Sentiment Analysis of the earnings transcript to help figure out if there are any bullish or bearish sentiments that could be gathered from it. We're doing ML and AI based analysis on the earnings call to get some more insights.
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| So you can see on an overall basis, strong performance in 2023, resulting on an adjusted non-GAAP basis with $3.20 versus $3.18 in 2022 or a 2.8% improvement |
| So we feel very good about the opportunities for this company on a going forward basis |
| Driven by thematically the same types of things driving our numbers as drove Q4, $0.20 of improvement overall before you get to share count dilution was driven by regulatory execution, as we talked about here, driving really recovering our costs that we need to serve customers and also improving our earned returns |
| The second thing is just a fantastic coordination of our operating folks to serve our customers when they need it most |
| That means days of minus 45-degree weather, very, very proud of our team and our ability to serve our customers |
| And one of the recent highlights was our ability to serve our customers in a cold snap in the middle of January |
| And importantly, as I slide to the balance sheet, really on the next slide, positioning us in a point of strength as we move forward |
| So $3.2 million there or $0.05 adjusted out on a fourth quarter basis, you can see that leads to significant improvement over the prior period of $1.38 on a non-GAAP basis versus $1.13 last year or 22% |
| And all of this, I think, leaves us in a good spot from both a shareholder perspective but importantly, to our customers as well to deliver to them |
| We continue to have higher reliability for our customers, two very good rate reviews in both Montana and South Dakota through settlements again, properly balancing what affordability for our customers and what we need in essence, to continue to be a strong financial company to serve those customers |
| Very good outcome and getting to a holdco something we've been thinking about and trying to put in place for many years |
| We felt very, very good about 2023 and all that we accomplished |
| But notably, I would mention that financial performance overall in Q4 was a bit stronger than we had expected, driven by final clarity in the Montana rate review related to ultimately the PCCAM piece and retroactivity of that and also income taxes |
| And we currently believe there's certainly upside to opportunity as planned, but it's balanced to provide us a strong balance sheet, a self funded plan, managing the impact of customers revolve on overall rates, while importantly focused on the reliability needs of our customers as well |
| Congrats on the strong results and all the regulatory achievements |
| I would mention that in South Dakota, we have a very strong relationship with the South Dakota Commission and staff |
| First and foremost, we have been one of our best safety years as a company |
| And again, I would just say in the face of unfavorable weather and timing of rates and final outcomes there, the most significant piece is working with our commissions on regulatory execution, driving important improvement in our earnings results and what we deliver to shareholders |
| So you can see a significant improvement overall at the margin line |
| Brian’s already mentioned, overall, the strength of our investor thesis and where we see our earnings growth rate at a 4% to 6% EPS growth, we had announced 2024 guidance in Q4 of a $3.42 to $3.62, and we are reaffirming that here |
| Lastly, being able to look at our plant and work really hard to identify means to increase our growth rate, long term earnings growth rate to 4% to 6% |
| We have also affirmed and separated out our strong credit ratings in Q4 as we worked with the rating agencies in advance of our legal holding company reorganization, which I will speak to a little bit more in a minute but affirmed our credit ratings with each of the agencies |
| But with that is where we sit today and a base capital plan with a 4% to 6% EPS growth rate based upon capturing the value of $2.5 billion of investment provides a total return opportunity of 9% to 11%, which is fantastic |
| That margin improvement was the most significant portion of that, offset by a $0.16 swing in weather, I'll say that fast |
| We certainly are thinking about your best interest here as well and hopefully that improved your performance will meet your expectations |
| And that's for '23 is a great setup for 2024, we're very excited about that, we need to certainly obviously execute on our plan, we need to stay focused on safety, we obviously need to balance reliability, affordability and sustainability as a company |
| First, Brian and Crystal, you guys mentioned all of the good things you've accomplished and you're surprised to see the 5% dividend yield and we are too |
| So a significant capital plan here to invest and deliver to our customers supported by debt issuances, which will include a bit of refinancing and then a very manageable overall financing plan to support that capital structure and leave us where we need to be, and importantly, in a balance sheet and a position of strength as we move forward |
| We're very focused on getting to a revenue number overall that supports an earned return that is in line with where we expect to be and the approach that, that commission may take might look like an overall lower approach to ROE, but a solid approach to giving us the total revenue recovery that we need |
| In addition, you'll see we have $0.11 of the improvement in income taxes versus the prior period, driven by the release of a tax reserve, which is adjusted out and we'll talk about that in more detail in a minute here |
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| Offsetting that improvement, as I've already spoken to, was unfavorable weather during the period, driving lower volumes |
| So we saw $0.06 of unfavorable weather this year |
| We took great steps way back in January of 2023 of announcing incremental coal strip to come into service and 1/1/26 for us, obviously, continue to fight through many challenges on Yellowstone County with that plant being online from our perspective to serve customers for our summer peak |
| I'm sure you all recall that last year, as we close out the year, we were talking about an unfavorable impact of $7.2 million to us in 2022 |
| I think we are addressing balance sheet concerns |
| So for 2023, we had $0.05 of unfavorable weather impacting us |
| We certainly see volumetric swings there |
| So a significant swing versus the detriment we had in our earnings last year to favorability in 2023 |
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