Capital Power Corporation · TSX:CPX
Capital Power — Merger or Acquisition (April 2025)
23 slides from Capital Power's merger presentation, Apr 14, 2025
Slide 1: ~$3.0B PJM Acquisition
~$3.0B PJM Acquisition Positioned to capture multi-faceted growth in North America’s largest power market. April 14, 2025 Acquisition of Hummel and Rolling Hills A final base shelf prospectus of Capital Power Corporation (and its subsidiaries, “Capital Power”, the “Company”, "CPX", “we”, “us” or “ou
Slide 2: Territorial Acknowledgement
Territorial Acknowledgement In the spirit of reconciliation, Capital Power respectfully acknowledges that we operate within the ancestral homelands, traditional and treaty territories of the Indigenous Peoples of Turtle Island, or North America. Capital Power’s head office is located within the trad
Slide 3: Agenda
Agenda 1. Transaction Details | Avik Dey - President & CEO 2. Financial Overview | Sandra Haskins - SVP, Finance & CFO 3. Closing Remarks | Avik Dey - President & CEO Sandra Haskins SVP, Finance & CFO Avik Dey President & CEO 3
Slide 4: ~$3.0B acquisition of two natural gas-fired facilities in PJM
~$3.0B acquisition of Asset Overview two natural gas-fired Hummel Rolling Hills facilities in PJM Location Pennsylvania Ohio • Establishes a presence in PJM1, the largest and most liquid North American (N.A.) power market (~200GW2 of installed capacity) Region PJM-MAAC5 PJM-RTO6 • Expands U.S. fleet
Slide 5: Execution of growth strategy enhances shareholder value
Execution of growth strategy enhances shareholder value Flexible Generation1 and Renewables Contract Asset Optimization Acquire Develop Optimization & Expansion Targeted Annual Total Shareholder Return of 12-14% 1. Flexible Generation is defined as natural gas generation assets and energy storage bu
Slide 6: Major U.S. expansion expected to provide strong accretion, increased scale and diversification
Major U.S. expansion expected to provide strong accretion, increased scale and diversification Enhanced PJM High Quality Financial Merit Institutional Scale Market Assets Validation Positions Capital Power Large and liquid Consistent with Expected to be accretive as one of five N.A. market with grow
Slide 7: Positions CPX as IPP with >10GW natural gas capacity
Enhanced Scale Positions CPX as IPP with >10GW natural gas capacity Top 10 North American Independent Power Producers1 Net Natural Gas Capacity Only (GW) 2 Constellation Energy 27.5 Avg. of U.S. Peers6 CPX Pro Forma Vistra 23.9 Renewables & Other Renewables & Other LS Power 14.0 3 6% 12% Arclight 12
Slide 8: Position of scale in a key power market
PJM Market Position of scale in a key power market Rapid acceleration of PJM Largest, most liquid power Power supply constraints Why PJM? market in N.A. load growth forecasts: are expected to continue +44% by 20401,2 PJM load growth projections continue to rise, helping to support capacity and energ
Slide 9: Enhanced strategic positioning and diversification
PJM Market Enhanced strategic positioning and diversification Net Operating Capacity by Region Leveraging core competencies to enter a key market Current Owned Capacity Pro Forma Owned Capacity • Value creation and optimization MISO MISO 9% • Risk management 11% AESO AESO Market and counterparty div
Slide 10: Hummel Generating Station
High Quality Assets Hummel Generating Station 1,124 MW | Pennsylvania | 100% CPX ownership Large, new & efficient power generation in PJM MAAC Contribution to market and customer reliability • High historical capacity factor (~80%1), potential to increase over time • Low heat rate (6.8 mmbtu/MWh)
Slide 11: Rolling Hills Generating Station
High Quality Assets Rolling Hills Generating Station 1,023 MW | Ohio | 100% CPX ownership Combustion turbine peaking facility in PJM RTO Contribution to market and customer reliability • Flexible peaker, fast ramping capability • Elevated capacity factors given increasing PJM demand profiles St
Slide 12: Highly Accretive Acquisition
Financial Merit Highly Accretive Acquisition Compelling purchase price and prudent funding strategy expected to drive strong risk adjusted returns Attractive Gas Acquisition Metrics Significant AFFO Per Share (EV / Adjusted EBITDA1) Accretion 2 7.8x 17-19% ~7x 6% - 8% Prior CPX Transactions Hummel a
Slide 13: Compelling Financial Metrics
Financial Merit / Institutional Validation Compelling Financial Metrics Financing plan reflects commitment to maintaining IG rating Equity offering $0.5B • ~$3.0B purchase price funded with: • ~$0.5B common share offering comprised of: • Bought deal and concurrent private placement to AIMCo • ~$2.5B
Slide 14: Track Record of Growth and Capital Discipline
Track Record of Growth and Capital Discipline Capital Power has created significant shareholder value Continued Capacity Growth (MW)) Strong Financial Performance Since 2015 1 $6.34 9,633 7,554 7,695 6,210 6,424 6,601 5,073 $3.36 4,484 3,217 3,217 2015A 2016A 2017A 2018A 2019A 2020A 2021A 2022A 2023
Slide 15: CPX Investment Thesis
CPX Investment Thesis Strong fundamentals favour existing gas generation capacity Large, diversified existing generation footprint Strong in-house operational and commercial expertise Proven ability to acquire and optimize thermal generation assets Contracted cash flow provides stability and low-cos
Slide 16: Investor Relations
Investor Relations Roy Arthur VP, Investor Relations 1-403-736-3315 | investor@capitalpower.com capitalpower.com 16
Slide 17: Appendix
Appendix 17
Slide 18: Proven M&A Track Record
Proven M&A Track Record (2) (2) US$/kW $555 $1,347 $517 $830 $547 $752 $684 ~$1,000 (3) AFFOPS(1) (3) (3) (4) (3) 6% 7% 6% 6% 7% n/d 8% 17%-19% Accretion 9.8x 9.1x Avg. EV / 8.6x 7.9x 7.6x 6.7x ~7x Adj. EBITDA(1): 7.8x 4.8x Decatur Energy East Windsor / York Arlington Valley Goreway Midland Frederic
Slide 19: PJM Capacity Market Overview
PJM Capacity Market Overview Designed to Maintain PJM Grid Reliability Historical BRA Capacity Price (US$ / MW-day)1 • In addition to the energy market, where electricity is bought $350 and sold, PJM operates a capacity market $325 • It is designed to ensure adequate power generation capacity $300 i
Slide 20: Proven M&A Track Record
Proven M&A Track Record Acquisition Case Study – La Paloma and Harquahala Alignment to our Capital Investment Strategy Attractive Markets Optimization and Development Potential Created new “hub” in core WECC1 market by adding two Unlocked additional O&M synergies and drives further critical infrastr
Slide 21: Legal Notices
Legal Notices Cautionary Statement Certain information in this presentation and responses by management to questions contain forward-looking Such forward-looking statements are based on certain assumptions and analyses made by Capital Power concerning information within the meaning of Canadian secur
Slide 22: Legal Notices
Legal Notices Future Oriented Financial Information This presentation contains future-oriented financial information and financial outlook information (collectively, For more information regarding the non-GAAP financial measures used by the Company, including the composition of “FOFI”) about the Com
Slide 23: Legal Notices
Legal Notices U.S. Non-Solicitation This presentation is not an offer of securities for sale in the United States and is not an offer to sell or solicitation of an Exchange Rate offer to buy any securities of the Company, nor shall it form the basis of, or be relied upon in connection with any Conve