On January 25, 2024, NextEra Energy Inc (NEE, Financial) released its 8-K filing, announcing robust financial results for the fourth quarter and the full year of 2023. The company, known for its regulated utility Florida Power & Light (FPL) and its competitive clean energy business NextEra Energy Resources (NEER), has demonstrated significant growth in both operational performance and financial metrics.
Company Overview
NextEra Energy's regulated utility, Florida Power & Light, is the largest rate-regulated utility in Florida, distributing power to nearly 6 million customer accounts and owning 32 gigawatts of generation capacity. FPL contributes roughly 70% of NextEra's consolidated operating earnings. The renewable energy segment, NextEra Energy Resources, generates and sells power throughout the United States and Canada with more than 25 GW of generation capacity, including natural gas, nuclear, wind, and solar.
Financial Performance and Challenges
NextEra Energy reported a GAAP net income of $1.210 billion, or $0.59 per share, for the fourth quarter of 2023, a decrease from $1.522 billion, or $0.76 per share, in the same quarter of the previous year. However, on an adjusted basis, the company's earnings were $1.067 billion, or $0.52 per share, compared to $1.011 billion, or $0.51 per share, in the fourth quarter of 2022. This growth in adjusted earnings per share of approximately 9.3% year-over-year highlights the company's ability to increase profitability despite challenges in the energy sector.
For the full year 2023, NextEra Energy's GAAP net income was $7.310 billion, or $3.60 per share, compared to $4.147 billion, or $2.10 per share, in 2022. Adjusted full-year earnings were $6.441 billion, or $3.17 per share, up from $5.742 billion, or $2.90 per share, in 2022. The company attributes its strong performance to operational excellence and financial discipline at both FPL and NEER.
Financial Achievements and Industry Significance
The company's financial achievements are particularly noteworthy in the Utilities - Regulated industry, where consistent performance and reliable dividends are valued by investors. NextEra Energy's record year of new renewables and storage origination, with approximately 9,000 megawatts added to its backlog, positions it as a leader in the transition to clean energy. Moreover, the company's commitment to dividend growth aligns with the expectations of value investors looking for stable and growing income streams.
Key Financial Metrics
NextEra Energy's financial strength is further evidenced by its capital expenditures and customer growth. FPL's capital expenditures for the fourth quarter of 2023 were approximately $2 billion, contributing to a full-year total of roughly $9.4 billion. This level of investment supports the company's infrastructure and service reliability, which is critical for customer satisfaction and regulatory compliance. Additionally, FPL's average number of customers increased significantly, reflecting the utility's ability to attract and retain customers in a competitive market.
Analysis and Outlook
Looking ahead, NextEra Energy's management remains confident in the company's long-term financial expectations. For 2024, the company anticipates an adjusted earnings per share range of $3.23 to $3.43. Furthermore, NextEra Energy projects a 6% to 8% growth rate off the 2024 adjusted earnings per share range for the years 2025 and 2026. This outlook underscores the company's commitment to delivering value to shareholders while maintaining a strong balance sheet and credit ratings.
NextEra Energy's solid financial results and optimistic outlook reflect its strategic positioning in the regulated utility and renewable energy markets. The company's focus on clean energy expansion and operational efficiency continues to drive growth, making it a compelling story for value investors and potential GuruFocus.com members.
Explore the complete 8-K earnings release (here) from NextEra Energy Inc for further details.
