WEC Energy Group reports first-quarter results

Rhea-AI Summary

WEC Energy Group reported strong first-quarter results with net income of $622.3 million, or $1.97 per share, up from last year. Consolidated revenues totaled $2.7 billion, down slightly from the previous year. The company focused on financial discipline, operating efficiency, and customer satisfaction amidst a warm winter in Wisconsin. Natural gas and electricity deliveries showed variations, with the company reaffirming its 2024 earnings guidance of $4.80 to $4.90 per share.

Positive

• Strong first-quarter results with net income of $622.3 million, or $1.97 per share, up from last year.

• Continued focus on financial discipline, operating efficiency, and customer satisfaction.

• Reaffirmed 2024 earnings guidance of $4.80 to $4.90 per share.

Negative

• Consolidated revenues totaled $2.7 billion, down slightly from the previous year.

• Natural gas deliveries in Wisconsin fell by 5.8 percent compared to the first quarter of 2023.

• Electricity consumption showed variations, with residential electricity use falling by 1.1 percent.

Insights

Financial Analyst

WEC Energy Group's report of a significant increase in net income to $622.3 million from $507.5 million year-over-year, alongside a decrease in consolidated revenues, presents a nuanced financial situation. The rise in earnings per share (EPS) from $1.61 to $1.97 indicates improved profitability, which could be attributed to cost management strategies, particularly given the reported focus on financial discipline and operating efficiency. However, the dip in revenues requires examination of underlying causes, such as the decrement in natural gas deliveries and mixed electricity consumption patterns across different customer segments. The company's reaffirmation of its earnings guidance for 2024, assuming normal weather conditions, provides a positive outlook for continued financial stability. Investors should monitor subsequent quarters to evaluate the sustainability of this profitability, particularly in the context of fluctuating weather patterns and energy consumption trends.

Energy Sector Analyst

The energy consumption data within the WEC Energy Group report presents a mixed picture with declines in natural gas deliveries and residential electricity use, contrasting with an uptick in electricity consumption among small commercial and industrial customers. This reflects broader trends in the energy sector where weather conditions, economic factors and efficiency measures play a pivotal role in shaping demand. The decreased use of natural gas for heating, given the warmest winter on record in Wisconsin, is an example of how weather can significantly impact utility companies' volumes. Furthermore, the slight decline in large commercial and industrial electricity consumption could be indicative of energy-saving initiatives or shifts in industrial activity. Investors should consider the potential volatility in this sector due to environmental factors and the increasing momentum towards renewable energy sources, which may affect long-term demand for traditional utilities.

MILWAUKEE, May 1, 2024 /PRNewswire/ -- WEC Energy Group (NYSE: WEC) today reported net income of $622.3 million, or $1.97 per share, for the first quarter of 2024 — up from $507.5 million, or $1.61 per share, in last year's first quarter.

Consolidated revenues totaled $2.7 billion, down $207.9 million from the first quarter a year ago.

"Throughout the warmest winter in Wisconsin history, we remained laser focused on financial discipline, operating efficiency, and customer satisfaction," said Gale Klappa, executive chairman. "And we're confident that we can deliver another year of strong results — in line with our guidance for 2024."

For the quarter, natural gas deliveries in Wisconsin — excluding natural gas used for power generation — fell by 5.8 percent compared to the first quarter of 2023.

Retail deliveries of electricity — excluding the iron ore mine in Michigan's Upper Peninsula — were down by 0.3 percent in the first quarter of 2024, compared to the first quarter last year.

Electricity consumption by small commercial and industrial customers rose by 0.7 percent. Electricity use by large commercial and industrial customers — excluding the iron ore mine — declined by 0.7 percent.

Residential electricity use fell by 1.1 percent.

On a weather-normal basis, retail deliveries of electricity — excluding the iron ore mine — decreased by 0.2 percent.

The company is reaffirming its 2024 earnings guidance of $4.80 to $4.90 per share. This assumes normal weather for the remainder of the year.

Earnings per share listed in this news release are on a fully diluted basis.

Conference call

A conference call is scheduled for 1 p.m. Central time, Wednesday, May 1. The call will review 2024 first-quarter earnings and the company's outlook for the future.

All interested parties, including stockholders, news media and the general public, are invited to listen. Access the call at 888-330-2443 up to 15 minutes before it begins. The number for international callers is 240-789-2728. The conference ID is 3088105.

Conference call access also is available at wecenergygroup.com. Under 'Webcasts,' select 'Q1 Earnings.' In conjunction with this earnings announcement, WEC Energy Group will post on its website a package of detailed financial information on its first-quarter performance. The materials will be available at 6:30 a.m. Central time, Wednesday, May 1.

Replay

A replay will be available on the website and by phone. Access to the webcast replay will be available on the website about two hours after the call. Access to a phone replay also will be available approximately two hours after the call and remain accessible through May 15, 2024. Domestic callers should dial 800-770-2030. International callers should dial 647-362-9199. The replay conference ID is 3088105.

WEC Energy Group (NYSE: WEC), based in Milwaukee, is one of the nation's premier energy companies, serving 4.7 million customers in Wisconsin, Illinois, Michigan and Minnesota.

The company's principal utilities are We Energies, Wisconsin Public Service, Peoples Gas, North Shore Gas, Michigan Gas Utilities, Minnesota Energy Resources and Upper Michigan Energy Resources. Another major subsidiary, We Power, designs, builds and owns electric generating plants. In addition, WEC Infrastructure LLC owns a growing fleet of renewable generation facilities in states ranging from South Dakota to Texas.

WEC Energy Group (wecenergygroup.com) is a Fortune 500 company and a component of the S&P 500. The company has approximately 35,000 stockholders of record, 7,000 employees and more than $43 billion of assets.

Forward-looking statements

Certain statements contained in this press release are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These statements are based upon management's current expectations and are subject to risks and uncertainties that could cause our actual results to differ materially from those contemplated in the statements. Readers are cautioned not to place undue reliance on these statements. Forward-looking statements include, among other things, statements concerning management's expectations and projections regarding earnings, earnings growth rates, dividend payments and future results. In some cases, forward-looking statements may be identified by reference to a future period or periods or by the use of forward-looking terminology such as "anticipates," "believes," "estimates," "expects," "forecasts," "guidance," "intends," "may," "objectives," "plans," "possible," "potential," "projects," "should," "targets," "will" or similar terms or variations of these terms.

Factors that could cause actual results to differ materially from those contemplated in any forward-looking statements include, but are not limited to: general economic conditions, including business and competitive conditions in the company's service territories; timing, resolution and impact of rate cases and other regulatory decisions; including rider reconciliations; the company's ability to continue to successfully integrate the operations of its subsidiaries; availability of the company's generating facilities and/or distribution systems; unanticipated changes in fuel and purchased power costs; key personnel changes; unusual, varying or severe weather conditions; continued industry restructuring and consolidation; continued advances in, and adoption of, new technologies that produce power or reduce power consumption; energy and environmental conservation efforts; electrification initiatives, mandates and other efforts to reduce the use of natural gas; the company's ability to successfully acquire and/or dispose of assets and projects and to execute on its capital plan; terrorist, physical or cyber-security threats or attacks and data security breaches; construction risks; labor disruptions; equity and bond market fluctuations; changes in the company's and its subsidiaries' ability to access the capital markets and shareholder approval of related proposals; changes in tax legislation or our ability to use certain tax benefits and carryforwards; federal, state, and local legislative and regulatory changes, including changes in rate-setting policies or procedures and environmental standards, the enforcement of these laws and regulations or permit conditions and changes in the interpretation of regulations by regulatory agencies; supply chain disruptions; inflation; political or geopolitical developments, including impacts on the global economy, supply chain and fuel prices, generally, from ongoing, escalating, or expanding regional conflicts; the impact from any health crises, including epidemics and pandemics; current and future litigation and regulatory investigations, proceedings or inquiries; changes in accounting standards; the financial performance of the American Transmission Company as well as projects in which the company's energy infrastructure business invests; the ability of the company to obtain additional generating capacity at competitive prices; goodwill and its possible impairment; and other factors described under the heading "Factors Affecting Results, Liquidity and Capital Resources" in Management's Discussion and Analysis of Financial Condition and Results of Operations and under the headings "Cautionary Statement Regarding Forward-Looking Information" and "Risk Factors" contained in the company's Form 10-K for the year ended December 31, 2023, and in subsequent reports filed with the Securities and Exchange Commission. Except as may be required by law, the company expressly disclaims any obligation to publicly update or revise any forward-looking information.

Tables follow

 

WEC ENERGY GROUP, INC.
CONDENSED CONSOLIDATED INCOME STATEMENTS (Unaudited)		Three Months Ended
		March 31
(in millions, except per share amounts)		2024		2023
Operating revenues		$                   2,680.2		$                   2,888.1
Operating expenses
Cost of sales		927.1		1,309.7
Other operation and maintenance		530.8		534.0
Depreciation and amortization		333.4		305.5
Property and revenue taxes		75.5		69.6
Total operating expenses		1,866.8		2,218.8
Operating income		813.4		669.3
Equity in earnings of transmission affiliates		44.8		43.8
Other income, net		44.1		40.8
Interest expense		192.0		172.2
Other expense		(103.1)		(87.6)
Income before income taxes		710.3		581.7
Income tax expense		87.7		74.1
Net income		622.6		507.6
Preferred stock dividends of subsidiary		0.3		0.3
Net loss attributed to noncontrolling interests		—		0.2
Net income attributed to common shareholders		$                      622.3		$                      507.5
Earnings per share
Basic		$                        1.97		$                        1.61
Diluted		$                        1.97		$                        1.61
Weighted average common shares outstanding
Basic		315.6		315.4
Diluted		315.9		315.9
Dividends per share of common stock		$                    0.8350		$                    0.7800

 

WEC ENERGY GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in millions, except share and per share amounts)		March 31, 2024		December 31, 2023
Assets
Current assets
Cash and cash equivalents		$                           38.9		$                           42.9
Accounts receivable and unbilled revenues, net of reserves of $190.7 and $193.5, respectively		1,557.0		1,503.2
Materials, supplies, and inventories		608.6		775.2
Prepaid taxes		143.0		173.9
Other prepayments		70.9		76.8
Other		186.2		223.7
Current assets		2,604.6		2,795.7
Long-term assets
Property, plant, and equipment, net of accumulated depreciation and amortization of $11,275.0 and $11,073.1, respectively		31,729.8		31,581.5
Regulatory assets (March 31, 2024 and December 31, 2023 include $84.1 and $85.9, respectively, related to WEPCo Environmental Trust Finance I, LLC)		3,247.0		3,249.8
Equity investment in transmission affiliates		2,027.1		2,005.9
Goodwill		3,052.8		3,052.8
Pension and OPEB assets		883.9		870.9
Other		382.0		383.1
Long-term assets		41,322.6		41,144.0
Total assets		$                   43,927.2		$                   43,939.7
Liabilities and Equity
Current liabilities
Short-term debt		$                     2,574.2		$                     2,020.9
Current portion of long-term debt (March 31, 2024 and December 31, 2023 include $9.0, related to WEPCo Environmental Trust Finance I, LLC)		640.5		1,264.2
Accounts payable		640.9		896.6
Other		854.1		933.1
Current liabilities		4,709.7		5,114.8
Long-term liabilities
Long-term debt (March 31, 2024 and December 31, 2023 include $85.4 and $85.3, respectively, related to WEPCo Environmental Trust Finance I, LLC)		15,375.8		15,512.8
Deferred income taxes		5,120.0		4,918.5
Deferred revenue, net		351.1		356.4
Regulatory liabilities		3,730.2		3,697.7
Intangible liabilities		581.4		594.8
Environmental remediation liabilities		448.9		463.7
Asset retirement obligations		377.7		374.2
Other		806.3		835.3
Long-term liabilities		26,791.4		26,753.4
Commitments and contingencies
Common shareholders' equity
Common stock – $0.01 par value; 325,000,000 shares authorized; 315,822,587 and 315,434,531 shares outstanding, respectively		3.2		3.2
Additional paid in capital		4,145.7		4,115.9
Retained earnings		7,971.6		7,612.8
Accumulated other comprehensive loss		(7.8)		(7.7)
Common shareholders' equity		12,112.7		11,724.2
Preferred stock of subsidiary		30.4		30.4
Noncontrolling interests		283.0		316.9
Total liabilities and equity		$                   43,927.2		$                   43,939.7

 

WEC ENERGY GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)		Three Months Ended
		March 31
(in millions)		2024		2023
Operating activities
Net income		$                      622.6		$                      507.6
Reconciliation to cash provided by operating activities
Depreciation and amortization		333.4		305.5
Deferred income taxes and ITCs, net		184.3		56.5
Contributions and payments related to pension and OPEB plans		(4.0)		(5.5)
Equity income in transmission affiliates, net of distributions		(9.1)		(6.4)
Change in –
Accounts receivable and unbilled revenues, net		(61.3)		60.7
Materials, supplies, and inventories		166.6		293.6
Collateral on deposit		17.2		(91.8)
Other current assets		19.7		89.4
Accounts payable		(229.8)		(424.7)
Other current liabilities		(44.8)		63.7
Other, net		(131.2)		(52.5)
Net cash provided by operating activities		863.6		796.1
Investing activities
Capital expenditures		(444.5)		(499.4)
Acquisition of Whitewater Cogeneration Facility		—		(76.0)
Acquisition of Sapphire Sky Wind Energy LLC, net of cash acquired of $0.3		—		(442.6)
Acquisition of Samson I Solar Energy Center LLC, net of cash acquired of $5.2		—		(249.4)
Capital contributions to transmission affiliates		(12.1)		(6.1)
Proceeds from the sale of investments held in rabbi trust		14.8		10.4
Other, net		5.6		(4.8)
Net cash used in investing activities		(436.2)		(1,267.9)
Financing activities
Exercise of stock options		3.7		0.9
Issuance of common stock		19.2		—
Purchase of common stock		(2.0)		(6.9)
Dividends paid on common stock		(263.5)		(246.1)
Issuance of long-term debt		—		1,100.0
Retirement of long-term debt		(756.9)		(35.2)
Change in commercial paper		552.8		(385.4)
Purchase of additional ownership interest in Samson I Solar Energy Center LLC from noncontrolling interest		(28.1)		—
Other, net		(1.7)		(9.7)
Net cash provided by (used in) financing activities		(476.5)		417.6
Net change in cash, cash equivalents, and restricted cash		(49.1)		(54.2)
Cash, cash equivalents, and restricted cash at beginning of period		165.2		182.2
Cash, cash equivalents, and restricted cash at end of period		$                      116.1		$                      128.0

 

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SOURCE WEC Energy Group

FAQ

<p>What was WEC Energy Group's net income for the first quarter of 2024?</p>

WEC Energy Group reported a net income of $622.3 million for the first quarter of 2024.

<p>What were the earnings per share for WEC Energy Group in the first quarter of 2024?</p>

WEC Energy Group reported earnings per share of $1.97 for the first quarter of 2024.

<p>What is WEC Energy Group's 2024 earnings guidance?</p>

WEC Energy Group reaffirmed its 2024 earnings guidance of $4.80 to $4.90 per share.

<p>How did electricity consumption by small commercial and industrial customers change in the first quarter of 2024?</p>

Electricity consumption by small commercial and industrial customers rose by 0.7 percent in the first quarter of 2024.

<p>What was the change in natural gas deliveries in Wisconsin in the first quarter of 2024?</p>

Natural gas deliveries in Wisconsin fell by 5.8 percent in the first quarter of 2024.