Slide 1: Teekay's Second Quarter 2009 Earnings Presentation
TEEKAY CORPORATION Teekay’s Second Quarter 2009 Earnings Presentation September 3, 2009 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: Highlights
Highlights f Q2 ’09 adjusted net loss of $21.8m, or $0.30 per share(1) f Generated $129.7m of consolidated cash flow from vessel operations(2) f Reduced spot tanker market exposure f Focus on cost containment is achieving results f Continued de-leveraging process at Teekay Parent f Completed follow-
Slide 4: World Fleet Utilization Down on OPEC Cuts and Tanker Supply Growth
World Fleet Utilization Down on OPEC Cuts and Tanker Supply Growth Tanker Fleet Utilization Aframax Spot Earnings 70,000 98% LHS Teekay Q3-09 spot rates booked to date: 96% 60,000 Suezmax: $15,000 / day (~80% booked) 94% 50,000 Aframax: $8,000 / day (~80% booked) 92% USD / Day 40,000 90% 30,000 88%
Slide 5: 2010 – Forecasted Demand Recovery
2010 – Forecasted Demand Recovery % Change Million B/D China Crude Imports & Car Sales Global Oil Demand vs. GDPs No Units 6% 5.0 1,000 Chinese Crude Oil Imports 900 5% 4% 4.5 Chinese Car Sales 800 3% 700 2% 4.0 600 1% 500 0% 3.5 400 -1% 300 -2% Global GDP % Change 3.0 200 -3% -4% Global Oil Demand
Slide 6: Maintaining Our Focus on Realizing Value
Maintaining Our Focus on Realizing Value 9 Actively managing asset portfolio 9 Improving profitability 9 De-leveraging at Teekay Parent 6 www.teekay.com
Slide 7: Actively Managing Asset Portfolio – Reducing Spot Exposure
Actively Managing Asset Portfolio – Reducing Spot Exposure f Over $20m reduction in time-charter hire expense in Q2 ’09, compared to Q1 ‘09 f Teekay’s spot market exposure will reduce further in 2H2009 as in- charters continue to roll-off Aframax Fleet Profile(1) Suezmax Fleet Profile(2) Reducing 60
Slide 8: Actively Managing Asset Portfolio: Continuing to Secure Fixed-Rate Business
Actively Managing Asset Portfolio: Continuing to Secure Fixed-Rate Business f Secured new 10-year fixed-rate charter with Caltex Australia f Acquired 2007-built product tanker to service this contract f Signed definitive contract for 7.5-year fixed-rate FSO charter with Occidental Petroleum f Extend
Slide 9: Improving Profitability: Year-on-Year G&A Costs Reduced
Improving Profitability: Year-on-Year G&A Costs Reduced f Since peaking in Q2 ‘08 at approximately $68m, quarterly G&A run-rate is down by approximately 20% f 15% headcount reduction, rationalization of 4 offices and other cost saving initiatives have resulted in permanent savings Normalized* Teekay
Slide 10: Improving Profitability: OPEX Savings
Improving Profitability: OPEX Savings f Teekay consolidated quarterly OPEX* is down ~7% from one year ago f $10m of quarterly savings year-on-year, net of OPEX changes due to net fleet growth and unrealized FX gains $160 $155 OPEX ($ Millions) $150 $10m $145 $140 $135 Q2 '08 OPEX* FPSO OPEX Crew / M
Slide 11: Cash Flow Break-Even Declining Rapidly
Cash Flow Break-Even Declining Rapidly f Due to: f Roll-off of in-chartered vessels f Additional out-charters f Renewal of below market contracts at market rates f Reduced G&A expenses f Reduced operating expenses Aframax Spot Cash Flow Break Even Rate* $16,000 $14,000 Cash flow sensitivity per $1,0
Slide 12: De-leveraging at Teekay Parent
De-leveraging at Teekay Parent f Teekay Parent net debt continues to decline through vessel dropdowns and third party sales Teekay Parent Asset Dropdowns / Transaction Date Net Debt Reduction Third Party Sales (USD Millions) LNG carriers Dropdown to Aug ‘09 $70m (Tangguh Hiri and Tangguh Sago) Teeka
Slide 13: Continued De-leveraging at Teekay Parent: Varg FPSO Dropdown
Continued De-leveraging at Teekay Parent: Varg FPSO Dropdown f On July 1, 2009 the Varg FPSO commenced a new 4-year contract (with extension options) at increased rates f Teekay has formally offered the Petrojarl Varg FPSO to Teekay Offshore f Offer is currently under review by the Teekay Offshore C
Slide 14: Significant Leverage Reduction Achieved at Teekay Parent
Significant Leverage Reduction Achieved at Teekay Parent f Between Q2 ’08 and Q2 ‘09: f Teekay Parent net debt has been reduced by $305m – net debt to total capitalization currently at 32% f Tangguh LNG and Varg FPSO dropdowns will provide further de-leveraging f Remaining newbuilding capital commit
Slide 15: Teekay Remains Financially Strong
Teekay Remains Financially Strong f Over $2.0bn of consolidated liquidity at June 30, 2009 f Additional credit facilities are in place for 96% of future newbuilding capital expenditure commitments of $785m f No covenant concerns f No significant balloon payments until 2011 Annual Teekay (Consolidate
Slide 16: Normalized Income Statement
Normalized Income Statement Three Mon ths En ded Ju ne 30, 2009 March 31, 2009 Reclass for (in thousands of US dollars , except Realized Gain s/ per share am ounts) Losses As Rep orted Appendix A Items (1) on Deriviatives (2) As Adjusted As Adjusted NET REVENUES Voyage revenues 532,473 - 4,294 536,7
Slide 17: Teekay Asset Value Summary
Teekay Asset Value Summary Teekay is trading at a 56% discount to its NAV ($ millions) (per share) Conventional Tanker Assets $1,177 FPSO Assets $1,056 (1) Newbuildings $214 FMV of Teekay Parent Fleet $2,447 (2) Less: Teekay Parent Net Debt ($1,012) NAV of Teekay Parent Fleet $1,435 $19.78 Plus: Val
Slide 18: Appendices
Appendices www.teekay.com
Slide 19: Q2 2009 Appendix A Item Descriptions
Q2 2009 Appendix A Item Descriptions Q2 -2008 Appendix A Items Explanation of Items NET REVENUES Voyage revenues - Voyage expenses (432) Freight tax Net revenues 432 OPERATING EXPENSES Vessel operating expense 6,919 Unrealized gains on derivative instruments Time charter hire expense - Depreciation
Slide 20: Q1 2009 Adjusted Net Income Reconciled to GAAP Net Income
Q1 2009 Adjusted Net Income Reconciled to GAAP Net Income Three Months Ended March 31, 2009 Reclass for (in thousands of US dollars, except Realized Gains/ per share amounts) Losses As Reported Appendix A Items on Deriviatives (1) As Adjusted NET REVENUES Voyage revenues 616,551 - (2,289) 614,262 Vo
Slide 21: 2010 Teekay Parent Fleet Employment Profile
2010 Teekay Parent Fleet Employment Profile Aframax Fleet Profile(1) Suezmax Fleet Profile 50 30 37 36 40 25 34 20 6 5 30 20 18 18 # Vessels 4 18 # Vessels 30 4 4 4 3 5 5 5 3 15 4 4 4 5 2 20 5 2 2 2 10 22 22 11 11 11 11 10 21 19 5 0 2 1 1 1 0 Q1 10 Q2 10 Q3 10 Q4 10 Q1 10 Q2 10 Q3 10 Q4 10 In-charte