Mr. Marc Rossiter reports

ENERFLEX LTD. PROVIDES FULL-YEAR 2023 UPDATE AND PRELIMINARY OUTLOOK FOR 2024

Enerflex Ltd. is providing a full-year 2023 update and its preliminary financial and operational outlook for 2024.

Full-year 2023 update

Based on its preliminary review of unaudited results, Enerflex estimates 2023 capital expenditures of approximately $110-million (U.S.), below its guidance range of $120-million (U.S.) to $140-million (U.S.), as it prioritized debt reduction to lower net financing costs. As at Dec. 31, 2023, Enerflex's net debt balance was less than $900-million (U.S.), which reflects gross debt repayments of approximately $120-million (U.S.) during the fourth quarter.

Outlook

Enerflex's preliminary outlook for 2024 reflects strong demand across its business units and geographic regions. The company is focused on generating free cash flow and further improving its financial flexibility.

Operating results in 2024 will be underpinned by the highly contracted energy infrastructure product line and the recurring nature of after-market services, which together are expected to account for 55 per cent to 65 per cent of the company's gross margin before depreciation and amortization. Complementing Enerflex's recurring revenue businesses is the engineered systems product line, which carried a backlog of approximately $1.5-billion ($1.1-billion (U.S.)) as at Dec. 31, 2023, and is expected to benefit from increasing natural gas production in the company's core regions. The company expects the majority of its backlog to convert into revenue over the next 12 months.

Enerflex is targeting a disciplined capital program in 2024, with total capital expenditures of $90-million (U.S.) to $110-million (U.S.). This includes a total of approximately $70-million (U.S.) for maintenance and property, plant and equipment capital expenditures. Investing to expand the company's energy infrastructure business in 2024 is discretionary and will be allocated to customer supported opportunities that are expected to generate attractive returns and deliver value to Enerflex shareholders.

Providing meaningful shareholder returns, including a sustainable dividend, continues to be a priority for Enerflex. It recognizes this has been impacted in the near term by increased leverage and interest expense. Enerflex will continue to focus on debt reduction and lowering net finance costs in 2024, which will improve its ability to provide shareholder returns over the medium and long term. The company continues to evaluate its target long-term capital structure and capital allocation parameters and expects to provide more clarity in the coming months.

Long-term fundamentals for natural gas are robust, given its critical role in supporting global decarbonization efforts and future economic growth. Enerflex is poised for long-term growth as it continues to capitalize on the growing demand for low-carbon solutions through its vertically integrated natural gas, produced water and energy transition offerings.

Fourth quarter and year-end 2023 results

Enerflex plans to release its financial results and operating highlights for the three months and year ended Dec. 31, 2023, after markets close on Wednesday, Feb. 28, 2024. Results will be communicated by news release and will be available on the company's website and under the company's SEDAR+ and EDGAR profiles.

Investors, analysts, members of the media and other interested parties are invited to participate in a conference call and audio webcast on Thursday, Feb. 29, 2024, at 8 a.m. (MST), where members of senior management will discuss the company's results. A question-and-answer period will follow.

To participate, register on-line. Once registered, participants will receive the dial-in numbers and a unique PIN to enter the call. The audio webcast of the conference call will be available on the Enerflex website under the investors section.

About Enerflex Ltd.

Transforming energy for a sustainable future. Enerflex is a premier integrated global provider of energy infrastructure and energy transition solutions, delivering natural gas processing, compression, power generation, refrigeration, cryogenic and produced water solutions.

Headquartered in Calgary, Alta., Canada, Enerflex, its subsidiaries, and interests in associates and joint ventures operate in over 85 locations in: Canada, the United States, Argentina, Bolivia, Brazil, Colombia, Mexico, Peru, the United Kingdom, the Netherlands, the United Arab Emirates, Bahrain, Oman, Egypt, Kuwait, India, Iraq, Nigeria, Pakistan, Saudi Arabia, Australia, Indonesia and Thailand.

Enerflex's common shares trade on the Toronto Stock Exchange under the symbol EFX and on the New York Stock Exchange under the symbol EFXT.

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