Unitil (UTL) Q3 2024 earnings summary

Executive summary

• Year-to-date GAAP net income reached $31.5 million ($1.96/share), up $1.8 million or $0.11/share year-over-year; adjusted net income was $32.1 million ($2.00/share), up $2.4 million, excluding Bangor transaction costs.

• Q3 2024 net income was breakeven or $1.4 million ($0.09/share), flat or down $1.4 million year-over-year; adjusted Q3 net income was $0.4 million ($0.02/share), down $1.0 million.

• Regulatory progress includes Granite State Gas settlement and the planned acquisition of Bangor Natural Gas for $70.9 million, expected to close by Q1 2025.

• Reaffirmed long-term EPS growth target of 5%-7% and rate base growth of 6.5%-8.5%; dividend payout ratio targeted at 55%-65%.

• Majority of customers under decoupled rates, supporting margin stability.

Financial highlights

• Year-to-date adjusted gross margin increased $10.8 million, with electric margin at $81.7 million (+$1.6 million) and gas margin at $115.6 million (+$9.2 million).

• Q3 2024 operating revenue was $92.9 million (down 10.6%); nine-month revenue was $367.3 million (down 14.1%).

• Operation and maintenance expenses rose $1.1 million year-to-date, mainly from higher labor and utility costs.

• Depreciation and amortization increased $5.1 million year-to-date due to higher plant in service and rates.

• Interest expense increased $1 million year-to-date due to higher borrowings.

Outlook and guidance

• Long-term EPS growth guidance of 5%-7% and rate base growth of 6.5%-8.5% reaffirmed; 2024 earnings expected within long-term range.

• Dividend payout ratio expected between 55%-65%.

• Projected capital spending through 2028 totals $910 million, 47% higher than the prior five years.

• O&M growth anticipated at or below inflation for 2024.

• Management expects continued earnings growth driven by rate increases, customer growth, and capital investment.