Teekay GP LLC, the general partner of Teekay LNG Partners LP, suffered a drop in income for the second quarter of this year.
Teekay LNG reported a GAAP net income of $53.3 mill and GAAP net income per common unit of $0.53 for 2Q21, compared with $87.6 mill for 1Q21 and $44.9 mill for 2Q20.
Adjusted net income was $57 mill and adjusted net income per common unit was $0.57. In addition, total adjusted EBITDA was $183.5 mill, compared with $184.3 mill for 1Q21 and $192.3 mill in 2Q20.
The Partnership also reported that its LNG fleet was 98% fixed for the remainder of 2021, and 89% fixed for 2022.
Teekay explained that the net income reduction was primarily due to an increase in scheduled drydockings during 2Q21, and the timing of planned repairs and maintenance activities. Income was also negatively impacted by changes in unrealised gains and losses on non-designated derivative instruments, compared to 1Q21.
“Teekay LNG reported another quarter of strong results today, with second quarter of 2021 adjusted net income of $0.57 per common unit and over $183.5 mill of total adjusted EBITDA,” said Mark Kremin, Teekay Gas Group Ltd’s President and CEO.“As expected, our results in the second quarter reflect a heavier than normal drydock schedule.
“Looking ahead, our third quarter 2021 results are also expected to be impacted by a heavy drydock schedule; however, for the fourth quarter of 2021, we are expecting a bounce back as a result of a substantially reduced number of drydock days across the fleet.
“The spot and term charter market for LNG carriers has been counter-seasonally strong over the past six months, and LNG supply and demand fundamentals are pointing to continued strength through the rest of 2021 and into 2022. This should benefit the ‘Creole Spirit’, which is on a market-linked contract until mid-February 2022.
“We believe this market strength could also be a tailwind for Teekay LNG next year, as we have a few LNG carriers expected to roll-off of their current contracts during the first half of next year. We do, however, continue to have nearly all of our 2021 and the vast majority of our 2022 revenue days already secured on fixed-rate charters and generating consistent cash flow,” he concluded.
