• Net Loss on Divestiture: $524 million aggregate net loss from the offshore wind divestiture.
• GAAP Earnings: Loss of $0.33 per share for Q3.
• Recurring Earnings: $1.30 per share in Q3, compared to $0.97 per share last year.
• Electric Transmission Earnings: $0.49 per share, up from $0.46 per share in 2023.
• Electric Distribution Earnings: $0.57 per share, up from $0.50 per share in 2023.
• Natural Gas Distribution Loss: $0.09 per share, improved from a $0.10 per share loss last year.
• Water Distribution Earnings: $0.07 per share, up from $0.05 per share last year.
• Parent and Other Earnings: $0.09 per share, up from $0.06 per share last year.
• Full Year 2024 EPS Guidance: Updated to $4.52 to $4.60 due to higher interest expense.
• Five-Year Capital Investment Forecast: Increased to $23.7 billion.
• Equity Raised: Approximately $1 billion through ATM program and 15.7 million common shares issued.

• Warning! GuruFocus has detected 10 Warning Signs with ES.

Release Date: November 05, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Eversource Energy (NYSE:ES) has successfully exited the offshore wind development business, focusing on $6 billion in transmission and over $10 billion in electric distribution infrastructure investments through 2028.
• The company secured approximately $90 million in federal funding for a clean energy hub in Southeastern Connecticut and $20 million from the US Department of Energy for a battery energy storage project in Massachusetts.
• Eversource Energy (NYSE:ES) received approval for its Electric Sector Modernization Plan (ESMP) in Massachusetts, which includes an additional $600 million in distribution investment.
• The company is recognized as a leader in clean energy transition, with significant regulated opportunities ahead, and was named the number one utility in the United States by Time Magazine.
• Eversource Energy (NYSE:ES) has raised approximately $1 billion of equity through its ATM program, enhancing its financial position and supporting its balance sheet improvement efforts.

Negative Points

• Eversource Energy (NYSE:ES) recognized an aggregate net loss of $524 million from the divestiture of its offshore wind investment.
• The company faces challenges in strengthening its balance sheet and improving its FFO to debt ratio, despite making progress.
• Higher-than-anticipated interest expenses have led to an update in the full-year 2024 recurring EPS guidance to a range of $4.52 to $4.60.
• The draft decision from PURA in Connecticut regarding AMI cost recovery has provisions that Eversource Energy (NYSE:ES) finds challenging, potentially impacting investment decisions.
• The company is dealing with increased construction costs and delays related to the Revolution Wind project, impacting financial results.

Q & A Highlights

Q: Can you provide an update on the discussions regarding Millstone and the involvement of Massachusetts in the dialogue? A: Joseph Nolan, CEO, explained that there is a strong working relationship between Rhode Island, Connecticut, and Massachusetts regarding clean energy. While he is not directly involved in pricing discussions, he is aware that the states are collaborating to secure clean energy for the region, given capacity constraints. He is confident that a beneficial solution for all New England customers will be reached.

Q: What are your obligations under the GIP agreement concerning the recent Orsted impairment? A: John Moreira, CFO, stated that Eversource took a significant charge related to Revolution Wind, factoring in known issues like the monopile concern. The company will continue to monitor progress with GIP and Orsted to mitigate exposure. Currently, no additional charges are anticipated.

Q: Could you provide more details on your equity issuance plans for 2025 and beyond? A: John Moreira, CFO, emphasized the focus on balance sheet improvement, noting that $1 billion in equity has been issued this year. The company plans to update its capital forecast and financing plan in the fourth quarter call, which will include equity needs for the forecast period.

Q: How does the recent decision on the Electric Sector Modernization Plan (ESMP) impact your capital investment forecast? A: John Moreira, CFO, confirmed that the ESMP decision allows for an additional $600 million in distribution investments, increasing the five-year capital investment forecast to $23.7 billion. This plan is part of a collaborative approach to enable clean energy and increase resiliency.

Q: What is the status of the Aquarion sale, and how does it fit into your financial strategy? A: Joseph Nolan, CEO, reported significant interest in the Aquarion asset, with the process expected to conclude in the first quarter of 2025. The sale is a key component of Eversource's financing plan, and they are confident in closing the transaction by the end of 2025.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.