Earnings call transcript Q4 2022

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Operator

Good day, and thank you for standing by. Welcome to the Avista Corporation Q4 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded.

to Wenz, conference Investors like speaker to now Stacey today, Relations would hand over the your I Manager. Please go ahead.

Stacey Wenz

Good and fiscal Avista's fourth earnings to call. morning. conference year Welcome XXXX quarter

were and released available XXXX our website. earnings Our Form on pre-market morning, both our this are XX-K

President, this President, Vice Officer, External Christie; Chief Officer, and me Affairs Vermillion; Avista morning, and President Thies; Kevin Controller Krasselt. Accounting our and Ryan and Joining CFO, and Vice Dennis Mark CEO, Corp., Executive Treasurer Vice Principal President Senior Customer

of statements we will subject Some involve today assumptions, are change. make which and the are risks forward-looking and to uncertainties,

available reference from our which those factors, could website. refer the today's materially in is differ please call, to for on For discussed XX-K to to cause various our results which XXXX,

results today's the release. I'll press recapping begin by presented in financial

For last the to compared per full-year, $X.XX were consolidated for diluted XXXX share earnings year. $X.XX

fourth diluted $X.XX to Our $X.XX of XXXX consolidated were the of fourth quarter earnings share compared for quarter per XXXX. the for

Now over I'll to turn Dennis. the discussion

Dennis Vermillion

Well, all. were and to for above Kevin York the NYSE. Members It Board stood November. I of Executives of on year listed to anniversary Senior and start new a being a closing with great I is group and you everyone. thanks, Mark celebrate hope was good ended memorable accomplishment off Stock ring bell cool. XXXX on and the the the a who in Stacey to among Avista the podium New Exchange our morning, XXth pretty

extraordinary state claim the the achievement. listed an of can Very top NYSE. few of XX% are such companies the longest among We to members

them, and the certainly special us, came achieve before major very honor who employees have without be As and We more Avista's couldn't who it CEO, was President never an proud forget. former a for not certainly it that milestone. me, of experience this done helped I'll all could and current I

hard us was business XXXX. when and our through times. see than true founded, back their challenging that XXX over natural to pull highest our amidst a rise worked you and years and We inflation in employees more look power gas and certainly always our in business We interest run to course, you had markets our That's If extreme diligence in the to demonstrate rapid of rates. the manage will determination for volatility decades. costs

will were bit Despite a slightly non-regulated to were fair certain minute. a Avista more below little basis, On the Mark of in earnings significant that consolidated our Utilities' a our than in on expectations. efforts, value our have expectations increase better a earnings And investments. due

As we the begin they XXXX, the I'm like us they forward, once and know again, answer grit our and of propel to call just I counting always do. on determination employees will

that operating filed and allow of XXXX. we investments costs a of cost Washington in approval the infrastructure the earlier company that experienced recover to So month, success. rate utility in plan multi-year ongoing key agreement the the regulatory in rate to our the we our are XXXX, The Commission's multi-year for settlement step. cases this And was Idaho in December outcomes our in increased would first

general rate within plan to case a weeks. We Oregon also few next file the in

case of rates XXXX. January into in expect go with to associated We effect this

needs. seek issuing our we've taken contracts our customers resources achieving clean a to renewable for customers Plan including energy signing continue We gas Energy execute and Clean resources and to Implementation energy for for meet aspirational natural request on hydro and goals, our renewable, our steps to wind toward proposal

for for among energy through this our transition, we serves most important believe gas work clean customers, vulnerable and both that an those especially reliability the natural we role us. support affordability As to

and This Avista's an and metrics. a diversity, to our reporting supplier aspirational latest communities, goal updated examples diversity and the series related demonstrate our on customers, Avista's and recent responsibility for latest our includes to our our and and we aspirational data ESG In that goals with disclosures Avista's continued which showcases along inclusion shareholders. commitment December, people, corporate equity, of report, environment, workplace update key industry

this the Board our month, the to marks maximizing This annual dividend shareholder by X.X% year approved dividend $X.XX. by an The our of earlier demonstrates has the raised Finally, increased value. to the commitment Board dividend for Board XXst consecutive the increase shareholders. Board dividend the

Mark, earnings. this to Mark At discuss like time, away. to I'd invite take our it

Mark Thies

and Spokane everyone, a this game going. only local goal and minute to just keep morning, in won goal go the energy straight tie-in positive the The and call shootout. with Tyler night, the Good Dennis. to kid scored of a scored Thanks, Johnson, than third last the Blackhawks their less

the Blackhawks nice a the to little so the three two, So goal, positivity. beat

still in very Bedard are third The in not this We sweepstakes, lottery the year. were Connor place good which

the other businesses. hand earnings primarily as on were good they to due our other Our and consolidated Dennis said, were this year, largely,

to contributed company. an in in XXXX. the these biotechnology compared the earnings result Our in really the in investment a share of value $X.XX per fair majority other company, of $X.XX XXXX increase were of businesses the The significant bioscience

market shifted and in original for biologic drugs really drug testing of administrative to accelerates through the biotechnology. to advanced investment the company development has stages. biofuels, it orally core, later antibody and our tie was for time acquired Our the platform Their was but to to this focus patented

As they the of the expect XXXX. until of value don't right investment and really now, has are trials and this clinical significantly, in a end results we stages result, of various increased

to expectation. So going significant before time there's as our we have that some be updates on

XX years. and Xx our required $X.XX to was and margin was, mentioned, impacted secure and us a This over available Dennis extreme along This in we to colder December, we prices For borrowing below volatility with power significant as arrangements, XXXX in normal, did as which Xx markets our Avista gas additional of expectations, west, and throughout the to fourth led costs. we've XXXX. as to to coldest compared to volatility In observed in natural much the result liquidity higher slightly seen the supply short-term the just temperatures contributed higher and a quarter. in per December, power share across $X.XX which that's Utilities leading than calls, November

earnings about, supply recovery the expense that result Utilities combined pre-tax expense, the in in of Washington prior higher interest power a year. mechanism interest $X.X energy expense talked of to I the and costs The compared the pressures million Avista pre-tax million just reflect of expense, a was of $XX.X inflation.

deferred So of XXXX. costs begin to Commission in in exceed XXXX, million result, file in the these costs as July with April a $XX Washington our and to we expect total power recovering

continue that, to we necessary capital be we With in to and expect capital capital to expenditures maintain invest annually of XXXX. expect. expenditures, In safe to standard the utility $XXX our million always those we as our reliable, service infrastructure respect a through

again We $XX $XX XX expect XXXX million be XXXX, capital in in million million XXXX. [indiscernible] and AEL&P in to

As capacity and million. give capacity I a the commodity $XXX difference. $XXX a of liquidity, little In experienced million and earlier. increased increases issued million significant short-term bit we the We liquidity about of but total by too, common we XXXX, borrowing million, need $XXX in mentioned $XXX our significant earlier, had additional long-term In to fourth talked bringing about we stock. maturity debt I the just for our quarter, to as prices there $XXX million in

some to $XXX and gas power had reduce common so revenues stock $XXX deferred short-term In we reduce long-term had we outstanding As of borrowings. expect liquidity of those of of debt with to at facilities, natural made million a borrowings. of in a expect our expenditures operating costs, our million XXXX, margin part, from we available $XXX to planned recovery we under to resulting and million to up expect short-term issue we XX/XX, deposits year-end. these million counterparties, fund $XXX In and return and of increase

$XXX million $XXX that committed and We million capacity also million credit in second has its in of increase under million XXXX. revolving expect our of available from facility to liquidity expires AEL&P line $XXX to credit our November quarter. the $XX in

bit our to want of on discussion give a earnings I little guidance.

earnings with range diluted XXXX guidance $X.XX $X.XX to our confirmed a we mentioned, of Dennis share. As per

assumes Idaho. management multi-year Dennis filed And key rate is guidance these are as cases appropriate jurisdictions. of recently as our costs. in in we of success, a all our the ongoing and outcomes Our our relief timely Constructive to plan in mentioned,

expect diluted we the increase under earnings benefit per We $X.XX $X.XX not midpoint does Avista on The share. diluted to million per of be $X the of share. Utilities the $X.XX in or and an to deadband, the of within in range of recovery either midpoint guidance any mechanism, expect to expense with our contribute the side include energy

increase of of costs, as I our earlier, manage to XXXX. to O&M expect it in in an X% that's We part mentioned

continued as reduces return working estimated to costs XX guidance XXXX that on timing regulatory reflects by we're basis lag points, our equity our Our structural XX as approximately that reduce basis equity unrecovered approximately points. earnings reduce by return well on to

So X.X% this for in an of XXXX. return results approximately equity in Avista Utilities on expected

We and AEL&P And expect to share. our Utilities outlook $X.XX $X.XX Avista diluted AEL&P in continues there to the precipitation range for contribute per normal year. of to the and for hydroelectric include generation

we'll may to sound don't $X.XX the those, watch know had of companies. they but earnings occur. I of record results our we bit, they significant grow two to this just to these years those of businesses predict the expect other a and and are $X.XX, as little valuations – We some contribute in We continue as we've

So we guidance. we out $X.XX that expect share $X.XX in is per from are what perspective, putting general to our a

effects are operating known unusual not Our normal generally the guidance only and any until also include those conditions does of includes certain. or items non-recurring and

over the turn now I'll Stacey. to call back

Stacey Wenz

Thanks, Mark.

You take your questions. are to happy

Operator

the Russo first [Operator you. question Our Brian Instructions] from from of Sidoti. line comes Thank

Brian Russo

Hi, good morning.

Dennis Vermillion

Brian. morning, Good

Mark Thies

Brian. morning, Good

Brian Russo

Hey.

give RFP projects some and do that submit the competitive you detail You earlier, self-build to your Act past? you the could mentioned makes of maybe expect a in and possibly The size Inflation just Reduction self-builds on than renewable more more

Dennis Vermillion

renewable remarks is referring this gas. I was The Yes, my is RFP’s in that to Brian, related natural renewable to Dennis.

for our to customers. first from RFP that this supply is So perspective, R&G, basically for renewable our

we nearing federal that mentioned hydro money source are hardening electric, capture with anything have on completion of On completed and to a some Certainly regard we from opportunities electric people side, to efficiency upgrades. haven't we've number uses for the couple of resiliency, that. but that's all some a are grid that yet, team the money and EVs, announced contracts RFP, I we exploring available, of with potential internal that – a

where look value. to no and But at point, that So we this we are in option detail to we have might some what capture that might able applied on future. evaluating like. be That the really be self-build could of looking a

Brian Russo

And in benefit, describe, you're going million said, clarification. just you in power I the for what be all your could are which you on you to Thank maybe deadband region, $X.XX that? forecast so, if then would given the to add dynamics And think prices $X ERM, in Mark, to Okay. relative midpoint. the that the the and gas volatility you allow the

Mark Thies

a normal Well, year, forecasting that's every dynamic. this We just every every do day. quarter,

did don't have some significant was know liquidity quarter fourth as hedged positions dynamic. that and going it not that changes I physicians more liquidity caused put and So a What our see significant some into for pressure necessarily. a in on the change positions we really it's we to hedge constraints, we that winter,

gas costs in but future natural our future there deferred the file those jurisdictions We recovered would we to the costs, extent because we'll our deferrals higher in cause gas in proceedings, and on have some costs defer higher PGAs, it. we also regulatory side, had get

and side, file I with dollars. the the million power those goes the $XX ERM of allows and hit the Washington recovery PCA, that the as through Commission On ERM us or did mentioned, it seek to to level

the in really the go that it's so impacted liquidity were and So XXXX, the XX% in the earnings We the side. cash the XX on – up. ERM PCA, and it's more were we side took because Then that. the by of did XX,

in cause did that miss our to earnings fourth quarter. slightly the So

calculations we and costs power we units every As of ended and report as currently come $X.XX. we those that's the quarter. forecast the that up conditions we with the ERM that our what forward, supply we Brian, That's our authorized to prices where for forecast and availability can compared change and change with expect forward up with we

where that's XXXX. prices looking today sit at So forward we for

Brian Russo

Okay. good. you very Very much. Thank

Mark Thies

Brian. Thanks, Okay.

Dennis Vermillion

Brian. Thanks,

Operator

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Dennis Vermillion

that's We Fannie she may to she, have if okay, know just right Fanny, He need next that's or I operator, and is. all can to back if move don't that's if the come back. him – question, if come

Operator

to no the further I'm for at conference this turn would closing like to Wenz time, course, remarks. back questions. I Of showing Stacey

Stacey Wenz

on day. for interest Avista call you Thank our Have your all joining us today. in and a great

Operator

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

disconnect. now may You

Stacey Wenz	Investors Relations Manager
Dennis Vermillion	President and Chief Executive Officer
Mark Thies	Executive Vice President and Chief Financial Officer
Kevin Christie	Senior Vice President, External Affairs and Chief Customer Officer
Brian Russo	Sidoti & Company, LLC

Avista (AVA) 22 Feb 232022 Q4 Earnings call transcript