Welcome!

News Feed Item

CORRECTION: Capital Power Reports Second Quarter 2014 Results and Announces a 7.9% Dividend Increase for Its Common Shares

EDMONTON, ALBERTA -- (Marketwired) -- 07/25/14 -- Capital Power Corporation (Capital Power, or the Company) (TSX: CPX) today released its financial results for the second quarter ended June 30, 2014. The Company also announced that its Board of Directors has approved a 7.9% dividend increase for its common shares. Accordingly, effective for the third quarter 2014 dividend payment, the quarterly dividend will increase from $0.315 to $0.34 per common share, representing an annualized dividend rate of $1.36 per share.

Normalized earnings attributable to common shareholders in the second quarter of 2014, after adjusting for one-time items and fair value adjustments, were $6 million, or $0.07 per share, compared with $19 million, or $0.27 per share, in the comparable period of 2013.

Net income attributable to shareholders in the second quarter of 2014 was $20 million, or $0.17 per share, compared with $20 million, or $0.20 per share, in the comparable period of 2013. Funds from operations were $85 million for both the second quarter of 2014 and the second quarter of 2013.

For the six months ended June 30, 2014, normalized earnings attributable to common shareholders were $32 million, or $0.39 per share, compared with $44 million, or $0.63 per share, in the first six months of 2013. Funds from operations totaled $177 million compared with $191 million in the comparable six-month period last year.

"Second quarter financial performance was impacted by seasonally low Alberta power prices, lower generation from the acquired Sundance PPA, and lower generation at Genesee 3 caused by transmission constraints," said Brian Vaasjo, President and CEO of Capital Power. "Alberta power prices have averaged $51 per megawatt hour in the first six months of 2014 compared to our original full year forecast of $57 per megawatt hour. With the expected output from our commercial plants fully hedged for the remainder of the year, we expect funds from operations in 2014, including the $20 million received for the amendment of the Genesee Coal Mine Agreements, to be in the middle of our annual financial target range of $360 to $400 million."

"While we are disappointed with this quarter's financial performance, the fundamentals of our business and the additions to our solid asset base continue to strengthen the outlook for the Company," said Mr. Vaasjo. "Capital Power's contracted cash flow base has grown significantly since 2012 with the addition of three contracted wind facilities to our fleet. In addition, the Shepard Energy Centre is expected to begin first fire in early August and the facility is on track to begin commercial operations in early 2015. Seventy-five per cent of our generation from the Shepard facility is contracted for the first 3 years and 50% is contracted from 2018 to 2034. Combined with the expected completion of the K2 Wind project in Ontario later next year, we are forecasting a substantial expansion in our contracted operating margin. Based on this strong cash flow base, I am pleased to announce that the Board of Directors has approved a 7.9% dividend increase."

"With our growing contracted cash flow base and the increasing demand for Alberta power, we are well positioned to continue to grow our cash flows, allowing us to reinvest in growth opportunities such as the Genesee 4 and 5 project, and consistently grow our dividends. We believe both are critical components to delivering long-term shareholder value," continued Mr. Vaasjo.


----------------------------------------------------------------------------
Operational and Financial
 Highlights (1 )                  Three months ended     Six months ended
(unaudited)                             June 30               June 30
----------------------------------------------------------------------------
(millions of dollars except per
 share and operational amounts)        2014       2013       2014       2013
----------------------------------------------------------------------------
Electricity generation
 (excluding acquired Sundance
 PPA) (GWh)                           2,711      3,746      5,952      7,888
----------------------------------------------------------------------------
Generation plant availability
 (excluding acquired Sundance
 PPA) (%)                               92%        86%        94%        90%
----------------------------------------------------------------------------
Revenues                          $     240  $     321  $     548  $     686
----------------------------------------------------------------------------
Adjusted EBITDA (2)               $      78  $     104  $     191  $     239
----------------------------------------------------------------------------
Net income                        $      21  $      23  $      59  $      71
----------------------------------------------------------------------------
Net income attributable to
 shareholders of the Company      $      20  $      20  $      52  $      54
----------------------------------------------------------------------------
Normalized earnings attributable
 to common shareholders (2)       $       6  $      19  $      32  $      44
----------------------------------------------------------------------------
Basic earnings per share          $    0.17  $    0.20  $    0.50  $    0.64
----------------------------------------------------------------------------
Diluted earnings per share        $    0.17  $    0.19  $    0.50  $    0.63
----------------------------------------------------------------------------
Normalized earnings per share
 (2)                              $    0.07  $    0.27  $    0.39  $    0.63
----------------------------------------------------------------------------
Funds from operations (2 )        $      85  $      85  $     177  $     191
----------------------------------------------------------------------------
Purchase of property, plant and
 equipment and other assets       $      63  $     169  $     138  $     462
----------------------------------------------------------------------------
Dividends per common share,
 declared                         $  0.3150  $  0.3150  $  0.6300  $  0.6300
----------------------------------------------------------------------------

1.  The operational and financial highlights in this press release should be
    read in conjunction with Management's Discussion and Analysis and the
    audited Consolidated Financial Statements for the six months ended June
    30, 2014.
2.  Earnings before finance expense, income tax expense, depreciation and
    amortization, impairments, foreign exchange losses, and gains on
    disposals (adjusted EBITDA), normalized earnings attributable to common
    shareholders, normalized earnings per share, and funds from operations
    are non-GAAP financial measures and do not have standardized meanings
    under GAAP and are, therefore, unlikely to be comparable to similar
    measures used by other enterprises. See Non-GAAP Financial Measures.

Significant Events

Dividend increase

On July 25, 2014, the Company announced that its Board of Directors approved a 7.9% increase of the annual dividend for holders of its common shares, from $1.26 per common share to $1.36 per common share. This increased common dividend will commence with the third quarter 2014 quarterly dividend payment payable on October 31, 2014 to shareholders of record at the close of business on September 30, 2014.

Genesee coal mine

Capital Power is a party to various agreements with Prairie Mines & Minerals Royalty Ltd. (PMRL) in relation to the operations of the Genesee coal mine (Genesee Coal Mine Agreements). Pursuant to the Genesee Coal Mine Agreements, PMRL operates the Genesee coal mine. In connection with the acquisition by Westmoreland Coal Company (Westmoreland) of PMRL and the acquisition by Altius Minerals Corporation (Altius) of the royalty assets of PMRL, the Genesee Coal Mine Agreements and certain related agreements have, amongst other things, been amended to: (a) confirm the acquisitions by Westmoreland and Altius; (b) provide for certain amendments to the Genesee Coal Mine Agreements; and (c) provide for a payment to Capital Power of $20 million upon completion of the acquisitions, which payment was received.

Genesee 4 and 5

On April 24, 2014, Capital Power and ENMAX Corporation (ENMAX) executed a purchase and sale agreement in support of a joint arrangement agreement to jointly develop, construct, and operate the Genesee 4 and 5 power project. The joint arrangement agreement will provide provisions for, among other things, an agreement for ENMAX to purchase approximately 225 MW from Capital Power for eight years. The joint arrangement agreement closing occurred in July 2014.

Construction of K2 Wind Power Project commences

On March 24, 2014, construction of the K2 Wind Power Project (K2 Wind) commenced following the successful completion of an $850 million financing in the form of a construction loan that will convert to long-term project debt once K2 Wind starts commercial operations. K2 Wind is a 270 megawatt (MW) wind power project located in Goderich, Ontario that is under joint development by Samsung Renewable Energy, Inc., Pattern Energy Group LP and Capital Power with operations expected to commence in the second half of 2015. The total estimated project cost has been revised upward to $930 million from the previous upper end of range of $900 million primarily due to foreign exchange changes on U.S. contract deliverables. Capital Power's share is $310 million. As a higher portion of the project is expected to be financed with project debt than originally forecast, Capital Power expects higher equity returns on the project.

Analyst Conference Call and Webcast

Capital Power will be hosting a conference call and live webcast with analysts on July 28, 2014 at 11:00 AM (Eastern Time) to discuss the second quarter results. The conference call dial-in numbers are:

(604) 681-8564 (Vancouver)

(403) 532-5601 (Calgary)

(416) 623-0333 (Toronto)

(514) 687-4017 (Montreal)

(855) 353-9183 (toll-free from Canada and USA)

Participant access code for the call: 21543#

A replay of the conference call will be available following the call at: (855) 201-2300 (toll-free) and entering conference reference number 1159793# followed by participant code 21543#. The replay will be available until midnight on October 28, 2014.

Interested parties may also access the live webcast on the Company's website at www.capitalpower.com with an archive of the webcast available following the conference call.

Non-GAAP Financial Measures

The Company uses (i) adjusted EBITDA, (ii) funds from operations, (iii) normalized earnings attributable to common shareholders, and (iv) normalized earnings per share as financial performance measures. These terms are not defined financial measures according to GAAP and do not have standardized meanings prescribed by GAAP, and are, therefore, unlikely to be comparable to similar measures used by other enterprises. These measures should not be considered alternatives to gross income, net income, net income attributable of shareholders of the Company, net cash flows from operating activities or other measures of financial performance calculated in accordance with GAAP. Rather, these measures are provided to complement GAAP measures in the analysis of the Company's results of operations from management's perspective. Reconciliations of adjusted EBITDA to gross income, operating income and net income, funds from operations to net cash flows from operating activities and normalized earnings attributable to common shareholders to net income attributable to shareholders of the Company are contained in the Company's Management's Discussion and Analysis dated July 25, 2014 for the six months ended June 30, 2014 which is available under the Company's profile on SEDAR at www.SEDAR.com.

Forward-looking Information

Forward-looking information or statements included in this press release are provided to inform the Company's shareholders and potential investors about management's assessment of Capital Power's future plans and operations. This information may not be appropriate for other purposes. The forward-looking information in this press release is generally identified by words such as will, anticipate, believe, plan, intend, target, and expect or similar words that suggest future outcomes.

Material forward-looking information in this press release includes information with respect to expectations regarding: (i) future cash flows including contracted base, dividend growth, and reinvestment, and (ii) completion of capital projects.

These statements are based on certain assumptions and analyses made by the Company in light of its experience and perception of historical trends, current conditions and expected future developments, and other factors it believes are appropriate. The material factors and assumptions used to develop these forward-looking statements relate to: (i) electricity and other energy prices, (ii) performance, (iii) business prospects and opportunities including expected growth and capital projects, (iv) status and impact of policy, legislation and regulation, and (v) effective tax rates.

Whether actual results, performance or achievements will conform to the Company's expectations and predictions is subject to a number of known and unknown risks and uncertainties which could cause actual results and experience to differ materially from the Company's expectations. Such material risks and uncertainties are: (i) changes in electricity prices in markets in which the Company operates, (ii) changes in energy commodity market prices and use of derivatives, (iii) regulatory and political environments including changes to environmental, financial reporting and tax legislation, (iv) power plant availability and performance including maintenance expenditures, (v) ability to fund current and future capital and working capital needs, (vi) acquisitions and developments including timing and costs of regulatory approvals and construction, (vii) changes in market prices and availability of fuel, and (viii) changes in general economic and competitive conditions. See Risks and Risk Management in the Company's December 31, 2013 annual Management's Discussion and Analysis for further discussion of these and other risks.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
SYS-CON Events announced today that ReadyTalk, a leading provider of online conferencing and webinar services, has been named Vendor Presentation Sponsor at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. ReadyTalk delivers audio and web conferencing services that inspire collaboration and enable the Future of Work for today’s increasingly digital and mobile workforce. By combining intuitive, innovative tec...
Major trends and emerging technologies – from virtual reality and IoT, to Big Data and algorithms – are helping organizations innovate in the digital era. However, to create real business value, IT must think beyond the ‘what’ of digital transformation to the ‘how’ to harness emerging trends, innovation and disruption. Architecture is the key that underpins and ties all these efforts together. In the digital age, it’s important to invest in architecture, extend the enterprise footprint to the cl...
Fifty billion connected devices and still no winning protocols standards. HTTP, WebSockets, MQTT, and CoAP seem to be leading in the IoT protocol race at the moment but many more protocols are getting introduced on a regular basis. Each protocol has its pros and cons depending on the nature of the communications. Does there really need to be only one protocol to rule them all? Of course not. In his session at @ThingsExpo, Chris Matthieu, co-founder and CTO of Octoblu, walk you through how Oct...
SYS-CON Events announced today that Secure Channels will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. The bedrock of Secure Channels Technology is a uniquely modified and enhanced process based on superencipherment. Superencipherment is the process of encrypting an already encrypted message one or more times, either using the same or a different algorithm.
Vidyo, Inc., has joined the Alliance for Open Media. The Alliance for Open Media is a non-profit organization working to define and develop media technologies that address the need for an open standard for video compression and delivery over the web. As a member of the Alliance, Vidyo will collaborate with industry leaders in pursuit of an open and royalty-free AOMedia Video codec, AV1. Vidyo’s contributions to the organization will bring to bear its long history of expertise in codec technolo...
Traditional on-premises data centers have long been the domain of modern data platforms like Apache Hadoop, meaning companies who build their business on public cloud were challenged to run Big Data processing and analytics at scale. But recent advancements in Hadoop performance, security, and most importantly cloud-native integrations, are giving organizations the ability to truly gain value from all their data. In his session at 19th Cloud Expo, David Tishgart, Director of Product Marketing ...
SYS-CON Events announced today that Bsquare has been named “Silver Sponsor” of SYS-CON's @ThingsExpo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. For more than two decades, Bsquare has helped its customers extract business value from a broad array of physical assets by making them intelligent, connecting them, and using the data they generate to optimize business processes.
If you’re responsible for an application that depends on the data or functionality of various IoT endpoints – either sensors or devices – your brand reputation depends on the security, reliability, and compliance of its many integrated parts. If your application fails to deliver the expected business results, your customers and partners won't care if that failure stems from the code you developed or from a component that you integrated. What can you do to ensure that the endpoints work as expect...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, provided an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life sett...
Digitization is driving a fundamental change in society that is transforming the way businesses work with their customers, their supply chains and their people. Digital transformation leverages DevOps best practices, such as Agile Parallel Development, Continuous Delivery and Agile Operations to capitalize on opportunities and create competitive differentiation in the application economy. However, information security has been notably absent from the DevOps movement. Speed doesn’t have to negat...
The Transparent Cloud-computing Consortium (abbreviation: T-Cloud Consortium) will conduct research activities into changes in the computing model as a result of collaboration between "device" and "cloud" and the creation of new value and markets through organic data processing High speed and high quality networks, and dramatic improvements in computer processing capabilities, have greatly changed the nature of applications and made the storing and processing of data on the network commonplace.
Your business relies on your applications and your employees to stay in business. Whether you develop apps or manage business critical apps that help fuel your business, what happens when users experience sluggish performance? You and all technical teams across the organization – application, network, operations, among others, as well as, those outside the organization, like ISPs and third-party providers – are called in to solve the problem.
Cognitive Computing is becoming the foundation for a new generation of solutions that have the potential to transform business. Unlike traditional approaches to building solutions, a cognitive computing approach allows the data to help determine the way applications are designed. This contrasts with conventional software development that begins with defining logic based on the current way a business operates. In her session at 18th Cloud Expo, Judith S. Hurwitz, President and CEO of Hurwitz & ...
The vision of a connected smart home is becoming reality with the application of integrated wireless technologies in devices and appliances. The use of standardized and TCP/IP networked wireless technologies in line-powered and battery operated sensors and controls has led to the adoption of radios in the 2.4GHz band, including Wi-Fi, BT/BLE and 802.15.4 applied ZigBee and Thread. This is driving the need for robust wireless coexistence for multiple radios to ensure throughput performance and th...
Enterprise IT has been in the era of Hybrid Cloud for some time now. But it seems most conversations about Hybrid are focused on integrating AWS, Microsoft Azure, or Google ECM into existing on-premises systems. Where is all the Private Cloud? What do technology providers need to do to make their offerings more compelling? How should enterprise IT executives and buyers define their focus, needs, and roadmap, and communicate that clearly to the providers?