Teekay Offshore Partners Reports Second Quarter Results
(Thomson Reuters ONE) -
HAMILTON, BERMUDA--(Marketwired - Aug. 8, 2013) - Highlights
* Generated distributable cash flow((1)) of $43.0 million in the second
quarter of 2013.
* Completed acquisition of Voyageur Spirit FPSO unit from Teekay Corporation
for $540 million.
* Completed acquisition of a 50 percent interest in Cidade de Itajai FPSO unit
from Teekay Corporation for $204 million.
* First two BG Shuttle Tanker newbuildings delivered in May and June 2013.
* Awarded contract with Statoil to convert an existing shuttle tanker to an
FSO unit.
* Liquidity of approximately $487 million as at June 30, 2013, pro forma for
debt refinancing of Varg FPSO completed in July 2013.
Teekay Offshore GP LLC, the general partner of Teekay Offshore Partners L.P.
(Teekay Offshore or the Partnership) (NYSE:TOO), today reported the
Partnership's results for the quarter ended June 30, 2013. During the second
quarter of 2013, the Partnership generated distributable cash flow((1) )of $43.0
million, compared to $54.2 million in the same period of the prior year.
On July 12, 2013, a cash distribution of $0.5253 per common unit was declared
for the quarter ended June 30, 2013. The cash distribution is payable on August
9, 2013 to all unitholders of record on July 23, 2013.
"During the second and third quarters of 2013 to-date, the Partnership completed
a number of acquisitions, vessel deliveries and new contracts which the
Partnership expects will all contribute to Teekay Offshore's future
distributable cash flow growth," commented Peter Evensen, Teekay Offshore GP
LLC's Chief Executive Officer. "In May and June 2013, respectively, we completed
the accretive acquisitions of the Voyageur Spirit FPSO and a 50 percent interest
in the Cidade de Itajai FPSO, bringing the Partnership's total FPSO fleet count
to five units. Although issues were encountered in achieving full production on
the Voyageur Spirit related to gas compression equipment, our sponsor, Teekay
Corporation, will indemnify the Partnership for loss of revenues resulting from
the delay in achieving final acceptance by the charterer. This indemnification
will effectively be applied as reduction to the $540 million purchase price the
Partnership paid to Teekay Corporation to acquire the Voyageur Spirit FPSO and
will not impact the Partnership's distributable cash flow. For the second
quarter of 2013, the amount of the purchase price adjustment was approximately
$12.5 million. Since April 13, 2013, the Voyageur Spirit FPSO has been operating
at partial production levels and is expected to reach full capacity levels
during August 2013."
Mr. Evensen continued, "During the second quarter, the Partnership also took
delivery of the first two of four BG shuttle tanker newbuildings, the Samba
Spirit and Lambada Spirit, with the remaining two BG shuttle tanker
newbuildings, the Bossa Nova Spirit and Sertanejo Spirit, which recently secured
long-term debt financing, scheduled for delivery in September and November of
2013. In addition, in May 2013, we were awarded a contact with Statoil Petroleum
AS to convert the 1995-built shuttle tanker, the Randgrid, to an FSO unit. The
converted FSO unit will operate on the Gina Krog oil and gas field in the North
Sea under a new three-year charter contract, plus 12 additional one-year
extension options, commencing in the first quarter of 2017."
Mr. Evensen continued, "Looking ahead, Teekay Offshore continues to bid on new
FPSO projects and are currently working on three customer-funded Front-end
Engineering and Design, or FEED, studies. In addition, through our relationship
with Remora AS, we are also engaged in a FEED study to develop the next
generation of DP HiLoad offtake units."
(1) Distributable cash flow is a non-GAAP financial measure used by certain
investors to measure the financial performance of the Partnership and
other master limited partnerships. Please see Appendix B for a
reconciliation of distributable cash flow to the most directly comparable
financial measure under United States generally accepted accounting
principles (GAAP).
Summary of Recent Transactions
Voyageur Spirit FPSO Acquisition
On May 2, 2013, the Partnership completed the acquisition of the Voyageur Spirit
floating production, storage and offloading (FPSO) unit from Teekay Corporation
for a purchase price of $540 million. The Voyageur Spirit FPSO unit has been
contracted by E.ON Ruhrgas UK E&P Limited (E.ON) to operate on the Huntington
Field in the North Sea under a five-year time-charter, plus up to 10 one-year
extension options. The acquisition has been financed with a new $330 million
debt facility secured by the FPSO unit, a portion of the proceeds from the
public offering completed in September 2012, and an equity private placement of
common units to Teekay Corporation completed in May 2013.
On April 13, 2013, the Voyageur Spirit FPSO unit achieved first oil and began
production. The charter contract with E.ON required the FPSO unit to achieve
full production capability within a specified time period to receive final
acceptance from E.ON. Due to a defective gas compressor on board the unit, the
FPSO unit was unable to achieve final acceptance within the allowable timeframe,
resulting in the FPSO unit being declared off-hire by the charterer retroactive
to April 13, 2013. Under the Voyageur Spirit FPSO sale and purchase agreement
between Teekay Corporation and Teekay Offshore, since Teekay Offshore acquired
the Voyageur Spirit, Teekay Corporation warranted that the FPSO unit would be
accepted by the charterer and agreed to indemnify Teekay Offshore for loss of
revenue under the charter with E.ON from the date of acquisition until final
acceptance is achieved, up to a maximum of $54 million. For the period from May
2, 2013 to June 30, 2013, the indemnification effectively resulted in a
reduction to the Voyageur Spirit FPSO purchase price of approximately $12.5
million.
The Partnership now expects the Voyageur Spirit FPSO to reach full production
capacity in mid-August and achieve final acceptance by the end of August 2013.
Teekay Corporation intends to enter into commercial negotiations with the
charterer to seek compensation for the services provided by the FPSO unit to
E.ON during the period prior to final acceptance since the FPSO has been
operating and producing oil at partial production levels throughout the period
since April 13, 2013.
Any amounts relating to the indemnification from Teekay Corporation to Teekay
Offshore will be effectively treated as a reduction in the purchase price paid
by Teekay Offshore. In addition, any compensation received from the charterer
during the indemnification period will reduce the amount of Teekay Corporation's
indemnification to Teekay Offshore. Although the Partnership's reported revenues
will be lower as a result of any off-hire relating to the Voyageur Spirit FPSO,
there is no net impact on the Partnership's cash flows as a result of the Teekay
Corporation indemnification.
Acquisition of a 50 Percent Interest in Cidade de Itajai FPSO
In June 2013, the Partnership completed the acquisition of a 50 percent interest
in the Cidade de Itajai (Itajai) FPSO unit from Teekay Corporation for a
purchase price of $204 million. The Itajai FPSO has been operating on the Baúna
and Piracaba (previously named Tiro and Sidon) fields in the Santos Basin
offshore Brazil since February 2013 under a nine-year fixed-rate time-charter
contract, plus extension options, with Petroleo Brasileiro SA (Petrobras). The
remaining 50 percent interest in the Itajai FPSO unit is owned by Brazilian-
based Odebrecht Oil & Gas S.A. (a member of the Odebrecht group) (Odebrecht).
The acquisition was financed with the assumption of 50% of the joint venture's
outstanding debt of approximately $290 million and approximately $54 million
with proceeds from the equity private placement completed in April 2013.
Statoil FSO Contract
In May 2013, the Partnership entered into an agreement with Statoil Petroleum AS
(Statoil), on behalf of the field license partners, to provide a floating
storage and offtake (FSO) unit for the Gina Krog oil and gas field located in
the North Sea. The contract will be serviced by a new FSO unit converted from
the 1995-built shuttle tanker, Randgrid, which the Partnership currently owns
through a 67 percent-owned subsidiary. The FSO conversion project is expected to
be completed for a net capital cost of approximately $220 million, including the
cost of acquiring the remaining 33 percent ownership interest in the Randgrid
shuttle tanker. Following scheduled completion in early 2017, the newly
converted FSO unit will commence operations under a three-year firm period time-
charter contract to Statoil, which includes 12 additional one-year extension
options.
Salamander Energy FSO Contract
In May 2013, the Partnership finalized the ten-year charter contract, plus
extension options, with Salamander Energy plc (Salamander) to supply an FSO unit
in Asia. The Partnership will convert its 1993-built shuttle tanker, the Navion
Clipper, into an FSO unit for an estimated fully built-up cost of approximately
$50 million. The unit is expected to commence its contract with Salamander in
the third quarter of 2014.
Teekay Offshore's Fleet
The following table summarizes Teekay Offshore's fleet as of August 1, 2013.
+-------------+----------------------------------------------------------------+
| | Number of Vessels |
| +--------------------------------------------------------+-------+
| | Committed | |
| | Newbuildings | |
| | Owned Chartered- / Conversion| |
| |Vessels in Vessels Conversions Candidates ((iii))| Total|
| +--------------------------------------------------------+-------+
|Shuttle | | |
|Tanker | | |
|Segment |29((i)) 4 2((ii)) 1| 36|
| | | |
|FPSO Segment |5((iv)) - - -| 5|
| | | |
|Conventional | | |
|Tanker | | |
|Segment | 5 - - -| 5|
| | | |
|FSO Segment | 5 - 1((v)) -| 6|
+-------------+--------------------------------------------------------+-------+
|Total 44 4 3 1| 52|
+----------------------------------------------------------------------+-------+
i. Includes six shuttle tankers in which Teekay Offshore's ownership interest
is 50 percent and two shuttle tankers in which Teekay Offshore's ownership
interest is 67 percent. One of the 67 percent owned shuttle tankers,
the Randgrid, will be converted to an FSO unit for the Statoil project
after its current charter contract expires in 2015.
ii. Includes two shuttle tanker newbuildings expected to deliver in September
2013 and November 2013 and to commence operations under 10-year charter
contracts with a subsidiary of BG Group plc in Brazil.
iii. Includes one shuttle tanker which is currently in lay-up and is a
candidate for conversion to an offshore asset.
iv. Includes one FPSO unit in which Teekay Offshore's ownership interest is
50 percent.
v. Includes the Navion Clipper shuttle tanker, which is currently being
converted into an FSO unit and is expected to commence operations under a
10-year charter contract in the third quarter of 2014 with Salamander
Energy plc.
Other Future Growth Opportunities
Pursuant to an omnibus agreement that the Partnership entered into in connection
with our initial public offering in December 2006, Teekay Corporation is
obligated to offer to the Partnership its interest in certain shuttle tankers,
FSO units and FPSO units Teekay Corporation owns or may acquire in the future,
provided the vessels are servicing contracts with remaining durations of greater
than three years. The Partnership may also acquire other vessels that Teekay
Corporation may offer it from time to time and also intends to pursue direct
acquisitions from third parties and new organic offshore projects.
Shuttle Tankers
In June 2011, the Partnership entered into a new long-term contract with a
subsidiary of BG Group plc (BG) to provide shuttle tanker services in Brazil.
The contract with BG will be serviced by four Suezmax newbuilding shuttle
tankers (the BG Shuttle Tankers), constructed by Samsung Heavy Industries for an
estimated total cost of approximately $446 million (excluding capitalized
interest and miscellaneous construction costs). The BG Shuttle Tankers will
operate under ten-year, fixed-rate time-charter-out contracts, which include
certain extension options and vessel purchase options exercisable by the
charterer. In May 2013, the Partnership took delivery of the Samba Spirit, the
first of the four shuttle tanker newbuildings, which commenced its time-charter
contract with BG in late June 2013. In June 2013, the Partnership took delivery
of the Lambada Spirit, the second of the four shuttle tanker newbuildings, which
will commence its time-charter contract with BG in August 2013. The remaining
two shuttle tanker newbuildings, which recently received financing commitments
through a ten-year senior secured private placement, are scheduled to be
delivered in September 2013 and November 2013, respectively.
In November 2012, the Partnership agreed to acquire a 2010-built HiLoad Dynamic
Positioning (DP) unit from Remora AS (Remora), a Norway-based offshore marine
technology company, for a total purchase price of approximately $55 million,
including modification costs. The acquisition of the HiLoad DP unit, which will
operate under a ten-year time-charter contract with Petrobras in Brazil, was
completed in August 2013 and the unit is expected to commence operations at its
full time-charter rate in early 2014 once modifications, delivery of the DP unit
to Brazil, and operational testing have been completed. Under the terms of an
agreement between Remora and Teekay Offshore, the Partnership has the right of
first refusal to acquire any future HiLoad DP projects developed by Remora. In
July 2013, Remora was awarded a contract by BG Brasil to perform a FEED study to
develop the next generation of HiLoad DP units. The design, which is based on
the main parameters of the first generation design, will include new features,
such as increased engine power and the capability to maneuver vessels larger
than Suezmax conventional tankers.
FPSO Units
In May 2011, Teekay Corporation entered into a joint venture agreement with
Odebrecht to jointly pursue FPSO projects in Brazil. Odebrecht is a well-
established Brazil-based company that operates in the engineering and
construction, petrochemical, bioenergy, energy, oil and gas, real estate and
environmental engineering sectors, with over 120,000 employees and a presence in
over 20 countries. As part of the joint venture agreement, Odebrecht is a 50
percent partner in the Cidade de Itajai FPSO project and Teekay Corporation is
currently working with Odebrecht on other FPSO project opportunities that, if
awarded, may result in the Partnership being able to acquire Teekay
Corporation's interests in such projects pursuant to the omnibus agreement.
Pursuant to the omnibus agreement and subsequent agreements, Teekay Corporation
is obligated to offer to sell to the Partnership thePetrojarl Foinaven FPSO
unit, an existing unit owned by Teekay Corporation and operating under a long-
term contract in the North Sea, prior to July 9, 2014. The purchase price for
the Petrojarl Foinaven would be its fair market value plus any additional tax or
other costs incurred by Teekay Corporation to transfer ownership of this FPSO
unit to the Partnership.
In June 2011, Teekay Corporation entered into a contract with BG Norge Limited
to provide a harsh weather FPSO unit to operate in the North Sea. The contract
will be serviced by an FPSO unit being constructed by Samsung Heavy Industries
for a fully built-up cost of approximately $1 billion. Pursuant to the omnibus
agreement, Teekay Corporation is obligated to offer to the Partnership its
interest in this FPSO project at Teekay Corporation's fully built-up cost within
a year after the commencement of the charter, which commencement is expected to
occur mid-2014.
In November 2011, Teekay Corporation acquired from Sevan Marine ASA, a Norway-
based developer of cylindrical-shaped FPSO units, theHummingbird Spirit FPSO
unit, which is currently operating under a short-term charter contract. Pursuant
to the omnibus agreement, Teekay Corporation is obligated to offer to the
Partnership the Hummingbird Spirit FPSO unit within approximately one year
following commencement of a charter contract with a firm period of greater than
three years in duration.
Teekay Corporation owns two additional FPSO units, the Petrojarl Banff FPSO and
the Petrojarl 1 FPSO, which may also be offered to the Partnership in the future
pursuant to the omnibus agreement.
Financial Summary
The Partnership reported adjusted net income attributable to the
partners((1)) of $9.7 million for the quarter ended June 30, 2013, compared to
$20.6 million for the same period of the prior year. Adjusted net income
attributable to the partners excludes a number of specific items that had the
net effect of increasing net income by $47.9 million and decreasing net income
by $32.8 million for the quarters ended June 30, 2013 and June 30, 2012,
respectively, as detailed in Appendix A to this release. Including these items,
the Partnership reported, on a GAAP basis, net income attributable to the
partners of $57.6 million for the second quarter of 2013, compared to a net loss
of $12.1 million in the same period of the prior year. Net
revenues((2)) increased to $199.1 million for the second quarter of 2013,
compared to $190.5 million in the same period of the prior year.
The Partnership reported adjusted net income attributable to the
partners((1)) of $28.6 million for the six months ended June 30, 2013, compared
to $46.7 million for the same period of the prior year. Adjusted net income
attributable to the partners excludes a number of specific items that had the
net effect of increasing net income by $49.2 million and decreasing net income
by $6.2 million for the six months ended June 30, 2013 and June 30, 2012,
respectively, as detailed in Appendix A to this release. Including these items,
the Partnership reported, on a GAAP basis, net income attributable to the
partners of $77.7 million for the six months ended June 30, 2013, compared to
$40.5 million in the same period of the prior year. Net revenues((2) )for the
six months ended June 30, 2013 was $388.3 million, which is consistent with the
same period of the prior year.
(1) Adjusted net income attributable to the partners is a non-GAAP financial
measure. Please refer to Appendix A included in this release for a
reconciliation of this non-GAAP measure to the most directly comparable
financial measure under GAAP and information about specific items
affecting net income that are typically excluded by securities analysts in
their published estimates of the Partnership'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 refer to
Appendix C included in this release for a reconciliation of this non-GAAP
measure to the most directly comparable financial measure under GAAP
Adjusted net income attributable to the partners for the three and six months
ended June 30, 2013 declined from the same periods in the prior year, mainly due
to the Voyageur Spirit FPSO off-hire discussed elsewhere in this release and the
sale and lay-up of older shuttle and conventional tankers during 2012 and 2013
as their related charter contracts expired or terminated. In addition, there is
a higher level of maintenance activity in the FPSO fleet during the first six
months of 2013. Given the delay in the achieving final acceptance for
the Voyageur Spirit FPSO unit, the Partnership has not recorded the revenues
associated with its operations in the second quarter; however, $12.5 million has
been reimbursed by our sponsor, Teekay Corporation, which is recorded in equity
as an adjustment to the purchase price. As a result of the indemnification from
Teekay Corporation, there is no net impact on the Partnership's cash flows
relating to the Voyageur Spirit FPSO off-hire.
Adjusted net income is expected to increase during the latter half of 2013 when
the Voyageur Spirit reaches final acceptance and the four shuttle tanker
newbuildings begin their time-charter contracts in Brazil.
For accounting purposes, the Partnership is required to recognize, through the
consolidated statements of income (loss), changes in the fair value of certain
derivative instruments as unrealized gains or losses. This revaluation does not
affect the economics of any hedging transactions nor does it have any impact on
the Partnership's actual cash flows or the calculation of its distributable cash
flow.
The Partnership has recast its financial results to include the results of the
Voyageur Spirit FPSO unit relating to the period prior to its acquisition by the
Partnership from Teekay when it was under common control, which pre-acquisition
results are referred to in this release as the Dropdown Predecessor. In
accordance with GAAP, business acquisitions of entities under common control
that have begun operations are required to be accounted for in a manner whereby
the Partnership's financial statements are retroactively adjusted to include the
historical results of the acquired vessels from the date the vessel was
originally under the control of Teekay. For these purposes, the Voyageur
SpiritFPSO was under common control by Teekay from April 13, 2013 to May
2, 2013, when it was sold to the Partnership.
Operating Results
The following table highlights certain financial information for Teekay
Offshore's four segments: the Shuttle Tanker segment, the FPSO segment, the
Conventional Tanker segment and the FSO segment (please refer to the "Teekay
Offshore's Fleet" section of this release above and Appendix D for further
details).
+--------------------+---------------------------------------------------------+
| | Three Months Ended |
| | |
| | June 30, 2013 |
| | |
| | (unaudited) |
| +---------------------------------------------------------+
| | Shuttle |
|(in thousands of | Tanker FPSO Conventional FSO |
|U.S. dollars) | Segment Segment Tanker Segment Segment Total|
+--------------------+---------------------------------------------------------+
|Net revenues((1)) | 110,947 65,260 7,879 15,053 199,139|
| | |
|Vessel operating | |
|expenses | 36,511 40,074 1,619 8,315 86,519|
| | |
|Time-charter hire | |
|expense | 14,093 - - - 14,093|
| | |
|Depreciation and | |
|amortization | 28,165 17,789 1,568 2,743 50,265|
+--------------------+---------------------------------------------------------+
|CFVO from | |
|consolidated | |
|vessels((2)) | 54,422 17,234 11,810 6,749 90,215|
| | |
|CFVO from equity | |
|accounted | |
|vessel((3)) | - 1,311 - - 1,311|
| | |
|Total CFVO((2)) | 54,422 18,545 11,810 6,749 91,526|
+--------------------+---------------------------------------------------------+
+-------------------+----------------------------------------------------------+
| | Three Months Ended |
| | |
| | June 30, 2012 |
| | |
| | (unaudited) |
| +----------------------------------------------------------+
| | Shuttle |
|(in thousands of | Tanker FPSO Conventional FSO |
|U.S. dollars) | Segment Segment Tanker Segment Segment Total|
+-------------------+----------------------------------------------------------+
|Net revenues((1)) | 111,598 56,317 7,765 14,781 190,461|
| | |
|Vessel operating | |
|expenses | 39,653 28,203 1,556 6,986 76,398|
| | |
|Time-charter hire | |
|expense | 12,969 - - - 12,969|
| | |
|Depreciation and | |
|amortization | 31,944 12,727 1,715 2,001 48,387|
+-------------------+----------------------------------------------------------+
|CFVO from | |
|consolidated | |
|vessels((2)) | 54,283 22,329 25,192 8,010 109,814|
+-------------------+----------------------------------------------------------+
(1) Net revenues is a non-GAAP financial measure used by certain investors to
measure the financial performance of shipping companies. Please refer
to Appendix C, included in this release for a reconciliation of this non-
GAAP measure to the most directly comparable GAAP financial measure.
(2) Cash flow from vessel operations (CFVO) from consolidated vessels
represents income from vessel operations before depreciation and
amortization expense, write-down of vessels and amortization of deferred
gains, includes the realized gains (losses) on the settlement of foreign
exchange forward contracts and cash flow from vessel operations relating
to its discontinued operations and excludes the cash flow from vessel
operations relating to the Partnership's Dropdown Predecessor and
adjusting for direct financing leases to a cash basis. CFVO is a non-GAAP
financial measure used by certain investors to measure the financial
performance of shipping companies. Please refer to Appendix E included in
this release for a description and reconciliation of this non-GAAP measure
to the most directly comparable GAAP financial measure.
(3) The Partnership's equity accounted investment for the three months ended
June 30, 2013 reflects the Partnership's 50 percent interest in
the Itajai FPSO unit. Please see Appendix F for a description and
reconciliation of CFVO from equity accounted vessels (a non-GAAP measure)
as used in this release to the most directly comparable GAAP financial
measure.
Shuttle Tanker Segment
Cash flow from vessel operations from the Partnership's Shuttle Tanker segment
in the second quarter of 2013 of $54.4 million was comparable with the $54.3
million generated in the second quarter of 2012. Higher revenues from increased
rates on both time-charter and contract of affreightment contracts as well as
new contracts were partially offset by the lay-up of the Navion Torinita and
the Navion Clipperupon expiration of their time-charter contracts in the second
and fourth quarters of 2012, respectively, and the sales of the Navion
Fennia andNavion Savonita in the third and fourth quarters of 2012,
respectively.
FPSO Segment
Cash flow from vessel operations from the Partnership's FPSO segment, including
the equity-accounted vessel, decreased to $18.5 million for the second quarter
of 2013 compared to $22.3 million for the same period of the prior year,
primarily due to the higher maintenance costs and higher crew wages, partially
offset by cash flow from the Itajai FPSO.
Conventional Tanker Segment
Cash flow from vessel operations from the Partnership's Conventional Tanker
segment decreased to $11.8 million in the second quarter of 2013 compared to
$25.2 million for the same period of the prior year primarily due to a $14.7
million termination fee received from Teekay Corporation in the second quarter
of 2012 for the termination of the time-charter contract for the Hamane
Spirit as well as the sale of five conventional tankers during the past twelve
months. This was partially offset by a $4.5 million termination fee received in
the second quarter of 2013 for the termination of the Gotland Spirit time-
charter contract with Teekay Corporation.
FSO Segment
Cash flow from vessel operations from the Partnership's FSO segment in the
second quarter of 2013 decreased to $6.7 million compared from $8.0 million
generated in the same period of the prior year primarily due to higher vessel
operating expenditures related to an underwater inspection of the Dampier
Spirit, as well as an increase in crewing costs in the FSO fleet.
Liquidity and Continuous Offering Program Update
In May 2013, the Partnership implemented a continuous offering program (COP)
under which the Partnership may issue new common units, representing limited
partner interests, at market prices up to maximum aggregate amount of $100
million. Through June 30, 2013, the Partnership sold an aggregate of 85,508
common units under the COP, generating proceeds of approximately $2.7 million
(including the Partnership's general partner's 2 percent proportionate capital
contribution and net of offering costs). The net proceeds from the issuance of
these common units were used for general partnership purposes.
As of June 30, 2013, the Partnership had total liquidity of $286.7 million,
which consisted of $163.7 million in cash and cash equivalents and $123.0
million in undrawn revolving credit facilities. Including the $200 million
revolving credit facility relating to the Varg FPSO completed in July 2013, the
Partnership had total liquidity of approximately $487 million as at June
30, 2013.
Conference Call
The Partnership also plans to host a conference call on Friday, August 9, 2013
at noon (ET) to discuss the results for the second quarter of 2013. All
unitholders and interested parties are invited to listen to the live conference
call by choosing from the following options:
* By dialing 1-866-322-8032 or 416-640-3406, if outside North America, and
quoting conference ID code 2823263.
* By accessing the webcast, which will be available on Teekay Offshore's
website at www.teekayoffshore.com (the archive will remain on the website
for a period of 30 days).
A supporting Second Quarter 2013 Earnings Presentation will also be available
at www.teekayoffshore.com in advance of the conference call start time.
The conference call will be recorded and available until Friday, August
16, 2013. This recording can be accessed following the live call by dialing
1-888-203-1112 or 647-436-0148, if outside North America, and entering access
code 2823263.
About Teekay Offshore Partners L.P.
Teekay Offshore Partners L.P. is an international provider of marine
transportation, oil production and storage services to the offshore oil industry
focusing on the fast-growing, deepwater offshore oil regions of the North Sea
and Brazil. Teekay Offshore is structured as a publicly-traded master limited
partnership and owns interests in 36 shuttle tankers (including four chartered-
in vessels and two committed newbuildings), five floating production, storage
and offloading (FPSO) units, six floating storage and offtake (FSO) units
(including one FSO unit under conversion) and five conventional oil tankers. The
majority of Teekay Offshore's fleet is employed on long-term, stable contracts.
In addition, Teekay Offshore has rights to participate in certain other FPSO and
shuttle tanker opportunities provided by Teekay Corporation (NYSE:TK) and Sevan
Marine ASA (Oslo Bors:SEVAN).
Teekay Offshore's common units trade on the New York Stock Exchange under the
symbol "TOO."
-----------------------------------------------------------------------------------------------
TEEKAY OFFSHORE PARTNERS L.P.
SUMMARY CONSOLIDATED STATEMENTS OF INCOME (LOSS)
(in thousands of U.S. dollars, except unit data)
---------------------+-------------------------------------------+-----------------------------
| Three Months Ended | Six months ended
| |
| June March June | June June
|30, 2013((1)) 31, 2013 30, 2012 |30, 2013((1)) 30, 2012
| |
| (unaudited) (unaudited) (unaudited) | (unaudited) (unaudited)
| |
REVENUES | 222,412 212,112 224,158 | 434,524 451,506
---------------------+-------------------------------------------+-----------------------------
| |
| |
OPERATING EXPENSES | |
| |
Voyage expenses | 23,273 22,948 33,697 | 46,221 63,214
| |
Vessel operating | |
expenses ((2)) | 86,519 77,324 76,398 | 163,843 153,258
| |
Time-charter hire | |
expense | 14,093 14,777 12,969 | 28,870 26,586
| |
Depreciation and | |
amortization | 50,265 44,510 48,387 | 94,775 96,391
| |
General and | |
administrative ((2))| 10,417 10,390 8,706 | 20,807 17,630
| |
Write-down of | |
vessels | - - 1,048 | - 1,048
| |
Restructuring | |
charge((3)) | 1,395 659 - | 2,054 -
---------------------+-------------------------------------------+-----------------------------
Total operating | |
expenses | 185,962 170,608 181,205 | 356,570 358,127
---------------------+-------------------------------------------+-----------------------------
Income from vessel | |
operations | 36,450 41,504 42,953 | 77,954 93,379
---------------------+-------------------------------------------+-----------------------------
OTHER ITEMS | |
| |
Interest expense | (16,035 ) (11,628 ) (12,267 )| (27,663 ) (24,782 )
| |
Interest income | 1,465 195 138 | 1,660 350
| |
Realized and | |
unrealized gains | |
(losses) | |
| |
on derivative | |
instruments ((4)) | 33,901 (1,077 ) (60,317 )| 32,824 (44,078 )
| |
Equity income | 1,598 - - | 1,598 -
| |
Foreign exchange | |
gains (losses)((5)) | 3,555 (3,638 ) 888 | (83 ) (1,872 )
| |
Loss on bond | |
repurchase((6)) | - (1,759 ) - | (1,759 ) -
| |
Other income | |
(expense) - net | 260 314 (119 )| 574 1,278
---------------------+-------------------------------------------+-----------------------------
Total other items | 24,744 (17,593 ) (71,677 )| 7,151 (69,104 )
---------------------+-------------------------------------------+-----------------------------
Income from | |
continuing | |
operations before | |
income tax (expense)| |
recovery | 61,194 23,911 (28,724 )| 85,105 24,275
| |
Income tax (expense)| |
recovery | (456 ) 234 1,946 | (222 ) 461
---------------------+-------------------------------------------+-----------------------------
Net income (loss) | |
from continuing | |
operations | 60,738 24,145 (26,778 )| 84,883 24,736
| |
Net (loss) income | |
from discontinued | |
operations((7)) | (2,134 ) (2,175 ) 15,149 | (4,309 ) 18,238
---------------------+-------------------------------------------+-----------------------------
Net income (loss) | 58,604 21,970 (11,629 )| 80,574 42,974
---------------------+-------------------------------------------+-----------------------------
Non-controlling | |
interests in net | |
income (loss) | 3,274 1,777 499 | 5,051 2,468
| |
Dropdown | |
Predecessor's | |
interest in net | |
income (loss) ((1)) | (2,225 ) - - | (2,225 ) -
| |
General Partner's | |
interest in net | |
income (loss)((8)) | 3,833 3,073 1,808 | 6,906 4,863
| |
Limited partners' | |
interest in net | |
income (loss)((8)) | 51,909 17,120 (13,936 )| 69,029 35,643
---------------------+-------------------------------------------+-----------------------------
Weighted-average | |
number of common | |
units - basic | 82,726,359 80,105,408 70,626,554 | 81,423,123 70,626,554
| |
Weighted-average | |
number of common | |
units -diluted | 82,742,751 80,106,741 70,626,554 | 81,432,027 70,626,554
---------------------+-------------------------------------------+-----------------------------
(1) Results for the Voyageur Spirit FPSO unit for the period beginning in
April 13, 2013 prior to its acquisition by the Partnership on May 2, 2013
when it was owned and operated by Teekay Corporation, are included in
the Dropdown Predecessor. The amounts included in this release related to
the Dropdown Predecessor are preliminary, and will be finalized for
inclusion in the Partnership's Form 6-K filing for the quarter ended June
30, 2013. Any revisions to the preliminary Dropdown Predecessor figures
are only expected to impact the accounting for the periods prior to the
date the Voyageur Spirit FPSO unit was acquired by the Partnership, and
therefore will have no effect on the adjusted net income attributable to
the partners or distributable cash flow of the Partnership for any period,
including the second quarter of 2013.
(2) In order to more closely align the Partnership's presentation to that of
many of its peers, the cost of ship management services of $9.2 million
for the three months ended March 31, 2013 and $8.6 million and $17.7
million for the three and six months ended June 30, 2013, respectively,
have been presented in vessel operating expenses. Prior to 2013, the
Partnership included these amounts in general and administrative expenses.
All such costs incurred in comparative periods have been reclassified from
general and administrative expenses to vessel operating expenses to
conform to the presentation adopted in the current period. The amounts
reclassified were $9.3 million and $19.3 million for the three and six
months ended June 30, 2012, respectively.
(3) Restructuring charge for the three and six months ended June 30, 2013
relates to the reorganization of the Partnership's marine operations to
create better alignment with its shuttle tanker and conventional tanker
business units.
(4) The realized (losses) gains on derivative instruments relate to the
amounts the Partnership actually paid or received to settle such
derivative instruments, and the unrealized gains (losses) on derivative
instruments relate to the change in fair value of such derivative
instruments, as detailed in the table below:
Three Months Ended Six months ended
June March June June June
30, 2013 31, 2013 30, 2012 30, 2013 30, 2012
Realized
(losses) gains
relating to:
Interest rate (14,956 ) (14,623 ) (14,338 ) (29,579 ) (29,345 )
swaps
Termination (4,099 ) - - (4,099 ) -
of interest
rate swap in
Dropdown
Predecessor
Foreign (1,646 ) 353 437 (1,293 ) 1,635
currency
forward
contract
---------------------------------------------------------------
(20,701 ) (14,270 ) (13,901 ) (34,971 ) (27,710 )
---------------------------------------------------------------
Unrealized
gains (losses)
relating to:
Interest rate 52,947 14,971 (41,842 ) 67,918 (17,079 )
swaps
Termination 3,984 - - 3,984 -
of interest
rate swap in
Dropdown
Predecessor
Foreign (2,329 ) (1,778 ) (4,574 ) (4,107 ) 711
currency
forward
contracts
---------------------------------------------------------------
54,602 13,193 (46,416 ) 67,795 (16,368 )
---------------------------------------------------------------
Total realized
and unrealized
gains (losses)
---------------------------------------------------------------
on non- 33,901 (1,077 ) (60,317 ) 32,824 (44,078 )
designated
derivative
instruments
---------------------------------------------------------------
(5) Foreign exchange gain (loss) includes realized gains relating to the
amounts the Partnership received to settle the Partnership's non-
designated cross currency swaps that were entered into as an economic
hedge in relation to the Partnership's Norwegian Kroner (NOK)-denominated
unsecured bonds as detailed in the table below. The Partnership issued NOK
600 million unsecured bonds in 2010 maturing in 2013 of which it
repurchased NOK 388.5 million in the first quarter of 2013 and recognized
a realized gain of $6.8 million on the partial early termination of a
cross currency swap and a realized foreign exchange loss of $6.6 million
on the repurchase of the bonds. The Partnership also issued NOK 600
million unsecured bonds in 2012 maturing in 2017 and NOK 1,300 million of
unsecured bonds in 2013 maturing in 2016 and 2018. Foreign exchange gain
(loss) also includes unrealized (losses) gains relating to the change in
fair value of such derivative instruments, partially offset by unrealized
gains (losses) on the revaluation of the NOK bonds are also detailed in
the table below:
Three Months Ended Six months ended
June March June June June
30, 2013 31, 2013 30, 2012 30, 2013 30, 2012
Realized gain
on partial
termination
of cross-
currency swap - 6,800 - 6,800 -
Realized
foreign
exchange loss
on partial
repurchase of
NOK bonds - (6,573 ) - (6,573 ) -
Realized
gains on
cross-
currency
swaps 297 725 696 1,022 1,690
Unrealized
losses on
cross-
currency
swaps (9,307 ) (25,502 ) (10,776 ) (34,809 ) (2,897 )
Unrealized
gains on
revaluation
of NOK bonds 13,250 25,011 9,414 38,261 383
(6) Loss on bond repurchase for the three months ended March 31, 2013 relates
to the repurchase of NOK 388.5 million of the Partnership's existing NOK
600 million bond issue at a premium.
(7) Results for six conventional tankers (Hamane Spirit, Torben Spirit, Luzon
Spirit, Leyte Sprit, Poul Spirit and Gotland Spirit), which we sold or
held for sale during 2012 and 2013, have been included in Net (loss)
income from discontinued operations for the three and six months ended
June 30, 2013 and June 30, 2012.
(8) The General Partner's and Limited Partners' interest in net income for
both the three months and six months ended June 30, 2013 is cumulatively
reduced by approximately $1.8 million associated with the accrued
dividends for the preferred equity units issued on April 30, 2013.
------------------------------------------------------------------------------
TEEKAY OFFSHORE PARTNERS L.P.
CONSOLIDATED BALANCE SHEETS
(in thousands of U.S. dollars)
------------------------------------------------------------------------------
As at As at As at
June 30, 2013 March 31, 2013 December 31, 2012
(unaudited) (unaudited) (unaudited)
ASSETS
Current
Cash and cash equivalents 163,744 172,801 206,339
Accounts receivable 176,189 100,715 91,879
Vessels held for sale 6,800 - 13,250
Net investments in direct
financing leases - current 5,628 5,387 5,647
Prepaid expenses 30,461 31,348 29,384
Due from affiliates 35,570 163,202 29,682
Current portion of
derivative instruments 546 3,119 12,398
Other current assets - 513 8
-------------------------------------------------------------------------------
Total current assets 418,938 477,085 388,587
-------------------------------------------------------------------------------
Vessels and equipment
At cost, less accumulated
depreciation 2,935,389 2,287,334 2,327,337
Advances on newbuilding
contracts 82,499 139,628 127,286
Investment in and advances
to joint venture 62,880 - -
Net investments in direct
financing leases 24,634 26,135 27,568
Derivative instruments 9,398 34 2,913
Deferred income tax 10,824 9,021 8,948
Other assets 36,008 31,068 28,112
Intangible assets - net 12,952 14,230 15,527
Goodwill - shuttle tanker
segment 127,113 127,113 127,113
-------------------------------------------------------------------------------
Total assets 3,720,635 3,111,648 3,053,391
-------------------------------------------------------------------------------
LIABILITIES AND EQUITY
Current
Accounts payable 23,580 12,164 15,220
Accrued liabilities 154,188 73,701 84,349
Due to affiliates 92,123 41,852 47,810
Current portion of long-term
debt 288,690 250,414 248,385
Current portion of
derivative instruments 89,111 47,874 47,748
Current portion of in-
process revenue contracts 12,744 12,744 12,744
-------------------------------------------------------------------------------
Total current liabilities 660,436 438,749 456,256
-------------------------------------------------------------------------------
Long-term debt 1,895,628 1,623,410 1,521,247
Derivative instruments 137,999 213,757 213,731
In-process revenue contracts 95,009 98,151 101,294
Other long-term liabilities 37,072 25,643 26,819
-------------------------------------------------------------------------------
Total liabilities 2,826,144 2,399,710 2,319,347
-------------------------------------------------------------------------------
Redeemable non-controlling
interest 28,357 28,383 28,815
Equity
Limited partners - common
units (83.7 and 80.1 million
units issued and outstanding
at June 30, 2013 and
December 31, 2012,
respectively) 649,814 617,199 640,990
Limited partners - preferred
units (6.0 and nil million
units issued and outstanding
at June 30, 2013 and
December 31, 2012,
respectively) 144,921 - -
General Partner 20,475 20,012 20,162
Accumulated other
comprehensive loss - - (58 )
-------------------------------------------------------------------------------
Partners' equity 815,210 637,211 661,094
-------------------------------------------------------------------------------
Non-controlling interests 50,924 46,344 44,135
-------------------------------------------------------------------------------
Total equity 866,134 683,555 705,229
-------------------------------------------------------------------------------
Total liabilities and total
equity 3,720,635 3,111,648 3,053,391
-------------------------------------------------------------------------------
------------------------------------------------------------------------------
TEEKAY OFFSHORE PARTNERS L.P.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of U.S. dollars)
------------------------------------------------------------------------------
Six months ended
June 30, 2013((1)) June 30, 2012
(unaudited) (unaudited)
Cash and cash equivalents provided by
(used for)
OPERATING ACTIVITIES
Net income 80,574 42,974
Non-cash items:
Unrealized (gain) loss on derivative
instruments (32,927 ) 19,499
Equity income (1,598 ) -
Depreciation and amortization 96,011 99,614
Write-down and loss on sale of vessels 19,029 3,269
Deferred income tax (recovery) expense (62 ) 91
Foreign currency exchange gain and
other (36,098 ) (7,543 )
Change in non-cash working capital items
related to operating activities 6,919 (23,056 )
Expenditures for dry docking (7,656 ) (8,619 )
-------------------------------------------------------------------------------
Net operating cash flow 124,192 126,229
-------------------------------------------------------------------------------
FINANCING ACTIVITIES
Proceeds from long-term debt 736,725 265,053
Scheduled repayments of long-term debt (97,215 ) (95,032 )
Prepayments of long-term debt (424,152 ) (203,273 )
Debt issuance costs (10,126 ) (4,362 )
Equity contribution from Teekay
Corporation to Dropdown Predecessor 5,596 -
Purchase of Voyageur LLC from Teekay
Corporation (252,086 ) -
Equity contribution from joint venture
partner 1,500 1,000
Proceeds from issuance of common units 65,067 -
Proceeds from issuance of preferred units 150,000 -
Expenses relating to equity offerings (5,385 ) (117 )
Cash distributions paid by the
Partnership (90,972 ) (76,779 )
Cash distributions paid by subsidiaries
to non-controlling interests (280 ) (5,657 )
-------------------------------------------------------------------------------
Net financing cash flow 78,672 (119,167 )
-------------------------------------------------------------------------------
INVESTING ACTIVITIES
Expenditures for vessels and equipment (216,242 ) (26,148 )
Purchase of equity investment in Itajai
joint venture (52,520 ) -
Datum: 08.08.2013 - 17:06 Uhr
Sprache: Deutsch
News-ID 286145
Anzahl Zeichen: 65593
contact information:
Kategorie:
Business News
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"Teekay Offshore Partners Reports Second Quarter Results"
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