Higher Rainfall Boosts These 2 Trusts

Article Excerpt

GREAT LAKES HYDRO INCOME FUND $18.70 (Toronto symbol GLH.UN; SI Rating: Extra Risk) owns five hydroelectric power generation, transmission and distribution systems, in Quebec, B.C., New England and Ontario. Its facilities have 995 megawatts of generating capacity. In the three months ended December 31, 2005, Great Lakes’ revenues rose 29.8%, to $39.2 million from $30.2 million. Cash flow per share more than doubled, to $0.35 from $0.17. Improved rainfall boosted the fund’s power generation in Ontario, and reservoir levels are now above average. The long-term outlook for Great Lakes depends on the satisfactory operating performance of its plants. The company is also subject to environmental regulations. When its long-term contracts come up for renewal, they may be hurt or helped by continuing deregulation of power generation. However, most hydroelectric projects cause little environmental damage because they return water to the river with no pollution. And unlike fossil-fuel generation plants, Great Lakes Hydro profits when high oil and gas prices push up power rates. Great…

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