FRO - Fourth Quarter and Full Year 2020 Results

Frontline Ltd. (the “Company” or “Frontline”), today reported unaudited results for the three months and year ended  December 31, 2020:

  

Highlights

• Net income of $412.9 million or $2.09 per diluted share and adjusted net income of $421.6 million or $2.13 per diluted share for the year ended December 31, 2020, being the strongest yearly result since 2008
• Net loss of $9.2 million, or $0.05 per diluted share for the fourth quarter of 2020 
• Adjusted net loss of $20.2 million, or $0.10 per diluted share for the fourth quarter of 2020
• Reported total operating revenues of $174.9 million for the fourth quarter of 2020
• Reported spot TCEs for VLCCs, Suezmax tankers and LR2 tankers in the fourth quarter of 2020 were $17,200, $9,800 and $12,500 per day, respectively
• For the first quarter of 2021, we estimate spot TCE on a load-to discharge basis of $22,600 contracted for 78% of vessel days for VLCCs, $17,800 contracted for 68% of vessel days for Suezmax tankers and $12,200 contracted for 65% of vessel days for LR2 tankers. We expect the spot TCEs for the full first quarter of 2021 to be lower than the TCEs currently contracted, due to the impact of ballast days at the end of the first quarter as well as current prevailing freight rates
• Entered into three senior secured term loan facilities in November 2020 in an amount of up to $250.7 million, $100.8 million and $133.7 million, respectively, to refinance two existing term loan facilities maturing in the second quarter of 2021 and to partially finance the LR2 tankers under construction
• In February 2021, the Company extended the terms of its senior unsecured revolving credit facility of up to $275.0 million with an affiliate of Hemen Holding Ltd. by 12 months to May 2022

Lars H. Barstad, Interim Chief Executive Officer of Frontline Management AS commented:

“In 2020 Frontline recorded its strongest result since 2008, but the fourth quarter of the year reflect the challenging conditions tanker markets experience, as record volume of oil inventories are drawn. Global oil demand is growing firmly, and all leading commodity markets are pointing towards a strong recovery for the world economy in 2021. Demand for tankers is currently muted as the total volume of oil transported is capped. There are indications we may be near the end of the inventory draw cycle as OECD stock levels are approaching 5-year averages. The strong development in oil prices implies real demand returning, most notably in Asia where we are close to pre COVID-19 levels. When global oil markets switch from drawing on inventories, to call on equal volumes from the marketplace, growing demand for freight should be expected. At this point in the curve, we believe Frontline is well positioned to capture a recovery for tankers with our low cash breakeven levels and a spot exposed fleet of modern fuel-efficient vessels.”