TransAlta Reports Strong Third Quarter 2024 Results

Financial Performance - The company reported strong financial performance for Q3 2024, with Free Cash Flow (FCF) per share of $0.47, driven by proactive hedging and asset management strategies [1][4] - Adjusted EBITDA for Q3 2024 was $325 million, a decrease of 28% compared to $453 million in Q3 2023, primarily due to lower power prices and production in the Hydro and Gas segments [4][13][15] - FCF for Q3 2024 was $140 million, down 39% from $228 million in Q3 2023, mainly due to lower adjusted EBITDA and higher income tax expenses [4][17] - Operational adjusted availability improved to 94.5% in Q3 2024, up from 91.9% in Q3 2023, driven by new asset additions and the return of Kent Hills wind facilities [4][14] Business Developments - The company is advancing the acquisition of Heartland Generation, with ongoing discussions with Energy Capital Partners and regulatory approval from the Competition Bureau [3][5] - Sundance Unit 6 will be temporarily mothballed from April 1, 2025, for up to two years, with flexibility to return to service based on market conditions [3][6] - The company is pursuing opportunities to support the energy transition, including redevelopment and recontracting of legacy thermal assets [3] Shareholder Returns - The company returned $114 million to shareholders through share buybacks in the first nine months of 2024, repurchasing 11.8 million shares at an average price of $9.65 per share [4][9] - The enhanced share repurchase program for 2024 targets up to $150 million, with 76% of the program already completed [4][7] Operational Highlights - Production for Q3 2024 increased by 1% to 5,712 GWh compared to 5,678 GWh in Q3 2023, driven by higher output from the Wind and Solar segment [13] - The Wind and Solar segment saw a 19% increase in adjusted EBITDA to $44 million in Q3 2024, driven by new asset additions and the return of Kent Hills wind facilities [15] - The Gas segment's adjusted EBITDA decreased by 45% to $139 million in Q3 2024, primarily due to lower production and market prices in Alberta [15] Financial Guidance - The company expects 2024 Adjusted EBITDA to be between $1,150 million and $1,300 million, with FCF projected between $450 million and $600 million [4][23] - Alberta spot power prices are expected to range between $60 and $75 per MWh for the remainder of 2024, down from previous assumptions of $75 to $95 per MWh [25] Liquidity and Hedging - The company had $1.8 billion in liquidity as of September 30, 2024, including $401 million in cash [22] - Hedged volumes for Q4 2024 are 2,415 GWh at an average price of $82 per MWh, with hedged gas volumes of 15 million GJ at $2.55 per GJ [27]