10-QPeriod: Q2 FY2022

CONSOLIDATED EDISON INC Quarterly Report for Q2 Ended Jun 30, 2022

Filed August 4, 2022For Securities:ED

Summary

Consolidated Edison, Inc. (Con Edison) reported solid performance in the second quarter of 2022, driven primarily by its regulated utility operations (CECONY and O&R). The company's net income for common stock increased significantly to $255 million, or $0.72 per share, compared to $165 million, or $0.48 per share, in the prior year period. This growth was largely attributed to higher electric and gas rate base, improved operational efficiencies, and a favorable regulatory environment, including the resumption of late payment charges. While the regulated utilities showed strength, the Clean Energy Businesses experienced a more mixed performance, impacted by fluctuating market conditions and accounting adjustments, though still contributing positively to overall earnings. Con Edison Transmission's results were influenced by prior-year impairments. Looking ahead, the company remains focused on its strategy of providing shareholder value through dividend growth, supported by investments in reliable, resilient, and clean energy infrastructure for its New York customers. The company is also exploring strategic alternatives for its Clean Energy Businesses, the outcome of which could impact future financial performance.

Financial Highlights

43 data points
Beta

Revenue

$3.38B

Net Income

$255.00M

7.5% Net Margin

EPS (Diluted)

$0.72

Total Assets

$65.07B

Cash & Equivalents

$1.13B

Free Cash Flow

$1.48B

Financial Statements
Beta
Revenue$3.38B
Operating Expenses$3.03B
Operating Income$387.00M
Interest Expense$242.00M
Net Income$255.00M
EPS (Basic)$0.72
EPS (Diluted)$0.72
Shares Outstanding (Basic)354.30M
Shares Outstanding (Diluted)355.50M

Key Highlights

  • 1Consolidated Net Income for Common Stock surged by 54.5% to $255 million ($0.72/share) for the three months ended June 30, 2022, compared to $165 million ($0.48/share) in the prior year.
  • 2CECONY's electric operating income saw a decrease of $35 million due to higher purchased power expenses, while gas operating income remained stable, driven by higher gas purchased for resale and rate plan adjustments.
  • 3O&R's electric operating income increased by $2 million, supported by higher revenues from the NY electric rate plan, and gas operating income improved by $1 million.
  • 4Clean Energy Businesses reported a net income increase to $90 million, primarily driven by positive mark-to-market effects and lower operation and maintenance expenses, partially offset by higher gas purchased for resale.
  • 5The company's liquidity remains stable, with cash flows from operating activities increasing significantly for both Con Edison and CECONY in the first half of 2022.
  • 6Con Edison is actively considering strategic alternatives for its Clean Energy Businesses, which could lead to significant future impacts.
  • 7The company's regulated utilities are seeking rate increases, with CECONY requesting $1,038 million and $402 million for electric and gas rates respectively, effective January 2023, though the NYSDPS supports lower increases.

Frequently Asked Questions

The primary driver of Con Edison's earnings growth in the reported quarter was the strong performance of its regulated utility businesses, CECONY and O&R. This growth was fueled by higher electric and gas rate bases, operational efficiencies, and the resumption of late payment charges and other fees.

Con Edison is actively considering strategic alternatives for its Clean Energy Businesses. The outcome of this evaluation could impact the company's future financial condition, results of operations, and liquidity. The Clean Energy Businesses segment did show an increase in net income for the quarter, driven by mark-to-market effects and operational efficiencies.

The company's future earnings are significantly dependent on the rate increases authorized by the NYSPSC. CECONY has requested substantial increases for electric and gas rates effective January 2023. The NYSDPS has proposed lower increases, indicating that the final authorized rates will be a key factor influencing the company's financial performance.

Con Edison has implemented various measures to manage the financial impacts of COVID-19, including deferring costs related to increased uncollectible accounts, utilizing new arrears assistance programs, and managing supply chain and workforce impacts. The company has generally been able to recover costs associated with these impacts through regulatory mechanisms.