Teekay Tankers Ltd. Reports Fourth Quarter and Annual Results
HAMILTON, BERMUDA--(Marketwired - Feb 20, 2014) -
Highlights
- Declared a cash dividend of $0.03 per share for the quarter
ended December 31, 2013.
- Reported fourth quarter 2013 adjusted net loss attributable to
shareholders of Teekay Tankers(1) of $2.4 million, or $0.03 per
share (excluding specific items which increased GAAP net income by
$16.5 million, or $0.20 per share, including a $14.9 million
reversal of a loss provision previously recorded on the Company's
investment in term loans).
- Based on approximately 65 percent of days booked in the
quarter, average spot time-charter equivalent, or TCE, rate to date
for the first quarter of 2014 of approximately $34,300 and $25,300
per day for Teekay Tankers' spot Suezmax and Aframax vessels,
respectively, compared to $15,200 and $13,900 per day for the
fourth quarter of 2013.
- In January 2014, Teekay Tankers and Teekay Corporation jointly
created a new tanker company, Tanker Investments Limited, and each
invested $25 million for a combined 20 percent ownership interest;
and agreed in principle for Teekay Tankers to acquire Teekay
Corporation's conventional tanker commercial and technical
management operations.
- In December 2013, the detained VLCC tanker that secures one of
Teekay Tankers' term loan investments was released from Egypt and
is currently trading in the spot tanker market.
Teekay Tankers Ltd. (Teekay Tankers or the
Company) (NYSE:TNK) today reported an adjusted net loss
attributable to shareholders of Teekay Tankers(1) (as detailed in
Appendix A to this release) of $2.4 million, or $0.03 per
share, for the quarter ended December 31, 2013, compared to
adjusted net loss attributable to shareholders of Teekay Tankers of
$7.8 million, or $0.09 per share, for the same period in the prior
year. The decrease in adjusted net loss attributable to
shareholders of Teekay Tankers is primarily due to stronger Suezmax
and Aframax spot rates in the fourth quarter of 2013 compared to
the same period of the prior year and a decrease in depreciation
expense as a result of vessel impairments recorded in the fourth
quarter of 2012, partially offset by the change in employment of
certain of the Company's vessels from fixed rates to lower spot
rates upon expiry of their fixed-rate charters, lower average
realized spot tanker rates for the Company's LR2 fleet and a
reduction in interest income from the Company's investment in term
loans. Adjusted net loss attributable to shareholders of Teekay
Tankers excludes a number of specific items that had the net effect
of increasing net income attributable to shareholders of Teekay
Tankers by $16.5 million, or $0.20 per share, for the three months
ended December 31, 2013 and increasing the net loss by $348.8
million, or $4.18 per share, for the three months ended December
31, 2012, as detailed in Appendix A to this release.
Including these items, the Company reported, on a GAAP basis, net
income attributable to shareholders of Teekay Tankers of $14.1
million, or $0.17 per share, for the quarter ended December 31,
2013, compared to a net loss attributable to shareholders of Teekay
Tankers of $356.6 million, or a loss of $4.27 per share, for the
quarter ended December 31, 2012. Net revenues(2) were $39.7 million
and $44.5 million for the quarters ended December 31, 2013 and
December 31, 2012, respectively.
For the year ended December 31, 2013, the Company reported an
adjusted net loss attributable to shareholders of Teekay Tankers of
$16.3 million, or $0.20 per share, compared to adjusted net loss
attributed to the shareholders of Teekay Tankers of $11.4 million,
or $0.14 per share, for the prior year. The increase in adjusted
net loss attributable to shareholders of Teekay Tankers is
primarily due to a decrease in the Company's net voyage revenues
due to the change in employment of certain of the Company's vessels
from fixed rates to lower spot rates on expiry of their fixed-rate
charters, lower average realized spot tanker rates for the year
ended 2013 compared to the prior year and a reduction in interest
income from the Company's investment in term loans. This was
partially offset by the decrease in depreciation expense as a
result of vessel impairments recorded in the fourth quarter of
2012. Adjusted net loss attributable to shareholders of Teekay
Tankers excludes a number of specific items that had the net effect
of decreasing net loss attributable to shareholders of Teekay
Tankers by $8.2 million, or $0.10 per share, for the year ended
December 31, 2013 and increasing net loss by $349.6 million, or
$4.40 per share, for the year ended December 31, 2012, as detailed
in Appendix A to this release. Including these items, the
Company reported, on a GAAP basis, a net loss attributable to
shareholders of Teekay Tankers of $8.1 million, or $0.10 per share,
for the year ended December 31, 2013, compared to a net loss
attributable to shareholders of Teekay Tankers of $361.0 million,
or $4.54 per share, for the year ended December 31, 2012. Net
revenues(2) were $161.8 million and $192.8 million for the years
ended December 31, 2013 and December 31, 2012, respectively.
The Company's financial statements for prior periods include the
historical results of the 13 vessels acquired by the Company from
Teekay Corporation in June 2012, referred to herein as the
Dropdown Predecessor, for the periods when these vessels
were owned and operated by Teekay Corporation, which includes the
period from January to June 2012.
During the fourth quarter of 2013, the Company generated $10.4
million, or $0.12 per share, of Cash Available for Distribution(3),
compared to $8.7 million, or $0.10 per share, in the third quarter
of 2013. On January 3, 2014, Teekay Tankers declared its fixed
dividend of $0.03 per share for the fourth quarter of 2013, which
was paid on January 31, 2014 to all shareholders of record on
January 17, 2014. Since the Company's initial public offering in
December 2007, it has declared dividends in 25 consecutive
quarters, which now total $7.305 per share on a cumulative
basis.
"Crude tanker rates in December 2013 and January 2014 reached
their highest levels since the third quarter of 2008, mainly as a
result of higher crude oil imports into China, an increase in
long-haul crude oil movements from the Atlantic basin to Asia and
seasonal factors, most of which will be reflected in the financial
results for the first quarter of 2014," commented Bruce Chan,
Teekay Tankers' Chief Executive Officer. "Based on approximately 65
percent of spot revenues days booked to date in the first quarter
of 2014, the Company has earned an average time-charter equivalent,
or TCE, rate of approximately $34,300 and $25,300 per day for its
spot Suezmax and Aframax vessels, respectively, compared to $15,200
and $13,900 per day for the fourth quarter of 2013. "While rates
have softened somewhat in recent weeks, we believe stronger oil
demand, limited tanker fleet growth and improving global economic
conditions will continue to support a general firming of average
spot tanker rates starting in 2014."
Mr. Chan added, "Teekay Tankers' co-investment in Tanker
Investments Limited, or TIL, provides an additional way for Teekay
Tankers' shareholders to benefit from a potential tanker market
recovery while complementing our existing strategy of directly
owning and in-chartering conventional tankers. Teekay Tankers can
now either invest in secondhand tankers or newbuildings directly or
seek to invest further in TIL. In addition, Teekay Tankers' planned
acquisition of Teekay Corporation's conventional tanker commercial
and technical management operations represents the final step in
Teekay Tankers' evolution into a full-service conventional tanker
platform, which we believe will allow us to better serve our
customers and generate greater value for our shareholders."
|
(1) |
Adjusted net loss attributable to shareholders of Teekay Tankers is
a non-GAAP financial measure. Please refer to Appendix A
to this release for a reconciliation of this non-GAAP measure as
used in this release to the most directly comparable financial
measure under United States generally accepted accounting
principles (GAAP) and for information about specific items
affecting net loss that are typically excluded by securities
analysts in their published estimates of the Company's financial
results. |
|
(2) |
Net revenues is a non-GAAP financial measure used by certain
investors to measure the financial performance of shipping
companies. Please refer to Appendix C included in this
release for a reconciliation of this non-GAAP measure to the most
directly comparable financial measure under GAAP. |
|
(3) |
Cash Available for Distribution represents net income (loss), plus
depreciation and amortization, unrealized losses from derivatives,
non-cash items and any write-offs or other non-recurring items,
less unrealized gains from derivatives and net income attributable
to the historical results of vessels acquired by the Company from
Teekay Corporation, for the period when these vessels were owned
and operated by Teekay Corporation. Please refer to Appendix
B to this release for a reconciliation of Cash Available for
Distribution (a non-GAAP measure) as used in this release to the
most directly comparable GAAP financial measure. |
Summary of Recent
Events
First Priority VLCC Mortgage Loans
Due to an increase in tanker vessel values, in the fourth
quarter of 2013, the Company recognized $2.0 million of interest
income and recorded a $14.9 million reversal of the loss provision
on its investment in term loans secured by two 2010-built Very
Large Crude Carrier (VLCC) vessels. As a result of this
reversal, as of December 31, 2013 there is no remaining loan loss
provision associated with the term loans secured by these vessels.
The Company expects to recover the carrying value of the term
loans, including the original loan principal balance, from a
combination of the future operating cash flows of the two VLCC
vessels and the net proceeds from their eventual sale. The actual
amount recoverable from the Company's investment in the term loans
may vary from the Company's current estimates depending on various
factors, including the vessels' actual future operating cash flows
and actual net proceeds realized from the eventual sale of the
vessels.
In December 2013, the previously detained VLCC was released by
the Egyptian authorities. Currently, both VLCC vessels securing the
investment in term loans are trading in the spot tanker market
under Teekay Tankers' management. The Company continues to work
closely with the borrowers and the second priority mortgagees of
the vessels to realize on its security for the loans.
Investment in Tanker Investments Ltd.
In January 2014, Teekay Tankers and Teekay Corporation
(Teekay) jointly created Tanker Investments Limited
(TIL), which will seek to opportunistically acquire,
operate, and sell modern secondhand tankers to benefit from an
expected recovery in the current cyclical low of the tanker market.
TIL completed a $250 million equity private placement in which
Teekay Tankers and Teekay co-invested $25 million each for a
combined 20 percent ownership in the new company. The balance of
the privately placed TIL shares, which are listed on the Norwegian
over-the-counter market under the symbol "TIL", were purchased by a
group of institutional investors.
A portion of the net proceeds from the equity private placement
will be used to acquire four 2009 and 2010-built Aframax crude oil
tankers for an aggregate purchase price of approximately $116
million, which are expected to be acquired between March and June
2014, and four 2009-built Suezmax crude oil tankers for an
aggregate purchase price of approximately $163 million, which TIL
will pay for by the assuming an equal amount of indebtedness
already secured by those vessels. The four Suezmax vessels are
expected to be acquired from Teekay in late-February 2014. The
remaining proceeds will be used to acquire additional tankers and
for general corporate purposes. TIL expects to list its shares on
the Oslo Stock Exchange in March 2014.
The Teekay and Teekay Tankers' Boards of Directors have also
agreed in principle to the sale of Teekay's conventional tanker
commercial and technical management operations (Teekay
Operations) to Teekay Tankers, including direct ownership in
three commercially managed tanker pools, which currently generate
income from commercially managing a fleet of 82 vessels and
technically managing a fleet of 49 vessels. The TIL fleet also will
be managed by Teekay Operations and, upon completion of the sale of
Teekay Operations, the corresponding fees associated with the
management of TIL's vessels will be earned by Teekay Tankers.
Fixed-Rate Time-Charter Coverage
During December 2013, Teekay Tankers commenced new time-charter
out contracts for two Aframax tankers. The Erik Spirit has
been time-chartered out for a period of 12 months at a rate of
$14,100 per day and the Esther Spirit has been
time-chartered out for a period of 24 months at a time-charter rate
of $16,500 per day.
Teekay Tankers recently extended its time-charter in contract
with BM Breeze for a period of 12 months at a rate of
$12,000 per day, with options to extend up to an additional 24
months at escalating rates.
Tanker
Market
Global oil demand is expected to average 92.5 million barrels
per day (mb/d) in 2014, representing an increase of 4.1
mb/d, or 4.6 percent, compared to 2010 oil demand of 88.4 mb/d. In
recent years, oil demand growth has been more than offset by high
levels of fleet growth with the global tanker fleet growing by a
net 70.8 million deadweight tonnes (mdwt), or 16.3
percent, from the start of 2010 until January 2014. Moderate oil
demand growth, combined with high tanker fleet growth resulted in a
significant decline in crude tanker spot rates and second-hand
tanker values during the period from 2010 to the fourth quarter of
2013.
In December 2013 and January 2014, crude tanker spot rates
increased significantly, reaching their highest levels since the
third quarter of 2008, although rates for 2013 as a whole were
comparatively low on a historical basis. This recent increase was
primarily due to strong Chinese crude oil imports, an increase in
long-haul movements from the Atlantic basin to Asia, and seasonal
factors.
There are currently 61.6 mdwt of tankers on order, or
approximately 12.3 percent of the existing fleet. The tanker
orderbook has been shrinking since it peaked at 190 mdwt, or
approximately 49 percent of the fleet, in September 2008. As a
result of the smaller orderbook, the global tanker fleet is
expected to grow by only 1.2 percent in 2014 and 1.3 percent in
2015, net of removals, which is the smallest fleet growth rate
since 2001. The pace of new tanker ordering increased in 2013, with
a total of 33.6 mdwt ordered, compared to just 13.9 mdwt ordered
during 2012. From 2000 to 2012, annual orders averaged 35.8 mdwt.
However, the majority of orders placed in 2013 were for
Medium-Range (MR) and Long Range 2 (LR2) product
tankers.
In its January 2014 "World Economic Outlook", the International
Monetary Fund (IMF) raised its global GDP growth forecast
for 2014 to 3.7 percent, an increase of 0.1 percent over its
previous forecast for 2014. Global oil demand is projected to grow
by 1.2 million mb/d in 2014 based on the average of the forecasts
of the International Energy Agency, the Energy Information
Administration, and OPEC, an increase from the 1.0 mb/d of oil
demand growth in 2013. The forecasted increase in demand is based
on the cautiously positive sentiment for global economic growth,
which continues to be driven by China, although at a slower pace
than previous years. The call on OPEC is expected to decline by
around 0.6 mb/d in 2014, as non-OPEC supply, mostly driven by the
United States, continues to grow.
A combination of improving global economic conditions and
expected stronger oil demand growth coupled with limited tanker
fleet growth for 2014 and 2015, is expected to drive an increase in
tanker fleet utilization and therefore improved spot tanker rates
over the next two years.
Operating
Results
The following table highlights the operating performance of the
Company's time-charter and spot vessels measured in net voyage
revenue per revenue day, or time-charter equivalent (TCE)
rates, before related-party pool management fees, related-party
commissions and off-hire bunker expenses:
|
|
Three Months Ended |
|
|
December 31, 2013 |
September 30, 2013 |
December 31, 2012 |
|
Time-Charter Out Fleet |
|
|
|
|
|
|
|
Suezmax revenue days |
|
176 |
|
134 |
|
362 |
|
Suezmax TCE per revenue day(i) |
$ |
19,490 |
$ |
20,448 |
$ |
21,036 |
|
Aframax revenue days |
|
804 |
|
825 |
|
714 |
|
Aframax TCE per revenue day (i) |
$ |
17,189 |
$ |
17,542 |
$ |
17,769 |
|
MR revenue days |
|
92 |
|
92 |
|
276 |
|
MR TCE per revenue day(ii) |
$ |
35,054 |
$ |
35,633 |
$ |
25,287 |
|
|
|
|
|
|
|
|
|
Spot Fleet |
|
|
|
|
|
|
|
Suezmax revenue days |
|
683 |
|
716 |
|
538 |
|
Suezmax spot TCE per revenue day |
$ |
15,221 |
$ |
13,799 |
$ |
11,515 |
|
Aframax revenue days |
|
276 |
|
284 |
|
424 |
|
Aframax spot TCE per revenue day |
$ |
13,893 |
$ |
13,583 |
$ |
13,384 |
|
LR2 revenue days |
|
276 |
|
275 |
|
276 |
|
LR2 spot TCE per revenue day |
$ |
12,901 |
$ |
12,488 |
$ |
15,889 |
|
MR revenue days |
|
181 |
|
184 |
|
- |
|
MR spot TCE per revenue day |
$ |
15,772 |
$ |
15,067 |
|
- |
|
|
|
|
|
|
|
|
|
Total Fleet |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Suezmax revenue days |
|
859 |
|
850 |
|
900 |
|
Suezmax TCE per revenue day(i) |
$ |
16,096 |
$ |
14,845 |
$ |
15,345 |
|
Aframax revenue days |
|
1,080 |
|
1,109 |
|
1,138 |
|
Aframax TCE per revenue day(i) |
$ |
16,347 |
$ |
16,528 |
$ |
16,141 |
|
LR2 revenue days |
|
276 |
|
275 |
|
276 |
|
LR2 TCE per revenue day |
$ |
12,901 |
$ |
12,488 |
$ |
15,889 |
|
MR revenue days |
|
273 |
|
276 |
|
276 |
|
MR TCE per revenue day(ii) |
$ |
22,279 |
$ |
21,923 |
$ |
25,287 |
|
|
|
|
|
|
|
|
|
(i) |
Excludes profit share amounts relating to certain vessels which are
employed on fixed-rate time-charter contracts that include a
profit-sharing component. |
|
(ii) |
The
charter rate on one of the MR tankers includes approximately
$14,000 per day for the additional costs relating to Australian
crew versus international crew. |
Teekay Tankers'
Fleet
The following table summarizes the Company's fleet as of
February 1, 2014:
|
|
Owned Vessels |
Chartered-in Vessels |
Total |
|
Fixed-rate: |
|
|
|
|
Suezmax Tankers |
2 |
- |
2 |
|
Aframax Tankers |
9 |
- |
9 |
|
MR Product Tankers |
1 |
- |
1 |
|
VLCC Tanker(i) |
1 |
- |
1 |
|
Total Fixed-Rate Fleet |
13 |
- |
13 |
|
Spot-rate: |
|
|
|
|
Suezmax Tankers |
8 |
- |
8 |
|
Aframax Tankers(ii) |
2 |
1 |
3 |
|
LR2 Product Tankers |
3 |
- |
3 |
|
MR Product Tankers |
2 |
- |
2 |
|
Total Spot Fleet |
15 |
1 |
16 |
|
Total Teekay Tankers Fleet |
28 |
1 |
29 |
|
(i) |
The
Company's ownership interest in this vessel is 50 percent. |
|
(ii) |
The
Aframax tanker BM Breeze is currently time-chartered in
for a 12-month period ending in January 2015, with options to
extend up to an additional 24 months. |
Liquidity
As of December 31, 2013, the Company had total liquidity of
$173.9 million (which consisted of $25.6 million of cash and $148.3
million in an undrawn revolving credit facility), compared to total
liquidity of $226.1 million as at September 30, 2013.
Conference
Call
The Company plans to host a conference call on Thursday,
February 20, 2014 at 1:00 p.m. (ET) to discuss its results for the
fourth quarter and fiscal year of 2013. An accompanying investor
presentation will be available on Teekay Tankers' website at
www.teekaytankers.com prior to the start of the call. All
shareholders and interested parties are invited to listen to the
live conference call by choosing from the following options:
- By dialing (800) 711-9538 or
(416) 640-5925, if
outside of North America, and quoting conference ID code
6530002.
- By accessing the webcast, which will be available on Teekay
Tankers' website at www.teekaytankers.com (the archive will remain
on the website for a period of 30 days).
The conference call will be recorded and available until
Thursday, February 27, 2014. This recording can be accessed
following the live call by dialing (888) 203-1112 or
(647) 436-0148, if
outside North America, and entering access code 6530002.
About Teekay
Tankers
Teekay Tankers currently owns a fleet of 27 double-hull vessels,
including 11 Aframax tankers, 10 Suezmax tankers, three Long Range
2 (LR2) product tankers, three Medium-Range (MR)
product tankers and has one time-chartered in Aframax tanker, all
of which vessels an affiliate of Teekay Corporation (NYSE:TK)
manages through a mix of short- or medium-term fixed-rate
time-charter contracts and spot tanker market trading. The Company
also owns a Very Large Crude Carrier (VLCC) through a 50
percent-owned joint venture. Teekay Tankers was formed in December
2007 by Teekay Corporation as part of its strategy to expand its
conventional oil tanker business.
Teekay Tankers' common stock trades on the New York Stock
Exchange under the symbol "TNK."
|
TEEKAY TANKERS LTD. SUMMARY CONSOLIDATED STATEMENTS OF INCOME
(LOSS) (in thousands of U.S. dollars, except share data) |
|
|
Three Months Ended |
|
Year Ended |
|
|
|
December, 31 |
|
September, 30 |
|
December, 31 |
|
December, 31 |
|
December, 31 |
|
|
|
2013 |
|
2013 |
|
2012 |
|
2013 |
|
2012 |
|
|
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Time-charter revenues |
20,832 |
|
20,600 |
|
27,339 |
|
88,320 |
|
123,364 |
|
|
Net pool revenues |
19,205 |
|
18,879 |
|
15,241 |
|
69,675 |
|
62,328 |
|
|
Voyage charter revenue |
132 |
|
- |
|
28 |
|
4,415 |
|
238 |
|
|
Interest income from investment |
|
|
|
|
|
|
|
|
|
|
|
in term loans(1) |
1,994 |
|
- |
|
2,885 |
|
7,677 |
|
11,499 |
|
|
Total revenues |
42,163 |
|
39,479 |
|
45,493 |
|
170,087 |
|
197,429 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES |
|
|
|
|
|
|
|
|
|
|
|
Voyage expenses |
2,492 |
|
483 |
|
1,017 |
|
8,337 |
|
4,618 |
|
|
Vessel operating expenses(2) |
21,922 |
|
21,859 |
|
25,016 |
|
91,667 |
|
96,160 |
|
|
Time-charter hire expense |
1,021 |
|
1,216 |
|
841 |
|
6,174 |
|
3,950 |
|
|
Depreciation and amortization |
12,113 |
|
11,935 |
|
18,431 |
|
47,833 |
|
72,365 |
|
|
General and administrative (2) |
2,354 |
|
3,317 |
|
2,390 |
|
12,594 |
|
7,985 |
|
|
(Reversal) loss provision on investment in |
|
|
|
|
|
|
|
|
|
|
|
term loans(1) (3) |
(14,910 |
) |
10,399 |
|
- |
|
- |
|
- |
|
|
Vessel impairment and net loss on sale |
|
|
|
|
|
|
|
|
|
|
|
of vessel |
- |
|
- |
|
352,546 |
|
71 |
|
352,546 |
|
|
|
24,992 |
|
49,209 |
|
400,241 |
|
166,676 |
|
537,624 |
|
|
Income (loss) from operations |
17,171 |
|
(9,730 |
) |
(354,748 |
) |
3,411 |
|
(340,195 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
OTHER ITEMS |
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
(2,468 |
) |
(2,440 |
) |
(2,840 |
) |
(10,023 |
) |
(20,009 |
) |
|
Interest income |
63 |
|
71 |
|
14 |
|
158 |
|
50 |
|
|
Realized and unrealized (loss) gain |
|
|
|
|
|
|
|
|
|
|
|
on derivative instruments(4) |
(1,014 |
) |
(2,492 |
) |
1,263 |
|
(1,524 |
) |
(7,963 |
) |
|
Equity income (loss) from joint venture |
564 |
|
458 |
|
(1 |
) |
854 |
|
(1 |
) |
|
Other expenses |
(186 |
) |
(458 |
) |
(257 |
) |
(1,014 |
) |
(2,063 |
) |
|
|
(3,041 |
) |
(4,861 |
) |
(1,821 |
) |
(11,549 |
) |
(29,986 |
) |
|
Net income (loss) |
14,130 |
|
(14,591 |
) |
(356,569 |
) |
(8,138 |
) |
(370,181 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share attributable to shareholders of Teekay
Tankers (5) |
|
|
|
|
|
|
|
|
|
|
|
- Basic and diluted |
0.17 |
|
(0.17 |
) |
(4.27 |
) |
($0.10 |
) |
($4.54 |
) |
|
Weighted-average number of Class A |
|
|
|
|
|
|
|
|
|
|
|
common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
- Basic and diluted |
71,091,030 |
|
71,091,030 |
|
71,091,030 |
|
71,091,030 |
|
67,039,605 |
|
|
Weighted-average number of Class B |
|
|
|
|
|
|
|
|
|
|
|
common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
- Basic and diluted |
12,500,000 |
|
12,500,000 |
|
12,500,000 |
|
12,500,000 |
|
12,500,000 |
|
|
Weighted-average number of total |
|
|
|
|
|
|
|
|
|
|
|
common shares outstanding |
83,591,030 |
|
83,591,030 |
|
83,591,030 |
|
83,591,030 |
|
79,539,605 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
The amount recoverable from the Company's investment in term loans
is dependent on various factors, including the amount realizable
from the sale of two VLCCs held as collateral for the loans. The
amounts the Company ultimately may record in its annual 2013 filing
with the SEC on the Form 20-F as interest income and loss provision
on its investment in term loans for 2013 may vary from the amounts
shown above if there are significant changes in the Company's
current estimates of the value of its collateral that may be
realized. |
|
(2) |
In order to more closely align the Company's presentation to many
of its peers, the cost of ship management activities of $1.4
million and $1.4 million for the three months ended December 31,
2013 and September 30, 2013, respectively, and $5.6 million for the
year ended December 31, 2013 have been presented in vessel
operating expenses. Prior to 2013, the Company included these
amounts in general and administrative expenses. All such costs
incurred in comparative periods have been reclassified from general
and administrative expenses to vessel operating expenses to conform
to the presentation adopted in the current period. The amounts
reclassified were $1.4 million for the three months ended December
31, 2012 and $7.0 million for the year ended December 31,
2012. |
|
(3) |
A reversal of a loss provision on the Company's investment in term
loans of $14.9 million was recorded for the three months ended
December 31, 2013. Loss provisions on investment in term loans of
$10.4 million and $4.5 million had previously been recorded for the
three months ended September 30, 2013 and June 30, 2013,
respectively. As a result of the reversal, there was no remaining
loan loss provision recorded as of December 31, 2013. |
|
(4) |
Includes realized losses relating to interest rate swaps of $2.5
million, $2.5 million, and $2.4 million for the three months ended
December 31, 2013, September 30, 2013 and December 31, 2012,
respectively, and $9.9 million and $7.8 million for the years ended
December 31, 2013 and December 31, 2012, respectively. |
|
(5) |
Income (loss) per share attributable to shareholders of Teekay
Tankers is determined by dividing (a) net income (loss) of the
Company after adjusting for the amount of net loss attributable to
the Dropdown Predecessor by (b) the weighted-average number of
shares outstanding during the applicable period. |
|
|
|
|
TEEKAY TANKERS LTD. SUMMARY CONSOLIDATED BALANCE SHEETS (in
thousands of U.S. dollars) |
|
|
As at |
|
As at |
|
As at |
|
December 31, 2013 |
|
September 30, 2013 |
|
December 31, 2012 |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
ASSETS |
|
|
|
|
|
|
Cash |
25,646 |
|
29,168 |
|
26,341 |
|
Pool receivable from related parties |
10,765 |
|
7,962 |
|
9,101 |
|
Accounts receivable |
4,247 |
|
8,233 |
|
4,523 |
|
Vessel held for sale |
- |
|
- |
|
9,114 |
|
Prepaid assets |
10,361 |
|
12,630 |
|
9,714 |
|
Investment in term loans |
136,061 |
|
114,096 |
|
119,385 |
|
Due from affiliates |
27,991 |
|
26,791 |
|
24,787 |
|
Vessels and equipment |
859,308 |
|
861,377 |
|
885,992 |
|
Loan to joint venture |
9,830 |
|
9,830 |
|
9,830 |
|
Investment in joint venture |
8,366 |
|
7,802 |
|
3,457 |
|
Other non-current assets |
4,954 |
|
5,164 |
|
3,412 |
|
Total assets |
1,097,529 |
|
1,083,053 |
|
1,105,656 |
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
Accounts payable and accrued liabilities |
23,320 |
|
19,683 |
|
21,228 |
|
Current portion of long-term debt |
25,246 |
|
25,246 |
|
25,246 |
|
Current portion of derivative instruments |
7,344 |
|
6,219 |
|
7,200 |
|
Deferred revenue |
2,961 |
|
1,090 |
|
4,564 |
|
Due to affiliates |
11,323 |
|
11,430 |
|
3,592 |
|
Long-term debt |
719,388 |
|
720,921 |
|
710,455 |
|
Other long-term liabilities |
23,275 |
|
25,792 |
|
31,188 |
|
Equity |
284,672 |
|
272,672 |
|
302,183 |
|
Total liabilities and equity |
1,097,529 |
|
1,083,053 |
|
1,105,656 |
|
|
|
|
|
|
|
|
TEEKAY TANKERS LTD. SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of U.S. dollars) |
|
|
Year Ended |
|
|
December 31, 2013 |
|
December 31, 2012 |
|
|
(unaudited) |
|
(unaudited)(1) |
|
|
Cash and cash equivalents provided by (used for) |
|
|
|
|
|
|
|
|
|
|
|
OPERATING ACTIVITIES |
|
|
|
|
|
Net operating cash flow |
6,202 |
|
27,542 |
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES |
|
|
|
|
|
Proceeds from long-term debt |
59,179 |
|
32,226 |
|
|
Repayments of long-term debt |
(25,246 |
) |
(13,522 |
) |
|
Prepayment of long-term debt |
(25,000 |
) |
(60,000 |
) |
|
Proceeds from long-term debt of Dropdown Predecessor |
- |
|
2,312 |
|
|
Repayment from long-term debt of Dropdown Predecessor |
- |
|
(10,372 |
) |
|
Prepayment from long-term debt of Dropdown Predecessor |
- |
|
(15,000 |
) |
|
Acquisition of 13 vessels from Teekay Corporation |
- |
|
(9,509 |
) |
|
Net advances from affiliates |
- |
|
16,913 |
|
|
Contribution of capital from Teekay Corporation |
- |
|
9,507 |
|
|
Proceeds from issuance of Class A common stock |
- |
|
69,000 |
|
|
Share issuance costs |
- |
|
(3,229 |
) |
|
Cash dividends paid |
(10,030 |
) |
(32,231 |
) |
|
Net financing cash flow |
(1,097 |
) |
(13,905 |
) |
|
|
|
|
|
|
|
INVESTING ACTIVITIES |
|
|
|
|
|
Proceeds from sale of vessel and equipment |
9,114 |
|
- |
|
|
Expenditures for vessels and equipment |
(1,904 |
) |
(2,518 |
) |
|
Investment in joint venture |
(3,890 |
) |
(3,344 |
) |
|
Investment in term loans |
(9,120 |
) |
- |
|
|
Net investing cash flow |
(5,800 |
) |
(5,862 |
) |
|
|
|
|
|
|
|
(Decrease) increase in cash and cash equivalents |
(695 |
) |
7,775 |
|
|
Cash and cash equivalents, beginning of the year |
26,341 |
|
18,566 |
|
|
Cash and cash equivalents, end of the year |
25,646 |
|
26,341 |
|
|
(1) |
In
accordance with GAAP, the statements of cash flows for the year
ended December 31, 2012, include the Dropdown Predecessor amounts
for the 13 conventional tankers acquired by the Company from Teekay
Corporation in June 2012 to reflect ownership of the vessels for
the time they were owned and operated by Teekay Corporation. |
|
|
|
|
TEEKAY TANKERS LTD. APPENDIX A - SPECIFIC ITEMS AFFECTING NET
INCOME (LOSS) (in thousands of U.S. dollars, except per share
amounts) |
Set forth below is a reconciliation of the Company's unaudited
adjusted net income (loss) attributable to the shareholders of
Teekay Tankers, a non-GAAP financial measure, to net income (loss)
as determined in accordance with GAAP. The Company believes that,
in addition to conventional measures prepared in accordance with
GAAP, certain investors use this information to evaluate the
Company's financial performance. The items below are also typically
excluded by securities analysts in their published estimates of the
Company's financial results. Adjusted net income (loss)
attributable to the shareholders of Teekay Tankers is intended to
provide additional information and should not be considered a
substitute for measures of performance prepared in accordance with
GAAP.
|
Three Months Ended |
|
December 31, 2013 |
|
December 31, 2012 |
|
|
(unaudited) |
|
(unaudited) |
|
|
$ |
|
$ Per Share |
|
$ |
|
$ Per Share |
|
| Net income (loss) - GAAP basis |
14,130 |
|
$ |
0.17 |
|
(356,569 |
) |
$ |
(4.27 |
) |
| Net income (loss) attributable to shareholders of
Teekay Tankers |
14,130 |
|
$ |
0.17 |
|
(356,569 |
) |
|
(4.27 |
) |
| (Subtract) add specific items affecting net
income: |
|
|
|
|
|
|
|
|
|
|
|
Unrealized gain on interest rate swaps (1) |
(1,486 |
) |
$ |
(0.02 |
) |
(3,735 |
) |
|
(0.04 |
) |
|
Reversal of loss provision on investment term loans (2) |
(14,910 |
) |
$ |
(0.18 |
) |
- |
|
|
- |
|
|
Write-down of vessels and equipment (3) |
- |
|
|
- |
|
352,546 |
|
$ |
4.22 |
|
|
Other (4) |
(145 |
) |
|
- |
|
- |
|
|
- |
|
| Total adjustments |
(16,541 |
) |
$ |
(0.20 |
) |
348,811 |
|
$ |
4.18 |
|
| Adjusted net loss attributable to shareholders of
Teekay Tankers |
(2,411 |
) |
$ |
(0.03 |
) |
(7,758 |
) |
$ |
(0.09 |
) |
|
Year Ended |
|
December 31, 2013 |
|
December 31, 2012 |
|
|
(unaudited) |
|
(unaudited) |
|
|
$ |
|
$ Per Share |
|
$ |
|
$ Per Share |
|
| Net loss - GAAP basis |
(8,138 |
) |
$ |
(0.10 |
) |
(370,181 |
) |
$ |
(4.65 |
) |
| Add: |
|
|
|
|
|
|
|
|
|
|
| Net loss attributable to the Dropdown Predecessor |
- |
|
|
- |
|
9,163 |
|
$ |
0.11 |
|
| Net loss attributable to shareholders of Teekay
Tankers |
(8,138 |
) |
$ |
(0.10 |
) |
(361,018 |
) |
$ |
(4.54 |
) |
| (Subtract) add specific items affecting net
income: |
|
|
|
|
|
|
|
|
|
|
|
Unrealized gain on interest rate swaps (1) |
(8,363 |
) |
$ |
(0.10 |
) |
(3,810 |
) |
$ |
(0.04 |
) |
|
Write-down of vessels and equipment/ loss on sale (3) |
71 |
|
|
- |
|
352,546 |
|
$ |
4.43 |
|
|
Other (4) |
126 |
|
|
- |
|
840 |
|
$ |
0.01 |
|
| Total adjustments |
(8,166 |
) |
$ |
(0.10 |
) |
349,576 |
|
$ |
4.40 |
|
| Adjusted net loss attributable to shareholders of
Teekay Tankers |
(16,304 |
) |
$ |
(0.20 |
) |
(11,442 |
) |
$ |
(0.14 |
) |
|
(1) |
Reflects the unrealized gain or loss due to changes in the
mark-to-market value of derivative instruments that are not
designated as hedges for accounting purposes. |
|
(2) |
Reversal of the loan loss provision was recorded for the three
months ended December 31, 2013. The full reversal of the loan loss
provision was due to the increase in the value of the two VLCCs
securing the Company's investment in term loans. |
|
(3) |
The
amount for the year ended December 31, 2012 relates to impairment
charges associates with the Company's Suezmax tankers, certain of
its older Aframax tankers, and one MR product tanker. |
|
(4) |
The
amount recorded for the three months ended December 31, 2013 and
the year ended December 31, 2013, relates to the 50-percent portion
of an unrealized derivative instrument loss recorded by the High Q
Joint Venture, which owns the VLCC newbuilding that delivered in
June 2013. The amount for the year ended December 31, 2012 relates
to the transaction costs related to the acquisition costs of the 13
conventional tankers acquired in June 2012. |
|
|
|
|
TEEKAY TANKERS LTD. APPENDIX B - RECONCILIATION OF NON-GAAP
FINANCIAL MEASURE CASH AVAILABLE FOR DISTRIBUTION (in thousands of
U.S. dollars, except share and per share data) |
Description of Non-GAAP Financial Measure - Cash Available for
Distribution
Cash Available for Distribution (CAD) represents net income,
plus depreciation and amortization, unrealized losses from
derivatives, non-cash items, CAD from the VLCC joint venture and
any write-offs or other non-recurring items, less unrealized gains
from derivatives and equity income from the joint venture.
|
Three Months Ended |
|
December 31, 2013 |
|
(unaudited) |
|
|
|
| Net income for the period |
14,130 |
|
|
|
|
| Add: |
|
|
|
Depreciation and amortization |
12,113 |
|
|
Proportionate share of cash available for distribution from joint
venture |
939 |
|
|
Other |
210 |
|
| Less: |
|
|
|
Reversal of loss provision on investment in term loans |
(14,910 |
) |
|
Equity income from joint venture |
(564 |
) |
|
|
Unrealized gain on interest rate swaps |
(1,486 |
) |
| Cash Available for Distribution |
10,432 |
|
|
|
|
| Weighted average number of common shares outstanding
for the quarter |
83,591,030 |
|
|
|
|
| Cash Available for Distribution per share
(rounded) |
$0.12 |
|
|
|
|
|
|
TEEKAY TANKERS LTD. APPENDIX C - RECONCILIATION OF NON-GAAP
FINANCIAL MEASURE NET REVENUES (in thousands of U.S. dollars) |
Description of Non-GAAP Financial Measure - Net Revenues
Net revenues represents revenues less voyage expenses where
voyage expenses is comprised of all expenses relating to certain
voyages, including bunker fuel expenses, port fees, canal tolls and
brokerage commissions. Net revenues is a non-GAAP financial measure
used by certain investors to measure the financial performance of
shipping companies; however, it is not required by GAAP and should
not be considered as an alternative to revenues or any other
indicator of the Company's performance required by GAAP.
|
|
Three Months Ended |
|
Year ended |
|
|
|
December 31, |
|
September 30, |
|
December 31, |
|
December 31, |
|
December 31, |
|
|
|
2013 |
|
2013 |
|
2012 |
|
2013 |
|
2012 |
|
|
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
(unaudited) |
|
|
Revenues |
42,163 |
|
39,479 |
|
45,493 |
|
170,087 |
|
197,429 |
|
|
Voyage expenses |
(2,492 |
) |
(483 |
) |
(1,017 |
) |
(8,337 |
) |
(4,618 |
) |
|
Net revenues |
39,671 |
|
38,996 |
|
44,476 |
|
161,750 |
|
192,811 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FORWARD LOOKING STATEMENTS |
This release contains forward-looking statements (as defined in
Section 21E of the Securities Exchange Act of 1934, as amended)
which reflect management's current views with respect to certain
future events and performance, including statements regarding: the
crude oil and refined product tanker market fundamentals, including
the balance of supply and demand in the tanker market, spot tanker
rates and the potential for a tanker market recovery; the Company's
financial stability and ability to benefit from a tanker market
recovery; the Company's ability to take advantage of growth
opportunities in a future tanker market recovery; the Company's
acquisition of Teekay's conventional tanker commercial and
technical management operations and the related effect on the
Company; the Company's investment in TIL, potential benefits to the
Company, and TIL's proposed vessels acquisitions and Oslo Stock
Exchange listing; and the amount recoverable from the Company's
investments in loans secured by two 2010-built VLCCs and the timing
and certainty for the potential sale of these vessels.
The following factors are among those that could cause actual
results to differ materially from the forward-looking statements,
which involve risks and uncertainties, and that should be
considered in evaluating any such statement: changes in the
production of or demand for oil; changes in trading patterns
significantly affecting overall vessel tonnage requirements;
greater or less than anticipated levels of tanker newbuilding
orders or greater or less than anticipated rates of tanker
scrapping; changes in applicable industry laws and regulations and
the timing of implementation of new laws and regulations; the
potential for early termination of short- or medium-term contracts
and inability of the Company to renew or replace short- or
medium-term contracts; changes in interest rates and the capital
markets; failure of TIL to achieve market acceptance, obtain growth
opportunities or list its shares on the Oslo Exchange; changes in
future charter rates and the market value of the VLCCs securing the
Company's investment in term loans; the ability of Teekay Tankers
to operate or sell the VLCC tankers, and the cash flow and sale
proceeds thereof; increases in the Company's expenses, including
any dry docking expenses and associated off-hire days; failure by
the Company and Teekay to negotiate or complete the sale of the
conventional tanker technical and commercial management operations;
failure of Teekay Tankers Board of Directors and its Conflicts
Committee to accept future acquisitions of vessels that may be
offered by Teekay Corporation or third parties; and other factors
discussed in Teekay Tankers' filings from time to time with the
United States Securities and Exchange Commission, including its
Report on Form 20-F for the fiscal year ended December 31, 2012.
The Company expressly disclaims any obligation or undertaking to
release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in the Company's
expectations with respect thereto or any change in events,
conditions or circumstances on which any such statement is
based.
Teekay Tankers Ltd. - Investor Relations EnquiriesRyan
Hamilton+1 (604) 844-6654www.teekaytankers.com
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