8-KEarnings & ResultsRegulation FDOther Events+1

EVERSOURCE ENERGY 8-K Report, Financial Results (Sep 30, 2024)

Filed September 30, 2024For Securities:ES

Summary

Eversource Energy (ES) has announced the completion of the sale of its 50% interest in the South Fork Wind and Revolution Wind projects to affiliates of Global Infrastructure Partners (GIP). The transaction generated adjusted gross proceeds of $745 million at closing. However, this amount was reduced by approximately $375 million compared to initial expectations, primarily due to lower capital spending and delays in the commercial operations date for Revolution Wind. The company anticipates recording an aggregate net loss of approximately $520 million in the third quarter of 2024 related to its offshore wind divestiture, which includes a $370 million gain on the prior sale of Sunrise Wind and anticipated increases in Revolution Wind costs. This loss estimate includes a recognized liability of about $360 million, largely expected to be settled in 2026. Notably, Eversource has now divested all its offshore wind interests and confirms its previously announced equity issuance plan of up to $1.3 billion remains in place. The sale of these offshore wind assets has no impact on Eversource's regulated utility businesses.

Key Highlights

  • 1Completed sale of 50% interest in South Fork Wind and Revolution Wind projects to GIP for $745 million in adjusted gross proceeds.
  • 2Transaction proceeds reduced by approximately $375 million from initial estimates due to lower capital spending and Revolution Wind operational delays.
  • 3Expects to record an aggregate net loss of approximately $520 million in Q3 2024 related to the offshore wind divestiture.
  • 4The net loss includes a $370 million gain from the Sunrise Wind sale and anticipated increases in Revolution Wind construction costs.
  • 5Recognizing a liability of approximately $360 million related to the sale, with majority expected settlement in 2026.
  • 6Eversource has now fully exited its offshore wind business.
  • 7Maintains previously announced equity issuance plan of up to $1.3 billion; sale of offshore wind assets does not impact regulated businesses.

Frequently Asked Questions

Eversource Energy received $745 million in adjusted gross proceeds from the sale. However, the final proceeds were about $375 million lower than initially expected due to factors like reduced capital spending and delays in the Revolution Wind project. The company anticipates recording an aggregate net loss of approximately $520 million in the third quarter of 2024 from its complete offshore wind divestiture.

With the completion of this sale, Eversource Energy has fully divested all its ownership interests in the offshore wind business. The company has no ongoing financial obligations associated with the divested Sunrise Wind project and no further material financial impacts are expected from South Fork Wind, which has achieved commercial operations.

The completion of the offshore wind asset sales does not alter Eversource Energy's previously announced equity issuance plan of up to $1.3 billion over the next several years. These divestitures are separate from the company's core regulated utility operations.

Yes, proceeds from the Revolution Wind sale may be subject to further adjustments based on final construction costs and updated project economics at the commercial operations date. There is a shared risk for construction cost overruns up to a certain cap, with Eversource responsible for costs exceeding that cap. Additionally, Eversource may benefit from lower operation costs or higher availability of the projects for a period after commercial operations.