Slide 1: Third Quarter Result Presentation
Third Quarter Result Presentation November 12, 2024 1
Slide 2: Disclaimer
DISCLAIMER MATTERS DISCUSSED IN THIS PRESS RELEASE 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 THEIR BUSINESS.
Slide 3: Q3 Highlights
Q3 HIGHLIGHTS Note: 1) Adjusted net income, adjusted EPS and TCE are non-GAAP measures. A reconciliation to the most directly comparable GAAP measure is included in the earnings report, 2) LTM dividend yield assuming a share price of $24 3
Slide 4: Q3 Results in Line with Guiding
Q3 RESULTS IN LINE WITH GUIDING Q3-2024 Rest of year guiding Key metrics Guiding Actuals Q4-2024 FY2024 TCE rate ~$75-77’/day ~$75,400/day ~$73-75’/day ~$75’/day Revenues Approx. $90m $90.5m Close to $90m $353-355m Adj. EBITDA Approx. $70m $70.4m Close to $70m $271-274m Note: 1) Adjusted EBITDA and
Slide 5: Secured Up to 20 Years Backlog from 2029 Onwards
SECURED UP TO 20 YEARS BACKLOG FROM 2029 ONWARDS Flex Courageous (MEGI + PRS 173,400m3) Key takeaways: • As announced November 7, we have secured additional firm contract backlog for both Flex Courageous and Flex Resolute with minimum 3 years firm period from Q1-2029 to Q1-2032 and extension options
Slide 6: High Contract Coverage and Earnings Visibility
HIGH CONTRACT COVERAGE AND EARNINGS VISIBILITY… 50 years of min. charter backlog which may grow to 82 years with charterer’s extension options 5 7 E y V E d I R NA R C E A NA E NA A R NA C NA A O O 6
Slide 7: Supporting a Stable & Attractive Dividend
…SUPPORTING A STABLE & ATTRACTIVE DIVIDEND… Quarterly dividend, $m 13th consecutive ordinary dividends of $0.75 per share, S totalling $569m when including the special dividends O 7
Slide 8: Because Earnings Belong to Shareholders
…BECAUSE EARNINGS BELONG TO SHAREHOLDERS Short-term market outlook deemed to be ! The structural demand remains intact, i.e. the long-term market outlook is ✓ Note: 1) Adjusted EPS is non-GAAP measures. A reconciliation to the most directly comparable GAAP measure is included in the earnings report
Slide 9: Key Financial Figures
KEY FINANCIAL FIGURES Revenues, $m TCE, $/day Commentary: • TCE of ~$75,400/day in Q3-2024 vs. ~$72,400/day in Q2-2024, explained by two vessels completed five-year special survey during the second quarter, as well as higher variable index hire from Flex Artemis in the third quarter YT YT YT YT • Av
Slide 10: Solid $450M Cash Position After Completion of Refinancings
SOLID $450M CASH POSITION AFTER COMPLETION OF REFINANCINGS Cash flow from Q2-2024 to Q3-2024, $m -$81 Completed on October 3, 2024 $ 450 Fully repaid existing debt on three vessels and subsequently made drawdown on new $270m debt facility for two of our vessels, leaving Flex $ 290 $ 370 Endeavour de
Slide 11: Swap Portfolio: Added More Duration at Attractive Levels
SWAP PORTFOLIO: ADDED MORE DURATION AT ATTRACTIVE LEVELS Hedge ratio1 Q3-24, $m S • In September, we capitalized on favourable market conditions by terminating $420m in H H existing interest rate swaps and entered into 5 new swaps $425m with longer duration. 5 5 • We replaced shorter-term swaps with
Slide 12: Flexible and Low-Cost Funding Portfolio
FLEXIBLE AND LOW-COST FUNDING PORTFOLIO Debt funding portfolio as per Q3-20241 We benefit from a diverse range of available funding alternatives, including cost-efficient bank debt, Japanese lease arrangements, and interest rate hedging solutions. $ 5 Fixed rate debt of $233m with an average All-in
Slide 13: Fortress Balance Sheet
FORTRESS BALANCE SHEET A STABLE CASH FLOWS CAPITAL AVAILABLE WITH LIMITED CAPEX LIABILITIES SUPPORTS THE FLEX LNG LOW CARRY COST AND FIRST DEBT MATURITY JOURNEY IN 2028 l ~ VY Sustainable cash flows from long $450m in available cash. 2025 capex liability limited to Strong balance sheet with term fix
Slide 14: Incremental LNG Demand Moved from Europe to Asia
INCREMENTAL LNG DEMAND MOVED FROM EUROPE TO ASIA Top LNG exporters, YT-2024, MT -1% +1% +3% Top LNG importers, YTD-2024, MT -0.9 MT +1.8 MT +3.3 MT % = Percentage change YTD-2024 from YTD-2023 + MT = Absolute change YTD-2024 from YTD-2023 114 +5% -22% -0% +1.3 MT -22.2 MT -0.3 MT 81 +10% +1% +6.1 MT
Slide 15: Europe Has Reduced Its Call on LNG YTD
EUROPE HAS REDUCED ITS CALL ON LNG YTD- … Total European LNG imports YTD-2024, MT Y/y change in natural gas imports to Europe, MT 15 12 9 N R O NG 6 European gas storage levels, % of full 100 80 3 60 40 20 0 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct No
Slide 16: While Asian LNG Demand Remains Firm
…WHILE ASIAN LNG DEMAND REMAINS FIRM Total Asian LNG imports YTD-2024, MT Total JKT LNG imports YTD-2024, MT 16 2019 - YTD-'24 range 2023 2024 30 13 10 27 7 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total China LNG imports YTD-2024, MT 24 9 7 5 21 3 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov
Slide 17: Canal Inefficiencies Support Tonne-Mile Effect
CANAL INEFFICIENCIES SUPPORT TONNE-MILE EFFECT US LNG exports to Asia via route, MT FY2020: ~27 MT FY2021: ~34 MT FY2022: ~19 MT FY2023: ~24 MT YTD-24: ~24 MT 5 4 3 US shut-ins US LNG shoring up Europe 2 1 0 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22 Jan-23 Jul-23 Jan-24 Jul-24 Via Panama Canal Via C
Slide 18: Dark Evader: Western Sanctions Give Rise to LNG Dark Fleet
DARK EVADER: WESTERN SANCTIONS GIVE RISE TO LNG DARK FLEET Metagas Energy, 2003-built 138,000 cbm: 3 port calls to Arctic LNG 2 YTD-24 Saam FSU, 2023-built 354,000 cbm Asya Energy, 2002-built 137,000 cbm: 2 port call to Arctic LNG 2 YTD-24 Mulan, 2024-built 79,800 cbm: 1 port call to Arctic LNG 2 YT
Slide 19: High Vessel Availability Weigh on Spot Rates
HIGH VESSEL AVAILABILITY WEIGH ON SPOT RATES Vessel availability, # of vessels per week Spot charter rates modern tonnage (2-stroke), $’ 40 250 30 225 20 200 10 175 0 150 1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 Pacific Middle East Atlantic 5 yr Average 125 Spot vs. T
Slide 20: The First Mass EEXI-tinction in LNGC Is Near
THE FIRST MASS EEXI-TINCTION IN LNGC IS NEAR Age distribution of steam fleet, # of vessels # of steam vessels redelivered from contract 25 120 100 20 80 15 202 steam 60 powered 10 LNGCs 40 5 20 0 0 Dec-24 Dec-25 Dec-26 Dec-27 Dec-28 Dec-29 # of ST vessels (lhs) Acumulative (rhs) • Spot charter rates
Slide 21: Newbuilding Prices Stabilized, Long-Term Rates at ~$85,000/Day
NEWBUILDING PRICES STABILIZED, LONG-TERM RATES AT ~$85,000/DAY Source: Fearnleys, Clarksons, SSY 21
Slide 22: Our Backlog Insulates Us from Near Term Fleet Growth
OUR BACKLOG INSULATES US FROM NEAR TERM FLEET GROWTH LNGC newbuild delivery, # of vessels Available NBs (% of orderbook) N C High newbuild prices discourage speculative ordering Orderbook by propulsion MEGA MEG T T E A Source: Fearnleys, SSY 22
Slide 23: Third Wave of LNG Will Add >200 MTPA in New Capacity
THIRD WAVE OF LNG WILL ADD >200 MTPA IN NEW CAPACITY Liquefaction supply, MTPA 800 1st wave: 2nd LNG wave: 3rd LNG wave: 2006-’10 2015-’20 2026-’30 700 Qatar adds ~50 Australia adds ~40 MT, MT and US add >60 MT 600 500 USA 400 Australia 300 Qatar 200 Other 100 0 2005 2010 2015 2020 2025 2030 Source:
Slide 24: We Are Well Positioned for the Next Tightening Cycle
WE ARE WELL POSITIONED FOR THE NEXT TIGHTENING CYCLE LNG shipping balance, # of 174,000 cbm equivalent LNGCs 1,000 Fleet 900 LNG shipping demand 800 Market tightening expected to commence 700 in 2027, with the market being undersupplied from that point forward 600 Assumes 53x steam vessels to gradua
Slide 25: Trumponomics Set to Fuel More US LNG, but Risk of Trade War
TRUMPONOMICS SET TO FUEL MORE US LNG, BUT RISK OF TRADE WAR 1 “D , baby, d ” 2 An end to the LNG export permit pause 3 Trumponomics 2.0 US dry shale natural gas production, bcfd North American liquefaction projects with 100 export (re-)approvals/permits needed, MTPA Other Eagle Ford 80 Utica Permian
Slide 26: Q3 Highlights
Q3 HIGHLIGHTS Note: 1) Adjusted net income, adjusted EPS and TCE are non-GAAP measures. A reconciliation to the most directly comparable GAAP measure is included in the earnings report, 2) LTM dividend yield assuming a share price of $24 26
Slide 27: Thank you!
Ww Thank you! a