XCEL ENERGY INC Q1 FY2025 earnings call

• Xcel Energy delivered earnings of $0.84 per share, invested $2.3 billion in infrastructure, and accelerated wildfire risk reduction efforts.
• Engaged with federal level on energy policies, advocating for tax credits, siting, and tariffs to address energy demand growth.
• Reached constructive settlements on wildfire mitigation plans in Colorado and Texas, with commission decisions expected by third quarter 2025.
• Made progress on data center contracts, with a goal to contract total base plan by fall 2025, and resolved 151 of 225 Smokehouse Creek claims.

Xcel Energy had earnings of $0.84 per share in the first quarter of 2025, compared to $0.88 per share in the first quarter of 2024. Electric and natural gas sales growth and regulatory outcomes increased earnings by $0.21 per share, and other items added $0.01 per share. Offsetting factors included higher O&M expenses ($0.11 per share), depreciation/amortization ($0.09 per share), and interest expense ($0.06 per share). First quarter weather and leap year adjusted electric sales increased 2%, with full year weather-adjusted electric sales expected to increase 3% in 2025.

• Reaffirmed EPS guidance of $3.75 to $3.85 for 2025.
• Expect full year weather-adjusted electric sales to increase 3%.
• Base capital plan remains intact with tariff impacts estimated at 2% to 3% of $45 billion plan, manageable with vendor mitigation.

• Tariff impacts on capital expenditures, particularly in battery storage, with an estimated 2% to 3% exposure on $45 billion plan.
• Wildfire liability risks, including new causation theories in the Marshall Fire case and potential for liability to increase beyond insurance coverage.

Q: Nicholas Campanella from Barclays asked about tax credits transferability and offsets to cash flow.

A: Bob Frenzel and Brian Van Abel discussed transferability alignment with tax credits and potential rate base/cash flow implications.

Q: Julien Dumoulin-Smith from Jefferies inquired about Colorado wildfire mitigation plan.

A: Brian Van Abel explained the unanimous settlement including concurrent recovery for O&M expenses and securitization for customer affordability.

Q: Carly Davenport from Goldman Sachs asked about tariff exposure and Smokehouse Creek liability.

A: Brian Van Abel discussed manageable tariff impacts and progress on Smokehouse Creek claims with settlements and dismissals of lawsuits.

Q: Durgesh Chopra from Evercore ISI asked about Marshall Fire.

A: Brian Van Abel and Bob Frenzel discussed new causation theories and indemnity agreements on poll attachments.

Q: Jeremy Tonet from J.P. Morgan asked about regulatory treatment of wildfire O&M expenses.

A: Brian Van Abel mentioned constructive regulatory outcomes expected for wildfire-related expenses.

Q: David Arcaro from Morgan Stanley inquired about tariff impact on renewables and data center pipeline.

A: Bob Frenzel and Brian Van Abel addressed tariff management and stable data center pipeline timing.

Q: Anthony Crowdell from Mizuho asked about coal plant retirements.

A: Bob Frenzel discussed planned retirements at Comanche and transition to renewables in Colorado.

Q: Ryan Levine from Citi asked about Texas wildfire legislation and tax credit transferability.

A: Brian Van Abel and Bob Frenzel talked about legislation implications and low probability of transferability changes impacting credit metrics.

Q: Travis Miller from Morningstar asked about Texas power generation and legislation.

A: Bob Frenzel and Brian Van Abel discussed de minimis contagion risk between ERCOT and SPP, and nuclear legislation support in Texas