Golar LNG Limited

Welcome to the GOLA LNG Limited Q4 2022 results presentation. After the slide presentation by CEO Karl Fredrik Staubo and CFO Eduardo Maranhao, there will be a question and answer session. Information on how to ask a question will be provided then. At this time, all participants are in listen-only mode. I will now pass you over to Karl Fredrik Staubo. Karl, please go ahead.

Thank you, operator, and welcome to Goal RLNG's Q4 earnings results presentation. My name is Karl Fredrik Staubo, CEO of Goal RLNG. I'm accompanied today by our CFO, Mr. Eduardo Maranhao, to present this quarter's results. Before we get into the presentation, please note the forward-looking statements on slide two. Turning to slide three, This morning, we sold our remaining shareholding in Cool Company Limited for a net proceeds of about $56 million. Since our last earnings call, we've also exited our shareholding in New Fortress Energy and bought back their stake in our FL&D, Hilly. Our only current shareholding is Avenir LNG with a book value of around $42 million. Our core business is owning our two FL&Ds, Hilling, operating for Perenco in Cameroon. Hilly generates significant operating cash flows due to its commodity-linked tariff. The unit is coming up for re-contracting in July 2026, and we're very optimistic to increase utilization and improve commercial terms for the unit upon re-contracting. Jimmy is expected to start its 20-year contract for BP on the Tor 2 field outside Mauritania and Senegal later this year. She will then start to engage cash flow on the more than $1.2 billion invested in the project to date. We are also actively pursuing ordering of a Mark 2 FLNG with an annual liquefaction capacity of 3.5 million tons per annum, and we'll get back to that later in the presentation. Turning to slide four and the Q4 highlights. GOLA reports a 2022 net income of 788 million and a record book value of 2.9 billion, equivalent to about $27 a share. Our cash position stands at approximately $1 billion, or $9.3 a share. In total, we have monetized 572 million in cash during Q4-22 and Q1 year-to-date by exiting New Fortress Energy and Coal Company. We also used our remaining 4.1 million shares in NFE as part settlement to acquire NFE stake in Hille. During Q4, we repurchased 141 million or We also utilized our remaining buyback basket to repurchase and cancel 0.2 million shares. And we currently have around 107.2 million shares outstanding. The board and management are now exploring alternatives to commence a dividend and or a new share buyback program. We had an active quarter for HILI. The unit generated $86 million in EBITDA. We unbound our 2023 and 2024 TTF hedges, securing approximately $140 million in TTF-linked earnings and increased our exposure to TTF prices. We also agreed to acquire NFE stake in Hille, effective from January 1st this year, and we expect that transaction to close during the first quarter of this year. GIMMI is now 92% complete and on schedule for sale away during first half. As mentioned, we significantly progressed our FLNG growth ambitions by securing a donor vessel for a Mark II FLNG conversion, as well as progressed yard and financing discussions for that unit. We continue to favor the economics of integrated FLNG projects and are actively working with upstream partners to develop attractive integrated projects. I'll now hand the call over to Eduardo to present our Q4 results.

Thanks, Karl. Good morning, everyone. I'm very pleased to provide an update on our group results for the fourth quarter of 2022. Turning over to slide number six, I wanted to show some of the financial highlights of this quarter. 2022 was a record year for Golr. Our net income on Q4 was $71 million, leading to a record net income of $788 million for the full 2022 calendar year. This was our highest net income to date, and represented an increase of 90% when compared to 2021. We now have a record total book equity of $2.9 billion with a debt-free balance sheet and strong cash reserves of more than $1 billion to support further FLNG growth. This quarter, we recorded an adjusted EBITDA of $87 million, an increase of 2% when compared to the previous quarter. On a year-on-year basis, our total adjusted EBITDA in 2022 has grown to $363 million, an increase of 16% compared to 2021. It's important to highlight that even after the disposal of our shipping business, we have continued to grow our cash generation due to strong performance from our FLNG business, where we almost doubled our EBITDA to $367 million compared to 191 million in 2021. I'll provide some further details regarding this in the next slide. Total FLNG tariffs on Q4 were $129 million, up 18% compared to the previous quarter. FLNG tariff is comprised of total revenues from liquefaction services and realized gains on oil and gas derivative instruments. Due to a combination of upstream technical issues in Q4 and HILI maintenance, 2022 LNG production was 3.5% below the annual contracted volume, and a non-cash accrual of $36 million liability was recognized. Because of that, our stated operating revenues from FLNG were lower in Q4 when compared to the previous quarter. The issues that resulted in the reduced production were resolved last year, and healing has been produced into schedule since then. We expect that this production shortfall will be compensated through overproduction in 2023, where we expect to recognize an additional EBITDA of $36 million, offsetting the 2022 underutilization liability with no expected net cash impact to GOLA. As pointed out by Karl, we have bought back $141 million of unsecured bonds at par, which brought our share of contractual debt at the end of the quarter to $844 million. Our total cash position at the end of the year stood at just shy of a billion dollars at $991 million. So moving on to slide seven, we continue to strengthen our balance sheet. to allow the company to pursue new FLNG growth projects. Our cash position currently stands at more than $1 billion, even when considering the acquisition of NFE's interest in Healy, which will require $100 million cash payment as part of the total consideration and is expected to close in Q1. The acquisition of Healy is expected to increase our run rate adjusted EBITDA by $70 million annually, and we will also add a further $323 million in debt. Despite this incremental debt, we expect to remain debt-free due to cash receivables of $140 million, which were locked in with the unwinding of the TTF hedges earlier this year. As you can see on the right-hand side of the slide, we have significantly delivered our balance sheets from approximately $2 billion of net debt just two years ago at the end of 2020 to a debt-free position we have today. Moreover, we almost doubled our EBITDA to $363 million, which we saw in 2022. We expect this to continue to increase post acquisition of the remaining interest in Healy, and once FLNG GIME commences operation. Moving on to slide eight, I would like to provide some further insight into our earnings from Healy. So the Healy tariff is comprised of three main components. The fixed tolling tariff, a Brent-linked fee, and a TTF-linked fee that started on 1st of January of last year. We have managed to hedge our TTF-linked fees at very attractive levels, and as a result of that, we saw a very strong increase in Healy's EBITDA, generating $86 million net to us in the last quarter, which is almost three times greater than what we saw in the same quarter of 2021. Moving on to slide number nine, I wanted to provide some further details regarding the deal we did with NFE to increase our exposure on Healy. So on February 6, we agreed to acquire NFE's interest in the FLNG Healy by paying $100 million in cash, plus our remaining 4.1 million NFE shares. And also we assumed $323 billion of contractual debt. The deal is expected to close in Q1. and after that we will control 94.6% of common units that receive tolling fees from trains 1 and 2 plus 5% of the TTF fees. We will also own 89.1% of series A and B units which benefit from further upside with high rent and TTF prices. The deal brings immediate cash flow to Golar contributing an additional $70 million of EBITDA per year until the end of the current liquefaction agreement in July 2026. We believe on significant earnings upside potential with higher utilization and improved commercial terms upon recontracting at the end of the current contract. Further upside could be achieved in the next months with a potential refinancing of the existing debt. Moving on to slide 10, Let's take a closer look on the expected earnings from Healy. So on the back of our increased shareholding of 94.6% of Healy common units, the base stolen fees are expected to double in 2023 to around $138 million. Following the unwinding of our TTF swaps, we remain open for the period between March to December of this year. and we remain 100% open between 2024 until the end of the contract in 26. We also remain exposed to Brent prices and for every dollar increase in oil prices, that would result in an incremental EBITDA of $2.7 million net to us. Based on forward TTF and Brent curves, this will bring our expected EBITDA from Healey in 2023 alone of up to $335 million and around $283 million in 24. Our share of debt service is expected at around $119 million this year, resulting in free cash flow to equity of close to $216 million just from Healy. I'll now hand over the call to Karl, who can talk a bit more about some business updates.