FLEX LNG Ltd. (FLNG): Business Model Canvas [Dec-2025 Updated]

You're looking to cut through the noise on the liquefied natural gas shipping sector, and honestly, the business model for the company we're analyzing right now is elegantly simple: lock up a young, high-spec fleet on decade-long contracts. As a former head analyst, I can tell you this strategy translates directly into the numbers you see for late 2025: a fleet of thirteen modern carriers backed by a contract backlog stretching over 53 years of minimum employment, underpinning revenue guidance around $340 million for the year. They are selling capacity assurance, not just spot capacity. It's a capital-intensive game, but the long-term Time Charter Equivalent (TCE) rates, hovering near $71,000 to $72,000 per day, show why this model works for predictable cash flow. Dive into the nine blocks below to see exactly how they structure these deals and manage the associated costs.

FLEX LNG Ltd. (FLNG) - Canvas Business Model: Key Partnerships

You're looking at the core relationships that keep FLEX LNG Ltd. (FLNG) running and financed, which is critical in this capital-intensive sector. These partnerships are where the big money moves happen and where the physical assets get built and maintained. Let's break down the key players as of late 2025.

Financial institutions for large-scale debt and refinancing

FLEX LNG Ltd. (FLNG) actively partners with financial institutions to manage its balance sheet, extending maturities and optimizing financing costs. A prime example from 2025 is the $180 million term loan facility signed in July 2025 for the vessel Flex Constellation, which was drawn down in September 2025. This facility carries an interest rate of SOFR plus a margin of 165 basis points and has a 15.5-year tenor. This was part of the broader Balance Sheet Optimization Program 3.0, which delivered a total of $530 million in new financings throughout 2025, releasing $137 million in net proceeds. At the end of the third quarter of 2025, FLEX LNG Ltd. (FLNG) recorded an all-time high cash balance of $479 million.

Here's a look at the major financing events in 2025:

Shipyards for newbuild vessel construction and delivery

The physical assets come from specialized shipyards. For instance, the 173,400 cu m LNG carrier named Flex Artemis is being built at South Korea's Daewoo Shipbuilding & Marine Engineering yard. While the prompt mentions Hanwha Ocean, their 2025 activity included securing an order for seven LNG dual-fuel propulsion container ships worth $1.4 billion from Yang Ming Marine, with deliveries scheduled through the first half of 2029.

Asian-based lease providers for sale and leaseback agreements

Sale and leaseback deals with Asian-based lease providers are a key part of FLEX LNG Ltd. (FLNG)'s strategy to unlock capital. The deal for Flex Resolute in September 2025 involved a sale for $175 million with a 10-year bareboat charter back. This mirrors the May 2025 transaction for Flex Courageous, which was also for $175.0 million with a 10-year bareboat charter back. These transactions are part of the Balance Sheet Optimization Program 3.0.

Technical managers and crewing agencies for global vessel operations

The operational backbone is managed by FLEX LNG Management AS. Key personnel include Marius Foss, appointed CEO effective December 5, 2025, who brings over 35 years of shipping experience. Knut Traaholt, the Chief Financial Officer, has about 20 years of experience in international shipping and finance. Naren Senaratne joined as Chief Accounting Officer in September 2024. Operationally, the company completed scheduled drydockings for two vessels during the third quarter of 2025:

• Flex Amber
• Flex Artemis

Classification societies and regulatory bodies for compliance

Compliance relies on classification societies and regulatory oversight. For example, the Oslo Stock Exchange (OSE) approved the delisting of FLEX LNG Ltd. (FLNG) stock, with the last day of listing being September 15, 2025.

FLEX LNG Ltd. (FLNG) - Canvas Business Model: Key Activities

You're looking at the core operational engine of FLEX LNG Ltd. (FLNG) as of late 2025, focusing on the hard numbers that drive their strategy.

Securing long-term Time Charter (TC) agreements with major energy players.

The focus here is locking in revenue visibility. As of the third quarter of 2025, FLEX LNG Ltd. reported a minimum firm charter backlog of 53 years. This backlog is extendable to 80 years if charterers exercise all available options, based on the latest updates. For the remainder of 2025, the firm contract coverage stood at 87.6% of available days. A key example of securing long-term commitment is the Flex Constellation, which is fully booked into 2041 via a 15-year time charter that commenced in the first half of 2026.

Managing a fleet of thirteen modern LNG carriers with 100.0% technical uptime.

FLEX LNG Ltd. operates a fleet consisting of thirteen modern LNG carriers. Operational excellence is a key metric, with the company achieving 100.0% technical uptime on its vessels in the first quarter of 2025. The fleet is characterized by its modern propulsion, utilizing the latest generation two-stroke technology (MEGI and X-DF). The operational performance in Q3 2025 yielded Vessel operating revenues of $85.7 million and an average Time Charter Equivalent (TCE) rate of $70,921 per day. The full-year 2025 TCE guidance was narrowed to approximately $71,000 to $72,000 per day.

Here's a quick look at the Q3 2025 financial snapshot:

Executing vessel dry-dockings and maintenance on schedule and budget.

Maintenance execution is critical for maintaining that high technical uptime. In the third quarter of 2025, FLEX LNG Ltd. successfully completed the scheduled dry-dockings for two specific vessels:

• Flex Amber
• Flex Artemis

Looking ahead, the plan for 2026 includes completing three more dry-dockings for:

• Flex Volunteer
• Flex Freedom
• Flex Vigilant

The Flex Volunteer is expected to be redelivered from its current charter in late December 2025, going straight into drydock for its five-year special survey.

Optimizing the balance sheet through refinancing programs (e.g., Program 3.0).

The Balance Sheet Optimization Program 3.0 was finalized in September 2025. This program delivered a total of $530 million in new financings during 2025 on attractive terms. The net result was the release of $137 million in net proceeds, contributing to an all-time high cash balance of $479 million as of the end of the third quarter. This activity also extended the next debt maturity to 2029.

Key components of the refinancing activity in 2025 included:

• Flex Constellation: Secured a $180 million term loan facility with a 15.5-year tenor.
• Flex Resolute: Completed a sale and leaseback agreement for a consideration of $175 million, including a 10-year bareboat charter back.

This follows the earlier completion of the Flex Courageous refinancing, which generated net proceeds of approximately $42 million from a $175 million JOLCO deal.

Ensuring compliance with EU Emissions Trading System (EU ETS) regulations.

Compliance activity is integrated into the revenue structure. For the third quarter of 2025, FLEX LNG Ltd. recorded $1.6 million in income related to European Union Allowances (EUAs) receivable from charterers under time charter contracts for voyages subject to the EU ETS. An equivalent amount was recorded under Voyage expenses for the same period. This is a consistent operational pass-through of the regulatory cost.

Finance: draft 13-week cash view by Friday.

FLEX LNG Ltd. (FLNG) - Canvas Business Model: Key Resources

You're looking at the core assets underpinning FLEX LNG Ltd.'s market position as of late 2025. These aren't just ships and bank balances; they are the tangible competitive advantages that secure future revenue.

The foundation of FLEX LNG Ltd.'s operations is its fleet. As of the third quarter of 2025, the company operates a fleet of exactly thirteen modern LNG carriers. What really matters here is the efficiency and environmental compliance of this tonnage, as every vessel employs the latest generation two-stroke propulsion technology, specifically either MEGI (M-type Electronically Controlled Gas Injection) or X-DF (Generation X Dual Fuel) systems. That's a fully modern, high-specification fleet ready for long-term charters. It's a clean, powerful asset base.

Here's a quick look at the fleet composition and contract strength as reported in the Q3 2025 results:

Financial resilience is another critical resource. FLEX LNG Ltd. achieved an all-time high cash balance of $479 million at the close of the third quarter of 2025. This strong liquidity position is further buttressed by the successful completion of the Balance Sheet Optimization Program 3.0 this year, which delivered $530 million in new financings and extended the next debt maturity wall out to 2029. Honestly, that level of cash, combined with long-dated debt maturities, gives you serious operational flexibility.

The human capital driving these assets is also a key resource. The company relies on its experienced commercial and technical management team to secure and maintain these high-value contracts and ensure operational excellence. This team is responsible for navigating the market to maximize utilization and secure favorable terms, as evidenced by the ongoing marketing efforts for open tonnage like the Flex Volunteer post-drydock in early 2026.

The operational performance metrics tied to this management expertise include:

• Reported Time Charter Equivalent (TCE) rate of $70,921 per day for Q3 2025.
• Guidance for full-year 2025 TCE per day in the range of $71,000-$72,000.
• Vessel Operating Expense (OPEX) guidance maintained around $15,500 per day for fiscal year 2025.

Finance: draft 13-week cash view by Friday.

FLEX LNG Ltd. (FLNG) - Canvas Business Model: Value Propositions

You're looking at the core reasons why charterers sign long, firm contracts with FLEX LNG Ltd. It's about modern hardware delivering quantifiable operational advantages, which translates directly into their earnings visibility.

High-efficiency LNG transportation via two-stroke engines for reduced fuel consumption

The value here is in the propulsion technology. FLEX LNG Ltd. operates a fleet of $\mathbf{13}$ state-of-the-art LNG carriers, all featuring the latest generation two-stroke propulsion, specifically MEGI and X-DF engines. This technology is a major differentiator when you compare it to the older fleet out there. For instance, the fuel consumption at service speed ($\mathbf{19.5}$ knots) for their modern vessels is reported at either $\mathbf{91}$ ton/day (DSME built) or $\mathbf{92}$ ton/day (SHI built). This is a significant step down from the older 2nd Generation steam turbine vessels, which consumed around $\sim\mathbf{190}$ tons/day. That difference in daily fuel burn is real money saved for the charterer over the life of the contract.

Long-term earnings stability and capacity assurance for charterers through TCs extending to 2041 and beyond

This is where the financial certainty comes in. You see this in the backlog figures. As of the Q1 2025 reporting period, $\mathbf{11.2}$ out of the $\mathbf{13}$ ships were already on firm Time Charter coverage for the following year, 2025. The minimum firm charter backlog stood at $\mathbf{62}$ years as of year-end 2024, which could extend to $\mathbf{96}$ years if all extension options are exercised. More recently, the new $\mathbf{15}$-year Time Charter secured for the Flex Constellation, commencing in 2026, pushes the total firm backlog to $\mathbf{64}$ years, with a potential total backlog of $\mathbf{98}$ years. This specific new contract matures in $\mathbf{2041}$, with an extension option available until $\mathbf{2043}$.

The average Time Charter Equivalent (TCE) rate for the firm backlog covering 2025 was near $\mathbf{\$80,000}$ per day. To be fair, the actual reported TCE for Q2 2025 was $\mathbf{\$72,012}$ per day, showing some near-term market softness, but the long-term contracts lock in strong rates.

Reduced carbon footprint and lower boil-off rates compared to older steam-powered vessels

The environmental profile of the fleet is a key proposition, especially given evolving regulations. The modern engine technology results in significantly lower boil-off rates. For example, some of their MEGI+PRS vessels report boil-off rates as low as $\mathbf{0.075\%}$, compared to the older steam vessels which saw rates between $\mathbf{0.20\%}$ and $\mathbf{0.25\%}$.

Regarding regulatory compliance, based on $\mathbf{2024}$ data, only $\mathbf{6\%}$ of FLEX LNG Ltd.'s fleet $\text{CO}_2$ emissions were exposed to the EU Emissions Trading Scheme (EU ETS). The company has a stated target of achieving net zero greenhouse gas emissions by $\mathbf{2040}$.

• Fleet consists of $\mathbf{13}$ vessels built between $\mathbf{2018}$ and $\mathbf{2021}$.
• Vessels use MEGI or X-DF propulsion systems.
• Lower boil-off means less cargo loss and lower emissions intensity.

Reliable service with high technical uptime for critical global energy supply chains

The value proposition here is simple: the ships are available when needed. You have $\mathbf{11.2}$ of the $\mathbf{13}$ vessels secured on firm contracts for the next year (2025), which speaks volumes about the reliability charterers place on the fleet. The company is focused on maintaining high technical uptime, which is critical when you are part of the global energy supply chain. For instance, in Q1 2025, vessel operating revenues were $\mathbf{\$88.4}$ million. The fleet size of $\mathbf{13}$ modern carriers ensures substantial capacity is ready for deployment under these long-term agreements. Finance: draft 13-week cash view by Friday.

FLEX LNG Ltd. (FLNG) - Canvas Business Model: Customer Relationships

You're looking at how FLEX LNG Ltd. locks in revenue visibility, which is key in the cyclical shipping world. The focus here is clearly on securing long-term commitments over chasing volatile spot rates.

Dedicated commercial management focused on long-term charter renewals

The strategy centers on maximizing the contracted revenue stream. As of the third quarter of 2025, FLEX LNG Ltd. maintained a robust contracted position, which provides exceptional earnings stability.

• Firm contract coverage was 87.6% for the remainder of 2025 (as of Q1 2025 data).
• 90% of income days for 2025 were already covered (as of late 2024/early 2025 data).
• The aggregate firm contract backlog for the fleet stood at 59 years based on earliest expirations (as of Q1 2025 data).
• This firm backlog could potentially increase to 98 years if all contracted options are exercised.
• 11.2 out of 13 vessels were on firm Time Charter as of late 2024/early 2025.

The average Time Charter Equivalent (TCE) rate for the fleet in Q3 2025 was $70,921 per day.

Relationship-driven model with returning customers, like the Supermajor charterer

The data shows a pattern of securing multi-year deals with specific counterparties, suggesting deep, established relationships. While a Supermajor isn't explicitly named, the deal with Southern Energy S.A. (SESA) for two vessels exemplifies this long-term commitment structure.

• Two separate 20-year charter agreements were signed for the FLNG Hilli and the MKII FLNG with SESA.
• These two agreements are expected to add $13.7 billion in earnings backlog to the counterparty over 20 years.
• The FLNG Hilli has an expected contract start-up in 2027 with a net charter hire of $285 million/y plus a commodity-linked tariff.
• The MKII FLNG has an expected contract start-up in 2028 with a net charter hire of $400 million/y plus a commodity-linked tariff.

The company also engages in asset-backed financing relationships, such as the sale and leaseback agreements. For instance, a bareboat charter back of 10 years was agreed upon for the Flex Resolute in September 2025 for a consideration of $175 million.

High-touch, direct negotiation for bespoke Time Charter Agreements

The rates achieved reflect the high specification of the fleet, which is equipped with MEGI or X-DF propulsion systems, giving charterers advantages in reduced fuel consumption. The negotiation results in specific, fixed-rate contracts.

Contractual relationships that include extension options, fostering multi-decade partnerships

The structure of these agreements is designed to create optionality for the charterer, which in turn secures a longer potential revenue stream for FLEX LNG Ltd. This is defintely a key part of the relationship management.

• The Flex Constellation 15-year Time Charter includes an extension option until 2043.
• The SESA agreements allow the charterer to reduce the term to 12 years for FLNG Hilli or 15 years for the MKII FLNG, subject to a three-year notice and payment of a fee.
• The total firm backlog of 64 years can potentially extend to 98 years when all extension options are included.

Finance: draft 13-week cash view by Friday.

FLEX LNG Ltd. (FLNG) - Canvas Business Model: Channels

You're looking at how FLEX LNG Ltd. connects its high-value asset base-its fleet of modern LNG carriers-with its customers and the capital markets. The channels here are about locking in long-term revenue visibility and managing the short-term market exposure.

Direct negotiation and execution of Time Charter Agreements (TCs)

The primary channel for FLEX LNG Ltd. is the direct negotiation and execution of long-term Time Charter Agreements (TCs) with major energy players. This is where the company secures its earnings visibility. As of the third quarter of 2025, FLEX LNG Ltd. reported a minimum firm contract backlog of 53 years, which could potentially grow to 80 years if charterers exercise all available options. This backlog underpins the company's stability. For instance, the Flex Constellation secured a new 15-year TC running from 2026 to 2041, with an extension option to 2043. This deal, announced in late 2024, is key to the long-term view. The company is focused on securing rates for new charters in line with existing ones, as seen with the Flex Constellation deal.

Here's a look at the contract coverage that defines this channel's success:

The company's fleet consists of thirteen modern LNG carriers, all featuring the latest generation two-stroke propulsion (MEGI and X-DF).

Commercial team marketing vessels for short-term/spot employment when open

When a vessel's contract nears expiry, the commercial team steps in to market the ship for shorter employment, which provides flexibility and captures potential spot market upside. This is a crucial balancing act against the long-term TCs. You need to know which ships are coming open and what the market is paying right now.

The commercial team actively markets vessels that are coming off hire:

• Flex Constellation was open for spot and/or short-term TC for approximately 12 months starting from the end of the first quarter of 2025.
• Flex Volunteer is expected to be available for new employment starting from mid-January 2026.
• Flex Artemis traded in the spot market after redelivery from a five-year time charter in the third quarter of 2025.
• One vessel was on variable hire until a minimum of the third quarter of 2025, with the charterer holding an option to extend this variable hire to 2030.

The realized market rates through this channel show the current earning power. The fleet average Time Charter Equivalent (TCE) rate for the third quarter of 2025 was approximately $70,900 per day, with the guidance for the full year 2025 TCE being between $71,000 and $72,000 per day. To be fair, the Q2 2025 TCE was slightly higher at $72,012 per day.

Investor Relations outreach for capital markets and shareholder communication

FLEX LNG Ltd. uses formal financial reporting and direct engagement to communicate with capital markets, which funds the fleet expansion and refinancing efforts. This channel is about maintaining investor confidence and optimizing the balance sheet.

Key financial and capital market activities reported through this channel in 2025 include:

• Reported third quarter 2025 vessel operating revenues of $85.7 million and a net income of $16.8 million.
• The Board declared a dividend for the third quarter 2025 of $0.75 per share, marking the 17th consecutive quarter of dividend payments.
• Completed a sale and leaseback agreement for Flex Resolute for a consideration of $175 million, involving a 10-year bareboat charter back.
• Signed a $180 million term loan facility for Flex Constellation with a 15.5-year tenor and an interest rate of SOFR plus a margin of 165 basis points.
• The company achieved an all-time high cash balance of $479 million following the completion of vessel refinancings.
• The expected full-year 2025 revenue guidance was narrowed to around $340 million.

The company communicates these updates via scheduled webcasts, such as the Second Quarter 2025 Earnings Presentation on August 20, 2025, and the Third Quarter 2025 Earnings Release on November 12, 2025. Investor and Analyst contact is available through CFO Knut Traaholt at +47 23 11 40 00 or via email at ir@flexlng.com.

FLEX LNG Ltd. (FLNG) - Canvas Business Model: Customer Segments

You're looking at the core of FLEX LNG Ltd.'s business-who is chartering their specialized fleet of floating LNG carriers. The customer base is heavily weighted toward long-term, high-commitment contracts, which is what gives the company its financial stability as of late 2025.

The customer segments for FLEX LNG Ltd. are anchored by counterparties that require long-term, reliable, and often bespoke liquefaction or regasification capacity, which is exactly what their modern fleet provides.

Global energy 'Supermajors' and large integrated oil and gas companies.

This segment represents the highest tier of global energy players who value operational excellence and long-term security. A clear example of this relationship is the contract for the FLNG Gimi, which achieved Commercial Operations Date (COD) in June 2025, commencing its 20-year lease term with BP. These 'Supermajors' often seek to secure capacity for their upstream gas resources without the multi-year, multi-billion dollar capital expenditure of building onshore facilities.

Major national and international LNG importers and utilities.

This group includes state-owned entities and large utility companies focused on securing long-term energy supply for their domestic markets. FLEX LNG Ltd. has secured significant, multi-decade commitments from this segment. For instance, the FLNG Hilli is set for redeployment to Argentina under a 20-year charter with Southern Energy S.A. (SESA), valued at $285 million per year. Furthermore, the under-conversion MKII FLNG also has a 20-year charter signed with SESA, adding another substantial commitment.

Asset-backed LNG traders requiring long-haul transportation.

While the focus appears heavily on long-term fixed contracts, the nature of the LNG market means that traders and other entities needing flexible, long-haul capacity are also key. The company's strategy includes marketing vessels that come off contract, like the Flex Volunteer, which is expected to be available for new employment from mid-January 2026. This indicates a segment that utilizes shorter-term or index-linked contracts to bridge supply gaps or manage immediate shipping needs.

The overall customer commitment provides a high degree of revenue visibility, which management views as a protective measure against market softness.

• Minimum firm contract backlog stands at 53 years as of Q3 2025.
• Maximum potential backlog, including options, is 80 years.
• 80% of available fleet days are covered for the following year (2026).
• The fleet size is thirteen modern LNG carriers on the water as of early 2025.
• The Flex Constellation vessel is fully booked into the year 2041.

Here's a quick look at the financial scale underpinning these customer relationships as of the third quarter of 2025.

The company's strategy is clearly focused on locking in long-duration contracts with creditworthy counterparties, which is why the backlog visibility is so strong. If onboarding takes 14+ days, churn risk rises, but for these long-term charters, the commitment is defintely locked in for decades.

Finance: draft 13-week cash view by Friday.

FLEX LNG Ltd. (FLNG) - Canvas Business Model: Cost Structure

The cost structure for FLEX LNG Ltd. (FLNG) is heavily weighted toward asset ownership and financing obligations, reflecting the capital-intensive nature of operating a modern LNG carrier fleet.

High Capital Expenditure and Financing Costs

Acquiring and maintaining the fleet represents the largest cost driver, though FLEX LNG Ltd. (FLNG) has actively managed its debt profile through its Balance Sheet Optimization Program 3.0.

• The program delivered $530 million in new financings in 2025, extending the next debt maturity to 2029 (Result 4).
• Refinancing activities have successfully reduced the overall cost of debt, with one transaction cutting debt cost by approximately 1.5% annually (Result 1, 6).
• The interest expense for the first 9 months of 2025 was down $10 million compared to the prior year (Result 2).
• Specific debt instruments, like the $180 million term loan for Flex Constellation, carry an interest rate of SOFR plus a margin of 165 basis points (Result 4, 12).
• The fleet consists of thirteen LNG carriers equipped with modern two-stroke propulsion technology (Result 1).

Vessel Operating Expenses (OpEx)

Day-to-day running costs are substantial but relatively stable due to long-term contracts. The prompt's suggested average is well-supported by recent figures.

These OpEx figures include crew changes and auxiliary engine maintenance costs, which caused an increase in Q1 2025 (Result 7).

Dry-Docking and Maintenance

Mandatory special surveys require vessels to be taken out of service, incurring unpredictable and substantial costs. FLEX LNG Ltd. (FLNG) manages this through operational cash flow provisions.

• Cash flow from operations for Q3 2025 was $37 million after drydock expenditures (Result 12).
• Drydockings for Flex Amber and Flex Resolute were completed in June/July 2025 (Result 8, 12).
• The company plans to complete three drydockings in 2026: Flex Volunteer, Flex Freedom, and Flex Vigilant (Result 4).

General and Administrative (G&A) Overhead

Corporate overhead remains controlled, a key factor when managing a fleet of this size.

The six-month administrative expense of $4.5 million is lower than the $5.3 million reported for the same period in 2024 (Result 8, 13). That's a definite cost saving you can see right there.

FLEX LNG Ltd. (FLNG) - Canvas Business Model: Revenue Streams

The primary revenue stream for FLEX LNG Ltd. (FLNG) is built upon securing long-term Time Charter (TC) agreements for its fleet of modern liquefied natural gas (LNG) carriers. This structure provides significant earnings visibility, supported by a minimum firm contract backlog now standing at 59 years, which can extend up to 88 years with charterers' options.

Here's a look at the key financial expectations driving the revenue model for the full year 2025:

You should note that the full-year 2025 revenue guidance is set at approximately $340 million, with the expected average Time Charter Equivalent (TCE) rate anticipated to fall between $71,000 and $72,000 per day for the year. This is a slight shift from the broader guidance range of $340 million to $360 million and a TCE expectation of $72,000-$77,000 per day mentioned elsewhere for 2025.

Revenue exposure outside of the core long-term TC contracts includes activity in the short-term or spot market. For instance, in the first quarter of 2025, the vessel Flex Constellation was employed in the short-term market following a redelivery in February. This exposure is variable; the Q1 2025 revenue decrease compared to Q4 2024 was partly due to lower earnings from Flex Artemis, which was on a variable index hire contract.

The total Q1 2025 vessel operating revenues of $88.4 million included specific non-charter components:

• Income from European Union Allowances (EUAs) under the EU ETS was $1.6 million for Q1 2025.
• Revenue excluding EUA income for Q1 2025 was $86.8 million.
• The Q1 2025 revenue was sequentially lower than Q4 2024's $90.9 million.