News Article | February 15, 2017
2016 was generally a good year for the stock market, but the average clean energy investor did not share in the gains. Clean energy investors naturally gravitate toward exciting stocks developing solar and, more recently, electric vehicles . These technologies are bringing great benefits to the planet and customers (including me- I installed a solar array on my home in in 2014, and my wife and I just bought a Toyota Prius Prime plug-in.)Investors' lousy returns are due to a common problem in sectors with rapidly improving technology: Competition within the industry constantly undermines profitability. I've been warning about this problem since 2009 , and I believe that this awareness is a large part of the reason that my "10 Clean Energy Stocks" model portfolios have outperformed the most widely held clean energy ETF, PBW , in every year except 2013. Over the nine model portfolios (2008 to 2016) have had positive returns in six of those years, compared to just two (2009 and 2013) for PBW.2016 was no exception to this trend, with the Ten Clean Energy Stocks for 2016 model portfolio up 20%, while PBW fell 22%. Again, the culprit was solar, with the industry suffering from overcapacity and rapidly falling module prices . These low solar module prices are great for the planet and have made new solar farms able to compete with fossil generation purely on price , but they lead to non-existent profits for solar companies and investors.With this backdrop, the list has increasingly featured a new class of stocks, Yieldcos. Yieldcos are the customers of wind and solar manufacturers because they invest in wind and solar farms. As an added bonus, they pay out most of their cash flow in the form of dividends to investors. Given my focus on Yieldcos and other green income stocks, using the beleaguered PBW as a benchmark for my list is increasingly unfair. Fortunately, a Yieldco ETF ( YLCO ), launched in May 2015. In 2016, I used YLCO as a benchmark for the seven income stocks in the list, and PBW as the benchmark for the remaining three. The benchmark for the whole model portfolio was a 70/30 weighted average of the returns of the two.As you can see in the chart above, the change in benchmark did not prevent my model portfolio from producing a total return that was a full 24% ahead of its benchmark, but at least the comparison was fair.Also shown in the chart is the Green Global Equity Income Portfolio, a private strategy I have been managing in separate accounts since the end of 2013. I've been exploring options for bringing this strategy to the public for the last year. Despite an excellent track record (annualized returns of 10.6% since inception) I have not yet found a mutual fund company willing to take it public. There is also a hedge fund style version of the strategy which can use shorting, uncovered put selling, and leverage. This version of the strategy has produced a 13.4% annualized return over three years.While GGEIP is not yet available as a mutual fund, I created a long-only version on the Motif platform, the Green Equity Income Motif 2016 last year. Since GGEIP is an active strategy, I plan to launch a new version to reflect portfolio changes at least once a year.Investment Advisor Jan Schalkwijk, CFA at JPS Global Investments now offers a more frequently re-balanced version of GGEIP to his clients. The Folio version now has a year's track record, and it is performing in line with the other versions of GGEIP.So far, this is just a model without client money, so the track record does not include trading costs or fees, both of which are likely to reduce real-world performance. When trading real money, the actual trade prices can be materially different from those of a model portfolio... just as people's results following my model portfolio will be significantly different from the numbers you find here. And, of course, past performance is no guarantee of anything, let alone future results.The following chart (click for full-size version) shows how the individual stocks fared. The green (yellow) bars show the High (Low) Target I gave for each at the start of the year. A few green bars are missing where the high target is off the scale of the chart. I predicted that most of the stocks would end the year between the high and low targets. Only Enviva ended outside the range, finishing about 1% above the high target.In the discussion below, I'll look at how each stock performed for the year, and why. For those stocks not included in 10 Clean Energy Stocks for 2017 , I'll talk discuss my outlook and why they were dropped. My outlook for stocks included in the 2017 list can be found here Wind Yieldco Pattern Energy was hurt early in the year due to low wind production because of El Nino weather conditions, and late in the year because management realized that internal accounting controls had become inadequate as the company grew. Management does not believe that any of its numbers were actually misstated and is working to correct the problem. I'm wildly enthusiastic about the stock at the current price, and it is my top pick in the 2017 list.Wood pellet focused Master Limited Partnership (MLP) and Yieldco Enviva Partners was the biggest winner for the year. Although a 7.9% current yield is still decent, I expect higher yields from MLPs than other stocks because of the higher and more complicated taxes on distributions.I also worry that if Donald Trump chooses to ignore the United States' obligations under the Paris agreement (as it looks very likely that he will), Europeans may also slow down their efforts to reduce greenhouse gas emissions from electricity generation. This would affect Enviva's potential long term growth because its biggest customers are European coal plants which have been converted to burn wood pellets instead. I also expected that states plans to comply with Obama's Clean Power plan would have led to some US coal plants also being converted to burn wood pellets. That prospect is also less likely with Trump as President.No matter what happens in Europe, existing contracts are long term and unlikely to be at risk. In fact, the European Commission recently approved a subsidy to help Enviva's customer, Drax, pay for wood pellets produced by Enviva and burned in a converted coal power station in North Yorkshire, in the UK.The combination of less attractive valuation and diminished growth prospects led me to drop Enviva from the 2017 list and sell my position. I will continue to watch the stock and buy again if it falls to more attractive levels.Ethanol production MLP and Yieldco Green Plains Partners also faces risks from a Trump administration. The oil industry hates the EPA's Renewable Fuel Standard (RFS), which requires a minimum volume of ethanol to be blended with gasoline, and Trump has strong ties and large investments in the industry. His likely cabinet is also filled with oil men.This uncertainty, along with a less attractive valuation due to gains in 2016 have led me to drop GPP from the 2017 list and sell my stake.YieldcoNRG Yield's ( NYLD and NYLD/A ) seems likely to remain largely unaffected by a Trump administration. Since its valuation remains attractive, it is in the 2017 list.Yieldco Terraform Global struggled with its former sponsor Sun Edison's ( SUNEQ ) bankruptcy. This impacted its ability to file timely financial reports, and led to significant uncertainly about the company's true value.The company has begun to release financial data and regain compliance with NASDAQ listing requirements. I expect the company to be bought by a large company in 2017, possibly in the next few months. I expect the sale price will be between $4 and $6 per share, most likely between $4 and $5. Given the relatively modest expected gain, and the fact that I might need to find a replacement early in the year, I have dropped GLBL from the 2017 list. I maintain my personal position in the stock and in GGEIP. 12/31/15 Price: $18.92. 12/31/15 Annual Dividend: $1.20 (6.3%). Beta: 1.22. Low Target: $17. High Target: $27. 12/31/16 Price: $18.99. 2016 Dividend (Yield): $0.93 (6.5%). Current Yield: 6.3% 2016 Total Return: 6.5% Clean energy financier and REIT Hannon Armstrong has fallen over the last two months due to rising interest rates and concern that it might lose its status as a REIT. I feel the risk of a potential loss of REIT status has been overblown. Hannon Armstrong remains in the 2017 list. I have been adding to my position, which I had reduced for re-balancing when the stock was in the $22 to $25 range. I almost dropped Hannon Armstrong from the list last year given the plethora of highly attractive Yieldcos at great valuations at the time. This year, keeping it was a very easy decision. Canadian listed Yieldco TransAlta Renewables' prospects are unaffected by political developments in the United States, but its large gains in 2016 have given it a less attractive valuation. It also owns significant natural gas assets, making it less green than most of the Yieldcos. Although the RNW is not in the 2017 list, I maintain a reduced position, and might increase my stake if the price falls. Renewable Energy Group (NASD:REGI) 12/31/15 Price: $9.29. Annual Dividend: $0. Beta: 1.01. Low Target: $7. High Target: $25. 12/31/16 Price: $9.70. 2016 Total Return: 4.4% Advanced biofuel producer Renewable Energy Group, like ethanol producers (see the Green Plains Partners discussion above), is potentially more vulnerable to action by an administration skeptical of renewable energy than are Yieldcos. If the EPA's incentives for biodiesel and renewable diesel remain unchanged, the company's profits and stock price have the potential for explosive gains. That prospect is far from certain, however, so I have dropped the company from the 2017 list and greatly reduced my personal holdings. MiX Telematics Limited (NASD:MIXT; JSE:MIX). 12/31/15 Price: $4.22 / R2.80. 12/31/15 Annual Dividend: R0.08 (2.9%). Beta: -0.13. Low Target: $4. High Target: $15. 12/31/16 Price: $6.19 / R3.20. 2016 Dividend (Yield): R0.08/$0.138 (3.3%) Current Yield: 2.4% 2016 Total Return: 51.1% Software as a service fleet management provider MiX Telematics is a significant potential beneficiary of a Trump administration. Many of MiX's largest clients are part of the global oil and gas industry. The drilling revival that Trump hopes to bring about should lead these customers to buy more vehicles, and they pay MiX for fleet management on a per-vehicle basis. Despite MiX's significant gains in 2015, a low priced stock buyback and the improving economic backdrop return the company keep MiX Telematics in the 10 Clean Energy Stocks list and my portfolio for the third year in a row. I liked MiX at $6.50 at the start of 2015, liked it more at $4.22 a year ago, and still like back at $6.50 today. The share price does not reflect the advances the company has made over the last two years, nor does it reflect MiX's underlying value. Ameresco, Inc. (NASD:AMRC). Current Price: $6.25. Annual Dividend: $0. Beta: 1.1. Low Target: $5. High Target: $15. 12/31/16 Price: $5.50. 2016 Total Return: -9.2% Energy service contractor Ameresco looked to be recovering from a long slump before the November election. This recovery was at least in part driven by the Obama administration's efforts to improve the energy efficiency of government operations. Although the Republicans and Trump are not openly hostile towards energy efficiency in the way they are towards renewables, it seems unlikely that it will be a priority for them. At worst, President Trump could remove many of Obama's energy efficiency targets for government operations with the stroke of a pen, cutting into Ameresco's future business. With these risks in mind, I dropped Ameresco from the 2017 list and sold all my personal holdings. The incoming President and Congress are skeptical of climate change and have yet to recognize that clean energy is far more effective at creating good paying domestic jobs than traditional fossil fuels. Trump himself is highly unpredictable and many of his election promises, if implemented, are more likely to harm than help the US and world economy. In particular, promises of increased spending and tax cuts could send the deficit and interest rates soaring. Promises to talk tough and renegotiate trade deals might even lead to a global trade war, with crippling effects on the world economy.Against this uncertain and potentially volatile backdrop, the valuations of many defensive clean energy stocks remain attractive. A significant allocation to cash seems prudent, but investments in defensive, attractively valued companies such as my 10 Clean Energy Stocks for 2017 could still pay significant rewards. DISCLAIMER: Past performance is not a guarantee or a reliable indicator of future results. This article contains the current opinions of the author and such opinions are subject to change without notice. This article has been distributed for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed.
News Article | September 5, 2016
My Ten Clean Energy Stocks for 2016 model portfolio continued to coast upward in August after five months of blistering performance since February, while clean energy sector benchmarks and real managed portfolio, the Green Global Equity Income Portfolio (GGEIP), pulled back slightly. The following chart shows the performance of the model portfolio and its sub-portfolios against their benchmarks.The portfolio, its growth and income subportfolios, and GGEIP all remain far ahead of their benchmarks. Second quarter earnings announced this month were neutral or positive for the income stocks, but somewhat disappointing for the growth companies, causing the income group to pull farther ahead of its benchmark, and the growth group to lose a little ground.See the May update for a description of the benchmarks.Last month, I mentioned that I was in advanced talks with a mutual fund company to bring the Green Global Equity Income strategy to the public as a mutual fund. I met with them for the fourth time last month, but they decided to pass, in large part because my emphasis on small and relatively illiquid stocks may put a limit on how large (and hence profitable) such a mutual fund can become.Fortunately, I've been working on alternatives, two of which are now available for small investors. My friend and colleague Jan Schalkwijk, CFA at investment advisor JPS Global Investments is now offering a version of the GGEIP strategy to his clients (new or existing) clients. If you are interested, you can contact him here . There is a also stripped-down but free version of GGEIP I launched on the Motif platform in June.Or you can just continue to follow the income stocks in this annual model portfolio. Although this group of seven is outperforming most other versions of the strategy this year, I think that difference is mostly luck. The strategy had an excellent year in 2015 as well: The six income stocks were up 24% and GGEIP was up 12% even though their income benchmark fell 30% because of the bursting of the Yieldco bubble The chart above gives detailed performance for the individual stocks. Selected news driving individual stocks is discussed below.Wind Yieldco Pattern Energy's revenues were at the low end of the company's projections due to generally low wind speeds, but earnings and cash available for distribution (CAFD) were strong due to good cost management and performance of the company's wind farms.The company also announced the sale of 10 million shares of stock at $23.90, with an additional 1.5 million share underwriter's option. It intends to use the cash to fund the purchase of the 180 MW Armow Wind power facility in Ontario from its sponsor. I expect the acquisition to increase CAFD and dividends per share even after the dilutive effects of the share issue.Wood pellet focused Master Limited Partnership (MLP) and Yieldco Enviva Partners increased its distribution to $0.525, and increased its full distributable cash flow guidance from $67-$71 million to $70-$72 million. The company reaffirmed full year distribution guidance of at least $2.10 per unit. The new guidance increases the likelihood that Enviva will distribute more than that.The market seems to have gotten the message that this wood pellet manufacturer has fuel to burn: The stock was up 19% for the month.Ethanol production Yieldco Green Plains Partners increased its quarterly distribution to $0.41 per unit, and reported $0.43 in per unit income for the quarter. It's parent company, Green Plains ( GPRE ) produced a record volume of ethanol in the second quarter. In the first quarter, the partnership relied on minimum volume guarantees from its parent to support revenues. The recovery in ethanol volumes means that GPRE no longer needs to rely on these guarantees.YieldcoNRG Yield ( NYLD and NYLD/A increased its quarterly dividend to $0.24 and reaffirmed its guidance that the dividend would continue to grow by 15% annually through 2018.The Yieldco entered an agreement to acquire the 51% of the California Valley Solar Ranch Holdco it does not already own from its parent. The transaction was financed with $200 million of senior secured debt financed with a 4.68% interest rate.Yieldco Terraform Global's delayed financial filings due to the bankruptcy of its former sponsor, SunEdison ( SUNEQ ), put it into technical default with some of its bondholders. The company successfully negotiated a waiver extending the deadline for filing the delayed reports until December 6th.It was also reported that Indian company Greenko would pay $100 million for SunEdison's Indian assets along with the assumption of outstanding debt, including some nonoperational assets which SunEdison had agreed to transfer to Terraform Global upon completion in exchange for an advance payment prior to its bankruptcy. It is not clear how the continuing dispute between the Yieldco and SunEdison over the use of the advance payment will affect this deal. 12/31/15 Price: $18.92. Dec 31st Annual Dividend: $1.20 (6.3%). Beta: 1.22. Low Target: $17. High Target: $27. 8/31/16 Price: $23.98. YTD Dividend: $0.60. Expected 2016 Dividend: $1.25 (5.2%). YTD Total Return: 30.4% Clean energy financier and REIT Hannon Armstrong reported increased second quarter core earnings to $0.32 per share, easily enough to continue to support the current dividend of $0.30 per share and an expected increase to at least $0.34 per share in December. Hannon Armstrong has a target of paying out 100% of core earnings in dividends and a policy of increasing the dividend once per year in the fourth quarter. Since Core Earnings have historically always increased or held constant from quarter to quarter, they typically lag the dividend in the first two quarters, but exceed them in the second half of the year. I expect this year to be different. Results in the first half of the year were boosted by a larger securitizations (selling assets to third parties rather than keeping them on the books.) While producing strong earnings in the quarter when they happen, securitizations produce no ongoing income. After raising $91 million in equity in June, the company will again return to placing more transactions on the balance sheet, a change which I expect to reduce core earnings in the third quarter before returning to growth in the fourth quarter. I expect my anticipated decline in third quarter earnings in early November to catch some investors by surprise. Investors looking to buy the stock should wait until then. Investors considering taking some gains may want to sell before the November announcement. Canadian listed Yieldco TransAlta Renewables reported results "tracking toward the upper end of the guidance we provided for 2016." The company's major South Hedland project continues on budget and on schedule for completion in mid-2017. The company anticipates a further dividend increase when it is delivered. Renewable Energy Group (NASD:REGI) 12/31/15 Price: $9.29. Annual Dividend: $0. Beta: 1.01. Low Target: $7. High Target: $25. 8/31/16 Price: $8.97. YTD Total Return: -3.4% Advanced biofuel producer Renewable Energy Group reported strong market demand for biomass based diesel and increased sales, which were limited only by production capacity. But per share earnings of $0.16 fell short of analyst's expectations, causing the stock to pull back. Federal and state support remains strong, and analysts have been raising current year earnings estimates. I believe the current pullback provides an excellent opportunity for short term gains before the end of the year. MiX Telematics Limited (NASD:MIXT; JSE:MIX). 12/31/15 Price: $4.22 / R2.80. Dec 31st Annual Dividend: R0.08 (2.9%). Beta: -0.13. Low Target: $4. High Target: $15. 8/31/16 Price: $4.99 / R2.90. YTD Dividend: R0.06/$0.101 Expected 2016 Dividend: R0.08 (2.8%) YTD Total Return: 21.0% Software as a service fleet management provider MiX Telematics rose in its native currency, the South African Rand, but these gains were erased by the strong dollar. Ameresco, Inc. (NASD:AMRC). Current Price: $6.25. Annual Dividend: $0. Beta: 1.1. Low Target: $5. High Target: $15. 8/31/16 Price: $4.78. YTD Total Return: -19.2% Energy service contractor Ameresco continued to report strong growth in revenue, earnings, and cash flow. While the past few years have been disappointing, I believe that the company has returned to sustainable growth and expect the stock to continue to recover. The broad stock market been very strong this year despite continued and increasing global uncertainty. This is likely because US economy has appeared to be a lone bright spot. Indications of future growth have been mixed however, and I believe a defensive stance is warranted. While none of these stocks is the screaming bargain they were in the first quarter, the income stocks remain inexpensive and good defensive plays going forward.While more sensitive to a weakening economy, the three growth stocks remain extremely cheap, especially REGI and MIXT. These low valuations limit their downside should the broad market fall, while allowing for large gains if they catch investors' attention. DISCLAIMER: Past performance is not a guarantee or a reliable indicator of future results. This article contains the current opinions of the author and such opinions are subject to change without notice. This article has been distributed for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed.
News Article | March 4, 2016
The first two months of 2016 have been chilly ones for the market, and for clean energy stocks. In addition to the worries about the world economy and plunging oil prices which have been hitting stocks in general, the clean energy sector had to deal with the Supreme Court's stay on Obama's Clean Power Plan. This effect was mitigated the following week by the lost of conservative Justice Scalia, but many states' subsequent delays of their compliance plans have put an additional chill on clean energy stocks, even ones which are unlikely to be affected.In January and February, my Ten Clean Energy Stocks for 2016 model portfolio declined 13.5%, slightly worse than its benchmark (see below), which fell 11.5%. The seven income stocks were down 11.2% on average, slightly below my income benchmark, the Global X Yieldco ETF ( YLCO .) The three growth stocks declined 18.8%, also behind their benchmark, the Powershares/Wilderhill Clean Energy ETF ( PBW ), which fell 13.9%. The overall benchmark mentioned above is a 70/30 blend of the income and growth benchmarks.The Green Global Equity Income Portfolio, a seed account investing in green income stocks which I manage performed outperformed all of them, falling only 4.7% year to date. It under-performed the much smaller income model portfolio last year, so but now it seems to be making up for lost time.The chart above gives detailed performance for the individual stocks. Significant news driving individual stocks is discussed below.Wind Yieldco Pattern Energy's decline so far this year is completely unexplained by news. The company's fourth quarter results were strong, and it increased its dividend for the eighth consecutive quarter since its IPO. Even assuming the stock price does not recover and it cannot sell additional shares at an attractive price, the company has sufficient capital to increase Cash Available for Distribution (CAFD) to about $156M ($2.06 per share) over the next couple years, which would translate to a 12.2% yield at the current price.Expect the continued dividend increases will eventually bring the price up, and allow further secondary offerings which can in turn accelerate growth. At a 7% yield, a $2.06 annual dividend translates to a $29.43 share price, or a 73% increase on the current price. While we're waiting for these capital gains, we are collecting a very healthy and growing 9.0% yield.Wood pellet focused Master Limited Partnership (MLP) and Yieldco Enviva Partners has been one of the few bright spots in the portfolio. Its gains have come because, like most Yeildcos, its long term contracts insulate it from the economy, and its results have nothing to do with the price of oil.The company exceeded its guidance by completing an asset drop-down from its parent ahead of schedule, and provided new guidance for total distributions in 2016 of at least $2.10, 19% over its annual distribution rate at the end of 2015.Like Enviva, Green Plains is a new MLP and Yieldco. The company's contracts with its parent, Green Plains ( GPRE ), also insulate it from the general level of economic activity and commodity markets. However, this insulation is only as good as its parent's solvency. While GPRE has a strong balance sheet, its ethanol operations are exposed to commodity markets, especially the oil price.Although Green Plains Partners also increased its distributions, the increase was small. Because of this, GPP has declined along with the market and the oil price. Should the oil price continue to recover, I would expect that to be reflected in GPP's price.I included YieldcoNRG Yield ( NYLD and NYLD/A ) in this list because the stock had fallen so far because of management changes at its parent NRG and the Yieldco selloff that I felt it now represents a compelling value. This is in sharp contrast to the start of 2015, when, at nearly three times its current price, I thought it was so overvalued that I was short the stock.Despite the troubles and redirection at its parent, NRG Yield raised its first quarter dividend to $0.225, and reaffirmed its target dividend for Q4 of $0.25, which would translate to an 8% annual yield at the current price.Terraform Global's stock has been suffering because it's sponsor and controlling shareholder, SunEdison ( SUNE ) is flirting with bankruptcy, and investor worries that the Yieldco wsill be drawn in, or at the very least have to cut its dividend.At the end of February, the company reaffirmed its $0.275 quarterly dividend, which should help to allay dividend cut fears in the short term. The company will announce its fourth quarter results before the end of March.At the end of the third quarter, the company had $9.50 in cash and $7.48 in book value (mostly solar projects, less debt) per share. So long as SunEdison does not have access to these assets in a bankruptcy, buying them for $3.17 with a $0.275 dividend on the way seems like a screaming deal. Here is what credit agency Moody's has to say about the likelihood of losing control of those assets "The assets and cash flows of the yieldcos would only be available to SUNE's creditors in case of a SUNE bankruptcy if a substantive consolidation of the yieldcos into a SUNE bankruptcy were ordered by a bankruptcy judge. ... [W]e consider the likelihood of this event to be remote." 12/31/15 Price: $18.92. Dec 31st Forward Annual Dividend: $1.20 (6.3%). Beta: 1.22. Low Target: $17. High Target: $27. 2/29/16 Price: $17.61. YTD Dividend: $0. Forward Annual Dividend: $1.24 (7.0%). YTD Total Return: -6.9% Clean energy financier and REIT Hannon Armstrong has been benefiting from the 2015 Yieldco melt-down. The withdrawal of most Yieldcos from the solar and wind financing markets has given Hannon more pricing power. This allowed them to renegotiate some new financings in the fourth quarter. The delays hurt fourth quarter performance, but the better terms will help with results going forward. As a result of these better terms and better opportunities in general, HASI has increased the upper end its dividend guidance range to 14% to 18% from its previous guidance of 14% to 16%. It also expects double digit growth in 2017. HASI generally raises its dividend in the fourth quarter. The above guidance implies that the 4th quarter dividend will be between $0.34 and $0.36, and the dividend will be raised another 4 to 7 cents in 2017. TransAlta Renewables completed a drop-down of a cogeneration plant, a wind farm, and a hydro facility in Canada from its parent, TransAlta Corp (TAC). This increased Cash Available For Distribution per share to C$1.08 for 2015, and allowed another dividend increase to C$0.88 annually. Investors are beginning to appreciate the attraction of RNW's slow but steady approach to dividend increases as compared to the roller-coaster ride of US Yieldcos, and the stock rose in the first two months while other Yieldcos were falling. A slight (2.4%) increase in the Canadian dollar helped US investors as well. Renewable Energy Group (NASD:REGI) 12/31/15 Price: $9.29. Annual Dividend: $0. Beta: 1.01. Low Target: $7. High Target: $25. 2/29/16 Price: $7.29. YTD Total Return: -21.5% Advanced biofuel producer Renewable Energy Group (REG) suffered in January because of the continuing slump in the oil price, but it (and, possibly the oil price) seem to have begun coming back since then. The oil price has had worse effects on less well capitalized biodiesel firms, and this allowed REG to acquire its 11th US biodiesel plant just as the industry is poised for a boom because of increased volumetric requirements under the Renewable Fuel Standard, and the reinstatement of the biodiesel blender's tax credit. If the oil price continues to recover, that should help REG as well. The company will report 2015 results on March 8th. MiX Telematics Limited (NASD:MIXT; JSE:MIX). 12/31/15 Price: $4.22 / R2.80. Dec 31st Forward Annual Dividend: R0.08 (2.9%). Beta: -0.13. Low Target: $4. High Target: $15. 2/29/16 Price: $3.47 / R2.20. YTD Dividend: R0.02/$0.12 Forward Annual Dividend: R0.08 (3.6%) YTD Total Return: -17.0% Software as a service fleet management provider MiX Telematics released its third quarter results in February. The company remains on track with 16% year over year subscription growth and 11% year over year subscriber growth despite the pressure the oil price puts on its customers in the oil and gas industry. MiX maintained its guidance for its fiscal 2016 year, which ends on March 31st. The market seems to be ignoring the steady results, and the stock decline is affording investors the opportunity to buy a growth stock at value stock prices. How many stocks have both a 3.6% dividend and a business growing in the double digits? In addition, MiX has $1.85 worth of cash per share, a P/E ratio of 7.7, and EV/EBITDA of 3.3 (anything below 8 is usually considered good.) For comparison, its US competitor Fleetmatics (FLTX) has a P/E of 36 and an EV/EDITDA of 17.9. FLTX is growing a little faster, at about 20% a year, but has less cash and does not pay a dividend. Ameresco, Inc. (NASD:AMRC). Current Price: $6.25. Annual Dividend: $0. Beta: 1.1. Low Target: $5. High Target: $15. 2/29/16 Price: $5.14. YTD Total Return: -17.8% Energy service contractor Ameresco also fell before results were released on March 3rd. Although these results showed that the business is recovering (especially its government energy contracting business), the stock has not shown much life. Management and company insiders are extremely optimistic, as shown both by their statements and by their purchases of company stock. But after the company's long downturn, it will probably take a few more quarters of accelerated improvement in the bottom line before the mass of investors again joins them. In my decade and a half watching the stock markets, I have only seen as many compelling buying opportunities as I see today at the start of 2009. From its low in February 2009 to its recent peak, the S&P 500 nearly tripled.I'm excited about most of the stocks on this list at their current prices, but Pattern and MiX Telematics all stand out as screaming bargains, while Terraform Global is one of the most compelling speculations I've seen in a very long time.I can't say this enough: If readers have any cash still on the sidelines in this market, now is the time to buy. Buy and keep reinvesting the extremely high dividends on offer until prices rise. It is always possible for stocks to fall further, but when investing in dividend stocks like Pattern and MiX with the cash flows to continue and grow those dividends in any economy, you get (generously) paid to buy now and wait. DISCLAIMER: Past performance is not a guarantee or a reliable indicator of future results. This article contains the current opinions of the author and such opinions are subject to change without notice. This article has been distributed for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed.
News Article | April 3, 2016
I’ve been a fan of Tom Konrad’s annual renewable model portfolio for years, so I’m happy to be able to assist Tom with some of his monthly updates.After two chilly months to start off 2016, the outlook turned considerably warmer in March, both for the market and for clean energy stocks. The Russell 2000 (IWM) jumped 8% for the month, as market participants took to the “risk-on trade” following Fed Chairwoman Yellin’s dovish commentary. Clean energy stocks did even better, buoyed by a reversal in the broader energy sector.Tom’s Ten Clean Energy Stocks for 2016 model portfolio pared its losses from Jan/Feb, and is now down only 3.9% for the year, almost exactly the same as its benchmark (see below), which is down 3.8%. The seven income stocks were down 2.3% on average, slightly below the income benchmark, the Global X YieldCo ETF (NASDAQ: YLCO .) The three growth stocks are now down 7.6%, and performed substantially better than their benchmark, the Powershares/WilderHill Clean Energy ETF (NYSEARCA: PBW ), in March. The overall benchmark mentioned above is a 70/30 blend of the income and growth benchmarks.The Green Global Equity Income Portfolio, a seed account investing in green income stocks which is managed by Tom, was only up 6.7% during March. However, it has still outperformed all of the other model portfolios, climbing a total of 1.7% year to date.The chart above gives detailed performance for the individual stocks. Significant news driving individual stocks is discussed below.After two surprisingly poor months to start 2016, Pattern Energy's was up 15% in March. The company's strong fourth quarter results and dividend ex-date in late March were certainly catalysts for the ascent. As mentioned by Tom last month, Pattern Energy’s CAFD (Cash Available for Distribution) is expected to increase to about $2.06/share over the next couple years.Assuming a 7% yield puts the price up near $30, which might be a conservative target once MLP (Master Limited Partnership) investors learn about Pattern’s MLP-like yields and better risk profile. Anyone interested in learning more about Pattern Energy should read Kevin Neumaier ’s recent articles on the company and dig into Tom’s article archive.Wood pellet focused MLP and Yieldco Enviva Partners continued its excellent performance in 2016, jumping another 12% during March. Enviva is in an enviable position at the moment, given that it is producing a fuel source that hasn’t been as effected by the general decline in energy prices. As noted last month, the company provided new guidance for total distributions in 2016 of at least $2.10, 19% over its annual distribution rate at the end of 2015.However, there are some concerns that the EU could take a less positive stance towards wood pellets in the future. For more information, I suggest readers review the comments on this recent article Like Enviva, Green Plains is a new MLP and Yieldco. The company's contracts with its parent, Green Plains ( GPRE ), also insulate it from the general level of economic activity and commodity markets. However, this insulation is only as good as its parent's solvency. While GPRE has a strong balance sheet, its ethanol operations are exposed to commodity markets, especially the oil price.As expected, GPP recovered along with the broader energy sector during March, although the move up was weak given the lack of any positive company specific news.There was no significant news at YieldcoNRG Yield ( NYLD and NYLD/A ) during March, although the company did announce that their new 20MW solar power facility was completed in Southern California. The stock was up a solid 9% for the month and expects to increase their annual dividend to $1.00 per share by the end of 2016.Terraform Global's stock had an extremely volatile month due to bankruptcy concerns at its sponsor and controlling shareholder, SunEdison (NYSE: SUNE ). While the company did pay their 4th quarter dividend as expected in mid-March, they were not able to release their financials due to accounting issues at SunEdison.Global also released an 8-K on March 29th confirming that SunEdison is likely to file for bankruptcy protection, a move which would have material negative impacts on Global. SunEdison currently owes Global about 90MW of power plants from their formation agreements, as well as 425MW of Indian solar aseets for which Global pre-paid $231mil in December 2015. The delivery of some or even all of these assets is now uncertain.Global also has change of control covenants in certain of their bonds and project level debt which could force the company to pre-pay the debts. On the plus side, the company still has an estimated $750mil in unrestricted cash, along with 814MW of operating plants.Both Tom and I believe that the company is largely undervalued at current prices. Tom notes that, “even the current bag of assets should produce the cash flow to support a $0.40 dividend, way more than is needed to justify a $2.50 stock price.” It was also good to see that former CEO Brian Wuebbels resigned this week, and that the board of the directors expressly noted that they take their fiduciary responsibilities to shareholders very seriously and remain committed to acting in their best interests. Clean energy financier and REIT Hannon Armstrong delivered a solid month, performing in-line with the benchmark for the month. As highlighted by Tom many times over the past couple years, the company has an excellent business model that focuses on consistent growth with less risk than most of the Yieldco’s in the space. HASI generally raises its dividend in the fourth quarter. The above guidance implies that the 4th quarter dividend will be between $0.34 and $0.36, and the dividend will be raised another 4 to 7 cents in 2017. TransAlta Renewables continued its excellent performance in 2016, climbing another 18% in March. The stock was boosted in part by continued gains in the Canadian dollar, which was up 4.2% in March. As noted last month, the company recently completed a drop-down of a cogeneration plant, a wind farm, and a hydro facility in Canada from its parent, TransAlta Corp. (NYSE:TAC). Advanced biofuel producer Renewable Energy Group saw its stock soar 29% during March, as the company reported better than expected annual results on March 8th. Thanks to the retroactive reinstatement of the bio-diesel tax credit for 2015, the company reported revenues and earnings which were substantially higher than expected by the market. REGI also announced a stock and/or convertible bond repurchase program of up to $50mil, which has likely provided additional support for the stock. MiX Telematics Limited (NASD:MIXT; JSE:MIX). 12/31/15 Price: $4.22 / R2.80. Dec 31st Forward Annual Dividend: R0.08 (2.9%). Beta: -0.13. Low Target: $4. High Target: $15. 3/31/16 Price: $3.94/R2.36. YTD Dividend: R0.02/$0.12 Forward Annual Dividend: R0.08 (3.2%) YTD Total Return: -5.8% Software as a service fleet management provider MiX Telematics finally saw its stock climb again in March, as it was up 13.5%. The stock was also helped by a 7.5% improvement in the South African Rand. The company also announced two new offerings in North America targeting the oil & gas industry. The 2nd in particular highlighted the expected monthly savings to companies using MiX’s fleet solutions, a key consideration given the cost cutting required in the industry today. In addition, MiX has $1.85 worth of cash per share, and a P/E ratio of just over 8. Ameresco, Inc. (NASD:AMRC). Current Price: $6.25. Annual Dividend: $0. Beta: 1.1. Low Target: $5. High Target: $15. 3/31/16 Price: $4.77. YTD Total Return: -18.6% Energy service contractor Ameresco was the only pick aside from Terraform Global to trade down during March. The company reported so-so results in early March, with no news since, so the stock hasn’t seen any interest. On the plus side, insiders continued to purchase more company stock. Last month, Tom highlighted the fact that he was seeing great values across the renewable energy space, and urged investors with cash to buy. So far, it appears that the call was well timed. Even so, most of the stocks remain strong values, particularly the dividend payers. Given their relatively depressed share prices and projections for increasing dividends, total returns of 20-30% annually over the next couple years are not out of the question. DISCLAIMER: Past performance is not a guarantee or a reliable indicator of future results. This article contains the current opinions of the author and such opinions are subject to change without notice. This article has been distributed for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed.
News Article | December 5, 2016
FRAMINGHAM, Mass. & WAYLAND, Mass.--(BUSINESS WIRE)--Town of Wayland officials and Ameresco, Inc. (NYSE: AMRC), a leading energy efficiency and renewable energy company, hosted an event on Friday, December 2, at the Wayland High School to dedicate the Town’s four recently completed solar facilities. Local Wayland residents participated in the celebration. Speakers included: Eileen McHugh, MCPPO, Senior Program Coordinator Energy Management Services, Massachusetts Department of Energy Resources (DOER); Cherry Karslon, Chair, Board of Selectman, Wayland; Allyson Mizoguchi, Principal, Wayland High School; and Jim Walker, P.E., Vice President, Solar, Ameresco. Wayland’s solar arrays are comprised of a total of 4,214 photovoltaic panels totaling 1,289 kW, and designed to generate over 1.5 million kWh of renewable electricity each year. Collectively, the three solar canopies at the High School, Middle School and Town Building, in addition to a roof top system at the Department of Public Works building are expected to generate enough electricity to offset roughly twenty five percent of the town’s municipal electric needs and generate a financial savings of over $100,000 per year for Wayland. In addition, the solar arrays represent an important contribution to Wayland’s continuing efforts to mitigate greenhouse gas emissions. The carbon offset by the renewable power is equivalent to the annual electricity usage in more than 113 homes annually. “We are thrilled that the solar systems are up and running. The community has watched the construction with great anticipation,” remarked Cherry Karslon, Chair, Board of Selectman. “The energy efficiency work in our town buildings and solar project allowed Wayland to both reduce our carbon footprint and save the town money on its operating expenses. The solar projects will help provide roughly 25% of our municipal electric needs. It has been a win-win for Wayland,” said Ellen Tohn, Co-Chair Energy Initiatives Advisory Committee. "With the passage of the Green Communities Act of 2008, the Commonwealth established an opportunity for municipalities to blaze a new path in the clean energy field. Wayland was one of our earliest designations as a Green Community and I am pleased to see the town utilize the powerful opportunity provided by an energy management services program,” said Dan Knapik, Director of the Green Communities Division at the Department of Energy Resources. “With their partner, Ameresco, the Town will not only be generating clean renewable solar energy from an innovative project, they will also experience a significant guaranteed financial savings." “Municipalities across Massachusetts have been reaping the financial and environmental benefits that come with incorporating renewable energy into their fuel mix,” said Ani Krishnan, Interim Manager of Clean Energy, Metropolitan Area Planning Council (MAPC). ”We are pleased to have provided Wayland with the mechanism to partner with Ameresco through our regional procurement program and build these exceptional projects.” “We are delighted to have worked with the Town of Wayland and its dedicated volunteers on the Energy Committee to realize their vision for creating a sustainable community,” said Jim Walker, Vice President, Solar, Ameresco. “Our solar photovoltaic projects on schools, municipal buildings and parking lot canopies are a source of pride within the community. Even better, the sustainable energy projects deliver electricity cost savings to support other municipal and school budget priorities.” About the Town of Wayland, MA Wayland is a town in Middlesex County, Massachusetts with a population of nearly 13,500 residents. The Town is a designated Green Community, and is committed to delivering the highest quality municipal services in a fiscally responsible and an operationally responsive manner to its citizens. Wayland’s solar projects compliment a range of other green initiatives that include: promoting residential solar installations under the Solarize program, undertaking substantial energy efficiency measures in town and school buildings, upgrading streetlights to use more energy efficient equipment, and resident driven “Transition Wayland” initiative that supports community efforts to address climate change and resiliency. Wayland residents enjoy a full-array of local services including: police and fire protection; award-winning schools (three elementary, one middle, and a senior high school); a full-service library; a public beach; and a number of recreational facilities and programs. The Town operates its own water supply, purification, and distribution system and provides a solid waste transfer station and recycling facility for residents on a fee-for-service basis. Wayland offers its residents many educational, recreational and cultural opportunities, both within the community and as part of the greater Boston metropolitan region. For more information, visit http://www.wayland.ma.us. About Ameresco, Inc. Founded in 2000, Ameresco, Inc. (NYSE:AMRC) is a leading independent provider of comprehensive services, energy efficiency, infrastructure upgrades, asset sustainability and renewable energy solutions for businesses and organizations throughout North America and Europe. Ameresco’s sustainability services include upgrades to a facility’s energy infrastructure and the development, construction and operation of renewable energy plants. Ameresco has successfully completed energy saving, environmentally responsible projects with Federal, state and local governments, healthcare and educational institutions, housing authorities, and commercial and industrial customers. With its corporate headquarters in Framingham, MA, Ameresco has more than 1,000 employees providing local expertise in the United States, Canada, and the United Kingdom. For more information, visit www.ameresco.com. The announcement of a customer’s entry into a project contract is not necessarily indicative of the timing or amount of revenue from such contract, of the company’s overall revenue for any particular period or of trends in the company’s overall total construction backlog. This project was included in our previously reported assets in development as of September 30, 2016.
News Article | February 27, 2017
FRAMINGHAM, Mass.--(BUSINESS WIRE)--Ameresco, Inc. (NYSE:AMRC), a leading energy efficiency and renewable energy company, today announced that the Company will present at the 29th Annual ROTH Conference at the Ritz Carlton in Dana Point, California on Tuesday, March 14, 2017, at 2:30 PM PDT. Chief Financial Officer John Granara is scheduled to present. The presentation will be webcast live on the Investor Relations section of the Company's website at www.ameresco.com. The Company will also host investor meetings throughout the day. Attendance at the conference is by invitation only for clients of ROTH Capital Markets. Interested investors should contact your ROTH Capital Markets sales representative to secure a meeting time. About Ameresco, Inc. Founded in 2000, Ameresco, Inc. (NYSE:AMRC) is a leading independent provider of comprehensive services, energy efficiency, infrastructure upgrades, asset sustainability and renewable energy solutions for businesses and organizations throughout North America and Europe. Ameresco’s sustainability services include upgrades to a facility’s energy infrastructure and the development, construction and operation of renewable energy plants. Ameresco has successfully completed energy saving, environmentally responsible projects with Federal, state and local governments, healthcare and educational institutions, housing authorities, and commercial and industrial customers. With its corporate headquarters in Framingham, MA, Ameresco has more than 1,000 employees providing local expertise in the United States, Canada, and the United Kingdom. For more information, visit www.ameresco.com.
News Article | March 2, 2017
FRAMINGHAM, Mass.--(BUSINESS WIRE)--Ameresco, Inc. (NYSE:AMRC), a leading energy efficiency and renewable energy company, today announced financial results for the fiscal quarter and year ended December 31, 2016. The Company has also furnished prepared remarks in conjunction with this press release in a Current Report on Form 8-K. The prepared remarks contain supplemental information, including non-GAAP financial metrics, and have been posted to the “Investor Relations” section of the Company’s website at www.ameresco.com. Certain prior period results in this press release have been revised as the Company determined that it did not provide for the deferred tax liability and related income tax provision during the year ended December 31, 2015 related to the outside basis difference in its consolidated investment in an investment fund. See the section titled Revision of Previously Issued Financial Statements immediately following the Webcast Reminder below. “Ameresco executed on the growth strategy we outlined in 2016,” said George Sakellaris, Chairman and Chief Executive Officer. “We invested in growing our share in new markets and increasing our penetration in existing markets. We continued to build our portfolio of energy-producing assets, and we realized the benefits of our restructuring and reorganization initiatives from the prior year.” Sakellaris continued, “We advanced our market leadership position via a differentiated approach to design, technology and innovation. This is leading to larger projects which combine complex renewable energy technologies and comprehensive energy efficiency solutions. Our full-year results and the increase in our backlog reflect this focus, providing us with great visibility and momentum heading into 2017.” Revenues were $174.2 million, compared to $173.8 million. Gross profit included a loss for a non-core Canada project of $3.4 million in 2015. Net income was $3.3 million, compared to a net loss of $1.1 million in 2015. Net income included a $0.1 million expense attributable to redeemable non-controlling interest. Adjusted EBITDA, a non-GAAP financial measure, was $14.4 million, compared to $13.1 million. Net income per diluted share was $0.07, compared to net loss per diluted share of $0.02 in 2015. Non-GAAP EPS was $0.08, compared to $0.09. Revenues were $651.2 million, compared to $630.8 million. Gross profit included a loss for a non-core Canada project of $6.6 million in 2015. Net income attributable to Ameresco, Inc. was $12.0 million, compared to net income of $0.8 million. Adjusted EBITDA was $56.2 million, compared to $45.9 million. Non-GAAP net income was $16.8 million, compared to $9.6 million. Net income per basic and diluted share was $0.26, compared to $0.02. Non-GAAP EPS was $0.36, compared to $0.20. Ameresco expects to earn total revenue in the range of $665 million to $700 million in 2017. The Company also expects adjusted EBITDA for 2017 to be in the range of $60 million to $65 million and net income per diluted share to be in the range of $0.37 to $0.43 for 2017. This guidance excludes the impact of any non-controlling interest activity and any additional charges relating to the SunEdison bankruptcy and our restructuring activities. Ameresco's Board of Directors has authorized an increase in the Company’s share repurchase authorization to $15 million, up from $10 million, of the Company's Class A common stock. The Company has repurchased 1,298,418 shares for $6.3 million through December 31, 2016. The timing and amount of any shares repurchased will be determined by the Company's management based on its evaluation of market conditions and other factors. Repurchases may also be made under a Rule 10b5-1 plan, which would permit shares to be repurchased when the Company might otherwise be precluded from doing so under insider trading laws. The repurchase program may be suspended or discontinued at any time. Any repurchased shares will be available for use in connection with its stock plans and for other corporate purposes. The Company will host a conference call today at 8:30 a.m. ET today to discuss results. Participants may access the earnings conference call by dialing +1 (877) 359-9508 or internationally +1 (224) 357-2393. The passcode is 58212980. Participants are advised to dial into the call at least ten minutes prior to register. A live, listen-only webcast of the conference call will also be available over the Internet. Individuals wishing to listen can access the call through the “Investor Relations” section of the Company’s website at www.ameresco.com. An archived webcast will be available on the Company’s website for one year. In conjunction with the conference call, the Company will provide management’s prepared remarks in the “Investor Relations” section of the Company's website, as well as in a Current Report on Form 8-K filed with the SEC. As previously reported, Ameresco determined that it did not provide for the deferred tax liability and related income tax provision during the year ended December 31, 2015 related to the outside basis difference in its consolidated investment in an investment fund. As explained in note 2 to the Company’s consolidated financial statements included in its Annual Report on Form 10-K being filed with the Securities and Exchange Commission tomorrow, the Company is revising its historical financial statements for the year 2015. As a result, 2015 was revised as follows: (i) total long term liabilities increased by $2.1 million as of December 31, 2015 as a result of increasing the deferred tax liability and retained earnings decreased by the same amount as of December 31, 2015, (ii) the income tax provision increased by $2.1 million for the year ended December 31, 2015 which resulted in an increase to net loss and a decrease of net income attributable to Ameresco, Inc. of the same amount for the year ended December 31, 2015, (iii) the basic and diluted net income per share attributable to Ameresco, Inc. decreased from $0.06 to $0.02, (iv) an increase in comprehensive loss, and comprehensive loss attributable to shareholders of $2.1 million for the year ended December 31, 2015, and (v) net loss increased and deferred income taxes decreased within the cash flows from operating activities by $2.1 million resulting in no change to cash flows from operating activities for the year ended December 31, 2015. The Company has determined that the impact on its previously issued financial statements was not material. Use of Non-GAAP Financial Measures This press release and the accompanying tables include references to adjusted EBITDA, non-GAAP EPS, non-GAAP net income and adjusted cash from operations, which are non-GAAP financial measures. For a description of these non-GAAP financial measures, including the reasons management uses these measures, please see the section following the accompanying tables titled “Exhibit A: Non-GAAP Financial Measures”. For a reconciliation of these non-GAAP financial measures to the most directly comparable financial measures prepared in accordance with GAAP, please see Other Non-GAAP Disclosures and Non-GAAP Financial Guidance in the accompanying tables. Founded in 2000, Ameresco, Inc. (NYSE:AMRC) is a leading independent provider of comprehensive services, energy efficiency, infrastructure upgrades, asset sustainability and renewable energy solutions for businesses and organizations throughout North America and Europe. Ameresco’s sustainability services include upgrades to a facility’s energy infrastructure and the development, construction and operation of renewable energy plants. Ameresco has successfully completed energy saving, environmentally responsible projects with federal, state and local governments, healthcare and educational institutions, housing authorities, and commercial and industrial customers. With its corporate headquarters in Framingham, MA, Ameresco has more than 1,000 employees providing local expertise in the United States, Canada, and the United Kingdom. For more information, visit www.ameresco.com. Any statements in this press release about future expectations, plans and prospects for Ameresco, Inc., including statements about market conditions, pipeline and backlog, as well as estimated future revenues and net income, and other statements containing the words “projects,” “believes,” “anticipates,” “plans,” “expects,” “will” and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including the timing of, and ability to, enter into contracts for awarded projects on the terms proposed; the timing of work we do on projects where we recognize revenue on a percentage of completion basis, including the ability to perform under recently signed contracts without unusual delay; demand for our energy efficiency and renewable energy solutions; our ability to arrange financing for our projects; changes in federal, state and local government policies and programs related to energy efficiency and renewable energy; the ability of customers to cancel or defer contracts included in our backlog; the effects of our recent acquisitions and restructuring activities; seasonality in construction and in demand for our products and services; a customer’s decision to delay our work on, or other risks involved with, a particular project; availability and costs of labor and equipment; the addition of new customers or the loss of existing customers; market price of the Company's stock prevailing from time to time; the nature of other investment opportunities presented to the Company from time to time; the Company's cash flows from operations; and other factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2015, filed with the U.S. Securities and Exchange Commission on March 4, 2016 and in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2016, filed with the U.S. Securities and Exchange Commission on May 5, 2016. In addition, the forward-looking statements included in this press release represent our views as of the date of this press release. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date of this press release. (1) Represents estimated future revenues from projects that have been awarded, though the contracts have not yet been signed. We use the non-GAAP financial measures defined and discussed below to provide investors and others with useful supplemental information to our financial results prepared in accordance with GAAP. These non-GAAP financial measures should not be considered as an alternative to any measure of financial performance calculated and presented in accordance with GAAP. For a reconciliation of these non-GAAP measures to the most directly comparable financial measures prepared in accordance with GAAP, please see Other Non-GAAP Disclosure and Non-GAAP Financial Guidance in the tables above. We understand that, although measures similar to these non-GAAP financial measures are frequently used by investors and securities analysts in their evaluation of companies, they have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for the most directly comparable GAAP financial measures or an analysis of our results of operations as reported under GAAP. To properly and prudently evaluate our business, we encourage investors to review our GAAP financial statements included above, and not to rely on any single financial measure to evaluate our business. We define adjusted EBITDA as operating income before depreciation, amortization of intangible assets, stock-based compensation expense, restructuring charges, loss related to a significant non-core project in Canada and charges related to a significant customer bankruptcy. We believe adjusted EBITDA is useful to investors in evaluating our operating performance for the following reasons: adjusted EBITDA and similar non-GAAP measures are widely used by investors to measure a company's operating performance without regard to items that can vary substantially from company to company depending upon financing and accounting methods, book values of assets, capital structures and the methods by which assets were acquired; securities analysts often use adjusted EBITDA and similar non-GAAP measures as supplemental measures to evaluate the overall operating performance of companies; and by comparing our adjusted EBITDA in different historical periods, investors can evaluate our operating results without the additional variations of depreciation and amortization expense, stock-based compensation expense, restructuring charges and loss related to a significant non-core project in Canada. We define adjusted EBITDA margin as adjusted EBITDA stated as a percentage of revenue. Our management uses adjusted EBITDA and adjusted EBITDA margin as measures of operating performance, because they do not include the impact of items that we do not consider indicative of our core operating performance; for planning purposes, including the preparation of our annual operating budget; to allocate resources to enhance the financial performance of the business; to evaluate the effectiveness of our business strategies; and in communications with the board of directors and investors concerning our financial performance. During the first quarter of 2016, we changed our calculation and presentation of adjusted EBITDA to exclude restructuring charges and losses related to a significant non-core project in Canada and during the third quarter of 2016, we changed our calculation and presentation of adjusted EBITDA in order to exclude charges related to a significant customer bankruptcy. We do not consider these items indicative of our core operating performance. Adjusted EBITDA and adjusted EBITDA margin for the prior periods have been recalculated to be presented on a comparable basis. We define non-GAAP net income and earnings per share ("EPS") to exclude certain discrete items that management does not consider representative of our ongoing operations, including restructuring charges, loss related to a significant non-core project in Canada and loss attributable to redeemable non-controlling interest. We consider non-GAAP net income to be an important indicator of our operational strength and performance of our business because it eliminates the effects of events that are not part of the Company's core operations. We define adjusted cash from operations as cash flows from operating activities plus proceeds from Federal ESPC projects. Cash received in payment of Federal ESPC projects is treated as a financing cash flow under GAAP due to the unusual financing structure for these projects. These cash flows, however, correspond to the revenue generated by these projects. Thus we believe that adjusting operating cash flow to include the cash generated by our Federal ESPC projects provides investors with a useful measure for evaluating the cash generating ability of our core operating business. Our management uses adjusted cash from operations as a measure of liquidity because it captures all sources of cash associated with our revenue generated by operations.
News Article | February 23, 2017
For the first time a "tipping point" molecular link between the blood sugar glucose and Alzheimer's disease has been established by scientists, who have shown that excess glucose damages a vital enzyme involved with inflammation response to the early stages of Alzheimer's. Abnormally high blood sugar levels, or hyperglycaemia, is well-known as a characteristic of diabetes and obesity, but its link to Alzheimer's disease is less familiar. Diabetes patients have an increased risk of developing Alzheimer's disease compared to healthy individuals. In Alzheimer's disease abnormal proteins aggregate to form plaques and tangles in the brain which progressively damage the brain and lead to severe cognitive decline. Scientists already knew that glucose and its break-down products can damage proteins in cells via a reaction called glycation but the specific molecular link between glucose and Alzheimer's was not understood. But now scientists from the University of Bath Departments of Biology and Biochemistry, Chemistry and Pharmacy and Pharmacology, working with colleagues at the Wolfson Centre for Age Related Diseases, King's College London, have unraveled that link. By studying brain samples from people with and without Alzheimer's using a sensitive technique to detect glycation, the team discovered that in the early stages of Alzheimer's glycation damages an enzyme called MIF (macrophage migration inhibitory factor) which plays a role in immune response and insulin regulation. MIF is involved in the response of brain cells called glia to the build-up of abnormal proteins in the brain during Alzheimer's disease, and the researchers believe that inhibition and reduction of MIF activity caused by glycation could be the 'tipping point' in disease progression. It appears that as Alzheimer's progresses, glycation of these enzymes increases. The study is published in the journal Scientific Reports. Professor Jean van den Elsen, from the University of Bath Department of Biology and Biochemistry, said: "We've shown that this enzyme is already modified by glucose in the brains of individuals at the early stages of Alzheimer's disease. We are now investigating if we can detect similar changes in blood. "Normally MIF would be part of the immune response to the build-up of abnormal proteins in the brain, and we think that because sugar damage reduces some MIF functions and completely inhibits others that this could be a tipping point that allows Alzheimer's to develop. Dr Rob Williams, also from the Department of Biology and Biochemistry, added: "Knowing this will be vital to developing a chronology of how Alzheimer's progresses and we hope will help us identify those at risk of Alzheimer's and lead to new treatments or ways to prevent the disease. Dr Omar Kassaar, from the University of Bath, added: "Excess sugar is well known to be bad for us when it comes to diabetes and obesity, but this potential link with Alzheimer's disease is yet another reason that we should be controlling our sugar intake in our diets." Globally there are around 50 million people with Alzheimer's disease, and this figure is predicted to rise to more than 125 million by 2050. The global social cost of the disease runs into the hundreds of billions of dollars as alongside medical care patients require social care because of the cognitive effects of the disease. The study was funded by the Dunhill Medical Trust. Human brain tissue for this study was provided through Brains for Dementia Research, a joint initiative between Alzheimer's Society and Alzheimer's Research UK in association with the Medical Research Council. For further information, please contact Chris Melvin in the University of Bath Press Office on +44 (0)1225 386 319 or firstname.lastname@example.org Copies of the paper available on request. The University of Bath celebrates its 50th anniversary this year as one of the UK's leading universities both in terms of research and our reputation for excellence in teaching, learning and graduate prospects. In the REF 2014 research assessment 87 per cent of our research was defined as 'world-leading' or 'internationally excellent'. From making aircraft more fuel efficient, to identifying infectious diseases more quickly, or cutting carbon emissions through innovative building solutions, research from Bath is making a difference around the world. Find out more: http://www. Well established as a nurturing environment for enterprising minds, Bath is ranked highly in all national league tables. We were chosen as the UK's top university in the Times Higher Education Student Experience Survey 2015. The Dunhill Medical Trust is a charity which supports innovation in the care of older people and research into the causes and treatments of disease, disability and frailty related to ageing. It welcomes high quality grant applications, particularly those within the following areas: care of older people, including rehabilitation and palliative care; and research into the causes and treatments of disease, disability and frailty related to ageing. The Dunhill Medical Trust is a grant-making charitable company limited by guarantee (company no. 7472301; charity no. 1140372). It is a member of the Association of Medical Research Charities (AMRC) and a recognised charity partner of the National Institute for Health Research (NIHR).
News Article | September 30, 2016
« Ricardo and AMRC sign MoU as work starts on powertrain electrification projects | Main | Toyota introduces C-HR hybrid at Paris » Ballard Power Systems announced the commissioning and deployment of an initial 12 fuel cell-powered buses in the District of Sanshui, in the City of Foshan, in the Province of Guangdong, China. The buses will be operated by Foshan Sanshui Guohong Public Transit Co. Ltd., on demonstration route #682 from Gaofeng Park Station to Shuidu Industrial Park Station. The buses are 11 meters in length and feature advanced safety systems, 80-person capacity, anticipated driving range in excess of 300 kilometers (186 miles), expected hydrogen gas consumption of less than 6.5 kilograms per 100 kilometers, zero tailpipe emissions and remote monitoring. Unlike many battery electric bus routes, the transit route in Foshan will not require any catenary wires or on-route recharging. In September 2015 we announced the planned deployment of 300 fuel cell-powered buses in Foshan/Yunfu. Our program consortium has made considerable progress over the past year, including localization of Ballard-designed fuel cell engines, establishment of a fuel cell bus manufacturing facility, local procurement activities, development of systems integration capabilities, national permitting of a fuel cell bus platform, preparations for hydrogen refueling infrastructure and development of our China service team. Now the first installment of zero-emission fuel cell buses is hitting the roads in Foshan, with the commissioning of an initial 12 buses in passenger service. This marks the largest deployment of fuel cell buses in China’s history. The Foshan and Yunfu governments are demonstrating strong vision and leadership by solving a growing need for mass urban transit while responsibly addressing local air quality and stimulating local economic development. Guangdong Nation Synergy Hydrogen Power Technology Co. Ltd. (“Synergy”), providing 85 kilowatt fuel cell engines designed by Ballard; Shanghai Reinventing Fire Technology Company Limited (“Re-Fire”), a leading Chinese fuel cell vehicle systems integrator that has integrated the fuel cell engines into the Feichi buses; and Zhangjiagang Furui Special Equipment Co., Ltd. (“Furuise”), a Chinese leader in liquefying, storage, transit and application of liquefied naturalgas, including LNG and CNG vehicle gas filling stations and is expected to be the provider of hydrogen refueling infrastructure.
News Article | September 30, 2016
« Infiniti unveils I4 Variable Compression Turbo engine; targeting 27% improvement in fuel efficiency over V6 engines of similar output | Main | Commissioning of initial 12 Ballard-powered buses in China’s largest fuel cell bus deployment » The University of Sheffield Advanced Manufacturing Research Centre (AMRC) has entered into a Memorandum of Understanding (MoU) with global engineering company Ricardo. A primary theme of this collaboration will be powertrain electrification, which will be addressed by Ricardo and the AMRC jointly. This will be alongside the development of motors, batteries and power electronics, said AMRC’s Automotive Sector Lead, Ben Kitcher. As global specialists in transport, security, energy, scarce resources and waste, Ricardo has extensive experience of working within a variety of ground transportation sectors, such as automotive, commercial and industrial vehicles, motorsport, motorcycles and rail. The AMRC aims to develop innovative products and manufacturing methods for the automotive and vehicle production industry that will increase capacity, capability and competitiveness for UK companies. The group’s longer term goal is to maintain the UK automotive industry as a world leader in advanced low emission powertrain and vehicle production. The MoU builds on a relationship between the AMRC and Ricardo, which started with Ricardo sponsoring a programme of doctoral students supported by the University of Sheffield’s Faculty of Engineering and AMRC. These studentships are jointly investigating electric motor design and manufacture.