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Sep 30, 2022
Pinnacle West Q3 2022 Earnings Report
Pinnacle West's Q3 2022 results were lower due to the unfavorable outcome of the prior rate case, but buoyed by strong operational performance and warmer weather.
Key Takeaways
Pinnacle West reported a net income of $326.3 million, or $2.88 per diluted share, for the third quarter of 2022, compared to $339.8 million, or $3.00 per share, for the same period a year ago. The company's lower third-quarter results reflect the unfavorable outcome of the company's prior rate case, which was implemented on Dec. 1, 2021.
Quarterly results were supported by strong operational performance and warmer weather than the previous year.
Employees ensured reliable customer service despite a damaging monsoon season.
APS was among the most improved utilities for residential and business customer satisfaction.
The company increased its 2022 consolidated earnings guidance range to $4.20 to $4.35 per diluted share.
Pinnacle West
Pinnacle West
Forward Guidance
Given the positive year-to-date impacts of beneficial weather, strong sales and customer growth, the company increased its 2022 consolidated earnings guidance range to $4.20 to $4.35 per diluted share from a previously disclosed range of $3.90 to $4.10 per share.
Positive Outlook
- Ensuring service reliability and resilience
- Securing a clean, balanced energy supply for Arizona
- Continuously improving support for all customers, including expanded bill assistance programs for those who need additional support.
- Beneficial weather
- Strong sales and customer growth
Challenges Ahead
- Inflationary pressures
- Unfavorable outcome of the company’s prior rate case
- Higher depreciation and amortization expense due to increased plant assets and updated depreciation rates
- Higher operations and maintenance expense
- Inability to continue using alternative revenue accounting treatment for the lost fixed cost recovery (LFCR) mechanism