FirstEnergy (FE) Q2 2024 earnings summary

Executive summary

• Second quarter 2024 GAAP earnings were $0.08 per share, down from $0.41 per share last year, due to special items; operating (non-GAAP) earnings rose 19% to $0.56 per share, exceeding guidance midpoint.

• Revenues for Q2 2024 increased 9% year-over-year to $3.3 billion, driven by higher customer usage, new rate cases, and increased transmission rate base.

• The company reaffirmed its 2024 operating earnings guidance of $2.61–$2.81 per share, a $4.3 billion CapEx plan, and a long-term 6%-8% annual operating earnings growth target, supported by the $26 billion Energize365 investment plan.

• Major progress was made on regulatory and legacy issues, including agreements in principle with the SEC and Ohio Attorney General, constructive regulatory outcomes, and significant balance sheet strengthening.

• Completed the sale of a 30% equity interest in FET for $3.5 billion, raising total equity capital to nearly $7 billion over 2.5 years.

Financial highlights

• Q2 2024 operating (non-GAAP) EPS was $0.56, up from $0.47 in Q2 2023; Q2 2024 GAAP EPS was $0.08, impacted by special items including asset retirement obligations and legal reserves.

• Q2 2024 revenues were $3.3 billion, up from $3.01 billion in Q2 2023.

• First half 2024 operating (non-GAAP) EPS was $1.11, up from $1.06 in the first half of 2023.

• Weather-adjusted residential and commercial sales increased 4% and 7% year-over-year, respectively.

• Capital investments rose 22% in the first half of 2024.

Outlook and guidance

• 2024 operating (non-GAAP) EPS guidance reaffirmed at $2.61–$2.81 per share; Q3 2024 guidance set at $0.85–$0.95 per share.

• 2024 CapEx plan reaffirmed at $4.3 billion, with a five-year $26 billion Energize365 investment plan driving 9% average annual rate base growth.

• Long-term annual operating earnings growth target of 6%-8% and total shareholder return target of 10%-12%.

• No incremental equity needs expected for Energize365, except up to $100 million annually for employee benefit programs.

• Modest dividend growth expected, with a 6% increase to $0.425 per share in March 2024.