First take (figures released in Oslo on 11/27)
- Revenue of $490.3M
- Profit of $60.5M
- Adj Net profit of $75.4M
- Avg TCE rates VLCC/Suezmax/LR2-Afra $39,600/$39,900/$36,000 daily
- Sold oldest Suezmax for profit
- Refinanced debt on 10-Suezmax vessels, releasing additional cash in Q4 2024
Though I strategically changed plans with FRO on 11/25, I was not surprised by the results. Q3 has usually been weaker, so from early Sept I had been thinking Q3 2024 will be no different. A Suezmax sale means all their vessels are ECO now. If the market is heading into weaker conditions, an ECO fleet gives FRO vessels a favored position among charterers. Dividend cut in Q3? Expected. The div amount was the uncertainty.
Though one should not think this way - $0.34 * 4 = $1.36/sh annualized.
Based on current FRO price ($18.07 on 11/26 close), that’s > 7.5%
Let’s see how the market reacts in the morning