AltaGas Ltd. (AltaGas) (TSX:ALA) (TSX:ALA.PR.A) (TSX:ALA.PR.U)
today reported a 150 percent increase in normalized net income per
share. Normalized net income applicable to common shares was $35.5
million ($0.30 per share) for the three months ended June 30, 2013,
compared to $10.4 million ($0.12 per share) for the same period
2012. Net income applicable to common shares reported was $35.9
million ($0.31 per share) for the three months ended June 30, 2013,
compared to $25.8 million ($0.29 per share) for the same period
2012.
Stronger earnings also resulted in stronger cash flows.
Normalized EBITDA more than doubled to $106.2 million for second
quarter 2013 compared to $51.7 million in second quarter 2012.
Normalized funds from operations increased to $83.1 million ($0.71
per share) for second quarter 2013 compared to $40.7 million ($0.45
per share) for second quarter 2012.
"We are pleased to report another very solid quarter with
substantial growth in earnings and cash flow," said David Cornhill,
Chairman and CEO of AltaGas. "We had strong performance from all
our businesses and we have attractive growth opportunities.
Therefore, we are pleased to announce our Board approved a dividend
increase of a quarter cent per share per month. In addition to the
increase approved last quarter, this results in a $0.09 cent or
6.25 percent increase to our dividend on an annualized basis. On a
full year basis the dividend is now $1.53 per share. The Board and
management remain committed to enhancing returns for our
shareholders."
Normalized net income for the six months ended June 30, 2013
increased to $91.1 million, an 80 percent increase over the same
period 2012. Normalized net income per share increased 46 percent
to $0.82 per share, up from $0.56 per share.
For the six months ended June 30, 2013, normalized EBITDA
increased 76 percent to $252.1 million compared to $143.1 million
for the same period 2012. Normalized funds from operations for the
six months ended June 30, 2013, increased 78 percent to $205.5
million ($1.84 per share) compared to $115.5 million ($1.29 per
share) for the same period 2012.
Operating income from the business segments increased 89 percent
in the second quarter 2013 compared to the same quarter 2012,
primarily driven by the addition of the U.S. utilities in August
2012, higher throughput in the Gas business, higher power prices
realized and the addition of the new Blythe power facility in
mid-May 2013. Earnings were partially offset by lower frac spreads
and higher operating costs in the quarter.
AltaGas also announced today that its wholly owned subsidiary
Pacific Northern Gas Ltd. (PNG) has entered into Transportation
Reservation Agreements with both Douglas Channel Gas Services Ltd.
and AltaGas Idemitsu Joint Venture Limited Partnership for 520
Mmcf/d of natural gas transportation capacity on the proposed PNG
pipeline expansion. The PNG expansion is expected to increase
capacity of the PNG system to approximately 750 Mmcf/d from its
current capacity of 115 Mmcf/d. PNG continues to work with other
potential shippers for the remaining capacity.
"Securing shippers for the expansion of our PNG pipeline has
been a critical milestone toward executing on our LNG export
plans," said Mr. Cornhill. "We are pleased with our progress and
continue to work with other shippers to secure the remaining
capacity on the pipeline expansion. We continue to lead the way in
getting Canadian natural gas to export markets."
AltaGas also announced today the expansion of its Cogeneration
fleet at Harmattan to 45 MW. AltaGas will construct the new 15 MW
Cogeneration facility to meet the increased power demand at the
Harmattan complex and increase sales to the Alberta power market.
Cogen III is expected to be in service in the fourth quarter 2014
with a total project cost estimated at $40 million.
AltaGas is also expanding its Cold Lake natural gas transmission
system to deliver natural gas to provide steam to two heavy oil
projects near Cold Lake, Alberta. The estimated cost of both
projects is $17 million and both are underpinned by long-term
take-or-pay transportation agreements. The expansion is expected to
be in service in late 2014.
AltaGas continues to make good progress on the Northwest
run-of-river projects, which include the Forrest Kerr, McLymont
Creek and Volcano Creek generation facilities. The projects remain
ahead of schedule and on budget. The powerhouse activities continue
as planned and the power tunnel inlet gate control structure and
intake desander structure was completed in the quarter. Three
turbine units are on-site with installation expected to begin by
mid-August. The installation of the penstock and turbines are
expected to be completed in third quarter 2013. The project is
expected to be mechanically complete by the end of 2013, with
commissioning to follow based on the availability of the Northwest
Transmission Line (NTL). In-service date is on target for
mid-2014.
Construction continues to progress on both the 66 MW McLymont
Creek project and 16 MW Volcano Creek project. The McLymont Creek
engineering design is now 95 percent complete. Construction of the
7-kilometre McLymont intake access road is on-going and the pioneer
trail is 55 percent completed and anticipated to be completed
within the next 90 days. Excavation of the McLymont power portal
has been completed and approximately 15 percent of the 2,800-metre
power tunnel has been excavated. Excavation of the Volcano Creek
intake site and diversion have been completed and the installation
of the weir embeds has commenced. At Volcano Creek 100 percent of
the penstock right-of-way has been cleared and excavation of the
penstock trench has commenced. The powerhouse foundation is
approximately 80 percent complete and excavation of the headrace is
complete. The two projects are expected to be in service in
mid-2015.
Monthly Common Share Dividend and Quarterly Preferred Share
Dividend
-- The Board approved a dividend of $0.1275 per common share for the August
2013 dividend. The dividend will be paid on September 16, 2013, to
common shareholders of record on August 26, 2013. The ex-dividend date
is August 22, 2013. This dividend is an eligible dividend for Canadian
income tax purposes;
-- The Board approved a dividend of $0.3125 per share for the period
commencing July 1, 2013, and ending September 30, 2013, on AltaGas'
outstanding Series A Preferred Shares. The dividend will be paid on
September 30, 2013 to shareholders of record on September 16, 2013. The
ex-dividend date is September 12, 2013; and
-- The Board also approved a dividend of US$0.275 per share for the period
commencing July 1, 2013, and ending September 30, 2013, on AltaGas'
outstanding Series C Preferred Shares. The dividend will be paid on
September 30, 2013, to shareholders of record on September 16, 2013. The
ex-dividend date is September 12, 2013.
CONSOLIDATED FINANCIAL REVIEW
Three months ended Six months ended
(unaudited) June 30 June 30
($ millions) 2013 2012 2013 2012
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Revenue 458.6 272.2 1,072.1 633.8
Net revenue(1) 211.8 144.0 449.1 310.4
Normalized operating income(1) 68.0 30.4 177.2 99.7
Normalized EBITDA(1) 106.2 51.7 252.1 143.1
Net income applicable to common
shares 35.9 25.8 85.0 67.1
Normalized net income(1) 35.5 10.4 91.1 50.6
Total assets 6,704.3 3,852.1 6,704.3 3,852.1
Total long-term liabilities 3,598.9 1,901.1 3,598.9 1,901.1
Net additions to property, plant and
equipment 715.8 176.4 835.5 323.8
Dividends declared(2) 43.8 31.1 81.8 62.0
Cash flows
Normalized funds from
operations(1) 83.1 40.7 205.5 115.5
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Three months ended Six months ended
June 30 June 30
($ per share, except shares
outstanding) 2013 2012 2013 2012
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Normalized EBITDA(1) 0.90 0.57 2.26 1.59
Net income - basic 0.31 0.29 0.76 0.75
Net income - diluted 0.30 0.28 0.74 0.74
Normalized net income(1) 0.30 0.12 0.82 0.56
Dividends declared(2) 0.37 0.345 0.73 0.69
Cash flows
Normalized funds from
operations(1) 0.71 0.45 1.84 1.29
Shares outstanding - basic
(millions)
During the period(3) 117.7 90.0 111.7 89.8
End of period 118.4 90.3 118.4 90.3
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(1) Non-GAAP financial measure; see discussion in Non-GAAP Financial
Measures section of the second quarter 2013 MD&A.
(2) Dividends declared of $0.12 per common share per month commencing
September 10, 2012 and $0.125 commencing May 2013.
(3) Weighted average.
CONFERENCE CALL AND WEBCAST DETAILS:
AltaGas will hold a conference call today at 9:00 a.m. MT (11:00
a.m. ET) to discuss second quarter financial results, progress on
construction projects and other corporate developments.
Members of the media, investment communities and other
interested parties may dial (416) 340-8410 or call toll free at
1-866-225-2055. There is no passcode. Please note that the
conference call will also be webcast. To listen, please go to
http://www.altagas.ca/investors/presentations_and_events. The
webcast will be archived for one year.
Shortly after the conclusion of the call, a replay will be
available by dialing (905) 694-9451 or 1-800-408-3053. The passcode
is 6668430. The replay expires at midnight (Eastern) on August 8,
2013.
This news release contains forward-looking statements. When used
in this news release, the words "may", "would", "could", "will",
"intend", "plan", "anticipate", "believe", "seek", "propose",
"estimate", "expect", and similar expressions, as they relate to
AltaGas or an affiliate of AltaGas, are intended to identify
forward-looking statements. In particular, this news release
contains forward-looking statements with respect to, among other
things, business objectives, expected growth, results of
operations, performance, business projects and opportunities and
financial results. These statements involve known and unknown
risks, uncertainties and other factors that may cause actual
results or events to differ materially from those anticipated in
such forward-looking statements. Such statements reflect AltaGas'
current views with respect to future events based on certain
material factors and assumptions and are subject to certain risks
and uncertainties, including without limitation, changes in market,
competition, governmental or regulatory developments, general
economic conditions and other factors set out in AltaGas' public
disclosure documents. Many factors could cause AltaGas' actual
results, performance or achievements to vary from those described
in this news release, including without limitation those listed
above. These factors should not be construed as exhaustive. Should
one or more of these risks or uncertainties materialize, or should
assumptions underlying forward-looking statements prove incorrect,
actual results may vary materially from those described in this
news release as intended, planned, anticipated, believed, sought,
proposed, estimated or expected, and such forward-looking
statements included in, or incorporated by reference in this news
release, should not be unduly relied upon. Such statements speak
only as of the date of this news release. AltaGas does not intend,
and does not assume any obligation, to update these forward-looking
statements. The forward-looking statements contained in this news
release are expressly qualified by this cautionary statement.
Contacts: AltaGas Ltd. Investment Community
1-877-691-7199investor.relations@altagas.ca AltaGas Ltd. Media
(403) 691-9873media.relations@altagas.ca
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