Teekay Tankers remains in the red

Aug 02 2019

Teekay Tankers has reported a GAAP net loss of $14.3 mill, and an adjusted net loss of $12.1 mill in the second quarter of 2019.

The total adjusted EBITDA was $36.2 mill.

Lower average spot tanker rates and more scheduled drydockings in 2Q19 affected the results, compared to the previous quarter, the company said.

However, 2Q19 GAAP net loss and non-GAAP adjusted net loss improved compared to the GAAP net loss and non-GAAP adjusted net loss for the same period in 2018, due primarily to higher average spot tanker rates, partially offset by more scheduled drydockings and higher interest expense associated with the three sale-leaseback transactions that were completed between September, 2018 and May, 2019.

Kevin Mackay, Teekay Tankers’ President and CEO, said; “As expected, crude tanker spot rates declined during the second quarter of 2019, mainly due to seasonal factors and some near-term headwinds; however, crude tanker spot rates were up compared to the same period of the prior year, reflecting tighter market fundamentals, and were the highest second quarter rates since 2016.

“Lower OPEC oil production and heavier than normal refinery maintenance as refineries prepare for the implementation of the new IMO2020 standards impacted crude tanker demand, which we expect will continue into the early part of the third quarter.

“However, these headwinds were partially offset by continued strong growth of US crude oil exports, which bolstered our full-service lightering business and drove our Aframax crude tanker spot rates to average over $20,000 per day during the second quarter, which was above our peer group and benchmarks. We expect this strength to continue into the third quarter as additional pipeline capacity comes online, allowing US crude oil exports to further increase.

“We continue to believe that tanker market fundamentals support a market recovery in the latter part of the year and into 2020, due to projected underlying oil demand growth, an expected increase in US crude oil exports, significantly higher refinery throughput ahead of IMO2020 regulations, and lower tanker fleet growth. With healthy liquidity, a market-leading position and significant operating leverage, we believe we are well-positioned to benefit from a tanker market recovery,” he concluded.


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