NiSource(US:NI)2024-02-21 19:10Financial Data and Key Metrics Changes - Non-GAAP net operating earnings for Q4 2023 were $239 million or $0.53 per diluted share, up from $221 million or $0.50 per diluted share in the same period in 2022, reflecting a year-over-year growth of 6% [23][70] - For the full year, non-GAAP net operating earnings increased to $716 million or $1.60 per diluted share, up from $648 million and $1.47 in 2022, indicating a 9% year-over-year growth [70][76] - The company raised its 2024 guidance to a range of $1.70 to $1.74, reflecting a 7.5% target growth for 2024 [36][73] Business Line Data and Key Metrics Changes - Non-GAAP operating income increased across gas, electric, and corporate segments, contributing to a $209 million increase in consolidated net operating earnings [49] - The company deployed approximately $3.6 billion in infrastructure projects in 2023, enhancing safety and reliability, which drove an increase of $335 million through regulatory activity [24][70] Market Data and Key Metrics Changes - The customer base grew with residential customer count increasing over 80 basis points in gas businesses and over 50 basis points in electric businesses last year, enhancing the scale of the company [71][125] - Economic development in the Midwest, particularly in Ohio, saw 33 projects with over $10 billion in investment committed in 2023, which is expected to enhance value for the company [51][71] Company Strategy and Development Direction - The company is focused on a $16 billion five-year capital expenditure plan through 2028, which includes investments in electric generation, transmission, gas modernization, and economic development [12][36] - The company aims for net zero emissions by 2040, with ongoing projects in renewable energy generation, including wind and solar facilities [19][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver strong financial growth despite challenges in the utility industry, emphasizing a resilient business model [35][78] - The company is committed to a long-term growth strategy with an expected annual EPS growth rate of 6% to 8% and annual rate-based growth of 8% to 10% from 2023 to 2028 [36][52] Other Important Information - The company achieved a 19% diverse supplier spend in 2023, up from 16% in 2022, moving towards a goal of 25% by 2025 [22] - A 6% increase in dividends was authorized by the board in January, consistent with the annual increase from the previous year [28] Q&A Session Summary Question: What is the timing for layering in renewable investments? - Management is working through the timing of layering in renewable investments methodically, with specific projects like Gibson and Fairbanks being part of the $2 billion upside CapEx plan [81][82] Question: Can you clarify the financing plan for the upside CapEx? - The financing plan will evaluate cash flow profiles of projects, with potential assistance from PTC monetization, and the company is open to using an ATM strategy for efficient capital raising [60][84] Question: What is the status of the next NIPSCO rate case? - The next electric case will be filed in alignment with the completion of renewable projects, and management is currently working on the gas case filed in October 2023 [65][95] Question: How much of the CapEx is attributed to safety and compliance? - The majority of planned gas CapEx is attributed to safety, reliability, and compliance work, with minimal amounts planned for future expansion costs [124][125]