Flex LNG - Fourth Quarter 2022 Earnings Release

14 Feb 2023 07:00 CET

February 14, 2023
Hamilton, Bermuda

Flex LNG Ltd. ("Flex LNG" or the "Company") today announced its unaudited
financial results for the fourth quarter ended December 31, 2022.

Highlights:

* 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 Equivalent(1) ("TCE") rate of $81,699 per day for the
fourth quarter 2022, compared to $75,941 per day for the third quarter 2022.

* Adjusted EBITDA(1) of $79.1 million for the fourth quarter 2022, compared to
$70.9 million for the third quarter 2022.

* Adjusted net income(1) 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 share(1) 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."


Fourth Quarter 2022 Result Presentation

In connection with the earnings release, a live video webcast will be held at
3:00 p.m. CET (9:00 a.m. EST). In order to attend the live video webcast use the
following link:

Flex LNG Q4 2022 Webcast (https://events.webcast.no/flex-
lng/YrvAzYJqnaDp7Z7oX33U/p9tqLnDsuXlQ1kEILMLY)

A Q&A session will be held after the conference/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 video in
which Øystein Kalleklev, CEO of Flex LNG, discusses the highlights of the fourth
quarter. The video can be accessed through the following link:

Flex LNG Q4 2022 Highlights (https://www.youtube.com/watch?v=22tIlO-kFd8)

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 announcement is considered to include inside information pursuant to the EU
Market Abuse Regulation and is subject to the disclosure requirements pursuant
to section 5-12 of the Norwegian Securities Trading Act. This announcement was
published by Knut Traaholt, CFO of Flex LNG, at the date and time set out above.


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 our 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 and outbreaks of other highly communicable diseases, including the
length and severity of the COVID-19 outbreak and its impact on the LNG tanker
market, 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 recent conflict between Russia and
Ukraine, 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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(1) Time Charter Equivalent rate, Adjusted EBITDA, Adjusted net income/(loss)*
and Adjusted earnings/(loss) per share are non-GAAP measures. A reconciliation
to the most directly comparable GAAP measure is included in the end of this
earnings report.

More information:
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582261_Flex LNG - Earnings Release Q4 2022.pdf