARITIME CORPORATION
(Exact name of registrant as specified in its charter)

Republic of the Marshall Islands		06-159-7083
(State or other jurisdiction incorporation or organization)		(I.R.S. Employer Identification No.)

35 West 56th Street New York, NY		10019
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (212) 763-5600

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities and Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ý No o

INDICATE THE NUMBER OF SHARES OUTSTANDING OF EACH OF THE ISSUER’S CLASSES OF COMMON STOCK, AS OF NOVEMBER 13, 2003:

Common Stock, par value $0.01 per share 36,964,770 shares

GENERAL MARITIME CORPORATION AND SUBSIDIARIES

INDEX

PART I:	FINANCIAL INFORMATION

ITEM 1.	FINANCIAL STATEMENTS

	Consolidated Balance Sheets as of September 30, 2003 (unaudited) and December 31, 2002	3

	Consolidated Statements of Operations (unaudited) for the three months and nine months ended September 30, 2003 and 2002	4

	Consolidated Statement of Shareholders’ Equity (unaudited) for the nine months ended September 30, 2003	5

	Consolidated Statements of Cash Flows (unaudited) for the nine months ended September 30, 2003 and 2002	6

	Notes to Consolidated Financial Statements (unaudited)	7

ITEM 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	16

ITEM 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	33

ITEM 4.	CONTROLS AND PROCEDURES	34

PART II:	OTHER INFORMATION

ITEM 1.	LEGAL PROCEEDINGS	34

ITEM 5.	OTHER INFORMATION	34

ITEM 6.	EXHIBITS AND REPORTS ON FORM 8-K	34

SIGNATURES		36

Item 1. Financial Statements

GENERAL MARITIME CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(IN THOUSANDS)

	September 30, 2003			December 31, 2002
	(UNAUDITED)

ASSETS
CURRENT ASSETS:
Cash	$	15,253		$	2,681
Due from charterers	29,199			25,008
Vessels held for sale	2,000			4,000
Prepaid expenses and other current assets	20,439			12,152
Total current assets	66,891			43,841

NONCURRENT ASSETS:
Vessels, net of accumulated depreciation of $197,056 and $145,411, respectively	1,188,125			711,344
Other fixed assets, net	1,858			870
Deferred drydock costs, net	19,902			15,555
Deferred financing costs, net	16,576			4,563
Due from charterers	—			351
Goodwill	5,753			5,753
Total noncurrent assets	1,232,214			738,436
TOTAL ASSETS	$	1,299,105		$	782,277

LIABILITIES AND SHAREHOLDERS’ EQUITY:
CURRENT LIABILITIES:
Accounts payable and accrued expenses	$	23,454		$	15,157
Accrued interest	1,814			359
Current portion of long-term debt	53,560			62,003
Total current liabilities	78,828			77,519
NONCURRENT LIABILITIES:
Deferred voyage revenue	247			744
Long-term debt	656,454			218,008
Derivative liability for cash flow hedge	3,270			4,370
Total noncurrent liabilities	659,971			223,122
Total liabilities	738,799			300,641
COMMITMENTS AND CONTINGENCIES SHAREHOLDERS’ EQUITY:
Common stock, $0.01 par value per share; Authorized 75,000,000 shares; Issued and outstanding 36,964,770 shares	370			370
Paid-in capital	418,788			418,788
Restricted stock	(3,335		)	(3,742		)
Retained earnings	147,753			70,590
Accumulated other comprehensive loss	(3,270		)	(4,370		)
Total shareholders’ equity	560,306			481,636
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,299,105		$	782,277

See notes to consolidated financial statements.

GENERAL MARITIME CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(IN THOUSANDS, EXCEPT PER SHARE DATA)

(UNAUDITED)

	FOR THE THREE MONTHS ENDED SEPTEMBER 30,						FOR THE NINE MONTHS ENDED SEPTEMBER 30,
	2003			2002			2003			2002
VOYAGE REVENUES:
Voyage revenues	$	109,848		$	54,960		$	327,589		$	162,478
OPERATING EXPENSES:
Voyage expenses	35,331			21,764			87,476			59,344
Direct vessel expenses	27,556			14,046			63,966			41,582
General and administrative	5,795			3,175			15,598			8,553
Depreciation and amortization	23,583			15,885			59,477			45,308
Writedown (gain on sale) of vessels	—			4,520			(930		)	4,520
Total operating expenses	92,265			59,390			225,587			159,307
OPERATING INCOME (LOSS)	17,583			(4,430		)	102,002			3,171
INTEREST INCOME (EXPENSE):
Interest income	93			45			391			192
Interest expense	(10,627		)	(3,559		)	(25,230		)	(11,366		)
Net interest expense	(10,534		)	(3,514		)	(24,839		)	(11,174		)
Net income (loss)	$	7,049		$	(7,944	)	$	77,163		$	(8,003	)

Basic earnings (loss) per common share	$	0.19		$	(0.21	)	$	2.09		$	(0.22	)
Diluted earnings (loss) per common share	$	0.19		$	(0.21	)	$	2.07		$	(0.22	)

Weighted average shares outstanding:
Basic	36,964,770			36,964,770			36,964,770			36,985,934
Diluted	37,381,444			36,964,770			37,311,616			36,985,934

See notes to consolidated financial statements.

GENERAL MARITIME CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY (UNAUDITED) FOR

THE NINE MONTHS ENDED SEPTEMBER 30, 2003

(IN THOUSANDS)

	Common Stock		Paid-in Capital		Restricted Stock			Retained Earnings		Accumulated Other Comprehensive Loss			Comprehensive Income (Loss)		Total
Balance as of January 1, 2003	$	370	$	418,788	$	(3,742	)	$	70,590	$	(4,370	)			$	481,636
Comprehensive loss:
Net income								77,163		0			$	77,163	77,163
Unrealized derivative gains on cash flow hedge										1,100			1,100		1,100
													$	78,263

Restricted stock amortization					407										407
Balance at September 30, 2003 (unaudited)	$	370	$	418,788	$	(3,335	)	$	147,753	$	(3,270	)			$	560,306

See notes to consolidated financial statements.

GENERAL MARITIME CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(IN THOUSANDS)

(UNAUDITED)

	FOR THE NINE MONTHS ENDED SEPTEMBER 30,
	2003			2002

CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:
Net income (loss)	$	77,163		$	(8,003	)
Adjustments to reconcile net income to net cash provided by operating activities:
(Gain on sale) writedown of vessel	(930		)	4,520
Depreciation and amortization	59,477			45,308
Restricted stock compensation expense	407			—
Amortization of discount on senior notes	125			—
Changes in assets and liabilities:
(Increase) decrease in due from charterers	(3,840		)	3,948
(Increase) decrease in prepaid expenses and other assets	(8,287		)	1,738
Increase (decrease) in accounts payable and accrued expenses	9,752			(2,857		)
Decrease in deferred voyage revenue	(497		)	(1,671		)
Deferred drydock costs incurred	(9,408		)	(10,348		)
Net cash provided by operating activities	123,962			32,635

CASH FLOWS USED BY INVESTING ACTIVITIES:
Purchase of vessels	(528,426		)	—
Proceeds from sale of vessel	2,930			—
Purchase of other fixed assets	(1,287		)	(163		)
Net cash used by investing activites	(526,783		)	(163		)

CASH FLOWS PROVIDED (USED) BY FINANCING ACTIVITIES:
Proceeds from senior notes offering	246,158			—
Long-term debt borrowings	275,000			10,000
Principal payments on long - term debt	(64,222		)	(54,750		)
Deferred financing costs paid	(14,485		)	(121		)
Net (payments) borrowings on revolving credit facilities	(27,058		)	—
Common stock issuance costs paid	—			(467		)
Net cash provided (used) by financing activities	415,393			(45,338		)

Net increase (decrease) in cash	12,572			(12,866		)
Cash, beginning of the year	2,681			17,186
Cash, end of period	$	15,253		$	4,320

Supplemental disclosure of cash flow information:
Cash paid during the period for interest	$	23,775		$	11,417

See notes to consolidated financial statements.

GENERAL MARITIME CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA)

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NATURE OF BUSINESS- General Maritime Corporation (the “Company”) through its subsidiaries provides international transportation services of seaborne crude oil. The Company’s fleet is comprised of both Aframax and Suezmax tankers. Although some of the Company’s vessels are able to carry dry cargo, the Company operates its business in one business segment, which is the transportation of international seaborne crude oil.

The Company’s vessels are primarily available for charter on a spot voyage or time charter basis. Under a spot voyage charter, which generally lasts between two to ten weeks, the owner of a vessel agrees to provide the vessel for the transport of specific goods between specific ports in return for the payment of an agreed upon freight per ton of cargo or, alternatively, for a specified total amount. All operating costs such as for crews, maintenance, and insurance are typically paid by the owner of the vessels and specified voyage costs such as fuel and port costs are typically paid by the owner of the vessel.

A time charter involves placing a vessel at the charterer’s disposal for a set period of time during which the charterer may use the vessel in return for the payment by the charterer of a specified daily or monthly hire rate. In time charters, operating costs such as for crews, maintenance and insurance are typically paid by the owner of the vessel and specified voyage costs such as fuel and port charges are paid by the charterer.

BASIS OF PRESENTATION- The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and, therefore, do not include all information and footnotes necessary for a fair presentation of financial position, results of operations and cash flows in conformity with accounting principles generally accepted in the United States of America. However, in the opinion of the management of the Company, all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of financial position and operating results have been included in the statements. Interim results are not necessarily indicative of results for a full year. Reference is made to the December 31, 2002 consolidated financial statements of General Maritime Corporation contained in its Annual Report on Form 10-K for the year ended December 31, 2002. Certain reclassifications have been made for consistent presentation.

BUSINESS GEOGRAPHICS- Non-U.S. operations accounted for 100% of revenues and net income or (loss). Vessels regularly move between countries in international waters over hundreds of trade routes. It is therefore impractical to assign revenues or earnings from the transportation of international seaborne crude oil products by geographical area.

PRINCIPLES OF CONSOLIDATION- The accompanying consolidated financial statements include the accounts of General Maritime Corporation and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated on consolidation.

VOYAGE CHARTERS — Voyage revenues and voyage expenses relating to time or spot market charters are recognized on a pro rata basis based on the relative transit time in each period. Voyage expenses primarily include only those specific costs which are borne by the Company in connection with spot charters which would otherwise have been borne by the charterer under time charter agreements. These expenses principally consist of fuel and port charges. Direct vessel expenses are recognized when incurred. Demurrage income represents payments by the charterer to the vessel owner when loading and discharging time exceed the stipulated time in the spot charter. Demurrage income is recognized in accordance with the provisions of the respective charter agreements and the circumstances under which demurrage claims arise.

TIME CHARTERS — Revenue from time charters, which may include escalation clauses, are recognized on a straight-line basis over the term of the respective time charter agreement. Direct vessel expenses are recognized when incurred.

EARNINGS PER SHARE —Basic earnings per share are computed by dividing net income by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflect the potential dilution that could occur if securities or other contracts to issue common stock were exercised. During the nine months ended September 30, 2002, stock options were not included in the calculation of diluted earnings per share because they were anti-dilutive.

DERIVATIVES AND HEDGING ACTIVITIES — Effective January 1, 2001, the Company adopted Statement of Financial Standards (“SFAS”) No. 133, ACCOUNTING FOR DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (“SFAS 133”), and its corresponding amendments under SFAS No. 138. SFAS 133 requires the Company to measure all derivatives, including certain derivatives embedded in other contracts, at fair value and to recognize them in the Consolidated Balance Sheet as an asset or liability, depending on the Company’s rights or obligations under the applicable derivative contract. For derivatives designated as fair value hedges, changes in the fair value of both the derivative instrument and the hedged item are recorded in earnings. For derivatives designated as cash flow hedges, the effective portions of changes in fair value of the derivative are reported in the other comprehensive income (“OCI”) and are subsequently reclassified into earnings when the hedged item affects earnings. Changes in fair value of derivative instruments not designated as hedging instruments and ineffective portions of hedges are recognized in earnings in the current period.

The Company is exposed to the impact of interest rate changes. The Company’s objective is to manage the impact of interest rate

changes on earnings and cash flows of its borrowings. The Company may use interest rate swaps to manage net exposure to interest rate changes related to its borrowings and to lower its overall borrowing costs. Significant interest rate risk management instruments

held by the Company during the nine months ended September 30, 2003 and 2002 included pay-fixed swaps. As of September 30, 2003, the Company is party to pay-fixed interest rate swap agreements that expire in 2006 which effectively convert floating rate obligations to fixed rate instruments. During the nine months ended September 30, 2003 and 2002, the Company recognized a credit/(charge) to OCI of $1,100 and $(3,405), respectively. The aggregate liability in connection with a portion of the Company’s

cash flow hedges as of September 30, 2003 was $3,270 and is presented as Derivative liability for cash flow hedge on the balance

sheet.

RECENT ACCOUNTING PRONOUNCEMENTS — During July 2001, the Financial Accounting Standards Board issued SFAS No. 141, “Business Combinations” and SFAS No. 142, “Goodwill and Other Intangible Assets.”

SFAS No. 141 requires the use of the purchase method of accounting for all business combinations initiated after September 30, 2001. Additionally, this statement further clarifies the criteria for recognition of intangible assets separately from goodwill for all business combinations completed after September 30, 2001, as well as requiring additional disclosures for business combinations.

The Company adopted SFAS No. 142, “Goodwill and Other Intangible Assets”. This Standard eliminates goodwill amortization from the Consolidated Statement of Operations and requires an evaluation of

goodwill for impairment (at the reporting unit level) upon adoption of this Standard, as well as subsequent evaluations on an annual basis, and more frequently if circumstances indicate a possible impairment. This impairment test is comprised of two steps. The initial step is designed to identify potential goodwill impairment by comparing an estimate of the fair value of the applicable reporting unit to its carrying value, including goodwill. If the carrying value exceeds fair value, a second step is performed, which compares the implied fair value of the applicable reporting unit’s goodwill with the carrying amount of that goodwill, to measure the amount of goodwill impairment, if any. The Company’s only reporting unit with goodwill is its technical management business, which is not a reportable segment. Goodwill must be tested for impairment as of the beginning of the fiscal year in which SFAS No. 142 is adopted. The Company completed its testing of goodwill and determined that there was no impairment.

SFAS No. 143, “Accounting for Asset Retirement Obligations” was issued in September 2001. This statement addresses financial accounting and reporting for the obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. This statement is effective for financial statements issued for fiscal years beginning after September 15, 2002. The adoption of this standard did not have a material effect on the Company’s financial position and results of operations.

SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets” was issued in October 2001. SFAS No. 144 replaces SFAS No. 121, “Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of.” SFAS No. 144 requires that held for use long-lived assets whose carrying amount is not recoverable from its undiscounted cash flows be measured at the lower of carrying amount or fair value. Held for sale long lived assets shall be measured at the lower of their carrying amount or fair value less cost to sell, whether reported in continuing operations or in discontinued operations. Therefore, discontinued operations will no longer be measured at net realizable value or include amounts for operating losses that have not yet occurred. SFAS No. 144 also broadens the reporting of discontinued operations to include all components of an entity with operations that can be distinguished from the rest of the entity and that will be eliminated from the ongoing operations of the entity in a disposal transaction. The provisions of SFAS No. 144 are effective for financial statements issued for fiscal years beginning after December 15, 2001 and are to be applied prospectively. The adoption of this standard did not have a material effect on the Company’s financial position and results of operations.

In November 2002, the FASB issued Financial Accounting Standards Board Interpretation No. 45, “Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of Others” (FIN 45), which requires a guarantor to recognize a liability for the fair value of the obligation at the inception of the guarantee. The Company adopted the disclosure requirements of FIN 45 as of December 31, 2002. The adoption of the measurement requirements of FIN 45 did not have a material impact on the Company’s financial position or results of operation.

In January 2003, the FASB issued FIN 46, “Consolidation of Variable Interest Entities,” which clarified the application of Accounting Research Bulletin No. 51, “Consolidated Financial Statements,” to address perceived weaknesses in accounting for entities commonly known as special-purpose or off-balance sheet entities. It provides guidance for identifying the party with a controlling financial interest resulting from arrangements or financial interests rather than voting interests. It requires consolidation of Variable Interest Entities (“VIEs”) only if those VIEs do not effectively disperse the risks and benefits amount the various parties involved. In October 2003, the effective date of FIN No. 46 was deferred for variable interests held by public companies in all entities that were acquired prior to February 1, 2003. This deferral is to allow time for certain implementation issues to be addressed through the issuance of a potential modification to the interpretation. The deferral revised the effective date for consolidation of these entities for the Company to the quarter ended January 3, 2004. Based on the current rules, the Company does not believe it will be required to consolidate any variable interest entities as a result of FIN 46.

In April 2003, the FASB issued SFAS No. 149, “Amendment to Statement 133 on Derivative Instruments and Hedging Activities.” SFAS No. 149 amends and clarifies accounting for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities under SFAS No. 133. SFAS No. 149 is applied prospectively and is effective for contracts entered into or modified after June 30, 2003, except for SFAS No. 133 implementation issues that have been effective for fiscal quarters that began prior to June 15, 2003 and certain provisions relating to forward purchases and sales on securities that do not yet exist. The adoption of this standard did not have a material effect on the Company’s financial position and results of operations.

In May 2003, the FASB issued SFAS No. 150, “Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity.” SFAS No. 150 changes the accounting guidance for certain financial instruments that, under previous guidance, could have been classified as either a liability or equity. SFAS No. 150 now requires those instruments to be classified as liabilities (or as assets under some circumstances) in the statement of financial position. SFAS No. 150 also requires the terms of those instruments and any settlement alternatives to be disclosed. SFAS No. 150 is effective for all financial instruments entered into or modified after May 31, 2003. Otherwise, it is effective at the beginning of the first interim period beginning after June 15, 2003. The adoption of SFAS No. 150 did not have a material impact on the Company’s financial position and results of operations.

2. EARNINGS PER COMMON SHARE

The computation of basic earnings (loss) per share is based on the weighted average number of common shares outstanding during the periods being reported on. The computation of diluted earnings (loss) per share assumes the exercise of all stock options using the treasury stock method and the granting of unvested restricted stock awards for which the assumed proceeds upon grant are deemed to be the amount of compensation cost attributable to future services and not yet recognized using the treasury stock method, to the extent dilutive.

The components of the denominator for the calculation of basic earnings per share and diluted earnings per share for the three and nine months ended September 30, 2003 and 2002 are as follows:

	Three months ended September 30,		Nine months ended September 30,
	2003	2002	2003	2002

Basic earnings per share:
Weighted average common shares outstanding	36,964,770	36,964,770	36,964,770	36,985,934

Diluted earnings per share:
Weighted average common shares outstanding	36,964,770	36,964,770	36,964,770	36,985,934
Stock options	70,736	—	56,294	—
Restricted stock awards	345,938	—	290,552	—

	37,381,444	36,964,770	37,311,616	36,985,934

3. VESSEL ACQUISITIONS

The Company acquired between March 2003 and May 2003 19 tankers from an unaffiliated entity consisting of 14 Suezmax tankers and five Aframax tankers. The aggregate purchase price of these vessels was $525,000, which was financed through the use of cash and borrowings under the Company’s

existing revolving credit facilities together with the incurrence of additional debt described in Note 4.

4. LONG-TERM DEBT

Long-term debt consists of the following:

	September 30, 2003 (unaudited)		Decmeber 31, 2002
First Credit Facility
Term Loan	$	96,609	$	129,411
Revolving Credit Facility	37,395		54,100
Second Credit Facility
Term Loan	57,000		74,500
Revolving Credit Facility	11,648		22,000
Third Credit Facility	261,079		—
Senior Notes, net of $3,717 discount	246,283		—
Total	710,014		280,011
Less: Current portion of long-term debt	53,560		62,003
Long-term debt	$	656,454	$	218,008

In June 2001, the Company entered into two credit facilities. The First Credit Facility, entered into on June 15, 2001, is comprised of a $200,000 term loan and a $100,000 revolving loan. The sale of two vessels collateralizing the First Credit Facility resulted in a reduction of the $100,000 revolving loan to $97,586. The First Credit Facility matures on June 15, 2006. The term loan is repayable in quarterly installments. The principal of the revolving loan is payable at maturity. The First Credit Facility bears interest at LIBOR plus 1.5%. The Company must pay a fee of 0.625% per annum on the unused portion of the revolving loan on a quarterly basis. As of September 30, 2003, the Company had $96,609 outstanding on the term loan and $37,395 outstanding on the revolving loan. The Company’s obligations under the First Credit Facility are secured by 18 vessels, with an aggregate carrying value of $438,156 at September 30, 2003.

On June 27, 2001, the Company entered into an additional credit facility (the “Second Credit Facility”) consisting of a $115,000 term loan and a $50,000 revolving loan. The Second Credit Facility maturity date is June 27, 2006. The term loan is repayable in quarterly installments. The principal of the revolving loan is payable at maturity. The Second Credit Facility bears interest at LIBOR plus 1.5%. The Company must pay a fee of 0.625% per annum on the unused portion of the revolving loan on a quarterly basis. As of September 30, 2003, the Company had $57,000 outstanding on the term loan and $11,648 outstanding on the revolving loan. The Company’s obligations under the Second Credit facility agreements are secured by nine vessels with a carrying value of approximately $238,299 at September 30, 2003.

On March 11, 2003 in connection with the 19 vessels acquired by the Company as discussed in Note 3, the Company entered into commitments for $450,000 in credit facilities. These credit facilities are comprised of a first priority $350,000 amortizing term loan (the “Third Credit Facility”) and a second priority $100,000 non-amortizing term loan (the “Second Priority Term Loan”). Pursuant to the issuance of the Senior Notes described below, the Third Credit Facility was reduced to $275,000 (such reduction from $350,000 will be treated as a prepayment of the first six installments due under this facility) and the Second Priority Term Loan was eliminated. The Third Credit Facility matures on March 10, 2008, is repayable in 19 quarterly installments and bears an interest rate of LIBOR plus 1.625%. The Company’s obligations under this credit facility are secured by the 19 tankers the Company acquired as described in Note 3. As of September 30,

2003, the Company had outstanding $261,079 on the Third Credit Facility. The Company’s obligations under the Third Credit Facility agreements are secured by 19 vessels with a carrying value of approximately $513,670 at September 30, 2003.

The terms and conditions of the First, Second and Third Credit Facilities require compliance with certain restrictive covenants. Under the credit facilities, the Company is required to maintain certain ratios such as: vessel market values to total outstanding loans and undrawn revolving credit facilities, EBITDA to net interest expense and to maintain minimum levels of working capital. As of September 30, 2003, the Company is in compliance with all of its restrictive covenants.

In August 2001 and October 2001, the Company entered into interest rate swap agreements with foreign banks to manage interest costs and the risk associated with changing interest rates. At their inception, these swaps had notional principal amounts equal to 50% the Company’s outstanding term loans, described above. The notional principal amounts amortize at the same rate as the term loans. The interest rate swap agreement entered into during August 2001 hedges the First Credit Facility, described above, to a fixed rate of 6.25%. This swap agreement terminates on June 15, 2006. The interest rate swap agreement entered into during October 2001 hedges the Second Credit Facility, described above, to a fixed rate of 5.485%. This swap agreement terminates on June 27, 2006. The differential to be paid or received for these swap agreements is recognized as an adjustment to interest expense as incurred. As of September 30, 2003, the outstanding notional principal amount on the swap agreements entered into during August 2001 and October 2001 are $49,500 and $28,500, respectively.

Interest expense pertaining to interest rate swaps for the nine months ended September 30, 2003 and 2002 was $2,263 and $2,443, respectively.

On March 20, 2003, in connection with the 19 vessels acquired by the Company as discussed in Note 3, the Company issued $250,000 of 10% Senior Notes which are due March 15, 2013. Interest is paid on the Senior Notes each March 15 and September 15. The Senior Notes are general unsecured, senior obligations of the Company. The proceeds of the Senior Notes, prior to payment of fees and expenses, were $246,158, which is net of the original issue discount of $3,842. This discount is being amortized as interest expense over the term of the Senior Notes using the effective interest method. As of September 30, 2003, the discount on the Senior Notes was $3,717. The Senior Notes are guaranteed by all of the Company’s present subsidiaries and future “restricted” subsidiaries. The Senior Notes contain incurrence covenants which, among other things, restrict the Company’s ability to incur future indebtedness and liens, to apply the proceeds of asset sales freely, to merge or undergo other changes of control and to pay dividends, and require the Company to apply a portion of its cash flow during 2003 to the reduction of its debt under our First, Second and Third Credit Facilities. Additionally, certain defaults on other debt instruments, such as failure to pay interest or principal when due is deemed to be a default under the Senior Notes agreement.

Pursuant to the provisions of the Senior Notes, the Company is required to apply a portion of its cash flow (as defined) during the calendar year ending December 31, 2003 to the reduction of its debt under the First, Second and Third credit Facilities. For the three months ended September 30, 2003, this cash flow was determined to be $4,315, of which $1,886 will be used to repay a portion of the revolving loans outstanding on the First and Second Credit Facilities and $2,429 will be applied to the Third Credit Facility by November 30, 2003.

Based on borrowings as of September 30, 2003, aggregate maturities under the First, Second and Third Credit Facilities including permanent repayments of the Third Credit Facility of $2,429 described above as well as the Senior Notes are as follows:

PERIOD ENDING DECEMBER 31,	First Credit Facility		Second Credit Facility		Third Credit Facility		Senior Notes		TOTAL
2003 (October 1- December 31)	$	8,782	$	4,000	$	2,429	$	—	$	15,211
2004	35,131		16,000		—		—		51,131
2005	35,131		16,000		47,003		—		98,134
2006	54,960		32,648		47,003		—		134,611
2007	—		—		58,787		—		58,787
Thereafter	—		—		105,857		250,000		355,857

	$	134,004	$	68,648	$	261,079	$	250,000	$	713,731

5. WRITEDOWN (GAIN ON SALE) OF VESSELS

During the nine months ended September 30, 2003, the Company sold a vessel which was held for sale as of December 31, 2002 for $2,930, resulting in a gain of $930.

During the three months ended September 30, 2002, the Company decided to retire a 1979-built single-hull Aframax tanker through its sale for scrap. This decision was based on management’s assessment of estimated charter rates for the vessel and the estimated daily operating costs as well as the cost of this vessel’s next drydocking which was scheduled for April 2003. An expense of $4,520 was recognized during the three months ended September 30, 2002, which was the amount by which the vessel’s carrying value exceeded the estimated net proceeds to be received upon disposal.

6. RELATED PARTY TRANSACTIONS

The following are related party transactions not disclosed elsewhere in these financial statements:

The Company rents office space as its principal executive offices in a building currently leased by GenMar Realty LLC, a company wholly owned by Peter C. Georgiopoulos, the Chairman and Chief Executive Officer of the Company. There is no lease agreement between the Company and GenMar Realty LLC. The Company currently pays an occupancy fee on a month to month basis in the amount of $55. For the nine months ended September 30, 2003 and 2002, the Company expensed $495 in each period for occupancy fees. For the years ended December 31, 2002 and 2001, the Company’s occupancy fees were $660 in each year.

During the fourth quarter of 2000, the Company loaned $486 to Peter C. Georgiopoulos. This loan does not bear interest and is due and payable on demand. The full amount of this loan was outstanding as of September 30, 2003.

During the nine months ended September 30, 2003, the Company incurred legal services (primarily in connection with the acquisition of 19 tankers during 2003) aggregating $176 to the father of Mr. Peter Georgiopoulos. This amount is unpaid as of September 30, 2003 and is included in accounts payable and accrued expenses.

7. STOCK OPTION PLAN

On June 10, 2001, the Company adopted the General Maritime Corporation 2001 Stock Incentive Plan. Under this plan the Company’s compensation committee, another designated committee of the board of

directors or the board of directors, may grant a variety of stock based incentive awards to employees, directors and consultants whom the compensation committee (or other committee or the board of directors) believes are key to the Company’s success. The compensation committee may award incentive stock options, nonqualified stock options, stock appreciation rights, dividend equivalent rights, restricted stock, unrestricted stock and performance shares.

The aggregate number of shares of common stock available for award under the 2001 Stock Incentive Plan is 2,900,000 shares. As of June 30, 2001, the Company granted incentive stock options and nonqualified stock options to purchase 860,000 shares of common stock at an exercise price of $18 per share under the provisions of the 2001 Stock Incentive Plan. These options expire in 10 years. Options to purchase 110,000 shares of common stock vested immediately on June 12, 2001, the date of the grant. 25% of the remaining 750,000 options will vest on each of the first four anniversaries of the grant date. All options granted under this plan will vest upon a change of control, as defined. These options will be incentive stock options to the extent allowable under the Internal Revenue Code.

On November 26, 2002, the Company’s chief executive officer and chief operating officer surrendered to the Company outstanding options to purchase an aggregate of 590,000 shares of common stock. Also on November 26, 2002, options to purchase 143,500 shares of common stock were granted to other employees at an exercise price of $6.06 (the closing price on the date of grant). These options will generally vest in four equal installments on each of the first four anniversaries of the date of grant.

On May 5, 2003, the Company granted options to purchase 50,000 shares of common stock to the Company’s chief financial officer at an exercise price of $8.73 (the closing price on the date of grant). These options will vest in four equal installments on each of the first four anniversaries of the date of grant.

On June 5, 2003, the Company granted options to purchase an aggregate of 12,500 shares of common stock to five outside directors of the Company at an exercise price of $9.98 (the closing price on the date of grant). These options will vest in four equal installments on each of the first four anniversaries of the date of grant.

The Company follows the provisions of APB 25 to account for its stock option plan. The fair value of the options were determined on the date of grant using a Black-Scholes option pricing model. These options were valued based on the following assumptions: an estimated life of five years for all options granted, volatility of 47%, 63% and 54% for options granted during 2003, 2002 and 2001, respectively, risk free interest rate of 3.5%, 4.0% and 5.5% for options granted during 2003, 2002 and 2001, respectively, and no dividend yield for any options granted. The fair value of the 860,000 options to purchase common stock granted on June 12, 2001 is $8.50 per share. The fair value of the options to purchase common stock granted on November 26, 2002 is $3.42 per share. The fair value of the options to purchase common stock granted on May 5, 2003 and June 5, 2003 is $3.95 per share and $4.52 per share, respectively.

Had compensation cost for the Company’s stock option plans been determined based on the fair value at the grant dates for awards under those plans consistent with the methods recommended by SFAS No. 123, the Company’s net income and net income per share for the three and nine months ended September 30, 2003 and 2002, would have been stated at the pro forma amounts indicated below:

	Three months ended September 30,					Nine months ended September 30,
	2003		2002			2003		2002
Net Income (Loss):
As reported	$	7,049	$	(7,944	)	$	77,163	$	(8,003	)
Stock based compensation expense using the fair value method	184		614			504		1,843
Pro forma	$	6,865	$	(8,558	)	$	76,659	$	(9,846	)

Earnings per share (as reported):
Basic	$	0.19	$	(0.21	)	$	2.09	$	(0.22	)
Diluted	$	0.19	$	(0.21	)	$	2.07	$	(0.22	)

Earnings per share (pro forma):
Basic	$	0.19	$	(0.23	)	$	2.07	$	(0.27	)
Diluted	$	0.18	$	(0.23	)	$	2.05	$	(0.27	)

8. SUBSEQUENT EVENTS

During November 2003, the Company signed contracts to sell two 1986-built double-bottomed Aframax tankers for aggregate estimated net proceeds of approximately $20,700, which will result in an estimated loss on disposal of approximately $1,000. This loss will be recognized in the fourth quarter of 2003.

Also in November 2003, the Company signed a contract to sell for scrap a 1981-built single hull Aframax tanker. The Company recorded a $4,741 impairment during the year ended December 31, 2002 and classified the estimated net realizable value of $2,000 from disposition as a vessel held for sale on the balance sheet. The estimated net proceeds on the sale of this vessel are expected to be approximately $3,750, resulting in an estimated gain on disposal of this vessel of approximately $1,750 which will be recognized in the fourth quarter of 2003.

Approximately $12,100 of the estimated proceeds from the sale of these three tankers will be used to permanently prepay indebtedness under the First and Third Credit Facilities. Additionally, the revolving loan commitment amount under the First Credit Facility will be reduced by approximately $1,000.

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

This report contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward looking statements are based on management’s current expectations and observations. Included among the factors that, in our view, could cause actual results to differ materially from the forward looking statements contained in this report are the following: changes in demand or a material decline in rates in the tanker market; changes in production of or demand for oil and petroleum products, generally or in particular regions; greater than anticipated levels of tanker newbuilding orders or lower than anticipated rates of tanker scrapping; changes in rules and regulations applicable to the tanker industry, including, without limitation, legislation adopted by international organizations such as the International Maritime Organization and the European Union or by individual countries; actions taken by regulatory authorities; changes in trading patterns significantly impacting overall tanker tonnage requirements; changes in the seasonal variations in tanker charter rates; changes in the cost of other modes of oil transportation; changes in oil transportation technology; increases in costs including but not limited to: crew wages, insurance, provisions, repairs and maintenance; changes in general domestic and international political conditions; changes in the condition of the Company’s vessels or applicable maintenance or regulatory standards (which may affect, among other things, our anticipated dry docking costs); and other factors listed from time to time in our filings with the Securities and Exchange Commission including, without limitation, our Annual Report on Form 10-K for the year ended December 31, 2002.

GENERAL

We are a leading provider of international seaborne crude oil transportation services with a fleet of 46 vessels, consisting of 27 Aframax and 19 Suezmax tankers. Included in our Aframax fleet are nine OBO vessels (combination vessels which can perform both wet and dry trades). Through September 30, 2003, we have used these OBO vessels exclusively to transport crude oil. During the fourth quarter of 2003, we have chartered seven of our OBO’s on a time charter basis to a charterer who we expect will use these vessels in both the wet and dry trade. We have one of the largest mid-sized tanker fleets in the world, with a total cargo carrying capacity of approximately 5.5 million deadweight tons. Figures for our current 46 vessel fleet include 19 tankers we acquired during the period from March 2003 to May 2003. A summary of vessel acquisitions and dispositions through September 30, 2003 are as follows:

Tanker Name	Status	Vessel Type	Date
Genmar Traveller	Acquired	Suezmax	March 11
Genmar Transporter	Acquired	Suezmax	March 12
Genmar Sky	Acquired	Suezmax	March 13
Genmar Orion	Acquired	Suezmax	March 24
Genmar Ocean	Acquired	Aframax	March 28
Kentucky	Sold	Aframax	March 31
Genmar Ariston	Acquired	Suezmax	April 4
Genmar Kestrel	Acquired	Suezmax	April 4
Genmar Centaur	Acquired	Suezmax	April 9
Genmar Spyridon	Acquired	Suezmax	April 15
Genmar Phoenix	Acquired	Suezmax	April 15
Genmar Baltic	Acquired	Aframax	April 16
Genmar Horn	Acquired	Suezmax	April 17
Genmar Prometheus	Acquired	Suezmax	April 17
Genmar Pacific	Acquired	Aframax	April 22
Genmar Argus	Acquired	Suezmax	April 24
Genmar Hope	Acquired	Suezmax	May 2
Genmar Gulf	Acquired	Suezmax	May 5
Genmar Princess	Acquired	Aframax	May 27
Genmar Progress	Acquired	Aframax	May 29

We actively manage the deployment of our fleet between spot charters, which generally last from several days to several weeks, and time charters, which can last up to several years. A spot charter is generally a contract to carry a specific cargo from a load port to a discharge port for an agreed upon total amount. Under spot charters, we pay voyage expenses such as port, canal and fuel costs. A time charter is generally a contract to charter a vessel for a fixed period of time at a set daily rate, which may contain market rate adjustments. Under time charters, the charterer pays voyage expenses such as port, canal and fuel costs.

We operate the majority of our vessels in the Atlantic basin, which includes ports in the Caribbean, South and Central America, the United States, Western Africa, the Mediterranean, Europe and the North Sea. We also currently operate vessels in the Black Sea, the Far East and in other regions, which we believe enable us to take advantage of market opportunities and to position our vessels in anticipation of drydockings.

We strive to optimize the financial performance of our fleet through the deployment of our vessels in both time charters and in the spot market. Vessels operating on time charters provide more predictable cash flows, but can yield lower profit margins than vessels operating in the spot market during periods characterized by favorable market conditions. Vessels operating in the spot market generate revenues that are less predictable but may enable us to capture increased profit margins during periods of improvement in tanker rates although we are also exposed to the risk of declining tanker rates.

We employ experienced management in all functions critical to our operations, aiming to provide a focused marketing effort, tight quality and cost controls and effective operations and safety monitoring. Through our wholly owned subsidiaries, General Maritime Management LLC, General Maritime Management (UK) LLC and United Overseas Tankers Ltd., we currently provide the commercial and technical management necessary for the operations of most of our vessels, which include ship maintenance, officer staffing, technical support, shipyard supervision, and risk management services through our wholly owned subsidiaries.

For discussion and analysis purposes only, we evaluate performance using net voyage revenues. Net voyage revenues are voyage revenues minus voyage expenses. Voyage expenses primarily consist of port, canal and fuel costs that are unique to a particular voyage, which would otherwise be paid by a charterer under a time charter. We believe that presenting voyage revenues, net of voyage expenses, neutralizes the variability created by unique costs associated with particular voyages or the deployment of vessels on time charter or on the spot market and presents a more accurate representation of the revenues generated by our vessels.

Our voyage revenues and voyage expenses are recognized ratably over the duration of the voyages and the lives of the charters, while direct vessel expenses are recognized when incurred. We recognize the revenues of time charters that contain rate escalation schedules at the average rate during the life of the contract. We calculate time charter equivalent, or “TCE,” rates by dividing net voyage revenue by the aggregate number of vessel operating days that we owned each vessel. We also generate demurrage revenue, which represents fees charged to charterers associated with our spot voyages when the charterer exceeds the agreed upon time required to load or discharge a cargo. We calculate daily direct vessel operating expenses and daily general and administrative expenses for the relevant period by dividing the total expenses by the aggregate number of calendar days that we owned each vessel for the period.

The following is a discussion of our financial condition and results of operations for the three months and nine months ended September 30, 2003 and 2002. You should consider the foregoing when reviewing the consolidated financial statements and this discussion. You should read this section together with the consolidated financial statements including the notes to those financial statements for the periods mentioned above.

SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA

INCOME STATEMENT DATA

	Three months ended						Nine months ended
(Dollars in thousands, except share data)	September-03			September-02			September-03			September-02

Voyage revenues	$	109,848		$	54,960		$	327,589		$	162,478
Voyage expenses	(35,331		)	(21,764		)	(87,476		)	(59,344		)
Net voyage revenues	74,517			33,196			240,113			103,134
Direct vessel expenses	27,556			14,046			63,966			41,582
General and administrative expenses	5,795			3,175			15,598			8,553
Depreciation and amortization	23,583			15,885			59,477			45,308
Write down (gain on sale) of vessels	—			4,520			(930		)	4,520
Operating income (loss)	17,583			(4,430		)	102,002			3,171
Net interest expense	10,534			3,514			24,839			11,174
Net income (loss)	$	7,049		$	(7,944	)	$	77,163		$	(8,003	)

Basic earnings (loss) per share	$	0.19		$	(0.21	)	$	2.09		$	(0.22	)

Diluted earnings (loss) per share	$	0.19		$	(0.21	)	$	2.07		$	(0.22	)
Weighted average shares outstanding, thousands	36,965			36,965			36,965			36,986
Diluted average shares outstanding, thousands	37,381			36,965			37,312			36,986

BALANCE SHEET DATA , at end of period

(Dollars in thousands)							September-03			December-02
Cash							$	15,253		$	2,681
Current assets, including cash							66,891			43,841
Total assets							1,299,105			782,277
Current liabilities, including current portion of long-term debt							78,828			77,519
Current portion of long-term debt							53,560			62,003
Total long-term debt, including current portion							710,014			280,011
Shareholders’ equity							560,306			481,636

OTHER FINANCIAL DATA

	Three months ended						Nine months ended
(dollars in thousands)	September-03			September-02			September-03			September-02
EBITDA(1)	$	41,166		$	11,455		$	161,479		$	48,479
Net cash provided by operating activities	27,136			11,834			123,962			32,635
Net cash used by investing activities	(1,083		)	(70		)	(526,783		)	(163		)
Net cash provided (used) by financing activities	(31,820		)	(13,250		)	415,393			(45,338		)
Vessel (sales) purchases, net	(489		)	—			(525,496		)	—
Capitalized drydocking costs	(5,008		)	(5,485		)	(9,408		)	(10,348		)
Weighted average long-term debt	728,924			304,788			577,902			320,200
FLEET DATA
Total number of vessels at end of period	46			29			46			29
Average number of vessels(2)	46.0			29.0			39.0			29.0
Total voyage days for fleet(3)	4,097			2,552			10,316			7,486
Total time charter days for fleet	706			317			1,784			1,173
Total spot market days for fleet	3,391			2,235			8,532			6,313
Total calendar days for fleet(4)	4,232			2,668			10,678			7,917
Fleet utilization(5)	96.8		%	95.7		%	96.6		%	94.6		%
AVERAGE DAILY RESULTS
Time Charter equivalent(6)	$	18,188		$	13,008		$	23,277		$	13,777
Direct vessel operating expenses per vessel (7)	6,512			5,265			5,990			5,253
General and administrative expense per vessel(8)	1,369			1,190			1,461			1,080
Total vessel operating expenses(9)	7,881			6,455			7,451			6,333
EBITDA(10)	9,728			4,293			15,123			6,123

	Three months ended						Nine months ended
	September-03			September-02			September-03			September-02
EBITDA Reconciliation
Net cash provided by operating activites	$	27,136		$	11,834		$	123,962		$	32,635
+ Gain on sale of vessel	—			(4,520		)	930			(4,520		)
- Restricted stock amortization expense	(136		)	—			(407		)	—
+ Changes in assets and liabilities	3,632			627			12,155			9,190
+ Net interest expense	10,534			3,514			24,839			11,174
EBITDA	41,166			11,455			161,479			48,479

(1) EBITDA represents net cash provided by operating activities plus net interest expense, adjusted for: (a) certain noncash adjustments to net income such as gains and losses on sales of assets and amortization of restricted stock awards and (b) changes in certain assets and liabilities. EBITDA is included because it is used by certain investors. EBITDA is not an item recognized by GAAP, and should not be considered as an alternative to net cash provided by operating activities or any other indicator of a company’s performance required by GAAP.

(2) Average number of vessels is the number of vessels that constituted our fleet for the relevant period, as a measured by the sum of the number of days each vessels was part of our fleet during the period divided by the number of calendar days in that period.

(3) Voyage days for fleet are the total days our vessels were in our possession for the relevant period net of off hire days associated with major repairs, drydockings or special or intermediate surveys.

(4) Calendar days are the total days the vessels were in our possession for the relevant period including off hire days associated with major repairs, drydockings or special or intermediate surveys.

(5) Fleet utilization is the percentage of time that our vessels were available for revenue generating voyage days, and is determined by dividing voyage days by calendar days for the relevant period.

(6) Time Charter Equivalent, or TCE, is a measure of the average daily revenue performance of a vessel on a per voyage basis. Our method of calculating TCE is consistent with industry standards and is determined by dividing net voyage revenue by voyage days.

(7) Daily direct vessel operating expenses, or DVOE, is calculated by dividing DVOE, which includes crew costs, provisions, deck and engine stores, lubricating oil, insurance and maintenance and repairs, by calendar days for the relevant time period.

(8) Daily general and administrative expense is calculated by dividing general and administrative expenses by vessel calendar days.

(9) Total Vessel Operating Expenses, or TVOE, is a measurement of our total expenses associated with operating our vessels. Daily TVOE is the sum of daily direct vessel operating expenses, or DVOE, and daily general and administrative expenses.

(10) Daily EBITDA is total EBITDA divided by total vessel calander days.

Margin analysis for the indicated items as a percentage of net voyage revenues for three months ended September 30, 2003 and 2002 and for the nine months ended September 30, 2003 and 2002 are set forth in the table below.

INCOME STATEMENT MARGIN ANALYSIS
(% of Net Voyage Revenues)

	Three months ended				Nine months ended
	September-03		September-02		September-03		September-02

INCOME STATEMENT DATA
Net voyage revenues(1)	100	%	100	%	100	%	100	%
Direct vessel expenses	37.0	%	42.3	%	26.6	%	40.3	%
General and administrative expenses	7.8	%	9.6	%	6.5	%	8.3	%
Depreciation and amortization	31.6	%	47.8	%	24.8	%	43.9	%
Gain on sale/writedown of vessels	0.0	%	13.6	%	-0.4	%	4.4	%
Total operating expenses	76.4	%	113.3	%	57.5	%	96.9	%
Operating income	23.6	%	-13.3	%	42.5	%	3.1	%
Net interest expense	14.1	%	10.6	%	10.4	%	10.9	%
Net income/ loss	9.5	%	-23.9	%	32.1	%	-7.8	%

(1) Net voyage revenues are voyage revenues minus voyage expenses. Voyage expenses primarily consist of port, canal and fuel costs that are unique to a particular voyage, which would otherwise be paid by a charterer under a time charter.

	Three months ended						Nine months ended
	(in thousands)						(in thousands)
	September-03			September-02			September-03		September-02
Voyage revenues	$	109,848		$	54,960		327,589		162,478
Voyage expenses	(35,331		)	(21,764		)	(87,476	)	(59,344	)
Net voyage revenues	$	74,517		$	33,196		240,113		103,134

THREE MONTHS ENDED SEPTEMBER 30, 2003 COMPARED TO THE THREE MONTHS ENDED SEPTEMBER 30, 2002

VOYAGE REVENUES — Voyage revenues increased by $54.9 million, or 99.9%, to $109.8 million for the three months ended September 30, 2003 compared to $54.9 million for the three months ended September 30, 2002. $47.8 million of this increase is due to the acquisition of 14 Suezmax tankers and five Aframax tankers during 2003. In addition, voyage revenues increased by $10.3 million on the 27 tankers which were part of our fleet since January 1, 2002 to $62.0 million for the three months ended September 30, 2003 compared to $51.7 million during the three months ended September 30, 2002, primarily as a result of better freight rates. These increases are partially offset by the $3.2 million decrease in voyage revenues associated with two Aframax tankers sold during November 2002 and March 2003. The average size of our fleet increased 58.6% to 46.0 (27.0 Aframax, 19.0 Suezmax) tankers during the three months ended September 30, 2003 compared to 29.0 tankers (24.0 Aframax, 5.0 Suezmax) during the comparable 2002 period.

VOYAGE EXPENSES — Voyage expenses increased $13.5 million, or 62.3%, to $35.3 million for the three months ended September 30, 2003 compared to $21.8 million for the three months ended September 30, 2002. $14.9 million of this increase is due to the acquisition of 14 Suezmax tankers and five Aframax tankers during 2003. In addition, voyage expenses increased by $1.0 million on the 27 tankers which were part of our fleet since January 1, 2002 to $20.4 million for the three months ended September 30, 2003 compared to $19.4 million during the three months ended September 30, 2002, due primarily to an increase in fuel costs. These increases are partially offset by the $2.4 million decrease in voyage expenses associated with two Aframax tankers sold during November 2002 and March 2003.

NET VOYAGE REVENUES — Net voyage revenues, which are voyage revenues minus voyage expenses, increased by $41.3 million, or 124%, to $74.5 million for the three months ended September 30, 2003 compared to $33.2 million for the three months ended September 30, 2002. $32.9 million of this increase is due to the acquisition of 14 Suezmax tankers and five Aframax tankers during 2003. In addition, net voyage revenues increased by $9.3 million on the 27 tankers which were part of our fleet since January 1, 2002 to $41.6 million for the three months ended September 30, 2003 compared to $32.3 million during the three months ended September 30, 2002, primarily as a result of better freight rates. These increases are partially offset by the $0.9 million decrease in net voyage revenues associated with two Aframax tankers sold during November 2002 and March 2003. Our average TCE rates improved 39.8% to $18,188 during the three months ended September 30, 2003 compared to $13,008 during the three months ended September 30, 2002.

The following is additional data pertaining to net voyage revenues:

	Three months ended September 30,				Increase
	2003		2002		(Decrease)		% Change
Net voyage revenue (in thousands):
Time charter:
Aframax	$	10,640	$	5,929	$	4,711	79	%
Suezmax	2,760		—		2,760		n/m
Total	13,400		5,929		7,471		126	%

Spot charter:
Aframax	28,661		20,623		8,038		39	%
Suezmax	32,456		6,644		25,812		388	%
Total	61,117		27,267		33,850		124	%

TOTAL NET VOYAGE REVENUE	$	74,517	$	33,196	$	41,321	124	%

Vessel operating days:
Time charter:
Aframax	566		317		249		79	%
Suezmax	140		—		140		n/m
Total	706		317		389		123	%

Spot charter:
Aframax	1,846		1,777		69		4	%
Suezmax	1,545		458		1,087		237	%
Total	3,391		2,235		1,156		52	%
TOTAL VESSEL OPERATING DAYS	4,097		2,552		1,545		61	%

Time Charter Equivalent (TCE):
Time charter:
Aframax	$	18,808	$	18,703	$	105	1	%
Suezmax	$	19,710	$	—	$	19,710	n/m
Combined	$	18,987	$	18,703	$	284	2	%

Spot charter:
Aframax	$	15,531	$	11,606	$	3,925	34	%
Suezmax	$	21,001	$	14,507	$	6,494	45	%
Combined	$	18,024	$	12,200	$	5,824	48	%

TOTAL TCE	$	18,188	$	13,008	$	5,180	40	%

We seek opportunities to increase the number of our vessels on time charters, but only expect to enter into additional time charters if we can obtain rates that provide us with an appropriate return. The following summarizes the portion of the Company’s fleet that was on time charter as of November 10, 2003:

Vessel	Vessel Type	Expiration Date	Average Daily Rate (1)
Genmar Alexandra	Aframax	February 20, 2004(2)		Market Rate(3)
Genmar Constantine	Aframax	March 7, 2004(2)		Market Rate (3)
Genmar Star (6)	Aframax	January 24, 2005		$19,000 (4)
Genmar Endurance (6)	Aframax	February 10, 2005		$19,000 (4)
Crude Princess	Aframax	March 31, 2004		Market Rate (5)
Crude Progress	Aframax	March 15, 2004		Market Rate (5)
Genmar Spirit (6)	Aframax	October 15, 2004		$19,700
Genmar Trust (6)	Aframax	October 13, 2004		$19,700
Genmar Pericles (6)	Aframax	October 2, 2004		$19,700
Genmar Hector(6)	Aframax	November 4, 2004		$19,700
Genmar Orion	Suezmax	May 14, 2004		$20,500

(1) Before brokers’ commissions.

(2) Termination date is plus or minus 15 days at charterer’s election.

(3) The charter provides for a floating rate based on weekly spot market rates which can be no less than $16,000 per day and no more than $22,000 per day.

(4) Commencing one year prior to charter expiration date, the daily rate will increase to $19,700.

(5) The charter provides for a floating rate based on spot market rates which have no floor and rates above $17,000 per day must be shared with charterer

(6) Charterer has the option to extend the time charter for an additional year at the same rate. If the charterer does not exercise their option, the Company can extend the time charter for an additional year, but at a reduced rate of approximately 20%

DIRECT VESSEL EXPENSES — Direct vessel expenses, which include crew costs, provisions, deck and engine stores, lubricating oil, insurance, maintenance and repairs increased by $13.6 million, or 96.2%, to $27.6 million for the three months ended September 30, 2003 compared to $14.0 million for the three months ended September 30, 2002. This increase is primarily due to the growth of our fleet, which increased 58.6% for the same periods, as well as an increase in maintenance and repairs. In addition, most of this 58.6% increase in the size of our fleet relates to the acquisition of Suezmax vessels which, although generally generating higher TCE rates, are more costly to operate than Aframax vessels. On a daily basis, direct vessel expenses per vessel increased by $1,247, or 23.7%, to $6,512 ($5,708 Aframax, $7,654 Suezmax) for the three months ended September 30, 2003 compared to $5,265 ($5,145 Aframax, $5,844 Suezmax) for the three months ended September 30, 2002 primarily as the result of an increase in maintenance and repairs within the period as well as the increase in the percentage of our fleet that consists of Suezmax vessels.

GENERAL AND ADMINISTRATIVE EXPENSES — General and administrative expenses increased by $2.6 million, or 82.5%, to $5.8 million for the three months ended September 30, 2003 compared to $3.2 million for the three months ended September 30, 2002. This increase is primarily due to an increase in payroll expenses (salaries, benefits and incentive bonus) in connection with the growth of our fleet during three months ended September 30, 2003. General and administrative expenses as a percentage of net voyage revenues decreased to 7.8% for the three months ended September 30, 2003 from 9.6% for the three months ended September 30, 2002. Daily general and administrative expenses per vessel increased $179, or 15.0%, to $1,369 for the three months ended September 30, 2003 compared to $1,190 for the three months ended September 30, 2002.

WRITE DOWN OF VESSEL — During the three months ended September 30, 2002, we recognized an expense of $4.5 million as a result of our decision to retire one vessel, the Stavanger Prince, a 1979 single-hull Aframax tanker, and sell it for scrap. This decision was based on management’s assessment of the projected costs associated with the vessel’s next dry docking, which was originally scheduled for

April 2003, and the estimated operating revenues for the vessel over its normal remaining operating life. The expense was calculated based on the difference between the carrying value of the vessel and management’s estimate of the net present value of the projected operating income and its net proceeds to be received upon disposal. No such expenses occurred during the three months ended September 30, 2003.

DEPRECIATION AND AMORTIZATION — Depreciation and amortization, which include depreciation of vessels as well as amortization of dry docking, special survey costs and loan fees, increased by $7.7 million, or 48.5%, to $23.6 million for the three months ended September 30, 2003 compared to $15.9 million for the three months ended September 30, 2002. This increase is primarily due to the growth of our fleet in the three months ended September 30, 2003 compared to the three months ended September 30, 2002.

Amortization of dry dock and repairs increased by $0.4 million, or 26.8%, to $2.0 million for the three months ended September 30, 2003 compared to $1.6 million for the three months ended September 30, 2002. This increase in amortization of drydocking is primarily due to amortization of drydocking costs that were capitalized over the past year on vessels which we are drydocking for the first time since we acquired them. We anticipate that the amortization associated with drydocking our vessels will increase in the future, as we will be drydocking for the first time vessels we acquired during 2001 and 2003.

NET INTEREST EXPENSE — Net interest expense increased by $7.0 million, or 200%, to $10.5 million for the three months ended September 30, 2003 compared to $3.5 million for the three months ended September 30, 2002. This increase is the result of a 139% increase in our weighted average outstanding debt of $728.9 million for the three months ended September 30, 2003 compared to $304.8 million for the three months ended September 30, 2002. Also contributing to the increase in net interest expense during the three months ended September 30, 2003 compared to the three months ended September 30, 2002 is the $250 million of Senior Notes we issued in March 2003 in connection with the acquisition of 19 vessels, which have a 10% coupon which is significantly higher than the interest rates on the remainder of our long-term debt.

NET INCOME — Net income was $7.0 million for the three months ended September 30, 2003 compared to a net loss of $7.9 for the three months ended September 30, 2002.

NINE MONTHS ENDED SEPTEMBER 30, 2003 COMPARED TO THE NINE MONTHS ENDED SEPTEMBER 30, 2002

VOYAGE REVENUES — Voyage revenues increased by $165.1 million, or 102%, to $327.6 million for the nine months ended September 30, 2003 compared to $162.5 million for the nine months ended September 30, 2002. $94.7 million of this increase is due to the acquisition of 14 Suezmax tankers and five Aframax tankers during 2003. In addition, voyage revenues increased by $78.4 million on the 27 tankers which were part of our fleet since January 1, 2002 to $230.5 million for the nine months ended September 30, 2003 compared to $152.1 million during the nine months ended September 30, 2002, primarily as a result of better freight rates. These increases are partially offset by the $8.0 million decrease in voyage revenues associated with two Aframax tankers sold during November 2002 and March 2003. The average size of our fleet increased 34.6% to 39.0 (25.1 Aframax, 13.9 Suezmax) tankers during the nine months ended September 30, 2003 compared to 29.0 tankers (24.0 Aframax, 5.0 Suezmax) during the comparable 2002 period.

VOYAGE EXPENSES — Voyage expenses increased $28.2 million, or 47.4%, to $87.5 million for the nine months ended September 30, 2003 compared to $59.3 million for the nine months ended September

30, 2002. $27.6 million of this increase is due to the acquisition of 14 Suezmax tankers and five Aframax tankers during 2003. In addition, voyage expenses increased by $5.9 million on the 27 tankers which were part of our fleet since January 1, 2002 to $59.1 million for the nine months ended September 30, 2003 compared to $53.2 million during the nine months ended September 30, 2002, due primarily to an increase in fuel costs. These increases are partially offset by the $5.3 million decrease in voyage expenses associated with two Aframax tankers sold during November 2002 and March 2003.

NET VOYAGE REVENUES — Net voyage revenues, which are voyage revenues minus voyage expenses, increased by $137.0 million, or 133%, to $240.1 million for the nine months ended September 30, 2003 compared to $103.1 million for the nine months ended September 30, 2002. $67.1 million of this increase is due to the acquisition of 14 Suezmax tankers and five Aframax tankers during 2003. In addition, net voyage revenues increased by $72.6 million on the 27 tankers which were part of our fleet since January 1, 2002 to $171.5 million for the nine months ended September 30, 2003 compared to $98.9 million during the nine months ended September 30, 2002, primarily as a result of better freight rates. These increases are partially offset by the $2.7 million decrease in net voyage revenues associated with two Aframax tankers sold during November 2002 and March 2003. Our average TCE rates improved 69.0% to $23,277 during the nine months ended September 30, 2003 compared to $13,777 during the nine months ended September 30, 2002.

The following is additional data pertaining to net voyage revenues:

	Nine months ended September 30,				Increase
	2003		2002		(Decrease)		% Change
Net voyage revenue (in thousands):
Time charter:
Aframax	$	31,886	$	21,787	$	10,099	46	%
Suezmax	4,607		—		4,607		n/m
Total	36,493		21,787		14,706		67	%

Spot charter:
Aframax	112,022		62,683		49,339		79	%
Suezmax	91,598		18,664		72,934		391	%
Total	203,620		81,346		122,274		150	%
TOTAL NET VOYAGE REVENUE	$	240,113	$	103,134	$	136,979	133	%

Vessel operating days:
Time charter:
Aframax	1,545		1,173		372		32	%
Suezmax	239		—		239		n/m
Total	1,784		1,173		611		52	%

Spot charter:
Aframax	5,165		4,970		195		4	%
Suezmax	3,367		1,343		2,024		151	%
Total	8,532		6,313		2,219		35	%
TOTAL VESSEL OPERATING DAYS	10,316		7,486		2,830		38	%

Time Charter Equivalent (TCE):
Time charter:
Aframax	$	20,643	$	18,574	$	2,069	11	%
Suezmax	$	19,273	$	—	$	19,273	n/m
Combined	$	20,459	$	18,574	$	1,885	10	%

Spot charter:
Aframax	$	21,687	$	12,612	$	9,075	72	%
Suezmax	$	27,208	$	13,897	$	13,311	96	%
Combined	$	23,865	$	12,886	$	10,979	85	%

TOTAL TCE	$	23,277	$	13,777	$	9,500	69	%

DIRECT VESSEL EXPENSES — Direct vessel expenses, which include crew costs, provisions, deck and engine stores, lubricating oil, insurance, maintenance and repairs increased by $22.4 million, or 53.8%, to $64.0 million for the nine months ended September 30, 2003 compared to $41.6 million for the nine months ended September 30, 2002. This increase is primarily due to the growth of our fleet, which increased 34.6% for the same periods, as well as an increase in maintenance and repairs during the nine months ended September 30, 2003 compared to the nine months ended September 30, 2002. In addition, most of this 34.6% increase in the size of our fleet relates to the acquisition of Suezmax vessels which, although generally generating higher TCE rates, are more costly to operate than Aframax vessels. On a daily basis, direct vessel expenses per vessel increased by $737, or 14.0%, to $5,990 ($5,525 Aframax, $6,826 Suezmax) for the nine months ended September 30, 2003 compared to $5,253 ($5,105 Aframax, $5,963 Suezmax) for the nine months ended September 30, 2002, primarily as the result of the an increase

in maintenance and repairs within the period as well as the increase in the percentage of our fleet that consists of Suezmax vessels.

GENERAL AND ADMINISTRATIVE EXPENSES — General and administrative expenses increased by $7.0 million, or 82.4%, to $15.6 million for the nine months ended September 30, 2003 compared to $8.6 million for the nine months ended September 30, 2002. This increase is primarily due to an increase in payroll expenses including higher incentive bonus accruals as a result of an increase in the number of personnel in connection with the growth of our fleet for nine months ended September 30, 2003 compared to the nine months ended September 30, 2002 as well as higher professional fees during 2003. General and administrative expenses as a percentage of net voyage revenues decreased to 6.5% for the nine months ended September 30, 2003 from 8.3% for the nine months ended September 30, 2002. Daily general and administrative expenses per vessel increased $381, or 35.2%, to $1,461 for the nine months ended September 30, 2003 compared to $1,080 for the nine months ended September 30, 2002.

DEPRECIATION AND AMORTIZATION — Depreciation and amortization, which include depreciation of vessels as well as amortization of dry docking, special survey costs and loan fees, increased by $14.2 million, or 31.3%, to $59.5 million for the nine months ended September 30, 2003 compared to $45.3 million for the nine months ended September 30, 2002. This increase is primarily due to the growth of our fleet during the nine months ended September 30, 2003 compared to the nine months ended September 30, 2002.

Amortization of dry dock and repairs increased by $2.2, or 76.3%, to $5.1 million for the nine months ended September 30, 2003 compared to $2.9 million for the nine months ended September 30, 2002. This increase in amortization of drydocking is primarily due to amortization of drydocking costs that were capitalized over the past year on vessels which we are drydocking for the first time since we acquired them. We anticipate that the amortization associated with drydocking our vessels will increase in the future, as we will be drydocking for the first time vessels we acquired during 2001 and 2003. In addition, as vessels age, the cost of drydocking them and the frequency of their drydockings increase, which also results in increased amortization associated with our drydockings.

WRITEDOWN (GAIN ON SALE) OF VESSELS— During the nine months ended September 30, 2003, we recognized a gain of $0.9 million as a result of our sale of the Kentucky, a 1980 single-hull Aframax tanker, which was transferred from long term assets to assets held for sale during the fourth quarter of 2002. During the fourth quarter of 2002, we recorded an expense of $4.1 million associated with the Kentucky which was the difference between the tanker’s book value at the time of $6.1 million and the estimated proceeds from its sale. The gain of $0.9 million is the difference between the actual sale price of the Kentucky and its book value at the time of the sale.

During the nine months ended September 30, 2002, we recognized an expense of $4.5 million as a result of our decision to retire one vessel, the Stavanger Prince, a 1979 single-hull Aframax tanker, and sell it for scrap. This decision was based on management’s assessment of the projected costs associated with the vessel’s next dry docking, which was originally scheduled for April 2003, and the estimated operating revenues for the vessel over its normal remaining operating life. The expense was calculated based on the difference between the carrying value of the vessel and management’s estimate of the net present value of the projected operating income and its net proceeds to be received upon disposal. No such expenses occurred during the three months ended September 30, 2003.

NET INTEREST EXPENSE — Net interest expense increased by $13.6 million, or 122%, to $24.8 million for the nine months ended September 30, 2003 compared to $11.2 million for the nine months

ended September 30, 2002. This increase is the result of a 80.5% increase in our weighted average outstanding debt of $578 million for the nine months ended September 30, 2003 compared to $320 million for the nine months ended September 30, 2002. Also contributing to the increase in net interest expense during the nine months ended September 30, 2003 compared to the nine months ended September 30, 2002 is the $250 million of Senior Notes we issued in March 2003, which have a 10% coupon which is significantly higher than the interest rates on the remainder of our long-term debt.

NET INCOME — Net income was $77.2 million for the nine months ended September 30, 2003 compared to net loss of $8.0 million for the nine months ended September 30, 2002.

LIQUIDITY AND CAPITAL RESOURCES

Since our formation, our principal source of funds has been equity financings, cash flows from operating activities and long-term borrowings. Our principal use of funds has been capital expenditures to establish and grow our fleet, maintain the quality of our vessels, comply with international shipping standards and environmental laws and regulations, fund working capital requirements and make principal repayments on outstanding loan facilities. We expect to rely upon operating cash flows as well as long-term borrowings, and future offerings to implement our growth plan. We believe that our current cash balance as well as cash flows from operating activities and available borrowings under our credit facilities will be sufficient to meet our liquidity needs for the next year.

Our practice has been to acquire tankers using a combination of funds received from equity and bond investors as well as bank debt which is secured by mortgages on our tankers and the shares of common stock of our shipowning subsidiaries. Our business is capital intensive and its future success will depend on our ability to maintain a high-quality fleet through the acquisition of newer tankers and the selective sale of older tankers. These acquisitions will be principally subject to management’s expectation of future market conditions as well as our ability to acquire tankers on favorable terms.

Cash increased to $15.3 million as of September 30, 2003 compared to $2.7 million as of December 31, 2002. Working capital is current assets minus current liabilities, including the current portion of long-term debt. Working capital deficit was $11.9 million as of September 30, 2003, compared to a working capital deficit of $33.7 million as of December 31, 2002. The current portion of long-term debt included in our current liabilities was $53.6 million as of September 30, 2003 and $ 62.0 million as of December 31, 2002.

EBITDA, as defined in Note 1 to the “Selected Consolidated Financial and Other Data” table above increased by $29.7 million, or 259%, to $41.2 million for the three months ended September 30, 2003 from $11.5 million for the three months ended September 30, 2002. This increase is due to the growth of our fleet and stronger spot freight rate market. On a daily basis, EBITDA per vessel increased by $5,435, or 127%, to $9,728 for the three months ended September 30, 2003 from $4,293 for the three months ended September 30, 2002.

EBITDA increased by $113.0 million, or 233%, to $161.5 million for the nine months ended September 30, 2003 from $48.5 million for the nine months ended September 30, 2002. This increase is due to the growth of our fleet and stronger spot freight rate market. On a daily basis, EBITDA per vessel increased by $9,000, or 147%, to $15,123 for the nine months ended September 30, 2003 from $6,123 for the nine months ended September 30, 2002.

We have three credit facilities. The first (“First”) closed on June 15, 2001, the second (“Second”) closed on June 27, 2001 and the third (“Third”) closed on March 11, 2003. The First and Second loan facilities

are comprised of a term loan and a revolving loan and the Third is comprised of a term loan. The terms and conditions of the credit facilities require compliance with certain restrictive covenants based on aggregate values and financial data for the tankers associated with each credit facility. Under the financial covenants of each of the credit facilities, the Company is required to maintain certain ratios such as: tanker market value to loan commitment, EBITDA (as defined in each credit facility) to net interest expense and to maintain minimum levels of working capital. Under the general covenants, subject to certain exceptions, we and our subsidiaries are not permitted to pay dividends.

The First credit facility is a $300 million facility, currently comprised of a $200 million term loan and a $97.6 million revolving loan and is collateralized by 18 tankers. The Second credit facility is a $165 million facility comprised of a $115 million term loan and a $50 million revolving loan and is collateralized by 9 tankers. The Third credit facility is comprised of a $275 million term loan and is collateralized by 19 tankers. All credit facilities have a five-year maturity with the term loans requiring quarterly principal repayments. The principal of each revolving loan is payable upon maturity. The First and Second credit facilities and the revolving loans bear interest at a rate of 1.5% over LIBOR payable on the outstanding principal amount. We are required to pay an annual fee of 0.625% for the unused portion of each of the revolving loans on a quarterly basis. The Third credit facility bears interest at a rate of 1.625% over LIBOR payable on the outstanding principal amount. The subsidiaries that own the tankers that collateralize each credit facility have guaranteed the loans made under the appropriate credit facility, and we have pledged the shares of those subsidiaries. We use interest rate swaps to manage the impact of interest rate changes on earnings and cash flows.

On March 20, 2003 we closed a private offering of face amount $250 million in 10% Senior Notes due 2013. Interest on the Senior Notes, which are unsecured, accrues at the rate of 10% per annum, and is payable semi-annually. The Senior Notes, which do not amortize, are due on March 15, 2013. The Senior Notes are guaranteed by all of our present subsidiaries and our future “restricted” subsidiaries. The Senior Notes contain incurrence covenants which, among other things, restrict our future ability to incur future indebtedness and liens, to apply the proceeds of asset sales freely, to merge or undergo other changes of control and to pay dividends, and require us to apply a portion of our cash flow during 2003 to the reduction of our debt under our First, Second and Third facilities. We have applied the proceeds of the Senior Notes offering, together with proceeds of our Third facility and cash on hand, to purchase 19 tankers.

The sale of the Stavanger Prince during November 2002 resulted in net cash proceeds of $2.3 million of which we were required to use $1.7 million to repay long term debt of our first credit facility associated with the tanker pursuant to our loan agreements. The sale also reduced the amount that we can draw under our revolving credit facility by $1.2 million.

The sale of the Kentucky during March 2003 resulted in net cash proceeds of $2.9 million of which we were required to use $1.4 million to repay long term debt of our First credit facility associated with the tanker pursuant to our loan agreements. The sale also reduced the amount that we can draw under our revolving credit facility by $1.2 million.

In addition to tanker acquisitions, other major capital expenditures include funding our maintenance program of regularly scheduled in-water survey or drydocking necessary to preserve the quality of our tankers as well as to comply with international shipping standards and environmental laws and regulations. Management anticipates that tankers which are younger than 15 years are required to undergo in-water surveys 2.5 years after a drydock and that tankers are to be drydocked every five years, while tankers 15 years or older are to be drydocked every 2.5 years in which case the additional drydocks take the place of these in-water surveys. During 2003, we anticipate that our 46-tanker fleet will be offhire for approximately 230 days associated with drydocks and in-water surveys. Off hire time includes the actual time the tanker is in the shipyard as well as ballast time to the shipyard from the port of last discharge. The ability to meet this

maintenance schedule will depend on our ability to generate sufficient cash flows from operations or to secure additional financing. We currently anticipate that expenditures to effect these drydocks and in-water surveys will be approximately $13.0 million during 2003 of which $9.4 million was incurred during the nine months ended September 30, 2003. During 2004, we anticipate that we will drydock between eight and 13 vessels and that the expenditures to effect these drydocks will aggregate between $15 million to $20 million.

Net cash provided by operating activities increased 280% to $124.0 million for the nine months ended September 30, 2003, compared to $32.6 million for the nine months ended September 30, 2002. This increase is primarily attributable to a net income of $77.2 million and depreciation and amortization of $59.5 million for the nine months ended September 30, 2003 compared to net loss of $8.0 million and depreciation and amortization of $45.3 million for the nine months ended September 30, 2002.

Net cash used by investing activities was $526.8 million for the nine months ended September 30, 2003 compared to net cash used by investing activities of $0.2 million for the nine months ended September 30, 2002. During the nine months ended September 30, 2003, we expended $528.4 million for the purchase of 19 tankers and received $2.9 million from the sale of a vessel.

Net cash provided by financing activities was $415.4 million for the nine months ended September 30, 2003 compared to net cash used by financing activities of $45.3 million for the nine months ended September 30, 2002. The change in cash provided by financing activities relates to the following:

• Net proceeds from borrowing under long-term debt during the nine months ended September 30, 2003 aggregated $521.2 million consisting of $246.2 million of proceeds from the issuance of Senior Notes and $275.0 million of borrowings under our Third Credit Facility.

• Principal repayments of long-term debt aggregated $91.3 million, which consisted of $64.2 million of scheduled principal repayments under our First, Second and Third Credit Facilities and $27.1 million of net payments made under our revolving credit facilities. During the nine months ended September 30, 2002, principal repayments under our First and Second Credit Facilities aggregated $54.8 million.

• During the nine months ended September 30, 2003 and 2002, payments for deferred financing costs aggregated $14.5 million and $0.1 million, respectively.

Our operation of ocean-going tankers carries an inherent risk of catastrophic marine disasters and property losses caused by adverse severe weather conditions, mechanical failures, human error, war, terrorism and other circumstances or events. In addition, the transportation of crude oil is subject to business interruptions due to political circumstances, hostilities among nations, labor strikes and boycotts. Our current insurance coverage includes (1) protection and indemnity insurance coverage for tort liability, which is provided by mutual protection and indemnity associations, (2) hull and machinery insurance for actual or constructive loss from collision, fire, grounding and engine breakdown, (3) war risk insurance for confiscation, seizure, capture, vandalism, sabotage and other war-related risks and (4) loss of hire insurance for loss of revenue for up to 90 days resulting from tanker off hire for all of our tankers. In light of overall economic conditions as well as recent international events, including the attack on the VLCC Limburg in Yemen in October 2002, and the related risks with respect to the operation of ocean-going tankers and transportation of crude oil, we have been be required to pay higher premiums with respect to our insurance coverage in 2003 and may be subject to increased supplemental calls with respect to its protection and indemnity insurance coverage payable to protection and indemnity associations in amounts based on our own claim records as well as the claim records of the other members of those associations related to prior year periods of operations. We

believe that the increase in insurance premiums and supplemental calls is industry wide and do not foresee that it will have a material adverse impact on our tanker operations or overall financial performance. To the extent such costs cannot be passed along to our customers, such costs will reduce our operating income.

Critical Accounting Policies

The discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States, or GAAP. The preparation of those financial statements requires us to make estimates and judgments that affect the reported amount of assets and liabilities, revenues and expenses and related disclosure of contingent assets and liabilities at the date of our financial statements. Actual results may differ from these estimates under different assumptions or conditions.

Critical accounting policies are those that reflect significant judgments or uncertainties, and potentially result in materially different results under different assumptions and conditions. We have described below what we believe are our most critical accounting policies. We believe that there has been no change in or additions to our critical accounting policies since December 2001.

ALLOWANCE FOR DOUBTFUL ACCOUNTS. We do not provide any reserve for doubtful accounts associated with our voyage revenues because we believe that our customers are of high creditworthiness and there are no serious issues concerning collectibility. We have had an excellent collection record during the past three years ended December 31, 2002 and the nine months ended September 30, 2003. To the extent that some voyage revenues become uncollectible, the amounts of these revenues would be expensed at that time. We provide a reserve for our demurrage revenues based upon our historical record of collecting these amounts. As of September 30, 2003, we provided a reserve of approximately 10% for these claims, which we believe is adequate in light of our collection history. We periodically review the adequacy of this reserve so that it properly reflects our collection history. To the extent that our collection experience warrants a greater reserve we will incur an expense as to increase of this amount in that period.

DEPRECIATION AND AMORTIZATION. We record the value of our tankers at their cost (which includes acquisition costs directly attributable to the tanker and expenditures made to prepare the tanker for its initial voyage) less accumulated depreciation. We depreciate our tankers on a straight-line basis over their estimated useful lives, estimated to be 25 years from date of initial delivery from the shipyard. We believe that a 25-year depreciable life is consistent with that of other ship owners. Depreciation is based on cost less the estimated residual scrap value. We estimate residual scrap value as the lightweight tonnage of each tanker multiplied by $125 scrap value per ton, which we believe approximates the historical average price of scrap steel. An increase in the useful life of the tanker would have the effect of decreasing the annual depreciation charge and extending it into later periods. An increase in the residual value would decrease the amount of the annual depreciation charge. A decrease in the useful life of the tanker would have the effect of increasing the annual depreciation charge. A decrease in the residual value would increase the amount of the annual depreciation charge.

REPLACEMENTS, RENEWALS AND BETTERMENTS. We capitalize and depreciate the costs of significant replacements, renewals and betterments to our tankers over the shorter of the tanker’s remaining useful life or the life of the renewal or betterment. The amount capitalized is based on our judgment as to expenditures that extend a tanker’s useful life or increase the operational efficiency of a tanker. We believe that these criteria are consistent with GAAP and that our policy of capitalization reflects the economics and market values of our tankers. Costs that are not depreciated are written off as a component of direct vessel operating expense during the period incurred. Expenditures for routine

maintenance and repairs are expensed as incurred. If the amount of the expenditures we capitalize for replacements, renewals and betterments to our tankers were reduced, we would recognize the amount of the difference as an expense.

DEFERRED DRYDOCK COSTS. Our tankers are required to be drydocked for major repairs and maintenance that cannot be performed while the tankers are operating approximately every 30 to 60 months. We capitalize the costs associated with the drydocks as they occur and amortize these costs on a straight line basis over the period between drydocks. Costs capitalized as part of the drydock include actual costs incurred at the drydock yard; cost of fuel consumed between the tanker’s last discharge port prior to the drydock and the time the tanker leaves the drydock yard; cost of hiring riding crews to effect repairs on a ship and parts used in making such repairs that are reasonably made in anticipation of reducing the duration or cost of the drydock; cost of travel, lodging and subsistence of our personnel sent to the drydock site to supervise; and the cost of hiring a third party to oversee a drydock. We believe that these criteria are consistent with GAAP guidelines and industry practice, and that our policy of capitalization reflect the economics and market values of the tankers.

IMPAIRMENT OF LONG-LIVED ASSETS. We evaluate the carrying amounts and periods over which long-lived assets are depreciated to determine if events have occurred which would require modification to their carrying values or useful lives. In evaluating useful lives and carrying values of long-lived assets, we review certain indicators of potential impairment, such as undiscounted projected operating cash flows, tanker sales and purchases, business plans and overall market conditions. We determine undiscounted projected net operating cash flows for each tanker and compare it to the tanker carrying value. In the event that impairment occurred, we would determine the fair value of the related asset and we record a charge to operations calculated by comparing the asset’s carrying value to the estimated fair value. We estimate fair value primarily through the use of third party valuations performed on an individual tanker basis.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURE OF MARKET RISK

Interest Rate Risk

We are exposed to various market risks, including changes in interest rates. The exposure to interest rate risk relates primarily to our debt. At September 30, 2003, we had $463.7 million of floating rate debt with margins over LIBOR ranging between 1.5% and 1.625% compared to $280.0 million as of December 31, 2002. We use interest rate swaps to manage the impact of interest rate changes on earnings and cash flows. The differential to be paid or received under these swap agreements is accrued as interest rates change and is recognized as an adjustment to interest expense. As of September 30, 2003 and December 31, 2002, we were party to interest rate swap agreements having aggregate notional amounts of $78.0 million and $102.8 million, respectively, which effectively fixed LIBOR on a like amount of principal at rates ranging from 3.985% to 4.75%. If we terminate these swap agreements prior to their maturity, we may be required to pay or receive an amount upon termination based on the prevailing interest rate, time to maturity and outstanding notional principal amount at the time of termination. As of September 30, 2003 the fair value of these swaps was a net liability to us of $3.3 million. A one percent increase in LIBOR would increase interest expense on the portion of our $385.7 million outstanding floating rate indebtedness that is not hedged by approximately $3.9 million per year from September 30, 2003.

Foreign Exchange Rate Risk

The international tanker industry’s functional currency is the U.S. dollar. As virtually all of our revenues and most of our operating costs are in U.S. dollars, we believe that our exposure to foreign exchange rate risk is insignificant.

Item 4. CONTROLS AND PROCEDURES

As of the end of the period covered by this report, under the supervision and with the participation of management, including the Company’s Chief Executive Officer and its Chief Financial Officer, the Company has evaluated the effectiveness of the design and operation of its disclosure controls and procedures pursuant to Rule 13a-15 of the Securities Exchange Act of 1934. Based upon that evaluation, the Company’s Chief Executive Officer and its Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are effective in timely alerting them at a reasonable assurance level to material information relating to the Company required to be included in its periodic Securities Exchange Commission filings. There have been no significant changes in the Company’s internal controls that could significantly affect internal controls subsequent to the date of their evaluation.

PART II: OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are not aware of any material pending legal proceedings, other than ordinary routine litigation incidental to our business, to which we or our subsidiaries are a party or of which our property is the subject. From time to time in the future, we may be subject to legal proceedings and claims in the ordinary course of business, principally personal injury and property casualty claims. Those claims, even if lacking merit, could result in the expenditure by us of significant financial and managerial resources.

In our quarterly report for the three month period ending March 31, 2003, we reported the settlement of two separate litigation matters to which we were a party. The first matter involved the charter of our tanker Genmar Harriet to OMI Corporation. The second matter related to an incident involving our tanker Genmar Hector at the BPAmoco Co. unloading terminal in Texas City, Texas in March 2001.

ITEM 5. OTHER INFORMATION

In compliance with Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, we have provided certifications of our Principal Executive Officer and Principal Financial Officer to the Securities and Exchange Commission. The certifications provided pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 accompanying this report have not been filed pursuant to the Securities Exchange Act of 1934.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a) Exhibits:

Exhibit		Description

31.1		Certification of Principal Executive Officer pursuant to Section 302

		of the Sarbanes-Oxley Act of 2002.

31.2		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1		Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

(b) Reports on Form 8-K:

Date of Report		Description

July 10, 2003		Press release announcing the commencement of the Company’s exchange offer for all of its outstanding 10% senior notes due March 15, 2013, for an equal principal amount of 10% senior notes due March 15, 2013, registered under the Securities Act of 1933, as amended

July 23, 2003		Press release announcing the Company’s results of operations for the quarter ending June 30, 2003.

September 5, 2003		Press release announcing the completion of the Company’s exchange offer for all of its outstanding 10% senior notes due March 15, 2013, for an equal principal amount of 10% senior notes due March 15, 2013, registered under the Securities Act of 1933, as amended.

The Company hereby incorporates by reference this Report on Form 10-Q into its Registration Statement on Form S-4, as amended (Reg. No. 333-106350).

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	GENERAL MARITIME CORPORATION


	By:	/s/ Peter C. Georgiopoulos
Date: November 13, 2003	Peter C. Georgiopoulos

	Chairman, Chief Executive Officer, and President