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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Teekay Tankers Ltd | NYSE:TNK | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
-0.07 | -0.12% | 58.53 | 59.14 | 58.34 | 58.71 | 15,388 | 15:09:22 |
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PAGE
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|
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Item 1.
|
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|
|
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|
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|
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|
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Item 2.
|
||
Item 3.
|
||
|
|
Three Months Ended
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
Nine Months Ended
|
|
||||
|
|
September 30, 2016
|
|
September 30, 2015
|
|
September 30, 2016
|
|
September 30, 2015
|
|
||||
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||
REVENUES
|
|
|
|
|
|
|
|
||||||
Net pool revenues
(note 12a)
|
|
49,174
|
|
|
92,022
|
|
|
250,426
|
|
|
263,510
|
|
|
Time charter revenues
(note 12a)
|
|
23,276
|
|
|
20,339
|
|
|
68,884
|
|
|
48,387
|
|
|
Voyage charter revenues
|
|
23,176
|
|
|
5,502
|
|
|
59,750
|
|
|
20,327
|
|
|
Other revenues
(notes 6 and 16)
|
|
8,995
|
|
|
8,538
|
|
|
30,132
|
|
|
12,983
|
|
|
Total revenues
|
|
104,621
|
|
|
126,401
|
|
|
409,192
|
|
|
345,207
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Voyage expenses
(note 12a)
|
|
(14,933
|
)
|
|
(2,653
|
)
|
|
(37,514
|
)
|
|
(10,164
|
)
|
|
Vessel operating expenses
(note 12a)
|
|
(44,783
|
)
|
|
(35,267
|
)
|
|
(136,245
|
)
|
|
(87,085
|
)
|
|
Time-charter hire expense
|
|
(11,335
|
)
|
|
(21,382
|
)
|
|
(47,964
|
)
|
|
(53,178
|
)
|
|
Depreciation and amortization
|
|
(25,888
|
)
|
|
(17,878
|
)
|
|
(78,576
|
)
|
|
(48,346
|
)
|
|
General and administrative
expenses
(note 12a)
|
|
(3,572
|
)
|
|
(4,310
|
)
|
|
(13,774
|
)
|
|
(10,992
|
)
|
|
Loss on sale of vessel
|
|
(137
|
)
|
|
—
|
|
|
(137
|
)
|
|
—
|
|
|
Asset impairments
(note 13)
|
|
(7,766
|
)
|
|
—
|
|
|
(14,186
|
)
|
|
—
|
|
|
Restructuring charges
(note 16)
|
|
—
|
|
|
(327
|
)
|
|
—
|
|
|
(4,772
|
)
|
|
(Loss) income from operations
|
|
(3,793
|
)
|
|
44,584
|
|
|
80,796
|
|
|
130,670
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest expense
|
|
(6,809
|
)
|
|
(4,008
|
)
|
|
(22,421
|
)
|
|
(9,659
|
)
|
|
Interest income
|
|
18
|
|
|
28
|
|
|
70
|
|
|
67
|
|
|
Realized and unrealized gain (loss) on derivative instruments
(note 8)
|
|
3,629
|
|
|
(1,031
|
)
|
|
(7,902
|
)
|
|
(2,095
|
)
|
|
Equity income
(note 5)
|
|
1,045
|
|
|
2,762
|
|
|
9,599
|
|
|
8,931
|
|
|
Other income (expense)
(note 9)
|
|
453
|
|
|
(1,385
|
)
|
|
(4,133
|
)
|
|
(1,838
|
)
|
|
Net (loss) income
|
|
(5,457
|
)
|
|
40,950
|
|
|
56,009
|
|
|
126,076
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Per common share amounts
(note 14)
|
|
|
|
|
|
|
|
|
|
||||
- Basic (loss) income per share
|
|
(0.03
|
)
|
|
0.31
|
|
|
0.36
|
|
|
1.02
|
|
|
- Diluted (loss) income per share
|
|
(0.03
|
)
|
|
0.30
|
|
|
0.36
|
|
|
1.02
|
|
|
- Cash dividends declared
|
|
0.06
|
|
|
0.03
|
|
|
0.15
|
|
|
0.09
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted-average number of Class A and Class B common stock outstanding
(note 14)
|
|
|
|
|
|
|
|
|
|
||||
- Basic
|
|
156,284,136
|
|
134,630,768
|
|
156,192,572
|
|
121,933,274
|
|
||||
- Diluted
|
|
156,284,136
|
|
135,174,756
|
|
156,458,691
|
|
122,504,070
|
|
||||
Related party transactions
(note 12)
|
|
|
|
|
|
|
|
|
|
|
|
As at
|
|
As at
|
||
|
|
September 30, 2016
|
|
December 31, 2015
|
||
|
|
$
|
|
$
|
||
ASSETS
|
|
|
||||
Current
|
|
|
||||
Cash and cash equivalents
|
|
59,237
|
|
|
96,417
|
|
Restricted cash
|
|
1,000
|
|
|
870
|
|
Pool receivable from affiliates, net
(note 12b)
|
|
14,073
|
|
|
62,735
|
|
Accounts receivable
|
|
25,245
|
|
|
28,313
|
|
Vessel held for sale
(note 13)
|
|
13,151
|
|
|
—
|
|
Due from affiliates
(note 12b)
|
|
52,501
|
|
|
67,159
|
|
Current portion of derivative assets
(note 8)
|
|
1,554
|
|
|
—
|
|
Prepaid expenses
|
|
20,053
|
|
|
24,320
|
|
Total current assets
|
|
186,814
|
|
|
279,814
|
|
Vessels and equipment
|
|
|
|
|
||
At cost, less accumulated depreciation of $449.6 million (2015 - $391.0 million)
|
|
1,664,859
|
|
|
1,767,925
|
|
Investment in and advances to equity accounted investments
(note 5)
|
|
78,771
|
|
|
86,808
|
|
Derivative asset
s (note 8
)
|
|
717
|
|
|
5,164
|
|
Intangible assets - net
(note 17)
|
|
18,491
|
|
|
29,619
|
|
Goodwill
(note 17)
|
|
8,059
|
|
|
—
|
|
Other non-current assets
|
|
73
|
|
|
146
|
|
Total assets
|
|
1,957,784
|
|
|
2,169,476
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
||
Current
|
|
|
|
|
||
Accounts payable
|
|
9,858
|
|
|
16,717
|
|
Accrued liabilities
|
|
26,259
|
|
|
62,029
|
|
Current portion of long-term debt
(note 7)
|
|
155,690
|
|
|
174,047
|
|
Current portion of derivative liabilities
(note 8)
|
|
1,861
|
|
|
6,330
|
|
Current portion of in-process revenue contracts
(notes 6 and 16)
|
|
—
|
|
|
1,223
|
|
Deferred revenue
|
|
1,955
|
|
|
2,676
|
|
Due to affiliates
(note 12b)
|
|
26,470
|
|
|
26,630
|
|
Total current liabilities
|
|
222,093
|
|
|
289,652
|
|
Long-term debt
(note 7)
|
|
810,961
|
|
|
990,558
|
|
Derivative liabilities
(note 8)
|
|
2,763
|
|
|
4,208
|
|
Other long-term liabilities
(note 9)
|
|
11,293
|
|
|
7,597
|
|
Total liabilities
|
|
1,047,110
|
|
|
1,292,015
|
|
Commitments and contingencies
(notes 5, 7 and 8)
|
|
|
|
|
||
Equity
|
|
|
|
|
||
Common stock and additional paid-in capital (300.0 million shares authorized, 133.1 million Class A and 23.2 million Class B shares issued and outstanding as of September 30, 2016 and 132.8 million Class A and 23.2 million Class B shares issued and outstanding as of December 31, 2015)
|
|
1,095,511
|
|
|
1,094,874
|
|
Accumulated deficit
|
|
(184,837
|
)
|
|
(217,413
|
)
|
Total equity
|
|
910,674
|
|
|
877,461
|
|
Total liabilities and equity
|
|
1,957,784
|
|
|
2,169,476
|
|
|
|
Nine Months Ended
|
|
Nine Months Ended
|
||
|
|
September 30, 2016
|
|
September 30, 2015
|
||
|
|
$
|
|
$
|
||
Cash and cash equivalents provided by (used for)
|
|
|
|
|
||
OPERATING ACTIVITIES
|
|
|
|
|
||
Net income
|
|
56,009
|
|
|
126,076
|
|
Non-cash items:
|
|
|
|
|
||
Depreciation and amortization
|
|
78,576
|
|
|
48,346
|
|
Loss on sale of vessel
|
|
137
|
|
|
—
|
|
Asset impairments
(note 13)
|
|
14,186
|
|
|
—
|
|
Unrealized gain on derivative instruments
|
|
(3,021
|
)
|
|
(5,297
|
)
|
Equity income
|
|
(9,599
|
)
|
|
(8,931
|
)
|
Other
|
|
6,555
|
|
|
1,821
|
|
Change in operating assets and liabilities
|
|
45,089
|
|
|
571
|
|
Expenditures for dry docking
|
|
(6,477
|
)
|
|
(17,749
|
)
|
Net operating cash flow
|
|
181,455
|
|
|
144,837
|
|
|
|
|
|
|
||
FINANCING ACTIVITIES
|
|
|
|
|
||
Proceeds from long-term debt, net of issuance costs
|
|
875,467
|
|
|
575,328
|
|
Repayments of long-term debt
|
|
(119,252
|
)
|
|
(21,276
|
)
|
Prepayment of long-term debt
|
|
(957,541
|
)
|
|
(191,592
|
)
|
Repayment of long-term debt of Entities under Common Control
(note 3)
|
|
—
|
|
|
(3,971
|
)
|
Equity contribution from Teekay Corporation to Entities under Common Control
(note 3)
|
|
—
|
|
|
1,641
|
|
Net advances to affiliates
(note 3)
|
|
—
|
|
|
(3,156
|
)
|
Cash dividends paid
|
|
(42,159
|
)
|
|
(10,519
|
)
|
Proceeds from equity offerings, net of offering costs
|
|
—
|
|
|
227,995
|
|
Net financing cash flow
|
|
(243,485
|
)
|
|
574,450
|
|
|
|
|
|
|
||
INVESTING ACTIVITIES
|
|
|
|
|
||
Proceeds from sale of vessels
(note 13)
|
|
14,078
|
|
|
—
|
|
Expenditures for vessels and equipment
|
|
(6,728
|
)
|
|
(230,664
|
)
|
Expenditures for Principal Maritimes vessel acquisitions
|
|
—
|
|
|
(526,021
|
)
|
Loan repayments from equity accounted investment
(note 5a)
|
|
2,500
|
|
|
1,000
|
|
Return of capital from (investment in) Teekay Tanker Operations Ltd.
(note 5c)
|
|
15,000
|
|
|
(239
|
)
|
Acquisition of SPT, net of $0.4 million of cash assumed
(note 17)
|
|
—
|
|
|
(45,581
|
)
|
Net investing cash flow
|
|
24,850
|
|
|
(801,505
|
)
|
|
|
|
|
|
||
Decrease in cash and cash equivalents
|
|
(37,180
|
)
|
|
(82,218
|
)
|
Cash and cash equivalents, beginning of the period
|
|
96,417
|
|
|
162,797
|
|
Cash and cash equivalents, end of the period
|
|
59,237
|
|
|
80,579
|
|
|
|
Common Stock and Additional
Paid-in Capital
|
|
|
|
|
|||||||||
|
|
Thousands
of Common
Stock
#
|
|
Class A
$
|
|
Class B
$
|
|
Accumulated
Deficit
$
|
|
Total
$
|
|||||
Balance as at December 31, 2015
|
|
156,031
|
|
|
1,032,239
|
|
|
62,635
|
|
|
(217,413
|
)
|
|
877,461
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
56,009
|
|
|
56,009
|
|
Dividends declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,433
|
)
|
|
(23,433
|
)
|
Equity-based compensation
(note 11)
|
|
253
|
|
|
637
|
|
|
—
|
|
|
—
|
|
|
637
|
|
Balance as at September 30, 2016
|
|
156,284
|
|
|
1,032,876
|
|
|
62,635
|
|
|
(184,837
|
)
|
|
910,674
|
|
1.
|
Basis of Presentation
|
2.
|
Accounting Pronouncements
|
3.
|
Acquisition of Entities under Common Control
|
4.
|
Segment Reporting
|
Three Months Ended September 30, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Conventional
|
|
Ship-to-Ship
|
|
|
|
|
|
|||||||
|
|
Tanker
|
|
Transfer
|
|
Inter-segment
|
|
|
|
|||||||
|
|
Segment
|
|
Segment
|
|
Adjustment
(1)
|
|
Total
|
||||||||
Revenues
|
|
95,626
|
|
|
|
9,837
|
|
|
|
(842
|
)
|
|
|
104,621
|
|
|
Voyage expenses
|
|
(15,775
|
)
|
|
|
—
|
|
|
|
842
|
|
|
|
(14,933
|
)
|
|
Vessel operating expenses
|
|
(37,462
|
)
|
|
|
(7,321
|
)
|
|
|
—
|
|
|
|
(44,783
|
)
|
|
Time-charter hire expense
|
|
(10,784
|
)
|
|
|
(551
|
)
|
|
|
—
|
|
|
|
(11,335
|
)
|
|
Depreciation and amortization
|
|
(24,651
|
)
|
|
|
(1,237
|
)
|
|
|
—
|
|
|
|
(25,888
|
)
|
|
General and administrative expenses
|
|
(2,955
|
)
|
|
|
(617
|
)
|
|
|
—
|
|
|
|
(3,572
|
)
|
|
Asset impairment
|
|
(7,766
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(7,766
|
)
|
|
Loss on sale of vessel
|
|
(137
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(137
|
)
|
|
(Loss) income from operations
(2)
|
|
(3,904
|
)
|
|
|
111
|
|
|
|
—
|
|
|
|
(3,793
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity Income
|
|
1,045
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,045
|
|
|
(1)
|
The ship-to-ship transfer segment provides lightering support services to the conventional tanker segment for full service lightering operations and the pricing for such services is based on estimated costs incurred of approximately
$25,000
per voyage.
|
(2)
|
Includes direct general and administrative expenses and indirect general and administrative expenses (allocated to each segment based on estimated use of corporate resources).
|
Three months ended September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Conventional
|
|
Ship-to-Ship
|
|
|
|
|
|
|||||||
|
|
Tanker
|
|
Transfer
|
|
Inter-segment
|
|
|
|
|||||||
|
|
Segment
|
|
Segment
|
|
Adjustment
(1)
|
|
Total
|
||||||||
Revenues
|
|
117,863
|
|
|
|
8,850
|
|
|
|
(312
|
)
|
|
|
126,401
|
|
|
Voyage expenses
|
|
(2,461
|
)
|
|
|
(192
|
)
|
|
|
—
|
|
|
|
(2,653
|
)
|
|
Vessel operating expenses
|
|
(29,164
|
)
|
|
|
(6,415
|
)
|
|
|
312
|
|
|
|
(35,267
|
)
|
|
Time-charter hire expense
|
|
(21,344
|
)
|
|
|
(38
|
)
|
|
|
—
|
|
|
|
(21,382
|
)
|
|
Depreciation and amortization
|
|
(17,234
|
)
|
|
|
(644
|
)
|
|
|
—
|
|
|
|
(17,878
|
)
|
|
General and administrative expenses
|
|
(3,398
|
)
|
|
|
(912
|
)
|
|
|
—
|
|
|
|
(4,310
|
)
|
|
Restructuring charges
|
|
—
|
|
|
|
(327
|
)
|
|
|
—
|
|
|
|
(327
|
)
|
|
Income from operations
(2)
|
|
44,262
|
|
|
|
322
|
|
|
|
—
|
|
|
|
44,584
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity Income
|
|
2,762
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,762
|
|
|
(1)
|
The ship-to-ship transfer segment provides lightering support services to the conventional tanker segment for full service lightering operations and the pricing for such services is based on estimated costs incurred of approximately
$25,000
per voyage.
|
(2)
|
Includes direct general and administrative expenses and indirect general and administrative expenses (allocated to each segment based on estimated use of corporate resources).
|
Nine Months Ended September 30, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Conventional
|
|
Ship-to-Ship
|
|
|
|
|
|
|
||||||
|
|
Tanker
|
|
Transfer
|
|
Inter-segment
|
|
|
|
|||||||
|
|
Segment
|
|
Segment
|
|
Adjustment
(1)
|
|
Total
|
||||||||
Revenues
|
|
380,283
|
|
|
|
30,922
|
|
|
|
(2,013
|
)
|
|
|
409,192
|
|
|
Voyage expenses
|
|
(39,527
|
)
|
|
|
—
|
|
|
|
2,013
|
|
|
|
(37,514
|
)
|
|
Vessel operating expenses
|
|
(112,248
|
)
|
|
|
(23,997
|
)
|
|
|
—
|
|
|
|
(136,245
|
)
|
|
Time-charter hire expense
|
|
(46,670
|
)
|
|
|
(1,294
|
)
|
|
|
—
|
|
|
|
(47,964
|
)
|
|
Depreciation and amortization
|
|
(74,925
|
)
|
|
|
(3,651
|
)
|
|
|
—
|
|
|
|
(78,576
|
)
|
|
General and administrative expenses
|
|
(11,359
|
)
|
|
|
(2,415
|
)
|
|
|
—
|
|
|
|
(13,774
|
)
|
|
Asset impairments
|
|
(14,186
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(14,186
|
)
|
|
Loss on sale of vessel
|
|
(137
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(137
|
)
|
|
Income (loss) from operations
(2)
|
|
81,231
|
|
|
|
(435
|
)
|
|
|
—
|
|
|
|
80,796
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity Income
|
|
9,599
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,599
|
|
|
(1)
|
The ship-to-ship transfer segment provides lightering support services to the conventional tanker segment for full service lightering operations and the pricing for such services is based on estimated costs incurred of approximately
$25,000
per voyage.
|
(2)
|
Includes direct general and administrative expenses and indirect general and administrative expenses (allocated to each segment based on estimated use of corporate resources).
|
Nine months ended September 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Conventional
|
|
Ship-to-Ship
|
|
|
|
|
|
|
||||||
|
|
Tanker
|
|
Transfer
|
|
Inter-segment
|
|
|
|
|||||||
|
|
Segment
|
|
Segment
|
|
Adjustment
(1)
|
|
Total
|
||||||||
Revenues
|
|
336,669
|
|
|
|
8,850
|
|
|
|
(312
|
)
|
|
|
345,207
|
|
|
Voyage expenses
|
|
(9,972
|
)
|
|
|
(192
|
)
|
|
|
—
|
|
|
|
(10,164
|
)
|
|
Vessel operating expenses
|
|
(80,982
|
)
|
|
|
(6,415
|
)
|
|
|
312
|
|
|
|
(87,085
|
)
|
|
Time-charter hire expense
|
|
(53,140
|
)
|
|
|
(38
|
)
|
|
|
—
|
|
|
|
(53,178
|
)
|
|
Depreciation and amortization
|
|
(47,702
|
)
|
|
|
(644
|
)
|
|
|
—
|
|
|
|
(48,346
|
)
|
|
General and administrative expenses
|
|
(10,080
|
)
|
|
|
(912
|
)
|
|
|
—
|
|
|
|
(10,992
|
)
|
|
Restructuring charges
|
|
(4,445
|
)
|
|
|
(327
|
)
|
|
|
—
|
|
|
|
(4,772
|
)
|
|
Income from operations
(2)
|
|
130,348
|
|
|
|
322
|
|
|
|
—
|
|
|
|
130,670
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity Income
|
|
8,931
|
|
|
|
—
|
|
|
|
—
|
|
|
|
8,931
|
|
|
(1)
|
The ship-to-ship transfer segment provides lightering support services to the conventional tanker segment for full service lightering operations and the pricing for such services is based on estimated costs incurred of approximately
$25,000
per voyage.
|
(2)
|
Includes direct general and administrative expenses and indirect general and administrative expenses (allocated to each segment based on estimated use of corporate resources).
|
|
As at
|
|
As at
|
||
|
September 30, 2016
|
|
December 31, 2015
|
||
|
$
|
|
$
|
||
Conventional Tanker
|
1,842,803
|
|
|
2,020,317
|
|
Ship-to-Ship Transfer
|
30,499
|
|
|
24,429
|
|
Cash and cash equivalents
|
59,237
|
|
|
96,417
|
|
Accounts receivable
|
25,245
|
|
|
28,313
|
|
Consolidated total assets
|
1,957,784
|
|
|
2,169,476
|
|
5.
|
Investments in and Advances to Equity Accounted Investments
|
|
|
As at September 30, 2016
|
|
As at December 31, 2015
|
||
|
|
$
|
|
$
|
||
High-Q Joint Venture
|
|
22,091
|
|
|
21,166
|
|
Tanker Investments Ltd.
|
|
47,376
|
|
|
44,195
|
|
Teekay Tanker Operations Ltd.
|
|
9,304
|
|
|
21,447
|
|
Total
|
|
78,771
|
|
|
86,808
|
|
a.
|
The Company has a joint venture arrangement with Wah Kwong Maritime Transport Holdings Limited (or
Wah Kwong
), whereby the Company has a
50%
economic interest in the High-Q joint venture, which is jointly controlled by the Company and Wah Kwong. The High-Q joint venture owns
one
Very Large Crude Carrier (or
VLCC
), which is trading on a fixed time charter-out contract expiring in 2018. Under this contract, the vessel earns a fixed daily rate and an additional amount if the daily rate of any sub-charter earned exceeds a certain threshold.
|
b.
|
In January 2014, the Company and Teekay formed Tanker Investments Ltd. (or
TIL
), which seeks to opportunistically acquire, operate and sell modern second-hand tankers to benefit from an expected recovery of the tanker market. In January 2014, the Company purchased
2.5 million
shares of common stock for
$25.0 million
and received a stock purchase warrant entitling it to purchase up to
750,000
additional shares of common stock of TIL (see note
8
). The stock purchase warrant is a derivative asset which had an estimated fair value of
$0.7 million
as at
September 30, 2016
(
December 31, 2015
-
$5.2 million
). The Company also received
one
preferred share which entitles the Company to
elect one board member
of TIL. The preferred share does not give the Company a right to any dividends or distributions of TIL. The Company accounts for its investment in TIL using the equity method. In October 2014, the Company purchased an additional
0.9 million
common shares of TIL on the open market. The common shares were acquired at a price of NOK
69
per share, or a purchase price of
$10.0 million
.
|
c.
|
In August 2014, the Company purchased from Teekay a
50%
interest in Teekay Tanker Operations Ltd. (or
TTOL
), which owns conventional tanker commercial management and technical management operations, including direct ownership in
five
commercially managed tanker pools, for an aggregate price of approximately
$23.7 million
, including working capital of
$6.7 million
. The Company accounts for its ownership interest in TTOL using the equity method. In January 2016, the Company received
$15.0 million
as a return of capital from TTOL.
|
6.
|
In-process Revenue Contracts
|
7.
|
Long-Term Debt
|
|
As at
|
|
As at
|
||
|
September 30, 2016
|
|
December 31, 2015
|
||
|
$
|
|
$
|
||
Revolving Credit Facilities due through 2021
|
466,787
|
|
|
530,971
|
|
Term Loans due through 2021
|
509,368
|
|
|
635,330
|
|
Total principal
|
976,155
|
|
|
1,166,301
|
|
Unamortized discount and debt issuance costs
|
(9,504
|
)
|
|
(1,696
|
)
|
Total debt
|
966,651
|
|
|
1,164,605
|
|
Less: current portion
|
(155,690
|
)
|
|
(174,047
|
)
|
Non-current portion of long-term debt
|
810,961
|
|
|
990,558
|
|
8.
|
Derivative Instruments
|
|
Interest Rate
|
|
Notional Amount
|
|
Fair Value / Carrying Amount of Asset (Liability)
|
|
Remaining Term
|
|
Fixed Interest Rate
|
||||
|
Index
|
|
$
|
|
$
|
|
(years)
|
|
(%)
(1)
|
||||
LIBOR-Based Debt:
|
|
|
|
|
|
|
|
|
|
|
|
||
U.S. Dollar-denominated interest rate swap
(2)
|
LIBOR
|
|
200,000
|
|
|
|
(28
|
)
|
|
|
—
|
|
2.61
|
U.S. Dollar-denominated interest rate swaps
(3)
|
LIBOR
|
|
200,000
|
|
|
|
(1,828
|
)
|
|
|
4.2
|
|
1.46
|
U.S. Dollar-denominated interest rate swaps
|
LIBOR
|
|
150,000
|
|
|
|
(2,699
|
)
|
|
|
4.3
|
|
1.55
|
U.S. Dollar-denominated interest rate swaps
|
LIBOR
|
|
50,000
|
|
|
|
(69
|
)
|
|
|
4.3
|
|
1.16
|
(1)
|
Excludes the margin the Company pays on its variable-rate debt, which, as of
September 30, 2016
, ranged from
0.30%
to
2.00%
.
|
(2)
|
Scheduled to expire in October 2016.
|
(3)
|
Scheduled to commence in October 2016.
|
|
Current portion of derivative assets
|
|
Derivative assets
|
|
Accrued liabilities
|
|
Current portion of derivative liabilities
|
|
Derivative liabilities
|
|
|||||
As at September 30, 2016
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest rate swaps
|
—
|
|
|
—
|
|
|
(2,044
|
)
|
|
(1,861
|
)
|
|
(2,763
|
)
|
|
Stock purchase warrant
|
—
|
|
|
717
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Time-charter swap
|
1,554
|
|
|
—
|
|
|
(441
|
)
|
|
—
|
|
|
—
|
|
|
|
1,554
|
|
|
717
|
|
|
(2,485
|
)
|
|
(1,861
|
)
|
|
(2,763
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
As at December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|||||
Interest rate swaps
|
—
|
|
|
—
|
|
|
(2,359
|
)
|
|
(6,330
|
)
|
|
(4,208
|
)
|
|
Stock purchase warrant
|
—
|
|
|
5,164
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Time-charter swap
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
—
|
|
|
5,164
|
|
|
(2,359
|
)
|
|
(6,330
|
)
|
|
(4,208
|
)
|
|
|
Three Months Ended
|
|
Three Months Ended
|
|
||||||||||||||
|
September 30, 2016
|
|
September 30, 2015
|
|
||||||||||||||
|
Realized gains (losses)
|
Unrealized gains (losses)
|
Total
|
|
Realized gains (losses)
|
Unrealized gains (losses)
|
Total
|
|
||||||||||
Interest rate swaps
|
(1,277
|
)
|
|
3,800
|
|
|
2,523
|
|
|
(2,476
|
)
|
|
1,550
|
|
|
(926
|
)
|
|
Stock purchase warrant
|
—
|
|
|
(199
|
)
|
|
(199
|
)
|
|
—
|
|
|
(105
|
)
|
|
(105
|
)
|
|
Time-charter swap
|
1,096
|
|
|
209
|
|
|
1,305
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(181
|
)
|
|
3,810
|
|
|
3,629
|
|
|
(2,476
|
)
|
|
1,445
|
|
|
(1,031
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Nine Months Ended
|
|
Nine Months Ended
|
|
||||||||||||||
|
September 30, 2016
|
|
September 30, 2015
|
|
||||||||||||||
|
Realized gains (losses)
|
Unrealized gains (losses)
|
Total
|
|
Realized gains (losses)
|
Unrealized gains (losses)
|
Total
|
|
||||||||||
Interest rate swaps
|
(12,145
|
)
|
|
5,914
|
|
|
(6,231
|
)
|
|
(7,392
|
)
|
|
4,533
|
|
|
(2,859
|
)
|
|
Stock purchase warrant
|
—
|
|
|
(4,447
|
)
|
|
(4,447
|
)
|
|
—
|
|
|
764
|
|
|
764
|
|
|
Time-charter swap
|
1,222
|
|
|
1,554
|
|
|
2,776
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(10,923
|
)
|
|
3,021
|
|
|
(7,902
|
)
|
|
(7,392
|
)
|
|
5,297
|
|
|
(2,095
|
)
|
|
9.
|
Other Income (Expense)
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
$
|
|
$
|
|
$
|
|
$
|
||||||||
Freight tax recovery (provision)
|
488
|
|
|
|
(1,343
|
)
|
|
|
(4,013
|
)
|
|
|
(1,685
|
)
|
|
Foreign exchange loss
|
(35
|
)
|
|
|
(42
|
)
|
|
|
(274
|
)
|
|
|
(154
|
)
|
|
Other income
|
—
|
|
|
|
—
|
|
|
|
154
|
|
|
|
1
|
|
|
Total
|
453
|
|
|
|
(1,385
|
)
|
|
|
(4,133
|
)
|
|
|
(1,838
|
)
|
|
10.
|
Financial Instruments
|
a.
|
Fair Value Measurements
|
|
|
|
|
September 30, 2016
|
|
December 31, 2015
|
||||||||
|
|
Fair
Value
Hierarchy
Level
|
|
Carrying
Amount
Asset /
(Liability)
$
|
|
Fair
Value
Asset /
(Liability)
$
|
|
Carrying
Amount
Asset /
(Liability)
$
|
|
Fair
Value
Asset /
(Liability)
$
|
||||
Recurring:
|
|
|
|
|
|
|
|
|
|
|
||||
Cash and cash equivalents and restricted cash
|
|
Level 1
|
|
60,237
|
|
|
60,237
|
|
|
97,287
|
|
|
97,287
|
|
Derivative instruments
(note 8)
|
|
|
|
|
|
|
|
|
|
|
||||
Interest rate swap agreements
(1)
|
|
Level 2
|
|
(4,624
|
)
|
|
(4,624
|
)
|
|
(10,538
|
)
|
|
(10,538
|
)
|
Time-charter swap agreement
(1)
|
|
Level 3
|
|
1,554
|
|
|
1,554
|
|
|
—
|
|
|
—
|
|
Stock purchase warrant
|
|
Level 3
|
|
717
|
|
|
717
|
|
|
5,164
|
|
|
5,164
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Non-Recurring:
|
|
|
|
|
|
|
|
|
|
|
||||
Vessel held for sale
(note 13)
|
|
Level 2
|
|
13,151
|
|
|
13,151
|
|
|
—
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Other:
|
|
|
|
|
|
|
|
|
|
|
||||
Advances to equity accounted investments
|
|
Note (2)
|
|
11,480
|
|
|
Note (2)
|
|
|
13,980
|
|
|
Note (2)
|
|
Long-term debt, including current portion
|
|
Level 2
|
|
(966,651)
|
|
(955,596)
|
|
(1,164,605)
|
|
(1,140,135)
|
(1)
|
The fair value of the Company’s interest rate swap agreements and time-charter swap agreement at
September 30, 2016
excludes accrued interest expense which is recorded in accrued liabilities on the unaudited consolidated balance sheets.
|
(2)
|
The advances to equity accounted investments together with the Company’s investments in the equity accounted investments form the net aggregate carrying value of the Company’s interests in the equity accounted investments in these consolidated financial statements. The fair values of the individual components of such aggregate interests as at
September 30, 2016
and
December 31, 2015
were not determinable.
|
|
|
Three Months
|
|
Nine Months
|
|
|
Ended
|
|
Ended
|
|
|
September 30, 2016
|
|
September 30, 2016
|
|
|
$
|
|
$
|
Fair value asset - beginning of the period
|
|
1,345
|
|
—
|
Settlements
|
|
(1,096)
|
|
(1,222)
|
Realized and unrealized gain
|
|
1,305
|
|
2,776
|
Fair value asset - at the end of the period
|
|
1,554
|
|
1,554
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
|
September 30, 2016
|
|
September 30, 2015
|
|
September 30, 2016
|
|
September 30, 2015
|
||||
|
|
$
|
|
$
|
|
$
|
|
$
|
||||
Fair value at the beginning of the period
|
|
916
|
|
|
5,526
|
|
|
5,164
|
|
|
4,657
|
|
Unrealized (loss) gain included in earnings
|
|
(199
|
)
|
|
(105
|
)
|
|
(4,447
|
)
|
|
764
|
|
Fair value at the end of the period
|
|
717
|
|
|
5,421
|
|
|
717
|
|
|
5,421
|
|
b.
|
Financing Receivables
|
|
|
|
|
September 30, 2016
|
|
December 31, 2015
|
||
Class of Financing Receivable
|
Credit Quality Indicator
|
|
Grade
|
$
|
|
$
|
||
Advances to equity accounted investments
|
Other internal metrics
|
|
Performing
|
11,480
|
|
|
13,980
|
|
Total
|
|
|
|
11,480
|
|
|
13,980
|
|
11.
|
Capital Stock and Stock-Based Compensation
|
12.
|
Related Party Transactions
|
a.
|
Teekay and its wholly-owned subsidiary Teekay Tankers Management Services Ltd., which is the Company’s manager (or
the Manager
), provide commercial, technical, strategic and administrative services to the Company. In addition, certain of the Company’s vessels participate in pooling arrangements that are managed in whole or in part by subsidiaries of Teekay (collectively the
Pool Managers
). For additional information about these arrangements, please read “Item 7 – Major Shareholders and Related Party Transactions – Related Party Transactions” in our Annual Report on Form 20-F for the year ended
December 31, 2015
. Amounts received and paid by the Company for such related party transactions for the periods indicated were as follows:
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||||
|
September 30, 2016
|
September 30, 2015
|
September 30, 2016
|
September 30, 2015
|
||||||||
|
$
|
$
|
$
|
$
|
||||||||
Time-charter revenues
(i)
|
417
|
|
|
—
|
|
|
5,404
|
|
|
—
|
|
|
Lay-up service revenues
(ii)
|
200
|
|
|
—
|
|
|
432
|
|
|
—
|
|
|
Pool management fees and commissions
(iii)
|
(2,043
|
)
|
|
(2,630
|
)
|
|
(7,929
|
)
|
|
(7,490
|
)
|
|
Commercial management fees
(iv)
|
(490
|
)
|
|
(385
|
)
|
|
(1,238
|
)
|
|
(827
|
)
|
|
Vessel operating expenses - technical management fee
(v)
|
(2,338
|
)
|
|
(1,687
|
)
|
|
(6,925
|
)
|
|
(4,843
|
)
|
|
Strategic and administrative service fees
(vi)
|
(2,471
|
)
|
|
(1,594
|
)
|
|
(7,461
|
)
|
|
(5,313
|
)
|
|
Entities under Common Control (note 3)
|
|
|
|
|
|
|
|
|
||||
Time-charter revenues
(vii)
|
—
|
|
|
663
|
|
|
—
|
|
|
4,558
|
|
|
Commercial management fees
|
—
|
|
|
(64
|
)
|
|
—
|
|
|
(191
|
)
|
|
Vessel operating expenses - technical management fee
|
—
|
|
|
(112
|
)
|
|
—
|
|
|
(334
|
)
|
|
Strategic and administrative service fees
|
—
|
|
|
(171
|
)
|
|
—
|
|
|
(511
|
)
|
|
(i)
|
In December 2015, immediately after the acquisition of the 2015 Acquired Business, the Company chartered-out the
Navigator Spirit
to Teekay under a fixed-rate time-charter contract, which was scheduled to expire in July 2016. On May 18, 2016, the contract was transferred to the
Americas Spirit
, which subsequently expired on July 15, 2016.
|
(ii)
|
The Company recorded revenues of
$0.2 million
and
$0.4 million
for the
three and nine
months ended
September 30, 2016
, respectively, to provide lay-up services to Teekay for
two
of its in-chartered vessels.
|
(iii)
|
The Company’s share of the Pool Managers’ fees that are reflected as a reduction to net pool revenues from affiliates on the Company’s consolidated statements of (loss) income. The Company is entitled to a share of the Pool Managers' fees due to its
50%
ownership interest in TTOL. (See Note 5(c)).
|
(iv)
|
The Manager’s commercial management fees for vessels on time-charter out contracts and spot-traded vessels not included in the pool, which are reflected in voyage expenses on the Company’s consolidated statements of (loss) income.
|
(v)
|
The cost of ship management services provided by the Manager has been presented as vessel operating expenses on the Company's consolidated statement of (loss) income.
|
(vi)
|
The Manager's strategic and administrative service fees have been presented in general and administrative fees on the Company's consolidated statements of (loss) income. The Company's executive officers are employees of Teekay or subsidiaries thereof, and their compensation (other than any awards under the Company's long-term incentive plan described in note
11
) is set and paid by Teekay or such other subsidiaries. The Company reimburses Teekay for time spent by its executive officers on the Company's management matters through the strategic portion of the management fee.
|
(vii)
|
The Company recorded revenues of
$0.7 million
and
$4.6 million
for the
three and nine
months ended
September 30, 2015
, respectively, related to a time charter-out contract for the
Explorer Spirit
associated with the Entities under Common Control. The vessel was under a fixed-rate time-charter with SPT which expired in September 2015.
|
b.
|
The Manager and other subsidiaries of Teekay collect revenues and remit payments for expenses incurred by the Company’s vessels. Such amounts, which are presented on the Company’s consolidated balance sheets in due from affiliates or due to affiliates, are without interest or stated terms of repayment. The amounts owing from the Pool Managers for monthly distributions are reflected in the consolidated balance sheets as pool receivable from affiliates, are without interest and are repayable upon the terms contained within the applicable pool agreement. The Company had also advanced
$40.8 million
and
$46.8 million
as at
September 30, 2016
and
|
c.
|
On July 31, 2015, the Company acquired SPT (see note
17
).
|
13.
|
Asset Impairments and Sales of Vessels
|
14.
|
(Loss) Income Per Share
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
September 30, 2016
|
|
September 30, 2015
|
|
September 30, 2016
|
|
September 30, 2015
|
||||
|
$
|
|
$
|
|
$
|
|
$
|
||||
Net (loss) income
|
(5,457
|
)
|
|
40,950
|
|
|
56,009
|
|
|
126,076
|
|
Net loss (income) attributable to the Entities under Common Control
|
—
|
|
|
263
|
|
|
—
|
|
|
(1,636
|
)
|
Net (loss) income available for common shareholders
|
(5,457
|
)
|
|
41,213
|
|
|
56,009
|
|
|
124,440
|
|
|
|
|
|
|
|
|
|
||||
Weighted average number of common shares – basic
|
156,284,136
|
|
|
134,630,768
|
|
|
156,192,572
|
|
|
121,933,274
|
|
Dilutive effect of stock-based awards
|
—
|
|
|
543,988
|
|
|
266,119
|
|
|
570,796
|
|
Weighted average number of common shares – diluted
|
156,284,136
|
|
|
135,174,756
|
|
|
156,458,691
|
|
|
122,504,070
|
|
|
|
|
|
|
|
|
|
||||
(Loss) income per common share:
|
|
|
|
|
|
|
|
||||
– Basic
|
(0.03
|
)
|
|
0.31
|
|
|
0.36
|
|
|
1.02
|
|
– Diluted
|
(0.03
|
)
|
|
0.30
|
|
|
0.36
|
|
|
1.02
|
|
15.
|
Shipbuilding Contracts
|
16.
|
Other Revenues and Restructuring Charges
|
17.
|
Acquisition of Ship-to-Ship Transfer Business
|
|
|
As at
|
||
ASSETS
|
July 31, 2015
|
|||
Cash, cash equivalents and short-term restricted cash
|
1,292
|
|
|
|
Accounts receivable
|
10,332
|
|
|
|
Prepaid expenses and other current assets
|
3,763
|
|
|
|
Vessels and equipment
|
6,475
|
|
|
|
Other assets
|
143
|
|
|
|
Intangible assets subject to amortization
|
|
|
|
|
|
Customer relationships
(1)
|
17,901
|
|
|
|
Customer contracts
(1)
|
4,599
|
|
|
Goodwill
(2)
|
8,059
|
|
|
|
Total assets acquired
|
52,564
|
|
|
|
LIABILITIES
|
|
|
|
|
Accounts payable
|
(3,650
|
)
|
|
|
Accrued liabilities
|
(3,276
|
)
|
|
|
Total liabilities assumed
|
(6,926
|
)
|
|
|
Net assets acquired
(3)
|
45,638
|
|
|
(1)
|
The customer relationships and customer contracts are being amortized over a weighted average amortization period of
10
years and
7.6
years, respectively. As at
September 30, 2016
, the gross carrying amount, accumulated amortization and net carrying amount were
$22.5 million
,
$4.0 million
and
$18.5 million
, respectively. Amortization of intangible assets following
September 30, 2016
is expected to be
$0.8 million
(remainder of 2016),
$3.2 million
(2017),
$2.9 million
(2018),
$2.2 million
(2019),
$2.0 million
(2020) and
$7.4 million
(thereafter).
|
(2)
|
Goodwill recognized from this acquisition attributed
$1.9 million
to the Company’s conventional tanker segment and
$6.2 million
to the Company’s ship-to-ship transfer segment.
|
(3)
|
Prior to the SPT acquisition date, SPT had in-chartered the
Explorer Spirit
from Teekay, which vessel the Company acquired in December 2015. Retroactively adjusting the Company’s consolidated financial statements for the acquisition of the
Explorer Spirit
has resulted in
$1.4 million
of the SPT acquisition purchase price being characterized as the settlement of a pre-existing relationship. Such amount has been accounted for as a reduction to revenue on the SPT acquisition date.
|
|
|
Unaudited
|
||
|
|
Pro Forma
|
||
|
|
Nine Months Ended
|
||
|
|
September 30, 2015
|
||
Revenues
|
385,465
|
|
|
|
Net Income
|
125,274
|
|
|
|
Earnings per common share:
|
|
|
|
|
|
Basic
|
0.97
|
|
|
|
Diluted
|
0.97
|
|
|
18.
|
Subsequent Events
|
a.
|
In September 2016, the Company entered into negotiations to sell an MR tanker, the
Hugli Spirit
, for a sales price of approximately
$13.2 million
. The sale was completed in November 2016. The vessel was classified as held for sale on the consolidated balance sheet as at September 30, 2016 and its net book value was written down to its sales price in the third quarter of 2016. As a result, there is
no
gain or loss on the sale of this vessel expected for the quarter ended December 31, 2016 (see note
13
).
|
b.
|
In late October 2016, the Company entered into agreements to sell
two
Suezmax tankers, the
Ganges Spirit
and
Yamuna Spirit
, for an aggregate sales price of approximately
$33.8 million
. The
two
vessels had an aggregate net book value of
$40.3 million
as of September 30, 2016. The vessels will be written down to their sales price in the fourth quarter of 2016 and are expected to be delivered in early 2017. Both vessels are used as collateral for one of the Company's revolvers which had a balance of
$79.1 million
as at September 30, 2016. Proceeds from the sale of the vessels will be used to repay a portion of the revolver.
|
c.
|
In October 2016, the Company entered into a time chartered-in contract for
one
Aframax tanker with a daily rate of
$17,000
and a contract period of
12
months with a
three
-month option at an escalated rate. At the same time, the Company entered into a profit or loss sharing agreement with another party to share
50%
of the net profit or loss of such in-chartered Aframax vessel.
|
|
Owned Vessels
(1)
|
Chartered-in Vessels
|
Total
|
|
Fixed-rate:
|
|
|
|
|
Suezmax Tankers
|
4
|
—
|
4
|
|
Aframax Tankers
|
6
|
—
|
6
|
|
LR2 Product Tanker
(2)
|
1
|
1
|
2
|
|
VLCC Tanker
(3)
|
1
|
—
|
1
|
|
Total Fixed-Rate Fleet
(4)
|
12
|
1
|
13
|
|
|
|
|
|
|
Spot-rate:
|
|
|
|
|
Suezmax Tankers
|
18
|
—
|
18
|
|
Aframax Tankers
(5)
|
8
|
4
|
12
|
|
LR2 Product Tankers
|
6
|
—
|
6
|
|
MR Product Tanker
(6)
|
1
|
—
|
1
|
|
Total Spot Fleet
(7)
|
33
|
4
|
37
|
|
STS Support Vessels
|
6
|
1
|
7
|
|
Total Teekay Tankers Fleet
|
51
|
6
|
57
|
1.
|
Vessels owned by Tanker Investments Ltd. (or
TIL
), in which we have a minority equity interest, are excluded from the fleet list.
|
2.
|
Long Range 2 (or
LR2
) product tankers. One LR2 tanker is currently time-chartered in for a period of 24 months ending in 2017 with an option to extend.
|
3.
|
VLCC owned through a 50/50 joint venture.
|
4.
|
One time-charter out contract is scheduled to expire in
2016
, five in
2017
, six in 2018 and one in
2019
.
|
5.
|
Four Aframax tankers are currently time-chartered in for initial periods ranging from 12 to 60 months, with three of these periods ending in
2017
and one in 2021; some of these contracts include options to extend at escalating rates.
|
6.
|
Medium Range (or
MR
) product tanker.
|
7.
|
A total of 28 of our owned vessels and three of our in-chartered vessels operated in the spot market in pooling arrangements, a majority of which are managed in whole or in part by subsidiaries of Teekay Corporation (or
Teekay
). As at
September 30, 2016
, the five vessel class pooling arrangements in which we participate were comprised of a total of 33 Suezmax tankers, 25 modern Aframax tankers, three Aframax tankers over 15-years-old, 11 LR2 tankers and 55 MR tankers, in each case including vessels owned by other pool members.
|
|
Conventional Tankers
|
|
Ship-to-ship Transfer
|
|
Total
|
||||||||||||||||||
|
Three Months Ended September 30,
|
||||||||||||||||||||||
(in thousands of U.S. dollars)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenues
(1)(2)
|
95,626
|
|
|
|
117,863
|
|
|
|
8,995
|
|
|
|
8,538
|
|
|
|
104,621
|
|
|
|
126,401
|
|
|
Less: Voyage expenses
(1)
|
(14,933
|
)
|
|
|
(2,461
|
)
|
|
|
—
|
|
|
|
(192
|
)
|
|
|
(14,933
|
)
|
|
|
(2,653
|
)
|
|
Net revenues
|
80,693
|
|
|
|
115,402
|
|
|
|
8,995
|
|
|
|
8,346
|
|
|
|
89,688
|
|
|
|
123,748
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Vessel operating expenses
(2)
|
(37,462
|
)
|
|
|
(28,852
|
)
|
|
|
(7,321
|
)
|
|
|
(6,415
|
)
|
|
|
(44,783
|
)
|
|
|
(35,267
|
)
|
|
Time-charter hire expense
|
(10,784
|
)
|
|
|
(21,344
|
)
|
|
|
(551
|
)
|
|
|
(38
|
)
|
|
|
(11,335
|
)
|
|
|
(21,382
|
)
|
|
Depreciation and amortization
|
(24,651
|
)
|
|
|
(17,234
|
)
|
|
|
(1,237
|
)
|
|
|
(644
|
)
|
|
|
(25,888
|
)
|
|
|
(17,878
|
)
|
|
General and administrative expenses
|
(2,955
|
)
|
|
|
(3,398
|
)
|
|
|
(617
|
)
|
|
|
(912
|
)
|
|
|
(3,572
|
)
|
|
|
(4,310
|
)
|
|
Loss on sale of vessel
|
(137
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(137
|
)
|
|
|
—
|
|
|
Asset impairments
|
(7,766
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(7,766
|
)
|
|
|
—
|
|
|
Restructuring charges
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(327
|
)
|
|
|
—
|
|
|
|
(327
|
)
|
|
(Loss) income from operations
|
(3,062
|
)
|
|
|
44,574
|
|
|
|
(731
|
)
|
|
|
10
|
|
|
|
(3,793
|
)
|
|
|
44,584
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity income
|
1,045
|
|
|
|
2,762
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,045
|
|
|
|
2,762
|
|
|
(1)
|
Excludes
$0.8 million
of revenues for the three months ended
September 30, 2016
relating to lightering support services which the ship-to-ship transfer segment provided to the conventional tanker segment for full service lightering operations.
|
(2)
|
Excludes
$0.3 million
of revenues for the three months ended
September 30, 2015
relating to lightering support services which the ship-to-ship transfer segment provided to the conventional tanker segment for full service lightering operations.
|
|
Conventional Tankers
|
|
Ship-to-ship Transfer
|
|
Total
|
||||||||||||||||||
|
Nine Months Ended September 30,
|
|
|||||||||||||||||||||
(in thousands of U.S. dollars)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Revenues
(1)(2)
|
380,283
|
|
|
|
336,669
|
|
|
|
28,909
|
|
|
|
8,538
|
|
|
|
409,192
|
|
|
|
345,207
|
|
|
Less: Voyage expenses
(1)
|
(37,514
|
)
|
|
|
(9,972
|
)
|
|
|
—
|
|
|
|
(192
|
)
|
|
|
(37,514
|
)
|
|
|
(10,164
|
)
|
|
Net revenues
|
342,769
|
|
|
|
326,697
|
|
|
|
28,909
|
|
|
|
8,346
|
|
|
|
371,678
|
|
|
|
335,043
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Vessel operating expenses
(2)
|
(112,248
|
)
|
|
|
(80,670
|
)
|
|
|
(23,997
|
)
|
|
|
(6,415
|
)
|
|
|
(136,245
|
)
|
|
|
(87,085
|
)
|
|
Time-charter hire expense
|
(46,670
|
)
|
|
|
(53,140
|
)
|
|
|
(1,294
|
)
|
|
|
(38
|
)
|
|
|
(47,964
|
)
|
|
|
(53,178
|
)
|
|
Depreciation and amortization
|
(74,925
|
)
|
|
|
(47,702
|
)
|
|
|
(3,651
|
)
|
|
|
(644
|
)
|
|
|
(78,576
|
)
|
|
|
(48,346
|
)
|
|
General and administrative expenses
|
(11,359
|
)
|
|
|
(10,080
|
)
|
|
|
(2,415
|
)
|
|
|
(912
|
)
|
|
|
(13,774
|
)
|
|
|
(10,992
|
)
|
|
Loss on sale of vessel
|
(137
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(137
|
)
|
|
|
—
|
|
|
Asset impairments
|
(14,186
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(14,186
|
)
|
|
|
—
|
|
|
Restructuring charges
|
—
|
|
|
|
(4,445
|
)
|
|
|
—
|
|
|
|
(327
|
)
|
|
|
—
|
|
|
|
(4,772
|
)
|
|
Income (loss) from operations
|
83,244
|
|
|
|
130,660
|
|
|
|
(2,448
|
)
|
|
|
10
|
|
|
|
80,796
|
|
|
|
130,670
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity income
|
9,599
|
|
|
|
8,931
|
|
|
|
—
|
|
|
|
—
|
|
|
|
9,599
|
|
|
|
8,931
|
|
|
(1)
|
Excludes
$2.0 million
of revenues for the
nine
months ended
September 30, 2016
relating to lightering support services which the ship-to-ship transfer segment provided to the conventional tanker segment for full service lightering operations.
|
(2)
|
Excludes
$0.3 million
of revenues for the
nine
months ended
September 30, 2015
relating to lightering support services which the ship-to-ship transfer segment provided to the conventional tanker segment for full service lightering operations.
|
|
Conventional Tanker Segment
|
|||||||||||||||||
|
Three Months Ended September 30, 2016
|
|||||||||||||||||
|
Revenues
(1)
|
Voyage Expenses
(2)
|
Adjustments
(3)
|
Net Revenues
|
Revenue Days
|
Average TCE per Revenue Day
(3)
|
||||||||||||
|
(in thousands)
|
(in thousands)
|
(in thousands)
|
(in thousands)
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Voyage-charter contracts - Suezmax
|
|
$30,845
|
|
|
($1,394
|
)
|
|
$1,208
|
|
|
$30,659
|
|
1,742
|
|
|
$17,603
|
|
|
Voyage-charter contracts - Aframax
(4)
|
|
$29,545
|
|
|
($13,638
|
)
|
|
$648
|
|
|
$16,555
|
|
1,111
|
|
|
$14,894
|
|
|
Voyage-charter contracts - LR2
|
|
$10,460
|
|
|
$27
|
|
|
$351
|
|
|
$10,838
|
|
705
|
|
|
$15,384
|
|
|
Voyage-charter contracts - MR
|
|
$1,499
|
|
|
($20
|
)
|
|
$29
|
|
|
$1,508
|
|
123
|
|
|
$12,224
|
|
|
Time-charter out contracts - Suezmax
|
|
$7,501
|
|
|
($458
|
)
|
|
$93
|
|
|
$7,136
|
|
268
|
|
|
$26,675
|
|
|
Time-charter out contracts - Aframax
|
|
$13,278
|
|
|
($211
|
)
|
|
$164
|
|
|
$13,231
|
|
568
|
|
|
$23,282
|
|
|
Time-charter out contracts - LR2
|
|
$2,498
|
|
|
($81
|
)
|
|
$30
|
|
|
$2,447
|
|
97
|
|
|
$25,228
|
|
|
Total
(1)
|
|
$95,626
|
|
|
($15,775
|
)
|
|
$2,523
|
|
|
$82,374
|
|
4,614
|
|
|
$17,854
|
|
|
(1)
|
Excludes
$9.0 million
of revenues, which is net of $0.8 million of inter-segment revenue relating to lightering support services provided by the ship-to-ship transfer segment for the three months ended
September 30, 2016
.
|
(2)
|
Includes $0.8 million of inter-segment voyage expenses relating to lightering support services provided by the ship-to-ship transfer segment.
|
(3)
|
Average TCE per Revenue Day excludes a total of
$2.6 million
in pool management fees and commissions payable for commercial management for our vessels and
$(0.1) million
in off-hire bunker and other adjustments, all of which are included as part of the adjustments.
|
(4)
|
Includes
$11.7 million
of revenues and
$8.5 million
of voyage expenses, which include $0.8 million inter-segment expense relating to lightering support services provided by the ship-to-ship transfer segment to the full services lightering business for the three months ended
September 30, 2016
.
|
|
Three Months Ended September 30, 2015
|
|||||||||||||||||
|
Revenues
(1)
|
Voyage Expenses
|
Adjustments
(2)
|
Net Revenues
|
Revenue Days
|
Average TCE per Revenue Day
(2)
|
||||||||||||
|
(in thousands)
|
(in thousands)
|
(in thousands)
|
(in thousands)
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Voyage-charter contracts - Suezmax
|
|
$27,640
|
|
|
($339
|
)
|
|
$1,128
|
|
|
$28,429
|
|
818
|
|
|
$34,774
|
|
|
Voyage-charter contracts - Aframax
(3)
|
|
$38,511
|
|
|
($1,316
|
)
|
|
$1,319
|
|
|
$38,514
|
|
1,177
|
|
|
$32,719
|
|
|
Voyage-charter contracts - LR2
|
|
$25,039
|
|
|
($247
|
)
|
|
$1,137
|
|
|
$25,929
|
|
773
|
|
|
$33,555
|
|
|
Voyage-charter contracts - MR
|
|
$6,334
|
|
|
($49
|
)
|
|
$275
|
|
|
$6,560
|
|
276
|
|
|
$23,782
|
|
|
Time-charter out contracts - Suezmax
|
|
$4,469
|
|
|
($57
|
)
|
|
$50
|
|
|
$4,462
|
|
133
|
|
|
$33,646
|
|
|
Time-charter out contracts - Aframax
|
|
$13,733
|
|
|
($481
|
)
|
|
$254
|
|
|
$13,506
|
|
765
|
|
|
$17,651
|
|
|
Time-charter out contracts - LR2
|
|
$2,152
|
|
|
($38
|
)
|
—
|
|
|
$2,114
|
|
83
|
|
|
$25,515
|
|
|
|
Time-charter out contracts - MR
|
|
($15
|
)
|
|
$66
|
|
|
($51
|
)
|
—
|
|
—
|
|
—
|
|
|
||
Total
(1)
|
|
$117,863
|
|
|
($2,461
|
)
|
|
$4,112
|
|
|
$119,514
|
|
4,025
|
|
|
$26,694
|
|
|
(1)
|
Excludes
$8.5 million
of revenues, which is net of $0.3 million of inter-segment revenue relating to lightering support services provided by the ship-to-ship transfer segment and
$0.2 million
of voyage expenses related to the lightering support services business for the three months ended
September 30, 2015
.
|
(2)
|
Average TCE per Revenue Day excludes a total of
$3.0 million
in pool management fees and commissions payable for commercial management for our vessels and
$1.1 million
in off-hire bunker and other expenses, all of which are included as part of the adjustments.
|
(3)
|
Includes
$4.8 million
of revenues and
$0.9 million
of voyage expenses related to the full service lightering business for the three months ended
September 30, 2015
.
|
|
Nine Months Ended September 30, 2016
|
|||||||||||||||||
|
Revenues
(1)
|
Voyage Expenses
(2)
|
Adjustments
(3)
|
Net Revenues
|
Revenue Days
|
Average TCE per Revenue Day
(3)
|
||||||||||||
|
(in thousands)
|
(in thousands)
|
(in thousands)
|
(in thousands)
|
|
|
|
|||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Voyage-charter contracts - Suezmax
|
|
$143,876
|
|
|
($3,945
|
)
|
|
$4,643
|
|
|
$144,574
|
|
5,133
|
|
|
$28,167
|
|
|
Voyage-charter contracts - Aframax
(4)
|
|
$117,627
|
|
|
($33,822
|
)
|
|
$2,927
|
|
|
$86,732
|
|
3,904
|
|
|
$22,211
|
|
|
Voyage-charter contracts - LR2
|
|
$40,936
|
|
|
$49
|
|
|
$1,244
|
|
|
$42,229
|
|
2,112
|
|
|
$19,996
|
|
|
Voyage-charter contracts - MR
|
|
$7,736
|
|
|
($28
|
)
|
|
$300
|
|
|
$8,008
|
|
487
|
|
|
$16,433
|
|
|
Time-charter out contracts - Suezmax
|
|
$19,656
|
|
|
($793
|
)
|
|
$253
|
|
|
$19,116
|
|
639
|
|
|
$29,917
|
|
|
Time-charter out contracts - Aframax
|
|
$41,976
|
|
|
($705
|
)
|
|
$536
|
|
|
$41,807
|
|
1,787
|
|
|
$23,392
|
|
|
Time-charter out contracts - LR2
|
|
$7,271
|
|
|
($283
|
)
|
|
$90
|
|
|
$7,078
|
|
279
|
|
|
$25,365
|
|
|
Time-charter out contracts - MR
|
|
($18
|
)
|
—
|
|
|
$18
|
|
—
|
|
—
|
|
—
|
|
|
|||
Total
(1)
|
|
$379,060
|
|
|
($39,527
|
)
|
|
$10,011
|
|
|
$349,544
|
|
14,341
|
|
|
$24,372
|
|
|
(1)
|
Excludes
$28.9 million
of revenues, which is net of $2.0 million of inter-segment revenue relating to lightering support services and
$1.2 million
of in-process revenue contract revenue for the nine months ended
September 30, 2016
.
|
(2)
|
Includes $2.0 million of inter-segment voyage expenses relating to lightering support services provided by the ship-to-ship transfer segment.
|
(3)
|
Average TCE per Revenue Day excludes a total of
$9.6 million
in pool management fees and commissions payable for commercial management for our vessels and
$0.4 million
in off-hire bunker and other expenses, all of which are included as part of the adjustments.
|
(4)
|
Includes
$31.8 million
of revenues and
$23.7 million
of voyage expenses, which include $2.0 million inter-segment expense relating to lightering support services provided by the ship-to-ship transfer segment to the full service lightering business for the nine months ended September 30, 2016.
|
|
Nine Months Ended September 30, 2015
|
|||||||||||||||||
|
Revenues
(1)
|
Voyage Expenses
|
Adjustments
(2)
|
Net Revenues
|
Revenue Days
|
Average TCE per Revenue Day
(2)
|
||||||||||||
|
(in thousands)
|
(in thousands)
|
(in thousands)
|
(in thousands)
|
|
|
|
|||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Voyage-charter contracts - Suezmax
|
|
$95,374
|
|
|
($582
|
)
|
|
$3,574
|
|
|
$98,366
|
|
2,606
|
|
|
$37,743
|
|
|
Voyage-charter contracts - Aframax
(3)
|
|
$107,695
|
|
|
($6,985
|
)
|
|
$2,822
|
|
|
$103,532
|
|
3,387
|
|
|
$30,565
|
|
|
Voyage-charter contracts - LR2
|
|
$65,807
|
|
|
($158
|
)
|
|
$2,399
|
|
|
$68,048
|
|
2,323
|
|
|
$29,295
|
|
|
Voyage-charter contracts - MR
|
|
$14,961
|
|
|
($55
|
)
|
|
$949
|
|
|
$15,855
|
|
727
|
|
|
$21,796
|
|
|
Time-charter out contracts - Suezmax
|
|
$4,423
|
|
|
($54
|
)
|
|
$93
|
|
|
$4,462
|
|
133
|
|
|
$33,646
|
|
|
Time-charter out contracts - Aframax
|
|
$39,829
|
|
|
($2,034
|
)
|
|
$1,495
|
|
|
$39,290
|
|
2,140
|
|
|
$18,363
|
|
|
Time-charter out contracts - LR2
|
|
$2,152
|
|
|
($38
|
)
|
—
|
|
|
$2,114
|
|
83
|
|
|
$25,515
|
|
|
|
Time-charter out contracts - MR
|
|
$1,982
|
|
|
($66
|
)
|
|
$54
|
|
|
$1,970
|
|
50
|
|
|
$39,036
|
|
|
Total
(1)
|
|
$332,223
|
|
|
($9,972
|
)
|
|
$11,386
|
|
|
$333,637
|
|
11,449
|
|
|
$29,140
|
|
|
(1)
|
Excludes
$8.5 million
of revenues, which is net of $0.3 million of inter-segment revenue relating to lightering support services provided by the ship-to-ship transfer segment,
$0.2 million
of voyage expenses related to the lightering support services business and
$4.4 million
of crew redundancy cost recovery from one of our customers for the nine months ended
September 30, 2015
.
|
(2)
|
Average TCE per Revenue Day excludes a total of
$8.8 million
in pool management fees and commissions payable for commercial management for our vessels and
$2.6 million
in off-hire bunker and other expenses, all of which are included as part of the adjustments.
|
(3)
|
Includes
$4.8 million
of revenues and
$0.9 million
of voyage expenses related to the full services lightering business for the nine months ended
September 30, 2015
.
|
•
|
a decrease of $35.2 million for the three months ended
September 30, 2016
due to lower average realized rates earned by our Suezmax, Aframax, LR2 and MR tankers;
|
•
|
a net decrease of $3.7 million for the three months ended
September 30, 2016
due to various vessels changing employment between fixed-rate charters and spot voyage charters; and
|
•
|
a net decrease of $2.0 million for the three months ended
September 30, 2016
primarily due to the redeliveries of eight in-charters to their owners in the first three quarters of
2016
and the sale of two MR product tankers in
2015
and
2016
, partially offset by the addition of 12 Suezmax tankers that we acquired during the second half of
2015
and the addition of one Aframax in-charter that was delivered to us during
2016
;
|
•
|
an increase of $2.9 million for the three months ended
September 30, 2016
due to higher average rates earned on our out-chartered Aframax tankers;
|
•
|
net increases of $1.7 million for the three months ended
September 30, 2016
due to lower pool management fees, commissions, off-hire bunker and other expenses in the first three quarters of 2016 compared to the same period in the prior year;
|
•
|
a net increase o
f $1.4 million for the three months ended
September 30, 2016
due to fewer off-hire days in the three months ended September 30,
2016
compared to the same period in the prior year; and
|
•
|
a net increase of $0.8 million for the three months ended
September 30, 2016
due to the acquisition of the STS transfer business during the third quarter of
2015
, which is partially offset by a decrease of $0.7 million related to full service lightering operations that are included as part of our conventional tanker segment for the three months ended
September 30, 2016
.
|
•
|
a net increase of $65.5 million for the nine months ended
September 30, 2016
primarily due to the addition of 12 Suezmax tankers that we acquired during the second half of
2015
and the addition of three Aframax in-charters and one LR2 in-charter that were delivered to us at various times during
2015
and
2016
, partially offset by the redeliveries of eight in-chartered vessels to their owners during
2016
and the sale of two MR product tankers in
2015
and
2016
;
|
•
|
an increase of $26.7 million for the nine months ended
September 30, 2016
due to the acquisition of the STS transfer business during the third quarter of
2015
, of which $4.2 million is related to full service lightering operations that are included as part of our conventional tanker segment for the nine months ended
September 30, 2016
;
|
•
|
an increase of $8.7 million for the nine months ended
September 30, 2016
due to higher average rates earned on our out-chartered Aframax tankers;
|
•
|
an increase o
f $8.0 million for the nine months ended
September 30, 2016
due to fewer off-hire days in the first nine months of
2016
compared to the same period in the prior year;
|
•
|
an increase of $1.6 million for the nine months ended
September 30, 2016
due to lower pool management fees, commissions, off-hire bunker and other expenses in the first nine months of 2016 compared to the same period in the prior year;
|
•
|
an increase of $1.2 million for the nine months ended
September 30, 2016
due to in-process revenue contract amortization we recognized in revenue in the first quarter of 2016; and
|
•
|
an increase of $1.1 million for the nine months ended
September 30, 2016
due to one additional calendar day as 2016 is a leap year;
|
•
|
a decrease of $65.9 million for the nine months ended
September 30, 2016
due to lower average realized rates earned by our Suezmax, Aframax, LR2 and MR tankers;
|
•
|
a net decrease of $5.9 million for the nine months ended
September 30, 2016
due to various vessels changing employment between fixed-rate charters and spot voyage charters; and
|
•
|
a decrease of $4.4 million for the nine months ended
September 30, 2016
due to redundancy cost for the Australian seafarers that we recovered from the customer upon expiration of a time-charter out contract of a MR product tanker in the first quarter of 2015.
|
•
|
increases of $8.3 million and $31.1 million for the
three and nine
months ended
September 30, 2016
, respectively, primarily due to the addition of the 12 modern Suezmax tankers which we acquired in the second half of 2015 which were partially offset by the sales of the one MR tanker in the third quarter of 2016 and one MR tanker in the fourth quarter of 2015;
|
•
|
increases of $0.9 million and $17.6 million for the
three and nine
months ended
September 30, 2016
, respectively, due to additional expenditures directly related to the STS business acquired in the third quarter of 2015; and
|
•
|
increases of $0.5 million and $1.8 million for the
three and nine
months ended
September 30, 2016
, respectively, due to ship management fees relating to the 12 vessels acquired in the second half of 2015;
|
•
|
a decrease of $0.8 million for the nine months ended
September 30, 2016
due to lower fleet overhead costs resulting from the timing of crew training initiatives; and
|
•
|
decreases of $0.2 million and $0.6 million for the three and nine months ended
September 30, 2016
, respectively, due to lower insurance premiums paid and insurance credits received.
|
•
|
a net decrease of $0.8 million for the three months ended
September 30, 2016
, primarily as a result of higher legal expenses incurred in the three months ended September 30, 2015 related to the STX arbitration; and
|
•
|
a net decrease of $0.2 million for the three months ended
September 30, 2016
, due to lower administrative, strategic management and other fees incurred;
|
•
|
a net increase of $0.4 million for the three months ended
September 30, 2016
, primarily due to higher general and administrative expenses related to the STS transfer business which we acquired in July 2015.
|
•
|
a net increase of $1.5 million for the nine months ended
September 30, 2016
due to additional general and administrative expenses related to the STS transfer business which we acquired in July 2015;
|
•
|
a net increase of $0.8 million for the nine months ended
September 30, 2016
as a result of higher corporate expenses incurred during the first quarter of 2016, primarily as a result of legal expenses related to financing activities and the STX arbitration (please read Item 1 - Financial Statements: Note
15
- Shipbuilding Contracts); and
|
•
|
a net increase of $0.5 million for the nine months ended
September 30, 2016
due to higher administrative, strategic management and other fees incurred.
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
|
September 30, 2016
|
|
September 30, 2015
|
|
September 30, 2016
|
|
September 30, 2015
|
||||
(in thousands of U.S. dollars)
|
|
$
|
|
$
|
|
$
|
|
$
|
||||
High-Q Joint Venture
|
|
894
|
|
|
663
|
|
|
3,425
|
|
|
2,036
|
|
Tanker Investments Ltd.
|
|
(325
|
)
|
|
1,083
|
|
|
3,181
|
|
|
4,497
|
|
Teekay Tanker Operations Ltd.
|
|
476
|
|
|
1,016
|
|
|
2,993
|
|
|
2,398
|
|
Total equity income
|
|
1,045
|
|
|
2,762
|
|
|
9,599
|
|
|
8,931
|
|
•
|
an increase of $1.4 million for the nine months ended September 30, 2016 from our High-Q joint venture primarily resulting from a profit share recognized in the second quarter of 2016 as VLCC rates averaged above certain thresholds, triggering a profit sharing with the customer; and
|
•
|
an increase of $0.6 million for the nine months ended
September 30, 2016
due to higher equity earnings from our 50% interest in Teekay Tankers Operations Ltd. (
TTOL
), primarily related to our share of cancellation fees paid to Anglo-Eastern during the first quarter of 2015 for acquiring its 49% share in Teekay Marine Ltd.;
|
•
|
decreases of $1.4 million and $1.3 million for the three and nine months ended September 30, 2016, respectively, primarily due to lower equity earnings from TIL resulting from lower average realized spot rates earned, partially offset by an increase in our ownership in TIL from 9.40% to 11.30% during the first half of 2016 and the fourth quarter of 2015; and
|
•
|
a decrease of $0.5 million for the three months ended September 30, 2016, primarily due to lower equity earnings from TTOL resulting from overall lower average realized spot rates earned.
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||
|
|
September 30, 2016
|
|
September 30, 2015
|
|
September 30, 2016
|
|
September 30, 2015
|
||||
(in thousands of U.S. dollars)
|
|
$
|
|
$
|
|
$
|
|
$
|
||||
Interest expense
|
|
(6,809
|
)
|
|
(4,008
|
)
|
|
(22,421
|
)
|
|
(9,659
|
)
|
Interest income
|
|
18
|
|
|
28
|
|
|
70
|
|
|
67
|
|
Realized and unrealized gain (loss) on derivative instruments
|
|
3,629
|
|
|
(1,031
|
)
|
|
(7,902
|
)
|
|
(2,095
|
)
|
Other income (expense)
|
|
453
|
|
|
(1,385
|
)
|
|
(4,133
|
)
|
|
(1,838
|
)
|
|
|
Nine Months Ended
|
||||
|
|
September 30, 2016
|
|
September 30, 2015
|
||
(in thousands of U.S. dollars)
|
|
$
|
|
$
|
||
Net cash flow provided by operating activities
|
|
181,455
|
|
|
144,837
|
|
Net cash flow (used for) provided by financing activities
|
|
(243,485
|
)
|
|
574,450
|
|
Net cash flow provided by (used for) investing activities
|
|
24,850
|
|
|
(801,505
|
)
|
•
|
a $44.5 million increase in operating cash inflows primarily due to the timing of the settlement of operating assets and liabilities; and
|
•
|
a $11.3 million decrease in operating cash outflows relating to lower dry-docking costs incurred in the nine months ended
September 30, 2016
, compared to the same period in
2015
;
|
•
|
a net decrease of $19.2 million in operating earnings, primarily as a result of lower realized spot rates earned, partially offset by an increase in our fleet size due to the acquisition of 12 Suezmax tankers, four LR2 product tankers and one Aframax tanker.
|
•
|
a net increase in cash outflows of $563.8 million as 2015 included new term facilities to finance the acquisition of 12 Suezmax tankers, four LR2 product tankers and one Aframax tanker and due to the 2016 refinancing of our long-term debt facilities in addition to repayments and prepayments on our current term loans and revolving credit facilities;
|
•
|
a decrease of $228.0 million in cash inflows related to the 2015 issuances of shares under private placements to partially fund the acquisition of 12 Principal Maritime vessels and the ship-to-ship transfer business in 2015, our continuous offering program (or
COP
) we launched in June 2015 and proceeds from an issuance in January 2015 of an additional 3.0 million shares of Class A common stock; and
|
•
|
an increase in cash outflows of $31.6 million due to additional cash dividends paid during the nine months ended
September 30, 2016
, as a result of the change in our dividend policy and the increase in the number of our shares of outstanding Class A and B common stock from issuances of our shares in 2015;
|
•
|
a net decrease of $5.5 million in cash outflows related to the financing activities from the Entities under Common Control.
|
•
|
a net decrease of $750.0 million in cash outflows related to the acquisition of 12 modern Suezmax tankers in the third quarter of 2015 and four LR2 product tankers and one Aframax tanker in the first quarter of 2015 and other capital expenditures;
|
•
|
a decrease of $45.6 million in cash outflows related to our acquisition of the STS business in the third quarter of 2015;
|
•
|
an increase of $15.2 million in cash inflows primarily related to the return of capital in 2016 from our investment in TTOL;
|
•
|
an increase of $14.1 million in cash inflows related to the sale of one MR product tanker in the third quarter of 2016; and
|
•
|
an increase of $1.5 million in cash inflows related to the 2016 repayment of a loan to us from our High-Q joint venture.
|
|
|
|
Remainder of
|
|
|
|
|
|
|
|
|
Beyond
|
|||||||||
(in millions of U.S. dollars)
|
Total
|
2016
|
2017
|
2018
|
2019
|
2020
|
2021
|
||||||||||||||
U.S. Dollar-Denominated Obligations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Scheduled repayments of revolving facilities, term loans and other debt
(1)
|
520.2
|
|
|
60.8
|
|
|
125.0
|
|
|
111.8
|
|
|
110.0
|
|
|
110.0
|
|
|
2.6
|
|
|
Repayments at maturity of revolving facilities, term loans and other debt
(1)
|
456.0
|
|
|
—
|
|
|
49.1
|
|
|
65.5
|
|
|
—
|
|
|
—
|
|
|
341.4
|
|
|
Chartered-in vessels (operating leases)
(2)
|
56.9
|
|
|
9.9
|
|
|
20.7
|
|
|
8.3
|
|
|
8.3
|
|
|
8.3
|
|
|
1.4
|
|
|
Total
|
1,033.1
|
|
|
70.7
|
|
|
194.8
|
|
|
185.6
|
|
|
118.3
|
|
|
118.3
|
|
|
345.4
|
|
|
(1)
|
Excludes expected interest payments of
$5.7 million
(remaining in
2016
),
$20.4 million
(
2017
),
$16.7 million
(
2018
),
$13.4 million
(
2019
),
$10.6 million
(
2020
) and
$4.6 million
(beyond
2021
). Expected interest payments are based on the existing interest rates for variable-rate loans at LIBOR plus margins that range from
0.30%
to
2.00%
at
September 30, 2016
. The expected interest payments do not reflect the effect of related interest rate swaps that we have used to hedge certain of our floating-rate debt.
|
(2)
|
Excludes payments required if we execute all options to extend the terms of in-chartered leases signed as of
September 30, 2016
. If we exercise all options to extend the terms of signed in-chartered leases, we would expect total payments of
$9.9 million
(remaining in
2016
),
$34.6 million
(
2017
),
$17.2 million
(
2018
),
$8.3 million
(
2019
),
$8.3 million
(
2020
) and
$1.4 million
(beyond
2021
).
|
•
|
the timing and certainty of our future growth prospects and opportunities, including any future vessel acquisitions;
|
•
|
our financial position and ability to take advantage of growth opportunities in the global conventional tanker market;
|
•
|
the crude oil and refined product tanker market fundamentals, including the balance of supply and demand in the tanker market, estimated growth in the world tanker fleet, estimated growth in global oil demand and crude oil tanker demand, and changes in spot tanker rates;
|
•
|
the expected delivery dates for our tankers in-chartered, out-chartered, and pending sale;
|
•
|
expected contract commencement and termination dates;
|
•
|
future oil prices, production and refinery capacity;
|
•
|
future crude tanker rates;
|
•
|
tanker fleet utilization, including our ability to secure new fixed-rate time-charter out agreements;
|
•
|
the effectiveness of our chartering strategy in capturing upside opportunities and reducing downside risks, including our ability to take advantage of a tanker market recovery;
|
•
|
our ability to generate surplus cash flow and pay dividends from our existing vessel fleet or from any potential vessel acquisitions;
|
•
|
the expected range of our quarterly adjusted net income to be paid as quarterly dividends;
|
•
|
the primary sources and sufficiency of funds needed to meet our short-term liquidity requirements;
|
•
|
our compliance with, and the effect on our business and operating results of, covenants under our term loans and credit facilities;
|
•
|
planned capital expenditures and the ability to fund capital expenditures;
|
•
|
the impact of the SPT acquisition on us and our results of operations, including on the Company's fee-based revenue and fleet utilization;
|
•
|
the ability of TIL to benefit from the cyclical tanker market;
|
•
|
our expectations regarding payments made on behalf of our co-obligors in connection with the loan arrangements in which certain other subsidiaries of Teekay are also borrowers;
|
•
|
continued material variations in the period-to-period fair value of our derivative instruments;
|
•
|
our expectations regarding uncertain tax positions;
|
•
|
the outcome of legal action against STX; and
|
•
|
our hedging activities relating to foreign exchange, interest rate and spot market risks.
|
(1)
|
Rate refers to the weighted-average effective interest rate for our long-term debt, including the margin we pay on our variable-rate.
|
(2)
|
Interest payments on U.S. Dollar-denominated debt and interest rate swaps are based on LIBOR. The average variable rate paid to us under our interest rate swaps is set quarterly at the six-month and three-month LIBOR, respectively.
|
|
|
|
|
TEEKAY TANKERS LTD.
|
|
|
|
|
|
||
Date:
|
November 28, 2016
|
|
|
By:
|
/s/ Vincent Lok
|
|
|
|
|
Vincent Lok
Chief Financial Officer
(Principal Financial and Accounting Officer)
|
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