CALGARY, AB, May 6, 2026 /CNW/ - ATCO Ltd. (TSX: ACO.X)
ATCO Ltd. (ATCO or the Company) today announced first quarter 2026 adjusted earnings ((1) () of $165 million ($1.47 per share), which were $5 million ($0.04 per share) higher compared to $160 million ($1.43 per share) in the first quarter of 2025.
First quarter 2026 earnings attributable to Class I non-voting and Class II voting shares reported in accordance with International Financial Reporting Standards (IFRS earnings) were $152 million ($1.35 per share), which were $8 million ($0.07 per share) higher compared to $144 million ($1.28 per share) in the first quarter of 2025.
RECENT DEVELOPMENTS
ATCO Structures
ATCO Structures continued growing its market presence through organic strategic initiatives and investment in its base business, particularly in space rentals. This included expansion and optimization of the global rental fleet. The below awards illustrate the diversity of geographies and industries that ATCO Structures services:
-- ATCO Structures received limited notices to proceed for early-stage work,
including infrastructure planning and camp design services, for mining
developments in Western Canada and Western Australia. The contracts are
anticipated to commence in 2026 and have a combined contract value of
$100 million.
-- In the first quarter of 2026, the initial units' design and manufacturing
were completed for the $179 million contract with Perpetua Resources
Corp. to supply and install a 1,052-person dormitory lodge and office
facilities in support of the Stibnite Gold Project located near Yellow
Pine, Idaho.
-- Awarded contracts in the US to provide space rental and workforce housing
solutions supporting data centre construction in Texas and Utah, and
nuclear power generation in Idaho and Wyoming. These awards comprise 172
modular units and total $23 million in sale and lease contracts.
-- Awarded contracts to provide space rental, workforce housing, and
permanent modular construction solutions supporting emergency response
projects in Western and Central Canada, public infrastructure and defence
in Central Canada, and affordable housing and mining operations in
Western Canada. These awards comprise 341 modular units and total $73
million in sale and lease contracts.
-- Awarded contracts in Australia to provide workforce housing solutions
supporting public infrastructure development in Western Australia and
modular brokering operations in Queensland. These awards comprise 140
units and total $17 million in sale contracts.
__________________________
(1) Adjusted earnings is a total of segments measure
(as defined in National Instrument 52-112 - Non-GAAP
and Other Financial Measures Disclosure (NI 52-112)).
See Other Financial and Non-GAAP Measures Advisory
included in this news release.
ATCO Frontec
-- Subsequent to quarter-end, the Government of Nunavut has awarded ATCO
Frontec a $41 million contract to construct a new water treatment plant
in Pond Inlet, Nunavut. This water treatment plant will service
approximately 1,500 residents in the remote hamlet located on Baffin
Island. This 2-year contract includes decommissioning of the aging
existing plant, upgrading reservoir systems, and construction of the full
water treatment facility.
ATCO Investments
-- In the first quarter of 2026, it was announced that ATCO will provide
approximately $10 million of staged investment for 40 per cent ownership
in West Kitikmeot Resources Corp. (WKR). Backed by significant Inuit
ownership, WKR is the sole proponent developing the Grays Bay Road and
Port Project (GBRP), a critical infrastructure project consisting of a
greenfield deepwater port with access to the Northwest Passage shipping
corridor, a 230-kilometre all-season road leading inland, and a
6,000-foot airstrip. GBRP is a multi-use, strategic asset that has
recently been referred to the Canadian Federal Government's Major
Projects Office.
Canadian Utilities
-- Canadian Utilities invested $353 million of capital expenditures in the
first quarter of 2026, of which 94 per cent was invested in our regulated
utilities in ATCO Energy Systems and ATCO Australia, with the remaining 6
per cent largely invested in ATCO EnPower.
-- ATCO Energy Systems continues to work on many utility infrastructure
opportunities, including two previously announced projects: the
Yellowhead Pipeline Project (Yellowhead) in Natural Gas Transmission and
the Central East Transfer-Out Project (CETO) in Electricity Transmission.
-- Yellowhead is on track for construction to commence in 2026,
subject to Alberta Utilities Commission (AUC) and corporate
approvals. Upon AUC's approval of the Need Assessment Application
for the expected $2.9 billion project in the third quarter of
2025, ATCO Energy Systems filed a separate facility application on
November 4, 2025 to seek AUC approval for construction and
operation of the physical infrastructure. An AUC hearing is
scheduled for May 2026 with a decision expected by the third
quarter of 2026. Construction and execution schedules will be
finalized following the approval of the facility application and
mainline contractor selections.
-- Electricity Transmission completed line construction for CETO
ahead of schedule in the first quarter of 2026. Electricity
Transmission's 85-km of the transmission line is on track to be
energized by June 2026 with an approximate $255 million project
spend. CETO will support renewable energy integration in Alberta
and transport electricity in the counties of Red Deer, Lacombe and
Stettler, supplying more than 1,500 megawatts of electricity to
Alberta's grid.
-- To fund ATCO Energy Systems' regulated debt requirements, the Company
expects to issue debentures each year during the five-year (2026-2030)
capital expenditure plan. For regulated equity requirements, in addition
to cash flow from operations and the $0.7 billion financed in 2025, the
Company expects to raise an additional $0.8 billion of capital securities
(2) over the five-year (2026-2030) capital expenditure plan to fund the
equity portion of investment.
Corporate
-- On April 9, 2026, ATCO declared a second quarter dividend of 51.96 cents
per share or $2.08 per Class I non-voting and Class II voting share on an
annualized basis.
-- On May 7, 2026, ATCO will release our 2025 Sustainability Report which
presents current and comprehensive information on the topics of
Governance & Responsible Business, Resilience & Safety, Energy Transition
& Environment, and People & Partners.
This news release should be read in concert with the full disclosure documents. ATCO's unaudited interim consolidated financial statements and management's discussion and analysis for the quarter ended March 31, 2026 will be available on the ATCO website (www.ATCO.com), via SEDAR+ (www.sedarplus.ca) or can be requested from the Company.
_____________________ (2) Capital securities could include preferred shares, hybrid bonds, and/or debentures.
TELECONFERENCE AND WEBCAST
ATCO will hold a live teleconference and webcast with Katie Patrick, Executive Vice President, Chief Financial & Investment Officer and Adam Beattie, President, Structures at 10:00 am Mountain Time (12:00 pm Eastern Time) on Wednesday, May 6, 2026 at 1-833-821-0222. No pass code is required.
Opening remarks will be followed by a question and answer period with investment analysts. Participants are asked to please dial-in 10 minutes prior to the start and request to join the ATCO teleconference.
Management invites interested parties to listen via live webcast at: https://www.atco.com/en-ca/about-us/investors/events-presentations.html.
A replay of the teleconference will be available approximately two hours after the conclusion of the call until June 6, 2026. Please call 1-855-669-9658 and enter pass code 8424524.
As a global enterprise, ATCO Ltd. and its subsidiary and affiliate companies have approximately 20,000 employees and assets of $28 billion. ATCO is committed to future prosperity by working to meet the world's essential energy, housing, security and transportation challenges. ATCO Structures designs, builds and delivers products to service the essential need for housing and shelter around the globe. ATCO Frontec provides operational support services to government, defence and commercial clients. ATCO Energy Systems delivers essential energy for an evolving world through its electricity and natural gas transmission and distribution, and international electricity operations. ATCO EnPower creates sustainable energy solutions in the areas of electricity generation, energy storage, industrial water and cleaner fuels. ATCO Australia develops, builds, owns and operates energy and infrastructure assets. ATCO Energy provides retail electricity and natural gas services, home maintenance services and professional home advice that bring exceptional comfort, peace of mind and freedom to homeowners and customers. ATCO also has investments in ports and transportation logistics, the processing and marketing of ash, retail food services and commercial real estate. More information can be found at www.ATCO.com.
Investor & Analyst Inquiries:
Colin Jackson
Senior Vice President, Financial Operations
Colin.Jackson@atco.com
(403) 808 2636
Media Inquiries:
Kurt Kadatz
Director, Corporate Communications
Contact Media Relations
(587) 228 4571
Subscription Inquiries:
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Other Financial and Non-GAAP Measures Advisory
Adjusted Earnings
Consolidated adjusted earnings is a "total of segments measure", as defined in National Instrument 52-112 -- Non-GAAP and Other Financial Measures Disclosure ("NI 52-112"). The most directly comparable measure to adjusted earnings reported in accordance with IFRS is "earnings attributable to Class I non-voting and Class II voting shares". IFRS earnings include timing adjustments related to rate-regulated activities, unrealized gains or losses on mark-to-market forward and swap commodity contracts, one-time gains and losses, impairments, and items that are not in the normal course of business or a result of day-to-day operations. These items are not included in adjusted earnings. A reconciliation of adjusted earnings to earnings attributable to Class I non-voting and Class II voting shares is provided below.
Three Months Ended
March 31
($ millions except share data) 2026 2025
Adjusted Earnings 165 160
Unrealized gains (losses) on mark-to-market forward
and swap commodity contracts (1) 7 (4)
Rate-regulated activities (2) (19) 2
IT Common Matters decision (3) (1) (1)
Transition of managed IT services (4) -- (5)
Restructuring (5) -- (8)
Earnings attributable to Class I non-voting and Class
II voting shares 152 144
Weighted average shares outstanding (millions of shares) 112.4 112.3
(1) The Company's electricity generation and retail electricity
and natural gas businesses in Alberta enter into fixed-price
swap commodity contracts to manage exposure to electricity
and natural gas prices and volumes. These contracts
are measured at fair value. Unrealized gains and losses
due to changes in the fair value of the fixed-price
swap commodity contracts in the electricity generation
and electricity and natural gas retail businesses
are recognized in the earnings of the ATCO EnPower
segment and ATCO Investments segment, respectively.
Realized gains or losses are recognized in adjusted
earnings when the commodity contracts are settled.
(2) The Company records significant timing adjustments
as a result of the differences between rate-regulated
accounting and IFRS with respect to additional revenues
billed in the current year, revenues to be billed
in future years, regulatory decisions received, and
settlement of regulatory decisions and other items.
(3) Consistent with the treatment of the gain on sale
in 2014 from the IT services business by the Company,
financial impacts associated with the IT Common Matters
decision are excluded from adjusted earnings.
(4) In the first quarter of 2025, the Company recognized
IT transition costs of $5 million (after-tax and non-controlling
interests). The transition costs were primarily related
to activities to shift the managed IT services from
a single-vendor service provider to a hybrid model
of multiple new vendors and internal teams. As these
costs were not in the normal course of business, they
were excluded from adjusted earnings.
(5) In the first quarter of 2025, the Company recorded
restructuring costs of $8 million (after-tax and non-controlling
interests) mainly related to staff reductions and
associated severance costs. As these costs were not
in the normal course of business, they were excluded
from adjusted earnings.
Forward-Looking Information Advisory
Certain statements contained in this news release constitute forward-looking information. Forward-looking information is often, but not always, identified by the use of words such as "anticipate", "plan", "estimate", "expect", "may", "will", "intend", "should", "goals", "targets", "strategy", "future", and similar expressions. In particular, forward-looking information in this news release includes, but is not limited to, references to: the expected term, value, and deliverables associated with referenced ATCO Structures and ATCO Frontec contracts; expectations regarding the Yellowhead project, including the anticipated timing for commencement of construction, the anticipated total investment in the project, and the anticipated timing and outcome of regulatory decisions from the AUC in relation to the project; the anticipated size, capacity and benefits of CETO, the anticipated timing for energization, and the anticipated total investment in the project; expectations regarding the Company's funding strategy for ATCO Energy Systems' regulated debt and equity requirements, including anticipated debenture issuances over the five year (2026-2030) capital expenditure plan, cash flow from operations, $0.7 billion financed in 2025, and an additional $0.8 billion in capital securities to be raised; the release of the 2025 Sustainability Report; and the payment of dividends.
Although the Company believes that the expectations reflected in the forward-looking information are reasonable based on the information available on the date such statements are made and processes used to prepare the information, such statements are not guarantees of future performance and no assurance can be given that these expectations will prove to be correct. Forward-looking information should not be unduly relied upon. By their nature, these statements involve a variety of assumptions, known and unknown risks and uncertainties, and other factors, which may cause actual results, levels of activity, and achievements to differ materially from those anticipated in such forward-looking information. The forward-looking information reflects the Company's beliefs and assumptions with respect to, among other things: the applicability and stability of legal and regulatory requirements in the jurisdictions in which we invest and/or operate; the payment of fees owing pursuant to applicable contracts; certain regulatory applications being made and approved; the development and performance of technology and technological innovations; continuing collaboration with certain business partners, and regulatory and environmental groups; the performance of assets and equipment; the ability to meet current project schedules, and other assumptions inherent in management's expectations in respect of the forward-looking information identified herein.
The Company's actual results could differ materially from those anticipated in this forward-looking information as a result of, among other things: risks inherent in the performance of assets; capital efficiencies and cost savings; applicable laws and regulations and the interpretation and manner of enforcement of such laws and regulations; changes to government policies; regulatory decisions; competitive factors in the industries in which the Company operates; evolving market or economic conditions; credit risk; interest rate fluctuations; the availability and cost of labour, materials, services, and infrastructure; future demand for resources; the development and execution of projects; prices of electricity, natural gas, natural gas liquids, and renewable energy; the development and performance of technology and new energy efficient products, services, and programs including but not limited to the use of zero-emission and renewable fuels, carbon capture, and storage, electrification of equipment powered by zero-emission energy sources and utilization and availability of carbon offsets; potential cancellation, termination, default, non-compliance, or breach of contract by contract counterparties; the risk that payments owed may not be collected or received in a timely manner, or at all; risks associated with potential litigation proceedings; potential damage to our brand and/or reputation that may result from a failure to perform, or from factors outside of our control, or negative publicity related to significant projects, investments, operations or activities; the risk of operational disruptions, outages, or force majeure events; the occurrence of unexpected events such as fires, extreme weather conditions, explosions, blow-outs, equipment failures, transportation incidents, and other accidents or similar events; global pandemics; the imposition of or changes to customs duties, tariffs or other trade restrictions; geopolitical tensions and wars; risks associated with operating in international jurisdictions; and other risk factors, many of which are beyond the control of the Company. Due to the interdependencies and correlation of these factors, the impact of any one material assumption or risk on a forward-looking statement cannot be determined with certainty. Readers are cautioned that the foregoing lists are not exhaustive. For additional information about the principal risks that the Company faces, see "Business Risks and Risk Management" in the Company's Management's Discussion and Analysis for the year ended December 31, 2025.
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