Northwestern Energy Group, Inc. · NASDAQ:NWE
Northwestern Energy — Q1 2025 Earnings Presentation
38 slides from Northwestern Energy's earnings presentation, Apr 30, 2025
Slide 1: First Quarter Earnings Webcast
First Quarter Earnings Webcast April 30, 2025 8-K April 30, 2025
Slide 2: Forward Looking Statements
NorthWestern Energy 2 Forward Looking Statements During the course of this presentation, there will be forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements often address our expected future b
Slide 3: Recent Highlights
Recent Highlights ✓ Reported GAAP diluted EPS of $1.25 o Non-GAAP diluted EPS of $1.221 ✓ Affirming long-term rate base and earnings per share growth rates targets of 4% - 6%2 ✓ Completed debt financing needs for 2025 •No planned equity to finance 5-year capital investment ✓ Dividend Declared: $0.66
Slide 4: The NorthWestern Value Proposition
9%-11% Total Growth >11% Total Growth Incremental Opportunities: > 6% EPS Growth ~5% Dividend Yield Base Capital Plan: 4%-6% EPS Growth ✓ Data centers & new large- load opportunities ✓ FERC Regional Transmission ✓ Incremental generating capacity (subject to successful resource procurement bids) $2.7
Slide 5: First Quarter Financial Review
Thank youFirst Quarter Financial Review 5
Slide 6: First Quarter 2025 Financial Results
First Quarter 2025 Financial Results 6 1.) See “First Quarter 2025 Non-GAAP Earnings” below and “Non-GAAP Financial Measures” in appendix. First Quarter Net Income vs Prior Period • GAAP: $11.8 million or 18.1% • Non-GAAP1: $8.1 million or 12.1% First Quarter EPS vs Prior Period • GAAP: $0.19 or 17.
Slide 7: First Quarter Earnings Drivers
First Quarter Earnings Drivers 7 Increase in diluted EPS during the quarter is primarily due to improved utility margins offset by higher depreciation, interest, and operating expenses. After-tax EPS vs Prior Year 1.) Utility Margin is a non-GAAP measure. See appendix slide titled “Reconciling Gross
Slide 8: First Quarter Utility Margin Bridge
First Quarter Utility Margin Bridge Pre-tax Millions vs. Prior Year $30.7 million or 10.2% increase in Utility Margin items that impact Net Income NOTE: Utility Margin is a non-GAAP measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure. 8
Slide 9: First Quarter 2025 Non-GAAP Earnings
We estimate weather to be a $2.2 million pre-tax benefit as compared to normal and a $3.4 million benefit as compared to first quarter 2024. (1) As a result of the adoption of Accounting Standard Update 2017-07 in March 2018, pension and other employee benefit expense is now disaggregated on the GAA
Slide 10: Credit, Cash Flow, and Financing Plans
Credit, Cash Flow, and Financing Plans 10 Credit Ratings Stable Outlook at Moody’s, S&P, and Fitch. No equity expected to fund the current $2.74 billion 5-year capital plan. Financing plans (targeting a FFO to Debt ratio > 14%) are expected to maintain our current credit ratings. We expect to pay mi
Slide 11: Montana Electric Rate Review
11 Montana Electric Rate Review MPSC approval of the partial Joint Party Settlement, along with NorthWestern’s proposals for YCGS and PCCAM, would allow for recovery of increased operating costs and an opportunity to earn a fair return on the investment that funds the critical energy infrastructure
Slide 12: Montana Natural Gas Rate Review
MPSC approval of the Joint Party Settlement would allow for recovery of increased operating costs and an opportunity to earn a fair return on the investment that funds the critical energy infrastructure in Montana. 12 Montana Natural Gas Rate Review Key Dates • 5/23/25: Implementation of rebuttal ra
Slide 13: Strong Growth Outlook
Strong Growth Outlook 13 ✓ 2025 EPS guidance expected to be provided following the outcome of our pending Montana rate review ✓ Affirming long-term growth rates from 2024 base1 • EPS growth of 4% to 6% • Rate base growth of 4% to 6% • Continued focus on closing the gap between earned & authorized re
Slide 14: Five-Year Capital Investment Plan
11% increase in 5-year capital investment plan $2.74 billion of highly-executable and low-risk critical capital investment Regulated Utility Five-Year Capital Forecast (millions) 14
Slide 15: Other Updates
Thank youOther Updates 15
Slide 16: Montana Wildfire Bill
16 Montana Wildfire Bill No Strict Liability: • Confirms strict liability cannot be applied to utility operations related to wildfire Legal Protections for Providers: • Negligence standard based on Montana specific circumstances • Rebuttable presumption utility acted reasonably if it substantially f
Slide 17: Transmission Bill
17 Transmission Bill Allows Certificate of Public Convenience & Necessity (CPCN) for electric transmission to be issued by the Montana Public Service Commission (MPSC) • Advanced Technology Includes solutions like advanced conductors to enhance capacity and reduce wildfire risk • Approvals MPSC shal
Slide 18: Incremental Colstrip Capacity
18 Incremental Colstrip Capacity NorthWestern’s planned no cost acquisition of 592 MW of additional Colstrip capacity supports the integration of large-load customers, delivering substantial benefits to our customers, communities, and investors. 760 MW Existing Ownership Montana Average Load ✓ No co
Slide 19: Large Load Customers
✓ Montana ▪ Served by overall utility portfolio, which is expected to be long capacity beginning in 2026 ▪ Served from generating portfolio over 60% carbon free ▪ If data center demand interest develops beyond existing capacity, we will work with the Montana Public Service Commission to structure ap
Slide 20: Regional Transmission Opportunities
20 Regional Transmission Opportunities Colstrip Transmission System North Plains Connector (NPC) Consortium Project • $3.6 billion, 415-mile, high-voltage direct-current transmission line connecting to Montana's Colstrip substation, bridging the eastern and western U.S. energy grids • Project awarde
Slide 21: Conclusion
Conclusion Pure Electric & Gas Utility Solid Utility Foundation Best Practices Corporate Governance Attractive Future Growth Prospects Strong Earnings & Cash Flows 21 NorthWestern Energy Group, Inc. dba: NorthWestern Energy Ticker: NWE (Nasdaq) www.northwesternenergy.com Corporate Support Office 301
Slide 22: Appendix
Thank youAppendix: 22
Slide 23: (1) The revenue requirement associated with the FERC regulated portion of Montana electric transmission
(1) The revenue requirement associated with the FERC regulated portion of Montana electric transmission and ancillary services are included as revenue credits to our MPSC jurisdictional customers. Therefore, we do not separately reflect FERC authorized rate base or authorized returns. (2) The Montan
Slide 24: First Quarter Financial Results
First Quarter Financial Results 24 1.) Utility Margin is a non-GAAP Measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure. Note: Subtotal variances may exist due to rounding. Appendix (in millions except per share amounts) 2025 2024 Variance % Vari
Slide 25: Utility Margin (Q1)
Utility Margin (Q1) ($ in millions) Three Months Ended March 31, 2025 2024 Variance Electric $ 242.7 $ 227.8 $ 14.9 6.5% Natural Gas 85.7 72.8 12.9 17.7% Total Utility Margin1 $ 328.4 $ 300.6 $ 27.8 9.2% (1) Utility Margin is a non-GAAP Measure. See appendix slide titled “Reconciling Gross Margin to
Slide 26: Operating Expenses (Q1)
Operating Expenses (Q1) Increase in operating expenses due to the following factors: $ 5.7 Depreciation expense due to plant additions and higher depreciation rates 3.5 Electric generation maintenance 3.3 Insurance expense, primarily due to increased wildfire risk premiums 1.1 Labor and benefits(1)
Slide 27: Operating to Net Income (Q1)
Operating to Net Income (Q1) (dollars in millions) Three Months Ended March 31, 2025 2024 Variance Operating Income $ 124.7 $ 102.1 $ 22.6 22.1% Interest expense, net (36.5) (31.0) 5.5 17.7% Other income, net 3.9 4.3 (0.4) (9.3%) Income Before Taxes 92.1 75.4 16.7 22.1% Income tax expense (15.2) (10
Slide 28: Tax Reconciliation (Q1)
Tax Reconciliation (Q1) 28 Appendix ($ in millions) Variance Income Before Income Taxes $92.1 $75.4 16.7 Income tax calculated at federal statutory rate 19.4 21.0% 15.8 21.0% 3.6 Permanent or flow-through adjustments: State income taxes, net of federal provisions 0.9 0.9% 0.6 0.9% 0.3 Flow-through r
Slide 29: Segment Results (Q1)
Segment Results (Q1) 29 Appendix *Direct transmission expense excludes depreciation and depletion. (1) Utility Margin is a non-GAAP Measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure. (2) Consists of unallocated corporate costs and some limited
Slide 30: Electric Segment (Q1)
Electric Segment (Q1) (1) Included within this line is our lighting customer class, which we have historically counted each lighting district as one customer. We have retroactively modified our customer counts to now reflect each lighting service as a customer as that better aligns with the MWH usag
Slide 31: Natural Gas Segment (Q1)
Natural Gas Segment (Q1) 31 Appendix (1) Utility Margin is a non-GAAP Measure. See appendix slide titled “Reconciling Gross Margin to Utility Margin” for additional disclosure.
Slide 32: ($ in millions) As of March 31, As of December 31, 2025 2024 Cash
($ in millions) As of March 31, As of December 31, 2025 2024 Cash and cash equivalents 56.0$ 4.3$ Restricted cash 24.0 24.7 Accounts receivable, net 187.5 187.8 Inventories 119.6 122.9 Other current assets 85.7 78.5 Goodwill 357.6 357.6 PP&E and other non-current assets 7,271.0 7,221.8 Total Assets
Slide 33: ($ in millions) 2025 2024 Operating Activities Net Income .9$ 65.1$ Non-Cash adjustments to
($ in millions) 2025 2024 Operating Activities Net Income 76.9$ 65.1$ Non-Cash adjustments to net income 77.1 69.4 Changes in working capital (0.1) 33.4 Other noncurrent assets & liabilities (0.5) (6.2) Cash Provided by Operating Activities 153.4 161.7 Cash Used in Investing Activities (96.7) (109.0
Slide 34: Reconciling Gross Margin to Utility Margin
Reconciling Gross Margin to Utility Margin Management believes that Utility Margin provides a useful measure for investors and other financial statement users to analyze our financial performance in that it excludes the effect on total revenues caused by volatility in energy costs and associated reg
Slide 35: PCCAM Impact by Quarter
PCCAM Impact by Quarter Qualified Facility Earnings Adjustment Our electric QF liability consists of unrecoverable costs associated with contracts covered under PURPA that are part of a 2002 stipulation with the MPSC and other parties. Risks / losses associated with these contracts are born by share
Slide 36: Non-GAAP Financial Measures
Non-GAAP Financial Measures 36 Appendix Pre-Tax Adjustments ($ Millions) 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Reported GAAP Pre-Tax Income 181.2$ 156.5$ 176.1$ 178.3$ 182.2$ 144.2$ 190.2$ 182.4$ 201.6$ 214.7$ Non-GAAP Adjustments to Pre-Tax Income: Weather 13.2 15.2 (3.4) (1.3) (7.3) 9.
Slide 37: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation includes financial information prepared in accordance with GAAP, as well as other financial measures, such as Utility Margin, Adjusted Non-GAAP pretax income, Adjusted Non-GAAP net income and Adjusted Non-GAAP Diluted EPS that are considered “non-GAAP fi
Slide 38: Thank you
Thank youDelivering a bright future 38
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