Eversource Energy (ES, Financial) released its 8-K filing on November 4, 2024, reporting a loss of $(118.1) million, or $(0.33) per share, for the third quarter of 2024. This marks a significant decline from the earnings of $339.7 million, or $0.97 per share, in the same period last year. The company's performance was impacted by its strategic exit from offshore wind investments, resulting in a substantial after-tax loss.
Company Overview
Eversource Energy is a diversified holding company providing rate-regulated electric, gas, and water distribution services to over 4 million customers in the Northeast U.S. The company has expanded its service territories through acquisitions and recently exited its partnership with Orsted for offshore wind projects, focusing on its core regulated utility operations.
Performance and Challenges
The third quarter results reflect a challenging period for Eversource Energy, primarily due to the divestiture of its offshore wind investments, which led to a net after-tax loss of $524.0 million, or $1.48 per share, year-to-date. This strategic shift underscores the company's focus on its regulated utility operations, but also highlights the financial impact of exiting non-core businesses.
Financial Achievements
Despite the overall loss, Eversource Energy's non-GAAP recurring earnings showed improvement, with $405.9 million, or $1.13 per share, in Q3 2024, compared to $339.7 million, or $0.97 per share, in Q3 2023. This growth is crucial for a regulated utility company, as it reflects the stability and predictability of its core operations.
Segment Performance
The electric transmission segment earned $174.9 million in Q3 2024, up from $160.3 million in Q3 2023, driven by increased investments in the transmission system. The electric distribution segment also saw improved earnings of $203.5 million, compared to $173.3 million in the previous year, due to rate increases and system investments.
However, the natural gas distribution segment reported a loss of $(30.2) million, though this was an improvement from the $(33.7) million loss in Q3 2023. The water distribution segment showed positive growth, earning $23.7 million, up from $16.6 million in the same quarter last year.
Financial Metrics and Analysis
Key financial metrics indicate a mixed performance. The company's updated non-GAAP recurring earnings projection for 2024 is now between $4.52 and $4.60 per share, slightly adjusted due to higher interest expenses. Eversource Energy also increased its forecasted capital investments to $23.7 billion for 2024-2028, reflecting its commitment to infrastructure modernization.
“During the third quarter, we posted solid operational and financial results, once again displaying the talent and commitment of our diverse, dedicated team of over 10,000 employees,” said Chairman, President and CEO Joe Nolan.
Conclusion
Eversource Energy's Q3 2024 results highlight the challenges and opportunities faced by the company as it refocuses on its regulated utility operations. While the offshore wind divestiture impacted earnings, the company's core segments showed resilience and growth potential. As Eversource Energy continues to invest in its infrastructure, it remains well-positioned to deliver value to its stakeholders in the long term.
Explore the complete 8-K earnings release (here) from Eversource Energy for further details.
