10-QPeriod: Q2 FY2023

Duke Energy CORP Quarterly Report for Q2 Ended Jun 30, 2023

Filed August 8, 2023For Securities:DUKDUKBDUK-PA

Summary

Duke Energy Corporation (DUK) reported a net loss of $234 million, or $(0.32) per share, for the three months ended June 30, 2023, a significant decrease from a net income of $907 million, or $1.14 per share, in the same period last year. This decline was largely influenced by a substantial impairment charge related to the sale of its Commercial Renewables business segment, which resulted in a loss from discontinued operations. Excluding these discontinued operations and the Indiana Supreme Court's coal ash ruling, adjusted earnings per share were $0.91 for the quarter, down from $1.09 in the prior year, primarily due to unfavorable weather, lower sales volumes, and higher interest expenses. For the six-month period ended June 30, 2023, Duke Energy reported a net income of $531 million, or $0.69 per share, compared to $1.76 billion, or $2.22 per share, in the prior year. Adjusted earnings per share for the first six months were $2.10, down from $2.38 in the prior year, again impacted by adverse weather, lower volumes, and increased interest costs, though partially offset by rate increases and cost mitigation efforts. Financially, the company maintained a strong liquidity position with $377 million in cash and $5.7 billion available under its Master Credit Facility. Significant capital expenditures were made, primarily in the Electric Utilities and Infrastructure segment, totaling $6.3 billion for the six-month period. The company continued its clean energy transformation, making progress on regulatory matters across its service territories and advancing its cost reduction initiatives.

Financial Statements
Beta
Revenue$6.47B
Operating Expenses$5.18B
Operating Income$1.43B
Interest Expense$727.00M
Net Income-$220.00M
EPS (Basic)$-0.32
EPS (Diluted)$-0.32
Shares Outstanding (Basic)771.00M
Shares Outstanding (Diluted)771.00M

Key Highlights

  • 1Net loss of $234 million ($0.32/share) for Q2 2023, a significant decrease from net income of $907 million ($1.14/share) in Q2 2022, primarily due to impairment charges from the sale of Commercial Renewables.
  • 2Adjusted EPS was $0.91 for Q2 2023, down from $1.09 in Q2 2022, driven by unfavorable weather, lower volumes, and higher interest expenses, partially offset by rate increases and cost savings.
  • 3For the first six months of 2023, net income was $531 million ($0.69/share), down from $1.76 billion ($2.22/share) in the prior year. Adjusted EPS for the period was $2.10, down from $2.38 in the prior year.
  • 4The company is actively selling its Commercial Renewables business, with purchase agreements signed for two major groups expected to close by year-end 2023.
  • 5Capital expenditures for the first six months of 2023 totaled $6.3 billion, primarily invested in the Electric Utilities and Infrastructure segment.
  • 6Duke Energy continues to focus on clean energy initiatives, including expanding solar power and battery storage projects across its service territories.
  • 7The company has strong liquidity, with $377 million in cash and $5.7 billion available under its Master Credit Facility as of June 30, 2023.

Frequently Asked Questions

Duke Energy reported a net loss of $234 million, or $(0.32) per share, for the second quarter of 2023. This compares to a net income of $907 million, or $1.14 per share, in the second quarter of 2022. The decline was largely due to significant impairment charges related to the sale of its Commercial Renewables business.

Duke Energy has entered into purchase and sale agreements for its utility-scale solar and wind group with Brookfield affiliates and its distributed generation group with ArcLight affiliates. Both transactions are expected to close by the end of 2023. The proceeds from these sales are expected to be used for debt reduction.

Unfavorable weather conditions led to lower sales volumes, while higher interest rates increased interest expense for the company. These factors, combined with the impairment charges, negatively impacted both reported and adjusted earnings per share compared to the prior year's period.

As of June 30, 2023, Duke Energy had $377 million in cash and cash equivalents and $5.7 billion available under its $9 billion Master Credit Facility, indicating a strong liquidity position to meet its financial obligations.