DEDHAM, Mass., March 7, 2016 /PRNewswire/ – Atlantic Power
Corporation (NYSE: AT) (TSX: ATP) ("Atlantic Power" or the
"Company") today released its results for the three and twelve
months ended December 31, 2015.
Progress on Key Initiatives
- Reduced debt by a total of $833
million in the past two years as a result of asset sales,
debt amortization and discretionary debt repurchases; lowered
annual interest expense by more than $65
million
- Reduced overhead costs from $54
million in 2013 to $32 million
in 2015; expect further reduction to $27
million in 2016 (cumulative expected reduction of 50% from
2013)
- Invested a total of $22 million
in attractive optimization projects from 2013 to 2015; realized
cash flow benefit of approximately $6
million in 2015; expect $10
million benefit in 2016
- In December, announced modification of the Morris energy
services agreement and 11-year extension to December 2034; changes expected to be modestly
accretive to Project Adjusted EBITDA
Recent Developments
- Implemented normal course issuer bid (NCIB) for up to 10% of
each of the Company's convertible debentures and common shares and
up to 5% of Atlantic Power Preferred Equity Ltd.'s preferred
shares, subject to limitations described in the Company's
December 22, 2015 press release
- Shareholder litigation in United
States and Ontario
dismissed without payments by the Company (December 2015); proposed action in Quebec expected to be resolved in a similar
manner
- In February 2016, Standard &
Poor's upgraded the Company's corporate credit rating to B+ from B;
Moody's had upgraded to B1 from B2 in October 2015; both agencies have "stable"
outlooks for the credit
- Common dividend eliminated as part of changes to overall
capital allocation strategy (February
2016)
- Management and directors purchased approximately 493,000 shares
in Q4 2015 at an average price of US$1.77 per share; for the year, management and
director purchases totaled approximately 1.05 million shares at an
average price of US$2.31
Full Year 2015 Financial Results
- Reported project loss of $(41)
million vs. project loss of $(39)
million in 2014; 2015 results include $128 million impairment of long-lived assets and
goodwill (results for both years exclude the Wind Projects, which
are included in discontinued operations)
- Achieved Project Adjusted EBITDA of $209
million vs. $229 million in
2014, in the upper half of the Company's 2015 guidance range of
$200 to $215 million (results exclude
Wind Projects)
- Reported (GAAP) Cash flows provided by operating activities of
$87 million vs. $65 million in 2014 (results include cash flows
from the Wind Projects)
- Generated Adjusted Cash Flows from Operating Activities of
$105 million vs. $92 million in 2014, at the upper end of the
Company's 2015 guidance range of $95 to $105
million (results exclude Wind Projects and debt redemption
costs)
- Achieved Adjusted Free Cash Flow of $2
million vs. approximately zero in 2014, in the lower end of
the Company's 2015 guidance range of $0 to
$10 million because of a delay in a $6 million reimbursement for a customer-owned
construction project that was received in February 2016 (results exclude Wind Projects and
debt redemption costs)
Q4 2015 Financial Results
- Recorded $128 million non-cash
impairment of long-lived assets and goodwill, primarily at
Williams Lake
- Project loss of $(104) million
vs. project income of $2 million in
Q4 2014; loss for the fourth quarter of 2015 is attributable to the
$128 million impairment charge
(results for both years exclude the Wind Projects)
- Project Adjusted EBITDA of $50
million vs. $57 million in Q4
2014 (results exclude Wind Projects)
- Reported (GAAP) Cash flows provided by operating activities of
$20 million vs. $19 million in Q4 2014 (results include Wind
Projects)
- Adjusted Cash flows from Operating Activities of $29 million vs. $18
million in Q4 2014 (excludes Wind)
- Adjusted Free Cash Flow of $9
million vs. $(1) million in Q4
2014 (results exclude Wind projects)
2016 Guidance
- Project Adjusted EBITDA of $200 to $220
million
- Atlantic Power Limited Partnership (APLP) Project Adjusted
EBITDA of $145 to $155 million
- Adjusted Cash Flows from Operating Activities of $110 to $130 million
- Adjusted Free Cash Flow of $20 to $40
million
"In 2015, we made further progress in strengthening our
financial position and reducing our risk profile. Over the
past two years, we have reduced our debt by $833 million, lowered our cash interest and
overhead costs by approximately half, and improved our debt
maturity profile. In the past five months, our credit ratings
have been upgraded by both Moody's and Standard & Poor's.
In December, the proposed shareholder actions in both the United States and Ontario were dismissed by the courts without
any payments by us," said James J. Moore,
Jr., President & CEO of Atlantic Power.
Mr. Moore continued, "We had success on other fronts as
well. Our projects performed well in 2015 and earned
substantially all of their capacity payments. We achieved
Project Adjusted EBITDA and cash flow in line with our
guidance. We continued to make attractive investments in our
own fleet, which are yielding cash returns of more than 20%.
We announced an 11-year extension of our energy services agreement
with the customer at our Morris project, and we continue to make
progress on other contract
extensions."
"Looking ahead, we remain focused on growing the intrinsic value
per share of the Company. The amount of our discretionary
cash flow after debt repayment is growing, and we see ample
opportunities to put this to work at good returns. As we
announced earlier this month, we have prioritized repurchases of
our debt and equity, which are currently trading at compelling
price-to-value levels. In addition, we see the potential for
additional attractive investments in our fleet, some of which are
linked to possible contract extensions," said Mr. Moore. "We
believe that both these uses of cash have considerably higher
risk-adjusted returns than those available externally at
present. Although primarily focused on organic growth
initiatives, management has considerable experience building other
IPP businesses and will continue to evaluate potential external
investments in a disciplined and opportunistic manner."
All amounts are in U.S. dollars and are approximate unless
otherwise indicated. Adjusted Cash Flows from Operating Activities,
Free Cash Flow, Adjusted Free Cash Flow, Cash Distributions from
Projects, Project Adjusted EBITDA and APLP Project Adjusted EBITDA
are not recognized measures under generally accepted accounting
principles in the United States
("GAAP") and do not have standardized meanings prescribed by GAAP;
therefore, these measures may not be comparable to similar measures
presented by other companies. Please see "Regulation G Disclosures"
on page 18 of this news release for an explanation and the GAAP
reconciliation of "Adjusted Cash Flows from Operating Activities",
"Free Cash Flow", "Adjusted Free Cash Flow", "Cash Distributions
from Projects" and "Project Adjusted EBITDA" as used in this news
release. The Company has not reconciled non-GAAP financial
measures relating to individual projects or the projects in
discontinued operations or the APLP projects to the directly
comparable GAAP measures due to the difficulty in making the
relevant adjustments on an individual project basis. The
Company has not provided a reconciliation of forward-looking
non-GAAP measures, due primarily to variability and difficulty in
making accurate forecasts and projections, as not all of the
information necessary for a quantitative reconciliation is
available to the Company without unreasonable efforts.
Atlantic Power
Corporation
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Table 1 – Selected
Results
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(in millions of
U.S. dollars, except as otherwise stated)
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Unaudited
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Three months ended
December 31
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Twelve months
ended December 31
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2015
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2014
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2015
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2014
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Excluding results
from discontinued operations(1)
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|
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|
|
|
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Project
revenue
|
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$98.4
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$119.9
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|
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$420.2
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$489.9
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Project income
(loss)
|
|
(104.3)
|
2.1
|
|
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(41.4)
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(38.9)
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Project Adjusted
EBITDA
|
|
50.4
|
56.9
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|
|
208.9
|
229.4
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Cash Distributions
from Projects
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46.0
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57.6
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|
|
192.3
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209.1
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Adjusted Cash Flows
from Operating Activities
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29.3
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17.9
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|
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105.3
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92.4
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Adjusted Free Cash
Flow
|
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9.2
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(1.4)
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|
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1.8
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(0.3)
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Aggregate power
generation (thousands of Net MWh)
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1,646.4
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1,592.1
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6,353.3
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6,398.9
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Weighted average
availability
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96.0%
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93.6%
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95.2%
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93.0%
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Including results
from discontinued operations (1)
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Cash flows from
operating activities
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$19.7
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$19.1
|
|
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$87.4
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$65.0
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Free Cash
Flow
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(0.4)
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(7.2)
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(19.8)
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(55.6)
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Results of
discontinued operations
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Project Adjusted
EBITDA
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$-
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$20.7
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$28.1
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$69.8
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Cash Distributions
from Projects
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-
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4.8
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|
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7.3
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39.4
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Cash flows from
operating activities (as reported)
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-
|
11.3
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|
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21.9
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48.3
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Cash flows from
operating activities (as adjusted) (2)
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(5.0)
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11.3
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|
|
15.7
|
48.3
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(1)
Canadian Hills, Meadow Creek, Goshen North, Idaho Wind and Rockland
(the "Wind Projects") were sold in June 2015 and are designated as
discontinued operations for the twelve months ended December 31,
2015 and 2014. Greeley was sold in March 2014 and is included
as a component of discontinued operations for the twelve months
ended December 31, 2014. The results of discontinued
operations are excluded from Project revenue, Project income,
Project Adjusted EBITDA, Cash Distributions from Projects, Adjusted
Cash Flows from Operating Activities and Adjusted Free Cash Flow as
presented in Table 1. The results for discontinued operations
have also been excluded from the aggregate power generation and
weighted average availability statistics shown in Table 1.
Under GAAP, the cash flows attributable to the Wind Projects and
Greeley are included in cash flows from operating activities as
shown on the Company's Consolidated Statement of Cash Flows;
therefore, the Company's calculation of Free Cash Flow shown on
Table 1 also includes cash flows from the Wind Projects and
Greeley. However, the inclusion of Greeley in 2014 had no
impact on cash flows from operating activities or Free Cash
Flow. Results of discontinued operations shown above are for
the Wind Projects, as Greeley had no impact on Project Adjusted
EBITDA, Cash Distributions from Projects or cash flows from
operating activities for the 2014 period in which it was included
in discontinued operations.
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(2)
Adjusted for cash tax payments associated with the sale of the Wind
Projects of $5.0M in the fourth quarter of 2015 and $6.3M for the
Full Year 2015.
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Note: Project
Adjusted EBITDA, Cash Distributions from Projects, Adjusted Cash
Flows from Operating Activities, Adjusted Free Cash Flow and Free
Cash Flow are not recognized measures under GAAP and do not have
any standardized meaning prescribed by GAAP; therefore, these
measures may not be comparable to similar measures presented by
other companies. Please refer to Tables 8 and 10 through 12 for
reconciliations of these non-GAAP measures to GAAP
measures.
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Operating Results
The discussion of operating results excludes the Wind
Projects, which were sold in June
2015 and are included in discontinued operations.
Three Months Ended December 31,
2015
Project availability was 96.0% in the fourth quarter of
2015, an increase from 93.6% in the year-ago period.
Increased availability at Koma Kulshan and Selkirk, both of which had maintenance outages
in the comparable 2014 period, was partially offset by lower
availability at Mamquam, which had a scheduled maintenance outage
that extended into the fourth quarter of 2015. (The 2015
availability figure excludes Tunis, which has been mothballed since
February 2015 following the
expiration of its Power Purchase Agreement, or PPA, in December 2014.)
Generation increased 3.4% in the fourth quarter of 2015
from the year-ago period, primarily due to Frederickson, which had
increased dispatch due to stronger demand and lower fuel gas
pricing as compared to 2014; Selkirk, which had a hedging agreement in
place for November 2015; Morris,
which experienced favorable PJM pricing as well as higher merchant
demand in the fourth quarter of 2015, and Naval Station, due to a
forced outage in the year-ago period. These increases were
partially offset by decreases at Tunis, due to the expiration of its PPA;
Manchief, due to reduced dispatch, and Mamquam, which had a
scheduled maintenance outage that extended into the fourth quarter
of 2015.
Twelve Months Ended December 31,
2015
Project availability increased to 95.2% in 2015 from
93.0% in 2014. Increased availability at Nipigon, Piedmont, Cadillac and Orlando, all of which had maintenance outages
in 2014, more than offset decreased availability at Mamquam,
Manchief and Naval Training Center, which had scheduled maintenance
outages in 2015. (The 2015 availability figure excludes
Tunis.)
Generation decreased by 0.7% in 2015 from 2014, primarily
due to a PPA expiration at Tunis
(December 2014); lower dispatch at
Manchief (demand), Chambers (unfavorable pricing), Mamquam
(scheduled maintenance outage and lower water flows), and Curtis
Palmer (lower water flows). These decreases were partially
offset by an increase at Frederickson due to higher dispatch and
increases at Nipigon (outage in
2014 and waste heat), Calstock
(waste heat) and Morris (favorable PJM pricing/increased merchant
demand).
Financial Results
In the second quarter of 2015, the Company revised its
reportable business segments as a result of recent significant
asset sales and in order to align with changes in management's
structure, resource allocation and performance assessment in making
decisions regarding the Company's operations. Results of the
Company's businesses are now reported in four segments: East
U.S., West U.S., Canada and
Un-allocated Corporate.
Table 2 provides a breakdown of project income and Project
Adjusted EBITDA by segment for the three and twelve months ended
December 31, 2015 as compared to the
same periods in 2014. The Company's Wind Projects were sold
in June 2015 and are included in
results of discontinued operations for the three and twelve-month
periods ended December 31, 2015 and
2014. Greeley was sold in March
2014 and is included as a component of discontinued
operations for the twelve months ended December 31, 2014. Results for project
income and Project Adjusted EBITDA exclude discontinued
operations. Accordingly, results of the Wind Projects and
Greeley are not included in Project income or Project Adjusted
EBITDA for either the 2015 or 2014 periods shown in Table
2.
Atlantic Power
Corporation
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Table 2 – Segment
Results
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(in millions of
U.S. dollars, except as otherwise stated)
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Unaudited
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Three months ended
December 31
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Twelve months
ended December 31
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2015
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2014
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2015
|
2014
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Project income
(loss)
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East U.S.
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$12.4
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$3.9
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$52.4
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$8.7
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West U.S.
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0.3
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(0.5)
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7.6
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(27.6)
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Canada
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(117.3)
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1.3
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(99.4)
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(10.5)
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Un-allocated
Corporate
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0.3
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(2.6)
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(2.0)
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(9.5)
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Total
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(104.3)
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2.1
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(41.4)
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(38.9)
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Project Adjusted
EBITDA
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East U.S.
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$23.8
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$24.1
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$104.8
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$106.4
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West U.S.
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9.8
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9.4
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46.9
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54.2
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Canada
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16.7
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24.7
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59.7
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76.3
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Un-allocated
Corporate
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0.1
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(1.3)
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(2.5)
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(7.5)
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Total
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50.4
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56.9
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|
208.9
|
229.4
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The results of the
Wind Projects and Greeley, which are components of discontinued
operations, are excluded from Project income and Project Adjusted
EBITDA as presented in Table 2.
|
Note: Project
Adjusted EBITDA is not a recognized measure under GAAP and does not
have any standardized meaning prescribed by GAAP; therefore, this
measure may not be comparable to similar measures presented by
other companies. Please refer to Tables 8 and 10 through 12 for a
reconciliation of this non-GAAP measure to a GAAP measure.
The Company has not reconciled this non-GAAP financial measure
relating to individual project segments to the directly comparable
GAAP measure due to the difficulty in making the relevant
adjustments on a segment basis.
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Three Months Ended December 31,
2015
Project income (loss) can fluctuate significantly due to
non-cash adjustments to "mark-to-market" the fair value of
derivatives. Non-cash goodwill impairment charges and gains
or losses on the sale of assets are included in project income and
can also affect year-over-year comparisons. None of these
items are included in Project Adjusted EBITDA.
In the fourth quarter of 2015, the Company reported a project
loss of $(104.3) million as compared
to project income of $2.1 million in
the year-ago period. Results for the fourth quarter of 2015
included a non-cash impairment charge of $127.8 million. Included in this charge
were impairments of property, plant and equipment at Williams Lake and Calstock of $74.1
million and $2.5 million,
respectively. The Company also recorded full impairments of
the remaining goodwill at Williams
Lake and Calstock of
$35.6 million and $1.9 million, respectively, and a partial
goodwill impairment of $13.7 million
at Curtis Palmer. No impairment charges were recorded in the
fourth quarter of 2014. Results for the fourth quarter of
2015 also included a $23.2 million
mark-to-market increase in the fair value of derivatives as
compared to the fourth quarter of 2014.
Project Adjusted EBITDA includes the proportional share
of Project Adjusted EBITDA from the Company's equity method
projects. Project Adjusted EBITDA is a non-GAAP
measure. Table 8 of this press release provides a
reconciliation of Project Adjusted EBITDA to Project
income.
Project Adjusted EBITDA decreased $6.5
million to $50.4 million in
the fourth quarter of 2015 from $56.9
million in the fourth quarter of 2014. The most
significant drivers of lower EBITDA were the Tunis PPA expiration,
lower water flows at Mamquam, lower excess energy margins at
Chambers and lower electric revenue at Williams Lake. These
factors were partially offset by higher Project Adjusted EBITDA at
Curtis Palmer, which benefited from higher water flows, and
Selkirk, which realized lower fuel
costs. In addition, the Un-allocated Corporate segment
improved by $1.4 million in the
fourth quarter of 2015 from the year-ago period, primarily due to
$1.2 million of lower project-level
compensation expense. Currency had an approximate
$(3.0) million impact on Project
Adjusted EBITDA, with an average U.S. dollar to Canadian dollar
exchange rate for the fourth quarter of 2015 of 1.34 versus 1.14
for the year-ago period. However, from an overall cash
standpoint, that impact was mostly offset by the benefit of the
stronger U.S. dollar on the Company's Canadian-denominated interest
and dividend payments.
Corporate-level G&A expense (shown as
"Administration" on the Consolidated Statements of Operations)
decreased $4.8 million to
$6.4 million in the fourth quarter of
2015 from $11.2 million a year
ago. The improvement was due primarily to a $1.4 million decrease in legal expenses
associated with the U.S. and Canadian shareholder actions,
$0.6 million of reduced employee
compensation expenses and $0.5
million of lower business development expenses. The
2014 figure also included $0.5
million of certain fees that were not incurred in 2015.
Cash Flow Metrics
Cash flows from operating activities (GAAP) and Free Cash
Flow include the cash flows from projects classified as
discontinued operations. Free Cash Flow is a non-GAAP
measure. Table 10 of this press release provides a
reconciliation of Free Cash Flow to cash flows from operating
activities.
Cash flows provided by operating activities of
$19.7 million in the fourth quarter
of 2015 increased $0.6 million from
$19.1 million in the fourth quarter
of 2014. The increase was primarily attributable to
significantly lower interest expense and lower corporate G&A
expense, which were partially offset by lower Project Adjusted
EBITDA (primarily due to the sale of the Wind projects in 2015) and
other factors.
Free Cash Flow, which is after debt repayment,
capital expenditures and preferred dividends, was $(0.4) million for the fourth quarter of 2015
compared to $(7.2) million for the
fourth quarter of 2014. The increase is primarily due to a
decrease in project-level debt repayments and a reduction in
distributions to noncontrolling interests, including preferred
dividends (which were favorably affected by the exchange rate).
Cash Distributions from Projects and the adjusted cash flow
metrics discussed below, all of which are non-GAAP measures,
exclude cash flows from projects classified as discontinued
operations. Adjusted Cash Flows from Operating Activities,
which excludes discontinued operations, changes in working capital,
severance, restructuring charges, acquisition and disposition
expenses and debt prepayment and redemption costs, is a measure of
the cash flow available to the Company to make principal repayments
on its debt (primarily through amortization and the cash sweep
under the APLP term loan), invest in its fleet through required or
discretionary capital expenditures, and make dividend payments to
preferred shareholders. Adjusted Free Cash Flow is after debt
repayment or amortization, capital expenditures and preferred
dividends, but is before any discretionary uses of cash flow,
including repurchases of debt and equity securities, external
growth investments or additional internal capex projects.
Tables 10 and 11 of this press release provide a reconciliation of
the Company's non-GAAP cash flow metrics to cash flows from
operating activities.
Cash Distributions from Projects decreased $11.6 million to $46.0
million for the fourth quarter of 2015 from $57.6 million for the same period in 2014.
The decrease was primarily due to the PPA expiration at
Tunis, which had a negative impact
of $4.7 million; the Ontario projects, due to the timing of
customer payments; Mamquam, which experienced record low water
flows in 2015; the Navy projects, which benefited from the timing
of gas payments in the 2014 period, and Williams Lake, which experienced an
unfavorable foreign exchange rate impact. This net decrease
was partially offset by increases at Nipigon, which underwent a major outage to
upgrade and replace its steam generator in 2014; Curtis Palmer,
which benefited from higher water flows, and Kenilworth, which benefited from the timing of
a gas payment.
Adjusted Cash Flows from Operating Activities increased
$11.4 million to $29.3 million in the fourth quarter of 2015 from
$17.9 million in the year-ago period,
primarily because of lower cash interest payments and lower
corporate G&A expense, partially offset by lower Project
Adjusted EBITDA. The 2015 result excludes $5.0 million of cash tax payments associated with
the sale of the Wind Projects; the 2014 result excludes operating
cash flows of the Wind Projects of $11.3
million.
Adjusted Free Cash Flow increased to $9.2 million in the fourth quarter of 2015 from
$(1.4) million in the fourth quarter
of 2014. The $10.6 million
increase was primarily attributable to higher Adjusted Cash Flows
from Operating Activities and several other less significant
factors.
Twelve Months Ended December 31,
2015
Project loss for the full year 2015 was $(41.4) million as compared to ($38.9) million in 2014. The increased loss
was attributable to a $21.2 million
increase in impairment expense and the absence of an $8.6 million gain on the sale of Delta-Person
recorded in 2014, partially offset by an $11.2 million increase in equity earnings of
affiliates, a $9.5 million reduction
in interest expense and an $8.6
million increase in the change in the fair value of
derivatives. Impairment expense in 2015 was as described in
the discussion of results for the three months ended December 31, 2015, while in 2014 it included
$106.6 million of impairments of
long-lived assets and goodwill at Tunis and of goodwill at Kenilworth, Manchief and Williams Lake.
Project Adjusted EBITDA decreased $20.5 million to $208.9
million for the full year 2015 from $229.4 million for 2014. The most
significant drivers of the decline were lower results from
Tunis, due to its mothballed
status; Selkirk, due to the
expiration of its PPA and reduced dispatch in an unfavorable market
environment; Manchief, which had a gas turbine maintenance outage;
lower water flows at Curtis Palmer and Mamquam; higher fuel and
maintenance expense at North Bay
and Kapuskasing, partially offset
by higher waste heat generation; and lower excess energy margins at
Chambers. Currency had an approximate $(9.0) million impact on Project Adjusted EBITDA,
with an average U.S. dollar to Canadian dollar exchange rate for
2015 of 1.27 versus 1.11 for the year-ago period. These
negative factors were partially offset by increases at Orlando, which benefited from higher
generation, lower fuel expenses due to lower gas prices and rate
escalations under the PPA; Morris, which had lower fuel expense,
reduced property taxes, and higher PJM capacity pricing, partially
offset by lower merchant pricing than the comparable year-ago
period; Nipigon, which had a
maintenance outage in the comparable year-ago period and also
benefited from rate escalations and high levels of waste heat;
North Island, which had a gas turbine overhaul in 2014, and
Calstock, which had higher waste
heat generation and lower maintenance expense than the year-ago
period. In addition, the Un-allocated Corporate segment had a
reduced loss of $(2.5) million versus
$(7.5) million in the year-ago
period, due primarily to a reduction in project-level compensation
expense and decreased development and administrative
costs.
Corporate-level G&A expense decreased
$8.5 million to $29.4 million for the
full year 2015 from $37.9 million in
2014. The improvement was primarily attributable to a
$3.9 million reduction in legal
expenses associated with the U.S. and Canadian shareholder actions,
a $1.9 million decrease in business
development costs related to divestitures and a $1.9 million decrease in employee severance
expense.
Cash Flow Metrics
Cash flows provided by operating activities of
$87.4 million for the full year 2015
increased $22.4 million from
$65.0 million for the comparable
period in 2014. The increase is primarily due to a
$27.3 million reduction in financing
transaction costs and a $13.6 million
reduction in total G&A expense, partially offset by a
$21.9 million reduction in operating
cash flows from the Wind Projects, which were sold in June 2015.
Free Cash Flow was $(19.8)
million for the full year 2015 compared to $(55.6) million for 2014. The increase is
primarily due to the $22.4 million
increase in operating cash flows described previously, a
$7.3 million decrease in
distributions to noncontrolling interests related to Canadian Hills
and Rockland, a $2.8 million decrease in preferred dividends
(driven primarily by the exchange rate) and a $2.1 million reduction in capital
expenditures. Repayment of the APLP term loan and
amortization of project debt totaled $83.4
million in 2015 versus $84.6
million in 2014, including $6.4
million associated with the Wind Projects and an
$8.1 million repayment of
Piedmont principal at term loan
conversion in February 2014.
Cash Distributions from Projects decreased $16.8 million to $192.3
million for the full year 2015 from $209.1 million for 2014. The decrease was
primarily due to PPA expirations at Tunis and Selkirk, an impact of $13.1 million and $9.3
million, respectively; Manchief, due to the gas turbine
outage and reduced dispatch, and the Navy projects, which benefited
from the timing of gas payments in the 2014 period.
This net decrease was partially offset by increases at
the following projects: Chambers, due to a change in the
timing of distributions; Morris, which benefited from lower gas
prices, reduced property taxes and a higher PJM capacity rate;
Orlando, which benefited from
lower gas prices, higher capacity payments and increased
generation; Calstock, which
benefited from additional waste heat and lower maintenance expense
relative to the year-ago period when it had an outage, and
Nipigon, which benefited from
improved availability following two outages in 2014, additional
waste heat and higher capacity payments due to contract
escalation.
Adjusted Cash Flows from Operating Activities of
$105.3 million for the full year 2015
increased $12.9 million from
$92.4 million in 2014. The 2015
result excludes $6.2 million of cash
tax payments in the third and fourth quarters associated with the
sale of the Wind Projects as well as the $14.0 million premium and $5.5 million of accrued interest paid at
redemption of the 9.0% Senior Unsecured Notes (the "9.0% Notes") in
June 2015. The 2014 result excludes $49.4 million of interest expense associated with
the debt refinancing and repurchase transactions in the first
quarter of 2014. The increase in Adjusted Cash Flows from
Operating Activities was primarily attributable to a $26.7 million reduction in cash interest payments
and an $8.5 million reduction in
corporate G&A expense, partially offset by lower Project
Adjusted EBITDA.
Adjusted Free Cash Flow of $1.8
million increased $2.1 million
for the full year 2015 from $(0.3)
million in 2014. Results for both years exclude
interest expense associated with debt refinancing or redemption as
described above. The 2014 result also excludes an
$8.1 million Piedmont principal repayment at term loan
conversion. The increase in Adjusted Free Cash Flow was
primarily attributable to the $12.9
million increase in Adjusted Cash Flows from Operating
Activities described above and a $2.8
million reduction in preferred dividend payments (driven by
a more favorable exchange rate), which were mostly offset by a
$13.3 million increase in term loan
and project debt amortization. The 2015 Adjusted Free Cash
Flow of $1.8 million was at the lower
end of the Company's guidance range of $0 to
$10 million due to a delay in receipt of a customer
reimbursement for a 2015 construction project. The
$6 million cash payment was received
in February 2016.
Results of Discontinued Operations
The Wind Projects were sold in June
2015 and are a component of discontinued operations for the
three and twelve months ended December 31,
2015 and 2014. Greeley was sold in March 2014 and is included as a component of
discontinued operations for the twelve months ended December 31, 2014. The results for Greeley
were immaterial during that period.
Project Adjusted EBITDA of the Wind Projects was
$0.0 million for the fourth quarter
of 2015 versus $20.7 million for the
comparable year-ago period. Results for the full year 2015
were $28.1 million versus
$69.8 million for 2014.
Cash flows from operating activities of the Wind Projects
were $0.0 million and $21.9 million for the fourth quarter and full
year 2015, respectively. These operating cash flows were
reduced by $5.0 million and
$6.2 million, respectively, of
withholding and alternative minimum tax payments associated with
the sale of the Wind Projects. The operating cash flows of
the Wind Projects were $11.3 million
and $48.3 million, respectively, for
the fourth quarter and full year 2014.
Liquidity
As shown in Table 3, the Company's liquidity at December 31, 2015 was $178.4 million, including $72.4 million of unrestricted cash. In
February 2016, there were two
developments that positively affected the Company's
liquidity. The Company received a $6
million reimbursement for construction costs incurred in
2015 at one of its projects on behalf of the project's
customer. That reimbursement is subject to the 50% cash sweep
of the APLP term loan. Separately, Standard & Poor's
upgraded the Company's corporate credit rating to B+ from B, which
allowed the Company to reduce an existing letter of credit with one
of its counterparties by $10
million. Pro forma for these two adjustments, the
Company's liquidity would be approximately $13 million higher than the year end 2015
level.
Atlantic Power
Corporation
|
|
|
Table 3 –
Liquidity (in millions of U.S. dollars)
|
|
|
Unaudited
|
|
|
|
September 30,
2015
|
December 31,
2015
|
Revolver
capacity
|
$210.0
|
$210.0
|
Letters of credit
outstanding
|
(109.2)
|
(104.0)
|
Unused borrowing
capacity
|
100.8
|
106.0
|
Unrestricted cash
(1)
|
76.4
|
72.4
|
Total
Liquidity
|
$177.2
|
$178.4
|
(1)
Includes project-level cash for working capital needs of $13.0
million at each of September 30, 2015 and December 31,
2015.
|
Note: Does not
include restricted cash of $14.5 million at September 30, 2015 and
$15.2 million at December 31, 2015.
|
Other Financial Updates
Impairment Charge and Finding of Material Weakness
In the fourth quarter of 2015, the Company performed its annual
goodwill impairment test and determined that it was necessary to
impair the carrying value of long-lived assets at Calstock and Williams Lake and to record a full impairment
of remaining goodwill at both projects as well as a partial
impairment of goodwill at Curtis Palmer. The primary reason
for the impairment was the impact of significantly lower forward
power prices, driven by an extended period of lower natural gas and
oil prices, on expected cash flows from the projects following the
expirations of their respective PPAs. The impairment charge,
which is non-cash, totaled $127.8
million. There was no impact on Project Adjusted
EBITDA or the Company's adjusted cash flow metrics.
As discussed in the Company's annual report on Form 10-K,
management has determined that a material weakness existed in the
Company's internal control over financial reporting because its
annual goodwill impairment test resulted in an initial finding that
no impairment of long-lived assets was required and that goodwill
would be impaired by a smaller amount than subsequently
determined. Management is in the process of determining and
implementing a remediation plan and expects the control weakness to
be remediated in the coming year.
Progress on Debt Reduction
In the fourth quarter of 2015, the Company made additional
progress in reducing its debt, making $11.7
million of payments on the APLP term loan and amortizing
$4.4 million of project-level
debt. The Company also repurchased $0.2 million of convertible debentures pursuant
to the NCIB.
For the full year 2015, the Company repaid $68.3 million of the APLP term loan through the
1% mandatory annual amortization and the 50% cash sweep, reducing
the outstanding balance to $473.2
million, and amortized $15.1
million of project-level debt. Discretionary
repurchases of its convertibles pursuant to the NCIB totaled
$21.8 million; in addition, the
Company repurchased $9.0 million of
its 9.0% Notes in the first quarter of 2015. The Company used
the proceeds from the sale of its Wind Projects to fund the
redemption of the $310.9 million
remaining principal amount of the 9.0% Notes in July.
Approximately $249 million of debt
associated with the Wind Projects was deconsolidated as a result of
the sale.
Since year end 2013, the Company has reduced its total debt by
$833 million, including its
$76 million share of debt at
equity-owned projects (mostly for Wind projects). The
interest cost savings associated with total debt reduction are more
than $65 million on an annualized
basis.
Further debt reduction is expected to be achieved through
continued amortization of project-level debt and the APLP term
loan, which together are expected to average approximately
$65 to $70 million annually over the
next two years.
The Company also has an improved corporate maturity
profile. The remaining corporate debt consists of
$285 million (U.S. dollar equivalent)
of convertible debentures maturing in 2017 ($103 million) and 2019 ($182 million). The Company continues to
explore opportunities to address these maturities.
In February 2016, the Company
received a corporate credit rating upgrade from Standard &
Poor's to B+ from B. This follows an upgrade by Moody's last
October to B1 from B2. Both agencies have "stable" ratings
outlooks for the Company.
G&A Expense Targets
For the full year 2015, total G&A expense was $31.9 million, including $2.6 million of development expense and
project-level G&A that are included in Project Adjusted
EBITDA. The $31.9 million
includes $4 million of severance
expense and $2 million of
restructuring and other charges. The Company expects 2016
total G&A expense of approximately $27
million, which would represent a 50% cumulative reduction
from the 2013 level of approximately $54
million.
Optimization Investments
The majority of the Company's capital expenditures are
discretionary investments in existing projects designed to increase
their output or improve their efficiency in order to enhance the
margins of these facilities. The Company considers these
investments to be an attractive use of its cash considering the
relatively modest capital requirements and potential for strong
risk-adjusted returns.
From 2013 to 2015, the Company invested approximately
$22 million in such projects, net of
a customer reimbursement, the most significant of which were the
turbine upgrades at Curtis Palmer completed in 2013 and 2014, the
Nipigon Once-Through Steam Generator upgrade and feedwater booster
pump installation, completed in 2014 and 2015, respectively, and
several projects at Morris. In 2015, the Company realized a
cash flow benefit from completed projects of approximately
$6 million. This contribution,
although reduced by low water flows at Curtis Palmer and high
levels of waste heat at Nipigon,
was in line with the Company's expectations. The Company
expects this contribution to increase to approximately $10 million in 2016, including an initial cash
flow contribution from projects expected to be completed by
mid-2016. This outlook assumes lower waste heat levels in
2016 than in 2015, though still above typical levels, and average
water flows at Curtis Palmer.
The Company expects that optimization-related investments will
total approximately $4 million in
2016, mostly for upgrades to a boiler and two gas turbines at
Morris and a spillway upgrade project at Curtis Palmer. The
Company has other optimization projects under consideration that
could require additional expenditures in 2016.
Maintenance and Capex
For the full year 2015, capital expenditures were $11 million, of which approximately $9 million was attributable to discretionary
optimization projects. In addition to amounts capitalized,
the Company incurs maintenance expense to maintain its
projects. Total maintenance expense was approximately
$56 million for 2015.
For 2016, the Company expects to have capital expenditures of
$16 to $19 million, with the range
attributable to potential optimization projects not yet firmly
committed to. The most significant budgeted expenditures are
for the optimization projects at Morris and Curtis Palmer
(approximately $4 million) and for
the 2016 portion of costs associated with the repowering of
Tunis and a new fuel shredder for
Williams Lake (approximately
$7 million for the two
projects). In addition, the Company expects to incur
maintenance expense of approximately $57
million.
Morris Energy Services Agreement (ESA) and Planned
Outages
As announced in December, the Company has executed an agreement
with the customer at its Morris project to modify and extend the
ESA from November 2023 to December
2034. The modifications to the ESA are expected to be
modestly accretive to the Project Adjusted EBITDA from Morris on
average relative to the original contract terms. As of
December 31, 2015, including the
impact of the Morris ESA extension, the weighted-average remaining
life of the Company's PPAs is 7.5 years (on an EBITDA-weighted
basis).
Separately, and not related to the ESA modifications and
extension, the Company expects that Morris will undergo an
approximately six-week major maintenance outage in the late summer
of 2016. During this outage, the Company will continue work
on upgrading two of the project's combustion turbines, overhaul the
steam turbine and upgrade the plant's Distributed Controls
System. Together with an upgrade to one of the project's
boilers scheduled to be completed earlier in the year, these
upgrades are expected to increase output and fuel efficiency as
well as enhance reliability of steam delivery for the customer.
Higher maintenance expense and lost margin associated with
the extended outage, as well as other less significant factors, are
expected to reduce Project Adjusted EBITDA from the Morris project
by approximately $9 million in 2016
from a higher-than-average level in 2015.
Normal Course Issuer Bid (NCIB)
As announced in December 2015, the
Company has implemented an NCIB for up to 10% of each of its
outstanding convertible debentures and its common shares and up to
5% of Atlantic Power Preferred Equity Ltd.'s preferred
shares. The NCIB became effective in late December and is
scheduled to expire on December 28,
2016. Since late December, the Company has repurchased
approximately 575,000 shares under the NCIB at a total cost of
approximately US$1.0 million.
Changes to Capital Allocation Strategy
In February 2016, the Company
announced changes to its capital allocation strategy designed to
create value for shareholders in a tax-efficient manner while
improving the Company's financial flexibility and strengthening its
balance sheet. These changes included elimination of the
common stock dividend (and the related dividend reinvestment plan),
effective immediately, and prioritization of its discretionary cash
after debt repayment for higher-return purposes, including
repurchases of its debt and equity securities under the NCIB at
compelling price-to-value levels and attractive investments in
internal optimization projects.
2016 Guidance
Atlantic Power
Corporation
|
|
|
Table 4 – FY
2015 Actual Results vs. 2016 Guidance
|
|
|
(in millions of
U.S. dollars, except as otherwise stated)
|
|
|
Unaudited
|
|
|
|
FY
2015
|
FY
2016
|
|
Actual
|
Guidance
|
Project Adjusted
EBITDA
|
$208.9
|
$200 -
$220
|
Adjusted Cash Flows
from Operating Activities (1)
|
$105.3
|
$110 -
$130
|
Adjusted Free Cash
Flow (2)
|
$1.8
|
$20 - $40
|
APLP Project Adjusted
EBITDA (3)
|
$155.2
|
$145 -
$155
|
|
|
|
(1)
Adjusted Cash Flows from Operating Activities is used to evaluate
cash flows from operating activities without the effects of changes
in
working capital balances, acquisition and disposition expenses,
litigation expenses, severance and restructuring charges, debt
prepayment
and redemption costs and cash provided by or used in discontinued
operations. The intent is to reflect normal operations and
remove items
that are not reflective of the long-term operations of the
business.
|
(2)
Adjusted Free Cash Flow is defined as Free Cash Flow excluding
changes in working capital balances, acquisition and disposition
expenses, litigation expense, severance and restructuring charges,
debt prepayment and redemption costs and cash provided by or used
in discontinued operations. Free Cash Flow is defined as cash
flows from operating activities less capex; project-level debt
repayments, including amortization of the APLP term loan; and
distributions to noncontrolling interests, including preferred
share dividends.
|
(3) APLP
is a wholly owned subsidiary of the Company. APLP Project
Adjusted EBITDA is a summation of Project Adjusted EBITDA at each
APLP project, and is calculated in a manner which is consistent
with the Company's Project Adjusted EBITDA
calculation.
|
|
Note: Project
Adjusted EBITDA, Adjusted Cash Flows from Operating Activities,
Adjusted Free Cash Flow and APLP Project Adjusted EBITDA are not
recognized measures under GAAP and do not have any standardized
meaning prescribed by GAAP; therefore, these measures may not be
comparable to similar measures presented by other companies.
The Company has not provided a reconciliation of forward-looking
non-GAAP measures, due primarily to variability and difficulty in
making accurate forecasts and projections, as not all of the
information necessary for a quantitative reconciliation is
available to the Company without unreasonable efforts.
|
Table 4 shows the Company's full-year 2016 guidance as compared
to the actual results for 2015. Key drivers are as
follows:
- Total Company Project Adjusted EBITDA of $200 to $220 million. Positive drivers in
2016 include an assumed return to average water flows at Mamquam
and Curtis Palmer (versus historic lows in 2015), a full-year
return on optimization investments and the non-recurrence of the
major gas turbine outage at Manchief in 2015. These are mostly
offset by the negative impacts of an extended outage at Morris, an
unfavorable exchange rate, and an assumed reduction in waste heat
from historically high levels in 2015.
- APLP Project Adjusted EBITDA of $145
to $155 million. Drivers are consistent with those for
Total Company Project Adjusted EBITDA.
- Adjusted Cash Flows from Operating Activities of
$110 to $130 million. The
expected increase in 2016 is largely attributable to lower cash
interest payments.
- Adjusted Free Cash Flow of $20 to $40
million. The expected increase in 2016 is attributable
to the expected increase in Adjusted Cash Flows from Operating
Activities, lower debt repayment and a customer reimbursement for
2015 construction costs received in 2016.
Other Recent Developments
Share Purchases by Insiders
In the fourth quarter, two senior executives and one director of
the Company purchased a total of approximately 493,000 common
shares of the Company at an average price of US$1.77 per share. Including those made in
previous quarters, purchases by management and directors this year
total approximately 1.05 million common shares. The average
purchase price for these purchases was US$2.31 per share. There have been no sales
of shares by officers or directors this year, other than those sold
automatically for tax withholding purposes upon vesting under the
Long-Term Incentive Plan.
Shareholder Litigation
As announced by the Company in December, both the U.S. and
Ontario securities class action
suits were dismissed by the respective courts, with no payments
required by the Company. Following the resolution of the
Ontario matter, the petitioner in
the Quebec proceedings has agreed
in principle with the defendants in the suit to discontinue the
proceedings, with each side bearing its own costs. The
agreement is subject to the approval of the Superior Court of
Quebec.
Supplementary Financial Information
For further information, attached to this news release is a
summary of Project Adjusted EBITDA by segment for the three and
twelve months ended December 31, 2015
and 2014 (Table 8) with a reconciliation to project income (loss);
a bridge from Project Adjusted EBITDA to Cash Distributions from
Projects by segment for the year ended December 31, 2015 (Table 9A) and the year ended
December 31, 2014 (Table 9B); a
reconciliation of Cash Distributions from Projects and Project
Adjusted EBITDA to net income (loss) and of various non-GAAP cash
flow metrics to cash flows from operating activities for the three
and twelve months ended December 31,
2015 and 2014 (Table 10); reconciliations of Adjusted Cash
Flows from Operating Activities and Adjusted Free Cash Flow to cash
flows from operating activities for the three and twelve months
ended December 31, 2015 and 2014
(Tables 11A and 11B); and a summary of Project Adjusted EBITDA for
selected projects (top contributors based on the Company's 2015
budget, representing approximately 90% of total Project Adjusted
EBITDA) for the three and twelve months ended December 31, 2015 and 2014 (Table 12).
Investor Conference Call and Webcast
Atlantic Power's management team will host a telephone
conference call on Tuesday, March 8,
2016 at 8:30 AM ET. An
accompanying slide presentation will be available on the Company's
website prior to the call.
Conference Call / Webcast Information:
Date: Tuesday, March
8, 2016
Start Time: 8:30 AM
ET
Phone Number: U.S. (Toll Free) 1-877-870-4263;
Canada (Toll Free) 1-855-669-9657;
International (Toll) 1-412-317-0790
Conference Access: Please request access to the
Atlantic Power conference call.
Webcast: The call will be broadcast over Atlantic
Power's website at www.atlanticpower.com.
Replay/Archive Information:
Replay: Access conference call number 10079885 at
the following telephone numbers: U.S. (Toll Free)
1-877-344-7529; Canada (Toll Free)
1-855-669-9658; International (Toll) 1-412-317-0088. The
replay will be available one hour after the end of the conference
call through April 6, 2016 at
11:59 PM ET.
Webcast archive: The conference call will be
archived on Atlantic Power's website at www.atlanticpower.com for a
period of 12 months.
About Atlantic Power
Atlantic Power owns and operates a diverse fleet of power
generation assets in the United
States and Canada. The Company's power generation
projects sell electricity to utilities and other large commercial
customers largely under long-term power purchase agreements, which
seek to minimize exposure to changes in commodity prices.
Atlantic Power's power generation projects in operation have an
aggregate gross electric generation capacity of approximately 2,138
megawatts ("MW") in which its aggregate ownership interest is
approximately 1,500 MW. The Company's current portfolio
consists of interests in twenty-three operational power generation
projects across nine states in the United
States and two provinces in Canada.
Atlantic Power trades on the New York Stock Exchange under the
symbol AT and on the Toronto Stock Exchange under the symbol
ATP. For more information, please visit the Company's website
at www.atlanticpower.com or contact:
Atlantic Power Corporation
Investor Relations
(617) 977-2700
info@atlanticpower.com
Copies of certain financial data and other publicly filed
documents are filed on SEDAR at www.sedar.com or on EDGAR at
www.sec.gov/edgar.shtml under "Atlantic Power Corporation" or on
the Company's website.
Cautionary Note Regarding Forward-Looking Statements
To the extent any statements made in this news release contain
information that is not historical, these statements are
forward-looking statements within the meaning of Section 27A of the
U.S. Securities Act of 1933, as amended, and Section 21E of the
U.S. Securities Exchange Act of 1934, as amended, and under
Canadian securities law (collectively, "forward-looking
statements").
Certain statements in this news release may constitute
"forward-looking statements", which reflect the expectations of
management regarding the future growth, results of operations,
performance and business prospects and opportunities of the Company
and its projects. These statements, which are based on
certain assumptions and describe the Company's future plans,
strategies and expectations, can generally be identified by the use
of the words "may," "will," "project," "continue," "believe,"
"intend," "anticipate," "expect" or similar expressions that are
predictions of or indicate future events or trends and which do not
relate solely to present or historical matters. Examples of
such statements in this press release include, but are not limited,
to statements with respect to the following:
- that the Company's discretionary cash flow after debt repayment
is growing, and there are ample opportunities to invest the cash at
good returns;
- the Company's ability to make progress on further extensions of
its existing PPAs;
- the Company's ability to address its convertible debenture
maturities;
- the Company expects to further reduce debt through continued
amortization of project-level debt and the APLP term loan, which
together are expected to average approximately $65 to $70 million annually over the next two
years;
- the Company expects to have total G&A costs of
approximately $27 million in
2016;
- the Company expects to realize a cash flow benefit from
discretionary investments in its existing projects of approximately
$10 million in 2016;
- the Company expects that discretionary optimization investments
in its fleet will be approximately $4
million in 2016;
- the Company expects that in 2016, capital expenditures will
total approximately $16 to $19
million, before a $5 million
credit for a customer reimbursement, and maintenance expense will
total approximately $57 million;
- the Company expects a modest increase in Project Adjusted
EBITDA from Morris on average relative to the terms of the original
ESA;
- the Company expects that Morris will undergo an extended
maintenance outage in the late summer of 2016;
- upgrades of the Morris project's combustion turbines and one of
its boilers are expected to enhance the project's output and
reliability;
- the Company expects an approximate $9
million reduction in 2016 Project Adjusted EBITDA from
Morris due to the planned outages and other less significant
factors in 2016;
- the Company may purchase, through the NCIB, up to 10% of each
of its convertible debentures and common shares and Atlantic Power
Preferred Equity Ltd. may purchase up to 5% of its preferred
shares;
- changes to the Company's capital allocation strategy will
create value in a tax-efficient manner while improving the
Company's financial flexibility and strengthening its balance
sheet;
- the Company's ability to capture value from repurchases of its
equity and debt securities;
- the Company's plans to focus on organic growth and to evaluate
external opportunities in a disciplined and opportunistic
manner;
- the Company's ability to realize high returns on its internal
growth investments;
- 2016 Project Adjusted EBITDA will be in the range of
$200 to $220 million;
- 2016 APLP Project Adjusted EBITDA will be in the range of
$145 to $155 million;
- 2016 Adjusted Cash Flows from Operating Activities will be in
the range of $110 to $130
million;
- 2016 Adjusted Free Cash Flow will be in the range of
$20 to $40 million;
- the nature of any further proceedings in the Quebec securities action;
- the Company's ability to remediate the material weakness in its
internal controls over financial reporting; and
- the results of operations and performance of the Company's
projects, business prospects, opportunities and future growth of
the Company will be as described herein.
Forward-looking statements involve significant risks and
uncertainties, should not be read as guarantees of future
performance or results, and will not necessarily be accurate
indications of whether or not or the times at or by which such
performance or results will be achieved. Please refer to the
factors discussed under "Risk Factors" and "Forward-Looking
Information" in the Company's periodic reports as filed with the
Securities and Exchange Commission from time to time for a detailed
discussion of the risks and uncertainties affecting the Company,
including, without limitation, the outcome or impact of the
Company's business plan, including the objective of enhancing the
value of its existing assets through optimization investments and
commercial activities, delevering its balance sheet to improve its
cost of capital and ability to compete for new investments, and
utilizing its core competencies to create proprietary investment
opportunities, and the Company's ability to raise additional
capital for growth and/or debt reduction, and the outcome or impact
on the Company's business of any such actions. Although the
forward-looking statements contained in this news release are based
upon what are believed to be reasonable assumptions, investors
cannot be assured that actual results will be consistent with these
forward-looking statements, and the differences may be material.
These forward-looking statements are made as of the date of
this news release and, except as expressly required by applicable
law, the Company assumes no obligation to update or revise them to
reflect new events or circumstances. The Company's ability to
achieve its longer-term goals, including those described in this
news release, is based on significant assumptions relating to and
including, among other things, the general conditions of the
markets in which it operates, revenues, internal and external
growth opportunities, its ability to sell assets at favorable
prices or at all and general financial market and interest rate
conditions. The Company's actual results may differ, possibly
materially and adversely, from these goals.
Atlantic Power
Corporation
|
|
|
Table 5 –
Consolidated Balance Sheet (in millions of U.S.
dollars)
|
|
|
(Unaudited)
|
|
|
|
December
31,
|
December
31,
|
|
2015
|
2014
|
Assets
|
|
|
Current
assets:
|
|
|
Cash and cash
equivalents
|
$72.4
|
$106.0
|
Restricted
cash
|
15.2
|
22.5
|
Accounts
receivable
|
39.6
|
46.2
|
Inventory
|
16.9
|
19.3
|
Prepayments and other
current assets
|
8.3
|
10.6
|
Assets held for
sale
|
-
|
790.4
|
Income taxes
receivable
|
3.5
|
0.2
|
Other current
assets
|
4.4
|
3.3
|
Total current
assets
|
160.3
|
998.5
|
|
|
|
Property, plant and
equipment, net
|
777.7
|
962.9
|
Equity investments in
unconsolidated affiliates
|
286.2
|
306.9
|
Power purchase
agreements and intangible assets, net
|
308.9
|
377.1
|
Goodwill
|
134.5
|
197.2
|
Derivative
instruments asset
|
0.3
|
1.1
|
Deferred financing
costs
|
42.5
|
62.8
|
Other
assets
|
6.7
|
9.5
|
Total
assets
|
$1,717.1
|
$2,916.0
|
|
|
|
Liabilities
|
|
|
Current
liabilities:
|
|
|
Accounts
payable
|
$6.9
|
$9.4
|
Accrued
interest
|
1.6
|
5.3
|
Other accrued
liabilities
|
28.8
|
30.7
|
Current portion of
long-term debt
|
15.8
|
20.0
|
Current portion of
derivative instruments liability
|
36.7
|
36.1
|
Liabilities held for
sale
|
-
|
271.8
|
Other current
liabilities
|
2.5
|
6.8
|
Total current
liabilities
|
92.3
|
380.1
|
|
|
|
Long-term
debt
|
717.5
|
1,145.9
|
Convertible
debentures
|
285.4
|
340.6
|
Derivative
instruments liability
|
20.8
|
47.5
|
Deferred income
taxes
|
85.7
|
92.4
|
Power purchase and
fuel supply agreement liabilities, net
|
27.0
|
33.4
|
Other long-term
liabilities
|
53.2
|
59.6
|
Total
liabilities
|
$1,281.9
|
$2,099.5
|
|
|
|
Equity
|
|
|
Common shares, no par
value, unlimited authorized shares; 122,153,082 and
121,323,614
|
|
issued and
outstanding at December 31, 2015 and December 31, 2014,
respectively
|
1,290.6
|
1,288.4
|
Accumulated other
comprehensive loss
|
(139.3)
|
(68.3)
|
Retained
deficit
|
(937.4)
|
(863.9)
|
Total Atlantic Power
Corporation shareholders' equity
|
213.9
|
356.2
|
Preferred shares
issued by a subsidiary company
|
221.3
|
221.3
|
Noncontrolling
interests
|
-
|
239.0
|
Total
equity
|
435.2
|
816.5
|
Total liabilities and
equity
|
$1,717.1
|
$2,916.0
|
Atlantic Power
Corporation
|
|
|
|
|
|
|
Table 6 –
Consolidated Statements of Operations
|
|
|
|
|
|
(in millions of
U.S. dollars, except per share amounts)
|
|
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
Twelve months
ended
|
|
December
31,
|
December
31,
|
|
|
2015
|
2014
|
|
2015
|
2014
|
Project
revenue:
|
|
|
|
|
|
|
Energy
sales
|
|
$46.6
|
$59.4
|
|
$191.5
|
$236.9
|
Energy capacity
revenue
|
|
31.9
|
37.3
|
|
149.3
|
161.3
|
Other
|
|
19.9
|
23.1
|
|
79.4
|
91.7
|
|
|
98.4
|
119.9
|
|
420.2
|
489.9
|
Project
expenses:
|
|
|
|
|
|
|
Fuel
|
|
39.8
|
50.9
|
|
165.1
|
210.4
|
Operations and
maintenance
|
|
21.9
|
23.5
|
|
103.5
|
109.0
|
Development
|
|
-
|
1.0
|
|
1.1
|
3.7
|
Depreciation and
amortization
|
|
26.2
|
30.2
|
|
110.0
|
122.3
|
|
|
87.9
|
105.6
|
|
379.7
|
445.4
|
Project other income
(expense):
|
|
|
|
|
|
|
Change in fair value
of derivative instruments
|
|
6.7
|
(16.5)
|
|
15.4
|
6.8
|
Equity in earnings of
unconsolidated affiliates
|
|
8.4
|
(2.3)
|
|
36.7
|
25.5
|
Gain on sale of
equity investments
|
|
-
|
8.6
|
|
-
|
8.6
|
Interest expense,
net
|
|
(2.0)
|
(2.0)
|
|
(8.2)
|
(17.7)
|
Impairment
|
|
(127.8)
|
-
|
|
(127.8)
|
(106.6)
|
Other income
(expense), net
|
|
(0.1)
|
-
|
|
2.0
|
-
|
|
|
(114.8)
|
(12.2)
|
|
(81.9)
|
(83.4)
|
Project income
(loss)
|
|
(104.3)
|
2.1
|
|
(41.4)
|
(38.9)
|
|
|
|
|
|
|
|
Administrative and
other expenses (income):
|
|
|
|
|
|
|
Administration
|
|
6.4
|
11.2
|
|
29.4
|
37.9
|
Interest,
net
|
|
15.8
|
25.9
|
|
107.1
|
146.7
|
Foreign exchange
gain
|
|
(11.2)
|
(17.9)
|
|
(60.3)
|
(38.3)
|
Other income,
net
|
|
0.2
|
(0.6)
|
|
(3.1)
|
(0.6)
|
|
|
11.2
|
18.6
|
|
73.1
|
145.7
|
(Loss) income from
continuing operations before income taxes
|
|
(115.5)
|
(16.5)
|
|
(114.5)
|
(184.6)
|
Income tax expense
(benefit)
|
|
(30.1)
|
(11.4)
|
|
(30.4)
|
(31.4)
|
(Loss) income from
continuing operations
|
|
(85.4)
|
(5.1)
|
|
(84.1)
|
(153.2)
|
Net income (loss)
from discontinued operations, net of tax (1)
|
|
(1.3)
|
(7.3)
|
|
19.5
|
(29.0)
|
Net income
(loss)
|
|
(86.7)
|
(12.4)
|
|
(64.6)
|
(182.2)
|
Net income (loss)
attributable to noncontrolling interests
|
|
-
|
(4.6)
|
|
(11.0)
|
(16.4)
|
Net income
attributable to preferred share dividends of a subsidiary
company
|
1.9
|
2.8
|
|
8.8
|
11.6
|
Net income (loss)
attributable to Atlantic Power Corporation
|
|
($88.6)
|
($10.6)
|
|
($62.4)
|
($177.4)
|
|
|
|
|
|
|
|
Basic and diluted
earnings per share:
|
|
|
|
|
|
|
Loss from continuing
operations attributable to Atlantic Power Corporation
|
($0.60)
|
($0.07)
|
|
($0.76)
|
($1.37)
|
Income (loss) from
discontinued operations, net of tax
|
|
(0.01)
|
(0.02)
|
|
$0.25
|
($0.10)
|
Net income (loss)
attributable to Atlantic Power Corporation
|
|
($0.61)
|
($0.09)
|
|
($0.51)
|
($1.47)
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding:
|
|
|
|
|
|
|
Basic
|
|
122.1
|
121.0
|
|
121.9
|
120.7
|
Diluted
|
|
122.1
|
121.0
|
|
121.9
|
120.7
|
|
|
|
|
|
|
|
Dividends paid per
common share:
|
|
$0.02
|
$0.03
|
|
$0.09
|
$0.29
|
(1) Includes
contributions from the Wind Projects and Greeley, which are
components of discontinued operations.
|
|
|
|
|
|
|
|
|
|
Atlantic Power
Corporation
|
|
|
|
|
Table 7 –
Consolidated Statements of Cash Flows (in millions of U.S.
dollars)
|
|
|
Unaudited
|
|
|
|
|
|
|
Twelve months
ended December 31,
|
|
|
|
2015
|
2014
|
Cash flows from
operating activities:
|
|
|
|
|
Net Income
(loss)
|
|
|
($64.6)
|
($182.2)
|
Adjustments to
reconcile to net cash provided by operating activities:
|
|
|
|
|
Depreciation and
amortization
|
|
|
120.3
|
162.6
|
Loss from
discontinued operations
|
|
|
-
|
-
|
Gain on sale of
assets
|
|
|
(48.7)
|
(2.9)
|
Gain on sale of
equity investments
|
|
|
-
|
(8.6)
|
Gain on purchase and
cancellation of convertible debentures
|
|
|
(3.1)
|
-
|
Stock-based
compensation expense
|
|
|
2.3
|
3.5
|
Long-lived asset and
goodwill impairment charges
|
|
|
127.8
|
106.6
|
Equity in earnings
from unconsolidated affiliates
|
|
|
(36.2)
|
(25.8)
|
Distributions from
unconsolidated affiliates
|
|
|
58.5
|
76.2
|
Unrealized foreign
exchange gain
|
|
|
(60.5)
|
(38.8)
|
Change in fair value
of derivative instruments
|
|
|
(14.7)
|
8.7
|
Change in deferred
income taxes
|
|
|
(3.5)
|
(15.7)
|
Change in other
operating balances
|
|
|
|
|
Accounts
receivable
|
|
|
5.7
|
6.9
|
Inventory
|
|
|
2.4
|
(3.3)
|
Prepayments,
refundable income taxes and other assets
|
|
|
20.9
|
21.1
|
Accounts
payable
|
|
|
(8.9)
|
(4.1)
|
Accruals and other
liabilities
|
|
|
(10.3)
|
(39.2)
|
Cash provided by
operating activities
|
|
|
87.4
|
65.0
|
|
|
|
|
|
Cash flows provided
by investing activities:
|
|
|
|
|
Change in restricted
cash
|
|
|
7.3
|
72.6
|
Proceeds from sale of
assets and equity investments, net
|
|
|
326.3
|
9.5
|
Contribution to
unconsolidated affiliate
|
|
|
(0.6)
|
-
|
Development
costs
|
|
|
(0.8)
|
-
|
Purchase of property,
plant and equipment
|
|
|
(11.3)
|
(13.4)
|
Cash provided by
investing activities
|
|
|
320.9
|
68.7
|
|
|
|
|
|
Cash flows used in
financing activities:
|
|
|
|
|
Proceeds from senior
secured term loan facility
|
|
|
-
|
600.0
|
Repayment of
corporate and project-level debt
|
|
|
(403.3)
|
(639.8)
|
Repayment of
convertible debentures
|
|
|
(18.9)
|
(43.0)
|
Deferred financing
costs
|
|
|
-
|
(39.0)
|
Dividends paid to
common shareholders
|
|
|
(11.1)
|
(34.9)
|
Dividends paid to
noncontrolling interests
|
|
|
(3.7)
|
(11.1)
|
Dividends paid to
preferred shareholders
|
|
|
(8.8)
|
(14.6)
|
Cash used in
financing activities
|
|
|
(445.8)
|
(182.4)
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents
|
|
|
(37.5)
|
(48.7)
|
Cash and cash
equivalents at beginning of period at discontinued
operations
|
|
3.9
|
(3.9)
|
Cash and cash
equivalents at beginning of period
|
|
|
106.0
|
158.6
|
Cash and cash
equivalents at end of period
|
|
|
$72.4
|
$106.0
|
|
|
|
|
|
Supplemental cash
flow information
|
|
|
|
|
Interest
paid
|
|
|
$100.0
|
$168.8
|
Income taxes paid,
net
|
|
|
$10.2
|
$3.8
|
Accruals for
construction in progress
|
|
|
$0.6
|
$0.0
|
Regulation G Disclosures
Project Adjusted EBITDA is not a measure recognized under
GAAP and does not have a standardized meaning prescribed by GAAP,
and is therefore unlikely to be comparable to similar measures
presented by other companies. Project Adjusted EBITDA is
defined as project income (loss) plus interest, taxes, depreciation
and amortization (including non-cash impairment charges) and
changes in the fair value of derivative instruments.
Management uses Project Adjusted EBITDA at the project level to
provide comparative information about project performance and
believes such information is helpful to investors. A
reconciliation of Project Adjusted EBITDA to project income (loss)
is provided in Table 8 below. Investors are cautioned that
the Company may calculate this measure in a manner that is
different from other companies.
Cash Distributions from Projects, Adjusted Cash Flows from
Operating Activities, Free Cash Flow and Adjusted Free Cash
Flow are not measures recognized under GAAP and do not have
standardized meanings prescribed by GAAP, and are therefore
unlikely to be comparable to similar measures presented by other
companies. Adjusted Cash Flows from Operating Activities is
used to evaluate cash flows from operating activities without the
effects of changes in working capital balances, acquisition and
disposition expenses, litigation expenses, severance and
restructuring charges, and cash provided by or used in discontinued
operations. The intent is to reflect normal operations and
remove items that are not reflective of the long-term operations of
the business. Free Cash Flow is defined as cash flows from
operating activities less capex; project-level debt repayments,
including amortization of the term loan; and distributions to
noncontrolling interests, including preferred share dividends.
Adjusted Free Cash Flow is defined as Free Cash Flow excluding
changes in working capital balances, acquisition and disposition
expenses, litigation expense, severance and restructuring charges,
and cash provided by or used in discontinued operations.
Management believes that these non-GAAP cash flow measures
are relevant supplemental measures of the Company's ability to earn
and distribute cash returns to investors. A bridge of Project
Adjusted EBITDA to Cash Distributions from Projects is provided in
Tables 9A and 9B on page 19. A reconciliation of Free Cash
Flow to cash flows from operating activities is provided in Table
10 on page 20 of this release. Reconciliations of Adjusted
Free Cash Flow and Adjusted Cash Flows from Operating Activities to
cash flows from operating activities are provided in Tables 11A and
11B on pages 21 and 22 of this release. Investors are
cautioned that the Company may calculate these measures in a manner
that is different from other companies.
Atlantic Power
Corporation
|
|
|
|
|
|
|
Table 8 – Project
Adjusted EBITDA by Segment (in millions of U.S.
dollars)
|
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended
December 31
|
|
Twelve months
ended December 31
|
|
2015
|
2014
|
|
|
2015
|
2014
|
Project Adjusted
EBITDA by segment
|
|
|
|
|
|
|
East U.S.
|
$23.8
|
$24.1
|
|
|
$104.8
|
$106.4
|
West U.S.
(1)
|
9.8
|
9.4
|
|
|
46.9
|
54.2
|
Canada
|
16.7
|
24.7
|
|
|
59.7
|
76.3
|
Un-allocated
Corporate
|
0.1
|
(1.3)
|
|
|
(2.5)
|
(7.5)
|
Total
|
$50.4
|
$56.9
|
|
|
$208.9
|
$229.4
|
|
|
|
|
|
|
|
Reconciliation to
project income
|
|
|
|
|
|
|
Depreciation and
amortization
|
$31.2
|
$35.3
|
|
|
$130.1
|
$155.9
|
Interest expense,
net
|
2.1
|
2.4
|
|
|
9.8
|
20.5
|
Change in the fair
value of derivative instruments
|
(6.7)
|
16.8
|
|
|
(15.4)
|
(6.2)
|
Other (income)
expense
|
128.1
|
0.2
|
|
|
125.8
|
98.1
|
Project income
(loss)
|
($104.3)
|
$2.1
|
|
|
($41.4)
|
($38.9)
|
(1)
Excludes Greeley, which is a component of discontinued
operations.
|
|
|
|
|
Notes: Table 8
excludes the Wind Projects, which comprise the entirety of the
former Wind segment. The Wind Projects are designated as
discontinued operations for the three and twelve months ended
December 31, 2015 and 2014.
|
Table 8 presents
Project Adjusted EBITDA, which is not a recognized measure under
GAAP and does not have any standardized meaning prescribed by GAAP;
therefore, this measure may not be comparable to a similar measure
presented by other companies.
|
Atlantic Power
Corporation
|
|
|
|
|
Table 9A – Cash
Distributions from Projects (by Segment, in millions of U.S.
dollars)
|
|
|
Twelve months
ended December 31, 2015 (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unaudited
|
Project
Adjusted
EBITDA
|
Repayment of
long-term debt
|
Interest
expense,
net
|
Capital
expenditures
|
Other,
including
changes in
working capital
|
Cash
Distributions
from
Projects
|
Segment
|
|
|
|
|
|
|
|
|
|
|
|
East
U.S.
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
$65.8
|
|
($8.9)
|
|
($8.2)
|
|
($7.6)
|
|
$2.8
|
|
$43.9
|
Equity
method
|
39.0
|
|
(6.0)
|
|
(1.6)
|
|
(0.2)
|
|
3.7
|
|
34.9
|
Total
|
104.8
|
|
(14.9)
|
|
(9.8)
|
|
(7.8)
|
|
6.5
|
|
78.8
|
West
U.S.
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
33.6
|
|
-
|
|
-
|
|
(1.7)
|
|
4.3
|
|
36.1
|
Equity
method
|
13.3
|
|
-
|
|
-
|
|
(0.1)
|
|
0.7
|
|
13.9
|
Total
|
46.9
|
|
-
|
|
-
|
|
(1.8)
|
|
4.9
|
|
50.0
|
Canada
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
59.7
|
|
(0.3)
|
|
-
|
|
(2.3)
|
|
6.2
|
|
63.4
|
Equity
method
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Total
|
59.7
|
|
(0.3)
|
|
-
|
|
(2.3)
|
|
6.2
|
|
63.4
|
Total
consolidated
|
159.1
|
|
(9.1)
|
|
(8.2)
|
|
(11.6)
|
|
13.3
|
|
143.5
|
Total equity
method
|
52.3
|
|
(6.0)
|
|
(1.6)
|
|
(0.3)
|
|
4.4
|
|
48.8
|
Un-allocated
corporate
|
(2.5)
|
|
-
|
|
-
|
|
0.3
|
|
2.2
|
|
(0.0)
|
Total
|
$208.9
|
|
($15.1)
|
|
($9.8)
|
|
($11.5)
|
|
$19.9
|
|
$192.3
|
Note: Table 9A
presents Cash Distributions from Projects and Project Adjusted
EBITDA, which are not recognized measures under GAAP and do not
have any standardized meanings prescribed by GAAP; therefore, these
measures may not be comparable to similar measures presented by
other companies.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Atlantic Power
Corporation
|
|
|
|
|
|
|
|
|
|
|
Table 9B – Cash
Distributions from Projects (by Segment, in millions of U.S.
dollars)
|
|
|
Twelve months
ended December 31, 2014 (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Project Adjusted
EBITDA
|
Repayment of
long-term debt
|
Interest
expense,
net
|
Capital
expenditures
|
Other,
including
changes in
working capital
|
Cash
Distributions
from
Projects
|
Segment
|
|
|
|
|
|
|
|
|
|
|
|
East
U.S.
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
$62.2
|
|
($14.6)
|
|
($11.4)
|
|
($2.6)
|
|
$2.5
|
|
$36.0
|
Equity
method
|
44.2
|
|
(5.0)
|
|
(2.9)
|
|
(0.6)
|
|
1.2
|
|
36.9
|
Total
|
106.4
|
|
(19.6)
|
|
(14.4)
|
|
(3.2)
|
|
3.6
|
|
72.8
|
West
U.S.
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
39.8
|
|
-
|
|
-
|
|
-
|
|
1.7
|
|
41.6
|
Equity
method
|
14.4
|
|
-
|
|
-
|
|
(0.0)
|
|
0.5
|
|
14.9
|
Total
|
54.2
|
|
-
|
|
-
|
|
(0.0)
|
|
2.3
|
|
56.4
|
Canada
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated
|
76.3
|
|
-
|
|
(0.0)
|
|
(7.8)
|
|
5.9
|
|
74.4
|
Equity
method
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
Total
|
76.3
|
|
-
|
|
(0.0)
|
|
(7.8)
|
|
5.9
|
|
74.4
|
Total
consolidated
|
178.4
|
|
(14.6)
|
|
(11.5)
|
|
(10.4)
|
|
10.1
|
|
151.9
|
Total equity
method
|
58.6
|
|
(5.0)
|
|
(2.9)
|
|
(0.6)
|
|
1.7
|
|
51.7
|
Un-allocated
corporate
|
(7.5)
|
|
-
|
|
-
|
|
(1.6)
|
|
14.6
|
|
5.5
|
Total
|
$229.4
|
|
($19.6)
|
|
($14.4)
|
|
($12.6)
|
|
$26.4
|
|
$209.1
|
Note: Table 9B
presents Cash Distributions from Projects and Project Adjusted
EBITDA, which are not recognized measures under GAAP and do not
have any standardized meanings prescribed by GAAP; therefore, these
measures may not be comparable to similar measures presented by
other companies.
|
Atlantic Power
Corporation
|
|
|
|
|
|
|
|
|
Table 10 – Free
Cash Flow (in millions of U.S. dollars)
|
|
|
|
|
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
December
31,
|
|
Twelve months
ended
December
31,
|
|
|
|
2015
|
2014
|
|
|
2015
|
2014
|
Cash Distributions
from Projects
|
|
|
$46.0
|
$57.6
|
|
|
$192.3
|
$209.1
|
Repayment of
long-term debt
|
|
|
(4.3)
|
(3.6)
|
|
|
(15.1)
|
(19.6)
|
Interest expense,
net
|
|
|
(2.3)
|
(2.5)
|
|
|
(9.8)
|
(14.4)
|
Capital
expenditures
|
|
|
(1.2)
|
(3.1)
|
|
|
(11.5)
|
(12.6)
|
Other, including
changes in working capital
|
|
|
3.5
|
9.9
|
|
|
19.9
|
26.4
|
Project Adjusted
EBITDA
|
|
|
$50.4
|
$56.9
|
|
|
$208.9
|
$229.4
|
Depreciation and
amortization
|
|
|
31.2
|
35.3
|
|
|
130.1
|
155.9
|
Interest expense,
net
|
|
|
2.1
|
2.4
|
|
|
9.8
|
20.5
|
Change in the fair
value of derivative instruments
|
|
|
(6.7)
|
16.8
|
|
|
(15.4)
|
(6.2)
|
Other (income)
expense
|
|
|
128.1
|
0.2
|
|
|
125.8
|
98.1
|
Project income
(loss)
|
|
|
($104.3)
|
$2.1
|
|
|
($41.4)
|
($38.9)
|
Administrative and
other expenses (income)
|
|
|
11.2
|
18.6
|
|
|
73.1
|
145.7
|
Income tax expense
(benefit)
|
|
|
(30.1)
|
(11.4)
|
|
|
(30.4)
|
(31.4)
|
Net income (loss)
from discontinued operations, net of tax
|
|
(1.3)
|
(7.3)
|
|
|
19.5
|
(29.0)
|
Net income
(loss)
|
|
|
($86.7)
|
($12.4)
|
|
|
($64.6)
|
($182.2)
|
Adjustments to
reconcile to net cash provided by operating activities
|
120.8
|
56.2
|
|
|
142.2
|
265.8
|
Change in other
operating balances
|
|
|
(14.5)
|
(24.8)
|
|
|
9.8
|
(18.6)
|
Cash flows from
operating activities
|
|
|
$19.7
|
$19.1
|
|
|
$87.4
|
$65.0
|
Term loan facility
repayments (1)
|
|
|
(11.7)
|
(11.3)
|
|
|
(68.3)
|
(58.4)
|
Project-level debt
repayments
|
|
|
(4.4)
|
(6.6)
|
|
|
(15.1)
|
(26.2)
|
Purchases of
property, plant and equipment (2)
|
|
|
(1.9)
|
(3.4)
|
|
|
(11.3)
|
(13.4)
|
Distributions to
noncontrolling interests (3)
|
|
|
-
|
(2.2)
|
|
|
(3.7)
|
(11.0)
|
Dividends on
preferred shares of a subsidiary company
|
|
|
(2.1)
|
(2.8)
|
|
|
(8.8)
|
(11.6)
|
Free Cash
Flow
|
|
|
($0.4)
|
($7.2)
|
|
|
($19.8)
|
($55.6)
|
Additional GAAP cash
flow measures:
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities
|
|
|
($2.7)
|
($7.7)
|
|
|
$320.9
|
$68.7
|
Cash flows from
financing activities
|
|
|
($21.0)
|
($69.1)
|
|
|
($445.8)
|
($182.4)
|
(1)
Includes mandatory 1% annual amortization and 50% excess cash flow
repayments by the Partnership.
|
|
(2)
Excludes construction costs related to the Company's Canadian Hills
project in 2014.
|
|
|
|
(3)
Distributions to noncontrolling interests include distributions to
the tax equity investors at Canadian Hills and to the other 50%
owner of Rockland. These projects were sold in June
2015.
|
|
Note: This table
presents Cash Distributions from Projects, Project Adjusted EBITDA
and Free Cash Flow, which are not recognized measures under GAAP
and do not have any standardized meanings prescribed by GAAP;
therefore, these measures may not be comparable to similar measures
presented by other companies.
|
Atlantic Power
Corporation
|
|
Table 11A –
Adjusted Cash Flows from Operating Activities and Adjusted Free
Cash Flow (in millions of U.S. dollars)
|
Three months ended
December 31, 2015 and 2014
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
December 31,
2015
|
|
|
Three months
ended
December 31,
2014
|
|
|
|
Continuing
Operations
|
Discontinued
Operations
|
Total
|
|
|
Continuing
Operations
|
Discontinued
Operations
|
Total
|
Project Adjusted
EBITDA
|
|
|
$50.4
|
$-
|
$50.4
|
|
|
$56.9
|
$20.7
|
$77.6
|
Adjustment for equity
method projects (1)
|
|
6.0
|
-
|
6.0
|
|
|
10.5
|
(2.9)
|
7.6
|
Corporate G&A
expense
|
|
|
(6.5)
|
-
|
(6.5)
|
|
|
(11.2)
|
-
|
(11.2)
|
Cash interest
payments
|
|
|
(20.6)
|
-
|
(20.6)
|
|
|
(39.4)
|
(4.8)
|
(44.2)
|
Cash taxes
|
|
|
(1.0)
|
(5.0)
|
(6.0)
|
|
|
(1.1)
|
-
|
(1.1)
|
Other, including
changes in working capital
|
|
(3.6)
|
-
|
(3.6)
|
|
|
(7.9)
|
(1.7)
|
(9.6)
|
Cash flows from
operating
activities
|
|
|
$24.7
|
($5.0)
|
$19.7
|
|
|
$7.8
|
$11.3
|
$19.1
|
Changes in other
operating balances
|
|
3.6
|
-
|
3.6
|
|
|
7.9
|
1.7
|
9.6
|
Severance
charges
|
|
|
-
|
-
|
-
|
|
|
0.9
|
-
|
0.9
|
Restructuring and
other charges
|
|
|
-
|
-
|
-
|
|
|
0.7
|
-
|
0.7
|
Shareholder
litigation expenses
|
|
|
-
|
-
|
-
|
|
|
0.6
|
-
|
0.6
|
Refinancing
transaction costs (Q1 2014)
|
|
1.0
|
-
|
1.0
|
|
|
-
|
-
|
-
|
Debt redemption costs
(9.0% Notes)
|
|
-
|
-
|
-
|
|
|
-
|
-
|
-
|
Adjusted Cash
Flows from Operating Activities
|
$29.3
|
($5.0)
|
$24.3
|
|
|
$17.9
|
$13.0
|
$30.9
|
Term loan facility
repayments (2)
|
|
|
(11.7)
|
-
|
(11.7)
|
|
|
(11.3)
|
-
|
(11.3)
|
Project-level debt
repayments
|
|
|
(4.4)
|
-
|
(4.4)
|
|
|
(3.7)
|
(2.9)
|
(6.6)
|
Purchases of
property, plant and equipment (3)
|
(1.9)
|
-
|
(1.9)
|
|
|
(1.5)
|
(1.9)
|
(3.4)
|
Distributions to
noncontrolling interests (4)
|
|
-
|
-
|
-
|
|
|
-
|
(2.2)
|
(2.2)
|
Dividends on
preferred shares of a subsidiary company
|
(2.1)
|
-
|
(2.1)
|
|
|
(2.8)
|
-
|
(2.8)
|
Adjusted Free Cash
Flow
|
|
|
$9.2
|
($5.0)
|
$4.2
|
|
|
($1.4)
|
$6.0
|
$4.6
|
Additional GAAP cash
flow measures:
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities
|
|
(2.7)
|
-
|
(2.7)
|
|
|
(5.5)
|
(2.2)
|
(7.7)
|
Cash flows from
financing activities
|
|
(21.0)
|
-
|
(21.0)
|
|
|
(59.8)
|
(9.3)
|
(69.1)
|
(1)
Represents difference between Project Adjusted EBITDA and cash
distributions from equity method projects.
|
|
(2)
Includes 1% mandatory annual amortization and 50% excess cash flow
repayments by the Partnership.
|
(3)
Excludes construction costs related to the Company's Canadian Hills
project in 2014.
|
(4)
Distributions to noncontrolling interests primarily include
distributions, if any, to the tax equity investors at Canadian
Hills and to the other 50% owner of Rockland. These projects were
sold in June 2015.
|
Note: This table
presents Project Adjusted EBITDA, Adjusted Cash Flows from
Operating Activities and Adjusted Free Cash Flow, which are not
recognized measures under GAAP and do not have any standardized
meanings prescribed by GAAP; therefore, these measures may not be
comparable to similar measures presented by other
companies.
|
Atlantic Power
Corporation
|
|
|
|
|
Table 11B –
Adjusted Cash Flows from Operating Activities and Adjusted Free
Cash Flow (in millions of U.S. dollars)
|
Twelve months
ended December 31, 2015 and 2014 (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve months
ended
December 31,
2015
|
|
|
Twelve months
ended
December 31,
2014
|
|
|
|
Continuing
Operations
|
Discontinued
Operations
|
Total
|
|
|
Continuing
Operations
|
Discontinued
Operations
|
Total
|
Project Adjusted
EBITDA
|
|
|
$208.9
|
$28.1
|
$237.0
|
|
|
$229.4
|
$69.8
|
$299.2
|
Adjustment for equity
method projects (1)
|
|
2.2
|
(2.7)
|
(0.5)
|
|
|
(0.8)
|
(6.1)
|
(6.9)
|
Corporate G&A
expense
|
|
|
(29.4)
|
-
|
(29.4)
|
|
|
(37.9)
|
-
|
(37.9)
|
Cash interest
payments
|
|
|
(98.3)
|
(1.5)
|
(99.8)
|
|
|
(154.9)
|
(13.8)
|
(168.7)
|
Cash taxes
|
|
|
(3.9)
|
(6.2)
|
(10.1)
|
|
|
(2.1)
|
-
|
(2.1)
|
Other, including
changes in working capital
|
(7.8)
|
(2.0)
|
(9.8)
|
|
|
(17.0)
|
(1.6)
|
(18.6)
|
Cash flows from
operating activities
|
$71.7
|
$15.7
|
$87.4
|
|
|
$16.7
|
$48.3
|
$65.0
|
Changes in other
operating balances
|
|
7.8
|
2.0
|
9.8
|
|
|
17.0
|
1.6
|
18.6
|
Severance
charges
|
|
|
3.9
|
-
|
3.9
|
|
|
6.1
|
-
|
6.1
|
Restructuring and
other charges
|
|
|
0.6
|
-
|
0.6
|
|
|
1.7
|
-
|
1.7
|
Shareholder
litigation expenses
|
|
|
0.6
|
-
|
0.6
|
|
|
1.4
|
-
|
1.4
|
Refinancing
transaction costs (Q1 2014)
|
|
1.1
|
-
|
1.1
|
|
|
49.4
|
-
|
49.4
|
Debt redemption costs
(9.0% Notes) (Q3 2015)
|
|
19.5
|
-
|
19.5
|
|
|
-
|
-
|
-
|
Adjusted Cash
Flows from Operating
Activities
|
|
$105.3
|
$17.7
|
$123.0
|
|
|
$92.4
|
$49.9
|
$142.3
|
Term loan facility
repayments (2)
|
|
|
(68.3)
|
-
|
(68.3)
|
|
|
(58.4)
|
-
|
(58.4)
|
Project-level debt
repayments(3)
|
|
|
(15.1)
|
-
|
(15.1)
|
|
|
(11.7)
|
(6.4)
|
(18.1)
|
Purchases of
property, plant and equipment (4)
|
(11.3)
|
-
|
(11.3)
|
|
|
(11.1)
|
(2.3)
|
(13.4)
|
Distributions to
noncontrolling interests (5)
|
|
-
|
(3.7)
|
(3.7)
|
|
|
-
|
(11.0)
|
(11.0)
|
Dividends on
preferred shares of a subsidiary company
|
(8.8)
|
-
|
(8.8)
|
|
|
(11.6)
|
-
|
(11.6)
|
Adjusted Free Cash
Flow
|
|
|
$1.8
|
$14.0
|
$15.8
|
|
|
($0.3)
|
$30.2
|
$29.9
|
Additional GAAP cash
flow measures:
|
|
|
|
|
|
|
|
|
|
Cash flows from
investing activities
|
|
|
$333.7
|
($12.8)
|
$320.9
|
|
|
$73.5
|
($4.8)
|
$68.7
|
Cash flows from
financing activities
|
|
|
($432.8)
|
($13.0)
|
($445.8)
|
|
|
($131.6)
|
($50.8)
|
($182.4)
|
(1)
Represents difference between Project Adjusted EBITDA and cash
distributions from equity method projects.
|
|
(2)
Includes 1% mandatory annual amortization and 50% excess cash flow
repayments by the Partnership.
|
(3)
Excludes $8.1 million principal repayment at Piedmont on term loan
conversion (February 2014).
|
(4)
Excludes construction costs related to the Company's Canadian Hills
project in 2014.
|
(5)
Distributions to noncontrolling interests primarily include
distributions, if any, to the tax equity investors at Canadian
Hills and to the other 50% owner of Rockland. These projects were
sold in June 2015.
|
Note: This table
presents Project Adjusted EBITDA, Adjusted Cash Flows from
Operating Activities and Adjusted Free Cash Flow, which are not
recognized measures under GAAP and do not have any standardized
meanings prescribed by GAAP; therefore, these measures may not be
comparable to similar measures presented by other
companies.
|
Atlantic Power
Corporation
|
|
|
Table 12 – Project
Adjusted EBITDA by Project (for Selected
Projects)
|
|
|
|
(in millions of
U.S. dollars)
|
|
|
|
Unaudited
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
December
31,
|
|
Twelve months
ended
December
31,
|
|
|
|
2015
|
2014
|
|
2015
|
2014
|
East
U.S.
|
Accounting
|
|
|
|
|
|
|
Cadillac
|
Consolidated
|
$2.7
|
$2.3
|
|
$8.8
|
$7.7
|
Curtis
Palmer
|
Consolidated
|
8.9
|
7.3
|
|
29.8
|
31.5
|
Morris
|
Consolidated
|
3.2
|
3.1
|
|
16.5
|
12.7
|
Piedmont
|
Consolidated
|
(0.1)
|
2.5
|
|
7.6
|
6.7
|
Other
(1)
|
Consolidated
|
0.8
|
0.5
|
|
3.2
|
3.7
|
Chambers
|
Equity
method
|
3.3
|
4.5
|
|
17.0
|
18.6
|
Orlando
|
Equity
method
|
5.4
|
5.4
|
|
22.0
|
15.4
|
Other
(2)
|
Equity
method
|
(0.2)
|
(1.4)
|
|
0.1
|
10.3
|
Total
|
|
|
23.8
|
24.1
|
|
104.8
|
106.4
|
West
U.S.
|
|
|
|
|
|
|
|
Manchief
|
Consolidated
|
3.4
|
4.0
|
|
5.8
|
15.0
|
Naval
Station
|
Consolidated
|
1.3
|
1.2
|
|
10.2
|
10.3
|
North
Island
|
Consolidated
|
1.4
|
1.1
|
|
8.4
|
5.4
|
Other
(3)
|
Consolidated
|
0.2
|
(0.6)
|
|
9.2
|
9.1
|
Frederickson
|
Equity
method
|
3.3
|
3.3
|
|
12.5
|
12.2
|
Other
(4)
|
Equity
method
|
0.2
|
0.4
|
|
0.8
|
2.2
|
Total
|
|
|
9.8
|
9.4
|
|
46.9
|
54.2
|
Canada
|
|
|
|
|
|
|
|
Calstock
|
Consolidated
|
2.5
|
2.9
|
|
9.5
|
6.8
|
Kapuskasing
|
Consolidated
|
3.7
|
3.1
|
|
7.8
|
9.2
|
Nipigon
|
Consolidated
|
5.2
|
5.2
|
|
18.3
|
15.3
|
North Bay
|
Consolidated
|
3.6
|
3.6
|
|
7.2
|
10.5
|
Williams
Lake
|
Consolidated
|
1.5
|
3.2
|
|
14.0
|
15.8
|
Other
(5)
|
Consolidated
|
0.2
|
6.7
|
|
2.9
|
18.7
|
Total
|
|
|
16.7
|
24.7
|
|
59.7
|
76.3
|
Totals
|
|
|
|
|
|
|
|
Consolidated
projects
|
|
|
38.4
|
46.0
|
|
159.1
|
178.4
|
Equity method
projects
|
|
|
11.9
|
12.1
|
|
52.3
|
58.6
|
Un-allocated
corporate
|
|
|
0.1
|
(1.3)
|
|
(2.5)
|
(7.5)
|
Total Project
Adjusted EBITDA
|
|
|
$50.4
|
$56.9
|
|
$208.9
|
$229.4
|
|
|
|
|
|
|
|
|
Reconciliation to
project income (loss)
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
|
|
$31.2
|
$35.3
|
|
$130.1
|
$155.9
|
Interest expense,
net
|
|
|
2.1
|
2.4
|
|
9.8
|
20.5
|
Change in the fair
value of derivative instruments
|
|
(6.7)
|
16.8
|
|
(15.4)
|
(6.2)
|
Impairment and other
expense
|
|
|
128.1
|
0.2
|
|
125.8
|
98.1
|
Project income
(loss)
|
|
|
($104.3)
|
$2.1
|
|
($41.4)
|
($38.9)
|
(1)
Kenilworth
|
|
|
|
|
|
|
|
(2)
Selkirk
|
|
|
|
|
|
|
|
(3) Naval
Training Station and Oxnard
|
|
|
|
|
|
|
|
(4) Q4
2014: Koma Kulshan; FY 2014: Koma Kulshan and Delta-Person;
Q4 and FY 2015: Koma Kulshan
|
|
(5) Tunis,
Moresby Lake and Mamquam
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes: Table 12
presents Project Adjusted EBITDA, which is not a recognized measure
under GAAP and does not have any standardized meaning prescribed by
GAAP; therefore, this measure may not be comparable to a similar
measure presented by other companies. The Company has not
reconciled non-GAAP financial measures relating to individual
projects to the directly comparable GAAP measures due to the
difficulty in making the relevant adjustments on an individual
project basis.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/atlantic-power-corporation-releases-fourth-quarter-and-year-end-2015-results-300232049.html
SOURCE Atlantic Power Corporation