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Unitil (UTL)

Participants
Todd Diggins Director of Finance
Tom Meissner President, Chairman and Chief Executive Officer
Robert Hevert Senior Vice President, Chief Financial Officer and Treasurer
Call transcript
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Operator

Good day and thank you for standing by. Welcome to the Q2 2021 Unitil Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. now today, hand Finance. Todd would to conference I speaker your Diggins, Instructions] like the to over [Operator Director of go ahead. Please

Todd Diggins

Unitil Good us financial you thank Corporation's discuss results. morning XXXX second for quarter and to joining

on Chairman, and Meissner, Hevert, Vice Chief be Officer Financial Bob President President, and the Chief call Officer; and Speaking will Senior Tom today Executive Treasurer.

other We call. will this discuss information on financial and

section we of in the website to press have call, posted mentioned this presentation information, we As the www.unitil.com. announcing Investor our at a including release

We to refer that will call. information during this

the Moving to under made Slide of Reform operating future results Harbor XXXX. Safe events X, the statements comments forward-looking of today Securities Litigation Act about are Private provisions or the

to call on from and on and contained differ Statements we made Forward-looking other be statements recent should Securities predicted. Annual materially Report Commission. Form furnished to that statements inherently involve results and those the risks together our the most Exchange information uncertainties have and or XX-K with considered in filed cautionary with documents actual can other cause

call GAAP no speak the assume to today over fully evaluating measures are The to its supplemental believes these a includes President more measures. only of measures update useful financial the turn these reconciliation Chairman, contains nearest CEO, in I financial to that, performance. company The financial non-GAAP and Meissner. Tom will financial and non-GAAP as accompanying information And, This we measures. describes and with statements non-GAAP them. Forward-looking presentation obligation

Tom Meissner

on going everyone. good X Slide today. morning and Todd, begin I'm Thanks, to

quarter per or income net So, share to of today announce pleased for second the XXXX. million $X.XX of $X.X we're

increase per represents XXXX gross and net share half $XX.X margins. adjusted income first same million reflects six an or of of share. $X.XX $X.XX was Electric higher Gas period the over For and per months XXXX, This of the

quickly to few high I'd Next, review like a level themes.

XXXX earnings in X% above somewhat expected the long-term the with per of to of X% XXXX. higher earnings our share reiterate we to to end be guidance growth First, relative range

recently by for of company company corporate commitment announcement a environmental emissions the goal step our and major to is reflects net and achieving stewardship zero the responsibility. announced This Second, XXXX. a

like case New these of will the Finally, Hampshire $XX utility, filing Utilities for gas to in filings rate Unitil and the note in Combined, Northern revenues. the strategic request later Bob rate Energy nearly also call. Northern our another distribution base details would a I applications for the of million increase Systems pending discuss in Utilities.

companywide June commitment responsibility. corporate levels XXXX. by goal XXXX X, achieve we I Slide XX, emissions XXXX by our net zero to overall part to noted and stewardship, environmental to and to as least sustainability of announced gas on These our by to earlier, Moving relative reduce direct at XX% are emissions goals greenhouse

I've before, evolving our energy vision As create to their said the to and transform clean is needs sustainable meet way future. people a

Bob, to results. We customers. over energy will with will reduce I'll makers to on industry our to the further to and our from emissions provide detail that, pass who now continue policy supply financial With customers, leaders work delivered it

Robert Hevert

you, everyone. morning X. on Thank Tom, and I will good begin Slide

million income increased of result we XXXX. by of higher net year-over-year share basis, operating Electric Strong offset is $X.X growth higher margins, per partially per quarter decrease and Gas million $X.XX to expenses. noted per of year-to-date second or adjusted the earnings represents or a a Tom primarily by gross $X.XX. This share On compared year-over-year announced As earnings share. $X.X today, $X.XX

earnings range X% of to As our XXXX relative long-term EPS share. Tom expect XXXX per mentioned, of full be we to $X.XX year to ahead growth earnings X%

reflects X.X% million, increased an relative and half customer months over sales adjusted to adjusted gross Customers of higher commercial X.X%. conditions. million sales higher industrial Slide and The or volumes in margin XXXX. improving six XXXX, XX, unit first economic of of reflect June the sales to $XX of the ended increase growth Turning X.X% X, was gross XXXX. Electric $X.X X.X% and Electric for unit residential margin The increase higher

noted effect the net months margin gross winter XXXX. compared Gas margin and As growth, million ended XXXX, increase $XX.X adjusted June colder for the increase XX, and on gross of or Slide of the X, weather. combined reflects net rates in adjusted million XX.X% effect was $X.X spring $X.X an million, to weather million warmer favorable Gas six of from $X.X higher customer of The

first X.X% Higher X.X%. period contributing X,XXX natural gas same compared additional the in to XXXX. colder of therm The year-over-year, XXXX served sales also reflect of higher to half was sales customers

Moving an on quarter. bridge XXXX provide XXXX results the we Slide X, for earnings comparing to to

professional is to As result costs sales. gross current In unit and the XXXX, higher higher attributable lower higher the noted benefit earlier, increased XXXX margin higher realized to related labor of COVID fees. higher adjusted Operating the quarter million costs, expenses pandemic. operating as $XX and increase costs and rates a company increased from $X The utility a second of labor million. year maintenance

position be pending offset related seek recent we taxes, other reflecting in the states cases of taxes, creation Instead and economies to to in touch than the we partially an amortization asset Hampshire those more by increase Gas pandemic. million will utility increased presentation. which order is the higher lower decreased incremental utilities' by debt partially Unitil balances, New taxes the Electric to property of a higher area operating $X.X of will lower on plant expense by due reverse, that or in per Taxes, expenses local offset by share recover, primarily we the next reflecting borrowings. payroll trend costs service. service in Utilities New rate rates service. to in a Depreciation Hampshire other million, $X.XX in have COVID million, and that by in retirement a benefit by rate higher primarily authorize the to the on case. area our through Commission's healthcare. lower decision in Interest both regulatory levels The debt utility increased plant expense of each later these largely have will long-term short-term $X.X Public by income interest also bad due addressed related on costs. Other of I decreased of As for cases costs. those unique seen in roughly increase includes lower not $X.X million, recovery higher and million, levels $X.X $X.X in on

by of result higher pre-tax $X.X Lastly, income as a taxes earnings. increased million

Slide million June which Unitil as on million discussed calls, Yesterday, case, the rate to rates effective XX, rate increase on expected million previous temporary Energy now New $X.X a $X.X for with we utility, becoming a X. our rate gas we rate multiyear plan increase. filed Turning a with of Hampshire $X.X I've that base Northern progressing Utilities. in is In proposed temporary case,

XXXX. rate or over effective me, typical that a for Unitil period. to may Temporary collect temporary Hampshire, to deficiency the collected become the it one-year for is revenue of We usually portion the final temporary excuse case is in You a rates to in recall and anticipate order. -- prior Northern final are third rates to of receiving refunded quarter the New through reconciled a rates difference Utilities award

at it revenue multiyear full support Energy plan in We and XXXX, Systems a includes Unitil also capital recover New expenses per to these equity rate Tom. and anticipate will customer XXXX, back case return filings certain on turn filing With decoupling that, the XXXX. in will that to Northern a Utilities. proposal made and I Our over rate Hampshire

Tom Meissner

Bob. At forward believe behind our we're We on XXXX next investment up and regulatory this first initiatives time, we schedule. company to providing XX, call. Thanks, are our updates plan of pleased for half accomplished. Slide us, further what on Todd? proceeding with with the has Wrapping is with look track on the our XXXX

Todd Diggins

thanks, That for coordinate the will the turn call. Great, to attending. you the in now over completes who material operator, questions. call I will Tom. this Thank

Operator

of America. the Clark Instructions] question [Operator of Cody line from Your with comes first Bank

Unidentified Analyst

here, for team. Cody. you morning, the It's Julian opportunity. for good Hey, Thank on guys

spent that overall normalized for just just be normalized here? about to on in First, the that if trends and forecast. but on about persist It's follow-up. here little both some seen of late, a of growth pretty kick and here customer some know on already can cascading your you've terms got just the And I'd elaborate on, you you've expectations bit a if recovery. think just then I've through I remarkable curious that of you time customer trends can I talking off

Tom Meissner

Tom. Julian, Sure, this is

year. from But recovery I increase persist unit in also think Electric the seen is pandemic now sales this to the demands. side, seeing we're on residential sales in in and we're impacts C&I resulted what some of the that a we've seeing

We to seems a couple QX continuing. be by benefited hot some And heat We very, weather. in had that waves. so of very

So that QX, in they where July, seeing but and has when demands we're been persist cooler have normal, recovered. certainly in are much than staying pattern weather overall benefited were that the sales that even C&I

side, we current that they're see of for not trends continues to But some everywhere. evidence maybe strong. On of the activity think -- The in that signs now are the normalizing. I hoped be seeing normalizing terms were we had we Gas seeing what in economic were quarter. that QX in We that

begin to see through to elevated side sales we're remainder stay normalizing norms. year on possibly an at of both So compared side to and the on expecting to historical for the business pretty the of the Electric sales much level

Unidentified Analyst

do Got you -- more longer-term it. and speak expectations at here if against prospects it, And reconcile how from that you your think that would if investment how least preliminarily will? to about earnings an you perspective, from growth can juxtapose --

Tom Meissner

in of and conversions continuing There for we're gas construction interest market drop-off construction. side we or right We're robust large trends a now. hasn't so terms seeing lot In the signs have activity new or investment, really the permitting of because the Gas in that slow realistically in interest past. is hot in housing of and see down same been the just part gas to on any

think connections the and for development. significant probably the now on in what in in market we're Electric what that seen housing in On seeing again, Electric of the because new going we've to new we're permitting see uptick recent side an we're to I relative side, years,

Unidentified Analyst

Hampshire you about regulatory New well. latest mind, here, the the as the can into bit things, expectations that's don't Got on you to side And as like them establish of that and more settlement pivot going prospects I cases case it, and -- of respect you'd to initial if if especially just elaborate feedback if think maybe you if to any can pending with things, the set on excellent. case little side a

Robert Hevert

Sure. Julian, Hevert. this is Bob Good morning,

conferences technical of two continue this you New of We had as gone at the still through case. to Hampshire. a UES rate the simply discovery we form process are think discovery. know, point, well work we in in have which We've may and They

the other there Utilities acceptable, We and as Northern the to will of place would. case. in customer than course base we simpler practice it imagine, can that said, arrive the case parties' investments UES which testimony as revenue step put extent settlement and that that for not is relates Julian, move precedent case adjustments can in at in yesterday, you UES will But if until the Hampshire, includes bit case, rate now, and receive this as a we relates a the -- it rate find had hoped we principally the structure of we It it direction. New November. approved, per same in sometime settlements case. a and in that to filed certainly thought decoupling is and type proceeding for That would is The to we UES the we we we

the very the to quickly that appears filing and now. case efficiently UES are will we we move be be having UES on case, to transparent going as is the be with provide same that approach which taken case We possibly as through able clean as to hopeful with sure did right that the and we we can,

Unidentified Analyst

Excellent.

think the insinuating, and open-ended. were the increase Okay. verbalize chances Does step the to that that what just it you I settlement? increase, for perhaps I'll adjustments, simplicity does leave

Robert Hevert

always any in itself experience, lend being All is a settlement cannot think may things, of case the equal, quickly, take. simpler I Look, positions settlement more other be but to might of to lot or But function our will pursue. again, with including cases our of parties happen. to we that say cases my We cases something more else defend our whether that we'll litigated. a a or Sure. and really positions express these not put are settled can the settled, extent positions, to whether together certainly regardless the is certainty

Unidentified Analyst

Excellent. appreciate there. you the I so well time. Thank All much. we'll very it right, leave really

Tom Meissner

Great, thank you.

Robert Hevert

Thank you, Julian.

Operator

this for are [Operator questions. today's no concludes There participating. call. Instructions] and gentlemen, conference further Ladies Thank you

You disconnect. may now