Black Hills Corporation · NYSE:BKH
Black Hills — Q4 2024 Earnings Presentation
38 slides from Black Hills's earnings presentation, Feb 6, 2025
Slide 1: 2024 Fourth Quarter and Full Year Review
2024 Fourth Quarter and Full Year Review Feb. 6, 2025
Slide 2: Forward-looking Statements
Forward-looking Statements COMPANY This presentation includes “forward-looking statements” as defined by the Securities and Exchange Commission. We make these forward- INFORMATION looking statements in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Ac
Slide 3: Delivering Results for Stakeholders
Delivering Results for Stakeholders Provided industry-leading reliability Delivered on earnings guidance Maintained solid financial position Achieved constructive regulatory outcomes Advanced strategic growth initiatives Increased dividend 55 consecutive years in 2025* * Future dividends subject to
Slide 4: Financial Outlook
Financial Outlook 2025 Initiated guidance range of $4.00 to $4.20 EPS Long-term Affirmed 4% to 6% growth target* EPS Growth Dividend Increased dividend 4%; targeting 55% to 65% payout ratio** Capital Increased five-year forecast by 10% to $4.7 billion (2025-2029) Investment * Average annual compound
Slide 5: Investing for Customer Needs Drives Growth
Investing for Customer Needs Drives Growth Capital Investment Forecast Increased by 10% to $4.7 billion 2025-2029* (millions) $1,200 Key Investment Categories • Customer growth $1,000 $1,089 • Safety and system integrity projects $1,002 • Replacement and modernization $909 $800 $859 programs $798 $8
Slide 6: Path to 1 GW of Data Center Load
Path to 1 GW of Data Center Load On Track to Deliver Data Center EPS Contribution of 10%+ by 2028 Strong and More than 1 GW of expected data center demand growing demand from existing customers within the next 10 years Expect EPS contribution to more than double to Approximately 500 MW of expected d
Slide 7: Strong Ongoing Customer Growth
Strong Ongoing Customer Growth Customer Count Growth More than Double Population Growth* Black Hills’ Customer Average Customer Count Growth Rate by State Count and Annual Growth and Population Growth Rate* 2.0% (millions) +1.1% 1.8% 1.8% 1.35 1.5% 1.6% +0.8% 1.35 1.0% 1.6% +1.1% 1.34 +1.0% 1.33 0.5
Slide 8: 2024 Financial Review
2024 Financial Review BKH | 2024 Fourth Quarter and Full Year Review | Feb. 6, 2025 | 8
Slide 9: 2024 EPS Earnings Drivers Compared to 2023
2024 EPS Earnings Drivers Compared to 2023 Strategic Expense 4.3% growth Capital Plan Execution Management off long- Execution term base** Income 2023 Margin Weather MTM O&M Financing D&A Taxes Other 2024 $0.66 $0.06 $4.50 ($0.15) ($0.06) $3.91 $0.07 $3.91 $4.00 ($0.33) O&M ($0.15) New rates and ($0
Slide 10: Strategic Growth Trajectory on Track
Strategic Growth Trajectory on Track Delivering on EPS Guidance and Long-term Growth 2023 2024 2025 2026-2029 $4.25 4-6% EPS Growth Key Variances versus Normal target off 2023 guidance Significant O&M measures $4.20 midpoint of $3.75 Key Variances versus Normal Mild weather, generation One-time bene
Slide 11: Solid Investment-Grade Financial Position
Solid Investment-Grade Financial Position Credit Ratings Liquidity and Cash Flow (millions) Moody’s S&P $1,000 $250 million accordion feature (with bank consent) FFO / Debt Baa2 BBB+ $750 $613 million of available liquidity on Long-term Target 14-15% Stable outlook Stable outlook $500 revolving cred
Slide 12: Dividend Track Record
Dividend Track Record 55 Consecutive Years of Annual Increases in 2025 and 83 Consecutive Years Paid* $2.70* Increased Quarterly Dividend 4.5% CAGR 4.0% on Jan. 24. 2025 2020-2025 1970 1980 1990 2000 2010 2020 2025* Annual Dividend Per Share * Future dividends subject to board approval; 2025 dividen
Slide 13: Business Update
Business Update BKH | 2024 Fourth Quarter and Full Year Review | Feb. 6, 2025 | 13
Slide 14: Operational Excellence
Operational Excellence Delivering Safe, Reliable and Cost-effective Service and Strategic Progress Ready Wyoming Data Center Growth Transmission Expansion South Dakota Integrated Colorado Clean Resource Plan Energy Plan (99 MW Lange II) Legislation Wildfire Management Regulatory Progress PSPS and Ri
Slide 15: Building on a Decade of Data Center Success
Building on a Decade of Data Center Success Supportive Business Scalable Service Model High-quality Customers Environment • Proven track record of • Ideal Cheyenne • Access to renewable partnering with hyperscale attributes for data center resources data centers to support operations and their energ
Slide 16: Ready Wyoming Electric Transmission Initiative
Ready Wyoming Electric Transmission Initiative WYOMING SOUTH DAKOTA 260-mile, $350-million Expansion and Interconnection of Electric System in Wyoming • Maintain long-term cost stability for customers • Enhance system resiliency NEBRASKA • Expand access to power markets and provide flexibility as po
Slide 17: Colorado Clean Energy Plan
Colorado Clean Energy Plan Adding New Renewable Resources to Reduce Emissions 80% by 2030* Clean Energy Plan Portfolio** • 100 MW solar build-transfer (utility owned) • 50 MW battery storage build-transfer (utility owned) • 200 MW solar power purchase agreement Key Milestones: Q4 2024 1H 2025
Slide 18: Serving South Dakota Electric Resource Needs
Serving South Dakota Electric Resource Needs* 99 MW of Utility-Owned, Dispatchable Natural Gas Generation Key Milestones: Q1 2025 2H 2025 2H 2026** File for CPCN from Obtain approval for CPCN Place new Wyoming Public from Wyoming Public resource in Service Commission Service Commission
Slide 19: Rate Review Progress
Rate Review Progress • Implemented new approved final base rates for Iowa Gas on Jan. 1, 2025 • Awaiting final decision for Colorado Electric rate review • Requested rate review and rider renewal for Kansas Gas • Preparing to file rate review for Nebraska Gas in the second quarter of 2025 Annual Fil
Slide 20: Wildfire Management & Risk Mitigation
Wildfire Management & Risk Mitigation • Prioritization of wildfire management and Asset Integrity Operational risk mitigation for decades within safety Programs Programs Response culture and reliability goals • Wildfire Mitigation Plan available at: • Vegetation management www.blackhillsenergy.com/w
Slide 21: Strong Long-term Growth Outlook
Strong Long-term Growth Outlook 4% to 6% Long-term EPS growth target* 55%-65% dividend payout target** $4.7 billion 10%+ Capital investment 2025-2029 with Data center EPS contribution to incremental upside opportunities more than double by 2028 and continue into 2029 • Integrated pure-play utility p
Slide 22: Questions
Questions BKH | 2024 Fourth Quarter and Full Year Review | Feb. 6, 2025 | 22
Slide 23: Appendix
Appendix BKH | 2024 Fourth Quarter and Full Year Review | Feb. 6, 2025 | 23
Slide 24: 2024 Scorecard
2024 Scorecard Growth & Financial Performance Operational Excellence EPS, growth targets, credit metrics and utility growth Utilize consistent and efficient processes to deliver safe, reliable and cost-effective energy and a great customer experience Achieve earnings guidance Increase dividend 5
Slide 25: Ready Wyoming Electric Transmission Project Update
Ready Wyoming Electric Transmission Project Update Project CPCN approved in Q4 2022 for approximately 260-mile expansion First segment completed in late 2024 (~$40 million of ~$350 million project) On track with remaining phases by year-end 2025 Northwest line Northeast line from Cheyenne from
Slide 26: Capital Structure
Capital Structure ($ in millions) Dec-21 Mar-22 Jun-22 Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24 Sep-24 Dec-24 Capitalization Short-term Debt 420 342 335 501 1,061 525 525 1,125 600 600 600 18 134 Long-term Debt 4,127 4,128 4,130 4,131 3,607 3,954 3,956 3,800 3,801 3,803 4,247 4,249 4,
Slide 27: EPS, as Adjusted Normalized for Weather and Mark-to-Market
EPS, as Adjusted Normalized for Weather and Mark-to-Market* $2.00 $4.25 EPS, as adjusted* Q1 Q2 Q3 Q4 Full Year 2019* $1.73 $0.24 $0.44 $1.13 $3.53 $1.94 $4.00 2020* $4.10 $1.59 $0.33 $0.58 $1.23 $3.73 $4.02 2021 $1.54 $0.40 $0.70 $1.11 $3.74 $1.73 $1.72 $3.75 2022 $1.82 $0.52 $0.54 $1.11 $3.97 $1.5
Slide 28: Investing for Customer Needs Drives Growth
Investing for Customer Needs Drives Growth $4.7 Billion Capital Investment Forecast (2025-2029) (in millions) Utility Investment Customer Focused Timely Recovery Customer Safety, Reliability and Integrity Rider Eligible $3,634 $1,351 Focused on Primarily rider Diverse mix of Gas safety, Electric Uti
Slide 29: Electric Utilities Capital Investment
Electric Utilities Capital Investment Five-year Forecast of $2.4 Billion Focused on Safety, System Integrity and Growth Forecasted Capital Investment By Type 72% with Timely Forecasted Capital (millions) Recovery* by State $700 $615 $600 $550 $500 Minimal $432 $435 Lag SD 41% Rider CO 36% $383 38% $
Slide 30: Natural Gas Utilities Capital Investment
Natural Gas Utilities Capital Investment Five-year Forecast of $2.1 Billion Focused on Safety, System Integrity and Growth Forecasted Capital Investment By Type 85% with Timely Forecasted Capital (millions) Recovery* by State $500 $447 $447 $431 $412 $386 $400 Rider Eligible CO 34% 17% IA 11% KS $30
Slide 31: Regulated Utility Capital Investment by Type
Regulated Utility Capital Investment by Type (in millions) 2024A 2025F 2026F 2027F 2028F 2029F 2025-2029F Safety, Reliability and Integrity1 $325 $489 $388 $334 $563 $396 $2,169 Growth2 29 36 17 18 24 19 115 General Plant 29 25 27 31 28 21 131 Electric Utilities $382 $550 $432 $383 $615 $435 $2,415
Slide 32: Capital Investment by Segment and Recovery
Capital Investment by Segment and Recovery (in millions) 2024A 2025F 2026F 2027F 2028F 2029F 2025-2029F Minimal Lag Capital - Electric Utilities 1 $54 $282 $120 $127 $334 $115 $978 2 Rider Eligible Capital - Electric Utilities 166 180 101 129 78 147 637 Growth Capital - Electric Utilities 3 29 36 17
Slide 33: Estimated Rate Base by State and Segment
Estimated Rate Base by State and Segment 2019 2020 2021 2022 2023 2024 Colorado $803 South Dakota (all jurisdictions) $1,086 Wyoming $702 Total Electric Utilities $1,747 $1,954 $2,077 $2,212 $2,398 $2,591 Arkansas $838 Colorado $631 Iowa $378 Kansas $296 Nebraska $831 Wyoming $471 Total Gas Utilitie
Slide 34: Last Approved Utility Rate Review Results by Jurisdiction
Last Approved Utility Rate Review Results by Jurisdiction Authorized Effective Authorized Authorized Capital Rate Base Jurisdiction Utility Date Return on Equity Structure (in millions) Arkansas Arkansas Gas Oct. 2024 9.85% 54% debt / 46% equity $823.4 Colorado Colorado Electric Jan. 2017 9.37% 47.6
Slide 35: 2025 Earnings Guidance Assumptions
2025 Earnings Guidance Assumptions Black Hills initiated its guidance for 2025 EPS available for common stock to be in the range of $4.00 to $4.20, based on the following assumptions: • Normal weather conditions within our utility service territories; • Constructive and timely outcomes of utility re
Slide 36: Non-GAAP Financial Measures
Non-GAAP Financial Measures Net Income Available for Common Stock, as adjusted We have provided non-GAAP earnings data reflecting adjustments for special items as specified in the GAAP to non-GAAP reconciliation table in this presentation. Net income available for common stock, as adjusted, is defin
Slide 37: Non-GAAP Financial Measures
Non-GAAP Financial Measures Earnings, as adjusted (in millions) Earnings Per Share, as adjusted 2019 2020 2021 2022 2023 2024 2019 2020 2021 2022 2023 2024 Net income available for common stock $199.3 $227.6 $236.7 $258.4 $262.2 $273.1 $ 3.28 $ 3.65 $ 3.74 $ 3.97 $ 3.91 $ 3.91 (GAAP) Adjustments, af
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