Frontline Registers 30% Revenue Decline In Q3

Frontline Ltd FRO reported third-quarter operating revenue of $171.8 million, a decline of 30.6% year-over-year. Adjusted net loss was $(35.9) million, or $(0.18) per share. Total operating expenses increased 9.3% Y/Y to $191.34 million.

• The company recorded an operating loss of $(19.34) million, compared to an income of $70.96 million a year ago.
• Frontline cash used in operating activities was $3.5 million, compared to cash provided $132.09 million a year ago.
• Reported spot TCEs for VLCCs, Suezmax tankers, and LR2 tankers in the quarter were $10,500, $7,900, and $10,700 per day, respectively.
• In November 2021, Frontline entered an agreement to sell four of its scrubber-fitted LR2 tankers built in 2014 and 2015 for an aggregate sale price of $160.0 million.
• Frontline also extended the terms of its senior unsecured revolving credit facility of up to $275 million by 12 months to May 2023.
• As of September 30, 2021, the company's fleet consisted of 69 vessels, with an aggregate capacity of~12.2 million DWT.
• "During the third quarter of the year, we finally started to see ship recycling accelerate. The fundamentals of this market remain the same; the global tanker fleet is aging rapidly, orderbooks are dwindling as global oil demand is about to grow beyond a hundred million barrels per day. These factors combine to create a potentially potent cocktail for the recovery of the tanker market," commented Lars H. Barstad, CEO of Frontline Management AS.
• For Q4, the company estimates spot TCE on a load-to discharge basis of $21,600 contract for 79% of vessel days for VLCCs, $17,900 contracted for 72% of vessel days for Suezmax tankers, and $16,000 contracted for 64% of vessel days for LR2 tankers.
• Price Action: FRO shares are trading lower by 0.74% at $6.77 during the pre-market session on Monday.