We have reviewed the quarterly financials of TeeKay Offshore and we need to note a large chunk of revenue (and thus earnings) came from a settlement with Brazil oil company Petrobras. This amounts to about $96 million. This is a significant chunk of their improvement, but the balance of the quarter remains relatively strong–although there is much improvement yet to do and I believe Brookfield will bring some disciplined management to the company.
TeeKay Offshore Partners (NYSE:TOO) has reported earnings and they appear to be quite stellar.
We have not had the opportunity to review the release closely, but kind of the headlines numbers.
We had mentioned before that TeeKay Corp no longer controlled TOO and that Canadian asset manager Brookfield Business Partners had taken control of the company from TeeKay. If we recall Brookfield had plowed quite a chunk of change into the company and the balance sheet is being improved.
We are not advocating a purchase of the 3 preferred issues of the company (TOO-A, TOO-B and TOO-E), but they are all trading in the 11.5% current yield and there may be opportunity for investors with the ability to manage the risk of owning these issues.