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Canada's TransAlta swings to Q3 net profit but revenue falls

By Reuters News


Overview

  • Canada power generator's Q3 revenue fell yr/yr to C$536 mln

  • Q3 adjusted EBITDA rose yr/yr to C$264 mln

  • Net earnings turned positive at C$63 mln, reversing a loss last year

  • Company acquired Colorado gas assets and sold minority stake in Oklahoma wind portfolio


Outlook

  • Company expects to achieve its 2026 Outlook range

  • Company advancing Centralia conversion and Boreal Technology Hub projects

  • Company to mothball Battle River units and extend Sundance 6 mothball outage


Result Drivers

  • HIGH FLEET AVAILABILITY - Co said strong Q3 results were driven by high fleet availability and disciplined asset optimization, per CEO Joel Hunter

  • OPTIMIZATION AND HEDGING - Co said Alberta portfolio generated realized prices above spot prices due to optimization and hedging programs

  • ENVIRONMENTAL CREDIT PORTFOLIO - Co said environmental credit portfolio contributed to Q3 results


Company press release:


Key Details

Metric

Beat/Miss

Actual

Consensus Estimate

Q3 Revenue

C$536 mln

Q3 EPS

C$0.20

Q3 Net Income

C$63 mln

Q3 Adjusted EBITDA

C$264 mln

Q3 FFO

C$146 mln

Q3 FFO Per Share

C$0.46

Q3 Free Cash Flow

C$93 mln


Analyst Coverage

  • The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 8 "strong buy" or "buy", 1 "hold" and 1 "sell" or "strong sell"

  • The average consensus recommendation for the independent power producers peer group is "buy"

  • Wall Street's median 12-month price target for TransAlta Corporation is C$24.00, about 34.8% above its November 2 closing price of C$17.81

  • The stock recently traded at 33 times the next 12-month earnings vs. a P/E of 44 three months ago


Reuters Recommended Reads

  • Nov 2 - Canada's Capital Power Q3 revenue falls on derivative losses

  • Nov 2 - Canada's Gibson Energy Q3 adjusted EBITDA beats estimates, hits record

  • Nov 3 - Germany awards $13 billion gas plant contracts to utilities including LEAG, RWE


For questions concerning the data in this report, contact Estimates.Support@lseg.com. For any other questions or feedback, contact reuters.support@thomsonreuters.com.


(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)

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