Frontline plc (the âCompanyâ, âFrontline,â âwe,â âus,â or âourâ), today reported
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unaudited results for the three and twelve months ended December 31, 2024:
Highlights
- Profit of $66.7 million, or $0.30 per share for the fourth quarter of 2024.
- Adjusted profit of $45.1 million, or $0.20 per share for the fourth quarter
of 2024.
- Declared a cash dividend of $0.20 per share for the fourth quarter of 2024.
- Reported revenues of $425.6 million for the fourth quarter of 2024.
- Achieved average daily spot time charter equivalent earnings (âTCEsâ)(1) for
VLCCs, Suezmax tankers and LR2/Aframax tankers in the fourth quarter of
$35,900, $33,300 and $26,100 per day, respectively.
- Fully drew down a sale-and-leaseback agreement in an amount of $512.1
million to refinance 10 Suezmax tankers, which generated net cash proceeds
of $101.0 million in the fourth quarter of 2024.
- Sold its oldest Suezmax tanker, built in 2010, for a net sales price of
$48.5 million and delivered the vessel to its new owner in October 2024. The
transaction generated net cash proceeds of $36.5 million after repayment of
existing debt and a gain of $17.9 million in the fourth quarter of 2024.
- Repaid the remaining $75.0 million outstanding under the $275.0 million
senior unsecured revolving credit facility with an affiliate of Hemen
Holding Limited, the Companyâs largest shareholder (âHemenâ) in the fourth
quarter of 2024.
- Entered into three senior secured credit facilities for a total amount of up
to $239.0 million to refinance outstanding debt on three VLCCs and one
Suezmax tanker and, in addition, to provide revolving credit capacity in a
total amount of up to $91.9 million.
Lars H. Barstad, Chief Executive Officer of Frontline Management AS, commented:
âThe fourth quarter of 2024 came in unusually soft compared to previous years.
Global oil demand was up marginally as the year came to an end, but global
seaborne exports slowed in the fourth quarter. During the quarter we saw
positive developments in the enforcement of sanctions against Iran and Russia in
particular, but we could not escape the fact that these two countries represent
a material part of the supply to Asia, at cost to demand for the vessels
Frontline operates. For 2025 we have already seen broader sanctions with a wider
scope, at the same time as key importers of exposed crude are diversifying away
from the mentioned suppliers. Compliant fleet growth for the asset classes we
deploy peaked a few years back, making the outlook very constructive as
Frontline sail into the new year with our cost-efficient operations and modern
fleet.â
Inger M. Klemp, Chief Financial Officer of Frontline Management AS, added:
âIn February 2025 we entered into three senior secured credit facilities for a
total amount of up to $239.0 million to refinance three existing term loan
facilities, with total balloon payments of $142.0 million maturing during 2025,
leaving the Company with no debt maturities until the end of 2026 and, in
addition, to provide revolving credit capacity in a total amount of up to $91.9
million. Through these new financings we further strengthen our strong liquidity
and reduce our borrowing costs and cash break even rates. We continue to focus
on maintaining our competitive cost structure, breakeven levels and solid
balance sheet to ensure that we are well positioned to generate significant cash
flow and create value for our shareholders.â
Average daily TCEs and estimated cash breakeven rates
±------------------------------------------------±---------±------±--------+
| | | |Estimated|
| | | | average |
| | | | daily |
| | | | cash |
| | Spot TCE | |breakeven|
|($ per |currently | % |rates for|
| day) Spot TCE |contracted|Covered| 2025 |
±------------------------------------------------±---------±------±--------+
| Q4 Q3 Q2 Q1 | | |
| 2024 2024 2024 2024 2024 2023 | Q1 2025 | 2025 |
| | | |
|VLCC 43,400 35,900 39,600 49,600 48,100 50,300| 43,700 80% | 29,200 |
| | | |
|Suezmax 41,400 33,300 39,900 45,600 45,800 52,600| 35,400 77% | 24,000 |
| | | |
|LR2 / | | |
|Aframax 42,300 26,100 36,000 53,100 54,300 46,800| 29,700 64% | 22,200 |
±------------------------------------------------±-----------------±--------+
We expect the spot TCEs for the full first quarter of 2025 to be lower than the
spot TCEs currently contracted, due to the impact of ballast days during the
first quarter of 2025. See Appendix 1 for further details.
The Board of Directors
Frontline plc
Limassol, Cyprus
February 27, 2025
Ola Lorentzon - Chairman and Director
John Fredriksen - Director
James O'Shaughnessy - Director
Steen Jakobsen - Director
Cato Stonex - Director
Ărjan Svanevik - Director
Dr. Maria Papakokkinou - Director
Questions should be directed to:
Lars H. Barstad: Chief Executive Officer, Frontline Management AS
+47 23 11 40 00
Inger M. Klemp: Chief Financial Officer, Frontline Management AS
+47 23 11 40 00
Forward-Looking Statements
Matters discussed in this report may constitute forward-looking statements. The
Private Securities Litigation Reform Act of 1995 provides safe harbor
protections for forward-looking statements, which 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.
Frontline plc and its subsidiaries, or 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. This report and any other written or oral statements made by
us or on our behalf may include forward-looking statements, which reflect our
current views with respect to future events and financial performance and are
not intended to give any assurance as to future results. When used in this
document, the words âbelieve,â âanticipate,â âintend,â âestimate,â âforecast,â
âproject,â âplan,â âpotential,â âwill,â âmay,â âshould,â âexpectâ and similar
expressions, terms or phrases may identify forward-looking statements.
The forward-looking statements in this report are based upon various
assumptions, including without limitation, managementâs examination of
historical operating trends, data contained in our records and 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. We undertake no obligation to update
any forward-looking statements, whether as a result of new information, future
events or otherwise.
In addition to these important factors and matters discussed elsewhere herein,
important factors that, in our view, could cause actual results to differ
materially from those discussed in the forward-looking statements include:
- the strength of world economies;
- fluctuations in currencies and interest rates, including inflationary
pressures and central bank policies intended to combat overall inflation and
rising interest rates and foreign exchange rates;
- the impact that any discontinuance, modification or other reform or the
establishment of alternative reference rates have on the Companyâs floating
interest rate debt instruments;
- general market conditions, including fluctuations in charter hire rates and
vessel values;
- changes in the supply and demand for vessels comparable to ours and the
number of newbuildings under construction;
- the highly cyclical nature of the industry that we operate in;
- the loss of a large customer or significant business relationship;
- changes in worldwide oil production and consumption and storage;
- changes in the Companyâs operating expenses, including bunker prices, dry
docking, crew costs and insurance costs;
- planned, pending or recent acquisitions, business strategy and expected
capital spending or operating expenses, including dry docking, surveys and
upgrades;
- risks associated with any future vessel construction;
- our expectations regarding the availability of vessel acquisitions and our
ability to complete vessel acquisition transactions as planned;
- our ability to successfully compete for and enter into new time charters or
other employment arrangements for our existing vessels after our current
time charters expire and our ability to earn income in the spot market;
- availability of financing and refinancing, our ability to obtain financing
and comply with the restrictions and other covenants in our financing
arrangements;
- availability of skilled crew members and other employees and the related
labor costs;
- work stoppages or other labor disruptions by our employees or the employees
of other companies in related industries;
- compliance with governmental, tax, environmental and safety regulation, any
non-compliance with U.S. or European Union regulations;
- the impact of increasing scrutiny and changing expectations from investors,
lenders and other market participants with respect to our ESG policies;
- Foreign Corrupt Practices Act of 1977 or other applicable regulations
relating to bribery;
- general economic conditions and conditions in the oil industry;
- effects of new products and new technology in our industry, including the
potential for technological innovation to reduce the value of our vessels
and charter income derived therefrom;
- new environmental regulations and restrictions, whether at a global level
stipulated by the International Maritime Organization, and/or imposed by
regional or national authorities such as the European Union or individual
countries;
- vessel breakdowns and instances of off-hire;
- the impact of an interruption in or failure of our information technology
and communications systems, including the impact of cyber-attacks upon our
ability to operate;
- potential conflicts of interest involving members of our Board of Directors
and senior management;
- the failure of counter parties to fully perform their contracts with us;
- changes in credit risk with respect to our counterparties on contracts;
- our dependence on key personnel and our ability to attract, retain and
motivate key employees;
- adequacy of insurance coverage;
- our ability to obtain indemnities from customers;
- changes in laws, treaties or regulations;
- the volatility of the price of our ordinary shares;
- our incorporation under the laws of Cyprus and the different rights to
relief that may be available compared to other countries, including the
United States;
- changes in governmental rules and regulations or actions taken by regulatory
authorities;
- government requisition of our vessels during a period of war or emergency;
- potential liability from pending or future litigation and potential costs
due to environmental damage and vessel collisions;
- the arrest of our vessels by maritime claimants;
- general domestic and international political conditions or events, including
âtrade warsâ;
- any further changes in U.S. trade policy that could trigger retaliatory
actions by the affected countries;
- potential disruption of shipping routes due to accidents, environmental
factors, political events, public health threats, international hostilities
including the ongoing conflict between Russia and Ukraine, the conflict
between Israel and Hamas and related conflicts in the Middle East, the
Houthi attacks in the Red Sea and the Gulf of Aden, acts by terrorists or
acts of piracy on ocean-going vessels;
- the impact of the U.S. presidential and congressional election results
affecting the economy, future government laws and regulations, trade policy
matters, such as the imposition of tariffs, the amendment, termination or
any other material change to a relationship governed by a treaty and other
import restrictions;
- the length and severity of epidemics and pandemics and their impacts on the
demand for seaborne transportation of crude oil and refined products;
- the impact of port or canal congestion;
- business disruptions due to adverse weather, natural disasters or other
disasters outside our control; and
- other important factors described from time to time in the reports filed by
the Company with the Securities and Exchange Commission.
We caution readers of this report not to place undue reliance on these forward-
looking statements, which speak only as of their dates. These forward-looking
statements are no guarantee of our future performance, and actual results and
future developments may vary materially from those projected in the forward-
looking statements.
This information is subject to the disclosure requirements pursuant to Section
5-12 the Norwegian Securities Trading Act.
(1) This press release describes Time Charter Equivalent earnings and related
per day amounts and spot TCE currently contracted, which are not measures
prepared in accordance with IFRS (ânon-GAAPâ). See Appendix 1 for a full
description of the measures and reconciliation to the nearest IFRS measure.
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