NRG Yield Q2 Profit Increases - Quick Facts

(RTTNews) - NRG Yield, Inc. (NYLD, NYLD.A) reported that its net income attributable to Class A and Class C stockholders for the second-quarter ended June 30, 2015 was $10 million and $0.15 per Class A and Class C common share, compared to $6 million and $0.13 per Class A and Class C common share last year.

Net Income, Excluding Pre-acquisition Net Income of Drop Down Assets, rose to $41 milloion from $25 million last year.

Total operating revenues for the quarter rose to $217 million from last year's $173 million adjusted.

Analysts polled by Thomson Reuters expected the company to report earnings of $0.20 per share and revenues of $231.73 million for the quarter. Analysts' estimates typically exclude special items.

On June 29, 2015, NRG Yield acquired a 25 percent interest in the Desert Sunlight Solar Farm in Riverside, CA from GE for $285 million, subject to working capital adjustments, plus the assumption of $287 million of non-recourse project level debt.

The acquisition, which results in an increase of 137.5 MW of operating solar capacity owned by NRG Yield, places the Company into a partnership with subsidiaries of NextEra Energy and Sumitomo Financial, who are the 50 percent and 25 percent owners of Desert Sunlight, respectively. The transaction is expected to contribute Adjusted EBITDA of $45 million and CAFD of $22 million on an annual run rate basis.

The Company announced the declaration of a quarterly dividend on Class A and Class C common stock of $0.21 per share ($0.84 per share annualized) payable on September 15, 2015 to shareholders of record as of September 1, 2015. This equates to a 5% increase over the prior quarter and a 15% increase year over year.

For third quarter 2015, the Company expects Adjusted EBITDA of $195 million and CAFD of $110 million, although actual results may vary depending on the operating performance of the assets.

Due to the continued unusually low wind production across the fleet, the Company has revised its expectations for wind production over the balance of 2015. As a result of these reduced expectations, combined with a lower expected pace of deployments of residential solar leases from NRG, NRG Yield is updating full year guidance for Adjusted EBITDA to $660 million and CAFD to $160 million. The Company does not expect the reduction in 2015 Adjusted EBITDA and CAFD guidance to have any impact on either its current dividend or expected long-term dividend growth.

Without any effect to future acquisitions or drop downs, the Company expects the current portfolio to generate $760 million of Adjusted EBITDA and $245 million of CAFD on an annual run rate basis. Based on these updated annual run-rate projections, the Company also targets a quarterly dividend of $0.25 per share ($1.00 per share annualized) on each of the Company's Class A and Class C common stock by the 4th quarter of 2016. This represents a 19% increase over the current annualized dividend rate and 67% increase since NRG Yield's first dividend in the fourth quarter of 2013.