Frontline Ltd. (NYSE:FRO) Q3 2022 Results Conference Call November 30, 2022 9:00 AM ET

Company Participants

Lars Barstad - CEO

Inger Klemp - CFO

Conference Call Participants

Omar Nokta - Jefferies

Chris Robertson - Deutsche Bank

Greg Lewis - BTIG

Operator

Good day. And thank you for standing by. Welcome to the Q3 2022 Frontline Limited Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers’ presentation, there'll be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to turn the conference over to your speaker today, CEO, Mr. Lars Barstad. Please go ahead.

Lars Barstad

Thank you very much. Good morning and good afternoon to you all. Welcome to Frontline's third quarter earnings call.

It's quite gratifying to be able to report from a corner of the market that sees the spectacular earnings these days. I have jokingly referred to tankers as a safe haven during market turmoil. Well, it's proven true the last six months.

In the third quarter, we saw all the asset classes, Frontline trades, starting to perform. I say starting, as there has been some water under the bridge since end September. There are three key headlines I'll talk more about later in this presentation: crude and product displacement due to the sanctions on Russia; Chinese imports starting to recoup lost terrain from COVID-19 lockdowns; and the U.S. export situation.

Before we get to the third quarter financials and what lies ahead, let's have a look at the highlights on slide 3 in the deck.

In the third quarter, Frontline achieved $25,000 per day on our VLCC fleet; $41,100 per day on our Suezmax fleet; and $40,200 per day on our LR2/Aframax fleet. So far, in the first quarter of 2020 -- sorry, in the third quarter of 2022, we have booked 75% of our VLCC days at the solid $77,200 per day; 76% of our Suezmax days at $65,400 per day; and 70% of our LR2/Aframax days at a cool $58,000 per day. And again, all numbers in this table are on the load to discharge basis and will be affected by the amount of ballast we end up having at the end of the quarter. But it does hint to an okay Q4, regardless.

If we quickly jump to slide 4 in the deck, I'll repeat a few key points on the Frontline fleet composition. We -- and I just want to remind kind of all the listeners that we continue to have one of the youngest and most energy efficient [Technical Difficulty] industry. We have received a few newbuildings during the year, and there are two more to come in January on the VLCC side. Post delivery and post installment of scrubbers in Q4 and Q1, we’ll have 21 of our 23 VLCCs will be fitted with scrubber; on the Suezmax side, 21 of our 29 Suezmaxes are fitted with scrubbers; and on the LR2s, 4 out of 18.