Enerflex Ltd. Provides Full-Year 2023 Update and Preliminary Outlook for 2024

REPAID APPROXIMATELY US$120 MILLION OF DEBT DURING Q4 2023

PRELIMINARY OUTLOOK FOR 2024 REFLECTS STRONG DEMAND ACROSS BUSINESS UNITS AND GEOGRAPHIC REGIONS

DISCIPLINED CAPITAL PROGRAM IN 2024, PRIORITIZING DEBT REDUCTION AND LOWERING NET FINANCE COSTS

CALGARY, Alberta, Jan. 16, 2024 (GLOBE NEWSWIRE) -- Enerflex Ltd. (TSX: EFX) (NYSE: EFXT) (“Enerflex” or the “Company”) today is providing a full-year 2023 update and its preliminary financial and operational outlook for 2024.

FULL-YEAR 2023 UPDATE

Based on our preliminary review of unaudited results, Enerflex estimates 2023 capital expenditures of approximately US$110 million, below our guidance range of US$120 million to US$140 million, as we prioritized debt reduction to lower net financing costs. As at December 31, 2023, Enerflex’s net debt¹ balance was less than US$900 million, which reflects gross debt repayments of approximately US$120 million during the fourth quarter.

OUTLOOK

Enerflex’s preliminary outlook for 2024 reflects strong demand across our business units and geographic regions. The company is focused on generating free cash flow and further improving our financial flexibility.

Operating results in 2024 will be underpinned by the highly contracted Energy Infrastructure product line and the recurring nature of After-market Services, which together are expected to account for 55% to 65% of our gross margin before depreciation and amortization². Complementing Enerflex's recurring revenue businesses is the Engineered Systems product line, which carried a backlog of approximately CAD$1.5 billion (US$1.1 billion) as at December 31, 2023 and is expected to benefit from increasing natural gas production in our core regions. The Company expects the majority of its backlog to convert into revenue over the next 12 months.

Enerflex is targeting a disciplined capital program in 2024, with total capital expenditures of US$90 million to US$110 million. This includes a total of approximately US$70 million for maintenance and PP&E capital expenditures. Investing to expand our Energy Infrastructure business in 2024 is discretionary and will be allocated to customer supported opportunities that are expected to generate attractive returns and deliver value to Enerflex shareholders.

Providing meaningful shareholder returns, including a sustainable dividend, continues to be a priority for Enerflex. We recognize this has been impacted in the near-term by increased leverage and interest expense. Enerflex will continue to focus on debt reduction and lowering net finance costs in 2024, which will improve our ability to provide shareholder returns over the medium and long-term. We continue to evaluate our target long-term capital structure and capital allocation parameters and expect to provide more clarity in the coming months.