Good day, and welcome to Teekay Corporation's 4th Quarter and Fiscal 2019 Earnings Results Conference Call. During the call, all participants will be in a listen only mode. Afterwards, you will be invited to participate in a question and answer session. As a reminder, this call is being recorded. Now for opening remarks and introductions, I would like to turn the call over to the company.
Please go ahead.
Before we begin,
I'd like to direct all participants to our website at www.teekay.com, where you'll find a copy of the Q4 and annual 2019 earnings presentation. Kenneth Vitt and Vince Locke will review this presentation during today's conference call. Please allow me to remind you that our discussion today contains forward looking statements. Actual results may differ materially from the results projected by those forward looking statements. Additional information concerning factors that could cause actual results to materially differ from those in the forward looking statements is contained in the Q4 and annual 2019 earnings release and earnings presentation available on our website.
I'll now turn the call over to Vince to begin.
Thanks, Ryan, and thank you all for joining us today for Teekay Corporation's 4th quarter and annual 2019 earnings conference call. I will briefly review our 4th quarter results before I hand the call over to Kenneth. Starting with Slide 3 of the presentation. The Q4 of 2019 marked a return to profitability for Teekay as we recorded consolidated adjusted net income of $31,000,000 or $0.31 per share compared to an adjusted net loss of $2,000,000 or $0.02 per share in the same period of the prior year. We also generated total adjusted EBITDA of $324,000,000 an increase of $113,000,000 or 53% from the same period in the prior year, excluding the contribution from Teekay Offshore, which we sold in May of 2019.
Our 4th quarter consolidated results were positively impacted by significantly stronger spot tanker rates at Teekay Tankers, the start up of various growth projects and higher charter rates secured on certain LNG carriers at Teekay LNG, improved results from our directly owned FPSO units and lower G and A expenses across the group. In addition, we narrowed our consolidated adjusted net loss in fiscal year 2019 to $19,000,000 from $53,000,000 in 2018 and we continue to expect 2020 to be a profitable year. Teekay Parent generated positive adjusted EBITDA of $14,000,000 in the 4th quarter, which includes EBITDA from our directly owned assets and cash distributions from our publicly traded daughter entities. Our results were up compared to the Q4 of 2018, mainly as a result of lower interest expense due to bond repurchases over the past year and our bond refinancing completed in May 2019, higher contributions from the Banff and Hummingbird Spirit FPSO units, a 36% increase in TGP's quarterly cash distribution and lower G and A expenses. For further details on our Q4 results as well as our Q1 outlook, please refer to the slides in the appendices to this presentation.
Overall, we are expecting another strong Q1 a strong quarter in Q1. On the balance sheet side, in January 2020, Teekay Parent eliminated $52,000,000 of debt guarantees previously provided to Teekay Tankers as a result of their $533,000,000 refinancing completed during that month. And we fully repaid the remaining balance on our 2020 unsecured bond with cash. I will now turn the call over to Kenneth.
Thank you, Vince, and hello, everyone. Turning to Slide 4. When we presented at our Investor Day in November, our key message was that over the past 3 years, we have significantly de risked the Teekay Group and that we expect stronger earnings and continued balance sheet delevering across our businesses. We believe that the derisking of the Teekay Group has set us up to not only weather, but actually continue to thrive during market volatility. First, let's start off on the near term.
On the gas side, we've seen significant declines in LNG prices in Asia and Europe with Asia reaching levels below $3 per MMBtu, primarily due to the coronavirus outbreak and milder winter weather, which has put pressure on spot LNG shipping rates. On the tanker side, crude spot tanker rates reached the highest level since 2,008 due to positive underlying tanker supply and demand fundamentals, normal winter seasonality as well as one off events such as U. S. Sanctions on Costco that removed 26 VLCCs from the trading fleet, floating storage ahead of the implementation of IMO 2020 and the removal of vessels from the global trading fleet to retrofit scrubbers. However, the crude spot tanker market has come under pressure in recent weeks on the back of the coronavirus and the U.
S. Lifting sanctions on Costco, with the former leading to a downgrade in oil demand by the IEA. It is highly uncertain how long this volatility will continue, but we believe the Teekay Group is well positioned with our gas business being very well insulated from the near term weakness in the spot LNG shipping market due to its unrivaled portfolio of long term contracts with no charter market exposure whatsoever through the first half of the year, 97% fixed employment in 2020 92% in 2021 for its LNG fleet and with our tanker business having greater financial flexibility as a result of a stronger balance sheet and a much healthier liquidity position, which we'll touch on in more detail later in this presentation. Looking ahead, we believe the medium term fundamentals remain intact with a record year in 2019 for new LNG projects reaching final investment decision that are expected to start up in 2022 onwards and long term demand for LNG expected to rise by 4% to 5% per year to 2,030 as LNG continues to displace coal. For our crude tankers, we see strong underlying supply and demand fundamentals with a crude tanker order book at 20 year lows measured as a percentage of the existing fleet.
Turning to Slide 5, we have provided a graph of our annual total adjusted EBITDA over the past 3 years that adjusted for our sale of Teekay Offshore has increased by 66% since 2017, primarily underpinned by our stable and growing cash flows from our gas business that have increased by 52% during this time. We expect our total adjusted EBITDA to continue to grow in 2020 with our gas cash flows expected to grow another 10% to 14% in 2020 compared to 2019 and a full year of potentially stronger earnings from our tanker business. Turning to Slide 6, I'll provide a brief update on our 3 directly owned FPSOs. On the Foinaven FPSO, we are now in advanced stages of discussions with BP for new contracting structure on the unit to address the negative EBITDA that we have incurred on this unit and will provide an update to the market at the appropriate time. The Humminbird Spirit continues to operate on its contract out to 2023 and the customer continues to execute on its previously announced drilling campaign aimed at extending the production life of the field, and we are continuing to pursue a divestment of this asset.
On the Banff FPSO, as highlighted at our Investor Day in November, there will likely be no further contract extensions on the existing field as a result of low gas prices and we're now preparing for the cessation of production on the field and decommissioning commencing in mid-twenty 20 and we're marketing this unit for sale. Our FPSO results improved significantly in the 4th quarter as the units ramped up production following plant maintenance in the Q3 and the recognition of approximately $8,000,000 in operational tariff revenues from the Foinaven, which is typically recognized in the Q4 of each year. Looking ahead to the Q1, we expect our FPSO cash flows to be lower mainly due to the annual operational tariff revenue recognized in the 4th quarter and higher operating expenses in the Q1 relating to the Foinaven. As mentioned earlier, the negative EBITDA is driven all by the Foinaven FPSO, which we are in advanced stages of addressing. Consistent with our recent Teekay Group Investor Day, we have decided to change the order of our earnings calls with Teekay Corporation going first, followed by Teekay LNG and then Teekay Tankers.
As a result, I will only briefly touch on the results and highlights of our daughter companies, and I would encourage you to listen to their respective earnings conference calls for more details following this call. On Slide 7, we have summarized Teekay LNG's recent results and highlights. Teekay LNG Partners reported strong Q4 and fiscal 2019 results that were within its guidance, generating total adjusted EBITDA of $184,000,000 and adjusted net income of $50,000,000 or $0.56 per unit, up significantly during the quarter compared to the same period of the prior year as growth projects continue to drive higher earnings and cash flows. We expect these results to continue to grow in 2020 with adjusted earnings per unit expected to be 45% to 73% higher than 2019. Teekay LNG has reached an important milestone with the completion of its growth program with the delivery of its 5th and 6th 50 percent ARC7 LNG carrier newbuilding for the Yamal LNG project which immediately commenced respective 26 year charter contracts as well as its 30% owned Bahrain Regas Terminal completed mechanical, construction and commissioning and began receiving revenues in early January.
Also in early January, a Wilco LNG fulfilled its obligation to repurchase 2 of GDP's LNG carriers, resulting in receipt of over $260,000,000 in cash that was used to delever its balance sheet and increased its liquidity by over $100,000,000 Additionally, Teekay LNG continues to execute on its balanced capital allocation strategy, which includes prioritizing balance sheet delivering for now and a second consecutive year of over 30% increase in quarterly cash distributions with a 32% increase commencing in May 2020. As outlined on the graph on the far right, this approach has allowed for significant delevering from a proportionate net debt to a total adjusted EBITDA of 9.1 times in 2018 to 6.4 times based on our Q4 2019 annualized results, pro form a for the Awilco transaction that I touched on earlier. This is creating significant equity value for all Teekay LNG unitholders with more to come as Teekay LNG approaches its target leverage of around 4.5x to 5.5x and which is expected to result in significantly increased financial flexibility. Lastly, since December 2018, TGP has opportunistically re $12.85 per unit. Turning to Slide 8, Teekay Tankers reported record high adjusted net income in the 4th quarter generating total adjusted EBITDA of $132,000,000 up from $62,000,000 in the same period of the prior year and adjusted net income of $83,000,000 or $2.47 per share in the 4th quarter, an improvement from $14,000,000 or $0.42 per share in the same period of the prior year.
TNK's results were driven by stronger spot tanker rates, which reached the highest level since 2,008. This strength continued into the Q1 of 2020. And I'm pleased to report that the tanker rates we have secured so far in Q1 are even higher with 77% of Q1 Suezmax days fixed at $51,700 per day and 63% of Q1 Aframax and LR2 days fixed at 38 $1,600 per day compared to $39,133,000 per day in the 4th quarter respectively. Since November 2019, Teekay Tankers has taken significant steps to bolster its balance sheet from strong operating cash flows, securing $104,000,000 of opportunistic asset sales and securing a new 5 year $533,000,000 long term revolving credit facility, which on a pro form a basis has reduced TNK's net debt by $153,000,000 or 15% since the end of the third quarter and significantly increased its liquidity to approximately $260,000,000 Looking ahead, T and K continues to maintain significant operating leverage as highlighted in the graph on the bottom right hand side of the slide. On an annualized basis, the rates that we achieved in the Q4 of 2019 would translate to over $320,000,000 of free cash flow or over $9.50 per share.
This is compelling relative to TNK's closing share price yesterday of $12.66 per share and equates to a free cash flow yield of 75%. Turning to Slide 9. In spite of the market volatility, we have continued to execute on our business plan to create intrinsic value across the Teekay Group as laid out on this summary slide. We also continue to focus on further simplification of the group, which includes the ultimate divestment of our 3 FPSOs as well as a potential IDR monetization. In closing, I would like to thank all my colleagues at Sea and Shaw who have worked tirelessly to put the Teekay Group in a significantly stronger position as we enter into a new decade.
With that, operator, we are now available to take questions.
Thank At this time, we have no questions in queue.
Well, we look forward to reporting our business results in our 2 daughter companies right after this call and reporting back to you on our group progress next quarter. Thank you for listening in this morning.
Thank you. This concludes today's call. We appreciate your participation. You may now disconnect.