Significant renewable energy production increases resulting in operating
revenue growth of 65% for the quarter and 73% for the year
EBITDA increases of 172% for the quarter and 165% for the year
Dividend increased to $0.065 per annum, payable quarterly
TORONTO, March 28, 2013 /CNW/ - Sprott Power Corp. (TSX: SPZ) ("Sprott
Power" or "the Company"), an owner, operator and developer of
renewable energy projects, today announced its results for the three
months and year ended December 31, 2012.
"It has been another exciting and transformative year for Sprott Power.
We completed the Shear Wind transaction which greatly increased our
assets under commercial operations and added a new partnership with
Inveravante of Spain," said Jeff Jenner, CEO of Sprott Power. "In
addition we successfully completed the construction of our 31.5 MW
Amherst I and the 2.3 MW Glace Bay II wind farm projects. These
efforts more than tripled our managed assets and almost quadrupled our
expected annual production of renewable energy. The management team
has secured additional contracted assets to double again our operating
capacity in the next two years resulting in the Company seeking a
strategic partner to assist in financing this growth. We look forward
to continuing to execute on our growth plans in 2013."
Operational and Growth Highlights
As at December 31, 2012, the Company partially or wholly owned ten
operating wind power facilities with an aggregate installed capacity of
143.2 MWs. These consist of three facilities in Ontario with an
aggregate installed capacity of 21.6 MWs and seven facilities in Nova
Scotia with an aggregate installed capacity of 121.6 MWs. Each of
these facilities sells its electricity under long-term power purchase
agreements ("PPAs") that expire between 2020 and 2037 with a weighted
average life of 17 years remaining on the contracts.
The Company's operating assets performed as expected during 2012,
producing approximately 371.7 gigawatt hours ("GWhs") of electricity
during the year ended December 31, 2012, which represents approximately
144% of the 2011 comparable period.
12 Months Ended December 31 -
Gross GWhs produced
Total Generation (GWhs)
Ontario projects were previously owned by Sky Generation Inc. prior to
February 8, 2011.
Certain Nova Scotia projects previously owned by Confederation Power
Inc. prior to February 1, 2011 and by Shear Wind Inc. ("Shear Wind")
prior to November 23, 2012.
GWhs shown represent annual production results for acquired assets prior
to the acquisition by the Company. The 2012 results includes only 8.5
months of actual production from Amherst and two months of actual
production from Glace Bay II as both these assets were constructed
during the year.
In April 2012, the Company, with its 49% partner, announced the
completion of its first internally developed and constructed project,
the 31.5 MW Amherst wind power project in Cumberland County, Nova
Scotia (the "Amherst I Project"). At the time the Amherst I Project
was commissioned the annual gross production under management for the
Company almost doubled to 215 GWh on a run rate basis. The Amherst I
Project was constructed on time and on budget.
In October 2012, the Company completed the expansion of its Glace Bay II
operations with the construction and commissioning of a 2.3 MW
turbine. It is expected to provide an estimated 7 GWhs annually to the
In November 2012, the Company completed the acquisition of Shear Wind
for cash consideration of approximately $33.2 million. As a result,
the Company owns a 49% interest in the 62.1 MW Glen Dhu Wind Farm
("Glen Dhu"), the largest wind farm in Nova Scotia and a 50% interest
in the 1.6 MW Fitzpatrick Mountain Wind Farm ("Fitz"). These assets
generate approximately 200 GWh of renewable electricity and the
acquisition increased the Company's annual gross production under
management to over 400 GWh on a run-rate basis.
During the year, the Company entered into certain agreements and letters
of intent under which it advanced funds to secure interests in various
contracted wind power development projects with PPAs representing 77.5
MW of capacity. These transactions are subject to customary terms and
due diligence, including any required consent from the Ontario Power
Authority and the approval of the board of directors of the Company.
The Company increased its dividends per share 62.5% during the year to
an annual $0.065 cash dividend, payable quarterly.
In March 2012, the Company completed its first offering as a public
company through the issuance of 10.1 million units at a price of $1.05
for each unit, 10.1 million flow through shares at a price of $1.20 for
each flow through share and 0.15 million warrants at a price of $0.07
for each warrant. The offering generated gross proceeds of
approximately $22.8 million.
In August 2012, the Company completed a public offering of 34,500
extendible convertible unsecured subordinated debentures (the
"Debentures") at a price of $1,000 per Debenture for an aggregate
principal amount of $34.5 million. The Debentures yield 6.75% and
mature on December 31, 2017. The Debentures are convertible at the
option of the holder into common shares ("Shares") of the Company at a
conversion price of $1.30 per Share (the "Conversion Price") and
contain a change of control feature that, if applicable, reduces the
Conversion Price. The net proceeds from the sale of the Debentures
were used to partially finance the acquisition of all of Shear Wind's
issued and outstanding shares.
Subsequent to December 31, 2012, the Company announced that its Board
had initiated a process to identify, examine and consider a range of
strategic options available to the Company with a view to finding
additional capital to fund its growth and enhancing shareholder value,
including a possible sale of the Company (the "Strategic Review"). As
part of the Strategic Review, the Company announced that it has decided
to transition to internal management by way of a notice of termination,
effective July 31, 2013, of its Management Services Agreement ("MSA")
with Sprott Power Consulting LP. The Company is to pay $8.5 million
(the "Termination Fee") in full satisfaction of all amounts owing by
the Company under the MSA. The Termination Fee may be paid by cash or
the issuance of Shares.
Revenue from energy sales for the three months ended December 31, 2012
was $5.7 million, as compared to $3.5 million in the same period of
2011, an increase of $2.2 million or 65%. Revenue for the year ended
December 31, 2012 was $16.7 million, as compared to $9.6 million in the
same period of 2011, an increase of $7.1 million or 73%.
Earnings before interest, income taxes, depreciation and amortization,
impairment loss and the inclusion of Glen Dhu and Fitz ("EBITDA"1) for the three months ended December 31, 2012 was $4.9 million as
compared to $1.8 million, a net increase of $3.1 million or 172% as
compared to in the same period of 2011. EBITDA for the year ended
December 31, 2012 was $10.6 million as compared to $4.0 million, a net
increase of $6.6 million or 165% as compared to the same period of
The net loss attributable to the shareholders for the three months ended
December 31, 2012 was $6.5 million, as compared to an income of $0.4
million in the same period of 2011. The net loss attributable to the
shareholders for the year ended December 31, 2012 was $8.1 million or
$0.125 per share, as compared to a net loss of $1.9 million or $0.042
per share in the same period of 2011. Included in annual loss per
share calculations for the twelve months ended December 31, 2012 is an
impairment loss of approximately $5.0 million related to projects under
The net source of cash from operations prior to changes in working
capital for the year ended December 31, 2012 was $2.3 million as
compared to $0.8 million in the same period of 2011.
At December 31, 2012 the Company had working capital of $17.7 million,
including $17.5 million in unrestricted cash as compared to working
capital of $10.2 million, including $8.5 million in unrestricted cash
as at December 31, 2011. The Company's assets included short and
long-term restricted cash of an additional $12.8 million at December
31, 2012, as compared to $18.4 million as at December 31, 2011.
At December 31, 2012 the Company had total assets of $236.8 million as
compared to $177.9 million as at December 31, 2011. At December 31,
2012 the Company had long-term debt of $129.9 million as compared to
$87.9 million (including construction loan) as at December 31, 2011.
The Company's full audited consolidated financial statements and
Management's Discussion and Analysis for the quarter and year ended
December 31, 2012, can be found at www.sedar.com or the Company's website at www.sprottpower.com.
1 A financial term (EBITDA) that the Company utilizes to assess the
financial performance of its business that is not a measure recognized
under International Financial Reporting Standards ("IFRS"). This
non-IFRS measure should not be considered an alternative to performance
measures determined in accordance with IFRS and may not be comparable
to similar measures presented by other issuers. See the calculations
included in the December 31, 2012 Management's Discussion and Analysis
of Financial Results for a discussion of this calculation.
About Sprott Power Corp.
Sprott Power is a publicly-traded (TSX: SPZ) Canadian-based company
dedicated to the development, ownership and operation of renewable
energy projects. Through project development efforts, acquisitions,
partnerships and joint ventures, Sprott Power provides its shareholders
with income and growth from the renewable power generation sector of
the energy industry.
Certain information contained in this press release may constitute
"forward-looking information" which reflects the current expectations
of Sprott Power. This information reflects Sprott Power's current
beliefs with respect to future events and is based on information
currently available to management. Forward-looking information
involves significant known and unknown risks, uncertainties and
assumptions. Many factors could cause actual results, performance or
achievements to be materially different from any future results,
performance or achievements that may be expressed or implied by such
forward-looking information including, without limitation, the risks
listed under the heading "Risk Factors" in the Company's Annual
Information Form dated March 28, 2013. Should one or more of these
risks or uncertainties materialize, or should assumptions underlying
the forward-looking information prove incorrect, actual results,
performance or achievements could vary materially from those expressed
or implied by the forward-looking information contained in this
release. Although forward-looking information contained in this release
is based upon what Sprott Power believes to be reasonable assumptions,
management cannot assure investors that actual results, performance or
achievements will be consistent with this forward-looking information.
The forward-looking information is made as of the date of this release
and Sprott Power does not assume any obligation to update or revise it
to reflect new events or circumstances, except as required by law.
SOURCE: Sprott Power Corp.
For further information:
Jeff Jenner, CA, CBV
President and Chief Executive Officer
Sprott Power Corp.
(416) 815 0700 ext. 238