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CALGARY, ALBERTA -- (Marketwire) -- 02/27/13 -- HIGHLIGHTS

--  Adjusted fleet availability was in line with our annual target of 89 to    90 per cent at 89.4 per cent for the quarter and 90.0(1) per cent for    the year--  Comparable EBITDA(2,3,4) increased to $310 million for the quarter, up    $43 million from the same period in 2011 driven by solid results from    generation and a full quarter contribution from the Solomon acquisition;    Comparable EBITDA for the full year was $1,014 million--  Operations Maintenance and Administration ("OM&A") declined 10 per cent    year over year, or $52 million, compared to our target reduction of 5    per cent--  Energy Trading delivered $13 million of gross margin in the fourth    quarter, and $3 million for the year--  Funds From Operations(3,4) increased to $205 million for the quarter, up    $16 million from the same period in 2011; Funds From Operations for the    full year were $776 million

TransAlta Corporation ("TransAlta") (TSX: TA) (NYSE: TAC) today reported 2012 fourth quarter comparable earnings of $54 million ($0.21 per share), up from $29 million ($0.13 per share) in the fourth quarter of 2011. Net earnings attributable to common shareholders for the fourth quarter of 2012 were $38 million ($0.15 per share).

The increase in comparable earnings for 2012 was driven by strong fleet availability, the addition of the Solomon acquisition and lower OM&A costs, partially offset by higher planned outages at the Alberta coal Power Purchase Arrangement ("PPA") facilities, Genesee Unit 3 and lower Energy Trading results. Fourth quarter 2012 net earnings were lower than comparable earnings primarily due to the impact of de-designation of hedges and corporate realignment charges incurred to reposition TransAlta for strategic growth.

"TransAlta's fourth quarter has shown promising gains," said Dawn Farrell, TransAlta President and CEO. "This return to more normalized results is a positive step in the right direction and a good starting point for 2013. 2012 marked a year of substantial progress for TransAlta. We have stayed the course and completed what we said we would do, including setting the fleet up for end of life and realigning the company to ensure continuous focus on operational excellence and growth. These efforts will carry forward into the future and are expected to reduce costs by approximately $25 to $30 million on an annualized basis by the end of 2013."

(1) Adjusted for economic dispatching at Centralia.

(2) EBITDA refers to Earnings before interest, taxes, depreciation and amortization.

(3) Comparable earnings (loss), comparable earnings (loss) per share, comparable EBITDA, and funds from operations, are not defined under International Financial Reporting Standards ("IFRS"). Presenting these measures from period to period provides supplemental information to help management and shareholders evaluate earnings' trends in comparison with prior periods' results. Refer to the Non-IFRS Measures section of the Management's Discussion and Analysis ("MD&A") for further discussion of these items, including, where applicable, reconciliations to net earnings (loss) attributable to common shareholders, operating income (loss), and cash flow from operating activities.