Teekay Corporation Reports Third Quarter Results
HAMILTON, BERMUDA, Nov 8, 2012 (Menafn - Marketwire via COMTEX) --Teekay Corporation TK -
Highlights
--Third quarter 2012 total cash flow from vessel operations of 191.6
million, up 11 percent from the same period of the prior year.
--Third quarter 2012 adjusted net loss attributable to stockholders of
Teekay of 20.0 million, or 0.29 per share (excluding specific items
which increased GAAP net loss by 0.3 million, or 0.00 per share).
--Agreed to sell the Voyageur Spirit FPSO to Teekay Offshore for 540
million; transaction expected to be completed in December 2012.
--Cidade de Itajai FPSO sea trials underway; expected to leave shipyard
for Brazil in mid-November 2012.
--Total consolidated liquidity of approximately 2.0 billion as at
September 30, 2012, pro forma for Teekay Corporation's October 2012 US
123 million Norwegian bond offering.
Teekay Corporation (Teekay or the Company) TK today reported an adjusted net loss attributable to stockholders of Teekay(1) of 20.0 million, or 0.29 per share, for the quarter ended September 30, 2012, compared to an adjusted net loss attributable to stockholders of Teekay of 40.6 million, or 0.58 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 0.3 million, or 0.00 per share, for the three months ended September 30, 2012 and increasing GAAP net loss by 250.6 million, or 3.62 per share, for the three months ended September 30, 2011, 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 20.3 million, or 0.29 per share, for the quarter ended September 30, 2012, compared to net loss attributable to stockholders of Teekay of 291.2 million, or 4.20 per share, for the same period of the prior year. Net revenues(2) for the third quarter of 2012 were 433.9 million, compared to 428.5 million for the same period of the prior year.
For the nine months ended September 30, 2012, the Company reported an adjusted net loss attributable to stockholders of Teekay(1) of 57.8 million, or 0.84 per share, compared to an adjusted net loss attributable to stockholders of Teekay of 104.7 million, or 1.48 per share, for the nine months ended September 30, 2011. 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 8.7 million, or 0.12 per share, for the nine months ended September 30, 2012 and increasing GAAP net loss by 312.6 million, or 4.42 per share, for the nine months ended September 30, 2011, as detailed in Appendix A to this release. Including these items, the Company reported on a GAAP basis, a net loss attributable to stockholders of Teekay of 66.5 million, or 0.96 per share, for the nine months ended September 30, 2012, compared to a net loss attributable to stockholders of Teekay of 417.3 million, or 5.90 per share, for the nine months ended September 30, 2011. Net revenues(2) for the nine months ended September 30, 2012 were 1,333.5 million, compared to 1,304.4 million for the same period of the prior year.
On October 5, 2012, the Company declared a cash dividend on its common stock of 0.31625 per share for the quarter ended September 30, 2012. The cash dividend was paid on October 26, 2012, to all shareholders of record on October 17, 2012.
1.Adjusted net (loss) income 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 income that are typically excluded by
securities analysts in their published estimates of the Company's
financial results.
2.Net revenues represents revenues less voyage expenses, which comprise
all expenses relating to certain voyages, including bunker fuel
expenses, port fees, cargo loading and unloading expenses, canal tolls,
agency fees and commissions. Net revenues is a non-GAAP financial
measure used by certain investors to measure the financial performance
of shipping companies. Please see the Company's website at
www.teekay.com for a reconciliation of this non-GAAP measure as used in
this release to the most directly comparable financial measure under
GAAP.
"During the third quarter, we continued to make progress on executing on our multiple projects, most notably the completion of upgrades to the Voyageur Spirit FPSO," commented Peter Evensen, Teekay Corporation's Chief Executive Officer. "The Voyageur Spirit arrived at the Huntington Field in early October, and the sale of this FPSO unit to Teekay Offshore is expected to be completed shortly after production start-up which is expected to occur in mid-December 2012. Factoring the approximately 130 million of capital upgrade payments funded by Teekay, the assumption of Sevan's 230 million debt facility secured by the Voyageur Spirit and payments to Sevan bondholders, Teekay Offshore's 540 million purchase price will be approximately 90 million above Teekay Parent's acquisition cost."
Mr. Evensen continued, "The Cidade de Itajai FPSO conversion project experienced a two-month delay to its delivery from the shipyard which has no material financial impact to Teekay. The FPSO unit is expected to leave the shipyard in mid-November destined for offshore Brazil where it will begin preparations for its nine-year contract with Petrobras during the first quarter of 2013. In October, the Petrojarl Knarr FPSO hull was completed and launched and installation of the topside processing equipment and turret is underway. The Petrojarl Knarr FPSO is expected to achieve first oil on its North Sea field in the first half of 2014. Construction on Teekay Offshore's newbuilding shuttle tankers is also proceeding on schedule with steel cutting initiated on three of the four vessels, which are expected to deliver in mid- to late-2013. Finally, repairs on the Petrojarl Banff FPSO are underway, with all long lead-time items ordered and the unit on track for re-installation on the field in the fourth quarter of 2013."
"Operationally, we have made progress on our cost-savings initiatives including, the contractual redelivery of in-chartered conventional tankers and the establishment of our new ship management subsidiary, Teekay Marine Ltd.," Mr. Evensen continued. "All employees and systems have now been transferred into our subsidiary, Teekay Marine Ltd. and the transfer of technical management for Teekay's conventional tanker fleet to Teekay Marine was completed in September. Also in September, we commenced a reorganization of our onshore shuttle tanker operations, which is expected to provide additional cost savings upon completion in mid-2013."
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) TOO, Teekay LNG Partners L.P. (Teekay LNG) TGP, Teekay Tankers Ltd. (Teekay Tankers) 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 September 30, 2012
(unaudited)
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TeekayTeekay
OffshoreLNGTeekayConsolida-Teekay
(in thousands of Partners PartnersTankersTeekaytionCorporation
U.S. dollars)LPLPLtd.Parent Adjustments Consolidated
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Net revenues203,73197,86343,912 126,354(37,997)433,863
Vessel operating
expense70,76721,99223,52966,293-182,581
Time-charter
hire expense14,910-80449,014(37,342)27,386
Depreciation and
amortization47,76824,57017,89622,522-112,756
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CFVO -
Consolidated(1)
(2)(3)95,52871,17816,252 (29,170)-153,788
CFVO - Equity
Investments(4)-40,550-(2,750)-37,800
CFVO - Total95,528111,72816,252 (31,920)-191,588
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Three Months Ended September 30, 2011
(unaudited)
------------------------------------------------------------
TeekayTeekay
OffshoreLNGTeekayConsolida-Teekay
(in thousands of Partners PartnersTankersTeekaytionCorporation
U.S. dollars)LPLPLtd.Parent Adjustments Consolidated
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Net revenues208,80496,94928,966 152,625(58,833)428,511
Vessel operating
expense71,64122,36610,90867,457-172,372
Time-charter
hire expense18,620-1,61086,036(58,833)47,433
Depreciation and
amortization46,90523,03210,79727,012-107,746
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CFVO -
Consolidated(1)
(2)(3)105,22770,40214,521 (32,736)-157,414
CFVO - Equity
Investments(4)-15,202-348-15,550
CFVO - Total105,22785,60414,521 (32,388)-172,964
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1.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 B and Appendix C of this release and see the
Company's website at www.teekay.com for a reconciliation of this non-
GAAP measure as used in this release to the most directly comparable
GAAP financial measure.
2.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.
3.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 September 30, 2012 and 2011,
Teekay Parent received daughter company dividends and distributions
totaling 38.0 million and 34.9 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.
4.CFVO - Equity Investments represents the Company's proportionate share
of CFVO from its equity-accounted vessels and other investments. Please
refer to Appendix B of this release and see the Company's website at
www.teekay.com 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 39 shuttle tankers (including four chartered-in vessels and four newbuildings under construction), three floating, production, storage and offloading (FPSO) units, five floating storage and offtake (FSO) units and nine conventional oil tankers, in which its interests range from 50 to 100 percent. Teekay Offshore also has the right to participate in certain other FPSO and vessel opportunities. Teekay Parent currently owns a 29.4 percent interest in Teekay Offshore (including the 2 percent sole general partner interest).
For the third quarter of 2012, Teekay Offshore's quarterly distribution was 0.5125 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 totals 14.6 million for the third quarter of 2012, as detailed in Appendix D to this release.
Cash flow from vessel operations from Teekay Offshore decreased to 95.5 million in the third quarter of 2012, from 105.2 million in the same period of the prior year. This decrease was primarily due to the sale of two conventional tankers and the lay-up of two conventional tankers during the past four quarters following expiry of their time-charter contracts, and the dry-docking of the Navion Saga FSO during a portion of the third quarter of 2012. This was partially offset by a full quarter contribution from the Scott Spirit shuttle tanker newbuilding that delivered in the fourth quarter of 2011, the acquisition of the Piranema Spirit FPSO unit on November 30, 2011, decreases in time-charter hire expense due to the redelivery of one in-chartered vessel in the fourth quarter of 2011, and lower vessel operating costs due to lower repairs, maintenance and crewing costs and the lay-up of the Navion Torinita shuttle tanker commencing in the second quarter of 2012 upon expiration of its charter.
In September 2012, Teekay Offshore completed a public equity offering of 7.8 million common units (including 0.4 million units issued upon exercise of the underwriters' overallotment option), raising net proceeds of 211.5 million (including the general partners' contribution). Net proceeds will be used to partially finance the 540 million acquisition by Teekay Offshore from Teekay of the Voyageur Spirit FPSO, which is expected to occur in mid-December following start-up on the Huntington Field in the North Sea. The 2009-built Voyageur Spirit will operate under a five-year time-charter contract with E.ON which includes certain extension options.
In July 2012, Teekay Offshore sold 1.7 million common units in a private placement for net proceeds of 45.9 million (including the general partners' contribution), which will be used to partially finance the shipyard installments relating to four newbuilding shuttle tankers being constructed by Samsung Heavy Industries, for a total delivered cost of approximately 470 million. Upon their scheduled deliveries in mid- to late-2013, the vessels will commence operations under 10-year time-charter contracts, which include certain contract extension and vessel purchase options, with a subsidiary of BG Group plc to provide shuttle tanker services in Brazil.
In July 2012, Teekay Offshore sold a 1992-built shuttle tanker, the Navion Fennia, to a third party buyer for net proceeds of 7.0 million.
Teekay LNG Partners L.P.
Teekay LNG provides liquefied natural gas (LNG), liquefied petroleum gas (LPG) and crude oil marine transportation services under long-term, fixed-rate charter contracts with major energy and utility companies through its current fleet of 27 LNG carriers, five LPG carriers and 11 conventional tankers, in which Teekay LNG's interests range from 33 to 100 percent. Teekay Parent currently owns a 37.5 percent interest in Teekay LNG (including the 2 percent sole general partner interest).
For the third quarter of 2012, Teekay LNG's quarterly distribution was 0.675 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 totals 23.0 million for the third quarter of 2012, as detailed in Appendix D to this release.
Including cash flows from equity-accounted vessels, Teekay LNG's total cash flow from vessel operations increased to 111.7 million in the third quarter of 2012, from 85.6 million in the same period of the prior year. This increase was primarily due to the acquisition of a 52 percent interest in six LNG carriers from A.P. Moller-Maersk in February 2012 (the MALT LNG Carriers), the acquisition of a 33 percent interest in the four Angola LNG carriers from Teekay between August 2011 and January 2012, and the acquisition of newbuilding Multigas/LPG carriers in September and October of 2011.
In September 2012, Teekay LNG completed a public equity offering of 4.8 million common units (including 0.2 million units issued upon exercise of the underwriters' overallotment option), raising net proceeds of 182.2 million (including the general partners' contribution). Net proceeds have been used for general corporate purposes and to reduce amounts outstanding under Teekay LNG's revolving credit facilities, which may be withdrawn to finance future newbuilding deliveries or vessel acquisitions.
Teekay Tankers Ltd.
Teekay Tankers currently owns a fleet of 29 vessels, including 12 Aframax tankers, 10 Suezmax tankers, three Long Range 2 (LR2) product tankers, three MR product tankers, and a 50 percent interest in a Very Large Crude Carrier (VLCC) newbuilding scheduled to deliver in April 2013. In addition, Teekay Tankers currently time-charters in one Aframax tanker and has invested 115 million in first-priority mortgage loans secured by two 2010-built VLCCs, which loans yield an annualized fixed-rate return of 10 percent. Of the 29 vessels currently in operation, 15 are employed on fixed-rate time-charters, generally ranging from one to three years in initial duration, with the remaining vessels trading in Teekay's spot tanker pools. Based on its current ownership of Class A common stock and its ownership of 100 percent of the outstanding Teekay Tankers Class B stock, Teekay Parent currently owns a 25.1 percent economic interest in and has voting control of Teekay Tankers.
On November 7, 2012, Teekay Tankers declared a third quarter 2012 dividend of 0.02 per share which will be paid November 26, 2012 to all shareholders of record on November 19, 2012. Based on its ownership of Teekay Tankers Class A and Class B shares, the dividend to be paid to Teekay Parent will total 0.4 million for the third quarter of 2012.
In the third quarter of 2012, cash flow from vessel operations from Teekay Tankers increased to 16.3 million from 14.5 million in the same period of the prior year, primarily due to the contribution from 13 vessels acquired from Teekay Corporation in June 2012, partially offset by the expiration of certain time-charter contracts, and subsequent renegotiation at lower tanker rates, over the course of the past year.
Teekay Parent
In addition to its equity ownership interests in Teekay Offshore, Teekay LNG and Teekay Tankers, Teekay Parent directly owns several vessels, which, as at November 1, 2012, included four conventional Suezmax tankers and four FPSO units. In addition, Teekay Parent currently has one newbuilding FPSO unit under construction, owns a 50 percent interest in an FPSO unit currently under conversion, and has agreed to acquire one FPSO unit later in 2012 and resell this unit to Teekay Offshore following commencement of its time-charter contract. As at November 1, 2012, Teekay Parent also had 14 chartered-in conventional tankers (including seven vessels owned by its subsidiaries), two chartered-in LNG carriers owned by Teekay LNG, and two chartered-in shuttle tankers and two chartered-in FSOs owned by Teekay Offshore.
For the third quarter of 2012, Teekay Parent generated negative cash flow from vessel operations of 31.9 million, compared to negative cash flow from vessel operations of 32.4 million in the same period of the prior year. The relative increase in cash flow is due to lower time-charter hire expense as a result of the redelivery of time-chartered in vessels during the past year and the acquisition of the Hummingbird Spirit FPSO in November 2011, partially offset by the sale of the 13 conventional tankers to Teekay Tankers in June 2012, the Petrojarl Banff FPSO being off-hire since its December 2011 storm-related incident and a planned maintenance shut-down on the Foinaven FPSO during the third quarter of 2012.
In the third quarter of 2012, Teekay Parent sold its 40 percent interest in the Ikdam FPSO to a third party resulting in a gain of 10.8 million.
In early October 2012, Teekay Parent issued in the Norwegian bond market NOK 700 million in senior unsecured bonds that mature in October 2015. The aggregate principal amount of the bonds is equivalent to approximately USD 123 million and all interest and principal payments were swapped into USD at a fixed rate of 5.5 percent. The proceeds from the bond issuance have been used to reduce amounts outstanding under Teekay Parent's revolving credit facilities and for general corporate purposes. Teekay Parent is applying to list the bonds on the Oslo Stock Exchange.
In late October 2012, Teekay Parent received notification from Statoil ASA that commercial services of the Petrojarl I FPSO will no longer be required on the Glitne field in the North Sea beyond April 2013. The Petrojarl I has been servicing Statoil at the Glitne field since August 2001. Teekay Parent is currently reviewing redeployment opportunities for the Petrojarl I upon completion of the charter with Statoil.
Fleet List
The following table summarizes Teekay's consolidated fleet of 147 vessels as at November 1, 2012, including chartered-in vessels and vessels under construction/conversion but excluding vessels managed for third parties:
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Number of Vessels(1)
--------------------------------------------------
OwnedChartered-in Newbuildings /
VesselsVesselsConversionsTotal
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Teekay Parent Fleet(2)(3)
Aframax Tankers(4)-6-6
Suezmax Tankers(4)4--4
MR Product Tankers-1-1
FPSO Units(5)4-37
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Total Teekay Parent
Fleet87318
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Teekay Offshore Fleet484456
Teekay LNG Fleet43-43
Teekay Tankers Fleet281130
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Total Teekay Consolidated
Fleet127128147
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1.Ownership interests in these vessels range from 33 percent to 100
percent. Excludes vessels managed on behalf of third parties.
2.Excludes two LNG carriers chartered-in from Teekay LNG.
3.Excludes two shuttle tankers and two FSOs chartered-in from Teekay
Offshore.
4.Excludes five Aframax tankers chartered-in from Teekay Offshore and two
Suezmax tankers chartered-in from Teekay Tankers.
5.Includes one FPSO unit, the Voyageur Spirit, that for accounting
purposes is a variable interest entity (VIE) whereby Teekay is the
primary beneficiary. As a result, the Company has consolidated the VIE
even though the Company does not expect to acquire the FPSO unit until
December 2012.
Liquidity and Capital Expenditures
As at September 30, 2012, Teekay had consolidated liquidity of 1.9 billion (consisting of 586.9 million cash and cash equivalents and 1,322.0 million of undrawn revolving credit facilities), of which 397.9 million of liquidity (consisting of 262.9 million cash and cash equivalents and 135.0 million of undrawn revolving credit facilities) is attributable to Teekay Parent. Giving pro forma effect for the NOK 700 million (approximately USD 123 million equivalent) of proceeds from Teekay Parent's senior unsecured Norwegian bond issuance completed in early October 2012, Teekay had total consolidated liquidity of approximately 2.0 billion as at September 30, 2012, of which 520.9 million was attributable to Teekay Parent.
The following table provides the Company's remaining capital commitments relating to its portion of acquisitions, newbuildings and conversions and related total financing completed as at September 30, 2012:
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Amount
Financed
(in millions)201220132014Totalto Date
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Teekay Offshore(1)45323-368-
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Teekay LNG-----
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Teekay Tankers(2)1027-3734
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Teekay Parent(3)28456343683237(4)
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Total Teekay Corporation
Consolidated3394063431,088271(4)
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1.Includes capital expenditures related to four newbuilding shuttle
tankers.
2.Includes remaining capital expenditures related to Teekay Tankers' 50
percent interest in the Wah Kwong VLCC Newbuilding.
3.Includes remaining capital expenditures related to the Knarr FPSO
newbuilding, the upgrade and acquisition by Teekay from Sevan of the
Voyageur Spirit FPSO unit (net of the existing 230 million debt
facility which Teekay Parent will assume as part of the acquisition and
is currently accounted for on Teekay Parent's Balance Sheet as the
Voyageur Spirit is deemed a variable interest entity) and Teekay
Parent's 50 percent interest in the Cidade de Itajai FPSO unit.
4.Includes a firm commitment to upsize the Voyageur Spirit FPSO debt
facility by 100 million syndicated by a bank group in November 2012.
As indicated above, the Company had total capital expenditure commitments pertaining to its portion of acquisitions, newbuildings and conversions of approximately 1.1 billion remaining as at September 30, 2012. The Company's current pre-arranged financing of approximately 271 million mostly relates to its remaining 2012 capital expenditure commitments. The Company is in the process of obtaining additional debt financing to fund its remaining capital expenditure commitments relating to the four shuttle tanker newbuildings, which are scheduled to deliver in mid- to late-2013 and the Knarr FPSO newbuilding, which is scheduled to deliver in the first half of 2014.
Conference Call
The Company plans to host a conference call on November 8, 2012 at 11:00 a.m. (ET) to discuss its results for the third quarter of 2012. 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) 820-0231 or (416) 640-5926, if outside North America,
and quoting conference ID code 7306074.
--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, November 15, 2012. 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 7306074.
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. TGP and Teekay Offshore Partners L.P. TOO, its controlling ownership of Teekay Tankers Ltd. TNK, and its fleet of directly-owned vessels, Teekay is responsible for managing and operating consolidated assets of over 11 billion, comprised of approximately 150 liquefied gas, offshore, and conventional tanker assets. With offices in 16 countries and approximately 6,400 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
(in thousands of U.S. dollars, except share and per share data)
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Three Months EndedNine Months Ended
------------------------------------------------------------
SeptemberSeptemberSeptemberSeptember
30,June 30,30,30,30,
------------------------------------------------------------
20122012201120122011
------------------------------------------------------------
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
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REVENUES(1)463,537481,911468,1061,441,0121,441,052
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OPERATING
EXPENSES
Voyage
expenses(1)29,67439,17639,595107,487136,610
Vessel
operating
expenses(1)(2)182,581172,356172,372522,138508,666
Time-charter
hire expense27,38631,49147,433102,856163,877
Depreciation
and
amortization112,756115,068107,746342,438318,018
General and
administrative
(1)(2)49,63050,77748,801153,780170,292
Loss on sale of
vessels and
equipment /
asset
impairments9,1933,26991,80912,265101,214
Goodwill
impairment--36,652-36,652
Restructuring
charges3,9191,525695,4445,490
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415,139413,662544,4771,246,4081,440,819
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Income (loss)
from vessel
operations48,39868,249(76,371)194,604233
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OTHER ITEMS
Interest
expense(1)(41,652)(42,707)(33,649)(126,659)(99,959)
Interest
income(1)6741,6452,3944,3657,316
Realized and
unrealized
loss on
derivative
instruments(1)(35,149)(94,598)(219,570)(124,932)(298,453)
Equity income
(loss)(3)30,1795,291(40,624)53,114(40,282)
Income tax
(expense)
recovery(4,039)1,849(1,487)1,378(4,321)
Foreign
exchange
(loss) gain(8,504)17,83526,230(6,493)(1,267)
Other (loss)
income - net(376)897662,0561,820
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Net loss(10,469)(42,347)(342,311)(2,567)(434,913)
Less: Net
(income) loss
attributable
to non-
controlling
interests(9,792)(4,927)51,149(63,902)17,645
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Net loss
attributable
to
stockholders
of Teekay
Corporation(20,261)(47,274)(291,162)(66,469)(417,268)
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Loss per common
share of
Teekay
- Basic(0.29)(0.68)(4.20)(0.96)(5.90)
- Diluted(0.29)(0.68)(4.20)(0.96)(5.90)
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Weighted-
average number
of common
shares
outstanding
- Basic69,372,22069,231,41969,375,03669,153,96670,743,085
- Diluted69,372,22069,231,41969,375,03669,153,96670,743,085
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1.Realized and unrealized gains and losses related to derivative
instruments that are not designated as hedges for accounting purposes
are included as a separate line item in the statements of loss. The
realized gains (losses) relate to the amounts the Company actually
received or paid to settle such derivative instruments and the
unrealized gains (losses) relate to the change in fair value of such
derivative instruments, as detailed in the table below:
Three Months EndedNine Months Ended
--------------------------------------------------
SeptemberSeptember September September
30,June 30,30,30,30,
--------------------------------------------------
20122012201120122011
--------------------------------------------------
Realized (losses) gains
relating to:
Interest rate swaps(30,027)(29,669)(32,447)(90,112)(99,136)
Interest rate swap
resets and terminations--(34,426)-(127,098)
Foreign currency forward
contracts
Vessel operating
expenses(876)2434,0656048,618
General and
administrative
expenses-(96)147(96)477
Bunkers, freight forward
agreements (FFAs) and
other--(6)11,45236
--------------------------------------------------
(30,903)(29,522)(62,667)(78,152) (217,103)
--------------------------------------------------
Unrealized (losses) gains
relating to:
Interest rate swaps(8,036)(58,425) (142,697)(49,326)(74,170)
Foreign currency forward
contracts3,790(6,651)(14,324)5,931(7,076)
Bunkers, FFAs and other--118(3,385)(104)
--------------------------------------------------
(4,246)(65,076) (156,903)(46,780)(81,350)
--------------------------------------------------
Total realized and
unrealized (losses) gains
on non-designated
derivative instruments(35,149)(94,598) (219,570) (124,932) (298,453)
--------------------------------------------------
--------------------------------------------------
2.The Company has entered into foreign currency forward contracts, which
are economic hedges of vessel operating expenses and general and
administrative expenses. Certain of these forward contracts have been
designated as cash flow hedges pursuant to GAAP. Unrealized gains
(losses) arising from hedge ineffectiveness from such forward contracts
are reflected in vessel operating expenses and general and
administrative expenses in the above Summary Consolidated Statements of
Loss, as detailed in the table below:
Three Months EndedNine Months Ended
--------------------------------------------------
SeptemberSeptember September September
30June 30303030
--------------------------------------------------
20122012201120122011
--------------------------------------------------
Vessel operating expenses--(168)-(519)
General and administrative(168)(306)(145)(492)71
3.Equity income excluding the Company's proportionate share of items
identified in Appendix A of this release is detailed in the table below:
Three Months EndedNine Months Ended
--------------------------------------------------
SeptemberSeptember September September
30,June 30,30,30,30,
--------------------------------------------------
20122012201120122011
--------------------------------------------------
Equity income (loss)30,1795,291(40,624)53,114(40,282)
Gain on sale of equity
investment(10,830)--(10,830)-
Proportionate share of
unrealized losses (gains)
on derivative instruments1,89610,42826,2235,40434,435
Impairment of equity
investment--19,411-19,411
Other269557-826-
--------------------------------------------------
Equity income adjusted for
items in Appendix A21,51416,2765,01048,51413,564
--------------------------------------------------
--------------------------------------------------
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
SUMMARY CONSOLIDATED BALANCE SHEETS
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
As at SeptemberAs at December
30, As at June 30,31,
---------------------------------------------
201220122011
---------------------------------------------
(unaudited)(unaudited)(unaudited)
---------------------------------------------
ASSETS
Cash and cash equivalents586,901665,737692,127
Other current assets623,335557,506495,357
Restricted cash - current35,0514,6594,370
Restricted cash - long-term496,309526,705495,784
Vessels held for sale8,00014,96119,000
Vessels and equipment7,152,0487,197,2597,360,454
Advances on newbuilding
contracts/conversions590,114444,173507,908
Derivative assets177,485167,701165,269
Investment in equity accounted
investees453,143436,486252,637
Investment in direct financing
leases442,121447,746459,908
Investment in term loans187,581187,347186,844
Other assets200,141209,774184,438
Intangible assets124,870128,682136,742
Goodwill166,539166,539166,539
----------------------------------------------------------------------------
Total Assets11,243,63811,155,27511,127,377
----------------------------------------------------------------------------
----------------------------------------------------------------------------
LIABILITIES AND EQUITY
Accounts payable and accrued
liabilities509,798382,128487,651
Current portion of long-term
debt826,630798,828448,579
Long-term debt4,806,5955,227,6405,422,344
Long-term debt - variable
interest entity(1)230,394230,450220,497
Derivative liabilities732,536728,944686,879
In process revenue contracts254,615272,733308,640
Other long-term liabilities219,203219,493220,986
Redeemable non-controlling
interest36,24136,35638,307
Equity:
Non-controlling interests2,223,8051,919,4101,863,798
Stockholders of Teekay1,403,8211,339,2931,429,696
----------------------------------------------------------------------------
Total Liabilities and Equity11,243,63811,155,27511,127,377
----------------------------------------------------------------------------
----------------------------------------------------------------------------
1.For accounting purposes, the Voyageur Spirit is a variable interest
entity (VIE), whereby Teekay is the primary beneficiary. As a result,
the Company has consolidated the VIE as of December 1, 2011, even though
the Company does not expect to acquire the Voyageur Spirit FPSO unit
until December 2012.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of U.S. dollars)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Nine Months Ended
--------------------------
September 30
--------------------------
20122011
--------------------------
(unaudited)(unaudited)
--------------------------
Cash and cash equivalents provided by (used for)
OPERATING ACTIVITIES
----------------------------------------------------------------------------
Net operating cash flow262,54548,356
----------------------------------------------------------------------------
FINANCING ACTIVITIES
Net proceeds from long-term debt1,026,9021,225,710
Scheduled repayments of long-term debt(212,877)(184,624)
Prepayments of long-term debt(1,055,135)(430,860)
Increase in restricted cash(31,421)(5,306)
Repurchase of common stock-(118,036)
Net proceeds from public offerings of Teekay LNG178,431107,234
Net proceeds from public offerings of Teekay
Offshore252,05119,877
Net proceeds from public offerings of Teekay
Tankers65,854158,326
Equity contribution from joint venture partner70,750-
Cash dividends paid(61,308)(70,124)
Distribution from subsidiaries to non-controlling
interests(182,647)(152,985)
Other7,8575,492
----------------------------------------------------------------------------
Net financing cash flow58,457554,704
----------------------------------------------------------------------------
INVESTING ACTIVITIES
Expenditures for vessels and equipment(413,970)(561,378)
Proceeds from sale of vessels and equipment226,20133,355
Investment in term loans-(70,404)
Proceeds from sale of marketable securities1,063-
Loan to joint ventures and equity accounted
investees(94,097)(4,092)
Investment in joint ventures(163,482)(25,281)
Direct financing lease payments received and other18,05720,395
----------------------------------------------------------------------------
Net investing cash flow(426,228)(607,405)
----------------------------------------------------------------------------
Decrease in cash and cash equivalents(105,226)(4,345)
Cash and cash equivalents, beginning of the period692,127779,748
----------------------------------------------------------------------------
Cash and cash equivalents, end of the period586,901775,403
----------------------------------------------------------------------------
----------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX A - SPECIFIC ITEMS AFFECTING NET LOSS
(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 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 EndedNine Months Ended
----------------------------------------
September 30, 2012September 30, 2012
----------------------------------------
(unaudited)(unaudited)
Per Per
Share(1)Share(1)
----------------------------------------------------------------------------
Net loss - GAAP basis(10,469)(2,567)
Adjust for: Net income attributable
to
non-controlling interests(9,792)(63,902)
----------------------------------------------------------------------------
Net loss attributable to
stockholders of Teekay(20,261)(0.29)(66,469)(0.96)
Add (subtract) specific items
affecting net loss:
Unrealized losses from derivative
instruments(2)6,3100.1052,6770.76
Foreign exchange loss(3)7,8250.114,0890.06
Loss on sale of assets/asset
impairments(4)9,1930.1312,2650.18
Restructuring charges(5)3,9190.065,4440.08
Gain on sale of equity investment(6)(10,830)(0.16)(10,830)(0.16)
Realized gain upon settlement of
embedded derivative--(11,452)(0.17)
Non-recurring adjustments to tax
accruals--(8,006)(0.12)
Other(7)269-(221)-
Non-controlling interests' share of
items above(16,394)(0.24)(35,300)(0.51)
----------------------------------------------------------------------------
Total adjustments292-8,6660.12
----------------------------------------------------------------------------
Adjusted net loss attributable to
stockholders of Teekay(19,969)(0.29)(57,803)(0.84)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
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 (loss) 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 impairment of one of the Company's older shuttle tankers and
disposal of another of the Company's older shuttle tankers.
5.Restructuring charges relate to the reorganization of the Company's
marine operations.
6.Relates to the sale of the Company's 40 percent interest in FPSO unit.
7.Other includes transaction and acquisition related costs associated with
the sale of 13 conventional tankers from Teekay Parent to Teekay Tankers
in June 2012 and the acquisition by Teekay LNG from a third party of the
MALT LNG carriers in February 2012.
TEEKAY CORPORATION
APPENDIX A - SPECIFIC ITEMS AFFECTING NET LOSS
(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 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 EndedNine Months Ended
----------------------------------------
September 30, 2011September 30, 2011
----------------------------------------
(unaudited)(unaudited)
Per Per
Share(1)Share(1)
----------------------------------------------------------------------------
Net loss - GAAP basis(342,311)(434,913)
Adjust for: Net loss attributable to
non-controlling interests51,14917,645
----------------------------------------------------------------------------
Net loss attributable to
stockholders of Teekay(291,162)(4.20) (417,268)(5.90)
Add (subtract) specific items
affecting net loss:
Unrealized losses from derivative
instruments(2)183,8032.65116,5961.65
Foreign exchange (gain) loss(3)(27,006)(0.39)1,9360.03
Loss on sale of assets/asset
impairments(4)111,2201.60120,6251.70
Goodwill impairment(5)36,6520.5336,6520.52
Upfront payments related to interest
rate swap resets and interest rate
swap termination34,4260.50127,0981.80
Restructuring charges(6)69-5,4900.08
Deferred income tax expense on
unrealized foreign exchange gains--10,0950.14
Adjustments to pension accruals and
stock-based compensation(7)--18,1020.25
Other - net(8)--(6,234)(0.09)
Non-controlling interests' share of
items above(88,570)(1.27) (117,785)(1.66)
----------------------------------------------------------------------------
Total adjustments250,5943.62312,5764.42
----------------------------------------------------------------------------
Adjusted net loss attributable to
stockholders of Teekay(40,568)(0.58) (104,692)(1.48)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
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 (loss) 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 deferred tax liability
denominated in Norwegian Kroner. A substantial majority of the Company's
foreign currency exchange gains and losses are unrealized.
4.Relates to the write-down in the carrying value of certain smaller
product tankers, certain older vessels and an investment in a joint
venture.
5.Relates to impairment of goodwill of the Company's conventional tanker
segment.
6.Restructuring charges relate to crew changes, reflagging of certain
vessels, and global staffing changes.
7.Relates to one-time pension retirement payment to the Company's former
President and Chief Executive Officer and accelerated timing of
accounting recognition of stock-based compensation expense.
8.Relates to non-recurring adjustments to tax accruals.
<table>
-------------------------------------------------------------------------------------------------------------------------------------------------------- TEEKAY CORPORATION APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION SUMMARY BALANCE SHEET AS AT SEPTEMBER 30, 2012 (in thousands of U.S. dollars) -------------------------------------------------------------------------------------------------------------------------------------------------------- (unaudited) Consolida- Teekay Teekay Teekay Teekay tion Offshore LNG Tankers Parent Adjustments Total ----------------------------------------------------------------ASSETS Cash and cash equivalents 205,753 91,931 26,298 262,919 - 586,901Other current assets 134,672 19,327 19,843 449,493 - 623,335Restricted cash (current & non- current) - 527,670 - 3,690 - 531,360Vessels held for sale 8,000 - - - - 8,000Vessels and equipment 2,400,466 1,960,756 1,266,594 1,524,232 - 7,152,048Advances on newbuilding contracts 81,868 - - 508,246 - 590,114Derivative assets 8,957 167,638 - 890 - 177,485Investment in equity accounted investees - 388,722 3,224 68,197 (7,000) 453,143Investment in direct financing leases 37,120 404,981 - 20 - 442,121Investment in term loans - - 117,581 70,000 - 187,581Other assets 29,412 37,668 13,487 119,574 - 200,141Advances to affiliates 6,722 3,338 22,619 (32,679) - -Equity investment in subsidiaries - - - 581,123 (581,123) -Intangibles and goodwill 144,169 143,199 - 4,041 - 291,409 ---------------------------------------------------------------- TOTAL ASSETS 3,057,139 3,745,230 1,469,646 3,559,746 (588,123) 11,243,638 ---------------------------------------------------------------- ---------------------------------------------------------------- LIABILITIES AND EQUITY Accounts payable and accrued liabilities 86,625 46,019 19,023 358,131 - 509,798Advances from affiliates 57,762 11,072 16,154 (84,988) - -Current portion of long-term debt 121,509 253,791 25,246 426,084 - 826,630Long-term debt 1,621,909 1,730,220 706,896 747,570 - 4,806,595Long-term debt - variable interest entity - - - 230,394 - 230,394Derivative liabilities 306,998 328,930 37,365 59,243 - 732,536In-process revenue contracts 117,250 - - 137,365 - 254,615Other long- term liabilities 27,065 105,147 4,578 82,413 - 219,203Redeemable non- controlling interest 36,241 - - - - 36,241Equity: Non- controlling interests (1) 42,711 32,434 - 199,713 1,948,947 2,223,805 Equity attributable to stockholders/ unitholders of publicly- listed entities 639,069 1,237,617 660,384 1,403,821 (2,537,070) 1,403,821 ---------------------------------------------------------------- TOTAL LIABILITIES AND EQUITY 3,057,139 3,745,230 1,469,646 3,559,746 (588,123) 11,243,638 ---------------------------------------------------------------- ---------------------------------------------------------------- NET DEBT(2) 1,537,665 1,364,410 705,844 1,137,439 - 4,745,358 ---------------------------------------------------------------- ----------------------------------------------------------------
1. Non-controlling interests in the Teekay Offshore and Teekay LNG columns represent the 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 INCOME (LOSS) FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2012 (in thousands of U.S. dollars) -------------------------------------------------------------------------------------------------------------------------------------------------------- (unaudited) Consolida- tion Teekay Teekay Teekay Teekay Adjust- Offshore LNG Tankers Parent ments Total --------------------------------------------------------- Revenues 227,956 98,723 46,084 129,140 (38,366) 463,537 --------------------------------------------------------- Voyage expenses 24,225 860 2,172 2,786 (369) 29,674 Vessel operating expenses 70,767 21,992 23,529 66,293 - 182,581 Time-charter hire expense 14,910 - 804 49,014 (37,342) 27,386 Depreciation and amortization 47,768 24,570 17,896 22,522 - 112,756 General and administrative 19,195 6,254 3,327 21,509 (655) 49,630 Loss on sale of vessels and equipment/asset impairments 9,193 - - - - 9,193 Restructuring charges 417 - - 3,502 - 3,919 ---------------------------------------------------------Total operating expenses 186,475 53,676 47,728 165,626 (38,366) 415,139 --------------------------------------------------------- Income (loss) from vessel operations 41,481 45,047 (1,644) (36,486) - 48,398 --------------------------------------------------------- Net interest expense (11,889) (13,564) (2,939) (12,586) - (40,978)Realized and unrealized loss on derivative instruments (13,458) (9,945) (4,252) (7,494) - (35,149)Income tax expense (1,025) (679) - (2,335) - (4,039)Equity income - 21,098 - 9,081 - 30,179 Equity in earnings of subsidiaries(1) - - - 22,580 (22,580) - Foreign exchange loss (715) (6,248) (126) (1,415) - (8,504)Other - net (55) 374 (700) 5 - (376) ---------------------------------------------------------Net income (loss) 14,339 36,083 (9,661) (28,650) (22,580) (10,469)Less: Net (income) loss attributable to non-controlling interests(2) (572) (3,022) - 8,389 (14,587) (9,792) ---------------------------------------------------------Net income (loss) attributable to stockholders/ unitholders of publicly-listed entities 13,767 33,061 (9,661) (20,261) (37,167) (20,261) --------------------------------------------------------- ---------------------------------------------------------CFVO - Consolidated(3)(4) 95,528 71,178 16,252 (29,170) - 153,788 CFVO - Equity Investments(5) - 40,550 - (2,750) - 37,800 CFVO - Total 95,528 111,728 16,252 (31,920) - 191,588 --------------------------------------------------------- ---------------------------------------------------------
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 the 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 the Company's Web site at www.teekay.com 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 three months ended September 30, 2012, Teekay Parent received cash dividends and distributions from these subsidiaries totaling 38.0 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. Cash flow from vessel operations (CFVO) - Equity Investments represents the Company's proportionate share of CFVO from its equity accounted vessels and other investments. Please see the Company's Web site at www.teekay.com 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 NINE MONTHS ENDED SEPTEMBER 30, 2012 (in thousands of U.S. dollars) -------------------------------------------------------------------------------------------------------------------------------------------------------- (unaudited) Consolida- tion Teekay Teekay Teekay Teekay Adjust- Offshore LNG Tankers Parent ments Total ------------------------------------------------------------- Revenues 723,705 294,293 151,936 396,435 (125,357) 1,441,012 ------------------------------------------------------------- Voyage expenses 98,506 1,445 3,601 4,884 (949) 107,487 Vessel operating expenses 211,854 62,627 65,600 182,057 - 522,138 Time-charter hire expense 41,496 - 3,109 183,255 (125,004) 102,856 Depreciation and amortization 147,382 73,876 53,934 67,246 - 342,438 General and administrative 58,020 19,876 11,139 57,183 7,562 153,780 Loss (gain) on sale of vessels and equipment/asset impairments 12,462 - - (197) - 12,265 Restructuring charges 417 - - 5,027 - 5,444 -------------------------------------------------------------Total operating expenses 570,137 157,824 137,383 499,455 (118,391) 1,246,408 ------------------------------------------------------------- Income (loss) from vessel operations 153,568 136,469 14,553 (103,020) (6,966) 194,604 ------------------------------------------------------------- Net interest expense (36,821) (38,215) (17,133) (30,125) - (122,294)Realized and unrealized loss on derivative instruments (57,536) (43,993) (9,226) (14,177) - (124,932)Income tax (expense) recovery (564) (549) - 2,491 - 1,378 Equity income - 49,232 - 3,882 - 53,114 Equity in earnings of subsidiaries(1) - - - 61,372 (61,372) - Foreign exchange loss (2,585) (1,989) (9) (1,910) - (6,493)Other - net 1,251 1,067 (1,797) 1,535 - 2,056 -------------------------------------------------------------Net income (loss) 57,313 102,022 (13,612) (79,952) (68,338) (2,567)Less: Net (income) loss attributable to non- controlling interests(2) (3,040) (6,542) - 13,483 (67,803) (63,902) -------------------------------------------------------------Net income (loss) attributable to stockholders/ unitholders of publicly- listed entities 54,273 95,480 (13,612) (66,469) (136,141) (66,469) ------------------------------------------------------------- -------------------------------------------------------------CFVO - Consolidated (3)(4) 307,424 214,844 48,480 (60,178) (7,000) 503,570 CFVO - Equity Investments(5) - 104,771 - (4,816) - 99,955 CFVO - Total 307,424 319,615 48,480 (64,994)(4) (7,000) 603,525 ------------------------------------------------------------- -------------------------------------------------------------
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 the 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 the Company's website at www.teekay.com 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 nine months ended September 30, 2012, Teekay Parent received cash dividends and distributions from these subsidiaries totaling 116.5 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. Cash flow from vessel operations (CFVO) - Equity investments represents the Company's proportionate share of CFVO from its equity accounted vessels and other investments. Please see the Company's Web site at www.teekay.com for a reconciliation of this non-GAAP measure as used in this release to the most directly comparable GAAP measure.
</table>
TEEKAY CORPORATION
APPENDIX C - SUPPLEMENTAL FINANCIAL INFORMATION
TEEKAY PARENT SUMMARY OPERATING RESULTS
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2012
(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 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.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
In-
Charter-
Owneded
Convent- ConventiTeekay
ionalonalParent
TankersTankersFPSOs Other(1)Total
---------------------------------------------
Revenues4,89230,72178,10515,422129,140
Voyage expenses1202,475-1912,786
Vessel operating expenses2,2005,93757,50864866,293
Time-charter hire expense-32,6315,30411,07949,014
Depreciation and amortization2,570-19,13282022,522
General and administrative1,1221,4919,9368,96021,509
Restructuring charges---3,5023,502
---------------------------------------------
Total operating expenses6,01242,53491,88025,200165,626
---------------------------------------------
Loss from vessel operations(1,120) (11,813) (13,775)(9,778) (36,486)
---------------------------------------------
Reconciliation of income (loss) from vessel operations to cash flow from
vessel operations
Loss from vessel operations(1,120) (11,813) (13,775)(9,778) (36,486)
Depreciation and amortization2,570-19,13282022,522
Amortization of in process
revenue contracts and other--(14,208)-(14,208)
Unrealized losses from the
change in fair value of
designated foreign exchange
forward contracts26-82-108
Realized losses from the
settlements of non-designated
foreign exchange forward
contracts(1,095)-(11)-(1,106)
---------------------------------------------
CASH FLOW FROM VESSEL
OPERATIONS(2)381(11,813)(8,780)(8,958) (29,170)
---------------------------------------------
---------------------------------------------
1.Results of two chartered-in LNG carriers owned by Teekay LNG and one
chartered-in FSO unit owned by Teekay Offshore and interest income
received from an investment in term loan.
2.Excludes CFVO from the Company's proportionate share of CFVO generated
by its equity-accounted vessels and other investments.
TEEKAY CORPORATION
APPENDIX C - SUPPLEMENTAL FINANCIAL INFORMATION
TEEKAY PARENT SUMMARY OPERATING RESULTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2012
(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 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.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
In-
Chartered
OwnedConvent-
Convent-ionalTeekay
ionalTankersParent
Tankers(1)FPSOsOther(2)Total
--------------------------------------------------
Revenues20,802101,484229,01545,134396,435
Voyage expenses6384,399-(153)4,884
Vessel operating expenses7,00614,802157,9512,298182,057
Time-charter hire expense-134,38315,91732,955183,255
Depreciation and
amortization8,640-57,78682067,246
General and administrative2,5785,47128,86420,27057,183
Net gain on vessel sales(197)---(197)
Restructuring charges---5,0275,027
--------------------------------------------------
Total operating expenses18,665159,055260,51861,217499,455
--------------------------------------------------
--------------------------------------------------
Income (loss) from vessel
operations2,137(57,571)(31,503)(16,083) (103,020)
--------------------------------------------------
Reconciliation of (loss) income from vessel operations to cash flow from
vessel operations
Income (loss) from vessel
operations2,137(57,571)(31,503)(16,083) (103,020)
Depreciation and
amortization8,640-57,78682067,246
Net gain on vessel sales(197)---(197)
Amortization of in process
revenue contracts and
other(138)(114)(42,990)-(43,242)
Unrealized losses from the
change in fair value of
designated foreign
exchange forward
contracts(61)-259-198
Realized (losses) gains
from the settlements of
non-designated foreign
exchange forward
contracts/bunkers/FFAs(1,469)-150-(1,319)
Dropdown predecessor cash
flow(3)20,155---20,155
--------------------------------------------------
CASH FLOW FROM VESSEL
OPERATIONS(4)29,068(57,685)(16,298)(15,263)(60,179)
--------------------------------------------------
--------------------------------------------------
1.Time-charter hire expense includes a one-time 14.7 million charter
termination fee paid to Teekay Offshore.
2.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 and a one-time 7.0
million success fee payment received from Teekay LNG upon the
acquisition of six LNG carriers in February 2012.
3.Includes cash flow from vessel operations (CFVO) relating to assets
owned by Teekay Parent prior to their acquisition by Teekay Tankers as
these results are included in the historical results for Teekay Parent.
4.Excludes CFVO from the Company's proportionate share of CFVO generated
by its equity-accounted vessels and other investments.
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 September 30, 2012, June 30, 2012, March 31, 2012, December 31, 2011, and September 30, 2011. 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 September 30, 2012 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 June 30, 2012, March 31, 2012, December 31, 2011, and September 30, 2011, please see the Company's website at www.teekay.com. 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
--------------------------------------------------
SeptemberDecember September
30,June 30, March 31,31,30,
--------------------------------------------------
20122012201220112011
--------------------------------------------------
Teekay Parent cash flow
from vessel operations(1)
Owned Conventional Tankers38113,33915,34718,09013,690
In-Chartered
Conventional Tankers(2)(11,813)(28,138)(17,734)(34,957)(30,966)
FPSOs(8,780)(3,205)(4,313)35,044(5,501)
Other(8,958)(6,441)136(13,073)(9,959)
--------------------------------------------------
Total(29,170)(24,445)(6,564)5,104(32,736)
Daughter company
distributions to Teekay
Parent(3)
Common shares/units(4)
Teekay LNG Partners17,01617,01617,01615,88115,881
Teekay Offshore Partners11,46111,46111,46111,18111,181
Teekay Tankers Ltd.(5)4202,3072,5781,7722,417
--------------------------------------------------
Total28,89730,78431,05528,83429,479
General partner interest
Teekay LNG Partners5,9355,5245,5243,4703,176
Teekay Offshore Partners3,1552,8492,7822,4882,237
--------------------------------------------------
Total9,0908,3738,3065,9585,413
Total Teekay Parent cash
flow before interest and
dry dock expenditures8,81714,71232,79739,8962,156
Less:
Net interest expense (6)(16,284)(19,269)(19,504)(17,280)(16,920)
Dry dock expenditures-(129)(124)(3,659)(1,811)
--------------------------------------------------
TOTAL TEEKAY PARENT FREE
CASH FLOW(7,467)(4,686)13,16918,957(16,575)
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1.Cash flow from vessel operations 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 on 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. Cash flow from vessel
operations is a non-GAAP financial measure used by certain investors to
measure the financial performance of shipping companies. For further
details for the quarter ended September 30, 2012, 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 quarters ended
June 30, 2012, March 31, 2012, December 31, 2011, and September 30,
2011, please refer to the Company's website at www.teekay.com.
2.Includes a one-time charter termination fee of 14.7 million paid to
Teekay Offshore during the three months ended June 30, 2012.
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 company and period as follows:
Three Months Ended
----------------------------------------------------------
SeptemberSeptember
30,June 30,March 31,December 31,30,
----------------------------------------------------------
20122012201220112011
----------------------------------------------------------
Teekay LNG
Partners
Distribution
per common
unit0.675 0.675 0.675 0.630 0.630
Common units
owned by
Teekay Parent25,208,27425,208,27425,208,27425,208,27425,208,274
------------------------------------------------------------
Total
distribution17,015,585 17,015,585 17,015,585 15,881,213 15,881,213
Teekay Offshore
Partners
Distribution
per common
unit0.5125 0.5125 0.5125 0.500 0.500
Common units
owned by
Teekay Parent22,362,81422,362,81422,362,81422,362,81422,362,814
------------------------------------------------------------
Total
distribution11,460,942 11,460,942 11,460,942 11,181,407 11,181,407
Teekay Tankers
Ltd.
Dividend per
share0.02 0.11 0.16 0.11 0.15
Shares owned
by Teekay
Parent(5)20,976,53020,976,53016,112,24416,112,24416,112,244
------------------------------------------------------------
Total dividend 419,531 2,307,418 2,577,959 1,772,347 2,416,837
5.Includes Class A and Class B shareholdings.
6.Net interest expense includes realized gains and losses on interest rate
swaps. For the three months ended June 30, 2012, net interest expense
includes 6.3 million related to 13 conventional tankers prior to their
sale to Teekay Tankers in June 2012. For the three months ended
September 30, 2011, net interest expense excludes a realized loss of
34.4 million related to early termination of an interest rate swap
agreement.
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: the estimated cost and timing of delivery of FPSO and shuttle tanker newbuildings or conversions and the effect on the Company's future operating results; the timing and certainty of the completion of repairs and field re-installation for the Petrojarl Banff FPSO; the estimated timing of commencement of new charter contracts upon delivery of FPSO and shuttle tanker newbuildings or conversions; the sale of the Voyageur Spirit FPSO from Sevan Marine to Teekay Parent and then to Teekay Offshore, including Teekay Parent's estimated acquisition cost of the Voyageur Spirit from Sevan Marine, and the difference between Teekay Offshore's purchase price and Teekay Parent's acquisition cost from Sevan Marine; the timing and certainty of completing the Company's new 330 million debt facility for the Voyageur Spirit; expected timing of redeliveries of vessels chartered-in by Teekay Parent; the potential redeployment of the Petrojarl I FPSO, including timing and certainty of commencing a new charter; timing and amount of cost savings related to the Company's new ship management company, Teekay Marine Ltd., and the Company's cost-savings initiatives, including reorganization of the Company's shuttle tanker operations; and the Company's future capital expenditure commitments and the debt financings that the Company expects to obtain for its remaining unfinanced capital expenditure commitments.
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, FSOs and FPSOs; 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; changes affecting the offshore tanker market; shipyard production or vessel conversion delays and cost overruns; delays in commencement of operations of FPSO units at designated fields; changes in the Company's expenses; the Company's future capital expenditure requirements and the inability to secure financing for such requirements; the inability of the Company to complete vessel sale transactions to its public company subsidiaries or to third parties; factors impeding or preventing the Company from realizing expected savings from the reorganization of its conventional tanker and shuttle tanker operations; 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, 2011. 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.
FOR FURTHER INFORMATION PLEASE CONTACT: Teekay Corporation Kent Alekson 1 (604) 844-6654 www.teekay.com
SOURCE: Teekay Corporation
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