Algonquin Power & Utilities Corp. Announces 2024 Third Quarter Financial Results
PR Newswire
OAKVILLE, ON, Nov. 7, 2024
Making progress in strategic transition to regulated utility
OAKVILLE, ON, Nov. 7, 2024 /PRNewswire/ - Algonquin Power & Utilities Corp. (TSX: AQN) $(AQN)$ ("AQN" or the "Company") announced today financial results for the third quarter ended September 30, 2024. All amounts are shown in United States dollars ("U.S. $" or "$"), unless otherwise noted.
"We continue to hit key milestones on our journey towards a simpler and more focused regulated business," said Chris Huskilson, Chief Executive Officer of AQN. "These successes include the announced sales of our renewables business and Atlantica ownership stake, completion of the rollout of our new IT platform, appointment of new corporate leadership, the simplification of our capital structure, and recent rate case filings to improve our earned returns. In all, we are proud of the progress we have made, though this is a multi-year journey and there is still much work to be done. We are committed to serving our customers and producing an appropriate return on our investments and we are confident we are on the right path to do so."
Third Quarter 2024 Financial Results for Continuing Operations(1)
-- Net Utility Sales2 of $442.9 million, an increase of 6%;
-- Adjusted EBITDA2 of $264.4 million, an increase of 4%;
-- Adjusted Net Earnings2 of $64.9 million, a decrease of 5%; and
-- Adjusted Net Earnings2 per common share of $0.08, a decrease of 20%, in
each case on a year-over-year basis.
Three months ended Nine months ended
September 30 September 30
------------------- --------------------------- ----------------------------
All amounts in U.S.
$ millions except
per share
information 2024 2023 Change 2024 2023 Change
------------------- --------- ------- ------- --------- -------- -------
Revenue(3) $ 573.2 $ 564.8 1 % $1,734.7 $1,818.3 (5) %
Regulated
Services Group
Revenue 563.9 555.9 1 % 1,705.8 1,790.5 (5) %
Hydro Group
Revenue 8.9 8.5 4 % 28.0 26.7 5 %
Corporate Group
Revenue 0.4 0.4 -- 1.0 1.1 (9) %
Net earnings (loss)
attributable to
shareholders from
continuing
operations 49.5 (174.9) 128 % 172.9 (184.3) 194 %
Per common share
from continuing
operations 0.06 (0.26) 123 % 0.23 (0.28) 182 %
Net earnings (loss)
attributable to
shareholders
including
discontinued
operations (1,305.7) (174.5) (648) % (1,194.1) (157.6) (657) %
Per common share
including
discontinued
operations (1.71) (0.26) (556) % (1.67) (0.24) $(596.SI)$ %
Cash provided by
operating
activities 66.7 132.6 (50) % 433.6 427.3 1 %
Adjusted Net
Earnings(2) 64.9 68.6 (5) % 186.8 198.2 (6) %
Per common share 0.08 0.10 (20) % 0.25 0.28 (11) %
Adjusted EBITDA(2) 264.4 254.9 4 % 790.5 751.4 5 %
Adjusted EBITDA(2)
for Regulated
Services Group 236.2 228.7 3 % 706.0 674.0 5 %
Adjusted EBITDA(2)
for Hydro Group 7.1 6.5 9 % 21.0 19.5 8 %
Adjusted EBITDA(2)
for Corporate
Group 21.1 19.7 7 % 63.5 57.9 10 %
Adjusted Funds from
Operations(2) 143.3 146.8 (2) % 434.1 433.5 --
Dividends per
common share 0.0650 0.1085 (40) % 0.2820 0.3255 (13) %
Long-term Debt 7,475.7 7,500.2 -- 7,475.7 7,500.2 --
------------------- --------- ------- ------- --------- -------- -------
(1) AQN's operations are now organized across three business units consisting
of: the Regulated Services Group, which primarily owns and operates a
portfolio of regulated electric, water distribution and wastewater
collection and natural gas utility systems and transmission operations in
the United States, Canada, Bermuda and Chile; the Hydro Group, consisting
of the hydroelectric business which is not being sold as a part of the
renewables business; and the Corporate Group, which includes corporate
and service companies as well as the Company's investment in Atlantica.
(2) Please refer to "Non-GAAP Measures" below for further details.
(3) Discontinued Operations Revenue for the three months and nine months
ended September 30, 2024 totaled $66.3 million and $240.5 million,
respectively, versus $60.0 million and $213.0 million for the three
months and nine months ended September 30, 2023.
Third Quarter 2024 Operational Results and Corporate Actions
-- Regulated Services Group saw growth from implementation of new rates,
offset by higher depreciation, higher financing costs and greater share
count - The Regulated Services Group recorded third quarter
year-over-year growth in Adjusted EBITDA of 3% (see "Non-GAAP Measures"
below), due to the implementation of new rates, most notably at the
Bermuda, CalPeco, Empire Arkansas Electric utilities, and New York Water
utility. New rates were more than offset by higher operating expenses,
and depreciation. Additionally, the June, 17 2024 settlement of share
purchase contracts related to AQN's green equity units drove a higher
year-over-year share count.
-- New York Water settlement approval constructively concludes first rate
case since acquisition -- On August 15, 2024, the New York Public Service
Commission issued an order authorizing a $38.6 million increase in
revenues over a three-year rate plan for the Company's New York Water
utility, and including a 9.1% allowed return on equity and 48% equity
ratio. New rates became effective September 1, 2024, and are being
collected retroactive to April 1, 2024.
-- Upcoming rate cases mark meaningful steps toward closing earned return
gap -- On September 20, 2024, the Company filed a rate case for its
CalPeco Electric utility, seeking an increase in revenues of $39.8
million based on a return on equity of 11.0%, an equity ratio of 52.5%,
and additions to rate base of approximately $150 million through the end
of 2025. Additionally, on November 6, 2024, the Company filed a rate
case for its Empire Electric utility in Missouri, requesting
$92.1 million in revenue increases and predicated on a 10.0% allowed
return on equity. The rate case, if approved, would increase rate base
by approximately $534 million. Separately, the Company also expects to
file a rate case for its Litchfield Park Water utility in Arizona in the
first half of 2025. The three rate cases combined, if resolved in
accordance with the Company's expectations, would comprise over $700
million of the capital already invested by the Company but not yet
reflected in rates. Reducing regulatory lag continues to be a core
objective of AQN.
-- Announced sale agreement of Renewable Energy Business -- On August 9,
2024, the Company entered into an agreement to sell its renewable energy
business, excluding hydro, to a wholly-owned subsidiary of LS Power for
total cash consideration of up to $2.5 billion (subject to certain
closing adjustments). The Company has reclassified its renewable energy
business, excluding hydro, as "discontinued operations".
AQN's unaudited interim consolidated financial statements for the three and nine months ended September 30, 2024 and management discussion and analysis for the three and nine months ended September 30, 2024 (the "Interim MD&A") will be available on its website at www.AlgonquinPower.com and in its corporate filings on SEDAR+ at www.sedarplus.com (for Canadian filings) and EDGAR at www.sec.gov/edgar (for U.S. filings).
Earnings Conference Call
AQN will hold an earnings conference call at 10:00 a.m. eastern time on Thursday, November 7, 2024, hosted by Chief Executive Officer, Chris Huskilson, and Chief Financial Officer, Darren Myers.
Date: Thursday, November 7, 2024 ------------------ --------------------------------------------------------- Time: 10:00 a.m. ET ------------------ --------------------------------------------------------- Conference Call: Toll Free Dial-In Number 1 (800) 715-9871 ------------------ ---------------------------------- --------------------- Toll Dial-In Number 1 (647) 932-3411 ----------------------------------------------------- --------------------- Conference ID 7888098 ----------------------------------------------------- --------------------- Webcast: https://edge.media-server.com/mmc/p/eoi9utr9 ------------------ --------------------------------------------------------- Presentation also available at: www.algonquinpower.com ----------------------------------------------------------------------------
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