EX-99.4 5 y48878ex99-4.txt PRESS RELEASE 1 [GREAT LAKES POWER INC. LOGO] NEWS RELEASE GREAT LAKES ANNOUNCES NET INCOME OF $116 MILLION FOR TWELVE MONTHS ENDED DECEMBER 31, 2000 TORONTO, FEBRUARY 2, 2001 - Great Lakes Power Inc. today announced net income for the year ended December 31, 2000 of $116 million or $0.92 per fully diluted common share, compared to $113 million or $0.90 per share in 1999. Power generation for 2000 increased to 4,581 gigawatt hours ("GWh"), up 27% from 3,604 GWh last year mainly as a result of the acquisition of the Maclaren Energy hydroelectric system in western Quebec in late 1999. Great Lakes' Chairman and Chief Executive Officer, Ed Kress, commented as follows: "The additional contribution from our power operations in Ontario and Quebec was substantially offset by the impact of abnormally dry conditions in the US Midwest on our power operations in Louisiana. The company's recently announced $500 million capital investment program is moving ahead well, with construction on the High Falls power station in northern Ontario expected to start in the first half of 2001." RESULTS FOR 2000 The company's northern Ontario power generating, transmission and distribution system sold 2,309 GWh of electricity during 2000, down from 2,341 GWh in 1999. Internal power generation decreased to 1,369 GWh from 1,503 GWh in the preceding year, with lower precipitation throughout 2000. The company's ongoing facilities upgrading program continued with the returbining of three generating units at the Andrews, MacKay and Hogg power stations, which added 7 megawatts ("MW") of capacity. The Maclaren Energy system, operated through 50%-owned Great Lakes Hydro Income Fund, generated 1,554 GWh of power during the year, 10% higher than plan. The strategic power interconnection at Masson, Quebec, which links the Quebec and Ontario power grids, was recently upgraded and expanded by 240 MW to 400 MW. The company's other operations in Canada and the United States generated 1,658 GWh of power during 2000, down from 1,909 GWh in 1999. Higher precipitation in Quebec increased Pontiac Power's generation from 205 GWh to 217 GWh. The Lake Superior Power cogeneration plant in Ontario also increased its production to 852 GWh from 843 GWh, including the energy equivalents of contracted natural gas resold to take advantage of higher prices. Louisiana HydroElectric Power's generation declined substantially from 810 GWh in 1999 to 538 GWh in 2000, as a result of significantly lower water flows on the Mississippi River. The financial impact of this lower generation was partly offset by drawing down hydrological reserves previously set aside for this purpose. 2 -2- CAPITAL INVESTMENT PROGRAM Work continues on Great Lakes' $500 million capital investment plan, which forms an integral part of a strategic plan to double power operating earnings by the year 2005. High Falls, Construction is expected to begin in May on the 45 MW, $75 million Ontario redevelopment of the High Falls hydroelectric generating station on the Michipicoten River in northern Ontario, for expected completion in fourth quarter of 2002. Sault Ste. Marie, Planning continues for the construction of a $25 million high voltage 230 Ontario / Michigan kilovolt transmission interconnection to link the company's generating stations in Ontario with the neighbouring power grid in Michigan. This interconnection will have a capacity of 300 MW and will enhance Great Lakes' ability to access other energy markets to maximize the value of its power system. Powell River, The Great Lakes Hydro Income Fund has acquired a 50% economic interest in British Columbia two hydroelectric generating stations in the city of Powell River, B.C. which have an aggregate capacity of 82 MW, at a cost of $113 million. Pingston Creek, Site development has commenced for a 30 MW, $45 million hydroelectric British Columbia generating station near Revelstoke, B.C. in partnership with Canadian Hydro Developers Inc. Construction is expected to start during the first half of 2001 after negotiating power sales and transmission agreements, for completion in mid 2002. Passo do Meio, Pre-development work continues for five new hydroelectric generating Rio Grande do Sul, stations in southern Brazil, which have a total capacity of 81 MW Brazil representing an investment of approximately $80 million. Site development work has started on the first of these projects, the 30 MW Passo do Meio generating station in the State of Rio Grande do Sul.
3 -3- CORPORATE As previously announced, a Special Meeting of Great Lakes' shareholders will be held on Wednesday, February 28, 2001 to consider the proposal to amalgamate the company with a wholly-owned subsidiary of Brascan Corporation, as part of a going private transaction. The board of directors has recommended approval of this proposal. If this amalgamation is approved, the affairs of the company will be continued by the successor company, under the name Great Lakes Power Inc. OUTLOOK Although abnormally dry conditions continue to prevail in the US Midwest, the financial impact of these conditions is expected to be partly offset by increased contributions from other power operations and by the impact of the company's ongoing facilities upgrading program. Through its capital investment plan, the company is aggressively seeking to increase returns as new development projects and acquisitions are brought on stream. * * * * * * * * * * Note: This news release contains forward-looking statements concerning the company's business and operations. The company cautions that, by their nature, forward-looking statements involve risk and uncertainty and the company's actual results could differ materially from those expressed or implied in such statements. Reference should be made to the company's most recent Annual Information Form for a description of the major risk factors. * * * * * * * * * * Great Lakes Power Inc. generates, transmits and distributes electricity in northern Ontario and western Quebec, and has ownership and operating interests in other power generating facilities in Canada and the United States. - 30 - For more information, please contact: MEDIA: INVESTORS AND FINANCIAL ANALYSTS: Edward C. Kress Richard Legault Chairman and Vice-President and Chief Executive Officer Chief Financial Officer (416) 363-9491 (416) 956-5138 4 - 4 - [GREAT LAKES POWER INC. LOGO] FINANCIAL HIGHLIGHTS
-------------------------------------------------------------------------------- THREE MONTHS ENDED YEAR ENDED DECEMBER 31 DECEMBER 31 millions, except per share amounts 2000 1999 2000 1999 -------------------------------------------------------------------------------- REVENUES $ 92 $ 66 $ 334 $ 286 NET INCOME $ 24 $ 21 $ 116 $ 113 PER FULLY DILUTED COMMON SHARE $0.19 $0.17 $0.92 $0.90 DIVIDENDS PER COMMON SHARE $0.16 $0.16 $0.64 $0.64 --------------------------------------------------------------------------------
OPERATING STATISTICS
-------------------------------------------------------------------------------- THREE MONTHS ENDED YEAR ENDED DECEMBER 31 DECEMBER 31 Gigawatt hours 2000 1999 2000 1999 -------------------------------------------------------------------------------- NORTHERN ONTARIO POWER Electricity generation 306 294 1,369 1,503 Electricity sales 591 590 2,309 2,341 Internal generation (1) 48% 48% 57% 62% MACLAREN ENERGY (2) Electricity generation 325 191 1,554 192 Electricity sales 323 193 1,573 193 VALERIE FALLS POWER Electricity generation and sales 12 15 51 51 PONTIAC POWER Electricity generation 45 58 217 205 Electricity sales 45 56 214 202 LOUISIANA HYDROELECTRIC POWER Electricity generation 72 69 538 810 Electricity sales 68 66 520 780 LAKE SUPERIOR POWER (3) Electricity generation and sales 220 220 852 843 -------------------------------------------------------------------------------- TOTAL ELECTRICITY GENERATION 980 847 4,581 3,604 ELECTRICITY SALES 1,259 1,140 5,519 4,410 --------------------------------------------------------------------------------
(1) Electricity generation as a percentage of electricity available for sale before distribution and line loss. (2) Acquired in November 1999 through the Great Lakes Hydro Income Fund. (3) Including energy equivalents of contracted gas sales. 5 - 5 - [GREAT LAKES POWER INC. LOGO] CONSOLIDATED FINANCIAL STATEMENTS(1) CONSOLIDATED STATEMENT OF INCOME --------------------------------------------------------------------------------
THREE MONTHS ENDED YEAR ENDED DECEMBER 31 DECEMBER 31 millions, except per share amounts 2000 1999 2000 1999 -------------------------------------------------------------------------------- REVENUE Power operations $ 63.0 $ 40.0 $ 226.8 $ 187.7 Long-term investments 11.5 13.1 48.0 47.4 Investment income 17.0 12.8 58.7 51.2 ------------------------------------------- 91.5 65.9 333.5 286.3 ------------------------------------------- EXPENSE Interest 20.8 16.9 79.2 64.4 Power and fuel purchases 26.5 17.7 69.8 54.1 Operating costs 7.6 6.1 26.8 19.2 Depreciation 5.3 4.2 20.7 16.7 Minority interests 1.5 0.9 4.6 3.7 Income and other taxes 5.9 (0.6) 16.9 15.1 ------------------------------------------- 67.6 45.2 218.0 173.2 -------------------------------------------------------------------------------- NET INCOME $ 23.9 $ 20.7 $ 115.5 $ 113.1 -------------------------------------------------------------------------------- PER FULLY DILUTED COMMON SHARE $ 0.19 $ 0.17 $ 0.92 $ 0.90 --------------------------------------------------------------------------------
CONSOLIDATED STATEMENT OF CASH FLOWS --------------------------------------------------------------------------------
YEAR ENDED DECEMBER 31 millions 2000 1999 -------------------------------------------------------------------------------- CASH PROVIDED FROM OPERATIONS $ 125.5 $ 131.5 -------------------------------------------------------------------------------- FINANCING AND SHAREHOLDER DISTRIBUTIONS Borrowings -- 290.0 Debt repayments (6.9) (187.5) Convertible debenture interest (17.6) (15.9) Common share dividends (64.9) (64.9) -------------------------------------------------------------------------------- (89.4) 21.7 -------------------------------------------------------------------------------- INVESTING Securities (8.7) (1.9) Loans and other receivables 14.9 (37.1) Property, plant and equipment (52.7) (139.0) Other 10.9 17.1 -------------------------------------------------------------------------------- (35.6) (160.9) -------------------------------------------------------------------------------- CASH AND CASH EQUIVALENTS Increase (Decrease) 0.5 (7.7) Balance, beginning of year 6.2 13.9 -------------------------------------------------------------------------------- BALANCE, END OF YEAR $ 6.7 $ 6.2 --------------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEET --------------------------------------------------------------------------------
DECEMBER 31 December 31 millions 2000 1999 -------------------------------------------------------------------------------- ASSETS Securities $ 661.3 $ 646.1 Loans and other receivables 322.0 325.1 Long-term investments 536.2 534.9 Property, plant and equipment 956.8 899.1 -------------------------------------------------------------------------------- $ 2,476.3 $ 2,405.2 -------------------------------------------------------------------------------- LIABILITIES Accounts payable and other $ 76.4 $ 99.4 Mortgage bonds 393.5 346.2 Term debentures 558.8 543.8 FUTURE INCOME TAX LIABILITY 104.4 106.7 MINORITY INTERESTS 94.2 93.1 SHAREHOLDERS' EQUITY (2) 1,249.0 1,216.0 -------------------------------------------------------------------------------- $ 2,476.3 $ 2,405.2 --------------------------------------------------------------------------------
NOTES: (1) These financial statements should be read in conjunction with the Notes to the company's audited Consolidated Financial Statements for the years ended December 31, 2000 and 1999. (2) SHAREHOLDERS' EQUITY
-------------------------------------------------------------------------------- DECEMBER 31 December 31 millions 2000 1999 -------------------------------------------------------------------------------- Common shares (101,393,934) $ 603.5 $ 603.5 Retained earnings 397.8 364.8 -------------------------------------------------------------------------------- 1,001.3 968.3 Subordinated convertible debentures 247.7 247.7 -------------------------------------------------------------------------------- $1,249.0 $1,216.0 --------------------------------------------------------------------------------
The subordinated convertible debentures are convertible at $10.00 per common share into 24.8 million common shares.