Flex LNG - Third Quarter 2023 Earnings Release - Seite 2

With seasonally stronger spot market heading into the winter season, we expect a further increase in revenues in the fourth and last quarter of the year with expected revenues of $97-99m. This is also in the high end of our guidance of $90-100m. With the third quarter numbers presented today and the guidance for fourth quarter, we are thus well on track to deliver on our revenue guidance for the year of $370m, our adjusted EBITDA target of $290-295m and the overall average Time Charter Equivalent guidance of $80,000 per day.

The overall freight and product market today ahead of the peak winter season is fairly balanced. The LNG product market is well supplied as supply curtailments have recently been limited despite the noise. That said, spot LNG prices remain at about $15/mmbtu which still reflects a tight market with LNG being priced at premium to crude oil which is somewhat unusual in historical context. As LNG export growth will continue to be fairly muted the next two years, we do expect the LNG product market to stay tight as European buyers will continue to be buyers both of first and last resort. Active buying by Europeans also means Atlantic cargoes will continue to be pulled towards Europe instead of Asia which will put a dent on sailing distances in the near term. The spot freight market will therefore continue to experience a very high level of volatility depending on season. From the end of 2025 we do however see a wave of new LNG coming onstream, and we expect these volumes to gradually alleviate market tightness and make LNG affordable to consumers with shallower pockets. Consequently, with newbuilding deliveries peaking at end of 2025, we do see incrementally tighter shipping market from 2026 onwards. We therefore think our two fully open ships in 2027 and two fully open ships in 2028 are attractively positioned for re-contracting opportunities. This is particularly the case given the elevated newbuilding prices which have pushed up term rates to very attractive levels for owners of modern fuel-efficient tonnage.

Given our quadfecta of strong numbers, completed drydocking program, very solid cash position of $429m and the compelling long-term outlook, the Board has decided this time to declare a special dividend of $0.125 on top of our regular quarterly dividend of $0.75 bringing the quarterly dividend per share for the third quarter to $0.875. During the last twelve months, we have thus paid out dividends of $3.375 per share which provides our shareholders with an attractive annualized running yield of about 11 per cent.”