Slide 1: Q4/13 Analyst Conference Call
CAPITAL POWER Q4/13 Analyst Conference Call March 3, 2014 Brian Vaasjo, President & CEO Stuart Lee, SVP Finance & CFO
Slide 2: Forward-looking information
Forward-looking information Cautionary statement Certain information in this presentation and in responses to questions contains forward-looking information. Actual results could differ materially from conclusions, forecasts or projections in the forward-looking information, and certain material fac
Slide 3: Non-GAAP financial measures
Non-GAAP financial measures The Company uses (i) earnings before finance expense, income tax expense, depreciation and amortization, impairments, foreign exchange gains or losses, and gains on disposals (adjusted EBITDA), (ii) funds from operations, (iii) cash flow per share, (iv) discretionary cash
Slide 4: Corporate updates
Corporate updates Completed sale of North East U.S. assets to Emera Transaction completed Nov/13 for net proceeds of $568M With the refocusing of merchant power business in Alberta and other corporate efficiencies, expect annual cost savings of $25M-$30M ($22M in G&A) Port Dover & Nanticoke wind
Slide 5: Corporate updates (cont'd)
Corporate updates (cont’d) Partnering with ENMAX on Genesee 4 & 5 facilities In Dec/13, announced letter of intent with ENMAX to pursue joint arrangement agreements to develop, construct, own and operate the Genesee 4 & 5 facilities Definitive agreements with ENMAX on track for completion in Q1/
Slide 6: Q4/13 Operating performance
Q4/13 Operating performance Plant availability Q4/13 Q4/12 Alberta commercial plants Genesee 3 Keephills 3 98% 99% 56% 100% Strong fleet availability of 93% in Q4/13 Clover Bar 91% 98% Joffre 85% 65% Three contracted plant Halkirk 99% 95% segments (AB, ON & BC, Alberta contracted Genesee 1 100%
Slide 7: Financial review
Financial review Sale of New England assets With transaction finalized in Q4/13, received $568M in net proceeds Recorded a pre-tax gain of $76M on the sale primarily consisting of accumulated F/X translation gains Number of small items impacting Q4/13 G&A expense ~$8M in corporate costs relati
Slide 8: Financial performance – Q4/13
Financial performance – Q4/13 $M, except per share amounts Q4/13 Q4/12 Change Revenues $327 $288 14% Adjusted EBITDA (before mark-to-market)(1) $102 $100 2% Basic earnings per share $0.89 $0.19 368% Normalized earnings per share $0.35 $0.23 52% Funds from operations $109 $83 31% Cash flow per share
Slide 9: Financial performance – 2013
Financial performance – 2013 $M, except per share amounts 2013 2012 Change Revenues $1,393 $1,296 7% Adjusted EBITDA (before mark-to-market)(1) $483 $456 6% Basic earnings per share $2.13 $0.84 154% Normalized earnings per share $1.69 $1.29 31% Funds from operations $419 $381 10% Cash flow per share
Slide 10: Continued strong cash flow generation
Continued strong cash flow generation Funds from operations (FFO) $450 2014 FFO target range of $360M- $400M is lower than 2013 due to $400 35% lower average AB power price $350 34% ~39% forecast 35% $300 Generating significant discretionary cash flow(2) with 3-year average of $250 19% ($M) 39%
Slide 11: 2014 Financial outlook
2014 Financial outlook Expect FFO in 2014 to be lower than 2013 based on an average Alberta power price forecast of $57/MWh for 2014 Expect lower realized prices on unhedged position, profitability from Clover Bar peaking facility, and incentive revenues from Genesee 1 & 2 Partially offset by a
Slide 12: 2013 Performance & 2014 targets
2013 Performance & 2014 targets Operational targets 2013 Target Results 2014 Target Plant availability average ≥ 93% 93% ≥ 95% Sustaining capex ≤ $105M $79M(1) $85M Maintenance & operating expenses $225M - $245M(2) $192M(2) $165M - $185M 1) Certain sustaining capex incurred for Northeast US assets n
Slide 13: 2013 Performance & 2014 targets (cont'd)
2013 Performance & 2014 targets (cont’d) Development and construction targets 2013 Target Results 2014 Target Port Dover & Continue on budget Achieved COD in - Nanticoke Wind $340M, Q4/13 target Nov/13 with final COD costs estimated at ~$300M K2 Ontario Wind Environmental Environmental Commence appr
Slide 14: 2013 Performance & 2014 target (cont'd)
2013 Performance & 2014 target (cont’d) Financial targets 2013 Target Results 2014 Target (based on $58/MWh (actual AB power (based on $57/MWh AB power price) price of $80/MWh) AB power price) Normalized EPS $1.20 - $1.40 $1.69 - Funds from operations $385M - $415M $419M $360M - $400M Cash flow per
Slide 15: Questions?
QUESTIONS?
Slide 16: Forward-looking information
Forward-looking information Forward-looking information or statements included in this presentation are provided to inform the Company’s shareholders and potential investors about management’s assessment of Capital Power’s future plans and operations. This information may not be appropriate for othe
Slide 17: Investor Relations Contact
Investor Relations Contact Randy Mah Senior Manager (780) 392-5305 rmah@capitalpower.com Head Office 10th Floor 10423 – 101 Street NW Edmonton, AB T5H 0E9 www.capitalpower.com