HAMILTON, BERMUDA -- (Marketwired) -- 08/07/14 -- Teekay Corporation (NYSE: TK) -
-- Second quarter 2014 total cash flow from vessel operations of $224.4
million, an increase of 22 percent from the same period of the prior
year.
-- Second quarter 2014 adjusted net loss attributable to stockholders of
Teekay of $20.1 million, or $0.28 per share (excluding specific items
which increased GAAP net loss by $22.9 million, or $0.32 per share).
-- In July 2014, the Petrojarl Knarr FPSO sailed away from the shipyard and
is on track to commence its charter contract in the fourth quarter of
2014.
-- In July 2014, the Banff FPSO recommenced operations under its charter
contract; repairs to the Foinaven FPSO were completed and is gradually
increasing its production throughput.
-- Total consolidated liquidity of approximately $1.8 billion as at June
30, 2014, giving pro forma effect to Teekay LNG's $141 million equity
issuance completed in mid-July 2014.
Teekay Corporation (Teekay or the Company) today reported adjusted net loss attributable to stockholders of Teekay(1) of $20.1 million, or $0.28 per share, for the quarter ended June 30, 2014, compared to adjusted net loss attributable to stockholders of Teekay of $33.3 million, or $0.47 per share, for the same period of the prior year. Adjusted net loss attributable to stockholders of Teekay excludes a number of specific items that had the net effect of increasing GAAP net loss by $22.9 million, or $0.32 per share, for the three months ended June 30, 2014 and increasing GAAP net income by $44.7 million, or $0.63 per share, for the same period of the prior year, as detailed in Appendix A to this release. Including these items, the Company reported on a GAAP basis, net loss attributable to stockholders of Teekay of $43.0 million, or $0.60 per share, for the quarter ended June 30, 2014, compared to net income attributable to stockholders of Teekay of $11.4 million, or $0.16 per share, for the same period of the prior year. Net revenues(2) for the second quarter of 2014 increased to $418.8 million, compared to $404.6 million for the same period of the prior year.
For the six months ended June 30, 2014, the Company reported adjusted net loss attributable to stockholders of Teekay(1) of $16.6 million, or $0.23 per share, compared to adjusted net loss attributable to stockholders of Teekay of $45.0 million, or $0.63 per share, for the same period of the prior year. Adjusted net loss attributable to stockholders of Teekay excludes a number of specific items that had the net effect of increasing GAAP net loss by $26.9 million, or $0.38 per share, for the six months ended June 30, 2014 and increasing GAAP net income by $50.2 million, or $0.71 per share, for the same period of the prior year, as detailed in Appendix A to this release. Including these items, the Company reported on a GAAP basis, net loss attributable to stockholders of Teekay of $43.5 million, or $0.61 per share, for the six months ended June 30, 2014, compared to net income attributable to stockholders of Teekay of $5.2 million, or $0.07 per share, for the same period of the prior year. Net revenues(2) for the six months ended June 30, 2014 increased to $890.3 million, compared to $829.3 million for the same period of the prior year.
On July 3, 2014, the Company declared a cash dividend on its common stock of $0.31625 per share for the quarter ended June 30, 2014. The cash dividend was paid on July 31, 2014 to all shareholders of record on July 18, 2014.
(1) Adjusted net loss attributable to stockholders 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 United States generally accepted accounting principles (GAAP) and for information about specific items affecting net (loss) income that are typically excluded by securities analysts in their published estimates of the Company's financial results.
(2) 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.
"We have continued to make steady progress on the execution of our existing business development projects and added new important projects which, when completed, we expect will create future value for Teekay Parent and its daughter companies," commented Peter Evensen, Teekay Corporation's President and Chief Executive Officer. "In late-June, we took delivery of the Petrojarl Knarr FPSO from the shipyard in South Korea and the unit is currently in transit to the North Sea for field installation and offshore testing. Following the expected commencement of its charter contract in the fourth quarter of 2014, the Petrojarl Knarr FPSO, our largest FPSO project to-date, will be eligible for dropdown to Teekay Offshore. We are also pleased to report that in July, the Petrojarl Banff FPSO recommenced operations under its charter contract and the unit is generating cash flow after approximately 30 months of off-hire for storm-related repairs and upgrades. Finally, repairs to the gas compressors onboard the Petrojarl Foinaven FPSO were completed in July and the unit is now gradually increasing its oil production throughput."
Mr. Evensen continued, "Teekay LNG was active during the second quarter of 2014 securing new, long-term accretive contracts to construct and operate ten new LNG carriers of which Teekay LNG's share of the capital investment will be approximately $1.3 billion, bringing Teekay LNG's committed growth pipeline to over $2.5 billion over the next several years," continued Mr. Evensen. "Teekay Offshore was also active, finalizing contracts to enter into new adjacencies in the long-haul towage and floating accommodation businesses, which will provide Teekay Offshore with additional growth channels to complement its existing offshore segments. We anticipate that expected continued growth of our two MLP daughter entities will benefit Teekay Parent in the form of increased general and limited partner cash flows in the coming years and, in addition, the dropdown sale of the remaining FPSOs owned by Teekay Parent will significantly delever Teekay Parent's balance sheet."
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 June 30, 2014
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(unaudited)
Teekay
(in thousands of Offshore Teekay LNG Teekay Teekay
U.S. dollars) Partners LP Partners LP Tankers Ltd. Parent
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Net revenues(1) 215,146 100,156 40,821 90,797
Vessel operating
expense 88,184 24,320 23,585 65,625
Time-charter
hire expense 4,975 - 1,112 32,654
Depreciation and
amortization 48,474 23,530 12,425 18,944
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CFVO -
Consolidated(2)
(3)(4) 102,774 71,650 12,961 (23,277)
CFVO - Equity
Investments(5) 7,135 50,894 1,278 1,011
CFVO - Total 109,909 122,544 14,239 (22,266)
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Three Months Ended June 30,
2014
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(unaudited)
Teekay
(in thousands of Consolidation Corporation
U.S. dollars) Adjustments Consolidated
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Net revenues(1) (28,105) 418,815
Vessel operating
expense - 201,714
Time-charter
hire expense (29,027) 9,714
Depreciation and
amortization - 103,373
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CFVO -
Consolidated(2)
(3)(4) - 164,108
CFVO - Equity
Investments(5) - 60,318
CFVO - Total - 224,426
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Three Months Ended June 30, 2013
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(unaudited)
Teekay
(in thousands of Offshore Teekay LNG Teekay Teekay
U.S. dollars) Partners LP Partners LP Tankers Ltd. Parent
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Net revenues(1) 206,629 95,395 41,043 97,094
Vessel operating
expense 87,825 24,814 24,832 58,507
Time-charter
hire expense 14,093 - 1,951 46,447
Depreciation and
amortization 50,662 25,156 11,921 22,030
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CFVO -
Consolidated(2)
(3)(4) 90,215 65,473 10,658 (35,560)
CFVO - Equity
Investments(5) 1,311 47,162 23 4,347
CFVO - Total 91,526 112,635 10,681 (31,213)
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Three Months Ended June 30,
2013
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(unaudited)
Teekay
(in thousands of Consolidation Corporation
U.S. dollars) Adjustments Consolidated
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Net revenues(1) (35,608) 404,553
Vessel operating
expense - 195,978
Time-charter
hire expense (35,947) 26,544
Depreciation and
amortization - 109,769
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CFVO -
Consolidated(2)
(3)(4) - 130,786
CFVO - Equity
Investments(5) - 52,843
CFVO - Total - 183,629
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(1) Net voyage revenues represents voyage 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 voyage 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 and losses on the sale
of vessels, adjustments for direct financing leases to a cash basis, and
unrealized gains and losses relating to derivatives, but includes realized
gains and losses on the settlement of foreign currency forward contracts.
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 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 June 30, 2014 and 2013, Teekay Parent
received dividends and distributions from Teekay LNG, Teekay Offshore and
Teekay Tankers totaling $43.7 million and $39.8 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 and storage services to the offshore oil industry through its fleet of 34 shuttle tankers (including two charter-in vessels), five floating production, storage and offloading (FPSO) units, six floating storage and offtake (FSO) units (excluding one FSO unit under conversion), four long-haul towing and anchor handling vessel newbuildings, three floating accommodation unit newbuildings, one HiLoad Dynamic Positioning (DP) unit and four conventional oil 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 29.2 percent interest in Teekay Offshore (including the 2 percent sole general partner interest).
For the second quarter of 2014, 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 $17.7 million for the second quarter of 2014, as detailed in Appendix D to this release.
Cash flow from vessel operations from Teekay Offshore increased to $109.9 million in the second quarter of 2014, from $91.5 million in the same period of the prior year. The increase was primarily due to the acquisition of the Voyageur Spirit FPSO and a 50 percent interest in the Cidade de Itajai FPSO in the second quarter of 2013 and the commencement of the time-charters with BG Group for four newbuilding shuttle tankers in June, August, November 2013 and January 2014. These increases were partially offset by the lay-up and sale of older shuttle and conventional tankers during 2013 and 2014 as their related charter contracts expired or terminated.
In August 2014, Teekay Offshore acquired Logitel Offshore Holdings Ltd. (Logitel), a Norway-based company focused on the high-end floating accommodation market. Logitel is currently constructing two newbuilding floating accommodation units (FAUs), based on the Sevan Marine ASA cylindrical hull design, at the COSCO (Nantong) Shipyard (COSCO) in China. Teekay Offshore intends to immediately exercise one of its existing six options with COSCO to construct a third FAU, subject to final documentation. Prior to the acquisition, Logitel secured a three-year fixed-rate charter contract, plus extension options, with Petroleo Brasileiro SA (Petrobras) in Brazil for the first FAU, which is scheduled to deliver in the first quarter of 2015. Teekay Offshore expects to secure charter contracts for the remaining two newbuilding FAUs prior to their respective scheduled deliveries in the fourth quarter of 2015 and the third quarter of 2016. The construction agreements with COSCO for the newbuilding FAUs have a favorable payment schedule, with the majority of the purchase price due upon delivery.
Odebrecht Oil & Gas S.A (Odebrecht), on behalf of Teekay Offshore's 50/50 joint venture with Odebrecht, was recently nominated by Petrobras as the lead commercial bidder on the Libra FPSO project in Brazil, and has been invited by Petrobras to conclude contract negotiations. The FPSO unit is expected to be owned and operated by Teekay Offshore's 50/50 joint venture with Odebrecht and will service the Libra pre-salt field in the Santos Basin offshore Brazil, which is expected to commence operations in early-2017. The final contract negotiations are expected to be completed during the third quarter of 2014.
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 current fleet of 44 LNG carriers (including one LNG regasification unit and 15 newbuildings under construction), 26 LPG/Multigas carriers (including 10 newbuildings under construction) and nine conventional tankers. Teekay LNG's interests in these vessels range from 20 to 100 percent. In addition, Teekay LNG, through its 50/50 LPG joint venture with Exmar NV (Exmar LPG BVBA), charters-in four LPG carriers. Teekay Parent currently owns a 34.0 percent interest in Teekay LNG (including the 2 percent sole general partner interest).
For the second quarter of 2014, Teekay LNG's quarterly distribution was $0.6918 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 $25.3 million for the second quarter of 2014, as detailed in Appendix D to this release.
Teekay LNG's total cash flow from vessel operations, including cash flows from equity-accounted vessels, increased to $122.5 million in the second quarter of 2014, from $112.6 million in the same period of the prior year. The increase was primarily due to the acquisitions of, and contributions by, the two Awilco LNG carriers in late-2013 and higher revenues from Exmar LPG BVBA as a result of newbuilding deliveries and higher spot rates, which was partially offset by the sale of two conventional tankers in December 2013 and February 2014 and two older LPG carriers in Exmar LPG BVBA during the first half of 2014.
In early-July 2014, Teekay LNG, through a new 50/50 joint venture with China LNG Shipping (Holdings) Limited (China LNG), finalized agreements to provide six internationally-flagged icebreaker LNG carriers for the Yamal LNG project located on the Yamal Peninsula in Northern Russia. The Yamal LNG project is a joint venture between Novatek, Total and China National Petroleum Corporation and will consist of three LNG trains with a total capacity of 16.5 million metric tonnes per annum. Following the scheduled start-up in early 2018, LNG from the Yamal project is expected to be transported from Northern Russia to Europe and Asia. The Yamal LNG joint venture has announced that nearly all of the expected LNG production output of the project has already been agreed to be purchased by affiliates of the Yamal LNG project sponsors and other third parties. Under the agreements, the joint venture will provide six 172,000 cubic meter (cbm) ARC7 LNG carrier newbuildings which will be constructed by Daewoo Shipbuilding & Marine Engineering Co., Ltd. of South Korea for a total fully built-up cost of approximately $2.1 billion. The vessels, which will be constructed with maximum 2.1 meter icebreaking capabilities in both the forward and reverse direction, are scheduled to deliver between the first quarter of 2018 and the first quarter of 2020 and will each operate under time-charter contracts until December 31, 2045, plus extension options, following their respective deliveries.
In late-June 2014, Teekay LNG acquired from BG Group (BG) ownership interests in four 174,000 cbm Tri-Fuel Diesel Electric LNG carrier newbuildings, which will be constructed by Hudong-Zhonghua Shipbuilding (Group) Co., Ltd. in China for a total fully built-up cost of approximately $1.0 billion. The vessels, which are scheduled to deliver between September 2017 and January 2019, will each operate under 20-year time-charter contracts, plus extension options, with BG. Teekay LNG is responsible for the construction supervision services for the newbuildings and Teekay will provide the technical management of the vessels upon their respective deliveries. Through this transaction, Teekay LNG acquired a 30 percent ownership in the first two LNG carrier newbuildings with the balance of ownership by CETS (an affiliate of China National Offshore Oil Corporation (CNOOC)) and China LNG, and a 20 percent ownership interest in the second two LNG carrier newbuildings with the balance of ownership held by CETS, China LNG and BW Group.
Teekay Tankers Ltd.
Teekay Tankers currently owns a fleet of 28 vessels, including 11 Aframax tankers, 10 Suezmax tankers, three Long Range 2 (LR2) product tankers, three Medium-Range (MR) product tankers and a 50 percent interest in a Very Large Crude Carrier (VLCC). In addition, Teekay Tankers has contracted to charter-in four Aframax and four LR2 product tankers. Of the 36 vessels, 12 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 January 2014, Teekay Tankers and Teekay formed and each invested $25 million in Tanker Investments Ltd. (TIL), a new company established to acquire conventional tanker assets at current cyclical-low prices. 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 28.7 percent economic interest in and has voting control of Teekay Tankers.
For the second quarter of 2014, Teekay Tankers declared a second quarter 2014 dividend of $0.03 per share. Based on its ownership of Teekay Tankers Class A and Class B shares, the dividend paid to Teekay Parent totaled $0.6 million for the second quarter of 2014.
Cash flow from vessel operations from Teekay Tankers increased to $14.2 million in the second quarter of 2014, from $10.7 million in the same period of the prior year. The increase is primarily due to the stronger average spot tanker rates in the second quarter of 2014 compared to the same period in the prior year, partially offset by a decrease in recognized interest income as a result of the monetization of Teekay Tankers' investment in term loans in late-March 2014.
On August 1, 2014, Teekay Tankers' completed the acquisition of a 50 percent ownership interest in Teekay's commercial and technical management operations (Teekay Operations) for approximately $15 million, paid in shares of Teekay Tankers. Teekay Operations includes direct ownership in three commercially managed tanker pools, which currently generate income from commercially managing a fleet of 89 vessels, and direct ownership in Teekay Marine Limited, which currently generates income from technically managing a fleet of 53 vessels, including vessels owned by Teekay Tankers.
During the second quarter of 2014, Teekay Tankers secured time charter-in contracts for two Aframax vessels and four LR2 product tanker vessels, which increased Teekay Tankers' total time charter-in fleet to eight vessels. The new time charter-in contracts have an average daily rate of $15,600 for the Aframax vessels and $15,975 for the LR2 product tanker vessels.
In early-May 2014, Teekay Tankers sold two VLCC vessels to TIL for an aggregate purchase price of approximately $154.0 million. As a result, Teekay Tankers recognized a $10.0 million gain on the sale during the second quarter of 2014.
Teekay Parent
In addition to its equity ownership interests in Teekay Offshore, Teekay LNG and Teekay Tankers, Teekay Parent directly owns five FPSO units and one VLCC vessel. As at August 1, 2014, Teekay Parent also had six charter-in conventional tankers (including four Aframax tankers owned by Teekay Offshore), two charter-in LNG carriers owned by Teekay LNG, and two charter-in FSOs and two shuttle tankers owned by Teekay Offshore.
For the second quarter of 2014, Teekay Parent generated negative cash flow from vessel operations of $22.3 million, compared to negative cash flow from vessel operations of $31.2 million in the same period of the prior year. The reduction in negative cash flow is primarily due to the re-delivery of several in-chartered tankers over the past year, higher spot tanker rates and fees earned from managing TIL vessel transactions in the second quarter of 2014, partially offset by the completion of the Petrojarl I FPSO time-charter in April 2013 and the sale of four conventional tankers to TIL in the first quarter of 2014.
In late-June 2014, Teekay Parent took delivery of the Petrojarl Knarr FPSO newbuilding in South Korea and the unit is currently in transit to the North Sea. Following installation and offshore testing on the Knarr field, the unit is expected to commence its ten-year charter contract with BG late in the fourth quarter of 2014.
Teekay Parent has recently signed a letter of intent with CarVal Investors (CarVal), a leading global alternative investment manager, to participate in the development of a dry bulk shipping company. The new company currently owns a fleet of 16 modern dry bulk vessels (including six newbuildings on order) and plans to opportunistically acquire additional modern dry bulk vessels. As part of the proposed transaction, Teekay Parent will provide operational and corporate services to the new company and plans to invest up to $25 million in the entity. Each of the vessels is, or is expected to be upon delivery, chartered to Cargill Ocean Transportation, one of the world's largest charterers of dry bulk vessels, and will receive a guaranteed minimum floor rate for a period of two years from delivery. Teekay Parent expects the proposed transaction to be finalized by the end of 2014. CarVal Investors is an independent subsidiary of Cargill, a global leader in providing food, agricultural, risk management, financial, and industrial products and services.
Fleet List
The following table summarizes Teekay's consolidated fleet of 185 vessels as at August 1, 2014, including chartered-in vessels and vessels under construction but excluding vessels managed for third parties:
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Number of Vessels(1)
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Owned Chartered-in Newbuildings /
Vessels Vessels Conversions Total
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Teekay Parent Fleet(2)(3)
Aframax Tankers (4) - 2 - 2
VLCC Tanker (5) 1 - - 1
MR Product Tanker - 1 - 1
FPSO Units 4 - 1 5
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Total Teekay Parent Fleet 5 3 1 9
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Teekay Offshore Fleet 48 2 7 57
Teekay LNG Fleet 54 4 25 83
Teekay Tankers Fleet 28 8 - 36
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Total Teekay Consolidated
Fleet 135 17 33 185
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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 two FSO units chartered-in from Teekay
Offshore.
(4) Excludes four Aframax tankers chartered-in from Teekay Offshore.
(5) In late-March 2014, Teekay Parent exercised its rights under the
security documents to realize amounts it was owed under its investment in a
term loan and assumed full ownership of the 2011-built VLCC vessel, which
previously secured the investment in the term loan. The vessel is a
potential FPSO conversion candidate.
Liquidity
As at June 30, 2014, the Company had consolidated liquidity of $1.6 billion (consisting of $748.9 million of cash and cash equivalents and $877.9 million of undrawn revolving credit facilities), of which $488.9 million of liquidity (consisting of $353.9 million cash and cash equivalents and $135.0 million of undrawn revolving credit facilities) is attributable to Teekay Parent. Giving pro forma effect to the approximately $141 million of net proceeds from Teekay LNG's equity issuance completed in mid-July 2014, Teekay had total consolidated liquidity of approximately $1.8 billion as at June 30, 2014.
Conference Call
The Company plans to host a conference call on Thursday, August 7, 2014 at 11:00 a.m. (ET) to discuss its results for the second quarter of 2014. 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) 524-8860 or (416) 204-9702, if outside North America,
and quoting conference ID code 7733617.
-- 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, August 14, 2014. 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 7733617.
About Teekay
Teekay Corporation is an operational leader and project developer in the marine midstream space. Through its general partnership interests in two master limited partnerships, Teekay LNG Partners L.P. (NYSE: TGP) and Teekay Offshore Partners L.P. (NYSE: TOO), its controlling ownership of Teekay Tankers Ltd. (NYSE: TNK), and its fleet of directly-owned vessels, Teekay is responsible for managing and operating consolidated assets of over $12 billion, comprised of approximately 185 liquefied gas, offshore, and conventional tanker assets. 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 (LOSS) INCOME
(in thousands of U.S. dollars, except share and per share data)
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Three Months Ended Six Months Ended
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June 30, March 31, June 30, June 30, June 30,
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2014 2014 2013 2014 2013
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(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
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REVENUES(1)(2) 452,254 506,494 430,707 958,748 881,744
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OPERATING
EXPENSES
Voyage expenses
(2) 33,439 35,012 26,154 68,451 52,469
Vessel operating
expenses (1)(2) 201,714 201,186 195,978 402,900 383,442
Time-charter
hire expense 9,714 16,292 26,544 26,006 53,996
Depreciation and
amortization 103,373 103,458 109,769 206,831 212,263
General and
administrative
(2) 36,945 37,878 35,395 74,823 74,666
Loan loss
(recoveries)
provisions (3) (2,521) - 7,042 (2,521) 10,207
(Gain) loss on
sale of vessels
and equipment (9,615) 162 (1,341) (9,453) (1,309)
Restructuring
charges (244) 639 1,789 395 3,843
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372,805 394,627 401,330 767,432 789,577
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Income from
vessel
operations 79,449 111,867 29,377 191,316 92,167
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OTHER ITEMS
Interest expense
(2) (49,656) (49,333) (44,687) (98,989) (87,197)
Interest income
(2) 793 1,783 2,018 2,576 3,036
Realized and
unrealized
(loss) gain on
derivative
instruments (2) (75,331) (47,248) 56,035 (122,579) 42,246
Equity income
(4) 35,271 27,494 47,372 62,765 74,687
Income tax
expense (3,193) (2,798) (1,873) (5,991) (4,373)
Foreign exchange
(loss) gain (2,046) (894) 678 (2,940) 2,867
Other (loss)
income - net (734) 8,251 (1,386) 7,517 3,856
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Net (loss)
income (15,447) 49,122 87,534 33,675 127,289
Less: Net income
attributable to
non-controlling
interests (27,540) (49,610) (76,167) (77,150) (122,058)
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Net (loss)
income
attributable to
stockholders of
Teekay
Corporation (42,987) (488) 11,367 (43,475) 5,231
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(Loss) earnings
per common
share of Teekay
- Basic ($0.60) ($0.01) $0.16 ($0.61) $0.07
- Diluted ($0.60) ($0.01) $0.16 ($0.61) $0.07
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Weighted-average
number of
common shares
outstanding
- Basic 72,036,526 71,328,577 70,393,531 71,687,549 70,142,301
- Diluted 72,036,526 71,328,577 71,314,629 71,687,549 71,142,363
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) The costs of business development and engineering studies relating to
North Sea FPSO and FSO projects that the Company is pursuing are
substantially reimbursable from customers upon completion. As a result, $2.8
million of revenues and $2.6 million of costs were recognized in the six
months ended June 30, 2014 upon completion of one FPSO study.
(2) Realized and unrealized (losses) gains related to derivative instruments
that are not designated as hedges for accounting purposes are included as a
separate line item in the statements of (loss) income. The realized (losses)
gains relate to the amounts the Company actually received or paid to settle
such derivative instruments and the unrealized (losses) gains relate to the
change in fair value of such derivative instruments, as detailed in the
table below:
Three Months Ended Six Months Ended
--------------------------------------------------
June 30, March 31, June 30, June 30, June 30,
--------------------------------------------------
2014 2014 2013 2014 2013
--------------------------------------------------
Realized (losses) gains
relating to:
Interest rate swaps (30,755) (29,490) (30,899) (60,245) (61,251)
Termination of interest
rate swap agreements - 1,000 (4,187) 1,000 (4,187)
Foreign currency forward
contracts 110 (1,285) (1,873) (1,175) (1,452)
--------------------------------------------------
(30,645) (29,775) (36,959) (60,420) (66,890)
--------------------------------------------------
Unrealized (losses) gains
relating to:
Interest rate swaps (39,096) (25,398) 96,911 (64,494) 116,115
Foreign currency forward
contracts (1,926) 3,051 (3,917) 1,125 (6,979)
Stock purchase warrants (3,664) 4,874 - 1,210 -
--------------------------------------------------
(44,686) (17,473) 92,994 (62,159) 109,136
--------------------------------------------------
Total realized and
unrealized (losses) gains
on non-designated
derivative instruments (75,331) (47,248) 56,035 (122,579) 42,246
--------------------------------------------------
(3) The Company recovered $2.5 million during the three and six months ended
June 30, 2014, related to a receivable for an FPSO front-end engineering and
design study (FEED) completed in 2013, which was previously provided for.
The Company also recognized $7.0 million and $10.2 million of allowances,
respectively, for the three and six months ended June 30, 2013, in relation
to its investments in three term loans.
(4) The Company's proportionate share of items within equity income as
identified in Appendix A of this release, is as detailed in the table below.
By excluding these items from equity income, 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.
Three Months Ended Six Months Ended
--------------------------------------------------
June 30, March 31, June 30, June 30, June 30,
--------------------------------------------------
2014 2014 2013 2014 2013
--------------------------------------------------
Equity income 35,271 27,494 47,372 62,765 74,687
Proportionate share of
unrealized losses (gains)
on derivative instruments 1,990 909 (17,176) 2,899 (22,549)
Dilution gain on share
issuance by TIL - (4,108) - (4,108) -
Other(i) (9,772) 966 - (8,806) -
--------------------------------------------------
Equity income adjusted for
items in Appendix A 27,489 25,261 30,196 52,750 52,138
--------------------------------------------------
--------------------------------------------------
(i) Includes (gain) loss on sale of vessels in Exmar LPG BVBA joint venture.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
SUMMARY CONSOLIDATED BALANCE SHEETS
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
As at As at As at
June 30, March 31, December 31
---------------------------------------------
2014 2014 2013
---------------------------------------------
(unaudited) (unaudited) (unaudited)
---------------------------------------------
ASSETS
Cash and cash equivalents 748,900 583,992 614,660
Other current assets 643,471 605,414 622,771
Restricted cash - current 3,935 4,236 4,748
Restricted cash - long-term 499,108 498,898 497,984
Assets held for sale(1) - 144,000 176,247
Vessels and equipment 6,424,695 6,537,789 6,554,820
Advances on newbuilding
contracts and conversion costs 1,403,850 1,060,919 796,324
Derivative assets 131,983 128,692 92,837
Investment in equity accounted
investees 807,700 767,377 690,309
Investment in term loans - - 211,579
Investment in direct financing
leases 774,026 722,034 727,262
Other assets 348,314 310,011 291,723
Intangible assets 101,157 104,453 107,898
Goodwill 168,572 168,572 166,539
----------------------------------------------------------------------------
Total Assets 12,055,711 11,636,387 11,555,701
----------------------------------------------------------------------------
----------------------------------------------------------------------------
LIABILITIES AND EQUITY
Accounts payable and accrued
liabilities 571,979 698,308 565,239
Liabilities associated with
assets held for sale(1) - - 168,007
Current portion of long-term
debt 721,317 1,027,626 1,028,093
Long-term debt 6,576,224 5,775,799 5,679,706
Derivative liabilities 549,515 476,735 443,569
In-process revenue contracts 159,816 169,852 179,852
Other long-term liabilities 367,698 292,273 271,621
Redeemable non-controlling
interest 15,149 15,911 16,564
Equity:
Non-controlling interests 2,009,585 2,034,379 2,071,262
Stockholders of Teekay 1,084,428 1,145,504 1,131,788
----------------------------------------------------------------------------
Total Liabilities and Equity 12,055,711 11,636,387 11,555,701
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) In connection with the 2014 sale of four conventional tanker owning
companies to TIL, the vessels and equipment, long-term debt and working
capital related to the four vessel-owning companies were classified as
"Assets held for sale" and "Liabilities associated with assets held for
sale" as at December 31, 2013.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Six Months Ended
------------------------------
June 30
------------------------------
2014 2013
------------------------------
(unaudited) (unaudited)
------------------------------
Cash and cash equivalents provided by (used
for)
OPERATING ACTIVITIES
----------------------------------------------------------------------------
Net operating cash flow 201,529 66,824
----------------------------------------------------------------------------
FINANCING ACTIVITIES
Net proceeds from long-term debt 1,872,259 1,163,917
Scheduled repayments of long-term debt (616,912) (234,187)
Prepayments of long-term debt (669,413) (703,816)
(Increase) decrease in restricted cash (385) 465
Net proceeds from public offerings of Teekay
LNG - 4,819
Net proceeds from public offerings of Teekay
Offshore 7,475 207,582
Equity contribution by joint venture partner 22,017 1,684
Issuance of common stock upon exercise of
stock options 44,372 16,582
Distribution from subsidiaries to non-
controlling interests (155,567) (125,728)
Cash dividends paid (45,188) (45,282)
----------------------------------------------------------------------------
Net financing cash flow 458,658 286,036
----------------------------------------------------------------------------
INVESTING ACTIVITIES
Expenditures for vessels and equipment (602,257) (320,018)
Proceeds from sale of vessels and equipment 165,055 39,551
Investment in term loans 4,814 -
Repayments by (advances to) joint ventures and
joint venture partners 6,175 (41,452)
Investment in equity accounted investments (50,648) (136,413)
Investment in direct financing lease assets (54,800) -
Direct financing lease payments received and
other 5,714 6,187
----------------------------------------------------------------------------
Net investing cash flow (525,947) (452,145)
----------------------------------------------------------------------------
Increase (decrease) in cash and cash
equivalents 134,240 (99,285)
Cash and cash equivalents, beginning of the
period 614,660 639,491
----------------------------------------------------------------------------
Cash and cash equivalents, end of the period 748,900 540,206
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX A - SPECIFIC ITEMS AFFECTING NET (LOSS) INCOME
(in thousands of U.S. dollars, except per share data)
Set forth below is a reconciliation of the Company's unaudited adjusted net loss attributable to stockholders of Teekay, a non-GAAP financial measure, to net (loss) income attributable to stockholders 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 loss attributable to the stockholders 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 Six Months Ended
----------------------------------------
June 30, 2014 June 30, 2014
----------------------------------------
(unaudited) (unaudited)
$ Per $ Per
$ Share(1) $ Share(1)
----------------------------------------------------------------------------
Net (loss) income - GAAP basis (15,447) 33,675
Adjust for: Net income attributable
to non-controlling interests (27,540) (77,150)
----------------------------------------------------------------------------
Net loss attributable to
stockholders of Teekay (42,987) (0.60) (43,475) (0.61)
Add (subtract) specific items
affecting net income:
Unrealized losses from derivative
instruments (2) 46,676 0.65 65,058 0.91
Foreign exchange loss (3) 1,903 0.03 2,652 0.04
Restructuring charges (4) (244) - 395 0.01
Net gain on sale of vessels and
loan loss recoveries (5) (12,136) (0.17) (11,974) (0.17)
Realized gain on termination of
interest rate swap - - (1,000) (0.01)
Dilution gain on share issuance by
TIL (6) - - (4,108) (0.06)
Other (7) (2,116) (0.03) (3,703) (0.05)
Non-controlling interests' share
of items above (8) (11,190) (0.16) (20,463) (0.29)
----------------------------------------------------------------------------
Total adjustments 22,893 0.32 26,857 0.38
----------------------------------------------------------------------------
Adjusted net loss attributable to
stockholders of Teekay (20,094) (0.28) (16,618) (0.23)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Fully diluted per share amounts.
(2) Reflects the unrealized gains or 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 Norwegian Kroner bonds. Nearly all of the
Company's foreign currency exchange gains and losses are unrealized.
(4) Restructuring charges primarily relate to the reorganization of the
Company's marine operations.
(5) Relates to the net gain on sale of six vessels to TIL and the recovery
of FPSO FEED study costs previously provided for.
(6) Relates to the unrealized gain on the TIL stock purchase warrants issued
to the Company and Teekay Tankers in connection with TIL's formation and
initial funding.
(7) Other primarily relates to pre-operational costs and realized losses on
interest rate swaps for the Petrojarl Knarr FPSO and the Company's share of
the (gain) loss on sale of vessels in Exmar LPG BVBA joint venture.
(8) Items affecting net (loss) income include items from the Company's
wholly-owned subsidiaries, its consolidated non-wholly-owned subsidiaries
and its proportionate share of items from equity accounted for investments.
The specific items affecting net (loss) income are analyzed to determine
whether any of the amounts originated from a consolidated non-wholly-owned
subsidiary. Each amount that originates from a consolidated non-wholly-owned
subsidiary is multiplied by the non-controlling interests' percentage share
in this subsidiary to arrive at the non-controlling interests' share of the
amount. The amount identified as "Non-controlling interests' share of items
above" in the table above is the cumulative amount of the non-controlling
interests' proportionate share of items listed in the table.
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 loss attributable to stockholders of Teekay, a non-GAAP financial measure, to net income attributable to stockholders 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 loss attributable to the stockholders 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 Six Months Ended
----------------------------------------
June 30, 2013 June 30, 2013
----------------------------------------
(unaudited) (unaudited)
$ Per $ Per
$ Share(1) $ Share(1)
----------------------------------------------------------------------------
Net income - GAAP basis 87,534 127,289
Adjust for: Net income attributable
to non-controlling interests (76,167) (122,058)
----------------------------------------------------------------------------
Net income attributable to
stockholders of Teekay 11,367 0.16 5,231 0.07
Add (subtract) specific items
affecting net loss:
Unrealized gains from derivative
instruments (2) (106,244) (1.49) (127,065) (1.79)
Foreign exchange gain (3) (447) (0.01) (114) -
Asset impairments, net of loss
(gain) on sale of vessels and
equipment (4) 5,701 0.07 8,898 0.13
Restructuring charges(5) 1,789 0.03 3,843 0.05
Other - net(6) 4,899 0.07 7,302 0.10
Non-controlling interests' share
of items above(7) 49,611 0.70 56,898 0.80
----------------------------------------------------------------------------
Total adjustments (44,691) (0.63) (50,238) (0.71)
----------------------------------------------------------------------------
Adjusted net loss attributable to
stockholders of Teekay (33,324) (0.47) (45,007) (0.63)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Fully diluted per share amounts.
(2) Reflects the unrealized gains or 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, and the ineffective portion of foreign currency forward
contracts designated as hedges for accounting purposes.
(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 Norwegian Kroner bonds. Nearly all of the
Company's foreign currency exchange gains and losses are unrealized.
(4) Relates to allowances provided against investments in term loans, gain
on sale of equipment, and loss on sale of a conventional tanker.
(5) Restructuring charges relate to the reorganization of the Company's
marine operations.
(6) Other primarily relates to recognition of unrealized loss on sale of
marketable securities, pension fund closure, and realized loss on foreign
exchange forward contracts relating to certain capital acquisition
expenditures.
(7) Items affecting net income (loss) include items from the Company's
wholly-owned subsidiaries, its consolidated non-wholly-owned subsidiaries
and its proportionate share of items from equity accounted for investments.
The specific items affecting net income (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 arrive at the non-controlling interests' share of the
amount. The amount identified as "non-controlling interests' share of items
listed above" in the table above is the cumulative amount of the non-
controlling interests' proportionate share of items listed in the table.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY BALANCE SHEET AS AT JUNE 30, 2014
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(unaudited)
Teekay Teekay Teekay
Offshore LNG Tankers
---------------------------------------
ASSETS
Cash and cash equivalents 251,561 121,658 21,764
Other current assets 191,286 26,287 28,280
Restricted cash - 498,400 -
Vessels and equipment 2,931,060 1,761,411 841,013
Advances on newbuilding contracts and
conversion costs 114,087 117,778 -
Derivative assets 6,455 118,755 4,026
Investment in equity accounted
investees 58,338 649,703 35,975
Investment in direct financing leases 79,446 694,581 -
Other assets 53,829 133,862 13,244
Advances to affiliates 55,843 21,036 33,197
Equity investment in subsidiaries - - -
Intangibles and goodwill 137,568 127,755 -
---------------------------------------
TOTAL ASSETS 3,879,473 4,271,226 977,499
---------------------------------------
---------------------------------------
LIABILITIES AND EQUITY
Accounts payable and accrued
liabilities 162,001 68,234 18,359
Advances from affiliates 75,577 46,271 8,707
Current portion of long-term debt 339,087 227,312 51,959
Long-term debt 2,204,394 2,142,317 557,439
Derivative liabilities 217,817 256,493 22,900
In process revenue contracts 94,974 4,217 -
Other long-term liabilities 27,441 130,946 5,444
Redeemable non-controlling interest 15,149 - -
Equity:
Non-controlling interests (1) 55,344 40,448 -
Equity attributable to
stockholders/unitholders of
publicly-listed entities 687,689 1,354,988 312,691
---------------------------------------
TOTAL LIABILITIES AND EQUITY 3,879,473 4,271,226 977,499
---------------------------------------
---------------------------------------
NET DEBT(2) 2,291,920 1,749,571 587,634
---------------------------------------
---------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY BALANCE SHEET AS AT JUNE 30, 2014
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(unaudited)
Teekay Consolidation
Parent Adjustments Total
---------------------------------------
ASSETS
Cash and cash equivalents 353,917 - 748,900
Other current assets 397,618 - 643,471
Restricted cash 4,643 - 503,043
Vessels and equipment 891,211 - 6,424,695
Advances on newbuilding contracts and
conversion costs 1,171,985 - 1,403,850
Derivative assets 2,747 - 131,983
Investment in equity accounted
investees 73,384 (9,700) 807,700
Investment in direct financing leases (1) - 774,026
Other assets 147,379 - 348,314
Advances to affiliates (110,076) - -
Equity investment in subsidiaries 433,915 (433,915) -
Intangibles and goodwill 4,406 - 269,729
---------------------------------------
TOTAL ASSETS 3,371,128 (443,615) 12,055,711
---------------------------------------
---------------------------------------
LIABILITIES AND EQUITY
Accounts payable and accrued
liabilities 323,385 - 571,979
Advances from affiliates (130,555) - -
Current portion of long-term debt 102,959 - 721,317
Long-term debt 1,672,074 - 6,576,224
Derivative liabilities 52,305 - 549,515
In process revenue contracts 60,625 - 159,816
Other long-term liabilities 203,867 - 367,698
Redeemable non-controlling interest - - 15,149
Equity:
Non-controlling interests (1) 2,040 1,911,753 2,009,585
Equity attributable to
stockholders/unitholders of
publicly-listed entities 1,084,428 (2,355,368) 1,084,428
---------------------------------------
TOTAL LIABILITIES AND EQUITY 3,371,128 (443,615) 12,055,711
---------------------------------------
---------------------------------------
NET DEBT(2) 1,416,473 - 6,045,598
---------------------------------------
---------------------------------------
(1) 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.
(2) Net debt represents current and long-term debt less cash and, if
applicable, current and long-term restricted cash.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY STATEMENT OF (LOSS) INCOME FOR THE THREE MONTHS ENDED JUNE 30, 2014
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(unaudited)
Teekay Teekay Teekay Teekay
Offshore LNG Tankers Parent
------------------------------------------------
Revenues 241,402 101,323 44,433 94,716
------------------------------------------------
Voyage expenses 26,256 1,167 3,612 3,919
Vessel operating expenses 88,184 24,320 23,585 65,625
Time-charter hire expense 4,975 - 1,112 32,654
Depreciation and
amortization 48,474 23,530 12,425 18,944
General and administrative 18,054 6,254 3,163 8,552
Loan loss recoveries - - - (2,521)
(Gain) loss on sale of
vessels and equipment - - (9,955) 340
Restructuring charges (821) - - 577
------------------------------------------------
Total operating expenses 185,122 55,271 33,942 128,090
------------------------------------------------
Income (loss) from vessel
operations 56,280 46,052 10,491 (33,374)
------------------------------------------------
Interest expense (21,568) (15,068) (2,274) (10,746)
Interest income 190 572 60 (29)
Realized and unrealized
losses on derivative
instruments (38,144) (16,335) (3,614) (17,238)
Income tax expense (182) (375) (39) (2,597)
Equity income (loss) 2,388 32,924 15 (56)
Equity in earnings of
subsidiaries (1) - - - 21,306
Foreign exchange (loss) gain (2,836) (66) (37) 893
Other - net 72 208 (13) (1,001)
------------------------------------------------
Net (loss) income (3,800) 47,912 4,589 (42,842)
Less: Net income
attributable to non-
controlling interests (2) (1,654) (4,263) - (145)
------------------------------------------------
Net (loss) income
attributable to
stockholders/unitholders
of publicly-listed entities (5,454) 43,649 4,589 (42,987)
------------------------------------------------
------------------------------------------------
CFVO - Consolidated(3)(4) 102,774 71,650 12,961 (23,277)
CFVO - Equity Investments(5) 7,135 50,894 1,278 1,011
CFVO - Total 109,909 122,544 14,239 (22,266)
------------------------------------------------
------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY STATEMENT OF (LOSS) INCOME FOR THE THREE MONTHS
ENDED JUNE 30, 2014
(in thousands of U.S. dollars)
-------------------------------------------------------
-------------------------------------------------------
(unaudited)
Consolidation
Adjustments Total
---------------------------
Revenues (29,620) 452,254
---------------------------
Voyage expenses (1,515) 33,439
Vessel operating expenses - 201,714
Time-charter hire expense (29,027) 9,714
Depreciation and
amortization - 103,373
General and administrative 922 36,945
Loan loss recoveries - (2,521)
(Gain) loss on sale of
vessels and equipment - (9,615)
Restructuring charges - (244)
---------------------------
Total operating expenses (29,620) 372,805
---------------------------
Income (loss) from vessel
operations - 79,449
---------------------------
Interest expense - (49,656)
Interest income - 793
Realized and unrealized
losses on derivative
instruments - (75,331)
Income tax expense - (3,193)
Equity income (loss) - 35,271
Equity in earnings of
subsidiaries (1) (21,306) -
Foreign exchange (loss) gain - (2,046)
Other - net - (734)
---------------------------
Net (loss) income (21,306) (15,447)
Less: Net income
attributable to non-
controlling interests (2) (21,478) (27,540)
---------------------------
Net (loss) income
attributable to
stockholders/unitholders
of publicly-listed entities (42,784) (42,987)
---------------------------
---------------------------
CFVO - Consolidated(3)(4) - 164,108
CFVO - Equity Investments(5) - 60,318
CFVO - Total - 224,426
---------------------------
---------------------------
(1) Teekay Corporation's proportionate share of the net earnings of its
publicly-traded subsidiaries.
(2) Net (income) loss attributable to non-controlling interests in the
Teekay Offshore and Teekay LNG columns represent the joint venture partners'
share of the net income (loss) of their respective joint ventures. Net
(income) loss attributable to non-controlling interest in the Consolidation
Adjustments column represents the public's share of the net income (loss) of
Teekay's publicly-traded subsidiaries.
(3) 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 and losses on the sale
of vessels, adjustments for direct financing leases to a cash basis, and
unrealized gains and losses relating to derivatives, but includes realized
gains and losses on the settlement of foreign currency forward contracts.
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.
(4) In addition to the CFVO generated by its directly owned and chartered-in
assets, Teekay Parent also receives cash dividends and distributions from
its publicly-traded subsidiaries. For the three months ended June 30, 2014,
Teekay Parent received cash dividends and distributions from these
subsidiaries totaling $43.7 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.
(5) 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 a reconciliation of this non-
GAAP measure as used in this release to the most directly comparable GAAP
financial measure.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY STATEMENT OF INCOME (LOSS) FOR THE SIX MONTHS ENDED JUNE 30, 2014
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(unaudited)
Teekay Teekay Teekay Teekay
Offshore LNG Tankers Parent
------------------------------------------------
Revenues 500,636 202,813 106,192 207,221
------------------------------------------------
Voyage expenses 59,710 2,500 5,051 4,675
Vessel operating expenses 176,314 48,576 46,379 131,631
Time-charter hire expense 16,387 - 2,164 63,930
Depreciation and
amortization 96,962 47,640 24,927 37,302
General and administrative 32,903 12,662 6,355 21,057
Asset impairments and
provisions - - - (2,521)
(Gain) loss on sale of
vessels and equipment - - (9,955) 502
Restructuring charges (262) - - 657
------------------------------------------------
Total operating expenses 382,014 111,378 74,921 257,233
------------------------------------------------
Income (loss) from vessel
operations 118,622 91,435 31,271 (50,012)
------------------------------------------------
Interest expense (40,488) (29,899) (4,621) (23,981)
Interest income 367 1,220 198 791
Realized and unrealized
losses on derivative
instruments (74,776) (23,856) (1,970) (21,977)
Income tax expense (1,445) (770) (94) (3,682)
Equity income 6,091 53,297 2,609 768
Equity in earnings of
subsidiaries (1) - - - 50,288
Foreign exchange (loss) gain (3,611) (845) (15) 1,531
Other - net 462 426 3,643 2,986
------------------------------------------------
Net income (loss) 5,222 91,008 31,021 (43,288)
Less: Net income
attributable to non-
controlling interests (2) (3,333) (9,113) - (187)
------------------------------------------------
Net income (loss)
attributable to
stockholders/unitholders of
publicly-listed entities 1,889 81,895 31,021 (43,475)
------------------------------------------------
------------------------------------------------
CFVO - Consolidated(3)(4) 210,923 143,084 46,243 (28,763)
CFVO - Equity Investments(5) 15,082 99,034 2,701 1,152
CFVO - Total 226,005 242,118 48,944 (27,611)
------------------------------------------------
------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY STATEMENT OF INCOME (LOSS) FOR THE SIX MONTHS
ENDED JUNE 30, 2014
(in thousands of U.S. dollars)
-------------------------------------------------------
-------------------------------------------------------
(unaudited)
Consolidation
Adjustments Total
---------------------------
Revenues (58,114) 958,748
---------------------------
Voyage expenses (3,485) 68,451
Vessel operating expenses - 402,900
Time-charter hire expense (56,475) 26,006
Depreciation and
amortization - 206,831
General and administrative 1,846 74,823
Asset impairments and
provisions - (2,521)
(Gain) loss on sale of
vessels and equipment - (9,453)
Restructuring charges - 395
---------------------------
Total operating expenses (58,114) 767,432
---------------------------
Income (loss) from vessel
operations - 191,316
---------------------------
Interest expense - (98,989)
Interest income - 2,576
Realized and unrealized
losses on derivative
instruments - (122,579)
Income tax expense - (5,991)
Equity income - 62,765
Equity in earnings of
subsidiaries (1) (50,288) -
Foreign exchange (loss) gain - (2,940)
Other - net - 7,517
---------------------------
Net income (loss) (50,288) 33,675
Less: Net income
attributable to non-
controlling interests (2) (64,517) (77,150)
---------------------------
Net income (loss)
attributable to
stockholders/unitholders of
publicly-listed entities (114,805) (43,475)
---------------------------
---------------------------
CFVO - Consolidated(3)(4) - 371,487
CFVO - Equity Investments(5) - 117,969
CFVO - Total - 489,456
---------------------------
---------------------------
(1) Teekay Corporation's proportionate share of the net earnings of its
publicly-traded subsidiaries.
(2) Net (income) loss attributable to non-controlling interests in the
Teekay Offshore and Teekay LNG columns represent the joint venture partners'
share of the net income (loss) of their respective joint ventures. Net
(income) loss attributable to non-controlling interest in the Consolidation
Adjustments column represents the public's share of the net income (loss) of
Teekay's publicly-traded subsidiaries.
(3) 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, adjustments for direct financing leases to a cash basis, and
unrealized gains and losses relating to derivatives, but includes realized
gains and losses on the settlement of foreign currency forward contracts.
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 financial
measure as used in this release to the most directly comparable GAAP
financial measure.
(4) In addition to Teekay Parent's CFVO, Teekay Parent also receives cash
dividends and distributions from its publicly-traded subsidiaries. For the
six months ended June 30, 2014, Teekay Parent received cash dividends and
distributions from these subsidiaries totaling $87.0 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.
(5) 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 a reconciliation of this non-
GAAP measure as used in this release to the most directly comparable GAAP
measure.
TEEKAY CORPORATION
APPENDIX C - SUPPLEMENTAL FINANCIAL INFORMATION
TEEKAY PARENT SUMMARY OPERATING RESULTS
FOR THE THREE MONTHS ENDED JUNE 30, 2014
(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 (loss) income 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 Teekay
Conventional Conventional Parent
Tankers Tankers FPSOs Other (1) Total
-------------------------------------------------------
Revenues 5,222 17,041 47,170 25,283 94,716
Voyage expenses 3,200 686 - 33 3,919
Vessel operating
expenses 989 5,643 51,832 7,161 65,625
Time-charter hire
expense - 14,710 6,006 11,938 32,654
Depreciation and
amortization 710 - 17,746 488 18,944
General and
administrative 144 820 5,826 3,362 10,152
Success fee from
daughter - - - (1,600) (1,600)
Loan loss
recoveries(2) - - (2,521) - (2,521)
Loss on sale of
vessels and
equipment (2) 340 - - - 340
Restructuring charges - - - 577 577
-------------------------------------------------------
Total operating
expenses 5,383 21,859 78,889 21,959 128,090
-------------------------------------------------------
(Loss) income from
vessel operations (161) (4,818) (31,719) 3,324 (33,374)
-------------------------------------------------------
Reconciliation of (loss) income from vessel operations to cash flow from
vessel operations
(Loss) income from
vessel operations (161) (4,818) (31,719) 3,324 (33,374)
Depreciation and
amortization 710 - 17,746 488 18,944
Loan loss
recoveries(2) - - (2,521) - (2,521)
Loss on sale of
vessels and
equipment (2) 340 - - - 340
Amortization of in-
process revenue
contracts and other - - (6,580) - (6,580)
Realized losses from
the settlements of
non-designated
derivative
instruments (34) - (52) - (86)
-------------------------------------------------------
CFVO -
Consolidated(3)(4) 855 (4,818) (23,126) 3,812 (23,277)
CFVO - Equity(5) 859 - 211 (59) 1,011
-------------------------------------------------------
CFVO - Total 1,714 (4,818) (22,915) 3,753 (22,266)
-------------------------------------------------------
-------------------------------------------------------
(1) Includes results of two chartered-in LNG carriers owned by Teekay LNG
and one chartered-in FSO unit owned by Teekay Offshore, fees earned from
managing TIL vessel transactions of $4.0 million included in revenues, and a
one-time $1.6 million success fee payment received from Teekay Offshore upon
the acquisition of ALP Maritime Services B.V. in March 2014.
(2) Teekay Parent recognized a loss on sale of four conventional tankers to
TIL and a recovery of a receivable for an FPSO front-end engineering and
design study which had previously been provided for.
(3) 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 and losses on the sale
of vessels, adjustments for direct financing leases to a cash basis, and
unrealized gains and losses relating to derivatives, but includes realized
gains and losses on the settlement of foreign currency forward contracts.
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.
(4) In addition to the CFVO generated by its directly owned and chartered-in
assets, Teekay Parent also receives cash dividends and distributions from
its publicly-traded subsidiaries. For the three months ended June 30, 2014,
Teekay Parent received cash dividends and distributions from these
subsidiaries totaling $43.7 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.
(5) 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 C - SUPPLEMENTAL FINANCIAL INFORMATION
TEEKAY PARENT SUMMARY OPERATING RESULTS
FOR THE SIX MONTHS ENDED JUNE 30, 2014
(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 Teekay
Conventional Conventional Parent
Tankers Tankers FPSOs Other (1) Total
-------------------------------------------------------
Revenues 13,187 33,847 106,553 53,634 207,221
Voyage expenses 3,673 958 - 44 4,675
Vessel operating
expenses 3,342 11,049 104,923 12,317 131,631
Time-charter hire
expense - 27,922 13,372 22,636 63,930
Depreciation and
amortization 790 - 36,081 431 37,302
General and
administrative 531 1,555 11,551 9,020 22,657
Success fee from
daughter - - - (1,600) (1,600)
Loan loss
recoveries(2) - - (2,521) - (2,521)
Loss on sale of
vessels and
equipment(2) 502 - - - 502
Restructuring charges - - - 657 657
-------------------------------------------------------
Total operating
expenses 8,838 41,484 163,406 43,505 257,233
-------------------------------------------------------
-------------------------------------------------------
Income (loss) from
vessel operations 4,349 (7,637) (56,853) 10,129 (50,012)
-------------------------------------------------------
Reconciliation of income (loss) from vessel operations to cash flow from
vessel operations
Income (loss) from
vessel operations 4,349 (7,637) (56,853) 10,129 (50,012)
Depreciation and
amortization 790 - 36,081 431 37,302
Loan loss
recoveries(2) - - (2,521) - (2,521)
Loss on sale of
vessels and
equipment(2) 502 - - - 502
Amortization of in-
process revenue
contracts and other - - (13,160) - (13,160)
Realized losses from
the settlements of
non-designated
derivative
instruments (296) - (578) - (874)
-------------------------------------------------------
CFVO -
Consolidated(3)(4) 5,345 (7,637) (37,031) 10,560 (28,763)
CFVO - Equity(5) 1,705 - (640) 87 1,152
-------------------------------------------------------
CFVO - Total 7,050 (7,637) (37,671) 10,647 (27,611)
-------------------------------------------------------
-------------------------------------------------------
(1) Includes the results of two chartered-in LNG carriers owned by Teekay
LNG and one chartered-in FSO unit owned by Teekay Offshore, interest income
received from an investment in term loan, fees earned from managing TIL
vessel transactions of $4.0 million included in revenues, and a one-time
$1.6 million success fee payment received from Teekay Offshore upon the
acquisition of ALP Maritime Services B.V. in March 2014.
(2) Teekay Parent recognized a loss relating to the sale of four
conventional tankers to TIL and a recovery of a receivable for an FPSO
front-end engineering and design study which had previously been provided
for.
(3) 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 and losses on the sale
of vessels, adjustments for direct financing leases to a cash basis, and
unrealized gains and losses relating to derivatives, but includes realized
gains and losses on the settlement of foreign currency forward contracts.
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.
(4) In addition to the CFVO generated by its directly owned and chartered-in
assets, Teekay Parent also receives cash dividends and distributions from
its publicly-traded subsidiaries. For the six months ended June 30, 2014,
Teekay Parent received cash dividends and distributions from these
subsidiaries totaling $87.0 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.
(5) 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 June 30, 2014, March 31, 2014, December 31, 2013, September 30, 2013, and June 30, 2013. The Company defines free cash flow, a non-GAAP financial measure, as cash flow from vessel operations attributed to its directly-owned and in-chartered assets, distributions received as a result of ownership interests in its publicly-traded subsidiaries (Teekay LNG, Teekay Offshore, and Teekay Tankers), net of interest expense and drydock expenditures in the respective period. For a reconciliation of Teekay Parent cash flow from vessel operations for the three months ended June 30, 2014 to the most directly comparable financial measure under GAAP, please refer to Appendix C to this release. For a reconciliation of Teekay Parent cash flow from vessel operations to the most directly comparable GAAP financial measure for the three months ended March 31, 2014, December 31, 2013, September 30, 2013, and June 30, 2013, please see Appendix E to this release. Teekay Parent free cash flow, 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.
Three Months Ended
--------------------------------------------------
December September
June 30, March 31, 31, 30, June 30,
--------------------------------------------------
2014 2014 2013 2013 2013
--------------------------------------------------
Teekay Parent cash flow
from vessel operations
(1)
Owned Conventional Tankers 855 4,490 232 883 (380)
In-Chartered Conventional
Tankers (2) (4,818) (2,819) (9,292) (8,672) (18,436)
FPSOs (23,126) (13,906) (4,932) (24,214) (13,407)
Other 3,812 6,750 (2,959) (2,528) (3,337)
--------------------------------------------------
Total (23,277) (5,486) (16,951) (34,531) (35,560)
Daughter company
distributions to Teekay
Parent (3)
Common shares/units (4)
Teekay LNG Partners 17,439 17,439 17,439 17,016 17,016
Teekay Offshore Partners 12,819 12,819 12,819 12,507 12,507
Teekay Tankers (5) 629 629 629 629 629
--------------------------------------------------
Total 30,887 30,887 30,887 30,152 30,152
General partner interest
Teekay LNG Partners 7,883 7,568 7,566 6,320 5,946
Teekay Offshore Partners 4,880 4,868 4,867 3,671 3,671
--------------------------------------------------
Total 12,763 12,436 12,433 9,991 9,617
Total Teekay Parent cash
flow before interest and
dry dock expenditures 20,373 37,837 26,369 5,612 4,209
Less:
Net interest expense (6) (15,015) (16,151) (12,039) (16,576) (17,017)
Dry dock expenditures (378) (549) (2,056) (607) -
--------------------------------------------------
TOTAL TEEKAY PARENT FREE
CASH FLOW 4,980 21,137 12,274 (11,571) (12,808)
--------------------------------------------------
--------------------------------------------------
(1) Cash flow from vessel operations (CFVO) represents income from vessel
operations before depreciation and amortization expense, vessel/goodwill
write downs, gains or losses on the sale of vessels, adjustments for direct
financing leases to a cash basis, and unrealized gains and losses relating
to derivatives, but includes realized gains and losses on the settlement of
foreign currency forward contracts. CFVO is a non-GAAP financial measure
used by certain investors to measure the financial performance of shipping
companies. For further details for the three months ended June 30, 2014,
including a reconciliation of this non-GAAP financial measure to the most
directly comparable GAAP financial measure, please refer to Appendix C to
this release; for a reconciliation of this non-GAAP financial measure to the
most directly comparable GAAP financial measure for the three months ended
March 31, 2014, December 31, 2013, September 30, 2013, and June 30, 2013,
please refer to Appendix E to this release.
(2) Includes charter termination fees of $4.5 million paid to Teekay
Offshore during the three months ended June 30, 2013.
(3) Cash dividend and distribution cash flows are shown on an accrual basis
for dividends and distributions declared for the respective period.
(4) 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
----------------------------------------------------------
December September
June 30, March 31, 31, 30, June 30,
----------------------------------------------------------
2014 2014 2013 2013 2013
----------------------------------------------------------
Teekay LNG
Partners
Distribution per
common unit $ 0.6918 $ 0.6918 $ 0.6918 $ 0.6750 $ 0.6750
Common units
owned by Teekay
Parent 25,208,274 25,208,274 25,208,274 25,208,274 25,208,274
------------------------------------------------------------
Total
distribution $17,439,084 $17,439,084 $17,439,084 $17,015,585 $17,015,585
Teekay Offshore
Partners
Distribution per
common unit $ 0.5384 $ 0.5384 $ 0.5384 $ 0.5253 $ 0.5253
Common units
owned by Teekay
Parent 23,809,468 23,809,468 23,809,468 23,809,468 23,809,468
------------------------------------------------------------
Total
distribution $12,819,018 $12,819,018 $12,819,018 $12,507,114 $12,507,114
Teekay Tankers
Ltd.
Dividend per
share $ 0.03 $ 0.03 $ 0.03 $ 0.03 $ 0.03
Shares owned by
Teekay Parent
(5) 20,976,530 20,976,530 20,976,530 20,976,530 20,976,530
------------------------------------------------------------
Total dividend $ 629,296 $ 629,296 $ 629,296 $ 629,296 $ 629,296
(5) Includes Class A and Class B shareholdings.
(6) 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.
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 June 30, 2014 and June 30, 2013. 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 unrealized gains or losses relating to derivatives but includes realized gains or losses on the settlement of foreign exchange forward contracts. 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 June 30, 2014
-----------------------------------------------------------
(unaudited)
-----------------------------------------------------------
Teekay Teekay
Offshore Teekay LNG Teekay Teekay Corporation
Partners LP Partners LP Tankers Ltd. Parent Consolidated
----------------------------------------------------------------------------
Income (loss)
from vessel
operations 56,280 46,052 10,491 (33,374) 79,449
Depreciation and
amortization 48,474 23,530 12,425 18,944 103,373
Amortization of
in process
revenue
contracts and
other (3,177) (2,188) - (6,580) (11,945)
Realized gains
(losses) from
the settlements
of non
designated
derivative
instruments 196 - - (86) 110
Loan loss
recoveries - - - (2,521) (2,521)
(Gain) loss on
sale of vessels
and equipment - - (9,955) 340 (9,615)
Cash flow from
time-charter
contracts, net
of revenue
accounted for as
direct finance
leases 1,001 4,256 - - 5,257
----------------------------------------------------------------------------
Cash flow from
vessel
operations -
Consolidated 102,774 71,650 12,961 (23,277) 164,108
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended June 30, 2013
-----------------------------------------------------------
(unaudited)
-----------------------------------------------------------
Teekay
Offshore Teekay
Partners LP Teekay LNG Teekay Teekay Corporation
(1) Partners LP Tankers Ltd. Parent Consolidated
----------------------------------------------------------------------------
Income (loss)
from vessel
operations 34,355 40,681 (5,534) (40,125) 29,377
Depreciation and
amortization 50,662 25,156 11,921 22,030 109,769
Amortization of
in process
revenue
contracts and
other (3,122) (1,998) (240) (11,184) (16,544)
Unrealized losses
from the change
in fair value of
designated
derivative
instruments - - - 38 38
Realized gains
(losses) from
the settlements
of non
designated
derivative
instruments 218 - - (228) (10)
Asset impairments
/ net loss
(gain) on vessel
sales 7,782 - 4,511 (6,592) 5,701
Cash flow from
time-charter
contracts, net
of revenue
accounted for as
direct finance
leases 821 1,634 - - 2,455
Dropdown
predecessor cash
flow (501) - - 501 -
----------------------------------------------------------------------------
Cash flow from
vessel
operations -
Consolidated(2) 90,215 65,473 10,658 (35,560) 130,786
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) The results of Teekay Offshore include the results from both continuing
and discontinued operations.
(2) Excludes the cash flow from vessel operations 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.
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 June 30, 2014 and June 30, 2013. 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 unrealized gains or losses relating to derivatives but includes realized gains or losses on the settlement of foreign exchange forward contracts. 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
June 30, 2014 June 30, 2013
------------------------------------------------
(unaudited) (unaudited)
------------------------------------------------
At Company's At Company's
100% Portion(1) 100% Portion(2)
----------------------------------------------------------------------------
Revenues 237,518 104,804 216,205 100,768
Vessel and other operating
expenses 109,616 45,244 97,542 46,231
Depreciation and
amortization 33,902 15,805 23,838 12,102
Gain on sale of vessels (19,543) (9,772) - -
----------------------------------------------------------------------------
Income from vessel
operations of equity
accounted vessels 113,543 53,527 94,825 42,435
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Interest expense (23,839) (10,547) (17,488) (7,960)
Realized and unrealized gain
(loss) on derivative
instruments (20,239) (7,237) 32,774 11,967
Other income - net (815) (472) 1,683 930
----------------------------------------------------------------------------
Other items (44,893) (18,256) 16,969 4,937
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Net income / equity income
of equity accounted vessels 68,650 35,271 111,794 47,372
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Income from vessel
operations of equity
accounted vessels 113,543 53,527 94,825 42,435
Depreciation and
amortization 33,902 15,805 23,838 12,102
Gain on sale of vessels (19,543) (9,772) - -
Cash flow from time-charter
contracts net of revenue
accounted for as direct
finance lease 7,697 2,792 7,161 2,603
Amortization of in-process
revenue contracts and other (4,002) (2,034) (8,386) (4,297)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Cash flow from vessel
operations of equity
accounted vessels(3) 131,597 60,318 117,438 52,843
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) The Company's proportionate share of its equity accounted vessels and
other investments ranges from 13 percent to 52 percent.
(2) The Company's proportionate share of its equity accounted vessels and
other investments ranges from 33 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 March 31, 2014, December 31, 2013, September 30, 2013, and June 30, 2013. 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 unrealized gains or losses relating to derivatives but includes realized gains or losses on the settlement of foreign exchange forward contracts. 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, 2014
-------------------------------------------------------
(unaudited)
-------------------------------------------------------
Owned In-chartered Teekay
Conventional Conventional Parent
Tankers Tankers FPSOs Other Total
----------------------------------------------------------------------------
Teekay Parent income
(loss) from vessel
operations 4,510 (2,819) (25,135) 6,807 (16,638)
Depreciation and
amortization 80 - 18,335 (57) 18,358
Loss on sale of
vessels and
equipment 162 - - - 162
Amortization of in
process revenue
contracts and other - - (6,580) - (6,580)
Realized losses from
the settlements of
non-designated
foreign derivative
instruments (262) - (526) - (788)
----------------------------------------------------------------------------
Cash flow from vessel
operations -
Teekay Parent 4,490 (2,819) (13,906) 6,750 (5,486)
----------------------------------------------------------------------------
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Three Months Ended December 31, 2013
-------------------------------------------------------
(unaudited)
-------------------------------------------------------
Owned In-chartered Teekay
Conventional Conventional Parent
Tankers Tankers FPSOs Other Total
----------------------------------------------------------------------------
Teekay Parent (loss)
income from vessel
operations (93,160) (9,292) (15,452) 6,171 (111,733)
Depreciation and
amortization 2,602 - 18,995 (475) 21,140
Asset impairments and
provisions
(recoveries) 90,813 - 2,634 (8,713) 84,734
Gain on sale of
vessel - - - 40 40
Amortization of in
process revenue
contracts and other - - (10,691) - (10,691)
Realized losses from
the settlements of
non-designated
foreign exchange
forward contracts (23) - (418) - (441)
----------------------------------------------------------------------------
Cash flow from vessel
operations -
Teekay Parent 232 (9,292) (4,932) (2,959) (16,951)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended September 30, 2013
-------------------------------------------------------
(unaudited)
-------------------------------------------------------
Owned In-chartered Teekay
Conventional Conventional Parent
Tankers Tankers FPSOs Other Total
----------------------------------------------------------------------------
Teekay Parent loss
from vessel
operations (1,634) (8,672) (32,692) (1,172) (44,170)
Depreciation and
amortization 2,582 - 19,670 (1,433) 20,819
Loss provision - - - 1,141 1,141
Gain on sale of
vessel - - - (161) (161)
Amortization of in
process revenue
contracts and other - - (10,708) - (10,708)
Unrealized losses
from the change in
fair value of
designated foreign
exchange forward
contracts 19 - - - 19
Realized losses from
the settlements of
non-designated
foreign exchange
forward contracts (84) - (484) (903) (1,471)
----------------------------------------------------------------------------
Cash flow from vessel
operations -
Teekay Parent 883 (8,672) (24,214) (2,528) (34,531)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Three Months Ended June 30, 2013
-------------------------------------------------------
(unaudited)
-------------------------------------------------------
Owned In-chartered Teekay
Conventional Conventional Parent
Tankers Tankers FPSOs Other Total
----------------------------------------------------------------------------
Teekay Parent (loss)
income from vessel
operations (2,922) (18,203) (21,883) 2,883 (40,125)
Depreciation and
amortization 2,582 (233) 20,646 (965) 22,030
Asset impairments/net
(gain) on vessel
sales - - (1,337) (5,255) (6,592)
Amortization of in
process revenue
contracts and other - - (11,184) - (11,184)
Unrealized (gains)
losses from the
change in fair value
of designated
foreign exchange
forward contracts 38 - - - 38
Realized (losses)
gains from the
settlements of non-
designated foreign
exchange forward
contracts (78) - (150) - (228)
Dropdown predecessor
cash flow - - 501 - 501
----------------------------------------------------------------------------
Cash flow from vessel
operations -
Teekay Parent (380) (18,436) (13,407) (3,337) (35,560)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
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 and six months ended June 30, 2014 and June 30, 2013. 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 June 30, 2014
------------------------------------------------------------
Teekay Offshore Teekay LNG Teekay Teekay
Partners LP Partners LP Tankers Ltd. Parent
----------------------------------------------------------------------------
Revenues 241,402 101,323 44,433 94,716
Voyage expense (26,256) (1,167) (3,612) (3,919)
----------------------------------------------------------------------------
Net revenues 215,146 100,156 40,821 90,797
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Six Months
Three Months Ended June 30, Ended
2014 June 30, 2014
---------------------------------------------
Teekay Teekay
Consolidation Corporation Corporation
Adjustments Consolidated Consolidated
-------------------------------------------------------------
Revenues (29,620) 452,254 958,748
Voyage expense 1,515 (33,439) (68,451)
-------------------------------------------------------------
Net revenues (28,105) 418,815 890,297
-------------------------------------------------------------
-------------------------------------------------------------
Three Months Ended June 30, 2013
------------------------------------------------------------
Teekay Offshore Teekay LNG Teekay Teekay
Partners LP (1) Partners LP Tankers Ltd. Parent
----------------------------------------------------------------------------
Revenues 229,862 96,619 43,492 97,604
Voyage expense (23,233) (1,224) (2,449) (510)
----------------------------------------------------------------------------
Net revenues 206,629 95,395 41,043 97,094
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Six Months
Three Months Ended June 30, Ended
2013 June 30, 2013
---------------------------------------------
Teekay Teekay
Consolidation Corporation Corporation
Adjustments Consolidated Consolidated
-------------------------------------------------------------
Revenues (36,870) 430,707 881,744
Voyage expense 1,262 (26,154) (52,469)
-------------------------------------------------------------
Net revenues (35,608) 404,553 829,275
-------------------------------------------------------------
-------------------------------------------------------------
(1) The results of Teekay Offshore include the results from both continuing
and discontinued operations.
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 June 30, 2014, March 31, 2014, December 31, 2013, September 30, 2013, and June 30, 2013. 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
--------------------------------------------------
December September
June 30, March 31, 31, 30, June 30,
2014 2014 2013 2013 2013
--------------------------------------------------
Interest expense (49,656) (49,333) (48,382) (45,817) (44,687)
Interest income 793 1,783 5,129 1,543 2,018
----------------------------------------------------------------------------
Net interest expense -
consolidated (48,863) (47,550) (43,253) (44,274) (42,669)
Less:
Non-Teekay Parent net
interest expense (38,088) (35,135) (35,130) (31,604) (29,540)
----------------------------------------------------------------------------
Interest expense net of
interest income - Teekay
Parent (10,775) (12,415) (8,123) (12,670) (13,129)
Add:
Teekay Parent realized
losses on interest rate
swaps (1) (4,240) (3,736) (3,916) (3,906) (3,888)
----------------------------------------------------------------------------
Net interest expense -
Teekay Parent (15,015) (16,151) (12,039) (16,576) (17,017)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(1) Realized losses on interest rate swaps for the three months ended March
31, 2014 excludes a realized gain on the termination of a swap agreement.
Realized losses on interest rate swaps for the three months ended June 30,
2013 excludes a realized loss on the termination of a swap agreement prior
to the acquisition of the Voyageur FPSO unit in May 2013.
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 market conditions; the timing and certainty of the sale of assets from Teekay Parent to its daughter entities and the impact on the cash flows received by Teekay Parent and on Teekay Parent's balance sheet as a result of such transactions; expected growth of Teekay Offshore and Teekay LNG and its impact on Teekay Parent; the total cost and timing for the delivery of newbuilding and conversion projects and the commencement of associated time-charter contracts; the timing and certainty of entering into charter contracts for the FAU newbuildings prior to their deliveries; Teekay Offshore's intention to exercise its option on the third FAU unit; Teekay LNG's agreement to provide, through a new 50/50 joint venture with China LNG, six icebreaker LNG carriers for the Yamal LNG project; the timing of the start-up of the Yamal LNG project and the expected total LNG production capacity of the project, if completed; the timing and certainty of Teekay Offshore's joint venture with Odebrecht completing final contract negotiations for the Libra FPSO project with Petrobras; and the completion and terms of the proposed agreement between Teekay and CarVal relating to a new dry bulk shipping company.
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 tanker newbuilding orders or greater or less than anticipated rates of tanker 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; 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; failure by Teekay Offshore to secure charter contracts for FAU newbuildings; failure by Teekay Offshore to complete documentation related to the third FAU unit; potential failure of the Yamal LNG Project to be completed for any reason, including due to lack of funding as a result of existing or future sanctions against Russian entities and individuals, which may affect partners in the project; potential delays or cancellation of the Yamal LNG project; failure by Teekay Offshore's joint venture with Odebrecht to complete final contract negotiations with Petrobras for the Libra FPSO project; failure of Teekay and CarVal to reach agreement on the formation and management relating to a new dry bulk shipping company; potential delays in the commencement of operations of the Petrojarl Knarr FPSO unit; the inability of the Company to complete vessel sale transactions to its public-traded subsidiaries or to third parties; 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, 2013.
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:
Teekay Corporation
Ryan Hamilton
Investor Relations Enquiries
+1 (604) 844-6654
www.teekay.com
