AES Announces Settlement of Outstanding Receivables at Maritza in Bulgaria; Reaffirms its Full Year 2016 Guidance
April 27 2016 - 6:00AM
Business Wire
The AES Corporation (NYSE: AES) announced that one of its
subsidiaries, AES 3C Maritza East I (Maritza) in Bulgaria, has
received €309 million ($350 million) in outstanding receivables
from NEK, the state-owned wholesale power company. This payment was
related to the amendment to Maritza’s Power Purchase Agreement
(PPA) signed in August 2015. Maritza will use the majority of the
proceeds to pay the local coal mine that supplies the plant, as
well as repay the lenders of the plant’s non-recourse debt.
“As a direct result of the steps taken by the Government of
Bulgaria to strengthen the financial position of NEK, Maritza has
received full payment of its outstanding receivables,” said Andrés
Gluski, AES President and Chief Executive Officer. “Maritza is one
of the most reliable and cleanest coal-fired plants in Europe,
using only domestically sourced fuel. By meeting all of its
contractual obligations, Bulgaria is sending a very positive sign
to all foreign investors in the country.”
Under the amendment, both parties agreed to make certain changes
to the PPA, including reducing the capacity payment to Maritza by
14 percent through 2026, the PPA term. In exchange, NEK agreed to
pay Maritza its full outstanding receivables. These terms were
previously incorporated in the Company’s 2016 guidance and
2017-2018 expectations.
“The resolution at Maritza is another step in our efforts to
improve the stability of our financial results,” said Tom O’Flynn,
AES Executive Vice President and Chief Financial Officer. “With our
progress to-date and our outlook for the remainder of 2016, we
remain on track to deliver on our financial and strategic
objectives.”
The Company also announced that it is reaffirming its 2016
guidance for all metrics. However, the Company expects its first
quarter 2016 Adjusted EPS results to be significantly below first
quarter 2015 Adjusted EPS of $0.25, which was 20% of full year 2015
Adjusted EPS. First quarter 2016 Adjusted EPS was impacted by a
higher adjusted effective tax rate, primarily as a result of the
enactment of income tax reforms in Chile, as anticipated and
previously included in its guidance. The Company continues to
expect its full year 2016 tax rate to be 31% to 33%. First quarter
2016 results were also impacted by the devaluation of foreign
currencies in Latin America and Europe. The Company is therefore
reaffirming its full year 2016 Adjusted EPS guidance range of $0.95
to $1.05.
The Company expects its first quarter 2016 Proportional Free
Cash Flow results to be largely in line with its first quarter 2015
Proportional Free Cash Flow of $265 million, which was 21% of full
year 2015 Proportional Free Cash Flow. The Company is reaffirming
its full year 2016 Proportional Free Cash Flow guidance range of
$1,000 to $1,350 million. The Company is continuing to review its
first quarter 2016 results and will provide an update on its
earnings call scheduled for Monday, May 9, 2016.
About AES
The AES Corporation (NYSE: AES) is a Fortune 200
global power company. We provide affordable, sustainable energy to
17 countries through our diverse portfolio of distribution
businesses as well as thermal and renewable generation facilities.
Our workforce of 21,000 people is committed to operational
excellence and meeting the world’s changing power needs. Our
2015 revenues were $15 billion and we own and
manage $37 billion in total assets. To learn more,
please visit www.aes.com. Follow AES on Twitter
@TheAESCorp.
Safe Harbor Disclosure
This news release contains forward-looking statements within the
meaning of the Securities Act of 1933 and of the Securities
Exchange Act of 1934. Such forward-looking statements include, but
are not limited to, those related to future earnings, growth and
financial and operating performance. Forward-looking statements are
not intended to be a guarantee of future results, but instead
constitute AES’ current expectations based on reasonable
assumptions. Forecasted financial information is based on certain
material assumptions. These assumptions include, but are not
limited to, our accurate projections of future interest rates,
commodity price and foreign currency pricing, continued normal
levels of operating performance and electricity volume at our
distribution companies and operational performance at our
generation businesses consistent with historical levels, as well as
achievements of planned productivity improvements and incremental
growth investments at normalized investment levels and rates of
return consistent with prior experience.
Actual results could differ materially from those projected in
our forward-looking statements due to risks, uncertainties and
other factors. Important factors that could affect actual results
are discussed in AES’ filings with the Securities and Exchange
Commission (the “SEC”), including, but not limited to, the risks
discussed under Item 1A “Risk Factors” and Item 7:
Management’s Discussion & Analysis in AES’ 2015 Annual
Report on Form 10-K and in subsequent reports filed with the SEC.
Readers are encouraged to read AES’ filings to learn more about the
risk factors associated with AES’ business. AES undertakes no
obligation to update or revise any forward-looking statements,
whether as a result of new information, future events or
otherwise.
Any Stockholder who desires a copy of the Company’s 2015 Annual
Report on Form 10-K dated on or about February 23, 2016 with
the SEC may obtain a copy (excluding Exhibits) without charge by
addressing a request to the Office of the Corporate Secretary, The
AES Corporation, 4300 Wilson Boulevard, Arlington, Virginia 22203.
Exhibits also may be requested, but a charge equal to the
reproduction cost thereof will be made. A copy of the Form 10-K may
be obtained by visiting the Company’s website
at www.aes.com.
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The AES CorporationInvestor Contact:Ahmed Pasha
703-682-6451orMedia Contact:Amy Ackerman 703-682-6399
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