Avista(AVA) - 2025 Q2 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Consolidated earnings for Q2 2025 were $1.15 per diluted share, down from $1.20 in Q2 2024, reflecting a decrease of approximately 4.17% [4] - Year-to-date results for Avista Utilities showed earnings of $1.25 per diluted share, representing a nearly 7% increase over the same period in 2024 [5] - Consolidated earnings were impacted by valuation losses of $0.12 per diluted share in Q2 2025, primarily due to investments in clean technology focused funds [11][12] Business Line Data and Key Metrics Changes - Avista Utilities' performance remained strong, supported by constructive regulatory outcomes and diligent cost management [11] - The company expects capital expenditures of $525 million in 2025, with a projected total of nearly $3 billion from 2025 to 2029, indicating an annual growth of 56% [16][17] Market Data and Key Metrics Changes - The clean energy sector faced headwinds, affecting consolidated earnings performance in Q2 2025 [5] - Valuations within the clean technology investment portfolio were significantly impacted by shifts in public policy and market sentiment [6][12] Company Strategy and Development Direction - The company is focused on serving customers and communities while ensuring reliable energy provision, as evidenced by the issuance of an RFP for 100 to 425 megawatts of generation [7] - The RFP process received over 80 bids, including various resource options such as wind, solar, and natural gas, indicating a broad approach to meeting future energy needs [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about future opportunities, particularly in relation to large load customers, with over 3,000 megawatts of requests in the pipeline [9] - The company confirmed its consolidated earnings guidance for 2025, expecting a range of $2.52 to $2.72 per diluted share, with Avista Utilities contributing toward the upper end of $2.43 to $2.61 per diluted share [18][19] Other Important Information - The company has available liquidity of $106 million under its committed line of credit and $42 million under its letter of credit facility as of June 30 [17] - S&P removed the negative watch from the company's credit rating, indicating strength in its balance sheet and business plans [18] Q&A Session Summary Question: Characterization of the 3,000 megawatts of large load in discussions - The 3,000 megawatts in the pipeline includes a variety of load types, not limited to data centers or high-tech manufacturing, and the RFP responses will help inform these discussions [25][26] Question: Potential for exit or monetization opportunities in other businesses - The company is analyzing its non-regulated businesses and considering moderation of budgets while maintaining strategic benefits from clean technology investments [28][30] Question: Outlook for wildfires in the region - Fire activity has been above normal, but the company has not seen significant starts in August and is employing mitigation tactics to minimize risks [42][44]