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Message from the CEO

Morgan Energy Center


Calpine Delivered Strong Financial 

Performance in 2015

Calpine has become known for delivering on its financial commitments, and I am pleased to report that 2015 was no exception.  Despite the most volatile commodity markets in recent memory, in 2015 we achieved record Adjusted EBITDA and Adjusted Free Cash Flow Per Share, successfully meeting our guidance for the year. We did this by reinforcing our commitment to our longstanding values of operational excellence, customer focus and financial discipline. I could not be prouder of the Calpine team for its efforts. 

With respect to our capital allocation program, we continue to make progress. Since October, we have balanced our expenditures between funding growth, including the acquisitions of Champion Energy and Granite Ridge Energy Center, and repaying debt, including the redemption of $120 million of our higher-interest notes. Overall, our capital allocation philosophy remains intact and will continue to include a mix of growth, share repurchases and debt reduction, the balance of which will vary over time depending upon the opportunity set. Fortunately, our strong cash flows continue to provide us with capital allocation flexibility as we consider the current environment and the opportunities it may present. 

Power markets are evolving more today than at any point since deregulation, primarily due to sustained low natural gas prices, continued subsidization of renewable generation, a growing focus on resource reliability and the proliferation of environmental regulations. This evolution has weighed upon the public equity markets as investors consider its impacts. Our message in that debate is clear: a modern, flexible and clean fleet like Calpine’s is essential in each of our markets today and will be even more so in the power generation sector of the future. As a team, we are intently focused on capitalizing on the opportunities before us. 

Looking at our 2016 financial guidance, we expect to achieve Adjusted EBITDA of $1.8 - $1.95 billion and Adjusted Free Cash Flow of $2.00 - $2.40 per share. I believe that our efforts in 2016 will further differentiate Calpine from the rest of the sector through the higher generation levels we are able to achieve in low gas price scenarios, the unparalleled quality of our assets which are capable of serving our markets for decades to come and the exercise of financial discipline. (Click here to read Calpine’s 2015 Annual Report.)


Thad Hill,
President and CEO