STOCK SYMBOL: GLH.UN/TSX
GATINEAU, QC, July 27 /CNW Telbec/ - Great Lakes Hydro Income Fund (the "Fund") today reported its financial and operating results for the second quarter ended June 30, 2009. The Fund provides additional information on its strategy and results in its Letter to Unitholders and Supplemental Information available at www.greatlakeshydro.com under Investor Relations/Financial Highlights.
Second quarter revenues of $65.4 million and income before non-cash items of $33.5 million increased by 16% and 7% respectively, from the same period a year earlier. Generation for the second quarter of 2009 was 1,271 gigawatt hours (GWh) as compared with 1,260 GWh during the same period last year and a long-term average of 1,278 GWh.
Generation from hydroelectricity in the quarter was 1,149 GWh, a decrease of 9% as compared to the exceptionally strong second quarter last year but in line with a long-term average of 1,152 GWh. Hydroelectric generation in Quebec and New England remained strong while Ontario and British Columbia were lower than long-term average due to less favorable hydrology.
The Prince Wind farm and 50% joint venture interest in Pingston Hydro, acquired in February 2009, contributed $7.2 million in income before non-cash items, offsetting lower hydroelectric generation than in the prior year which was extremely strong. Prince Wind and Pingston Hydro are performing in line with expectations in the five months since their acquisition.
Second quarter distributions to unitholders were $16.7 million or 31 cents per unit as compared to $15.1 million or 31 cents per unit in the second quarter of 2008. Distributions on the exchangeable shares held by Brookfield Renewable Power were $1.3 million. Total distributions of $18.0 million increased as a result of the additional units and the exchangeable shares issued in connection with the acquisition of the Prince Wind farm and 50% interest in Pingston Hydro in the first quarter of 2009.
FINANCIAL AND OPERATING HIGHLIGHTS ------------------------------------------------------------------------- Unaudited Three months Six months CDN $ millions, except ended June 30 ended June 30 otherwise noted 2009 2008 2009 2008 ------------------------------------------------------------------------- Revenues $ 65.4 $ 56.6 $ 123.4 $ 107.8 Income before non-cash items 33.5 31.4 63.3 58.3 Distribution 16.7 15.1 33.5 30.2 Per unit ($) Income before non-cash items 0.62 0.65 1.18 1.21 Distribution 0.31 0.31 0.63 0.63 Power generated (GWh) 1,271 1,260 2,434 2,421 Average price ($/MWh) 51.47 44.91 50.70 44.53 ------------------------------------------------------------------------- -------------------------------------------------------------------------
"The first half of 2009 has been a highly positive one for the Fund," said Richard Legault, President and CEO of Great Lakes Hydro Income Fund. "The stable, long-term nature of its assets and contractual framework has largely insulated the Fund from the ongoing economic challenges, while the major transaction and strategic repositioning that we recently announced will position the Fund for continued success in the fast-growing renewable power sector. The acquisition of 15 hydroelectric facilities and a soon-to-be-constructed wind power project, together with other initiatives including conversion to a corporation prior to 2011, are expected to provide the Fund with significantly greater scale, an improved financial profile, enhanced access to capital and improved growth prospects. We appreciate the confidence shown by our new and existing investors who participated in the recent private placement and bought-deal subscription receipts offerings, both of which were oversubscribed, and look forward to completing the transaction in the third quarter."
In the second quarter of 2009, the Fund invested $3.8 million in capital expenditures and $0.7 million in major maintenance. In Ontario, work was ongoing on the refurbishment and rewind of the unit at the Aubrey Falls generating station. Spending on this project totaled $2.2 million during the second quarter of 2009 with an additional $0.8 million expected in 2009. The Fund currently expects to invest a total of $17.8 million in capital expenditures and $5.3 million in major maintenance during 2009.
As previously announced, Powell River Energy Inc. has issued $95 million in first mortgage bonds to refinance the $75 million in mortgage bonds which matured on July 24, 2009. The interest rate on the new seven-year bonds was fixed at 6.45%.
At June 30, 2009, the Fund had a strong liquidity position with cash and short-term investments, net of borrowing on its credit facilities, of $25.8 million, an increase of $21.4 million since year-end 2008. The Fund also has access to almost $54 million of committed credit facilities and hydrology reserve facility.
CONFERENCE CALL
A conference call for investors and media to review the second quarter results for 2009 will be held on Tuesday, July 28, 2009 at 10:00 a.m. (EDT). To participate in the conference call, please dial 416-644-3418 or 1-800-732-6179 toll-free in North America, at 9:50 a.m. (EDT). For those unable to participate in the conference call, a taped rebroadcast will also be available until midnight on July 30, 2009. To access this rebroadcast, please call 1-877-289-8525 toll-free in North America, and enter the passcode 21309443(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 ------------------------------------------------------------------------- May 31, 2009 June 30, 2009 10.417 cents April 30, 2009 May 29, 2009 10.417 cents March 31, 2009 April 30, 2009 10.417 cents February 28, 2009 March 31, 2009 10.417 cents January 31, 2009 February 27, 2009 10.417 cents December 31, 2008 January 30, 2009 10.417 cents November 30, 2008 December 31, 2008 10.417 cents October 31, 2008 November 28, 2008 10.417 cents September 30, 2008 October 31, 2008 10.417 cents August 31, 2008 September 30, 2008 10.417 cents July 31, 2008 August 29, 2008 10.417 cents June 30, 2008 July 31, 2008 10.417 cents
CAUTIONARY STATEMENT ON FORWARD-LOOKING INFORMATION
This news release contains forward-looking statements and information within the meaning of the Canadian securities laws. Forward-looking statements may include estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Forward looking statements in this press release include statements regarding the closing of the offering and the proposed acquisition, their impact on the business, operations, financial condition and tax position of the Fund and the intention of the Fund to seek further acquisitions. Forward-looking statements can be identified by the use of words such as "will", "continued", "positions", "expect", "look forward" or variations of such words and phrases. Although the Fund believes that the Fund's anticipated future results, performance or achievements expressed or implied by the forward-looking statements and information are based upon reasonable assumptions and expectations, it can give no assurance that such expectations will prove to have been correct. The reader should not place undue reliance on forward looking statements and information as such statements and information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Fund to differ materially from anticipated future results, performance or achievement expressed or implied by such forward-looking statements and information.
Factors that could cause actual results to differ materially from those contemplated or implied by forward-looking statements include, but are not limited to the risk that the offering and acquisition transaction does not close; other risks associated with the acquisition and achieving the anticipated benefits, risks associated with the Fund's possible conversion to a corporation; changes in hydrology and wind conditions; equipment failure; failure by counterparties to fulfill contractual obligations and failure by the Fund to replace contracts; the Fund's dependence on Brookfield Renewable and potential conflicts of interest between Brookfield Renewable and the Fund; failure by the Fund to discover liabilities associated with, and inability of the Fund to successfully integrate, acquisitions and other risks and factors detailed from time to time in the Fund's public filings including the Annual Information Form dated March 20, 2009 under the heading "Risk Factors" and Management Discussion and Analysis of Financial Results for the fiscal year ended December 31, 2008 under the headings "Business Environment" and "Risk Factors". We caution that the foregoing list of important factors that may affect future results is not exhaustive. Except as required by law, the Fund undertakes no obligation to publicly update or revise any forward looking statements or information, whether written or oral, that may be as a result of new information, future events or otherwise.
ABOUT GREAT LAKES HYDRO INCOME FUND
Great Lakes Hydro (www.greatlakeshydro.com) is a premier Canadian income fund and one of the largest power income funds in North America with 1,260 megawatts of power generating capacity and average annual production of 4,539 gigawatt hours.
Great Lakes Hydro Income Fund produces electricity exclusively from environmentally friendly and renewable resources. The Fund indirectly owns or holds interests in 27 high quality hydroelectric generating stations and one wind farm in four distinct geographic regions across North America: Quebec, Ontario, British Columbia and New England.
Brookfield Renewable Power, which comprises all the power operations of Brookfield Asset Management, owns 50.01% of the Fund's outstanding units on a fully exchanged basis.
Great Lakes Hydro Income Fund units are listed for trading on the Toronto Stock Exchange under the symbol GLH.UN.
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