Capital Power- a little less power
On October,5 2014 Capital Power released it's third quarter results.It had a slight setback primarily due to a shortfall in power in Alberta and it also had to buy power for a period from competitors at higher than expected prices.Also it lost a $73 million tax deferral;this is a non-cash item and doesn't affect flow of funds from operations but it does affect net income.Still it's funds from operations were $85 for the quarter and $177 million for the first half compared to $191 million for the first half of 2013.While it recorded net income of $20 million or $.17 per share in 2014 compared to $20 million or $.20 per share in 2013.
A bad Summer
Capital Power(CPX) is larger than some of the newer utilities such as Algonquin Power but they are actually growing faster than CPX.For example, Capital has 2600 MW of owned and operated installed capacity while Northland Power has about 1450 MW and Algonquin Power has only 1100 MW.Capital has 14 facilities but much of their power generation is centred in Alberta and the Prairie provinces. Capital Power is most directly comparable to Algonquin Power and Northland Power although both have less generation power.Also both Algonquin and Northland are trying to diversify into new jurisdictions. Capital Power which is largely focussed in Alberta lost revenue from seasonally low power prices in Alberta in the summer.Also it had a power shortfall and had to backup power from another utility at above average prices.Both of these factors weighed on their bottom line.So that although Capital gave guidance that the flow of funds would be $360 to $400 million, it now ads that it will be at the bottom end of that guidance.This is approaching the same guidance figure given by Algonquin Power and Northland Power.Northland Power states that guidance will be for $345 to $355 million of EBITDA for 2014 and $380 to $400 million for 2015.While Algonquin Power is on track to hit $340 to $350 million of EBITDA in 2014.
New Facilities
Three contracted wind facilities have been added to the fleet as well as the Shepard Energy centre;it is firing now and will begin commercial operations in early 2015.The K2 wind project will be completed in Q2 2015.Funds from operations were $83 million compared to the same quarter in 2013.This blog expects that funds flow will be higher in Q4 and throughout 2015.
The rest of the Year
First investors should see that CPX is still quite a bit bigger than it's junior competitors,namely,Algonquin and Northland Power.But the other two are taking great strides to catch up to Capital Power.Of the two Algonquin is relying too much on one kind of investment in one jurisdiction .Also Capital is building it's facilities while Algonquin is acquiring them.But both Algonquin and Northland are very efficient at what they do as EBITDA for all three will be in a small range for 2014 and likely 2015.This blog believes that Capital Power is a very solid investment but needs to diversify it's assets so it doesn't have another bad summer.
A bad Summer
Capital Power(CPX) is larger than some of the newer utilities such as Algonquin Power but they are actually growing faster than CPX.For example, Capital has 2600 MW of owned and operated installed capacity while Northland Power has about 1450 MW and Algonquin Power has only 1100 MW.Capital has 14 facilities but much of their power generation is centred in Alberta and the Prairie provinces. Capital Power is most directly comparable to Algonquin Power and Northland Power although both have less generation power.Also both Algonquin and Northland are trying to diversify into new jurisdictions. Capital Power which is largely focussed in Alberta lost revenue from seasonally low power prices in Alberta in the summer.Also it had a power shortfall and had to backup power from another utility at above average prices.Both of these factors weighed on their bottom line.So that although Capital gave guidance that the flow of funds would be $360 to $400 million, it now ads that it will be at the bottom end of that guidance.This is approaching the same guidance figure given by Algonquin Power and Northland Power.Northland Power states that guidance will be for $345 to $355 million of EBITDA for 2014 and $380 to $400 million for 2015.While Algonquin Power is on track to hit $340 to $350 million of EBITDA in 2014.
New Facilities
Three contracted wind facilities have been added to the fleet as well as the Shepard Energy centre;it is firing now and will begin commercial operations in early 2015.The K2 wind project will be completed in Q2 2015.Funds from operations were $83 million compared to the same quarter in 2013.This blog expects that funds flow will be higher in Q4 and throughout 2015.
The rest of the Year
First investors should see that CPX is still quite a bit bigger than it's junior competitors,namely,Algonquin and Northland Power.But the other two are taking great strides to catch up to Capital Power.Of the two Algonquin is relying too much on one kind of investment in one jurisdiction .Also Capital is building it's facilities while Algonquin is acquiring them.But both Algonquin and Northland are very efficient at what they do as EBITDA for all three will be in a small range for 2014 and likely 2015.This blog believes that Capital Power is a very solid investment but needs to diversify it's assets so it doesn't have another bad summer.
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