Frontline Ltd. (the "Company" or "Frontline"), today reported unaudited results for the three and six months ended June 30, 2017:
Reports a net loss attributable to the Company of $19.4 million, or $0.11 per share, for the second quarter of 2017, primarily due to $7.8 million in dry docking expenses and a $12.2 million loss on the termination of two charters.
Reports a net loss attributable to the Company adjusted for certain non-cash items of $14.2 million, or $0.08 per share, for the second quarter of 2017.
Reports net income attributable to the Company of $7.6 million, or $0.04 per share, and net income attributable to the Company adjusted for certain non-cash items of $13.6 million, or $0.08 per share, for the six months ended June 30, 2017.
Signed two senior secured term loan facilities of up to $110.5 million provided by ING Bank and $110.5 million provided by Credit Suisse, to partially finance four recent resales and newbuilding contracts.
Terminated three long term charters: for the 1998-built Suezmax tanker Front Brabant and the 2000-built VLCC Front Scilla in the second quarter and the 1997-built Suezmax Front Ardenne in the third quarter ahead of the vessels' scheduled drydockings.
Took delivery of three Suezmax and two LR2/Aframax newbuildings.
Robert Hvide Macleod, Chief Executive Officer of Frontline Management AS commented:
"The market has been decidedly weak since the start of the second quarter of 2017, which is primarily the result of the increase in the size of the global crude oil tanker fleet. While the weak market naturally affects our earnings in the short term, the company's strategy is not altered. We continue to take proactive steps to increase the earnings potential of our fleet through the ongoing renewal of our fleet and by pursuing an opportunistic approach in the resale and newbuilding markets. Over the last several quarters, we have divested older, less economical VLCCs and Suezmax tankers and have remained focused on acquiring high-quality, modern VLCCs at attractive prices, lowering the average age for our fleet from 8.1 years to 5.7 years.
The upcoming quarters may present challenges as vessel supply continues to increase, but we are confident in our ability to continue to execute our strategy with the goal of returning value to shareholders. Given how both the ship values and spot market conditions have developed over the summer, we believe we are better positioned having not done any substantial acquisitions in the first half of the year. We expect attractive opportunities to emerge as a result of the weak market and will remain opportunistic going forward. "
Inger M. Klemp, Chief Financial Officer of Frontline Management AS, added:
"The financing of our current newbuilding program is complete, following the signing of our senior secured loan facilities with ING and Credit Suisse. The terms of the financing support Frontline's low cash break-even levels. We are pleased that we continue to be able to access financing on attractive terms, and we believe this is directly related to the financial strength of our platform as well as our strong relationships within the lending community."
The average daily time charter equivalents ("TCE") earned by Frontline in the quarter ended June 30, 2017, the prior quarter and 2016 are shown below, along with guidance for the third quarter in 2017 and the estimated average daily break-even ("BE") rates for the remainder of 2017:
($ per day)
Spot and time charter
Spot and time charter estimates
Estimated average BE rates
The full report can be found in the link below.
Questions should be directed to:
Robert Hvide Macleod: Chief Executive Officer, Frontline Management AS
+47 23 11 40 84
Inger M. Klemp: Chief Financial Officer, Frontline Management AS
+47 23 11 40 76
Matters discussed in this press release may constitute forward-looking statements. 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. Words, such as, but not limited to "believe," "anticipate," "intends," "estimate," "forecast," "project," "plan," "potential," "may," "should," "expect," "pending" 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. Although Frontline believes 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 the control of Frontline, Frontline cannot assure you that they will achieve or accomplish these expectations, beliefs or projections. The information set forth herein speaks only as of the date hereof, and Frontline disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this communication.
This information is subject to the disclosure requirements pursuant to section 5 -12 of the Norwegian Securities Trading Act.