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Renewable Energy Company Alterra Power Announces Results for the Quarter Ended June 30, 2016
Thursday, September 15, 2016Company Profile | Follow Company
(under IFRS and all amounts in US dollars unless otherwise stated)
Vancouver, BC, September 15, 2016--(T-Net)--Renewable Energy Company Alterra Power Corp. (TSX: AXY) reported its financial and operating results for the three and six months ended June 30, 2016. For further information on these results please see Alterra's Condensed Consolidated Interim Financial Statements and Management's Discussion and Analysis.
At June 30, 2016, Alterra consolidated 100% of the results of operations from its Icelandic subsidiary HS Orka, while Alterra's interests in the Toba Montrose, Dokie 1 and Shannon renewable power projects were accounted for as equity investments.
In certain statements in this news release, Alterra's results are disclosed as Alterra's "net interest", by which the Company means the effective portion of operating results that the Company would have reported if each of HS Orka (66.6%), Toba Montrose (40%), Dokie 1 (25.5%), and Shannon (50% sponsor equity interest) had been reported in accordance with Alterra's actual share of ownership at June 30, 2016 and for the three and six months then ended.
Management believes that net interest reporting provides the clearest view of Alterra's performance.
Highlights for the quarter and subsequent period include:
Financial Results
The following table shows Alterra's net interest in select operating and financial results for the quarter, in addition to key financial information extracted from the consolidated results.
For the three months ended |
HS Orka |
Toba Montrose |
Dokie 1 |
Shannon |
Development and Head Office |
Net Interest Total |
Consolidated Results |
June 30, 2016(a) |
(66.6%) |
(40%) |
(25.5%) |
(50%) |
|||
Generation (MWh) |
184,011 |
110,014 |
16,841 |
76,205 |
— |
387,071 |
276,293 |
Total revenue |
9,189 |
6,900 |
1,368 |
1,088 |
— |
18,545 |
13,797 |
Gross profit (loss) |
2,392 |
5,028 |
466 |
(1,111) |
— |
6,775 |
3,591 |
Adjusted EBITDA(b) |
4,465 |
5,550 |
807 |
(67) |
(2,228) |
8,527 |
10,765 |
For the three months ended |
HS Orka |
Toba Montrose |
Dokie 1 |
Development and Head Office |
Net Interest Total |
Consolidated Results |
|
June 30, 2015 |
(66.6%) |
(40%) |
(25.5%) |
||||
Generation (MWh) |
204,814 |
108,051 |
15,700 |
— |
328,565 |
307,529 |
|
Total revenue |
9,005 |
7,398 |
1,258 |
— |
17,661 |
13,522 |
|
Gross profit |
2,588 |
5,498 |
298 |
— |
8,384 |
3,887 |
|
Adjusted EBITDA(b) |
4,378 |
6,011 |
650 |
(1,554) |
9,485 |
11,679 |
|
(a) |
Here and elsewhere, all tabular amounts (except generation) are expressed in thousands of US dollars. |
(b) |
Here and elsewhere, adjusted EBITDA ("Adjusted EBITDA") is defined by the Company as earnings before interest, taxes, foreign exchange, depreciation and amortization, as well as adjustments for changes in the fair value of holding company bonds (Sweden) and derivatives, write-offs of development costs, other income (expense) except business interruption insurance proceeds, amortization of below market contracts, value assigned to options granted, share of results of equity investments, the Company's proportionate interest in Adjusted EBITDA of its equity investments, research and development costs for deep drilling program and non-recurring items (insurance deductibles, litigation and arbitration costs). Adjusted EBITDA has been calculated on a consistent basis with the comparative quarter. |
Consolidated Results
Revenue was $13.8 million for the quarter, up 2% from the comparative quarter primarily due to the strengthening of the Icelandic Krona.
The Company recorded net income of $3.4 million, down from the comparative quarter ($6.8 million), resulting primarily from changes in non-cash items such as the change in fair value of holding company bonds (Sweden).
Consolidated cash and cash equivalents at June 30, 2016 was $11.7 million of which $9.1 million is held in the Company's Icelandic subsidiary ($10.3 million and $6.4 million respectively at December 31, 2015).
The Company's consolidated working capital deficit at June 30, 2016 was $153.2 million compared to a working capital deficit of $123.3 million at December 31, 2015. The working capital deficit is primarily due to the fair value of the holding company bonds (Sweden) being classified as short-term (the bonds mature within twelve months).
Net Interest Results
Alterra's net interest revenue increased by $0.9 million to $18.5 million primarily due to increased generation at Dokie 1, generation from Shannon and the strengthening of the Icelandic Krona. Net interest EBITDA decreased 10% to $8.5 million due to development spend on early-stage projects along with the weakening of the Canadian dollar.
The net interest cash position at June 30, 2016 was $14.8 million.
Operating Results
The Company achieved 94.3% of its budgeted generation for the quarter, led by Toba Montrose.
Q2 2016 Generation (MWh) |
||||||||||
Total |
Net Interest |
|||||||||
Facility |
Budget (a) |
Actual |
Budget (a) |
Actual |
% of Budget |
|||||
Reykjanes |
148,840 |
144,378 |
99,127 |
96,156 |
97.0% |
|||||
Svartsengi |
134,645 |
131,915 |
89,674 |
87,855 |
98.0% |
|||||
Toba Montrose |
226,971 |
275,034 |
90,788 |
110,014 |
121.2% |
|||||
Dokie 1 |
68,131 |
66,043 |
17,373 |
16,841 |
96.9% |
|||||
Shannon |
226,698 |
152,410 |
113,349 |
76,205 |
67.2% |
|||||
TOTAL |
805,285 |
769,780 |
410,311 |
387,071 |
94.3% |
(a) Includes planned maintenance outages.
"We are pleased with the continued solid performance of our operating assets in the quarter as well as the recent achievement of commercial operations at Jimmie Creek," said Lynda Freeman, CFO of Alterra. "We are now fully geared towards our next phase of growth with the advancement of Flat Top as well as a solar development portfolio and other development projects."
About Alterra Power Corp.
Alterra Power Corp. is a leading global renewable energy company, operating seven power plants totaling 819 MW of generation capacity including British Columbia's largest run-of-river hydro facility and largest wind farm, the recently completed Shannon and Jimmie Creek projects, and two geothermal facilities in Iceland. Alterra owns a 381 MW share of this capacity, generating over 1,700 GWh of clean power annually. Alterra also has an extensive portfolio of exploration and development projects and a skilled team of developers, builders and operators to support its growth plans.
Cautionary Note Regarding Forward-Looking Statements and Information
Certain of the statements and information included in this news release constitute forward-looking statements and information within the meaning of applicable securities laws. All statements, other than statements of historical fact, are forward-looking statements or information. This information may involve known and unknown risks, assumptions and uncertainties, and other factors which may cause the Company's actual results, performance or achievements to be materially different from the future results, performance or achievements implied by such statements or information. Specifically, forward-looking statements within this news release relate to, among other things: success of the deep drilling program at Reykjanes, successful development and construction of our pre-operational projects and properties, including Flat Top and our solar development portfolio, and the timing of the same, marketing of power and ability to secure power purchase or offtake agreements in respect of the same; success, timing and receipt of future payments and financial milestones, our ability to successfully refinance certain bonds, results of operations, and financial position.
These statements and information reflect the Company's current views with respect to future events and are necessarily based upon a number of assumptions that, while considered reasonable by the Company, are inherently subject to significant operational, business, economic and regulatory uncertainties and contingencies. These assumptions include, among others, the expected power generation from our operations, the success and timely completion of planned development, expansion and construction programs, and modeling and budgeting based on historical trends, our ability or inability to obtain financing or refinancing to pursue our growth strategy and business plans, current conditions and expected future developments.
Forward-looking statements and information also involve known and unknown risks that may cause actual results to differ materially from those expressed by such statements or information, and the Company has made assumptions and estimates based on or related to many of these factors. These risks include volatility of renewable energy resources, inherent risks in operating and constructing power plants and development programs related to the same, contractual risks related to credit facilities, partnership and power purchase agreements, prospective power, currency and commodity price fluctuations, health, safety, social and environmental risks and risks related to reliance on third parties.
Additional risks, assumptions and influential factors are set out in the Company's management discussion analysis and Alterra's most recent annual information form, copies of which are available on SEDAR at www.sedar.com.
Although the Company has attempted to identify important factors that could cause actual results to differ materially, given the inherent uncertainties in such forward-looking statements and information, there may be other factors that cause results not to be as anticipated, estimated, described or intended. Investors are cautioned against undue reliance on any such forward-looking statements or information, which apply only as of their dates. Other than as specifically required by law, Alterra undertakes no obligation to update any forward-looking statements or information to reflect new information.
Contact:
Peter Lekich, Corporate Communications, Alterra Power Corp., Phone: 604.235.6719, Email: info@alterrapower.ca