Southern Company (The) Series 2 Q1 FY2025 earnings call

• Chris Womack noted adjusted earnings results for the first quarter were above estimate with year-over-year growth across major businesses. The Southeast has economic resilience with robust development activity and a large load pipeline. State-regulated electric utilities have customer growth and attractive service territories. The grid's reliability is strong, especially appealing to data center customers. There's tariff policy uncertainty with an estimated 1%-3% potential cost increase range, but the company has mitigations like existing project contingencies, contractual provisions, etc. • Dan Tucker discussed adjusted EPS of $1.23 per share, up year-over-year. Weather and timing factors affected the 2Q EPS guide. Georgia Power's 2025 Integrated Resource Plan was filed with resolution expected in mid-July. There are regulatory processes for new energy resources in Georgia. Financing activities included $2.2B of long-term debt issued, $2.4B of junior subordinated notes, and an ATM program for $1B common stock. The dividend was increased to $2.96 annualized, marking the 24th consecutive annual increase.

No specific product segment financial performance with absolute terms and revenue contribution % provided in the transcript.

• Adjusted earnings for the first quarter were above estimate with year-over-year growth across major businesses. • 2Q EPS estimate is $0.85 per share. • Georgia Power's 2025 Integrated Resource Plan resolution expected in mid-July. • Potential reevaluation of the long-term EPS growth base as early as 2027. • Financing plan in place to address $4B five-year equity needs.

• Tariff policy uncertainty could result in potential cost increases of 1%-3%. • Regulatory processes and their impact on capital deployment. • Interest refinancing headwinds as a potential challenge.

Q: Carly Davenport asked about the 2Q EPS guide and Georgia Power load pipeline.

A: Dan Tucker said factors like weather and timing drove the 2Q EPS guide, and Chris Womack noted the Georgia load pipeline has 52 gigawatts in Georgia alone with contracted and committed pieces, and ongoing interest.

Q: Julien Dumoulin-Smith inquired about data center churn and reaching 17% FFO to debt.

A: Chris Womack said there's diversity of data center customers, and Dan Tucker discussed debt related to regulatory assets rolling off and capital plan impact on reaching 17% FFO to debt.

Q: Nick Campanella asked about rebates and Georgia Power rate case.

A: Dan Tucker said potential to be at the top of the range if incremental capital and data center momentum continue, and Chris Womack stated Georgia Power rate case filing is on track for early July.

Q: Jeremy Tonet asked about IRA and transferability.

A: Dan Tucker said transferability impact is minor but important, and Chris Womack said they engage with policymakers on tax credit value.

Q: Andrew Weisel asked about demand trends and large load pipeline.

A: Dan Tucker said no systemic trends seen, and the large load pipeline is over 50 gigawatts with focus on tangible trends.

Q: David Arcaro asked about data center rate structure and RFP.

A: Dan Tucker said rate structure framework is in development, and RFP process is confidential.

Q: Durgesh Chopra asked about RFP clarity.

A: Dan Tucker said Q2 call will provide incremental capital data.

Q: Unidentified Analyst asked about tariffs and GRC.

A: Dan Tucker said Southern Power is well-positioned with projects, and Chris Womack said GRC filing is early July with affordability in focus.

Q: Travis Miller asked about midstream constraints and dividend policy.

A: Dan Tucker said midstream is well-positioned with existing investments, and dividend policy is tied to financing needs and payout ratio.