OGE - Earnings call transcript Q1 2022

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Operator

Good day, and thank you for standing by. Welcome to the Q1 2022 OGE Energy Corp. Earnings Conference Call. [Operator Instructions]. I would now like to hand the conference over to Jason Bailey, Director of Investor Relations. ahead. go Please

Jason Bailey

CEO; and Energy Abigail, me everyone, welcome President and I our Thank First good Quarter OGE and Chairman, our Corp.'s Sean With Bryan XXXX to Buckler, have CFO. you, Trauschke, morning, and Earnings today, Call.

of as we will being the like answer questions. always, followed we from first financial of to today, may from follow oge.com. you that and I'd is explanation will webcast an Bryan call this remind results. terms hear Sean, at In by And conference you finally, your along

addition, will that conference the In same the archived on call and slides call be accompanying website. following

Before statement call remarks. financial simply best states we now your harbor regarding direct forward-looking forward-looking to that we statements. turn I'll statements the and cannot an Sean Sean? I'd his results, our begin to for is the guarantee but This this like requirement estimate safe attention opening to financial date. for the is over to presentation, SEC

Robert Trauschke

Jason. Thank us Good for call joining thank on the you today. you, everyone, and morning,

thoughts storms with our severe week, last these impacted storms. was begin, in OG&E our live the same communities our tornadoes. by family territory round these and were number in the very impacted second families of of and we night, severe our This are a and storms Before and by service prayers multiple this businesses Many of communities.

very So support communities. we're working safely our to

share. $X.XX of we per per Earlier of gas quarter. which morning, the reported quarter the earnings to this per $X.XX operations on of natural at and holding share, of $X.XX moving share, per midstream consolidated first So includes share utility earnings company earnings $X.XX

well, know derived team that confident course a and the I proud the setting done. our the is first Less income of our we're stable investors, what weather to we The communities want accomplished customers and and guidance year. from first I'm executed for year. of was our XX% from this for you than our quarter, and are quarter in annual we've for our perspective very not

operations, benefit customer XXXX, and through upgraded our and grid continued our or XX of substations work new will For base critical transmission investments enhancement lines. XX%

we quarter, and projects. including resiliency circuit line automation XX improvements, This distribution completed

and will XX improved substations reliability technology improvements projects. growing These the last also enhancements, our grid. We X now base. experience resiliency XX% for customers improved our communication Combined distribution deliver of year's projects from and customer grid will investments these to with

received testimony Turning to rate regulatory. Oklahoma week, the Last in responsive we review.

rate provides. this transparent review, know, the and the Oklahoma you process As is and part the overall we of public appreciate Commission X

of You The of regard filing may and we settlement an with Winter commission, the have fuel does securitization formula formula Court we read fourth testimony will month. rebuttal the prior approving and in issuance rate with the with approved individual responsive the Oklahoma consistent testimony our the purchase from point this regulation, extension in process. positions Arkansas, rate the of testimony, of Supreme Oklahoma reflect the order our this costs Uri. In file On which was the later of Storm received bonds or the also approved power not associated plan. Tuesday, is and the commissioners to reviews

he our more details service terms X.X% pace on Bryan when to will coming continues load be discusses at the business track first quarter growth of We active of with at in well, the results. of on The expand XXXX. very first expect Arkansas growth by Customer the development from in have XX quarter territory. remains Oklahoma and as year. expected economic for in order commission X% an X.X% May and to to the the extension. continued continuing the the

Three territory. the expanding anticipate years. or significant megawatts low them, are Our over our are the additional between hospital couple an City systems Oklahoma driver their we in of companies to rates coming next operations of XX a growing. service affordable metro in And

Georgia consistent in Muskogee, announced load These of Additionally, Pacific new XX Oklahoma. we XX and on while makes efforts, build connected production us their incremental points to the operation another, predictable we year from a recently about megawatts manufacturing plans basis up lines XXX-acre demonstrating our QX excited of are how at new to alone, overall large one XX and ahead. stand stronger stronger growth In projects, load communities. as company support we've new

continue opportunities will our bring will to on and more investment more to We that many communities. more work load, the jobs

strong by more part up efficient. for year. of attracts turn strong utilizing the remained customers, This our helps us and the new that a this in quarter, growing Arkansas great of further a some the story We've below national well technology in us of sustainable customers. average. managing economies nation, becoming model maintain And Our attracting more business in our first rates lot with unemployment expenses revenues rates in all Oklahoma lowest by is the setting which in and accomplished supports

by issues of as supply the and we've read, all Commerce the availability has industry. Department Now across impacted U.S. reviewed chain solar panel

we capable responses to the RFP which active quick or will released a our start, batteries responding resource we turbine have solar likely combustion other solar evaluating quick RFP unavailable hydrogen XXXX. be a understanding before that are seeks technologies. flexible like Last with We the a week, resources

a IRP. include As investment our reminder, associated any plan potential with XXXX current our not investments does

supplies industries be capacity we needs, as address as impacting and process. our We pressures the you future also move through will we other materials also are we as update are Inflationary experiencing. will nimble certain and

We minimize will April, our investment unit, transfer began exiting In will energy that opportunities we our update which agile out customers. flexible to shortly. on Bryan on of with impact you and remain

we progress. each this by exit our update will Our on plan to and remains continue the majority to of you the quarter year-end, position

OG&E. sector topped research out XXX. are there of talk million a nearly and Now that energy technology at the our I of I number the about Right on devices some about to communication couple at now, a wanted of X for around system. But was doing how decade ago a talk points gave changed has ago, weeks future

Our industry is of the and most the biased, that seen. likes grid in and service argue I be have among flexible resilient not transformation, complex the electric machines would must a undergoing deliver the to reliable world but which I is customers. am our digital affordable, to we

to be deploy and increasing energy different maintain interactions. dynamic amounts we the and this in customer add security more technology smarter, technology and will means and automation both and like functions grid AI stronger, homes bright businesses, affordability. As new of must see additional renewables grid must we be Achieving and improve future and

on This technology singular We curve just scale on big while of rather investments also along past, our we're and compared making our rely and prevail, are economies functionality we in homes multitude will the to not bullish curve. not more continually for but business of bets, and is customers' technology businesses. in and uses. the technology a precision This making greater technology it requires

has and serve identifying deploy needs off employee returns. shift the that work path customer-centric teams, us across deliver process and of to better been we customer into improved believe experience satisfaction company. the a measures, impact strong this We stakeholders. in a is communication on future. we customers grow all on Our new can transform centering balance already help and This collaboration continue We're internal as customer programs improve of paying OG&E team will decisions shareholder customer communities, increased and tools in to the

So with that, I'll over the thank Bryan? call turn and you to Bryan.

Bryan Buckler

in time, On OG&E's we Jason, Sean. XXXX, growth to and start The XXXX, announced Slide X-year XXXX of that a thanks February, earnings employees reflected the the share electric plan, morning, first to increasing see I'm X% earnings XXXX. of of off per to earnings Thank this the per from outstanding our period higher reported In XXXX. rate good in share in $X.XX that to happy we're quarter increased the OG&E share the as $X.XX as well investments. same on primarily $X.XX first long-term The with Thank at across due X% through same utility the volumes per above growth capital per period in the X, XXXX. share the earnings load compared X% which in in our you was at as you to $X.XX of of everyone. we utility's to you, same sales solid reported efforts recoveries quarter guidance can compared share quarter midpoint first company, per you, to is share increase while to results. great for

trends and planned a expected, in were asset growing operation maintenance expense. favorable depreciation base revenue these partially a on by and As increase offset

Winter Flat Storm results were impacted by reminder, from first program XXXX a Bill the Uri. during As quarter Guaranteed losses

equity quarter of unrealized per first gain segment $X.XX and Our course to to was earnings XXXX. reported period tax in primarily per over same compared earnings $X.XX due reverse same period in that the increase increase operations transfer, Holdco reflected reported share of mark-to-market Midstream our the was the $X.XX XXXX. share to a of the energy per in $XXX of in a Enable. in to compared $X.XX adjustment share million primarily while in will pretax year. XXXX the per share and investment other The million earnings Natural due consolidating of on The $XX Gas

our on and Slide to economic X. indicators Turning load results

economies in The in data XX again with load were the strong results, at and reflected be strength Oklahoma unemployment the a months slide. on expectations. continues local was our quarter shown Arkansas to in which as economies the in increase the growth customer first Our with a our and underlying clip nice in our of line X.X% past once continued reflected

over We X% retail between levels. to XXXX X.X% load growth continue XXXX forecast to in

connections our megawatts mentioned As our businesses continue territory load added we fourth our and service in quarter new rates Sean XXXX draw to of call, customer see in to XXX XXXX. in

growth to megawatts throughout companies first in manufacturing, expect mining example, many XX Overall, the other even industries. year. the growth load of we and from new with we and in and added in half first data the pace food connections For and including that processing grew in accelerate the the be year X.X% strength commercial to expect rate quarter, distribution of that second higher quarter sectors, alone

to move Slide briefly affirming Let's are in we February. our guidance X, where issued

share. unchanged quarter per remainder our the execution the for results XXXX $X.XX and our to solid first of Given expectations remains of strong utility $X.XX guidance at year,

typically know, and may about our of third the utility XX% fourth quarters. are earnings in you generated As second,

potential through to our XXXX utility XXXX. Regarding no our in ability our that solar in per Thus, the long-term our a as with grow to impact share capital associated not X% at are or has plan. X% panel availability reminder, confidence plan, X-year earnings guidance the IRP investments on

units sales the at transfer transactions to short-term financing company. update April million XXXX the date in above energy to and of We move price plan pretax and end and began investment XXXX. through the the February sold in reflect $XXX midstream agreement on the utilize pay Let's business the April. debt received to ET over in plan. unit Slide reinvestment premium proceeds net for These exit our our We XX.XX have X proceeds an of in for our to was XX% core holding a announced down merger when million

Storm to securitization. Uri Turning Winter

on the mentioned, bonds. approved Oklahoma week, of Sean Tuesday As this the securitization issuance of Court of Supreme

now be to If issuance completed, Commission expect occur Storm in for found XXXX, The line to X%. FFO Once to of from for to for industry. you approved have is the this summer. bond XXXX. sheets of foundation recall, and summarize, to rate one debt of to in of Oklahoma and range the our expected is the X% the XX% balance the and purchase be fuel the open OG&E we that, growth power right Uri EPS our securitization With providing we XXXX strongest To previously costs use securitization will the XX% Corporation questions. Winter your prudent. we long-term

Operator

of comes Guggenheim question line Shahriar Pourreza with first our Partners. And Instructions]. [Operator the from

Constantine Lednev

for It's Constantine quarter. great Shahriar. on here Congrats a

Robert Trauschke

Thank you, Constantine, nice you. from and hear to

Constantine Lednev

of off a with maybe more Starting broad question. a bit

the does of allocation primary some of And the the in near that options shares. the in In just looking year tail is completing terms the towards prompt term? end regular sort cash spending any of or the given kind the of the ATM are of position, at sales? CapEx equitizing capital ET allocation, proceeds from material spend forward see kind of What you're terms accelerated you sheet strong and some starting to at still sales balance

Robert Trauschke

information to proceeds on the update Yes. end question. we only value of ultimately that, that you of give our by doing let address to it's going we're we're I'll -- our we're then our our comments, to the majority may of all the around that a put be get quarterly basis. I'll to and part maximize -- we year. And take We're Constantine first expect the because stand not to updates the trade into on by want position use the some Bryan to But of look and exited belief going shareholders. ET and how of daily pressure it for units the and we

Bryan Buckler

Yes. Great.

So our debt. progress as million date And $XXX really roughly holding exiting mentioned going year we're we thanks, exit the we've as and happy on in to Sean. the started Constantine, shares we've debt. We able be ET to company made business, Holdco the of the million $XXX midstream to with to reduce we're short-term the complete the past, of with

and for those looking growth February, of -- tremendous to and we capital we're you're proceeds us to the in very plan that's So customer that we're million customers. will enhanced per an mentioned that for and then with year opportunity And looking and put to $XXX focused, Arkansas close allow state use X bring our to a we as have back going these in economies, at down years at X. Oklahoma capital

Constantine Lednev

Excellent.

there that is is on up. regulators? then new that on but the think that And potential maybe option? any traction in regulatory past. rate innings, any the as are path settle Is stakeholders done of the terms an you the to obviously, mechanisms and conversations constructs Just early the you've I it still envisioned? the proceedings, a with comments and And kind in how of of case, clears still

Robert Trauschke

Yes.

has I is table. early Nothing very everything off the It's think still process. the taken on the been still table. in

month. we the that we the case. to I our the As testimony in And mentioned, rebuttal what file received the with of we'll received testimony is very towards date end prior consistent

a have through very outcome. work early. case this it's strong I a a here have feel constructive we'll But we good so opportunity again, and And just and like to

Constantine Lednev

Perfect.

pretty up I think sums that it well.

Bryan Buckler

All right. day. Have a great

Robert Trauschke

Constantine. you, Thank

Operator

Instructions]. [Operator

Our with next Brandon Lee Mizuho. comes question from

Wayne Lee

Just quick a question.

is You of much guys mentioned you pretax that proceeds received after How tax? that million. $XXX

Bryan Buckler

yes, Brandon, net and So selling the of million, commissions. fees $XXX that's

need our a of So perspective. that's kind entirety from a when number think at you of to in transfer, investment. you that And investment energy proceeds net look about the

If based our billion in the and and course, you today, energy to of do on today's the state for to you unit would price normal ownership on going look at $X.X we've gross of area. and what your math billion taxes. transfer pay entire you're somewhere tax sold proceeds And rates interest federal $X.X that

basis of As tax a in a reminder, an have transfer energy we million. of $XXX negative area

of the So million, do can that taxes that, proceeds million when and tax your dust basis but roughly pay tax on that's normal the liability. gross you $XXX on math then settles, pay $XXX you the negative taxes a on which you

range. So of think million $X.X if the would you math in do a tax bill I $XXX billion all type see is together, gross that what you proceeds,

million. $XXX over proceeds of net So

Wayne Lee

Great.

Bryan Buckler

good Absolutely. Have day, a Brandon.

Operator

at I Sean. conference would I like now the am back showing time. this to no to further turn questions

Robert Trauschke

you, Thank Abigail. Great.

I close would load Already we and with are resilient we a this customer implemented thoughts. you to delivering growth and and call, As today's leave from in released reliable for transfer projects like benefited our and review and our key out expected and needs, year, to service continued process exit. capacity Arkansas, in report service rate begun Oklahoma, inaugural rate of in fourth address our received future our begun formula filing issued TCFD energy RFPs customers, the few

and day, of the purpose who and year communities company. I every time the life each to to so hard every And our They here accomplishments energize works other. take single earlier, our not mentioned Our same I'm many. customers, incredibly And to day investors noble this serving date are at each person we're done. as proud at

a So OGE for Corp. thank on day. you Energy the being your Have interest and in today. call great

Operator

This Thank concludes participating. call. conference you today's for

You may disconnect. now

OGE Energy (OGE) 5 May 222022 Q1 Earnings call transcript