Maxim Power Corp. Announces Financial & Operating Results For 2007
Maxim Power Corp. announced the release of financial and operating results for its fourth quarter and year ended December 31, 2007.
During 2007, Maxim states that it outperformed the 2006 record operating results in terms of revenue, megawatt hours ("MWh") generated, EBITDA, and cash provided by operations. Maxim earned revenue from electricity sales of CAN $124.8 (unless otherwise noted, dollar amounts are in Canadian currency) million versus $111.2 million for 2006, an increase of $13.6 million or 12.2%. Generation in 2007 was 1,158,389 MWh versus 1,120,429 MWh in 2006, an increase of 37,960 MWh or 3.4%. 2007 EBITDA was $40.2 million versus $39.1 million in 2006, an increase of $1.1 million or 2.9%. Cash provided by operations was $35.5 million for 2007 versus $23.9 in 2006, an increase of $11.6 million or 49%. Net income was $15.4 million for 2007 versus $19.9 million in 2006, a decrease of $4.5 or 23%.
Maxim increased its revenue despite lower 2007 average Alberta power prices. The average Alberta power price was $67 per MWh in 2007 compared to $80 per MWh in 2006. In North America, a portion from the HR Milner facility’s generation was sold at fixed prices above the 2007 average price. Maxim also benefited from a full year of operations from the Basin Creek and Capitol District Energy Center facilities and received market adjustments reflecting a full year of forward capacity payments from its two power plants operating within the ISO New England market. In France, Maxim acquired 45 MW of generation capacity during 2007 which increased revenue from France as of November 1, 2007 by $5.9 million. Net income declined due to higher levels of interest and depreciation expense from Maxim’s acquisitions in 2007 and 2006.
During the fourth quarter of 2007, Maxim recorded revenue of $38.0 million compared to $40.5 million for 2006 and EBITDA was $12.1 million compared to $17.9 million in 2006 primarily due to lower Alberta power prices. Total production for the fourth quarter was 305,460 MWh compared to 311,312 MWh in 2006 with HR Milner facility producing 247,975 MWh during the fourth quarter of 2007 compared to 253,867 MWh for the same period in 2006.
On September 17, 2007 the company announced that it entered into an agreement with Jersey Central Power and Light Co. ("JCP&L") to acquire the 86 MW Forked River Power Station, located in Ocean County, New Jersey, for US$20.0 million. The transaction is expected to close early in the second quarter of 2008 subject to satisfying remaining conditions precedent to closing and will be financed with cash on hand. In conjunction with this purchase, a ten year tolling agreement will be entered into with FirstEnergy Solutions, a subsidiary of FirstEnergy Corp. and an affiliate of JCP&L, for the entire capacity of the plant. This project is strategically located in New Jersey and includes 30 acres of land and existing infrastructure to support future development of additional generating capacity on site.
