Golar LNG Limited preliminary fourth quarter and financial year
2021 results
- Total Q4 operating revenues of $115.0 million and
Adjusted EBITDA1 of $93.5 million.
- FLNG Hilli: Increased earnings from Brent Oil linked
production, realized income increase of 45% on prior quarter to
$12.9 million in Q4. Further 2022 earnings upside from Dutch Title
Transfer Facility (“TTF”) linked
production.
- Formation of Cool Company Limited
(“CoolCo”) will reduce Golar's
Contractual Debt1 by approximately $833 million and will improve
Golar’s cash and marketable securities position by $342
million.
- Entered into a new $250.0 million undrawn corporate
bilateral facility with Sequoia Investment Management to further
increase financial flexibility and facilitate FLNG
growth.
- Simplification process concluded, focus shift to FLNG
growth projects.
- Awarded 2021 winner of North America Best ESG Energy
Business Strategy by Capital Finance International.
The formation and funding of LNG shipping
pure-play CoolCo marks the last major step of Golar LNG Limited’s
(“Golar" or “the Company”) corporate simplification process. Over
the last 12 months that process has involved the sale of assets and
subsidiaries for a total enterprise value of approximately $6.2
billion and the refinancing of around $1 billion of debt. This has
crystalized underlying value and significantly strengthened our
cash and marketable securities position to more than $1.1 billion,
facilitating attractive future growth. Golar will now focus on
further increasing the value generated by FLNG Hilli and delivering
FLNG Gimi to BP. We will seek further FLNG growth projects,
leveraging on our market leading track record of FLNG development,
construction and operations. We continue to make significant
progress on new FLNG projects with existing and new prospective
clients and expect a contract award within 2022.
The FLNG Hilli achieved another quarter of 100%
commercial uptime. As announced in July 2021, production has seen a
0.2MTPA increase, effective Q1 2022, where the tariff for the
incremental production is linked to TTF gas prices. Based on
expected TTF linked earnings for Q1 of $22.1 million, $19.0 million
for each of Q2 and Q3, and a current Q4 TTF forward price of
$29/MMBtu, Golar's share of Hilli's 2022 TTF linked income is
expected to be approximately $80 million. This can be expected to
increase (or decrease) by $0.9 million for each $1.00/MMBtu change
in the TTF forward price. Current customer of FLNG Hilli, Perenco
is progressing with its drilling campaign with the purpose to take
advantage of its one-time three year option expiring in July 2022
to increase production by up to 0.4mtpa from 2023-2026 on the same
TTF linked tolling agreement.
FLNG Gimi is 80% technically complete.
Pre-commissioning and testing of multiple systems is now underway
with construction on track to meet the scheduled 2023 start-up date
for the 20-year lease and operate agreement with BP. This will
unlock around $3.0 billion of earnings backlog1 to Golar. Assuming
current Brent oil and TTF prices prevail and Perenco is able to
support production of 1.6mtpa from 2023, Golar's share of annual
Adjusted EBITDA1 generation from Hilli and Gimi could exceed $400
million within 3 years, a quadrupling of 2021 FLNG related
earnings.
The formation of CoolCo enables an attractive
business separation of Golar’s 8 TFDE1 vessels, creating a leading
market player for LNG shipping. By separating shipping activities
from the FLNG segment, we allow for pure play exposures that may
facilitate faster and more attractive growth for both business
segments. Golar shares the enthusiasm of 38% CoolCo owner EPS
Ventures Ltd. for further consolidation in the sector and sees some
interesting near-term opportunities. As a result of the CoolCo
transaction Golar will de-consolidate approximately $832.9 million
of year-end Contractual Debt1 associated with the 8 TFDE1 vessels
upon closing, expected during Q1 2022. Golar also expects to
receive a cash settlement of approximately $217 million, whilst
retaining meaningful exposure to an expected continued
strengthening of LNG shipping fundamentals. Golar will equity
account for its approximate 31% interest in CoolCo upon closing of
the sale and purchase agreements.
The Company will continue to explore conversion,
sale, or charter alternatives for its remaining steam turbine
vessel Golar Arctic, and TFDE1 FSRU Golar Tundra. Golar Tundra is
one of the highest-spec large FSRUs available in the market for
potential charterers looking to secure a rapid backup source of
gas. Recent political developments have enhanced the attractiveness
of this position.
Financial Summary
(in thousands of $) |
Q4 2021 |
Q4 2020 |
% Change |
YTD 2021 |
YTD 2020 |
% Change |
Net
income/(loss) attributable to Golar LNG Ltd |
6,843 |
8,126 |
(16)% |
412,685 |
(273,557) |
(251)% |
Total
operating revenues |
115,048 |
118,684 |
(3)% |
451,765 |
438,637 |
3% |
Adjusted
EBITDA |
93,523 |
78,031 |
20% |
312,650 |
278,676 |
12% |
Golar's share of contractual debt 1 |
2,239,496 |
2,151,089 |
4% |
2,239,496 |
2,151,089 |
4% |
Q4 highlights and recent
events
Financial and corporate:
- Profitability: Net income attributable to
Golar of $6.8 million, and Adjusted EBITDA1 of $93.5 million for
the quarter, including:
- A $51.6 million non-cash mark-to-market loss recognized on New
Fortress Energy Inc. (“NFE”) shares based on a December 31, 2021
carrying value of $24.14 per share.
- A $32.9 million non-cash gain recognized on Hilli Brent oil and
TTF natural gas linked derivative instruments.
- A $12.9 million realized gain on the Hilli Brent oil
derivative. This is expected to further increase to around $16.5
million in Q1 2022.
- Hedges: Entered into swap arrangements to
hedge 100% of Golar's exposure to Q2 and Q3 incremental Hilli TTF
linked 2022 production at an average TTF price of
$25.375/MMBtu.
Financing facilities:
- Unsecured Bond: Successfully placed USD $300.0
million Norwegian Bonds in October 2021.
- Convertible Bond: $315.6 million net
outstanding balance of 2.75% $402.5 million Convertible Bonds as of
December 31, 2021 redeemed on February 15, 2022.
- Credit Facility: $100.0 million December 2021
maturing Revolving Credit Facility ("RCF") repaid in November 2021.
$131.0 million of new $200.0 million 3-year corporate RCF drawn on
February 4, 2022.
- New Corporate Facility: Executed a new $250
million 7-year bilateral corporate facility with Sequoia Investment
Management on February 11, 2022, secured by Golar's shareholding in
FLNG Hilli and Gimi.
- Golar Tundra Loan: $158.0 million 5-year Golar
Tundra facility that can be increased to $182.0 million executed in
December 2021.
- CoolCo financing: agreed a new sustainability
linked $570 million bank facility to finance the acquisition of 6
of the 8 carriers that CoolCo is acquiring from Golar. $240 million
of existing lease financing on two vessels will be transferred to
CoolCo.
FLNG:
- Utilization: Industry leading operations
maintained with 100% commercial uptime by FLNG Hilli.
- FLNG Hilli now producing additional 0.2mtpa of agreed TTF
linked 2022 production. Customer drilling campaign in progress to
prove up additional reserves.
- Construction: FLNG Gimi conversion project 80%
technically complete. Over 16-million man-hours worked with very
strong safety record.
- Commercial: Continued progress on new FLNG
projects with existing and new prospective clients. The
Company expects a further contract award before year end 2022.
- Hilli earnings insulated from inflation by virtue of Brent oil
and TTF commodity links. Gimi earnings protected by operating cost
pass through provisions in contract.
Shipping:
- Shipping Rates: Q4 2021 TCE1 of $57,300 for
the fleet, up 16% on Q3 2021 and 17% on Q4 2020.
- Utilization: Fleet utilization at 99%, in line
with Q3 2021 and up on the 77% realized in Q4 2020.
- Time Charter: Fixed a carrier on a 12-month
charter at around $100,000 per day in October 2021.
- Outlook: Attractive longer term rates hold up
on the back of limited available tonnage despite near-term weakness
in spot rates due to seasonality and fluctuations in regional LNG
prices.
Financial ReviewBusiness
Performance:
|
2021 |
2020 |
|
Oct-Dec |
Jul-Sep |
Oct-Dec |
(in thousands of $) |
Total |
Total |
Total |
Net profit/(loss) |
44,645 |
(55,635) |
38,642 |
Income taxes |
1,175 |
152 |
383 |
Profit/(loss) before income taxes |
45,820 |
(55,483) |
39,025 |
Depreciation and amortization |
26,464 |
26,489 |
26,826 |
Unrealized (gain)/loss on oil and gas derivative instruments |
(32,944) |
(64,092) |
5,700 |
Other non-operating losses/(income), net |
50,012 |
153,791 |
(5,682) |
Interest income |
(72) |
(6) |
(140) |
Interest expense |
13,553 |
13,763 |
15,217 |
Gains on derivative instruments |
(8,950) |
(581) |
(2,120) |
Other financial items, net |
1,283 |
(227) |
3,538 |
Equity in net (earnings)/losses of affiliates |
(1,641) |
718 |
148 |
Net (income)/loss from discontinued operations |
(2) |
117 |
(4,481) |
Adjusted EBITDA (1) |
93,523 |
74,489 |
78,031 |
|
2021 |
|
Oct-Dec |
Jul-Sep |
(in thousands) |
Shipping |
FLNG |
Corporate and other |
Total |
Shipping |
FLNG |
Corporate and other |
Total |
Total operating revenues |
52,440 |
56,406 |
6,202 |
115,048 |
45,829 |
54,480 |
6,294 |
106,603 |
Vessel operating expenses |
(9,892) |
(11,907) |
(4,461) |
(26,260) |
(16,216) |
(13,243) |
(2,477) |
(31,936) |
Voyage, charterhire & commission income/(expenses) |
260 |
(150) |
232 |
342 |
(1,211) |
(150) |
(25) |
(1,386) |
Administrative expenses/(income) |
(187) |
(212) |
(7,551) |
(7,950) |
(204) |
143 |
(8,542) |
(8,603) |
Project development expenses/(income) |
— |
(858) |
266 |
(592) |
— |
(1,371) |
70 |
(1,301) |
Realized gain on oil derivative instrument(2) |
— |
12,935 |
— |
12,935 |
— |
8,862 |
— |
8,862 |
Other operating income |
— |
— |
— |
— |
2,250 |
— |
— |
2,250 |
Adjusted EBITDA(1) |
42,621 |
56,214 |
(5,312) |
93,523 |
30,448 |
48,721 |
(4,680) |
74,489 |
(2) The line item “Realized and unrealized
gain/(loss) on oil and gas derivative instruments” in the Condensed
Consolidated Statements of Operations relating to income from the
Hilli Liquefaction Tolling Agreement (“LTA”) and natural gas
derivative is split into: “Realized gains on oil derivative
instrument” and “Unrealized gain/(loss) on oil and gas derivative
instrument”. The unrealized component represents a mark-to-market
gain of $32.9 million (September 30, 2021: $64.1 million gain and
December 31, 2020: $5.7 million loss) on the embedded oil and gas
derivative, which represents the estimate of expected receipts
under the remainder of the Brent oil linked clause and 2022
contracted capacity increase clause of the Hilli LTA. The realized
component amounts to $12.9 million (September 30, 2021: $8.9
million and December 31, 2020: $nil) and represents the income in
relation to the Hilli LTA receivable in cash.
|
2020 |
|
Oct-Dec |
(in thousands of $) |
Shipping |
FLNG |
Corporate and other |
Total |
Total operating revenues |
50,727 |
62,489 |
5,468 |
118,684 |
Vessel operating expenses |
(14,629) |
(11,677) |
89 |
(26,217) |
Voyage, charterhire & commission expenses |
(5,792) |
— |
— |
(5,792) |
Administrative expenses |
(795) |
(871) |
(6,921) |
(8,587) |
Project development expenses |
(8) |
(1,363) |
(1,416) |
(2,787) |
Other operating income |
2,730 |
— |
— |
2,730 |
Adjusted EBITDA (1) |
32,233 |
48,578 |
(2,780) |
78,031 |
We report today Q4 net income of $6.8 million
attributable to Golar, and Adjusted EBITDA1 of $93.5 million,
compared to a Q3 net loss attributable to Golar of $91.0 million,
and Adjusted EBITDA1 of $74.5 million.
Total operating revenues increased from $106.6
million in Q3 to $115.0 million in Q4 and were further supported by
a decrease in voyage, charter hire and commission expenses, down
from $1.4 million in Q3 to $0.3 million credit in Q4. The increase
in total operating revenues and decrease in voyage expenses was
mainly attributable to a seasonally improved shipping
performance.
Revenue from shipping, net of voyage, charter
hire and commission expenses was $52.7 million and increased by
$8.1 million from $44.6 million in Q3. The quarter began with
quoted TFDE1 carrier headline spot rates at around $71,000 per day
and ended with rates at around the same level, despite a
significant spike in rates during the intervening period. Full
fleet TCE1 earnings increased from $49,500 in Q3 to $57,300 in Q4
2021.
Total operating revenues from FLNG Hilli
including base tolling fees and amortization of pre-acceptance
deferred gains recognized increased $1.9 million to $56.4 million
in Q4, against $54.5 million in Q3. Revenues from overproduction
account for the $1.9 million Q4 increase. Total overproduction
revenues for 2021 amount to $3.2 million and Golar received payment
for this in Q1 2022.
An insurance receipt in Q4 accounts for most of
the $5.6 million decrease in vessel operating expenses, down from
$31.9 million in Q3 to $26.3 million in Q4. As a result of an
overhead streamlining exercise earlier in the year and reduced
employee stock compensation costs, Administrative expenses
decreased from $8.6 million in Q3 to $8.0 million in Q4. Project
development expenses at $0.6 million for Q4 declined by $0.7
million, with most of the reduction attributable to a decrease in
FLNG front end engineering and design costs.
The Brent oil linked component of Hilli's fees
generates additional annual operating cash flows of approximately
$3.1 million for every dollar increase in Brent Crude prices
between $60.00 per barrel and the contractual ceiling. Billing of
this component is based on a three-month look-back at average Brent
Crude prices. As a result of rising prices, a $12.9 million
realized gain on the oil derivative instrument (Golar 89.1% share
equivalent to $11.5 million) was recorded in Q4, up from the $8.9
million realized in Q3.
A loss of hire claim in respect of a now
repaired motor that failed on board one of the carriers accounts
for the shipping related Other operating income of $2.3 million in
Q3.
Depreciation and amortization, at $26.5 million
was in line with the prior quarter.
The mark-to-market fair value of the Hilli Brent
oil linked derivative asset increased by $18.4 million during the
quarter, with a corresponding unrealized gain of the same amount
recognized in the income statement. The fair value increase was
driven by an upward movement in the expected future market price
for Brent oil.
After entering into agreement with the customer
in July 2021 to increase Hilli production by 0.2 million tons in
2022, a derivative asset, representing the fair value of the
estimated discounted cash flows of payments due as a result of the
TTF natural gas price linked additional 2022 production, was
recognized on July 22, 2021. Like the Brent oil derivative above,
the TTF derivative asset is adjusted to fair value at each balance
sheet date and, on December 31, 2021, the value of this asset
increased to $79.6 million. This resulted in the recognition of an
unrealized TTF natural gas fair value gain in the income statement
of $14.5 million in Q4. Together with the $18.4 million unrealized
mark-to-market gain on the Brent oil derivative, a $32.9 million
unrealized gain on oil and gas derivative instruments was reported
in Q4.
A decline in the NFE share price between October
1 and December 31 resulted in the recognition of a Q4 unrealized
mark-to-market loss of $51.6 million on Golar’s 18.6 million NFE
shares. The fair value of these shares was $24.14 per share as of
December 31, 2021. Netted against this was $1.9 million of dividend
income from NFE following its dividend declaration on November 2,
2021. Together these accounted for most of the $50.0 million of
other non-operating losses during the quarter.
Interest expense at $13.6 million was in line
with the prior quarter. A further increase in interest swap rates
contributed to a $9.0 million gain on derivative instruments in Q4,
compared to a $0.6 million gain in Q3.
Equity in net earnings of affiliates of $1.6
million is comprised of Golar's 23% investment in small-scale
services provider Avenir LNG Limited ("Avenir") and 50% stake in
Egyptian Company for Gas Services. As it will have Board
representation, Golar will also equity account for its 31% interest
in affiliate, CoolCo. There will be no quarterly mark-to-market
changes in the value of this investment. Indicative proforma
results of the shipping segment, as at December 31, 2021 without
the 8 TFDE1 LNG carriers is outlined in Appendix B.
Net income attributable to non-controlling
interests relate to the Hilli, the Gimi and the finance lease
lessor VIEs.
Balance Sheet and Liquidity:
Our cash position as at December 31, 2021 was
$418.8 million. This was made up of $268.6 million of unrestricted
cash1 and $150.2 million of restricted cash. Restricted cash
includes $59.2 million relating to lessor-owned VIEs and $60.7
million relating to the Hilli Letter of Credit. Golar's total share
of this cash position therefore amounts to $359.6 million. As of
December 31, 2021, Golar also had an undrawn RCF of up to $200
million secured by its 18.6 million NFE shares. On February 4,
2022, $131.0 million was drawn against this facility and on
February 15, the outstanding balance of our $402.5 million 2.75%
convertible bond, of $317.3 million (including interest) was fully
redeemed. The Company expects to repay the RCF upon receipt of the
net sales proceeds from the CoolCo transaction.
On February 11, 2022, Golar entered into a new
$250.0 million bilateral facility with Sequoia Investment
Management secured by the Company's equity stakes in FLNG Hilli and
Gimi. Available for drawdown until 30 June 2022 and carrying
interest of LIBOR + 450-550bps subject to certain financial ratios,
this facility has a tenor of 7-years with a bullet maturing in
February 2029. Together with remaining cash on hand and
approximately $217.0 million receivable in respect of the CoolCo
transaction, this facility can be used for FLNG investments.
Available funds for investment can be increased further using cash
generated from operations and marketable securities.
Funding for FLNG |
USD Million |
December 31, 2021, Total Golar cash |
360 |
Feb 04, 2022: Drawdown against $200m
3-year corporate RCF |
131 |
Feb 15, 2022: Redeem balance of 2.75%
$402.5 million Convertible Bond (incl. interest) |
(317) |
Q1 2022 Proceeds expected from CoolCo
spin |
217 |
Undrawn balance of $200m corporate RCF (up
to) |
69 |
Undrawn balance of $250m Corporate
bilateral facility (up to) |
250 |
Potential near-term funds available for FLNG investment without
recourse to investments |
710 |
Marketable securities: |
|
NFE, Avenir, and CoolCo shares(3) |
623 |
Net of corporate RCF secured by NFE
investment |
(200) |
Upsized potential funding available for FLNG investment |
1,133 |
(3) Based on values as of December 31, 2021 for
NFE and Avenir and Golar 31% share of CoolCo at formation.
Inclusive of $10.5 million of capitalized
interest, $27.3 million was invested in FLNG Gimi during the
quarter, taking the total Gimi Asset under development balance as
at December 31, 2021, to $877.8 million. Of this, $410.0 million
had been drawn against the $700 million debt facility. Both the
investment and debt drawn to date are reported on a 100% basis.
Golar's share of remaining capital expenditure, net of the
Company's share of the remaining $290.0 million undrawn debt
amounts to $210.0 million. Fees receivable during the final
commissioning phase can fund a portion of this. Subsequent to the
quarter end, a further $75.0 million has been drawn against the
$700 million facility.
Included within the $1.1 billion current portion
of long-term debt and short-term debt as at December 31, 2021, is
$315.6 million in respect of the Convertible Bond, and $707.5
million relating to lessor-owned VIE subsidiaries that Golar is
required to consolidate in connection with seven sale and leaseback
financed vessels, including the Hilli. Upon closing of the CoolCo
transaction, Golar will be left with one sale and leaseback
financed asset (Hilli) and therefore one lessor-owned VIE
subsidiary to consolidate.
Of the $2.9 billion of Vessels and equipment,
net on the balance sheet, $1.38 billion relates to the 8 TFDE1
carriers being transferred to CoolCo. Based on the agreed average
TFDE1 ship valuation of $145 million, the transfer value of these
carriers amounts to $1.16 billion. Golar therefore expects to
record a loss on sale of between $210-$230 million in Q1 2022.
Golar's $125 million investment in CoolCo will be added to
Investments in Affiliates on the balance sheet.
Of Golar's $2.2 billion share of Contractual
debt as of December 31, 2021, $0.8 billion relates to the 8 TFDE1
vessels and will be removed from the balance sheet, leaving $1.4
billion. Net of Total Golar cash of $0.4 billion, Net Debt1 falls
to around $1.0 billion. If marketable securities were to be taken
into account, this figure reduces by a further $0.6 billion.
Assuming current commodity prices prevail, 2022 Adjusted EBITDA1
could exceed $200 million. This should increase further in 2023 if
Perenco exercise their option to increase Hilli production to
1.6mtpa, and should exceed $400 million after the first full year
of Gimi operations, expected in 2024. Offering strong debt
coverage, near-term earnings power and meaningful growth potential
that can be financed, the simplified Golar is expected to be well
positioned for new FLNG projects.
Corporate and Other Matters:
As at December 31, 2021, there were 108.2
million shares outstanding. There were also 1.5 million outstanding
stock options with an average price of $17.65 and 0.4 million
unvested restricted stock units awarded. Of the initial $50.0
million approved share buyback scheme, $25.5 million remains
available for further repurchases which will be opportunistically
pursued.
Non-GAAP measures
In addition to disclosing financial results in
accordance with U.S. generally accepted accounting principles (US
GAAP), this earnings release and the associated investor
presentation contains references to the non-GAAP financial measures
which are included in the table below. We believe these non-GAAP
financial measures provide investors with useful supplemental
information about the financial performance of our business, enable
comparison of financial results between periods where certain items
may vary independent of business performance, and allow for greater
transparency with respect to key metrics used by management in
operating our business and measuring our performance.
These non-GAAP financial measures should not be
considered a substitute for, or superior to, financial measures
calculated in accordance with GAAP, and the financial results
calculated in accordance with GAAP. Non-GAAP measures are not
uniformly defined by all companies, and may not be comparable with
similarly titled measures and disclosures used by other companies.
The reconciliations from these results should be carefully
evaluated.
Non-GAAP measure |
Closest equivalent US GAAP measure |
Adjustments to reconcile to primary financial statements
prepared under US GAAP |
Rationale for adjustments |
Performance measures |
Adjusted EBITDA |
Net (loss)/income attributable to Golar LNG Limited |
+/- Net financial expense+ Other non-operating income/expenses+/-
Income taxes+/- Equity in net (losses)/ earnings of affiliates+/-
Net income attributable to non-controlling interests+/- Unrealized
loss/(gain) on oil derivative instrument+ Depreciation and
amortization+ Impairment of long-term assets+ +/- Net income/(loss)
from discontinued operations |
Increases the comparability of total business performance from
period to period and against the performance of other companies by
excluding the results of our equity investments, removing the
impact of unrealized movements on embedded derivatives and removing
the impact of depreciation, financing and tax items. |
Last Twelve Months (“LTM”) Adjusted EBITDA |
Net (loss)/income attributable to Golar LNG Limited |
The sum of the last four quarters Adjusted EBITDA (defined
above) |
Same as Adjusted EBITDA. The 12-month trailing metric removes
the impact of seasonality on our results. |
Average daily TCE |
Total Operating revenues |
-Liquefaction services revenue-Vessel and other management
fees -Voyage and commission expenses The above total is
then divided by calendar days less scheduled off-hire days. |
Measure of the average daily net revenue performance of a
vessel. Standard shipping industry performance measure
used primarily to compare period-to-period changes in the vessel’s
net revenue performance despite changes in the mix of charter types
(i.e. spot charters, time charters and bareboat charters) under
which the vessel may be employed between the periods.
Assists management in making decisions regarding the
deployment and utilization of its fleet and in evaluating financial
performance. |
Liquidity measures |
Contractual debt |
Total debt (current and non-current), net of deferred finance
charges |
+ VIE Consolidation Adjustment + Deferred Finance Charges |
We consolidate a number of lessor VIEs for our sale and leaseback
facilities. This means that on consolidation, our contractual debt
is eliminated and replaced with the lessor VIEs’ debt.
Contractual debt represents our debt obligations under our
various financing arrangements before consolidating the lessor
VIEs. The measure enables investors and users of our
financial statements to assess our liquidity and the split of our
debt (current and non-current) based on our underlying contractual
obligations. Furthermore, it aids comparability with
competitors. |
Total Golar Cash |
Golar cash based on GAAP measures: + Cash and cash
equivalents + Restricted cash and short-term deposits (current
and non-current) |
-VIE restricted cash and short-term deposits (current and
non-current) |
We consolidate a number of lessor VIEs for our sale and leaseback
facilities. This means that on consolidation, we include restricted
cash held by the lessor VIEs. Total Golar Cash represents our
cash and cash equivalents and restricted cash and short-term
deposits (current and non-current) before consolidating the lessor
VIEs. Management believe that this measure enables
investors and users of our financial statements to assess our
liquidity and aids comparability with our competitors. |
Reconciliations - Performance Measures (Average Daily
TCE Rate)
|
2021 |
2021 |
2020 |
(in thousands of $) |
Oct-Dec |
Jul-Sep |
Oct-Dec |
Total operating revenues |
115,048 |
106,603 |
118,684 |
Less: Liquefaction services revenue |
(56,406) |
(54,480) |
(62,489) |
Less: Vessel and other management fees |
(6,202) |
(6,294) |
(5,468) |
Time and voyage charter revenues |
52,440 |
45,829 |
50,727 |
Less: Voyage and commission expenses |
260 |
(1,210) |
(5,792) |
|
52,700 |
44,619 |
44,935 |
Calendar days less scheduled off-hire days |
920 |
901 |
920 |
Average daily TCE rate (to the closest $100) |
57,300 |
49,500 |
48,800 |
Reconciliations - Liquidity Measures
(Contractual Debt)
(in thousands of $) |
December 31, 2021 |
September 30, 2021 |
December 31, 2020 |
Total debt (current and non-current) net of deferred finance
charges |
2,409,800 |
2,281,721 |
2,350,782 |
VIE consolidation adjustments |
315,652 |
321,427 |
293,236 |
Deferred finance charges |
32,125 |
24,816 |
28,749 |
Total Contractual Debt |
2,757,577 |
2,627,964 |
2,672,767 |
Less: Golar Partners', Keppel's and B&V's share of the Hilli
contractual debt |
(395,081) |
(404,231) |
(431,678) |
Less: Keppel's share of the Gimi debt |
(123,000) |
(123,000) |
(90,000) |
Golar's share of Contractual Debt |
2,239,496 |
2,100,733 |
2,151,089 |
Please see Appendix A for the capital repayment
profile of Golar’s contractual debt.
Reconciliations - Liquidity Measures
(Total Golar Cash)
(in thousands of $) |
December 31, 2021 |
September 30, 2021 |
December 31, 2020 |
Cash and cash equivalents |
268,627 |
123,690 |
127,691 |
Restricted cash and short-term deposits (current and
non-current) |
150,165 |
144,480 |
163,181 |
Less: VIE restricted cash |
(59,230) |
(65,105) |
(36,875) |
Total Golar Cash |
359,562 |
203,065 |
253,997 |
Non-US GAAP Measures Used in
Forecasting Revenue Backlog: Revenue
backlog is defined as the minimum contracted daily charter rate for
each vessel multiplied by the number of scheduled hire days for the
remaining contract term. Revenue backlog is not intended to
represent Adjusted EBITDA or future cashflows that will be
generated from these contracts. This measure should be seen as a
supplement and not a substitute for our US GAAP measures of
performance.
Earnings Backlog: Earnings
backlog represents the share of contracted fee income for executed
contracts less forecasted operating expenses for these contracts.
In calculating forecasted operating expenditure, management has
assumed that where there is an Operating Services Agreement the
amount receivable under the services agreement will cover the
associated operating costs, therefore revenue from operating
services agreements is excluded.
Definitions
TFDE: Tri-fuel Diesel Electric engine
FSRU: Floating Storage Regasification
UnitUnrestricted cash: Unrestricted cash refers to
our cash and cash equivalents
Forward Looking StatementsThis
press release contains forward-looking statements (as defined in
Section 21E of the Securities Exchange Act of 1934, as amended)
which reflects management’s current expectations, estimates and
projections about its operations. All statements, other than
statements of historical facts, that address activities and events
that will, should, could or may occur in the future are
forward-looking statements. Words such as “believe,” “anticipate,”
“intend,” “estimate,” “forecast,” “project,” “plan,” “potential,”
“will,” “may,” “should,” “expect,” “may,” “could,” “would,”
“predict,” “propose,” “continue,” or the negative of these terms
and similar expressions are intended to identify such
forward-looking statements. These statements are not guarantees of
future performance and are subject to certain risks, uncertainties
and other factors, some of which are beyond our control and are
difficult to predict. Therefore, actual outcomes and results may
differ materially from what is expressed or forecasted in such
forward-looking statements. You should not place undue reliance on
these forward-looking statements, which speak only as of the date
of this press release. Unless legally required, Golar undertakes no
obligation to update publicly any forward-looking statements
whether as a result of new information, future events or otherwise.
Among the important factors that could cause actual results to
differ materially from those in the forward-looking statements
are:
- the possibility that the Cool Co spin-off will not close when
expected or at all because conditions to the closing are not
satisfied on a timely basis or at all, that Golar may be required
to modify the terms and conditions of the spin-off or that the
anticipated benefits of the spin-off are not realized as a result
of among other things the weakness of the economy and competitive
factors in the shipping sector;
- our inability and that of our counterparty to meet our
respective obligations under the Lease and Operate Agreement
entered into in connection with the BP Greater Tortue / Ahmeyim
Project (“Gimi GTA Project”);
- a decline or continuing volatility in the global financial
markets, specifically with respect to our equity holding in
NFE;
- failure of shipyards to comply with delivery schedules or
performance specifications on a timely basis or at all;
- our vessel values and any future impairment charges we may
incur;
- continuing uncertainty resulting from potential future claims
from our counterparties of purported force majeure under
contractual arrangements, including but not limited to our
construction projects (including the Gimi GTA Project) and other
contracts to which we are a party;
- our ability to formalize a settlement agreement with
authorities regarding tax benefits previously obtained under
certain of our leasing agreements;
- claims made or losses incurred in connection with our
continuing obligations with regard to Hygo Energy Transition Ltd
(“Hygo”) and Golar LNG Partners LP (“Golar Partners”);
- the ability of Hygo, Golar Partners and NFE to meet their
respective obligations to us, including indemnification
obligations;
- changes to rules and regulations applicable to LNG carriers,
FSRUs, FLNGs or other parts of the LNG supply chain;
- changes in our ability to retrofit vessels as floating storage
and regasification units (“FSRUs”) or floating liquefaction natural
gas vessels (“FLNGs”) and in our ability to obtain financing for
such conversions on acceptable terms or at all;
- changes in our ability to obtain additional financing on
acceptable terms or at all;
- the length and severity of outbreaks of pandemics, including
the worldwide outbreak of the novel coronavirus (“COVID-19”) and
its impact on demand for liquefied natural gas (“LNG”) and natural
gas, the timing of completion of our conversion projects, the
operations of our charterers, our global operations and our
business in general;
- failure of our contract counterparties to comply with their
agreements with us or other key project stakeholders;
- changes in LNG carrier, FSRU, or FLNG charter rates, vessel
values or technological advancements;
- our ability to close potential future sales of additional
equity interests in our vessels, including the Hilli and Gimi or to
monetize our interest in NFE on a timely basis or at all;
- our ability to contract the full utilization of the Hilli or
other vessels;
- changes in the supply of or demand for LNG carriers, FSRUs or
FLNGs;
- a material decline or prolonged weakness in rates for LNG
carriers, FSRUs or FLNGs;
- changes in the performance of the pool in which certain of our
vessels operate;
- changes in trading patterns that affect the opportunities for
the profitable operation of LNG carriers, FSRUs or FLNGs;
- changes in the supply of or demand for LNG or LNG carried by
sea;
- continuing volatility of commodity prices;
- changes in the supply of or demand for natural gas generally or
in particular regions;
- changes in our relationships with our counterparties, including
our major chartering parties;
- changes in our relationship with our affiliates and the
sustainability of any distributions they pay us;
- changes in general domestic and international political
conditions, particularly where we operate;
- changes in the availability of vessels to purchase and in the
time it takes to construct new vessels;
- our inability to achieve successful utilization of our fleet or
inability to expand beyond the carriage of LNG and provision of
FSRU and FLNGs, particularly through our innovative FLNG
strategy;
- actions taken by regulatory authorities that may prohibit the
access of LNG carriers, FSRUs and FLNGs to various ports;
- increases in costs, including, among other things, wages,
insurance, provisions, repairs and maintenance; and
- other factors listed from time to time in registration
statements, reports, or other materials that we have filed with or
furnished to the Securities and Exchange Commission, or the
Commission, including our most recent annual report on Form
20-F.
As a result, you are cautioned not to rely on
any forward-looking statements. Actual results may differ
materially from those expressed or implied by such forward-looking
statements. The Company undertakes no obligation to publicly update
or revise any forward-looking statements, whether as a result of
new information, future events or otherwise unless required by
law.
February 24, 2022The Board of DirectorsGolar LNG
LimitedHamilton, BermudaInvestor Questions: +44 207 063
7900Karl Fredrik Staubo - CEOEduardo Maranhão - CFO
Stuart Buchanan - Head of Investor Relations
This information is subject to the disclosure requirements
pursuant to Section 5-12 the Norwegian Securities Trading Act
- Golar LNG Limited preliminary fourth quarter and financial year
2021 results
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