Highlights
- GAAP net loss attributable to shareholders of Teekay of
$35.4 million , or$0.35 per share (inclusive of$66.3 million of impairment charges), and adjusted net income attributable to shareholders of Teekay(1) of$15.2 million , or$0.15 per share, in the third quarter of 2020 (excluding items listed in Appendix A to this release). - Total adjusted EBITDA(1) of
$227.0 million in the third quarter of 2020, an 18 percent increase over the same period of the prior year. - Reduced consolidated net debt by
$88 million in the third quarter of 2020; and total pro forma consolidated liquidity increased to$1.1 billion (2) as ofSeptember 30, 2020 . - Teekay Parent is nearing completion of Phase I of the Banff FPSO decommissioning project according to plan; repurchased
$14.4 million in principal amount of its existing convertible bond and secured bond at average prices of 81.55 and 92.23, respectively; and completed$150 million refinancing of equity margin revolver. Teekay LNG extended a charter contract to early-2022 for a 52 percent-owned LNG carrier; LNG fleet is now 100 percent fixed for the remainder of 2020 and 96 percent fixed for 2021.Teekay Tankers secured a new time charter-out contract for an Aframax tanker and currently has 20 percent of its existing fleet on fixed-rate charters at levels well above current market rates.
Financial Summary
Three Months Ended | ||||||
2020 | 2020 | 2019(3) | ||||
(in thousands of | (unaudited) | (unaudited) | (unaudited) | |||
TEEKAY CORPORATION CONSOLIDATED | ||||||
GAAP FINANCIAL COMPARISON | ||||||
Revenues | 396,517 | 482,805 | 425,836 | |||
Income (loss) from vessel operations | 11,384 | 148,504 | (130,389 | ) | ||
Equity income | 24,392 | 35,343 | 21,514 | |||
Net (loss) income attributable to | ||||||
shareholders of Teekay | (35,407 | ) | 21,723 | (198,178 | ) | |
(Loss) earnings per share attributable to | ||||||
shareholders of Teekay | (0.35 | ) | 0.21 | (1.97 | ) | |
NON-GAAP FINANCIAL COMPARISON | ||||||
Total adjusted revenues (1) | 498,115 | 592,658 | 511,825 | |||
Total adjusted EBITDA (1) | 226,998 | 315,869 | 192,880 | |||
Adjusted net income (loss) attributable | ||||||
to shareholders of Teekay (1) | 15,229 | 39,713 | (24,070 | ) | ||
Adjusted net income (loss) per share | ||||||
attributable to shareholders of Teekay (1) | 0.15 | 0.39 | (0.24 | ) | ||
TEEKAY PARENT | ||||||
NON-GAAP FINANCIAL COMPARISON | ||||||
Teekay Parent adjusted EBITDA (1) | 3,271 | 9,694 | (10,068 | ) | ||
Total Teekay Parent free cash flow (1) | (17,135 | ) | (1,908 | ) | (18,782 | ) |
(1) | These are non-GAAP financial measures. Please refer to “Definitions and Non-GAAP Financial Measures” and the Appendices to this release for definitions of these terms and reconciliations of these non-GAAP financial measures as used in this release to the most directly comparable financial measures under | |
(2) | Pro forma for Teekay Parent's equity margin revolver refinancing completed in | |
(3) | Comparative balances relating to the three months ended |
CEO Commentary
“In the third quarter of 2020, we reported another adjusted profit, with adjusted net income of approximately
“Teekay LNG, which accounted for approximately 82 percent of our total adjusted EBITDA in the third quarter of 2020, generated strong earnings and cash flows despite a heavy scheduled drydock program.
“We have continued to increase our financial strength across the Teekay group,” added
(1) | Pro forma for Teekay Parent's equity margin revolver refinancing completed on |
Summary of Results
Teekay Corporation Consolidated
The Company's consolidated results during the third quarter of 2020 improved compared to the same period of the prior year, primarily due to: higher revenues from
In addition, consolidated GAAP net loss decreased as the Company recognized fewer impairment charges in the third quarter of 2020, including write-downs totaling
Teekay Parent
Total Teekay Parent Free Cash Flow(1) was negative
Please refer to Appendix D of this release for additional information about Teekay Parent's Free Cash Flow(1).
(1) | This is a non-GAAP financial measure. Please refer to “Definitions and Non-GAAP Financial Measures” and the Appendices to this release for a definition of this term and a reconciliation of this non-GAAP financial measure as used in this release to the most directly comparable financial measures under GAAP. |
Summary Results of Daughter Entities
Teekay LNG’s net income, adjusted net income(1) and total adjusted EBITDA(1) for the third quarter of 2020, compared to the same quarter of the prior year, were positively impacted by: additional earnings from the delivery and contract start-up of three 50 percent-owned LNG carrier newbuildings in late-2019 and the commencement of terminal use payments to the
In addition,
Please refer to
Following three strong quarters, spot tanker rates came under pressure during the third quarter of 2020 as a result of seasonal weakness, lower oil demand, record OPEC+ production cuts, and the unwinding of floating storage.
Please refer to
(1) | This is a non-GAAP financial measure. Please refer to “Definitions and Non-GAAP Financial Measures” and the Appendices to this release for a definition of this term and a reconciliation of this non-GAAP financial measure as used in this release to the most directly comparable financial measures under GAAP. |
Summary of Recent Events
Teekay Parent
In
Since
In
In
In
In
In
Liquidity
As at
On a consolidated basis, as at
Conference Call
The Company plans to host a conference call on
- By dialing (800) 367-2403 or (647) 490-5367, if outside
North America , and quoting conference ID code 9588810.
- By accessing the webcast, which will be available on Teekay’s website at www.teekay.com (the archive will remain on the website for a period of one year).
An accompanying Third Quarter 2020 Earnings Presentation will also be available at www.teekay.com in advance of the conference call start time.
About Teekay
Teekay is a leading provider of international crude oil and gas marine transportation services. Teekay provides these services primarily through its directly-owned fleet and its controlling ownership interests in
Teekay’s common stock is listed on the
For Investor Relations enquiries contact:
Tel: +1 (604) 609-2963
Website: www.teekay.com
Definitions and Non-GAAP Financial Measures
This release includes various financial measures that are non-GAAP financial measures as defined under the rules of the
Non-GAAP Financial Measures
Total Adjusted EBITDA represents net income (loss) before interest, taxes, depreciation and amortization, and is adjusted to exclude certain items whose timing or amount cannot be reasonably estimated in advance or that are not considered representative of core operating performance. Such adjustments include foreign currency exchange gains and losses, any write-downs and/or gains and losses on sale of operating assets, adjustments for direct financing and sales-type leases to a cash basis, amortization of in-process revenue contracts, unrealized gains and losses on derivative instruments, credit loss provision adjustments, write-downs related to equity-accounted investments, our share of the above items in non-consolidated joint ventures which are accounted for using the equity method of accounting, and other income or loss. Total Adjusted EBITDA also excludes realized gains or losses on interest rate swaps as management, in assessing the Company's performance, views these gains or losses as an element of interest expense and realized gains or losses on derivative instruments resulting from amendments or terminations of the underlying instruments.
Consolidated Adjusted EBITDA represents Adjusted EBITDA from vessels that are consolidated on the Company's financial statements. Adjusted EBITDA from Equity-Accounted Vessels represents the Company's proportionate share of Adjusted EBITDA from its equity-accounted vessels. The Company does not have the unilateral ability to determine whether the cash generated by its equity-accounted vessels is retained within the entity in which the Company holds the equity-accounted investments or distributed to the Company and other owners. In addition, the Company does not control the timing of any such distributions to the Company and other owners. Total Adjusted EBITDA represents Consolidated Adjusted EBITDA plus Adjusted EBITDA from
Total Adjusted Revenues represents the Company's revenues from its consolidated vessels, as shown in the Company's Consolidated Statements of (Loss) Income, and its proportionate ownership percentage of the revenues from its equity-accounted joint ventures, as shown in Appendix E of this release, and commencing in 2020, less the Company's proportionate share of revenues earned directly from its equity-accounted joint ventures. Please refer to Appendix E of this release for a reconciliation of this non-GAAP financial measure to revenues and equity income, the most directly comparable GAAP measure reflected in the Company's consolidated financial statements. The Company does not have the unilateral ability to determine whether the cash generated by its equity-accounted vessels is retained within the entity in which the Company holds the equity-accounted investments or distributed to the Company and other owners. In addition, the Company does not control the timing of any such distributions to the Company and other owners.
Adjusted Net Income (Loss) Attributable to Shareholders of Teekay excludes items of income or loss from GAAP net income (loss) that are typically excluded by securities analysts in their published estimates of the Company’s financial results. The Company believes that certain investors use this information to evaluate the Company’s financial performance, as does management. Please refer to Appendix A of this release for a reconciliation of this non-GAAP financial measure to net (loss) income, and refer to footnote (6) of the statements of (loss) income for a reconciliation of adjusted equity income to equity income (loss), the most directly comparable GAAP measure reflected in the Company’s consolidated financial statements.
Teekay Parent Financial Measures
Teekay Parent Adjusted EBITDA represents the sum of (a) distributions or dividends (including payments-in-kind) relating to a given quarter (but received by Teekay Parent in the following quarter) as a result of ownership interests in its consolidated publicly-traded subsidiaries (
Teekay Parent Free Cash Flow represents Teekay Parent Adjusted EBITDA, less Teekay Parent’s net interest expense and, commencing in the second quarter of 2020, asset retirement costs incurred for the given quarter. Net Interest Expense includes interest expense (excluding the amortization of prepaid loan costs), interest income and realized losses on interest rate swaps. Please refer to Appendices B, C, D and E of this release for further details and reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures reflected in the Company’s consolidated financial statements.
Summary Consolidated Statements of (Loss) Income
(in thousands of
Three Months Ended | Nine Months Ended | ||||||||||||||
2020 | 2020 | 2019 (1) | 2020 | 2019 (1) | |||||||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||||||
Revenues | 396,517 | 482,805 | 425,836 | 1,453,376 | 1,375,106 | ||||||||||
Voyage expenses | (61,736 | ) | (66,896 | ) | (97,829 | ) | (250,196 | ) | (310,022 | ) | |||||
Vessel operating expenses | (153,764 | ) | (147,796 | ) | (159,616 | ) | (454,853 | ) | (479,229 | ) | |||||
Time-charter hire expense | (18,796 | ) | (17,714 | ) | (28,932 | ) | (63,566 | ) | (87,587 | ) | |||||
Depreciation and amortization | (64,352 | ) | (62,936 | ) | (73,633 | ) | (200,205 | ) | (219,589 | ) | |||||
General and administrative expenses | (18,073 | ) | (23,668 | ) | (20,016 | ) | (60,018 | ) | (63,856 | ) | |||||
Write-down and (loss) gain on sale of assets (2) | (66,273 | ) | (10,669 | ) | (175,785 | ) | (171,548 | ) | (179,113 | ) | |||||
Gain on commencement of sales-type lease (3) | — | — | — | 44,943 | — | ||||||||||
Restructuring charges (4) | (2,139 | ) | (4,622 | ) | (414 | ) | (9,149 | ) | (10,404 | ) | |||||
Income (loss) from vessel operations | 11,384 | 148,504 | (130,389 | ) | 288,784 | 25,306 | |||||||||
Interest expense | (53,175 | ) | (59,245 | ) | (67,707 | ) | (174,940 | ) | (211,583 | ) | |||||
Interest income | 1,754 | 2,314 | 1,485 | 6,871 | 6,407 | ||||||||||
Realized and unrealized losses on non-designated | |||||||||||||||
derivative instruments (5) | (1,471 | ) | (9,270 | ) | (1,924 | ) | (32,404 | ) | (18,311 | ) | |||||
Equity income (loss) (6) | 24,392 | 35,343 | 21,514 | 62,048 | (46,423 | ) | |||||||||
Income tax (expense) recovery (7) | (3,702 | ) | 17,175 | (3,091 | ) | 9,681 | (11,531 | ) | |||||||
Foreign exchange (loss) gain | (5,943 | ) | (8,922 | ) | 5,628 | (8,219 | ) | (2,853 | ) | ||||||
Other loss – net (8) | (14,627 | ) | (399 | ) | (1,424 | ) | (15,707 | ) | (12,495 | ) | |||||
Net (loss) income | (41,388 | ) | 125,500 | (175,908 | ) | 136,114 | (271,483 | ) | |||||||
Net loss (income) attributable to | |||||||||||||||
non-controlling interests | 5,981 | (103,777 | ) | (22,270 | ) | (199,603 | ) | (50,437 | ) | ||||||
Net (loss) income attributable to the shareholders | |||||||||||||||
of | (35,407 | ) | 21,723 | (198,178 | ) | (63,489 | ) | (321,920 | ) | ||||||
Earnings (loss) per common share of | |||||||||||||||
- Basic | $ | (0.35 | ) | $ | 0.21 | $ | (1.97 | ) | $ | (0.63 | ) | $ | (3.20 | ) | |
- Diluted | $ | (0.35 | ) | $ | 0.21 | $ | (1.97 | ) | $ | (0.63 | ) | $ | (3.20 | ) | |
Weighted-average number of common shares outstanding | |||||||||||||||
- Basic | 101,107,371 | 101,107,362 | 100,784,683 | 101,034,362 | 100,697,251 | ||||||||||
- Diluted | 101,107,371 | 101,196,383 | 100,784,683 | 101,034,362 | 100,697,251 |
(1) | Comparative balances relating to the three and nine months ended | |
(2) | Write-down and (loss) gain on sale of assets for the three and nine months ended | |
(3) | Gain on commencement of sales-type lease of | |
(4) | Restructuring charges for the three and nine months ended | |
(5) | Realized and unrealized losses related to derivative instruments that are not designated in qualifying hedging relationships for accounting purposes are included as a separate line item in the consolidated statements of (loss) income. The realized losses relate to the amounts the Company actually paid to settle such derivative instruments and the unrealized gains (losses) relate to the change in fair value of such derivative instruments, as detailed in the table below: |
Three Months Ended | Nine Months Ended | |||||||||
2020 | 2020 | 2019 | 2020 | 2019 | ||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | ||||||
Realized (losses) gains relating to | ||||||||||
Interest rate swap agreements | (5,349 | ) | (3,879 | ) | (2,247 | ) | (11,905 | ) | (5,720 | ) |
Stock purchase warrants (i) | — | — | — | — | (25,559 | ) | ||||
Foreign currency forward contracts | 379 | — | — | 138 | — | |||||
Forward freight agreements | (183 | ) | (201 | ) | 435 | (433 | ) | 393 | ||
(5,153 | ) | (4,080 | ) | (1,812 | ) | (12,200 | ) | (30,886 | ) | |
Unrealized gains (losses) relating to | ||||||||||
Interest rate swap agreements | 3,956 | (5,251 | ) | (623 | ) | (20,107 | ) | (14,839 | ) | |
Foreign currency forward contracts | (53 | ) | 53 | (435 | ) | 202 | (536 | ) | ||
Stock purchase warrants (i) | — | — | — | — | 26,900 | |||||
Forward freight agreements | (221 | ) | 8 | 946 | (299 | ) | 1,050 | |||
3,682 | (5,190 | ) | (112 | ) | (20,204 | ) | 12,575 | |||
Total realized and unrealized losses on derivative instruments | (1,471 | ) | (9,270 | ) | (1,924 | ) | (32,404 | ) | (18,311 | ) |
(i) | Stock purchase warrants for the nine months ended |
(6) | The Company’s proportionate share of items within equity income (loss) as identified in Appendix A of this release is detailed in the table below. By excluding these items from equity income (loss) as reflected in the consolidated statements of (loss) income , the Company believes the resulting adjusted equity income is a normalized amount that can be used to evaluate the financial performance of the Company’s equity-accounted investments. Adjusted equity income is a non-GAAP financial measure. |
Three Months Ended | Nine Months Ended | ||||||||
2020 | 2020 | 2019 | 2020 | 2019 | |||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||
Equity income (loss) | 24,392 | 35,343 | 21,514 | 62,048 | (46,423 | ) | |||
Proportionate share of unrealized (gains) | |||||||||
losses on derivative instruments | (2,680 | ) | 3,806 | 5,170 | 23,330 | 19,138 | |||
Loss on sale of investment in Altera (i) | — | — | — | — | 72,753 | ||||
Other (ii) | 8,266 | (61 | ) | (150 | ) | 16,646 | 873 | ||
Equity income adjusted for items in Appendix A | 29,978 | 39,088 | 26,534 | 102,024 | 46,341 |
(i) | During the nine months ended | ||
(ii) | Other for the three and nine months ended |
(7) | Income tax (expense) recovery for the three months ended | |
(8) | Other loss - net for the three and nine months ended |
Summary Consolidated Balance Sheets
(in thousands of
As at | As at | As at | ||
2020 | 2020 | 2019 | ||
(unaudited) | (unaudited) | (unaudited) | ||
ASSETS | ||||
Cash and cash equivalents - Teekay Parent | 54,655 | 66,917 | 104,196 | |
Cash and cash equivalents - | 201,036 | 226,328 | 160,221 | |
Cash and cash equivalents - | 120,872 | 167,907 | 88,824 | |
Assets held for sale | — | — | 65,458 | |
Accounts receivable and other current assets | 274,408 | 318,726 | 393,406 | |
Restricted cash - Teekay Parent | 4,060 | 3,915 | 2,048 | |
Restricted cash - | 53,801 | 66,147 | 93,070 | |
Restricted cash - | 8,123 | 8,203 | 6,508 | |
Vessels and equipment - Teekay Parent | — | 13,964 | 95,984 | |
Vessels and equipment - | 2,908,182 | 2,931,602 | 3,027,342 | |
Vessels and equipment - | 1,616,518 | 1,672,976 | 1,750,166 | |
Operating lease right-of-use assets | 61,796 | 81,255 | 159,638 | |
Net investment in direct financing and sales-type leases | 537,142 | 554,986 | 818,809 | |
Investments in and loans to equity-accounted investments | 1,111,660 | 1,102,386 | 1,173,728 | |
Other non-current assets | 128,867 | 130,200 | 133,466 | |
Total Assets | 7,081,120 | 7,345,512 | 8,072,864 | |
LIABILITIES AND EQUITY | ||||
Accounts payable and other current liabilities | 461,664 | 441,857 | 430,497 | |
Liabilities related to assets held for sale | — | — | 2,980 | |
Short-term debt - | 20,000 | 10,000 | 50,000 | |
Current portion of long-term debt - Teekay Parent | — | — | 86,674 | |
Current portion of long-term debt - | 363,161 | 366,237 | 463,047 | |
Current portion of long-term debt - | 37,756 | 53,830 | 68,930 | |
Long-term debt - Teekay Parent | 346,178 | 354,065 | 349,403 | |
Long-term debt - | 2,488,953 | 2,568,258 | 2,779,253 | |
Long-term debt - | 573,381 | 661,627 | 905,537 | |
Operating lease liabilities | 63,529 | 72,982 | 148,602 | |
Other long-term liabilities | 196,568 | 229,415 | 216,348 | |
Equity: | ||||
Non-controlling interests | 2,033,112 | 2,058,273 | 2,089,730 | |
Shareholders of Teekay | 496,818 | 528,968 | 481,863 | |
Total Liabilities and Equity | 7,081,120 | 7,345,512 | 8,072,864 | |
Net debt - Teekay Parent (1) | 287,463 | 283,233 | 329,833 | |
Net debt - | 2,597,277 | 2,642,020 | 2,989,009 | |
Net debt - | 502,142 | 549,347 | 929,135 |
(1) | Net debt is a non-GAAP financial measure and represents short-term debt, current portion of long-term debt and long-term debt, less cash and cash equivalents, and, if applicable, restricted cash. |
Summary Consolidated Statements of Cash Flows
(in thousands of
Nine Months Ended | ||||
2020 | 2019 | |||
(unaudited) | (unaudited) | |||
Cash, cash equivalents and restricted cash provided by (used for) | ||||
OPERATING ACTIVITIES | ||||
Net income (loss) | 136,114 | (271,483 | ) | |
Non-cash and non-operating items: | ||||
Depreciation and amortization | 200,205 | 219,589 | ||
Unrealized loss on derivative instruments | 22,373 | 38,803 | ||
Write-down and loss on sale | 171,548 | 179,113 | ||
Gain on commencement of sales-type lease | (44,943 | ) | — | |
Equity (income) loss, net of dividends received | (29,751 | ) | 71,797 | |
Foreign currency exchange loss and other | 33,747 | 13,602 | ||
Direct financing lease payments received | 337,363 | 9,242 | ||
Change in operating assets and liabilities | 92,310 | 41,729 | ||
Asset retirement obligation expenditures | (15,207 | ) | — | |
Expenditures for dry docking | (9,623 | ) | (46,266 | ) |
Net operating cash flow | 894,136 | 256,126 | ||
FINANCING ACTIVITIES | ||||
Proceeds from issuance of long-term debt, net of issuance costs | 1,109,267 | 449,686 | ||
Prepayments of long-term debt | (1,639,223 | ) | (774,401 | ) |
Scheduled repayments of long-term debt | (267,953 | ) | (171,946 | ) |
Proceeds from short-term debt | 235,000 | 125,000 | ||
Prepayment of short-term debt | (265,000 | ) | (75,000 | ) |
Proceeds from financing related to sales-leaseback of vessels | — | 381,526 | ||
Prepayment of obligations related to finance leases | — | (111,617 | ) | |
Repayments of obligations related to finance leases | (71,135 | ) | (72,559 | ) |
Repurchase of | (15,635 | ) | (25,729 | ) |
Distributions paid from subsidiaries to non-controlling interests | (58,081 | ) | (46,982 | ) |
Cash dividends paid | — | (5,523 | ) | |
Other financing activities | (798 | ) | (580 | ) |
Net financing cash flow | (973,558 | ) | (328,125 | ) |
INVESTING ACTIVITIES | ||||
Expenditures for vessels and equipment | (18,468 | ) | (98,713 | ) |
Proceeds from sale of vessels and equipment | 60,915 | — | ||
Proceeds from sale of assets, net of cash sold | 24,977 | 100,000 | ||
Loan repayment by joint venture | 4,650 | — | ||
Investment in equity-accounted investments | — | (42,171 | ) | |
Other investing activities | (6,430 | ) | — | |
Net investing cash flow | 65,644 | (40,884 | ) | |
Decrease in cash, cash equivalents and restricted cash | (13,778 | ) | (112,883 | ) |
Cash, cash equivalents and restricted cash, beginning of the period | 456,325 | 505,639 | ||
Cash, cash equivalents and restricted cash, end of the period | 442,547 | 392,756 |
Appendix A - Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Loss)
(in thousands of
Three Months Ended | Nine Months Ended | |||||||||||
2020 | 2020 | 2020 | ||||||||||
(unaudited) | (unaudited) | (unaudited) | ||||||||||
$ Per | $ Per | $ Per | ||||||||||
$ | Share(1) | $ | Share(1) | $ | Share(1) | |||||||
Net (loss) income – GAAP basis | (41,388 | ) | 125,500 | 136,114 | ||||||||
Adjust for: Net loss (income) attributable to | ||||||||||||
non-controlling interests | 5,981 | (103,777 | ) | (199,603 | ) | |||||||
Net (loss) income attributable to | ||||||||||||
shareholders of Teekay | (35,407 | ) | (0.35 | ) | 21,723 | 0.21 | (63,489 | ) | (0.63 | ) | ||
Add (subtract) specific items affecting net loss | ||||||||||||
Unrealized (gains) losses from | ||||||||||||
derivative instruments(2) | (6,362 | ) | (0.06 | ) | 8,995 | 0.09 | 43,533 | 0.43 | ||||
Foreign currency exchange losses (3) | 4,275 | 0.04 | 7,492 | 0.07 | 3,304 | 0.03 | ||||||
Banff FPSO decommissioning costs | ||||||||||||
net of recoveries(4) | 10,564 | 0.10 | 5,854 | 0.06 | 16,418 | 0.16 | ||||||
Write-down and (loss) gain on sale | ||||||||||||
of vessels and other assets(5) | 66,872 | 0.66 | 10,669 | 0.11 | 172,147 | 1.70 | ||||||
Gain on commencement of sales-type lease(6) | — | — | — | — | (44,943 | ) | (0.44 | ) | ||||
Restructuring charges, net of recoveries | 1,186 | 0.01 | 112 | — | 2,486 | 0.02 | ||||||
Other(7) | 22,657 | 0.22 | (17,598 | ) | (0.17 | ) | 13,289 | 0.13 | ||||
Non-controlling interests’ share of items above(8) | (48,556 | ) | (0.48 | ) | 2,466 | 0.02 | (62,544 | ) | (0.62 | ) | ||
Total adjustments | 50,636 | 0.49 | 17,990 | 0.18 | 143,690 | 1.42 | ||||||
Adjusted net income attributable to | ||||||||||||
shareholders of Teekay | 15,229 | 0.15 | 39,713 | 0.39 | 80,201 | 0.79 |
(1) | Basic per share amounts. | |
(2) | Reflects unrealized gains (losses) relating to the change in the mark-to-market value of derivative instruments that are not designated in qualifying hedging relationships for accounting purposes, including those gains (losses) included in the Company's proportionate share of equity income (loss) from joint ventures. | |
(3) | Foreign currency exchange losses (gains) primarily relate to the Company’s debt denominated in Euros and Norwegian Kroner (NOK) and unrealized losses on cross currency swaps used to economically hedge the principal and interest on NOK bonds. | |
(4) | In the first quarter of 2020, | |
(5) | Refer to footnote (2) of the Summary Consolidated Statements of (Loss) Income for additional information. | |
(6) | Gain on commencement of sales-type lease for the nine months ended | |
(7) | Other for the three and nine months ended | |
(8) | Items affecting net income include items from the Company’s consolidated non-wholly-owned subsidiaries. The specific items affecting net income are analyzed to determine whether any of the amounts originated from a consolidated non-wholly-owned subsidiary. Each amount that originates from a consolidated non-wholly-owned subsidiary is multiplied by the non-controlling interests’ percentage share in this subsidiary to determine the non-controlling interests’ share of the amount. The amount identified as “Non-controlling interests’ share of items above” in the table above is the cumulative amount of the non-controlling interests’ proportionate share of items listed in the table. |
Appendix A - Reconciliation of Non-GAAP Financial Measures
Adjusted Net Income (Loss)
(in thousands of
Three Months Ended | Nine Months Ended | |||||||
2019 | 2019 | |||||||
(unaudited) | (unaudited) | |||||||
$ Per | $ Per | |||||||
$ | Share(1) | $ | Share(1) | |||||
Net loss – GAAP basis | (175,908 | ) | (271,483 | ) | ||||
Adjust for: Net income attributable to | ||||||||
non-controlling interests | (22,270 | ) | (50,437 | ) | ||||
Net loss attributable to | ||||||||
shareholders of Teekay | (198,178 | ) | (1.97 | ) | (321,920 | ) | (3.20 | ) |
Add (subtract) specific items affecting net loss | ||||||||
Unrealized losses from non-designated derivative instruments(2) | 5,283 | 0.05 | 6,565 | 0.07 | ||||
Foreign currency exchange gains(3) | (7,059 | ) | (0.07 | ) | (1,099 | ) | (0.01 | ) |
Write-down and (loss) gain on sale of vessels and | ||||||||
other assets(4) | 175,785 | 1.74 | 251,866 | 2.50 | ||||
Restructuring charges, net of recoveries | 414 | — | 3,941 | 0.04 | ||||
Other(5) | 1,267 | 0.01 | 40,594 | 0.40 | ||||
Non-controlling interests’ share of items above(6) | (1,582 | ) | (0.02 | ) | (30,340 | ) | (0.30 | ) |
Total adjustments | 174,108 | 1.71 | 271,527 | 2.70 | ||||
Adjusted net loss attributable to | ||||||||
shareholders of Teekay | (24,070 | ) | (0.24 | ) | (50,393 | ) | (0.50 | ) |
(1) | Basic per share amounts. | |
(2) | Reflects unrealized losses (gains) relating to the change in the mark-to-market value of derivative instruments that are not designated in qualifying hedging relationships for accounting purposes, including those losses (gains) included in the Company's proportionate share of equity income (loss) from joint ventures. | |
(3) | Foreign currency exchange (gains) losses primarily relate to the Company’s debt denominated in Euros and Norwegian Kroner (NOK) and unrealized (gains) losses on cross currency swaps used to economically hedge the principal and interest on NOK bonds. | |
(4) | Refer to footnote (2) of the Summary Consolidated Statements of (Loss) Income for additional information. | |
(5) | Other for the three and nine months ended | |
(6) | Items affecting net loss include items from the Company’s consolidated non-wholly-owned subsidiaries. The specific items affecting net loss are analyzed to determine whether any of the amounts originated from a consolidated non-wholly-owned subsidiary. Each amount that originates from a consolidated non-wholly-owned subsidiary is multiplied by the non-controlling interests’ percentage share in this subsidiary to determine the non-controlling interests’ share of the amount. The amount identified as “Non-controlling interests’ share of items above” in the table above is the cumulative amount of the non-controlling interests’ proportionate share of items listed in the table. |
Appendix B - Supplemental Financial Information
Summary Statement of Income (loss) for the Three Months Ended September 30, 2020
(in thousands of
(unaudited)
Teekay | Teekay | Teekay | Consolidation | Total | ||||||
LNG | Tankers | Parent | Adjustments(1) | |||||||
Revenues | 148,935 | 170,240 | 77,342 | — | 396,517 | |||||
Voyage expenses | (3,950 | ) | (57,777 | ) | (9 | ) | — | (61,736 | ) | |
Vessel operating expenses | (30,642 | ) | (46,336 | ) | (76,786 | ) | — | (153,764 | ) | |
Time-charter hire expense | (5,980 | ) | (9,070 | ) | (3,746 | ) | — | (18,796 | ) | |
Depreciation and amortization | (32,601 | ) | (29,992 | ) | (1,759 | ) | — | (64,352 | ) | |
General and administrative expenses | (6,165 | ) | (9,887 | ) | (2,021 | ) | — | (18,073 | ) | |
Write-down of vessels | — | (44,973 | ) | (21,300 | ) | — | (66,273 | ) | ||
Restructuring charges | — | (1,398 | ) | (741 | ) | — | (2,139 | ) | ||
Income (loss) from vessel operations | 69,597 | (29,193 | ) | (29,020 | ) | — | 11,384 | |||
Interest expense | (30,528 | ) | (12,553 | ) | (10,124 | ) | 30 | (53,175 | ) | |
Interest income | 1,406 | 337 | 41 | (30 | ) | 1,754 | ||||
Realized and unrealized (loss) gain on | ||||||||||
non-designated derivative instruments | (1,327 | ) | (414 | ) | 270 | — | (1,471 | ) | ||
Equity income | 24,346 | 46 | — | — | 24,392 | |||||
Equity in earnings of subsidiaries (2) | — | — | 1,619 | (1,619 | ) | — | ||||
Income tax expense | (1,420 | ) | (2,187 | ) | (95 | ) | — | (3,702 | ) | |
Foreign exchange (loss) gain | (7,853 | ) | (514 | ) | 2,424 | — | (5,943 | ) | ||
Other (loss) income – net | (14,149 | ) | 44 | (522 | ) | — | (14,627 | ) | ||
Net income (loss) | 40,072 | (44,434 | ) | (35,407 | ) | (1,619 | ) | (41,388 | ) | |
Net income attributable to | ||||||||||
non-controlling interests (3) | 203 | — | — | 5,778 | 5,981 | |||||
Net income (loss) attributable to shareholders/ | ||||||||||
unitholders of publicly-listed entities | 40,275 | (44,434 | ) | (35,407 | ) | 4,159 | (35,407 | ) |
(1) | Consolidation Adjustments column includes adjustments which eliminate transactions between | |
(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 |
Appendix C - Supplemental Financial Information
Teekay Parent Summary Operating Results
For the Three Months Ended
(in thousands of
(unaudited)
Teekay | ||||||||
Corporate | Parent | |||||||
FPSOs | Other(1) | G&A | Total | |||||
Revenues | 16,245 | 61,097 | — | 77,342 | ||||
Voyage expenses | (9 | ) | — | — | (9 | ) | ||
Vessel operating expenses | (21,563 | ) | (55,223 | ) | — | (76,786 | ) | |
Time-charter hire expense | (2 | ) | (3,744 | ) | — | (3,746 | ) | |
Depreciation and amortization | (1,759 | ) | — | — | (1,759 | ) | ||
General and administrative expenses | (398 | ) | — | (1,623 | ) | (2,021 | ) | |
Write-down of vessels (2) | (12,200 | ) | (9,100 | ) | — | (21,300 | ) | |
Restructuring charges | (900 | ) | 159 | — | (741 | ) | ||
Loss from vessel operations | (20,586 | ) | (6,811 | ) | (1,623 | ) | (29,020 | ) |
Depreciation and amortization | 1,759 | — | — | 1,759 | ||||
Amortization of operating lease liability | — | |||||||
and other | (749 | ) | 602 | — | (147 | ) | ||
Write-down of vessels (2) | 12,200 | 9,100 | — | 21,300 | ||||
Daughter Entities distributions (3) | — | — | 9,379 | 9,379 | ||||
Teekay Parent adjusted EBITDA | (7,376 | ) | 2,891 | 7,756 | 3,271 |
(1) | Includes the results of one chartered-in FSO unit owned by Altera, which is largely on a flow-through basis with Teekay Parent earning a small margin. | |
(2) | Write-down of vessels for the three months ended | |
(3) | In addition to the adjusted EBITDA generated by its directly owned and chartered-in assets, Teekay Parent also receives cash distributions from its consolidated publicly-traded subsidiary, |
Appendix D - Reconciliation of Non-GAAP Financial Measures
Teekay Parent Free Cash Flow
(in thousands of
Three Months Ended | ||||||
2020 | 2020 | 2019 | ||||
(unaudited) | (unaudited) | (unaudited) | ||||
Daughter Entities distributions to Teekay Parent (1) | ||||||
Limited Partner interests (2) | 8,990 | 8,990 | 4,790 | |||
GP interests | 389 | 389 | 300 | |||
Total Daughter Entity Distributions to Teekay Parent | 9,379 | 9,379 | 5,090 | |||
FPSOs | (7,376 | ) | 2,250 | (13,087 | ) | |
Other income and corporate general and administrative expenses | ||||||
Other Income | 2,891 | 3,488 | 649 | |||
Corporate general and administrative expenses (3) | (1,623 | ) | (5,423 | ) | (2,720 | ) |
TEEKAY PARENT ADJUSTED EBITDA (4) | 3,271 | 9,694 | (10,068 | ) | ||
Net interest expense (5) | (8,237 | ) | (8,675 | ) | (8,714 | ) |
Asset retirement costs incurred (6) | (12,169 | ) | (2,927 | ) | — | |
TOTAL TEEKAY PARENT FREE CASH FLOW | (17,135 | ) | (1,908 | ) | (18,782 | ) |
Weighted-average number of common shares - Basic | 101,107,371 | 101,107,362 | 100,784,683 |
(1) | Daughter Entities dividends and distributions for a given quarter consist of the amount of dividends and distributions relating to such quarter but received by Teekay Parent in the following quarter. | |
(2) | Common unit distribution cash flows to Teekay Parent are based on Teekay Parent’s ownership on the ex-dividend date for its publicly-traded subsidiary |
Three Months Ended | ||||||
June, 30 | ||||||
2020 | 2020 | 2019 | ||||
(unaudited) | (unaudited) | (unaudited) | ||||
Distribution per common unit | $ | 0.25 | $ | 0.25 | $ | 0.19 |
Common units owned by | ||||||
Teekay Parent | 35,958,274 | 35,958,274 | 25,208,274 | |||
Total distribution | $ | 8,989,569 | 8,989,569 | $ | 4,789,572 |
(3) | Increase in corporate general and administrative expenses for the three months ended | |
(4) | Please refer to Appendices C and E for additional financial information on Teekay Parent’s adjusted EBITDA. | |
(5) | Please see Appendix E to this release for a description of this measure and a reconciliation of this non-GAAP financial measure as used in this release to interest expense net of interest income, the most directly comparable GAAP financial measure. | |
(6) | Relates to decommissioning activities for the Banff FPSO unit, which have been accrued on the balance sheet as an asset retirement obligation. Please see Appendix C footnote (2) for additional information. |
Non-GAAP Financial Reconciliations
Appendix E - Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA - Consolidated
(in thousands of
Three Months Ended | ||||||
2020 | 2020 | 2019 | ||||
(unaudited) | (unaudited) | (unaudited) | ||||
Net (loss) income | (41,388 | ) | 125,500 | (175,908 | ) | |
Depreciation and amortization | 64,352 | 62,936 | 73,633 | |||
Interest expense, net of interest income | 51,421 | 56,931 | 66,222 | |||
Income tax expense (recovery) | 3,702 | (17,175 | ) | 3,091 | ||
EBITDA | 78,087 | 228,192 | (32,962 | ) | ||
Specific income statement items affecting EBITDA: | ||||||
Write-down and (loss) gain on sale of assets | 66,273 | 10,669 | 175,785 | |||
Adjustments for direct financing and sales-type lease to a cash basis and other | 2,976 | 2,452 | 3,191 | |||
Realized and unrealized losses on derivative instruments | 1,471 | 9,270 | 1,924 | |||
Realized gains (losses) from the settlements of non-designated derivative instruments | 195 | (200 | ) | 435 | ||
Equity income | (24,392 | ) | (35,343 | ) | (21,514 | ) |
Foreign currency exchange loss (gain) | 5,943 | 8,922 | (5,628 | ) | ||
Other loss - net (1) | 14,627 | 399 | 1,424 | |||
Consolidated Adjusted EBITDA | 145,180 | 224,361 | 122,655 | |||
Adjusted EBITDA from equity-accounted vessels (See Appendix E) | 81,818 | 91,508 | 70,225 | |||
Total Adjusted EBITDA | 226,998 | 315,869 | 192,880 |
(1) | Please refer to footnote (8) of the Summary Consolidated Statements of (Loss) Income of this release for further details. |
Appendix E - Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA – Equity-Accounted Vessels
(in thousands of
Three Months Ended | ||||||||||||
(unaudited) | (unaudited) | (unaudited) | ||||||||||
At | Company's | At | Company's | At | Company's | |||||||
100% | Portion(1) | 100% | Portion(1) | 100% | Portion(1) | |||||||
Revenues | 248,474 | 107,619 | 266,539 | 115,422 | 207,749 | 91,490 | ||||||
Vessel and other operating expenses | (77,966 | ) | (34,522 | ) | (74,233 | ) | (32,468 | ) | (60,219 | ) | (26,779 | ) |
Depreciation and amortization | (27,436 | ) | (13,804 | ) | (26,075 | ) | (13,006 | ) | (29,799 | ) | (14,416 | ) |
Income from vessel operations of equity-accounted vessels | 143,072 | 59,293 | 166,231 | 69,948 | 117,731 | 50,295 | ||||||
Net interest expense | (61,774 | ) | (25,228 | ) | (73,310 | ) | (29,465 | ) | (57,031 | ) | (23,423 | ) |
Income tax (expense) recovery | (449 | ) | (235 | ) | 225 | 110 | (32 | ) | (16 | ) | ||
Other items including realized and | ||||||||||||
unrealized loss on derivative | ||||||||||||
instruments (2) | (26,624 | ) | (9,438 | ) | (17,786 | ) | (5,250 | ) | (18,270 | ) | (5,492 | ) |
Gain on sale of equity-accounted | ||||||||||||
investments | — | — | 150 | |||||||||
Net income / equity income of equity-accounted vessels | 54,225 | 24,392 | 75,360 | 35,343 | 42,398 | 21,514 | ||||||
Net income / equity income | ||||||||||||
of equity-accounted vessels | 54,225 | 24,392 | 75,360 | 35,343 | 42,398 | 21,514 | ||||||
Depreciation and amortization | 27,436 | 13,804 | 26,075 | 13,006 | 29,799 | 14,416 | ||||||
Net interest expense | 61,774 | 25,228 | 73,310 | 29,465 | 57,031 | 23,423 | ||||||
Income tax expense (recovery) | 449 | 235 | (225 | ) | (110 | ) | 32 | 16 | ||||
EBITDA | 143,884 | 63,659 | 174,520 | 77,704 | 129,260 | 59,369 | ||||||
Specific income statement items affecting EBITDA: | ||||||||||||
Adjustments for direct financing and sales-type lease to a cash basis | 26,752 | 9,677 | 26,381 | 9,499 | 17,701 | 6,470 | ||||||
Amortization of in-process contracts and other | (1,759 | ) | (956 | ) | (1,738 | ) | (945 | ) | (1,758 | ) | (956 | ) |
Other items including realized and unrealized loss on derivative instruments(2) | 26,624 | 9,438 | 17,786 | 5,250 | 18,270 | 5,492 | ||||||
Loss on sale of equity-accounted investments | — | — | (150 | ) | ||||||||
Adjusted EBITDA from equity-accounted vessels (3) | 195,501 | 81,818 | 216,949 | 91,508 | 163,473 | 70,225 |
(1) | The Company’s proportionate share of its equity-accounted vessels and other investments ranged from 20% to 52%. | |
(2) | Includes credit loss provision adjustments recorded upon the adoption of ASU 2016-13 for the three months ended | |
(3) | Adjusted EBITDA from equity-accounted vessels represents the Company’s proportionate share of adjusted EBITDA from its equity-accounted vessels and other investments. |
Appendix E - Reconciliation of Non-GAAP Financial Measures
Total Adjusted Revenues
(in thousands of
Three Months Ended | |||||||
2020 | 2020 | 2019 (1) | |||||
(unaudited) | (unaudited) | (unaudited) | |||||
Revenues | 396,517 | 482,805 | 425,836 | ||||
Proportionate share of revenues | |||||||
from equity-accounted joint ventures | 107,619 | 115,422 | 91,490 | ||||
Less proportionate share of voyage revenues | |||||||
earned directly from equity-accounted joint ventures | (6,021 | ) | (5,569 | ) | (5,501 | ) | |
Total adjusted revenues | 498,115 | 592,658 | 511,825 |
(1) | Comparative balances relating to the three months ended |
Appendix E - Reconciliation of Non-GAAP Financial Measures
Adjusted EBITDA - Teekay Parent
(in thousands of
Three Months Ended | |||||||||||
(unaudited) | |||||||||||
Teekay | |||||||||||
Corporate | Parent | ||||||||||
FPSOs | Other | G&A | Total | ||||||||
Teekay Parent (loss) income from vessel operations | (11,540 | ) | 2,892 | (5,423 | ) | (14,071 | ) | ||||
Write-down of vessels | 13,565 | — | — | 13,565 | |||||||
Depreciation and amortization | 1,761 | — | — | 1,761 | |||||||
Amortization of operating lease liability and other | (1,536 | ) | 596 | — | (940 | ) | |||||
Daughter Entities distributions | — | — | 9,401 | 9,401 | |||||||
Adjusted EBITDA – Teekay Parent | 2,250 | 3,488 | 3,978 | 9,716 |
Three Months Ended | |||||||||||
(unaudited) | |||||||||||
Teekay | |||||||||||
Corporate | Parent | ||||||||||
FPSOs | Other | G&A | Total | ||||||||
Teekay Parent (loss) income from vessel operations | (194,415 | ) | 8 | (2,720 | ) | (197,127 | ) | ||||
Write-down of vessels | 175,000 | — | — | 175,000 | |||||||
Depreciation and amortization | 7,811 | 38 | — | 7,849 | |||||||
Amortization of in-process revenue contracts and other | (1,483 | ) | 603 | — | (880 | ) | |||||
Daughter Entities distributions | — | — | 5,090 | 5,090 | |||||||
Adjusted EBITDA – Teekay Parent | (13,087 | ) | 649 | 2,370 | (10,068 | ) |
Appendix E - Reconciliation of Non-GAAP Financial Measures
Net Interest Expense - Teekay Parent
(in thousands of
Three Months Ended | ||||||||
2020 | 2020 | 2019 | ||||||
(unaudited) | (unaudited) | (unaudited) | ||||||
Interest expense | (53,175 | ) | (59,245 | ) | (67,707 | ) | ||
Interest income | 1,754 | 2,314 | 1,485 | |||||
Interest expense net of interest income consolidated | (51,421 | ) | (56,931 | ) | (66,222 | ) | ||
Less: Non-Teekay Parent interest expense net of interest income | (41,338 | ) | (46,371 | ) | (55,545 | ) | ||
Interest expense net of interest income - Teekay Parent | (10,083 | ) | (10,560 | ) | (10,677 | ) | ||
Teekay Parent non-cash accretion and loan cost amortization | 2,188 | 2,191 | 2,204 | |||||
Teekay Parent realized losses on interest rate swaps | (342 | ) | (306 | ) | (241 | ) | ||
Net interest expense - Teekay Parent | (8,237 | ) | (8,675 | ) | (8,714 | ) |
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, among other things, regarding: the impact of COVID-19 and related global events on the Company’s business and financial results; fixed charter coverage for Teekay LNG’s and Teekay Tankers’ fleets for the remainder of 2020 and 2021; the timing and cost of the remediation of the Banff field’s subsea infrastructure and the Banff FPSO unit's decommissioning and recycling; and the Company's liquidity and the Teekay Group’s positioning for both near-term market volatility and to create long-term shareholder value. 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: market or counterparty reaction to changes in exploration, production and storage of offshore oil and gas, either generally or in particular regions that would impact expected future growth; changes in the demand for oil, refined products, LNG or LPG; changes in trading patterns significantly affecting overall vessel tonnage requirements; greater or less than anticipated levels of vessel newbuilding orders and deliveries and greater or less than anticipated rates of vessel scrapping; changes in global oil prices or tanker rates; OPEC+ and non-
Reflects unrealized gains (losses) relating to the change in the mark-to-market value of derivative instruments that are not designated in qualifying hedging relationships for accounting purposes, including those gains (losses) included in the Company's proportionate share of equity income (loss) from joint ventures.
Source:
2020 GlobeNewswire, Inc., source