-
Closed the acquisition of Duquesne University's district energy
system
-
Raised new corporate growth capital by refinancing non-recourse
debt at the Tapestry Wind portfolio
-
Advanced the Hawaii Solar Phase I ROFO projects through an initial
partnership investment
-
Repaid outstanding balance of the 2019 Convertible Notes with cash
on hand
-
Declared quarterly dividend of $0.20 per share in second quarter
2019
-
Maintaining 2019 CAFD guidance
PRINCETON, N.J.--(BUSINESS WIRE)--May 7, 2019--
Clearway Energy, Inc. (NYSE: CWEN, CWEN.A) today reported first quarter
2019 financial results, including a Net Loss of $47 million, Adjusted
EBITDA of $191 million, Cash from Operating Activities of $61 million,
and Cash Available for Distribution (CAFD) of $(13) million, which
includes adjustments to reflect CAFD generated by unconsolidated
investments that are unable to distribute project dividends due to the
PG&E bankruptcy.
“Despite the PG&E situation impacting the Company in the near term,
Clearway continues to make strides in advancing its business plan and
growing long term CAFD per share by expanding the Thermal Segment
through the acquisition of Duquesne University’s district energy system,
progressing the partnership with Clearway Group on the Hawaii Solar
Phase I ROFO projects, and raising additional corporate growth capital
with the refinancing of the Tapestry Wind portfolio,” said Christopher
Sotos, Clearway Energy, Inc.’s President and Chief Executive Officer.
“While the Company's first quarter results were within expectations,
timing shifts related to operating expenses, capital expenditures and
distributions from unconsolidated affiliates temporarily offset the
negative impact resulting from weak renewable energy conditions across
the portfolio."
Overview of Financial and Operating Results
Segment Results
Table 1: Net (Loss)/Income
($ millions)
|
|
Three Months Ended
|
Segment
|
|
3/31/19
|
|
3/31/18
|
Conventional
|
|
24
|
|
|
27
|
|
Renewables
|
|
(56
|
)
|
|
(8
|
)
|
Thermal
|
|
5
|
|
|
8
|
|
Corporate
|
|
(20
|
)
|
|
(27
|
)
|
Net Loss
|
|
(47
|
)
|
|
0
|
|
|
|
|
|
|
|
|
Table 2: Adjusted EBITDA
($ millions)
|
|
Three Months Ended
|
Segment
|
|
3/31/19
|
|
3/31/18
|
Conventional
|
|
69
|
|
|
66
|
|
Renewables
|
|
111
|
|
|
112
|
|
Thermal
|
|
16
|
|
|
16
|
|
Corporate
|
|
(5
|
)
|
|
(5
|
)
|
Adjusted EBITDA
|
|
191
|
|
|
189
|
|
|
|
|
|
|
|
|
Table 3: Cash from Operating Activities and Cash Available for
Distribution (CAFD)
|
|
Three Months Ended
|
($ millions)
|
|
3/31/19
|
|
3/31/18
|
Cash from Operating Activities
|
|
61
|
|
|
65
|
|
Cash Available for Distribution (CAFD)11
|
|
(13
|
)
|
|
(4
|
)
|
|
|
|
|
|
|
|
For the first quarter of 2019, the Company reported a Net Loss of $47
million, Adjusted EBITDA of $191 million, Cash from Operating Activities
of $61 million, and CAFD of $(13) million, which includes adjustments to
reflect CAFD generated by unconsolidated investments that are unable to
distribute project dividends due to the PG&E bankruptcy. Net Income was
lower primarily due to non-cash changes in the fair value of interest
rate swaps. Adjusted EBITDA results were higher than 2018 primarily due
to the impact of growth investments, but partially offset by weaker
renewable energy conditions versus the first quarter of 2018. In the
first quarter, CAFD results were lower than 2018 primarily due to weaker
renewable energy conditions, lower tax equity proceeds following the
buyout of the Wind TE Holdco tax equity partnership, and the expiration
of network upgrade reimbursements.
Operational Performance
Table 4: Selected Operating Results
(MWh and MWht in thousands)
|
|
Three Months Ended
|
|
|
3/31/19
|
|
3/31/18
|
Equivalent Availability Factor (Conventional)
|
|
89.0
|
%
|
|
85.0
|
%
|
Renewables Generation Sold (MWh)2
|
|
1,449
|
|
1,616
|
Thermal Generation Sold (MWh/MWht)
|
|
658
|
|
626
|
|
|
|
|
|
In the first quarter of 2019, availability at the Conventional segment
was higher than the first quarter of 2018 due to extended spring outages
during 2018 in connection with work at Walnut Creek related to the
amended comprehensive service agreement executed in 2017 with the
original equipment manufacturer.
During the quarter, generation in the Renewables segment was below
median expectations and 10% lower than the first quarter of 2018
primarily due to weak wind and solar conditions across the portfolio.
This was partially offset by the addition of Buckthorn Solar, which
reached COD in July 2018.
Liquidity and Capital Resources
Table 5: Liquidity
($ millions)
|
|
3/31/19
|
|
12/31/18
|
Cash and Cash Equivalents:
|
|
|
|
|
Clearway Energy, Inc. and Clearway Energy LLC, excluding subsidiaries
|
|
$
|
37
|
|
|
$
|
298
|
Subsidiaries
|
|
80
|
|
|
109
|
Restricted Cash:
|
|
|
|
|
Operating accounts
|
|
57
|
|
|
84
|
Reserves, including debt service, distributions, performance
obligations and other reserves
|
|
124
|
|
|
92
|
Total Cash
|
|
$
|
298
|
|
|
$
|
583
|
Revolving credit facility availability
|
|
$
|
454
|
|
|
$
|
454
|
Total Liquidity
|
|
$
|
752
|
|
|
$
|
1,037
|
|
|
|
|
|
|
|
|
Total liquidity as of March 31, 2019 was $752 million, $285 million
lower than as of December 31, 2018. This decrease was primarily due to
the repayment, with cash on hand, of $220 million in outstanding 2019
Convertible Notes and $19 million for the buyout of the Wind TE HoldCo
tax equity partnership in January 2019. Borrowing capacity under the
revolving credit facility remained unchanged.
The Company's liquidity includes $181 million of restricted cash
balances as of March 31, 2019. Restricted cash consists primarily of
funds to satisfy the requirements of certain debt arrangements and funds
held within the Company's projects that are restricted in their use. As
of March 31, 2019, these restricted funds were comprised of $57 million
designated to fund operating expenses, approximately $43 million
designated for current debt service payments, and $39 million of
reserves for debt service, performance obligations and other items
including capital expenditures. The remaining $42 million is held in
distribution accounts, of which $36 million related to subsidiaries
affected by the PG&E bankruptcy.
Potential future sources of liquidity include excess operating cash
flow, the existing $150 million ATM program, of which $36 million
remained available as of May 7, 2019, availability under the revolving
credit facility, and, subject to market conditions, new corporate
financings.
PG&E Bankruptcy Update
As of May 6, 2019, PG&E has neither assumed, rejected, or sought to
renegotiate any of its contracts with the Company. While the Company is
actively seeking forbearance agreements with non-recourse project level
lenders, unless such lenders for the related project level debt
otherwise agree, distributions to the Company from these projects may
not be made during the pendency of the bankruptcy, although the Company
currently expects these projects to otherwise operate in the normal
course of business. These restrictions, therefore, have resulted in the
Company accumulating less unrestricted cash and thus decreased the
Company’s corporate liquidity and cash available for shareholder
dividends and growth investments.
Growth Investments
Acquisition of Duquesne University's District Energy System
On May 1, 2019, the Company, through its indirect subsidiary ECP Uptown
Campus LLC, acquired the combined 87 MWt Duquesne University district
energy system located in Pittsburgh, Pennsylvania from Duquesne
University. The project will provide steam, chilled water and emergency
backup power service to the University under a 40-year energy services
agreement and is expected to be interconnected with the Company’s
existing district energy system in Pittsburgh. The total investment for
the project, including capital expenditures required to interconnect to
the Company’s existing system, is approximately $107 million. In
connection with the project, ECP Uptown Campus LLC issued non-recourse
debt totaling approximately $93 million, net of fees. The Company used
the proceeds from the debt issuance and cash on hand to purchase the
project from the University. Net of this non-recourse financing, the
project is expected to contribute CAFD on an average annual basis of
approximately $1.8 million3 beginning in 2020.
Hawaii Solar Phase I ROFO Acquisition Update
On March 8, 2019, the Company made an initial capital contribution in
the amount of $4 million to the Oahu Partnership, which is a component
of the previously disclosed Hawaii Solar Phase I ROFO Acquisition. The
Oahu Partnership consists of Lanikuhana and Waipio, utility-scale solar
generation projects which represent 15 MW and 46 MW respectively, and
are being developed in Oahu, Hawaii. In aggregate, the Hawaii Solar
Phase I ROFO Acquisition totals 80 MW of utility-scale solar projects
located in Kawailoa and Oahu, Hawaii and is being purchased from
Clearway Group for a total cash consideration of $28 million (of which
$24 million remains following the aforementioned initial capital
contribution) plus the assumption of non-recourse debt of $169 million.
The purchase price for the Hawaii Solar Phase I projects will be funded
with existing liquidity and is expected to contribute CAFD on an average
annual basis of approximately $2.6 million4 beginning in
2020. The projects are expected to be completed in summer 2019.
DG Investment Partnerships with Clearway Group
During the first quarter of 2019, the Company invested approximately $4
million in the DG investment partnerships with Clearway Group, bringing
total capital invested to $246 million5 in these
investment partnerships. As of March 31, 2019, through the existing
partnership agreements, the Company owns approximately 253 MW6 of
distributed and community solar capacity with a weighted average
contract life by CAFD of approximately 19 years.
Financing Update
Tapestry Wind Refinancing
On April 29, 2019, the Company, through Tapestry Wind LLC, refinanced
$147 million of non-recourse debt due 2021 by issuing $164 million of
new non-recourse refinancing due 2031. Through this transaction, net of
fees and financing costs, the Company received $11 million in
incremental capital to be utilized for growth.
Convertible Notes Repurchase
In the first quarter of 2019 the Company repaid the remaining $220
million of 2019 Convertible Notes with cash on hand. Other than the
remaining $45 million of 2020 Convertible Notes due in June 2020, the
Company has no outstanding corporate maturities due until 2024.
Quarterly Dividend
On May 1, 2019, Clearway Energy, Inc.’s Board of Directors declared a
quarterly dividend on Class A and Class C common stock of $0.20 per
share payable on June 17, 2019, to stockholders of record as of June 3,
2019. The Company will continue to assess the level of the dividend
pending developments in the PG&E Bankruptcy, including the Company's
ability to receive unrestricted project distributions.
Seasonality
Clearway Energy, Inc.’s quarterly operating results are impacted by
seasonal factors, as well as variability in renewable energy resources.
The majority of the Company's revenues are generated from the months of
May through September, as contracted pricing and renewable resources are
at their highest levels in the Company’s portfolio. Factors driving the
fluctuation in Net Income, Adjusted EBITDA, Cash from Operating
Activities, and CAFD include the following:
-
Higher summer capacity prices from conventional assets;
-
Higher solar insolation during the summer months;
-
Higher wind resources during the spring and summer months;
-
Debt service payments which are made either quarterly or semi-annually;
-
Timing of maintenance capital expenditures and the impact of both
unforced and forced outages; and
-
Receipt of distributions from or generated by unconsolidated
affiliates impacted by the PG&E bankruptcy
The Company takes into consideration the timing of these factors to
ensure sufficient funds are available for distributions and operating
activities on a quarterly basis.
2019 Financial Guidance
The Company is maintaining its 2019 full year CAFD guidance of $270
million. This financial guidance assumes that all CAFD related to the
projects impacted by the PG&E Bankruptcy is realized in 2019. Financial
guidance for 2019 also continues to be based on median renewable energy
production estimates for the full year.
Earnings Conference Call
On May 7, 2019, Clearway Energy, Inc. will host a conference call at
8:00 a.m. Eastern to discuss these results. Investors, the news media
and others may access the live webcast of the conference call and
accompanying presentation materials by logging on to Clearway Energy,
Inc.’s website at http://www.clearwayenergy.com
and clicking on “Presentations & Webcasts” under “Investor Relations.”
About Clearway Energy, Inc.
Clearway Energy, Inc. is a leading publicly-traded energy infrastructure
investor focused on modern, sustainable and long-term contracted assets
across North America. Clearway Energy’s environmentally-sound asset
portfolio includes over 7,000 megawatts of wind, solar and natural
gas-fired power generation facilities, as well as district energy
systems. Through this diversified and contracted portfolio, Clearway
Energy endeavors to provide its investors with stable and growing
dividend income. Clearway Energy’s Class C and Class A common stock are
traded on the New York Stock Exchange under the symbols CWEN and CWEN.A,
respectively. Clearway Energy, Inc. is sponsored by its controlling
investor Global Infrastructure Partners III (GIP), an independent
infrastructure fund manager that invests in infrastructure and
businesses in both OECD and select emerging market countries, through
GIP’s portfolio company, Clearway Energy Group.
Safe Harbor Disclosure
This news release contains forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Such forward-looking statements are
subject to certain risks, uncertainties and assumptions, and typically
can be identified by the use of words such as “expect,” “estimate,”
“anticipate,” “forecast,” “plan,” “outlook,” “believe” and similar
terms. Such forward-looking statements include, but are not limited to,
statements regarding impacts resulting from the PG&E bankruptcy, the
benefits of the relationship with Global Infrastructure Partners III
(GIP) and GIP’s expertise, the Company’s future relationship and
arrangements with GIP and Clearway Energy Group, as well as the
Company's Net Income, Adjusted EBITDA, Cash from Operating Activities,
Cash Available for Distribution, the Company’s future revenues, income,
indebtedness, capital structure, strategy, plans, expectations,
objectives, projected financial performance and/or business results and
other future events, and views of economic and market conditions.
Although Clearway Energy, Inc. believes that the expectations are
reasonable, it can give no assurance that these expectations will prove
to be correct, and actual results may vary materially. Factors that
could cause actual results to differ materially from those contemplated
above include, among others, impacts relating to the PG&E bankruptcy,
general economic conditions, hazards customary in the power industry,
weather conditions, including wind and solar performance, competition in
wholesale power markets, the volatility of energy and fuel prices,
failure of customers to perform under contracts, changes in the
wholesale power markets, changes in government regulations, the
condition of capital markets generally, the Company's ability to access
capital markets, cyber terrorism and inadequate cybersecurity, the
ability to engage in successful acquisitions activity, unanticipated
outages at its generation facilities, adverse results in current and
future litigation, failure to identify, execute or successfully
implement acquisitions (including receipt of third party consents and
regulatory approvals), the Company's ability to enter into new contracts
as existing contracts expire, risk relating to the Company's
relationships with GIP and Clearway Energy Group, the Company's ability
to acquire assets from GIP, Clearway Energy Group or third parties, the
Company's ability to close drop down transactions, and the Company's
ability to maintain and grow its quarterly dividends. Furthermore, any
dividends are subject to available capital, market conditions, and
compliance with associated laws and regulations.
Clearway Energy, Inc. undertakes no obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise. The Adjusted EBITDA and Cash Available for
Distribution are estimates as of today’s date, May 7, 2019, and are
based on assumptions believed to be reasonable as of this date. Clearway
Energy, Inc. expressly disclaims any current intention to update such
guidance. The foregoing review of factors that could cause Clearway
Energy, Inc.’s actual results to differ materially from those
contemplated in the forward-looking statements included in this news
release should be considered in connection with information regarding
risks and uncertainties that may affect Clearway Energy, Inc.’s future
results included in Clearway Energy, Inc.’s filings with the Securities
and Exchange Commission at www.sec.gov.
In addition, Clearway Energy, Inc. makes available free of charge at www.clearwayenergy.com,
copies of materials it files with, or furnishes to, the SEC.
|
CLEARWAY ENERGY, INC.
|
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(Unaudited)
|
|
|
|
Three months ended March 31,
|
(In millions, except per share amounts)
|
|
2019
|
|
2018
|
Operating Revenues
|
|
|
|
|
Total operating revenues
|
|
$
|
217
|
|
|
$
|
225
|
|
Operating Costs and Expenses
|
|
|
|
|
Cost of operations
|
|
84
|
|
|
89
|
|
Depreciation and amortization
|
|
84
|
|
|
81
|
|
General and administrative
|
|
6
|
|
|
5
|
|
Transaction and integration costs
|
|
1
|
|
|
1
|
|
Development costs
|
|
1
|
|
|
—
|
|
Total operating costs and expenses
|
|
176
|
|
|
176
|
|
Operating Income
|
|
41
|
|
|
49
|
|
Other Income (Expense)
|
|
|
|
|
Equity in earnings of unconsolidated affiliates
|
|
3
|
|
|
4
|
|
Other income, net
|
|
3
|
|
|
1
|
|
Interest expense
|
|
(101
|
)
|
|
(55
|
)
|
Total other expense, net
|
|
(95
|
)
|
|
(50
|
)
|
Income Before Income Taxes
|
|
(54
|
)
|
|
(1
|
)
|
Income tax benefit
|
|
(7
|
)
|
|
(1
|
)
|
Net Loss
|
|
(47
|
)
|
|
—
|
|
Less: Pre-acquisition net income of Drop Down Assets
|
|
—
|
|
|
4
|
|
Net Loss Excluding Pre-acquisition Net Income of Drop Down Assets
|
|
(47
|
)
|
|
(4
|
)
|
Less: Loss attributable to noncontrolling interests
|
|
(27
|
)
|
|
(20
|
)
|
Net (Loss) Income Attributable to Clearway Energy, Inc.
|
|
$
|
(20
|
)
|
|
$
|
16
|
|
(Losses) Earnings Per Share Attributable to Clearway Energy,
Inc. Class A and Class C Common Stockholders
|
|
|
|
|
Weighted average number of Class A common shares outstanding -
basic and diluted
|
|
35
|
|
|
35
|
|
Weighted average number of Class C common shares outstanding -
basic and diluted
|
|
73
|
|
|
65
|
|
(Losses) Earnings per Weighted Average Class A and Class C
Common Share - Basic and Diluted
|
|
$
|
(0.18
|
)
|
|
$
|
0.16
|
|
Dividends Per Class A Common Share
|
|
0.20
|
|
|
0.298
|
|
Dividends Per Class C Common Share
|
|
$
|
0.20
|
|
|
$
|
0.298
|
|
|
|
|
|
|
|
|
|
|
|
CLEARWAY ENERGY, INC.
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
(Unaudited)
|
|
|
|
Three months ended March 31,
|
(In millions)
|
|
2019
|
|
2018
|
Net Loss
|
|
$
|
(47
|
)
|
|
$
|
—
|
|
Other Comprehensive (Loss) Gain
|
|
|
|
|
Unrealized (loss) gain on derivatives, net of income tax expense of
$0 and $3
|
|
(2
|
)
|
|
17
|
|
Other comprehensive (loss) gain
|
|
(2
|
)
|
|
17
|
|
Comprehensive (Loss) Income
|
|
(49
|
)
|
|
17
|
|
Less: Pre-acquisition net income of Drop Down Assets
|
|
—
|
|
|
4
|
|
Less: Comprehensive loss attributable to noncontrolling interests
|
|
(28
|
)
|
|
(11
|
)
|
Comprehensive (Loss) Income Attributable to Clearway Energy, Inc.
|
|
$
|
(21
|
)
|
|
$
|
24
|
|
|
|
|
|
|
|
|
|
|
|
CLEARWAY ENERGY, INC.
|
CONSOLIDATED BALANCE SHEETS
|
|
(In millions, except shares)
|
|
March 31, 2019
|
|
December 31, 2018
|
ASSETS
|
|
(unaudited)
|
|
|
Current Assets
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
117
|
|
|
$
|
407
|
|
Restricted cash
|
|
181
|
|
|
176
|
|
Accounts receivable — trade
|
|
91
|
|
|
104
|
|
Inventory
|
|
40
|
|
|
40
|
|
Prepayments and other current assets
|
|
27
|
|
|
29
|
|
Total current assets
|
|
456
|
|
|
756
|
|
Property, plant and equipment, net
|
|
5,355
|
|
|
5,245
|
|
Other Assets
|
|
|
|
|
Equity investments in affiliates
|
|
1,154
|
|
|
1,172
|
|
Intangible assets, net
|
|
1,139
|
|
|
1,156
|
|
Derivative instruments
|
|
—
|
|
|
8
|
|
Deferred income taxes
|
|
65
|
|
|
57
|
|
Right of use assets, net
|
|
168
|
|
|
—
|
|
Other non-current assets
|
|
128
|
|
|
106
|
|
Total other assets
|
|
2,654
|
|
|
2,499
|
|
Total Assets
|
|
$
|
8,465
|
|
|
$
|
8,500
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
Current Liabilities
|
|
|
|
|
Current portion of long-term debt
|
|
$
|
1,598
|
|
|
$
|
535
|
|
Accounts payable — trade
|
|
55
|
|
|
45
|
|
Accounts payable — affiliate
|
|
42
|
|
|
19
|
|
Derivative instruments
|
|
11
|
|
|
4
|
|
Accrued interest expense
|
|
46
|
|
|
44
|
|
Accrued expenses and other current liabilities
|
|
35
|
|
|
57
|
|
Total current liabilities
|
|
1,787
|
|
|
704
|
|
Other Liabilities
|
|
|
|
|
Long-term debt
|
|
4,225
|
|
|
5,447
|
|
Derivative instruments
|
|
31
|
|
|
17
|
|
Long-term lease liabilities
|
|
168
|
|
|
—
|
|
Other non-current liabilities
|
|
109
|
|
|
108
|
|
Total non-current liabilities
|
|
4,533
|
|
|
5,572
|
|
Total Liabilities
|
|
6,320
|
|
|
6,276
|
|
Commitments and Contingencies
|
|
|
|
|
Stockholders' Equity
|
|
|
|
|
Preferred stock, $0.01 par value; 10,000,000 shares authorized; none
issued
|
|
—
|
|
|
—
|
|
Class A, Class B, Class C and Class D common stock, $0.01 par
value; 3,000,000,000 shares authorized (Class A 500,000,000,
Class B 500,000,000, Class C 1,000,000,000, Class D
1,000,000,000); 193,402,886 shares issued and outstanding (Class A
34,599,645, Class B 42,738,750, Class C 73,325,741, Class D
42,738,750) at March 31, 2019 and 193,251,396 shares issued
and outstanding (Class A 34,586,250, Class B 42,738,750, Class C
73,187,646, Class D 42,738,750) at December 31, 2018
|
|
1
|
|
|
1
|
|
Additional paid-in capital
|
|
1,870
|
|
|
1,897
|
|
Accumulated deficit
|
|
(80
|
)
|
|
(58
|
)
|
Accumulated other comprehensive loss
|
|
(19
|
)
|
|
(18
|
)
|
Noncontrolling interest
|
|
373
|
|
|
402
|
|
Total Stockholders' Equity
|
|
2,145
|
|
|
2,224
|
|
Total Liabilities and Stockholders' Equity
|
|
$
|
8,465
|
|
|
$
|
8,500
|
|
|
|
|
|
|
|
|
|
|
|
CLEARWAY ENERGY, INC.
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(Unaudited)
|
|
|
|
Three months ended March 31,
|
|
|
2019
|
|
2018
|
|
|
(In millions)
|
Cash Flows from Operating Activities
|
|
|
|
|
Net loss
|
|
$
|
(47
|
)
|
|
$
|
—
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
Equity in earnings of unconsolidated affiliates
|
|
(3
|
)
|
|
(4
|
)
|
Distributions from unconsolidated affiliates
|
|
11
|
|
|
13
|
|
Depreciation and amortization
|
|
84
|
|
|
81
|
|
Amortization of financing costs and debt discounts
|
|
4
|
|
|
7
|
|
Amortization of intangibles and out-of-market contracts
|
|
17
|
|
|
17
|
|
Changes in deferred income taxes
|
|
(7
|
)
|
|
(1
|
)
|
Derivative interest expense (income)
|
|
28
|
|
|
(23
|
)
|
Loss on disposal of asset components
|
|
2
|
|
|
2
|
|
Changes in prepaid and accrued liabilities for tolling agreements
|
|
(35
|
)
|
|
(36
|
)
|
Changes in other working capital
|
|
7
|
|
|
9
|
|
Net Cash Provided by Operating Activities
|
|
61
|
|
|
65
|
|
Cash Flows from Investing Activities
|
|
|
|
|
Acquisition of interest in Oahu Partnership
|
|
(4
|
)
|
|
—
|
|
Acquisition of the Buckthorn Solar Drop Down Asset
|
|
—
|
|
|
(42
|
)
|
Buyout of Wind TE Holdco noncontrolling interest
|
|
(19
|
)
|
|
—
|
|
Capital expenditures
|
|
(16
|
)
|
|
(18
|
)
|
Cash receipts from notes receivable
|
|
—
|
|
|
4
|
|
Return of investment from unconsolidated affiliates
|
|
14
|
|
|
14
|
|
Investments in unconsolidated affiliates
|
|
(4
|
)
|
|
(6
|
)
|
Other
|
|
3
|
|
|
4
|
|
Net Cash Used in Investing Activities
|
|
(26
|
)
|
|
(44
|
)
|
Cash Flows from Financing Activities
|
|
|
|
|
Net contributions from noncontrolling interests
|
|
19
|
|
|
30
|
|
Proceeds from the issuance of common stock
|
|
—
|
|
|
10
|
|
Payments of dividends and distributions
|
|
(39
|
)
|
|
(55
|
)
|
Proceeds from the revolving credit facility
|
|
—
|
|
|
20
|
|
Proceeds from the issuance of long-term debt
|
|
4
|
|
|
14
|
|
Payments for long-term debt
|
|
(304
|
)
|
|
(79
|
)
|
Net Cash Used in Financing Activities
|
|
(320
|
)
|
|
(60
|
)
|
Net Decrease in Cash, Cash Equivalents and Restricted Cash
|
|
(285
|
)
|
|
(39
|
)
|
Cash, Cash Equivalents and Restricted Cash at beginning of period
|
|
583
|
|
|
316
|
|
Cash, Cash Equivalents and Restricted Cash at end of period
|
|
$
|
298
|
|
|
$
|
277
|
|
|
|
|
|
|
|
|
|
|
|
Appendix Table A-1: Three Months Ended March 31, 2019, Segment
Adjusted EBITDA Reconciliation
|
The following table summarizes the calculation of Adjusted EBITDA
and provides a reconciliation to Net Income/(Loss):
|
|
|
|
|
|
|
|
|
|
|
|
($ in millions)
|
|
Conventional
|
|
Renewables
|
|
Thermal
|
|
Corporate
|
|
Total
|
Net (Loss) Income
|
|
$
|
24
|
|
|
$
|
(56
|
)
|
|
$
|
5
|
|
|
$
|
(20
|
)
|
|
$
|
(47
|
)
|
Plus:
|
|
|
|
|
|
|
|
|
|
|
Income Tax Benefit
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
|
(7
|
)
|
Interest Expense, net
|
|
15
|
|
|
59
|
|
|
4
|
|
|
20
|
|
|
98
|
|
Depreciation, Amortization, and ARO
|
|
25
|
|
|
54
|
|
|
6
|
|
|
—
|
|
|
85
|
|
Contract Amortization
|
|
1
|
|
|
15
|
|
|
1
|
|
|
—
|
|
|
17
|
|
Mark to Market (MtM) Losses on Economic Hedges
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
7
|
|
Transaction and Integration costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
Other Non-recurring Charges
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
Adjustments to reflect CWEN’s pro-rata share of Adjusted
EBITDA from Unconsolidated Affiliates
|
|
4
|
|
|
32
|
|
|
—
|
|
|
—
|
|
|
36
|
|
Adjusted EBITDA
|
|
$
|
69
|
|
|
$
|
111
|
|
|
$
|
16
|
|
|
$
|
(5
|
)
|
|
$
|
191
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Appendix Table A-2: Three Months Ended March 31, 2018, Segment
Adjusted EBITDA Reconciliation
|
The following table summarizes the calculation of Adjusted EBITDA
and provides a reconciliation to Net Income/(Loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
($ in millions)
|
|
Conventional
|
|
Renewables
|
|
Thermal
|
|
Corporate
|
|
Total
|
Net Income (Loss)
|
|
$
|
27
|
|
|
$
|
(8
|
)
|
|
$
|
8
|
|
|
$
|
(27
|
)
|
|
$
|
—
|
|
Plus:
|
|
|
|
|
|
|
|
|
|
|
Income Tax Benefit
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
Interest Expense, net
|
|
7
|
|
|
23
|
|
|
2
|
|
|
22
|
|
|
54
|
|
Depreciation, Amortization, and ARO
|
|
26
|
|
|
51
|
|
|
5
|
|
|
—
|
|
|
82
|
|
Contract Amortization
|
|
1
|
|
|
15
|
|
|
1
|
|
|
—
|
|
|
17
|
|
Transaction and Integration costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
Other Non-recurring Charges
|
|
1
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
2
|
|
Adjustments to reflect CWEN’s pro-rata share of Adjusted
EBITDA from Unconsolidated Affiliates
|
|
4
|
|
|
30
|
|
|
—
|
|
|
—
|
|
|
34
|
|
Adjusted EBITDA
|
|
$
|
66
|
|
|
$
|
112
|
|
|
$
|
16
|
|
|
$
|
(5
|
)
|
|
$
|
189
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Appendix Table A-3: Cash Available for Distribution Reconciliation
The following table summarizes the calculation of Cash Available for
Distribution and provides a reconciliation to Cash from Operating
Activities:
|
|
|
|
|
Three Months Ended
|
($ in millions)
|
|
3/31/19
|
|
3/31/18
|
Adjusted EBITDA
|
|
$
|
191
|
|
|
$
|
189
|
|
Cash interest paid
|
|
(73
|
)
|
|
(75
|
)
|
Changes in prepaid and accrued liabilities for tolling agreements
|
|
(35
|
)
|
|
(36
|
)
|
Adjustment to reflect Walnut Creek investment payments
|
|
(5
|
)
|
|
—
|
|
Pro-rata Adjusted EBITDA from unconsolidated affiliates
|
|
(38
|
)
|
|
(38
|
)
|
Distributions from unconsolidated affiliates
|
|
11
|
|
|
13
|
|
Changes in working capital and other
|
|
10
|
|
|
12
|
|
Cash from Operating Activities
|
|
61
|
|
|
65
|
|
Changes in working capital and other
|
|
(10
|
)
|
|
(12
|
)
|
Development Expenses7
|
|
1
|
|
|
—
|
|
Return of investment from unconsolidated affiliates
|
|
14
|
|
|
14
|
|
Net contributions from non-controlling interest8
|
|
2
|
|
|
11
|
|
Maintenance capital expenditures9
|
|
(4
|
)
|
|
(7
|
)
|
Principal amortization of indebtedness10
|
|
(84
|
)
|
|
(79
|
)
|
Cash receipts from notes receivable11
|
|
—
|
|
|
4
|
|
Adjustments to reflect CAFD generated by unconsolidated investments
that are unable to distribute project dividends due to the
PG&E bankruptcy
|
|
7
|
|
|
—
|
|
Cash Available for Distribution
|
|
$
|
(13
|
)
|
|
$
|
(4
|
)
|
|
|
|
|
|
|
|
|
|
|
Appendix Table A-4: Three Months Ended March 31, 2019, Sources
and Uses of Liquidity
|
The following table summarizes the sources and uses of liquidity
in 2019:
|
|
|
|
Three Months Ended
|
($ in millions)
|
|
3/31/19
|
Sources:
|
|
|
Net cash provided by operating activities
|
|
61
|
|
Net contributions from noncontrolling interests
|
|
19
|
|
Return of investment from unconsolidated affiliates
|
|
14
|
|
Proceeds from the issuance of long-term debt
|
|
4
|
|
Other net cash inflows
|
|
3
|
|
Uses:
|
|
|
Payments for long-term debt
|
|
(304
|
)
|
Payment of dividends and distributions
|
|
(39
|
)
|
Buyout of Wind TE Holdco noncontrolling interest
|
|
(19
|
)
|
Capital expenditures
|
|
(16
|
)
|
Acquisition of interest in Oahu Partnership
|
|
(4
|
)
|
Investments in unconsolidated affiliates
|
|
(4
|
)
|
Change in total cash, cash equivalents, and restricted cash
|
|
$
|
(285
|
)
|
|
|
|
|
|
|
Appendix Table A-5: Adjusted EBITDA and Cash Available for
Distribution Guidance
|
|
|
|
($ in millions)
|
|
2019 Full Year Guidance
|
Net Income
|
|
$
|
165
|
|
Income Tax Expense
|
|
30
|
|
Interest Expense, net
|
|
315
|
|
Depreciation, Amortization, and ARO Expense
|
|
395
|
|
Acquisition related transaction and integration costs
|
|
5
|
|
Adjustment to reflect CWEN share of Adjusted EBITDA in unconsolidated
affiliates
|
|
85
|
|
Adjusted EBITDA
|
|
995
|
|
Cash interest paid
|
|
(300
|
)
|
Changes in prepaid and accrued liabilities for tolling agreements
|
|
4
|
|
Adjustment to reflect Walnut Creek investment payments
|
|
(1
|
)
|
Pro-rata Adjusted EBITDA from unconsolidated affiliates
|
|
(215
|
)
|
Cash distributions from unconsolidated affiliates12
|
|
130
|
|
Cash from Operating Activities
|
|
613
|
|
Development Expense13
|
|
4
|
|
Net contributions from non-controlling interest14
|
|
(4
|
)
|
Maintenance capital expenditures
|
|
(30
|
)
|
Principal amortization of indebtedness15
|
|
(313
|
)
|
Cash Available for Distribution
|
|
270
|
|
Add Back: Principal amortization of indebtedness
|
|
313
|
|
Adjusted Cash from Operations
|
|
$
|
583
|
|
|
|
|
|
|
|
Appendix Table A-6: Hawaii Solar Phase I and Duquesne 5 Year
Average CAFD
|
|
($ in millions)
|
|
Hawaii Solar Phase I
5 Year Ave. - 2020-2024
|
|
Duquesne
5 Year Ave. - 2020-2024
|
Net Income
|
|
$
|
7.2
|
|
|
$
|
(0.9
|
)
|
Interest Expense, net
|
|
7.4
|
|
|
4.4
|
|
Depreciation, Amortization, and ARO Expense
|
|
10.2
|
|
|
4.3
|
|
Adjusted EBITDA
|
|
24.8
|
|
|
7.8
|
|
Cash interest paid
|
|
(7.4
|
)
|
|
(4.4
|
)
|
Cash from Operating Activities
|
|
17.4
|
|
|
3.4
|
|
Net distributions to non-controlling interest
|
|
(9.7
|
)
|
|
—
|
|
Maintenance capital expenditures
|
|
—
|
|
|
(1.5
|
)
|
Principal amortization of indebtedness
|
|
(5.1
|
)
|
|
(0.1
|
)
|
Estimated Cash Available for Distribution
|
|
2.6
|
|
|
1.8
|
|
|
|
|
|
|
|
|
EBITDA and Adjusted EBITDA are non-GAAP financial measures. These
measurements are not recognized in accordance with GAAP and should not
be viewed as an alternative to GAAP measures of performance. The
presentation of Adjusted EBITDA should not be construed as an inference
that Clearway Energy’s future results will be unaffected by unusual or
non-recurring items.
EBITDA represents net income before interest (including loss on debt
extinguishment), taxes, depreciation and amortization. EBITDA is
presented because Clearway Energy considers it an important supplemental
measure of its performance and believes debt and equity holders
frequently use EBITDA to analyze operating performance and debt service
capacity. EBITDA has limitations as an analytical tool, and you should
not consider it in isolation, or as a substitute for analysis of our
operating results as reported under GAAP. Some of these limitations are:
-
EBITDA does not reflect cash expenditures, or future requirements for
capital expenditures, or contractual commitments;
-
EBITDA does not reflect changes in, or cash requirements for, working
capital needs;
-
EBITDA does not reflect the significant interest expense, or the cash
requirements necessary to service interest or principal payments, on
debt or cash income tax payments;
-
Although depreciation and amortization are non-cash charges, the
assets being depreciated and amortized will often have to be replaced
in the future, and EBITDA does not reflect any cash requirements for
such replacements; and
-
Other companies in this industry may calculate EBITDA differently than
Clearway Energy does, limiting its usefulness as a comparative measure.
Because of these limitations, EBITDA should not be considered as a
measure of discretionary cash available to use to invest in the growth
of Clearway Energy’s business. Clearway Energy compensates for these
limitations by relying primarily on our GAAP results and using EBITDA
and Adjusted EBITDA only supplementally. See the statements of cash flow
included in the financial statements that are a part of this news
release.
Adjusted EBITDA is presented as a further supplemental measure of
operating performance. Adjusted EBITDA represents EBITDA adjusted for
mark-to-market gains or losses, non-cash equity compensation expense,
asset write offs and impairments; and factors which we do not consider
indicative of future operating performance such as transition and
integration related costs. The reader is encouraged to evaluate each
adjustment and the reasons Clearway Energy considers it appropriate for
supplemental analysis. As an analytical tool, Adjusted EBITDA is subject
to all of the limitations applicable to EBITDA. In addition, in
evaluating Adjusted EBITDA, the reader should be aware that in the
future Clearway Energy may incur expenses similar to the adjustments in
this news release.
Management believes Adjusted EBITDA is useful to investors and other
users of our financial statements in evaluating our operating
performance because it provides them with an additional tool to compare
business performance across companies and across periods. This measure
is widely used by investors to measure a company’s operating performance
without regard to items such as interest expense, taxes, depreciation
and amortization, which can vary substantially from company to company
depending upon accounting methods and book value of assets, capital
structure and the method by which assets were acquired.
Additionally, Management believes that investors commonly adjust EBITDA
information to eliminate the effect of restructuring and other expenses,
which vary widely from company to company and impair comparability. As
we define it, Adjusted EBITDA represents EBITDA adjusted for the effects
of impairment losses, gains or losses on sales, non-cash equity
compensation expense, dispositions or retirements of assets, any
mark-to-market gains or losses from accounting for derivatives,
adjustments to exclude gains or losses on the repurchase, modification
or extinguishment of debt, and any extraordinary, unusual or
non-recurring items plus adjustments to reflect the Adjusted EBITDA from
our unconsolidated investments. We adjust for these items in our
Adjusted EBITDA as our management believes that these items would
distort their ability to efficiently view and assess our core operating
trends.
In summary, our management uses Adjusted EBITDA as a measure of
operating performance to assist in comparing performance from period to
period on a consistent basis and to readily view operating trends, as a
measure for planning and forecasting overall expectations and for
evaluating actual results against such expectations, and in
communications with our Board of Directors, shareholders, creditors,
analysts and investors concerning our financial performance.
Cash Available for Distribution (CAFD) is Adjusted EBITDA plus cash
distributions/return of investment from unconsolidated affiliates,
adjustments to reflect CAFD generated by unconsolidated investments that
are unable to distribute project dividends due to the PG&E bankruptcy,
cash receipts from notes receivable, cash distributions from
noncontrolling interests, less cash distributions to noncontrolling
interests, maintenance capital expenditures, pro-rata adjusted EBITDA
from unconsolidated affiliates, cash interest paid, income taxes paid,
principal amortization of indebtedness, Walnut Creek investment
payments, changes in prepaid and accrued capacity payments, and adjusted
for development expenses. Management believes CAFD is a relevant
supplemental measure of the Company’s ability to earn and distribute
cash returns to investors.
We believe CAFD is useful to investors in evaluating our operating
performance because securities analysts and other interested parties use
such calculations as a measure of our ability to make quarterly
distributions. In addition, CAFD is used by our management team for
determining future acquisitions and managing our growth. The GAAP
measure most directly comparable to CAFD is cash provided by operating
activities.
However, CAFD has limitations as an analytical tool because it does not
include changes in operating assets and liabilities and excludes the
effect of certain other cash flow items, all of which could have a
material effect on our financial condition and results from operations.
CAFD is a non GAAP measure and should not be considered an alternative
to cash provided by operating activities or any other performance or
liquidity measure determined in accordance with GAAP, nor is it
indicative of funds available to fund our cash needs. In addition, our
calculations of CAFD are not necessarily comparable to CAFD as
calculated by other companies. Investors should not rely on these
measures as a substitute for any GAAP measure, including cash provided
by operating activities.
|
|
|
1 |
|
Includes adjustments to reflect CAFD generated by unconsolidated
investments that are unable to distribute project dividends due to
the PG&E bankruptcy
|
2 |
|
Generation sold excludes MWh that are reimbursable for economic
curtailment
|
3 |
|
5 Year Average over the period 2020-2024
|
4 |
|
5 Year Average over the period 2020-2024
|
5 |
|
Excludes $26 million for 14 MW of residential solar leases acquired
outside of partnerships
|
6 |
|
Based on cash to be distributed; excludes 14 MW of residential solar
leases acquired outside of partnership
|
7 |
|
Primarily relates to Thermal Development Expenses
|
8 |
|
Excludes $18 million of contributions in 2019 related to funding of
Oahu tax equity partnership; Excludes $19 million of contributions
in 2018 related to funding Buckthorn Solar tax equity partnership
|
9 |
|
Net of allocated insurance proceeds
|
10 |
|
Excludes $220 million in 2019 for Convertible Notes
|
11 |
|
Represents reimbursement of network upgrades
|
12 |
|
Distribution from unconsolidated affiliates can be classified as
Return of Investment on Unconsolidated Affiliates when actuals are
reported. This is below cash from operating activities
|
13 |
|
Primarily relates to Thermal Development Expenses
|
14 |
|
Includes tax equity proceeds and distributions to tax equity
partners
|
15 |
|
Excludes $220 million in 2019 for Convertible Notes
|
|
|
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20190507005513/en/
Source: Clearway Energy, Inc.
Investors:
Akil Marsh
investor.relations@clearwayenergy.com
609-608-1500
Media:
Zadie Oleksiw
media@clearwayenergy.com