Flex LNG Fetches USD 250 Mn Loan for Newbuilding Duo

Oslo-listed owner of LNG carriers Flex LNG has secured a USD 250 million loan from a syndicate of banks for the financing of two newbuildings delivering in 2019.

The vessels in question are the 173,400 cbm Flex Constellation and Flex Courageous, under construction at South Korea’s Daewoo Shipbuilding and Marine Engineering Okpo yard.

Flex LNG said that the financing remains subject to documentation and customary closing conditions, and is expected to be drawn upon delivery of the vessels from the shipyard, currently scheduled for June and August 2018, respectively.

The financing will partly cover the remaining USD 144 million payable upon delivery of each of the vessels. The remaining balance is expected to be funded from the company’s available liquidity.

The new facility will have a term of five years from delivery of the last vessel and will bear interest at LIBOR plus a margin of 2.35% per annum.

Flex LNG unveiled the development in its 2018 financial report. For the full year 2018, the company delivered revenues of USD 77.2 million, compared to USD 27.3 million reported for 2017. Net profit was at USD 11.8 million for the year, against a net loss of USD 10.4 million seen a year earlier.

“We are pleased to deliver strong results for the fourth quarter in line with our guidance. During the fourth quarter we capitalized on a strong market and clearly demonstrated the earnings potential of our new fifth generation LNG carriers. While the market is currently soft due to weaker shipping demand, we remain upbeat about the outlook for LNG shipping as a glut of new liquefaction capacity is coming on line both near and long term,” Øystein M Kalleklev, Flex LNG CEO, said.