Flex LNG turns to profit on rebalanced market

Flex LNG, the company controlled by billionaire John Fredriksen and an emerging player in the LNG shipping business turned to a $1.2 million profit in the third quarter of the year compared to a $4 million net loss in the third quarter of 2017. 

The company also tightened its net loss for the first nine months of the year from $11.7 million in 2017 to $3.5 million during the period under review.

Commenting on the results, Øystein Kalleklev, Flex LNG’s CEO and CFO said the company’s improved financial performance in the third quarter and the improved fourth-quarter guidance were helped by the market rebalancing.

“Unlike the vast majority of other LNG shipping companies, we decided to strategically pursue shorter-term employment until the shipping market showed signs of rebalancing. The market has now rebalanced with current fixtures now being agreed at all-time high rates,” Kalleklev said.

He noted the company expects the LNG shipping market to remain tight due to a combination of a large increase in liquefaction capacity in the near, medium and long-term, limited fleet growth, increased ton/mileage and increased focus on improving air quality favoring the ongoing switch from coal to natural gas.

The company today has four vessels on the water and nine additional newbuildings under construction which are set for delivery in 2019-2021, increasing the fleet to a total of thirteen high-end LNG carriers.

Flex LNG said it has already covered all available days for the fourth quarter expecting revenues of approximately $35 million in the period, up on the $19 million reported in the quarter under review.