PNM Resources Reports Earnings Per Share of $0.60

PNM Resources Reports Q2 2024 Earnings and Future Plans

PNM Resources (NYSE: PNM) recently held its second quarter 2024 earnings call, confirming its earnings guidance for the year and presenting substantial initiatives for enhancing system resilience and capital investments. For the quarter, the company reported earnings per share of $0.60, highlighting its proactive strategies in managing increased demand, the impacts of storms, and responding to regulatory changes. PNM Resources is poised to invest significantly in infrastructure in Texas and New Mexico to improve service reliability and support future growth.

Key Takeaways:

• The company reaffirmed its guidance for 2024, targeting earnings between $2.65 and $2.75 per share.
• In response to Hurricane Beryl, which disrupted service for over 116,000 customers, PNM is ramping up its vegetation management efforts.
• PNM has implemented 6-megawatt battery systems and plans to add 30 megawatts more.
• A significant resiliency plan will be submitted in Texas, projecting approximately $600 million in capital investments.
• The company is investigating options for transmission expansion and mobile generation in Texas and exploring new resource opportunities in New Mexico.
• Regulatory updates have included filings related to rate cases in New Mexico.
• PNM Resources has completed the issuance of junior subordinated convertible notes and plans to issue $100 million of equity annually through 2028.

Company Outlook:

• PNM Resources aims to reduce regulatory lag and bolster system resiliency.
• A 20-year transmission plan is being developed to accommodate rising demand.
• The company plans to submit proposals in the fourth quarter for resources to be operational by 2028.
• A study is ongoing with ERCOT to explore transmission development in West Texas.

Challenges:

• Approval for the resiliency filing is expected in the first quarter of 2025.
• PNM is awaiting responses from interveners before moving forward with settlement discussions in New Mexico’s rate case process.

Opportunities:

• PNM is optimistic about prospects in the ERCOT Permian transmission project, which could be valued at $4 billion.
• The company is assessing further opportunities in vegetation management following the recent hurricanes.

Missed Details:

• Specific details regarding the additional $150 million Texas Resiliency Filing are still pending, as the filing has yet to be submitted.

Q&A Highlights:

• Don Tarry, COO, emphasized the commitment to mobile generation in rural areas, ensuring a constant focus despite recent developments.
• There is a potential for settlement discussions in New Mexico pending further understanding from interveners.
• Tarry also pointed out the necessity for improvements in system resiliency and vegetation management due to the impact of hurricanes.

In summary, PNM Resources is proactively addressing infrastructure improvements and resilience planning while preparing for future demand within its service areas. The company’s dedication to navigating regulatory challenges and market dynamics remains strong, as it continues to focus on financial targets and operational excellence.

Investing Insights:

PNM Resources exhibits a commitment to growth and resilience amid changing market conditions. Key financial metrics suggest a strong market presence, though the company carries significant debt, which poses a consideration for investors balancing financial health against ambitious capital investment plans. Despite some cash burn as infrastructure projects progress, net income is expected to rise this year, potentially alleviating financial pressures.

For investors, comprehensive financial and market analysis on PNM Resources is available, providing insights into the company’s performance and future potential for informed investment decisions.