Teekay Tankers Ltd. · NYSE:TNK
Teekay Tankers — Q2 2015 Earnings Presentation
15 slides from Teekay Tankers's earnings presentation, Aug 6, 2015
Slide 1: Teekay Tankers Q2-2015 Earnings Presentation
TEEKAY TEEKAY TEEKAY TANKERS Q2-2015 EARNINGS PRESENTATION August 6, 2015
Slide 2: Forward Looking Statements
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 pending acqui
Slide 3: Recent Highlights
Recent Highlights • Q2-2015 Financial Results ○ Generated adjusted net income1 of $41.3 million, or $0.35 per share versus net loss of $4.1 million or $0.05 per share in Q2-2014 ○ Generated free cash flow1 of $57.9 million, or $0.50 per share versus $9.2 million or $0.11 per share in Q2-2014 • Strat
Slide 4: Acquisition of Principal Maritime Suezmax Fleet Provides Strategic Benefits
Acquisition of Principal Maritime Suezmax Fleet Provides Strategic Benefits • Acquisition at the right point in the cycle increases operating leverage and enables TNK to take advantage of the strong spot tanker market • Accretive to earnings, free cash flow and net asset value per share • Enhances s
Slide 5: The Changing Dynamics of Suezmax Trade
The Changing Dynamics of Suezmax Trade Increasing diversity of supply sources expected to further stretch fleet Suezmax Trade Development 2012-15 Trade Growth Trade Decline Significant decline in WAF-US volumes due to rise in US shale oil production Increase in Suezmax loadings European refiners ex-
Slide 6: Moderate Fleet Growth into 2017
Moderate Fleet Growth into 2017 Fleet growth in 2016 / 17 manageable despite recent orders Crude Tanker Fleet Growth Suezmax Fleet Growth 200 50 10% 10% 40 8% 150 8% Number of Vessels 30 6% Number of Vessels % Fleet Growth 100 6% % Fleet Growth 20 4% 4% 50 10 2% 2% 0 0% 0 0% -2% -10 -2% -50 -4% -20
Slide 7: Acquisition of Ship-to-ship Transfer Business
Acquisition of Ship-to-ship Transfer Business • In late-July 2015, TNK acquired 100% interest in SPT Inc. for a purchase price of $45.5 million ○ Establishes TNK as a global player in the ship-to-ship transfer business ○ Increases overall fleet utilization through improved scheduling efficiencies ○
Slide 8: Acquisition Financing and Accretion
Acquisition Financing and Accretion • Aggregate purchase price of ~$708 million for Principal Maritime fleet and SPT Inc. fully financed by: ○ ~$400 million new debt facility to be completed in August 2015 ○ $223 million of new equity, including a combined $125.5 million to the sellers and Teekay Co
Slide 9: Counter-Seasonally Strong Spot Rates
Counter-Seasonally Strong Spot Rates • Spot rates averaged significantly higher year-on-year in Q2-2015 • Counter-seasonal strength driven by high oil supply, positive fleet fundamentals, changing trade patterns, and ongoing storage programs will continue to Q3-2015 $45,000 $40,500 $39,400 $38,800 $
Slide 10: Freight Market to Remain Strong in 2H-2015
Freight Market to Remain Strong in 2H-2015 Low oil prices, high oil production and rising demand supporting tanker rates 2015 IEA Oil Demand Forecast Global Crude Oil Supply and Demand 1.5 97 Demand Supply 1.4 96 1.3 95 1.2 Mb/d Mb/d 1.1 94 1.0 93 0.9 92 0.8 0.7 91 Jan-15 Feb-15 Mar-15 Apr-15 May-15
Slide 11: Delivering Shareholder Value
Delivering Shareholder Value Executing company strategy using variety of levers Strategy Levers Execution • Actively pursue in-charters while • Established a portfolio of 12 in- managing out-charter portfolio charters which contributed to increase in spot exposure to 85% • Utilize TNK’s operating pl
Slide 12: Appendix
APPENDIX 12
Slide 13: Suezmax Vessels to be Acquired by TNK
Suezmax Vessels to be Acquired by TNK No. Vessel Name Charter-out Yard DWT Year Current Expiry Built Age 1 Princimar Courage Samsung 158,000 2013 2 2 Princimar Pride Dec-15 Samsung 158,000 2012 3 3 Princimar Integrity Samsung 158,000 2012 3 4 Princimar Grace Samsung 158,000 2011 4 5 Princimar Hope S
Slide 14: Fleet Employment Profile
Fleet Employment Profile In-Charter Portfolio Aframax $16,750 Aframax $18,600 Aframax $15,750 Optional Period (1) Aframax $12,000 Optional Period Aframax $15,600 Aframax $22,000 Aframax $22,000 Optional Period Aframax $18,900 Optional Period LR2 $16,250 LR2 $16,400 (2) LR2 $20,500 Optional Period Ou
Slide 15: TNK 2015 Drydock & Offhire Schedule
TNK 2015 Drydock & Offhire Schedule Teekay Tankers March 31, 2015 (A) June 30, 2015 (A) September 30, 2015 (E) December 31, 2015 (E) Total 2015 Total 2016 Total Total Total Total Total Total Vessels Off-hire Vessels Off-hire Vessels Off-hire Vessels Off-hire Vessels Off-hire Vessels Off-hire Segment