DTE Energy Company
CEO : Mr. Gerardo Norcia
Quarterly earnings growth(YoY,%)
| Period | Revenue | Operating Income | EPS | Release Date |
|---|---|---|---|---|
| 2022 Q4 | -3.7% YoY | 18.1% | -13.1% | 2023-02-23 |
Gerardo Norcia says,
Positive Business Performance in 2022
- DTE delivered strong financial results in 2022, creating shareholder value for investors
- DTE Gas was ranked first in residential customer satisfaction and undertook initiatives to improve electric reliability
- DTE invested $2.5 billion with Michigan businesses, creating and sustaining over 11,000 jobs
Operating EPS Growth and Future Guidance
- In 2022, DTE delivered operating EPS growth of over 10% from original guidance midpoint.
- The 2023 operating EPS guidance delivered 7% growth from the original 2022 guidance midpoint, and the long-term EPS growth target is 6% to 8%.
- DTE’s operating EPS growth exceeded expectations, showcasing the company’s strong financial performance and future potential.
Utility Capital Plan and Investments
- DTE plans to invest $45 billion in its utilities over the next 10 years, with a focus on infrastructure renewal and cleaner generation at DTE Electric.
- The company increased its 5-year utility capital plan by 20% or $3.5 billion over last year’s plan.
- DTE’s retirement of two coal plants and progress towards cleaner generation highlights the company’s commitment to sustainability and a reliable grid.
Integrated Resource Plan and IRA
- The Integrated Resource Plan filed in November accelerates DTE’s generation transformation to achieve carbon emission reductions at DTE Electric of 85% by 2035, 90% by 2040, and net zero by 2050.
- The Inflation Reduction Act benefits DTE’s utility and non-utility businesses, helping enable affordability throughout the company’s plan.
- DTE’s rate case filing demonstrates the company’s dedication to meeting customer expectations and investing in a cleaner grid.
DTE Vantage
- DTE Vantage is consistently growing earnings and investing in renewable energy projects, including an RNG project and customer energy solutions projects in 2022.
- The company is confident in continued growth at this segment due to support from federal and California low carbon fuel standards and the IRA.
- DTE Vantage’s investment in renewable energy projects showcases the company’s commitment to sustainability and growth potential in the clean energy sector.
David Ruud says,
DTE 2022 Financial Results
- Operating earnings for the year were $1.2 billion, translating into $6.10 per share.
- DTE Electric earnings were $961 million, $97 million higher than 2021.
- DTE Gas operating earnings were $272 million, $58 million higher than 2021.
- DT Vantage operating earnings were $93 million in 2022, an $83 million decrease from last year due to the sunset of the REF business.
- Energy trading earnings were lower year-over-year, primarily due to the performance of the power portfolio.
DTE Planning Process and 2023 Guidance
- DTE has a detailed 5-year plan that is constructed with lean and invest plans across the portfolio.
- Operating EPS guidance midpoint of $6.25 per share provides 7% growth from 2022 original guidance midpoint.
- Growth at DTE Electric will be driven by distribution and cleaner generation investments and supported by the O&M reductions.
- DTE Gas will see continued customer focused investment in main renewal and other infrastructure improvements.
- DTE Vantage growth will be driven by a strong development pipeline in RNG and custom energy solutions projects.
- Earnings guidance for Energy trading is $20 million to $30 million for the year.
Balance Sheet Strength
- DTE has a strong investment-grade credit rating and target an FFO to debt ratio of 15% to 16%.
- Increased 2023 dividend by 7.6% continuing the track record of over 100 consecutive years of paying cash dividend.
Q & A sessions,
Vegetation Management
- Investing over $200 million in vegetation management program, which is the largest investment historically
- Taking aggressive tree trimming, hardening of the system by replacing poles and wires and transformers
- Significant improvements in the reliability
Lessons Learned from Rate Case
- Major issue was sales volume forecast, which will be resolved in the next rate case
- Improving quality of submissions going into rate case by reviewing filings and creating context, not only with regulator, but also with interveners and legislators
- Capital part of program has never been a significant question by the commission or interveners
Gas Freight Case Strategy
- Positive alignment in creating Investment Risk Management (IRM) for electric business
- IRM will be primarily directed at the grid
- It will take a few years before it starts to have an impact on the timing of rate cases
2022 Business Performance
- Delivered strong financial results and created shareholder value
- Employee engagement remained at top decile levels, recognized by Gallup Great Workplace Award for 10th consecutive year
- DTE Gas ranked first in residential customer satisfaction, invested more than $1 billion in electric grid, and electric grid operated without incidence 99.9% of the time
- Invested $2.5 billion with Michigan businesses, creating and sustaining more than 11,000 jobs across the state
2023 Outlook
- Well positioned to continue delivering strong performance and premium growth
- Implemented a series of one-time O&M actions to address challenge from final order and support delivery of midpoint of operating EPS guidance range
No bad stock 