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Press release from CNW Group

Boralex posts stronger financial performance in 2011

Tuesday, February 21, 2012

Boralex posts stronger financial performance in 201107:00 EST Tuesday, February 21, 2012MONTREAL, Feb. 21, 2012 /CNW Telbec/ - Boralex Inc. ("Boralex" or the "Corporation") ended fiscal 2011 with a sharp rise in earnings before interest, taxes, depreciation and amortization ("EBITDA"), totalling $100.8 million compared with $39.4 million in 2010. This rise resulted primarily from the positive impact of consolidating the operations of Boralex Power Income Fund (the "Fund") and growth in the wind and solar power segments, which contributed $38.2 million and $18.9 million respectively, in additional EBITDA."Boralex's savvy strategic development choices in 2011 delivered results once again. We're convinced that our asset performance combined with the recent transactions will underpin growth and profitability for years to come," said Boralex President and CEO Patrick Lemaire.(in millions of Canadian dollars, except per share amounts and EBITDA margin) Three-month periodsended December 31 Twelve-month periodsended December 31 20112010 20112010      Revenues from energy sales56.553.7 194.0102.8EBITDA30.328.1 100.839.4EBITDA margin53.6%52.2% 51.9%38.3%Net earnings*8.23.1 2.935.1 Per share (basic and diluted)$0.22$0.08 $0.08$0.93Cash flows from operations17.615.7 54.214.8 Per share (basic and diluted)0.470.42 1.440.39*attributable to shareholders of BoralexDuring fiscal 2011, revenues from energy sales amounted to $194.0 million, up from $102.8 million in 2010. This marked revenue growth stemmed mainly from assets acquired from the Fund at the end of 2010 being fully consolidated in Boralex's 2011 results and the full-year contribution of new wind farms commissioned in 2010, as well as the commissioning of the solar power station in June 2011.Boralex recorded net earnings attributable to shareholders of $2.9 million in 2011, which when increased by $4.6 million compared with 2010, excluding a $36.8 million extraordinary gain recorded in 2010 on the acquisition of the Fund.All three segments—wind, hydroelectric and solar—drove revenue, EBIDTA and EBITDA margin growth for the Corporation in 2011. Boralex generated significantly improved results in its wind power segment in 2011, with revenue and EBITDA rising over 45%. In the hydroelectric segment, revenues and EBITDA were up roughly 115%.For the three-month period ended December 31, 2011, revenues from energy sales and EBITDA totalled $56.5 million and $30.3 million, respectively, up from $53.7 million and $28.1 million, for the same quarter of 2010. These improvements resulted from the wind power segment's full contribution and the fact that the quarter saw more favourable weather conditions for our French wind farms than in same period of 2010.In the fourth quarter of 2011, Boralex sold its U.S. wood-residue power stations—with an installed capacity of 186 MW—for a consideration of US$86.8 million. This transaction was in line with the strategic direction adopted by Boralex. The Corporation opted to focus its operations and development initiatives primarily on acquiring and operating renewable energy assets covered by long-term power sales contracts with indexed pricing. These assets now account for 96% of the Corporation's portfolio.Note that the sale of the Dolbeau thermal power station in the last quarter of 2011 triggered a pre-tax impairment reversal of $5.0 million.With approximately $160 million in cash resources at the end of 2011, Boralex has sufficient funds to develop the projects identified in its three-year growth strategy.About BoralexBoralex is a power producer whose core business dedicated to the development and the operation of renewable energy power stations. Currently, the Corporation operates an asset base with an installed capacity of nearly 500 MW in Canada, the Northeastern United States and France. Boralex is also committed under power development projects, both independently and with European and Canadian partners, to add approximately 400 MW of power. With more than 200 employees, Boralex is known for its diversified expertise and in-depth experience in four power generation types — wind, hydroelectric, thermal and more recently, solar.Boralex's shares and convertible debentures are listed on the Toronto Stock Exchange under the ticker symbols BLX and BLX.DB, respectively. More information is available at www.boralex.com or www.sedar.com.Certain statements in this release, including statements regarding future results and performance, are forward-looking statements based on current expectations. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those projected, including, but not limited to, the general impact of economic conditions, raw material price increases and availability, currency fluctuations, volatility in electricity selling prices, the Corporation's financing capacity, adverse changes in general market conditions and regulations affecting the industry, as well as other factors listed in the Company's filings with the various securities commissions.There can be no assurance as to the materialization of the results, performance or achievements as expressed or implied by forward-looking statements. The reader is cautioned not to place undue reliance on such forward-looking statements. Unless required to do so under applicable securities legislation, Boralex management does not assume any obligation to update or revise forward-looking statements to reflect new information, future events or other changes.The summarized financial statements included in this press release also contain certain non-GAAP measures. To assess the performance of its assets and reporting segments, the Corporation uses EBITDA, EBITDA margin, cash flows from operations and cash flows from operations per share as performance measures, as defined in the accompanying financial statements. These non-GAAP measures do not have a standardized meaning prescribed under IFRS. As a result, these measures may not be comparable to similarly named measures used by other companies. Consolidated Statements of Financial Position  As atDecember 31,As atDecember 31,As atJanuary 1,(in thousands of Canadian dollars) (unaudited)201120102010ASSETS   Cash and cash equivalents144,70392,65037,821Restricted cash18,28815,924-Trade and other receivables50,50060,42039,632Inventories3,5739,1798,726Other current financial assets-769-Available-for-sale financial asset2,20823,251-Prepaid expenses2,1372,5162,537CURRENT ASSETS221,409204,70988,716    Property, plant and equipment643,047738,884412,707Energy sales contracts97,705103,99449,023Water rights111,844113,0154,146Goodwill38,06338,063-Other intangible assets5,28515,4328,363Investment in the Fund--45,729Interest in the Joint Venture45,266--Other non-current financial assets--7,297Other non-current assets14,23631,41036,815NON-CURRENT ASSETS955,4461,040,798564,080TOTAL ASSETS1,176,8551,245,507652,796LIABILITIES   Bank loans and overdraft-19512,291Trade and other payables34,20959,55831,798Current portion of debt26,65934,03324,273Current income tax liability10,7763,209283Other current financial liabilities29,757183-CURRENT LIABILITIES101,40197,17868,645    Non-current debt479,525479,546206,116Convertible debentures223,347220,824-Deferred income tax liability26,03166,45533,181Other non-current financial liabilities14,27310,8347,645Other non-current liabilities3,4002,981-NON-CURRENT LIABILITIES746,576780,640246,942TOTAL LIABILITIES847,977877,818315,587EQUITY   Equity attributable to shareholders321,764359,357330,178Non-controlling interests7,1148,3327,031TOTAL EQUITY328,878367,689337,209TOTAL LIABILITIES AND EQUITY1,176,8551,245,507652,796Consolidated Statements of Earnings  Three-month periodsended December 31,Twelve-month periodsended December 31,(in thousands of Canadian dollars, except per share amounts) (unaudited)2011201020112010REVENUES    Revenues from energy sales56,49253,733194,025102,812Management revenues from the Fund---4,437Other income167119680718 56,65953,852194,705107,967COSTS AND OTHER EXPENSES    Operating costs21,43721,28873,03842,171Administrative3,9723,87417,23815,026Development7996263,5234,213Management and operation of the Fund---3,995Amortization14,58313,22857,83331,383Impairment loss (reversal) on property, plant and equipment(5,000)-1,503-Impairment of goodwill-23,158-23,158Net gain on deemed disposal of investment in the Fund-948-(24,744)Other gains--(2,959)(774) 35,79163,122150,17694,428OPERATING INCOME 20,868(9,270)44,52913,539     Financing costs12,63910,97749,66423,850Foreign exchange loss (gain)2,386767(961)701Net loss on financial instruments498369972241     LOSS BEFORE THE FOLLOWING ITEMS5,345(21,383)(5,146)(11,253)     Share in earnings of the Fund---(3,148)Share in earnings of the Joint Venture(150)-(150)-Income taxes (recovery)1,277(24,639)(2,311)(38,016)     NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS 3,9183,256(2,985)23,615Net earnings from discontinued operations4,6513025,48911,658NET EARNINGS8,5693,5582,50435,273     NET EARNINGS ATTRIBUTABLE TO:     Shareholders of Boralex8,1873,0802,88335,072 Non-controlling interests382478(379)201NET EARNINGS 8,5693,5582,50435,273     NET EARNINGS (LOSS) ATTRIBUTABLE TO SHAREHOLDERS OF BORALEX:     Continuing operations3,5362,778(2,606)23,414 Discontinued operations4,6513025,48911,658 8,1873,0802,88335,072     NET EARNINGS (LOSS) PER SHARE (BASIC AND DILUTED) ATTRIBUTABLE TO SHAREHOLDERS OF BORALEX:     Continuing operations$0.10$0.07$(0.07)$0.62 Discontinued operations$0.12 0.01$0.15$0.31 $0.22$0.08$0.08$0.93Consolidated Statements of Comprehensive Income (Loss) Three-month periodsended December 31,Twelve-month periodsended December 31,(in thousands of Canadian dollars) (unaudited)  2011201020112010NET EARNINGS  8,5693,5582,50435,273OTHER COMPREHENSIVE INCOME (LOSS)      Translation adjustments       Unrealized foreign exchange gain (loss) on translation of financial statements of self-sustaining foreign operations(4,849)(8,990)4,996(15,543) Taxes259(216)-(179)Cash flow hedges       Change in fair value of financial instruments(14,045)3,925(53,948)(14,470) Hedging items realized and recognized in net earnings2,2229696,0402,884 Hedging items realized and recognized in statement of financial position  -8041985,652 Taxes  2,397(1,898)13,4051,831Cash flow hedges - Joint Venture       Change in fair value of financial instruments(13,461)-(13,461)- Taxes3,579-3,579-Available-for-sale financial asset       Change in fair value of an available-for-sale financial asset(131)(727)(278)(727) Items realized and recognized in net earnings--(624)-Discontinued operations  99(1,904)(2,021)(2,998)Total other comprehensive loss  (23,930)(8,037)(42,114)(23,550)COMPREHENSIVE INCOME (LOSS)  (15,361)(4,479)(39,610)11,723COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO:       Shareholders of Boralex(14,978)(3,743)(38,392)12,711 Non-controlling interests(383)(736)(1,218)(988)COMPREHENSIVE INCOME (LOSS)  (15,361)(4,479)(39,610)11,723     COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO SHAREHOLDERS OF BORALEX:       Continuing operations(19,728)(2,141)(41,860)4,051 Discontinued operations4,750(1,602)3,4688,660 (14,978)(3,743)(38,392)12,711Consolidated Statements of Changes in Equity    2011 Equity attributable to shareholders  (in thousands of Canadian dollars) (unaudited)CapitalstockEquity component of convertible debenturesContributed surplusRetained earningsOther comprehensive lossTotalNon-controlling interestsTotal equityBalance as at January 1, 2011222,85314,4885,028141,693(24,705)359,3578,332367,689         Net earnings (loss)---2,883-2,883(379)2,504Other comprehensive loss----(41,275)(41,275)(839)(42,114)Comprehensive income (loss)---2,883(41,275)(38,392)(1,218)(39,610)         Conversion of convertible debentures258----258-258Share repurchase(353)--(75)-(428)-(428)Stock option expense--1,078--1,078-1,078Other-(109)---(109)-(109)Balance as at December 31, 2011222,75814,3796,106144,501(65,980)321,7647,114328,878   2010 Equity attributable to  shareholders  (in thousands of Canadian dollars) (unaudited)CapitalstockEquity component of convertible debenturesContributed surplusRetained earningsOther comprehensive lossTotalNon-controlling interestsTotal equityBalance as at January 1, 2010222,694-4,290105,538(2,344)330,1787,031337,209         Net earnings---35,072-35,07220135,273Other comprehensive loss----(22,361)(22,361)(1,189)(23,550)Comprehensive income (loss)---35,072(22,361)12,711(988)11,723         Conversion of convertible debentures26----26-26Options exercised133----133-133Excess of purchase price paid for acquisition of non-controlling interests---(2,332)-(2,332)42(2,290)Excess of proceeds from partial sale of a subsidiary---3,415-3,415-3,415Stock option expense--738--738-738Issuance of convertible debentures and imputed interest-14,488---14,488-14,488Contribution of non-controlling interest------2,2472,247Balance as at December 31, 2010222,85314,4885,028141,693(24,705)359,3578,332367,689Consolidated Statements of Cash Flows Three-month periodsended December 31,Twelve-month periodsended December 31,(in thousands of Canadian dollars) (unaudited)2011201020112010Net earnings attributable to shareholders of Boralex8,1873,0802,88335,072Less: Net earnings from discontinued operations4,6513025,48911,658Net earnings (loss) from continuing operations3,5362,778(2,606)23,414Distributions received from the Fund---4,475Financing costs12,63910,97749,66423,850Interest paid(13,358)(10,806)(47,134)(24,312)Income tax recovery1,277(24,639)(2,311)(38,016)Income taxes paid(39)11(4,337)(2,524)Non-cash items in earnings (loss):     Net loss on financial instruments498369972241 Share in earnings of the Joint Venture150-150- Share in earnings of the Fund---3,148 Amortization14,58313,22857,83331,383 Impairment loss (reversal) on property, plant and equipment(5,000)-1,503- Impairment of goodwill-23,158-23,158 Gain on sale of assets--(2,377)(774) Gain on sale of assets to the Joint Venture--(582)- Gain on deemed disposal of investment in the Fund---(30,874) Other3,3276093,4651,592 17,61315,68554,24014,761Change in non-cash items related to operating activities(13,082)(650)11,891(613)NET CASH FLOWS RELATED TO OPERATING ACTIVITIES4,53115,03566,13114,148     Additions to property, plant and equipment(5,517)(48,517)(34,419)(183,948)Change in restricted cash(17,011)19,098(2,364)(15,924)Business acquisition - the Fund---(38,811)Business acquisition - Other--(700)(2,142)Increase in interest in the Joint Venture(42,573)-(52,949)-Proceeds from sale of a subsidiary---878Change in reserve funds8-(2)883Development projects(439)(1,316)(1,620)(2,046)Proceeds from sale of asset2,150-4,200-Other(74)3743635NET CASH FLOWS RELATED TO INVESTING ACTIVITIES(63,456)(30,698)(87,418)(241,075)     Decrease in bank loans and overdraft6195(195)(12,096)Net increase in non-current debt6,4883,78039,674267,051Repayments on non-current debt(2,608)(6,533)(45,035)(73,608)Net issuance of convertible debentures---103,945Redemption of financial instruments prior to maturity(15,670)-(15,670)-Share repurchase--(428)-Net proceeds from share issuance-133-133Distributions paid to unit holders-(1,565)-(1,565)Repurchase of non-controlling interests - the Fund-(32,421)-(32,421)Repurchase of non-controlling interests - Other---(1,751)Increase in non-controlling interests---5,662Other(5)-(5)-NET CASH FLOWS RELATED TO FINANCING ACTIVITIES(11,789)(36,411)(21,659)255,350Cash from discontinued operations, including proceeds on disposal83,7095,83594,77030,679TRANSLATION ADJUSTMENT ON CASH AND CASH EQUIVALENTS(1,360)(1,843)229(4,273)NET INCREASE IN CASH AND CASH EQUIVALENTS11,635(48,082)52,05354,829CASH AND CASH EQUIVALENTS - BEGINNING OF YEAR133,068140,73292,65037,821CASH AND CASH EQUIVALENTS - END OF YEAR144,70392,650144,70392,650Segmented InformationThe Corporation's power stations are grouped into four distinct segments which represents the corporation segments—wind, hydroelectric, thermal and solar power station. The Corporation operates solely in power generation. The classification of these segments is based on the different cost structures relating to each of the four types of power stations. The same accounting rules are used for segmented information as apply to the consolidated accounts.Following the sale of its five U.S. wood-residue thermal power stations, the Corporation redefined its operating segments. Previously, operations were grouped into five distinct segments. Wood-residue thermal power stations and natural gas thermal power stations have been combined in a single segment called Thermal Power Stations. The comparative data have been adjusted to reflect this change. In addition, the data related to discontinued operations have been excluded as they are reported on a separate line in the Consolidated Statement of Earnings.The operating segments are presented according to the same criteria used to prepare the internal report submitted to the chief operating decision-maker, who allocates resources and assesses the performance do the operating segments. The chief operating decision-maker is considered to be the President and Chief Executive Officer, who assesses segment performance based on production of electricity, revenues from energy sales and EBITDA.EBITDA does not have a standardized meaning prescribed under IFRS; accordingly, it may not be comparable to similarly named measures used by other companies. Investors should not view EBITDA as an alternative measure to, for example, net earnings, or as a measure of operating results, which are IFRS measures.EBITDA is reconciled to the most comparable IFRS measure, namely, net earnings attributable to shareholders of Boralex, in the following table: Three-month periodsended December 31,Twelve-month periodsended December 31, 2011201020112010Net earnings attributable to shareholders of Boralex8,1873,0802,88335,072Net earnings from discontinued operations(4,651)(302)(5,489)(11,658)Non-controlling interests382478(379)201Income taxes (recovery)1,277(24,639)(2,311)(38,016)Net loss on financial instruments498369972241Foreign exchange loss (gain)2,386767(961)701Financing costs12,63910,97749,66423,850Other gains--(2,959)(774)Net gain on deemed disposal of investment in the Fund-948-(24,744)Impairment of goodwill-23,158-23,158Impairment loss (reversal) on property, plant and equipment(5,000)-1,503-Amortization14,58313,22857,83331,383EBITDA30,30128,064100,75639,414Investors should not consider cash flows from operations as an alternative measure to cash flows related to operating activities, which is an IFRS measure.Cash flows from operations are reconciled to the most comparable IFRS measure, namely, cash flows related to operating activities in the following table: Three-month periodsended December 31,Twelve-month periodsended December 31, 2011201020112010Net cash flows related to operating activities4,53115,03566,13114,148Less:    Change in non cash items related to operating activities(13,082)(650)11,891(613)CASH FLOWS FROM OPERATIONS17,61315,68554,24014,761Information by Operating Segment Three-month periodsended December 31,Twelve-month periodsended December 31, 2011201020112010Power production (MWh)    Wind power stations182,810143,379554,581377,392Hydroelectric power stations196,522220,380703,612328,290Thermal power stations114,225132,312469,835170,529Solar power station1,017-3,227- 494,574496,0711,731,255876,211Revenues from energy sales    Wind power stations22,46117,47967,25545,924Hydroelectric power stations15,98218,06056,31926,221Thermal power stations17,58418,19468,97530,667Solar power station465-1,476- 56,49253,733194,025102,812EBITDA    Wind power stations18,59014,10453,80736,263Hydroelectric power stations11,38614,40141,62318,929Thermal power stations4,1004,01920,6386,132Solar power station399-1,330-Corporate and eliminations(4,174)(4,460)(16,642)(21,910) 30,30128,064100,75639,414Additions to property, plant and equipment    Wind power stations19741,62412,291175,217Hydroelectric power stations2,4791043,7182,354Thermal power stations2841,7563,7651,766Solar power station1,8644,63613,4095,141Corporate and eliminations6933971,236(530) 5,51748,51734,419183,948 As atDecember 31,2011As atDecember 31,2010As atJanuary 1,2010Total assets   Wind power stations528,521531,424360,226Hydroelectric power stations366,099364,53434,019Thermal power stations101,683201,257167,223Solar power station23,5867,607-Corporate156,966140,68591,328 1,176,8551,245,507652,796Total liabilities   Wind power stations392,611437,972258,651Hydroelectric power stations143,439139,92229,499Thermal power stations29,58126,47615,778Solar power station21,0433,286-Corporate261,303270,16211,659 847,977877,818315,587Information by Geographic Segment Three-month periodsended December 31,Twelve-month periodsended December 31, 2011201020112010Power production (MWh)    Canada231,018241,853901,853356,025United States137,709146,590466,381225,045France125,847107,628363,021295,141 494,574496,0711,731,255876,211Revenues from energy sales    Canada26,84425,184102,40438,590United States10,52611,66635,14516,674France19,12216,88356,47647,548 56,49253,733194,025102,812EBITDA    Canada11,3839,48443,4944,914United States7,8359,34327,02911,111France11,0839,23730,23323,389 30,30128,064100,75639,414Additions to property, plant and equipment    Canada3,09134,83116,469107,076United States1672669731France2,25913,68417,28176,141 5,51748,51734,419183,948 As atDecember 31,2011As atDecember 31,2010As atJanuary 1,2010Total assets   Canada679,354633,804201,492United States209,003301,639181,125France288,498310,064270,179 1,176,8551,245,507652,796Non-current assets   Canada543,319529,727188,370United States156,631247,977131,089France255,496263,094244,621 955,4461,040,798564,080Total liabilities   Canada483,731495,23973,259United States122,827125,86932,956France241,419256,710209,372 847,977877,818315,587For further information: Media Andréan Gagné Communications Advisor Boralex Inc. 514-985-1353 andrean.gagne@boralex.com Investors Marc Jasmin Boralex Inc. 514-284-9868 marc.jasmin@boralex.com