Polaris Renewable Energy (PIF) Q2 2024 earnings summary

Executive summary

• Power production for Q2 2024 was 186,887 MWh, down 11% year-over-year, mainly due to scheduled maintenance in Nicaragua and earlier dry season in Peru, while the Dominican Republic and Panama saw improved or in-line performance.

• Revenue for Q2 2024 was $18.7 million, down from $20.8 million in Q2 2023, reflecting lower production in key markets.

• Net earnings attributable to owners/shareholders were $985,000 ($0.05 per share), a significant decrease from $4.6 million ($0.22 per share) in the prior year period.

• Adjusted EBITDA for Q2 2024 was $13.3 million, down from $15.4 million year-over-year.

• The company maintained cost controls, keeping direct and G&A expenses flat despite new operating costs from the Panama solar park.

Financial highlights

• Six-month net cash flow from operating activities was $17.0 million, with a cash position of $45.2 million as of June 30, 2024.

• Net cash from operating activities declined due to lower cash received from Nicaragua and recognition of unearned revenue in Peru.

• Net cash used in investing activities was considerably lower, reflecting completion of major projects in 2023 and current focus on maintenance and optimization.

• Total assets stood at $509.1 million, with total liabilities of $239.9 million and current/long-term debt of $165.9 million as of June 30, 2024.

• Quarterly dividend of $0.15 per share declared for Q2 2024, payable August 23, 2024.

Outlook and guidance

• Major maintenance in Nicaragua completed on time and on budget, supporting a shift to 18-month maintenance intervals.

• Canoa One solar panel replacement in the Dominican Republic is on schedule, with full benefits expected in upcoming quarters.

• Expansion of Canoa and ongoing M&A remain key growth initiatives, with an acquisition expected within 60-90 days.

• CapEx for Dominican Republic expansion expected to be $10 million in Q4 2024 and $25 million in 2025, with improved IRRs around 20%.

• Generation expectations for the remainder of 2024 and longer term remain intact despite Q2 production challenges.