Teekay Profits Up On Higher LNGC Charters

Bermuda-registered LNG carrier operator Teekay LNG Partners has reported a $16.4mn net income for the second quarter, up from a mere $2.7mn in the corresponding 2018 period.

However, income was down on the $21.6mn Teekay recorded in this year’s first quarter, the company said in an August 1 report.

Results yr/yr were buoyed by revenues generated by nine new LNG carriers added to Teekay’s fleet since May 2018 as well as expanded earnings from the Torben Spirit LNG tanker, following its redeployment under an increased charter rate.

Teekay also benefited from lower vessel operating costs, reduced general and administrative expenses and higher revenues at its seven multi-gas tankers. But weaker earnings from the company’s conventional tanker fleet owing to the  sale of three ships in late 2018 and early 2019 was a drag on performance.

Overall adjusted Ebitda came to $162mn in the three-month period, up from $158.2mn in the first quarter and $115mn in the second quarter of 2018. Meanwhile distributable cash flow came to $56.3mn in April through June, compared with $54.2mn in the previous quarter and $31.1mn in the year-earlier quarter.

“Our financial results improved again this quarter compared to both the previous quarter and the same quarter last year due to recent newbuilding deliveries and higher charter rates on certain LNG carriers,” Mark Kremin, CEO of Tekkay Gas Group, said in a statement. He noted that these factors were “partially offset by an increase in drydocks and waiting times prior to the commencement of recently secured LNG charters at higher rates.”

Teekay expects to see further gains during the second half now that new charters have started, increasing its utilisation and revenues. Fewer drydocks, the delivery of another three 50%-owned Yamal Arc-7 winterised carriers and the launch of the Bahrain LNG terminal should also lift performance.