Transeastern Power Trust
TSX VENTURE : TEP.UN
TSX VENTURE : TEP.DB

Transeastern Power Trust

August 29, 2017 17:10 ET

Transeastern Power Trust Reports Second Quarter 2017 Results

TORONTO, ONTARIO--(Marketwired - Aug. 29, 2017) - Transeastern Power Trust ("Transeastern" or the "Trust") (TSX VENTURE:TEP.UN)(TSX VENTURE:TEP.DB) has released its unaudited financial results for the quarter ended June 30, 2017. All amounts in this release are expressed in Canadian dollars unless otherwise indicated.

Q2 2017 Highlights

  • Produced 19,937 MWh of energy for the quarter ended June 30, 2017 compared to 10,042 MWh in the second quarter of 2016, an increase of 98% and generated revenue of $3,368,019 from the sale of electricity and green certificates.

  • Production at Rott has increased by 34% to 1,892 MWh for the three months ended June 30, 2017 versus 1,409 MWh for the quarter ended June 30, 2016 which reflects the improved operational efficiencies derived from the capital improvements that have been made in the past year.

  • Earned operating margin1 (revenues less operating expenses) of $2,239,890 for the quarter, an increase of 44% over the operating margin of $1,622,682 for the second quarter of 2016 (see reconciliation of operating margin under "Non-GAAP Measures").

  • Repaid $1,454,312 in principal on our solar and wind projects' capital leases.

  • The Trust closed a non-brokered private placement of $3,420,000 principal amount of unsecured promissory notes (the "Notes"). The Notes mature on May 31, 2018 and bear interest at a rate of 1.5% per month. The net proceeds of the private placement were principally used towards the deposit for the acquisition of the 45 MW wind farm located in the Dobrogea Region, Romania (the "Dorobantu Wind Project").

  • Subsequent to the end of the quarter, on July 20, 2017, the Trust signed a binding agreement with OMV Petrom for the acquisition of OMV Petrom Wind Power SRL operating the Dorobantu Wind Project. The net purchase price of the Dorobantu Wind Project is EUR23.0 million. Closing of the acquisition is subject to various conditions precedent and the Trust is finalizing the financings required to complete the acquisition. Assuming all necessary conditions are met, the Trust anticipates that the acquisition will close before the end of 2017.

1 Operating margin is a non-GAAP measure calculated by deducting cost of sales from revenues. Refer to "Non-GAAP Measures" in the Trust's Management's Discussion and Analysis for the period ended June 30, 2017 for further details.

J. Colter Eadie, Chief Executive Officer of Transeastern commented "We are beginning to see the improved operating efficiency of our hydro assets and continue to see the production increases expected as a result of the Baia Wind acquisition in 2016. We are excited with the progress to date towards closing the acquisition of the Dorobantu Wind Project which will result in another substantial increase to our power production and revenues".

About Transeastern

The Trust, through its direct and indirect subsidiaries in Canada, the Netherlands and Romania, has been formed to acquire interests in renewable energy assets in Romania, other countries in Europe and abroad that can provide stable cash flow to the Trust and a suitable risk-adjusted return on investment. The Trust seeks to provide investors with long-term, stable distributions, while preserving the capital value of its investment portfolio through investment, principally in a range of operational assets, which generate electricity from renewable energy sources, with a particular focus on solar and hydro power. The Trust intends to qualify as a "mutual fund trust" under the Income Tax Act (Canada) (the "Tax Act"). The Trust will not be a "SIFT trust" (as defined in the Tax Act), provided that the Trust complies at all times with its investment restriction which precludes the Trust from holding any "non-portfolio property" (as defined in the Tax Act). All material information about the Trust may be found under Transeastern's issuer profile at www.sedar.com.

Forward-Looking Statements Except for statements of historical fact contained herein, the information in this press release constitutes "forward-looking information" within the meaning of Canadian securities law. Such forward-looking information may be identified by words such as "anticipates", "plans", "proposes", "estimates", "intends", "expects", "believes", "may" and "will". There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from such statements. Factors that could cause actual results to differ materially include, among others: risks related to foreign operations (including various political, economic and other risks and uncertainties), the interpretation and implementation of the energy law, expropriation of property rights, political instability and bureaucracy, limited operating history, lack of profitability, high inflation rates, failure to obtain bank financing, fluctuations in currency exchange rates, competition from other businesses, reliance on various factors (including local labour, importation of machinery and other key items and business relationships), risks related to seasonality (including adverse weather conditions, shifting weather patterns, and global warming), a shift in energy trends and demands, a shift in energy generation in the European Union, vulnerability to fluctuations in the world market, the lack of availability of qualified management personnel and stock market volatility. Details of the risk factors relating to Transeastern and its business are discussed under the heading "Risks and Uncertainties" in Transeastern's annual management's discussion & analysis dated May 3, 2017, a copy of which is available on Transeastern's SEDAR profile at www.sedar.com. Most of these factors are outside the control of the Trust. Investors are cautioned not to put undue reliance on forward-looking information. These statements speak only as of the date of this press release. Except as otherwise required by applicable securities statutes or regulation, Transeastern expressly disclaims any intent or obligation to update publicly forward-looking information, whether as a result of new information, future events or otherwise. Neither the TSX Venture Exchange nor its regulation services provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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