Release Date: August 02, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Alliant Energy Corp (LNT, Financial) reaffirmed its 2024 ongoing EPS guidance range of $2.99 to $3.13.
- The company has executed multiple agreements with data centers in both Iowa and Wisconsin, indicating strong economic development potential.
- Successful execution of the company's customer-focused capital investment program supported new electric and gas rates.
- Alliant Energy Corp (LNT) reported strong cash flows from operations, increasing by approximately $250 million compared to last year.
- The company is well-positioned for future growth with a focus on clean energy solutions and economic development.
Negative Points
- The company recorded nonrecurring charges from legacy assets, impacting GAAP earnings.
- Weather headwinds resulted in a $0.01 reduction in earnings for the first half of the year.
- Decreased electric sales to a limited number of low-margin industrial customers offset positive residential sales.
- The Lansing Generating Station will not earn a return on its remaining book value, leading to a write-down.
- The EPA's revised coal combustion residuals rule resulted in increased asset retirement obligations and additional charges.
Q & A Highlights
Q: Can you quantify the modest equity needs mentioned on slide 8?
A: Robert J. Durian, Executive VP & CFO: We currently have a Shareowner Direct plan issuing approximately $25 million a year, which we see extending into the foreseeable future. This is the only material equity need planned at this stage. We may revisit this as we refresh our capital expenditure plans in November.
Q: How are you tracking in the 2024 earnings range considering weather headwinds?
A: Robert J. Durian, Executive VP & CFO: We've seen about a $0.01 reduction in earnings due to weather in the first half of the year. We have identified opportunities to offset some of these costs and have line of sight to about half of the necessary offsets. This gives us confidence to reaffirm our guidance range of $2.99 to $3.13.
Q: Can you elaborate on the data center contracts and load forecasts?
A: Lisa M. Barton, President, CEO & Director: We have executed multiple agreements with data centers, and once we have certainty on the load and timing, we will announce these projects. We will provide detailed updates on load forecasts, resource needs, and CapEx requirements during our third quarter earnings call.
Q: What are the upside and downside risks to the Iowa rate review settlement?
A: Lisa M. Barton, President, CEO & Director: The settlement is driven by economic development. Successful economic activities will fuel affordability and benefit shareholders. Robert J. Durian, Executive VP & CFO: There are provisions in the agreement allowing us to come back for rate cases if ROEs fall below a certain level, protecting us from significant decreases.
Q: How will advanced rate-making be applied going forward?
A: Robert J. Durian, Executive VP & CFO: The recent legislation expands eligibility to include energy storage facilities and new generation, opening up additional opportunities. Lisa M. Barton, President, CEO & Director: Iowa is dedicated to economic development, and the changes to advanced rate-making support this growth.
Q: Is there any ongoing earnings impact from the ending steam customer contracts in 2025?
A: Robert J. Durian, Executive VP & CFO: The impact is not significant. The agreements were structured to end in 2025, and the depreciation expense will also end, so the ongoing impacts should not be material.
Q: Can you frame the scope of capital needs before factoring in data centers?
A: Lisa M. Barton, President, CEO & Director: We are well-positioned with land, transmission access, and flexible rate mechanisms. We will provide detailed updates on load, timing, and resources needed during our third quarter earnings call.
Q: How should we think about the update to your load growth forecast?
A: Lisa M. Barton, President, CEO & Director: We will provide detailed updates once we have the information on load and timing.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
