Mr. Mike Crawley reports

NORTHLAND POWER REPORTS FOURTH QUARTER 2023 RESULTS AND ANNOUNCES 2024 FINANCIAL OUTLOOK

Northland Power Inc. has released financial results for the three months and year ended Dec. 31, 2023. All dollar amounts set out herein are in thousands of dollars, unless otherwise stated.

Financial results:

• Sales were $626-million in the fourth quarter of 2023 compared with $641-million in 2022. On a full-year basis, sales were $2,233-million in 2023 compared with $2,449-million in 2022.
• Gross profit was $566-million in the fourth quarter of 2023 compared with $574-million in 2022. On a full-year basis, gross profit was $2,021-million in 2023 compared with $2,178-million in 2022.
• Net loss was $268-million in the fourth quarter of 2023 compared with net income of $324-million in 2022. On a full-year basis, net loss was $96-million in 2023 compared with net income of $955-million in 2022.
• Adjusted earnings before interest, taxes, depreciation and amortization (a non-international financial reporting standard measure) were $389-million in the fourth quarter of 2023 compared with $353-million in 2022. On a full-year basis, adjusted EBITDA was $1.24-billion in 2023 compared with $1,398-million in 2022.
• Adjusted free cash flow per share (a non-IFRS measure) was 75 cents in the fourth quarter of 2023 compared with 16 cents in 2022. On a full-year basis, adjusted free cash flow per share was $1.97 in 2023 compared with $1.95 in 2022.
• Free cash flow per share (a non-IFRS measure) was 75 cents in the fourth quarter of 2023 compared with six cents in 2022. On a full-year basis, free cash flow per share was $1.68 compared with $1.61 in 2022.

"Northland performed well in 2023. We achieved adjusted EBITDA and exceeded guidance for adjusted free cash flow and free cash flow. The financial and operating performance for 2023 is a testament to both the capability of our team and the resilience of our business. Notwithstanding the challenges experienced within the industry and the economy more broadly, Northland demonstrated our resilience, achieving several significant milestones in 2023, including reaching financial close on our two major offshore wind projects, Hai Long and Baltic Power, and our energy storage project, Oneida. Construction for all three projects is now under way and progressing well. In addition, we successfully executed several partnership agreements within our offshore wind projects in Scotland and Taiwan. These accomplishments continue to reinforce our capability and expertise to develop, secure strong partnerships, and finance and execute upon complex, large-scale projects," Mike Crawley, Northland's president and chief executive officer noted.

Fourth quarter and full-year 2023 financial results

Northland achieved original 2023 guidance for adjusted EBITDA and exceeded guidance for adjusted free cash flow and free cash flow per share. Performance in the fourth quarter was particularly strong, driven by higher-than-expected sell-down gains and higher production from its offshore wind facilities, partially offset by lower onshore renewables production due to lower wind and solar resources.

On a year-over-year basis, full-year adjusted EBITDA decreased primarily due to the non-recurrence of the unprecedented spike in market prices realized in 2022 in Europe, partially offset by higher band adjustment revenue recognized from Northland's Spanish portfolio and sell-down gains realized on its development assets in Europe and Asia. With respect to adjusted free cash flow and free cash flow per share, in addition to the same factors as above, both the Spanish portfolio debt optimization completed in the fourth quarter of 2023 and gains from foreign exchange hedge settlements resulted in higher reported results compared with 2022.

The attached table presents key IFRS and non-IFRS financial measures and operational results. Sales, gross profit, operating income and net income, as reported under IFRS, include consolidated results of entities not wholly owned by Northland, whereas Northland's non-IFRS measures include only Northland's proportionate ownership interest.

Board of directors

On Nov. 29, 2023, Northland announced the expansion of its board of directors from nine to 10 members and the immediate appointment of Ellen Smith as a director. Ms. Smith brings over 35 years of leadership experience within the power and utilities sector.

Project delivery committee

During the fourth quarter of 2023, the board of directors formed a new subcommittee: the project delivery committee. The purpose of the project delivery committee is to assist the board of directors with monitoring and overseeing projects in which the company has an interest during construction.

Executive changes

On Jan. 15, 2024, Northland announced several changes to its executive team. Pauline Alimchandani, chief financial officer, will be departing the company, effective Feb. 22, 2024, to pursue another opportunity. Until a new CFO is appointed, Adam Beaumont, vice-president, finance, and head of capital markets, will oversee the finance function on an interim basis. David Povall, executive vice-president of offshore wind, departed the company as well. Toby Edmonds will join Northland as executive vice-president of offshore wind, bringing essential offshore project execution and operational experience. In addition, Yonni Fushman, who joined Northland in January, 2023, as chief legal officer and executive vice-president of sustainability, has been promoted to chief administrative and legal officer, and will continue to serve as corporate secretary.

Fourth quarter earnings conference call

Northland will hold an earnings conference call on Feb. 22, 2024, to discuss its fourth quarter and full-year 2023 results. The call will be hosted by Northland's senior management, which will discuss the company's financial results and developments, as well as answer questions from analysts.

Conference call details are as follows.

When:  Thursday, Feb. 22, 2024, at 10 a.m. ET

Participants wishing to join the call and ask questions must register.

For all other attendees, the call will be broadcast live on the Internet in listen-only mode.

For those unable to attend the live call, an audio recording will be available on the Northland website on Friday, Feb. 23, 2024.

Northland's audited consolidated financial statements for the year ended Dec. 31, 2023, and related management's discussion and analysis, can be found on SEDAR+ under Northland's profile and on the Northland website.

About Northland Power Inc.

Northland is a global power producer dedicated to helping the clean energy transition by producing electricity from clean renewable resources. Founded in 1987, Northland has a long history of developing, building, owning and operating clean and green power infrastructure assets, and is a global leader in offshore wind. In addition, Northland owns and manages a diversified generation mix, including onshore renewables and efficient natural gas energy, as well as supplying energy through a regulated utility.

Headquartered in Toronto, Canada, with global offices in eight countries, Northland owns or has an economic interest in approximately 3.4 gigawatts (net 2.9 gigawatts) of operating capacity. The company also has a significant inventory of projects in construction and in various stages of development encompassing approximately 12 gigawatts of potential capacity.

Publicly traded since 1997, Northland's common shares, and Series 1 and Series 2 preferred shares, trade on the Toronto Stock Exchange under the symbols NPI, NPI.PR.A and NPI.PR.B, respectively.

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