First Quarter Non-GAAP EPS: Reported at $0.55 for the first quarter of 2024.
Growth Over Previous Year: This represents an increase from the first quarter of 2023’s non-GAAP EPS of $0.50.
Rate Recovery: A significant factor in the quarter’s performance, contributing $0.09 to the earnings, primarily due to ongoing recovery from various interim mechanisms and interim rates in the Minnesota gas business effective from January 1, 2024.
Organic Growth: Continues in the Houston area with 1% to 2% average annual customer growth.
Weather and Usage Impact: Favorable variance of $0.02 compared to Q1 of 2023, despite mild weather conditions.
Interest and O&M Expenses: Reported increases in operating and maintenance (O&M) expenses by $0.02 and interest expense by $0.04, partially offset by the savings from the redemption of Series A preferred shares.
Future Guidance
Full Year 2024 Non-GAAP EPS Guidance: Reaffirmed in the range of $1.61 to $1.63, representing 8% growth at the midpoint from the 2023 actual results of $1.50 per share.
Long-term Growth: Expects to grow non-GAAP EPS at the mid- to high end of the 6% to 8% range annually through 2030, with dividend per share growth aligned with EPS growth over the same period.
Capital Expenditure Targets for 2024: Set at $3.7 billion, with $800 million already invested in Q1.
Ten-Year Capital Plan: Increased to $44.5 billion; potential incremental increase to $45 billion if resiliency plan investments are approved, targeting nearly 10% rate base CAGR through 2030.
Interest Expense and Financing Plans: Interest expense increased due to new debt issuances; no changes anticipated in current financing plans shared with rating agencies.
Trends, Market Conditions, Sentiment
Houston Electric’s Resiliency Plan Filing: Proposes investments of approximately $2.2 billion to $2.7 billion over 2025-2027 for grid resiliency, potentially increasing total capex to $45 billion by 2030.
Regulatory Developments: Positive developments in rate cases, with a focus on combining jurisdictions for Texas Gas and ongoing discussions in Minnesota and Indiana rate cases.
Organic Customer Growth: Houston area continues to experience significant growth, contributing to strong financial performance and underscoring the continued demand for CenterPoint’s services.
Notable Quotes
”This quarter is yet another illustration of why we believe we have one of the most tangible long-term growth plans in the industry.” - Jason Wells, CEO.
”In aggregate, our filing includes a range of investments of approximately $2.2 billion to $2.7 billion over the 3-year period of 2025 to 2027.” - Jason Wells, on Houston Electric resiliency investments.
”The first quarter of 2024 was yet another strong quarter of financial performance here at CenterPoint.” - Christopher Foster, CFO, summarizing Q1 results.
”We have confidence in our ability to achieve this [keeping customer delivery charges modest], given the size of Houston Electric’s customer base and the underlying tremendous organic growth.” - Christopher Foster, on managing customer costs amidst growth initiatives.
