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Dec 31, 2022
NextEra Energy Partners Q4 2022 Earnings Report
Reported fourth-quarter earnings with net income of $35 million and extended distribution per unit growth expectations through 2026.
Key Takeaways
NextEra Energy Partners reported a net income attributable to NextEra Energy Partners of $35 million for the fourth quarter of 2022. Adjusted EBITDA was $360 million and cash available for distribution (CAFD) was $74 million. Based on long-term growth visibility, the company extended its 12% to 15% distribution per unit growth expectations through 2026.
Grew distributions per unit approximately 15% year-over-year.
Completed several accretive acquisitions and low-cost financings to support growth.
Extended 12% to 15% distribution per unit growth by an additional year, through 2026, off an updated 2022 base due to long-term growth visibility.
Entered into a new convertible equity portfolio financing for approximately $900 million with a low implied cash coupon of roughly 2.8% for up to 10 years.
NextEra Energy Partners
NextEra Energy Partners
Forward Guidance
NextEra Energy Partners now sees 12% to 15% growth per year in limited partner distributions per unit as being a reasonable range of expectations through at least 2026. NextEra Energy Partners expects the annualized rate of the fourth-quarter 2023 distribution that is payable in February 2024 to be in a range of $3.64 to $3.74 per common unit. Year-end 2023 run-rate adjusted EBITDA expectations are $2.22 billion to $2.42 billion and CAFD of $770 million to $860 million, respectively, reflecting calendar-year 2024 contributions expected from the forecasted portfolio at year-end 2023.
Positive Outlook
- Long-term growth visibility
- Ample liquidity to finance future growth
- Meaningful financing flexibility
- Significant opportunity set in renewables
- Best-in-class distribution per unit growth expectations
Challenges Ahead
- Normal weather and operating conditions
- Positive macroeconomic conditions in the U.S.
- Public policy support for wind and solar development and construction
- Market demand and transmission expansion support for wind and solar development
- Access to capital at reasonable cost and terms