PR Newswire
VANCOUVER, Nov. 8, 2016
(under IFRS and all amounts in US dollars unless otherwise stated)
VANCOUVER, Nov. 8, 2016 /PRNewswire/ - Alterra Power Corp. (TSX: AXY) ("Alterra" or the "Company") is pleased to report its financial and operating results for the three and nine months ended September 30, 2016. For further information on these results please see Alterra's Condensed Consolidated Interim Financial Statements and Management's Discussion and Analysis ("MD&A").
At September 30, 2016, Alterra consolidated 100% of the results of operations from its Icelandic subsidiary HS Orka, while Alterra's interests in the Toba Montrose, Jimmie Creek, 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%), Jimmie Creek (51%), Dokie 1 (25.5%), and Shannon (50% sponsor equity interest) had been reported in accordance with Alterra's actual share of ownership at September 30, 2016 and for the three and nine months then ended. Management believes that net interest reporting, although a non-IFRS measure, provides the clearest view of Alterra's performance. Refer to our MD&A for further information on non-IFRS measures.
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 September 30, 2016 (a) |
HS Orka |
Toba |
Jimmie |
Dokie 1 |
Shannon |
Development |
Net |
Consolidated |
(66.6%) |
(40%) |
(51%) |
(25.5%) |
(50%) | ||||
Generation (MWh) |
180,159 |
140,170 |
33,043 |
15,441 |
72,212 |
— |
441,025 |
270,509 |
Total revenue |
9,391 |
11,852 |
3,897 |
1,337 |
1,628 |
— |
28,105 |
14,100 |
Gross profit (loss) |
1,516 |
9,693 |
3,388 |
472 |
(636) |
— |
14,433 |
2,323 |
Adjusted EBITDA (b) |
4,693 |
10,266 |
3,580 |
765 |
190 |
(483) |
19,011 |
21,367 |
For the three months ended September 30, 2015 |
HS Orka |
Toba |
Dokie 1 |
Development |
Net |
Consolidated |
(66.6%) |
(40%) |
(25.5%) | ||||
Generation (MWh) |
191,992 |
149,927 |
19,981 |
— |
361,900 |
288,275 |
Total revenue |
8,147 |
12,422 |
1,696 |
— |
22,265 |
12,232 |
Gross profit |
1,911 |
10,098 |
854 |
— |
12,863 |
2,870 |
Adjusted EBITDA (b) |
4,680 |
10,617 |
1,193 |
(1,121) |
15,369 |
17,718 |
(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. The Company discloses Adjusted EBITDA as it is a measure used by analysts and by management to evaluate the Company's performance. As Adjusted EBITDA is a non-IFRS measure, it may not be comparable to Adjusted EBITDA calculated by others. In addition, Adjusted EBITDA is not a substitute for net earnings. Readers should consider net earnings in evaluating the Company's performance. For a reconciliation of consolidated Adjusted EBITDA to Alterra's condensed consolidated interim financial statements refer to the Company's Management's Discussion and Analysis for the three and nine months ended September 30, 2016 available on SEDAR at www.sedar.com. |
Consolidated Results
Revenue was $14.1 million for the quarter, up 15% from the comparative quarter predominantly due to the strengthening of the Icelandic Krona.
The Company recorded net income of $10.4 million, up from the comparative quarter ($2.3 million), primarily due to changes in non-cash items such as the share of results of equity investments, change in the fair value of the holding company bonds (Sweden) and embedded derivatives as well as foreign exchange.
Consolidated cash and cash equivalents at September 30, 2016 was $6.8 million of which $4.3 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 September 30, 2016 was $165.3 million compared to a working capital deficit of $123.3 million at December 31, 2015. The working capital deficit was primarily due to the fair value of the holding company bonds (Sweden) being classified as short-term (the bonds were all set to mature within twelve months). Had the OR bond refinancing been completed at September 30, 2016, the working capital deficit would have been reduced to approximately $92.4 million.
Net Interest Results
Alterra's net interest revenue increased by $5.8 million to $28.1 million primarily due to generation from Shannon and Jimmie Creek, and the strengthening of the Icelandic Krona. Net interest Adjusted EBITDA increased 24% to $19.0 million primarily due to generation from Shannon and Jimmie Creek which were not operational in the comparative quarter.
The net interest cash position at September 30, 2016 was $15.0 million.
Operating Results
The Company achieved 91.9% of its budgeted generation for the quarter, led by Toba Montrose.
Q3 2016 Generation (MWh) |
|||||||||
Total |
Net Interest |
||||||||
Facility |
Budget (a) |
Actual |
Budget (a) |
Actual |
% of Budget | ||||
Reykjanes |
168,920 |
144,409 |
112,501 |
96,176 |
85.5% | ||||
Svartsengi |
133,500 |
126,100 |
88,911 |
83,983 |
94.5% | ||||
Toba Montrose |
377,862 |
350,426 |
151,145 |
140,170 |
92.7% | ||||
Jimmie Creek (b) |
61,136 |
64,790 |
31,179 |
33,043 |
106.0% | ||||
Dokie 1 |
71,909 |
60,553 |
18,337 |
15,441 |
84.2% | ||||
Shannon |
155,736 |
144,423 |
77,868 |
72,212 |
92.7% | ||||
TOTAL |
969,063 |
890,701 |
479,941 |
441,025 |
91.9% |
(a) Includes planned maintenance outages. |
(b) Measured from commencement of operations on August 1, 2016 |
"With the inclusion of Jimmie Creek and Shannon, we have increased our operating capacity by 48%," said Lynda Freeman, CFO of Alterra. "We are looking forward to the next phase of growth, and through the successful completion of our equity raise in October, Alterra is well positioned to further advance Flat Top and our other development assets".
Alterra will host a conference call to discuss financial and operating results on Wednesday, November 9, 2016 at 11:30 am ET (8:30 am PT). |
North American participants dial 1-888-390-0546 and International participants dial 1-416-764-8688; the conference ID is 83023975 The call will also be broadcast live on the Internet at http://event.on24.com/r.htm?e="1300851"&s="1"&k="979"B89875BB74AE61E1AA1CC9985F641 |
The call will be available for replay for one week after the call by dialing 1-416-764-8677 and entering replay PIN 023975# |
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, financing, and construction of our pre-operational projects and properties, including Flat Top and our solar development portfolio, and the timing of the same, successful completion of financing, turbine supply, offtake and other material components of the development of the Flat Top project, the use of proceeds from the Company's recent equity financings, 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, and plans or expectations for the declaration of future dividends.
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, project operating risks, availability of future cash flows, ability to meet corporate law requirements and board approval of, future dividends, 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, availability of capital and future cash flows, project operating risks, the Company's future growth plans. 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.
SOURCE Alterra Power Corp.