Author Topic: TOO - Teekay Offshore Partners L.P.  (Read 23941 times)

whistlerbumps

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Re: TOO - Teekay Offshore Partners L.P.
« Reply #140 on: February 13, 2019, 11:38:38 AM »
I think a key question is whether the "normalized" cash flow is at all real. 

Thus I have been trying to tie EBITDA to reported CFO but been struggling (see attached) .  Can anyone think of something here that I am missing? 

I've also then attempted to go from reported CFO to "normalized" OCF.  However, I wonder how much of the swap losses are actually ongoing costs of the business given their debt and hedging program.  What do people think about the ongoing nature of those charges? I have also removed the 55mln Petrobras payment as I don't believe that should be considered part of normal operations.

Finally, I've estimated replacement capex for their existing assets as ~ a 20 year life on the balance sheet value of their PP&E+newbuilds+investment in JVs.  I'd be interested to hear what people think of these assumptions.


Net-net, it seems attractive on a "normalized FCF basis" but you have to believe in a lot of adjustments to get to normalized.

« Last Edit: February 13, 2019, 11:46:58 AM by whistlerbumps »


5xEBITDA

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Re: TOO - Teekay Offshore Partners L.P.
« Reply #141 on: February 13, 2019, 11:55:28 AM »
Look at page 6 of the FY17 20-F and see if that answers your question

whistlerbumps

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Re: TOO - Teekay Offshore Partners L.P.
« Reply #142 on: February 13, 2019, 12:11:12 PM »
Thanks.  That's what I have been trying to do with the similar chart in the Q4 results but it doesn't quite tie.  Also, the more important question for me is the 2018 results where there is 60mln of cash outflow that I am missing.... 2017 is much closer once you adjust for the 22mln of deferred mobilization revenue and costs.


« Last Edit: February 13, 2019, 12:17:21 PM by whistlerbumps »

heth247

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Re: TOO - Teekay Offshore Partners L.P.
« Reply #143 on: February 13, 2019, 01:10:00 PM »
Thanks.  That's what I have been trying to do with the similar chart in the Q4 results but it doesn't quite tie.  Also, the more important question for me is the 2018 results where there is 60mln of cash outflow that I am missing.... 2017 is much closer once you adjust for the 22mln of deferred mobilization revenue and costs.

Could the 60M be due to the "Adjusted EBITDA from equity-accounted vessels"?  They included 92M for it in the calculation of adjusted ebidta of 782M, but only account 33M in "Equity income" in operation cash flow.  And in 2017 we don't have those JV vessels contributing.

Btw, I think for the normalized FCF calculation, we should include those JVs income, they are significant.  E.g. TGP has lots of those JVs.
« Last Edit: February 13, 2019, 01:17:54 PM by heth247 »

whistlerbumps

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Re: TOO - Teekay Offshore Partners L.P.
« Reply #144 on: February 13, 2019, 01:20:37 PM »
Its possible but I think that's in my numbers... There was actually 33.4mln of equity income in 2017 adjusted EBITDA and I think the difference between reported equity income in EBITDA and equity income cash flow is reported in CFO and my numbers as the equity income outflow of 33.3mln.

heth247

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Re: TOO - Teekay Offshore Partners L.P.
« Reply #145 on: February 13, 2019, 02:21:44 PM »
Its possible but I think that's in my numbers... There was actually 33.4mln of equity income in 2017 adjusted EBITDA and I think the difference between reported equity income in EBITDA and equity income cash flow is reported in CFO and my numbers as the equity income outflow of 33.3mln.

Maybe I don't quite understand it (since Im not an accountant), if you want to make it clean to exclude the equity adjusted ebitda + income, then shouldn't you start with the "consolidated adjusted ebitda" of $706M, instead of the 782M, as the top line of your spread sheet for 2018? Then you need to remove your own line of adjusting the (33.3M) for equity income because that's already subtracted in CFO calculation. After these two changes to your spread sheet, then you will end up with 24.2M as the delta for 2018, instead of 66.8M.
« Last Edit: February 13, 2019, 02:33:53 PM by heth247 »

whistlerbumps

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Re: TOO - Teekay Offshore Partners L.P.
« Reply #146 on: February 13, 2019, 02:29:23 PM »
They have an equity interest in the Libra FPSO.  Because they only own 50% and do not have control of Libra, its earnings do are not consolidated in EBIT but instead as equity income.   However, the company adjusts EBITDA to add back the earnings of their 50% interest in Libra because they consider it a core an operating asset (+92.6mln in FY18).  However, not all of Libra's 92.6mln of income was paid out as a dividend TOO thus Libra CFO<Libra equity income in EBITDA.  That difference is the -33.3 in the bridge from EBITDA to CFO.  Hope that helps.
« Last Edit: February 13, 2019, 02:31:01 PM by whistlerbumps »

heth247

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Re: TOO - Teekay Offshore Partners L.P.
« Reply #147 on: February 13, 2019, 02:52:38 PM »
They have an equity interest in the Libra FPSO.  Because they only own 50% and do not have control of Libra, its earnings do are not consolidated in EBIT but instead as equity income.   However, the company adjusts EBITDA to add back the earnings of their 50% interest in Libra because they consider it a core an operating asset (+92.6mln in FY18).  However, not all of Libra's 92.6mln of income was paid out as a dividend TOO thus Libra CFO<Libra equity income in EBITDA.  That difference is the -33.3 in the bridge from EBITDA to CFO.  Hope that helps.

Thanks. I've always thought that  the 33.3M is not the bridge from a top line (ebitda) to a bottom line, but the bottom line itself, which stands for the net income they received from JVs like Libra. And in CFO, they have subtracted this 33.3M as "Equity income, net of dividend". So I assumed that they do not consider those as operating assets when calculating the CFO.  Looks like I am wrong.
« Last Edit: February 13, 2019, 03:55:33 PM by heth247 »

heth247

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Re: TOO - Teekay Offshore Partners L.P.
« Reply #148 on: February 13, 2019, 05:40:24 PM »
whistlerbumps, in their earning release, appendix D, they give the details on the 50% JV, and we can see how they bridge from the 39M net income to 92M adjusted ebitda.  There is a 18.6M interest expense + 3.5M realized swap loss in between. Was that already included in your number?  If not, then subtracting them will reduce the delta from 66.8 to 44.7, correct?
« Last Edit: February 13, 2019, 05:46:02 PM by heth247 »

whistlerbumps

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Re: TOO - Teekay Offshore Partners L.P.
« Reply #149 on: February 14, 2019, 06:29:09 AM »
Good catch... I think you could be right about that given that the CFO number adjusts off equity income and not proportional EBITDA.... so now we just have to figure out the 44.7mln.