Innergex Renewable Energy Inc Q4 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Nick Boychuk - Cormark Securities Inc - Analyst : Thanks. Good morning, guys. Yeah spend a second on the organic growth trajectory and how you're thinking about the risks geopolitically, but also with resource allocation, people, capital. It seems that the opportunity you have in Canada is phenomenal magnitude 560 megawatts in BC versus 13 megawatts in France. How are you thinking about allocating capital and time between these markets, and would it not make more sense to really just retrench in Canada and focus on all of those opportunities there?

Question: Nick Boychuk - Cormark Securities Inc - Analyst : Okay, that's good and it makes sense, but if we're thinking of the expertise that you have and Michelle, you mentioned the phenomenal relationships you have with First Nations partners, is it fair to assume that the returns on the capital deployed in Canada would exceed what you'd be seeing in France, the US, or Chile?

Question: Nick Boychuk - Cormark Securities Inc - Analyst : Okay, thanks. And then last for me just on the balance sheet, can you comment quickly on the corporate lending facility you have, the limit that you're comfortable taking that up to, I believe the limit is $950 million but you've got the convertible debenture that's coming due this spring. How comfortable are you taking that higher?

Question: Nick Boychuk - Cormark Securities Inc - Analyst : Understood thank you gentlemen.

Question: Nelson Ng - RBC Capital Markets - Analyst : Great thank you and congrats on a pretty good year. So, my first question relates to the 5 projects under construction. Roughly what's the total CapEx, you expect for those five projects? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 20, 2025 / 2:00PM, INE.TO - Q4 2024 Innergex Renewable Energy Inc Earnings Call

Question: Nelson Ng - RBC Capital Markets - Analyst : Okay, got it. And then next question just relates to US tariffs, and I think you have MU winds that will start construction pretty so MU2 wind. So are like are the turbines manufactured in Canada or the US? Like do you have to move, like, do you have to buy a lot of equipment from the US and then the other thing is like with the weak Canadian dollar, are a lot of items priced in US dollars from a CapEx perspective?

Question: Nelson Ng - RBC Capital Markets - Analyst : Great, thanks, Michelle. And then just one more question, in terms of your target for 2025, you mentioned that you're also looking to, did you say, like, so last year you were, you mentioned that you would bid over 500 megawatts and win over 400 megawatts and obviously you've achieved that for 2025. Is your target to also bid over 500 megawatts?

Question: Nelson Ng - RBC Capital Markets - Analyst : Got it. Okay, I'll get back in the queue. Thank you.

Question: Rupert Merer - National Bank Financial - Analyst : Hi, good morning. First question, I'd like to follow up on Palominos. You put a lot of thought to tariffs and potential changes to tax credits. So you've highlighted that you've invested in panels already. How much have you invested in those panels and is the assumption then also that you have a safe harbor on tax credits?

Question: Rupert Merer - National Bank Financial - Analyst : And that includes the value of all of the equipment you've invested in so far?

Question: Rupert Merer - National Bank Financial - Analyst : Okay, great. And then secondly, so the share price, I mean, arguably lowest we've seen. Or Interject so you've talked about being able to self finance with sell downs in the future if you need to, but I'm just wondering you can talk us through some of the other strategic. Plans you may have to deal with the low share price, and are you looking to allocate more capital for share buybacks perhaps or look to do more sell downs maybe for share buybacks or other investments? How is the share price impacted you're thinking?

Question: Rupert Merer - National Bank Financial - Analyst : How do you view your cost of capital today versus some of your competitors, maybe some of your private equity competitors? You've been very successful in RFPs so far, but do you feel the need to generate higher returns than some of your competitors going forward if this dislocation remains? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 20, 2025 / 2:00PM, INE.TO - Q4 2024 Innergex Renewable Energy Inc Earnings Call

Question: Rupert Merer - National Bank Financial - Analyst : Great, I'll leave it there. Thank you.

Question: Mark Jarvi - CIBC Capital Markets - Analyst : Hi everyone, obviously things are building a lot of momentum here in Canada and you're obviously positive on the US market. Can you refresh this again on what you think are realistic opportunities in terms of development objectives? I think last year around this time you said 1.5 gigawatts by 2030. You're getting pretty close to that. So how do you think about that number now? How do you think about what else you want to add in terms of your ability to continue to do that on a self-funding basis?

Question: Mark Jarvi - CIBC Capital Markets - Analyst : So where would you say you'd stand now in terms of where you are in terms of the size of development in terms of what you can sell fund today and like then how close are you then to potentially having to ramp up minority sell downs or asset sales to cover off incremental growth from here onboard?

Question: Mark Jarvi - CIBC Capital Markets - Analyst : And then another question is for me is Curtis Palmer is near the end of that contract. What's the expectations there? Is the view to maximize the TPA price, or would you be looking to try to lock in a long term contract 10, 20 years and put some debt on that as a source of non-delusive funding? Sort of what's the sort of optimization path for Curtis Palmer?

Question: Mark Jarvi - CIBC Capital Markets - Analyst : I'm just curious too if you can comment on whether or not you sort of have the same vision between yourselves and your partner Hydro-QuTbec back in terms of how to optimize that asset and for some reason if there was a difference of opinions, would that be something you'd be consider as a as a non-core asset to sell off your share of that facility?

Question: Mark Jarvi - CIBC Capital Markets - Analyst : Understood. Alright, thanks for your time, Jean. Great update.

Question: Ben Pham - BMO Capital Markets - Analyst : Good morning, hey, good morning. I just want to check on some of the self funding. Calculations and just how it compared to last year you're framing it as $300 million CapEx and 150 megawatts net and I just wanted to square that language with today's language, which I'm not saying it's new, but maybe just an update 400 megs. I'm assuming that's like a gross number, and do you have higher free cash on now with plausible springs in that calculus?

Question: Ben Pham - BMO Capital Markets - Analyst : Yeah, how does the math compare now to last year because you mentioned you're generating free cash with $75 million you lever it that can self fund $300 million CapEx, which is more like 150 megawatts. Is that did some of the assumptions change or maybe I've missed the trail there.

Question: Ben Pham - BMO Capital Markets - Analyst : Okay, maybe related to that. So I was just looking at your backlog, post 2027. Looks like every year there's at least 200 megawatts of projects each year, which looks pretty good. Are you trying to sell more of that white space there to 400 megawatts that ultimate that the grand plan like each year of 400 megs? And just kind of logistically (inaudible)

Question: Ben Pham - BMO Capital Markets - Analyst : Oh yeah, no, absolutely, I'm just looking at your 2027 plus backlog on slide 9. And each year you have at least 200 megawatts of projects already, maybe not secured, but it looks like it's coming in each year. What is your plan then the grand plan is, are you trying to have each year 400 megs and sell it each year is that the plan?

Question: Ben Pham - BMO Capital Markets - Analyst : Would you characterize the sequence of the megawatts coming on post 2027? Does it seem like it's almost Probably one of the best situations you've seen for a long time. On a [girl] front?

Question: Ben Pham - BMO Capital Markets - Analyst : Okay, thank you very much. Unidentified_2 Thank you. You're welcome.