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Teekay Corporation Reports Third Quarter Results HAMILTON, BERMUDA--(Marketwire - 11/13/09) - Teekay Corporation (Teekay or the Company) (NYSE:TK - News) today reported an adjusted net loss attributable to stockholders of Teekay(1) of $43.4 million, or $0.60 per share, for the quarter ended September 30, 2009, compared to adjusted net income of $94.3 million, or $1.29 per share, attributable to the stockholders of Teekay for the same period of the prior year. Adjusted net income (loss) attributable to stockholders of Teekay excludes a number of specific items which had the net effect of decreasing net income by $98.9 million (or $1.36 per share) for the three months ended September 30, 2009 and increasing net income by $8.9 million (or $0.12 per share) for the three months ended September 30, 2008, as detailed in Appendix A to this release. Including these items, the Company reported net loss attributable to the stockholders of Teekay, on a GAAP basis, of $142.2 million(2), or $1.96 per share, for the quarter ended September 30, 2009, compared to net income attributable to the stockholders of Teekay, on a GAAP basis, of $103.1 million(2), or $1.41 per share, for the same period of the prior year. Net revenues(3) for the third quarter of 2009 were $428.7 million compared to $667.2 million for the same period of the prior year. For the nine months ended September 30, 2009, the Company reported an adjusted net loss attributable to stockholders of Teekay of $54.2 million, or $0.74 per share, compared to adjusted net income attributable to stockholders of Teekay of $232.1 million, or $3.17 per share, for the same period of the prior year, excluding a number of specific items which had the net effect of increasing net income by $152.8 million (or $2.09 per share) and decreasing net income by $50.7 million (or $0.69 per share), respectively, as detailed in Appendix A to this release. Including these items, the Company reported net income attributable to the stockholders of Teekay, on a GAAP basis, of $98.6 million, or $1.35 per share, compared to net income attributable to the stockholders of Teekay, on a GAAP basis, of $181.4 million, or $2.48 per share, for the same period of the prior year. Net revenues for the nine months ended September 30, 2009 were $1.4 billion compared to $1.9 billion for the same period of the prior year. On October 1, 2009, the Company declared a cash dividend on its common stock of $0.31625 per share for the quarter ended September 30, 2009. The cash dividend was paid on October 30, 2009, to all shareholders of record on October 16, 2009. (1) Adjusted net income (loss) attributable to stockholders of Teekay is a non-GAAP financial measure. Please refer to Appendix A to this release for a reconciliation of this non-GAAP measure as used in this release to the most directly comparable financial measure under United States generally accepted accounting principles (GAAP) and information about specific items affecting net income which are typically excluded by securities analysts in their published estimates of the Company's financial results. (2) Effective January 1, 2009, Teekay amended the accounting and reporting for non-controlling interest, which is now classified as a component of equity. (3) Net revenues represents revenues less voyage expenses. 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 Web site 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 United States GAAP. "In today's weak tanker market we are really seeing the benefits of our business mix," commented Bjorn Moller, Teekay Corporation's President and Chief Executive Officer. "With our growing fixed-rate offshore, liquefied gas and conventional tanker businesses largely insulated from the poor spot tanker market, they are providing a significant amount of stable cash flow from vessel operations. Over 80 percent of our capital is invested in our fixed-rate businesses." Mr. Moller continued, "Our key priorities continue to be to reduce our near-term exposure to the current weak spot tanker market, which led to our net loss in the quarter, to improve profitability across all our businesses and to lower our debt at the Teekay parent company level. This focus is yielding good results. Over the last four quarters, we have out-chartered 13 conventional tankers which has translated into additional fixed-rate cash flows. During the same period we redelivered 24 in-chartered vessels resulting in time-charter hire expense savings of almost $60 million per quarter. We continue to make significant progress on our cost management initiatives which have resulted in total annualized run-rate operating and overhead cost savings of approximately $96 million, or $1.32 per share. In addition, our strategy of selling assets to our daughter companies and third parties has enabled significant de-leveraging at the Teekay parent company level. Including the dropdown of the Petrojarl Varg FPSO in September and the new Petrojarl Varg credit facility signed earlier this week, net debt at the Teekay parent company level has been reduced by over $460 million since September 30, 2008, providing further financial flexibility." Mr. Moller added, "With over $2.0 billion of total consolidated liquidity, a fully-financed newbuilding program, a favorable debt maturity profile with no significant near-term maturities, and no debt covenant concerns, Teekay remains financially well-positioned to benefit from future investment opportunities." Operating Results The following tables highlight certain financial information for each of Teekay's four publicly-listed entities: Teekay Offshore Partners L.P. (Teekay Offshore) (NYSE:TOO - News), Teekay LNG Partners L.P. (Teekay LNG) (NYSE:TGP - News), Teekay Tankers Ltd. (Teekay Tankers) (NYSE:TNK - News) and Teekay, excluding results attributed to Teekay Offshore, Teekay LNG and Teekay Tankers, referred to herein as Teekay Parent. A brief description of each entity and an analysis of its respective financial results follows 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, 2009(i)
(unaudited)
Teekay
Teekay Teekay Conso- Corp-
Offshore LNG Teekay lidation oration
(in thousands Partners Partners Tankers Teekay Adjust- Conso-
of U.S. dollars) LP LP Ltd. Parent ments lidated
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Net revenues(1) 176,675 79,040 20,611 195,090 (42,707) 428,709
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Vessel operating
expenses(1) 54,857 19,126 7,677 65,782 - 147,442
Time-charter
hire expense 27,772 - - 109,899 (42,707) 94,964
Depreciation and
amortization 40,981 18,901 6,906 40,323 - 107,111
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Cash flow from
vessel
operations
(2)(3) 63,796 53,928 11,120 (16,866) - 111,978
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Net debt(4) 1,407,692 1,490,383 292,732 1,003,947 - 4,194,754
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Three Months Ended September 30, 2008
(unaudited)
Teekay
Teekay Teekay Conso- Corp-
Offshore LNG Teekay lidation oration
(in thousands Partners Partners Tankers Teekay Adjust- Conso-
of U.S. dollars) LP LP Ltd. Parent ments lidated
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Net revenues(1) 189,684 76,899 46,596 396,650 (42,662) 667,167
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Vessel operating
expenses(1) 57,359 17,500 8,669 76,610 - 160,138
Time-charter
hire expense 31,474 - - 169,010 (42,662) 157,822
Depreciation and
amortization 39,675 19,105 7,101 42,612 - 108,493
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Cash flow from
vessel
operations
(2)(3) 71,972 55,232 34,504 109,890 - 271,598
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Net debt(4) 1,450,870 2,294,968 302,855 1,305,268 - 5,353,961
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(1) Commencing in 2009 and applied retroactively, the gains and losses
related to non-designated derivative instruments have been reclassified
to a separate line item in the Statements of Income (Loss) and are no
longer included in the amounts above.
(2) Cash flow from vessel operations represents income from vessel
operations before depreciation and amortization expense, vessel/
goodwill write-downs, gains and losses on the sale of vessels 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. 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.
(3) Excludes the cash flow from vessel operations relating to assets
acquired from Teekay Parent for the periods prior to their acquisition
by Teekay Offshore, Teekay LNG and Teekay Tankers, respectively, as
those results are included in the historical results for Teekay Parent.
(4) Net debt represents current and long-term debt less cash and, if
applicable, current and long-term restricted cash.
Teekay Offshore Partners L.P. Teekay Offshore is an international provider of marine transportation and storage services to the offshore oil industry. Through its 51 percent ownership interest in Teekay Offshore Operating L.P. (OPCO), Teekay Offshore operates a fleet of 34 shuttle tankers (including nine chartered-in vessels), four Floating Storage and Offtake (FSO) units, nine conventional oil tankers and two lightering vessels. Teekay Offshore also has direct ownership interests in two shuttle tankers, one FSO unit, one Floating, Production, Storage and Offloading (FPSO) unit and has the right to participate in certain other FPSO opportunities. On September 10, 2009, Teekay Offshore acquired the Petrojarl Varg FPSO unit and its associated fixed-rate contract from Teekay for $320 million. As at September 30, 2009, Teekay Parent directly owned the remaining 49 percent interest in OPCO, as well as a 40.47 percent interest in Teekay Offshore (including the two percent General Partner interest). Cash flow from vessel operations from Teekay Offshore decreased to $63.8 million in the third quarter of 2009, from $72.0 million in the same period of the prior year, primarily due to lower shuttle tanker utilization, partially offset by a lower time-charter hire expense as a result of a reduced in-chartered fleet size and the contribution from the Petojarl Varg FPSO for 21 days during the third quarter of 2009. On August 4, 2009, Teekay Offshore completed a follow-on equity offering of 7.475 million common units (including underwriters' overallotment option which was exercised in full), raising net proceeds of $104.3 million. Proceeds from the offering were used to repay amounts drawn under Teekay Offshore's revolving credit facilities and for general corporate purposes. On November 12, 2009, Teekay Offshore signed a new $260 million revolving credit facility secured by the Petrojarl Varg FPSO. 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 time-charter contracts with major energy and utility companies through its current fleet of fifteen LNG carriers, three LPG carriers and eight Suezmax crude oil tankers. In addition, Teekay LNG expects to take delivery of three newbuilding LPG carriers in 2010. Teekay Parent currently owns a 53 percent interest in Teekay LNG (including the two percent General Partner interest). In August 2009, Teekay LNG acquired Teekay Parent's 70 percent interest in two 155,000 cubic meter newbuilding LNG carriers (the Tangguh LNG Carriers). These vessels have commenced their 20 year time-charters to a consortium led by a subsidiary of BP plc to provide transportation services to the Tangguh LNG Project in Indonesia. Cash flow from vessel operations from Teekay LNG during the third quarter of 2009 decreased to $53.9 million from $55.2 million in the same period of the prior year. This decrease was primarily due to the scheduled drydockings of two LNG carriers during the third quarter of 2009, higher vessel operating expenses due to the timing of maintenance expenditures and reduction in revenue relating to a decrease in LIBOR, which affected the daily charter rates that are adjusted for changes in LIBOR under the time-charter contracts for five Suezmax tankers. These decreases were partially offset by the contribution from the first of five Skaugen LPG carriers which delivered in April 2009 and the Tangguh LNG Carriers acquired in August 2009. Teekay Tankers Ltd. Teekay Tankers currently owns a fleet of nine Aframax tankers and three Suezmax tankers. Six of the 12 vessels are currently employed on fixed-rate time charters mostly ranging from one to three years in duration, with the remaining vessels trading in the spot tanker market. Teekay Parent currently owns a 42.2 percent interest in Teekay Tankers (including 100 percent of the Class B common shares). Cash flow from vessel operations from Teekay Tankers decreased to $11.1 million in the third quarter of 2009, from $34.5 million in the same period of the prior year. This decrease was primarily due to a decrease in spot tanker rates in the third quarter of 2009 compared to the same period of the prior year as well as the scheduled drydockings of three Aframax tankers during the third quarter of 2009. Teekay Parent In addition to its equity ownership interests in Teekay Offshore, Teekay LNG and Teekay Tankers, Teekay directly owns a substantial fleet of vessels. As at November 3, 2009, this included 28 conventional tankers (including one Suezmax newbuilding under construction), four FPSOs, a 33 percent interest in four newbuilding LNG carriers under construction, four Aframax shuttle tanker newbuildings under construction, and one FSO unit currently under conversion. In addition, Teekay Parent had 36 chartered-in conventional tankers (including 10 vessels owned by its subsidiaries) and two chartered-in LNG carriers owned by Teekay LNG. Cash flow from vessel operations from Teekay Parent decreased in the third quarter of 2009 by $126.8 million compared to the same period of the prior year, primarily due to a decrease in average spot tanker rates in the third quarter of 2009, partially offset by lower time-charter hire expense and reduced operating and overhead expenses as a result of cost reduction initiatives. Tanker Market Spot tanker rates declined to multi-year lows in the third quarter of 2009 due to the ongoing effects of reduced global oil demand coupled with tanker fleet growth. The tanker market was also affected in the third quarter by a reduction in global refinery throughput due to both scheduled maintenance programs and weaker refinery margins. Seasonal factors such as North Sea oil field maintenance exerted further downward pressure on crude tanker rates. In October 2009, the International Monetary Fund (IMF) upgraded its forecast for global GDP growth in 2010 to 3.1 percent. Several agencies have upgraded their 2010 outlook for global oil demand based on a stronger recovery in the global economy than was previously expected. As of November 12, 2009, the International Energy Agency (IEA) projected global oil demand of 86.2 million barrels per day (mb/d) in 2010, a 1.3 mb/d (or 1.6 percent) increase from 2009. The world tanker fleet grew by approximately 6.5 percent in the first three quarters of 2009 as an influx of new vessels outpaced tanker removals. In recent weeks, there has been an increase in single-hull tanker scrapping ahead of the 2010 International Maritime Organization (IMO) phase-out target with seven Very Large Crude Carriers (VLCCs) sold for scrap since August 2009. An increase in tanker scrapping combined with the potential for order cancellations as a result of tighter credit markets and construction delays at newly established shipyards could help dampen tanker fleet growth in the coming months. Teekay's Spot and Short-Term Time-Charter Tanker Fleet Performance The following table highlights the consolidated operating performance of the Company's conventional spot tanker pools and period out-charters with an initial term of between one and three years, measured in net revenues per revenue day or time-charter equivalent (TCE) rates:
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Three Months Ended
September June 30, September
30, 2009 2009 30, 2008
-------------------------------
Suezmax
Gemini Suezmax Pool average spot TCE
rate(1) $ 14,878 $ 24,633 $ 68,161
Spot revenue days(2) 1,074 713 497
Average time-charter rate(3)(4) $ 35,018 $ 37,486 $ 36,527
Time-charter revenue days 294 568 652
Aframax
Teekay Aframax Pool average spot TCE
rate(1)(5) $ 9,005 $ 16,475 $ 46,419
Spot revenue days(2) 2,473 2,924 3,844
Average time-charter rate(3) $ 32,165 $ 32,708 $ 33,233
Time-charter revenue days 486 546 391
LR2
Taurus LR2 Pool average spot TCE rate(1) $ 15,737 $ 17,721 $ 48,847
Spot revenue days(2) 368 398 503
Average time-charter rate(3) $ 18,500 $ 28,110 $ 36,473
Time-charter revenue days 64 98 182
MR
MR product tanker average spot TCE rate(1) $ 10,548 $ 15,278 $ 30,151
Spot revenue days(2) 272 270 506
Average product tanker time-charter rate(3) $ 24,072 $ 19,645 $ 22,718
Time-charter revenue days 92 167 92
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(1) Average spot rates include short-term time-charters and fixed-rate
contracts of affreightment that are initially under a year in duration
and third-party vessels trading in their respective pools but exclude
vessels greater than 15 years old.
(2) Spot revenue days includes total owned and in-chartered vessels in the
Teekay consolidated fleet but excludes commercially managed pool
vessels.
(3) Average time-charter rates include realized gains and losses of
synthetic time-charters and forward freight agreements (FFAs), short-
term time-charters, and fixed-rate contracts of affreightment that are
initially between one and three years in duration.
(4) Average Suezmax time-charter rates exclude the cost of spot in-
chartering vessels for contract of affreightment cargoes.
(5) Including items outside of the pool (vessels greater than 15 years old
and realized results of bunker hedging and FFAs) the average Teekay
Aframax spot TCE rate was $10,185 per day, $16,425 per day and $44,673
per day during the three months ended September 30, 2009, June 30, 2009
and September 30, 2008, respectively.
Fleet List As at November 3, 2009, Teekay's consolidated fleet consisted of 161 vessels, including chartered-in vessels, newbuildings under construction and vessels under conversion but excluding vessels managed for third parties, as summarized in the following table:
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Number of Vessels(1)
------------------------------------------
Owned Chartered-in Newbuildings/
Vessels Vessels Conversions Total
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Teekay Offshore Fleet
Shuttle Tankers(2) 27 9 - 36
FSO Units(3) 5 - - 5
FPSO Unit 1 - - 1
Aframax Tankers 11 - - 11
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Total Teekay Offshore Fleet 44 9 - 53
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Teekay LNG Fleet
LNG Carriers 15 - - 15
LPG Carriers 3 - 3 6
Suezmax Tankers 8 - - 8
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Total Teekay LNG Fleet 26 - 3 29
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Teekay Tankers Fleet
Aframax Tankers 9 - - 9
Suezmax Tankers 3 - - 3
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Total Teekay Tankers Fleet 12 - - 12
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Teekay Parent Fleet
Aframax Tankers(4) 7 17 - 24
Suezmax Tankers 12 6 1 19
VLCC Tankers - 1 - 1
Product Tankers 8 2 - 10
LNG Carriers(5) - - 4 4
Shuttle Tankers - - 4 4
FPSO Units 4 - - 4
FSO Units - - 1 1
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Total Teekay Parent Fleet 31 26 10 67
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Total Teekay Consolidated Fleet 113 35 13 161
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(1) Excludes vessels managed on behalf of third parties.
(2) Includes six shuttle tankers in which Teekay Offshore's ownership is 50
percent.
(3) Includes one FSO in which Teekay Offshore's ownership is 89 percent.
(4) Excludes nine vessels chartered-in from Teekay Offshore Partners and
one vessel chartered-in from Teekay Tankers.
(5) Excludes two LNG carriers chartered-in from Teekay LNG.
In July 2009, Teekay Parent entered into an agreement to sell one of its older Aframax tankers for $16.4 million. The vessel is expected to be delivered in mid-November 2009. In August 2009, Teekay Parent entered into an agreement to purchase a 2007-built 40,000 deadweight tonne product tanker, which delivered in September 2009 and commenced a 10-year fixed-rate charter with Caltex Australia. In September 2009, Teekay Parent entered into an agreement to sell one of its older product tankers for $4.6 million and the vessel was delivered in mid-October 2009. Liquidity and Capital Expenditures As at September 30, 2009, Teekay had current consolidated liquidity of $1.8 billion, consisting of $495.4 million cash and $1,272.1 million of undrawn revolving credit facilities. Including the new $260 million Petrojarl Varg FPSO revolving credit facility signed on November 12, 2009, the Company's current consolidated liquidity is $2.0 billion. In addition, the Company has pre-arranged newbuilding financing of $733 million, bringing the total consolidated liquidity to approximately $2.8 billion. The Company's remaining capital commitments relating to its portion of newbuildings were as follows as at September 30, 2009: --------------------------------------------------------------------------- (in millions) 2009 2010 2011 2012 Total --------------------------------------------------------------------------- Teekay Offshore - - - - - --------------------------------------------------------------------------- Teekay LNG $ 43 $ 61 - - $104 --------------------------------------------------------------------------- Teekay Tankers - - - - - --------------------------------------------------------------------------- Teekay Parent - $293 $309 $ 45 $647 --------------------------------------------------------------------------- Total Teekay Corporation Consolidated $ 43 $354 $309 $ 45 $751 --------------------------------------------------------------------------- As indicated above, the Company had total capital expenditure commitments of approximately $751 million remaining as at September 30, 2009, of which $733 million has pre-arranged financing, leaving only $18 million to be funded from operating cash flow or other sources. 2008 Annual Results Teekay's annual results on Form 20-F for the year ended December 31, 2008, as filed with the United States Securities and Exchange Commission (SEC), can be found on the Company's Web site www.teekay.com or alternatively can be requested free of charge by contacting Teekay Investor Relations. About Teekay Teekay Corporation transports more than 10 percent of the world's seaborne oil, has built a significant presence in the liquefied natural gas shipping sector through its publicly-listed subsidiary, Teekay LNG Partners L.P. (NYSE:TGP - News), is further growing its operations in the offshore oil production, storage and transportation sector through its publicly-listed subsidiary, Teekay Offshore Partners L.P. (NYSE:TOO - News), and continues to expand its conventional tanker business through its publicly-listed subsidiary, Teekay Tankers Ltd. (NYSE:TNK - News). With a fleet of over 160 vessels, offices in 16 countries and approximately 6,700 seagoing and shore-based employees, Teekay provides a comprehensive set of marine services to the world's leading oil and gas companies, helping them seamlessly link their upstream energy production to their downstream processing operations. Teekay's 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 INCOME (LOSS)
(in thousands of U.S. dollars, except share and per share data)
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Three Months Ended Nine Months Ended
September June 30, September September September
30, 2009 2009 30, 2008 30, 2009 30, 2008
(unaudited) (unaudited) (unaudited) (unaudited) (unaudited)
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REVENUES(1) 500,368 532,473 880,876 1,649,392 2,432,123
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OPERATING
EXPENSES
Voyage expenses
(1) 71,659 62,925 213,709 225,253 572,685
Vessel operating
expenses(1)(2) 147,442 140,529 160,138 437,299 469,517
Time-charter hire
expense 94,964 116,451 157,822 348,243 445,444
Depreciation and
amortization 107,111 108,192 108,493 321,856 312,900
General and
administrative
(1)(2) 52,238 52,695 44,372 156,073 184,735
Loss (gain) on
sale of vessels
and equipment,
net of
write-downs 915 (11,083) (36,292) (10,286) (39,713)
Restructuring
charges 1,456 5,003 5,063 12,017 11,180
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475,785 474,712 653,305 1,490,455 1,956,748
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Income from
vessel
operations 24,583 57,761 227,571 158,937 475,375
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OTHER ITEMS
Interest expense
(1) (30,035) (37,280) (63,180) (111,505) (215,139)
Interest income
(1) 4,193 5,023 20,686 15,894 73,408
Realized and
unrealized
(loss) gain
on derivative
instruments(1) (121,664) 157,485 (90,594) 83,066 (125,542)
Income tax
(expense)
recovery (10,904) 4,598 26,304 (12,174) 35,022
Equity (loss)
income from
joint
ventures(1) (8,945) 27,380 (5,108) 29,857 (10,780)
Foreign exchange
(loss) gain (26,047) (25,165) 44,918 (39,900) 8,323
Other income
(loss) - net 2,938 3,823 (18,144) 8,343 (7,662)
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Net (loss) income
(3) (165,881) 193,625 142,453 132,518 233,005
Less: Net loss
(income)
attributable
to
non-controlling
interests 23,633 (34,266) (39,325) (33,902) (51,587)
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Net (loss) income
attributable to
stockholders of
Teekay
Corporation (142,248) 159,359 103,128 98,616 181,418
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(Loss) earnings
per common share
of Teekay
- Basic $ (1.96) $ 2.20 $ 1.42 $ 1.36 $ 2.50
- Diluted $ (1.96) $ 2.19 $ 1.41 $ 1.35 $ 2.48
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Weighted-average
number of
common shares
outstanding
- Basic 72,553,809 72,535,899 72,467,924 72,535,438 72,496,564
- Diluted 72,553,809 72,798,023 73,033,603 72,876,558 73,248,540
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(1) Commencing in 2009 and applied retroactively, the realized and
unrealized gains and losses related to derivative instruments that are
not designated as hedges for accounting purposes have been reclassified
to a separate line item in the statements of income. 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 Ended Nine Months Ended
September June 30, September September September
30, 2009 2009 30, 2008 30, 2009 30, 2008
--------- --------- --------- --------- ---------
Realized (losses)
gains relating to:
Interest rate
swaps (41,321) (29,528) (15,150) (91,737) (28,361)
Foreign currency
forward contracts
Vessel operating
expenses (926) (2,407) 4,286 (6,770) 14,976
General and
administrative
expenses (55) (41) 2,514 (2,156) 9,656
Voyage expenses
and other - - 419 - 5,767
Bunkers and FFAs 2,655 4,294 (9,598) 4,660 (25,348)
--------------------------------------------------------
(39,647) (27,682) (17,529) (96,003) (23,310)
--------------------------------------------------------
Unrealized (losses)
gains relating to:
Interest rate
swaps (81,114) 182,471 (58,102) 164,333 (55,480)
Foreign currency
forward contracts 2,060 6,416 (23,749) 15,227 (31,975)
Bunkers, FFAs and
other (2,963) (3,720) 8,786 (491) (14,777)
--------------------------------------------------------
(82,017) 185,167 (73,065) 179,069 (102,232)
--------------------------------------------------------
Total realized and
unrealized (losses)
gains on non-
designated
derivative
instruments (121,664) 157,485 (90,594) 83,066 (125,542)
--------------------------------------------------------
--------------------------------------------------------
In addition, equity income (loss) from joint ventures includes net
unrealized gains (losses) from non-designated interest rate swaps held
within the joint ventures of $(10.2) million, $25.5 million and $(2.6)
million for the three months ended September 30, 2009, June 30, 2009 and
September 30, 2008, respectively, and $23.1 million and $(2.6) million for
the nine months ended September 30, 2009 and 2008, respectively.
(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 United States GAAP.
Unrealized gains arising from hedge ineffectiveness from such forward
contracts are reflected in vessel operating expenses and general and
administrative expenses in the above Statements of Income (Loss), as
detailed in the table below:
Three Months Ended Nine Months Ended
September June 30, September September September
30, 2009 2009 30, 2008 30, 2009 30, 2008
--------- --------- --------- --------- ---------
Vessel operating
expenses 2,979 6,919 4,151 9,675 3,961
General and
administrative 2,615 1,692 1,512 6,304 1,397
(3) Commencing in 2009 and applied retroactively, the Company's net income
(loss) includes income attributable to non-controlling interests.
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TEEKAY CORPORATION
SUMMARY CONSOLIDATED BALANCE SHEETS
(in thousands of U.S. dollars)
---------------------------------------------------------------------------
As at As at As at
September 30, June 30, December 31,
2009 2009 2008
(unaudited) (unaudited) (unaudited)
--------- --------- ---------
ASSETS
Cash and cash equivalents 495,402 472,671 814,165
Other current assets 301,147 302,712 438,829
Restricted cash - current 37,845 35,440 35,841
Restricted cash - long-term 615,093 610,523 614,715
Vessels held for sale 34,637 34,970 69,649
Vessels and equipment 6,694,688 6,649,736 6,713,392
Advances on newbuilding contracts 196,080 231,220 553,702
Derivative assets 85,006 53,904 167,326
Investment in joint ventures 117,204 126,315 103,956
Investment in direct financing leases 481,489 474,321 79,508
Other assets 162,059 159,076 155,959
Intangible assets 238,392 246,640 264,768
Goodwill 203,191 203,191 203,191
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Total Assets 9,662,233 9,600,719 10,215,001
---------------------------------------------------------------------------
---------------------------------------------------------------------------
LIABILITIES AND EQUITY
Accounts payable and accrued liabilities 331,657 289,836 371,084
Other current liabilities 1,990 21,274 22,255
Current portion of long-term debt 351,792 353,834 392,659
Long-term debt 4,991,302 4,943,490 5,377,474
Derivative liabilities 497,907 417,668 843,265
In process revenue contracts 264,237 283,362 317,865
Other long-term liabilities 267,764 257,902 237,994
Equity:
Non-controlling interests 757,167 727,390 583,938
Stockholders of Teekay 2,198,417 2,305,963 2,068,467
---------------------------------------------------------------------------
Total Liabilities and Equity 9,662,233 9,600,719 10,215,001
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
TEEKAY CORPORATION
SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands of U.S. dollars)
---------------------------------------------------------------------------
Nine Months Ended
September 30,
2009 2008
(unaudited) (unaudited)
--------- ---------
Cash and cash equivalents provided by (used for)
OPERATING ACTIVITIES
---------------------------------------------------------------------------
Net operating cash flow 298,300 317,315
---------------------------------------------------------------------------
FINANCING ACTIVITIES
Net proceeds from long-term debt 759,451 1,976,967
Scheduled repayments of long-term debt (143,873) (243,427)
Prepayments of long-term debt (1,104,204) (881,993)
Decrease (increase) in restricted cash 5,228 (56,924)
Repurchase of common stock - (20,512)
Net proceeds from the public offering of Teekay LNG 67,095 148,331
Net proceeds from the public offering of Teekay
Offshore 102,098 142,160
Net proceeds from the public offering of Teekay
Tankers 65,556 -
Cash dividends paid (68,800) (59,952)
Distribution from subsidiaries to non-controlling
interests (83,646) (61,616)
Other 352 2,764
---------------------------------------------------------------------------
Net financing cash flow (400,743) 945,798
---------------------------------------------------------------------------
INVESTING ACTIVITIES
Expenditures for vessels and equipment (431,607) (546,334)
Proceeds from sale of vessels and equipment 198,837 184,338
Purchase of marketable securities - (542)
Proceeds from sale of marketable securities - 11,058
Purchase of Teekay Petrojarl ASA - (258,555)
Loans to joint ventures (1,206) (255,971)
Other 17,656 35,833
---------------------------------------------------------------------------
Net investing cash flow (216,320) (830,173)
---------------------------------------------------------------------------
(Decrease) increase in cash and cash equivalents (318,763) 432,940
Cash and cash equivalents, beginning of the period 814,165 442,673
---------------------------------------------------------------------------
Cash and cash equivalents, end of the period 495,402 875,613
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX A - SPECIFIC ITEMS AFFECTING NET (LOSS) INCOME
(in thousands of U.S. dollars, except per share data)
Set forth below is a reconciliation of the Company's unaudited adjusted net
loss, a non-GAAP financial measure, to net (loss) income as determined in
accordance with GAAP, adjusted for some of the significant items of income
and expense that affected the Company's net (loss) income for the three and
nine months ended September 30, 2009, all of which items are typically
excluded by securities analysts in their published estimates of the
Company's financial results:
---------------------------------------------------------------------------
Three Months Ended Nine Months Ended
September 30, 2009 September 30, 2009
------------------ ------------------
(unaudited) (unaudited)
$ Per $ Per
$ Share(1) $ Share(1)
---------------------------------------------------------------------------
Net (loss) income - GAAP basis (165,881) 132,518
Adjust for: Net loss (income)
attributable to non-controlling
interests 23,633 (33,902)
---------------------------------------------------------------------------
Net (loss) income attributable to
stockholders of Teekay (142,248) (1.96) 98,616 1.35
Add (subtract) specific items affecting
net (loss) income:
Unrealized losses (gains) from
derivative instruments(2) 86,620 1.19 (218,121) (2.99)
Foreign currency exchange losses(3) 26,047 0.36 39,900 0.55
Deferred income tax expense on
unrealized foreign exchange gains(4) 14,586 0.20 24,854 0.34
Restructuring charge(5) 1,456 0.02 12,017 0.17
Loss (gains) on sale of vessels and
equipment 235 0.01 (29,728) (0.41)
Write-down of vessels and equipment 680 0.01 19,442 0.27
Realized losses on early termination
of interest rate swap agreements 6,819 0.09 6,819 0.09
Other(6) 1,763 0.02 2,634 0.04
Non-controlling interests' share of
items above (39,318) (0.54) (10,660) (0.15)
---------------------------------------------------------------------------
Total adjustments 98,888 1.36 (152,843) (2.09)
---------------------------------------------------------------------------
Adjusted net loss attributable to
stockholders of Teekay (43,360) (0.60) (54,227) (0.74)
---------------------------------------------------------------------------
---------------------------------------------------------------------------
(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 losses primarily relate to the Company's debt
denominated in Euros and deferred tax liability denominated in Norwegian
Kroner. Nearly all of the Company's foreign currency exchange gains and
losses are unrealized.
(4) Primarily due to deferred income tax related to unrealized foreign
exchange gains and losses.
(5) Restructuring charges relate to the reorganization of certain of the
Company's operational functions and the re-flagging of certain of the
Company's shuttle tankers.
(6) Primarily relates to non-recurring adjustments to tax accruals and
impairment of intangible assets.
---------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX A - SPECIFIC ITEMS AFFECTING NET INCOME
(in thousands of U.S. dollars, except per share data)
Set forth below is a reconciliation of the Company's unaudited adjusted net
income, a non-GAAP financial measure, to net income as determined in
accordance with GAAP, adjusted for some of the significant items of income
and expense that affected the Company's net income for the three and nine
months ended September 30, 2008, all of which items are typically excluded
by securities analysts in their published estimates of the Company's
financial results:
---------------------------------------------------------------------------
Three Months Ended Nine Months Ended
September 30, 2008 September 30, 2008
------------------ ------------------
(unaudited) (unaudited)
$ Per $ Per
$ Share(1) $ Share(1)
---------------------------------------------------------------------------
Net income - GAAP basis 142,453 233,005
Adjust for: Net income attributable to
non-controlling interests (39,325) (51,587)
---------------------------------------------------------------------------
Net income attributable to stockholders
of Teekay 103,128 1.41 181,418 2.48
Add (subtract) specific items affecting
net income:
Unrealized losses from derivative
instruments(2) 70,161 0.97 85,719 1.17
Foreign currency exchange gains(3) (43,857) (0.60) (8,518) (0.12)
Deferred income tax expense on
unrealized foreign exchange losses(4) (16,842) (0.23) (8,162) (0.11)
Restructuring charge(5) 5,063 0.07 9,680 0.13
Gain on sale of vessels and equipment (36,292) (0.50) (39,713) (0.54)
Net effect from non-cash changes in
purchase price allocation for the
acquisition of 50 percent of
OMI Corporation(6) 1,364 0.02 8,392 0.11
Net effect from non-cash changes in
purchase price allocation for the
acquisition of Teekay Petrojarl ASA(7) - - 6,398 0.09
Change in long-term incentive plan
accruals(8) (20,231) (0.28) (22,606) (0.31)
Write-down of marketable securities 13,885 0.19 13,885 0.19
Other(9) 4,774 0.06 7,984 0.11
Non-controlling interests' share of
items above 13,109 0.18 (2,393) (0.03)
---------------------------------------------------------------------------
Total adjustments (8,866) (0.12) 50,666 0.69
---------------------------------------------------------------------------
Adjusted net income attributable to
stockholders of Teekay 94,262 1.29 232,084 3.17
---------------------------------------------------------------------------
---------------------------------------------------------------------------
(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 primarily relate to the Company's debt
denominated in Euros and deferred tax liability denominated in Norwegian
Kroner. Nearly all of the Company's foreign currency exchange gains and
losses are unrealized.
(4) Primarily due to deferred income tax related to unrealized foreign
exchange gains and losses.
(5) Restructuring charges relate to the reorganization of certain of the
Company's operational functions.
(6) Primarily relates to changes in amortization of intangible assets as a
result of adjustments to the purchase price allocation of OMI
Corporation.
(7) Primarily relates to changes in amortization of in-process revenue
contracts as a result of adjustments to the purchase price allocation
of Teekay Petrojarl ASA.
(8) Relates to changes in accruals relating to the Company's long-term
incentive plan which is linked to the Company's share price. Amounts
are included in general and administrative expenses.
(9) Primarily relates to losses on bond repurchases (8.875% Notes due
2011), a change in non-cash deferred tax balances, settlement of a
previous claim against OMI Corporation and goodwill impairment.
---------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY BALANCE SHEET AS AT SEPTEMBER 30, 2009
(in thousands of U.S. dollars)
---------------------------------------------------------------------------
(unaudited)
Teekay Teekay Teekay Teekay
Offshore LNG Tankers Petrojarl
-------------------------------------
ASSETS
Cash and cash equivalents 143,746 90,485 13,396 59,101
Other current assets 84,609 17,234 5,564 45,646
Restricted cash (current &
non-current) - 650,517 - 2,024
Vessels and equipment 1,952,912 1,793,551 511,942 929,589
Advances on newbuilding contracts - 56,421 - -
Derivative assets 6,052 71,976 - 4,012
Investment in joint ventures - 75,624 - -
Investment in direct financing leases 61,638 419,249 - -
Other assets 14,585 24,795 4,246 17,371
Advances to affiliates 13,155 11,926 766 -
Equity investment in subsidiaries - - - -
Intangibles and goodwill 165,887 170,589 6,761 999
-------------------------------------
TOTAL ASSETS 2,442,584 3,382,367 542,675 1,058,742
-------------------------------------
-------------------------------------
LIABILITIES AND EQUITY
Accounts payable and accrued
liabilities 71,285 54,785 13,858 38,743
Other current liabilities 754 1,236 - -
Advances from affiliates 257,632 99,387 1,462 37,901
Current portion of long-term debt 77,322 218,111 3,600 12,100
Long-term debt 1,474,116 2,013,274 302,528 93,634
Derivative liabilities 96,324 183,246 17,269 24,256
In-process revenue contracts - - 739 262,191
Other long-term liabilities 47,535 55,097 - 43,500
Equity:
Non-controlling interests(1) 42,477 1,543 - 665
Equity attributable to stockholders/
unitholders of publicly-listed
entities 375,139 755,688 203,219 545,752
-------------------------------------
TOTAL LIABILITIES AND EQUITY 2,442,584 3,382,367 542,675 1,058,742
-------------------------------------
-------------------------------------
NET DEBT(2) 1,407,692 1,490,383 292,732 44,609
-------------------------------------
-------------------------------------
Teekay Consolidation
Standalone Adjustments Total
-----------------------------------
ASSETS
Cash and cash equivalents 188,674 - 495,402
Other current assets 182,731 - 335,784
Restricted cash (current &
non-current) 397 - 652,938
Vessels and equipment 1,506,694 - 6,694,688
Advances on newbuilding contracts 139,659 - 196,080
Derivative assets 2,966 - 85,006
Investment in joint ventures 41,580 - 117,204
Investment in direct financing leases 602 - 481,489
Other assets 101,062 - 162,059
Advances to affiliates (25,847) - -
Equity investment in subsidiaries 1,167,316 (1,167,316) -
Intangibles and goodwill 97,347 - 441,583
-----------------------------------
TOTAL ASSETS 3,403,181 (1,167,316) 9,662,233
-----------------------------------
-----------------------------------
LIABILITIES AND EQUITY
Accounts payable and accrued
liabilities 152,986 - 331,657
Other current liabilities - - 1,990
Advances from affiliates (396,382) - -
Current portion of long-term debt 40,659 - 351,792
Long-term debt 1,107,750 - 4,991,302
Derivative liabilities 176,812 - 497,907
In-process revenue contracts 1,307 - 264,237
Other long-term liabilities 121,632 - 267,764
Equity:
Non-controlling interests(1) - 712,482 757,167
Equity attributable to stockholders/
unitholders of publicly-listed
entities 2,198,417 (1,879,798) 2,198,417
-----------------------------------
TOTAL LIABILITIES AND EQUITY 3,403,181 (1,167,316) 9,662,233
-----------------------------------
-----------------------------------
NET DEBT(2) 959,338 - 4,194,754
-----------------------------------
-----------------------------------
(1) Non-controlling interests in the Teekay Offshore and Teekay LNG
columns represent the joint venture partners' share of the 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.
Commencing in 2009, non-controlling interest is included as a
component of equity.
(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 STATEMENTS OF (LOSS) INCOME FOR THE THREE MONTHS ENDED
SEPTEMBER 30, 2009
(in thousands of U.S. dollars)
---------------------------------------------------------------------------
(unaudited)
Teekay Teekay Teekay Teekay
Offshore LNG Tankers Petrojarl
------------------------------------
Voyage revenues 206,938 79,783 21,899 72,392
------------------------------------
Voyage expenses 30,263 743 1,288 -
Vessel operating expenses 54,857 19,126 7,677 37,027
Time-charter hire expense 27,772 - - 5,753
Depreciation and amortization 40,981 18,901 6,906 19,711
General and administrative 13,820 4,952 1,814 8,024
Loss on sale of vessels and
equipment, net of write-downs - - - -
Restructuring charge 371 393 - -
------------------------------------
Total operating expenses 168,064 44,115 17,685 70,515
------------------------------------
Income (loss) from vessel operations 38,874 35,668 4,214 1,877
------------------------------------
Net interest expense (9,035) (10,021) (1,143) (260)
Realized and unrealized loss on
derivative instruments (37,302) (33,882) (4,564) (4,555)
Income tax (expense) recovery (13,804) 144 - (175)
Equity loss from joint ventures - (2,499) - (759)
Equity in earnings of subsidiaries(1) - - - -
Foreign exchange loss (4,485) (17,559) (24) (436)
Other - net 2,068 (83) - (69)
------------------------------------
Net (loss) income (23,684) (28,232) (1,517) (4,377)
Less: Net loss (income) attributable
to non-controlling interests(2) (143) 2,511 - 49
------------------------------------
Net (loss) income attributable to
stockholders/unitholders of publicly
listed entities (23,827) (25,721) (1,517) (4,328)
------------------------------------
------------------------------------
------------------------------------
CASH FLOW FROM VESSEL OPERATIONS(3) 63,796 53,928 11,120 15,391
------------------------------------
------------------------------------
Teekay Consolidation
Standalone Adjustments Total
----------------------------------
Voyage revenues 168,674 (49,318) 500,368
----------------------------------
Voyage expenses 45,976 (6,611) 71,659
Vessel operating expenses 28,755 - 147,442
Time-charter hire expense 104,146 (42,707) 94,964
Depreciation and amortization 20,612 - 107,111
General and administrative 23,628 - 52,238
Loss on sale of vessels and
equipment, net of
write-downs 915 - 915
Restructuring charge 692 - 1,456
----------------------------------
Total operating expenses 224,724 (49,318) 475,785
----------------------------------
Income (loss) from vessel operations (56,050) - 24,583
----------------------------------
Net interest expense (5,383) - (25,842)
Realized and unrealized loss on
derivative instruments (41,361) - (121,664)
Income tax (expense) recovery 2,931 - (10,904)
Equity loss from joint ventures (5,687) - (8,945)
Equity in earnings of subsidiaries(1) (23,983) 23,983 -
Foreign exchange loss (3,543) - (26,047)
Other - net 1,022 - 2,938
----------------------------------
Net (loss) income (132,054) 23,983 (165,881)
Less: Net loss (income) attributable
to non-controlling interests(2) - 21,216 23,633
----------------------------------
Net (loss) income attributable to
stockholders/unitholders of publicly
listed entities (132,054) 45,199 (142,248)
----------------------------------
----------------------------------
----------------------------------
CASH FLOW FROM VESSEL OPERATIONS(3) (32,257) - 111,978
----------------------------------
----------------------------------
(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.
Commencing in 2009, the Company's net income (loss) includes income
(loss) attributable to non-controlling interests.
(3) 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 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. 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.
---------------------------------------------------------------------------
TEEKAY CORPORATION
APPENDIX B - SUPPLEMENTAL FINANCIAL INFORMATION
SUMMARY STATEMENTS OF INCOME FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2009
(in thousands of U.S. dollars)
---------------------------------------------------------------------------
(unaudited)
Teekay Teekay Teekay Teekay
Offshore LNG Tankers Petrojarl
-------------------------------------
Voyage revenues 608,460 235,580 87,352 220,211
-------------------------------------
Voyage expenses 77,305 1,483 2,382 -
Vessel operating expenses 171,619 56,045 23,977 105,617
Time-charter hire expense 89,061 - - 17,358
Depreciation and amortization 121,366 58,387 21,167 59,970
General and administrative 42,140 12,563 5,239 22,316
Gain on sale of vessels and
equipment, net of write-downs - - - -
Restructuring charge 4,053 3,053 - -
-------------------------------------
Total operating expenses 505,544 131,531 52,765 205,261
-------------------------------------
Income (loss) from vessel operations 102,916 104,049 34,587 14,950
-------------------------------------
Net interest expense (31,859) (35,772) (5,797) (5,429)
Realized and unrealized gain (loss)
on derivative instruments 37,716 (41,476) 2,279 (3,271)
Income tax (expense) recovery (14,905) 443 - (452)
Equity income (loss) from joint
ventures - 11,507 - (1,771)
Equity in earnings of subsidiaries(1) - - - -
Foreign exchange loss (8,400) (19,510) (51) (4,999)
Other - net 7,055 (204) - (167)
-------------------------------------
Net income (loss) 92,523 19,037 31,018 (1,139)
Less: Net (income) loss attributable
to non-controlling interests(2) (5,593) 1,408 - 163
-------------------------------------
Net income (loss) attributable to
stockholders/unitholders of publicly
listed entities 86,930 20,445 31,018 (976)
-------------------------------------
-------------------------------------
-------------------------------------
CASH FLOW FROM VESSEL OPERATIONS(3) 179,091 156,052 50,642 52,032
-------------------------------------
-------------------------------------
Teekay Consolidation
Standalone Adjustments Total
-----------------------------------
Voyage revenues 648,433 (150,644) 1,649,392
-----------------------------------
Voyage expenses 163,161 (19,078) 225,253
Vessel operating expenses 80,041 - 437,299
Time-charter hire expense 373,390 (131,566) 348,243
Depreciation and amortization 60,966 - 321,856
General and administrative 73,815 - 156,073
Gain on sale of vessels and
equipment, net of write-downs (10,286) - (10,286)
Restructuring charge 4,911 - 12,017
-----------------------------------
Total operating expenses 745,998 (150,644) 1,490,455
-----------------------------------
Income (loss) from vessel operations (97,565) - 158,937
-----------------------------------
Net interest expense (16,754) - (95,611)
Realized and unrealized gain (loss)
on derivative instruments 87,818 - 83,066
Income tax (expense) recovery 2,740 - (12,174)
Equity income (loss) from joint
ventures 20,121 - 29,857
Equity in earnings of subsidiaries(1) 107,729 (107,729) -
Foreign exchange loss (6,940) - (39,900)
Other - net 1,659 - 8,343
-----------------------------------
Net income (loss) 98,808 (107,729) 132,518
Less: Net (income) loss attributable
to non-controlling interests(2) - (29,880) (33,902)
-----------------------------------
Net income (loss) attributable to
stockholders/unitholders of publicly
listed entities 98,808 (137,609) 98,616
-----------------------------------
-----------------------------------
-----------------------------------
CASH FLOW FROM VESSEL OPERATIONS(3) (40,987) - 396,830
-----------------------------------
-----------------------------------
(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.
Commencing in 2009, the Company's net income (loss) includes income
(loss) attributable to non-controlling interests.
(3) 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 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. 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.
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: tanker market fundamentals, including the balance of supply and demand in the tanker market, and spot tanker charter rates; the Company's financial strength, including the stability of its cash flows, the proportion of its total cash flows contributed from its fixed-rate businesses, its liquidity position, and debt maturity profile; the Company's future capital expenditure commitments and the financing requirements for such commitments; the impact on the Company's profitability through cost reductions and charter contract improvements; the impact on the Company's financial leverage and flexibility resulting from its strategy of selling assets to its subsidiary companies, Teekay LNG, Teekay Offshore and Teekay Tankers; and the expected benefit from future investment opportunities. 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; the potential for early termination of long-term contracts and inability of the Company to renew or replace long-term contracts; changes affecting the offshore tanker market; shipyard production delays; changes in the Company's expenses; the Company's future capital expenditure requirements; the inability of the Company to complete vessel sale transactions to its daughters or third parties; 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, 2008. 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. Contact:
Source: Teekay Corporation
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