- 2020 GAAP EPS of $2.72, compared with $2.79 in 2019; Adjusted
EPS (Non-GAAP) of $3.10, an increase of 7% vs 2019
- Declares quarterly dividend of $0.535
- Issues 2021 GAAP EPS guidance of $3.14 to $3.34; Adjusted EPS
guidance of $3.20 to $3.40
- Increases five-year capital plan to $9.2 billion through
2025
Evergy, Inc. (NYSE: EVRG) today announced full year GAAP 2020
earnings of $618 million, or $2.72 per share, compared with
earnings of $670 million, or $2.79 per share, for the full year
2019. Fourth quarter 2020 GAAP earnings were $51 million, or $0.22
per share, compared with earnings of $64 million, or $0.28 per
share, for the fourth quarter of 2019.
For the year, GAAP earnings decreased primarily due to lower
retail sales driven by unfavorable weather and a decrease in
weather-normalized demand primarily due to pandemic impacts. Also
contributing to lower earnings was higher depreciation expense from
infrastructure investments, severance and advisor expenses, and
higher interest expense; partially offset by lower operating and
maintenance expenses.
Evergy’s 2020 adjusted earnings (non-GAAP) and adjusted earnings
per share (non-GAAP) were $706 million and $3.10, respectively,
compared to $694 million and $2.89 in 2019, representing a
year-over-year increase of 7%, in line with the company’s target of
6% to 8% annual growth in adjusted EPS from 2019-2024. Fourth
quarter adjusted earnings (non-GAAP) were $64 million, or $0.28 per
share, compared with $73 million and $0.32 per share in the fourth
quarter of 2019. Adjusted earnings (non-GAAP) and adjusted earnings
per share (non-GAAP) are reconciled to GAAP earnings in the
financial table included in this release.
For the year, adjusted (non-GAAP) earnings per share were driven
higher primarily by lower operations and maintenance expense due to
continued cost management and fewer shares outstanding. These
benefits were partially offset by unfavorable weather, lower demand
due to the impacts of the pandemic, higher depreciation expense,
and higher interest expense.
“I’m very excited to be part of the Evergy team and to welcome
Kirk Andrews, our new Chief Financial Officer,” said David
Campbell, Evergy president and chief executive officer. “Our
executive team and employees remained laser-focused to deliver
strong financial results in 2020, despite the unprecedented
challenges. We also had solid operating performance in safety and
reliability, and we continued to find efficiencies throughout our
business. We have a tremendous opportunity in front of us with the
Sustainability Transformation Plan, which we expect to continue
driving long-term value for both customers and shareholders.”
2021 EPS Guidance
Evergy issued 2021 GAAP EPS guidance of $3.14 to $3.34 and
adjusted EPS guidance of $3.20 to $3.40. 2021 guidance does not
reflect the expected positive impact of power marketing activities
during the February extreme weather event.
Updates to Five-Year Capital
Plan
Evergy has updated its five-year capital plan to include $9.2
billion of infrastructure investments through 2025, as compared to
$8.9 billion through 2024. Including these additional investments,
Evergy continues to expect compounded annual rate base growth of 5%
to 6% from 2019 to 2024 as previously announced under the Company’s
Sustainability Transformation Plan.
Dividend Declaration
The Board of Directors declared a dividend on the company’s
common stock of $0.535 per share payable on March 22, 2021. The
dividends are payable to shareholders of record as of March 8,
2021.
Earnings Conference Call
Evergy management will host a conference call Friday, February
26, with the investment community at 8:00 a.m. ET (7:00 a.m. CT).
Investors, media and the public may listen to the conference call
by dialing (888) 353-7071, conference ID 5353707. A webcast of the
live conference call will be available at investors.evergy.com.
Members of the media are invited to listen to the conference
call and then contact Gina Penzig with any follow-up questions.
This earnings announcement, a package of detailed fourth-quarter
financial information, the Company's quarterly report on Form 10-K
for the period ended December 31, 2020 and other filings the
Company has made with the Securities and Exchange Commission (SEC)
are available on the Company's website at investors.evergy.com.
Adjusted Earnings (non-GAAP) and
Adjusted Earnings Per Share (non-GAAP)
Adjusted earnings (non-GAAP) and adjusted earnings per share
(non-GAAP) exclude costs resulting from rebranding, voluntary
severance, advisor expenses and the revaluation of deferred tax
assets and liabilities from the Kansas state income tax rate
change. This information is intended to enhance an investor's
overall understanding of results. Adjusted earnings (non-GAAP) and
adjusted earnings per share (non-GAAP) are used internally to
measure performance against budget and in reports for management
and the Evergy Board of Directors. Adjusted earnings (non-GAAP) and
adjusted earnings per share (non-GAAP) are financial measures that
are not calculated in accordance with GAAP and may not be
comparable to other companies' presentations or more useful than
the GAAP information provided elsewhere in this report.
The following tables provide a reconciliation between net income
attributable to Evergy, Inc. and diluted earnings per common share
as determined in accordance with GAAP and adjusted earnings
(non-GAAP) and adjusted earnings per share (non-GAAP).
Evergy, Inc
Consolidated Earnings and
Diluted Earnings Per Share
(Unaudited)
Earnings (Loss)
Earnings (Loss) per Diluted
Share
Earnings (Loss)
Earnings (Loss) per Diluted
Share
Three Months Ended December 31
2020
2019
(millions, except per share
amounts)
Net income attributable to
Evergy, Inc.
$
51.0
$
0.22
$
63.9
$
0.28
Non-GAAP reconciling items:
Rebranding costs, pre-tax(a)
—
—
7.4
0.03
Voluntary severance costs,
pre-tax(b)
11.0
0.05
4.7
0.02
Advisor expenses, pre-tax(c)
6.2
0.03
—
—
Income tax benefit(d)
(4.4
)
(0.02
)
(3.2
)
(0.01
)
Adjusted earnings (non-GAAP)
$
63.8
$
0.28
$
72.8
$
0.32
Earnings (Loss)
Earnings (Loss) per Diluted
Share
Earnings (Loss)
Earnings (Loss) per Diluted
Share
Year Ended December 31
2020
2019
(millions, except per share
amounts)
Net income attributable to
Evergy, Inc.
$
618.3
$
2.72
$
669.9
$
2.79
Non-GAAP reconciling items:
Rebranding costs, pre-tax(a)
—
—
12.1
0.05
Voluntary severance costs,
pre-tax(b)
66.3
0.29
19.8
0.08
Advisor expenses, pre-tax(c)
32.3
0.14
—
—
Income tax benefit(d)
(25.2
)
(0.11
)
(7.8
)
(0.03
)
Kansas corporate income tax
change(e)
13.8
0.06
—
—
Adjusted earnings (non-GAAP)
$
705.5
$
3.10
$
694.0
$
2.89
(a)
Reflects external costs incurred to
rebrand the legacy Westar Energy and KCP&L utility brands to
Evergy and are included in operating and maintenance expense on the
consolidated statements of comprehensive income.
(b)
Reflects severance costs incurred
associated with certain voluntary severance programs at the Evergy
Companies and are included in operating and maintenance expense on
the consolidated statements of comprehensive income.
(c)
Reflects advisor expenses incurred
associated with strategic planning and are included in operating
and maintenance expense on the consolidated statements of
comprehensive income.
(d)
Reflects an income tax effect calculated
at a statutory rate of approximately 26%, with the exception of
certain non-deductible items.
(e)
Reflects the revaluation of Evergy Kansas
Central's, Evergy Metro's and Evergy Missouri West's deferred
income tax assets and liabilities from the Kansas corporate income
tax rate change and are included in income tax expense on the
consolidated statements of comprehensive income.
GAAP to Non-GAAP Earnings
Guidance
Earnings per Diluted
Share Guidance
2021 Net income attributable to Evergy,
Inc.
$3.14 - $3.34
Non-GAAP reconciling items:
Advisor expense, pre-tax(a)
0.05
Executive transition cost, pre-tax(b)
0.03
Income tax benefit(c)
(0.02)
2021 Adjusted earnings
(non-GAAP)
$3.20 - $3.40
(a)
Reflects our advisor expense incurred
associated with strategic planning.
(b)
Reflects costs associated with certain
executive transition costs at the Evergy Companies.
(c)
Reflects an income tax effect calculated
at a statutory rate of approximately 26% with the exception of
certain non-deductible items.
About Evergy
Evergy, Inc. (NYSE: EVRG), through its operating subsidiaries
Evergy Metro and Evergy Kansas Central, provides clean, safe and
reliable energy to 1.6 million customers in Kansas and Missouri.
The 2018 combination of KCP&L and Westar Energy to form Evergy
created a leading energy company that provides value to
shareholders and a stronger company for customers.
Evergy’s mission is to empower a better future. Today, about
half the power supplied to homes and businesses by Evergy comes
from emission-free sources, creating more reliable energy with less
impact to the environment. We will continue to innovate and adopt
new technologies that give our customers better ways to manage
their energy use.
For more information about Evergy, visit us at
www.evergy.com.
Forward Looking
Statements
Statements made in this release that are not based on historical
facts are forward-looking, may involve risks and uncertainties, and
are intended to be as of the date when made. Forward-looking
statements include, but are not limited to, statements relating to
our strategic plan, including, without limitation, those related to
earnings per share, dividend, operating and maintenance expense and
capital investment goals; the outcome of legislative efforts and
regulatory and legal proceedings; future energy demand; future
power prices; plans with respect to existing and potential future
generation resources; the availability and cost of generation
resources and energy storage; target emissions reductions; and
other matters relating to expected financial performance or
affecting future operations. Forward-looking statements are often
accompanied by forward-looking words such as “anticipates,”
“believes,” “expects,” “estimates,” “forecasts,” “should,” “could,”
“may,” “seeks,” “intends,” “proposed,” “projects,” “planned,”
“target,” “outlook,” “remain confident,” “goal,” “will” or other
words of similar meaning. Forward-looking statements involve risks,
uncertainties and other factors that could cause actual results to
differ materially from the forward-looking information.
In connection with the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995, Evergy, Inc., Evergy
Kansas Central, Inc. and Evergy Metro, Inc. (collectively, the
Evergy Companies) are providing a number of risks, uncertainties
and other factors that could cause actual results to differ from
the forward-looking information. These risks, uncertainties and
other factors include, but are not limited to: economic and weather
conditions and any impact on sales, prices and costs; changes in
business strategy or operations; the impact of federal, state and
local political, legislative, judicial and regulatory actions or
developments, including deregulation, re-regulation, securitization
and restructuring of the electric utility industry; decisions of
regulators regarding, among other things, customer rates and the
prudency of operational decisions such as capital expenditures and
asset retirements; changes in applicable laws, regulations, rules,
principles or practices, or the interpretations thereof, governing
tax, accounting and environmental matters, including air and water
quality and waste management and disposal; the impact of climate
change, including increased frequency and severity of significant
weather events and the extent to which counterparties are willing
to do business with, finance the operations of or purchase energy
from the Evergy Companies due to the fact that the Evergy Companies
operate coal-fired generation; prices and availability of
electricity in wholesale markets; market perception of the energy
industry and the Evergy Companies; the impact of the Coronavirus
(COVID-19) pandemic on, among other things, sales, results of
operations, financial condition, liquidity and cash flows, and also
on operational issues, such as the availability and ability of our
employees and suppliers to perform the functions that are necessary
to operate the Evergy Companies; changes in the energy trading
markets in which the Evergy Companies participate, including
retroactive repricing of transactions by regional transmission
organizations (RTO) and independent system operators; financial
market conditions and performance, including changes in interest
rates and credit spreads and in availability and cost of capital
and the effects on derivatives and hedges, nuclear decommissioning
trust and pension plan assets and costs; impairments of long-lived
assets or goodwill; credit ratings; inflation rates; the transition
to a replacement for the London Interbank Offered Rate (LIBOR)
benchmark interest rate; effectiveness of risk management policies
and procedures and the ability of counterparties to satisfy their
contractual commitments; impact of physical and cybersecurity
breaches, criminal activity, terrorist attacks and other
disruptions to the Evergy Companies’ facilities or information
technology infrastructure or the facilities and infrastructure of
third-party service providers on which the Evergy Companies rely;
ability to carry out marketing and sales plans; cost, availability,
quality and timely provision of equipment, supplies, labor and
fuel; ability to achieve generation goals and the occurrence and
duration of planned and unplanned generation outages; delays and
cost increases of generation, transmission, distribution or other
projects; the Evergy Companies’ ability to manage their
transmission and distribution development plans and transmission
joint ventures; the inherent risks associated with the ownership
and operation of a nuclear facility, including environmental,
health, safety, regulatory and financial risks; workforce risks,
including those related to the Evergy Companies’ ability to attract
and retain qualified personnel, maintain satisfactory relationships
with their labor unions and manage costs of, or changes in,
retirement, health care and other benefits; disruption, costs and
uncertainties caused by or related to the actions of individuals or
entities, such as activist shareholders or special interest groups,
that seek to influence our strategic plan, financial results or
operations; the possibility that strategic initiatives, including
mergers, acquisitions and divestitures, and long-term financial
plans, may not create the value that they are expected to achieve
in a timely manner or at all; difficulties in maintaining
relationships with customers, employees, regulators or suppliers;
and other risks and uncertainties.
This list of factors is not all-inclusive because it is not
possible to predict all factors. Additional risks and uncertainties
are discussed from time to time in current, quarterly and annual
reports filed by the Evergy Companies with the Securities and
Exchange Commission (SEC). Reports filed by the Evergy Companies
with the SEC should also be read for more information regarding
risk factors. Each forward-looking statement speaks only as of the
date of the particular statement. The Evergy Companies undertake no
obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise, except as required by law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20210226005124/en/
Investor Contact: Cody VandeVelde Director, Investor
Relations Phone: 785-575-8227 Cody.VandeVelde@evergy.com
Media Contact: Gina Penzig Manager, External
Communications Phone: 785-575-8089 Gina.Penzig@evergy.com Media
line: 888-613-0003
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