Flex LNG is ship shape for further growth beyond doubling its fledgling fleet by 2020, according to a maritime shipping analyst.
The John Fredriksen-backed owner of LNG carriers is "well positioned" for fleet expansion, given its $78m in cash, $270m in available credit and attractive financing for four newbuilds, said Seaport Global Securities analyst Magnus Fhyr.
"We believe Flex LNG is financially well positioned to fund its remaining newbuilding commitments while pursuing further fleet expansion opportunities," he wrote in a note to clients.
Oslo-listed Flex LNG owns four large LNGCs -- two 173,400-dwt vessels and two 174,000-dwt ships -- with four of the same ships coming in third quarters of 2019 and 2020 from Daewoo and Hyundai Heavy Industries.
"We believe the timing of Flex's delivery schedule is very attractive as the newbuildings should deliver into a strengthening market," Fyhr said.
He said the newbuilds should make for attractive candidates in the long-term charter market as they will have very efficient two-stroke engines that use 30% less fuel than tri-fuel diesel electric propulsion ships.
"In fact, Flex LNG has currently two vessels on short-term charters and two vessels in the spot market while the four newbuildings remain uncommitted," he wrote.
