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Pattern Energy Reports Fourth Quarter and Year End 2016 Financial Results

By Pattern Energy Operations LP
March 1st, 2017
PR Newswire

San Francisco, March 1, 2017 /CNW/ -- Pattern Energy Group Inc. (the "Company" or "Pattern Energy") (NASDAQ: PEGI) (TSX: PEG) today announced its financial results for the 2016 fourth quarter and year.

pattern_logo.jpg

Highlights

(Comparisons made between fiscal 2016 and fiscal 2015 results, unless otherwise noted)

  • Proportional GWh sold of 6,806 GWh, up 33%
  • Net cash provided by operating activities of $164 million, up 39%
  • Cash available for distribution (CAFD) of $133.0 million, up 44%
  • Net loss of $52.3 million, an improvement of 6%
  • Adjusted EBITDA of $304.2 million, up 21%
  • Revenue of $354.1 million, up 7%
  • Declared a first quarter dividend of $0.41375 per Class A common share or $1.655 on an annualized basis, subsequent to the end of the period, representing a 1.4% increase over the previous quarter's dividend and the twelfth consecutive dividend increase
  • Increased owned capacity by 16% to 2,644 MW during 2016 with the acquisition of a 90 MW owned interest in the Armow project and an agreement to acquire a 272 MW owned interest in the Broadview projects, including the associated interconnect transmission line
  • Reported construction progress is on schedule at Broadview and the commencement of commercial operations is expected in April 2017, at which time Pattern Energy has agreed to acquire its owned interest
  • Completed a $350 million senior notes offering at 5.875% which matures in 2024, subsequent to the end of the period

"We delivered 44 percent growth in our cash available for distribution in 2016 which is approximately the midpoint of our guidance range. Our high-quality portfolio of 18 assets continues to supply stable cash flows. The outlook for renewables has never been stronger as technology improvements continue to drive the delivered cost of power lower.  Lower technology costs and our proven ability to develop new investment opportunities position us to continue to achieve high growth rates for the next several years and beyond," said Mike Garland, President and CEO of Pattern Energy. "In order to deliver on this potential, in September we launched an internal initiative called Pattern 2020 that outlined our vision for the business through 2020. The Pattern 2020 vision has three goals: 1) to make Pattern the best place to work in the industry; 2) to double the size of our portfolio; and 3) to continue to be a top competitor, which will include aggressively lowering our costs through operational initiatives, improved systems and automation and other actions. It's a vision that brings focus throughout the whole organization as we execute our day-to-day work to deliver safe, reliable, low cost renewable energy to communities."

Financial Results

Pattern Energy sold 1,817,651 MWh of electricity on a proportional basis in the fourth quarter of 2016 compared to 1,714,884 MWh sold for the same period in 2015. Pattern Energy sold 6,806,272 MWh of electricity on a proportional basis for the year ended December 31, 2016 (the "full year 2016"), compared to 5,136,675 MWh sold in 2015. The increase for the quarterly period is primarily due to the commencement of commercial operations of Amazon Wind Farm Fowler Ridge in December 2015 and the acquisition of Armow in the fourth quarter of 2016. Overall, production was modestly below the Company's expectation for the fourth quarter compared to its long-term forecast. The increase in proportional MWh sold for the annual period was primarily attributable to a 1,425,038 MWh increase in volume from controlling interest in consolidated MWh and a 244,559 MWh increase in volume from unconsolidated investments due to the acquisitions of Armow in October 2016 and K2 in June 2015.

Net cash provided by operating activities was $56.3 million for the fourth quarter of 2016 compared to $32.4 million for the same period in 2015. The change quarter over quarter is primarily due to increases in working capital of $13.5 million, increased distributions from unconsolidated investments of $14.6 million and decreased cash payments for interest of $2.9 million. These increases were partially offset by decreases in revenues of $4.1 million (excluding unrealized loss on energy derivative and amortization of PPAs) primarily due to decreases in MWh sold and increases in operating expenses of $2.2 million.

Net cash provided by operating activities was $163.7 million for the full year 2016 compared to $117.8 million in 2015, an increase of $45.8 million, or approximately 38.9%. The increase was primarily due to higher revenues of $47.3 million (excluding unrealized loss on energy derivative and amortization of PPAs) from projects which were acquired since May 2015 or which commenced commercial operations since September 2015, increased distributions from unconsolidated investments of $15.0 million, increased working capital of $4.1 million, a decrease in transaction costs of $3.1 million, and a $2.4 million increase in related party income. These increases were partially offset by increased project expenses of $14.2 million and operating expenses of $13.1 million.

Cash available for distribution was $36.2 million in the fourth quarter of 2016 compared to $32.9 million for the same period in 2015. The $3.3 million increase in cash available for distribution is due to increases of $5.5 million in distributions from unconsolidated investments, a $4.2 million increase in network upgrade reimbursements, increased related party income of $0.7 million, decreased net losses on transactions of $0.7 million, decreased project expenses of $0.7 million, and decreased principal payments of $0.7 million. These increases were partially offset by decreases in revenues of $4.1 million (excluding unrealized loss on energy derivative and amortization of PPAs) due primarily to decreases in volumes, increases in operating expenses of $2.2 million, and increased distributions to noncontrolling interests of $2.6 million.

Cash available for distribution was $133.0 million for the full year 2016 compared to $92.4 million for 2015. Based on dividends paid during 2016, Pattern Energy's dividend payout ratio was 90% of 2016 cash available for distribution. The $40.5 million increase in cash available for distribution was due to additional revenues of $47.3 million (excluding unrealized loss on energy derivative and amortization of PPAs) primarily from projects which were acquired or commenced commercial operations during 2015. In addition, the Company received an increase of $22.5 million in cash distributions from its unconsolidated investments when compared to the same period in the prior year which was due to full year operations at K2 and the acquisition of Armow in the fourth quarter of 2016, reduced principal payments of project-level debt by $6.4 million, decreased net losses on transactions of $3.1 million, and increased related party income of $2.4 million. These increases were partially offset by increased project expenses of $14.2 million, operating expenses of $13.1 million, increased distributions to noncontrolling interests of $10.0 million, and the $6.2 million cash distribution from the partial refund of a deposit associated with the Gulf Wind energy derivative in 2015. Reconciliations of cash available for distribution to net cash provided by operating activities determined in accordance with GAAP for both the quarterly and annual periods are shown below.

Net income was $3.4 million in the fourth quarter of 2016, compared to a net loss of $3.9 million for the same period in 2015. The improvement in the quarterly period was primarily due to other income items related to gains on undesignated derivatives and lower interest expense. These improvements were offset by decreased revenues (including the unrealized loss on energy derivative) as well as increased operating expenses.

Net loss was $52.3 million for the full year 2016 compared to $55.6 million for 2015. The improvement in net loss for the annual period was primarily due to increased earnings in unconsolidated investments and increased revenues, partially offset by increased project expense, operating expenses and tax provision.

Adjusted EBITDA was $85.1 million for the fourth quarter of 2016 compared to $78.3 million for the same period in 2015. Adjusted EBITDA for the full year 2016 was $304.2 million compared to $250.5 million for 2015. The increase for the quarterly period was primarily attributable to the commencement of commercial operations of Amazon Wind Farm Fowler Ridge in December 2015 and the acquisition of Armow in the fourth quarter of 2016. The increase in the annual period was primarily due to projects that were acquired or commenced commercial operation in 2015 and 2016. Reconciliations of Adjusted EBITDA to net loss determined in accordance with GAAP for both the quarterly and annual periods are shown below.

2017 Financial Guidance

For 2017, Pattern Energy expects annual cash available for distribution in a range of $140 million to $165 million, representing an increase of 15% at the midpoint of the range, compared to cash available for distribution in 2016.(*)

(*) 

 The forward looking measure of 2017 full year cash available for distribution (CAFD) is a non-GAAP measure that cannot be reconciled to net cash provided by operating activities as the most directly comparable GAAP financial measure without unreasonable effort primarily because of the uncertainties involved in estimating forward-looking changes in working capital balances which are added to earnings to arrive at cash provided by operations and subtracted therefrom to arrive at CAFD. A description of the adjustments to determine CAFD can be found within Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations - Key Metrics, of Pattern Energy's 2016 Annual Report on Form 10-K for the period ended December 31, 2016.

Quarterly Dividend

Pattern Energy declared an increased dividend for the first quarter 2017, payable on April 28, 2017, to holders of record on March 31, 2017 in the amount of $0.41375 per Class A common share, which represents $1.655 on an annualized basis. This is a 1.4% increase from the fourth quarter 2016 dividend of $0.408.

Construction Pipeline

The table below outlines the Broadview projects that Pattern Energy has agreed to acquire, which are currently in construction, the capacity owned and the projects' anticipated commencement date for commercial operation.

               

MW

Project

 

Location

 

Construction
Start

 

Commercial
Operations (1)

 

Rated (2)

 

Owned

Broadview projects

 

New Mexico

 

2016

 

2017

 

324

 

272

   

(1)

Represents year of actual or anticipated commencement of commercial operations.

   

(2)

Rated capacity represents the maximum electricity generating capacity of a project in MW. As a result of wind and other conditions, a project or a turbine may not operate at its rated capacity at all times and the amount of electricity generated will be less than its rated capacity. The amount of electricity generated may vary based on a variety of factors.

   

Acquisitions

In October 2016, Pattern Energy acquired 90 MW of owned capacity in the 179 MW Armow project from Pattern Development 1.0 for approximately US $133.0 million. The purchase price was funded from cash available and draws under the Company's revolving credit facility.

Located in Kincardine, Ontario, Armow consists of 91 Siemens 2.3 MW wind turbines and is jointly owned by Pattern Energy and Samsung Renewable Energy, Inc. The facility reached commercial operation in December 2015 and operates under a 20-year power purchase agreement with the Independent Electricity System Operator (IESO) in Ontario.

Acquisition Pipeline

Pattern Energy has the Right of First Offer (ROFO) on a pipeline of acquisition opportunities from Pattern Development 1.0 and Pattern Development 2.0 (together, the "Pattern Development Companies"). The identified ROFO list stands at 962 MW of total owned capacity. The list of identified ROFO projects represents a portion of the Pattern Development Companies' 5,900 MW pipeline of development projects, all of which are subject to Pattern Energy's ROFO.

Since its IPO, Pattern Energy has purchased 1,194 MW from Pattern Development 1.0 and in aggregate grown the identified ROFO list from 746 MW to a total of 2,156 MW. Below is a summary of the Identified ROFO Projects that the Company expects to acquire from the Pattern Development Companies in connection with Pattern Energy's project purchase rights:

                       

Capacity (MW)

Identified
ROFO Projects

 

Status

 

Location

 

Construction
Start(1)

 

Commercial
Operations(2)

 

Contract
Type

 

Rated(3)

 

Owned
Capacity(4)

Pattern Development 1.0 Projects

                       

Kanagi Solar

 

Operational

 

Japan

 

2014

 

2016

 

PPA

 

14

 

6

Futtsu Solar

 

Operational

 

Japan

 

2014

 

2016

 

PPA

 

42

 

19

Conejo Solar

 

Operational

 

Chile

 

2015

 

2016

 

PPA

 

104

 

104

Meikle

 

Operational

 

British Columbia

 

2015

 

2017

 

PPA

 

180

 

180

Belle River

 

In construction

 

Ontario

 

2016

 

2017

 

PPA

 

100

 

43

Ohorayama

 

In construction

 

Japan

 

2016

 

2018

 

PPA

 

33

 

31

Mont Sainte-Marguerite

 

In construction

 

Québec

 

2017

 

2017

 

PPA

 

147

 

147

Henvey Inlet

 

Late stage development

 

Ontario

 

2017

 

2018

 

PPA

 

300

 

150

North Kent

 

Late stage development

 

Ontario

 

2017

 

2018

 

PPA

 

100

 

43

Tsugaru

 

Late stage development

 

Japan

 

2017

 

2019

 

PPA

 

126

 

63

Pattern Development 2.0 Projects

                       

Grady

 

Late stage development

 

New Mexico

 

2018

 

2019

 

PPA

 

220

 

176

                       

1,366

 

962

                                 

(1)

Represents year of actual or anticipated commencement of construction.

   

(2)

Represents year of actual or anticipated commencement of commercial operations.

   

(3)

Rated capacity represents the maximum electricity generating capacity of a project in MW. As a result of wind and other conditions, a project or a turbine will not operate at its rated capacity at all times and the amount of electricity generated may be less than its rated capacity. The amount of electricity generated may vary based on a variety of factors.

   

(4)

Owned capacity represents the maximum, or rated, electricity generating capacity of the project in MW multiplied by either Pattern Development 1.0's or Pattern Development 2.0's percentage ownership interest in the distributable cash flow of the project.

   

Cash Available for Distribution and Adjusted EBITDA Non-GAAP Reconciliations

The following tables reconcile non-GAAP net cash provided by operating activities to cash available for distribution and net loss to Adjusted EBITDA, respectively, for the periods presented (in thousands):

 

Three months ended December 31,

 

For the year ended December 31,

 

2016

 

2015

 

2016

 

2015

Net cash provided by operating activities

$

56,293

   

$

32,447

   

$

163,664

   

$

117,849

 

Changes in operating assets and liabilities

(11,800)

   

1,669

   

(11,000)

   

(6,880)

 

Network upgrade reimbursement

4,821

   

618

   

4,821

   

2,472

 

Release of restricted cash to fund project and general and administrative costs

50

   

110

   

640

   

1,611

 

Operations and maintenance capital expenditures

(138)

   

(485)

   

(1,017)

   

(779)

 

Distributions from unconsolidated investments

1,632

   

10,722

   

41,698

   

34,216

 

Reduction of other asset - Gulf Wind energy derivative deposit

   

850

   

   

6,205

 

Other

(172)

   

(596)

   

(302)

   

(323)

 

Less:

             

Distributions to noncontrolling interests

(6,125)

   

(3,500)

   

(17,896)

   

(7,882)

 

Principal payments paid from operating cash flows

(8,312)

   

(8,984)

   

(47,634)

   

(54,041)

 

Cash available for distribution

$

36,249

   

$

32,851

   

$

132,974

   

$

92,448

 

 

 

Three months ended December 31,

 

For the year ended December 31,

 

2016

 

2015

 

2016

 

2015

Net income

$

3,445

   

$

(3,873)

   

$

(52,299)

   

$

(55,607)

 

Plus:

             

Interest expense, net of interest income

15,692

   

18,886

   

76,598

   

75,309

 

Tax provision

4,641

   

4,267

   

8,679

   

4,943

 

Depreciation, amortization and accretion

47,028

   

41,240

   

184,002

   

145,322

 

EBITDA

70,806

   

60,520

   

216,980

   

169,967

 

Unrealized loss on energy derivative (1)

7,797

   

2,391

   

22,767

   

791

 

Loss on undesignated derivatives, net

(14,361)

   

1,908

   

3,324

   

5,490

 

Realized loss on designated derivatives

   

   

   

11,221

 

Early extinguishment of debt

   

828

   

   

4,941

 

Net gain (loss) on transactions

(27)

   

737

   

326

   

3,400

 

Adjustments from unconsolidated investments (2)

18,914

   

   

(659)

   

 

Plus, proportionate share from equity accounted investments:

             

Interest expense, net of interest income

9,325

   

6,452

   

32,103

   

23,537

 

Depreciation, amortization and accretion

8,139

   

6,434

   

27,763

   

22,680

 

Loss on undesignated derivatives, net

(15,463)

   

(1,017)

   

1,552

   

8,514

 

Adjusted EBITDA

$

85,130

   

$

78,253

   

$

304,156

   

$

250,541

 
   

(1)

Amount is included in electricity sales on the consolidated statements of operations.

   

(2)

Adjustments from unconsolidated investments for the three months ended December 31, 2016, consists of $4.9 million gains on distributions from unconsolidated investments and $(23.8) million of suspended equity earnings. Adjustments for the year ended December 31, 2016, consists of $19.9 million gains on distributions from unconsolidated investments and $(19.2) million of suspended equity earnings.

Conference Call and Webcast

Pattern Energy will host a conference call and webcast, complete with slide presentation, to discuss these results at 10:30 a.m. Eastern Time on Wednesday, March 1, 2017. Mike Garland, President and CEO, and Mike Lyon, CFO, will co-chair the call. Participants should call (888) 231-8191 or (647) 427-7450 and ask an operator for the Pattern Energy earnings call. Please dial in 10 minutes prior to the call to secure a line. A replay will be available shortly after the call. To access the replay, please dial (855) 859-2056 or (416) 849-0833 and enter access code 74242722. The replay recording will be available until 11:59 p.m. Eastern Time, March 22, 2017.

A live webcast of the conference call will be also available on the events page in the investor section of Pattern Energy's website at www.patternenergy.com. An archived webcast will be available for one year.

About Pattern Energy

Pattern Energy Group Inc. (Pattern Energy) is an independent power company listed on The NASDAQ Global Select Market and Toronto Stock Exchange. Pattern Energy has a portfolio of 18 wind power facilities, including one it has agreed to acquire, with a total owned interest of 2,644 MW in the United States, Canada and Chile that use proven, best-in-class technology. Pattern Energy's wind power facilities generate stable long-term cash flows in attractive markets and provide a solid foundation for the continued growth of the business. For more information, visit www.patternenergy.com.

Cautionary Statement Regarding Forward-Looking Statements

Certain statements contained in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 and "forward-looking information" within the meaning of Canadian securities laws, including statements regarding the ability to grow CAFD and to achieve the 2017 CAFD estimate, the Company's ability to achieve high growth rates in the future, the ability to achieve the goals of the Pattern 2020 vision, the ability to continue to grow the list of ROFO assets in 2017, and the ability to complete the Broadview projects. These forward-looking statements represent the Company's expectations or beliefs concerning future events, and it is possible that the results described in this press release will not be achieved. These forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of the Company's control, which could cause actual results to differ materially from the results discussed in the forward-looking statements.

Any forward-looking statement speaks only as of the date on which it is made, and, except as required by law, the Company does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. New factors emerge from time to time, and it is not possible for the Company to predict all such factors. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements in the Company's annual report on Form 10-K and any quarterly reports on Form 10-Q. The risk factors and other factors noted therein could cause actual events or the Company's actual results to differ materially from those contained in any forward-looking statement.

 

Contacts:

       

Media Relations

Matt Dallas

917-363-1333

matt.dallas(at)patternenergy.com

 

Investor Relations

Ross Marshall

416-526-1563

ross.marshall(at)loderockadvisors.com

 
 
 

Pattern Energy Group Inc.

Consolidated Balance Sheets

(In thousands of U.S. dollars, except share data)

   
 

December 31,

 

2016

 

2015

Assets

     

Current assets:

     

Cash and cash equivalents

$

83,932

   

$

94,808

 

Restricted cash

11,793

   

14,609

 

Funds deposited by counterparty

43,635

   

 

Trade receivables

37,510

   

45,292

 

Related party receivable

1,134

   

734

 

Reimbursable interconnection costs

   

38

 

Derivative assets, current

17,578

   

24,338

 

Prepaid expenses

13,803

   

14,498

 

Other current assets

6,216

   

6,891

 

Deferred financing costs, current, net of accumulated amortization of $9,350 and $5,192 as of December 31, 2016 and December 31, 2015, respectively

2,456

   

2,121

 

Total current assets

218,057

   

203,329

 

Restricted cash

13,646

   

36,875

 

Property, plant and equipment, net

3,135,162

   

3,294,620

 

Unconsolidated investments

233,294

   

116,473

 

Derivative assets

26,712

   

44,014

 

Deferred financing costs

4,052

   

4,572

 

Net deferred tax assets

5,559

   

6,804

 

Finite-lived intangible assets, net

91,895

   

97,722

 

Other assets

24,390

   

25,183

 

Total assets

$

3,752,767

   

$

3,829,592

 

Liabilities and equity

     

Current liabilities:

     

Accounts payable and other accrued liabilities

$

31,305

   

$

42,776

 

Accrued construction costs

1,098

   

23,565

 

Counterparty deposit liability

43,635

   

 

Related party payable

1,295

   

1,646

 

Accrued interest

9,545

   

9,035

 

Dividends payable

35,960

   

28,022

 

Derivative liabilities, current

11,918

   

14,343

 

Revolving credit facility

180,000

   

355,000

 

Current portion of long-term debt, net

48,716

   

44,144

 

Other current liabilities

3,403

   

2,156

 

Total current liabilities

366,875

   

520,687

 

Long-term debt, net

1,334,956

   

1,371,742

 

Derivative liabilities

24,521

   

28,659

 

Net deferred tax liabilities

31,759

   

22,183

 

Finite-lived intangible liability, net

54,663

   

58,132

 

Other long-term liabilities

61,249

   

52,427

 

Total liabilities

1,874,023

   

2,053,830

 

Commitments and contingencies

     

Equity:

     

Class A common stock, $0.01 par value per share: 500,000,000 shares authorized; 87,410,687 and 74,644,141 shares outstanding as of December 31, 2016 and December 31, 2015, respectively

875

   

747

 

Additional paid-in capital

1,145,760

   

982,814

 

Accumulated loss

(94,270)

   

(77,159)

 

Accumulated other comprehensive loss

(62,367)

   

(73,325)

 

Treasury stock, at cost; 110,964 and 65,301 shares of Class A common stock as of December 31, 2016 and December 31, 2015, respectively

(2,500)

   

(1,577)

 

Total equity before noncontrolling interest

987,498

   

831,500

 

Noncontrolling interest

891,246

   

944,262

 

Total equity

1,878,744

   

1,775,762

 

Total liabilities and equity

$

3,752,767

   

$

3,829,592

 
 
 

Pattern Energy Group Inc.

Consolidated Statements of Operations

(In thousands of U.S. dollars, except per share data)

 
 

Three months ended December 31,

 

For the year ended December 31,

 

2016

 

2015

 

2016

 

2015

Revenue:

             

Electricity sales

$

79,048

   

$

89,023

   

$

346,000

   

$

324,275

 

Related party revenue

1,672

   

1,010

   

5,793

   

3,640

 

Other revenue

341

   

564

   

2,259

   

1,916

 

Total revenue

81,061

   

90,597

   

354,052

   

329,831

 

Cost of revenue:

             

Project expense

31,863

   

32,544

   

128,852

   

114,619

 

Depreciation and accretion

43,708

   

41,379

   

174,490

   

143,376

 

Total cost of revenue

75,571

   

73,923

   

303,342

   

257,995

 

Gross profit

5,490

   

16,674

   

50,710

   

71,836

 

Operating expenses:

             

General and administrative

9,451

   

7,498

   

40,573

   

29,807

 

Related party general and administrative

2,519

   

2,273

   

9,900

   

7,589

 

Total operating expenses

11,970

   

9,771

   

50,473

   

37,396

 

Operating income (expense)

(6,480)

   

6,903

   

237

   

34,440

 

Other income (expense):

             

Interest expense

(15,870)

   

(19,374)

   

(78,004)

   

(77,907)

 

Gain (loss) on undesignated derivatives, net

14,361

   

(1,908)

   

(3,324)

   

(5,490)

 

Realized loss on designated derivatives

   

   

   

(11,221)

 

Earnings (losses) in unconsolidated investments, net

14,437

   

15,351

   

30,192

   

16,119

 

Related party income

1,377

   

636

   

5,074

   

2,665

 

Early extinguishment of debt

   

(828)

   

   

(4,941)

 

Net gain (loss) on transactions

27

   

(737)

   

(326)

   

(3,400)

 

Other income (expense), net

234

   

351

   

2,531

   

(929)

 

Total other income (expense)

14,566

   

(6,509)

   

(43,857)

   

(85,104)

 

Net income (loss) before income tax

8,086

   

394

   

(43,620)

   

(50,664)

 

Tax provision

4,641

   

4,267

   

8,679

   

4,943

 

Net income (loss)

3,445

   

(3,873)

   

(52,299)

   

(55,607)

 

Net loss attributable to noncontrolling interest

(10,350)

   

(6,327)

   

(35,188)

   

(23,074)

 

Net income (loss) attributable to Pattern Energy

$

13,795

   

$

2,454

   

$

(17,111)

   

$

(32,533)

 

Weighted average number of shares:

             

Class A common stock - Basic and diluted

87,007,714

   

74,398,729

   

79,382,388

   

70,535,568

 

Loss per share

             

Class A common stock:

             

Basic and diluted gain (loss) per share

$

0.16

   

$

0.03

   

$

(0.22)

   

$

(0.46)

 

Dividends declared per Class A common share

$

0.41

   

$

0.37

   

$

1.58

   

$

1.43

 
 
 

Pattern Energy Group Inc.

Consolidated Statements of Cash Flows

(In thousands of U.S. dollars)

 
 

Three months ending December 31,

 

For the year ended December 31,

 

2016

 

2015

 

2016

 

2015

Operating activities

             

Net income (loss)

$

3,445

   

$

(3,873)

   

$

(52,299)

   

$

(55,607)

 

Adjustments to reconcile net loss to net cash provided by operating activities:

             

Depreciation and accretion

43,708

   

41,268

   

174,490

   

143,376

 

Amortization of financing costs

1,726

   

1,854

   

6,968

   

7,435

 

(Gain) loss on derivatives, net

(7,518)

   

1,426

   

22,239

   

2,219

 

Stock-based compensation

1,029

   

1,228

   

5,391

   

4,462

 

Deferred taxes

4,566

   

4,154

   

8,247

   

4,494

 

(Earnings) loss in unconsolidated investments, net

(14,437)

   

(15,367)

   

(30,192)

   

(16,180)

 

Distribution from unconsolidated investments

14,638

   

   

15,015

   

 

Amortization of power purchase agreements, net

771

   

771

   

3,049

   

1,946

 

Amortization of debt discount/premium, net

1,079

   

862

   

4,226

   

1,660

 

Realized loss on derivatives, net

   

1,029

   

   

11,221

 

Early extinguishment of debt

   

764

   

   

4,722

 

Other reconciling items

(4,514)

   

   

(4,470)

   

1,221

 

Changes in operating assets and liabilities:

             

Funds deposited by counterparty

3,008

   

   

(43,635)

   

 

Trade receivables

1,718

   

(7,911)

   

7,796

   

(2,254)

 

Prepaid expenses

1,714

   

(2,722)

   

709

   

1,272

 

Other current assets

(355)

   

3,654

   

(3,909)

   

(2,929)

 

Other assets (non-current)

514

   

(314)

   

1,379

   

(2,336)

 

Accounts payable and other accrued liabilities

112

   

536

   

(2,546)

   

4,716

 

Counterparty deposit liability

(3,008)

   

   

43,635

   

 

Related party receivable/payable

(906)

   

205

   

(742)

   

711

 

Accrued interest

6,475

   

2,519

   

458

   

4,489

 

Other current liabilities

735

   

(249)

   

1,227

   

515

 

Long-term liabilities

1,793

   

2,613

   

6,628

   

2,696

 

Net cash provided by operating activities

56,293

   

32,447

   

163,664

   

117,849

 
               

Investing activities

             

Cash paid for acquisitions, net of cash and restricted cash acquired

(131,754)

   

(27,508)

   

(135,778)

   

(422,413)

 

Capital expenditures

(1,347)

   

(64,504)

   

(32,901)

   

(380,458)

 

Distribution from unconsolidated investments

1,632

   

14,746

   

41,698

   

38,240

 

Other assets

1,077

   

909

   

2,696

   

5,559

 

Other investing activities

167

   

(4)

   

31

   

(3)

 

Net cash used in investing activities

(130,225)

   

(76,361)

   

(124,254)

   

(759,075)

 

Financing activities

             

Proceeds from public offering, net of issuance costs

(285)

   

(390)

   

286,298

   

317,432

 

Proceeds from issuance of convertible senior notes, net of issuance costs

   

(628)

   

   

218,929

 

Repurchase of shares for employee tax withholding

(859)

   

(529)

   

(923)

   

(860)

 

Dividends paid

(35,048)

   

(27,127)

   

(120,207)

   

(90,582)

 

Payment for deferred equity issuance costs

   

1,940

   

   

 

Buyout of noncontrolling interest

   

   

   

(121,224)

 

Capital contributions - noncontrolling interest

   

142,979

   

   

336,043

 

Capital distributions - noncontrolling interest

(6,125)

   

(3,500)

   

(17,896)

   

(7,882)

 

Refund of deposit for letters of credit

   

   

   

3,425

 

Payment for deferred financing costs

(408)

   

(5,222)

   

(542)

   

(13,667)

 

Proceeds from revolving credit facility

155,000

   

110,000

   

175,000

   

405,000

 

Repayment of revolving credit facility

(10,000)

   

   

(350,000)

   

(100,000)

 

Proceeds from construction loans

   

34,568

   

   

329,070

 

Proceeds from long-term debt

   

164,973

   

   

164,973

 

Repayment of long-term debt

(8,312)

   

(380,887)

   

(47,634)

   

(785,923)

 

Payment for interest rate derivatives

   

   

   

(11,061)

 

Other financing activities

(189)

   

   

(759)

   

 

Net cash provided by (used in) financing activities

93,774

   

36,177

   

(76,663)

   

643,673

 

Effect of exchange rate changes on cash, cash equivalents and restricted cash

(1,418)

   

(1,474)

   

332

   

(5,501)

 

Net change in cash, cash equivalents and restricted cash

18,424

   

(9,211)

   

(36,921)

   

(3,054)

 

Cash, cash equivalents and restricted cash at beginning of period

90,947

   

155,503

   

146,292

   

149,346

 

Cash, cash equivalents and restricted cash at end of period

$

109,371

   

$

146,292

   

$

109,371

   

$

146,292

 

Supplemental disclosures

             

Cash payments for income taxes

$

142

   

$

49

   

$

375

   

$

342

 

Cash payments for interest expense, net of capitalized interest

10,494

   

13,368

   

69,666

   

62,607

 

Acquired property, plant and equipment from acquisitions

   

2,122

   

   

581,834

 

Schedule of non-cash activities

             

Change in fair value of designated interest rate swaps

$

   

$

   

$

     

Change in property, plant and equipment

430

   

(5,049)

   

540

   

15,695

 

Non-cash increase in additional paid-in capital from buyout of noncontrolling interests

   

   

   

16,715

 

Equity issuance costs paid in prior period related to current period offerings

   

   

   

433

 

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/pattern-energy-reports-fourth-quarter-and-year-end-2016-financial-results-300415751.html

SOURCE: Pattern Energy Group Inc.

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