Clearway Energy, Inc. Reports Third Quarter 2024 Financial Results
-- Signed agreement with Clearway Group to commit to invest in a 500 MW
solar plus storage project
-- Received offer from Clearway Group to invest in a 320 MW storage
hybridization project
-- Reaffirming 2024 financial guidance and initiating 2025 financial
guidance
-- Increasing the quarterly dividend by 1.7% to $0.4240 per share in the
fourth quarter of 2024, or $1.6960 per share annualized
PRINCETON, N.J., Oct. 30, 2024 (GLOBE NEWSWIRE) -- Clearway Energy, Inc. (NYSE: CWEN, CWEN.A) today reported third quarter 2024 financial results, including Net Income of $27 million, Adjusted EBITDA of $354 million, Cash from Operating Activities of $301 million, and Cash Available for Distribution $(CAFD)$ of $146 million.
"Clearway remains well positioned to meet or exceed its 2024 financial objectives, has initiated a 2025 financial guidance range providing for robust growth, and remains committed to the financial objectives previously outlined through 2026," said Craig Cornelius, Clearway Energy, Inc.'s President and Chief Executive Officer. "With the commitment to Pine Forest and offer to invest in Honeycomb Phase 1, we have further set the stage for sustainable long-term growth. Based on our growth outlook and updated assumptions for levelized resource adequacy pricing, we are targeting CAFD per share of $2.40-2.60 in 2027, which represents approximately 7.5% to 12% annual growth from the midpoint of our 2025 financial guidance. While there is work ahead to achieve the 2027 targets and long-term framework outlined today, the team at Clearway has built a solid foundation for our future as we reach towards the goals we've laid out for the years ahead."
Adjusted EBITDA and Cash Available for Distribution used in this press release are non-GAAP measures and are explained in greater detail under "Non-GAAP Financial Information" below.
Overview of Financial and Operating Results
Segment Results
Table 1: Net Income/(Loss)
($ millions) Three Months Ended Nine Months Ended Segment 9/30/24 9/30/23 9/30/24 9/30/23 -------------- ----------- --------- ---------- --------- Conventional 25 38 50 99 Renewables 66 62 60 112 Corporate (64) (85) (125) (152) --------------- ---- ---- ---- --- ---- ----- Net Income/(Loss) $ 27 $ 15 $ (15) $ 59 =============== ==== ==== ==== === ==== =====
Table 2: Adjusted EBITDA
($ millions) Three Months Ended Nine Months Ended Segment 9/30/24 9/30/23 9/30/24 9/30/23 ------------- ----------- --------- ------------- ----------- Conventional 66 84 174 236 Renewables 295 246 770 645 Corporate (7) (7) (26) (24) -------------- ---- ---- ---- --- ---- ---- Adjusted EBITDA $ 354 $ 323 $ 918 $ 857 -------------- ---- ---- ---- --- ---- ----
Table 3: Cash from Operating Activities and Cash Available for Distribution (CAFD)
Three Months Ended Nine Months Ended
($ millions) 9/30/24 9/30/23 9/30/24 9/30/23
------------- ----------- --------- ----------- -----------
Cash from
Operating
Activities $ 301 $ 287 $ 578 $ 496
Cash Available
for
Distribution
(CAFD) $ 146 $ 156 $ 385 $ 289
-------------- ---- ----- ----- ---- ----- -----
For the third quarter of 2024, the Company reported Net Income of $27 million, Adjusted EBITDA of $354 million, Cash from Operating Activities of $301 million, and CAFD of $146 million. Net Income increased versus 2023 primarily due to non-cash impacts from the mark to market impact of economic hedges and lower tax expenses partially offset by higher interest expense related to interest rate swaps. Adjusted EBITDA results in the third quarter were higher than 2023 primarily due to the contribution of growth investments partially offset by the expiration of El Segundo's tolling agreement in the third quarter of 2023. CAFD results in the third quarter of 2024 were lower than 2023 primarily due to the expiration of El Segundo's tolling agreement partially offset by the contribution of growth investments.
Operational Performance
Table 4: Selected Operating Results(1)
(MWh in thousands) Three Months Ended Nine Months Ended
9/30/24 9/30/23 9/30/24 9/30/23
------------------- ----------- --------- ---------- ----------
Conventional
Equivalent
Availability Factor 87.5% 97.9% 90.3% 87.5%
Solar MWh
generated/sold 2,943 1,822 6,999 4,232
Wind MWh
generated/sold 2,012 2,085 7,478 7,262
--------------------- ----- --- ----- ------ ------
Renewables
generated/sold(2) 4,955 3,907 14,477 11,494
--------------------- ----- --- ----- ------ ------
In the third quarter of 2024, availability at the Conventional segment was lower than the third quarter of 2023 primarily due to outages at certain facilities. Generation in the Renewables segment during the third quarter of 2024 was 27% higher than the third quarter of 2023 primarily due to the contribution of growth investments partially offset by lower wind resource at certain facilities.
Liquidity and Capital Resources
Table 5: Liquidity
($ millions) 9/30/2024 12/31/2023
------------------------------------------ ----------- --------------
Cash and Cash Equivalents:
Clearway Energy, Inc. and Clearway
Energy LLC, excluding subsidiaries $ 90 $ 410
Subsidiaries 202 125
Restricted Cash:
Operating accounts 183 176
Reserves, including debt service,
distributions, performance obligations
and other reserves 199 340
------- --------
Total Cash $ 674 $ 1,051
------- --------
Revolving credit facility availability 592 454
------- --------
Total Liquidity $ 1,266 $ 1,505
======= ========
Total liquidity as of September 30, 2024, was $1,266 million, which was $239 million lower than as of December 31, 2023, primarily due to the execution of growth investments including payments for Cedar Creek, Victory Pass, Arica and the Rosie BESS assets.
As of September 30, 2024, the Company's liquidity included $382 million of restricted cash. Restricted cash consists primarily of funds to satisfy the requirements of certain debt arrangements and funds held within the Company's projects that are restricted in their use. As of September 30, 2024, these restricted funds were comprised of $183 million designated to fund operating expenses, approximately $71 million designated for current debt service payments, and $89 million of reserves for debt service, performance obligations and other items including capital expenditures. The remaining $39 million is held in distribution reserve accounts.
Potential future sources of liquidity include excess operating cash flow, availability under the revolving credit facility, asset dispositions, and, subject to market conditions, new corporate debt and equity financings.
Growth Investments and Strategic Announcements
Pine Forest
On October 28, 2024, the Company, through an indirect subsidiary, entered into agreements to acquire cash and tax equity interests in a 500 MW solar plus storage project currently under construction in Hopkins County, Texas that is expected to reach commercial operations in 2025 for a total investment of $155 million, subject to closing adjustments. Upon achieving commercial operations, the project's solar output is underpinned by power purchase agreements with creditworthy counterparties with a weighted average contract duration of approximately 20 years. The consummation of the transactions are subject to customary closing conditions and certain third-party approvals and is expected in the second half of 2025. The Company expects the projects to contribute asset CAFD on a five-year average annual basis of approximately $16 million beginning January 1, 2026.
Honeycomb Phase 1 Offer
On October 18, 2024, Clearway Group offered the Company the opportunity to enter into partnership arrangements to own cash equity interests in a portfolio of 320 MW storage hybridization projects that is expected to reach commercial operations in 2026. The potential corporate capital commitment for the investment is expected to be approximately $85 million. The investment is subject to negotiation both with Clearway Group, and the review and approval by the Company's Independent Directors.
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