TransAlta (TAC) saw its stock price plummet 5.08% in intraday trading on Wednesday following the release of its disappointing first-quarter earnings report. The Canadian utility company's results fell short of analyst expectations, prompting investors to reassess their positions.
TransAlta reported adjusted earnings per share of CA$0.10 for Q1 2025, slightly below the FactSet analyst consensus estimate of CA$0.11. The company's revenue for the quarter came in at CA$758 million, representing a significant 19.96% decrease from CA$947 million in the same period last year. Net earnings per share also saw a dramatic decline, dropping from CA$0.72 in Q1 2024 to just CA$0.15 this quarter.
The earnings downturn was primarily attributed to weakness in TransAlta's hydro and gas operations. The company's hydro segment was negatively impacted by lower spot-power prices and services prices in the Alberta market, while the gas segment suffered from lower volumes due to milder weather conditions. Despite these challenges, TransAlta maintains its full-year guidance, targeting adjusted EBITDA between C$1.15 billion and C$1.25 billion. However, investors appear skeptical, as reflected in the sharp stock price decline following the earnings release.