Flex LNG Ltd. yesterday announced its unaudited financial results for the three months and year ended December 31, 2023.

Highlights:

• Vessel operating revenues of $97.2 million for the fourth quarter 2023, compared to $94.6 million for the third quarter 2023.
• Net income of $19.4 million and basic earnings per share of $0.36 for the fourth quarter 2023, compared to net income of $45.1 million and basic earnings per share of $0.84 for the third quarter 2023.
• Average Time Charter Equivalent (“TCE”) rate of $81,114 per day for the fourth quarter 2023, compared to $79,207 per day for the third quarter 2023.
• Adjusted EBITDA of $76.2 million for the fourth quarter 2023, compared to $74.7 million for the third quarter 2023.
• Adjusted net income of $37.8 million for the fourth quarter 2023, compared to $36.1 million for the third quarter 2023.
• Adjusted basic earnings per share of $0.70 for the fourth quarter 2023, compared to $0.67 for the third quarter 2023.
• In January 2024, the charterer of Flex Constellation sent notice that they will not utilize their extension option under the time charter. Following the re-delivery, Flex Constellation is scheduled to perform five-year dry-docking and subsequently will be marketed for short and long-term contracts.
• In January 2024, the charterer of Flex Resolute declared their first option, under the time charter, to extend the firm period by an additional two years to Q1 2027. Following this declaration, the charterer has one additional two-year extension option, which if utilized, would extend the firm contract period to Q1 2029.
• The Company declared a dividend for the fourth quarter 2023 of $0.75 per share. The dividend is payable on or around March 5, 2024 to shareholders, on record as of February 23, 2024.

Øystein M. Kalleklev, CEO of Flex LNG Management AS, commented:

“We today release the fourth quarter and full year 2023 results for Flex LNG, and we are pleased that we have delivered on all our guidance measures for the year. We guided that our revenues would increase from $348 million in 2022 to approximately $370 million in 2023 and we delivered revenues of $371 million in 2023, whilst revenues for the fourth quarter came in at $97.2 million in line with quarterly guidance of $97-99 million. The increase in revenues compared to 2022 was driven by higher Time Charter Equivalent (TCE) rate for the fleet. We guided TCE rate of about $80,000 for the year and delivered TCE rate of $81,000 and $79,500 for the fourth quarter and the full year 2023, respectively.

We also delivered on our guided Adjusted EBITDA level. For the full year we ended up with an Adjusted EBITDA of $290 million, in line with guidance of $290 to $295 million and ahead of the $272 million we delivered in 2022. Lastly, we guided 80-100 days of docking days for our four scheduled drydocking with associated capex of $18-20 million and we delivered this at 77 days and $21 million, respectively. Hence, 2023 was in the context of deliverance on guidance pretty much plain sailing, so I would like to extend my gratitude to all personnel both at sea and onshore which contributed to our success.

Over the next two years, we do see a somewhat more challenging freight market as there are more ships for delivery compared to the expected new export volumes. Hence, we think Flex LNG is very well positioned as we have 94% charter coverage for 2024 and 50 years minimum firm charter backlog, which may increase to 71 years if all charterer’s options are extended. Additionally, our fleet consists entirely of large LNG carriers fitted with the most modern two-stroke propulsion system resulting in significant fuel savings compared to older generation tonnage. Reduced fuel consumption is also good for the environment and with EU Emission Trading System coming into force from 2024, this further enhances the premium which our ships can achieve in the market given the costs associated with such carbon emissions. Lastly, we have a very strong balance sheet where all the LNG carriers are financed with attractive long-term debt while our cash balance at year-end was a comfortable $411 million, giving us a high degree of financial flexibility.

Given the above-mentioned factors, the Board has declared a quarterly dividend of $0.75 per share which calculates to a quarterly dividend payment of about $40 million for our shareholders. For the four quarters of 2023, we have thus declared dividends of $3.125 per share which provides our investors with an attractive running yield of approx. 11 per cent per annum.”
Source: Flex LNG