Emera Incorporated

Good morning, ladies and gentlemen, and welcome to the EMERA Inc. Fourth Quarter 2024 and Annual Financial Results Conference Call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. I would now like to turn the conference call over to Dave Pleasanson. Vice President of Investor Relations. Please go ahead.

Thank you, Jenny, and thank you all for joining us this morning for AMIRA's fourth quarter 2024 conference call and live webcast. AMIRA's fourth quarter earnings release was distributed this morning via Newswire, and the financial statements, management's discussion and analysis, and the presentation being referenced on this call are available on our website at AMIRA.com. Joining me for this morning's call are Scott Balfour, AMIRA's President and Chief Executive Officer, Greg Blunden, AMIRA's Chief Financial Officer and other members of AMIRA's management team. Before we begin, I'd like to advise you that this morning's discussion will include forward-looking information, which is subject to the cautionary statement contained in the supporting slide. Today's discussion and presentation will also include references to non-GAAP financial measures. You should refer to the Appendix for Reconciliations of Historical Non-GAAP Measures to the closest GAAP financial measure. And now, I will turn things over to Scott.

Thank you, Dave, and good morning, everyone. And you'll have to forgive me this morning, I am sporting the tail end of a cold, so voice isn't quite what it is, and I may have to take a break for a cough. This morning we reported annual adjusted earnings per share of $2.94. This is in line with both our 2023 adjusted earnings per share of $2.96 and and the benchmark for adjusted EPS growth guidance we shared last year. Our 2024 results were bolstered by a strong fourth quarter where higher contributions from regulated utilities and lower corporate costs drove a 33% increase in quarterly adjusted earnings per share. Our portfolio of premium utilities located predominantly in Florida continues to show strong growth. Earnings contributions have been increasing. as we continue to make rate-based investments to support the significant population and economic growth happening across our jurisdictions, as we continue to advance our reliability and resiliency efforts, and as we work to meet government-mandated decarbonization targets. Adjusted earnings contributions from our regulated utilities increased more than 24% quarter-over-quarter and 6% year-over-year, despite the impact of lost earnings from the sale of our equity interest in the Labrador Island Link. On 2024, it was a significant year of progress for Amira, and I'm proud of what we accomplished. We began the year with a strategic plan focused on driving long-term value for our shareholders to strengthen our balance sheet and credit ratings in order to reduce our cost of capital as we continue to pursue and invest in compelling growth opportunities across our portfolio. A key focus of this plan involved a disciplined asset sales process and an optimized approach to capital allocation, and we delivered. We achieved numerous milestones that advanced our plan. We began with a sale of our equity interest in the Labrador Island Link in June, and we followed with the announcement of the sale of New Mexico Gas in August, which we continue to expect will close later this year. We also securitized more than $600 million of unrecovered fuel costs at Nova Scotia Power. With these transactions, we more than doubled the expected proceeds from our asset sale program. Strategic reallocation of capital announced in June, including adjusting our dividend growth rate to 1% to 2%, allows us to direct more of our growing cash flow towards our robust capital investment opportunities. This action, coupled with a strong catalyst for growth, we continue to see across the business, and the constructive rate case outcomes achieved in 2024 reinforces our continuing confidence in our 5% to 7% average adjusted earnings per share growth through 2027. The constructive rate case outcomes we achieved in 2024 included New Mexico Gas reaching an unopposed settlement agreement in March, approving 30 million US dollars in new rates that went into effect on October 1st. And in December, The Florida Public Service Commission issued its final decision on the Tampa Electric rate application, approving more than 99% of Tampa Electric's capital and operating spend. This resulted in $185 US million of new base rates for 2025, based on a 10.5% allowed ROE, an increase of 30 basis points from the previous settlement. In addition, the Commission awarded subsequent year rate adjustments of $87 million in 2026 and additional $9 million in 2027 in support of capital projects completed after the test year. The stability provided by a multi-year rate plan enables the business to prioritize operational efficiency, which is critical to effectively managing costs for customers. This was a fair, balanced decision, which reflects the Commission's confidence in TAMP Electric to make wise capital investment decisions and to prudently manage costs for customers. In turn, this gives us confidence to continue investing the significant capital needed to support the region's growth and to continue to improve reliability and generating overall better outcomes for customers. Key indicators continue to show that Florida's economy is strong. Florida has the fastest growing population in the country, with even stronger growth in Hillsborough County projected over the next 10 years. In 2024, Florida was also the number one state for net migration, and its GDP grew to $1.7 trillion, a 4% increase over 2023. The growth in Florida, coupled with a growing desire for natural gas, has accelerated demand of people's gas at a rate of more than double the population growth. As a result, People's Gas expects to invest nearly $800 U.S. million in capital over the next two years to serve its existing and growing customer base with high levels of service and reliability. To support the demand of capital investment at the utility, a few weeks ago, People's Gas notified the Public Service Commission of its intention to file for 90 to 110 million U.S. dollars of new rates to be effective January 1st of 2026. They anticipate filing in March. I'm proud of what the teams have accomplished this year, safely deploying more than $3.2 billion in capital investment in 2024. This was our largest annual capital investment ever, resulting in roughly 7% rate-based growth year over year. Our capital plan continues to be focused on enhancing and expanding our infrastructure to deliver on customer needs today and in the future. Last year, Tampa Electric invested almost $2 billion Canadian of capital on behalf of its customers. More than 10% of that capital supported the storm protection plan, which is pretty consistent with our level of investment in the plan over the last few years. The value of these investments for customers was evident in the aftermath of the back-to-back hurricanes Helene and Milton, with less system damage and faster restoration timelines than what otherwise would have been experienced. Tampa Electric was recognized by the Edison Electric Institute for its impressive storm response effort. And despite these major storms, Tampa Electric still delivered another year of strong reliability performance in 2024 for its customers. To better support reliability and help manage customer costs, Tampa Electric continued to expand its solar fleet, adding an additional 100 megawatts of solar in 2024. This brought total solar capacity to more than 1,300 megawatts, or 19% of its generated capacity, and in 2024, 10% of Tampa Electric's energy came from the sun. Since we began investing in solar at Tampa Electric in 2027, these investments have saved customers more than $320 U.S. million in avoided fuel costs. People's gas, the roughly $450 million spent on capital in 2024, helped support customer growth and enhance fuel resilience. The resiliency was highlighted during the active 2024 hurricane season, where notwithstanding the devastation of these storms, fewer than 0.3% of customers experienced a gas service interruption, once again demonstrating the important role natural gas plays in the energy mix in Florida. People's Gas installed more than 500 million new miles of new main and service lines to service more than 18,000 new residential and commercial customers. That represents more than 4% customer growth. And at Nova Scotia Power, capital investment has been laser focused on improving reliability. Last year, the team at Nova Scotia Power completed more reliability projects and more tree trimming than ever before in the company's history. This included replacing roughly 3,000 poles and trimming more than 650 kilometers of trees. The value of this work for customers is clear. In 2024, Nova Scotia Power experienced its best reliability year in 30 years. On a weather normalized basis, Power was on more than 99.9% of the time in 2024, better than most across Atlantic Canada, and in fact, better than most across the country. Looking forward, we see incremental catalysts for growth in 2025 and beyond. In addition to the very strong rate-based growth driven by the economic and population growth across the jurisdictions, several key trends are converging to shape a new future for regulated utilities. Accelerating demand, an evolving grid, decarbonization, electrification, and the increasing need for resilience against weather-related events require unprecedented capital investment to deliver the reliable energy our customers expect. Our five-year plan reflects all of this, and we believe that the need for this kind of investment will continue to be necessary for the foreseeable future. We continue to manage the pace of capital investment, keeping affordability top of mind. Beyond what's embedded in our capital plan, We're exploring ways our utilities can support data center development in our jurisdictions. With low rates, strong reliability, and a supportive business environment, Florida is seen as an increasingly attractive location for data center investment, which would mean opportunities for Tampa Electric to service the load, as well as for People's Gas to provide required fuel for backup generation. In 2025, it seems clear we can expect our business to benefit from a strengthening US dollar. We're based on our current hedge position for the year. Every penny change drives a penny change in adjusted EPS. As a result of the favorable tailwinds we're seeing in our business, including foreign exchange, we expect our adjusted earnings per share growth over the three-year guidance period to be somewhat front-loaded. While we remain comfortable with our average 5% to 7% guidance over the three-year period, we'll be disappointed if we don't see adjusted EPS growth that exceeds that range in 2025. Before turning it over to Greg, I want to express my thanks to our team for their hard work and agility in 2024. We've unquestionably positioned Amira well for the future. We accomplished a lot in 2024, and I'm proud how the team continues to rise to the challenge and set a high bar to deliver for our customers and investors. Amira and its operating companies are well equipped to navigate the evolving landscape of the utility sector and to capitalize on emerging opportunities. And with that, I'll turn it over to Greg to take you through our financial results.