Capstone Infrastructure Corp (TSX: CSE, OTC: MCQPF) has signed a new 20-year non-utility generator contract with the Ontario Power Authority for its 156 megawatt (MW) Cardinal combined-cycle, natural gas-fired facility. The new contract will be effective Jan. 1, 2015, and will expire Dec. 31, 2034.

In one sense the deal took much longer than anticipated, as the negotiation of a new power purchase agreement with the OPA had been hanging over Capstone’s share price for more than a year.

In another sense it came together quickly, as recent OPA dealings with other power generators, including TransAlta Corp (TSX: TA, NYSE: TAC), suggested the bargaining process would play out through the summer.

Timing issues aside, the highlight for Capstone shareholders must be management’s assertion that the new PPA “provides certainty…on Cardinal’s longevity and contribution to Capstone’s cash flow profile and dividend sustainability following 2014.”

Starting in 2015, Cardinal, as expected, will become a dispatchable facility rather than a baseload generator, supplying electricity to the Ontario grid only when needed. The new contract provides Cardinal with a fixed monthly payment, escalating annually according to a pre-defined formula, intended to cover Cardinal’s fixed operating costs and return on capital.

Cardinal will also earn variable market revenue from the electricity it delivers to Ontario’s power grid. It will be responsible for arranging its own gas supply. Management expects to invest approximately CAD30 million over 2014 and 2015 to prepare Cardinal for cycling, including purchasing a new rotor and related equipment to extend and enhance the facility’s capabilities.

Capstone expects Cardinal to generate adjusted earnings before interest, taxation, depreciation and amortization (EBITDA) of CAD7 million to CAD9 million in 2015.

Based on the company’s current portfolio and with Cardinal’s new PPA, management intends to maintain its current quarterly dividend rate of CAD0.075 per share, which is “sustainable over the long term.”

Management’s target average long-term payout ratio is approximately 70 percent to 80 percent of adjusted funds from operations (AFFO). Capstone expects to meet this range by 2017, when the current pipeline of wind power projects is expected to be fully commissioned and generating cash flow.

Management also anticipates increased dividends from Bristol Water during the next regulatory period, which commences in April 2015 and concludes in March 2020.

Capstone’s payout ratio in 2015 and 2016 will likely exceed 100 percent of AFFO, reflecting Cardinal’s reduced cash flow contribution starting in 2015. But management believes it has sufficient liquidity to fund its needs over this period, including cash and cash equivalents on hand, operating cash flows from its various businesses, and its corporate credit facility.

Capstone reported 8.9 percent growth in revenue for 2013 compared to 2012, primarily due to Bristol Water, where regulated water tariffs and water consumption were higher than in 2012, and to higher power production attributable to the Cardinal gas cogeneration facility, Erie Shores and the contribution from the operating wind power facilities acquired on Oct. 1, 2013.

Adjusted EBITDA were up 6.7 percent, driven primarily by Bristol Water and higher power production at Cardinal and Erie Shores, along with the contribution from the new wind facilities.

AFFO were up 12.3 percent to CAD39.9 million, while AFFO per share grew by 4.1 percent to CAD0.493.

Based on an annualized dividend rate of CAD0.30 the payout ratio for 2013 was 60.9 percent, down from 95.1 percent in 2012. Capstone Infrastructure is a hold.

Atlantic Power Corp (TSX: ATP, NYSE: AT) reported 2013 project income of USD64.3 million compared to a project loss of USD29.4 million in 2012, though cash available for distribution declined by USD22.8 million to USD108.8 million.

Management’s prepared remarks and answers to analysts’ questions during the company’s third-quarter conference call left open the distinct possibility of another dividend cut announcement in early 2014. Such a move has apparently been put off, as Atlantic continues to make other moves to repair its balance sheet.

Delaying what seems an inevitable follow-on dividend has given some lift to the share price. If you haven’t exited yet this could be your opportunity to do so. Sell.

Barrick Gold Corp (TSX: ABX, NYSE: ABX) posted a 2013 net loss of CAD10.37 billion, or CAD10.14 per share, including after-tax impairment charges of CAD11.54 billion. Adjusted net earnings were CAD2.57 billion, or CAD2.51 per share, while operating cash flow of CAD4.24 billion demonstrates the underlying business remains viable.

Barrick’s balance sheet is still shaky, burdened by USD15.8 billion of debt, though only USD1.8 billion is maturing between now and the end of 2015. Sell.

Bonavista Energy Corp (TSX: BNP, OTC: BNPUF) reported a 26 percent increase in 2013 funds from operations (FFO) compared to 2012, with FFO per share up 12 percent, as better natural gas prices and management’s focus on operating and capital efficiencies drove growth.

Costs of adding production declined to approximately CAD21,000 per barrel of oil equivalent per day (boe/d) during the fourth quarter, down from CAD32,500 per boe/d during the prior corresponding period.

Operating costs improved by 2 percent to CAD8.93 per boe from CAD9.07 per boe in 2012. Operating costs for the three months ended Dec. 31, 2013, were CAD8.77 per boe.

Bonavista posted record average annual production of 73,406 boe/d, a 6 percent increase over 2012. Fourth-quarter production averaged 75,072 boe/d. The company is currently producing approximately 74,000 boe/d, net of recent dispositions of approximately 2,500 boe/d during the first quarter for proceeds of CAD103 million. Buy under USD16.

Capstone Infrastructure Corp’s (TSX: CSE, OTC: MCQPF) place on the Watch List is explained above. Hold.

Colabor Group Inc (TSX: GCL, OTC: COLFF) reported that 2013 sales declined by 1.9 percent to CAD1.439 billion, while earnings before interest, taxation, depreciation and amortization (EBITDA) were down 13 percent to CAD34.03 million.

On a positive note, fourth-quarter post-dividend cash flow improved by 45 percent to CAD4.8 million, and management noted solid progress on its turnaround effort. The full-year payout ratio was 71 percent.

The dividend rate was maintained at CAD0.06 per share. Hold.

Crius Energy Trust (TSX: KWH-U, OTC: CRIUF) reported 2013 revenue of USD507.1 million and gross margin of USD103.4 million, or 20.4 percent of revenue, as electricity and natural gas customers grew by 15.1 percent during the year–its first full year in operation–to 615,373.

On Feb. 10, 2014, management cut the monthly dividend rate by 30 percent from CAD0.0833 to CAD0.0583, attributing the decision to soaring costs of energy during a particularly cold first quarter in the markets it serves as well as slowing customer growth.

Management expects to maintain the new level throughout 2014. The board will review the dividend policy at year’s end, which suggests another cut from the present annualized rate of CAD0.70 is possible.

The market is clearly pricing in another dividend cut, with the yield on the stock–based on the reduced dividend rate–as of this writing at 19.7 percent. Hold.

Eagle Energy Trust (TSX: EGL-U, OTC: ENYTF) reported 2013 average sales volumes of 3,004 barrels of oil equivalent per day (boe/d), up 15.7 percent versus 2012. Funds from operations were steady at CAD1.44 per unit, while operating costs per boe declined by 14 percent to CAD12.73.

The small producer’s fortunes remain particularly tied to ups and downs of commodity prices. Hold.

Equal Energy Ltd (TSX: EQU, NYSE: EQU), pursuant to the agreement by which Petroflow Energy Corp will acquire it, won’t pay a first-quarter dividend.

Equal reported that 2013 oil, gas and natural gas liquids (NGL) revenue per barrel of oil equivalent (boe) was up 16 percent on higher realized prices, while proved reserves grew by 23 percent to 23.4 million boe.

According to terms of a deal announced Dec. 6, 2013, Equal shareholders will receive USD5.43 per share in cash. Paying a dividend would reduce that amount by one equal to the dividend. Equal’s last dividend will therefore be the “permitted dividend,” according to the terms of the merger agreement, paid Dec. 20, 2013, to shareholders of record as of Dec. 2, 2013. Hold.

FP Newspapers Inc’s (TSX: FP, OTC: FPNUF) 2013 revenue slipped to CAD7 million from CAD7.2 million, as sales for FP LP, the operating entity from which FP Newspapers derives its cash flow, declined by 4.7 percent to CAD106.3 million.

Earnings before interest, taxation, depreciation and amortization (EBITDA) were down 4.1 percent, as print advertising slid 6.3 percent.

Management once again maintained the CAD0.05 dividend rate for the March payment due April 30, as the full-year payout ratio came in at 87 percent. Sell.

Freehold Royalties Ltd (TSX: FRU, OTC: FRHLF) reported that 2013 gross revenue increased by 8 percent to CAD181.58 million, while funds from operations (FFO) per unit rose 12 percent to CAD1.79.

Average daily production was 8,913 barrels of oil equivalent per day (boe/d), up 1 percent from 8,850 boe/d in 2012, as average realized prices were up 8 percent.

The full-year payout ratio was 94 percent.

Debt reduction efforts have been significant and successful. But there’s not much margin for error for a relatively small producer that’s dependent on commodity prices rather than production growth to drive FFO growth and dividend stability. Hold.

GMP Capital Inc (TSX: GMP, GMPXF) reported a 17.9 percent decline in 2013 revenue to CAD219.5 million. Net income was CAD9.6 million, up from CAD6.1 million a year ago, and the loss per diluted share shrank to CAD0.02 from CAD0.04. The payout ratio was once again negative.

Management, though, expressed optimism about 2014 based on trading conditions during the latter part of 2013 and in early 2014. Sell.

Labrador Iron Ore Royalty Corp (TSX: LIF, OTC: LIFZF) posted 2013 adjusted cash flow of CAD115.4 million, or CAD1.80 per share, up from CAD75.1 million, or CAD1.17 per share, for 2012. Sales volumes for Iron Ore Company of Canada were 14.8 million metric tons, up from 14.1 million a year ago.

The ultimate fate of the dividend is tied to what happens with the facility that generates Labrador’s cash flow. Rio Tinto’s (London: RIO, ASX: RIO, NYSE: RIO) efforts to sell its controlling stake have thus far been unsuccessful. Hold.

Northland Power Inc (TSX: NPI, OTC: NPIFF) reported a 54.1 percent increase in 2013 revenue to CAD557.2 million, while free cash flow more than doubled to CAD130.1 million. Electricity sales volumes were up 41.4 percent, and the addition of new projects and capacity continues in early 2014.

Northland is clearly on the way toward fulfilling management’s forecast that free cash flow will cover the dividend in 2014. Hold.

Parallel Energy Trust’s (TSX: PLT-U, OTC: PEYTF) average production for 2013 was up 20.6 percent compared to 2012 to 7,147 barrels of oil equivalent per day (boe/d), as average sales prices were up 7 percent to USD42.62 per boe. Proved plus probable reserves increased by 4.9 percent.

Funds from operations (FFO) grew by 19.7 percent to CAD41.96 million, as the full-year payout ratio came in at a healthy 76 percent. Hold.

Precious Metals & Mining Trust’s (TSX: MMP-U, OTC: PMMTF) manager, Sentry Investments Inc, announced on June 27, 2013, that Precious Metals & Mining’s monthly cash distribution “will be changed” from CAD0.07 per unit to CAD0.035 per unit.

This 50 percent cut became effective with the Aug. 15, 2013, payment to unitholders of record on July 31, 2013, and will remain at this level until further guidance is provided by Sentry.

The Sentry board made the move “given the current environment for gold mining equities,” which comprise the bulk of Precious Metals & Mining’s portfolio.

The price of bullion increased more than five-fold from 2003 to 2011. But major gold mining companies generated little to no free cash flow. And they’re likely to generate negative free cash over the next several years. Sell.

Ten Peaks Coffee Company Inc (TSX: TPK, OTC: SWSSF) reported a 9.8 percent decline in 2013 sales to CAD53.87 million, though processing volumes, gross profit, net income and earnings before interest, taxation, depreciation and amortization (EBITDA) were all up versus 2012.

Coffee is still a tough, volatile business, and it’s a hard model on which to base a dividend-paying business. Hold.

Zargon Oil & Gas Ltd (TSX: ZAR, OTC: ZARFF) posted an 8 percent decline in 2013 production to 7,468 barrels of oil equivalent per day (boe/d) due to property sales and modest oil exploitation, though funds from operations (FFO) ticked up by 3 percent to CAD58.48 million, or CAD1.95 per share, on higher commodity prices.

The production trend is worrisome, particularly for a relatively small company so susceptible to commodity-price movements.