- GAAP EPS of $0.81; Adjusted EPS (Non-GAAP) of $0.85
- Declares quarterly dividend of $0.535
- Reaffirms 2021 adjusted earnings guidance
Evergy, Inc. (NYSE: EVRG) today announced second quarter 2021
earnings of $185 million, or $0.81 per share, compared with
earnings of $133 million, or $0.59 per share, for the second
quarter of 2020.
Evergy’s adjusted earnings (non-GAAP) and adjusted earnings per
share (non-GAAP) were $195 million and $0.85, respectively, in the
second quarter of 2021 compared with $154 million and $0.68,
respectively, in the second 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.
Second quarter earnings per share were driven higher primarily
by higher weather-normalized demand, higher transmission margin,
lower operating and maintenance expense and higher other income,
partially offset by unfavorable weather.
“Strong financial and operational execution allowed our team to
deliver solid results in the first half of the year. We also
completed a number of significant milestones, including the
announcement of our Integrated Resource Plan (IRP), which outlines
and accelerates the company’s carbon reduction timeline, the
completion of Sustainability Transformation Plan workshops in both
Kansas and Missouri, and the passage of securitization legislation
in both states,” said David Campbell, Evergy president and chief
executive officer. “We will remain focused on execution in order to
capitalize on this strong momentum.”
Earnings Guidance
The Company has reaffirmed 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 September 20, 2021. The
dividends are payable to shareholders of record as of August 20,
2021.
Earnings Conference Call
Evergy management will host a conference call Thursday, August
5, 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 3065454. A webcast of the
live conference call will be available at
http://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 second-quarter
financial information, the Company's quarterly report on Form 10-Q
for the period ended June 30, 2021 and other filings the Company
has made with the Securities and Exchange Commission are available
on the Company's website at http://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,
advisor expenses and the revaluation of deferred tax assets and
liabilities from the Kansas corporate income tax rate change. This
information is intended to enhance an investor's overall
understanding of results. Management believes that adjusted
earnings (non-GAAP) provide a meaningful basis for evaluating
Evergy's operations across periods because it excludes certain
items that management does not believe are indicative of Evergy's
ongoing performance. 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 June 30
2021
2020
(millions, except per share
amounts)
Net income attributable to Evergy,
Inc.
$
185.3
$
0.81
$
133.4
$
0.59
Non-GAAP reconciling items:
Non-regulated energy marketing margin
related to February 2021 winter weather event, pre-tax(a)
1.5
0.01
—
—
Non-regulated energy marketing costs
related to February 2021 winter weather event, pre-tax(b)
2.0
0.01
—
—
Executive transition costs, pre-tax(c)
1.8
0.01
—
—
Severance costs, pre-tax(d)
1.2
—
(0.4
)
—
Advisor expenses, pre-tax(e)
5.7
0.02
9.8
0.04
Income tax benefit(f)
(2.4
)
(0.01
)
(2.4
)
(0.01
)
Kansas corporate income tax change(g)
—
—
13.8
0.06
Adjusted earnings (non-GAAP)
$
195.1
$
0.85
$
154.2
$
0.68
Earnings (Loss)
Earnings (Loss) per Diluted
Share
Earnings (Loss)
Earnings (Loss) per Diluted
Share
Year to Date June 30
2021
2020
(millions, except per share
amounts)
Net income attributable to Evergy,
Inc.
$
376.9
$
1.65
$
202.8
$
0.89
Non-GAAP reconciling items:
Non-regulated energy marketing margin
related to February 2021 winter weather event, pre-tax(a)
(95.0
)
(0.42
)
—
—
Non-regulated energy marketing costs
related to February 2021 winter weather event, pre-tax(b)
4.0
0.02
—
—
Executive transition costs, pre-tax(c)
7.3
0.03
—
—
Severance costs, pre-tax(d)
2.8
0.01
26.6
0.12
Advisor expenses, pre-tax(e)
7.2
0.03
16.4
0.07
Income tax expense (benefit)(f)
17.3
0.08
(11.2
)
(0.05
)
Kansas corporate income tax change(g)
—
—
13.8
0.06
Adjusted earnings (non-GAAP)
$
320.5
$
1.40
$
248.4
$
1.09
(a)
Reflects non-regulated energy marketing
margins related to the February 2021 winter weather event 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 February 2021 winter
weather event 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.
(g)
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.
$3.43 - $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
http://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
Evergy’s 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 the
Evergy Companies’ 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/20210805005109/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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