Hydro One (H) Q1 2025 earnings summary

Executive summary

• Net income attributable to common shareholders rose 22.2% year-over-year to $358 million for Q1 2025, with basic EPS increasing to $0.60 from $0.49, driven by higher OEB-approved rates and increased peak demand, partially offset by higher costs and taxes.

• Revenue increased 11.2% to $2,408 million, with 99% of revenues fully rate-regulated, providing stable and growing cash flows.

• Over 1.1 million service restorations were performed after a major March ice storm, affecting more than 600,000 customers, with substantial support from other utilities and contractors.

• The company completed the acquisition of a 48% stake in the East-West Tie Transmission Line for $261 million, immediately contributing to earnings and enhancing its transmission network.

• Received industry recognition for public safety and sustainability initiatives, including EDA awards and sustainable financing accolades.

Financial highlights

• Basic EPS for Q1 2025 was $0.60, up 22.4% year-over-year, driven by higher revenues and transmission demand.

• Revenues, net of purchased power, increased 11% year-over-year to $1,188 million; transmission revenues rose 15% to $636 million, and distribution revenues increased 9.7% to $1,761 million.

• OM&A expenses rose 3.1% year-over-year, with transmission segment costs up 6.6% and distribution costs largely flat.

• Depreciation, amortization, and asset removal costs increased 3.9% year-over-year due to capital asset growth.

• Capital investments reached $735 million, up 9.2% year-over-year, with $423 million in new assets placed in service.

• Quarterly dividend of $0.3331 per share declared, payable June 30, 2025.

Outlook and guidance

• EPS expected to grow 6–8% annually through 2027, with 2027 guidance of $2.15–$2.37, using normalized 2022 EPS of $1.61 as a base.

• Future capital investments projected at $3.5 billion for 2025, $2.9 billion for 2026, and $2.3 billion for 2027.

• Effective tax rate expected to remain between 13% and 16% for the remainder of the JRAP period.

• Ongoing focus on cost management, productivity, and maintaining fiscal prudence within approved budget envelopes.

• Plans to continue investing in reliability, system modernization, and supporting Ontario’s energy transition.