Canadian Utilities (CU) Q1 2025 earnings summary

Executive summary

• Q1 2025 adjusted earnings rose to $232 million ($0.85/share), up $7 million year-over-year, driven by regulated rate base growth, cost efficiencies, and strong EnPower storage revenues, while IFRS earnings attributable to equity owners were $236 million, down $6 million year-over-year due to timing adjustments and one-time items.

• Cash flows from operating activities increased to $637 million, up $135 million from Q1 2024, supporting ongoing capital investments.

• Major capital projects, including the Yellowhead Pipeline and Central East Transfer-Out Project, are advancing, with construction on Yellowhead expected to begin in 2026 and CETO supporting renewable integration.

• Revenues for Q1 2025 were $1,085 million, down $6 million year-over-year, mainly due to the sale of ATCO Energy, partially offset by regulated rate base growth and stronger natural gas storage spreads.

• Dividends paid totaled $125 million, with a quarterly dividend of $0.4577/share declared.

Financial highlights

• Adjusted earnings for Q1 2025 were $232 million, up from $225 million in Q1 2024; adjusted EPS was $0.85.

• IFRS earnings attributable to equity owners were $236 million for Q1 2025, compared to $242 million in Q1 2024.

• Cash flows from operating activities reached $637 million in Q1 2025, up from $502 million in Q1 2024.

• Capital expenditures for Q1 2025 totaled $401 million, with 91% invested in regulated utilities.

• Total assets reached $24,118 million, up $1,038 million from Q1 2024.

Outlook and guidance

• Focus on regulated and long-term contracted investments to support sustainable earnings and dividend growth.

• Major infrastructure projects (Yellowhead Pipeline, CETO, Atlas Carbon Storage Hub) progressing as planned, with Yellowhead construction expected in 2026 pending regulatory approval.

• Regulatory and policy changes, including Alberta's REM and federal carbon pricing, may impact future operations.

• ATCO Australia will implement the AA6 access arrangement, increasing nominal return on equity to 8.23% and total tariff revenue to $1,375 million for 2025-2029.

• Decision on Yellowhead's needs application anticipated in Q2 or Q3 2025.