Atlantic Power continues on track
Atlantic Power released it's third quarter results on November10.It was marginally better than results for the same quarter in 2015 but there were no big surprises.If there was a small surprise it was the taking of a $85 million impairment charge against project income.ATP tells us that project adjusted EBITDA was down $4.5 million from Q3 in 2015.But it was above that for Q2 and is still on track to hit $200 to $225 million for 2016.It continues to clean up it's balance sheet and reduce debt.
Balance Sheet Initiatives
Atlantic Power puts it's focus on the balance sheet; it took a $85 million impairment charge and repaid about $25 million of term loans.In addition, it repurchased 3.7 million shares at an average price of $2.44 per share.Also they repurchased $63 million of their outstanding convertible debentures.So their leverage ratio fell from 6.2 (earlier in the year)and 6.0 in the last quarter to 5.8 now. On the other hand,ATP did not make any new investments or start any new projects.It was a steady as she goes kind of quarter.Atlantic Power adds that over the next four years they expect to amortize $400 million of their term loans.And they expect to reduce overhead costs by another 10%.All of these actions will act to increase adjusted EBITDA over the next few years.
Free Cash Flow
As was said above this blog expects that adjusted EBITDA is ontrack to hit $ 200 to $225 million for the year with a reasonable fourth quarter.Counting the reductions in overhead costs and interest costs they should have a quarter better than the third quarter.But there may be extraordinary deductions from free cash flow that will reduce their free cash flow.Atlantic Power is performing better and is cleaning up it's balance sheet,especially reducing it's leverage ratio.But it will not likely offer investors a dividend, in early 2017 at least. use Blogdaleupsome for analysis of utilities; use Blogdaleupsome for business forecasts
Balance Sheet Initiatives
Atlantic Power puts it's focus on the balance sheet; it took a $85 million impairment charge and repaid about $25 million of term loans.In addition, it repurchased 3.7 million shares at an average price of $2.44 per share.Also they repurchased $63 million of their outstanding convertible debentures.So their leverage ratio fell from 6.2 (earlier in the year)and 6.0 in the last quarter to 5.8 now. On the other hand,ATP did not make any new investments or start any new projects.It was a steady as she goes kind of quarter.Atlantic Power adds that over the next four years they expect to amortize $400 million of their term loans.And they expect to reduce overhead costs by another 10%.All of these actions will act to increase adjusted EBITDA over the next few years.
As was said above this blog expects that adjusted EBITDA is ontrack to hit $ 200 to $225 million for the year with a reasonable fourth quarter.Counting the reductions in overhead costs and interest costs they should have a quarter better than the third quarter.But there may be extraordinary deductions from free cash flow that will reduce their free cash flow.Atlantic Power is performing better and is cleaning up it's balance sheet,especially reducing it's leverage ratio.But it will not likely offer investors a dividend, in early 2017 at least. use Blogdaleupsome for analysis of utilities; use Blogdaleupsome for business forecasts
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