CALGARY, AB, March 3, 2021 /CNW/ -
Fourth Quarter 2020 Financial Highlights
- Comparable EBITDA(1) of $234
million compared to $243
million for the same period in 2019
- Free Cash Flow ("FCF")(1) of $52 million or $0.19 per share in the quarter compared to
$121 million or $0.43 per share for the same period in 2019
Full Year 2020 Financial Operating Highlights
- Comparable EBITDA(1,3) of $927 million compared to $928 million for the year ending 2019 adjusted
for PPA Termination Payments (as defined below)
- FCF(1,3) of $358
million or $1.30 per share
compared to $379 million or
$1.34 per share adjusted for one-time
PPA Termination Payments received in 2019
- Strong availability of 90.3 per cent compared to 90.0 per cent
for 2019
- Reduced our carbon emissions by 4.2 million tonnes representing
a 20 per cent reduction compared to 2019
- Returned $61 million of capital
to shareholders with the repurchase and cancellation of 7,352,600
common shares at an average price of $8.33 per share through our normal course issuer
bid (" NCIB") program
- Reached our target balance of $1.2
billion of senior corporate debt
- Increased the common share dividend by 6% to an annualized
dividend of 18 cents per share
Other Highlights & Updates
- Announced goal of carbon neutrality by 2050
- Added net 67 MW of wind generation through our acquisition of a
49 per cent equity investment in the Skookumchuck wind facility
- Completed first boiler conversion to gas for Sundance 6
- Achieved commercial operation of WindCharger, 10 MW battery
storage facility and Alberta's
first utility-scale energy storage facility
- Mining operations at Highvale mine to be discontinued by
Dec. 31, 2021 and will cease firing
with coal in Canada effective
Jan. 1, 2022
- Replaced existing power purchase agreement with BHP Billiton
Nickel West Pty. Ltd. ("BHP"), extending the term from Dec. 31, 2023 to Dec. 31,
2038
- Closed AU$800 million of secured financing from the South
Hedland Power Station ("TEC Offering")
- Received final tranche of investment by an affiliate of
Brookfield Asset Management of $400
million in preferred shares of the Company pursuant to the
Investment Agreement entered into on Mar.
22, 2019
- Together with our partner, Tidewater Midstream &
Infrastructure Ltd., entered into a Purchase and Sale Agreement
with ATCO Gas and Pipelines Ltd. ("ATCO") to sell the Pioneer
Pipeline for a purchase price of $255
million ($127.5 million net to
TransAlta). This agreement replaces the Company's previous
agreement from second quarter 2020, to sell its interest in the
Pioneer Pipeline to NOVA Gas Transmission Ltd. ("NGTL")
- The Company's Board adopted a Diversity and Inclusion Pledge
that commits the Company to advance diversity and inclusion in the
workplace. By undertaking this pledge, the Company will seek to
remove systemic barriers that may prevent diverse employees from
thriving, including visible minorities, Indigenous people, members
of the LGBTQ2S+ community, persons with disabilities, and
women
- Retired Centralia Unit 1 maintaining the Company's commitment
under Washington state's Energy
Transition Bill
- Announced the retirement of Dawn
Farrell, President and Chief Executive Officer by
Mar. 31, 2021 after leading the
Company for almost a decade. John
Kousinioris was appointed President and Chief Executive
Office to be effective Apr. 1,
2021
2021 Outlook
- Comparable EBITDA range of $960
million to $1,080 million, up
10 per cent from 2020 at the mid-point
- FCF range of $340 million to
$440 million, up 9 per cent from 2020
at the mid-point
- Sustaining capital range of $175
to $210 million
TransAlta Corporation ("TransAlta" or the "Company") (TSX: TA)
(NYSE: TAC) today reported its financial results for the fourth
quarter and full year ended Dec. 31,
2020.
"2020 was a pivotal year for TransAlta. Despite the challenges
of dealing with a pandemic, we delivered strong financial
performance and continued to execute on our Clean Energy Investment
Plan. We delivered our first gas conversion, Sundance 6, to market and are on track to
close our coal mine in Alberta by
end of 2021. Our greenhouse gas emissions (GHG) profile for 2020
reduced an additional 4.2 million tonnes compared to 2019, all told
we have achieved a 60 per cent reduction in GHG emissions since
2005 -- well beyond the expectations under the Paris Agreement. We
also deployed 77 MW of net wind and energy storage and we continued
to build TransAlta Renewables through the dropdowns we executed at
the end of the year.," said Dawn
Farrell, President and Chief Executive Officer. "The
leadership team under John
Kousinioris is well-positioned to deliver an even stronger
year in 2021."
"I am pleased to announce that TransAlta has adopted the
goal of achieving carbon neutrality by 2050. We are well into our
emissions reduction journey as a company and we feel our clean
electricity strategy is well aligned with a longer-term carbon
neutral goal. Setting this goal provides a meaningful internal
signal to our team as we execute our growth strategy but provides
flexibility over the coming decades. Adopting this goal also
sends a signal to our external stakeholders, including governments,
regarding our intention to contribute to broader national and
global efforts to meet national emissions reduction goals for
2050," said John Kousinioris, Chief
Operating Officer.
Below are additional highlights from the quarter on how
TransAlta is advancing its Clean Energy Investment Plan, how the
Company is managing COVID-19, as well as details regarding the
Company's liquidity and financial position and its objectives for
2021.
Significant Events and Other Updates
Clean Energy Investment Plan
Conversion to Gas
TransAlta's Clean Energy
Investment Plan includes converting three of our existing
Alberta thermal units to gas
during 2021 by replacing existing coal burners with natural gas
burners. The cost to convert each of TransAlta's wholly-owned units
is expected to be approximately $35
million per unit. On Feb. 1,
2021, we announced the completion of the conversion to gas
of Sundance Unit 6. The Company continues to advance conversion of
its Keephills Unit 2 and Keephills Unit 3 for completion later in
2021 and has issued Full Notice to Proceed for both units. In
addition, on Apr. 4, 2020, the
dual-fuel conversion of Sheerness Unit 2 was completed. The
Sheerness Unit 1 conversion to gas is in progress with expected
completion in the first quarter of 2021. The Sheerness facility
will discontinue firing coal by the end of 2021. The elimination of
coal as a fuel source will reduce future fuel costs and GHG costs
at Sheerness.
Sundance 5
Repowering
During the fourth quarter of 2020, an
equipment supply agreement was executed to repower Sundance Unit 5
into a highly efficient combined-cycle unit. Commercial
operation date is anticipated in the fourth quarter of 2023. The
Sundance 5 repowered
combined-cycle unit will have capacity of approximately 730 MW and
is expected to cost between $800
million to $825 million, well
below a greenfield combined-cycle project. The project has a
long-term PPA for capacity plus energy, including the passthrough
of GHG costs, starting in late 2023 with Shell Energy North America
(Canada), for a portion of the
plant capacity. The Company continues to evaluate the prospect for
repowering Keephills Unit 1 in 2021 and 2022 as a potential supply
addition to the Alberta market in
the 2026 to 2030 timeframe.
Windrise
Construction activities continue to
advance with all the appropriate procedures in place to protect the
construction team during COVID-19 pandemic. The commercial
operation date is expected to occur during the second half of 2021.
As at Dec. 31, 2020, the project was
78 per cent complete.
Skookumchuck
On Nov. 25, 2020, TransAlta completed the
acquisition of a 49 per cent equity interest in the Skookumchuck wind project ("Skookumchuck")
with Southern Power Company, a subsidiary of Southern Company.
Skookumchuck is a 136.8 MW wind
project located in Lewis and
Thurston counties near
Centralia in Washington state and consists of 38 Vestas
V136 wind turbines. The project began commercial operation on
Nov. 7, 2020, and has a 20-year power
purchase agreement with Puget Sound Energy. TransAlta's total net
capital investment was $86 million
(US$66 million) in cash, with an additional $77 million
(US$59 million) being funded with tax equity financing.
BHP Nickel West Contract Extension
Effective
Dec. 1, 2020, Southern Cross Energy
("SCE"), a subsidiary of the Company, and BHP replaced and extended
its current PPA, set to expire Dec. 31,
2023, to Dec. 31, 2038. The
PPA provides SCE with the exclusive right to supply thermal and
electrical energy for BHP's mining operations located in the
Goldfields region of Western
Australia. The extension will provide SCE a return on new
capital investments, which will be required to support BHP's future
power requirements and recently announced emission reduction
targets. The amendments within the PPA also provide BHP
participation rights in integrating renewable electricity
generation, including solar and wind, with energy storage
technologies, subject to the satisfaction of certain conditions.
Evaluation of renewable energy supply and carbon emissions
reduction initiatives under the extended PPA with SCE are underway,
including an 18.5 MW solar photovoltaic facility supported by a
battery energy storage system and a waste heat steam turbine
system.
Liquidity and Financial Position
The Company presently
has access to $2.1 billion in
liquidity, including $703 million in
cash. During 2020, we closed an AU$800 million TEC Offering and
also received the second and final tranche of the $750 million of strategic financing from
Brookfield. We repaid a
$400 million medium-term note due on
Nov. 25, 2020. Following the closings
of the recently announced drop-down transaction to TransAlta
Renewables, the Company will have achieved its target of
$1.2 billion of senior corporate
debt.
Achieved A- Score from CDP
In 2020, TransAlta improved
its scoring on the CDP Climate Change investor request. Our overall
score was an A-, indicating that we are implementing current best
practices. This ranks the Corporation among industry leaders on
climate change management and places us as ahead of most companies
in North America. The average CDP
score for our peers was a B and the average score for reporting
companies in North America was a
D.
COVID-19
In November
2020, as a result of rising COVID-19 case counts in the
Province of Alberta and in light
of office attendance restrictions eventually imposed by the
Government of Alberta, staff at
TransAlta's head office returned to remote work protocols. All of
TransAlta's offices and sites follow strict health screening and
social distancing protocols with personal protective equipment
readily available and in use. Further, TransAlta maintains travel
bans aligned to local jurisdictional guidance, enhanced cleaning
procedures, revised work schedules, contingent work teams and the
reorganization of processes and procedures to limit contact with
other employees and contractors on-site.
While our 2020 results have been impacted by price and demand
weakness as a result of COVID-19, all of our facilities continue to
remain fully operational and capable of meeting our customers'
needs. The Company continues to work and serve all of our customers
and counterparties under the terms of their contracts. We have not
experienced interruptions to service requirements. Electricity and
steam supply continue to remain a critical service requirement to
all of our customers and have been deemed an essential service in
our jurisdictions.
Full-Year 2020 Financial Results Summary
Comparable EBITDA(1,3) for the full year ended
Dec. 31, 2020, was $927 million, a decrease of $57
million compared to 2019. After adjusting for the one-time PPA
Termination Payment of $56 million
that was received in 2019 from the Balancing Pool, and the AESO
line loss adjustment of $8 million,
comparable EBITDA increased by $7
million compared to 2019. Comparable EBITDA increases were
driven by the Wind and Solar segment with the addition of the Big
Level, Antrim and Skookumchuck wind facilities and strong wind
resource across all regions, the Centralia segment due to increased benefits
from dispatch optimization and recovery from a significant loss
that was incurred in March 2019 from
an isolated and extreme pricing event due to an unplanned forced
outage, and a consecutive year of exceptional performance from the
Energy Marketing segment in both power and natural gas markets.
These gains were offset by a significant comparable EBITDA decline
in the Alberta Thermal segment. Alberta Thermal production declines
were the key contributor due to higher curtailments and dispatch
optimization as a consequence of reduced industrial demand in the
province and the impact of COVID-19 on demand generally.
Funds from operations ("FFO")(1,3) decreased two per
cent to $685 million for the full
year compared to $701 million in 2019
excluding PPA Termination Payments. Higher interest expense from
the additional tranche of Brookfield financing and the TEC Offering
financing was partially offset by realized foreign exchange gains
and reduced decommissioning activities resulting from COVID-19.
FCF(1) for the full year ended Dec. 31, 2020, was $358
million, a decrease of $77
million compared to $435 million
for 2019. After adjusting for the one-time PPA Termination Payment
of $56 million that was received in
2019 from the Balancing Pool, FCF decreased by $21 million
from $379 million or five per cent
compared to 2019. This was mostly driven by the FFO changes noted
above along with higher sustaining capital expenditures from
planned outages and final lease payments made on our mining
equipment, along with lower distributions to non-controlling
interests.
Net loss attributable to common shareholders for 2020 was
$336 million compared to earnings of
$52 million in 2019. Net loss
attributable to common shareholders has been impacted by higher
interest expense associated with the TEC Offering and the second
tranche of the Brookfield Investment, higher depreciation from
acceleration of the conversion to gas, gains recognized on the
Keephills 3 and Genesee 3 asset
swap that occurred in 2019, the one-time PPA Termination Payment of
$56 million in 2019 and further
impacts related to our decisions to accelerate our transition to
gas, including:
- Higher depreciation as we accelerate the closure of the
Highvale mine;
- Writedown of $37 million of coal
inventory;
- Onerous provision of $29 million
on the coal supply contract for Sheerness; and
- Impairment of $70 million
associated with the retirement of Sundance 3.
Fourth Quarter Financial Results Summary
Comparable EBITDA(1) for the three months ended
Dec. 31, 2020 was $234 million, a decrease of $9 million compared to the same period in 2019.
Comparable EBITDA decrease was mainly driven by non-recurring items
mostly impacting the Wind and Solar segment which include the
additional AESO line loss provisions recognized in 2020 and
insurance recoveries relating to tower fires received in 2019. The
declines were also contributed by the Alberta Thermal segment
mainly due to lower production driven by higher planned and
unplanned outages and increased fuel cost resulting from the
acceleration of the Highvale mine closing. These declines were
offset by growth in the Wind & Solar with the additions of Big
Level, Antrim and Skookumchuck wind facilities, and strong
resource production in all regions along with growth in the North
American Gas segments with the addition of the Ada cogeneration
facility.
FFO(1) for the three months ended Dec. 31, 2020, decreased by 15 per cent to
$161 million. Higher interest expense
from the additional tranche of Brookfield and the TEC Offering financings,
and higher non-cash items were partially offset by reduced
decommissioning activities resulting from COVID-19.
FCF(1) for the three months ended Dec. 31, 2020, was $52
million compared to $121
million for 2019. In addition to the reductions in FFO noted
above, the remaining changes in FCF was driven by higher sustaining
capital in quarter from the Sundance 6 planned outage, final settlement of
lease payments at Highvale mine and timing of distributions to
non-controlling interest partners.
Net loss attributable to common shareholders in the fourth
quarter of 2020 was $167 million
compared to net earnings of $66
million in the same period of 2019, a decrease of
$233 million. The net loss in 2020
was impacted by lower availability, which reduced revenues, the
additional coal inventory writedowns of $15 million from an
increased cost of coal and higher depreciation from the
acceleration of the Highvale mine closure of $8 million, the
onerous contract provision recognized on the coal contract for
Sheerness for $29 million and higher
interest expense associated with the TEC Offering and the second
tranche of the Brookfield Investment, partially offset by lower
asset impairments. The prior year benefited from the gain on the
termination of the Keephills 3
coal rights contract of $88 million
and the gain on the sale of Genesee 3 of $77 million.
2021 Outlook
The Company announced its 2021 outlook with comparable EBITDA
estimated to be between $960 to
$1,080 million. The midpoint of the
range represents a 10 per cent increase over 2020 results. The
Company expects comparable EBITDA to increase due to a number of
factors.
- We expect power to be offered, dispatched and optimized in a
more commercial manner in Alberta
with power prices more in line with longer-term historical averages
with the expiry of the remaining Alberta power purchase arrangements (the
"Alberta PPAs") at certain thermal facilities and transfer of
dispatch control away from the Balancing Pool and to the asset
owners. Power prices are also expected to be influenced by higher
carbon compliance costs and expected demand recovery relative to
the economy-wide closures from COVID-19 during most of 2020.
- Expiry of the Alberta PPAs at our Hydro facilities will step-up
comparable EBITDA driven by the removal of previous PPA obligation
payments (net of capacity payments).
- Full year contribution of the Skookumchuck wind facility and Ada
cogeneration facility.
- Windrise reaches commercial operations during the second half
of 2021.
The Company expects sustaining capital to be in the elevated
range of $175 million to $210 million, an increase to 2020 levels. This is
driven by a considerable number of planned outages in 2021, namely
the three outages in the Alberta Thermal fleet ($65 million to $75
million) to undertake the conversions to gas and other
turnaround maintenance. The Company presently has Sheerness 1 on
outage (carried out by our partner), and Keephills 2 outage is scheduled for an outage
in mid-March, and the Keephills 3
outage is planned for mid-September. Both Keephills 2 and Keephills 3 outages are each estimated to take
approximately 56 days.
FCF is expected to be between $340
million and $440 million. The
midpoint of the range represents a 9 per cent increase over 2020
results.
The following table provides additional details pertaining to
our 2021 outlook:
Measure
(CA$ millions
unless otherwise noted)
|
Target
|
Comparable
EBITDA
|
$960 to
$1,080
|
FCF
|
$340 to
$440
|
Range of key power price assumptions:
Market
|
Power Prices
($/MWh)
|
Alberta
Spot
|
$58 to $68
|
Mid-C Spot
(US$)
|
$25 to $35
|
Other assumptions relevant to 2021 financial outlook:
Sustaining
capital
|
$175 to
$210
|
|
|
Energy marketing
gross margin
|
$90 to
$110
|
2021 Objectives
In addition to meeting the financial
targets defined in the outlook, our efforts in 2021 will move us
closer to 100 per cent clean electricity by 2025. Our teams are
focused on the following:
- Successfully complete off coal transition strategy
- Lead in E2SG policy development
- Optimize our business in the Alberta merchant market
- Grow our customer-centric green power solutions business
- Advance and expand our renewables business
- Advance and expand our on-site generation business
- Maintain a strong financial position
- Maintain a robust COVID-19 response and recovery
2021+ E2SG & Sustainability Targets
The
Company has also established ambitious economic, environment,
social and governance ("E2SG") objectives. Our 2021
sustainability targets support the long-term success of our
business and highlight our future ESG value proposition.
Summary highlights of our 2021+ targets are outlined below and
further details can be found in our 2020 Annual Integrated
Report.
Environment
- We will discontinue coal power generation in Canada by the end of 2021 and we will have no
further coal generation by the end of 2025
- We will continue to develop new renewable projects that support
customer sustainability goals to achieve both long-term power price
affordability and carbon reductions
- By 2021, we will reduce our waste generation by 80 per cent
over 2019 levels
- By 2026, we will achieve a 95 per cent reduction of SO2
emissions, an 80 per cent reduction of NOx emissions below 2005
levels and reduce water consumption by 20 million m3 over 2015
levels
- By 2030, we will achieve company-wide GHG reductions of 60 per
cent below 2015 levels and by 2050, we will achieve carbon
neutrality
Social
- We are committed to achieving at least 40 per cent female
employment among all employees by 2030
- We have an ongoing commitment to maintain equal pay for women
in equivalent roles as men
- We continue to support equal access to all levels of education
for youth and Indigenous peoples through financial support and
employment opportunities
- We are committed to providing Indigenous cultural awareness
training to all TransAlta employees by the end of 2023
Governance
- We are committed to achieving 50 per cent female representation
on the Board by 2030
- We are committed to maintaining our position as a leader on
integrated E2SG disclosure
Comparable EBITDA
by Segment
(in CA$
millions)
|
3 Months
Ended
|
Year
Ended
|
Dec. 31,
2020
|
Dec. 31,
2019
|
Dec. 31,
2020
|
Dec. 31,
2019
|
Hydro
|
22
|
18
|
105
|
110
|
Wind and
Solar
|
77
|
80
|
248
|
231
|
North American
Gas
|
32
|
29
|
117
|
120
|
Australian
Gas
|
31
|
28
|
124
|
118
|
Alberta
Thermal(3)
|
41
|
55
|
162
|
263
|
Centralia
|
30
|
29
|
139
|
73
|
Energy
Marketing
|
23
|
26
|
113
|
89
|
Corporate
|
(22)
|
(22)
|
(81)
|
(76)
|
Total Comparable
EBITDA(1,3)
|
234
|
243
|
927
|
928
|
- Hydro: Comparable EBITDA for the year ended Dec. 31, 2020 decreased by $5 million compared to 2019 driven by lower
revenues driven by lower realized energy and ancillary prices in
the Alberta market which were
partially offset by higher water resources and a favourable
out-of-period transmission line loss recovery.
- Wind and Solar: Comparable EBITDA for the year ended
Dec. 31, 2020, increased by
$17 million compared to 2019,
primarily due to the full-year addition of the Big Level and
Antrim wind facilities and higher
production from strong wind resource across all regions, in
particular Alberta. This was
partially offset by an unfavourable out-of-period transmission line
loss settlement of $8 million from
the AESO in our Alberta fleet,
insurance proceeds that were received in 2019 of $10 million for tower fires, and planned expiry
of certain government power production incentives.
- North American Gas: Comparable EBITDA for the year ended
Dec. 31, 2020 decreased by
$3 million compared to 2019 mainly
due to lower earnings at Fort
Saskatchewan as the new commercial agreement was negatively
impacted by lower merchant pricing in Alberta partially offset by the addition of
the Ada cogeneration facility.
- Australian Gas: Comparable EBITDA for the year ended
Dec. 31, 2020 increased by
$6 million compared to 2019, due to
the deferral of legal costs associated with a contract dispute,
reduced staffing due to cost controls and the strengthening of the
Australian dollar against the Canadian dollar.
- Alberta Thermal: Excluding the PPA Termination Payments,
comparable EBITDA for the year ended Dec.
31, 2020 decreased $101
million compared to 2019. This largely reflects declines in
gross margin from reduced production due to curtailments and
dispatch optimization resulting from reduced industrial demand in
the province and the impact of COVID-19 on demand generally.
- Centralia: Comparable EBITDA
for the year ended Dec. 31, 2020,
increased by $66 million compared to
2019, primarily due to increased benefits from dispatch
optimization and a strengthened US dollar relative to the Canadian
dollar and as a result from an isolated and extreme pricing event
in March 2019 when Centralia was unable to commit one of its
units to physical production for day-ahead supply due to an
unplanned forced outage repair.
- Energy Marketing: Comparable EBITDA for the year ended
Dec. 31, 2020 increased by
$24 million compared to 2019 results.
Results were primarily from continued strong performance in both
power and natural gas markets. Gains were realized from short-term
strategies across various geographic regions aided by market and
price volatility. The Energy Marketing team was able to capitalize
on short-term arbitrage opportunities in the markets in which we
trade without materially changing the risk profile of the business
unit. OM&A spending for 2020 and 2019 was similar.
- Corporate: Our Corporate overhead costs for the year ended 2020
were $81 million, compared to
$76 million in 2019, with the
increase primarily due to realized gains and losses from the total
return swap. A portion of the settlement cost of our employee
share-based payment plans is fixed by entering into total return
swaps, which are cash settled every quarter. Excluding the impact
of the total return swap, Corporate overhead costs for 2020
decreased by $10 million compared to
2019, mainly due to lower legal fees and lower labour and reduced
travel costs, partially offset by additional costs to support
growth and development projects, centralization of shared services
to the Corporate segment and additional costs incurred to support
COVID-19 protocols.
Fourth Quarter and Year Ended 2020 Highlights
In CA$
millions, unless otherwise stated
|
3 Months
Ended
|
Year
Ended
|
Dec. 31,
2020
|
Dec. 31,
2019
|
Dec. 31,
2020
|
Dec. 31,
2019
|
Adjusted availability
(%)(2)
|
87.1
|
%
|
91.6
|
%
|
90.3
|
%
|
90
|
%
|
Production
(GWh)(2)
|
7,704
|
|
8,153
|
|
24,980
|
|
29,071
|
|
Revenues
|
544
|
|
609
|
|
2,101
|
|
2,347
|
|
Fuel, carbon
compliance and purchased power
|
327
|
|
286
|
|
968
|
|
1,086
|
|
Operations,
maintenance and administration
|
118
|
|
127
|
|
472
|
|
475
|
|
Net earnings (loss)
attributable to common shareholders
|
(167)
|
|
66
|
|
(336)
|
|
52
|
|
Cash flow from
operating activities
|
110
|
|
181
|
|
702
|
|
849
|
|
Comparable
EBITDA(1)
|
234
|
|
243
|
|
927
|
|
984
|
|
FFO(1)
|
161
|
|
189
|
|
685
|
|
757
|
|
FCF(1)
|
52
|
|
121
|
|
358
|
|
435
|
|
FCF - excluding the
PPA Termination Payments(1,3)
|
52
|
|
121
|
|
358
|
|
379
|
|
Net earnings (loss)
per share attributable to
common shareholders, basic and diluted
|
$
|
(0.61)
|
|
$
|
0.24
|
|
$
|
(1.22)
|
|
$
|
0.18
|
|
FFO per
share(1)
|
$
|
0.59
|
|
$
|
0.67
|
|
$
|
2.49
|
|
$
|
2.67
|
|
FCF per
share(1)
|
$
|
0.19
|
|
$
|
0.43
|
|
$
|
1.30
|
|
$
|
1.54
|
|
FCF per share -
excluding PPA Termination Payments(1,3)
|
$
|
0.19
|
|
$
|
0.43
|
|
$
|
1.30
|
|
$
|
1.34
|
|
Dividends declared
per common share(4)
|
$
|
0.09
|
|
$
|
0.04
|
|
$
|
0.22
|
|
$
|
0.12
|
|
Dividends declared
per preferred share(5)
|
$
|
0.50
|
|
$
|
0.26
|
|
$
|
1.27
|
|
$
|
0.78
|
|
TransAlta is in the process of filing its Annual Information
Form, Audited Consolidated Financial Statements and accompanying
notes, as well as the associated Management's Discussion &
Analysis ("MD&A"). These documents will be available today on
the Investors section of TransAlta's website at www.transalta.com
or through SEDAR at www.sedar.com.
TransAlta will also be filing its Form 40-F with the U.S.
Securities and Exchange Commission. The form will be available
through their website at www.sec.gov. Paper copies of all documents
are available to shareholders free of charge upon request.
Notes
(1) These items are not defined and
have no standardized meaning under IFRS. Presenting these items
from period to period provides management and investors with the
ability to evaluate earnings trends more readily in comparison with
prior periods' results. Please refer to the Discussion of
Consolidated Financial Results section of this MD&A for further
discussion of these items, including, where applicable,
reconciliations to measures calculated in accordance with IFRS. See
also the Additional IFRS measures and Non-IFRS Measures section of
this MD&A.
(2) Availability and production
includes all generating assets under generation operations that we
operate and finance leases and excludes hydro assets and equity
investments. Production includes all generating assets,
irrespective of investment vehicle and fuel type.
(3)
Excludes the $56 million PPA
Termination Payment received from the Balancing Pool for the early
termination of Sundance B and C PPAs received following the
successful outcome of the dispute with the Balancing Pool in the
third quarter of 2019 (the "PPA Termination
Payment").
(4) Dividends declared vary year over year due
to timing of declarations.
(5) Weighted average of the
Series A, B, C, E, and G preferred share dividends declared.
Dividends declared vary year over year due to timing of dividend
declarations.
Conference call
TransAlta will hold a conference call
and webcast at 9:00 a.m. MST
(11:00 a.m. EST) today, March 3, 2021, to discuss our fourth quarter and
full year 2020 results. The call will begin with a short address by
Dawn Farrell, President and CEO,
John Kousinioris, Chief Operating
Officer and Todd Stack, EVP Finance
and Chief Financial Officer, followed by a question and
answer period for investment analysts and investors. A question and
answer period for the media will immediately follow.
Dial-in numbers - Fourth Quarter and Full Year
2020 Results:
Toll-free North American participants call:
1-888-231-8191
A link to the live webcast will be available on the Investor
Centre section of TransAlta's website at
http://www.transalta.com/investors/events-and-presentations. If you
are unable to participate in the call, the instant replay is
accessible at 1-855-859-2056 (Canada and USA toll free) with TransAlta pass code
7436819 followed by the # sign. A transcript of the broadcast will
be posted on TransAlta's website once it becomes available.
About TransAlta Corporation:
TransAlta owns, operates and develops a diverse fleet of
electrical power generation assets in Canada, the United
States and Australia with a
focus on long-term shareholder value. TransAlta provides
municipalities, medium and large industries, businesses and utility
customers with clean, affordable, energy efficient and reliable
power. Today, TransAlta is one of Canada's largest producers of wind power and
Alberta's largest producer of
hydroelectric power. For over 100 years, TransAlta has been a
responsible operator and a proud community-member where its
employees work and live. TransAlta aligns its corporate goals with
the UN Sustainable Development Goals and has been recognized
by CDP (formerly Climate Disclosure Project) as an industry leader
on Climate Change Management, having recently achieved an A- score
from CDP.
For more information about TransAlta, visit our web site at
transalta.com.
Cautionary Statement Regarding Forward-Looking
Information
This news release contains
"forward-looking information", within the meaning of applicable
Canadian securities laws, and "forward-looking statements", within
the meaning of applicable United
States securities laws, including the United States Private
Securities Litigation Reform Act of 1995 (collectively referred to
herein as "forward-looking statements). In some cases,
forward-looking statements can be identified by terminology such as
"plans", "expects", "proposed", "will", "anticipates", "develop",
"continue", and similar expressions suggesting future events or
future performance. In particular, this news release contains,
without limitation, statements pertaining to: ceasing firing
with coal in Canada by the end of
2021; the closing of the sale of the Pioneer Pipeline to ATCO,
including the timing thereof; the Company delivering a stronger
year in 2021; the Sundance 5
Repowering, including the cost thereof and the timing for
commercial operation; the conversion of certain coal units to
natural gas and the timing and cost associated therewith; the
repowering of Keephills Unit 1; the Windrise wind project,
including the commercial operation date; emissions reduction
initiatives, including those being evaluated with BHP; the
Company's outlook for 2021, including 2021 comparable EBITDA
between $960 to $1,080 million, sustaining capital between
$175 million to $210 million, and FCF to be within the
$340 million to $440 million range; the Sheerness facility
discontinuing firing with coal by end of 2021; the Company's
objectives, including completing the Clean Energy Investment Plan,
advancing and expanding the renewable business, and maintaining a
strong financial position; expectations regarding Alberta market behavior in 2021; impact of
carbon compliance costs on power price; power demand recovery in
2021; timing of outages in 2021; and our ability to achieve our
sustainability targets. The forward-looking statements contained in
this news release are based on current expectations, estimates,
projections and assumptions, having regard to the Corporation's
experience and its perception of historical trends, and includes,
but is not limited to, expectations, estimates, projections and
assumptions relating to: energy marketing achieving gross margin of
$90 million to $110 million; Alberta spot pricing being $58/MWh to $68/MWh;
Mid-C pricing be $25/MWh to
$35/MWh; power prices to be
influenced due to higher carbon compliance costs and expected
demand recovery relative to the economy-wide closures from COVID-19
during most of 2020; and Windrise achieving commercial operation in
the second half of 2021. These forward-looking statements are
not historical facts but are based on TransAlta's belief and
assumptions based on information available at the time the
assumptions were made, including, but not limited to, the current
political and regulatory environment, the price of power in
Alberta and the condition of the
financial markets. These statements are subject to a number of
risks and uncertainties that may cause actual results to differ
materially from those contemplated by the forward-looking
statements. Some of the factors that could cause such differences
include: operational risks involving our facilities; changes in
market prices where we operate; unplanned outages at generating
facilities and the capital investments required; equipment failure
and our ability to carry out repairs in a cost effective and timely
manner; the effects of weather, catastrophes and public health
crises; disruptions in the source of thermal fuels, water, solar or
wind required to operate our facilities, including the necessary
natural gas supply to support the conversion of the coal units;
energy trading risks; failure to obtain necessary regulatory
approvals in a timely fashion, or at all; negative impact to our
credit ratings; legislative or regulatory developments and their
impacts; increasingly stringent environmental requirements and
their impacts; increased competition; global capital markets
activity (including our ability to access financing at a reasonable
cost); changes in prevailing interest rates; currency exchange
rates; inflation levels and commodity prices; general economic
conditions in the geographic areas where TransAlta operates;
disputes or claims involving TransAlta or TransAlta Renewables,
including those pertaining to the Brookfield investment and the commissioning of
South Hedland; and other risks and uncertainties discussed in the
Company's materials filed with the securities regulatory
authorities from time to time and as also set forth in the
Company's MD&A and Annual Information Form for the year ended
December 31, 2020. Readers are
cautioned not to place undue reliance on these forward-looking
statements, which reflect TransAlta's expectations only as of the
date of this news release. The purpose of the financial outlooks
contained in this news release are to give the reader information
about management's current expectations and plans and readers are
cautioned that such information may not be appropriate for other
purposes and is given as of the date of this news release.
TransAlta disclaims any intention or obligation to update or revise
these forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
law.
Note: All financial figures are in Canadian dollars unless
otherwise indicated.
View original
content:http://www.prnewswire.com/news-releases/transalta-reports-fourth-quarter-and-full-year-2020-results-provides-2021-outlook-and-announces-carbon-neutrality-by-2050-301239619.html
SOURCE TransAlta Corporation