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Frontline 2012 records reduced first half profit

Frontline 2012 records reduced first half profit
Tanker owner Frontline 2012, in the midst of merging with Frontline, has reported reduced earnings in the first half, dragged down by losses incurred from discontinued operations.

Net profit in the first six months ended 30 June 2015 was recorded at $61.68m, down 59.2% from $151.11m in the same period of 2014.

The company announced that its net loss from discontinued operations of $73.22m in the first half stemmed mainly from an impairment loss of $40.6m relating to the company’s shareholding in Golden Ocean. The loss compared to the income of $76.76m from discontinued operations in the year-ago period.

Revenue during the first six months, however, jumped by 73.9% year-on-year to $197.46m due mainly to the gain of $63.74m on cancellation and sale of newbuilding contracts compared to $35.91m in the year-ago period.

As at 30 June 2015, Frontline 2012’s newbuilding programme comsisted of 12 LR2, four VLCCs and options for four further VLCCs and six suezmax tankers, and the remaining commitments for 22 newbuilding contracts, amounting to $1.17bn in the period 2015 to 2017.

Subsequent to 30 June 2015, Frontline exercised options for two LR2 newbuilding contracts and its newbuilding programme currently comprises 24 newbuildings.

Meanwhile, Frontline 2012 is set to merge with Frontline following a merger agreement inked in July, for whichy Frontline 2012 will become wholly-owned by Frontline.

Frontline 2012 was hatched at the end of 2011 as part of a restructuring of Frontline amid the weak tanker shipping market.

TAGS: Tankers