OGE Energy (US:OGE)2023-02-23 00:22Financial Performance - OG&E's total electric operating revenues for 2022 were $3,375.7 million, a decrease of 7.6% compared to $3,653.7 million in 2021[36]. - System sales in 2022 reached 30.0 million MWh, representing an 8.3% increase from 27.7 million MWh in 2021[33]. - The electric energy sold in 2022 was 31.1 million MWh, up from 29.3 million MWh in 2021[36]. - OGE Energy targets a consistent growth of earnings per share of 5% to 7% at the electric company, supported by strong load growth and low customer rates[29]. Customer Base - In 2022, OG&E served approximately 889,000 customers, with residential customers accounting for 756,751[31]. Generation and Energy Mix - OGE Energy's generation (exclusive of station use) decreased to 13.6 million MWh in 2022 from 16.3 million MWh in 2021[36]. - OG&E's generation mix in 2022 consisted of 60% natural gas, 30% coal, and 10% renewable energy sources[51]. - OG&E's total generation capability is 7,240 MWs, with 67.7% from natural gas and 21.2% from coal[55]. Fuel and Supply Management - The weighted average cost of fuel in 2022 was 5.480 cents per kilowatt-hour, a decrease from 6.833 cents in 2021[53]. - OG&E has coal supply agreements covering 100% of its expected coal requirements for 2023 through 2025 for its Sooner and River Valley facilities[58]. - In 2022, OG&E purchased 3.1 million tons of coal from sub-bituminous suppliers and 0.011 million tons from bituminous suppliers[58]. - The company expanded its natural gas storage capacity in 2022 by entering into two storage service contracts to protect against price volatility[56]. Dividend and Payout Strategy - The company aims for a dividend payout ratio of 65% to 70% over the next five years[29]. Safety and Employee Engagement - OGE Energy was named the 2 Best Employer in Oklahoma for 2022, highlighting its commitment to employee safety and well-being[66]. - OGE Energy has reduced its 5-year averages for OSHA recordable injuries by 73% and its Days Away, Restricted, Transfer Rate (DART) by 78% since the 2011 baseline[75]. - The company aims for zero safety incidents annually and has implemented extensive training on safety culture[72]. - OGE Energy's employee engagement surveys are used to gather feedback and enhance employee engagement based on survey results[71]. Diversity and Workforce Development - The company is focused on diversity, with an upward trend in hiring members from gender, racial, and ethnically diverse communities over the past three years[77]. - OGE Energy has established partnerships with educational institutions to create talent pipelines for recruitment[68]. - The company engages in ongoing succession planning discussions to address workforce turnover due to retirements expected in the next five to ten years[70]. Risk Management and Financial Oversight - OGE Energy's Risk Oversight Committee, which includes the Chief Financial Officer, is responsible for managing significant risk management activities and reports periodically to the Audit Committee[277]. - The Registrants manage interest rate exposure primarily related to variable-rate debt and commercial paper, with no current intent to utilize interest rate derivatives[279]. - The fair value of the Registrants' long-term debt is based on market prices and current rates for similar issues, with a focus on managing interest rate exposure[280]. Debt Management - OGE Energy has a fixed-rate debt principal amount of $500.0 million with a weighted-average interest rate of 0.703%[281]. - The variable-rate debt principal amount is $50.0 million with a weighted-average interest rate of 5.375%[281]. - OG&E's fixed-rate debt principal amount is projected to reach $3,894.3 million by 2027, with a weighted-average interest rate decreasing to 3.980%[281]. - The variable-rate debt principal amount for OG&E is expected to be $135.4 million with a weighted-average interest rate of 3.840%[281]. - A hypothetical change of 100 basis points in the underlying variable interest rate incurred by OG&E would change interest expense by $1.4 million annually[282].