Flex LNG Swings to Profit, Adds to Fleet

Norwegian LNG carrier owner Flex LNG posted a net income of USD 0.5 million for the third quarter of this year, compared to a net loss of $3.9 million for the second quarter 2019.

It  reported revenues of $29.8 million for the third quarter 2019, compared to $19.0 million for the second quarter 2019.

Øystein M Kalleklev, CEO of Flex LNG Management AS, said: “In line with our expectations, the freight market has become increasingly tighter in the second half of 2019 resulting in much more favorable market conditions despite low gas prices. Flex LNG has been very well positioned for the stronger market with ships available in the spot market as well as ships on variable rates linked to these freight rates."

Kalleklev added: "We are today delivering results in line with guidance for third quarter and our fourth quarter is booked at considerable higher rates with revenue expectations of about $50 to $55 million. During the year we have also secured close to $1.3bn of attractive long-term financing and this together with our in-house ship management company means we are well positioned for the journey ahead.”

Flex LNG said that it has received firm commitments from a syndicate of 11 banks and the Export-Import Bank of Korea (KEXIM) for a $629 million financing for the five newbuildings scheduled for delivery in 2020.

The facility will be divided into a commercial bank loan of USD 250 million, a KEXIM guaranteed loan, funded by commercial banks, of USD 189.1 million and a KEXIM direct loan of USD 189.9 million.

Harald Gurvin, CFO of Flex LNG Management AS, said: “Our track record for 2019 demonstrates our ability to secure financing from various sources at very attractive terms. Having already executed $650 million in new financing during 2019, the new $629 million facility for the five newbuildings delivering in 2020 means have we secured long term funding for 11 of our 13 vessels, with comfortable remaining capex for the two vessels delivering in 2021."

"The new facility was significantly oversubscribed, with commitments from KEXIM and 11 leading international shipping banks. Attractive financing terms also mean attractive cash breakeven levels, giving substantial cash flow potential from our fleet of latest generation LNG carriers,” Gurvin added.