Financial Data and Key Metrics Changes - The company reported an adjusted EPS of 1.55 to 1.6 billion, an increase of 500 million in adjusted PTC from tax credits in 2023, double the amount from 2022 [21] Company Strategy and Development Direction - The company is focused on executing its construction program and developing its pipeline of future projects, aiming to exit coal by the end of 2025 [29] - The company is establishing a leading position in green hydrogen, partnering with Air Products to develop the largest green hydrogen production facility in the U.S. [10] - The company aims to grow its U.S. utilities' combined rate base by 9% annually through 2025 [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term growth outlook, reaffirming a growth rate of 7% to 9% through 2025 [13][21] - The company highlighted strong demand for renewables, particularly in the U.S., and noted that the Inflation Reduction Act (IRA) is enhancing their competitive position [14][41] Other Important Information - The company plans to hold an Investor Day in spring 2023 to share its strategic long-term view and introduce new business segments [14] - The company is relaunching the sale process for its Mong Duong coal plant in Vietnam to align with new government requirements [27][79] Q&A Session Summary Question: Inquiry about missing segmental earnings contributions for 2023 - Management indicated that updates on new business segments will be provided during the upcoming Investor Day [33] Question: Expectations for AES Next business - Management expects significant improvement in margins for AES Next, particularly from Fluence, which is anticipated to be neutral to earnings by 2024 [35][36] Question: Impact of the Inflation Reduction Act on tax credits - Management confirmed that they are well-positioned to benefit from the optionality provided by the IRA, allowing for the selection of the most advantageous tax credit structure [41][42] Question: Confidence in achieving 2023 guidance - Management expressed confidence in securing the necessary equipment and completing the planned projects, although some may slip into 2024 due to timing issues [53][54] Question: Clarification on the timing of project completions - Management indicated that clarity on project timelines would likely be available by summer 2023 [56] Question: Discussion on asset sales and capital allocation - Management confirmed confidence in achieving $1 billion in asset sales by 2025 and indicated that no additional equity is needed for growth through 2025 [49][50] Question: Update on Ohio regulatory developments - Management noted that a favorable ruling on the distribution rate case was received, and they expect a decision on the electric security plan in summer 2023 [75][77]
AES(AES) - 2022 Q4 - Earnings Call Transcript