- Quarterly results demonstrate continued improvement at core utility from 2023
- Expect to be at the low end of Avista Utilities guidance range
- Lowering earnings guidance for our other businesses due to lower than expected investment valuations
| Third Quarter | Year-to-Date | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net Income (Loss) by Business Segment: | ||||||||||||||||
| Avista Utilities | $ | 19,803 | $ | 13,498 | $ | 111,246 | $ | 83,935 | ||||||||
| AEL&P | 41 | 288 | 5,061 | 5,689 | ||||||||||||
| Other | (1,357 | ) | 930 | (3,467 | ) | (2,579 | ) | |||||||||
| Total net income | $ | 18,487 | $ | 14,716 | $ | 112,840 | $ | 87,045 | ||||||||
| Earnings (Loss) per Diluted Share by Business Segment: | ||||||||||||||||
| Avista Utilities | $ | 0.25 | $ | 0.18 | $ | 1.42 | $ | 1.10 | ||||||||
| AEL&P | - | - | 0.06 | 0.07 | ||||||||||||
| Other | (0.02 | ) | 0.01 | (0.04 | ) | (0.03 | ) | |||||||||
| Total earnings per diluted share | $ | 0.23 | $ | 0.19 | $ | 1.44 | $ | 1.14 | ||||||||
"We're excited to join the North Plains Connector transmission line project, and have signed a non-binding memorandum of understanding. This transmission line will be constructed with endpoints near Bismarck, North Dakota and Colstrip, Montana, which will improve regional reliability, diversify available resources, and support demand growth.
"With regard to our other businesses, we expected the private equity markets which drive valuations in our other businesses would improve in the latter half of 2024. That improvement has not materialized, and as a result, we are lowering our consolidated earnings guidance by $0.10 to $2.26 to $2.46 per diluted share for 2024," Vermillion added.
Non-GAAP Financial Measures
The tables below include electric and natural gas utility margin, two financial measures that are considered "non-GAAP financial measures.” The most directly comparable measure calculated and presented in accordance with GAAP is utility operating revenues.
The presentation of electric and natural gas utility margin is intended to enhance the understanding of operating performance, as it provides useful information to investors in their analysis of how changes in loads (due to weather, economic or other conditions), rates, supply costs and other factors impact our results of operations. These measures are not intended to replace utility operating revenues as determined in accordance with GAAP as an indicator of operating performance.
The following table reconciles Avista Utilities' operating revenues to utility margin (pre-tax and after-tax) for the three and nine months ended September 30 (dollars in thousands):
| Operating
Revenues | Resource
Costs | Utility
Margin (Pre-Tax) | Income
Taxes (a) | Utility Margin (Net of Tax) | ||||||||||||||||
| For the three months ended Sept. 30, 2024: | ||||||||||||||||||||
| Electric | $ | 316,692 | $ | 107,411 | $ | 209,281 | $ | 43,949 | $ | 165,332 | ||||||||||
| Natural Gas | 73,522 | 39,726 | 33,796 | 7,097 | 26,699 | |||||||||||||||
| Less: Intracompany | (6,468 | ) | (6,468 | ) | - | - | - | |||||||||||||
| Total | $ | 383,746 | $ | 140,669 | $ | 243,077 | $ | 51,046 | $ | 192,031 | ||||||||||
| For the three months ended Sept. 30, 2023: | ||||||||||||||||||||
| Electric | $ | 309,027 | $ | 116,729 | $ | 192,298 | $ | 40,383 | $ | 151,915 | ||||||||||
| Natural Gas | 74,323 | 43,741 | 30,582 | 6,422 | 24,160 | |||||||||||||||
| Less: Intracompany | (13,677 | ) | (13,677 | ) | - | - | - | |||||||||||||
| Total | $ | 369,673 | $ | 146,793 | $ | 222,880 | $ | 46,805 | $ | 176,075 | ||||||||||
| For the nine months ended Sept. 30, 2024: | ||||||||||||||||||||
| Electric | $ | 973,059 | $ | 364,798 | $ | 608,261 | $ | 127,734 | $ | 480,527 | ||||||||||
| Natural Gas | 411,379 | 226,446 | 184,933 | 38,836 | 146,097 | |||||||||||||||
| Less: Intracompany | (14,942 | ) | (14,942 | ) | - | - | - | |||||||||||||
| Total | $ | 1,369,496 | $ | 576,302 | $ | 793,194 | $ | 166,570 | $ | 626,624 | ||||||||||
| For the nine months ended Sept. 30, 2023: | ||||||||||||||||||||
| Electric | $ | 849,454 | $ | 301,764 | $ | 547,690 | $ | 115,015 | $ | 432,675 | ||||||||||
| Natural Gas | 378,242 | 206,460 | 171,782 | 36,074 | 135,708 | |||||||||||||||
| Less: Intracompany | (29,277 | ) | (29,277 | ) | - | - | - | |||||||||||||
| Total | $ | 1,198,419 | $ | 478,947 | $ | 719,472 | $ | 151,089 | $ | 568,383 | ||||||||||
| (a) | Income taxes for 2024 and 2023 were calculated using Avista Corp.'s federal statutory tax rate of 21 percent. |
Analysis of 2024 Consolidated Earnings
The table below presents the change in net income and diluted earnings per share for the third quarter and year-to-date 2024 as compared to the same periods in 2023, as well as the various factors, shown on an after-tax basis, that caused such change (dollars in thousands, except per-share data):
| Third Quarter | Year-to-Date | |||||||||||||||
| Net Income (a) | Earnings per Share | Net
Income (a) | Earnings per Share | |||||||||||||
| 2023 consolidated earnings | $ | 14,716 | $ | 0.19 | $ | 87,045 | $ | 1.14 | ||||||||
| Changes in net income and diluted earnings per share: | ||||||||||||||||
| Avista Utilities | ||||||||||||||||
| Electric utility margin (b) | 13,417 | 0.17 | 47,852 | 0.61 | ||||||||||||
| Natural gas utility margin (c) | 2,539 | 0.03 | 10,389 | 0.13 | ||||||||||||
| Other operating expenses (d) | (3,552 | ) | (0.04 | ) | (13,176 | ) | (0.17 | ) | ||||||||
| Depreciation and amortization (e) | (710 | ) | (0.01 | ) | (4,008 | ) | (0.05 | ) | ||||||||
| Interest expense (f) | (1,474 | ) | (0.02 | ) | (3,803 | ) | (0.04 | ) | ||||||||
| Other | (2,230 | ) | (0.03 | ) | (806 | ) | (0.01 | ) | ||||||||
| Income tax at effective rate (g) | (1,685 | ) | (0.02 | ) | (9,137 | ) | (0.11 | ) | ||||||||
| Dilution on earnings | n/a | (0.01 | ) | n/a | (0.04 | ) | ||||||||||
| Total Avista Utilities | 6,305 | 0.07 | 27,311 | 0.32
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