AES Gets Outstanding Receivables From NEK, Sees 1Q EPS To Be Significantly Below Last Year

AES Corp

revealed that one of its subsidiaries, AES 3C Maritza East I (Maritza) in Bulgaria, received $350 million as outstanding receivables from NEK, the state-owned wholesale power company. According to the company, the payment was related to the amendment to Maritza's Power Purchase Agreement (PPA) signed in August 2015. AES said that Maritza would use the major portion of the proceeds to pay the local coal mine, which was the supplier of the plant, and also repay the lenders of the plant's non-recourse debt. The company's President and CEO, Andres Gluski, said that "As a direct result of the steps taken by the Government of Bulgaria to strengthen the financial position of NEK, Maritza has received full payment of its outstanding receivables. Maritza is one of the most reliable and cleanest coal-fired plants in Europe, using only domestically sourced fuel. By meeting all of its contractual obligations, Bulgaria is sending a very positive sign to all foreign investors in the country." The company also disclosed that under the amendment, both agreed to make some changes to the PPA. That included slashing the capacity payment to Maritza by 14 percent through 2026, the PPA term. In return, NEK agreed to pay Maritza its full outstanding receivables. The company added that these terms were previously added in its 2016 guidance and 2017-2018 expectations. Additionally, the AES reaffirmed its 2016 guidance for all metrics. That meant its adjusted EPS outlook of $0.95 - $1.05 remains, which is short of the Street analysts' estimations of $1.03 a share. Similarly, the Company disclosed that it expects its first quarter Adjusted EPS to be significantly below $0.25, which was 20% of full year 2015 Adjusted EPS. The company added that its results were impacted by various things. Street analysts predict the company to earn $0.20 a share. The company will report its earnings report on May 9. Shares of the company traded higher by 1.86% on Tuesday.