Slide 1: Teekay Corporation Q1-2016 Earnings Presentation
TEEKAY TEEKAY TEEKAY CORPORATION Q1-2016 EARNINGS PRESENTATION May 19, 2016
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements which reflect management's current views with respect to certain future events and performance, including statements regarding: the timing and completion of Teekay Parent’s financing initiatives and their impact on Teek
Slide 3: Recent Highlights
Recent Highlights • Generated consolidated CFVO1 of $359 million in Q1-16, an increase of 12 percent from Q1-15 • Reported adjusted net loss1 of $6 million, or $0.08 per share, in Q1-16, compared to adjusted net income1 of $16 million, or $0.22 per share, in Q1-15 • Declared Q1-16 cash dividend of $
Slide 4: Recent Daughter Highlights
Recent Daughter Highlights Teekay Offshore Partners • Generated CFVO1 of $166 million in Q1-16, an increase of 22% from Q1-15 • Declared Q1-16 cash distribution of $0.11 per unit – distribution coverage ratio of 5.16x • Financial initiatives expected to address near and medium-term debt maturities;
Slide 5: Summary of TK Parent's Financing Initiatives
Summary of TK Parent’s Financing Initiatives Will further de-lever Teekay Parent’s balance sheet and increase liquidity and is on track for completion in June 2016 Initiative Status • $150 million Equity Margin Loan Revolver (an increase from $36 • $50 million facility secured by VLCC already millio
Slide 6: Summary of TOO's Financing Initiatives
Summary of TOO’s Financing Initiatives Addresses near and medium-term debt maturities and growth projects through 20181 fully financed; and on track for completion in June 2016 Initiative Status • $250 million debt facility for the East Coast Canada shuttle tanker project • $35 million of new loan f
Slide 7: TOO's CFVO Continues to Grow
TOO’s CFVO Continues to Grow Proportionally Consolidated Estimated Run-Rate CFVO $950 $850 $750 $650 In USD Millions $550 $450 $350 $250 $150 2015 Run-Rate CFVO (1) OPEX and G&A Savings Navion Saga Layup and Varg Contract Termination Four ALP Newbuilding Petrojarl I Delivery (Q4- Gina Krog Delivery
Slide 8: TGP's CFVO Continues to Grow
TGP’s CFVO Continues to Grow Includes TGP’s proportionate share of equity-accounted investment CFVO $800 Committed growth in 2018 – 2020 expected to add approximately $250M of annual CFVO(1) $600 USD Millions $400 $200 $- Current Run- YLNG Cheniere Conventional Centrofin YLNG MEGI Shell LNG BG LNG E
Slide 9: Phased Approach to Value Creation
Phased Approach to Value Creation Return Teekay Corp to a high dividend GP 1. Complete financing initiatives with the goal of building liquidity and strengthening balance sheets ○ Majority of financial commitments secured and final completion expected in June 2016 2. Optimize asset portfolio and bal
Slide 10: Neither the GP Option Value Nor Recovery in MLP Daughter Company Share Prices Currently Priced In
Neither the GP Option Value Nor Recovery in MLP Daughter Company Share Prices Currently Priced In $ Millions Pre-distribution cut Teeky Corp Assets May 18, 2016 September 30, 2015 FPSO Assets(1) $350 $300 Conventional Tanker Asset(1) 85 75 JVs and Other Investments(2) 125 225 FMV of Teekay Corp Flee
Slide 11: Financial Appendices
Financial Appendices 11
Slide 12: Consolidated Adjusted Statement of (Loss) Income
Consolidated Adjusted Statement of (Loss) Income Q1-16 vs. Q4-15 ($’000’s, Q1-16 Adjusted* Q4-15 Adjusted* Comments except per share amounts) Net revenues 595,803 663,323 Decrease primarily due to the Foinaven FPSO annual recognition of operation and oil price tariff revenue in Q4-15, production bon
Slide 13: Q2 2016 Outlook – Teekay Consolidated
Q2 2016 Outlook – Teekay Consolidated Income Q2 2016 Statement Item Outlook (expected changes from Q1-16) Teekay Parent: $1.5m increase from Banff FPSO from 23 off-hire days in Q1-16 $2m decrease from S&P fees on the sale of two VLCCs in Tanker Investments in Q1-16 Teekay Offshore: $9m decreas
Slide 14: Teekay Parent Free Cash Flow (FCF)
Teekay Parent Free Cash Flow (FCF) Q1-16 vs. Q4-15 ($’000’s, except per share amounts) GPCO Q1-16 Q4-15 LP Distributions 7,732 7,732 GP Distributions 467 467 Other dividends 3,635 4,846 Total Daughter Distributions 11,834 13,045 Less: Corporate G&A (4,951) (4,174) Teekay Parent GPCO Cash Flow 6,883
Slide 15: Forecast Assumptions – Vessel Deliveries and Sales
Forecast Assumptions – Vessel Deliveries and Sales TGP Vessel Estimated Project Ownership Type Delivery (1) Interest Cheniere LNG Newbuilding #1 LNG 100% Q1-2016 Cheniere LNG Newbuilding #2 LNG 100% Q3-2016 Exmar LPG Newbuilding #1 LPG 50% Q1-2016 Assumed Vessel Sales: Exmar LPG Newbuilding #2 LPG 5
Slide 16: Consolidated Adjusted Statement of (Loss) Income
Consolidated Adjusted Statement of (Loss) Income Q1-16 Three Months Ended March 31, 2016 Reclass for (in thousands of US dollars, except per share amounts) Realized Gains/ Appendix A Losses As Reported Items (1) on Derivatives (2) As Adjusted Revenues 641,108 (13,715) - 627,393 Voyage expenses (31,5
Slide 17: Consolidated Adjusted Statement of Income
Consolidated Adjusted Statement of Income Q4-15 Three Months Ended December 31, 2015 Reclass for (in thousands of US dollars, except per share amounts) Realized Gains/ Appendix A Losses As Reported Items (1) on Derivatives (2) As Adjusted Revenues 700,106 (491) - 699,615 Voyage expenses (36,292) - -
Slide 18: Business Appendices
Business Appendices 18
Slide 19: Medium-Term LNG Growth Projected to Remain on Track
Medium-Term LNG Growth Projected to Remain on Track • Increase in LNG fleet capacity has LNG Export Capacity and Trade (MTPA) put downward pressure on near- 2015 2020 term rates ○ Capacity has increased 25% +36% since the start of 2013 308 +43% ○ LNG trade increased < 5% over 245 the same time • Lon
Slide 20: Redeployment of Existing FPSOs Economic Below $30/bbl Oil Price
Redeployment of Existing FPSOs Economic Below $30/bbl Oil Price Break even range(2) • Redeployment FBUC(1) typically 25-50% of newbuild $/bbl 50 • Reuse of existing asset offers significantly lower break-even and lifting cost 45 than comparable newbuild solution for the same field development 40 • W
Slide 21: Tanker Demand has Continued to Grow
Tanker Demand has Continued to Grow High oil supply and demand, combined with low oil and bunker prices Middle East OPEC Production Global Oil Demand 98 24.5 10.5 Mb/d (Middle East OPEC) 24.0 97 Mb/d (Saudi Arabia) 10.0 23.5 96 Million bbls 9.5 23.0 95 22.5 9.0 22.0 94 8.5 21.5 8.0 93 21.0 Middle Ea
Slide 22: Strategic Customer Relationships
Strategic Customer Relationships Teekay benefits from strong relationships with diverse group of creditworthy customers # Customer Share(1) Credit rating 1 Shell(2) 16.6% Aa2 / A+ 2 Petrobras 9.5% B3 / B+ 3 BP 7.4% A2 / A- 4 Statoil 7.3% Aa3 / A+ 5 E.ON 5.3% Baa1 / BBB+ 6 Repsol 4.4% Baa2 / BBB- 7 C
Slide 23: Bringing Energy To
BRINGING ENERGY TO