ALTAGAS REPORTS STRONG 2021 RESULTS
AltaGas Delivers Strong 2021 Financial Results and Remains Focused on Executing its Long-term Strategic Plan.

CALGARY, AB, March 4, 2022 /CNW/ - AltaGas Ltd. ("AltaGas" or the "Company") (TSX: ALA) today reported fourth quarter and full year 2021 financial results and provided an update on the Company's operations.

HIGHLIGHTS

(all financial figures are unaudited and in Canadian dollars unless otherwise noted)

Normalized EPS1 was $0.38 in the fourth quarter and $1.78 for the full year in 2021 while GAAP EPS2 was $(0.56) in the fourth quarter and $0.82 for the full year in 2021. Full year normalized EPS increased 25 percent year-over-year and was in the upper end of the Company's April 2021 increased guidance range of $1.65 - $1.80.
Normalized FFO per share1 was $1.03 in the fourth quarter and $4.28 for the full year in 2021 while GAAP FFO3 per share was $(0.56) in the fourth quarter and $2.64 for the full year in 2021. Normalized FFO per share increased 19 percent year-over-year in 2021 and continued to provide the foundation to fund AltaGas' significant organic growth opportunities and increase returns of capital to shareholders over the long-term.
Normalized EBITDA1 was $341 million in the fourth quarter and $1.490 billion for the full year 2021 while income before taxes was $(162) million in the fourth quarter and $446 million for the full year in 2021. Full year normalized EBITDA increased approximately 14 percent year-over-year and was slightly below the mid-point of the Company's April 2021 increased guidance range of $1.475 billion - $1.525 billion.
The Midstream segment reported normalized EBITDA of $102 million in the fourth quarter and $734 million for the full year in 2021 while income before taxes in the segment was $(151) million in the fourth quarter and $242 million for the full year in 2021. This included AltaGas exporting 76,609 Bbls/d of liquified petroleum gas (LPG) to Asia during the fourth quarter of 2021 while the Company's average 2021 LPG exports were relatively in line with its 90,000 Bbls/d target, despite logistical challenges during the fourth quarter due to the devastating impacts of the west coast flooding.
The Utilities segment reported normalized EBITDA of $238 million in the fourth quarter and $771 million for the full year of 2021 while income before taxes in the segment was $64 million in the fourth quarter and $538 million for the full year in 2021. The Utilities segment continued to focus on modernizing its network to enhance safety and reliability and provide other long-term benefits to our customers. As part of this focus, AltaGas increased the company's 2021 average rate base by approximately 8 percent year-over-year to approximately US$4.7 billion.
As a result of the ongoing legal and regulatory challenges on the Mountain Valley Pipeline (MVP), AltaGas recorded a pre-tax provision on its equity investments in the project by approximately $271 million ($209 million after-tax) in the fourth quarter of 2021, bringing the carrying value in-line with AltaGas' US$352 million cost cap.
AltaGas' subsidiary WGL issued US$200 million of 2.98 percent 30-year senior unsecured notes on December 15, 2021, and AltaGas issued $300 million of 5.25 percent fixed-to-fixed rate subordinated hybrid notes at AltaGas on January 11, 2022, with plans to redeem its higher cost Series K Preferred Shares. The latter issuance and redemption plans continue to reduce the Company's long-term financing costs while staggering and extending maturities and de-risking its capital structure.
AltaGas released its 2021 ESG Report on December 15, 2021, which included a number of sustainability goals within the core areas of climate, diversity and inclusion, and safety. These were meaningful steps to mark AltaGas' progression along the path of continuous improvement.
AltaGas has agreed to sell an interest in certain Midstream processing facilities to a customer for total consideration of approximately $234 million. The transaction is expected to close in the second quarter of 2022.
Subsequent to quarter-end, AltaGas closed the sale of the 60 MW Goleta stand-alone energy storage development project and entered an agreement to sell the 70 MW combined cycle Brush II power plant. The divestitures are continuations of AltaGas' ongoing efforts to streamline the platform and exit non-core assets.
The Company announces the planned retirement of Terry McCallister from the Board effective April 1, 2022.
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1 Non-GAAP measure; see discussion and reconciliation to US GAAP financial measures in the advisories of this news release or in AltaGas' Management's Discussion and Analysis (MD&A) as at and for the period ended December 31, 2021, which is available on www.sedar.com. 2. GAAP EPS is equivalent to Net income applicable to common shares divided by shares outstanding. 3. GAAP FFO per share is equivalent to funds from operations divided by shares outstanding.

CEO MESSAGE

"We are extremely proud of the financial performance that we delivered over 2021" said Randy Crawford, President and Chief Executive Officer. "Normalized EPS increased 25 percent and normalized EBITDA increased approximately 14 percent year-over-year with results achieving the increased guidance ranges that we announced in April. This is a testament to our diversified business model that continues to demonstrate the strong advantages that have been shown throughout market cycles and operating environments.

"Our Midstream platform delivered a very strong year, despite the large challenges associated with the devastating floods in British Columbia and Washington state during the fourth quarter. We continued to build on the momentum that has been demonstrated since 2019 through robust LPG export growth, exceeding our cost synergy targets at Petrogas, and continuing to fill latent capacity across the platform. During the quarter, we increased our fractionation and liquids handling volumes by 37 percent year-over-year and our gathering and processing volumes by 9 percent year-over-year, clearly demonstrating the advantage of our industry-leading footprint in Northeastern B.C. With the logistical challenges associated with the flooding in the fourth quarter behind us, the platform is well-positioned to achieve our 2022 export target of 97,000 Bbls/d.

"Our regulated Utilities delivered a solid performance, despite warmer than normal weather and unfavorable foreign exchange. Normalized EBITDA was up six percent on a year-over-year basis in U.S. dollar terms in the fourth quarter of 2021. Our continued investment in Accelerated Pipeline Replacement (ARP) has resulted in a 23 percent and 13 percent reduction in leaks since 2019 and 2020, respectively, and reiterates the improved safety and reliability of our system and drive to deliver better long-term customer outcomes. The decision in the third quarter to change our customer call center provider at Washington Gas and the corresponding integration into our operations caused some temporary challenges and transition costs but has produced meaningful improvements in customer service metrics and we will focus on delivering continuous improvements in those metrics.

"We continue to believe in the role, benefits, and reliability that responsibly sourced natural gas will provide to our customers as we embrace the energy evolution and the alternative fuels of the future. Given the recent geopolitical upheaval, and the corresponding impact on energy availability and costs, I am proud of the role that AltaGas is playing in supporting North American energy independence and our ability to export affordable butane and propane to the world."

CHAIR MESSAGE ON BOARD RETIREMENT

"On behalf of the Board of Directors and all our stakeholders, I want to thank Terry McCallister for his substantial contributions during his long tenure with the organization" stated Pentti Karkkainen, Chair of the Board of AltaGas. "Terry was a senior leader within WGL for nearly two decades, including being Chairman and Chief Executive Officer from 2009 until his retirement in 2018. He has been a valued member of the AltaGas Board since the WGL acquisition and will be missed across the organization."

Following Mr. McCallister's planned retirement, AltaGas' Board will be comprised of ten directors.

RESULTS BY SEGMENT
Normalized EBITDA1
Three Months Ended December 31 Year Ended December 31
($ millions) 2021 2020 2021 2020
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