Frontline plc (NYSE:FRO) reported second-quarter 2026 results on Friday, with stronger tanker rates supporting a sharp improvement in profitability.
Shares traded higher following the results as investors reacted to the EPS and revenue beats, record profitability and stronger tanker-rate performance.
Adjusted EPS of $2.61 beat the $2.60 estimate, while revenue of $943.299 million beat the $760.638 million estimate and rose 96.5% year over year.
GAAP EPS increased to $2.96 from 35 cents a year earlier. Quarterly profit reached a record $659.2 million, compared with $77.5 million, while adjusted profit rose to a record $580.2 million from $80.4 million.
TCE Earnings And Fleet Activity
Total time charter equivalent, or TCE, earnings rose to $753.3 million from $283 million a year earlier.
Average daily spot TCE rates reached $152,700 for VLCCs, $111,500 for Suezmax tankers and $92,400 for LR2/Aframax vessels.
Frontline sold its two oldest Suezmax tankers, generating about $106 million in net cash proceeds and a $54.7 million gain.
Frontline also secured one-year charters for two VLCC newbuildings at $120,000 per day. Two 2016-built VLCCs entered into two- and three-year charters at average rates of $90,000 and $75,000 per day, respectively.
Cash Flow And Refinancing
Operating cash flow reached $579.5 million. Frontline ended June with $321.4 million in cash, $265.9 million in short-term and current long-term debt, and $2.17 billion in long-term debt.
The company also lowered its weighted average interest-rate margin by 52 basis points, from 178 bps at the end of the first quarter to 126 bps following the refinancing process.
Dividends And Q3 Rates
The board declared a quarterly dividend of $2.61 per share. Frontline also plans a special 80-cent dividend, subject to completing two VLCC sales expected to generate about $179 million in net cash proceeds.
For the third quarter, contracted spot TCE rates are $156,900 for VLCCs, $117,400 for Suezmaxes and $81,000 for LR2/Aframaxes, with coverage of 86%, 79% and 70%, respectively.
Frontline expects full-quarter rates to come in below currently contracted levels due to ballast days.
Tanker Market Outlook
Management said Middle East disruptions, longer trade routes, and inventory replenishment could support tanker demand.
Management noted increased geopolitical risks, including in the Gulf of Oman and Black Sea, affecting tanker inefficiencies.
It also flagged tariffs, trade restrictions and geopolitical volatility as risks to trade flows, vessel utilization and operating costs.
FRO Price Action: Frontline shares were up 0.50% at $43.97 at the time of publication on Friday. The stock is trading near its 52-week high of $45.17, according to Benzinga Pro data.
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