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Hamilton, Bermuda
Flex LNG Ltd. (âFlex LNGâ or the âCompanyâ) today announced its unaudited
financial results for the six months ended June 30, 2024.
Highlights:
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Vessel operating revenues of $84.7 million for the second quarter 2024,
compared to $90.2 million for the first quarter 2024.
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Net income of $21.8 million and basic earnings per share of $0.41 for the
second quarter 2024, compared to net income of $33.2 million and basic earnings
per share of $0.62 for the first quarter 2024.
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Average Time Charter Equivalent (âTCEâ) rate of $72,385 per day for the second
quarter 2024, compared to $76,539 per day for the first quarter 2024.
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Adjusted EBITDA of $63.2 million for the second quarter 2024, compared to
$70.6 million for the first quarter 2024.
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Adjusted net income of $30.4 million for the second quarter 2024, compared to
$37.9 million for the first quarter 2024.
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Adjusted basic earnings per share of $0.56 for the second quarter 2024,
compared to $0.70 for the first quarter 2024.
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In April 2024 and May 2024, we successfully completed our scheduled drydocking
for Flex Constellation and Flex Courageous, respectively, on-time and on-budget.
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In April 2024, the charterer of Flex Endeavour exercised an option to extend
the time charter by 500 days from the Q3 2030 to Q1 2032.
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In May 2024, Flex Constellation commenced a time charter with a large Asian
utility and asset backed LNG trader. The charter has a firm period ending at the
end of Q1 2025 and the charterer has the option to extend by an additional one
year to the end of Q1 2026.
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In July 2024, we received credit-approved term sheets for a six-year $270
million term and revolving credit facility. The refinancing will repay the full
amount outstanding under the existing tranches of the $375 Million Facility, in
respect of Flex Aurora and Flex Ranger.
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In July 2024, we also received credit-approved term sheets for a $160 million,
ten-year sale and leaseback with an Asian-based lease provider for Flex
Endeavour. Following the refinancing, the $375 Million Facility will be fully
repaid.
-
The Company declared a dividend for the second quarter 2024 of $0.75 per
share. The dividend is payable on or about September 12, 2024 to shareholders,
on record as of August 29, 2024.
Ăystein M. Kalleklev, CEO of Flex LNG Management AS, commented:
"Flex LNGâs second quarter came in as guided with revenues of $84.7 million,
which was in line with our guidance of âclose to $85 millionâ. The second
quarter is generally the weakest quarter of the year, and this was also the case
this year with spot earnings bottoming out during the first half of the quarter
in line with the normal seasonal pattern. Seasonally low spot rates affected the
quarterly earnings for Flex Artemis, our only ship on variable hire linked to
the spot market, as well as Flex Constellation, which traded spot for a short
period during April and May before she commenced a 10-month fixed hire Time
Charter in May. This new Time Charter is this fixed until end of first quarter
2025 with the charterer having an option to extend her by one year until end of
first quarter 2026. On the bottom line we delivered net income and adjusted net
income of $21.8 million and $30.4 million respectively.
The seasonal slowdown in the market during the second quarter is also the reason
why we put two ships in drydock during the quarter. During the quarter, we
completed the five-year special survey of the sister ships Flex Constellation
and Flex Courageous according to plan and budget. Both ships were back in
operation during the quarter, and we have no more drydocking stays planned for
the rest of the year. We expect our revenues to increase in the second half of
the year due a new fixed hire contract for Flex Constellation, higher earnings
for the ship with variable hire as spot rates have been picking up and the fact
that we have no more scheduled off-hire for the year. For the third quarter, we
therefore expect revenues to increase to approximately $90 million.
While we recently carried out a balance sheet optimization program, we havenât
stopped exploring ways to further optimize our balance sheet. Hence, we are
today pleased to announce two new financing facilities. On the back of the
recent charter extension of Flex Endeavour, we have secured an attractive $160
million sale and leaseback maturing in 2034. Additionally, we have secured a new
$270 million bank loan for Flex Aurora and Flex Ranger which will mature in
2030. These two new facilities will refinance an existing $375m bank facility,
subject to final documentation and customary closing conditions. The $375
million facility is our first scheduled debt maturity in Q2-2028. Hence, by
refinancing this facility we have not only addressed our first debt maturity,
but we have achieved lower cost of financing, extended debt maturity and
repayment profile while at the same time raising net cash proceeds of
approximately $97 million.
At quarter-end, we had a healthy cash balance of $370m. Our pro-forma cash
balance adjusted for this refinancing thus increase to a solid $467 million. The
combination of a solid cash position, high degree of earnings visibility with
minimum 47 years of firm backlog which may grow to 66 years if charterers
utilize their extension options, improved earnings outlook for the second half
of the year and the positive long-term outlook for the LNG market all contribute
to Flex LNG being well positioned and this is reflected in our dividend. For the
second quarter, the Board has declared a dividend of $0.75 per share. The
trailing twelve months dividend is thus $3.125 per share which gives our
investors an attractive dividend yield of approximately 12 per cent per annum."
Second Quarter 2024 Result Presentation
In connection with the earnings release, a video webcast will be held at today
15:00 CEST (09:00 a.m. EST).
In order to attend the live video webcast use the following link:
Second Quarter 2024 Earnings Presentation (WN Event
-lng/YrvAzYJqnaDp7Z7oX33U/WXlMNJYo8ote5X1DhF2s)
A Q&A session will be held after the 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 teaser with
the highlights of the second quarter. The video can be accessed through the
following link:
YouTube Link (https://www.youtube.com/watch?v=SlHoNU37KyE)
The presentation material which will be used in the live video 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
This information is subject to the disclosure requirements pursuant to section 5
-12 of 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
harbour 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 harbour provisions of the Private
Securities Litigation Reform Act of 1995 and is including this cautionary
statement in
connection with this safe harbour legislation. The words âbelieve,â âexpect,â
âforecast,â âanticipate,â âestimate,â âintend,â âplan,â âpossible,â âpotential,â
âpending,â âtarget,â âproject,â âlikely,â âmay,â âwill,â âwould,â âshould,â
âcouldâ 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, managementâs examination of historical operating
trends, data contained in the Companyâs 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 Companyâs 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 Companyâs
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 its 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
Companyâs 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, changes in the Companyâs operating expenses, including bunker prices,
dry-docking and insurance costs, the fuel efficiency of the Companyâs vessels,
the market for the Companyâs 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, customersâ increasing emphasis
on environmental and safety concerns, potential liability from pending or future
litigation, general domestic and international political conditions or events,
including the war between Russia and Ukraine, as well as the developments in the
Middle East, including continued conflicts between Israel and Hamas and the
conflict regarding the Houthi attack in the Red Sea, 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
(âOther Reportsâ). For a more complete discussion of certain of these and other
risks and uncertainties associated with the Company, please refer to the Other
Reports.
Kilde
