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Q3 2012 Results

November 29, 2012

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MATTERS DISCUSSED IN THIS DOCUMENT MAY CONSTITUTE FORWARD-LOOKING STATEMENTS. THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 PROVIDES SAFE HARBOR PROTECTIONS FOR FORWARD-LOOKING STATEMENTS IN ORDER TO ENCOURAGE COMPANIES TO PROVIDE PROSPECTIVE INFORMATION ABOUT THEIR BUSINESS. FORWARD-LOOKING STATEMENTS INCLUDE STATEMENTS CONCERNING PLANS, OBJECTIVES, GOALS, STRATEGIES, FUTURE EVENTS OR PERFORMANCE, AND UNDERLYING ASSUMPTIONS AND OTHER STATEMENTS, WHICH ARE OTHER THAN STATEMENTS OF HISTORICAL FACTS.

FRONTLINE DESIRES TO TAKE ADVANTAGE OF THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 AND IS INCLUDING THIS CAUTIONARY STATEMENT IN CONNECTION WITH THIS SAFE HARBOR LEGISLATION. THE WORDS “BELIEVE,” “ANTICIPATE,” “INTENDS,” “ESTIMATE,” “FORECAST,” “PROJECT,” “PLAN,” “POTENTIAL,” “WILL,” “MAY,” “SHOULD,” “EXPECT” “PENDING” AND SIMILAR EXPRESSIONS IDENTIFY FORWARD-LOOKING STATEMENTS.

THE FORWARD-LOOKING STATEMENTS IN THIS DOCUMENT ARE BASED UPON VARIOUS ASSUMPTIONS, MANY OF WHICH ARE BASED, IN TURN, UPON FURTHER ASSUMPTIONS, INCLUDING WITHOUT LIMITATION, MANAGEMENT'S EXAMINATION OF HISTORICAL OPERATING TRENDS, DATA CONTAINED IN FRONTLINE’S RECORDS AND OTHER DATA AVAILABLE FROM THIRD PARTIES. ALTHOUGH FRONTLINE BELIEVES THAT THESE ASSUMPTIONS WERE REASONABLE WHEN MADE, BECAUSE THESE ASSUMPTIONS ARE INHERENTLY SUBJECT TO SIGNIFICANT UNCERTAINTIES AND CONTINGENCIES WHICH ARE DIFFICULT OR IMPOSSIBLE TO PREDICT AND ARE BEYOND FRONTLINE’S CONTROL, YOU CANNOT BE ASSURED THAT FRONTLINE WILL ACHIEVE OR ACCOMPLISH THESE EXPECTATIONS, BELIEFS OR PROJECTIONS. FRONTLINE UNDERTAKES NO DUTY TO UPDATE ANY FORWARD-LOOKING STATEMENT TO CONFORM THE STATEMENT TO ACTUAL RESULTS OR CHANGES IN EXPECTATIONS.

IMPORTANT FACTORS THAT, IN FRONTLINE’S VIEW, COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE DISCUSSED IN THE FORWARD-LOOKING STATEMENTS INCLUDE, WITHOUT LIMITATION: THE STRENGTH OF WORLD ECONOMIES AND CURRENCIES, GENERAL MARKET CONDITIONS, INCLUDING FLUCTUATIONS IN CHARTERHIRE RATES AND VESSEL VALUES, CHANGES IN DEMAND IN THE TANKER MARKET, INCLUDING BUT NOT LIMITED TO CHANGES IN OPEC'S PETROLEUM PRODUCTION LEVELS AND WORLD WIDE OIL CONSUMPTION AND STORAGE, CHANGES IN FRONTLINE’S OPERATING EXPENSES, INCLUDING BUNKER PRICES, DRYDOCKING AND INSURANCE COSTS, THE MARKET FOR FRONTLINE’S VESSELS, AVAILABILITY OF FINANCING AND REFINANCING, ABILITY TO COMPLY WITH COVENANTS IN SUCH FINANCING ARRANGEMENTS, FAILURE OF COUNTERPARTIES TO FULLY PERFORM THEIR CONTRACTS WITH US, CHANGES IN GOVERNMENTAL RULES AND REGULATIONS OR ACTIONS TAKEN BY REGULATORY AUTHORITIES, POTENTIAL LIABILITY FROM PENDING OR FUTURE LITIGATION, GENERAL DOMESTIC AND INTERNATIONAL POLITICAL CONDITIONS, POTENTIAL DISRUPTION OF SHIPPING ROUTES DUE TO ACCIDENTS OR POLITICAL EVENTS, VESSEL BREAKDOWNS, INSTANCES OF OFF-HIRE AND OTHER IMPORTANT FACTORS. FOR A MORE COMPLETE DISCUSSION OF THESE AND OTHER RISKS AND UNCERTAINTIES ASSOCIATED WITH FRONTLINE’S BUSINESS, PLEASE REFER TO FRONTLINE’S FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION, INCLUDING, BUT NOT LIMITED TO, ITS ANNUAL REPORT ON FORM 20-F.

THIS PRESENTATION IS NOT AN OFFER TO PURCHASE OR SELL, OR A SOLICITATION OF AN OFFER TO PURCHASE OR SELL, ANY SECURITIES OF FRONTLINE.

Forward looking statements

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Agenda

■ Third Quarter 2012 Highlights and Transactions

■ Financial Review

■ Newbuildings

■ Market Update

■ Outlook

■ Q & A

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Highlights and Transactions

Third Quarter 2012

■ Termination of long term charter party with SFL for OBO carriers

■ Front Climber terminated in October

■ Agreed to terminate Front Driver in November

■ Agreed with NAT that Frontline’s nine Suezmax vessels will leave the Orion Pool

■ Subsequently sold Frontline’s 50% ownership of Orion to NAT

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Financial Highlights

Q3 - 2012 results

■ Net loss: $49m

■ Net loss per share: $0.63

Nine months 2012 results

■ Net loss: $66.2m

■ Net loss per share: $0.85

No dividend declared in Q3-2012

Share price NYSE November 28 2012: $3.43

– Market cap: $267m

Third Quarter 2012

-0.63

-0.31 0.09

-6.80

-2.13

-0.45

0.200.02 0.10

-7.00

-6.00

-5.00

-4.00

-3.00

-2.00

-1.00

0.00

1.00

Q3 Q2 Q1 FY Q3 Q2 Q1

2012 2011

EPS ($) Dividend per share reported ($)

-49

-24 7

-530

-166

-35

15

-550

-450

-350

-250

-150

-50

50

Q3 Q2 Q1 FY Q3 Q2 Q1

2012 2011

Net Income/loss ex sales ($million) Sales profit/loss ($million)

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Income Statement

Financial Review

2011 2012 CONDENSED CONSOLIDATED INCOME STATEMENTS 2012 2011

Jul-Sept Jul-Sept (in thousands of $) Jan-Sept Jan-Sept

173,914 126,809 Total operating revenues 470,671 628,121

3,787 3,288 Gain on sale of assets and amortization of deferred gains 19,373 4,984

72,061 64,049 Voyage expenses and commission 189,525 228,114

(1,581) - Profit share expense (income) - 829

- 9,904 Contingent rental expense 42,631 -

45,378 36,600 Ship operating expenses 101,511 147,912

16,740 8,880 Charter hire expenses 31,099 50,843

9,871 8,338 Administrative expenses 24,701 26,489

121,443 - Impairment loss on vessels 13,141 121,443

49,603 28,301 Depreciation 86,892 151,540

313,515 156,072 Total operating expenses 489,500 727,170

(135,814) (25,975) Net operating gain (loss) 544 (94,065)

251 40 Interest income 90 3,929

(32,522) (23,551) Interest expense (71,813) (104,309)

(111) (92) Share of results from associated companies 167 (411)

21 79 Foreign currency exchange gain 100 171

1,707 341 Other non-operating items 4,317 9,969

(166,468) (49,158) Net loss before taxes and noncontrolling interest (66,595) (184,716)

(76) (95) Taxes (257) (183)

388 236 Net loss (income) attributable to noncontrolling interest 664 (1,036)

(166,156) (49,017) Net loss attributable to Frontline Ltd. (66,188) (185,935)

$(2.13) $(0.63) Basic loss per share ($) $(0.85) $(2.39)

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Income on time charter basis

Financial Review

$/day YTD Q3 Q2 Q1 FY Q3 Q2 Q1

VLCC Spot DH 23 700 13 300 31 500 25 400 20 200 12 600 23 900 27 400

VLCC w hole fleet 23 200 12 300 31 000 25 600 22 800 17 000 26 100 28 600

Suezmax Spot DH 15 500 10 500 16 200 19 500 12 600 7 800 14 500 16 000

Suezmax w hole fleet 15 500 10 500 16 200 19 500 14 100 9 500 15 800 17 300

Orion Suezmax pool 15 300 11 100 17 400 19 200 13 600 7 600 16 200 17 700

OBO 33 300 33 700 28 100 37 800 36 700 38 200 31 300 36 300

2012 2011

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Ship operating expenses/Off-hire

Financial Review

Tentative drydock schedule/no. of vessels

– Q4-2012: 1

11 800

11 100

9 000

9 900

9 200 9 300

10 80010 200

6 000

7 000

8 000

9 000

10 000

11 000

12 000

13 000

Q3 Q2 Q1 FY Q4 Q3 Q2 Q1

2012 2011

Total fleet opex ($/day)

4

5

9

1

3 3

2

0

1

2

3

4

5

6

7

8

9

10

Q3 Q2 Q1 FY Q4 Q3 Q2 Q1

2012 2011

Number of vessels drydocked

144 141

41

677

86

159211 221

0

100

200

300

400

500

600

700

800

Q3 Q2 Q1 FY Q4 Q3 Q2 Q1

2012 2011

Off hire (days)

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Balance Sheet

Financial Review

Balance sheet

(in $ million) 2012 2012 2011

Sept 30 June 30 Dec 31

Cash 165 177 161

Restricted cash 76 89 101

Other Current assets 149 176 149

Long term assets:

Vessels 1 222 1 252 1 334

Newbuildings 20 14 13

Other long term assets 94 95 83

Total assets 1 726 1 803 1 841

Current liabilities 191 194 167

Long term liabilities 1 387 1 412 1 460

Noncontrolling interest 12 12 12

Frontline Ltd. stockholders' equity 136 185 201

Total liabilities and stockholders' equity 1 726 1 803 1 841

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Cash Cost Breakeven

Comments to B/E rates:

– Included in cash B/E rates are: BB hire, opex , interest expense and admin. costs.

– B/E rates exclude vessels on short term TC-in, vessels on BB-out, capex. and ITCL vessels

Estimated Cash cost breakeven rates

for the remainder of 2012 ($/day)

VLCC 23,400

Suezmax 16,200

OBO 12,400

Financial Review

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Newbuilding Overview

■ Total newbuilding program as of November 28:

– Two Suezmax tankers

– Remaining installments to be paid approx. $94.2m

Newbuilding

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Frontline Fleet

Incl. vessels on commercial management & ITCL, excl. newbuildings

Total: 55 As per end Q3-12 DH: Double Hull, SH: Single Hull

Corporate Overview

VLCC SH 2

VLCC DH 35

Suezmax DH 15

OBO 3

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Frontline Fleet

Corporate Overview

DH 22 9 % 39 700 20 8 % 39 900

SH 2

DH 8 10

OBO 3 74 % 64 400 2 91 % 63 900

Newbuildings 2

VLCC DH 6 67 % 6 53 %

Suezmax DH 3 100 % 3 100 %

VLCC DH 7 8

Suezmax DH 4 4

Total Fleet (ex. Newbuildings) 55 53

Total Fleet (ex. Newbuildings, ITCL, SH BB coverage, Com Mgt) 33 12 % 52 100 32 11 % 52 500

Total Fleet (ex. Newbuildings, ITCL incl. SH BB coverage, Com Mgt) 46 9 % 44 8 %

- The average TC coverage percentage is based on estimated total trading days

- TC-in vessels are assumed redelivered upon contract expiration

2013

No. of

vessels

Av. TC

Coverage

Av. Net

TC/BB Rate

($/day)

No. of

vessels

(per end

2013)

Av. TC

Coverage

(whole year)

Av. Net

TC/BB Rate

($/day)

VLCC

Suezmax

ITCL

Q4 2012

Com Mgt

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Earnings & Market Factors Q3 – Average Market earnings / Marex

■ VLCC : -$3,750/day (Q2: $22,750/day)

■ Suezmax : $9,500/day (Q2: 18,000/day)

The Market:

■ Reduced crude oil imports to China

■ VLCC fleet increased by seven vessels and Suezmax fleet increased by four vessels during the quarter

■ Negative sentiment in the market

■ Lack of westbound VLCC cargoes

■ IEA expected Q4 global oil demand has been reduced to 90.1 mb/d, reflecting persistent weakness in Europe

■ OPEC crude exports fell to a nine month low at the end of Q3.

■ Global refinery throughputs averaged 75.9 mb/d in Q3, as recovering Chinese runs and strong OECD margins, notably in Europe offset US hurricane outages. A seasonal dip is expected to leave refinery runs at an average of 75.5 mb/d in Q4

Market Update

Source: MAREX, IEA, Clarksons

0

20 000

40 000

60 000

80 000

100 000

Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

$ / d

ay

VLCC

Q3 2011 2012 Ave 2008 - 2012

0

10 000

20 000

30 000

40 000

50 000

60 000

70 000

80 000

90 000

100 000

Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

$ / d

ay

SUEZMAX

Q3 2011 2012 Ave 2008 - 2012

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VLCC Fleet

Market Update

Source: Fearnleys November 2012

Delivery Schedule

Fleet

Current fleet & Orderbook

Slippage

11 vessels ytd Current Fleet 622 88

DH Fleet 600 43

SH (DS, DB, SS) Fleet 22 Estimated deliveries 2012 58

Delivered 2012

Orderbook

16

Suezmax Fleet

Market Update

Source: Fearnleys November 2012

Delivery Schedule

Fleet

Current fleet & Orderbook

Slippage

14 vessels ytd Current Fleet 466 Orderbook 63

DH Fleet 457 Delivered 2012 44

SH (DS, DB, SS) Fleet 9 Estimated deliveries 2012 50

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Rates

TC MARKET

Source: Clarksons

Market Update

NEWBUILDING

0

10 000

20 000

30 000

40 000

50 000

60 000

70 000

80 000

Ap

r-05

Se

p-0

5

Fe

b-0

6

Jul-

06

Dec-0

6

Ma

y-0

7

Oct-

07

Ma

r-0

8

Au

g-0

8

Jan

-09

Jun

-09

Nov-0

9

Ap

r-10

Se

p-1

0

Fe

b-1

1

Jul-

11

Dec-1

1

Ma

y-1

2

Oct-

12

$ / D

AY

3Y TC VLCC 3Y TC SUEZMAX

50

60

70

80

90

100

110

120

130

140

150

160

170

180

20

06

-02

20

06

-07

20

06

-12

20

07

-05

20

07

-10

20

08

-03

20

08

-08

20

09

-01

20

09

-06

20

09

-11

20

10

-04

20

10

-09

20

11

-02

20

11

-07

20

11

-12

20

12

-05

20

12

-10

M U

SD

VLCC NB SMAX NB

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Outlook General

■ Increase in tonnage miles as Motiva have restarted their Port Arthur refinery importing from AG to Caribs

■ 10 second hand VLCC sold to non regular trading buyers

■ Vessels still slow speeding reducing available tonnage

■ Big owners controlling the available tonnage in tight windows

■ Consensus is that the recent rate spike could be short lived and that recovery in the crude tanker market could take some time

Market Update

Source: Various

Frontline

■ Restructuring of the fleet continues, older non-core vessels sold and one TC vessel will be redelivered in December

■ Continued outperformance of peers in the VLCC segment (why not let us run your VLCCs!) –suezmax segment was disappointing

■ Frontline will continue to remain cautious and focus its resources on the present activities until a clearer sign of recovery can be seen in the tanker market

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Questions?