Highlights
Teekay Offshore GP LLC (TOO GP), the general partner of Teekay
Offshore Partners L.P. (Teekay Offshore or the Partnership)
(NYSE:TOO), today reported the Partnership’s results for the
quarter ended March 31, 2018.
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
December 31, |
March 31, |
|
|
2018 |
2017 (2) |
2017 |
(in thousands of U.S. Dollars) |
(unaudited) |
(unaudited) |
(unaudited) |
GAAP FINANCIAL COMPARISON |
|
|
|
Revenues |
323,199 |
|
295,728 |
|
276,138 |
|
Income from
vessel operations |
19,498 |
|
51,026 |
|
60,458 |
|
Equity
income |
13,998 |
|
2,126 |
|
4,475 |
|
Net
income |
16,060 |
|
16,037 |
|
21,263 |
|
Net income
attributable to the partners and preferred unitholders |
23,919 |
|
15,399 |
|
18,891 |
|
NON-GAAP FINANCIAL COMPARISON |
|
|
|
Total cash
flow from vessel operations (CFVO) (1) |
161,538 |
|
144,903 |
|
141,289 |
|
Distributable cash flow (DCF) (1) |
39,359 |
|
34,449 |
|
30,633 |
|
Adjusted
net income attributable to the partners and preferred unitholders
(1) |
13,701 |
|
11,329 |
|
15,157 |
|
(1) These are
non-GAAP financial measures. Please refer to “Definitions and
Non-GAAP Financial Measures” and the Appendices to this release for
definitions of these terms and reconciliations of these non-GAAP
financial measures as used in this release to the most directly
comparable financial measures under United States generally
accepted accounting principles (GAAP). |
(2) Please refer
to Appendices to the release announcing the results for the fourth
quarter of 2017 attached as Exhibit 1 to the Form 6-K filed with
the Securities and Exchange Commission on February 22, 2018, for a
reconciliation of these non-GAAP measures to the most directly
comparable financial measures under GAAP. |
|
GAAP net income and non-GAAP adjusted net income
decreased for the first quarter of 2018, compared to the same
quarter of the prior year. Lower earnings from the Partnership's
towage fleet and non-recurring repair and maintenance expenses in
the first quarter of 2018 relating to two of the Partnership's
redelivered shuttle tankers were offset by revenue earned from the
commencement of operations of the Pioneiro de Libra FPSO in
November 2017, the Randgrid FSO in October 2017, and the Beothuk
Spirit and Norse Spirit shuttle tankers in December 2017 and
January 2018, respectively. GAAP net income for the first quarter
of 2018, compared to the same quarter of the prior year, was also
negatively impacted by the write-down of two of the Partnership's
shuttle tankers and an increase in depreciation expense due to
changes in accounting estimates, partially offset by an increase in
unrealized gains on derivative instruments.
CEO Commentary
“With the recent contract start-up of the
Petrojarl I FPSO and the third East Coast Canada shuttle tanker
newbuilding now delivered, we have completed all of our near-term
growth projects,” commented Ingvild Sæther, President and CEO of
Teekay Offshore Group Ltd. “Since September 2017, we have
delivered one FSO unit, two FPSO units and three East Canada
shuttle tanker newbuildings, and each project has now commenced its
long-term charter contract with high-quality customers. These
projects are expected to collectively generate annual cash flow
from vessel operations of approximately $200 million, some of which
has not yet been fully reflected in our financial results, which is
also expected to naturally delever our balance sheet over
time.”
“During the first quarter of 2018, we also
finalized the contract extension on the Voyageur Spirit FPSO with
Premier Oil to extend production to at least April 2019 at a lower
fixed-rate, and with the continuing strong oil price fundamentals,
we believe this contract could be extended further.” Ms.
Saether continued, “Looking ahead, with a stronger balance sheet,
market-leading positions, operational excellence and strong and
supportive sponsors, we believe Teekay Offshore is well-positioned
to benefit from the expected strong demand for offshore production,
storage and transportation.”
Summary of Recent Events
Growth Projects Update
In May 2018, the Petrojarl I FPSO successfully
achieved first oil and commenced its five-year charter contract
with a consortium led by Queiroz Galvão Exploração e Produção SA
(QGEP) on the Atlanta oil field, which is the Petrojarl I FPSO’s
tenth field over its lifetime. The Petrojarl I FPSO is
expected to generate annualized cash flow from vessel operations(1)
of approximately $25 million(2) for the first 18 months, increasing
to annualized cash flow from vessel operations(1) of approximately
$55 million(2), plus additional potential upside from oil price
tariffs.
In late-2017 and March 2018, the Partnership
took delivery of its last two of three East Coast of Canada shuttle
tanker newbuildings, the Norse Spirit and Dorset Spirit, which
commenced their respective long-term charter contracts in January
and May 2018, respectively, with a group of companies that includes
Canada Hibernia Holding Corporation, Chevron Canada, Exxon Mobil,
Husky Energy, Mosbacher Operating Ltd., Murphy Oil, Nalcor Energy,
Statoil and Suncor Energy. The Norse Spirit and Dorset Spirit
replaced existing owned and in-chartered vessels servicing the East
Coast of Canada, both of which have been repositioned to the North
Sea to operate in the Partnership’s contract of affreightment (CoA)
portfolio.
In February 2018, the Partnership took delivery
of the last of four state-of-the-art SX-157 Ulstein Design
ultra-long distance towing and offshore installation newbuildings,
the ALP Keeper, constructed by Niigata Shipbuilding & Repair in
Japan.
Recontracting of FPSO Units
In April 2018, the Partnership signed the
previously-announced contract extension with Premier Oil to extend
the employment of the Voyageur Spirit FPSO on the Huntington field
to at least April 2019. The new contract, which took effect in
April 2018, includes a lower fixed charter rate component plus a
component based on oil production and oil price.
ALP Contract Award
In February 2018, ALP Maritime, the
Partnership’s towage subsidiary, was awarded a contract to provide
five vessels to perform mobilization and field installation
services for the Kaombo Norte FPSO. The contract commenced in
mid-March 2018 and is expected to require approximately 330 vessel
equivalent days to service the project.
Financing Update
In March 2018, Teekay Offshore refinanced its
existing $250.0 million debt facility secured by the Partnership’s
three East Coast Canada shuttle tankers with a new five-year $265.8
million debt facility.
The Partnership has reached an agreement in principle with the
lenders of the Arendal Spirit UMS debt facility to extend the
mandatory principal repayment date by one year to September 2019 in
exchange for a partial principal repayment in September 2018.
|
(1) These are
non-GAAP financial measures. Please refer to “Definitions and
Non-GAAP Financial Measures” and the Appendices to this release for
definitions of these terms and reconciliations of these non-GAAP
financial measures as used in this release to the most directly
comparable financial measures under GAAP. |
(2) Excludes the
impact of any potential liquidated damages relating to project
delays and non-cash revenues. |
|
Operating Results
The following table highlights certain financial
information for Teekay Offshore’s six segments: the FPSO segment,
the shuttle tanker segment, the FSO segment, the UMS segment, the
towage segment and the conventional tanker segment (please refer to
the “Teekay Offshore’s Fleet” section of this release below and
Appendices C through E for further details).
|
|
|
Three Months Ended |
|
March 31, 2018 |
(in thousands of U.S. Dollars) |
(unaudited) |
|
FPSO Segment |
Shuttle Tanker Segment |
FSO Segment |
UMS Segment |
Towage Segment |
Conventional Tanker Segment |
Eliminations(ii) |
Total |
GAAP
FINANCIAL COMPARISON |
|
|
|
|
|
|
|
|
Revenues |
134,238 |
|
143,856 |
|
33,397 |
|
— |
|
7,611 |
|
5,017 |
|
(920 |
) |
323,199 |
|
Income
(loss) from vessel operations |
34,534 |
|
(7,420 |
) |
10,034 |
|
(4,314 |
) |
(10,309 |
) |
(2,509 |
) |
(518 |
) |
19,498 |
|
Equity
income |
13,998 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
13,998 |
|
NON-GAAP
FINANCIAL COMPARISON |
|
|
|
|
|
|
|
CFVO from
(used for) consolidated vessels (i) |
65,174 |
|
62,600 |
|
22,929 |
|
(2,661 |
) |
(5,924 |
) |
(2,509 |
) |
— |
|
139,609 |
|
CFVO from
equity-accounted vessels (i) |
21,929 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
21,929 |
|
Total CFVO (i) |
87,103 |
|
62,600 |
|
22,929 |
|
(2,661 |
) |
(5,924 |
) |
(2,509 |
) |
— |
|
161,538 |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
March 31, 2017 |
(in thousands of U.S. Dollars) |
(unaudited) |
|
FPSO Segment |
Shuttle Tanker Segment |
FSO Segment |
UMS Segment |
Towage Segment |
Conventional Tanker Segment |
Eliminations |
Total |
GAAP
FINANCIAL COMPARISON |
|
|
|
|
|
|
|
|
Revenues |
112,855 |
|
136,233 |
|
11,489 |
|
827 |
|
10,898 |
|
3,836 |
|
— |
|
276,138 |
|
Income
(loss) from vessel operations |
32,980 |
|
37,072 |
|
3,032 |
|
(9,283 |
) |
(2,938 |
) |
(405 |
) |
— |
|
60,458 |
|
Equity
income |
4,475 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
4,475 |
|
NON-GAAP
FINANCIAL COMPARISON |
|
|
|
|
|
|
|
CFVO from
(used for) consolidated vessels (i) |
65,444 |
|
67,718 |
|
7,372 |
|
(7,650 |
) |
440 |
|
(405 |
) |
— |
|
132,919 |
|
CFVO from
equity-accounted vessels (i) |
8,370 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
8,370 |
|
Total CFVO (i) |
73,814 |
|
67,718 |
|
7,372 |
|
(7,650 |
) |
440 |
|
(405 |
) |
— |
|
141,289 |
|
- These are non-GAAP financial measures. Please refer to
“Definitions and Non-GAAP Financial Measures” and the Appendices to
this release for definitions of these terms and reconciliations of
these non-GAAP financial measures as used in this release to the
most directly comparable financial measures under GAAP.
- Includes revenues and expenses earned and incurred between
segments of Teekay Offshore, during the three months ended
March 31, 2018.
FPSO Segment
Income from vessel operations remained
consistent and total cash flow from vessel operations (including
equity-accounted vessels) increased for the three months ended
March 31, 2018, compared to the same quarter of the prior year,
primarily due to the commencement of operations of the
Partnership's 50 percent-owned Pioneiro de Libra FPSO in
late-November 2017.
Shuttle Tanker Segment
Income from vessel operations and cash flow from
vessel operations decreased for the three months ended March 31,
2018, compared to the same quarter of the prior year, primarily due
to the redelivery of the Nordic Brasilia and Nordic Rio in August
2017 and October 2017, respectively, and non-recurring repair and
maintenance expenses incurred during the first quarter of 2018 to
prepare these vessels for trade in the conventional tanker market,
the dry docking of one vessel during the first quarter of 2018 and
the sale of the Navion Marita in November 2017, partially offset by
the commencement of the charter contracts in the East Coast of
Canada for the Beothuk Spirit and Norse Spirit in December 2017 and
January 2018, respectively, and higher charter renewal rates for
the Petronordic and Petroatlantic commencing from April 2017.
Income from vessel operations for the three months ended March 31,
2018 was also negatively impacted by the write-downs of the Nordic
Spirit and the Stena Spirit and an increase in depreciation expense
due to changes in accounting estimates.
FSO Segment
Income from vessel operations and cash flow from
vessel operations increased for the three months ended March 31,
2018, compared to the same quarter of the prior year, primarily due
to the commencement of the Randgrid FSO charter contract in October
2017.
UMS Segment
Income from vessel operations and cash flow from
vessel operations increased for the three months ended March 31,
2018, compared to the same quarter of the prior year, primarily due
to lower operating expenses as a result of the lay-up of the
Arendal Spirit UMS since the fourth quarter of 2017.
Towage Segment
Income from vessel operations and cash flow from
vessel operations decreased for the three months ended March 31,
2018, compared to the same quarter of the prior year, reflecting
the challenging towage markets.
Conventional Tanker Segment
Income from vessel operations and cash flow from
vessel operations decreased for the three months ended March 31,
2018, compared to the same quarter of the prior year, primarily due
to the termination of the Blue Power time-charter-out contract in
the fourth quarter of 2017 and subsequent trading of the vessel in
the weak spot conventional tanker market during the first quarter
of 2018. The time-charter-in contracts for both of the conventional
tankers included in this segment are scheduled to expire in March
2019.
Teekay Offshore’s Fleet
The following table summarizes Teekay Offshore’s
fleet as of May 1, 2018.
|
|
|
Number of Vessels |
|
Owned Vessels |
Chartered-in Vessels |
Committed Newbuildings |
Total |
FPSO Segment |
8 |
|
(i) |
— |
|
|
— |
|
|
8 |
|
|
Shuttle Tanker
Segment |
30 |
|
(ii) |
2 |
|
|
4 |
|
(iii) |
36 |
|
|
FSO Segment |
6 |
|
|
— |
|
|
— |
|
|
6 |
|
|
UMS Segment |
1 |
|
|
— |
|
|
— |
|
|
1 |
|
|
Towage Segment |
10 |
|
|
— |
|
|
— |
|
|
10 |
|
|
Conventional
Segment |
— |
|
|
2 |
|
|
— |
|
|
2 |
|
|
Total |
55 |
|
|
4 |
|
|
4 |
|
|
63 |
|
|
- Includes two FPSO units, the Cidade de Itajai and Pioneiro de
Libra, in which Teekay Offshore’s ownership interest is 50 percent
and the upgraded Petrojarl I FPSO, which commenced operations
early-May 2018.
- Includes six shuttle tankers in which Teekay Offshore’s
ownership interest is 50 percent and one HiLoad DP unit.
- Includes four Suezmax-size DP2 shuttle tanker newbuildings
scheduled for delivery in late-2019 through 2020, two of which will
operate under Teekay Offshore's master agreement with Statoil and
two of which will join Teekay Offshore's CoA portfolio in the North
Sea.
Liquidity Update
As of March 31, 2018, the Partnership had
total liquidity of $350.9 million (comprised of $225.9 million in
cash and cash equivalents and $125.0 million in undrawn credit
facilities), excluding $9.5 million included in restricted cash
relating to amounts deposited in escrow to pre-fund a portion of
the remaining Petrojarl I FPSO upgrade project costs.
In March 2018, the Partnership entered into an
18-month $125.0 million unsecured revolving credit facility, of
which $25.0 million is being provided by Teekay Corporation and
$100.0 million is being provided by Brookfield Business Partners
L.P.,together with institutional partners. The $125.0 million
facility was undrawn as at March 31, 2018 and is included in the
Partnership's total liquidity of $350.9 million as of that
date.
Conference Call
The Partnership plans to host a conference call
on Thursday, May 17, 2018 at 12:00 p.m. (ET) to discuss the
results for the first quarter of 2018. All unitholders and
interested parties are invited to listen to the live conference
call by choosing from the following options:
- By dialing 1-800-239-9838 or 647-794-4605, if outside North
America, and quoting conference ID code 7086576.
- By accessing the webcast, which will be available on Teekay
Offshore's website at www.teekay.com (the archive will remain on
the website for a period of one year).
An accompanying First Quarter 2018 Earnings
Presentation will also be available at www.teekay.com in advance of
the conference call start time.
About Teekay Offshore Partners
L.P.
Teekay Offshore Partners L.P. is an
international provider of marine transportation, oil production,
storage, long-distance towing and offshore installation and
maintenance and safety services to the oil industry, primarily
focusing on oil production-related activities of its customers and
operating in offshore oil regions of the North Sea, Brazil and the
East Coast of Canada. Teekay Offshore is structured as a
publicly-traded master limited partnership (MLP) with consolidated
assets of approximately $5.7 billion, comprised of 63 offshore
assets, including floating production, storage and offloading
(FPSO) units, shuttle tankers, floating storage and offtake (FSO)
units, a unit for maintenance and safety (UMS), long-distance
towing and offshore installation vessels and conventional tankers.
The majority of Teekay Offshore's fleet is employed on medium-term,
stable contracts.
Teekay Offshore's common units and preferred
units trade on the New York Stock Exchange under the symbols "TOO",
"TOO PR A", "TOO PR B" and "TOO PR E", respectively.
For Investor Relations enquiries contact:
Ryan HamiltonTel: +1 (604) 609-2963Website:
www.teekay.com
Definitions and Non-GAAP Financial
Measures
This release includes various financial measures
that are non-GAAP financial measures as defined under the rules of
the U.S. Securities and Exchange Commission. These non-GAAP
financial measures, which include Cash Flow from Vessel Operations,
Adjusted Net Income, and Distributable Cash Flow are intended to
provide additional information and should not be considered a
substitute for measures of performance prepared in accordance with
GAAP. In addition, these measures do not have standardized
meanings, and may not be comparable to similar measures presented
by other companies. The Partnership believes that certain investors
use this information to evaluate the Partnership’s financial
performance, as does management.
Non-GAAP Financial Measures
Cash Flow From (Used For) Vessel Operations
(CFVO) represents income (loss) from vessel operations before
depreciation and amortization expense, amortization of in-process
revenue contracts, vessel write-downs, gains or losses on the sale
of vessels, write-off of deferred revenues and operating expenses
and adjustments for direct financing leases to a cash basis, but
includes realized gains or losses on the settlement of foreign
currency forward contracts. CFVO from Consolidated Vessels
represents CFVO from vessels that are consolidated on the
Partnership’s financial statements. CFVO from Equity-Accounted
Vessels represents the Partnership’s proportionate share of CFVO
from its equity-accounted vessels. The Partnership does not control
its equity-accounted vessels and as a result, the Partnership does
not have the unilateral ability to determine whether the cash
generated by its equity-accounted vessels is retained within the
entities in which the Partnership holds the equity-accounted
investments or distributed to the Partnership and other owners. In
addition, the Partnership does not control the timing of such
distributions to the Partnership and other owners. Consequently,
readers are cautioned when using total CFVO as a liquidity measure
as the amount contributed from CFVO from Equity-Accounted Vessels
may not be available to the Partnership in the periods such CFVO is
generated by its equity-accounted vessels. CFVO is a non-GAAP
financial measure used by certain investors and management to
measure the operational financial performance of companies. Please
refer to Appendices D and E of this release for reconciliations of
these non-GAAP financial measures to income (loss) from vessel
operations and income from vessel operations of equity-accounted
vessels, respectively, the most directly comparable GAAP measures
reflected in the Partnership’s consolidated financial
statements.
Adjusted Net Income excludes items of income or
loss from GAAP net income that are typically excluded by securities
analysts in their published estimates of the Partnership’s
financial results. The Partnership believes that certain investors
use this information to evaluate the Partnership’s financial
performance, as does management. Please refer to Appendix A of this
release for a reconciliation of this non-GAAP financial measure to
net income, the most directly comparable GAAP measure reflected in
the Partnership’s consolidated financial statements.
Distributable Cash Flow (DCF) represents GAAP
net income adjusted for depreciation and amortization expense,
deferred income tax expense or recovery, vessel write-downs, gains
or losses on the sale of vessels, vessel and business acquisition
costs, distributions relating to equity financing of newbuilding
installments and conversion costs, pre-operational expenses,
distributions on the Partnership's preferred units, gains on
extinguishment of contingent liabilities and losses on non-cash
accruals of contingent liabilities, amortization of the non-cash
portion of revenue contracts, estimated maintenance capital
expenditures, unrealized gains and losses from non-designated
derivative instruments, unrealized foreign exchange gains and
losses, ineffectiveness for derivative instruments designated as
hedges for accounting purposes, adjustments for direct financing
leases to a cash basis and foreign exchange related items,
including the Partnership's proportionate share of such items in
equity-accounted for investments and non-controlling interests
proportionate share of such interests. Maintenance capital
expenditures represent those capital expenditures required to
maintain over the long-term the operating capacity of, or the
revenue generated by, the Partnership's capital assets. DCF is a
quantitative standard used in the publicly-traded partnership
investment community and by management to assist in evaluating
financial performance. Please refer to Appendix B of this release
for a reconciliation of this non-GAAP financial measure to net
income, the most directly comparable GAAP measure reflected in the
Partnership’s consolidated financial statements.
Teekay Offshore Partners L.P.Summary
Consolidated Statements of Income(in thousands of U.S.
Dollars, except unit data)
|
|
Three Months Ended |
|
|
March 31, |
December 31, |
March 31, |
|
|
2018 |
2017 |
2017 |
|
|
(unaudited) |
(unaudited) |
(unaudited) |
|
|
|
|
|
Revenues |
323,199 |
|
295,728 |
|
276,138 |
|
|
|
|
|
|
Voyage
expenses |
(35,006 |
) |
(29,005 |
) |
(25,141 |
) |
Vessel
operating expenses |
(115,382 |
) |
(98,100 |
) |
(78,990 |
) |
Time-charter hire expenses |
(12,727 |
) |
(18,375 |
) |
(21,756 |
) |
Depreciation and amortization (1) |
(94,304 |
) |
(85,658 |
) |
(74,726 |
) |
General and
administrative |
(17,786 |
) |
(14,383 |
) |
(14,617 |
) |
(Write-down) and gain on sale of vessels (2) |
(28,496 |
) |
148 |
|
— |
|
Restructuring recovery (charge) |
— |
|
671 |
|
(450 |
) |
Income from vessel operations |
19,498 |
|
51,026 |
|
60,458 |
|
|
|
|
|
Interest
expense |
(41,573 |
) |
(43,365 |
) |
(36,104 |
) |
Interest
income |
658 |
|
1,245 |
|
346 |
|
Realized
and unrealized gain (loss) |
|
|
|
|
on derivative
instruments (3) |
34,450 |
|
4,708 |
|
(6,532 |
) |
Equity
income |
13,998 |
|
2,126 |
|
4,475 |
|
Foreign
currency exchange loss (4) |
(1,943 |
) |
(693 |
) |
(223 |
) |
Other (expense) income - net |
(3,270 |
) |
(3,197 |
) |
222 |
|
Income before income tax (expense) recovery |
21,818 |
|
11,850 |
|
22,642 |
|
Income tax
(expense) recovery |
(5,758 |
) |
4,187 |
|
(1,379 |
) |
Net income |
16,060 |
|
16,037 |
|
21,263 |
|
|
|
|
|
Non-controlling interests in net income |
(7,859 |
) |
638 |
|
2,372 |
|
Preferred
unitholders' interest in net income |
7,370 |
|
5,376 |
|
12,386 |
|
General
partner’s interest in net income |
126 |
|
76 |
|
130 |
|
Limited
partners’ interest in net income |
16,423 |
|
9,947 |
|
6,375 |
|
|
|
|
|
|
Weighted-average number of common units: |
|
|
|
-
basic |
410,101,480 |
|
410,045,210 |
|
148,633,906 |
|
-
diluted |
475,447,576 |
|
475,360,951 |
|
149,662,366 |
|
Total
number of common units outstanding |
|
|
|
|
at end
of period |
410,260,795 |
|
410,045,210 |
|
149,718,936 |
|
(1) The
Partnership's shuttle tankers are comprised of two components: i) a
conventional tanker (the “tanker component”) and ii) specialized
shuttle equipment (the “shuttle component”). The Partnership
differentiated these two components on the principle that a shuttle
tanker can also operate as a conventional tanker without the use of
the shuttle component. The economics of this alternate use depend
on the supply and demand fundamentals in the two segments.
Historically, the Partnership has assessed the useful life of the
tanker component as being 25 years and the shuttle component as
being 20 years. During the three months ended March 31, 2018, the
Partnership has considered challenges associated with shuttle
tankers that have approached 20 years of age in recent years and
has reassessed the useful life of the tanker component to be 20
years. This change in estimate, commencing January 1, 2018, impacts
21 vessels in the Partnership's shuttle tanker fleet. Separately,
the Partnership has reviewed the residual value for seven vessels
in its fleet that are 17 years of age or older and, as a result of
a change in current estimated recycling values, has decreased the
residual value for these vessels. The effect of these changes in
estimates increased depreciation expense and decreased net income
by $5.4 million for the three months ended March 31, 2018. |
(2) During the
three months ended March 31, 2018, the Partnership incurred a
write-down of $28.5 million related to two older shuttle tankers
($14.2 million which relates to one shuttle tanker the Partnership
owns through a 50 percent-owned subsidiary), due to the expected
redelivery of these vessels from their charterer after completing
their bareboat charter contracts in April 2018 and the resulting
change in the expectations for the future employment opportunities
for the vessels. |
(3) Realized
(loss) gain on derivative instruments relates to amounts the
Partnership actually paid to settle derivative instruments, and the
unrealized gain (loss) on derivative instruments relates to the
change in fair value of such derivative instruments. During the
three months ended March 31, 2018, the Partnership recorded $10.0
million of fees related to the historical amendment of certain
interest rate swaps which are included in the realized loss
relating to interest rate swaps in the table below. |
|
|
Three Months Ended |
|
|
March 31, |
December 31, |
March 31, |
|
2018 |
2017 |
2017 |
Realized (loss) gain relating to: |
|
|
|
|
Interest rate
swaps |
(17,143 |
) |
(8,360 |
) |
(10,666 |
) |
|
Foreign currency
forward contracts |
618 |
|
260 |
|
(100 |
) |
|
|
(16,525 |
) |
(8,100 |
) |
(10,766 |
) |
|
|
|
|
|
Unrealized gain (loss) relating to: |
|
|
|
|
Interest rate
swaps |
49,300 |
|
14,017 |
|
3,503 |
|
|
Foreign currency
forward contracts |
1,675 |
|
(1,209 |
) |
731 |
|
|
|
50,975 |
|
12,808 |
|
4,234 |
|
Total
realized and unrealized gain (loss) on |
|
|
|
|
derivative instruments |
34,450 |
|
4,708 |
|
(6,532 |
) |
(4) The
Partnership entered into cross currency swaps to economically hedge
the foreign currency exposure on the payment of interest and
repayment of principal amounts of the Partnership’s Norwegian
Kroner (NOK) bonds. In addition, the cross currency swaps
economically hedge the interest rate exposure on the NOK bonds. The
Partnership has not designated, for accounting purposes, these
cross currency swaps as cash flow hedges of its NOK bonds and,
thus, foreign currency exchange loss includes a realized loss
relating to the amounts the Partnership paid to settle its
non-designated cross currency swaps and an unrealized gain relating
to the change in fair value of such swaps, partially offset by an
unrealized loss on the revaluation of the NOK bonds, as detailed in
the table below. In addition, during the three months ended
December 31, 2017, the Partnership recorded realized losses of
$33.3 million relating to the termination of certain cross currency
swaps which were offset by unrealized gains on the cross currency
swaps of $33.3 million, which are included in the table below. |
|
Three Months Ended |
|
March 31, |
December 31, |
March 31, |
|
2018 |
2017 |
2017 |
Realized loss on cross
currency swaps |
(1,293 |
) |
(34,704 |
) |
(3,204 |
) |
Unrealized gain on
cross currency swaps |
6,338 |
|
24,936 |
|
4,379 |
|
Unrealized loss on revaluation of NOK bonds |
(5,641 |
) |
(57,937 |
) |
(1,261 |
) |
Teekay Offshore Partners
L.P.Consolidated Balance Sheets(in
thousands of U.S. Dollars)
|
|
As at |
As at |
|
|
March 31, 2018 |
December 31, 2017 |
|
|
(unaudited) |
(unaudited) |
ASSETS |
|
|
Current |
|
|
Cash and
cash equivalents |
225,892 |
|
221,934 |
|
Restricted
cash |
15,814 |
|
28,360 |
|
Accounts
receivable |
137,054 |
|
162,691 |
|
Prepaid
expenses |
36,815 |
|
30,336 |
|
Due from
affiliates |
39,871 |
|
37,376 |
|
Other current assets |
10,107 |
|
29,249 |
|
Total current assets |
465,553 |
|
509,946 |
|
|
|
|
|
|
|
|
|
Vessels and equipment |
|
|
At cost,
less accumulated depreciation |
4,457,170 |
|
4,398,836 |
|
Advances on
newbuilding contracts and conversion costs |
225,129 |
|
288,658 |
|
Investment
in equity accounted joint ventures |
187,304 |
|
169,875 |
|
Deferred
tax asset |
24,222 |
|
28,110 |
|
Other
assets |
185,686 |
|
113,225 |
|
Goodwill |
129,145 |
|
129,145 |
|
Total assets |
5,674,209 |
|
5,637,795 |
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
Current |
|
|
Accounts
payable |
11,677 |
|
43,317 |
|
Accrued
liabilities |
200,951 |
|
187,687 |
|
Deferred
revenues |
51,811 |
|
69,668 |
|
Due to
affiliates |
72,361 |
|
108,483 |
|
Current
portion of derivative instruments |
58,333 |
|
42,515 |
|
Current
portion of long-term debt |
684,118 |
|
589,767 |
|
Other current liabilities |
7,849 |
|
9,056 |
|
Total current liabilities |
1,087,100 |
|
1,050,493 |
|
|
|
|
|
Long-term
debt |
2,425,126 |
|
2,533,961 |
|
Derivative
instruments |
97,167 |
|
167,469 |
|
Due to
affiliates |
164,195 |
|
163,037 |
|
Other long-term liabilities |
258,262 |
|
249,336 |
|
Total liabilities |
4,031,850 |
|
4,164,296 |
|
|
|
|
|
Redeemable non-controlling interest |
— |
|
(29 |
) |
|
|
|
|
Equity |
|
|
Limited
partners - common units |
1,058,848 |
|
1,004,077 |
|
Limited
partners - preferred units |
384,923 |
|
266,925 |
|
General
Partner |
16,405 |
|
15,996 |
|
Warrants |
132,225 |
|
132,225 |
|
Accumulated
other comprehensive income (loss) |
2,989 |
|
(523 |
) |
Non-controlling interests |
46,969 |
|
54,828 |
|
Total equity |
1,642,359 |
|
1,473,528 |
|
Total liabilities and total equity |
5,674,209 |
|
5,637,795 |
|
|
|
|
|
|
Teekay Offshore Partners
L.P.Consolidated Statements of Cash
Flows(in thousands of U.S. Dollars)
|
Three Months Ended |
|
March 31, 2018 |
March 31, 2017 |
|
(unaudited) |
(unaudited) |
Cash, cash equivalents
and restricted cash provided by (used for) |
|
|
OPERATING
ACTIVITIES |
|
|
Net income |
16,060 |
|
21,263 |
|
Non-cash items: |
|
|
Unrealized gain on derivative instruments |
(57,313 |
) |
(8,680 |
) |
Equity
income |
(13,998 |
) |
(4,475 |
) |
Depreciation and amortization |
94,304 |
|
74,726 |
|
Write-down of vessels |
28,496 |
|
— |
|
Deferred
income tax expense |
4,222 |
|
1,436 |
|
Amortization of in-process revenue contracts |
(3,142 |
) |
(3,143 |
) |
Unrealized foreign currency exchange loss and other |
4,237 |
|
7,190 |
|
Change in
non-cash working capital items related to operating activities |
(38,989 |
) |
10,802 |
|
Expenditures for dry docking |
(4,650 |
) |
(1,140 |
) |
Net operating cash flow |
29,227 |
|
97,979 |
|
FINANCING
ACTIVITIES |
|
|
Proceeds from long-term
debt |
156,520 |
|
94,169 |
|
Scheduled repayments of
long-term debt |
(134,846 |
) |
(161,369 |
) |
Prepayments of
long-term debt |
(40,000 |
) |
— |
|
Debt issuance
costs |
(6,264 |
) |
(1,054 |
) |
Proceeds from issuance
of preferred units |
120,000 |
|
— |
|
Proceeds from issuance
of common units |
— |
|
240 |
|
Expenses relating to
equity offerings |
(3,997 |
) |
(212 |
) |
Cash distributions paid
by the Partnership |
(9,506 |
) |
(17,137 |
) |
Cash distributions paid
by subsidiaries to non-controlling interests |
— |
|
(110 |
) |
Other |
(457 |
) |
(372 |
) |
Net financing cash flow |
81,450 |
|
(85,845 |
) |
INVESTING
ACTIVITIES |
|
|
Net payments for
vessels and equipment, including advances on newbuilding contracts
and conversion costs |
(145,801 |
) |
(55,205 |
) |
Investment in
equity-accounted joint ventures |
— |
|
(7,409 |
) |
Direct financing lease
payments received |
1,282 |
|
1,892 |
|
Acquisition of
companies from Teekay Corporation (net of cash acquired of $26.6
million) |
25,254 |
|
— |
|
Net investing cash flow |
(119,265 |
) |
(60,722 |
) |
Decrease in cash, cash
equivalents and restricted cash |
(8,588 |
) |
(48,588 |
) |
Cash, cash equivalents
and restricted cash, beginning of the period |
250,294 |
|
342,287 |
|
Cash, cash equivalents and restricted cash, end of the
period |
241,706 |
|
293,699 |
|
|
|
|
|
|
Teekay Offshore Partners L.P.Appendix A
- Reconciliation of Non-GAAP Financial
MeasuresAdjusted Net Income(in thousands
of U.S. Dollars)
|
|
|
Three Months Ended |
|
|
|
March 31, 2018 |
March 31, 2017 |
|
|
|
(unaudited) |
(unaudited) |
Net income
– GAAP basis |
16,060 |
|
21,263 |
|
Adjustments: |
|
|
|
Net loss (income) attributable to non-controlling
interests |
7,859 |
|
(2,372 |
) |
Net
income attributable to the partners and preferred
unitholders |
23,919 |
|
18,891 |
|
Add
(subtract) specific items affecting net income: |
|
|
|
Unrealized
gain on derivative instruments (1) |
(56,735 |
) |
(4,011 |
) |
|
Foreign
currency exchange loss (gain) (2) |
650 |
|
(2,981 |
) |
|
Pre-operational costs (3) |
1,188 |
|
1,632 |
|
|
Deferred
income tax expense relating to Norwegian tax structure (4) |
4,674 |
|
974 |
|
|
Legal
settlements, restructuring charges and other (5) |
18,605 |
|
652 |
|
|
Write-down
of vessels (6) |
28,496 |
|
— |
|
|
Non-controlling interests' share of items above
(7) |
(7,096 |
) |
— |
|
Total adjustments |
(10,218 |
) |
(3,734 |
) |
Adjusted net income attributable to the partners and
preferred unitholders |
13,701 |
|
15,157 |
|
(1) Reflects the
net unrealized gain due to changes in the mark-to-market value of
interest rate swaps and foreign currency forward contracts that are
not designated as hedges for accounting purposes, hedge
ineffectiveness from derivative instruments designated as hedges
for accounting purposes, the unrealized mark-to-market value of the
interest rate swaps within the Cidade de Itajai FPSO equity
accounted joint venture and hedge ineffectiveness within the
Pioneiro de Libra FPSO equity accounted joint venture. |
(2) Foreign
currency exchange loss (gain) primarily relates to the
Partnership’s revaluation of all foreign currency-denominated
monetary assets and liabilities based on the prevailing exchange
rate at the end of each reporting period and the unrealized gain or
loss related to the Partnership’s cross currency swaps related to
the Partnership's NOK bonds and excludes the realized gain or loss
relating to the Partnership's cross currency swaps. |
(3) Reflects
depreciation and amortization expense, general and administrative
expenses and vessel operating expenses relating to the Petrojarl I
FPSO unit while undergoing upgrades. |
(4) Reflects the
decrease in the deferred income tax asset for the Partnership's
Norwegian tax structures. |
(5) Other items
for the three months ended March 31, 2018 includes transaction
fees relating to the historical amendment of certain interest rate
swaps, an increase in depreciation expense as a result of the
change in the useful life and residual value estimates of certain
of the Partnership's shuttle tankers effective in the first quarter
of 2018 (see footnote (1) of the summary consolidated statements of
income included in this release for further details) and an accrual
for the settlement of one claim. Other items for the three months
ended March 31, 2017 mainly includes a restructuring charge
relating to the reorganization within the Partnership's FPSO
segment. |
(6) See footnote
(2) of the summary consolidated statements of income included in
this release for further details. |
(7) Items
affecting net income include amounts attributable to the
Partnership’s consolidated non-wholly-owned subsidiaries. Each item
affecting net income is analyzed to determine whether any of the
amounts originated from a consolidated non-wholly-owned subsidiary.
Each amount that originates from a consolidated non-wholly-owned
subsidiary is multiplied by the non-controlling interests’
percentage share in this subsidiary to arrive at the
non-controlling interests’ share of the amount. The amount
identified as “non-controlling interests’ share of items above” in
the table above is the cumulative amount of the non-controlling
interests’ proportionate share of items affecting net income listed
in the table. |
|
Teekay Offshore Partners L.P.Appendix B
- Reconciliation of Non-GAAP Financial
MeasuresDistributable Cash Flow(in
thousands of U.S. Dollars, except unit and per unit data)
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
|
2018 |
2017 |
|
|
|
(unaudited) |
(unaudited) |
|
|
|
|
|
Net income |
16,060 |
|
21,263 |
|
Add
(subtract): |
|
|
|
Depreciation and amortization |
94,304 |
|
74,726 |
|
|
Write-down
of vessels (1) |
28,496 |
|
— |
|
|
Partnership's share of equity accounted joint venture's
distributable cash flow net of estimated maintenance capital
expenditures (2) |
10,463 |
|
5,894 |
|
|
Deferred
income tax expense |
4,222 |
|
1,436 |
|
|
Amortization of non-cash portion of revenue contracts |
(4,374 |
) |
(3,953 |
) |
|
Distributions on preferred units |
(7,370 |
) |
(12,386 |
) |
|
Equity
income |
(13,998 |
) |
(4,475 |
) |
|
Estimated
maintenance capital expenditures (3) |
(42,624 |
) |
(41,124 |
) |
|
Unrealized
gain on non-designated derivative instruments (4) |
(50,975 |
) |
(4,234 |
) |
|
Unrealized foreign exchange loss (gain) and other,
net |
9,012 |
|
(887 |
) |
Distributable cash flow before non-controlling
interests |
43,216 |
|
36,260 |
|
|
Non-controlling interests' share of DCF |
(3,857 |
) |
(5,627 |
) |
Distributable Cash Flow |
39,359 |
|
30,633 |
|
Amount attributable to the General Partner |
(31 |
) |
(336 |
) |
Limited partners' Distributable Cash Flow |
39,328 |
|
30,297 |
|
Weighted-average number of common units
outstanding |
410,101,480 |
|
148,633,906 |
|
Distributable Cash Flow per limited partner
unit |
0.10 |
|
0.20 |
|
(1) See footnote
(2) of the summary consolidated statements of income included in
this release for further details. |
(2) Estimated
maintenance capital expenditures relating to the Partnership’s
equity-accounted joint ventures were $5.5 million and $1.0 million
for the three months ended March 31, 2018 and 2017,
respectively. |
(3) Estimated
maintenance capital expenditures for the three months ended March
31, 2018 includes $7.7 million reduction relating to cash
compensation received from a shipyard in connection with the
delayed delivery of the ALP Keeper. |
(4) Derivative
instruments include interest rate swaps, cross currency swaps, and
foreign currency forward contracts. |
|
Teekay Offshore Partners L.P.Appendix C
- Supplemental Segment Information(in thousands of U.S.
Dollars)
|
Three Months Ended March 31,
2018 |
|
(unaudited) |
|
FPSO Segment |
Shuttle Tanker Segment |
FSO Segment |
UMS Segment |
Towage Segment |
Conventional Tanker Segment |
Eliminations(1) |
Total |
|
|
|
|
|
|
|
|
|
Revenues |
134,238 |
|
143,856 |
|
33,397 |
|
— |
|
7,611 |
|
5,017 |
|
(920 |
) |
323,199 |
|
Voyage expenses |
— |
|
(26,887 |
) |
(163 |
) |
(31 |
) |
(4,796 |
) |
(3,311 |
) |
182 |
|
(35,006 |
) |
Vessel operating
expenses |
(55,679 |
) |
(40,023 |
) |
(10,815 |
) |
(1,512 |
) |
(7,469 |
) |
— |
|
116 |
|
(115,382 |
) |
Time-charter hire
expenses |
— |
|
(8,602 |
) |
— |
|
— |
|
— |
|
(4,125 |
) |
— |
|
(12,727 |
) |
Depreciation and
amortization |
(34,834 |
) |
(41,362 |
) |
(11,641 |
) |
(1,653 |
) |
(4,918 |
) |
— |
|
104 |
|
(94,304 |
) |
General and
administrative |
(9,191 |
) |
(5,906 |
) |
(744 |
) |
(1,118 |
) |
(737 |
) |
(90 |
) |
— |
|
(17,786 |
) |
Write-down of vessels |
— |
|
(28,496 |
) |
— |
|
— |
|
— |
|
— |
|
— |
|
(28,496 |
) |
Income (loss) from vessel operations |
34,534 |
|
(7,420 |
) |
10,034 |
|
(4,314 |
) |
(10,309 |
) |
(2,509 |
) |
(518 |
) |
19,498 |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
2017 |
|
(unaudited) |
|
FPSO Segment |
Shuttle Tanker Segment |
FSO Segment |
UMSSegment |
Towage Segment |
Conventional Tanker Segment |
Eliminations |
Total |
|
|
|
|
|
|
|
|
|
Revenues |
112,855 |
|
136,233 |
|
11,489 |
|
827 |
|
10,898 |
|
3,836 |
|
— |
|
276,138 |
|
Voyage expenses |
— |
|
(21,278 |
) |
(325 |
) |
— |
|
(3,510 |
) |
(28 |
) |
— |
|
(25,141 |
) |
Vessel operating
(expenses) recoveries |
(35,093 |
) |
(27,429 |
) |
(5,079 |
) |
(6,485 |
) |
(4,914 |
) |
10 |
|
— |
|
(78,990 |
) |
Time-charter hire
expenses |
— |
|
(16,698 |
) |
— |
|
— |
|
(925 |
) |
(4,133 |
) |
— |
|
(21,756 |
) |
Depreciation and
amortization |
(36,502 |
) |
(30,613 |
) |
(2,552 |
) |
(1,633 |
) |
(3,426 |
) |
— |
|
— |
|
(74,726 |
) |
General and
administrative |
(7,830 |
) |
(3,143 |
) |
(501 |
) |
(1,992 |
) |
(1,061 |
) |
(90 |
) |
— |
|
(14,617 |
) |
Restructuring charge |
(450 |
) |
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(450 |
) |
Income (loss) from vessel operations |
32,980 |
|
37,072 |
|
3,032 |
|
(9,283 |
) |
(2,938 |
) |
(405 |
) |
— |
|
60,458 |
|
(1) Includes
revenues and expenses earned and incurred between segments of
Teekay Offshore during the three months ended March 31,
2018. |
|
Teekay Offshore Partners L.P.Appendix D
- Reconciliation of Non-GAAP Financial
MeasuresCash Flow From (Used For) Vessel
Operations From Consolidated Vessels(in thousands of U.S.
Dollars)
|
|
Three Months Ended |
|
|
March 31, 2018 |
|
|
(unaudited) |
|
|
|
Shuttle |
|
|
|
Conventional |
|
|
|
FPSO |
Tanker |
FSO |
UMS |
Towage |
Tanker |
|
|
|
Segment |
Segment |
Segment |
Segment |
Segment |
Segment |
Eliminations(1) |
Total |
Income
(loss) from vessel operations |
|
|
|
|
|
|
|
|
|
(See Appendix C) |
34,534 |
|
(7,420 |
) |
10,034 |
|
(4,314 |
) |
(10,309 |
) |
(2,509 |
) |
(518 |
) |
19,498 |
|
Depreciation and amortization |
34,834 |
|
41,362 |
|
11,641 |
|
1,653 |
|
4,918 |
|
— |
|
(104 |
) |
94,304 |
|
Realized
gain from the |
|
|
|
|
|
|
|
|
|
settlements of
non-designated |
|
|
|
|
|
|
|
|
|
foreign currency
forward contracts |
180 |
|
162 |
|
— |
|
— |
|
89 |
|
— |
|
— |
|
431 |
|
Amortization of non-cash portion of |
|
|
|
|
|
|
|
|
|
revenue contracts |
(4,374 |
) |
— |
|
— |
|
— |
|
— |
|
— |
|
|
(4,374 |
) |
Write-down
of vessels |
— |
|
28,496 |
|
— |
|
— |
|
— |
|
— |
|
— |
|
28,496 |
|
Falcon
Spirit revenue accounted for |
|
|
|
|
|
|
|
|
|
as a direct financing
lease |
— |
|
— |
|
(325 |
) |
— |
|
— |
|
— |
|
— |
|
(325 |
) |
Falcon
Spirit cash flow from |
|
|
|
|
|
|
|
|
|
time-charter
contracts |
— |
|
— |
|
1,579 |
|
— |
|
— |
|
— |
|
— |
|
1,579 |
|
Eliminations upon consolidation |
— |
|
— |
|
— |
|
— |
|
(622 |
) |
— |
|
622 |
|
— |
|
Cash flow from (used for) vessel |
|
|
|
|
|
|
|
|
|
operations from consolidated vessels |
65,174 |
|
62,600 |
|
22,929 |
|
(2,661 |
) |
(5,924 |
) |
(2,509 |
) |
— |
|
139,609 |
|
|
|
Three Months Ended |
|
|
March 31, 2017 |
|
|
(unaudited) |
|
|
|
Shuttle |
|
|
|
Conventional |
|
|
|
FPSO |
Tanker |
FSO |
UMS |
Towage |
Tanker |
|
|
|
Segment |
Segment |
Segment |
Segment |
Segment |
Segment |
Eliminations |
Total |
Income
(loss) from vessel operations |
|
|
|
|
|
|
|
|
|
(See Appendix C) |
32,980 |
|
37,072 |
|
3,032 |
|
(9,283 |
) |
(2,938 |
) |
(405 |
) |
— |
|
60,458 |
|
Depreciation and amortization |
36,502 |
|
30,613 |
|
2,552 |
|
1,633 |
|
3,426 |
|
— |
|
— |
|
74,726 |
|
Realized
(loss) gain from the |
|
|
|
|
|
|
|
|
|
settlements of
non-designated |
|
|
|
|
|
|
|
|
|
foreign currency
forward contracts |
(85 |
) |
33 |
|
— |
|
— |
|
(48 |
) |
— |
|
— |
|
(100 |
) |
Amortization of non-cash portion of |
|
|
|
|
|
|
|
|
|
revenue contracts |
(3,953 |
) |
— |
|
— |
|
— |
|
— |
|
— |
|
— |
|
(3,953 |
) |
Falcon
Spirit revenue accounted for |
|
|
|
|
|
|
|
|
|
as a direct financing
lease |
— |
|
— |
|
(493 |
) |
— |
|
— |
|
— |
|
— |
|
(493 |
) |
Falcon
Spirit cash flow from |
|
|
|
|
|
|
|
|
|
time-charter contracts |
— |
|
— |
|
2,281 |
|
— |
|
— |
|
— |
|
— |
|
2,281 |
|
Cash flow from (used for) vessel |
|
|
|
|
|
|
|
|
|
operations from consolidated vessels |
65,444 |
|
67,718 |
|
7,372 |
|
(7,650 |
) |
440 |
|
(405 |
) |
— |
|
132,919 |
|
(1) Includes
revenues and expenses earned and incurred between segments of
Teekay Offshore during the three months ended March 31,
2018. |
|
Teekay Offshore Partners L.P.Appendix E
- Reconciliation of Non-GAAP Financial
MeasuresCash Flow From Vessel Operations From
Equity-Accounted Vessels(in thousands of U.S. Dollars)
|
|
Three Months Ended |
Three Months Ended |
|
|
March 31, 2018 |
March 31, 2017 |
|
(unaudited) |
(unaudited) |
|
|
At 100% |
Partnership's 50% |
At 100% |
Partnership's 50% |
Revenues |
59,657 |
|
29,829 |
|
23,792 |
|
11,896 |
|
Vessel and
other operating expenses |
(15,800 |
) |
(7,900 |
) |
(7,052 |
) |
(3,526 |
) |
Depreciation and amortization |
(14,726 |
) |
(7,363 |
) |
(4,405 |
) |
(2,203 |
) |
Income from
vessel operations of equity-accounted vessels |
29,131 |
|
14,566 |
|
12,335 |
|
6,167 |
|
Net
interest expense (1) |
(1,519 |
) |
(760 |
) |
(1,924 |
) |
(962 |
) |
Realized
and unrealized gain (loss) on derivative instruments (2) |
1,368 |
|
684 |
|
(1,231 |
) |
(616 |
) |
Foreign currency exchange (loss) gain |
(656 |
) |
(328 |
) |
53 |
|
27 |
|
Total other
items |
(807 |
) |
(404 |
) |
(3,102 |
) |
(1,551 |
) |
Net income
/ equity income of equity-accounted vessels before income tax
expense |
28,324 |
|
14,162 |
|
9,233 |
|
4,616 |
|
Income tax expense |
(327 |
) |
(164 |
) |
(282 |
) |
(141 |
) |
Net income
/ equity income of equity-accounted vessels |
27,997 |
|
13,998 |
|
8,951 |
|
4,475 |
|
Income from
vessel operations of equity-accounted vessels |
29,131 |
|
14,566 |
|
12,335 |
|
6,167 |
|
Depreciation and amortization |
14,726 |
|
7,363 |
|
4,405 |
|
2,203 |
|
Cash flow from vessel operations from equity-accounted
vessels |
43,857 |
|
21,929 |
|
16,740 |
|
8,370 |
|
|
|
|
|
|
|
|
|
|
(1) Net interest
expense for the three months ended March 31, 2018 includes an
unrealized gain of $9.7 million ($4.9 million at the Partnership's
50% share) and a realized loss of $1.1 million ($0.6 million at the
Partnership's 50% share) related to interest rate swaps designated
and qualifying as cash flow hedges for the Pioneiro de Libra FPSO
unit. |
(2) Realized and
unrealized gain (loss) on derivative instruments for the three
months ended March 31, 2018 and 2017 includes an unrealized gain of
$1.8 million ($0.9 million at the Partnership’s 50% share) and an
unrealized loss of $0.6 million ($0.3 million at the Partnership’s
50% share), respectively, related to interest rate swaps for the
Cidade de Itajai FPSO unit. |
|
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: the estimated
future cash flow from vessel operations, including the impact on
the Partnership's balance sheet, from the Partnership’s
existing near-term growth projects; the potential contract
extension for the Voyageur Spirit FPSO; the expected demand for
offshore production, storage and transportation services; the
expected cash flow from vessel operations relating to the
employment of the Petrojarl I FPSO unit on the Atlanta field; the
expected duration of the mobilization and field installation
services to be performed by the ALP Maritime vessels for the Kaombo
Norte FPSO; the possibility of liquidated damages relating to
project delays associated with Petrojarl I FPSO unit; the potential
for an oil/production tariff on the Petrojarl I and Voyageur Sprit
FPSOs; a potential global energy and offshore market recovery; the
extension of the Arendal Spirit UMS loan facility; and the
Partnership’s ability to benefit from future opportunities. 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 exploration, production
and storage of offshore oil and gas, either generally or in
particular regions that would impact expected future growth,
particularly in or related to North Sea, Brazil and East Coast of
Canada offshore fields; significant changes in oil prices;
variations in expected levels of field maintenance; increased
operating expenses; potential early termination of contracts;
shipyard delivery delays and cost overruns; delays in the
commencement of charter contracts; the inability of charterers to
make future charter payments; the inability of the Partnership to
renew or replace long-term contracts on existing vessels; the
ability to fund the Partnership’s remaining capital commitments and
debt maturities; and other factors discussed in Teekay Offshore’s
filings from time to time with the SEC, including its Report on
Form 20-F for the fiscal year ended December 31, 2017. The
Partnership 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
Partnership’s expectations with respect thereto or any change in
events, conditions or circumstances on which any such statement is
based.
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