TransAlta Renewables Reports First Quarter 2015 Results
CALGARY, Alberta (May 1, 2015) – TransAlta Renewables Inc. (“TransAlta Renewables” or the “Company”) (TSX: RNW) today reported first quarter comparable EBITDA(1) of $53.8 million and FFO(1) of $44.6 million. Comparable EBITDA and FFO both decreased $1.8 million in the quarter compared to the same period last year, primarily due to lower and closer to normal wind volumes in Eastern Canada and Wyoming. Net Earnings for the first quarter were $19.7 million, or $0.17 per share.
“TransAlta Renewables delivered strong performance in the first quarter of 2015 in line with our expectations, said Brett Gellner, President. “In addition, the recently announced investment by the Company in TransAlta’s Australian portfolio will significantly increase the Company’s scale and cash flow diversification, and allow us to increase the dividend by $0.07 per share, or 9%, once the transaction closes and an expected 6-7% increase once the South Hedland project is fully commissioned in 2017. TransAlta Renewables has demonstrated its commitment to grow and create value for shareholders and we believe the Company continues to be well positioned to pursue additional investment opportunities with its sponsor and majority owner, TransAlta, as well as third party acquisitions.”
On March 23, 2015, the Company entered into an investment agreement with TransAlta Corporation (“TransAlta”) pursuant to which TransAlta Renewables agreed to acquire an economic interest based on TransAlta’s Australian power generation portfolio and Fortescue River gas pipeline (the “Portfolio”) and fund the remaining project costs for the South Hedland gas-fired project, for a combined value of approximately $1.78 billion (the “Transaction”). The Portfolio consists of 575 MW of power generation from six operating assets and the South Hedland project currently under construction, as well as the recently commissioned 270 km gas pipeline. Closing is expected in May 2015 and is subject to shareholder approvals. Approval from the Australian Federal Investment Review Board has already been received. The Transaction is expected to provide mid-teen percent accretion to the Company’s cash available for distribution per share(1) upon closing.
Summary of Results
Q1 2015 compared to Q1 2014
• Comparable EBITDA of $53.8 million compared to $55.7 million for the same period last year
• Funds from operations of $44.6 million compared to$46.4 million for the same period last year
• Production(2) of 958 GWh, compared to 981 GWh for the same period last year
(1) Comparable EBITDA refers to Earnings before interest, taxes, depreciation and amortization and adjusted for certain other items. FFO refers to Funds from Operations. Free Cash Flow refers to Funds from Operations less sustaining capital, preferred dividends and non-controlling interest payments. Cash available for distribution represents the amount the cash generated from operations by our business, before changes in working capital and after sustaining and productivity capital, distributions to non-controlling interest and scheduled principal repayments of debts. Comparable EBITDA, funds from operations, cash available for distribution, comparable earnings, comparable earnings per share, funds from operations per share and cash available for distribution per share are not defined under International Financial Reporting Standards (“IFRS”). Presenting these measures from period to period provides supplemental information to help management and shareholders evaluate earnings’ and cash flow trends in comparison with prior periods’ results. Refer to the Non-IFRS Measures section of the Management’s Discussion and Analysis (“MD&A”) for the quarter for further discussion of these items.
(2) Includes production from our economic interest in the Wyoming Wind Farm.
The following table depicts key financial results and statistical operating data:
First Quarter 2015 Highlights
In $CAD thousands, unless otherwise stated
March 31, 2015
March 31, 2014
|Net earnings attributable to common shareholders||19,650||21,134|
|Funds from Operations||44,599||46,354|
|Cash flow from operating activities||41,083||45,210|
|Cash available for distribution||30,283||16,835|
|Net earnings per share attributable to common shareholders, basic and diluted||0.17||0.18|
|Comparable earnings per share||0.17||0.18|
|Funds from operations per share||0.39||0.40|
|Cash available for distribution per share||0.26||0.15|
|Dividends paid per common share||0.19||0.19|
A complete copy of TransAlta Renewables’ first quarter report including MD&A and unaudited financial statements is available through TransAlta Renewables’ website at www.transaltarenewables.com or through SEDAR at www.sedar.com.
TransAlta Renewables Annual Meeting of Shareholders
TransAlta Renewables will hold its Annual Meeting of Shareholders later this morning at 10:00 a.m. MT (12:00 p.m. ET) at the Hotel Arts – Spectrum 2 Ballroom, Calgary, Alberta. The Annual Meeting of Shareholders will be broadcast via webcast and conference call. To access the broadcast, please visit /investors/events-and-presentations or use the dial-in information provided below.
Canada & USA call: 1-866-740-1260 (Code 8626500#)
Special Meeting of Shareholders
The Company will hold a Special Meeting of Shareholders, which will take place on May 7, 2015 at 10:00 a.m. MT in the Spectrum 3 Ballroom at Hotel Arts, located at 119 12 Avenue S.W., in Calgary, Alberta for the purpose of considering, and if deemed advisable, approving the Australian Transaction.
This news release does not constitute an offer to sell or a solicitation of an offer to buy the Subscription Receipts in any jurisdiction.
About TransAlta Renewables Inc.
TransAlta Renewables owns 29 wind and hydroelectric power generation facilities, including our economic interest in Wyoming Wind, having an aggregate installed generating capacity of 1,376 MW, in which it holds a net ownership interest of approximately 1,255 MW. TransAlta Renewables’ power generating capacity is among the largest of any publicly-traded renewable independent power producer (“IPP”) in Canada, with more wind power generating capacity than any other Canadian publicly-traded IPP. TransAlta Renewables’ strategy is focused on the efficient operation of its portfolio of assets and expanding its asset base through the acquisition of high-quality contracted renewable and natural gas power generation facilities and other infrastructure assets. Our objectives are to (i) create stable, consistent returns for investors through the ownership of contracted renewable and, potentially, natural gas power generation and other infrastructure assets that provide stable cash flow through long-term contracts with creditworthy counterparties, including TransAlta; (ii) pursue and capitalize on strategic growth opportunities in the renewable and, potentially, natural gas power generation and other infrastructure sectors; and (iii) pay out a portion of cash available for distribution to the shareholders of the Corporation on a monthly basis.
Cautionary Statement Regarding Forward Looking Information
This news release may contain forward looking statements, including statements regarding the business and anticipated financial performance of the Company. These forward-looking statements are not historical facts but reflect the Company’s current expectations concerning future plans, actions and results. These statements are subject to a number of risks and uncertainties that could cause actual plans, actions and results to differ materially from current expectations including, but not limited to, changes in tax, environmental, and other laws and regulations; competitive factors in the renewable power industry; operational breakdowns, failures, or other disruptions; changes in economic and market conditions; expectations regarding the Transaction (as defined herein), including the satisfaction of conditions and approvals, receipt of shareholder approvals and regulatory approvals necessary to complete the Transaction; the effect, results and perceived benefits of the Transaction, including forecasts of CAFD and expected CAFD per share accretion, the increase to the dividend following closing of the Transaction and the expected increase to the dividend following the South Hedland project being fully commissioned; the net proceeds of the offering of subscription receipts made in connection with the Transaction and anticipated use thereof; the timing and completion and commissioning of projects under development, including the South Hedland project and the costs thereof; and other risks and uncertainties discussed in the Company’s materials filed with the Canadian securities regulatory authorities from time to time and as also set forth in the Company’s MD&A and 2015 Annual Information Form for the year ended Dec. 31, 2014. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect the Company’s expectations only as of the date of this news release. The Company 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 noted otherwise.
For more information:
Director, Corporate Finance and Investor Relations
Phone: 1 800-387-3598 in Canada and U.S.
Manager, Investor Relations
Phone: 1-800-387-3598 in Canada and U.S.
Manager, External Communications
Toll-free media number: 1-855-255-9184
Alternate local number: 403-267-2540
LAST: CAD$14.280 (+1.301%)
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