Teekay Tankers Ltd. · NYSE:TNK
Teekay Tankers — Q1 2020 Earnings Presentation
20 slides from Teekay Tankers's earnings presentation, May 21, 2020
Slide 1: Teekay Tankers Q1-2020 Earnings Presentation
Teekay Tankers Q1-2020 Earnings Presentation May 21, 2020
Slide 2: Forward Looking Statement
Forward Looking Statement 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 reg
Slide 3: Recent Highlights
Recent Highlights Highest Results in Strengthening our Tanker Market More than 10 Years Balance Sheet Total adjusted EBITDA(1) of $155.4 Generated over $140 million of free Mid-size tanker spot rates in Q1-20 million, up $22.6 million from Q4-19 cash flow(1) and completed were the highest since Q3-0
Slide 4: Operating in a COVID-19 Environment
Operating in a COVID-19 Environment Protecting the health and Focus on Safety and Operations Continue Maintenance safety of our seafarers and Health of our Crew to Perform Efficiently Management onshore staff while ensuring business continuity • Crew changes are not possible • No onboard cases of CO
Slide 5: Rates in Q1-20 the Highest in Over 10 Years
Rates in Q1-20 the Highest in Over 10 Average Mid-Size TCEs Crude Tanker Floating Storage(1) Years Suezmax Aframax 70 120 Elevated supply in March and VLCC Suezmax Aframax April due to Russia / Saudi 60 price war, collapse in oil 100 prices, and rise in floating storage boosted spot tanker 50 rates
Slide 6: Q2-20 Spot TCEs Update
Q2-20 Spot TCEs 60,000 Update $49,100 $52,100 40,000 $34,400 $33,200 $34,500 $34,300 TCE $20,100 20,000 $17,300 $15,700 0 (2) Suezmax Aframax (1) LR2 Q2-19 Actual Q1-20 Actual Q2-20 to-date Suezmax Aframax(1) LR2(2) Q2-20 spot ship 1,570 1,644 886 days available Q2-20 % booked 69% 64% 58% to-date (1
Slide 7: TNK Securing Fixed-Rate Coverage at Time Charter Market Peaks
TNK Securing Fixed- Rate Coverage at Time TNK Out-Charters vs. TC Rates Charter Market Peaks Suezmax 1-year TC rate Aframax 1-year TC rate 55 10 Suezmaxes and 3 Aframax Suezmax Time Charter Aframax Time Charter 6 months sized vessels out-chartered 50 since October 2019 for periods of 6-24 months 45
Slide 8: Medium-Term Uncertainty, but Lower Fleet Growth Than in Prior Cycles
Medium-Term Uncertainty, but Relative Orderbook Size vs. Tanker Rates Lower Fleet Growth 60 60% Than in Prior Cycles Potential for a period of destocking as oil markets 50 50% normalize, however… Orderbook as % of Fleet • Tanker orderbook currently 8% of the existing fleet size, lowest 40 40% ‘000 U
Slide 9: Significantly Improved Financial Strength
Significantly Improved Financial Strength Generated over $140 million of Net Debt(1) and Liquidity free cash flow(2) in Q1-20 and completed $60 million in asset $1,000 sales • Net debt reduced by over Net debt reduced by $60 20% from Q4-19 to $730 $800 million in 1 month million at end of Q1-20 • Li
Slide 10: Continuing to Create Significant Shareholder Value
Continuing to Create Free Cash Flow(3) FCF(3)(4) Spot Rate Sensitivity Significant Next 12 Months(5) Shareholder Value $150 $800 Annualized Q1-2020 free cash flow yield of approximately $700 100% based on current share $125 price(1) $600 Over $240 million of free cash $100 flow generated in the last
Slide 11: Executing on our Strategic Priorities
Executing on our Strategic Priorities Continue to execute on our strategic priorities despite 2020 Strategic Priorities Execution to-date operating in COVID-19 environment • Maintain significant spot exposure • 80% of the fleet trading in spot market Operating • Out-chartered 10 Suezmaxes, three • O
Slide 12: Appendix
Appendix 12
Slide 13: Debt Repayment Profile
Debt Repayment Profile Debt Repayment Profile (1,2) 250 200 148 150 $ Millions 71 100 50 110 97 88 85 29 0 2020 2021 2022 2023 2024 Repayments incl. Capital Lease Balloon Payments (1) Excludes working capital loan facility which is expected to be continually extended for periods of six months unless
Slide 14: Fleet Employment – In Charter
500 Fleet Employment – In 450 Charter(1) 400 350 Ship Days 300 250 200 150 100 50 - Q2-2020 Q3-2020 Q4-2020 Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Aframax/LR2 Days 364 368 368 183 91 68 - - Aframax/LR2 Rates 21,188 21,188 21,188 21,471 21,000 21,000 - - Aframax/LR2 Days (1) Based on existing charte
Slide 15: Fleet Employment – Out-Charters
900 Fleet Employment – 800 Out-Charters(1) 700 Ship Days 600 500 400 300 200 100 - Q2-2020 Q3-2020 Q4-2020 Q1-2021 Q2-2021 Q3-2021 Q4-2021 Q1-2022 Q2-2022 Suezmax Days 863 899 573 450 122 - - - - Aframax/LR2 Days 188 322 322 279 210 184 184 180 103 Suezmax Rates 40,268 42,542 44,312 45,600 45,189 -
Slide 16: Q2-20 Outlook
Q2-20 Outlook Income Statement Item Q2-20 Outlook(1) (expected changes from Q1-20) Decrease of approximately 220 net revenue days, mainly due to the sale of three vessels and the redelivery of two chartered-in vessels in Q1-20, as well as more drydockings in Q2-20 compared to Q1- 20. Revenues The sa
Slide 17: Adjusted Net Income
(In thousands of U.S. dollars) Adjusted Net Income1 Q1-2020 Q4-2019 Statement Item Variance Comments Q1-20 vs Q4-19 (unaudited) (unaudited) Revenues 341,851 327,932 13,919 Increase primarily due to higher overall spot TCE rates in Q1-20, higher net results from full service lightering, as well as fe
Slide 18: Consolidated Adjusted Statement of Income
Consolidated Adjusted Statement of (In thousands of U.S. dollars) Income Statement Item As Reported Appendix A Items Reclassification for As Adjusted Q1-20 (1) Realized Gain/ Loss on Derivatives Revenues 341,900 - (49) 341,851 Voyage expenses (119,241) - - (119,241) Vessel operating expenses (50,649
Slide 19: Drydock & Off-hire Schedule
Drydock & Off-hire Schedule(1)(2)(3) Teekay Tankers March 31, 2020 (A) June 30, 2020 (E) September 30, 2020 (E) December 31, 2020 (E) Total 2020 Total Total Total Total Total Vessels Off-hire Vessels Off-hire Vessels Off-hire Vessels Off-hire Vessels Off-hire Segment Days Days Days Days Days Spot Ta
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