Earnings call transcript Q2 2023

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Operator

Good day, and thank you for standing by. Welcome to the Avista Corporation Q2 2023 Earnings Call. [Operator Instructions] Please be advised today’s conference is being recorded.

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

Stacey Wenz

morning. Good Second Conference Avista’s XXXX Quarter to Call. Earnings Welcome

quarter released on premarket earnings website. and morning. were second our available Our this XX-Q Both our are

Joining Officer, Officer, Kevin CEO, and President Vice President, me and Avista Christie; Treasurer Vermillion; Principal Controller Accounting CFO, Affairs Senior Vice Krasselt. this and Regulatory and President, are Ryan morning Dennis Corp.

is our to various risk expectations conditions we based and share and our uncertainties, risks will and our XX-K of And involve These factors these assumptions, will today’s quarter from cause expectations current XX-Q make Today, our as as for differ discussed other the we are on actual certain normal date. change. factors. subject of XXXX, forward-looking. this on temperatures call. results information available statements discussion second generation hydroelectric which today’s are morning full of as materially that to are precipitation, for below The to in which of website normal XXXX well could refer a for Please operating

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

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

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

the now I’ll turn Dennis. call over to

Dennis Vermillion

to weather, infrastructure incident I employees of our Stacey, historical sure. congratulating I’d for leverages tool. previous tool in for one operations you’re outages This our one Well, outage begin for Avista’s won Chartwell’s so forecasting good all morning predict weather and been Best the recently awards outages. Practices database everyone. future and by thanks, hot a innovative far. hope like morning, and enjoying It’s the summer who this to

every what energy across that our are which innovation one to safe, Avista’s and the prepare upgrade This the times proactively approach for just reliable to for response we is at experience. invest spirit, how resources. customers. to service infrastructure helps and great improves It allowed while plan informs customers events, capital deliver how spirit example to us our allows better of the do enhances and we customer utilize It harden return. time, overall our us we our weather closer potential and our earning to moving our maintain reliability enhance day to territory In continuing same grid, of

and the Regarding We into this on gas reached go rate in we’ve multiparty and will September. natural agreement progress regulatory settlement cases cases, year. significant new made rates a our Idaho front electric in effect rate

principle expectations. case, in Oregon line which with rate in settlement a our in reached general also is our We

In X Idaho June, the projected Thanks recent growth to we we the outsource filed we’ll our new the serve that our the might and over with RFP. and XXXX energy next selections XX Plan years, remember, you And resource and every IRP, electric which Electric an to resources our Integrated need for produce from customers Resource then details demand commissions. Washington years.

the position are to our a needs into good really and now We in customers’ future. meet

year and our we to results including our and to interest offset respect ahead take rates to employees financing like half manage for just the for actions I’d ongoing expectations first are With costs our slightly the acknowledge the of our higher of experience additional to and inflation to their minute a that impacts to of earnings, leaders continue costs.

benefit the of and efforts. work good the show these results Our

of for a our and to XXXX We range $X.XX with guidance consolidated are annual confirming $X.XX.

years the many, than we’ve from to of the years. lower seen Washington many in expect costs the to of normal than mount and resulting due worst in in under we ERM expected snow range the be one However, faster end higher hydro

who over our Kevin? earnings. presentation this will turn to like share about I’d to Now Kevin, more

Kevin Christie

It CFO. looking investor in working AGA group morning at regulatory I’m and They’re and you acquainted morning, I’m our the amazing quite call good to past of closely to was this and or a meet more excited my who at to pleasure teams to be this Dennis, here forward first thank the May, finance, leadership everyone. with as great Thanks, the Avista. get smoothly. earnings community with their have a transition in future. here like made CFO accounting go many and I’d

result quarter Utilities turn As the ‘XX. we of quarter the Avista the margin of second under XXXX as second general quarter seen in cases, year. lower compared costs rate customer last to ERM to growth the earnings, a earnings to second increased of increased our We’ve and of compared

quarter a year. pretax a Year-to-date, second million of compared the $X pretax million year. quarter of last in we’ve recognized $X.X of $X.X of was $X.X million In expense pretax the this second pretax in expense million ERM last of to benefit of a ERM expense a to year, the compared the

year, in the we full to with expect band sharing XX% now expect the earnings $X.XX the end year of the a customer, For XX% per under share. ERM be to decreased higher diluted company costs and

appropriate the in Washington the the ERM cost-sharing whether are examining volatility Recognizing going ERM, forward. for most mechanism the we is

the We in to necessary continue be utility infrastructure. committed capital our to investing

were Avista on expect first half year. to $XXX the we’re million total $XXX and expenditures utilities million ‘XX, well our way capital our capital of in as We in expenditures the

in invest $XX expect $XX to expect capital other in million to ‘XX, AEL&P’s businesses in our be and XXXX. We we million expenditures

half capacity for and $XXX terminated from to First facility. was of the of facility million $XXX as line our a our credit treasury of we credit million our million $XXX the year increased time revolving team busy

our under of letter As facility. available credit credit under of of our lines $XX and committed of available million June had XX, we million $XXX liquidity

issue intend issued year. million of far $XXX we including to thus $XX common this XXXX, million stock, During

under XXXX $X.XX the confirming range midpoint benefit or Avista we’re our does per Like of $X.XX ERM. include any guidance Avista Dennis $X.XX in with to The the share our $X.XX earnings diluted guidance mentioned, consolidated Utilities share. to per not of expense Utilities contributing of diluted

Avista a consolidated in on mentioned, the As expect basis, of range to at higher-than-expected to and resulting from due ERM, poor hydro the under the also we be costs Utilities year’s conditions. end this lower

company to decrease per in to share. XX% the sharing ERM year, diluted $X.XX XX% a customer, be the we of earnings with expect For band the

by As the tax our margin increases. we of in customers included Washington, impact of our mentioned tax quarter and offset increase annual to cases credits no that fully that The XXXX rate income Idaho bills and general the in rate will the bill effective an tax and reduce customer tax both XXXX end utility resulting returned of customer in third longer quarter, expense last be rate. credits started ‘XX will

throughout percentage spread a pretax of Our annual tax as year provision income. is the

the XX% of forecast our utility represent half year for first annual the earnings Our of earnings.

and in We remaining in This the to of quarter. earnings the any utility fourth XX% expect excludes distribution the impact about X% the third annual quarter ERM. of the distribution be

jurisdictions. Our in guidance assumes rate timely all relief and appropriate

to diluted range $X.XX to per of in We in expect the $X.XX ‘XX. AEL&P share contribute

our diluted certain earnings We Overall, losses our some share year. frequent investments contribute businesses, to recognize but for these earnings, updates $X.XX to volatility per expect introduced net due $X.XX increase primarily Quarterly additional in other businesses more value. of to valuations investment our the of the to other we of valuation adjustments. transparency

Stacey to over back for your call the turn I’ll questions. Now

Stacey Wenz

Thanks, Kevin. welcome We your questions.

Operator

Mizuho. Will from first comes Our with [ph] question Grainger Instructions] [Operator

Unidentified Analyst

morning. Good

On ERM. you positive call, mentioned you that the are some anticipating uplift QX from the

seeing you mentioned about expected costs. that impacts and you’re guidance? you’re XXXX talk a than remarks, experiencing you Now in that bit little what prepared Can how here your your higher

Dennis Vermillion

the really Yes, And was company, us only Yes. May, time if -- our to decent sitting hydro for QX cold forecast normal. spring region. for the we a not call, for snowpack but colder happy on were recall, with and until you’ll very -- up than really pretty for the

year. So less the snow it would than mount in a was be normal

good got snow nice you mount slow normally if the in so year as well, have, hydro the of that like comes rest then would look, you that hope And melt we a good when have snow we’ve would to off. we you’re situation, have really

ended is all came but entire only not was snow region month. what the in warm, up the our one And and area, happening down May really service for very

is of numbers there’s wasted you generate. that hydro water May then but the but good, much, a can’t were because pretty lot just So too

So until ratably below were down little out with of make snow what didn’t flushed just -- and to the work the expecting to system the year it it lot of mountains, up that was Certainly a was the cold the that it up way. because not Hope when want unusable. also. bit And is come time would point. doing us and up a ended of normal that you that spring, we the at

that point So around what what forecast, the impacted in time it’s really thing. May. swung on in And for only just in region-wide ERM weather projecting May, us, that we were not at change based but that is really and a the in hydro

Kevin Christie

Yes.

met be at $X.XX Let we Dennis. now on to quarter. last We And heard me you’ve positive were build as that, expecting here. on here, side. at we’re when other the $X.XX

So we we of ERM, bottom but and that’s range, down as bear that’s weather would pretty and significant balanced described. that that the the we’re bring does to a And have that the results that for earlier. why pretty Dennis said it strong goes our if here, towards end weren’t swing, us indicating results,

Unidentified Analyst

Understood. here. gears If I switching maybe up, could just follow

investment. a specifically, Should to XXXX, $X.XX last puts for you positive be of QX the the about the we year, guidance thinking takes your back balance the On the expect we from about in something hitting a in half should are mark-to-market How and year? half of biotech of second what of that? similar had

Kevin Christie

don’t range a to as expect non-reg set think the earlier our in $X.XX to referring and indicated don’t in on there’s be you’re shape. shape a to to investment we there’s I call, the portfolio I our think But non-reg investments. $X.XX the overall investment set we overall. profile

the We’re range. some down $X.XX periods, there to we prior expect turnaround get far to and that compared for to would year $X.XX and to thus

Operator

further this back to to And I’m turn the like questions any showing over time. call not Stacey. I’d at

Stacey Wenz

very and you you us joining today for much. Thank Have interest a Thank Avista. your day. in great for

Operator

presentation. this gentlemen, Ladies and today’s conclude does

have day. You may disconnect, now a wonderful and

Avista (AVA) 2 Aug 232023 Q2 Earnings call transcript