Creststreet Power & Income Fund LP Reports Second Quarter 2007 Financial Results



    /NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
    DISSEMINATION IN THE UNITED STATES./

    CALGARY, Aug. 13 /CNW/ - Creststreet Power & Income Fund LP (the
"Partnership") (CRS.UN, CRS.DB, CRS.DB.A) reported electrical based revenue of
$3.5 million for the second quarter of 2007 similar to the same period in
2006. Revenue for the six month period ended June 30, 2007 increased to $8.8
million from $7.4 million in 2006 as both wind energy projects had improved
turbine availability for the six month period. For the three and six month
periods ended June 30, 2007 the Partnership's production was approximately 10%
and 1%, respectively below the independent engineer's long-term projection.
    Pubnico Point and Mount Copper delivered an aggregate 57.0 gigawatt hours
of electricity during the second quarter of 2007 to Hydro-Québec and Nova
Scotia Power pursuant to their long-term power purchase agreements compared to
57.2 gigawatt hours in 2006. For the second quarter of 2007, turbine
availability improved to 96% from 91% a year ago which offset the impact of
lower wind speeds. For the six months ended June 30, 2007 the Partnership
delivered an aggregate of 142.6 gigawatt hours compared to 120.6 gigawatt
hours in 2006. Cash flow from operations before non-cash working capital
changes for the second quarter of 2007 was $1.30 million compared to $1.35
million in the prior year. For the first half of 2007 operating cashflow
before non-cash working capital changes was $4.43 million, a 53% increase over
the $2.9 million generated in the first half of 2006 due to improved turbine
availability and wind performance in the first quarter. The Partnership
generated cash flow from operations including non cash working capital items
of $2.46 million which was $0.60 million higher than the prior year quarter,
due to the collection of better first quarter revenues in 2007. The
Partnership generated cash flow from operations including changes in non-cash
working capital items of $3.07 million in the first six months of 2007
compared with $3.82 million in 2006, as the improved operating performance was
partially offset by an increase in non-cash working capital items due to
continued growth in interest receivable on the Kettles Hill subordinated notes
investment. This receivable will ultimately be collected when Kettles Hill
completes its sale process. We declared total cash distributions of $3.74
million and paid monthly cash distributions of $0.0542 per unit during the
first six months of 2007. At June 30, 2007, the Partnership had cash and cash
equivalents of $4.06 million on hand.
    The Partnership's revenue, earnings and cash flow are subject to seasonal
fluctuations. The highest level of revenue is expected in winter months
(generally the first and fourth quarters) and the lowest level of revenue in
the third quarter (summer months).

    Mount Copper
    For the first half of 2007, Mount Copper's production was 1% below the
independent engineers projection compared to 25% below in 2006. This increase
is due to higher wind speeds and improved turbine availability. During the
second quarter of 2007, Mount Copper's production was approximately 7% below
the independent engineer's long-term projection compared to approximately 18%
below in the prior year. This increase in energy production from prior year
was due to higher wind speeds. Turbine availability at Mount Copper was 95%
which is consistent with warranted levels. This is an improvement over the
prior year second quarter of 90%.

    Pubnico Point
    For the first half of 2007, Pubnico Point's production was also 1% below
the independent engineers projection compared to 3% below in 2006. This
increase is due to higher wind speeds and improved turbine availability in the
first quarter of 2007. During the second quarter of 2007, Pubnico Point's
production was approximately 16% below the independent engineer's long-term
projection compared to approximately 3% above in the prior year. This
deviation was principally a result of lower wind speeds in the quarter.
Turbine availability was in line with the Manager's expectations.

    Kettles Hill
    Creststreet Kettles Hill Windpower LP ("Kettles Hill", the "Partnership")
announced on July 30th that its 63 Megawatt windpower facility located near
Pincher Creek in southern Alberta had achieved substantial completion, as
defined in the Partnership's prospectus. All 35 turbines are now fully erected
and are producing electricity. The Kettles Hill windpower facility is
comprised of 35 Vestas V80 1.8 Megawatt wind turbines and produces sufficient
renewable energy for 27,000 homes.
    The Independent Committee of the Board of Kettles Hill, along with the
appointed independent advisor, Blair Franklin Capital Partners Inc., will now
commence the auction process which will provide liquidity to unitholders. The
Manager expects completion of that process before year end.

    Distribution Declaration
    The Board of Directors of the Partnership has authorized monthly cash
distributions of $0.0542 per unit to be paid according to the following
schedule:

    
    Distribution period         Record date        Payment date  $ per unit
    ------------------------------------------------------------------------
    September 2007       September 28, 2007    October 15, 2007     $0.0542
    October 2007           October 31, 2007   November 15, 2007     $0.0542
    November 2007         November 30, 2007   December 14, 2007     $0.0542
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------

    At June 30, 2007, the Partnership had 11.5 million units issued and
    outstanding.
    

    Conference Call
    The General Partner of Creststreet Power & Income Fund LP will hold a
conference call to discuss its results today at 10:00 a.m. eastern time. To
join the call, please dial 416 644-3418 in Toronto, or toll-free 1 800
732-0232 outside of the greater Toronto area. The call will also be webcast
live at www.creststreet.com and at http://www.newswire.ca.

    About Creststreet Power & Income Fund LP

    Creststreet Power & Income Fund LP (the "Partnership") owns and operates
two wind energy projects in Quebec and Nova Scotia with a total of 47 wind
turbines and power generating capacity of 84.6 megawatts. All electricity
generated by these wind energy projects is being sold pursuant to long-term
power purchase agreements with provincial electricity utilities.

    THE PARTNERSHIP IS ORGANIZED IN ACCORDANCE WITH THE TERMS AND CONDITIONS
OF A LIMITED PARTNERSHIP AGREEMENT WHICH PROVIDES THAT NO UNITS MAY BE OWNED
BY, AMONG OTHER THINGS, A PERSON WHO IS A "NON-RESIDENT" OF CANADA FOR
PURPOSES OF THE INCOME TAX ACT (CANADA) OR A PARTNERSHIP.

    CERTAIN STATEMENTS INCLUDED IN THIS NEWS RELEASE CONSTITUTE
"FORWARD-LOOKING STATEMENTS" WITHIN THE MEANING OF THE SECURITIES ACT
(ONTARIO). SUCH FORWARD-LOOKING STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS,
UNCERTAINTIES AND OTHER FACTORS WHICH MAY CAUSE THE ACTUAL RESULTS,
PERFORMANCE OR ACHIEVEMENTS OF THE PARTNERSHIP TO BE MATERIALLY DIFFERENT FROM
ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY SUCH
FORWARD-LOOKING STATEMENTS.

    THE FORWARD-LOOKING INFORMATION CONTAINED IN THIS NEWS RELEASE REPRESENTS
THE EXPECTATIONS OF CRESTSTREET POWER & INCOME FUND LP AS AT AUGUST 13, 2007
AND, ACCORDINGLY, IS SUBJECT TO CHANGE AFTER SUCH DATE. HOWEVER, CRESTSTREET
POWER & INCOME FUND LP EXPRESSLY DISCLAIMS ANY INTENTION OR OBLIGATION TO
UPDATE OR REVISE ANY FORWARD-LOOKING INFORMATION, WHETHER AS A RESULT OF NEW
INFORMATION, FUTURE EVENTS OR OTHERWISE, EXCEPT AS REQUIRED BY APPLICABLE LAW.

    

    CRESTSTREET POWER & INCOME FUND LP
    Consolidated Balance Sheets

    (Unaudited, In Thousands)                                     Year ended
                                            June 30, 2007  December 31, 2006
    -------------------------------------------------------------------------
    Assets:
    Current Assets
    Cash and cash equivalents                 $     4,055        $     5,721
    Restricted cash                                   225                225
    Accounts receivable                             1,703              2,908
    Due from related parties                        2,918              1,363
    Prepaid and other assets                          430                347
    -------------------------------------------------------------------------
                                                    9,331             10,564
    Prepaid and other assets                           65                 89
    Notes receivable                               34,000             33,219
    Deferred charges                                    -              3,850
    Plant and equipment                           123,717            127,146
    Pre-operating costs                               156                198
    Intangible asset                                4,549              4,696
    -------------------------------------------------------------------------
                                              $   171,818            179,762
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities:
    Current Liabilities
    Accounts payable and accrued liabilities  $     1,926        $     2,865
    Deferred revenue                                   54                 33
    Distribution payable                              623                623
    Due to related parties                          3,372              2,501
    -------------------------------------------------------------------------
                                                    5,975              6,022
    Notes payable                                  43,135             44,000
    Unsecured convertible debentures               52,852             55,532
    Deferred revenue                                   73                 64
    Asset retirement obligation                     1,347              1,280
    Future income tax liability                     9,853             10,127
    -------------------------------------------------------------------------
                                                  113,235            117,025
    Partners' capital                              71,375             75,156
    Deficit and accumulated other
     comprehensive income                         (12,792)           (12,419)
    -------------------------------------------------------------------------
                                              $   171,818        $   179,762
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    CRESTSTREET POWER & INCOME FUND LP
    Combined Consolidated Statements of Operations and Comprehensive Income

    (Unaudited, In Thousands,
     except per unit data)          Three months ended      Six months ended
                                    June 30,   June 30,   June 30,   June 30,
                                       2007       2006       2007       2006
    -------------------------------------------------------------------------
    Revenue:
    Electricity sales             $   3,507  $   3,531  $   8,797  $   7,407
    Windpower production
     incentive                          153        141        368        284
    Investment income                   846        194      1,762        327
    -------------------------------------------------------------------------
                                      4,506      3,866     10,927      8,018
    Expenses:
    Operating costs                     716        766      1,470      1,622
    Management fees                     115        230        229        472
    Administrative costs                579        520      1,208      1,030
    -------------------------------------------------------------------------
                                      1,410      1,516      2,907      3,124
    -------------------------------------------------------------------------
    Income before the undernoted      3,096      2,350      8,020      4,894
    Unrealized loss on financial
     instrument                        (268)      (909)     1,096      1,029
    Amortization of deferred
     charges                              -        155          -        299
    Amortization of intangible
     assets                              73         73        146        146
    Amortization of plant and
     equipment                        1,728      1,756      3,441      3,509
    Amortization of pre-operating
     costs                               21         21         42         41
    Accretion on asset retirement
     obligation                          34          6         67         12
    Interest expense                  2,120      1,049      4,182      2,047
    -------------------------------------------------------------------------
    Profit (Loss) before taxes
     and non-controlling interest      (612)       199       (954)    (2,189)
    -------------------------------------------------------------------------
    Income taxes
      Current tax                         -        (17)         -          -
      Future income tax
       expense (recovery)              (513)      (327)      (318)    (1,450)
    -------------------------------------------------------------------------
                                       (513)      (344)      (318)    (1,450)
    Non-controlling interest            172          -         92         45
    -------------------------------------------------------------------------
    Net Profit (loss) and
     comprehensive income (loss)       (271)       543       (728)      (784)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Net profit (loss) per unit -
     basic and diluted            $   (0.02) $    0.05  $   (0.06) $   (0.07)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Weighted average number
     of units                        11,501     11,501     11,501     11,501
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Deficit, beginning of period,
     as previously reported         (12,521)    (8,110)   (12,419)    (6,783)
    Financial instruments -
     recognition and measurement          -          -        355          -
    -------------------------------------------------------------------------
    Restated deficit,
     beginning of period            (12,521)    (8,110)   (12,064)    (6,783)
    Net Profit (Loss)                  (271)       543       (728)      (784)
    -------------------------------------------------------------------------
    Deficit, end of period        $ (12,792) $  (7,567) $ (12,792) $  (7,567)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Accumulated other
     comprehensive income                 -          -          -          -
    -------------------------------------------------------------------------
    Deficit and accumulated
     other comprehensive income   $ (12,792) $  (7,567) $ (12,792) $  (7,567)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    CRESTSTREET POWER & INCOME FUND LP
    Consolidated Statements of Partners' Capital


    (Unaudited, In Thousands)       Three months ended      Six months ended
                                    June 30,   June 30,   June 30,   June 30,
                                       2007       2006       2007       2006
    -------------------------------------------------------------------------
    Partners' capital -
     beginning of period          $  73,246  $  79,817  $  75,155  $  81,980
    Unsecured convertible
     debentures option value                         -        (40)         -
    Distributions declared to
     the unitholders                 (1,871)    (2,066)    (3,740)    (4,229)
    -------------------------------------------------------------------------
    Partners' capital -
     end of period                $  71,375  $  77,751  $  71,375  $  77,751
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    CRESTSTREET POWER & INCOME FUND LP
    Consolidated Statements of Cash Flows

    (Unaudited, In Thousands)       Three months ended      Six months ended
                                    June 30,   June 30,   June 30,   June 30,
                                       2007       2006       2007       2006
    -------------------------------------------------------------------------
    Cash flow from operating
     activities:
      Net Profit (Loss)           $    (271) $     543  $    (728) $    (784)
      Add (deduct) items not
       affecting cash:
      Unrealized loss on
       financial instrument            (268)      (909)     1,096      1,029
      Amortization of deferred
       charges                            -        155          -        299
      Amortization of intangible
       assets                            73         73        146        146
      Amortization of plant and
       equipment                      1,728      1,756      3,441      3,509
      Amortization of
       pre-operating costs               21         21         42         41
      Accretion of asset
       retirement obligation             34          6         67         12
      Accretion of interest
       expense                          338         27        665         54
      Recognition of deferred
       revenue                          (14)         -        (71)         -
      Future income tax
       expense (recovery)              (513)      (327)      (318)    (1,450)
      Non-controlling interest          172          -         92         45
    -------------------------------------------------------------------------
                                      1,300      1,345      4,432      2,901

      Non -cash operating
       working capital:
      Decrease in accounts
       receivable                     1,429        358      1,205      1,599
      Increase (decrease) in
       prepaid expense and
       other assets                     161        (67)       (59)      (307)
      Increase (decrease) in
       accounts payable and
       accrued liabilities              512        410       (939)      (184)
      Increase in deferred revenue        -          -        100          -
      Increase in amounts due
       to/from related parties         (939)      (181)    (1,670)      (185)
    -------------------------------------------------------------------------
                                      2,463      1,865      3,069      3,824
    -------------------------------------------------------------------------
    Cash flows from financing
     activities:
      Finance issue costs                 -       (104)         -       (104)
      Increase in notes payable           -          -          -      7,000
      Dividends to non-controlling
       interest                         (51)         -       (203)       (45)
      Distributions to unitholders   (1,870)    (2,164)    (3,740)    (4,327)
    -------------------------------------------------------------------------
                                     (1,921)    (2,268)    (3,943)     2,524
    -------------------------------------------------------------------------
    Cash flows from investing
     activities:
      Decrease in restricted cash         -          -          -      3,572
      Net increase in loans
       receivable                         -     (1,500)      (781)    (6,500)
      Additions to plant and
       equipment                        (11)         6        (11)    (3,878)
    -------------------------------------------------------------------------
                                        (11)    (1,494)      (792)    (6,806)
    -------------------------------------------------------------------------
    Net increase (decrease)
     in cash                            531     (1,897)    (1,666)      (458)
    Cash and cash equivalents,
     beginning of period              3,524      5,334      5,721      3,895
    -------------------------------------------------------------------------
    Cash and cash equivalents,
     end of period                $   4,055  $   3,437  $   4,055  $   3,437
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Supplemental cash
     information:
    Interest paid                 $     912  $     558  $   3,681  $   2,002
    Interest received             $     (48) $     (74) $    (164) $    (145)
    Large corporate tax paid      $       -  $      17  $       -  $      34

    





For further information:

For further information: Derren Newell VP, Finance and CFO, Creststreet
Power & Income General Partner Limited, Tel: (403) 513-0766, E-mail:
dnewell@creststreet.com

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