10-QPeriod: Q1 FY2021

NEXTERA ENERGY INC Quarterly Report for Q1 Ended Mar 31, 2021

Filed April 23, 2021For Securities:NEENEE-PNNEE-PSNEE-PTNEE-PWNEE-PVNEE-PU

Summary

NextEra Energy, Inc. (NEE) reported a significant increase in net income for the first quarter of 2021 compared to the same period in 2020, primarily driven by improvements in its NEER segment and favorable non-qualifying hedge activity. While operating revenues saw a slight decrease year-over-year, driven by lower energy prices and the absence of a large gain from asset disposals in the prior year, the company's core operations remain strong. Key financial movements include a substantial rise in net income attributable to NEE, reaching $1.666 billion from $421 million in Q1 2020, leading to a significant increase in diluted EPS to $0.84 from $0.21. This performance was bolstered by strong contributions from the FPL segment and NEER, despite challenges like the Texas winter weather event impacting NEER's operations. The company continued its strategic investments in infrastructure, as evidenced by significant capital expenditures. Overall, NEE demonstrated robust financial health and operational execution in Q1 2021, with significant net income growth and continued investment in its business segments. Investors should note the strong performance from NEER and the ongoing strategic investments as key drivers.

Financial Highlights

45 data points
Beta

Revenue

$4.00B

Net Income

$1.67B

41.6% Net Margin

EPS (Diluted)

$0.84

Total Assets

$132.44B

Cash & Equivalents

$1.46B

Free Cash Flow

$1.29B

Financial Statements
Beta
Revenue$4.00B
Operating Expenses$3.07B
Operating Income$669.00M
Net Income$1.67B
EPS (Basic)$0.85
EPS (Diluted)$0.84
Shares Outstanding (Basic)1.96B
Shares Outstanding (Diluted)1.97B

Key Highlights

  • 1Net income attributable to NEE surged to $1.666 billion, a substantial increase from $421 million in the prior year's first quarter.
  • 2Diluted Earnings Per Share (EPS) rose significantly to $0.84 from $0.21 year-over-year.
  • 3Total operating revenues decreased to $3.726 billion from $4.613 billion, impacted by lower energy prices and the absence of a large gain on disposal of assets from the prior year.
  • 4The FPL segment reported strong net income growth of $78 million, driven by continued investments in plant in service.
  • 5NEER's results improved significantly, benefiting from favorable changes in equity security valuations in its nuclear decommissioning funds and positive non-qualifying hedge activity.
  • 6Capital expenditures remained substantial, with $4.575 billion in cash used for capital expenditures, independent power, other investments, and nuclear fuel purchases, including the acquisition of GridLiance.
  • 7The company maintained strong liquidity, with total net available liquidity of approximately $10.6 billion at the end of the quarter.

Frequently Asked Questions

The significant increase in net income was primarily driven by improved results from NextEra Energy Resources (NEER), favorable non-qualifying hedge activity, and higher earnings on new investments. Additionally, changes in the fair value of equity securities in NEER's nuclear decommissioning funds contributed positively compared to the prior year.

The severe winter weather in Texas primarily impacted NEER's operations, leading to unfavorable results from existing generation and storage assets and an increase in bad debt expense due to credit losses. NEER recorded approximately $152 million in bad debt expense for Q1 2021, largely related to this event.

The acquisition of GridLiance on March 31, 2021, for approximately $502 million plus assumed debt, added three FERC-regulated transmission utilities with approximately 700 miles of high-voltage transmission lines across six states to NEER. This acquisition resulted in approximately $599 million of goodwill and is expected to contribute to the expansion of NEE's regulated businesses.

On March 12, 2021, FPL filed a petition with the Florida Public Service Commission (FPSC) for a four-year rate plan starting in January 2022. This plan includes proposed increases to annual revenue requirements and mechanisms for recovering solar project costs. A decision is expected in the fourth quarter of 2021.