Q4 2025 Flex LNG Ltd Earnings Call

February 11, 2026

Speaker #1: Hi everybody. Welcome to Flex LNG's fourth quarter 2025 results presentation. My name is Marius Voss. I'm the CEO of Flex LNG, and today I'm joined with our CFO, Knut Traaholt, who will make us through the financial later in our presentation.

Marius Foss: Hi everybody. Welcome to Flex LNG's Q4 2025 results presentation. My name is Marius Foss. I am the CEO of Flex LNG. Today, I am joined with our CFO, Knut Traaholt, who will take us through the financials later in our presentation. Today, we will cover the Q4 and full year 2025 results, provide an update on the LNG shipping market. As always, we will conclude this webcast with a Q&A session. Before we start, we would like to highlight the following. We are using certain non-GAAP measures such as TCE, Adjusted EBITDA, and Adjusted Net Income. These are supplements to the earnings report reported in accordance with US GAAP. The reconciliation of these non-GAAP measures is available in the Q4 earnings report. There are also limitations to the completeness of our presentation. Therefore, we encourage you to read the quarterly report together with this presentation.

Speaker #1: Today we will cover the Q4 and full year 2025 results. Provide an update on the LNG shipping market. As always, we will conclude this webcast with a Q&A session.

Knut Traaholt: Before we start, we would like to highlight the following. We are using certain non-GAAP measures such as TCE, Adjusted EBITDA, and Adjusted Net Income. These are supplements to the earnings report reported in accordance with US GAAP. The reconciliation of these non-GAAP measures is available in the Q4 earnings report. There are also limitations to the completeness of our presentation. Therefore, we encourage you to read the quarterly report together with this presentation.

Speaker #1: And before we start, we would like to highlight the following: we are using certain non-gap measures such as TCE, adjusted EBITDA, and adjusted net income.

Speaker #1: These are supplements to the earnings report reported in accordance with the US gap. The reconciliation of these non-gap measures is available in the Q4 earnings report.

Speaker #1: There are also limitations to the completeness of the presentation. Therefore, we encourage you to read the quarterly report together with this presentation. And with that, let's begin and back to you, Marius.

Marius Foss: With that, let us begin. Back to you, Marius. We sailed in revenues of $87.5 million, or $85 million excluding the EU related to emissions trading system. The fleet averaged TCE during Q4 ended up at $70,100 per day. Net income for Q4 came in at $21.6 million, implying an earnings per share of $0.40. When adjusting for annualized losses and interest rate swap and FX, ending up with adjusted net income of $23.3 million, or adjusted earnings per share of $0.43. We completed the drydock of Flex Volunteer in January. She is now trading in the spot market. We received a notice from Cheniere that they will not declare the one-year options on the good vessel Flex Aurora. We expect to have her back in our fleet in March.

Knut Traaholt: With that, let us begin. Back to you, Marius.

Marius Foss: We sailed in revenues of $87.5 million, or $85 million excluding the EU related to emissions trading system. The fleet averaged TCE during Q4 ended up at $70,100 per day. Net income for Q4 came in at $21.6 million, implying an earnings per share of $0.40. When adjusting for annualized losses and interest rate swap and FX, ending up with adjusted net income of $23.3 million, or adjusted earnings per share of $0.43. We completed the drydock of Flex Volunteer in January. She is now trading in the spot market. We received a notice from Cheniere that they will not declare the one-year options on the good vessel Flex Aurora. We expect to have her back in our fleet in March.

Speaker #1: We sail in revenues of 87.5 million dollars or 85 million excluding the US related EU emission trading system. The fleet average TCE during the quarter ended up at 70,100 dollars per day.

Speaker #1: Net income for the fourth quarter came in at 21.6 million implying an earnings per share at 40 cents. When adjusting for analyzed losses and interest rate swap and effects ending up with adjusted net income of 23.3 million or adjusted earnings per share of 43 cents.

Speaker #1: We completed the dry dock of Flex Volunteer in January; she is now trading in the spot market. We received a notice from a one-hour charter that they will not declare the one-year options on the good vessel Flex Aurora, and we expect to have her back in our fleet in March.

Speaker #1: Our spot exposure in 2026 is limited to three vessels. Flex Volunteer, Flex Aurora, and the Flex Artemis are all three vessels marked for long-term contracts.

Marius Foss: Our spot exposure in 2026 is limited to three vessels: Flex Volunteer, Flex Aurora, and the Flex Artemis. All three vessels are marked for long-term contracts. The remaining ten vessels are on time charters. We are today presenting guidance for the full year. With three vessels in the spot market, we are presenting wide ranges reflecting exposure to the volatile spot markets. We expect full-year revenues to be between $310 million and $340 million. We expect a TCE per day of around $65,000 to $75,000 per day. Adjusted EBITDA is expected to come in at around $225 million to $255 million for the full year. The Flex LNG has a very robust financial position. We are with a cash balance of $448 million at the year-end. No debt matures prior to 2029. We have a solid contract backlog.

Speaker #1: The remaining ten vessels are on time charters. We are today presenting guidance for the full year, and with three vessels in the spot market, we are presenting wide ranges reflecting exposure to the volatile spot markets.

Speaker #1: We expect full-year revenues to be between 310 and 340 million, and we expect the TCE per day around 65 to 75 thousand dollars per day.

Speaker #1: Adjusted EBITDA is expected to come in at around 225 to 255 million dollars for the full year. The Flex LNG has a very robust financial position.

Speaker #1: We are with a cash balance of 448 million at the year end. No debt matures prior to 2029, and we have a solid contract backlog.

Speaker #1: The board has declared another 75 cents per share dividend. This is the 18th consecutive dividend of 75 cents per share, and we have distributed then around 770 million dollars since 2021.

Marius Foss: The board has declared another $0.75 per share dividend. This is the 18th consecutive dividend of $0.75 per share. We have distributed them around $770 million since 2021. Our last 12 months' dividend is $3 per share, implying a dividend yield of approximately 11.5%. When looking at the 2025 figures, the short summary is that we delivered in line with our guidance. The full-year TCE ended at $72,000 per day. We sailed in revenues of $340 million. Our adjusted EBITDA came in at $251 million. We traded two vessels in the spot market in 2025: the Flex Artemis and the Flex Constellation. We completed four drydockings in 2025: Flex Aurora and Flex Resolute in Q2, Flex Amber and Flex Artemis in Q3. With that, let us have a look at our contract backlog. In 2026, we have 78% of available days fixed on long-term charters.

Speaker #1: Our last 12 months dividend is three dollars per share, implying a dividend yield of approximately 11.5%. When looking at the 2025 figures, the short summary is that we delivered in line with our guidance.

Speaker #1: The full-year TCE ended at 72 thousand dollars per day, and we sail in revenues of 340 million. Our adjusted EBITDA came in at 251 million dollars.

Speaker #1: We traded two vessels in the spot market in 2025: the Flex Artemis and the Flex Constellation. And we completed four dry dockings in 2025.

Speaker #1: Flex Aurora and Flex Resolute in Q2, Flex Amber and Flex Artemis in Q3. With that, let's have a look at our contract backlog. In 2026, we have 78% of available days fixed on long-term charters.

Speaker #1: As you can see in the bottom of this slide, Flex Artemis and Flex Volunteer are now trading in the spot market, while Flex Aurora will be redelivered from her current charters in March.

Marius Foss: As you can see in the bottom of this slide, Flex Artemis and Flex Volunteer are now trading in the spot market, while Flex Aurora will be redelivered from her current charters in March. We are actively marketing all three vessels for both spot and long-term contracts. Further, in 2027, we have options for Flex Resolute, Flex Courageous, and Flex Freedom. These options are due to be declared during this year. The spot market was a roller coaster last year with soft rates in the start of the year, while we saw a rally in Q4 with spot fixtures for modern two-strokes reaching up to $175,000 per day. We expect 2026 to be an equally volatile and active market with many fixtures. There are a lot of new LNG export volumes ramping up, continued geopolitical uncertainties, and potential congestions both at import and export terminals.

Speaker #1: We are actively marketing all three vessels for both spot and long-term contracts. Further, in 2027, we have options for Flex Resolute, Flex Courageous, and Flex Freedom.

Speaker #1: These options are due to be declared during this year. The spot market was a roller coaster last year with soft rates in the start of the year while we saw a rally in Q4 with spot fixtures for more than two strokes reaching up to 175 thousand dollars per day.

Speaker #1: We expect 2026 to be equally volatile and active market with many fixtures. There is a lot of new LNG export volumes ramping up, continued geopolitical uncertainties potential congestions both at import and export terminals, but at the same time, there is also a lot of new buildings being delivered.

Marius Foss: But at the same time, there are also a lot of new buildings being delivered. Therefore, we have modest expectations for the earnings from our spot exposed vessel this year. Flex Constellation is due to complete her final voyage in March before she will commence her 15-year time charter delivered in direct continuation. Looking at our total contract coverage, we have today 50 years of minimum firm backlog, which may grow up to 75 years if the charters declare all the options attached. We are optimistic about our open exposure later in this decade. We have greater open exposure during this period, which aligns well with our expectations of an attractive shipping market. Significant new supply volumes are set to come on stream, creating strong market fundamentals. Let us have a look at the guidance for 2026. We expect full-year revenues to be between $310 million and $340 million.

Speaker #1: Therefore, we have a modest expectations for the earnings from our spot exposures exposed vessel this year. Flex Constellation is due to complete her final voyage in March.

Speaker #1: Before she will commence her 15-year time charter, delivered in direct continuation. Looking at our total contract coverage, we have today 50 years of minimum firm backlog, which may grow up to 75 years if the charters declare all the options attached.

Speaker #1: We are optimistic about our open exposure later in this decade. We have greater open exposure during this period, which aligns well with our expectations of an attractive shipping market.

Speaker #1: Significant new supply volumes are set to come on stream, creating strong market fundamentals. Let's have a look at the guiding for 2026. We expect full-year revenues to be between 310 and 340 million.

Speaker #1: And correspondingly, we expect the TCE for 65 to 75 thousand dollars per day. The range in revenues and TCE reflect our open position and exposure to the volatile spot markets.

Marius Foss: Correspondingly, we expect the TCE for 2026 to be around $65,000 to $75,000 per day. The range in revenues and TCE reflects our open position and exposure to the volatile spot markets. Adjusted EBITDA is expected to come in around $225 million to $255 million for the full year. In addition, we will complete three drydockings in 2026. The drydocking of the Flex Volunteer was completed in January. While Flex Freedom will enter drydock later in February, Flex Vigilant is expected to drydock in Q2. We have budgeted around 20 days off-hire on average and the average cost of $5.9 million per docking. Before handing over to Knut, I want to touch base on the key factors behind the dividend decision. Most of our decision indicators are dark green with a few exceptions.

Speaker #1: Adjusted EBITDA is expected to come in around 225 to 255 million dollars for the full year. In addition, we will complete three dry dockings in 2026.

Speaker #1: The docking of the Flex Volunteer was completed in January, while Flex Freedom will enter dry dock later in February. Flex Vigilant is expected to dry dock in Q2.

Speaker #1: We have budget around 20 days of fire on average, and the average cost of 5.9 million dollars per docking. Before handing over to Knut, I want to touch base on the key factors behind the dividend decision.

Speaker #1: Most of our decision indicators are dark green with a few exceptions. Earnings and cash flow. We have adjusted this to a lighter green reflecting more open exposure.

Marius Foss: Earnings and cash flow: We have adjusted this to a lighter green, reflecting more open exposure. Market outlook: We maintain orange level. The supply of new LNG volumes is firm. But there are simply too many ships delivered ahead of the new volumes. The long-term outlook is, however, very optimistic. Backlog and visibility: Even though we have a comfortable 50 years of minimum firm backlog, it is prudent to maintain light green. Based on these factors, the board has declared another quarterly dividend of $0.75 per share. The dividend will be paid out on or about 12 March for shareholders on record 27 February. With that, I hand it back to you, Knut, for a walkthrough through the financials.

Speaker #1: Market outlook. We maintain orange level the supply of new LNG volumes is firm, but there are simply too many ships being delivered ahead of the new volumes.

Speaker #1: The long-term outlook is, however, very optimistic. Backlog and visibility. Even though we have a comfortable 50 years of minimum firm backlog, it is prudent to maintain light green.

Speaker #1: Based on these factors, the board has declared another quarterly dividend of 75 cents per share. The dividend will be paid out on or about 12th of March for shareholders on record 27th of February.

Speaker #1: And with that, I hand it back to you, Knut, for a walkthrough through the financials. Thank you, Marius. In 2025, we had strong operational performance with close to 100% technical uptime, net of the days for dry dockings of our four vessels.

Knut Traaholt: Thank you, Marius. In 2025, we had strong operational performance with close to 100% technical uptime, net of the days for drydockings of our four vessels. The drydockings in 2025 were completed on 64 days in total, significantly below the budget at 80 days, and hence providing more available days for revenue generation. The TCE for the fourth quarter ended up at slightly above $70,000 per day, resulting in a TCE of $71,700 per day for the full year, and then on par with our guidance. OpEx for the fourth quarter was $16,600 per day. As you can see, higher than the previous quarters. This is due to planned and scheduled engine maintenance performed based on running hours. Hence, we performed more of this in the fourth quarter compared to the previous quarter.

Speaker #1: The dry dockings in 2025 was completed on 64 days in total, significantly below the budget at 80 days, and hence providing more available days for revenue generation.

Speaker #1: The TCE for the fourth quarter ended up at slightly above 70,000 dollars per day, resulting in a TCE of 71,700 per day for the full year, and then on par with our guidance.

Speaker #1: OPEX for the fourth quarter was 16,600 per day, and as you can see, higher than the previous quarters. This is due to planned and scheduled engine maintenance performed based on running hours.

Speaker #1: Hence, we performed more of this in the fourth quarter compared to previous quarter. For the full year, OPEX per day was 15,800 and slightly above our guided level of 15,500 per day.

Knut Traaholt: For the full year, OpEx per day was $15,800 and slightly above our guided level of $15,500 per day. For 2026, we budget OpEx per day to be $16,000. The increase is primarily driven by technical expenses for scheduled maintenance and cost inflation, in particular related to crew changes. In summary, the fourth quarter revenues net of EUAs for the EU emissions trading system were $85 million and $340 million for the full year. The $15 million reduction year-on-year is primarily explained by higher market exposure with Flex Constellation and Flex Artemis trading in the softer spot market. Adjusted EBITDA and adjusted net income for the full year ended up at $251 million and $101 million, respectively. This is fully in line with our guidance provided earlier last year.

Speaker #1: For 2026, we budget OPEX per day to be 16,000. The increase is primarily driven by technical expenses for scheduled maintenance and cost inflation in particular related to crew changes.

Speaker #1: In summary, the fourth quarter revenues net of EUAs for EU emissions trading system was 85 million. And 340 million for the full year. The 15 million reduction year on year is primarily explained by higher market exposure with Flex Constellation and Flex Artemis trading in a softer spot market.

Speaker #1: Adjusted EBITDA and adjusted net income for the full year ended up at 251 million, and 101 million respectively. This is fully in line with our guidance provided earlier last year.

Speaker #1: As a reminder, in our adjusted number, we adjust for unrealized gains and losses from the interest swap interest rate swap portfolio, FX, and write-offs of debt issuance costs and excess fees, related to the three refinancings completed last year.

Knut Traaholt: As a reminder, in our adjusted number, we adjust for unrealized gains and losses from the interest rate swap portfolio, FX, and write-offs of debt issues costs and exit fees related to the three refinancings completed last year. We generated cash flow of $44 million from operations. And net of working capital movements and drydocking expenditures, we generated approximately $36 million in net operating cash flow. We repaid $27 million in scheduled debt installments and distributed $41 million to our shareholders. In sum, our cash position was reduced with $31 million. This left us with a robust cash balance of $448 million at the end of the year. In addition to our cash position of $448 million, we maintain a Book Equity Ratio of 27%. As noted before, our book values reflect the historical low acquisition cost and then adjusted with the regular depreciations.

Speaker #1: We generated cash flow of 44 million from operations. And net of working capital movements and dry docking expenditures, we generated approximately 36 million in net operating cash flow.

Speaker #1: We repaid 27 million in scheduled debt installments and distributed 41 million to our shareholders. In sum, our cash position was reduced with 31 million.

Speaker #1: This left us with a robust cash balance of 448 million at the end of the year. In addition to our cash position of 448 million, we maintain a book equity ratio of 27%.

Speaker #1: As noted before, our book values reflect the historical low acquisition cost and then adjusted with the regular depreciations. We have also an interest rate swap portfolio for interest rate hedging, which is valued at 17.5 million on the balance sheet.

Knut Traaholt: We have also an interest rate swap portfolio for interest rate hedging, which is valued at $17.5 million on the balance sheet. The average fixed rate of this interest rate swap portfolio is fixed at 2.5%. We expect to maintain a hedge ratio of around 70% into mid-2027. Since January 2021, this swap portfolio has generated unrealized and realized gains of around $132 million. With that, I hand it back to you, Marius, for the market section.

Speaker #1: The average fixed rate of this interest rate swap portfolio is fixed at 2.5%, and we expect to maintain a hedge ratio of around 70% into mid-2027.

Speaker #1: And since January 2021, this swap portfolio has generated unrealized and realized gains of around 132 million. And with that, I hand it back to you, Marius, for the market section.

Speaker #1: Thank you, Knut. Well done. This robust financial position provides us with highly commercial and financial flexibility going forward. Summarizing the export volumes for 2025, it was a year of growth for LNG, with Europe clearly leading the demand.

Marius Foss: Thank you, Knut. Well done. This robust financial position provides us highly commercial and financial flexibility going forward. Summarizing the export volumes for 2025, it was a year of growth for LNG, with Europe clearly leading the demand. Global energy export rose 4% year-over-year for around 429 million tons, driven by strong US growth up to 25% versus 2024. The rapid ramp-up from Plaquemines LNG, combined with new supply from Corpus Christi, accounted for the majority net growth in the US. Outside North America, new volumes additional were limited, while Russia LNG export declined 2 million tons, largely due to sanctions. Australia saw a large decline due to heavy maintenance. On the demand side, Europe absorbed the majority of the increased volumes with imports up to 24% year-over-year, reinforcing its role as a key balancing market. Asia, on the other hand, was more mixed.

Speaker #1: Global LNG export rose 4% on a year-to-year for around 429 million tons, driven by strong US growth up to 25% versus 24%. The rapid ramp-up from Plaquemin LNG combined with new supply from Corpus Christi accounted to the majority net growth in the US.

Speaker #1: Outside North America, new volumes, additional, were limited, while Russia LNG export declined 2 million tons, largely due to sanctions. Australia, so a large decline due to heavy maintenance.

Speaker #1: On the demand side, Europe absorbed the majority of the increased volumes with imports up to 24% year-to-year, reinforcing its role as a key balancing market.

Speaker #1: Asia, on the other hand, was more mixed, fast-growing markets such as China and India saw reduced import year-to-year, in 2025 China reduced its imports with 15% from 2024.

Marius Foss: Fast-growing markets such as China and India saw reduced imports year-over-year. In 2025, China reduced its imports with 15% from 2024 and relied more on domestic production, increased pipeline imports, especially from the Power of Siberia pipeline. This is also impacted by the geopolitical events and the trade war with the US. India is typically a price-sensitive LNG importer. And while JKM traded above the $10 mark, India tends to import more LPG. On the more mature LNG market, Japan, South Korea, and Taiwan, LNG imports were, in sum, unchanged from 2024. The US supplied most of the new volumes in Europe in 2025. Europe has effectively switched its reliance from Russian pipeline flows to the US LNG. The explanation of the big jump in LNG imports in 2025 is clear on the right-hand side of this slide.

Speaker #1: And relied more on domestic production increased pipeline imports, especially from the power of Siberia pipeline. This is also impacted by the geopolitical events and the trade war with the US.

Speaker #1: India is typically a price-sensitive LNG importer and while JKM traded about a $10 mark, India tends to import more LPG. On the more mature LNG market, Japan-South Korean-Taiwan LNG imports were in some unchanged from 2024.

Speaker #1: The US supply most of the new volumes in Europe in 2025, and Europe has effect switched its reliance from Russian pipeline flows with the US LNG.

Speaker #1: The explanation of the big jump in LNG imports in 2025 is clear on the rate on the right-hand side of this slide. European gas storage levels entered 2026 well below normal and are now said to be around 40%.

Marius Foss: European gas storage levels entered 2026 well below normal and are now said to be around 40%, at the risk to fall to levels not seen since 2022. If Europe ends the winter with low storage levels, a huge amount of gas will be needed to be injected to return stock to minimal levels ahead of next winter. Most are used to meet daily demand. Europe's total buying requirements in the coming months could be enormous. Hence, we expect strong demand pull from Europe. As long as Europe will maintain a high demand in 2026, there will be fewer intra-basin voyages, putting a lid on the spot market. This is also reflected in the expectation for 2026 spot rates. However, the third wave of LNG supply is underway.

Speaker #1: At the risk to fall to levels not seen since 2022. If Europe ends the winter with low storage levels, huge amount of gas will be needed to inject it to the return stock to minimal levels ahead of next winter.

Speaker #1: Most are used to meet daily demand, so Europe's totally buying requirements in the coming months could be enormous. Hence, we expect strong demand pull from Europe.

Speaker #1: As long as Europe will maintain a high demand in 2026, there will be fewer intrabasin voyages putting a lid on the spot market. This is also reflected in the expectation for 2026 spot rates.

Speaker #1: However, the third wave of LNG supply is underway, and we saw in Q2 last year ramp-up of new export capacity can suddenly absorb a lot of tonage in short time.

Marius Foss: We saw in Q2 last year a ramp-up of new export capacity that can suddenly absorb a lot of tonnage in a short time. This is very well illustrated in the ramp-up of LNG Canada, which moved a lot of tonnage away into the Pacific Basin. Total new building orders in 2025 were 35, down from 79 in 2024. Ordering momentum has carried over in 2026 with around 20 new building orders recorded as early as February. Vessels ordered in 2025-2026 are scheduled for delivery late 2027 or 2029. A meaningful share of these orders remain without attached contracts. This signals growing confidence in a firm shipping market later in this decade, a period that aligns well with our open exposure. The new building prices remain fairly stable at $250 million for a standard two-stroke vessel built in Korea.

Speaker #1: This is very well illustrated in the ramp-up of LNG Canada, which moved a lot of tonage away into the Pacific basin. Total new building orders in 2025 was 35, down from 79 in 2024.

Speaker #1: Ordering momentum has carried out in 2026 with around 20 new building orders record as early in February. Vessels order in 2025-2006 are scheduled for delivery late 2025 or 2029.

Speaker #1: A meaningful share of these orders remain without attached contracts. This signals growing confidence in a firm shipping market later in this decade. A period that aligns well with our open exposure.

Speaker #1: The new building prices remain fairly stable for 250 million dollars for a standard two-stroke vessel built in Korea. This is supportive for assets values for existing tonnage, including our fleet.

Marius Foss: This is supportive for asset values for existing tonnage, including our fleet. We do not expect new building prices to fall materially anytime soon. 23 new buildings were delivered in Q4 2025, bringing the total deliveries up to 79, up from 60 in 2024. With 6 vessels already delivered this year, the remaining order book is estimated to be around 290 vessels, equivalent to around 40% of the existing fleet. 90 to 95 vessels are expected to be delivered in 2026, including roughly 20 units that slipped from 2025. Of the total order book, approximately 45 vessels are currently uncommitted. This profile means that while there will be a lot of new tonnage entering the market in 2026 and 2027.

Speaker #1: We do not expect new building prices to fall materially anytime soon. 23 new buildings were delivered in the fourth quarter 2025, bringing a total deliveries up to 79, up from 60 in 2024.

Speaker #1: With six vessels already delivered this year, the remaining order book is estimated to around 290 vessels, equivalent to around 40% of the existing fleet.

Speaker #1: 90 to 95 vessels are expected to be delivered in 2026, including roughly 20 units that slipped from 2025. Of the total order book, approximately 45 vessels are currently uncommitted.

Speaker #1: This profile means that while there will be a lot of new tonnage entering the market in 2026 and 2027, with a lot of new modern tonnage entering the market, the steam vessels rolling off long-term contracts—we saw a record high of 15 steam vessels scrapped in 2025.

Marius Foss: With a lot of new modern tonnage entering the market, the steam vessels rolling off long-term contracts, we saw a record high of 15 steam vessels scrapped in 2025. This is a strong signal. We expect recycling activity to continue. Spot rates for steam vessels are quoted currently under $5,000 per day, effectively pushing these vessels out of the market. The shipbroker SSY believes close to 100 steam vessels will roll off their long contracts over the coming years. These vessels are expected to exit the active trade, either scrapped or enter into regional trades. This slide shows the three waves of global LNG capacity and why the period we are now entering really matters. We are entering the third wave of LNG. It's larger than ever seen before.

Speaker #1: This is a strong signal. We expect recycling activity to continue spot rates to steam vessels are quoted currently under $5,000 per day, effectively pushing these vessels out of the market.

Speaker #1: The shipbroker SSY believes close to 100 steam vessels will roll off their long contracts over the coming years. And these vessels are expected to exit the active trade either scrapped or enter into regional trades.

Speaker #1: This slide shows the three waves of global LNG capacity and why the period we are now entering really matters. We are entering the third wave of LNG, and it's larger than ever seen before.

Speaker #1: Over 200 million tons of new export capacity is expected to come on stream, or around 50% growth in the global liquefaction capacity. Most of this growth is concentrated in two places.

Marius Foss: Over 200 million tons of new export capacity is expected to come on stream, or around 50% growth in the global liquefaction capacity. Most of this growth is concentrated in two places: North America and Qatar. Qatar North Field East is expected to begin deliveries late this year, with new trains coming online thereafter. In addition, LNG Canada will continue to ramp up towards full capacity in 2026, alongside increased output from Corpus Christi in the US. This widely anticipated startup of Golden Pass LNG is expected later in 2026, providing a further boost of US liquefaction capacity. With that, let's move on to the Q&A session.

Speaker #1: The North America and Qatar. Qatar North Field East is expected to begin deliveries late this year, with new trains coming online thereafter. In addition, LNG Canada will continue to ramp up towards full capacity in 2026, alongside increased output from Corpus Christi in the US.

Speaker #1: The widely anticipated startup of Golden Pass LNG is expected later in 2026, providing a further boost to U.S. liquefaction capacity. With that, let's move on to the Q&A session.

Speaker #1: Thank you, Marius. That hands us over to the Q&A sessions, and questions that have been submitted. And thank you for all of those who have sent us questions for this quarterly presentation.

[Company Representative] (Flex LNG): Thank you, Marius. That hands us over to the Q&A sessions and questions that have been submitted. Thank you for all of those who have sent us questions for this quarterly presentation. There are a number of questions regarding the upcoming options that you walked through in the fleet overview. Can you give any more color around these options and the likelihood of being declared?

Marius Foss: Thank you, Marius. That hands us over to the Q&A sessions and questions that have been submitted. Thank you for all of those who have sent us questions for this quarterly presentation. There are a number of questions regarding the upcoming options that you walked through in the fleet overview. Can you give any more color around these options and the likelihood of being declared?

Speaker #1: There's a number of questions regarding the upcoming options that you walked through in the fleet overview. Can you give any more color of around these options and the likelihood of being declared?

Speaker #1: Thank you. That's a good question. We are also waiting for that. I can't really comment on when these options are due, but the charters will do so during 2026.

Marius Foss: Thank you. That's a good question. We are also waiting for that. I can't really comment on when these options are due. But the charters will do so during 2026. Regardless if they are declared or not, these options will not have any effect with our fleet portfolio of 75% in 2026. So we all have seen in our presentation that 2027 and 2028 are an interesting period with increased volumes. So, yeah, it's interesting to see if the charters are sharing the same as we have shared in this presentation today or not. So we will report back when these options are due and inform the market accordingly.

Speaker #1: Regardless, if they are declared or not, these options will not have any effect with our fleet portfolio of 75% in 2026. So we all have seen in our presentation 2027 and 2028 is an interesting period with the increased volumes.

Speaker #1: So it's yeah, we also interesting to see if the charters are sharing the same as we have shared in this presentation today or not.

Speaker #1: So we will report back when these options are due and inform the market accordingly. And now with Flex LNG being redelivered and we have increased market exposure, there are also a number of questions on the decision factors and how this should be viewed regarding future dividend payments.

[Company Representative] (Flex LNG): And now, with Flex Aurora being redelivered and we have increased market exposure, there are also a number of questions on the decision factors and how this should be viewed regarding future dividend payments. I think we can start off with saying that each dividend payment is a decision made by the board at each board meeting ahead of the quarterly presentation. So it's difficult to say something about the future of dividends. But what we can say is on the decision factors, yes, we have adjusted some. But the majority of the decision factors are dark green or light green. In the decision, it's important here to view that we have a very solid financial position with a high cash balance to support the dividend. And we also have a large contract backlog, which are not subject to options being declared or not.

Knut Traaholt: And now, with Flex Aurora being redelivered and we have increased market exposure, there are also a number of questions on the decision factors and how this should be viewed regarding future dividend payments. I think we can start off with saying that each dividend payment is a decision made by the board at each board meeting ahead of the quarterly presentation. So it's difficult to say something about the future of dividends. But what we can say is on the decision factors, yes, we have adjusted some. But the majority of the decision factors are dark green or light green. In the decision, it's important here to view that we have a very solid financial position with a high cash balance to support the dividend. And we also have a large contract backlog, which are not subject to options being declared or not.

Speaker #1: I think we can start off with saying that each dividend payment is a decision made by the board, by each at each board meeting ahead of the quarterly presentation.

Speaker #1: So there's difficult to say something about the future of dividends, but what we can say is on the decision factors, yes, we have adjusted some, but the majority of the decision factors are dark green or light green.

Speaker #1: In the decision, it's important here to view that we have a very solid financial position with a high cash balance to support the also have a large contract backlog, which are not subject to options being declared or not.

Speaker #1: One thing that we are monitoring and will be assisted in evaluating for future decision factors will be the visibility—in particular, the visibility in trading, in particular the trading of the spot, also vessels—and if any of these open ships will get another long-term contract.

[Company Representative] (Flex LNG): One thing that we are monitoring and will be assisted in evaluating future decision factors will be the visibility, in particular, the trading of the spot vessels, and also if any of these open ships will get another long-term contract. There are also a number of questions here on new buildings and the recent surge in new building orders, in particular, in the start of the year, and on Flex and on fleet growth. Do you consider new buildings similar to these owners?

Knut Traaholt: One thing that we are monitoring and will be assisted in evaluating future decision factors will be the visibility, in particular, the trading of the spot vessels, and also if any of these open ships will get another long-term contract. There are also a number of questions here on new buildings and the recent surge in new building orders, in particular, in the start of the year, and on Flex and on fleet growth. Do you consider new buildings similar to these owners?

Speaker #1: There are also a number of questions here on new buildings and the recent surge in new orders , in building particular in the south of the year and on flex and on fleet growth .

Speaker #1: Do you consider new buildings similar to these owners ? Thank you . With what you have explained now with the in , we to order position we are are in position ship .

Marius Foss: Thank you. With what you have explained now, with the position we are in, we are in position to order ship if needed. But we are trying to be, say, disciplined and not to order if we don't have a contract attached. As explained in our presentation now, is that the new building in modern Two-Stroke today is about $250 million. And the benchmark for a 10-year contract is, say, $85,000, a give and take. And in our calculations, that's not really a good investment for a ship owner. So we are trying to be patient, disciplined, and also working with our charters that if new buildings should be needed, we are ready to go to the yard and discuss new contracts with our charters if somebody wants to support with us. But speculatively, we see others are ordering that. And that's a good sign of where we are heading.

Speaker #1: If needed . But we are trying to be , say , disciplined not to order if we don't have a contract attached , as explained in our presentation .

Speaker #1: Now , is that a new building in modern two stroke today is about $250 million , and the benchmark for a ten year contract is , say , $85,000 .

Speaker #1: A give and take . And in our calculations , that's not a really a good investment for a ship owner . So we are trying to be patient , disciplined and also working with our charters that if new buildings should be needed , we are ready to go to the yard and discuss new contracts with our charters .

Speaker #1: If somebody wants to port with us, but speculatively we see others are ordering that, and that's a good sign of where we are heading.

Marius Foss: I think the exposure we have with the current open ships coming open later will mean that we are in a very good position to get these ships extended or new contracts.

Speaker #1: I think the exposure we have with the current open ships coming open later is , will are in very good position to get these ships extended or new contracts .

[Company Representative] (Flex LNG): Yeah, there is a follow-up comment to that to support that. Will we order ships, new buildings, while we have nearly half of the fleet exposed in the market for 2028, 2029?

Knut Traaholt: Yeah, there is a follow-up comment to that to support that. Will we order ships, new buildings, while we have nearly half of the fleet exposed in the market for 2028, 2029?

Speaker #1: Yeah , that follow comment . That's support to that . There is . Will we order ships new buildings while we have nearly half of the fleet in exposed the market for 2829 ?

Marius Foss: No, I think we should take the benefit of what we have on the water, which still is considered as a new building. Basically, the entire fleet has been through a five-year service. I believe all our ships live in drydocks now or are better than new. I think we have good-quality tonnage, which the size is in line with the new orders. We will focus on that first. Stay disciplined.

Speaker #1: No , I think should we take the benefit of what we have on the water , which still is considered as new building .

Speaker #1: They have now a basically the entire fleet has been through a five year service , and I believe all our live ships in dry now are better than you .

Speaker #1: So I think we have a good quality tonnage , which the size is in line with the new orders . So we will focus on that .

[Company Representative] (Flex LNG): That covers the main topics of the questions we received today. That concludes the Q&A session.

Speaker #1: First , stay disciplined and that covers the main topics of the questions we received today . So that concludes the Q&A session . Thank you .

Knut Traaholt: That covers the main topics of the questions we received today. That concludes the Q&A session.

Marius Foss: Thank you, Knut. Thank you for all joining in to our webcast today. We would like to welcome you all back to our Q1 2026 presentation, which will be back in May. Thank you.

Speaker #1: Thank you for all joining into our webcast today . We would like to welcome back to you all our Q1 2026 presentation , which will be back in May .

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