Earnings call transcript: Northland Power Q1 2025 misses EPS forecast

Northland Power Inc. reported its Q1 2025 earnings with an EPS of $0.25, falling short of the forecasted $0.5882. The company also reported revenue of $648.52 million, below the anticipated $704.04 million. Following the announcement, Northland Power’s stock price saw a modest increase of 1.37% in after-hours trading, closing at $19.74.

Key Takeaways

• Northland Power’s Q1 2025 EPS and revenue missed analyst expectations.
• Stock price increased by 1.37% despite the earnings miss.
• The company completed Canada’s largest battery storage project ahead of schedule.
• Offshore wind projects in Taiwan and Poland are progressing as planned.
• Maintained financial guidance despite lower-than-expected offshore wind resources.

Company Performance

Northland Power’s performance in Q1 2025 was marked by a 20% decrease in adjusted EBITDA compared to Q1 2024, totaling $361 million. The company also reported a 30% decline in free cash flow to $157 million. Despite these declines, Northland Power continues to maintain a strong liquidity position with $1.1 billion available, supporting its diversified portfolio across renewable energy sectors. The company boasts an impressive dividend track record, having maintained payments for 28 consecutive years, with a current yield of 6.08%. InvestingPro analysis reveals 5 additional key insights about Northland’s financial strength and market position, available to subscribers.

Financial Highlights

• Revenue: $648.52 million, down from the forecasted $704.04 million.
• Earnings per share: $0.25, missing the forecast of $0.5882.
• Adjusted EBITDA: $361 million, a 20% decrease from Q1 2024.
• Free cash flow: $157 million, 30% lower than Q1 2024.

Earnings vs. Forecast

Northland Power’s actual EPS of $0.25 was significantly below the forecast of $0.5882, representing a negative surprise. The revenue also fell short of expectations by approximately $55.52 million. This underperformance relative to forecasts could indicate challenges in meeting market expectations, although the stock price increase suggests investor confidence in the company’s long-term strategy.

Market Reaction

Despite the earnings miss, Northland Power’s stock rose by 1.37% to $19.74 in after-hours trading. This movement may reflect investor optimism about the company’s strategic initiatives and ongoing projects. Analyst consensus gathered by InvestingPro shows strong confidence in the company’s future, with price targets ranging from $14.72 to $21.54. The stock has demonstrated resilience with a 12.7% year-to-date return, outperforming many peers in the renewable energy sector. For detailed analysis of Northland Power’s market position and growth potential, investors can access the comprehensive Pro Research Report, part of the extensive coverage available for 1,400+ top stocks on InvestingPro.

Outlook & Guidance

Northland Power maintains its financial guidance for the year, focusing on geographic and technological diversification. The company is exploring new opportunities in natural gas power generation and plans to provide more detailed growth strategies at its upcoming Investor Day.

Executive Commentary

Christine Healy, CEO, emphasized the growing global demand for renewable energy and natural gas, stating, "We see that globally the demand for energy is growing, and the demand for renewables and natural gas is strong." CFO Jeff Hart highlighted the company’s robust liquidity position, noting, "We have $1.1 million of available corporate liquidity and have multiple funding tools to deliver on a disciplined growth strategy."

Risks and Challenges

• Offshore wind resource variability could impact future earnings.
• Supply chain challenges may affect project timelines.
• Market saturation in renewable energy could limit growth opportunities.
• Macroeconomic pressures might influence funding and project costs.

Q&A

During the earnings call, analysts inquired about the economics of the Oneida project and the steady progression of supply chains for the Hai Long and Baltic Power projects. Executives reassured that growth opportunities are being evaluated and that recent US tariffs have had minimal impact on operations.

Full transcript - Northland Power Inc. (NPI) Q1 2025:

Conference Operator: Welcome to the Northland Power Conference Call to discuss the First Quarter twenty twenty five Results. As a reminder, this conference is being recorded on Wednesday, 05/14/2025 at ten a. M. Eastern. Conducting this call for Northland Power are Christine Healy, President and CEO Jeff Hart, Chief Financial Officer and Adam Beaumont, Senior Vice President of Capital Markets.

Before we begin, Northland’s management has asked me to remind listeners that all figures presented are in Canadian dollars and to caution that certain information presented and responses to questions may contain forward looking statements that include assumptions and are subject to various risks. Actual results may differ materially from management’s expected or forecasted results. Please read the forward looking statements section in yesterday’s news release announcing Northland Power’s results and be guided by its contents when making investment decisions or recommendations. The release is available at www.northlandpower.com. I will now turn the call over to Ms.

Christine Healy.

Christine Healy, President and CEO, Northland Power: Thank you very much. Hello everyone. Thank you for joining today’s call. So I’ll start off today by providing an update on our business and the progress we’ve made on construction. Then Jeff is going to walk us through our Q1 results and following our prepared remarks, we will take questions.

But before I get into that, I want to take a moment and welcome Jeff Hart, who joined us on May as Northland Power’s newly appointed chief financial officer. Jeff brings over twenty years of financial leadership experience and deep experience in the energy industry. He’s previously been CFO at two large publicly traded Canadian energy companies, Husky Energy and Synovus Energy. And with Jeff joining the team, we’ve completed the formation of our strong executive leadership team, and we think we’re well positioned now to drive Northland’s long term growth, deliver on our mission and vision, and deliver value to shareholders. So welcome, Jeff.

So now to jump into the update here on Q1. I wanna start with health and health and safety, and health and safety remains a top priority across our business. I mentioned in our last call that I’ve been visiting sites across, Northland Power’s portfolio and meeting the operational teams. And I mentioned last call, and I can reiterate that the trend continues. The teams are committed.

They’re focused. There’s a high commitment to safety and operational excellence. So these teams are committed to keeping everyone on our projects and at our operating facilities safe. And I do want to take a moment, you may have missed the news about it, but just to further demonstrate our commitment and performance on safety. This quarter our EBSE utility in Columbia received the Honoris CCS Award for Innovation in Safety from the Colombian Safety Council.

This was a recognition of an innovative online tool created in that part of our business, streamlining safe work processes and permit to work for field staff. So this innovation by the team and the recognition of that innovation, wanted to call out here because it highlights the company wide commitment to developing innovative solutions and enhancing safety in our business. I also now want to turn more to operations and construction. So you may have seen that we had a very happy event recently that we announced commercial operations for the Oneida battery storage project. That project was completed ahead of schedule and under budget.

It is the largest energy storage project in Canada. It’s a clear reflection of Northland’s capability and expertise in safely and successfully delivering large scale infrastructure projects. At the local level, the project created over 180 jobs during peak construction, and the project delivered more than 300,000 work hours without a single lost time injury. So Oneida is now part of the grid here in Ontario and it’s generating revenue, Canada’s largest battery energy storage facility, one of the largest in the world, and it’s operational as we speak. It’s a great accomplishment for the team and for the partners in the project.

I’d like to extend my sincere congratulations to the joint teams on a job well done, and I’m looking forward to our teams applying their expertise in the next wave of battery storage projects, including our Jurassic storage project in Alberta. So we also have our two other offshore wind construction projects ongoing, High Long and Baltic Power. And together that represents approximately $15,000,000,000 in gross investment and 2.2 gigawatts of capacity shared between Northland and our partners. At Hai Long, our project in Taiwan, we’ve made strong progress against several key fronts, and I’ll take you through those. In April, we completed installation of the first turbine.

This is a major milestone for any offshore project, and, we were happy to see that milestone accomplished. We have now completed the fourth turbine installation, and construction continues to advance steadily and safely. On the manufacturing side, all the pin pile foundations are complete and the jacket foundation fabrication is progressing with several jackets in the final stage of production. We’re also making solid progress on turbine components with about half of the generators and blades manufactured and good momentum on nacelle and tower production as well. So if we move then to installation, all the pin pile foundations for Hailong 2 are in place.

Over 50% of the Hailong 3 pin pile foundations have also been installed. Our offshore substation foundations are fully installed. One topside is in place, and cold commissioning is complete. So overall Hailong remains on track to achieve full commercial operations by 2027. Turning to Poland, our 1.1 gigawatt Baltic power offshore wind project is also progressing as expected.

Fabrication of all 76 monopile foundations is complete. Manufacturing of the inner array cables is substantially finished and blade, nacelle, and tower fabrication has begun. On the installation side, both offshore substation main foundations have been installed. The topside structure is mechanically complete, and electrical outfitting is underway. In the water, 13 monopile foundations and two offshore substation monopiles have been installed.

Additionally, all of the horizontal drilling work for the export cables is complete, securing all four cable connections between offshore and onshore substations. So as you can tell, we’ve had successful completion of Oneida and continued progress on the offshore wind projects, So we are actively advancing our development pipeline. And so we of course are also at the same time developing new opportunities in our core markets. And as part of this pipeline, we’ve secured funding and begun construction on the Jurassic battery energy storage project, our second battery energy storage project in Canada. With the experience gained from Oneida, we’re confident in our ability to deliver Jurassic BEST on time and on budget.

In terms of other activities happening now to develop the pipeline in Ontario, we are engaged in the upcoming LT2 procurement process and we are evaluating opportunities within that process. Our early stage Scott Wind offshore wind project is also progressing and we’re continuing to explore attractive investment opportunities in key markets like the Baltic Region where we see a strong commitment from governments to ramp up support for renewable development. We are also working on other exciting growth opportunities, which I hope to share with you later in the year, and I’m sure you’re all eagerly anticipating our Investor Day. So before I hand things over to Jeff to review the financial results, I do briefly want to comment on our first quarter performance. As you’ve seen, our results were impacted by historically low offshore wind resource in the North Sea.

The wind was the lowest we’ve seen across our time invested in those, Europe offshore wind assets. And that needs to be held in contrast to what was record high wind performance in the same quarter last year. So when we’re comparing, we are comparing record high to unusual low. And despite this, though, our operational performance was strong. Fleet ability fleet availability stood at above 95% in the first quarter.

And here in Northland, we’re very focused on being good at the things within our control. So our teams were available, and had the wind resource been stronger, we would have been able to monetize that. I will also note that the teams did react to the low wind conditions, and they brought our planned maintenance forward. So our planned maintenance is ahead of schedule on the year. And this is an example of our operational teams in action.

With the lower wind resource, we could do more of that maintenance earlier in the year so that when the wind does blow, we are ready to take advantage of that through the remainder of the year. So our operating record is solid, and we’re maintaining our assets in good condition to ensure we can fully capitalize on favorable wind conditions when they occur. And I will also add, I’m sure it’s not lost on anyone, that as Hailong and Baltic come on stream and as Oneida has come on stream, the diversity, first of all, the geographic diversification and the technology diversification, the benefit of that shines through. Our strategy is to execute on projects in different geographies and those different geographies improve the balance of our production. And we will see the benefit of that coming over time as these projects are delivering results.

So I will add that even with the low wind this quarter, we remain on track to meet the financial guidance we set out earlier this year. I’m also just going to take a quick moment to touch on recent macroeconomic questions related to US tariffs and impact that they may have on our business. I can advise that today tariffs have minimal impact on our business here in Northland Power. None of the power that we sell is subject to tariffs. And in terms of development and construction, our supply agreements for our offshore wind construction projects and Jurassic battery project are locked or have robust provisions to provide protection from tariff costs.

So across our portfolio, we are in a good position in terms of dealing with this particular set of circumstances. So 20 so before I continue on, I will just say I’d ask all of you to hearken back to our fundamentals here. We do see that globally the demand for energy is growing, and the demand for renewables and natural gas is strong. And we at Northland are well positioned to meet this demand with our capabilities across technologies, with solar, onshore and offshore wind, gas, and now batteries, an important new component, a new tool in the toolkit. Plus, we have the capability to deliver in Canada, in Europe, and in Asia.

And these are capabilities that I think are key differentiators for Northland Power into the future. 2025 is a year of milestones for Northland, and our long term value proposition remains strong. We have the scale and the platform to pursue and execute large scale power projects. We have technological diversification, including the ability to develop, construct, and operate offshore wind, onshore solar and wind, battery storage, and natural gas power infrastructure. And the global diversification will be further enhanced when our two offshore projects are completed.

We also have strong people. Our team has the capability to originate, develop, construct, finance, and operate infrastructure projects globally. So overall, we see that the picture is strong for Northland heading into the future. Investment in renewables is accelerating. Renewable sources account today for just over 30% of global electricity generation, and that’s projected to rise to 46% by 02/1930 according to the IEA.

So again, Northland is well positioned to capitalize on this shift and help meet the world’s evolving energy needs and deliver value to shareholders. So with that, I’m going to turn things over to Jeff to give us a more detailed update on the financials.

Jeff Hart, Chief Financial Officer, Northland Power: Thank you, Christine, and good morning, everyone. I’m delighted to be here today as the newly appointed Chief Financial Officer of Northland Power. Joining the Northland team on May 1 has been exciting, and I’m eager to contribute to the company’s success and growth and have been impressed with the passion and dedication of our people. I look forward to working closely with Christine and the rest of the Northland team to build in an exciting future that will create shareholder value. With a strong balance sheet, talented team, we are well positioned for our construction program and future developments.

Now I’ll turn to our first quarter results. During the first quarter, we generated adjusted EBITDA of $361,000,000 which represents a 20% decrease compared to the same quarter of 2024, and this is predominantly due to the low offshore winds that Christine noted earlier. Despite the weak winds, our operations have performed well, driving strong availability, as demonstrated by our achievement of 95% commercial availability in the offshore wind business. The low offshore winds were partially offset with the higher rate base and customer growth at EBSA, and this combined with strong performance across the onshore fleet where we achieved availability of 97%, we offset some of those low wind impacts. During the first quarter, we generated free cash flow of $157,000,000 which was 30% lower than the same quarter of last year.

And on a per share basis, free cash flow in the first quarter of this year was $0.60 compares to $0.88 in the first quarter of ’twenty four. And despite the low offshore winds in Q1, we expect to maintain our financial guidance. I do want to highlight that we have made some changes to our non GAAP measures. Going forward, we will not be reporting two cash flow metrics, but will rather have a single cash flow measure that will be more aligned with our peer group, which provides a more appropriate run rate measure. Our new free cash flow metric, as reported in our results, is the same as our adjusted free cash flow metric that we previously reported.

This metric, we believe, represents Northland’s ability to generate cash flow from the operating business before any investment related decisions are made. And speaking of investment decisions, I’ll turn to our three construction projects. We successfully completed the Oneida battery storage project ahead of schedule and below budget. At the Hai Long and Baltic Power offshore wind projects, as of the end of the first quarter, the projects have spent $8,000,000,000 to date, with remaining gross capital expenditures for the projects expected to be $7,000,000,000 We have spent more than 50% on these two offshore wind projects, which demonstrate significant progress towards the achievement of commercial operations expected in ’twenty six and ’twenty seven. These accomplishments highlight Northland’s commitment to delivering high quality energy infrastructure and our readiness to capitalize on growth opportunities in global energy markets.

We have $1,100,000,000 of available corporate liquidity and have multiple funding tools to deliver on a disciplined growth strategy in our core markets. And we’ll share more details on our strategy and financial framework with you as part of our Investor Day expected to be scheduled later this year.

Christine Healy, President and CEO, Northland Power: Thank you, Jeff. So as you can see, we’re excited about the future of Northland. Our global technological diversification, focus on long term contracted profile and financial stability, These position the company well for growth for many years to come and to help withstand any short term political or regulatory shocks that might occur. Northland Power is growing and we’re delivering value for communities, for stakeholders, and more importantly, for shareholders. So this concludes our prepared remarks, and I’ll turn the call over to the operator.

Operator, can you please open the line for questions?

Conference Operator: Thank you. And our first question comes from Nelson Ng of RBC Capital Markets. Your line is open.

Nelson Ng, Analyst, RBC Capital Markets: Great, thanks. Good morning, everyone. And Jeff, congrats on your role as CFO. Thank you. I just want start with Oneida.

So just to clarify, costs being $100,000,000 below budget, does that directly reduce the equity funding requirement on a one for one basis, or is it kind of pro rata down equity?

Rupert Merer, Analyst, National Bank: Yeah. Dustin, I can take that one. So it’s not one to one. There’s a couple of things, including the debt service, the ITCs, that kind of get mixed in together. So it’s not a one to one reduction in equity.

Nelson Ng, Analyst, RBC Capital Markets: Okay. Thanks. And then also on Oneida, I know it’s still early days, but has there been any changes to your EBITDA or cash flow outlook since starting the project two years ago. And I think about 60% of their revenues are from capacity payments, so there there is a variable component. But, obviously, there has been a number of changes in terms of more RFPs and also power demand growth expectations in Ontario.

Jeff Hart, Chief Financial Officer, Northland Power: So it’s Jeff here, Adam can add on some color. But we expect ultimately the economics to be within the range of what we promised and delivered. And you’re right on the 60% there, and so we’re pleased with where it sits and how it’s going to fit on our portfolio, and it will deliver what our expectations were.

Nelson Ng, Analyst, RBC Capital Markets: Okay. That’s great. And then just one last thing. In terms of upcoming bids, I know Christine mentioned the Ontario bid later this year. But kind of looking further out, any can you talk about other areas of focus in terms of whether it’s wind or solar in Quebec or any other opportunities in BC or The UK?

Christine Healy, President and CEO, Northland Power: So, Nelson, thanks for the question. I’m really happy to hear some questions oriented towards future growth. That’s a really nice signal to me, so thanks for that. We are looking at all of we’re looking at a large number of opportunities across the market and organic opportunities and inorganic opportunities. I would say the same message that I had when we when we spoke in the last quarter update, internally in Northland Power, we have a competition for capital.

So all of these opportunities have to compete and show that they’re the best way for us to deploy our capital and deliver value. So I would say Canadian opportunities go into the mix, opportunities in Europe go into the mix, and we determine then where the best deployment of that capital is to drive value. So that is ongoing. I think that’s part of my job every day.

Nelson Ng, Analyst, RBC Capital Markets: Great. Thanks, Christina. I’ll get back in the queue.

Conference Operator: Thank you. And our next question comes from Sean Steuart of TD Cowen. Your line is open.

Sean Steuart, Analyst, TD Cowen: Thank you. Good morning. Welcome aboard, Jeff.

Benjamin Pham, Analyst, BMO: Thank you.

Sean Steuart, Analyst, TD Cowen: A couple of questions. Of the three gigawatts that you’re showing in the prospective pipeline that is onshore, how much of that three gigawatts would you qualify as late stage? And then I guess, Christine, more broadly, as you think about advancing growth opportunities, how do you think about the cadence of that? Presumably, there’s going be a focus on lowering the payout ratio here after a busy construction period for the company. The cadence and advancing those types of projects while managing the payout ratio, how do you think about that?

Christine Healy, President and CEO, Northland Power: Thanks, Sean. Appreciate the question. So with respect to the pipeline, I will refer you to our Investor Day. Again, I do think it’s a really positive sign. People are asking about growth.

So that’s I’m happy for that. But we’re doing work now on the pipeline and, the sequencing of that in order to, again, see which way we deliver the best value. So that’s a that’s a work in progress. And the nice news is that we have optionality there. So we’re, we’re considering how best to approach that.

So in terms of then what we do with capital allocation going forward, I think that’s also a burning question that we intend to answer at our Investor Day. It is something that we’re looking at very carefully. We see that there’s a massive growth in demand for what we do. And so we want to be able to deliver into that growth, but we also wanna be able to manage the capital allocation mix. So that’s very much on my mind, and, we will give more color on that at Investor Day.

Sean Steuart, Analyst, TD Cowen: Okay. And maybe I’m front running the Investor Day with this question as well. But perspective on gas fired power growth, lots of reports of rapidly expanding wait times for turbines and cost inflation for that technology. How are you thinking about growth potential for gas fired power, whether it’s in Canada or elsewhere? And does M and A potentially factor into the decision process as well?

Christine Healy, President and CEO, Northland Power: So I think I’ve mentioned before, Sean, but I like gas fired power. I think it’s an important part of the energy mix. In the work that I’ve done in my career, in in many geographies around the world, it’s very difficult to see how we can get to a a reliable, green, affordable grid without using natural gas. So I see it as as an important part of the energy mix globally. Now the question is, you know, is it better to, build or buy?

I think that’s an active question for everyone in the space. Your points on supply chain, I would say we’ve we’ve had a slightly different experience in that. We have some good relationship with our supply chain, and we see that we have some good options available to us should we choose to proceed with projects. So I I guess I would have a bit of a different perspective on that, but we watch carefully because with increasing interest in the natural gas generation space, then there could be upward pressure on that. But for us, we see that the things that we’re looking at, we don’t have a supply chain constraint right now.

Sean Steuart, Analyst, TD Cowen: Okay. Thanks very much for that detail. I’ll, get back in the queue.

Conference Operator: Thank you. And our next question comes from Mark Jarvi of CIBC. Your line is open.

Mark Jarvi, Analyst, CIBC: Yeah, thanks. Good morning, everyone, and welcome, Jeff. Maybe on the last topic about pursuit of natural gas investments, is that more focused on brownfield or is that greenfield? And I think just to pick up on your point, Christine, about having some options, are you implying that you would have access to gas turbines if you wanted to do greenfield?

Christine Healy, President and CEO, Northland Power: So Mark, thanks for the question. I think our set of solutions maybe is different than some others who are considering developments. So we have experienced teams who have been operating natural gas fired power for a very long time, and so they they have some different options in terms of development. So we’ve been looking at that internally and as we’re assessing things that we might want to pursue. So there is a mix, would say, of greenfield and brownfield.

There’s a mix of our own development pipeline and acquisition opportunities out there in the world. Those things we we look at again and we evaluate against one against them and against other alternatives in the portfolio. So I will say supply chain wise, think that there are some pockets where you can still make things happen. I think if you have a very fixed approach for how your development is going to go, there is some tightness in parts of the supply chain that that will be a problem if that’s your development mode. But for us, we’ve shown a good flexibility and agility to adapt to that.

So I think it’s again one of the things that I like about how we do business here at Northland.

Mark Jarvi, Analyst, CIBC: Just in terms of the development activity, is that all focused in Canada or have you broadened outside of Canada and would M and A include everything across North America, Canada, US?

Christine Healy, President and CEO, Northland Power: So Mark, I do think that there’s an interesting opportunity right now in Canada because Canada has underinvested, in my opinion, in natural gas fired power in the country. And we have one of globally, of the greenest grids in the world here in Canada, and natural gas has a really great ability to, provide a lot of services for stabilizing and enhancing the capability of that grid. So I think there’s a real opportunity for natural gas in Canada. So we’re having a really close look at that in a number of areas in Canada because as you know, Canada has a lot of separate markets. So we’re looking very closely at that.

I think we do see some opportunities internationally. So I will just but right now, those are much too early to talk about. So I’m just gonna leave it there.

Mark Jarvi, Analyst, CIBC: Okay. And then last week in the last weeks, we saw step away from the Hornsea four project over in Europe talking about higher costs and execution risk. Do you share the same views as them in terms of challenges to advance future offshore wind projects? And I guess, ultimately, the viability of Scott Wind and the South Korea projects, how do you see them framing up right now?

Christine Healy, President and CEO, Northland Power: Yeah. So I think, know, I was, like everyone, I think I was sad to see that news. It’s always difficult when projects don’t meet the mark, and I’m sure it couldn’t have been an easy decision for Orsted. For us, our projects are, developing within the parameters that we expected and delivering the returns that we expect to see. So we do see that we’re continuing to scan other projects that are out there to see if there are opportunities out there that even better than what are within our own portfolio.

I think that’s just good business, so we continue to do that. But, you know, you mentioned Scott Wind. I think that that’s a project we like. It’s some of the best wind resource anywhere in the North Sea. And so from a technical perspective, it’s a it’s a really strong project.

We’re proceeding through the community engagement process on that now. And as is always our way, we will advance projects at the pace and in the way that communities want to see them happen. But we have a great project there. And I think that eventually will come into the portfolio, you know, then so that those opportunities, I think, continue to exist. And fundamentally, we’re back to what’s the energy mix.

In many countries, it’s very difficult to make the energy mix work without offshore wind. It just makes a lot of sense. It delivers good, reliable, clean, reasonable cost electricity into the system. So to me, it makes a lot of sense.

Mark Jarvi, Analyst, CIBC: Good to hear. Maybe last question for me. Just the grid outage in Spain, any negative impacts for your operations there?

Christine Healy, President and CEO, Northland Power: No. Thank you for the question. I think that was a difficult moment in Spain, but I think that it was from our team’s perspective, it was handled well and safely with no impacts in terms of our infrastructure and capability in Spain. So I’m actually very impressed with the team in Spain and how they reacted to that unexpected circumstance. So it wasn’t a test we were looking for, but I’m pleased to say it’s a test that we passed with flying colors.

Mark Jarvi, Analyst, CIBC: Good. All right. Thanks for the time today.

Conference Operator: Thank you. And our next question comes from Rupert Merer of National Bank. Your line is open.

Rupert Merer, Analyst, National Bank: Hi. Good morning, everyone, and welcome, Jeff.

Jeff Hart, Chief Financial Officer, Northland Power: Thank you.

Rupert Merer, Analyst, National Bank: If I can start with Hai Long, so it sounds like things are moving well there, moving to plan. Can you remind us when are you expecting to generate the first power there? What’s your forecast for pre completion revenues this year?

Christine Healy, President and CEO, Northland Power: So we’re still saying the same as we’ve been saying throughout that first power will be in the back half of this year.

Rupert Merer, Analyst, National Bank: Okay. Do you have a certain number of turbines that you need to get installed before you turn it on there? And do you have a sense for how many turbines you might have installed before you reach the winter break this year?

Christine Healy, President and CEO, Northland Power: So, Rupert, I appreciate the push on that, but I don’t control the the met ocean conditions. So the first priority is that the teams have to, do this installation safely. So right now, they’ve been, having good productivity. They’ve been taking advantages of of some good weather situations. So we we’re seeing good installation, but we have a plan a, plan b, plan c for what happens, when conditions or if conditions change.

So, but to answer your technical question, no, we we are good. There’s not a minimum number of turbines in terms of generating first power, But of course, we do have a plan of turbine installation. As I said earlier, we’re on track.

Rupert Merer, Analyst, National Bank: Okay, great. And I’ll ask you a growth question too, Christine. Like those. We maybe talk about EDSA. You’ve had some good growth in in Colombia, and I know Northland pulled back from looking at organic growth around that utility historically.

What’s the outlook there? Do you see opportunities to put more capital to work in Colombia or do you see it more of a recycling opportunity in the future?

Christine Healy, President and CEO, Northland Power: Well, Rupert, I don’t want to tell all secrets too soon because we have Investor Day coming up in the fall. I will say that across the whole portfolio, one of the things we’re also looking at in our internal competition for capital is where do we have brownfield or augmentation opportunities within the existing fleet because those can often be very high rates of return investments. So we’re making sure that we have a close look at that. And I would say that that’s everywhere in the global portfolio that we’re looking at ways to enhance value. So then the rest I would say stay tuned for the fall.

Rupert Merer, Analyst, National Bank: And maybe follow-up on brownfield opportunities. So the last couple of years you were able to put some more capital into Thorold. That’s a good location here in Ontario. Could you see more brownfield investment going into sites like that and maybe even leveraging what you have some of your other sites, some other grid connections in Ontario?

Christine Healy, President and CEO, Northland Power: So Rupert, I would say there are a number of opportunities across the global portfolio. So not just in Canada, but internationally as well. And so the teams are working hard on those and to see how would we sequence prioritize them? But, we do see that there are there are brownfield opportunities. They involve deployments, you know, similar to Thorold.

They involve deployment of some capital, but with very quick returns for us. So and that’s an opportunity and sometimes it can lead to a change in our terms that would extend the lives of these facilities as well. So we see some good opportunities there but again the teams have to bring them forward and then they have to compete for the capital.

Rupert Merer, Analyst, National Bank: All right, very good. I’ll leave it there. Thank you.

Conference Operator: Thanks. Thank you. And our next question comes from Robert Hope of Scotiabank. Your line is open.

Robert Hope, Analyst, Scotiabank: Good morning, everyone, and congrats, Jeff.

Benjamin Pham, Analyst, BMO: Thank you.

Robert Hope, Analyst, Scotiabank: Maybe on Hai Long, can you talk about the supply chain? Where have you seen the largest improvements? Are there any remaining challenges? Or kind of where do you think the key pinch points are on the supply chain, or is everything looking good?

Christine Healy, President and CEO, Northland Power: Well, thanks for the question, Rob. I’m never going to say everything’s looking good because I feel like that’s not not the right message. I think the message is that everything is on track. We have had to do a lot of work with our supply chain, for Hai Long. We are making sure that we deliver on expectations, you know, in terms of local content, and we ensure that we deliver on expectations for schedule and cost.

So the supply chain, I think now we’re seeing is delivering very well. So, in some cases, there were slower starts than we wanted to see, but now we see that the supply chain is delivering the way that we want. I will add that we have a very high emphasis on safety, and we continue to follow-up with our entire supply chain to ensure that they meet our safety standards in all the work that they do.

Robert Hope, Analyst, Scotiabank: I appreciate that. And then maybe just on the supply chain for Baltic, it’s a little bit more diversified. How are things progressing there, or do you have more kind of levers, to pull there?

Christine Healy, President and CEO, Northland Power: So Baltic is on track. I would say we never let up on attention to the supply chain. And you may or may not be aware, but we, you know, we put people, our Northland resources in facilities around the world to track the delivery of our supply chain and make sure that things are on track. So we follow that up closely. So I would say we have no level of we just have constant vigilance, maybe I’ll say on that.

We we have people who are following that and I’m getting reports on that very frequently because it’s so critical to our success on the project. And so I would say I wouldn’t put it in the category of we’re more or less relaxed. We’re constantly vigilant on all of it.

Robert Hope, Analyst, Scotiabank: All right. Appreciate the color. Thank you.

Conference Operator: Thank you. And our next question comes from Benjamin Pham of BMO. Your line is open.

Benjamin Pham, Analyst, BMO: Hi, thanks. Good morning. Maybe a first question on the Q1 and the 2025 guidance. You flagged the offshore wind weakness. Can you comment I know it’s an industry trend in Europe with the weakness.

Do you know what’s driving that overall? And what are you seeing so far in Q2?

Christine Healy, President and CEO, Northland Power: Do you mean, sorry, on the wind resource generally?

Benjamin Pham, Analyst, BMO: Yeah. Do you know what’s driving the weak offshore wind resource?

Christine Healy, President and CEO, Northland Power: Well, the wind resource is, you know, everything that we do is probabilistic. So we gather met ocean data. We analyze it. And every day as we get more data, these models are further and further refined. So when we look at the tracking over sort of a decade or more of wind speed in the area, then you have a range.

And then we do our budgeting based on what we think a likely outcome is for the year. Now there are going to be years, like q one last year was exceptionally high. And everybody’s very happy when that happens, but it’s also unusual. This year, we’re on the lower end of the curve, so less happy. But again, it’s within a range of expected outcomes.

It’s not where you would probabilistically expect it to be. So that’s why I referred earlier about, you know, we’re geographically correlated now with our three offshore wind facilities there in the North Sea. They’re reasonably close to each other, so they’re all kind of affected by similar wind patterns. When we add on a facility in the Baltic, that will be a different set of met ocean conditions, different set of wind conditions. And similarly, when we add on Hai Long, it’s again a different geography, different wind.

So you should not see the same amount of correlation that we have now with three facilities that are close to each other. So it’s a bit about finding the balance. There’s economies of scale when we have facilities close to each other because our operational teams can be deployed across multiple facilities. But then we do have this issue that when there is less wind in a geography, it affects all of them at the same time. So we try to strike that right balance between diversification and intensity.

Benjamin Pham, Analyst, BMO: Okay. Got it, Christine. Maybe just to clarify, that doesn’t seem like there’s anything specific that the meteorologists have flagged. I’m just thinking about the twenty eighteen-nineteen experience. You had very warm temperatures in Europe driving low wind speeds, and that’s when we saw something like this.

You’re not you’re seeing anything really pinpoint here to to drive the weakness?

Christine Healy, President and CEO, Northland Power: No. I mean, I I think that I’m I’m gonna I’m well out of my depth because I’m not a meteorological expert, But no, we don’t see anything here that’s causing us any great concern. I mean, we would have preferred if the wind blew more in Q1, obviously, but we still see that the overall picture for these assets is really positive.

Benjamin Pham, Analyst, BMO: Okay, thanks for that. Then the next question for Jeff, welcome.

Jeff Hart, Chief Financial Officer, Northland Power: Thank you.

Benjamin Pham, Analyst, BMO: Can you talk about just what attracted you to the Northland Power? Just I know it’s been a few weeks, your initial thoughts on the balance sheet. And then lastly, just any work projects that are priorities for you the next little bit into the Investor Day?

Jeff Hart, Chief Financial Officer, Northland Power: So, yeah, thanks for the question. And you’re rounding up. I think I’ve been in a week or a little over. But I’ll just give you some context on the macro and why Northland, and then I’ll turn my attention to my thoughts and priorities and my impressions. I’ve been around the energy complex and energy systems my entire life.

Over the last twenty years, I’ve been in the integrated oil space as both CFO of Husky and Synovus, I’ve also led supply chain, global regulatory organizations and safety organizations. And so I am passionate about energy, and I’m really bullish and look at for the quality of life, energy demand is going to continually rise, and we need to rise to that challenge to deliver the energy. So with that is why Northland. And Christine has talked to it. I think it’s the diversification, the platform that we can build from.

We’re going to need as much energy as possible, whether it be onshore wind, offshore wind, natural gas generation. And so I think that platform attracted me, number one. Number two is, I was impressed with Christine and the leadership team while I was coming in. And my impressions coming in, and you can see it in the quarter, we have to focus on what we can control, which is our operations, availability, uptimes, and project execution, and I’ve been really impressed with the organization and depth there coming in. And then as far as priorities go over the next little while, number one is obviously get out to the assets.

It gets back to that theme as we need to control what we can control. I think it’s important that the executive are totally integrated with our operations and have a good understanding on the ground, number one. Number two, really get out and meet with our key investors and analysts and really get to meet the street and build, hear feedback and understand where their thoughts are and priorities, which then will help us lead into and where we’re taking the company forward and pursue the right kind of growth that drives shareholder returns and lay that out at Investor Day, and that’s really it at a high level and I’ll leave it there.

Benjamin Pham, Analyst, BMO: Okay, that’s great. Thank you. That’s good color.

Conference Operator: Thank you. I’m showing no further questions at this time. I’d like to turn it back to Christine Healy for closing remarks.

Christine Healy, President and CEO, Northland Power: Well, thank you very much. I’m not sure there’s much else left to say. I will say thank you to everyone for joining us today. Our next earnings call will be after our Q2 results and we’re anticipating that in August. So thank you for your attention and your questions and your continued support.

Conference Operator: This concludes today’s conference call. Thank you for participating and you may now disconnect.

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