FLNG — FLEX LNG Ltd.

Flex LNG Q4 2025 Earnings Call Summary

1. Key Financial Results and Metrics:

• Q4 Revenues: $87.5 million ($85 million excluding EUAs).
• Net Income: $21.6 million; adjusted net income of $23.3 million, resulting in earnings per share (EPS) of $0.40 and adjusted EPS of $0.43.
• Fleet Average Time Charter Equivalent (TCE): $70,100 per day for Q4; $72,000 per day for the full year.
• Adjusted EBITDA: $251 million for 2025.
• Cash Position: $448 million at year-end; no debt maturing until 2029.
• Dividend: Declared at $0.75 per share, marking the 18th consecutive quarterly dividend.

2. Strategic Updates and Business Highlights:

• Completed the dry docking of Flex Volunteer in January 2026.
• Noted that Flex Aurora will return to the fleet in March 2026 after a charter notice not to declare options.
• 78% of available days in 2026 are fixed on long-term charters, with limited spot exposure.
• The company has a significant contract backlog, with a minimum firm backlog of 50 years, potentially extending to 75 years if options are exercised.

3. Forward Guidance and Outlook:

• 2026 Revenue Guidance: Expected between $310 million and $340 million.
• TCE Guidance for 2026: Projected at $65,000 to $75,000 per day.
• Adjusted EBITDA Guidance: Anticipated to be around $225 million to $255 million.
• The market outlook for 2026 is expected to be volatile, influenced by geopolitical uncertainties and new LNG export volumes.

4. Bad News, Challenges, or Points of Concern:

• The company experienced a reduction in revenues year-on-year due to higher market exposure in a softer spot market.
• Increased operational expenses (OpEx) per day, which rose to $16,600 in Q4, attributed to scheduled maintenance.
• Concerns regarding the oversupply of ships in the market, with many new vessels being delivered without attached contracts, potentially impacting future rates.

5. Notable Q&A Insights:

• The likelihood of charters declaring options on vessels remains uncertain, with management indicating they will report back when decisions are made.
• Future dividend payments will be evaluated at each Board meeting, with a focus on maintaining a solid financial position and cash balance.
• Management expressed a disciplined approach to new building orders, preferring to wait for contracts before committing to new vessels, while remaining optimistic about their existing fleet's performance and market positioning.

Overall, Flex LNG reported solid financial results for Q4 2025, with a strong cash position and consistent dividend payments, but faces challenges from market volatility and increased operational costs. The outlook for 2026 remains cautious yet optimistic, with significant contract coverage and potential for future growth.