AES(US:AES)2025-11-05 16:00Financial Data and Key Metrics Changes - Adjusted EBITDA for Q3 2025 was $830 million, up from $698 million in the previous year, driven by growth in renewables projects and rate-based investments in U.S. utilities [12][14] - Adjusted EPS increased to $0.75 per share from $0.71 year-over-year, influenced by similar drivers as adjusted EBITDA [12][14] Business Line Data and Key Metrics Changes - Renewables EBITDA saw a 46% increase year-to-date, primarily due to the addition of 3 gigawatts of new capacity and cost reductions [5][15] - The utilities segment reported higher adjusted pre-tax contributions driven by $1.3 billion in rate-based investments over the past year [16] Market Data and Key Metrics Changes - The U.S. backlog for renewables stands at 7.5 gigawatts, with an additional 4 gigawatts in the pipeline, all of which are safe harbored [7] - AES Indiana is positioned as one of the lowest-cost providers in Indiana and Ohio, with expectations to maintain this position post-rate case resolution [8] Company Strategy and Development Direction - The company aims to sign 4 gigawatts of new Power Purchase Agreements (PPAs) in 2025, with 2.2 gigawatts already signed and expectations for an additional 1.8 gigawatts [4] - The focus is on profitable growth with attractive returns, emphasizing fewer but larger projects in renewables [32] Management's Comments on Operating Environment and Future Outlook - Management remains confident in achieving the full-year 2025 guidance and long-term growth rates, reaffirming a 5-7% growth rate for adjusted EBITDA through 2027 [18][22] - The company is well-positioned to meet the growing demand for reliable, low-cost power due to its advanced pipeline of development projects and strong domestic supply chain [7][24] Other Important Information - The company has achieved significant cost savings, realizing the majority of a $150 million target for the year and aiming for a $300 million annual run rate by 2026 [12][17] - A partial settlement agreement was filed in Indiana, reducing the original revenue increase request by 53% [9][68] Q&A Session Summary Question: Long-term growth guidance and asset sales impact - Management reaffirmed the 5%-7% long-term growth guidance, indicating that the $400 million in EBITDA expected beyond 2027 comes from projects already in the backlog [27][28] Question: Parent funding and balance sheet capacity - The focus is on strengthening the balance sheet and maintaining investment-grade ratings, with no plans to issue equity through 2027 [32] Question: Demand acceleration in data centers - There is strong interest from data centers, with a focus on larger, more profitable projects rather than just the number of gigawatts [37][39] Question: Utility opportunities and IRP update - Advanced negotiations are ongoing for potential deals in Indiana, with expectations to announce agreements soon [45][46] Question: Powered land opportunity - The powered land solution involves co-locating data centers with renewable projects, providing a unique value proposition [48][75] Question: Renewables segment growth expectations - The renewables segment is expected to grow significantly, with adjustments made for prior year comparisons [78]