Maxim Power Corp. Announces 2017 First Quarter Financial and Operating Results

CALGARY, ALBERTA -- (Marketwired) -- May 11, 2017 -- Maxim Power Corp. ("MAXIM" or the "Corporation") (TSX: MXG) announced today the release of financial and operating results for the first quarter ended March 31, 2017. The unaudited condensed consolidated interim financial statements, accompanying notes and Management Discussion and Analysis ("MD&A") will be available on SEDAR and on MAXIM's website on May 11, 2017. All figures reported herein are Canadian dollars unless otherwise stated.

The Financial Highlights below include the results from MAXIM's continuing operations and Maxim Power (USA), Inc. ("MUSA") which is recorded as discontinued operations in MAXIM's financial statements. COMAX France S.A.S. ("COMAX") has been excluded for comparative purposes as the segment was sold in December 2016. Refer to MAXIM's unaudited condensed consolidated interim financial statements and MD&A for further details.

FINANCIAL HIGHLIGHTS


                                                                            
                                              Three Months Ended March 31   
($ in thousands except per share amounts)              2017            2016 
----------------------------------------------------------------------------
Revenue                                      $       16,225  $       15,052 
Adjusted EBITDA (1)                                  (2,041)         (3,543)
Net loss attributable to shareholders                (3,585)         (9,973)
  Per share - basic and diluted              $        (0.07) $        (0.18)
FFO (1)                                                (622)         (3,794)
  Per share - basic and diluted              $        (0.01) $        (0.07)
Net Generation Capacity (MW) (2)                        603             603 
Average Alberta market power price ($ per                                   
 MWh)                                        $        22.40  $        18.12 
Average Milner realized power price ($ per                                  
 MWh)                                        $        29.01  $        20.95 
Average Northeast US realized power price                                   
 (US$ per MWh)                               $        68.96  $        37.25 
(1)  Select financial information was derived from the unaudited condensed  
     consolidated interim financial statements and is prepared in accordance
     with GAAP, except adjusted earnings before interest, taxes,            
     depreciation and amortization ("EBITDA") and adjusted net loss.        
     Adjusted EBITDA is provided to assist management and investors in      
     determining the Corporation's approximate operating cash flows before  
     interest, income taxes, and depreciation and amortization and certain  
     other income and expenses. Funds from operating activities before      
     changes in working capital ("FFO") is provided to assist management and
     investors in determining the Corporation's cash flows generated from   
     operations before the cash impact of working capital fluctuations.     
     Adjusted EBITDA and FFO do not have any standardized meaning prescribed
     by GAAP and may not be comparable to similar measures presented by     
     other companies.                                                       
(2)  Generation capacity is manufacturer's nameplate capacity net of        
     minority ownership interests of third parties and uncontacted capacity 
     on contracted generating facilities. Includes 447 MW of net generation 
     capacity from MUSA.                                                    

OPERATING RESULTS

During the first quarter of 2017, revenue, adjusted EBITDA and FFO increased, and net loss attributable to shareholders decreased compared to the same period in 2016. Revenue, adjusted EBITDA and FFO increased as a result of higher realized Northeast U.S. power prices. In addition, adjusted EBITDA and FFO increased as a result of lower fuel and maintenance costs in conjunction with realized gains on commodity risk management activities in Canada, partially offset by an increase in foreign exchange risk management costs realized in relation to the MUSA sale's process. In addition to the discussion noted above, net loss attributable to shareholders decreased in 2017 as a result of inventories write-downs in 2016.

AGREEMENT TO SELL MUSA

As previously reported on April 3, 2017, MAXIM announced that it has closed the sale of 100% of its ownership interest in its wholly-owned subsidiary MUSA to an affiliate of Hull Street Energy, LLC. The implied enterprise value was approximately $106 million USD inclusive of working capital. Net proceeds to MAXIM after accounting for debt and transaction costs are approximately $84 million USD.

MAXIM will utilize $8 million CAD of the net sales proceeds as collateral for letters of credit that are securing potential obligations of the Corporation and $5 million USD to fulfill obligations under the FERC Settlement agreement previously disclosed on September 26, 2016. The remainder of the proceeds will be held by MAXIM for strategic corporate purposes. Refer to page 12 of the MD&A for details on the Corporation's pro-forma financial position after collecting the proceeds on sale.

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