Teekay Corp Ltd 6-K, filed Aug 13, 2020

Teekay Corp Ltd (TK)

6-K 2020-08-13 For: 2020-08-13

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Added on April 12, 2026

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Teekay Corp Ltd filed this 6-K on August 13, 2020.

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	TEEKAY CORPORATION

Date: August 13, 2020	By:	/s/ Vincent Lok
		Vincent Lok Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)



		Three Months Ended
		June 30,		March 31,		June 30,
(in thousands of U.S. dollars, except per share amounts)		2020		2020		2019 ⁽²⁾
(in thousands of U.S. dollars, except per share amounts)		(unaudited)		(unaudited)		(unaudited)
TEEKAY CORPORATION CONSOLIDATED
GAAP FINANCIAL COMPARISON
Revenues		482,805		574,054		462,397
Income from vessel operations		148,504		128,896		71,463
Equity income (loss)		35,343		2,313		(6,284	)
Net income (loss) attributable to
	shareholders of Teekay	21,723		(49,805	)	(39,485	)
Earnings (loss) per share attributable to
	shareholders of Teekay	0.21		(0.49	)	(0.39	)
NON-GAAP FINANCIAL COMPARISON
Total adjusted revenues ⁽¹⁾		592,658		681,353		532,138
Total adjusted EBITDA ⁽¹⁾		315,869		342,198		196,609
Adjusted net income (loss) attributable
	to shareholders of Teekay ⁽¹⁾	39,713		25,259		(13,368	)
Adjusted net income (loss) per share
	attributable to shareholders of Teekay ⁽¹⁾	0.39		0.25		(0.13	)
TEEKAY PARENT
NON-GAAP FINANCIAL COMPARISON
Teekay Parent adjusted EBITDA ⁽¹⁾		9,716		5,139		3,427
Total Teekay Parent free cash flow ⁽¹⁾		(1,886	)	52,689		(6,427	)



	Three Months Ended									Six Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,
	2020			2020			2019 ⁽¹⁾			2020			2019
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)

Revenues	482,805			574,054			462,397			1,056,859			949,270

Voyage expenses	(66,896		)	(121,564		)	(103,410		)	(188,460		)	(212,193		)
Vessel operating expenses	(147,796		)	(153,293		)	(162,621		)	(301,089		)	(319,613		)
Time-charter hire expense	(17,714		)	(27,056		)	(28,817		)	(44,770		)	(58,655		)
Depreciation and amortization	(62,936		)	(72,917		)	(73,849		)	(135,853		)	(145,956		)
General and administrative expenses	(23,668		)	(18,277		)	(20,868		)	(41,945		)	(43,840		)
Write-down and gain (loss) on sale of assets ⁽²⁾	(10,669		)	(94,606		)	—			(105,275		)	(3,328		)
Gain on commencement of sales-type lease ⁽³⁾	—			44,943			—			44,943			—
Restructuring charges⁽⁴⁾	(4,622		)	(2,388		)	(1,369		)	(7,010		)	(9,990		)
Income from vessel operations	148,504			128,896			71,463			277,400			155,695

Interest expense	(59,245		)	(62,520		)	(70,205		)	(121,765		)	(143,876		)
Interest income	2,314			2,803			2,233			5,117			4,922
Realized and unrealized loss on non-
designated derivative instruments ⁽⁵⁾	(9,270		)	(21,663		)	(10,964		)	(30,933		)	(16,387		)
Equity income (loss) ⁽⁶⁾	35,343			2,313			(6,284		)	37,656			(67,937		)
Income tax recovery (expense) ⁽⁷⁾	17,175			(3,792		)	(3,404		)	13,383			(8,440		)
Foreign exchange (loss) gain	(8,922		)	6,646			(5,851		)	(2,276		)	(8,481		)
Other loss – net (8)	(399		)	(681		)	(11,099		)	(1,080		)	(11,071		)
Net income (loss)	125,500			52,002			(34,111		)	177,502			(95,575		)
Net income attributable to
non-controlling interests	(103,777		)	(101,807		)	(5,374		)	(205,584		)	(28,167		)
Net income (loss) attributable to the shareholders
of Teekay Corporation	21,723			(49,805		)	(39,485		)	(28,082		)	(123,742		)
Earnings (loss) per common share of Teekay Corporation
- Basic	$	0.21		$	(0.49	)	$	(0.39	)	$	(0.28	)	$	(1.23	)
- Diluted	$	0.21		$	(0.49	)	$	(0.39	)	$	(0.28	)	$	(1.23	)
Weighted-average number of common shares outstanding
- Basic	101,107,362			100,887,551			100,783,496			100,997,456			100,652,685
- Diluted	101,196,383			100,887,551			100,783,496			100,997,456			100,652,685



		Three Months Ended						Six Months Ended
		June 30,		March 31,		June 30,		June 30,		June 30,
		2020		2020		2019		2020		2019
		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
Realized losses relating to
	Interest rate swap agreements	(3,879	)	(2,677	)	(1,785	)	(6,556	)	(3,473	)
	Stock purchase warrants ⁽ⁱ⁾	—		—		(25,559	)	—		(25,559	)
	Foreign currency forward contracts	—		(241	)	—		(241	)	—
	Forward freight agreements	(201	)	(49	)	(29	)	(250	)	(42	)
		(4,080	)	(2,967	)	(27,373	)	(7,047	)	(29,074	)
Unrealized (losses) gains relating to
	Interest rate swap agreements	(5,251	)	(18,812	)	(8,195	)	(24,063	)	(14,216	)
	Foreign currency forward contracts	53		202		(101	)	255		(101	)
	Stock purchase warrants	—		—		24,584		—		26,900
	Forward freight agreements	8		(86	)	121		(78	)	104
		(5,190	)	(18,696	)	16,409		(23,886	)	12,687
Total realized and unrealized losses on derivative instruments		(9,270	)	(21,663	)	(10,964	)	(30,933	)	(16,387	)



		Three Months Ended					Six Months Ended
		June 30,		March 31,	June 30,		June 30,	June 30,
		2020		2020	2019		2020	2019
		(unaudited)		(unaudited)	(unaudited)		(unaudited)	(unaudited)
Equity income (loss)		35,343		2,313	(6,284	)	37,656	(67,937	)
Proportionate share of unrealized losses
	on derivative instruments	3,806		22,204	5,203		26,010	13,968
Loss on sale of investment in Altera ⁽ⁱ⁾		—		—	7,853		—	72,753
Other⁽ⁱⁱ⁾		(61	)	8,441	1,023		8,380	1,023
Equity income adjusted for items in Appendix A		39,088		32,958	7,795		72,046	19,807


•	GAAP net income attributable to shareholders of Teekay of $21.7 million, or $0.21 per share, and adjusted net income attributable to shareholders of Teekay⁽¹⁾ of $39.7 million, or $0.39 per share, in the second quarter of 2020 (excluding items listed in Appendix A to this release).


•	Total adjusted EBITDA⁽¹⁾of $315.9 million in the second quarter of 2020, a 61 percent increase over the same period of the prior year.


•	Reduced consolidated net debt by over $267 million in the second quarter of 2020; and total consolidated liquidity position of approximately $940 million as of June 30, 2020.


•	Teekay LNG reported another record-high adjusted net income in the second quarter of 2020.


•	Teekay Tankers delivered nine vessels onto previously announced time charter-out contracts, increasing the percentage of the fleet on fixed-rate charters to approximately 23 percent and reducing its spot fleet free cash flow breakeven rate to $12,700 per day⁽³⁾ through mid-2021.


(1)	These are non-GAAP financial measures. Please refer to “Definitions and Non-GAAP Financial Measures” and the Appendices to this release for definitions of these terms and reconciliations of these non-GAAP financial measures as used in this release to the most directly comparable financial measures under United States generally accepted accounting principles (GAAP).


(2)	Comparative balances relating to the three months ended June 30, 2019 have been recast to reflect results consistent with the presentation in the Company’s 2019 Annual Report on Form 20-F and Form 6-K for the three and six months ended June 30, 2020.


(3)	Please refer to “Definitions and Non-GAAP Financial Measures” for definition of free cash flow in the Teekay Tankers Second Quarter of 2020 earnings release. The figures also includes expenditures for drydock and ballast water treatment system installation.


(1)	This is a non-GAAP financial measure. Please refer to “Definitions and Non-GAAP Financial Measures” and the Appendices to this release for a definition of this term and a reconciliation of this non-GAAP financial measure as used in this release to the most directly comparable financial measures under GAAP.


(i)	Stock purchase warrants for the three and six months ended June 30, 2019 relates to the sale of the Company's remaining interest in Altera in May 2019. Also refer to footnote (6)(i) below.


(i)	During the three and six months ended June 30, 2019, the Company recognized a loss of $7.9 million on sale of its investment in Altera to affiliates of Brookfield Business Partners L.P. (or Brookfield), which occurred in May 2019. Also refer to footnote (5)(i) above in respect of gains and losses on stock purchase warrants.


(ii)	Other for the three months ended June 30, 2020 and March 31, 2020 includes credit loss provision adjustments to the Company's financial instruments upon adoption of ASU 2016-13, Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments (ASU 2016-13).


(7)	Income tax recovery (expense) for the three and six months ended June 30, 2020 includes a reduction in freight tax accruals of $16.8 million related to periods prior to 2020.


(8)	Other loss – net for the three and six months ended June 30, 2019 includes a $10.7 million loss relating to the repurchase of the Company's 2020 Notes.



	As at June 30,	As at March 31,	As at June 30,
	2020	2020	2019
	(unaudited)	(unaudited)	(unaudited)
ASSETS
Cash and cash equivalents - Teekay Parent	66,917	48,366	74,890
Cash and cash equivalents - Teekay LNG	226,328	312,710	124,880
Cash and cash equivalents - Teekay Tankers	167,907	203,325	35,429
Assets held for sale	—	50,818	12,300
Accounts receivable and other current assets	318,726	359,705	424,735
Restricted cash - Teekay Parent	3,915	3,569	2,023
Restricted cash - Teekay LNG	66,147	113,528	80,308
Restricted cash - Teekay Tankers	8,203	6,755	5,353
Vessels and equipment - Teekay Parent	13,964	18,791	284,840
Vessels and equipment - Teekay LNG	2,931,602	2,959,067	3,320,937
Vessels and equipment - Teekay Tankers	1,672,976	1,676,213	1,856,766
Operating lease right-of-use assets	81,255	91,624	185,716
Net investment in direct financing and sales-type leases	554,986	625,541	564,685
Investments in and loans to equity-accounted investments	1,102,386	1,083,741	1,011,530
Other non-current assets	130,200	130,051	141,626
Total Assets	7,345,512	7,683,804	8,126,018
LIABILITIES AND EQUITY
Accounts payable and other current liabilities	441,857	427,640	397,111
Liabilities associated with assets held for sale	—	2,535	—
Short-term debt - Teekay Tankers	10,000	55,000	15,000
Current portion of long-term debt - Teekay Parent	—	60,000	36,663
Current portion of long-term debt - Teekay LNG	366,237	398,839	468,038
Current portion of long-term debt - Teekay Tankers	53,830	55,685	125,661
Long-term debt - Teekay Parent	354,065	351,594	345,768
Long-term debt - Teekay LNG	2,568,258	2,679,835	2,799,426
Long-term debt - Teekay Tankers	661,627	829,671	894,501
Operating lease liabilities	72,982	83,456	173,476
Other long-term liabilities	229,415	252,885	197,749
Equity:
Non-controlling interests	2,058,273	2,085,617	2,005,399
Shareholders of Teekay	528,968	401,047	667,226
Total Liabilities and Equity	7,345,512	7,683,804	8,126,018

Net debt - Teekay Parent ⁽¹⁾	283,233	359,659	305,518
Net debt - Teekay LNG ⁽¹⁾	2,642,020	2,652,436	3,062,276
Net debt - Teekay Tankers ⁽¹⁾	549,347	730,276	994,380


(1)	Net debt is a non-GAAP financial measure and represents short-term debt, current portion of long-term debt and long-term debt, less cash and cash equivalents, and, if applicable, restricted cash.


(2)	Reflects unrealized losses (gains) relating to the change in the mark-to-market value of derivative instruments that are not designated in qualifying hedging relationships for accounting purposes, including those losses (gains) included in the Company's proportionate share of equity income (loss) from joint ventures.


(3)	Foreign currency exchange losses (gains) primarily relate to the Company’s debt denominated in Euros and Norwegian Kroner (NOK) and unrealized losses on cross currency swaps used to economically hedge the principal and interest on NOK bonds.


(5)	Refer to footnote (2) of the Consolidated Statements of Income (Loss) for additional information.


(7)	Other for the three and six months ended June 30, 2020 includes a reduction in freight tax accruals and credit loss provision adjustments to the Company's financial instruments upon adoption of ASU 2016-13.


(2)	Reflects unrealized (gains) losses relating to the change in the mark-to-market value of derivative instruments that are not designated in qualifying hedging relationships for accounting purposes, including those (gains) losses included in the Company's proportionate share of equity income (loss) from joint ventures.


(3)	Foreign currency exchange losses primarily relate to the Company’s debt denominated in Euros and Norwegian Kroner (NOK) and unrealized losses on cross currency swaps used to economically hedge the principal and interest on NOK bonds.


(4)	Refer to footnote (2) of the Summary Consolidated Statements of Income (Loss) for additional information.



		Teekay		Teekay		Teekay		Consolidation		Total
		LNG		Tankers		Parent		Adjustments⁽¹⁾

Revenues		148,205		246,492		88,108		—		482,805

Voyage expenses		(5,329	)	(61,558	)	(9	)	—		(66,896	)
Vessel operating expenses		(28,407	)	(46,218	)	(73,171	)	—		(147,796	)
Time-charter hire expense		(5,368	)	(9,296	)	(3,050	)	—		(17,714	)
Depreciation and amortization		(31,629	)	(29,546	)	(1,761	)	—		(62,936	)
General and administrative expenses		(7,883	)	(9,784	)	(6,001	)	—		(23,668	)
Write-down and gain on sale		—		2,896		(13,565	)	—		(10,669	)
Gain on commencement of sales-type lease		—		—		—		—		—
Restructuring charges		—		—		(4,622	)	—		(4,622	)
Income (loss) from vessel operations		69,589		92,986		(14,071	)	—		148,504

Interest expense		(35,143	)	(13,492	)	(10,667	)	57		(59,245	)
Interest income		1,697		567		107		(57	)	2,314
Realized and unrealized loss on
	non-designated derivative instruments	(8,516	)	(589	)	(165	)	—		(9,270	)
Equity income		32,155		3,188		—		—		35,343
Equity in earnings of subsidiaries ⁽²⁾		—		—		43,704		(43,704	)	—
Income tax recovery		1,804		14,598		773		—		17,175
Foreign exchange (loss) gain		(11,624	)	(87	)	2,789		—		(8,922	)
Other (loss) income – net		(679	)	1,027		(747	)	—		(399	)
Net income		49,283		98,198		21,723		(43,704	)	125,500
Net income attributable to
	non-controlling interests ⁽³⁾	(4,349	)	—		—		(99,428	)	(103,777	)
Net income attributable to shareholders/
	unitholders of publicly-listed entities	44,934		98,198		21,723		(143,132	)	21,723


(1)	Consolidation Adjustments column includes adjustments which eliminate transactions between Teekay LNG, Teekay Tankers and Teekay Parent.


(2)	Teekay Corporation’s proportionate share of the net earnings of its publicly-traded subsidiaries.


(3)	Net income attributable to non-controlling interests in the Teekay LNG column represents the joint venture partners’ share of the net income of its respective consolidated joint ventures. Net income attributable to non-controlling interest in the Consolidation Adjustments column represents the public’s share of the net income of Teekay’s publicly-traded consolidated subsidiaries.



							Teekay
					Corporate		Parent
	FPSOs		Other⁽¹⁾		G&A		Total

Revenues	28,787		59,321		—		88,108

Voyage expenses	(9	)	—		—		(9	)
Vessel operating expenses	(24,404	)	(48,767	)	—		(73,171	)
Time-charter hire expense	(20	)	(3,030	)	—		(3,050	)
Depreciation and amortization	(1,761	)	—		—		(1,761	)
General and administrative expenses	(578	)	—		(5,423	)	(6,001	)
Write-down of vessels ⁽²⁾	(13,565	)	—		—		(13,565	)
Restructuring charges	10		(4,632	)	—		(4,622	)
(Loss) income from vessel operations	(11,540	)	2,892		(5,423	)	(14,071	)

Depreciation and amortization	1,761		—		—		1,761
Amortization of operating lease liability							—
and other	(1,536	)	596		—		(940	)
Write-down of vessels ⁽²⁾	13,565		—		—		13,565
Daughter Entities distributions⁽³⁾	—		—		9,401		9,401
Teekay Parent adjusted EBITDA	2,250		3,488		3,978		9,716


(1)	Includes the results of one chartered-in FSO unit owned by Altera, which is largely on a flow-through basis with Teekay Parent earning a small margin.


(1)	Daughter Entities dividends and distributions for a given quarter consist of the amount of dividends and distributions relating to such quarter but received by Teekay Parent in the following quarter.