Algonquin Power & Utilities Cor Q4 FY2024 earnings call

• Leadership Transition: Chris Huskilson introduced incoming CEO Rod West, who has over 25 years of experience at Entergy. Darren Myers is departing as CFO, with Brian Chin stepping in as Interim CFO.
• Strategic Review Closure: Completed sale of Renewables business, uplifted Regulated utilities, and applied focus/discipline. Regulatory updates include approved rates in Missouri Water, Arkansas Water, Gas New Brunswick; settlement in Arizona water systems; progress in CalPECo, New Hampshire rate cases; delay in Empire Electric Missouri rate case due to tariff calculation issues and customer service/billing investigation by the commission.
• Transmission: Southwest Power Pool approved transmission projects in Empire Electric footprint, with over $700 million in cumulative capital spending over 5-7 years.

The company's continuing operations include the Regulated business, Hydro business, and an ownership stake in Atlantica (sold in Q4). Q4 consolidated adjusted EBITDA was $248.6 million, down 5.2% y-o-y. Regulated adjusted EBITDA in Q4 was $234.4 million, up 2.4% y-o-y. Full year consolidated adjusted EBITDA was approximately $1.04 billion, up 2.6% y-o-y. Regulated adjusted EBITDA for the full year was $940.2 million, up 4.2% y-o-y. The Renewables business was sold, with proceeds expected to reduce debt and other impacts.

• No 2025 guidance provided currently. Rod West plans to provide more transparency on outlook and Performance Acceleration Plan in ~90 days.
• Aim to accelerate operating efficiency, directionally lower capital spend in 2025.
• Focus on improving earned ROE to move closer to authorized 9.2% ROE and achieve targeted dividend payout ratio of 60%-70%.

• Missouri rate case delay due to late revision in tariff calculations and customer service/billing investigation related to IT platform implementation.
• Political and regulatory volatility in North America, which could impact the company's operations and regulatory outcomes.

Q: Sean Steuart asked about optimization of the utility platform and focus areas for improvement.

A: Chris Huskilson said it's about working on service costs, reducing overall overhead on utilities, and changing accountability structure with utility leaders/presidents in place.

Q: Nelson Ng asked about Hydro sales process and rate base adjustments.

A: Chris Huskilson said Hydro sales process will go to market within half year, not doing dilutive transactions. Darren Myers said IT platform was the main rate base adjustment prior to 2024 with nothing more significant to come.

Q: Robert Hope asked about 2025 outlook and Missouri customer solutions technology platform.

A: Brian Chin said need to give Rod time to assess the business. Sarah MacDonald said they're working on customer investigation, SAP implementation had billing issues but pace of improvement increased.

Q: Rupert Merer asked about Rod's focus in first 90 days and potential HQ move.

A: Rod West said focus on aligning people, putting productive capital to work; Brian Chin said premature to comment on HQ move but it's a self-help story.

Q: Benjamin Pham asked about realized ROE vs allowed.

A: Brian Chin said to look at segmented footnote in financial statements for mid-5s range of realized ROE.

Q: Mark Jarvi asked about Missouri rate case delay and interim rates.

A: Sarah MacDonald said billing investigation won't further delay rate case; no interim rates currently.