VANCOUVER, May 29, 2014 /CNW/ - Run of River Power Inc. ("ROR" or the "Company") (TSX-V:ROR) announces its financial and operating results for the quarter ended March 31, 2014. The unaudited condensed consolidated interim financial statements and management discussion and analysis for the quarter ended March 31, 2014 have been filed on SEDAR and posted on ROR's website (www.runofriverpower.com). All figures reported herein are in Canadian dollars unless otherwise stated.
For the period ended March 31, 2014, the Company incurred a net comprehensive loss of $1,002,881, and, as at that date, has an accumulated deficit of $35,216,445 and a working capital deficit of $19,068,607. To date, the Company has financed its operations primarily through debt and equity issuances and through the disposition of projects.
Selected Financial Information(1)
|($000's except per share and generation amounts)||Q1 2014||Q1 2013|
|Basic and diluted loss per share||(0.01)||(0.01)|
|Cash flow from (used in) operations||135||(595)|
|Long-term debt (reclassified to held for sale disposal group March 2014)||9,297||13,210|
|(1)Selected financial information was derived from the condensed consolidated interim financial statements for the quarter ended March 31, 2014 with certain comparative figures and is prepared in accordance with International Financial Reporting Standards ("IFRS"). EBITDA is provided to assist management and investors in determining the Corporation's cash flow provided by operations before interest, taxes, depreciation and amortization and does not have any meaning prescribed in IFRS and may not be comparable to similar measures presented by other companies. Refer to Non- GAAP measures - EBITDA following for the reconciliation between this non-GAAP financial measure and comparable measures calculated in accordance with IFRS.|
For the period ending March 31, 2014 ("Q1 2014") electricity sales of $87,765 decreased $37,393 or 34.3% from March 31, 2013 ("Q1 2013") sales of $125,158 as a direct result of a decrease in electricity generated to 1,367 MWh from 2,080 MWh. Electricity production was down due to lower hydrology conditions for the year despite an overall improvement in the facility's conversion effectiveness.
Q1 2014 plant operating expense of $139,774 increased by $4,430 or 3.3% from the Q1 2013 figure of $135,344. The increase was due to added maintenance in the quarter.
General and administration ("G&A") expense of $282,002 during Q1 2014 was $98,071 or 25.8% lower than the total of $380,073 during Q1 2013. The decreased G&A was due to reduced project development activities in Q1 2014.
The Corporation incurred net finance costs of $400,331 during Q1 2014 compared to $412,547 for Q1 2013. This decrease of $12,216 or 3% was due to a reduction in the long term debt for the Brandywine facility.
Funds used in operations in Q1 2013 were $594,533 compared to funds from operations of $135,806 in the current period. This improvement of $730,339 was due to changes in working capital items
Financial Position and Going Concern
As at March 31, 2014, the Corporation had $500,061 cash on hand, of which $5,113 was restricted cash. These cash resources will be used to fund the Corporation's ongoing working capital requirements.
The success of the Corporation is dependent on its ability to economically generate electrical power and its ability to sell the electricity generated on a profitable basis to BC Hydro and other Electricity Purchase Agreements. There is no certainty that such events will occur and that sources of financing will be obtained on acceptable terms. Whether and when the Corporation can achieve profitability and positive cash flow is also uncertain. These material uncertainties cast significant doubt on the Corporation's ability to continue as a going concern.
On May 5, 2014, a definitive arrangement agreement ("Arrangement") was entered into with Concord SCCP General Partner (I) Inc. ("Concord"), ROR Acquisition Ltd. ("AcquireCo"), a wholly-owned subsidiary of Concord, the Company (or ROR Power), Rockford Energy Corp. ("REC"), a wholly-owned subsidiary of the Company, and 0999130 B.C. Ltd to sell the Corporation and the remaining development assets held in the Corporation. If the completion of the transaction is unsuccessful and the Corporation is unable to find another entity to fund operations, the Corporation would be considered insolvent.
The Company reports its financial position, results of operations and cash flows in accordance with IFRS.
About Run of River Power Inc.
ROR develops renewable, sustainable energy through its portfolio of clean energy projects. The Company helps diversify BC's energy mix by providing a cleaner way to generate power and increasing the security of BC's energy supply. ROR operates an Eco Logo© certified hydroelectric power generation station at Brandywine Creek, near Whistler, BC that provides green power for about 4,000 homes.
Disclaimer Regarding Forward Looking Information
Certain information included in this press release constitutes forward-looking information under applicable securities legislation. Forward-looking information typically contains statements with words such as "anticipate", "believe", "expect", "plan", "intend", "estimate", "propose", "project" or similar words suggesting future outcomes or statements regarding an outlook, or statements that certain events or conditions "may" occur. Forward-looking information in this press release includes, but is not limited to, statements regarding the expectations of management of ROR regarding: (i) the Transaction; (ii) completion of the Transaction; (iii) entry into the Payment Indenture; (iv) the intended results of the Transaction; (v) the conditions to completion of the Transaction; (vi) the calculation of and timing for payment of the ROR Consideration to the Shareholders; (vii) the Shareholders' meeting in connection with the Transaction; (viii) receipt of a fairness opinion and valuation in connection with the Transaction; (ix) the preparation and delivery of an information circular in connection with a Shareholders meeting to consider the Transaction; and * the proposed de-listing of the ROR Shares and the proposed ceasing to be a reporting issuer of ROR.
Although ROR believes that the expectations reflected in the forward-looking information are reasonable, undue reliance should not be placed on forward-looking information because ROR can give no assurance that such expectations will prove to be correct. Such forward-looking statements are subject to risks and uncertainties that may cause actual results, performance or developments to differ materially from those contained in the statements including, without limitation, the risks that: (1) the Transaction may not be completed for any reason whatsoever, including that the requisite Shareholder, court and/or regulatory approval of the Transaction may not be obtained or that AcquireCo and/or the REC Acquirer may not have the necessary funds to make the Advance and the REC Purchase Price available to ROR; (2) an Payment Indenture may never be entered into for any reason whatsoever; (3) the Transaction, if completed, may not have the intended effect as set out in this news release; (4) the aggregate amount of the ROR liabilities to be deducted from the Available Funds may be significant, and the resulting ROR Consideration, if any, may be nominal; (5) the meeting of Shareholders to consider the Transaction may not occur; (6) a fairness opinion and/or valuation may not be obtained, or if obtained, may not provide a favourable opinion as to the fairness or value of the Transaction; (7) the information circular and other materials for the meeting of Shareholders may not be prepared or delivered to Shareholders as expected; (8) the ROR Shares may not be de-listed and ROR may not cease to be a reporting issuer following closing for any reason whatsoever, and (9) such other risks and uncertainties beyond the control of ROR.
Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which have been used. The forward-looking information contained in this press release is made as of the date hereof and ROR undertakes no obligation to update publicly or revise any forward-looking information, whether as a result of new information, future events or otherwise, unless required by applicable securities laws. The forward looking information contained in this press release is expressly qualified by this cautionary statement.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE: Run of River Power Inc.
For further information:
Richard W. Hopp
President and CEO