Eversource(ES) - 2025 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - The company recognized a net after-tax non-recurring charge of $75 million, or $0.20 per share, related to offshore wind liability, which increased the estimated liability for future payments to GIP by approximately $285 million, offset by $210 million of tax benefits [16][17] - GAAP earnings for Q3 were $0.99 per share, compared to a loss of $0.33 per share in the same quarter last year, while non-GAAP recurring earnings were $1.19 per share, up from $1.13 per share year-over-year [17][18] Business Line Data and Key Metrics Changes - Electric transmission earnings increased by $0.01 per share due to higher revenues from continued investment in the transmission system [18] - Electric distribution earnings rose by $0.03 per share, reflecting distribution rate increases in New Hampshire and Massachusetts [18] - Natural gas segment earnings improved by $0.04 per share, primarily due to base distribution rate increases in Massachusetts [18] - Water distribution earnings decreased by $0.02 per share due to higher O&M and depreciation expenses [19] Market Data and Key Metrics Changes - Year-to-date weather-normalized load growth was reported at 2%, with a peak of over 12 gigawatts experienced this summer, the highest since 2013 [11] - The company is on track to invest nearly $5 billion in transmission and distribution infrastructure this year [9] Company Strategy and Development Direction - The company is focused on executing key strategic initiatives to drive sustainable growth and strengthen its balance sheet [4] - There is a strong emphasis on infrastructure investments to maintain a reliable and resilient grid, accommodating new sources of generation to meet increasing electric demand [6][10] - The company is pursuing numerous transmission projects to address evolving electric demand and improve regional reliability [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the constructive shift in Connecticut's regulatory landscape, which is expected to facilitate collaboration on regulatory initiatives [5][7] - The company aims to deliver reliable, sustainable energy while keeping costs manageable and partnering with customers to ensure affordability [14] - The company reaffirmed its 2025 recurring earnings per share guidance to a range of $4.72-$4.80, with a longer-term EPS growth rate of 5%-7% [25] Other Important Information - The company has made significant progress on the Revolution Wind project, with Ørsted reporting that 52 of the 65 turbines are installed [67] - The company is actively working on storm cost recovery, with 98% of deferred storm costs either under review or already in rates [24] Q&A Session Summary Question: Update on Yankee Gas and alternative resolution - Management indicated that the decision from PURA was better than the draft decision, and they will provide more information later [32][33] Question: NSTAR Gas PBR proposal denial - Management explained that the denial was due to a roll-in of GSEP and indicated plans to file a general rate case if necessary [36] Question: Regulatory updates and credit agency views - Management noted that credit agencies are in a wait-and-see mode regarding regulatory outcomes [42] Question: Land acquisition strategy - Management clarified that land acquisitions are for their own regulated business and strategic energy injection [60] Question: Timing for storm cost securitization resolution - Management expects a decision on storm cost securitization in the second or third quarter of the following year [71] Question: Tax rate expectations - Management anticipates the tax rate to be in the low 20% for the current year, moving towards a more normal level in 2026 [91] Question: Completion of Revolution Wind project - Management reported significant progress and expects to improve the project schedule [67] Question: End of the Revolution Wind project agreement with Ørsted - Management stated that the end of the agreement will be at the Commercial Operation Date (COD) [100]