Alterra Power MGMXD

RE:Good news and bad

[carinthian]

Hi calmandquiet,

Regarding the distribution from toba I think I remember them to say something like beginning of second quarter when they expect the reserves to be big enough to start distributing again. Might have been said in the 3rd quarter call.

Regarding the thought of making a profit in 2014:
Gross Profit 2013 was aorund 13mio. This should be the number of what they did earn from their plants they own more than 51% of in my understanding.

The equity accounted investments, which should be the stuff they own below 50%, did distribute another 13,5mio to the holding company.

So let's assume Toba starts to distribute again after building up some cash reserves and with that they be able to get 30mmio of gross profit and distribution from equity investments alltogether (although I think that the 3mio. increase is too little).

From that let us put away  15mio for G&A, exploration, exploration and other expenses.

Then we have 15mio left. Then deduct finance cost and add finance income and I'd say that around 8mio. remain.

As a next step let's say that there are no more write downs, no change to the derivatives, to currencies and bonds payable. Or that they do not sell moe assets. Still remaining at 8mio. (of course it could easily go the other way and derivatives valuation boosts the result by 20mio.)

So as they now put every $ they spend on forwarding the written off projects under expenses there remain 8mio. for that which means there should be a loss if all of what I did assume above happens that way which as unlikely as they get the PPA in Iceland done or the PPA for Bute Inlet.

I am no accountant and you are right that it is not that easy to figure out what really has happened and influenced the company looking at the reports as they do quite a lot of changes and sometimes I give up reading all the 36 notes or so...

Regarding the asset write down: You did notice that they still plan expenditures on those projects? So the next quarterly will show if they really giving up or just did the painful (for PL - cash on it has already been spent) to show better upside in the future.

Regarding the new projects I am as I said disappointed as I expected higher participation in Shannon. And I especially hoped for 100% of the hydro asset so I hope that they will at least take Jimmie Creek with 51% and Shannon with 49%. And I hope that some money that was spent for developing the projects flows back in our pockets.

The positive thing (I mean you can always take something good out of anything) one could argue is that they keep better diversified and less dependent from certain assets.

It remains a depressed sector but the company is viable in my eyes and if they are able to execute IRR's of 10-20% on their projects I am confident that in the long term this will work out but I do not expect any massive movements within the next 24-36month if they do not show further projects that will come online in that timeframe...

Long term (+10 years) I am still a dreamer of seeing them forwarding the hydro assets and getting started constructing them... :-) But that is just me.

Just my personal thoughts. DYODD
carinthian