earnings report "We are pleased to announce that today our Board of Directors approved a 6% increase in our quarterly common share dividend, supported by solid operating results from the Company's diversified and resilient business model," said Arun Banskota, President and Chief Executive Officer of AQN. "We remain committed to delivering on the Company's $12.4 billion capital plan from 2022 through 2026 to drive growth in earnings and cash flows which we expect will, in turn, support compelling returns for shareholders."
Q1 2022 Financial Highlights
- Revenue of $735.7 million, an increase of 16% compared to the first quarter of 2021
- Adjusted EBITDA1 of $330.6 million, an increase of 17% compared to the first quarter of 2021;
- Adjusted Net Earnings1 of $141.3 million, an increase of 13% compared to the first quarter of 2021; and
- Adjusted Net Earnings1 per share of $0.21, an increase of 5% compared to the first quarter of 2021.
| All amounts in U.S. $ millions except per share information | Three months ended March 31 |
| 2022 | 2021 | Change |
| Revenue | $ | 735.7 | | | $ 634.5 | | | 16% |
| Net earnings attributable to shareholders | 91.0 | | | 13.9 | | | 555% |
| Per share | 0.13 | | | 0.02 | | | 550% |
| Cash provided by operating activities | 166.2 | | | (243.5) | | | 168% |
| Adjusted Net Earnings1 | 141.3 | | | 124.5 | | | 13% |
| Per share | 0.21 | | | 0.20 | | | 5% |
| Adjusted EBITDA1 | 330.6 | | | 282.9 | | | 17% |
| Adjusted Funds from Operations1 | 220.2 | | | 205.3 | | | 7% |
| Dividends per share | 0.1706 | | | 0.1551 | | | 10% |
| 1. Please refer to "Non-GAAP Measures" at the end of this document for further details. |
Corporate Highlights
- Approval by Kentucky Public Service Commission ("KPSC") – On May 4, 2022, the KPSC issued an order, including an approval of the pending acquisition of Kentucky Power Company and AEP Kentucky Transmission Company, Inc. (the "Kentucky Power Transaction") by Liberty Utilities Co. ("Liberty Utilities"), an indirect, wholly-owned subsidiary of AQN, subject to certain conditions set forth in the order, including those agreed to by Liberty Utilities in the course of the docket. The Kentucky Power Transaction was originally announced on October 26, 2021. Closing of the Kentucky Power Transaction is subject to the satisfaction of certain conditions precedent, including the approval of the U.S. Federal Energy Regulatory Commission ("FERC") for the Kentucky Power Transaction and certain approvals from FERC, the KPSC and the Public Service Commission of West Virginia with respect to the termination and replacement of the existing operating agreement for the Mitchell coal generating facility (in which Kentucky Power Company owns a 50% interest).
- Liberty New York Water Acquisition & Integration – Effective January 1, 2022, the Company closed the previously-announced acquisition of New York American Water Company, Inc. (subsequently renamed Liberty Utilities (New York Water) Corp.) from American Water Works Company, Inc. for a purchase price of approximately $609 million. The transition and integration are progressing well as the Company continues to deliver safe and reliable water service to customers in New York.
- Issuance of approximately $1.1 Billion of Subordinated Notes – On January 18, 2022, the Company completed concurrent public offerings of junior subordinated notes in the United States and Canada in an aggregate principal amount of $750 million and C$400 million, respectively (the "Note Offerings"). The Company intends to use the net proceeds of the Note Offerings to partially finance the Kentucky Power Transaction provided that, in the short-term, prior to closing of the Kentucky Power Transaction, the Company has used a portion of, and expects to use the remainder of such net proceeds to repay certain indebtedness of the Corporation and its subsidiaries.
- Empire Missouri Rate Case Outcome – On May 28, 2021, the Empire District Electric Company ("Empire") filed a rate review based on a 12 month historical test year ending September 30, 2020, with an update period through June 30, 2021, requesting an increase in rates of $79.9 million which included $29.9 million related to recovery of fuel and power pass-through costs related to the February 2021 Midwest Extreme Weather Event. Empire subsequently amended the rate request to $50.0 million after deferring the recovery of the extraordinary fuel pass-through costs as well as certain costs related to the retirement of the Asbury coal plant to a subsequent docket requesting securitization. On April 6, 2022, the Missouri Public Service Commission issued its final Report and Order resulting in an annual base rate revenue increase of $39.5 million.
- Completion of the Blue Hill Wind Facility – On April 14, 2022, the Renewable Energy Group achieved full commercial operations at its 175 MW Blue Hill Wind Facility, located in southwest Saskatchewan. The Blue Hill Facility is the Renewable Energy Group's 15th wind powered electric generating facility and is expected to generate approximately 683 GW-hrs of energy per year, with the output being sold through a long-term power purchase agreement with an investment grade rated entity.
- Ongoing Execution of C&I Strategy – The Company continues to execute on its relationship with commercial and industrial ("C&I") customers to help them achieve their sustainability objectives. On May 10, 2022, AQN announced its collaboration with Meta, formerly known as Facebook, Inc., on AQN's 112 MW Deerfield II Wind Project in Huron County, Michigan. Pursuant to the long-term power purchase agreement entered into by the parties, Meta will purchase 100 percent of the energy and environmental attributes from Deerfield II, building upon the existing relationship the companies have at the operating Altavista Solar Facility in Virginia. Construction on Deerfield II began in April 2022.
- Increase in Common Share Dividend – Consistent with AQN's history of delivering total shareholder return comprised of an attractive dividend yield and capital appreciation, on May 12, 2022, AQN's board of directors approved a 6% dividend increase from a total annualized dividend of $0.6824 per common share to a total annualized dividend of $0.7233 per common share. The dividend is expected to be paid quarterly at a rate of $0.1808 per common share, up from $0.1706 per common share.