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Flex LNG posts healthy earnings; positive outlook

Flex LNG announced its unaudited financial results for the third quarter and nine months ended September 30, 2021.


• Revenues of $81.8 million for the third quarter 2021, compared to $65.8 million for the second quarter 2021.
• Net income of $32.8 million and earnings per share of $0.62 for the third quarter 2021, compared to net income of $12.7 million and earnings per share of $0.24 for the second quarter 2021.
• Average Time Charter Equivalent1 (“TCE”) rate of $68,341 per day for the third quarter 2021, compared to $57,780 per day for the second quarter 2021.
• Adjusted EBITDA1 of $64.5 million for the third quarter 2021, compared to $46.8 million for the second quarter 2021.
• Adjusted net income1 of $32.0 million for the third quarter 2021, compared to $15.7 million for the second quarter 2021.
• Adjusted basic and diluted earnings per share1 of $0.60 for the third quarter 2021, compared to $0.29 for the second quarter 2021.
• In November 2021, the Company announced time charter agreements with an international energy major for the attractive long term fixed rate time charter for two vessels, Flex Resolute and Flex Courageous, with a firm period of three years and options for an additional four years on each vessel. The charters will commence in the first quarter 2021.
• The Company has now secured attractive long-term time charters with a mixed portfolio of market rate and fixed rate contracts and at the date of this report, our Fleet has an aggregate of 33 years firm periods and with charterer’s options this could extend to over 69 years, if declared.
• During the third quarter we purchased 152,656 treasury shares and to date we have repurchased 980,000 shares at an aggregate cost of $9.4 million, or $9.64 per share, in accordance with the share buy-back program.
• In November 2021, the Company signed a sale and charterback agreement for the vessel, Flex Volunteer, resulting in net proceeds to the Company of approximately $37.7 million.
• The Company declared a dividend for the third quarter of $0.75.

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

“We are pleased to announce another strong quarterly report with revenues for the third quarter of $82 million in line with our guidance of approximately $80 million. In the fourth quarter, we will also be handsomely rewarded for maintaining a 30 per cent exposure to the spot market as the spot market is currently on at all time highs. Hence, we are consequently lifting our revenue estimate for the fourth quarter from previously guided $85 to $100 million to about $110 million, thus further improving earnings in the near term.

We have also recently secured another two attractive Time Charters which will further add to our growing backlog while de-risking our portfolio. Since April, we have secured long term fixed hire employment for eight of our ships, with charterers option for a ninth vessel next year, in line with our communicated strategy of securing high margin revenue backlog once the market has improved. Our firm contract backlog is now about 33 years with a further 36 years of optional backlog. This highlights the attractiveness of owning and operating highly efficient ships with significantly lower carbon footprint than the older generation ships.

Given our healthy earnings, positive outlook and super-strong financial position the Board has therefore decided to lift our quarterly dividend level from $0.40 per share to $0.75 per share, which provides our shareholders with a compelling yield of approximately 14 per cent.”

Source: Flex LNG

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