Olso-based Flex LNG has reported record revenues of $114.6 mill for the fourth quarter 2021, compared to $81.8 mill for the previous quarter.
Net income was also at an all time high of $69.4 mill and basic earnings per share of $1.31 for 4Q21, compared to $32.8 mill and an EPS of $0.62 for the third quarter of last year. Adjusted net income was $62.8 mill, compared to $32 mill for 3Q21.
EBITDA was also a record $95.5 mill for 4Q21, compared to $64.5 mill in the previous quarter.
The average TCE rate was $95,908 per day, compared to $68,341 per day for 3Q21.
Flex LNG said it had secured attractive long-term timecharters with a mixed portfolio of market rate, spot and fixed rate contracts. As of 16th February, the fleet had an aggregate of 32 years firm periods and with charterer’s options, this could rise to over 65 years, if they are firmed up.
CEO Øystein Kalleklev, said: “We are pleased to deliver knock-out results for the fourth quarter as guided. Fuelled by four ships exposed to a red-hot spot market, revenues for the fourth quarter jumped from $82 mill to $115 mill, slightly ahead of our guidance of approximately $110 mill.
“Our average Time Charter Equivalent earnings came in at a solid $95,908 per day, beating the $94,000 per day we managed to achieve during fourth quarter 2019 and close to the $97,571 per day achieved in fourth quarter 2018. In the past, we had significantly higher spot exposure, so by being able to beat previous trading results also reflects that during 2021 we have secured an outstanding portfolio of fixed hire timecharters.
“Higher top line also resulted in a fatter bottom line in fourth quarter with our net income and adjusted net income coming in at a healthy $69.4 mill and $62.8 mill, respectively. Overall, for the year we delivered net income and adjusted net income of $162 mill and $145 mill, respectively, which we deem attractive.
“In November, we announced a balance sheet optimisation programme. By de-risking our commercial strategy through adding substantial long-term backlog we reached out to financiers with the aim of unlocking $100 mill of cash from our balance sheet. Today, we are announcing $695 mill of new financing. These financings will release another $87 mill in cash on top of the $38 mill announced in November through the ‘Flex Volunteer’ sale and charterback.
“We have thus already over-delivered on the programme initiated in November with $125 mill unlocked overall, which will contribute to further growth of our cash balance, which stood at a lofty $201 mill at year end. Hence, we have a super strong liquidity position, enabling us to act quickly on opportunities if they arise.
“The spot freight market went from red-hot in November to ice cold in January, despite elevated gas prices. The primary reason for the spot market slump was that the European gas market went haywire in December, due to concerns about gas availability, coupled with a tense security situation in Ukraine with potential implications for Russian pipeline flows to Europe.
“This resulted in European gas prices trading at a premium to Asian gas prices, which effectively closed the West/East arbitrage, having a detrimental effect on sailing distances and thus increased the availability of ships.
“As the market shake out subsides, we do however think the freight market will re-balance as volume growth in 2022 is expected to exceed 2021, while the number of newbuildings set for delivery this year is about half of last year.
“We are guiding revenues for 2022 in line with what we achieved in 2021, despite the soft spot market at the beginning of the first quarter 2022,” he concluded.
