Oge Energy (OGE) 7 Aug 24 2024 Q2 Earnings call transcript
The OGE Energy Corp. held its 2024 second-quarter earnings call, highlighting a solid performance and a promising outlook for the future. The call was led by Sean Trauschke, the Chairman, President, and CEO, accompanied by Bryan Buckler, the CFO, and Jason Bailey, the Director of Investor Relations.
Financial Performance and Outlook
The company reported consolidated earnings of $0.51 per share, including $0.54 per share for OG&E and a holding company loss of $0.03 per share. This performance was attributed to exceptional loan growth and warmer-than-normal weather, offsetting expected increased depreciation from capital investments. For the full year, the company expects to be in the top half of its EPS range, with an updated expectation of 4% to 6% load growth.
Operational and Customer Growth
The second quarter witnessed solid operational and customer results, with a 5.8% increase in weather-normalized demand for electricity year-to-date. The company's focus on attracting new businesses to its service area, driven by low rates, has resulted in a robust backlog of potential growth. The load growth is not only from large-scale industries like manufacturing, but also from small businesses and residential customers.
Regulatory and Infrastructure Developments
The company is actively pursuing an increase in its smart hours discount for seniors and additional funds for forestry and vegetation management. The Oklahoma rate review process is underway, with the ALJ recommending the uncontested settlement for approval. The company is also looking to issue RFPs in support of its current integrated resource plan, with a focus on incrementally layering in generation capacity through new generation, continued plan upgrades, and energy efficiency and demand response.
Investor and Analyst Questions
During the Q&A session, analysts raised questions on potential tailwinds from July and August weather, O&M contingency, the impact of data center discussions on load forecasts, and the potential for formula rate or PBR frameworks in the future. The company responded with a confident outlook, emphasizing its commitment to delivering earnings growth, managing its capital expenditures, and addressing regulatory and transmission opportunities.
Conclusion
In conclusion, OGE Energy Corp.'s second-quarter earnings call presented a mixed picture of challenges and opportunities. The company's financial performance was solid, and its operational and customer growth are promising. The regulatory and infrastructure developments underscore its commitment to delivering reliable and affordable electricity to its customers. The company's outlook for the future is positive, with a focus on incrementally layering in generation capacity and pursuing a consistent cadence of rate cases. Overall, OGE Energy Corp. is well-positioned to navigate the evolving energy landscape and continue its growth trajectory.