TransAlta Corp, the Alberta power generator, cut its quarterly dividend by more than a third to save money as it transitions toward gas and renewable power generation and away from coal.
The quarterly dividend was cut to 4 cents a share from 18 cents previously, the company said in a release Thursday. Calgary-based TransAlta doesn’t expect to raise equity this year as the reduced dividend will “strengthen its balance sheet.” The utility plans to raise debt to fund US$400 million of obligations maturing in 2017.
“The actions we are taking today are prudent and proactive steps that will maximize our long-term financial flexibility,” Dawn Farrell, chief executive officer, said in the release. “We are taking action now to ensure we can manage our transition from a position of strength.”