Slide 1: TransAlta Corporation Third Quarter 2018 Results
TransAlta Corporation Third Quarter 2018 Results Wednesday, October 31, 2018 1
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation includes forward-looking statements or information (collectively referred to herein as “forward-looking statements”) within the meaning of applicable securities legislation. All forward-looking statements are based on our beliefs as well as assumptions ba
Slide 3: Agenda
Agenda Third Quarter and YTD 2018 Highlights Segmented Cash Flows Diversified Generation Base Strong Growth in Free Cash Flow Alberta Power Prices and Canadian Coal Margins Capital Allocation Transformation and Strategic Focus Questions and Answers 3
Slide 4: Third Quarter and YTD 2018 Highlights
Third Quarter and YTD 2018 Highlights 3 Months Ended 9 Months Ended September 30 September 30 (in $CAD millions) 2018 2017 2018 2017 Comparable EBITDA(1) $249 $245 $890 $787 FFO(1) $204 $196 $710 $585 FCF(1) $94 $101 $426 $227 Adjusted Availability(2) 93.7% 86.5% 91.3% 86.3% • Consistent results com
Slide 5: Segmented Cash Flows
Segmented Cash Flows Q3 2018 SEGMENTED CASH FLOWS Strong segmented cash flows due to improved power prices and lower sustaining capital NINE MONTHS 2018 SEGMENTED CASH FLOWS 5
Slide 6: Diversified Generation Base
Diversified Generation Base Over 70 facilities in Canada, the US and Australia Diversified portfolio provides strong and stable cash flows NINE MONTHS 2018 SEGMENTED CASH FLOWS (1) Hydro 13% Wind and Solar 22% Energy and Marketing 3% Canadian Coal 16% Aus Gas 14% US Coal 6% Canadian Gas 26% (1)
Slide 7: Strong Growth in Free Cash Flow
Strong Growth in Free Cash Flow Strong hydro results due to increase in power and ancillary prices Higher EBITDA margins in Canadian Coal Lower interest expense and capital requirements NINE MONTHS 2018 FCF 7
Slide 8: Alberta Power Prices and Canadian Coal Margins
Alberta Power Prices and Canadian Coal Margins ALBERTA POWER PRICE $150 $125 $100 $/MWh $75 October 2019 Average $50 ~$56/MWh September $25 $0 Jan 2013 Jan 2014 Jan 2015 Jan 2016 Jan 2017 Jan 2018 Jan 2019 CANADIAN COAL EBITDA MARGIN(1) $25 $23.13 $20 $17.73 $14.69 $15.26 $/MWh $15 $10 $5 $0 2017 20
Slide 9: Capital Allocation
Capital Allocation Achieved Target Pay $400 million debt expiring in Reduced total consolidated net 2020 using FCF Debt debt by $1.2 billion or 28% since Pay approximately $175 million Reduction 2015 in amortizing debt between now and the end of 2020. Purchased and cancelled Share Buy 1,907,
Slide 10: Transformation and Strategic Focus
Transformation and Strategic Focus Optimize the cash flows from our diversified portfolio Generate stable Maximize co-firing to reduce fuel and carbon costs and growing cash Position the assets to be competitive for the upcoming flows in Alberta capacity market Transition to a clean power co
Slide 11: Question and Answer
Question and Answer ¥ « Tra nsAl ta pachiiner