Frontline Ltd (FRO)

[Dr Blunt]

$FRO Results of Operation

Time charter revenues increased by $116.4 million in the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019 primarily due to the income recognized from the five vessels chartered out to Trafigura after the closing of the Acquisition and the net delivery of four vessels to time charters with increased rates.

Voyage charter revenues increased by $317.7 million in the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019 primarily due to the increase in market freight rates, as well as the delivery of five vessels acquired from Trafigura and two new buildings onto voyage charters. These factors were partially offset by the net increase in vessels trading under time charters and the termination of the lease on one vessel chartered-in from SFL.

The finance lease interest income relates to the investment in a finance lease for one VLCC, which has decreased as the underlying lease receivable was fully amortized.

Other income primarily comprises the income earned from the commercial management of related party and third party vessels and newbuilding supervision fees derived from related parties. The decrease in the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019 was due to a decrease in newbuilding supervision fees earned.

Voyage expenses and commissions decreased by $2.8 million in the nine months ended September 30, 2020 as compared to the nine months ended September 30, 2019 primarily due to the delivery of vessels onto time charters, the termination of the lease for one VLCC chartered-in from SFL and a decrease in bunker costs due to reduced prices. This was partially offset by an increase in expenses due to the charter-in and subsequent acquisition of 10 Suezmax tankers from Trafigura, the delivery of four newbuildings between January 2019 and September 2020, and an increase in commissions due to increased market rates.