Transalta Corporation · TSX:TA
Transalta — Investor Presentation (May 2003)
15 slides from Transalta's investor presentation, May 12, 2003
Slide 1: May 2003 Investor Update
May 2003 Investor Update May 12, 2003
Slide 2: Forward looking statements
forward looking statements This presentation may contain forward-looking statements, including statements regarding the business and anticipated financial performance of TransAlta Corporation. These statements are subject to a number of risks and uncertainties that may cause actual results to differ
Slide 3: Agenda
agenda • Who we are • Industry opportunity • Business strategy • Risk mitigation • Energy Marketing • Financial
Slide 4: Who we are
who we are • Canada’s largest non-regulated electric generation and wholesale marketing company • Operations in Canada, United States, Mexico, Australia • Close to $9 billion in assets • 10,000 MW generating capacity • 85% of generation capacity currently contracted • Strong credit ratings
Slide 5: Industry opportunity
industry opportunity • Essential service • Steady growth – 75% of GDP • Large industry • Regional markets • Low risk • Strong cash flows
Slide 6: Business strategy
business strategy Mainta Discip lined Run Strong in anage ts M Growt h Asse tly Balanc Asse t n Efficie Sheet e Risk Continuity
Slide 7: Disciplined growth – CE Generation LLC
disciplined growth – CE Generation LLC • 50 / 50 partnership with MidAmerican – 816 MW • US$205 million + working capital • $0.05 EPS in 2003; growth beyond 2003 • Annual US$20-25 million cash distribution to TA • Fits with strategy – financial, risk mitigation, partnership
Slide 8: Disciplined growth – Genesee 3
disciplined growth – Genesee 3 • 50 / 50 partnership with EPCOR – 450 MW • $395 million (2003 – 2005) • Merchant capacity – low cost fuel • Supercritical combustion technology • EPCOR / Fording coal reserves • Offsets Wabamun • Partnership includes Keephills and Sarnia
Slide 9: Run assets efficiently
run assets efficiently Q1 Year 2003 2002 2002 2001 Availability % 93.4 92.5 88.4 86.9 • Reduced forced outages at Centralia • Alberta thermal program in Q4 proved beneficial • Gas plants continue to hit targets Maintenance plan • Increase availability • Become market responsive • Reduce $/MW (operat
Slide 10: Maintain strong balance sheet
maintain strong balance sheet • Equity offering • 17.25 million shares • $16.00 per share • Well received by financial community
Slide 11: Manage asset risk - risk mitigation strategy
manage asset risk - risk mitigation strategy Capacity by geography Capacity by fuel type (%) (%) 8 12 22 26 62 70 Canada Coal U.S. Gas Mexico Hydro and Renewables
Slide 12: Risk mitigation – Energy Marketing
risk mitigation – Energy Marketing Asset Maximize Plant Positioning Output Trading • Growth through • Short-term • Physical versus market opportunities financial knowledge • Leverage market • Tight controls; • Direct positions restricted V@R development and acquisition efforts to markets
Slide 13: Financial strategy
financial strategy Strong Credit Strong Share Rating Price Maintain Dividend
Slide 14: Quarterly results
quarterly results ($ millions) Quarter ended Mar. 31 2003 Change Revenues $ 616 +47% Net earnings $ 49 +14% EPS ($) $ 0.28 +12% Cash flow from operating activities $ 170 +32%
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