Frontline Plc Roars Ahead in Q1 2025 Despite Market Volatility
In a conference call on May 23, 2025, Frontline Plc's CEO, Lars Barstad, highlighted the company's impressive performance in the first quarter of 2025 despite market volatility and changing policies.
The tanker market has moved along in an orderly manner, with VLCCs taking the lead. According to Barstad, the VLCC fleet achieved $37,200 per day on average, while Suezmax tankers averaged $31,200 per day and LR2/Aframax vessels earned $22,300 per day.
Notably, the company's VLCC days are booked at a higher rate in Q2 2025, with 68% of its VLCC days already secured at $56,400 per day. Similarly, 69% of Suezmax days and 66% of LR2/Aframax days are booked at $44,900 per day and $36,100 per day, respectively.
Frontline Plc reported a profit of $33.3 million or $0.15 per share and adjusted profit of $40.4 million or $0.18 per share in the first quarter of 2025. The company's balance sheet remains solid, with cash and cash equivalents totaling $805 million, including undrawn amounts of revolver capacity, marketable securities, and minimum cash requirements for banks.
As highlighted by Inger Klemp, Frontline Plc's Chief Financial Officer, the company has a substantial cash generation potential with about 30,000 earnings days annually. With current fleet composition and forward rates, the company estimates a potential cash generation of $332 million or $1.49 per share.
The company is optimistic about its prospects, despite market uncertainty. Barstad noted that while there have been paralyzing U.S. policy changes and widening sanctions, these have had limited impact on the energy complex so far. He emphasized that Frontline Plc is well-positioned to navigate this uncertain environment.
