TransAlta Reports First Quarter 2023 Results and Raises 2023 Financial Guidance.

CALGARY, AB:

First Quarter 2023 Financial Highlights

Adjusted EBITDA(1),(2) of $503 million, an increase of 94% over the same period in 2022

Free Cash Flow ("FCF")(1) of $263 million, or $0.98 per share, an increase of 145% on a per-share basis from the same period in 2022

Earnings before income taxes of $383 million, an improvement of $141 million from the same period in 2022

Net earnings attributable to common shareholders of $294 million, an increase of $108 million from the same period in 2022

Cash flow from operating activities of $462 million, an increase of 2% from the same period in 2022

Other Business Highlights

Returned $36 million of capital to common shareholders through share buybacks of 3.2 million common shares

Entered into an automatic share purchase plan to facilitate repurchases of common shares through the normal course issuer bid during blackout periods

Announced agreement to acquire a 50% interest in a 320 MW early-stage pumped hydro development project

Kent Hills rehabilitation program on track with 13 turbines reassembled and commissioning commenced in late April

Garden Plain construction nearing completion with all turbines assembled and commercial operations to commence during the second quarter of 2023

Northern Goldfields construction nearing completion with commercial operations to commence during the second quarter of 2023

Mount Keith 132kV expansion project construction activities have commenced and are on track to be completed in latter half of 2023

2023 Revised Outlook

Increased 2023 annual financial guidance as set out below:

Adjusted EBITDA range of $1.45 billion to $1.55 billion, an increase of 19% at the midpoint of prior guidance

FCF range of $650 million to $750 million, an increase of 15% at the midpoint of prior guidance

Energy Marketing gross margin range of $130 million to $150 million, an increase of 40% at the midpoint of prior guidance

TransAlta Corporation ("TransAlta" or the "Company") (TSX: TA) (NYSE: TAC) today reported its financial results for the three months ended March 31, 2023.

"Our first quarter results continue to demonstrate the value of our strategically diversified fleet. Our results benefited from our strong operations and asset optimization and hedging activities. With our performance across the fleet and our continuing positive expectations for the balance of year, we have revised our 2023 full year financial guidance upwards for both adjusted EBITDA and free cash flow, with revised midpoints exceeding the top end of our original targets to reflect stronger market conditions and solid operational performance," said John Kousinioris, President and Chief Executive Officer of TransAlta.

"We continue to advance our growth plan and are progressing several opportunities with 374 MW of projects in an advanced stage of development. Our progress is on track, and the cash flows from our legacy fleet are positioning us well to realize our Clean Electricity Growth Plan," added Mr. Kousinioris.

Key Business Developments

Automatic Share Purchase Plan

On March 27, 2023, the Company entered into an automatic share purchase plan ("ASPP") in order to facilitate repurchases of TransAlta's common shares under its previously announced normal course issuer bid ("NCIB"). The Company has received approval from the Toronto Stock Exchange to purchase up to 14,000,000 common shares during the 12-month period that commenced May 31, 2022 and terminates May 30, 2023, representing approximately 5.2 per cent of the Company's currently issued and outstanding Common Shares as at Dec. 31, 2022.

Under the ASPP, the Company's broker may purchase common shares from the effective date of the ASPP until the end of the NCIB. All purchases of common shares made under the ASPP will be included in determining the number of common shares purchased under the NCIB. Any common shares purchased by the Company pursuant to the NCIB will be cancelled. The ASPP will terminate on the earliest of the date on which: (a) the maximum purchase limits under the ASPP are reached; (ii) the NCIB expires; or (iii) the Company terminates the ASPP in accordance with...