Emera reported 2022 third quarter financial results.
Highlights
• Quarterly adjusted EPS (1) increased $0.08 or 12% to $0.76 compared to $0.68 in Q3 2021. Quarterly reported EPS increased $0.90 to $0.63 in Q3 2022 compared to a net loss per common share of $(0.27) in Q3 2021 due to lower mark-to-market (“MTM”) losses in 2022.
• Year-to-date, adjusted EPS (1) increased $0.10 or 5% to $2.27 compared to $2.17 in Q3 2021. Year-to-date reported EPS increased by $1.02 to $1.75 from $0.73 in 2021 due to lower MTM losses in 2022.
• Adjusted EPS (1) contributions from regulated utilities increased 11% for the quarter and 12% year-to-date primarily driven by the impact of favourable weather and new rates at Tampa Electric, as well as from customer growth at both Tampa Electric and People’s Gas (“PGS”). Higher marketing and trading margin increased adjusted EPS1 by $0.05 for the quarter due to higher natural gas prices and volatility, which created profitable opportunities for Emera Energy Services (“EES”). These increases were partially offset by higher corporate costs, and a higher share count.
• On track to deploy $2.7 billion of capital investment in 2022, principally focused on decarbonization and reliability investments across the portfolio.
“In the face of the devastating storm impacts and extensive system outages resulting from Hurricanes Fiona and Ian, the restoration efforts of our teams in Nova Scotia and Tampa were remarkable,” said Scott Balfour, President and CEO of Emera Inc. “For the quarter, we continued to invest in meeting our customers needs for cleaner, reliable and cost-effective energy, and in so doing also delivered for our shareholders. Emera’s solid 5% growth in year-to-date earnings per share, and 12% growth in quarterly earnings per share year-over-year was principally driven by continued strong performance from our Florida utilities. Looking forward, continuing strong economic and customer growth in Florida is also supporting our updated $8-$9 billion capital plan and 7- 8% consolidated rate base growth over the 2023 – 2025 period, with approximately 75% of our capital plan expected to be invested in Tampa Electric and Peoples Gas.”
Q3 2022 Financial Results
Q3 2022 reported net income was $167 million, or $0.63 per common share, compared with a net loss of $70 million, or $(0.27) per common share, in Q3 2021. Reported net income included a $36 million after-tax MTM loss, primarily at EES, compared to a $245 million loss in Q3 2021.
Q3 2022 adjusted net income(1) was $203 million, or $0.76 per common share, compared with $175 million, or $0.68 per common share, in Q3 2021. The increase was primarily due to higher earnings contribution from Tampa Electric and EES and the impact of a weaker Canadian dollar (“CAD”). These were partially offset by increased corporate costs due to timing impacts of long-term compensation and related hedges, as well as higher interest expense due to higher interest rates.
Year-to-date Financial Results
Year-to-date reported net income was $462 million or $1.75 per common share, compared with a net income of $186 million or $0.73 per common share year-to-date in 2021. Year-to-date reported net income included a $132 million after-tax MTM loss primarily at EES, compared to $369 million in 2021 and $7 million of NSP Maritime Link Inc. (“NSPML”) unrecoverable costs.
Year-to-date adjusted net income(1) was $601 million or $2.27 per common share, compared with $555 million or $2.17 per common share year-to-date in 2021.
Growth in year-to-date adjusted net income was primarily due to higher earnings contributions from Tampa Electric, PGS and Seacoast and the impact of a weaker CAD. These were partially offset by increased corporate costs due to the timing of long-term compensation and related hedges, the net impact of corporate foreign exchange hedges, increased preferred stock dividends and increased interest expense due to higher interest rates.
The impact of the unrealized losses on foreign exchange hedges, partially offset by the weakening of the CAD decreased net income by $12 million in Q3 2022 and year-to-date 2022, compared to the same periods in 2021. The weakening of the CAD increased adjusted net income by $7 million in Q3 2022 and $14 million year-to-date 2022, compared to the same periods in 2021. The impacts of the weakening CAD include the current quarter and year-to-date impacts of corporate foreign exchange hedges in the Other segment.
