Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F. |
Form 20-F ý Form 40- F ¨ |
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1). |
Yes ¨ No ý |
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7). |
Yes ¨ No ý |
TEEKAY OFFSHORE PARTNERS L.P. | |||
By: | Teekay Offshore GP L.L.C., its general partner | ||
Date: August 2, 2018 | By: | /s/ Edith Robinson | |
Edith Robinson Secretary |
• | Reported GAAP net loss attributable to the partners and preferred unitholders of $168.5 million (impacted by $181.4 million of non-cash asset impairments) and adjusted net loss attributable to the partners and preferred unitholders(1) of $0.7 million (excluding items listed in Appendix A to this release) in the second quarter of 2018. |
• | Incurred GAAP loss from vessel operations of $132.0 million (impacted by $181.4 million of non-cash asset impairments) and generated total cash flow from vessel operations(1) of $162.2 million in the second quarter of 2018. |
• | Generated distributable cash flow(1) of $25.3 million, or $0.06 per common unit, in the second quarter of 2018. |
• | Entered into contract extensions for the Voyageur Spirit FPSO to April 2020 and the Petrojarl Cidade de Rio das Ostras (Ostras) FPSO to November 2018, plus extension options. |
• | In July 2018, refinanced 2019 bond maturities and a 2022 promissory note with a $700 million private placement of 8.5% senior unsecured notes maturing in 2023. |
• | In July 2018, entered into shipbuilding contracts to construct two LNG-fueled Aframax DP2 shuttle tanker newbuildings from Samsung Heavy Industries for delivery in late-2020 and early-2021, bringing the Partnership's orderbook to six shuttle tankers. |
Three Months Ended | |||||||
June 30, | March 31, | June 30, | |||||
2018 | 2018 (2) | 2017 | |||||
(in thousands of U.S. Dollars) | (unaudited) | (unaudited) | (unaudited) | ||||
GAAP FINANCIAL COMPARISON | |||||||
Revenues | 320,354 | 323,199 | 264,792 | ||||
(Loss) income from vessel operations | (132,019 | ) | 19,498 | 46,218 | |||
Equity income | 8,346 | 13,998 | 3,425 | ||||
Net (loss) income | (168,492 | ) | 16,060 | (16,466 | ) | ||
Net (loss) income attributable to the partners and preferred unitholders | (168,500 | ) | 23,919 | (20,005 | ) | ||
NON-GAAP FINANCIAL COMPARISON | |||||||
Total cash flow from vessel operations (CFVO) (1) | 162,242 | 161,538 | 134,601 | ||||
Distributable cash flow (DCF) (1) | 25,327 | 39,359 | 27,242 | ||||
Adjusted net (loss) income attributable to the partners and preferred unitholders (1) | (732 | ) | 13,701 | 10,427 |
(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) | Please refer to Appendices to the release announcing the results for the first quarter of 2018 attached as Exhibit 1 to the Form 6-K filed with the Securities and Exchange Commission on May 17, 2018, for a reconciliation of these non-GAAP measures to the most directly comparable financial measures under GAAP. |
Three Months Ended | ||||||||||||||
June 30, 2018 | ||||||||||||||
(in thousands of U.S. Dollars) | (unaudited) | |||||||||||||
FPSO Segment | Shuttle Tanker Segment | FSO Segment | UMS Segment | Towage Segment | Conventional Tanker Segment | Total | ||||||||
GAAP FINANCIAL COMPARISON | ||||||||||||||
Revenues | 124,053 | 142,047 | 33,840 | — | 15,510 | 4,904 | 320,354 | |||||||
(Loss) income from vessel operations | (156,506 | ) | 22,553 | 11,284 | (3,861 | ) | (3,077 | ) | (2,412 | ) | (132,019 | ) | ||
Equity income | 8,346 | — | — | — | — | — | 8,346 | |||||||
NON-GAAP FINANCIAL COMPARISON | ||||||||||||||
CFVO from (used for) consolidated vessels (i) | 56,939 | 61,101 | 24,232 | (2,208 | ) | 2,034 | (2,412 | ) | 139,686 | |||||
CFVO from equity-accounted vessels (i) | 22,556 | — | — | — | — | — | 22,556 | |||||||
Total CFVO (i) | 79,495 | 61,101 | 24,232 | (2,208 | ) | 2,034 | (2,412 | ) | 162,242 | |||||
Three Months Ended | ||||||||||||||
June 30, 2017 | ||||||||||||||
(in thousands of U.S. Dollars) | (unaudited) | |||||||||||||
FPSO Segment | Shuttle Tanker Segment | FSO Segment | UMS Segment | Towage Segment | Conventional Tanker Segment | Total | ||||||||
GAAP FINANCIAL COMPARISON | ||||||||||||||
Revenues | 110,247 | 132,964 | 10,798 | 3,089 | 4,229 | 3,465 | 264,792 | |||||||
Income (loss) from vessel operations | 31,601 | 38,293 | 1,178 | (17,050 | ) | (7,021 | ) | (783 | ) | 46,218 | ||||
Equity income | 3,425 | — | — | — | — | — | 3,425 | |||||||
NON-GAAP FINANCIAL COMPARISON | ||||||||||||||
CFVO from (used for) consolidated vessels (i) | 64,015 | 68,063 | 6,719 | (6,528 | ) | (3,446 | ) | (783 | ) | 128,040 | ||||
CFVO from equity-accounted vessels (i) | 6,561 | — | — | — | — | — | 6,561 | |||||||
Total CFVO (i) | 70,576 | 68,063 | 6,719 | (6,528 | ) | (3,446 | ) | (783 | ) | 134,601 |
(i) | 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 GAAP. |
Number of Vessels | ||||||||||||
Owned Vessels | Chartered-in Vessels | Committed Newbuildings | Total | |||||||||
FPSO Segment | 8 | (i) | — | — | 8 | |||||||
Shuttle Tanker Segment | 29 | (ii) | 2 | 6 | (iii) | 37 | ||||||
FSO Segment | 6 | — | — | 6 | ||||||||
UMS Segment | 1 | — | — | 1 | ||||||||
Towage Segment | 10 | — | — | 10 | ||||||||
Conventional Segment | — | 2 | — | 2 | ||||||||
Total | 54 | 4 | 6 | 64 |
(i) | Includes two FPSO units, the Cidade de Itajai and Pioneiro de Libra, in which Teekay Offshore’s ownership interest is 50 percent. |
(ii) | Includes six shuttle tankers in which Teekay Offshore’s ownership interest is 50 percent and one HiLoad DP unit. |
(iii) | Includes six DP2 shuttle tanker newbuildings scheduled for delivery in late-2019 through early-2021, two of which will operate under Teekay Offshore's master agreement with Equinor (formerly Statoil) and four of which will join Teekay Offshore's CoA portfolio in the North Sea. |
• | By dialing 1-888-394-8218 or 647-484-0475, if outside North America, and quoting conference ID code 9279971. |
• | By accessing the webcast, which will be available on Teekay Offshore's website at www.teekay.com (the archive will remain on the website for a period of one year). |
Three Months Ended | Six Months Ended | ||||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | |||||||
2018 | 2018 | 2017 | 2018 | 2017 | |||||||
(unaudited) | (unaudited) | (unaudited) | (unaudited) | (unaudited) | |||||||
Revenues (1) | 320,354 | 323,199 | 264,792 | 643,553 | 540,930 | ||||||
Voyage expenses (1) | (36,486 | ) | (35,006 | ) | (20,196 | ) | (71,492 | ) | (45,337 | ) | |
Vessel operating expenses (1) | (110,298 | ) | (115,382 | ) | (89,705 | ) | (225,680 | ) | (168,695 | ) | |
Time-charter hire expenses | (13,464 | ) | (12,727 | ) | (19,507 | ) | (26,191 | ) | (41,263 | ) | |
Depreciation and amortization (2) | (95,440 | ) | (94,304 | ) | (74,287 | ) | (189,744 | ) | (149,013 | ) | |
General and administrative | (17,890 | ) | (17,786 | ) | (13,379 | ) | (35,676 | ) | (27,996 | ) | |
(Write-down) and gain on sale of vessels (3) | (178,795 | ) | (28,496 | ) | (1,500 | ) | (207,291 | ) | (1,500 | ) | |
Restructuring charge | — | — | — | — | (450 | ) | |||||
(Loss) income from vessel operations | (132,019 | ) | 19,498 | 46,218 | (112,521 | ) | 106,676 | ||||
Interest expense | (49,662 | ) | (41,573 | ) | (36,602 | ) | (91,235 | ) | (72,706 | ) | |
Interest income | 734 | 658 | 406 | 1,392 | 752 | ||||||
Realized and unrealized gain (loss) | |||||||||||
on derivative instruments (4) | 9,441 | 34,450 | (21,797 | ) | 43,892 | (28,329 | ) | ||||
Equity income | 8,346 | 13,998 | 3,425 | 22,344 | 7,900 | ||||||
Foreign currency exchange loss (5) | (3,860 | ) | (1,943 | ) | (6,564 | ) | (5,803 | ) | (6,787 | ) | |
Other expense - net | (592 | ) | (3,270 | ) | (1,134 | ) | (3,863 | ) | (912 | ) | |
(Loss) income before income tax expense | (167,612 | ) | 21,818 | (16,048 | ) | (145,794 | ) | 6,594 | |||
Income tax expense | (880 | ) | (5,758 | ) | (418 | ) | (6,638 | ) | (1,797 | ) | |
Net (loss) income | (168,492 | ) | 16,060 | (16,466 | ) | (152,432 | ) | 4,797 | |||
Non-controlling interests in net (loss) income | 8 | (7,859 | ) | 3,539 | (7,852 | ) | 5,911 | ||||
Preferred unitholders' interest in net (loss) income | 8,038 | 7,370 | 12,386 | 15,409 | 24,772 | ||||||
General partner’s interest in net (loss) income | (1,342 | ) | 126 | (648 | ) | (1,217 | ) | (518 | ) | ||
Limited partners’ interest in net (loss) income | (175,196 | ) | 16,423 | (31,743 | ) | (158,772 | ) | (25,368 | ) | ||
Weighted-average number of common units: | |||||||||||
- basic | 410,310,586 | 410,101,480 | 151,364,950 | 410,206,610 | 150,006,972 | ||||||
- diluted | 410,310,586 | 475,447,576 | 151,364,950 | 410,206,610 | 150,006,972 | ||||||
Total number of common units outstanding | |||||||||||
at end of period | 410,314,977 | 410,260,795 | 153,858,292 | 410,314,977 | 153,858,292 |
(1) | Effective January 1, 2018, the Partnership adopted the new revenue accounting standard, which resulted in increasing revenues by $15.8 million and $31.9 million for the three and six months ended June 30, 2018, respectively, increasing voyage expenses by $3.0 million and $6.3 million for the three and six months ended June 30, 2018, respectively, and increasing vessel operating expenses by $12.8 million and $25.6 million for the three and six months ended June 30, 2018, respectively. These gross-up adjustments had no impact on net loss for the three and six months ended June 30, 2018. |
(2) | The Partnership's shuttle tankers are comprised of two components: i) a conventional tanker (the “tanker component”) and ii) specialized shuttle equipment (the “shuttle component”). The Partnership differentiated these two components on the principle that a shuttle tanker can also operate as a conventional tanker without the use of the shuttle component. The economics of this alternate use depend on the supply and demand fundamentals in the two segments. Historically, the Partnership has assessed the useful life of the tanker component as being 25 years and the shuttle component as being 20 years. During the three months ended March 31, 2018, the Partnership has considered challenges associated with shuttle tankers that have approached 20 years of age in recent years and has reassessed the useful life of the tanker component to be 20 years. This change in estimate, commencing January 1, 2018, impacts 21 vessels in the Partnership's shuttle tanker fleet. Separately, the Partnership has reviewed the residual value for seven vessels in its fleet that are 17 years of age or older and, as a result of a change in current estimated recycling values, has decreased the residual value for these vessels. The effect of these changes in estimates increased depreciation expense and decreased net income by $5.4 million and $10.8 million for the three and six months ended June 30, 2018, respectively. |
(3) | During the three months ended June 30, 2018, the Partnership incurred a write-down of $181.4 million, mainly related to the Piranema Spirit and Ostras FPSO units as a result of a reassessment of the future redeployment assumptions for both units. In June 2018, the Partnership sold a 1998-built shuttle tanker, the Navion Britannia, for net proceeds of $10.4 million, and recorded a gain on sale of $2.6 million in the Partnership's shuttle tanker segment. |
(4) | Realized loss on derivative instruments relates to amounts the Partnership actually paid to settle derivative instruments, and the unrealized gain (loss) on derivative instruments relates to the change in fair value of such derivative instruments, as detailed in the table below: |
Three Months Ended | Six Months Ended | ||||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | |||||||
2018 | 2018 | 2017 | 2018 | 2017 | |||||||
Realized (loss) gain relating to: | |||||||||||
Interest rate swaps | (5,843 | ) | (17,143 | ) | (10,296 | ) | (22,986 | ) | (20,962 | ) | |
Foreign currency forward contracts | 370 | 618 | (309 | ) | 988 | (410 | ) | ||||
(5,473 | ) | (16,525 | ) | (10,605 | ) | (21,998 | ) | (21,372 | ) | ||
Unrealized gain (loss) relating to: | |||||||||||
Interest rate swaps | 18,674 | 49,300 | (12,871 | ) | 67,974 | (9,367 | ) | ||||
Foreign currency forward contracts | (3,760 | ) | 1,675 | 1,679 | (2,084 | ) | 2,410 | ||||
14,914 | 50,975 | (11,192 | ) | 65,890 | (6,957 | ) | |||||
Total realized and unrealized gain (loss) on | |||||||||||
derivative instruments | 9,441 | 34,450 | (21,797 | ) | 43,892 | (28,329 | ) |
(5) | The Partnership entered into cross currency swaps to economically hedge the foreign currency exposure on the payment of interest and repayment of principal amounts of the Partnership’s Norwegian Kroner (NOK) bonds. In addition, the cross currency swaps economically hedge the interest rate exposure on the NOK bonds. The Partnership has not designated, for accounting purposes, these cross currency swaps as cash flow hedges of its NOK bonds and, thus, foreign currency exchange loss includes a realized loss relating to the amounts the Partnership paid to settle its non-designated cross currency swaps and an unrealized (loss) gain relating to the change in fair value of such swaps, partially offset by an unrealized gain (loss) on the revaluation of the NOK bonds, as detailed in the table below. In July 2018, the Partnership used a portion of the net proceeds from the issuance of the Notes to repurchase approximately NOK 910 million of the NOK 1,000 million aggregate principal of its NOK bonds and terminated NOK 905 million of the associated NOK 1,000 million aggregate notional amount of the cross currency swaps, resulting in a cash settlement of approximately $40 million on the cross currency swap termination. |
Three Months Ended | Six Months Ended | |||||||||
June 30, | March 31, | June 30, | June 30, | June 30, | ||||||
2018 | 2018 | 2017 | 2018 | 2017 | ||||||
Realized loss on cross currency swaps | (1,444 | ) | (1,293 | ) | (3,310 | ) | (2,737 | ) | (6,514 | ) |
Unrealized (loss) gain on cross currency swaps | (4,433 | ) | 6,338 | 8,111 | 1,905 | 12,490 | ||||
Unrealized gain (loss) on revaluation of NOK bonds | 4,791 | (5,641 | ) | (7,797 | ) | (850 | ) | (9,058 | ) |
As at | As at | As at | |||||
June 30, 2018 | March 31, 2018 | December 31, 2017 | |||||
(unaudited) | (unaudited) | (unaudited) | |||||
ASSETS | |||||||
Current | |||||||
Cash and cash equivalents | 241,202 | 225,892 | 221,934 | ||||
Restricted cash | 12,425 | 15,814 | 28,360 | ||||
Accounts receivable | 134,931 | 137,054 | 162,691 | ||||
Vessels held for sale | 8,000 | — | — | ||||
Prepaid expenses | 37,011 | 36,815 | 30,336 | ||||
Due from affiliates | 51,249 | 39,871 | 37,376 | ||||
Other current assets | 10,644 | 10,107 | 29,249 | ||||
Total current assets | 495,462 | 465,553 | 509,946 | ||||
Vessels and equipment | |||||||
At cost, less accumulated depreciation | 4,388,304 | 4,457,170 | 4,398,836 | ||||
Advances on newbuilding contracts and conversion costs | 17,742 | 225,129 | 288,658 | ||||
Investment in equity accounted joint ventures | 195,082 | 187,304 | 169,875 | ||||
Deferred tax asset | 22,674 | 24,222 | 28,110 | ||||
Other assets | 177,254 | 185,686 | 113,225 | ||||
Goodwill | 129,145 | 129,145 | 129,145 | ||||
Total assets | 5,425,663 | 5,674,209 | 5,637,795 | ||||
LIABILITIES AND EQUITY | |||||||
Current | |||||||
Accounts payable | 12,020 | 11,677 | 43,317 | ||||
Accrued liabilities | 142,147 | 200,951 | 187,687 | ||||
Deferred revenues | 55,786 | 51,811 | 69,668 | ||||
Due to affiliates | 57,331 | 72,361 | 108,483 | ||||
Current portion of derivative instruments | 62,273 | 58,333 | 42,515 | ||||
Current portion of long-term debt | 473,691 | 684,118 | 589,767 | ||||
Other current liabilities | 10,437 | 7,849 | 9,056 | ||||
Total current liabilities | 813,685 | 1,087,100 | 1,050,493 | ||||
Long-term debt | 2,492,517 | 2,425,126 | 2,533,961 | ||||
Derivative instruments | 83,211 | 97,167 | 167,469 | ||||
Due to affiliates | 290,959 | 164,195 | 163,037 | ||||
Other long-term liabilities | 281,798 | 258,262 | 249,336 | ||||
Total liabilities | 3,962,170 | 4,031,850 | 4,164,296 | ||||
Redeemable non-controlling interest | — | — | (29 | ) | |||
Equity | |||||||
Limited partners - common units | 879,437 | 1,058,848 | 1,004,077 | ||||
Limited partners - preferred units | 384,274 | 384,923 | 266,925 | ||||
General Partner | 15,032 | 16,405 | 15,996 | ||||
Warrants | 132,225 | 132,225 | 132,225 | ||||
Accumulated other comprehensive income (loss) | 6,213 | 2,989 | (523 | ) | |||
Non-controlling interests | 46,312 | 46,969 | 54,828 | ||||
Total equity | 1,463,493 | 1,642,359 | 1,473,528 | ||||
Total liabilities and total equity | 5,425,663 | 5,674,209 | 5,637,795 |
Six Months Ended | ||||
June 30, 2018 | June 30, 2017 | |||
(unaudited) | (unaudited) | |||
Cash, cash equivalents and restricted cash provided by (used for) | ||||
OPERATING ACTIVITIES | ||||
Net (loss) income | (152,432 | ) | 4,797 | |
Non-cash items: | ||||
Unrealized gain on derivative instruments | (67,795 | ) | (5,526 | ) |
Equity income, net of dividends received of $4,700 (2017 - $7,000) | (17,644 | ) | (900 | ) |
Depreciation and amortization | 189,744 | 149,013 | ||
Write-down and (gain) on sale of vessels | 207,291 | 1,500 | ||
Deferred income tax expense | 5,435 | 762 | ||
Amortization of in-process revenue contracts | (6,101 | ) | (6,319 | ) |
Unrealized foreign currency exchange (gain) loss and other | (992 | ) | 35,143 | |
Change in non-cash working capital items related to operating activities | (70,456 | ) | 14,909 | |
Expenditures for dry docking | (9,995 | ) | (2,815 | ) |
Net operating cash flow | 77,055 | 190,564 | ||
FINANCING ACTIVITIES | ||||
Proceeds from long-term debt | 226,520 | 207,464 | ||
Scheduled repayments of long-term debt | (345,970 | ) | (263,169 | ) |
Prepayments of long-term debt | (40,000 | ) | — | |
Debt issuance costs | (8,346 | ) | (2,214 | ) |
Proceeds from credit facility due to affiliates | 125,000 | — | ||
Proceeds from issuance of preferred units | 120,000 | — | ||
Proceeds from issuance of common units | — | 585 | ||
Expenses relating to equity offerings | (3,997 | ) | (212 | ) |
Cash distributions paid by the Partnership | (22,330 | ) | (34,412 | ) |
Cash distributions paid by subsidiaries to non-controlling interests | (664 | ) | (660 | ) |
Other | (715 | ) | (483 | ) |
Net financing cash flow | 49,498 | (93,101 | ) | |
INVESTING ACTIVITIES | ||||
Net payments for vessels and equipment, including advances on newbuilding contracts and conversion costs | (160,175 | ) | (118,601 | ) |
Proceeds from sale of vessels and equipment | 10,410 | — | ||
Direct financing lease payments received | 2,991 | 3,177 | ||
Investment in equity accounted joint ventures | (1,700 | ) | (12,339 | ) |
Acquisition of companies from Teekay Corporation (net of cash acquired of $26.6 million) | 25,254 | — | ||
Net investing cash flow | (123,220 | ) | (127,763 | ) |
Increase (decrease) in cash, cash equivalents and restricted cash | 3,333 | (30,300 | ) | |
Cash, cash equivalents and restricted cash, beginning of the period | 250,294 | 342,287 | ||
Cash, cash equivalents and restricted cash, end of the period | 253,627 | 311,987 |
Three Months Ended | ||||||
June 30, 2018 | June 30, 2017 | |||||
(unaudited) | (unaudited) | |||||
Net loss – GAAP basis | (168,492 | ) | (16,466 | ) | ||
Adjustments: | ||||||
Net income attributable to non-controlling interests | (8 | ) | (3,539 | ) | ||
Net loss attributable to the partners and preferred unitholders | (168,500 | ) | (20,005 | ) | ||
Add (subtract) specific items affecting net loss: | ||||||
Write-down and gain on sale of vessels (1) | 178,795 | 1,500 | ||||
Foreign currency exchange loss (2) | 2,910 | 3,254 | ||||
Other (3) | 1,209 | 4,170 | ||||
Pre-operational costs (4) | 266 | 1,788 | ||||
Unrealized (gain) loss on derivative instruments (5) | (15,122 | ) | 10,832 | |||
Termination of Arendal Spirit UMS charter contract (6) | — | 8,888 | ||||
Non-controlling interests' share of items above (7) | (290 | ) | — | |||
Total adjustments | 167,768 | 30,432 | ||||
Adjusted net (loss) income attributable to the partners and preferred unitholders | (732 | ) | 10,427 |
(1) | See footnote (3) of the summary consolidated statements of (loss) income included in this release for further details. |
(2) | Foreign currency exchange loss primarily relates to the Partnership’s revaluation of all foreign currency-denominated monetary assets and liabilities based on the prevailing exchange rate at the end of each reporting period, including revaluation of all foreign-currency-denominated monetary assets and liabilities within the equity accounted joint ventures and the unrealized gain or loss related to the Partnership’s cross currency swaps related to the Partnership's NOK bonds and excludes the realized gain or loss relating to the Partnership's cross currency swaps. |
(3) | Other items for the three months ended June 30, 2018 include a decrease in the deferred income tax asset for the Partnership's Norwegian tax structures. Other items for the three months ended June 30, 2017 includes an increase in the Piranema Spirit FPSO rate reduction contingency and an increase in accrual relating to potential damages resulting from the cancellation of the UMS newbuildings, partially offset by an increase in the deferred income tax asset for the Partnership's Norwegian tax structures. |
(4) | Reflects depreciation and amortization expense, general and administrative expenses and vessel operating expenses relating to the Petrojarl I FPSO unit while undergoing upgrades. |
(5) | Reflects the net unrealized (gain) loss due to changes in the mark-to-market value of interest rate swaps and foreign currency forward contracts that are not designated as hedges for accounting purposes, hedge ineffectiveness from derivative instruments designated as hedges for accounting purposes, the unrealized mark-to-market value of the interest rate swaps within the Cidade de Itajai FPSO equity-accounted joint venture and hedge ineffectiveness within the Pioneiro de Libra FPSO equity accounted joint venture. |
(6) | Includes the write-off of deferred revenues and operating expenses as a result of the termination of the Arendal Spirit UMS charter contract in late-April 2017. |
(7) | Items affecting net loss include amounts attributable to the Partnership’s consolidated non-wholly-owned subsidiaries. Each item affecting net loss is analyzed to determine whether any of the amounts originated from a consolidated non-wholly-owned subsidiary. Each amount that originates from a consolidated non-wholly-owned subsidiary is multiplied by the non-controlling interests’ percentage share in this subsidiary to arrive at the non-controlling interests’ share of the amount. The amount identified as “non-controlling interests’ share of items above” in the table above is the cumulative amount of the non-controlling interests’ proportionate share of items affecting net loss listed in the table. |
Three Months Ended | ||||||
June 30, | ||||||
2018 | 2017 | |||||
(unaudited) | (unaudited) | |||||
Net loss | (168,492 | ) | (16,466 | ) | ||
Add (subtract): | ||||||
Write-down and gain on sale of vessels (1) | 178,795 | 1,500 | ||||
Depreciation and amortization | 95,440 | 74,287 | ||||
Partnership's share of equity accounted joint venture's distributable cash flow net of estimated maintenance capital expenditures (2) | 11,091 | 4,422 | ||||
Deferred income tax expense (recovery) | 1,213 | (674 | ) | |||
Amortization of non-cash portion of revenue contracts | (4,205 | ) | (3,997 | ) | ||
Distributions on preferred units | (8,038 | ) | (12,386 | ) | ||
Equity income | (8,346 | ) | (3,425 | ) | ||
Unrealized (loss) gain on non-designated derivative instruments (3) | (14,914 | ) | 11,192 | |||
Estimated maintenance capital expenditures | (53,320 | ) | (32,676 | ) | ||
Unrealized foreign exchange and other, net | 511 | 12,213 | ||||
Distributable cash flow before non-controlling interests | 29,735 | 33,990 | ||||
Non-controlling interests' share of DCF | (4,408 | ) | (6,748 | ) | ||
Distributable Cash Flow | 25,327 | 27,242 | ||||
Amount attributable to the General Partner | (31 | ) | (31 | ) | ||
Limited Partners' Distributable Cash Flow | 25,296 | 27,211 | ||||
Weighted-average number of common units outstanding | 410,310,586 | 151,364,950 | ||||
Distributable Cash Flow per Limited Partner Unit | 0.06 | 0.18 |
(1) | See footnote (3) of the summary consolidated statements of (loss) income included in this release for further details. |
(2) | Estimated maintenance capital expenditures relating to the Partnership’s equity-accounted joint ventures were $5.5 million and $1.0 million for the three months ended June 30, 2018 and 2017, respectively. |
(3) | Derivative instruments include interest rate swaps and foreign currency forward contracts. |
Three Months Ended June 30, 2018 | ||||||||||||||
(unaudited) | ||||||||||||||
FPSO Segment | Shuttle Tanker Segment | FSO Segment | UMS Segment | Towage Segment | Conventional Tanker Segment | Total | ||||||||
Revenues | 124,053 | 142,047 | 33,840 | — | 15,510 | 4,904 | 320,354 | |||||||
Voyage expenses | — | (26,951 | ) | (202 | ) | (4 | ) | (6,290 | ) | (3,039 | ) | (36,486 | ) | |
Vessel operating expenses | (55,040 | ) | (37,982 | ) | (10,360 | ) | (893 | ) | (6,023 | ) | — | (110,298 | ) | |
Time-charter hire expenses | — | (9,277 | ) | — | — | — | (4,187 | ) | (13,464 | ) | ||||
Depreciation and amortization | (37,179 | ) | (39,840 | ) | (11,643 | ) | (1,653 | ) | (5,125 | ) | — | (95,440 | ) | |
General and administrative | (8,140 | ) | (6,849 | ) | (351 | ) | (1,311 | ) | (1,149 | ) | (90 | ) | (17,890 | ) |
(Write-down) and gain on sale of vessels | (180,200 | ) | 1,405 | — | — | — | — | (178,795 | ) | |||||
(Loss) income from vessel operations | (156,506 | ) | 22,553 | 11,284 | (3,861 | ) | (3,077 | ) | (2,412 | ) | (132,019 | ) | ||
Three Months Ended June 30, 2017 | ||||||||||||||
(unaudited) | ||||||||||||||
FPSO Segment | Shuttle Tanker Segment | FSO Segment | UMS Segment | Towage Segment | Conventional Tanker Segment | Total | ||||||||
Revenues | 110,247 | 132,964 | 10,798 | 3,089 | 4,229 | 3,465 | 264,792 | |||||||
Voyage expenses | — | (17,319 | ) | (430 | ) | — | (2,409 | ) | (38 | ) | (20,196 | ) | ||
Vessel operating expenses | (35,079 | ) | (28,410 | ) | (4,693 | ) | (17,333 | ) | (4,190 | ) | — | (89,705 | ) | |
Time-charter hire expenses | — | (15,387 | ) | — | — | — | (4,120 | ) | (19,507 | ) | ||||
Depreciation and amortization | (36,497 | ) | (30,049 | ) | (2,588 | ) | (1,634 | ) | (3,519 | ) | — | (74,287 | ) | |
General and administrative | (7,070 | ) | (3,506 | ) | (409 | ) | (1,172 | ) | (1,132 | ) | (90 | ) | (13,379 | ) |
Write-down of vessels | — | — | (1,500 | ) | — | — | — | (1,500 | ) | |||||
Income (loss) from vessel operations | 31,601 | 38,293 | 1,178 | (17,050 | ) | (7,021 | ) | (783 | ) | 46,218 |
Three Months Ended | |||||||||||||||
June 30, 2018 | |||||||||||||||
(unaudited) | |||||||||||||||
Shuttle | Conventional | ||||||||||||||
FPSO | Tanker | FSO | UMS | Towage | Tanker | ||||||||||
Segment | Segment | Segment | Segment | Segment | Segment | Total | |||||||||
(Loss) income from vessel operations | |||||||||||||||
(See Appendix C) | (156,506 | ) | 22,553 | 11,284 | (3,861 | ) | (3,077 | ) | (2,412 | ) | (132,019 | ) | |||
Depreciation and amortization | 37,179 | 39,840 | 11,643 | 1,653 | 5,125 | — | 95,440 | ||||||||
Realized gain (loss) from the | |||||||||||||||
settlements of non-designated | |||||||||||||||
foreign currency forward contracts | 271 | 113 | — | — | (14 | ) | — | 370 | |||||||
Amortization of non-cash portion of | |||||||||||||||
revenue contracts | (4,205 | ) | — | — | — | — | — | (4,205 | ) | ||||||
Write-down and (gain) on sale of vessels | 180,200 | (1,405 | ) | — | — | — | — | 178,795 | |||||||
Falcon Spirit revenue accounted for | |||||||||||||||
as a direct financing lease | — | — | (291 | ) | — | — | — | (291 | ) | ||||||
Falcon Spirit cash flow from | |||||||||||||||
time-charter contracts | — | — | 1,596 | — | — | — | 1,596 | ||||||||
Cash flow from (used for) vessel | |||||||||||||||
operations from consolidated vessels | 56,939 | 61,101 | 24,232 | (2,208 | ) | 2,034 | (2,412 | ) | 139,686 |
Three Months Ended | |||||||||||||||
June 30, 2017 | |||||||||||||||
(unaudited) | |||||||||||||||
Shuttle | Conventional | ||||||||||||||
FPSO | Tanker | FSO | UMS | Towage | Tanker | ||||||||||
Segment | Segment | Segment | Segment | Segment | Segment | Total | |||||||||
Income (loss) from vessel operations | |||||||||||||||
(See Appendix C) | 31,601 | 38,293 | 1,178 | (17,050 | ) | (7,021 | ) | (783 | ) | 46,218 | |||||
Depreciation and amortization | 36,497 | 30,049 | 2,588 | 1,634 | 3,519 | — | 74,287 | ||||||||
Realized (loss) gain from the | |||||||||||||||
settlements of non-designated | |||||||||||||||
foreign currency forward contracts | (86 | ) | (279 | ) | — | — | 56 | — | (309 | ) | |||||
Amortization of non-cash portion of | |||||||||||||||
revenue contracts | (3,997 | ) | — | — | — | — | — | (3,997 | ) | ||||||
Termination of Arendal Spirit UMS | |||||||||||||||
charter contract | — | — | — | 8,888 | — | — | 8,888 | ||||||||
Write-down of vessels | — | — | 1,500 | — | — | — | 1,500 | ||||||||
Falcon Spirit revenue accounted for | |||||||||||||||
as a direct financing lease | — | — | (366 | ) | — | — | — | (366 | ) | ||||||
Falcon Spirit cash flow from | |||||||||||||||
time-charter contracts | — | — | 1,819 | — | — | — | 1,819 | ||||||||
Cash flow from (used for) vessel | |||||||||||||||
operations from consolidated vessels | 64,015 | 68,063 | 6,719 | (6,528 | ) | (3,446 | ) | (783 | ) | 128,040 |
Three Months Ended | Three Months Ended | ||||||||
June 30, 2018 | June 30, 2017 | ||||||||
(unaudited) | (unaudited) | ||||||||
At 100% | Partnership's 50% | At 100% | Partnership's 50% | ||||||
Revenues | 61,794 | 30,897 | 23,653 | 11,827 | |||||
Vessel and other operating expenses | (16,682 | ) | (8,341 | ) | (10,532 | ) | (5,266 | ) | |
Depreciation and amortization | (15,455 | ) | (7,728 | ) | (4,400 | ) | (2,200 | ) | |
Income from vessel operations of equity-accounted vessels | 29,657 | 14,828 | 8,721 | 4,361 | |||||
Net interest expense (1) | (11,849 | ) | (5,925 | ) | (1,859 | ) | (930 | ) | |
Realized and unrealized gain (loss) on derivative instruments (2) | 357 | 179 | (273 | ) | (137 | ) | |||
Foreign currency exchange (loss) gain | (987 | ) | (494 | ) | 85 | 43 | |||
Total other items | (12,479 | ) | (6,240 | ) | (2,047 | ) | (1,024 | ) | |
Net income / equity income of equity-accounted vessels before income tax expense | 17,178 | 8,588 | 6,674 | 3,337 | |||||
Income tax (expense) recovery | (484 | ) | (242 | ) | 175 | 88 | |||
Net income / equity income of equity-accounted vessels | 16,694 | 8,346 | 6,849 | 3,425 | |||||
Income from vessel operations of equity-accounted vessels | 29,657 | 14,828 | 8,721 | 4,361 | |||||
Depreciation and amortization | 15,455 | 7,728 | 4,400 | 2,200 | |||||
Cash flow from vessel operations from equity-accounted vessels | 45,112 | 22,556 | 13,121 | 6,561 |
(1) | Net interest expense for the three months ended June 30, 2018 includes a realized loss of $0.6 million ($0.3 million at the Partnership's 50% share) related to interest rate swaps designated and qualifying as cash flow hedges for the Pioneiro de Libra FPSO unit. |
(2) | Realized and unrealized gain (loss) on derivative instruments for the three months ended June 30, 2018 and 2017 includes an unrealized gain of $0.4 million ($0.2 million at the Partnership’s 50% share) and $0.9 million ($0.4 million at the Partnership’s 50% share), respectively, related to interest rate swaps for the Cidade de Itajai FPSO unit. |