The Southern Company (SO) 8 Aug 182018 Q2 Earnings call transcript

Company Profile

Participants

Scott Gammill	The Southern Co.
Thomas A. Fanning	The Southern Co.
Andrew W. Evans	The Southern Co.
Jonathan Philip Arnold	Deutsche Bank Securities, Inc.
Steven I. Fleishman	Wolfe Research LLC
Stephen Calder Byrd	Morgan Stanley & Co. LLC
Julien Dumoulin-Smith	Bank of America Merrill Lynch
Michael Weinstein	Credit Suisse Securities (NYSE:USA) LLC
Michael Lapides	Goldman Sachs & Co. LLC
Paul T. Ridzon	KeyBanc Capital Markets, Inc.
Ali Agha	SunTrust Robinson Humphrey, Inc.
Angie Storozynski	Macquarie Capital (USA), Inc.
Praful Mehta	Citigroup Global Markets, Inc.
Ashar Khan	Verition Fund Management LLC
Paul Patterson	Glenrock Associates LLC

Call transcript

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

Operator

Good morning. My name is Melody, and I will be your conference operator today. At this time, I would like to welcome everyone to The Southern Company Second Quarter 2018 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session.

conference recorded this X, Wednesday reminder, XXXX. a is today, being August As like conference turn would to I now the over Mr. to Investor Gammill, Relations Scott Director. sir. Please ahead, go

Scott Gammill

Thank Second Southern you, Welcome XXXX Earnings Call. Melody. Company's morning. Good Quarter to

this Officer Southern Officer. Executive me and Chief Drew of afternoon Chairman, Company; Fanning, Joining President Tom Chief Evans, and Financial are

materially in remind me addition will cause providing filings. forward-looking information. historical we results to the those factors actual forward-looking discussed could indicated and making quarter Form Let be that from to including statements, XX-K, differ subsequent Various the Form you in statements those important in today XX-Q second

call. The website Investor addition, In our morning's morning as turn the to will the measure viewed present GAAP are on information discuss call this included I'll slides in for we as this Relations well be information financial may this call. slides we point, during the over to call Fanning. released applicable this this on will at At Reconciliations investor.southerncompany.com. the conference financial non-GAAP Tom we

Thomas A. Fanning

and an thank on morning first, today. will I we'd and moments. complete X, to $X.X Vogtle reflected quarter business the X Georgia in joining reported to X. which the represents a our for usual like increase provide Good Drew cover cost as updates X But us Vogtle in you for and few and update billion second in our earnings a an charge of pre-tax Power projected share

had Southern project project the fixed develop schedule filed of in of owners reflect part any original time the documents, information, Southern including discussed completion X Westinghouse. self-perform continue estimate not firm new subcontract X cost being in Nuclear's and the November that for This cost basis the to Power XXXX, more and Westinghouse's Fluor and a a the was contractor. respectively the cost access and first of was We to XXXX November the with XXXX completion brought and construction no detailed between estimate contract and March schedule. as Nuclear for other invoices, for had Units benefit to role project of of planning longer EPC Westinghouse new date its does estimates and new bankruptcy Georgia After changes and

Southern its from ETC VCM became Westinghouse began on Nuclear building the and estimate assessed XX Nuclear consultants. complete what as by Fluor information and reviewed to Southern by obtained and independently or data based

hearings As to August filings Vogtle no-go in submit These for Georgia a regulatory Service are XXth go The an framework make Reports important of part post-Westinghouse Monitoring its Commission. X Vogtle for decision and to Semi-Annual and which Construction the Power used by filing reminder the bankruptcy the PSC Georgia VCM follow Public or VCMs the was X. project. for XXXX the

form of project, period estimate. time the cost VCM their on forecast, risks, work, short productivity any ETC was XX Commission Southern Service be of ETC cost the Nuclear escalation. Georgia project heavily an and regarding potential ETC. VCM of submitted to expected with Report the on labor VCM included As costs to discussions based cover assumptions also XX specifically scope XX including productivity of The costs force the the maintain within XXXX. to the and some be the be acknowledgement terms improvement that still unidentified ongoing at of Power time. to XX for could key work in that Georgia unable transition on escalation contingency may craft that allocable intended that a was reasonably the cost This scope August Public increases labor Recognizing relating may the the impact added contingency to was the of to

Power's the billion Power's with $X.X as ETC, approved complete, to to with Georgia XXXX PSC Georgia of a the general the of provided the which new reflected December ETC PSC. Report, Southern has addition able independent initial cost and momentum since of of estimates consistent cost Southern total partial schedule agreement structure exhaustive project the Georgia review following as in recommendation maintain completing Nuclear reasonable Power the were the the In the and the guarantee Southern cost construction. XX of VCM been continue billion an of project. PSC project share proposed with In in The approved net customer parent by guarantee. the to for that This initial completing Toshiba ETC, refunds $X.X Nuclear's Nuclear year

in XX-plus that transitioning others negotiated these changes some has project cases included to and not effort, forecast the Many duties market the labor contractor scope. capital momentum project same project conditions project cap, had attract and such it The engineering implement support efforts fees, this a that implementing efforts estimated Nuclear recognized needed that within yet craft resulting at Nuclear ETC. cost supervision that Although project of Bechtel's subcontracts connection the billion its initial PSC Among cost forecast undertook at $X.X to time sustaining continued of Southern these not subcontracts been firm maintain the the staffing. costs, new Southern to determined while changes of field lower and the was adequate also team other increasing reflect management. increased and manage and the revised the incentives as with retain to to time and In at the its risks and project schedule. changes in scope expanding up

capital managing million approximately cost to new the $X.X fully insufficient on contingency worth on increase As of this estimate, $XXX latest its part costs cost of and assess base total recognize a continually billion, from estimate to of the previous complete a of the cost cost estimate now This offset a process review Power's approximately recently we and years' Southern increased Georgia dollars. increase the was of the forecasted revised to includes reflects $XXX $X.X million. The $X.X based share an increases. construction estimate projected has new Nuclear experience billion of project, of project. Based increase contingency the billion and schedule and to

to continue monitor costs updates appropriate. X associated as of and Vogtle with will estimate X construction on and We our provide evaluate and

as believe the we the costs the after so with other and reasonable that of not projected we in complete have cost the momentum we contemplated with to PSC approval receiving continue Power long-term costs capital project project. increased to capital the million Therefore project seeking the investors, that increase judgment when Georgia it's request of soon by customer made PSC of customers Although necessary remain are and the part base best approval VCM interests XX VCM later the the $XXX stakeholders base XX disrupt not Power increase increased from increasing same and cost VCM recovery month, precluding customer estimate Georgia XX. in cost in the of the in Therefore impacts will files this rates. these

As cost Georgia our revised evaluate request Power contingency rate to the may approximately such total PSC the cost included when the is estimate, for to increase, in which Georgia recovery capital appropriate. and XX% of as

can unanticipated and this to to and take and recognize sufficient require a and on project continues. We in-service construction revised forecast we to continue we've X have further XXXX That been and completion events for may met and date project completion. date be scheduled the Meanwhile Several to XXXX major revision completion. November X respectively. we by achieved challenges contingency schedules progress construction new that will ETC that get continue said, Vogtle and project milestones X nuclear X project to are hopeful Unit experience to November to that and

a on construction these of contractor work dates. months primary Our Bechtel to based schedule plan continues ahead

We electricians will pipefitters attracting productivity monitor onboarding continue and continue and be evaluate rates to priorities. to and and retaining

work do. these having have we more are We to but with success initiatives

state-up Southern ask both the from provide few to phase. China the estimate. and APXXXX personnel learn are on have new of fuel financial Westinghouse four currently Nuclear and Additionally I which now will the a aspects for loaded project now Drew units details to in continue in

Andrew W. Evans

$XXX in Thanks, expenditures of project. future to for after-tax pre-tax reported the charge cash billion which is for Georgia charge Tom. translates Power, estimate $X.X increase the The an a million

However, in its XXXX. earlier contribute equity through this capital Order equity Georgia Southern approximately Tax structure Likewise, of to of equity year. credit sources in target the and maintain to in profile this we Georgia incremental expected million This to Reform of PSC's Power to that commitment used and $XXX incremental Southern credit Georgia Company, the will is to the down recognition consistent the remainder the types quality with past. common Power we've from of Company our plan both issue come

XXXX equate included to assume to being to X% estimated approximately and guidance. these in as are or project block project are and any the does While complete $X.XX market to project. to anticipate Even not increase XXXX EPS $X.XX sales. we and of our discrete growth with plan current future subject else we to do long-term the our shares change any X% other reach by spends rate our financing these additional complete to factors, EPS activities cost efforts, equal, not XXXX offerings or equity financing to All dilution approximately conditions the

additional optimize continue on plan, to initiatives. our to Tom call effects turn now update these of including funds. expect evaluating for to financial recent investor-friendly We the will a offset overall I brief and opportunities back sources

Thomas A. Fanning

$X.X Pivotal XX% Cumulatively Southern portfolio minority and completed May, Thanks we in we sale City of Drew. Elkton June. proceeds. Florida of and the Solar we sale Gas, accounted Solutions Home Elizabethtown Gas of more these transactions in In for sales a the than July, completed In closed in the interest Power stake billion Gas.

sales drive Southern plants approvals FERC the Oleander. the filings to Stanton closing timing for the We transactions. and are of these have and These appropriate on completed Gulf for regulatory Power Power expected

will transactions Our current close that first is the XXXX. expectation of during both half

the hope progress also of expect wind existing we equity making proceeds. great transaction this close which quarter for during produce XXXX. financing fourth than on billion in Southern to to are portfolio, $X majority vast the tax of We third-party Power's We more

new Company to discipline example, further growth The equity portfolio companies, our strengthening seller Southern both tremendous our expected have Gas source demonstrated capital of Likewise, assets. with than of Resources proven significantly be profile. complements proved terrific recent an shares. common for Southern long-term and be Natural effective divestitures cost transactions, buyer a lower to and as to AGL of of has have a our

seek approved improve centric utility Power to as specifics Mississippi this filing quarter a disciplined profile. note, final amount. further some on continue receiving Drew Public we the Service upon settlement will performance. now of a the growth earnings Mississippi state-regulated our And Company provide yesterday second will majority PEP approach our as for requested the Southern Commission

Andrew W. Evans

Tom. Thanks,

XXXX. loss we share the million of of with quarter a compares This For share. $X.XX in $XXX of a $X.XX XXXX, quarter the reported second $X.XX second of per loss or a or billion

XXXX, XX, the or $XXX million June ended share loss share $XXX per months of $X.XX we reported compared six with in same XXXX. a earnings for the the For of or million period $X.XX

other quarter associated respectively. These Major compare period in contributions impacts the share of $X.XX since the amortization, period and for Power's drivers fleet. as utilities outcomes increased effects XXXX well with and as and $X.XX same by basis earnings of offset six weather were increased and state-regulated from per our June costs. XX, depreciation described second earnings share charges Excluding include and material, on XXXX maintenance Kemper XXXX items results the and $X.XX the for These $X.XX month XXXX. earnings second regulatory operations and an constructive and were at year-over-year per partially Vogtle, our quarter results positive Southern for renewables with adjusted ended adjusted

end turn not I have we over to our I until to Florida remainder ahead provided updates adjusted In for needs guidance our $X.XX plans we're guidance and Tom, of we year-to-date, equity updating reducing the transactions, light XXXX. to impacts year report is provide the for EPS $X.XX. performance an our XXXX the of tracking our back to Before of year third asset basis the which results. full quarter want the our new on adjusted Historically, call outlook to EPS our of with

I'll Tom, third back Finally, you remarks. adjusted $X.XX. for over the estimate call for closing EPS turn the our now quarter is to

Thomas A. Fanning

addressed want again, being call. for we've Drew. thank topic I to today's I'm many on Once regarding sure you us all Thanks with this everyone have morning. questions the

question. So let's let's ahead the first for Operator floor the and open questions. take go

Operator

line comes Thank Jonathan Arnold you Deutsche Our the question Bank. from first with of

your proceed Your line Please with open. is question.

Thomas A. Fanning

Jonathan. Hey,

Jonathan Philip Arnold

Good up our morning, question. taking guys. for Thanks

how process was in Vogtle one along? event to in I Just you in of that co-owners around noticed disclosure confident come thing Can XX-Q in the just that have the about them and didn't one new vote happen around are need at needs to XX%. Tom the you you the of what talk to which us that a come would

Thomas A. Fanning

because There own be the governance to to our think communication to events I they and to have offer, disclosure. that for co-owners governance in kind want I that relationship. to co-owners for our I of is only trigger with to not can the and I let speak supportive characterization Sure. process refer say here. we've these a constructive careful the that very process we is Yeah. certainly their in speak had been our themselves, have in real-time past Jonathan,

that, to Beyond I let would itself. process speak really prefer own their for

Jonathan Philip Arnold

when that out? think you play What's the will timing on

Thomas A. Fanning

I be it'll the of Certainly quarter, at the into late fourth end expect September. third Yeah. perhaps the but very quarter would something

Jonathan Philip Arnold

it what them, to your – wasn't to would your know, as you you of if move them how plans sort forward? of one but Okay. for want realize I affect – And don't speak to would then

Thomas A. Fanning

fact, Well, a Board that. to with Board, Power recommendation structure, made Georgia voted, based the on we the in Southern the concur current

was forward. that any as the result up We of at are moving time. Anything alternative an a governance that to have take we of just processes, these

Jonathan Philip Arnold

work then the looking on you seems been there's of more – where the And higher maybe, of talk two. a What metrics. you happened just move some know site performance July? Could one show about you the in at reports with I sort to where the shutdown slide that kind I top the one it day Okay. for could, sharply that? if or at

Thomas A. Fanning

green at it. in going kind calls variance where look it. we XX earnings or kind and fact, which in if XXXX month been a while that beating the general Yeah. is now look a Look, had was XXXX when you predicated of much planned we've really time completion to periods pretty was back otherwise well, because think, schedule Remember line the really dislocation holidays. April on of we've lot That's for trend, worked we XXXX, April of were December if I this suggested, and couple That that, through at you from of date. in a have we a work some go very

we've certainly of confined we that month as when that core So reactor part would And saying, we there. approach made lot up that's erosion vessel against working of then some year, spaces rather started we schedule. thought see we we a this kind the in why XX start early with some that

the our think is important earlier The spring the got But end but a had this to other of careful, think stand-down spike deploy a site. be be, attributed average, little rainfall thing I we that ton spike would to of – I may four lot at a the ability that week rolling you and a the two-day-or-so be on that is to productively. impacted this

Jonathan Philip Arnold

And there? what story was the

Thomas A. Fanning

Sure.

as produces recalibrate personnel, with percentages time on just as medicine to I results. that tough efficiently think good. happens. from and that need, we that focus think generally whether been but make meet action recalibrating we on oversight task the personnel of site, to to pretty have leadership's following the took we it year-end is complete The personnel take was long is And results that site it expectations run sure time completion to to painful, I is good just it all the whether commitment of is their is it

Jonathan Philip Arnold

that the XX% between just the plans. electrician what the prior XX% of in calibrate one Could finally, to XX% was disclosure and where was then by mean does staffing that that think in just other the And and target? XXX I Okay. that needed context I and VCM, the of hire you you've of October? to you to of like this think what pipefitter given disclosure is XXX XX%

Thomas A. Fanning

we where of kind versus to ramp That's up. need are We continue to now the plan.

we show November. I think our peak staffing would in our projection reach

think feel where are I we on about we pipefitters. good really the

the one the that think I electricians continues focus. to require is

on to goes Look, address perhaps it getting to personnel need. on people arrows different hit think it confident, It workers the in need But site, on either Rico these remain Brendan face this. we work We talk lot to getting believe a re-segmenting it in-person, from We we goes and areas. on we to text, are from now. is still targets. the to hit goes everything of biggest other but phone, focused to the I Bechtel, have site quiver absolutely We realize e-mail, the People can I risk we area that. that Puerto Canada. right

Jonathan Philip Arnold

Do of you number more to hire? a how you many have need

Thomas A. Fanning

Yeah, there schedule. is a

don't my for we think you. I right at it have get I just fingertips. it can

Andrew W. Evans

current to best think of two-thirds is is... are expectation populations the think way the about it about what I at

Thomas A. Fanning

November. By

Andrew W. Evans

November. By

Thomas A. Fanning

you about We It XXX get jobs... represents more detail on can that.

Jonathan Philip Arnold

But to plan, XX% XX% that is two-thirds of that... November, of but

Thomas A. Fanning

That's...

Jonathan Philip Arnold

Those are comments? not conflicting

Thomas A. Fanning

add Yes. Plan XXX we and is now more by need like to November. are then we where about

Andrew W. Evans

Right.

Jonathan Philip Arnold

And is the in relative last that the categories the XXX? to both relative disclosed XXX VCM of to XXXX or that was

Thomas A. Fanning

Yeah. the we And It's relevant where were electricians. it to before. is yes just

Jonathan Philip Arnold

great. Okay,

thank Sorry though you. the to, all – for questions

Thomas A. Fanning

No, no, Jonathan. Thank great. you,

Operator

of Fleishman question the next Our comes Steve Wolfe Research. from line with

Your proceed. line Please open. is

Thomas A. Fanning

Hi, Steve.

Steven I. Fleishman

good Hey, morning.

I confidence again that, not has schedule. commission pretty that there's important these to full been integrated because seems the or in Could numbers? that's saying think you talk like staff it having a project

Thomas A. Fanning

good I have schedule. would that argue we a

refining schedule, continue is that's all on that but something to the work ongoing the time. We

XXXX. month, XX, that of on expected I have one something have a three of XX left. but been critical Again, can I are the two XX detail, for float and have year, XX those the little none – by, In construction X, both one during are met within and fact, out I month off resource go here They're met things have neither in would a of another argue or look a of are May. rest tens like just to over On thousands weeks. We XX variances one the path. X, into They on morning big lines path. Unit even. Unit item not. of week, detail to case the And two happen a The be completed of case, I'm of plenty plenty I just the parameters, reviewing of was weeks loaded there's the only of is looking like schedule at this milestones and critical

and look as we schedule I at is ongoing something different always expected And so than that's this completion an we integrated process or this new we – have dates planned, an the it. always performance do But the we we we are see actual now is schedule. always and review refining see, meeting that that we would right argue, schedule as

Steven I. Fleishman

I are XXXX to schedule are like your just the earlier us XXXX, months internal And November those Could know Okay. you tell November same, what dates or...? dates, still an it is timeline. your seven the schedule is ahead relative had just

Thomas A. Fanning

thought we've what the before. month, data managing the And taken we we that into Unit of what we tight achievements would Unit XX those means said beating metrics constrained Yeah, been be because of and precisely a X show we've early I and a followed since We've at April a people XXXX would part nuclear we're of the these that we've very XXXX XX that that guess we is the to. that end the we've roughly. But and site over, with said of the not X. in even the challenged, material thought of And site, XX has April was yeah, and that reactor That's fact progress earnings April to would site we really schedule, suggested. be for schedule, what that XXXX the managing moving it's were yeah, month challenged much show what's for a month. lot lot we're the is in environment just called a of that the on calls, vessel closer data in had what

Andrew W. Evans

April Performance Index the we that show time that Direct say Index And schedule. Direct Cost and Performance you based that Steve I'd is the on Schedule

Steven I. Fleishman

leaders to And ahead informed then this absorbing most – I'm But any could news? sure Obviously you just... reaction you commissioners are of Okay. and this, lastly, it. from just shareholders of them political just could the just you

Thomas A. Fanning

as we Yes. supportive broad of public the I political the Georgia. that have. Yes commission would here remains project does argue in the

base impact it XX today decision you because the include impacts standpoint, capital If VCM was as economic existed approved. customer in customer remain today, customer we're cost tough a about same think from when not this the making standpoint, project to these

Steven I. Fleishman

ask Okay. I'll let questions. others Thanks.

Thomas A. Fanning

Yeah.

Operator

Stephen of Our next Stanley. Morgan question comes from Byrd the line with

Your proceed. is line Please open.

Thomas A. Fanning

Hey, Stephen.

Stephen Calder Byrd

you Thank my morning. taking good Hi, for questions.

to changes customers that want for moment thinking the how in present the value could to are remind potential set just the talk mentioned wanted absorb some me, that. are at project? Can about net level you time. we we customers value I the of to present commission be in calculated of contingency, just Just future terms to the at to of the I'm there over where you this the net sort incremental moment. about where

Thomas A. Fanning

Yeah.

was value the remember. the there That's remember that's degrees recall... what customers freedom the you. me about pursuing the around should XX, to call, or to I we'll of And back that's are billion if what benefit. that, like VCM get something not check but I course action. calculations this correct back of there by If value I present But Somebody after of as remember $X in

Stephen Calder Byrd

Okay.

Thomas A. Fanning

are action ...that those taken we've preserved. economics today – the with that's

Stephen Calder Byrd

Company through? I more forward, Understood. to rusty the Southern have mechanical to a that mechanically sort way of own joint is move the And move not work owners. joint chose a question mechanically, handled forward its around and would just like how how If then that chose of a owners little

Thomas A. Fanning

Yeah.

course, that cancelled. could a of beyond figure deemed you There don't answer project cancelled So proceed or answer believe. that. But paths beyond the out to you whether Then And that. would have you se take the is to vote beyond if action. the per how of is, XX% is no get is the technical prescription different be the variety technical there that project I be to then

Commission but would could things. approval whatever also Service other course, Public require that a variety we and Of negotiate of all

Stephen Calder Byrd

Understood.

likely reviewing technically at the scenario if that would Commission in plan involvement So point in terms Tom, that the that cancelled? involve of project is

Thomas A. Fanning

of Of course. it course. would, Yes

Stephen Calder Byrd

Okay. That's all That's have. all. I

Thomas A. Fanning

Thank you.

Stephen Calder Byrd

you. Thank

Operator

Our next question Julien Merrill Bank with from line America comes Lynch. Dumoulin-Smith the of of

proceed. line Please Your is open.

Thomas A. Fanning

Hello, Julien.

Julien Dumoulin-Smith

Thanks the morning. good for time. Hey,

on about write-off, sheet how you're just and following-up I latest corporate thinking you just of at authorized the So know talked balance in the ratios Georgia terms Power's level equity equity about this financing you're point. Can thinking level just specify think about and how rate about at next having you that at an year's on case, you if that impact how perhaps just all?

Thomas A. Fanning

You bet.

solution the order increase recall agreement was rate that debt XX% to reached reach in asset following Georgia Public like place may they legislation. we as tax to from and it effective later a would about X. Service constructive calculation ratio immediately that You Power was XX%. the new case. an They so was Vogtle which the with support quality, about The Commission think put the credit equity FFO building XXXX address It a similar X designed and is that and to important in again also in to to said essentially, their

was order. we we've So Georgia we equity thought also new equity down increased of that and review billion associated to the the across think And the it's are was we've bidding, tax the that that additional to $X be because that with When system got about law, $XXX it million incremental going informative. today ratios. in I also the you just equity consistent laid plan. into relate that streaming requirement front And of been to plans with per equity

NextEra, the for current took billion carrying assets in billion sold table, our we we With and words billion. were other about in transaction about off with $X $X.X that about were the valuation that we them announced essentially $X.X worth

any Further, tax $X against billion. requirement. the sale announced the netted equity to billion wind we production equity of $X with tax another that's forward associated the So future credits

the the the $X the morning think this taking and the dilutive $X We billion. the are net as $X handle million, think the reduced got sales, from becomes We plans $X by this From our issue. think with the so we actions we $XXX billion. earlier equity. and we EPS effect range as and that When it or in to well that $X.XX-$X.XX. $X increased reduced investor-friendly $X.XX-$X.XX still block this we've billion then the handle and this therefore now equity we've an year of about we billion, standpoint, plenty is now that to billion gunpowder was billion what believe in EPS reduce, effect that normal additional So any is market And opening $X.X of undertake our the believe can we said comments don't requires sales at by and action what within plans about to $X.XX today only in will said this year, And that kind this $X.XX is $X.XX we $X.XX is we $X.XX, thereafter. the and also effect. a eliminate XXXX of but to we

Andrew W. Evans

mechanically debt write-down is inject the probable, regulatory we at the little because take over This expectation we future expectation FFO this $XXX a And to – a are term, will today. we out for constructed costs. however there expenses it look that that longer-term. the construction will the bit certainly capitalization be to over part reduces but our improve paid maintain equity, Power million the fund this will we of Georgia time, the to in for want you used flavor is purposes, – But it this is because to near give Julien just of of will will

Thomas A. Fanning

dealing not to to we're today balance estimate are but expenditures And complete. new what se, rather saying made immediately taking we future the what Those expenditures. just improve with But have done is sheet. to actual per a that Drew underline action is the

Andrew W. Evans

Yeah.

Thomas A. Fanning

cash there's quality a advantage. difference, credit from to it our standpoint, a So works actually

Julien Dumoulin-Smith

about to earnings just this clarify about right, Let effect. of of just asset in me that to balance tracker and itself, earnings, doesn't you the for exceptionally change pertains any the talk over simply change be any sheet time, that this of question dilution this. none cut The basically clear $X.XX ability is this the a

Thomas A. Fanning

in that exactly incremental the relates to preserve That's to only we're It equity using quality. order right. credit

Julien Dumoulin-Smith

it's your we're to next to hiring more I to When earlier tandem, your to that schedule. suppose through if response tight bit, you "through construction ramp when a be that" hand-in-hand anticipate clarify describe particularly more with seem will, And little definition? on the to sort it importantly Steve's here. also of that right, the elaborate over you difficult the bit suppose stretch period seemed little on both be a the do well as construction. right? I in And per going Can to to of question go you you

Thomas A. Fanning

Yeah.

the are intensive we XX good like staffing seeing I terms XX where down months pretty After cetera Julien think the see next pressure. something on site, the about big of in that. ramp so we're et months a

Julien Dumoulin-Smith

I'll let very you there. it Thank Okay. much.

Thomas A. Fanning

Yes, sir.

Operator

Our with the of Suisse. from Weinstein next comes question Credit Michael line

Your open. Hi, Credit (USA) proceed. Securities LLC Please - Michael Suisse line guys. is Weinstein

Thomas A. Fanning

Michael Weinstein Suisse Michael. LLC (USA) - Hey, Securities Hey. Credit

from on thinking follow-up to based that the offsetting and is it such in like impact? dilution Is that mostly see $X.XX in growth or rate grand the do the Just the dilutive going the as and come Georgia, growth you (XX:XX) cutting future. cost offsetting out mechanism to – additional with project is what part offsetting

Thomas A. Fanning

as equity, discussed know that potentially we've investor-friendly it's before. You all and

Drew, heck I AGL the you billion. at Just sold pick Elizabethtown $X.X past around value there for a acquisition in there example, your for looking million, was made and of I'm think it carrying an it $XXX

on So Elizabethtown. up $X about you billion picked solely

$X there. economics the picked Florida we billion I the transaction, described As of up

data even XXXX, really have think cost this postponed their able showed order are it should of ahead this has guidance update which ahead in example a with company-by-company profile And cost by own about remember Power, that original $X.XX talk that encouraging after are already maintain done give evidence been fact basically top the Power's position yearend of recognition an performance an numbers which been process you I our XXXX. at only our that's That range, October good. our Normally, early ahead has for original a the been we call. been year that all accounting days an from important far in effort. $X.XX-$X.XX when really whole quartile in process the that management, into we to our give as whole And the Georgia hope, months. in has to guidance that and through we far go on to been improving its call, earnings our we of cost we because not end the as treat we precedent, so the summer Part guidance my and get been February. really industry. us metrics that ought we change I'm modernization new $X.XX-$X.XX. normal three at guidance, note, other I is to other we calls, see earnings our our ahead, about the should January, thing to that's to to of about Georgia performance process going you Power, felt so CFO. our We think The back our just but were And lot thing cost Georgia has decided pushed as action

think it's all So I I Michael the think above. that,

management. I its cost think

piece next type I you a of item modernization think LLC the there a give is What's question, squeeze. XX pressure do that of middle increased of kind equity. labor of (USA) be course next this or resilience, over forward, you're deployment going to big to particular the the the cost particularly - right Securities Great. that'd monitoring customer of Michael and that's happening over CapEx Julien's months it now what months? in coming most XX then a costly? guess next is going equipment I a follow-up integration service, expensive up be we're the And us Weinstein see on of as Credit investor-friendly better Suisse greater

Thomas A. Fanning

of the cost then hours get the amount onsite Suisse XX next (USA) month months. LLC Right. certainly has worked help with every isn't for because our have ability in productivity ramifications. of all equipment we know actually through time That's major keep going we've much that November into that, improve Weinstein get to onsite. process the on saying for to now. deals got and place. really our us ramp-up Securities and And productively the It site and - You labor what is this as Michael we so deploy We've to it schedule that been some Credit to up,

installing there's So were item was critical no modules? still as when we path there

Thomas A. Fanning

there will work the go no, to really critical always no, is is in I which No, in that definition path. sets required timeframe you is be mean critical path whatever by ready service.

for year XX The the I completion For milestones Fleishman. within example, to rest Auxiliary now was successful when testing critical this Auxiliary schedule. allows components, the critical kind will X and and timeframe of construction I major Building major which to mentioned begin just I the because the other of and Unit remember for right of us Unit X set the talking Building outline a path of gave time the on path that broad

putting Right. a Everything this We Securities Suisse material it component. onsite. Weinstein Credit LLC Michael at no is together of have really point. It's matter - (USA) major

when be Sorry, your through completed you going part it if Auxiliary of mean, before. and said that? is to Building this I

Thomas A. Fanning

year. I'm see, through well, looking end Let's this the of

November schedule December XXXX for essentially and the for April play have Building of that actually we're in Auxiliary we're And and beating schedule. be the the now the control right we kind on based by XXXX right We of to that's ahead room – now. call in

Credit each are a not week about a LLC beating et on the Weinstein All by very much. lot, Okay. thank of whole right, it - Securities floors by cetera. Michael Suisse Great. concrete (USA) We you

Thomas A. Fanning

bet. You

Operator

Goldman question line Michael with of comes the next Our from Sachs. Lapides

Please line open. proceed. Your is

Thomas A. Fanning

Hey, Michael.

Michael Lapides

there role down sure question. my seen taking especially about data conditions Federal I'm with for you or Thank labor your privy given the Tom. and broader Hey, the you're have market. Reserve

region at the of and industrial Vogtle are what differences X curious, compare labor seeing? large either would other construction X manufacturing seeing that you Just versus kind projects or how you're in the

Thomas A. Fanning

Yeah right.

It's labor of what most is fascinating is we're part. I think question. intense seeing skilled a the kind

kind a seeing around of are We spotty United labor States. constraints the

people. something the since big So of conditions the because draw is change one sites, electricians, there's going the on specifically States. to that manual people activity original the have more those skill in And IT, to around it's other special place once cut that in onsite appear turnover our high has to diems ETC labor, United seen working. requiring electricians pipefitters, today. gotten we to have attracting reflecting we've in been The that them And do We was half. per we place put interestingly, put be be appear we're that

over we around there. But been anyway diems. XX%, So able there. X%, now and of better these Turnover we're turnover so XX% – somewhere somewhere kind have attract seeing in X% retain X% per with to around or

Michael Lapides

going the and helpful. given in state... one follow-up but That's And neighboring it. on almost have this, Got to super ask to, what's hate Tom,

Thomas A. Fanning

Ask away.

Michael Lapides

over. original from recovery for process construction? states in What XXXX, the is ...two is project cost nuclear law during if the the XXXX potential abandoned

Thomas A. Fanning

Yeah.

prove prudent. the deemed ruled presumed that or basically cost about be – says in be or up reasonable, so still incurred that And have deemed at been billion costs up on is prudently billion We three recall $X.X numbers place And up least found $X.X have been over to to billion burden is prudent, hope these – been billion segments or be they I to right, up us time there been are any about have to Up wait, so already are to been prudent. recoverable. have have $X.X to law the have about up to of prudence. to I to so but $X about $X.X billion, on get to then

any I recoverable. that buckets. where those I the on think we think determine And numbers correct it prudent three would buckets is are somebody but those of And the those separate if broadly are. I've that's me, missed

Michael Lapides

would Got like? kind to process the is and was out look it what out and the regulatory PSC process in a there just through go it. owners to the would is of laid kind the And that legislation legislation enabling set of or figure have or docket

Thomas A. Fanning

the determination apply law. it against and then will PSC make The will prudence

Michael Lapides

Thank it. it. Tom. Much appreciate you, Got

Thomas A. Fanning

sir. Thank you. Yes

Operator

comes line Our the next from Please of KeyBanc. Paul Ridzon with question proceed.

is open. line Your

Thomas A. Fanning

Paul. Hello,

Paul T. Ridzon

needed Good the majority? Have you that any triggered co-owner a events Tom. morning, past vote in XX% the

Thomas A. Fanning

guess $X that think And is relates And fact... new $X triggers more. Yeah. lack ETC billion, a of recoverability. the other One one in a to there's I or in I of excess we two think about. billion

Paul T. Ridzon

early... Tom,

Thomas A. Fanning

to one we an was agreement this decided And was two-trigger other the Paul time modified issue, forward. feature at year go last that

Paul T. Ridzon

you $X.X billion, think you I not what seek earlier And contingency? million about million said of that the $XXX would the $XXX

Thomas A. Fanning

Yes.

So seeking been likes respect the everything but to think we incurred forward determination. and contingency has it's because With VCM for prudently they the were going momentum, $XXX reasonable, of part recovery. something essentially the to practice and to in and of sense of we'll don't broad the include its million, $XXX just think million to allowed the XX, those. never not this proximity we the What okay, staff of maintain know that Commission of order in the we yet, we're the We good that is think we by – in followed costs. part what it do of a spend, but nature don't frankly is contingency we because

million But for now is but spend As don't these estimate, we it. an right them known know costs we would will submit we become the recovery. where then $XXX

right XX. XX been That's by in the cap. preserve There and know As proven to cost more, we VCM the before no we ask Commission is for recovery. law

Paul T. Ridzon

big what through guidance, you the your And on then thinking last call? kind lastly, right drivers your of were the blew to relative

Thomas A. Fanning

with kind and issue One success service. had two issue success was Yeah, the and to sale the was to the of our the equity management modernization the it cost And and is of having really CapEx of was NextEra improve dual we of That increasing this lack Drew? second efforts. assets to new of of kind things. year. resilience the customer

Andrew W. Evans

had the jurisdictions. regulatory the tax of Yeah. one items the state I'd each reform success we've largest with implications in say, of is

the both in that Georgia to power in Alabama. productive so gas seen and also the positive And we've particular and LDC very relates from and outcomes

Paul T. Ridzon

first added be? the would that I $X.XX of know this year full quarter. $X.XX impact think quarter that do and the in What you

Andrew W. Evans

quarter be run – the equity future Power the content the of will a decent Alabama you've in that Pretty quarters. the driver Alabama in next rate, The the so increase as utility have third through in to matures. couple of track seen the and in we'll just lot stuff as in biggest

Paul T. Ridzon

much. very Okay. you Thank

Thomas A. Fanning

You bet. Thank you.

Operator

Agha of comes SunTrust. question the Ali with next from Our line

is Please proceed. Your line open.

Thomas A. Fanning

Ali. Hello,

Ali Agha

morning. Good you. Thank

should $X remind equity about and your had $X.X we needs are just Can come about year, know assume that $XXX sort years $X how said, they over be this how should previously obviously us think how equity you we down extra distributed years? should this the five now as $XXX comes Tom layered with thinking that? the we over million question, that billion, evenly of the base gets million. First but billion billion to You the you or

Andrew W. Evans

fair of also a with use think to to that changed, I shortly. equity even it. But we're of and And is has our though the that doing. out of is that's way sort then Ali, the We'll reinvestment programs our that an spend some intact. commensurate timeframe probably begin traditional about really intent dividend projection program think our move at-the-market will XX-month

Thomas A. Fanning

Yeah, it's in a reasonable ratably. modeling assumption, put that to just

Ali Agha

see. I

if have of much how the year? you And done any half this Okay. through first

Andrew W. Evans

of couple than a million. hundred Less

Ali Agha

extra $X.XX dilution Okay. rate talked And that if model you pointed comment also there then you've clarify that equity, – X% about you keeping comes it from as and the the is the intact. the out, to to had you this out, growth X% in

$X.XX or you're within X% want you I to that that to it dilution, the there. still is range? X% you're what implication with were $X.XX clear to even is going be that conveying the offset So the

Thomas A. Fanning

the $X.XX yeah. to to of the long-term, impact within it's timeframe we we are Yeah, take XXXX-XXXX still of point a clarification. the in No, X%. this good the If did is nothing X% away

intend special diminish impact that our through actions, to modernization, time through we investor-friendly over And whatever. Okay. or equity

reduced without to going eliminate, X%. great we're even So, X% vigor. within attack that we're with $X.XX still to any the effort point to My is the

Ali Agha

opportunity level? And portfolio? is the then getting can billion Southern gas of on to equity, portfolio, to you're you that I Power your you're electric, Is more us it. the more if there Tom, at wind, a look done they monetizing know the give $X the opportunities where that, Understood. just there in at the Got regards be at from are are you level? investor-friendly sense with

Thomas A. Fanning

Yeah.

I hand. think we've our kind of shown

an buyers where at as think very to I in of argument assets have some we NextEra, I a Ali our has been and have, valuation. set sellers. the got it anyway interest Elizabethtown been in NextEra and are lot we've If pursuing look current We disciplined you our you that then our assets special assets. Recently, portfolio, undervalued of had think think

you our think assets do, than valuation would for higher some if think Southern on otherwise be monetize you you of to from been core. the that, an the to is I portfolio. pieces capability think We see still of our different values projected different own. assets a have kind our to Everything we has been we're done as have have proactive if valuations at we gas standpoint I What issued of do Company. equity all when you That on investor-friendly to accretive. look expect we has the able Elizabethtown at and would

Andrew W. Evans

is and – And things are that but all of it There And reality that Ali, be to, answer is have built the is a certainly some the we're around quite that core enjoy asked bit. a responsive we operating. portfolio it's we've core. we to non-core? What's we what's simple assets think the margin edges this question at really that

Ali Agha

if is Last more you it. question Got will. mechanical,

we effective had. what Your to coming seems an be rate adjusted in tax on lower than basis

effective right the the is earnings tax rate adjusted we trajectory? what using be purposes should modeling For for

Andrew W. Evans

Generally right around XX%.

Ali Agha

XX%. Thank you. Got it.

Thomas A. Fanning

Thank you.

Operator

Thank you.

Our Group. of your Angie with next question Macquarie comes from the Storozynski question. line Please with proceed

open. is line Your

Thomas A. Fanning

Storozynski Angie Macquarie (USA), Thank - are you? Okay. Inc. Hello, Capital Angie, you. How

steel cetera, estimate has to do with increase the et in One do but So, labor-related and looks actually with to is, et two like things. prices so cetera. it the nothing supervisions issues cost

that financing sense. I'm asset that mean, with this But divestitures, increasing for might exposure to if very by can of arise. potential that's shrinking equity some the I And a project the next prices essence, good your on just I understand of secondly, company So are assets. the get your you incremental wondering you in a issue in

but And prepared if so these I be share equity, thoughts mean, you could might two just I know your still actually topics. on straight to that issuing up it

Andrew W. Evans

great Angie, Yeah. a that's question.

of point back to I did way about come that to X% assets, one our with me When Florida sold first In another we the you goes your let will hit – just first think. we think and of, that your what to I fact exposure, cap. accretive one things, think earnings increasing our was XX% exposure of that earnings are you but at It we time dilution decreases exposure do well of you And X% we to an earnings your standpoint. our market accretive. when actually about about it from the think accretion sold when enormously about

anyway, our asset. ever earnings when it So same you knowledge at a valuation XX gas times the on I results thing, paid distribution was look Elizabethtown highest think the cash to

sales Vogtle of way accretive what point divestitures above overcoming therefore these These would market because the any well I are and suggesting. accretive you at of think are the sales X. do at current any investor-friendly view to you're exactly market, sort it's to not and sales are have they – been, X the So exposure increased the our and exposure valuation they any should

math the bear that clearly. will out think I pretty

to On the first referred play. part you of your steel question,

Let estimate. it goes do commodities, clear small me We but to in to have have exposure almost that things. in very for with do our the be We onsite, everybody. calls think commodities big have the that. the that go purchased. major – the really It we've don't we And I of is this goes pipe, steel wire already I said equipment guess And to several the we're this and small accounting most we to cable. is think

labor that of and to. that really schedule month we onsite issue the worked maintaining deployment per think and so productive everything to we hit more else adhere I hours can the go does

far so now. performing that of right are at we're – And ahead and schedule on estimate months remains our confident we XX of

say. a Even subcontracts significantly we above ETC was started be subcontracts, So out cost I the Storozynski the seeing tend Capital - when in part big out what turned (USA), letting in they well. from Macquarie original related guess which that's those the labor we here May, what as be we to started and Angie I'd what of estimated Inc. late to

And... Okay.

Thomas A. Fanning

Macquarie Storozynski – Capital (USA), yeah. - I Inc. Angie Did Thank you.

follow-up. one just So

with So you up how come do contingencies? those

Thomas A. Fanning

or if we it be a seems I not. contingency like Sure. Macquarie get Capital conservative appeased now, also very is by this say Storozynski actually to one? contingencies mean, Angie included And million tough it's your - large was can for I mean, and mean estimate previous (USA), us actually perceived how yeah, Inc. $XXX to just I and

Thomas A. Fanning

completely a ETC a We consultant ETC process. And give regulatory debated; process it consultants. be. monitor estimate we and input Even followed thought the of in the different separate sound. the monitor went you independent how covered was enough? of kind we got but all think the original Again lots we terrific that we work you the question, remember did of of When I in script, estimate. estimate, it's a the from was time, input may I into more what even that different would their independent path ourselves then, And the with know of of us the we and thoroughly that this through you ask we took did one, variety some a had had own do had the reasonable we specifically the all of

reasonable how mentioned a started contingency I that made that did our others. we the trends we now we we think from have we seeing, than effort a XXX% Bechtel ETC. contingency. KPMG time Westinghouse at some At this added and when as another Westinghouse, we up So first with of cases something estimate. We've developed items we and risk but we Passover we getting should we range think what although And be, probabilities what and we terms they let's had We weighted items, before, of was showed feedback take that register. site gosh as know analysis new we We been So in in look that the the subcontract, I the original faster a (USA), line is involve our we got hindsight, on, we a Well will do developed we the look estimate getting when estimate. we qualitative complete where bigger look come a can contingency risk we to an cost. don't and the from And we a started We To when we than of actually especially we as contingency Capital tell we billion Angie on quantitative just the transparency subcontract testing. and a probability we has it thought, over high a in the of and XX% in late our we scope perform essentially project. consumed This we the at do the May got cost, We include you take believe sound for the have said, this we've add register, as in testing. new at reasonable? do we overall increase expected. assessment the management $X.X of worked XX%. best got not Macquarie estimate, call kind think judgment with estimate Does - per to ability, all Inc. the here. of kind in Storozynski low

last so Okay. okay, $XXX eating the question, shareholders are And the million.

has actual report. as that we up cost I of project up the no given been file absorbed another those increase true have that by assurance shareholders. the filed are reports there's what cap, to cost just and said I the you another about you're that VCM mean cost there is kind step VCM and thought to Now of and actually portion that of next is

Thomas A. Fanning

Yes.

So the a pre-tax a basis. the taking amount on of reserve we're entire $X.X billion today for

Okay.

million for and that how, because reserve. we will we It ask costs. is can't it address the capital Therefore, a exactly But what knowledge, know the we We incur base that is what of we're may $XXX tacit seeking recovery that include increase. when, the occur. we million not it contingency have because the is in that's So of believe does reasonable yet. don't balance, not a we acknowledgement those recovery estimate don't $XXX

amount. for taken an whole we've income So affect the

VCM we've whether already through it. there to costs to each of that recover taken some for will start eat hit as those go we we accounting analysis we get and not. or As into the But be contingency

Inc. Okay. - Angie Capital Macquarie Yes. Storozynski (USA),

you. Thank Okay.

Thomas A. Fanning

identified proximity let Macquarie that to decision thing December by it are to say just the was Storozynski And to Capital momentum judgment me million due one project we recovery the the PSC. again we've (USA), its XXXX maintaining our and $XXX really last - that seeking add Inc. Angie not on

Thanks. Okay.

Thomas A. Fanning

you, Thank Angie.

Operator

next the with from question comes Citigroup. Our Praful Mehta line

proceed. Please open. is line Your

Thomas A. Fanning

joining for Thanks us.

Praful Mehta

Thank not sitting and I you. the know easy. marathon thanks through Hi, session. guys for it's

stepping And It a we construction of expectation a to back before. I it it, such back what right. was The it's consultants more that most were regular this have of increase. and now is we're just these bit seems coming project. clearly with you through right, comfortable and done of kind but Vogtle kind do done in Just there dealt point cost of the with. dealing before, little managed and at do big you've is the how like a your haven't the almost some team we fought projects know of dealing risks unknown these point hasn't and How at obviously at you've stage, a with get the that kind projects contingency level everybody's of your unknown

every on manage with new and just that that's it's how some don't do unknown come was you up? just how risk so other cost have it that call do we get something you comfortable – And that concern incremental we that earnings

Thomas A. Fanning

Praful, we think in now of used at a they estimates ETC that range comfort I that for Yeah. developing want Look are of Well, in no are to estimates lot for comfort where know we year. for subcontract somewhere of in we XX% back. that. should bandwidths the reasonably of Very and There still so, the other in words, the we thanks a longer take role this question. they'll come take or been think And are In have that about reasonable in is that. actual yeah, should they all in onsite we've we've now known. and subcontracts, them words we we known, other least XX% out say XX% that. on gone pretty well where I about the

of how Bechtel does material maintaining work Now we is because we depends of and terms follow to on so time still lot important. got so the be the that have in work a productive schedule and work we've that and situations subcontract

to think as the the take challenged continue one is say, pretty other well I working that thing part can has comfort this we're in you that in we some of although schedule been still part schedule. of

than performance the still that part actual But timeframe. really that's we're So kind focused our is better the November of on.

I at comfort other The think that essentially X some have with being complete units now in right China. thing that is do being you should have take is that a design. demonstrated in a start-up do we technology in least We

of a I think taken lot the we've this factors cause a that that have new more XX% of and there us contingency additional are confidence to fact estimate. today lot

we're all having future out, acknowledge don't is we how to don't before, – make we you our all turn and got will is know know, it and that, with our think I can judgment what Now reasonable conditions said I additional seen we giving the this most we've contingency.

Praful Mehta

when sales asset Got secondly, multiple. higher value the within is at the accretive trading, need, to within is look that multiples. same made different I'm questions you your you. internally, Southern trading you clearly you sure Fair was one where fund of value are for you in portfolio at at pieces don't enough. you're in to at business your of getting of But Southern entire one it's potential it the relative earlier look multiple of equity those because different the some it's a on the as as sales terms assets points or asset Understood. And

Thomas A. Fanning

Absolutely.

Praful Mehta

multiple. it's So really it compare consolidated probably unfair to to Southern

I at, and an when wanted So kind of multiple? the you is benchmarking you to are right divest okay, and look just how look what you as check price assets, to try to you compare when accretive

Thomas A. Fanning

else something see. use it's trying just Yeah. I'm Praful, absolutely everybody that to can right.

the be relative in it to would both and SONAD buy use bought – people that we what at the at trying for And anecdotal an pretty benchmark to asset. paid is enormously knowledge LDC in Elizabethtown. of well they reasonable and times And the at, gosh, I'm information, selling can was of Gulf with to look think look which close well, were say, willing sell, Florida respect you clear think those highest It about would in very XX to if electric second the we there price. and pay Okay. to Piedmont you being respect for just kind that ever a multiple it price we've bought was just an look and conditions accretive. we that in sold the multiple pieces how you prices. kind the an NextEra went our essentially, with anyway when what give The off made earnings first paid it everybody we well that, and pretty to AGL how certain LDC, at of highest those are I – would City assets. I even we're for them for very of

by absolutely asset every right. a return have example. profile for we Power that include those per as asset every owned asset certainly You're risk We own every and are Southern unique for that would

everybody shorthand on My the of can Street So is right. internally. we your that and talking exactly point knowing without how vagaries point something is through to just every asset the value

Andrew W. Evans

focus And of think in consistent It's risk for asset. and we growth pretty always return. an of what on its Tom, investment, its And Praful scope. about, really opportunity terms evaluating and the you scale talk I that's with

have it the And additional multi-variable do We really a our so shareholders equation. to issuing it costs equity. is to of compare to

market the I Tom where evaluate maybe advantage all five a take or dislocations aggressively but think is options equity six certain we we major the segments normal that really of feel still lot more in that we that than criteria talked will the portfolio in pressure, but billion the $X.X valuing core, others. today be within comfortable have of to of investment certainly versus about that can issued without course is

Praful Mehta

Understood. you. guys that. there, job appreciate have asset so done and you. surely with great the Got Thanks sales a you Thank

Thomas A. Fanning

Thank bet. you. your Appreciate questions. You

Operator

Khan Ashar with of from Verition. proceed. the Please question comes next line Our

Your line is open.

Thomas A. Fanning

Ashar. Hello,

Ashar Khan

are get doing? a just I can. trying was to forward Hi, you good of going morning. powers better the I sense earning if How

year, from factors, the of if you have four as subsidiaries lower and correctly understand this which better from So for I that the your is because said earnings you dilution are plans. improved earnings equity

not forward? completed or sales for that do that much assets is for us forecast? you the base you So has out have which lose the to I to sale sales, part can earnings how a do from how take been the were that one probably you asset one that I on that we if build earnings you going which dollar profile the going those on you and right think have from in XXXX them as much announced is can so And help forward, don't earnings we part a say from know of if Except us this forma guidance? from to-date the have announced be sales and which have will announced asset NextEra do the transactions, XXXX lose will of Can be or basis? completed pro help that

Thomas A. Fanning

the back I'm of correct plus so way it case, our transactions, Go billion transaction incremental of earnings value we was $X Yes, sure. than I the Yeah, and or at you this and the by we got me Florida accretive, Drew X% shot generated $X.XX market the whatever. offset the at and first $X.XX on the let the actually – for, equity XX% earnings. lost time. The that we to Drew, let therefore and you math take gave more sold in cap looking of

Okay.

of just So X, the if remove by we're Power $X.XX able created earnings transaction. but because the value increase you by over we you lose Gulf to of earnings

Okay.

so And account And was the of earnings was accretive, high, to... equity debt the into of and earnings. of takes removing and those that price all an able because we're So what removal the even underlying, it everything asset.

Ashar Khan

by the accretive is It was $X.XX accretion exact? what or

Thomas A. Fanning

shock against on give in further with wanted We of transaction, $X.XX absorber the to FFO to that we our it debt NextEra – reductions about we debt that took build said with more we one was on a little than Florida into quality. Yeah. better to even applied $X.XX, actually actually and What the and little margin that was calculation. us the we credit really and the half a did what

then X% range. did still Florida the the therefore, assets, X% we remaining we're The our to X% we to second the $X.XX to X% so, then established within said had ability within to range, or earn the part, improved Recall we X% the X%.

which the of of $X.XX a within this transaction, XXXX-XXXX nothing. even what we're $X.XX, carry there's the there. range. around moved don't we we in do said And somewhere higher as within range, And Drew, this anything, then, we what And we said, conceptually our as for will we beginning earnings we a if lessen continuation hard there's year result kind that do then to the So if negative and still equity plans, eliminate that were strategies. answer. was our investor-friendly we said modernization I effect. well as what very And was, partially of improve work engine improving or other said

Andrew W. Evans

offset Florida and up $XXX and X% like the this activities cost for pretty to to the felt that internal We was led Well, And control try equity to reform asked write-down of within required the pushed bit us variety is a further our seminal maybe if more could toward maintain of related range. of factors. a implications are. but to that range. answer properties that a what subsidiaries the burden established. baseline Tom And we goal the off working each within the X% of is credit to talk and that million substantial what X% we've back said, of that been to quality to that about little as sale I'll equity sort generally utility equity a opportunistic requirement the dilution when event us XXXX lot growth of and with we've the couple little of the we so tax so reduced about range. a bit think us down you specifics moves X% of or it into And underlying its of related which still of other a the Certainly, that based-off a range, you modernization, of activity and raise

about you the rate as on EPS those they for when So things, we've loss growth generally net income and X%, impact is I are think our in described expected X% think, unchanged. but to basically the

Thomas A. Fanning

Hey, Ashar, the here. for I know record But you me just remind and us all know this. let

Units once the construction earnings this to we the as in in-service back rates. the normal Georgia are part X Vogtle to all for period we earnings assets and reduced rates, has some of X settlement in clears go While forward, to go

is aware you're And also to little so that. year-by-year But there earnings. our know I a a bit of of shake

Ashar Khan

build trying, to No, I'm was earnings you. aware my just – for XXXX I Tom, up profile

the seems and you call I have the that if I'm wanted February is taken, so. loaded way you the backend dilution as or the And before I surprised so, is third offset, even accretion if it it is announced things more said to guess you And which the you you this loaded. actions frontend in with it its it transaction or correctly, dilution will like year in do comes, I'm that doing not the announce that have the taken, that

and I as wanted more where in way in make help or in sure is right have And the week the or just sales the upfront the from we So the conclusion correct year profile of there essence, now asset earnings I'm near-term. my that going on are should accretion first wrong? which started August, the is to we

Thomas A. Fanning

glad you with of that. Ashar, of the be refine to with as kind call past practice we'd after And course to follow-up

Ashar Khan

Thank so you much. Okay.

you. So kind of

Thomas A. Fanning

sir. you Thank

Operator

our And final Associates. Patterson Paul from Glenrock the line of comes question with

Your line proceed. please is open

Thomas A. Fanning

Hey, Paul.

Paul Patterson

doing? you morning. me? Good hear Hey. How Can you

Thomas A. Fanning

sir. Yes

Paul Patterson

guess sort of are When a the increase, cost Vogtle. the at on on and – you increase terms quickly efficiency we looking sort anticipated? labor sort pure So cost of of just just breakdown itself in hadn't versus the is productivity of back the that of really there price I

Thomas A. Fanning

ask sorry, that I'm again. one

Paul Patterson

you you of a Well is it there other that labor that done get there's of sort of terms job a do what sort a than sounded – guys were of breakdown lot two Do the the people you sort costs correctly – words terms more in the efficiency just that's had that experiencing in have or of previously to sort understand components? have to expected. that in the the a sort of I you of versus productivity increase like employ

Thomas A. Fanning

that's Yeah, right.

the on hawks of know month. productive the we You that hours now in we're amount with things a keeping like involved right worked one of Paul, are is our eyes that

are kind We get by XX,XXX know now. ramp-up kind the November That's month we're don't that would need I hours that a to a to of I in in. XXX,XXX. the So of up right currently we say

And pipefitters on And is shared and second factors the One do we to once is about so and that. the work. the them electricians dialogue that's there's workers so thing really onsite getting people there, right. getting two get earlier all site, productive that we

with making are of we we that day So turn that produce and kind and ahead trend actually now in results sure accordance X-hours there're and if of drive That's cost. which in that will that think. a we wrenches we're now what right right the schedule, certainly following

Paul Patterson

Okay.

have my follow-up that's issues, mean, we in that so what terms aren't to it So you're in-service that, ahead should you, of you not of mean you is what you're that why are be is do doesn't – impacting the how ahead are is additional am hurdles follow seem you because saying, schedule? the cost of why that having guys in-service these delaying is your seeing extending schedule, I it I I but date, date, these schedule, productivity that of sort

Thomas A. Fanning

its we relates Well, own. about it think to Performance contingency has Bechtel above if really a which has the Bechtel, there. contract by being Cost and Index its has Bechtel and you own X are the performed work But

is order ahead is month I get performance as X.X Bechtel of to them been so, keep like we've – around somewhere a XX certainly think We'd saying. below talk in about schedule our been the We've to benchmark there. we if to think internally you on that I talking or get we'd think about below. X.X, about schedule X.XX, like

Paul Patterson

Okay.

Andrew W. Evans

in it's cost increase is risk taking, of about that the to think lot we're say lower schedule also to track half an that the and there. that's on a I of, fair effort stay

trade and completion funds. include a November in so additional the to these projects of XXXX. per wage activity the big these going of of is inflations component be decided lot certainly does we're spend why we've And a that's what diems, performing that of to And specialized

Thomas A. Fanning

attack and just way Yeah, another to this Paul thing.

would this, XX you – guess it's If go number, whatever, if but let about page indicate this performance or to this that that graph cost is me index there. X.XX just a back I around schedule June somewhere do at

Paul Patterson

it And that to it now.... this additional going then that terms just in just foreclosed be this, recovery is with cost mean, I any Okay. just you guys you're Have I sure of simply understand or to you – make not associated regulatory. guys foreclosed have seeking

Thomas A. Fanning

Yes, sir.

we $XXX We that are to going million. clear not are recovery the on seek

whether reasonable million real the recovery. our part to the a contingency We not the contingency. any subject practice, are we contingency, reason to there estimate no really the likes right and expenditure, reserving approve $XXX we is it have is decide or as in will that on because is cost becomes past Commission staff cap, included The of then that

Paul Patterson

Okay.

a Okay. lot. Thanks

Thomas A. Fanning

sir. Thank Operator, Yes, more you. any questions?

Operator

there further time, any questions. closing Sir, no No. remarks? there are At this are

Thomas A. Fanning

Certainly, that welcome. not news Yeah. Thanks is us joining everybody today. we this for

to represents I as reasonable how think it estimate a to proceed.

I regulatory relationships. think our it preserves

the I long-term through work And think range opinion we're a but risk Florida a today. think this attractive forward equitable transaction And good very order demonstrated of we've best run I us everybody a think, pain think it's return for modernization but preserve long pain, action shareholders, and preserves of value with to I to the all. you I performance. in to long-term the that's nod discussion performance profile of think with maintain able assessment we've joining think gain. announcement provide, stakeholders. that Thanks the long an soon. this in look shareholder. it our that our Operator, set the also as all this run how I performance this today think to chatting We today. investors. painful We short even I is our run I to efforts, current here preserves, and with top effects short-term know done this that's for But the is we've with our and with own the our impacts around EPS the really blown year worthwhile future

Operator

The XXXX gentlemen, quarter Ladies second and call. Southern sir. this you, Company's Thank concludes earnings

You may disconnect. now

We use cookies on this site to provide a more responsive and personalized service. Continuing to browse, clicking I Agree, or closing this banner indicates agreement. See our Cookie Policy for more information.