Fortis Inc. Q1 FY2025 earnings call

• David Hutchens noted a strong start in 2025, with $1.4 billion invested in utility systems, EPS up $0.07 from the same quarter last year, and a constructive regulatory outcome in British Columbia on FortisBC's multi-year rate framework. The 2025 capital plan is on track with 27% invested, and the $26 billion five-year capital plan focuses on transmission, resource transition in Arizona, and infrastructure investment to support growth.
• Jocelyn Perry provided details on first quarter financial results, debt issuance, with Moody's and DBRS confirming credit ratings, and regulatory activity including FortisBC's multi-year rate framework decision, TEP planning to file a rate case in Arizona, and progress in Central Hudson's general rate application settlement negotiations.

For the quarter, net earnings were $499 million, or $1 per common share. U.S. electric and gas utilities provided a $0.02 increase in EPS. Central Hudson contributed $0.05 of the increase due to rate-based growth and conclusion of the 2024 general rate application. UNS Energy's EPS decreased $0.03 due to lower margins on wholesale sales and higher costs. ITC contributed a $0.01 increase reflecting rate-based growth, partially offset by higher stock-based compensation and finance costs. Western Canadian Utilities' EPS increased $0.01 largely driven by rate-based growth but tempered by timing of operating costs and lower ROE. The other electric segment's EPS increased $0.01 due to rate-based growth and higher electricity sales. The corporate and others segment's financial results were largely consistent with 2024, with higher stock-based compensation and finance costs offset by unrealized gains on derivative contracts. A higher average U.S. to Canadian dollar foreign exchange rate contributed a $0.03 EPS increase, while higher-weighted average shares lowered EPS by $0.01.

• Committed to annual dividend growth guidance of 4% to 6% through 2029.
• Rate base expected to increase by approximately $14 billion to $53 billion by 2029, supporting average annual rate-based growth of 6.5%.
• Monitoring government policies but doesn't expect significant near-term impacts on 2025 capital plan; tariffs' impacts would be recovered through regulatory mechanisms, mindful of customer affordability.

• Impact of tariffs on costs and potential long-term customer affordability issues.
• Regulatory changes and policy impacts that could affect capital plan execution.
• Supply chain availability and inflation risks that might impact capital plan costs.

Q: Richard Sunderland with JP Morgan asks about Iowa ROFA legislation procedural aspects.

A: Linda Apsey says legislative session timeline is uncertain, contingent on budget and other priorities, and it's difficult to predict exact timeline.