Shares of Norway's Frontline Ltd. (NYSE: FRO), the world's largest independent operator of oil tankers, leaked more than 40 percent following a dismal earnings report issued before U.S. markets opened Tuesday. Frontline reported a net loss of $44.7 million for the third quarter of 2011, or $0.57 per share, and a net loss of 64.5 million for the 9-month period ending Sep. 30, 2011, or $0.83 per share. Details of the losses were outlined in a press release issued by the company.
Frontline's outlook for the future of their business and that of the entire oil tanker industry was no less bleak.
"The tanker market has shown a strong negative development in the last two years," the company said in a media release. "If the weak market continues it is likely to lead to significant financial problems for the whole tanker industry."
Frontline said it would be looking at a number of financial restructuring options with the goal being to "get relief in the Company's financial covenants and debt repayments."
According to Reuters, Frontline Limited will have to do more than restructure current debts, needing to raise as much as $350 million in cash to keep the company operational.
Based in Bermuda, Frontline owns a fleet of very large crude carriers (VLCCs) and Suezmax tankers that transport oil globally between ports, according to their website.
Frontline Ltd. was trading at $3.13 per share just before noon Tuesday on more than double average trading volume. The price represents a significant decline from Monday's closing price of $5.19 per share.