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COPYRIGHT 2005 Business Wire
CALGARY, Alberta -- TransCanada (TSX:TRP) (NYSE:TRP) :
Fourth Quarter and Year-End 2004 Financial Highlights
(All financial figures are in Canadian dollars unless noted otherwise)
- The Board of Directors of TransCanada Corporation (TransCanada or the company) today declared a quarterly dividend of $0.305 per common share for the quarter ending March 31, 2005, a 5.2 per cent increase over the $0.29 paid in each of the previous four quarters. The dividend is payable on April 29, 2005 to shareholders of record at the close of business on March 31, 2005. This is the fifth consecutive annual increase in the common share dividend.
- TransCanada's net income for fourth quarter 2004 was $185 million or $0.38 per share compared to $193 million or $0.40 per share for fourth quarter 2003.
- For the year ended December 31, 2004, TransCanada's net income was $1,032 million or $2.13 per share, including net income from discontinued operations of $52 million or $0.11 per share. This compares to $851 million or $1.76 per share for 2003, including net income from discontinued operations of $50 million or $0.10 per share.
- Funds generated from continuing operations for fourth quarter 2004 were $467 million, an increase of $64 million compared to fourth quarter 2003. Funds generated from continuing operations for the year ended December 31, 2004 were $1,674 million, a decrease of $136 million compared to 2003.
Hal Kvisle, TransCanada's chief executive officer said, "It has been a year of steady performance for TransCanada. We delivered solid operating and financial results, and invested approximately $2.6 billion, including the assumption of debt, in our core businesses of gas transmission and power generation.
"TransCanada's strong overall performance in 2004 was achieved despite the negative impacts of disappointing decisions from the Alberta Energy and Utilities Board related to the Alberta System and an unfavourable arbitration decision on Ocean State Power gas supply costs. In 2005, we will remain focussed on addressing these issues.
"We will also continue to implement our core strategies to grow our North American operations. That consistency, combined with our strong balance sheet, and skilled and dedicated team of people, will ensure we are well-positioned to continue to capture opportunities that create significant long-term value for our shareholders," said Mr. Kvisle. "Our announcements during the fourth quarter are excellent examples of the initiatives we are undertaking to strengthen our financial performance and create long-term value."
During the fourth quarter 2004, TransCanada:
- Closed the purchase of the 2,174-kilometre Gas Transmission Northwest System and the 128-kilometre North Baja System (collectively GTN) for US$1.7 billion including US$0.5 billion of assumed debt.
- Announced it will proceed with the purchase of hydroelectric generation assets from USGen New England (USGen) with a total generating capacity of 567 megawatts (MW) for US$505 million. The acquisition is subject to regulatory approvals and the pending sale of the 49 MW Bellows Falls hydroelectric facility to the Vermont Hydroelectric Power Authority (Vermont Hydroelectric). If Vermont Hydroelectric acquires Bellows Falls, on which it has exercised its option to purchase, TransCanada's purchase price would be reduced by US$72 million.
- Completed construction of the Grandview cogeneration plant, a 90 MW gas-fired power plant in New Brunswick. The project was completed on time and within budget.
- Announced that Hydro-Quebec Distribution awarded Cartier Wind Energy Inc. (Cartier Wind) six projects totalling 739.5 MW. They are scheduled to be commissioned between 2006 and 2012. In January 2005, TransCanada and its partner, Innergex II Inc., acquired the 20 per cent interest previously held by RES Canada resulting in TransCanada holding a 62 per cent interest and Innergex II Inc. having a 38 per cent interest.
- Announced plans to develop an offshore liquefied natural gas (LNG) regasification facility in the New York State waters of Long Island Sound with Shell US Gas & Power LLC (Shell). Construction is subject to federal and state regulatory approvals.
- Announced in January 2005 it is developing a $200 million natural gas storage facility near Edson, Alberta. The 50 billion cubic feet (Bcf) facility will connect to TransCanada's Alberta System. The company has also secured 40 Bcf of existing Alberta-based gas storage capacity from a third party.
TransCanada's fourth quarter news release, including unaudited financial information, replaces the fourth quarter Report to Shareholders filed by the company in prior years. TransCanada expects to issue its 2004 annual report in mid-March.
Results of Operations Operating Results Three months ended Year ended December 31 December 31 (millions of dollars except 2004 2003 2004 2003 per share amounts) (unaudited) (unaudited) ----------------------------------------- -------- -------- -------- Revenues 1,394 1,319 5,107 5,357 Net Income Continuing operations 185 193 980 801 Discontinued operations - - 52 50 -------- -------- -------- -------- 185 193 1,032 851 -------- -------- -------- -------- -------- -------- -------- -------- Net Income Per Share - Basic Continuing operations $0.38 $0.40 $2.02 $1.66 Discontinued operations - - 0.11 0.10 -------- -------- -------- -------- $0.38 $0.40 $2.13 $1.76 -------- -------- -------- -------- -------- -------- -------- -------- Cash Flows Funds generated from continuing operations 467 403 1,674 1,810 Capital expenditures 185 127 476 391 Acquisitions, net of cash acquired 1,453 23 1,516 570 Dividends Declared Per Share $0.29 $0.27 $1.16 $1.08 Common Shares Outstanding Average for the period 484.7 482.8 484.1 481.5 End of period 484.9 483.2 484.9 483.2 -------------------------------------------------------------------- Consolidated Segment Results-at-a-Glance Three months ended Year ended December 31 December 31 2004 2003 2004 2003 (millions of dollars) (unaudited) (unaudited) ----------------------------------------- -------- -------- -------- Gas Transmission 157 160 586 622 Power 31 44 396 220 Corporate (3) (11) (2) (41) -------- -------- -------- -------- Continuing operations 185 193 980 801 Discontinued operations - - 52 50 -------- -------- -------- -------- Net Income 185 193 1,032 851 -------- -------- -------- -------- -------- -------- -------- --------
Net income and net income from continuing operations (net earnings) for fourth quarter 2004 for TransCanada were $185 million or $0.38 per share compared to $193 million or $0.40 per share for the same period in 2003. This decrease was primarily due to lower net earnings from the Power and Gas Transmission businesses, partially offset by lower net expenses in the Corporate segment.
Net earnings in the Power business for fourth quarter 2004 decreased $13 million compared to fourth quarter 2003 primarily due to lower earnings from Western Operations and Eastern Operations. Lower net earnings of $3 million in the Gas Transmission business for fourth quarter 2004 compared to the same period in 2003 were primarily due to a decline in the Alberta System's net earnings which reflect the impacts of the Alberta Energy and Utilities Board (EUB) decisions in 2004 on Phase I of the 2004 General Rate Application (GRA) and Generic Cost of Capital (GCOC). In addition, a decline in the Canadian Mainline's net earnings resulted primarily from a lower rate of return on common equity and a lower average investment base. These decreases were partially offset by net earnings of $14 million from GTN which was acquired by TransCanada on November 1, 2004. The decrease in net expenses in the Corporate segment was mainly due to the positive effects of various tax adjustments and foreign exchange impacts.
TransCanada's net income for the year ended December 31, 2004 was $1,032 million or $2.13 per share including net income from discontinued operations of $52 million or $0.11 per share, compared to $851 million or $1.76 per share for 2003 including net income from discontinued operations of $50 million or $0.10 per share.
TransCanada's net earnings for the year ended December 31, 2004 were $980 million or $2.02 per share compared to $801 million or $1.66 per share for 2003. The increase of $179 million or $0.36 per share in 2004 was primarily due to significantly higher net earnings from the Power business. In addition, lower net expenses in the Corporate segment offset the lower net earnings from the Gas Transmission business.
The increased Power earnings are primarily due to the second quarter 2004 gain of $15 million after tax ($25 million pre tax) or $0.03 per share on the sale of the ManChief and Curtis Palmer assets to TransCanada Power, L.P. (Power LP) and the recognition of $172 million or $0.36 per share of dilution and other gains resulting...
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