Avista(AVA) - 2025 Q4 - Annual Results

Financial Performance - Avista Corp. reported a net income of $193 million, or $2.38 per diluted share for 2025, an increase from $180 million, or $2.29 per diluted share in 2024[1]. - Non-GAAP utility earnings for 2025 were $207 million, or $2.55 per diluted share, compared to $187 million, or $2.38 per diluted share in 2024[1]. - The company initiated 2026 non-GAAP utility earnings guidance with a range of $2.52 to $2.72 per diluted share, reflecting a decrease of $0.12 per diluted share due to a large industrial customer's early exit from procuring power[3]. - Electric utility margin increased by $20 million in Q4 2025 and $88 million for the year, driven by general rate cases and customer growth[7]. - Natural gas utility margin rose by $4 million in Q4 2025 and $18 million for the year, primarily due to general rate cases[7]. - The effective tax rate for 2025 was 11%, compared to 2% in the prior year, primarily due to a decrease in tax customer credits[14]. - The company expects non-GAAP utility earnings to grow 4 to 6 percent from the midpoint of its 2025 consolidated earnings guidance over the long term[17]. Capital Expenditures and Liquidity - Avista Utilities' capital expenditures for 2025 were $553 million, with expected base capital expenditures of $585 million in 2026[13]. - As of December 31, 2025, the company had $110 million of available liquidity under its committed line of credit[11]. Customer Base and Service Area - Avista Corp. provides electric service to approximately 429,000 customers and natural gas to 386,000 customers across a service territory of 34,000 square miles[24]. - The population served by Avista Corp. is approximately 1.5 million, indicating a significant customer base for energy services[24]. - Avista's subsidiary AERC provides retail electric service to 18,000 customers in Juneau, Alaska, expanding the company's reach[24]. Risks and Compliance - The company faces various risks, including utility regulatory risk, operational risk, and climate change risk, which could significantly impact operations and financial performance[25][26][29]. - Avista Corp. is subject to financial risks related to obtaining financing, interest rate changes, and volatility in energy commodity markets, which could affect cash flows and operational costs[34][35]. - The company emphasizes the importance of compliance with environmental laws and regulations, which could impact operational costs and service delivery[33][36]. - Avista Corp. is actively monitoring cybersecurity risks that could disrupt operations and lead to financial liabilities[30]. - The company is aware of strategic risks, including competition from alternative energy sources and changes in customer demand due to energy efficiency measures[32]. - Avista Corp. is committed to addressing external mandates related to climate change and environmental regulations, which may affect future operations and capital projects[33]. Future Outlook - The company plans to discuss future financial performance and operational strategies in an upcoming conference call scheduled for February 25, 2026[23].