Capital Power reports first quarter 2026 results, underpinned by strong flexible generation performance and continued contracting success

EDMONTON, Alberta, April 29, 2026 (GLOBE NEWSWIRE) -- Capital Power Corporation (TSX: CPX) today released financial results for the quarter ended March 31, 2026.

Highlights

• Extended the Arlington Valley summer tolling agreement with the existing investment‑grade counterparty through 2038, adding 7 years of contracted revenue and approximately US$70 million in incremental annual capacity payments by 2032 relative to 2025
• Generated AFFO of $154 million and net cash flows from operating activities of $312 million
• Generated adjusted EBITDA of $404 million and net income of $15 million
• Announced the appointment of Kevin MacIntosh as Chief Financial Officer, effective March 16, 2026

CEO Message

Our favorable first quarter results demonstrate the resilience of Capital Power’s diversified, strategically positioned portfolio in a period of heightened global and market uncertainty. Our strategy continues to be grounded in securing durable, long-term contracts with creditworthy counterparties across a broad opportunity set. Demonstrating our ability to execute our strategy, we extended the summer tolling agreement at Arlington Valley to 2038.

Furthermore, we continue to proactively manage risk through our industry-leading supply and trading function. In combination, our focus on long-term contracting and risk management provides stable, predictable cash flows, and downside protection across cycles. This disciplined foundation allows us to remain focused on execution while maintaining a strong financial position and return proposition balanced between growth and yield.

Market fundamentals in our core regions remain constructive. In Alberta, enhanced certainty around key regulatory items and improving supply‑demand dynamics reinforce a strengthening outlook, while PJM continues to offer attractive long‑term fundamentals despite ongoing policy and market changes. Diversification across geographies and technologies remains a core strength for our business, enabling us to allocate capital prudently across natural gas, renewables, and battery energy storage where we find returns that are compelling.

We remain confident in our ability to deliver growth while maintaining our balanced risk‑return profile. Our approach has not changed: disciplined capital allocation, long-term contracting, and a diversified platform that supports consistent performance through uncertainty while positioning Capital Power for long‑term shareholder value creation.

2026 Annual Guidance

1. For the three months ended March 31, 2026.
2. Includes our share of equity-accounted investments sustaining capital expenditures of $11 million net of partner contributions of $9 million.
3. AFFO and adjusted EBITDA are non-GAAP financial measures. See Non-GAAP Financial Measures and Ratios.
   

Operational and Financial Highlights¹

1. The operational and financial highlights in this press release should be read in conjunction with the Management’s Discussion and Analysis (MD&A) and the unaudited condensed interim financial statements for the three months ended March 31, 2026.
2. Gigawatt hours (GWh) of electricity generation reflects the Company’s share of facility output and includes GWh discharged from BESS.
3. Facility availability represents the percentage of time in the period that the facility was available to generate power regardless of whether it was running and therefore is reduced by planned and unplanned outages.
4. Diluted earnings per share was calculated after giving effect to outstanding share purchase options.
5. The consolidated financial highlights, except for adjusted EBITDA, AFFO and AFFO per share were prepared in accordance with GAAP. See Non-GAAP Financial Measures and Ratios.

Significant Events

Kevin MacIntosh appointed Chief Financial Officer

On February 19, 2026, Kevin MacIntosh was appointed as Chief Financial Officer of the Company, effective March 16, 2026. Mr. MacIntosh has over 30 years of experience as a finance leader working in large, complex organizations within the global energy industry and brings expertise across multi-jurisdictional operations, cross-border transactions, energy trading and diverse regulatory landscapes.

Arlington Valley tolling agreement extension and increased summer capacity

In January 2026, Capital Power extended its summer tolling agreement for the Arlington Valley facility with the current counterparty, an investment-grade utility. The agreement extends the existing 2031 agreement through October 2038 adding 7 years of contracted revenue and positioning Capital Power for continued growth and value creation in the U.S. southwest. The 6-month contract structure enables the facility to capture increasing merchant value during the winter months, while retaining the stability of contracted summer revenues. As part of this agreement, the facility will undergo a 35 MW capacity uprate to summer capacity; 10 MWs will be added in 2026 and an additional 25 MWs in 2027.

The facility is expected to receive an increase in capacity payments of approximately US$70 million annually by 2032, relative to 2025. This investment will strengthen Arlington Valley’s ability to provide reliable power during Arizona’s peak summer demand. Additional information regarding the accounting treatment is described in note 8 of the condensed interim consolidated financial statements for the period ended March 31, 2026.

Analyst conference call and webcast

Capital Power will be hosting a conference call and live webcast with analysts on April 29, 2026 at 9:00 am (MT) to discuss the first quarter financial results. The webcast can be accessed at: https://edge.media-server.com/mmc/p/erwbtd8o. Conference call details will be sent directly to analysts.

An archive of the webcast will be available on the Company’s website at www.capitalpower.com following the conclusion of the analyst conference call.

Non-GAAP Financial Measures and Ratios        

Capital Power uses (i) earnings before income tax expense, depreciation and amortization, net finance expense, foreign exchange gains or losses, gains or losses on disposals and other transactions, unrealized changes in fair value of commodity derivatives and emission credits, other expenses from our equity-accounted investments, acquisition and integration costs, and other items that are not reflective of the Company’s facility operating performance (adjusted EBITDA), and (ii) adjusted funds from operations (AFFO) as specified financial measures. Adjusted EBITDA and AFFO are both non-GAAP financial measures.

Capital Power also uses AFFO per share as a specified performance measure. This measure is a non-GAAP ratio determined by applying AFFO to the weighted average number of common shares used in the calculation of basic and diluted earnings per share.

These terms are not defined financial measures according to GAAP and do not have standardized meanings prescribed by GAAP and, therefore, are unlikely to be comparable to similar measures used by other enterprises. These measures should not be considered alternatives to net income, net income attributable to shareholders of Capital Power, net cash flows from operating activities or other measures of financial performance calculated in accordance with GAAP. Rather, these measures are provided to complement GAAP measures in the analysis of our results of operations from management’s perspective.

Adjusted EBITDA

Capital Power uses adjusted EBITDA to measure the operating performance of facilities and categories of facilities from period to period. Management believes that a measure of facility operating performance is more meaningful if results not related to facility operations are excluded from the adjusted EBITDA measure such as impairments, foreign exchange gains or losses, gains or losses on disposals and other transactions, unrealized changes in fair value of commodity derivatives and emission credits, acquisition and integration costs, and other items that are not reflective of the long-term performance of the Company’s underlying operations.

A reconciliation of adjusted EBITDA to net income is as follows:

1. Includes finance expense, depreciation expense and unrealized changes in fair value of derivative instruments from equity-accounted investments.
2. For the three months ended March 31, 2025, other non-recurring items reflects costs related to the end-of-life of Genesee coal operations.

AFFO and AFFO per share

AFFO and AFFO per share are measures of our ability to generate cash from our operating activities to fund growth capital expenditures, repayment of debt, and payment of common share dividends.

AFFO represents net cash flows from operating activities adjusted to:

• exclude timing impacts of cash receipts and payments that may impact period-to-period comparability by including deductions for net finance expense and current income tax expense, and excluding deductions for interest paid, deductions for income taxes paid and changes in operating working capital,
• include our share of AFFO of equity-accounted investments and exclude distributions received from our equity-accounted investments which are calculated after the effect of non-operating activity equity-accounted investments debt payments,
• include cash from off-coal compensation received annually through to 2030,
• exclude the tax equity financing project investors’ shares of AFFO associated with assets under tax equity financing structures so only Capital Power’s share is reflected in the overall metric,
• exclude sustaining capital expenditures and preferred share dividends,
• exclude the impact of fair value changes in certain unsettled derivative financial instruments that are charged or credited to our bank margin account held with a specific exchange counterparty,
• exclude acquisition and integration costs, and
• exclude other typically non-recurring items affecting cash flows from operating activities that are not reflective of the long-term performance of the Company’s underlying business.

A reconciliation of net cash flows from operating activities to AFFO is as follows:

1. Included in other cash items on the condensed interim consolidated statements of cash flows to reconcile net income to net cash flows from operating activities.
2. Excludes unrealized changes on interest rate derivative contracts, amortization, accretion charges, and non-cash implicit interest on tax equity investment structures.
3. For the three months ended March 31, 2025, excludes current income tax expense related to the partial divestiture of Quality Wind and Port Dover and Nanticoke Wind in 2024 as the amount is classified as an investing activity.
4. Includes sustaining capital expenditures net of partner contributions of $9 million and $4 million for the three months ended March 31, 2026 and 2025, respectively.
5. For the three months ended March 31, 2026, other non-recurring items reflect current income tax recoveries of $2 million related to other non-recurring items recognized in prior periods. For the three months ended March 31, 2025, other non-recurring items reflects costs related to the end-of-life of Genesee coal operations of $5 million net of current income tax expenses of $9 million.

Forward-looking information

Forward-looking information or statements (collectively, "forward-looking information ") included in this press release are provided to inform our shareholders, potential investors and other stakeholders about Management’s assessment of Capital Power’s future plans and operations. This information may not be appropriate for other purposes. The forward-looking information in this press release is generally identified by words such as will, anticipate, believe, plan, intend, target, and expect or similar words that suggest future outcomes.

Material forward-looking information in this press release includes, among other things, expectations regarding:

• our priorities and strategies, including our strategy of securing durable, long-term contracts from creditworthy counterparties across a broad opportunity set,
• our 2026 performance targets, including sustaining capital expenditures, AFFO and adjusted EBITDA,
• the outcomes resulting from the Arlington Valley tolling agreement extension and capacity uprate project, including expectations regarding the anticipated capacity payment increase from the facility and the anticipated timing and realization of such financial benefits, and
• the construction of the solar projects in North Carolina and the timing of their expected commercial operation.

These statements are based on certain assumptions and analyses made by the Company in light of its experience and perception of historical trends, current conditions, expected future developments, and other factors it believes are appropriate including its review of purchased businesses and assets. The material factors and assumptions used to develop this forward-looking information relate to:

• electricity and other energy (including natural gas) and carbon prices,
• the Company 's performance,
• the Company 's business prospects (including potential re-contracting of facilities) and opportunities including expected growth and capital projects,
• the energy needs of certain jurisdictions,
• the status and impact of policy, legislation and regulations,
• effective tax rates,
• the development and performance of technology,
• the outcome of claims and disputes,
• foreign exchange rates, and
• other matters discussed under the Performance Outlook and Risks and Risk Management sections of the MD&A.

Whether actual results, performance or achievements will conform to our expectations and predictions is subject to a number of known and unknown risks and uncertainties which could cause actual results and experience to differ materially from our expectations. Such material risks and uncertainties include:

• changes in electricity, natural gas and carbon prices in markets in which we operate and the use of derivatives,
• regulatory and political environments including changes to environmental, climate, financial reporting, market structure and tax legislation,
• disruptions, or price volatility within our supply chains,
• generation facility availability, wind capacity factor and performance including maintenance expenditures,
• ability to fund current and future capital and working capital needs,
• acquisitions and developments including timing and costs of regulatory approvals and construction,
• changes in market prices and the availability of fuel,
• ability to realize the anticipated benefits of acquisitions,
• limitations inherent in our review of acquired assets,
• changes in general economic and competitive conditions, including inflation and recession,
• changes in the performance and cost of technologies and the development of new technologies, new energy efficient products, services and programs, and 
  
• risks and uncertainties discussed under the Risks and Risk Management section of the MD&A.

See Risks and Risk Management in our 2025 Integrated Annual Report, for further discussion of these and other risks.

Readers are cautioned not to place undue reliance on any such forward-looking information, which speak only as of the date made and that other events or circumstances, although not listed above, could cause Capital Power 's actual results to differ materially from those estimated or projected and expressed in, or implied by the forward-looking information. Capital Power does not undertake or accept any obligation or undertaking to release publicly any updates or revisions to any forward-looking information to reflect any change in our expectations or any change in events, conditions or circumstances on which any such statement is based, except as required by law.

Note: References to flexible generation are defined as natural gas generation assets and energy storage.

About Capital Power

Capital Power is one of North America 's leading independent power producers, with approximately 12 GW of generation capacity across 35 facilities. Our portfolio includes natural gas, renewables, and battery energy storage solutions. We deliver power generation at utility-scale through a flexible and resilient fleet built to meet growing electricity demand. Backed by an investment-grade credit rating, we provide safe, reliable power communities can depend on. We are Powering Change by Changing Power™.  

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