Atlantic Power is still cleaning ship
On August8,2016 Atlantic Power released it's second quarter results; they were not dramatic.It showed a net loss of $18.5 million versus $15 million net income in Q2 2015.
Project income gains were offset by a non-cash financing charge in 2016.In contrast,the 2015 results included income from a gain on the sale of the discontinued wind operations.However project income was $25 million versus $17 million in 2015;this included a decrease from the outage of their Manchief generating station.Importantly project adjusted EBITDA was $46 million compared to $44 million in the same quarter in 2015.This is taken as our best measure of performance.All in all there were slight improvements in most categories and this blog feels that Atlantic Power is on track to hit adjusted EBITDA of $200 to $225 million for 2016.This would be roughly equal to $1.70 to $1.85 per share.
6 months Results
Atlantic Power reported a net loss of $34 million versus net income of $32 million for 2015.This was chiefly because of a number of non-cash items including deferred financing charges and foreign exchange losses.As project income rose to $54 million from $39 million in the second quarter of 2015.And more importantly adjusted EBITDA was $109 million versus $102 million in 2015.Their six month leverage ratio is just below 6 times EBITDA and this is a little high for an utility.
Balance Sheet Initiatives
ATP did some refinancing and as a result has gained more flexibility and extended it's maturity dates to 2019 and 2020.It used it's new financing to redeem $111 million of it's 2017 convertible debentures.It also repurchased $62 million of it's series C convertible debentures while $43 million remains outstanding. More important for shareholders ATP also repurchased 1.5 million common shares for $3.6 million.There remains about $40 million of net proceeds to be used for debt and equity purchases and growth investments.They also repaid $25 million of term loans and $2 million debt from operating cash flow.And they expect to repay $35 million of term loans and $7 million of debt for the second half of 2016.
2016 Earnings per Share
The question remains what will the earnings be for 2016?Some financial websites like Qtrade and Yahoo Finance show negative earnings for 2016.This is not likely to happen as project adjusted EBITDA was $109 million for the first half and will likely be around $200 to $225 million for the full year.Revenues are slowly increasing as is project income.Earnings could only possibly be negative if cash flow was used as the measure of earnings.Then many non-cash items could turn cash flow negative.And even cash flow will be helped this year by the reduction of the dividend for an almost $15 million saving.
The most likely forecast of earnings per share would be $1.75 per share and this makes the price/earnings ratio of about 2 times.Although ATP does not pay a dividend now 2 times earnings is still too low for a slow but steadily growing utility. see Blogdaleupsome for recnt e.p.s. and price forecast ;use Blogdaleupsome for analysis of utility stocks
Project income gains were offset by a non-cash financing charge in 2016.In contrast,the 2015 results included income from a gain on the sale of the discontinued wind operations.However project income was $25 million versus $17 million in 2015;this included a decrease from the outage of their Manchief generating station.Importantly project adjusted EBITDA was $46 million compared to $44 million in the same quarter in 2015.This is taken as our best measure of performance.All in all there were slight improvements in most categories and this blog feels that Atlantic Power is on track to hit adjusted EBITDA of $200 to $225 million for 2016.This would be roughly equal to $1.70 to $1.85 per share.
6 months Results
Atlantic Power reported a net loss of $34 million versus net income of $32 million for 2015.This was chiefly because of a number of non-cash items including deferred financing charges and foreign exchange losses.As project income rose to $54 million from $39 million in the second quarter of 2015.And more importantly adjusted EBITDA was $109 million versus $102 million in 2015.Their six month leverage ratio is just below 6 times EBITDA and this is a little high for an utility.
Balance Sheet Initiatives
ATP did some refinancing and as a result has gained more flexibility and extended it's maturity dates to 2019 and 2020.It used it's new financing to redeem $111 million of it's 2017 convertible debentures.It also repurchased $62 million of it's series C convertible debentures while $43 million remains outstanding. More important for shareholders ATP also repurchased 1.5 million common shares for $3.6 million.There remains about $40 million of net proceeds to be used for debt and equity purchases and growth investments.They also repaid $25 million of term loans and $2 million debt from operating cash flow.And they expect to repay $35 million of term loans and $7 million of debt for the second half of 2016.
2016 Earnings per Share
The question remains what will the earnings be for 2016?Some financial websites like Qtrade and Yahoo Finance show negative earnings for 2016.This is not likely to happen as project adjusted EBITDA was $109 million for the first half and will likely be around $200 to $225 million for the full year.Revenues are slowly increasing as is project income.Earnings could only possibly be negative if cash flow was used as the measure of earnings.Then many non-cash items could turn cash flow negative.And even cash flow will be helped this year by the reduction of the dividend for an almost $15 million saving.
The most likely forecast of earnings per share would be $1.75 per share and this makes the price/earnings ratio of about 2 times.Although ATP does not pay a dividend now 2 times earnings is still too low for a slow but steadily growing utility. see Blogdaleupsome for recnt e.p.s. and price forecast ;use Blogdaleupsome for analysis of utility stocks
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