FirstEnergy Announces Third Quarter 2024 Financial Results
Reports third quarter 2024 GAAP earnings from continuing operations of $0.73 per share and operating (non-GAAP) earnings of $0.85 per share, within guidance range
Narrows full-year 2024 operating (non-GAAP) earnings guidance to $2.61 to $2.71 per share
Increases 2024 capital investment plan from $4.3 billion to $4.6 billion, an increase of approximately 7%, and 24% higher than 2023
Affirms targeted 6-8% long-term annual operating earnings growth
AKRON, Ohio, Oct. 29, 2024 /PRNewswire/ -- FirstEnergy Corp. (NYSE:FE) today reported third quarter 2024 GAAP earnings from continuing operations of $419 million, or $0.73 per basic and diluted share, on revenue of $3.7 billion. This compares to third quarter 2023 GAAP earnings from continuing operations of $421 million, or $0.74 per basic share ($0.73 diluted), on revenue of $3.5 billion. GAAP results for both periods include the impact of special items listed below.
Operating (non-GAAP) earnings for the third quarter of 2024 were $0.85 per share, within the company's guidance range. In the third quarter of 2023, operating (non-GAAP) earnings were $0.88 per share.
"Our financial results point to the strength of our regulated investment strategies and a culture of resiliency, financial discipline and continuous improvement," said Brian X. Tierney, President and Chief Executive Officer. "While we've faced a number of headwinds this year, our entire team has responded to deliver results consistent with our financial commitments. I am proud of the progress we have made this year."
FirstEnergy narrowed its 2024 operating (non-GAAP) earnings guidance range to $2.61 to $2.71 per share, from its original range of $2.61 to $2.81 per share, reflecting lower customer demand from mild weather compared to normal, lower distribution revenues in Ohio as a result of the Electric Security Plan V order, and significantly higher storm restoration costs in the third quarter, partially offset by lower operating expenses.
The company increased its 2024 capital investment plan by $300 million to $4.6 billion, reflecting a 24% increase over 2023 levels.
"We experienced a series of unforeseen challenges in 2024, yet we remain on track to deliver against our five-year, $26 billion Energize365 capital investment program and our long-term 6% to 8% targeted annual earnings growth rate, which is based off the prior year mid-point of operating earnings guidance," Tierney said.
Third Quarter Results
Third quarter 2024 results benefited from the company's Energize365 investment plan, including rate base growth in distribution and transmission formula rate programs and the impact of base rate adjustments, along with higher weather-related sales, given the mild temperatures in 2023. These drivers were partially offset by higher storm restoration expenses, dilution related to the sale of the 30% interest in FirstEnergy Transmission, LLC, that closed on March 25, 2024, and lower tax benefits.
Total distribution deliveries increased 2.5% compared to the third quarter of 2023, reflecting cooling degree days that were 15% above last year, mainly associated with the mild temperatures in 2023, and 7% above normal. On a weather-adjusted basis, total distribution deliveries were essentially flat. Usage decreased 1.4% among residential customers, commercial usage was unchanged and industrial demand increased 2.1% compared to the third quarter of 2023.
Earlier this year, the company introduced new segment reporting to enhance transparency and align with its operating structure. Segment results for 2023 have been recast for comparative purposes.
Third quarter 2024 operating earnings in the Distribution segment increased $0.02 per share compared to the third quarter of 2023. Higher weather-related customer demand during the third quarter of 2024 was partially offset by lower distribution capital rider revenues resulting from the Ohio Companies' Electric Security Plan V.
In the Integrated segment, third quarter operating earnings increased $0.09 per share compared to the third quarter of 2023, primarily due to the impact of base rate adjustments, rate base growth in formula rate investment programs, and higher weather-related distribution customer demand. These items were partially offset by higher storm restoration expenses.
In the Stand-Alone Transmission segment, third quarter 2024 operating earnings decreased $0.04 per share. When adjusted for the 30% sale of FirstEnergy Transmission, LLC, this segment's operating results would have increased $0.02 per share for the quarter. Total rate base for this segment increased 10%, year over year, to $8.4 billion.
Third quarter 2024 operating results decreased in Corporate/Other by $0.10 per share as lower income tax benefits and lower planned earnings from the company's legacy investment in the Signal Peak coal mine were partially offset by lower interest costs as a result of FirstEnergy Corp. debt redemptions.
Year-to-Date Results
For the first nine months of 2024, FirstEnergy reported GAAP earnings from continuing operations of $717 million, or $1.25 per basic share ($1.24 diluted), on revenue of $10.3 billion. This compares to GAAP earnings from continuing operations of $948 million, or $1.66 per basic share ($1.65 diluted), on revenue of $9.7 billion in the first nine months of 2023. GAAP results for both periods reflect the impact of special items listed below.
Operating (non-GAAP) earnings for the first nine months of 2024 were $1.96 per share, compared to $1.94 per share in the first nine months of 2023.
Operating results for the first nine months of 2024 reflect continued growth from the company's regulated investment strategy, the impact of base rate adjustments, higher weather-related distribution sales mostly from the milder temperatures in 2023, and lower net interest expense compared to the first nine months of 2023. These factors more than offset the impact of higher storm restoration and planned operating expenses and the dilutive effect of the sale of the company's 30% interest in FirstEnergy Transmission, LLC.
Consolidated GAAP Earnings Per Share from Continuing Operations (EPS) to Operating (Non-GAAP) EPS Reconciliation
Three Months Ended Sept. 30,
Nine Months Ended Sept. 30,
2024
2023
2024
2023
Earnings Attributable ...
