Q2 FY2026
Filed Aug 28, 2026Frontline plc reported its best quarterly profit ever of $659.2 million, or $2.96 per share, and its best adjusted profit ever of $580.2 million, or $2.61 per share, for the second quarter of 2026.
Profit, adjusted profit, revenues, total TCE and spot TCE per day increased from the previous quarter, while the Company declared a $2.61 per share dividend and reduced its weighted average interest rate margin from 178 bps to 126 bps upon completion of the refinancing process in the third quarter of 2026.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Revenuesother | 943,299 (in thousands of $) | – | – |
| Other operating incomeother | 75,380 (in thousands of $) | – | – |
| Total revenues and other operating incomeother | 1,018,679 (in thousands of $) | – | – |
| Voyage expenses and commissionother | 205,895 (in thousands of $) | – | – |
| Ship operating expensesother | 57,449 (in thousands of $) | – | – |
| Administrative expensesother | 12,496 (in thousands of $) | – | – |
| Depreciationother | 71,338 (in thousands of $) | – | – |
| Total operating expensesother | 347,178 (in thousands of $) | – | – |
| Net operating incomeother | 671,501 (in thousands of $) | – | – |
| Finance incomeother | 4,714 (in thousands of $) | – | – |
| Finance expenseother | (35,226) (in thousands of $) | – | – |
| Gain (loss) on marketable securitiesother | (30) (in thousands of $) | – | – |
| Share of results of associated companiesother | 12,389 (in thousands of $) | – | – |
| Dividends receivedother | 6,378 (in thousands of $) | – | – |
| Profit before income taxesother | 659,726 (in thousands of $) | – | – |
| Income tax expenseother | (554) (in thousands of $) | – | – |
| Profit for the periodother | 659,172 (in thousands of $) | – | – |
| Basic and diluted earnings per shareother | $2.96 | – | – |
| Adjusted profitnon-GAAP | 580,210 (in thousands of $) | – | – |
| Adjusted basic and diluted earnings per sharenon-GAAP | 2.61 (in $) | – | – |
| Total TCEnon-GAAP | 753,274 (in thousands of $) | – | – |
| VLCC spot TCE per daynon-GAAP | 152,700 (in $ per day) | – | – |
| Suezmax spot TCE per daynon-GAAP | 111,500 (in $ per day) | – | – |
| LR2 spot TCE per daynon-GAAP | 92,400 (in $ per day) | – | – |
| Net cash provided by operating activitiesother | 579,487 (in thousands of $) | – | – |
| Additions to newbuildings, vessels and equipmentother | (330,825) (in thousands of $) | – | – |
| Proceeds from sale of vesselsother | 138,590 (in thousands of $) | – | – |
| Net cash provided by (used in) investing activitiesother | (192,235) (in thousands of $) | – | – |
| Proceeds from issuance of debtother | 104,812 (in thousands of $) | – | – |
| Repayment of debtother | (296,334) (in thousands of $) | – | – |
| Dividends paidother | (345,065) (in thousands of $) | – | – |
| Net cash used in financing activitiesother | (536,587) (in thousands of $) | – | – |
| Cash and cash equivalentsother | 321,424 (in thousands of $) | – | – |
| Short-term debt and current portion of long-term debtother | 265,911 (in thousands of $) | – | – |
| Long-term debtother | 2,168,931 (in thousands of $) | – | – |
Q3 2026 outlook
- NoteSpot TCE currently contracted: VLCC 156,900 (in $ per day), 86% covered.
- NoteSpot TCE currently contracted: Suezmax 117,400 (in $ per day), 79% covered.
- NoteSpot TCE currently contracted: LR2 / Aframax 81,000 (in $ per day), 70% covered.
- NoteThe Company expects the spot TCEs for the full third quarter of 2026 to be lower than the spot TCEs currently contracted, due to the impact of ballast days during the third quarter of 2026.
Capital returns
- Declared a cash dividend of $2.61 per share for the second quarter of 2026.
- The dividend record date will be September 18, 2026, and dividends are scheduled to be paid on or about September 28, 2026.
- Subject to completion of the sales of two VLCCs, the Company determined to return cash proceeds of approximately $179.0 million through a special one-time dividend of $0.80 per share.
- Dividends paid were (345,065) (in thousands of $) during the second quarter of 2026.
What drove it
- Adjusted profit increased primarily because total TCE increased from $536.5 million in the previous quarter to $753.3 million in the second quarter.
- Spot TCE per day increased from the previous quarter across VLCC, Suezmax and LR2 tanker classes.
- The Company stated that disrupted flows, waiting time, fleet repositioning, increased Atlantic Basin loadings and longer voyages supported tanker utilization and earnings.
- The sale of two Suezmax tankers generated a gain in the second quarter of 2026 of $54.7 million.
- The Company entered into time charter-out agreements for VLCC newbuildings at $120,000 per day per vessel and for two 2016-built VLCCs at average rates of $90,000 and $75,000 per day, respectively.
Concerns
- The Company expects full third-quarter spot TCEs to be lower than currently contracted spot TCEs because of ballast days.
- The tanker market was described as volatile, with rapidly changing risk levels across the Strait of Hormuz, the Red Sea and the Black Sea.
- The overall tanker order book for Frontline's asset classes is 25.4% of the existing global fleet.
- The remaining acquisition of three newbuildings remains subject to certain closing conditions.
What to watch
- Additional third-quarter spot fixtures and the effect of contracted ballast days on realized spot TCE.
- Completion of the two VLCC sales, including the expected third-quarter gain of approximately $110.0 million and the proposed special one-time dividend of $0.80 per share.
- Delivery of the remaining three VLCC newbuildings, expected as two vessels in the fourth quarter of 2026 and one vessel in the first quarter of 2027.
- Execution of the refinancing process and expected drawdowns on the $410.6 million loan facility.
- Tanker trade flows, voyage lengths and fleet productivity amid Middle East, Red Sea and Black Sea disruptions.
Balance sheet and cash flow
- Cash and cash equivalents were 321,424 (in thousands of $) as of June 30, 2026, compared with 251,347 (in thousands of $) as of December 31, 2025.
- Short-term debt and current portion of long-term debt were 265,911 (in thousands of $) as of June 30, 2026, compared with 320,520 (in thousands of $) as of December 31, 2025.
- Long-term debt was 2,168,931 (in thousands of $) as of June 30, 2026, compared with 2,747,225 (in thousands of $) as of December 31, 2025.
- Net cash provided by operating activities was 579,487 (in thousands of $) in the second quarter of 2026.
- Additions to newbuildings, vessels and equipment were (330,825) (in thousands of $) in the second quarter of 2026.
- The remaining commitment under the newbuilding agreements was $601.1 million as of June 30, 2026.
Analysis
Frontline reported record quarterly profitability in the second quarter of 2026. Profit for the period was 659,172 (in thousands of $), compared with 559,120 (in thousands of $) in the previous quarter and 77,543 (in thousands of $) in the prior-year quarter. Adjusted profit was 580,210 (in thousands of $), compared with 344,922 (in thousands of $) in the previous quarter. Revenues were 943,299 (in thousands of $), while total TCE rose to 753,274 (in thousands of $) from 536,549 (in thousands of $) in the preceding quarter.
The earnings improvement was driven by stronger spot-market economics across all reported vessel classes. VLCC spot TCE per day was 152,700 (in $ per day), Suezmax spot TCE per day was 111,500 (in $ per day), and LR2 spot TCE per day was 92,400 (in $ per day), each above the previous-quarter level shown in the filing. Management attributed market support to disruptions and inefficiencies in key shipping routes, relocation of loadings toward the Atlantic Basin, and longer voyage distances. The quarter also included a 54,717 (in thousands of $) gain on sale of vessels, which was excluded from adjusted profit.
Operating expense control remained evident in the reported figures. Total operating expenses were 347,178 (in thousands of $), versus 344,202 (in thousands of $) in the previous quarter, while net operating income rose to 671,501 (in thousands of $). Finance expense was (35,226) (in thousands of $), compared with (40,224) (in thousands of $) in the previous quarter. The Company completed financing amendments and refinancings that it said reduced the weighted average interest rate margin by approximately 52 bps, from 178 bps at the end of the first quarter of 2026 to 126 bps upon completion in the third quarter of 2026.
Cash generation supported both fleet investment and distributions. Net cash provided by operating activities was 579,487 (in thousands of $), while additions to newbuildings, vessels and equipment were (330,825) (in thousands of $). The Company declared a $2.61 per share quarterly dividend and intends, subject to completion of two VLCC sales, to pay a special one-time dividend of $0.80 per share from expected net cash proceeds of approximately $179.0 million. At June 30, 2026, cash and cash equivalents were 321,424 (in thousands of $), short-term debt and current portion of long-term debt were 265,911 (in thousands of $), and long-term debt was 2,168,931 (in thousands of $).
For the third quarter, reported contracted spot TCE was 156,900 (in $ per day) for VLCCs, 117,400 (in $ per day) for Suezmax tankers and 81,000 (in $ per day) for LR2 / Aframax tankers. Coverage was 86%, 79% and 70%, respectively. However, the Company explicitly expects realized full-quarter spot TCEs to be lower than these currently contracted rates due to ballast days. Investors should also focus on the completion of vessel sales, pending newbuilding deliveries, and the effect of geopolitical trade-route disruptions and the reported 25.4% tanker order book on future utilization and rates.
Management, verbatim
The second quarter of 2026 continued to be volatile. The entire energy complex is being challenged, creating inefficiencies that support tanker utilization.
Lars H. Barstad, Chief Executive Officer of Frontline Management AS
Frontline continues to capitalize on these markets into the third quarter, with an increased focus on securing revenue visibility at historically high levels.
Lars H. Barstad, Chief Executive Officer of Frontline Management AS
We continue to focus on maintaining our competitive cost structure, breakeven levels and solid balance sheet to ensure that we are well positioned to generate significant cash flow and create value for our shareholders.
Inger M. Klemp, Chief Financial Officer of Frontline Management AS
Not in the filing
stated, not guessed- GAAP gross profit and gross margin were not reported.
- Non-GAAP gross margin was not reported.
- Free cash flow was not reported.
- Share repurchases were not reported.
- Reportable segment revenue was not reported.
- Revenue, gross margin, operating expenses and tax-rate financial guidance were not reported.
- Prior-year and prior-quarter comparisons for balance-sheet cash and debt line items were not reported on those line items.
- Percentage changes for reported financial metrics were not reported.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.