Boston, MA 05/09/2014 (wallstreetpr) – Dynegy Inc. (NYSE:DYN) starts the year 2014 with a profit in its first quarter with adjusted EBITDA of $152 million on revenue of $762 million. The Company also raised the guidance for FY2014.
First quarter review
Dynergy’s revenues were up significantly to $762 million; 1.4 times than the revenues a year’s ego as a result of high realized prices and higher productions across all segments. The market improvement, IPH acquisition and PRIDE Reloaded program drove the Company’s adjusted EBITDA to $152 million from $43 million in the first quarter 2013. The $109 million increase was mainly due to the contribution of $42 million from coal and $104 million from gas segment and $30 million from IPH acquisition.
High realized prices improved the Coal segment’s adjusted EBITDA from $4 million to $42 million. High production and spark spreads and increase in revenues from ancillary services drove the Gas segment’s adjusted EBITDA to $104 million from $61 million in 1Q2013.
Cash flow and liquidity
During 1Q2014, Dynegy Inc. (NYSE:DYN) generated $166 million cash from its operation as a result of positive changes in working capital. Capital spending during the period was ~$12 million. With the addition of $268 million of cash from IPH segment, Dynergy’s available liquidity increased to $1.3 billion as of March 31, 2014.
Upcoming opportunity
In several key markets, the trends continue as most of existing production capacity is gradually retiring and the inventory for natural gas is low. As a result, the market expects for more capacity addition so to meet the requirements. Moreover, the expected improvement in energy prices in 2015 and 2016 will further create opportunity to generate and address the market demand.
Considering the market trend, Dynegy Inc. (NYSE:DYN) expects to improve its operational efficiencies and cash flow to create value for its shareholders through its PRIDE Reloaded program and anticipates operational growth of $135 million and balance sheet by $165 million in next three years. Consequently, Dynegy Inc. (NYSE:DYN) expects to increase its adjusted EBITDA to $300-350 million and free cash flow of $10-60 million in FY2014.
