Teekay Tankers Ltd. · NYSE:TNK
Teekay Tankers — Q4 2022 Earnings Presentation
17 slides from Teekay Tankers's earnings presentation, Feb 1, 2023
Slide 1: Fourth Quarter and Annual 2022 Earnings Presentation
Teekay Tankers Fourth Quarter and Annual 2022 Earnings Presentation February 23, 2023
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, among other things, statements re
Slide 3: Recent Highlights
Recent Highlights Financial Update Value Creation Tanker Market Adjusted net income(1) of $147.5 High operating leverage, with 51 Very strong spot tanker rates in Q4- million, or $4.33 per share, compared vessels(2) (96% of the fleet) trading 22 and Q1-23 to-date with Aframax to $57.9 million, or $1
Slide 4: Very Strong Rates in TNK's Fourth Quarter
Very Strong Rates in TNK’s Fourth Quarter Average Mid-Size Tanker Rates Benchmark Crude Tanker Spot Rates Q4-22 With Strength VLCC Suezmax Aframax Continuing Into Q1-23 60 140 Spot tanker rates were extremely 120 firm in Q4-22 due to a mixture of 50 positive demand fundamentals and 100 seasonal fact
Slide 5: Q1-23 To-Date Spot Rates
Q1-23 To-Date Spot Spot Rates Rates 80,000 70,000 Elevated spot rates continued into Q1-23 to-date results 60,000 Rate ($/day) Expanded charter-in portfolio with 50,000 four additional vessels joining in late 40,000 Q4-22 and early Q1-23 67,600 30,000 56,000 • Includes one chartered-in 50,600 52,100
Slide 6: Crude Trade Pattern Changes Almost Exclusively Benefit Mid-Sized Tankers
Crude Trade Pattern Changes Almost Exclusively Benefit Russian Crude Oil European Crude Oil 2022 Crude Tanker Mid-Sized Tankers Exports (100% Lifted Imports (90% Delivered Demand Growth (%) on Aframax / Suezmax) on Aframax / Suezmax) 100% of crude oil volumes lifted from Russian ports are on mid-siz
Slide 7: Oil Demand Set to Reach Record High in 2023
Oil Demand Set to Reach Record High in Global Oil Demand Chinese Oil Demand 2023 Driven by China 102 17.0 As per the IEA, global oil demand is 16.5 expected to increase by 2.0 mb/d in 100 2023 to a record high of 101.9 mb/d 16.0 98 The end of China’s zero-COVID 15.5 policy is expected to lead to a m
Slide 8: Low Fleet Growth For the Next 2-3 Years
Low Fleet Growth For the Next 2-3 Years, Tanker Delivery Schedule Tanker Demand Set to Outstrip Fleet Tanker Fleet Utilization Supply Growth in 2023 / 24 Set to Remain High Aframax Suezmax VLCC Tonne-Mile Demand Growth Fleet Supply Growth Tanker fleet growth is set to slow significantly over the nex
Slide 9: High Operating Leverage Positions TNK for Significant Free Cash Flow
High Operating Leverage Positions TNK for Significant Free Cash Flow FCF Per Share Spot Rate Sensitivity Next 12 Months (1,2,3) Generation $28.00 75% Prioritized balance sheet improvements $26.00 70% and value creation in 2022: Q1-23 Avg to-date spot TCE $24.00 65% • FCF(1) generation of $318 millio
Slide 10: Appendix
Appendix 10
Slide 11: Manageable Debt Repayments
Manageable Debt Repayments Pro Forma Debt Repayment Profile(1,2,3) 250 200 $ Millions 150 164 100 50 45 43 44 45 46 0 2023 2024 2025 2026 2027 Declared Sale Leaseback Purchase Options (1) Purchase options of $164 million is expected to be paid with cash by end Q1-23. (2) Excludes working capital loa
Slide 12: Fleet In-Charters
800 800 700 700 Fleet In-Charters Newbuild Eco Aframax in-charter 600 600 delivered in January. The Vessel is in-chartered for 7 years at $18,700 per day with multi-year extension 500 500 options Ship Days 400 400 300 300 200 200 100 100 - - Q1-2023 Q2-2023 Q3-2023 Q4-2023 Q1-2024 Q2-2024 Q3-2024 Q4
Slide 13: Fleet Out-Charters
120 120 Fleet Out-Charters(1) 100 100 TNK entered into one Aframax out- chartered for $48,500 per day for 12 months and one Suezmax out- 80 80 chartered for $38,475 per day for 21-26 months Ship Days 60 60 40 40 20 20 - - Q1-2023 Q2-2023 Q3-2023 Q4-2023 Q1-2024 Q2-2024 Q3-2024 Q4-2024 Q1-2025 Q2-202
Slide 14: Q1-23 Outlook
Q1-23 Outlook Q1-23 Outlook(1) Income Statement Q4-22 in thousands (expected changes from Q4-22) Item adjusted basis(1) Increase of approximately 95 net revenue days, consisting of an increase of 100 fixed days and a decrease of 5 spot days, primarily due to four in-chartered tankers, three of which
Slide 15: Adjusted Net Income
Adjusted Net (In thousands of U.S. dollars) Income(1) Q4-2022 Q3-2022 Statement Item Variance Comments Q4-22 vs Q3-22 (unaudited) (unaudited) Revenues 368,145 279,766 88,379 Voyage expenses (131,989) (135,013) 3,024 (2) Net revenues 236,156 144,753 91,403 Increase primarily due to higher overall spo
Slide 16: 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 Q4-22 Items (1) Realized Gain/ Loss on Derivatives Revenues 367,318 - 827 368,145 Voyage expenses (131,989) - - (131,989) Net revenues (2) 235,329 - 827 236
Slide 17: Drydock & Off-hire Schedule
Drydock & Off-hire Schedule(1)(2)(3) Teekay Tankers December 31, 2022 (A) March 31, 2023 (E) June 30, 2023 (E) September 30, 2023 (E) December 31, 2023 (E) Total 2023 (E) Total Total Total Total Total Total Vessels Off-hire Vessels Off-hire Vessels Off-hire Vessels Off-hire Vessels Off-hire Vessels