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2016-11-10

Etrion: Etrion Releases Third Quarter 2016 Results

November 10, 2016, Miami, Florida, United States - Etrion Corporation
("Etrion" or the "Company") (TSX: ETX) (OMX: ETX), a solar
independent power producer, today released its condensed consolidated
interim financial statements and related management's discussion and
analysis ("MD&A") for the three and nine months ended September 30,
2016.

Operational Highlights

· Construction: On October 20, 2016, the Company's 24.7 megawatt
("MW") Shizukuishi solar project in northern Japan achieved full
commercial operation and began collecting revenues from electricity
production. The Company is progressing on the construction of the 9.5
MW Aomori project in northern Japan. The project is on budget and on
schedule with estimated connection to the electricity grid expected
by July 2017.

· Development: Advanced the backlog of two projects in Japan with a
total capacity of 66 MW. Management expects to reach financial close
for these backlog projects within the next 6-9 months. The Company is
advancing the development of additional projects in Japan with a
combined capacity of 190 MW.

· Production: Produced approximately 77.8 million kilowatt-hours
("kWh") of electricity during the three months ended September 30,
2016 (2015: 73.8 million kWh), from the Company's 139 megawatts
("MW") portfolio comprising 23 solar power plants (2015: 139 MW
comprising 23 solar plants) in Italy, Chile and Japan. When separated
by country, the Company produced 36.1 million kWh (2015: 34.6 million
kWh) in Italy, 38.6 million kWh (2015: 36.5 million kWh) in Chile and
3.1 million kWh (2015: 2.6 million kWh) in Japan.

Financial Highlights

· Revenue: Generated revenues of US$17.2 million (2015: US$15.9
million) and US$43.7 million (2015: US$43.4 million) during the three
and nine months ended September 30, 2016, respectively.

· Adjusted EBITDA: Recognized adjusted earnings before interest,
taxes, depreciation and amortization ("EBITDA") of US$12.0 million
(2015: US$10.5 million) and US$28.7 million (2015: US$27.7 million)
during the three and nine months ended September 30, 2016,
respectively.

· Net results: Generated a net loss of US$88.3 million (2015: net
loss of US$4.4 million) during the three months ended September 30,
2016, mainly due to the recognition of an impairment expense of
US$75.7 million and a net deferred tax write-off of US$6.9 million,
both associated with the 70 MW Project Salvador in Chile, partially
offset by positive performance and an increase in production from the
solar power plants in Italy, Chile and Japan. Before the
extraordinary impairment expense, net deferred tax write-off and
other non-cash items, the adjusted net income for the three months
ended September 30, 2016, would have been US$1.5 million.

· Cash and Working Capital: Closed the three months ended September
30, 2016 with a cash balance of US$52.7 million (December 2015:
US$52.5 million), of which US$12.4 million is unrestricted cash at
parent level and positive working capital of US$37.3 million
(December 2015: US$1.5 million).

· Cash distributions: Italian cash distributions more than doubled
during the three and nine months ended September 30, 2016, as a
result of the refinancing and restructuring debt transactions
completed in December 2015 and June 2016.

Management Comments

Marco A. Northland, the Company's Chief Executive Officer, commented,
"Japan continues to be the main focus for Etrion. We recently
connected our second solar park there representing 24.7 MW and began
construction of our third project for 9.5 MW. We are on track to
reach over 100 MW of projects operating and/or under construction in
Japan in the next 12 months with an additional nearly 200 MW in
different stages of development."

Mr. Northland continued, "We are very disappointed by the continued
depressed spot market for electricity in Chile due to decreased
energy demand from mining companies, continued bottlenecks in the
transmission network and an oversupply of energy. Based on current
long-term spot price projections of approximately US$ 38/MWh (in real
terms) we thought it prudent to reduce the carrying value of our
Chilean solar asset. Under applicable accounting principles, the
asset impairment calculation resulted in a write-down of US$75.7
million. However, I would like to remind our investors that our net
equity invested in Project Salvador was US$42.0 million. The related
project loan is non-recourse to Etrion. We will maintain this asset
on our balance sheet for the time being, as it represents an option
in case Chilean electricity prices improve in the future."

Results

During the three months ended September 30, 2016, Etrion reported a
net loss of US$88.3 million (loss per share of US$0.183) compared to
a net loss of US$4.4 million (loss per share of US$0.009) for the
comparable period in 2015. These adverse results in the third quarter
of 2016 were primarily attributable to the impairment expense of
US$75.7 million and the net deferred tax write off of US$6.9 million.
These impairments resulted from a sharp decline in the long term
outlook for power prices in the Chilean market where the 70 MW PV
Salvador SpA project is located.

During the nine months ended September 30, 2016, Etrion reported a net
loss of US$95.4 million (loss per share of US$0.198 compared to a net
loss of US$16.9 million (loss per share of US$0.042) for the
comparable period in 2015. The net results during this period were
adversely impacted by the impairment expenses mentioned above.

Despite negative net results, during the three and nine months ended
September 30, 2016, the Group recognized a gross profit of US$7.9
million and US$16.4 million (2015: US$7.2 million and US$18.1
million), respectively. In addition, during the three and nine months
ended September 30, 2016, the Group reported adjusted operating cash
flows of US$12.6 million and US$29.6 million (2015: US$10.5 million
and US$27.9 million), respectively.

Earnings Call

A conference call/webcast to present the Company's third quarter
results will be held on Thursday, November 10, 2016, at 10:00 a.m.
Eastern Standard Time (EST) / 4:00 p.m. Central European Time (CET).

Dial-in details:

North America: +1-647-788-4919 / Toll Free: +1-877-291-4570 / Sweden
Toll Free: 02-079-4343

Conference ID: 83634335

Webcast:

A webcast will be available at
http://www.investorcalendar.com/IC/CEPage.asp?ID=174544

In addition, the earnings call presentation, along with the Company's
condensed consolidated interim financial statements for the three and
nine months ended September 30, 2016, and related management's
discussion and analysis will be available on the Company's website
(www.etrion.com).

A replay of the telephone conference will be available until December
10, 2016.

Replay dial-in details:

North America: +1-416-621-4642 / Toll Free: +1-800-585-8367

Pass code for replay: 83634335

About Etrion

Etrion Corporation is an independent power producer that develops,
builds, owns and operates utility-scale solar power generation
plants. The Company owns 164 MW of installed solar capacity in Italy,
Chile and Japan. Etrion has 9.5 MW of solar projects under
construction in Japan and is also actively developing solar power
projects in Japan. Etrion is listed on the Toronto Stock Exchange in
Canada and the NASDAQ OMX Stockholm exchange in Sweden under ticker
symbol "ETX". Etrion's largest shareholder is the Lundin family,
which owns approximately 24% of the Company's shares directly and
through various trusts.

For additional information, please visit the Company's website at
www.etrion.com or contact:

Paul Rapisarda - Chief Financial Officer

Telephone (Geneva, Switzerland): +41 (22) 715 20 90

Telephone (Miami, FL, USA): +1 (786) 636-6649

Note: The capacity of power plants in this release is described in
approximate megawatts on a direct current basis, also referred to as
megawatt-peak.

Etrion discloses the information provided herein pursuant to the
Swedish Securities Market Act and/or the Swedish Financial
Instruments Trading Act. The information was submitted for
publication in Sweden at 08:05 Central European Time on November 10,
2016.

Non-IFRS Measures:

This press release includes a non-IFRS measure not defined under IFRS,
specifically EBITDA, Adjusted EBITDA, Adjusted Net income and
Adjusted Operating Cash Flow. Non-IFRS measures have no standardized
meaning prescribed under IFRS and therefore such measures may not be
comparable with those used by other companies.

EBITDA is a useful metric to quantify the Company's ability to
generate cash before extraordinary and non-cash accounting
transactions recognized in the financial statements. In addition,
EBITDA is useful to analyze and compare profitability between
companies and industries because it eliminates the effects of
financing and accounting policy decisions, while Adjusted EBITDA is
also useful because it excludes expenses that are expected to be
non-recurring. Adjusted net income is a useful metric to quantify the
Company's ability to generate cash before extraordinary and non-cash
accounting transactions recognized in the financial statements.
Adjusted Operating Cash Flow is used by investors to compare cash
flows from operating activities without the effects of certain
volatile items that can positively or negatively affect changes in
working capital and are viewed as not directly related to a company's
operating performance. Refer to Etrion's MD&A for the three and nine
months period ended September 30, 2016, for a reconciliation of
EBITDA, Adjusted EBITDA, Adjusted Net Income and Adjusted Operating
Cash Flow reported during the period.

Forward-Looking Information:

This press release contains certain "forward-looking information". All
statements, other than statements of historical fact, that address
activities, events or developments that the Company believes, expects
or anticipates will or may occur in the future (including, without
limitation, statements relating to solar electricity revenue which
with respect to the Company's Italian projects is subject to
confirmation of both the applicable feed-in-tariff ("FiT") to which
the Company is entitled by the state-owned company Gestore Servizi
Energetici and the applicable spot market price by the local
utilities for electricity sales to the national grid, the anticipated
timing of the connection of the Aomori project to the Japanese
electricity grid and the Company's anticipated development pipeline
in Japan) constitute forward-looking information. This
forward-looking information reflects the current expectations or
beli...

Författare WKR

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