RENO, NV--(Marketwired - March 30, 2015) - Ram Power, Corp. (TSX: RPG) ("Ram Power" or the "Company"), a renewable energy company focused on the development, production and sale of electricity from geothermal energy, is pleased to announce its operating results for the year ended December 31, 2014. This earnings release should be read in conjunction with Ram Power's financial statements, and management's discussion and analysis ("MD&A"), which are available on the Company's website at www.ram-power.com and have been posted on SEDAR at www.sedar.com.
San Jacinto-Tizate Project Overview
- The San Jacinto-Tizate Power Plant generated 429,740 (net) MWh resulting in revenue of $48.1 million for the year ended December 31, 2014 (an increase of 4% over the same period in 2013) compared to revenue of $46.2 million for the year ended December 31, 2013. The revenue increase was caused by the 3% annual tariff increase coupled with a slight increase in production as a result of wells being offline for the San Jacinto drilling remediation program in 2013.
- The plant generated operating income in 2014 of $7.4 million, a 23% increase ($1.4 million) from $6 million generated in 2013, and cash flows from operations of $13.2 million increased 56% ($4.7 million) from $8.4 million in 2013.
Ram Power Corporate Update
- As previously disclosed, Ram Power formed a Mergers and Acquisitions Committee to explore and evaluate a broad range of strategic alternatives for the Company to enhance shareholder value. The Mergers and Acquisitions Committee is tasked with exploring opportunities to increase operational efficiencies, strategic partnerships, asset sales or purchases, joint ventures, the sale of the Company, alternative operating models, or continuing with the current business plan, among other potential alternatives. The Company has received a number of proposals from interested third parties and continues to work with its stakeholders and potential investors to bring a transaction to conclusion.
Phase I and II Subordinated Debt Facilities
- The Company has not made the aggregate US$3,833,323 principal and interest payments required to be made on September 15, December 15, 2014 and March 15, 2015 in respect of its Phase I and Phase II subordinated debt facilities. As the Company has previously disclosed, we continue to work alongside our Phase I and Phase II Senior and Subordinated Lenders, and both parties are interested in bringing to close a transaction in early 2015. As a result of the fact that the subordinated debt payments were not made, the amounts outstanding under these agreements have been classified by the Company as short-term liabilities.
The financial results of Ram Power for the years ended December 31, 2014 and 2013 are summarized below:
---------------------------------------------------------------------------- Year ended (all figures in U.S dollars) December 31, 2014 December 31, 2013 ---------------------------------------------------------------------------- 49 MW (net) 48.4 MW (net) Total revenue $ 48,183,646 $ 46,210,054 Other direct costs (6,630,440) (6,164,893) Depreciation and amortization of plant assets (26,143,794) (24,500,650) General and administrative expenses (7,014,601) (9,609,351) Other operating costs (982,070) 96,295 Operating income 7,412,741 6,031,455 Loss on impairment - (20,348,852) Gain on warrant liability valuation 1,340,785 4,431,225 Loss on prepayment option valuation (1,357,000) (4,624,518) Other gains 5,984,206 847,075 Current and deferred tax expense (11,854,713) (8,224,431) Total loss and comprehensive loss (23,948,518) (50,935,278) Total loss and comprehensive loss per share ($0.06) ($0.17) ------------------------------------- As at December 31, As at December 31, 2014 2013 ------------------------------------- Total assets $ 422,500,655 $ 457,959,404 Long-term debt 44,636,776 239,841,360 Total liabilities 283,891,348 295,537,930 Cash 15,291,540 22,549,994 Working capital (179,405,527) 6,329,850
For the year ended December 31, 2014, the Company reported revenue of $48.1 million and a total loss and comprehensive loss of $23.9 million, or $(0.06) per share, compared to revenue of $46.2 million and a total loss and comprehensive loss of $50.9 million, or $(0.17) per share, for 2013. The 4% increase in revenue resulted from the 3% annual tariff increase coupled with a slight increase in production as a result of wells being offline for the San Jacinto drilling remediation program in 2013. Total loss and comprehensive loss for year ended December 31, 2014 was the result of non-cash depreciation and amortization expense of $26.1 million and deferred tax expense of $11.9 million, offset by unrealized foreign exchange gains on translation of the Company's debentures of $3.6 million and a gain on the sale of the Geysers project of $2.4 million.
For the year ended December 31, 2014, the Company had net operating cash inflows of $13.2 million, net investing cash outflows of $2.7 million and net financing cash outflows of $17.7 million, which combined for a net decrease in cash of $7.2 million. The Company expended $9.9 million for additions to geothermal properties, principally related to San Jacinto drilling and turbine overhaul costs. At December 31, 2014, the Company had cash of $15.3 million, of which $14.1 million was held for current use in the San Jacinto project.
The Company will need to raise additional capital through the strategic process in order to continue funding operating and exploration and development expenditures. However, it is not possible to predict whether financing efforts will be successful on terms acceptable to the Company (or at all) or if the Company will attain profitable levels of operations. The audited annual consolidated financial statements being released today do not give effect to adjustments that would be necessary should the Company be unable to continue as a going concern.
The Company believes sales of assets, capital raises and future activities of the Company will be sufficient to allow the Company to fulfill its current obligations and continue to operate for the foreseeable future. Should additional capital requirements or the replacement of debt be necessary, the Company expects it could satisfy these requirements through debt restructurings, capital raises or asset sales. However, the outcome of these matters cannot be predicted with certainty at this time.
"We appreciate the patience of our shareholders while we continue to have productive discussions with all of our stakeholders regarding the strategic process for the Company," stated Antony Mitchell, Executive Chairman of Ram Power. "We hope to have an announcement in the near future."
As a result of the continuing strategic process of the Company, there will not be an annual earnings call with management for the year-end results. The Company will provide an update with respect to the strategic process at such time as developments require disclosure in accordance with applicable securities laws.
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 depreciation and amortization expenses of plant assets are excluded in the calculation of EBITDA. Accordingly, where EBITDA measures are disclosed by the Company, they equal operating income or loss plus depreciation and amortization of plant assets. Although a non-GAAP measure, management believes users of the Company's financial information find 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.
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; the ability of the Company to continue as a going concern and general economic conditions, 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.
Director of Investor Relations
Ram Power, Corp.
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