Canada's Capital Power reports Q4 loss versus year-ago profit

Overview

• Canada power producer's Q4 net loss was C$13 mln, with adjusted EBITDA at C$414 mln

• Company completed acquisition of U.S. facilities, adding 2.2 GW of capacity

• Increased common share dividend by 6%, marking 12th consecutive yr of growth

Outlook

• Capital Power expects Arlington Valley facility to realize US$70 mln adjusted EBITDA uplift by 2032

• Company anticipates 250 MW Alberta data center ESA to commence in 2028

• Capital Power plans 35 MW capacity uprate at Arlington Valley by 2027

Result Drivers

• U.S. EXPANSION - Acquisition of Hummel and Rolling Hills facilities added ~2.2 GW of U.S. natural gas capacity, enhancing growth

• LONG-TERM CONTRACTS - New contract for Midland Cogeneration Venture extends cash flows through 2040

• RENEWABLE PROJECTS - Reached commercial operation for ~60 MW of contracted projects and commissioned 170 MW of battery storage in Ontario

Company press release: ID:nGNX5dJwpJ

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 10 "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 Capital Power Corp is C$77.00, about 22.9% above its March 3 closing price of C$62.66

• The stock recently traded at 23 times the next 12-month earnings vs. a P/E of 22 three months ago

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