Avista Corp. Reports Financial Results for the Third Quarter of 2024
Avista Corp. (NYSE: AVA) reported Q3 2024 net income of $18.5 million ($0.23 per diluted share), up from $14.7 million ($0.19 per share) in Q3 2023. Year-to-date net income reached $112.8 million ($1.44 per share), compared to $87 million ($1.14 per share) in 2023. The company lowered its 2024 consolidated earnings guidance to $2.26-$2.46 per diluted share due to lower-than-expected valuations in private equity markets. Avista Utilities expects to be at the low end of guidance range due to higher power supply, medical, and bad debt costs. The company plans to invest approximately $515 million in capital expenditures at Avista Utilities and $21 million at AEL&P for 2024.
Avista Corp. (NYSE: AVA) ha riportato un reddito netto nel terzo trimestre del 2024 di 18,5 milioni di dollari (0,23 dollari per azione diluita), in aumento rispetto ai 14,7 milioni di dollari (0,19 dollari per azione) nel terzo trimestre del 2023. Il reddito netto da inizio anno ha raggiunto 112,8 milioni di dollari (1,44 dollari per azione), rispetto ai 87 milioni di dollari (1,14 dollari per azione) del 2023. L'azienda ha abbassato le previsioni consolidate per gli utili del 2024 a un intervallo di 2,26-2,46 dollari per azione diluita a causa di valutazioni inferiori alle attese nei mercati del capitale privato. Avista Utilities prevede di restare al limite inferiore dell'intervallo di guida a causa di costi più elevati per l'approvvigionamento di energia, medico e per debitorie in sofferenza. L'azienda ha in programma di investire circa 515 milioni di dollari in spese in conto capitale per Avista Utilities e 21 milioni di dollari per AEL&P nel 2024.
Avista Corp. (NYSE: AVA) reportó un ingreso neto de 18,5 millones de dólares (0,23 dólares por acción diluida) en el tercer trimestre de 2024, un aumento en comparación con los 14,7 millones de dólares (0,19 dólares por acción) en el tercer trimestre de 2023. El ingreso neto acumulado hasta la fecha alcanzó 112,8 millones de dólares (1,44 dólares por acción), en comparación con 87 millones de dólares (1,14 dólares por acción) en 2023. La compañía redujo su guía de ganancias consolidadas para 2024 a un rango de 2,26-2,46 dólares por acción diluida debido a valoraciones más bajas de lo esperado en los mercados de capital privado. Avista Utilities espera estar en el extremo inferior del rango de orientación debido a costos más altos de suministro de energía, médicos y de deudas incobrables. La empresa planea invertir aproximadamente 515 millones de dólares en gastos de capital en Avista Utilities y 21 millones de dólares en AEL&P para 2024.
Avista Corp. (NYSE: AVA)는 2024년 3분기 순이익이 1,850만 달러(희석 주당 0.23달러)로, 2023년 3분기 1,470만 달러(주당 0.19달러)보다 증가했다고 보고했습니다. 올해 누적 순이익은 1억 1,280만 달러(주당 1.44달러)에 도달했으며, 2023년 8,700만 달러(주당 1.14달러)와 비교됩니다. 이 회사는 사모펀드 시장의 예상보다 낮은 평가로 인해 2024년 통합 수익 가이던스를 2.26-2.46달러로 하향 조정했습니다. Avista Utilities는 전력 공급, 의료 및 부실 채무 비용이 증가하여 가이던스 범위의 하한에 도달할 것으로 예상하고 있습니다. 이 회사는 2024년 Avista Utilities에 약 5억 1,500만 달러, AEL&P에 2,100만 달러의 자본 지출을 계획하고 있습니다.
Avista Corp. (NYSE: AVA) a annoncé un bénéfice net de 18,5 millions de dollars (0,23 dollar par action diluée) pour le troisième trimestre 2024, en hausse par rapport à 14,7 millions de dollars (0,19 dollar par action) pour le troisième trimestre 2023. Le bénéfice net depuis le début de l'année a atteint 112,8 millions de dollars (1,44 dollar par action), contre 87 millions de dollars (1,14 dollar par action) en 2023. L'entreprise a révisé ses prévisions de bénéfices consolidés pour 2024 à un intervalle de 2,26-2,46 dollars par action diluée en raison de valorisations inférieures aux attentes sur les marchés du capital-investissement. Avista Utilities s'attend à se situer à l'extrémité inférieure de la fourchette de prévisions en raison de l'augmentation des coûts de fourniture d'énergie, médicaux et des créances douteuses. L'entreprise prévoit d'investir environ 515 millions de dollars en dépenses d'investissement pour Avista Utilities et 21 millions de dollars pour AEL&P en 2024.
Avista Corp. (NYSE: AVA) berichtete im dritten Quartal 2024 von einem Nettogewinn von 18,5 Millionen Dollar (0,23 Dollar je verwässerter Aktie), was einem Anstieg gegenüber 14,7 Millionen Dollar (0,19 Dollar je Aktie) im dritten Quartal 2023 entspricht. Der Nettogewinn seit Jahresbeginn erreichte 112,8 Millionen Dollar (1,44 Dollar je Aktie), verglichen mit 87 Millionen Dollar (1,14 Dollar je Aktie) im Jahr 2023. Das Unternehmen hat seine Prognose für die konsolidierten Erträge für 2024 auf 2,26-2,46 Dollar je verwässerter Aktie aufgrund von geringeren als erwarteten Bewertungen auf den Märkten für Private Equity gesenkt. Avista Utilities erwartet, am unteren Ende des Prognosebereichs zu bleiben, da die Kosten für Stromversorgung, medizinische Versorgung und Forderungsausfälle gestiegen sind. Das Unternehmen plant, 2024 rund 515 Millionen Dollar in Investitionsausgaben für Avista Utilities und 21 Millionen Dollar für AEL&P zu investieren.
- Q3 2024 net income increased 25.6% to $18.5 million vs Q3 2023
- YTD net income grew 29.6% to $112.8 million compared to 2023
- Electric utility margin improved due to general rate cases
- Natural gas utility margin increased from rate case effects
- Lowered 2024 consolidated earnings guidance by $0.10 per share
- Higher than expected power supply, medical and bad debt costs
- Other businesses segment reported Q3 loss of $1.36 million vs $930,000 profit in 2023
- Interest expense increased due to higher rates and increased borrowings
Insights
Avista's Q3 2024 results show mixed performance with consolidated earnings of
Key metrics show utility margin improvements, with electric margin up
The announcement of Avista joining the North Plains Connector transmission project is strategically significant. This new transmission line connecting Bismarck, ND to Colstrip, MT will enhance regional grid reliability and resource diversification. The company's aggressive capital expenditure plan, targeting
The regulatory environment appears supportive, with pending rate cases in Washington and Oregon. The planned Idaho filing in early 2025 suggests a comprehensive approach to cost recovery across all jurisdictions, which is important for maintaining financial stability while funding infrastructure investments.
- Quarterly results demonstrate continued improvement at core utility from 2023
- Expect to be at the low end of Avista Utilities guidance range
- Lowering earnings guidance for our other businesses due to lower than expected investment valuations
SPOKANE, Wash., Nov. 06, 2024 (GLOBE NEWSWIRE) -- Avista Corp. (NYSE: AVA) today announced financial results for the third quarter of 2024. Net income and earnings per diluted share for the third quarter and year-to-date 2024 compared to the same periods in 2023 are presented in the table below (dollars in thousands, except per-share data):
| Third Quarter | Year-to-Date | |||||||||||||||
| 2024 | 2023 | 2024 | 2023 | |||||||||||||
| Net Income (Loss) by Business Segment: | ||||||||||||||||
| Avista Utilities | $ | 19,803 | $ | 13,498 | $ | 111,246 | $ | 83,935 | ||||||||
| AEL&P | 41 | 288 | 5,061 | 5,689 | ||||||||||||
| Other | (1,357 | ) | 930 | (3,467 | ) | (2,579 | ) | |||||||||
| Total net income | $ | 18,487 | $ | 14,716 | $ | 112,840 | $ | 87,045 | ||||||||
| Earnings (Loss) per Diluted Share by Business Segment: | ||||||||||||||||
| Avista Utilities | $ | 0.25 | $ | 0.18 | $ | 1.42 | $ | 1.10 | ||||||||
| AEL&P | — | — | 0.06 | 0.07 | ||||||||||||
| Other | (0.02 | ) | 0.01 | (0.04 | ) | (0.03 | ) | |||||||||
| Total earnings per diluted share | $ | 0.23 | $ | 0.19 | $ | 1.44 | $ | 1.14 | ||||||||
“Our consolidated financial results reflect continued improvement from 2023. With headwinds from higher than expected power supply, medical and bad debt costs, and ongoing legal expenses, we expect to be at the low end of the Avista Utilities guidance range. We continue to focus on the execution of our regulatory strategy as we seek recovery of our costs in each of our jurisdictions. We expect a constructive rate order for our Washington general rate cases in mid-December, and earlier this month, filed a general rate case in Oregon. We plan to file our next case in Idaho in early 2025," said Avista CEO Dennis Vermillion.
"We're excited to join the North Plains Connector transmission line project, and have signed a non-binding memorandum of understanding. This transmission line will be constructed with endpoints near Bismarck, North Dakota and Colstrip, Montana, which will improve regional reliability, diversify available resources, and support demand growth.
"With regard to our other businesses, we expected the private equity markets which drive valuations in our other businesses would improve in the latter half of 2024. That improvement has not materialized, and as a result, we are lowering our consolidated earnings guidance by
Non-GAAP Financial Measures
The tables below include electric and natural gas utility margin, two financial measures that are considered “non-GAAP financial measures.” The most directly comparable measure calculated and presented in accordance with GAAP is utility operating revenues.
The presentation of electric and natural gas utility margin is intended to enhance the understanding of operating performance, as it provides useful information to investors in their analysis of how changes in loads (due to weather, economic or other conditions), rates, supply costs and other factors impact our results of operations. These measures are not intended to replace utility operating revenues as determined in accordance with GAAP as an indicator of operating performance.
The following table reconciles Avista Utilities' operating revenues to utility margin (pre-tax and after-tax) for the three and nine months ended September 30 (dollars in thousands):
| Operating Revenues | Resource Costs | Utility Margin (Pre-Tax) | Income Taxes (a) | Utility Margin (Net of Tax) | ||||||||||||||||
| For the three months ended Sept. 30, 2024: | ||||||||||||||||||||
| Electric | $ | 316,692 | $ | 107,411 | $ | 209,281 | $ | 43,949 | $ | 165,332 | ||||||||||
| Natural Gas | 73,522 | 39,726 | 33,796 | 7,097 | 26,699 | |||||||||||||||
| Less: Intracompany | (6,468 | ) | (6,468 | ) | — | — | — | |||||||||||||
| Total | $ | 383,746 | $ | 140,669 | $ | 243,077 | $ | 51,046 | $ | 192,031 | ||||||||||
| For the three months ended Sept. 30, 2023: | ||||||||||||||||||||
| Electric | $ | 309,027 | $ | 116,729 | $ | 192,298 | $ | 40,383 | $ | 151,915 | ||||||||||
| Natural Gas | 74,323 | 43,741 | 30,582 | 6,422 | 24,160 | |||||||||||||||
| Less: Intracompany | (13,677 | ) | (13,677 | ) | — | — | — | |||||||||||||
| Total | $ | 369,673 | $ | 146,793 | $ | 222,880 | $ | 46,805 | $ | 176,075 | ||||||||||
| For the nine months ended Sept. 30, 2024: | ||||||||||||||||||||
| Electric | $ | 973,059 | $ | 364,798 | $ | 608,261 | $ | 127,734 | $ | 480,527 | ||||||||||
| Natural Gas | 411,379 | 226,446 | 184,933 | 38,836 | 146,097 | |||||||||||||||
| Less: Intracompany | (14,942 | ) | (14,942 | ) | — | — | — | |||||||||||||
| Total | $ | 1,369,496 | $ | 576,302 | $ | 793,194 | $ | 166,570 | $ | 626,624 | ||||||||||
| For the nine months ended Sept. 30, 2023: | ||||||||||||||||||||
| Electric | $ | 849,454 | $ | 301,764 | $ | 547,690 | $ | 115,015 | $ | 432,675 | ||||||||||
| Natural Gas | 378,242 | 206,460 | 171,782 | 36,074 | 135,708 | |||||||||||||||
| Less: Intracompany | (29,277 | ) | (29,277 | ) | — | — | — | |||||||||||||
| Total | $ | 1,198,419 | $ | 478,947 | $ | 719,472 | $ | 151,089 | $ | 568,383 | ||||||||||
| (a) | Income taxes for 2024 and 2023 were calculated using Avista Corp.'s federal statutory tax rate of 21 percent. |
Analysis of 2024 Consolidated Earnings
The table below presents the change in net income and diluted earnings per share for the third quarter and year-to-date 2024 as compared to the same periods in 2023, as well as the various factors, shown on an after-tax basis, that caused such change (dollars in thousands, except per-share data):
| Third Quarter | Year-to-Date | |||||||||||||||
| Net Income (a) | Earnings per Share | Net Income (a) | Earnings per Share | |||||||||||||
| 2023 consolidated earnings | $ | 14,716 | $ | 0.19 | $ | 87,045 | $ | 1.14 | ||||||||
| Changes in net income and diluted earnings per share: | ||||||||||||||||
| Avista Utilities | ||||||||||||||||
| Electric utility margin (b) | 13,417 | 0.17 | 47,852 | 0.61 | ||||||||||||
| Natural gas utility margin (c) | 2,539 | 0.03 | 10,389 | 0.13 | ||||||||||||
| Other operating expenses (d) | (3,552 | ) | (0.04 | ) | (13,176 | ) | (0.17 | ) | ||||||||
| Depreciation and amortization (e) | (710 | ) | (0.01 | ) | (4,008 | ) | (0.05 | ) | ||||||||
| Interest expense (f) | (1,474 | ) | (0.02 | ) | (3,803 | ) | (0.04 | ) | ||||||||
| Other | (2,230 | ) | (0.03 | ) | (806 | ) | (0.01 | ) | ||||||||
| Income tax at effective rate (g) | (1,685 | ) | (0.02 | ) | (9,137 | ) | (0.11 | ) | ||||||||
| Dilution on earnings | n/a | (0.01 | ) | n/a | (0.04 | ) | ||||||||||
| Total Avista Utilities | 6,305 | 0.07 | 27,311 | 0.32 | ||||||||||||
| AEL&P earnings | (247 | ) | — | (628 | ) | (0.01 | ) | |||||||||
| Other businesses earnings | (2,287 | ) | (0.03 | ) | (888 | ) | (0.01 | ) | ||||||||
| 2024 consolidated earnings | $ | 18,487 | $ | 0.23 | $ | 112,840 | $ | 1.44 | ||||||||
| (a) | The tax impact of each line item was calculated using Avista Corp.'s federal statutory tax rate of 21 percent. |
| (b) | Electric utility margin increased due to the effects of our general rate cases. Year-to-date, we had a |
| (c) | Natural gas utility margin increased and was impacted primarily by the effects of our general rate cases. |
| (d) | Other operating expenses increased year-to-date primarily due to increased maintenance for thermal generation, bad debt, legal and medical expenses. In addition, net amortizations and deferrals associated with wildfire mitigation costs have increased, with corresponding increases to revenue which result in no impact to earnings. |
| (e) | Depreciation and amortization increased primarily due to additions to utility plant. |
| (f) | Interest expense increased primarily due to increased interest rates and increased borrowings outstanding compared to 2023. |
| (g) | Our effective tax rate in the first three quarters of 2024 was positive 2.0 percent compared to negative 22.9 percent in the prior year. The expected effective tax rate for 2024 is positive 1.4 percent. We expect the tax customer credits in 2024 to be approximately half of the amounts recognized in 2023, due to a tranche of these credits being fully returned to customers as of the fourth quarter of 2023. |
Liquidity and Capital Resources
Liquidity
During 2024, we expect to issue approximately
As of Sept. 30, 2024, we had
Capital Expenditures and Other Investments
Avista Utilities' capital expenditures were
We expect capital expenditures to be about
In addition, we expect to invest
2024 Earnings Guidance and Outlook
Avista Corp. is lowering its 2024 consolidated earnings guidance to a range of
Including the expected ERM impact of negative
We expect AEL&P to contribute in the range of
Valuations in the private equity markets have not recovered to the degree we expected. As a result, we now expect our other businesses to have a net loss in the range of
Our guidance does not include the effect of unusual or non-recurring items until the effects are probable. Various factors could cause actual results to differ materially from our expectations, including our earnings guidance. Please refer to our 10-K for 2023, our 10-Q for the third quarter of 2024, and the cautionary statements below, for a full discussion of these factors.
NOTE: We will host a conference call with financial analysts and investors on Nov. 6, 2024, at 10:30 a.m. ET to discuss this news release. This call can be accessed on Avista’s website at investor.avistacorp.com. You must register for the call via the link at Avista’s website (investor.avistacorp.com) to access the call-in details for the webcast. A replay of the webcast will be available for one year on the Avista Corp. web site at investor.avistacorp.com.
Avista Corp. is an energy company involved in the production, transmission and distribution of energy as well as other energy-related businesses. Avista Utilities is our operating division that provides electric service to 420,000 customers and natural gas to 381,000 customers. Our service territory covers 30,000 square miles in eastern Washington, northern Idaho and parts of southern and eastern Oregon, with a population of 1.7 million. AERC is an Avista subsidiary that, through its subsidiary AEL&P, provides retail electric service to 18,000 customers in the city and borough of Juneau, Alaska. Our stock is traded under the ticker symbol “AVA”. For more information about Avista, please visit www.avistacorp.com.
Avista Corp. and the Avista Corp. logo are trademarks of Avista Corporation.
This news release contains forward-looking statements, including statements regarding our current expectations for future financial performance and cash flows, capital expenditures, financing plans, our current plans or objectives for future operations and other factors, which may affect the company in the future. Such statements are subject to a variety of risks, uncertainties and other factors, most of which are beyond our control and many of which could have significant impact on our operations, results of operations, financial condition or cash flows and could cause actual results to differ materially from those anticipated in such statements.
The following are among the important factors that could cause actual results to differ materially from the forward-looking statements:
Utility Regulatory Risk
state and federal regulatory decisions or related judicial decisions that affect our ability to recover costs and earn a reasonable return including, but not limited to, disallowance or delay in the recovery of capital investments, operating costs, commodity costs, the ordering of refunds to customers and discretion over allowed return on investment; the loss of regulatory accounting treatment, which could require the write-off of regulatory assets and the loss of regulatory deferral and recovery mechanisms;
Operational Risk
weather conditions, which affect both energy demand and electric generating capability, including the impact of precipitation and temperature on hydroelectric resources, the impact of wind patterns on wind-generated power, weather-sensitive customer demand, and similar impacts on supply and demand in the wholesale energy markets; wildfires ignited, or allegedly ignited, by our equipment or facilities could cause significant loss of life and property or result in liability for resulting fire suppression costs and/or damages, thereby causing serious operational, reputational and financial harm; severe weather or natural disasters, including, but not limited to, avalanches, wind storms, wildfires, earthquakes, extreme temperature events, snow and ice storms that could disrupt energy generation, transmission and distribution, as well as the availability and costs of fuel, materials, equipment, supplies and support services; political unrest and/or conflicts between foreign nation-states, which could disrupt the global, national and local economy, result in increases in operating and capital costs, impact energy commodity prices or our ability to access energy resources, create disruption in supply chains, disrupt, weaken or create volatility in capital markets, and increase cyber and physical security risks. In addition, any of these factors could negatively impact our liquidity and limit our access to capital, among other implications; explosions, fires, accidents, mechanical breakdowns or other incidents that could impair assets and may disrupt operations of our generation facilities, transmission, and electric and natural gas distribution systems or other operations and may require us to purchase replacement power or incur costs to repair our facilities; interruptions in the delivery of natural gas by our suppliers, including physical problems with pipelines themselves, can disrupt our service of natural gas to our customers and/or impair our ability to operate gas-fired electric generating facilities; explosions, fires, accidents or other incidents arising from or allegedly arising from our operations that could cause injuries to the public or property damage; blackouts or disruptions of interconnected transmission systems (the regional power grid); terrorist attacks, cyberattacks or other malicious acts that could disrupt or cause damage to our utility assets or to the national or regional economy in general, including effects of terrorism, cyberattacks, ransomware, or vandalism that damage or disrupt information technology systems; pandemics, which could disrupt our business, as well as the global, national and local economy, resulting in a decline in customer demand, deterioration in the creditworthiness of our customers, increases in operating and capital costs, workforce shortages, losses or disruptions in our workforce due to vaccine mandates, delays in capital projects, disruption in supply chains, and disruption, weakness and volatility in capital markets. In addition, any of these factors could negatively impact our liquidity and limit our access to capital, among other implications; work-force issues, including changes in collective bargaining unit agreements, strikes, work stoppages, the loss of key executives, availability of workers in a variety of skill areas, and our ability to recruit and retain employees; changes in the availability and price of purchased power, fuel and natural gas, as well as transmission capacity; increasing costs of insurance, more restrictive coverage terms and our ability to obtain insurance; delays or changes in construction costs, and/or our ability to obtain required permits and materials for present or prospective facilities; increasing health care costs and cost of health insurance provided to our employees and retirees; increasing operating costs, including effects of inflationary pressures; third party construction of buildings, billboard signs, towers or other structures within our rights of way, or placement of fuel containers within close proximity to our transformers or other equipment, including overbuilding atop natural gas distribution lines; the loss of key suppliers for materials or services or other disruptions to the supply chain; adverse impacts to our Alaska electric utility (AEL&P) that could result from an extended outage of its hydroelectric generating resources or their inability to deliver energy, due to their lack of interconnectivity to other electrical grids and the availability or cost of replacement power (diesel); changing river or reservoir regulation or operations at hydroelectric facilities not owned by us, which could impact our hydroelectric facilities downstream;
Climate Change Risk
increasing frequency and intensity of severe weather or natural disasters resulting from climate change, that could disrupt energy generation, transmission and distribution, as well as the availability and costs of fuel, materials, equipment, supplies and support services; change in the use, availability or abundancy of water resources and/or rights needed for operation of our hydroelectric facilities, including impacts resulting from climate change; changes in the long-term climate and weather could materially affect, among other things, customer demand, the volume and timing of streamflows required for hydroelectric generation, costs of generation, transmission and distribution. Increased or new risks may arise from severe weather or natural disasters, including wildfires as well as their increased occurrence and intensity related to changes in climate;
Cybersecurity Risk
cyberattacks on the operating systems used in the operation of our electric generation, transmission and distribution facilities and our natural gas distribution facilities, and cyberattacks on such systems of other energy companies with which we are interconnected, which could damage or destroy facilities or systems or disrupt operations for extended periods of time and result in the incurrence of liabilities and costs; cyberattacks on the administrative systems used in the administration of our business, including customer billing and customer service, accounting, communications, compliance and other administrative functions, and cyberattacks on such systems of our vendors and other companies with which we do business, resulting in the disruption of business operations, the release of private information and the incurrence of liabilities and costs;
Technology Risk
changes in technologies, possibly making some of the current technology we utilize obsolete or introducing new cyber security risks and other new risks inherent in the use, by either us or our counterparties, of new technologies in the developmental stage including, without limitation, generative artificial intelligence; changes in the use, perception, or regulation of generative artificial intelligence technologies, which could limit our ability to utilize such technology, create risk of enhanced regulatory scrutiny, generate uncertainty around intellectual property ownership, licensing or use, or which could otherwise result in risk of damage to our business, reputation or financial results; changes in costs that impede our ability to implement new information technology systems or to operate and maintain current production technology; insufficient technology skills, which could lead to the inability to develop, modify or maintain our information systems;
Strategic Risk
growth or decline of our customer base due to new uses for our services or decline in existing services, including, but not limited to, the effect of the trend toward distributed generation at customer sites; the potential effects of negative publicity regarding our business practices, whether true or not, which could hurt our reputation and result in litigation or a decline in our common stock price; changes in our strategic business plans, which could be affected by any or all of the foregoing, including the entry into new businesses and/or the exit from existing businesses and the extent of our business development efforts where potential future business is uncertain; wholesale and retail competition including alternative energy sources, growth in customer-owned power resource technologies that displace utility-supplied energy or may be sold back to the utility, and alternative energy suppliers and delivery arrangements; non-regulated activities may increase earnings volatility and result in investment losses; the risk of municipalization or other forms of service territory reduction;
External Mandates Risk
changes in environmental laws, regulations, decisions and policies, including, but not limited to, regulatory responses to concerns regarding climate change, efforts to restore anadromous fish in areas currently blocked by dams, more stringent requirements related to air quality, water quality and waste management, present and potential environmental remediation costs and our compliance with these matters; the potential effects of initiatives, legislation or administrative rulemaking at the federal, state or local levels, including possible effects on our generating resources, prohibitions or restrictions on new or existing services, or restrictions on greenhouse gas emissions to mitigate concerns over climate changes, including future limitations on the usage and distribution of natural gas; political pressures or regulatory practices that could constrain or place additional cost burdens on our distribution systems through accelerated adoption of distributed generation or electric-powered transportation or on our energy supply sources, such as campaigns to halt fossil fuel-fired power generation and opposition to other thermal generation, wind turbines or hydroelectric facilities; failure to identify changes in legislation, taxation and regulatory issues that could be detrimental or beneficial to our overall business; policy and/or legislative changes in various regulated areas, including, but not limited to, environmental regulation, healthcare regulations and import/export regulations;
Financial Risk
our ability to obtain financing through the issuance of debt and/or equity securities and access to our funds held with financial institutions, which could be affected by various factors including our credit ratings, interest rates, other capital market conditions and global economic conditions; changes in interest rates that affect borrowing costs, variable interest rate borrowing and the extent to which we recover interest costs through retail rates collected from customers; volatility in energy commodity markets that affect our ability to effectively hedge energy commodity risks, including cash flow impacts and requirements for collateral; volatility in the carbon emissions allowances market that could result in increased compliance costs; changes in actuarial assumptions, interest rates and the actual return on plan assets for our pension and other postretirement benefit plans, which could affect future funding obligations, pension and other postretirement benefit expense and the related liabilities; the outcome of legal proceedings and other contingencies; economic conditions in our service areas, including the economy's effects on customer demand for utility services; economic conditions nationally may affect the valuation of our unregulated portfolio companies; declining electricity demand related to customer energy efficiency, conservation measures and/or increased distributed generation and declining natural gas demand related to customer energy efficiency, conservation measures and/or increased electrification; industry and geographic concentrations which could increase our exposure to credit risks due to counterparties, suppliers and customers being similarly affected by changing conditions; deterioration in the creditworthiness of our customers; activist shareholders may result in additional costs and resources required in response to activist actions;
Energy Commodity Risk
volatility and illiquidity in wholesale energy markets, including exchanges, the availability of willing buyers and sellers, changes in wholesale energy prices that could affect operating income, cash requirements to purchase electricity and natural gas, value received for wholesale sales, collateral required of us by individual counterparties and/or exchanges in wholesale energy transactions and credit risk from such transactions, and the market value of derivative assets and liabilities; default or nonperformance on the part of parties from whom we purchase and/or sell capacity or energy; potential environmental regulations or lawsuits affecting our ability to utilize or resulting in the obsolescence of our power supply resources; explosions, fires, accidents, pipeline ruptures or other incidents that could limit energy supply to our facilities or our surrounding territory, which could result in a shortage of commodities in the market that could increase the cost of replacement commodities from other sources;
Compliance Risk
changes in laws, regulations, decisions and policies at the federal, state or local levels, which could materially impact both our electric and gas operations and costs of operations; and the ability to comply with the terms of the licenses and permits for our hydroelectric or thermal generating facilities at cost-effective levels.
For a further discussion of these factors and other important factors, please refer to our Quarterly report on Form 10-Q for the quarter ended Sept. 30, 2024. The forward-looking statements contained in this news release speak only as of the date hereof. We undertake no obligation to update any forward-looking statement or statements to reflect events or circumstances that occur after the date on which such statement is made or to reflect the occurrence of unanticipated events. New risks, uncertainties and other factors emerge from time to time, and it is not possible for management to predict all of such factors, nor can it assess the impact of each such factor on our business or the extent to which any such factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement.
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Issued by: Avista Corporation
Contact:
Media: Lena Funston (509) 495-8090 lena.funston@avistacorp.com
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