NWE - Earnings call transcript Q1 2024 | NorthWestern Energy Group, Inc.

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Travis Meyer

Thank you for joining NorthWestern Energy Group's Financial Results Webcast for the Quarter Ended March 31, 2024. My name is Travis Meyer, I'm the Director of Corporate Development and Investor Relations Officer for NorthWestern.

Joining us today to walk you through the results and provide an overall update are Brian Bird, President and Chief Executive Officer; and Crystal Lail, Chief Financial Officer.

[Operator Instructions] NorthWestern's results have been released and the release is available on our website at northwesternenergy.com.

We also released our 10-Q premarket this morning. company's to this forward-looking your the presenters comments statements. that responses and questions note press presentation, release, by Please may contain

our second slide As disclosures the presentation. safe you direct of provisions SEC in harbor the such, the filings in to included and I'll contained the

be Also, this recorded. today's presentation. the The financial non-GAAP is being presentation for website. financial the our of Please see available in please disclosures, also definitions beginning section results can will p.m. included archived year note The webcast replay today non-GAAP of Eastern the and be includes at measures. reconciliations X are webcast in found X:XX and

to that, Bird opening for hand his presentation With I'll over Brian remarks. the

Brian Bird

system. week week, we in valve Travis. Brookings earlier X of matter customers had renewable natural in to we a will turning -- be of gas actually, natural of X/X Thanks, were projects, And those receiving on gas. with Dakota our fact, our we Well, having the South were fortunate in of the Dakota event the on coming first a in the renewable this residential South more

in XXXX. that's So

a those on, very helpful projects about more we we're goal. certainly handful zero for that coming and by net So excited our XXXX have of

Dakota. very, fortunate our and on dearly. We're Chair's our Board annual in icon meeting. was the at Board Dana and week, we him meeting, Brookings an member, And miss this years it been the our in in XX fantastic and very him meeting, on a the Board the had South of latter will annual he Dykhouse after He's Board. which for up also, half have Board, a of been morning we finished last that out to state is termed meeting, We've

needs $X.XX guidance going our EPS share X% $X.XX. GAAP diluted long-term growth rate talk base EPS per our diluted of the that, We're XXXX. as XXXX. We've $X.XX, highlights declared to With June $X.XX for dividend we Montana XX, for record of XXXX of for targets and We're to anticipated financing $X.XX debt X%. recent We've of of affirming Electric of completed also about quarter diluted XXXX. share have affirming our of quarter. The to June per rate the Rate a of payable to XXXX. earnings non-GAAP -- I'm reported Gas and EPS And Review the Montana XX, shareholders for third XXXX we Filings

for it Generating prudence include -- will Yellowstone that Electric, County Station. will Montana the And of the review

shortly recognizes communities customers, will unique moment. a Shutoff, Mitigation We and addresses May, will new and I'll be process in the to Public responders. first That Wildfire that and here in more Plan. our speak plan needs of the Power publishing also include plan our PSPS Safety our

top Our X% Northwestern the of gets XX% plus of growth a great I in Crystal plan here sitting X% that, capital to dividend yield base through you today will presentation. dividend value $X.X that think, a On to later and to But that proposition, have X% following speak more to opportunities. X% our rate return. EPS and X% incremental total with on some we yield growth billion,

for our U.S. course, electrification for support an FERC jurisdictions those that investors. explore that We're necessary potential with development. seeing both transmission in PPAs higher contracts incremental return electric generating total QF in than investments, and and in some some buyouts We to capacity And from evaluating see opportunities, we'd continued continue most perspective. in jurisdictions, XX% growth the economic we're of incremental it just

for on comments pass quarter. that, it I'll Crystal With over to the

Crystal Lail

at sheet performance quarter in update on on plans an today we're cover execution our financing our the comments and for a capital will balance for financial where the overall My year. of the Brian. bit and first you, addition side to Thank

or From which provide perspective, As Brian improvement and a will onetime on fourth weather compared rates year. led with in $X.XX a a bit versus a $X.XX quarter million quarter, basis, non-GAAP first the and by EPS noted, more They management. These items of details or of a last I X.X% milder bit XXXX in $X.X solid delivered expense tempered financial $X.X of new for adjusted here that to, driven a net impacting the to from an million On the income basis importantly of by X.X%. minute. GAAP a quarter were performance quarter, quarterly XXXX. strong we increase the results increase a were few

Moving after-tax as compared the XXXX share This in to to per QX change of diluted you X. Slide drivers for slide our XXXX. highlights earnings for

our XXXX. You'll for by year of utility strength of times rate driven Montana margin new we of quite the have $X.XX, electric impact note importantly, execution full regulatory that we is what a talked a the will rates and the gas higher with really about Review few

that, Dakota there In concluded the electric rates January. and final review addition received to rate South we also in

the So us. here of first driver in you a for see quarter results significant

In an quarter line those of $X.XX outcome items O&M I the the at included to highlight and versus Together, a that, you'll XXXX. detriment also that impairment first would $X.X. of is addition that impact. note O&M expenses about $X.XX in for were increased you litigation

litigation XXXX. also interest that in solid would see depreciation -- which from impact first year. $X.XX and management cost the remove of quarter line, $X.XX versus each the of outcome, lower would versus first subtract impact O&M the quarter note the So that actually in result expense $X.XX increased that there, impairment of and last the you O&M you sitting Also if

$X.XX adjusted earnings had of $X.XX all on and leading from of GAAP impact on shares outstanding, that we to dilution basis of basis addition, additional $X.XX. In diluted a of an

margin. X, more bit a Moving on detail utility to Slide our

from volumes For from of driven our rates lower January the and and driven by milder $X.XX by about services. new primarily $X.XX an event. that offset $X.XX the quarter, impact a from by of PCCAM transmission margin Montana driven $X.XX by was weather bit [indiscernible] was of weather and cold were These improvement

February about prices I think that we saw over and spoke to our call we our hour $X,XXX customers serve event. with power megawatt at storm procure a that that in you

You in that our in here the detriment PCCAM noted QX. of at impact $X.XX see

our the we adjusted To a highlight bridge provide X, details detail. things covered Slide our of earnings. in just couple I of that

of impairment add-back $X.XX first to gets the energy and by earnings, So a you'll the of $X.XX this, unfavorable netting investment, the started of XXXX. offset to side with netting the on left-hand items, of which you we in the back then is of $X.XX quarter of note QX penalty $X.XX that, add the storage-related a weather in reversal X XXXX, of earnings

When you first weather. we have quarter, compare significantly that to last year favorable in more the notably,

was we last it. year really Nebraska. South in milder, all So And think we about It lot Dakota, in this year, it noticed Montana, a where and cold QX was live. certainly

year. you add-back last $X.XX a So saw

or notably, which $X.XX So we was to compared a is X.X%. being increase the item impact a All that in then we had to in tax said, X earnings year. adjusted that you last the earnings a see adjusted $X.XX $X.XX us quarter, that say, versus of And had $X.XX prior earnings of swing also, quarters. to that

balance been to further our Moving strategic sheet. us A Slide for has XX. strengthening key objective

of about our and our cash importantly, the have very that which utility to been to we disciplined regulatory talked flows. execution, We our margin impact about and

agency such metric that, to many am that know here In perspective. of quarter capital FFO-to-debt over that that addition I disciplined to downside rating credit closing us happy and QX, at from that concluded you we end follow out of allocation, is say the the our as our threshold is XX%, a

we're balance really see sheet where from So happy disciplined perspective. the to us couple execution where very we about leading a point a of in the happy last years are to we're

executed closed that, financing In no financing for our on but financing our addition announced which during QX, to for we year, the needs, that and have needs plans debt had out equity, XXXX. some we include have

you will already affirming that noted guidance are Slide for reiterate. the I has we XX turn earlier year. our to and Brian

earnings that targets where up X% rest about of our per XXXX. an with we So to rate, execution of guidance we of for reaffirming with from are And those to X% we in guidance in a QX, share base setting $X.XX. solid the consistent good feel from we are our are is XXXX and QX, and long-term where growth $X.XX earnings

what we incredibly Slide is driven investments we're our Generating and of sure and to investment our such XX. to of our supporting are need customers talked to I'll our highlight by We most many Station. times, million capital well, $XXX We're track the happy resources making our our critical our Yellowstone for here most. as County customers. system but the XXXX track importantly, when County serve capital includes over on about base completion really importantly, for needs Yellowstone but serve and and on forecast serving they this customer also to say that are it forecast critical think ability them

that, with turn it back will So Brian. to I

Brian Bird

Crystal. Thanks,

plan to in we'll beyond, more one here talk many about in Just wildfire AGA and released when we plan we you here about the of page it after talk meet at detail early just the May.

this time the hardening period, very, commission plan, in doing last main think terms and the perspective trees everything front to and from review, just hazard mitigation many place in foremost, our we to forest-related our plan, rate with of I that. think dealing ago we've first wildfire I XXXX very not procedures XXXX through other a really for long thing put good issues talk decades of in putting last system with deal before captured and about, just the in in kind actually too of been

year and it addressed awareness, be between will safety plan have plan. and communication see on public you'll we where area the One better major adding executing of And we a amount last years upcoming public and was is, to monitor, a basis. are you the power and then in one system outreach couple within The continue technologies this to about shortly in tremendous from to now a think difference all going-forward do back situational going much that job here a this more on and done we needed that. we we thought process plan shutoff be work other if

different And should of very, this than and some sit our of there's segments are terms is, many each page other distribution to we the X% detail. see particular customers point we be segments, so today, category our our again, say down very, One going transmission other I Montana X% fine as been we electric about is in only of significantly our risk. PSPS from amount to And pretty thing manage the highest our utilities. potentially risk in might by that you impacted of for would assess on I out assets. here have -- have of We'll segments

helpful. also that's So

wildfires spots, that this know can and to May plan. really system talking accordingly. our look after start we different a in we'll But at forward in that We release we many look as about continue whole the and manage more to

of the Commission we're Montana the One release -- of reasons as Governor X plan, we with get preview will be be the as waiting meeting releasing on we'll Montana after. to a May Public the well Service it, shortly to

this. steps taken excited we're So about thus we've and very far on the continued progress

to thinking about the in with noted standpoint, the are customers we, as and customers. And line stakeholders. we're a and that, industry of are strides like trying trying From recover really our perspective, our support concluding the customers And that not a of just on the just can, those continue, obviously, investment 'XX, And going-forward we're we increased company, to risk making mitigate here, capture, reviews. be best in think I -- sure to from but serve making we great seeing making we rest of as rate to our going this manageable all appreciate for just you've inflation as with are again, I the basis. our

And . to turn it to we'll any with Meyer that, questions Mr. over handle

Travis Meyer

Thank We'll Crystal. Thank Jeremy you, first our Instructions] you, Tonet take Brian. JPMorgan. [Operator at call from

Jeremy Tonet

provided you release yesterday NWE EPA to and I announcements what's forward think on impacts just the thoughts there, at follow new? guess, off, guess, wanted up, start to some given this had new in want the you I how this do point going press that Just

Brian Bird

Yes, I would say this.

But capacity NWE, impacts our think about say perspective, in have this as how a I our to to we drive and shortfall makes From we that news, adding going good. primarily obviously, we start. impacts I from that, start help Colstrip Montana when is still us sense. concerned our this incremental was perspective, not believe and you customers great I'm certainly think it

our serve to I on puts think significant the decision reliably risk customers. our a ability

we decisions customers. short-term I that direction us here, go we, like that I think think to our everyone impact every could to cost-effective space, effective. could resources solutions our it utility provide to the make in of customers, company cost capacity want serve a technology to sure our want want to for And cleaner again, proven force for to instead to other we more with do promote ultimately able way in customers aware I but make obviously the generation down to affordability the is that's long-term be

and and from standpoint And a unfortunately, around to these those resources trying in going way, to no XX have and makes in standpoint but absolutely reactors to are that's able short-term probably within years I again, anybody rules X do by perspective, going decisions an you, the that, or do customers to available my to From to -- and are think, making. it that, sense. certainly result here small until be affordability impact be something reliability effective, the rules what have cost years these changes make us making modular

So strongly Jeremy, think feel if about this, absolutely right. you you're I

Jeremy Tonet

there. That's helpful

Just could how be, if here might guess, there? there to you're I whether to challenges the that be you comment you able able unfold extent might to think curious, comment in legal

Brian Bird

Yes.

based we that think feel of litigation to around I rules our the expect from for all I we litigation whole is the the a and that. about think that perspective, upon industry -- the maths a going strong, believe think from I matter. very perspective, blush rules, around first this as the particularly they're

it will and to out. be -- see this plays how interesting So

Jeremy Tonet

seems to Got back it. get Montana there's going to to itself, it just And like guess, just wanted thoughts, I some I guess, and the for pivoting then, rate in I be the your next changes commission. case,

composition will have current -- any point case guess, term-outs, thoughts, with wondering rate or be given the composition moving if the at Just this in under on Montana or and the you, next elections strategy I pieces. what changes regulatory

Brian Bird

changes. think when obviously, not is we and I and that And Brown leaving change. reelection, strategy, seeking commission. you certainly commissioner he's there's President O'Donnell again, know termed the We say is be the can regulatory No, current out. positions commission, appreciate X will there

appointed to that our So there's chairs. iota. regulatory come who's going perspective, we our to change but be a X strategy matter sitting change, our with doesn't for It From good doesn't we necessarily sitting in those in working achieve for forth regardless commissioners sense, to us believe also makes what obviously, who's outcomes want ultimately but in customers as seats. and also those

Jeremy Tonet

here? Got potential do mitigation finally, coordination that it. trending? changes could That really legislative territory I risk there. then conversations just policy you're the watching or state makes to how sense service there in with that stakeholders your national addition regards are And guess, to filings, key wildfire federal in you with And see, wildfire the and -- any for

Brian Bird

question, Great would I this. Jeremy. you tell

EEI means obviously, this many and to going-forward basis. this early to utilities that level. as utilities electric plan we And expect session like, that at I will what innings with legislation me, mitigate see working bringing to that in and risk to on units try this forward. XXXX many wildfire in quite think, January be -- would different It's early the address focused on Montana around regarding we'll determine bit, issue, and working around issue. certainly think yes, this to federal we but look I a something to been we in the excuse But be appreciate state trying I obviously, the We has mentioned on a industry co-ops be mitigation. well, their other of

Travis Meyer

next We'll from Mizuho. question Mortimer at take Alex our

dialed who Alex. well it could under in Anthony As be

Alexander Mortimer

your I the you now, well in any guess, potentially that the of load plan? as right topic year perspective sort from given of to on seeing being sort CapEx of the sort industry-wide, of potentially load, growth or -- incremental you're can as upside just touch then given anything and

Crystal Lail

that question. take It's Crystal, I'll

it mind. to I think comes a come things load couple of when to growth

importance unique sit I we serve of is able Brian's to would our go being EPA existing County be a done, a on which deficit our in to the Yellowstone all, at facility First of and to comments of back position getting customers. the

Yellowstone of of would I our us getting steps growth. the on So facility completing and executing to would the EPA, think enable for thinking and issues addressing with investment options County are allow resource adequate criticality be next these to that load about what then around the

the all or going happen commentary are load the of execution AI what's capital South be Obviously, the on driving our the EVs with We're and both and with the in or drivers, partner on Montana there's that in current to broader very to onshoring those whether to Dakota, then of economic a we lot working trends that's things. support things development or that. and government a focused also want sector

there made opportunity first think and that. time. blocking of shorter amount tackling is in our existing us short EPA far just there. have of we the So And may obviously short we're serving is that pretty of and a of very load, lot But a our

Alexander Mortimer

wildfire then pivoting the rate to And in Understood. upcoming case. back

to You the the that accept mentioned it. or wildfire of addition sort go attaching reject, plan through to the plan what the filing or like, in of fundamentals Does the look commission or it just you like? process can approve wildfire is case going to

Brian Bird

Yes.

I think it's the early plan or not. they'll to approve say whether too effectively

and plan associated well, recovery we And many involved people stakeholders and plan. costs commission that to the with to be be of with that support fantastic. sure obviously, with stakeholders going of to need mitigation need going that, we're fire we're an obviously, our we going other that's the with, to want be if to many the would this, make and work service plan. to as that the think, But I all support forest want it approval, are that

Crystal Lail

just on I And would to that. add

If of plan. in in We as spending O&M as our in aware, deferral previously that costs Brian our to, Montana filing. continue it executing review. our you're probably plan upon discussion, plan incremental that accelerating of last support and will we rate in spending upcoming filed cost that achieved related electric Obviously, to to alluded recovery

Travis Meyer

not questions any other do our in we queue. And have

potentially. turn knocked I'll moment. on Crowdell Mr. closing with So wants to some question Well, a Brian for ask X that, hold it It like follow-up looks to and remarks. in back

Anthony Crowdell

want quick a not And Just may you follow-up. answer to it.

Just an year, we sure the curious we're not rate forecast interest the And through embedded has rates guys if have. curious forecast of you just higher. rates? any interest all I as if go if embedded company [indiscernible] I'm have that's

Brian Bird

Crystal, other First call, it's to do reason. any you because it not answer Anthony answer want there because you to or is do want not to it of

I think we I think first. need question that's to answer the

Crystal Lail

Well, To be I answer. way. that it's Anthony. if clear will

we comment, interest had here you but tell will First the what the less cuts. rate I won't than market on the embedded at is, you maybe higher-for-longer that a little -- NorthWestern potential number view, tell I maybe thought have upside

a Jay assumptions, just with obviously, sit plan have some where So camp But signaled Powell that. feel cut today. the from not And where as soon things are may I decide consistent and would we thought. you, about others we financing were we and -- not as tell have in to plan our rates managed good have may perspective that he may higher-for-longer

Anthony Crowdell

if And wall the Great. I apologize hit I again, just, again. then

the rate that can the I parties. a feedback parties', testimony, especially know some Yellowstone think term you policy to all file you is, from you like getting kind makers don't give related there I get the the case, it's you us, before not you're right need Any but together. Just of are

Brian Bird

associated file with we'll issues. then around this that talking start and those stakeholders Effectively, with

Travis Meyer

no And in other questions have Anthony. we with the Thanks, queue. that,

remarks? Brian, any And so closing

Brian Bird

and I to guidance here we're and get the obviously appreciate end No, continued just you. the to going of forge year. ahead plan Thank support, our for hit the

Travis Meyer

you. Thank

NorthWestern Energy 26 Apr 242024 Q1 Earnings call transcript