Good day. Thank you for standing by. Welcome to the Q1 2026 Frontline Plc Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question- and- answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Mr. Lars Barstad, CEO. Please go ahead. Thank you. Dear all, and thank you for dialing into Frontline's Quarterly Earnings Call. Unprecedented times springs to mind as we report in Q1 2026, well into the first half of the year. I've been in this industry for more than 20 years, and I did not imagine us in a situation for this duration where the Strait of Hormuz has been effectively closed. With the OPEC, OK, and volatile political narrative these days, the Frontline team focus on the real cash-generating business to be done, not speculating too far into the future. We have put the most profitable quarter since 2004 behind us and are well into a potentially even more rewarding one. I will get back to how we analyze the situation between the call. Before I give the [inaudible] Inger, I'll run through our TC numbers on slide three in the deck. In the first quarter of 2026, Frontline achieved $103,500 per day on our VLCC fleet, $72,400 per day on our Suezmax fleet, and $50,700 per day on our LR2/Aframax fleet. Far in the second quarter of 2026, 82% of our VLCC days are booked at $181,700. 79% of our Suezmax days are booked at $131,300 per day, and 68% of our LR2/Aframax days are booked at $125,000 per day. Six digits across the board. All numbers in this table are on a loaded to discharge basis with implications of ballast days at the end of the quarter. I'll now let Inger take you through the financial highlights. Thanks, Lars, and good morning and good afternoon, ladies and gentlemen. We can turn to slide four and look at the profit statement highlights. We report a profit of $559 million, or $2.51 per share, and adjusted profit of $344.9 million or $1.55 per share in the first quarter of 2026. The adjusted profit in the first quarter increased by $114.5 million compared with the previous quarter, and that was primarily due to an increase in our time charter earnings of $112 million from $424.5 million in the previous quarter to $536.5 million in this quarter. Ship operating expenses increased by $5.9 million from previous quarter, and that was mainly due to a decrease in supplier rebates of $5.4 million in the quarter. Administrative expenses, excluding the synthetic option revaluation loss of $5.8 million in the first quarter and gain of $0.5 million in the fourth quarter of 2025, increased by $8.5 million from the previous quarter. That was primarily due to synthetic option exercises in the first quarter of 2026. The adjusted interest expense decreased by $9.8 million from previous quarter, and that was due to lower debt and decrease in interest rates and margins. Depreciation decreased by $6.2 million from previous quarter due to sales of VLCCs in the period. Lastly, income tax expense decreased by $0.6 million from the previous quarter. Let's then look at the balance sheet on slide five. Frontline has a solid balance sheet and strong liquidity of $945 million in cash and cash equivalents, including undrawn amounts of revolver capacity of $473 million, marketable securities and minimum cash requirements as of the 31st of March 2026. We have no meaningful debt maturities until 2030. Remaining new building commitments at the end of the first quarter was $925 million, which relates to the acquisition of the nine new buildings from affiliates of Hemen. The company has secured new building financing of up to $737 million as set out in the press release. Let's look at slide 6, fleet composition, [inaudible]. Our fleet consists of 33 VLCCs, 21 Suezmax tankers and 18 LR2 tankers. It has an average age of 7.5 years and consists of 100% ECO where over 54% are scrubber fitted. We estimate the average cash break-even rate for the next 12 months of approximately $24,300 per day for VLCCs, $24,300 per day for Suezmax tankers, and $23,600 per day for the LR2 tankers. That gives a fleet average estimate of about $24,100 per day. This number includes dry dock costs for six VLCCs, three Suezmax tankers, and eight LR2 tankers. The fleet average estimate excluding dry dock costs is about $23,000 per day or $1,100 per day less. The recorded OpEx included dry dock in the first quarter of $11,300 per day for VLCCs, $9,100 per day for Suezmax tankers, and $10,900 per day for LR2 tankers. This includes dry dock of four VLCCs and three LR2 tankers. The Q1 2026 fleet average OpEx excluding dry dock was $8,900 per day. Let's look at slide seven on cash generation. Following that, we have been entering into one year time charter agreements, and we had a fleet renewal in the first quarter and also in the second quarter. Spot days for the next 12 months is about 23,700 days. Frontline has substantial cash generation potential with 27,900 earning days annually. As you can see from this slide, the cash generation potential basis current fleet, TC rates and TCE as of 22 May 2 026, is $1.5 billion or approximately $7 per share. That provides a cash yield of 18% based on the current share price. If we look at a 30% increase from current spot markets, that will increase the cash generation potential to about $2.1 billion or $9.51 per share and equals a 30% decrease from current spot markets would decrease the cash generation potential to about $1 billion or $4.41 per share. With this, I leave the words to Lars Barstad again. Thank you, Inger. Let's move to slide eigth and look at some of the market highlights that we're going to go through in this deck. First of all, I'd like to remind the audience that we've had tightening fundamentals in the tank markets ever since around this time last year, prior to the Middle East conflict. We reached an unprecedented situation after the 28th of February with the Strait of Hormuz effectively closed. The chart on the top hand right side kind of indicates this. Here you see the year-over-year weekly changes in flows, whereas the Middle East Gulf drops dramatically, starting in week 12. The U.S.-Iran on-off peace talks and the tightening, potentially easing of Iran-related sanctions, together with certainty on Russia or Russian oil assets creates a lot of volatility. The market are starting to focus on the potential long-term implications coming from the current situation in the Middle East and more so if we can imagine the situation getting solved. We're going to see restocking of inventories, increased strategic storage, especially amongst Asian importers. We're also going to see higher focus on diversification of oil supply now that we've seen how vulnerable you can be being dependent on purely Middle East supply. We also see that order books continue to grow as they stretch into 2030 delivery windows now. As the prices continue to appreciate, as freight market outlook remains firm, and we see a fairly high activity on longer firm time charter market or contracts. Just want to give you a small little kind of hint on the bottom left-hand side chart. We're basically not only using the TD3C index, which is the Middle East Gulf loading index to China. We're also using the TD15 index outside of the Middle East Gulf West Africa to China. It looks quite bleak, only kind of rewarding us with $100,000 per day, this is 4x our cash break-even levels, so it's still very good money. We wish we could have made $400,000 per day every day, this is a very much a theoretical exercise as the market is right now. If we move to slide nine, I'm going to take you through two fairly complicated slides, but I think needed for this session, as we are in the situation we are. First of all, Strait of Hormuz closure is very much a VLCC event. This is the big kind of ride for the VLCC. This is where the most volume is listed on VLCC, transporting oil both to the east and to the west. We've seen kind of prior to the closure that the daily tied-up VLCC in this market has been on average 491 vessels. This consists of laden drydock vessels that are doing cargo ops or other stuff. We have, at any point in time, have had stopped ballasters east of Suez, and we've always had vessels waiting to load in the Red Sea. Basically, when the straits closed, we had a massive loss of 130 ships that were so-called laden drydocking or doing cargo ops. This is the dark blue baseline in the chart in the middle here. We had an increase of 21 vessels waiting, loading in the Red Sea. This is a daily tied up tonnage, so it shouldn't really be looked at as an absolute number. Suddenly we had 41 VLCCs laden, loaded with oil, waiting inside the Middle East Gulf. You had 55 VLCC equivalents stopped and in ballast east of Suez. This brought us back to 480 VLCCs after the Hormuz closed. Basically, only a reduction of 11 VLCC equivalents in this extremely severe situation for the VLCC segment in special. If we move to slide 10 and look at how the flows developed post-closure. We were at 17.7 billion barrels per day, from various suppliers inside the Middle East Gulf. We lost 5.9 million barrels per day from Saudi, 3.2 from Iraq, almost two from UAE, and on it goes. 1.4 from Kuwait and almost one million barrels from Qatar. As we proceeded, UAE were able to increase the throughput in the pipeline ending up in Fujairah of almost one million barrels per day. Saudi Arabia started to utilize the Yanbu pipeline going from Middle East Gulf out to the Red Sea, increasing by 3.5 million barrels per day. The rest of the world has gradually, towards where we are now, increased outputs by 3.3 million barrels per day. This has basically meaning a net loss of only 6.2 million barrels per day. What we're later going to look at, and we might jump at it straight away, if we move to slide 11, is that even with this effective closure of Hormuz, we have had so large changes in trading patterns that we're actually back to oil traveling over distances, oil on water, pre the Hormuz closure. The long-haul trade has outgrown the loss of the relatively short-haul trade from the Middle East Gulf to Far East. We've also seen export capacity that we actually didn't know existed, or at least we didn't really focus on it, adding to this volume. We've seen Asia increase their sourcing from virtually all available regions, all of them further afar, fueling this ton mile and this high utilization. Despite the volume shortfall then, adjusted for distances, shipping demand is surprisingly robust. Crude on water is recovering fast, and this is important to note. When you look at a real-time picture, you will not record this until after the fact. It takes 30-45 days from a barrel is contracted to be freighted before the oil is actually loaded on a ship. This means that it's only in the last three, four weeks we've seen this material happen, using the data or using the oil on water data. I have to say, though, we might actually flip back to slide nine, because this is important. On this chart, you'll see in the middle on the top right-hand side there, the number + 55. These are vessels that are contracted or majorly contracted to players that are not necessarily having the same economic rationale that then we as a ship owner would have. These are vessels that do the baseline of oil transportation from the Middle East Gulf to Asia. They're contracted to industrial players like refiners and oil majors. For these guys to not have vessels available should the strait open, can be an extremely costly affair. These ships are contracted out on modest rates. You're talking five year deals, six year or seven or 10-year deals, between $35,000 and $45,000 per day. Meaning that's the option premium they pay in order to be able to lift first oil as it comes. For them, this is logistics. It's not necessarily profit, different from Frontline. Of course, hadn't we had this kind of idle fleet, I think the supply and demand picture would have looked a bit different on tankers and especially VLCC. That's the case, that's the way it is, right now, we're reaping the benefits of the fact that a relatively large portion of the fleet is unutilized, waiting for something to happen in the Middle East. Let's jump forward again and get into slide number 12. I mentioned that the order books continue to grow. We're starting to get into a kind of territory, where you have kind of percentage numbers that start with a three, but still, we have this aging of the fleet that is ongoing. If you look at the table on the top left-hand side, the vessels that are currently 15 years or younger, they are going to be 20 years within five years, and that amounts to 45.5% of the current fleet. If you put that in the back of your head and you look at the order book, which for the asset classes we deploy is around 23.2%, it doesn't look too alarming. The period that the current order book is delivering over is the next three to four years, where kind of the bulk of the vessels for especially VLCC and Suezmax are actually coming in 2028. With this in mind, I'm not saying that the order book is non-existent, but I'm saying that the order book is manageable. I think it's important to note when we look at these charts that the likely outcome or the likely kind of points on the list, if there is a peace solution between U.S. and Iran, is going to include sanctions on Iranian oil. This means that the current part of the fleet that is now servicing the Iranian crude is going to be obsolete, and that amounts to 15%-17% of the overall VLCC fleet which overnight are going to become useless. We can move to slide 13 and dig a little bit further into this argument. We have very strong spot and period markets in addition to the fundamental backdrop which I just pointed on, and this keeps ordering activity high despite the current opaque situation in the Middle East. Tanker ordering is accelerating for 2029 and we are starting to see slots move into the 2030 window, increasing the runway. We're talking about three years, three and a half years until a new hull can be added to this order book. With the absence of recycling but the continuous aging of the fleet, the net compliant fleet growth is still manageable where we are now. Mind you, again, we do not see vessels over 20 years being deployed in any markets despite extremely constructive rates. As I mentioned, the likely end game of Middle East conflict implies reversal of Iran sanctions adding to the demand for compliant tonnage and potentially triggering the very kind of sought-after wave of recycling. One kind of larger fundamental piece in this picture is that the number of shipyards is still materially lower than what we saw in the 2010-2011 peak. The consolidation and more recently efficiency gains put the TCE capacity closer to highs. I'm almost saying this that basically to explain how even though the building capacity and the capacity to basically have new tonnage into the market to service future oil transportation demand seems limited, we are actually in a place where we are going to be able to maintain a fleet that can service oil markets for many years to come. The top right-hand side chart shows us basically how the kind of overall net fleet development is looking right now, and it's not alarming by any means. Let's move into slide 14. I think I'll just start so that we can look at the bottom hand slide, bottom hand chart, because we use that for quite a few quarters now. Mind you, the orange thing at the end there. I mentioned that we at Frontline has not had a quarter like this since 2004. Look at where we are now year to date in 2026. It's quite extraordinary. Yes, there is a certain portion of this index that is colored by the fact that we have some of the trades that cannot be performed that are being printed at extremely high levels, but still, we are in unprecedented times. Fundamentally, tight market conditions and they were present prior to the Middle East disruptions. The disruption in trade lanes has yielded inefficiency and new trades and longer trade lanes have been developing. We believe this can be a bit sticky, basically due to the energy security part of this. We have continuous muted growth in the compliant tanker fleet. That is still at the core of the case of holding tanker stocks. Asset prices continue to move. Both spot and period markets support investment decisions as we move forward here. The current political environment changes the game. I repeat myself, we will see a higher focus on energy supply security going forward. Frontline is in center stage with our VLCC-heavy efficient business model as hopefully positive outcomes mix. Thank you very much for the attention. Then I'll open up for questions. Thank you. To ask a question, you will need to press star one then one on your telephone and wait for your name to be announced. To withdraw your question, please press star one then one again. One moment for our first question. This question comes from the line of Sherif Elmaghrabi from BTIG. Please go ahead. Hi. Thanks, good afternoon. First, starting with the fixture count. When I look at VLCC fixtures, I see activity out of the U.S. Gulf West Africa declining slightly from April to May, even though rates have remained very strong. I'm curious if you're seeing the same thing and if you have idea of what's going on with fixture activity. Well, this market has moved into very much a stealth mode. It's of course not everything that is seen. I think from a utilization perspective, if you are a oil trader, you always utilize your own fleet first. This means that those are issues that will not be reported in the market, although the volume might remain the same. Secondly, we've seen that the fixing happening out of the U.S. Gulf has been extremely meaning cyclical. It starts with the short-term barrels being fixed on Aframaxes, which we've seen recently. Suddenly it tracks into Suezmaxes bringing the oil to Europe, until suddenly you see dates being confirmed for oil moving into the Far East, which brings the VLCC into the game. Suddenly the VLCC fade, the Suezmax fade, we're back on the Aframaxes again. It just repeats itself. It seems like the U.S. Gulf fixtures on the VLCC side happens on a monthly cycle, and it only happens within a week and a half in that month. I think it's quite difficult to read from fixtures, first of all, because it's very difficult to see all of them, and secondly, because you have this little bit untypical pattern. You don't have a continuous flow of VLCCs being fixed or a continuous flow of Suezmaxes or continuous flow of Aframaxes. It basically depends a little bit on the prices of crude and how the arbs are opening or closing. Of course, with extreme volatile narrative, virtually every Friday, we're about to open Hormuz, and every Monday it's closed again. This makes this a very difficult playground for even the traders. Yeah, I definitely get whiplash from the headlines. Sticking with the idea of captive fleets, the presentation mentions 55 VLCCs on standby outside the Arabian Gulf. Do you have a thought on why the NOCs, I'm assuming they're NOCs, might do that rather than participate in alternative trades for the time being? No, I think it's, obviously I don't know this, but a likely theory is that in the event of an opening, say, somebody tweets and a press release is coming out tomorrow saying that now it's all okay, we can travel through. The first vessel that goes through can potentially buy Iraqi oil with a $30 discount to Dubai or Brent. That's $60 million right there. I think that's the motivation. Having the ability to be able to move quickly to take the first barrels, as opposed to having to call Frontline and ask us for a rate. That has huge value. The alternative is that if they went in to compete with, say, us in Atlantic market, that vessel would be gone for 70-90 days, and then they really have to call us if they need freight out of the Middle East Gulf quickly. I think, I would assume that's the analysis behind this. Since the cost on holding these vessels, it's not like a current market cost. It's a time charter contract that was agreed years ago. I think the cost to keeping that option is manageable. Of course, what happens tomorrow is impossible to say. Great call as always. Thank you, Lars. Thank you. Thank you. Our next question comes from the line of Jon Chappell from Evercore ISI. Please go ahead. Close enough. Good afternoon, Lars Barstad and Inger Klemp. Lars Barstad, the slides nine through 11 are really fantastic. Ton of detail, super interesting. Haven't seen it laid out this way before. My question is, if the impact from the fleet on slide nine is only 11 VLCCs, and then 10 and 11 net themselves out, like you said, the loss of volume is obviously negative, but the ton mile impact is almost a complete offset. It feels like the utilization then overall should be relatively balanced to before the strait closed, yet rates have obviously been incredibly strong. You have the theoretical ones, but then you also have the real ones as well. What's the differentiating factor that takes what looks to be a balanced outcome versus three months ago and has put rates into the stratosphere. I think, again, the biggest X factor, we didn't see this coming at all, was the amount of vessels that seemingly for It's not like obvious economical reasons sit unutilized. I think that the ton miles do amount to a lot. I think people are surprised by the amount of volume Saudi has been able to ramp up the Yanbu loads with. I don't think you can get away from the fact that we have this uneconomical, for different reasons, part of the fleet that remains unutilized is the biggest factor in here. Even we did not believe that what's happened or transpired over since 28th of February could be bullish VLCC or all neutral to VLCC. Okay. You spoke on slide 13 about the likely end game. I think that most people would agree with you that that's most likely, certainly the stock market acts that way. Frontline has always been positioned, obviously, to maximize spot market exposure. If we were to consider the other end game, which is continued and escalated hostilities and maybe a more permanent closure of that waterway, how do you think about how you manage risk in that outcome? Again, I know we have to lean towards the likely outcome and what the market's telling you and the Friday afternoon tweets. Have you thought about managing the fleet or even the balance sheet in a different manner just in case that unlikely tail risk emerges from this unprecedented time? Yes, we have. I think although we've done some more time charter coverage, particularly so on the VLCC during Q1 and also continuing. I think the first iteration of that was basically we looked at unprecedented market prior to the Hormuz closing. Of course we didn't know that was going to happen. What happened in the aftermath is that we've actually continued to secure short-term coverage, like one year coverage on the VLCCs to the point where, and Inger has a table in there. We're closing on 30% of our voyage dates for VLCC for the next 12 months or thereabout, or at least for the first couple of quarters being covered by time charter contracts. We've always communicated this, that our proposition to you as investors is to try and give you a spot exposure. Of course, at certain points in the curve, we'll try to cover, and that's of course to try and prevent ourselves from going bankrupt should we be wrong. I think that is the answer to your question. We could be all spots at this point in time, but we are actually very close to 30% of our voyage dates on VLCC, which is the most exposed segment we believe, for a long-term closure, in case nothing is sold there. Yeah, that's great. All right. Thank you, Lars. Really helpful. Thanks, all. Thank you. As a reminder, to ask a question, you will need to press star one and one on your telephone. That is star one and one to ask a question. We are now going to take our next question. This one comes from the line of Deven Sangoi from Tej Investments. Please go ahead. Hi, Lars. I just want to ask you two questions. First one is that we've seen a lot of countries have used the reserves, crude reserves what they had because of the disruption. If they have to go back to the previous results, previous to this war and [ianudible], how the demand will shape up even if the war is over? Well, if I got your question correctly, you're asking basically how will this market look when it normalizes, right? Yeah. Yes. Yeah. In our world, and of course we lean on analyst that actually knows this properly, I don't think we'll see Middle East exports resume to levels prior to the closure anytime soon. I think that will take time. You will have an initial flow of oil coming out. First of all, the vessels that are already laden. Secondly, barrels that sit in tanks inside the Gulf currently, and then new production is going to be coming on. For some of the exporters, this is, of course, a liquidity thing. They want to get as much oil into the market sold and get some cash as soon as possible. At the same time, we will also have this, what we believe, high probability of Iranian crude also being a compliant crude when this happens. Mind you, that that's 1.5 million to two million barrels there as well coming from Iran that needs compliant tonnage. As we move forward here, I think if I was a refinery in the Asia or a short oil entity in Asia, the minute I filled up my inventories, I would start to basically spread my risk on how I procure oil going forward. I think that could create a more long-term situation where we see these longer old school ton miles become more and more stable as we proceed. The opening scenario, I think it's very difficult to paint a bleak picture for tankers. There could also be the possibility to paint a quite bullish picture for oil price, basically, because you need all this inventory build. You will not get production back overnight, and there will be a bit of a shortness on oil as well going forward. I think the point that we cannot get away from is that this whole situation, which has now lasted for 12 weeks or whatever, if I'm counting, is also a huge push for energy diversification by way of looking at other energy sources like nuclear, wind, gas, what have you. Maybe not gas, but at least solar, though. This is actually a push towards long-term energy transition. I think that's five years out. It's not something that we need to think about right now. I think the short-term scenario is how I described it. Lars, the other thing is that India contracted today from Venezuela, and after this war is over, the 20%, which is a huge dependence of a lot of countries, especially India, China, which is now taking it from Middle East, they would like to diversify. Does that permanently change the ton mile demand and the ton mile travel for the ships, especially the large ones? Yeah, I believe so, and I think this is also the root cause for some of the interest we're seeing from these Asian industrial players, that they actually are trying to access the term charter market, taking ships for delivery in 2027, 2028, and 2029. I think that's the long game in this, that they are there to try and commit themselves for oil supply contracts from Latin America, West Africa, and U.S., and then basically need to secure tonnage against those contracts. Does it mean till FY 2029, calendar year 2029, you're going to have a very strong or a stable high rate scenario for this ship? I think that's impossible to say, to be quite honest. We see that the freight markets and the period markets are backdated. A one year contract for a vessel delivering fairly soon is around $120,000 per day. The minute you do a two year contract, you talk about $90,000, three year contract, $75,000, $76,000. If you go out and do a five year deal for delivery 2029, you're down in the $40s. Okay. Yeah. Thanks a lot, Lars. All the best. Thank you. Thank you. There are no further questions for today. I will now hand the call back to Mr. Lars Barstad for closing remarks. Yeah. Again, thank you very much for listening in. It's quite a hectic political landscape we're working under. Rest assured, Frontline are focused on trying to collect cash as we proceed here, and it looks pretty okay for now. Thank you. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.