HAMILTON, NORWAY -- (MARKET WIRE) -- 11/27/09 --
Highlights
* Frontline reports a net loss attributable to the Company of $5.6
million and a loss per share of $0.07 for the third quarter of
2009.
* Frontline reports net income attributable to the Company of $98.8
million and earnings per share of $1.27 for the nine months ended
September 30, 2009.
* Frontline announces a cash dividend of $0.15 per share for the
third quarter of 2009.
* Frontline continue to outperform the market and the Company's peers
in the third quarter of 2009 with spot earnings for the double hull
VLCCs and Suezmax tankers in the Gemini Suezmax pool of $26,800 per
day and $14,866 per day, respectively.
* Losses related to the five Suezmax tankers chartered in from Eiger
were $14.6 million in the third quarter and $29 million year to
date. Early November 2009, Frontline redelivered two of the vessels
and expects to redeliver two vessels in December 2009 and the
remaining vessel in the first quarter of 2010.
* The Board has progressed with a plan to strengthen Frontline's
resistance in the case the current weak oil demand will continue to
negatively influence tanker earnings.
Third Quarter and Nine Months 2009 Results
The Board of Frontline Ltd. (the "Company" or "Frontline") announces
a net loss attributable to the Company of $5.6 million for the third
quarter of 2009, equivalent to loss per share of $0.07, compared with
net income attributable to the Company of $27.8 million and earnings
per share of $0.36 for the preceding quarter. Net operating income in
the third quarter was $28.2 million, compared with $62.1 million in
the preceding quarter.
The reported loss reflects a weaker spot market. The average daily
time charter equivalents ("TCEs") earned in the spot and period
market in the third quarter by the Company's VLCCs, Suezmax tankers
and Suezmax OBO carriers were $32,100, $15,900 and $42,200,
respectively, compared with $38,400, $26,800, and $42,700,
respectively, in the preceding quarter. The spot earnings for the
Company's double hull VLCCs and Suezmax tankers were $26,800 and
$12,800, respectively, in the third quarter of 2009, compared with
$38,700 and $24,400, respectively, in the preceding quarter. The
Gemini Suezmax pool had spot earnings of $14,866 per day in the third
quarter.
Profit share expense of $4.8 million has been recorded in the third
quarter as a result of the profit sharing agreement with Ship Finance
International Limited ("Ship Finance") compared to $8.0 million in
the preceding quarter. Ship operating expenses increased by $1.8
million compared with the preceding quarter, primarily as a result of
increased dry docking costs as one additional vessel dry docked in
the third quarter compared to the second quarter.
Charterhire expenses decreased by $7.4 million in the third quarter
compared with the preceding quarter due to the weaker spot market,
which has resulted in reduced expenses on floating rate charters and
profit share payments on two vessels.
Interest income was $5.6 million in the third quarter, of which $5.2
million relates to restricted deposits held by subsidiaries reported
in Independent Tankers Corporation Limited ("ITCL"). Interest
expense, net of capitalized interest, was $39.8 million in the third
quarter of which $10.6 million relates to ITCL.
Frontline announces net income attributable to the Company of $98.8
million for the nine months ended September 30, 2009, equivalent to
earnings per share of $1.27. The average daily TCEs earned in the
spot and period market in the nine months ended September 30, 2009 by
the Company's VLCCs, Suezmax tankers and Suezmax OBO carriers were
$40,200, $26,600 and $43,000, respectively, compared with $81,100,
$61,800 and $43,800, respectively, in the nine months ended September
30, 2008. The spot earnings for the Company's double hull VLCCs and
Suezmax tankers were $40,700 and $24,900, respectively, in the nine
months ended September 30, 2009.
As of September 30, 2009, the Company had total cash and cash
equivalents of $584.7 million, which includes $478.9 million of
restricted cash. Restricted cash includes $293.8 million relating to
deposits in ITCL and $184.3 million in Frontline, which is restricted
under the charter agreements with Ship Finance.
In November 2009, the Company has average total cash cost breakeven
rates on a TCE basis for VLCCs and Suezmaxes of approximately $32,900
and $27,100, respectively.
On November 26, 2009, the Board declared a dividend of $0.15 per
share. The record date for the dividend is December 8, 2009, ex
dividend date is December 4, 2009 and the dividend will be paid on or
about December 22, 2009.
The full report is available for download in the link enclosed.
The Board of Directors
Frontline Ltd.
Hamilton, Bermuda
November 26, 2009
Forward Looking Statements
This press release contains forward looking statements. These
statements are based upon various assumptions, many of which are
based, in turn, upon further assumptions, including Frontline
management's examination of historical operating trends. Although
Frontline believes that these assumptions were reasonable when made,
because assumptions are inherently subject to significant
uncertainties and contingencies which are difficult or impossible to
predict and are beyond its control, Frontline cannot give assurance
that it will achieve or accomplish these expectations, beliefs or
intentions.
Important factors that, in the Company's view, could cause actual
results to differ materially from those discussed in this press
release include the strength of world economies and currencies,
general market conditions including fluctuations in charter hire
rates and vessel values, changes in demand in the tanker market as a
result of changes in OPEC's petroleum production levels and world
wide oil consumption and storage, changes in the Company's operating
expenses including bunker prices, dry-docking and insurance costs,
changes in governmental rules and regulations or actions taken by
regulatory authorities, potential liability from pending or future
litigation, general domestic and international political conditions,
potential disruption of shipping routes due to accidents or political
events, and other important factors described from time to time in
the reports filed by the Company with the United States Securities
and Exchange Commission.
This announcement was originally distributed by Hugin. The issuer is
solely responsible for the content of this announcement.
Copyright © Hugin AS 2009. All rights reserved.
Jens Martin Jensen:
Chief Executive Officer
Frontline Management AS
+47 23 11 40 99
Inger M. Klemp:
Chief Financial Officer
Frontline Management AS
+47 23 11 40 76
