John Fredriksen-controlled Flex LNG sees the need for LNG restocking will mean more demand for flexible US cargoes during the summer.
Announcing fourth quarter results, chief executive Oystein Kalleklev said he does not expect to see a repeat of the US cargo cancellations seen in mid-2020.
“With an improved economic outlook, we do expect LNG exports to grow steadily in 2021, as the US is expected to produce close to capacity and this will also be positive for shipping demand,” he said.
Earnings up
Flex reported a rise in fourth quarter net income up at $25.8m, from $23.9m in the same period in 2019.
Revenue for the quarter increased to $67.4m compared to $52m a year ago.
Average time-charter equivalent earnings for the final three months of 2020 came in at $73,712 per day, up from $46,569 per day logged in the previous quarter 2020.
Kalleklev said Flex has booked 87% of its fleet in the first quarter 2021 at what he described as “healthy rates”.
On the back of this, he said Flex expects its revenue to climb to between $80m and $90m in first quarter 2021.
“The stronger trading results reflects generally higher charter rates at the start of the year, as well as delivery of two newbuildings in January 2021,” he said.
12 down, one to go
Flex, which has now taken delivery of 12 of its 13 LNG carriers, detailed that its last three delivering LNG newbuildings found charters.
The company said its 10th vessel, the 174,000-cbm Flex Amber (built 2020) started a 12-month charter with variable hire terms on its delivery in October.
In January the newbuildings 173,400-cbm Flex Freedom and 174,000-cbm Flex Volunteer were delivered onto short-term charters at what the company described as “attractive rates”.
Flex expects to take delivery of its final newbuilding, 174,000-cbm Flex Vigilant, in the second quarter.
On crew changes, Kalleklev said these had been on time for 96% of Flex seafarers. But he said: “We aim to bring this number up to 100% as soon as possible.”
Gurvin goodbyes
Flex announced it has appointed former Swedbank senior banker Knut Traaholt as its new chief financial officer.
Traaholt, who will join the company in the second quarter, will take over from CFO Harald Gurvin who is leaving from 31 March after more than 15 years working with first with SFL Corp and then with Flex.
Kalleklev said Gurvin had made an “invaluable contribution”, done a “fantastic job” and been “a great colleague”.
“Harald will be leaving the company with a great legacy in terms of a super-strong financial position,” the CEO added.
Gurvin described his time with the group companies as “exciting and fruitful years” and said he was pleased to be leaving the company “uniquely positioned, both commercially and financially.”
“I would like to thank my friends and colleagues for a fantastic journey, and wish them continued success going forward,” he added.
