Idacorp (IDA) 1 Aug 24 2024 Q2 Earnings call transcript

In the recent earnings call for the second quarter of 2024, IDACORP showcased impressive financial results, driven by strong customer growth and robust operational performance. The company's focus on innovation, efficiency, and strategic investments in infrastructure and technology were highlighted as key factors contributing to its success.

Financial Performance and Growth

IDACORP reported a diluted earnings per share of $1.71 for the second quarter of 2024, representing a significant increase from $1.35 in the same quarter last year. This positive trend continued into the first half of the year, with earnings per diluted share reaching $2.67 compared to $2.46 during the same period last year. These results were attributed to a combination of customer growth, higher customer usage, and the revenue benefits from rate changes.

The company also updated its earnings guidance for the full year of 2024, raising the lower end of the previously reported range to $5.30 to $5.45 per diluted share. This revision reflects the company's strong operating performance and the reduction in estimated tax credit usage.

Customer Growth and Infrastructure Development

IDACORP highlighted its customer base growth of 2.6% since the second quarter of last year, with a 2.8% increase for residential customers. The company's service area is experiencing robust economic expansion, with Moody's forecasting a GDP growth of 4.3% in 2024 and 3.8% in 2025. This growth is attracting increased interest from projects across various industries, including manufacturing, food processing, and data centers.

To support this growth, IDACORP is investing in infrastructure and services, with a focus on serving new record peak loads. The company has recently celebrated the successful completion of a $415 million expansion at Lamb Weston's facility in American Falls, making it one of the largest frozen potato processing facilities in the world.

Regulatory Filings and Transmission Projects

IDACORP's regulatory filings in both Idaho and Oregon are moving forward, with a settlement reached in the Oregon general rate case, resulting in an overall rate increase of $6.7 million or approximately 12%. The company is also working on a limited scope rate case in Idaho to recover infrastructure investment and labor expenses not included in the last general rate case.

In terms of transmission projects, IDACORP is negotiating for additional resources to come online in summer 2026 and has initiated an all-source RFP for resource needs in 2028 or later. The company is also planning to convert its remaining coal-fired units to natural gas, reducing carbon emissions while maintaining generating capacity.

Operational Challenges and Future Outlook

Despite facing operational challenges, including the impact of wildfires and regulatory delays, IDACORP remains optimistic about its future. The company is actively working to mitigate the effects of wildfires and has a public safety power shutoff plan in place. It is also exploring new technologies and strategies to enhance system reliability and resilience.

Looking ahead, IDACORP is focused on maintaining its strong financial position and continuing to invest in its infrastructure and services to meet the growing demands of its customers. The company's strategic investments in renewable energy, transmission projects, and customer growth initiatives are expected to drive long-term growth and sustainability.

Conclusion

IDACORP's second quarter 2024 earnings call provided a comprehensive overview of the company's financial performance, strategic initiatives, and operational challenges. With a strong focus on customer growth, infrastructure development, and regulatory compliance, IDACORP is well-positioned to navigate the complexities of the utility industry and continue its growth trajectory. The company's commitment to innovation, efficiency, and sustainability is a testament to its resilience and adaptability in a rapidly evolving market. As IDACORP moves forward, it will be interesting to see how it balances its growth ambitions with the need to maintain affordability and regulatory compliance.