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What to Know before Frontline's 2Q17 Results

PART:
1 2 3 4
Part 3
What to Know before Frontline's 2Q17 Results PART 3 OF 4

Where Will Frontline’s Earnings Stand in 2Q17?

FRO’s earnings

As we discussed in the previous part of this series, Wall Street analysts expect a 45% YoY (year-over-year) fall in Frontline’s (FRO) 2Q17 revenues. In this part of our series, we’ll see what analysts are expecting for Frontline’s EBITDA (earnings before interest, tax, depreciation, and amortization) and EPS (earnings per share) for 2Q17 and 2017.

Where Will Frontline&#8217;s Earnings Stand in 2Q17?

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EBITDA estimates

Along with a drop in revenues, analysts estimate a drop in FRO’s EBITDA as well. The analysts’ EBITDA estimate for 2Q17 is $55 million, which would mean a 24% drop from $72.8 million in 2Q16.

For 3Q17, the EBITDA estimate stands at $48 million. The estimates for 2017 and 2018 are $243 million and $302 million, respectively, compared with FRO’s 2016 EBITDA of $271 million.

Based on its 1Q17 EBITDA, Frontline’s EBITDA margin was 42.9%. Based on its estimated revenue and its estimated EBITDA, Frontline’s estimated 2Q17 EBITDA margin is now 52.7%.

Peer EBITDAs

Many crude (DBO) tanker companies have already released their 2Q17 earnings and saw the following results:

  • Teekay Tankers’ (TNK) 2Q17 EBITDA of $26.14 million came in lower than its 2Q16 EBITDA of $62.7 million.
  • Gener8 Maritime’s (GNRT) EBITDA was $38.1 million, which was lower than its $70.9 million in 2Q16.
  • Nordic American Tankers’ (NAT) 2Q17 EBITDA came in at $15.1 million, which was lower than its 2Q16 EBITDA of $39.06 million.
  • DHT Holdings’ (DHT) 2Q17 EBITDA was $36.7 million, which was lower than its $63.7 million in 2Q16.

EPS is also expected to fall for Frontline. Wall Street analysts forecast EPS of -$0.04, compared with $0.09 in 2Q16.

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