HASI - Earnings call transcript Q4 2024 | Hannon Armstrong Sustainable Infrastructure Capital, Inc.

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Operator

Greetings, and welcome to HASI's Fourth Quarter 2024 and Full Year Earnings Conference Call and Webcast. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Aaron Chew, Senior Vice President of Investor Relations.

Aaron Chew

Thank you, operator, and good afternoon to everyone joining us today for HASI's Fourth Quarter 2024 Conference Call. website, full press copy referring year is on HASI fourth reporting of to afternoon, slide available and the quarter XXXX our today. this distributed will release a our which presentation Earlier we with be along results, a of available This call later page today. webcast where a the Investor live conference website, on replay being Relations is our will be

the statements, Risk the SEC. Some materially section filings uncertainties on which forward-looking are made are and other subject those comments from company's of described Actual the call in Factors of and differ Form risks to this stated. results XX-K may the with

also to presentation. release reconciliation discussion and Today's measures financial our some of non-GAAP earnings measures. GAAP A is includes non-GAAP financial available in

the and the Susan today Chief Melko, and CFO; us President Jeff Pangburn, Officer; Lipson, as Accounting as and and well Joining Client Chuck are CEO; Chief company's Marc our Treasurer. our Officer our call Nickey, on

off, on and today CEO, To kick who President to presentation Lipson, the I over it things open will X. Jeff our Jeff? Slide turn first will

Jeffrey Lipson

extraordinary alone; the and per billion; quarter over fluctuated; KKR; in adjusted $X.X earnings billion you, achieved for we thank Aaron, robust for closed interest with an fourth new XX%. all to share us of HASI on CarbonCount Holdings short-term our Thank including our closed the our was $X.X XXXX as bank our billion increased partnership you today we long-term of a call. Notably, transactions, $X.X number joining and margins and increased revolver by rates year goals. co-investment maintained X as

rate our with We policy continue interest results uncertainty. despite to volatility deliver and expectations consistent

deployment. restructuring talented during transaction, disclosed closing of is Marc take With venture. Pangburn and at performed The our our as investment-grade all I changes to level now refocus has on Revenue & our to Strategy CFO, the management on his as will excel capital achieving asked team, to our front, cornerstone his our our and in I including will of investment role strategy. and a new today. CCHX strategic address SunStrong I the activities our tenure organizational various Marc with me joint success on including our and success matters, ratings moment will work superior In a asset am incredibly confident Officer, oversee Marc portfolio management role. continue have this Chief Marc

also addressing outstanding an Treasurer HASI. and transactions. capital complex been debt in Officer Chief successful a closing numerous Chuck's years, full several have accounting for has Melko matters, raising I reporting for Chuck many to and CFO bank while Accounting and be ability confidence

made over is has I to has Nate Rose, to reduced has who our also to position XX Chief the can moving a nearly many desire continue company since Nate a consistent as the a HASI participated our will expressed tremendous during and be Nate team last tenure in know, every the been has Officer, Investment and he as and with with achieved his has objectives. success where want a be of to leader he you his investment acknowledge contributor XXXX, role for years. strong career

completing allowed to Congratulations Her outstanding her I our Association. of Nickey, also recognize several Client matters. like policy Power all. of Clean organization impact Susan Chief the positively to industry would Officer, as to our on American tenure leadership Chair this

a X% EPS annual resilient we policy all dynamics well to extending direction our business another our interest plan will With Slide economic to ever, a our which based that Turning aforementioned several talented business our XX% and positive model shortly are to is market in than of and in guidance moving we business our announce team, I'm will established, to stronger fundamentals, in growth have position adjusted scenarios. time-tested on and that X. rate year thrive capital confidence excited we strategy The continue expand include expect XXXX. to upon we

in reflection safe coupled recurring from substantial a of of extending the are $X.X billion generally investments large the their from existing a guidance is development to with confidence policy in Our that identified status also portfolio, changes future pipeline insulated revenue or due harbor.

an I as to per retain we also dividend announce I'm in $X.XX as February, share more a by capital, XXXX. XX% target continue payout indicated our pleased to to last increase ratio and

XX% target, guidance an investors end the by a interim As expect of should and between period. the XX% of ratio payout

few Now market of a let's favorable dynamics. the discuss

for United on growth. depicted higher energy of poised every as strategy need as the replace projects longer simply independent Therefore, but no rather demand more after sources near of States. to First, grow years inevitably zero clean the virtually years XX by power, will meet over the power Slide significantly move is towards XX demand all-of-the-above forecasted X, next other an as in than of the we consultant,

to to act deploy cause on opportunity increase discuss demand. can as Page a larger fastest Susan of new this rising development of creating and lower directionally offset to their meet more investable supply continue expensive a the will moments. projects detail least trend HASI. to depicted Renewables, be in renewables market ultimately and items And for to clients accordingly, X, These our renewables in rising prices. alternatives this the few and these energy costs anti-inflationary, more are to are expected

to Turning X. Page

reversing of projects Another will more is more to continue which frequent reason item is growth just that become and These of related disasters. clean sector energy a trend to solutions be have will events worth costly, economy. be our another to carbon-reducing highlighting climate-related critical to as the continue economy the

matters unsettled fundamental In economic to summary, business. moment, the although drive certain these will federal policy for dynamics remain continue the

to To Chuck themes, to financial to these find would is are investments continue returns. on resilient we'll confidence any to with we will and followed to strategy Susan, changes Marc if like attractive the cover regulation, Our our discuss we by have our or I risk-adjusted policy policy call adapt turn and over Susan? investment business results. in and there expand

Susan Nickey

I appreciate to of history at Jeff. energy. the you important all speak clean in moment you, the to opportunity Thank this

While remains forces U.S. the the to demand, new that and approach that broader and there uncertainty scale. by administration, deploy the energy accelerating the the cost is lowest being at for fact all-of-the-above growing an market demand renewables of fastest fact related driven are are to supplying to the certainty that need

the well no energy. X. Slide on The and Opening telegraphed, clear early major included Trump executive orders related to had impact been administration's surprises

to process uncertainty new and to continued targeting have investment electric projects, have impact permits. actions led on and While federal agencies grants loans thus for wind, issue far, and orders EPA some the HASI's DOE opportunities. executive expected have limited The vehicles

and new dominated The fulfill economic for by and security fact to is the energy. commitment growth, relative their storage and speed will storage, and to national the administration's corporate given electricity addition And deploy, U.S. to clean to capacity pipeline the state to need commitment solar near-term prices. and cost lower renewables remains strong generating new in

a outcome corresponding industry come to Inflation the and investment outlook with potential Reduction large to of on light in the in although final December not Act, energy continues to maintain expect may of until in reconciliation clarity bill, bipartisan expiration regard the credits manufacturing occur for the tax the revisions forthcoming the support XXXX jobs, growth. budget the we clean With the and property tax new economic energy increase cuts. Nevertheless, to taxes

in policy unchanged tailwinds indicated, growth; our the core by cost are both to As to and renewables speed business U.S. advantage market. demand power second, and Jeff first, underlying include: and

just critically, about prioritization highlighted one we several experienced from in hand on Slide era data is as one onshoring. years decades. On XX are demand which forecast U.S. Data ahead. increase new domestic power driving XXX entered demand new by the also First, AI. the just But well-publicized a manufacturing forces than growth X, centers, in of and years. the is of that of more centers terawatt-hours in to not haven't power has demand It's it's

also XX with that, inflationary pressures of the not underlying to than processes we vehicles. will X,XXX of there by unable demand driven meet XXXX, On demand supply buildings, are by terawatt-hours electrification top this top going to in, All the rising If U.S. years of is supply electricity to double on more is next labor IRA, sufficient the demand. McKinsey forecasts but and industrial from and by higher prices costs. chain, energy drive tariff over

multiple to see starting already signals power across that higher are the we prices. point shows, to markets XX Slide As

scale than can about be which business. and PJM ERCOT years are over sources, Forward and due gas They expensive including essentially deploy. but renewables years. X supply to have price or simply X constraints market policy the Therefore, faster take to at last curves to less not basics of the doubled will turbines, other in more

Slide currently only on gigawatts interconnection solar XX XX, of shown includes batteries current solar January XX% of generating XX queue. but FERC's gigawatts gas. of XXXX, from probability high As new forecast In natural the account and capacity for

renewables As a central component rest will arguably important most you the decade. one the be can see, this of and for

our clients growing are and PPA demand uncertainty clients to our consistent. the utilities, and from expecting clients They to surge or been even largely remain dynamic, demand potential policy higher corporates, to staying projects pass-through has the in landscape. near-term as our prices. constraints accelerating they in changes the monitor in their tax buyers: supply, course bullish from The through Underscoring are feedback tariffs this remarkably With meet any credits near-term hyperscalers, municipalities. the

as as community in opportunities, expands partnership pipeline and innovative for clients' business innovation our we and by Meanwhile, tailwinds pipeline. our Google, which models programs anchored co-located new such such and offtakers corporate also our seeing turn, data all are and, centers growth Microsoft for solar

amid growth. short- do for working favor changes and we the and So long-term in again, have fundamentals our uncertainty,

pass will these discuss new I it opportunities. Marc investment to Now to

Marc T. Pangburn

short-term Susan. incredibly role. for and you, tremendous excited my I new fundamentals HASI. market for am investment Long-term are dynamics creating opportunity a Thank

largely few unchanged investment I'll with shortly. enhancements that a discuss Our will strategy remain

assets enough our is $X.X capability It we that past to we the will set well, Over the climate years, X expand meet model. exceedingly invested working well ahead. billion, have our approximately utilizing opportunity clients'

previously long-term macro trends opportunity. and I'll and Jeff highly have supportive the resulting Susan the on start discussed XX. investment Slide

policy-driven we In addition long-term see support to short-term the trend, of uncertainty. also

our a our in in stress to cause to capital we position have and balance been will never liquidity, stronger relates access markets, end as uncertainty it While sheet.

lead areas in on to X XXXX. us dynamics These focus

First, continuity.

activity, investment our an As we shown continue attractive QX to with see environment.

business. Our adaptability. approach the we core also Two, first our and will grow priority is is to showcase working, our

example it. is do to is uncertainty the we SunPower A great from opportunity anticipate not While come bankruptcy. optimal,

a strong are the our assumed servicing prospects finally, and While business, to growth record platform And SunPower have identifying track an of the unfortunate SunStrong business. event, about we invest. of we this areas new excited

As growth investing exploring time additional in up new dollars such, anticipate particular, we end and opening new paths markets. and

I'll our entering new to classes. Moving Day, to X that our Investor on attracting On work XX. clients primary for growth. with growing 'XX provide and to paths our we context us. Slide new clients, paths I well existing have some said asset These growth:

Over acquired invested we XX the of FTN X and new clients with originations clients, years, have existing XX billion business. billion last $X.X in $X.X our amassed

continue we streams enables Today, new certain in both with X opportunities handful these clients. few investments and a or platforms. and in a the evaluating clients. investments incremental and Fourth, A vehicle focus and revenues. outside include to X which will existing investing Canada more. forms on of acquire We U.S. servicing assets of small examples are XXXX international long-standing to made fee SunStrong, recurring with Fifth, paths

as the opportunities We investments given also potential in reset platform view valuations.

where resiliency. of activities element generation, opportunity The new is XX. underappreciated transportation classes is in can our our which our and scope. of molecules, change cover our addition XX classes Turning Today, clean spanning a investment business, be Slide investment we asset asset potential step to see set. electric One

powered renewables. X the years, Over coincided with in have last growth business forward, also the renewables massive which has

good there. RNG of but as years beyond all number and X HASI. asset efficiency. goal the not these This of stop for currently started succeed or launched classes team on a tracking a will of We're will the ago FTN with energy growing We listed our be slide. fit with Not renewables

and scale entering select few a our growth major be business. of However, for driver that a diversification will

That or is kind to Ultimately, assets emissions that a are environmental breadth invest some to carbon reduce benefit. to opportunities different of or our provide invest. neutral mandate in their either open that of leaves of

and CCHX I we into report remain exceeding our Before the the closed to pleased partnership. pass year-end, call transactions of we to of that I'm $XXX fully million to is Chuck, as on CCHX expectations, deploy have as planned. capital track

our pass soon-to-be call to that, Melko, Chuck CFO. the With I'll

Charles Melko

Thank to opportunity of excited this can and ahead. forward our about I'm looking role. and you, in I analysts appreciative what each years I'm the working the Marc. with of to bring investors

XX, our highlighting Slide On metrics. key are we profitability

across On adjusted years side, can capital-light see for EPS, the our growth that of over metrics: for our NII, adjusted the you income. key income for X meaningful our for for board capital-light recurring right-hand upfront have the had past XX% XX% and CAGR XX% we XX%

addition, our XX%. of EPS, primary a metric, to new was Adjusted In an XX% high XXXX, $XXX of NII in adjusted grew $X.XX million. increase

million sale, XXXX, our to for business which continuing securitization value are totaling XX%. We $XXX and gain on with up deliver income from is our fees securitization

Moving on to Slide XX.

grid-connected, split to XX% with near-term opportunities. something largely investment that from which near-term and billion, $X.X on pipeline And XX% to public our and ample behind-the-meter, see was earlier X is much greater Our pipeline, XX% of FTN build policy already it continuing insulated upon highlighted changes. development all in than markets is is any

XX, closed $X.X just billion of $X.X Slide we a in XXXX, record On QX. transactions closing after in billion

our Importantly, business. diversification wind Also, contributor our year, the a and you this the Each of business. slide, total show is interpret leading asset can to to tend strong. continues our from go-forward to remains classes the as activity powerful small level slide rotate

Slide XX. Moving to

made XX% CCHX million our As XXXX. of up billion of our XX% partner more totaled managed $X.X is on assets the balance end year-over-year at of sheet. our increasing off and share balance $XXX $X.X the billion of $XX.X for of approximately have the year, This our portfolio securitized end than assets sheet, of billion, and we

mentioned Marc what million of commitments to CCHX, the $XXX end we as addition total have of In of on funded XXXX. the

year. in portfolio rotations our from lower-yielding increased $X.X of despite asset that earlier the the XX, XXXX million we Slide completed to assets On billion X% $XXX in

The of been year. to paydowns the with our environment adjusting meaningful at We XXXX. interest yield reinvestment our pricing a end new at and XX.X% in the investments higher-yielding yield compared the in exceeding higher-yielding successful investments rate X.X% principal have new weighted X.X% the increase average current in our of to portfolio these portfolio to of coming into in contributed prior the investments

of of average volatility. over margins trend debt we On of positive portfolio that our can proof Slide is and XX, higher preserved interest environment, from as pricing have rate grow see similar We that our yield and pipeline. you successfully successfully a the the in trend can cost, our business in rate this in interest potential our believe multiple we are periods seeing deals the

cost program actively our and focused costs, rating manage continuing successfully investment-grade on of capital. us our drive are debt helped Our hedging and down our we to has

to realize investment-grade our just benefits beginning are We the of rating.

than our the in refinancing benefit in investment-grade maturities of upcoming combination of pricing us liquidity the to stability of provide are a expected within to of to historical as to Turning our flexibility the ended The measured billion with the Slide transactions. debt Xx XX. the issuances at by X.X debt our our greater completing X.Xx. and and year of available our market liquidity and leverage, $X.X We relative target ratio, debt-to-equity future remained range our

from of debt addition, fixed our increases or In is hedged protected and in rates. XXX% either

portfolio through capital XX-year cash million million transactions, $XXX have an for been revolver. done our and QX markets recent including $XXX commitment increasing, generation, levels and have in our so liquidity additional we Our additional issuance

liquidity to pipeline. growing use addition our we to will plans, fund this In refinancing higher our

short-term savings our program borrowings have generate issuance relative other to a will that initiated also We on sources. commercial meaningful paper

his to Jeff for that, closing remarks. I'll with pass back And it

Jeffrey Lipson

our and Thank Slide quarter that you. sustainability Chuck. Marc last Susan, sustainability metrics, we accomplishments XX, our and as of along On provide always, you, primary some Thank and CarbonCount WaterCount, have received. we with recognition the over

on Slide up Wrapping XX.

and average proven our we Not with XXXX, and continue with been XX% growth We earnings are investment achieving only but business a our to situated has our our compound EPS IPO. strategy, balance targeted coupled position, XX% liquidity strong in sheet adjusted our an was EPS since incredibly growth are scaling growth. poised and

a business has a changes to to adapt produce that to highly demonstrated ability resilient and while growth. business continuing demonstrated We have policy has cycles noncyclical model and -- earnings

and with an to for in like confidence that look further dedicated optimistic XXXX. We for have guidance as and outlook year our XXXX. reinforced we have outstanding I talented would forward business thank success team our through to an

for line open please the Operator, questions.

Operator

[Operator Instructions]

question of first from Co. comes the Our Mark & JPMorgan with line Strouse Chase

Mark W. Strouse

can. Great. there. new we go Congrats questions to to few your wanted Slide on back if A to roles. I XX, everybody

Just when the kind kind you're risk-adjusted to the of And that? expect how least of can today, these as maybe about about think thinking some of added just around the of be when should far how then to timing could returns, about start, you just of it talk we to at opportunities portfolio? as kind

Marc T. Pangburn

Mark, thank the you question. for

these with provided, So imagine timing out. much extensive you that can a near further from some are as are but of and others scope, as the we within and perspective, term perhaps tangible list a

in long-term as changes and risk we pricing zip flows In cash the in as context think near to a we terms of see with cash classes similar are infrastructure that what flows very forward. they But that obviously, move are the as assets contracted the some you would of adjust us to will I we price we're for them in encourage code similar enable and of today doing term, a to asset we opportunities today.

Mark W. Strouse

quick then And follow-up. just a Okay.

goal that change you new So too? might about scale, reliance kind on the partnership into not about going scope there other of these expanding. at? example, Is that reducing your after does KKR is that, the Does talk stated your private the of some public obviously, of deals or into looking markets, Can anything the verticals fit these that you're markets? the for you're capital expansion

Jeffrey Lipson

think in the the funded way any asset historically classes which we way fund I we've Thanks, about to business. than Mark. No, these the new wouldn't be differently of different

think don't I more so less capital And or any would in result they raising.

I consistent would think they a have strategy. funding

ourselves presuming them a we as would same As Marc risk fund consistent profile, the funded we they exactly said, had historically.

Operator

comes of with Our the Baird. line question from Ben Kallo next

Ben Kallo

Chuck and Susan. Marc, Congrats,

are the on moving it's billion, less just still of I know deal you maybe with Just $X KKR. quickly. half than the guys next but

to understand you're just so partnership. well. of type then others follow-up wanted And the or as a have similar of about And with I them what having discussions kind I a

Jeffrey Lipson

the So question, for thanks Ben.

Although I we're would in discussions. say it's not premature, little a advanced

think said have a I've we vehicle. we next yet be would I expect before, would our of with capital a to to permanent what's co-investment to our others but structure, anything CCHX. have don't I co-investment ways go you strategy and part as say, to existing after on I a say

Ben Kallo

Okay.

you have to question about if in should XX. kind as or think back technologies all maturing running talked if Just Slide out have of of or on we I we your been capital that guess maybe Mark's think moving internationally, opportunities of of areas on should Or more the you're deploy it that going -- doing. above. bread-and-butter takeaway, you guys too. you know guys the that I to don't just

of maybe these then just the why move and internationally? list frame kind So things like

Jeffrey Lipson

strategy to today is it out upon in a of I'll as I expand the running XX, the column capacity. reflected Thanks, say opportunity Ben. and Page would But an middle Marc of on answer. somehow not start my definitively, give asset Maybe reflection

base we in a the the and think client have have classes great we I today. asset opportunity

And vision might to his notion created But think asset where front in wanted would, business, role expand out want both new classes. to and this of of terms Marc, we get we've as in business really for the this we of him, geographically describing any in expand. in that I

Marc So anything head opportunity that. not with I contextualize concur. nothing existing We're opportunity Thanks, to add nodding an No, add. his that he's I but would though to certainly business. it of that in the out Give to framework. running

Operator

Jefferies. with comes Our of next Dumoulin-Smith the line Julien question from

Julien Dumoulin-Smith

on of Congratulations Nicely rolling there I guys. to the as nicely And all well. the maybe appreciate done. done forward here. guidance you also updates

rollouts? year In think fact, the consistent this of do like manner finish cadence rolling rolling ] the of a you X the forward start prior as kind you this forward, you'll disciplined, versus guidance going in kind Analyst [ of forward Day

Jeffrey Lipson

Thanks Julien. the question, for

at think long out you've years know, multiyear any generally as exactly because it have how a of in X a we've And moment. time. couple can't we'll the have obviously more guarantee had I But ways, done we guidance. I consistent I visibility covered different consistently guidance of reflection the multiyear we've a think there been business. think is future, and you do to on the it with given us confidence I we've but there out

Julien Dumoulin-Smith

No. and to view. the long-dated great on It's have the now here affirmation

role. evaluating In the that I the little strategically the the folds reviewing see what I about here, more is fact, next a for as want question. in go? that about can you more you to emphasis strategy. into on it maybe Marc, itself? the Maybe you guys new creating as labeled just bit company mean mentioning the frontier" nature slides speak "next Is to to role Or direction strategic

the given we've few the number given growth of frontier, scale kind about gross asset origination thinking do is different 'XX. of new I a know you all 'XX think now kind origination this But And that you're then think of to heuristic end talked good as there could markets, on what about the times. terms maybe gross in various next that you trajectory, and now this number? that a about how related about

Jeffrey Lipson

Sure. I'll take of second that Marc allow answer the to part first part. and the

a is as title involve let answer new strategy. some part investment second times, at focus our strategy strategy. I'll primarily that Marc the of may driving it certain the matters investment the of strategy So corporate more think It on Marc's question. in but

Marc T. Pangburn

the thanks question. Julien, for

the basic primarily a grows do and perspective, organization think that deployment general investment our and so around from on The investment most capital. we're through forth, earnings second that I thoughts of part an volumes

is activity front. always course, And so of that goal, our be increasing our level on to of

course, and much increase to feel we We, are very I'm good desire people have forward very to from level can you our this platform, capital activity. the pick But looking that activity and expanding the balance our capital sure the with about of up platform our the internally. call of people we investment

Operator

Our question with from Moses come BNP next will Paribas. of the line Sutton

Heidi Hauch

Heidi is I had for This on Moses. just one.

asset tax reduced expect a opportunity pressure So in credit event your customer? whether the Or positive are funding line the the emerge average that capital that gain from or considering adders would and the the in could credits actually the tax time whatever investment for in prospects? specifically base face you or magnitude, stack to would greater of this reduced monetization, your gap be

Marc T. Pangburn

I do incrementally, So yes. that think

of capital particular equity, investments. of cash tax equity. generally we perhaps our think And in about you the debt it's participate a where some stack equity project, and is If comprised cash generally

would imply would equity of of go there's that would the monetization sponsor gives opportunity project. gap there, rate that that higher level through is also tax a cash, and that imply PPA in that any a one usually the increases a of if the down, and amount So us more passing

Operator

line Noah Kaye of question with next comes Oppenheimer. Our from the

Noah Kaye

me of areas already at quite that the of growth it's some my the your to see of XX are already buckets add It Slide have great strikes are I customers so. to evolution where will and I'll least return done around who existing these organization. the next active. some congratulations continued doing and work those to frontier. the And

new about maybe need relationships. existing Marc, where little you leverage So what a from some you some growth to going actually have to into think talk relationships areas you're might and of and to get these build bridges bit

Marc T. Pangburn

Noah. you, Thank Sure.

when is think model, about the you key think our client dynamic clients' obviously, assets, of I the climate one pillars.

RNG of time we done been acquiring, be job with you are think that example. business is a our give retaining will example I'll again, course, I have, expand we then but lines. as that RNG. into of focused course, Ameresco, and how of one They, on the believe, was out our has an first over Ameresco I very clients. clients, longest-standing -- very is, of good their all And And something And of investment figuring

So our there again, to we'll these think business focus. continue will of be to of opposed and asset model, on need as with agree, some classes that focus where clients as are a we'll continued new it. I core But And I to a initiate part existing.

Noah Kaye

growth it's on been cadence about a EPS The from a as or outlook gain past the the on any help this of sale? to year. 'XX, of the was of drives big year, that's on And informing support you consistent kind gain this us think includes have we're how level kind reversion earnings for of that sort on growth year, pretty since strong going sale little multiyear this color to 'XX, insight some next more you of 'XX give what much of with the bit if it a just Can not normalization? then

Jeffrey Lipson

Thanks, Noah.

bit attractive replicate. 'XX earnings sale gain number the asset that client-related It I of to to related gain to sale. would and on about rotation, allowed think is to us to achieve hard a an otherwise significant had outsized 'XX was 'XX very wasn't way it growth. think related a to and gain be on

So will otherwise revenue gain we'll other other grow like Clearly, client-related on consistent, accommodate to grow year sale. this little and our the gain streams given streams the we'll remain look on may in a sale drop guidance. revenue what

Operator

Goldman line the comes Lee Sachs. with of from Brian Our question next

Tyler Bisset

Brian. for on Bisset Tyler is This

harboring. pipeline. with you safe and protecting You a call structured with I your harboring who's recently safe been noticed out closed grandfathering active And equity IGS, capital partnership

your included so, wondering, you closed And just was any harboring? And potential that for XQ? safe are seeing in So transactions what to opportunities billion extent? all $X.X in near-term at in if

Susan Nickey

of know advantage last Thanks. in or Yes. start a uncertainty. really our the of given took harbor lot construction safe to I the opportunities clients industry that year

their So and period they pipelines protected for a pipeline. turn, our continued protects that, in

will give versus I those insulated place. in as lead but is opportunities us think a in to themselves plenty projects, well. pipeline will or could facilities, Whether to think, our good safe harboring invest of part that come the new of that not being I

Jeffrey Lipson

just part I in a safe the And answer question, other quarter $X.X any billion don't was fourth the to direct believe of the of with transaction HASI. harboring

Tyler Bisset

your Super strong helpful. for transactions has you to bringing in you closed year, last that, XQ, year, And of did which as piggybacking the of obviously kind off billion was increased. but the $X.X same were ROE

opportunities Could we So in wondering viewing for the this year? you're increase just how transactions see XXXX. volume

Jeffrey Lipson

You may volume see increase.

premised we course, is of on think But guidance may, exceed I volumes. our the to in flat overall guidance. slight increases

So billion. increase But over it's view in you would may increase see as -- XXXX. modest a relatively some $X.X the I that

Operator

next comes RBC line from Chris Our Dendrinos with Markets. the Capital question of

Christopher Dendrinos

You of and then forms outside new of new U.S. highlighted growth paths investment. X some the

the bit make was opportunity to how of guess, that I acquire unfold? Can transactions, assets opportunity things leverage guess, What there walk out do the a And as look those and just, you more? there? you platform. like well I new it a pointed as SunStrong the and One little through that into servicing set does

Marc T. Pangburn

Sure. Chris. Thanks,

the assets partnership partner they business went that bankrupt, the a background platform course, owned. of of the -- particular SunStrong an that, on SunPower servicing And that had of both So SunPower. that, a business. itself, with we partnership and is this we servicer partnership equity the course, was assumed when

business is that distributed servicing today. solar management and business for so And an asset

an generally the through opportunity and fees increase do running receives revenue we then grow which, to recurring recurring of would these see And of level the that its fees. And so statements in as ours. eventually course, of form platform financial it such,

Christopher Dendrinos

Got it.

But as just on And mentioned one it I of question housekeeping you guess Okay. and then progressing kind here. was planned. maybe CCHX,

the this year? is that transaction the funded year? this total that end complete there. does volume leave it fully of is it of by by it I'll mean just is end So Or And

Jeffrey Lipson

So of I is will the CCHX first would right we've end the XX think previously, XXXX. what roughly which and said end on $X stand target in original the billion that of months by track, at that is

to hit original CCHX. So volume I think projection we're in good in investment the track of

do committed funded. If also to with that had versus question

a then one a there's in later. funding of clarify, to of and the Just is occurs it that investments, nature our most commitment that period

months fund the dynamic original So consistent to after in commitment. that XX is is rest as business. And in months from can the CCHX XX of our anywhere investments it to X

Operator

comes Bagri Our of next from Vikram Citi. question line with the

Vikram Bagri

stress Are the more I how you that your so pipeline? in have directionally Can markets? like -- to was delays, you ask seeing you that wondering markets? you seeing in if share a projects a policy wanted Are move Marc, uncertainties holistic I many what stress end you cancellations is on can of expand out mentioned view in comments end macro in causing the markets. seeing short-term question. you're that the given you manifesting?

Marc T. Pangburn

Vikram. Thanks, Sure.

some course, any markets but on based the characterization specifics end general infrastructure environment. Of of market people are think projects all are that of these differ, a decisions where the I of clear is that understanding make can that investment policy

the Either take If it increased make it you way, represents it. investing clear actually lack dollars, make and risk time extended are decision, delay ones financial have risk either understanding, development for the they're who that and/or that lines. is or who to that clients our

actions protect they've extending covered, is Susan many to in a as a are thing. But again, because bad forward general matter, themselves. course, usually as development, lines taken And of time plowing

Vikram Bagri

noticed follow-up, fourth saw on a you to in markets. which number in to I quarter? in the you confirm where I of entire the new there as ratio? ratio And reduces decrease was terms get is your question. also And a housekeeping want wondering, note, on year. 'XX a related it. for asset target was in 'XX Can to a the payout what long-term a versus XXXX, capital payout reliance Got I yield

you was fourth share what for number If the quarter. can

Jeffrey Lipson

Sure. Thanks, Vikram.

going the XXXX, we question our would way ratio in first back a payout Day Investor that the projection hit X-year the all there, XXXX. gave to by On XX%

question. where after we're So we've I good that But payout with given headed What the think ratio. we've visibility we'll given not given the and headed, say. on good prepared on as we've I'll long-term of part Chuck long-term now again, well. XXXX I'm other think interim where XXXX, visibility let range very answer that's do to I

Charles Melko

this Chuck. is Vikram,

So full to year number similar XX.X%. yield very the was QX of than portfolio the greater

Operator

Our next of Mizuho. Maheep the comes Mandloi from with question line

Maheep Mandloi

promotions the for on here Congratulations everyone.

things the in just about on the you front previous how are that yield, if talk question, changing Just QX. could on

and renewals construction class You did the the if in for about talk manifesting extended you? business. projects higher some broader yields or of that's negative for asset in increased risk Wondering carbon in

Jeffrey Lipson

I thanks we're Maheep, a in But this change. in of lot QX. that say, yields we in has there's were, But about talk rate And pipeline, the obviously, similar transactions the same would subject I for if range done we're the to question. point. in pretty think terms movement, pipeline the going not at I think I we've XXXX. what to to that's think, clear

Marc T. Pangburn

reference be take, You the were made policy is it just or would to that to and made phase, uncertainty. risk we a would tend around around to development I during my relates decisions to the positions not want but you back clarify as us which we think I before to risk, answer increased calling that, that more get involved. the

Maheep Mandloi

it. Got

in. your in the modeling the construction for for like investments, or more but when there? of pretty for any differences a just or our expect this else Or you remains opportunities, perspective just you a much just back guys XX, do on it's from yields for going the seems funnel early, probably new assume -- these And terms it purposes, expands later same to [indiscernible] come of everything on bigger and tenure pretty us? modeling then financing I at know So than risk Got these bridge Slide separately, it. stage financing

Marc T. Pangburn

Sure.

asset premised modeling I classes today. So that a want to would in the that One, from Jeff on out the perspective, laid comments. that we invest couple of guidance is a clarify

suggest as I that continue the have so would you been. business you modeling And

asset that in of flows a asset contracted. seeing Mark that infrastructure cash long-duration as we yields of when we're way I the it similar of on that I assets In at believe are TBD. looking in with very these at these look classes, question, being some terms terms But mentioned, classes existing our generally is new asked we're the

And so we I would have think of the risk return to be somewhat what similar today. to

Of course, over they evolve adapt time. to will as we markets

Operator

Dimple line Bank next question Gosai America. with Our from of comes the of

Dimple Gosai

you underlying little How you which the of relative size in mentioned of kind XX. I details geographies ask of you on to about the types you of opportunity to and terms the would opportunity, that the more Slide U.S. just terms wanted Can in international pipeline the that? discuss kind of TAM sectors of a the growth? frame bit underpins asset classes,

Marc T. Pangburn

Sure.

the I what So would small And ourselves. that our like a different not anticipate been indicate portion that way done much will enter would we first, tried overextend we remarks business. many I has very to say, I prepared in to the date take to we've of the markets, and time

the would I business about term. focused U.S. heavily continue to the So being think near in as

to then One to with the call just again, business. of wanted doing people of put what U.S. think continue the pipeline this near-term to we to scope majority of I out a of grow the business of But continue areas remind we're that perspective, to in the is the from our and a

Jeffrey Lipson

is give an remarks, is more strategy a overwhelmingly in the existing add be I zone. that us likely Marc international would something of which prepared which will did say already to with And client, comfort actually

geographies us little a our because to to what we'll it speculate on harder pick makes see show opportunities -- internationally. clients it So

Operator

line from of Securities. the Our Levy comes Jordan next question with Truist

Jordan Levy

of your if growth remarks, or I to this mentioned well terms to I be think investments given wanted was valuations. areas of sense additional mention as made becoming of the investment, that prepared more of expanded of attractive get Jeff, maybe the you some possibilities? new Marc sector reference historical of sort in into target platform or a forms to in could a including buckets just whether

Jeffrey Lipson

both. answer Thanks, those fundamental I to Jordan, thanks of for It the could in buckets. and I picking be coverage. think up either is mean that question

consider something, valuations, with been of business part prudent level. it's the we reset our in It's be at think our should in if opportunity given to valuations, be there the the about. core specific think want a of I you this business, itself part might about and presents it. not But asset reset that again, continuing a core we to is

be. wanted that it's it -- to might mention But of Marc speculate make what would So it. to hard be again,

Jordan Levy

the particular bounces set in around And breakout then follow-up and that investments strong a investments just the some for on new on seems opportunity Slide lot it new really C&I of a in dynamics subsegment. a Maybe you're I particularly. like know of but year it just year-to-year, XX. seeing

Marc T. Pangburn

business. lately, better our in primarily continued and solar seen have that and our solar as That we've on of some think a again, market business And Sure. on. I is But we where opportunities. more been focus less storage and focused BTM would the

Operator

And the next of Securities. Riley our line B. Ryan comes question from Pfingst with

Ryan Pfingst

all? facilities offtake? RNG side, Does in just have prices the DX mostly volatile I'll on Or looking at one that been are you ask process affect bit a price recent RNG your months. with RIN fixed investment at

Jeffrey Lipson

But tranche pricing RIN the it view day, debt. in is the of would that watch senior underwriting, and and we closely. given we certainly I say are a to end RIN it's exposed prices our projects, capital of our these don't senior be debt in at RNG factor materially we to

we protected in a but perspective are cash these investments. factor, well a from it's So flow

Operator

of concludes -- you. session, end we this today's and this conference. today's Thank have question-and-answer And concludes the also reached the

thank time, may disconnect and for participation. You you at lines your this your

Hannon Armstrong Sustainable Infrastructure Capital (HASI) 13 Feb 252024 Q4 Earnings call transcript