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Boralex: Significantly higher results for the second quarter

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MONTREAL, Aug. 7, 2013 /PRNewswire/ - Delivering on its growth strategy, Boralex Inc.  ("Boralex" or the "Corporation")(TSX: BLX) reported improved financial results for the second quarter of 2013, with a 23% increase in earnings before income taxes, interest and amortization ("EBITDA").

FINANCIAL HIGHLIGHTS

         
(In millions of dollars, except per share amounts and EBITDA margin) 
Three-month periods
ended June 30

Six-month periods
ended June 30

 

2013

2012

2013

2012
Revenues from energy sales 40.1 38.9 90.9 96.4
EBITDA 23.2 18.9 56.4 52.2
EBITDA margin (%) 57.9 48.6 62.0 54.1
Net earnings (loss)(1) (1.7) (6.0) 2.3 (1.2)

Per share (basic) ($)(1) (0.04) (0.16) 0.06 (0.03)
Cash flows from operations(2) 17.8 5.5 40.7 27.4

Per share (basic) ($)(2) 0.47 0.15 1.08 0.73

(1)  Attributable to shareholders of Boralex for continuing operations
(2) Given that June 30, the scheduled date for payment of $8.3 million in interest on convertible debentures, fell on a Sunday before a statutory holiday, the payment was made on July 2, 2013. Adjusted cash flows from operations are thus $9.5 million.

The improvement in the Corporation's performance in the second quarter of 2013 resulted in large part from the contribution of the St-Patrick wind farm in France acquired in June 2012, as well as from better wind conditions in Canada and more favourable water flows in the U.S., which more than offset the impact of the shutdown of operations at the Kingsey Falls thermal power station. In the second quarter of 2013, these positive factors sparked improvements in the Corporation's production, revenues from energy sales, EBITDA and cash flows from operations(2) of 9%, 3%, 23% and 73%, respectively, compared with the same period of 2012.

In the second quarter of 2013, Boralex closed US$90 million in long-term financing secured by two of its U.S. power stations which will allow the Corporation to repay a US$70.7 million existing loan facility and free up funds to support its development. This non-recourse financing will bear interest at an annual rate of 3.51% and will be amortized by semi-annual payments over a 12-year period.

A GROWING COMPANY: SEVERAL SITES UNDER CONSTRUCTION

The Corporation continues to develop several projects in Canada and France, which will significantly influence its asset profile in the next few years. "Construction of Phase I of the Seigneurie de Beaupré Wind Farms is still on schedule despite a one-week work shutdown caused by a general strike in Québec's construction industry last June," said Boralex President and CEO Patrick Lemaire. The first 272 MW will be commissioned in December 2013 followed by an additional 68 MW with the Phase II in December 2014. Elsewhere in Canada, construction is expected to begin on the Témiscouata I wind farm in the third quarter. Work is on schedule at the Jamie Creek hydroelectric site, which the Corporation expects to commission in early 2014.

In France, construction continues at the La Vallée and Vron wind farms, with commissioning still scheduled for late 2013. The Corporation is currently actively working at finalizing the financing for the Fortel-Bonnières and St-François projects.

As of June 30, 2013, Boralex can count on $128 million in available cash to fuel its growth.

About Boralex
Boralex is a power producer whose core business is dedicated to the development and the operation of renewable energy power stations. Currently, the Corporation operates an asset base with an installed capacity of almost 500 MW in Canada, the Northeastern United States and France. Boralex is also committed under power development projects, both independently and with Canadian and European partners, to add approximately 550 MW of power that will be put in service by the end of 2015. With more than 200 employees, Boralex is known for its diversified expertise and in-depth experience in four power generation types — wind, hydroelectric, thermal and solar. Boralex's shares and convertible debentures are listed on the Toronto Stock Exchange under the ticker symbols BLX and BLX.DB, respectively. More information is available at www.boralex.com or www.sedar.com.

Certain statements contained in this press release, including those regarding future results and performance, are forward‑looking statements based on current expectations, within the meaning of securities legislation. Boralex would like to point out that, by their very nature, forward-looking statements involve risks and uncertainties such that its results or the measures it adopts could differ materially from those indicated by or underlying these statements, or could have an impact on the degree of realization of a particular projection. The main factors that could lead to a material difference between the Corporation's actual results and the projections or expectations set forth in the forward-looking statements include, but are not limited to, the general impact of economic conditions, raw material price increases and availability, currency fluctuations, volatility in the selling price of electricity, the Corporation's financing capacity, negative changes in general market conditions and regulations affecting the industry, as well as other factors discussed in the Corporation's filings with the various securities commissions.

There can be no assurance as to the materialization of the results, performance or achievements as expressed or implied by forward-looking statements. The reader is cautioned not to place undue reliance on such forward-looking statements. Unless required to do so under applicable securities legislation, Boralex management does not assume any obligation to update or revise forward-looking statements to reflect new information, future events or other changes.

The summarized financial statements included in this press release also contain certain non-IFRS financial measures. In order to assess the performance of its assets and reporting segments, Boralex uses EBITDA, cash flows from operations, the ratio of net debt, adjusted EBITDA and adjusted net earnings, as performance measures. Management believes that these measures are financial indicators widely accepted by investors to assess the operational performance of a company and its ability to generate cash through operations. These non-IFRS measures are drawn primarily from the unaudited interim condensed consolidated financial statements accompanying this press release, but do not have a standardized meaning under IFRS; accordingly, they may not be comparable to similarly named measures used by other companies.

Consolidated Financial Statements
Consolidated Statements of Financial Position

  As at
June 30,
As at
December 31,
(in thousands of Canadian dollars) (unaudited) 2013 2012
ASSETS    
Cash and cash equivalents 122,214 107,138
Restricted cash 6,107 5,063
Trade and other receivables 30,998 45,589
Inventories 4,631 4,404
Available-for-sale financial asset 3,009
Prepaid expenses 4,087 2,137
CURRENT ASSETS 168,037 167,340
     
Property, plant and equipment 733,978 689,024
Other intangible assets 262,113 253,115
Goodwill 49,246 48,663
Interest in the Joint Venture 72,822 58,994
Other non-current financial assets 320
Other non-current assets 12,402 12,735
NON-CURRENT ASSETS 1,130,881 1,062,531
TOTAL ASSETS 1,298,918 1,229,871
LIABILITIES    
Trade and other payables 55,169 46,945
Current portion of debt 104,548 98,570
Current income tax liability 2,446 1,741
Other current financial liabilities 17,994 25,508
CURRENT LIABILITIES 180,157 172,764
     
Non-current debt 444,717 423,616
Convertible debentures 227,872 226,299
Deferred income tax liability 37,859 29,514
Other non-current financial liabilities 19,893 24,698
Other non-current liabilities 11,259 10,611
NON-CURRENT LIABILITIES 741,600 714,738
TOTAL LIABILITIES 921,757 887,502
EQUITY    
Equity attributable to shareholders 351,628 319,868
Non-controlling shareholders 25,533 22,501
TOTAL EQUITY 377,161 342,369
TOTAL LIABILITIES AND EQUITY 1,298,918 1,229,871


Consolidated Statements of Earnings (Loss)

  Three-month periods
ended June 30
Six-month periods
ended June 30
(in thousands of Canadian dollars, except per share amounts) (unaudited) 2013 2012 2013 2012
REVENUES        
Revenues from energy sales 40,141 38,905 90,877 96,356
Other income 437 171 752 322
  40,578 39,076 91,629 96,678
         
COSTS AND OTHER EXPENSES        
Operating expenses 11,975 14,646 24,824 35,072
Administrative 3,639 3,746 7,236 6,951
Development 872 1,797 2,009 2,468
Amortization 13,213 13,954 26,714 27,890
Other gains (48) (82)
Impairment of property, plant and equipment and intangible assets 266 266 823
  29,917 34,143 60,967 73,204
         
OPERATING INCOME 10,661 4,933 30,662 23,474
         
Financing costs 12,595 12,096 25,019 24,199
Foreign exchange loss (gain) (138) 10 (146) 131
Net loss (gain) on financial instruments (876) 822 (673) 485
Share in earnings (loss) of the Joint Venture (899) (27) (1,114) 17
         
EARNINGS (LOSS) BEFORE INCOME TAXES (1,819) (8,022) 5,348 (1,324)
         
Income tax expense (recovery) (176) (1,723) 2,554 38
         
NET EARNINGS (LOSS) FROM CONTINUING OPERATIONS (1,643) (6,299) 2,794 (1,362)
         
Net earnings from discontinued operations 622 134 783 2,459
NET EARNINGS (LOSS) (1,021) (6,165) 3,577 1,097
         
NET EARNINGS (LOSS) ATTRIBUTABLE TO:        
  Shareholders of Boralex (1,063) (5,901) 3,105 1,248
  Non-controlling shareholders 42 (264) 472 (151)
NET EARNINGS (LOSS) (1,021) (6,165) 3,577 1,097
         
NET EARNINGS (LOSS) ATTRIBUTABLE TO SHAREHOLDERS OF BORALEX        
  Continuing operations (1,685) (6,035) 2,322 (1,211)
  Discontinued operations 622 134 783 2,459
  (1,063) (5,901) 3,105 1,248
         
NET EARNINGS (LOSS) PER SHARE (BASIC AND DILUTED) ATTRIBUTABLE TO SHAREHOLDERS OF BORALEX        
  Continuing operations ($0.04) ($0.16) $0.06 ($0.03)
  Discontinued operations $0.02 $0.02 $0.06
  ($0.02) ($0.16) $0.08 $0.03


Consolidated Statements of Comprehensive Income (Loss)

  Three-month periods
ended June 30
Six-month period
ended June 30
(in thousands of Canadian dollars) (unaudited) 2013 2012 2013 2012
NET EARNINGS (LOSS) (1,021) (6,165) 3,577 1,097
         
Other comprehensive income (loss) to be subsequently reclassified to net earnings when certain conditions are met        
Translation adjustments:        
  Unrealized foreign exchange gain (loss) on translation of financial statements of self-sustaining foreign operations 8,652 334 9,633 (1,051)
Cash flow hedges:        
  Change in fair value of financial instruments 8,792 (7,294) 9,049 (8,842)
  Hedging items realized and recognized in net earnings (loss) 1,927 3,687 3,778 7,826
  Taxes (3,155) 985 (3,805) 572
Cash flow hedges - Joint Venture:        
  Change in fair value of financial instruments 15,555 (11,112) 14,942 (3,350)
  Taxes (3,948) 2,955 (3,869) 891
Available-for-sale financial asset:        
  Change in fair value of an available-for-sale financial asset 11 (387) 800 (451)
  Items realized and recognized in net earnings (loss) (54) (91)
Total other comprehensive income (loss) 27,780 (10,832) 30,437 (4,405)
COMPREHENSIVE INCOME (LOSS) 26,759 (16,997) 34,014 (3,308)
         
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO:        
  Shareholders of Boralex 24,570 (16,194) 31,308 (2,593)
  Non-controlling shareholders 2,189 (803) 2,706 (715)
COMPREHENSIVE INCOME (LOSS) 26,759 (16,997) 34,014 (3,308)
         
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO SHAREHOLDERS OF BORALEX        
  Continuing operations 23,948 (16,329) 30,525 (5,052)
  Discontinued operations 622 135 783 2,459
  24,570 (16,194) 31,308 (2,593)


Consolidated Statements of Changes in Equity

              Six-month period
ended June 30
                2013
  Equity attributable to shareholders    
(in thousands of Canadian dollars) (unaudited) Capital
stock
Equity
component of
convertible
debentures
Contributed
surplus
Retained
earnings
Other
comprehensive
income (loss)
Total Non-
controlling
shareholders
Total
equity
BALANCE AS AT JANUARY 1, 2013 222,870 14,379 6,945 144,492 (68,818) 319,868 22,501 342,369
                 
Net earnings 3,105 3,105 472 3,577
Other comprehensive income 28,203 28,203 2,234 30,437
COMPREHENSIVE INCOME 3,105 28,203 31,308 2,706 34,014
                 
Conversion of convertible debentures 56 56 56
Exercise of options 30 30 30
Stock option expense 366 366 366
Contribution of non-controlling shareholders 326 326
BALANCE AS AT JUNE 30, 2013 222,956 14,379 7,311 147,597 (40,615) 351,628 25,533 377,161
                 
                 
              Six-month period
ended June 30
                2012
  Equity attributable to shareholders    
(in thousands of Canadian dollars) (unaudited) Capital
stock
Equity
component of
convertible
debentures
Contributed
surplus
Retained
earnings
Other
comprehensive
loss
Total Non-
controlling
shareholders
Total
equity
BALANCE AS AT JANUARY 1, 2012 222,758 14,379 6,106 144,501 (65,980) 321,764 7,114 328,878
                 
Net earnings (loss) 1,248 1,248 (151) 1,097
Other comprehensive loss (3,841) (3,841) (564) (4,405)
COMPREHENSIVE INCOME (LOSS) 1,248 (3,841) (2,593) (715) (3,308)
                 
Conversion of convertible debentures 45 45 45
Share repurchases (5) (2) (7) (7)
Stock option expense 313 313 313
Excess of proceeds from partial sale of a subsidiary 4,946 4,946 (4,946)
Contribution of non-controlling shareholders 18,124 18,124
BALANCE AS AT JUNE 30, 2012 222,798 14,379 6,419 150,693 (69,821) 324,468 19,577 344,045


Consolidated Statements of Cash Flows

  Three-month periods
ended June 30
Six-month periods
ended June 30
(in thousands of Canadian dollars) (unaudited) 2013 2012 2013 2012
Net earnings (loss) attributable to shareholders of Boralex (1,063) (5,901) 3,105 1,248
Less: Net earnings from discontinued operations 622 134 783 2,459
Net earnings (loss) from continuing operations attributable to shareholders of Boralex (1,685) (6,035) 2,322 (1,211)
Financing costs 12,595 12,096 25,019 24,199
Interest paid (6,240) (12,973) (16,253) (23,327)
Income tax expense (recovery) (176) (1,723) 2,554 38
Income taxes paid (695) (768) (1,452) (2,464)
Non-cash items in earnings (loss):        
  Net loss (gain) on financial instruments (876) 822 (673) 485
  Share in loss (earnings) of the Joint Venture 899 27 1,114 (17)
  Amortization 13,213 13,954 26,714 27,890
  Impairment of property, plant and equipment and intangible assets 266 266 823
  Other gains (48) (82)
  Other 522 107 1,200 940
  17,775 5,507 40,729 27,356
Change in non-cash items related to operating activities 13,979 7,731 13,472 18,956
NET CASH FLOWS RELATED TO OPERATING ACTIVITIES 31,754 13,238 54,201 46,312
         
Business acquisitions (39,080) (39,080)
Additions to property, plant and equipment (40,312) (1,048) (48,693) (2,543)
Additions to other intangible assets (1,560) (1,560)
Change in restricted cash (289) 10,868 (1,044) 11,628
Increase in interest in the Joint Venture (9,425) (11,283)
Development projects (7,913) (910) (8,890) (1,656)
Proceeds from sale of assets 8,763 8,763
Other 292 (19) 96
NET CASH FLOWS RELATED TO INVESTING ACTIVITIES (48,514) (32,100) (58,646) (35,635)
         
Increase in non-current debt 24,351 29,115
Repayments on non-current debt (4,716) (2,591) (13,983) (14,667)
Contribution of non-controlling shareholders 18,124 326 18,124
Other 30 (60) 30 (48)
NET CASH FLOWS RELATED TO FINANCING ACTIVITIES 19,665 15,473 15,488 3,409
Cash from discontinued operations 968 (1,232) 1,066 (5,479)
TRANSLATION ADJUSTMENT ON CASH AND CASH EQUIVALENTS 2,604 318 2,967 (196)
NET CHANGE IN CASH AND CASH EQUIVALENTS 6,477 (4,303) 15,076 8,411
         
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD 115,737 157,417 107,138 144,703
CASH AND CASH EQUIVALENTS - END OF PERIOD 122,214 153,114 122,214 153,114

Segmented Information

The Corporation's power stations are grouped into four distinct operating segments - wind, hydroelectric, thermal and solar power. The Corporation operates under one reportable segment: power generation. The classification of these segments is based on the different cost structures relating to each of the four types of power stations. The same accounting rules are used for segmented information as for the consolidated accounts.

The operating segments are presented according to the same criteria used to prepare the internal report submitted to the segment leader who allocates resources and assesses operating segment performance. The President and Chief Executive Officer is considered the segment leader, who assesses segment performance based on power production, revenues from energy sales, EBITDA and the cash flow from operations.

EBITDA does not have a standardized meaning under IFRS; accordingly, it may not be comparable to similarly named measures used by other companies. Investors should not view EBITDA as an alternative measure to, for example, net earnings, or as a measure of operating results, which are IFRS measures.

EBITDA
EBITDA is reconciled to the most comparable IFRS measure, namely, net earnings (loss) attributable to shareholders of Boralex, in the following table:

  Three-month periods
ended June 30
Six-month periods
ended June 30
(in thousands of Canadian dollars) (unaudited) 2013 2012 2013 2012
Net earnings (loss) attributable to shareholders of Boralex (1,063) (5,901) 3,105 1,248
Net earnings from discontinued operations (622) (134) (783) (2,459)
Non-controlling shareholders 42 (264) 472 (151)
Income tax expense (recovery) (176) (1,723) 2,554 38
Net loss (gain) on financial instruments (876) 822 (673) 485
Foreign exchange loss (gain) (138) 10 (146) 131
Financing costs 12,595 12,096 25,019 24,199
Impairment of property, plant and equipment and intangible assets 266 266 823
Other gains (48) (82)
Amortization 13,213 13,954 26,714 27,890
EBITDA 23,193 18,860 56,446 52,204


Cash flows from operations
Cash flows from operations are equal to net cash flows related to operating activities before change in non-cash items related to operating activities. Management uses this measure to assess cash flows generated by the Corporation's operations and its capacity to finance its expansion through those funds. In light of the seasonal nature of the Corporation's operations and development activities, changes in non-cash items can vary considerably. In addition, development activities result in significant changes in Trade and other payables during the construction period, as well as an initial injection of working capital at project start-up. Accordingly, the Corporation considers it more representative not to integrate changes in non-cash items in this performance measure.

Investors should not consider cash flows from operations as an alternative measure to cash flows related to operating activities, which is an IFRS measure.

Cash flows from operations are reconciled to the most comparable IFRS measure, namely, net cash flows related to operating activities, in the following table:

  Three-month periods
ended June 30
Six-month periods
ended June 30
(in thousands of Canadian dollars) (unaudited) 2013 2012 2013 2012
Net cash flows related to operating activities 31,754 13,238 54,201 46,312
Change in non-cash items related to operating activities 13,979 7,731 13,472 18,956
CASH FLOWS FROM OPERATIONS * 17,775 5,507 40,729 27,356
* As the scheduled payment date of the $8,258,000 interest on the convertible debentures was on June 30,
a Sunday, the payment was made on the following business day on July 2, 2013

Adjusted EBITDA
The following two tables reconcile wind segment EBITDA and consolidated EBITDA as reported in the financial statements with adjusted EBITDA:

  Three-month periods
ended June 30
Six-month periods
ended June 30
(in thousands of Canadian dollars) (unaudited) 2013 2012 2013 2012
EBITDA - Wind power segment 15,569 13,082 35,444 30,059
Specific item:        
  Non-EBITDA items included in the Share in earnings (loss) of the Joint Venture 870 2 1,029 (100)
ADJUSTED EBITDA - WIND POWER SEGMENT 16,439 13,084 36,473 29,959
         
         
  Three-month periods
ended June 30
Six-month periods
ended June 30
(in thousands of Canadian dollars) (unaudited) 2013 2012 2013 2012
EBITDA - Consolidated 23,193 18,860 56,446 52,204
Specific items:        
  Non-EBITDA items included in the Share in earnings (loss) of the Joint Venture 870 2 1,029 (100)
  Professional fees incurred in connection with acquisitions in France and Canada 122 832 129 832
ADJUSTED EBITDA - CONSOLIDATED 24,185 19,694 57,604 52,936


Adjusted net earnings (loss)
The following table reconciles net earnings (loss) attributable to shareholders of Boralex as reported in the financial statements with adjusted net earnings (loss):

  Three-month periods
ended June 30
Six-month periods
ended June 30
(in thousands of Canadian dollars) (unaudited) 2013 2012 2013 2012
Net earnings (loss) attributable to shareholders of Boralex (1,063) (5,901) 3,105 1,248
Net earnings from discontinued operations (622) (134) (783) (2,459)
Specific items*:        
  Impairment of property, plant and equipment and intangible assets 195 195 492
  Professional fees incurred in connection with acquisitions in France and Canada 89 557 95 557
ADJUSTED NET EARNINGS (LOSS) - CONSOLIDATED (1,401) (5,478) 2,612 (162)
* Net of income taxes        


Information by Operating Segment

  Three-month periods
ended June 30
Six-month periods
ended June 30
(in thousands of Canadian dollars, except amounts in MWh) (unaudited) 2013 2012 2013 2012
         
Power production (MWh)        
Wind power stations 166,992 138,836 358,020 311,241
Hydroelectric power stations 197,923 158,874 346,396 321,969
Thermal power stations 7,191 41,981 78,070 160,304
Solar power station 1,788 1,940 2,867 3,269
  373,894 341,631 785,353 796,783
         
Revenues from energy sales        
Wind power stations 20,384 16,345 43,982 36,991
Hydroelectric power stations 15,691 12,445 29,804 26,431
Thermal power stations 3,268 9,285 15,814 31,528
Solar power station 798 830 1,277 1,406
  40,141 38,905 90,877 96,356
         
EBITDA        
Wind power stations 15,569 13,082 35,444 30,059
Hydroelectric power stations 12,532 9,056 23,816 19,701
Thermal power stations (1,070) 1,154 3,598 9,549
Solar power station 706 723 1,088 1,218
Corporate and eliminations (4,544) (5,155) (7,500) (8,323)
  23,193 18,860 56,446 52,204
         
Additions to property, plant and equipment        
Wind power stations 28,176 273 32,635 620
Hydroelectric power stations 10,964 348 13,169 537
Thermal power stations 226 273 66
Solar power station 3 527 696
Corporate and eliminations 946 424 2,089 624
  40,312 1,048 48,693 2,543
         
      As at
June 30,
As at
December 31,
(in thousand of Canadian dollars) (unaudited)     2013 2012
         
Total assets        
Wind power stations     706,720 646,065
Hydroelectric power stations     442,681 420,553
Thermal power stations     46,618 79,093
Solar power station     21,343 20,768
Corporate     81,556 63,392
      1,298,918 1,229,871
         
Total liabilities        
Wind power stations     484,756 464,977
Hydroelectric power stations     148,841 147,795
Thermal power stations     10,066 11,487
Solar power station     16,632 16,438
Corporate     261,462 246,805
      921,757 887,502


Information by Geographic Segment

  Three-month periods
ended June 30
Six-month period
ended June 30
(in thousands of Canadian dollars, except amounts in MWh) (unaudited) 2013 2012 2013 2012
         
Power production (MWh)        
Canada 133,726 165,103 310,930 392,055
United States 123,443 85,996 222,011 199,469
France 116,725 90,532 252,412 205,259
  373,894 341,631 785,353 796,783
         
Revenues from energy sales        
Canada 14,074 19,297 35,915 50,468
United States 9,493 6,497 17,833 14,900
France 16,574 13,111 37,129 30,988
  40,141 38,905 90,877 96,356
         
EBITDA        
Canada 6,232 8,123 20,861 25,450
United States 7,556 4,605 14,288 11,252
France 9,405 6,132 21,297 15,502
  23,193 18,860 56,446 52,204
         
Additions to property, plant and equipment        
Canada 12,158 761 15,486 1,126
United States 167 210 85
France 27,987 287 32,997 1,332
  40,312 1,048 48,693 2,543
         
      As at
June 30,
As at
December 31,
(in thousand of Canadian dollars) (unaudited)      2013 2012
         
Total assets        
Canada     665,121 651,146
United States     195,494 178,329
France     438,303 400,396
      1,298,918 1,229,871
         
Non-current assets, excluding interest in the Joint Venture        
Canada     512,302 498,019
United States     149,455 145,604
France     396,302 359,914
      1,058,059 1,003,537
         
Total liabilities        
Canada     499,483 497,855
United States     100,006 94,461
France     322,268 295,186
      921,757 887,502


Subsequent Event

Seigneurie de Beaupré 4

On July 5, 2013, Boralex transferred assets amounting to $6,382,000 to Seigneurie de Beaupré 4 Wind Farm GP, located in Canada, as a capital contribution in exchange for partnership units.

In May 2013, in connection with the Seigneurie de Beaupré 4 wind farm project, Boralex entered into a partnership agreement with a subsidiary of Gaz Métro L.P. and created the partnership of which each party owns 50%. Under the agreement, all expenditures are made jointly and all earnings, costs, expenses, liabilities, obligations and risks resulting from the partnership are shared jointly but not severally. Boralex's interest in the partnership is accounted for using the equity method. The year-end date is December 31.

Vron

In August 2013, the Corporation closed long-term project financing for the Vron wind farm project in France. Disbursements will be made in August 2013. The loan, which is secured by the assets of this wind farm, comprises four tranches totalling €14,150,000 ($19 373 000). The loan will be amortized in quarterly payments over a 15-year period. The Corporation has used interest rate swaps to set a fixed rate of 4% for the total debt over the loan term, thereby reducing its exposure to rate fluctuations.

Jamie Creek

In August 2013, the Corporation closed long-term project financing for the Jamie Creek hydroelectric power station project in Canada. Disbursements will be made in August 2013. The loan, without recourse to the Corporation, is secured by the assets of this hydroelectric power station and totals $55,250,000. The loan will enjoy a nine-year grace period for repayment of principal and be amortized thereafter, in semi-annual payments, over a 31-year period. The interest rate on the financing is fixed at 5.42% over the loan term.

SOURCE BORALEX INC.



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