RCS - Polaris Renewable - Polaris Renewable Energy Annual 2024 Results

Banco Santander SAAnnouncement

20/02/2025 14:00

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RNS Number : 8439X  Polaris Renewable Energy Inc  20 February 2025

 Polaris Renewable Energy Announces Q4 And Annual 2024 Results

Polaris Renewable Energy Inc. (TSX:PIF) ("Polaris Renewable Energy" or the
"Company"), is pleased to report its financial and operating results for the
year ended December 31, 2024. This earnings release should be read in
conjunction with the Company's consolidated financial statements and
management's discussion and analysis, which are available on the Company's
website at www.PolarisREI.com (https://pr.report/7f59)  and have been posted
on SEDAR+ at www.sedarplus.ca (https://pr.report/7f5a) . The dollar figures
below are denominated in US Dollars unless noted otherwise.

HIGHLIGHTS

·      For the quarter ended December 31, 2024 consolidated energy
production increased by 2% when compared to the same quarter in 2023, while
annual consolidated energy production was 764,756 MWh for the year ended
December 31, 2024 versus 800,951 for the year ended December 31, 2023.

·      The Company generated $75.8 million in revenue from energy sales
for the year ended December 31, 2024, compared to $78.5 million in the same
period in 2023. Lower revenue resulted from, principally, lower production in
the Company's geothermal facility in Nicaragua.

·      Adjusted EBITDA was $55.0 million for the year ended December 31,
2024, compared to Adjusted EBITDA of $57.7 million in the same period in 2023,
principally due to lower revenue from the Company's geothermal facility in
Nicaragua.

·      During the quarter ended December 31, 2024, the Company closed a
private placement of $175 million senior secured green bonds (the "Green
Bonds"). The Green Bonds have a tenor of five years and a fixed coupon rate of
9.5% percent per annum, with interest payable in semi-annual installments. The
Green Bonds include a tap feature, allowing the Company access to an
additional $50 million in funding for potential future uses. Net proceeds of
the Green Bonds will be used to refinance certain existing debt facilities and
fund other investments in renewable energy assets.

·      For the year ended December 31, 2024, the Company generated $35.1
million in net cash flow from operating activities, ending with a cash
position of $217.9 million, including $120 million used in January 2025 to
settle the existing debt facilities, as mentioned above, and including
restricted cash of $4.6 million.

·      Net earnings attributable to shareholders, was $3.0 million or
$0.14 per share - basic for the year ended December 31, 2024, compared to net
earnings of $11.7 million or $0.56 per share - basic in 2023.

·      During the year, the Company concluded its phase 1 optimization
project in the Dominican Republic, consisting of replacing approximately 50%
of its photovoltaic ("PV") panels at the solar plant Canoa 1. The replaced
panels are expected to boost productivity of the plant by at least 15%.

·      On August 20, 2024, the Company announced that the Toronto Stock
Exchange (the "TSX") accepted its notice of intention to renew its normal
course issuer bid ("NCIB"), under which Polaris may purchase up to 2,045,613
of its common shares during the twelve-month period commencing August 23,
2024. During the year ended December 31, 2024, the Company repurchased and
cancelled 23,600 common shares, for total consideration of $0.2 million at an
average price of C$12.16 per share.

·      On October 29, 2024, the Company announced it had signed an
Equity Capital Contribution Agreement ("ECCA") with respect to Punta Lima Wind
Farm LLC ("PLWF" or the "Project"), a wholly owned subsidiary of Santander
Bank N.A. ("Santander"). The Project operates an onshore wind farm with a
nameplate capacity of 26.0 MW's located in the Municipality of Naguabo, Puerto
Rico. The transaction is being completed using a tax-equity structure which
will result in Polaris, through a wholly owned subsidiary, operating the
Project and Santander retaining a tax equity interest in the Project. The
agreed upon equity contribution is $20 million. The transaction is subject to
customary closing conditions and it is expected to close in the first quarter
of 2025.

·      The Company remains focused on maintaining a quarterly dividend.
For the year ended December 31, 2024, the Company declared and paid $12.6
million in dividends. The Company has declared and will pay a quarterly
dividend of $0.15 per outstanding common share on February 28, 2025, to
shareholders of record as of February 17, 2025.

OPERATING AND FINANCIAL OVERVIEW

                                                                     Three Months Ended                                              Year Ended
                                                                     December 31, 2024                 December 31, 2023             December 31, 2024                   December 31, 2023
 Energy production
 Consolidated Power MWh                                                         195,797                           192,820                          764,756                           800,951
 Financials
 Total revenue                                                       $          18,781                 $          18,748             $             75,773                $           78,522
 Net earnings (loss) attributable to owners                          $          (2,792     )           $          1,408              $             2,990                 $           11,744
 Adjusted EBITDA                                                     $          13,566                 $          13,391             $             55,042                $           57,663
 Net cash flow from operating activities                             $          9,079                  $          10,167             $             35,054                $           43,960

 Per share
 Net earnings (loss) attributable to owners - basic and diluted      $          - 0.13                 $          0.07               $             0.14                  $           0.56
 Adjusted EBITDA - basic                                             $          0.64                   $          0.64               $             2.60                  $           2.74

 Balance Sheet                                                                                                                       As at December 31, 2024             As at

December 31, 2023
 Total cash and cash equivalents (Restricted and Unrestricted)                                                                       $             217,882               $           44,683
 Total current assets                                                                                                                $             228,563               $           54,042
 Total assets                                                                                                                        $             662,105               $           519,400
 Current and Long-term debt                                                                                                          $             328,349               $           172,379
 Total liabilities                                                                                                                   $             402,579               $           249,468

During the three months ended December 31, 2024,quarterly consolidated power
production was higher than the same period in 2023, mainly driven by an
expected increase in production in Nicaragua driven by greater stability in
the geothermal wells compared to the same period in 2023, as well as better
generation in Dominican Republic resulting from the repowering project
executed during 2024, partly offset by lower production in Ecuador.

For Nicaragua, the fourth quarter of 2023 saw an incremental temporary
instability in cycling wells that depressed production. In 2024 the Company
made the decision to lower the throughput of the Binary unit by approximately
2.0 MWh in order to maintain declines from the steam field within a targeted
range, hence the stabilization of production and better results when compared
with the same quarter of the prior year.

Consolidated production in Peru for the three months ended December 31, 2024,
was in line with the comparative period in 2023 due to greater water
availability at both Canchayllo and El Carmen, partially offsetting a lower
hydrology resource for 8 de Agosto.

The Canoa 1 facility in the Dominican Republic, produced 14,315 MWh in the
three months ended December 31, 2024. This is a 12% increase versus the fourth
quarter of 2023 despite lower irradiation. This increase reflects the enhanced
productivity of the new solar panels for which the company finalized
installation at the end of Q3 2024.

For Ecuador, in the fourth quarter of 2024, HSJM's production of 6,395 MWh was
lower than the comparative period in 2023 (8,301 MWh) due to resource
availability. Overall, and similar to Peru, production in Ecuador is driven by
the dry and rainy season, with the rainy season generally starting in
October-November and running until May-June.

In Panama, Vista Hermosa Solar Park production of 4,389 MWh for the three
months ended December 31, 2024, was marginally lower than the same period 2023
and below management's expectations due to resource (irradiation)
availability.

"In 2024, we are proud to report that despite ongoing inflationary pressures,
we successfully managed to reduce our combined direct costs and General &
Administrative expenses slightly compared to 2023. This reflects our
commitment to operational efficiency and prudent financial management.
Additionally, we strengthened our capital position by completing a $175
million in Bond issue and signing an Equity Capital Contribution agreement for
Punta Lima Wind Farm in Puerto Rico. Looking ahead, we are excited to be on
track to finalize the acquisition of the wind farm. The combined effect of the
Bond issuance and the wind farm acquisition sets us up to accelerate our
growth initiatives and drive long-term value", noted Marc Murnaghan, Chief
Executive Officer of Polaris Renewable Energy.

About Polaris Renewable Energy Inc.

Polaris Renewable Energy Inc. is a Canadian publicly traded company engaged in
the acquisition, development, and operation of renewable energy projects in
Latin America & the Caribbean. We are a high-performing and financially
sound contributor to the energy transition.

The Company's operations include a geothermal plant (~82 MW), four run-of
river hydroelectric plants (~39 MW), three solar (photovoltaic) projects in
operation (~35 MW) and one wind park (26 MW) following closing of the Puerto
Rico acquisition.

For more information, contact:

Investor Relations

Polaris Renewable Energy Inc.

Phone: +1 647-245-7199

Email: info@PolarisREI.com

Cautionary Statements

This MD&A contains "forward-looking information" within the meaning of
applicable Canadian securities laws, which may include, but is not limited to,
financial and other projections as well as statements with respect to future
events or future performance, management's expectations regarding the
Company's growth, results of operations, business prospects and opportunities.
In addition, statements relating to estimates of recoverable energy
"resources" or energy generation capacities are forward-looking information,
as they involve implied assessment, based on certain estimates and
assumptions, that electricity can be profitably generated from the described
resources in the future. Such forward-looking information reflects
management's current beliefs and is based on information currently available
to management. Often, but not always, forward-looking statements can be
identified by the use of words such as "plans", "expects", "is expected",
"budget", "estimates", "goals", "intends", "targets", "aims", "likely",
"typically", "potential", "probable", "projects", "continue", "strategy",
"proposed", or "believes" or variations (including negative variations) of
such words and phrases or may be identified by statements to the effect that
certain actions, events or results "may", "could", "should", "would", "might"
or "will" be taken, occur or be achieved.

Forward-looking information in this MD&A includes, but is not limited to:
the expected production capacity of the Binary Unit at San Jacinto; additional
changes to the wells and steamfield to increase production; the ability to
successfully capitalize on expansion opportunities in Dominican Republic and
to increase the load factor on Canoa Solar Park in Dominican Republic; future
development of and costs related to the Perlabi project, in Ecuador; the
completion and timing of the Project pursuant to the ECCA; receipt of
regulatory approval in respect of the offtake agreement for the 10MW solar
plan operation in Panama; execution of agreements with respect to annual and
monthly bids for Firm Rights; future dividends; expected annual energy
production; sufficiency of cash flows from operations; the ability to satisfy
capital requirements and the replacement of debt; the result of changes to the
reinjection system over the long-term; and the verification process and timing
regarding the sale of carbon emission credits.

A number of known and unknown risks, uncertainties and other factors may cause
the actual results or performance to materially differ from any future results
or performance expressed or implied by the forward-looking information. Such
factors include, among others: failure to discover and establish economically
recoverable and sustainable resources through exploration and development
programs; imprecise estimation of probability simulations prepared to predict
prospective resources or energy generation capacities; variations in project
parameters and production rates; defects and adverse claims in the title to
the Company's properties; failure to obtain or maintain necessary licenses,
permits and approvals from government authorities; the impact of changes in
foreign currency exchange and interest rates; changes in government
regulations and policies, including laws governing development, production,
taxes, labour standards and occupational health, safety, toxic substances,
resource exploitation and other matters; availability of government
initiatives to support renewable energy generation; increase in industry
competition; fluctuations in the market price of energy; impact of significant
capital cost increases; the ability to file adjustments in respect of
applicable power purchase agreements; unexpected or challenging geological
conditions; changes to regulatory requirements, both regionally and
internationally, governing development, geothermal or hydroelectric resources,
production, exports, taxes, labour standards, occupational health, waste
disposal, toxic substances, land use, environmental protection, project safety
and other matters; economic, social and political risks arising from potential
inability of end-users to support the Company's properties; insufficient
insurance coverage; inability to obtain equity or debt financing; fluctuations
in the market price of the common shares; inability to retain key personnel;
the risk of volatility in global financial conditions, as well as a
significant decline in general economic conditions; uncertainty of political
stability in countries in which the Company operates; uncertainty of the
ability of Nicaragua, Peru, Panama, Dominican Republic and Ecuador to sell
power to neighbouring countries; economic insecurity in Nicaragua, Peru,
Panama, Dominican

Republic and Ecuador; and other development and operating risks, as well as
those factors discussed in the section entitled " Financial Risks" and
"External Risks" in this MD&A. There may be other factors that cause
actions, events or results not to be as anticipated, estimated or intended.
These factors are not intended to represent a complete list of the risk
factors that could affect us. These factors should be carefully considered,
and readers of this MD&A should not place undue reliance on forward
looking information.

Such forward-looking information is based on a number of material factors and
assumptions, including: the Company's historical financial and operating
performance; that contracted parties provide goods and/or services on the
agreed timeframes; the success and timely completion of planned exploration
and expansion programs, including the Company's ability to comply with local,
state and federal regulations dealing with operational standards and
environmental protection measures; the Company's ability to negotiate and
obtain PPAs on favourable terms; the Company's ability to obtain necessary
regulatory approvals, permits and licenses in a timely manner; the
availability of materials, components or supplies; the Company's ability to
solicit competitive bids for drilling operations and obtain access to critical
resources; the growth rate in net electricity consumption; continuing support
and demand for renewables; continuing availability of government initiatives
to support the development of renewable energy generation; the accuracy of
volumetric reserve estimation methodology and probabilistic analysis used to
estimate the quantity of potentially recoverable energy; environmental,
administrative or regulatory barriers to the exploration and development of
geothermal or hydroelectric resources of the Company's properties; geological,
geophysical, geochemical and other conditions at the Company's properties; the
reliability of technical data, including hydrological, extrapolated
temperature gradient, geophysical and geochemical surveys and geothermometer
calculations; the accuracy of capital expenditure estimates; availability of
all necessary capital to fund exploration, development and expansion programs;
the Company's competitive position; the ability to continue as a going concern
and general economic conditions.

Although the Company has attempted to identify important factors that could
cause actual actions, events or results to differ materially from those
described in forward-looking information, there may be other factors that
cause actions, events or results to differ from those anticipated, estimated
or intended. Forward-looking information contained herein is provided as at
the date of this MD&A and the Company disclaims any obligation to update
any forward-looking information, whether as a result of new information,
future events or results or otherwise, except as required by applicable laws.
There can be no assurance that forward-looking information will prove to be
accurate, as actual results and future events could differ materially from
those anticipated in such information. Accordingly, readers should not place
undue reliance on forward looking information due to the inherent uncertainty
therein.

Descriptions and reconciliations of the above noted non-GAAP performance
measures are included in Section 13: NonGAAP Performance Measures in the
Company's MD&A for the year ended December 31, 2024 and on the Company's
website www.polarisREI.com/Non-GAAP (https://pr.report/7f5b) .
(https://pr.report/7f5b)

SOURCE: Polaris Renewable Energy Inc.

 

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