STOCK SYMBOL: GLH.UN/TSX
GATINEAU, QC, Feb. 6 /CNW Telbec/ - Great Lakes Hydro Income Fund today reported its financial and operating results for the fourth quarter and year ended December 31, 2006. The Fund provides additional information on its strategy and 2006 results in its Letter to Unitholders and Supplemental Information available at www.greatlakeshydro.com under Investor Relations/Financial Highlights.
In the fourth quarter of 2006, power generation totaled 968 gigawatthours (GWh) compared with 880 GWh a year earlier. Revenues increased to $42.0 million and income before non-cash and special items to $17.3 million. These results reflect the continued strength of the hydrological conditions in Quebec and New England.
Financial and operating results increased significantly for the full-year period. Power generation totaled 4,151 GWh compared with 3,503 GWh last year. Revenue increased by 15% to $177.1 million and income before non-cash and special items by 19% to $82.6 million. These results were driven by exceptionally strong water inflows in Quebec throughout 2006 as well as improved hydrological conditions in our Ontario operations. They also include generation of 59 GWh from the Cedar Dam facility in Quebec that was commissioned in December 2005, and 34 GWh from the Carmichael Falls, Ontario facility that was acquired on July 1, 2006.
In 2006, the Fund's cash distributions increased to $60.1 million from $58.7 million last year.
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Three months ended Year ended
Unaudited December 31 December 31
CDN$ millions, except where noted 2006 2005 2006 2005
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Revenues $ 42.0 $ 39.2 $ 177.1 $ 154.5
Income before non-cash and
special items 17.3 17.0 82.6 69.5
Distribution 15.1 14.7 60.1 58.7
Per unit
Income before non-cash and
special items 0.36 0.35 1.71 1.44
Distribution 0.31 0.30 1.24 1.22
Power generated (GWh) 968 880 4,151 3,503
Average price (¿/KWh) 4.3 4.5 4.3 4.4
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2006 FINANCIAL AND OPERATING HIGHLIGHTS
In 2006, a total of $30.2 million was invested in sustaining capital
expenditures and enhancement initiatives, and $6.0 million in major
maintenance. Major capital projects, many of which extend over multi-year
periods, are now underway at facilities in Quebec, British Columbia, Ontario,
Maine and New Hampshire. It is anticipated that organic growth will add 15 GWh
to the Fund's generation in 2007 and a further 48 GWh by the end of 2009.
At December 31, 2006, the Fund had a cash balance of $31.8 million, almost
$25 million of availability on its credit facilities and almost $21 million
available on its hydrology reserve facilities with Brookfield Power.
"2006 was an excellent year for the Fund. Looking forward to 2007, we
expect to derive the benefit of a full-year's contribution from our Carmichael
Falls acquisition as well as additional efficiency and capacity gains from our
capital improvement program," said Richard Legault, President and Chief
Executive Officer.
YEAR-END CONFERENCE CALL
A conference call for investors and media to review the fourth quarter and
year results for 2006 will be held on Wednesday, February 7, 2007 at
10:00 a.m. (ET). To participate in the conference call, please dial
416-644-3423 or 1-800-732-9307 toll-free in North America, at 9:50 a.m. (ET).
For those unable to participate in the conference call, a taped rebroadcast
will also be available until midnight February 9, 2007. To access this
rebroadcast, please call 1-877-289-8525 toll-free in North America, and enter
the passcode 21215564(number sign). The conference call will also be webcast live on the
Fund's website at www.greatlakeshydro.com, where it will be archived for three
months.
DISTRIBUTIONS
The schedule below sets out the cash distribution history for the last
twelve months:
RECORD DATE PAYMENT DATE DISTRIBUTION PER UNIT
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December 31, 2005 January 31, 2006 10.125 cents
January 31, 2006 February 28, 2006 10.33 cents
February 28, 2006 March 31, 2006 10.33 cents
March 31, 2006 April 28, 2006 10.33 cents
April 28, 2006 May 31, 2006 10.33 cents
May 31, 2006 June 30, 2006 10.33 cents
June 30, 2006 July 31, 2006 10.33 cents
July 31, 2006 August 31, 2006 10.33 cents
August 31, 2006 September 29, 2006 10.417 cents
September 30, 2006 October 31, 2006 10.417 cents
October 31, 2006 November 30, 2006 10.417 cents
November 30, 2006 December 29, 2006 10.417 cents
TAX INFORMATION
Tax information will be forwarded to the Canadian Depository for
Securities Limited and will be posted on the Fund's web site by Friday,
March 2, 2007. Brokerage firms receive the tax information from the Canadian
Depository System, and have the responsibility for preparing the required tax
slips (T5013) for mailing to unitholders by March 31, 2007.
Great Lakes Hydro Income Fund
CONSOLIDATED BALANCE SHEET
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Unaudited
As at December 31
(thousands) 2006 2005
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ASSETS
Current assets
Cash and cash equivalents $ 31,747 $ 57,886
Accounts receivable 7,936 9,931
Due from related parties 3,877 3,597
Prepaid expenses and maintenance materials 4,324 5,367
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47,884 76,781
Power generating assets 1,078,796 1,036,103
Other assets 31,886 17,872
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$ 1,158,566 $ 1,130,756
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LIABILITIES AND UNITHOLDERS' EQUITY
Current liabilities
Accounts and other payables $ 30,160 $ 28,661
Distribution payable to unitholders 5,029 4,888
Credit and hydrology reserve facilities 5,202 4,204
Current portion of long-term debt 3,200 -
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43,591 37,753
Long-term debt 650,050 620,000
Due to holder of non-controlling interest 21,501 21,501
Deferred credits 41,377 38,715
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756,519 717,969
Non-controlling interest (15,624) (16,379)
Unitholders' equity 417,671 429,166
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$ 1,158,566 $ 1,130,756
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CONSOLIDATED STATEMENT OF UNITHOLDERS' EQUITY
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Unaudited
Years ended December 31
(thousands) 2006 2005
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Trust units, end of year $ 573,308 $ 573,308
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Deficit, beginning of year (108,374) (77,788)
Net income 47,869 28,070
Distributions to unitholders (60,064) (58,656)
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Deficit, end of year (120,569) (108,374)
Currency translation adjustment, end of year (35,068) (35,768)
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Unitholders' equity, end of year $ 417,671 $ 429,166
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Great Lakes Hydro Income Fund
CONSOLIDATED STATEMENT OF INCOME
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Unaudited
Years ended December 31
(thousands, except per trust unit amounts) 2006 2005
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Revenues $ 177,113 $ 154,456
Expenses
Operating and maintenance 50,120 44,087
Selling and administrative expenses 2,681 2,336
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124,312 108,033
Interest and financing fees 38,594 35,019
Yield maintenance fee - 10,197
Interest on due to holder of non-controlling
interest 3,120 3,510
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Income before non-cash items 82,598 59,307
Gain on disposal of power generating assets - (1,880)
Depreciation and amortization 30,556 27,699
Non-controlling interest 1,439 600
Future taxes 2,734 4,818
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Net income $ 47,869 $ 28,070
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Net income per trust unit $ 0.99 $ 0.58
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Weighted average number of units
outstanding (000s) 48,276 48,276
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Great Lakes Hydro Income Fund
CONSOLIDATED STATEMENT OF CASH FLOWS
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Unaudited
Years ended December 31
(thousands) 2006 2005
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Operating activities
Net income $ 47,869 $ 28,070
Add (deduct) non-cash items:
Gain on disposal of power generating assets - (1,880)
Depreciation and amortization 30,556 27,699
Non-controlling interest 1,439 600
Future taxes 2,734 4,818
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Income before non-cash items 82,598 59,307
Change in non-cash working capital 4,099 905
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86,697 60,212
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Investing activities
Purchase of a power system (53,089) -
Additions to power generating assets (31,299) (34,845)
Proceeds on disposal of power generating assets - 1,885
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(84,388) (32,960)
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Financing activities
Financing fees (632) (6,794)
Credit facility - drawdown 998 8,000
Credit and hydrology reserve facilities - repayment - (40,600)
Bridge facility - drawdown - 125,000
Bridge facility - repayment - (125,000)
Long-term debt - issuance 32,000 225,000
Long-term debt - repayment - (113,738)
Distributions to non-controlling interest (684) (662)
Distributions to unitholders (59,923) (58,596)
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(28,241) 12,610
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Effect of foreign exchange rate changes on
cash and cash equivalents (207) (252)
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Increase (decrease) in cash and cash equivalents (26,139) 39,610
Cash and cash equivalents, beginning of year 57,886 18,276
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Cash and cash equivalents, end of year $ 31,747 $ 57,886
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Cash and cash equivalents is comprised of:
Cash $ 9,574 $ 13,605
Short-term investments 22,173 44,281
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$ 31,747 $ 57,886
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Supplementary information:
Interest paid during the year $ 40,283 $ 45,962
Income taxes paid during the year 256 555
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FORWARD-LOOKING STATEMENTS
This news release may contain forward-looking statements concerning the Great Lakes Hydro Income Fund ("Fund") business and operations. Forward looking statements can be identified by the use of words, such as "believe", "well positioned", "long-term", "grow", "expand", "enhance" or variations of such words and phrases or state that certain actions, events or results "will" be taken, occur or be achieved. Forward looking statements involve assumptions, known and unknown risks, uncertainties and other factors which may cause the actual results or performance to be materially different from any future results or performance expressed or implied by the forward statements. More details relating to risk factors can be found in the Fund's annual information form in the section entitled Risk Factors.
Examples of such statements include, but are not limited to factors relating to production and the business, financial position, operations and prospects for the Fund. They include (1) the Fund's level of generation; (2) the Fund's cost of production; (3) interest rates as they bear on the Fund's indebtedness; (4) planned capital expenditures; (5) the impact of changes in the Canadian dollar - U.S. dollar on the Fund's costs and results of operations; (6) the negotiation of collective agreements with its unionized employees; (7) business and economic conditions; (8) the legislation governing air emissions, discharges into water, waste, hazardous materials and workers' health and safety as well as the impact of future legislation and regulations on expenses, capital expenditures and restrictions on operations; (9) regulatory investigations, claims, lawsuits and other proceedings; and (10) reliance on the guaranteed price for electricity by Brookfield Power Inc. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied in the forward-looking statements contained herein, and as a such, you are cautioned not to place undue reliance on these forward-looking statements.
These forward-looking statements represent our views as of the date of this news release. While the Fund anticipates that subsequent events and developments may cause the Fund's views to change, the Fund disclaims any obligation to update these forward-looking statements. These forward-looking statements should not be relied upon as representing the Fund's views as of any date subsequent to the date of this news release.
ABOUT GREAT LAKES HYDRO INCOME FUND
Great Lakes Hydro (www.greatlakeshydro.com) is a premier Canadian income fund. We are the largest power income fund in North America with 1,015 megawatts of power generating capacity and an average annual production of 3,874 gigawatt hours.
Great Lakes Hydro Income Fund produces electricity exclusively from environmentally friendly hydroelectric resources. The Fund owns, operates and manages 26 high quality hydroelectric generating stations located on eight river systems in four distinct geographic regions across North America: Quebec, Ontario, British Columbia and New England.
Brookfield Power, which comprises all the power operations of Brookfield Asset Management, owns 50.1% of the Fund's outstanding units.
Great Lakes Hydro Income Fund units are listed for trading on the Toronto Stock Exchange under the symbol GLH.UN.
%SEDAR: 00013106EF