TransCanada Announces Second Quarter Results, Board Declares Dividend of $0.305 per Share
CALGARY, Alberta – July 29, 2005 – (TSX: TRP) (NYSE: TRP)
Second Quarter 2005 Highlights:
(All financial figures are in Canadian dollars unless noted otherwise).
TransCanada Corporation today announced net income for second quarter 2005 of $200 million or $0.41 per share, compared to $388 million or $0.80 per share for second quarter 2004. The decrease of $188 million or $0.39 per share was primarily due to the recording in second quarter 2004 of $187 million of after-tax gains relating to the sale of the ManChief and Curtis Palmer assets to TransCanada Power, L.P. (Power LP) and the recognition of dilution gains resulting from a reduction in TransCanada’s ownership interest in Power LP and other previously deferred gains, as well as a $7 million after-tax gain on sale of the company’s equity interest in the Millennium Pipeline project.
Excluding the total gains of $194 million recorded in second quarter 2004 and $1 million recorded in second quarter 2005, net income for second quarter 2005 increased $5 million to $199 million compared to second quarter 2004. The increase was mainly due to higher net income from Gas Transmission which benefited from a National Energy Board (NEB) decision on the Canadian Mainline’s 2004 Tolls and Tariff Application (Phase II) effective from January 1, 2004, as well as contributions from the Gas Transmission Northwest System and the North Baja System which were acquired by TransCanada in fourth quarter 2004. The higher net income in Gas Transmission was partially offset by a decrease of $20 million in Power’s net income, primarily due to lower equity income from Bruce Power L.P. and lower operating and other income from Western Operations, partially offset by higher operating and other income from Eastern Operations.
For the first six months of 2005, TransCanada’s net income was $432 million or $0.89 per share, compared to $602 million or $1.24 per share for the same period in 2004. The decrease of $170 million or $0.35 per share was mainly the result of significantly higher net income in the Power business in 2004 resulting mainly from the gains related to Power LP.
Funds generated from operations of $479 million and $886 million for the three and six months ended June 30, 2005 increased $97 million and $89 million, respectively, when compared to the same period in 2004.
“Through the second quarter 2005, TransCanada continued to identify and evaluate opportunities to further strengthen its position as a leading energy infrastructure company in North America,” said Hal Kvisle, TransCanada’s chief executive officer.
“Over the long term, we continue to see significant, high quality opportunities to grow and create value for shareholders through greenfield developments and acquisitions.”
During the second quarter, TransCanada:
U.S. GAAP restatement
The company is refiling its 2004 consolidated financial statements, which contain a restated Note 22 (U.S. GAAP), with securities regulators in Canada and the United States. The restatement relates to the reporting of TransCanada’s investment in Power LP. For U.S. generally accepted accounting principles (GAAP) purposes, certain transactions involving Power LP, in the period 1997 to 2001, should have been accounted for differently than under Canadian GAAP. This has been corrected on a retroactive basis. The restated Note has no impact on TransCanada’s 2004 financial statements as reported under Canadian GAAP or on total shareholders’ equity at December 31, 2004 as prepared under U.S. GAAP.
Consolidated financial statements for the year ended December 31, 2004 containing the restated Note will be filed on SEDAR and EDGAR and are available at www.transcanada.com. Printed copies may be obtained from TransCanada by calling (403) 920-2000.
TransCanada will hold a teleconference today at 9 a.m. (Mountain) / 11 a.m. (Eastern) to discuss the second quarter 2005 financial results and general developments and issues concerning the Company. Analysts, members of the media and other interested parties wanting to participate should phone 1-866-546-6145 or 416-406-4206 (Toronto area) at least 10 minutes prior to the start of the teleconference. No passcode is required. A live audio webcast of the teleconference will also be available on TransCanada's website at www.transcanada.com.
The conference will begin with a short address by members of TransCanada's executive management, followed by a question and answer period for investment analysts. A question and answer period for members of the media will immediately follow.
A replay of the teleconference will be available two hours after the conclusion of the call until midnight (Eastern) August 5, 2005 by dialing 1-800-408-3053 or 416-695-5800 (Toronto area) and entering passcode 3158123. The webcast will be archived and available for replay.
TransCanada is a leading North American energy company. TransCanada is focused on natural gas transmission and power services with employees who are expert in these businesses. TransCanada’s network of approximately 41,000 kilometres (25,600 miles) of pipeline transports the majority of Western Canada’s natural gas production to the fastest growing markets in Canada and the United States. TransCanada owns, controls or is constructing approximately 5,700 megawatts of power generation – an amount of power that can meet the needs of about 5.7 million average households. TransCanada announced in May that it plans to sell its interest in TransCanada Power, L.P., which owns a 744 megawatt power portfolio. The Company’s common shares trade under the symbol TRP on the Toronto and New York stock exchanges.
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For further information, please contact:
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