Atlantic Power (AT) Reports Q3 Loss of $0.69, Narrows Outlook
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Atlantic Power (NYSE: AT) reported Q3 EPS of ($0.69), versus ($0.05) reported last year. Revenue for the quarter came in at $101.2 million, versus $107.5 million reported last year.
The Company has not provided guidance for Project income or Net income because of the difficulty of making accurate forecasts and projections without unreasonable efforts with respect to certain highly variable components of these comparable GAAP metrics, including changes in the fair value of derivative instruments and foreign exchange gains or losses. These factors, which generally do not affect cash flow, are not included in Project Adjusted EBITDA.
Based on the results of the nine months ended September 30, 2016 and the outlook for the fourth quarter of 2016, the Company is narrowing its range for 2016 Project Adjusted EBITDA guidance to between $205 and $215 million, from the previous range of $200 to $220 million.
Table 6 provides a bridge of the Company's 2016 Project Adjusted EBITDA guidance to Cash provided by operating activities. For purposes of providing this bridge to a cash flow measure, the impact of changes in working capital is assumed to be nil.
"During the third quarter we continued to make significant progress in strengthening our balance sheet and improving our debt maturity profile, repaying nearly $24 million of term loan and project debt and repurchasing approximately $63 million of our June 2019 convertible debentures. Continued debt repayment should improve our leverage ratio of 5.8 times by more than a turn by the end of next year," said James J. Moore, Jr., President and CEO of Atlantic Power. "In addition, during the quarter we repurchased nearly 3.7 million common shares, for a total of 7.1 million repurchased under the normal course issuer bid implemented last December. The average repurchase price of $2.44 per share represents a significant discount to our estimate of intrinsic value. We currently have approximately $60 million of discretionary cash available for further debt and equity repurchases and internal or external growth investments, which we will continue to allocate to the highest-return uses."
"We continue to focus on cost and debt reduction as an important contributor to improved cash flow. Over the next four years we expect to amortize more than $400 million of our term loan and project debt, which will drive interest expense and leverage lower," continued Mr. Moore. "In addition, we now expect our overhead costs for 2016 to be approximately $24 million, more than 10% lower than our previous estimate, which was already 50% below the level of 2013. We plan to aggressively seek further cost reduction opportunities, with a major focus on operating costs in 2017."
For earnings history and earnings-related data on Atlantic Power (AT) click here.
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