Q2 2024 Nextera Energy Inc and Nextera Energy Partners LP Earnings Call Transcript
Key Points
- NextEra Energy Partners LP (NEP) reported a strong second-quarter performance with adjusted earnings per share increasing by more than 9% year over year.
- The company has identified a record $460 million in run-rate cost savings opportunities through 2027, benefiting both NEP and its customers.
- Energy Resources added over 3,000 megawatts of new renewables and storage projects to the backlog this quarter, marking the second-best origination quarter ever.
- NEP has a 300-gigawatt pipeline, half of which is in the interconnection queue process or already interconnection ready, positioning the company well for future growth.
- The partnership has approximately $2.7 billion of liquidity, providing a strong financial position to support future investments and growth.
- The reserve amortization mechanism has been utilized faster than expected due to accelerated growth, leading to a potential $0.06 impact on earnings per share in both 2024 and 2025.
- Contributions from the gas infrastructure business decreased by $0.07 per share due to higher depletion expense, non-recurring items, and the sale of Texas pipelines.
- The partnership's payout ratio is expected to be in the mid to high 90s through 2026, indicating a high level of cash distribution relative to earnings.
- There is uncertainty around the future of the IRA (Inflation Reduction Act) and potential political risks, although the company remains optimistic about the stability of renewable energy credits.
- The company faces challenges in managing supply chain risks and ensuring timely deployment of new projects, although it has made significant efforts to mitigate these risks.
Good day, and welcome to the NextEra Energy and NextEra Energy Partners LP second-quarter 2024 earnings conference call. (Operator Instructions)
Please note this event is being recorded. I would now like to turn the conference over to Mark Eidelman, Director of Investor Relations. Please go ahead.
Thank you, Danielle. Good morning, everyone, and thank you for joining our second-quarter 2024 combined financial results conference call for NextEra Energy and NextEra Energy Partners.
With me this morning are John Ketchum, Chairman, President, and Chief Executive Officer of NextEra Energy; Brian Bolster, Executive Vice President and Chief Financial Officer of NextEra Energy; Rebecca Kujawa, President and Chief Executive Officer of NextEra Energy Resources; Mark Hickson, Executive Vice President of NextEra Energy, all of whom are officers of NextEra Energy Partners, as well as Armando Pimentel, President and Chief Executive Officer of Florida Power & Light Company.
John will start with opening
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