INNERGEX REPORTS FIRST QUARTER 2024 RESULTS
Strategic Execution
- Secured 15-year 350 GWh per year PPA contract to supply clean energy to Codelco in
Chile - Advanced construction projects towards commissioning, including the 330 MW Boswell Springs wind project in
Wyoming - Subsequent to the quarter end, signed 30-year PPA with Hydro-
Québec for the 100 MW Lotbinière Ndakina wind project. PPA for the 300 MW Manicouagan wind project to be signed in Q2 2024 - Active share buyback program for a total cash consideration of
$7.6 million as atMay 7, 2024 - Reaffirming full year 2024 financial guidance
Q1 2024 Financial Results (compared to same period prior year results)
- Production Proportionate was at 96% of LTA, up from 87%
- Adjusted EBITDA Proportionate1 reached
$170.7 million , up 15% - Free Cash Flow per Share1 at
$1.19 for the trailing twelve-months endedMarch 31, 2024 , compared to$0.67 - Payout Ratio1 of 53% for the trailing twelve-months ended
March 31, 2024
All amounts are in thousands of Canadian dollars, unless otherwise indicated. |
"
FINANCIAL HIGHLIGHTS
|
Three months ended |
|
2024 |
2023 |
|
Production (MWh) |
2,522,980 |
2,312,655 |
Production as a percentage of LTA |
96 % |
87 % |
|
|
|
Revenues and Production Tax Credits |
242,535 |
218,328 |
Operating Income |
63,019 |
62,969 |
Adjusted EBITDA1 |
164,734 |
145,100 |
Net Loss |
(37,659) |
(13,036) |
Adjusted Net Loss1 |
(20,233) |
(12,029) |
Net Loss Attributable to Owners, $ per share - basic and diluted |
(0.21) |
(0.08) |
Production Proportionate (MWh)1 |
2,586,369 |
2,359,970 |
Revenues and Production Tax Credits Proportionate1 |
252,000 |
224,455 |
Adjusted EBITDA Proportionate1 |
170,685 |
148,443 |
|
|
|
|
Trailing twelve months ended |
|
|
2024 |
2023 |
Cash Flow from Operating Activities |
325,580 |
398,690 |
Free Cash Flow1,2 |
241,787 |
135,686 |
1. |
These measures are not recognized measures under IFRS and therefore may not be comparable to those presented by other issuers. Production and Production Proportionate are key performance indicators for the Corporation that cannot be reconciled with an IFRS measure. Please refer to the section NON-IFRS MEASURES for more information. |
2. |
For more information on the calculation and explanation, please refer to 4- CAPITAL AND LIQUIDITY | Free Cash Flow and Payout Ratio of the MD&A. |
FINANCIAL HIGHLIGHTS PER SEGMENT
|
|
Consolidated |
Proportionate1 |
||||
|
|
2024 |
2023 |
Change |
2024 |
2023 |
Change |
|
|
|
|
|
|
|
|
Revenues and Production Tax Credits |
|
242,535 |
218,328 |
11 % |
252,000 |
224,455 |
12 % |
Adjusted EBITDA |
|
|
|
|
|
|
|
Hydro |
|
53,034 |
40,736 |
30 % |
55,881 |
40,481 |
38 % |
Wind |
|
117,676 |
113,481 |
4 % |
120,780 |
117,079 |
3 % |
Solar |
|
18,239 |
13,884 |
31 % |
18,239 |
13,884 |
— % |
Other corporate expenses2 |
|
(24,215) |
(23,001) |
(5) % |
(24,215) |
(23,001) |
(5) % |
Adjusted EBITDA1 |
|
164,734 |
145,100 |
14 % |
170,685 |
148,443 |
15 % |
1. |
These measures are not recognized measures under IFRS and therefore may not be comparable to those presented by other issuers. Revenues and Production Tax Credits Proportionate, Adjusted EBITDA and Adjusted EBITDA Proportionate are key performance indicators for the Corporation that cannot be reconciled with an IFRS measure. Please refer to Section 5- NON-IFRS MEASURES of the MD&A for more information. |
2. |
Other corporate expenses include corporate general and administrative expenses and prospective project expenses. |
OPERATING PERFORMANCE
FIRST QUARTER 2024
Production in the quarter was marked by a substantial increase in water flows at the hydro facilities in
CASH FLOW FROM OPERATING ACTIVITIES, FREE CASH FLOW1 AND FREE CASH FLOW PER SHARE1
Cash flows from operating activities for the three months ended
Free Cash Flow1 for the trailing twelve months ended
Free Cash Flow1 per share for the trailing twelve months ended
For the trailing twelve months ended
PROJECTS UNDER CONSTRUCTION
(Location) |
Type |
Ownership |
Gross |
Gross |
PPA term |
Expected COD |
|
||||
|
|||||||||||
|
|||||||||||
San Andrés Battery Energy Storage ( |
Storage |
100 |
|
35 |
4 |
— |
|
— |
|
2024 |
|
Lazenay ( |
Wind |
25 |
|
9.0 |
|
27.8 |
|
20 |
|
2024 |
|
Hale Kuawehi ( |
Solar |
100 |
|
30.0 |
|
87.4 |
|
25 |
3.0 |
2024 |
|
Storage |
|
30.0 |
2 |
|
|
||||||
|
Wind |
100 |
|
329.8 |
|
1,262.0 |
|
30 |
|
2024 |
|
Total Gross Installed Capacity in Construction Activities (MW) |
|
|
|
433.8 |
|
|
|
|
|
|
|
1. |
This information is intended to inform readers of the projects' potential impact on the Corporation's results. Actual results may vary. These estimates are up-to-date as at the date of this press release. |
2. |
Battery storage capacity of 30 MW/120 MWh (4 hours). |
3. |
PPA is a fixed lump sum capacity payment for the availability of dispatchable energy. |
4. |
Battery storage capacity of 35 MW/175 MWh (5 hours). |
EXECUTING ON GROWTH STRATEGY AND FINANCIAL PRIORITIES
On
The Corporation has a large-scale diversified ~10 GW prospective project portfolio supporting development and upcoming bid activities.
REAFFIRMING 2024 FINANCIAL GUIDANCE
Full year 2024 Adjusted EBITDA Proportionate1 and Free Cash Flow1 per share are expected to be in the range of
"Our first quarter results were in line with expectations, and we are on track to deliver our full year 2024 targets," said
NORMAL COURSE ISSUER BID
The Corporation received approval from the
As at the closing of the market on
DIVIDEND DECLARATION
On
The following dividends will be paid by the Corporation on
Date of |
Record date |
Payment date |
Dividend per |
Dividend per Series A Preferred Share |
Dividend per Series C |
|
|
|
|
$0.2028 |
|
1. |
This is not a recognized measure under IFRS and therefore may not be comparable to those presented by other issuers. Please refer to the "Non-IFRS Measures" section for more information. |
2. |
These assumptions are based on information currently available to the Corporation and this list of assumptions is not exhaustive. Please refer to the Section 5 OUTLOOK | 2024 Growth Targets of the MD&A for the year ended |
NON-IFRS MEASURES
Some measures referred to in this press release are not recognized measures under IFRS and therefore may not be comparable to those presented by other issuers.
Revenues and Production Tax Credits Proportionate, Adjusted EBITDA and Adjusted EBITDA Proportionate
Description of the measures
References in this document to "Revenues and Production Tax Credits Proportionate" are to Revenues and Production Tax Credits, plus
References in this document to "Adjusted EBITDA" are to operating income, to which are added (deducted) depreciation and amortization, ERP implementation, impairment charges, and the realized portion of the change in fair value of power hedges. References in this document to "Adjusted EBITDA Proportionate" are to Adjusted EBITDA, plus
Below is a reconciliation of the non-IFRS measures to their closest IFRS measures:
|
|
Three months ended |
Three months ended |
||||
|
|
Consolidation |
Share of |
Proportionate |
Consolidation |
Share of joint |
Proportionate |
|
|
|
|
|
|
|
|
Revenues and Production Tax Credits |
|
242,535 |
9,465 |
252,000 |
218,328 |
6,127 |
224,455 |
|
|
|
|
|
|
|
|
Operating income |
|
63,019 |
1,447 |
64,466 |
62,969 |
(774) |
62,195 |
Depreciation and amortization |
|
95,158 |
4,504 |
99,662 |
77,337 |
4,117 |
81,454 |
ERP implementation |
|
2,511 |
— |
2,511 |
2,569 |
— |
2,569 |
Realized loss on power hedges |
|
4,046 |
— |
4,046 |
2,225 |
— |
2,225 |
Adjusted EBITDA |
|
164,734 |
5,951 |
170,685 |
145,100 |
3,343 |
148,443 |
Adjusted Net Loss
References to "Adjusted Net Loss" are to net earnings or losses of the Corporation, to which the following elements are added (subtracted): unrealized portion of the change in fair value of derivative financial instruments, realized loss on the termination of interest rate swaps, realized gain on foreign exchange forward contracts, impairment charges, items that are outside of the normal course of the Corporation's cash generating operations, the net income tax expense (recovery) related to these items, and the share of loss (earnings) of joint ventures and associates related to the above items, net of related income tax.
The Adjusted Net Loss seeks to provide a measure that eliminates the earnings impacts of certain derivative financial instruments and other items that are outside of the normal course of the Corporation's cash generating operations, which do not represent the Corporation's operating performance.
Below is a reconciliation of Adjusted Net Loss to its closest IFRS measure:
|
Three months ended |
|
|
2024 |
2023 |
|
|
|
Net loss |
(37,659) |
(13,036) |
Add (Subtract): |
|
|
Share of unrealized portion of the change in fair value of financial instruments of joint ventures and associates, net of related income tax |
(308) |
(124) |
Unrealized portion of the change in fair value of financial instruments |
19,557 |
344 |
ERP implementation |
2,511 |
2,569 |
Realized gain on foreign exchange forward contracts |
(28) |
(33) |
Income tax recovery related to above items |
(4,306) |
(1,749) |
Adjusted Net loss |
(20,233) |
(12,029) |
Free Cash Flow, Free Cash Flow per Share and Payout Ratio
Description of the measures
References to "Free Cash Flow" are to cash flows from operating activities before changes in non-cash operating working capital items, less prospective projects expenses, maintenance capital expenditures net of proceeds from dispositions, scheduled debt principal payments, the portion of Free Cash Flow attributed to non-controlling interests, preferred share dividends declared, and gains realized on strategic transactions, plus or minus other elements that are not representative of the Corporation's long-term cash-generating capacity, such as realized gains and losses on contingent considerations related to past business acquisitions, transaction costs related to realized acquisitions, expenses related to the implementation of a cloud-based ERP solution, realized losses or gains on refinancing of certain borrowings or derivative financial instruments used to hedge the interest rate on certain borrowings or the exchange rate on equipment purchases, and tax payments related to fiscal strategies for the purpose of improving the long-term cash generating capacity of
References to "Free Cash Flow per Share" are to Free Cash Flow divided by the weighted-average number of common shares outstanding during the period.
Free Cash Flow is a measure of the Corporation's ability to pay a dividend and its ability to fund its growth from its cash generating operations, in the normal course of business, and through strategic transactions. Free Cash Flow per Share is a measure of the Corporation's ability to derive shareholder returns on a per-share basis from its cash generating operations, in the normal course of business, and through strategic transactions.
References to "Payout Ratio" are to dividends declared on common shares divided by Free Cash Flow.
Free Cash Flow and Payout Ratio calculation |
Trailing twelve months ended |
|
2024 |
2023 |
|
|
|
|
Cash flows from operating activities |
325,580 |
398,690 |
Add (Subtract) the following items: |
|
|
Changes in non-cash operating working capital items |
36,648 |
6,807 |
Prospective projects expenses |
32,469 |
25,218 |
Maintenance capital expenditures, net of proceeds from dispositions |
(23,768) |
(15,688) |
Scheduled debt principal payments |
(184,559) |
(158,412) |
Free Cash Flow attributed to non-controlling interests1 |
(46,864) |
(26,489) |
Dividends declared on Preferred shares |
(5,632) |
(5,632) |
|
4,671 |
3,660 |
Add (subtract) the following specific items2: |
|
|
Realized (gain) loss on termination of interest rate swaps3 |
2,405 |
(71,735) |
Realized gain on termination of foreign exchange forwards4 |
— |
(43,458) |
Principal and interest paid related to pre-acquisition period |
— |
1,312 |
Acquisition, integration and ERP implementation expenses |
12,783 |
21,413 |
Gain on disposition of non-controlling interests5 |
88,054 |
— |
Free Cash Flow |
241,787 |
135,686 |
Weighted-average number of shares outstanding |
203,556,158 |
203,545,519 |
Free Cash Flow per Share |
1.19 |
0.67 |
|
|
|
Dividends declared on common shares |
128,648 |
146,973 |
Payout Ratio |
53 % |
108 % |
|
|
|
1. |
The portion of Free Cash Flow attributed to non-controlling interests is subtracted, regardless of whether an actual distribution to non-controlling interests is made, in order to reflect the fact that such distributions may not occur in the period they are generated. |
2. |
Certain items are excluded from the Free Cash Flow and Payout Ratio calculations as they are deemed not representative of the Corporation's long-term cash-generating capacity, and include items such as realized gains and losses on contingent considerations related to past business acquisitions, transaction costs related to realized acquisitions, ERP implementation expenses, realized losses or gains on refinancing of certain borrowings or derivative financial instruments used to hedge the interest rate on certain borrowings or the exchange rate on equipment purchases, and tax payments related to fiscal strategies for the purpose of improving the long-term cash generating capacity of |
3. |
The Free Cash Flow for the trailing twelve months ended |
4. |
The Free Cash Flow for the trailing twelve months ended |
5. |
The Free Cash Flow for the trailing twelve months ended |
ADDITIONAL INFORMATION
ANNUAL MEETING OF SHAREHOLDERS
The Corporation will hold its Annual Meeting of Shareholders in a virtual format on
CONFERENCE CALL AND WEBCAST
The Corporation will hold a conference call and webcast on
About
For over 30 years,
Cautionary Statement Regarding Forward-Looking Information
To inform readers of the Corporation's future prospects, this press release contains forward-looking information within the meaning of applicable securities laws ("Forward-Looking Information"), including the Corporation's growth targets, power production, prospective projects, successful development, construction and financing (including tax equity funding) of the projects under construction and the advanced-stage prospective projects, sources and impact of funding, project acquisitions, execution of non-recourse project-level financing (including the timing and amount thereof), and strategic, operational and financial benefits and accretion expected to result from such acquisitions, business strategy, future development and growth prospects (including expected growth opportunities under the
Forward-Looking Information includes future-oriented financial information or financial outlook within the meaning of securities laws, including information regarding the Corporation's targeted production, the estimated targeted revenues and production tax credits, targeted Revenues and Production Tax Credits Proportionate, targeted Adjusted EBITDA and targeted Adjusted EBITDA Proportionate, targeted Free Cash Flow, targeted Free Cash Flow per Share and intention to pay dividend quarterly, the estimated project size, costs and schedule, including obtainment of permits, start of construction, work conducted and start of commercial operation for Development Projects and Prospective Projects, the Corporation's intent to submit projects under Requests for Proposals, the qualification of
Forward-Looking Information is based on certain key assumptions made by the Corporation, including, without restriction, those concerning hydrology, wind regimes and solar irradiation; performance of operating facilities, acquisitions and commissioned projects; availability of capital resources and timely performance by third parties of contractual obligations; favourable economic and financial market conditions; average merchant spot prices consistent with external price curves and internal forecasts; no material changes in the assumed
For more information on the risks and uncertainties that may cause actual results or performance to be materially different from those expressed, implied or presented by the forward-looking information or on the principal assumptions used to derive this information, please refer to the "Forward-Looking Information" section of the Management's Discussion and Analysis for the three months ended
SOURCE