- GAAP EPS of $0.84; Adjusted EPS (Non-GAAP) of $0.55
- Declares quarterly dividend of $0.535
- Raises 2021 GAAP earnings guidance; affirms 2021 adjusted
earnings guidance
Evergy, Inc. (NYSE: EVRG) today announced first quarter 2021
earnings of $192 million, or $0.84 per share, compared with
earnings of $69 million, or $0.31 per share, for the first quarter
of 2020.
Evergy’s adjusted earnings (non-GAAP) and adjusted earnings per
share (non-GAAP) were $125 million and $0.55, respectively, in the
first quarter of 2021 compared with $94 million and $0.41,
respectively, in the first quarter of 2020. Adjusted earnings
(non-GAAP) and adjusted earnings per share (non-GAAP) are
reconciled to GAAP earnings in the financial table included in this
release.
First quarter earnings per share were driven higher primarily by
favorable power marketing margins gained during the February winter
weather event, which also favorably impacted retail sales compared
to the prior year. Adjusted earnings exclude power marketing
margins gained during the February winter weather event, as well as
executive transition, severance, and advisor expenses.
“We are off to a solid start in 2021,” said David Campbell,
Evergy president and chief executive officer. “Our team continues
to execute – delivering strong financial results in the first
quarter and advancing several key regulatory and legislative
objectives.”
Net-Zero Carbon Goal
Evergy recently announced its Integrated Resource Plan (IRP),
which outlines and accelerates the company’s carbon reduction
timeline. Evergy plans to add 3,200 megawatts of renewable
generation and retire nearly 1,200 megawatts of coal-based
generation in the next 10 years. The plan balances sustainability,
reliability, and affordability, and outlines Evergy’s goal to
achieve net-zero carbon emissions by 2045, enabled by a combination
of supportive energy policies and ongoing technology developments.
As part of the plan, Evergy also announced an interim target to
reduce its carbon emissions 70 percent by 2030, relative to 2005
levels.
“Our net-zero carbon emission goal establishes a vision of
accelerating our transition toward cleaner energy, benefitting our
customers, communities and stakeholders,” said Campbell. “Reducing
carbon emissions and increasing renewable energy benefits our
customers by reducing operating costs and by making our operations
more environmentally sustainable. The growth of renewable energy
will bring economic benefits to our region through cost-competitive
generation and investment in rural communities. Our plan will also
assist our customers in meeting their own sustainability
goals.”
Earnings Guidance
Evergy has raised its 2021 GAAP EPS guidance range to $3.43 to
$3.63, from $3.14 to $3.34 primarily due to the impact of favorable
power marketing margins gained during the February winter weather
event, which the Company has excluded from its adjusted earnings.
The Company has affirmed its 2021 adjusted EPS guidance range of
$3.20 to $3.40 and long-term adjusted EPS annual growth target of
6% to 8% from 2019 through 2024.
Dividend Declaration
The Board of Directors declared a dividend on the Company’s
common stock of $0.535 per share payable on June 21, 2021. The
dividends are payable to shareholders of record as of May 21,
2021.
Earnings Conference Call
Evergy management will host a conference call Thursday, May 6,
with the investment community at 9:00 a.m. ET (8:00 a.m. CT).
Investors, media and the public may listen to the conference call
by dialing (888) 353-7071, conference ID 4792188. 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 first-quarter
financial information, the Company's quarterly report on Form 10-Q
for the period ended March 31, 2021 and other filings the Company
has made with the Securities and Exchange Commission 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 the income or costs resulting from non-regulated
energy marketing margins from the February 2021 winter weather
event, and costs resulting from executive transition, severance,
and advisor expenses. 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 March 31
2021
2020
(millions, except per share
amounts)
Net income attributable to Evergy,
Inc.
$
191.6
$
0.84
$
69.4
$
0.31
Non-GAAP reconciling items:
Non-regulated energy marketing margin
related to winter weather event, pre-tax(a)
(96.5
)
(0.42
)
—
—
Non-regulated energy marketing costs
related to winter weather event, pre-tax(b)
2.0
0.01
—
—
Executive transition costs, pre-tax(c)
5.5
0.02
—
—
Severance costs, pre-tax(d)
1.6
0.01
27.0
0.12
Advisor expenses, pre-tax(e)
1.5
0.01
6.6
0.02
Income tax expense (benefit)(f)
19.7
0.08
(8.8
)
(0.04
)
Adjusted earnings (non-GAAP)
$
125.4
$
0.55
$
94.2
$
0.41
(a)
Reflects non-regulated energy marketing
margins related to the winter weather event in February 2021 and
are included in operating revenues on the consolidated statements
of comprehensive income.
(b)
Reflects non-regulated energy marketing
incentive compensation costs related to the winter weather event in
February 2021 and are included in operating and maintenance expense
on the consolidated statements of comprehensive income.
(c)
Reflects costs associated with executive
transition including inducement bonuses, severance agreements and
other transition expenses and are included in operating and
maintenance expense on the consolidated statements of comprehensive
income.
(d)
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.
(e)
Reflects advisor expenses incurred
associated with strategic planning and are included in operating
and maintenance expense on the consolidated statements of
comprehensive income.
(f)
Reflects an income tax effect calculated
at a statutory rate of approximately 22% in 2021 and 26% in 2020,
with the exception of certain non-deductible items.
GAAP to Non-GAAP Earnings
Guidance
Earnings per Diluted
Share
Guidance
2021 Net income attributable to Evergy,
Inc.
$3.43 - $3.63
Non-GAAP reconciling items:
Non-regulated energy marketing margin
related to winter weather event(a)
(0.42)
Non-regulated energy marketing costs
related to winter weather event(b)
0.03
Executive transition costs(c)
0.03
Severance costs(d)
0.01
Advisor expenses(e)
0.05
Income tax expense (benefit)(f)
0.07
2021 Adjusted earnings
(non-GAAP)
$3.20 - $3.40
(a)
Reflects non-regulated energy marketing
margins related to the winter weather event in February 2021 and
are included in operating revenues on the consolidated statements
of comprehensive income.
(b)
Reflects non-regulated energy marketing
incentive compensation costs related to the winter weather event in
February 2021 and are included in operating and maintenance expense
on the consolidated statements of comprehensive income.
(c)
Reflects costs associated with executive
transition including inducement bonuses, severance agreements and
other transition expenses and are included in operating and
maintenance expense on the consolidated statements of comprehensive
income.
(d)
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.
(e)
Reflects advisor expenses incurred
associated with strategic planning and are included in operating
and maintenance expense on the consolidated statements of
comprehensive income.
(f)
Reflects an income tax effect calculated
at a statutory rate of approximately 22% in 2021, with the
exception of certain non-deductible items.
About Evergy
Evergy, Inc. (NYSE: EVRG), 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, 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
investors.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 Evergy’s 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/20210506005188/en/
Investor Contact: Cody VandeVelde Director, Investor
Relations Phone: 785-575-8227 Cody.VandeVelde@evergy.com Media
Contact: Gina Penzig Manager, External Communications Phone:
785-508-2410 Gina.Penzig@evergy.com Media line: 888-613-0003
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