Frontline Plc (FRO) 2021 Q1 法說會逐字稿

Good day and thank you for standing by. Welcome to the Q1 2021 Frontline Earnings Conference Call. (Operator Instructions) I must advise you that this conference is being recorded today on Thursday, the 27th of May, 2021.

美好的一天，感謝您的支持。歡迎參加 2021 年第一季一線獲利電話會議。 （操作員說明）我必須通知您，本次會議將於今天 2021 年 5 月 27 日星期四錄製。

And now without any further delay, I'd like to hand the conference over to your speaker today, Lars Barstad, Interim CEO. Please go ahead.

現在，不再拖延，我想將會議交給今天的發言人、臨時執行長拉爾斯·巴斯塔德 (Lars Barstad)。請繼續。

Thank you very much. Thank you, and good morning and good afternoon to everyone. Welcome to Frontline's First Quarter Earnings Call for 2021. We're obviously quite content to being able to provide black numbers, maybe to the surprise to many of you. Q1 '21 was a fairly quiet quarter corporate-wise as we are in a good position financially and no major transactions were concluded during the quarter.

非常感謝。謝謝大家，大家早安，下午好。歡迎參加 Frontline 的 2021 年第一季財報電話會議。 21 年第一季對於企業來說是一個相當安靜的季度，因為我們的財務狀況良好，並且該季度沒有完成重大交易。

We continue from trying to have a high focus on the well-being of our seafarers as they are out there being exposed to the global ebb and flow of COVID-19 infections. Our technical and operations team are doing a fantastic job in mitigating the challenges that arise. And I'm very happy to report that we are well underway in vaccinating our sailors.

我們繼續努力高度關注海員的福祉，因為他們面臨著全球 COVID-19 感染潮起潮落的影響。我們的技術和營運團隊在緩解出現的挑戰方面做得非常出色。我很高興地向大家報告，我們為水手接種疫苗的工作進展順利。

Let's now move to Slide 3 and have a look at the highlights. The Q1 '21 performance is very much a testament to keeping true to our strategy. Being mostly spot exposed and not expecting an imminent recovery in the market, our chartering desk remain true to trading the ships in a month where we allow our vessels to commit to long voyages, securing income but potentially giving away upside. Our modern fuel-efficient fleet is built for this purpose, and it also gives us this flexibility. This proved to be the right call.

現在讓我們轉到幻燈片 3，看看其中的亮點。 21 年第一季的業績在很大程度上證明了我們堅持我們的策略。由於大部分現貨敞口，並且預計市場不會立即復蘇，我們的租船部門仍然忠實於一個月內的船舶交易，我們允許我們的船舶進行長途航行，確保收入，但可能會放棄上漲空間。我們的現代節能車隊就是為此目的而建造的，它也為我們提供了這種靈活性。事實證明這是正確的決定。

In the first quarter of 2021, we made $19,000 per day on our VLCC fleet; $15,200 per day on our Suezmax fleet; and $12,000 per day on our LR2/Aframax fleet. So far in Q1, we have booked 70% of our VLCC days at $18,100 per day; 63% of our Suezmax days at $13,600 per day; and 59% of our LR2/Aframax days at $14,200 per day. All these numbers in the table are on a load-to-discharge basis.

2021 年第一季度，我們的 VLCC 船隊每天賺取 19,000 美元；我們的 Suezmax 船隊每天 15,200 美元；我們的 LR2/阿芙拉型船隊每天 12,000 美元。到目前為止，第一季度，我們已經以每天 18,100 美元的價格預訂了 70% 的 VLCC； 63% 的蘇伊士型油輪天數為每天 13,600 美元； 59% 的 LR2/Aframax 日費為每天 14,200 美元。表中的所有這些數字均以負載至放電為基礎。

Before Inger takes you through the financial highlights, let me quickly comment on the fleet development as well. We took delivery of 2 of our 4 LR2s coming this year from Fusion and from Future in March and April, respectively, bringing our number of LR2s on the water to 20. Further, subsequently, we confirmed acquisition through resale of 6 high-spec ECO scrubbers-fitted VLCCs to be delivered from Hyundai Heavy Industries in Korea, 5 in 2022 and 1 early in 2023. I'll now let Inger take you through the financial highlights.

在英格向您介紹財務亮點之前，讓我先快速評論一下機隊的發展。今年 3 月和 4 月，我們分別從 Fusion 和 Future 接收了 4 艘 LR2 中的 2 艘，使我們水上的 LR2 數量達到 20 艘。洗滌器的VLCC 將於2022 年交付5 艘，1 艘於2023 年初交付。

Thank you, Lars, and good morning and good afternoon to all of you. And let's then turn to Slide 4 and look at the income statement. As Lars said, we are happy to report numbers in blacks. Frontline achieved total operating revenues, net of voyage expenses, of $107 million in the first quarter. We also had an adjusted EBITDA of $59 million. And we report net income of $28.9 million or $0.15 per share.

謝謝你，拉爾斯，祝大家早安，下午好。然後讓我們轉到投影片 4 並查看損益表。正如拉斯所說，我們很高興報告黑人的數字。 Frontline 第一季扣除航程費用後的總營業收入為 1.07 億美元。我們的調整後 EBITDA 也為 5,900 萬美元。我們報告淨利潤為 2890 萬美元，即每股 0.15 美元。

Further, we have an adjusted net income of $8.8 million or $0.04 per share. The adjustments consist of $15.7 million gain on derivatives, a $3.1 million unrealized gain on marketable securities, a $1.2 million amortization of acquired time charters and a $0.1 million share of results of associated companies. The adjusted net income in the first quarter have increased $21 million compared with the previous quarter. And the increase was driven by a decrease in ship operating expenses of $11 million, mainly as a result of $6.4 million lower dry-docking costs. We also had an increase in time charter equivalent earnings of $6.8 million, and that was due to the higher TCE rates as well as we had a $11.2 million decrease in other costs.

此外，我們的調整後淨利潤為 880 萬美元，即每股 0.04 美元。調整包括 1,570 萬美元的衍生性商品收益、310 萬美元的有價證券未實現收益、120 萬美元的收購期租攤銷以及 10 萬美元的聯營公司業績份額。第一季調整後淨利較上季增加2,100萬美元。這一增長是由於船舶運營費用減少了 1100 萬美元，主要是由於乾塢成本減少了 640 萬美元。我們的定期租船等值收入也增加了 680 萬美元，這是由於 TCE 費率較高，而且其他成本減少了 1,120 萬美元。

Let us then take a look at the balance sheet on Slide 5. The total balance sheet numbers have increased with $10 million in the first quarter. The balance sheet movements in the quarter were primarily related to taking delivery of the LR2 tanker Front Fusion in addition to ordinary debt repayments and depreciation. As of March 31, 2021, Frontline had $380 million in cash and cash equivalents, including undrawn amounts under our senior unsecured loan facility, marketable securities and minimum cash requirements.

然後讓我們來看看投影片 5 上的資產負債表。除了普通債務償還和折舊之外，本季的資產負債表變動主要與 LR2 油輪 Front Fusion 的接收有關。截至 2021 年 3 月 31 日，Frontline 擁有 3.8 億美元的現金和現金等價物，包括我們的優先無擔保貸款安排、有價證券和最低現金要求下的未提取金額。

Let's then take a closer look on Slide 6, on the cash breakeven rates and the OpEx. We estimate average cash cost breakeven rate for the remainder of 2021 of approximately $21,500 per day for VLCC; $17,700 per day for the Suezmax tankers; and $15,900 per day for LR2 tankers. This gave a fleet average estimate of about $18,000 per day. These rates are the all-in day rates that our vessels must earn to cover budgeted operating costs and dry dock, estimated interest expenses, TC and bareboat hire and installments on loans and G&A expenses.

然後讓我們仔細看看幻燈片 6 中的現金損益平衡率和營運支出。我們估計 VLCC 2021 年剩餘時間內的平均現金成本損益平衡率約為每天 21,500 美元；蘇伊士型油輪每天 17,700 美元； LR2 油輪每天 15,900 美元。這使得車隊平均每天的費用約為 18,000 美元。這些費率是我們的船舶必須賺取的全天費率，以支付預算營運成本和乾船塢、估計利息費用、TC 和光船租金以及貸款分期付款和一般管理費用。

In the quarter, we recorded OpEx expenses of $7,300 per day for the VLCCs; $7,100 per day for the Suezmax tankers; and $7,200 per day for the LR2 tankers. We did dry-dock 1 Suezmax tanker in the first quarter only, and we expect to dry-dock 2 Suezmax tankers and 4 LR2 tankers in the second quarter.

本季度，我們記錄了 VLCC 每天的營運支出為 7,300 美元；蘇伊士型油輪每天 7,100 美元； LR2 油輪每天 7,200 美元。我們僅在第一季乾塢了 1 艘 Suezmax 油輪，預計第二季將乾塢 2 艘 Suezmax 油輪和 4 艘 LR2 油輪。

Let's then look at the graph on the right-hand side of the slide. As usual, we show the incremental cash flow after debt service per year and per share, assuming $10,000, $20,000, $30,000 or $40,000 per day achieved rates in excess of our cash breakeven rates. The numbers include vessels on time charter out, are adjusted for newbuilding deliveries. And we're looking at a period of 365 days from April 1, 2021.

然後讓我們看一下投影片右側的圖表。像往常一樣，我們顯示每年和每股償債後的增量現金流，假設每天 10,000 美元、20,000 美元、30,000 美元或 40,000 美元的實現率超過我們的現金損益平衡率。這些數字包括按期租出的船舶，並根據新船交付情況進行調整。我們正在研究從 2021 年 4 月 1 日起的 365 天。

So in this graph, as an example, with a fleet average cash cost breakeven rate of $18,100 per day and assuming $30,000 on top of the average fleet earnings that the TCE rate would be $48,100 per day. And Frontline would then generate a cash flow per share after debt service of $3.45. With this, I leave the word to Lars again.

因此，在此圖中，作為範例，車隊平均現金成本損益平衡率為每天 18,100 美元，假設平均機隊收入為 30,000 美元，TCE 率為每天 48,100 美元。 Frontline 在償債後每股將產生 3.45 美元的現金流。說到這裡，我再次向拉斯轉告。

Thank you very much, Inger. Let's move to Slide 7 and have a look or a recap of the Q1 '21 tanker market. And it goes without saying that it's been somewhat demanding. So total world oil consumption rose by 4.3 million barrels from January to March and reached 96.5 million barrels per day. On the other hand, supply fell by 0.5 million barrels. This was mostly fueled by the actions from Saudi Arabia and their volunteer cuts to -- that ended up at 93.5 million barrels per day at the end of the quarter.

非常感謝你，英格。讓我們轉到幻燈片 7，回顧或回顧 21 年第一季的油輪市場。不用說，這有些要求。 1-3月全球石油消費總量增加430萬桶，達9650萬桶/日。另一方面，供應量減少了50萬桶。這主要是由沙烏地阿拉伯的行動及其自願減產推動的——截至本季末，日產量為 9,350 萬桶。

As we continue to draw on inventory, tanker demand remained basically unchanged. We did, during the quarter, see return of Libyan volumes. And we also had towards the end of the quarter the U.S. cold snap that created a lot of volatility. So tanker rates firmed towards the end of the quarter, and this is at the time quite positive because it actually is indicating a thinner balance than what may be perceived. So basically, to wrap up Q1, we see demand or consumption is running ahead of supply, and the drawn inventories is kind of mitigating that volume.

隨著庫存的持續消耗，油輪需求基本上保持不變。在本季度，我們確實看到了利比亞產量的回升。在本季末，美國的寒流也造成了很大的波動。因此，油輪運價在本季末趨於堅挺，這在當時是相當積極的，因為它實際上表明平衡比想像的要薄弱。因此，基本上，在第一季結束時，我們看到需求或消費超過了供應，而抽出的庫存在某種程度上減輕了這一數量。

If you look at the chart on the right-hand side, you see what I refer to as a ripple rather than a very strong market, but we see how quickly rates react where we saw, firstly, the Aframax market move in line with Libya opening up. And secondly, the Suezmax market reacted, and that was mostly fueled by the U.S. Gulf cold snap or the U.S. cold snap affecting the volume side of U.S. Gulf.

如果你看右邊的圖表，你會看到我所說的漣漪而不是非常強勁的市場，但我們看到利率反應有多快，首先，阿芙拉型油輪市場的走勢與利比亞一致開放。其次，蘇伊士型油輪市場做出了反應，這主要是受到美國海灣寒流或美國寒流影響美國海灣成交量的推動。

So let's move on to Slide 8 and look at the tanker order books. On all asset classes, we are observing delayed recycling. We see very little support for keeping older tonnage in this market, but they remain in the fleet list. Recycling prices are up 30% year-to-date and are now kind of being negotiated around $550 per long ton or $23 million for a VLCC. This is, to some extent, being outcompeted by the fact that we continue to see demand for vintage tonnage from undisclosed price -- buyers at relatively firm prices.

讓我們繼續看投影片 8，看看油輪訂單簿。在所有資產類別上，我們都觀察到回收延遲。我們認為在這個市場上保留舊噸位的支持很少，但它們仍然保留在船隊名單中。今年迄今為止，回收價格上漲了 30%，目前談判價格約為每長噸 550 美元，一艘 VLCC 為 2,300 萬美元。在某種程度上，我們繼續看到對未公開價格的老式噸位的需求——買家價格相對堅挺，這一事實在某種程度上被擊敗。

The overall tanker order book has shrunk year-to-date by approximately 4%, this as vessels deliver and new ordering has been fairly muted. We've seen on the VLCCs side 20 new -- 28 new orders placed. But as 25 vessels are delivered at the same time, the order book remains to be fairly flat. The VLCC order book stands at around 9% of the existing fleet, and the overall order book for tankers is up to around 7% of the existing fleet.

今年迄今為止，油輪訂單總量已減少約 4%，這是由於船舶交付和新訂單相當少。我們在 VLCC 方面看到了 20 艘新訂單——28 艘新訂單。但由於有 25 艘船同時交付，訂單量仍然相當平穩。 VLCC訂單量佔現有船隊的9%左右，油輪整體訂單量佔現有船隊的7%左右。

Let's move to Slide 9 and look at what's going on, on the asset prices. So the asset prices are on the move. We have, over the last 6 months, seen more than 170 new orders for containerships. We've also seen quite firm ordering on LPG and also seen confirmation of LNG orders, which has further contributed to the activity. And in line with the entire commodity space, steel prices have appreciated sharply. The fundamentals of the tanker market suggest the tightening of capacity over the coming years, and the regulatory tightening in respect of greenhouse gas emissions further supports the case of investing in modern, fuel-efficient ships. So propulsion is yet not the driver. Right now, it's the yard capacity or rather the lack of it which is driving prices together with this deal.

讓我們轉到幻燈片 9，看看資產價格發生了什麼。因此，資產價格正在變動。過去 6 個月，我們收到了超過 170 艘貨櫃船新訂單。我們也看到液化石油氣訂單相當堅定，也看到液化天然氣訂單的確認，這進一步促進了活動。與整個大宗商品領域一致，鋼材價格大幅上漲。油輪市場的基本面顯示未來幾年運力將收緊，而溫室氣體排放的監管收緊進一步支持了投資現代節能船舶的情況。所以推進力還不是驅動力。目前，是堆場容量，或者更確切地說是缺乏堆場容量，推動了這筆交易的價格。

So let's move to Slide 10 and look at the short-term outlook. So we're currently right in the middle of OPEC+ production increasing. They are increasing somewhat slowly, but they are adding to transportation demand. Currently, Asia and in particular, China, are coming out of refinery maintenance. And oil demand continues to recover. Now it's the U.S. and Europe in focus as we're coming out of lockdowns. Inventories, both on land and floating, are now normalized and at pre-COVID-19 levels. From where we are now and according to EIA, oil supply is expected to grow by 6 million barrels by year-end. And if you look at the graph on the left-hand side below, we see that most of these increases are expected to happen basically from where we stand now and over the summer.

讓我們轉到幻燈片 10，看看短期前景。因此，我們目前正處於歐佩克+增產的中期。它們的成長有些緩慢，但增加了運輸需求。目前，亞洲，特別是中國，煉油廠正在停止維護。石油需求持續復甦。現在，隨著我們解除封鎖，美國和歐洲成為焦點。陸地和浮動庫存現已正常化並處於 COVID-19 之前的水平。從目前情況來看，根據 EIA 的數據，到年底石油供應預計將增加 600 萬桶。如果你看一下下面左側的圖表，我們會發現大部分成長預計基本上會發生在我們現在和整個夏天的情況下。

The key to the demand bounces in 2021, you can find on the right-hand side. And we know that gasoline demand fell by 3.3 million barrels per day in 2020 and is now expected to grow by 1.8 million barrels per day in 2021. For jet, it affected the crude oil balances by 3.2 million barrels per day negative in 2020, and about 1.3 million barrels per day is expected to return this year. For diesel, we're actually adding more than we lost, 1.2 million barrels per day. And for fuel oil, we're keeping at level. Other kind of uses of oil is also adding to this at 0.7 million barrels per day.

2021 年需求反彈的關鍵，您可以在右側找到。我們知道，2020 年汽油需求下降了 330 萬桶/日，目前預計 2021 年將成長 180 萬桶/日。今年預計將恢復約130 萬桶/日。對於柴油，我們實際上增加的量比損失的量還要多，每天 120 萬桶。對於燃料油，我們保持在水平上。其他類型的石油用途也以每天 70 萬桶的速度增加。

Let's move over to Slide 11 and my summary. So basically to wrap this up, all key macro indicators point towards a firm recovery. Global GDP is expected up 6% this year. Asset prices are on the move as yard capacity is tightening and steel prices are increasing. As I've just mentioned, Global oil supply is expected to grow by 6 million barrels by the end of 2021. The COVID-19 vaccination pace in the developed countries is very encouraging, and countries are opening up.

讓我們轉到投影片 11 和我的總結。總而言之，所有關鍵宏觀指標都顯示經濟將強勁復甦。預計今年全球 GDP 將成長 6%。隨著堆場產能收緊和鋼材價格上漲，資產價格正在上漲。正如我剛才提到的，到2021年底，全球石油供應預計將增加600萬桶。

We can see on the graph below, which indicates activity within the various key segments of the shipping sector, that the cyclical recovery run has started. All key shipping sectors are firm, but tankers are lagging. Frontline is ideally positioned to capitalize on the anticipated recovery in tanker markets with our modern, spot-exposed, fuel-efficient fleet.

我們可以從下圖看到，該圖顯示了航運業各個關鍵領域的活動，週期性復甦已經開始。所有主要航運板塊均堅挺，但油輪表現落後。 Frontline 擁有得天獨厚的優勢，可以利用我們現代化、現貨供應、燃油效率高的船隊，充分利用油輪市場的預期復甦。

And with that, I would like to open up for questions and answers, please.

在此，我想開放大家提問並回答。

(Operator Instructions) Your first question today comes from the line of Jon Chappell of Evercore.

（操作員說明）您今天的第一個問題來自 Evercore 的 Jon Chappell。

Lars, I'd say that's a pretty balanced outlook on the market, maybe a bit more balanced than some of the optimism out there. Yet, obviously, the press release last week on the 6 new VLCCs indicate, I think, a lot of optimism about where the market is going. I think I asked this 3 months ago, but at this stage in the cycle, based on what you see for the next 12 months or so, do you think you're a more aggressive acquirer of assets? And if so, how much of this fuel propulsion question play into whether you're doing more newbuilds like you announced last week versus maybe the traditional Frontline activity in the secondhand market?

拉爾斯，我想說，市場前景相當平衡，也許比一些樂觀情緒更平衡。然而，顯然，上週有關 6 艘新 VLCC 的新聞稿表明，我認為人們對市場走向持樂觀態度。我想我是在 3 個月前問過這個問題的，但在周期的這個階段，根據您對未來 12 個月左右的情況的看法，您認為您是一個更積極的資產收購者嗎？如果是這樣，這個燃料推進問題在多大程度上影響到你們是否會像上周宣布的那樣建造更多新船，而不是二手市場上的傳統前線活動？

Well, it's all a question on -- well, first of all, I would say that we're always aggressive, but the right opportunity has to kind of come our way. But our overall view of the market has kind of firmed over the last couple of months, and we have more conviction now that we are moving in the right direction.

嗯，這都是一個問題——嗯，首先，我想說我們總是積極進取，但正確的機會必須出現在我們面前。但過去幾個月我們對市場的整體看法有所堅定，現在我們更加確信我們正在朝著正確的方向前進。

With regards to resale versus modern kind of vessels on the water, we obviously have to look at the current kind of spot market when we weigh to take a ship that's sailing in this market or taking a ship that will be delivered at a point in time where we're expected to be on full throttle again. So that's obviously a part of the consideration.

關於轉售與現代水上船舶的比較，當我們權衡購買在該市場航行的船舶或購買將在某個時間點交付的船舶時，我們顯然必須考慮當前的現貨市場預計我們將再次全力以赴。所以這顯然是考慮的一部分。

Secondly, it's actually not that many vessels for sale that kind of fall within where we want to invest. So you could say that although the activity in dry dock has been tremendous and the activity on ordering containerships and LPG has been so fantastic and so forth, the VLCC kind of asset market has been fairly muted year-to-date.

其次，實際上並沒有太多待售船舶屬於我們想要投資的範圍。因此，你可以說，儘管乾船塢的活動非常活躍，貨櫃船和液化石油氣的訂購活動也非常活躍等等，但今年迄今為止，VLCC 類資產市場卻相當平靜。

Okay. Now that makes complete sense. And then just a follow-on to that, as far as the financing is concerned, like I understand you're going to almost certainly get financing for these ships ordered or announced last week. It was a bit curious to me that for the down payment, given the cash you have on your balance sheet, you still drew down $50 million from the Hemen facility. So what's kind of the thought process around the amount of liquidity you want to keep, taking debt to pay down payments, not resuming the dividend despite a profitable quarter. I understand that the second quarter is weak and we have a kind of near-term choppy outlook, but should we think about just drawdowns of debt to finance newbuilds going forward and maybe retain the cash for a stronger market and then you can think about capital returns again?

好的。現在這是完全合理的。接下來，就融資而言，據我了解，您幾乎肯定會為上週訂購或宣布的這些船舶獲得融資。我有點好奇的是，考慮到您資產負債表上的現金，您仍然從赫門工廠提取了 5000 萬美元作為首付款。那麼，圍繞著你想要保留的流動性數量、借債償還首付款、儘管季度盈利而不恢復股息的思考過程是怎樣的？我知道第二季疲軟，我們的近期前景不穩定，但我們是否應該考慮僅減少債務來為未來的新建築融資，也許保留現金以應對更強勁的市場，然後你可以考慮資本再次回歸？

I think we have flexibility with respect to this facility that we are drawing on. We will establish the, let's say, debt financing. We intend to do that, I guess, probably in the second half of 2021, at least for the first vessel, and maybe also for all of them, depending upon the opportunities that arise when we look in -- or start to work on that.

我認為我們對於我們正在利用的這一設施具有靈活性。我們將建立債務融資。我想，我們打算在 2021 年下半年做到這一點，至少是第一艘船，也可能是所有船，這取決於我們觀察或開始研究時出現的機會。

So with respect to equity and repayment of this facility that we're drawing on, we will have flexibility going forward to decide how to do that and when to do -- or if we would like to use the ATM. That depends upon the share price and when we would like to raise equity, it also depends on that. So I think we will keep that a bit open a bit.

因此，就我們正在利用的這項設施的權益和償還而言，我們將可以靈活地決定如何以及何時進行，或者我們是否願意使用 ATM。這取決於股價，而我們何時想籌措股本，也取決於股價。所以我認為我們會保持開放一點。

Your next question today comes from the line of Randy Giveans of Jefferies.

今天你們的下一個問題來自 Jefferies 的蘭迪·吉文斯 (Randy Giveans)。

I guess, question, you talked a lot about the crude markets. Just looking also at the product tankers, maybe how do you view those 2 and maybe the timing of an inflection where you really start to see some rate improvement? And then with that, are you using any of this kind of soft patch to clean up some of your LR2s that were trading dirty to start trading clean going forward?

我想，問題是，您談了很多關於原油市場的問題。再看看成品油輪，也許您如何看待這兩個油輪，也許您真正開始看到一些費率改善的轉折點時機？然後，您是否使用任何此類軟補丁來清理您的一些髒交易的 LR2，以開始乾淨交易？

Well, to start with the first one, we are obviously in a recovery phase, and I think we've probably just finished kind of drawing on inventories. That's at least some of the stuff I'm seeing, which is relatively live, which means that -- and we're also in a refinery turnaround, a relatively heavy one. So actually, I was quite hopeful for the product market to start to run kind of already in March and -- but that kind of faded.

好吧，從第一個開始，我們顯然處於恢復階段，我認為我們可能剛剛完成了庫存的利用。這至少是我看到的一些東西，它們相對活躍，這意味著——我們也正處於煉油廠的轉型之中，這是一個相對沉重的轉型。所以實際上，我對產品市場在三月就開始運作充滿希望，但這種希望已經消失了。

I think in order for the product market to start to properly move, we need a bigger portion of the lost jet demand back. And -- but there is always a product market to be had around arbs kind of opening up. And for that, we need to see the refineries coming out of turnaround. So it's like a chicken and egg kind of discussion, and to be quite honest, I'm still kind of not 100% sure which would come first. So whether if it's going to be a pull or a push or whether if we're going to see increased demand for crude oil first pushing the VLCC market then drizzle into the LR2s as product is transported or the other way around. So it's difficult to say, to be quite honest.

我認為，為了讓產品市場開始正常運轉，我們需要挽回更大一部分失去的噴射機需求。而且——但圍繞著套利總是有一個開放的產品市場。為此，我們需要看到煉油廠走出困境。所以這就像是先有雞還是先有蛋的討論，說實話，我仍然不能 100% 確定哪個先出現。因此，無論是拉動還是推動，或者我們是否會看到原油需求的增加首先推動 VLCC 市場，然後在產品運輸時流入 LR2，或者反之亦然。所以說實話，很難說。

With regards to cleaning up, we have cleaned up 1 vessel and used kind of this opportunity in the market. It's not really an opportunity because it always comes kind of with some degree of cost. And we always have to remind ourselves that we actually have a lot of incremental income darting up when we're doing this. But I think it should be expected that we gradually will look at utilizing our vessels as LR2s because that's what they are rather than Afras.

關於清理工作，我們清理了 1 艘船，並利用了市場上的這個機會。這並不是真正的機會，因為它總是伴隨著一定程度的成本。我們必須時刻提醒自己，當我們這樣做時，我們實際上會獲得大量的增量收入。但我認為我們應該逐漸考慮將我們的船隻用作 LR2，因為它們就是這樣，而不是 Afras。

Yes. That makes sense. All right. And then, I guess, second question for me, you've shown some impressive expense control here with the market downturn, specifically more recently, a sharp reduction in vessel OpEx and G&A. So going forward, what's a good run rate for those 2 line items?

是的。這就說得通了。好的。然後，我想，對我來說第二個問題，隨著市場低迷，特別是最近，船舶運營支出和一般行政費用急劇減少，你們在這裡表現出了一些令人印象深刻的費用控制。那麼，展望未來，這兩個訂單項目的良好運行率是多少？

As I mentioned, for this quarter that we are into now, we will have a dry-docking cost which is higher than we had in the first quarter. We only had less than $600,000 of dry-docking costs in the first quarter. And I guess for the second quarter, we estimate around 7% or probably a bit more as well. So in that sense, of course, the operating expenses will increase in the next quarter. But this will vary a lot between quarters depending upon how much vessels we dry-dock. In the third quarter, we are planning to dry-dock 3 vessels instead of 6, meaning that it will be kind of half again of what I said for the second quarter that -- of cost, I mean.

正如我所提到的，在我們現在進入的這個季度，我們的乾塢成本將高於第一季。第一季我們的乾塢成本不到 60 萬美元。我估計第二季的成長率約為 7%，或者可能更高一些。因此，從這個意義上說，下一季的營運費用當然會增加。但這在季度之間會有很大差異，具體取決於我們幹塢的船隻數量。在第三季度，我們計劃將 3 艘船進乾塢，而不是 6 艘，這意味著這將是我在第二季度所說的成本的一半。

With respect to the admin expense, I would say that G&A would -- that what we have now in the first quarter is not the going rate. I think it's -- probably a couple of million dollars on top of that would be our going rate going forward.

關於管理費用，我想說，一般行政費用會——我們第一季現在的費用不是現行費用。我認為，除此之外，我們未來的利率可能是幾百萬美元。

A couple of million on top of the $6 million. Okay. So $9 million, is that a good run rate going forward?

除了 600 萬美元之外，還有幾百萬美元。好的。那麼 900 萬美元，這是一個不錯的運行率嗎？

That's probably a bit too high, but a couple of dollars on top of what is in the report, that is against -- something then -- $8.3 million or $8.5 million, whatever, something in that respect.

這可能有點太高了，但除了報告中的內容之外，還有幾美元，那就是——830萬美元或850萬美元，無論如何，在這方面的一些東西。

Your next question today comes from the line of Magnus Fyhr of H.C. Wainwright.

今天你們的下一個問題來自 H.C. 的 Magnus Fyhr。溫賴特。

Just most of my questions have been answered. But just kind of going back to Jon's question regarding your thoughts on ordering or buying more ships. Do you think there's an opportunity here? There seems -- like a lot of the operators are a little hesitant to buy ships or order ships at these levels given the uncertainty regarding propulsion technology. But just curious to see if you think there's further opportunities there, newbuilding versus acquiring resales.

我的大部分問題已經得到解答。但回到喬恩關於你對訂購或購買更多船隻的想法的問題。你覺得這裡有機會嗎？鑑於推進技術的不確定性，許多業者似乎對購買或訂購這些等級的船舶有點猶豫。但只是想知道您是否認為那裡還有更多機會，無論是新建還是收購轉售。

Well, we -- I think we will remain true to kind of our word and try not to add to the order book. And to be quite honest, where the current order book is, is quite difficult to gauge. Because I think you would struggle tremendously to order a VLCC, say, for delivery in Q4 2023. And if you should locate a slot there, I think the prices are probably north of 100. So it could be that we would rather then focus on acquiring either resales or modern ECO vessels on the water.

嗯，我想我們會信守諾言，盡量不增加訂單。老實說，目前的訂單簿在哪裡，很難衡量。因為我認為你會非常努力地訂購一艘 VLCC，例如在 2023 年第四季度交付。水上船。

So -- but I think it's important to note here that there has been a frantic activity with yards. And Inger and I'd like to compare some of the outlook going forward to the period we had in 2002, 2003. And at that time, we had a lot more yard capacity coming. Right now, we don't have that. So we even have yards starting to look at 2025, just to give you color on kind of the situation out there.

所以——但我認為重要的是要注意這裡已經發生了一場關於碼的瘋狂活動。 Inger 和我想將未來的一些前景與 2002 年、2003 年的情況進行比較。現在，我們沒有那個。因此，我們甚至有船廠開始展望 2025 年，只是為了讓您了解那裡的情況。

Okay. And you guys have a really modern fleet, and you mentioned the scrapping prices are picking up. What do you see out there as far as actually some of these older ships finally heading to the scrapyards? I mean current market prices -- I mean, current spot prices are very challenging for these older ships. And I was just curious if we -- if you expect to see that scrapping finally start to increase here during the summer.

好的。你們擁有一支非常現代化的機隊，而且你們提到報廢價格正在上漲。就這些舊船中的一些最終進入廢品場而言，您看到了什麼？我的意思是當前的市場價格——我的意思是，當前的現貨價格對於這些舊船來說非常具有挑戰性。我只是好奇我們是否——如果你期望看到這裡的報廢最終在夏季開始增加。

I think it will. Kind of our count stands at 8 VLCCs sold for scrap year-to-date. And I think it's 3 Suezmaxes. We have to remember, though, that there have been disruptions in the capacity for the recycling yards to actually accept offers due to COVID. So the pandemic has affected kind of efficiency there as well. I think where the prices are now on recycling steel, we should definitely see some action.

我想會的。今年迄今為止，我們已售出 8 艘 VLCC 進行報廢。我認為是 3 艘蘇伊士型油輪。但我們必須記住，由於新冠疫情，回收場實際接受報價的能力受到了乾擾。因此，大流行也影響了那裡的效率。我認為現在回收鋼材的價格，我們肯定應該看到一些行動。

But having said that, we still have this competition out in the market for vintage secondhand tonnage coming from undisclosed kind of parties, which most likely are involved in what -- the trade that I like to refer to as the dark web of oil, basically transporting either Venezuelan- or Iranian-sanctioned crudes.

但話雖如此，我們在市場上仍然存在來自未公開的各方的老式二手噸位的競爭，這些各方很可能參與了我喜歡稱之為石油暗網的交易，基本上運輸委內瑞拉或伊朗制裁的原油。

So I guess with the ongoing talks with the Iranians and potentially those sanctions being removed, what's your thoughts about those vessels finally maybe not being able to compete in an open market?

因此，我想隨著與伊朗人正在進行的談判以及可能取消的製裁，您對這些船隻最終可能無法在公開市場上競爭有何看法？

I think that could be a tremendous kicker to the conventional law-abiding tanker market. And it's basically -- we all talk about the Cosco moment in the tanker industry. And I think you could have that. Because suddenly, at least with the nuclear deal between U.S. and Iran, you're going to have quite a lot of volume that needs compliant ships to trade kind of within the compliant market.

我認為這可能對傳統守法油輪市場產生巨大的推動作用。基本上，我們都在談論油輪產業的中遠時刻。我想你可以擁有它。因為突然間，至少隨著美國和伊朗之間的核協議，你將有相當多的交易量需要合規船舶在合規市場內進行交易。

Okay. Great. And just one final question, if I may, to Inger or you, regarding the dry-docking schedule. What's -- are you trying to do all the dry-dockings ahead of the fourth quarter? Or you think you will have some ships in the fourth quarter as well, just kind of positioning yourself for a market recovery?

好的。偉大的。如果可以的話，我想問英格或你們最後一個問題，關於乾船塢時間表。你想在第四季之前完成所有的乾船塢工作嗎？還是您認為第四季也會有一些船舶，只是為市場復甦做好準備？

We will not do any dry-dockings in the fourth quarter. It's only in the second and the third.

第四季我們不會進行任何進塢活動。僅限於第二次和第三次。

(Operator Instructions) We do have one more question at this time. This comes from the line of Chris Tsung.

（操作員說明） 目前我們還有一個問題。這是出自Chris Tsung的血統。

I wanted to just kind of dig in just a little bit more to a question that was asked a bit earlier regarding the OpEx. Saw that it kind of came down significantly from Q2 -- from Q4, roughly around 20%. And just looking back at your previous presentation of the OpEx, the daily OpEx for like the Suezmax is like around $9,700 a day. And in this presentation, it's down at like $7,100. So maybe if you can help explain how that -- this was achieved.

我想進一步深入探討之前提出的有關營運支出的問題。發現它比第二季和第四季顯著下降，大約下降了 20% 左右。回顧您先前對營運支出的介紹，蘇伊士型油輪的每日營運支出約為每天 9,700 美元。在本次演示中，價格降至 7,100 美元左右。所以也許你可以幫助解釋一下這是如何實現的。

So the OpEx will vary between the quarters, as I said, due to the dry-dock of the vessels, whether we are dry-docking or not in a way. And in this particular quarter you are referring to with the Suezmaxes having a high OpEx. That was due to that you had dry-dockings of Suezmaxes in that quarter, while now you only have small dry-docking costs, which didn't really affect the OpEx.

因此，正如我所說，由於船舶的乾塢，無論我們是否在某種程度上進行乾塢，每個季度的營運支出都會有所不同。在這個特定的季度，您指的是蘇伊士型油輪具有較高的營運支出。這是因為您在該季度進行了蘇伊士型油輪的乾塢，而現在您只有很小的干塢成本，這並沒有真正影響營運支出。

But I think to further clarify, we actually take the actual dry-docking costs in the quarter.

但我認為為了進一步澄清，我們實際上採用了本季的實際幹塢成本。

We expense the dock.

我們花費碼頭費用。

We expense it.

我們花費它。

We don't capitalize as many of our peers do.

我們不像許多同行那樣進行資本化。

So that's why we get that volatility in that.

這就是為什麼我們會出現波動。

Yes.

是的。

Right. I see. I see. Okay, understood. I guess just following up on another question is for your -- the 6 VLCC resales that's going to be starting delivery in 2022, could you perhaps expand on like the cadence of the delivery? Is it more front-loaded or back-loaded? I know one is delivering in 2023. Just wanted to know if it's going to be smooth out or -- any color would be appreciated.

正確的。我懂了。我懂了。好的，明白了。我想接下來的另一個問題是針對您的——6 艘 VLCC 轉售將於 2022 年開始交付，您能否擴展一下交付的節奏？是前置的多還是後置的多？我知道其中一個將於 2023 年交付。

Well, it's going to be fairly smooth, to be quite honest, the first vessel delivering very early in 2022. Obviously, we have a little bit of flexibility in the deliveries at this stage so -- and then coming like pros on the string and the last one coming very, very early in 2023.

嗯，說實話，第一艘船將於 2022 年初交付，這將相當順利。非常非常早到來。

Okay. And -- great. And just the last question, I noticed in the presentation or in your press release, there was a purchase -- there's a decision to purchase shares in Golden Ocean, just I think only around $400,000, so it's not material. It's not big, but I just wanted to kind of see if you can go into your details on decision to purchase shares in Golden Ocean.

好的。而且——太棒了。就最後一個問題，我在簡報或你們的新聞稿中註意到，有一項購買——決定購買 Golden Ocean 的股票，我認為只有大約 40 萬美元，所以這並不重要。這並不大，但我只是想看看你是否可以詳細說明購買金海股票的決定。

Yes. This is related to that we have a forward contract where we -- for Golden Ocean shares where we then, through that contract, in a way, got the possibility to take part in that rights issue, which Golden Ocean has. So it was not a huge amount. It was few shares. But anyway, we did it because it was in the money anyway.

是的。這與我們有一份遠期合約有關，對於金海股票，我們透過該合同，在某種程度上有可能參與金海擁有的供股。所以這並不是一個很大的數字。股份很少。但無論如何，我們這樣做是因為無論如何這是在錢裡的。

There are no further questions at this time. Inger, Lars, back to you.

目前沒有其他問題。英格、拉斯，回到你們身邊。

Yes. Well, thank you very much for hosting. And also thank you very much for listening in. Thank you to the entire Frontline team for fantastic efforts in Q1 and stay safe, everyone.

是的。嗯，非常感謝您的主持。也非常感謝您的收聽。

That does conclude our conference for today. Thank you all for participating.

我們今天的會議到此結束。感謝大家的參與。