- Third quarter 2021 GAAP EPS of $1.95; Adjusted EPS (Non-GAAP)
of $1.98
- Increasing quarterly dividend 7%, to $0.5725 per share,
annualized to $2.29
- Raising and narrowing 2021 GAAP EPS Guidance to $3.71 to $3.81;
Adjusted EPS Guidance to $3.50 to $3.60
Evergy, Inc. (NYSE: EVRG) today announced third quarter 2021
earnings of $449 million, or $1.95 per share, compared with
earnings of $365 million, or $1.60 per share, for the third quarter
of 2020.
Evergy’s adjusted earnings (non-GAAP) and adjusted earnings per
share (non-GAAP) were $455 million and $1.98 per share,
respectively, in the third quarter of 2021 compared with $393
million and $1.73 per share, respectively, in the third 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.
Third quarter earnings per share were driven higher primarily by
higher retail sales from warmer weather, increased transmission
margin, higher other income, and lower income tax expense,
partially offset by a decrease in weather-normalized demand.
“We continue to execute on all elements of our strategy,
including investment in energy infrastructure and disciplined cost
management. This execution and favorable sales in the third
quarter, driven primarily by warm weather, have allowed us to raise
and narrow our 2021 adjusted earnings guidance range to $3.50 to
$3.60 per share from $3.20 to $3.40. We are also increasing our
fourth quarter dividend by seven percent, reflecting confidence in
the outlook of our business,” said David Campbell, Evergy president
and chief executive officer. “As we look ahead, we will remain
focused on executing our strategy and delivering benefits to all of
our stakeholders.”
Earnings Guidance
The Company raised and narrowed its 2021 adjusted EPS guidance
range to $3.50 to $3.60 from its original guidance range of $3.20
to $3.40. The Company affirmed its 2022 adjusted EPS guidance range
of $3.43 to $3.63, as well as its long-term adjusted EPS annual
growth target of 6% to 8% through 2025 from the $3.30 midpoint of
the original 2021 adjusted EPS guidance range.
Dividend Declaration
The Board of Directors declared a dividend on the Company’s
common stock of $0.5725 per share payable on December 20, 2021. The
dividends are payable to shareholders of record as of November 19,
2021.
Earnings Conference Call
Evergy management will host a conference call Wednesday,
November 3, 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 3955549. 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 third-quarter
financial information, the Company's quarterly report on Form 10-Q
for the period ended September 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 September 30
2021
2020
(millions, except per share
amounts)
Net income attributable to Evergy,
Inc.
$
449.4
$
1.95
$
364.5
$
1.60
Non-GAAP reconciling items:
Non-regulated energy marketing costs
related to February 2021
winter weather event, pre-tax(b)
1.9
0.01
—
—
Executive transition costs, pre-tax(c)
3.3
0.02
—
—
Severance costs, pre-tax(d)
—
—
28.7
0.13
Advisor expenses, pre-tax(e)
1.2
—
9.7
0.04
Income tax benefit(f)
(1.0
)
—
(9.6
)
(0.04
)
Adjusted earnings (non-GAAP)
$
454.8
$
1.98
$
393.3
$
1.73
Earnings (Loss)
Earnings (Loss) per Diluted
Share
Earnings (Loss)
Earnings (Loss) per Diluted
Share
Year to Date September 30
2021
2020
(millions, except per share
amounts)
Net income attributable to Evergy,
Inc.
$
826.3
$
3.60
$
567.3
$
2.49
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)
5.9
0.03
—
—
Executive transition costs, pre-tax(c)
10.6
0.05
—
—
Severance costs, pre-tax(d)
2.8
0.01
55.3
0.24
Advisor expenses, pre-tax(e)
8.4
0.04
26.1
0.12
Income tax expense (benefit)(f)
16.3
0.07
(20.8
)
(0.09
)
Kansas corporate income tax change(g)
—
—
13.8
0.06
Adjusted earnings (non-GAAP)
$
775.3
$
3.38
$
641.7
$
2.82
(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.
$3.71 - $3.81
Non-GAAP reconciling items:
Non-regulated energy marketing margin
related to winter weather event(a)
(0.41
)
Non-regulated energy marketing costs
related to winter weather event(b)
0.03
Executive transition costs(c)
0.05
Severance costs(d)
0.01
Advisor expenses(e)
0.04
Income tax expense (benefit)(f)
0.07
2021 Adjusted earnings
(non-GAAP)
$3.50 - $3.60
(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 document 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. You should also carefully consider
the information contained in our other filings with the Securities
and Exchange Commission (SEC). Additional risks and uncertainties
are discussed in the Annual Report on Form 10-K for the year ended
December 31, 2020 filed by the Evergy Companies with the SEC, and
from time to time in current reports on Form 8-K and quarterly
reports on Form 10-Q filed by the Evergy Companies with the SEC.
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/20211103005586/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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