Canadian Utilities (CU) Q3 2024 earnings summary

Executive summary

• Adjusted earnings for Q3 2024 were $102 million ($0.38/share), up 17% or $15 million year-over-year, driven by growth across ATCO Energy Systems, ATCO EnPower, and ATCO Australia.

• IFRS earnings dropped to $12 million in Q3 2024 from $125 million in Q3 2023 due to non-recurring items.

• Strong operational execution and robust cash flow from operations of CAD 419 million, up 9% year-over-year, supported capital investment and growth initiatives.

• Sale of ATCO Energy Ltd. to parent ATCO Ltd. for $85 million resulted in a $14 million loss, excluded from adjusted earnings.

Financial highlights

• Adjusted earnings increased from $87 million in Q3 2023 to $102 million in Q3 2024; adjusted EPS was $0.38.

• IFRS earnings attributable to equity owners dropped from $125 million in Q3 2023 to $12 million in Q3 2024.

• Cash flows from operating activities grew from $410 million in Q3 2023 to $419 million in Q3 2024.

• Capital investment reached $420 million in Q3 2024, up from $331 million in Q3 2023.

• Fourth quarter dividend declared at $0.4531/share ($1.81 annualized).

Outlook and guidance

• Construction of Yellowhead Mainline expected to begin in 2026, with operations in Q4 2027, pending regulatory approval.

• Heartland Hydrogen Hub FEED to commence by end of 2024, with ongoing collaboration with governments and First Nations.

• ATCO Gas Australia received regulatory approval for a five-year plan, including a higher ROE of 8.23%.

• No additional equity financing anticipated in the near term; growth in EnPower to be self-funded through operating cash flow and project-level debt.