Release Date: May 08, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Evergy Inc (EVRG, Financial) reported first quarter adjusted earnings of $0.54 per share, consistent with the previous year, driven by recovery of regulated investments.
• The company reaffirmed its 2025 adjusted EPS guidance range of $3.92 to $4.12 per share, with a midpoint of $4.02, and its long-term earnings growth target of 4% to 6% through 2029.
• Evergy Inc (EVRG) has a robust pipeline of large new customers, with significant potential demand growth from data centers and advanced manufacturing facilities.
• Constructive legislative outcomes in Kansas and Missouri enhance regulatory frameworks, supporting infrastructure investment and economic development.
• Operational performance was strong, with favorable SAIDI and SAIFI metrics and successful management of extreme weather conditions, demonstrating the reliability of Evergy Inc (EVRG)'s energy infrastructure.

Negative Points

• Lower industrial demand and higher interest and depreciation expenses partially offset the positive earnings impact from regulated investments.
• Sales were negatively impacted by two significant heavy snow events and an unplanned maintenance shutdown of a large industrial customer.
• The first quarter was slower than anticipated, with earnings approximately $0.05 below expectations before mitigating actions.
• Weather-normalized demand decreased by 3%, with residential demand showing a decline despite an increase in customer numbers.
• The company anticipates potential equity issuances in 2026 and 2027 to support its $17.5 billion capital plan, which could impact shareholder value.

Q & A Highlights

Q: Can you clarify the $0.05 shortfall in your earnings expectations for the quarter? A: David Campbell, Chairman and CEO, explained that the $0.05 shortfall is before mitigating actions. The company is actively working to address this gap and expects to meet the full-year EPS target of $4.02.

Q: What is the timing for signing contracts related to the 1.3 gigawatts of new projects? A: David Campbell noted that the timing is linked to finalizing large load power service tariff proceedings, expected by year-end. Announcements could precede the finalization of these tariffs, likely around the end of Q3 or into Q4.

Q: How could increased sales impact equity issuance needs? A: Bryan Buckler, CFO, stated that moving from a 2%-3% to a 4%-5% load growth could significantly reduce equity issuance needs, potentially by hundreds of millions over the five-year period, based on the $17.5 billion capital plan.

Q: Does the Integrated Resource Plan (IRP) account for the increased load growth? A: David Campbell confirmed that the latest IRP includes customers in the actively building and finalizing agreements categories, reflecting increased resource needs and some flexibility in retirement timelines.

Q: Can you discuss the rationale behind extending coal plant retirement dates? A: David Campbell explained that while there is flexibility, the age of the units and potential investment needs for environmental retrofits are factors. The company aims to maintain reliability while accommodating new large customer loads.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.