Boston, MA 05/22/2014 (wallstreetpr) – Calpine Corporation (NYSE:CPN) reported first quarter 2014 results with adjusted EBITDA of $446 million and adjusted free cash flow of $130 million.
Improved profitability
Calpine increased the power generation capacity during the quarter as it acquired Guadalupe Energy Center in February 2014 and commenced operations in Russell City and Los Esteros power plants during 3Q2013. In addition, higher regulated capacity revenue from the Northern plants and strong market conditions as a result of extreme weather increased the commodity margin by $184 million.
Therefore, the Company’s adjusted EBITDA increased to $446 million (1Q2013: $286 million) and adjusted free cash flow rose to $130 million in the first quarter compared to the cash used of $43 million in 1Q2013.
Accordingly, it improved the bottom line with positive earnings with adjusted net income of $55 million compared to the net loss of $70 million in 1Q2013. The increasing net income offset the higher production costs and lower tax benefit.
Cash flow and liquidity
During 1Q2014, Calpine ended up with net cash inflows of $123 million versus net cash outflows $157 million in 1Q2013 as a result of increasing income from its operation and lower change in working capital.
Calpine Corporation (NYSE:CPN) used $769 million cash in investing activities (1Q2013: $122 million) due to higher cash outflows ($656 million) related to the acquisition of Guadalupe Energy Center in 2014.
Cash flows from financing were $220 million despite $65 million more cash used in share repurchase as the Company received $420 million from the issuance of CCFC Term Loans to fund Guadalupe Energy transaction.
As of March 31, 2014, Calpine has a liquidity of ~$1.6 billion, including cash and cash equivalents of $515 million and net debt of $10.9 billion. The leverage ratio (net debt/adjusted EBITDA) as of March 31, 2014 was 5.2x.
Outlook
Calpine Corporation (NYSE:CPN) expects growth in earnings with the expansion of completion of Deer Park and Channel Energy Center, and Garrison Energy Center and anticipates adjusted EBITDA of $1.9 – $2 billion with adjusted of $785-$885 million.
