The Southern Company Q1 FY2023 Earnings Call

· Earnings call transcript and AI-powered summary

Financial Performance

  • Adjusted EPS for Q1 2023 was $0.79, down $0.18 from Q1 2022 but $0.09 above internal estimates.
  • The year-over-year decline was primarily due to unusually warm weather (warmest Q1 on record in the Southeast), higher depreciation and amortization, and increased interest expense.
  • Compared to expectations, results were supported by strong natural gas utility performance and continued customer growth.
  • Weather's negative impact was largely anticipated, limiting its effect on the quarter’s variance from plan.
  • Retail electric sales (weather-normalized) increased 0.4% versus Q1 2022, supported by:
    • Strong residential and commercial sectors driven by in‑migration and a healthy labor market.
  • Industrial sales declined 1.6% versus Q1 2022, with half of the decline driven by the closure of a large caustic soda facility. Excluding that customer, industrial sales were down 0.8%.
  • The company reaffirmed its ability to manage early‑year weather impacts and expects normal weather for the rest of 2023.

Dividend Update

  • The Board approved an $0.08 annualized dividend increase, raising the annual rate to $2.80.
  • This marks the 22nd consecutive annual dividend increase and 76 consecutive years of equal or higher dividends.

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Operator: Good afternoon. My name is Kathy, and I will be your conference operator today. At this time, I would like to welcome everyone to The Southern Company First Quarter 2023 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded, Thursday, April 27, 2023. I would now like to turn the conference over to Mr. Scott Gammill, Vice President, Investor Relations and Treasurer. Please go ahead, sir. Scott Gammill : Thank you, Kathy. Good afternoon, and welcome to Southern Company's First Quarter 2023 Earnings Call. Joining me today are Chris Womack, President of Southern Company; and Dan Tucker, Chief Financial Officer. Let me remind you, we'll be making forward-looking statements today in addition to providing historical information. Various important factors could cause actual results to differ materially from those indicated in the forward-looking statements. including those discussed in our Form 10-K, Form 10-Q and subsequent filings. In addition, we will present non-GAAP financial information on this call. Reconciliations to the applicable GAAP measure are included in the financial information we released this morning as well as the slides for this conference call, which are both available on our Investor Relations website at investor.southerncompany.com. At this time, I'll turn the call over to Chris Womack. Christopher Womack : Thank you, Scott, and good afternoon, and thank you for joining us. I am delighted to be joining you today on m

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