Altius Renewable Royalties Reports Q2 2023 Financial Results
All currency references in USD unless otherwise indicated
Altius Renewable Royalties Corp. (TSX: ARR) (OTCQX: ATRWF) (“ARR” or the “Corporation”) is pleased to report its financial results for the second quarter of 2023 with a conference call to follow August 2, 2023 at 9:00 am EST.
The Corporation’s 50% owned Great Bay Renewables (“GBR”) joint venture recorded $2.0 million in royalty revenue for the quarter ended June 30, 2023 compared to $1.2 million in Q2 2022. Operating cash flows at GBR increased to $1.0 million in the second quarter of 2023 as compared to $0.3 million in Q2, 2022. For the six months ended June 30, 2023 GBR recorded $4.0 million in royalty revenue compared to $2.4 million in the same period in 2022. Operating cash flows at GBR were $1.9 million for the six months ended June 30, 2023 as compared to $0.5 million in the same period in 2022.
ARR reported a net loss of $0.1 million, proportionate revenue(1)of $1.6 million and adjusted EBITDA(1) of $0.7 million for the quarter. This compares to a net loss of $0.5 million, proportionate revenue(1) of $0.7 million and adjusted EBITDA(1) of $(0.1) million in Q2 2022. Total proportionate revenue(1) in Q2 2023 was comprised of $1.0 million in royalty revenue and $0.6 million in interest income.
For the six months ended June 30, 2023 ARR reported a net loss of $0.2 million, proportionate revenue(1) of $3.2 million and adjusted EBITDA(1) of $1.2 million. This compares to a net loss of $0.7 million, proportionate revenue(1) of $1.4 million and adjusted EBITDA(1) of $(0.2) million for the comparative period in 2022. Total proportionate revenue(1) for the six month period was comprised of $2.0 million in royalty revenue and $1.2 million in interest income.
GBR’s operating royalty portfolio benefitted from the additions of each of the Titan Solar, Young Wind, Appaloosa Run and Hansford County Wind projects, which were either acquired or reached operational status in the second half of 2022. GBR continues to progress several new royalty investment opportunities spanning the full spectrum of development to production stage assets while the El Sauz project is currently in construction and expected to reach commercial operation in Q4 2023. Several additional royalty projects continue to be advanced towards construction start by several operators across a variety of US power regions.
Seasonally lower merchant pricing in the current quarter and year to date partially offset the growth in the royalty portfolio. More recently, there has been an increase in merchant pricing due to warmer summer weather and increased power demand.
The Corporation’s current quarter and year to date results reflect the proportionate share of increased revenues at GBR offset by the proportionate share of increased costs including GBR’s non-cash based share of loss of approximately $1.0 million associated with its Bluestar and Nova equity investments. Bluestar and Nova are recently formed development-stage renewable energy businesses.
At June 30, 2023 the Corporation held cash of $41.1 million and has expected commitments for the remainder of 2023 of approximately $11.3 million for existing GBR investment agreements.
Commenting on the quarter, Frank Getman, CEO of GBR, said “Our royalty portfolio revenue and cash flow profile continue to benefit from the addition of operational stage royalties. While there remains robust renewables activity and tailwinds across the US resulting from the IRA and the continued energy transition, ongoing interconnection delays and higher costs of both debt and equity capital creates a strong investment climate for alternative sources of capital such as GBR’s royalty financing.”
Brian Dalton, CEO of ARR added that “GBR continues to gain portfolio scale and diversity at a pace that is exceeding the long-term goals we had set at the time of its IPO in 2021. With now more than 15 GW of development through operating stage royalty projects in the portfolio it is clear that awareness and acceptance of royalty-based funding is becoming a mainstream financing tool within the renewable energy sector. We remain poised to play an increased role in supporting the energy transition and to adding further diversity and scale to the portfolio on behalf of shareholders.”
Non-GAAP Financial Measures
- Management uses the following non-GAAP financial measures: proportionate royalty and other revenue (“proportionate revenue”) and adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA).
- Management uses these measures to monitor the financial performance of the Corporation and believes these measures enable investors and analysts to compare the Corporation’s financial performance with its competitors and/or evaluate the results of its underlying business which are held primarily in jointly controlled entities. These measures are intended to provide additional information, not to replace International Financial Reporting Standards (IFRS) measures, and do not have a standard definition under IFRS and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. As these measures do not have a standardized meaning, they may not be comparable to similar measures provided by other companies. Further information on the composition and usefulness of each non-GAAP financial measure, including reconciliation to their most directly comparable IFRS measures, is included in the non-GAAP financial measures section of our MD&A.
Conference Call Details
A conference call and webcast will be held on Wednesday, August 2, 2023 at 9:00 am EDT to provide an update and to offer an open Q&A session for analysts and investors. Access details are as follows:
DATE: Wednesday, August 2, 2023 at 9:00 am EDT
EVENT: Altius Renewable Royalties Q2 2023 Financial Results, ID 07181885
DIAL IN: +1 888 886 7786 OR +1 416 764 8658
WEBCAST: ARR Q2 2023
ARR is a renewable energy royalty company whose business is to provide long-term, royalty level investment capital to renewable power developers, operators, and originators. ARR has 33 renewable energy royalties representing approximately 1.9 GW of renewable power on operating projects and an additional approximate 6 GW on projects in development phase, across several regional power pools in the U.S. The Corporation also expects future royalties from GBR's investments in Bluestar Energy Capital, Hodson Energy and Hexagon Energy, which increase the total development project pipeline to approximately 15 GW. The total pipeline The Corporation combines industry expertise with innovative, partner-focused solutions to further the growth of the renewable energy sector as it fulfills its critical role in enabling the global energy transition.
This news release contains forward‐looking information. The statements are based on reasonable assumptions and expectations of management and ARR provides no assurance that actual events will meet management's expectations. In certain cases, forward‐looking information may be identified by such terms as "anticipates", "believes", "could", "estimates", "expects", "may", "shall", "will", or "would". Although ARR believes the expectations expressed in such forward‐looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those projected. Readers should not place undue reliance on forward-looking information. ARR does not undertake to update any forward-looking information contained herein except in accordance with securities regulation.
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