Boralex Announces its 2009 Results

MONTREAL, Feb. 25 /CNW Telbec/ - Boralex Inc. ("Boralex" or the "Corporation") ended fiscal 2009 with a solid performance despite a difficult economic context.

    
    (in millions of dollars, except per share data)
    -------------------------------------------------------------------------
                                 Three-month               Twelve-month
                                periods ended             periods ended
                         ----------------------------------------------------
                          December 31, December 31, December 31, December 31,
                                 2009         2008         2009         2008
                         ----------------------------------------------------

    Revenues from energy
     sales                       46.1         54.3        184.8        197.2
    EBITDA                       12.0         15.6         57.3         68.8
    Net earnings                 14.7          4.4         24.4         20.4
      per share (basic
       and diluted)             $0.39        $0.12        $0.65        $0.54
    Cash flows from
     operations                  11.3         11.1         47.4         55.2
    -------------------------------------------------------------------------
    

Boralex ended fiscal 2009 with total revenues from energy sales of $184.8 million, down 6.3% compared to $197.2 million in 2008. Earnings before interest, taxes, depreciation and amortization (EBITDA) amounted to $57.3 million versus $68.8 million a year earlier. The decrease in operating results is largely due to lower electricity prices for power generated by the hydroelectric and thermal power stations in the United States, lower REC sales, and the performance of the Boralex Power Income Fund ("Fund") and the problems experienced at its Dolbeau power station. In that regard, the Fund depreciated Dolbeau's tangible assets by close to 50%, which had a $5.6 million impact on Boralex's EBITDA. Furthermore, following the 16% interest in the Corporation's European assets acquired by the strategic partner, Cube Infrastructure Fund ("Cube"), in the fourth quarter of 2009, Boralex registered a gain on dilution of $13.9 million. This operation demonstrates the Corporation's ability to create value for its shareholders and the very high quality of the European assets. The Corporation ended fiscal 2009 with net earnings of $24.4 million or $0.65 per share (basic and diluted), up $4.0 million over 2008.

Revenues in the wind power segment increased 11.1% over 2008 to $33.9 million in 2009. EBITDA also rose 11.7%, to $26.8 million in 2009. These increases are mainly related to the startup of the first two wind farms in Phase I at Thames River in Ontario, to the increased production at existing sites due to more favourable wind conditions, and also to the higher availability rates of the turbines.

The hydroelectric power stations reported revenues of $10.3 million and EBITDA of $5.5 million, down $1.5 million and $2.4 million respectively compared to fiscal 2008. These results stem from lower electricity prices (in $US) on the open electricity market in New York State, resulting from the economic slowdown and lower natural gas prices. However, the contribution of the new Ocean Falls power station in British Columbia partially offset the impact of the lower prices.

The wood-residue segment recorded revenues of $123.4 million, down 9.2% from revenues in 2008. This decrease stemmed in part from lower REC sales and lower electricity prices. However, these items had only a slight impact on EBITDA, which amounted to $40.0 million versus $40.5 million in 2008. This segment also benefited in 2009 from a number of positive factors, including lower fuel supply and maintenance costs, as well as the drop in the value of the Canadian dollar, primarily in the first three quarters.

The profitability of the natural gas plant was comparable to that of 2008 with EBITDA of $2.2 million in 2009 versus $2.3 million in 2008. Revenues were down $1.9 million to $17.2 million in 2009. The significant drop in the price of natural gas, which had a domino effect on electricity and steam prices, was offset by lower fuel supply costs.

In the fourth quarter 2009, revenues generated by energy sales totalled $46.1 million, down $8.2 million from the same period in 2008. EBITDA amounts to $12.0 million, or $17.6 million excluding the impairment of the Fund's tangible assets. Excluding this specific item, EBITDA rose 12.8% over the same quarter in 2008. The increase stems from higher power generation in the wind power segment and the contribution of the Ocean Falls power station, but was partially offset by lower electricity prices and lower REC sales. The recognition of a gain on dilution of $13.9 million, a result of the participation of the strategic partner in Europe, led to net earnings in the fourth quarter of $14.7 million ($0.39 per share) compared to $4.4 million ($0.12 per share) for the same quarter in 2008.

Patrick Lemaire, President and Chief Executive Officer of Boralex Inc. noted that "in 2009 we maintained significant cash flows, even during the recession. Our Corporation met its goals of ensuring prudent management of its investments and capital structure in the economic context that has prevailed since the Fall of 2008. We ended fiscal 2009 with a number of acquisitions that represent more than 75 MW and we hope, for 2010, to continue our efforts to find new business opportunities, obtain financing and develop quality projects."

About Boralex

Boralex is a major independent power producer whose core business is the development and operation of power stations that generate renewable energy.

Employing over 300 people, the Corporation operates 29 power stations with a total installed capacity of 417 megawatts ("MW") in Canada, in the Northeastern United States and in France. In addition, the Corporation has, alone or with its European and Canadian partners, power projects under development that will add close to 300 MW of power, of which almost 100 MW will come online by the end of fiscal 2010. Boralex is distinguished by its diversified expertise and in-depth experience in three power generation segments - wind, hydroelectric and thermal.

Boralex also holds a 23% interest in Boralex Power Income Fund, which has 10 power stations with a total installed capacity of 190 MW in Québec and the United States. These sites are managed by Boralex.

Boralex shares are listed on the Toronto Stock Exchange (TSX) under the ticker symbol BLX.

More information is available at www.boralex.com or www.sedar.com.

Certain statements contained in this press release, including those regarding future results and performance, are forward-looking statements based on current expectations. The accuracy of such statements is subject to a number of risks, uncertainties and assumptions that may cause actual results to differ materially from those projected, including, but not limited to, the general impact of economic conditions, raw material price increases and availability, currency fluctuations, fluctuations in electricity selling prices, the Company's financing capacity, adverse changes in general market and industry conditions, as well as other factors listed in the Company's filings with different securities commissions.

The summarized financial statements included in this press release also contain certain financial measurements that are not recognized as Generally Accepted Accounting Principles of Canada (GAAP). To assess the operating performance of its assets and reporting segments, the Corporation uses earnings before interest, taxes, depreciation and amortization (EBITDA) and cash flows from operations as performance measurements. These measures are not defined under GAAP and do not have a standardized definition prescribed by GAAP. Therefore, they may not be comparable to similar measures presented by other companies. EBITDA is defined in the summarized financial statements included with this press release. Cash flows from operations corresponds to cash flows from operating activities before changes in non-cash working capital items as disclosed in the consolidated statements of cash flows attached in this press release.

Notice to shareholders

The interim consolidated financial statements as at December 31, 2009 and 2008 have not been reviewed by our auditors PricewaterhouseCoopers LLP. The financial statements are the responsability of the management of Boralex Inc. and have been reviewed and approved by the Board of Directors, on the recommandation of its Audit Committee.

The following financial information was extracted from the annual consolidated financial statements of Boralex Inc. (the "Corporation"). The complete annual consolidated financial statements were prepared in accordance with Canadian generally accepted accounting principles.

    
    Consolidated Balance Sheets

                                                          As at        As at
                                                    December 31, December 31,
    (in thousands of dollars) (unaudited)                  2009         2008
    ------------------------------------------------------------------------
                                                                   (Restated)
    Assets

    Current assets
    Cash and cash equivalents                            37,821       69,195
    Accounts receivable                                  39,632       48,812
    Future income taxes                                     422          238
    Inventories                                           8,726        8,833
    Prepaid expenses                                      2,537        2,106
    ------------------------------------------------------------------------
                                                         89,138      129,184

    Investment                                           55,446       69,348
    Property, plant and equipment                       413,539      330,443
    Electricity sales contracts                          49,023       26,402
    Other assets                                         56,621       67,577
    ------------------------------------------------------------------------
                                                        663,767      622,954
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------


    Liabilities

    Current liabilities
    Bank loans and advances                              12,291            -
    Accounts payable and accrued liabilities             28,913       22,113
    Income taxes                                            283        1,716
    Other liabilities                                         -        5,718
    Current portion of long-term debt                    33,273       29,410
    ------------------------------------------------------------------------
                                                         74,760       58,957

    Long-term debt                                      197,116      158,035
    Future income taxes                                  37,185       39,437
    Fair value of derivative financial instruments        7,645        3,000
    Non-controlling interests                             7,031          805
    ------------------------------------------------------------------------
                                                        323,737      260,234
    Shareholders' equity
    Capital stock                                       222,694      222,694
    Contributed surplus                                   4,295        3,069
    Retained earnings                                   159,900      135,461
    Accumulated other comprehensive income (loss)       (46,859)       1,496
    ------------------------------------------------------------------------
                                                        340,030      362,720
    ------------------------------------------------------------------------
                                                        663,767      622,954
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------


    Consolidated Statements of Earnings


    (in thousands of
     dollars, except
     per share amounts                     For the                   For the
     and number of             three-month periods      twelve-month periods
     shares)                     ended December 31,        ended December 31,
     (unaudited)                 2009         2008         2009         2008
    -------------------------------------------------------------------------
                                         (Restated)                (Restated)
    Revenues from energy
     sales                     46,149       54,316      184,779      197,246
    Renewable energy tax
     credits                    3,404        3,400       13,853       12,463
    Operating costs            29,093       41,683      126,286      138,400
    -------------------------------------------------------------------------
                               20,460       16,033       72,346       71,309
    Share in earnings of
     the Fund                  (5,088)       1,607       (2,090)       7,826
    Management revenue
     from the Fund              1,789        1,352        5,876        5,395
    Other revenue                 286        1,691        2,061        2,849
    -------------------------------------------------------------------------
                               17,447       20,683       78,193       87,379
    -------------------------------------------------------------------------
    Other expenses
    Management and
     operation of the
     Fund                       1,348        1,014        4,789        4,065
    Administration costs        4,114        4,065       16,079       14,479
    -------------------------------------------------------------------------
                                5,462        5,079       20,868       18,544
    -------------------------------------------------------------------------
    Operating earnings
     before amortization       11,985       15,604       57,325       68,835
    -------------------------------------------------------------------------

    Amortization                6,675        6,288       26,056       24,438
    Foreign exchange
     loss (gain)                1,271         (834)       1,473       (1,437)
    Net loss on
     financial instruments        929           49          923          143
    Financing costs             3,497        3,836       13,727       13,806
    Gain on dilution          (13,865)           -      (13,865)           -
    -------------------------------------------------------------------------
                               (1,493)       9,339       28,314       36,950
    -------------------------------------------------------------------------

    Earnings before income
     taxes                     13,478        6,265       29,011       31,885
    Income taxes (recovery)    (1,280)       1,833        4,470       11,329
    -------------------------------------------------------------------------
                               14,758        4,432       24,541       20,556
    Non-controlling
     interests                    (46)         (34)        (102)        (146)
    -------------------------------------------------------------------------
    Net earnings               14,712        4,398       24,439       20,410
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net earnings per
     Class A share
     (basic) (in
     dollars)                    0.39         0.12         0.65         0.54
    Net earnings per
     Class A share
     (diluted) (in
     dollars)                    0.39         0.12         0.65         0.54
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Weighted average
     number
     of Class A shares
    outstanding (basic)    37,740,921   37,740,921   37,740,921   37,739,840
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Consolidated Statements of Retained Earnings
                                                                     For the
                                                        twelve-month periods
                                                           ended December 31,
    (in thousands of dollars) (unaudited)                  2009         2008
    -------------------------------------------------------------------------
                                                                   (Restated)
    Balance - beginning of period                       135,461      115,669
    Application of Section 3064                               -         (336)
    -------------------------------------------------------------------------
    Balance restated - beginning of period              135,461      115,333
    Share redemption premium                                  -         (282)
    Net earnings for the period                          24,439       20,410
    -------------------------------------------------------------------------
    Balance - end of period                             159,900      135,461
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Consolidated Statements of Comprehensive Income (Loss)

                                           For the                   For the
                               three-month periods      twelve-month periods
    (in thousands of             ended December 31,        ended December 31,
     dollars) (unaudited)        2009         2008         2009         2008
    -------------------------------------------------------------------------
                                         (Restated)                (Restated)
    Net earnings for the
     period                    14,712        4,398       24,439       20,410
    -------------------------------------------------------------------------

    Other comprehensive
     income (loss)
      Translation
       adjustments
        Unrealized foreign
         exchange gain
         (loss) on trans-
         lation of finan-
         cial statements
         of self-sustaining
         foreign operations    (6,056)      30,528      (32,389)      40,994
        Reclassification to
         net earnings of a
         realized foreign
         exchange loss
         (gain) related to
         the reduction of
         net investment in
         self-sustaining
         foreign operations     1,141       (1,285)       1,076       (1,285)
        Share of cumulative
         translation
         adjustments of the
         Fund                    (101)       3,429       (2,174)       4,297
        Taxes                      33         (784)         581       (1,012)
      Cash flow hedges
        Change in fair
         value of financial
         instruments               39       12,891        7,140       23,542
        Hedging items
         realized and
         recognized in net
         earnings              (3,991)      (6,655)     (22,608)      (5,485)
        Hedging items
         realized and
         recognized in
         balance sheet           (271)           -       (3,884)        (673)
        Taxes                     651         (893)       4,383       (4,460)
    -------------------------------------------------------------------------
                               (8,555)      37,231      (47,875)      55,918
    -------------------------------------------------------------------------
    Comprehensive income
     (loss) for the period      6,157       41,629      (23,436)      76,328
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Consolidated Statements of Cash Flows

                                           For the                   For the
                               three-month periods      twelve-month periods
    (in thousands of             ended December 31,        ended December 31,
     dollars) (unaudited)        2009         2008         2009         2008
    -------------------------------------------------------------------------
                                         (Restated)                (Restated)
    Operating activities
    Net earnings               14,712        4,398       24,439       20,410
    Distributions received
     from the Fund              2,409        2,409        9,638       10,326
    Adjustments for non-cash
     items
      Net loss on
       financial instruments      719           49        1,253          143
    Share in earnings
       of the Fund              5,088       (1,607)       2,090       (7,826)
      Amortization              6,675        6,288       26,056       24,438
      Amortization of
       deferred financing
       costs and monetization
       program expenses           719          784        2,893        2,928
      Renewable energy
       tax credits             (3,165)      (1,588)      (7,113)      (4,583)
      Gain on dilution        (16,315)           -      (16,315)           -
      Future income taxes         (51)       1,339        3,002        9,413
      Other                       539         (935)       1,470          (49)
    -------------------------------------------------------------------------
                               11,330       11,137       47,413       55,200
    Change in non-cash
     working capital
     balances                  13,259        6,287       13,373       (1,004)
    -------------------------------------------------------------------------
                               24,589       17,424       60,786       54,196
    -------------------------------------------------------------------------
    Investing activities
    Business acquisitions     (47,283)           -      (53,758)      (5,781)
    Purchase of property,
     plant and equipment      (24,399)     (11,293)     (84,532)     (44,577)
    Change in debt
     servicing reserves           150           49       (1,091)          21
    Development projects       (3,357)        (517)     (10,337)      (5,617)
    Other                         671       (2,208)      (6,366)      (3,675)
    -------------------------------------------------------------------------
                              (74,218)     (13,969)    (156,084)     (59,629)
    -------------------------------------------------------------------------
    Financing activities
    Increase (decrease)
     in bank loans and
     advances                    (925)        (448)      12,291            -
    Increase in long-term
     debt                      35,158          126       68,714          126
    Payments on long-term
     debt                      (6,788)      (1,602)     (27,539)     (19,258)
    Share repurchase                -         (665)           -         (859)
    Net proceeds from
     share issuance                 -            -            -        1,714
    Change in non-
     controlling interests     23,181            -       22,213            -
    Other                           -           30            -           36
    -------------------------------------------------------------------------
                               50,626       (2,559)      75,679      (18,241)
    -------------------------------------------------------------------------
    Translation adjustment
     on cash
    and cash equivalents         (814)       9,588      (11,755)      13,674
    -------------------------------------------------------------------------
    Net change in cash and
     cash equivalents             183       10,484      (31,374)     (10,000)

    Cash and cash
     equivalents -
     beginning of period       37,638       58,711       69,195       79,195
    -------------------------------------------------------------------------

    Cash and cash
     equivalents - end of
     period                    37,821       69,195       37,821       69,195
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    SUPPLEMENTAL
     INFORMATION
    Cash and cash
     equivalents paid for:
      Interests                 2,526        2,543        9,130        9,816
      Income taxes                  -          462        1,736        1,783
    -------------------------------------------------------------------------


    Segmented Information
    (tabular amounts in thousands of dollars, unless otherwise specified)
    (unaudited)
    

The Corporation's power stations are grouped under four distinct segments: wind power, hydroelectric power, wood-residue thermal power and natural gas thermal power, and are engaged mainly in power generation. The classification of these segments is based on the different cost structures relating to each type of power stations.

The Corporation analyzes the performance of its operating segments based on the earnings before interest, taxes, depreciation and amortization ("EBITDA"). EBITDA is not a measure of performance under Canadian generally accepted accounting principles; however, management uses this performance measure to assess the operating performance of its segments. Earnings for each segment are presented on the same basis as those of the Corporation. In the consolidated statements of earnings, EBITDA is represented by Operating income before amortization.

    
    The following table
     reconciles EBITDA                     For the                   For the
     with net earnings:        three-month periods      twelve-month periods
                                 ended December 31,        ended December 31,
                                 2009         2008         2009         2008
    -------------------------------------------------------------------------
                                         (Restated)                (Restated)

    Net earnings               14,712        4,398       24,439       20,410
    Non-controlling
     interests                     46           34          102          146
    Income taxes (recovery)    (1,280)       1,833        4,470       11,329
    Gain on dilution          (13,865)           -      (13,865)           -
    Financing costs             3,497        3,836       13,727       13,806
    Net loss on
     financial instruments        929           49          923          143
    Foreign exchange loss
     (gain)                     1,271         (834)       1,473       (1,437)
    Amortization                6,675        6,288       26,056       24,438
    -------------------------------------------------------------------------
    EBITDA                     11,985       15,604       57,325       68,835
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Information by operating segment
                                           For the                   For the
                               three-month periods      twelve-month periods
                                 ended December 31,        ended December 31,
                                 2009         2008         2009         2008
    -------------------------------------------------------------------------
                                         (Restated)                (Restated)
    PRODUCTION (in MWh)
    Wind farms                 79,741       56,683      235,418      220,500
    Hydroelectric power
     stations                  41,017       34,833      145,303      132,057
    Wood-residue thermal
     power stations           304,399      295,213    1,156,652    1,232,907
    Natural gas thermal
     power station             14,859       15,260       37,501       37,829
    -------------------------------------------------------------------------
                              440,016      401,989    1,574,874    1,623,293
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    REVENUE FROM ENERGY SALES
    Wind farms                 10,974        7,942       33,872       30,543
    Hydroelectric power
     stations                   2,948        2,844       10,329       11,753
    Wood-residue thermal
     power stations            27,031       37,040      123,391      135,897
    Natural gas thermal
     power station              5,196        6,490       17,187       19,053
    -------------------------------------------------------------------------
                               46,149       54,316      184,779      197,246
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    EBITDA
    Wind farms                  9,085        6,059       26,789       23,967
    Hydroelectric power
     stations                   1,743        1,647        5,538        7,919
    Wood-residue thermal
     power stations             9,359        9,064       39,995       40,488
    Natural gas thermal
     power station                915        1,378        2,155        2,338
    Corporate and
     eliminations              (9,117)      (2,544)     (17,152)      (5,877)
    -------------------------------------------------------------------------
                               11,985       15,604       57,325       68,835
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    PURCHASE OF PROPERTY,
     PLANT AND EQUIPMENT
    Wind farms                 22,884        9,352       76,761       31,485
    Hydroelectric power
     stations                     153           33        1,184           89
    Wood-residue thermal
     power stations               670        1,291        4,851        8,527
    Natural gas thermal
     power station                  -           12           28           81
    Corporate and
     eliminations                 692          605        1,708        4,395
    -------------------------------------------------------------------------
                               24,399       11,293       84,532       44,577
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

                                                          As at        As at
                                                    December 31, December 31,
                                                           2009         2008
    -------------------------------------------------------------------------
    ASSETS                                                         (Restated)
    Wind farms                                          363,644      242,944
    Hydroelectric power stations                         34,622       23,019
    Wood-residue thermal power stations                 138,014      183,881
    Natural gas thermal power station                    13,600       17,151
    Corporate and eliminations                          113,887      155,959
    -------------------------------------------------------------------------
                                                        663,767      622,954
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

SOURCE Boralex Inc.

For further information: For further information: Ms. Sophie Paquet, Communications Advisor, Boralex Inc., (514) 985-1353, sophie.paquet@boralex.com


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