Teekay Corporation Reports First Quarter 2015 Results
HAMILTON, BERMUDA -- (Marketwired) -- 05/14/15 -- Teekay Corporation (NYSE: TK) -
Highlights
-- First quarter 2015 total consolidated cash flow from vessel
operations(1) of $320.9 million, an increase of 21 percent from the same
period of the prior year.
-- First quarter 2015 adjusted net income attributable to shareholders(2)
of $15.7 million, or $0.22 per share, compared to $3.5 million, or $0.05
per share, in the same period of the prior year.
-- First quarter 2015 Teekay Parent free cash flow(3) of $31.5 million, or
$0.43 per share, compared to $21.1 million, or $0.30 per share, in the
same period of the prior year.
-- Knarr FPSO unit achieved first oil in mid-March 2015 and commenced its
charter contract at partial rate; the sale of the Knarr FPSO to Teekay
Offshore is expected to be completed in the second quarter of 2015.
-- Teekay expects to implement its new dividend policy in the second
quarter of 2015, with an initial increase of approximately 75 percent to
$0.55 per share, or $2.20 per share annualized.
-- Consolidated liquidity of approximately $1.2 billion as at March 31,
2015, giving pro-forma effect to Teekay Offshore's preferred unit
offering completed in April 2015 and Teekay LNG's Norwegian bond
offering completed in May 2015.
Teekay Corporation (Teekay or the Company) (NYSE: TK) today reported adjusted net income attributable to shareholders(2) of $15.7 million, or $0.22 per share, compared to $3.5 million, or $0.05 per share, for the quarters ended March 31, 2015 and 2014, respectively. Adjusted net income attributable to shareholders excludes a number of specific items that had the net effect of increasing the GAAP net loss by $25.5 million, or $0.35 per share, and $4.0 million, or $0.06 per share, for the quarters ended March 31, 2015 and 2014, respectively, as detailed in Appendix A to this release. Including these items, the Company reported, on a GAAP basis, a net loss attributable to shareholders of $9.8 million, or $0.13 per share, compared to $0.5 million, or $0.01 per share, for the quarters ended March 31, 2015 and 2014, respectively. Net revenues(4) for the first quarter of 2015 increased to $520.2 million, compared to $471.5 million for the same period of the prior year.
On April 2, 2015, the Company declared a cash dividend on its common stock of $0.31625 per share for the quarter ended March 31, 2015. The cash dividend was paid on April 30, 2015 to all shareholders of record on April 17, 2015.
"Teekay Parent's strong free cash flow in the first quarter was largely due to the expected Banff FPSO contract rate step-up effective January 1, 2015 and the Knarr FPSO achieving first oil and commencing its charter contract at partial rate with BG in mid-March 2015, which is expected to increase further with a higher contribution from the Knarr FPSO in the second quarter of 2015," commented Peter Evensen, Teekay Corporation's President and Chief Executive Officer. "Our daughter entities also reported strong results during the quarter with Teekay Offshore and Teekay LNG both posting strong cash flows and distribution coverage and Teekay Tankers achieving the strongest cash flows in the last six years."
"We have continued to make steady progress on the Knarr FPSO commissioning process, including successfully discharging the FPSO's first cargo to one of Teekay Offshore's shuttle tankers, and are now in the final phase towards reaching full charter rate," Mr. Evensen continued. "Subject to the unit completing certain operational tests and commencement of the full charter rate, we expect to complete the sale of the Knarr FPSO to Teekay Offshore in the second quarter of 2015."
Mr. Evensen added, "We expect to implement the new Teekay Parent dividend policy in the second quarter of 2015 with an initial quarterly dividend increase of approximately 75 percent to $0.55 per share, or $2.20 per share annualized, payable in July 2015, with future increases linked to the growth in the dividend cash flows we receive from our daughter entities. With a robust project pipeline of approximately $6.7 billion of committed growth projects at Teekay Offshore and Teekay LNG and with both partnerships continuing to pursue new growth opportunities, Teekay Parent is expected to achieve strong future free cash flow and dividend growth."
(1) Cash flow from vessel operations is a non-GAAP financial measure used by certain investors to measure the financial performance of shipping companies. Please see Appendix C and Appendix E to this release for a reconciliation of this non-GAAP measure as used in this release to the most directly comparable financial measure under United States generally accepted accounting principles (GAAP).
(2) Adjusted net income attributable to shareholders of Teekay is a non-GAAP financial measure. Please refer to Appendix A to this release for a reconciliation of this non-GAAP measure as used in this release to the most directly comparable financial measure under GAAP and for information about specific items affecting net loss that are typically excluded by securities analysts in their published estimates of the Company's financial results.
(3) Teekay Parent free cash flow is a non-GAAP financial measure used by certain investors to measure the financial performance of companies. Please refer to Appendix D to this release for a reconciliation of this non-GAAP measure as used in this release to the most directly comparable financial measure under GAAP.
(4) Net revenues is a non-GAAP financial measure used by certain investors to measure the financial performance of shipping companies. Please see Appendix E to this release for a reconciliation of this non-GAAP measure as used in this release to the most directly comparable financial measure under GAAP.
Operating Results
The following tables highlight certain financial information for each of Teekay's four publicly-listed entities: Teekay Offshore Partners L.P. (Teekay Offshore) (NYSE: TOO), Teekay LNG Partners L.P. (Teekay LNG) (NYSE: TGP), Teekay Tankers Ltd. (Teekay Tankers) (NYSE: TNK) and Teekay Parent (which excludes the results attributed to Teekay Offshore, Teekay LNG and Teekay Tankers). A brief description of each entity and an analysis of its respective financial results follow the tables below. Please also refer to the "Fleet List" section below and Appendix B to this release for further details.
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Three Months Ended March 31, 2015
(unaudited)
Teekay Teekay Teekay
(in thousands of U.S. dollars) Offshore LNG Tankers
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Net revenues(1) 228,394 97,008 100,044
Vessel operating expense (74,034) (21,634) (22,441)
Time-charter hire expense (6,983) - (15,003)
Depreciation and amortization (53,604) (23,569) (13,672)
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CFVO - Consolidated(2)(3)(4) 127,807 72,705 53,976
CFVO - Equity Investments(5) 8,854 46,304 4,176
CFVO - Total 136,661 119,009 58,152
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Three Months Ended March 31, 2014
(unaudited)
Teekay Teekay Teekay
(in thousands of U.S. dollars) Offshore LNG Tankers
Net revenues(1) 225,780 100,157 60,320
Vessel operating expense (88,130) (24,256) (22,794)
Time-charter hire expense (11,412) - (1,052)
Depreciation and amortization (48,488) (24,110) (12,502)
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CFVO - Consolidated(2)(3)(4) 108,149 71,434 33,282
CFVO - Equity Investments(5) 7,947 48,140 1,423
CFVO - Total 116,096 119,574 34,705
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Three Months Ended March 31, 2015
(unaudited)
Teekay
Teekay Consolidation Corporation
(in thousands of U.S. dollars) Parent Adjustments Consolidated
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Net revenues(1) 118,151 (23,405) 520,192
Vessel operating expense (66,094) - (184,203)
Time-charter hire expense (28,827) 25,886 (24,927)
Depreciation and amortization (21,859) - (112,704)
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CFVO - Consolidated(2)(3)(4) 3,807 (27) 258,268
CFVO - Equity Investments(5) 3,226 27 62,587
CFVO - Total 7,033 - 320,855
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Three Months Ended March 31, 2014
(unaudited)
Teekay
Teekay Consolidation Corporation
(in thousands of U.S. dollars) Parent Adjustments Consolidated
Net revenues(1) 111,749 (26,524) 471,482
Vessel operating expense (66,006) - (201,186)
Time-charter hire expense (31,276) 27,448 (16,292)
Depreciation and amortization (18,358) - (103,458)
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CFVO - Consolidated(2)(3)(4) (5,486) - 207,379
CFVO - Equity Investments(5) 141 - 57,651
CFVO - Total (5,345) - 265,030
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(1) Net revenues represents revenues less voyage expenses, which comprise
all expenses relating to certain voyages, including bunker fuel expenses,
port fees, cargo loading and unloading expenses, canal tolls, agency fees
and commissions. Net revenues is a non-GAAP financial measure used by
certain investors to measure the financial performance of shipping
companies. Please see Appendix E for a reconciliation of this non-GAAP
measure as used in this release to the most directly comparable GAAP
financial measure.
(2) Cash flow from vessel operations (CFVO) represents income from vessel
operations before depreciation and amortization expense, amortization of in-
process revenue contracts, vessel write-downs, gains or losses on the sale
of vessels 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 is a non-GAAP financial measure used by certain
investors to measure the financial performance of shipping companies. Please
refer to Appendix C and Appendix E of this release for a reconciliation of
this non-GAAP measure as used in this release to the most directly
comparable GAAP financial measure.
(3) Excludes CFVO relating to assets acquired from Teekay Parent for the
periods prior to their acquisition by Teekay Offshore, Teekay LNG and Teekay
Tankers, respectively, as those results are included in the historical
results for Teekay Parent.
(4) In addition to CFVO from directly owned vessels, Teekay Parent also
receives cash dividends and distributions from its daughter public
companies. For the three months ended March 31, 2015 and 2014, Teekay Parent
received dividends and distributions from Teekay LNG, Teekay Offshore and
Teekay Tankers totaling $45.3 million and $43.3 million, respectively. The
dividends and distributions 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 to this release for further
details.
(5) CFVO - Equity Investments represents the Company's proportionate share
of CFVO from its equity-accounted vessels and other investments. Please
refer to Appendix E of this release for a reconciliation of this non-GAAP
measure as used in this release to the most directly comparable GAAP
financial measure.
Teekay Offshore Partners L.P.
Teekay Offshore is an international provider of marine transportation, oil production, storage, long-distance towing and offshore installation and maintenance and safety services to the offshore oil industry through its fleet of 63 offshore assets, including shuttle tankers, floating production, storage and offloading (FPSO) units, floating storage and offtake (FSO) units, units for maintenance and safety (UMS), long-distance towing and offshore installation vessels and conventional tankers. Teekay Offshore's interests in these vessels range from 50 to 100 percent. Teekay Offshore also has the right to participate in certain other FPSO and vessel opportunities pursuant to the omnibus agreement with Teekay. Teekay Parent currently owns a 27.3 percent interest in Teekay Offshore (including the 2 percent sole general partner interest).
For the first quarter of 2015, Teekay Offshore's quarterly distribution was $0.5384 per common unit. The cash distribution to be received by Teekay Parent based on its common unit ownership and general partnership interest in Teekay Offshore totaled $18.1 million for the first quarter of 2015, as detailed in Appendix D to this release.
Cash flow from vessel operations from Teekay Offshore increased to $136.7 million in the first quarter of 2015, from $116.1 million in the same period of the prior year, primarily due to the acquisition of three long-distance towing and offshore installation vessels during the first quarter of 2015, the delivery of the Suksan Salamander FSO unit in August 2014, an increase in the charter rate for the Cidade de Rio das Ostras FPSO unit and an overall decrease in operating expenses. These increases were partially offset by lower shuttle tanker revenues as a result of the sale of the Navion Norvegia in October 2014 to a 50 percent-owned Teekay Offshore joint venture company for conversion into an FPSO unit, and the sale of the 1997-built Navion Svenita in March 2015 to a third party.
In 2015 to-date, Teekay Offshore, through its wholly-owned subsidiary ALP Maritime Services B.V. (ALP), has acquired four of the six modern on-the-water long-distance towing and offshore installation vessels which ALP agreed to acquire in October 2014 for approximately $220 million. ALP expects to take delivery of the remaining two vessels during the second quarter of 2015. Including these vessels and ALP's four state-of-the-art long-distance towing and offshore installation newbuildings scheduled to deliver in 2016, ALP will become the world's largest owner and operator of dynamic positioning towing and offshore installation vessels. All ten vessels will be capable of long-distance towing and offshore unit installation and decommissioning of large floating exploration, production and storage units, including FPSO units, floating liquefied natural gas (FLNG) units and floating drill rigs.
In August 2014, Teekay Offshore took delivery of its first UMS, the Arendal Spirit, which has now arrived in Brazil and is expected to commence its three-year fixed-rate time-charter contract, plus extension options, with Petrobras in June 2015. Teekay Offshore has the option to defer the delivery of the remaining two UMS newbuildings by up to one year. Teekay Offshore intends to secure charter contracts for these two UMS newbuildings prior to their scheduled deliveries.
In early-May 2015, Teekay Offshore was awarded a two-year shuttle tanker contract of affreightment (CoA) with EnQuest PLC., which will service the Alma Galia field in the North Sea. The CoA is expected to start-up in July 2015 with the requirement for up to 15 roundtrip voyages per year.
Teekay LNG Partners L.P.
Teekay LNG provides liquefied natural gas (LNG), liquefied petroleum gas (LPG) and crude oil marine transportation services, generally under long-term, fixed-rate charter contracts, through its interests in 86 liquefied gas and conventional tanker assets, including LNG carriers, LPG carriers and conventional tankers. Teekay LNG's interests in these vessels range from 20 to 100 percent. Teekay Parent currently owns a 33.5 percent interest in Teekay LNG (including the 2 percent sole general partner interest).
For the first quarter of 2015, Teekay LNG's quarterly distribution was $0.70 per common unit. The cash distribution to be received by Teekay Parent based on its common unit ownership and general partnership interest in Teekay LNG totaled $26.3 million for the first quarter of 2015, as detailed in Appendix D to this release.
Teekay LNG's total cash flow from vessel operations, including cash flows from equity accounted vessels, was $119.0 million in the first quarter of 2015, compared to $119.6 million in the same period of the prior year. The slight decrease was primarily due to the sale of two 2000- and 2001-built conventional tankers and four older Exmar LPG BVBA (Exmar LPG) owned LPG carriers in 2014, a grounding incident and related disputed off-hire for the 52 percent-owned Magellan Spirit LNG carrier during the first quarter of 2015 and the scheduled expiration of the time-charter contract for the 52 percent-owned Methane Spirit LNG carrier in mid-March 2015. These decreases were partially offset by the acquisition of the Norgas Napa LPG carrier in late-2014, higher revenues from Exmar LPG as a result of four newbuilding deliveries in 2014 and early-2015 and fewer scheduled drydockings and unscheduled off-hire days compared to the same period of the prior year.
In February 2015, Teekay LNG entered into an agreement with Daewoo Shipbuilding & Marine Engineering Co., Ltd. of South Korea for the construction of one additional 173,400 cubic meter LNG carrier newbuilding, for a total fully built-up cost of approximately $220 million, with options to order up to four additional vessels. This vessel, and any of these optional newbuildings, if exercised, will be constructed with M-type, Electronically Controlled, Gas Injection (MEGI) twin engines, which are designed to be significantly more fuel-efficient and have lower emission levels than engines currently used in LNG shipping. Teekay LNG intends to secure long-term contract employment for the ordered vessel prior to its scheduled delivery in the fourth quarter of 2018.
In January 2015, the Magellan Spirit LNG carrier, in which Teekay LNG has a 52 percent ownership interest through a joint venture with Marubeni Corporation (the Teekay LNG-Marubeni Joint Venture), was involved in a grounding incident. The vessel was subsequently refloated and returned to service with a majority of the costs of the grounding expected to be covered by insurance, less an applicable deductible. As a result of this incident, the charterer claimed 59 days of vessel off-hire during the first quarter of 2015, which in the view of the charterer, permitted the charterer to terminate the charter contract which it claimed to do effective in late-March 2015. The Teekay LNG-Marubeni Joint Venture has disputed both the charterer's aggregate off-hire claims as well as the charterer's ability to terminate the charter contract, which would have otherwise expired in September 2016. The Teekay LNG-Marubeni Joint Venture has obtained legal assistance in resolving this dispute.
In mid-March 2015, the charter contract for the Methane Spirit LNG carrier, which is also owned by the Teekay LNG-Marubeni Joint Venture, expired as scheduled.
The Teekay LNG-Marubeni Joint Venture has secured short-term employment, commencing in September 2015, for both the Magellan Spirit and the Methane Spirit at significantly lower charter rates and continues to seek medium-term to long-term employment.
Teekay Tankers Ltd.
Teekay Tankers is an international owner and operator of conventional crude oil and refined product tankers through its fleet of 33 conventional tankers, including direct ownership in Aframax tankers, Suezmax tankers, Long Range 2 (LR2) product tankers, Medium-Range (MR) product tankers and a 50 percent-owned Very Large Crude Carrier (VLCC), and 12 chartered-in conventional tankers. Of these 45 vessels, eight are employed on fixed-rate time-charters, generally ranging from one to three years in initial duration, with the remaining vessels trading in spot tanker pools. In addition, Teekay Tankers owns a minority interest of 9.3 percent in Tanker Investments Ltd. (TIL) (OSLO: TIL), which currently owns a fleet of 20 modern tankers, including six Suezmax tankers to be acquired in the second quarter of 2015. Based on its current ownership of Teekay Tankers Class A common stock and its ownership of 100 percent of the outstanding Class B stock, Teekay Parent currently owns a 25.5 percent economic interest in, and has voting control of, Teekay Tankers.
For the first quarter of 2015, Teekay Tankers declared a dividend of $0.03 per share. Based on its ownership of Teekay Tankers Class A and Class B shares, the dividend received by Teekay Parent totaled $0.9 million for the first quarter of 2015.
Cash flow from vessel operations from Teekay Tankers increased to $58.2 million in the first quarter of 2015, from $34.7 million in the same period of the prior year. The increase is primarily due to stronger average spot tanker rates earned in the first quarter of 2015 compared to the same period in the prior year, an increase in fleet size due to the acquisition of four LR2 product tankers and one Aframax tanker in the first quarter of 2015, the addition of ten in-chartered vessels during 2014 and higher equity income as a result of higher earnings from TIL due to stronger average spot tanker rates and commercial and technical management fees earned through Teekay Tankers' 50 percent interest in the conventional tanker commercial management and technical management operations acquired from Teekay Parent (Teekay Operations) on August 1, 2014.
In the first quarter of 2015, Teekay Tankers completed the acquisition of four LR2 product tankers and one Aframax tanker for an aggregate purchase price of approximately $230 million. Teekay Tankers took delivery of these vessels in February and March 2015. All four LR2 product tankers are currently trading in the Taurus LR2 pool and the Aframax tanker is on voyage charter until vetting inspections are completed for joining the Teekay Aframax RSA.
During the first quarter of 2015, Teekay Tankers secured time charter-in contracts for one additional Aframax tanker and one additional LR2 product tanker, bringing Teekay Tankers' total time chartered-in fleet to 12 vessels. The new time charter-in contracts have an average daily rate of $21,250 and firm contract periods of 24 months, with extension options. The time charter-in contract for the Aframax commenced in April 2015 and the LR2 contract is expected to commence in the second quarter of 2015.
Teekay Parent
In addition to its equity ownership interests in Teekay Offshore, Teekay LNG and Teekay Tankers, Teekay Parent directly owns four FPSO units (including the Petrojarl Knarr (Knarr) FPSO unit, which Teekay Offshore has agreed to acquire upon commencement of its charter contract at full rate) and one VLCC vessel. As at May 1, 2015, Teekay Parent also had six chartered-in conventional tankers (including four Aframax tankers owned by Teekay Offshore), two chartered-in LNG carriers owned by Teekay LNG, and three chartered-in FSO units and two shuttle tankers owned by Teekay Offshore.
For the first quarter of 2015, Teekay Parent generated cash flow from vessel operations of $7.0 million, compared to negative cash flow from vessel operations of $5.3 million in the same period of the prior year. The increase in cash flow is primarily due to the Banff FPSO unit recommencing operations under its time-charter contract in July 2014 after being off-hire for repairs following damage from a storm event in late-2011, a contract rate step-up for the Banff FPSO effective January 1, 2015, the commencement of the Knarr FPSO units charter contract at partial rate with BG Norge Limited (BG) in mid-March 2015 following the achievement of first oil and higher average spot tanker rates.
In mid-March 2015, the Knarr FPSO unit achieved first oil and commenced its charter contract with BG at partial rate. In December 2014, Teekay Offshore's Board of Director's approved the acquisition of the Knarr FPSO from Teekay Parent, subject to the unit completing certain operational tests and commencing its charter contract at full rate, which is expected to occur during the second quarter of 2015. Teekay Offshore's purchase price for the Knarr, which is based on a fully built-up cost of approximately $1.25 billion, is expected to be financed through the assumption of an existing $780 million long-term debt facility, a combination of vendor financing from, and new Teekay Offshore common units to be issued to, Teekay Parent, and a portion of the approximately $121 million of net proceeds from Teekay Offshore's preferred unit public offering completed in April 2015.
Fleet List
The following table summarizes Teekay's consolidated fleet of 201 vessels as at May 1, 2015, including chartered-in vessels and vessels under construction but excluding vessels managed for third parties:
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Number of Vessels(1)
---------------------------------------------
Owned Chartered-in Newbuildings /
Vessels Vessels Conversions Total
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Teekay Parent Fleet(2)(3)
Aframax Tankers (4) - 2 - 2
VLCC Tanker 1 - - 1
FPSO Units 4 - - 4
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Total Teekay Parent Fleet 5 2 - 7
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Teekay Offshore Fleet(5) 52 2 9 63
Teekay LNG Fleet 56 3 27 86
Teekay Tankers Fleet(6) 33 12 - 45
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Total Teekay Consolidated Fleet 146 19 36 201
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(1) Ownership interests in these vessels range from 20 percent to 100
percent.
(2) Excludes two LNG carriers chartered-in from Teekay LNG.
(3) Excludes two shuttle tankers and three FSO units chartered-in from
Teekay Offshore.
(4) Excludes four Aframax tankers chartered-in from Teekay Offshore.
(5) Owned Vessels includes two long-distance towing and offshore
installation vessels that Teekay Offshore agreed to acquire in October 2014,
which are expected to deliver in the second quarter of 2015.
(6) Chartered-in Vessels includes one chartered-in conventional tanker that
is expected to deliver in the second quarter of 2015.
Liquidity
As at March 31, 2015, the Company had consolidated liquidity of $986.0 million (consisting of $684.5 million of cash and cash equivalents and $301.5 million of undrawn revolving credit facilities), of which $266.6 million of liquidity (consisting of $258.7 million cash and cash equivalents and $8.1 million of undrawn revolving credit facilities) is attributable to Teekay Parent. Giving pro-forma effect to the $121 million of net proceeds from Teekay Offshore's preferred unit public offering completed in April 2015 and approximately $130 million of net proceeds from Teekay LNG's Norwegian bond offering completed in May 2015, the Company's consolidated liquidity as at March 31, 2015 was approximately $1.2 billion.
Availability of 2014 Annual Report
The Company filed its 2014 Annual Report on Form 20-F with the U.S. Securities and Exchange Commission (SEC) on April 29, 2015. Copies of this report are available on Teekay Corporation's website, under "SEC Filings", at www.teekay.com. Shareholders may request a printed copy of this Annual Report, including the complete audited financial statements, free of charge by contacting Teekay Corporation's Investor Relations.
Conference Call
The Company plans to host a conference call on Thursday, May 14, 2015 at 11:00 a.m. (ET) to discuss its results for the first quarter of 2015. 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 (800) 505-9587 or (416) 204-9524, if outside North America,
and quoting conference ID code 7062529.
-- 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
30 days).
The conference call will be recorded and available until Thursday, May 28, 2015. 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 7062529.
About Teekay
Teekay Corporation is a portfolio manager and project developer in the marine midstream space that owns a 2 percent general partner interest, all of the outstanding incentive distributions rights and a portion of the outstanding limited partner interests in Teekay LNG Partners L.P. (NYSE: TGP) and Teekay Offshore Partners L.P. (NYSE: TOO). In addition, Teekay has a controlling ownership interest in Teekay Tankers Ltd. (NYSE: TNK) and a fleet of directly-owned vessels. The combined Teekay entities manage and operate consolidated assets of over $12 billion, comprised of approximately 200 liquefied gas, offshore, and conventional tanker assets (excluding vessels managed for third parties). With offices in 15 countries and approximately 6,700 seagoing and shore-based employees, Teekay provides a comprehensive set of marine services to the world's leading oil and gas companies, and its reputation for safety, quality and innovation has earned it a position with its customers as The Marine Midstream Company.
Teekay's common stock is listed on the New York Stock Exchange where it trades under the symbol "TK".
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TEEKAY CORPORATION
SUMMARY CONSOLIDATED STATEMENTS OF INCOME
(in thousands of U.S. dollars, except share and per share data)
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Three Months Ended
March 31, December 31, March 31,
2015 2014 2014
(unaudited) (unaudited) (unaudited)
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REVENUES(1) 545,862 544,989 506,494
Voyage expenses (25,670) (25,213) (35,012)
Vessel operating expenses (1)(2) (184,203) (200,333) (201,186)
Time-charter hire expense (24,927) (24,315) (16,292)
Depreciation and amortization (112,704) (109,238) (103,458)
General and administrative (2) (37,954) (34,509) (37,878)
Asset impairments (3) (15,496) - -
Gain (loss) on sale of vessels and
equipment 1,643 2,839 (162)
Restructuring charges (9,126) (6,766) (639)
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Income from vessel operations 137,425 147,454 111,867
Interest expense (2) (51,346) (57,334) (49,333)
Interest income (2) 1,530 1,465 1,783
Realized and unrealized loss on
derivative instruments (2) (83,386) (103,304) (47,248)
Equity income (4) 20,749 25,417 27,494
Income tax recovery (expense) 995 (1,071) (2,798)
Foreign exchange gain (loss) 17,510 (3,126) (894)
Other income (loss) 375 (6,998) 8,251
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Net income 43,852 2,503 49,122
Less: Net income attributable to non-
controlling interests (53,616) (16,159) (49,610)
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Net loss attributable to shareholders
of Teekay Corporation (9,764) (13,656) (488)
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Loss per common share of Teekay
- Basic ($0.13) ($0.19) ($0.01)
- Diluted ($0.13) ($0.19) ($0.01)
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Weighted-average number of common
shares outstanding
- Basic 72,549,068 72,498,974 71,328,577
- Diluted 72,549,068 72,498,974 71,328,577
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(1) The costs of certain business development and engineering studies relating to North Sea FPSO and FSO projects that the Company pursues are partially reimbursable from customers upon completion. As a result, $1.1 million of revenues and $2.0 million of costs were recognized for the three months ended December 31, 2014.
(2) Realized and unrealized losses related to derivative instruments that are not designated as hedges for accounting purposes are included as a separate line item in the statements of income. The realized losses relate to the amounts the Company actually received or paid to settle such derivative instruments and the unrealized losses relate to the change in fair value of such derivative instruments, as detailed in the table below:
Three Months Ended
March 31, December 31, March 31,
2015 2014 2014
Realized (losses) gains relating to:
Interest rate swaps (27,889) (33,072) (29,490)
Termination of interest rate swap
agreements - (2,319) 1,000
Foreign currency forward contracts (5,428) (2,828) (1,285)
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(33,317) (38,219) (29,775)
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Unrealized (losses) gains relating to:
Interest rate swaps (43,660) (53,111) (25,398)
Foreign currency forward contracts (6,329) (14,154) 3,051
Stock purchase warrants in TIL (80) 2,180 4,874
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(50,069) (65,085) (17,473)
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Total realized and unrealized losses
on non-designated derivative
instruments (83,386) (103,304) (47,248)
-------------------------------------
-------------------------------------
(3) The Company recognized asset impairments of $15.5 million for the three months ended March 31, 2015 related to the impairment of two shuttle tankers owned by Teekay Offshore. The impairment for the shuttle tankers was the result of a recent change in the operating plan for one shuttle tanker and the expected sale of the other shuttle tanker.
(4) The Company's proportionate share of items within equity income as identified in Appendix A of this release, is detailed in the table below. By excluding these items from equity income, the Company believes that the resulting adjusted equity income can be used to evaluate the financial performance of the Company's equity accounted investments. Adjusted equity income is a non-GAAP measure.
Three Months Ended
March 31, December 31, March 31,
2015 2014 2014
Equity income 20,749 25,417 27,494
Proportionate share of unrealized
losses on derivative instruments 2,422 2,082 909
Dilution gain on share issuance by
TIL - - (4,108)
Other (i) 4,788 - 966
--------------------------------------
Equity income adjusted for items in
Appendix A 27,959 27,499 25,261
--------------------------------------
--------------------------------------
(i) Includes derecognition of deferred tax asset and unrealized foreign
exchange losses in Sevan Marine AS for the three months ended March 31,
2015. Includes loss on sale of vessel in Exmar LPG BVBA joint venture for
the three months ended March 31, 2014.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
SUMMARY CONSOLIDATED BALANCE SHEETS
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
As at March 31, As at December 31,
2015 2014
(unaudited) (unaudited)
ASSETS
Cash and cash equivalents 684,511 806,904
Other current assets 468,439 473,872
Restricted cash - current 106,808 33,653
Restricted cash - long-term 48,982 85,698
Assets held for sale(1) 5,000 -
Vessels and equipment 7,989,484 6,399,747
Advances on newbuilding
contracts and conversions costs 693,329 1,706,500
Derivative assets 10,967 14,415
Investment in equity accounted
investees 847,408 873,421
Investment in direct financing
leases 702,426 704,953
Other assets 485,899 501,812
Intangible assets 91,697 94,666
Goodwill 168,571 168,571
----------------------------------------------------------------------------
Total assets 12,303,521 11,864,212
----------------------------------------------------------------------------
----------------------------------------------------------------------------
LIABILITIES AND EQUITY
Accounts payable and accrued
liabilities 454,552 480,049
Current portion of long-term
debt 911,969 658,556
Long-term debt 6,268,977 6,141,492
Derivative liabilities 728,412 626,139
In-process revenue contracts 167,721 173,412
Other long-term liabilities 409,641 383,089
Redeemable non-controlling
interest 12,059 12,842
Equity:
Non-controlling interests 2,283,434 2,290,305
Shareholders of Teekay 1,066,756 1,098,328
----------------------------------------------------------------------------
Total liabilities and equity 12,303,521 11,864,212
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) In connection with the expected sale of an older shuttle tanker by
Teekay Offshore, the vessel and equipment related to the vessel were
classified as "Assets held for sale" as at March 31, 2015.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended
March 31
2015 2014
(unaudited) (unaudited)
Cash and cash equivalents provided by (used for)
OPERATING ACTIVITIES
----------------------------------------------------------------------------
Net operating cash flow 181,668 103,737
----------------------------------------------------------------------------
FINANCING ACTIVITIES
Net proceeds from long-term debt 786,048 306,085
Scheduled repayments of long-term debt (110,810) (84,451)
Prepayments of long-term debt (215,199) (130,000)
Increase in restricted cash (4,452) (244)
Net proceeds from equity issuances of subsidiaries 20,280 -
Equity contribution from joint venture partner - 6,500
Distribution from subsidiaries to non-controlling
interests (82,136) (96,125)
Cash dividends paid (22,926) (23,467)
Issuance of common stock upon exercise of stock
options 251 34,720
----------------------------------------------------------------------------
Net financing cash flow 371,056 13,018
----------------------------------------------------------------------------
INVESTING ACTIVITIES
Expenditures for vessels and equipment (665,091) (106,299)
Proceeds from sale of vessels and equipment 8,918 -
Repayments from joint ventures and joint venture
partners 15,916 1,478
Investment in equity accounted investments (7,005) (50,322)
Direct financing lease payments received 2,527 5,228
Increase in restricted cash (1) (34,082) -
Other 3,700 2,492
----------------------------------------------------------------------------
Net investing cash flow (675,117) (147,423)
----------------------------------------------------------------------------
Decrease in cash and cash equivalents (122,393) (30,668)
Cash and cash equivalents, beginning of the period 806,904 614,660
----------------------------------------------------------------------------
Cash and cash equivalents, end of the period 684,511 583,992
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Increase in restricted cash for the three months ended March 31, 2015
relates to Teekay Offshore's cash held in escrow related to a holdback on
the purchase price of three towing and offshore installation vessels during
the period.
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX A - SPECIFIC ITEMS AFFECTING NET INCOME
(in thousands of U.S. dollars, except per share data)
Set forth below is a reconciliation of the Company's unaudited adjusted net
income attributable to shareholders of Teekay, a non-GAAP financial
measure, to net loss attributable to shareholders of Teekay as determined
in accordance with GAAP. The Company believes that, in addition to
conventional measures prepared in accordance with GAAP, certain investors
use this information to evaluate the Company's financial performance. The
items below are also typically excluded by securities analysts in their
published estimates of the Company's financial results. Adjusted net
income attributable to the shareholders of Teekay 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 Three Months Ended
March 31, 2015 March 31, 2014
(unaudited) (unaudited)
$ Per $ Per
$ Share(1) $ Share(1)
----------------------------------------------------------------------------
Net income - GAAP basis 43,852 49,122
Adjust for: Net income attributable
to non-controlling interests (53,616) (49,610)
----------------------------------------------------------------------------
Net loss attributable to
shareholders of Teekay (9,764) (0.13) (488) (0.01)
Add (subtract) specific items
affecting net loss:
Unrealized losses from derivative
instruments(2) 52,491 0.72 18,382 0.26
Foreign exchange (gain) loss(3) (21,673) (0.30) 749 0.01
Net (gain) loss on sale of
vessels(4) (1,643) (0.02) 162 -
Restructuring charges, net of
recovery(5) 3,802 0.05 639 0.01
Realized gain upon termination of
interest rate swap - - (1,000) (0.01)
Dilution gain on share issuance by
TIL (6) - - (4,108) (0.06)
Asset impairments (7) 15,496 0.21 - -
Pre-operational costs (8) 3,598 0.05 - -
Other(9) 5,348 0.08 (1,587) (0.01)
Non-controlling interests' share of
items above(10) (31,925) (0.44) (9,273) (0.13)
----------------------------------------------------------------------------
Total adjustments 25,494 0.35 3,964 0.06
----------------------------------------------------------------------------
Adjusted net income attributable to
shareholders of Teekay 15,730 0.22 3,476 0.05
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Basic per share amounts.
(2) Reflects the unrealized 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 included in equity income from joint
ventures.
(3) Foreign currency exchange gains and losses primarily relate to the
Company's debt denominated in Euros and Norwegian Kroner in addition to the
unrealized gains and losses on cross currency swaps used to hedge the
principal and interest on the Company's Norwegian Kroner bonds. Nearly all
of the Company's foreign currency exchange gains and losses are unrealized.
(4) Net gain on sale of vessels for the three months ended March 31, 2015
includes the gain on sale of a shuttle tanker. Net loss on sale of vessels
for the three months ended March 31, 2014 includes the loss relating to the
sale of four conventional tankers to TIL.
(5) Restructuring charges for the three months ended March 31, 2015
primarily relate to the reorganization of the Company's marine operations
and corporate shared services. Restructuring charges for the three months
ended March 31, 2014 primarily relate to the reorganization of the Company's
marine operations and termination of crew upon reflagging a shuttle tanker
in Teekay Offshore.
(6) The Company recognized a gain from the share issuance completed as part
of TIL's initial public offering in March 2014.
(7) Includes the impairment of two shuttle tankers to their estimated fair
values.
(8) Relates to pre-operational costs and realized losses on interest rate
swaps for the Knarr FPSO unit.
(9) Other for the three months ended March 31, 2015 primarily relates to
derecognition of deferred tax asset and unrealized foreign exchange losses
in Sevan Marine AS and realized losses on foreign exchange forward contracts
related to the upgrade costs of an FPSO. Other for the three months ended
March 31, 2014 primarily relates to an external transaction fee related to
Teekay Offshore's acquisition of ALP, pre-operational costs for an FPSO unit
nearing completion and an initial unrealized gain on the TIL stock purchase
warrants issued to Teekay and Teekay Tankers.
(10) If any of the specific items affecting net loss originate from a
consolidated non-wholly-owned subsidiary, the net income attributable to
non-controlling interests of these subsidiaries is recalculated without
these specific items affecting net loss. The amount identified as "Non-
controlling interests' share of items above" in the table above is the
cumulative change to the Company's net income attributable to non-
controlling interests by excluding the specific items affecting net loss.
------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY BALANCE SHEET AS AT MARCH 31, 2015
(in thousands of U.S. dollars)
------------------------------------------------------------------------
(unaudited)
Teekay Teekay Teekay
Offshore LNG Tankers
------------------------------------
ASSETS
Cash and cash equivalents 278,846 106,410 40,513
Other current assets 119,136 17,926 102,655
Restricted cash 69,972 56,632 -
Assets held for sale 5,000 - -
Vessels and equipment 3,076,643 1,731,727 1,047,231
Advances on newbuilding contracts
and conversion costs 395,945 298,362 -
Derivative assets 1,679 - 4,617
Investment in equity accounted
investees 64,061 683,825 60,999
Investment in direct financing
leases 21,312 681,114 -
Other assets 57,385 210,879 17,408
Advances to (from) affiliates 33,032 17,254 6,041
Equity investment in subsidiaries - - -
Intangibles and goodwill 134,800 121,064 -
------------------------------------
TOTAL ASSETS 4,257,811 3,925,193 1,279,464
------------------------------------
------------------------------------
LIABILITIES AND EQUITY
Accounts payable and accrued
liabilities 133,069 50,632 25,493
Advances from (to) affiliates 125,724 52,749 14,863
Current portion of long-term debt 395,008 180,133 147,004
Long-term debt 2,311,922 1,735,394 564,912
Derivative liabilities 408,389 206,617 17,306
In-process revenue contracts 85,407 36,330 -
Other long-term liabilities 55,178 106,107 4,862
Redeemable non-controlling interest 12,059 - -
Equity:
Non-controlling interests (2) 50,021 12,902 -
Equity attributable to
shareholders/unitholders of
publicly-listed entities 681,034 1,544,329 505,024
------------------------------------
TOTAL LIABILITIES AND EQUITY 4,257,811 3,925,193 1,279,464
------------------------------------
------------------------------------
NET DEBT(3) 2,358,112 1,752,485 671,403
------------------------------------
------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY BALANCE SHEET AS AT MARCH 31, 2015
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
(unaudited)
Teekay Consolidation
Parent Adjustments(1) Total
----------------------------------------
ASSETS
Cash and cash equivalents 258,742 - 684,511
Other current assets 228,722 - 468,439
Restricted cash 29,186 - 155,790
Assets held for sale - - 5,000
Vessels and equipment 2,133,883 - 7,989,484
Advances on newbuilding contracts
and conversion costs (978) - 693,329
Derivative assets 4,671 - 10,967
Investment in equity accounted
investees 66,024 (27,501) 847,408
Investment in direct financing
leases - - 702,426
Other assets 200,227 - 485,899
Advances to (from) affiliates (56,327) - -
Equity investment in subsidiaries 482,415 (482,415) -
Intangibles and goodwill 4,404 - 260,268
----------------------------------------
TOTAL ASSETS 3,350,969 (509,916) 12,303,521
----------------------------------------
----------------------------------------
LIABILITIES AND EQUITY
Accounts payable and accrued
liabilities 245,358 - 454,552
Advances from (to) affiliates (193,336) - -
Current portion of long-term debt 189,824 - 911,969
Long-term debt 1,656,749 - 6,268,977
Derivative liabilities 96,100 - 728,412
In-process revenue contracts 45,984 - 167,721
Other long-term liabilities 243,494 - 409,641
Redeemable non-controlling interest - - 12,059
Equity:
Non-controlling interests (2) 40 2,220,471 2,283,434
Equity attributable to
shareholders/unitholders of
publicly-listed entities 1,066,756 (2,730,387) 1,066,756
----------------------------------------
TOTAL LIABILITIES AND EQUITY 3,350,969 (509,916) 12,303,521
----------------------------------------
----------------------------------------
NET DEBT(3) 1,558,645 - 6,340,645
----------------------------------------
----------------------------------------
(1) Consolidation Adjustments column includes adjustments which eliminates
transactions between subsidiaries Teekay Offshore, Teekay LNG and Teekay
Tankers and Teekay Parent and Teekay Tanker's investment in Teekay
Operations.
(2) Non-controlling interests in the Teekay Offshore and Teekay LNG columns
represent the respective joint venture partners' share of joint venture net
assets. Non-controlling interest in the Consolidation Adjustments column
represents the public's share of the net assets of Teekay's publicly-traded
subsidiaries.
(3) Net debt represents current and long-term debt less cash and cash
equivalents and, if applicable, current and long-term restricted cash.
--------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY STATEMENT OF INCOME FOR THE THREE MONTHS ENDED MARCH 31, 2015
(in thousands of U.S. dollars)
--------------------------------------------------------------------------
(unaudited)
Teekay Teekay Teekay
Offshore LNG Tankers
---------------------------------------
Revenues 250,911 97,326 103,878
Voyage expenses (22,517) (318) (3,834)
Vessel operating expenses (74,034) (21,634) (22,441)
Time-charter hire expense (6,983) - (15,003)
Depreciation and amortization (53,604) (23,569) (13,672)
General and administrative (14,880) (6,708) (3,300)
Asset impairments (15,496) - -
Gain on sale of vessels and
equipment 1,643 - -
Restructuring charges - - (5,324)
---------------------------------------
Income (loss) from vessel
operations 65,040 45,097 40,304
Interest expense (23,183) (10,104) (2,365)
Interest income 134 734 31
Realized and unrealized losses on
derivative instruments (51,648) (14,032) (1,587)
Income tax (expense) recovery (845) 225 68
Equity income (loss) 4,091 18,058 2,582
Equity in earnings of subsidiaries
(2) - - -
Foreign exchange (loss) gain (7,076) 25,930 (48)
Other income (loss) 259 443 -
---------------------------------------
Net (loss) income (13,228) 66,351 38,985
Less: Net income attributable to
non-controlling interests (3) (3,998) (3,283) -
---------------------------------------
Net (loss) income attributable
toshareholders/unitholdersof
publicly-listed entities (17,226) 63,068 38,985
---------------------------------------
---------------------------------------
CFVO - Consolidated(4)(5) 127,807 72,705 53,976
CFVO - Equity Investments(6) 8,854 46,304 4,176
CFVO - Total 136,661 119,009 58,152
---------------------------------------
---------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY STATEMENT OF INCOME FOR THE THREE MONTHS ENDED MARCH 31, 2015
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
(unaudited)
Teekay Consolidation
Parent Adjustments(1) Total
-----------------------------------------
Revenues 118,238 (24,491) 545,862
Voyage expenses (87) 1,086 (25,670)
Vessel operating expenses (66,094) - (184,203)
Time-charter hire expense (28,827) 25,886 (24,927)
Depreciation and amortization (21,859) - (112,704)
General and administrative (12,578) (488) (37,954)
Asset impairments - - (15,496)
Gain on sale of vessels and
equipment - - 1,643
Restructuring charges (1,782) (2,020) (9,126)
-----------------------------------------
Income (loss) from vessel
operations (12,989) (27) 137,425
Interest expense (15,694) - (51,346)
Interest income 631 - 1,530
Realized and unrealized losses on
derivative instruments (16,119) - (83,386)
Income tax (expense) recovery 1,547 - 995
Equity income (loss) (3,849) (133) 20,749
Equity in earnings of subsidiaries
(2) 38,555 (38,555) -
Foreign exchange (loss) gain (1,459) 163 17,510
Other income (loss) (387) 60 375
-----------------------------------------
Net (loss) income (9,764) (38,492) 43,852
Less: Net income attributable to
non-controlling interests (3) - (46,335) (53,616)
-----------------------------------------
Net (loss) income attributable
toshareholders/unitholdersof
publicly-listed entities (9,764) (84,827) (9,764)
-----------------------------------------
-----------------------------------------
CFVO - Consolidated(4)(5) 3,807 (27) 258,268
CFVO - Equity Investments(6) 3,226 27 62,587
CFVO - Total 7,033 - 320,855
-----------------------------------------
-----------------------------------------
(1) Consolidation Adjustments column includes adjustments which eliminates
transactions between subsidiaries Teekay Offshore, Teekay LNG and Teekay
Tankers and Teekay Parent and Teekay Tanker's investment in Teekay
Operations.
(2) Teekay Corporation's proportionate share of the net earnings of its
publicly-traded subsidiaries.
(3) Net income attributable to non-controlling interests in the Teekay
Offshore and Teekay LNG columns represent the joint venture partners' share
of the net income 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 (loss) income of Teekay's
publicly-traded subsidiaries.
(4) CFVO represents income from vessel operations before depreciation and
amortization expense, amortization of in-process revenue contracts, vessel
write-downs, gains or losses on the sale of vessels 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. Cash
flow from vessel operations is a non-GAAP financial measure used by certain
investors to measure the financial performance of shipping companies. Please
see Appendix C and Appendix E to this release for a reconciliation of this
non-GAAP measure as used in this release to the most directly comparable
GAAP financial measure.
(5) 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 March 31, 2015,
Teekay Parent received cash dividends and distributions from these
subsidiaries totaling $45.3 million. The dividends and distributions
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 to this release for further details.
(6) CFVO - Equity Investments represents the Company's proportionate share
of CFVO from its equity accounted vessels and other investments. Please see
Appendix C and Appendix E to this release for reconciliations of this non-
GAAP measure as used in this release to the most directly comparable GAAP
financial measure.
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX C - SUPPLEMENTAL FINANCIAL INFORMATION
TEEKAY PARENT SUMMARY OPERATING RESULTS
FOR THE THREE MONTHS ENDED MARCH 31, 2015
(in thousands of U.S. dollars)
(unaudited)
Set forth below is a reconciliation of unaudited cash flow from vessel
operations, a non-GAAP financial measure, to income (loss) from vessel
operations as determined in accordance with GAAP, for Teekay Parent's
primary operating segments. The Company believes that, in addition to
conventional measures prepared in accordance with GAAP, certain investors
use this information to evaluate Teekay Parent's financial performance.
Disaggregated cash flow from vessel operations for Teekay Parent, as
provided below, is intended to provide additional information and should
not be considered a substitute for measures of performance prepared in
accordance with GAAP.
----------------------------------------------------------------------------
Owned In-Chartered
Conventional Conventional
Tankers Tankers FPSOs
-----------------------------------
Revenues 5,170 11,303 83,005
Voyage expenses - (78) (9)
Vessel operating expenses (785) (2,849) (56,893)
Time-charter hire expense - (10,436) (7,084)
Depreciation and amortization (713) - (21,259)
General and administrative (94) (416) (5,899)
Restructuring charges - - -
-----------------------------------
Income (loss) from vessel operations 3,578 (2,476) (8,139)
-----------------------------------
Reconciliation of income (loss) from vessel operations to cash flow from
vessel operations
Income (loss) from vessel operations 3,578 (2,476) (8,139)
Depreciation and amortization 713 - 21,259
Amortization of in-process revenue
contracts and other - - (3,457)
Realized losses from the settlements of
non-designated derivative instruments - - (2,176)
-----------------------------------
CFVO - Consolidated(2)(3) 4,291 (2,476) 7,487
CFVO - Equity(4) 3,304 - 42
-----------------------------------
CFVO - Total 7,595 (2,476) 7,529
-----------------------------------
-----------------------------------
------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX C - SUPPLEMENTAL FINANCIAL INFORMATION
TEEKAY PARENT SUMMARY OPERATING RESULTS
FOR THE THREE MONTHS ENDED MARCH 31, 2015
(in thousands of U.S. dollars)
(unaudited)
Set forth below is a reconciliation of unaudited cash flow from vessel
operations, a non-GAAP financial measure, to income (loss) from vessel
operations as determined in accordance with GAAP, for Teekay Parent's
primary operating segments. The Company believes that, in addition to
conventional measures prepared in accordance with GAAP, certain
investors use this information to evaluate Teekay Parent's financial
performance. Disaggregated cash flow from vessel operations for Teekay
Parent, as provided below, is intended to provide additional
information and should not be considered a substitute for measures of
performance prepared in accordance with GAAP.
------------------------------------------------------------------------
Teekay
Corporate Parent
Other (1) G&A Total
-------------------------------
Revenues 18,760 - 118,238
Voyage expenses - - (87)
Vessel operating expenses (5,567) - (66,094)
Time-charter hire expense (11,307) - (28,827)
Depreciation and amortization 113 - (21,859)
General and administrative 720 (6,889) (12,578)
Restructuring charges (1,782) - (1,782)
-------------------------------
Income (loss) from vessel operations 937 (6,889) (12,989)
-------------------------------
Reconciliation of income (loss) from vessel operations to cash flow
from vessel operations
Income (loss) from vessel operations 937 (6,889) (12,989)
Depreciation and amortization (113) - 21,859
Amortization of in-process revenue
contracts and other 570 - (2,887)
Realized losses from the settlements of
non-designated derivative instruments - - (2,176)
-------------------------------
CFVO - Consolidated(2)(3) 1,394 (6,889) 3,807
CFVO - Equity(4) (120) - 3,226
-------------------------------
CFVO - Total 1,274 (6,889) 7,033
-------------------------------
-------------------------------
(1) Includes results of two chartered-in LNG carriers owned by Teekay LNG
and two chartered-in FSO units owned by Teekay Offshore.
(2) CFVO represents income from vessel operations before depreciation and
amortization expense, amortization of in-process revenue contracts, vessel
write-downs, gains or losses on the sale of vessels 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 Teekay Parent's
CFVO from vessels that are consolidated on the Company's financial
statements. Cash flow from vessel operations is a non-GAAP financial measure
used by certain investors to measure the financial performance of shipping
companies. Please see Appendix E to this release for a reconciliation of
this non-GAAP measure as used in this release to the most directly
comparable GAAP financial measure.
(3) In addition to the CFVO generated by its directly owned and in-chartered
assets, Teekay Parent also receives cash dividends and distributions from
its publicly-traded subsidiaries. For the three months ended March 31, 2015,
Teekay Parent received cash dividends and distributions from these
subsidiaries totaling $45.3 million. The dividends and distributions
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 to this release for further details.
(4) CFVO - Equity Investments represents Teekay Parent's proportionate share
of CFVO from its equity accounted vessels and other investments. Please see
Appendix E to this release for a reconciliation of this non-GAAP measure as
used in this release to the most directly comparable GAAP financial measure.
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX D - SUPPLEMENTAL FINANCIAL INFORMATION
TEEKAY PARENT FREE CASH FLOW
(in thousands of U.S. dollars)
(unaudited)
Set forth below is an unaudited calculation of Teekay Parent free cash flow
for the three months ended March 31, 2015,December 31, 2014, September 30,
2014, June 30, 2014, and March 31, 2014. The Company defines free cash
flow, a non-GAAP financial measure, as the sum of (a) cash flow from
vessel operations attributed to its directly-owned and in-chartered
assets, net of interest expense and drydock expenditures in the respective
period (collectively, OPCO) plus (b) distributions received 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 in the respective period
(collectively, GPCO).
----------------------------------------------------------------------------
Three Months Ended
September
March 31, December 31, 30, June 30, March 31,
2015 2014 2014 2014 2014
Teekay Parent
OPCO Cash Flow
Teekay Parent
Cash Flow from
Vessel
Operations (1)
Owned
Conventional
Tankers 4,291 1,549 277 855 4,490
In-Chartered
Conventional
Tankers (2,476) (5,067) (4,441) (4,818) (2,819)
FPSOs 7,487 18,077 (10,027) (25,700) (13,906)
Other (2) 1,381 7,679 5,021 9,748 12,408
-----------------------------------------------------------
Total (3) 10,683 22,238 (9,170) (19,915) 173
Less:
Net interest
expense (4) (17,534) (15,056) (13,000) (15,015) (16,151)
Dry docking
expenditures - (3,652) (2,673) (378) (549)
-----------------------------------------------------------
Teekay Parent
OPCO Cash Flow (6,851) 3,530 (24,843) (35,308) (16,527)
-----------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Teekay Parent
GPCO Cash Flow
Daughter Company
Distributions to
Teekay Parent(5)
Limited Partner
Interest (6)
Teekay LNG
Partners 17,646 17,646 17,439 17,439 17,439
Teekay Offshore
Partners 12,819 12,819 12,819 12,819 12,819
General Partner
Interest
Teekay LNG
Partners 8,653 8,650 7,883 7,883 7,568
Teekay Offshore
Partners 5,264 5,262 4,880 4,880 4,868
Other Dividends
Teekay Tankers
(6)(7) 881 881 756 629 629
-----------------------------------------------------------
Total Daughter
Distributions 45,263 45,258 43,777 43,650 43,323
-----------------------------------------------------------
Less: Corporate
general and
administrative
expenses (6,889) (3,767) (4,068) (3,362) (5,658)
-----------------------------------------------------------
Total Parent GPCO
Cash Flow 38,374 41,491 39,709 40,288 37,665
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TOTAL TEEKAY
PARENT FREE CASH
FLOW 31,523 45,021 14,866 4,980 21,137
-----------------------------------------------------------
-----------------------------------------------------------
Total Teekay
Parent Free Cash
Flow per share 0.43 0.62 0.21 0.07 0.30
-----------------------------------------------------------
Weighted-average
number of common
shares - Basic 72,549,068 72,498,974 72,393,072 72,036,526 71,328,577
-----------------------------------------------------------
-----------------------------------------------------------
(1) CFVO represents income from vessel operations before depreciation and
amortization expense, amortization of in-process revenue contracts, vessel
write-downs, gains or losses on the sale of vessels 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 is a non-GAAP financial measure used by
certain investors to measure the financial performance of shipping
companies. Please refer to Appendix C and Appendix E to this release for a
reconciliation of this non-GAAP financial measure to the most directly
comparable GAAP financial measure.
(2) Includes ($0.01) million for the three month period ended March 31,
2015, $0.5 million for the three month period ended December 31, 2014 and
$0.8 million for the three month period ended September 30, 2014 relating to
50 percent of the CFVO from Teekay Operations.
(3) Excludes corporate general and administrative expenses relating to GPCO.
(4) Excludes realized losses on the interest rate swap related to the debt
facility secured by the Knarr FPSO unit up to commencement of operations on
March 9, 2015 of $3.3 million for the three months ended March 31, 2015,
$5.3 million for the three months ended December 31, 2014 and $4.1 million
for the three months ended September 30, 2014. Net interest expense is a
non-GAAP financial measure that includes realized gains and losses on
interest rate swaps. Please see Appendix E to this release for a
reconciliation of this non-GAAP measure as used in this release to the most
directly comparable GAAP financial measure.
(5) Cash dividend and distribution cash flows are shown on an accrual basis
for dividends and distributions declared for the respective period.
(6) 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
March 31, December 31, September 30,
2015 2014 2014
Teekay LNG Partners
Distribution per common unit $ 0.7000 $ 0.7000 $ 0.6918
Common units owned by Teekay
Parent 25,208,274 25,208,274 25,208,274
-------------------------------------------
Total distribution $ 17,645,792 $ 17,645,792 $ 17,439,084
Teekay Offshore Partners
Distribution per common unit $ 0.5384 $ 0.5384 $ 0.5384
Common units owned by Teekay
Parent 23,809,468 23,809,468 23,809,468
-------------------------------------------
Total distribution $ 12,819,018 $ 12,819,018 $ 12,819,018
Teekay Tankers Ltd.
Dividend per share $ 0.03 $ 0.03 $ 0.03
Shares owned by Teekay Parent
(7) 29,364,141 29,364,141 25,197,475
-------------------------------------------
Total dividend $ 880,924 $ 880,924 $ 755,924
Three Months Ended
June 30, March 31,
2014 2014
Teekay LNG Partners
Distribution per common unit $ 0.6918 $ 0.6918
Common units owned by Teekay
Parent 25,208,274 25,208,274
----------------------------
Total distribution $ 17,439,084 $ 17,439,084
Teekay Offshore Partners
Distribution per common unit $ 0.5384 $ 0.5384
Common units owned by Teekay
Parent 23,809,468 23,809,468
----------------------------
Total distribution $ 12,819,018 $ 12,819,018
Teekay Tankers Ltd.
Dividend per share $ 0.03 $ 0.03
Shares owned by Teekay Parent
(7) 20,976,530 20,976,530
----------------------------
Total dividend $ 629,296 $ 629,296
(7) Includes Class A and Class B shareholdings.
---------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX E - RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
CASH FLOW FROM VESSEL OPERATIONS - CONSOLIDATED
(in thousands of U.S. dollars)
(unaudited)
Set forth below is an unaudited calculation of consolidated CFVO for
the three months ended March 31, 2015 and March 31, 2014. CFVO, a
non-GAAP financial measure, represents income from vessel operations
before depreciation and amortization expense, amortization of in-
process revenue contracts, vessel write-downs, gains or losses on
the sale of vessels and adjustments for direct financing leases to a
cash basis, but includes realized gains or losses on the settlement
of foreign exchange forward contracts and a derivative charter
contract. 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 or
any other indicator of the Company's performance required by GAAP.
---------------------------------------------------------------------
Three Months Ended March 31,
2015
(unaudited)
Teekay Teekay Teekay
Offshore LNG Tankers
---------------------------------------------------------------------
Income (loss) from vessel operations 65,040 45,097 40,304
Depreciation and amortization 53,604 23,569 13,672
Amortization of in-process revenue
contracts and other (3,142) (362) -
Realized losses from the settlements
of non-designated derivative
instruments (2,694) - -
Asset impairments, net of gain on
sale of vessels and equipment 13,853 - -
Cash flow from time-charter
contracts, net of revenue accounted
for as direct finance leases 1,146 4,401 -
---------------------------------------------------------------------
Cash flow from vessel operations -
Consolidated 127,807 72,705 53,976
---------------------------------------------------------------------
---------------------------------------------------------------------
Three Months Ended March 31,
2014
(unaudited)
Teekay Teekay Teekay
Offshore LNG Tankers
---------------------------------------------------------------------
Income (loss) from vessel operations 62,342 45,383 20,780
Depreciation and amortization 48,488 24,110 12,502
Amortization of in-process revenue
contracts and other (3,142) (278) -
Realized losses from the settlements
of non-designated foreign exchange
forward contracts (497) - -
Loss on sale of vessels and equipment - - -
Cash flow from time-charter
contracts, net of revenue accounted
for as accounted for as direct
finance leases 958 2,219 -
---------------------------------------------------------------------
Cash flow from vessel operations -
Consolidated 108,149 71,434 33,282
---------------------------------------------------------------------
---------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX E - RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
CASH FLOW FROM VESSEL OPERATIONS - CONSOLIDATED
(in thousands of U.S. dollars)
(unaudited)
Set forth below is an unaudited calculation of consolidated CFVO for the
three months ended March 31, 2015 and March 31, 2014. CFVO, a non-GAAP
financial measure, represents income from vessel operations before
depreciation and amortization expense, amortization of in-process revenue
contracts, vessel write-downs, gains or losses on the sale of vessels and
adjustments for direct financing leases to a cash basis, but includes
realized gains or losses on the settlement of foreign exchange forward
contracts and a derivative charter contract. 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 or any other indicator of the Company's
performance required by GAAP.
----------------------------------------------------------------------------
Three Months Ended March 31, 2015
(unaudited)
Teekay
Teekay Consolidation Corporation
Parent Adjustments Consolidated
----------------------------------------------------------------------------
Income (loss) from vessel operations (12,989) (27) 137,425
Depreciation and amortization 21,859 - 112,704
Amortization of in-process revenue
contracts and other (2,887) - (6,391)
Realized losses from the settlements
of non-designated derivative
instruments (2,176) - (4,870)
Asset impairments, net of gain on
sale of vessels and equipment - - 13,853
Cash flow from time-charter
contracts, net of revenue accounted
for as direct finance leases - - 5,547
----------------------------------------------------------------------------
Cash flow from vessel operations -
Consolidated 3,807 (27) 258,268
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended March 31, 2014
(unaudited)
Teekay
Teekay Consolidation Corporation
Parent Adjustments Consolidated
----------------------------------------------------------------------------
Income (loss) from vessel operations (16,638) - 111,867
Depreciation and amortization 18,358 - 103,458
Amortization of in-process revenue
contracts and other (6,580) - (10,000)
Realized losses from the settlements
of non-designated foreign exchange
forward contracts (788) - (1,285)
Loss on sale of vessels and equipment 162 - 162
Cash flow from time-charter
contracts, net of revenue accounted
for as accounted for as direct
finance leases - - 3,177
----------------------------------------------------------------------------
Cash flow from vessel operations -
Consolidated (5,486) - 207,379
----------------------------------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX E - RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
CASH FLOW FROM VESSEL OPERATIONS - EQUITY ACCOUNTED VESSELS
(in thousands of U.S. dollars)
(unaudited)
Set forth below is an unaudited calculation of cash flow from vessel
operations for equity-accounted vessels for the three months ended March
31, 2015 and March 31, 2014. CFVO, a non-GAAP financial measure,
represents income from vessel operations before depreciation and
amortization expense, amortization of in-process revenue contracts, vessel
write-downs, gains or losses on the sale of vessels and adjustments for
direct financing leases to a cash basis, but includes realized gains or
losses on the settlement of foreign exchange forward contracts and a
derivative charter contract. CFVO from equity accounted vessels represents
the Company's proportionate share of CFVO from its equity accounted
vessels and other investments. 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 or any other indicator of the Company's performance required by
GAAP.
----------------------------------------------------------------------------
Three Months Ended Three Months Ended
March 31, 2015 March 31, 2014
(unaudited) (unaudited)
At Company's At Company's
100% Portion(1) 100% Portion(2)
----------------------------------------------------------------------------
Revenues 263,322 109,287 224,386 103,165
Vessel and other operating
expenses (110,981) (47,848) (101,092) (46,075)
Depreciation and
amortization (36,572) (16,207) (29,252) (14,529)
Loss on sale of vessel - - (1,931) (966)
----------------------------------------------------------------------------
Income from vessel
operations of equity
accounted vessels 115,769 45,232 92,111 41,594
Interest expense (28,591) (12,205) (22,076) (10,217)
Realized and unrealized loss
on derivative instruments (19,784) (6,997) (18,931) (6,726)
Dilution gain on share
issuance by TIL - - - 4,108
Other loss (10,541) (4,748) (2,819) (1,266)
----------------------------------------------------------------------------
Net income of equity
accounted vessels 56,853 21,282 48,285 27,494
Pro forma equity income
from Teekay Operations - (533) - -
----------------------------------------------------------------------------
Equity income of equity
accounted vessels 56,853 20,749 48,285 27,494
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Income from vessel
operations of equity
accounted vessels 115,769 45,232 92,111 41,594
Depreciation and
amortization 36,572 16,207 29,252 14,529
Loss on sale of vessel - - 1,931 966
Cash flow from time-charter
contracts net of revenue
accounted for as direct
finance lease 8,584 3,134 7,462 2,707
Amortization of in-process
revenue contracts and other (3,959) (2,013) (4,225) (2,146)
----------------------------------------------------------------------------
Cash flow from vessel
operations of equity
accounted vessels(3) 156,966 62,560 126,531 57,650
Pro forma CFVO from Teekay
Operations - 27 - -
----------------------------------------------------------------------------
Cash flow from vessel
operations of equity
accounted vessels(3) 156,966 62,587 126,531 57,650
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) The Company's proportionate share of its equity accounted vessels and
other investments ranges from 16 percent to 52 percent.
(2) The Company's proportionate share of its equity accounted vessels and
other investments ranges from 13 percent to 52 percent.
(3) 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 MEASURES
CASH FLOW FROM VESSEL OPERATIONS - TEEKAY PARENT
(in thousands of U.S. dollars)
(unaudited)
Set forth below is an unaudited calculation of Teekay Parent cash flow from
vessel operations for the three months ended December 31, 2014, September
30, 2014, June 30, 2014, and March 31, 2014. CFVO, a non-GAAP financial
measure, represents income from vessel operations before depreciation and
amortization expense, amortization of in-process revenue contracts, vessel
write-downs, gains or losses on the sale of vessels, and adjustments for
direct financing leases to a cash basis, but includes realized gains or
losses on the settlement of foreign exchange forward contracts and a
derivative charter contract. 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 or any other indicator of the Company's performance required by
GAAP.
----------------------------------------------------------------------------
Three Months Ended
December 31, 2014
(unaudited)
Owned In-chartered
Conventional Conventional
Tankers Tankers FPSOs
----------------------------------------------------------------------------
Teekay Parent income (loss) from
vessel operations 836 (5,067) 4,381
Depreciation and amortization 713 - 20,854
Loss on sale of vessels and equipment - - 282
Amortization of in-process revenue
contracts and other - - (5,943)
Realized losses from the settlements
of non-designated foreign derivative
instruments - - (1,497)
----------------------------------------------------------------------------
Cash flow from vessel operations -
Teekay Parent 1,549 (5,067) 18,077
----------------------------------------------------------------------------
----------------------------------------------------------------------------
-----------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX E - RECONCILIATION OF NON-GAAP MEASURES
CASH FLOW FROM VESSEL OPERATIONS - TEEKAY PARENT
(in thousands of U.S. dollars)
(unaudited)
Set forth below is an unaudited calculation of Teekay Parent cash flow
from vessel operations for the three months ended December 31, 2014,
September 30, 2014, June 30, 2014, and March 31, 2014. CFVO, a non-
GAAP financial measure, represents income from vessel operations
before depreciation and amortization expense, amortization of in-
process revenue contracts, vessel write-downs, gains or losses on the
sale of vessels, and adjustments for direct financing leases to a
cash basis, but includes realized gains or losses on the settlement
of foreign exchange forward contracts and a derivative charter
contract. 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 or
any other indicator of the Company's performance required by GAAP.
-----------------------------------------------------------------------
Three Months Ended
December 31, 2014
(unaudited)
Teekay
Corporate Parent
Other G&A Total
-----------------------------------------------------------------------
Teekay Parent income (loss) from
vessel operations 7,272 (3,767) 3,655
Depreciation and amortization (113) - 21,454
Loss on sale of vessels and equipment - - 282
Amortization of in-process revenue
contracts and other - - (5,943)
Realized losses from the settlements
of non-designated foreign derivative
instruments - - (1,497)
-----------------------------------------------------------------------
Cash flow from vessel operations -
Teekay Parent 7,159 (3,767) 17,951
-----------------------------------------------------------------------
-----------------------------------------------------------------------
Three Months Ended
September 30, 2014
(unaudited)
Owned In-chartered
Conventional Conventional
Tankers Tankers FPSOs
----------------------------------------------------------------------------
Teekay Parent (loss) income from
vessel operations (447) (4,441) (23,208)
Depreciation and amortization 713 - 21,145
Gain on sale of vessels and equipment - - (1,217)
Amortization of in-process revenue
contracts and other - - (6,580)
Realized gains (losses) from the
settlements of non-designated
foreign derivative instruments 11 - (167)
----------------------------------------------------------------------------
Cash flow from vessel operations -
Teekay Parent 277 (4,441) (10,027)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended
September 30, 2014
(unaudited)
Teekay
Corporate Parent
Other G&A Total
----------------------------------------------------------------------
Teekay Parent (loss) income from
vessel operations 12,083 (4,068) (20,081)
Depreciation and amortization (542) - 21,316
Gain on sale of vessels and equipment (7,285) - (8,802)
Amortization of in-process revenue
contracts and other - - (6,580)
Realized gains (losses) from the
settlements of non-designated
foreign derivative instruments - - (156)
----------------------------------------------------------------------
Cash flow from vessel operations -
Teekay Parent 4,256 (4,068) (14,003)
----------------------------------------------------------------------
----------------------------------------------------------------------
Three Months Ended
June 30, 2014
(unaudited)
Owned In-chartered
Conventional Conventional
Tankers Tankers FPSOs
----------------------------------------------------------------------------
Teekay Parent (loss) income from
vessel operations (161) (4,818) (34,843)
Depreciation and amortization 710 - 18,296
Loan loss recoveries - - (2,521)
Loss on sale of vessels and equipment 340 - -
Amortization of in-process revenue
contracts and other - - (6,580)
Realized losses from the settlements
of non-designated foreign derivative
instruments (34) - (52)
----------------------------------------------------------------------------
Cash flow from vessel operations -
Teekay Parent 855 (4,818) (25,700)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended
June 30, 2014
(unaudited)
Teekay
Corporate Parent
Other G&A Total
----------------------------------------------------------------------
Teekay Parent (loss) income from
vessel operations 9,810 (3,362) (33,374)
Depreciation and amortization (62) - 18,944
Loan loss recoveries - - (2,521)
Loss on sale of vessels and equipment - - 340
Amortization of in-process revenue
contracts and other - - (6,580)
Realized losses from the settlements
of non-designated foreign derivative
instruments - - (86)
----------------------------------------------------------------------
Cash flow from vessel operations -
Teekay Parent 9,748 (3,362) (23,277)
----------------------------------------------------------------------
----------------------------------------------------------------------
Three Months Ended
March 31, 2014
(unaudited)
Owned In-chartered
Conventional Conventional
Tankers Tankers FPSOs
----------------------------------------------------------------------------
Teekay Parent income (loss) from
vessel operations 4,510 (2,819) (25,135)
Depreciation and amortization 80 - 18,335
Loss on sale of vessels and equipment 162 - -
Amortization of in-process revenue
contracts and other - - (6,580)
Realized losses from the settlements
of non-designated foreign derivative
instruments (262) - (526)
----------------------------------------------------------------------------
Cash flow from vessel operations -
Teekay Parent 4,490 (2,819) (13,906)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended
March 31, 2014
(unaudited)
Teekay
Corporate Parent
Other G&A Total
----------------------------------------------------------------------
Teekay Parent income (loss) from
vessel operations 12,465 (5,658) (16,638)
Depreciation and amortization (57) - 18,358
Loss on sale of vessels and equipment - - 162
Amortization of in-process revenue
contracts and other - (6,580)
Realized losses from the settlements
of non-designated foreign derivative
instruments - (788)
----------------------------------------------------------------------
Cash flow from vessel operations -
Teekay Parent 12,408 (5,658) (5,486)
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX E - RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
NET REVENUES
(in thousands of U.S. dollars)
(unaudited)
Set forth below is an unaudited calculation of net revenues for the
three months ended March 31, 2015 and March 31, 2014. Net revenues
represents revenues less voyage expenses, which comprise all expenses
relating to certain voyages, including bunker fuel expenses, port
fees, cargo loading and unloading expenses, canal tolls, agency fees
and commissions. Net revenues is included because certain investors
use this data to measure the financial performance of shipping
companies.Net revenues is not required by GAAP and should not be
considered as an alternative to revenues or any other indicator of
the Company's performance required by GAAP.
----------------------------------------------------------------------
Three Months Ended March 31, 2015
---------------------------------
Teekay Teekay Teekay
Offshore LNG Tankers
----------------------------------------------------------------------
Revenues 250,911 97,326 103,878
Voyage expense (22,517) (318) (3,834)
----------------------------------------------------------------------
Net revenues 228,394 97,008 100,044
----------------------------------------------------------------------
----------------------------------------------------------------------
Three Months Ended March 31, 2014
---------------------------------
Teekay Teekay Teekay
Offshore LNG Tankers
----------------------------------------------------------------------
Revenues 259,234 101,490 61,759
Voyage expense (33,454) (1,333) (1,439)
----------------------------------------------------------------------
Net revenues 225,780 100,157 60,320
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX E - RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
NET REVENUES
(in thousands of U.S. dollars)
(unaudited)
Set forth below is an unaudited calculation of net revenues for the three
months ended March 31, 2015 and March 31, 2014. Net revenues represents
revenues less voyage expenses, which comprise all expenses relating to
certain voyages, including bunker fuel expenses, port fees, cargo loading
and unloading expenses, canal tolls, agency fees and commissions. Net
revenues is included because certain investors use this data to measure
the financial performance of shipping companies.Net revenues is not
required by GAAP and should not be considered as an alternative to
revenues or any other indicator of the Company's performance required by
GAAP.
----------------------------------------------------------------------------
Three Months Ended March 31, 2015
---------------------------------------
Teekay
Teekay Consolidation Corporation
Parent Adjustments Consolidated
----------------------------------------------------------------------------
Revenues 118,238 (24,491) 545,862
Voyage expense (87) 1,086 (25,670)
----------------------------------------------------------------------------
Net revenues 118,151 (23,405) 520,192
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended March 31, 2014
---------------------------------------
Teekay
Teekay Consolidation Corporation
Parent Adjustments Consolidated
----------------------------------------------------------------------------
Revenues 112,505 (28,494) 506,494
Voyage expense (756) 1,970 (35,012)
----------------------------------------------------------------------------
Net revenues 111,749 (26,524) 471,482
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX E - RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
NET INTEREST EXPENSE - TEEKAY PARENT
(in thousands of U.S. dollars)
(unaudited)
Set forth below is an unaudited calculation of Teekay Parent net interest
expense for the three months ended March 31, 2015, December 31, 2014,
September 30, 2014, June 30, 2014, and March 31, 2014. Net interest
expense is a non-GAAP financial measure that includes realized gains and
losses on interest rate swaps. Net interest expense is not required by
GAAP and should not be considered as an alternative to interest expense or
any other indicator of the Company's performance required by GAAP.
----------------------------------------------------------------------------
Three Months Ended
March 31, December 31, September 30, June 30, March 31,
2015 2014 2014 2014 2014
---------------------------------------------------------
Interest expense (51,346) (57,334) (52,206) (49,656) (49,333)
Interest income 1,530 1,465 2,786 793 1,783
----------------------------------------------------------------------------
Net interest
expense -
consolidated (49,816) (55,869) (49,420) (48,863) (47,550)
Less:
Non-Teekay Parent
net interest
expense (34,753) (42,279) (37,944) (38,088) (35,135)
----------------------------------------------------------------------------
Interest expense
net of interest
income - Teekay
Parent (15,063) (13,590) (11,476) (10,775) (12,415)
Add:
Teekay Parent
realized losses
on interest rate
swaps (1) (2,471) (1,466) (1,524) (4,240) (3,736)
----------------------------------------------------------------------------
Net interest
expense - Teekay
Parent (17,534) (15,056) (13,000) (15,015) (16,151)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Teekay Parent realized losses on interest rate swaps exclude realized
losses on the interest rate swap related to the debt facility secured by the
Knarr FPSO unit up to commencement of operations on March 9, 2015 of $3.3
million for the three months ended March 31, 2015, $5.3 million for the
three months ended December 31, 2014 and $4.1 million for the three months
ended September 30, 2014 and exclude a realized gain on the termination of a
swap agreement of $1.0 million for the three months ended March 31, 2014.
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 and cash flows; the timing for implementation of the Company's new dividend policy, the initial dividend increase, and expectations for future dividend increases by Teekay Parent and distribution increases by its daughter entities; the sale of the Knarr FPSO, including the sales price, the timing of completion of testing and contract start-up at full rate for this FPSO unit, the timing of Teekay Offshore's acquisition, and the consideration for the acquisition; the start-up date of the shuttle tanker CoA contract with EnQuest PLC., including the required roundtrip voyages; the dividend contributions of any future projects awarded to the Company's daughter companies; the total cost and timing for the delivery of newbuilding and conversion projects and timing of commencement of associated time-charter contracts; the timing and certainty of securing charter contracts for unchartered vessels or offshore units; ALP's position as the world's largest owner and operator of dynamic positioning towing and offshore installation vessels, and the capabilities of those vessels; the timing and certainty of exercising any of Teekay LNG's existing options to order up to four additional MEGI LNG carrier newbuildings; expected fuel-efficiency and emission levels associated with MEGI engines; the outcome of Teekay LNG's dispute over the Magellan Spirit off-hire incident and claimed charter contract termination, as well as the expected insurance coverage; the timing, certainty and purchase price of pending and future vessel acquisitions; timing of delivery of a charter-in tanker. The following factors are among those that could cause actual results to differ materially from the forward-looking statements, which involve risks and uncertainties, and that should be considered in evaluating any such statement:
changes in production of or demand for oil, petroleum products, LNG and LPG, either generally or in particular regions; greater or less than anticipated levels of newbuilding orders or greater or less than anticipated rates of vessel scrapping; changes in trading patterns significantly affecting overall vessel tonnage requirements; changes in applicable industry laws and regulations and the timing of implementation of new laws and regulations; changes in the typical seasonal variations in tanker charter rates; changes in the offshore production of oil or demand for shuttle tankers, FSO and FPSO units; decreases in oil production by, or increased operating expenses for, FPSO units; fluctuations in global oil prices; trends in prevailing charter rates for shuttle tanker and FPSO contract renewals; the potential for early termination of long-term contracts and inability of the Company to renew or replace long-term contracts or complete existing contract negotiations; delays in commencement of operations of FPSO and FSO units at designated fields; changes in the Company's expenses; the Company and its publicly-traded subsidiaries' future capital expenditure requirements and the inability to secure financing for such requirements; the amount of future distributions by the Company's daughter companies to the Company; failure by Teekay Offshore and Teekay LNG to complete its vessel acquisitions; actual performance of the MEGI engines; failure by the Company or its daughter companies to secure charter contracts for unchartered vessels or offshore units; factors affecting the outcome of the Partnership's dispute over the Magellan Spirit; potential delays in the commencement of full operations
of the Knarr FPSO unit; the inability of the Company to complete vessel sale transactions to its publicly-traded subsidiaries or to third parties, including obtaining Board of Directors and Conflicts Committee approvals; failure by the Company's Board of Directors to approve the implementation of the new Teekay Parent dividend policy in the second quarter of 2015, including the initial dividend increase; failure of the respective Board of Directors of the general partners of Teekay Offshore and Teekay LNG to approve future distribution increases; conditions in the United States capital markets; 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, 2014. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company's expectations with respect thereto or any change in events, conditions or circumstances on which any such statement is based.
Contacts: For Investor Relations Enquiries Ryan Hamilton +1 (604) 844-6654 www.teekay.com
Source: Teekay Corporation