Before we get started with today's call, I would like to make the following remarks. A replay of this conference call will be available at our website, dhtankers.com, through May 16, 2017. In addition, our earnings press release will be available on our website and on SEC's EDGAR system as an exhibit to our Form 6-K. As a reminder, on this conference call, we will discuss matters that are forward-looking in nature. These forward-looking statements are based on our current expectations about future events, including DHT's prospects, dividends, share repurchases and debt repayment; the outlook for the tanker markets in general; daily charter hire rates and vessel utilization; forecast of world economic activity; oil prices and oil trading patterns; anticipated levels of newbuilding and scrapping and projected dry dock schedules. Actual results may differ materially from expectations reflected in these forward-looking statements. We urge you to read our periodic reports available on our website and on the SEC's EDGAR system, including the risk factors in these reports, for more information regarding risks that we face. I'm joined today by DHT's co-CEOs, Svein Moxnes Harfjeld, and Trygve Munthe. And with that, I'll turn the call over to Svein.

Thank you, Eirik. Good morning and good afternoon and thank you for joining the DHT first quarter 2017 earnings call. During the call, we will go through our operational and financial highlights, capital allocation, cash and P&L breakeven as well as commentary on the BW transaction and Frontline's pursuit of DHT. Let me start by saying that during our first quarter, we were pleased to achieve strong operational results and to continue to execute our strategy of disciplined countercyclical growth. We are proactively managing the cyclical market environment through a balanced approach to fleet building, operations, costs and capital allocation. Our well-defined strategy is serving us well through both peak and trough periods, and we are confident that it will continue to do so going forward. To that end, the asset values are at their lowest point since 2013, and as earlier stated, we believe that 2017 will be a year right for expansion. We have already capitalized in this first quarter with acquisition of BW's VLCC fleet, which we'll go into in more detail later in this call. We have also continued to deliver significant value to shareholders by returning capital whilst maintaining a strong balance sheet. We have made important progress this quarter and look forward to continuing to build on our momentum as we move through the rest of the year. Turning now to our first quarter highlights. We delivered a solid quarter with EBITDA of $50.6 million. Our spot earnings came in at $40,900 per day, a respectable number in our opinion. We continued our quality operations with excellent approvals of our ships by our customers, insignificant off hire and very competitive OpEx. Adjusting for the loss of the sales of DHT Phoenix and DHT Ann, our first quarter performance translated into $21.8 million in net…

Thank you, Svein. Let's talk about cash breakeven. As you've come to know, we at DHT are keenly focused on cash breakeven. And as we've highlighted before, when we talk about cash breakeven, we include all expected cash costs. Today, I'll focus on just two numbers. For DHT to go cash neutral in the second half of this year, we estimate that the spot VLCCs must earn $18,100 per day. For next year, the corresponding number is $20,400 per day. Very competitive and comfortable numbers in our own opinion. Cash breakeven is all about staying power and downside protection. So let us now switch gear and look to the upside. On this slide, we show the required rates needed for DHT to produce positive net income. So the main takeaway here is we will be profitable at VLCC spot rates in excess of $22,500 per day for the second half of 2017 and at $24,800 per day for 2018. And as you will recall, our capital allocation policy is to return minimum 60% of net income to shareholders. Let me then take a moment to address Frontline. As you know, over the past several months, we have made a number of proposals to acquire DHT. In fact, the last proposal they made on April 25 was unchanged from a previous proposal that our board had already rejected. We have attempted to engage in good faith with Frontline during multiple in-person and phone meetings to reach a starting point for a productive discussion. We explained that their proposals do not reflect the fundamental value inherent in our fleet and would in fact dilute the value of DHT shareholders' investments. Please allow me to be a bit specific. First, through our acquisition of the BW ships, we established DHT's NAV to $5.37…

[Operator Instructions] We will now take the first question from Jon Chappell from Evercore. Please go ahead.

Trygve, you just mentioned the -- just briefly, 4 VLCCs of BW had placed an order for, post the announcement of your acquisition or your merger. Can you just explain to us what the terms are as far as how those ships relate to DHT, rights of first refusal, any specific time frames where deposits would have to be placed, how do think about those four ships as the overall entity?

We have an agreement with BW that we will commercially manage these ships. So they will be under the DHT wings, but ownership remains with BW.

And that's in perpetuity. There's no purchase options or any chance of you getting ownership of those?

To the first part of your question, there is no purchase option. But that's not to say that it will never ever change hands. But we do not have first right of refusal or an option at fixed numbers or anything like that.

Okay. And then as it relates to the opportunities in liquidity, that's a pretty good financing terms you got for your own two VLCCs plus the BW transaction. What would you consider your current liquidity to be today to be opportunistic in the market? And then second of all, we're seeing kind of a little bit of strengthening in some recent transactions. I'm just wondering if that is the beginning of the signs of an inflection point. Or do you think that the market continues to kind of bounce along the bottom over the next several months, providing a window still for you to move forward?

I think that over the past several quarters and months, most analysts have been too bearish on the whole sector. They've been right that values have been coming off quite significantly. But the freight market has held up very nicely. And I think that's what's starting to dawn upon people that 2017 that most people thought was going to be a very depressed market, has at least started out quite respectively. And then people recognize that values are down to trough levels from the last trough. So maybe there are some embedded opportunities here, and we wholeheartedly agree with you, Jon, that there is signs suggesting that there is more buying interest out there. And I guess, there are some data points that are coming in just the last couple of days suggesting that the move seems to be upwards from where we are.

So in that vein then, window may be closing. I mean, obviously it's difficult to bottom tick, and they're still low by any recent standards. But to be able to move quickly, what would you say your available liquidity is today for further acquisitions?

I think this is going to echo what we responded last time that with the balance sheet we have today, we can do single ship acquisitions and the likes, but we cannot go out and do fleet acquisitions without issuing additional raised capital. So we think we're very comfortable, very strong with the fleet that we have. And quite frankly, we've taken the -- we've just taken a pretty big step in the -- on the expansion side. We couldn't repeat that again without raising equity, for sure.

Thank you. We will now take the next question from Spiro Dounis from UBS. Please go ahead.

Just kind of want to follow up on the growth side of things here. Just as you think about the next dollar you spend on growth, you've obviously bought some second-hand assets, you've also bought some newbuildings. I guess, you just gave a preference where you spend from valuation perspective on what looks more attractive. And when you think about obviously, very large VLCC player now diversifying away from that, are there other tanker sectors you think you'd look at here?

The liquidity in general is rather painful for second-hand ships. And for us, the focus is really value. Obviously, in January, we felt that newbuildings was the way to go. We got those two orders placed at very effective terms. The BW transaction was based on the prevailing broker values towards the end of March, so also at values that we think are good. We are a tanker company, and we have a couple of Afras. We used to have Suezmaxes. So we will not preclude from being involved in those sectors. But I think it's fair to say that our focus is very much on the VLCC space. And that's where we think the better economics are. We are still bullish on the long-haul transportation needs. And that's really also where the VLCCs will be the workhorses.

Got it. Okay, that's clear. And you mentioned those two Aframaxes that you have. I think those recently came off chart, or I believe you were looking to be maybe extend those, I think, was the ideal outcome. Just curious where do those stand right now?

We don't really think that this is the market to enter into long-term charters. So we are operating them on shorter-term charters. So we are operating them on shorter-term charters for now and continue to do that until we think it's the right time to entertain longer-term income. Alternatively also, sell them at some point, but we are in no rush to do that. These are two quality ships, very attractive design. So they will stay with us for a while longer.

Thank you. We will now take the next question from Herman Hildan from Clarkson Plateau. Please go ahead.

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I'm not sure we understood that question, Herman. If you can rephrase and repeat?

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As you noted, we expanded our board by one additional director recently, and that is the BW Group representative, Carsten Mortensen. And the most recent Frontline proposal was considered over some time by the board, including BW's director. And the response that was sent on Sunday to Frontline was unanimous agreement by our board in response to Frontline.

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As far as we noted, Paddy is the last one to order, at least for today.

I think it's recognized that early this year, end of last year, there are kind of hungry for new business. And the big [indiscernible], they had a rather aggressive marketing campaign early this year. And they made some, call it, sweet deals for some long-term customers, us included. But they have recently really cooled that off and are increasing their prices. So there is appreciating trend, so to speak, on the cost of ordering a newbuilding. I think also people should take note of who are ordering. There is some highly respected private companies and that's been in this new game for a long time that they place each ship to orders for two or four ships. And they think this is really a good time to invest. And it seems to us that most of these guys that you would call the usual suspects for such activity have now made it almost to the business. So we don't think this is, call it, a linear trend. You'll the same activity through the rest of the year. So I think it's going to quiet down a bit.

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Yes, that's correct.

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Thank you. We will now take the next question from Fotis Giannakoulis from Morgan Stanley. Please go ahead.

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As I think, as we highlighted on the BW transaction, by increasing our VLCC fleet from 20 to 30, of course, capacity increases dramatically, but we only have to add a limited number of people on our shoreside staff. So there's definitely cost synergies in that expansion that we did. And similarly, when we acquired Samco three years ago, we also realized cost synergies. So I think in most business combinations, there will be some cost synergies. But of course, as you get larger, it becomes perhaps a bit more marginal. So that is the general observation. And I think you see what the Frontline's viewpoint is that there there's been no recognition of our very fundamental objections to their proposal, namely that our NAV contribution and our EBITDA contribution suggested far better exchange ratio than what they proposed. So that's really the stumbling block. It's not about synergy on the cost side.

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We're not going to stand in way for a business combination that make sense for our shareholders of both sides, but it needs to be fair balance and it needs to make sense to both sides. And so far, they have failed to recognize the importance of that.

I want to go to the newbuilding front. We have seen a number of newbuilds this year. I understand that you believe that there are not going to be not many. But I was wondering, based on your supply-demand estimates based on whether you see trade developing and the certain scenarios that you have in your mind, how many new buildings that we need in order to the replace the existing vessels that are above a certain age and that have come to scrapping and to certain additional demand that is going to come from incremental oil supply?

-: And we have an OPEC just then closing the taps, as you've seen recently, then all these refineries in Asia turning their focus to the Atlantic. And this is adding on to transportation. And I think they are not willing to rely entirely on OPEC as well. They want to diversify their supply base. And you see that all along where they enter into long-term supply agreements or they invest in hydrocarbons to secure supply and all of that. So we think this picture looks pretty good. If you look at China, in particular, you would expect China over the next four years to add some 4 million barrels a day of refining capacity. And although the bulk of that looks to come in '19 and '20, there's a steady expansion. And that combined with their dwindling domestic oil production, it's also set for healthy demand for our services. So through our actions, I think you can say that in the medium term, we are quite bullish.

Can you also comment about concerns that there are about the increasing U.S. production, particularly the Permian? And how does this impact the demand picture for VLCCs? If OPEC extends the cut for much longer than expected and we go through 2018 with OPEC having reduced production, what will be the consequences for your supply-demand outlook, especially given the increase of very recent newbuilding orders?

I think your first part there on the increase in domestic production in United States, this of course now is quite different than two years ago, because now you're allowed to export. And so far, only indicators are that the incremental production is going to lead U.S. exports, which is a new thing. And I think, again, it has proven the so-called experts wrong, because this crude is really finding new homes all over the world. It's not only to Europe that most people are pointing to before they are starting to develop. So it's interesting. OPEC is cutting back, but this main supplier than being in the Atlantic Basin and they are adding two months as we speak. It seems that the U.S. producers are both able and willing to be competitive.

Thank you. We will now take the next question from Rob Silvera from R.E. Silvera & Associates Marine Surveyors.

First of all, I'd like to complement you on doing a great job in this last quarter, especially when you're dealing with all the distractions of Frontline. Obviously, Frontline sees great value in you because of what their approach was and what they were trying to get for a very insignificant price as far as I'm concerned, and so did BW. As you pointed out, BW did a deal with you based on hard assets for ownership of your stock, money and ships and value very fairly at $5.37, as you said. I would like to comment as a group that holds over 58,000 shares of DHT that if this deal were to go through even at a premium to where it is today based on 100% stock, as soon as it's done, the value is subject to change. Dilution could make that change a big change, especially to the downside. So we can never really know in advance just what value we would be getting when it's 100% stock-based. You'd have to hedge and a lot of people don't know how to do those kind of things. Anyhow, another issue, and I think this one looks to the future of a merger type of structure. And that is the debt management history for Frontline. And its management is what I would consider terrible witness, not only the earlier Frontline and what it went through, but also Seadrill, which has become virtually a penny stock. So in my opinion, even if they increase the offer of stock and try to continue with a merger and control, my answer would be an emphatic no, and I hope you guys will stick to that. I like what you've done. I'm very proud of what you've done. And I recommended you to many friends. So that's my input I don't have any real specific questions. I just am commenting really this time around as a over 58,000 shareholder.

Thank you, sir. We appreciate your viewpoints. And I think actually you speak for a lot more than 58,000 shares in order to just voice. So thank you very much.

We have also a lot of incoming calls on the same matter, and we experienced strong support from investors, in United States in particular, for our efforts. So thank you very much for your encouragement.

Thank you. We will now take the next question from Michael Webber from Wells Fargo. Please go ahead.

That endorsement will be a tough to follow, but just a couple of questions. And I don't want to oversimplify things here, but it's a little bit unclear as to whether, I guess, in the most recent volley of offers and rebuttals with Frontline, have you guys been able to actually have a direct dialogue with them, either in person or on the phone, kind of beyond what we would see via letters in either direction?

In the past, we have met with Frontline management several times and also spoke with them over the phone several times. So there's been a number of engagements, so to speak.

And in the past, would that be within, say, 2017?

Yes. And also in '16.

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Repeating what we just said that with the total disregard for the underlying inherent value in the DHT fleet and our EBITDA contribution and what appears to be a Frontline so focused on market cap in developing the exchange offer. It's a dead-end street. We're not going to get anywhere with that. So we think that yes, they have a premium and we hear that people are arguing there's reasons why they are on their premium. But if we were to accept the premium currency, we only get the downside for having a premium. We don't get any upside. So I think that's an important factor as well.

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We're not going to comment specifically on that point. I think you'd appreciate that.

Thank you. We will now take the next question from Noah Parquette from JPMorgan. Please go ahead.

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Thank you. [Operator Instructions] We will now take the next question from James Jang from Maxim Group.

James?

A question. You guys sold the DHT Ann [indiscernible]. Are you guys possible looking to sell those vessels once the new vessels are deliver? Or are you comfortable carrying...

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And you guys mentioned the aggressive marketing by the Korean yards in the beginning of the year. I don't know how much contact you have with the yards. But have you seen that aggressive pricing continue or are they pulling back some now?

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There are no further questions in the queue at this time.

Okay. Then it remains for us just to say thank you to everybody for continued support of DHT and your interest in our earnings for the first quarter 2017. Thank you very much.