Teekay LNG Partners Reports Third Quarter 2015 Results
(firmenpresse) - HAMILTON, BERMUDA -- (Marketwired) -- 11/05/15 -- Highlights
Teekay GP L.L.C., the general partner of Teekay LNG Partners L.P. (Teekay LNG or the Partnership) (NYSE: TGP), today reported the Partnership's results for the quarter ended September 30, 2015. During the third quarter of 2015, the Partnership generated distributable cash flow(1) of $61.1 million, compared to $64.2 million in the same period of the prior year. The decrease in distributable cash flow was primarily due to the termination of the charter contract for the Partnership's 52 percent-owned Magellan Spirit liquefied natural gas (LNG) carrier in March 2015 (which termination the Partnership's joint venture with Marubeni Corporation is currently disputing), the scheduled expiration of the charter contract for the Partnership's 52 percent-owned Methane Spirit LNG carrier in March 2015 and the sale of one 2001-built conventional tanker in August 2014. These decreases were partially offset by the lower interest expense resulting from the December 2014 termination of capital leases for, and the subsequent refinancing of, three 70 percent-owned LNG carriers, an increase in the charter rates for two of the Partnership's Suezmax tankers and the acquisition of one liquefied petroleum gas (LPG) carrier, the Norgas Napa, in November 2014.
On October 2, 2015, the Partnership declared a cash distribution of $0.70 per unit for the quarter ended September 30, 2015. The cash distribution will be paid on November 13, 2015 to all unitholders of record on October 13, 2015.
CEO Commentary
"The Partnership generated stronger than expected distribution coverage in the third quarter, primarily due to higher than expected revenues from our Exmar LPG joint venture," commented Peter Evensen, Chief Executive Officer of Teekay GP LLC. "Teekay LNG's distributable cash flow remains stable and growing. The Partnership's diversified portfolio of fee-based contracts, with no direct link to commodity prices, comprises fixed forward revenues of approximately $11.3 billion."
"Our project teams remain focused on the execution of the Partnership's growth portfolio, including delivery of the world's first ever MEGI LNG carrier newbuildings," Mr. Evensen continued. "The first two of the Partnership's MEGI LNG carrier newbuildings are expected to deliver starting in early-2016, with the first vessel having recently commenced sea trials and the second vessel having been launched at the shipyard during the third quarter. These vessels, which we expect will be financed under a new, approximately $360 million long-term lease facility upon delivery, will both operate under fee-based charter contracts with Cheniere Energy to export LNG from Cheniere's Sabine Pass LNG export facility, which is expected to ship its first LNG cargo in early-2016. In addition, with strong support from a broad group of international banks, the Partnership recently secured a new $150 million unsecured credit facility that can be used to finance a portion of our remaining capital commitments."
Financial Summary
The Partnership reported adjusted net income attributable to the partners(1) of $37.1 million for the quarter ended September 30, 2015, 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 decreasing net income by $29.6 million and increasing net income by $43.9 million for the three months ended September 30, 2015 and 2014, respectively, primarily relating to unrealized gains and losses on derivative instruments and foreign currency exchange gains and losses, as detailed in Appendix A to this release. Including these items, the Partnership reported net income attributable to the partners, on a GAAP basis, of $7.5 million and $90.6 million for the three months ended September 30, 2015 and 2014, respectively.
Adjusted net income attributable to the partners for the three months ended September 30, 2015 decreased from the same period in the prior year, primarily due to the Magellan Spirit LNG carrier disputed charter contract termination during the first quarter of 2015, the scheduled expiration of the charter contract for the Methane Spirit LNG carrier in mid-March 2015 and the sale of one conventional tanker in August 2014. These decreases were partially offset by higher LPG spot rates earned in 2015 and the addition of four LPG carrier newbuildings that delivered during 2014 and early 2015, net of the sale of four older LPG carriers during 2014 in the Partnership's 50 percent-owned LPG joint venture, Exmar LPG BVBA, the termination of capital leases for, and the subsequent refinancing at a lower interest rate of, three LNG carriers owned by the Partnership's RasGas II joint venture in December 2014, and the acquisition of one LPG carrier, the Norgas Napa, in November 2014.
For accounting purposes, the Partnership is required to recognize the changes in the fair value of its outstanding derivative instruments that are not designated as hedges for accounting purposes in net income. This method of accounting does not affect the Partnership's cash flows or the calculation of distributable cash flow, but results in the recognition of unrealized gains or losses on the consolidated statements of income as detailed in notes 2, 3 and 4 to the Consolidated Statements of Income and Comprehensive Income included in this release.
Operating Results
The following table highlights certain financial information for Teekay LNG's two segments: the Liquefied Gas Segment and the Conventional Tanker Segment (please refer to the "Teekay LNG's Fleet" section of this release below and Appendices C through F for further details).
Liquefied Gas Segment
Cash flow from vessel operations from the Partnership's Liquefied Gas segment, excluding equity accounted vessels, was $58.8 million in the third quarter of 2015 compared to $62.5 million in the same quarter of the prior year. The decrease was primarily due to the depreciation of the Euro against the U.S. Dollar compared to the same quarter of the prior year, partially offset by the acquisition of the Norgas Napa in November 2014.
Cash flow from vessel operations from the Partnership's equity accounted vessels in the Liquefied Gas segment was $45.1 million in the third quarter of 2015 compared to $51.8 million in the same quarter of the prior year. The decrease was primarily due to the disputed termination of the charter contract for the Magellan Spirit in March 2015 and the scheduled expiration of the charter contract for the Methane Spirit in mid-March 2015. Both the Magellan Spirit and Methane Spirit are owned through the Partnership's 52 percent interest in the joint venture with Marubeni Corporation. The decreases was partially offset by increased cash flows from the Partnership's 50 percent interest in Exmar LPG BVBA, as a result of higher LPG spot rates and the addition to the joint venture of four LPG carrier newbuildings that delivered during 2014 and early 2015, net of the sale of four older LPG carriers during 2014.
Conventional Tanker Segment
Cash flow from vessel operations from the Partnership's Conventional Tanker segment increased to $10.3 million in the third quarter of 2015 compared to $8.9 million in the same quarter of the prior year. The increase is due to higher charter rates earned by two of the Partnership's Suezmax tankers, the Bermuda Spirit and Hamilton Spirit, which reverted back to their original charter rates in October 2014 after a two-year reduction, partially offset by the sale of one 2001-built Suezmax tanker in August 2014.
Teekay LNG's Fleet
The following table summarizes the Partnership's fleet as of November 1, 2015:
Liquidity and Continuous Offering Program Update
In 2013, the Partnership implemented a continuous offering program (COP) under which the Partnership may issue new common units at market prices up to a maximum aggregate amount of $100 million. During the third quarter of 2015, the Partnership sold an aggregate of 701,496 common units under the COP, generating net proceeds of approximately $18.4 million (including the general partner's 2 percent contribution and net of offering costs). Since initiation of the program, the Partnership has sold an aggregate of 2,315,822 common units under the COP, generating net proceeds of approximately $81.4 million (including the general partner's 2 percent contribution and net of offering costs).
As of September 30, 2015, the Partnership had total liquidity of $206.3 million (comprised of $154.2 million in cash and cash equivalents and $52.1 million in undrawn credit facilities). Subsequent to September 30, 2015, the Partnership secured a new $150 million unsecured revolving credit facility to fund future capital commitments, which is expected to be completed in November 2015.
Conference Call
The Partnership plans to host a conference call on Thursday, November 5, at 11:00 a.m. (ET) to discuss the results for the third quarter of 2015. All unitholders and interested parties are invited to listen to the live conference call by choosing from the following options:
A supporting Third Quarter 2015 Earnings Presentation will also be available at in advance of the conference call start time.
The conference call will be recorded and made available until Thursday, November 19, 2015. This recording can be accessed following the live call by dialing (888) 203-1112 or (647) 436-0148, if outside North America, and entering access code 2325564.
About Teekay LNG Partners L.P.
Teekay LNG Partners is one of the world's largest independent owners and operators of LNG carriers, providing LNG, LPG and crude oil marine transportation services primarily under long-term, fixed-rate charter contracts through its interests in 50 LNG carriers (including one LNG regasification unit and 21 newbuildings), 30 LPG/Multigas carriers (including three in-chartered LPG carriers and seven newbuildings) and eight conventional tankers. The Partnership's interests in these vessels range from 20 to 100 percent. Teekay LNG Partners L.P. is a publicly-traded master limited partnership (MLP) formed by Teekay Corporation (NYSE: TK) as part of its strategy to expand its operations in the LNG and LPG shipping sectors.
Teekay LNG Partners' common units trade on the New York Stock Exchange under the symbol "TGP".
Set forth below is a reconciliation of the Partnership's unaudited adjusted net income attributable to the partners, a non-GAAP financial measure, to net income attributable to the partners as determined in accordance with GAAP. The Partnership believes that, in addition to conventional measures prepared in accordance with GAAP, certain investors use this information to evaluate the Partnership's financial performance. The items below are also typically excluded by securities analysts in their published estimates of the Partnership's financial results.
Adjusted net income attributable to the partners is intended to provide additional information and should not be considered a substitute for measures of performance prepared in accordance with GAAP.
Distributable cash flow represents net income adjusted for depreciation and amortization expense, non-cash items, estimated maintenance capital expenditures, unrealized gains and losses from derivatives, distributions relating to equity financing of newbuilding installments, equity income, adjustments for direct financing leases to a cash basis, and foreign exchange related items. Maintenance capital expenditures represent those capital expenditures required to maintain over the long-term the operating capacity of, or the revenue generated by, the Partnership's capital assets. Distributable cash flow is a quantitative standard used in the publicly-traded partnership investment community to assist in evaluating a partnership's ability to make quarterly cash distributions. Distributable cash flow is not required by GAAP and should not be considered as an alternative to net income or any other indicator of the Partnership's performance required by GAAP. The table below reconciles distributable cash flow to net income.
Net voyage revenues represents voyage revenues less voyage expenses, which comprise all expenses relating to certain voyages, including bunker fuel expenses, port fees, cargo loading and unloading expenses, canal tolls, agency fees and commissions. Net voyage revenues is included because certain investors use this data to measure the financial performance of shipping companies. Net voyage revenues is not required by GAAP and should not be considered as an alternative to voyage revenues or any other indicator of the Partnership's performance required by GAAP.
Cash flow from vessel operations from consolidated vessels represents income from vessel operations before (a) depreciation and amortization expense, (b) amortization of in-process revenue contracts included in voyage revenues, and includes (c) adjustments for direct financing leases to a cash basis, realized gains or losses on the Toledo Spirit derivative contract, and the revenue for two Suezmax tankers recognized to a cash basis. The
Partnership's direct financing leases for the periods indicated relate to the Partnership's 69 percent interest in two LNG carriers, the Tangguh Sago and Tangguh Hiri, and the two LNG carriers acquired from Awilco. The
Partnership's cash flow from vessel operations from consolidated vessels does not include the Partnership's cash flow from vessel operations from its equity accounted joint ventures. Cash flow from vessel operations is included because certain investors use cash flow from vessel operations to measure a company's financial performance, and to highlight this measure for the Partnership's consolidated vessels. Cash flow from vessel operations from consolidated vessels is not required by GAAP and should not be considered as an alternative to net income or any other indicator of the Partnership's performance required by GAAP.
Cash flow from vessel operations from equity accounted vessels represents income from vessel operations before (a) depreciation and amortization expense, (b) amortization of in-process revenue contracts, (c) gain on sale of vessels and includes (d) adjustments for direct financing leases to a cash basis. Cash flow from vessel operations from equity accounted vessels is included because certain investors use cash flow from vessel operations to measure a company's financial performance, and to highlight this measure for the Partnership's equity accounted joint ventures. Cash flow from vessel operations from equity-accounted vessels is not required by GAAP and should not be considered as an alternative to equity income or any other indicator of the Partnership's performance required by GAAP.
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 timing and certainty of completing the new $150 million unsecured revolving credit facility and the new, approximately $360 million long-term lease facility for the first two
MEGI LNG carrier newbuildings; the stability and growth of the Partnership's future distributable cash flows; the Partnership's expected fixed future revenues; the delivery timing of newbuilding vessels and the commencement of related time charter contracts; the outcome of the Partnership's dispute over the Magellan Spirit charter contract termination; and the timing of the commencement of operations of the Sabine Pass LNG project. 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: potential shipyard construction delays, newbuilding specification changes or cost overruns; changes in production of LNG or LPG, either generally or in particular regions; changes in trading patterns or timing of start- up of new LNG liquefaction and regasification projects significantly affecting overall vessel tonnage requirements; changes in applicable industry laws and regulations and the timing of implementation of new laws and regulations; the potential for early termination of long-term contracts of existing vessels in the Teekay LNG fleet; the inability of charterers to make future charter payments; the inability of the Partnership to renew or replace long-term contracts on existing vessels; failure by the Partnership to complete the new $150 million unsecured revolving credit facility or the approximately $360 million long-term lease facility for the two MEGI LNG carrier newbuildings; factors affecting the outcome of the Partnership's dispute over the Magellan Spirit; the
Partnership's ability to raise financing for its existing newbuildings or to purchase additional vessels or to pursue other projects; and other factors discussed in Teekay LNG Partners' filings from time to time with the SEC, including its Report on Form 20-F for the fiscal year ended December 31, 2014 and its Report on Form 6-K for the quarterly period ended June 30, 2015. The Partnership expressly disclaims any obligation to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Partnership's expectations with respect thereto or any change in events, conditions or circumstances on which any such statement is based.
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+1 (604) 609-6442
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Datum: 05.11.2015 - 06:30 Uhr
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