Atlantic Power (AT) Misses Q3 EPS by 32c, Miss on Revenues; Boosts FY17 EBITDA Guidance

Atlantic Power (NYSE: AT) reported Q3 EPS of ($0.29), $0.32 worse than the analyst estimate of $0.03. Revenue for the quarter came in at $108.6 million versus the consensus estimate of $124.1 million.

Third Quarter and YTD 2017 Highlights

• Cash provided by operating activities of $52.9 million in Q3 2017 vs. $38.2 million in Q3 2016
  • $137.9 million for the first nine months of 2017 vs. $91.9 million in the year-ago period
• Net loss of $(32.9) million in Q3 2017 vs. $(82.4) million in Q3 2016
  • $(57.5) million for the first nine months of 2017 vs. $(116.2) million in the year-ago period
• Project Adjusted EBITDA of $77.4 million in Q3 2017 vs. $51.3 million in Q3 2016
  • $226.6 million for the first nine months of 2017 vs. $159.9 million in the year-ago period
• Repaid $29.4 million of term loan and project debt during Q3 2017 and $86.2 million year to date
• Liquidity at September 30, 2017 of $249.8 million

Recent Developments

• In October, repaid $54.6 million remaining project debt at Piedmont, yielding estimated interest cost savings of $4.5 million annually
  • Pro forma for Piedmont debt repayment, liquidity was $178.5 million and leverage ratio was 3.6 times
• In October, executed second repricing of term loan and revolver, reducing spread 75 bp to L+3.50%
  • Estimated interest cost savings of $4 million in 2018 and $15 million over terms of facilities
• In October, executed a one-year extension of the maturity date of the revolver to April 2022
• In October, Moody\'s upgraded the Company\'s corporate family credit rating to Ba3 from B1

Guidance

• Increased 2017 Project Adjusted EBITDA guidance range by $10 million (see page 7)

Increasing 2017 Guidance

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.

The Company has increased its previous 2017 guidance for Project Adjusted EBITDA of $250 to $265 million by $10 million to a range of $260 to $275 million. The primary reasons for the increase are higher water flows at Curtis Palmer and lower costs at the non-operational plants in Ontario in the year to date, and the expectation that certain repowering expenditures previously planned for the fourth quarter of 2017 will not occur or will be deferred into 2018.

For earnings history and earnings-related data on Atlantic Power (AT) click here.

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