WEC Energy Group, Inc. Q3 FY2025 earnings call

• Reaffirmed 2025 earnings guidance at $5.17 to $5.27 per share, assuming normal weather. - Introduced new 5-year capital plan with $36.5 billion investment from 2026-2030, a $8.5 billion increase from prior plan, expecting asset-based growth over 11% annually. - Economic growth driving demand: electric demand expected to grow 3.4 gigawatts between 2026-2030, with Microsoft's data center complex in Wisconsin and Vantage Data Centers' projects in Port Washington contributing to demand growth. - Regulatory updates: Wisconsin's BLC tariff under review by Public Service Commission, Illinois continuing pipe retirement program coordination with City of Chicago.

In the third quarter of 2025, WEC Energy Group's earnings were $0.83 per share, $0.01 over third quarter 2024 adjusted earnings. Utility operations earnings were $0.12 higher than third quarter 2024 adjusted earnings, with weather positively impacting by about $0.01, rate-based growth contributing $0.15, and timing of fuel expense, tax and other items adding $0.07, partially offset by higher depreciation and amortization expense ($0.06) and higher day-to-day O&M ($0.05). American Transmission Company's capital investment growth contributed an incremental $0.02 to Q3 earnings. Energy Infrastructure segment earnings increased $0.01 in the third quarter of 2025 from higher production tax credits. Earnings from the Corporate and Other segment increased $0.11, largely driven by tax timing and higher interest expense.

• Reaffirmed 2025 earnings guidance range of $5.17 to $5.27 per share. - Expect long-term projected earnings per share growth of 7% to 8% CAGR between 2026-2030. - Target payout ratio of 65% to 70% of earnings, expect dividend growth 6.5% to 7%. - 5-year capital plan includes $36.5B investment from 2026-2030, with cash from operations funding ~$21B, incremental debt ~$14B, and common equity ~$5B.

Q: Just on the updated growth outlook, with the inflection post 27, how does the CAGR shape in the back half of the plan?

A: Sure. Looking at the capital plan, in '26 seeing $6.5B to $7B, '27 ramping up to almost $7B and over $7.7B, with 2027 seeing 7%-8% annual growth, and '28-'30 closer to 8%.

Q: How should we interpret Microsoft expansion in the second phase as being incremental or not to the plan?

A: Work with Microsoft and other customers in Southeast Wisconsin, confident in growth in Southeast Wisconsin, and Microsoft called out growth in Southeastern Wisconsin in their conference call.

Q: With the large increase in capital plan and rate base growth, what's the appetite to recycle capital to replace common equity needs?

A: If an opportunity fits financial parameters and is good for investors, would look at it, but like performance of smaller companies and don't currently look to sell them.

Q: On data center announcements, what's in the plan versus yet to be included?

A: What's in the plan is 1.3 gigawatts at Vantage's Port Washington site and 2.1 gigawatts in Southeastern Wisconsin from customers like Microsoft, with additional potential growth in Port Washington and Southeastern Wisconsin.