Maxim Power Corp. ("MAXIM" or the "Corporation") (TSX: MXG)
announced today the release of financial and operating results for
the second quarter ended June 30, 2024. The unaudited condensed
consolidated interim financial statements, accompanying notes and
Management’s Discussion and Analysis (“MD&A”) will be available
on SEDAR+ and on MAXIM's website on August 6, 2024. All figures
reported herein are Canadian dollars unless otherwise stated.
FINANCIAL HIGHLIGHTS
|
|
Three Months Ended June 30, |
|
Six Months EndedJune 30, |
|
($ in thousands except per share amounts) |
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
|
Revenue |
17,007 |
|
|
- |
|
|
51,775 |
|
|
- |
|
|
Net income |
1,056 |
|
|
5,964 |
|
|
11,543 |
|
|
13,715 |
|
|
Earnings per share – basic |
0.02 |
|
|
0.12 |
|
|
0.23 |
|
|
0.27 |
|
|
Earnings per share – diluted |
0.02 |
|
|
0.11 |
|
|
0.21 |
|
|
0.24 |
|
|
Adjusted EBITDA (1) |
4,287 |
|
|
8,988 |
|
|
20,209 |
|
|
20,719 |
|
|
Total generation – (MWh) |
365,666 |
|
|
- |
|
|
842,197 |
|
|
- |
|
|
Total fuel consumption – (GJ) |
3,034,857 |
|
|
961 |
|
|
6,950,517 |
|
|
22,507 |
|
|
Average Alberta market power price ($ per
MWh) |
45.17 |
|
|
159.79 |
|
|
72.23 |
|
|
150.95 |
|
|
Average realized power price ($ per MWh) |
46.51 |
|
|
- |
|
|
61.48 |
|
|
- |
|
|
Total net debt (net cash) (1) |
(7,219 |
) |
|
36,096 |
|
|
(7,219 |
) |
|
36,096 |
|
|
Total assets |
434,198 |
|
|
390,009 |
|
|
434,198 |
|
|
390,009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Select financial information was derived from the consolidated
financial statements and is prepared in accordance with GAAP,
except adjusted Earnings before Interest, Income Taxes,
Depreciation and Amortization (“Adjusted EBITDA”), which is a
non-GAAP measure (see Non-GAAP Financial Measures
below). Net debt is included in the notes to the consolidated
financial statements. Net debt is calculated to include: loans and
borrowings (including the convertible loan facility) less
unrestricted cash. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING RESULTS
During the second quarter and first six months
of 2024, revenues increased, while Adjusted EBITDA(1) and net
income decreased as compared to 2023. Revenue increased primarily
due to Milner 2 (“M2”) continuing operations in the second quarter
and first six months of 2024, while it was offline in the
comparable periods of 2023 due to the non-injury fire that occurred
at Milner on September 30, 2022 (“Non-Injury Fire”). Decreases to
net income and Adjusted EBITDA(1) in the second quarter and first
six months 2024 were primarily due to the cessation of business
interruption claims in 2024, partially offset by the net impacts of
operations of M2 in 2024 as compared to the same period in 2023
during which it was offline due to the Non-Injury Fire. Average
realized power prices compared to average market power prices were
lower in the first six months of 2024, primarily due to an
unplanned outage in January 2024 at M2 coinciding with higher
market power prices.
M2 CCGT OPERATIONS
M2 has been experiencing a temporary capability
derate of the legacy cooling tower system. In late May 2024, M2
came offline for a planned outage to address routine maintenance
items and management took the opportunity to aggressively expedite
cleaning efforts on the legacy cooling tower system during the
planned outage window. M2 came back on-line during the first half
of June, with the temporary capability derate largely restored. As
a result, generation from M2 decreased in the second quarter of
2024 as compared to the first quarter of 2024. Management continues
to actively address the remaining derate through corrective
measures which has resulted, and will continue to result in,
variable plant output during this period until output is fully
restored. Management anticipates it will have the capability derate
addressed in the third quarter of 2024.
NORMAL COURSE ISSUER BID
UPDATE
MAXIM’s current normal course issuer bid
(“NCIB”) program is for the August 31, 2023 to August 30, 2024
period. Under this NCIB, the Corporation may purchase for
cancellation up to 2,526,477 common shares of the Corporation.
Collectively under this program and as of the date of this press
release, the Corporation has repurchased and cancelled 252,176
common shares for $1.1 million at a weighted average price of $4.45
per share. MAXIM’s NCIB program is limited to $2.0 million for the
2024 calendar year under the senior credit facility. Any excess is
subject to approval from the lenders under the senior credit
facility.
NON-GAAP FINANCIAL MEASURES
Management evaluates MAXIM’s performance using a
variety of measures. Adjusted EBITDA, as discussed below is a
non-GAAP measure and should not be considered as an alternative to
or to be more meaningful than net income of the Corporation, as
determined in accordance with GAAP, when assessing MAXIM’s
financial performance or liquidity. This measure does not have any
standardized meaning prescribed by GAAP and may not be comparable
to similar measures presented by other companies.
Adjusted EBITDA
Adjusted EBITDA is provided to assist management
and investors in determining the Corporation's approximate
operating cash flow before interest, income taxes, and depreciation
and amortization and certain other non-recurring income and
expenses.
|
Three months endedJune 30 |
Six months endedJune 30 |
|
($000's) |
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
|
GAAP Measures from Condensed Consolidated Statementof
Operations |
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
1,056 |
|
|
5,964 |
|
|
11,543 |
|
|
13,715 |
|
|
Income tax expense |
15 |
|
|
1,862 |
|
|
3,230 |
|
|
4,142 |
|
|
Finance expense, net |
898 |
|
|
1,261 |
|
|
2,242 |
|
|
2,617 |
|
|
Depreciation and amortization |
3,635 |
|
|
1,840 |
|
|
7,264 |
|
|
3,849 |
|
|
|
5,604 |
|
|
10,927 |
|
|
24,279 |
|
|
24,323 |
|
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
Other income, net |
(2,947 |
) |
|
(18,565 |
) |
|
(2,979 |
) |
|
(38,528 |
) |
|
Business interruption insurance claim |
- |
|
|
16,372 |
|
|
- |
|
|
34,522 |
|
|
Unrealized loss (gain) on commodity swaps |
1,373 |
|
|
88 |
|
|
(1,612 |
) |
|
88 |
|
|
Share-based compensation |
257 |
|
|
166 |
|
|
521 |
|
|
314 |
|
|
Adjusted EBITDA |
4,287 |
|
|
8,988 |
|
|
20,209 |
|
|
20,719 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA is calculated as described above
from its most directly comparable GAAP measure, net income, and
adjusts for specific items that are not reflective of the
Corporation’s underlying operations and excludes other non-cash
items.
Adjusted EBITDA is provided to assist management
and investors in determining the Corporation’s approximate
operating cash flows attributable to shareholders before finance
expense, income taxes, depreciation and amortization, and certain
other non-recurring or non-cash income and expenses. Financing
expense, income taxes, depreciation and amortization, loss on
write-off of asset and impairment charges are excluded from the
Adjusted EBITDA calculation, as they do not represent cash
expenditures that are directly affected by operations. Management
believes that presentation of this non-GAAP measure provides useful
information to investors and shareholders as it assists in the
evaluation of performance trends. Management uses Adjusted EBITDA
to compare financial results among reporting periods and to
evaluate MAXIM’s operating performance and ability to generate
funds from operating activities.
In calculating Adjusted EBITDA for the second
quarter and first six months ended June 30, 2024 and June 30, 2023
management excluded certain non-cash and non-recurring
transactions. In both 2024 and 2023, Adjusted EBITDA excluded
unrealized gains or losses on commodity swaps, share-based
compensation and all items of other income and expense except for
business interruption insurance as it reflects a portion of
earnings that would have been earned if M2 was operational.
About MAXIM
Based in Calgary, Alberta, MAXIM is one of
Canada’s largest truly independent power producers. MAXIM is now
focused entirely on power projects in Alberta. Its core asset – the
300 MW H.R. Milner Plant, M2, in Grande Cache, AB – is a
state-of-the-art combined cycle gas-fired power plant that
commissioned in Q4, 2023. MAXIM continues to explore additional
development options in Alberta including its currently permitted
gas-fired generation project and the permitting of its wind power
generation project. MAXIM trades on the TSX under the symbol “MXG”.
For more information about MAXIM, visit our website at
www.maximpowercorp.com. For further information please contact:
Bob Emmott, President and CEO, (403)
263-3021
Kyle Mitton, CFO and Vice President, Corporate
Development, (403) 263-3021
Forward-looking statements
This press release contains forward-looking
statements and forward-looking information (collectively
"forward-looking information") within the meaning of applicable
securities laws relating to MAXIM's plans and other aspects of
MAXIM's anticipated future operations, management focus,
objectives, strategies, financial, operating and production
results. Forward-looking information typically uses words such as
"anticipate", "believe", "project", "expect", "goal", "plan",
"intend", "may", "would", "could" or "will" or similar words
suggesting future outcomes, events or performance. The
forward-looking statements contained in this press release speak
only as of the date thereof and are expressly qualified by this
cautionary statement. Specifically, this press release contains
forward-looking statements concerning, among other things, expected
timing of repairs to M2 cooling tower system and related impact to
operations.
Forward-looking information is based on certain
assumptions and analysis made by MAXIM in light of our experience
and MAXIM’s perception of historical trends, current conditions,
expected future developments and other factors MAXIM believes
appropriate under the circumstances.
MAXIM's actual results, performance or
achievement could differ materially from those expressed in, or
implied by, these forward-looking statements and, accordingly, no
assurance can be given that any of the events anticipated by the
forward-looking statements will transpire or occur, or if any of
them do so, what benefits that MAXIM will derive there from. Risk
factors include that MAXIM may not generate full MW capacity from
the CCGT expansion of M2. Readers are cautioned that the foregoing
lists of factors are not exhaustive. Additional information on
these and other factors that could affect MAXIM’s business,
operations or financial results are included in the reports on file
with applicable securities regulatory authorities, including but
not limited to MAXIM’s Annual Information Form for the year ended
December 31, 2023, which may be accessed on MAXIM’s SEDAR+ profile
at www.sedarplus.ca. These forward-looking statements are made as
of the date of this press release and MAXIM disclaims any intent or
obligation to update publicly any forward-looking statements,
whether as a result of new information, future events or results or
otherwise, other than as required by applicable securities
laws.
Maxim Power (TSX:MXG)
Historical Stock Chart
From Aug 2024 to Sep 2024
Maxim Power (TSX:MXG)
Historical Stock Chart
From Sep 2023 to Sep 2024