NextEra Energy Reports 4th Quarter & Full-Year 2022 Financial Results

Source: www.gulfoilandgas.com 1/25/2023, Location: North America

• NextEra Energy delivers strong full-year 2022 financial and operational results
• FPL continues to focus on delivering an outstanding value proposition of low bills, high reliability, outstanding customer service and clean energy solutions for its customers
• NextEra Energy Resources has a record year of renewables origination, signing more than 8,000 megawatts of new projects, and extends its overall development expectations through 2026
• Driven by long-term growth visibility for low-cost renewables, NextEra Energy extends long-term growth outlook by an additional year, through 2026

NextEra Energy, Inc. reported 2022 fourth-quarter net income attributable to NextEra Energy on a GAAP basis of $1,522 million, or $0.76 per share, compared to $1,204 million, or $0.61 per share, for the fourth quarter of 2021. On an adjusted basis, NextEra Energy's 2022 fourth-quarter earnings were $1,011 million, or $0.51 per share, compared to $814 million, or $0.41 per share, in the fourth quarter of 2021.

For the full year 2022, NextEra Energy reported net income attributable to NextEra Energy on a GAAP basis of $4.147 billion, or $2.10 per share, compared to $3.573 billion, or $1.81 per share, in 2021. On an adjusted basis, NextEra Energy's full-year 2022 earnings were $5.742 billion, or $2.90 per share, compared to $5.021 billion, or $2.55 per share, in 2021, which represents year-over-year growth in adjusted earnings per share of approximately 13.7%.

Adjusted earnings for these periods exclude the effects of non-qualifying hedges; NextEra Energy Partners, LP net investment gains; differential membership interests-related; change in unrealized gains and losses on equity securities held in NextEra Energy Resources' nuclear decommissioning funds and other than temporary impairments (OTTI); and impairment charges.

NextEra Energy's management uses adjusted earnings, which is a non-GAAP financial measure, internally for financial planning, analysis of performance, reporting of results to the board of directors and as an input in determining performance-based compensation under the company's employee incentive compensation plans. NextEra Energy also uses earnings expressed in this fashion when communicating its financial results and earnings outlook to analysts and investors. NextEra Energy's management believes that adjusted earnings provide a more meaningful representation of NextEra Energy's fundamental earnings power. A reconciliation of historical adjusted earnings to net income (loss) attributable to NextEra Energy, which is the most directly comparable GAAP measure, is included in the attachments to this news release.

Florida Power & Light Company completed the regulatory integration of Gulf Power Company under its 2021 base rate settlement agreement and began serving customers under unified rates on Jan. 1, 2022. As a result, Gulf Power is no longer a separate reporting segment within Florida Power & Light and NextEra Energy. For 2022 and beyond, FPL has one reporting segment and, therefore, 2021 financial results and other operational metrics have been restated for comparative purposes.

"NextEra Energy was successful in executing our 2022 initiatives, ending the year with excellent financial and operational results," said John Ketchum, chairman, president and chief executive officer of NextEra Energy. "We grew adjusted earnings per share by nearly 14% from 2021 and outperformed the S&P 500 index by nearly 10%. In the midst of a challenging macro environment, we invested more than $19 billion in American energy infrastructure and commissioned roughly 5,000 megawatts of new renewables and storage. This terrific performance in a year of significant supply chain disruption, inflationary pressures and higher interest rates is a testament to the strength and resiliency of our team and our competitive advantages, and I am extremely pleased with what we accomplished in 2022.

"At FPL, thanks to the hard work and dedication of our team, combined with our valuable hardening and smart grid investments, we quickly restored power to customers after hurricanes Ian and Nicole last fall.

We also used our strong balance sheet to provide bill relief for FPL customers during a year of high inflation and high natural gas prices. NextEra Energy Resources had its best-ever year of renewables and storage origination, adding more than 8,000 megawatts to its backlog. Based on tremendous demand and continued cost advantages of renewables, today we are extending NextEra Energy Resources' development expectations through 2026. We now believe that between 2023 and 2026 we will place into service approximately 32,700 megawatts to 41,800 megawatts of new renewables and storage.

"With the passage of the Inflation Reduction Act, we are better positioned than ever before to offer lowcost renewables and other clean energy solutions to customers into the latter half of the decade and beyond. Driven by low-cost renewables and significant growth opportunities at both FPL and NextEra Energy Resources, today we are announcing that we are extending our adjusted earnings per share growth expectations by an additional year, through 2026. For 2025 and 2026, we expect to grow 6% to 8%, off the 2024 adjusted earnings per share range, translating to a range of $3.45 to $3.70 for 2025 and $3.63 to $4.00 for 2026. We will be disappointed if we are not able to deliver financial results at or near the top end of our adjusted earnings per share expectations ranges in each of 2023, 2024, 2025 and 2026, while at the same time maintaining our strong balance sheet and credit ratings."

FPL
FPL reported fourth-quarter 2022 net income of $763 million, or $0.38 per share, compared to $620 million, or $0.31 per share, for the prior-year comparable quarter. For the full year 2022, FPL reported net income of $3.701 billion, or $1.87 per share, compared to $3.206 billion, or $1.63 per share, in 2021.

As America's largest electric utility, FPL sells more power than any other utility, providing clean, affordable, reliable electricity to approximately 5.8 million customer accounts, or more than 12 million people across Florida.

FPL's full-year growth was primarily driven by continued investment in the business. FPL's capital expenditures were approximately $3.1 billion for the fourth quarter of 2022, bringing its full-year capital investments to a total of roughly $9.2 billion. Regulatory capital employed increased by approximately 11.4% for 2022. During the fourth quarter of 2022, FPL's average number of customers increased by nearly 74,000 from the prior-year comparable quarter.

During 2022, FPL successfully executed on its strategic initiatives while delivering on its outstanding customer value proposition. Despite record inflationary pressures, FPL further reduced its already best-inclass non-fuel operations and maintenance costs versus 2021 while deploying additional low-cost solar and providing exceptional reliability. In 2022, FPL placed approximately 450 megawatts (MW) of costeffective solar in service. Beyond solar, construction on FPL's green hydrogen pilot at Okeechobee Clean Energy Center remains on schedule as it continues to advance toward its projected commercial operation date later this year. FPL also was recognized for the seventh time in eight years as being the most reliable electric utility in the nation.

Earlier this week, FPL filed with the Florida Public Service Commission its proposed plan to recover approximately $2.1 billion of incremental fuel costs incurred in 2022. Under the proposed plan, FPL would utilize its strong balance sheet to spread these unrecovered 2022 fuel costs over a 21-month period, beginning in April 2023. Additionally, FPL's proposed plan would further benefit customers by offsetting the 2022 fuel cost recovery by approximately $1 billion this year based on the recent drop in projected natural gas prices, compared to FPL's original 2023 projections made in the third quarter of 2022.

Separately, FPL is also seeking recovery of approximately $1.3 billion of storm costs incurred in 2022.

Under FPL's proposal, the storm costs would be recovered over a 12-month period, starting in April 2023, to reduce the potential customer bill impacts that could result from the simultaneous recovery of charges related to future storms. Taking both proposals together, FPL anticipates that its typical 1,000-kilowatthour residential customer bills as of April 2023 will remain well below the projected national average and the projected average for Florida investor-owned utilities.

NextEra Energy Resources
NextEra Energy Resources, the competitive clean energy business of NextEra Energy, reported fourthquarter 2022 net income attributable to NextEra Energy on a GAAP basis of $996 million, or $0.50 per share, compared to $851 million, or $0.43 per share, in the prior-year quarter. On an adjusted basis, NextEra Energy Resources' earnings for the fourth quarter of 2022 were $402 million, or $0.20 per share, compared to $414 million, or $0.21 per share, for the fourth quarter of 2021.

For the full year 2022, NextEra Energy Resources reported net income attributable to NextEra Energy on a GAAP basis of $285 million, or $0.14 per share, compared to $599 million, or $0.30 per share, in 2021.

On an adjusted basis, NextEra Energy Resources' earnings for the full year 2022 were $2.441 billion, or $1.23 per share, compared to $2.206 billion, or $1.12 per share, for the full year 2021.

In 2022, NextEra Energy Resources delivered a record year of renewables and storage origination, adding approximately 8,030 MW to its backlog. Since the third-quarter 2022 financial results call in October, NextEra Energy Resources has originated approximately 1,700 MW of renewables and storage projects, including approximately 300 MW of wind, 730 MW of solar and 670 MW of battery storage.

NextEra Energy Resources' renewables backlog now stands at approximately 19 gigawatts, after placing roughly 4,600 MW into service in 2022.

Corporate and Other
In the fourth quarter of 2022 on a GAAP basis, Corporate and Other results increased $0.01 per share, compared to the prior-year quarter. On an adjusted basis, Corporate and Other results for the fourth quarter of 2022 increased $0.04 per share, compared to the prior-year quarter. For the full year 2022, Corporate and Other results increased $0.21 per share on a GAAP basis, compared to 2021. On an adjusted basis, Corporate and Other results for the full year 2022 were roughly flat, compared to 2021.

Outlook
Driven by low-cost renewables and significant growth opportunities at both FPL and NextEra Energy Resources, NextEra Energy today reaffirmed its long-term financial expectations for 2023 through 2025 and introduced its expectations for 2026. For 2023 and 2024, NextEra Energy continues to expect adjusted earnings per share to be in the ranges of $2.98 to $3.13 and $3.23 to $3.43, respectively. For 2025 and 2026, NextEra Energy expects to grow 6% to 8%, off the 2024 adjusted earnings per share range. This translates to a range of $3.45 to $3.70 for 2025 and $3.63 to $4.00 for 2026. NextEra Energy also continues to expect to grow its dividends per share at a roughly 10% rate per year through at least 2024, off a 2022 base.

NextEra Energy's adjusted earnings expectations exclude the cumulative effect of adopting new accounting standards; the effects of non-qualifying hedges and unrealized gains and losses on equity securities held in NextEra Energy Resources, LLC's nuclear decommissioning funds and other than temporary impairments, none of which can be determined at this time. Adjusted earnings expectations also exclude the effects of NextEra Energy Partners, LP net investment gains, differential membership interests-related and impairment charges related to NextEra Energy's investment in Mountain Valley Pipeline, LLC. In addition, adjusted earnings expectations assume, among other things, normal weather and operating conditions; positive macroeconomic conditions in the U.S. and Florida; supportive commodity markets; current forward curves; public policy support for wind and solar development and construction; market demand and transmission expansion to support wind and solar development; market demand for pipeline capacity; access to capital at reasonable cost and terms; divestitures to NextEra Energy Partners, LP; no adverse litigation decisions; and no changes to governmental policies or incentives. Please see the accompanying cautionary statements for a list of the risk factors that may affect future results.


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