Teekay Tankers Ltd. Reports Fourth Quarter and Annual 2015 Results
(firmenpresse) - HAMILTON, BERMUDA -- (Marketwired) -- 02/18/16 -- Highlights
Teekay Tankers Ltd. (Teekay Tankers or the Company) (NYSE: TNK) today reported adjusted net income attributable to its shareholders(1) of $48.5 million, or $0.31 per share, for the quarter ended December 31, 2015, compared to $18.6 million, or $0.21 per share, for the same period in the prior year. The increase is primarily due to stronger spot tanker rates in the fourth quarter of 2015 compared to the same period in the prior year and an increase in fleet size related to the acquisition of 17 modern, mid-size tankers during 2015 and the expansion of the Company''s chartered-in tanker portfolio in 2014 and 2015. Adjusted net income attributable to shareholders excludes a number of specific items that had the net effect of increasing net income attributable to shareholders by $3.9 million, or $0.03 per share, and by $1.7 million, or $0.01 per share, for the three months ended December 31, 2015 and 2014, respectively, as detailed in Appendix A to this release. Including these items, the Company reported, on a GAAP basis, net income attributable to its shareholders of $52.5 million, or $0.34 per share, and $20.3 million, or $0.22 per share, for the three months ended December 31, 2015 and 2014, respectively. Net revenues(3) were $159.3 million and $77.4 million for the three months ended December 31, 2015 and 2014, respectively.
During the fourth quarter of 2015, the Company generated $74.0 million, or $0.48 per share, of free cash flow(2), compared to $31.7 million, or $0.35 per share, in the fourth quarter of 2014, with the increase due to higher average spot rates earned and an increase in the size of the Company''s fleet. On December 14, 2015, Teekay Tankers declared a dividend of $0.12 per share for the fourth quarter of 2015, which was paid on February 12, 2016 to all shareholders of record on February 2, 2016. Since the Company''s inception, it has declared dividends in 33 consecutive quarters.
CEO Commentary
"During the quarter, Teekay Tankers generated strong free cash flow of $74.0 million, or $0.48 per share, recording one of Teekay Tankers'' strongest quarters ever," commented Kevin Mackay, Teekay Tankers'' Chief Executive Officer. "In addition, we announced and implemented our new dividend policy, under which we intend to pay out to our shareholders 30 to 50 percent of the Company''s quarterly adjusted net income, while maintaining a minimum quarterly dividend of $0.03 per share. This resulted in a 300 percent increase in our quarterly cash dividend to $0.12 per share for the fourth quarter of 2015. The new dividend policy provides long-term investors the opportunity to directly benefit from the Company''s strong earnings while continuing to de-lever our balance sheet, which increases the Company''s net asset value and further strengthens our financial position."
"We are also pleased to announce the acquisition of two modern purpose-built Lightering Aframax tankers in December 2015, which complements our recent ship-to-ship transfer acquisition of SPT Inc. and further expands our strategic presence in the U.S. Gulf."
Mr. Mackay continued, "We expect that many of the positive tanker market fundamentals in 2015 will remain in place during 2016, including growing oil demand, high crude oil supply from OPEC, low oil prices, manageable tanker supply growth, ongoing strategic and commercial oil stockpiling, and high refinery throughput. In addition, we expect the recent approval of U.S. crude exports will result in the development of new trade routes and positive demand growth for mid-sized tankers, directly benefiting Teekay Tankers as the world''s largest owner and operator in this segment. As well as the expected rise over time of U.S. exports to Europe and Asia via the expanded Panama Canal, which is scheduled to be completed in June 2016, the lifting of the export ban and the resultant narrowing of the WTI/Brent crude oil spread could give rise to increased imports into the U.S. An increase in both U.S. imports and exports of oil is expected to drive demand for mid-size tankers and ship-to-ship transfer services."
Mr. Mackay added "With an owned and chartered-in fleet of approximately 55 modern mid-size tankers and the recent completion of two key financial initiatives, including our new $900 million long-term debt facility and our new dividend policy, we believe Teekay Tankers and its shareholders are well-positioned to benefit from what we anticipate to be a continued strong tanker market."
Summary of Recent Developments
New Dividend Policy
In December 2015, Teekay Tankers announced a new dividend policy under which the Company intends to pay out 30 to 50 percent of its quarterly adjusted net income, with a minimum quarterly dividend of $0.03 per share, subject to any reserves determined to be required by the Company''s Board of Directors. The new dividend policy will provide investors the opportunity to participate in earnings from the tanker market while enabling the Company to continue to de-lever its balance sheet. Teekay Tankers implemented this new dividend policy for the fourth quarter of 2015, increasing its quarterly cash dividend to $0.12 per share, which was paid on February 12, 2016.
Expanding Strategic Presence in U.S. Gulf
During the fourth quarter, Teekay Tankers built on its recent ship-to-ship transfer acquisition of SPT Inc. and expanded its U.S. Gulf presence through the acquisition and chartering-in of three purpose-built Lightering Aframax tankers. On December 18, 2015, the Company acquired two Lightering Aframax tankers, the SPT Explorer and Navigator Spirit, from Teekay Offshore Partners L.P. (Teekay Offshore) for an aggregate purchase price of $80 million and chartered-in for five years another Lightering Aframax tanker, which is scheduled to deliver between February and March 2016. The acquisition was fully financed through the assumption of an approximately $50 million revolving credit facility from Teekay Offshore and the Company''s existing liquidity. These transactions are expected to be immediately accretive to Teekay Tankers'' earnings and free cash flow per share.
New Debt Facility
In January 2016, Teekay Tankers completed a new five-year $900 million long-term debt facility, which was 1.4 times oversubscribed. The new facility includes term loan and revolving credit facility components which were used to refinance 36 of the Company''s existing vessels (including 17 vessels acquired during 2015 that were financed with two bridge loan facilities that matured in early-2016, and other vessels previously financed with the Company''s primary revolving credit facility which was scheduled to mature in 2017). This new facility extends the Company''s debt maturity profile and provides financial flexibility in the future.
Tanker Market
The tanker market in 2015 was the strongest since 2008. The main catalyst for the market strength was continued high levels of global oil production, including an extra 1.0 million barrels per day (mb/d) of crude oil supply from OPEC. Global oil demand was also robust in 2015, growing by 1.7 mb/d, the highest level of growth since the post-financial crisis rebound in 2010. Oil prices fell in 2015 to the lowest average price in 11 years, which was positive for the tanker market as it led to higher refinery throughput to take advantage of strong refining margins, increased commercial and strategic stockpiling of oil, and lower bunker fuel costs for ship owners. Finally, tanker fleet growth remained low with just 2 percent growth in the crude tanker fleet during 2015.
The fourth quarter of 2015 was particularly strong, led by the large crude tanker sectors. This strength was driven by firm underlying fundamentals coupled with seasonal and one-off factors. The fourth quarter saw the onset of winter weather delays, including an increase in transit time through the Turkish Straits and fog in the US Gulf. Ullage-related delays resulted in increased waiting times at discharge ports due to logistical constraints, which further added to rate volatility during the fourth quarter.
Looking ahead, the Company anticipates that many of the positive fundamentals which existed in 2015 will continue during 2016. Global oil demand is forecast to grow by 1.3 mb/d in 2016 (based on the average of IEA, EIA, and OPEC forecasts). While this is a decrease from 2015 oil demand growth of 1.7 mb/d, it is above the average growth rate of 1.0 mb/d over the last decade. Global oil production is anticipated to remain high with no change to OPEC policy expected in 2016. In addition, the return of Iranian production is projected to add up to 0.5 mb/d of supply in 2016, further increasing global crude oil exports and keeping oil prices relatively low. Finally, while tanker fleet growth is set to increase in 2016, the tanker fleet growth is relatively modest for the mid-size sectors with anticipated tanker fleet growth of 4.5 percent and 4.0 percent in the Suezmax and Aframax/LR2 fleets, respectively, which compares favorably to the average fleet growth in the last decade of approximately 5.0 percent per annum. Furthermore, the fleet growth is weighted towards the second half of the year and thus, the full impact should be felt more in 2017 than in 2016.
In addition to positive supply and demand fundamentals, changing trade patterns are expected to benefit the mid-size tanker sectors in 2016. Although it is not expected to immediately translate into an influx of U.S. crude oil into global markets, the relaxation of the U.S. crude oil export ban is already resulting in an increase in European and West African imports to the U.S. Atlantic coast. The spread between the West Texas Intermediate (WTI) and Brent oil price has narrowed enough to make seaborne transportation of oil to the U.S. more economical than rail or truck transportation within the U.S. from domestic producers. Mid-sized tanker markets could also benefit from the expansion of the Panama Canal, which is scheduled to be completed in June 2016, as it will facilitate trade movements between the Atlantic and the Pacific, including crude and condensate exports from the U.S. Gulf to Asian markets.
Overall, the Company expects that 2016 will be a strong year for crude tanker fundamentals driven by high levels of global oil supply, rising oil demand, low oil prices, changing trade routes, and a manageable level of fleet growth.
Operating Results
The following table highlights the operating performance of the Company''s time-charter vessels and spot vessels trading in pools measured in net voyage revenue per revenue day, or time-charter equivalent (TCE) rates, before related-party pool management fees, related-party commissions and off-hire bunker expenses:
Teekay Tankers'' Fleet
The following table summarizes the Company''s fleet as of February 5, 2016 (including a committed chartered-in vessel yet to be delivered):
Liquidity and Continuous Offering Program Update
In November 2015, the Company implemented a new continuous offering program (COP) under which the Company may issue new common shares at market prices up to a maximum aggregate amount of $80 million. During the fourth quarter of 2015, the Company sold an aggregate of 2,045,000 common shares under the COP at an average price of $7.14 per share, generating net proceeds of approximately $14.3 million.
As of December 31, 2015, the Company had total liquidity of $111.0 million (comprised of $96.4 million in cash and cash equivalents and $14.6 million in undrawn revolving credit facilities), compared to total liquidity of $206.2 million as at September 30, 2015. The decrease in the Company''s liquidity position during the fourth quarter was primarily due to vessel acquisitions, a scheduled amortization on one of the Company''s corporate revolving credit facilities, drydocking costs, and working capital timing differences.
Conference Call
The Company plans to host a conference call on Friday, February 19, 2016 at 11:00 a.m. (ET) to discuss its results for the fourth quarter and fiscal year of 2015 and the Company''s business outlook. An accompanying investor presentation will be available on Teekay Tankers'' website at prior to the start of the call. All shareholders and interested parties are invited to listen to the live conference call by choosing from the following options:
The conference call will be recorded and available until Friday, March 4, 2016. This recording can be accessed following the live call by dialing (888) 203-1112 or (647) 436-0148, if outside North America, and entering access code 8972345.
About Teekay Tankers
Teekay Tankers currently owns a fleet of 45 double-hull tankers, including 22 Suezmax tankers, 14 Aframax tankers, 7 Long Range 2 (LR2) product tankers and 2 Medium-Range (MR) product tankers, and has 12 contracted time charter-in tankers. Teekay Tankers'' vessels are employed through a mix of short- or medium-term fixed rate time charter contracts and spot tanker market trading. The Company also owns a Very Large Crude Carrier (VLCC) through a 50 percent-owned joint venture. In addition, Teekay Tankers owns a ship-to-ship transfer business and a minority interest of approximately 10 percent in Tanker Investments Ltd. (OSE: TIL), which currently owns a fleet of 18 modern tankers. Teekay Tankers was formed in December 2007 by Teekay Corporation as part of its strategy to expand its conventional oil tanker business.
Teekay Tankers'' common stock trades on the New York Stock Exchange under the symbol "TNK."
Teekay Tankers Ltd.
Summary Consolidated Statements of Income
(in thousands of U.S. dollars, except share and per share data)
Components of equity income are detailed in the table below:
Teekay Tankers Ltd.
Summary Consolidated Balance Sheets
(in thousands of U.S. dollars)
Teekay Tankers Ltd.
Summary Consolidated Statements of Cash Flows
(in thousands of U.S. dollars)
Teekay Tankers Ltd.
Appendix A - Specific Items Affecting Income
(in thousands of U.S. dollars, except per share amounts)
Set forth below is a reconciliation of the Company''s unaudited adjusted net income attributable to the shareholders of Teekay Tankers, a non-GAAP financial measure, to net income as determined in accordance with GAAP. The Company believes that, in addition to conventional measures prepared in accordance with GAAP, certain investors use this information to evaluate the Company''s financial performance. The items below are also typically excluded by securities analysts in their published estimates of the Company''s financial results. Adjusted net income attributable to the shareholders of Teekay Tankers is intended to provide additional information and should not be considered a substitute for measures of performance prepared in accordance with GAAP.
Teekay Tankers Ltd.
Appendix B - Reconciliation of Non-GAAP Financial Measure
Free Cash Flow
(in thousands of U.S. dollars, except share and per share data)
Free cash flow (FCF) represents net income, plus depreciation and amortization, unrealized losses from derivatives, non-cash items, FCF from the equity accounted investments and any write-offs or other non-recurring items, less unrealized gains from derivatives, equity income from the equity accounted investments, net income attributable to the Entities under Common Control and other non-cash items.
Teekay Tankers LTD.
Appendix C - Reconciliation of Non-GAAP Financial Measure
Net Revenues
(in thousands of U.S. dollars)
Net revenues represents revenues less voyage expenses where voyage expenses are comprised of all expenses relating to certain voyages, including bunker fuel expenses, port fees, cargo loading and unloading expenses, canal tolls, agency fees and commissions. Net revenues is a non-GAAP financial measure used by certain investors to measure the financial performance of shipping companies; however, it is not required by GAAP and should not be considered as an alternative to revenues or any other indicator of the Company''s performance required by GAAP.
Forward Looking Statements
This release contains forward-looking statements (as defined in Section 21E of the Securities Exchange Act of 1934, as amended) which reflect management''s current views with respect to certain future events and performance, including statements regarding: the Company''s future dividend payout ratio and anticipated benefits of the new dividend policy; accretion to the Company''s earnings and free cash flow from the acquisition and chartering-in of lightering Aframax tankers; the impact of the U.S. government''s decision to lift the ban on crude oil exports and of the scheduled opening of the expanded Panama Canal, including the establishment of new trade routes for mid-size tankers; 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, crude oil tanker demand and OPEC crude oil supply; tanker fleet utilization and spot tanker rates; the effect of lower global oil prices, including the potential impact on oil stockpiling, refinery throughput and bunker fuel prices; the impact of the tanker market on the Company''s earnings, free cash flow, net asset value and future dividends; the delivery date of one chartered-in Aframax tanker; and the impact on the financial flexibility as a result of the new debt facility.
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 the production of, or demand for, oil or refined products; changes in trading patterns significantly affecting overall vessel tonnage requirements; greater or less than anticipated levels of tanker newbuilding orders and deliveries and greater or less than anticipated rates of tanker scrapping; changes in global oil prices; market reactions to changes in the U.S. crude oil export positions and expansion of the Panama Canal; revenues and costs related to the Company''s lightering Aframax tankers; changes in applicable industry laws and regulations and the timing of implementation of new laws and regulations; the amount of cash reserves established by the Company''s Board of Directors; actual dividend payout ratios determined by the Company''s Board of Directors; increased costs; and other factors discussed in Teekay Tankers'' filings from time to time with the United States Securities and Exchange Commission, including its Report on Form 20-F for the fiscal year ended December 31, 2014 and on Form 6-K for the quarters ended March 31, 2015, June 30, 2015 and September 30, 2015. 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.
Contacts:
Investor Relations Enquiries
Ryan Hamilton
+1 (604) 844-6654
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Datum: 18.02.2016 - 05:43 Uhr
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