Edgar Filing: AEGEAN MARINE PETROLEUM NETWORK INC.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO
RULE 13A-16 OR 15D-16 UNDER THE SECURITIES
EXCHANGE ACT OF 1934

For the month of August 2016

Commission File Number: 001-33179

AEGEAN MARINE PETROLEUM NETWORK INC.

(Translation of registrant's name into English)

10, Akti Kondili
185 45, Piraeus
Greece

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F [ X ] Form 40-F [ ]

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ________.

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ________.

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant's "home country"), or under the rules of the home country exchange on which the registrant's securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant's security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

INFORMATION CONTAINED IN THIS FORM 6-K REPORT

Attached as Exhibit 1 to this Report on Form 6-K is a copy of the press release of Aegean Marine Petroleum Network Inc. (the "Company"), dated August 10, 2016, announcing the Company's financial and operating results for the second quarter ended June 30, 2016.

Attached as Exhibit 2 is a copy of the Company's consolidated financial statements.

SIGNATURES

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.

	AEGEAN MARINE PETROLEUM NETWORK INC. (registrant)




Dated: August 10, 2016	By: /s/ E. Nikolas Tavlarios
	Name: E. Nikolas Tavlarios Title: President

Exhibit 1

Aegean Marine Petroleum Network Inc.

Announces Second Quarter 2016 Financial Results

Achieves record adjusted EBITDA results of $37.9 million

Delivers sequential quarter of more than 4 million metric tons of bunker fuel sales

New York, NY, August 10, 2016 – Aegean Marine Petroleum Network Inc. (NYSE: ANW) ("Aegean" or the "Company") today announced financial and operating results for the second quarter ended June 30, 2016.

Second Quarter Financial Highlights

Compared to prior year period:

Increased sales volumes by 29.9% to 4,092,789 metric tons.

Increased gross profit by 19.0% to $93.4 million compared to prior year.

Increased operating income by 95.3% to $28.9 million.

Increased operating income adjusted for a loss on sale of non-core vessels by 111.5% to $31.3 million.

Recorded GAAP net income attributable to Aegean shareholders of $13.5 million or $0.27 basic and diluted earnings per share.

Net income adjusted for a loss on sale of non-core vessels was $16.0 million or $0.32 basic and diluted earnings per share.

Generated record adjusted EBITDA of $37.9 million.

Sold two non-core vessels, enabling $5 million in debt pay down, which is expected to result in operating cost reductions of approximately $6.4 million on an annual basis.

Second Quarter Operational Highlights

Ramped-up operations in Algoa Bay, South Africa, further expanding global platform.

Further optimized operations through the sale of two non-core vessels.

Strategically relocated certain vessels from lower-activity markets to higher-growth regions.

E. Nikolas Tavlarios, Aegean's President, commented, "We generated strong operational and financial results in the quarter and are pleased with the momentum we have going into the second half of the year. During the second quarter we increased sales volumes and improved performance in many key markets, including our new operations in South Africa and Brazil. Our top- and bottom-line results benefitted from our initiatives to strengthen our global platform and optimize our geographic footprint. Our decisions to sell non-core vessels will result in cost reductions and align with our focus on strategically allocating our resources to swiftly respond to fluctuations in demand and capitalize on opportunities in markets where we see the most potential."

Mr. Tavlarios concluded, "We are seeing strong indications of continued growth for the full year 2016 and remain confident in our ability to drive profitability and increase volumes across our platform to deliver enhanced shareholder value."

Generating Solid Financial Results

Revenue – The Company reported total revenue of $987.6 million for the second quarter of 2016, a decrease of 18.2% compared to the same period in 2015, primarily due to the drop in oil prices. Voyage and other revenues decreased to $19.8 million or by 8.8% compared to the same period in 2015.

Gross Profit – Gross Profit, which equals total revenue less directly attributable cost of revenue increased by 19.0% to $93.4 million in the second quarter of 2016 compared to $78.5 million in the same period in 2015.

Operating Expense – The Company reported operating expense of $64.5 million for the second quarter of 2016, an increase of $0.8 million or 1.3% compared to the same period in prior year. Adjusting for the sale of non-core assets, operating expense was $62.1 million, a decrease of 2.5% compared to the same period in the prior year.

Operating Income – Operating income for the second quarter of 2016 adjusted for the sale of non-core assets was $31.3million, an increase of 111.5% compared to the same period in the prior year.

Net Income – Net income attributable to Aegean shareholders adjusted for the sale of non-core vessels was $16.0 million, or $0.32 basic and diluted earnings per share, an increase of $8.9 million or 125.4% compared to the same period in 2015.

Operational Metrics

Sales Volume – For the three months ended June 30, 2016, the Company reported marine fuel sales volumes of 4,092,789 metric tons, an increase of 29.9% compared to the same period in 2015.

Adjusted EBITDA Per Metric Ton of Marine Fuel Sold – For the three months ended June 30, 2016, the Company reported adjusted EBITDA per metric ton of marine fuel sold of $9.26. Adjusted EBITDA per metric ton of marine fuel sold in the prior year period was $7.63 per metric ton.

Gross Spread Per Metric Ton of Marine Fuel Sold – For the three months ended June 30, 2016, the Company reported gross spread per metric ton of marine fuel sold on an aggregate basis of $20.9. Gross spread per metric ton of marine fuel sold in the prior year period was $22.5.

Liquidity and Capital Resources

Net cash used in operating activities was $60.4 million for the three months ended June 30, 2016. Net income as adjusted for non-cash items (as defined in Note 9 below) was $37.1 million for the same period.

Net cash provided by investing activities was $7.9 million for the three months ended June 30, 2016, primarily due to the sale of two non-core vessels.

Net cash provided by financing activities was $44.5 million for the three months ended June 30, 2016, mainly due to the drawdown of short-term debt.

As of June 30, 2016, the Company had cash and cash equivalents of $127.8 million and working capital of $387.6 million. Non-cash working capital, or working capital excluding cash and debt, was $581.6 million.

As of June 30, 2016, the Company had $867.8 million of undrawn amounts under its working capital facilities and $127.8 million of unrestricted cash and cash equivalents to finance working capital requirements.

The weighted average basic and diluted shares outstanding for the three months ended June 30, 2016, was 48,117,508. The weighted average basic and diluted shares outstanding for the three months ended June 30, 2015 was 47,366,134.

Spyros Gianniotis, Aegean's Chief Financial Officer, stated, "During the quarter, we achieved strong adjusted EBITDA per metric ton of marine fuel sold of $9.26, a 43.8% increase quarter over quarter. While we achieved strong results across the board, we believe adjusted EBITDA per metric ton of marine fuel sold best reflects our operational improvements. In the second quarter we also reported a 29.9% year over year increase in volumes and improved performance without increase in operating expenses. Financial flexibility and a strong balance sheet remain important differentiators for our business. The two vessel sales during the quarter enabled us to pay down $5 million of debt and is expected to help eliminate approximately $6.4 million in operating costs on an annual basis. We have and intend to continue to actively manage our business while de-levering and strengthening our balance sheet to drive results for all Aegean shareholders."

Summary Consolidated Financial and Other Data (Unaudited)

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2015			2016			2015			2016
	(in thousands of U.S. dollars, unless otherwise stated)
Income Statement Data:
Revenues - third parties	$	1,203,100		$	982,337		$	2,214,056		$	1,730,853
Revenues - related companies		4,607			5,219			8,754			9,635
Total revenues		1,207,707			987,556			2,222,810			1,740,488
Cost of revenues - third parties		1,078,112			876,495			1,970,384			1,538,121
Cost of revenues– related companies		51,114			17,682			93,323			28,120
Total cost of revenues		1,129,226			894,177			2,063,707			1,566,241
Gross profit		78,481			93,379			159,103			174,247
Operating expenses:
Selling and distribution		52,744			49,943			102,561			100,715
General and administrative		10,602			11,823			20,908			23,319
Amortization of intangible assets		375			297			749			597
Loss on sale of vessels		-			2,437			130			2,437
Operating income		14,760			28,879			34,755			47,179
Net financing cost		(8,813	)		(12,477	)		(18,139	)		(21,838	)
Foreign exchange gains / (losses), net		658			(1,922	)		692			(1,683	)
Income tax benefit / (expense)		543			(947	)		2,064			1,645
Net income		7,148			13,533			19,372			25,303
Less income attributable to non-controlling interest		-			8			-			8
Net income attributable to AMPNI shareholders	$	7,148		$	13,525		$	19,372		$	25,295
Basic earnings per share (U.S. dollars)	$	0.15		$	0.27		$	0.40		$	0.51
Diluted earnings per share (U.S. dollars)	$	0.15		$	0.27		$	0.40		$	0.51

EBITDA⁽¹⁾	$	24,052		$	35,459		$	51,859		$	62,606

Other Financial Data:
Gross spread on marine petroleum products⁽²⁾	$	71,773		$	86,504		$	143,383		$	161,572
Gross spread on lubricants⁽²⁾		949			1,031			2,188			1,765
Gross spread on marine fuel⁽²⁾		70,824			85,473			141,195			159,807
Gross spread per metric ton of marine fuel sold (U.S. dollars)⁽²⁾		22.5			20.9			23.3			19.2
Net cash used in operating activities	$	(59,301	)	$	(60,441	)	$	(83,052	)	$	(49,497	)
Net cash (used in) / provided by investing activities		(4,784	)		7,878			(7,628	)		(877	)
Net cash provided by financing activities		11,822			44,515			6,671			38,491

Sales Volume Data (Metric Tons):⁽³⁾
Total sales volumes		3,150,950			4,092,789			6,066,400			8,305,425

Other Operating Data:
Number of owned bunkering tankers, end of period⁽⁴⁾		49.0			47.0			49.0			47.0
Average number of owned bunkering tankers⁽⁴⁾⁽⁵⁾		49.0			48.4			48.5			48.7
Special Purpose Vessels, end of period⁽⁶⁾		1.0			1.0			1.0			1.0
Number of operating storage facilities, end of period⁽⁷⁾		15.0			14.0			15.0			14.0

Summary Consolidated Financial and Other Data (Unaudited)

	As of December 31, 2015			As of June 30, 2016

	(in thousands of U.S. dollars, unless otherwise stated)
Balance Sheet Data:
Cash and cash equivalents		139,314			127,751
Gross trade receivables		317,152			405,399
Allowance for doubtful accounts		(7,278	)		(8,604	)
Inventories		114,531			168,170
Current assets		730,950			857,570
Total assets		1,450,011			1,558,961
Trade payables		72,417			108,572
Current liabilities (including current portion of long-term debt)		389,109			469,928
Total debt		710,015			758,596
Total liabilities		828,485			909,546
Total stockholder's equity		621,526			649,415

Working Capital Data:
Working capital⁽⁸⁾		341,841			387,642
Working capital excluding cash and debt⁽⁸⁾		477,594			581,642

Notes:

EBITDA represents net income before interest, taxes, depreciation and amortization. EBITDA does not represent and should not be considered as an alternative to net income or cash flow from operations, as determined by United States generally accepted accounting principles, or U.S. GAAP, and our calculation of EBITDA may not be comparable to that recorded by other companies. Adjusted EBITDA represents net income before interest, taxes, depreciation and amortization, vessel and investment impairments, gains/losses on vessel disposals and other non-recurring exceptional items. EBITDA and adjusted EBITDA are included herein because they are a basis upon which the Company assesses its operating performance.

Adjusted EBITDA per metric ton of marine fuel sold represents the net income before interest, taxes, depreciation and amortization, vessel and investment impairments, gains/losses on vessel disposals and other non-recurring exceptional items the Company generates per metric ton of marine fuel sold. The Company calculates adjusted EBITDA per metric ton of marine fuel sold by dividing the EBITDA by the sales volume of marine fuel. Marine fuel sales do not include sales of lubricants.

The following table reconciles net income attributable to AMPNI to EBITDA, adjusted EBITDA and adjusted EBITDA per metric ton of marine fuel sold for the periods presented:

	For the Three Months Ended June 30,					For the Six Months Ended June 30,
	2015			2016		2015			2016
	(in thousands of U.S. dollars, unless otherwise stated)
Net income to AMPNI shareholders		7,148			13,525		19,372			25,295

Add: Net financing cost including amortization of financing costs		8,813			12,447		18,139			21,838
Add: Income tax (benefit) / expense		(543	)		947		(2,064	)		(1,645	)
Add: Depreciation and amortization excluding amortization of financing costs		8,634			8,510		16,412			17,118

EBITDA		24,052			35,459		51,859			62,606

Add: Loss on sale of vessels		-			2,437		130			2,437
Adjusted EBITDA		24,052			37,896		51,989			65,043

Sales volume of marine fuel (metric tons)		3,150,950			4,092,789		6,066,400			8,305,425
Adjusted EBITDA per metric ton of marine fuel sold (U.S. dollars)		7.63			9.26		8.57			7.83

Gross spread on marine petroleum products represents the margin the Company generates on sales of marine fuel and lubricants. Gross spread on marine fuel represents the margin that the Company generates on sales of various classifications of marine fuel oil ("MFO") or marine gas oil ("MGO"). Gross spread on lubricants represents the margin that the Company generates on sales of lubricants. Gross spread on marine petroleum products, gross spread of MFO and gross spread on lubricants are not items recognized by U.S. GAAP and should not be considered as an alternative to gross profit or any other indicator of a Company's operating performance required by U.S. GAAP. The Company's definition of gross spread may not be the same as that used by other companies in the same or other industries. The Company calculates the above-mentioned gross spreads by subtracting from the sales of the respective marine petroleum product the cost of the respective marine petroleum product sold and cargo transportation costs. For arrangements in which the Company physically supplies the respective marine petroleum product using its bunkering tankers, costs of the respective marine petroleum products sold represents amounts paid by the Company for the respective marine petroleum product sold in the relevant reporting period. For arrangements in which the respective marine petroleum product is purchased from the Company's related company, Aegean Oil S.A., or Aegean Oil, cost of the respective marine petroleum products sold represents the total amount paid by the Company to the physical supplier for the respective marine petroleum product and its delivery to the custom arrangements, in which the Company purchases cargos of marine fuel for its floating storage facilities. Transportation costs may be included in the purchase price of marine fuels from the supplier or may be incurred separately from a transportation provider. Gross spread per metric ton of marine fuel sold represents the margin the Company generates per metric ton of marine fuel sold. The Company calculates gross spread per metric ton of marine fuel sold by dividing the gross spread on marine fuel by the sales volume of marine fuel. Marine fuel sales do not include sales of lubricants. The following table reflects the calculation of gross spread per metric ton of marine fuel sold for the periods presented:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2015			2016			2015			2016
	(in thousands of U.S. dollars, unless otherwise stated)
Sales of marine petroleum products		1,189,488			967,808			2,184,033			1,702,623
Less: Cost of marine petroleum products sold		(1,117,715	)		(881,304	)		(2,040,650	)		(1,541,051	)
Gross spread on marine petroleum products		71,773			86,504			143,383			161,572
Less: Gross spread on lubricants		(949	)		(1,031	)		(2,188	)		(1,765	)
Gross spread on marine fuel		70,824			85,473			141,195			159,507

Sales volume of marine fuel (metric tons)		3,150,950			4,092,789			6,066,400			8,305,425

Gross spread per metric ton of marine fuel sold (U.S. dollars)		22.5			20.9			23.3			19.2

Sales volume of marine fuel is the volume of sales of various classifications of MFO and MGO for the relevant period and is denominated in metric tons. The Company does not include the sales volume of lubricants in the calculation of gross spread per metric ton of marine fuel sold.

Bunkering fleet comprises both bunkering vessels and barges.

Figure represents average bunkering fleet number for the relevant period, as measured by the sum of the number of days each bunkering tanker or barge was used as part of the fleet during the period divided by the cumulative number of calendar days in the period multiplied by the number of bunkering tankers at the end of the period. This figure does not take into account non-operating days due to either scheduled or unscheduled maintenance.

Special Purpose Vessels consists of the Orion, a 550 dwt tanker which is based in our Greek market.

The Company owns two barges, the Mediterranean and Umnenga, as floating storage facilities in Greece and South Africa. The Company also operates on-land storage facilities in Las Palmas, Fujairah, Tangiers, Panama, the U.S.A., Hamburg and Barcelona.

The ownership of storage facilities allows the Company to mitigate its risk of supply shortages. Generally, storage costs are included in the price of refined marine fuel quoted by local suppliers. The Company expects that the ownership of storage facilities will allow it to convert the variable costs of this storage fee mark-up per metric ton quoted by suppliers into fixed costs of operating its owned storage facilities, thus enabling the Company to spread larger sales volumes over a fixed cost base and to decrease its refined fuel costs.

Working capital is defined as current assets minus current liabilities. Working capital excluding cash and debt is defined as current assets minus cash and cash equivalents minus restricted cash minus current liabilities plus short-term borrowings plus current portion of long-term debt.

Net income as adjusted for non-cash items, such as depreciation, provision for doubtful accounts, restricted stock, amortization, deferred income taxes, gain/loss on sale of vessels, impairment losses, unrealized loss/(gain) on derivatives and unrealized foreign exchange loss/(gain), net, is used to assist in evaluating our ability to make quarterly cash distributions. Net income as adjusted for non-cash items is not recognized by accounting principles generally accepted in the United States and should not be considered as an alternative to net income or any other indicator of the Company's performance required by accounting principles generally accepted in the United States. The following table reflects the calculation of net income as adjusted for non-cash items for the periods presented:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2015			2016			2015			2016
	(in thousands of U.S. dollars, unless otherwise stated)
Net income		7,148			13,533			19,372			25,303
Add: Depreciation		6,375			6,353			12,636			12,792
Add: Provision for doubtful accounts		765			640			1,409			1,421
Add: Share based compensation		2,304			2,179			4,965			4,588
Add: Amortization		4,530			4,585			9,014			9,151
Add: Net deferred tax expense / (benefit)		(531	)		920			(2,548	)		(1,959	)
Add: Unrealized loss on derivatives		8,230			6,566			17,239			34,194
Add: Loss on sale of vessels		-			2,437			130			2,437
Add: Unrealized foreign exchange loss / (gain)		146			(118	)		(539	)		89
Net income as adjusted for non-cash items		28,967			37,095			61,678			88,016

Second Quarter 2016 Dividend Announcement

On August 10, 2016, the Company's Board of Directors declared a second quarter 2016 dividend of $0.02 per share payable on or about September 9, 2016 to shareholders of record as of August 24, 2016. The dividend amount was determined in accordance with the Company's dividend policy of paying cash dividends on a quarterly basis subject to factors including the requirements of Marshall Islands law, future earnings, capital requirements, financial condition, future prospects and such other factors as are determined by the Company's Board of Directors. The Company anticipates retaining most of its future earnings, if any, for use in operations and business expansion.

Conference Call and Webcast Information

Aegean Marine Petroleum Network Inc. will conduct a conference call and simultaneous Internet webcast on Wednesday, August 10, 2016 at 4:30 P.M. Eastern Time, to discuss its second quarter results. Investors may access the webcast and related slide presentation, by visiting the Company's website at www.ampni.com, and clicking on the webcast link. The conference call also may be accessed via telephone by dialing (800) 524-8850 (for U.S.-based callers) or 416-204-9702 (for international callers) and enter the passcode: 2586478.

If you are unable to participate at this time, a replay of the call will be available for two weeks at 888-203-1112 or 719-457-0820. Enter the code 2586478 to access the audio replay. The webcast will also be archived on the Company's website:

http://www.ampni.com.

About Aegean Marine Petroleum Network Inc.

Aegean Marine Petroleum Network Inc. is an international marine fuel logistics company that markets and physically supplies refined marine fuel and lubricants to ships in port and at sea. The Company procures product from various sources (such as refineries, oil producers, and traders) and resells it to a diverse group of customers across all major commercial shipping sectors and leading cruise lines. Currently, Aegean has a global presence in over than 30 markets and a team of professionals ready to serve our customers wherever they are around the globe. For additional information please visit: www.ampni.com

Cautionary Statement Regarding Forward-Looking Statements

Matters discussed in this press release may constitute forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides safe harbor protections for forward-looking statements in order to encourage companies to provide prospective information about their business. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts.

The Company desires to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and is including this cautionary statement in connection with this safe harbor legislation. The words "believe," "intend," "anticipate," "estimate," "project," "forecast," "plan," "potential," "may," "should," "expect" and similar expressions identify forward-looking statements. The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, our management's examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, we cannot assure you that we will achieve or accomplish these expectations, beliefs or projections.

In addition to these important factors, other important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include our ability to manage growth, our ability to maintain our business in light of our proposed business and location expansion, our ability to obtain double hull secondhand bunkering tankers, the outcome of legal, tax or regulatory proceedings to which we may become a party, adverse conditions in the shipping or the marine fuel supply industries, our ability to retain our key suppliers and key customers, material disruptions in the availability or supply of crude oil or refined petroleum products, changes in the market price of petroleum, including the volatility of spot pricing, increased levels of competition, compliance or lack of compliance with various environmental and other applicable laws and regulations, our ability to collect accounts receivable, changes in the political, economic or regulatory conditions in the markets in which we operate, and the world in general, our failure to hedge certain financial risks associated with our business, our ability to maintain our current tax treatments and our failure to comply with restrictions in our credit agreements and other factors. Please see our filings with the Securities and Exchange Commission for a more complete discussion of these and other risks and uncertainties.

CONTACTS:

Aegean Marine Petroleum Network Inc.

(212) 430-1098

Exhibit 2

AEGEAN MARINE PETROLEUM NETWORK INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

AS OF JUNE 30, 2016 AND DECEMBER 31, 2015

(UNAUDITED)

(Expressed in thousands of U.S. dollars – except for share and per share data)

	June 30, 2016			December 31, 2015
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	127,751		$	139,314
Trade receivables, net of allowance for doubtful accounts of $8,604 and $7,278, as of June 30, 2016 and December 31, 2015, respectively		396,795			309,874
Trade receivables from related parties		15,013			18,963
Due from related companies		9,314			6,887
Derivative asset		-			22,416
Inventories		168,170			114,531
Prepayments and other current assets, net of allowances for doubtful accounts of $565 as of June 30, 2016 and December 31, 2015		133,309			116,004
Deferred tax asset		1,651			2,133
Restricted cash		5,451			828
Vessel held for sale		116			-
Total current assets		857,570			730,950

FIXED ASSETS:
Advances for other fixed assets under construction		398			398
Vessels, cost		469,641			480,346
Vessels, accumulated depreciation		(107,342	)		(109,328	)
Vessels' net book value		362,299			371,018
Other fixed assets, net		242,706			246,783
Total fixed assets		605,403			618,199

OTHER NON-CURRENT ASSETS:
Deferred charges, net		21,022			25,007
Intangible assets		8,181			8,778
Goodwill		66,031			66,031
Other non-current assets		754			1,046
Total non-current assets		95,988			100,862

Total assets		1,558,961			1,450,011

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Short-term borrowings		299,958			249,497
Current portion of long-term debt		27,244			26,398
Trade payables to third parties		108,513			72,413
Trade payables to related companies		59			4
Other payables to related companies		1,155			1,186
Deferred tax liability		-			990
Derivative liability		7,821			-
Accrued and other current liabilities		25,178			38,621
Total current liabilities		469,928			389,109

NON-CURRENT LIABILITIES:
Long-term debt, net of current portion and deferred financing costs		431,394			434,120
Deferred tax liability		1,112			2,563
Derivative liability		4,377			420
Other non-current liabilities		2,735			2,273
Total non-current liabilities		439,618			439,376

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
Preferred stock, $0.01 par value; 25,000,000 shares authorized, none issued		-			-
Common stock, $0.01 par value; 100,000,000 shares authorized at June 30, 2016 and December 31, 2015; 52,667,492 and 51,382,492 shares issued and 50,695,853 and 49,410,853 shares outstanding at June 30, 2016 and December 31, 2015, respectively		526			514
Treasury stock $0.01 par value; 1,971,639 shares, repurchased at June 30, 2016 and December 31, 2015		(29,327	)		(29,327	)
Additional paid-in capital		398,644			394,068
Retained earnings		279,564			256,271
Total AMPNI stockholders' equity		649,407			621,526
Non-controlling interest		8			-
Total equity		649,415			621,526
Total liabilities and equity	$	1,558, 961		$	1,450,011

The accompanying notes are an integral part of these condensed consolidated financial statements

AEGEAN MARINE PETROLEUM NETWORK INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

FOR THE SIX MONTHS ENDED JUNE 30, 2016 AND 2015

(UNAUDITED)

(Expressed in thousands of U.S. dollars – except for share and per share data)

	Six Months Ended June 30,
	2016			2015
Revenues
Revenues – third parties	$	1,730,853		$	2,214,056
Revenues – related companies		9,635			8,754
Total Revenues		1,740,488			2,222,810

Cost of Revenues
Cost of revenues– third parties		1,538,121			1,970,384
Cost of revenues – related companies		28,120			93,323
Total Cost of Revenues		1,566,241			2,063,707

Gross Profit		174,247			159,103

OPERATING EXPENSES:
Selling and distribution		100,715			102,561
General and administrative		23,319			20,908
Amortization of intangible assets		597			749
Loss on sale of vessels		2,437			130
Total operating expenses		127,068			124,348

Operating income		47,179			34,755

OTHER INCOME / (EXPENSE):
Interest and finance costs		(21,937	)		(18,183	)
Interest income		99			44
Foreign exchange (losses) / gains, net		(1,683	)		692
Total other expense, net		(23,521	)		(17,447	)

Income before income taxes		23,658			17,308

Income taxes		1,645			2,064

Net income		25,303			19,372
Net income attributable to non-controlling interest		8			-
Net income attributable to AMPNI shareholders	$	25,295		$	19,372

Basic earnings per common share	$	0.51		$	0.40
Diluted earnings per common share	$	0.51		$	0.40

Weighted average number of shares, basic		47,831,606			47,104,784
Weighted average number of shares, diluted		47,831,606			47,104,784

The accompanying notes are an integral part of these condensed consolidated financial statements

AEGEAN MARINE PETROLEUM NETWORK INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

FOR THE SIX MONTHS ENDED JUNE 30, 2016 AND 2015

(UNAUDITED)

(Expressed in thousands of U.S. dollars – except for share and per share data)

	Common Stock				Treasury Stock						Additional Paid-in Capital		Retained Earnings			Non-Controlling Interest		Total
	Number of Shares		Par Value		Number of Shares			Value

BALANCE, December 31, 2014		50,242,992		502		(1,971,639	)		(29,327	)		371,924		224,317			-	$	567,416

- Net income		-		-		-			-			-		19,372					19,372
- Dividends declared and paid ($0.04 per share)		-		-		-			-			-		(1,950	)		-		(1,950	)
Equity component of convertible notes		-		-		-			-			12,114		-			-		12,114
- Share-based compensation		932,500		10		-			-			4,955		-			-		4,965
BALANCE, June 30, 2015		51,175,492		512		(1,971,639	)		(29,327	)		388,993		241,739			-	$	601,917

	Common Stock				Treasury Stock						Additional Paid-in Capital		Retained Earnings			Non-Controlling Interest		Total
	Number of Shares		Par Value		Number of Shares			Value

BALANCE, December 31, 2015		51,382,492		514		(1,971,639	)		(29,327	)		394,068		256,271			-	$	621,526

- Net income		-		-		-			-			-		25,295			8		25,303
- Dividends declared and paid ($0.04 per share)		-		-		-			-			-		(2,002	)		-		(2,002	)
- Share-based compensation		1,285,000		12		-			-			4,576		-			-		4,588

BALANCE, June 30, 2016		52,667,492		526		(1,971,639	)		(29,327	)		398,644		279,564			8	$	649,415

The accompanying notes are an integral part of these condensed consolidated financial statements

AEGEAN MARINE PETROLEUM NETWORK INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE SIX MONTHS ENDED JUNE 30, 2016 AND 2015

(UNAUDITED)

(Expressed in thousands of U.S. dollars)

	Six Months Ended June 30,
	2016			2015
Cash flows from operating activities:
Net income	$	25,303		$	19,372
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation		12,792			12,636
Provision of doubtful accounts		1,421			1,409
Share-based compensation		4,588			4,965
Amortization		9,151			9,014
Net deferred tax benefit		(1,959	)		(2,548	)
Unrealized loss on derivatives		34,194			17,239
Loss on sale of vessels		2,437			130
Unrealized foreign exchange loss / (gain)		89			(539	)
Decrease / (Increase) in:
Trade receivables		(84,712	)		(68,989	)
Due from related companies		(2,427	)		(9,112	)
Inventories		(53,639	)		(49,200	)
Prepayments and other current assets		(17,305	)		9,901
Increase/ (Decrease) in:
Trade payables		36,155			3,449
Other payables to related companies		(31	)		(825	)
Accrued and other current liabilities		(13,670	)		(24,407	)
Decrease in other non-current assets		292			130
Increase in other non-current liabilities		462			157
Payments for dry-docking		(2,638	)		(5,834	)
Net cash used in operating activities		(49,497	)		(83,052	)

Cash flows from investing activities:
Advances for vessels under construction		-			(2,979	)
Vessel acquisitions		(8,667	)		-
Advances for other fixed assets under construction		-			(5,140	)
Net proceeds from sale of vessels		7,942			49
Purchase of other fixed assets		(150	)		(308	)
(Increase) / Decrease in restricted cash		(2	)		750
Net cash used in investing activities		(877	)		(7,628	)

Cash flows from financing activities:
Proceeds from long-term debt		13,000			53,613
Repayment of long-term debt		(17,987	)		(19,176	)
Net change in short-term borrowings		50,461			(23,595	)
Increase in restricted cash		(4,621	)		-
Financing costs paid		(360	)		(2,221	)
Dividends paid		(2,002	)		(1,950	)
Net cash provided by financing activities		38,491			6,671

Effect of exchange rate changes on cash and cash equivalents		320			(3,332	)

Net (decrease) in cash and cash equivalents		(11,563	)		(87,341	)
Cash and cash equivalents at beginning of period		139,314			129,551
Cash and cash equivalents at end of period	$	127,751		$	42,210

The accompanying notes are an integral part of these condensed consolidated financial statements

AEGEAN MARINE PETROLEUM NETWORK INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (Continued)

(Expressed in thousands of U.S. dollars –

except share and per share data, unless otherwise stated)

1.	Basis of presentation and general information:

The accompanying unaudited condensed consolidated financial statements include the accounts of Aegean Marine Petroleum Network Inc. ("Aegean" or "AMPNI") and its subsidiaries (Aegean and its subsidiaries are hereinafter collectively referred to as the "Company") and have been prepared in accordance with U.S. generally accepted accounting principles ("US GAAP") for interim financial information. Accordingly, they do not include all the information and notes required by US GAAP for complete financial statements.

These unaudited condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and, in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, considered necessary for a fair statement of33 the Company's financial position, results of operations and cash flows for the periods presented. Operating results for the six months ended June 30, 2016 are not necessarily indicative of the results that might be expected for the fiscal year ending December 31, 2016.

These unaudited condensed consolidated financial statements presented in this report should be read in conjunction with the audited consolidated financial statements included in the Company's Annual Report on Form 20-F for the year ended December 31, 2015.

The carrying amounts of cash and cash equivalents, trade accounts receivable, and trade accounts payable reported in the condensed consolidated balance sheets approximate their respective fair values because of the short term nature of these accounts. The fair value of revolving credit facilities is estimated based on current rates offered to the Company for similar debt of the same remaining maturities. The carrying value approximates the fair market value for the floating rate loans due to their variable interest rate, being EURIBOR, LIBOR or EIBOR. LIBOR, EURIBOR and EIBOR rates are observable at commonly quoted intervals for the full terms of the loans and hence floating rate loans are considered Level 2 items in accordance with the fair value hierarchy. The estimated fair value of the Convertible Senior Notes at June 30, 2016 and December 31, 2015, is $108,145 and $116,218, respectively, compared to a carrying value net of finance charges of $120,644 and $118,031, respectively.

2.	Significant accounting policies:

A discussion of the Company's significant accounting policies can be found in the Company's consolidated financial statements included in the Annual Report on Form 20-F for the year ended December 31, 2015. There have been no material changes to these policies in the six-month period ended June 30, 2016.

Debt issuance costs. In April 2015, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2015-03, "Simplifying the Presentation of Debt Issuance Costs," ("ASU 2015-03"), which is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015. ASU 2015-03 requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. The amortization of such costs will continue to be reported as interest expense. Accordingly, the Company has adopted this accounting standard and reclassified the prior-period amounts to conform to the current-period presentation.

The retrospective effect of our adoption of ASU 2015-03, which affected only the presentation of deferred debt issuance costs in our Consolidated Balance Sheets at December 31, 2015, is as follows:

	Deferred charges, net			Long-term Debt
	(In thousands)
Amount as previously presented, before adoption of ASU 2015-03	$	31,652		$	440,765
Deferred debt issuance costs		(6,645	)		(6,645	)

Amount as restated, after adoption of ASU 2015-03	$	25,007		$	434,120

AEGEAN MARINE PETROLEUM NETWORK INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (Continued)

(Expressed in thousands of U.S. dollars –

except share and per share data, unless otherwise stated)

3.	Trade accounts receivables factoring agreement

In connection with the factoring agreement, renewed on November 13, 2015 and valid until November 14, 2016, the Company sold $67,897 and $91,714 of trade accounts receivable during the periods ended June 30, 2016 and 2015, respectively, net of servicing fees of $320 and $345, included in the condensed consolidated statements of income.

4.	Inventories:

The amounts shown in the accompanying condensed consolidated balance sheets are analyzed as follows:

	June 30, 2016		December 31, 2015
Held for sale:
Marine Fuel Oil	$	127,317	$	82,076
Marine Gas Oil		38,789		30,529
		166,106		112,605
Held for consumption:
Marine fuel		1,320		1,124
Lubricants		588		569
Stores		6		14
Victuals		150		219
		2,064		1,926
Total	$	168,170	$	114,531

AEGEAN MARINE PETROLEUM NETWORK INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (Continued)

(Expressed in thousands of U.S. dollars –

except share and per share data, unless otherwise stated)

Vessels:

During the six months ended June 30, 2016, the movement of the account vessels was as follows:

	Vessel Cost			Accumulated Depreciation			Net Book Value
Balance, December 31, 2015	$	480,346			(109,328	)	$	371,018
- Vessels acquired and delivered		8,667			-			8,667
- Vessels sold		(19,202	)		10,512			(8,690	)
- Depreciation		-			(8,580	)		(8,580	)
- Reclassified to held for sale		(170	)		54			(116	)
Balance, June 30, 2016	$	469,641			(107,342	)	$	362,299

On June 24, 2016, the Company entered into a Memorandum of Agreement to sell PT25, a non-self-propelled bunkering barge, to a third-party purchaser, for a price of $169 (CAD 220,000). The vessel was delivered to its new owners on July 18, 2016. As of June 30, 2016, the vessel was classified as asset held for sale at the lower of its carrying amount and fair value less cost to sell.

On June 24, 2016, the Company completed the sale and delivered the double hull bunkering tanker, Sara, to an unaffiliated third-party purchaser for a price of $2,303, net of commission. The loss on the disposal of $801 was calculated as the net sales price less the carrying value of the asset group, comprising the net book value of the vessel and the unamortized dry-docking costs, of $3,104. This loss is included under the loss on sale of vessels in the condensed consolidated statements of income.

On June 7, 2016, the Company completed the sale and delivered Supporter 2, a bunkering barge previously employed in Ghana, to an unaffiliated third-party purchaser for a price of $110, net of commission. The loss on the disposal of $15 was as the net sales price less the carrying value of the vessel of $125. This loss is included under the loss on sale of vessels in the condensed consolidated statements of income

On May 11, 2016, the Company completed the sale and delivered the double hull bunkering tanker, Aegean Champion, to an unaffiliated third-party purchaser for a price of $5,529, net of commission. The loss on the disposal of $1,621 was calculated as the net sales price less the carrying value of the asset group, comprising the net book value of the vessel and the unamortized dry-docking costs, of $7,150. This loss is included under the loss on sale of vessels in the condensed consolidated statements of income.

On March 23, 2016, the Company took delivery of Umnenga, a 66,895 dwt double hull bunkering tanker built in 1993 to deploy in its service station in South Africa. The vessel was purchased from a third-party seller with a total cost of $8,667.

6.	Other fixed assets:

The amounts in the accompanying condensed consolidated balance sheets are analyzed as follows:

	Land		Buildings			Storage Facility			Other			Total
Cost, December 31, 2015	$	9,036	$	3,459		$	226,910		$	21,583		$	260,988
- Additions		-		-			-			150			150
- Disposals		-		-			-			(160	)		(160	)
Cost, June 30, 2016		9,036		3,459			226,910			21,573			260,978

Accumulated depreciation, December 31, 2015		-		(724	)		(5,591	)		(7,890	)		(14,205	)
- Depreciation expense		-		(63	)		(2,576	)		(1,573	)		(4,212	)
- Disposals		-		-			-			145			145
Accumulated depreciation, June 30, 2016		-		(787	)		(8,167	)		(9,318	)		(18,272	)

Net book value, December 31, 2015		9,036		2,735			221,319			13,693			246,783
Net book value, June 30, 2016	$	9,036	$	2,672		$	218 743		$	12,255		$	242,706

AEGEAN MARINE PETROLEUM NETWORK INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (Continued)

(Expressed in thousands of U.S. dollars –

except share and per share data, unless otherwise stated)

7.	Deferred charges:

During the six months ended June 30, 2016, the movement of the account deferred charges was as follows:

	Dry-docking			Financing Costs			Total
Balance, December 31, 2015	$	20,551		$	4,456		$	25,007
- Additions		2,879			300			3,179
- Disposals		(1,689	)		-			(1,689	)
- Amortization for the period		(3,729	)		(1,746	)		(5,475	)
Balance, June 30, 2016	$	18,012		$	3,010		$	21,022

The amortization for dry-docking costs is included in cost of revenue and in selling and distribution cost in the accompanying condensed consolidated statements of income, according to their function. Deferred financing costs related to revolving credit facilities are presented within deferred charges. The amortization of financing costs is included in interest and finance costs in the accompanying consolidated statements of income.

8.	Goodwill and intangible assets:

Goodwill: Goodwill identified represents the purchase price in excess of the fair value of the identifiable net assets of the acquired business at the date of acquisition. The Company tested its goodwill at December 31, 2015. The Company calculated the fair value of the reporting unit using the discounted cash flow method, and determined that the fair value of the reporting unit exceeded its book value including the goodwill. The discounted cash flows calculation is subject to management judgment related to revenue growth, capacity utilization, the weighted average cost of capital (WACC), of approximately 6%, and the future price of marine fuel products. No impairment loss was recorded at June 30, 2016.

Intangible assets: The Company has identified finite-lived intangible assets associated with concession agreements acquired with the purchase of the Las Palmas and Panama subsidiaries, a non-compete covenant acquired with the Aegean NWE. The values recorded have been recognized at the date of the acquisition and are amortized on a straight line basis over their useful life.

The amounts in the accompanying condensed consolidated balance sheets are analyzed as follows:

		Concession agreements	Non-compete covenant	Total
Cost as of	December 31, 2015	$ 12,025	3,365	$ 15,390
Cost as of	June 30, 2016	12,025	3,365	15,390
Accumulated Amortization as of	December 31, 2015	(3,639)	(2,973)	(6,612)
Accumulated Amortization as of	June 30, 2016	(3,976)	(3,233)	(7,209)
NBV as of	December 31, 2015	8,386	392	8,778
NBV as of	June 30, 2016	8,049	132	8,181
Future Amortization Expense	July 1, to December 31, 2016	341	132	473
Future Amortization Expense	2017	676	-	676
	2018	676	-	676
	2019	676	-	676
	2020	678	-	678
	Thereafter	5,002	-	5,002

AEGEAN MARINE PETROLEUM NETWORK INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (Continued)

(Expressed in thousands of U.S. dollars –

except share and per share data, unless otherwise stated)

9.	Total debt:

The amounts comprising total debt are presented in the accompanying condensed consolidated balance sheet as follows:

Loan Facility	June 30, 2016			December 31, 2015
Short-term borrowings:
Revolving overdraft facility dated 5/6/2015	$	-		$	5,356
Security agreement dated 8/12/2015		87,650			80,000
Borrowing base facility agreement dated 9/16/2015		212,308			164,141
Total short-term borrowings	$	299,958		$	249,497
Long-term debt:
Secured syndicated term loan dated 8/30/2005	$	16,630		$	17,780
Secured term loan facility dated 12/19/2006		10,020			11,420
Secured term loan dated 10/25/2006		15,298			16,043
Secured term loan dated 10/27/2006		9,317			9,929
Secured syndicated term loan dated 10/30/2006		40,804			42,518
Secured term loan dated 9/12/2008		18,991			21,128
Secured syndicated term loan dated 4/24/2008		22,645			23,627
Secured syndicated term loan dated 7/8/2008		-			341
Secured term loan dated 4/1/2010		856			977
Roll over agreement dated 4/1/2010		4,100			4,233
Roll over agreement dated 3/21/2014		3,564			3,786
Senior convertible notes 2013, net of discount		79,238			77,911
Senior convertible notes 2015, net of discount		43,542			42,658
Borrowing base facility agreement dated 9/18/2014		75,000			75,000
Term loan facility agreement dated 10/7/2015		116,817			119,812
Secured term loan dated 3/22/2016		7,654			-
Less: Deferred financing costs		(5,838	)		(6,645	)
Total		458,638			460,518
Less: Current portion of long-term debt		(27,244	)		(26,398	)
Long-term debt, net of current portion and deferred financing costs	$	431,394		$	434,120

The above dates show the later of the date of the facility, the date of the most recent renewal or the date the loan was assumed by the Company.

The amortization of deferred financing costs is included in interest and finance costs in the accompanying condensed consolidated statements of income.

On March 22, 2016, the Company entered into a secured credit facility for an amount of $13,000. The loan bears interest at LIBOR plus a margin.

As at June 30, 2016, the Company was in compliance with all of its financial covenants contained in its credit facilities.

The annual principal payments of long-term debt required to be made after June 30, 2016 are as follows:

	Amount
July 1 to December 31, 2016	$	14,376
2017		108,532
2018		179,581
2019		78,448
2020		41,069
2021 and thereafter		54,240
Total principal payments		476,246
Less: Unamortized portion of notes' discount		(11,770	)
Less: Deferred financing costs		(5,838	)
Total long-term debt	$	458,638

AEGEAN MARINE PETROLEUM NETWORK INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (Continued)

(Expressed in thousands of U.S. dollars –

except share and per share data, unless otherwise stated)

10.	Derivatives and fair value measurements:

The Company uses derivatives in accordance with its overall risk management strategy. The changes in the fair value of these derivatives are recognized immediately through earnings.

The following describes the Company's derivative classifications:

The Company enters into interest rate swap contracts to economically hedge its exposure to variability in its floating rate long-term debt. Under the terms of the interest rate swaps, the Company and the bank agreed to exchange at specified intervals the difference between paying fixed rate and floating rate interest amount calculated by reference to the agreed principal amount and maturity. Interest rate swaps allow the Company to convert long-term borrowings issued at floating rates to equivalent fixed rates.

As of June 30, 2016 and December 31, 2015, the Company was committed to the following interest rate swap arrangements:

	As of June 30, 2016
	Interest Rate Index	Principal Amount	Fair Value/Carrying Amount of Liability	Remaining term	Fixed Interest Rate
U.S. Dollar-denominated Interest Rate Swap	Euribor	$4,100	$511	9.75	2.35%
U.S. Dollar-denominated Interest Rate Swap	Libor	$75,000	$1,583	4.93	1.39%
U.S. Dollar-denominated Interest Rate Swap	Libor	$75,000	$1,410	4.92	1.35%


	As of December 31, 2015
	Interest Rate Index	Principal Amount	Fair Value/ Carrying Amount of Liability	Weighted-average remaining term	Fixed Interest Rate
U.S. Dollar-denominated Interest Rate Swap	Euribor	$4,233	$420	10.25	2.35%

The Company is exposed to credit loss in the event of non-performance by the counterparties to the interest rate swap agreements. In order to minimize counterparty risk, the Company enters into derivative transactions with counterparties that are rated AAA or at least A at the time of the transactions.

The Company enters into foreign currency contracts to hedge its exposure to variability in foreign currency related to the repayment of its long-term debt in foreign currency. Under the terms of the foreign currency contracts, the Company agreed with the bank to exchange currencies at specified exchange rates for the scheduled outflows from the loan repayment. As of June 30, 2016, the Company was committed to 5 year currency arrangements to exchange currencies at agreed rates and for amounts related to the repayment of its foreign currency long-term loan.

The Company uses fuel pricing contracts to hedge exposure to changes in the net cost of marine fuel purchases. The Company has the right of offset with the counterparty of the fuel pricing contracts, and settles outstanding balances on a monthly basis. Therefore, these amounts are presented on a net basis in the condensed consolidated balance sheets (on a gross basis: an asset of $27,362 and a liability of $35,050, as of June 30, 2016 and an asset of $46,949 and a liability of $24,533 as of December 31, 2015).

The following table presents information about our derivative instruments measured at fair value and their locations on the condensed consolidated balance sheets:

		As of
	Balance Sheet Location	June 30, 2016			December 31, 2015
Fuel pricing contracts
Fuel pricing contracts	Derivative asset, current	$	-		$	22,416
Fuel pricing contracts	Derivative liability, current		(7,688	)		-
Currency contracts	Derivative liability, current		(133	)		-
Currency contracts	Derivative liability, non-current		(873	)		-
Interest rate swaps	Derivative liability, non-current		(3,504	)		(420	)
Total, net		$	(12,198	)	$	21,996

AEGEAN MARINE PETROLEUM NETWORK INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (Continued)

(Expressed in thousands of U.S. dollars –

except share and per share data, unless otherwise stated)

The following table presents the effect and financial statement location of our derivative instruments on our condensed consolidated statements of income for the six months ended June 30, 2016 and 2015:

		Six months ended June 30,
Income/ (Loss)	Statements of Income Location	2016			2015

Fuel pricing contracts	Cost of revenue - third parties	$	(39,540	)	$	(6,192	)
Currency contracts	Foreign exchange losses, net		(1,006	)		-
Interest rate swaps	Interest and finance costs		(3,139	)		119
Total		$	(43,685	)	$	(6,073	)

The following table sets forth by level our assets/ liabilities that are measured at fair value on a recurring basis. As required by the fair value guidance, assets/ liabilities are categorized in their entirety based on the lowest level of input that is significant to the fair value measurement.

				Fair value measurements at June 30, 2016
Liabilities	Total			Quoted prices in active markets (Level 1)		Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Interest rate swaps	$	(3,504	)		-	$	(3,504	)		-
Currency contracts		(1,006	)				(1,006	)
Fuel pricing contracts		(7,688	)		-		(7,688	)		-

Total	$	(12,198	)		-	$	(12,198	)		-
				Fair value measurements at December 31, 2015
Assets/ (Liabilities)	Total			Quoted prices in active markets (Level 1)		Significant other observable inputs (Level 2)			Significant unobservable inputs (Level 3)
Interest rate swaps	$	(420	)		-	$	(420	)		-
Fuel pricing contracts		22,416			-		22,416			-

Total	$	21,996			-	$	21,996			-

The fair value of the interest rate swaps is determined using the discounted cash flow method based on market-based EURIBOR or LIBOR rates swap yield curves, taking into account current interest rates. Valuation models require a variety of inputs, including contractual terms, market prices, yield curves, credit spreads, measures of volatility, and correlations of such inputs.

The fair value of the foreign currency contracts is determined based on the agreed fixed and the current exchange currency for the amount agreed to be exchanged on each contract.

The Company uses observable inputs to calculate the mark-to-market valuation of the fuel pricing derivatives. Fuel pricing contracts are valued using quoted market prices of the underlying commodity. During the periods ended June 30, 2016 and 2015, the Company entered into fuel pricing contracts for 14,763,764 metric tons and 8,720,373 metric tons, respectively.

The Company's derivatives trade in over the counter markets, and as such, model inputs are generally observable and do not require significant management judgment. Such instruments are classified within Level 2 of the fair value hierarchy.

AEGEAN MARINE PETROLEUM NETWORK INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (Continued)

(Expressed in thousands of U.S. dollars –

except share and per share data, unless otherwise stated)

11.	Revenues and Cost of revenues:

The amounts in the accompanying condensed consolidated statements of income are analyzed as follows:

	Six Months Ended June 30,
	2016		2015

Sales of marine petroleum products	$	1,702,623	$	2,184,033
Voyage revenues		12,621		14,517
Other revenues		25,244		24,260
Total Revenues		1,740,488		2,222,810

Cost of marine petroleum products		1,541,051		2,040,650
Cost of voyage revenues		7,103		7,561
Cost of other revenues		18,087		15,496
Total Cost of Revenues	$	1,566,241	$	2,063,707

Included in the cost of revenues is depreciation of $2,967 and $2,064 for the six months ended June 30, 2016 and 2015, respectively.

12.	Selling and distribution:

The amounts in the accompanying condensed consolidated statements of income are analyzed as follows:

	Six Months Ended June 30,
	2016		2015

Salaries	$	26,942	$	25,323
Depreciation		7,441		7,336
Vessel hire charges		10,047		14,269
Amortization of dry-docking costs		3,225		2,622
Vessel operating expenses		14,293		13,966
Bunkers consumption		6,097		9,642
Storage costs		22,238		20,135
Broker commissions		2,505		2,854
Provision for doubtful accounts		1,421		1,409
Other		6,506		5,005
Selling and Distribution expenses	$	100,715	$	102,561

13.	General and administrative:

The amounts in the accompanying condensed consolidated statements of income are analyzed as follows:

	Six Months Ended June 30,
	2016		2015

Salaries	$	9,679	$	9,541
Depreciation		1,454		1,349
Office expenses		12,186		10,018
General and Administrative expenses	$	23,319	$	20,908

AEGEAN MARINE PETROLEUM NETWORK INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (Continued)

(Expressed in thousands of U.S. dollars –

except share and per share data, unless otherwise stated)

14.	Commitments and contingencies:

Lease commitments: The Company leases certain property under operating leases, which require the Company to pay maintenance, insurance and other expenses in addition to annual rentals. The minimum annual payments under all non-cancelable operating leases at June 30, 2016 are as follows:

July 1 to December 31, 2016	$	19,453
2017		27,603
2018		25,714
2019		13,757
2020		13,319
Thereafter		139,542
Total minimum annual payments under all noncancelable operating leases	$	239,388

Rent expense under operating leases was $21,421 and $16,806 for the six months period ended June 30, 2016 and 2015, respectively.

Legal Matters:

In November 2005, an unrelated party filed a declaratory action against one of the Company's subsidiaries before the First Instance Court of Piraeus, Greece. The plaintiff asserted that he was instrumental in the negotiation of the Company's eight-year Fuel Purchase Agreement with a government refinery in Jamaica and sought a judicial affirmation of his alleged contractual right to receive a commission of $0.01 per metric ton of marine fuel over the term of the contract. In December 2008, the First Instance Court of Piraeus dismissed the plaintiff's action as vague and inadmissible, however the Company appealed that decision on the grounds that there was no contract between the Company and the plaintiff and that the court lacked jurisdiction. While the action was pending in Greece, the plaintiff commenced a new action involving the same cause of action before the Commercial Court of Paris, France, which dismissed that action in June 2009. The plaintiff's appeal of the dismissal was denied by the Paris Court of Appeal in February 2010. In January 2012, the plaintiff commenced a new action relating to the same allegations before the Commercial Court of Paris, which was dismissed on June 27, 2012 in favor of the competence and jurisdiction of the Greek courts. In July 2012, the plaintiff filed a "contredit," an appeal procedure under French law. In November 2013, the Court held that there is no matter pending in Greece that would allow the French courts to decline jurisdiction to the benefit of the Greek proceedings. As a result, the case is to return to the Commercial Court of Paris which should have to examine the admissibility of Mr. Varouxis' claim in France. The relevant pleadings were issued on December 18, 2015. According to its decision the French Court held that Varouxis is entitled to a part compensation based on a half of its claim fee of $0.01 per metric ton sold but limited to the amount of $670 with respect to the years 2005 to 2008. The Judgement is enforceable subject to the submission by Mr Varouxis to AMP of a bank guarantee as counter-security covering the reimbursement to AMP of the said sum plus interest. Until now Mr. Varouxis has been unable to submit a properly worded bank guarantee. In the meantime, both AMP and Mr. Varouxis have filed contrary appeals versus the decision issued. In any event our position continues to be that this claim is unwarranted and lacking in merit.

On December 18, 2014, the Company and Aegean Bunkering (USA) LLC, or the Aegean Parties, filed a one-count complaint for breach of contract against Hess Corporation, or Hess, in New York Supreme Court, New York County (653887/2014). In the complaint, the Aegean Parties allege that Hess breached certain express representations and warranties in representing its financial condition in an agreement pursuant to which Hess sold its bunker oil business to Aegean Bunkering (USA) LLC. The Aegean Parties claim approximately $28,000 in compensatory damages, exclusive of interest and costs. On February 9, 2015, Hess filed an answer to the complaint. During the course of discovery, through co-counsel Boies Schiller & Flexner LLP, the Aegean Parties filed a motion for leave to amend the complaint on December 15, 2015. The proposed amended complaint added a claim for fraud and fraudulent inducement in connection with the Agreement, seeking approximately $127 million in compensatory damages, exclusive of interest and costs, and punitive damages in an amount to be determined at trial. On Hess's consent, the Aegean Parties' motion to amend the complaint was granted on January 15, 2016. On February 3, 2016, Hess filed a motion to dismiss the amended complaint in part, specifically, the fraud and fraudulent inducement claim and portions of the contract claim. The Aegean Parties' responded to the motion to dismiss on March 4, 2016, and Hess submitted its reply on March 18, 2016. The parties are now awaiting a decision from the Court.

The Company has supplied bunkers through agreements with various entities of the O.W. Bunker Group, which filed for bankruptcy in November 2014. The Company issued notice to members of the O.W. Bunker Group for the request of payment for the value of the bunkers supplied. The Company's exposure for these supplies amounts to $4,951, of which $2,922 is recorded as a provision for doubtful accounts in our consolidated balance sheets. The Company believes that the respective members of the O.W. Bunker Group were never the rightful owners of the bunkers and is currently trying to work out escrow or other practical solutions with the end users. The Company expects to recover the amount of at least $2,029.

A Company's subsidiary, Aegean Oil Terminal Corporation, has provided storage facilities through agreements to Alco Shipping Services LLC and Alco Fuel Trading LLC. In breach of their obligations under their agreements the debtors failed to deliver any products to the terminal and to pay the invoices in the principal sum of $450. Following various demands for payment and in the absence of payment, the Company's subsidiary has terminated their agreement and commenced legal proceedings against the debtors in the High Court of London. After lodging with the court the relevant application, claim for and witness statements the Company's subsidiary received a sealed order from the High Court in London giving permission to service the Claim Form and Particulars of Claim out of the jurisdiction upon the debtors in UAE. The UK Foreign and Commonwealth Office have now returned the service process request with the documents unserved due to the fact that the debtors have moved offices. The debtors do not have a valid defense and once the claim form is served upon them the Company expects to proceed to obtain a summary judgment from the High Court in London. As soon as a judgment is obtained the Company expects to proceed to execute the same by way of arrest and sale of any of the nine ships the debtors own.

Aegean Oil Terminal Corporation has also provided storage facilities through agreements to House of Gas Trading DMCC. In breach of their obligations under their agreements the debtors failed to deliver any products to the terminal and to pay the invoices in the principal sum of $882. Following various demands for payment and in the absence of payment, the Company has terminated their agreement and commenced legal proceedings against the debtors in the High Court of London. After lodging with the court the relevant application, claim for and witness statements the Company's subsidiary received a sealed order from the High Court in London giving permission to service the Claim Form and Particulars of Claim out of the jurisdiction upon the debtors in UAE. The UK Foreign and Commonwealth Office have not yet returned the service process request. The debtors do not have a valid defense and once the claim form is served upon them the Company expects to proceed to obtain a summary judgment from the High Court in London. As soon as a judgment is obtained the Company expects to proceed to execute the same by way of arrest and sale of their assets.

Various claims, suits, and complains, including those involving government regulations and product liability, arise in the ordinary course of business. In addition, losses may arise from disputes with charterers and agents and insurance and other claims with suppliers relating to the operations of the Company's vessels. Currently, management is not aware of any such claims or contingent liabilities for which a provision should be established in the accompanying consolidated financial statements.

Environmental and other liabilities: The Company accrues for the cost of environmental liabilities when management becomes aware that a liability is probable and is able to reasonably estimate the Company's exposure. Currently, management is not aware of any such claims or contingent liabilities for which a provision should be established in these condensed consolidated financial statements. The Company's Protection and Indemnity ("P&I") insurance policies cover third-party liability and other expenses related to injury or death of crew, passengers and other third parties, loss or damage of cargo, claims arising from collisions with other vessels, damage to other third-party property, and pollution arising from oil or other substances. The Company's coverage under the P&I insurance policies, except for pollution, are unlimited. Coverage for pollution is $1,000,000 per vessel per incident.

AEGEAN MARINE PETROLEUM NETWORK INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (Continued)

(Expressed in thousands of U.S. dollars –

except share and per share data, unless otherwise stated)

15.	Equity incentive plan:

The Company measures stock-based compensation cost at grant date, based on the estimated fair value of the award which is determined by the closing price of the Company's common stock traded on the NYSE on the grant date, and recognizes the cost as expense on a straight-line basis (net of estimated forfeitures) over the requisite service period. The expense is recorded in the general and administrative expenses in the accompanying condensed consolidated statements of income. Aegean is incorporated in a non-taxable jurisdiction and accordingly, no deferred tax assets are recognized for these stock-based incentive awards.

All grants of nonvested stock issued under the 2015 Plan are subject to accelerated vesting upon certain circumstances set forth in the 2015 Plan.

The following table summarizes the status of the Company's non-vested shares outstanding for the six months ended June 30, 2016:

	Non-vested Stock			Weighted Average Grant Date Market Price
January 1, 2016		1,965,983		$	11.05
Granted		1,313,000			6.60
Vested		(862,573	)		8.62
Forfeited		(20,000	)		-
June 30, 2016		2,396,410		$	9.19

Total compensation cost of $4,576 was recognized and included in the general and administrative expenses under the accompanying condensed consolidated statements of income for the six months ended June 30, 2016.

As of June 30, 2016, there was $14,640 of total unrecognized compensation cost related to nonvested share-based compensation awards. This unrecognized compensation at June 30, 2016, is expected to be recognized as compensation expense over a weighted average period of 1.8 years as follows:

	Amount
July 1 to December 31, 2016	$	4,914
2017		6,580
2018		2,722
2019		424
	$	14,640

16.	Earnings per common share:

The computation of basic earnings per share is based on the weighted average number of common shares outstanding during the period using the two class method. The computation of diluted earnings per share assumes the granting of non-vested share-based compensation awards (refer to Note 15), 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.

As of June 30, 2016 and 2015, the Company excluded 2,396,410 and 1,768,983 non-vested shares, respectively, as anti-dilutive. Non-vested share-based payment awards that contain rights to receive non forfeitable dividends or dividend equivalents (whether paid or unpaid) and participate equally in undistributed earnings are participating securities, and thus, are included in the two-class method of computing earnings per share.

The treasury stock method is used in calculating diluted earnings per share for the Notes as the Company expects to settle the principal in cash.

The components of the calculation of basic earnings per common share and diluted earnings per common share are as follows:

	Six Months Ended June 30,
	2016			2015

Net income attributable to AMPNI shareholders	$	25,295		$	19,372

Less: Dividends declared and undistributed earnings allocated to unvested shares		(1,103	)		(717	)
Income available to AMPNI common stockholders, basic and diluted	$	24,192		$	18,655

Basic weighted average number of common shares outstanding		47,831,606			47,104,784

Diluted weighted average number of common shares outstanding		47,831,606			47,104,784

Basic earnings per common share	$	0.51		$	0.40
Diluted earnings per common share	$	0.51		$	0.40

AEGEAN MARINE PETROLEUM NETWORK INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED) (Continued)

(Expressed in thousands of U.S. dollars –

except share and per share data, unless otherwise stated)

17.	Income taxes:

The Company operates through its subsidiaries, which are subject to several tax jurisdictions. The income tax expense/ (benefit) for the periods presented and the respective effective tax rates for such periods are as follows:

	Six Months Ended June 30,
	2016			2015
Current tax expense	$	314		$	484
Net deferred tax benefit		(1,959	)		(2,548	)
Income tax benefit	$	(1,645	)	$	(2,064	)
Effective tax rate reconciliation		79.09	%		27.34	%

Our provision for income taxes for each of the six-month periods ended June 30, 2016 and 2015 was calculated for the Company's subsidiaries based in Belgium, Canada, Germany, Russia and the U.S. that are subject to federal and state income taxes.

The reconciliation between the statutory tax expense on income from continuing operations to the income tax expense/ (benefit) recorded in the financial statements is as follows:

	Six Months Ended June 30,
	2016			2015
Income tax benefit on profit before tax at statutory rates	$	(774	)	$	(2,522	)
Effect of permanent differences		(871	)		458
Total tax benefit	$	(1,645	)	$	(2,064	)

Deferred income taxes that derive from our Belgian subsidiaries, are the result of provisions of the tax laws that either require or permit certain items of income or expense to be reported for tax purposes in different periods than they are reported for financial reporting.

18.	Business segments and geographical information:

The Company is primarily a physical supplier in the downstream marine petroleum products industry. Marine petroleum products mainly consist of different classifications of marine fuel oil, marine gas oil and lubricants.

The Company cannot and does not identify expenses, profitability or other financial performance measures by type of marine petroleum product supplied, geographical area served, nature of services performed or on anything other than on a consolidated basis (although the Company is able to segregate revenues on these various bases). As a result, management, including the chief operating decision maker, reviews operating results on a consolidated basis only. Therefore, the Company has determined that it has only one operating segment.

The Company is domiciled in the Marshall Islands but provides no services in that location. It is impracticable to disclose revenues from external customers attributable to individual foreign countries because where the customer is invoiced is not necessarily the country of domicile. In addition, due to the nature of the shipping industry, where services are provided on a worldwide basis, the country of domicile of the customer does not provide useful information regarding the risk that this disclosure is intended to address.

The Company's long-lived assets mainly consist of bunkering tankers which are positioned across the Company's existing territories and which management, including the chief operating decision maker, reviews on a periodic basis and reposition among the Company's existing or new territories to optimize the vessel per geographical territory ratio.

The Company's vessels operate within or outside the territorial waters of each geographical location and, under international law, shipping vessels usually fall under the jurisdiction of the country of the flag they sail. The Company's vessels are not permanently located within particular territorial waters and the Company is free to mobilize all its vessels worldwide at its own discretion.

19.	Subsequent events:

Delivery of vessel: On July 18, 2016, the Company completed the sale and delivered the non-self-propelled bunkering barge, PT25, to an unaffiliated third-party, for a price of $169 (CAD 220,000), resulting in a total gain of approximately $47.