Financial Data and Key Metrics Changes - The company's Q3 2022 consolidated revenue was $666.7 million, up from $528.6 million in Q3 2021, representing a year-over-year increase of approximately 26% [19] - Adjusted EBITDA for Q3 2022 was $276.1 million, a 10% increase from $252 million in the same period last year [19] - Adjusted net earnings decreased to $73.5 million from $97.6 million year-over-year, primarily due to a $23.3 million increase in interest expense [19][20] - Adjusted net earnings per share for Q3 2022 was $0.11, down from $0.15 in the prior year [20] Business Line Data and Key Metrics Changes - The regulated services group reported an operating profit of $229.3 million, an increase of 17% from $195.7 million in the same quarter last year, driven by the acquisition of Liberty New York Water and new rate implementations [21] - The renewable energy group had an operating profit of $71.5 million, relatively flat compared to the previous year, with existing facilities contributing approximately $4 million offset by higher costs from Texas Coastal Wind Facilities [22] Market Data and Key Metrics Changes - The company is experiencing pressure from rising interest rates and capital market volatility, impacting its growth initiatives [8][9] - Approximately 22% of the company's consolidated debt is subject to variable interest rates, with a potential $16 million annual impact from a 100 basis point increase [25] Company Strategy and Development Direction - The company is focused on three strategic pillars: growth, operational excellence, and sustainability, with a commitment to reducing reliance on raising equity [9][30] - The pending acquisition of Kentucky Power Company is expected to close in January 2023, with a revised purchase price of approximately $2.6 billion [10][28] - The company is actively pursuing asset recycling opportunities to finance its growth, having signed an inaugural asset recycling transaction expected to generate approximately $278 million [24][29] Management's Comments on Operating Environment and Future Outlook - Management described the current operating environment as challenging due to higher interest rates and project delays, but remains optimistic about long-term growth in regulated and renewable sectors [8][27] - The company expects adjusted net earnings per share for 2022 to be in the range of $0.66 to $0.69, reflecting pressures from interest rates and project timelines [26] Other Important Information - The company released its 2022 ESG report, highlighting progress in diversity, equity, and inclusion, as well as third-party verification of emissions data [15][16] - The Inflation Reduction Act has reinforced the company's strategy to invest in renewable assets by increasing tax credit levels [13] Q&A Session Summary Question: Does the new EPS guidance range include the $55 million to $60 million gain on the asset sales? - Yes, it does [31] Question: Will most of the $2.1 billion available liquidity be allocated towards the closing of the Kentucky Power Acquisition? - Yes, liquidity is expected to be in the range of $2.5 billion as the year ends, with credit facilities used to fund the transaction [32] Question: Is equity on the table at current valuation levels? - The company aims to reduce reliance on equity markets and is confident in continuing asset recycling to fund growth [35][36] Question: Are there pressures on asset prices due to rising rates? - Despite rising interest rates, there remains robust interest in renewable assets from long-term investors [41][43] Question: What are the plans for capital recycling next year? - The company is in planning stages and will provide more details at the Investor Day [50] Question: What are the key priorities for the Kentucky business next year? - The company plans to file an Integrated Resource Plan (IRP) in early 2023 to outline its service strategy for Kentucky [54]

Financial Data and Key Metrics Changes - Q2 adjusted EBITDA was $289.3 million, an 18% increase year-over-year from $244.9 million [6][21] - Q2 adjusted net earnings per share was $0.16, compared to $0.15 in the prior year, representing a 7% increase [6][23] Business Line Data and Key Metrics Changes - The regulated services group reported operating profit of $185.9 million, up 15% from $161.1 million in the same quarter last year [21] - The renewable energy group reported operating profit of $117.9 million, a 22% increase from $97 million in the same quarter last year [22] Market Data and Key Metrics Changes - The acquisition of Liberty New York Water added approximately 45% of total customer connections and 15% of regulated business EBITDA [8] - The company is in discussions regarding the acquisition of Kentucky Power, with expectations to close in the second half of 2022 [10][28] Company Strategy and Development Direction - The company focuses on three strategic pillars: growth, operational excellence, and sustainability [7] - A five-year capital plan of $12.4 billion is in place, with a significant portion aimed at organic growth [7][24] - The company is actively pursuing renewable energy projects, including a 175-megawatt facility in Saskatchewan and various solar projects [11][13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to close the Kentucky Power transaction despite regulatory challenges [10][36] - The company anticipates benefits from the Inflation Reduction Act of 2022, which could enhance investment opportunities in renewable energy [31][32] Other Important Information - The company achieved a Baa2 long-term issuer rating from Moody's, which is expected to broaden access to debt capital markets [25] - The company reported a 15% improvement in greenhouse gas emissions intensity compared to the previous year [18][19] Q&A Session Summary Question: Progress on the sale of Kentucky Power - Management is working closely with AEP to resolve inconsistencies in regulatory orders and remains confident in closing the transaction in the second half of 2022 [36] Question: Contribution from the RNG acquisition - The RNG project is seen as a learning opportunity, with expected contributions of approximately 500 MMBtu per day once fully operational [39] Question: Update on renewable asset sales - Strong interest from financial players in long-lived, well-contracted sustainable infrastructure has been observed, with management presentations ongoing [43]

Financial Data and Key Metrics Changes - Q3 adjusted EBITDA was $252 million, a 27% increase year-over-year from $197.9 million [8][26] - Q3 adjusted net earnings per share were $0.15, consistent with the previous year [8][30] - Operating profit from regulated services was $195.8 million, up from $146.1 million in the same quarter last year [26][27] Business Line Data and Key Metrics Changes - Regulated services group saw improved operating profit due to contributions from BELCO and Nasal, as well as new rates implemented at various systems [26][27] - Renewable Energy Group reported a Q3 operating profit of $72.5 million, an increase of about 8% from $67.1 million in the same quarter last year [29] - Production from existing power generation facilities was 7.3% lower than the same quarter last year, primarily due to lower wind resources [29][30] Market Data and Key Metrics Changes - The company did not experience material negative impacts from COVID-19 this quarter, contrasting with a $0.01 impact on earnings per share in Q3 of the previous year [9][28] - The company is closely tracking rising gas prices as winter approaches, expecting energy costs to increase [22][23] Company Strategy and Development Direction - The company is focused on three strategic pillars: growth, operational excellence, and sustainability [10][39] - The acquisition of Kentucky Power Company is expected to increase the regulatory business mix to nearly 80% of the portfolio [11][12] - The company aims to transition existing fossil fuel generation to renewables, reinforcing its role in the low carbon economy [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the acquisition of Kentucky Power and its potential to be accretive to adjusted net earnings per share in the first full year of ownership [12][34] - The company remains committed to achieving net-zero emissions by 2050, supported by a strong decarbonization track record [24][25] - Management noted that inflationary pressures have been observed, but they have been able to preserve project returns through higher off-take pricing [48][49] Other Important Information - The company has passed over 615 days without a lost-time injury across its North American business [21] - The company plans to maintain Kentucky Power's headquarters in Ashland and develop constructive relationships in the local community [20] Q&A Session Summary Question: Plans to finance the Kentucky acquisition and potential asset sales - Management indicated that asset recycling would likely focus on the renewable side of the business, potentially involving orphan assets or opportunities to bring in low-cost capital [44] Question: Supply chain and inflationary pressures - Management acknowledged some inflationary pressures of 5% to 10% on construction costs but noted that many contracts are fixed price [48][49] Question: Improving ROEs and low-hanging fruit - Management discussed various mechanisms to improve ROE, including utilizing forward test years and addressing disallowed costs [52] Question: Greening the fleet at Kentucky Power - Management indicated that solar has better resource availability and economics in Kentucky, with plans to explore renewable options [54] Question: Capacity requirements for Kentucky Power - Management confirmed that Kentucky Power has several sources for its load and expects to procure lower-cost energy from the grid after the Rockport contract expires [58] Question: Rate increase request for BELCO - Management noted that increased fuel prices and costs during the pandemic are key drivers of the rate increase request [62] Question: New York American Water acquisition - Management expressed confidence in the acquisition process and the alignment of parties involved [80] Question: Future partnerships and growth levers - Management discussed the transition to a new financial partner for development and construction financing, indicating a streamlined approach moving forward [82] Question: Cost inflation and PPA pricing - Management confirmed that discussions for the next phase of renewable projects are progressing well despite inflationary pressures [88]

Algonquin Power & Utilities Corp. (NYSE:AQN) Q2 2021 Earnings Conference Call August 13, 2021 10:00 AM ET Company Participants Amelia Tsang - VP, IR Arun Banskota - President and CEO Arthur Kacprzak - CFO Johnny Johnston - COO Conference Call Participants Sean Steuart - TD Securities Rupert Merer - National Bank Nelson Ng - RBC Capital Markets Ryan Greenwald - Bank of America Merrill Lynch Rob Hope - Scotia Bank Ben Pham - BMO Mark Jarvi - CIBC Naji Baydoun - IA Capital Market David Quezada - Raymond Jam ...