IDACORP(IDA) - 2024 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - IDACORP's diluted earnings per share increased to $5.50 compared to$ 5.14 in the previous year, marking a growth of approximately 7% [7] - The company recorded an additional tax credit amortization of $29.8 million for 2024, compared to no such amortization in 2023 [8] - Net income increased by$ 28 million compared to 2023, primarily due to higher net income at Idaho Power from a January rate increase and customer growth [32] Business Line Data and Key Metrics Changes - Customer growth for Idaho Power was strong, with nearly 650,000 customers served at the end of 2024, reflecting a 2.6% increase [12] - Total other O&M expenses rose by $61.1 million, driven by increased pension-related expenses and wildfire mitigation costs [34] - Depreciation expense increased by$ 28.1 million due to ongoing system investments [36] Market Data and Key Metrics Changes - Moody's GDP forecast for the Idaho Power service area predicts growth of 4.5% in 2025 and 3.7% in 2026, indicating a robust local economy [12] - The Idaho labor force surpassed 1 million workers for the first time in December 2024, showing strong economic activity [13] Company Strategy and Development Direction - The company plans to file another general rate case in Idaho in 2025 to collect necessary revenue for operations and ensure a reasonable rate of return [19] - IDACORP is focusing on infrastructure development to support large load customers, including ongoing projects with Meta and Micron [14][16] - The company aims to maintain affordability for customers while managing significant capital expenditures, with a forecasted average annual CapEx of $1.1 billion from 2025 to 2029 [41][48] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining earnings growth and quality, citing strong customer growth and regulatory support [31][53] - The company anticipates a potential load growth of 8.3% annually, driven by large load projects and infrastructure needs [21] - Management highlighted the importance of regulatory mechanisms to reduce lag and improve credit metrics [72] Other Important Information - The company appointed Scott Madison to the Board of Directors, bringing extensive experience in business strategy and finance [27] - Current snowpack conditions are favorable, exceeding 120% of average, which is expected to positively impact hydropower operations [28] Q&A Session Summary Question: Discussion on replenishing the ADITC mechanism - Management indicated that the process could involve including it in a general rate case request or a separate filing [65] Question: Credit metrics and conversations with rating agencies - IDACORP ended 2024 with approximately 18% cash flow preworking capital over debt, with expectations of a slight reduction in 2025 due to financing needs [68][70] Question: Opportunities for shifting to a period-end rate base framework - Management stated that all options are being explored, including the potential for a period-end rate base in future filings [77][78] Question: Incremental load growth and data center activity - Management noted strong interest from various industries, including data centers, agriculture, and manufacturing, contributing to load growth [82][85] Question: Impact of executive orders from Washington on generation mix - Management is monitoring executive orders and their potential impact on permitting and generation mix, but no immediate changes are anticipated [90][92] Question: Characterization of fourth quarter weather - The fourth quarter experienced a mix of warm and cold weather, with snow occurring unexpectedly after Thanksgiving [98] Question: Customer growth sources - Customer growth is primarily driven by large commercial and industrial customers, with modest contributions from residential in-migration [104][105] Question: Property tax refunds from litigation - The property tax refunds were related to a three-year historic period, with a pretax number of around$ 10 million recorded in 2024 [107]