Pinnacle West Reports Lower 2025 First-Quarter Financial Results

Associated Press

01-05-2025

PHOENIX--(BUSINESS WIRE)--May 1, 2025--
Pinnacle West Capital Corp. (NYSE: PNW) today reported a consolidated net loss attributable to common shareholders of $4.6 million, or a loss of $0.04 per diluted share of common stock, for the quarter ended March 31, 2025. This result compares with consolidated net income attributable to common shareholders of $16.9 million, or $0.15 per diluted share, for the same period in 2024.
The results reflect a decrease of about $22 million, primarily the result of higher operations and maintenance expense; depreciation and amortization expense, mostly due to increased plant and intangible assets; lower pension and other benefit service cost credits; lower other income due to the gain on the sale of a former subsidiary recognized in the prior year; and higher interest charges. These negative factors were partially offset by the favorable impacts of new customer rates; a gain from a non-utility equity investment made by subsidiary El Dorado; lower income taxes due to lower pretax income and higher tax benefits related to employee benefits; higher transmission revenue; and higher revenue resulting from Arizona Public Service Co.'s (APS) Lost Fixed Cost Recovery (LFCR) adjustor mechanism.
'Financial results in the first quarter were in line with our expectations, especially given the power plant overhauls and maintenance work that we had built into our budget to ensure our system runs reliably during the upcoming summer months,' said Pinnacle West Chairman, President and Chief Executive Officer Ted Geisler. 'We remain optimistic that we will achieve our annual targets as customer and electricity sales growth remain robust, along with Arizona's overall economy.
'With Arizona's population growing faster than the national average, it's clear that people view Arizona as an attractive place to live and do business.'
A Thriving, Growing Service Territory
The total number of APS retail customers in the first quarter grew a robust 2.3%, while retail sales increased 2.1% quarter over quarter as Arizona's economy remains a diverse growth and investment hub. In fact, a recent study by the U.S. Census Bureau indicates Maricopa County (home to about 70% of APS's customers) had the third-largest numeric growth among U.S. counties. Only Harris County, Texas — where Houston is located — and Miami-Dade County, Fla., experienced larger growth. Further, according to a separate Commercial Cafe report, Phoenix remains the number one spot as the best-positioned industrial real estate market, ranking ahead of Orange County and the Inland Empire in California.
Summer Reliability and Safety Preparations
With temperatures in Arizona quickly heating up, employees have been focused on comprehensive summer preparedness designed to ensure safe and reliable power is delivered when the company's 1.4 million customers need it most to cool their homes and businesses. 'To serve our customers with top-tier reliability, we work year-round on operational preparedness, resource planning, procuring sufficient reserve margins, creating customer partnerships to manage peak demand, and maintaining a comprehensive fire mitigation program,' Geisler emphasized.
APS crews continually conduct patrols – on foot, by vehicle and in the air – across a sprawling network of more than 40,000 miles of power lines, to protect and maintain a strong and resilient energy system. In addition, APS employees are nearing completion of a scheduled maintenance and refueling outage at Palo Verde Generating Station Unit 1. The three-unit nuclear plant – a primary source of clean electricity for the Southwest and one of the largest power producers in the U.S. – is critical to meeting summer demand across the Desert Southwest.
With Arizona's hot summers, low rainfall and dry vegetation, the company is taking further action to support wildfire-prone communities by employing advanced risk modeling tools; expanding its Public Safety Power Shutoffs (PSPS) program to mitigate fire risks and help keep communities safe; and installing innovative fire- and weather-tracking technology on the grid. Among its newly adopted technology, APS has deployed artificial intelligence (AI) fire-sensing cameras to proactively search for early signs of wildfires, thereby enhancing the company's already vigorous wildfire mitigation program. These cameras alert APS fire mitigation experts and fire dispatch centers when smoke and heat traces are detected in targeted, high fire-risk areas.
'The new AI cameras function as powerful extra sets of eyes and are key to helping us deliver safe, reliable energy to all our customers,' said Geisler. 'When minutes matter, integration of this advanced detection technology improves firefighter rapid-response capabilities, thereby helping protect both critical infrastructure and surrounding communities.'
Enhancing Customers' Experiences
The company's focus on summer readiness extends to delivering an industry-leading customer experience. Customer touchpoints – including an interactive outage map and email and text alerts – are continually being enhanced ahead of Arizona's peak summer season. In conjunction with APS's 24/7 Customer Care Center, these tools will help customers stay better informed during any outages.
Furthermore, APS customers are benefiting from an industry-leading call-center featuring fast response times and knowledgeable, courteous advisors; increased proactive email and text notifications; and an industry-leading digital experience through aps.com and the APS mobile app that helps customers stay informed and complete transactions, monitor energy consumption, select their optimal rate plan and efficiently manage their account. All the while, the company continues to emphasize employee learning, tools and resources to ensure all team members understand their individual and collective roles in customers' experiences and interactions with APS.
Financial Outlook
For 2025, the company continues to estimate its consolidated earnings will be within a range of $4.40 to $4.60 per diluted share on a weather-normalized basis. Key factors and assumptions underlying this outlook can be found in the first-quarter 2025 earnings presentation slides at pinnaclewest.com/investors.
Conference Call and Webcast
Pinnacle West invites interested parties to listen to the live webcast of management's conference call to discuss the company's financial results and recent developments, and to provide an update on the company's longer-term financial outlook, at noon ET (9 a.m. Arizona time) today, May 1. The webcast can be accessed at pinnaclewest.com/presentations and will be available for replay on the website for 30 days. To access the live conference call by telephone, dial [phone] or [phone] for international callers and enter participant access code 554993 . A replay of the call also will be available at pinnaclewest.com/presentations or by telephone until 11:59 p.m. ET, Thursday, May 8, 2025, by calling [phone] in the U.S. and Canada or [phone] internationally and entering replay passcode 52252.
General Information
Pinnacle West Capital Corp., an energy holding company based in Phoenix, has consolidated assets of more than $27 billion, about 6,500 megawatts of generating capacity and approximately 6,400 employees in Arizona and New Mexico. Through its principal subsidiary, Arizona Public Service, the company provides retail electricity service to about 1.4 million Arizona homes and businesses. For more information about Pinnacle West, visit the company's website at pinnaclewest.com.
Dollar amounts in this news release are after income taxes. Earnings per share amounts are based on average diluted common shares outstanding. For more information on Pinnacle West's operating statistics and earnings, please visit pinnaclewest.com/investors.
FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements based on current expectations. These forward-looking statements are often identified by words such as 'estimate,' 'predict,' 'may,' 'believe,' 'plan,' 'expect,' 'require,' 'intend,' 'assume,' 'project,' 'anticipate,' 'goal,' 'seek,' 'strategy,' 'likely,' 'should,' 'will,' 'could,' and similar words. Because actual results may differ materially from expectations, we caution readers not to place undue reliance on these statements. A number of factors could cause future results to differ materially from historical results, or from outcomes currently expected or sought by Pinnacle West or APS. These factors include, but are not limited to:
These and other factors are discussed in the most recent Pinnacle West/APS Form 10-K and 10-Q along with other public filings with the Securities and Exchange Commission, which readers should review carefully before placing any reliance on our financial statements or disclosures. Neither Pinnacle West nor APS assumes any obligation to update these statements, even if our internal estimates change, except as required by law.
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CONTACT: Media Contact:
Alan Bunnell
[phone]Analyst Contact:
Amanda Ho
[phone]Website:
pinnaclewest.com
KEYWORD: UNITED STATES NORTH AMERICA ARIZONA
INDUSTRY KEYWORD: UTILITIES ENERGY
SOURCE: Pinnacle West Capital Corp.
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PUB: 05/01/2025 08:40 AM/DISC: 05/01/2025 08:39 AM
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