RENO, NV--(Marketwire - Mar 27, 2013) - Ram Power, Corp. (
HIGHLIGHTS
San Jacinto-Tizate Project
- Phase I, which commenced commercial operation in January 2012, generated 299,904 net MWh resulting in revenue of $28.1 million (an increase of 529%) and Adjusted EBITDA (as defined below) of $10.4 million in 2012 compared to revenue of $4.4 million and Adjusted EBITDA of $(12.6) million in 2011;
- Successfully negotiated a 17% increase to the tariff under the power purchase agreement to recoup additional project costs and enhance overall project returns;
- The new tariff is expected to result in an increase in annual revenue of approximately $10 million in 2013; and
- Successful completion of the Phase II project as scheduled and budgeted with commercial operation attained in December 2012.
Refinance of Corporate Credit Facility through the issuance of Senior Debentures
- Successfully closed a C$50.9 million Senior Debenture Private Placement;
- The net proceeds of the Private Placement, together with approximately C$4 million of the Company's funds, were used to repay in full the Company's existing corporate credit facility and associated transaction costs;
- The Private Placement resulted in the Company reducing its cost of funds on its corporate debt from 16% to 8.5% on a per annum basis;
- The Private Placement extended the term of the Company's corporate debt from September 30, 2013 to March 27, 2018 with the Senior Debentures maturing on that date; and
- The January and February payments-in-kind of interest and fees with common shares under the prior corporate credit facility combined with the Private Placement is expected to increase the Company's liquidity $1.3 million in 2013 and $3.8 million annually thereafter.
Reorganization of its Reno, Nevada office
- Optimizes efficiency and aligns the organization to better focus on Nicaragua operations; and
- Resulted in expected savings of $3 million in 2013, and $4 million annually thereafter.
FINANCIAL OVERVIEW
The financial results of Ram Power for the year ended December 31, 2012 and 2011 are summarized below:
| For the year ended December 31, | ||||||||
| (all figures in U.S dollars) | 2012 | 2011 | ||||||
| Total revenue | $ | 28,061,520 | $ | 4,458,153 | ||||
| Direct costs of energy production | 4,359,874 | 1,855,449 | ||||||
| Gross profit | 23,701,646 | 2,602,704 | ||||||
| General and administrative expenses | (11,866,214 | ) | (12,059,911 | ) | ||||
| Operating loss | (2,845,615 | ) | (11,673,337 | ) | ||||
| Loss on impairment | (42,518,283 | ) | (152,213,219 | ) | ||||
| Gain on warrant liability valuation | 5,008,947 | 8,739,785 | ||||||
| Other loss | (1,540,749 | ) | (3,661,013 | ) | ||||
| Deferred taxes | - | 12,421,558 | ||||||
| Total loss and comprehensive loss | (53,789,966 | ) | (151,444,363 | ) | ||||
| Total loss and comprehensive loss per share | $ | (0.19 | ) | $ | (0.64 | ) | ||
| As at December 31, | ||||||||
| 2012 | 2011 | |||||||
| Total assets | $ | 506,823,848 | $ | 510,825,081 | ||||
| Long-term debt | 210,591,894 | 212,984,403 | ||||||
| Total liabilities | 294,542,373 | 248,321,132 | ||||||
| Cash | 51,330,351 | 57,195,330 | ||||||
| Working capital* | (11,325,167 | ) | 45,918,495 | |||||
| *2012 working capital included the net balance of the Corporate Credit Facility of $47,635,186 | ||||||||
For the fiscal year ended December 31, 2012, the Company reported revenue of $28.1 million and a total loss and comprehensive loss of $53.8 million, or $(0.19) per share, compared to revenue of $4.5 million and a total loss and comprehensive loss of $151.4 million, or $(0.64) per share, for fiscal 2011. The 529% increase in revenue resulted from commencing operations of the San Jacinto Phase I expansion in January 2012.
Adjusted EBITDA increased to $10.4 million for the year ended December 31, 2012 compared to $(12.6) million for the prior year. The $23 million increase in Adjusted EBITDA for the year ended December 31, 2012 principally resulted from:
- $21.1 million increase in gross profit from San Jacinto operations
- $3.7 million increase due to 2011 delay damages and other gains and losses
- $2.8 million increase due to reduced salaries and benefits related to the Company's 2011 restructuring
- $2.8 million decrease due to a reduction in 2011 of the supplier tax accrual
- $1.8 million decrease related to 2012 other operating costs associated with maintaining inactive exploration and development properties
For the year ended December 31, 2012, the Company had net operating cash outflows of $3.6 million, net investing cash outflows of $53.8 million and net financing cash inflows of $51.5 million, which combined for a net decrease in cash of $5.9 million. The Company expended $57.3 million for additions to geothermal properties, including $55.3 million for the Phase I and Phase II San Jacinto expansions. At December 31, 2012, the Company had cash of $51.3 million, of which $44.1 million was held for current use in the Phase I and Phase II San Jacinto expansions.
Negative working capital of $11.3 million as of December 31, 2012 resulted from reclassification of the Company's $50 million Corporate Credit Facility to current liabilities based on a maturity date of September 30, 2013. On March 27, 2013, the Company completed an offering of 50,855 units at a price of C$1,000 per unit for gross proceeds of C$50.9 million. Each unit consists of a C$1,000 secured debenture of the Company at an interest rate of 8.5% per annum payable semi-annually, maturing on March 27, 2018, and 1,000 share purchase warrants. Each warrant entitles the holder to acquire one common share of the Company at a price of C$0.30 until March 27, 2018. The net proceeds from the offering were used to repay, in full, the Corporate Credit Facility which eliminated the Company's negative working capital position.
"Commercial operation for the Phase II expansion at San Jacinto brings to a close the construction of a state of the art facility which will produce clean, renewable energy for decades to come," stated Antony Mitchell, Executive Chairman for Ram Power, Corp. "As evidenced by the recent Company reorganization as well as re-financing of the Corporate Credit Facility, the Company continues to examine each facet of our business in our ongoing commitment to deliver shareholder value."
Ram Power will hold its earnings call to discuss the year ending December 31, 2012 financial and operating results on Thursday, March 28, 2013 at 10:00 am EDT (7:00 am PDT). To listen to the call, please dial 1-866-696-5910 by entering the participant pass code 8897919, or on the web at http://bellwebcasting.ca/audience/index.asp?eventid=44041078.
About Ram Power, Corp.
Ram Power is a renewable energy company engaged in the business of acquiring, exploring, developing, and operating geothermal properties, and has interests in geothermal projects in the United States, Canada, and Latin America.
USE OF NON-GAAP MEASURES
Certain non-GAAP measures referenced in this news release have no standardized meaning under International Financial Reporting Standards ("IFRS") and, therefore, are unlikely to be comparable to similar measures presented by other issuers. Where we reference non-GAAP measures, we provide definitions. For example, EBITDA is commonly defined as earnings before interest, taxes, depreciation and amortization. EBITDA is most directly comparable to the GAAP measure operating income or loss, except that depreciation and amortization expenses are included and other gains and losses are excluded in measuring operating income or loss, but depreciation and amortization expenses are excluded and other gains and losses are included in measuring EBITDA. Accordingly, where EBITDA measures are disclosed by the Company, they equal operating income or loss plus depreciation and amortization expenses and other gains, less other losses. Although a non-GAAP measure, management believes users of the Company's financial information find EBITDA and EBITDA adjusted to exclude non-cash stock compensation expense and credits, and warrant liability gains and losses ("Adjusted EBITDA") useful in assessing the Company's financial performance. In the Company's earnings releases, consolidated financial statements and MD&As, unless otherwise noted, all financial data is prepared in accordance with IFRS.
Cautionary Statements
This news release contains certain "forward-looking information" which may include, but is not limited to, statements with respect to future events or future performance, management's expectations regarding the Company's growth, results of operations, estimated future revenue, requirements for additional capital, revenue and production costs, future demand for and prices of electricity, business prospects and opportunities. In addition, statements relating to estimates of recoverable geothermal energy "reserves" or "resources" or energy generation are forward-looking information, as they involve implied assessment, based on certain estimates and assumptions, that the geothermal resources and reserves described can be profitably produced 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", "scheduled", "estimates", "forecasts", "predicts", "intends", "targets", "aims", "anticipates" or "believes" or variations (including negative variations) of such words and phrases or may be identified by statements to the effect that certain actions "may", "could", "should", "would", "might" or "will" be taken, occur or be achieved. 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, general business, economic, competitive, political and social uncertainties; the actual results of current geothermal energy production, development and/or exploration activities and the accuracy of probability simulations prepared to predict prospective geothermal resources; changes in project parameters as plans continue to be refined; possible variations of production rates; failure of plant, equipment or processes to operate as anticipated; accidents, labor disputes and other risks of the geothermal industry; political instability or insurrection or war; labor force availability and turnover; delays in obtaining governmental approvals or in the completion of development or construction activities, or in the commencement of operations; as well as those factors discussed in the section entitled "Risk Factors" in the Company's Annual Information Form. These factors should be considered carefully and readers of this news release should not place undue reliance on forward-looking information.
Although the forward-looking information contained in this news release is based upon what management believes to be reasonable assumptions, there can be no assurance that such 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. The information in this news release, including such forward-looking information, is made as of the date of this news release and, other than as required by applicable securities laws, Ram Power assumes no obligation to update or revise such information to reflect new events or circumstances.
Contact Information:
Steven Scott
Director of Investor Relations
Ram Power, Corp.
Phone: 775-398-3711
Email:
www.ram-power.com