Frontline Plc — Earnings Release 2018

Feb 28, 2019

FRO - Fourth Quarter and Full Year 2018 Results

FRO - Fourth Quarter and Full Year 2018 Results

Frontline Ltd. (the "Company" or "Frontline"), today reported unaudited results

for the three months and year ended December 31, 2018:

Highlights

* Net income attributable to the Company was $25.4 million, or $0.15 per

share, for the fourth quarter of 2018.

* Net income attributable to the Company was $26.3 million, or $0.15 per share

adjusted for certain non-cash items for the fourth quarter of 2018.

* Reported spot average daily time charter equivalent ("TCE") was $28,400 for

VLCCs in the fourth quarter, impacted significantly by a high number of

ballast days towards the end of the quarter, deferring revenue recognition

into the first quarter of 2019.[1] Reported spot TCE for Suezmax tankers and

LR2/Aframax tankers were $26,100 and $18,700, respectively.

* Spot TCE of $41,300 contracted for 84% of vessel days for VLCCs, spot TCE of

$33,300 contracted for 77% of vessel days for Suezmax tankers and spot TCE

of $26,100 contracted for 73% of vessel days for LR2/Aframax tankers,

estimated for the first quarter of 2019, including deferred revenue

recognition from the fourth quarter of 2018.

* In November 2018, the Company extended the terms of its senior unsecured

loan facility of up to $275.0 million with an affiliate of Hemen Holding

Ltd. by 12 months to November 2020.

* In January 2019, the Company increased its ownership interest to 28.9% in

Feen Marine Scrubbers Inc. ("FMSI").

* In January 2019, the Company took delivery of the VLCC newbuilding Front

Defender.

Robert Hvide Macleod, Chief Executive Officer of Frontline Management AS

commented:

"The market improved in the fourth quarter before pulling back due to OPEC cuts,

accelerated fleet growth and seasonal factors. In recent weeks, the market has

reversed course, with US export volumes and VLCC rates doubling since January.

We expect the market to remain volatile but continue to trend higher as the

fleet prepares for new regulations and oil volumes return. Crude oil tanker

demand will also receive a significant boost as refineries increase crude import

runs to meet incremental demand for compliant fuels prior to the implementation

of IMO 2020 regulations. Although there are always risks related to slowing

global demand, multiple positive market drivers should result in strong year

over year growth in earnings."

Inger M. Klemp, Chief Financial Officer of Frontline Management AS added:

"Our current newbuilding program will be completed with the delivery of our last

VLCC newbuilding expected in April 2019.  With limited capital expenditure

requirements going forward and backed by attractive financing, Frontline is

committed to maintaining its healthy balance sheet. This supports our low

breakeven rates and enables the Company to generate significant cash flow in a

strengthening tanker market."

The average daily time charter equivalents ("TCE") earned by Frontline in the

quarter ended December 31, 2018, the prior quarters and in the year ended

December 31, 2017, are shown below, along with spot estimates for the first

quarter of 2019 and the estimated average daily cash break-even ("BE") rates for

the remainder of 2019:

Average daily time charter equivalents ("TCE")

--------------------------------------------------------------------------------

Estimated

average

($ daily

per Spot % cash BE

day) Spot estimates covered rates

+-----+--------------------------------------------------------------+---------+

| | Q1 | |

|  | 2018 Q4 2018 Q3 2018 Q2 2018 2018 2017 Q1 2019 | 2019 |

+-----+--------------------------------------------------------------+---------+

|VLCC |18,300 28,400 19,900 11,700 14,900 22,400 41,300 84% | 24,400 |

| | | |

|SMAX |17,300 26,100 13,500 14,100 15,400 17,300 33,300 77% | 19,900 |

| | | |

|LR2 |14,900 18,700 14,300 11,700 14,800 14,400 26,100 73% | 16,700 |

+-----+--------------------------------------------------------------+---------+

The estimated average daily cash break-even rates are the daily TCE rates the

vessels must earn in order to cover operating expenses including dry docks,

repayments of loans, interen loans, bareboat/tc hire and general and

administrative expenses.

Spot estimates are provided using the load-to-discharge method of accounting as

described in Note 2 to our Unaudited Condensed Consolidated Financial

Statements. The rates quoted are for days currently contracted. The actual rates

to be earned in the first quarter of 2019 will therefore depend on the number of

additional days that we can contract, and more importantly the number of

additional days that each vessel is laden. Therefore a high number of ballast

days at the end of the quarter will limit the amount of additional revenues to

be booked based on accounting under ASC 606.

The load-to-discharge method of accounting results in revenues being recognized

over fewer days, but at a higher rate for those days. Over the life of a voyage

there is no difference in the total revenues and costs to be recognized.

When expressing TCE per day, the Company uses the total available days for the

quarter and not just the number of days the vessel is laden.

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

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 Ltd. 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 "believe," "anticipate," "intend," "estimate," "forecast,"

"project," "plan," "potential," "will," "may," "should," "expect" 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, management's 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,

general market conditions, including fluctuations in charter hire rates and

vessel values, changes in the supply and demand for vessels comparable to ours,

changes in world wide oil production and consumption and storage, changes in the

Company's operating expenses, including bunker prices, dry docking and insurance

costs, the market for the Company's vessels, 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

workers and the related labor costs, compliance with governmental, tax,

environmental and safety regulation, any non-compliance with the U.S. Foreign

Corrupt Practices Act of 1977 (FCPA) 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, the failure of counter

parties to fully perform their contracts with us, our dependence on key

personnel, 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 Bermuda 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, potential liability from

pending or future litigation, general domestic and international political

conditions, potential disruption of shipping routes due to accidents, political

events or acts by terrorists, and other important factors described from time to

time in the reports filed by the Company with the Securities and Exchange

Commission or 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.

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[1] See note 2 to the condensed unaudited financial statements for an

explanation of the impact of the adoption of ASC 606 on the financial statements

for the year ending December 31, 2018.

This information is subject to the disclosure requirements pursuant to section

5 -12 of the Norwegian Securities Trading Act.