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TransAlta
TransAlta Reports Fourth Quarter and Full Year 2016 Results



March 6, 2017

TransAlta Corporation ("TransAlta" or the "Company") (TSX: TA; NYSE: TAC) reported its fourth quarter and full year 2016 financial results.  Comparable EBITDA(1) for the fourth quarter 2016 was $374 million compared to $268 million during the same period last year. Comparable FFO(1) for the quarter was $228 million, or $0.79 per share, compared to $243 million, or $0.86 per share, during the same period last year. The Keephills 1 Force Majeure (the "K1 FM") adjustments to our provisions had no impact on FFO.  

Comparable EBITDA for the full year ending December 31, 2016 totaled $1,145 million, an increase of $200 million compared to 2015. Comparable FFO for the full year ending December 31, 2016 was $763 million compared to $740 million in 2015 and in-line with the guidance range for the year of $755 to $835 million.  

Improved results in 2016 are a result of full year contributions from renewable assets acquired in the second half of 2015, solid performance from our gas and renewable portfolios, cost reduction initiatives across the fleet implemented in 2015, and the reversal of our provision relating to the K1 FM in 2013. Our highly contracted profile and hedging strategy mitigated the impact of lower prices during the year in Alberta; however, unfavourable market conditions in the Pacific Northwest negatively impacted the contribution from our US coal segment.

"We landed a solid year despite record low power prices in Alberta and the Pacific Northwest," said Dawn Farrell, President and Chief Executive Officer. "Highlights for year include landing the coal transition agreement, meeting our 2016 guidance, and furthering the repositioning of our capital structure," commented Mrs. Farrell.

As at December 31, 2016, total debt, net of cash, totaled $4.1 billion compared to $4.4 billion at December 31, 2015. The decrease is primarily due to debt paid down using the proceeds received from the sale to TransAlta Renewables of economic interests in the Canadian Assets (as defined below) completed in January 2016, free cash flows generated by the business, and the strengthening of the Canadian dollar. Over the next four years, we have approximately $2.2 billion of recourse and non-recourse debt maturing. We expect to refinance some of these upcoming debt maturities over the next 18-months by raising $700 million to $900 million of debt secured by our contracted cash flows. We have access to approximately $1.7 billion in liquidity at the end of the year and we expect to continue our de-leveraging strategy with a portion of our free cash flow over the next four years being allocated to debt reduction.

Comparable net earnings attributable to common shareholders for the full year ending December 31, 2016 was $34 million ($0.12 net earnings per share) compared to comparable net loss of $48 million ($0.17 net loss per share) in 2015. The year-over-year improvements primarily relate to contributions from assets we acquired last year, solid performance from the renewable asset portfolio, cost reduction initiatives and the reversal of our provision for the K1 FM. Reported net earnings attributable to common shareholders was $117 million ($0.41 net earnings per share) compared to net loss of $24 million ($0.09 net loss per share) in 2015. Comparable net earnings and reported net earnings for the three months ending December 31, 2016 were $53 million and $61 million, respectively as compared to $3 million and a net loss $7 million in same period in 2015.

Click here to read the full press release.

For more information:

Organization:
TransAlta Corporation
Address:
110 Twelfth Ave SW
Calgary, Alberta
Canada, T2P 2M1
www.transalta.com
Tel: 403-267-7110


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