Maxim Power Corp. Announces 2020 Fourth Quarter Financial and Operating Results
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CALGARY, Alberta, March 18, 2021 (GLOBE NEWSWIRE) -- Maxim Power Corp. ("MAXIM" or the "Corporation") (TSX: MXG) announced today the release of financial and operating results for the fourth quarter ended December 31, 2020. The audited consolidated financial statements, accompanying notes and Management’s Discussion and Analysis (“MD&A”) will be available on SEDAR and on MAXIM's website on March 18, 2021. All figures reported herein are Canadian dollars unless otherwise stated.
|Three Months Ended December 31,||Twelve Months Ended December 31,|
|($ in thousands except per share amounts)||2020||2019||2020||2019|
|Adjusted EBITDA (1)||3,998||(2,185||)||10,302||(1,403||)|
|Net income (loss)||8,923||(2,173||)||9,260||(5,850||)|
|Net income (loss) per share – diluted||$||0.18||$||(0.04||)||$||0.18||$||(0.11||)|
|Total generation – Milner (MWh)||-||74,181||42,301||442,916|
|Total generation – M2 (MWh) (2)||338,201||-||795,459||-|
|Average Alberta market power price ($ per MWh)||46.13||47.16||46.72||55.31|
|Average Milner realized power price ($ per MWh)||-||66.92||171.45||63.90|
|Average M2 realized power price ($ per MWh) (2)||51.10||-||49.62||-|
|Total gross debt||68,688||52.833||68,688||52,833|
(1) Select financial information was derived from the consolidated financial statements and is prepared in accordance with GAAP, except adjusted EBITDA. Adjusted EBITDA is provided to assist management and investors in determining the Corporation's approximate operating cash flows before interest, income taxes, and depreciation and amortization and certain other income and expenses. (2) Generation and realized power prices for M2 relate to June to December 2020 only as the asset was commissioned on June 1.
During the fourth quarter and twelve months of 2020, adjusted Earnings before Interest, Income Taxes, Deprecation and Amortization (“EBITDA”) increased as compared to 2019. A significant portion of the increase is the result of the operation of MAXIM's state-of-the-art 204 MW simple-cycle gas turbine facility Milner 2 (“M2”), which was commissioned in the second quarter of 2020. As expected, the capacity and high reliability of M2 increased revenues and reduced operations and maintenance costs. Additionally, the Government of Alberta Technology Innovation and Emissions Reduction program benefits accrue to earnings through the impacts of reduced carbon tax associated with M2. These favourable variances were partially offset by lower realized power prices and higher fuel costs in 2020 as compared to 2019.
Net income increased in the fourth quarter and twelve months of 2020, primarily due to the same factors impacting adjusted EBITDA, receipt of the first of three schedule Line Loss Proceeding payments and the recognition of a deferred tax asset. These favourable variances were partially offset by depreciation of M2, financing costs incurred in relation to the M2 project and unrealized losses on commodity swaps.
AUC LOSS FACTOR DECISION
The Corporation has received the first two of three Line Loss Proceeding payments in the sum of $34.3 million from the Alberta Electric System Operator (“AESO”) relating to the years 2010 to 2016, of which $6.4 million was received in December 2020. The Corporation has also received a preliminary statement from the AESO for the third payment relating to the years 2006 to 2009 in the amount of $18.6 million which is expected to be paid on May 31, 2021. Assuming all payments are made and received as currently expected the total recovery of overpayments made will total $52.9 million, inclusive of interest.
Based in Calgary, Alberta, MAXIM is one of Canada’s largest truly independent power producers. MAXIM is now focussed entirely on power projects in Alberta. Its core asset – the 204 MW H.R. Milner Plant, M2, in Grande Cache, AB – is a state-of-the-art natural gas-fired power plant that commissioned in Q2, 2020. MAXIM has the option to increase the capacity of M2 to approximately 300 MW and concurrently realize an improvement in the efficiency of the plant by investing in heat recovery combined cycle technology. In addition, MAXIM continues to explore additional development options in Alberta including its currently permitted gas-fired generation project and the permitting of its wind power generation project. MAXIM trades on the TSX under the symbol “MXG”. For more information about MAXIM, visit our website at www.maximpowercorp.com. For further information please contact:
Bob Emmott, President and COO, (403) 263-3021.
This press release contains forward-looking statements and forward-looking information (collectively "forward looking information") within the meaning of applicable securities laws relating to MAXIM's plans and other aspects of MAXIM's anticipated future operations, management focus, objectives, strategies, financial, operating and production results. Forward-looking information typically uses words such as "anticipate", "believe", "project", "expect", "goal", "plan", "intend", "may", "would", "could" or "will" or similar words suggesting future outcomes, events or performance. The forward-looking statements contained in this press release speak only as of the date thereof and are expressly qualified by this cautionary statement. Specifically, this press release contains forward-looking statements relating to: the Corporation's current estimate of the proceeds payable to the Corporation from the outstanding compliant relating to the AESO Line Loss Proceeding and the timeline to potentially receive any proceeds therefrom.
Management has included the forward-looking statements above and a summary of assumptions and risks related to forward-looking statements provided in this press release in order to provide readers with a more complete perspective on MAXIM's future plans and operations and such information may not be appropriate for other purposes.
MAXIM's actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that MAXIM will derive there from. Readers are cautioned that the foregoing lists of factors are not exhaustive. These forward looking statements are made as of the date of this press release and MAXIM disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities laws.
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