Frontline has made a clear dividend statement in the third quarter, during which it saw its adjusted earnings per share beat the market’s consensus.
The John Fredriksen-controlled company announced a cash dividend of $0.10 per share against adjusted earnings per share of $0.11.
Its net income excluding certain non-cash charges was $5.5m, versus $61.9m in the corresponding quarter of 2015.
Frontline also reported operating quarterly revenue of $157.2m, compared to $107.5m a year earlier.
Robert Hvide Macleod, chief executive of Frontline Management, said: “While the summer is typically a slower period in the tanker markets, seasonal weakness was more pronounced this year as supply disruptions, easing refinery margins and inventory drawdowns led to reduced oil flows and a slowdown in tanker demand.
“In addition, the global fleet expanded as newbuilding vessels were delivered from shipyards.
“We believe that our performance in the third quarter against this market backdrop further highlights Frontline’s competitive position in the market and efficient operations.”
At the same time as announcing the dividend, Frontline secured a commitment for a $321.6m loan from China Exim Bank.
With the latest financing agreement, the company is now fully financed in respect of its newbulding programme of 16 vessels.
Eirik Haavaldsen and Oystein Dalby of Pareto Securities said in a note: “With $275m of available unsecured credit from Hemen, Frontline can both maintain its dividend and pursue further acquisition targets.”
The company added that the tanker market will begin to balance but meanwhile, expected market weakness will create opportunities to buy assets at historically low prices.
