Slide 1: First Quarter Earnings Presentation
TEEKAY CORPORATION First Quarter Earnings Presentation May 13, 2010 www.teekay.com
Slide 2: Forward Looking Statements
Forward Looking Statements 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 statements regarding: tanker marke
Slide 3: First Quarter Highlights
First Quarter Highlights f Adjusted net loss attributable to Teekay of $3.9m, or $0.05 per share(1), improved from $0.45 per share loss in Q4-09 f Q1-10 adjusted net loss excludes $30m, or $0.41 per share, catch-up payment related to Foinaven contract amendment f Generated $203.8m of cash flow from
Slide 4: Profitability Focus Delivering Improved Results
Profitability Focus Delivering Improved Results Teekay Adj. Net Income Per Share (Consolidated) $0.20 $20,000 Average Aframax Spot Rate* Adj. Net Income Per Share $0.00 $16,000 RHS ($0.20) $12,000 ($0.40) $8,000 LHS ($0.60) $4,000 ($0.80) $0 Q2-09 Q3-09 Q4-09 Q1-10 f Improving profitability driven b
Slide 5: Progress in Teekay's Offshore Business
Progress in Teekay’s Offshore Business f Significant developments in FPSO business f Amended Foinaven FPSO contract will provide $30 - $40m of incremental cash flow from vessel operations annually and $60m in catch-up payments relating to operations in prior periods f Active project pipeline, both f
Slide 6: Spotlight on Foinaven Contract Amendment
Spotlight on Foinaven Contract Amendment f Foinaven FPSO has operated in the UK Sector of the North Sea since 1997 f Foinaven field is a key area of focus and investment for the Foinaven co-venturers f Agreement to amend the operating contract for the Foinaven FPSO unit signed in March 2010 f Curren
Slide 7: Spotlight on Foinaven Contract Amendment
Spotlight on Foinaven Contract Amendment f Lump-sum payment of approximately $60 million in 2010 relating to operations in prior years f Revised revenue formula going forward: − daily base rate Provides an estimated incremental operating cash flow of − daily operating efficiency rate $30m - $40m p
Slide 8: Recontracting Significantly Enhances FPSO Cash Flows
Recontracting Significantly Enhances FPSO Cash Flows f Even without the addition of new FPSO units, our FPSO fleet is projected to generate strong cash flow FPSO Cash Flow Petrojarl Varg Remaining FPSO Fleet (ex-Petrojarl Varg) $180 June 2009 Forecast Total (incl. Petrojarl Varg) Foinaven Catch-up P
Slide 9: Strong Growth Expected In Floating Production Sector
Strong Growth Expected In Floating Production Sector FPSO Order Outlook 2010-15* *Net of redeployments / speculatively ordered units 117 120 100 92 Number of Units 80 72 60 40 20 0 $50-70 Oil ~$80 Oil $90-100 Oil Source: International Maritime Associates f Incremental demand for ~70-120 additional F
Slide 10: Conventional Tanker Business Highlights 2010 YTD
Conventional Tanker Business Highlights 2010 YTD f Teekay spot rates in Q1-10 averaged ~$32,000 for Suezmax tankers and ~$19,500 for Aframax tankers f Q2-10 to date (based on 50% of days booked): f Spot Aframax days booked at an average rate of $17,000 per day f Spot Suezmax days booked at an averag
Slide 11: Spot Tanker Rates Have Been Firming
Spot Tanker Rates Have Been Firming 55,000 Suezmax Aframax 50,000 45,000 40,000 35,000 USD / Day 30,000 25,000 20,000 15,000 10,000 5,000 0 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 to date Source : Clarksons 11 www.teekay.com
Slide 12: 2010E: Strongest Oil Demand Growth Since 2004
2010E: Strongest Oil Demand Growth Since 2004 Non-OECD Driving Oil Demand Growth Oil Market Fundamentals 3.0 OECD China f 2010 expected to be the strongest year for oil 2.5 Other Non-OECD Total Demand Grow th 2.0 demand growth since 2004 led by non-OECD Million Barrels Per Day 1.5 f 16% yr-on-yr inc
Slide 13: Tanker Fleet Growth Tempered By Increased Scrapping
Tanker Fleet Growth Tempered By Increased Scrapping Tanker Removals on the Rise Tanker Supply Update Tanker Removals Scrap Price f Vessel scrap prices have risen steadily since 8.0 500 Q2-09, encouraging increased scrapping 7.0 450 f Increasing difficulty trading single-hull tankers Million Deadweig
Slide 14: Updated 2010 Tanker Fleet Utilization Outlook
Updated 2010 Tanker Fleet Utilization Outlook 94% 94% 2010 2010 Base Case Recovery Case +/- 2% 92% 92% +1% Fleet Utilization Fleet Utilization 90% 90% +1.5% +0.5% 88% +0.5% 88% +0.5% 86% Upside Potential + 6% 86% 86% 84% 84% Source: IMF / IEA / CRS / Platou / Internal estimates 82% 82% 2010 (E) (1)
Slide 15: Q1 2010 Consolidated Normalized Income Statement
Q1 2010 Consolidated Normalized Income Statement Three Months Ended Three Months Ended March 31, 2010 December 31, 2009 Reclass for (in thousands of US dollars, except Realized Gains/ per share amounts) Losses As Reported Appendix A Items (1) on Deriviatives (2) As Adjusted As Adjusted NET REVENUES
Slide 16: Improving Teekay Parent Transparency - Introducing Appendix D
Improving Teekay Parent Transparency - Introducing “Appendix D” (in thousands of U.S. dollars) Three Months Ended March 31, December 31, September 30, June 30, March 31, 2010 2009 2009 2009 2009 Teekay Parent cash flow from vessel operations 35,715 (18,740) (16,866) (181) 26,397 (1) Daughter company
Slide 17: Significant Debt Reduction Achieved at Teekay Parent
Significant Debt Reduction Achieved at Teekay Parent ~$900m Total Liability Reduction $2,500 $2,000 $ Millions $1,500 $1,000 $500 $0 Dec. 31, 2008 Mar. 31, 2010 Pro Forma Apr. 2010 Dropdowns to TNK Net Debt Pre-financed Newbuild Committments f Focused on moving Teekay Parent towards being net debt f
Slide 18: Teekay Parent Balance Sheet Provides Financial Strength and Flexibility
Teekay Parent Balance Sheet Provides Financial Strength and Flexibility Teekay Parent Net Debt Teekay Parent Liquidity ($000s) As at ($000s) As at Mar 31, 2010 Mar 31, 2010 Bonds $471.9 Cash $389.4 Term Debt 553.9 Undrawn Revolvers 855.0 Revolver Debt 70.0 Current Liquidity 1,244.4 Cash (incl. Restr
Slide 19: Significant Liquidity and Favorable Debt Profile
Significant Liquidity and Favorable Debt Profile f No significant debt balloon payments over next several years Teekay Parent 1,500 $1,244 Balloon Payments Undrawn Lines 1,000 $ Millions Cash $855 500 $389 $26 $48 0 Total Liquidity 2010 2011 2012 2013 2014 31-March-10 1 19 www.teekay.com
Slide 20: Appendix
Appendix www.teekay.com Ae
Slide 21: Substantial Asset Value at Teekay Parent
Substantial Asset Value at Teekay Parent Teekay Parent Assets ($ millions) Conventional Tankers – Spot (1) $814 Conventional Tankers – Fixed (1) 184 FPSOs (2) 901 Newbuilding Installments (3) 177 FMV of Teekay Parent Fleet $2,075 Teekay Parent Equity Investment in Daughters(4) TGP $734 TOO 291 Value
Slide 22: Q1 2010 Appendix A Item Descriptions
Q1 2010 Appendix A Item Descriptions Q1 - 2010 (in thousands of US dollars) Appendix A Items Explanation of Items NET VOYAGE REVENUES Revenues (30,000) Retroactive component of Foinaven FPSO contract amendment recognized in Q1 Voyage expenses - Net voyage revenues (30,000) OPERATING EXPENSES Vessel
Slide 23: Q4 2009 Adjusted Net Income Reconciled to GAAP Net Income
Q4 2009 Adjusted Net Income Reconciled to GAAP Net Income Three Months Ended December 31, 2009 Reclass for (in thousands of US dollars, except Realized Gains/ per share amounts) Losses As Reported Appendix A Items (1) on Deriviatives (2) As Adjusted NET VOYAGE REVENUES Revenues 522,657 (4,900) (53)
Slide 24: Teekay Parent – 2010/11 Conventional Tanker Fleet Employment
Teekay Parent – 2010/11 Conventional Tanker Fleet Employment Three Months Ending Jun. 30, Sep. 30, Dec. 31, Mar. 31, Jun. 30, Sep. 30, Dec. 31, 2010E 2010E 2010E 2011E 2011E 2011E 2011E Suezmax (1) Spot revenue days 792 828 828 810 795 828 1,012 (2)(3)(4) Average time-charter rate 27,878 27,647 27,6
Slide 25: Teekay Parent – Q1-2010 In-chartered Fleet
Teekay Parent – Q1-2010 In-chartered Fleet Three Months Ended March 31, December 31, March 31, 2010 2009 2009 Suezmax(1) Average in-charter rate 29,973 29,426 29,980 In-charter days 445 534 516 Aframax - external in-charters Average in-charter rate 26,133 29,030 31,718 In-charter days 713 781 2,076
Slide 26: Teekay Parent – 2010/11 In-chartered Fleet
Teekay Parent – 2010/11 In-chartered Fleet Three Months Ending Jun. 30, Sep. 30, Dec. 31, Mar. 31, Jun. 30, Sep. 30, Dec. 31, 2010E 2010E 2010E 2011E 2011E 2011E 2011E Suezmax(1) Average in-charter rate 29,863 30,030 30,030 29,799 27,643 27,033 27,033 In-charter days 455 460 460 430 299 276 276 Afra
Slide 27: Daughter Cash Flows from Teekay Parent Common Share/Unit Ownership
Daughter Cash Flows from Teekay Parent Common Share/Unit Ownership Three Months Ended March 31, December 31, September 30, June 30, March 31, 2010 2009 2009 2009 2009 Teekay LNG Partners Distribution per common unit $0.60 $0.57 $0.57 $0.57 $0.57 Common units owned by Teekay Parent 25,208,274 25,208,