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Flex LNG reported revenues of $355 million in 2024, down from $371 million in 2023 and a rise compared to $347.9 million in 2022, while adjusted Ebitda reached $273 million.
The shipping firm controlled by billionaire John Fredriksen expects 2025 revenues of about $340-360 million with TCE (time charter equivalent rate) of $72,000-75,000 per day.
Adjusted Ebitda is expected to be $250-270 million in 2025.
Fourth quarter
In the fourth quarter, Flex LNG reported revenues of $90.9 million, a slight rise compared to $90.5 million for the third quarter.
Revenues dropped compared to $97.2 million for the fourth quarter of 2023.
Flex LNG said the fourth quarter of 2024 included $1.4 million in EU ETS revenue.
Flex LNG reported net income of $45.2 million and basic earnings per share of $0.84 for the fourth quarter of 2024, compared to net income of $17.4 million and basic earnings per share of $0.32 for the third quarter of 2024.
The company reported average TCE rate of $75,319 per day for the fourth quarter of 2024, compared to $75,426 per day for the third quarter of 2024.
62 years of minimum charter backlog
Øystein Kalleklev, CEO of Flex LNG, said the company delivered “stellar financial performance for the fourth quarter in line with our previous guidance.”
“We recorded substantial profits on our portfolio of interest rate swaps as we increased our interest rate hedging significantly during the interest rate slump at the beginning of September,” he said.
“During the fourth quarter, interest rates rallied, and we therefore booked $20.1 million of gains on these derivatives of which $5.1 million were realized during the quarter. Hence, adjusted net income for the fourth quarter came in at $30.8 million, corresponding to earnings per share and adjusted earnings per share of $0.84 and $0.57 respectively,” Kalleklev said.
The CEO noted that during 2024, and in the fourth quarter particularly, Flex LNG was able to secure new “attractive backlog which will insulate us from the current market weakness.”
In November, Flex LNG announced extension of the time charters for Flex Courageous and Flex Resolute.
Furthermore, in December, the company revealed a new 15-year time charter for Flex Constellation from 2026 to 2041 where the charterer has the option to extend the ship up to 2043.
“Flex LNG is thus very well positioned with 62 years of minimum charter backlog equal to about five years of contract backlog per ship, on average. Furthermore, this backlog may grow to 96 years in the event charterers utilize all their extension options,” Kalleklev said.
Outlook for LNG shipping “challenging”
Kalleklev said the short to medium-term outlook for LNG shipping is “challenging” given the numerous ship deliveries ahead of ramped up new export capacity.
“As such, we think 2024 to 2027 will probably resemble the period 2014 to 2017,” he said.
“There is one key difference, we will likely see a sharp increase in the demolition of older, less efficient tonnage, primarily steam tonnage which will prepare the ground for improved markets, similar to what was experienced in 2017,” Kalleklev said.
“In any case, Flex LNG utilized the upturn in 2021 to 2023 well to build both a fortress balance sheet and charter backlog and we are well prepared for the current weak market. We are therefore guiding financial performance in 2025 to be in line with what we achieved in 2024,” he added.