FirstEnergy(US:FE)2025-10-23 14:00Financial Data and Key Metrics Changes - Third-quarter GAAP earnings were reported at $0.76 per share, an increase from $0.73 in the same quarter last year [4] - Core earnings for the quarter were $0.83 per share, compared to $0.76 in Q3 2024, with year-to-date core earnings at $2.02 per share, up 15% from $1.76 in 2024 [4][18] - The company invested $4 billion in capital for regulated utilities in the first nine months of 2025, a 30% increase compared to the previous year [4][21] - The 2025 capital investment program was increased by 10% to $5.5 billion [5] Business Line Data and Key Metrics Changes - Distribution business saw a 20% improvement in year-to-date earnings due to a $225 million annual rate adjustment in Pennsylvania and higher customer demand [19] - Integrated segment earnings improved by $0.05 per share, or 7%, primarily from formula rate investments in transmission systems [19] - Standalone transmission business earnings increased approximately 7%, driven by a strong capital investment program [19] Market Data and Key Metrics Changes - Load growth from data centers is expected to increase FirstEnergy's system peak load by 15 gigawatts, nearly 50% from 33.5 gigawatts this year to 48.5 gigawatts by 2035 [6] - Across PJM, peak load projections are forecasted to increase by nearly 48 gigawatts by 2035, representing 30% of the current peak load of 162 gigawatts [6] Company Strategy and Development Direction - The company is focused on customer-focused investments to enhance system reliability and resiliency [5][12] - An integrated resource plan was submitted in West Virginia, outlining recommendations for maintaining affordable and reliable power over the next decade [8] - The company plans to roll out a higher capital expenditure plan for the 2026 through 2030 planning period early next year [5] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about opportunities ahead, reaffirming a core earnings compound annual growth rate of 6% to 8% [5][16] - The company is advocating for changes in state leadership to address rising customer bills, particularly in deregulated states [14][62] - Management highlighted the importance of maintaining affordability for customers while pursuing significant capital investments [13][16] Other Important Information - The company expects a consolidated return on equity of 10.1%, slightly above the targeted range of 9.5% to 10% [22] - Cash from operations was reported at $2.6 billion, an increase of over $700 million compared to 2024 [23] - The company is preparing to file a multi-year rate plan in Ohio following the expected order in the base rate case [24] Q&A Session Summary Question: Discussion on West Virginia generation and capital recovery - Management explained that for a build-own-transfer scenario, capital recovery would occur during construction, with significant earnings coming once the asset is operational [28][29] Question: Rate case strategy for 2026 - Management indicated that they would follow a similar cadence as previous years, focusing on timely recovery through base rate increases [30][31] Question: Impact of increased CapEx on earnings growth outlook - Management believes the increased CapEx opportunities will solidify their ability to remain within the 6% to 8% earnings per share growth range [33] Question: Data center pipeline and transmission CapEx - Management noted that there is approximately $1 billion of CapEx associated with transmission interconnection requests due to strong data center activity [34][35] Question: Affordability pressures in New Jersey - Management acknowledged that generation costs are driving bill increases and emphasized their efforts to mitigate these impacts [51][52]