Frontline Plc — Earnings Release 2020

Nov 25, 2020

FRO - Third Quarter and Nine Months 2020 Results

FRO - Third Quarter and Nine Months 2020 Results

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

for the three and nine months ended September 30, 2020:

Highlights

* Net income of $57.1 million, or $0.29 per diluted share for the third

quarter of 2020

* Adjusted net income of $56.4 million, or $0.29 per diluted share for the

third quarter of 2020

* Reported total operating revenues of $247.4 million for the third quarter of

2020

* Reported spot TCEs for VLCCs, Suezmax tankers and LR2 tankers in the third

quarter of 2020 were $49,200, $25,100 and $12,800 per day, respectively

* For the fourth quarter of 2020, we estimate spot TCE on a load-to discharge

basis of $22,600 contracted for 74% of vessel days for VLCCs, $12,600

contracted for 61% of vessel days for Suezmax tankers and $13,800 contracted

for 65% of vessel days for LR2 tankers. We expect the spot TCEs for the full

fourth quarter of 2020 to be lower than the TCEs currently contracted, due

to the impact of ballast days at the end of the fourth quarter as well as

current freight rates

* Entered into three senior secured term loan facilities in November 2020 in

an amount of up to $250.7 million, $100.8 million and $133.7 million,

respectively, to refinance two existing term loan facilities maturing in the

second quarter of 2021 and to partially finance the LR2 tankers under

construction

* Divested our 71.38% ownership interest in ship management company SeaTeam

Management Pte Ltd.

Lars H. Barstad, Interim Chief Executive Officer of Frontline Management AS

commented:

"Frontline's strong results in the third quarter of 2020 came amid an extremely

volatile quarter for the industry. Oil demand slowly began to recover in the

third quarter of 2020, and the record levels of global oil inventories have been

gradually declining. While demand remains significantly lower than prior to the

pandemic, it is forecast to rebound in 2021. Demand growth coupled with the

potential for OPEC+ production cuts to be reversed would quickly boost tanker

demand. There continues to be uncertainty about the impact of newly-mandated

lockdowns, particularly in the western hemisphere, as well as the timing of the

potential reversal of OPEC+ production cuts. In the longer term, the tanker

fleet fundamentals remain favorable with the lowest orderbook in 20 years across

all asset classes. Frontline is very confident in the long-term prospects due to

its modern fuel-efficient fleet, cost efficient organization and robust

financial position, and we expect to deliver increasingly strong performance as

the global recovery continues."

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

"Following the recently concluded refinancing of two term loan facilities with

total balloon payments of $324.4 million due in April 2021 and in June 2021,

Frontline has no material maturities until 2023. The Company's newbuilding

program is also fully funded with a new term loan facility in an amount of up to

$133.7 million.  Importantly, our recent financings were done at attractive

terms, maintaining our competitive cost structure and reinforcing Frontline's

strong standing within the lending community."

Average daily time charter equivalents ("TCEs")(1)

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

Estimated

average

($ per Spot TCE daily BE

day) Spot TCE estimates % covered rates

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

|  Q3 2020 Q2 2020 Q1 2020 Q4 2019 2019 Q4 2020 | Q4 2020 |

| | |

|VLCC 49,200 75,800 74,800 58,000 35,900 22,600 74% | 21,900 |

| | |

|SMAX 25,100 51,100 57,800 38,200 25,800 12,600 61% | 20,400 |

| | |

|LR2 12,800 36,900 31,200 29,800 22,000 13,800 65% | 15,700 |

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

The estimated average daily cash breakeven rates are the daily TCE rates the

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

repayments of loans, interest on loans, bareboat hire, time charter hire and net

general and administrative expenses for the remainder of the year.

Spot estimates are provided on a load-to-discharge basis, whereby the company

recognizes revenues over time ratably from commencement of cargo loading until

completion of discharge of cargo. The rates reported are for all days up until

the last contracted discharge of cargo for each vessel in the quarter. The

actual rates to be earned in the fourth quarter of 2020 will 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 on a load-to-discharge basis. Ballast days are days when a

vessel is sailing without cargo and therefore unable to recognize revenues.

Furthermore, when a vessel remains uncontracted at the end of the quarter, the

Company will recognize certain costs during the uncontracted days up until the

period end, whereas if a vessel is contracted, then certain costs can be

deferred and recognized over the load-to-discharge period.

The reporting of revenues on a load-to-discharge basis 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 for the third quarter of 2020, the Company uses the

total available days for the quarter and not just the number of days the vessel

is laden.

The Board of Directors

Frontline Ltd.

Hamilton, Bermuda

November 24, 2020

Questions should be directed to:

Lars H. Barstad: Interim Chief Executive Officer, Frontline Management AS

+47 23 11 40 37

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.

This information is subject to the disclosure requirements pursuant to Section

5-12 the Norwegian Securities Trading Act

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(1) This press release describes Time Charter Equivalent earnings and related

per day amounts, which are not measures prepared in accordance with US GAAP

("non-GAAP"). See Appendix 1 for a full description of the measures and

reconciliation to the nearest GAAP measure.