An Ontario-based utility company is getting out of the renewables business after it lost more than $250 million in Q2, the company said this week. The company's board chairman, Kenneth Moore, said that the company will now focus on being a pure-play utility company.
Algonquin Power and Utilities Corp reported earnings losses attributable to shareholders of $253.2 million in Q2, after sustaining a $33.4 million loss in the same quarter last year. The Q2 loss was larger than its total loss through the full year 2022.
The company reported that the second quarter losses were due mostly to weather conditions that tanked customer demand, prompting the company to produce less wind power.
"We have two strong businesses – a well-positioned regulated utility business with diversified assets and attractive jurisdictions, and a solid, competitive renewables business with scale and strong assets. That said, we believe the value of our assets is not fully realized in our current structure. We therefore determined that focusing on our regulated business going forward and pursuing a sale of the renewables business is the best path forward for AQN," Algonquin said in a press release, adding that the company was" confident that the intended sale will unlock AQN's value as a pure-play regulated utility by simplifying our structure and enabling us to focus on lower risk regulated investment opportunities, with greater operational efficiency and capital discipline."
Algonquin's Q2 revenue increased in Q2 2023 from Q2 2022, to $627.9 million. Adjusted net earnings, however, fell by 50% to just 8 cents per share.
Algonquin's website still touts its Net-Zero 2050 goals, which states in part that the achievement of that target is supported in part by, "the deep expertise in renewables development."
Algonquin Power & Utilities Corp., the parent company of Liberty, is a diversified international generation, transmission, and distribution utility with over $17 billion of total assets, according to the company's website.
By Julianne Geiger for Oilprice.com
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