Boralex: Strong Growth in Q4 and Fiscal 2007



    
    (in millions of dollars, except for per share data)
    -------------------------------------------------------------------------
                                  Three months ended     Twelve months ended
                                ---------------------------------------------
                                December    December    December    December
                                      31,         31,         31,         31,
                                    2007        2006        2007        2006
                                ---------------------------------------------

    Revenue from energy sales       45.4        35.5       162.8       120.0
    EBITDA                          18.6        12.0        60.8        42.8
    Net earnings                     5.9         4.6        21.5        14.7
    Net earnings per share
     (basic)                     $  0.16     $  0.15     $  0.63     $  0.49
    -------------------------------------------------------------------------
    

    MONTREAL, Feb. 29 /CNW Telbec/ - Boralex Inc. (TSX-BLX) ("Boralex" or the
"Corporation") reports a 36% increase in revenues in 2007, driven by the
vigorous Renewable Energy Certificates (RECs) market and the start-up of a new
wind power site.
    For its fiscal year ended December 31, 2007, Boralex's revenue from
energy sales increased by $42.8 million to $162.8 million. Earnings before
interest, taxes, depreciation and amortization (EBITDA) grew 42% to
$60.8 million compared to $42.8 million a year earlier. Net earnings amounted
to $21.5 million, or $0.63 per share versus $14.7 million, or $0.49 per share,
in 2006. The Corporation's significant growth in revenue and EBITDA stems
mainly from increased revenue from RECs sales, improved availability and
productivity in the wood-residue and wind power segments, and higher
electricity selling prices.
    Revenue in the wind power segment grew 17% to $27.2 million. EBITDA for
this segment was $22.8 million in 2007, up 15% year over year. These results
stem largely from the start up of La Citadelle, France wind farm, which added
$2.0 million to revenue and $1.7 million to EBITDA for the year. The
hydroelectric power stations recorded revenue of $9.1 million, down 17% from
2006. Hydrology was less favourable than in 2006, with levels 7% lower than
historical averages. However, higher electricity prices on the New England
market and capacity premiums for the New York State power stations generated
$1.2 million.
    Energy revenue in the wood-residue segment rose 57%, to $111.9 million,
compared to $71.1 million in 2006. EBITDA grew by $27.4 million, from
$5.6 million in 2006 to $33.0 million in 2007. Strong RECs sales had a
positive $19.4 million impact on revenue and EBITDA. The remainder of the
revenue increase stems from higher average electricity selling prices and
higher production volume.
    Fourth quarter 2007 revenue from energy sales totalled $45.4 million, up
$9.9 million or 28% compared to $35.5 million for the same quarter in 2006.
EBITDA increased 55% over EBITDA of $12.0 million in the fourth quarter of
2006 to reach $18.6 million. The increase in fourth-quarter revenue and EBITDA
is mainly due to strong growth in the wood-residue segment, along with the
fact that the Livermore Falls power station qualified for the RECs program
retroactive to April 1, 2007.
    "In 2008, Boralex should continue to perform well again, benefiting from
the same positive factors that helped it in 2007. The vigorous RECs market,
the improved performance in the wood-residue segment, the expansion of the
wind power segment and the available cash put Boralex in a sound financial
position for pursuing its current and future expansion projects" said
Mr. Patrick Lemaire, President and CEO of Boralex.

    About Boralex

    Boralex is distinguished by its leading expertise in four types of power
generation - wind power, hydroelectric power, thermal power from wood-residue
and cogeneration power from natural gas. Employing close to 300 people, the
Corporation owns and operates 21 power stations with a combined installed
capacity of 351 MW in Quebec, the northeastern United States and France. The
Corporation also operates an urban wood processing and recycling centre in
Montreal. www.boralex.com
    In addition, Boralex holds a 23% interest in Boralex Power Income Fund
which owns 10 power stations in Quebec and the United States with an installed
capacity of close to 190 MW. Management of the Fund's assets is provided by
Boralex.

    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 effect of
general economic conditions, decreased demand for Boralex's products,
increases in raw material costs, fluctuations in currency exchange rates,
fluctuations in sales prices and adverse changes in general market and
industry conditions. The financial statements included in this press release
also contain certain financial measurements that are not recognized as
generally accepted accounting principles ("GAAP").
    To assess the operating performance of its assets and reporting segments,
the Corporation uses Earnings before interest, taxes, depreciation and
amortization ("EBITDA") as a performance measurement. EBITDA is not defined
under GAAP and does not have a standardized meaning prescribed by GAAP.
Therefore, this measure may not be comparable to similar measures presented by
other enterprises. EBITDA is defined in the financial statements included with
this press release.


    
    Consolidated balance sheets
    (in thousands of dollars)
    (unaudited)
                                                         As at         As at
                                                   December 31,  December 31,
                                                          2007          2006
    -------------------------------------------------------------------------
                                                                   (restated)
    Assets

    Current assets
    Cash and cash equivalents                           79,195        13,899
    Accounts receivable                                 39,200        26,964
    Future income taxes                                  2,394             -
    Inventories                                          8,002         5,342
    Prepaids                                             2,171         2,776
    -------------------------------------------------------------------------
                                                       130,962        48,981

    Investment                                          67,321        75,553
    Property, plant and equipment                      258,712       280,136
    Electricity sale contracts                          18,527        20,631
    Future income taxes                                      -         6,249
    Other assets                                        39,209        44,480
    -------------------------------------------------------------------------
                                                       514,731       476,030
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities

    Current liabilities
    Accounts payable and accrued liabilities            20,869        20,005
    Income taxes                                         1,481         1,786
    Current portion of long-term debt                   26,786        41,835
    -------------------------------------------------------------------------
                                                        49,136        63,626

    Long-term debt                                     148,747       192,493
    Future income taxes                                 23,430        20,780
    Fair value of derivatives                            1,400             -
    Other liabilities                                    6,642        16,368
    Non-controlling interests                              607           730
    -------------------------------------------------------------------------
                                                       229,962       293,997
    Shareholders' equity
    Capital stock                                      221,557       111,281
    Contributed surplus                                  1,974         1,170
    Retained earnings                                  115,669        97,649
    Accumulated other comprehensive income             (54,431)      (28,067)
    -------------------------------------------------------------------------
                                                       284,769       182,033
    -------------------------------------------------------------------------
                                                       514,731       476,030
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Consolidated statements of earnings
    (in thousands of dollars, except per-share amounts and number of shares)
    (unaudited)
                                                        For the twelve-month
                                    For the quarters            periods
                                   ended December 31       ended December 31
                                    2007        2006        2007        2006
    -------------------------------------------------------------------------
                                           (restated)              (restated)

    Revenue from energy sales     45,384      35,469     162,816     120,002
    Renewable energy tax
     credits                       2,500       2,261      12,033      10,622
    Operating costs               28,343      27,059     112,184      95,380
    -------------------------------------------------------------------------
                                  19,541      10,671      62,665      35,244

    Share in earnings of
     the Fund                      1,293       2,244       6,830      10,023
    Management revenue from
     the Fund                      1,393       1,377       5,601       5,457
    Other revenue                    786         898       2,503       4,776
    -------------------------------------------------------------------------
                                  23,013      15,190      77,599      55,500
    -------------------------------------------------------------------------
    Other expenses
    Management and operation
     of the Fund                   1,103       1,110       4,510       4,249
    Administration costs           3,284       2,120      12,336       8,429
    -------------------------------------------------------------------------
                                   4,387       3,230      16,846      12,678
    -------------------------------------------------------------------------
    Earnings before
     amortization                 18,626      11,960      60,753      42,822
    -------------------------------------------------------------------------

    Amortization                   5,484       6,392      21,627      21,176
    Financial instruments            368           -      (5,875)          -
    Financial expenses             3,166       3,878      15,069      12,681
    -------------------------------------------------------------------------
                                   9,018      10,270      30,821      33,857
    -------------------------------------------------------------------------

    Earnings before income taxes   9,608       1,690      29,932       8,965
    Income tax expense (recovery)  3,661      (2,988)      8,457      (5,924)
    -------------------------------------------------------------------------
                                   5,947       4,678      21,475      14,889
    Non-controlling interests        (34)        (42)         70        (168)
    -------------------------------------------------------------------------
    Net earnings                   5,913       4,636      21,545      14,721
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Net earnings per class A
     share (basic) (in dollars)     0.16        0.15        0.63        0.49
    Net earnings per class A
    share (diluted) (in dollars)    0.15        0.15        0.62        0.48
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Weighted average number
     of class A shares
     outstanding (basic)      37,454,625  30,049,586  34,403,033  30,033,885
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Consolidated statements of retained earnings
    (in thousands of dollars)
    (unaudited)
                                                For the twelve-month periods
                                                       ended December 31
                                                          2007          2006
    -------------------------------------------------------------------------
                                                                   (restated)
    Balance - beginning of period, as
     previously reported                                99,208        84,188
    Modification of accounting policy                   (1,559)       (1,260)
    -------------------------------------------------------------------------
    Balance - beginning of period, restated             97,649        82,928
    Share issue costs, net of related income taxes      (3,525)            -
    Net earnings for the period                         21,545        14,721
    -------------------------------------------------------------------------
    Balance - end of period                            115,669        97,649
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Consolidated Statements of Comprehensive Income
    (in thousands of dollars)
    (unaudited)
                                                        For the twelve-month
                                    For the quarters            periods
                                   ended December 31       ended December 31
                                    2007        2006        2007        2006
    -------------------------------------------------------------------------

    Net earnings for the period    5,913       4,636      21,545      14,721
    -------------------------------------------------------------------------

    Other components of
     comprehensive income:
      Translation adjustments
        Non-realized exchange
         gains (losses)
         on translation
         of the financial
         statements of
         self-sustaining
         foreign operations,
         net of income taxes      (1,084)      7,830     (24,591)      2,504
        Share of cumulative
         translation adjustments
         of the Fund, net of
         income taxes                 39         883      (1,955)        (52)
      Cash flow hedges
        Change in fair value
         of derivatives              884           -       2,828           -
        Realized hedging items
         reclassed to net
         earnings                   (255)          -      (1,959)          -
        Termination of hedging
         relationships                 -           -      (5,874)          -
        Income tax expense          (201)          -       1,602           -
    -------------------------------------------------------------------------
                                    (617)      8,713     (29,949)      2,452
    -------------------------------------------------------------------------
    Comprehensive income of
     the period                    5,296      13,349      (8,404)     17,173
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Consolidated statements of cash flows
    (in thousands of dollars)
    (unaudited)
                                                        For the twelve-month
                                    For the quarters            periods
                                   ended December 31       ended December 31
                                    2007        2006        2007        2006
    -------------------------------------------------------------------------
                                           (restated)              (restated)
    Operating activities
    Net earnings                   5,913       4,636      21,545      14,721
    Distributions received
     from the Fund                 3,098       3,099      12,391      12,392
    Adjustment for non-cash items
      Share in earnings of
       the Fund                   (1,293)     (2,244)     (6,830)    (10,023)
      Amortization                 5,484       6,392      21,627      21,176
      Amortization of deferred
       financing costs               737         257       2,795         628
      Renewable energy tax
       credits                    (1,099)     (1,509)     (4,460)     (9,870)
      Future income taxes          2,390      (2,884)      8,348      (5,250)
      Financial instruments          368           -      (5,875)          -
      Other                          418         195       2,007         744
    -------------------------------------------------------------------------
                                  16,016       7,942      51,548      24,518
    Net change in non-cash
     working capital balances     (9,995)     (2,359)    (16,491)    (10,713)
    -------------------------------------------------------------------------
                                   6,021       5,583      35,057      13,805
    -------------------------------------------------------------------------
    Investing activities
    Purchase of property,
     plant and equipment          (5,586)     (1,486)    (22,478)    (19,201)
    Variation in restricted
     funds held for the
     debt service                    (41)        102       6,175      (5,905)
    Business acquisitions              -      (3,587)          -      (6,749)
    Development projects          (1,994)       (212)     (4,609)       (848)
    Other                           (154)        264      (2,595)     (1,045)
    -------------------------------------------------------------------------
                                  (7,775)     (4,919)    (23,507)    (33,748)
    -------------------------------------------------------------------------
    Financing activities
    Bank loans and advances            -           -           -      (1,215)
    Increase in long-term debt         -       1,377     151,437      69,629
    Payments of long-term debt    (1,468)     (4,773)   (198,454)    (56,487)
    Financing costs                    -           -      (1,632)     (1,167)
    Net proceeds on share
     issuance                          -           -     105,307         273
    Fees related to the
     monetization program            (52)     12,289        (593)     10,935
    Other                              -           -         (50)          -
    -------------------------------------------------------------------------
                                  (1,520)      8,893      56,015      21,968
    -------------------------------------------------------------------------
    Translation adjustments
     on cash and cash
     equivalents                     585         671      (2,269)      1,259
    -------------------------------------------------------------------------
    Net change in cash and
     cash equivalents             (2,689)     10,228      65,296       3,284

    Cash and cash equivalents
     - beginning of period        81,884       3,671      13,899      10,615
    -------------------------------------------------------------------------

    Cash and cash equivalents
     - end of period              79,195      13,899      79,195      13,899
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    SUPPLEMENTAL DISCLOSURE
    Cash and cash equivalents
     paid for:
      Interests                    2,406       3,608      11,522      12,028
      Income taxes                    59        (100)      1,065         720
    -------------------------------------------------------------------------



    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 the production of energy. The
classification of these segments is based on the different cost structures
relating to each type of power station.
    The Corporation analyzes the performance of its operating segments based
on their EBITDA which is defined as earnings before interest, taxes,
depreciation and amortization. EBITDA is not a measure of performance under
Canadian generally accepted accounting principles; however, management uses
this performance measure for assessing the operating performance of its
reportable segments. Earnings for each segment are presented on the same basis
as those of the Corporation.

    The following table reconciles EBITDA to net earnings:

                                                        For the twelve-month
                                    For the quarters            periods
                                   ended December 31       ended December 31
                                    2007        2006        2007        2006
    -------------------------------------------------------------------------
                                           (restated)              (restated)

    Net earnings                   5,913       4,636      21,545      14,721
    Non-controlling interests         34          42         (70)        168
    Income tax expense (recovery)  3,661      (2,988)      8,457      (5,924)
    Financial expenses             3,166       3,878      15,069      12,681
    Financial instruments            368           -      (5,875)          -
    Amortization                   5,484       6,392      21,627      21,176
    -------------------------------------------------------------------------
    Consolidated EBITDA           18,626      11,960      60,753      42,822
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Information by segment
                                                        For the twelve-month
                                    For the quarters            periods
                                   ended December 31       ended December 31
                                    2007        2006        2007        2006
    -------------------------------------------------------------------------

    PRODUCTION (in MWh)
    Wind power stations           60,592      61,922     208,710     189,964
    Hydroelectric power
     stations                     31,887      37,865     106,762     138,518
    Wood-residue thermal power
     stations                    275,059     272,100   1,190,265   1,010,206
    Natural gas thermal power
     station                      16,219      15,608      38,421      38,365
    -------------------------------------------------------------------------
                                 383,757     387,495   1,544,158   1,377,053
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    REVENUE FROM ENERGY SALES
    Wind power stations            8,034       7,757      27,210      23,174
    Hydroelectric power stations   2,520       2,867       9,137      10,939
    Wood-residue thermal
     power stations               29,973      19,891     111,860      71,126
    Natural gas thermal power
     station                       4,857       4,954      14,609      14,763
    -------------------------------------------------------------------------
                                  45,384      35,469     162,816     120,002
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    EBITDA
    Wind power stations            7,020       6,782      22,833      19,766
    Hydroelectric power stations   1,640       1,974       5,424       7,481
    Wood-residue thermal power
     stations                     10,673       1,167      33,017       5,586
    Natural gas thermal power
     station                         714       1,322       2,271       5,405
    Corporate and eliminations    (1,421)        715      (2,792)      4,584
    -------------------------------------------------------------------------
                                  18,626      11,960      60,753      42,822
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    PURCHASE OF PROPERTY,
     PLANT AND EQUIPMENT
    Wind power stations            3,250         535      16,644       9,688
    Hydroelectric power
     stations                        355         221       1,172         600
    Wood-residue thermal power
     stations                      1,893         726       4,233       8,671
    Natural gas thermal power
     station                           -           -          25          24
    Corporate and eliminations        88           4         404         218
    -------------------------------------------------------------------------
                                   5,586       1,486      22,478      19,201
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


                                                   December 31,  December 31,
                                                          2007          2006
    -------------------------------------------------------------------------
    ASSETS                                                         (restated)

    Wind power stations                                196,816       196,102
    Hydroelectric power stations                        12,434        34,284
    Wood-residue thermal power stations                130,715       147,099
    Natural gas thermal power station                   16,132        20,476
    Corporate and eliminations                         158,634        78,069
    -------------------------------------------------------------------------
                                                       514,731       476,030
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    




For further information:

For further information: Ms. Mylène Masse, Director, Communications,
Boralex Inc., (514) 985-1353, mylene.masse@boralex.com


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