A Remarkable Year for Boralex in 2020
Press Release
Highlights
- Strong growth in discretionary cash flow and combined EBITDA(A) in 2020
- Cash flow totaling $146 million in 2020 and $67 million in Q4 2020, a 22% increase for the fiscal year and a 2% decrease in the fourth quarter compared to corresponding periods in 2019
- Combined EBITDA(A) of $513 million in 2020 and $155 million in Q4 2020, a 4% increase for the fiscal year and a 6% decrease in the fourth quarter compared to corresponding periods in 2019
- Total combined production above 2019 production and anticipated production1
- For the fiscal year 2020: 5% increase over 2019 and 4% higher than anticipated production
- For the fourth quarter: 5% increase over 2019 and 7% higher than anticipated production
- Two major acquisitions added 17% (354 MW) to installed capacity and 13% ($66 million) to the annualized combined EBITDA(A)
- Closing of the acquisition of CDPQ’s 49% equity stake in 3 Quebec wind farms at the beginning of December 2020
- Closing of the acquisition of interests in seven solar plants in the United States at the beginning of February 2021
- Project portfolio and Growth Path progressed in North America and Europe
- Three wind projects commissioned in France, adding 45 MW during the fourth quarter of 2020
- 139 MW added to the solar project portfolio during the fourth quarter of 2020; 80 MW in the United States and 59 MW in France
- The 200 MW Apuiat wind project (100 MW attributable to Boralex) in Québec and the 200 MW solar projects in the United States advanced to the secured phase of the Growth Path following signature of contracts at the beginning of 2021
- Patrick Decostre took office as President and CEO, effective December 1, 2020, with the retirement of Patrick Lemaire
- First Corporate Social Responsibility (CSR) report published separately from the 2020 Annual Report
Montréal, February 25, 2021 – For the fiscal year ended December 31, 2020, Boralex Inc. (“Boralex” or the “Company”) (TSX: BLX) posted energy sales of $619 million ($738 million2), an increase of 10% (7%) over the fiscal year 2019, and EBITDA(A) of $434 million ($513 million), an increase of 8% (4%) over 2019. For the fourth quarter of 2020, Boralex posted energy sales of $193 million ($225 million), up 8% (6%) over the fourth quarter of 2019. The Company’s EBITDA(A) was $137M ($155M), a level comparable to 2019 excluding a gain on the sale of land in Scotland and other unusual items recorded in the fourth quarter of 2019.
“I’m very proud of our employees’ hard work during the unusual fiscal year in 2020. The 22% growth in our discretionary cash flows, the announcement of two major acquisitions and the addition of many projects to our Growth Path are perfectly aligned with our strategic plan and financial objectives for 2023,” said Boralex’s President and CEO, Patrick Decostre.
“The fiscal year 2020 also marks the beginning of a major project that will highlight our social responsibility business practices and approach to improving these practices.”
The social responsibility (CSR) and ESG criteria sections were added to the Company’s strategic plan during the third quarter of fiscal 2020. A detailed report was produced and is now available on Boralex’s website.
Regarding the Corporation’s outlook, Mr. Decostre added: “We continue to be very active in pursuing development and growth opportunities in our target markets, particularly in North America. We’re also seeing encouraging signs of a resumption of wind energy development in Québec following a 30-year electricity sale contract signed for the Apuiat project, which has an installed capacity of 200 MW, to be developed in collaboration with Innu communities in Québec. The Hydro-Québec Electricity Supply Plan published in October 2020 forecasting to take steps within the next year to acquire new energy supplies, as well as the Québec Government Plan for a Green Economy, released shortly after, are positive elements for the wind energy development on Québec’s territory.”
“Over the next two quarters, we’ll work to update our strategic plan to take into account greater opportunities arising from the energy transition’s acceleration following the publication of stimulus plans by various governments around the world. This review will feature an update of our 2023 financial objectives, given our strong performance over the past two years,” said Mr. Decostre.
- The figures in brackets reflect the combined EBITDA(A), versus those calculated according to the IFRS. See the “Combined EBITDA(A) — Non-IFRS Measures” section below.
| Fourth quarter highlights | |||||||||
| For quarters ended December 31 | |||||||||
| IFRS | Combined(1) | ||||||||
| (in millions of Canadian dollars, unless otherwise | 2020 | 2019 | Change | 2020 | 2019 | Change | |||
| specified) | $ | % | $ | % | |||||
| Power production (GWh)(2) | 1,468 | 1,364 | 104 | 8 | 1,763 | 1,677 | 86 | 5 | |
| Revenues from energy sales and | 193 | 179 | 14 | 8 | 225 | 212 | 13 | 6 | |
| feed-in premium | |||||||||
| EBITDA(A)(1) | 137 | 143 | (6) | (4) | 155 | 165 | (10) | (6) | |
| Net earnings (loss) | 30 | (23) | 53 | >100 | 36 | (15) | 51 | >100 | |
| Net earnings (loss) attributable to | 25 | (26) | 51 | >100 | 31 | (18) | 49 | >100 | |
| shareholders of Boralex | |||||||||
| Per share – basic and diluted | $0.24 | ($0.28) | $0.52 | >100 | $0.30 | ($0.19) | $0.49 | >100 | |
| Net cash flows related to operating | |||||||||
| activities | 59 | 58 | 1 | 3 | 81 | 52 | 29 | 51 | |
| Cash flows from operations(1) | 101 | 119 | (18) | (16) | 118 | 116 | 2 | 2 | |
| Three-month periods ended | Twelve-month periods ended | ||||||||||||
| (in millions of Canadian dollars, unless otherwise | December 31, | December 31, | Change | December 31, | December 31, | Change | |||||||
| 2020 | 2019 | 2020 | 2019 | ||||||||||
| specified) | $ | % | $ | % | |||||||||
| Discretionary cash flows(1) – IFRS | 67 | 68 | (1) | (2) | 146 | 120 | 26 | 22 | |||||
- For more details, see the Non-IFRS Measures section in the 2020 Annual Report available on the websites of Boralex (boralex.com) and SEDAR (sedar.com).
- The production level for which NRWF wind farm was compensated following power generation limitations imposed by the IESO were included in power production, as management uses this measure to evaluate the Corporation’s performance. This change facilitates the correlation between power production and revenues from energy sales and feed-in premium.
In Q4 2020, Boralex generated 1,468 GWh (1,763 GWh) of power, an increase of 8% (5%) compared to 1,364 GWh (1,677 GWh) in the same quarter in 2019. The increase stems from more favorable conditions for Canada’s wind and hydroelectric sectors, as well as the acquisition of the CDPQ’s equity interests in three wind farms in Québec. Canadian wind power generation was 34% (16%) higher than in the fourth quarter of 2019 and 27% (14%) higher than anticipated. Wind power production in France was comparable to the production in the fourth quarter of 2019, but 6% higher than anticipated production.
For the three-month period ended December 31, 2020, revenues from energy sales totalled $193 million ($225 million), up $14 million ($13 million) or 8% (6%) compared to the same quarter in 2019. This increase stems from higher production from Canadian activities, as previously mentioned.
For the fourth quarter of 2020, the Company recorded a consolidated EBITDA(A) of $137 million ($155 million), down $6 million ($10 million) or 4% (6%) from the same quarter in 2019. This decrease stems from a gain recorded in 2019 following the sale of land in Scotland, the increase in maintenance costs due to production well above expected levels in recent quarters, as well as an increase in compensation linked to a higher stock market price.
Overall, for the three-month period ended December 31, 2020, Boralex recorded earnings of $30 million ($36 million) versus a net loss of $23 million ($15 million) for the same period in 2019. As detailed in the above table, this results in net earnings for Boralex’s shareholders of $25 million ($31 million) or $0.24 ($0.30) per share (base and diluted), compared to a net loss for Boralex’s shareholders of $26 million ($18 million) or 0.28 ($0.19) per share (diluted) for the same period in 2019.
Fiscal year 2020 highlights
IFRS Combined(1)
| 2020 | 2019 | Change | 2020 | 2019 | Change | ||||
| (in millions of Canadian dollars, unless otherwise specified) | $ | % | $ | % | |||||
| Power production (GWh)(2) | 4,727 | 4,371 | 356 | 8 | 5,834 | 5,544 | 290 | 5 | |
| Revenues from energy sales and | 619 | 564 | 55 | 10 | 738 | 687 | 51 | 7 | |
| feed-in premium | |||||||||
| EBITDA(A)(1) | 434 | 402 | 32 | 8 | 513 | 492 | 21 | 4 | |
| Net earnings (loss) | 61 | (43) | 104 | >100 | 56 | (43) | 99 | >100 | |
| Net earnings (loss) attributable to | 55 | (39) | 94 | >100 | 50 | (39) | 89 | >100 | |
| shareholders of Boralex | |||||||||
| Per share – basic and diluted | $0.55 | ($0.43) | $0.98 | >100 | $0.51 | ($0.43) | $0.94 | >100 | |
| Net cash flows related to operating activities | 362 | 294 | 68 | 24 | 399 | 303 | 96 | 31 | ||
| Cash flows from operations(1) | 338 | 310 | 28 | 9 | 378 | 327 | 51 | 16 | ||
| As at | As at | Change | As at | As at | Change | |||||
| Dec. 31 | Dec. 31 | Dec. 31 | Dec. 31 | |||||||
| $ | % | $ | % | |||||||
| Total assets | 5,314 | 4,557 | 757 | 17 | 5,753 | 5,246 | 507 | 10 | ||
| Debt(3) | 3,516 | 3,067 | 449 | 15 | 3,870 | 3,660 | 210 | 6 | ||
| Projects(4) | 3,028 | 2,462 | 566 | 23 | 3,382 | 3,055 | 327 | 11 | ||
| Corporate | 488 | 605 | (117) | (19) | 488 | 605 | (117) | (19) | ||
- See “Combined – Non-IFRS measure” below.
- The production level for which NRWF wind farm was compensated following power generation limitations imposed by the IESO were included in power production, as management uses this measure to evaluate the Corporation’s performance. This change facilitates the correlation between power production and revenues from energy sales and feed-in premium.
- Includes the current (less than one year) portion of debt and transaction expense, net of accrued amortization.
- Project loans are normally amortized over the term of the energy contracts for the related sites and are non-recourse loans on Boralex.
For the year ended December 31, 2020, Boralex generated 4,727 GWh (5,834 GWh) of electricity, which represents an 8% (5%) increase compared to the 4,371 GWh (5,544 GWh) in fiscal 2019. The increase was particularly high in wind power generation, which was 10% (6%) higher than fiscal 2019 and 8% (7%) higher than the expected production.
For the fiscal year ended December 31, 2020, revenue generated from energy sales amounted to $619 million ($738 million), up $55 million ($51 million) or 10% (7%) compared to the same period in 2019. This increase is due to both the expansion of the Company’s operational base, including the resumption of production at the Buckingham hydroelectric power station in Québec, and increased wind farm production due to more favourable wind conditions than last year.
For the fiscal year ended December 31, 2020, the Company has a consolidated EBITDA(A) of $434 million ($513 million), which represents an increase of $32 million ($21 million) or 8% (4%) from last year. This increase stems from the same elements as those mentioned above relating to the increase in revenue from energy sales.
IBF4
