FE - Earnings call transcript Q1 2020

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Operator

Greetings! And welcome to the FirstEnergy Corp, First Quarter 2020 Earning Conference Call. At this time all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Irene Prezelj, Vice President, Investor Relations for FirstEnergy Corp. Ms. you Thank begin. may Prezelj, you

Irene Prezelj

that current Thanks Melissa. we earnings, earnings Today based first strategies risks subject and uncertainties. actual earnings our of filings. to differ our make various our Web under the on results are will Factors link materially by and indicated SEC section statements those could revenues, our prospects. quarter can statements and Investors forward-looking cause information are in such be to and to from call. These found on site Welcome expectations statements performance, regarding

non-GAAP We will FirstEnergy also measures. the presentation GAAP discuss can with on along certain and measures non-GAAP the be which site, found financial financial supports between discussion. Web Relations Investor Reconciliations today's

include and phone on Jones, Executive call in and to join call Chief and that us will President Vice participating have Chuck Steve executives that Senior Financial are several and Officer; the the Officer. session. Chief I Q&A this as for available we we well note President Participants are in virtually Strah, all today’s other

call to will the over I Chuck. Now,

Chuck Jones

Thank morning for everyone. you, us. Irene, and joining good Thanks

have this safe hope are this questions are These you realize and numerous public how you are healthy. We of on health morning emergency We FirstEnergy. listening unprecedented all times. affects

is path the about journey and we've the see today first quarter during solid, talk to COVID-XX earnings, we review pandemic goal obviously Our our ahead. are been to also which once but again that the on

I'm taking manage actions we're business this currently to to through I'll strategy built during is of are I'll crisis. environment. in positioned these cover today's well our the the review for broader and events. Overall, navigate why believe our confident we story also resiliency we

keep everything a of considered scale means strength operations and transmission infrastructure, system fundamental safe. employees large priority and our five their our and for work is states our across do provide this number XX,XXX diversity employees, customers to and continue essential distribution help We that FirstEnergy. work. electric we maintain square our communities important critical as and is miles in need. to the operate families But one to our My energy is and First, our customers

to and than home steps the employees Minimize the to workforce health half transitioned adapt our of environment we protect taken new a and includes customers. successfully call circumstances have our as center significant of quickly remotely. more work employees moving our work XXXX the more That's employees risks, at and it We to to well. than

we've secured and keep remotely, preventative the they're them like For like by job. thermometer, regulated other companies, used help and groups. work generation surgical other plants on our work unable measures to supplies workforce being safe operated implemented We've to protective our equipment masks,

locations briefs reporting to have relocated and conducive also work and measures, social disinfecting cleaning job and distancing We sites adjusted to schedules. increased

minimize potential We with of exposure. equipment small and same have using day the the consistently exposure vehicle same crews positioned so managing what And group the our to work call are people they They're we are to the we limit same pods. and working public. with each

safety focusing We the adopt to agencies. of virus this and takes federal current of and throughout guidance part, and needs process. state continue workers, employees the our customers health meet communication on the spread health our plans our flexible consistent ongoing work the of and everyone's remain on adjusting from minimize the It and

more stronger emerge efficiently. from become country that this we has pandemic a creatively because our is our What together and for This smarter, to me learn more come to will we've defining how encourages company. work knowing moment and

earnings. the positioned will to predictable and we continue to stable impact transmission the we're economic manage And of provide fact, investments distribution and In slowdown. believe well very all our

operations our situation the our develop, the As continues and if the and of to flexibility throughout deploying diversity investments system. continue to shift capital gives scale needed us the

do disruptions. chain, a on supply our anticipate not eye significant we're close While keeping we

Since having wide the smart perspective sampling we at usage middle March, from data. of is on meter the have a system load a both and trends, from impact been of the looking early Pennsylvania pandemic

We have almost from mid-April, see load X% timeframe to mid-March wide seen system adjusted until dropped weather compared year. same the by last

residential our It's increases X% operating seen under more of also the stay than in our all expect the similar states We home residential of stay of at by We've usage increases would service Pennsylvania for territory. customers order. home across are at orders. driven rest

four prior is to remind seeing our year our compared we almost the average, recession. down load to XX% and due All I to reduced XXXX were sales the pandemic industrial industrial from to XXXX. would manufacturing commercial customer that you already

And is structures load XX% are from commercial about measure from times. decoupled come rate industrial our X% of stability our tumultuous of in our structure provide sector. from rate come about while even However, on thirds a of revenues base two total Ohio. About the XX% residential in distribution the and sales, customers

In addition, from a but tied our other energy derived isn't revenue consumption, to determinants. distribution billing directly of portion significant is base

In of are fact, charges. customer about demand industrial XX% up of of and commercial rates made and XX%

customers business. Stanek personally future are incremental of issued incremental issue. for COVID-XX our and firm recover in demonstrates I existing regulatory The through to We cost. Public and strong can that Ohio We pleased important the proactively Service deferral policy in our the writers an Chairman Maryland and in all order month Maryland, for related this rest of the on recovery for expenses authorizing uncollectible leadership also thank New Jersey. like support Commission this regulatory prudent would their commissioners

Active February, a through include the regulatory New over customers. rate seeking recovery our schedule. ALJ all and we XXXX items in in incurred we recover distribution light of few with last reliable safe associated to electric Along service issuance an storm base case Jersey procedural period. of our years, calendar soon be expect found for costs assigned will costs case the by is planning providing our the current Our increasing to with

In the provide to the the the case case. the request. the phase discuss in of discovery opportunity details the to for scheduled with date We our parties litigation parties has of favorable to the settlement begun meantime, review anticipate

We the of close to also the agreement transfer half expect approvals. to plant we first in portion Yard's that Creek transaction power LS an of reached JCP&L's to and XXXX pending

In with West balanced Virginia, generation filing Integrated Virginia requirement provide our an make updates resources The to IRP our plan to informational that and by we are have XX West reliable risk. cost a for customers adequate our and XXXX reasonably Resource December Plan.

XXXX. Maryland commitment case rate to And a finally, Potomac by smallest our a early for file utility we Edison have in

to with another closed, of our Yesterday guidance which quarter as we share, execution results, earnings range. a $X.XX per marked $X.XX quarter $X.XX earnings of the fully regulated Moving which GAAP solid per our is company. a of along operating reported first of midpoint share, now after market above

by which the transmission on lower expenses and revenues. to Our higher of results margin impact weather mild were helped driven offset our distribution

the detail always, drivers in more As call. in discuss the Steve later will

affirming earnings per $X.XX share guidance $X.XX of share. XXXX our to We're per

in issue We well are through to XXXX also XXXX X% of X% $XXX in equity affirming X% plan our million our and total expected CAGR as to to XXXX. to a up to XXXX X% as of extending through

to of share second addition, the guidance $X.XX $X.XX at for we're quarter In earnings XXXX. per introducing

While past the have couple of sometimes markets months. extremely the in financial been and illiquid volatile

predictable stable, be low to utility. risk a continues FirstEnergy

greater We proven in plan these to and market these cover to a capital will have asset that's detail. liquidity also risk conservative in a strong adequate access conditions probably and three outperformed billion the volatile $X.X due markets of Steve slow pension allocation.

Finally, on let me take our a discuss of succession questions this. moment been I've planning. lot to a getting

because issue. are our discussions. transition. as old Just doesn't thorough that this after succession can plans mean many started replacements as We for a been I into right know I they Board topic been plan other and any planning tell I planning I anywhere started you about became for literally I feel don't emergency on going old. yet. I What with my robust as our have has evolved our governance planning thoughtful has wondering typical CEO. key on just you of look Well,

several role, the were President Sam over broaden John distribution moving Taylor of and from organization we experience some the executives. of become role placing to a into This operations. FENOC XXXX, the included Finance designed that bringing out of In our key Utilities Belcher Steve CFO the and moves made to of into leadership

it that, year. leadership as long as good my thoughtful continuing are I team transition in said be are at and said no expect I you load my additional Board organizational anytime own They're retirement and FirstEnergy. will won't Board I what see about may and a decision But be our I have within discussions months. part of The would the having and leadership and the this willing, moves coming made

things well once your when for we of seeing many you Thank time. forward return to Stay look and you normal. to again

first will review Steve Now quarter. the

Steve Strah

today. Good morning. It's you great to speak with

reconciliations find detailed all strategic other always, As our along our quarter the highlights Web on that's and document you'll site. posted financial in information with about

let's GAAP share. reported of per our Now review We first $X.XX results. earnings quarter

position called my the and Energy pension February quarter This company, fourth after range provided status call. revisit we adjustment FirstEnergy our included we as bankruptcy was independent Harbor. recognize were of I of unaffiliated OPEB now that non-cash $XXX when at required liquidity the results was consistent GAAP will with an our in considered end adjustment earnings million Our and on comments. funding pension tax later the to Solutions mark-to-market from emerge

earnings incremental business, $X.XX the charge was earnings of revenues for Lower share, first compared we per on rider as mild decrease quarter which as distribution offset this Ohio well This is our the by mostly earnings provided well midpoint to as driven as guidance customer and above on special revenue items, revenues, Pennsylvania. In quarter first the the weather in by decoupling of last XXXX. were Adjusting impact call. Ohio were of both usage. other operating the

basis, offset revenue, also XXXX net of XXXX absence quarter higher and lower Ohio due compared to quarter depreciation First first financing to decreased distribution which expense on Customer DMR of the the costs, sales This usage earnings expenses. decreased of drove below of and degree heating actual weather of first the XX.X% compared to days approximately a XXXX. quarter the actual an first were in adjusted residential XX% in decrease quarter normal XXXX.

On last basis, year. to period decreased by the a weather compared same sales adjusted X.X%, residential

basis whether quarter see on and actual of quarter to X.X% in modest first customer XXXX. In first continue the X.X% We adjusted commercial the an compared when growth for decreased customer to class, sales count.

fourth X% to in the our period growth year. footprint. load And finally, first industrial declines gas class, compared our saw the with our major quarter other last shale Consistent sectors in in decreased sector, only with quarter, we same in

first segment, earnings related future companies to our rate results Looking to reflect our higher rate expenses. And transmission at investments in our formula program. results increased customer energizing at primarily due our the continuing quarter in the quarter business, first in primarily operating lower base

pension February in of on Last pension its for we requirements. and update to discussed market quarter, performance I'd in XX our our remark that from volatility XXXX like impact light future this of year. today funding

As in our plan and XXXX XX% of we end, of a status the funded of about reduction XXXX requirements told on quarter, fourth the resulted our the at plan our year million. in in plan performance was strong significant you investments XXXX in funding $XXX

funded $XXX remeasurement, February down and million $XXX status was for our to XXXX to $XXX down our funding million again requirements From our XXXX. and slightly. At decreased from million for $XXX XX% million

assets us about well plant allocation out total equities. XX% decision in we into mid billion cash. made Back only in public asset the of of move XXXX. equities $X nearly far served end the in assets has of conservative to held XXXX, we of XXXX, Our At so

debt seen market in to prior was X.X%. we're of assets also we related of space. was of We rate have the rates down best end refinancing S&P the ever of first virus, executed billion of when Corp good our March pension declined at successfully After call, at looking in a the a $X.XX the our to quarter, only quarter fourth at story completed but as X.X% while XX%, That blended the transaction volatility as the FE XX. utility

completed Penelec. MAIT, at and at completed financing a In April, million debt we a March, in $XXX financing $XXX we million debt

million used $X.XX billion corp February, in senior Harbor our $XXX we issuance proceeds were term The loans. $X of proceeds the refinance Energy from in used the emergence. cash to settlement on hand remaining Finally, the to their bank to note debt issuance, together from billion upon fund with final payment

Our liquidity maturities and strong. are is our position manageable

$XXX Corp, and million $XX only Edison, We have a remaining maturities debt of this million year, million including this $XXX which plan loan term to at Toledo we refinance at summer. FE

until XX facilities commercial months over are of liquidity year the next the committed $X.X and issue project We do our not approximately end liquidity We billion paper. XXXX.

many past over in the avoided months. industry by the So others two experienced we've liquidity issues

to call very your Before we're overall periods unique, very especially I'd today. volatility questions, to over but I turn in like uncertainly, is FirstEnergy's like value also extreme the and which simple, facing proposition, reiterate of

fully FirstEnergy and providing including is states, predictable five stable diversity. a low wires spans regulated, risk scale that utility and

provide margin, generated C&I utility residential distribution is lower while Our customers stem X higher from our revenue of are stability. our million our are from margin. customers, customers, which one-third revenues which only Two-thirds

When Ohio decoupling, insulates partially recessions. combined with mix from FirstEnergy this

We relationships light have across period, very through planning in And our resulting XXXX regulatory footprint. good low is in our regulatory regulatory jurisdictions. our our calendar current risk

regulatory under are pipeline minimize rates across regulated on of area We and capital $X of than return timely expenditures. riders our billion annually and and invest returns of a have that lag we those investments long More XX% provide service formula our investments. and

our from capital primarily required by changes of across or load by is and near-term very mandated to transmission which footprint. by earnings transmission, service supported in large FirstEnergy our influenced come safe, PJM customer maintain not by programs One-third reliable FirstEnergy is

BBB company agencies. targeting ratings all rating are investment from credit an We grade three

at liquidity Our adequate $X.X is billion.

these season, as by to utility is management combination, CAGR a are which In to and the of very attractive desired strong. aspires access markets that of strongly proven as support dividend sustainable remains investors. capital an all both grow, well Our true attributes

you. its finally, now your record has take track management a commitments. team proven questions. And Thank meeting of or let's our exceeding And

Operator

you. Thank

a conducting Our of the of Instructions] Bank America. be Dumoulin-Smith line Please question [Operator question. We your proceed first session. with will with from question-and-answer comes now Julien

Julien Dumoulin-Smith

then employees very Good I different come morning talk And spend executing there, plans operational all on about the capital think more team. to you reevaluate under in? CapEx? in with the Thank how are operate given that, work, operational about and second wanted especially the your might dispersed think you back to where you you situation how throw you perhaps states through the [ph] all [intensity] actually. and employees just what hope handling that Can well. the started et but your as side, follow to the to I your and can and scenarios cetera tandem about you return on do first conversation up are you how the you if CapEx across just in against having on

Chuck Jones

All right.

not I important operationally, point So and here. first, to unique Julien, is out think FirstEnergy it's

Emergency Our industry dusted couple for we MERS company This with HXNX obviously, and into every the few business of SARS has has over at years implementation. prepared continuity, a and a it decades, full time, of part that Plan. We last and pandemic been and it Ebola. off for least put Response times the

team how showed put our single an every go when They've up, time it's into stepped literally were very to they've all we tell is something of creativity, The this thought and for I'm to just isn't ingenuity. it's leadership employee. entire life this. prepare But And going about happened. advance I you, proud normal. And to we like down lot when of a

call, the remotely. and have reporting opposed have ability service working that's as even the were XXXX a the And almost pods, We are having four I in or field to quickly states positive we to as our operations PPE. to with have They going of on our very think, into operate. as and our normal, remotely, continuing several negotiated in I delivering maintained across said with coming unions one They how memorandums if all understandings materials a of employees dozen my center to five forces location attitude. work people three

as that cases XX,XXX workforce. is for working FirstEnergy a it's nine I think the we've at had employee proof

in death. where And we're One of shows cases cases work. things that the in has the resulted are think Jersey, those working. been disease unfortunately that a we've New But at doing I had zero transferred that

world going gives to want honestly that how And think to and flexibility when and to we normal mode on a this I a there's be the back very think of deliberate vaccine widespread for to this distribution I I while. normal for the stay to return is can in until don't thoughtful get operations. think we virus. us

evaluating the going new what in is to the norm So, mean we're interim.

CapEx, And our to CAGR piece being on up lined the years big your investments. interruptions the in that making energizing question of by as workforce a any most years includes because we're I ago. chain, is contracted is specific we of We now. a ago. we our But, chain investment with about that that the that many, seven those started see really don't supply worried we're guidance driven said, And right lined workforce capital we future up before done many significant supply

see we're I that I year, guidance mean, only that's but I'm track. not able this now, to CAGR. right So why worried our taking And with being off this comfortable anything our reaffirm don't about reaffirm for

Operator

you. Thank

comes question with line next Pourreza question. your proceed from of with Partners. Please Guggenheim Shar Our

Shar Pourreza

the lot New on the we're timing sense whether sort kind on procedural in as the any on this the timing think But BP COVID And a struck workload. schedule. about Jersey, from sense year for I perspective, any still just related there's a of settlement waiting with IIP. could next of challenges, we in So going a know we see of

Chuck Jones

on delayed, and But reacting I first the was think track the to soon. here Well, it get everybody on think they'll rate back bit pandemic. a this as I case, got little responding schedule

a on a that Assign anything year this outcome procedural We it with ALJ, schedule. really anyway. case get anticipating an weren't final to to happen

would this late year opportunities would will have at it'll to discussions, the settlement the think there I way along I earliest be think. happen, be that if

that guidance of in And anyway. don't I expect case rate there's don't much that in So I our XXXX. impact of just -- none

for in runs IIP. this additional the IIP as the we Jersey our the in to But on As evaluating still with that first think be customers fine think have in it. this sure the that. New going our other service operating right even plans I we're current to don't the to end going We're IIP, making through year. round. and states far capital in that any And We've going file we're I'm And do now, got of investments to not transmission I now, area. right an after we're

Shar Pourreza

trends been experienced case it's seeking the strengthen usage these may quiet, some is in of which you of obviously DISC of I latest then highlighted change the has kind of normal mean, And adequate GRC? kind new structurally for of the uncertainty, term it. you kind Pennsylvania, as because the Ohio maybe this long for you until over been macro file sort you're and Got next or decoupling in of available. as kind a

Chuck Jones

have I the don't for shareholders rate for case any working the that We reliable next generating and mechanism And fine. they're And lag. of several think plans without in a they're investment customers returns are for activity LTIP needed the generating that's years. Pennsylvania broad for and DISC type

work the So Pennsylvania things don't I see working to fine and in change I are way think it. reason any

Shar Pourreza

lot you look guys. by for old. Thanks that's the the guys. And do record, Perfect. young, very morning. a Chuck not this it was That way, Thanks,

Chuck Jones

Shar. Thanks

Operator

Thank you.

with Stephen Please line Morgan from comes proceed question your next question. Byrd Our Stanley. with

Stephen Byrd

key addressed. of did Most question. have the one I questions broader been have

there CapEx downturn, extended CapEx? If term? you for do we consideration of a be that have pay Or so going economic extended customers if handle as is severe think downturn? work think just that about just an slow. that needs we pretty the impact you plans, is to just as Is of How about longer do critical ability we XXXX. into about just, is customer ability to viewed your to economic think do have the Just very this any How recovery do done?

Chuck Jones

dozen last of Well, lot load a really our so we haven't years the exactly across over footprint seen a growth big last the since or recession. half

we is in of these we believe as customers is some thoughtful something that and do that always on infrastructure are FirstEnergy transmission But very about are need needed. I impact distribution at the cases investments we're have repair make so, investments investments. in modernization. It's The old. and these And

and the doing to that automation in customers we're think areas, our so watching adding impact a forth, constantly we're every very pretty think state it better. amongst for we're I I much and we we in that jurisdiction state and are some our it the around keeping keeping that that And out from to moving these serve way making work lowest by bills that customers moderate rates in. the in changes on

think happening the to I an we that I going And have to significantly our cause keep us adjust here see that's time. don't eye So anything plans. all on to

Stephen Byrd

just answer thoughtful that one sense. makes a last Maybe that's one. Well,

response extended sort chain, think zeroed do in gave if very at elements chain there the a if risk supply more are thorough we the If place COVID-XX good you overall? I on of shelter certain focus more impacts. of supply have in fairly on you Do just that on about we dynamic, an being the dynamic? chain supply as feel you deteriorate, or conditions

Chuck Jones

right and remarks, of prepared anything not four, in We FirstEnergy a of to us. a ago as I ago, that strategy. Buy implement years made America now, my seeing half number at decision four As a years a concerns we're said

from made American supplies. in XX% I rely short-term, bigger in We're products on in So the foreign made think whole that do American well, think from we I -- short-term there. risk -- plus buy a companies. was lot the don't And America buy the

get to spread. the back people I ways still And reopen. have see take from to this to healthy them a not to their some and introduce states temperatures. there have work are give I workforce think and work point, and PP and to going our at antibody think virus and you're maintain take steps people do experience, the testing And to bring

concerned, Right be accomplish can is that to going think I think supply our So, chain now, both. I not I'm fine. you

Operator

Thank you.

Research. with Wolfe Our Fleishman next question proceed Steve question. comes from Please with of your line

Steve Fleishman

what the on maybe what I of other how just rough like planning? of have in much virus the of assuming kind But utilities. for downturn there, in sales your the assumption sensitized economic the base baselining of a like the of So sensitivity terms or you're of lot and and just idea know just length you're a be here? using on Is question to that? -- for a compared have relatively good little low you your is from bit downturn to the And a

Chuck Jones

So here. with we're let step stay of impact an top revenues maybe decoupling XX% together residential industrial some on. that, to customer and our me on to ask up our Steve And let to the home about And, my segment, a We of reduction trying the the then is XX%. XX% answer me And to the of start Eileen XX% charges But, collected that view XX% the parts is is, in about the and additional it's in color. layer I'll then provide of charges, as Ohio, that usage orders X.X%. in the about that demand of all still X% but jigsaw commercial load. piece driving fact talked this load at and come you and said on which I from represents distribution through puzzle

delivering off I'm to be going wouldn't When that reaffirmed on you take have swing our confident us guidance, from I track in there's because, that adjusted or weather revenues that that material going are all not to put any together, guidance.

we on exceeding given years added I yet. plan five give that we've quarter can I that can the you we that you. midpoint every this, of top a one of final But you to I now in So, meeting end, just have or don't number And tell break record. don't

at be the continued after will the even So, with effect I do there think to orders lingering home begin C&I stay reduced. be

company, I our But XXXX to said, come to I with all back don't expect work as once. also, people at

at impacts So some But, of not to segment to are X% a while I the for maybe think level, some going at normal. in to continue the above residential positive X.X%.

have you you Eileen, add? want to So anything

Eileen Mikkelsen

Chuck. Thanks,

I it. think you really nailed

addition that inform would carefully. very had economic look of our only others I what in other looking thing is We Moody's continue models, that very this And on going forecast to to The spot view indicators at you and than own our to from Chuck forward. the carefully say. to add we're at

Steve Fleishman

Okay.

you're So read not the charge, that fully up but with protected, the locked up decent this, that of and it with part got of volume revenues your longer the way, demand a way things gives and work C&I a to just amount you've more my even that not people sensitive that's on is plus protection you it kind generally that deal of if think. extends than locked

Chuck Jones

add, Yes. isn't which of a transmission, comes I'll it third from Steve said dependent. And that load

Operator

you. Thank

line question with question. proceed next Our from comes Fishman of Charles Morningstar. Please with your

Charles Fishman

your jurisdiction. load, reset like follow-up How next -- does a doesn't basis typically, How where that that fixed an X, even would reset it that demand though charge component? you a on impact or this On so rates? C&I charge? back you on of got Slide cuts to commercial that good industrial customer XX% on you if does fixed But you last question. numerous annual I'd XX% realizing impact year portion does on year, that demand fixed a is like a show of that rate typically is

Chuck Jones

component fixed month. basically that the something is every For resets

based bill on So the demand that what month is in their peak is. and they monthly hit

And so then usage the is first we that charge. it's fixed the not that tied about the when directly to talking It's charge customer by demand XX%. the we're off throughput say and

charge that one So, the now demand going shift and in it's now essentially to work got working set shift, to the factory from bill. shifts was that one is down if you've three a

don't we and know So, -- we don't every rates year. reset

we the the every until and demand charges are they're we demand have until a a on rates hits have what in -- the Then, are customer month. rate charges So the our place are, case. demand based

to there? So, you add Eileen, anything want

Eileen Mikkelsen

No, you. Chuck. Thank

Charles Fishman

me. try for maybe in to wait, it fashion more Chuck, simpler put a

fixed And have correct? saying obviously a the only does component production. two lines factory what lines on that down downturn, while they that say three cuts demand. that use because said production. of of a continued Then, here Let's a Well, you got lower after you're of that's is go we're going to

Chuck Jones

It lower likely would it in that scenario, for lower customer. can go that go

Charles Fishman

a that recover to rates reset at you'd point, then And and for wait to that have correct? rate case

Eileen Mikkelsen

up, Chuck, in here. jump monthly set peak the you just demand that When billing monthly if I scenario a are hit in on demands I have a when pardon you sensing on about we me, those basis, what's indicated, I'm the could basis. demand think rates

change over if separate demand course of customer's they just So shifts, of demand go demand during day, to billing necessarily example going you one their not the shifts said used. the Chuck place peak because based running shift that that aggregate extra it's rather, two to be, a the elimination one would demand as earlier that isn't those as three peak in and the day remain to of a shift, expect an we so to on that result it's

Charles Fishman

guess a size I irrespective but customer a if makes its saying the Well, production? decision lower of conscientious what shifts? I'm by reducing to its what demand is, number of So, of

Chuck Jones

these throughput past you that of that off tell we're that a do think is, and trying customers the ability out charges revenue same recessions, when that bill, know case going In occur to by about off XX% to bills. by And, that. all you paying to be experiences entire charges all there but segment, are that in because isn't our reduction even amount the their in might across during will be fixed customer's not demand have

Operator

Thank you.

from question. proceed Sachs. comes with of question Please Lapides line Michael your Our with next Goldman

Michael Lapides

have just residential on both Actually, taking terms out of for customers couple all you about of you the XXXX, happens trends you level? what today's you over on residential industrial of you customer served the not the of Can I question customer demand, years? side your taking you time the the on coming talk customers just XXXX industrial side, have in the and last number necessarily my appreciate about counts, a to seen question across Can about and counts talk earnings serve. call. and the of number but Thank

Chuck Jones

lost of I I we in to stick XXXX I part someone in industrial think, we lost Well, or in Eileen's numbers in the But XX% And it brain, my anymore 'XX. lot of maybe of of in meters customers. my lost we load Ohio 'XX end XX,XXX in remember the think year not XXXX, our was that they're I know Ohio one alone. else's. numbers brain a obviously, from are that

you in So growth, fact the thing have can to fill energy meters of is in pretty in that growth what meters those against offset But the that Eileen, numbers? much flat much also our no some year. results Maybe on the which is working low Eileen is we by any numbers. across being seeing growth are every footprint. in efficiency growth pretty

Eileen Mikkelsen

in counts. customer Thanks, I X.X% say counts one would a Chuck. growth just XXXX, just quarter quarter in grown have residential Yes. customer in our quarter-over-quarter. about one versus XXXX In

of So for quarter we've seen and every a trend each that quarter, prior number that quarters. continuing

Michael Lapides

long-term just growth Got easy EPS growth it. X% Thank you real your X%, rates? your load the in X% remind and one. you an is quick. X% us assumption Can to That's what in to

Chuck Jones

one? that take to want you do Steve,

Steve Strah

assuming planning we're horizon. over our Michael, basically Yes. be to load flat

baked when XX that So X%. we slightly these to the But have right both X% X% we're X% look trailing that's that into at below what to we now. and months, the you see

Michael Lapides

it. be that Got And flat. still are in it'll assuming the X% to X% you still

Steve Strah

Yes.

Operator

you. Thank

question from proceed your Paul next Glenrock of question. Our with Associates. comes Please Patterson with line

Paul Patterson

in these just relatively have we that immune, thrilled, recession, economy. tie the big in I'm one with reopening. at mind general. looking establishments, things or here It's the sort I a just because retail never at to you thing economically region, that, slowdown, here I saying If or mean, you of maybe here. just least questions guys out not all of to comes a guys is you the on businesses insulated are I are question potentially deep guess this guys we're guess, are relatively that up

trying changes see just you guys Are long-term make have that recession, a you basically, regulatory anything don't big I'm I you get to impact completely that if deep, could or guys? saying that we clear. sure any

Chuck Jones

that's now is of that distribution not And XX% our of right I footprint, diversity streams with and the being load think transmission residential dependent. the to revenue our being of diversity what trying a third say take see the revenue fact least give as or a to earnings that we that of the at outside of going you us significantly range. that range stay home there that's growing is $X.XX nothing piece at that long we're as in of

comfortable were guidance. So reaffirming we our

a big I need we're utility the expenses deliver a of we we get being parts of in our if said, be some moving diligent mean we'll related we our a -- things, have can side We've billion as $X to lot And company regulated of at we offset and and can as over commitments. O&M more company on might what do I little that work a to discipline of O&M on meter to got happening that.

the the think be will pandemic. way businesses and think like services needed in. something don't are to them, in small is, reopen to that I They after were the in survive providing no particular have time, there coming revenues this that somebody I'm I they liquidity So just working that by to the do with society. capital take replace are because going certain this don't But, yes,

going it's maybe people than people say I U-shaped think think, of handle some more built the be I lot think I So it deeper way would to maybe at able be think. FirstEnergy. and to what But to what than is we're a

Operator

you. Thank

line question comes next with Please with KeyBanc. question. Our Karp proceed Sophie from your of

Sophie Karp

to mechanisms recovery to follow up want I the you on that have. just

which trackers, track COVID what's rider, I what's jurisdictions of COVID Thank you. now the it easy has to outside that guess, or is COVID, which costs to utilize So and specific how point? your COVID riders Maryland, and established at related separate not this guest I that

Chuck Jones

been in think Ohio our our is about the already lot to mechanisms recover recovery as normal a biggest uncollectible that in of Jersey ultimate have New have of and place so expense. I worried case, operations And part people in piece we Well, those.

deliver I are there's think of I said, be think going should we're -- the the we concerned step you're going They out and leadership. said, think to going challenge a that Maryland still proud treating that. And the for normal country treating unique time, what costs have and it today. Commission, not these far regulators. I times as take need to We're and to working be going right another over and Because, that regulators Service Public lead normalizing there's me now, conversations with the costs. I'd I very And as see just But, across operating realize having unique approach. aren't to be to going with on operating so if overcome it and be regulators say and a like to be we're as their anything commitments they these on our do. the challenge first I ones that [indiscernible] we're I'm grow, others any watching of other with our we're guidance,

our now, whole to not end going I'm right out, concerned anything our and Maryland discussions normalize that have in special done. have regulators at But not the having costs fill treatment the any then gaps in we we're the -- a Virginia by disadvantage to of to need with has COVID starts didn't not that. in are doing We Pennsylvania what if kind overly costs FirstEnergy West And to any these first not to felt I'm industry similar they're if quarter for. But anything about. put

Sophie Karp

the to Are maybe may Have be of And any or defer that looked done you with of that type you. cannot looking else? there particular CapEx. any on maybe at bring efficiently and real Thank be project that something distancing yet? you quick forward then work particular types social

Chuck Jones

don't that's there's see anything No. we problematic. that I

increments. you these in past. average plan We shared then $X about CapEx million $X.X million think numbers in the spend If I've $X our billion to

faster is we most and They job. half crews very keeping to with and two know have pretty over had right they're storms and not safely. a as normal to million "Look, occasion saying, X through operations. rising important significant the lights we're are a businesses they're and of essential," if very the we're families So our would the out do customer part. on And that workers going challenge fantastic prove to work as for and And as fast We been they restored projects million smaller creative service they But figuring the we're come how under outages. doing to now. essential a

there see either. are anything So about I we that don't worried

Operator

Thank you.

question Jeremy comes JPMorgan. next question. with Please proceed with Our line your from Tonet of

Jeremy Tonet

any we're if regards 'XX. compares very of helpful? mechanisms what was about talked very to how the New now wanted in question. that pick could up would some wondering But to color -- to Just And there in with bad you that you debt more then. provide everything Jersey, just Ohio, be on recovery And that, looked expense I that kind or is you detail here. when like XX', in early have How

Chuck Jones

them think them get And to can't is having today we in first something the fair to again that thing would more up into My have we're going forward we're assume and settle is more more to say, XX I experience day a help not even debt. we we Well, thinking I've be their I for this who this we where of to bills; credit did off backed that and a mark at up business been bill going be bad payment on how bill here end get what's can they and -- a that where years, lot with customers, flexible particularly and our worth being how up looking going back every normal getting past, don't for we're end pay flexible it's work of their want customer to to have get don't today. back one. and to do up history. C&I operations working to C&I as business don't with are And have arrangements long And to ease up in the they customers without as customers. through generally creative to their writing black right a want the pay way, we

this then So becomes have only I rates, we that companies the all when other said the Jersey. of under it and early did. on our of off. New write expense a will and as Jersey, in And with that it Public we recover think Pennsylvania have I Maryland And existing customers the Commission, from get little bit to Pennsylvania -- to in a an New have ability still uncollectible Ohio, Utilities what process. in discussions in now lag together ability We

quick. acted Maryland while So

of costs looking are too. these at all regulators other COVID The related

Operator

Thank you.

Our next question Please your with proceed comes Durgesh from Chopra Evercore ISI. question. line of with

Durgesh Chopra

maybe base. missed metrics sorry if and can And credit and sort you any versus wanted credit us about you your do rating but the think, sort credit second color I conversations you. you in year transmission agencies. how then ask your of this, of of with What are talked I decoupling provide I with the metrics rate terms -- you just this Thank your maybe about you've XXXX. the positioned Am to given that target part,

Chuck Jones

Yes.

delay is up would just So year plan transition the saying, then XXX still XXXX are the don't until report. this year in emergence XXXX. significant I by year on Energy We start there's XXXX new with a million and no to this And the to I again, turning think out, year. from Harbor XXXX. metrics to anything The equity this in

with threshold. the upgrade Harbor, all support at S&P the And today. discussions upgrade And XX. the thresholds. think thing. we rating important anyway. positive But revised in current We're with eventually think will Energy We're beyond I Fitch with excluding that's XX a this threshold outlook you about for the from BBB us. to we're having agencies I So good Moody's, our all looking year shapes are

in conversations on one where past, rather think And is current rating are the the the been the focused than bottom with our worrying needed about the is upgrades As what agencies we've top-end and a change our discussions I in which key see. of the pandemic of example end. for agencies is it. is, to perfect profile. the We're now are risk starting with is impact that our having of the dealing low for The risk that we're profile drivers

pension credit no earnings, change status, material no funding in no change have our in material in change We material our metrics. our

I And residential of customers. -- have with generation a revenue X there's we're coming that plants businesses, or, footprint, able and million you if from of T&D companies of would multi-million diversity the our regulated just a do ours We very plan either. environments, to of Other with And business couple what's our FirstEnergy. generation forming think I agencies footprint. constructive focused enjoy discussions. one And have three with tell we even We're large support or regulatory because like small the so very, foundation XX% power that. get we they two have the the only risk large customers have the the of that's think rating to side of don't And at only are there and I space, in ultimately our profile, this all there left companies a other we generation into BBB then and long low our on stay risk that term. stable

Operator

final Thank this the question you. with your our Bank. Ladies morning and Please gentlemen, comes question. with from Scotia of proceed Weisel line Andrew

Andrew Weisel

about mechanisms here. the Appreciate ask following of meters end to thing squeezing details I New all and the the protections. wanted in what's for just on the on moratorium? One smart in latest downside Jersey was, Thanks thinking me

Chuck Jones

already got in I We're think we've that with beginning grid lot now the in mod the where Pennsylvania BPU the XXX,XXX them almost New the of administration that And million process we'll install in engage Well, will with around installed. in a with Jersey. we've of and X conversations in Ohio. Ohio, experience we

Jersey risks the engage states. New really position benefits us are. puts others like smart in that's New in have a go. just the the Jersey meters install New Jersey in to we'll and want we'll where that Then the in we share policymakers in of discussion a of million think to I what some ultimately, and in some And

Andrew Weisel

interest your this politicians regulators Okay. noticed appetite or home change during stay you period? in from Have any to at

Chuck Jones

through including under introduced in the pandemic plan, I his now, this new governor shortly think hit. pandemic the to how government, And this everybody that -- focused on are now. energy best the just master right get before right think I BPU state

into off a think New those up, back more picked been I operations. put normal have safe and once kind of discussions back and it's gets -- get healthy Jersey they'll So

Andrew Weisel

it. Got

dividend mentioned I Or Is the past as a growth of I all grow Okay. that few the you the sustainable. latest your last of the there's management dividend where one, to dividend potential at can may, but aspires over something new policy? nothing, if you if slide on months? the for Then described it. views one share might be sort changed deck And and that's that looking softening outlook

Chuck Jones

think you're I there. reading not into that's something

it Our kind now. And the dividend of right policy range of is what is. high-end that we're at

know that are committed dividend is not that's to but to single don't and the think we communicated. my we that, expect that the what so that and every you decision, that's high-end So, more Board's, I expect I our we can range signaling year in we've policy one honor of that's it's the

Andrew Weisel

Sure.

and I there was be and thinking. good. sure you wanted much to change stay healthy. Okay, so just safe in no Thank

Chuck Jones

All but a this care. all this you seeing can forward we're We get all going in running again. right, employees hope on -- it talking is safe to good and get good The I'm to as of we're thanks healthy. and now I say I've person to to safe it's where going through commitments; regulated and you. healthy fine. we're proud about call have too. you. to call, a just when to look utility Take regulated well, of deliver our team, sense operations. keep can't that said you boring right with pandemic, of repeatedly, stay our And our makes Thank We're going

Operator

concludes This today's Thank you. teleconference.

your your disconnect Thank at you this may lines participation. You time. for

FirstEnergy (FE) 24 Apr 202020 Q1 Earnings call transcript