Northland Power ahead of schedule and on budget
Northland Power just released a press release giving some details on it's Nordsee One project in the North Sea;it is an offshore wind project 40 kilometres north of Juist Island off the German coast.When completed it will have 54 turbines and 332 MW of power.Northland has already declared the financial close on the Nordsee One project;it's financing has been already arranged.Now it has announced that it is on budget and ahead of schedule.Northland has also announced that another project the Nordsee Ost wind project has been completed and commissioned.It has 48 turbines and produces 295 MW of power.
Northland has made an agreement with the large German utility RWE to take a major share in the Nordsee projects.It will own 85% of Nordsee One , Two and Three and RWEowns 15%.It is not clear at this time if Northland has the same (or any ownership) in Nordsee Ost that has just been completed.If so this would surely be a "feather in their cap" as revenues and EBITDA will be coming onstream in the fourth quarter of 2015.
Nordsee One
In their recent press release Northland stated that the first steel foundation has been installed.Installation will continue throughout 2015 and 2016.The steel foundations have been installed in 25 to 29 meters of water.Nordsee One is expected to be operational in 2017.It reached this construction milestone ahead of schedule and on budget.Northland also reports that Nordsee One is considered to be in the Top 5 in the European offshore market although it is not yet operational.So presumably Europeans consider it to be more effective then Nordsee Ost.
The Impact on the Income Statement
The fact that the Nordsee One project is on budget is interesting but what impact does it have on earnings for the next quarter?Northland gave guidance saying that Nordsee One, Two and Three would be on budget.Any deviation here will cause a drain on the capital expenditure program and will put pressure on free cash flow and on the payout ratio.So Northland is giving new guidance saying that there will be no additional pressure on cash flow and on their payout ratio.
Also Northland took a hit to net income of almost $350 million for interest expense.This did not effect operational income but it did affect net income and in fact made it negative.But Northland has stated that the financing for Nordsee One has finshed.There will be no new interest charges because of Nordsee One in the next quarter.Also it is possible that there will be increased EBITDA coming from Nordsee Ost that could affect the income statement as early as the next quarter.This blog looks for increased guidance for revenues and EBITDA for 2016.Operational income went from $71 million in 2011 to $204 million in 2014 and should have little trouble hitting $250 million in 2015. use Blogdaleupsome for analysis of utilities; see Blogdaleupsome for analysis of utilities;use Blogdaleupsome for insight into utility stocks
Northland has made an agreement with the large German utility RWE to take a major share in the Nordsee projects.It will own 85% of Nordsee One , Two and Three and RWEowns 15%.It is not clear at this time if Northland has the same (or any ownership) in Nordsee Ost that has just been completed.If so this would surely be a "feather in their cap" as revenues and EBITDA will be coming onstream in the fourth quarter of 2015.
Nordsee One
In their recent press release Northland stated that the first steel foundation has been installed.Installation will continue throughout 2015 and 2016.The steel foundations have been installed in 25 to 29 meters of water.Nordsee One is expected to be operational in 2017.It reached this construction milestone ahead of schedule and on budget.Northland also reports that Nordsee One is considered to be in the Top 5 in the European offshore market although it is not yet operational.So presumably Europeans consider it to be more effective then Nordsee Ost.
The Impact on the Income Statement
The fact that the Nordsee One project is on budget is interesting but what impact does it have on earnings for the next quarter?Northland gave guidance saying that Nordsee One, Two and Three would be on budget.Any deviation here will cause a drain on the capital expenditure program and will put pressure on free cash flow and on the payout ratio.So Northland is giving new guidance saying that there will be no additional pressure on cash flow and on their payout ratio.
Also Northland took a hit to net income of almost $350 million for interest expense.This did not effect operational income but it did affect net income and in fact made it negative.But Northland has stated that the financing for Nordsee One has finshed.There will be no new interest charges because of Nordsee One in the next quarter.Also it is possible that there will be increased EBITDA coming from Nordsee Ost that could affect the income statement as early as the next quarter.This blog looks for increased guidance for revenues and EBITDA for 2016.Operational income went from $71 million in 2011 to $204 million in 2014 and should have little trouble hitting $250 million in 2015. use Blogdaleupsome for analysis of utilities; see Blogdaleupsome for analysis of utilities;use Blogdaleupsome for insight into utility stocks
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