• Adjusted Net Income: $47.8 million for fiscal year 2024.
• Adjusted Earnings Per Share (EPS): $2.97, an increase of $0.15 per share compared to 2023.
• Consolidated Return on Equity: 9.4%.
• Electric Adjusted Gross Margin: $107.3 million, an increase of $3.2 million compared to 2023.
• Gas Adjusted Gross Margin: $166.9 million, an increase of $12.4 million compared to 2023.
• Operation and Maintenance Expenses: Increased by $2 million or 2.6%.
• Depreciation and Amortization: Increased by $8.7 million.
• Interest Expense: Increased by $0.6 million.
• Income Taxes: Increased by $0.8 million.
• 2025 Adjusted Earnings Guidance: Expected to be in the range of $3.01 to $3.17 per share.
• 5-Year Investment Plan: Projected at approximately $980 million through 2029.
• Dividend Increase: Quarterly dividend increased by $0.025 per share, bringing the annual dividend to $1.80 per share in 2025.

• Warning! GuruFocus has detected 7 Warning Signs with UTL.

Release Date: February 11, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Unitil Corp (NYSE:UTL) reported strong financial performance with adjusted earnings of $47.8 million or $2.97 per share, marking a 5.3% increase over the previous year.
• The acquisition of Bangor Natural Gas is expected to be earnings accretive over the long term, enhancing Unitil Corp (NYSE:UTL)'s gas operations in Maine.
• Unitil Corp (NYSE:UTL) maintained high customer satisfaction, with 90% of customers reporting satisfaction, and was the highest-rated among 23 eastern utilities.
• The company completed its gas infrastructure modernization program in Maine, improving system safety and reducing fugitive emissions.
• Unitil Corp (NYSE:UTL) announced a 5.9% increase in its annual dividend, reflecting strong financial health and commitment to shareholder returns.

Negative Points

• Higher operating expenses partially offset the gains from increased distribution rates and customer growth.
• Depreciation and amortization expenses increased significantly by $8.7 million due to higher depreciation rates and utility plant service levels.
• Interest expenses rose by $0.6 million, driven by higher short-term borrowings and long-term debt levels.
• The integration of Bangor Natural Gas is expected to be earnings neutral in the near term, indicating potential short-term financial pressure.
• Unitil Corp (NYSE:UTL) faces regulatory challenges, including the need to file a distribution rate case for its New Hampshire subsidiary, which could impact customer bills.

Q & A Highlights

Q: Can you walk through the strategy for filing the distribution rate case at Unitil Energy Systems (UES) and what the customer bill impact might be? Also, are there any important procedural dates to note? A: We are currently assessing the revenue deficiency, so we don't have specific customer bill impacts by class to share yet. We plan to file the case in the second quarter, likely around May 1 or June 1. The current earned ROE for UES is slightly less than the allowed ROE, which is prompting us to file the case in 2025.

Q: Regarding the 5-year capital plan, how should we think about the timing and means of issuing equity, given that 13% will come from equity? A: We have a strong balance sheet and credit metrics, and the increase in the revolver provides financing flexibility. While 13% of the capital plan will come from equity, we have no immediate plans to issue equity at this time.

Q: What are the expected impacts of the Bangor Natural Gas acquisition on earnings? A: We expect the transaction to be earnings neutral on a fully diluted basis in the near term. However, it is anticipated to be earnings accretive over the long term once cost of service rates are implemented following a base rate case.

Q: Can you provide more details on the Advanced Metering Infrastructure (AMI) project and its progress? A: The AMI project is progressing as expected. We have completed all IT integrations, installed new radio frequency equipment, and system testing is underway. We expect meter replacement at our Massachusetts subsidiary to be complete this year and at our New Hampshire subsidiary by 2027, with an estimated cost of approximately $40 million.

Q: What is the guidance for 2025 adjusted earnings per share, and what assumptions are included? A: We expect 2025 adjusted earnings per share to be in the range of $3.01 to $3.17. This guidance assumes normal weather conditions and customer growth consistent with recent experience. We are also reaffirming our long-term EPS growth guidance of 5% to 7%.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.