"EPCOR continued its solid performance through the mid-year point, achieving strong second quarter financial results and receiving external recognition for excellence in our operations, on development projects and in our ongoing commitment to sustainability," said EPCOR President & CEO Stuart Lee. "Notably, EPCOR USA received multiple awards for operational excellence and safety from the Arizona Water Association, the Regina Wastewater Treatment Plant was cited as being one of the best executed infrastructure development projects in Canada by independent certifier BTY Group, and EPCOR was ranked among Canada's 50 Best Corporate Citizens by Corporate Knights. These accomplishments speak to the commitment our employees make to high performance across the company, in all aspects of our work."
Highlights of EPCOR's financial performance are as follows:
- Net income was $68 million and $133 million for the three and six months ended June 30, 2018, respectively, compared to net income of $56 million and $94 million for the corresponding periods in the previous year, respectively. The increase of $12 million and $39 million in net income for the three and six months ended June 30, 2018, respectively, was primarily due to higher Adjusted EBITDA, as described below, as well as, higher favorable fair value adjustments related to financial electricity purchase contracts in 2018, partially offset by lower transmission system access service charge net collections and higher finance and depreciation expense.
- Adjusted EBITDA was $178 million and $342 million for the three and six months ended June 30, 2018, respectively, compared to $135 million and $254 million for the corresponding periods in the previous year, respectively. The increase of $43 million and $88 million in Adjusted EBITDA for the 3 and 6 months ended June 30, 2018, respectively, was primarily due to the contribution from the Drainage operations which were transferred to the Company in September 2017 and higher revenues in the Water Services and U.S. Operations segments from higher customer rates and increased sales volumes.
- Investment in capital projects and acquisitions was $133 million and $234 million for the 3 and 6 months ended June 30, 2018, respectively, compared with $154 million and $252 million for the corresponding periods in the previous year, respectively. The $18 million decrease for the six months ended June 30, 2018 was primarily due to lower spending in the Distribution and Transmission segment on the Advanced Meter Infrastructure project and the Work Centre Redevelopment project, which were substantially complete in 2017 and the Hughes acquisition in 2017 with no corresponding acquisitions in 2018. This was partially offset by higher spending in the Water Services segment primarily related to the addition of the Drainage operations.
Management's discussion and analysis and the unaudited condensed consolidated interim financial statements are available on EPCOR's website and SEDAR.
EPCOR, through its wholly owned subsidiaries, builds, owns and operates electrical, natural gas and water transmission and distribution networks, water and wastewater treatment facilities and sanitary and stormwater systems, and infrastructure in Canada and the United States. The Company also provides electricity, natural gas and water products and services to residential and commercial customers. EPCOR, headquartered in Edmonton, is an Alberta Top 70 employer.
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