TerraForm investment impacts Q1 performance of Brazil's Renova
Wind farm in Rio Grande do Sul. Author: Alexandre Pereira. License: Creative Commons, Attribution-ShareAlike 2.0 Generic
Brazilian renewables company Renova Energia SA (BVMF:RNEW11) saw its first-quarter (Q1) net loss expand to BRL 552 million (USD 159m/EUR 140m) from BRL 29.1 million in January-March 2015.
The huge deficit is largely attributed to a BRL-382.9-million loss on investment in connection with Renova's shareholding in TerraForm Global (NASDAQ:GLBL), one of SunEdison’s (OTCMKTS:SUNEQ) two yieldcos.
When announcing the termination of a hydro assets purchase contract last month, Renova mentioned it planned to exercise an option to sell 7 million TerraForm Global shares. It acquired its stake in the yieldco a year ago through a securities swap agreement. The agreed price per share was equal to the one paid in TerraForm Global's initial public offering (IPO).
On an adjusted basis, the Brazilian company recorded a loss before interest, tax, depreciation and amortisation of BRL 36.6 million versus a positive EBITDA of BRL 61 million a year back. Net operating revenue decreased by 6.8% to BRL 96.1 million.