Attached files
file | filename |
---|---|
8-K/A - 8-K/A - Clearway Energy, Inc. | a15-1304_28ka.htm |
EX-23.1 - EX-23.1 - Clearway Energy, Inc. | a15-1304_2ex23d1.htm |
EX-99.1 - EX-99.1 - Clearway Energy, Inc. | a15-1304_2ex99d1.htm |
EX-99.6 - EX-99.6 - Clearway Energy, Inc. | a15-1304_2ex99d6.htm |
EX-23.2 - EX-23.2 - Clearway Energy, Inc. | a15-1304_2ex23d2.htm |
EX-99.3 - EX-99.3 - Clearway Energy, Inc. | a15-1304_2ex99d3.htm |
EX-99.7 - EX-99.7 - Clearway Energy, Inc. | a15-1304_2ex99d7.htm |
EX-23.3 - EX-23.3 - Clearway Energy, Inc. | a15-1304_2ex23d3.htm |
EX-99.5 - EX-99.5 - Clearway Energy, Inc. | a15-1304_2ex99d5.htm |
EX-99.4 - EX-99.4 - Clearway Energy, Inc. | a15-1304_2ex99d4.htm |
Exhibit 99.2
LAREDO RIDGE WIND, LLC
(A Delaware Limited Liability Company)
Financial Statements
(Unaudited)
September 30, 2014
LAREDO RIDGE WIND, LLC
(A Delaware Limited Liability Company)
September 30, 2014
Table of Contents
|
|
Page |
|
|
|
Financial Statements: |
|
|
|
|
|
Balance Sheets |
|
1 |
|
|
|
Statements of Operations |
|
2 |
|
|
|
Statements of Members Equity |
|
3 |
|
|
|
Statements of Cash Flows |
|
4 |
|
|
|
Notes to Financial Statements |
|
5 |
LAREDO RIDGE WIND, LLC
(A Delaware Limited Liability Company)
Balance Sheets
(Amounts in thousands)
|
|
(Successor) |
|
|
(Predecessor) |
| |
|
|
September 30, 2014 |
|
|
December 31, 2013 |
| |
|
|
(Unaudited) |
|
|
|
| |
Assets |
|
|
|
|
|
| |
|
|
|
|
|
|
| |
Current assets: |
|
|
|
|
|
| |
Cash |
|
$ |
1,371 |
|
|
2,911 |
|
Accounts receivable |
|
1,245 |
|
|
1,436 |
| |
Inventory |
|
516 |
|
|
455 |
| |
Prepaid expenses and other current assets |
|
602 |
|
|
140 |
| |
Total current assets |
|
3,734 |
|
|
4,942 |
| |
|
|
|
|
|
|
| |
Wind energy generating system |
|
116,000 |
|
|
187,340 |
| |
Accumulated depreciation |
|
(2,636 |
) |
|
(27,328 |
) | |
Plant and equipment, net |
|
113,364 |
|
|
160,012 |
| |
|
|
|
|
|
|
| |
Deferred financing costs, net |
|
|
|
|
3,055 |
| |
Power purchase agreement, net of accumulated amortization of $1,235 |
|
52,765 |
|
|
|
| |
Long-term restricted cash |
|
|
|
|
334 |
| |
|
|
|
|
|
|
| |
Total assets |
|
$ |
169,863 |
|
|
168,343 |
|
|
|
|
|
|
|
| |
Liabilities and Members Equity |
|
|
|
|
|
| |
|
|
|
|
|
|
| |
Current liabilities: |
|
|
|
|
|
| |
Accounts payable |
|
$ |
127 |
|
|
326 |
|
Accounts payable to related parties |
|
68 |
|
|
41 |
| |
Accrued liabilities |
|
304 |
|
|
182 |
| |
Derivative liability - current |
|
1,836 |
|
|
|
| |
Interest payable |
|
12 |
|
|
12 |
| |
Current maturities of long-term obligations |
|
3,251 |
|
|
2,922 |
| |
Total current liabilities |
|
5,598 |
|
|
3,483 |
| |
|
|
|
|
|
|
| |
Long-term debt |
|
63,456 |
|
|
65,729 |
| |
Deferred revenue, net |
|
|
|
|
49,939 |
| |
Long-term derivative liabilities |
|
2,459 |
|
|
3,358 |
| |
Asset retirement obligation |
|
262 |
|
|
5,025 |
| |
Total liabilities |
|
71,775 |
|
|
127,534 |
| |
|
|
|
|
|
|
| |
Commitments and contingencies |
|
|
|
|
|
| |
|
|
|
|
|
|
| |
Members equity |
|
98,088 |
|
|
40,809 |
| |
|
|
|
|
|
|
| |
Total liabilities and members equity |
|
$ |
169,863 |
|
|
168,343 |
|
See accompanying notes to financial statements.
LAREDO RIDGE WIND, LLC
(A Delaware Limited Liability Company)
Unaudited Statements of Operations and Comprehensive Income (Loss)
(Amounts in thousands)
|
|
(Successor) |
|
|
(Predecessor) |
|
(Successor) |
|
|
(Predecessor) |
| |||
|
|
Three months ended |
|
|
Three months ended |
|
Six months ended |
|
|
Three months ended |
|
Nine months ended |
| |
|
|
2014 |
|
|
2013 |
|
2014 |
|
|
2014 |
|
2013 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Operating Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Lease revenue |
|
$ |
1,636 |
|
|
3,327 |
|
5,835 |
|
|
4,862 |
|
11,852 |
|
Grant revenue |
|
|
|
|
730 |
|
|
|
|
731 |
|
2,192 |
| |
Total operating revenues |
|
1,636 |
|
|
4,057 |
|
5,835 |
|
|
5,593 |
|
14,044 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Operating Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Depreciation and accretion |
|
(177 |
) |
|
2,417 |
|
2,689 |
|
|
2,421 |
|
7,250 |
| |
Maintenance and other operating costs |
|
1,020 |
|
|
957 |
|
2,013 |
|
|
1,081 |
|
2,680 |
| |
General and administrative |
|
|
|
|
4 |
|
|
|
|
5 |
|
26 |
| |
Total operating expenses |
|
843 |
|
|
3,378 |
|
4,702 |
|
|
3,507 |
|
9,956 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Income from operations |
|
793 |
|
|
679 |
|
1,133 |
|
|
2,086 |
|
4,088 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Other Expense |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Interest expense |
|
(608 |
) |
|
(1,250 |
) |
(1,212 |
) |
|
(1,186 |
) |
(3,696 |
) | |
Total other expense |
|
(608 |
) |
|
(1,250 |
) |
(1,212 |
) |
|
(1,186 |
) |
(3,696 |
) | |
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Net (loss) income |
|
$ |
185 |
|
|
(571 |
) |
(79 |
) |
|
900 |
|
392 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Other Comprehensive Income (Loss): |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Unrealized (loss) gain on derivatives |
|
$ |
(1,295 |
) |
|
232 |
|
(2,473 |
) |
|
(1,682 |
) |
4,504 |
|
Other comprehensive (loss) income |
|
(1,295 |
) |
|
232 |
|
(2,473 |
) |
|
(1,682 |
) |
4,504 |
| |
Comprehensive income (loss) |
|
$ |
(1,110 |
) |
|
(339 |
) |
(2,552 |
) |
|
(782 |
) |
4,896 |
|
See accompanying notes to financial statements.
LAREDO RIDGE WIND, LLC
(A Delaware Limited Liability Company)
Unaudited Statements of Members Equity
(Amounts in thousands)
|
|
Capital |
|
Capital |
|
Retained Deficit |
|
Accumulated |
|
Total Members |
| |
|
|
|
|
|
|
|
|
|
|
|
| |
Balance at December 31, 2013 (audited) |
|
$ |
132,810 |
|
(87,697 |
) |
(946 |
) |
(3,358 |
) |
40,809 |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Net income |
|
|
|
|
|
900 |
|
|
|
900 |
| |
Capital distribution |
|
|
|
(1,700 |
) |
|
|
|
|
(1,700 |
) | |
Other comprehensive loss |
|
|
|
|
|
|
|
(1,682 |
) |
(1,682 |
) | |
|
|
|
|
|
|
|
|
|
|
|
| |
Balance at March 31, 2014 (a) |
|
$ |
132,810 |
|
(89,397 |
) |
(46 |
) |
(5,040 |
) |
38,327 |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Balance at April 1, 2014 (a) |
|
$ |
102,857 |
|
|
|
|
|
|
|
102,857 |
|
|
|
|
|
|
|
|
|
|
|
|
| |
Net income |
|
|
|
|
|
(79 |
) |
|
|
(79 |
) | |
Capital distribution |
|
|
|
(3,395 |
) |
|
|
|
|
(3,395 |
) | |
Other comprehensive loss |
|
|
|
|
|
|
|
(1,295 |
) |
(1,295 |
) | |
|
|
|
|
|
|
|
|
|
|
|
| |
Balance at September 30, 2014 |
|
$ |
102,857 |
|
(3,395 |
) |
(79 |
) |
(1,295 |
) |
98,088 |
|
(a) The differences in the equity balances at March 31, and April1, 2014 reflect the application of pushdown accounting as result of the EME Acquisition.
See accompanying notes to financial statements.
LAREDO RIDGE WIND, LLC
(A Delaware Limited Liability Company)
Unaudited Statements of Cash Flows
(Amounts in thousands)
|
|
(Successor) |
|
|
(Predecessor) |
| |||
|
|
Six months ended |
|
|
Three months ended |
|
Nine months ended |
| |
|
|
2014 |
|
|
2014 |
|
2013 |
| |
|
|
|
|
|
|
|
|
| |
Cash flows from operating activities: |
|
|
|
|
|
|
|
| |
Net (loss) income |
|
$ |
(79 |
) |
|
900 |
|
392 |
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities: |
|
|
|
|
|
|
|
| |
Depreciation, amortization, and accretion |
|
3,924 |
|
|
2,523 |
|
7,567 |
| |
Amortization of deferred revenue |
|
|
|
|
(731 |
) |
(2,192 |
) | |
Changes in derivative instruments |
|
(988 |
) |
|
|
|
|
| |
Changes in assets and liabilities |
|
|
|
|
|
|
|
| |
Accounts receivable |
|
414 |
|
|
(223 |
) |
(20 |
) | |
Inventory |
|
(38 |
) |
|
(24 |
) |
23 |
| |
Prepaid expenses and other current assets |
|
(210 |
) |
|
(252 |
) |
(155 |
) | |
Accounts payable |
|
(82 |
) |
|
(90 |
) |
(508 |
) | |
Accrued liabilities |
|
189 |
|
|
(67 |
) |
(31 |
) | |
Interest payable |
|
|
|
|
|
|
|
| |
Net cash provided by operating activities |
|
3,130 |
|
|
2,036 |
|
5,076 |
| |
|
|
|
|
|
|
|
|
| |
Cash from investing activity |
|
|
|
|
|
|
|
| |
Decrease in restricted cash |
|
|
|
|
334 |
|
|
| |
Net cash provided by investing activity |
|
|
|
|
334 |
|
|
| |
|
|
|
|
|
|
|
|
| |
Cash flows from financing activities |
|
|
|
|
|
|
|
| |
Distributions to member |
|
(4,595 |
) |
|
(1,701 |
) |
(4,033 |
) | |
Repayment of long-term debt |
|
(881 |
) |
|
(1,063 |
) |
(1,790 |
) | |
Net cash used in financing activities |
|
(5,476 |
) |
|
(2,764 |
) |
(5,823 |
) | |
|
|
|
|
|
|
|
|
| |
Net decrease in cash and cash equivalents |
|
(2,346 |
) |
|
(394 |
) |
(747 |
) | |
Cash at beginning of period |
|
2,517 |
|
|
2,911 |
|
2,735 |
| |
Cash at end of period |
|
$ |
171 |
|
|
2,517 |
|
1,988 |
|
|
|
|
|
|
|
|
|
| |
Supplemental disclosures of cash flow information: |
|
|
|
|
|
|
|
| |
Cash paid during the period for interest |
|
$ |
2,200 |
|
|
1,083 |
|
3,308 |
|
See accompanying notes to financial statements.
LAREDO RIDGE WIND, LLC
(A Delaware Limited Liability Company)
Notes to Unaudited Financial Statements
September 30, 2014
(1) Nature of Business
Laredo Ridge Wind, LLC (the Company), a Delaware limited liability company, is a wholly owned subsidiary of Mission Wind Laredo, Inc. (MWL), a wholly owned subsidiary of NRG Wind LLC (NRG Wind), a wholly owned subsidiary of NRG Energy Gas and Wind Holdings LLC, in turn a wholly owned subsidiary of NRG Energy, Inc. (NRG or Parent).
The Company, along with NRG Wind, was originally a wholly owned subsidiary of Edison Mission Energy, Inc. (EME) and was formed to construct, own, and operate a 79.9-megawatt (MW) wind powered electricity-generating system composed of 54 General Electric Company (GE) 1.5 MW generators, a power collection system, and power substation (the Windsystem) located in Boone County, Nebraska. The Company sells electricity generated by the turbines to Nebraska Public Power District (NPPD) pursuant to a power purchase agreement (PPA) with a term extending for 20 years from the commercial operation date of February 1, 2011.
The Company contracted with General Electric International, Inc. (GE) to provide certain warranty, maintenance, and repair services. The agreement, including extensions, covers a five-year period, which commenced at turbine completion in November 2010.
The following notes should be read in conjunction with the accounting policies and other disclosures as set forth in the notes to the Companys annual financial statements. Interim results are not necessarily indicative of results for a full year.
Predecessor and Successor Reporting
As further discussed in note 2, Business Acquisition, on April 1, 2014, NRG completed the acquisition of substantially all of the assets of EME, or the EME Acquisition, including its member interests in the Company. The EME Acquisition was accounted for under the acquisition method of accounting. Fair value adjustments have been pushed down to the Company, resulting in the Companys assets and liabilities being recorded at fair value at April 1, 2014. In addition, effective with the EME Acquisition, the Company adopted the accounting policies of NRG. Therefore, the Companys financial information prior to the EME Acquisition is not comparable to its financial information subsequent to the EME Acquisition.
As a result of the impact of pushdown accounting, the financial statements and certain note presentations separate the Companys presentations into two distinct periods, the period before the consummation of the EME Acquisition (labeled predecessor) and the period after that date (labeled successor), to indicate the application of different basis of accounting between the periods presented.
(2) Business Acquisition
On April 1, 2014, NRG completed the acquisition of substantially all of the assets of EME. The acquisition was recorded as a business combination under ASC 805, Business Combinations, with identifiable assets acquired and liabilities assumed recorded at their estimated fair values on the acquisition date. The impact of the acquisition method of accounting was pushed down to the Company, resulting in assets and liabilities of the Company being recorded at fair value as of April 1, 2014. The initial accounting for the business combination is not complete because the evaluation necessary to assess the fair values of certain
assets acquired is still in process. The provisional amounts are subject to revision until the evaluations are completed to the extent that additional information is obtained about the facts and circumstances that exists as of the acquisition date.
The preliminary allocation of assets and liabilities is as follows (in thousands):
|
|
Acquisition Date |
| |
|
|
Fair Value |
| |
Assets |
|
|
| |
Current and non-current assets |
|
$ |
5,046 |
|
Net plant and equipment |
|
116,000 |
| |
Power purchase agreement |
|
54,000 |
| |
Total assets acquired |
|
$ |
175,046 |
|
|
|
|
| |
Liabilities |
|
|
| |
Current and non-current liabilities |
|
4,601 |
| |
Long-term debt |
|
67,588 |
| |
Total liabilties assumed |
|
$ |
72,189 |
|
|
|
|
| |
Net assets acquired |
|
$ |
102,857 |
|
Fair Value Measurements
The fair values of the property, plant and equipment and intangible assets at the acquisition date were measured primarily based on significant inputs that are not observable in the market and thus represent a Level 3 measurement as defined in ASC 820. Significant inputs were as follows:
Property, plant and equipment The estimated fair values were determined primarily based on an income method using discounted cash flows and validated using a market approach based on recent transactions of comparable assets. The income approach was primarily relied upon as the forecasted cash flows more appropriately incorporate differences in regional markets, plant types, age, useful life, equipment condition and environmental controls of each asset. The income approach also allows for a more accurate reflection of current and expected market dynamics such as supply and demand, commodity prices and regulatory environment as of the acquisition date.
Power purchase agreement The fair value of the PPA acquired was determined utilizing a variation of the income approach where the expected future cash flows resulting from the acquired PPA was reduced by operating costs and charges for contributory assets and then discounted to present value at the weighted average cost of capital of an integrated utility peer group adjusted for project-specific financing attributes. The values were corroborated with available market data. The PPA will be amortized over a term of 17 years.
(3) Derivative Instruments and Hedging Activity
The Company has fixed for floating interest rate swaps for 90% of its outstanding term loan amount. The notional amount of the swaps was approximately $60,407,000 as of September 30, 2014. The following table summarizes the effects of the swaps on the Companys accumulated OCI balance, which reflects the change in the fair value of the swaps (amounts in thousands):
Accumulated OCI balance as of April 1, 2014 |
|
$ |
|
|
|
|
|
| |
Mark-to-market of cash flow hedge accounting contracts |
|
(1,295 |
) | |
|
|
|
| |
Accumulated OCI balance as of September 30, 2014 |
|
$ |
(1,295 |
) |
(4) Subsequent events
These financial statements and notes reflect the Companys evaluation of events occurring subsequent to the balance sheet date through January 16, 2015, the date that the financial statements are available to be issued.