Eversource(US:ES)2023-05-04 16:00Financial Performance - Eversource Energy reported a net income of $491.2 million, or $1.41 per share, for Q1 2023, compared to $443.4 million, or $1.28 per share, in Q1 2022, reflecting a year-over-year increase of 10.5% in net income[181]. - Eversource's operating revenues for Q1 2023 were $3,795.6 million, an increase of $324.3 million (9.3%) compared to Q1 2022[259]. - Net income attributable to common shareholders for Q1 2023 was $491.2 million, an increase of $47.8 million (10.8%) from $443.4 million in Q1 2022[259]. - Total operating expenses for Q1 2023 were $3,046.0 million, up by $237.8 million (8.5%) from $2,808.2 million in Q1 2022[259]. - Eversource paid cash dividends of $229.4 million in Q1 2023, an increase from $213.9 million in Q1 2022[203]. Cash Flow and Debt Management - Cash flows from operating activities were $69.2 million in Q1 2023, a significant decrease from $371.9 million in Q1 2022[181]. - The company issued $1.55 billion in new long-term debt while repaying $400 million of long-term debt in Q1 2023[181]. - Eversource's cash and cash equivalents decreased to $36.0 million as of March 31, 2023, down from $374.6 million as of December 31, 2022[192]. - The company expects future operating cash flows, along with existing borrowing capacity, to be sufficient to meet working capital and capital investment requirements[191]. - As of March 31, 2023, Eversource Parent's commercial paper borrowings outstanding were $1,048.0 million, with an available borrowing capacity of $952.0 million and a weighted-average interest rate of 5.22%[195]. Capital Expenditures - Eversource invested $977.1 million in property, plant, and equipment in Q1 2023, up from $764.6 million in Q1 2022, indicating a 28% increase in capital expenditures[181]. - Eversource's consolidated capital expenditures in Q1 2023 were $789.2 million, up from $685.6 million in Q1 2022, including $42.9 million for IT and facilities upgrades[211]. - Total electric transmission capital expenditures for Q1 2023 were $246.8 million, compared to $230.5 million in Q1 2022, with projects aimed at improving grid reliability and integrating renewable energy[212]. - Total distribution capital expenditures in Q1 2023 were $499.5 million, compared to $401.4 million in Q1 2022, reflecting investments in aging infrastructure and load growth[214]. - The company expects to incur approximately $235 million in additional capital expenditures for ongoing transmission upgrades in Massachusetts[213]. Segment Performance - The electric distribution segment's earnings increased by $24.6 million in Q1 2023, primarily due to higher revenues from a rate design change and a base distribution rate increase[183]. - The electric transmission segment's earnings rose by $6.6 million in Q1 2023, driven by a higher transmission rate base from ongoing infrastructure investments[184]. - The natural gas distribution segment's earnings increased by $6.3 million in Q1 2023, attributed to base distribution rate increases and lower operations and maintenance expenses[185]. - Eversource's electric distribution revenues for Q1 2023 were $202.3 million, while natural gas distribution revenues were $117.6 million[263]. - Electric distribution revenues increased by $28.9 million for the three months ended March 31, 2023, compared to the same period in 2022, primarily due to a rate design change and a base distribution rate increase[266]. Offshore Wind Investments - Eversource's total equity investment in its offshore wind business increased to $2.16 billion as of March 31, 2023, up from $1.95 billion at the end of 2022[220]. - Eversource expects to invest between $1.4 billion and $1.6 billion in its offshore wind business in 2023, with total investments projected between $2.1 billion and $2.4 billion from 2024 to 2026[233]. - The Revolution Wind project has a capacity of 400 MW with a fixed price contract at $98.43 per MWh for 20 years, while the Sunrise Wind project has a capacity of 924 MW at $110.37 per MWh for 25 years[222]. - Eversource is conducting a strategic review of its offshore wind investments, potentially leading to a sale of its 50% interest in the partnership with Ørsted, expected to conclude in Q2 2023[221]. - The expected in-service date for the South Fork Wind project is by the end of 2023, while Revolution Wind and Sunrise Wind are projected to be in service by 2025[232]. Regulatory and Market Conditions - Eversource anticipates a decrease in energy supply retail rates for the second half of 2023 compared to the first half, with new rates effective July 1, 2023, for CL&P and NSTAR Electric, and August 1, 2023, for PSNH[251]. - The estimated annual impact on Eversource's after-tax earnings from the potential elimination of the RTO ROE incentive is approximately $18 million[248]. - The federal permitting process for Revolution Wind and Sunrise Wind is expected to conclude with final approvals in Q4 2023[226]. - Eversource recorded a reserve of $39.1 million related to FERC ROE complaints as of March 31, 2023, reflecting the difference between billed rates and a 10.57% base ROE[237]. - A change of 10 basis points to the base ROE would impact Eversource's after-tax earnings by approximately $3 million for each of the four 15-month complaint periods[244]. Operational Metrics - Electric sales volumes decreased by 5.9% to 12,198 GWh in Q1 2023 compared to 12,965 GWh in Q1 2022[260]. - Firm natural gas sales volumes fell by 12.7% to 59,783 MMcf in Q1 2023 from 68,518 MMcf in Q1 2022[260]. - Retail electric sales volumes decreased by 8.8% for CL&P, 3.7% for NSTAR Electric, and 4.6% for PSNH for the three months ended March 31, 2023[286]. - Operations and Maintenance expense decreased by $17.8 million for the three months ended March 31, 2023, compared to the same period in 2022, due to reductions in various non-tracked costs[275]. - Interest expense increased by $44.6 million for the three months ended March 31, 2023, compared to the same period in 2022, primarily due to new debt issuances and increased interest on short-term notes payable[280].