Teekay Tankers Ltd. · NYSE:TNK
Teekay Tankers — Q3 2008 Earnings Presentation
19 slides from Teekay Tankers's earnings presentation, Dec 19, 2008
Slide 1: Third Quarter 2008 Earnings Presentation
T E E K A Y T A N K E R S L T D. Third Quarter 2008 Earnings Presentation December 19, 2008 www.teekaytankers.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: the Company’
Slide 3: Third Quarter Highlights
Third Quarter Highlights Generated Cash Available for Distribution of $26.7m Declared third quarter dividend of $1.07 per share, bringing Q3 YTD dividend to $2.67 per share Earned net income of $19.6m, or $0.78 per share Including unrealized loss on an interest rate swap which decreased net
Slide 4: Time-charter Coverage Allows Dividend Payout in Any Spot Tanker Market
Time-charter Coverage Allows Dividend Payout in Any Spot Tanker Market Name Y/ Built Dwt Break-down of Fleet Coverage Narmada Spirit 2003 159,200 Fixed Spot Falster Spirit 1995 95,400 Spot Exposure 2009E 55% 45% Kanata Spirit 1999 113,000 2010E 42% 58% Sotra Spirit 1995 95,400 Kyeema Spirit 1999 113
Slide 5: Dividend Payout Enhanced by Favorable Debt Profile
Dividend Payout Enhanced by Favorable Debt Profile Minimal principal payments until 2013 Low average cost of debt ~4%* No covenant concerns Principal Payments Revolver Reductions 16 14 12 $ Millions 10 $10.9 8 6 $3.6 $3.6 $3.6 $3.6 4 2 $3.6 $0.5 0 2008 2009 2010 2011 2012 2013 *Includes effect
Slide 6: Q4 is Shaping Up to Be Another Solid Quarter
Q4 is Shaping Up to Be Another Solid Quarter Q4 spot rates booked to date: Aframax: $36,500 per day (~90% booked) Suezmax: $46,500 per day (~90% booked) Estimated dividend amounts in the table below reflect existing spot and time-charter mix: Q4 2008 Estimated Suezmax Spot TCE Rate Per Day D
Slide 7: Teekay Tankers Represents Compelling Value
Teekay Tankers Represents Compelling Value Current Yield* of High Yield Tanker Companies 40.0% 37.9% 35.0% 30.0% 25.0% 20.0% 18.6% 15.0% 13.3% 13.2% 10.0% 6.5% 5.0% 0.0% TNK NAT GMR VLCCF FRO *Q3’08 dividend annualized. Share prices as of Dec. 18, 2008 7 www.teekaytankers.com
Slide 8: Tanker Market Update
T E E K A Y T A N K E R S L T D. Tanker Market Update www.teekaytankers.com
Slide 9: Aframax Tanker Rates – Winter Rally Underway
Aframax Tanker Rates – Winter Rally Underway 2006 2007 2008 ytd 100,000 90,000 80,000 70,000 60,000 USD / Day 50,000 40,000 30,000 20,000 10,000 0 Q1 Q2 Q3 Q4 Source : CRS (Aframax average) 9 www.teekaytankers.com
Slide 10: Winter Market Drivers
Winter Market Drivers TANKER DEMAND Latest OPEC production cutback is the biggest near term demand factor Q1-09 non-OPEC supply forecast ~0.7 mb/d higher than Q4-08 FSU / Brazil account for 0.5 mb/d of increase - positive for Aframax and Suezmax ~1 mb/d of refinery capacity expected online i
Slide 11: Single Hull Fleet vs. Orderbook by Crude Tanker Segment to 2010
Single Hull Fleet vs. Orderbook by Crude Tanker Segment to 2010 No. of Units Non-D/hull Orderbook to 2010 (Established Yards) Orderbook to 2010 (Greenfield Yards) Coated Units 225 200 175 150 125 100 75 50 25 0 VLCC Suezmax Aframax Source : CRS Tanker fleet growth may be dampened by greenfield yar
Slide 12: 2009 / 10 – Tanker Market Dynamics
2009 / 10 – Tanker Market Dynamics Demand Supply Economic downturn driving reduction in Potential for significant tanker supply near term oil demand growth if all newbuildings deliver but but Lower oil prices may stimulate renewed Newbuilding delays and cancellations oil demand growth due to
Slide 13: Financial Discussion
T E E K A Y T A N K E R S L T D. Financial Discussion www.teekaytankers.com
Slide 14: Q3 2008 Cash Available for Distribution
Q3 2008 Cash Available for Distribution Three Months Ended September 30, 2008 (unaudited) Net income 19,561 Add: Depreciation and amortization 5,823 Unrealized loss from interest rate swap 1,355 Less: Amortization of debt issuance costs and other (41) Cash Available for Distribution 26,698 Weighted-
Slide 15: Teekay Tankers' Financial Snapshot
Teekay Tankers’ Financial Snapshot Well-positioned in the current economic and financial environment: September 30, 2008 total liquidity: $72.5 million No requirement to tap equity markets No CAPEX commitments ‘Covenant-lite’ debt provides financial flexibility and enhances dividend payout
Slide 16: Teekay Tankers' Credit Metrics
Teekay Tankers’ Credit Metrics Leverage based on book value metrics is not representative Net Debt / Total Cap. (Book): 66.9% vs. Net Debt / Fair Market Value: 48.8% TNK book equity based on historical value to Teekay Corporation, not fair market value of TNK fleet Low leverage on a cash flow
Slide 17: Appendix
Appendix www.teekaytankers.com
Slide 18: Teekay Tankers' Financial Snapshot Back-up
Teekay Tankers’ Financial Snapshot Back-up (USD 000s, except per share amounts) Balance Sheet as of September 30, 2008 Leverage Metrics Long-term debt 319,728 Net debt / Fair market value 48.8% Less: cash (16,873) Net debt / Total capitalization (book) 66.9% Net debt / CFVO 2.8x Net debt 302,855 BV
Slide 19: Estimated Q4 Dividend
Estimated Q4 Dividend Q4 2008 Estimated Suezmax Spot TCE Rate Per Day Dividend Per Share* $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $20,000 $0.54 $0.57 $0.61 $0.64 $0.68 $0.70 $25,000 $0.59 $0.63 $0.67 $0.70 $0.73 $0.76 Spot TCE Rate $30,000 $0.65 $0.69 $0.72 $0.75 $0.78 $0.82 Aframax $35,000