FRO - Frontline Ltd. reports results for the fourth quarter and year ended December 31, 2016
Press release from Frontline Ltd. 28.02.2017
Frontline Ltd. (the "Company" or "Frontline"), today reported unaudited results for the three months and year ended December 31, 2016:
Achieved net income attributable to the Company of $18.3 million, or $0.12 per share, for the fourth quarter of 2016 and $117.0 million, or $0.75 per share, for the year ended December 31, 2016.
Achieved net income attributable to the Company adjusted for certain non-cash items of $34.5 million, or $0.22 per share, for the fourth quarter of 2016 and $188.9 million, or $1.20 per share, for the year ended December 31, 2016.
Announces a cash dividend of $0.15 per share for the fourth quarter of 2016.
Completed a public offering generating gross proceeds of $100.0 million in December 2016.
Frontline, together with its affiliates, acquired approximately 16.4% of the outstanding common stock in DHT Holdings, Inc. (NYSE: DHT).
In January, Frontline approached DHT with a proposal for a possible business combination whereby the Company would acquire DHT in a stock-for-stock transaction, which was declined by DHT's Board.
In February, Frontline presented an improved and final offer of 0.80 Frontline shares per DHT share, which was declined by DHT's Board.
Agreed with Ship Finance to terminate the long term charter for the 1998 built VLCC Front Century upon the sale and delivery of the vessel to a third party.
Acquired two VLCC resales delivering Sep and Oct 2017 from DSME, Korea at $77.5 million net per vessel
Robert Hvide Macleod, Chief Executive Officer of Frontline Management AS commented:
"The improvement in crude tanker rates in the fourth quarter was attributable to seasonality as we approached winter in the Northern Hemisphere as well as a strong increase in OPEC volumes ahead of the implementation of production cuts. We remain of the opinion that 2017 will see pressure on freight rates as further newbuildings are delivered. As DHT's largest shareholder we are surprised that DHT's Board has declined our repeated attempts to discuss a business combination that we believe is clearly in the best interest of all shareholders. We continuously evaluate various ways to expand our fleet and are pleased to have acquired two VLCC resales at historically low prices without adding to the size of the global fleet. We continue to maintain our leading position in the tanker market, supported by our very low cash breakeven rates, large commercial scale and consistent access to capital. These are clear differentiators that the market has consistently ascribed value to."
Inger M. Klemp, Chief Financial Officer of Frontline Management AS, added:
"Frontline's newbuilding program as of December 31, 2016 is fully financed. The Company has already initiated dialogues with banks to finance our two newly acquired resale VLCCs and are confident that we will be able to secure financing at attractive terms."
The average daily time charter equivalents ("TCE") earned by Frontline in the fourth quarter and year ended December 31, 2016 are shown below:
($ per day)
Spot and time charter
Estimated average daily BE rates
Questions should be directed to:
Robert Hvide Macleod: Chief Executive Officer, Frontline Management AS
+47 23 11 40 84
Inger M. Klemp: Chief Financial Officer, Frontline Management AS
+47 23 11 40 76
Matters discussed in this press release may constitute forward-looking statements. Forward-looking statements 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. Words, such as, but not limited to "believe," "anticipate," "intends," "estimate," "forecast," "project," "plan," "potential," "may," "should," "expect," "pending" and similar expressions identify forward-looking statements. The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although Frontline believes 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 the control of Frontline, Frontline cannot assure you that they will achieve or accomplish these expectations, beliefs or projections. The information set forth herein speaks only as of the date hereof, and Frontline disclaims any intention or obligation to update any forward-looking statements as a result of developments occurring after the date of this communication.
This information is subject to the disclosure requirements pursuant to section 5 -12 of the Norwegian Securities Trading Act.