UNITIL CORPORATION FINANCIAL AND STRATEGIC UPDATE |
First Quarter 2021 |
May 4th, 2021 |
Forward-Looking Statements and Use of Non-GAAP Measures
This presentation contains "forward-looking statements" within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, included in this presentation are forward-looking statements. These forward-looking statements include statements regarding Unitil Corporation's ("Unitil") financial condition, results of operations, capital expenditures, business strategy, regulatory strategy, market opportunities, and other plans and objectives. In some cases, forward-looking statements can be identified by words such as "may," "will," "should," "expects," "plans," "anticipates," "believes," "estimates," "predicts," "potential" or "continue", the negative of such terms, or other comparable terminology.
These forward-looking statements are neither promises nor guarantees, but involve risks and uncertainties that could cause the actual results to differ materially from those set forth in the forward-looking statements. Those risks and uncertainties include: the novel coronavirus (COVID-19) pandemic, which could adversely impact Unitil's business, financial conditions, results of operations and cash flows, including by disrupting Unitil's employees' and contractors' ability to provide ongoing services to Unitil, by reducing customer demand for electricity or natural gas, or by reducing the supply of electricity or natural gas; Unitil's regulatory and legislative environment (including laws and regulations relating to climate change, greenhouse gas emissions and other environmental matters); fluctuations in the supply of, demand for, and the prices of gas and electric energy commodities and transmission capacity and Unitil's ability to recover energy supply costs in its rates; customers' preferred energy sources; severe storms and Unitil's ability to recover storm costs in its rates; declines in the valuation of capital markets, which could require Unitil to make substantial cash contributions to cover its pension obligations, and Unitil's ability to recover pension obligation costs in its rates; general economic conditions, which could adversely affect (i) Unitil's customers and, consequently, the demand for Unitil's distribution services, (ii) the availability of credit and liquidity resources and (iii) certain of Unitil's counterparty's obligations (including those of its insurers and lenders); Unitil's ability to obtain debt or equity financing on acceptable terms; increases in interest rates, which could increase Unitil's interest expense; restrictive covenants contained in the terms of Unitil's and its subsidiaries' indebtedness, which restrict certain aspects of Unitil's business operations; variations in weather, which could decrease demand for Unitil's distribution services; long-term global climate change, which could adversely affect customer demand or cause extreme weather events that could disrupt Unitil's electric and natural gas distribution services; cyber-attacks, acts of terrorism, acts of war, severe weather, a solar event, an electromagnetic event, a natural disaster, the age and condition of information technology assets, human error, or other reasons could disrupt Unitil's operations and cause Unitil to incur unanticipated losses and expense; outsourcing of services to third parties, which could expose Unitil to substandard quality of service delivery or substandard deliverables, which may result in missed deadlines or other timeliness issues, non-compliance (including with applicable legal requirements and industry standards) or reputational harm, which could negatively impact our results of operations; catastrophic events; numerous hazards and operating risks relating to Unitil's electric and natural gas distribution activities; Unitil's ability to retain its existing customers and attract new customers; increased competition; and other risks detailed in Unitil's filings with the Securities and Exchange Commission, including those appearing under the caption "Risk Factors" in Unitil's Annual Report on Form 10-K for the year ended December 31, 2020.
Readers should not place undue reliance on any forward looking statements, which speak only as of the date they are made. Except as may be required by law, Unitil undertakes no obligation to update any forward-looking statements to reflect any change in Unitil's expectations or in events, conditions, or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.
This presentation contains Non-GAAP measures. The Company's management believes these measures are useful in evaluating its performance. Reconciliations of Non- GAAP financial measures to the most directly comparable GAAP financial measures can be found herein.
PAGE 2
About Unitil
Pure-play New England utility creating long-term sustainable value
We provide energy for life, safely and reliably delivering electricity and natural gas in New England
- Attractive Service Territory with a Growing Customer Base
- New customer additions in Electric and Natural Gas operations
- Continued conversions from competing fuels
- Service areas are well positioned for continued economic growth
- Robust Investment Opportunities in Electric and Natural Gas Distribution Assets
- Electric Grid and Gas System Modernization
- System Expansions
- Investments in system resiliency
- Strategic Regulatory Filings
- Recently filed New Hampshire Electric Multi- Year Rate application
- New Hampshire Natural Gas rate filing expected in the second half of 2021
107,295 | 85,825 |
Electric | Natural Gas |
Customers | Customers |
PAGE 3
First Quarter Results and Strategic Rate Filing
Strong financial results, encouraging economic data, and comprehensive rate filing in New Hampshire
Solid Quarterly Financial Results
- Net Income of $18.9 million or $1.26 per share
- Increase of $3.7 million or $0.24 per share compared to 2020
Regional Economic Data Supports Growth Expectations
- Improving unemployment data, planned and ongoing construction, continued vaccine rollout
- The two "hottest" housing markets in the U.S. currently are in New Hampshire (1)
- Two of the top ten "emerging" housing markets also are in New Hampshire (2)
Unitil Energy Systems Rate Case Filed on April 2, 2021
- Multi-yearRate Plan
- Revenue Decoupling
- Electric Vehicle Infrastructure Investments and Time of Use Rates
- Temporary rates requested for June 1st
Maintain Expected Long-Term EPS Growth Rate of 5% - 7%
- Capital Investment Plan on track
- Expected Rate Base growth of 6.5% - 8.5%
- 55% - 65% Long-Term Dividend Payout Ratio
- Manchester-Nashua(#1), and Concord (#2). As of March 2021. Source: https://www.realtor.com/research/march-2021-hottest-housing-markets/
- Concord (#8), and Manchester-Nashua (#9). Source: April 2021 WSJ/Realtor.com Emerging Housing Markets Index
PAGE 4
Outlook for Economic Recovery and Growth
The ingredients are in place for a robust economic recovery
Improving unemployment data, planned and ongoing construction, and the continued vaccine rollout should lead to robust recovery
- Employment has almost fully recovered to pre-pandemic levels, even as many small businesses (e.g., restaurants) are only now reopening
- Maine and New Hampshire have lower unemployment rates than the national average (1)
- Vaccination is proceeding quickly and is now available to anyone age 16 and over; high rates of adoption
- Greater than 60% of all residents ages 18+ in the states we operate have received at least one vaccine dose, outpacing the majority of states (2)
- Expect a "return to normal" in the coming weeks
- Business activity accelerating; summer "tsunami" predicted
- Signs of "pandemic fatigue" and pent up demand are increasingly visible
- New Hampshire scheduled to lift all business restrictions on May 7
- Gas and electric sales usage are normalizing; expect diminishing pandemic impact in 2021
- Source: U.S. Bureau of Labor Statistics. March 2021 figure is preliminary
- Source: Centers for Disease Control as of April 26, 2021
New Hampshire Unemployment Rate (1)
NH Unemployment Rate is half of National average
18%
16%
14%
12%
10%
8%
6%
4%
2%
0%
21-Mar
21-Feb
21-Jan
20-Dec
20-Nov
20-Oct
20-Sep
20-Aug
20-Jul
20-Jun
20-May
20-Apr
20-Mar
20-Feb
20-Jan
19-Dec
19-Nov
19-Oct
Maine Construction Employment (1)
(in thousands) Construction employment at pre-pandemic levels
31.0
30.5
30.0
29.5
29.0
28.5
28.0
27.5
27.0
21-Mar
21-Feb
21-Jan
20-Dec
20-Nov
20-Oct
20-Sep
20-Aug
20-Jul
20-Jun
20-May
20-Apr
20-Mar
20-Feb
20-Jan
19-Dec
19-Nov
19-Oct
PAGE 5
This is an excerpt of the original content. To continue reading it, access the original document here.
Attachments
- Original document
- Permalink
Disclaimer
UNITIL Corporation published this content on 04 May 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 04 May 2021 14:38:02 UTC.
