Teekay Tankers Ltd. · NYSE:TNK
Teekay Tankers — Q3 2020 Earnings Presentation
17 slides from Teekay Tankers's earnings presentation, Nov 12, 2020
Slide 1: Teekay Tankers Q3-2020 Earnings Presentation
Teekay Tankers Q3-2020 Earnings Presentation November 12, 2020
Slide 2: Forward Looking Statement
Forward Looking Statement This presentation 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, among other things, statements reg
Slide 3: Recent Highlights
Recent Highlights Q3-20 Results Strong Balance Sheet Tanker Market Total adjusted EBITDA(1) of $46.2 Generated $31.2 million of free Spot rates weakened in Q3-20 million, up $18.4 million from Q3-19 cash flow(1) in Q3-20 compared to 1H-20 due to knock-on effects of COVID-19 Adjusted net income(1) of
Slide 4: Tanker Spot Rates Have Weakened After Three Strong Quarters
Tanker Spot Rates TNK Q3 Rates Benchmark Mid-Size Tanker Spot Rates Have Weakened After Three Strong Quarters Spot Rate Total Rate (Incl TCs) (1) Suezmax Aframax 35 100 Spot rates declined during Q3- 20 due to the knock-on $29,400 90 30 impacts of COVID-19: 80 • High oil inventory levels 25 • OPEC s
Slide 5: Q4-20 To-Date Charter Rates
Q4-20 To-Date Charter Charter Rates Rates 35,000 $29,400 30,000 Combined spot and fixed rate time charters for Q4-20: 25,000 $24,200 Rate ($/day) • 62% of Suezmax days fixed at an 20,000 average rate of $24,200 per day $15,900 $15,600 15,000 $13,500 • 54% of Aframax days fixed at an $12,400 average
Slide 6: Tanker Demand on the Path to Recovery
Tanker Demand on Global Oil Market Balance the Path to Recovery Stock Change Demand Supply Gradual recovery in the 12 102 coming months as demand increases and global oil 10 9.3 100 inventories are drawn down 8 98 MB/D (Stock Change) Oil demand has recovered 6.4 MB/D (Supply / Demand) sharply since
Slide 7: Shrinking Orderbook, Aging Fleet Sets the Stage for a Recovery
Shrinking Orderbook, Aging Fleet Sets the Tanker Orderbook vs. Average Fleet Age Stage for a Recovery Avg. Fleet Age Orderbook as % of Fleet Tanker fleet set for an extended period of low 70% 14 growth in the next 2-3 years 60% 13 The tanker orderbook, when measured as a percentage of the existing f
Slide 8: Strong Financial Position to Weather Potential Headwinds
Strong Financial Net Debt(2) Liquidity 1000 500 Position to Weather Potential Headwinds 800 400 $ Millions $ Millions Over the last 12 months, 600 300 generated over $400 million of 997 470 free cash flow(1) and completed 400 200 over $100 million of asset 502 sales 200 100 95 • Net debt(2) reduced
Slide 9: Appendix
Appendix 9
Slide 10: Low Breakeven with Significant Operating Rate Sensitivity
Low Breakeven with Adjusted Net Income Spot FCF(2)(3) Spot Rate Sensitivity Significant Operating Rate Sensitivity Next-12- Next-12-Months(1) Leverage Months(1) $800 $800 $700 $700 $600 $600 $500 $500 $ millions $ millions $400 $400 $300 $300 $200 $200 $100 $100 $0 $0 5,000 5,000 10,000 15,000 20,00
Slide 11: Fleet Employment – In-Charters
400 Fleet Employment – In-Charters(1) 300 Ship Days 200 100 - Q4-2020 Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Q3-2022 Q4-2022 Aframax/LR2 Days 368 183 91 68 - - - - - Aframax/LR2 Rates 21,188 21,471 21,000 21,000 - - - - Aframax/LR2 Days (1) Based on existing charters excluding extension opt
Slide 12: Fleet Employment – Out-Charters
700 Fleet Employment – Out-Charters(1) 600 500 Ship Days 400 300 200 100 - Q4-2020 Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Q3-2022 Q4-2022 Suezmax Days 579 450 132 - - - - - - Aframax/LR2 Days 410 369 301 276 188 180 103 - - Suezmax Rates 43,626 45,600 45,174 - - - - - - Aframax/LR2 Rates 24
Slide 13: Q4-20 Outlook
Q4-20 Outlook Income Statement Item Q4-20 Outlook(1) (expected changes from Q3-20) Decrease of approximately 160 net revenue days, mainly due to more dry dockings in Q4-20 compared to Q3-20. Revenues Refer to Slide 5 for Q4-20 booked to-date spot and fixed tanker rates. Vessel operating expenses Dec
Slide 14: Adjusted Net Income
Adjusted Net (In thousands of U.S. dollars) Income(1) Q3-2020 Q2-2020 Q3-20 vs Q2-20 Statement Item (unaudited) (unaudited) Variance Comments Decrease primarily due to lower overall spot TCE rates in Q3-20, as well as more scheduled Revenues 170,056 246,292 (76,236) dry dockings and off-hire days in
Slide 15: Consolidated Adjusted Statement of Income
Consolidated Adjusted Statement of (In thousands of U.S. dollars) Income Statement Item As Reported Appendix A Reclassification for As Adjusted Q3-20 Items (1) Realized Gain/ Loss on Derivatives Revenues 170,240 - (184) 170,056 Voyage expenses (57,777) - - (57,777) Vessel operating expenses (46,336)
Slide 16: Drydock & Off-hire Schedule
Drydock & Off-hire Schedule(1)(2)(3) March 31, 2020 June 30, 2020 September 30, 2020 December 31, 2020 Total 2020 Total 2021 Teekay Tankers (Actual) (Actual) (Actual) (Estimate) (Estimate) (Estimate) Total Total Total Total Total Total Vessels Off-hire Vessels Off-hire Vessels Off-hire Vessels Off-h
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