American Electric Power Company, Inc. Q2 FY2023 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Highlights

  • Q2 2023 operating earnings were $1.13 per share (down from $1.20 in Q2 2022).
  • GAAP earnings were $1.01 per share (slightly down from $1.02 in Q2 2022).
  • Management reaffirmed full‑year 2023 operating earnings guidance of $5.19–$5.39 per share (midpoint $5.29).
  • Long-term operating earnings growth target remains at 6% to 7% per year.

Performance Drivers (Compared to Q2 2022)

  • Weather reduced year‑over‑year EPS by $0.29 year‑to‑date and $0.20 versus normal.
  • Interest expense increased due to heavier debt loads and higher interest rates.
  • Unfavorable O&M in first half, but expected to reverse in the second half.
  • Rate increases and growth in transmission revenues offset some negative drivers.

Segment Performance (EPS YoY)

  • Vertically Integrated Utilities: $0.51 (down $0.08). Drivers included favorable rates, depreciation, and off‑system sales; offset by weather, interest, O&M, and lower load.
  • Transmission & Distribution Utilities: $0.30 (down $0.02). Higher transmission revenues and rate changes offset by weather and lower load.
  • AEP Transmission Holdco: $0.38 (up $0.11). Driven by investment growth and favorable true‑ups.

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Operator: Ladies and gentlemen, thank you for standing by and welcome to the American Electric Power Second Quarter 2023 Conference Call. At this time, all parties are in a listen-only mode. Later, we will conduct a question-and-answer session. [Operator Instructions] This call is being recorded. I'd now like to turn the conference over to our host, Vice President of Investor Relations, Ms. Darcy Reese. Please go ahead. Darcy Reese: Thank you, Brad. Good morning everyone, and welcome to the second quarter 2023 earnings call for American Electric Power. We appreciate you taking time today to join us. Our earnings release, presentation slides and related financial information are available on our website at aep.com. Today, we will be making forward-looking statements during the call. There are many factors that may cause future results to differ materially from these statements. Please refer to our SEC filings for a discussion of these factors. Joining me this morning for opening remarks are Julie Sloat, our President and Chief Executive Officer; and Ann Kelly, our Chief Financial Officer. We will take your questions following their remarks. I will now turn the call over to Julie. Julie Sloat: Thanks Darcy. Welcome everyone to American Electric Power's second quarter 2023 earnings call. Good to be with everyone this morning. It's a rapid time of change in our industry with new opportunities resulting from federal policy shifts and evolving state and customer priorities. We also

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