Vessel operating revenues of $97.9 million for the fourth quarter 2022, compared to $91.3 million for the third quarter 2022.
Net income of $41.4 million and basic earnings per share of $0.78 for the fourth quarter 2022, compared to net income of $46.6 million and basic earnings per share of $0.88 for the third quarter 2022.
Average Time Charter Equivalent1 (“TCE”) rate of $81,699 per day for the fourth quarter 2022, compared to $75,941 per day for the third quarter 2022.
Adjusted EBITDA1 of $79.1 million for the fourth quarter 2022, compared to $70.9 million for the third quarter 2022.
Adjusted net income1 of $54.5 million for the fourth quarter 2022, compared to $42.2 million for the third quarter 2022.
Adjusted basic and diluted earnings per share1 of $1.02 for the fourth quarter 2022, compared to $0.79 for the third quarter 2022.
In December 2022, the Company has issued 409,741 ordinary shares under the ATM program, for aggregate gross proceeds of $14.8 million or $36.09 per share with aggregate net proceeds of $14.5 million.
In January 2023, the Company signed 12-year sale and leaseback agreements for Flex Amber and Flex Artemis of $170 million and $160 million respectively, with a margin of 215 basis points per annum.
In February 2023, the Company signed term sheets for a $180 million 10-year sale and leaseback with an Asian-based lease provider agreement for Flex Rainbow.
In February 2023, the Company received credit approved term sheets for a $290 million term and revolving credit facility with a margin of 1.85%, a 6 year tenor and a 22 year age-adjusted repayment profile.
As per date of this report, the Company has SOFR and LIBOR based interest rate swaps with aggregate notional principals of $481 million and $260 million respectively. The weighted average SOFR interest rate is 1.72% with weighted average duration of 6.7 years. Whilst the weighted average LIBOR interest rate is 1.11% with a weighted average duration of 2.3 years.
The Company declared a dividend for the fourth quarter 2022 of $1.00 per share, consisting of a quarterly dividend of $0.75 per share and a special dividend of $0.25 per share.
Øystein M Kalleklev, CEO of Flex LNG Management AS, commented:
“We today release the fourth quarter and full year 2022 results for Flex LNG, and we are pleased to report that our Revenues came in at $98 million which was in line with guidance of $95-98 million. Net income was a solid $41 million with an even healthier adjusted net income of $55 million, reflecting the fact that we realized profits on part of our interest rate derivative portfolio prior to long term rates slumping due to lower US inflation numbers. This resulted in earnings per share and adjusted earnings per share of $0.78 and $1.02 respectively.
During the quarter we continued building attractive charter backlog with minimum 14 years added through an agreement with Cheniere to extend three ships which they already had on Time Charter from us. This agreement added additional earnings visibility to our company. Altogether, we added a total of minimum 38 years of backlog during 2022 through extension of Time Charters with existing customers and our first two fully open positions are now in 2027 which coincide nicely with the next wave of LNG volumes coming to the market in that period. We are therefore upbeat about the prospects for adding additional long term charter backlog for those two ships in due course.
We today also announce that our extensive balance sheet optimization program, which we initiated in November 2021, is now finalized with refinancing secured for the last three ships. As we have added significant charter backlog through 2021 and 2022, we have been able to utilize our de-risked chartering profile to replace all our existing debt with new debt financing with improved terms and conditions. In total, we have secured more than $2bn of new financing during this period and once all the debt is drawn and executed, we expect to release in total $387m in net cash proceeds from this process. This will add further liquidity to our already substantial cash balance. So, with the recent addition of charter backlog coupled with the refinancing process we will have a river of cashflow into a vast pool of liquidity which provides us with ample room to continue paying attractive regular dividends to our shareholders. Given our strong financial position, the Board has therefore decided to pay a special dividend of $0.25 per share in addition to the quarterly dividend of $0.75, bringing the dividend to $1.00 per share for the fourth quarter and in total $3.75 per share declared for 2022. This provides our investors with a solid income stream yielding about 11 per cent.
Going forward we do expect our financial performance to further improve as we are fully booked for 2023. We expect revenues to grow from $348 million in 2022 to around $370 million for 2023, driven by higher Time Charter Equivalent Earnings which we expect to be around $80,000 per day in 2023, an improvement from the $72,800 per day delivered in 2022. Revenues are expected to increase despite us carrying out our first five-year special surveys for four ships with associated off-hire during 2023. Lastly, I would like to extend my gratitude to all personnel both at sea and shore which have contributed to the results presented today.”
Source: FLEX LNG