On July 31, 2024, Black Hills Corp (BKH, Financial) released its 8-K filing detailing the financial results for the second quarter of 2024. Black Hills Corp is a U.S.-based energy company that operates through its Electric Utilities, Gas Utilities, Corporate and Other segments, serving customers in the Midwest and mountain regions.
Performance Overview
For the second quarter of 2024, Black Hills Corp reported net income available for common stock of $22.8 million, or $0.33 per diluted share, compared to $23.1 million, or $0.35 per diluted share, in the same period last year. This result fell short of the analyst estimate of $0.39 per share. Revenue for the quarter was $205.1 million, up from $193.1 million in the second quarter of 2023, but still below the estimated $297.51 million.
Key Financial Achievements
Despite the mixed quarterly results, Black Hills Corp highlighted several financial achievements:
- Year-to-date earnings increased by 6% compared to the previous year.
- The company reaffirmed its 2024 earnings guidance, projecting earnings per share (EPS) in the range of $3.80 to $4.00.
- Black Hills Corp's board of directors approved a quarterly dividend of $0.65 per share, marking 54 consecutive years of dividend increases.
- The company completed a public debt offering of $450 million in senior unsecured notes due in 2035.
Segment Performance
Black Hills Corp's performance across its segments was as follows:
| Segment | Q2 2024 Operating Income | Q2 2023 Operating Income |
|---|---|---|
| Electric Utilities | $46.3 million | $46.6 million |
| Gas Utilities | $23.0 million | $17.7 million |
| Corporate and Other | $1.3 million | $(0.8) million |
Challenges and Strategic Initiatives
Black Hills Corp faced several challenges, including mild weather conditions and the absence of a prior year income tax benefit. However, the company managed to offset these impacts through new rates, rider recovery, and lower operating expenses.
Strategically, Black Hills Corp is advancing regulatory activities to recover investments and costs. The company is also making significant strides in its clean energy initiatives, including a plan to reduce emissions by 80% by 2030 in Colorado and adding 100 megawatts of utility-owned generation in South Dakota by 2026.
Commentary
"Year-to-date earnings were up 6% compared to last year and we are reaffirming our earnings guidance for the year," said Linn Evans, president and CEO of Black Hills Corp. "We continue to deliver progress on our customer-focused strategy and are excited about powering Meta’s newest AI data center in Cheyenne, which we expect to begin serving in 2026."
Financial Metrics
Key financial metrics for the second quarter include:
- Operating income: $70.6 million, up from $63.5 million in Q2 2023.
- Interest expense: $42.6 million, compared to $41.5 million in Q2 2023.
- Income tax expense: $3.7 million, compared to a benefit of $6.1 million in Q2 2023.
Analysis
Black Hills Corp's performance in the second quarter of 2024 reflects a balanced approach to managing operational challenges and strategic growth initiatives. While the company missed analyst estimates for EPS, its reaffirmation of the 2024 earnings guidance and continued dividend growth underscore its commitment to shareholder value. The ongoing regulatory activities and clean energy projects are expected to bolster the company's long-term growth prospects.
For more detailed insights and to access the full earnings report, visit the 8-K filing.
Explore the complete 8-K earnings release (here) from Black Hills Corp for further details.
