-
Full year financial performance in-line with expectations
-
Completed new sponsorship with Global Infrastructure Partners (GIP)
as the Company’s controlling shareholder
-
Invested $94 million1 in new accretive
growth investments in 2018
-
Raised $754 million in new corporate level capital for growth
investments and balance sheet management
-
Announced modified capital allocation approach on February 14, 2019
due to Pacific Gas & Electric’s (PG&E) bankruptcy filing
PRINCETON, N.J.--(BUSINESS WIRE)--Feb. 28, 2019--
Clearway Energy, Inc. (NYSE: CWEN, CWEN.A) today reported full year 2018
financial results including Net Income of $54 million, Adjusted EBITDA
of $983 million, Cash from Operating Activities of $498 million, and
Cash Available for Distribution (CAFD) of $291 million.
“In 2018, Clearway Energy began a new era under sponsorship by GIP,
raised $754 million in new capital for growth and balance sheet
management, closed on $94 million of accretive transactions, and met
financial expectations despite weak renewable energy conditions in the
fourth quarter." said Christopher Sotos, Clearway Energy, Inc.’s
President and Chief Executive Officer. “As we move forward into 2019, we
are confident that our recently announced modified capital allocation
approach will allow us to prudently navigate the impacts on the Company
caused by the Pacific Gas and Electric bankruptcy. Additionally, and
under GIP's stewardship, Clearway Group's continued investment in its
development pipeline will over time lead to additional projects placed
into the Company's Right of First Offer pipeline. The addition of Hawaii
Solar Phase II to the ROFO pipeline, as well as the backstop of the
Carlsbad purchase, were the most recent examples of our strong
partnership with Clearway Group and GIP.”
Overview of Financial and Operating Results
Segment Results
|
|
|
|
|
Table 1: Net (Loss)/Income
|
|
|
|
|
|
($ millions)
|
|
Three Months Ended
|
|
Twelve Months Ended
|
Segment
|
|
12/31/18
|
|
12/31/17
|
|
12/31/18
|
|
12/31/17
|
Conventional
|
|
28
|
|
|
33
|
|
|
135
|
|
|
120
|
|
Renewables
|
|
(45
|
)
|
|
(49
|
)
|
|
86
|
|
|
8
|
|
Thermal
|
|
5
|
|
|
3
|
|
|
29
|
|
|
25
|
|
Corporate
|
|
(79
|
)
|
|
(84
|
)
|
|
(196
|
)
|
|
(177
|
)
|
Net (Loss)/Income
|
|
(91
|
)
|
|
(97
|
)
|
|
54
|
|
|
(24
|
)
|
|
|
|
|
|
Table 2: Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
($ millions)
|
|
Three Months Ended
|
|
Twelve Months Ended
|
Segment
|
|
12/31/18
|
|
12/31/17
|
|
12/31/18
|
|
12/31/17
|
Conventional
|
|
77
|
|
|
84
|
|
|
302
|
|
|
305
|
|
Renewables
|
|
110
|
|
|
113
|
|
|
634
|
|
|
589
|
|
Thermal
|
|
14
|
|
|
12
|
|
|
64
|
|
|
58
|
|
Corporate
|
|
(1
|
)
|
|
(4
|
)
|
|
(17
|
)
|
|
(17
|
)
|
Adjusted EBITDA
|
|
200
|
|
|
205
|
|
|
983
|
|
|
935
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 3: Cash from Operating Activities and Cash Available for
Distribution (CAFD)
|
|
|
|
Three Months Ended
|
|
Twelve Months Ended
|
($ millions)
|
|
12/31/18
|
|
12/31/17
|
|
12/31/18
|
|
12/31/17
|
Cash from Operating Activities
|
|
102
|
|
|
144
|
|
|
498
|
|
|
517
|
|
Cash Available for Distribution (CAFD)
|
|
41
|
|
|
60
|
|
|
291
|
|
|
269
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the fourth quarter of 2018, the Company reported a Net Loss of $91
million, Adjusted EBITDA of $200 million, Cash from Operating Activities
of $102 million, and CAFD of $41 million. Adjusted EBITDA results were
lower than 2017 primarily due to outages at the Conventional segment and
weaker renewable energy conditions versus fourth quarter 2017. This was
partially offset by the contribution from growth investments made during
2018 and lower corporate costs. In the fourth quarter, CAFD results were
lower than 2017 primarily due to lower Adjusted EBITDA, additional
maintenance capex in 2018, the timing of insurance proceeds, and the
roll off of network upgrade reimbursements.
For the full year of 2018, the Company reported Net Income of $54
million, Adjusted EBITDA of $983 million, Cash from Operating Activities
of $498 million, and CAFD of $291 million. Adjusted EBITDA results were
higher than 2017 primarily due to growth investments made in 2018 and
higher wind production for the full year relative to 2017. For the full
year, CAFD results were higher than 2017 primarily due to the growth in
Adjusted EBITDA, lower principal amortization at Thermal due to the
refinancing of the Series C notes, and the full year impact of growth
from the November 2017 Drop Down Assets2.
Operational Performance
|
|
|
|
|
Table 4: Selected Operating Results
|
|
|
|
|
|
(MWh and MWht in thousands)
|
|
Three Months Ended
|
|
Twelve Months Ended
|
|
|
12/31/18
|
|
12/31/17
|
|
12/31/18
|
|
12/31/17
|
Equivalent Availability Factor (Conventional)
|
|
97.6
|
%
|
|
98.3
|
%
|
|
94.3
|
%
|
|
93.9
|
%
|
Renewables Generation Sold (MWh)
|
|
1,472
|
|
1,490
|
|
7,197
|
|
6,844
|
Thermal Generation Sold (MWh/MWht)
|
|
479
|
|
484
|
|
2,090
|
|
1,961
|
|
|
|
|
|
|
|
|
|
In the fourth quarter of 2018, availability at the Conventional segment
was lower than the fourth quarter of 2017 due to a forced outage event
at Walnut Creek's Unit 2. The amendment to the comprehensive service
agreement executed in 2017 with the original equipment manufacturer
provided for a portion of cost recovery on this outage.
Additionally, generation in the renewables segment was significantly
below median expectations and 1% lower than the fourth quarter of 2017
primarily due to weak wind conditions. This was partially offset by the
addition of Buckthorn Solar which closed in April 2018.
Liquidity and Capital Resources
Table 5: Liquidity
|
|
|
|
|
|
|
($ millions)
|
|
12/31/18
|
|
9/30/18
|
|
12/31/17
|
Cash and Cash Equivalents:
|
|
|
|
|
|
|
Clearway Energy, Inc. and Clearway Energy LLC, excluding subsidiaries
|
|
$
|
298
|
|
|
$
|
112
|
|
|
$
|
24
|
Subsidiaries
|
|
109
|
|
|
120
|
|
|
124
|
Restricted Cash:
|
|
|
|
|
|
|
Operating accounts
|
|
84
|
|
|
65
|
|
|
25
|
Reserves, including debt service, distributions, performance
obligations and other reserves
|
|
92
|
|
|
92
|
|
|
143
|
Total Cash
|
|
$
|
583
|
|
|
$
|
389
|
|
|
$
|
316
|
Revolving credit facility availability
|
|
$
|
454
|
|
|
$
|
425
|
|
|
$
|
366
|
Total Liquidity
|
|
$
|
1,037
|
|
|
$
|
814
|
|
|
$
|
682
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liquidity as of December 31, 2018, was $1,037 million, $355
million higher relative to December 31, 2017. This increase was
primarily driven by higher total cash balances of $267 million primarily
from the issuance of the 2025 Senior Notes partially offset by the
tendered 2019 and 2020 convertible notes from the Fundamental Change
Tender Offer. Borrowing capacity under the revolving credit facility
also increased by $88 million due the repayment of outstanding balances
and lower letter of credit postings.
The Company's liquidity includes $176 million of restricted cash
balances as of December 31, 2018. 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 December 31, 2018, these restricted funds were comprised of $84
million designated to fund operating expenses, approximately $26 million
designated for current debt service payments, and $32 million of
reserves for debt service, performance obligations and other items
including capital expenditures. The remaining $34 million is held in
distribution accounts, of which $31 million related to subsidiaries
affected by the PG&E bankruptcy.
In the first quarter of 2019 the Company used approximately $239 million
of cash to repay the remaining $220 million of 2019 Convertible notes at
maturity and for $19 million buy out of the Wind TE HoldCo tax equity
partnership as described below.
Potential future sources of liquidity include excess operating cash
flow, the existing $150 million ATM program, of which $36 million
remained available as of February 28, 2019, availability under the
revolving credit facility, and, subject to market conditions, new
corporate financings.
PG&E Bankruptcy Update
On January 29, 2019, Pacific Gas and Electric Company filed for
reorganization under Chapter 11 of the U.S. Bankruptcy Code. The Company
either owns or invests in 1,200 net MW of electric generation projects
with long-term supply or capacity contracts with PG&E. As of December
31, 2018, the Company’s balance sheet included approximately $1.4
billion of non-recourse debt associated with these projects.
Additionally, these projects represent approximately $90 million3
of potential exposure to 2019 project level CAFD. The PG&E bankruptcy
filing has triggered defaults under the power purchase agreements with
PG&E and related project level financing agreements. While the Company
is actively working with project level lenders on forbearance
agreements, 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, could result in the
Company accumulating less unrestricted cash and thus decrease the
Company’s corporate liquidity and cash available for shareholder
dividends and growth investments.
As of February 27, 2019, PG&E has neither assumed, rejected, or sought
to renegotiate contracts.
Growth Investments
Carlsbad Energy Center: Exercised the Backstop with GIP
The Company exercised the equity backstop with GIP for the acquisition
of the Carlsbad Energy Center. On February 27, 2019, after considering
final purchase price adjustments, GIP acquired Carlsbad from NRG for
$387 million, excluding working capital. Pursuant to the terms
previously agreed by and between the Company and GIP, the Company
maintains the option for a period of eighteen (18) months to acquire
Carlsbad from GIP at the same terms and conditions previously negotiated
with NRG. Should the Company not acquire Carlsbad during such eighteen
months, Carlsbad will become a Clearway Group ROFO Asset.
Interest in Agua Caliente: Forgoing the Drop Down Offer from NRG
Energy, Inc.
On November 1, 2018, NRG offered the Company the opportunity to acquire
Agua Caliente Borrower 1 LLC, which owns a 35% interest in Agua
Caliente, a 290 MW utility-scale solar project located in Dateland,
Arizona with PG&E as the project’s customer. The Company has elected to
forgo the acquisition. The Company continues to own a 16% interest in
the project through Agua Caliente Borrower 2 LLC.
Update to the ROFO Pipeline with Clearway Group
On February 14, 2019, the Company entered into a First Amendment to the
Right of First Offer Agreement with Clearway Group to add Hawaii Solar
Phase II, the first addition to the ROFO pipeline since the closing of
the GIP Transaction. Hawaii Solar Phase II consists of two solar and
storage projects located in Oahu, Hawaii with a combined capacity of
75MW. The Mililani I Solar project, located in the Mililani Agricultural
Park, is sized at 39 MW and will include battery storage capability. The
Waiawa Solar Power project, located in the Waiawa region, is sized at 36
MW and will also include battery storage capability. Subject to approval
by the Hawaii Public Utilities Commission (PUC) both projects will sell
power to Hawaii Electric under 20-year PPAs. The expected commercial
operation date for these projects is currently estimated in 2021.
Repowering Partnership with Clearway Group
On September 11, 2018, the Company entered into a repowering partnership
with Clearway Group for 283 MW of wind assets (Wildorado and Elbow
Creek). To facilitate this new partnership, the Company agreed to buy
out the existing Wind TE Holdco tax equity partner for $19 million,
subject to purchase price adjustments. In January 2019, the Company
completed the transaction with the tax equity partner for $19 million.
The Company expects to provide further updates with respect to the
Repowering Partnership during 2019.
Corporate Liability Management Update
In October 2018 the Company issued $600 million of 2025 Senior Notes. A
portion of these proceeds was used to fund the repurchase of $352
million of the 2019 and 2020 Convertible Notes tendered as part of the
Fundamental Change Tender Offer.
In the first quarter of 2019 the Company repaid the remaining $220
million of 2019 Convertible Notes at maturity 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 February 12, 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 March 15, 2019, to stockholders of record as
of March 1, 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; and
-
Timing of maintenance capital expenditures and the impact of both
unforced and forced outages.
The Company takes into consideration the timing of these factors to
ensure sufficient funds are available for distribution and operating
activities on a quarterly basis.
2019 Financial Guidance
As previously updated on February 14, 2019, the Company's 2019 CAFD
guidance is $270 million. This financial guidance reflects no additional
corporate level financing and assumes that all CAFD related to the
projects impacted by the PG&E Bankruptcy is realized in 2019. Financial
guidance for 2019 continues to be based on median renewable energy
production estimates.
Earnings Conference Call
On February 28, 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 (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 our 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, effects 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, our ability to access capital
markets, cyber terrorism and inadequate cybersecurity, the ability to
engage in successful acquisitions activity, unanticipated outages at our
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),
our ability to enter into new contracts as existing contracts expire,
risk relating to the Company's relationships with GIP and Clearway
Energy Group, our ability to acquire assets from GIP, Clearway Energy
Group or third parties, our ability to close drop down transactions, and
our ability to maintain and grow our 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, February 28, 2019, and
are based on assumptions believed to be reasonable as of this date.
Clearway Energy expressly disclaims any current intention to update such
guidance. The foregoing review of factors that could cause Clearway
Energy’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’s future results included
in Clearway Energy’s filings with the Securities and Exchange Commission
at www.sec.gov.
In addition, Clearway Energy 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
|
|
|
|
|
|
Year ended December 31,
|
(In millions, except per share amounts)
|
|
2018
|
|
2017
|
|
2016
|
Operating Revenues
|
|
|
|
|
|
|
Total operating revenues
|
|
$
|
1,053
|
|
|
$
|
1,009
|
|
|
$
|
1,035
|
|
Operating Costs and Expenses
|
|
|
|
|
|
|
Cost of operations
|
|
332
|
|
|
326
|
|
|
308
|
|
Depreciation and amortization
|
|
331
|
|
|
334
|
|
|
303
|
|
Impairment losses
|
|
—
|
|
|
44
|
|
|
185
|
|
General and administrative
|
|
20
|
|
|
19
|
|
|
16
|
|
Acquisition-related transaction and integration costs
|
|
20
|
|
|
3
|
|
|
1
|
|
Development costs
|
|
3
|
|
|
—
|
|
|
—
|
|
Total operating costs and expenses
|
|
706
|
|
|
726
|
|
|
813
|
|
Operating Income
|
|
347
|
|
|
283
|
|
|
222
|
|
Other Income (Expense)
|
|
|
|
|
|
|
Equity in earnings of unconsolidated affiliates
|
|
74
|
|
|
71
|
|
|
60
|
|
Other income, net
|
|
8
|
|
|
4
|
|
|
3
|
|
Loss on debt extinguishment
|
|
(7
|
)
|
|
(3
|
)
|
|
—
|
|
Interest expense
|
|
(306
|
)
|
|
(307
|
)
|
|
(284
|
)
|
Total other expense, net
|
|
(231
|
)
|
|
(235
|
)
|
|
(221
|
)
|
Income Before Income Taxes
|
|
116
|
|
|
48
|
|
|
1
|
|
Income tax expense (benefit)
|
|
62
|
|
|
72
|
|
|
(1
|
)
|
Net Income (Loss)
|
|
54
|
|
|
(24
|
)
|
|
2
|
|
Less: Pre-acquisition net income (loss) of Drop Down Assets
|
|
4
|
|
|
7
|
|
|
(4
|
)
|
Net Income (Loss) Excluding Pre-acquisition Net Income (Loss)
of Drop Down Assets
|
|
50
|
|
|
(31
|
)
|
|
6
|
|
Less: Net income (loss) attributable to noncontrolling interests
|
|
2
|
|
|
(15
|
)
|
|
(51
|
)
|
Net Income (Loss) Attributable to Clearway Energy, Inc.
|
|
$
|
48
|
|
|
$
|
(16
|
)
|
|
$
|
57
|
|
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
|
|
|
35
|
|
Weighted average number of Class C common shares outstanding - basic
and diluted
|
|
69
|
|
|
64
|
|
|
63
|
|
Earnings (Loss) per Weighted Average Class A and Class C Common
Share - Basic and Diluted
|
|
$
|
0.46
|
|
|
$
|
(0.16
|
)
|
|
$
|
0.58
|
|
Dividends Per Class A Common Share
|
|
1.258
|
|
|
1.098
|
|
|
$
|
0.945
|
|
Dividends Per Class C Common Share
|
|
$
|
1.258
|
|
|
$
|
1.098
|
|
|
$
|
0.945
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CLEARWAY ENERGY, INC.
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
|
|
|
|
|
Year ended December 31,
|
(In millions)
|
|
2018
|
|
2017
|
|
2016
|
Net Income (Loss)
|
|
$
|
54
|
|
|
$
|
(24
|
)
|
|
$
|
2
|
|
Other Comprehensive Income (Loss), net of tax
|
|
|
|
|
|
|
Unrealized gain on derivatives, net of income tax expense of $2, $7,
and $0
|
|
22
|
|
|
10
|
|
|
13
|
|
Other comprehensive income
|
|
22
|
|
|
10
|
|
|
13
|
|
Comprehensive Income (Loss)
|
|
76
|
|
|
(14
|
)
|
|
15
|
|
Less: Pre-acquisition net income (loss) of Drop Down Assets
|
|
4
|
|
|
7
|
|
|
(4
|
)
|
Less: Comprehensive income (loss) attributable to noncontrolling
interests
|
|
14
|
|
|
(5
|
)
|
|
(37
|
)
|
Comprehensive Income (Loss) Attributable to Clearway Energy, Inc.
|
|
$
|
58
|
|
|
$
|
(16
|
)
|
|
$
|
56
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CLEARWAY ENERGY, INC.
|
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
|
(In millions, except shares)
|
|
December 31, 2018
|
|
December 31, 2017
|
ASSETS
|
|
|
|
|
Current Assets
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
407
|
|
|
$
|
148
|
|
Restricted cash
|
|
176
|
|
|
168
|
|
Accounts receivable — trade
|
|
104
|
|
|
95
|
|
Inventory
|
|
40
|
|
|
39
|
|
Notes receivable — current
|
|
—
|
|
|
13
|
|
Prepayments and other current assets
|
|
29
|
|
|
19
|
|
Total current assets
|
|
756
|
|
|
482
|
|
Property, plant and equipment, net
|
|
5,245
|
|
|
5,410
|
|
Other Assets
|
|
|
|
|
Equity investments in affiliates
|
|
1,172
|
|
|
1,178
|
|
Intangible assets, net
|
|
1,156
|
|
|
1,228
|
|
Derivative instruments
|
|
8
|
|
|
1
|
|
Deferred income taxes
|
|
57
|
|
|
128
|
|
Other non-current assets
|
|
106
|
|
|
62
|
|
Total other assets
|
|
2,499
|
|
|
2,597
|
|
Total Assets
|
|
$
|
8,500
|
|
|
$
|
8,489
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
Current Liabilities
|
|
|
|
|
Current portion of long-term debt
|
|
$
|
535
|
|
|
$
|
339
|
|
Accounts payable — trade
|
|
45
|
|
|
46
|
|
Accounts payable — affiliate
|
|
19
|
|
|
49
|
|
Derivative instruments
|
|
4
|
|
|
18
|
|
Accrued interest expense
|
|
44
|
|
|
38
|
|
Accrued expenses and other current liabilities
|
|
57
|
|
|
50
|
|
Total current liabilities
|
|
704
|
|
|
540
|
|
Other Liabilities
|
|
|
|
|
Long-term debt
|
|
5,447
|
|
|
5,659
|
|
Derivative instruments
|
|
17
|
|
|
31
|
|
Other non-current liabilities
|
|
108
|
|
|
100
|
|
Total non-current liabilities
|
|
5,572
|
|
|
5,790
|
|
Total Liabilities
|
|
6,276
|
|
|
6,330
|
|
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); 193,251,396 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 and 184,780,837 shares
issued and outstanding (Class A 34,586,250, Class B 42,738,750, Class
C 64,717,087, Class D 42,738,750) at December 31, 2017
|
|
1
|
|
|
1
|
|
Additional paid-in capital
|
|
1,897
|
|
|
1,843
|
|
Accumulated deficit
|
|
(58
|
)
|
|
(69
|
)
|
Accumulated other comprehensive loss
|
|
(18
|
)
|
|
(28
|
)
|
Noncontrolling interest
|
|
402
|
|
|
412
|
|
Total Stockholders' Equity
|
|
2,224
|
|
|
2,159
|
|
Total Liabilities and Stockholders' Equity
|
|
$
|
8,500
|
|
|
$
|
8,489
|
|
|
|
|
|
|
|
|
|
|
|
CLEARWAY ENERGY, INC.
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
Year ended December 31,
|
|
|
2018
|
|
2017
|
|
2016
|
Cash Flows from Operating Activities
|
|
(In millions)
|
Net income (loss)
|
|
$
|
54
|
|
|
$
|
(24
|
)
|
|
$
|
2
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
|
|
Equity in earnings of unconsolidated affiliates
|
|
(74
|
)
|
|
(71
|
)
|
|
(60
|
)
|
Distributions from unconsolidated affiliates
|
|
70
|
|
|
72
|
|
|
58
|
|
Depreciation and amortization
|
|
331
|
|
|
334
|
|
|
303
|
|
Amortization of financing costs and debt discounts
|
|
24
|
|
|
25
|
|
|
20
|
|
Amortization of intangibles and out-of-market contracts
|
|
70
|
|
|
70
|
|
|
76
|
|
Loss on debt extinguishment
|
|
7
|
|
|
3
|
|
|
—
|
|
Change in deferred income taxes
|
|
62
|
|
|
72
|
|
|
(1
|
)
|
Impairment losses
|
|
—
|
|
|
44
|
|
|
185
|
|
Changes in derivative instruments
|
|
(16
|
)
|
|
(15
|
)
|
|
(15
|
)
|
(Gain) loss on disposal of asset components
|
|
—
|
|
|
16
|
|
|
6
|
|
Cash provided by (used in) changes in other working capital:
|
|
|
|
|
|
|
Changes in prepaid and accrued capacity payments
|
|
—
|
|
|
(4
|
)
|
|
(8
|
)
|
Changes in other working capital
|
|
(30
|
)
|
|
(5
|
)
|
|
11
|
|
Net Cash Provided by Operating Activities
|
|
498
|
|
|
517
|
|
|
577
|
|
Cash Flows from Investing Activities
|
|
|
|
|
|
|
Acquisition of business
|
|
(11
|
)
|
|
—
|
|
|
—
|
|
Acquisition of Drop Down Assets, net of cash acquired
|
|
(126
|
)
|
|
(250
|
)
|
|
(77
|
)
|
Capital expenditures
|
|
(83
|
)
|
|
(190
|
)
|
|
(20
|
)
|
Cash receipts from notes receivable
|
|
13
|
|
|
17
|
|
|
17
|
|
Return of investment from unconsolidated affiliates
|
|
45
|
|
|
47
|
|
|
28
|
|
Investments in unconsolidated affiliates
|
|
(34
|
)
|
|
(73
|
)
|
|
(83
|
)
|
Other
|
|
11
|
|
|
7
|
|
|
4
|
|
Net Cash Used in Investing Activities
|
|
(185
|
)
|
|
(442
|
)
|
|
(131
|
)
|
Cash Flows from Financing Activities
|
|
|
|
|
|
|
Net contributions from noncontrolling interests
|
|
91
|
|
|
13
|
|
|
5
|
|
Net distributions and return of capital to NRG prior to the
acquisition of Drop Down Assets
|
|
—
|
|
|
(23
|
)
|
|
(184
|
)
|
Proceeds from the issuance of common stock
|
|
153
|
|
|
34
|
|
|
—
|
|
Payments of dividends and distributions
|
|
(238
|
)
|
|
(202
|
)
|
|
(173
|
)
|
Proceeds from the revolving credit facility
|
|
35
|
|
|
55
|
|
|
60
|
|
Payments for the revolving credit facility
|
|
(90
|
)
|
|
—
|
|
|
(366
|
)
|
Proceeds from issuance of long-term debt
|
|
827
|
|
|
210
|
|
|
740
|
|
Payments of debt issuance costs
|
|
(14
|
)
|
|
(12
|
)
|
|
(15
|
)
|
Payments for long-term debt
|
|
(810
|
)
|
|
(332
|
)
|
|
(269
|
)
|
Net Cash Used in Financing Activities
|
|
(46
|
)
|
|
(257
|
)
|
|
(202
|
)
|
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted
Cash
|
|
267
|
|
|
(182
|
)
|
|
244
|
|
Cash, Cash Equivalents and Restricted Cash at Beginning of Period
|
|
316
|
|
|
498
|
|
|
254
|
|
Cash, Cash Equivalents and Restricted Cash at End of Period
|
|
$
|
583
|
|
|
$
|
316
|
|
|
$
|
498
|
|
|
|
|
|
|
|
|
Supplemental Disclosures
|
|
|
|
|
|
|
Interest paid, net of amount capitalized
|
|
$
|
(292
|
)
|
|
$
|
(297
|
)
|
|
$
|
(271
|
)
|
Non-cash investing and financing activities:
|
|
|
|
|
|
|
(Reductions) Additions to fixed assets for accrued capital
expenditures
|
|
(15
|
)
|
|
22
|
|
|
3
|
|
Non-cash adjustment for change in tax basis of assets
|
|
(7
|
)
|
|
(20
|
)
|
|
44
|
|
Non-cash contributions from CEG, NRG, net of distributions
|
|
$
|
38
|
|
|
$
|
(2
|
)
|
|
$
|
90
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Appendix Table A-1: Three Months Ended December 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 (Loss) Income
|
|
$
|
28
|
|
|
$
|
(45
|
)
|
|
$
|
5
|
|
|
$
|
(79
|
)
|
|
$
|
(91
|
)
|
Plus:
|
|
|
|
|
|
|
|
|
|
|
Income Tax Expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
45
|
|
|
45
|
|
Interest Expense, net
|
|
18
|
|
|
58
|
|
|
4
|
|
|
24
|
|
|
104
|
|
Depreciation, Amortization, and ARO
|
|
26
|
|
|
53
|
|
|
6
|
|
|
—
|
|
|
85
|
|
Contract Amortization
|
|
1
|
|
|
16
|
|
|
1
|
|
|
—
|
|
|
18
|
|
Loss on Debt Extinguishment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
|
Acquisition-related transaction and integration costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
Other non-recurring charges
|
|
1
|
|
|
2
|
|
|
(2
|
)
|
|
—
|
|
|
1
|
|
Adjustments to reflect CWEN’s pro-rata share of Adjusted
EBITDA from Unconsolidated Affiliates
|
|
3
|
|
|
26
|
|
|
—
|
|
|
—
|
|
|
29
|
|
Non-Cash Equity Compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
Adjusted EBITDA
|
|
$
|
77
|
|
|
$
|
110
|
|
|
$
|
14
|
|
|
$
|
(1
|
)
|
|
$
|
200
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Appendix Table A-2: Three Months Ended December 31, 2017, 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
|
|
$
|
33
|
|
|
$
|
(49
|
)
|
|
$
|
3
|
|
|
$
|
(84
|
)
|
|
$
|
(97
|
)
|
Plus:
|
|
|
|
|
|
|
|
|
|
|
Income Tax Expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
57
|
|
|
57
|
|
Interest Expense, net
|
|
9
|
|
|
34
|
|
|
3
|
|
|
21
|
|
|
67
|
|
Depreciation, Amortization, and ARO
|
|
27
|
|
|
56
|
|
|
6
|
|
|
—
|
|
|
89
|
|
Contract Amortization
|
|
1
|
|
|
16
|
|
|
—
|
|
|
—
|
|
|
17
|
|
Impairment Losses
|
|
—
|
|
|
32
|
|
|
—
|
|
|
—
|
|
|
32
|
|
Loss on Debt Extinguishment
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
Acquisition-related transaction and integration costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
Other non-recurring charges
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
Adjustments to reflect CWEN’s pro-rata share of Adjusted
EBITDA from Unconsolidated Affiliates
|
|
4
|
|
|
23
|
|
|
—
|
|
|
—
|
|
|
27
|
|
Non-Cash Equity Compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
Adjusted EBITDA
|
|
$
|
84
|
|
|
$
|
113
|
|
|
$
|
12
|
|
|
$
|
(4
|
)
|
|
$
|
205
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Appendix Table A-3: Twelve Months Ended December 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)
|
|
$
|
135
|
|
|
$
|
86
|
|
|
$
|
29
|
|
|
$
|
(196
|
)
|
|
$
|
54
|
Plus:
|
|
|
|
|
|
|
|
|
|
|
Income Tax Expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
62
|
|
|
62
|
Interest Expense, net
|
|
50
|
|
|
152
|
|
|
12
|
|
|
87
|
|
|
301
|
Depreciation, Amortization, and ARO
|
|
102
|
|
|
210
|
|
|
23
|
|
|
—
|
|
|
335
|
Contract Amortization
|
|
5
|
|
|
62
|
|
|
3
|
|
|
—
|
|
|
70
|
Loss on Debt Extinguishment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
7
|
Acquisition-related transaction and integration costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20
|
|
|
20
|
Other non-recurring charges
|
|
(3
|
)
|
|
6
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
Adjustments to reflect CWEN’s pro-rata share of Adjusted
EBITDA from Unconsolidated Affiliates
|
|
13
|
|
|
118
|
|
|
—
|
|
|
—
|
|
|
131
|
Non-Cash Equity Compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
Adjusted EBITDA
|
|
$
|
302
|
|
|
$
|
634
|
|
|
$
|
64
|
|
|
$
|
(17
|
)
|
|
$
|
983
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Appendix Table A-4: Twelve Months Ended December 31, 2017, 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
|
|
$
|
120
|
|
|
$
|
8
|
|
|
$
|
25
|
|
|
$
|
(177
|
)
|
|
$
|
(24
|
)
|
Plus:
|
|
|
|
|
|
|
|
|
|
|
Income Tax Expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
72
|
|
|
72
|
|
Interest Expense, net
|
|
48
|
|
|
163
|
|
|
10
|
|
|
83
|
|
|
304
|
|
Depreciation, Amortization, and ARO
|
|
104
|
|
|
213
|
|
|
21
|
|
|
—
|
|
|
338
|
|
Contract Amortization
|
|
5
|
|
|
62
|
|
|
2
|
|
|
—
|
|
|
69
|
|
Impairment Losses
|
|
—
|
|
|
44
|
|
|
—
|
|
|
—
|
|
|
44
|
|
Loss on Debt Extinguishment
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
Acquisition-related transaction and integration costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
3
|
|
Other non-recurring charges
|
|
14
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
18
|
|
Adjustments to reflect CWEN’s pro-rata share of Adjusted
EBITDA from Unconsolidated Affiliates
|
|
14
|
|
|
92
|
|
|
—
|
|
|
—
|
|
|
106
|
|
Non-Cash Equity Compensation
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
2
|
|
Adjusted EBITDA
|
|
$
|
305
|
|
|
$
|
589
|
|
|
$
|
58
|
|
|
$
|
(17
|
)
|
|
$
|
935
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Appendix Table A-5: 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
|
|
Twelve Months Ended
|
($ in millions)
|
|
12/31/18
|
|
12/31/17
|
|
12/31/18
|
|
12/31/17
|
Adjusted EBITDA
|
|
$
|
200
|
|
|
$
|
205
|
|
|
$
|
983
|
|
|
$
|
935
|
|
Cash interest paid
|
|
(68
|
)
|
|
(68
|
)
|
|
(292
|
)
|
|
(297
|
)
|
Changes in prepaid and accrued liabilities for tolling agreements
|
|
(8
|
)
|
|
(9
|
)
|
|
—
|
|
|
(4
|
)
|
Adjustment to reflect Walnut Creek investment payments
|
|
—
|
|
|
(2
|
)
|
|
(1
|
)
|
|
(2
|
)
|
Pro-rata Adjusted EBITDA from unconsolidated affiliates
|
|
(41
|
)
|
|
(35
|
)
|
|
(207
|
)
|
|
(177
|
)
|
Distributions from unconsolidated affiliates
|
|
12
|
|
|
20
|
|
|
70
|
|
|
69
|
|
Changes in working capital and other
|
|
7
|
|
|
33
|
|
|
(55
|
)
|
|
(7
|
)
|
Cash from Operating Activities
|
|
102
|
|
|
144
|
|
|
498
|
|
|
517
|
|
Changes in working capital and other
|
|
(7
|
)
|
|
(33
|
)
|
|
55
|
|
|
7
|
|
Development Expenses
|
|
2
|
|
|
—
|
|
|
3
|
|
|
—
|
|
Return of investment from unconsolidated affiliates
|
|
23
|
|
|
15
|
|
|
45
|
|
|
47
|
|
Net contributions from/(to) non-controlling interest4
|
|
(1
|
)
|
|
(2
|
)
|
|
7
|
|
|
3
|
|
Maintenance capital expenditures5
|
|
(7
|
)
|
|
(1
|
)
|
|
(31
|
)
|
|
(22
|
)
|
Principal amortization of indebtedness6
|
|
(74
|
)
|
|
(69
|
)
|
|
(299
|
)
|
|
(295
|
)
|
Cash receipts from notes receivable7
|
|
3
|
|
|
6
|
|
|
13
|
|
|
17
|
|
Cash Available for Distribution (Recast)
|
|
41
|
|
|
60
|
|
|
291
|
|
|
274
|
|
Adjustment to reflect CWEN's CAFD pre Drop Down acquisition8
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5
|
)
|
Cash Available for Distribution
|
|
$
|
41
|
|
|
$
|
60
|
|
|
$
|
291
|
|
|
$
|
269
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Appendix Table A-6: Twelve Months Ended December 31, 2018, Sources
and Uses of Liquidity
The following table summarizes the sources and uses of liquidity in 2018:
|
|
|
|
|
Twelve Months Ended
|
($ in millions)
|
|
12/31/18
|
Sources:
|
|
|
Proceeds from the issuance of long-term debt
|
|
827
|
|
Net cash provided by operating activities
|
|
498
|
|
Proceeds from the issuance of common stock
|
|
153
|
|
Net contributions from noncontrolling interests
|
|
91
|
|
Return of investment from unconsolidated affiliates
|
|
45
|
|
Proceeds from the revolving credit facility
|
|
35
|
|
|
|
|
Uses:
|
|
|
Payments for long-term debt
|
|
(810
|
)
|
Payment of dividends and distributions
|
|
(238
|
)
|
Payments for the Drop Down Assets
|
|
(126
|
)
|
Payments for the revolving credit facility
|
|
(90
|
)
|
Capital expenditures
|
|
(83
|
)
|
Investments in unconsolidated affiliates
|
|
(34
|
)
|
Other net cash outflows
|
|
(1
|
)
|
|
|
|
Change in total cash, cash equivalents, and restricted cash
|
|
$
|
267
|
|
|
|
|
|
|
Appendix Table A-7: 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 affiliates9
|
|
130
|
|
Cash from Operating Activities
|
|
613
|
|
Development Expense
|
|
4
|
|
Net contributions from non-controlling interest
|
|
(4
|
)
|
Maintenance capital expenditures
|
|
(30
|
)
|
Principal amortization of indebtedness
|
|
(313
|
)
|
Cash receipts from notes receivable
|
|
—
|
|
Cash Available for Distribution
|
|
270
|
|
Add Back: Principal amortization of indebtedness
|
|
313
|
|
Adjusted Cash from Operations
|
|
$
|
583
|
|
|
|
|
|
|
Appendix Table A-8: PG&E Related CAFD
|
|
|
($ in millions)
|
|
2019E CAFD Total Potential Exposure
|
Net Income
|
|
$
|
105
|
|
Interest Expense, net
|
|
55
|
|
Depreciation, Amortization, and ARO Expense
|
|
70
|
|
Adjustment to reflect CWEN share of Adjusted EBITDA in unconsolidated
affiliates
|
|
50
|
|
Adjusted EBITDA
|
|
280
|
|
Cash interest paid
|
|
(53
|
)
|
Pro-rata Adjusted EBITDA from unconsolidated affiliates
|
|
(73
|
)
|
Cash distributions from unconsolidated affiliates
|
|
35
|
|
Cash from Operating Activities
|
|
189
|
|
Principal amortization of indebtedness
|
|
(99
|
)
|
Estimated Cash Available for Distribution
|
|
90
|
|
|
|
|
|
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, 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 Buckthorn Solar ($42 MM), UPMC ($7 MM), Tulare ($11 MM),
and DG Partnerships ($34 MM); net of project level financings
|
2 |
|
November 2017 Drop Down Assets: a 38 MW portfolio of distributed and
small utility-scale solar assets
|
3 |
|
See Appendix Table A-8 of this news release, potential exposure
includes Desert Sunlight 250 (contracted with Southern California
Edison) due to provisions in the financing agreements with Desert
Sunlight 300 (contracted with Pacific Gas & Electric)
|
4 |
|
Excludes $99 million of contributions in 2018 related to funding of
Buckthorn Solar tax equity partnership
|
5 |
|
Net of allocated insurance proceeds
|
6 |
|
Excludes $7 million in Q4 2017 and $37 million in 2017 for SPP
discretionary debt retirements made by NRG as reflected in the
financial statements due to common control; Excludes $61 million in
2018 for Buckthorn Solar debt term conversion, $83 million for
Thermal Series C Notes and $367 million in Q4 2018 and 2018 for
Convertible Note Tender Offers in connection with the GIP
transaction;
|
7 |
|
Cash receipts from notes receivable: reimbursement of network
upgrades
|
8 |
|
Adjustments to reflect drop down assets prior to ownership by
Clearway Energy
|
9 |
|
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
|
|
|
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20190228005406/en/
Source: Clearway Energy, Inc.
Investors:
Akil Marsh
akil.marsh@clearwayenergy.com
609-608-1500
Media:
Ray Long
media@clearwayenergy.com