MILWAUKEE, Aug. 2, 2022
/PRNewswire/ -- WEC Energy Group (NYSE: WEC) today reported net
income of $287.5
million, or 91 cents per share, for the second quarter
of 2022 – up from $276.0
million, or 87 cents per share, in last year's second
quarter.
For the first six months of 2022, the company recorded net
income of $853.4 million, or
$2.70 per share –
up from $786.1 million, or $2.49 per share, in the corresponding period a year ago.
Consolidated revenues totaled $5.0 billion for the first six months
of 2022, up $668.4 million over revenues for the
first half of 2021.
"A warm start to the summer, solid results from our
infrastructure segment and continued
execution of our capital plan
were major factors that shaped another
strong quarter," said Gale Klappa, executive
chairman.
Retail deliveries of electricity – excluding the iron ore mine
in Michigan's Upper Peninsula –
were down by 0.4 percent in the second
quarter of 2022,
compared to the second quarter last year.
Electricity consumption by small commercial and industrial customers
was 0.7 percent higher during the second quarter of 2022.
Electricity use by large commercial and industrial customers –
excluding the iron ore mine – fell by 2.0 percent.
Residential electricity use rose by 0.1
percent.
On a weather-normal basis,
retail deliveries of electricity during
the second quarter of this year – excluding the
iron ore mine – increased by 0.3 percent.
In light of its strong performance, the company is raising its
earnings guidance for 2022, to a range of $4.36 to $4.40 per
share. This assumes normal weather for the remainder of the year.
The company previously raised its annual guidance to a range of
$4.34 to $4.38 per share, from its original guidance of
$4.29 to $4.33 per share.
Earnings per share listed
in this news release are on a fully diluted
basis.
Conference call
A
conference call is scheduled for 1 p.m. Central time, Tuesday, Aug. 2. The call will review
2022 second-quarter earnings and the company's outlook for the
future.
All
interested parties, including stockholders, news media
and the general public, are invited to
listen. Access the call at 888-330-2443 up to 15 minutes
before it begins. The number for international callers is
240-789-2728. The conference ID is 3088105.
Conference call access also is available at
wecenergygroup.com. Under 'Webcasts,' select 'Q2
Earnings.' In conjunction with this earnings
announcement, WEC Energy Group will post on its
website a package of detailed financial information on its
second-quarter performance. The materials will be available at
6:30 a.m. Central time,
Tuesday, Aug. 2.
Replay
A replay will be available on the website and by phone.
Access to the webcast replay will be available on the website about
two hours after the call. Access to a phone replay also will
be available approximately two hours after the call and remain
accessible through Aug. 16, 2022.
Domestic callers should dial 800-770-2030. International callers should dial 647-362-9199. The
replay conference ID is 3088105.
WEC
Energy Group (NYSE: WEC), based in Milwaukee, is one of the nation's
premier energy companies, serving 4.6 million customers in
Wisconsin, Illinois, Michigan and Minnesota.
The company's principal utilities are We Energies, Wisconsin
Public Service, Peoples Gas,
North Shore Gas, Michigan
Gas Utilities, Minnesota
Energy Resources and Upper Michigan Energy
Resources. Another major subsidiary, We Power, designs, builds and
owns electric generating plants. In addition, WEC Infrastructure
LLC owns a growing fleet of renewable generation facilities in the
Midwest.
WEC Energy Group (wecenergygroup.com) is a Fortune
500 company and a component of the S&P 500. The company has
38,000 stockholders of record, 7,000 employees and more
than $39 billion of assets.
Forward-looking statements
Certain statements contained in this press release are
"forward-looking statements" within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. These statements are based upon
management's current expectations and are subject to risks and
uncertainties that could cause our actual results to differ
materially from those contemplated in the
statements. Readers are cautioned not to place undue reliance
on these statements. Forward-looking statements
include, among other things, statements concerning management's
expectations and projections regarding earnings and future
results. In some cases, forward-looking statements may be
identified by reference to a future period or periods or by the use
of forward-looking terminology such as "anticipates," "believes,"
"estimates," "expects," "forecasts," "guidance," "intends," "may,"
"objectives," "plans," "possible," "potential," "projects,"
"should," "targets," "will" or similar terms or variations of these
terms.
Factors that could cause actual results to differ materially
from those contemplated in any forward- looking statements include,
but are not limited to: general economic conditions, including
business and competitive conditions in the company's service
territories; timing, resolution and impact of rate cases and other
regulatory decisions; the company's ability to continue to
successfully integrate the operations of its subsidiaries;
availability of the company's generating facilities and/or
distribution systems; unanticipated changes in fuel and purchased
power costs; key personnel changes; varying, adverse or unusually
severe weather conditions; continued industry restructuring and
consolidation; continued advances in, and adoption of, new
technologies that produce power or reduce power consumption; energy
and environmental conservation efforts; the company's ability to
successfully acquire and/or dispose of assets and projects and to
execute on its capital plan; cyber-security threats and data
security breaches; construction risks; equity and bond market
fluctuations; changes in the company's and its subsidiaries'
ability to access the capital markets; changes in tax legislation
or our ability to use certain tax benefits and carryforwards;
federal, state, and local legislative and regulatory changes,
including
changes to environmental standards, the enforcement of
these laws and regulations and changes in the
interpretation of regulations by regulatory agencies; supply chain
disruptions; inflation; political or geopolitical
developments, including impacts on the global economy, supply chain
and fuel prices, generally, from the current conflict between
Russia and Ukraine; the impact from any new developments
relating to the COVID-19 pandemic or any future health pandemics;
current and future litigation and regulatory investigations,
proceedings or inquiries; changes in accounting standards; the
financial performance of American Transmission Company as well
as projects in which the company's energy infrastructure business
invests; the ability of the company to obtain additional generating
capacity at competitive prices; goodwill and its possible
impairment; and other factors described under the heading
"Factors Affecting Results, Liquidity and Capital Resources"
in Management's Discussion and Analysis of
Financial Condition and Results
of Operations and under the
headings "Cautionary Statement Regarding Forward-Looking Information" and "Risk Factors"
contained in the company's Form 10-K for the year ended
December 31, 2021, and in subsequent
reports filed with the Securities and Exchange Commission. Except
as may be required by law, the company expressly disclaims any
obligation to publicly update or revise any forward-looking
information.
Tables follow
CONDENSED CONSOLIDATED INCOME STATEMENTS
(Unaudited)
|
Three Months Ended
|
Six Months Ended
|
June 30
|
June 30
|
(in millions,
except per share amounts)
|
2022
|
2021
|
2022
|
2021
|
Operating revenues
|
$
2,127.9
|
$
1,676.2
|
$
5,036.0
|
$
4,367.6
|
Operating expenses
|
|
|
|
|
Cost of sales
|
935.0
|
525.9
|
2,318.4
|
1,791.5
|
Other operation and maintenance
|
449.0
|
463.8
|
903.4
|
943.7
|
Depreciation and amortization
|
279.6
|
266.2
|
557.7
|
527.6
|
Property and revenue
taxes
|
56.1
|
51.5
|
116.9
|
106.7
|
Total operating expenses
|
1,719.7
|
1,307.4
|
3,896.4
|
3,369.5
|
Operating income
|
408.2
|
368.8
|
1,139.6
|
998.1
|
Equity in earnings of transmission affiliates
|
43.0
|
41.3
|
84.7
|
83.9
|
Other income, net
|
19.8
|
39.7
|
59.4
|
72.5
|
Interest expense
|
119.8
|
120.0
|
237.4
|
239.5
|
Other
expense
|
(57.0)
|
(39.0)
|
(93.3)
|
(83.1)
|
Income before income taxes
|
351.2
|
329.8
|
1,046.3
|
915.0
|
Income tax
expense
|
63.4
|
54.1
|
190.5
|
129.0
|
Net income
|
287.8
|
275.7
|
855.8
|
786.0
|
Preferred stock dividends of subsidiary
|
0.3
|
0.3
|
0.6
|
0.6
|
Net (income) loss
attributed to noncontrolling
interests
|
—
|
0.6
|
(1.8)
|
0.7
|
Net income
attributed to common
shareholders
|
$
|
287.5
|
$
|
276.0
|
$
|
853.4
|
$
|
786.1
|
Earnings per share
|
|
|
|
|
Basic
|
$
0.91
|
$
0.88
|
$
2.71
|
$
2.49
|
Diluted
|
$
0.91
|
$
0.87
|
$
2.70
|
$
2.49
|
Weighted average common
shares outstanding
|
|
|
|
|
Basic
|
315.4
|
315.4
|
315.4
|
315.4
|
Diluted
|
316.2
|
316.3
|
316.2
|
316.3
|
Dividends per share
of common stock
|
$
0.7275
|
$
0.6775
|
$
1.4550
|
$
|
1.3550
|
|
|
|
|
|
|
|
|
|
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(in millions, except
share and per share amounts)
|
June 30, 2022
|
December 31, 2021
|
Assets
|
|
|
Current assets
|
|
|
Cash and cash
equivalents
|
$
30.3
|
$
16.3
|
Accounts receivable and
unbilled revenues, net of reserves of $175.8 and $198.3, respectively
|
1,447.7
|
1,505.7
|
Materials, supplies, and
inventories
|
572.2
|
635.8
|
Prepaid taxes
|
193.0
|
182.1
|
Other prepayments
|
33.5
|
63.4
|
Amounts recoverable from
customers
|
134.2
|
102.3
|
Derivative
assets
|
189.8
|
107.0
|
Other
|
41.8
|
44.1
|
Current assets
|
2,642.5
|
2,656.7
|
Long-term assets
|
|
|
Property, plant, and equipment, net of accumulated depreciation and amortization of $10,183.2 and
$9,889.3,
respectively
|
27,626.2
|
26,982.4
|
Regulatory assets (June 30, 2022 and December 31, 2021 include
$96.1 and $100.7, respectively,
related to WEPCo Environmental Trust Finance I, LLC)
|
3,144.7
|
3,264.8
|
Equity investment in transmission affiliates
|
1,837.2
|
1,789.4
|
Goodwill
|
3,052.8
|
3,052.8
|
Pension and OPEB assets
|
942.1
|
881.3
|
Other
|
361.6
|
361.1
|
Long-term
assets
|
36,964.6
|
36,331.8
|
Total assets
|
$
39,607.1
|
$
38,988.5
|
Liabilities and Equity
|
|
|
Current liabilities
|
|
|
Short-term
debt
|
$
1,629.1
|
$
1,897.0
|
Current portion of long-term debt (June 30, 2022 and December 31, 2021 each
include $8.8,
respectively, related to WEPCo Environmental Trust Finance I,
LLC)
|
174.4
|
169.4
|
Accounts
payable
|
1,078.2
|
1,005.7
|
Other
|
936.1
|
680.9
|
Current liabilities
|
3,817.8
|
3,753.0
|
Long-term liabilities
|
|
|
Long-term debt (June 30, 2022 and December 31,
2021 include $98.4
and $102.7, respectively,
related to WEPCo Environmental Trust Finance I, LLC)
|
13,523.4
|
13,523.7
|
Deferred income taxes
|
4,493.1
|
4,308.5
|
Deferred
revenue, net
|
378.7
|
389.2
|
Regulatory
liabilities
|
4,000.1
|
3,946.0
|
Environmental
remediation liabilities
|
504.3
|
532.6
|
Pension and OPEB obligations
|
222.2
|
219.0
|
Other
|
1,176.9
|
1,203.2
|
Long-term
liabilities
|
24,298.7
|
24,122.2
|
Commitments and contingencies
|
|
|
Common shareholders' equity
|
|
|
Common stock – $0.01 par value; 325,000,000 shares authorized; 315,434,531 shares outstanding
|
3.2
|
3.2
|
Additional paid in capital
|
4,121.1
|
4,138.1
|
Retained
earnings
|
7,169.5
|
6,775.1
|
Accumulated other
comprehensive
loss
|
(3.2)
|
(3.2)
|
Common shareholders' equity
|
11,290.6
|
10,913.2
|
Preferred stock of subsidiary
|
30.4
|
30.4
|
Noncontrolling interests
|
169.6
|
169.7
|
Total liabilities and equity
|
$
39,607.1
|
$
38,988.5
|
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
|
Six Months
Ended
|
|
June
30
|
(in millions)
|
2022
|
2021
|
Operating activities
|
|
|
Net income
|
$
855.8
|
$
786.0
|
Reconciliation to cash
provided by operating activities
|
|
|
Depreciation and amortization
|
557.7
|
527.6
|
Deferred income taxes
and ITCs, net
|
163.2
|
164.4
|
Contributions and payments related to pension
and OPEB plans
|
(8.6)
|
(7.6)
|
Equity income in transmission affiliates, net of distributions
|
(17.5)
|
(17.7)
|
Change in –
|
|
|
Accounts receivable and unbilled revenues, net
|
36.3
|
70.0
|
Materials, supplies, and
inventories
|
63.6
|
75.9
|
Prepaid taxes
|
(10.9)
|
(46.8)
|
Other prepayments
|
29.9
|
26.5
|
Amounts recoverable from
customers
|
(31.9)
|
(193.6)
|
Other current assets
|
4.5
|
12.5
|
Accounts
payable
|
1.5
|
(119.3)
|
Temporary
LIFO liquidation credit
|
107.6
|
26.7
|
Other current liabilities
|
128.4
|
(9.5)
|
Other,
net
|
(117.0)
|
(68.9)
|
Net cash provided by operating activities
|
1,762.6
|
1,226.2
|
Investing activities
|
|
|
Capital expenditures
|
(1,028.8)
|
(1,010.1)
|
Acquisition of Jayhawk
Wind, LLC
|
—
|
(119.7)
|
Capital contributions to transmission affiliates
|
(30.3)
|
—
|
Proceeds from the
sale of assets
|
65.0
|
20.8
|
Proceeds from the sale of investments held
in rabbi trust
|
15.4
|
12.7
|
Insurance proceeds received for property damage
|
41.3
|
—
|
Other,
net
|
(0.1)
|
21.7
|
Net cash used
in investing activities
|
(937.5)
|
(1,074.6)
|
Financing activities
|
|
|
Exercise of stock options
|
23.0
|
4.0
|
Purchase of common stock
|
(48.4)
|
(11.3)
|
Dividends paid on common stock
|
(459.0)
|
(427.5)
|
Issuance of long-term debt
|
—
|
1,018.8
|
Retirement of long-term debt
|
(49.1)
|
(341.2)
|
Issuance of short-term loan
|
1.4
|
—
|
Repayment of short-term loan
|
—
|
(340.0)
|
Change in other
short-term debt
|
(269.3)
|
(12.4)
|
Other,
net
|
(6.3)
|
(14.9)
|
Net cash used
in financing activities
|
(807.7)
|
(124.5)
|
Net change in cash, cash
equivalents, and restricted cash
|
17.4
|
27.1
|
Cash, cash equivalents, and restricted cash
at beginning of period
|
87.5
|
72.6
|
Cash, cash equivalents, and restricted cash
at end of period
|
$
104.9
|
$
99.7
|
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SOURCE WEC Energy Group