UTL - Earnings call transcript Q4 2021

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, and thank you for standing by. Welcome to the Fiscal Year 2021 Unitil Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. now today, hand Finance. Todd would to conference I speaker your Diggins, Instructions] like the to over [Operator Director of go ahead. Please

Todd Diggins

Unitil Good us financial you thank Corporation's discuss results. morning, XXXX fiscal for year and to joining

on Chairman, and Meissner, Hevert, Vice Chief be Officer Financial Bob President President, and the Chief call Officer; and Speaking will Senior Tom today Executive Treasurer.

other We call. will this discuss information on financial and

section we of in the website to press have call, posted mentioned this presentation, information, we As the unitil.com. announcing Investors our at a including release

We to refer that will call. information during this

the Moving to under made Slide of Reform operating future results Harbor XXXX. Safe events X, the statements comments forward-looking of today Securities Litigation Act about are Private provisions or the

to call on from and on and contained differ Statements we made Forward-looking other be statements recent should Securities predicted. Annual materially Report Commission. Form furnished to that statements inherently involve results and those this risks together our the most Exchange information uncertainties have and or XX-K with considered in filed cautionary with documents actual can other cause

call GAAP no speak the assume to today over fully evaluating measures are The to its supplemental believes these a includes President more measures. only of measures, update useful financial the turn these reconciliation Chairman, contains nearest CEO, in will financial to I performance. company The financial non-GAAP and Meissner. Tom now financial and non-GAAP as accompanying information With This we measures. describes and that, statements non-GAAP them. Forward-looking presentation obligation

Tom Meissner

the desirable we often not of Hampshire most along we the environmental utility, generation the Being coast. England, Maine on and a obligations in today. a today's of for pure-play have Unitil everyone. accompany own assets, any do good them. dedicated going large I'm to brief Unitil’s Slide serving morning, New is strategy. do that which discussion utility and a distribution New nor X, Todd, sea us the business distribution provides Thanks overview of some areas Thanks, begin joining

of our mechanisms. are commodity by result approved recovery not as a addition, In earnings impacted cost fluctuations

We the efficiency, over and have to fluctuations served cycles. gas. about mechanisms customers business residential, revenue of regulatory mix under expect we and our energy commercial, serve electric or weather, XX% we than customers by customers more end, across diverse be strategies, have XX% of Through decoupled which due a industrial year rate to our States, minimizes

we reaffirm net to were of continue or now Award, X. Emergency Moving to we per we long-term our rate-based income strong and higher plan, $XX.X and X.X% fiscal opportunities, recognized the to of investment but X.X%. years. share will I gas X% two preparedness an industry our Later for announced investment Slide and be Customer Bob at earnings Touching per of share. provide that refresh ahead, million mention the once $X.XX end a above range forecast high long-term we margins XXXX, to practices. results I'd with per share, year updates, over looking best-in-class strategic a growth and exceed growth few of reaffirming increase and on storm strong the an represents like expected again continuous call, of we standards, with wanted have Today, rest growth satisfaction for $X.XX both on electric an all-time to EEI remains X.X% improvement. X% continue growth operationally focus Response to next to our that on a high, with robust the over reflects Briefly, earnings earnings of and XXXX, the to in of This divisions. with adjusted guidance

underpinning continue on see key this to our of success. aspects strategy. business sustainability to noted embed as calls, as all a Finally, previous We we our into long-term

be company can report website. sustainability our on Our XXXX viewed corporate

with it our XXXX to Now, will results. further on who Bob, detail I'll that, pass over provide

Bob Hevert

Thank and I will everyone. Slide begin X. on good morning, you, Tom,

mentioned, Tom compared this Net to million fiscal per year increased or net higher by and operating $X.XX income we year higher earnings announced per margins, adjusted offset of increase As $X.X $XX.X gross earnings XXXX fiscal partially XXXX. morning share $X.XX. income expenses. electric The million, natural and gas by reflects of share in

Turning to Slide X.

XXXX. months $X.X margin gross XX an million electric growth. of For or adjusted customer fiscal the million XXXX, X.X% was increase rates to and driven increase $XX.X by ended year million, December The was $X.X compared higher XX,

Our territories. conditions in industrial by economic commercial and unit sales X.X%, reflecting our improving service increased

X. Slide to Turning

rates growth due of and colder to XXXX for the effect about Despite of $X.X favorable months million, XXXX, XX gas the gas compared was the winter in XXXX. to in customer million increase adjusted The colder gross $X.X margin gross system of adjusted year, higher normal. X% $XX.X reflects XX, warmer year million or X.X% end For margin $XXX.X peak December million, than increase the heating weather. an fiscal was

Moving an on X, Slide bridge to results to XXXX. provide comparing earnings XXXX we

partially by taxes, to higher higher higher on levels $X.X million, and million, I on both As distribution and XXXX result service, million, higher labor expense maintenance margin million, Operating and Other operations. and $X.X gas rates by higher retirement than income our service, as $X property utility local of and expense. by primarily $X.X decreased balances, short-term levels Depreciation higher costs. increased lower of expenses and borrowings. rates increased Taxes, and reflecting taxes combined lower slightly largely of utility interest million, electric taxes. plant a a due $X by benefit $X.X and to primarily customer increased by other lower and to payroll maintenance debt $XX reflecting $X.X higher of million, attributable gross adjusted million, offset noted, of on plant amortization and costs increased long-term expense and by due amortization growth utility in higher increased costs higher million. operating other Interest

$X.X taxes of a increased as result income Lastly, by pre-tax million higher earnings.

Hampshire Unitil New progressing Northern the are well. X. Slide rate and Energy to cases now Turning Both

projected We Slide reminder, all Unitil the have that Once reached present a the parties will commission pleased for XX rate multi-year in which I rate case agreement for filings hearings the investment be have revenue is full relief. scheduled temporary have we decoupling the will on as to agreement and past, settlement settlement currently updated approval. we On rates. the As to February a it principle subject filed, plans, done plan. XX, have final in commission's include at consideration. announce both proposals, time we our am five-year comprehensive in XX, and energy

safety existing $XXX distribution system, of will grid our XXXX, growth, Our our planned enable expect and reliability investments, infrastructure. which our system modernization now customer initiatives, million, in the utility to enhance total about million approximately In $XXX we invest experience. ensure advance and

energy Looking projects potential and remain distributed such modernization, as to natural supply grid and forward, upside gas our revisions investment there additional projects. side for renewable infrastructure, plan vehicle resources electric

of X.X%, mix financing provides anticipate increasingly continue our portfolio. We long gas becoming balanced to supporting electric investment the and operations. between run X.X% capital investment annual five-year the in our to XX growth plan with range rate-based Slide

funded thirds operations, to through less roughly of from equity. expect be be The debt cashflow by and two will remainder a dividends. investments funded combination of capital our We

maintaining credit metrics. demonstrated of third the our balance in quarter to offering equity follow-on commitment our investment-grade XXXX, strong a sheet Our supporting and

to financing and to enabling XX%, We target of range a external reduce reinvest ratio payout continue XX% to us earnings requirements. dividend

Turning basis. $X.XX Slide a of we the an XX, of per that to are declared Board Directors share, or quarterly company's annualized $X.XX pleased recently dividend on per share

ratio $X.XX ability per dividend years, by $X.XX increase the the effort on had the strategic our toward an financial This in of basis, share our the range. reflects our increased execute payout company and year's per several move share, to in target confidence For annualized an plans. on company's annualized to

further our that, payout moves dividend years accelerating over growth in evaluate will I will back it as with future to target Tom. We turn into range. our further ratio the And

Tom Meissner

Great. Thanks, Bob.

as Turning Slide seen for service growth natural to customers we dependency both fuel By as reduce natural we nation. areas money. this we the have save We've the to strong and States in mentioned opportunity, before, emissions development. conversions Further have for operate oil is serve I've gas, in years. that gas, economic now the unique seen can incredible potential increasing in the recent of customer And customer penetration home heating growth on highest XX. supporting the

capacity the and customer Moving with Portland diverse customers’ Gas south, on advance winter on our with to a to Tennessee have both needs, reliable capacity New north natural on now the capacity Maritimes days. capacity north, of we pipelines Transmission, as from arranged From & upstream. and Natural to well supplies gas Unitil with have pipeline have storage and peaking supplement south. and supply underground season storage adequate as base. Company. Pipeline, meet coldest of we we ensure the growing in Pipeline order supply meet We pipeline England our and procure the to interconnections XX, Gas From Slide interconnections Northeast demands we originating delivered the of the heating even in maintains our the further

say record be And than the customer can In as throughout normal period. service well we colder our for fact, due winter to a month weather. as for confidently January meet adequate demand will fails to growing we our likely base, gas have supplies areas customer

XX. Turning to Slide

industry strive years. Award to and our continue emergency our operationally, Response Emergency Both As in earlier, widely for time and surpass fourth were Institute's on gas reliability the awarded standards, the and a we Edison I we response, touched to excel continuously electric improve. Electric five

reflection order tireless us flexibility safety our a dedication accident major emergency This year, in Additionally, recognized Gas a reliability. center or provide storms the to Association command to and were mobile American fleet response added our also emergencies. we for outstanding of improve has response system to emergency our to during new prevention. awards and and These our

solid at hand to Ending all-time Moving the on ranked Customer second plan safety once and We year year better service. today top on with the our with us, XX, made in performing customer nation. now the has is in to to dedication with opportunities XX, ahead. as pleased our behind for stronger, goes utility strategic rate and Slide the company fiscal continue top our positioned satisfaction stands us attainable. progress were utilities customers on Northeast resilient, the ever and more in again believe is hand we a reliability before, and Slide are than high an and the the in focus we The among our XXXX long-term row. company the

to our continue for execute to our Our we us about create growth shareholders. prospects, plan maintain our excited We're and believe excellent will and its the to growth customers. allow and strategies, value pursue company's sustainable investment future on will our goals, long-term service sustainability

I'll back So, with it that, turn Todd. to

Todd Diggins

turn now the Great. That material questions. wraps on up will coordinate the Thanks, I'll who Thank call call. you over this the to attending. Tom. for operator

Operator

instructions]. you. Thank [Operator

first Julien line will come of America. the Bank question Our from of Dumoulin-Smith from

begin. may You

Kody Clark

Hey, actually Tom, this morning, Kody and Clark Julien. is for on Bob. Good

the budget projects could those what and Can could projects system on look there first you if and upside state that sense energy any might capital be, show color you give for that in around you outlined, the on some advanced and So, what have strategic on CapEx timing energy plan? solutions. size might these the like, projects up clean you be when

Tom Meissner

to Sure. all, on electrification relating very Well, transportation first focused in of particular. we’re opportunities

the at That supply to pursue business I expanding concrete area. to statute, business don't upside in regulatory continuing we ahead a would still also would and looking to plan. we've have also, for as us we’re trying portfolio yet, but advance reflected we not So, supply our both that that, the focus of the structure years our think out that mentioned under legislative we're we extent that's are that allow try have case recover R&G supply we’re the area. R&G capital to be but And in case allowed We're infrastructure. and we pursuing a EV area to that opportunity, potential for on and in an one prove a solar that as to

Kody Clark

and all you Okay. And just UES Got where differently, with a the principally to around the just the return? Understood. intact settlement come agreement? next on of able it asked programs settlement, an to I little were guess Was agreement. core And it. then curious are asks rate the

Bob Hevert

it's Kody, Bob. Hey,

think, settlement finalizing we’re middle in Kody, I agreement. the of now, first well, right the off,

fair to really so, the of until filed, the in terms we appreciate, specifics comprehensive, agreement and the as cannot you in sure it's of speak scope it's agreement. And it's that comprehensive can and is parties the have agreement it's to the but comprehensive I'm to say we

we really issues the of filing, included host particular speak to a but that. can't in that covers beyond it in So, were it

Kody Clark

on the X% lastly, fair. gas assuming can, New growth, X% That's for in growth within understood. just you and wondering Hampshire EPS gas Okay, And just that as conversion and for what I Maine, you're natural opportunity discussed, customer electric then rate. if to

Tom Meissner

sure is assumptions this I'm recommended. that Tom. Kody, we not specific have

value people undertaking and in reflecting because coming an Our X% - homes that, that the sort a assumptions that shortage activities of in inflation investment think significant a on of little we significant of because we're growth seeing the like a increase housing weren't more development five is in now, I also we we're based growth seeing are are in seeing years. to through, but area. we think, and projects uptick seeing, this bit terms largely the X% and the EPS rate, around I What conversions, of next we of rate-based pandemic slowdown during anticipate

So, from fuel ahead. natural and we're pretty I the two, opportunity growth think over gas seeing in the between organic oil, healthy to switching years

Kody Clark

the so much Thanks Okay. for time.

Operator

[Operator instructions].

question the from Our of Shelby from come Tucker RBC next line Markets. will Capital

You line may begin. Shelby, open. is your

Shelby Tucker

Sorry for everyone. Good that. morning,

follow us are a gas? have for lot a Just of renewable resources natural about of the your you resources Kody's the give parts some on farms. territories poultry sense of natural Could type question maybe renewing country gas, like of available within to

Bob Hevert

There waste Certainly, as locally that is one. can potential biomass Sure. Hevert. look the for There Food Hey, is it's to. well. feedstocks are dairy another. Shelby. Bob we is

we might both diverse actually resources, local in. look consider brought feedstock resources that range there well as we So, have as to - more you when initially be can do than a of

of So, look feedstock certainly of But those move all and as focused on really as them these see supply forward. on the we at diverse each we do for we're we intensity opportunities, of them, projects. focusing of carbon a

Shelby Tucker

much natural then over guess, make actually Maine, I your those maybe the home Bob. more more pipes you as the through reachable much Got gas market, reach to would remind how have it. of look And for can New we you Hampshire, addressable heating at Thanks, homes? Tom, of market me how and is, investment to

Tom Meissner

density really State due only that clearly, cities Shelby, the that State to We rural don't Sure. currently think tend of operate To State in especially of gas. is addressable small is the opportunities nature just the point areas although the natural State. a there portion I to of with in the have now, natural that Maine, smaller gas, highest in still for

Northern think our I somewhere overall still penetration at is around XX%.

just opportunity So, gas we existing already our on convert means to natural still existing system to have our over have plenty them. of customers who and available

Shelby Tucker

Got decent we've correctly, And if do is still mean, see gas that the Where than over electricity. CapEx but of I have should - I trend CapEx of is, we question last greater we then to a electric. to more your the chunk time? seen slice to see recall a going it. I going

Tom Meissner

pipe side. on completing is, actually the we're the replacement of seeing we're part Well, trend gas

we'll in complete a years couple XXXX. finished Hampshire Maine, in we ago. In of be New So,

Fitchburg essentially to replacement until XXXXs. sometime be thereafter pipe will & Gas So, the Electric in limited

So, is that's little bit. a spend come to why gas tending the down

we're in the some seeing about. opportunities opportunity advance grid, invest more On electrification, and the other to we of electric pursue talked the side, strategic

Shelby Tucker

Got it.

So, skewed program, similar gas off, CapEx money we to more should electricity. just type program of comes but as a see your

Tom Meissner

anticipate. Yes, we that's what

Shelby Tucker

much. very you Thank Great. it. Got

Operator

Q&A And segment instructions]. Thank today. participating, conference further [Operator end I'm as today. any our everybody. you not for That questions will showing as for our well

may Everyone, a have great You disconnect. day. now

Unitil (UTL) 1 Feb 222021 Q4 Earnings call transcript