Brookfield Renewable Reports Strong Third Quarter Results

Brookfield Renewable Partners L.P.
Brookfield Renewable Partners L.P.

All amounts in U.S. dollars unless otherwise indicated

BROOKFIELD, News, Nov. 03, 2023 (GLOBE NEWSWIRE) -- Brookfield Renewable Partners L.P. (TSX: BEP.UN; NYSE: BEP) (“Brookfield Renewable Partners”, "BEP") today reported financial results for the three and nine months ended September 30, 2023.

“We had another successful quarter, utilizing our disciplined approach to growth and execution to outperform our targets and deliver strong operating results. We recently closed our acquisitions of X-Elio and Deriva Energy (formerly Duke Energy Renewables) and advanced our acquisitions of Westinghouse Electric, which is expected to close shortly, and Origin Energy. By closing several previously announced acquisitions in the fourth quarter of 2023, we are adding significant incremental FFO and positioning ourselves to continue to deliver on our decade long track record of 10%+ FFO per unit annual growth,” said Connor Teskey, CEO Brookfield Renewable. “The prospects for our business are as strong as ever. Our recent investments are performing well and we are seeing historical levels of demand for our product, and with access to capital becoming increasingly scarce for some market participants, we are seeing many opportunities to invest significant capital at very attractive risk-adjusted returns.”

 

 

For the three months ended
September 30

For the nine months ended
September 30

US$ millions (except per unit amounts), unaudited

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Net income (loss) attributable to Unitholders

$

(64

)

$

(136

)

$

(135

)

$

(213

)

– per LP unit(1)

 

(0.14

)

 

(0.25

)

 

(0.34

)

 

(0.44

)

Funds From Operations (FFO)(2)

 

253

 

 

243

 

 

840

 

 

780

 

– per Unit(2)(3)

 

0.38

 

 

0.38

 

 

1.29

 

 

1.21

 


Brookfield Renewable reported FFO of $253 million in the quarter, or $1.29 per unit year-to-date, representing a 7% increase compared to the prior year. The results reflect strong operating activities as we benefit from our highly diversified operating platform, inflation indexed cash flows and development in-line with plan. After deducting non-cash depreciation and other expenses, our Net loss attributable to Unitholders for the three months ended September 30, 2023 was $64 million.

Key highlights:

  • We were successful in our growth activities this quarter, signing transactions for $2.2 billion of equity investment ($450 million net to Brookfield Renewable) alongside our institutional partners, taking advantage of our access to scale capital and opportunities in the market;

  • Continued to advance development activities commissioning approximately 2,200 megawatts of capacity year-to-date and are on track to deliver ~5,000 megawatts this year adding approximately $70 million of annual FFO;

  • We expect to execute just short of $20 billion of non-recourse financing this year, generating over $800 million in upfinancing proceeds to Brookfield Renewable, while maintaining our strong investment grade credit rating and ended the quarter with $4.4 billion of available liquidity, providing significant flexibility to continue executing on our growth and development strategy;

  • Advanced key commercial priorities this quarter including signing contracts to deliver an incremental 5,700 gigawatt hours per year of generation, including 4,100 gigawatt hours to corporate offtakers where we continue to see accelerating demand; and

  • Continued to execute our asset recycling activities where we are seeing strong demand for de-risked assets, generating ~$1.4 billion of proceeds (~$600 million net to Brookfield Renewable) over the past 18-months, which on average represents almost three times our invested capital.

Our returns remain robust

The renewables sector traded down in the public markets on the back of higher interest rates and a perceived tightening of industry margins. Even though we are well positioned to benefit in this environment, and insulated from the challenges that are seemingly impacting others in our sector, we have not been immune to the lower market prices. And while we are never pleased when our share price is down, we are long-term focused investors and we believe the outlook for our business is better than ever. As we continue to deliver on our growth targets and execute on our strategic priorities, our share price should respond and better reflect the intrinsic value of the business.

Most importantly, we are not seeing a reduction in the return we are able to generate on our capital. In fact, quite the opposite, we are seeing plentiful opportunities to deploy capital at or above our target returns, as demand for clean power from corporations continues to accelerate. This opportunity is more pronounced in the current market where access to capital is becoming increasingly scarce for some market participants – creating a favorable environment for those such as ourselves, with the capital, capabilities, and pipeline of projects to deliver for our clients. Notably, there are particularly attractive opportunities to acquire high quality businesses with strong pipelines but lack the access to capital or scale operating capabilities to build out the projects.

In this environment, our ongoing approach to M&A is particularly effective. We are leveraging our existing capabilities and development pipeline to capture the growing demand, while at the same time using our access to capital to add leading platforms in core markets around the world. These additions further enhance our capabilities and position us as the clean energy and decarbonization partner of choice for leading corporations. And by consistently enhancing our business, we expect to be even more well positioned to capture a greater portion of the market demand in the future. It is a powerful and virtuous cycle.

Over the last five years, the amount of clean energy procured annually by corporates has increased almost 10 times and, looking forward, we do not expect this trend to slow down. Access to energy is now the key constraint for a number of these businesses which acquire large amounts of power, including leading global technology companies, to execute their growth plans.

As one of the only scale multi-technology global clean energy businesses in the world with an almost 150,000 megawatt development pipeline, we are uniquely positioned to benefit. With our extensive energy marketing and operational capabilities, our ability to offer 24/7 clean power solutions from our technologically diversified fleet, and our ability to credibly deliver scale projects on time across all key global markets, we have become a go-to partner providing bespoke solutions to meet the needs of the largest procurers of clean energy globally.

As a result, we continue to see a very robust market to contract our capacity and have been successful in signing contracts at prices that appropriately compensate us for higher construction and financing costs. As an example, by leveraging our development pipeline, our existing hydro facilities, and our power marketing capabilities, we recently signed an agreement with one of the leading global tech companies to provide them with a total of 18 terawatt hours (equal to the annual electricity consumption of almost 2 million homes in the U.S.) over the next five years to serve their growing requirements in the U.S.

Our approach to development continues to be focused on delivering appropriate risk-adjusted returns and focusing on investment opportunities that we can de-risk quickly. We do not build on spec and reduce risk in our investments by simultaneously securing power purchase agreements, construction contracts and financing before committing significant capital. We limit construction risk by using a localized approach to construction and development and manage our investment spend by leveraging our central procurement capabilities. Lastly, we leverage our commercial teams to source the highest quality offtakes and focus on the most mature and lowest cost renewable power technologies (solar and onshore wind) in the highest growth regions to ensure our projects produce the most de-risked high quality cash flows. This approach has served us well for decades and allows us to deliver consistent performance in all market conditions.

We are also crystalizing and proving out our returns through our asset recycling initiatives. In the current environment, we continue to see strong demand for de-risked assets with long-term contracts and fixed rate financing in place. As an example, we recently agreed to the sale of a 150-megawatt solar facility in Europe that we commissioned earlier this year for proceeds of $100 million, representing almost three times our invested capital. This marks the continuation of a successful asset recycling program that in the last 18-months has generated ~$1.4 billion of proceeds (~$600 million net to Brookfield Renewable), which on average represents an almost three times multiple of our invested capital. Looking forward, we expect that our capital recycling program will continue to be a key component of our overall source of funds and a means of generating value above our underwriting targets for investors.

We are set to benefit from the closing of a number of highly accretive M&A transactions

We are making good progress closing our previously announced acquisitions. We recently closed the acquisition of 50% of X-Elio, our leading global solar developer, bringing our ownership interest in that business to 100%. We also closed the acquisition of Deriva Energy, one of the largest renewable platforms in the U.S. with 5,900 megawatts of operating and under construction wind, utility scale solar and storage assets, and a 6,100 megawatt development pipeline.

We continued to advance the regulatory approval process for our acquisition of Westinghouse Electric, and we expect to satisfy all conditions to closing this week with closing imminently thereafter. We have also progressed our acquisition of Origin Energy, receiving authorizations from the Australian Competition and Consumer Commission in October, and received a unanimous recommendation from Origin’s board having increased our offer to the top end of their independent expert’s valuation range providing a compelling opportunity for Origin’s shareholders to realize the value of their investment. With the shareholder vote scheduled for late November, we are targeting to close the acquisition in early 2024.

We are also seeing an increasing number of opportunities to acquire scale portfolios and platforms, given the recent move in public market valuations, combined with the increasing need for capital across the sector. This environment plays to our strengths as we can invest at attractive risk-adjusted returns when others are pulling back.

Recently we agreed to acquire Banks Renewables for ~$600 million (~$120 million net to Brookfield Renewable), a leading independent UK renewables developer with ~260 megawatts of onshore wind assets, ~800 megawatts of near-term development and another 3,000 megawatts of later stage projects. We expect the Banks transaction to close prior to year-end. We also agreed to partner with Axis Energy, a leading renewable developer in India with whom we have successfully developed 1,800 megawatts of capacity with over the past two years, creating a new development platform with 1,200 megawatts of advanced stage capacity and another ~5,000 megawatts of projects in the development phase. Under the agreement, we are targeting to invest up to $850 million (up to $170 million net to Brookfield Renewable) over the next 3 years to develop approximately 2,500 megawatts of wind and solar capacity.

In total, over the coming months we expect to have closed transactions totaling $9.2 billion ($1.5 billion net to Brookfield Renewable) of capital that will be immediately accretive adding ~$200 million in expected incremental annual FFO and continuing to grow the value of the business, positioning ourselves to continue to deliver on our decade long track record of 10%+ FFO per unit annual growth.

In light of public market conditions and our strong conviction in the intrinsic value of our business and growth trajectory, we have also started to allocate capital to repurchase shares. Starting this quarter, we repurchased almost 1.5 million units under our normal course issuer bid. Looking forward, we will continue to allocate capital based on where we are seeing the best risk-adjusted returns and remain confident that we will continue to create meaningful value for our investors.

Operating Results

We generated FFO of $253 million, or $0.38 per unit in the third quarter, bringing our year-to-date FFO per unit to $1.29, a 7% increase compared to the prior year. Our business continues to deliver strong results, benefiting from our highly diversified operating platform, inflation indexed cash flows and strong all-in pricing.

Our business is backed by high-quality cash flows, in large part from our perpetual hydro portfolio which generates dispatchable, clean, baseload power that has become increasingly valuable in today’s environment. We are also well positioned to benefit from the increased demand for reliable, carbon-free generation with significant capacity available for re-contracting over the next five years in a very positive environment for prices of electricity. We expect to be able to execute new contracts which will contribute additional FFO and allow us to up-finance many of the assets due to their low levels of debt.

Our hydroelectric segment delivered FFO of $129 million. Our hydro assets globally continue to exhibit strong cash flow resiliency given our increasingly diversified asset base, inflation-linked power purchase agreements, and ability to capture strong power prices.

Our wind and solar segments generated a combined $145 million of FFO. We continue to benefit from contributions from acquisitions and the diversification of our fleet, which is underpinned by long duration power purchase agreements that provide stable revenues. Our distributed energy and sustainable solutions segment generated $39 million of FFO, benefiting from both acquisitions and organic growth across the portfolio.

Our renewable power development pipeline stands at almost 150,000 megawatts, nearly one and half times larger than it was at this time last year. We also continue to be successful starting development on projects earlier than had been planned and scaling our development to meet growing demand for clean power. We have approximately 5,000 megawatts on track for commissioning this year, and ~7,000 and ~8,000 megawatts on track for delivery in 2024 and 2025, respectively. Much of the capital for these projects is already invested, and we will see the returns on that capital when the projects begin producing cash upon commissioning. We expect newly commissioned capacity this year to contribute approximately $70 million in additional FFO annually and commissioned capacity in the following two years to contribute a combined $180 million in additional FFO annually.

Balance Sheet & Liquidity

Our financial position remains excellent, and our available liquidity is robust, providing significant flexibility to fund our growth. We are resilient to rising global interest rates, with ~90% of our borrowings being project level non-recourse debt, with an average remaining term of over 10 years, no material near-term maturities in the next five years, and only 3% exposure to floating rate debt.

Despite market volatility, we continue to have access to deep and varied pools of capital, differentiating our business. We finished the quarter with $4.4 billion of available liquidity, giving us significant optionality during periods of capital scarcity. So far this year, we have secured over $10 billion of non-recourse financing across the business and expect to raise an additional $8 billion in non-recourse financing by year-end, generating over $800 million in total upfinancing proceeds to Brookfield Renewable for the year.

Distribution Declaration

The next quarterly distribution in the amount of $0.3375 per LP unit, is payable on December 29, 2023 to unitholders of record as at the close of business on November 30, 2023. In conjunction with the Partnership’s distribution declaration, the Board of Directors of BEPC has declared an equivalent quarterly dividend of $0.3375 per share, also payable on December 29, 2023 to shareholders of record as at the close of business on November 30, 2023. Brookfield Renewable targets a sustainable distribution with increases targeted on average at 5% to 9% annually.

The quarterly dividends on BEP's preferred shares and preferred LP units have also been declared.

Distribution Currency Option

The quarterly distributions payable on the BEP units and BEPC shares are declared in U.S. dollars. Unitholders who are residents in the United States will receive payment in U.S. dollars and unitholders who are residents in Canada will receive the Canadian dollar equivalent unless they request otherwise. The Canadian dollar equivalent of the quarterly distribution will be based on the Bank of Canada daily average exchange rate on the record date or, if the record date falls on a weekend or holiday, on the Bank of Canada daily average exchange rate of the preceding business day.

Registered unitholders who are residents in Canada who wish to receive a U.S. dollar distribution and registered unitholders who are residents in the United States wishing to receive the Canadian dollar distribution equivalent should contact Brookfield Renewable’s transfer agent, Computershare Trust Company of Canada, in writing at 100 University Avenue, 8th Floor, Toronto, Ontario M5J 2Y1 or by phone at 1-800-564-6253. Beneficial unitholders (i.e., those holding their units in street name with their brokerage) should contact the broker with whom their units are held.

Distribution Reinvestment Plan

Brookfield Renewable Partners maintains a Distribution Reinvestment Plan (“DRIP”) which allows holders of BEP units who are residents in Canada to acquire additional LP units by reinvesting all or a portion of their cash distributions without paying commissions. Information on the DRIP, including details on how to enroll, is available on our website at www.bep.brookfield.com/stock-and-distribution/distributions/drip.

Additional information on Brookfield Renewable’s distributions and preferred share dividends can be found on our website at www.bep.brookfield.com.

Brookfield Renewable

Brookfield Renewable operates one of the world’s largest publicly traded, pure-play renewable power platforms. Our portfolio consists of hydroelectric, wind, utility-scale solar and storage facilities in North America, South America, Europe and Asia, and totals approximately 31,500 megawatts of installed capacity and a development pipeline of approximately 143,400 megawatts of renewable power assets, 14 million metric tonnes per annum ("MMTPA") of carbon capture and storage, 2 million tons of recycled material and 4 million metric million British thermal units of renewable natural gas production annually. Investors can access its portfolio either through Brookfield Renewable Partners L.P. (NYSE: BEP; TSX: BEP.UN), a Bermuda-based limited partnership, or Brookfield Renewable Corporation (NYSE, TSX: BEPC), a Canadian corporation. Further information is available at https://bep.brookfield.com. Important information may be disseminated exclusively via the website; investors should consult the site to access this information.

Brookfield Renewable is the flagship listed renewable power company of Brookfield Asset Management, a leading global alternative asset manager with approximately $850 billion of assets under management.

Please note that Brookfield Renewable’s previous audited annual and unaudited quarterly reports filed with the U.S. Securities and Exchange Commission (“SEC”) and securities regulators in Canada, are available on our website at https://bep.brookfield.com, on SEC’s website at www.sec.gov and on SEDAR’s website at www.sedar.com. Hard copies of the annual and quarterly reports can be obtained free of charge upon request.

Contact information:

 

Media:

Investors:

Simon Maine

Alex Jackson

Managing Director – Communications

Vice President – Investor Relations

+44 (0)7398 909 278

(416)-649-8196

simon.maine@brookfield.com

alexander.jackson@brookfield.com

 

 

Quarterly Earnings Call Details

Investors, analysts and other interested parties can access Brookfield Renewable’s Third Quarter 2023 Results as well as the Letter to Unitholders and Supplemental Information on Brookfield Renewable’s website at https://bep.brookfield.com.

The conference call can be accessed via webcast on November 3, 2023 at 8:30 a.m. Eastern Time at https://edge.media-server.com/mmc/p/8qxc5kd9

Brookfield Renewable Partners L.P.

Consolidated Statements of Financial Position

 

As of

UNAUDITED
(MILLIONS)

September 30

December 31

2023

2022

Assets

 

 

 

 

Cash and cash equivalents

 

$

1,034

 

$

998

Trade receivables and other financial assets(5)

 

 

3,805

 

 

3,747

Equity-accounted investments

 

 

1,707

 

 

1,392

Property, plant and equipment, at fair value

 

 

56,437

 

 

54,283

Goodwill, deferred income tax and other assets(6)

 

 

2,580

 

 

3,691

Total Assets

 

$

65,563

 

$

64,111

 

 

 

 

 

Liabilities

 

 

 

 

Corporate borrowings(7)

 

$

2,712

 

$

2,548

Borrowings which have recourse only to assets they finance(8)

 

 

21,659

 

 

22,302

Accounts payable and other liabilities(9)

 

 

5,942

 

 

6,468

Deferred income tax liabilities

 

 

6,931

 

 

6,507

 

 

 

 

 

Equity

 

 

 

 

Non-controlling interests

 

 

 

 

Participating non-controlling interests – in operating subsidiaries

$

16,770

 

$

14,755

 

General partnership interest in a holding subsidiary held by Brookfield

 

57

 

 

59

 

Participating non-controlling interests – in a holding subsidiary – Redeemable/Exchangeable units held by Brookfield

 

2,809

 

 

2,892

 

BEPC exchangeable shares

 

2,595

 

 

2,561

 

Preferred equity

 

570

 

 

571

 

Perpetual subordinated notes

 

592

 

 

592

 

Preferred limited partners' equity

 

760

 

 

760

 

Limited partners' equity

 

4,166

 

28,319

 

4,096

 

26,286

Total Liabilities and Equity

 

$

65,563

 

$

64,111

.

Brookfield Renewable Partners L.P.

Consolidated Statements of Operating Results

UNAUDITED

For the three months ended
September 30

 

For the nine months ended
September 30

(MILLIONS, EXCEPT AS NOTED)

 

2023

 

 

2022

 

 

 

2023

 

 

2022

 

Revenues

$

1,179

 

$

1,105

 

 

$

3,715

 

$

3,515

 

Other income

 

116

 

 

22

 

 

 

203

 

 

107

 

Direct operating costs(10)

 

(496

)

 

(344

)

 

 

(1,322

)

 

(1,060

)

Management service costs

 

(43

)

 

(58

)

 

 

(155

)

 

(199

)

Interest expense

 

(370

)

 

(313

)

 

 

(1,166

)

 

(873

)

Share of earnings from equity-accounted investments

 

 

 

12

 

 

 

46

 

 

60

 

Foreign exchange and financial instrument (loss) gain

 

113

 

 

(70

)

 

 

432

 

 

(119

)

Depreciation

 

(448

)

 

(385

)

 

 

(1,335

)

 

(1,175

)

Other

 

(6

)

 

(54

)

 

 

(2

)

 

(108

)

Income tax recovery (expense)

 

 

 

 

 

Current

 

(9

)

 

(33

)

 

 

(89

)

 

(106

)

Deferred

 

(12

)

 

41

 

 

 

25

 

 

36

 

Net income (loss)

$

24

 

$

(77

)

 

$

352

 

$

78

 

Net income attributable to preferred equity, preferred limited partners' equity, perpetual subordinated notes and non-controlling interests in operating subsidiaries

$

(88

)

$

(59

)

 

$

(487

)

$

(291

)

Net (loss) income attributable to Unitholders

 

(64

)

 

(136

)

 

 

(135

)

 

(213

)

Basic and diluted loss per LP unit

$

(0.14

)

$

(0.25

)

 

$

(0.34

)

$

(0.44

)


Brookfield Renewable Partners L.P.

Consolidated Statements of Cash Flows

 

 

 

 

 

 

 

For the three months ended
September 30

 

For the nine months ended
September 30

UNAUDITED
(MILLIONS)

2023

2022

 

2023

2022

Operating activities

 

 

 

 

 

Net income

$

24

 

$

(77

)

 

$

352

 

$

78

 

Adjustments for the following non-cash items:

 

 

 

 

 

Depreciation

 

448

 

 

385

 

 

 

1,335

 

 

1,175

 

Unrealized foreign exchange and financial instrument loss (gain)

 

(144

)

 

116

 

 

 

(410

)

 

222

 

Share of earnings from equity-accounted investments

 

 

 

(12

)

 

 

(46

)

 

(60

)

Deferred income tax (expense) recovery

 

12

 

 

(41

)

 

 

(25

)

 

(36

)

Other non-cash items

 

(62

)

 

56

 

 

 

(48

)

 

68

 

 

 

278

 

 

427

 

 

 

1,158

 

 

1,447

 

Net change in working capital and other(11)

 

85

 

 

(33

)

 

 

250

 

 

(312

)

 

 

363

 

 

394

 

 

 

1,408

 

 

1,135

 

Financing activities

 

 

 

 

 

Net corporate borrowings

 

 

 

 

 

 

293

 

 

 

Corporate credit facilities, net

 

 

 

200

 

 

 

 

 

200

 

Non-recourse borrowings, commercial paper, and related party borrowings, net

 

166

 

 

1,108

 

 

 

(890

)

 

3,463

 

Capital contributions from participating non-controlling interests – in operating subsidiaries, net

 

371

 

 

64

 

 

 

1,952

 

 

338

 

Issuance (redemption) of equity instruments, net and related costs

 

(12

)

 

 

 

 

618

 

 

(137

)

Distributions paid:

 

 

 

 

 

To participating non-controlling interests - in operating subsidiaries

 

(265

)

 

(252

)

 

 

(714

)

 

(1,109

)

To unitholders of Brookfield Renewable or BRELP

 

(250

)

 

(228

)

 

 

(739

)

 

(686

)

 

 

10

 

 

892

 

 

 

520

 

 

2,069

 

Investing activities

 

 

 

 

 

Acquisitions net of cash and cash equivalents in acquired entity

 

 

 

(602

)

 

 

(87

)

 

(1,381

)

Investment in property, plant and equipment

 

(604

)

 

(577

)

 

 

(1,660

)

 

(1,478

)

Disposal (purchase) of associates and other assets

 

87

 

 

(43

)

 

 

(131

)

 

(102

)

Restricted cash and other

 

(13

)

 

38

 

 

 

(28

)

 

38

 

 

 

(530

)

 

(1,184

)

 

 

(1,906

)

 

(2,923

)

Foreign exchange gain (loss) on cash

 

(16

)

 

(30

)

 

 

14

 

 

(50

)

Cash and cash equivalents

 

 

 

 

 

Decrease (increase)

 

(173

)

 

72

 

 

 

36

 

 

231

 

Net change in cash classified within assets held for sale

 

5

 

 

 

 

 

 

 

 

Balance, beginning of period

 

1,202

 

 

1,059

 

 

 

998

 

 

900

 

Balance, end of period

$

1,034

 

$

1,131

 

 

$

1,034

 

$

1,131

 


PROPORTIONATE RESULTS FOR THE THREE MONTHS ENDED
SEPTEMBER 30

The following chart reflects the generation and summary financial figures on a proportionate basis for the three months ended September 30:

 

(GWh)

 

 

(MILLIONS)

 

Actual Generation

 

 

LTA Generation

 

 

Revenues

 

 

Adjusted EBITDA

 

 

FFO

 

2023

2022

 

 

2023

2022

 

 

2023

2022

 

 

2023

2022

 

 

2023

2022

Hydroelectric

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

North America

2,543

2,236

 

 

2,445

2,445

 

 

$

221

$

212

 

 

$

138

$

127

 

 

$

75

 

$

76

 

Brazil

813

849

 

 

1,035

1,035

 

 

 

62

 

49

 

 

 

45

 

40

 

 

 

38

 

 

31

 

Colombia

705

1,092

 

 

892

924

 

 

 

74

 

65

 

 

 

39

 

45

 

 

 

16

 

 

23

 

 

4,061

4,177

 

 

4,372

4,404

 

 

 

357

 

326

 

 

 

222

 

212

 

 

 

129

 

 

130

 

Wind

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

North America

742

725

 

 

941

908

 

 

 

64

 

70

 

 

 

93

 

46

 

 

 

74

 

 

28

 

Europe

161

179

 

 

162

190

 

 

 

14

 

19

 

 

 

9

 

23

 

 

 

4

 

 

20

 

Brazil

190

197

 

 

247

210

 

 

 

12

 

10

 

 

 

11

 

9

 

 

 

9

 

 

7

 

Asia

189

148

 

 

225

154

 

 

 

13

 

10

 

 

 

10

 

9

 

 

 

7

 

 

6

 

 

1,282

1,249

 

 

1,575

1,462

 

 

 

103

 

109

 

 

 

123

 

87

 

 

 

94

 

 

61

 

Utility-scale solar

689

569

 

 

882

773

 

 

 

83

 

104

 

 

 

75

 

114

 

 

 

51

 

 

86

 

Distributed energy & sustainable solutions(12)

501

445

 

 

283

266

 

 

 

80

 

80

 

 

 

50

 

52

 

 

 

39

 

 

43

 

Corporate

 

 

 

 

 

 

 

 

 

37

 

30

 

 

 

(60

)

 

(77

)

Total

6,533

6,440

 

 

7,112

6,905

 

 

$

623

$

619

 

 

$

507

$

495

 

 

$

253

 

$

243

 


PROPORTIONATE RESULTS FOR THE
NINE MONTHS ENDED SEPTEMBER 30

The following chart reflects the generation and summary financial figures on a proportionate basis for the nine months ended September 30:

 

(GWh)

 

 

(MILLIONS)

 

Actual Generation

 

 

LTA Generation

 

 

Revenues

 

 

Adjusted EBITDA

 

 

FFO

 

2023

2022

 

 

2023

2022

 

 

2023

2022

 

 

2023

2022

 

 

2023

2022

Hydroelectric

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

North America

9,147

8,858

 

 

9,247

9,251

 

 

$

830

$

745

 

 

$

549

$

472

 

 

$

347

 

$

325

 

Brazil

3,082

2,868

 

 

3,063

3,040

 

 

 

181

 

142

 

 

 

132

 

127

 

 

 

112

 

 

100

 

Colombia

2,619

3,189

 

 

2,652

2,738

 

 

 

206

 

205

 

 

 

134

 

143

 

 

 

60

 

 

84

 

 

14,848

14,915

 

 

14,962

15,029

 

 

 

1,217

 

1,092

 

 

 

815

 

742

 

 

 

519

 

 

509

 

Wind

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

North America

2,793

2,927

 

 

3,468

3,264

 

 

 

222

 

241

 

 

 

238

 

160

 

 

 

185

 

 

110

 

Europe

587

633

 

 

643

682

 

 

 

89

 

102

 

 

 

73

 

102

 

 

 

57

 

 

89

 

Brazil

472

424

 

 

561

503

 

 

 

29

 

23

 

 

 

24

 

19

 

 

 

19

 

 

14

 

Asia

562

436

 

 

688

426

 

 

 

36

 

29

 

 

 

29

 

25

 

 

 

19

 

 

16

 

 

4,414

4,420

 

 

5,360

4,875

 

 

 

376

 

395

 

 

 

364

 

306

 

 

 

280

 

 

229

 

Utility-scale solar

1,836

1,464

 

 

2,296

1,859

 

 

 

281

 

297

 

 

 

251

 

308

 

 

 

168

 

 

224

 

Distributed energy & sustainable solutions(13)

1,218

1,044

 

 

767

708

 

 

 

240

 

207

 

 

 

169

 

147

 

 

 

136

 

 

118

 

Corporate

 

 

 

 

 

 

 

 

 

53

 

38

 

 

 

(263

)

 

(300

)

Total

22,316

21,843

 

 

23,385

22,471

 

 

$

2,114

$

1,991

 

 

$

1,652

$

1,541

 

 

$

840

 

$

780

 


RECONCILIATION OF NON-IFRS MEASURES

The following table reflects Adjusted EBITDA and provides a reconciliation from Net income (loss) to Adjusted EBITDA for the three months ended September 30, 2023:

 

Attributable to Unitholders

(MILLIONS)

Hydroelectric


Wind


Utility-
scale
solar

Distributed energy
& sustainable
solutions

Corporate


Total


Net income (loss)

$

25

 

$

60

 

$

26

 

$

(11

)

$

(76

)

$

24

 

Add back or deduct the following:

 

 

 

 

 

 

Depreciation

 

165

 

 

164

 

 

83

 

 

35

 

 

1

 

 

448

 

Deferred income tax expense (recovery)

 

(27

)

 

49

 

 

(17

)

 

4

 

 

3

 

 

12

 

Foreign exchange and financial instrument loss (gain)

 

(7

)

 

(74

)

 

(29

)

 

(22

)

 

19

 

 

(113

)

Other(14)

 

3

 

 

19

 

 

(14

)

 

17

 

 

(17

)

 

8

 

Management service costs

 

 

 

 

 

 

 

 

 

43

 

 

43

 

Interest expense

 

184

 

 

64

 

 

53

 

 

43

 

 

26

 

 

370

 

Current income tax expense

 

8

 

 

3

 

 

(4

)

 

 

 

2

 

 

9

 

Amount attributable to equity accounted investments and non-controlling interests(15)

 

(129

)

 

(162

)

 

(23

)

 

(16

)

 

36

 

 

(294

)

Adjusted EBITDA

$

222

 

$

123

 

$

75

 

$

50

 

$

37

 

$

507

 


The following table reflects Adjusted EBITDA and provides a reconciliation from Net income (loss) to Adjusted EBITDA for the three months ended September 30, 2022:

 

Attributable to Unitholders

(MILLIONS)

Hydroelectric


Wind


Utility-
scale
solar

District energy
& sustainable
solutions

Corporate


Total


Net income (loss)

$

(20

)

$

(23

)

$

25

 

$

25

 

$

(84

)

$

(77

)

Add back or deduct the following:

 

 

 

 

 

 

Depreciation

 

150

 

 

135

 

 

69

 

 

31

 

 

 

 

385

 

Deferred income tax expense (recovery)

 

(29

)

 

9

 

 

(2

)

 

2

 

 

(21

)

 

(41

)

Foreign exchange and financial instrument loss (gain)

 

115

 

 

(39

)

 

(7

)

 

1

 

 

 

 

70

 

Other(14)

 

3

 

 

42

 

 

48

 

 

10

 

 

63

 

 

166

 

Management service costs

 

 

 

 

 

 

 

 

 

58

 

 

58

 

Interest expense

 

152

 

 

66

 

 

47

 

 

20

 

 

28

 

 

313

 

Current income tax expense

 

28

 

 

2

 

 

2

 

 

1

 

 

 

 

33

 

Amount attributable to equity accounted investments and non-controlling interests(15)

 

(187

)

 

(105

)

 

(68

)

 

(38

)

 

(14

)

 

(412

)

Adjusted EBITDA

$

212

 

$

87

 

$

114

 

$

52

 

$

30

 

$

495

 


RECONCILIATION OF NON-IFRS MEASURES

The following table reflects Adjusted EBITDA and provides a reconciliation to net income (loss) to Adjusted EBITDA for the nine months ended September 30, 2023:

 

Attributable to Unitholders

(MILLIONS)

Hydroelectric


Wind


Utility-
scale
solar

Distributed energy
& sustainable
solutions

Corporate


Total


Net income (loss)

$

356

 

$

165

 

$

19

 

$

68

 

$

(256

)

$

352

 

Add back or deduct the following:

 

 

 

 

 

 

Depreciation

 

482

 

 

494

 

 

250

 

 

107

 

 

2

 

 

1,335

 

Deferred income tax expense (recovery)

 

(28

)

 

59

 

 

(12

)

 

(18

)

 

(26

)

 

(25

)

Foreign exchange and financial instrument loss (gain)

 

(107

)

 

(189

)

 

(55

)

 

(72

)

 

(9

)

 

(432

)

Other(14)

 

21

 

 

38

 

 

(13

)

 

41

 

 

8

 

 

95

 

Management service costs

 

 

 

 

 

 

 

 

 

155

 

 

155

 

Interest expense

 

560

 

 

212

 

 

186

 

 

107

 

 

101

 

 

1,166

 

Current income tax expense

 

67

 

 

13

 

 

7

 

 

 

 

2

 

 

89

 

Amount attributable to equity accounted investments and non-controlling interests(15)

 

(536

)

 

(428

)

 

(131

)

 

(64

)

 

52

 

 

(1,107

)

Adjusted EBITDA

$

815

 

$

364

 

$

251

 

$

169

 

$

29

 

$

1,628

 


The following table reflects Adjusted EBITDA and provides a reconciliation to net income (loss) to Adjusted EBITDA for the nine months ended September 30, 2022:

 

Attributable to Unitholders

(MILLIONS)

Hydroelectric


Wind


Utility-
scale
solar

District energy
& sustainable
solutions

Corporate


Total


Net income (loss)

$

198

 

$

(24

)

$

34

 

$

87

 

$

(217

)

$

78

 

Add back or deduct the following:

 

 

 

 

 

 

Depreciation

 

461

 

 

417

 

 

203

 

 

92

 

 

2

 

 

1,175

 

Deferred income tax expense (recovery)

 

(14

)

 

41

 

 

(9

)

 

2

 

 

(56

)

 

(36

)

Foreign exchange and financial instrument loss (gain)

 

200

 

 

(63

)

 

10

 

 

(8

)

 

(20

)

 

119

 

Other(14)

 

8

 

 

74

 

 

102

 

 

17

 

 

77

 

 

278

 

Management service costs

 

 

 

 

 

 

 

 

 

199

 

 

199

 

Interest expense

 

420

 

 

188

 

 

133

 

 

55

 

 

77

 

 

873

 

Current income tax expense

 

92

 

 

8

 

 

5

 

 

1

 

 

 

 

106

 

Amount attributable to equity accounted investments and non-controlling interests(15)

 

(623

)

 

(335

)

 

(170

)

 

(99

)

 

(24

)

 

(1,251

)

Adjusted EBITDA

$

742

 

$

306

 

$

308

 

$

147

 

$

38

 

$

1,541

 


The following table reconciles the non-IFRS financial metrics to the most directly comparable IFRS measures. Net income is reconciled to Funds From Operations:

 

For the three months ended
September 30

For the nine months ended
September 30

UNAUDITED
(MILLIONS)


2023


2022


2023


2022

Net income

$

24

 

$

(77

)

$

352

 

$

78

 

Add back or deduct the following:

 

 

 

 

Depreciation

 

448

 

 

385

 

 

1,335

 

 

1,175

 

Deferred income tax recovery

 

12

 

 

(41

)

 

(25

)

 

(36

)

Foreign exchange and financial instruments gain (loss)

 

(113

)

 

70

 

 

(432

)

 

119

 

Other(16)

 

8

 

 

166

 

 

119

 

 

278

 

Amount attributable to equity accounted investment and non-controlling interest(17)

 

(126

)

 

(260

)

 

(509

)

 

(834

)

Funds From Operations

$

253

 

$

243

 

$

840

 

$

780

 

Normalized long-term average generation adjustment

 

55

 

 

45

 

 

136

 

 

103

 

Normalized foreign currency adjustment

 

(7

)

 

 

 

5

 

 

 

Normalized Funds From Operations

$

301

 

$

288

 

$

981

 

$

883

 


The following table reconciles the per Unit non-IFRS financial metrics to the most directly comparable IFRS measures. Net income per LP unit is reconciled to Funds From Operations:

 

For the three months ended
September 30

For the nine months ended
September 30

 

2023

2022

2023

2022

Net income (loss) per LP unit(1)

$

(0.14

)

$

(0.25

)

$

(0.34

)

$

(0.44

)

Adjust for the proportionate share of

 

 

 

 

Depreciation

 

0.38

 

 

0.36

 

 

1.14

 

 

1.10

 

Deferred income tax recovery and other

 

0.20

 

 

0.11

 

 

0.68

 

 

0.33

 

Foreign exchange and financial instruments loss (gain)

 

(0.06

)

 

0.16

 

 

(0.19

)

 

0.22

 

Funds From Operations per Unit(3)

$

0.38

 

$

0.38

 

$

1.29

 

$

1.21

 

Normalized long-term average generation adjustment

 

0.08

 

 

0.07

 

 

0.21

 

 

0.16

 

Normalized foreign exchange adjustment

 

(0.01

)

 

 

 

 

 

 

Normalized Funds From Operations per Unit(3)

$

0.45

 

$

0.45

 

$

1.50

 

$

1.37

 


BROOKFIELD RENEWABLE CORPORATION REPORTS

THIRD QUARTER RESULTS

All amounts in U.S. dollars unless otherwise indicated

The Board of Directors of Brookfield Renewable Corporation ("BEPC" or our "company") (NYSE, TSX: BEPC) today has declared a quarterly dividend of $0.3375 per class A exchangeable subordinate voting share of BEPC (a "Share"), payable on December 29, 2023 to shareholders of record as at the close of business on November 30, 2023. This dividend is identical in amount per share and has identical record and payment dates to the quarterly distribution announced today by BEP on BEP's LP units.

The BEPC exchangeable shares are structured with the intention of being economically equivalent to the non-voting limited partnership units of Brookfield Renewable Partners L.P. ("BEP" or the "Partnership") (NYSE: BEP; TSX: BEP.UN). We believe economic equivalence is achieved through identical dividends and distributions on the BEPC exchangeable shares and BEP's LP units and each BEPC exchangeable share being exchangeable at the option of the holder for one BEP LP unit at any time. Given the economic equivalence, we expect that the market price of the Shares will be significantly impacted by the market price of BEP's LP units and the combined business performance of our company and BEP as a whole. In addition to carefully considering the disclosures made in this news release in its entirety, shareholders are strongly encouraged to carefully review BEP's continuous disclosure filings available electronically on EDGAR on the SEC's website at www.sec.gov or on SEDAR at www.sedar.com.

 

For the three months ended
September 30

 

For the nine months ended
September 30

US$ millions (except per unit amounts), unaudited

2023

2022

 

2023

2022

Select Financial Information

 

 

 

 

 

Net income (loss) attributable to the partnership

$

1,340

$

480

 

$

566

$

550

Funds From Operations (FFO)(2)

 

151

 

139

 

 

548

 

473


BEPC reported FFO of $151 million for the three months ended September 30, 2023 compared to $139 million in the prior year. After deducting non-cash depreciation, remeasurement of the BEPC exchangeable and class B shares, and other non-cash items our Net loss attributable to the partnership for the three months ended September 30, 2023 was $1,340 million.

Brookfield Renewable Corporation

Consolidated Statements of Financial Position

 

As of

UNAUDITED
(MILLIONS)

September 30

December 31

2023

2022

Assets

 

 

 

 

Cash and cash equivalents

 

$

513

 

$

642

Trade receivables and other financial assets(5)

 

 

2,545

 

 

2,567

Equity-accounted investments

 

 

554

 

 

451

Property, plant and equipment, at fair value

 

 

39,205

 

 

37,828

Goodwill, deferred income tax and other assets(6)

 

 

984

 

 

1,800

Total Assets

 

$

43,801

 

$

43,288

 

 

 

 

 

Liabilities

 

 

 

 

Borrowings which have recourse only to assets they finance(8)

 

$

13,770

 

$

13,715

Accounts payable and other liabilities(9)

 

 

2,628

 

 

3,122

Deferred income tax liabilities

 

 

5,740

 

 

5,263

 

 

 

 

 

BEPC exchangeable and class B shares

 

 

3,905

 

 

4,364

 

 

 

 

 

Equity

 

 

 

 

Non-controlling interests:

 

 

 

 

Participating non-controlling interests – in operating subsidiaries

$

10,809

 

$

10,680

 

Participating non-controlling interests – in a holding subsidiary held by the partnership

 

273

 

 

271

 

The partnership

 

6,676

 

17,758

 

5,873

 

16,824

Total Liabilities and Equity

 

$

43,801

 

$

43,288


Brookfield Renewable Corporation

Consolidated Statements of Income (Loss)

 

 

 

 

 

UNAUDITED
(MILLIONS)

 

For the three months ended
September 30

 

For the nine months ended
September 30

 

2023

2022

 

2023

2022

 

 

 

 

 

 

 

Revenues

 

$

934

 

$

896

 

 

$

2,901

 

$

2,822

 

Other income

 

 

95

 

 

9

 

 

 

147

 

 

79

 

Direct operating costs(10)

 

 

(388

)

 

(293

)

 

 

(1,000

)

 

(880

)

Management service costs

 

 

(26

)

 

(37

)

 

 

(94

)

 

(132

)

Interest expense

 

 

(308

)

 

(264

)

 

 

(929

)

 

(747

)

Share of (loss) earnings from equity-accounted investments

 

 

(7

)

 

2

 

 

 

(7

)

 

1

 

Foreign exchange and financial instrument gain (loss)

 

 

21

 

 

(68

)

 

 

129

 

 

(98

)

Depreciation

 

 

(320

)

 

(288

)

 

 

(953

)

 

(870

)

Other

 

 

3

 

 

(28

)

 

 

14

 

 

(54

)

Remeasurement of BEPC exchangeable and class B shares

 

 

1,393

 

 

603

 

 

 

710

 

 

774

 

Income tax (expense) recovery

 

 

 

 

 

 

Current

 

 

(7

)

 

(31

)

 

 

(79

)

 

(98

)

Deferred

 

 

(20

)

 

16

 

 

 

(29

)

 

(25

)

Net income

 

$

1,370

 

$

517

 

 

$

810

 

$

772

 

Net income (loss) attributable to:

 

 

 

 

 

 

Non-controlling interests:

 

 

 

 

 

 

Participating non-controlling interests – in operating subsidiaries

 

$

29

 

$

35

 

 

$

240

 

$

215

 

Participating non-controlling interests – in a holding subsidiary held by the partnership

 

 

1

 

 

2

 

 

 

4

 

 

7

 

The partnership

 

 

1,340

 

 

480

 

 

 

566

 

 

550

 

 

 

$

1,370

 

$

517

 

 

$

810

 

$

772

 


Brookfield Renewable Corporation

Consolidated Statements of Cash Flows

 

 

 

 

 

 

UNAUDITED
(MILLIONS)

For the three months ended
September 30

 

For the nine months ended
September 30

2023

2022

 

2023

2022

Operating activities

 

 

 

 

 

Net income (loss)

$

1,370

 

$

517

 

 

$

810

 

$

772

 

Adjustments for the following non-cash items:

 

 

 

 

 

Depreciation

 

320

 

 

288

 

 

 

953

 

 

870

 

Unrealized foreign exchange and financial instruments loss (gain)

 

(27

)

 

128

 

 

 

(119

)

 

212

 

Share of earnings from equity-accounted investments

 

7

 

 

(2

)

 

 

7

 

 

(1

)

Deferred income tax expense (recovery)

 

20

 

 

(16

)

 

 

29

 

 

25

 

Other non-cash items

 

(56

)

 

15

 

 

 

(27

)

 

10

 

Remeasurement of exchangeable and class B shares

 

(1,393

)

 

(603

)

 

 

(710

)

 

(774

)

 

 

241

 

 

327

 

 

 

943

 

 

1,114

 

Net change in working capital and other(11)

 

47

 

 

(37

)

 

 

189

 

 

(249

)

 

 

288

 

 

290

 

 

 

1,132

 

 

865

 

Financing activities

 

 

 

 

 

Non-recourse borrowings and related party borrowings, net

 

(196

)

 

201

 

 

 

(822

)

 

866

 

Capital contributions from participating non-controlling interests

 

32

 

 

88

 

 

 

135

 

 

284

 

Return of capital to participating non-controlling interests

 

(30

)

 

(54

)

 

 

(30

)

 

(54

)

Issuance of exchangeable shares, net

 

 

 

 

 

 

251

 

 

 

Distributions paid and return of capital:

 

 

 

 

 

To participating non-controlling interests

 

(116

)

 

(251

)

 

 

(437

)

 

(1,058

)

To the partnership

 

 

 

 

 

 

 

 

 

 

 

(310

)

 

(16

)

 

 

(903

)

 

38

 

Investing activities

 

 

 

 

 

Acquisitions net of cash and cash equivalents in acquired entity

 

 

 

 

 

 

(81

)

 

 

Investment in equity-accounted investments

 

(4

)

 

(48

)

 

 

(7

)

 

(48

)

Investment in property, plant and equipment