IDACORP, Inc. (NYSE: IDA) reported third quarter 2024 net income
attributable to IDACORP of $113.6 million, or $2.12 per diluted
share, compared with $105.3 million, or $2.07 per diluted share, in
the third quarter of 2023.
“We had a strong third quarter and benefited from customer
growth, rate changes, and weather conditions that contributed to
higher customer usage,” said IDACORP President and Chief Executive
Officer Lisa Grow. “As expected, higher depreciation and interest
expense partially offset those benefits during the quarter, as we
continued to acquire resources and build infrastructure to respond
to rapidly growing customer needs.”
“We are also excited to announce the results of our request for
proposal process for energy and capacity resource needs in 2026 and
2027. From that process, Idaho Power expects to procure additional
company-owned battery resources and its first-ever company-owned
wind power project in Wyoming, along with several power purchase
arrangements,” Grow added.
IDACORP is increasing the lower-end of its previously reported
full-year 2024 earnings guidance to the range of $5.35 to $5.45 per
diluted share. Idaho Power's expectation of additional tax credits
it will use to support earnings also improved to a range of $25 to
$35 million in 2024. The earnings guidance also assumes normal
weather conditions and normal power supply expenses through the
remainder of the year.
Summary of Financial Results
The following is a summary of net income attributable to IDACORP
and IDACORP's earnings per diluted share for the three and nine
months ended September 30, 2024 and 2023 (in thousands, except
earnings per share amounts):
Three months ended
September 30,
Nine months ended
September 30,
2024
2023
2024
2023
Net income attributable to IDACORP,
Inc.
$
113,605
$
105,264
$
251,298
$
229,936
Weighted average outstanding shares –
diluted
53,485
50,805
52,179
50,762
IDACORP, Inc. earnings per diluted
share
$
2.12
$
2.07
$
4.82
$
4.53
The table below provides a reconciliation of net income
attributable to IDACORP for the three and nine months ended
September 30, 2024, from the same periods in 2023 (items are in
millions and are before related income tax impact unless otherwise
noted):
Three months ended
Nine months ended
Net income attributable to IDACORP,
Inc. - September 30, 2023
$
105.3
$
229.9
Increase (decrease) in Idaho Power net
income:
Retail revenues per megawatt-hour (MWh),
net of associated power supply costs and power cost adjustment and
Idaho Fixed Cost Adjustment (FCA) mechanisms
19.3
44.0
Customer growth, net of associated power
supply costs and power cost adjustment mechanisms
7.4
17.1
Usage per retail customer, net of
associated power supply costs and power cost adjustment
mechanisms
3.1
(0.8
)
Transmission wheeling-related revenues,
net of Idaho-jurisdiction power cost adjustment (PCA) mechanism
impacts
0.5
(3.0
)
Other operations and maintenance (O&M)
expenses
(20.3
)
(47.9
)
Depreciation expense
(5.6
)
(21.8
)
Other changes in operating revenues and
expenses, net
3.3
21.8
Increase in Idaho Power operating
income
7.7
9.4
Non-operating expense, net
2.4
0.2
Additional accumulated deferred investment
tax credits (ADITC) amortization
2.5
15.0
Income tax expense, excluding additional
ADITC amortization
(4.5
)
(4.6
)
Total increase in Idaho Power net
income
8.1
20.0
Other IDACORP changes (net of tax)
0.2
1.4
Net income attributable to IDACORP,
Inc. - September 30, 2024
$
113.6
$
251.3
Net Income - Third Quarter 2024
IDACORP's net income increased $8.3 million for the third
quarter of 2024 compared with the third quarter of 2023, due
primarily to higher net income at Idaho Power.
The net increase in retail revenues per MWh, net of associated
power supply costs and power cost adjustment and FCA mechanisms,
increased operating income by $19.3 million in the third quarter of
2024 compared with the third quarter of 2023. This benefit was due
primarily to an overall increase in Idaho base rates, effective
January 1, 2024, per the terms of the settlement stipulation for
Idaho Power's 2023 Idaho general rate case (2023 Settlement
Stipulation).
At Idaho Power, customer growth increased operating income by
$7.4 million in the third quarter of 2024 compared with the third
quarter of 2023, as the number of Idaho Power customers grew by
approximately 16,500, or 2.6 percent, during the twelve months
ended September 30, 2024. Usage per retail customer increased
operating income by $3.1 million in the third quarter of 2024
compared with the third quarter of 2023. While there was an
increase in usage per customer for most retail customer classes,
usage per residential and irrigation customers were the primary
contributors. Higher temperatures and lower precipitation compared
with the third quarter of 2023 led residential customers to use
more energy for cooling purposes and irrigation customers to run
irrigation pumps more frequently.
Total other O&M expenses in the third quarter of 2024 were
$20.3 million higher than the third quarter of 2023, partially
related to approximately $4 million of increased pension-related
expenses and an approximate $6 million increase in wildfire
mitigation program and related insurance expenses. Both of these
increases in expenses were partially offset by increases in retail
revenues, as more costs are now recovered in base rates pursuant to
the 2023 Settlement Stipulation. However, revenues related to these
increased costs are not collected at the same rate that the
expenses are incurred in the interim periods throughout the year
due to the impact of volume-based rates and associated revenues.
Inflationary pressures on labor-related costs also contributed to
the increase in other O&M expenses. These increases in other
O&M expenses were partially offset by a $2.9 million deferral
of other O&M expenses related to the conversion from coal to
natural gas for two units at the Jim Bridger power plant.
Depreciation expense increased $5.6 million in the third quarter
of 2024 compared with the third quarter of 2023 due primarily to an
increase in plant-in-service.
Other changes in operating revenues and expenses, net, increased
operating income by $3.3 million in the third quarter of 2024
compared with the third quarter of 2023, due primarily to a
decrease in net power supply expenses that were not deferred for
future recovery in rates through Idaho Power's power cost
adjustment mechanisms, which increased other changes in operating
revenues and expenses, net, compared with the same period in 2023.
More moderate and less volatile wholesale natural gas and power
market prices in the western United States and increased wholesale
energy sales decreased Idaho Power's net power supply expenses in
the third quarter of 2024 compared with the third quarter of
2023.
Non-operating expense, net, decreased $2.4 million in the third
quarter of 2024 compared with the third quarter of 2023. Allowance
for funds used during construction (AFUDC) increased in the third
quarter of 2024 compared with the third quarter of 2023, as the
average construction work in progress balance was higher, and
interest income increased due to higher average cash balances and
interest rates. These increases were partially offset by an
increase in interest expense on long-term debt in the third quarter
of 2024 compared with the third quarter of 2023, due primarily to
an increase in long-term debt balances. Also offsetting the
increases, Idaho Power's earnings from its investment in Bridger
Coal Company (BCC) decreased $2.2 million in the third quarter of
2024 compared with the third quarter of 2023, due to a decrease in
the amount included and recovered in base rates pursuant to the
2023 Settlement Stipulation.
The increase in income tax expense was principally the result of
higher income before income taxes, partially offset by an increase
in additional ADITC amortization. Based on Idaho Power's current
expectations of full-year 2024 results, Idaho Power recorded $2.5
million of additional ADITC amortization under its Idaho regulatory
settlement stipulation during the third quarter of 2024, but
recorded no additional ADITC amortization during the same period in
2023.
Net Income - Year-To-Date 2024
IDACORP's net income increased $21.4 million for the first nine
months of 2024 compared with the first nine months of 2023, due
primarily to higher net income at Idaho Power.
The net increase in retail revenues per MWh, net of associated
power supply costs and power cost adjustment and FCA mechanisms,
increased operating income by $44 million in the first nine months
of 2024 compared with the first nine months of 2023. This benefit
was due primarily to an overall increase in Idaho base rates,
effective January 1, 2024, per the terms of the 2023 Settlement
Stipulation.
At Idaho Power, customer growth increased operating income by
$17.1 million in the first nine months of 2024 compared with the
first nine months of 2023. The benefit from customer growth was
partially offset by a decrease in usage per retail customer of $0.8
million, as higher usage per customer in the second and third
quarters of 2024 was more than offset by lower usage per customer
in the first quarter of 2024. Overall, usage per customer was
relatively flat for most customer classes.
Transmission wheeling-related revenues, net of PCA impacts,
decreased $3.0 million during the first nine months of 2024
compared with the first nine months of 2023. Effective January 1,
2024, financial settlement of transmission line losses are subject
to the PCA mechanism, as approved in the 2023 Settlement
Stipulation, resulting in a smaller contribution of those revenues
to net income compared with the first nine months of 2023 when the
financial settlement of transmission line losses was not subject to
the PCA mechanism.
Total other O&M expenses in the first nine months of 2024
were $47.9 million higher than the first nine months of 2023,
partially related to approximately $13 million of increased
pension-related expenses and an approximate $22 million increase in
wildfire mitigation program and related insurance expenses. Both of
these increases in expenses were partially offset by increases in
retail revenues, as more costs are now recovered in base rates
pursuant to the 2023 Settlement Stipulation; however, revenues
related to these increased costs are not collected at the same rate
that the expenses are incurred in the interim periods throughout
the year. On a full-year basis for 2024, Idaho Power expects other
O&M expenses related to its employee pension plans and its
wildfire mitigation program and related insurance to increase
approximately $18 million and $30 million, respectively, compared
with 2023. Inflationary pressures on labor-related costs also
contributed to the increase in other O&M expenses. These
increases were partially offset by a $9.1 million increase in
deferral of other O&M expenses related to the conversion from
coal to natural gas for two units at the Jim Bridger power
plant.
Depreciation expense increased $21.8 million for the first nine
months of 2024 compared with the first nine months of 2023 due
primarily to an increase in plant-in-service.
Other changes in operating revenues and expenses, net, increased
operating income by $21.8 million in the first nine months of 2024
compared with the first nine months of 2023, due partially to a
decrease in net power supply expenses that were not deferred for
future recovery in rates through Idaho Power's power cost
adjustment mechanisms, which increased other changes in operating
revenues and expenses, net, compared with the same period in 2023.
More moderate wholesale natural gas and power market prices in the
western United States and increased wholesale energy sales
decreased Idaho Power's net power supply expenses in the first nine
months of 2024 compared with the first nine months of 2023. The
change was also partially due to the timing of recording and
adjusting regulatory accruals and deferrals.
Non-operating expense, net, decreased $0.2 million in the first
nine months of 2024 compared with the first nine months of 2023.
AFUDC increased in the first nine months of 2024 compared with the
first nine months of 2023, as the average construction work in
progress balance was higher. In addition, interest income increased
due to higher average cash balances and interest rates compared
with the same period in 2023. These increases were partially offset
by an increase in interest expense on long-term debt in the first
nine months of 2024 compared with the first nine months of 2023,
due primarily to an increase in long-term debt balances. Also
offsetting the increases, Idaho Power's earnings from its
investment in BCC decreased $5.5 million in the first nine months
of 2024 compared with the first nine months of 2023, due to a
decrease in the amount included and recovered in base rates
pursuant to the 2023 Settlement Stipulation.
The increase in income tax expense was primarily the result of
higher income before income taxes, partially offset by an increase
in additional ADITC amortization. Based on Idaho Power's current
expectations of full-year 2024 results, Idaho Power recorded $22.5
million of additional ADITC amortization under its Idaho regulatory
settlement stipulation during the first nine months of 2024, but
recorded $7.5 million of additional ADITC amortization during the
same period in 2023.
2024 Annual Earnings Guidance and Key Operating and Financial
Metrics
IDACORP is increasing the lower-end of its earnings guidance
estimate for 2024 and its expectation for the use of additional
ADITCs also improved. The 2024 guidance incorporates all of the key
operating and financial assumptions listed in the table that
follows (in millions, except per share amounts):
Current(1)
Previous(2)
IDACORP Earnings Guidance (per diluted
share)
$ 5.35 – $ 5.45
$ 5.30 – $ 5.45
Idaho Power Additional ADITCs
$ 25 – $ 35
$ 35 – $ 50
Idaho Power O&M Expense(3)
No change
$ 440 – $ 450
Idaho Power Capital Expenditures,
Excluding AFUDC
No change
$ 925 – $ 975
Idaho Power Hydropower Generation
(MWh)
7.0 – 7.5
7.0 – 8.0
(1)
As of October 31, 2024. Assumes normal
weather conditions and normal power supply expenses through the
remainder of 2024.
(2)
As of August 1, 2024, the date of filing
IDACORP's and Idaho Power's Quarterly Report on Form 10-Q for the
quarter ended June 30, 2024.
(3)
Approximately $48 million of the expected
increase in other O&M expense, compared with 2023, relates to
pension and wildfire mitigation plan expenses, approved for
recovery in the 2023 Settlement Stipulation effective January 1,
2024. The increased other O&M expense is expected to be offset
by collection through tariff-based retail revenues.
More detailed financial and operational information is provided
in IDACORP’s Quarterly Report on Form 10-Q filed today with the
U.S. Securities and Exchange Commission, which is also available
for review on IDACORP’s website at www.idacorpinc.com.
Web Cast / Conference Call
IDACORP will hold an analyst conference call today at 2:30 p.m.
Mountain Time (4:30 p.m. Eastern Time). All parties interested in
listening may do so through a live webcast on IDACORP's website
(www.idacorpinc.com), or by calling (855) 761-5600 for listen-only
mode. The passcode for the call is 9290150. The conference call
logistics are also posted on IDACORP's website. Slides will be
included during the conference call. To access the slide deck,
please visit www.idacorpinc.com/investor-relations. A replay of the
conference call will be available on the company's website for 12
months and will be available shortly after the call.
Background Information
IDACORP, Inc. (NYSE: IDA), Boise, Idaho-based and formed in
1998, is a holding company comprised of Idaho Power, a regulated
electric utility; IDACORP Financial, an investor in affordable
housing and other real estate tax credit investments; and Ida-West
Energy, an operator of small hydroelectric generation projects that
satisfy the requirements of the Public Utility Regulatory Policies
Act of 1978. Idaho Power, headquartered in vibrant and fast-growing
Boise, Idaho, has been a locally operated energy company since
1916. Today, it serves a 24,000-square-mile service area in Idaho
and Oregon. Idaho Power’s goal to provide 100% clean energy by 2045
builds on its long history as a clean-energy leader that provides
reliable service at affordable prices. With 17 low-cost hydropower
projects at the core of its diverse energy mix, Idaho Power’s
residential, business, and agricultural customers pay among the
nation's lowest prices for electricity. Its 2,100 employees proudly
serve more than 640,000 customers with a culture of safety first,
integrity always, and respect for all. To learn more about IDACORP
or Idaho Power, visit www.idacorpinc.com or www.idahopower.com.
Forward-Looking Statements
In addition to the historical information contained in this
press release, this press release contains (and oral communications
made by IDACORP, Inc. (IDACORP) and Idaho Power Company (Idaho
Power) may contain) statements that relate to future events and
expectations, such as statements regarding projected or future
financial performance, power generation, cash flows, capital
expenditures, regulatory filings, dividends, capital structure or
ratios, load forecasts, strategic goals, challenges, objectives,
and plans for future operations. Such statements constitute
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. Any statements that
express, or involve discussions as to, expectations, beliefs,
plans, objectives, assumptions, or future events or performance,
often, but not always, through the use of words or phrases such as
"anticipates," "believes," "could," "estimates," "expects,"
"intends," "potential," "plans," "predicts," "preliminary,"
"projects," "targets," "may," "may result," or similar expressions,
are not statements of historical facts and may be forward-looking.
Forward-looking statements are not guarantees of future
performance, involve estimates, assumptions, risks, and
uncertainties, and may differ materially from actual results,
performance, or outcomes. In addition to any assumptions and other
factors and matters referred to specifically in connection with
such forward-looking statements, factors that could cause actual
results or outcomes to differ materially from those contained in
forward-looking statements include those factors set forth in this
press release, IDACORP's and Idaho Power's most recent Annual
Report on Form 10-K, particularly Part I, Item 1A - "Risk Factors"
and Part II, Item 7 - "Management’s Discussion and Analysis of
Financial Condition and Results of Operations" of that report,
subsequent reports filed by IDACORP and Idaho Power with the U.S.
Securities and Exchange Commission (SEC), and the following
important factors: (a) decisions or actions by the Idaho and Oregon
public utilities commissions and the Federal Energy Regulatory
Commission that impact Idaho Power's ability to recover costs and
earn a return on investment; (b) changes to or the elimination of
Idaho Power's regulatory cost recovery mechanisms; (c) expenses and
risks associated with capital expenditures for, and the permitting
and construction of, utility infrastructure projects that Idaho
Power may be unable to complete, are delayed, or that may not be
deemed prudent by regulators for cost recovery or return on
investment; (d) expenses and risks associated with supplier and
contractor delays and failure to satisfy project quality and
performance standards on utility infrastructure projects, and the
potential impacts of those delays and failures on Idaho Power's
ability to serve customers; (e) the rapid addition of new
industrial and commercial customer load and the volatility of such
new load demand, resulting in increased risks and costs of power
demand potentially exceeding supply and of purchasing energy and
capacity in the market or acquiring or constructing additional
capacity and energy resources, and the potential financial impacts
of industrial customers not meeting forecasted power usage ramp
rates or amounts; (f) impacts of economic conditions, including an
inflationary or recessionary environment and increased interest
rates, on items such as operations and capital investments, supply
costs and delivery delays, supply scarcity and shortages,
population growth or decline in Idaho Power's service area, changes
in customer demand for electricity, revenue from sales of excess
power, credit quality of counterparties and suppliers and their
ability to meet financial and operational commitments and on the
timing and extent of their power usage, and collection of
receivables; (g) changes in residential, commercial, and industrial
growth and demographic patterns within Idaho Power's service area,
and the associated impacts on loads and load growth; (h) employee
workforce factors, including the operational and financial costs of
unionization or the attempt to unionize all or part of the
companies' workforce, the cost and ability to attract and retain
skilled workers and third-party contractors and suppliers, the cost
of living and the related impact on recruiting employees, and the
ability to adjust to fluctuations in labor costs; (i) changes in,
failure to comply with, and costs of compliance with laws,
regulations, policies, orders, and licenses, which may result in
penalties and fines, increase compliance and operational costs, and
impact recovery associated with increased costs through rates; (j)
abnormal or severe weather conditions (including conditions and
events associated with climate change), wildfires, droughts,
earthquakes, and other natural phenomena and natural disasters,
which affect customer sales, hydropower generation, repair costs,
service interruptions, public safety power shutoffs and
de-energization, liability for damage caused by utility property,
and the availability and cost of fuel for generation plants or
purchased power to serve customers; (k) advancement and adoption of
self-generation, energy storage, energy efficiency, alternative
energy sources, and other technologies that may reduce Idaho
Power's sale or delivery of electric power or introduce operational
vulnerabilities to the power grid; (l) variable hydrological
conditions and over-appropriation of surface and groundwater in the
Snake River Basin, which may impact the amount of power generated
by Idaho Power's hydropower facilities and power supply costs; (m)
ability to acquire equipment, materials, fuel, power, and
transmission capacity on reasonable terms and prices, particularly
in the event of unanticipated or abnormally high resource demands,
price volatility, lack of physical availability, transportation
constraints, outages due to maintenance or repairs to generation or
transmission facilities, disruptions in the supply chain, or
reduced credit quality or lack of counterparty and supplier credit;
(n) disruptions or outages of Idaho Power's generation or
transmission systems or of any interconnected transmission systems,
which can result in liability for Idaho Power, increased power
supply costs and repair expenses, and reduced revenues; (o)
accidents, electrical contacts, fires (either affecting or caused
by Idaho Power facilities or infrastructure), explosions,
infrastructure failures, general system damage or dysfunction, and
other unplanned events that may occur while operating and
maintaining assets, which can cause unplanned outages; reduce
generating output; damage company assets, operations, or
reputation; subject Idaho Power to third-party claims for property
damage, personal injury, or loss of life; or result in the
imposition of fines and penalties; (p) acts or threats of
terrorism, acts of war, social unrest, cyber or physical security
attacks, and other malicious acts of individuals or groups seeking
to disrupt Idaho Power's operations or the electric power grid or
compromise data, or the disruption or damage to the companies’
business, operations, or reputation resulting from such events; (q)
increased costs associated with purchases of power mandated by the
Public Utility Regulatory Policies Act of 1978 from renewable
energy sources; (r) Idaho Power's concentration in one industry and
one region, and the resulting exposure to regional economic
conditions and regional legislation and regulation; (s) unaligned
goals and positions with co-owners of Idaho Power’s generation and
transmission assets; (t) changes in tax laws or related regulations
or interpretations of applicable laws or regulations by federal,
state, or local taxing jurisdictions, and the availability of tax
credits; (u) inability to timely obtain and the cost of obtaining
and complying with required governmental permits and approvals,
licenses, rights-of-way, and siting for transmission and generation
projects and hydropower facilities; (v) ability to obtain debt and
equity financing or refinance existing debt when necessary and on
satisfactory terms, which can be affected by factors such as credit
ratings, reputational harm, volatility or disruptions in the
financial markets, interest rates, decisions by the Idaho, Oregon,
or Wyoming public utility commissions, and the companies' past or
projected financial performance; (w) ability to enter into
financial and physical commodity hedges with creditworthy
counterparties to manage price and commodity risk for fuel, power,
and transmission, and the failure of any such risk management and
hedging strategies to work as intended, and the potential losses
the companies may incur on those hedges, which can be affected by
factors such as the volume of hedging transactions and degree of
price volatility; (x) changes in actuarial assumptions, changes in
interest rates, increasing health care costs, and the actual and
projected return on plan assets for pension and other
postretirement plans, which can affect future pension and other
postretirement plan funding obligations, costs, and liabilities and
the companies' cash flows; (y) remediation costs associated with
planned cessation of coal-fired operations at Idaho Power's
co-owned coal plants and conversion of the plants to natural gas;
(z) ability to continue to pay dividends and achieve target
dividend payout ratios based on financial performance and capital
requirements, and in light of credit rating considerations,
contractual covenants and restrictions, and regulatory limitations;
(aa) adoption of or changes in accounting policies and principles,
changes in accounting estimates, and new SEC or New York Stock
Exchange requirements or new interpretations of existing
requirements; and (ab) changing market dynamics due to the
emergence of day ahead or other energy and transmission markets in
the western United States. Any forward-looking statement speaks
only as of the date on which such statement is made. New factors
emerge from time to time and it is not possible for the companies
to predict all such factors, nor can they assess the impact of any
such factor on the business or the extent to which any factor, or
combination of factors, may cause results to differ materially from
those contained in any forward-looking statement. IDACORP and Idaho
Power disclaim any obligation to update publicly any
forward-looking information, whether in response to new
information, future events, or otherwise, except as required by
applicable law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20241031193254/en/
Investor and Analyst Contact Amy I.
Shaw VP of Finance, Compliance & Risk Phone: (208) 388-5611
AShaw@idahopower.com
Media Contact Jordan Rodriguez
Corporate Communications Phone: (208) 388-2460
JRodriguez@idahopower.com
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