Frontline Plc — Earnings Release 2021

Aug 26, 2021

FRO - Second Quarter and Six Months 2021 Results

FRO - Second Quarter and Six Months 2021 Results

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

for the three and six months ended June 30, 2021:

Highlights

* Net loss of $26.6 million, or $0.13 per basic and diluted share for the

second quarter of 2021.

* Adjusted net loss of $23.2 million, or $0.12 per basic and diluted share for

the second quarter of 2021.

* Reported total operating revenues of $170.0 million for the second quarter

of 2021.

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

quarter of 2021 were $15,000, $11,000 and $10,600 per day, respectively.

* For the third quarter of 2021, we estimate spot TCE on a load-to discharge

basis of $14,000 contracted for 70% of vessel days for VLCCs, $9,800

contracted for 64% of vessel days for Suezmax tankers and $11,800 contracted

for 63% of vessel days for LR2 tankers. We expect the spot TCEs for the full

third quarter of 2021 to be lower than the TCEs currently contracted, due to

the impact of ballast days at the end of the third quarter as well as

current freight rates.

* Entered into an agreement in May 2021 for the acquisition through resale of

six scrubber fitted, latest generation ECO-type VLCC newbuilding contracts

currently under construction at the Hyundai Heavy Industries ("HHI")

shipyard in South Korea. The vessels are scheduled to deliver during 2022

starting in the first quarter.

* Entered into agreement in June 2021 to acquire two scrubber fitted, latest

generation ECO-type VLCCs built in 2019 at the HHI shipyard in South Korea.

The vessels are scheduled to deliver during the fourth quarter of 2021.

* Obtained financing commitments for three senior secured term loan facilities

in August 2021 in a total amount of up to $247.0 million to partially

finance the acquisition of the two VLCCs built in 2019 and two of the six

VLCC newbuilding contracts, which are subject to final documentation.

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

"The tanker markets remained challenging throughout the second quarter of 2021,

even though most energy related commodities and shipping markets saw a firm

upswing in demand and prices. Soft tanker markets did catch up with Frontline

this quarter, but with our modern fleet, cost-efficient and agile operating

model we continued to yield returns above key benchmarks. Oil demand is

recovering firmly in the U.S. and Europe, and with relatively high vaccination

rates, the spread of the Delta variant has had a limited impact on oil demand

recovery in these regions. In Asia however the pace of the recovery is more

clouded as countries again move in to lock-downs. The fundamentals of the tanker

market continue to be encouraging, and even more pronounced now as orderbooks

are being filled with vessels catering for trades other than oil and refined

products. Looking at key market indices for tankers, and the fleet average age

and composition, we believe that we are now in a situation where a significant

portion of the fleet is experiencing negative freight rates. This is not

sustainable. Frontline has faced markets like these before, and we continue to

position ourselves towards what we believe will be a firm recovery as global

markets continues to regain lost ground."

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

"We are very pleased to have secured financing commitments in a total amount of

up to $247.0 million on highly attractive terms to partially finance four of our

newly acquired VLCCs. Through this financing we extend our bank group, reduce

our borrowing cost and industry leading cash break even rates and maximize

potential cash flow per share after debt service costs."

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

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

Estimated

average

daily cash

BE rates

for the

($ per Spot TCE remainder

day) Spot TCE estimates % Covered of the year

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

|  2021 Q2 2021 Q1 2021 Q4 2020 2020 Q3 2021 | 2021 |

| | |

|VLCC 17,100 15,000 19,000 17,200 54,500 14,000 70% | 21,800 |

| | |

|SMAX 13,100 11,000 15,200 9,800 35,600   9,800 64% | 17,500 |

| | |

|LR2 11,200 10,600 12,000 12,500 23,400 11,800 63% | 15,400 |

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

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

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 contracted days

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

The actual rates to be earned in the third quarter of 2021 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 we are 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 end of the period, whereas if a vessel is contracted, then certain

costs can be deferred and recognized over the load-to-discharge period.

The recognition 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 as compared to a discharge-to-discharge basis.

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

off hire days and not just the number of days the vessel is laden.

The Board of Directors

Frontline Ltd.

Hamilton, Bermuda

August 25, 2021

Ola Lorentzon - Chairman and Director

John Fredriksen - Director

Tor Svelland - Director

James O'Shaughnessy - Director

Questions should be directed to:

Lars H. Barstad: 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 worldwide 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.