FLEX LNG Ltd.
FLEX LNG Ltd.
08/20/2025 | Press release | Distributed by Public on 08/20/2025 04:16
Second Quarter 2025 (Form 6-K)
Second Quarter 2025
August 20, 2025
August 20, 2025 - Hamilton, Bermuda
Flex LNG Ltd. ("we", "us", "our", "Flex LNG", or the "Company") today announced its unaudited financial results for the six months ended June 30, 2025.
Highlights:
A summary of our financial highlights for the quarter are below:
| Q2 2025 | Q1 2025 | ||||||||||
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Vessel operating revenues 1
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$86.0m | $88.4m | |||||||||
| Net income | $17.7m | $18.7m | |||||||||
| Earnings per share (basic) | $0.33 | $0.35 | |||||||||
| Cash and cash equivalents | $412.7m | $409.6m | |||||||||
| Vessels and equipment, net | $2,130.4m | $2,138.5m | |||||||||
| Long-term debt | $1,802.2m | $1,783.8m | |||||||||
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Non-GAAP Measures 2
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| Time Charter Equivalent rate | $72,012 | $73,891 | |||||||||
| Adjusted EBITDA | $62.6m | $65.6m | |||||||||
| Adjusted net income | $24.8m | $29.4m | |||||||||
| Adjusted earnings per share (basic) | $0.46 | $0.54 | |||||||||
(1)Vessel operating revenues includes $2.0 million income related to European Union Allowances ("EUAs") (Q1 2025: $1.6 million). The EUAs are receivable from our Charterers under the time charter contracts for voyages subject to the European Union's Emissions Trading System ("EU ETS"). An equivalent amount has been recorded under Voyage expenses for the relevant period.
(2)Time Charter Equivalent rate, Adjusted EBITDA, Adjusted net income/(loss) and Adjusted earnings/(loss) per share are non-GAAP measures. A reconciliation to the most directly comparable GAAP measure is included at the end of this earnings report.
A summary of key events:
•In June and July 2025, we successfully completed our scheduled drydocking for Flex Aurora and Flex Resolute, respectively;
•In May 2025, the Company signed and completed a sale and leaseback agreement with an Asian-based lease provider for the vessel, Flex Courageous (the "Flex Courageous Sale and Leaseback"). Under the terms of the agreement, the vessel was sold for a consideration of $175.0 million, with a bareboat charter back of 10 years, as previously announced. The Company repaid the full amount outstanding for Flex Courageous under the $320 Million Sale and Leaseback;
•In July 2025, we signed a $180.0 million term loan facility in respect of Flex Constellation (the "$180 Million Facility") with an international shipping bank. The $180 Million Facility has a 15.5 year tenor and an interest rate of SOFR plus a margin of 165 basis points. The repayment of the facility is based on a 25 year age-
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1
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Flex LNG Ltd. Second Quarter Results 2025
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adjusted repayment profile1 for the first 7.5 years, and thereafter follows a 22 year profile until maturity, when the facility is fully repaid. In August 2025, we prepaid the full amount outstanding relevant to Flex Constellation under the $320 Million Sale and Leaseback. The new facility is expected to be drawn down in September 2025;
•In August 2025, we signed a sale and leaseback agreement with an Asian-based lease provider for the vessel, Flex Resolute. Under the terms of the agreement, the vessel will be sold for a consideration of $175.0 million, with a bareboat charter back of approximately 10 years. The new financing is expected to be completed in September 2025, subject to final documentation and customary closing conditions;
•The Board of Directors has authorised a share repurchase program that allows the Company to repurchase up to $15 million of its outstanding shares listed on the New York Stock Exchange ("NYSE") and the Oslo Stock Exchange ("OSE"), which is valid through November 27, 2025. The manner, timing, pricing and amount of the repurchases under the program (if any) will be subject to the discretion of the Company and may be based upon a number of factors, including market conditions, and in accordance with applicable rules and regulations;
•In June 2025, the Company filed an application to the OSE for the delisting of the Company's common shares from the OSE, following the decision made at the 2025 Annual General Meeting of Shareholders ("AGM"). The OSE accepted the application and announced that Company's common shares will be delisted as of September 16, 2025 and the last day of listing will be September 15, 2025;
•The Company declared a dividend for the second quarter 2025 of $0.75 per share. The dividend is payable on or about September 18, 2025 to shareholders, on record as of September 5, 2025.
1 The age-adjusted repayment profile is a metric that we use to calculate the repayment period of our loans and leases to zero, in years and adjusted for the age of the financed vessel. The metric is used to compare repayment profiles between facilities on vessels of different ages.
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Flex LNG Ltd. Second Quarter Results 2025
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Marius Foss, Interim CEO of Flex LNG Management AS, commented:
"We are today reporting second quarter revenues of $86 million, or $84 million excluding EUAs, with a TCE of approximately $72,000/day, almost unchanged from last year's second quarter revenues of $84.7 million. Although the second quarter is historically the weakest of the year, spot earnings bottomed out in the first quarter, making 2025 one of the rare years where Q2 rates exceeded Q1 levels. However, the spot market still remained soft. This affected the quarterly earnings for Flex Artemis, which is on a variable charter, as well as Flex Constellation, which is trading in the spot market before she commences a 15-year time charter in the first half of 2026. Vessel OPEX was in line with our guidance, and net income for the quarter was $17.7 million, implying an EPS of $0.33 per share, with adjusted net income of $24.8 million, equivalent to adjusted EPS of $0.46 per share.
During June and July, we completed the five-year special surveys for Flex Aurora and Flex Resolute. Both drydockings were finished well ahead of our guided 20 days of off-hire, demonstrating our ability to minimize off-hire periods. Flex Aurora's drydocking cost came in slightly above budget due to her five-year special survey being conducted in Denmark, which was a deliberate choice aligned with her loading schedule. This enabled a faster return to service with the charterer, partly offsetting the higher costs. Looking ahead, Flex Artemis and Flex Amber are scheduled for their drydockings in Singapore in the third quarter. These successful drydockings are a great testament to the dedication and professionalism of our technical team and the committed crew on board. We sincerely appreciate their outstanding efforts and safe execution throughout the process.
Due to our minimum 56 year charter backlog, potentially extending to 85 years including charterers' optional periods, we enjoy access to highly attractive financing opportunities. We are pleased to announce the completion of documentation for two new financing facilities for Flex Resolute and Flex Constellation. We have secured a new $175 million JOLCO lease for Flex Resolute. This transaction mirrors the JOLCO lease for Flex Courageous, which we announced in the first quarter and was completed in May. In addition, we have obtained a very competitive bank loan facility of $180 million for Flex Constellation. These refinancings will extend our debt maturities, reducing our cost of financing, and realizing around $132 million in proceeds from the Balance Sheet Optimization Program 3.0.
The OSE has approved the delisting of the Flex LNG stock, and the last day of listing on the OSE will be September 15 this year. After this date, the Flex LNG stock will be listed exclusively on the NYSE.
We are today announcing the launch of a share buy-back program of up to $15 million. The share buy-back program will last until the Q3-2025 earnings release date, currently set to November 27, 2025. Any purchase under the share buy-back program is made independently of any dividend considerations.
With solid earnings, a substantial backlog, and a fortress balance sheet with $413 million in cash and no debt maturities prior to 2029, the Board is pleased to declare another quarterly dividend of $0.75 per share, equivalent to approximately $41 million. This brings our trailing twelve-month dividend to $3.00 per share. It also marks our sixteenth consecutive ordinary quarterly dividend of $0.75, and when including special dividends, we will have returned approximately $690 million to shareholders since Q4 2021."
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Flex LNG Ltd. Second Quarter Results 2025
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Business Update and Fleet Overview
In June and July 2025, we successfully completed our scheduled drydocking for Flex Aurora and Flex Resolute, respectively. The drydockings were completed ahead of time, minimising offhire days. Flex Resolute was completed within budget, while Flex Aurora came in slightly above budget due to the drydocking being conducted in Denmark.
Flex Constellation continued to operate on the spot market until the commencement of a 15-year time charter contract during the first or second quarter of 2026.
Flex Artemis is expected to be re-delivered from the original 5-year variable hire contract in the third quarter of 2025. Following the re-delivery, Flex Artemis will perform her scheduled dry-docking and will subsequently be marketed for short and long-term contracts.
At the date of this report, the firm contract coverage is 85.7% for the remainder of 2025, and the aggregate firm contract backlog for the fleet is 56 years based on the earliest charter expirations, which could increase to 85 years if our charterers exercise all of the contracted options.
We achieved technical uptime excluding offhire for drydocking on our vessels of 100.0% in the second quarter 2025.
For the remainder of 2025, we have 14.5% exposure to the spot market. The 2025 market exposure is related to our market-linked contract for Flex Artemis; and the open period in respect of Flex Constellation and Flex Artemis upon re-delivery from the current charters.
The following table sets forth an overview of our fleet as of August 20, 2025:
| Vessel Name | Year Built |
Shipyard(1)
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Cargo Capacity (cbm) |
Propulsion(2)
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Boil off rate |
Charter expiration(3)
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Expiration with Charterer options(4)
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| Flex Endeavour | 2018 |
HO
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173,400 | MEGI+PRS | 0.075% | Q1 2032 | Q1 2033 | ||||||||||||||||
| Flex Enterprise | 2018 |
HO
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173,400 | MEGI+PRS | 0.075% | Q2 2029 | NA | ||||||||||||||||
| Flex Ranger | 2018 | SHI | 174,000 | MEGI | 0.085% | Q1 2027 | NA | ||||||||||||||||
| Flex Rainbow | 2018 | SHI | 174,000 | MEGI | 0.085% | Q1 2033 | NA | ||||||||||||||||
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Flex Constellation
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2019 |
HO
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173,400 | MEGI+PRS | 0.075% |
Q1 2041(6)
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Q1 2043 | ||||||||||||||||
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Flex Courageous(5)
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2019 |
HO
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173,400 | MEGI+PRS | 0.075% | Q1 2027 |
Q1 2039
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| Flex Aurora | 2020 | HSHI | 174,000 | X-DF | 0.085% | Q2 2026 | Q2 2028 | ||||||||||||||||
| Flex Amber | 2020 | HSHI | 174,000 | X-DF | 0.085% | Q2 2029 | NA | ||||||||||||||||
| Flex Artemis | 2020 |
HO
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173,400 | MEGI+FRS | 0.035% | Q3 2025 | NA | ||||||||||||||||
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Flex Resolute(5)
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2020 |
HO
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173,400 | MEGI+FRS | 0.035% | Q1 2027 |
Q1 2039
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| Flex Freedom | 2021 |
HO
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173,400 | MEGI+FRS | 0.035% | Q1 2027 | Q1 2029 | ||||||||||||||||
| Flex Volunteer | 2021 | HSHI | 174,000 | X-DF | 0.085% | Q1 2026 | Q1 2028 | ||||||||||||||||
| Flex Vigilant | 2021 | HSHI | 174,000 | X-DF | 0.085% | Q2 2031 | Q2 2033 | ||||||||||||||||
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Flex LNG Ltd. Second Quarter Results 2025
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(1) As used in this report, "HO" means Hanwha Ocean (formerly known as Daewoo Ship building and Marine Engineering Co. Ltd.), "SHI" means Samsung Heavy Industries, and "HSHI" means Hyundai Samho Heavy Industries Co. Ltd. Each is located in South Korea.
(2) "MEGI" refers to M-type Electronically Controlled Gas Injection propulsion systems and "X-DF" refers to Generation X Dual Fuel propulsion systems. "FRS" and "PRS" refers to Full or Partial Re-liquefaction Systems.
(3) The expiration of our charters is considered the firm period known to the Company as of August 20, 2025, however these are generally subject to re-delivery windows ranging from 15 to 45 days before or after the expiration date.
(4) Where charterers have extension option(s) to be declared on a charter; the expiration provided assumes all extension options have been declared by the charterer for illustrative purposes.
(5) The charterer of Flex Courageous and Flex Resolute, amended and extended the time charter contracts, to include a new firm period from Q1 2029 to Q1 2032, following the end of the last two year option period from Q1 2027 to Q1 2029 under the original time charter contracts. The addendum includes additional options for the Charterer to extend each vessel up to Q1 2039.
(6) Flex Constellation will operate in the spot market until the commencement of a 15-year time charter contract during the first or second quarter of 2026. This contract includes options for the charterer to extend the vessel by additional two years up to 2043.
Finance update
As of June 30, 2025, the Company had cash and cash equivalents of $412.7 million, which includes fully drawn revolving tranches under the $270 Million Facility, $290 Million Facility and the Flex Enterprise $150 Million Facility.
As of June 30, 2025, the Company had total long-term debt of $1,802.2 million, with the current portion of $105.9 million and non-current portion of $1,696.3 million.
In May 2025, the Company signed and completed a sale and leaseback agreement with an Asian-based lease provider for the vessel, Flex Courageous (the "Flex Courageous Sale and Leaseback"). Under the terms of the agreement, the vessel was sold for a consideration of $175.0 million, with a bareboat charter back of approximately 10 years. The lease is repaid on an age-adjusted repayment profile1 of approximately 22 years. The Company has the first option to terminate the lease and repurchase the vessel at fixed price after approximately 7 years. The
1 The age-adjusted repayment profile is a metric that we use to calculate the repayment period of our loans and leases to zero, in years and adjusted for the age of the financed vessel. The metric is used to compare repayment profiles between facilities on vessels of different ages.
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Flex LNG Ltd. Second Quarter Results 2025
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bareboat lease is comprised of a fixed interest element and a floating interest element based on Term SOFR, plus a margin. The Company repaid the full amount outstanding of $129.6 million for Flex Courageous under the $320 Million Sale and Leaseback. As a result of this re-financing, the Company received net cash proceeds of approximately $43.0 million.
In July 2025, we signed a $180.0 million term loan facility in respect of Flex Constellation (the "$180 Million Facility") with an international shipping bank. The $180 Million Facility has a 15.5 year tenor and an interest rate of SOFR plus a margin of 165 basis points. The repayment of the facility is based on a 25 year age-adjusted repayment profile1 for the first 7.5 years, and thereafter follows a 22 year profile until maturity, when the facility is fully repaid. In August 2025, we prepaid the full amount outstanding relevant to Flex Constellation, under the $320 Million Sale and Leaseback facility. Following this repayment, the $320 Million Sale and Leaseback facility is repaid in full. The new facility is expected to be drawn down in September 2025.
In August 2025, we signed a sale and leaseback agreement with an Asian-based lease provider for the vessel, Flex Resolute. Under the terms of the agreement, the vessel will be sold for a consideration of $175.0 million, with a bareboat charter back of approximately 10 years. The lease is repaid on an age-adjusted repayment profile1 of approximately 21 years. The Company has the first option to terminate the lease and repurchase the vessel at fixed price after approximately 7 years. The bareboat lease is comprised of a fixed interest element and a floating interest element based on Term SOFR, plus a margin. The Company will repay the full amount outstanding under the Flex Resolute $150 Million Facility. The new financing is expected to be completed in September 2025, subject to final documentation and customary closing conditions.
The Board of Directors has authorised a share repurchase program that allows the Company to repurchase up to $15 million of its outstanding shares listed on the NYSE and the OSE, which is valid through November 27, 2025. The manner, timing, pricing and amount of the repurchases under the program (if any) will be subject to the discretion of the Company and may be based upon a number of factors, including market conditions, and in accordance with applicable rules and regulations.
In order to reduce the risks associated with fluctuations in interest rates, the Company has entered into interest rate swap transactions, whereby floating rate has been swapped to a fixed rate of interest. In April 2025, the Company completed three new swap transactions with an aggregate notional principal of $150.0 million, a weighted average fixed rate of 3.46% and a weighted average duration of 1.77 years. As of June 30, 2025, the Company has fixed interest rates on an aggregate notional principal amount of $850.0 million. The interest rate swaps have a fixed rate of interest based on SOFR with a weighted average fixed interest rate of 2.33% and a weighted average duration of 3.0 years.
1 The age-adjusted repayment profile is a metric that we use to calculate the repayment period of our loans and leases to zero, in years and adjusted for the age of the financed vessel. The metric is used to compare repayment profiles between facilities on vessels of different ages.
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Flex LNG Ltd. Second Quarter Results 2025
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Results for the three months ended June 30, 2025 and March 31, 2025
The Company recorded vessel operating revenues of $86.0 million for the second quarter 2025, compared to $88.4 million in the first quarter 2025. The revenue includes income from EUAs under the EU ETS of $2.0 million for the second quarter 2025 and $1.6 million for the first quarter 2025. An equivalent amount has been recorded under voyage expenses for the relevant periods. The decrease in revenue is due to two vessels, Flex Aurora and Flex Resolute entering drydock in the period, thus resulting in offhire days in June 2025. In addition to this, Flex Constellation commenced a new time charter contract at a lower daily rate of hire in the period. This is offset by a ballast bonus earned on re-delivery from the previous charterer.
Voyage expenses, which include voyage specific expenses, broker commissions, EUAs and bunker consumption, were $3.0 million in the second quarter 2025, compared to $2.0 million in the first quarter 2025.
Vessel operating expenses were $18.2 million in the second quarter 2025, compared to $18.1 million in the first quarter 2025.
Administrative expenses were $1.9 million in the second quarter 2025, compared to $2.5 million in the first quarter 2025.
Depreciation was $19.0 million in the second quarter 2025, compared to $18.6 million in the first quarter 2025.
Interest income was $1.3 million in the second quarter 2025, compared to $0.9 million in the first quarter 2025.
Interest expense was $24.3 million in the second quarter 2025, compared to $22.1 million in the first quarter 2025. The increase in interest expense is due to the revolving credit facilities being drawn down in the period for a greater number of days compared to the first quarter 2025.
Extinguishment costs of long-term debt were $1.6 million in the second quarter 2025, compared to nil in the first quarter 2025. This relates to the write-off of unamortized debt issuance costs of $1.0 million and prepayment fees $0.6 million in relation to the extinguishment of debt for Flex Courageous under the $320 Million Sale and Leaseback.
The Company recorded a net loss on derivatives of $1.3 million in the second quarter 2025, which includes an net unrealized loss of $5.7 million, as a result of the change in fair value of our interest rate swap derivatives and a net realized gain of $4.3 million on interest rate swap settlements in the period. This compares to a net loss on derivatives for the first quarter 2025 of $7.3 million, which included a net unrealized loss of $11.0 million and a net realized gain of $3.7 million.
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Flex LNG Ltd. Second Quarter Results 2025
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The Company recorded a foreign exchange gain of $0.2 million in the second quarter 2025, compared to a $0.3 million gain in the first quarter 2025.
The Company recorded other financial items expense of $0.4 million in the second quarter 2025, compared to an expense of $0.3 million in the first quarter 2025.
Net income for the second quarter 2025 was $17.7 million and basic earnings per share were $0.33, compared to a net income of $18.7 million and basic earnings per share of $0.35 for the first quarter 2025.
Adjusted EBITDA1 was $62.6 million for the second quarter 2025, compared to $65.6 million for the first quarter 2025.
Adjusted net income1 for the second quarter 2025 was $24.8 million and adjusted earnings per share of $0.46, compared to an adjusted net income of $29.4 million and adjusted earnings per share of $0.54 for the first quarter 2025.
The time charter equivalent rate1 for the second quarter 2025 was $72,012 per day compared to $73,891 per day for the first quarter 2025.
Results for the six months ended June 30, 2025 and June 30, 2024
Vessel operating revenues were $174.4 million for the six months ended June 30, 2025 compared to $174.9 million for the six months ended June 30, 2024. The decrease in revenue is due to the decline in spot market rates, which affected the variable rate contract for Flex Artemis, as well as a lower rate of hire achieved for Flex Constellation, as she was deployed in the short term market from the first quarter of 2025. This is offset by the positive revenue effect arising from the amendment to the time charter contracts for Flex Resolute and Flex Courageous in November 2024. In addition, the Company recorded revenue of $3.6 million related to European Union Allowances (EUAs) in the first and second quarter of 2025. An equivalent amount has been recorded under voyage expenses for the period.
Voyage expenses, which include voyage specific expenses, broker commissions, EUAs and bunker consumption, were $5.0 million for the six months ended June 30, 2025 compared to $1.3 million for the six months ended June 30, 2024. The increase in voyage expenses is due to the accrual of $3.6 million in relation to the obligation to settle EUAs under the EU ETS. An equivalent amount has been recorded under Vessel operating revenues for the period.
1 Time Charter Equivalent rate, Adjusted EBITDA, Adjusted net income/(loss) and Adjusted earnings/(loss) per share are non-GAAP measures. A reconciliation to the most directly comparable GAAP measure is included in the end of this earnings report.
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Flex LNG Ltd. Second Quarter Results 2025
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Vessel operating expenses were $36.3 million for the six months ended June 30, 2025, compared to $34.5 million for the six months ended June 30, 2024. The increase in vessel operating expenses is due to higher costs related to crew changes and costs incurred for auxiliary engine maintenance as a result of reaching running hour milestones.
Administrative expenses were $4.5 million for the six months ended June 30, 2025 compared to $5.3 million for the six months ended June 30, 2024.
Depreciation for the six months ended June 30, 2025 amounted to $37.5 million compared to $37.5 million for the six months ended June 30, 2024.
Interest income was $2.1 million in the six months ended June 30, 2025, compared to $2.1 million in the six months ended June 30, 2024.
Interest expense was $46.4 million in the six months ended June 30, 2025, compared to $53.8 million in the six months ended June 30, 2024. The decrease in interest expense is due to the decline in average 3-month SOFR in the first and second quarter of 2025 compared to the first and second quarter of 2024. This decrease was also due to the reduction in average debt drawn down during the period, as a result of refinancing of loan facilities in the third and fourth quarter of 2024.
Extinguishment costs of long-term debt were $1.6 million in the six months ended June 30, 2025, compared to nil in the six months ended June 30, 2024. This relates to the write-off of unamortized debt issuance costs of $1.0 million and prepayment fees $0.6 million in relation to the extinguishment of debt for Flex Courageous under the $320 Million Sale and Leaseback.
The Company recorded a net loss on derivatives of $8.6 million in the six months ended June 30, 2025, which includes a net unrealized loss on derivatives of $16.7 million and a net realized gain of $8.0 million. This compares to a net gain on derivatives of $10.8 million in the six months ended June 30, 2024, comprising a net unrealized loss of $2.6 million and a net realized gain of $13.4 million. The unrealized gain or loss on derivatives is primarily driven by the movements in the fair value of the interest rate swaps.The realized gain/(loss) on derivative settlements will be affected by changes in the shorter term floating rate of interest compared to the respective agreements' fixed rate of interest.
The Company recorded a foreign exchange gain of $0.5 million in the six months ended June 30, 2025, compared to a loss of $0.3 million in the six months ended June 30, 2024.
The Company recorded other financial items expense of $0.6 million in the six months ended June 30, 2025, compared to an expense of $0.1 million in the six months ended June 30, 2024.
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Flex LNG Ltd. Second Quarter Results 2025
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The Company reported a net income of $36.4 million and basic earnings per share of $0.67 for the six months ended June 30, 2025, compared to a net income of $55.1 million and basic earnings per share of $1.02 for the six months ended June 30, 2024.
Adjusted EBITDA1 for the six months ended June 30, 2025, was $128.1 million compared to $133.8 million for the six months ended June 30, 2024.
Adjusted net income1 for the six months ended June 30, 2025, was $54.2 million and basic adjusted earnings per share of $1.00, compared to an adjusted net income of $68.3 million and basic adjusted earnings per share of $1.27 for the six months ended June 30, 2024.
The time charter equivalent rate1 for the six months ended June 30, 2025, was $72,958 per day compared to $74,472 per day for the six months ended June 30, 2024.
Cash Flow for the three months ended June 30, 2025 and March 31, 2025
Total cash, cash equivalents and restricted cash was $412.7 million as at June 30, 2025, compared to $410.1 million as at March 31, 2025.
Net cash provided by operating activities in the second quarter 2025 was $26.9 million, compared to $40.2 million in the first quarter 2025. In the second quarter 2025, net income, after adjusting for non-cash items, was $44.4 million compared to $48.7 million in the first quarter 2025. Expenditure in relation to 2025 drydockings was $10.9 million for the second quarter 2025, compared to $2.6 million for the first quarter 2025. The Company had negative working capital adjustments of $10.2 million for the second quarter 2025, compared to $5.9 million in the first quarter 2025.
Net cash used in investing activities was $nil in the second quarter 2025 and in the first quarter 2025.
Net cash used in financing activities was $24.4 million in the second quarter 2025, compared to $67.7 million provided by financing activities in the first quarter 2025.
Balance Sheet as at June 30, 2025
In the six months ended June 30, 2025, the net book value of vessels and equipment was $2,130.4 million compared to $2,154.5 million as at December 31, 2024. The movement is explained by depreciation of $37.5 million and additions of $13.5 million in relation to vessel drydockings.
1 Time Charter Equivalent rate, Adjusted EBITDA, Adjusted net income/(loss) and Adjusted earnings/(loss) per share are non-GAAP measures. A reconciliation to the most directly comparable GAAP measure is included in the end of this earnings report.
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Flex LNG Ltd. Second Quarter Results 2025
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As at June 30, 2025, total long-term debt was $1,802.2 million, compared to $1,810.2 million as at December 31, 2024, of which the current portion of long-term debt was $105.9 million and $106.7 million respectively.
In the six months ended June 30, 2025, the following material factors resulted in an increase in the Company's long-term debt:
•Closing of the Flex Courageous Sale and Leaseback;
•Regular amortization of debt issuance costs of $1.2 million; and
•Write-off of unamortised debt issuance costs of $1.0 million relating to the prepaid $320 Million Sale and Leaseback.
Whereas, the following material factors resulted in a decrease in the Company's long-term debt:
•Regular repayment of debt of $54.3 million;
•Prepayment of $129.6 million, which was the outstanding amount relevant to Flex Courageous, under the $320 Million Sale and Leaseback; and
•New financing costs of $1.4 million in relation to the new Flex Courageous Sale and Leaseback.
As at June 30, 2025, total equity was $762.0 million compared to $806.6 million as at December 31, 2024. This decrease in equity consists of distributions paid of $81.1 million, offset by net income of $36.4 million and $0.1 million relating to equity settled share-based compensation for six months ended June 30, 2025.
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Flex LNG Ltd. Second Quarter Results 2025
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LNG Market Update
The Q2-2025 spot LNG shipping market rebounded from the soft levels recorded in Q1-2025. Rates saw a brief spike in mid-June, as heightened geopolitical tensions between Israel and Iran raised fears that the Strait of Hormuz could close. The Atlantic Basin continued to be more active than the Pacific Basin, supported by FOB tenders and stronger European demand. The average spot rate for modern two-stroke vessels during the quarter was around $30,000/day, up from $17,000/day in Q1-2025. At present, spot rates for modern two-strokes are quoted at $35,000/day to $40,000/day. In terms of number of spot market fixtures, shipbrokers reported a high number of short-term fixtures concluded during the second quarter, consistent with the expansion of the LNG fleet and growth in freight volumes.
Global LNG trade grew by 2% (4.8 MT) in the first seven months of the year, reaching 245 MT by the end of July. Europe remained the primary destination for US LNG cargoes, with imports rising 24% to 74 MT compared with the same period in 2024. The increase reflects efforts to replace reduced pipeline gas flows from Russia, alongside European storage levels less than ~33% full capacity coming out of the withdrawal season. Europe has faced limited competition for LNG out of the US, in part because China and India have scaled back purchases in favour of cheaper coal and LPG. Between January and July, combined LNG imports by the two countries dropped from roughly 60 MT to 50 MT. Meanwhile, Japan is on track to overtake China as the world's largest LNG importer in 2025. Across the more mature JKT region - Japan, South Korea, and Taiwan - total imports reached 79 MT in the January-July period, down 1% from last year.
On the supply side, the US remains the main driver of growth. US LNG exports surged 22% year-on-year to 60 MT in the January-July period, supported by new capacity from the ramp-up of Plaquemines LNG and the Corpus Christi Midscale expansion, as well as higher volumes from Freeport LNG following last year's hurricane-related shutdown. Qatar's exports increased modestly by 1.3 MT, while both Australia and Russia saw volumes fall by around 5%. Russia's LNG exports hit their lowest level since 2021, mainly due to reduced liftings from the recently sanctioned Baltic LNG terminals at Portovaya and Vysotsk.
Shipbrokers report that seventeen newbuild LNG carriers were delivered in Q2-2025, bringing the total for the first half of the year to 33 units. This suggests that another ~65 vessels are scheduled for delivery during the remainder of 2025, including nine Arc-7 ice-class tankers originally contracted for the Arctic LNG-2 project. However, delays affecting these Arc-7 units reduce the expected deliveries for the rest of the year to about 55-60 vessels. This would place the projected newbuild total for 2025 in the high 80s, assuming some further slippage. The global LNG carrier orderbook is estimated at just short of 300 vessels, with around 30%, or 89 ships, on order at Chinese yards. Of the total orderbook, 25-30 units are uncommitted. A total of nine shipbuilding contracts for new LNG carriers have been announced YTD. While newbuilding prices are still assessed around $250 million, shipyard delivery slots at the Korean yards are now booked into the first half of 2028. The discount available for Chinese yard slots appears to be widening.
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Eight steam vessels have been confirmed sold for recycling so far this year, with several more currently being marketed for sale. The average age of these vessels is ~25 years, compared to an average of 29 years for the eight scrapped in 2024 and 37 years for the six scrapped in 2023. Given the weaker market environment, scrapping activity will likely accelerate throughout the remainder of the year.
June was notable for new LNG volume developments, as Canada joined the ranks of exporters, with LNG Canada shipping its first commercial cargo. This absorbed available tonnage out of the spot market. In the United States, Cheniere reached FID on Trains 8 and 9 at Corpus Christi, adding 3 MTPA of capacity with first LNG expected in 2028. This followed the late-April FID for Louisiana LNG, which will add 16.5 MTPA. In July, Venture Global sanctioned Phase 1 of CP2, with a targeted nameplate capacity of 14.5 MTPA. In addition, Argentina's Southern Energy reached FID for two FLNG units, with a combined capacity of 5.95 MTPA and operations planned for 2027. In the first half of 2025, long-term LNG sales and purchase agreements totalling 47.2 MTPA were signed - just short of the record 49 MTPA in H1-2024. This underlines the continued strong appetite for new LNG supply, with SPA activity expected to remain firm in the second half of the year.
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Second Quarter 2025 Results Presentation
Flex LNG will release its financial results for the second quarter 2025 on Wednesday August 20, 2025.
In connection with the earnings release, we will host a video webcast at 3:00 p.m. CEST (9:00 a.m. EST). In order to attend the webcast use the following link:
https://events.webcast.no/flexlng/IqCHF6PFRyOkoOhpdu6c/TG7JPihLSsWsN4antjjs
A Q&A session will be held after the conference/webcast. Information on how to submit questions will be given at the beginning of the session.
The presentation material which will be used in the conference/webcast can be downloaded on www.flexlng.com and replay details will also be available at this website. None of the information contained on the Company's website is incorporated into or forms a part of this report.
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FLEX LNG Ltd. published this content on August 20, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on August 20, 2025 at 10:16 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]