Macquarie Power & Infrastructure Income Fund Announces First Quarter 2006 ResultsTORONTO, May 10, 2006 –
Macquarie Power & Infrastructure Income Fund (TSX:
MPT.UN – “MPT”, the “Fund”) today announced results for the first quarter ended March 31,
The Fund generated revenue for the quarter of $27.7 million, a 9.7% increase on revenue in
the previous corresponding quarter of $25.2 million. Income from operations1 was $4.4 million
for the quarter, compared to $5.5 million for the previous corresponding quarter.
The Fund’s distributable cash2 for the quarter was $10.8 million ($0.359 per fully diluted unit),
compared to the previous corresponding quarter of $7.7 million ($0.364 per fully diluted unit).
Declared distributions to unitholders for the quarter were $7.5 million ($0.250 per unit),
representing a payout ratio of 70% (Q1 2005 – 65%).
The increase in the Fund’s distributable cash for the quarter reflected distributions of
$2.6 million from Leisureworld as well as the continuing impact of electricity rate increases
under Cardinal’s Power Purchase Agreement with Ontario Electricity Financial Corporation
and decreased fuel transportation costs for the quarter. In addition, Cardinal received a
payment of $1.1 million during the quarter for an adjustment in the 2005 Direct Customer Rate.
The improvement in the Fund’s distributable cash for the quarter was partially offset by the
Fund’s decision to accrue Fund administration expenses on a quarterly basis to better align
revenues and costs going forward. Previously these costs were primarily recorded in the
As at March 31, 2006, the Fund had cash and cash equivalents totalling $21.0 million, of which
$7.5 million was allocated to its general, major maintenance and capital expenditure reserve
accounts. The balance of this amount is maintained as free cash on hand and is available to
finance the seasonality of operations.
Mr. Gregory Smith, Chief Executive Officer of the Fund, said, “The Fund has performed well in
the first quarter of 2006, with growing cash flows and strong operating performances
generated from the underlying Cardinal and Leisureworld businesses.
1 Income from operations is net income less unrealized gains or losses, interest and equity accounted income or loss.
2 Distributable cash is cash flows from operating activities after removing changes in working capital and reflecting the
impacts of releases from maintenance reserves, allocations to major maintenance and capital expenditure reserves
and distributions from Leisureworld.
“With Cardinal’s major maintenance program tracking to timetable and costs fully funded by
the major maintenance reserve, we remain positive about the Fund’s outlook and our ability to
maintain a payout ratio of less than 95% for 2006,” Mr. Smith said.
MPT anticipates that in excess of 75% of distributions for 2006 will reflect a return of capital,
based on current operations and barring any significant external shocks.
Cardinal Operational Performance
During the quarter the Cardinal plant performed well with availability of 100% (Q1 2005 –
99.2%), capacity of 97.5% (Q1 2005 – 97.9%) and electricity sales of 343 MWh (Q1 2005 –
345 MWh). The plant did not curtail any electricity production in the quarter (Q1 2005 – 88
Leisureworld Operational Performance
Through its 45% indirect interest in Leisureworld Senior Care LP (“LSCLP”), the Fund owns a
45% interest in Leisureworld which it accounts for as an equity investment.
During the quarter, Leisureworld continued to operate in line with expectations. Resident
uptake of preferred accommodation increased, with Leisureworld receiving the preferred
payment rate for 77% of its designated preferred beds at March 31, 2006. Long-term care
(LTC) facilities opened in 2003 and 2004 (Brampton Meadows, Brampton Woods, Norfinch
and Vaughn) improved occupancy levels during the quarter, driving increases in revenue and
income from operations. The Brampton Meadows LTC home also surpassed the 97%
threshold rate during the quarter – only one LTC home now remains in the “ramp up” phase
and is expected to achieve 97% occupancy by the fourth quarter 2006. Overall, average LTC
occupancy for the quarter was 95% (Q1 2005 – 86%).
Conference Call and Webcast
The Fund will hold a conference call to discuss the first quarter results on Thursday, May 11,
2006 at 8:30AM. The conference call will be available via webcast through the Fund’s website
at www.macquarie.com/mpt and by telephone at 416-695-6623 (local) or 1-888-333-4519 (toll
free). A replay of the conference call will be available until May 18, 2006 and can be accessed
by dialling 416-695-5275 (local) or 1-888-509-0081 (toll free), pass code 619580.
About the Fund
Macquarie Power & Infrastructure Income Fund invests in infrastructure assets with an
emphasis on power infrastructure. MPT’s strategy is to acquire and actively manage a highquality
portfolio of long-life infrastructure assets to improve their financial performance and
provide growing and sustainable distributions to unitholders for the long term. MPT’s
infrastructure portfolio includes Cardinal, a 156MW gas-fired cogeneration power station in
Ontario, and a 45% interest in Leisureworld, a leading long-term care provider in Ontario with
over 30 years operating experience. MPT is managed by a wholly-owned subsidiary of
Macquarie Bank Limited and a member of the Macquarie group.
Certain statements in this news release may constitute forward-looking statements which
involve known and unknown risks, uncertainties and other factors which may cause the actual
results to be materially different from any future results expressed or implied by such forwardlooking
statements. Forward-looking statements use such words as “may”, “will”, “anticipate”,
“believe”, “expect”, “plan” and other similar terminology. These statements reflect current
expectations regarding future events and operating performance and speak only as of the date
of this news release. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be
accurate indications of whether or not such results will be achieved. A number of factors could
cause actual results to differ materially from the results discussed in the forward-looking
statements, including, but not limited to, risks associated with the Cardinal facility and the
power industry, risks associated with MPT’s interest in Leisureworld and the long-term care
sector, and risks associated with the structure of MPT. The risks and uncertainties described
above are not exhaustive and other events and risk factors including risk factors disclosed in
MPT’s filings with Canadian securities regulatory authorities could cause actual results to differ
materially from the results discussed in the forward-looking statements.
The forward-looking statements contained in this news release are based upon information
currently available and what the Manager currently believes are reasonable assumptions,
however neither the Fund nor the Manager can assure investors that actual results will be
consistent with these forward-looking statements. These forward-looking statements are
made as of the date of this news release, and the Fund and the Manager assume no
obligation to update or revise them to reflect new events or circumstances. The Fund and the
Manager caution readers not to place undue reliance on any forward-looking statements,
which speak only as of the date made.
Non-GAAP Financial Measures
"Income from operations" and "distributable cash" do not have any standardized meaning
under Canadian Generally Accepted Accounting Principles (GAAP). Management believes
they are useful measures of performance as they provide investors with indications of income
from operations and the amount of cash available for distribution to unitholders. The Fund's
method of calculating "income from operations" and "distributable cash" may not be
comparable to other similarly named calculations.
For further information, please contact:
Chief Financial Officer
Macquarie Power Management Ltd.
Tel: (416) 607 5198
Public Affairs and Communications
Macquarie North America Ltd.
Tel: (416) 607 5042
Macquarie Power & Infrastructure Income Fund is not an authorised deposit taking institution for the purposes of the Banking Act (Cth) 1959 and Macquarie Power & Infrastructure Income Fund’s obligations do not represent deposits or other liabilities of Macquarie Bank Limited ABN 46 008 583 542. Macquarie Bank Limited does not guarantee or otherwise provide assurance in respect of the obligations of Macquarie Power & Infrastructure Income Fund.