The following is a summary of the FirstEnergy Corp. (FE) Q3 2024 Earnings Call Transcript:

Financial Performance:

• FirstEnergy reported GAAP earnings of $0.73 per share for Q3 2024, a slight decrease from $0.74 per share in Q3 2023.

• Operating earnings for Q3 were $0.85 per share, down from $0.88 in the same period last year due to the absence of state tax benefits.

• Key factors affecting financial performance included higher distribution sales due to more normal weather, new base rates in the integrated segment, formula rate investments across businesses, offset by higher storm-related expenses and the dilution from the sale of a 30% stake in FirstEnergy Transmission.

Business Progress:

• FirstEnergy reaffirmed its five-year CapEx plan of $26 billion through 2028, targeting a 6% to 8% long-term annual operating earnings growth, driven by an average 9% annual rate base growth.

• Capital investments for the first three quarters of 2024 amounted to $3.1 billion, a 22% increase over the previous year, with the total 2024 investment plan revised to $4.6 billion.

• The company is participating in PJM's 2024 regional transmission expansion plan, and has entered a joint development agreement for multiple new regional transmission projects across states in the PJM footprint.

Opportunities:

• The company sees opportunities in increasing investments in reliability and growing the transmission network to accommodate future energy demands. As part of PJM's regional transmission expansion plan, several large-scale projects have been proposed to improve the grid's infrastructure.

• Continuous growth in rate base from systematic capital investments in distribution and transmission, coupled with steady rate increases, presents an opportunity for sustained financial growth.

Risks:

• Significant storm expenses that were non-deferrable impacted earnings, alongside the influence of the FET transaction diluting earnings. The intricacies of regulatory engagements, particularly in Ohio and Pennsylvania, pose potential uncertainties affecting future financial stability.

• The absence of sufficient dispatchable generation capacity in PJM could lead to higher future costs for electricity, impacting consumer affordability and posing a long-term strategic challenge for service reliability.

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