ABERDEEN, Scotland--(BUSINESS WIRE)--
Highlights
For the three months ended June 30, 2017, KNOT Offshore Partners LP
(“KNOT Offshore Partners” or the “Partnership”):
-
Generated highest ever quarterly total revenues of $54.4 million,
operating income of $26.1 million and net income of $16.9 million.
-
Generated highest ever quarterly Adjusted EBITDA of $43.5 million.1
-
Generated highest ever quarterly distributable cash flow of $23.4
million.1
-
Reported highest ever distribution coverage ratio of 1.43.2
-
Achieved strong performance with 100% utilization of the fleet.3
Other events:
-
On May 26, 2017, the Partnership refinanced the credit facility
secured by the Hilda Knutsen.
-
On June 1, 2017, the Partnership completed the acquisition from
Knutsen NYK Offshore Tankers AS (“Knutsen NYK”) of the entity that
owns the Vigdis Knutsen.
-
On June 30, 2017, the Partnership issued and sold in a private
placement 1,666,667 additional Series A Preferred Units at a price of
$24.00 per unit. After deducting estimated fees and expenses, the net
proceeds of the sale were approximately $38.8 million.
-
On July 14, 2017, Shell exercised its option to extend the time
charter of the vessel Windsor Knutsen by one additional year
until October 2018.
-
On July 18, 2017, the Partnership declared a quarterly cash
distribution of $0.52 per common unit with respect to the quarter
ended June 30, 2017, to be paid on August 15, 2017 to all unitholders
of record as of the close of business on August 2, 2017. On July 18,
2017, the Partnership also declared a cash distribution payable to
Series A Preferred Unitholders with respect to the quarter ended June
30, 2017 in an aggregate amount equal to $1.0 million to be paid on
August 15, 2017.
-
On August 9, 2017, the Partnership entered into an agreement for a new
$25 million unsecured revolving credit facility.
-
On August 9, 2017, the Partnership’s wholly owned subsidiary, KNOT
Shuttle Tankers AS, entered into a share purchase agreement with
Knutsen NYK to acquire KNOT Shuttle Tankers 26 AS (“KNOT 26”), the
company that owns the shuttle tanker, Lena Knutsen, from
Knutsen NYK (the “Lena Acquisition”). The Partnership expects the Lena
Acquisition to close by September 30, 2017, subject to customary
closing conditions.
Financial Results Overview
Total revenues were $54.4 million for the three months ended June 30,
2017 (the “second quarter”) compared to $45.0 million for the three
months ended March 31, 2017 (the “first quarter”). The second quarter
revenues were positively affected by (i) earnings from the time charters
for the Tordis Knutsen and the Vigdis Knutsen being
included in the results of operations from March 1, 2017 and June 1,
2017, respectively, (ii) a full quarter of earnings from the Windsor
Knutsen, which incurred 54.1 days of off-hire during the first
quarter in connection with its scheduled drydocking and (iii) a full
quarter of earnings from the Raquel Knutsen, which incurred a
14-day deductible for offhire in the first quarter.
Vessel operating expenses for the second quarter of 2017 were $9.4
million, a decrease of $0.9 million from $10.3 million in the first
quarter of 2017. The decrease was mainly due to receipt of insurance
proceeds in the second quarter related to the technical default with the Raquel
Knutsen’s controllable pitch propeller in the first quarter and
bunkers consumption in connection with the drydocking of the Windsor
Knutsen that was charged in the first quarter. This was partially
offset by higher operating expenses due to the Tordis Knutsen and
the Vigdis Knutsen being included in the results of operations
from March 1, 2017 and June 1, 2017, respectively.
General and administrative expenses of $1.5 million in the second
quarter were unchanged from the first quarter.
As a result, operating income for the second quarter of 2017 was $26.1
million compared to $17.5 million in the first quarter of 2017.
Interest expense for the second quarter of 2017 was $7.3 million,
compared to $6.2 million for the first quarter of 2017. The increase was
mainly due to the additional debt incurred in connection with the
acquisitions of the Tordis Knutsen and the Vigdis
Knutsen.
Realized and unrealized loss on derivative instruments was $1.5 million
in the second quarter of 2017, compared to a gain of $0.5 million in the
first quarter of 2017. The unrealized non-cash element of the
mark-to-market loss was $0.5 million for the three months ended June 30,
2017 compared to a gain of $1.3 million for the three months ended March
31, 2017. Of the unrealized loss for the second quarter of 2017, $1.3
million related to mark-to-market losses on interest rate swaps due to a
decrease in swap rate during the quarter, and an unrealized gain of $0.8
million related to foreign exchange contracts due to the strength of the
Norwegian Kroner (NOK) against the U.S. Dollar. Of the unrealized gain
for the first quarter of 2017, $1.1 million related to mark-to-market
gains on interest rate swaps due to an increase in swap rate during the
quarter, and an unrealized gain of $0.2 million related to foreign
exchange contracts due to a slightly stronger U.S. Dollar against the
NOK.
As a result, net income for the second quarter of 2017 was $16.9 million
compared to $11.4 million for the first quarter of 2017.
Net income for the second quarter of 2017 increased by $5.3 million from
net income of $11.6 million for the three months ended June 30, 2016.
The operating income for the second quarter of 2017 increased by $5.9
million compared to the second quarter of 2016, mainly due to increased
earnings from the Raquel Knutsen, the Tordis Knutsen and
the Vigdis Knutsen being included in the Partnership’s results of
operations from December 1, 2016, March 1, 2017 and June 1, 2017,
respectively. Total finance expense for the three months ended June 30,
2017 increased by $0.6 million compared to the second quarter of 2016,
mainly due to additional debt due to the acquisitions of the Raquel
Knutsen, the Tordis Knutsen and the Vigdis Knutsen and
higher LIBOR margin. This was partially offset by changes in unrealized
gain and loss on derivative instruments.
Distributable cash flow was $23.4 million for the second quarter of
2017, compared to $15.6 million for the first quarter of 2017. The
increase in distributable cash flow is mainly due to full operational
performance of the fleet in the second quarter, including a full quarter
of earnings from the Tordis Knutsen and one month of earnings
from the Vigdis Knutsen, compared to 54.1 days of scheduled
offhire for the drydocking of the Windsor Knutsen and 14 days of
deductible offhire for the Raquel Knutsen in the first quarter of
2017. The distribution declared for the second quarter of 2017 was $0.52
per common unit, equivalent to an annualized distribution of $2.08.
Operational review
All thirteen of the Partnership’s vessels operated well throughout the
second quarter of 2017 with 100% utilization of the fleet, which
reflects 45 days of offhire for the Raquel Knutsen which was
reimbursed by the Partnership’s loss of hire insurance.
On July 14, 2017, Shell exercised its option to extend the time charter
of the Windsor Knutsen by one additional year until October 2018.
Following the exercise of the option, Shell has five remaining one-year
options to extend the time charter.
Financing and Liquidity
On May 26, 2017, the Partnership’s subsidiary, KNOT Shuttle Tankers 14
AS, which owns the Hilda Knutsen, entered into an agreement for a
new $100 million senior secured term loan facility with Mitsubishi UFJ
Lease & Finance (Hong Kong) Limited (the “New Hilda Facility”). The New
Hilda Facility replaced the existing $75.6 million loan facility secured
by the Hilda Knutsen, which was due to be paid in full in August
2018. The New Hilda Facility will be repayable in twenty-eight (28)
consecutive quarterly installments with a balloon payment of $58.5
million due at maturity. The New Hilda Facility bears interest at a rate
per annum equal to LIBOR plus a margin of 2.2%. The facility matures in
2024.
On August 9, 2017, the Partnership entered into an agreement with NTT
Finance Corporation for an unsecured revolving credit facility of $25
million. The facility will mature in August 2019, bear interest at LIBOR
plus a margin of 1.8% and have a commitment fee of 0.5% on the undrawn
portion of the facility. Closing of the facility is expected to occur by
the end of the August 2017.
As of June 30, 2017, the Partnership had $69.5 million in available
liquidity which consisted of cash and cash equivalents of $64.5 million
and $5.0 million of capacity under its $35.0 million revolving credit
facility. The revolving credit facility is available until June 10,
2019. The Partnership’s total interest-bearing debt outstanding as of
June 30, 2017 was $912.0 million ($905.9 million net of debt issuance
cost). The average margin paid on the Partnership’s outstanding debt
during the quarter ended June 30, 2017 was approximately 2.2% over LIBOR.
As of June 30, 2017, the Partnership had entered into foreign exchange
forward contracts, selling a total notional amount of $40.0 million
against the NOK at an average exchange rate of NOK 8.31 per
1.00 U.S. Dollar. These foreign exchange forward contracts are economic
hedges for certain vessel operating expenses and general expenses in NOK.
As of June 30, 2017, the Partnership had entered into various interest
rate swap agreements for a total notional amount of $536.7 million to
hedge against the interest rate risks of its variable rate borrowings.
As of June 30, 2017, the Partnership receives interest based on three or
six month LIBOR and pays a weighted average interest rate of 1.65% under
its interest rate swap agreements, which have an average maturity
of approximately 4.1 years. The Partnership does not apply hedge
accounting for derivative instruments, and its financial results are
impacted by changes in the market value of such financial instruments.
As of June 30, 2017, the Partnership’s net exposure to floating interest
rate fluctuations on its outstanding debt was approximately
$266.2 million based on total interest bearing debt outstanding of
$912.0 million, less interest rate swaps of $536.7 million, less a 3.85%
fixed rate export credit loan of $44.6 million and less cash and cash
equivalents of $64.5 million. The Partnership’s outstanding interest
bearing debt of $912.0 million as of June 30, 2017 is repayable as
follows:
(U.S. Dollars in thousands)
|
|
|
|
|
Period repayment
|
|
Balloon repayment
|
Remainder of 2017
|
|
|
|
|
$
|
33,331
|
|
|
$
|
—
|
|
2018
|
|
|
|
|
|
66,303
|
|
|
|
86,677
|
|
2019
|
|
|
|
|
|
50,085
|
|
|
|
267,678
|
|
2020
|
|
|
|
|
|
39,153
|
|
|
|
—
|
|
2021
|
|
|
|
|
|
39,753
|
|
|
|
70,811
|
|
2022 and thereafter
|
|
|
|
|
|
85,507
|
|
|
|
172,712
|
|
Total
|
|
|
|
|
$
|
314,132
|
|
|
$
|
597,878
|
|
|
Acquisition of Lena Knutsen
On August 9, 2017, the Partnership’s wholly owned subsidiary, KNOT
Shuttle Tankers AS, entered into a share purchase agreement to acquire
KNOT 26, the company that owns the shuttle tanker, Lena Knutsen,
from Knutsen NYK. The Partnership expects the Lena Acquisition to close
by September 30, 2017, subject to customary closing conditions. The
purchase price of the Lena Acquisition is $142.0 million, less
approximately $133.8 million of outstanding indebtedness related to the Lena
Knutsen plus approximately $24.1 million for a receivable owed by
Knutsen NYK to KNOT 26 (the “KNOT 26 Receivable”) and approximately $1.0
million for certain capitalized fees related to the financing of the Lena
Knutsen. On the closing of the Lena Acquisition, KNOT 26 will repay
approximately $41.9 million of the indebtedness, leaving an aggregate of
approximately $91.9 million of debt outstanding under the secured credit
facility related to the vessel (the “Lena Facility”). The Lena Facility
is repayable in quarterly installments with a final balloon payment of
$69.8 million due at maturity in June 2022. The Lena Facility bears
interest at an annual rate equal to LIBOR plus a margin of 1.9%.
The purchase price will be settled in cash and will be subject to
certain post-closing adjustments for currency fluctuations and accrued
interest on the KNOT 26 Receivable, working capital, Norwegian tonnage
entrance tax and interest rate swaps. On the closing of the Lena
Acquisition, Knutsen NYK will repay the KNOT 26 Receivable.
The Lena Knutsen was delivered in June 2017 and is scheduled to
operate in Brazil under a five-year time charter with a subsidiary of
Royal Dutch Shell plc, which is expected to commence in September 2017.
The charterer has options to extend the charter for two five-year
periods.
The Board and the Conflicts Committee have approved the purchase price
of the Lena Acquisition. The Conflicts Committee retained an outside
financial advisor to assist with its evaluation of the Lena Acquisition.
The Partnership estimates that the Lena Acquisition will generate
approximately $7.0 million of net income and approximately $15.8 million
of EBITDA4 for the twelve months following the closing of the
Lena Acquisition. However, the Partnership may not realize this level of
estimated net income or EBITDA from the Lena Acquisition during such
12-month period.
Series A Convertible Preferred Units
On June 30, 2017, the Partnership (i) issued and sold in a second
private placement 1,666,667 additional Series A Preferred Units at a
price of $24.00 per unit and (ii) amended and restated its partnership
agreement to make certain amendments to the terms of the Series A
Preferred Units, including the 2,083,333 Series A Preferred Units issued
on February 2, 2017. After deducting fees and expenses, the net proceeds
from the second private placement were $38.8 million. The Partnership
used $30.0 million of the net proceeds to repay the revolving credit
facility which was drawn in connection with the Vigdis Knutsen
acquisition.
Acquisition of Vigdis Knutsen
On June 1, 2017, the Partnership’s wholly owned subsidiary, KNOT Shuttle
Tankers AS, acquired KNOT Shuttle Tankers 25 (“KNOT 25”), the company
that owns the shuttle tanker, the Vigdis Knutsen, from Knutsen
NYK. The purchase price of the acquisition was $147.0 million, less
approximately $137.7 million of outstanding indebtedness related to the Vigdis
Knutsen plus approximately $17.9 million for a receivable owed by
Knutsen NYK to KNOT 25 (the “KNOT 25 Receivable”) and approximately $0.9
million for certain capitalized fees related to the financing of the Vigdis
Knutsen plus $3.7 million of post-closing adjustments for working
capital and interest rate swaps. On the closing of the Vigdis Knutsen acquisition,
KNOT 25 repaid approximately $42.9 million of the indebtedness, leaving
an aggregate of approximately $94.8 million of debt outstanding under
the secured credit facility related to the Vigdis Knutsen (the
“Vigdis Facility”). On the closing of the acquisition, Knutsen NYK
repaid the KNOT 25 Receivable. The purchase price was settled in cash.
KNOT 25 is the borrower under the Vigdis Facility, a senior secured loan
facility secured by a vessel mortgage on the Vigdis Knutsen. The
Vigdis Facility is guaranteed by the Partnership. The Vigdis Facility is
repayable in quarterly installments with a final balloon payment of
$70.8 million due at maturity in May 2022. The Vigdis Facility bears
interest at an annual rate equal to LIBOR plus a margin of 1.9%.
The Vigdis Knutsen was delivered in February 2017 and is
operating in Brazil under a five-year time charter with a subsidiary of
Royal Dutch Shell plc, which will expire in the second quarter of 2022.
The charterer has options to extend the charter for two five-year
periods.
The Partnership’s board of directors (the “Board”) and the conflicts
committee of the Board approved the purchase price of the acquisition.
The conflicts committee retained an outside financial advisor to assist
with its evaluation of the acquisition and the purchase price offered by
Knutsen NYK.
Outlook
The Partnership expects its earnings for the third quarter of 2017 to be
higher than its earnings for the second quarter of 2017, due to a full
quarter of earnings from the Vigdis Knutsen, as the vessel was
included in the Partnership’s results of operations from June 1, 2017.
These increased earnings will be slightly offset by approximately 7 days
of unplanned offhire for repair of damage sustained by the Tordis
Knutsen. There is no further expected offhire for the fleet during
the third quarter of 2017.
As of June 30, 2017, the Partnership’s fleet of thirteen vessels had an
average remaining fixed contract duration of 4.6 years. In addition, the
charterers of the Partnership’s time charter vessels have options to
extend their charters by an additional 4.1 years on average.
The Partnership expects to receive an option to acquire one additional
vessel owned by Knutsen NYK pursuant to the terms of the omnibus
agreement entered into in connection with the Partnership's initial
public offering (“IPO”). As of June 30, 2017, the remaining fixed
contract duration for the vessel is 5.0 years and the charterer has
options to extend the charter by 6.0 years.
On July 5, 2017, Knutsen NYK acquired from Chevron the Brazil Voyager,
a DP2 Suezmax class shuttle tanker built in 2013. The vessel, which is
located in Brazil, is not currently under contract. The vessel has been
renamed Brasil Knutsen, and Knutsen NYK is seeking to secure a
long-term time charter for it.
Pursuant to the omnibus agreement, the Partnership has the option to
acquire from Knutsen NYK any offshore shuttle tankers that Knutsen NYK
acquires or owns that are employed under charters for periods of five or
more years.
There can be no assurance that the Partnership will acquire any
additional vessels from Knutsen NYK.
The Board believes that demand for newbuild offshore shuttle tankers
will continue to be driven over time based on the requirement to replace
older tonnage in the North Sea and Brazil and further expansion into
deep water offshore oil production areas such as in Pre-salt Brazil and
the Barents Sea. The Board further believes that there will be and is
significant growth in demand for new shuttle tankers as the availability
of existing vessels has reduced and modern operational demands have
increased. Consequently, there should be opportunities to further grow
the Partnership.
About KNOT Offshore Partners LP
KNOT Offshore Partners owns operates and acquires shuttle tankers under
long-term charters in the offshore oil production regions of the North
Sea and Brazil. KNOT Offshore Partners owns and operates a fleet of
thirteen offshore shuttle tankers with an average age of 4.5 years.
KNOT Offshore Partners is structured as a publicly traded master limited
partnership. KNOT Offshore Partners’ common units trade on the New York
Stock Exchange under the symbol “KNOP.”
The Partnership plans to host a conference call on Thursday, August 10,
2017 at noon (Eastern Time) to discuss the results for the second
quarter of 2017, and invites all unitholders and interested parties to
listen to the live conference call by choosing from the following
options:
-
By dialing 1-855-209-8259 or 1-412-542-4105, if outside North America.
-
By accessing the webcast, which will be available for the next seven
days on the Partnership’s website: www.knotoffshorepartners.com.
August 9, 2017
KNOT Offshore Partners L.P.
Aberdeen, United
Kingdom
________________________________
1 EBITDA,
Adjusted EBITDA and distributable cash flow are non-GAAP financial
measures used by management and external users of the Partnership’s
financial statements. Please see Appendix A for definitions of EBITDA,
Adjusted EBITDA and distributable cash flow and a reconciliation to net
income, the most directly comparable GAAP financial measure.
2
Distribution coverage ratio is equal to distributable cash flow divided
by distributions declared for the period presented.
3
Reflects 45 days of offhire for the Raquel Knutsen in the three
months ended June 30, 2017 which was reimbursed by the Partnership’s
loss of hire insurance.
4 Please see Appendix A for
guidance on the underlying assumptions used to derive KNOT 26’s
estimated EBITDA and estimated net income, and a reconciliation of KNOT
26’s estimated EBITDA to estimated net income, the most directly
comparable GAAP financial measure for the twelve months following the
Lena Acquisition.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
June 30,
|
|
March 31,
|
|
June 30,
|
|
June 30,
|
|
June 30,
|
(U.S. Dollars in thousands)
|
|
2017
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
Time charter and bareboat revenues (1)
|
|
$
|
51,537
|
|
|
$
|
43,747
|
|
|
$
|
42,864
|
|
|
$
|
95,284
|
|
|
$
|
84,690
|
|
Loss of hire insurance recoveries
|
|
|
2,276
|
|
|
|
1,150
|
|
|
|
—
|
|
|
|
3,426
|
|
|
|
—
|
|
Other income (2)
|
|
|
593
|
|
|
|
95
|
|
|
|
199
|
|
|
|
687
|
|
|
|
399
|
|
Total revenues
|
|
|
54,406
|
|
|
|
44,992
|
|
|
|
43,063
|
|
|
|
99,397
|
|
|
|
85,089
|
|
Vessel operating expenses
|
|
|
9,427
|
|
|
|
10,282
|
|
|
|
7,975
|
|
|
|
19,709
|
|
|
|
15,622
|
|
Depreciation
|
|
|
17,372
|
|
|
|
15,753
|
|
|
|
13,913
|
|
|
|
33,125
|
|
|
|
27,805
|
|
General and administrative expenses
|
|
|
1,493
|
|
|
|
1,469
|
|
|
|
948
|
|
|
|
2,962
|
|
|
|
2,256
|
|
Total operating expenses
|
|
|
28,292
|
|
|
|
27,504
|
|
|
|
22,836
|
|
|
|
55,796
|
|
|
|
45,683
|
|
Operating income
|
|
|
26,114
|
|
|
|
17,488
|
|
|
|
20,227
|
|
|
|
43,601
|
|
|
|
39,406
|
|
Finance income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
44
|
|
|
|
36
|
|
|
|
—
|
|
|
|
80
|
|
|
|
3
|
|
Interest expense
|
|
|
(7,252
|
)
|
|
|
(6,215
|
)
|
|
|
(5,055
|
)
|
|
|
(13,466
|
)
|
|
|
(10,084
|
)
|
Other finance expense
|
|
|
(328
|
)
|
|
|
(302
|
)
|
|
|
(334
|
)
|
|
|
(630
|
)
|
|
|
(601
|
)
|
Realized and unrealized gain (loss) on derivative instruments (3)
|
|
|
(1,536
|
)
|
|
|
519
|
|
|
|
(3,176
|
)
|
|
|
(1,017
|
)
|
|
|
(6,360
|
)
|
Net gain (loss) on foreign currency transactions
|
|
|
(124
|
)
|
|
|
(94
|
)
|
|
|
(82
|
)
|
|
|
(218
|
)
|
|
|
(117
|
)
|
Total finance expense
|
|
|
(9,196
|
)
|
|
|
(6,056
|
)
|
|
|
(8,646
|
)
|
|
|
(15,251
|
)
|
|
|
(17,159
|
)
|
Income before income taxes
|
|
|
16,918
|
|
|
|
11,432
|
|
|
|
11,581
|
|
|
|
28,350
|
|
|
|
22,247
|
|
Income tax benefit (expense)
|
|
|
(3
|
)
|
|
|
(3
|
)
|
|
|
(3
|
)
|
|
|
(6
|
)
|
|
|
(6
|
)
|
Net income
|
|
|
16,915
|
|
|
|
11,429
|
|
|
|
11,578
|
|
|
|
28,344
|
|
|
|
22,241
|
|
Weighted average units outstanding (in thousands of units):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common units (4)
|
|
|
29,694
|
|
|
|
29,444
|
|
|
|
22,581
|
|
|
|
29,694
|
|
|
|
20,604
|
|
Subordinated units (4)
|
|
|
—
|
|
|
|
—
|
|
|
|
4,613
|
|
|
|
—
|
|
|
|
6,590
|
|
General Partner units
|
|
|
559
|
|
|
|
559
|
|
|
|
559
|
|
|
|
559
|
|
|
|
559
|
|
(1)
|
|
Time charter revenues for the second quarter of 2017, first quarter
of 2017 and second quarter of 2016 include a non-cash item of
approximately $0.8 million, $0.9 million and $1.0 million,
respectively, in reversal of contract liability provision, income
recognition of prepaid charter hire and accrued income for the Carmen
Knutsen based on the average charter rate for the fixed period.
|
(2)
|
|
Other income is mainly related to guarantee income from Knutsen NYK.
Pursuant to the omnibus agreement, Knutsen NYK agreed to guarantee
the payments of the hire rate that is equal to or greater than the
hire rate payable under the initial charters of the Bodil Knutsen
and the Windsor Knutsen for a period of five years from the
closing date of the IPO. In October 2015, the Windsor Knutsen
commenced operating under a new Shell time charter. The hire rate
for the new charter is below the initial charter hire rate and the
difference between the new hire rate and the initial rate is paid by
Knutsen NYK.
|
(3)
|
|
Realized gains (losses) on derivative instruments relate to amounts
the Partnership actually received (paid) to settle derivative
instruments, and the unrealized gains (losses) on derivative
instruments related to changes in the fair value of such derivative
instruments, as detailed in the table below:
|
(4)
|
|
On May 18, 2016, all subordinated units converted into common
units on a one-for-one basis.
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
June 30,
|
|
March 31,
|
|
June 30,
|
|
June 30,
|
|
June 30,
|
(U.S. Dollars in thousands)
|
|
2017
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swap contracts
|
|
$
|
(938
|
)
|
|
$
|
(669
|
)
|
|
$
|
(1,252
|
)
|
|
$
|
(1,607
|
)
|
|
$
|
(2,176
|
)
|
Foreign exchange forward contracts
|
|
|
(97
|
)
|
|
|
(69
|
)
|
|
|
(316
|
)
|
|
|
(166
|
)
|
|
|
(316
|
)
|
|
|
|
(1,035
|
)
|
|
|
(738
|
)
|
|
|
(1,568
|
)
|
|
|
(1,773
|
)
|
|
|
(2,492
|
)
|
Unrealized gain (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swap contracts
|
|
|
(1,334
|
)
|
|
|
1,059
|
|
|
|
(1,518
|
)
|
|
|
(275
|
)
|
|
|
(5,866
|
)
|
Foreign exchange forward contracts
|
|
|
833
|
|
|
|
198
|
|
|
|
(90
|
)
|
|
|
1,031
|
|
|
|
1,998
|
|
|
|
|
(501
|
)
|
|
|
1,257
|
|
|
|
(1,608
|
)
|
|
|
756
|
|
|
|
(3,868
|
)
|
Total realized and unrealized gain (loss)
|
|
|
(1,536
|
)
|
|
|
519
|
|
|
|
(3,176
|
)
|
|
|
(1,017
|
)
|
|
|
(6,360
|
)
|
|
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
|
|
(U.S. Dollars in thousands)
|
|
At June 30, 2017
|
|
|
At December 31, 2016
|
ASSETS
|
|
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
64,501
|
|
|
|
$
|
27,664
|
|
Amounts due from related parties
|
|
|
767
|
|
|
|
|
150
|
|
Inventories
|
|
|
1,712
|
|
|
|
|
1,176
|
|
Derivative assets
|
|
|
262
|
|
|
|
|
—
|
|
Other current assets
|
|
|
5,481
|
|
|
|
|
2,089
|
|
Total current assets
|
|
|
72,723
|
|
|
|
|
31,079
|
|
|
|
|
|
|
|
|
|
Long-term assets:
|
|
|
|
|
|
|
|
Vessels, net of accumulated depreciation
|
|
|
1,519,270
|
|
|
|
|
1,256,889
|
|
Intangible assets, net
|
|
|
2,800
|
|
|
|
|
—
|
|
Derivative assets
|
|
|
4,500
|
|
|
|
|
3,154
|
|
Accrued income
|
|
|
1,453
|
|
|
|
|
1,153
|
|
Total assets
|
|
$
|
1,600,746
|
|
|
|
$
|
1,292,275
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
|
|
Trade accounts payable
|
|
$
|
2,595
|
|
|
|
$
|
2,221
|
|
Accrued expenses
|
|
|
5,779
|
|
|
|
|
3,368
|
|
Current portion of long-term debt
|
|
|
65,018
|
|
|
|
|
58,984
|
|
Current portion of derivative liabilities
|
|
|
2,045
|
|
|
|
|
3,304
|
|
Income taxes payable
|
|
|
18
|
|
|
|
|
190
|
|
Current portion of contract liabilities
|
|
|
1,518
|
|
|
|
|
1,518
|
|
Prepaid charter and deferred revenue
|
|
|
7,578
|
|
|
|
|
7,218
|
|
Amount due to related parties
|
|
|
7,047
|
|
|
|
|
834
|
|
Total current liabilities
|
|
|
91,598
|
|
|
|
|
77,637
|
|
|
|
|
|
|
|
|
|
Long-term liabilities:
|
|
|
|
|
|
|
|
Long-term debt
|
|
|
840,882
|
|
|
|
|
657,662
|
|
Long-term debt from related parties
|
|
|
—
|
|
|
|
|
25,000
|
|
Derivative liabilities
|
|
|
793
|
|
|
|
|
285
|
|
Contract liabilities
|
|
|
7,480
|
|
|
|
|
8,239
|
|
Deferred tax liabilities
|
|
|
707
|
|
|
|
|
685
|
|
Other long-term liabilities
|
|
|
313
|
|
|
|
|
1,057
|
|
Total long-term liabilities
|
|
|
850,175
|
|
|
|
|
692,928
|
|
Total liabilities
|
|
|
941,773
|
|
|
|
|
770,565
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
Series A Convertible Preferred Units
|
|
|
88,451
|
|
|
|
|
—
|
|
Equity:
|
|
|
|
|
|
|
|
Partners’ capital:
|
|
|
|
|
|
|
|
Common unitholders
|
|
|
560,337
|
|
|
|
|
511,413
|
|
General partner interest
|
|
|
10,185
|
|
|
|
|
10,297
|
|
Total partners’ capital
|
|
|
570,522
|
|
|
|
|
521,710
|
|
Total liabilities and equity
|
|
$
|
1,600,746
|
|
|
|
$
|
1,292,275
|
|
|
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN
PARTNERS’ CAPITAL
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
Other
|
|
|
|
Series A
|
|
|
|
|
Comprehensive
|
|
Total Partners'
|
|
Convertible
|
|
|
Partners' Capital
|
|
Income (Loss)
|
|
Capital
|
|
Preferred Units
|
|
|
Common
|
|
Subordinated
|
|
General Partner
|
|
|
|
|
|
|
(U.S. Dollars in thousands)
|
|
Units
|
|
Units
|
|
Units
|
|
|
|
|
|
|
Consolidated balance at December 31, 2015
|
|
$
|
|
411,317
|
|
|
$
|
|
99,158
|
|
|
$
|
|
10,295
|
|
|
$
|
—
|
|
|
$
|
520,770
|
|
|
$
|
—
|
|
Net income
|
|
|
|
16,688
|
|
|
|
|
5,052
|
|
|
|
|
501
|
|
|
|
—
|
|
|
|
22,241
|
|
|
|
—
|
|
Other comprehensive income
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Cash distributions
|
|
|
|
(19,372
|
)
|
|
|
|
(10,088
|
)
|
|
|
|
(648
|
)
|
|
|
—
|
|
|
|
(30,108
|
)
|
|
|
—
|
|
Conversion of subordinated units to common units
|
|
|
|
94,123
|
|
|
|
|
(94,123
|
)
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Consolidated balance at June 30, 2016
|
|
$
|
|
502,756
|
|
|
$
|
|
—
|
|
|
$
|
|
10,148
|
|
|
$
|
—
|
|
|
$
|
512,903
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated balance at December 31, 2016
|
|
$
|
|
511,413
|
|
|
$
|
|
—
|
|
|
$
|
|
10,297
|
|
|
$
|
—
|
|
|
$
|
521,710
|
|
|
$
|
—
|
|
Net income
|
|
|
|
26,198
|
|
|
|
|
—
|
|
|
|
|
493
|
|
|
|
—
|
|
|
|
26,691
|
|
|
|
1,653
|
|
Other comprehensive income
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Cash distributions
|
|
|
|
(32,153
|
)
|
|
|
|
—
|
|
|
|
|
(605
|
)
|
|
|
—
|
|
|
|
(32,758
|
)
|
|
|
(645
|
)
|
Net proceeds from issuance of common units
|
|
|
|
54,879
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
54,879
|
|
|
|
—
|
|
Net proceeds from sale of Convertible Preferred Units
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
87,443
|
|
Consolidated balance at June 30, 2017
|
|
$
|
|
560,337
|
|
|
$
|
|
—
|
|
|
$
|
|
10,185
|
|
|
$
|
—
|
|
|
$
|
570,522
|
|
|
$
|
88,451
|
|
|
UNAUDITED CONSOLIDATED STATEMENT OF CASH FLOWS
|
|
|
|
Six Months ended
|
|
|
June 30,
|
(U.S. Dollars in thousands)
|
|
2017
|
|
2016
|
OPERATING ACTIVITIES
|
|
|
|
|
|
|
Net income
|
|
$
|
28,344
|
|
|
$
|
22,241
|
|
Adjustments to reconcile net income to cash provided by operating
activities:
|
|
|
|
|
|
|
Depreciation
|
|
|
33,125
|
|
|
|
27,805
|
|
Amortization of contract intangibles / liabilities
|
|
|
(632
|
)
|
|
|
(759
|
)
|
Amortization of deferred revenue
|
|
|
(743
|
)
|
|
|
(886
|
)
|
Amortization of deferred debt issuance cost
|
|
|
755
|
|
|
|
573
|
|
Drydocking expenditure
|
|
|
(3,800
|
)
|
|
|
(2,595
|
)
|
Income tax expense
|
|
|
6
|
|
|
|
6
|
|
Income taxes paid
|
|
|
(182
|
)
|
|
|
(241
|
)
|
Unrealized (gain) loss on derivative instruments
|
|
|
(757
|
)
|
|
|
3,868
|
|
Unrealized (gain) loss on foreign currency transactions
|
|
|
(2
|
)
|
|
|
63
|
|
Changes in operating assets and liabilities
|
|
|
|
|
|
|
Decrease (increase) in amounts due from related parties
|
|
|
38,590
|
|
|
|
33
|
|
Decrease (increase) in inventories
|
|
|
(216
|
)
|
|
|
75
|
|
Decrease (increase) in other current assets
|
|
|
(1,914
|
)
|
|
|
94
|
|
Decrease (increase) in accrued revenue
|
|
|
(300
|
)
|
|
|
(706
|
)
|
Increase (decrease) in trade accounts payable
|
|
|
71
|
|
|
|
(87
|
)
|
Increase (decrease) in accrued expenses
|
|
|
826
|
|
|
|
(419
|
)
|
Increase (decrease) prepaid revenue
|
|
|
360
|
|
|
|
3,776
|
|
Increase (decrease) in amounts due to related parties
|
|
|
4,490
|
|
|
|
(356
|
)
|
Net cash provided by operating activities
|
|
|
98,021
|
|
|
|
52,485
|
|
|
|
|
|
|
|
|
INVESTING ACTIVITIES
|
|
|
|
|
|
|
Disposals (additions) to vessel and equipment
|
|
|
(180
|
)
|
|
|
(521
|
)
|
Acquisition of Tordis Knutsen (net of cash acquired)
|
|
|
(32,374
|
)
|
|
|
—
|
|
Acquisition of Vigdis Knutsen (net of cash acquired)
|
|
|
(28,321
|
)
|
|
|
—
|
|
Net cash used in investing activities
|
|
|
(60,875
|
)
|
|
|
(521
|
)
|
|
|
|
|
|
|
|
FINANCING ACTIVITIES
|
|
|
|
|
|
|
Proceeds from long-term debt
|
|
|
130,000
|
|
|
|
5,000
|
|
Repayment of long-term debt
|
|
|
(167,460
|
)
|
|
|
(24,642
|
)
|
Repayment of long-term debt from related parties
|
|
|
(70,663
|
)
|
|
|
-
|
|
Payment on debt issuance cost
|
|
|
(1,140
|
)
|
|
|
(144
|
)
|
Cash distribution
|
|
|
(33,403
|
)
|
|
|
(30,107
|
)
|
Net proceeds from issuance of common units
|
|
|
54,879
|
|
|
|
—
|
|
Net proceeds from sale of Convertible Preferred Units
|
|
|
87,443
|
|
|
|
—
|
|
Net cash used in financing activities
|
|
|
(344
|
)
|
|
|
(49,893
|
)
|
Effect of exchange rate changes on cash
|
|
|
35
|
|
|
|
23
|
|
Net increase in cash and cash equivalents
|
|
|
36,837
|
|
|
|
2,094
|
|
Cash and cash equivalents at the beginning of the period
|
|
|
27,664
|
|
|
|
23,573
|
|
Cash and cash equivalents at the end of the period
|
|
$
|
64,501
|
|
|
$
|
25,667
|
|
|
APPENDIX A—RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
Distributable Cash Flow (“DCF”)
Distributable cash flow represents net income adjusted for depreciation,
unrealized gains and losses from derivatives, unrealized foreign
exchange gains and losses, distributions on the Series A Preferred
Units, other non-cash items and estimated maintenance and replacement
capital expenditures. Estimated maintenance and replacement capital
expenditures, including estimated expenditures for drydocking, represent
capital expenditures required to maintain over the long-term the
operating capacity of, or the revenue generated by, the Partnership’s
capital assets. The Partnership believes distributable cash flow is an
important measure of operating performance used by management and
investors in publicly-traded partnerships to compare cash generating
performance of the Partnership from period to period and to compare the
cash generating performance for specific periods to the cash
distributions (if any) that are expected to be paid to our unitholders.
Distributable cash flow is a non-GAAP financial measure and should not
be considered as an alternative to net income or any other indicator of
KNOT Offshore Partners’ performance calculated in accordance with GAAP.
The table below reconciles distributable cash flow to net income, the
most directly comparable GAAP measure.
|
|
|
Three Months Ended
|
|
|
Three Months Ended
|
|
|
|
June 30,
|
|
|
March 31,
|
|
|
|
2017
|
|
|
2017
|
(U.S. Dollars in thousands)
|
|
|
(unaudited)
|
|
|
(unaudited)
|
Net income
|
|
|
$
|
16,915
|
|
|
|
$
|
11,429
|
|
Add:
|
|
|
|
|
|
|
|
|
Depreciation
|
|
|
|
17,372
|
|
|
|
|
15,753
|
|
Other non-cash items; deferred costs amortization debt
|
|
|
|
407
|
|
|
|
|
348
|
|
Unrealized losses from interest rate derivatives and foreign
exchange currency contracts
|
|
|
|
1,334
|
|
|
|
|
—
|
|
Less:
|
|
|
|
|
|
|
|
|
Estimated maintenance and replacement capital expenditures
(including drydocking reserve)
|
|
|
|
(9,990
|
)
|
|
|
|
(9,120
|
)
|
Distribution to Series A Preferred Units
|
|
|
|
(1,009
|
)
|
|
|
|
(645
|
)
|
Other non-cash items; deferred revenue
|
|
|
|
(650
|
)
|
|
|
|
(726
|
)
|
Other non-cash items; accrued income
|
|
|
|
(151
|
)
|
|
|
|
(149
|
)
|
Unrealized gains from interest rate derivatives and foreign exchange
currency contracts
|
|
|
|
(833
|
)
|
|
|
|
(1,258
|
)
|
Distributable cash flow
|
|
|
$
|
23,395
|
|
|
|
$
|
15,632
|
|
Distributions declared
|
|
|
$
|
16,379
|
|
|
|
$
|
16,379
|
|
Distribution coverage ratio(1)
|
|
|
|
1.43
|
|
|
|
|
0.95
|
|
|
(1) Distribution coverage ratio is equal to distributable cash
flow divided by distributions declared for the period presented.
|
|
EBITDA and Adjusted EBITDA
EBITDA is defined as earnings before interest, depreciation and taxes.
Adjusted EBITDA refers to earnings before interest, depreciation, taxes,
goodwill impairment charges and other financial items (including other
finance expenses, realized and unrealized gain (loss) on derivative
instruments and net gain (loss) on foreign currency transactions).
EBITDA is used as a supplemental financial measure by management and
external users of financial statements, such as our lenders, to assess
our financial and operating performance and our compliance with the
financial covenants and restrictions contained in our financing
agreements. Adjusted EBITDA is used as a supplemental financial measure
by management and external users of financial statements, such as
investors, to assess our financial and operating performance. The
Partnership believes that EBITDA and Adjusted EBITDA assist its
management and investors by increasing the comparability of its
performance from period to period and against the performance of other
companies in its industry that provide EBITDA and Adjusted EBITDA
information. This increased comparability is achieved by excluding the
potentially disparate effects between periods or companies of interest,
other financial items, taxes, goodwill impairment charges and
depreciation, as applicable, which items are affected by various and
possibly changing financing methods, capital structure and historical
cost basis and which items may significantly affect net income between
periods. The Partnership believes that including EBITDA and Adjusted
EBITDA as financial measures benefits investors in (a) selecting between
investing in the Partnership and other investment alternatives and
(b) monitoring the Partnership’s ongoing financial and operational
strength in assessing whether to continue to hold common units. EBITDA
and Adjusted EBITDA are non-GAAP financial measures and should not be
considered as alternatives to net income or any other indicator of
Partnership performance calculated in accordance with GAAP.
The table below reconciles EBITDA and Adjusted EBITDA to net income, the
most directly comparable GAAP measure.
|
|
|
|
Three Months Ended
|
|
Three Months Ended
|
|
|
|
|
June 30,
|
|
March 31,
|
|
|
|
|
2017
|
|
2017
|
(USD in thousands)
|
|
|
|
(unaudited)
|
|
(unaudited)
|
Net income
|
|
|
|
$
|
16,915
|
|
|
$
|
11,429
|
|
Interest income
|
|
|
|
|
(44
|
)
|
|
|
(36
|
)
|
Interest expense
|
|
|
|
|
7,252
|
|
|
|
6,215
|
|
Depreciation
|
|
|
|
|
17,372
|
|
|
|
15,753
|
|
Income tax expense
|
|
|
|
|
3
|
|
|
|
3
|
|
EBITDA
|
|
|
|
|
41,498
|
|
|
|
33,364
|
|
Other financial items (a)
|
|
|
|
|
1,988
|
|
|
|
(123
|
)
|
Adjusted EBITDA
|
|
|
|
$
|
43,486
|
|
|
$
|
33,241
|
|
____________
|
(a)
|
|
Other financial items consist of other finance expense, realized and
unrealized gain (loss) on derivative instruments and net gain (loss)
on foreign currency transactions.
|
|
Estimated Net Income and Estimated EBITDA for KNOT 26 for the Twelve
Months Following the Closing of the Acquisition
For KNOT 26, the entity that the Partnership intends to purchase in the
Lena Acquisition, estimated net income and estimated EBITDA for the
twelve months following the closing of the Lena Acquisition are based on
the following assumptions:
-
timely receipt of charter hire specified in the time charter contract;
-
utilization of the Lena Knutsen for 363 days during such
12-month period and no drydocking of the vessel;
-
no realized or unrealized gains or losses on derivative instruments
related to KNOT 26’s financing arrangements;
-
vessel operating costs according to current internal estimates; and
-
general and administrative expenses based on management’s current
internal estimates.
We consider the above assumptions to be reasonable as of the date of
this press release, but if these assumptions prove to be incorrect,
actual net income and EBITDA for KNOT 26 could differ materially from
our estimates. Neither our independent auditors nor any other
independent accountants have compiled, examined, or performed any
procedures with respect to the prospective financial information
contained herein, nor have they expressed any opinion or any other form
of assurance on such information or its achievability and assume no
responsibility for, and disclaim any association with, such prospective
financial information.
The table below reconciles for the twelve months following the closing
of the Lena Acquisition, estimated EBITDA to estimated net income, the
most directly comparable GAAP measure:
(USD in thousands)
|
|
|
|
KNOT 26
|
Net income
|
|
|
|
$
|
|
|
7,000
|
|
Interest expense
|
|
|
|
|
|
|
3,000
|
|
Depreciation
|
|
|
|
|
|
|
5,800
|
|
Income tax expense
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
|
$
|
|
|
15,800
|
|
|
|
|
|
|
|
|
|
|
FORWARD-LOOKING STATEMENTS
This press release contains certain forward-looking statements
concerning future events and KNOT Offshore Partners’ operations,
performance and financial condition. Forward-looking statements include,
without limitation, any statement that may predict, forecast, indicate
or imply future results, performance or achievements, and may contain
the words “believe,” “anticipate,” “expect,” “estimate,” “project,”
“will be,” “will continue,” “will likely result,” “plan,” “intend” or
words or phrases of similar meanings. These statements involve known and
unknown risks and are based upon a number of assumptions and estimates
that are inherently subject to significant uncertainties and
contingencies, many of which are beyond KNOT Offshore Partners’ control.
Actual results may differ materially from those expressed or implied by
such forward-looking statements. Forward-looking statements include
statements with respect to, among other things:
-
market trends in the shuttle tanker or general tanker industries,
including hire rates, factors affecting supply and demand, and
opportunities for the profitable operations of shuttle tankers;
-
Knutsen NYK’s and KNOT Offshore Partners’ ability to build shuttle
tankers and the timing of the delivery and acceptance of any such
vessels by their respective charterers;
-
forecasts of KNOT Offshore Partners’ ability to make or increase
distributions on its common units and to make distributions on its
Series A Preferred Units and the amount of any such distributions;
-
KNOT Offshore Partners’ ability to integrate and realize the expected
benefits from acquisitions, including the acquisition of KNOT 25 and
the intended acquisition of KNOT 26;
-
the estimated net income and estimated EBITDA relating to the intended
acquisition of KNOT 26 for the twelve months following the closing of
the Lena Acquisition;
-
KNOT Offshore Partners’ anticipated growth strategies;
-
the effects of a worldwide or regional economic slowdown;
-
turmoil in the global financial markets;
-
fluctuations in currencies and interest rates;
-
fluctuations in the price of oil;
-
general market conditions, including fluctuations in hire rates and
vessel values;
-
changes in KNOT Offshore Partners’ operating expenses, including
drydocking and insurance costs and bunker prices;
-
KNOT Offshore Partners’ future financial condition or results of
operations and future revenues and expenses;
-
the repayment of debt and settling of any interest rate swaps;
-
KNOT Offshore Partners’ ability to make additional borrowings and to
access debt and equity markets;
-
planned capital expenditures and availability of capital resources to
fund capital expenditures;
-
KNOT Offshore Partners’ ability to maintain long-term relationships
with major users of shuttle tonnage;
-
KNOT Offshore Partners’ ability to leverage Knutsen NYK’s
relationships and reputation in the shipping industry;
-
KNOT Offshore Partners’ ability to purchase vessels from Knutsen NYK
in the future;
-
KNOT Offshore Partners’ continued ability to enter into long-term
charters, which KNOT Offshore Partners defines as charters of five
years or more;
-
KNOT Offshore Partners’ ability to maximize the use of its vessels,
including the re-deployment or disposition of vessels no longer under
long-term charter;
-
the financial condition of KNOT Offshore Partners’ existing or future
customers and their ability to fulfill their charter obligations;
-
timely purchases and deliveries of newbuilds;
-
future purchase prices of newbuilds and secondhand vessels;
-
any impairment of the value of KNOT Offshore Partners’ vessels;
-
KNOT Offshore Partners’ ability to compete successfully for future
chartering and newbuild opportunities;
-
acceptance of a vessel by its charterer;
-
termination dates and extensions of charters;
-
the expected cost of, and KNOT Offshore Partners’ ability to, comply
with governmental regulations, maritime self-regulatory organization
standards, as well as standard regulations imposed by its charterers
applicable to KNOT Offshore Partners’ business;
-
availability of skilled labor, vessel crews and management;
-
KNOT Offshore Partners’ general and administrative expenses and its
fees and expenses payable under the technical management agreements,
the management and administration agreements and the administrative
services agreement;
-
the anticipated taxation of KNOT Offshore Partners and distributions
to KNOT Offshore Partners’ unitholders;
-
estimated future maintenance and replacement capital expenditures;
-
KNOT Offshore Partners’ ability to retain key employees;
-
customers’ increasing emphasis on environmental and safety concerns;
-
potential liability from any pending or future litigation;
-
potential disruption of shipping routes due to accidents, political
events, piracy or acts by terrorists;
-
future sales of KNOT Offshore Partners’ securities in the public
market;
-
KNOT Offshore Partners’ business strategy and other plans and
objectives for future operations; and
-
other factors listed from time to time in the reports and other
documents that KNOT Offshore Partners files with the U.S Securities
and Exchange Commission, including its Annual Report on Form 20-F for
the year ended December 31, 2016.
All forward-looking statements included in this release are made only as
of the date of this release on. New factors emerge from time to time,
and it is not possible for KNOT Offshore Partners to predict all of
these factors. Further, KNOT Offshore Partners cannot assess the impact
of each such factor on its business or the extent to which any factor,
or combination of factors, may cause actual results to be materially
different from those contained in any forward-looking statement. KNOT
Offshore Partners does not intend to release publicly any updates or
revisions to any forward-looking statements contained herein to reflect
any change in KNOT Offshore Partners’ expectations with respect thereto
or any change in events, conditions or circumstances on which any such
statement is based.

View source version on businesswire.com: http://www.businesswire.com/news/home/20170809005631/en/
Source: Knot Offshore Partners