ACQUISITION OF TWO WIND FARMS IN FRANCE FOR 43 MW
- Revenues increased 56% to $108.2
million compared with the same period last year.
- Adjusted EBITDA rose 60% to $81.8
million compared with the same period last year.
- Innergex and Desjardins Group Pension Plan completed the
acquisition of the Plan Fleury and Les Renardières wind facilities
in France with a total aggregate
installed capacity of 43 MW.
- Innergex announced that it had entered into an arrangement
agreement to acquire Alterra Power Corp. for an aggregate
consideration of $1.1 billion,
significantly increasing its US presence and accelerating its
growth profile.
(All amounts are in Canadian dollars, except as
noted.)
LONGUEUIL, QC, Nov. 9,
2017 /CNW Telbec/ - Innergex Renewable Energy Inc.
(TSX: INE) ("Innergex" or the "Corporation") today released
its operating and financial results for the third quarter ended
September 30, 2017.
"In the past quarter, we are proud to have completed our fourth
acquisition of wind farms in France. The addition of our recently
commissioned and acquired facilities contributed to our growth in
revenues and Adjusted EBITDA," said Michel Letellier,
President and Chief Executive Officer of the Corporation.
"We are pleased with our latest announcement regarding our
intention to acquire all of the issued and outstanding common
shares of Alterra Power Corp. This highly strategic acquisition
will bring our overall net power generation capacity to 1,606 MW,
up over 40% pro forma, in addition to accelerating Innergex's
growth profile in the United
States," he added.
OPERATING
RESULTS
|
|
Amounts shown are
in thousands of Canadian
dollars except as noted otherwise.
|
Three months ended
September 30
|
Nine months ended
September 30
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Power generated
(MWh)
|
1,243,099
|
|
831,840
|
|
3,288,151
|
|
2,672,678
|
|
Long-term average
(MWh)
|
1,374,068
|
|
924,439
|
|
3,631,564
|
|
2,526,725
|
|
Revenues
|
108,234
|
|
69,255
|
|
292,290
|
|
219,520
|
|
Adjusted
EBITDA1
|
81,803
|
|
51,176
|
|
218,664
|
|
165,720
|
|
Net
earnings
|
4,384
|
|
409
|
|
16,150
|
|
23,282
|
|
Net earnings, $ per
share - basic and diluted
|
0.04
|
|
0.02
|
|
0.17
|
|
0.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trailing 12 months
ended
September 30
|
|
|
|
|
|
2017
|
2016
|
Free Cash
Flow1
|
|
|
|
|
88,889
|
|
75,847
|
|
Payout
Ratio1
|
|
|
|
|
80
|
%
|
89
|
%
|
1 Please
refer to the Non-IFRS Measures Disclaimer for the definition of
Adjusted EBITDA, Free Cash Flow and Payout Ratio.
|
Electricity Production
During the three-month period ended September 30, 2017, the
Corporation's facilities produced 1,243 GWh of electricity or
90% of the LTA of 1,374 GWh. Overall, the hydroelectric
facilities produced 93% of their LTA due mainly to lower production
from post-commissioning activities at the Upper Lillooet River
facility during the quarter, partly offset by above-average water
flows in Quebec and Ontario. The wind farms produced 83% of their
LTA attributable to lower production at the Mesgi'g Ugju's'n
facility due to post-commissioning activities, low wind regimes and
outages from Hydro-Quebec (outages
for which we should be compensated) and to wind regimes being below
the historical average in France.
The solar farm produced 115% of its LTA due to an above-average
solar regime. The 49 % production increase over the same period
last year is due mainly to the contribution of the recently
commissioned or acquired facilities and to higher production at our
Quebec and Ontario hydro facilities.
During the nine-month period ended September 30, 2017, the
Corporation's facilities produced 3,288 GWh of electricity or
91% of the LTA of 3,632 GWh. Overall, the hydroelectric
facilities produced 94% of their LTA due mainly to lower production
from post-commissioning activities at the Upper Lillooet River
facility during the period and below-average water flows in
British Columbia, partly offset by
above-average water flows in Quebec and Ontario. The wind farms produced 83% of their
LTA due to lower production from post-commissioning activities at
the Mesgi'g Ugju's'n facility and below-average wind regimes in
Quebec and France. Wind regimes in France have lately trended well below the
historical average, which explains the lower production. The solar
farm produced 108% of its LTA due to an above-average solar regime.
The 23% production increase over the same period last year is due
mainly to the contribution of the recently commissioned or acquired
facilities and to higher production at our Quebec and Ontario hydro facilities, which was partly
offset by lower production at most of our British Columbia hydro facilities and to lower
production at our Quebec wind
farms.
Revenues
For the three-month period ended September 30, 2017, the
Corporation recorded revenues of $108.2
million, compared with $69.3 million for three-month period ended
September 30, 2016. This 56% increase
is attributable mainly to the contribution of the Mesgi'g Ugju's'n
wind farm commissioned in 2016 and of the Upper Lillooet River and
Boulder Creek hydro facilities commissioned in 2017 as well as to
the acquisition of the Montjean, Theil
Rabier, Yonne, Rougemont
1-2, Vaite and Plan Fleury wind facilities in 2016 and 2017 in
France, which was partly offset by
lower production at our Quebec
wind farms.
For the nine-month period ended September 30, 2017, the
Corporation recorded revenues of $292.3
million, compared with $219.5 million for nine-month period ended
June 30, 2016. This 33% increase is
attributable mainly to the facilities commissioned in 2016 and 2017
and wind facilities acquired in 2016 and 2017 in France, which was partly offset by lower
production at most of our British
Columbia hydro facilities and at our Quebec wind farms.
Adjusted EBITDA
For the three- and nine-month periods ended September 30,
2017, the Corporation recorded Adjusted EBITDA of $81.8 million and $218.7 million, respectively compared with
$51.2 million and $165.7 million for the same periods last
year. These increases of 60% for three-month period and 32% for the
nine-month period are due mainly to production and revenues from
new facilities, partly offset by higher operating expenses, general
and administrative expenses and prospective project expenses. The
Adjusted EBITDA Margin increased from 73.9% to 75.6% for the
quarter mainly due to the increase in revenues net of operating
expenses. The Adjusted EBITDA Margin decreased from 75.5% to 74.8%
for the nine-month period due mainly to the payment related to
water rights for 2011 and 2012 in British
Columbia made in the first quarter of 2017.
Net Earnings
For the three-month period ended September 30, 2017, the
Corporation recorded net earnings of $4.4
million (basic and diluted net earnings of $0.04 per share), compared with net earnings of
$0.4 million (basic and diluted net
earnings of $0.02 per share) in 2016.
The $4.0 million increase in net
earnings is attributable mainly to the increase in revenues mainly
due to the recently commissioned and acquired facilities. As a
result, the $30.6 million
increase in Adjusted EBITDA was partly offset by the $13.1 million increase in finance costs and
the $10.3 million increase in
depreciation and amortization and the $3.4 million increase in income taxes
expenses.
For the nine-month period ended September 30, 2017, the
Corporation recorded net earnings of $16.2 million (basic and diluted net
earnings of $0.17 per share),
compared with net earnings of $23.3 million (basic and diluted net
earnings of $0.20 per share) in 2016.
The $7.1 million decrease in net
earnings is attributable mainly to this year's below-average
production compared with last year's above-average production,
which explains the decrease in net earnings as opposed to the
increase in revenues. As a result, the $37.3
million increase in finance costs and the $30.3 million increase in depreciation and
amortization were only partly offset by the $52.9 million increase in Adjusted EBITDA, the
$3.3 million decrease in income
taxes expenses and the $3.3 million increase in share of earnings
of joint ventures.
Free Cash Flow and Payout Ratio
For the trailing twelve-month period ended September 30,
2017, the Corporation generated Free Cash Flow of $88.9 million, compared with $75.8 million for the same period last year.
Despite lower cash flows from operating activities, the increase in
Free Cash Flow is due mainly to higher changes in non-cash
operating working capital items, partly offset by greater scheduled
debt principal payments and higher free cash flows attributed to
non-controlling interests.
For the trailing twelve-month period ended September 30,
2017, the dividends on common shares declared by the Corporation
amounted to 80% of Free Cash Flow, compared with 89% for the
corresponding period last year. This positive change results mainly
from the recent commissioning of the Mesgi'g Ugju's'n, Upper
Lillooet River and Boulder Creek facilities which generated higher
Free Cash Flow, partly offset by the increase in annual dividend,
higher dividend payments as a result of a higher number of common
shares outstanding due to the issuance of 3,906,250 shares to three
Desjardins Group-affiliated entities under a private placement of
Innergex common shares in April 2016
and to additional shares following the exercise of stock options
and issued under the Dividend Reinvestment Plan ("DRIP").
BUSINESS ACQUISITION
Acquisition of Plan Fleury and Les Renardières
On August 25, 2017, Innergex
completed the acquisition of two wind projects in France's Champagne-Ardenne region with an
aggregate capacity of 43 MW. Innergex owns a 69.55% interest in the
wind farms while Desjardins Group Pension Plan owns the remaining
30.45%.
The equity's purchase price is €27.4 million ($40.8 million), subject to certain adjustments.
Innergex's net share of the purchase price amounted to about €16.5
million ($24.2 million) and was paid
through funds available under its corporate revolving credit
facility. The remainder of the purchase price was paid by
Desjardins Group Pension Plan in the amount of €10.7 million
($15.7 million).
Non-recourse debts related to the projects, which were already
in place, will amount to €72.0 million ($105.7 million) at the end of construction and
will remain at each project level.
The aggregate annual power generation is expected to reach
118,000 MWh once the two projects are in commercial operation,
enough to power about 24,775 French households. All the electricity
produced by these wind farms will be sold under fixed-price power
purchase agreements (PPAs), with a portion of the price being
adjusted according to inflation indexes, for an initial term of 15
years, with Electricité de France
("EDF"). Innergex is expecting revenues of approximately €9.9
million ($14.5 million) and
Adjusted EBITDA of approximately €8.2 million ($12.0 million) for the first 12 months of
operation.
The Plan Fleury (22.0 MW) wind farm began commercial operation
during the third quarter. The wind project Les Renardières (21.0
MW) should be fully commissioned in the fourth quarter of 2017
DEVELOPMENT PROJECTS
Commissioning Activities
Plan Fleury
In the third quarter, the Corporation began commercial operation
of the 22.0 MW Plan Fleury wind facility located in
Champagne-Ardenne, France.
Construction began prior to its acquisition by Innergex and was
completed in August 2017. The Declaration of Commercial
Operation Date (COD) under the purchase agreement with EDF shows an
effective commissioning date of September 6,
2017. The Plan Fleury facility's average annual production
is estimated to reach 65,266 MWh, enough to power more than
13,750 French households.
In its first full year of operation, it is expected to generate
revenues and Adjusted EBITDA of approximately €5.5 million
($8.0 million) and €4.6 million
($6.7 million) respectively. All the
electricity the facility produces is covered by an initial 15-year
fixed-price PPA with EDF, with a portion of the price being
adjusted according to inflation indexes.
Construction activities
Rougemont-2
The Rougemont-2 wind project
was acquired during the second quarter of 2017. Construction was
already underway at the time of the acquisition.
As at the date of this press release, all substantial civil
works are complete. Eight out of 16 wind turbines have already
reached commercial operation. Delivery of the wind turbines'
components is complete and installation and commissioning is under
way on the remaining eight turbines (six out of these eight wind
turbines are already erected and five are already commissioned).
Full commissioning is expected in the fourth quarter of 2017.
Les Renardières
The Les Renardières wind project was acquired during the third
quarter of 2017. Construction was already under way at the time of
the acquisition.
As at the date of this MD&A, all wind turbines had been
commissioned and the test runs were in progress. Full commissioning
is expected in the fourth quarter of 2017.
SUBSEQUENT EVENTS
Increase and Extension of the Credit Facility
On October 31, 2017, the
Corporation announced that it had increased its revolving credit
facility by $50 million and added a
new lender to the syndicate of lenders. It also extended the
maturity of its revolving facility from December 2021 to December
2022 to provide greater flexibility. The revolving credit
facility now stands at $475 million.
Arrangement Agreement to Acquire Alterra Power Corp.
On October 30, 2017, the
Corporation and Alterra Power Corp. ("Alterra") announced that they
have entered into an arrangement agreement (the "Arrangement
Agreement") pursuant to which Innergex will acquire at a price of
$8.25 per share all of the issued and
outstanding common shares of Alterra ("Alterra Common Shares") for
an aggregate consideration of $1.1
billion, including the assumption of Alterra's debt
(the "Transaction"). The Transaction is subject to approval by
Alterra's shareholders and other customary closing conditions. The
Transaction is not subject to approval by Innergex
shareholders.
Pursuant to the Transaction, Alterra shareholders will receive
an aggregate consideration which will consist of approximately 25%
in cash and 75% in common shares of Innergex ("Innergex Common
Shares"). The Innergex Common Shares issuable to Alterra
shareholders in connection with the Transaction represent a pro
forma ownership pf approximately 19% of the combined company.
Innergex has entered into a support and voting agreement with
Mr. Ross Beaty, Executive Chairman
of Alterra, and certain related entities who have control over
approximately 31% of Alterra's issued and outstanding common
shares. Pursuant to the support and voting agreement, Mr. Beaty,
together with these related entities, have agreed to: (i) vote all
of their Alterra Common Shares in favour of the Transaction at the
Special Meeting (ii) a 12-month holding period with respect to the
Innergex Common Shares to be received by them as a result of the
Transaction; and (iii) elect to receive Innergex Common Shares for
the entirety of the Alterra Common Shares held by them.
Alterra will complement Innergex's current operating, under
construction and prospective projects, resulting in increased
geographic and technological diversification through meaningful
presence in the United States and
Icelandic power markets as well as the addition of geothermal power
generation to Innergex's production mix. The Corporation believes
that the transaction significantly accelerates Innergex's growth
profile.
The transaction is expected to be accretive to Innergex's
distributable cash flow per share upon completion of Alterra's
projects currently under construction and some of the
advanced-stage prospective projects.
Innergex has structured the financing of the cash portion of the
Transaction in order to maintain a strong and flexible balance
sheet that provides for ample liquidity to fully fund Innergex's
development portfolio pro forma the Transaction. To that end,
the Caisse de dépôt et placement du Québec will provide the
Corporation with a 5-year $150
million subordinated unsecured term loan at a competitive
interest rate to be fixed at closing. The Corporation also obtained
commitments from two leading Canadian banks to backstop its
existing credit facilities, to implement the Transaction and to
upsize its revolving credit facility to an aggregate amount of up
to $700 million.
DIVIDEND DECLARATION
The following dividends will be paid by the Corporation on
January 15, 2018:
|
|
|
|
|
|
Date of
announcement
|
Record
date
|
Payment
date
|
Dividend per
common share
|
Dividend per
Series A Preferred
Share
|
Dividend per
Series C
Preferred Share
|
November 9,
2017
|
December 29,
2017
|
January 15,
2018
|
$0.1650
|
$0.2255
|
$0.359375
|
On February 23, 2017, the Board of
Directors increased the quarterly dividend from $0.160 to $0.165
per common share, corresponding to an annual dividend of
$0.66 per common share.
CONFERENCE CALL REMINDER
The Corporation will hold a conference call tomorrow,
Friday, November 10, 2017, at
9 AM (EST). Its 2017 third
quarter and nine-month review and outlook will be presented by
Michel Letellier, President and
Chief Executive Officer of Innergex, and Jean Perron, Chief
Financial Officer. Investors and financial analysts are invited to
access the conference call by dialing
1 888 231-8191 or 647 427-7450. Media
and the public may also access this conference call in listen-only
mode. A replay of the conference call will be available later the
same day on the Corporation's website.
About Innergex Renewable Energy Inc.
The Corporation develops, owns and operates run-of-river
hydroelectric facilities, wind farms and solar photovoltaic farms
and carries out its operations in Quebec, Ontario and British
Columbia, Canada, France
and Idaho, USA. Its portfolio of
assets currently consists of: (i) interests in 52 operating
facilities with an aggregate net installed capacity of 1,079 MW
(gross 1,781 MW), including 31 hydroelectric facilities, 20
wind farms and one solar farm; (ii) interests in two projects under
construction with a net installed capacity of 46 MW (gross 66 MW),
for which a power purchase agreement has been secured; and (iii)
prospective projects with an aggregate net capacity totalling 3,560
MW (gross 3,940 MW). Innergex Renewable Energy Inc. is rated BBB-
by S&P.
The Corporation's strategy for building shareholder value is to
develop or acquire high-quality facilities that generate
sustainable cash flows and provide an attractive risk-adjusted
return on invested capital and to distribute a stable dividend.
Non-IFRS measures disclaimer
The consolidated financial statements for the three- and
nine-month periods ended September 30, 2017, have been
prepared in accordance with International Financial Reporting
Standards ("IFRS"). However, some measures referred to in this
press release are not recognized measures under IFRS and therefore
may not be comparable to those presented by other issuers. Innergex
believes that these indicators are important, as they provide
management and the reader with additional information about the
Corporation's production and cash generation capabilities, its
ability to sustain current dividends and dividend increases and its
ability to fund its growth. These indicators also facilitate the
comparison of results over different periods. Adjusted EBITDA,
Adjusted EBITDA Margin, Free Cash Flow and Payout Ratio are not
measures recognized by IFRS and have no standardized meaning
prescribed by IFRS.
References in this document to "Adjusted EBITDA" are to revenues
less operating expenses, general and administrative expenses and
prospective project expenses.
References in this document to "Adjusted EBITDA Margin" are to
Adjusted EBITDA divided by revenues.
References to "Free Cash Flow" are to cash flows from operating
activities before changes in non-cash operating working capital
items, less maintenance capital expenditures net of proceeds from
disposals, scheduled debt principal payments, preferred share
dividends declared and the portion of Free Cash Flow attributed to
non-controlling interests, plus cash receipts by the Harrison Hydro
L. P. for the wheeling services to be provided to other facilities
owned by the Corporation over the course of their power purchase
agreement, plus or minus other elements that are not representative
of the Corporation's long-term cash generating capacity, such as
transaction costs related to realized acquisitions (which are
financed at the time of the acquisition), realized losses or gains
on derivative financial instruments used to hedge the interest rate
on project-level debt or the exchange rate on equipment
purchases.
References to "Payout Ratio" are to dividends declared on common
shares divided by Free Cash Flow.
Readers are cautioned that Adjusted EBITDA should not be
construed as an alternative to net earnings and Free Cash Flow
should not be construed as an alternative to cash flows from
operating activities, as determined in accordance with IFRS.
Forward-looking information disclaimer
In order to inform readers of the Corporation's future
prospects, this press release contains forward-looking information
within the meaning of applicable securities laws
("Forward-Looking Information"), including, but not limited to,
statements relating to the anticipated completion of the Alterra
Transaction and timing for such completion, sources and impact of
funding of the Alterra Transaction, and strategic, operational and
financial benefits and accretion expected to result from the
Alterra Transaction. Forward-Looking Information can
generally be identified by the use of words such as "projected",
"potential", "expect", "will", "should", "estimate", "forecasts",
"intends", or other comparable terminology that states that
certain events will or will not occur. It represents the estimates
and expectations of the Corporation relating to future results
and developments as of the date of this press release. It includes
future-oriented financial information or financial
outlook within the meaning of securities laws, such as expected
production, projected revenues, projected Adjusted EBITDA ,
projected Free Cash Flow and estimated project costs, to inform
readers of the potential financial impact of expected results, of
the expected commissioning of Development Projects, of the
potential financial impact of the acquisitions, of the
Corporation's ability to sustain current dividends and dividend
increases and of its ability to fund its growth. Such information
may not be appropriate for other purposes.
Forward-Looking Information in this press release is based on
certain key expectations and assumptions made by the Corporation.
The following table outlines Forward-Looking Information contained
in this press release, the principal assumptions used to derive
this information and the principal risks and uncertainties that
could cause actual results to differ materially from this
information.
Principal
Assumptions
|
Principal Risks and
Uncertainties
|
Expected
production
For each facility,
the Corporation determines a long-term average annual level of
electricity production ("LTA") over the expected life of the
facility, based on engineers' studies that take into consideration
a number of important factors: for hydroelectricity, the
historically observed flows of the river, the operating head, the
technology employed and the reserved aesthetic and ecological
flows; for wind energy, the historical wind and meteorological
conditions and turbine technology; and for solar energy, the
historical solar irradiation conditions, panel technology and
expected solar panel degradation. Other factors taken into account
include, without limitation, site topography, installed capacity,
energy losses, operational features and maintenance. Although
production will fluctuate from year to year, over an extended
period it should approach the estimated long-term average. On a
consolidated basis, the Corporation estimates the LTA by adding
together the expected LTA of all the facilities in operation that
it consolidates (excludes Umbata Falls and Viger-Denonville, which
are accounted for using the equity method).
|
Improper assessment
of water, wind and sun resources and associated electricity
production
Variability in hydrology, wind regimes and solar irradiation
Equipment failure or unexpected operations and maintenance
activity
Natural disaster
|
Estimated project
costs, expected obtainment of permits, start of construction,
work conducted and start of commercial operation for
Development Projects or Prospective Projects
For each development
project, the Corporation provides an estimate of project costs
based on its extensive experience as a developer, directly related
incremental internal costs, site acquisition costs and financing
costs, which are eventually adjusted for the projected costs
provided by the engineering, procurement and construction ("EPC")
contractor retained for the project.
The Corporation
provides indications regarding scheduling and construction progress
for its Development Projects and indications regarding its
Prospective Projects, based on its extensive experience as a
developer.
|
Performance of
counterparties, such as the EPC contractors
Delays and cost
overruns in the design and construction of projects
Obtainment of
permits
Equipment
supply
Interest rate
fluctuations and financing risk
Relationships with
stakeholders
Regulatory and
political risks
Higher-than-expected
inflation
Natural
disaster
|
Projected
Revenues
For each facility,
expected annual revenues are estimated by multiplying the LTA by a
price for electricity stipulated in the power purchase agreement
secured with a public utility or other creditworthy counterparty.
These agreements stipulate a base price and, in some cases, a price
adjustment depending on the month, day and hour of delivery. In
most cases, power purchase agreements also contain an annual
inflation adjustment based on a portion of the Consumer Price
Index.
|
Production levels
below the LTA caused mainly by the risks and uncertainties
mentioned above
Unexpected seasonal
variability in the production and delivery of
electricity
Lower-than-expected
inflation rate
Changes in the
purchase price of electricity upon renewal of a PPA
|
Projected Adjusted
EBITDA
For each facility,
the Corporation estimates annual operating earnings by subtracting
from the estimated revenues the budgeted annual operating costs,
which consist primarily of operators' salaries, insurance premiums,
operations and maintenance expenditures, property taxes and
royalties; these are predictable and relatively fixed, varying
mainly with inflation (except for maintenance
expenditures).
|
Lower revenues caused
mainly by the risks and uncertainties mentioned above
Variability of
facility performance and related penalties
Unexpected
maintenance expenditures
|
Projected Free
Cash Flow and intention to pay dividend quarterly
The Corporation
estimates Projected Free Cash Flow as projected cash flows from
operating activities before changes in non-cash operating working
capital items, less estimated maintenance capital expenditures net
of proceeds from disposals, scheduled debt principal payments,
preferred share dividends declared and the portion of Free Cash
Flow attributed to non-controlling interests, plus cash receipts by
the Harrison Hydro L.P. for the wheeling services to be provided to
other facilities owned by the Corporation over the course of their
power purchase agreement, plus or minus other elements that are not
representative of the Corporation's long-term cash generating
capacity, such as transaction costs related to realized
acquisitions (which are financed at the time of the acquisition),
realized losses or gains on derivative financial instruments
used to hedge the interest rate on project-level debt or the
exchange rate on equipment purchases.
The Corporation
estimates the annual dividend it intends to distribute based on the
Corporation operating results, cash flows, financial conditions,
debt covenants, long term growth prospects, solvency, test imposed
under corporate law for declaration of dividends and other relevant
factors.
|
Adjusted EBITDA below
expectations caused mainly by the risks and uncertainties mentioned
above and by higher prospective project expenses
Projects costs above
expectations caused mainly by the performance of counterparties and
delays and cost overruns in the design and construction of
projects
Regulatory and
political risk
Interest rate
fluctuations and financing risk
Financial leverage and restrictive covenants governing current and
future indebtedness
Unexpected
maintenance capital expenditures
Possibility that the
Corporation may not declare or pay a dividend
|
The material risks and uncertainties that may cause actual
results and developments to be materially different from current
expressed Forward-Looking Information are referred to in the
Corporation's Annual Information Form in the "Risk Factors"
section and include, without limitation: the ability of the
Corporation to execute its strategy for building shareholder value;
its ability to raise additional capital and the state of capital
markets; liquidity risks related to derivative financial
instruments; variability in hydrology, wind regimes and solar
irradiation; delays and cost overruns in the design and
construction of projects; the ability to secure new power purchase
agreements or renew any power purchase agreements on equivalent
terms and conditions; uncertainty surrounding the development of
new facilities; change in governmental support to increase
electricity to be generated from renewable sources by independent
power producers; foreign market growth and development risks;
sufficiency of insurance coverage limits and exclusions; and the
ability to secure new power purchase agreements or to renew
existing ones.
There are also risks inherent to the Alterra Transaction,
including incorrect assessments of the value of the other entity;
failure to satisfy the closing conditions; exercise of termination
rights by the Corporation or Alterra; failure to obtain the
requisite shareholder, court, regulatory and other third-party
approvals, including approval by the Competition Bureau, the
Federal Energy Regulatory Commission (FERC), the Federal Trade
Commission and similar authorities in other jurisdictions, as well
as the TSX. Accordingly, there can be no assurance that the Alterra
Transaction will occur, or that it will occur on the terms and
conditions, or at the time, contemplated in this news release. The
Alterra Transaction could be modified, restructured or terminated.
There can also be no assurance that the strategic, operational or
financial benefits expected to result from the Alterra Transaction
will be realized. If the Alterra Transaction is not completed, and
the Corporation and Alterra continue as separate entities, there
are risks that the announcement of the Transaction and the
dedication of substantial resources of the Corporation to the
completion of the Alterra Transaction could have an impact on the
Corporation's business and strategic relationships (including with
future and prospective employees, customers, distributors,
suppliers and partners), operating results and businesses
generally, and could have a material adverse effect on the current
and future operations, financial condition and prospects of the
Corporation.
Although the Corporation believes that the expectations and
assumptions on which Forward-Looking Information is based are
reasonable, readers of this press release are cautioned not to rely
unduly on this Forward-Looking Information since no assurance can
be given that they will prove to be correct. The Corporation does
not undertake any obligation to update or revise any
Forward-Looking Information, whether as a result of events or
circumstances occurring after the date of this press release,
unless so required by legislation.
SOURCE Innergex Énergie Renouvelable Inc.