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Flex LNG - Second Quarter 2024 Earnings Release

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Flex LNG reported its Q2 2024 financial results, with vessel operating revenues of $84.7 million, down from $90.2 million in Q1. Net income decreased to $21.8 million ($0.41 per share) from $33.2 million ($0.62 per share) in Q1. The average Time Charter Equivalent rate was $72,385 per day, down from $76,539 in Q1.

The company completed scheduled drydocking for two vessels and secured new financing facilities, including a $160 million sale and leaseback for Flex Endeavour and a $270 million bank loan for two other vessels. These refinancings will address Flex LNG's first debt maturity and improve its financial position.

Flex LNG declared a dividend of $0.75 per share for Q2 2024, payable on September 12, 2024. The company expects revenues to increase to approximately $90 million in Q3 2024 due to improved market conditions and no scheduled off-hire.

Flex LNG ha riportato i risultati finanziari del secondo trimestre 2024, registrando ricavi operativi dei vascelli di 84,7 milioni di dollari, in calo rispetto ai 90,2 milioni di dollari nel primo trimestre. L'utile netto è diminuito a 21,8 milioni di dollari (0,41 dollari per azione) rispetto ai 33,2 milioni di dollari (0,62 dollari per azione) del primo trimestre. Il tasso medio di Time Charter Equivalent è stato di 72.385 dollari al giorno, in calo rispetto ai 76.539 dollari del primo trimestre.

L'azienda ha completato il drydocking programmato per due vascelli e ha ottenuto nuove linee di finanziamento, inclusa una vendita e leasing retroattivo di 160 milioni di dollari per il Flex Endeavour e un prestito bancario di 270 milioni di dollari per altri due vascelli. Queste rifinanziamenti affronteranno la prima scadenza di debito di Flex LNG e miglioreranno la sua posizione finanziaria.

Flex LNG ha dichiarato un dividendo di 0,75 dollari per azione per il secondo trimestre 2024, pagabile il 12 settembre 2024. L'azienda prevede un aumento dei ricavi a circa 90 milioni di dollari nel terzo trimestre 2024 grazie a condizioni di mercato migliorate e nessun fermo programmato.

Flex LNG presentó sus resultados financieros del segundo trimestre de 2024, con ingresos operativos de buques de 84.7 millones de dólares, disminuyendo desde los 90.2 millones en el primer trimestre. El ingreso neto se redujo a 21.8 millones de dólares (0.41 dólares por acción) desde 33.2 millones de dólares (0.62 dólares por acción) en el primer trimestre. La tarifa media equivalente de tiempo de fletamento fue de 72,385 dólares por día, en comparación con los 76,539 en el primer trimestre.

La compañía completó el drydocking programado para dos buques y aseguró nuevas facilidades de financiamiento, incluyendo una venta y arrendamiento de 160 millones de dólares para el Flex Endeavour y un préstamo bancario de 270 millones de dólares para otros dos buques. Estos refinanciamientos abordarán el primer vencimiento de deuda de Flex LNG y mejorarán su posición financiera.

Flex LNG declaró un dividendo de 0.75 dólares por acción para el segundo trimestre de 2024, pagadero el 12 de septiembre de 2024. La compañía espera que los ingresos aumenten a aproximadamente 90 millones de dólares en el tercer trimestre de 2024 debido a las mejores condiciones del mercado y la ausencia de inactividad programada.

Flex LNG는 2024년 2분기 재무 결과를 발표했으며, 선박 운영 수익은 8,470만 달러로, 1분기 9,020만 달러에서 감소했습니다. 순이익은 2,180만 달러 (주당 0.41달러)로, 1분기 3,320만 달러 (주당 0.62달러)에서 감소했습니다. 평균 시간 용선 환산율은 72,385달러 매일로, 1분기 76,539달러에서 하락했습니다.

회사는 두 척선에 대한 예정된 도킹 작업을 완료하였으며, Flex Endeavour에 대한 1억 6천만 달러의 매각 및 임대 계약과 두 척선에 대한 2억 7천만 달러의 은행 대출을 포함한 새로운 금융 시설을 확보했습니다. 이러한 재융자는 Flex LNG의 첫 번째 부채 만기를 해결하고 재정적 입지를 향상시킬 것입니다.

Flex LNG는 2024년 2분기에 대해 주당 0.75달러의 배당금을 선언하였으며, 이는 2024년 9월 12일에 지급될 예정입니다. 회사는 시장 여건 개선과 미리 예정된 가동 중지 없음으로 인해 2024년 3분기 수익이 약 9천만 달러로 증가할 것으로 예상하고 있습니다.

Flex LNG a annoncé ses résultats financiers du deuxième trimestre 2024, avec des revenus d'exploitation des navires de 84,7 millions de dollars, en baisse par rapport à 90,2 millions de dollars au premier trimestre. Le bénéfice net a diminué à 21,8 millions de dollars (0,41 dollar par action) contre 33,2 millions de dollars (0,62 dollar par action) au premier trimestre. Le taux moyen d'équivalent de charte à temps était de 72 385 dollars par jour, en baisse par rapport à 76 539 dollars au premier trimestre.

L'entreprise a terminé le docking programmé pour deux navires et a sécurisé de nouvelles facilités de financement, y compris une vente et un contrat de location de 160 millions de dollars pour le Flex Endeavour et un prêt bancaire de 270 millions de dollars pour deux autres navires. Ces refinancements vont traiter la première échéance de dette de Flex LNG et améliorer sa position financière.

Flex LNG a déclaré un dividende de 0,75 dollar par action pour le deuxième trimestre 2024, payable le 12 septembre 2024. L'entreprise prévoit une augmentation des revenus à environ 90 millions de dollars au troisième trimestre 2024 en raison de l'amélioration des conditions du marché et de l'absence de périodes d'inactivité programmées.

Flex LNG hat seine finanziellen Ergebnisse für das zweite Quartal 2024 bekannt gegeben, mit Betriebseinnahmen von 84,7 Millionen Dollar, was einem Rückgang von 90,2 Millionen Dollar im ersten Quartal entspricht. Der Nettogewinn fiel auf 21,8 Millionen Dollar (0,41 Dollar pro Aktie) von 33,2 Millionen Dollar (0,62 Dollar pro Aktie) im ersten Quartal. Der durchschnittliche Tagesmietpreis betrug 72.385 Dollar pro Tag, ein Rückgang von 76.539 Dollar im ersten Quartal.

Das Unternehmen hat die geplante Docking für zwei Schiffe abgeschlossen und neue Finanzierungsmöglichkeiten gesichert, darunter einen Verkauf und Leasing von 160 Millionen Dollar für Flex Endeavour und ein Bankdarlehen von 270 Millionen Dollar für zwei weitere Schiffe. Diese Refinanzierungen werden die erste Schuldenfälligkeit von Flex LNG angehen und die finanzielle Position verbessern.

Flex LNG hat eine Dividende von 0,75 Dollar pro Aktie für das zweite Quartal 2024 erklärt, die am 12. September 2024 zahlbar ist. Das Unternehmen erwartet, dass die Einnahmen im dritten Quartal 2024 auf etwa 90 Millionen Dollar steigen werden, aufgrund verbesserter Marktbedingungen und keiner geplanten Ausfallzeiten.

Positive
  • Secured new financing facilities totaling $430 million, improving debt maturity profile and raising net cash proceeds of $97 million
  • Flex Endeavour's time charter extended by 500 days to Q1 2032
  • New time charter for Flex Constellation until Q1 2025 with option to extend to Q1 2026
  • Expected revenue increase to $90 million in Q3 2024
  • Strong cash position of $370 million, increasing to $467 million pro-forma after refinancing
Negative
  • Vessel operating revenues decreased 6.1% quarter-over-quarter to $84.7 million
  • Net income declined 34.3% quarter-over-quarter to $21.8 million
  • Average Time Charter Equivalent rate decreased 5.4% to $72,385 per day
  • Adjusted EBITDA fell 10.5% to $63.2 million compared to Q1 2024

Insights

Flex LNG's Q2 2024 results show a slight decline in performance compared to Q1. Revenues dropped 6.1% to $84.7 million, while net income decreased 34.3% to $21.8 million. The Average Time Charter Equivalent rate also fell by 5.4% to $72,385 per day.

Despite the seasonal slowdown, Flex LNG maintains a strong financial position with a healthy cash balance of $370 million, set to increase to $467 million post-refinancing. The company's proactive approach to refinancing, securing $430 million in new facilities, demonstrates prudent financial management and improved liquidity.

The consistent dividend of $0.75 per share, yielding approximately 12% annually, remains attractive for income-focused investors. With a minimum 47-year firm backlog and potential extension to 66 years, Flex LNG offers substantial long-term revenue visibility, supporting its dividend sustainability.

Flex LNG's Q2 performance reflects the typical seasonal pattern in the LNG shipping market, with spot rates bottoming out early in the quarter. The company's strategic decision to schedule drydocking for two vessels during this slower period minimizes revenue impact.

The successful completion of five-year special surveys for Flex Constellation and Flex Courageous, with no more drydocking planned for 2024, positions the company well for improved performance in H2 2024. The new time charter for Flex Constellation and expected higher earnings for the variable-hire vessel should contribute to revenue growth.

The extension of Flex Endeavour's charter to Q1 2032 and the potential one-year extension for Flex Constellation demonstrate strong customer relationships and market demand. These long-term commitments enhance Flex LNG's revenue stability and reinforce its market position in the evolving LNG transportation sector.

Flex LNG's Q2 results, while showing a slight decline, align with seasonal expectations and management guidance. The company's forward-looking strategies are noteworthy:

  • Proactive refinancing, extending debt maturities and reducing financing costs
  • Securing long-term charters, enhancing revenue visibility
  • Maintaining a strong dividend policy, attracting yield-seeking investors

The LNG market's positive long-term outlook, coupled with Flex LNG's modern fleet and strong contract coverage, positions the company well for future growth. The expected revenue increase in H2 2024 to approximately $90 million per quarter signals a robust recovery.

Investors should monitor global LNG demand trends, particularly in Asia and potential geopolitical factors affecting energy markets. Flex LNG's ability to secure favorable long-term contracts in a competitive market environment will be important for sustaining its strong market position and financial performance.

HAMILTON, Bermuda, Aug. 14, 2024 /PRNewswire/ -- Flex LNG Ltd. ("Flex LNG" or the "Company") today announced its unaudited financial results for the six months ended June 30, 2024.

Highlights:

  • Vessel operating revenues of $84.7 million for the second quarter 2024, compared to $90.2 million for the first quarter 2024.
  • 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.
  • Average Time Charter Equivalent ("TCE") rate of $72,385 per day for the second quarter 2024, compared to $76,539 per day for the first quarter 2024.
  • Adjusted EBITDA of $63.2 million for the second quarter 2024, compared to $70.6 million for the first quarter 2024.
  • Adjusted net income of $30.4 million for the second quarter 2024, compared to $37.9 million for the first quarter 2024.
  • Adjusted basic earnings per share of $0.56 for the second quarter 2024, compared to $0.70 for the first quarter 2024.
  • In April 2024 and May 2024, we successfully completed our scheduled drydocking for Flex Constellation and Flex Courageous, respectively, on-time and on-budget.
  • 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.
  • 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.
  • 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.
  • 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.

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

"Flex LNG's second quarter came in as guided with revenues of $84.7 million, which was in line with our guidance of "close to $85 million". 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 haven't 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 

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 

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 "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 Q2 2024

 

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SOURCE Flex LNG

FAQ

What were Flex LNG's Q2 2024 earnings results?

Flex LNG reported Q2 2024 vessel operating revenues of $84.7 million, net income of $21.8 million, and basic earnings per share of $0.41.

How much dividend did Flex LNG (FLNG) declare for Q2 2024?

Flex LNG declared a dividend of $0.75 per share for Q2 2024, payable on September 12, 2024, to shareholders of record as of August 29, 2024.

What new financing facilities did Flex LNG secure in July 2024?

Flex LNG secured a $270 million term and revolving credit facility and a $160 million sale and leaseback for Flex Endeavour in July 2024.

What is Flex LNG's revenue guidance for Q3 2024?

Flex LNG expects revenues to increase to approximately $90 million in Q3 2024 due to improved market conditions and no scheduled off-hire.

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