Highlights
-- Generated distributable cash flow(1)of $55.4 million in the second
quarter of 2013.
-- Declared second quarter 2013 cash distribution of $0.675 per unit.
-- In June 2013, secured five-year time-charter contracts with Cheniere for
the two LNG carrier newbuildings ordered in December 2012.
-- In July 2013, exercised options with DSME for two additional MEGI LNG
carrier newbuildings and secured five additional newbuilding options.
-- In August 2013, agreed to acquire and bareboat charter-back up to two
newbuilding LNG carriers, with Awilco LNG ASA.
-- Total liquidity of $300 million as at June 30, 2013, giving pro forma
effect to proceeds from the $40 million common unit private placement
completed on July 30, 2013.
Teekay GP L.L.C., the general partner of Teekay LNG Partners
L.P. (Teekay LNG or the Partnership) (NYSE:TGP), today reported the
Partnership's results for the quarter ended June 30, 2013. During
the second quarter of 2013, the Partnership generated distributable
cash flow(1) of $55.4 million, compared to $56.8 million in the
same quarter of the previous year. The decrease in distributable
cash flow was primarily the result of a higher number of off - hire
days in the second quarter of 2013, compared to the same period in
2012, due to scheduled dry dockings, and lower charter rates on two
of the Partnership's conventional tankers as a result of
renegotiated rates effective October 2012 for a period of two
years. The decreases were partially offset by increased
distributable cash flow as a result of the Partner ship's
acquisition of a 50 percent interest in Exmar LPG BVBA, a liquefied
petroleum gas (LPG) carrier joint venture with Exmar, in February
2013 and higher rates on charter contracts entered into during 2012
for certain of the MALT LNG Carriers.
On July 12, 2013, the Partnership declared a cash distribution
of $0.675 per unit for the quarter ended June 30, 2013. The cash
distribution is payable on August 9, 2013 to all unitholders of
record on July 23, 2013.
(1) Distributable cash flow is a non-GAAP financial measure used
by certain investors to measure the financial performance of the
Partnership and other master limited partnerships. Please see
Appendix B for a reconciliation of this non-GAAP measure to the
most directly comparable financial measure under United States
generally accepted accounting principles (GAAP).
Recent Transactions
Secured Fixed-Rate Employment for the Two LNG Carrier
Newbuildings Ordered in December 2012
In June 2013, Teekay LNG was awarded five-year time-charter
contracts with Cheniere Marketing LLC (Cheniere) for the two
173,400 cubic meter (cbm) liquefied natural gas (LNG) carrier
newbuildings the Partnership ordered in December 2012. The
newbuilding LNG carriers are currently under construction by Daewoo
Shipbuilding & Marine Engineering Co., Ltd., (DSME) of South
Korea and are scheduled to deliver in the first half of 2016. Upon
delivery, the vessels will commence their five-year charters with
Cheniere, which will be exporting LNG from their Sabine Pass LNG
export facility in Louisiana . These newbuilding vessels will be
equipped with the M-type, Electronically Controlled, Gas Injection
(MEGI) twin engines, which are expected to be significantly more
fuel-efficient and have lower emission levels than other engines
currently being utilized in LNG shipping.
Exercised Options for Additional Newbuilding LNG/LPG
Carriers
In July 2013, Teekay LNG exercised a portion of its existing
options with DSME for two additional 173,400 cbm LNG carrier
newbuildings, which will also be constructed with the MEGI twin
engines. The Partnership intends to secure long- term contract
employment for both vessels prior to their deliveries in 2016. In
connection with the exercise of these two newbuilding options, the
Partnership secured additional options with DSME for up to five
additional LNG carrier newbuildings.
In addition, Exmar LPG BVBA, the Partnership's 50/50 LPG joint
venture with Belgium-based Exmar NV, exercised its options to order
two additional Midsize Gas Carrier (MGC) newbuildings, which will
be constructed by Hanjin Heavy Industries and Construction Co.,
Ltd. (Hanjin) and scheduled for delivery in 2017.
Acquisition and Bareboat Charter Back of up to Two LNG Carrier
Newbuildings
In August 2013, Teekay LNG agreed to acquire a 155,900 cbm LNG
carrier newbuilding from Norway -based Awilco LNG ASA (Awilco),
which is currently under construction by DSME in South Korea. The
vessel is expected to deliver in September 2013, at which time
Awilco will sell the vessel to Teekay LNG and bareboat charter the
vessel back on a five -year fixed-rate charter contract (plus a
one-year extension option) with a fixed-price purchase obligation
at the end of the initial term (and option period). The net vessel
purchase price of $155 million reflects a $50 million prepayment by
Awilco for future charter hire installments. As part of the
transaction, Teekay LNG may also have the opportunity to acquire
and bareboat charter back a second 155,900 cbm LNG carrier
newbuilding from Awilco, currently under construction by DSME,
under similar terms. The second LNG carrier newbuilding is expected
to deliver in late-2013 or early-2014.
"Since reporting first quarter results in May, the Partnership's
business development activities have resulted in several positive
outcomes," commented Peter Evensen, Chief Executive Officer of
Teekay GP LLC. "This includes securing new time-charter contracts
and newbuilding vessel orders, and acquiring on-the-water vessels
with existing contracts, all of which are expected to result in
near and long-term distributable cash flow growth. To begin with,
in June, we were awarded five-year time-charters with Cheniere for
the two LNG carrier newbuildings we ordered in December 2012. These
vessels' attractive 173,400 cubic meter cargo size and
fuel-efficient MEGI engines were key factors in being awarded these
important new contracts. These vessels will be among the first to
export LNG from the Sabine Pass facility in the U.S. Gulf
Coast."
Mr. Evensen continued, "Based on our successful chartering
efforts for the first two MEGI newbuildings, in late -July, the
Partnership exercised a portion of its options with DSME to order
an additional two 173,400 cubic meter MEGI LNG carrier
newbuildings. As with the two carriers we ordered in December, we
believe the 2016 delivery dates for these vessels will be
well-timed for the next major wave of LNG carrier demand which is
expected to follow the large number of LNG export projects that are
scheduled to come on-stream starting in late-2015. While we expect
to secure long-term financing for these vessels upon securing
time-charter employment, we will fund the initial shipyard
installments with a portion of the proceeds from the Partnership's
recent $40 million common unit private placement transaction. As
part of this vessel order, the Partnership also secured five
additional options from DSME for future LNG carrier orders."
"Our position in the attractive liquefied petroleum gas sector
also continues to grow," Mr. Evensen added. "Last week, our LPG
joint venture with Exmar exercised in-the-money options with Hanjin
to construct two additional medium-size gas carrier, or MGC,
newbuildings, bringing the joint venture's MGC newbuilding program
to a total of 10 vessels."
"Looking more near-term," Mr. Evensen continued, "last week, the
Partnership announced an agreement to acquire up to two 155,900
cubic meter LNG carrier newbuildings from Awilco LNG, with a
five-year fixed-rate bareboat charter back to Awilco at a net price
of $155 million per vessel. Assuming the option for the second
vessel is exercised, these two vessels, which are scheduled to
deliver from DSME in September and November 2013, are expected to
provide the Partnership with near-term cash flow accretion and
bridge the gap between now and when our other newbuilding vessels
begin delivering in 2016."
Mr. Evensen added, "In addition to our recent announcements, the
Partnership is currently involved in several LNG shipping and
floating regasification project tenders with start-up dates in the
late-2015 through 2017 that would generate further accretive
distributable cash flows for the Partnership."
Financial Summary
The Partnership reported adjusted net income attributable to the
partners(2) (as detailed in Appendix A to this release) of $41.5
million for the quarter ended June 30, 2013, compared to $40.5
million for the same period of the prior year. Adjusted net income
attributable to the partners excludes a number of specific items
that had the net effect of increasing net income by $28.1 million
and decreasing net income by $2.8 million for the three months
ended June 30, 2013 and 2012, respectively, as detailed in Appendix
A. Including these items, the Partnership reported net income
attributable to the partners, on a GAAP basis, of $69.7 million and
$37.7 million for the three months ended June 30, 2013 and 2012,
respectively.
For the six months ended June 30, 2013, the Partnership reported
adjusted net income attributable to the partners (2) (as detailed
in Appendix A to this release) of $80.6 million, compared to $76.1
million for the same period of the prior year. Adjusted net income
attributable to the partners excludes a number of specific items
that had the net effect of increasing net income by $43.5 million
and decreasing net income by $13.7 million for the six months ended
June 30, 2013 and 2012, respectively, as detailed in Appendix A.
Including these items, the Partnership reported net income
attributable to the partners, on a GAAP basis, of $124.1 million
and $62.4 million for the six months ended June 30, 2013 and 2012,
respectively.
For accounting purposes, the Partnership is required to
recognize the changes in the fair value of its derivative
instruments on its consolidated statements of income. This method
of accounting does not affect the Partnership's cash flows or the
calculation of distributable cash flow, but results in the
recognition of unrealized gains or losses on the consolidated
statements of income as detailed in notes 2, 3 and 4 to the Summary
Consolidated Statements of Income included in this release.
(2) Adjusted net income attributable to the partners is a
non-GAAP financial measure. Please refer to Appendix A to this
release for a reconciliation of this non-GAAP measure to the most
directly comparable financial measure under GAAP and information
about specific items affecting net income which are typically
excluded by securities analysts in their published estimates of the
Partnership's financial results.
Operating Results
The following table highlights certain financial information for
Teekay LNG's two segments: the Liquefied Gas segment and the
Conventional Tanker segment (please refer to the "Teekay LNG's
Fleet" section of this release below and Appendices C to F for
further details).
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended
June 30, 2013
(unaudited)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Liquefied Gas Conventional
(in thousands of U.S. Dollars) Segment Tanker Segment Total
Net voyage revenues(i) 67,863 27,532 95,395
Vessel operating expenses 13,683 11,131 24,814
Depreciation and amortization 18,329 6,827 25,156
----------------------------------------------------------------------------
----------------------------------------------------------------------------
CFVO from consolidated
vessels(ii) 52,581 12,892 65,473
CFVO from equity accounted
vessels(iii) 47,162 - 47,162
Total CFVO(ii) 99,743 12,892 112,635
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended
June 30, 2012
(unaudited)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Liquefied Gas Conventional
(in thousands of U.S. Dollars) Segment Tanker Segment Total
Net voyage revenues(i) 67,573 28,662 96,235
Vessel operating expenses 11,774 10,403 22,177
Depreciation and amortization 17,309 7,487 24,796
----------------------------------------------------------------------------
----------------------------------------------------------------------------
CFVO from consolidated
vessels(ii) 54,259 16,740 70,999
CFVO from equity accounted
vessels(iii) 38,035 - 38,035
Total CFVO(ii) 92,294 16,740 109,034
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(i) Net voyage revenues represents voyage revenues less voyage expenses,
which comprise all expenses relating to certain voyages, including
bunker fuel expenses, port fees, canal tolls and brokerage
commissions. Net voyage revenues is a non-GAAP financial measure used
by certain investors to measure the financial performance of shipping
companies. Please see Appendix C for a reconciliation of this non-GAAP
measure as used in this release to the most directly comparable GAAP
financial measure.
(ii) Cash flow from vessel operations (CFVO) from consolidated vessels
represents income from vessel operations before (a) depreciation and
amortization expense, (b) amortization of in-process revenue contracts
and includes (c) adjustments for direct financing leases and two
Suezmax tankers to a cash basis. CFVO is included because certain
investors use this data to measure a company's financial performance.
CFVO is not required by GAAP and should not be considered as an
alternative to net income, equity income or any other indicator of the
Partnership's performance required by GAAP. Please see Appendix E for
a reconciliation of CFVO from consolidated vessels (a non-GAAP
measure) as used in this release to the most directly comparable GAAP
financial measure.
(iii) The Partnership's equity accounted investments for the three months
ended June 30, 2013 and 2012 include the Partnership's 40 percent
interest in Teekay Nakilat (III) Corporation, which owns four LNG
carriers; the Partnership's 50 percent interest in the Excalibur and
Excelsior joint ventures, which owns one LNG carrier and one
regasification unit, respectively; the Partnership's 33 percent
interest in four LNG carriers servicing the Angola LNG Project; and
the Partnership's 52 percent interest in MALT LNG Holdings ApS, the
joint venture between the Partnership and Maurbeni Corporation, which
owns six LNG carriers (Malt LNG Carriers). The Partnership's equity
accounted investments for the three months ended June 30, 2013 also
includes the Partnership's acquisition of a 50 percent interest in
Exmar LPG BVBA, the joint venture between the Partnership and Exmar
NV, completed in February 2013, which currently owns and charters-in
26 vessels in the LPG carrier segment, including ten newbuildings.
Please see Appendix F for a description and reconciliation of CFVO
from equity accounted vessels (a non-GAAP measure) as used in this
release to the most directly comparable GAAP financial measure.
Liquefied Gas Segment
Cash flow from vessel operations from the Partnership's
Liquefied Gas segment, excluding equity accounted vessels,
decreased to $52.6 million in the second quarter of 2013 from $54.3
million in the same quarter of the prior year. The decrease is
primarily due to higher vessel operating expenditures due to the
scheduled dry dockings of the first Tangguh project LNG carrier and
the Catalunya Spirit during the second quarter of 2013 and
preparations for the dry docking of the second Tangguh project LNG
carrier scheduled for the fourth quarter of 2013, partially offset
by the scheduled dry docking of the Hispania Spirit in the second
quarter of the prior year.
Cash flow from vessel operations from the Partnership's equity
accounted vessels in the Liquefied Gas segment increased to $47.2
million in the second quarter of 2013 from $38.0 million in the
same quarter of the prior year. This increase was primarily due to
the acquisition of a 50 percent interest in the Exmar LPG BVBA
joint venture in February 2013 and higher rates on charter
contracts entered into during 2012 for certain of the MALT LNG
Carriers.
Conventional Tanker Segment
Cash flow from vessel operations from the Partnership's
Conventional Tanker segment decreased to $12.9 million in the
second quarter of 2013 from $16.7 million in the same quarter of
the prior year, primarily as a result of the European Spirit being
off-hire for 25 days during the second quarter of 2013 due to a
scheduled dry docking and amendments to two of the Partnership's
Suezmax tanker charter contracts which temporarily reduced the
daily hire rate for each of these vessels by $12,000 between
October 2012 and September 2014. During this period, however, if
Suezmax spot tanker rates exceed the amended rates, the charterer
will pay the Partnership the excess amount up to a maximum amount
equal to the original daily charter rate.
Teekay LNG's Fleet
The following table summarizes the Partnership's fleet as of
August 1, 2013:
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Number of Vessels
---------------------------------------------------
---------------------------------------------------
Owned In-Chartered
Vessels Vessels Newbuildings Total
---------------------------------------------------
LNG Carrier Fleet 27(i) - 5 32
LPG/Multigas Carrier
Fleet 16(ii) 5(iii) 10(iii) 31
Conventional Tanker Fleet 11 - - 11
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Total 54 5 15 74
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(i) The Partnership's ownership interests in these vessels ranges from 33
percent to 100 percent.
(ii) The Partnership's ownership interests in these vessels ranges from 50
percent to 99 percent.
(iii) The Partnership's interest in these vessels is 50 percent.
Liquidity and Continuous Offering Program Update
In May 2013, the Partnership implemented a continuous offering
program (COP) under which the Partnership may issue new common
units, representing limited partner interests, at market prices up
to maximum aggregate amount of $100 million. Through June 30, 2013,
the Partnership sold an aggregate of 124,071 common units under the
COP, generating proceeds of approximately $4.9 million (including
the Teekay LNG general partner's 2 percent proportionate capital
contribution and net of offering costs). The net proceeds from the
issuance of these common units were used for general partnership
purposes.
As of June 30, 2013, the Partnership had total liquidity of
$262.3 million (comprised of $97.6 million in cash and cash
equivalents and $164.7 million in undrawn credit facilities).
Giving effect for the $40 million common unit private placement
completed in July 2013, the Partnership's liquidity at June 30,
2013 would have been approximately $300 million.
Conference Call
The Partnership plans to host a conference call on Friday,
August 9, 2013 at 11:00 a.m. (ET) to discuss the results for the
second quarter of 2013. All unitholders and interested parties are
invited to listen to the live conference call by choosing from the
following options:
-- By dialing (866) 322-2356 or (416) 640-3405, if outside North America,
and quoting conference ID code 9295387.
-- By accessing the webcast, which will be available on Teekay LNG's
website at www.teekaylng.com (the archive will remain on the web site
for a period of 30 days).
A supporting Second Quarter 2013 Earnings Presentation will also
be available at www.teekaylng.com in advance of the conference call
start time.
The conference call will be recorded and made available until
Friday, August 16, 2013. 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 9295387.
About Teekay LNG Partners L.P.
Teekay LNG Partners is the world's third largest independent
owner and operator of LNG carriers, providing LNG, LPG and crude
oil marine transportation services primarily under long-term,
fixed-rate charter contracts through its interests in 32 LNG
carriers (including one LNG regasification unit and five
newbuildings), 31 LPG/Multigas carriers (including five
chartered-in LPG carriers and 10 newbuildings) and 11 conventional
tankers. The Partnership's interests in these vessels range from 33
to 100 percent. Teekay LNG Partners L.P. is a publicly-traded
master limited partnership (MLP) formed by Teekay Corporation
(NYSE:TK) as part of its strategy to expand its operations in the
LNG and LPG shipping sectors.
Teekay LNG Partners' common units trade on the New York Stock
Exchange under the symbol "TGP".
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY LNG PARTNERS L.P.
SUMMARY CONSOLIDATED STATEMENTS OF INCOME
(in thousands of U.S. Dollars, except units outstanding)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended Six Months Ended
----------------------------------- ------------------------
June March 31, June 30, June 30, June 30,
30, 2013 2013 2012 2013 2012
----------- ----------- ----------- ----------- ------------
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
----------- ----------- ----------- ----------- ------------
----------------------------------------------------------------------------
VOYAGE REVENUES 96,619 97,107 96,477 193,726 195,817
----------------------------------------------------------------------------
OPERATING
EXPENSES
Voyage expenses 1,224 391 242 1,615 585
Vessel
operating
expenses(1) 24,814 25,316 22,177 50,130 44,564
Depreciation
and
amortization 25,156 24,143 24,796 49,299 49,553
General and
administrative
(1) 4,744 5,469 4,433 10,213 9,693
----------------------------------------------------------------------------
Total operating
expenses 55,938 55,319 51,648 111,257 104,395
----------------------------------------------------------------------------
Income from
vessel
operations 40,681 41,788 44,829 82,469 91,422
----------------------------------------------------------------------------
OTHER ITEMS
Equity
income(2) 39,425 26,424 11,086 65,849 28,134
Interest
expense (13,132) (13,248) (13,734) (26,380) (26,532)
Interest income 782 515 949 1,297 1,881
Realized and
unrealized
gain (loss) on
derivative
instruments(3) 10,666 (8,285) (18,145) 2,381 (34,048)
Foreign
exchange
(loss) gain(4) (2,787) 8,211 13,927 5,424 4,259
Other income -
net 407 469 480 876 694
----------------------------------------------------------------------------
35,361 14,086 (5,437) 49,447 (25,612)
----------------------------------------------------------------------------
Net income
before tax
(expense)
recovery 76,042 55,874 39,392 131,916 65,810
Income tax
(expense)
recovery (800) (843) (132) (1,643) 129
----------------------------------------------------------------------------
Net income 75,242 55,031 39,260 130,273 65,939
----------------------------------------------------------------------------
Non-controlling
interest in
net income 5,581 586 1,572 6,167 3,520
General
Partner's
interest in
net income 6,278 5,965 5,293 12,243 10,325
Limited
partners'
interest in
net income 63,383 48,480 32,395 111,863 52,094
Weighted-
average number
of common
units
outstanding:
- Basic 69,713,500 69,683,763 64,857,900 69,698,714 64,857,900
- Diluted 69,732,097 69,686,503 64,857,900 69,709,382 64,857,900
Total number of
units
outstanding at
end of period 69,813,899 69,683,763 64,857,900 69,813,899 64,857,900
----------------------------------------------------------------------------
(1) To more closely align the Partnership's Statement of Income presentation
to many of its peers, the cost of ship management services of $1.9 million
and $3.8 million for the three and six months ended June 30, 2013,
respectively, and $1.9 million for the three months ended March 31, 2013,
have been included as vessel operating expenses. Prior to 2013, the
Partnership 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 $2.0 million and $3.9 million for the three and six months ended June
30, 2012, respectively.
(2) Equity income includes unrealized gains (losses) on derivative
instruments as detailed in the table below:
Three Months Ended Six Months Ended
June 30, March 31, June 30, June 30, June 30,
2013 2013 2012 2013 2012
-------------------------------------------------
Equity income 39,425 26,424 11,086 65,849 28,134
Proportionate share of
unrealized gains (losses)
on derivative instruments 14,135 4,599 (8,242) 18,734 (3,181)
-------------------------------------------------
Equity income excluding
unrealized gains (losses)
on derivative instruments 25,290 21,825 19,328 47,115 31,315
-------------------------------------------------
Equity income also includes the Partnership's share of its joint venture
Exmar LPG BVBA which is based on preliminary purchase price allocations.
(3) The realized (losses) gains relate to the amounts the Partnership
actually paid to settle derivative instruments and the unrealized gains
(losses) relate to the change in fair value of such derivative instruments
as detailed in the table below:
Three Months Ended Six Months Ended
June 30, March 31, June 30, June 30, June 30,
2013 2013 2012 2013 2012
-----------------------------------------------
Realized losses relating to:
Interest rate swaps (9,496) (9,526) (9,284) (19,022) (18,363)
Toledo Spirit time-charter
derivative contract (23) - (6) (23) (38)
-----------------------------------------------
(9,519) (9,526) (9,290) (19,045) (18,401)
-----------------------------------------------
Unrealized gains (losses)
relating to:
Interest rate swaps 19,885 (1,259) (8,855) 18,626 (15,947)
Toledo Spirit time-charter
derivative contract 300 2,500 - 2,800 300
-----------------------------------------------
20,185 1,241 (8,855) 21,426 (15,647)
-----------------------------------------------
Total realized and
unrealized gains (losses)
on derivative instruments 10,666 (8,285) (18,145) 2,381 (34,048)
-----------------------------------------------
-----------------------------------------------
(4) For accounting purposes, the Partnership is required to
revalue all foreign currency-denominated monetary assets and
liabilities based on the prevailing exchange rate at the end of
each reporting period. This revaluation does not affect the
Partnership's cash flows or the calculation of distributable cash
flow, but results in the recognition of unrealized foreign currency
translation gains or losses in the consolidated statements of
income.
Foreign exchange (loss) gain includes realized gains relating to
the amounts the Partnership received to settle the Partnership's
non-designated cross currency swap that was entered into as an
economic hedge in relation to the Partnership's Norwegian Kroner
(NOK)-denominated unsecured bonds. The Partnership issued NOK 700
million of unsecured bonds in May 2012 that mature in 2017. Foreign
exchange (loss) gain also includes unrealized (losses) gains
relating to the change in fair value of such derivative
instruments, partially offset by unrealized gains on the
revaluation of the NOK bonds as detailed in the table below:
Three Months Ended Six Months Ended
June 30, March 31, June 30, June 30, June 30,
2013 2013 2012 2013 2012
----------------------------------------------
Realized (losses) gains on
cross-currency swaps (67) 58 48 (9) 48
Unrealized losses on cross-
currency swaps (2,731) (6,191) (10,270) (8,922) (10,270)
Unrealized gains on
revaluation of NOK bonds 4,545 5,923 7,560 10,468 7,560
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY LNG PARTNERS L.P.
SUMMARY CONSOLIDATED BALANCE SHEETS
(in thousands of U.S. Dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
As at
As at June 30, As at March 31, December 31,
-------------- --------------- -------------
2013 2013 2012
-------------- --------------- -------------
(unaudited) (unaudited) (unaudited)
-------------- --------------- -------------
ASSETS
Current
Cash and cash equivalents 97,621 90,982 113,577
Restricted cash - current 33,096 34,166 34,160
Accounts receivable 14,404 13,755 13,408
Prepaid expenses 8,141 7,714 5,836
Current portion of derivative
assets 18,306 18,378 17,212
Current portion of net
investments in direct 6,928 6,790 6,656
financing leases
Advances to affiliates 3,421 3,273 13,864
----------------------------------------------------------------------------
Total current assets 181,917 175,058 204,713
----------------------------------------------------------------------------
Restricted cash - long-term 495,084 494,353 494,429
Vessels and equipment
At cost, less accumulated
depreciation 1,275,120 1,283,135 1,286,957
Vessels under capital leases,
at cost, less accumulated 612,633 618,238 624,059
depreciation
Advances on newbuilding
contracts 39,097 38,829 38,624
----------------------------------------------------------------------------
Total vessels and equipment 1,926,850 1,940,202 1,949,640
----------------------------------------------------------------------------
Investment in and advances to
equity accounted joint 627,477 589,507 409,735
ventures(1)
Net investments in direct
financing leases 393,225 395,005 396,730
Advances to joint venture
partner 14,004 14,004 14,004
Other assets 26,573 25,840 25,233
Derivative assets 89,685 125,874 145,347
Intangible assets - net 103,064 106,524 109,984
Goodwill - liquefied gas
segment 35,631 35,631 35,631
----------------------------------------------------------------------------
Total assets 3,893,510 3,901,998 3,785,446
----------------------------------------------------------------------------
----------------------------------------------------------------------------
LIABILITIES AND EQUITY
Current
Accounts payable 3,925 3,482 2,178
Accrued liabilities 41,300 39,809 38,134
Unearned revenue 8,645 8,401 19,417
Current portion of long-term
debt 87,079 86,460 86,489
Current obligations under
capital lease 160,284 162,897 70,272
Current portion of derivative
liabilities 69,903 49,920 48,046
Advances from affiliates 17,739 16,551 12,083
----------------------------------------------------------------------------
Total current liabilities 388,875 367,520 276,619
----------------------------------------------------------------------------
Long-term debt 1,477,856 1,461,207 1,326,864
Long-term obligations under
capital lease 472,440 472,260 567,302
Long-term unearned revenue 37,244 37,627 38,570
Other long-term liabilities 73,455 73,644 73,568
Derivative liabilities 159,320 233,018 248,249
----------------------------------------------------------------------------
Total liabilities 2,609,190 2,645,276 2,531,172
----------------------------------------------------------------------------
Equity
Non-controlling interest(2) 47,317 41,736 41,294
Partners' equity 1,237,003 1,214,986 1,212,980
----------------------------------------------------------------------------
Total equity 1,284,320 1,256,722 1,254,274
----------------------------------------------------------------------------
Total liabilities and total
equity 3,893,510 3,901,998 3,785,446
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Investments in and advances to equity accounted joint ventures includes
the Partnership's investment in its joint venture Exmar LPG BVBA which
is based on preliminary purchase price adjustments.
(2) Non-controlling interest includes a 30 percent equity interest in the
RasGas II project (which owns three LNG carriers), a 31 percent equity
interest in the Tangguh Project (which owns two LNG carriers), a 1
percent equity interest in the two LNG carriers (Arctic Spirit and
Polar Spirit), a 1 percent equity interest in the Excalibur joint
venture (which owns one LNG carrier), and a 1 percent equity interest
in the five LPG/Multigas carriers that are chartered out to I.M.
Skaugen ASA, which in each case represents the ownership interest not
owned by the Partnership.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY LNG PARTNERS L.P.
SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of U.S. Dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Six Six
Months Months
Ended Ended
June 30, June 30,
2013 2012
$ $
---------------------------
Cash and cash equivalents provided by (used for)
OPERATING ACTIVITIES
Net income 130,273 65,939
Non-cash items:
Unrealized (gain) loss on derivative
instruments (21,426) 15,647
Depreciation and amortization 49,299 49,553
Unrealized foreign currency exchange gain (5,993) (4,670)
Equity income (65,849) (28,134)
Amortization of deferred debt issuance costs
and other 1,494 18
Change in operating assets and liabilities 5,748 (6,609)
Expenditures for dry docking (17,796) (2,972)
----------------------------------------------------------------------------
Net operating cash flow 75,750 88,772
----------------------------------------------------------------------------
FINANCING ACTIVITIES
Proceeds from issuance of long-term debt 219,748 395,352
Scheduled repayments of long-term debt (42,999) (42,200)
Prepayments of long-term debt (10,000) (119,274)
Debt issuance costs - (1,808)
Scheduled repayments of capital lease obligations
and other long-term liabilities (5,205) (5,040)
Proceeds from units issued out of continuous
offering program, net of offering costs 4,924 -
Advances to joint venture partners and equity
accounted joint ventures (16,785) (3,600)
Increase in restricted cash (952) (30,511)
Cash distributions paid (105,943) (93,636)
Other (144) (50)
----------------------------------------------------------------------------
Net financing cash flow 42,644 99,233
----------------------------------------------------------------------------
INVESTING ACTIVITIES
Purchase of equity accounted investments (135,790) (170,067)
Receipts from direct financing leases 3,233 2,992
Expenditures for vessels and equipment (1,793) (1,010)
Other - 1,369
----------------------------------------------------------------------------
Net investing cash flow (134,350) (166,716)
----------------------------------------------------------------------------
(Decrease) increase in cash and cash equivalents (15,956) 21,289
Cash and cash equivalents, beginning of the
period 113,577 93,627
----------------------------------------------------------------------------
Cash and cash equivalents, end of the period 97,621 114,916
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY LNG PARTNERS L.P.
APPENDIX A - SPECIFIC ITEMS AFFECTING NET INCOME
(in thousands of U.S. Dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Set forth below is a reconciliation of the Partnership's unaudited adjusted
net income attributable to the partners, a non- GAAP financial measure, to
net income attributable to the partners as determined in accordance with
GAAP. The Partnership believes that, in addition to conventional measures
prepared in accordance with GAAP, certain investors use this information to
evaluate the Partnership's financial performance. The items below are also
typically excluded by securities analysts in their published estimates of
the Partnership's financial results. Adjusted net income attributable to the
partners 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 Six Months Ended
----------------------- -----------------------
June 30, June 30, June 30, June 30,
----------- ----------- ----------- -----------
2013 2012 2013 2012
----------- ----------- ----------- -----------
(unaudited) (unaudited) (unaudited) (unaudited)
----------------------------------------------------------------------------
Net income - GAAP basis 75,242 39,260 130,273 65,939
Less:
Net income attributable to
non-controlling interest (5,581) (1,572) (6,167) (3,520)
----------------------------------------------------------------------------
Net income attributable to
the partners 69,661 37,688 124,106 62,419
Add (subtract) specific items
affecting net income:
Unrealized foreign currency
exchange losses (gains)(1) 2,960 (13,879) (5,088) (4,211)
Unrealized (gains) losses
from derivative
instruments(2) (20,185) 8,855 (21,426) 15,647
Unrealized (gains) losses
from derivative
instruments and other
items from equity
accounted investees(3) (14,135) 8,800 (18,734) 3,989
Non-controlling interests'
share of items above(4) 3,219 (935) 1,713 (1,712)
----------------------------------------------------------------------------
Total adjustments (28,141) 2,841 (43,535) 13,713
----------------------------------------------------------------------------
Adjusted net income
attributable to the partners 41,520 40,529 80,571 76,132
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Unrealized foreign exchange losses (gains) primarily relate 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 unrealized loss on the cross-currency swap
economically hedging the Partnership's NOK bond and exclude the
realized gains relating to the cross currency swap for the NOK bonds.
(2) Reflects the unrealized (gains) losses due to changes in the mark-to-
market value of derivative instruments that are not designated as
hedges for accounting purposes.
(3) Reflects the unrealized (gains) losses due to changes in the mark-to-
market value of derivative instruments that are not designated as
hedges for accounting purposes within the Partnership's equity-
accounted investments and $0.6 million and $0.8 million of start-up
related costs during the three and six months ended June 30, 2012,
respectively, relating to the acquisition of the MALT LNG Carriers in
February 2012.
(4) Items affecting net income include items from the Partnership's wholly-
owned subsidiaries, its consolidated non-wholly-owned subsidiaries and
its proportionate share of items from equity accounted for investments.
The specific items affecting net income are 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 listed above" in the table above
is the cumulative amount of the non- controlling interests'
proportionate share of items listed in the table.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY LNG PARTNERS L.P.
APPENDIX B - RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
DISTRIBUTABLE CASH FLOW (DCF)
(in thousands of U.S. Dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Description of Non-GAAP Financial Measure - Distributable Cash Flow (DCF)
Distributable cash flow represents net income adjusted for depreciation and
amortization expense, non-cash items, estimated maintenance capital
expenditures, unrealized gains and losses from derivatives, deferred income
taxes and foreign exchange related items. 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. Distributable cash flow is a quantitative standard used in
the publicly-traded partnership investment community to assist in evaluating
a partnership's ability to make quarterly cash distributions. Distributable
cash flow is not required by GAAP and should not be considered as an
alternative to net income or any other indicator of the Partnership's
performance required by GAAP. The table below reconciles distributable cash
flow to net income.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Three Months
Ended Ended
-----------------------------
June 30, 2013 June 30, 2012
-----------------------------
(unaudited) (unaudited)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Net income: 75,242 39,260
Add:
Depreciation and amortization 25,156 24,673
Partnership's share of equity accounted joint
ventures' DCF before estimated maintenance
and capital expenditures 34,816 27,389
Unrealized foreign exchange loss (gain) 2,960 (13,879)
Less:
Estimated maintenance capital expenditures (17,985) (14,190)
Equity income (39,425) (11,086)
Unrealized (gain) loss on derivatives and
other non-cash items (21,281) 8,757
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Distributable Cash Flow before Non-controlling
interest 59,483 60,924
Non-controlling interests' share of DCF before
estimated maintenance capital expenditures (4,083) (4,170)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Distributable Cash Flow 55,400 56,754
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY LNG PARTNERS L.P.
APPENDIX C - RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
NET VOYAGE REVENUES
(in thousands of U.S. Dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Description of Non-GAAP Financial Measure - Net Voyage Revenues
Net voyage revenues represents voyage revenues less voyage expenses, which
comprise all expenses relating to certain voyages, including bunker fuel
expenses, port fees, canal tolls and brokerage commissions. Net voyage
revenues is included because certain investors use this data to measure the
financial performance of shipping companies. Net voyage revenues is not
required by GAAP and should not be considered as an alternative to voyage
revenues or any other indicator of the Partnership's performance required by
GAAP.
Three Months Ended June 30, 2013
-----------------------------------
(unaudited)
-----------------------------------
Liquefied Gas Conventional
Segment Tanker Segment Total
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Voyage revenues 68,270 28,349 96,619
Voyage expenses 407 817 1,224
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Net voyage revenues 67,863 27,532 95,395
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended June 30, 2012
-----------------------------------
(unaudited)
-----------------------------------
Liquefied Gas Conventional
Segment Tanker Segment Total
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Voyage revenues 67,603 28,874 96,477
Voyage expenses 30 212 242
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Net voyage revenues 67,573 28,662 96,235
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY LNG PARTNERS L.P.
APPENDIX D - SUPPLEMENTAL SEGMENT INFORMATION
(in thousands of U.S. Dollars)
Three Months Ended June 30, 2013
-------------------------------------------
(unaudited)
Liquefied Gas Conventional
Segment Tanker Segment Total
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Net voyage revenues(1) 67,863 27,532 95,395
Vessel operating expenses 13,683 11,131 24,814
Depreciation and amortization 18,329 6,827 25,156
General and administrative 3,233 1,511 4,744
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Income from vessel operations 32,618 8,063 40,681
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended June 30, 2012
-------------------------------------------
(unaudited)
Liquefied Gas Conventional
Segment Tanker Segment Total
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Net voyage revenues(1) 67,573 28,662 96,235
Vessel operating expenses 11,774 10,403 22,177
Depreciation and amortization 17,309 7,487 24,796
General and administrative 3,043 1,390 4,433
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Income from vessel operations 35,447 9,382 44,829
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Net voyage revenues represents voyage revenues less voyage expenses,
which comprise all expenses relating to certain voyages, including
bunker fuel expenses, port fees, canal tolls and brokerage commissions.
Net voyage revenues is a non-GAAP financial measure used by certain
investors to measure the financial performance of shipping companies.
Please see Appendix C for a reconciliation of this non-GAAP measure as
used in this release to the most directly comparable GAAP financial
measure.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY LNG PARTNERS L.P.
APPENDIX E - RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
CASH FLOW FROM VESSEL OPERATIONS
FROM CONSOLIDATED VESSELS
(in thousands of U.S. Dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Description of Non-GAAP Financial Measure - Cash Flow from Vessel Operations
from Consolidated Vessels
Cash flow from vessel operations from consolidated vessels represents income
from vessel operations before (a) depreciation and amortization expense, (b)
amortization of in-process revenue contracts included in voyage revenues,
and includes (c) adjustments for direct financing leases and two Suezmax
tankers to a cash basis. The Partnership's only direct financing leases for
the periods indicated relate to the Partnership's 69 percent interest in two
LNG carriers, the Tangguh Sago and Tangguh Hiri. The Partnership's cash flow
from vessel operations from consolidated vessels does not include the
Partnership's cash flow from vessel operations from its equity accounted
joint ventures. Cash flow from vessel operations is included because certain
investors use cash flow from vessel operations to measure a company's
financial performance, and to highlight this measure for the Partnership's
consolidated vessels. Cash flow from vessel operations from consolidated
vessels is not required by GAAP and should not be considered as an
alternative to net income or any other indicator of the Partnership's
performance required by GAAP.
Three Months Ended June 30, 2013
------------------------------------------
(unaudited)
------------------------------------------
Conventional
Liquefied Gas Tanker
Segment Segment Total
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Income from vessel operations (See
Appendix D) 32,618 8,063 40,681
Depreciation and amortization 18,329 6,827 25,156
Amortization of in-process revenue
contracts included in voyage
revenues - (278) (278)
Tangguh LNG revenue accounted for
as direct financing leases (10,971) - (10,971)
Tangguh LNG cash flow from time-
charter contracts 12,605 - 12,605
Realized loss on Toledo Spirit
derivative contract - (23) (23)
Cash flow adjustment for two
Suezmax tankers(1) - (1,697) (1,697)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Cash flow from vessel operations
from consolidated vessels 52,581 12,892 65,473
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended June 30,
2012
-----------------------------
(unaudited)
-----------------------------
Conventional
Liquefied Gas Tanker
Segment Segment Total
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Income from vessel operations (See
Appendix D) 35,447 9,382 44,829
Depreciation and amortization 17,309 7,487 24,796
Amortization of in-process revenue
contracts included in voyage
revenues - (123) (123)
Tangguh LNG revenue accounted for
as direct financing leases (11,025) - (11,025)
Tangguh LNG cash flow from time-
charter contracts 12,528 - 12,528
Realized loss on Toledo Spirit
derivative contract - (6) (6)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Cash flow from vessel operations
from consolidated vessels 54,259 16,740 70,999
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) The Partnership's charter contracts for two of its Suezmax tankers, the
Bermuda Spirit and Hamilton Spirit, were amended in 2012 which had the
effect of reducing the daily charter rates by $12,000 per day for a
duration of 24 months commencing October 1, 2012. The cash impact of the
change in hire rates is not fully reflected in the Partnership's
statements of income as the change in the lease payments are being
recognized on a straight-line basis over the term of the lease.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY LNG PARTNERS L.P.
APPENDIX F - RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
CASH FLOW FROM VESSEL OPERATIONS FROM EQUITY ACCOUNTED VESSELS
(in thousands of U.S. Dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Description of Non-GAAP Financial Measure - Cash Flow from Vessel Operations
from Equity Accounted Vessels
Cash flow from vessel operations from equity accounted vessels represents
income from vessel operations before (a) depreciation and amortization
expense, (b) amortization of in-process revenue contracts and includes (c)
adjustments for direct financing leases to a cash basis. Cash flow from
vessel operations from equity accounted vessels is included because certain
investors use cash flow from vessel operations to measure a company's
financial performance, and to highlight this measure for the Partnership's
equity accounted joint ventures. Cash flow from vessel operations from
equity accounted vessels is not required by GAAP and should not be
considered as an alternative to equity income or any other indicator of the
Partnership's performance required by GAAP.
Three Months Ended June Three Months Ended
30, 2013 June 30, 2012
------------------------------------------------
(unaudited) (unaudited)
-------------- --------------
At Partnership's At Partnership's
100% Portion(1) 100% Portion(1)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Voyage revenues 149,291 68,952 110,043 49,295
Vessel and other operating
expenses 42,385 20,095 24,581 11,223
Depreciation and
amortization 21,284 10,837 13,331 6,874
----------------------------------------------------------------------------
Income from vessel
operations of equity
accounted vessels 85,622 38,019 72,131 31,198
----------------------------------------------------------------------------
Interest expense (17,634) (7,962) (8,051) (4,446)
Realized and unrealized
gain (loss) on derivative
instruments 26,693 8,926 (45,776) (15,420)
Other income - net 140 442 195 (246)
----------------------------------------------------------------------------
Other items 9,199 1,406 (53,632) (20,112)
----------------------------------------------------------------------------
Net income / equity income
of equity accounted
vessels 94,821 39,425 18,499 11,086
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Income from vessel
operations 85,622 38,019 72,131 31,198
Depreciation and
amortization 21,284 10,837 13,331 6,874
Revenue accounted for as
direct financing leases (49,934) (18,247) (49,591) (18,109)
Cash flow from time-charter
contracts 57,095 20,850 56,357 20,574
Amortization of in-process
revenue contracts (8,386) (4,297) (4,818) (2,502)
----------------------------------------------------------------------------
Cash flow from vessel
operations from equity
accounted vessels 105,681 47,162 87,410 38,035
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) The Partnership's equity accounted investments for the three
months ended June 30, 2013 and 2012 include the Partnership's 40
percent interest in Teekay Nakilat (III) Corporation, which owns
four LNG carriers; the Partnership's 50 percent interest in the
Excalibur and Excelsior joint ventures, which owns one LNG carrier
and one regasification unit, respectively; the Partnership's 33
percent interest in four LNG carriers servicing the Angola LNG
Project; and the Partnership's 52 percent interest in MALT LNG
Holdings ApS, the joint venture between the Partnership and
Marubeni Corporation, which owns six LNG carriers. The
Partnership's equity accounted investments for the three months
ended June 30, 2013 also includes the Partnership's acquisition of
a 50 percent interest in Exmar LPG BVBA, the joint venture between
the Partnership and Exmar NV, entered in February 2013, which owns
and charters-in 26 vessels in the LPG carrier segment, including
ten newbuildings.
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:
future growth opportunities, including the Partnership's ability to
successfully bid for new LNG shipping and regasification projects
and/or acquire additional on-the-water assets with contracts;
potential growth in distributable cash flow as a result of such
opportunities and recent vessel transactions; the Partnership's
ability to secure charter contract employment and long-term
financing for the two currently unchartered LNG carrier newbuilding
vessels ordered in July 2013; expected delivery dates for the
Partnership's newbuildings; the expected impact on the
Partnership's cash flows arising from the transaction with Awilco
LNG; the Partnership's potential opportunity to acquire and
bareboat charter a second LNG newbuilding vessel from Awilco; and
LNG and LPG shipping market fundamentals, including the short-term
demand for LNG carrier capacity, future growth in global LNG
supply, and the balance of supply and demand of shipping capacity
and shipping charter rates in these sectors. 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:
shipyard construction delays; availability of LNG shipping, LPG
shipping, floating storage and regasification and other growth
project opportunities; changes in production of LNG or LPG, either
generally or in particular regions; changes in trading patterns or
timing of start-up of new LNG liquefaction and regasification
projects significantly affecting overall vessel tonnage
requirements; the Partnership's ability to secure new contracts
through bidding on project tenders; changes in applicable industry
laws and regulations and the timing of implementation of new laws
and regulations; the potential for early termination of long-term
contracts of existing vessels in the Teekay LNG fleet; the
financial ability of our charterers to pay their charter payments;
the inability of the Partnership to renew or replace long-term
contracts on existing vessels or attain fixed-rate long-term
contracts for newbuilding vessels; the Partnership's ability to
raise financing for its existing newbuildings or to purchase
additional vessels or to pursue other projects; competitive
dynamics in bidding for potential LNG or LPG projects; and other
factors discussed in Teekay LNG Partners' filings from time to time
with the SEC, including its Report on Form 20-F for the fiscal year
ended December 31, 2012. The Partnership expressly disclaims any
obligation 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.
Contacts: Teekay LNG Kent Alekson Investor Relations enquiries
+1 (604) 609-6442 www.teekaylng.com
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