XML 62 R46.htm IDEA: XBRL DOCUMENT v3.19.1
Derivative Instruments and Hedging Activities (Tables)
 12 Months Ended
Dec. 31, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Commitment of Cross Currency Swaps
As at December 31, 2018, Teekay LNG was committed to the following cross currency swaps:
Notional Amount NOK
 
Notional Amount USD
 
 
 
 
 
 
 
Fair Value / Carrying Amount of (Liability) / Asset
 
Remaining
Term (years)
Floating Rate Receivable
 
 
 
Reference Rate
 
Margin
 
Fixed Rate Payable
 
1,000,000
 
134,000

 
NIBOR
 
3.70
%
 
5.92
%
 
(18,315
)
 
1.4
1,200,000
 
146,500

 
NIBOR
 
6.00
%
 
7.72
%
 
(4,727
)
 
2.8
850,000
 
102,000

 
NIBOR
 
4.60
%
 
7.89
%
 
(6,080
)
 
4.7
 
 
 
 
 
 
 
 
 
 
(29,122
)
 
 
Interest Rate Swap Agreements
As at December 31, 2018, the Company was committed to the following interest rate swap agreements related to its LIBOR-based debt and EURIBOR-based debt, whereby certain of the Company’s floating-rate debt obligations were swapped with fixed-rate obligations:
 
Interest
Rate
Index
 
Principal
Amount
$
 
Fair Value /
Carrying
Amount of
Asset /
(Liability)
$
 
Weighted-
Average
Remaining
Term
(years)
 
Fixed
Interest
Rate
(%) (1)
LIBOR-Based Debt:
 
 
 
 
 
 
 
 
 
U.S. Dollar-denominated interest rate swaps (2)
LIBOR
 
1,162,476

 
(22,443
)
 
3.7
 
2.9
EURIBOR-Based Debt:
 
 
 
 
 
 
 
 
 
Euro-denominated interest rate swaps
EURIBOR
 
86,477

 
(11,092
)
 
4.7
 
3.8
 
 
 
 
 
(33,535
)
 
 
 
 
(1)
Excludes the margins the Company pays on its variable-rate debt, which, as of December 31, 2018, ranged from 0.3% to 3.95%.
(2)
Includes interest rate swaps with the notional amount reducing quarterly or semi-annually. Two interest rate swaps are subject to mandatory early termination in 2020 and 2021, at which time the swaps will be settled based on their fair value.
Location and Fair Value Amounts of Derivative Instruments
The following table presents the location and fair value amounts of derivative instruments, segregated by type of contract, on the Company’s consolidated balance sheets.
 
Prepaid Expenses and Other
 
Other Non-Current Assets
 
Accrued Liabilities and Other
 
Current
Portion of
Derivative
Liabilities
 
Derivative
Liabilities
As at December 31, 2018
 
 
 
 
 
 
 
 
 
Derivatives designated as a cash flow hedge:
 
 
 
 
 
 
 
 
 
Interest rate swap agreements
784

 
2,362

 
20

 
—

 
—

Derivatives not designated as a cash flow hedge:

 

 

 

 

Foreign currency contracts
—

 
—

 
—

 
—

 
—

Interest rate swap agreements
2,915

 
2,973

 
(2,498
)
 
(7,419
)
 
(32,672
)
Cross currency swap agreements
—

 
—

 
(713
)
 
(4,729
)
 
(23,680
)
Stock purchase warrants
—

 
12,026

 
—

 
—

 
—

Forward freight agreements
—

 
—

 
—

 
(57
)
 
—

 
3,699

 
17,361

 
(3,191
)
 
(12,205
)
 
(56,352
)
As at December 31, 2017
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 
Derivatives designated as a cash flow hedge:
 
 
 
 
 
 
 
 
 
Interest rate swap agreements
—

 
1,037

 
(18
)
 
(751
)
 
(7
)
Derivatives not designated as a cash flow hedge:
 
 
 
 
 
 
 
 
 
Foreign currency contracts
96

 
—

 
—

 
(15
)
 
—

Interest rate swap agreements
1,124

 
4,319

 
(4,836
)
 
(35,134
)
 
(38,213
)
Cross currency swap agreements
—

 
5,042

 
(810
)
 
(44,523
)
 
(10,168
)
Stock purchase warrants
—

 
30,749

 
—

 
—

 
—

 
1,220

 
41,147

 
(5,664
)
 
(80,423
)
 
(48,388
)
Effective Portion of Gains (Losses) on Interest Rate Swap Agreements
For the periods indicated, the following table presents the effective portion of gains (losses) on consolidated interest rate swap agreements designated and qualifying as cash flow hedges:
Year Ended December 31, 2018
Effective Portion
 
Effective Portion
 
Ineffective
 
 
Recognized in AOCI (1)
 
Reclassified from AOCI (2)
 
Portion (3)
 
 
$
 
$
 
$
 
 
2,128

 
(152
)
 
740

 
Interest expense

Year Ended December 31, 2017
Effective Portion
 
Effective Portion
 
Ineffective
 
 
Recognized in AOCI (1)
 
Reclassified from AOCI (2)
 
Portion (3)
 
 
$
 
$
 
$
 
 
(31
)
 
(1,614
)
 
(746
)
 
Interest expense
(1) Recognized in accumulated other comprehensive loss (or AOCI).
(2) Recorded in AOCI during the term of the hedging relationship and reclassified to earnings.
(3) Recognized in the ineffective portion of gains (losses) on derivative instruments designated and qualifying as cash flow hedges.
Effect of Gain (Loss) on Derivatives Not Designated as Hedging Instruments
The effect of the (losses) and gains on derivatives not designated as hedging instruments in the consolidated statements of (loss) income are as follows:
 
Year Ended
December 31, 2018
$
 
Year Ended
December 31, 2017
$
 
Year Ended
December 31, 2016
$
Realized (losses) gains relating to:
 
 
 
 
 
Interest rate swap agreements
(13,898
)
 
(53,921
)
 
(87,320
)
Interest rate swap agreement terminations
(13,681
)
 
(610
)
 
(8,140
)
Foreign currency forward contracts
—

 
667

 
(11,186
)
Time charter swap agreement
—

 
1,106

 
2,154

Forward freight agreements
137

 
270

 
—

 
(27,442
)
 
(52,488
)
 
(104,492
)
Unrealized gains (losses) relating to:
 
 
 
 
 
Interest rate swap agreements
33,700

 
17,005

 
62,446

Foreign currency forward contracts
—

 
3,925

 
15,833

Stock purchase warrants
(21,053
)
 
(6,421
)
 
(9,753
)
Time-charter swap agreement
—

 
(875
)
 
875

Forward Freight Agreements
(57
)
 
—

 
—

 
12,590

 
13,634

 
69,401

Total realized and unrealized losses on derivative instruments
(14,852
)
 
(38,854
)
 
(35,091
)
Effect of Gains (Losses) on Cross Currency Swaps
The effect of the gains (losses) on cross currency swaps on the consolidated statements of (loss) income is as follows:
 
Year Ended December 31,
 
2018
$
 
2017
$
 
2016
$
Realized losses on maturity and/or partial termination of cross currency swap
(42,271
)
 
(25,733
)
 
(41,707
)
Realized losses
(6,533
)
 
(18,494
)
 
(38,564
)
Unrealized gains
21,240

 
82,668

 
75,033

Total realized and unrealized (losses) gains on cross currency swaps
(27,564
)
 
38,441

 
(5,238
)