AEP Reports Third-Quarter 2024 Earnings, Introduces New Growth Rate and Capital Plan
- Third-quarter 2024 GAAP earnings of
$1.80 per share; operating earnings of$1.85 per share - Narrows 2024 operating earnings (non-GAAP) guidance to
$5.58 to$5.68 per share, maintaining$5.63 midpoint - Announces new long-term growth rate of 6% to 8% based off of 2025 operating earnings guidance of
$5.75 to$5.95 per share - Expands five-year capital plan to
$54 billion to support reliability and demand growth
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Preliminary, unaudited results |
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|
Third Quarter
ended |
|
Year-to-date ended |
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|
|
2024 |
2023 |
Change |
|
2024 |
2023 |
Change |
Revenue ($ in billions): |
5.4 |
5.3 |
0.1 |
|
15.0 |
14.4 |
0.6 |
|
Earnings ($ in millions): |
|
|
|
|
|
|
|
|
|
GAAP |
959.6 |
953.7 |
5.9 |
|
2,303.0 |
1,871.9 |
431.1 |
|
Operating (non-GAAP) |
985.4 |
923.8 |
61.6 |
|
2,317.8 |
2,077.6 |
240.2 |
|
|
|
|
|
|
|
|
|
EPS ($): |
|
|
|
|
|
|
|
|
|
GAAP |
1.80 |
1.83 |
(0.03) |
|
4.35 |
3.62 |
0.73 |
|
Operating (non-GAAP) |
1.85 |
1.77 |
0.08 |
|
4.38 |
4.02 |
0.36 |
|
||||||||
EPS based on 532 million shares 3Q 2024, 520 million shares 3Q 2023, 529 million shares YTD 2024 and 517 million shares YTD 2023 |
Operating earnings is a non-GAAP measure representing GAAP earnings excluding special items. On a year-to-date basis, the variance between GAAP and operating earnings is
"Our results this quarter were driven by our continued investments to improve service and enhance the energy system to meet the needs of our customers and communities. Based on our progress so far this year, we are tightening our 2024 earnings guidance range and maintaining the
"We are committed to providing best-in-class service, driving operational excellence and exercising financial discipline to improve results and create more value for our customers, investors and all stakeholders. AEP has a strong foundation and significant growth opportunities ahead, and we are confident in our ability to execute our strategy and deliver on our promises. This confidence is reflected in our new 6%-8% long-term growth rate and expanded capital investment plan of
"The foundation of our 2025 earnings guidance range is based on robust growth in our regulated businesses as we invest in a reliable, resilient grid and new generation opportunities to serve unprecedented load growth. The range also reflects lower contributions from our Generation & Marketing segment due to the reduced scope of activities in this segment going forward," Fehrman said.
"Commercial load has increased more than 10% year-over-year through the third quarter, and our updated sales projections show that pace accelerating. We expect commercial load to grow an average of 20% annually over the next three years based on customer contracts signed so far. In fact, we now have financial agreements from customers for 20 gigawatts of commercial and industrial load additions through the end of the decade, primarily in
"We continue to work with our regulators to ensure costs are fairly allocated so we can keep customer rates affordable and make sure all customers benefit from the investments needed to support the growth of data processors and other economic development projects," he said.
"We recently implemented leadership and alignment changes to streamline our corporate structure, move decision making closer to customers and ensure the businesses that drive our revenue have the support they need to improve performance. We also continue to engage our employees to identify process improvements and efficiencies that will reposition the company to support sustainable growth and customer affordability," Fehrman added.
SUMMARY OF RESULTS BY SEGMENT |
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|
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$ in millions |
||||||
|
||||||
GAAP Earnings |
3Q 24 |
3Q 23 |
Change |
YTD 24 |
YTD 23 |
Change |
|
571.5 |
512.5 |
59.0 |
1,198.0 |
1,051.6 |
146.4 |
|
245.2 |
206.0 |
39.2 |
542.3 |
508.4 |
33.9 |
AEP Transmission Holdco (c) |
214.7 |
202.9 |
11.8 |
624.1 |
580.8 |
43.3 |
Generation & Marketing (d) |
93.3 |
130.7 |
(37.4) |
226.1 |
(59.3) |
285.4 |
All Other |
(165.1) |
(98.4) |
(66.7) |
(287.5) |
(209.6) |
(77.9) |
Total GAAP Earnings (Loss) |
959.6 |
953.7 |
5.9 |
2,303.0 |
1,871.9 |
431.1 |
|
|
|
|
|
|
|
Operating Earnings (non-GAAP) |
3Q 24 |
3Q 23 |
Change |
YTD 24 |
YTD 23 |
Change |
|
572.4 |
520.0 |
52.4 |
1,117.5 |
1,045.6 |
71.9 |
|
245.2 |
206.0 |
39.2 |
610.8 |
488.2 |
122.6 |
AEP Transmission Holdco (c) |
214.7 |
202.9 |
11.8 |
632.3 |
580.9 |
51.4 |
Generation & Marketing (d) |
99.2 |
92.8 |
6.4 |
225.6 |
204.1 |
21.5 |
All Other |
(146.1) |
(97.9) |
(48.2) |
(268.4) |
(241.2) |
(27.2) |
Total Operating Earnings (non-GAAP) |
985.4 |
923.8 |
61.6 |
2,317.8 |
2,077.6 |
240.2 |
|
|
A full reconciliation of GAAP earnings with operating earnings is included in tables at the end of this news release. |
|
|
|
a. |
Includes AEP Generating Co., |
b. |
|
c. |
Includes wholly-owned transmission-only subsidiaries and transmission-only joint ventures |
d. |
Includes AEP OnSite Partners, |
|
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EARNINGS GUIDANCE
AEP narrowed its 2024 operating earnings guidance range to
Reflecting special items recorded through the third quarter, the estimated earnings per share on a GAAP basis would be
2024 EPS Guidance Reconciliation |
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|
Estimated EPS on a GAAP basis |
|
to |
|
|
|
|
|
Mark-to-market impact of commodity hedging activities |
|
(0.09) |
|
|
|
|
|
Remeasurement of Excess ADIT Regulatory Liability |
|
(0.09) |
|
|
|
|
|
Impact of NOLC on Retail Rate Making |
|
(0.50) |
|
|
|
|
|
Disallowance - |
|
0.02 |
|
|
|
|
|
Provision for Refund - Turk Plant |
|
0.24 |
|
|
|
|
|
Sale of |
|
0.02 |
|
|
|
|
|
Severance Charges |
|
0.18 |
|
|
|
|
|
Federal EPA Coal Combustion Residuals Rule |
|
0.21 |
|
|
|
|
|
SEC Matter Loss Contingency |
|
0.04 |
|
|
|
|
|
Operating EPS Guidance |
|
to |
|
|
|
|
|
WEBCAST
AEP's quarterly discussion with financial analysts and investors will be broadcast live over the internet at
AEP's earnings are prepared in accordance with accounting principles generally accepted in
ABOUT AEP
Our team at
WEBSITE DISCLOSURE
AEP may use its website as a distribution channel for material company information. Financial and other important information regarding AEP is routinely posted on and accessible through AEP's website at https://www.aep.com/investors/. In addition, you may automatically receive email alerts and other information about AEP when you enroll your email address by visiting the "Email Alerts" section at https://www.aep.com/investors/.
---
This report made by
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Financial Results for the Third Quarter of 2024 |
|||||||||||||||
Reconciliation of GAAP to Operating Earnings (non-GAAP) |
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|
2024 |
||||||||||||
|
|
|
Vertically |
|
Transmission |
|
AEP |
|
Generation |
|
Corporate |
|
Total |
|
EPS (a) |
|
|
|
($ in millions) |
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Earnings (Loss) |
|
571.5 |
|
245.2 |
|
214.7 |
|
93.3 |
|
(165.1) |
|
959.6 |
|
$ 1.80 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special Items (b) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mark-to-Market Impact of Commodity Hedging Activities |
(c) |
0.9 |
|
— |
|
— |
|
5.9 |
|
— |
|
6.8 |
|
0.01 |
|
SEC Matter Loss Contingency |
(d) |
— |
|
— |
|
— |
|
— |
|
19.0 |
|
19.0 |
|
0.04 |
Total Special Items |
|
0.9 |
|
— |
|
— |
|
5.9 |
|
19.0 |
|
25.8 |
|
$ 0.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Earnings (Loss) (non-GAAP) |
|
572.4 |
|
245.2 |
|
214.7 |
|
99.2 |
|
(146.1) |
|
985.4 |
|
$ 1.85 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
|
Financial Results for the Third Quarter of 2023 |
|||||||||||||||
Reconciliation of GAAP to Operating Earnings (non-GAAP) |
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
2023 |
||||||||||||
|
|
|
Vertically |
|
Transmission |
|
AEP |
|
Generation |
|
Corporate |
|
Total |
|
EPS (a) |
|
|
|
($ in millions) |
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Earnings (Loss) |
|
512.5 |
|
206.0 |
|
202.9 |
|
130.7 |
|
(98.4) |
|
953.7 |
|
$ 1.83 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special Items (b) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mark-to-Market Impact of Commodity Hedging Activities |
(c) |
7.5 |
|
— |
|
— |
|
(37.9) |
|
— |
|
(30.4) |
|
(0.06) |
|
Sale of Unregulated Renewables |
(e) |
— |
|
— |
|
— |
|
— |
|
0.5 |
|
0.5 |
|
— |
Total Special Items |
|
7.5 |
|
— |
|
— |
|
(37.9) |
|
0.5 |
|
(29.9) |
|
$ (0.06) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Earnings (Loss) (non-GAAP) |
|
520.0 |
|
206.0 |
|
202.9 |
|
92.8 |
|
(97.9) |
|
923.8 |
|
$ 1.77 |
|
|
(a) |
Per share amounts are divided by Weighted Average Common Shares Outstanding – Basic |
(b) |
Excluding tax related adjustments, all items presented in the table are tax adjusted at the statutory rate unless otherwise noted |
(c) |
Represents the impact of mark-to-market economic hedging activities |
(d) |
Represents an estimated loss contingency related to a previously disclosed |
(e) |
Represents third-party transaction costs related to the sale of the Competitive Contracted Renewable Portfolio |
|
||||||
Summary of Selected Sales Data |
||||||
Regulated Connected Load |
||||||
(Data based on preliminary, unaudited results) |
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|
|
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Three Months Ended |
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ENERGY & DELIVERY SUMMARY |
|
2024 |
|
2023 |
|
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential |
|
8,959 |
|
8,975 |
|
(0.2) % |
Commercial |
|
6,910 |
|
6,686 |
|
3.4 % |
Industrial |
|
8,562 |
|
8,731 |
|
(1.9) % |
Miscellaneous |
|
612 |
|
618 |
|
(1.0) % |
Total Retail |
|
25,043 |
|
25,010 |
|
0.1 % |
|
|
|
|
|
|
|
|
|
3,559 |
|
3,876 |
|
(8.2) % |
|
|
|
|
|
|
|
Total KWHs |
|
28,602 |
|
28,886 |
|
(1.0) % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential |
|
8,206 |
|
8,442 |
|
(2.8) % |
Commercial |
|
9,671 |
|
8,574 |
|
12.8 % |
Industrial |
|
6,725 |
|
6,601 |
|
1.9 % |
Miscellaneous |
|
213 |
|
220 |
|
(3.2) % |
Total Retail (b) |
|
24,815 |
|
23,837 |
|
4.1 % |
|
|
|
|
|
|
|
|
|
504 |
|
485 |
|
3.9 % |
|
|
|
|
|
|
|
Total KWHs |
|
25,319 |
|
24,322 |
|
4.1 % |
|
|
(a) |
Includes off-system sales, municipalities and cooperatives, unit power and other wholesale customers |
(b) |
Represents energy delivered to distribution customers |
|
|||||||||||||||
Financial Results for Year-to-Date 2024 |
|||||||||||||||
Reconciliation of GAAP to Operating Earnings (non-GAAP) |
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|
|
|
|
|
|
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|
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|
|
|
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|
2024 |
||||||||||||
|
|
|
Vertically |
|
Transmission |
|
AEP |
|
Generation |
|
Corporate |
|
Total |
|
EPS (a) |
|
|
|
($ in millions) |
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Earnings (Loss) |
|
1,198.0 |
|
542.3 |
|
624.1 |
|
226.1 |
|
(287.5) |
|
2,303.0 |
|
$ 4.35 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special Items (b) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mark-to-Market Impact of Commodity Hedging Activities |
(c) |
17.9 |
|
— |
|
— |
|
(70.1) |
|
— |
|
(52.2) |
|
(0.09) |
|
Remeasurement of Excess ADIT Regulatory Liability |
(d) |
(44.6) |
|
— |
|
— |
|
— |
|
— |
|
(44.6) |
|
(0.09) |
|
Impact of NOLC on Retail Rate Making |
(e) |
(259.6) |
|
— |
|
— |
|
— |
|
— |
|
(259.6) |
|
(0.50) |
|
Disallowance - |
(f) |
11.1 |
|
— |
|
— |
|
— |
|
— |
|
11.1 |
|
0.02 |
|
Provision for Refund - Turk Plant |
(g) |
126.4 |
|
— |
|
— |
|
— |
|
— |
|
126.4 |
|
0.24 |
|
Sale of |
(h) |
— |
|
— |
|
— |
|
10.4 |
|
— |
|
10.4 |
|
0.02 |
|
Severance Charges |
(i) |
57.7 |
|
27.2 |
|
8.2 |
|
0.4 |
|
0.1 |
|
93.6 |
|
0.18 |
|
Federal EPA Coal Combustion Residuals Rule |
(j) |
10.6 |
|
41.3 |
|
— |
|
58.8 |
|
— |
|
110.7 |
|
0.21 |
|
SEC Matter Loss Contingency |
(k) |
— |
|
— |
|
— |
|
— |
|
19.0 |
|
19.0 |
|
0.04 |
Total Special Items |
|
(80.5) |
|
68.5 |
|
8.2 |
|
(0.5) |
|
19.1 |
|
14.8 |
|
$ 0.03 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Earnings (Loss) (non-GAAP) |
|
1,117.5 |
|
610.8 |
|
632.3 |
|
225.6 |
|
(268.4) |
|
2,317.8 |
|
$ 4.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Results for Year-to-Date 2023 |
|||||||||||||||
Reconciliation of GAAP to Operating Earnings (non-GAAP) |
|||||||||||||||
|
|
|
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|
|
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|
|
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|
|
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|
2023 |
||||||||||||
|
|
|
Vertically |
|
Transmission |
|
AEP |
|
Generation |
|
Corporate |
|
Total |
|
EPS (a) |
|
|
|
($ in millions) |
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Earnings (Loss) |
|
1,051.6 |
|
508.4 |
|
580.8 |
|
(59.3) |
|
(209.6) |
|
1,871.9 |
|
$ 3.62 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special Items (b) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mark-to-Market Impact of Commodity Hedging Activities |
(c) |
(1.7) |
|
— |
|
— |
|
174.9 |
|
— |
|
173.2 |
|
0.34 |
|
Termination of the Sale of Kentucky Operations |
(l) |
— |
|
— |
|
— |
|
— |
|
(33.7) |
|
(33.7) |
|
(0.06) |
|
Sale of Unregulated Renewables |
(m) |
— |
|
— |
|
— |
|
88.5 |
|
2.1 |
|
90.6 |
|
0.17 |
|
Change in Texas Legislation |
(n) |
(4.3) |
|
(20.2) |
|
0.1 |
|
— |
|
— |
|
(24.4) |
|
(0.05) |
Total Special Items |
|
(6.0) |
|
(20.2) |
|
0.1 |
|
263.4 |
|
(31.6) |
|
205.7 |
|
$ 0.40 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Earnings (Loss) (non-GAAP) |
|
1,045.6 |
|
488.2 |
|
580.9 |
|
204.1 |
|
(241.2) |
|
2,077.6 |
|
$ 4.02 |
|
|
(a) |
Per share amounts are divided by Weighted Average Common Shares Outstanding – Basic |
(b) |
Excluding tax related adjustments, all items presented in the table are tax adjusted at the statutory rate unless otherwise noted |
(c) |
Represents the impact of mark-to-market economic hedging activities |
(d) |
Represents the impact of the remeasurement of excess accumulated deferred income taxes in |
(e) |
Represents the impact of receiving IRS PLRs related to NOLCs in retail rate making (I&M, PSO and SWEPCo). Amount includes a reduction in excess accumulated deferred income taxes and activity related to prior periods |
(f) |
Represents the impact of a disallowance recorded at SWEPCo on the remaining net book value of the |
(g) |
Represents a provision for revenue refunds on certain capitalized costs associated with the Turk Plant |
(h) |
Represents the loss on the sale of AEP OnSite Partners |
(i) |
Represents the impact of AEP's recent workforce reduction program |
(j) |
Represents the impact of the Federal EPA Revised Coal Combustion Residuals Rule |
(k) |
Represents an estimated loss contingency related to a previously disclosed |
(l) |
Represents an adjustment to the loss on the expected sale of the Kentucky Operations which was terminated in |
(m) |
Represents the loss on the sale of the Competitive Contracted Renewable Portfolio and other related third-party transaction costs |
(n) |
Represents the impact of recent legislation in |
|
||||||
Summary of Selected Sales Data |
||||||
Regulated Connected Load |
||||||
(Data based on preliminary, unaudited results) |
||||||
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|
Nine Months Ended |
||||
ENERGY & DELIVERY SUMMARY |
|
2024 |
|
2023 |
|
Change |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential |
|
24,191 |
|
23,406 |
|
3.4 % |
Commercial |
|
18,763 |
|
17,781 |
|
5.5 % |
Industrial |
|
25,563 |
|
25,686 |
|
(0.5) % |
Miscellaneous |
|
1,718 |
|
1,684 |
|
2.0 % |
Total Retail |
|
70,235 |
|
68,557 |
|
2.4 % |
|
|
|
|
|
|
|
|
|
10,498 |
|
10,620 |
|
(1.1) % |
|
|
|
|
|
|
|
Total KWHs |
|
80,733 |
|
79,177 |
|
2.0 % |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential |
|
21,079 |
|
20,618 |
|
2.2 % |
Commercial |
|
26,871 |
|
22,711 |
|
18.3 % |
Industrial |
|
20,363 |
|
19,800 |
|
2.8 % |
Miscellaneous |
|
573 |
|
565 |
|
1.4 % |
Total Retail (b) |
|
68,886 |
|
63,694 |
|
8.2 % |
|
|
|
|
|
|
|
|
|
1,347 |
|
1,366 |
|
(1.4) % |
|
|
|
|
|
|
|
Total KWHs |
|
70,233 |
|
65,060 |
|
8.0 % |
|
|
(a) |
Includes off-system sales, municipalities and cooperatives, unit power and other wholesale customers |
(b) |
Represents energy delivered to distribution customers |
View original content to download multimedia:https://www.prnewswire.com/news-releases/aep-reports-third-quarter-2024-earnings-introduces-new-growth-rate-and-capital-plan-302297289.html
SOURCE