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Capital Power 'met or exceeded' operating, financial targets in 2017, CEO says

Capital Power Corp. on Feb. 16 posted fourth-quarter 2017 adjusted EBITDA of C$154 million, up from C$144 million for the comparable quarter of 2016.

Fourth-quarter adjusted funds from operations totaled C$91 million in 2017, compared with C$56 million 2016, while revenues and other income dropped to C$261 million, from C$280 million. Net cash flows from operating activities were C$75 million for the most recent quarter, compared with C$69 million a year earlier.

Capital Power booked C$25 million, or 24 cents per share, in fourth-quarter 2017 normalized earnings attributable to common shareholders, compared with C$26 million, or 27 cents per share, for the same quarter of 2016.

The company posted a net loss attributable to shareholders of C$10 million, or a loss of 20 cents per share, during the fourth quarter of 2017, compared with net income of C$28 million, or 21 cents per share, for the corresponding period of 2016.

Adjusted EBITDA for the full year rose to C$551 million, from C$520 million in 2016, while adjusted funds from operations totaled C$363 million in 2017, compared with C$307 million in the prior year.

Revenues and other income for the year totaled C$1.15 billion, compared with C$1.21 billion. Net cash flows from operating activities were C$372 million in 2017, compared with C$375 million a year ago.

The company recorded 2017 normalized earnings attributable to common shareholders of C$113 million, or C$1.12 per share, compared with C$117 million, or C$1.22 per share, for 2016.

Net income attributable to shareholders rose to C$144 million, or C$1.07 per share, for 2017, compared with C$111 million, or 91 cents per share, a year ago.

"In 2017, Capital Power met or exceeded its annual operating and financial targets while significantly exceeding expectations on delivering on its strategy of increasing cash flow from contracted assets," said Brian Vaasjo, president and CEO of Capital Power.

The company's owned facilities achieved an availability average of 96% that exceeded the 95% target, Vaasjo added.

Looking ahead, Capital Power said it is "well-positioned" to benefit from the step change increase and higher volatility in Alberta power prices, which averaged C$22/MWh in 2017. Average forward prices for 2018 are in the mid-C$50/MWh due to the decommissioning and mothballing of older coal units, higher carbon taxes, and robust demand growth.

The company expects adjusted funds from operations for 2018 to be above the midpoint of the guidance range of C$360 million to C$400 million.