This Annual Report on Form 20-F for the year ended December 31, 2023 (this “Annual Report”) contains certain forward-looking statements concerning plans and objectives of management for future operations or economic performance, or assumptions related thereto, including our financial forecast. In addition, we and our representatives may from time to time make other oral or written statements that are also forward-looking statements. Such statements include, in particular, statements about our plans, strategies, business prospects, changes and trends in our business, and the markets in which we operate as described in this Annual Report. In some cases, you can identify the forward-looking statements by the use of words such as “may,” “could,” “should,” “would,” “expect,” “plan,” “anticipate,” “intend,” “forecast,” “believe,” “estimate,” “predict,” “propose,” “potential,” “continue” or the negative of these terms or other comparable terminology. These forward-looking statements reflect management’s current views only as of the date of this Annual Report and are not intended to give any assurance as to future results. As a result, unitholders are cautioned not to rely on any forward-looking statements.
Forward-looking statements appear in a number of places in this Annual Report and 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 and conventional tankers; |
| ● | market trends in the production of oil in the North Sea, Brazil and elsewhere; |
| ● | the ability of Knutsen NYK Offshore Tankers AS (“KNOT”) and KNOT Offshore Partners LP (“KNOT Offshore Partners”) to build shuttle tankers and the timing of the delivery and acceptance of any such vessels by their respective charterers; |
| ● | KNOT Offshore Partners’ ability to purchase vessels from KNOT in the future; |
| ● | KNOT Offshore Partners’ ability to enter into long-term charters, which KNOT Offshore Partners defines as charters of five years or more, or shorter term charters or voyage contracts; |
| ● | KNOT Offshore Partners’ ability to refinance its indebtedness on acceptable terms and on a timely basis and to make additional borrowings and to access debt and equity markets; |
| ● | KNOT Offshore Partners’ distribution policy, forecasts of KNOT Offshore Partners’ ability to make distributions on its common units, Class B Units representing limited partner interests (“Class B Units”) and Series A Convertible Preferred Units (“Series A Preferred Units”), the amount of any such distributions and any changes in such distributions; |
| ● | KNOT Offshore Partners’ ability to integrate and realize the expected benefits from acquisitions; |
| ● | impacts of supply chain disruptions and the resulting inflationary environment; |
| ● | KNOT Offshore Partners’ anticipated growth strategies; |
| ● | the effects of a worldwide or regional economic slowdown; |
| ● | turmoil in the global financial markets; |
| ● | fluctuations in currencies, inflation 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; |
| ● | recoveries under KNOT Offshore Partners’ insurance policies; |
| ● | the length and cost of drydocking; |
| ● | 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; |
| ● | 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 KNOT’s relationships and reputation in the shipping industry; |
| ● | KNOT Offshore Partners’ ability to maximize the use of its vessels, including the re-deployment or disposition of vessels no longer under 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 impacts of the Russian war with Ukraine, the conflict between Israel and Hamas and the other conflicts in the Middle East; |
| ● | the expected cost of, and KNOT Offshore Partners’ ability to, comply with governmental regulations (including climate change regulations) and 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; |
| ● | the effects of outbreaks of pandemics or contagious diseases, including the impact on KNOT Offshore Partners’ business, cash flows and operations as well as the business and operations of its customers, suppliers and lenders; |
| ● | the impact of cybercrime; |
| ● | 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 its unitholders; |
| ● | estimated future capital expenditures; |
| ● | Marshall Islands economic substance requirements; |
| ● | KNOT Offshore Partners’ ability to retain key employees; |
| ● | customers’ increasing emphasis on climate, 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; and |
| ● | KNOT Offshore Partners’ business strategy and other plans and objectives for future operations. |
Forward-looking statements in this Annual Report are made based upon management’s current plans, expectations, estimates, assumptions and beliefs concerning future events impacting us and therefore involve a number of risks and uncertainties, including those risks discussed in “Item 3. Key Information—Risk Factors.” The risks, uncertainties and assumptions involve known and unknown risks and are inherently subject to significant uncertainties and contingencies, many of which are beyond KNOT Offshore Partners’ control. KNOT Offshore Partners cautions that forward-looking statements are not guarantees and that actual results could differ materially from those expressed or implied in the forward-looking statements.
KNOT Offshore Partners undertakes no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible 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 makes no prediction or statement about the performance of its common units. The various disclosures included in this Annual Report and in KNOT Offshore Partners’ other filings made with the Securities and Exchange Commission (the “SEC”) that attempt to advise interested parties of the risks and factors that may affect KNOT Offshore Partners’ business, prospects and results of operations should be carefully reviewed and considered.
