ex1.htm

EX-1 2 ex1.htm EXHIBIT 1 ex1.htm

EXHIBIT I

TEEKAY CORPORATION

Bayside House, Bayside Executive Park, West Bay Street & Blake Road

P.O. Box AP-59212, Nassau, Bahamas

EARNINGS RELEASE

TEEKAY CORPORATION REPORTS

THIRD QUARTER RESULTS

Highlights

§	Reported third quarter net income of $17.0 million, or $0.23 per share (including specific items which decreased net income by $5.9 million, or $0.08 per share) ⁽¹⁾

§	Generated cash flow from vessel operations of $135.5 million, 83 percent from fixed-rate businesses

§	Repurchased 978,400 shares at a total cost of $53.6 million since last reported on August 1, 2007

§	Increased dividend by 16 percent to $1.05 per share (annualized), the fifth consecutive annual increase

Nassau, The Bahamas, October 31, 2007 - Teekay Corporation (Teekay or the Company) (NYSE: TK) today reported net income of $17.0 million, or $0.23 per share, for the quarter ended September 30, 2007, compared to net income of $79.8 million, or $1.07 per share, for the quarter ended September 30, 2006. The results for the quarters ended September 30, 2007 and 2006 included a number of specific items that had the net effect of decreasing net income by $5.9 million, or $0.08 per share, and increasing net income by $2.0 million, or $0.03 per share, respectively, as detailed in Appendix A to this release. Net revenues⁽²⁾ for the third quarter of 2007 increased to $462.3 million from $344.3 million for the same period in 2006, and income from vessel operations decreased to $80.6 million from $105.0 million.

Net income for the nine months ended September 30, 2007 was $171.8 million, or $2.29 per share, compared to $201.9 million, or $2.68 per share, for the same period last year. The results for the nine months ended September 30, 2007 and 2006 included a number of specific items that had the net effect of decreasing net income by $2.5 million, or $0.03 per share, and by $44.8 million, or $0.59 per share, respectively, as detailed in Appendix A to this release. Net revenues⁽²⁾ for the nine months ended September 30, 2007 increased to $1.4 billion from $1.0 billion for the same period in 2006, and income from vessel operations increased to $323.7 million from $316.7 million.

Share Repurchase Program

Since August 1, 2007, the previous date the Company reported the status of its share repurchase program, the Company has repurchased 978,400 shares of its common stock at an average price of $54.80 per share, resulting in $44.3 million remaining under the existing share repurchase authorization.

As at September 30, 2007, the Company had 73.3 million common shares issued and outstanding.

OMI Acquisition Update

On August 1, 2007, most of the assets from the joint acquisition of OMI Corporation (OMI) were divided equally between Teekay and A/S Dampskibsselskabet (Torm). Through this acquisition, Teekay acquired seven Suezmax tankers, four Medium Range product tankers and four Handysize product tankers. Teekay also assumed OMI’s in-charters of a further six Suezmax tankers and OMI’s third party asset management business, the Gemini pool. Teekay and Torm will continue to hold two Medium Range product tankers jointly in OMI, as well as two Handysize product tanker newbuildings scheduled to deliver in 2009. The parties intend to divide these remaining assets equally in due course.

Teekay has consolidated the results of the vessels it acquired from OMI effective August 1, 2007. For the period of July 1 to July 31, 2007, OMI’s results were accounted for using the equity method of accounting.

(1)	Please read Appendix A to this release for information about specific items affecting net income.

(2)

Net revenues represents revenues less voyage expenses. Net revenues is a non-GAAP financial measure used by certain investors to measure the financial performance of shipping companies. Please see the Company’s web site at www.teekay.com for a reconciliation of this non-GAAP measure as used in this release to the most directly comparable GAAP financial measure.

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Operating Results

During the third quarter of 2007, fixed-rate businesses generated approximately 83 percent of the Company’s cash flow from vessel operations compared to 59 percent in the third quarter of 2006.

The following table highlights certain financial information for Teekay’s four main segments; the offshore segment, the fixed-rate tanker segment, the liquefied gas segment, and the spot tanker segment (please read the “Teekay Fleet” section of this release below and Appendix B for further details):

	Three Months Ended September 30, 2007
	(unaudited)

(in thousands of U.S. dollars)	Offshore Segment		Fixed-Rate Tanker Segment		Liquefied Gas Segment		Spot Tanker Segment		Total

Net revenues		219,613		50,457		42,921		149,291		462,282

Vessel operating expenses		76,625		13,285		8,056		22,042		120,008
Time-charter hire expense		40,615		7,773		-		73,368		121,756
Depreciation & amortization		45,359		9,236		11,491		20,972		87,058

Cash flow from vessel operations*		58,334		24,376		29,188		23,639		135,537

	Three Months Ended September, 2006
	(unaudited)

(in thousands of U.S. dollars)	Offshore Segment		Fixed-Rate Tanker Segment		Liquefied Gas Segment		Spot Tanker Segment		Total

Net revenues		118,026		46,062		26,073		154,142		344,303

Vessel operating expenses		22,405		10,945		4,706		14,883		52,939
Time-charter hire expense		41,426		4,243		-		55,179		100,848
Depreciation & amortization		20,297		8,294		8,235		13,023		49,849

Cash flow from vessel operations*		42,891		26,977		17,631		60,247		147,746

*Cash flow from vessel operations represents income from vessel operations before depreciation and amortization expense and vessel write-downs/(gain) loss on sale of vessels. Cash flow from vessel operations is a non-GAAP financial measure used by certain investors to measure the financial performance of shipping companies. Please see the Company’s web site at www.teekay.com for a reconciliation of this non-GAAP measure as used in this release to the most directly comparable GAAP financial measure.

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Offshore Segment

The offshore segment is comprised of the Company’s fleet of shuttle tankers, floating storage and off-take (FSO) units, and floating production storage and offtake (FPSO) units.

Cash flow from vessel operations from the Company’s offshore segment increased to $58.3 million in the third quarter of 2007, compared to $42.9 million in the third quarter of 2006, primarily due to the acquisition of Teekay Petrojarl ASA in the fourth quarter of 2006, the transfer of an FSO unit, the Navion Saga, to the Offshore Segment in May 2007 upon its commencement of a three-year time-charter, the consolidation of five 50 percent-owned shuttle tankers effective December 1, 2006, and the delivery of two shuttle tankers upon their commencement of 13-year charters.

In July and October 2007, respectively, Teekay sold to its 59.8 percent-owned subsidiary, Teekay Offshore Partners L.P. (Teekay Offshore), its interests in two shuttle tankers and one FSO unit, all of which operate under long-term fixed-rate charters.

Fixed-Rate Tanker Segment

The fixed-rate tanker segment includes Teekay LNG Partners L.P.’s (Teekay LNG) Suezmax fleet and Teekay’s directly operated fixed-rate conventional tankers.

Effective August 1, 2007, two former OMI Suezmax tankers, which are on time-charters that expire in 2012, were added to the Company’s fixed-rate tanker segment. In addition, one of the Company’s in-chartered Aframax tankers was transferred to the fixed-rate tanker segment from the spot tanker segment in the third quarter of 2007, upon the commencement of a three-year fixed-rate time-charter.

Cash flow from vessel operations from the Company’s fixed-rate tanker segment decreased to $24.4 million in the third quarter of 2007, compared to $27.0 million in the third quarter of 2006. This decrease was primarily due to lower revenues earned on two vessels, which earn a profit share component when spot tanker rates exceed certain threshold levels, and higher vessel crewing costs, partially offset by the vessels added to this segment as noted above.

Liquefied Gas Segment

The liquefied gas segment includes Teekay LNG’s fleet of liquefied natural gas (LNG) and liquefied petroleum gas (LPG) carriers.

The Company’s cash flow from vessel operations from its existing LNG and LPG carriers during the third quarter of 2007 was $29.2 million compared to $17.6 million in the third quarter of 2006. This increase was primarily due to the delivery of the three RasGas II LNG carriers which commenced 20-year fixed-rate charters in November 2006, January 2007, and February 2007, respectively. This increase was partially offset by the scheduled drydock of one of the LNG carriers during the third quarter of 2007.

The Company has ownership interests ranging from 40 percent to 70 percent in six additional LNG newbuildings scheduled to deliver at various dates between the second quarter of 2008 and early 2009, all of which will commence service upon delivery under 20 or 25-year fixed-rate contracts with major energy companies.

Teekay has agreed to sell the following vessels to its 63.7 percent owned subsidiary, Teekay LNG:

·	*RasGas 3* - a 40 percent interest in four LNG newbuilding carriers scheduled to deliver during the second quarter of 2008.

·	*Tangguh* - a 70 percent interest in two LNG newbuilding carriers scheduled to deliver during late 2008 and early 2009.

Teekay LNG has also agreed to acquire three LPG carriers currently under construction from IM Skaugen ASA (Skaugen) upon their delivery from the shipyard between mid-2008 and mid-2009. Upon delivery, these vessels will commence 15-year fixed-rate charters to Skaugen.

As previously announced, a consortium in which Teekay has a 33 percent interest, signed a letter of intent to charter four newbuilding LNG carriers for a period of 20 years to the Angola LNG Project, which is being developed by subsidiaries of Chevron, Sonangol, BP, and Total. The vessels will be chartered at fixed-rates, with inflation adjustments, commencing in 2011. Final award of this charter is expected in December 2007. Teekay is obligated to offer Teekay LNG its 33 percent interest in these vessels and related charter contracts.

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Spot Tanker Segment

The Company’s spot tanker segment includes its conventional tankers, which are operating on voyage and period out-charters with an initial term of less than three years.

Cash flow from vessel operations from the Company’s spot tanker segment decreased to $23.6 million for the third quarter of 2007, from $60.2 million for the third quarter of 2006, primarily due to a decrease in spot tanker charter rates, an increase in time-charter hire expense and higher average in-charter rates, and an increase in vessel crewing costs, partially offset by an increase in the size of the Company’s spot tanker fleet from the OMI acquisition.

On a net basis, fleet changes increased the total number of revenue days in the Company’s spot tanker segment to 6,418 for the third quarter of 2007, compared to 5,254 for the third quarter of 2006. Revenue days represent the total number of vessel calendar days less off-hire associated with major repairs, drydockings, or mandated surveys.

Tanker freight rates declined during the third quarter of 2007, primarily due to seasonal oil field maintenance in the North Sea and Former Soviet Union, as well as hurricane-related outages in Mexico, which led to lower oil export volumes. Preliminary data from the International Energy Agency (IEA) indicated that the oil inventories in the Organization for Economic Co-Operation and Development (OECD) countries experienced a 33 million barrel counter-seasonal decline during the third quarter of 2007 as oil price futures shifted into sustained backwardation for the first time in almost three years. Backwardation occurs when the current oil price is higher than the forward oil price, which encourages inventory draw-downs due to the expectation of cheaper oil prices in the future.

As of October 11, 2007, the IEA was forecasting global oil demand growth during the upcoming winter season (the fourth quarter of 2007 and first quarter of 2008) to be 2.5 mb/d (or 2.9 percent) higher than the third quarter of 2007. For 2008, the IEA’s estimate for global oil demand growth is 2.1 mb/d (or 2.4 percent) which would be the highest since the near record high experienced in 2004.

In the latter part of October 2007, tanker freight rates increased significantly from the seasonal lows experienced during the third quarter.

Tanker sales for drybulk carrier conversion have risen, driven by high earnings in the drybulk sector. In addition, several existing tanker newbuilding orders have been switched into drybulk newbuildings, dampening expected tanker supply growth.

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The following table highlights the operating performance of the Company’s spot tanker segment measured in net revenues per revenue day, or time-charter equivalent (TCE), and includes the effect of forward freight agreements (FFAs) which are entered into as hedges against a portion of the Company’s exposure to spot market rates:

	Three Months Ended						Nine Months Ended
	September 30, 2007		June 30, 2007		September 30, 2006		September 30, 2007		September 30, 2006
Spot Tanker Segment
Suezmax Tanker Fleet
Revenue days		1,039		337		460		1,800		1,240
TCE per revenue day *	$	27,097	$	30,134	$	31,776	$	30,606	$	36,324

Aframax Tanker Fleet
Revenue days		2,960		2,820		2,937		8,458		8,789
TCE per revenue day *	$	21,508	$	31,992	$	34,788	$	29,911	$	36,097

Large/Medium-Size Product Tanker Fleet
Revenue days		1,521		1,149		867		3,790		2,530
TCE per revenue day *	$	27,258	$	30,010	$	26,476	$	27,366	$	28,959

Small Product Tanker Fleet
Revenue days		898		901		990		2,695		2,794
TCE per revenue day	$	13,893	$	15,392	$	14,543	$	15,022	$	15,943

*TCE results for the Suezmax and Aframax tanker fleets include realized results of synthetic time charters, FFAs, short-term time-charters and fixed-rate contracts of affreightment. Excluding these amounts, Suezmax TCEs on a revenue-day basis for the quarters ended September 30, 2007, June 30, 2007, and September 30, 2006 would have been $22,350, $49,876 and $46,210 per day, respectively. Excluding these amounts, Aframax TCEs on a revenue-day basis for the quarters ended September 30, 2007, June 30, 2007, and September 30, 2006 would have been $20,070, $31,440 and $35,422 per day, respectively. TCE results for the Large/Medium-Size Product Tanker Fleet include 3 Handysize and 6 Medium Range product tankers on short-term time charters. Excluding these amounts, TCE on a revenue-day basis for the quarter ended September 30, 2007 would have been $29,676 per day.

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Teekay Fleet

As at September 30, 2007, Teekay’s fleet consisted of 187 vessels, including chartered-in vessels, newbuildings on-order, and vessels being converted to offshore units, but excluding vessels managed for third parties.

The following table summarizes the Teekay fleet as at September 30, 2007:

	Number of Vessels ⁽¹⁾
	Owned Vessels		Chartered-in Vessels		Newbuildings /Conversions		Total
Offshore Segment
Shuttle Tankers⁽²⁾		27		13		4		44
Floating Storage & Offtake ("FSO") Units ⁽³⁾		5		-		-		5
Floating Production Storage & Offtake ("FPSO") Units ⁽⁴⁾		4		-		1		5
Total Offshore Segment		36		13		5		54

Fixed-Rate Tanker Segment
Conventional Tankers⁽⁵⁾		16		4		2		22
Total Fixed-Rate Tanker Segment		16		4		2		22

Liquefied Gas Segment
LNG Carriers⁽⁶⁾		7		-		6		13
LPG Carriers		1		-		3		4
Total Liquefied Gas Segment		8		-		9		17

Spot Tanker Segment
Suezmaxes		6		9		10		25
Aframaxes⁽⁷⁾		20		17		-		37
Large/Medium Product Tankers		14		7		1		22
Small Product Tankers		-		10		-		10
Total Spot Tanker Segment		40		43		11		94
Total		100		60		27		187

(1)	Excludes vessels managed on behalf of third parties.

(2)	Includes six shuttle tankers in which the Company’s ownership interest is 50 percent.

(3)	Includes one unit in which the Company’s ownership interest is 89percent.

(4)	Includes four FPSOs owned by Teekay Petrojarl, and one vessel being converted to an FPSO jointly owned by Teekay and Teekay Petrojarl.

(5)	Includes eight Suezmax tankers owned by Teekay LNG.

(6)	The seven existing LNG vessels are owned by Teekay LNG. Teekay LNG has agreed to acquire Teekay’s 70 percent interest in two of the LNG newbuildings and Teekay’s 40 percent interest in four LNG newbuildings upon delivery of the vessels. Excludes Angola LNG Project vessels.

(7)	Includes nine Aframax tankers owned by Teekay Offshore and chartered to Teekay

Capital Expenditures and Liquidity

As of September 30, 2007, the Company’s remaining capital commitments relating to its portion of newbuildings and conversions, were as follows:

(in millions)	2007		2008		2009		2010		2011		Total
Offshore Segment	$	21		-	$	23	$	231	$	163	$	438
Fixed-Rate Tanker Segment		8		59		-		-		-		67
Liquefied Gas Segment		-		216		54		-		-		270
Spot Tanker Segment		18		365		132		-		-		515
Total	$	47	$	640	$	209	$	231	$	163	$	1,290

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Pre-arranged debt facilities are in place for the majority of the Company’s capital commitments. Additionally, as of September 30, 2007, the Company had total liquidity of $1.9 billion (excluding debt related to capital commitments), comprised of $297 million in cash and cash equivalents and $1.6 billion in undrawn credit facilities.

Teekay Tankers

As previously announced, the Company expects to file publicly with the U.S. Securities and Exchange Commission a registration statement for the initial public offering of a new publicly-traded entity, Teekay Tankers, which will focus on the conventional tanker business during the fourth quarter of 2007.

About Teekay

Teekay Corporation transports more than 10 percent of the world’s seaborne oil, has built a significant presence in the liquefied natural gas shipping sector through its publicly-listed subsidiary, Teekay LNG Partners L.P. (NYSE: TGP), and is further growing its operations in the offshore production, storage and transportation sector through its publicly-listed subsidiaries, Teekay Offshore Partners L.P. (NYSE: TOO) and Teekay Petrojarl ASA (OSE: TPO). With a fleet of over 185 vessels, offices in 17 countries and 6,300 seagoing and shore-based employees, Teekay provides a comprehensive set of marine services to the world’s leading oil and gas companies, helping them seamlessly link their upstream energy production to their downstream processing operations. Teekay’s reputation for safety, quality and innovation has earned it a position with its customers as The Marine Midstream Company.

Teekay’s common stock is listed on the New York Stock Exchange where it trades under the symbol “TK”.

Earnings Conference Call

The Company plans to host a conference call on Thursday, November 1, 2007 at 11:00 a.m. (ET) to discuss the results for the quarter. All shareholders and interested parties are invited to listen to the live conference call and view the Company’s earnings presentation through the Company’s web site at www.teekay.com.The Company plans to make available a recording of the conference call until midnight Thursday, November 8, 2007, by dialing (888) 203-1112 or (647) 436-0148, access code 9949396, or via the Company’s web site until December 3, 2007.

For Investor Relations enquiries contact:

Dave Drummond

Tel: +1 (604) 844-6654

For Media enquiries contact:

Alana Duffy

Tel: +1 (604) 844-6605

Web site: www.teekay.com

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TEEKAY CORPORATION SUMMARY CONSOLIDATED STATEMENTS OF INCOME (in thousands of U.S. dollars, except share and per share data)


	Three Months Ended									Nine Months Ended
	September 30,			June 30,			September 30,			September 30,			September 30,
	2007			2007			2006			2007			2006
	(unaudited)			(unaudited)			(unaudited)			(unaudited)			(unaudited)

REVENUES		606,836			577,882			477,733			1,767,734			1,426,316

OPERATING EXPENSES
Voyage expenses		144,554			135,309			133,430			403,423			378,458
Vessel operating expenses		120,008			108,851			52,939			326,300			157,866
Time-charter hire expense		121,756			101,247			100,848			321,504			299,975
Depreciation and amortization		87,058			68,095			49,849			234,416			150,490
General and administrative		60,912			58,358			39,822			178,067			121,538
Writedown / (gain) on sale of vessels and equipment		(8,072	)		(11,613	)		(7,138	)		(19,685	)		(6,095	)
Restructuring charge		-			-			2,948			-			7,414
		526,216			460,247			372,698			1,444,025			1,109,646
Income from vessel operations		80,620			117,635			105,035			323,709			316,670
OTHER ITEMS
Interest expense		(81,008	)		(64,158	)		(40,572	)		(205,549	)		(114,059	)
Interest income		23,071			23,390			14,262			62,629			39,948
Income tax (expense) recovery		(9,995	)		(287	)		4,985			(6,200	)		(5,839	)
Equity (loss) income from joint ventures		(1,654	)		(2,092	)		1,965			(5,341	)		2,259
Foreign exchange gain (loss)		(10,025	)		1,214			277			(14,699	)		(32,991	)
Minority interest (expense) income		3,602			(6,341	)		(7,289	)		(8,379	)		(4,682	)
Other – net		12,378			9,050			1,184			25,605			638
		(63,631	)		(39,224	)		(25,188	)		(151,934	)		(114,726	)
Net income		16,989			78,411			79,847			171,775			201,944
Earnings per common share - Basic - Diluted	$ $	0.23 0.23		$ $	1.06 1.04		$ $	1.09 1.07		$ $	2.34 2.29		$ $	2.76 2.68
Weighted-average number of common shares outstanding - Basic - Diluted		73,592,554 74,917,614			73,843,784 75,310,567			73,251,038 74,944,038			73,523,627 74,925,820			73,223,613 75,318,853

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TEEKAY CORPORATION SUMMARY CONSOLIDATED BALANCE SHEETS (in thousands of U.S. dollars)
	As at September 30,		As at December 31,
	2007		2006
	(unaudited)		(unaudited)
ASSETS
Cash and cash equivalents		296,637		343,914
Other current assets		415,061		318,229
Restricted cash – current		40,527		64,243
Restricted cash – long-term		675,960		615,749
Vessels held for sale		-		20,754
Vessels and equipment		6,085,605		4,925,409
Advances on newbuilding contracts		552,488		382,659
Other assets		859,138		515,242
Intangible assets		269,816		280,559
Goodwill		430,471		266,718
Total Assets		9,625,703		7,733,476
LIABILITIES AND STOCKHOLDERS’ EQUITY
Accounts payable and accrued liabilities		315,289		311,088
Current portion of long-term debt		234,235		369,043
Long-term debt		5,193,724		3,350,640
Other long-term liabilities / In process revenue contracts		686,866		720,080
Minority interest		513,571		454,403
Stockholders’ equity		2,682,018		2,528,222
Total Liabilities and Stockholders’ Equity		9,625,703		7,733,476

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TEEKAY CORPORATION SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands of U.S. dollars)
	Nine Months Ended September 30,
	2007			2006
	(unaudited)			(unaudited)
Cash and cash equivalents provided by (used for)
OPERATING ACTIVITIES
Net operating cash flow		230,522			398,841

FINANCING ACTIVITIES
Net proceeds from long-term debt		2,410,991			977,688
Scheduled repayments of long-term debt		(232,105	)		(21,691	)
Prepayments of long-term debt		(851,178	)		(259,375	)
Increase in restricted cash		(13,333	)		(433,184	)
Repurchase of common stock		(50,257	)		(212,330	)
Net proceeds from the public offering of Teekay LNG		84,182			-
Other		(21,079	)		(48,212	)
Net financing cash flow		1,327,221			2,896

INVESTING ACTIVITIES
Expenditures for vessels and equipment		(550,531	)		(285,834	)
Proceeds from sale of vessels and equipment		199,475			321,876
Purchase of marketable securities		(39,265	)		(549	)
Proceeds from sale of marketable securities		53,941			-
Purchase of OMI Corporation (net of cash acquired $427)		(1,108,136	)		-
Loan to joint ventures		(187,618	)		(20,217	)
Investment in Petrojarl ASA		(1,210	)		(347,173	)
Other		28,324			(3,593	)
Net investing cash flow		(1,605,020	)		(335,490	)

(Decrease) increase in cash and cash equivalents		(47,277	)		66,247
Cash and cash equivalents, beginning of the period		343,914			236,984
Cash and cash equivalents, end of the period		296,637			303,231

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TEEKAY CORPORATION
APPENDIX A – SPECIFIC ITEMS AFFECTING NET INCOME
(in thousands of U.S. dollars, except per share data)
Set forth below are some of the significant items of income and expense that affected the Company’s net income for the three and nine months ended September 30, 2007 and 2006, all of which items are typically excluded by securities analysts in their published estimates of the Company’s financial results:
	Three Months Ended			Nine Months Ended
	September 30, 2007			September 30, 2007
	(unaudited)			(unaudited)
	$		$ Per	$		$ Per
	$		Share	$		Share
Gain on sale of vessels and equipment	8,072		0.11	19,685		0.26
Gain on sale of marketable securities	-		-	4,836		0.07
Gain on sale of Seagull AS	6,997		0.09	6,997		0.09
Foreign currency exchange losses ⁽¹⁾	(10,025	)	(0.13)	(14,699	)	(0.19)
Minority owners’ share of foreign currency exchange losses	6,958		0.09	9,711		0.13
Deferred income tax expense on unrealized foreign exchange gains ⁽²⁾	(12,031	)	(0.16)	(19,744	)	(0.26)
Minority owners’ share of deferred income tax expense on unrealized foreign exchange gains	1,259		0.02	2,067		0.03
Unrealized loss from interest rate swaps	(6,298	)	(0.09)	(6,298	)	(0.09)
Net effect from non-cash changes in purchase price allocation for acquisition of Teekay Petrojarl ASA ⁽³⁾	-		-	(4,240	)	(0.06)
Loss on bond repurchases (8.875 percent Notes due 2011)	(842	)	(0.01)	(842	)	(0.01)
Total	(5,910	)	(0.08)	(2,527	)	(0.03)

	Three Months Ended			Nine Months Ended
	September 30, 2006			September 30, 2006
	(unaudited)			(unaudited)
	$		$ Per	$		$ Per
	$		Share	$		Share
Gain on sale of vessels and equipment	3,968		0.05	5,075		0.07
Foreign currency exchange gains (losses) ⁽¹⁾	277		-	(32,991	)	(0.44)
Minority owners’ share of foreign currency exchange (gains) losses	(1,212	)	(0.01)	7,862		0.11
Deferred income tax recovery (expense) on unrealized foreign exchange losses (gains) ⁽²⁾	5,156		0.07	(5,427	)	(0.07)
Restructuring charge	(2,948	)	(0.04)	(7,414	)	(0.10)
Interest expense related to the purchase of shares of Petrojarl ASA	(1,565	)	(0.02)	(1,565	)	(0.02)
Unrealized loss from interest rate swaps	(1,680	)	(0.02)	(1,680	)	(0.02)
Write down of vessels and equipment	-		-	(2,150	)	(0.03)
Loss on bond repurchases (8.875 percent Notes due 2011)	-		-	(375	)	(0.01)
Loss on expiry of options to construct LNG carriers	-		-	(6,102	)	(0.08)
Total	1,996		0.03	(44,767	)	(0.59)

(1)	Foreign currency exchange gains and losses primarily relate to the Company’s debt denominated in Euros and deferred tax liability denominated in Norwegian Kroner. Nearly all of the Company’s foreign currency exchange gains and losses are unrealized.

(2)	Portion of deferred income tax related to unrealized foreign exchange gains.

(3)	Primarily from changes in amortization of vessels, intangible assets and in-process revenue contracts relating to the period from October 1, 2006, to June 30, 2007, as a result of adjustments to the purchase price allocation for acquisition of Teekay Petrojarl ASA.

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TEEKAY CORPORATION

APPENDIX B - SUPPLEMENTAL SEGMENT INFORMATION

(in thousands of U.S. dollars)

	Three Months Ended September 30, 2007
	(unaudited)

	Offshore Segment			Fixed-Rate Tanker Segment		Liquefied Gas Segment		Spot Tanker Segment		Total

Net revenues ⁽¹⁾		219,613			50,457		42,921		149,291		462,282
Vessel operating expenses		76,625			13,285		8,056		22,042		120,008
Time-charter hire expense		40,615			7,773		-		73,368		121,756
Depreciation and amortization		45,359			9,236		11,491		20,972		87,058
General and administrative		25,956			4,889		5,677		24,390		60,912
Gain on sale of vessels and equipment		(8,072	)		-		-		-		(8,072	)
Income from vessel operations		39,130			15,274		17,697		8,519		80,620

	Three Months Ended June 30, 2007
	(unaudited)

	Offshore Segment			Fixed-Rate Tanker Segment		Liquefied Gas Segment		Spot Tanker Segment		Total

Net revenues ⁽¹⁾		210,169			45,195		38,488		148,721		442,573
Vessel operating expenses		74,427			11,822		7,881		14,721		108,851
Time-charter hire expense		39,549			3,981		-		57,717		101,247
Depreciation and amortization		35,627			8,260		11,571		12,637		68,095
General and administrative		24,627			4,522		5,489		23,720		58,358
Gain on sale of vessels and equipment		(11,613	)		-		-		-		(11,613	)
Income from vessel operations		47,552			16,610		13,547		39,926		117,635

	Three Months Ended September 30, 2006
	(unaudited)

	Offshore Segment			Fixed-Rate Tanker Segment		Liquefied Gas Segment		Spot Tanker Segment			Total

Net revenues ⁽¹⁾		118,026			46,062		26,073		154,142			344,303
Vessel operating expenses		22,405			10,945		4,706		14,883			52,939
Time-charter hire expense		41,426			4,243		-		55,179			100,848
Depreciation and amortization		20,297			8,294		8,235		13,023			49,849
General and administrative		11,304			3,897		3,736		20,885			39,822
Gain on sale of vessels and equipment		(6,509	)		-		-		(629	)		(7,138	)
Restructuring charge		-			-		-		2,948			2,948
Income from vessel operations		29,103			18,683		9,396		47,853			105,035

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TEEKAY CORPORATION

APPENDIX B - SUPPLEMENTAL SEGMENT INFORMATION

(in thousands of U.S. dollars)

	Nine Months Ended September 30, 2007
	(unaudited)

	Offshore Segment			Fixed-Rate Tanker Segment		Liquefied Gas Segment		Spot Tanker Segment		Total

Net revenues ⁽¹⁾		649,931			139,681		118,881		455,818		1,364,311
Vessel operating expenses		213,766			36,797		22,395		53,342		326,300
Time-charter hire expense		121,481			15,591		-		184,432		321,504
Depreciation and amortization		126,708			25,964		33,856		47,888		234,416
General and administrative		76,089			13,887		16,365		71,726		178,067
Gain on sale of vessels and equipment		(19,685	)		-		-		-		(19,685	)
Income from vessel operations		131,572			47,442		46,265		98,430		323,709

	Nine Months Ended September 30, 2006
	(unaudited)

	Offshore Segment			Fixed-Rate Tanker Segment		Liquefied Gas Segment		Spot Tanker Segment			Total

Net revenues⁽¹⁾		359,925			133,419		74,403		480,111			1,047,858
Vessel operating expenses		67,847			32,300		14,325		43,394			157,866
Time-charter hire expense		127,492			12,560		-		159,923			299,975
Depreciation and amortization		62,337			24,605		24,222		39,326			150,490
General and administrative		33,051			12,030		11,028		65,429			121,538
Writedown / (gain) on sale of vessels and equipment		(4,664	)		-		-		(1,431	)		(6,095	)
Restructuring charge		-			-		-		7,414			7,414
Income from vessel operations		73,862			51,924		24,828		166,056			316,670

(1)

Net revenues represents revenues less voyage expenses, which comprise all expenses relating to certain voyages, including bunker fuel expenses, port fees, canal tolls and brokerage commissions. Net revenues is a non-GAAP financial measure used by certain investors to measure the financial performance of shipping companies. Please see the Company’s Web site at www.teekay.com for a reconciliation of this non-GAAP measure as used in this release to the most directly comparable GAAP financial measure.

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FORWARD LOOKING STATEMENTS

This release contains forward-looking statements (as defined in Section 21E of the Securities Exchange Act of 1934, as amended) which reflect management’s current views with respect to certain future events and performance, including statements regarding: the Company’s future growth prospects; tanker market fundamentals, including the balance of supply and demand in the tanker market, and spot tanker charter rates; expected demand in the offshore oil production sector and the demand for vessels; the Company’s future capital expenditure commitments and the financing requirements for such commitments; the timing of newbuilding deliveries; the commencement of charter contracts; the Company being awarded LNG vessels and associated long-term contracts to service the Angola LNG Project; the level of future OPEC oil production; and the proposed initial public offering of Teekay Tankers, and the timing of filing a registration statement relating to the offering. The following factors are among those that could cause actual results to differ materially from the forward-looking statements, which involve risks and uncertainties, and that should be considered in evaluating any such statement: changes in production of or demand for oil, petroleum products and LNG, either generally or in particular regions; greater or less than anticipated levels of tanker newbuilding orders or greater or less than anticipated rates of tanker scrapping; changes in trading patterns significantly affecting overall vessel tonnage requirements; changes in applicable industry laws and regulations and the timing of implementation of new laws and regulations; changes in the typical seasonal variations in tanker charter rates; changes in the offshore production of oil or demand for shuttle tankers, FSOs and FPSOs; the potential for early termination of long-term contracts and inability of the Company to renew or replace long-term contracts; the potential that the conditions for the Angola LNG Project are not met; changes affecting the offshore tanker market; shipyard production delays; the Company’s future capital expenditure requirements; the Company’s, Teekay LNG’s and Teekay Offshore’s potential inability to raise financing to purchase additional vessels; conditions in the United States capital markets, changes affecting the conventional tanker market, and other factors discussed in Teekay’s filings from time to time with the SEC, including its Report on Form 20-F for the fiscal year ended December 31, 2006. The Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in the Company’s expectations with respect thereto or any change in events, conditions or circumstances on which any such statement is based.

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