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Flex LNG Ltd. (“Flex LNG” or the “Company”) today announced its unaudited
financial results for the nine months ended September 30, 2022.
Highlights:
? Vessel operating revenues of $91.3 million for the third quarter 2022,
compared to $84.2 million for the second quarter 2022.
? Net income of $46.6 million and basic earnings per share of $0.88 for the
third quarter 2022, compared to net income of $44.3 million and basic earnings
per share of $0.83 for the second quarter 2022.
? Average Time Charter Equivalent (“TCE”) rate of $75,941 per day for the third
quarter 2022, compared to $70,707 per day for the second quarter 2022.
? Adjusted EBITDA(1) of $70.9 million for the third quarter 2022, compared to
$66.1 million for the second quarter 2022.
? Adjusted net income(1) of $42.2 million for the third quarter 2022, compared
to $31.6 million for the second quarter 2022.
? Adjusted basic and diluted earnings per share(1) of $0.79 for the third
quarter 2022, compared to $0.60 for the second quarter 2022.
? In September 2022, the Company signed a $150 million term loan facility for
the financing of Flex Enterprise.
? In November 2022, the Company received a credit approved term sheet for a $150
million term loan facility for the re-financing of Flex Resolute.
? In November 2022, the Company received a credit approved term sheets for a
$330 million sale and leaseback agreement for the re-financing of Flex Amber and
Flex Artemis.
? As per date of this report, the Company has SOFR and LIBOR based interest rate
swaps with aggregate notional principals of $381 million and $260 million
respectively. The weighted average SOFR interest rate is 1.32% with weighted
average duration of 5.3 years. Whilst the weighted average LIBOR interest rate
is 1.11% with a weighted average duration of 2.6 years.
? The Company declared a dividend for the third quarter 2022 of $0.75 per share.
Øystein M Kalleklev, CEO of Flex LNG Management AS, commented:
"During the third quarter, Flex Enterprise and Flex Amber commenced their new
seven-year Time Charters agreed in June 2022. Additionally, Flex Aurora was
delivered to Cheniere as the fifth and last ship under the agreement announced
in April 2021. Hence, Flex LNG today have 12 LNG carriers on fixed hire Time
Charters and one ship, Flex Artemis, on a variable time charter. Our first fully
open ship, after charterer’s options, is in the middle of 2026 with three other
ships coming open in 2027. Today, with 2027 the earliest newbuilding delivery
window and newbuilding prices at around $250 million, we are therefore upbeat
about the prospects of re-contracting our ships at attractive levels thereby
adding further backlog to the Company.
For the third quarter, Revenues came in at $91 million in line with previous
guidance of approximately $90 million. Net income came in at a healthy $47
million equivalent to $0.88 per share. For the first nine months of 2022, total
Net income is $147 million, fuelled by $75 million gains on interest rate
derivatives, as we have been ahead of the curve locking in long term interest
rates at very attractive levels before Federal Reserve started to hike rates.
Adjusted Net income, whereby unrealized gains on derivatives and non-recurring
items are eliminated came in at $42 million equivalent to $0.79 per share for
the quarter.
Following the completion of Balance Sheet Optimization Phase 1 in July where we
raised $137 million of fresh cash by refinancing six of our ships, we announced
Phase 2 of our Balance Sheet Optimization Program. Under Phase 2 we will
optimize financing for the remaining seven ships in the fleet with the aim of
increasing our cash position by a further $100m while at the same time improving
our overall financing terms. We have now secured refinancing for four of the
seven ships with net proceeds of $110 million. We are thus already ahead of the
$100 million target, and we expect the cash release to grow further as we are
also making good progress on the refinancing of the remaining three ships. In
total, we now expect that the Balance Sheet Optimization Program will at least
release $300 million in cash. Our cash position is already at a healthy $271
million at quarter end thus we expect this number to move upward as we are
completing these refinancings.
Given the strong freight market, our extensive contract backlog and our super
strong financial position we are therefore today pleased to declare an ordinary
quarterly dividend of $0.75 per share which should provide our shareholders with
an attractive yield of approximately 10 per cent."
Third Quarter 2022 Result Presentation
Flex LNG will release its financial results for the third quarter 2022 on
Tuesday November 15, 2022.
In connection with the earnings release, a video webcast will be held at 3:00
p.m. CET (9:00 a.m. EST). In order to attend the webcast use the following link:
events.webcast.no/viewer-registration/AFsFIAbO/register
(Registration • Third Quarter 2022 Earnings Presentation)
A Q&A session will be held after the conference/webcast. Information on how to
submit questions will be given at the beginning of the session.
In conjunction with the quarterly results, we have published a short video in
which Øystein Kalleklev, CEO of Flex LNG, discusses the highlights of the third
quarter. The video can be accessed through the following link:
youtu.be/tsU0jebpux0 (https://youtu.be/tsU0jebpux0)
The presentation material which will be used in the conference/webcast can be
downloaded on www.flexlng.com and replay details will also be available at this
website.
For further information, please contact:
Mr. Knut Traaholt, Chief Financial Officer of Flex LNG Management AS
Telephone: +47 23 11 40 00
Email: ir@flexlng.com (mailto:ir@flexlng.com)
This information is subject to the disclosure requirements pursuant to Section
5-12 the Norwegian Securities Trading Act.
Forward-Looking Statements
Matters discussed in this press release 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. The Company
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,”
“expect,” “forecast,” “anticipate,” “estimate,” “intend,” “plan,” “possible,”
“potential,” “pending,” “target,” “project,” “likely,” “may,” “will,” “would,”
“should,” “could” and similar expressions identify forward-looking statements.
The forward-looking statements in this press release 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 the Company’s records and other data available from
third parties. Although management 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 the Company’s control, there can be no assurance that the
Company will achieve or accomplish these expectations, beliefs or projections.
As such, these forward-looking statements are not guarantees of the Company’s
future performance, and actual results and future developments may vary
materially from those projected in the forward-looking statements. The Company
undertakes no obligation, and specifically declines any obligation, except as
required by applicable law or regulation, to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise. New factors emerge from time to time, and it is not
possible for the Company to predict all of these factors. Further, the Company
cannot assess the effect of each such factor on our business or the extent to
which any factor, or combination of factors, may cause actual results to be
materially different from those contained in any forward-looking statement.
In addition to these important factors, other important factors that, in the
Company’s view, could cause actual results to differ materially from those
discussed in the forward-looking statements include: unforeseen liabilities,
future capital expenditures, the strength of world economies and currencies,
general market conditions, including fluctuations in charter rates and vessel
values, changes in demand in the LNG tanker market, the impact of public health
threats and outbreaks of other highly communicable diseases, including the
length and severity of the COVID-19 outbreak and its impact on the LNG tanker
market, changes in the Company’s operating expenses, including bunker prices,
dry-docking and insurance costs, the fuel efficiency of the Company’s vessels,
the market for the Company’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 the Company, changes in
governmental rules and regulations or actions taken by regulatory authorities,
including those that may limit the commercial useful lives of LNG tankers,
customers’ increasing emphasis on environmental and safety concerns, potential
liability from pending or future litigation, general domestic and international
political conditions or events, including the recent conflict between Russia and
Ukraine, business disruptions, including supply chain disruption and congestion,
due to natural or other disasters or otherwise, potential physical disruption of
shipping routes due to accidents, climate-related incidents, or political
events, vessel breakdowns and instances of off-hire, and other factors,
including those that may be described from time to time in the reports and other
documents that the Company files with or furnishes to the U.S. Securities and
Exchange Commission (“Other Reports”). For a more complete discussion of certain
of these and other risks and uncertainties associated with the Company, please
refer to the Other Reports.
(1) Time Charter Equivalent rate, Adjusted EBITDA, Adjusted net income/(loss)
and Adjusted earnings/(loss) per share are non-GAAP measures. A reconciliation
to the most directly comparable GAAP measure is included in the end of this
earnings report.
Kilde
