HAMILTON, Bermuda, May 23, 2024
/PRNewswire/ -- Flex LNG Ltd. ("Flex LNG" or the "Company") today
announced its unaudited financial results for the three months
ended March 31, 2024.
Highlights:
- Vessel operating revenues of $90.2
million for the first quarter 2024, compared to $97.2 million for the fourth quarter 2023.
- Net income of $33.2 million and
basic earnings per share of $0.62 for
the first quarter 2024, compared to net income of $19.4 million and basic earnings per share of
$0.36 for the fourth quarter
2023.
- Average Time Charter Equivalent ("TCE") rate of $76,539 per day for the first quarter 2024,
compared to $81,114 per day for the
fourth quarter 2023.
- Adjusted EBITDA of $70.6 million
for the first quarter 2024, compared to $76.2 million for the fourth quarter 2023.
- Adjusted net income of $37.9
million for the first quarter 2024, compared to $37.8 million for the fourth quarter 2023.
- Adjusted basic earnings per share of $0.70 for the first quarter 2024, compared to
$0.70 for the fourth quarter
2024.
- In January and February 2024, the
charterer of Flex Resolute and Flex Courageous declared their first
options, under the time charters, to extend the firm period of each
by an additional two years to Q1 2027. The charterer has one
further option on each vessel, which would extend the firm contract
period to Q1 2029.
- In April 2024, we successfully
completed our scheduled drydocking for Flex Constellation on-time
and on-budget. Flex Courageous is scheduled to complete her
drydocking on-time and on-budget by end of May 2024.
- In April 2024, the charterer of
Flex Endeavour exercised an option to extend the time charter by
500 days from the third quarter of 2030 to the first quarter of
2032.
- 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 in end of
Q1 2025 and an option to extend by an additional one year to end of
Q1 2026.
- The Company declared a dividend for the first quarter 2024 of
$0.75 per share. The dividend is
payable on or about June 21, 2024 to
shareholders, on record as of June 10,
2024.
Øystein M. Kalleklev, CEO of Flex LNG
Management AS, commented:
"Flex LNG's first quarter results came in as expected with
Revenues of $90.2 million in line
with guidance of approximately $90
million. Hence, we are delivering a Net Income of
$33.2 million and Earnings per Share
of $0.62. Our adjusted numbers, where
we primarily adjust for unrealized gains and/or losses on
derivatives, were higher with adjusted Net Income of $37.9 million equal to an adjusted Earnings per
Share of $0.70.
Revenues came in $7 million lower
than during the fourth quarter of 2023, but this was as expected as
we recorded lower earnings on the single ship, Flex Artemis, on a
variable hire rate, Flex Artemis. The fourth quarter is typically
the peak of the LNG freight market, so we tend to generate higher
earnings for this ship during this quarter compared to first
quarter. Additionally, we took one ship, Flex Constellation, out of
service for scheduled drydocking. That said, the Revenues were in
line with the Revenues achieved in the first quarter of 2023 for
very much the same reasons.
During the year we are pleased to have added substantial backlog
through three different charter extensions. The Time Charter
agreements for Flex Resolute and Flex Courageous have both been
extended from first quarter of 2025 to the first quarter of 2027.
The charterer, which is a supermajor, also has an additional option
to extend both ships by another two-year period until first quarter
of 2029. We also added 500 days to the existing Time Charter for
Flex Endeavour with Cheniere, extending the firm period from third
quarter of 2030 to first quarter of 2032.
On top of that, we secured a 10 months' Time Charter for Flex
Constellation until end of first quarter 2025 where the charterer
has the option to extend this ship by one additional year until end
of first quarter 2026. Flex Constellation was redelivered from a
Time Charter to us in March and we then elected to carry out the
five-year special survey of the ship before putting her into the
spot market. However, as communicated in our fourth quarter report
in February, we expected somewhat more challenging freight market
near term due to the glut of newbuilding deliveries. Hence, we
deemed it more attractive for us to charter-out the ship until 2025
possibly to 2026 rather than trading her in the spot market given
the numerous ships currently engaged in this trade.
In total we have thus added 6.2 years of new backlog so far this
year while we have consumed slightly less than five years from
existing contracts which means we have continued to add incremental
backlog with the firm backlog currently at 50 years which may
increase to 69 years in the event the charterers are utilizing all
of their extension options. This attractive backlog gives us a very
high level of earnings visibility and also insulate us against any
near-term market weakness. Given our backlog of an average of four
years per ship, our ships will come open in a window where we
consider the market balance to be significantly more favorable as
the third wave of LNG is coming on stream from end of 2025 onwards.
Furthermore, we also expect a substantial uptick in scrapping of
older steam tonnage, which are becoming commercially obsolete, and
this will further improve market fundamentals.
Given the solid earnings, the substantial backlog and our strong
balance sheet with $383 million of
cash and no debt maturities prior 2028, the Board is pleased to
announce another quarterly dividend per share of $0.75 equal to a quarterly dividend pay-out of
approximately $40 million. This means
that we have paid trailing twelve months dividends of $3.125 per share which gives our investors a
running yield of about 11 per cent. During the last three years,
the total dividend declared and paid has thus grown to $510 million."
First 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:
First Quarter 2024 Earnings Presentation
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 first quarter. The video
can be accessed through the following link:
YouTube link
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 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 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 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, 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 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 ("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.
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Flex LNG - Earnings
Results Q1 2024
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SOURCE Flex LNG