Algonquin Power shows new Liberty Utilities
On March 2 Algonquin Power released it's fourth quarter and annual results.Operational performance was good as expected but Algonquin did reveal a few surprises.Most investors thought that AQN would never close the deal for Empire District Electric but it closed on January 1,2017.It has become part of Liberty Utilities.Empire adds 218,000 new customers to the Algonquin portfolio.Also their Renewable Generation Group added 360 MW of installed capacity.Algonquin Power informs shareholders that it added $21 million from successful rate outcomes in 2016 with another $14 million pending. It seems like a very successful year.
Operational Data
Algonquin had annual revenues of $1.096 billion for a 7% increase over 2016;and annual adjusted EBITDA of $477 million for an increase of 27%.While annual adjusted net earnings of $.57 per share showed an increase of 24% over 2016.All solid results!And fourth quarter results were ahead of the pace set by 2016 annual results.Fourth quarter revenues were $310 million and adjusted EBITDA was at $138 million and net earnings was at $.18 per share.These figures portend that 2017 will be better than the2016 figures.
Other posts on Workathon have covered different aspects of Algonquin Power performance.My blog on August 31,2016 discussed the increase in earnings expected from their two new systems called Park Water system and the O'Dell wind farm.Both are American systems see Aug.31,2016 workathon for details.Both are now part of Liberty Utilities.Another blog on Workathon tells of the new equity that was raised to help pay for the Empire acquisition;about 8 million shares were raised at $10.60 per share putting downward pressure on AQN shares see Workathon dated Jan.12.2017.
Liberty Utilities Emerges
It is clear that Algonquin Power has made a number of sacrifices to create and build earning assets;most of which are a part of Liberty Utilities.Some of these assets (including Empire Electric) have taken a large investment to be refurbished.The Renewable Generation Group (a part of Liberty Utilities) has acquired 360MW of installed capacity all of which is renewable energy.All of the assets in this group appear to have been built "from scratch".In total, Liberty Utilities seems to have assets with generating capacity of from 1760 MW to 2160 MW (with 340 MW in construction).
What's Next?
This blog has made several posts about their new American investments,in particular,the regulated ones.Last year AQN added the Park Water system and the O'dell wind farm.Now surprisingly they have added the Empire Electric plus another 360 MW of renewable resources.Liberty Utilities now has 1760 to 2160 of generating capacity.It is true that it will take more time and investment to get Empire running smoothly.Algonquin tells us that they also have a new listing on the NYSE.This blog recommends that Algonquin add a new listing on the NYSE for Liberty Utilities this year and sell equity here.Liberty Utilities is seen as a potential windfall if handled right and they should sell in 2017 up to 30 to 35% back for new funds.A new listing for Liberty on the NYSE is seen by this blog as putting Algonquin Power up to $15 by mid-year.
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