MONTREAL, Feb. 25 /CNW Telbec/ - Boralex Inc. ("Boralex" or the "Corporation") ended fiscal 2009 with a solid performance despite a difficult economic context.
(in millions of dollars, except per share data)
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Three-month Twelve-month
periods ended periods ended
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December 31, December 31, December 31, December 31,
2009 2008 2009 2008
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Revenues from energy
sales 46.1 54.3 184.8 197.2
EBITDA 12.0 15.6 57.3 68.8
Net earnings 14.7 4.4 24.4 20.4
per share (basic
and diluted) $0.39 $0.12 $0.65 $0.54
Cash flows from
operations 11.3 11.1 47.4 55.2
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Boralex ended fiscal 2009 with total revenues from energy sales of $184.8 million, down 6.3% compared to $197.2 million in 2008. Earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to $57.3 million versus $68.8 million a year earlier. The decrease in operating results is largely due to lower electricity prices for power generated by the hydroelectric and thermal power stations in the United States, lower REC sales, and the performance of the Boralex Power Income Fund ("Fund") and the problems experienced at its Dolbeau power station. In that regard, the Fund depreciated Dolbeau's tangible assets by close to 50%, which had a $5.6 million impact on Boralex's EBITDA. Furthermore, following the 16% interest in the Corporation's European assets acquired by the strategic partner, Cube Infrastructure Fund ("Cube"), in the fourth quarter of 2009, Boralex registered a gain on dilution of $13.9 million. This operation demonstrates the Corporation's ability to create value for its shareholders and the very high quality of the European assets. The Corporation ended fiscal 2009 with net earnings of $24.4 million or $0.65 per share (basic and diluted), up $4.0 million over 2008.
Revenues in the wind power segment increased 11.1% over 2008 to $33.9 million in 2009. EBITDA also rose 11.7%, to $26.8 million in 2009. These increases are mainly related to the startup of the first two wind farms in Phase I at Thames River in Ontario, to the increased production at existing sites due to more favourable wind conditions, and also to the higher availability rates of the turbines.
The hydroelectric power stations reported revenues of $10.3 million and EBITDA of $5.5 million, down $1.5 million and $2.4 million respectively compared to fiscal 2008. These results stem from lower electricity prices (in $US) on the open electricity market in New York State, resulting from the economic slowdown and lower natural gas prices. However, the contribution of the new Ocean Falls power station in British Columbia partially offset the impact of the lower prices.
The wood-residue segment recorded revenues of $123.4 million, down 9.2% from revenues in 2008. This decrease stemmed in part from lower REC sales and lower electricity prices. However, these items had only a slight impact on EBITDA, which amounted to $40.0 million versus $40.5 million in 2008. This segment also benefited in 2009 from a number of positive factors, including lower fuel supply and maintenance costs, as well as the drop in the value of the Canadian dollar, primarily in the first three quarters.
The profitability of the natural gas plant was comparable to that of 2008 with EBITDA of $2.2 million in 2009 versus $2.3 million in 2008. Revenues were down $1.9 million to $17.2 million in 2009. The significant drop in the price of natural gas, which had a domino effect on electricity and steam prices, was offset by lower fuel supply costs.
In the fourth quarter 2009, revenues generated by energy sales totalled $46.1 million, down $8.2 million from the same period in 2008. EBITDA amounts to $12.0 million, or $17.6 million excluding the impairment of the Fund's tangible assets. Excluding this specific item, EBITDA rose 12.8% over the same quarter in 2008. The increase stems from higher power generation in the wind power segment and the contribution of the Ocean Falls power station, but was partially offset by lower electricity prices and lower REC sales. The recognition of a gain on dilution of $13.9 million, a result of the participation of the strategic partner in Europe, led to net earnings in the fourth quarter of $14.7 million ($0.39 per share) compared to $4.4 million ($0.12 per share) for the same quarter in 2008.
Patrick Lemaire, President and Chief Executive Officer of Boralex Inc. noted that "in 2009 we maintained significant cash flows, even during the recession. Our Corporation met its goals of ensuring prudent management of its investments and capital structure in the economic context that has prevailed since the Fall of 2008. We ended fiscal 2009 with a number of acquisitions that represent more than 75 MW and we hope, for 2010, to continue our efforts to find new business opportunities, obtain financing and develop quality projects."
About Boralex
Boralex is a major independent power producer whose core business is the development and operation of power stations that generate renewable energy.
Employing over 300 people, the Corporation operates 29 power stations with a total installed capacity of 417 megawatts ("MW") in Canada, in the Northeastern United States and in France. In addition, the Corporation has, alone or with its European and Canadian partners, power projects under development that will add close to 300 MW of power, of which almost 100 MW will come online by the end of fiscal 2010. Boralex is distinguished by its diversified expertise and in-depth experience in three power generation segments - wind, hydroelectric and thermal.
Boralex also holds a 23% interest in Boralex Power Income Fund, which has 10 power stations with a total installed capacity of 190 MW in Québec and the United States. These sites are managed by Boralex.
Boralex shares are listed on the Toronto Stock Exchange (TSX) under the ticker symbol BLX.
More information is available at www.boralex.com or www.sedar.com.
Certain statements contained in this press release, including those regarding future results and performance, are forward-looking statements based on current expectations. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those projected, including, but not limited to, the general impact of economic conditions, raw material price increases and availability, currency fluctuations, fluctuations in electricity selling prices, the Company's financing capacity, adverse changes in general market and industry conditions, as well as other factors listed in the Company's filings with different securities commissions.
The summarized financial statements included in this press release also contain certain financial measurements that are not recognized as Generally Accepted Accounting Principles of Canada (GAAP). To assess the operating performance of its assets and reporting segments, the Corporation uses earnings before interest, taxes, depreciation and amortization (EBITDA) and cash flows from operations as performance measurements. These measures are not defined under GAAP and do not have a standardized definition prescribed by GAAP. Therefore, they may not be comparable to similar measures presented by other companies. EBITDA is defined in the summarized financial statements included with this press release. Cash flows from operations corresponds to cash flows from operating activities before changes in non-cash working capital items as disclosed in the consolidated statements of cash flows attached in this press release.
Notice to shareholders
The interim consolidated financial statements as at December 31, 2009 and 2008 have not been reviewed by our auditors PricewaterhouseCoopers LLP. The financial statements are the responsability of the management of Boralex Inc. and have been reviewed and approved by the Board of Directors, on the recommandation of its Audit Committee.
The following financial information was extracted from the annual consolidated financial statements of Boralex Inc. (the "Corporation"). The complete annual consolidated financial statements were prepared in accordance with Canadian generally accepted accounting principles.
Consolidated Balance Sheets
As at As at
December 31, December 31,
(in thousands of dollars) (unaudited) 2009 2008
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(Restated)
Assets
Current assets
Cash and cash equivalents 37,821 69,195
Accounts receivable 39,632 48,812
Future income taxes 422 238
Inventories 8,726 8,833
Prepaid expenses 2,537 2,106
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89,138 129,184
Investment 55,446 69,348
Property, plant and equipment 413,539 330,443
Electricity sales contracts 49,023 26,402
Other assets 56,621 67,577
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663,767 622,954
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Liabilities
Current liabilities
Bank loans and advances 12,291 -
Accounts payable and accrued liabilities 28,913 22,113
Income taxes 283 1,716
Other liabilities - 5,718
Current portion of long-term debt 33,273 29,410
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74,760 58,957
Long-term debt 197,116 158,035
Future income taxes 37,185 39,437
Fair value of derivative financial instruments 7,645 3,000
Non-controlling interests 7,031 805
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323,737 260,234
Shareholders' equity
Capital stock 222,694 222,694
Contributed surplus 4,295 3,069
Retained earnings 159,900 135,461
Accumulated other comprehensive income (loss) (46,859) 1,496
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340,030 362,720
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663,767 622,954
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Consolidated Statements of Earnings
(in thousands of
dollars, except
per share amounts For the For the
and number of three-month periods twelve-month periods
shares) ended December 31, ended December 31,
(unaudited) 2009 2008 2009 2008
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(Restated) (Restated)
Revenues from energy
sales 46,149 54,316 184,779 197,246
Renewable energy tax
credits 3,404 3,400 13,853 12,463
Operating costs 29,093 41,683 126,286 138,400
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20,460 16,033 72,346 71,309
Share in earnings of
the Fund (5,088) 1,607 (2,090) 7,826
Management revenue
from the Fund 1,789 1,352 5,876 5,395
Other revenue 286 1,691 2,061 2,849
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17,447 20,683 78,193 87,379
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Other expenses
Management and
operation of the
Fund 1,348 1,014 4,789 4,065
Administration costs 4,114 4,065 16,079 14,479
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5,462 5,079 20,868 18,544
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Operating earnings
before amortization 11,985 15,604 57,325 68,835
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Amortization 6,675 6,288 26,056 24,438
Foreign exchange
loss (gain) 1,271 (834) 1,473 (1,437)
Net loss on
financial instruments 929 49 923 143
Financing costs 3,497 3,836 13,727 13,806
Gain on dilution (13,865) - (13,865) -
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(1,493) 9,339 28,314 36,950
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Earnings before income
taxes 13,478 6,265 29,011 31,885
Income taxes (recovery) (1,280) 1,833 4,470 11,329
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14,758 4,432 24,541 20,556
Non-controlling
interests (46) (34) (102) (146)
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Net earnings 14,712 4,398 24,439 20,410
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Net earnings per
Class A share
(basic) (in
dollars) 0.39 0.12 0.65 0.54
Net earnings per
Class A share
(diluted) (in
dollars) 0.39 0.12 0.65 0.54
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Weighted average
number
of Class A shares
outstanding (basic) 37,740,921 37,740,921 37,740,921 37,739,840
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Consolidated Statements of Retained Earnings
For the
twelve-month periods
ended December 31,
(in thousands of dollars) (unaudited) 2009 2008
-------------------------------------------------------------------------
(Restated)
Balance - beginning of period 135,461 115,669
Application of Section 3064 - (336)
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Balance restated - beginning of period 135,461 115,333
Share redemption premium - (282)
Net earnings for the period 24,439 20,410
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Balance - end of period 159,900 135,461
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Consolidated Statements of Comprehensive Income (Loss)
For the For the
three-month periods twelve-month periods
(in thousands of ended December 31, ended December 31,
dollars) (unaudited) 2009 2008 2009 2008
-------------------------------------------------------------------------
(Restated) (Restated)
Net earnings for the
period 14,712 4,398 24,439 20,410
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Other comprehensive
income (loss)
Translation
adjustments
Unrealized foreign
exchange gain
(loss) on trans-
lation of finan-
cial statements
of self-sustaining
foreign operations (6,056) 30,528 (32,389) 40,994
Reclassification to
net earnings of a
realized foreign
exchange loss
(gain) related to
the reduction of
net investment in
self-sustaining
foreign operations 1,141 (1,285) 1,076 (1,285)
Share of cumulative
translation
adjustments of the
Fund (101) 3,429 (2,174) 4,297
Taxes 33 (784) 581 (1,012)
Cash flow hedges
Change in fair
value of financial
instruments 39 12,891 7,140 23,542
Hedging items
realized and
recognized in net
earnings (3,991) (6,655) (22,608) (5,485)
Hedging items
realized and
recognized in
balance sheet (271) - (3,884) (673)
Taxes 651 (893) 4,383 (4,460)
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(8,555) 37,231 (47,875) 55,918
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Comprehensive income
(loss) for the period 6,157 41,629 (23,436) 76,328
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Consolidated Statements of Cash Flows
For the For the
three-month periods twelve-month periods
(in thousands of ended December 31, ended December 31,
dollars) (unaudited) 2009 2008 2009 2008
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(Restated) (Restated)
Operating activities
Net earnings 14,712 4,398 24,439 20,410
Distributions received
from the Fund 2,409 2,409 9,638 10,326
Adjustments for non-cash
items
Net loss on
financial instruments 719 49 1,253 143
Share in earnings
of the Fund 5,088 (1,607) 2,090 (7,826)
Amortization 6,675 6,288 26,056 24,438
Amortization of
deferred financing
costs and monetization
program expenses 719 784 2,893 2,928
Renewable energy
tax credits (3,165) (1,588) (7,113) (4,583)
Gain on dilution (16,315) - (16,315) -
Future income taxes (51) 1,339 3,002 9,413
Other 539 (935) 1,470 (49)
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11,330 11,137 47,413 55,200
Change in non-cash
working capital
balances 13,259 6,287 13,373 (1,004)
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24,589 17,424 60,786 54,196
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Investing activities
Business acquisitions (47,283) - (53,758) (5,781)
Purchase of property,
plant and equipment (24,399) (11,293) (84,532) (44,577)
Change in debt
servicing reserves 150 49 (1,091) 21
Development projects (3,357) (517) (10,337) (5,617)
Other 671 (2,208) (6,366) (3,675)
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(74,218) (13,969) (156,084) (59,629)
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Financing activities
Increase (decrease)
in bank loans and
advances (925) (448) 12,291 -
Increase in long-term
debt 35,158 126 68,714 126
Payments on long-term
debt (6,788) (1,602) (27,539) (19,258)
Share repurchase - (665) - (859)
Net proceeds from
share issuance - - - 1,714
Change in non-
controlling interests 23,181 - 22,213 -
Other - 30 - 36
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50,626 (2,559) 75,679 (18,241)
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Translation adjustment
on cash
and cash equivalents (814) 9,588 (11,755) 13,674
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Net change in cash and
cash equivalents 183 10,484 (31,374) (10,000)
Cash and cash
equivalents -
beginning of period 37,638 58,711 69,195 79,195
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Cash and cash
equivalents - end of
period 37,821 69,195 37,821 69,195
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SUPPLEMENTAL
INFORMATION
Cash and cash
equivalents paid for:
Interests 2,526 2,543 9,130 9,816
Income taxes - 462 1,736 1,783
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Segmented Information
(tabular amounts in thousands of dollars, unless otherwise specified)
(unaudited)
The Corporation's power stations are grouped under four distinct segments: wind power, hydroelectric power, wood-residue thermal power and natural gas thermal power, and are engaged mainly in power generation. The classification of these segments is based on the different cost structures relating to each type of power stations.
The Corporation analyzes the performance of its operating segments based on the earnings before interest, taxes, depreciation and amortization ("EBITDA"). EBITDA is not a measure of performance under Canadian generally accepted accounting principles; however, management uses this performance measure to assess the operating performance of its segments. Earnings for each segment are presented on the same basis as those of the Corporation. In the consolidated statements of earnings, EBITDA is represented by Operating income before amortization.
The following table
reconciles EBITDA For the For the
with net earnings: three-month periods twelve-month periods
ended December 31, ended December 31,
2009 2008 2009 2008
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(Restated) (Restated)
Net earnings 14,712 4,398 24,439 20,410
Non-controlling
interests 46 34 102 146
Income taxes (recovery) (1,280) 1,833 4,470 11,329
Gain on dilution (13,865) - (13,865) -
Financing costs 3,497 3,836 13,727 13,806
Net loss on
financial instruments 929 49 923 143
Foreign exchange loss
(gain) 1,271 (834) 1,473 (1,437)
Amortization 6,675 6,288 26,056 24,438
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EBITDA 11,985 15,604 57,325 68,835
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Information by operating segment
For the For the
three-month periods twelve-month periods
ended December 31, ended December 31,
2009 2008 2009 2008
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(Restated) (Restated)
PRODUCTION (in MWh)
Wind farms 79,741 56,683 235,418 220,500
Hydroelectric power
stations 41,017 34,833 145,303 132,057
Wood-residue thermal
power stations 304,399 295,213 1,156,652 1,232,907
Natural gas thermal
power station 14,859 15,260 37,501 37,829
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440,016 401,989 1,574,874 1,623,293
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REVENUE FROM ENERGY SALES
Wind farms 10,974 7,942 33,872 30,543
Hydroelectric power
stations 2,948 2,844 10,329 11,753
Wood-residue thermal
power stations 27,031 37,040 123,391 135,897
Natural gas thermal
power station 5,196 6,490 17,187 19,053
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46,149 54,316 184,779 197,246
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EBITDA
Wind farms 9,085 6,059 26,789 23,967
Hydroelectric power
stations 1,743 1,647 5,538 7,919
Wood-residue thermal
power stations 9,359 9,064 39,995 40,488
Natural gas thermal
power station 915 1,378 2,155 2,338
Corporate and
eliminations (9,117) (2,544) (17,152) (5,877)
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11,985 15,604 57,325 68,835
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PURCHASE OF PROPERTY,
PLANT AND EQUIPMENT
Wind farms 22,884 9,352 76,761 31,485
Hydroelectric power
stations 153 33 1,184 89
Wood-residue thermal
power stations 670 1,291 4,851 8,527
Natural gas thermal
power station - 12 28 81
Corporate and
eliminations 692 605 1,708 4,395
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24,399 11,293 84,532 44,577
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As at As at
December 31, December 31,
2009 2008
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ASSETS (Restated)
Wind farms 363,644 242,944
Hydroelectric power stations 34,622 23,019
Wood-residue thermal power stations 138,014 183,881
Natural gas thermal power station 13,600 17,151
Corporate and eliminations 113,887 155,959
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663,767 622,954
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For further information: Ms. Sophie Paquet, Communications Advisor, Boralex Inc., (514) 985-1353, [email protected]
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