Highlights
Teekay Corporation (Teekay or the Company) (NYSE:TK) today reported
the Company's results for the quarter ended September 30,
2017. These results include the Company’s three
publicly-listed subsidiaries Teekay LNG Partners L.P. (Teekay LNG)
(NYSE:TGP), Teekay Tankers Ltd. (Teekay Tankers) (NYSE:TNK), and
Teekay Offshore Partners L.P. (Teekay Offshore) (NYSE:TOO)
(collectively, the Daughter Entities), and all remaining
subsidiaries of the Company. The Company, together with its
subsidiaries other than the Daughter Entities, is referred to in
this release as Teekay Parent. Please refer to the third
quarter 2017 earnings releases of Teekay LNG, Teekay Tankers and
Teekay Offshore, which are available on the Company’s website at
www.teekay.com, for additional information on their respective
results.
| |
|
| Summary Financial
Information |
|
| |
|
| |
Three Months Ended |
| |
September 30, |
June 30, |
September 30, |
| |
2017 |
2017 |
2016 |
| (in thousands of U.S.
dollars, except per share data) |
(unaudited) |
(unaudited) |
(unaudited) |
| TEEKAY
CORPORATION CONSOLIDATED |
|
|
|
| GAAP FINANCIAL
COMPARISON |
|
|
|
| Revenues |
500,781 |
|
513,923 |
|
547,639 |
|
| (Loss) income from
vessel operations |
(189,846 |
) |
48,286 |
|
89,765 |
|
| Equity income
(loss) |
1,264 |
|
(47,984 |
) |
21,070 |
|
| Net (loss) income
attributable to shareholders of Teekay |
(12,582 |
) |
(80,152 |
) |
6,072 |
|
| (Loss) income per share
attributable to shareholders of Teekay |
(0.15 |
) |
(0.93 |
) |
0.07 |
|
| NON-GAAP
FINANCIAL COMPARISON |
|
|
|
| Total Cash Flow from
Vessel Operations (CFVO)(1) |
238,060 |
|
254,496 |
|
285,514 |
|
| Adjusted Net Loss
attributable to shareholders of Teekay(1) |
(35,638 |
) |
(38,145 |
) |
(19,536 |
) |
| Adjusted Loss per share
attributable to shareholders of Teekay(1) |
(0.41 |
) |
(0.44 |
) |
(0.23 |
) |
| TEEKAY
PARENT |
|
|
|
| NON-GAAP
FINANCIAL COMPARISON |
|
|
|
| Teekay Parent GPCO Cash
Flow(1) |
7,162 |
|
3,287 |
|
6,370 |
|
| Teekay Parent OPCO Cash
Flow(1) |
(19,055 |
) |
(22,854 |
) |
(13,144 |
) |
| Total Teekay Parent
Free Cash Flow(1) |
(11,893 |
) |
(19,567 |
) |
(6,774 |
) |
| |
|
|
|
|
|
|
| (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). |
| |
Teekay LNG and Teekay Tankers are consolidated
in the Company's financial statements and, up to the September 25,
2017 closing of the strategic partnership with Brookfield Business
Partners L.P., together with its institutional partners
(collectively Brookfield), Teekay Offshore was consolidated in the
Company's financial statements. In connection with
Brookfield's acquisition of a 49 percent interest in Teekay
Offshore's general partner, Teekay Offshore GP LLC (or TOO GP),
Teekay and Brookfield entered into an amended limited liability
company agreement whereby Brookfield obtained certain participatory
rights in the management of TOO GP, which resulted in Teekay
deconsolidating Teekay Offshore for accounting purposes on
September 25, 2017. Subsequent to the closing of the Brookfield
transaction, Teekay retains significant influence over Teekay
Offshore and accounts for its investment in Teekay Offshore using
the equity method. Please see “Summary of Recent Events
--Teekay Offshore” for additional information about the Brookfield
transaction.
CEO Commentary
“Since reporting earnings in August 2017, we
have been focused on completing strategic transactions, vessel
deliveries and financing initiatives across the Teekay Group, which
we believe will strengthen each of our businesses,” commented
Kenneth Hvid, Teekay’s President and Chief Executive Officer.
“Teekay and Teekay Offshore have completed their strategic
partnership with Brookfield, Teekay Tankers has secured support
from two leading independent proxy advisory firms for its proposed
charter amendment to permit its merger with TIL, and Teekay LNG
continues to execute on the delivery and financing of its
newbuilding projects." Mr. Hvid continued, “Teekay LNG and
Teekay Offshore’s projects are now starting to deliver which are
expected to provide significant future cash flow growth.”
“With respect to Teekay Parent’s directly-owned
assets, we believe Centrica Energy’s previously announced drilling
campaign on the Chestnut field in the North Sea, which is serviced
by our Hummingbird Spirit FPSO unit, is expected to increase
production, thereby increasing Teekay Parent’s cash flows.
Our new three-year contract extension for the Hummingbird Spirit
FPSO contract took effect in October 2017, and now includes a
component providing potential upside based on oil production and
oil prices, as is also the case with Teekay Parent's other two FPSO
units, the Banff and Foinaven FPSO units.”
Mr. Hvid added, “We are starting to see green
shoots of an energy recovery in our LNG, offshore and crude oil
tanker businesses. With market-leading positions and strong
operational platforms, we believe each of our businesses are
well-positioned to benefit from and take advantage of future
opportunities as our markets continue to recover.”
Summary of Results
Teekay Corporation Consolidated
The Company's consolidated results during the
quarter ended September 30, 2017, compared to the same period of
the prior year, were impacted primarily by $243.7 million of
impairment charges. In addition, as a result of the
Brookfield transaction, the Company recorded a $103.2 million loss
on deconsolidation of Teekay Offshore and recognized previously
deferred gains of $349.6 million within net loss attributable to
non-controlling interests related to previous sales of vessels from
Teekay Parent to Teekay Offshore.
In addition, the Company's consolidated results
were impacted by lower cash flows from Teekay Parent related to the
scheduled maintenance for the Foinaven FPSO unit in the third
quarter of 2017 and an insurance recovery recognized for the Banff
FPSO unit in the third quarter of 2016; lower income and cash flows
from Teekay LNG's six LPG carriers on charter to I.M. Skaugen
(Skaugen) as a result of uncollected hire; a reduction in income
and cash flows in Teekay Tankers due to lower average spot tanker
rates; and lower income and cash flows in Teekay Offshore primarily
due to the redelivery of the Petrojarl Varg (Varg) FPSO unit in
July 2016, the redelivery of an FSO unit in October 2016 and the
non-payment of charter hire for the Arendal Spirit UMS since
early-November 2016 and subsequent charter termination in April
2017.
These decreases were partially offset primarily
by higher results for the Banff FPSO due to a production tariff
linked to oil price commencing August 1, 2017, and higher income
and cash flows from Teekay LNG as a result of the deliveries of two
MEGI LNG carrier newbuildings in 2016 and 2017, the Oak Spirit and
Torben Spirit, which commenced their respective charter
contracts.
Teekay Parent
Teekay Parent GPCO Cash Flow, which includes
distributions and dividends paid to Teekay Parent from Teekay’s
Daughter Entities in the following quarter, less Teekay Parent’s
corporate general and administrative expenses, was $7.2 million for
the quarter ended September 30, 2017, compared to $6.4 million
for the same period of the prior year. This increase was primarily
due to certain cost recoveries from Teekay Offshore in the third
quarter of 2017, partially offset by a reduction in the cash
distribution from Teekay Offshore as a result of the recent
strategic partnership with Brookfield (see “Summary of Recent
Events--Teekay Offshore” below for additional information on this
transaction).
Teekay Parent OPCO Cash Flow, which includes
cash flow attributable to assets directly-owned by, or chartered-in
to, Teekay Parent, net of interest expense and dry-dock
expenditures, decreased to negative $19.1 million for the three
months ended September 30, 2017, from negative $13.1 million
for the same period of the prior year. The decrease was primarily
due to lower revenues and higher repairs and maintenance costs
relating to the scheduled maintenance for the Foinaven FPSO unit in
the third quarter of 2017, the sale of the Shoshone Spirit VLCC in
the fourth quarter of 2016, and lower average spot tanker rates,
partially offset by higher revenues from the Banff FPSO unit due to
a contractual production tariff linked to oil prices which
commenced on August 1, 2017 and the commencement of a one-year
charter contract for the Polar Spirit LNG in the second quarter of
2017 and a seven-month contract for the Arctic Spirit LNG in the
third quarter of 2017.
Total Teekay Parent Free Cash Flow, which is the
total of Teekay Parent GPCO Cash Flow and Teekay Parent OPCO Cash
Flow, was negative $11.9 million during the third quarter of 2017,
compared to negative $6.8 million for the same period of the prior
year. Please refer to Appendix D of this release for
additional information about Teekay Parent Free Cash Flow.
Summary Results of Daughter
Entities
Teekay LNG
Teekay LNG's results decreased during the
quarter ended September 30, 2017, compared to the same period of
the prior year, primarily due to lower revenues from Teekay LNG's
six LPG carriers on charter to Skaugen as a result of uncollected
hire and lower revenues from Teekay LNG’s 50 percent-owned joint
venture with Exmar due to lower spot rates. These decreases
were partially offset by, among other things, the deliveries of two
MEGI LNG carrier newbuildings and the commencement of their
respective charter contracts in 2016 and 2017 and the deliveries of
three mid-size LPG carriers in Teekay LNG's 50 percent-owned joint
venture with Exmar in 2016 and 2017. Please refer to Teekay
LNG's third quarter of 2017 earnings release for additional
information on the financial results for this entity.
Teekay Tankers
Teekay Tankers' results decreased during the
quarter ended September 30, 2017, compared to the same period of
the prior year, primarily due to lower average spot tanker rates in
the third quarter of 2017 compared to the same period of the prior
year. Seasonal weakness, combined with global inventory drawdowns
as crude oil pricing moved into backwardation, contributed to weak
spot tanker rates in the third quarter of 2017. Since that time,
crude tanker rates have improved into the fourth quarter of 2017
supported by refineries returning from seasonal maintenance and an
increase in long-haul movements from the Atlantic to the Pacific,
which is increasing tanker ton-mile demand. Please refer to Teekay
Tankers’ third quarter 2017 earnings release for additional
information on the financial results for this entity.
Teekay Offshore
Teekay Offshore’s results decreased during the
quarter ended September 30, 2017, compared to the same period of
the prior year, primarily due to the redelivery to Teekay Offshore
of the Varg FPSO unit (which left its field at the end of July
2016), the redelivery of an FSO unit in October 2016, the
non-payment of charter hire for the Arendal Spirit UMS since
early-November 2016 and subsequent charter termination, and higher
operating expenses relating to Teekay Offshore's FPSO fleet. These
decreases were partially offset by higher project revenues during
the third quarter of 2017 and lower operating expenses from Teekay
Offshore's shuttle tanker fleet. Please refer to Teekay Offshore’s
third quarter of 2017 earnings release for additional information
on the financial results for this entity.
Summary of Recent Events
Teekay Parent
In October 2017, Teekay Parent terminated the
charter-in contracts prior to their expiration dates for its two
remaining in-chartered conventional tankers, the Constitution
Spirit and Sentinel Spirit, resulting in a net termination fee
payment of approximately $1.6 million, which terminations are
expected to improve Teekay Parent's cash flows in the future.
On November 7, 2017, the U.S. District Court for
the Western District of Washington ruled in the Company's favor on
all claims and dismissed with prejudice the securities law class
action complaint that had been filed against Teekay and certain of
the Company's officers on March 1, 2016 in the U.S. District Court
for the District of Connecticut and which had been transferred to
the U.S. District Court for the Western District of Washington on
November 18, 2016.
Teekay LNG
In October and November 2017, Teekay LNG took
delivery of two MEGI LNG carrier newbuildings, the Macoma and
Murex, chartered to Royal Dutch Shell (Shell), which immediately
commenced their six and seven-year charter contracts, plus
extension options, respectively.
In October 2017, Teekay LNG’s 30-percent owned
joint venture with China LNG Shipping (Holdings) Limited and CETS
(an affiliate of China National Offshore Oil Corporation (CNOOC))
took delivery of an LNG carrier newbuilding, the Pan Asia, which
immediately commenced its 20-year charter contract with Shell.
Teekay Offshore
In September 2017, Teekay Offshore completed the
previously announced strategic partnership with Brookfield, and
related transactions (collectively the Brookfield Transaction),
which included the following, among others:
- Brookfield and Teekay Parent invested $610 million and $30
million, respectively, in Teekay Offshore at a price of $2.50 per
common unit and received 65.5 million Teekay Offshore warrants
(Warrants) on a pro rata basis. Following the transaction,
Brookfield owns approximately 60 percent and Teekay Parent owns
approximately 14 percent of the common units of Teekay
Offshore;
- Brookfield acquired from Teekay Parent both a 49 percent
interest in TOO GP in exchange for $4 million and an option to
acquire an additional two percent of TOO GP, subject to the
satisfaction of certain conditions, in exchange for 1.0 million of
the Warrants issued to Brookfield;
- Teekay Offshore repurchased and canceled all $304 million of
the outstanding Series C-1 and Series D preferred units from the
existing unitholders for an aggregate of approximately $250 million
in cash, which will save approximately $28 million annually in cash
distributions. Concurrently, Teekay Offshore's Series D tranche B
warrants to purchase common units issued on June 29, 2016, were
amended to reduce the exercise price from $6.05 to $4.55;
- Teekay Offshore extended the mandatory prepayment date for the
Arendal Spirit UMS debt facility to September 30, 2018 in exchange
for a principal prepayment of $30 million;
- Brookfield acquired from Teekay Parent an existing $200 million
loan, previously extended to Teekay Offshore, in exchange for $140
million in cash and 11.4 million of the Warrants initially issued
to Brookfield. Brookfield extended the maturity date of the loan
from 2019 to 2022;
- Teekay Offshore transferred its shuttle tanker business into a
new, wholly-owned, non-recourse subsidiary, Teekay Shuttle Tankers
L.L.C. (ShuttleCo). As part of the formation of ShuttleCo, a
majority of Teekay Offshore's shuttle tanker fleet was refinanced
with a new $600 million, five-year debt facility, and two 50
percent-owned vessels were refinanced with a new $71 million,
four-year debt facility. In addition, an existing $250 million debt
facility secured by the three East Coast of Canada newbuildings,
and an existing $141 million private placement bond secured by two
vessels, were transferred from Teekay Offshore to ShuttleCo;
- All of Teekay Offshore's existing NOK bonds due to mature in
late-2018 are expected to be repurchased with proceeds from a new
five-year $250 million U.S. Dollar denominated bond offering by
ShuttleCo in the Norwegian bond market, which priced at a fixed
coupon of 7.125 percent per annum; and
- Certain financial institutions providing interest rate swaps to
Teekay Offshore (i) lowered the fixed interest rate on the swaps,
(ii) extended the termination option of the swaps by two years to
2021, and (iii) eliminated the financial guarantee and security
package currently provided by Teekay Parent in return for a
prepayment amount and fees.
In October 2017, the Randgrid FSO
unit, which was converted from one of Teekay Offshore’s shuttle
tankers at Sembcorp’s Sembawang shipyard in Singapore, commenced
its charter contract with Statoil on the Gina Krog oil and gas
field in the Norwegian sector of the North Sea.
In November 2017, Teekay Offshore entered into a
heads of terms with Premier Oil to extend the employment of the
Voyageur Spirit FPSO unit on the Huntington field for an additional
twelve months out to April 2019. The new contract, which will
take effect in April 2018, will include a fixed rate component and
an upside component based on the oil production and oil prices.
Teekay Offshore received notice from the
charterer, Petrobras, that it plans to redeliver the Rio das Ostras
FPSO unit to Teekay Offshore upon completion of the unit's firm
charter contract in January 2018. As a result, Teekay Offshore is
seeking redeployment opportunities.
In October and November 2017, Teekay Offshore
took delivery of the first two East Coast Canada shuttle tanker
newbuildings, the Beothuk Spirit and Norse Spirit, which are
scheduled to commence long-term charters in December 2017 and
January 2018 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. These newbuildings will replace
two existing shuttle tankers that are currently operating in East
Coast Canada, with the first replaced vessel transferring to the
North Sea to provide required capacity in Teekay Offshore's
Contract of Affreighment (CoA) fleet and the second replaced vessel
redelivering to its owner.
In October 2017, Teekay Offshore took delivery
of the third of four state-of-the-art SX-157 Ulstein Design
ultra-long distance towing and offshore installation newbuildings,
the ALP Sweeper, constructed by Niigata Shipbuilding & Repair
in Japan. Due to the delayed delivery of the vessel, Teekay
Offshore received a reimbursement from the shipyard of $8.1
million.
Teekay Tankers
Teekay Tankers has entered into a voting and
support agreement with its second largest shareholder, Huber
Capital Management LLC (Huber Capital), whereby Huber Capital will
vote its shares in favor of increasing the authorized number of
Teekay Tankers’ Class A common shares at an upcoming November 17,
2017 special meeting of shareholders, to permit the issuance of
Class A common shares as consideration to complete its proposed
merger with TIL.
In November 2017, two leading independent proxy
advisory firms, Institutional Shareholder Services Inc. (ISS) and
Glass, Lewis & Co., LLC (Glass Lewis), both recommended that
Teekay Tankers' shareholder vote "FOR" the proposed charter
amendment, which will allow Teekay Tankers to effect its proposed
merger with TIL, which owns 18 mid-size conventional tankers.
ISS and Glass Lewis are leading independent international proxy
advisory firms, and their voting analyses and recommendations are
relied upon by thousands of major institutional investment firms,
mutual funds and fiduciaries throughout the world.
Since August 2017, Teekay Tankers has entered
into agreements to sell two 1999-built Aframax tankers for
aggregate proceeds of approximately $12.7 million. One Aframax
tanker delivered to the buyer in September 2017 and the other is
expected to be delivered to the buyer in the second half of
November 2017.
In September 2017, Teekay Tankers announced that
its Board of Directors had authorized a share repurchase program
for the repurchase of up to $45 million of Teekay Tankers' Class A
common shares. Shares may be repurchased in the open market
at times and prices considered appropriate by Teekay Tankers.
Teekay Tankers secured a time charter-out
contract on an Aframax tanker for a firm period of 12 months at a
daily rate of $15,000, plus a 12-month extension option at a higher
rate, which commenced in October 2017.
Liquidity
As at September 30, 2017, Teekay Parent had
total liquidity of approximately $271.9 million (consisting of
$231.7 million of cash and cash equivalents and $40.2 million of
undrawn revolving credit facilities) and, on a consolidated basis,
Teekay had consolidated total liquidity of approximately $627.7
million (consisting of $453.3 million of cash and cash equivalents
and $174.4 million of undrawn revolving credit facilities).
Giving pro-forma effect to Teekay LNG’s $170 million preferred unit
issuance in October 2017, Teekay’s consolidated total liquidity at
September 30, 2017 would have been approximately $792 million.
As a result of the deconsolidation of Teekay
Offshore as of September 25, 2017, Teekay's consolidated total
liquidity excludes Teekay Offshore's total liquidity of
approximately $416.3 million (excludes $24.3 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).
Conference Call
The Company plans to host a conference call on
Thursday, November 9, 2017 at 2:00 p.m. (ET) to discuss its results
for the third quarter of 2017. An accompanying investor
presentation will be available on Teekay’s website at
www.teekay.com prior to the start of the call. All
shareholders and interested parties are invited to listen to the
live conference call by choosing from the following options:
- By dialing (866) 548-4713 or (416) 640-5944, if outside North
America, and quoting conference ID code 3371748.
- By accessing the webcast, which will be available on Teekay’s
website at www.teekay.com (the archive will remain on the
website for a period of one year).
An accompanying Third Quarter Earnings
Presentation will also be available at www.teekay.com in
advance of the conference call start time.
About Teekay
Teekay Corporation operates in the marine
midstream space through its ownership of the general partner and a
portion of the outstanding limited partner interests in Teekay LNG
Partners L.P. (NYSE:TGP) and an interest in the general partner and
a portion of the outstanding limited partner interests in Teekay
Offshore Partners L.P. (NYSE:TOO). The general partners own all of
the outstanding incentive distribution rights of these entities. In
addition, Teekay has a controlling ownership interest in Teekay
Tankers Ltd. (NYSE:TNK) and directly owns a fleet of vessels. The
combined Teekay entities manage and operate consolidated assets of
approximately $7.4 billion, comprised of approximately 220
liquefied gas, offshore, and conventional tanker assets. With
offices in 14 countries and approximately 8,000 seagoing and
shore-based employees, Teekay provides a comprehensive set of
marine services to the world’s leading oil and gas companies.
Teekay’s common stock is listed on the New York
Stock Exchange where it trades under the symbol “TK”.
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 Loss Attributable to Shareholders of Teekay, Teekay
Parent GPCO Cash Flow, Teekay Parent OPCO Cash Flow, Teekay Parent
Free Cash Flow, Net Interest Expense and Adjusted Equity Income,
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 Company believes
that certain investors use this information to evaluate the
Company’s financial performance, as does management.
Non-GAAP Financial Measures
Cash Flow from Vessel Operations (CFVO)
represents income from vessel operations before depreciation and
amortization expense, amortization of in-process revenue contracts,
asset impairments, gains or losses on the sale of vessels and
equipment, 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 and a derivative charter contract.
CFVO - Consolidated represents CFVO from vessels that are
consolidated on the Company’s financial statements. CFVO - Equity
Investments represents the Company’s proportionate share of CFVO
from its equity-accounted vessels and other investments. The
Company does not control its equity-accounted vessels and
investments and as a result, the Company does not have the
unilateral ability to determine whether the cash generated by its
equity-accounted vessels and other investments is retained within
the entities in which the Company holds the equity accounted
investment or distributed to the Company and other owners. In
addition, the Company does not control the timing of such
distributions to the Company and other owners. Consequently,
readers are cautioned when using total CFVO as a liquidity measure
as the amount contributed from CFVO - Equity Investments may not be
available to the Company in the periods such CFVO is generated by
its equity-accounted vessels and other investments. 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 C and E of this release
for reconciliations of these non-GAAP financial measures to income
from vessel operations and income from vessel operations of equity
accounted vessels, respectively, the most directly comparable GAAP
measures reflected in the Company’s consolidated financial
statements.
Adjusted Net Loss excludes items of income or
loss from GAAP net (loss) income that are typically excluded by
securities analysts in their published estimates of the Company’s
financial results. The Company believes that certain investors use
this information to evaluate the Company’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 (loss)
income, and refer to footnote (4) of the income statement for a
reconciliation of adjusted equity income to equity income (loss),
the most directly comparable GAAP measure reflected in the
Company’s consolidated financial statements.
Teekay Parent Financial
Measures
Teekay Parent Free Cash Flow represents the sum
of (a) distributions or dividends (including payments in kind)
relating to a given quarter (but received by Teekay Parent in the
following quarter) as a result of ownership interests in its
publicly-traded subsidiaries (Teekay LNG, Teekay Offshore, and
Teekay Tankers) net of Teekay Parent’s corporate general and
administrative expenditures for the given quarter (collectively,
Teekay Parent GPCO Cash Flow) plus (b) CFVO attributed to Teekay
Parent’s directly-owned and chartered-in assets, less Teekay
Parent’s net interest expense and dry-dock expenditures for the
given quarter (collectively, Teekay Parent OPCO Cash Flow).
Net Interest Expense includes interest expense, interest income and
realized gains and losses on interest rate swaps. Please refer to
Appendices B, C, D and E of this release for further details and
reconciliations of these non-GAAP financial measures to the most
directly comparable GAAP measures reflected in the Company’s
consolidated financial statements.
|
|
| Teekay
Corporation |
| Summary
Consolidated Statements of (Loss) Income |
| (in
thousands of U.S. dollars, except share and per share data) |
| |
|
|
| |
Three Months Ended |
Nine Months Ended |
| |
September 30, |
June 30, |
September 30, |
September 30, |
September 30, |
| |
2017 |
2017 |
2016 |
2017 |
2016 |
| |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
| |
|
|
|
|
|
| Revenues(1) |
500,781 |
|
513,923 |
|
547,639 |
|
1,558,209 |
|
1,776,366 |
|
| |
|
|
|
|
|
| Voyage expenses |
(42,454 |
) |
(40,640 |
) |
(37,213 |
) |
(133,891 |
) |
(97,102 |
) |
| Vessel operating
expenses |
(200,456 |
) |
(207,784 |
) |
(204,156 |
) |
(599,500 |
) |
(625,672 |
) |
| Time-charter hire
expense |
(28,645 |
) |
(30,689 |
) |
(33,810 |
) |
(98,106 |
) |
(111,727 |
) |
| Depreciation and
amortization |
(136,942 |
) |
(142,741 |
) |
(141,688 |
) |
(422,713 |
) |
(426,924 |
) |
| General and
administrative expenses |
(27,662 |
) |
(29,541 |
) |
(30,052 |
) |
(88,641 |
) |
(92,890 |
) |
| Asset
impairments(2) |
(243,659 |
) |
(1,500 |
) |
— |
|
(245,159 |
) |
(43,649 |
) |
| Net loss on sale of
vessels, equipment and other operating assets |
(7,926 |
) |
(12,742 |
) |
(7,838 |
) |
(25,095 |
) |
(54,413 |
) |
|
Restructuring charges(1) |
(2,883 |
) |
— |
|
(3,117 |
) |
(5,059 |
) |
(22,921 |
) |
| (Loss) income
from vessel operations |
(189,846 |
) |
48,286 |
|
89,765 |
|
(59,955 |
) |
301,068 |
|
| |
|
|
|
|
|
| Interest expense |
(74,499 |
) |
(74,383 |
) |
(68,490 |
) |
(219,237 |
) |
(213,948 |
) |
| Interest income |
1,900 |
|
1,536 |
|
1,143 |
|
4,917 |
|
3,507 |
|
| Realized and unrealized
(loss) gain on |
|
|
|
|
|
|
non-designated derivative instruments(3) |
(6,128 |
) |
(30,570 |
) |
29,926 |
|
(43,173 |
) |
(166,967 |
) |
| Equity income
(loss)(4) |
1,264 |
|
(47,984 |
) |
21,070 |
|
(36,373 |
) |
73,706 |
|
| Income tax (expense)
recovery |
(5,221 |
) |
(3,527 |
) |
133 |
|
(11,767 |
) |
(2,366 |
) |
| Foreign exchange (loss)
gain |
(2,642 |
) |
(17,342 |
) |
6,116 |
|
(22,888 |
) |
(19,555 |
) |
| Loss on deconsolidation
of Teekay Offshore(5) |
(103,188 |
) |
— |
|
— |
|
(103,188 |
) |
— |
|
| Other (loss) income –
net |
(4,705 |
) |
(759 |
) |
480 |
|
(5,169 |
) |
(20,806 |
) |
|
Net (loss) income |
(383,065 |
) |
(124,743 |
) |
80,143 |
|
(496,833 |
) |
(45,361 |
) |
| Less: Net loss
(income) attributable |
|
|
|
|
|
|
to non-controlling interests(6) |
370,483 |
|
44,591 |
|
(74,071 |
) |
358,843 |
|
(75,159 |
) |
| Net (loss) income attributable to
the shareholders of Teekay
Corporation |
|
|
|
|
|
|
(12,582 |
) |
(80,152 |
) |
6,072 |
|
(137,990 |
) |
(120,520 |
) |
| Loss per common share
of Teekay Corporation |
|
|
|
|
|
| -
Basic |
(0.15 |
) |
(0.93 |
) |
0.07 |
|
(1.60 |
) |
(1.63 |
) |
|
- Diluted |
(0.15 |
) |
(0.93 |
) |
0.07 |
|
(1.60 |
) |
(1.63 |
) |
| |
|
|
|
|
|
| Weighted-average number
of common shares |
|
|
|
|
|
|
outstanding |
|
|
|
|
|
| -
Basic |
86,261,330 |
|
86,259,207 |
|
84,887,101 |
|
86,232,315 |
|
76,887,689 |
|
|
- Diluted |
86,261,330 |
|
86,259,207 |
|
84,973,745 |
|
86,232,315 |
|
76,887,689 |
|
(1) Restructuring charges for the three and nine months ended
September 30, 2017 primarily relate to severance costs from the
termination of the charter contract for Teekay Offshore's Arendal
Spirit UMS. Restructuring charges for the nine months ended
September 30, 2017 also relate to the reorganization and
realignment of resources of the Company's strategic development
function. Restructuring charges for the three and nine months ended
September 30, 2016 primarily relate to the closure of offices and
seafarers' severance amounts, part of which were recovered from the
customer and which recovery was included in revenues in the
consolidated statements of income (loss) for the three and nine
months ended September 30, 2016. Restructuring charges for the
three and nine months ended September 30, 2016 also include costs
related to the reorganization of the Company's FPSO business.
(2) Asset impairments for the three and nine months ended
September 30, 2017 primarily relate to the impairments of two FPSO
units in Teekay Parent. Factors contributing to the impairments
included changes to the estimated cash flows and carrying values of
the asset group for impairment assessment purposes under GAAP as a
result of the deconsolidation of Teekay Offshore on September 25,
2017, and a re-evaluation of the estimated future net cash flows of
the units. Asset impairments for the three and nine months
ended September 30, 2017 also include the impairments of three
Suezmax tankers in Teekay LNG. Please refer to Teekay LNG’s
third quarter 2017 earnings release for additional information on
the asset impairments. Asset impairments for the nine months
ended September 30, 2016 relate to the write-downs of two units for
maintenance and safety (UMS) newbuildings as a result of the
cancellation of the related construction contracts by Teekay
Offshore's subsidiaries within Logitel Offshore Pte. Ltd.
(3) Realized and unrealized (losses) gains related to derivative
instruments that are not designated as hedges for accounting
purposes are included as a separate line item in the consolidated
statements of (loss) income. The realized (losses) gains relate to
the amounts the Company actually paid to settle such 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 |
Nine Months Ended |
| |
|
September 30, |
June 30, |
September 30, |
September 30, |
September 30, |
| |
|
2017 |
2017 |
2016 |
2017 |
2016 |
| |
|
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
| Realized
(losses) gains relating to: |
|
|
|
|
|
| |
Interest rate
swaps |
(15,729 |
) |
(15,913 |
) |
(22,219 |
) |
(48,199 |
) |
(67,808 |
) |
| |
Termination of interest
rate swaps |
— |
|
(1,006 |
) |
— |
|
(610 |
) |
(8,140 |
) |
| |
Foreign currency
forward contracts |
1,609 |
|
(618 |
) |
(2,583 |
) |
638 |
|
(9,915 |
) |
| |
Time-charter swaps |
— |
|
360 |
|
1,096 |
|
1,106 |
|
1,222 |
|
| |
Forward freight
agreements |
234 |
|
81 |
|
— |
|
347 |
|
— |
|
| |
|
(13,886 |
) |
(17,096 |
) |
(23,706 |
) |
(46,718 |
) |
(84,641 |
) |
| Unrealized
gains (losses) relating to: |
|
|
|
|
|
| |
Interest rate
swaps |
11,575 |
|
(15,517 |
) |
47,816 |
|
5,181 |
|
(96,055 |
) |
| |
Foreign currency
forward contracts |
735 |
|
2,809 |
|
6,006 |
|
4,383 |
|
21,070 |
|
| |
Stock purchase
warrants |
(4,461 |
) |
(332 |
) |
(398 |
) |
(5,036 |
) |
(8,894 |
) |
| |
Time-charter swap |
— |
|
(402 |
) |
208 |
|
(875 |
) |
1,553 |
|
| |
Forward freight
agreements |
(91 |
) |
(32 |
) |
— |
|
(108 |
) |
— |
|
| |
|
7,758 |
|
(13,474 |
) |
53,632 |
|
3,545 |
|
(82,326 |
) |
| Total realized and unrealized (losses) gains on
non-designated derivative instruments |
(6,128 |
) |
(30,570 |
) |
29,926 |
|
(43,173 |
) |
(166,967 |
) |
(4) The Company’s proportionate share of items within equity
income (loss) as identified in Appendix A of this release is
detailed in the table below. By excluding these items from equity
income (loss) as reflected in the consolidated statements of (loss)
income, the Company believes the resulting adjusted equity income
is a normalized amount that can be used to evaluate the financial
performance of the Company’s equity accounted investments. Adjusted
equity income is a non-GAAP financial measure.
| |
|
Three Months Ended |
Nine Months Ended |
| |
|
September 30, |
June 30, |
September 30, |
September 30, |
September 30, |
| |
|
2017 |
2017 |
2016 |
2017 |
2016 |
| |
|
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
| Equity
income (loss) |
1,264 |
|
(47,984 |
) |
21,070 |
|
(36,373 |
) |
73,706 |
|
|
Proportionate share of unrealized (gains) losses on derivative
instruments |
(3,804 |
) |
3,853 |
|
(6,616 |
) |
(2,026 |
) |
(1,921 |
) |
| Other(i) |
6,963 |
|
49,994 |
|
(2,526 |
) |
57,719 |
|
(1,517 |
) |
| Equity income adjusted for items in Appendix A |
4,423 |
|
5,863 |
|
11,928 |
|
19,320 |
|
70,268 |
|
(i) Other for the three and nine months ended September 30, 2017
include realized losses on cross-currency swap and interest rate
swap amendments in Teekay Offshore and foreign currency exchange
gains and losses in the Company's equity accounted investments.
Refer to footnote (2) of Appendix A included in this release for
further details. Other for the three months ended June 30, 2017 and
nine months ended September 30, 2017 include the write-down of the
Company's and Teekay Tankers' equity investments in TIL to their
estimated fair value, based on the best available indication of
fair value at June 30, 2017, which was the TIL share price as on
that date. This resulted in a consolidated non-cash
impairment charge of $48.6 million during the quarter ended June
30, 2017, related to their equity investments in TIL.
(5) In connection with Brookfield's acquisition of the 49
percent interest in TOO GP, Teekay and Brookfield entered into an
amended limited liability company agreement whereby Brookfield
obtained certain participatory rights in the management of TOO GP,
which resulted in Teekay deconsolidating Teekay Offshore for
accounting purposes on September 25, 2017. Subsequent to the
closing of the Brookfield transaction, Teekay retains significant
influence over Teekay Offshore and accounts for its investment in
Teekay Offshore using the equity method.
The following table shows the impact from the
deconsolidation of Teekay Offshore on September 25, 2017. On such
date, the Company recognized both the net cash proceeds it received
as part of the Brookfield transaction and the fair value of its
retained interests in Teekay Offshore, including common units,
warrants, intercorporate loans and vessel charters with Teekay
Offshore, and derecognized the carrying value of both Teekay
Offshore’s net assets and the non-controlling interest in Teekay
Offshore, with the difference between the amounts recognized and
derecognized being the loss on deconsolidation.
|
|
As of September 25, 2017 |
| |
(unaudited) |
| Net cash proceeds
received by Teekay |
139,693 |
|
| Fair value of Teekay's
net investment in Teekay Offshore |
203,140 |
|
| Carrying
value of the non-controlling interest in Teekay Offshore |
1,138,275 |
|
| Subtotal |
1,481,108 |
|
| Less: |
|
| Carrying value of
Teekay Offshore's net assets on deconsolidation |
(1,584,296 |
) |
|
Loss on deconsolidation of Teekay Offshore |
(103,188 |
) |
(6) Subsequent to the formation of the Daughter Entities, Teekay
sold certain vessels to the Daughter Entities. Even though
the Daughter Entities were not wholly-owned subsidiaries of Teekay,
all of the gain or loss on sales of these vessels was fully
eliminated upon consolidation. Consequently, the portion of the
gain or loss attributable to Teekay’s reduced interest in the
vessels was deferred. The total unrecognized net deferred gain
relating to the vessels previously sold from Teekay to Teekay
Offshore was $349.6 million. Upon deconsolidation of Teekay
Offshore, such amount was recognized in net loss (income)
attributable to non-controlling interests.
|
|
| Teekay
Corporation |
| Summary
Consolidated Balance Sheets |
| (in
thousands of U.S. dollars) |
| |
|
|
|
| |
As at September 30, |
As at June 30, |
As at December 31, |
| |
2017(1) |
2017 |
2016 |
| |
(unaudited) |
(unaudited) |
(unaudited) |
|
ASSETS |
|
| Cash and
cash equivalents - Teekay Parent |
231,669 |
|
110,249 |
|
146,362 |
|
| Cash and
cash equivalents - Teekay LNG |
161,008 |
|
191,110 |
|
126,146 |
|
| Cash and
cash equivalents - Teekay Offshore |
— |
|
212,267 |
|
227,378 |
|
| Cash and
cash equivalents - Teekay Tankers |
60,606 |
|
87,255 |
|
68,108 |
|
| Other
current assets |
339,277 |
|
331,954 |
|
389,727 |
|
| Restricted
cash - Teekay Parent |
4,820 |
|
4,534 |
|
4,562 |
|
| Restricted
cash - Teekay LNG |
93,012 |
|
108,243 |
|
117,027 |
|
| Restricted
cash - Teekay Offshore |
— |
|
99,720 |
|
114,909 |
|
| Restricted
cash - Teekay Tankers |
4,317 |
|
1,380 |
|
750 |
|
| Assets held
for sale |
23,400 |
|
23,900 |
|
61,282 |
|
| Vessels and
equipment - Teekay Parent |
346,090 |
|
568,042 |
|
602,672 |
|
| Vessels and
equipment - Teekay LNG |
1,960,207 |
|
2,014,909 |
|
1,858,381 |
|
| Vessels and
equipment - Teekay Offshore |
— |
|
3,997,446 |
|
4,084,803 |
|
| Vessels and
equipment - Teekay Tankers |
1,514,685 |
|
1,554,055 |
|
1,605,372 |
|
| Advances on
newbuilding contracts/conversions |
492,800 |
|
1,082,277 |
|
987,658 |
|
| Investment
in equity accounted investees(1) |
1,187,648 |
|
978,266 |
|
1,010,308 |
|
| Investment
in direct financing leases |
633,805 |
|
653,846 |
|
660,594 |
|
| Other
assets |
235,863 |
|
491,883 |
|
482,908 |
|
| Intangible
assets |
97,949 |
|
82,466 |
|
89,175 |
|
|
Goodwill |
43,692 |
|
176,630 |
|
176,630 |
|
| Total Assets |
7,430,848 |
|
12,770,432 |
|
12,814,752 |
|
|
LIABILITIES AND EQUITY |
|
|
| Accounts
payable and accrued liabilities |
217,771 |
|
437,564 |
|
448,670 |
|
| Advances
from affiliates |
79,208 |
|
12,275 |
|
8,522 |
|
| Current
portion of long-term debt - Teekay Parent |
52,115 |
|
52,113 |
|
52,169 |
|
| Current
portion of long-term debt - Teekay LNG |
624,824 |
|
301,236 |
|
228,864 |
|
| Current
portion of long-term debt - Teekay Offshore |
— |
|
891,558 |
|
586,892 |
|
| Current
portion of long-term debt - Teekay Tankers |
166,185 |
|
150,254 |
|
171,019 |
|
| Long-term
debt - Teekay Parent |
754,085 |
|
730,892 |
|
680,241 |
|
| Long-term
debt - Teekay LNG |
1,975,849 |
|
2,192,615 |
|
1,955,201 |
|
| Long-term
debt - Teekay Offshore |
— |
|
2,252,561 |
|
2,596,002 |
|
| Long-term
debt - Teekay Tankers |
630,676 |
|
671,532 |
|
761,997 |
|
| Derivative
liabilities |
134,244 |
|
481,564 |
|
530,854 |
|
| In process
revenue contracts |
42,618 |
|
103,884 |
|
122,690 |
|
| Other
long-term liabilities |
131,115 |
|
328,823 |
|
333,236 |
|
| Redeemable
non-controlling interest |
— |
|
249,778 |
|
249,102 |
|
|
Equity: |
|
|
|
|
Non-controlling interests |
1,833,095 |
|
3,108,941 |
|
3,189,928 |
|
|
Shareholders of Teekay |
789,063 |
|
804,842 |
|
899,365 |
|
| Total Liabilities and Equity |
7,430,848 |
|
12,770,432 |
|
12,814,752 |
|
| Net debt -
Teekay Parent(2) |
569,711 |
|
668,222 |
|
581,486 |
|
| Net debt -
Teekay LNG(2) |
2,346,653 |
|
2,194,498 |
|
1,940,892 |
|
| Net debt -
Teekay Offshore(2) |
— |
|
2,832,132 |
|
2,840,607 |
|
| Net debt - Teekay Tankers(2) |
731,938 |
|
733,151 |
|
864,158 |
|
|
|
| (1) Refer
to footnote (5) of the summary consolidated statements of (loss)
income included in this release for further details. |
| (2) Net
debt is a non-GAAP financial measure and represents current and
long-term debt less cash and cash equivalents and, if applicable,
restricted cash. |
|
|
| |
|
| Teekay
Corporation |
| Summary
Consolidated Statements of Cash Flows |
| (in
thousands of U.S. dollars) |
| |
|
| |
Nine Months Ended |
| |
September 30, |
| |
2017 |
2016 |
| |
(unaudited) |
(unaudited) |
| Cash and cash
equivalents provided by (used for) |
|
|
| OPERATING
ACTIVITIES |
|
|
| Net loss |
(496,833 |
) |
(45,361 |
) |
| Non-cash items: |
|
|
|
Depreciation and amortization |
422,713 |
|
426,924 |
|
|
Amortization of in-process revenue contracts |
(22,307 |
) |
(21,191 |
) |
|
Unrealized gains on derivative instruments |
(94,532 |
) |
(10,847 |
) |
| Net loss
on sale of vessels, equipment and other operating assets |
25,095 |
|
43,649 |
|
| Asset
impairments |
245,159 |
|
54,413 |
|
| Equity
loss (income), net of dividends received |
72,159 |
|
(37,393 |
) |
| Income
tax expense |
11,767 |
|
2,366 |
|
|
Unrealized foreign exchange loss and other |
111,216 |
|
96,257 |
|
|
Deconsolidation loss |
103,188 |
|
— |
|
| Change in operating
assets and liabilities |
72,558 |
|
28,797 |
|
| Expenditures for dry
docking |
(38,704 |
) |
(33,841 |
) |
|
Net operating cash flow |
411,479 |
|
503,773 |
|
| |
|
|
| FINANCING
ACTIVITIES |
|
|
| Proceeds from issuance
of long-term debt, net of issuance costs |
680,261 |
|
1,568,348 |
|
| Prepayments of
long-term debt |
(314,029 |
) |
(1,532,606 |
) |
| Scheduled repayments of
long-term debt |
(615,337 |
) |
(616,343 |
) |
| Decrease in restricted
cash |
105,999 |
|
27,384 |
|
| Net proceeds from
equity issuances of subsidiaries |
8,521 |
|
190,007 |
|
| Net proceeds from
equity issuances of Teekay Corporation |
— |
|
101,900 |
|
| Distributions paid from
subsidiaries to non-controlling interests |
(88,133 |
) |
(98,657 |
) |
| Cash dividends
paid |
(14,235 |
) |
(12,667 |
) |
| Proceeds from
sales-leaseback of vessels |
153,000 |
|
— |
|
| Other financing
activities |
(24,348 |
) |
(17,567 |
) |
|
Net financing cash flow |
(108,301 |
) |
(390,201 |
) |
| |
|
|
| INVESTING
ACTIVITIES |
|
|
| Expenditures for
vessels and equipment |
(694,507 |
) |
(547,345 |
) |
| Proceeds from sale of
vessels and equipment |
67,440 |
|
163,588 |
|
| Proceeds from
sale-leaseback of vessels |
335,830 |
|
355,306 |
|
| Investment in
equity-accounted investments |
(109,580 |
) |
(63,120 |
) |
| Advances to joint
ventures and joint venture partners |
(12,576 |
) |
(12,259 |
) |
| Cash of Teekay Offshore
upon deconsolidation, net of proceeds received |
(17,977 |
) |
— |
|
| Other investing
activities |
13,481 |
|
17,162 |
|
|
Net investing cash flow |
(417,889 |
) |
(86,668 |
) |
| |
|
|
| (Decrease)
increase in cash and cash equivalents |
(114,711 |
) |
26,904 |
|
| Cash and cash
equivalents, beginning of the period |
567,994 |
|
678,392 |
|
|
Cash and cash equivalents, end of the period |
453,283 |
|
705,296 |
|
| |
| |
|
|
| Teekay
Corporation |
| Appendix A
- Reconciliation of Non-GAAP Financial Measures |
| Adjusted
Net Loss |
| (in
thousands of U.S. dollars, except per share data) |
| |
|
|
| |
|
Three Months Ended |
| |
|
September 30, |
June 30, |
September 30, |
| |
|
2017 |
2017 |
2016 |
| |
|
(unaudited) |
(unaudited) |
(unaudited) |
| |
|
|
$ Per |
|
$ Per |
|
$ Per |
| |
|
$ |
Share(1) |
$ |
Share(1) |
$ |
Share(1) |
| Net (loss)
income – GAAP basis |
(383,065 |
) |
|
(124,743 |
) |
|
80,143 |
|
|
| Adjust for:
Net loss (income) attributable to |
|
|
|
|
|
|
| non-controlling interests |
370,483 |
|
|
44,591 |
|
|
(74,071 |
) |
|
| Net
(loss) income attributable to |
|
|
|
|
|
|
| |
shareholders of Teekay |
(12,582 |
) |
(0.15 |
) |
(80,152 |
) |
(0.93 |
) |
6,072 |
|
0.07 |
|
| Add
(subtract) specific items affecting net (loss): |
|
|
|
|
|
|
| |
Unrealized (gains)
losses from derivative instruments(2) |
(11,555 |
) |
(0.13 |
) |
18,148 |
|
0.21 |
|
(60,245 |
) |
(0.72 |
) |
| |
Foreign exchange
(gains) losses(3) |
(853 |
) |
(0.01 |
) |
12,263 |
|
0.14 |
|
(11,815 |
) |
(0.14 |
) |
| |
Net loss on sale of
vessels, equipment and other operating assets |
7,926 |
|
0.09 |
|
12,742 |
|
0.15 |
|
(2,931 |
) |
(0.03 |
) |
| |
Asset
impairments(4) |
243,659 |
|
2.82 |
|
50,071 |
|
0.58 |
|
8,330 |
|
0.10 |
|
| |
Restructuring charges,
net of recovery(5) |
2,909 |
|
0.03 |
|
— |
|
— |
|
1,687 |
|
0.02 |
|
| |
Realized loss on
interest rate swap amendments |
5,347 |
|
0.06 |
|
— |
|
— |
|
— |
|
— |
|
| |
Loss on deconsolidation
of Teekay Offshore(6) |
103,188 |
|
1.20 |
|
— |
|
— |
|
— |
|
— |
|
| |
Other(7) |
8,371 |
|
0.10 |
|
17,311 |
|
0.20 |
|
582 |
|
0.01 |
|
| |
Non-controlling interests’ share of items above(8) |
(382,048 |
) |
(4.42 |
) |
(68,528 |
) |
(0.79 |
) |
38,784 |
|
0.46 |
|
| Total adjustments |
(23,056 |
) |
(0.26 |
) |
42,007 |
|
0.49 |
|
(25,608 |
) |
(0.30 |
) |
|
Adjusted net loss attributable to |
|
|
|
|
|
|
| |
shareholders of Teekay |
(35,638 |
) |
(0.41 |
) |
(38,145 |
) |
(0.44 |
) |
(19,536 |
) |
(0.23 |
) |
|
|
|
(1) Basic per share amounts. |
|
(2) Reflects the unrealized (gains) losses relating to the
change in the mark-to-market value of derivative instruments that
are not designated as hedges for accounting purposes, including
those investments included in the Company's proportionate share of
equity income (loss) from joint ventures, and hedge ineffectiveness
from derivative instruments designated as hedges for accounting
purposes. |
|
(3) Foreign currency exchange (gains) losses primarily relate
to the Company’s debt denominated in Euros and Norwegian Kroner
(NOK) and unrealized losses on cross currency swaps used to
economically hedge the principal and interest on NOK bonds. Nearly
all of the Company’s foreign currency exchange gains and losses are
unrealized. |
|
(4) Refer to footnote (4) of the summary consolidated
statements of (loss) income included in this release for further
details. |
|
(5) Refer to footnote (1) of the summary consolidated
statements of (loss) income included in this release for further
details. |
|
(6) Refer to footnote (5) of the summary consolidated
statements of (loss) income included in this release for further
details. |
|
(7) Other for the three months ended September 30, 2017
primarily relates to the settlement of a contingent liability in
Teekay Offshore, legal fees associated with the Brookfield
transaction, legal fees associated with Teekay Tanker's proposed
merger with TIL, and costs, including those associated with
interest rate swaps, related to projects during their
pre-operational phases. |
|
(8) Items affecting net income include items from the
Company’s consolidated non-wholly-owned subsidiaries. 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 determine 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 listed in the table.
“Non-controlling interests’ share of items above” for the three
months ended September 30, 2017 also includes the recognition of
previously deferred gains of $349.6 million. See footnote (6)
of the summary consolidated statements of (loss) income included in
this release for further details. |
|
|
|
|
| Teekay
Corporation |
| Appendix B
- Supplemental Financial Information |
| Summary
Statement of Loss for the Three Months Ended |
|
September 30, 2017 |
| (in
thousands of U.S. dollars) |
|
(unaudited) |
| |
|
|
|
|
|
|
|
| |
|
Teekay |
Teekay |
Teekay |
Teekay |
Consolidation |
Total |
| |
|
Offshore(1) |
LNG |
Tankers |
Parent |
Adjustments(2) |
|
| |
|
|
|
|
|
|
|
|
Revenues |
255,781 |
|
104,285 |
|
91,238 |
|
72,022 |
|
(22,545 |
) |
500,781 |
|
| |
|
|
|
|
|
— |
|
|
| Voyage
expenses |
(23,465 |
) |
(1,466 |
) |
(18,303 |
) |
(562 |
) |
1,342 |
|
(42,454 |
) |
| Vessel
operating expenses |
(81,110 |
) |
(26,724 |
) |
(40,958 |
) |
(51,774 |
) |
110 |
|
(200,456 |
) |
|
Time-charter hire expense |
(19,329 |
) |
— |
|
(5,835 |
) |
(21,968 |
) |
18,487 |
|
(28,645 |
) |
|
Depreciation and amortization |
(70,393 |
) |
(24,980 |
) |
(24,328 |
) |
(17,241 |
) |
— |
|
(136,942 |
) |
| General and
administrative expenses |
(18,403 |
) |
(2,793 |
) |
(7,622 |
) |
(1,450 |
) |
2,606 |
|
(27,662 |
) |
| Asset
impairments |
— |
|
(38,000 |
) |
— |
|
(205,659 |
) |
— |
|
(243,659 |
) |
| Net loss on
sale of vessels, equipment and |
|
|
|
|
|
|
| other operating assets |
— |
|
— |
|
(7,926 |
) |
— |
|
— |
|
(7,926 |
) |
|
Restructuring charges |
(2,697 |
) |
— |
|
— |
|
(186 |
) |
— |
|
(2,883 |
) |
| |
|
|
|
|
|
|
|
|
Income (loss) from vessel operations |
40,384 |
|
10,322 |
|
(13,734 |
) |
(226,818 |
) |
— |
|
(189,846 |
) |
| |
|
|
|
|
|
|
| Interest
expense |
(36,287 |
) |
(20,091 |
) |
(7,299 |
) |
(17,440 |
) |
6,618 |
|
(74,499 |
) |
| Interest
income |
664 |
|
602 |
|
305 |
|
6,947 |
|
(6,618 |
) |
1,900 |
|
| Realized
and unrealized (loss) gain |
— |
|
|
|
|
|
|
| on derivative instruments |
(606 |
) |
(2,178 |
) |
390 |
|
(3,734 |
) |
— |
|
(6,128 |
) |
| Equity
income (loss) |
4,128 |
|
1,417 |
|
(274 |
) |
(4,007 |
) |
— |
|
1,264 |
|
| Equity in
earnings of subsidiaries(3) |
— |
|
— |
|
— |
|
331,418 |
|
(331,418 |
) |
— |
|
| Income tax
expense |
(2,142 |
) |
(750 |
) |
(1,864 |
) |
(465 |
) |
— |
|
(5,221 |
) |
| Foreign
exchange (loss) gain |
(3,362 |
) |
(5,104 |
) |
81 |
|
5,743 |
|
— |
|
(2,642 |
) |
| Other
(loss) income - net |
(4,837 |
) |
356 |
|
15 |
|
(239 |
) |
— |
|
(4,705 |
) |
| Loss on deconsolidation of Teekay Offshore |
— |
|
— |
|
— |
|
(103,987 |
) |
799 |
|
(103,188 |
) |
| Net
loss |
(2,058 |
) |
(15,426 |
) |
(22,380 |
) |
(12,582 |
) |
(330,619 |
) |
(383,065 |
) |
| Less: Net
income attributable |
|
|
|
|
|
|
| to non-controlling interests(4) |
(2,351 |
) |
(3,470 |
) |
— |
|
— |
|
376,304 |
|
370,483 |
|
| Net
loss attributable to shareholders/ |
|
|
|
|
|
|
| unitholders of publicly-listed
entities |
(4,409 |
) |
(18,896 |
) |
(22,380 |
) |
(12,582 |
) |
45,685 |
|
(12,582 |
) |
|
|
|
(1) Teekay Offshore was consolidated by the Company for the
period up to September 25, 2017 and equity accounted for
thereafter. Teekay Offshore recorded in its full quarter results
for the third quarter of 2017 impairment charges of $316.7 million.
These impairment charges are not reflected in Teekay Offshore's
results in the table above as Teekay Offshore is consolidated only
up to September 25, 2017. However, the Company's
proportionate share of those impairment charges are effectively
included in Teekay Parent as part of the calculation of Loss on
deconsolidation of Teekay Offshore. |
|
(2) Consolidation Adjustments column includes adjustments
which eliminate transactions between subsidiaries (a) Teekay
Offshore, Teekay LNG and Teekay Tankers and (b) Teekay Parent. |
|
(3) Teekay Corporation’s proportionate share of the net
earnings of its publicly-traded subsidiaries. Refer to
footnote (6) of the summary consolidated statements of (loss)
income included in this release for further details. |
|
(4) Net income attributable to non-controlling interests in
the Teekay Offshore and Teekay LNG columns represents the joint
venture partners’ share of the net income or loss of their
respective joint ventures. Net income attributable to
non-controlling interest in the Consolidation Adjustments column
represents the public’s share of the net income of Teekay’s
publicly-traded subsidiaries. |
|
|
|
|
| Teekay
Corporation |
| Appendix C
- Supplemental Financial Information |
| Teekay
Parent Summary Operating Results |
| For the
Three Months Ended September 30, 2017 |
| (in
thousands of U.S. dollars) |
|
(unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Teekay |
|
|
Conventional |
|
|
Corporate |
Parent |
|
|
Tankers |
FPSOs(1) |
Other(2) |
G&A(3) |
Total |
|
|
|
|
|
|
|
|
Revenues |
1,041 |
|
51,254 |
|
19,727 |
|
— |
|
72,022 |
|
|
|
|
|
|
|
— |
|
| Voyage
expenses |
(92 |
) |
(9 |
) |
(461 |
) |
— |
|
(562 |
) |
| Vessel
operating expenses |
(1,457 |
) |
(40,438 |
) |
(9,879 |
) |
— |
|
(51,774 |
) |
|
Time-charter hire expense |
(2,423 |
) |
(7,714 |
) |
(11,831 |
) |
— |
|
(21,968 |
) |
|
Depreciation and amortization |
— |
|
(17,320 |
) |
79 |
|
— |
|
(17,241 |
) |
| General
and administrative expenses |
(146 |
) |
(4,071 |
) |
2,271 |
|
496 |
|
(1,450 |
) |
| Asset
impairments |
— |
|
(205,659 |
) |
— |
|
— |
|
(205,659 |
) |
|
Restructuring charges |
— |
|
— |
|
(186 |
) |
— |
|
(186 |
) |
| (Loss) income from vessel operations |
(3,077 |
) |
(223,957 |
) |
(280 |
) |
496 |
|
(226,818 |
) |
|
|
|
|
|
|
|
|
Reconciliation of (loss) income from vessel operations to
cash flow from vessel operations |
|
|
|
|
|
|
|
| (Loss)
income from vessel operations |
(3,077 |
) |
(223,957 |
) |
(280 |
) |
496 |
|
(226,818 |
) |
|
Depreciation and amortization |
— |
|
17,320 |
|
(79 |
) |
— |
|
17,241 |
|
| Asset
impairments |
— |
|
205,659 |
|
— |
|
— |
|
205,659 |
|
|
Amortization of in-process revenue |
|
|
|
|
— |
|
| contracts and other |
— |
|
(1,483 |
) |
(646 |
) |
— |
|
(2,129 |
) |
| Realized
gains from the |
|
|
|
|
— |
|
| settlements of non-designated |
|
|
|
|
— |
|
| derivative instruments |
— |
|
560 |
|
— |
|
— |
|
560 |
|
|
CFVO - Consolidated(4) |
(3,077 |
) |
(1,901 |
) |
(1,005 |
) |
496 |
|
(5,487 |
) |
| CFVO - Equity Investments(5) |
629 |
|
(990 |
) |
(1,025 |
) |
— |
|
(1,386 |
) |
| CFVO - Total |
(2,448 |
) |
(2,891 |
) |
(2,030 |
) |
496 |
|
(6,873 |
) |
|
|
|
(1) Includes recoveries from Teekay Offshore for business
development costs. |
|
(2) Includes the results of two chartered-in LNG carriers
owned by Teekay LNG and two chartered-in FSO units owned by Teekay
Offshore. |
|
(3) Includes recoveries from Teekay Offshore for legal
expenses. |
|
(4) In addition to the CFVO generated by its directly owned
and chartered-in assets, Teekay Parent also receives cash dividends
and distributions from its publicly-traded subsidiaries. For
the three months ended September 30, 2017, Teekay Parent
received cash distributions and dividends from these subsidiaries
totaling $6.7 million. The distributions and dividends received by
Teekay Parent include, among others, those made with respect to its
general partner interests in Teekay Offshore and Teekay LNG.
Please refer to Appendix D this release for further details. |
|
|
|
|
| Teekay
Corporation |
| Appendix D
- Reconciliation of Non-GAAP Financial Measures |
| Teekay
Parent Free Cash Flow |
| (in
thousands of U.S. dollars, except share and per share data) |
|
|
|
|
|
Three Months Ended |
|
|
|
September 30, |
June 30, |
March 31, |
December 31, |
September 30, |
| |
|
2017 |
2017 |
2017 |
2016 |
2016 |
| |
|
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
|
TEEKAY PARENT GPCO CASH FLOW |
|
|
|
|
|
|
Daughter Entities distributions |
|
|
|
|
|
|
|
to Teekay
Parent(1) |
|
|
|
|
|
| |
Limited
Partner interests(2) |
|
|
|
|
|
| |
Teekay
LNG |
3,529 |
|
3,529 |
|
3,529 |
|
3,529 |
|
3,529 |
|
| |
Teekay
Offshore |
566 |
|
444 |
|
4,624 |
|
4,465 |
|
4,305 |
|
| |
GP
interests |
|
|
|
|
|
| |
Teekay
LNG |
228 |
|
228 |
|
228 |
|
227 |
|
227 |
|
| |
Teekay
Offshore |
16 |
|
31 |
|
336 |
|
331 |
|
321 |
|
| |
Other
Dividends |
|
|
|
|
|
| |
Teekay
Tankers(2)(3) |
1,690 |
|
1,690 |
|
1,276 |
|
1,276 |
|
1,212 |
|
| |
Teekay Offshore(4) |
637 |
|
683 |
|
683 |
|
683 |
|
683 |
|
| Total
Daughter Entity Distributions |
6,666 |
|
6,605 |
|
10,676 |
|
10,511 |
|
10,277 |
|
| Less: |
|
|
|
|
|
| |
Corporate
general and |
|
|
|
|
|
| |
administrative expenses(5) |
496 |
|
(3,318 |
) |
(5,956 |
) |
(6,759 |
) |
(3,907 |
) |
| Total Parent GPCO Cash Flow |
7,162 |
|
3,287 |
|
4,720 |
|
3,752 |
|
6,370 |
|
|
TEEKAY PARENT OPCO CASH FLOW |
|
|
|
|
|
|
Teekay Parent cash flow from |
|
|
|
|
|
| |
vessel
operations(6) |
|
|
|
|
|
| |
Conventional Tankers |
(3,077 |
) |
(2,988 |
) |
(2,459 |
) |
(2,372 |
) |
(363 |
) |
| |
FPSOs(7) |
(1,901 |
) |
(3,089 |
) |
(4,830 |
) |
6,522 |
|
2,295 |
|
| |
Other(8) |
(1,005 |
) |
(3,997 |
) |
(6,040 |
) |
134 |
|
(1,818 |
) |
|
Total(9) |
(5,983 |
) |
(10,074 |
) |
(13,329 |
) |
4,284 |
|
114 |
|
| Less:
Net interest expense(10) |
(13,072 |
) |
(12,780 |
) |
(12,362 |
) |
(12,314 |
) |
(13,258 |
) |
| Teekay Parent OPCO Cash Flow |
(19,055 |
) |
(22,854 |
) |
(25,691 |
) |
(8,030 |
) |
(13,144 |
) |
|
TOTAL TEEKAY PARENT FREE |
|
|
|
|
|
| |
CASH FLOW |
(11,893 |
) |
(19,567 |
) |
(20,971 |
) |
(4,278 |
) |
(6,774 |
) |
|
Weighted-average number of |
|
|
|
|
|
| |
common shares - Basic |
86,261,330 |
|
86,259,207 |
|
86,183,831 |
|
86,131,038 |
|
84,887,101 |
|
|
|
|
(1) Daughter Entity dividends and distributions for a given
quarter consists of the amount of dividends and distributions
(including payments in kind) relating to such quarter but received
by Teekay Parent in the following quarter. The limited
partner and general partner distributions received from Teekay
Offshore for the quarters ended September 30, 2017, June 30, 2017,
March 31, 2017, December 31, 2016, and September 30, 2016 were
paid-in-kind in the form of new Teekay Offshore common units. |
|
(2) Common share/unit dividend/distribution cash flows to
Teekay Parent are based on Teekay Parent’s ownership on the
ex-dividend date for the respective publicly-traded subsidiary and
period as follows: |
|
|
|
|
|
Three Months Ended |
|
|
|
|
September 30, |
June 30, |
March 31, |
December 31, |
September 30 |
|
|
|
2017 |
2017 |
2017 |
2016 |
2016 |
|
|
|
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
| Teekay
LNG |
|
|
|
|
|
|
|
|
|
|
|
|
Distribution per common unit |
$ |
0.14 |
|
$ |
0.14 |
|
$ |
0.14 |
|
$ |
0.14 |
|
$ |
0.14 |
|
|
| Common
units owned by |
|
|
|
|
|
|
|
|
|
|
|
|
Teekay Parent |
|
25,208,274 |
|
|
25,208,274 |
|
|
25,208,274 |
|
|
25,208,274 |
|
|
25,208,274 |
|
|
| Total
distribution |
$ |
3,529,158 |
|
$ |
3,529,158 |
|
$ |
3,529,158 |
|
$ |
3,529,158 |
|
$ |
3,529,158 |
|
|
| Teekay
Offshore |
|
|
|
|
|
|
|
|
|
|
|
|
Distribution per common unit |
$ |
0.01 |
|
$ |
0.01 |
|
$ |
0.11 |
|
$ |
0.11 |
|
$ |
0.11 |
|
|
| Common
units owned by |
|
|
|
|
|
|
|
|
|
|
|
|
Teekay Parent |
|
56,587,484 |
|
|
44,400,566 |
|
|
42,037,728 |
|
|
40,589,218 |
|
|
39,138,991 |
|
|
| Total
distribution |
$ |
565,875 |
|
$ |
444,006 |
|
$ |
4,624,150 |
|
$ |
4,464,814 |
|
$ |
4,305,289 |
|
|
| Teekay
Tankers |
|
|
|
|
|
|
|
|
|
|
|
| Dividend
per share |
$ |
0.03 |
|
$ |
0.03 |
|
$ |
0.03 |
|
$ |
0.03 |
|
$ |
0.03 |
|
|
|
Shares owned by Teekay Parent(3) |
|
56,317,627 |
|
|
56,317,627 |
|
|
42,542,403 |
|
|
42,542,403 |
|
|
40,387,231 |
|
|
| Total
dividend |
$ |
1,689,529 |
|
$ |
1,689,529 |
|
$ |
1,276,272 |
|
$ |
1,276,272 |
|
$ |
1,211,617 |
|
|
|
|
|
(3) Includes Class A and Class B shareholdings. Teekay
Tankers' current dividend policy is to pay out 30 percent to 50
percent of its quarterly adjusted net income (as defined) with a
minimum quarterly dividend of $0.03 per share. |
|
(4) Includes distributions from Teekay Parent's interest in
Teekay Offshore's 10.5% Series D Preferred Units acquired in June
2016. The distribution received for the quarters ended June
30, 2017, March 31, 2017, December 31, 2016 and September 30, 2016
were paid-in-kind in the form of new Teekay Offshore common
units. All outstanding Series D Preferred Units were
repurchased by Teekay Offshore in September 2017 as part of the
Brookfield Transaction. |
| (5)
Includes recoveries from Teekay Offshore for legal expenses for the
three months ended September 30, 2017. Includes a one-time
compensation cost associated with the retirement of Teekay
Corporation's Chief Executive Officer for the three months ended
December 31, 2016. |
|
(6) Please refer to Appendices C and E for additional
financial information on Teekay Parent’s cash flow from vessel
operations. |
|
(7) Includes recoveries from Teekay Offshore for business
development costs for the three months ended September 30,
2017. |
|
(8) Includes $0.4 million, $0.9 million, $2.2 million, $0.3
million, and $1.1 million for the three months ended June 30, 2017,
March 31, 2017, December 31, 2016, and September 30, 2016,
respectively, relating to 50 percent of the CFVO from TTOL. Teekay
Parent owned 50 percent of TTOL for the period up to May 31, 2017,
when Teekay Tankers purchased the remaining 50 percent of TTOL from
Teekay Parent. |
|
(9) Excludes corporate general and administrative expenses
relating to Teekay Parent GPCO Cash Flow. |
|
(10) Please see Appendix E to this release for a description
of this measure and a reconciliation of this non-GAAP financial
measure as used in this release to interest expense net of interest
income, the most directly comparable GAAP financial measure. |
|
|
|
|
| Teekay
Corporation |
| Appendix E
- Reconciliation of Non-GAAP Financial Measures |
| Cash Flow
from Vessel Operations - Consolidated |
| (in
thousands of U.S. dollars) |
|
|
| |
|
Three Months Ended |
| |
|
September 30, |
June 30, |
September 30, |
| |
|
2017 |
2017 |
2016 |
| |
(unaudited) |
(unaudited) |
(unaudited) |
| (Loss)
income from vessel operations |
(189,846 |
) |
48,286 |
|
89,765 |
|
|
Depreciation and amortization |
136,942 |
|
142,741 |
|
141,688 |
|
|
Amortization of in-process revenue contracts and other |
(6,737 |
) |
(6,241 |
) |
(5,921 |
) |
| Realized
gains (losses) from the settlements of non-designated |
|
|
|
| derivative instruments |
1,843 |
|
(177 |
) |
(1,364 |
) |
| Asset
impairments |
243,659 |
|
1,500 |
|
7,766 |
|
| Net loss on
sale of vessels, equipment and other operating assets |
7,926 |
|
12,742 |
|
72 |
|
| Termination
of Arendal Spirit UMS charter contract |
— |
|
8,888 |
|
— |
|
| Cash flow
from time-charter contracts, net of revenue accounted for |
|
|
|
| as direct finance leases |
3,071 |
|
6,509 |
|
6,809 |
|
|
CFVO - Consolidated |
196,858 |
|
214,248 |
|
238,815 |
|
| CFVO - Equity Investments (see Appendix
E) |
41,202 |
|
40,248 |
|
46,699 |
|
| CFVO - Total |
238,060 |
|
254,496 |
|
285,514 |
|
| |
|
|
|
|
|
|
|
|
| Teekay
Corporation |
| Appendix E
- Reconciliation of Non-GAAP Financial Measures |
| Cash Flow
from Vessel Operations - Equity Accounted Vessels |
| (in
thousands of U.S. dollars) |
|
|
| |
|
Three Months Ended |
| |
|
September 30, 2017 |
June 30, 2017 |
September 30, 2016 |
| |
|
(unaudited) |
(unaudited) |
(unaudited) |
| |
|
At |
Company's |
At |
Company's |
At |
Company's |
| |
|
100% |
Portion(1) |
100% |
Portion |
100%(2) |
Portion(2) |
| |
|
|
|
|
|
|
|
|
Revenues |
196,281 |
|
78,912 |
|
176,125 |
|
74,082 |
|
194,068 |
|
81,764 |
|
| Vessel and
other operating expenses |
(101,063 |
) |
(40,279 |
) |
(86,424 |
) |
(36,077 |
) |
(89,084 |
) |
(37,143 |
) |
| Depreciation and amortization |
(48,045 |
) |
(19,425 |
) |
(40,199 |
) |
(17,428 |
) |
(39,982 |
) |
(17,288 |
) |
| Income from
vessel operations of |
|
|
|
|
|
|
| equity accounted vessels |
47,173 |
|
19,208 |
|
49,502 |
|
20,577 |
|
65,002 |
|
27,333 |
|
| Interest
expense |
(36,568 |
) |
(14,878 |
) |
(29,607 |
) |
(12,383 |
) |
(26,604 |
) |
(11,278 |
) |
| Realized
and unrealized (loss) gain on |
|
|
|
|
|
|
| derivative instruments |
(21,538 |
) |
(3,652 |
) |
(20,957 |
) |
(6,647 |
) |
9,401 |
|
3,481 |
|
| Write-down
of other assets(3) |
— |
|
— |
|
— |
|
(48,571 |
) |
— |
|
— |
|
| Other - net |
(1,716 |
) |
586 |
|
(1,284 |
) |
(960 |
) |
3,663 |
|
1,544 |
|
| Net (loss) income of equity accounted
vessels |
(12,649 |
) |
1,264 |
|
(2,346 |
) |
(47,984 |
) |
51,462 |
|
21,080 |
|
| Income from
vessel operations of |
|
|
|
|
|
|
| equity accounted vessels |
47,173 |
|
19,208 |
|
49,502 |
|
20,577 |
|
65,002 |
|
27,333 |
|
|
Depreciation and amortization |
43,134 |
|
19,425 |
|
40,199 |
|
17,428 |
|
39,982 |
|
17,288 |
|
| Cash flow
from time-charter contracts, |
|
|
|
|
|
|
| net of revenue accounted for as |
|
|
|
|
|
|
| direct finance lease |
10,017 |
|
3,636 |
|
9,476 |
|
3,361 |
|
9,333 |
|
3,388 |
|
|
Amortization of in-process |
|
|
|
|
|
|
| revenue contracts and other |
(2,065 |
) |
(1,067 |
) |
(2,541 |
) |
(1,118 |
) |
(2,553 |
) |
(1,310 |
) |
|
Cash flow from vessel operations |
|
|
|
|
|
|
| of equity accounted vessels(4) |
98,259 |
|
41,202 |
|
96,636 |
|
40,248 |
|
111,764 |
|
46,699 |
|
|
|
|
(1) The Company’s proportionate share of its equity accounted
vessels and other investments, including its investment in Teekay
Offshore, ranges from 14 percent to 52 percent. |
|
(2) On May 31, 2017, Teekay Tankers acquired from Teekay
Parent, the remaining 50% interest in TTOL. As a result of the
acquisition, the financial information for Teekay Tankers prior to
the date that Teekay Tankers acquired interests in TTOL are
retroactively adjusted to include the results of TTOL during the
periods they were under common control of Teekay and had begun
operations. As a result, TTOL's results are no longer included in
this table. |
|
(3) Refer to footnote (4) of the summary consolidated
statements of (loss) income included in this release for further
details. |
|
(4) CFVO from equity accounted vessels represents the
Company’s proportionate share of CFVO from its equity accounted
vessels and other investments. |
|
|
|
|
| Teekay
Corporation |
| Appendix E
- Reconciliation of Non-GAAP Financial Measures |
| Cash Flow
from Vessel Operations - Teekay Parent |
| (in
thousands of U.S. dollars) |
|
|
| |
|
Three Months Ended June 30, 2017 |
| |
|
(unaudited) |
| |
|
|
|
|
|
Teekay |
| |
|
Conventional |
|
|
Corporate |
Parent |
| |
|
Tankers |
FPSOs |
Other |
G&A |
Total |
| |
|
|
|
|
|
|
|
|
|
| Teekay
Parent loss from |
|
|
|
|
|
|
|
|
| vessel operations |
(2,988 |
) |
|
(18,618 |
) |
|
(4,466 |
) |
(3,318 |
) |
|
(29,390 |
) |
|
Depreciation and amortization |
— |
|
|
17,320 |
|
|
(75 |
) |
— |
|
|
17,245 |
|
|
Amortization of in-process |
|
|
|
|
|
|
|
|
| revenue contracts and other |
— |
|
|
(1,483 |
) |
|
135 |
|
— |
|
|
(1,348 |
) |
| Realized
losses from the |
|
|
|
|
|
|
|
|
| settlements of non-designated |
|
|
|
|
|
|
|
|
| foreign currency derivative |
|
|
|
|
|
|
|
|
| instruments |
— |
|
|
(308 |
) |
|
— |
|
— |
|
|
(308 |
) |
|
Cash flow from vessel |
|
|
|
|
|
|
|
|
| operations - Teekay Parent |
(2,988 |
) |
|
(3,089 |
) |
|
(4,406 |
) |
(3,318 |
) |
|
(13,801 |
) |
| |
|
|
| |
|
Three Months Ended March 31,
2017 |
| |
|
(unaudited) |
| |
|
|
|
|
|
Teekay |
| |
|
Conventional |
|
|
Corporate |
Parent |
| |
|
Tankers |
FPSOs |
Other |
G&A |
Total |
| |
|
|
|
|
|
|
|
|
|
| Teekay
Parent loss from |
|
|
|
|
|
|
|
|
| vessel operations |
(2,459 |
) |
|
(20,411 |
) |
|
(6,846 |
) |
(5,956 |
) |
|
(35,672 |
) |
|
Depreciation and amortization |
— |
|
|
17,319 |
|
|
(44 |
) |
— |
|
|
17,275 |
|
|
Amortization of in-process |
|
|
|
|
|
|
|
|
| revenue contracts and other |
— |
|
|
(1,484 |
) |
|
(15 |
) |
— |
|
|
(1,499 |
) |
| Realized
losses from the |
|
|
|
|
|
|
|
|
| settlements of non-designated |
|
|
|
|
|
|
|
|
| foreign currency derivative |
|
|
|
|
|
|
|
|
| instruments |
— |
|
|
(254 |
) |
|
— |
|
— |
|
|
(254 |
) |
|
Cash flow from vessel |
|
|
|
|
|
|
|
|
| operations - Teekay Parent |
(2,459 |
) |
|
(4,830 |
) |
|
(6,905 |
) |
(5,956 |
) |
|
(20,150 |
) |
| |
|
|
| |
|
Three Months Ended December 31,
2016 |
| |
|
(unaudited) |
| |
|
|
|
|
|
Teekay |
| |
|
Conventional |
|
|
Corporate |
Parent |
| |
|
Tankers |
FPSOs |
Other |
G&A |
Total |
| |
|
|
|
|
|
|
|
|
|
| Teekay
Parent loss from |
|
|
|
|
|
|
|
|
| vessel operations |
(2,323 |
) |
|
(9,151 |
) |
|
(3,297 |
) |
(6,759 |
) |
|
(21,530 |
) |
|
Depreciation and amortization |
— |
|
|
17,546 |
|
|
(112 |
) |
— |
|
|
17,434 |
|
| (Gain) loss
on sale of vessels and equipment |
(49 |
) |
|
110 |
|
|
— |
|
— |
|
|
61 |
|
|
Amortization of in-process |
|
|
|
|
|
|
|
|
| revenue contracts and other |
— |
|
|
(1,483 |
) |
|
1,274 |
|
— |
|
|
(209 |
) |
| Realized
losses from the |
|
|
|
|
|
|
|
|
| settlements of non-designated |
|
|
|
|
|
|
|
|
| foreign currency derivative |
|
|
|
|
|
|
|
|
| instruments |
— |
|
|
(500 |
) |
|
— |
|
— |
|
|
(500 |
) |
|
Cash flow from vessel |
|
|
|
|
|
|
|
|
| operations - Teekay Parent |
(2,372 |
) |
|
6,522 |
|
|
(2,135 |
) |
(6,759 |
) |
|
(4,744 |
) |
| |
|
|
| |
|
Three Months Ended September 30,
2016 |
| |
|
(unaudited) |
| |
|
|
|
|
|
Teekay |
| |
|
Conventional |
|
|
Corporate |
Parent |
| |
|
Tankers |
FPSOs |
Other |
G&A |
Total |
| |
|
|
|
|
|
|
|
|
|
| Teekay
Parent loss from |
|
|
|
|
|
|
|
|
| vessel operations |
(363 |
) |
|
(13,116 |
) |
|
(2,002 |
) |
(3,907 |
) |
|
(19,388 |
) |
|
Depreciation and amortization |
— |
|
|
17,713 |
|
|
(113 |
) |
— |
|
|
17,600 |
|
|
Amortization of in-process |
|
|
|
|
|
|
|
|
| revenue contracts and other |
— |
|
|
(1,483 |
) |
|
10 |
|
— |
|
|
(1,473 |
) |
| Realized
losses from the |
|
|
|
|
|
|
|
|
| settlements of non-designated |
|
|
|
|
|
|
|
|
| foreign currency derivative |
|
|
|
|
|
|
|
|
| instruments |
— |
|
|
(819 |
) |
|
— |
|
— |
|
|
(819 |
) |
|
Cash flow from vessel |
|
|
|
|
|
|
|
|
| operations - Teekay Parent |
(363 |
) |
|
2,295 |
|
|
(2,105 |
) |
(3,907 |
) |
|
(4,080 |
) |
|
|
|
|
| Teekay
Corporation |
| Appendix E
- Reconciliation of Non-GAAP Financial Measures |
| Net
Interest Expense - Teekay Parent |
| (in
thousands of U.S. dollars) |
|
|
| |
|
|
Three Months Ended |
|
| |
|
|
September 30, |
June 30, |
March 31, |
December 31, |
September 30, |
|
| |
|
|
2017 |
2017 |
2017 |
2016 |
2016 |
|
| |
|
|
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
|
| Interest
expense |
(74,499 |
) |
(74,383 |
) |
(70,355 |
) |
(69,018 |
) |
(68,490 |
) |
|
| Interest income |
1,900 |
|
1,536 |
|
1,481 |
|
1,314 |
|
1,143 |
|
|
| Interest
expense net of interest income - consolidated |
(72,599 |
) |
(72,847 |
) |
(68,874 |
) |
(67,704 |
) |
(67,347 |
) |
|
| Less: |
|
|
|
|
|
|
| Non-Teekay Parent interest expense net of interest
income and adjustment |
(60,201 |
) |
(60,777 |
) |
(57,282 |
) |
(56,227 |
) |
(55,035 |
) |
|
| Interest
expense net of interest income - Teekay Parent |
(12,398 |
) |
(12,070 |
) |
(11,592 |
) |
(11,477 |
) |
(12,312 |
) |
|
| Add: |
|
|
|
|
|
|
| Teekay Parent realized losses on interest rate
swaps |
(674 |
) |
(710 |
) |
(770 |
) |
(837 |
) |
(946 |
) |
|
| Net interest expense - Teekay
Parent |
(13,072 |
) |
(12,780 |
) |
(12,362 |
) |
(12,314 |
) |
(13,258 |
) |
|
|
|
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 effects
of, and ability of Teekay and the Daughter Entities to execute on,
strategic transactions, vessel deliveries and financing initiatives
on each of the Company’s businesses; future cash flows from growth
projects; the effect of Centrica’s drilling campaign on future
production, including the effect of future production and oil
prices on Teekay Parent’s cash flows from the Hummingbird Spirit
FPSO unit; potential recoveries in the LNG, offshore and crude oil
tanker markets; the ability of the Company’s businesses to benefit
from and take advantage of the recovery of such markets; increases
in tanker ton-mile demand; the effect of charter-in contract
terminations on Teekay Parent’s future cash flows; the outcome of
the class action lawsuit against Teekay; the timing and cost of
delivery and start-up of various newbuildings and
conversion/upgrade projects and the commencement of related
contracts; the contract terms related to the extension of the
employment of the Voyageur Spirit FPSO unit on the Huntington field
and the expected impact on the life of the Huntington field; the
Rio das Ostras FPSO redeployment; the timing and completion of
Teekay Tankers’ merger with TIL; Huber Capital’s expected vote in
relation to Teekay Tankers’ merger with TIL; the expected
repurchase of Teekay Offshore’s existing NOK bonds due to mature in
late-2018; the expected delivery of an Aframax tanker in November
2017; and the potential for repurchases by Teekay Tankers of its
common shares under its share repurchase program. 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: failure to satisfy the closing conditions of Teekay
Tankers’ merger with TIL, including, without limitation, approval
of TIL’s shareholders of the merger and of Teekay Tankers’
shareholders of an amendment to its charter required to permit
Teekay Tankers to issue the share merger consideration; changes in
exploration, production and storage of offshore oil and gas, either
generally or in particular regions that would affect expected
future growth; changes in the demand for oil, refined
products, LNG or LPG; changes in trading patterns significantly
affecting overall vessel tonnage requirements; greater or less than
anticipated levels of vessel newbuilding orders and deliveries and
greater or less than anticipated rates of vessel scrapping; changes
in global oil prices; issues with vessel operations; variations in
expected levels of field maintenance; increased operating expenses;
potential project delays or cancellations; vessel conversion and
upgrade delays, newbuilding or conversion specification changes,
cost overruns, or shipyard disputes; 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; delays in the commencement of
charter or other contracts; the ability to fund remaining capital
commitments and debt maturities; the inability to negotiate
acceptable terms and final documentation for the Voyageur Spirit
FPSO contract extension; the ability of the Partnership to secure
redeployment opportunities for the Rio das Ostras FPSO; and other
factors discussed in Teekay’s filings from time to time with the
SEC, including its Report on Form 20-F for the fiscal year ended
December 31, 2016. Teekay 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 Teekay’s expectations with respect thereto or any change in
events, conditions or circumstances on which any such statement is
based.
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