Teekay Offshore Partners L.P. (TOO) swung to a net profit for the quarter ended Mar. 31, 2017. The company has made a net profit of $18.89 million in the quarter, against a net loss of $4.41 million in the last year period. On an adjusted basis, net profit for the quarter was $15.16 million, when compared with $43.95 million in the last year period.

Revenue during the quarter dropped 9.97 percent to $276.14 million from $306.71 million in the previous year period. Gross margin for the quarter contracted 312 basis points over the previous year period to 90.90 percent. Total expenses were 78.11 percent of quarterly revenues, up from 71.21 percent for the same period last year. That has resulted in a contraction of 690 basis points in operating margin to 21.89 percent.

Operating income for the quarter was $60.46 million, compared with $88.30 million in the previous year period.

"The Partnership's first quarter of 2017 results were better than our expectations, driven mainly by higher cash flow generated by our shuttle tanker and FPSO fleets," commented Ingvild Sæther, president and chief executive officer of Teekay Offshore Group Ltd. "However, our results for the quarter continued to be impacted by the non-payment of charter hire on the Arendal Spirit UMS. We were recently notified by the charterer, Petrobras, of its termination of the charter contract on this unit. We are disputing the termination and are reviewing our legal options, while at the same time actively marketing the unit for alternative employment."

The company has spent $60.72 million cash to meet investing activities during the quarter as against cash inflow of $33.50 million in the last year period.

The company has spent $71.22 million cash to carry out financing activities during the quarter as against cash outgo of $81.67 million in the last year period.

Cash and cash equivalents stood at $193.42 million as on Mar. 31, 2017, down 42.39 percent or $142.33 million from $335.75 million on Mar. 31, 2016.