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Linton Hydro

Financial performance

Linton Hydro raised £2,500,000 through its 2016 bond offer in order to develop a new pre-accredited 280 kW hydro power scheme at Linton Lock near York, North Yorkshire and to acquire Flowpower Limited, which operates an existing hydro scheme adjacent to the Linton Lock scheme site.

Project costs

The total funding requirement for the construction of the Linton Lock scheme and the acquisition of the existing Flowpower scheme, including refinancing debt, was £2,500,000. The directors raised this through the 2016 Bond Offer.

Key assumptions

The key assumptions underlying these projections are as follows:

  • Construction of the Linton Lock scheme is completed in December 2016.
  • Electricity generation for the Linton Lock scheme is based on an energy yield assessment carried out by My Green Investment CIC, an experienced hydro consultancy.
  • The Linton Lock scheme begins generating electricity in the first quarter of 2017 and generates around 1,250 MWh of electricity a year.
  • The Linton lock scheme secures a FIT of 12.82p/kWh.
  • The Flowpower scheme generates 620 MWh of electricity a year and benefits from a FIT of 21p/kWh.
  • The Bond is repaid in eight equal annual instalments using the retained cash generated by the Linton Lock and Flowpower projects. The first repayment is made in June 2019 and the final repayment in June 2026.

Annual return

Linton Hydro Limited aims to pay bondholders a gross return of 7.5% gross per year, fixed and payable (net of UK basic rate tax) annually in arrears on 30 June.

Payment of interest is not guaranteed and is dependent on the continued success of the Flowpower scheme and the successful construction and operation of the Linton Lock scheme.

Projected income and expenses

A summary of Linton Hydro’s consolidated financial projections is shown below.

Income and expenditure
Year-ended 31 March
2017 Projected £,000 2018 Projected £,000 2019 Projected £,000 2020 Projected £,000 2021 Projected £,000 2022 Projected £,000 2023 Projected £,000 2024-25 Projected £,000 2026-27 Projected £,000
Income 191 402 414 427 439 453 466 975 1,034
Operating costs (26) (51) (53) (55) (56) (58) (59) (197) (283)
Depreciation (67) (142) (141) (140) (139) (139) (138) (274) (271)
Profit before interest and tax 98 209 220 232 244 256 269 504 480
Other interest 3 - 2 1 3 1 3 3 -
Bond interest (152) (188) (188) (188) (164) (141) (117) (164) (70)
Profit before tax (51) 21 34 45 83 116 155 343 410

Note: Forward-looking statements are merely unaudited projections based on a number of assumptions and should not be relied upon as indicators of future performance. There is no guarantee these projections will be achieved.

Forecast income is derived from the sale of electricity generated by the two hydro power schemes and payments received through the Feed-in Tariff scheme linked to the generation of renewable electricity.

Operating costs principally include annual rent, insurance and operation and maintenance costs - which will be outsourced to Mann Power Consulting (a related party to Linton Hydro).

Forecasted balance sheet

A summary of Linton Hydro’s forecasted consolidated balance sheet following the successful construction and commissioning of the Linton Lock scheme (at 31 December 2016) is as follows:

Balance Sheet 31-Dec-16
Fixed assets 2,398
Current assets
Cash 417
Other current assets 210
Current liabilities 62
Non current liabilities
Bond 2,500
Other non current liabilities 22
Net assets 441
Represented by shareholder capital:
Share capital 494
Retained reserves (53)
Shareholders funds 441

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