Southern Company (The) Series 2 Q3 FY2025 earnings call

• Southern Company performed well with adjusted earnings above estimates for Q3 2025 and expects to meet 2025 financial objectives.
• State-regulated electric and gas utilities serve over 9 million customers with reliable, affordable energy, and Georgia Power's rate plan freeze until 2029 (excluding storm costs) is a positive.
• Over 2 months, 4 contracts with large load customers in Georgia and Alabama totaling ~2 gigawatts of demand.
• Issued $4 billion of long-term debt in Q3, satisfying 2025 long-term debt needs for subsidiaries. Priced $1.8 billion of equity via ATM program, solidifying $7 billion of $9 billion equity need by 2029.
• Pipeline of large load data centers/manufacturers >50 gigawatts by mid-2030s. Georgia Power filed updated load forecast supporting 10 gigawatts capacity request. Alabama Power acquired Lindsay Hill gas generating facility; construction ongoing for ~2.5 gigawatts new generation in Georgia and Alabama; SNG expansion moving forward.

For the third quarter of 2025, adjusted EPS was $1.60 per share, $0.10 above the estimate and $0.17 higher than Q3 2024. Year-to-date, adjusted EPS was $3.76 compared to $3.56 for the same period in 2024. Revenue at state-regulated electrics grew partially due to customer growth and higher usage, adding $0.12 year-over-year. Year-to-date weather-normal retail electricity sales were 1.8% higher than the first 3 quarters of 2024. The commercial sector grew 3.5% in Q3 2025 on a weather-normal basis, residential sales were 2.7% higher, and all large industrial customer segments were up year-over-year. Economic development activity in service territories generated nearly 5,000 potential new jobs and ~$2.8 billion in capital investments.

• Q4 2025 adjusted EPS estimate is $0.54 per share, with full-year adjusted earnings at the top of 2025 guidance range ($4.30 per share).
• Expect to provide long-term plan update in February 2026, including 5-year capital investment, sales forecast, financing plans, and 2026/EPS guidance.
• Target 17% FFO to debt, with solid progress made in securing equity to meet $9 billion need by 2029.

Factors causing actual results to differ from forward-looking statements, including those in Form 10-K, 10-Qs and subsequent filings. Regulatory changes, weather variations, interest rate fluctuations, and execution risks related to capital projects and equity/funding plans.

Q: Carly Davenport asks about load growth outlook in Georgia, reception of new tariff structure, and GA regulatory environment.

A: David Poroch says customers understand the new structure, protections for customers are in place, and Georgia PSC processes are ongoing with a final determination expected by end of year.

Q: Julien Dumoulin-Smith asks about rebasing timeline and equity.

A: Christopher Womack says multiple factors like economy, interest rates, and large load contracts influence rebasing timeline, with clarity to be provided in February 2026 call; David Poroch talks about equity plans and $9 billion need.

Q: Shahriar Pourreza asks about Southern Power tolling agreements.

A: David Poroch says they'll renegotiate contracts toward end of expiring ones, with Southern Power winning 2 PPAs in Georgia RFP repriced nearly 3x current levels.

Q: Anthony Crowdell asks about 2027 guidance and Moody's negative outlook.

A: David Poroch discusses clarity in February call and path to 17% FFO to debt, emphasizing proactive and disciplined approach.

Q: Jeremy Tonet asks about nuclear development.

A: Christopher Womack talks about federal government actions supporting nuclear development, excited about steps taken by the administration.

Q: Andrew Weisel asks about demand projections.

A: David Poroch explains ramp-up timing and contract specifics, noting 7 gigawatts on 2029 column included in 2030 column and tailored contracts.

Q: David Arcaro asks about additional large load opportunities.

A: Christopher Womack says there are more upside opportunities for large load by 2029 with advanced discussions ongoing.

Q: Agnieszka Storozynski asks about gas-fired new build and nuclear.

A: David Poroch says they're evaluating gas-fired new build opportunities; Christopher Womack states Southern Company isn't ready to announce new nuclear plant yet, needing to mitigate risks first.

Q: Paul Fremont asks about contracted vs committed.

A: David Poroch explains contracted is signed agreement, committed is far along in negotiations with finalizing terms and conditions.

Q: Travis Miller asks about large load project sizes and next stage.

A: David Poroch talks about project diversity (100 megawatts to north of 1 gigawatt) and >50 gigawatts pipeline in various stages of evaluation