Brookfield Renewable Energy Partners LP (NYSE:BEP) Q4 2018 Earnings Conference Call Transcript

Feb 08, 2019 • 09:00 am ET


Brookfield Renewable Energy Partners LP (NYSE:BEP) Q4 2018 Earnings Conference Call Transcript


Loading Event

Loading Transcript


Good day, ladies and gentlemen, and welcome to Brookfield Renewable Partners' Fourth Quarter and Year-End 2018 results Conference Call Webcast. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. (Operator Instructions) As a remainder this conference is being recorded.

I would now like to introduce your host for today's conference, Chief Executive Officer, Sachin Shah, you may begin.

Sachin Shah

Thank you, operator. Good morning everyone and thank you for joining us for our fourth quarter 2018 Conference call.

Before we begin, I'd like to remind you that a copy of our news release, investor supplement and letter to unitholders can be found on our website. I also want to remind you that we may make forward-looking statements on this call. These statements are subject to known and unknown risks, and our future results may differ materially. For more information, you're encouraged to review our regulatory filings available on SEDAR, EDGAR and on our website.

2018 was another strong year for the business, as we continue to execute on our operating, funding and growth initiatives. We invested considerable time during the year enhancing our operational and investment capabilities around the world. We also raised significant amounts of capital to ensure we are well positioned to invest on a value basis during this next cycle. Since our inception in 1999, we have delivered, 15% per unit compounded annual return to unitholders and we remained focused on delivering long-term stable returns as we build the business.

I've note in 2018, our FFO increased 14% on a per unit basis over the prior year as all of our businesses has performed in line with expectations. Key operating priorities included cost reduction initiatives in North America and Colombia, which should improve our margins by approximately $20 million annually in the future. We continue to build out our operating teams in the U.S., Europe, India and China over the year and continue to support our longer term plans in these markets. From a growth perspective, we Commissioned approximately 60 megawatts of new wind and hydro development, advanced over 350 megawatts of development in our pipeline and maintain our opportunistic approach to development which minimizes funding obligations and ongoing costs. We invested $550 million into growth during the year, including acquisitions and share buybacks. Accordingly, we repurchased approximately $2 million -- units, primarily in the fourth quarter at $27 per share.

Our balance sheet and funding capabilities are strong. We executed on our asset recycling strategy selling a partial interest in mature assets and exiting non-core markets. We extended all near-term debt maturities. During the year, increasing the average duration of our debt to 10 years. We now have no material debt maturities until 2023. We also maintained our investment grade balance sheet, increased available liquidity to -- which should exceed $2.2 billion once previously disclosed asset sales are closed. And finally, we continue to improve our distribution payout ratio, which ended the year