WEC Energy Group’s (NYSE: WEC) first-quarter earnings dipped year-over-year after one of the mildest winters in its service territory in more than a century.
The utility reported net income of $507.5 million ($1.61/share) for the first quarter of 2023, a drop from the $565.9 million ($1.79/share) it brought in during last year’s first quarter.
WEC Executive Chair Gale Klappa said the weather was a “major factor” in the earnings results.
“We saw one of the mildest winters in the history of the Upper Midwest,” Klappa said during a conference call with financial analysts Monday. “For example, it was the second-warmest first quarter in Milwaukee since 1891. However, we’re confident in our plan for the remainder of the year.”
WEC serves nearly 4.7 million customers in Wisconsin, Illinois, Michigan and Minnesota.
Assuming normal weather for the rest of 2023, WEC will be able to achieve its annual earnings guidance of $4.58 to $4.62/share, Klappa said.
“We continue to focus on the fundamentals of our business: financial discipline, operating efficiency and customer satisfaction,” he said in a statement. “And we’re confident that we can deliver another year of strong results, in line with our original guidance for 2023.”
WEC’s consolidated revenues totaled $2.9 billion, down $20 million from the first quarter a year ago.
The utility said residential electricity use dropped by 5.8% compared to last year’s first quarter. Small industrial and commercial customer electricity consumption fell by 3.4%, and large commercial and industrial customer electricity use declined 3.9%.
Klappa said WEC continues to make progress on its $20.1-billion, five-year environmental, social and governance plan. He said it’s the largest five-year investment plan in the history of the company and should drive compound earnings growth of 6.5% to 7% annually from 2023 through 2027.
“As we look to the future, it’s clear that the mega-trend of decarbonization and the need for even greater reliability will drive investment plans that are long and strong,” he told analysts.
WEC CEO Scott Lauber said that since last December, the Wisconsin Public Service Commission has granted approval for two solar battery parks and WEC’s purchase of a portion of the solar and natural-gas output from Alliant Energy’s West Riverside Energy Center.
Lauber said work continues on Badger Hollow II Solar Farm and the Paris Solar Battery Park, in which WEC shares ownership interest with other utilities. He said the projects’ remaining solar panels are clearing customs in Chicago, and WEC hopes to place the solar parks into service late this year or early next year.
