Frontline Q2 Earnings Call Highlights

Frontline NYSE: FRO reported its highest quarterly profit and adjusted profit on record for the second quarter of 2026, supported by sharply higher tanker rates and market inefficiencies that management said have tightened effective vessel supply.

The company posted net income of $659.2 million, or $2.96 per share, while adjusted profit totaled $580.2 million, or $2.61 per share.

Adjusted profit rose $235.3 million from the prior quarter, primarily reflecting higher time-charter equivalent, or TCE, earnings.

“Frontline is reporting its best quarter ever,” Chief Executive Officer Lars Barstad said.

He attributed the results in part to the company’s strategy of expanding voyage days and exposure to the spot market during the weaker period following the COVID-19 pandemic.

Fleet earnings and bookings During the second quarter, Frontline achieved average daily TCE rates of $152,700 for its VLCC fleet, $111,400 for Suezmax tankers and $92,400 for LR2/Aframax tankers.

Barstad said that 86% of VLCC days had been booked at $156,900 per day, while 79% of Suezmax days were booked at $117,400 per day.

The company’s LR2 fleet had booked 70% of days at $81,000 per day.

He noted that the figures were calculated on a load-to-discharge basis, including the effect of ballast days at quarter-end.

Chief Financial Officer Inger Klemp said operating costs, administrative expenses, interest expense and depreciation all declined from the first quarter.

Ship operating expenses fell by $4.3 million, which she attributed largely to vessel sales, increased supplier rebates and partially offsetting higher general running costs.

Administrative expenses declined by $2.4 million, while adjusted interest expense decreased by $4.8 million because of lower debt and lower interest rates.

Liquidity, financing and fleet profile Frontline reported $1.2 billion of liquidity as of June 30, including cash, cash equivalents, undrawn revolver capacity, marketable securities and bank minimum-cash requirements.

The company said it has no meaningful debt maturities until 2030.

Remaining newbuilding commitments stood at $601.1 million at the end of June and relate to nine newbuildings being acquired from an affiliate of CMN.

Frontline has secured up to $737 million in financing for those newbuildings, according to Klemp.

In the second and third quarters, Frontline reduced its weighted-average interest-rate margin by about 52 basis points, to 126 basis points from 178 basis points at the end of the first quarter.

The reduction resulted from amendments to existing facilities, refinancings, newbuilding financing and asset sales, Klemp said.

Following delivery of its remaining VLCC newbuildings and the sale of two VLCCs, Frontline expects its fleet to consist of 40 VLCCs, 19 Suezmax tankers and 18 Aframax/LR2 tanker...