American Electric Power Company (AEP) Q2 2024 earnings summary

Executive summary

• Q2 2024 operating earnings were $1.25 per share ($662M), up 12% year-over-year, while GAAP earnings were $0.64 per share ($340M), impacted by non-operating items such as customer refunds and severance costs.

• 2024 operating earnings guidance reaffirmed at $5.53–$5.73 per share, with a long-term growth target of 6%–7%.

• Commercial load growth reached 12.4% year-over-year in Q2, driven by data center demand and over 15 GW of incremental load commitments by 2030.

• Bill Fehrman will become CEO effective August 1, 2024, ensuring continuity in strategic direction.

• Positive regulatory progress with base case approvals and settlements in multiple states; ongoing cases and regulatory actions continue.

Financial highlights

• Q2 2024 operating earnings were $1.25 per share ($662M), up from $1.13 per share ($582M) last year; GAAP EPS was $0.64, down from $1.01.

• Year-to-date 2024 operating earnings reached $2.52 per share ($1.33B), up from $2.24 per share ($1.15B); GAAP EPS was $2.55 ($1.34B), up from $1.78 ($918M).

• Q2 2024 consolidated revenues were $4.6B, up from $4.4B in Q2 2023.

• GAAP earnings impacted by $126M–$160M after-tax provision for customer refunds, $94M–$122M voluntary severance expense, and $111M EPA compliance accrual.

• Weather-normalized retail sales up 4% year-over-year, with commercial sales up 12.4% and T&D commercial load up over 20%.

Outlook and guidance

• 2024 operating earnings guidance reaffirmed at $5.53–$5.73 per share; long-term growth rate target remains 6%–7%.

• Capital plan of $43B for 2024–2028, with 100% allocated to regulated businesses and 22% to renewables.

• Significant incremental load growth expected, with over 15 GW of data center commitments by 2030.

• Update on capital spend and financing for large load growth to be provided in the fall.

• Rate base CAGR projected at 7.2% over the forecast period; average customer rates expected to rise ~3% annually.