Slide 1: Interim Report Presentation
Interim Report Presentation Period ending 31 December 2018 28 February 2019 11 | | 2017 2018
Slide 2: Disclaimer
Disclaimer • THIS PRESENTATION (THE “PRESENTATION”) HAS BEEN PRODUCED BY FLEX LNG LTD. ("FLEX LNG" OR "THE COMPANY”), SOLELY FOR PRESENTATION PURPOSES AND DOES NOT PURPORTE TO GIVE A COMPLETE DESCRIPTION OF THE COMPANY, ITS BUSINESS OR ANY OTHER MATTER DESCRIBED HEREIN. • THE PRESENTATION DOES NOT C
Slide 3: Highlights
Highlights • Flex LNG reports fourth quarter Revenues of $36.1m in line with guidance of approx. $35m. • Significantly improved EBITDA and Net Income of $28.3m and $15.2m versus $12.7m and $1.2m respectively in third quarter. • In connection with a $300m equity raise in October 2018, Flex LNG acquir
Slide 4: Unique fleet comprising of 13 modern large 5th generation LNGCs
Unique fleet comprising of 13 modern large 5th generation LNGCs ME-GI and X-DF vessels are the most fuel-efficient and technically advanced LNGCs High Pressure Low pressure ME-GI with Partial ME-GI with Full X-DF ME-GI Reliquefaction System Reliquefaction System Ranger (2018) Endeavour (2018) Relian
Slide 5: The year in numbers illustrate first class operational performance
The year in numbers illustrate first class operational performance 46 13.9kts ballast 130,524 NM Ballast Port calls Average 48% time Distance Speed spent laden 130,222 NM Laden 15,9kts laden Circumference of Earth: 21,639 NM 0% technical 0% off-hire Sick 3,334,402cbm leave Cargo LTI: 0 LTIF: 0 78,35
Slide 6: Income Statement
Income Statement Unaudited Figures in USD, 000 Q4 2018 Q3 2018 YTD 2018 Voyage revenues 36 101 19 008 77 209 Voyage related costs -5 977 -5 167 -26 161 Administrative expenses -1 781 -1 132 -4 639 EBITDA 28 343 12 709 46 409 Depreciation -6 872 -5 477 -17 412 EBIT 21 471 7 232 28 997 Finance income
Slide 7: Balance Sheet
Balance Sheet Unaudited Figures in USD, 000 YE 2018 YE 2017 YE 2018 YE 2017 Newbuildings and capitalized costs 0 594 937 Share capital 5 410 3 680 Vessel purchase prepayment 421 472 72 000 Share premium 1 189 665 885 323 Vessels 812 489 3 Other equity -367 751 -368 902 Total non-current assets 1 233
Slide 8: Cashflow
Cashflow Unaudited Figures in USD, 000 Q4 2018 YTD 2018 • Positive operational cashflow of about $23m and $ 34m for the fourth quarter and 2018 respectively Net Income (loss) 15 226 11 769 Working capital adjustments 1 320 4 918 Other non-cash items 6 839 17 392 Net cash flow from operating 23 385 3
Slide 9: Attractive take-out financing secured for 2019 deliveries
Attractive take-out financing secured for 2019 deliveries • $250m post-delivery bank financing secured for Flex Constellation and Flex Courageous scheduled for delivery June and August 2018 • Blue-chip terms and conditions • Interest rate of Libor+235bps (margin) • Loan tenor of five years and repay
Slide 10: Well capitalized for remaining newbuildings
Well capitalized for remaining newbuildings $m $325m of available liquidity $m $421m of capex pre-paid 350 1 800 1 600 300 275 1 400 250 146 1 200 918 200 270 1 000 150 325 800 600 1 225 100 400 728 50 200 55 0 0 Cash 31.12.18 Sterna RCF Available liquidity Newbuilding capex Pre-paid capex Remaning
Slide 11: Freight market has been volatile this winter
Freight market has been volatile this winter Spot $/Day Spot Market, daily rates ($) Type of vessel Atlantic Middel East Pacific 200 000 174 cbm 2-stroke 63 000 58 000 58 000 160 cbm TFDE 47 000 42 000 42 000 150 000 145 cbm ST 34 000 29 000 29 000 Fuel + 50% Hire Ballast Bonus to Hub Fuel only Fuel
Slide 12: And the same is the case for the product market
And the same is the case for the product market 20,00 20% 18,00 18% 16,00 16% 14,00 14% 12,00 12% 10,00 10% 8,00 8% 6,00 6% 4,00 4% 2,00 2% 0,00 0% Jul-14 Jul-15 Jul-16 Jul-17 Jul-18 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 Henry Hub NBP JKM JKM % Brent (RHS) • Well supplied LNG market due to new c
Slide 13: What was different this winter
What was different this winter Continental European LNG import destinations Peru Norway USA Up 450% and counting Algeria Nigeria Russia Up 350% and counting Qatar 0 1 2 3 4 5 Winter 17/18 Winter 18/19* * Cumulative figures Oct-Mar. Winter 18/19 numbers from 1 Oct to 24 Feb 2019 • Historically, Asian
Slide 14: El Nino conditions have resulted in higher temperatures in Pacific
El Nino conditions have resulted in higher temperatures in Pacific Sea Surface Temperature in Pacific November 2018 December 2018 January 2019 14 || 2017 14 2018 Source: Australian Bureau of Metrology
Slide 15: Glut of LNG coming to the market
Glut of LNG coming to the market Year on Year Change LNG Export Volumes Post FID AND Likely LNG Export Projects Mmtpa-Post FID Mmtpa 40 600 35 Other 500 30 North America 25 Russia 400 20 Africa Indonesia 300 15 Malaysia 10 200 Australia 5 Qatar 100 - (5) 0 2008 2009 2010 2011 2012 2013 2014 2015 201
Slide 16: Few available vessels before 2020
Few available vessels before 2020 Order book for large LNG carriers Average sailing distances (laden) 4 800 16 Committed Open 14 4 600 1 12 4 400 7 Nautical Miles 10 # Vessels 6 2 4 200 8 4 2 9 6 12 4 000 4 8 6 8 3 7 6 6 3 800 5 1 2 2 2 2 2 1 1 0 3 600 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qtr2 Qtr3 Qtr4 Qtr1 Qt
Slide 17: Tonnage demand by key LNG export areas
Tonnage demand by key LNG export areas ~2,2 x Vsl ~2,2 x Vsl ~1,5 x Vsl ~1,4 x Vsl US LNG destination ~0,8 x Vsl 74% 54% ~1,2 x Vsl 35% 15% 11% 10% Americas Asia/Middle Europe East Q4-17 Q4-18 2018 2019E Vessel New % split Country / Region % of Supply Multiplier New Export MT Demand Supply Africa 10
Slide 18: Summary and outlook
Summary and outlook • Delivered on financial guidance for fourth quarter with Revenues of $36.1m and Net Income for the quarter of $15.2m • Secured financing for the two 2019 LNG newbuildings at attractive terms • Expect first quarter numbers to be in line with third quarter due to soft market early
Slide 19: Q&A
Q&A 19 || 2017 19 2018 2018