FRNT - Second quarter and six months 2014 results - Seite 2

The average daily time charter equivalents ("TCEs") earned in the spot and period market in the six months ended June 30, 2014 by the Company's VLCCs and Suezmax tankers were $31,700 and $20,400, respectively, compared with $20,600 and $12,800, respectively, in the six months ended June 30, 2013. The spot earnings for the Company's VLCC and Suezmax tankers were $31,300 and $20,400, respectively, compared with $16,400 and $12,800, respectively, in the six months ended June 30, 2013. The daily earnings for the Company's MR product tankers were $16,700 in the six months ended June 30, 2014.

The Company estimates average cash breakeven TCE rates for the remainder of 2014 for its VLCCs, Suezmax tankers and MR product tankers of approximately $26,800, $19,000 and $13,900, respectively.

Newbuilding Program

The Company's newbuilding program, excluding newbuildings agreed to be sold and newbuilding contracts with STX Dalian and STX Korea, currently comprises 12 LR2 newbuildings plus two options. As of June 30, 2014 total installments of approximately $75.7 million have been paid for these 12 LR2 newbuilding contracts and the remaining installments to be paid amounted to approximately $468.7 million. We expect delivery of the first LR2 from Longxue shipyard at the end of September 2014. The 25 Capesize newbuildings, which the Company has agreed to sell to Knightsbridge, are recorded as Newbuildings Held for Sale at June 30, 2014.

In 2012 and 2013, the Company cancelled all of its five newbuilding contracts at Jinhaiwan ship yard and has received a total refund to date of $243.9 million, of which $89.8 million has been used to repay debt. Total claims not yet received total $76.2 million.

In May 2014, the Company sent a notice of cancellation to STX (Dalian) Shipbuilding Co Ltd ("STX Dalian") in respect of Hull D-2171 and demanded payment $9.5 million and $1.3 million in respect of installments paid and accrued interest, respectively. The yard has disputed this cancellation and the Company has referred it to arbitration.

In July 2014, the Company sent a notice of cancellation to STX Dalian in respect of Hull D-2172 and demanded payment $9.5 million and $1.4 million in respect of installments paid and accrued interest, respectively. The yard has not given notice that it disputes the cancellation and as a result the Company has not referred the validity of the cancellation to arbitration.