Eversource Energy

Reported Q2 2020 GAAP EPS was $0.14, versus $0.96 in the second quarter of 2020. GAAP results included a $111.4 million after-tax charge, or $0.30 per share, for the Aquarion carrying value and a $164 million after-tax charge, or $0.43 per share, for Revolution Wind contingent liability. Excluding those items, recurring EPS was $0.87, down from $0.96 a year ago. Management reaffirmed 2026 non-GAAP EPS guidance of $4.52 to $4.72 and said long-term EPS growth should be 5% to 7% through 2028, with growth trending toward the upper half by then. The 5-year capital plan remains $21.5 billion, and equity needs over that period remain $800 million to $1.1 billion, with no equity issuance expected for the rest of 2020. Connecticut storm-cost recovery approved approximately $870 million of roughly $975 million requested, with about $670 million expected to be securitized after already recovered amounts; New Hampshire has about $450 million of storm costs still awaiting final approval.

Joe Nolan emphasized execution on three priorities: selling Aquarion, strengthening the balance sheet, and advancing regulated infrastructure investment. He said the company is becoming a pure-play regulated pipes-and-wires utility and argued that New England needs more transmission and generation to improve affordability and reliability. His tone was constructive and confident, especially around Connecticut rate recovery, the transmission RFP, and Revolution Wind, which he said is nearly complete.

John Moreira focused on the quarter’s charge items, noting GAAP EPS was affected by the Aquarion and Revolution Wind charges, while recurring EPS of $0.87 reflected lower transmission and gas earnings partly offset by higher electric distribution revenue. He highlighted financing progress from the $1.7 billion Aquarion proceeds, said equity needs remain $800 million to $1.1 billion over five years, and reiterated no equity issuance for the rest of 2020. He also pointed to FFO-to-debt ratios of 14.3% and 15.7% versus S&P and Moody’s thresholds, the reaffirmed $21.5 billion capital plan, and 2026 EPS guidance of $4.52 to $4.72.

Analysts pressed on the Connecticut storm decision, especially the denial of carrying charges, and management said the ruling was constructive overall because it gives them a path to securitize nearly $700 million. Questions also focused on the new Connecticut rate case, where management stressed that only 11% of the request is O&M and that the rest is mainly capex, resiliency, depreciation, and taxes. On transmission, management said the ISO New England process should become clearer by the third-quarter call, and on AMI in Connecticut they said they are seeking an expedited decision this fall so they can preserve vendor pricing and begin work next year.