FRONTLINE FALLS INTO THE RED WITH $7 MILLION 2002 LOSS

FRONTLINE FALLS INTO THE RED WITH $7 MILLION 2002 LOSS    Frontline Ltd., the large tanker shipping operator based in Hamilton, Bermuda, reported a $6.9 million net deficit for last year, representing a near $400-million adverse swing in profitability when compared to a net income of $382.7 million in 2001.
   Operating income after depreciation and amortization for last year fell to $97.7 million, from $384.8 million in 2001.
   Net operating revenues decreased to $429 million, from $647.3 million, as timecharter rates for very large crude carriers (VLCC) fell to an average of $22,500 per day in 2002, from $40,800 per day in 2001.
   Frontline said that its net loss for 2002 is after a charge of $14.1million relating to the adoption of Financial Accounting Standard 142 on goodwill and other intangible assets. Net income for 2002 before the cumulative effect of change in accounting principle was $7.2 million.
   For the quarter ended Dec. 31, 2002, Frontline earned a net income of $43.7 million, down from $67.1 million a year earlier.
   Nevertheless, Frontline reported that the tanker market showed “a strong recovery” in the fourth quarter, mainly caused by increased OPEC production starting in August/September. The sinking of the tanker “Prestige” last November “put pressure on European politicians to tighten the legislation for tankers, and also had immediate effects on the chartering policies of several of the major oil companies,” a spokesman for Frontline said.
   The tanker shipping group reported that 2003 has started with very strong VLCC and Suezmax markets. It expects to make a profit of more than $150 million in the first quarter.