Slide 1: Arctic Securities presentation
Arctic Securities presentation August 26, 2020 1
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS MATTERS DISCUSSED IN THIS PRESENTATION 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 T
Slide 3: Highlights
HIGHLIGHTS • Weak spot market in Q2/Q3 due to Covid-19 affecting demand Commercial • 100% technical availability of ships despite pandemic • TCE(1) of $47kpdr in Q2 in line with guidance (TCE of $57kpdr in H1-20) • Adj. net loss(1) of $0.7m in Q2 (adj. net income of $8.6m in H1-20) Finance • $920m d
Slide 4: Balanced Contract Portfolio
BALANCED CONTRACT PORTFOLIO Fixed hire TCs Variable hire TCs Spot market Newbuildings • Flex Ranger • Flex Enterprise • Flex Endeavour • Flex Freedom • Flex Aurora • Flex Rainbow • Flex Constellation • Flex Volunteer • Flex Resolute • Flex Artemis • Flex Courageous • Flex Vigilant • Flex Amber 94% o
Slide 5: Spot Market Review
SPOT MARKET REVIEW Spot LNGC headline freight rates per day (MEGI/XDF) Ballast bonus conditions 10 250,000 7.5 RT 200,000 5 150,000 FBB 2.5 100,000 0 50,000 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2019 2020 - 2017 2018 2019 2020 Very weak ballast bonus conditions in April- July, but sharp im
Slide 6: Global Gas Prices Recovered from Summer Lows
GLOBAL GAS PRICES RECOVERED FROM SUMMER LOWS $/Mmbtu 12.00 10.00 8.00 6.00 4.00 2.00 - HHI JKM TTF Oil linked (high) Oil linked (low) Oil linked pricing ~70% volumes 1) Source: CME, Energy Aspect, IGU 6 2) Oil linked (high) is 331 formula with 14% Brent slope while oil price (low) is 331 formula wit
Slide 7: European Imports Up by About 9MT (16%)
EUROPEAN IMPORTS UP BY ABOUT 9MT (16%) Monthly European LNG imports (MT) European inventory levels stabilizing 12 Bcm 10 8 6 4 2 0 Rest France Italy Spain Turkey United Kingdom Pipeline gas imports in Europe during H1 was down ~22mt 1) Source: Kpler, IEA and Energy Aspects 7
Slide 8: US Exports Rebounded
1) Weekly Source: Kpler 0.2 0.4 0.6 0.8 1.2 1.6 1 0 Export (Mt) 1.4 2020/1 2020/2 2020/3 2020/4 2020/5 2020/6 2020/7 2020/8 Sabine Pass 2020/9 US EXPORTS REBOUNDED 2020/10 2020/11 Cameron 2020/12 2020/13 2020/14 2020/15 2020/16 2020/17 Corpus Christi 2020/18 2020/19 2020/20 2020/21 Cove Point 2020/2
Slide 9: Floating Storage Has Balanced the Market
FLOATING STORAGE HAS BALANCED THE MARKET 1) Source: IEA 9
Slide 10: We Expect ~20MT Lost Exports Due to COVID-19
WE EXPECT ~20MT LOST EXPORTS DUE TO COVID-19 Estimated US Cargo cancellations: 174 2 12 35 45 45 26 9 25 June: +10mt July: +5mt April: -6mt ~270 cargoes August -2mt ~25 ship years 15 5 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec -5 Month growth 2019 Month growth 2020 Pre-covid expectation Actual
Slide 11: Financing Secured for All Vessels
FINANCING SECURED FOR ALL VESSELS $m (1) $100M Bank Facility $156.4M Sale & Leaseback Flex Ranger (2018) 600 Flex Amber (Q3 2020) $250M Bank Facility Flex Constellation (2019) 500 $300M Sale & Charterback Flex Courageous (2019) Flex Endeavour (2018) 400 Flex Enterprise (2018) (1) $125M Bank Facility
Slide 12: Summary
SUMMARY • Flex LNG is well positioned with a mixed portfolio of fixed and variable TCP as well as spot ships • We expect incrementally tighter shipping market with less cargo cancellations from September • Winter temperatures and economic recovery will decide the length of shipping tightness as well
Slide 13: Bon voyage!
AT = FLEX LNG FLEX ARTEMIS %