Manitoba Hydro income down, debt on the rise
Mild winter blamed for chopping two thirds of net income; debt now $14.2B
Manitoba Hydro's net income for 2015-16 dropped by more than two thirds over the previous year, while its debt rose nearly $2 billion.
Hydro's net income was $39 million during the most recent fiscal year, down $84 million from 2014-15, when it was $125 million, states the Crown corporation's annual report, which attributes the drop to a mild winter as well as hydro-electric plant construction.
"The decrease in net income is a result of lower domestic revenues primarily due to milder winter weather as well as an increase in capital investment related expenses such as finance costs, depreciation and capital taxes associated with new plant going into service," the report states.
Hydro expects a return to average winter weather will improve its books.
"Export prices for the first three quarters of 2016-17 are expected to resemble prices experienced this past year, with a recovery expected for the last quarter assuming normal winter weather, based on current conditions, Manitoba Hydro expects its net income for 2016-17 to be marginally higher than what was experienced in 2015-16," the report states.
Hydro's long-term debt increased to $14.2 billion as of March 31, up from $12.3 billion at the same date in 2015.
The Crown corporation's debt is expected to climb to $25 billion over the next three or four years, prompting board chair Sanford Riley to identify the red ink as a "huge concern."
At a public consultation meeting, Riley also said the utility was considering asking for an equity investment from the province.
- With files from Sean Kavanagh