Black Hills Corp. Completes 2024 Equity Issuances

Rhea-AI Summary

Black Hills Corp. (NYSE: BKH) has successfully completed its 2024 equity issuances through a block equity trade via its at-the-market (ATM) equity offering program. The company raised net proceeds of $181.6 million by issuing 3.3 million shares, meeting its previously stated equity needs of $170 million to $190 million for 2024. These funds will be used to finance the company's capital expenditure program and for general corporate purposes.

CEO Linn Evans stated that this financing supports the execution of Black Hills Corp.'s long-term strategic plan, including growth initiatives like the Ready Wyoming electric transmission expansion project and other safety and integrity investments. Black Hills Corp. serves 1.34 million natural gas and electric utility customers across eight states in the U.S.

Positive

• Successful completion of 2024 equity issuances, raising $181.6 million
• Met previously stated equity needs of $170-$190 million
• Funds to be used for capital expenditure program and growth initiatives
• Supports execution of long-term strategic plan

Negative

• Potential dilution of existing shareholders due to issuance of 3.3 million new shares

Insights

Financial Analyst

Black Hills Corp's completion of its 2024 equity issuances is a strategic financial move with mixed implications. The company raised $181.6 million by issuing 3.3 million shares, aligning with their projected range of $170-$190 million. This capital injection will fund their expansion projects, particularly the Ready Wyoming electric transmission project.

While this equity issuance provides necessary funding, it also leads to shareholder dilution. The 3.3% increase in outstanding shares may pressure earnings per share in the short term. However, if the capital is effectively deployed in growth initiatives, it could drive long-term value creation.

Investors should monitor how efficiently Black Hills utilizes this capital and whether the Ready Wyoming project and other investments generate returns exceeding the cost of equity. The company's ability to execute these projects successfully will be important in determining the long-term impact of this equity issuance on shareholder value.

Utility Sector Analyst

Black Hills Corp's equity issuance reflects the capital-intensive nature of the utility sector. The focus on transmission expansion and safety investments aligns with industry trends towards grid modernization and reliability enhancement. These initiatives are important for utilities to meet evolving regulatory requirements and customer expectations.

The Ready Wyoming project, in particular, could strengthen Black Hills' competitive position in the region. Expanded transmission capacity often leads to improved system reliability and the potential for increased renewable energy integration, both of which are increasingly valued in the utility sector.

However, investors should be aware that such large-scale projects often face regulatory scrutiny and potential delays. The success of these initiatives will depend on Black Hills' ability to navigate regulatory processes efficiently and deliver projects on time and within budget. Keep an eye on project milestones and regulatory approvals as indicators of the company's execution capabilities.

RAPID CITY, S.D., Aug. 19, 2024 (GLOBE NEWSWIRE) -- Black Hills Corp. (NYSE: BKH) announced that it executed a block equity trade through its at-the-market (“ATM”) equity offering program to satisfy its equity needs for 2024.

For the year, the company received net proceeds of $181.6 million, for a total issuance of 3.3 million shares, which are being used to fund its capital expenditure program and for general corporate purposes. The completion of this transaction achieved the company’s previously stated 2024 equity needs of $170 million to $190 million.   

"Fulfilling our 2024 equity needs supports the execution of our long-term strategic plan," said Linn Evans, president and CEO of Black Hills Corp. "The financing is being used to fund our capital requirements for growth initiatives, such as the Ready Wyoming electric transmission expansion project, and other safety and integrity investments to provide safe, reliable, and cost-effective energy for our customers."

Black Hills Corporation
Black Hills Corp. (NYSE: BKH) is a customer-focused, growth-oriented utility company with a tradition of improving life with energy and a vision to be the energy partner of choice. Based in Rapid City, South Dakota, the company serves 1.34 million natural gas and electric utility customers in eight states: Arkansas, Colorado, Iowa, Kansas, Montana, Nebraska, South Dakota and Wyoming. More information is available at www.blackhillscorp.com.

CAUTION REGARDING FORWARD-LOOKING STATEMENTS

This news release includes “forward-looking statements” as defined by the Securities and Exchange Commission, or SEC. We make these forward-looking statements in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, included in this news release that address activities, events or developments that we expect, believe or anticipate will or may occur in the future are forward-looking statements. These forward-looking statements are based on assumptions which we believe are reasonable based on current expectations and projections about future events, including future anticipated equity needs, and industry conditions and trends affecting our business. However, whether actual results and developments will conform to our expectations and predictions is subject to a number of risks and uncertainties that, among other things, could cause actual results to differ materially from those contained in the forward-looking statements, the risk factors described in Item 1A of Part I of our 2023 Annual Report on Form 10-K filed with the SEC, and other reports that we file with the SEC from time to time. New factors that could cause actual results to differ materially from those described in forward looking statements emerge from time-to-time, and it is not possible for us to predict all such factors, or the extent to which any such factor or combination of factors may cause actual results to differ from those contained in any forward-looking statement. We assume no obligation to update publicly any such forward-looking statements, whether as a result of new information, future events or otherwise.

Investor Relations
Sal Diaz
605-399-5079
investorrelations@blackhillscorp.com

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FAQ

How much did Black Hills Corp. (BKH) raise in its 2024 equity issuance?

Black Hills Corp. raised net proceeds of $181.6 million in its 2024 equity issuance.

How many new shares did Black Hills Corp. (BKH) issue in 2024?

Black Hills Corp. issued 3.3 million new shares in its 2024 equity issuance.

What will Black Hills Corp. (BKH) use the proceeds from its 2024 equity issuance for?

The proceeds will be used to fund Black Hills Corp.'s capital expenditure program, growth initiatives like the Ready Wyoming electric transmission expansion project, and for general corporate purposes.

How many customers does Black Hills Corp. (BKH) serve?

Black Hills Corp. serves 1.34 million natural gas and electric utility customers across eight states in the U.S.