NiSource Inc. (NI) 2024 Q2 Earnings Call Summary
August 7, 2024 
NiSource Inc. (NI)
| Market Cap | 0.21T |
|---|---|
| Beta | |
| P/E | 39.75452774136047 |
| EPS | 12.247158441111395 |
| Dividend | 0 |
| Dividend Yield | 0.00% |
Optimistic Highlights
- Strong Financial Performance: NiSource reported a second quarter 2024 adjusted EPS of $0.21 and is on track to achieve the upper half of the 2024 adjusted EPS guidance of $1.70 to $1.74.
- Growth and Investment: The company continues to see an acceleration of customer interest in its Northern Indiana service area, particularly for data center development, which is expected to enhance the local tax base and provide value to shareholders.
- Operational Excellence: Successful launch of new IT applications at NIPSCO Electric Operations, demonstrating the company's commitment to safer and more efficient work practices.
- Regulatory Success: Approval of the NIPSCO Gas Rate Case unanimous settlement in Indiana, incorporating $1 billion of additional capital investment and approval of NIPSCO's automated metering infrastructure project.
- ESG Achievements: NiSource continues to achieve top quartile ESG performance and was awarded the top AAA ESG rating for the third consecutive year by MSCI ESG ratings.
Pessimistic Highlights
- Challenges and Uncertainties: The company acknowledges the volatile capital markets environment and regulatory outcomes as potential challenges to executing its plan.
Company Outlook
- Financial Guidance Reaffirmed: NiSource reaffirms its 2024 EPS guidance of $1.70 to $1.74 and expects to achieve the upper half of this range. The company also reaffirms its annual 2023 to 2028 guidance for adjusted EPS growth of 6% to 8% and rate base growth of 8% to 10%.
- Capital Investment Plans: The company is planning for $16.4 billion in base capital investments, with additional projects under consideration that could further enhance growth and customer value.
Q & A Highlights
Q: Can you provide more details on the MISO opportunities, specifically Tranche 1 and Tranche 2? (Shar Pourreza, Guggenheim Partners)
A: Tranche 1 projects are estimated around $300 million, with expectations that costs may exceed original MISO estimates. Tranche 2 details are still being finalized, with projects expected beyond the current financial plan horizon. (Shawn Anderson)
Q: How confident are you in incorporating data center discussions into your plans? (Shar Pourreza, Guggenheim Partners)
A: We're excited about the data center opportunity and are in discussions with various stakeholders. We aim to ensure that data centers work for our current customer base, with no compromise on reliability and appropriate rewards for shareholders. More clarity is expected by EEI or later in the year. (Lloyd Yates)
Q: Considering the visibility into fiscal 2025 and the fact that load is already trending 5% in this quarter, how should we think about growth beyond the 7% midpoint of your guidance? (Nicholas Campanella, Barclays)
A: The company faces headwinds such as volatile capital markets and regulatory outcomes. However, growth in customer count and volumes can help spread costs across a larger base, potentially providing tailwinds. (Shawn Anderson)
Q: Could you share more color on the Pennsylvania rate case and potential for a settlement? (Durgesh Chopra, Evercore ISI)
A: We are continuing discussions with stakeholders and working towards a settlement, focusing on win-win outcomes for our customers and stakeholders. (Melody Birmingham)
Q: Can you provide more details on the agreement to supply gas to a data center? Is this for backup power or core power? (Steve Fleishman, Wolfe Research)
A: The agreement with Digital Dallas in Virginia is to provide power directly to the center. This is part of our opportunity to build more gas infrastructure to support data centers, which is not currently included in our CapEx plan. (Lloyd Yates, Melody Birmingham)