Capital Power Proclaims Second-Quarter Outcomes for the Year 2025
Capital Power Expands U.S. Presence Despite Q2 Earnings Miss
Capital Power Corporation, a leading North American power producer, has made a significant move by acquiring the Hummel and Rolling Hills facilities in the PJM1 market for approximately $3.0 billion (US $2.2 billion). This acquisition has expanded Capital Power's U.S. flexible generation portfolio by 2,147 MW, marking its entry into the PJM interconnection market [1][3].
However, the company's Q2 2025 financial performance showed mixed results. Earnings per share (EPS) came in at -$0.92, significantly missing the forecast of $0.49, and revenue of $441 million also missed the mark, falling short of the forecasted $829 million. The disappointing results caused a stock price drop of about 6.3% [1][3].
The acquisition was financed partly through an equity issuance, a $1.7 billion senior notes private offering, and cash [2][3]. This strategic move supports Capital Power’s expansion into key U.S. markets and diversifies its asset base towards flexible generation.
Despite the Q2 earnings miss, Capital Power remains optimistic about its full-year 2025 performance. The company has revised its adjusted EBITDA guidance to $1,500 million to $1,650 million, up from its original target of $1,340 million to $1,440 million [5]. For the first half of 2025, revenues increased by $63 million year-over-year to $1.684 billion, and adjusted funds from operations (AFFO) rose by $126 million to $453 million, signalling stronger underlying cash flow [1][4].
It's worth noting that AFFO and AFFO per share were also amended to exclude acquisition and integration costs. Adjusted EBITDA is used by Capital Power to measure the operating performance of facilities and categories of facilities from period to period [6].
In other developments, Capital Power reached commercial operation of the 40MW uprate at Goreway and advanced four other long-term contracted projects in Ontario with 310MW of total capacity [7]. The company also started construction on two additional solar projects in North Carolina, with commercial operation expected between Q4 2026 and Q1 2027 [8].
Capital Power respectfully acknowledges that it operates within the ancestral homelands, traditional, and treaty territories of the Indigenous Peoples of Turtle Island or North America [9].
Whether actual results, performance, or achievements will conform to expectations is subject to known and unknown risks and uncertainties [10]. Forward-looking information in this MD&A includes expectations regarding future revenues, expenses, earnings, adjusted EBITDA, and AFFO, among other things [11]. Material forward-looking information is based on certain assumptions and analyses made by the Company [11].
References: 1. Capital Power Corporation Q2 2025 Earnings Release 2. Capital Power Corporation Acquires Hummel and Rolling Hills Facilities 3. Capital Power Corporation Stock Drops After Earnings Miss 4. Capital Power Corporation Q2 2025 Earnings Call Transcript 5. Capital Power Corporation Revises 2025 Annual Guidance 6. Capital Power Corporation MD&A 7. Capital Power Corporation Reaches Commercial Operation at Goreway 8. Capital Power Corporation Starts Construction on Solar Projects in North Carolina 9. Capital Power Corporation Acknowledges Indigenous Territories 10. Capital Power Corporation Forward-Looking Information 11. Capital Power Corporation MD&A
- Capital Power's business expansion into the PJM interconnection market includes the acquisition of the Hummel and Rolling Hills facilities, a move that will significantly impact the energy industry.
- The Q2 2025 financial results for Capital Power Corporation showed a missed earnings forecast and revenue shortfall, causing a notable drop in stock price.
- Despite the Q2 earnings miss, Capital Power remains optimistic about its annual performance, having revised its adjusted EBITDA guidance for the full year 2025.
- Capital Power's acquisition of the Hummel and Rolling Hills facilities, primarily financed through equity issuance, senior notes private offering, and cash, will diversify the company's asset base towards flexible generation.
- Climate change and sustainability efforts are evident in Capital Power's ongoing development projects, with advancements in Ontario and construction of solar projects in North Carolina.
- While the community, media, and finance sectors closely follow Capital Power’s business activities and financial performance, the company's focus remains on its long-term goals and adherence to Canadian laws.
- Capital Power respects the environment and the Indigenous communities it operates within, acknowledging that its activities take place on the ancestral homelands, traditional, and treaty territories of the Indigenous Peoples of Turtle Island or North America.
