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Pattern Energy Reports Third Quarter 2016 Financial Results

By Pattern Energy Operations LP
November 7th, 2016
PR Newswire

- Increases dividend to $0.408 per Class A common share for Q4 2016 -

San Francisco, Nov. 7, 2016 /PRNewswire/ -- Pattern Energy Group Inc. (the "Company" or "Pattern Energy") (NASDAQ: PEGI) (TSX: PEG) today announced its financial results for the 2016 third quarter.

pattern_logo.jpg

Highlights

(Comparisons made between fiscal Q3 2016 and fiscal Q3 2015 results, unless otherwise noted)

  • Proportional GWh sold of 1,472 GWh, up 17%
  • Net cash provided by operating activities of $36.4 million
  • Cash available for distribution (CAFD) of $20.2 million, on track to meet full year guidance(1)
  • Net loss of $11.1 million, an improvement of 69%
  • Adjusted EBITDA of $62.3 million, up 6%
  • Revenue of $91.9 million, up 2%
  • Declared a fourth quarter dividend of $0.408 per Class A common share or $1.632 on an annualized basis, subsequent to the end of the period, representing a 2.0% increase over the previous quarter's dividend
  • Added 90 MW in owned capacity with the acquisition of the Armow Wind project (Armow), located in Ontario, from Pattern Energy Group LP (Pattern Development), subsequent to the end of the period, which brings the total portfolio owned capacity to 2,644 MW, including the Broadview Wind projects (Broadview) which Pattern Energy has agreed to acquire
  • Reported construction progress is on schedule at Broadview, in which Pattern Energy has agreed to acquire a 272 MW owned capacity, and that the commencement of commercial operations is expected in early 2017
  • Completed a follow-on equity offering of 11.3 million common shares for total net proceeds of $258.6 million 

"Our fleet of high quality wind assets continues to perform well. Production was in line with our long-term forecast for Q3 as we expected with the dissipation of El Niño. With our solid production performance, we are on track to achieve our cash available for distribution target for 2016(1)," said Mike Garland, President and CEO of Pattern Energy.  "We successfully accessed the public capital markets during the quarter, raising approximately $286 million in growth capital to fund accretive new dropdowns. With that funding we have already acquired a 90 MW owned capacity in Armow from Pattern Development at a 9.5x to 10.5x average cash available for distribution multiple over five years.(1) With the addition of Broadview, which we expect will commence commercial operations late first quarter or early second quarter of 2017, our portfolio now totals 2,644 MW in owned interest. We also have clear visibility to 36% growth in total portfolio capacity from our identified ROFO list with Pattern Development. We have sufficient available liquidity to make additional dropdowns and we expect to grow the identified ROFO in the coming months as part of our plan to expand the portfolio to our target of 5 GW of owned capacity by the end of 2019."

(1) These forward looking measures of (a) 2016 full year cash available for distribution (CAFD) and (b) five-year average annual purchase price multiple of CAFD contribution from the Armow Wind project are non-GAAP measures 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 2, Management's Discussion and Analysis of Financial Condition and Results of Operations - Key Metrics, of Pattern Energy's 2016 Quarterly Report on Form 10-Q for the period ended September 30, 2016.

Financial and Operating Results

Pattern Energy sold 1,472,300 MWh of electricity on a proportional basis in the third quarter of 2016 compared to 1,260,385 MWh sold in the same period last year. Pattern Energy sold 4,988,621 MWh of electricity on a proportional basis for the nine months ended September 30, 2016 (YTD 2016) compared to 3,421,791 MWh sold in the same period last year. The increase for the quarterly period was primarily attributable to volume increases of 200,289 MWh from controlling interests in consolidated MWh primarily from projects which commenced operations since September 2015 and 11,626 MWh from unconsolidated investments. As expected, El Niño conditions subsided in the third quarter of 2016 which resulted in normalized production on a fleet basis at Pattern Energy's long-term average forecast.

Net cash provided by operating activities was $36.4 million for the third quarter of 2016 compared to $34.7 million for the same period last year. Net cash provided by operating activities was $105.4 million for YTD 2016 compared to $83.3 million for the same period last year. The change quarter over quarter is primarily due to higher revenues of $7.3 million (excluding unrealized loss on energy derivative and amortization of PPAs) from projects which were acquired since September 2015, as well as, to a lesser extent the timing of payments associated with accruals and other long term liabilities. These increases were partially offset by increases of $2.5 million in project expenses and $5.6 million in operating expenses.

Cash available for distribution was $20.2 million for the third quarter of 2016 compared to $22.3 million for the same period in the prior year. Cash available for distribution was $96.7 million for YTD 2016 compared to $59.6 million for the same period in the prior year. The $2.1 million decrease for the quarterly period was primarily due to the non-recurring partial refund of deposit associated with the Gulf Wind energy derivative of $5.4 million received in 2015 offset by a reduction in principal payments of $2.6 million. The $37.1 million increase in YTD 2016 was due to additional revenues of $51.4 million (excluding unrealized loss on energy derivative and amortization of PPAs) primarily from projects which were acquired since May 2015 or which commenced commercial operations in September 2015. Pattern Energy also received an increase of $16.6 million in cash distributions from its unconsolidated investments when compared to the same period last year due to a full period of operation at each of its unconsolidated investments in 2016. These increases were partially offset by increases in project expenses of $14.9 million and operating expenses of $10.9 million, primarily from projects which commenced commercial operations or were acquired during 2015, as well as, increased distributions to noncontrolling interests of $7.4 million.

Net loss was $11.1 million in the third quarter of 2016, compared to $35.3 million for the same period last year. Net loss was $55.7 million for YTD 2016 compared to $51.7 million in the same period last year. The improvement in the quarterly period of $24.3 million was primarily attributable to a $38.8 million decrease in other expense related to an increase in earnings from unconsolidated investments, expenses in 2015 for the early extinguishment of debt and termination of designated interest rate derivatives and increased total revenues, partially offset by $7.6 million increase in cost of revenue associated with project related expenses and increased depreciation expense primarily for projects that became commercially operable since September 2015 and a $5.6 million increase in operating expenses.

Adjusted EBITDA was $62.3 million for the third quarter of 2016 compared to $58.7 million for the same period last year. Adjusted EBITDA was $219.0 million for YTD 2016 compared to $172.3 million for the same period last year. The increase for the quarterly period was primarily attributable to projects which commenced commercial operations since September 2015.

2016 Financial Guidance

Pattern Energy is narrowing its targeted annual cash available for distribution for 2016 to a range of $130 million to $140 million, representing an increase of 46% at the midpoint of the range, compared to cash available for distribution in 2015. As noted above, forward-looking cash available for distribution 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.

Quarterly Dividend

Pattern Energy declared an increased dividend for the fourth quarter 2016, payable on January 31, 2017, to holders of record on December 30, 2016 in the amount of $0.408 per Class A common share, which represents $1.632 on an annualized basis. This is a 2.0% increase from the third quarter 2016 dividend of $0.40.

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 will 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 for approximately US $133.0 million. The purchase price was funded from cash available and draws under the Company's revolving credit facility on October 17, 2016.

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. The identified ROFO list stands at 962 MW of total owned capacity. This list of identified ROFO projects represents a portion of Pattern Development's 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, including one project it has agreed to acquire, from Pattern Development and in aggregate grown the identified ROFO list from 746 MW to a total of 2,156 MW. The table below sets forth the current list of identified ROFO projects:

                       

Capacity (MW)

Identified
ROFO Projects

 

Status

 

Location

 

Construction
Start (1)

 

Commercial
Operations (2)

 

Contract
Type

 

Rated (3)

 

Pattern
Development-
Owned (4)

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

 

In construction

 

British Columbia

 

2015

 

2016

 

PPA

 

180

 

180

Belle River

 

Late stage development

 

Ontario

 

2016

 

2017

 

PPA

 

100

 

43

North Kent

 

Late stage development

 

Ontario

 

2017

 

2018

 

PPA

 

100

 

43

Grady

 

Late stage development

 

New Mexico

 

2018

 

2019

 

PPA

 

220

 

176

Henvey Inlet

 

Late stage development

 

Ontario

 

2017

 

2018

 

PPA

 

300

 

150

Mont Sainte-Marguerite

 

Late stage development

 

Québec

 

2016

 

2017

 

PPA

 

147

 

147

Ohorayama

 

Late stage development

 

Japan

 

2017

 

2018

 

PPA

 

33

 

31

Tsugaru

 

Late stage development

 

Japan

 

2017

 

2019

 

PPA

 

126

 

63

                       

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 will be less than its rated capacity. The amount of electricity generated may vary based on a variety of factors.

(4)

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

 

Evaluation of Disclosure Controls and Procedures

As discussed in the Company's Form 10-Q for the period ended September 30, 2016, under Item 4, Controls and Procedures, management believes that the Company's internal control over financial reporting was not effective as of September 30, 2016, due to the aggregation of internal control deficiencies related to the implementation, design, maintenance and operating effectiveness of various transaction, process level, and monitoring controls. These deficiencies largely have arisen during fiscal 2016 because of growth of the Company, increases in employee headcount to support growth, and frequent changes in organizational structure were not adequately supported by elements of its internal control over financial reporting. However, management has concluded that the consolidated financial statements present fairly, in all material respects, the Company's financial position, results of operations and cash flows for the periods disclosed in conformity with U.S. generally accepted accounting principles (GAAP).  Management has developed a plan to remediate the material weaknesses. Management expects the remediation plan to extend over multiple financial reporting periods; therefore, the Company will receive an adverse opinion on its internal control over financial reporting as of December 31, 2016.

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
September 30,

 

Nine months ended
September 30,

 

2016

 

2015

 

2016

 

2015

Net cash provided by operating activities

$

36,408

   

$

34,682

   

$

105,399

   

$

83,282

 

Changes in operating assets and liabilities

(3,526)

   

(4,293)

   

2,772

   

(6,429)

 

Network upgrade reimbursement

   

618

   

   

1,854

 

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

   

   

590

   

1,501

 

Operations and maintenance capital expenditures

(133)

   

27

   

(879)

   

(294)

 

Distributions from unconsolidated investments

8,292

   

9,647

   

40,066

   

23,494

 

Reduction of other asset - Gulf Wind energy derivative deposit

   

5,355

   

   

5,355

 

Other

(195)

   

(1,212)

   

(130)

   

273

 

Less:

             

Distributions to noncontrolling interests

(3,584)

   

(2,871)

   

(11,771)

   

(4,382)

 

Principal payments paid from operating cash flows

(17,060)

   

(19,674)

   

(39,322)

   

(45,057)

 

Cash available for distribution

$

20,202

   

$

22,279

   

$

96,725

   

$

59,597

 

 

 

Three months ended
September 30,

 

Nine months ended
September 30,

 

2016

 

2015

 

2016

 

2015

Net loss

$

(11,050)

   

$

(35,332)

   

$

(55,744)

   

$

(51,734)

 

Plus:

             

Interest expense, net of interest income

19,583

   

18,278

   

60,906

   

54,692

 

Tax (benefit) provision

1,311

   

(2,181)

   

4,038

   

676

 

Depreciation, amortization and accretion

45,755

   

40,241

   

136,974

   

104,082

 

EBITDA

55,599

   

21,006

   

146,174

   

107,716

 

Unrealized (gain) loss on energy derivative (1)

818

   

(4,630)

   

14,970

   

(1,600)

 

(Gain) loss on undesignated derivatives, net

(1,825)

   

6,091

   

17,685

   

5,313

 

Realized loss on derivatives

 

   

11,221

   

   

11,221

 

Early extinguishment of debt

 

   

4,113

   

   

4,113

 

Net loss on transactions

314

   

74

   

353

   

2,663

 

Adjustments from unconsolidated investments (2)

(8,439)

   

   

(19,573)

   

 

Plus, proportionate share from unconsolidated investments:

             

Interest expense, net of interest income

7,634

   

6,466

   

22,778

   

17,085

 

Depreciation, amortization and accretion

6,660

   

6,746

   

19,624

   

16,246

 

Loss on undesignated derivatives, net

1,544

   

7,637

   

17,015

   

9,531

 

Adjusted EBITDA

$

62,305

   

$

58,724

   

$

219,026

   

$

172,288

 
   

(1)

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

(2)

Amount consists of gains on distributions from unconsolidated investments and suspended equity losses of $5.8 million and $2.7 million for the three months ended September 30, 2016, respectively and $15.0 million and $4.6 million for the nine months ended September 30, 2016, respectively.

 

Conference Call and Webcast

Pattern Energy will host a conference call and webcast to discuss these results at 10:30 a.m. Eastern Time on Monday, November 7, 2016. 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 5607011. The replay recording will be available until 11:59 p.m. Eastern Time, November 21, 2016.

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 consummate the agreement to acquire Broadview, the ability to achieve the 2016 cash available for distribution target, the date of commercial operations of the Broadview projects, the ability to achieve targeted owned capacity by the end of 2019, the time period required to remediate the material weakness in internal control over financial reporting, and the type of opinion the Company will receive on its internal control over financial reporting as of December 31, 2016. 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)
(Unaudited)

       
 

September 30,

 

December 31,

 

2016

 

2015

Assets

     

Current assets:

     

Cash and cash equivalents

$

65,733

   

$

94,808

 

Restricted cash

11,562

   

14,609

 

Funds deposited by counterparty

46,643

   

 

Trade receivables

39,395

   

45,292

 

Related party receivable

913

   

734

 

Derivative assets, current

19,197

   

24,338

 

Prepaid expenses

15,529

   

14,498

 

Deferred financing costs, current, net of accumulated amortization of $9,111 and $5,192 as of September 30, 2016 and December 31, 2015, respectively

2,117

   

2,121

 

Other current assets

8,445

   

6,929

 

Total current assets

209,534

   

203,329

 

Restricted cash

13,652

   

36,875

 

Property, plant and equipment, net of accumulated depreciation of $540,774 and $409,161 as of September 30, 2016 and December 31, 2015, respectively

3,182,054

   

3,294,620

 

Unconsolidated investments

87,168

   

116,473

 

Derivative assets

30,259

   

44,014

 

Deferred financing costs

4,598

   

4,572

 

Net deferred tax assets

10,280

   

6,804

 

Finite-lived intangible assets, net of accumulated amortization of $9,441 and $4,357 as of September 30, 2016 and December 31, 2015, respectively

92,550

   

97,722

 

Other assets

23,879

   

25,183

 

Total assets

$

3,653,974

   

$

3,829,592

 
       

Liabilities and equity

     

Current liabilities:

     

Accounts payable and other accrued liabilities

$

32,868

   

$

42,776

 

Accrued construction costs

1,155

   

23,565

 

Counterparty deposit liability

46,643

   

 

Related party payable

1,965

   

1,646

 

Accrued interest

3,071

   

9,035

 

Dividends payable

35,282

   

28,022

 

Derivative liabilities, current

14,945

   

14,343

 

Revolving credit facility

35,000

   

355,000

 

Current portion of long-term debt, net of financing costs of $3,623 and $3,671 as of September 30, 2016 and December 31, 2015, respectively

46,324

   

44,144

 

Other current liabilities

2,668

   

2,156

 

Total current liabilities

219,921

   

520,687

 

Long-term debt, net of financing costs of $18,515 and $22,632 as of September 30, 2016 and December 31, 2015, respectively

1,145,428

   

1,174,380

 

Convertible senior notes, net of financing costs of $4,172 and $5,014 as of September 30, 2016 and December 31, 2015, respectively

201,504

   

197,362

 

Derivative liabilities

64,837

   

28,659

 

Net deferred tax liabilities

23,303

   

22,183

 

Finite-lived intangible liability, net of accumulated amortization of $4,770 and $2,168 as of September 30, 2016 and December 31, 2015, respectively

55,530

   

58,132

 

Other long-term liabilities

59,234

   

52,427

 

Total liabilities

1,769,757

   

2,053,830

 

Commitments and contingencies

     

Equity:

     

Class A common stock, $0.01 par value per share: 500,000,000 shares authorized; 87,469,506 and 74,644,141 shares outstanding as of September 30, 2016 and December 31, 2015, respectively

875

   

747

 

Additional paid-in capital

1,180,512

   

982,814

 

Accumulated loss

(108,065)

   

(77,159)

 

Accumulated other comprehensive loss

(94,149)

   

(73,325)

 

Treasury stock, at cost; 68,344 and 65,301 shares of Class A common stock as of September 30, 2016 and December 31, 2015, respectively

(1,641)

   

(1,577)

 

Total equity before noncontrolling interest

977,532

   

831,500

 

Noncontrolling interest

906,685

   

944,262

 

Total equity

1,884,217

   

1,775,762

 

Total liabilities and equity

$

3,653,974

   

$

3,829,592

 

 

Pattern Energy Group Inc.

Consolidated Statements of Operations

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

(Unaudited)

       
 

Three months ended
September 30,

 

Nine months ended
September 30,

 

2016

 

2015

 

2016

 

2015

Revenue:

             

Electricity sales

$

89,919

   

$

88,256

   

$

266,952

   

$

235,252

 

Related party revenue

1,574

   

955

   

4,121

   

2,630

 

Other revenue

421

   

486

   

1,918

   

1,352

 

Total revenue

91,914

   

89,697

   

272,991

   

239,234

 

Cost of revenue:

             

Project expense

31,384

   

28,848

   

96,989

   

82,075

 

Depreciation and accretion

43,693

   

38,599

   

130,782

   

101,997

 

Total cost of revenue

75,077

   

67,447

   

227,771

   

184,072

 

Gross profit

16,837

   

22,250

   

45,220

   

55,162

 

Operating expenses:

             

General and administrative

11,191

   

7,218

   

31,122

   

22,309

 

Related party general and administrative

3,553

   

1,887

   

7,381

   

5,316

 

Total operating expenses

14,744

   

9,105

   

38,503

   

27,625

 

Operating income

2,093

   

13,145

   

6,717

   

27,537

 

Other income (expense):

             

Interest expense

(19,798)

   

(19,941)

   

(62,134)

   

(56,802)

 

Gain (loss) on undesignated derivatives, net

1,825

   

(6,091)

   

(17,685)

   

(5,313)

 

Realized loss on designated derivatives

   

(11,221)

   

   

(11,221)

 

Earnings (loss) in unconsolidated investments, net

4,685

   

(9,951)

   

15,755

   

768

 

Related party income

1,593

   

605

   

3,697

   

2,029

 

Early extinguishment of debt

   

(4,113)

   

   

(4,113)

 

Net loss on transactions

(314)

   

(74)

   

(353)

   

(2,663)

 

Other income (expense), net

177

   

128

   

2,297

   

(1,280)

 

Total other expense

(11,832)

   

(50,658)

   

(58,423)

   

(78,595)

 

Net loss before income tax

(9,739)

   

(37,513)

   

(51,706)

   

(51,058)

 

Tax (benefit) provision

1,311

   

(2,181)

   

4,038

   

676

 

Net loss

(11,050)

   

(35,332)

   

(55,744)

   

(51,734)

 

Net loss attributable to noncontrolling interest

(7,037)

   

(5,927)

   

(24,838)

   

(16,747)

 

Net loss attributable to Pattern Energy

$

(4,013)

   

$

(29,405)

   

$

(30,906)

   

$

(34,987)

 
               

Weighted average number of shares:

             

Class A common stock - Basic and diluted

81,531,775

   

72,789,583

   

76,821,811

   

69,233,698

 

Loss per share

             

Class A common stock:

             

Basic and diluted loss per share

$

(0.05)

   

$

(0.40)

   

$

(0.40)

   

$

(0.51)

 

Dividends declared per Class A common share

$

0.40

   

$

0.36

   

$

1.17

   

$

1.06

 

 

Pattern Energy Group Inc.
Consolidated Statements of Cash Flows
(In thousands of U.S. dollars)
(Unaudited)

   
 

Nine months ended
September 30,

 

2016

 

2015

Operating activities

     

Net loss

$

(55,744)

   

$

(51,734)

 

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

     

Depreciation and accretion

130,782

   

102,108

 

Amortization of financing costs

5,242

   

5,581

 

Amortization of debt discount/premium, net

3,147

   

798

 

Amortization of power purchase agreements, net

2,278

   

1,175

 

Loss on derivatives, net

29,757

   

793

 

Stock-based compensation

4,362

   

3,234

 

Deferred taxes

3,681

   

340

 

Earnings in unconsolidated investments

(15,755)

   

(813)

 

Distributions from unconsolidated investments
 

377

   

 

Realized loss on derivatives, net

   

10,192

 

Early extinguishment of debt

   

3,958

 

Other reconciling items

44

   

1,221

 

Changes in operating assets and liabilities:

     

  Funds deposited by counterparty

(46,643)

   

 

  Trade receivables

6,078

   

5,657

 

  Prepaid expenses

(1,005)

   

3,994

 

  Other current assets

(3,554)

   

(6,583)

 

  Other assets (non-current)

865

   

(2,022)

 

  Accounts payable and other accrued liabilities

(2,658)

   

4,180

 

  Counterparty deposit liability

46,643

   

 

  Related party receivable/payable

164

   

506

 

  Accrued interest

(6,017)

   

1,970

 

  Other current liabilities

492

   

764

 

  Long-term liabilities

4,835

   

83

 

  Increase in restricted cash

(1,972)

   

(2,120)

 

Net cash provided by operating activities

105,399

   

83,282

 

Investing activities

     

Cash paid for acquisitions, net of cash acquired

(4,024)

   

(406,284)

 

Decrease in restricted cash

23,293

   

41,820

 

Increase in restricted cash

(79)

   

(33,890)

 

Capital expenditures

(31,554)

   

(315,954)

 

Distributions from unconsolidated investments

40,066

   

23,494

 

Other assets

1,619

   

4,650

 

Other investing activities

(136)

   

 

Net cash provided by (used in) investing activities

29,185

   

(686,164)

 

Financing activities

     

Proceeds from public offering, net of issuance costs

$

286,583

   

$

317,822

 

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

   

219,557

 

Repurchase of shares for employee tax withholding

(64)

   

(331)

 

Dividends paid

(85,159)

   

(63,455)

 

Payment for deferred equity issuance costs

   

(1,940)

 

Buyout of noncontrolling interest

   

(121,224)

 

Capital contributions - noncontrolling interest

   

193,064

 

Capital distributions - noncontrolling interest

(11,771)

   

(4,382)

 

Decrease in restricted cash

41,054

   

41,429

 

Increase in restricted cash

(36,027)

   

(41,184)

 

Refund of deposit for letters of credit

   

3,425

 

Payment for deferred financing costs

(134)

   

(8,445)

 

Proceeds from revolving credit facility

20,000

   

295,000

 

Repayment of revolving credit facility

(340,000)

   

(100,000)

 

Proceeds from construction loans

   

294,502

 

Repayment of long-term debt

(39,322)

   

(405,036)

 

Payment for interest rate derivatives

   

(11,061)

 

Other financing activities

(569)

   

 

Net cash provided by (used in) financing activities

(165,409)

   

607,741

 

Effect of exchange rate changes on cash and cash equivalents

1,750

   

(3,319)

 

Net change in cash and cash equivalents

(29,075)

   

1,540

 

Cash and cash equivalents at beginning of period

94,808

   

101,656

 

Cash and cash equivalents at end of period

$

65,733

   

$

103,196

 

Supplemental disclosures

     

Cash payments for income taxes

$

233

   

$

293

 

Cash payments for interest expense, net of capitalized interest

59,172

   

49,239

 

Acquired property, plant and equipment from acquisitions

   

579,712

 

Schedule of non-cash activities

     

Change in property, plant and equipment

6,132

   

20,744

 

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-third-quarter-2016-financial-results-300358146.html

SOURCE: Pattern Energy Group Inc.

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