AMEREN CORP (AEE) Q4 2024 Earnings Summary

Executive Summary

• Q4 2024 delivered diluted EPS of $0.77 on total operating revenues of $1.94B, up year over year from $0.60 EPS and $1.62B revenues; adjusted EPS for 2024 was $4.63 (driven by infrastructure investments and disciplined cost management) versus $4.38 in 2023 .
• 2025 diluted EPS guidance was affirmed at $4.85–$5.05, and Ameren issued long-term EPS CAGR guidance of 6–8% for 2025–2029 (base: $4.95 midpoint), underpinned by projected ~9.2% rate base CAGR from 2024–2029 .
• Ameren’s Board increased the quarterly dividend ~6% to $0.71 (annualized $2.84), marking the 12th consecutive year of increases and targeting a 55–65% payout ratio aligned with EPS growth .
• Strategic catalysts: accelerated generation plan (2.3 GW additional capacity by 2035), data center load pipeline (1.8 GW construction agreements), tariff filing for large industrial customers in Missouri, and MISO Tranche 2.1 where Ameren was selected to lead ~$1.3B of projects .

What Went Well and What Went Wrong

What Went Well

• Revenue and EPS growth YoY in Q4: revenues rose to $1.94B and diluted EPS to $0.77, reflecting increased infrastructure investments, lower O&M, and higher Missouri electric retail sales .
• Long-term growth visibility strengthened: EPS CAGR 6–8% (2025–2029) and ~9.2% rate base CAGR supported by expanded five-year capital plan (+20% vs prior), data center-driven sales growth (~5.5% CAGR expected 2025–2029 at Ameren Missouri) .
• Management confidence and actionable steps: “We expect to deliver near the upper end of the [6–8%] range in the mid- to latter part of the plan” and plan to file a modified large-load tariff with MoPSC by Q2 2025 to facilitate data center growth .

What Went Wrong

• Operating margin compressed: operating income fell to $198M (10.2% margin) from $264M YoY (16.3% margin), reflecting higher depreciation and interest expense despite revenue growth .
• Illinois headwinds: Ameren Illinois Electric Distribution earnings were lower in 2024 due to a reduced allowed ROE under the new multi-year rate plan .
• Non-GAAP adjustments: 2024 included charges tied to Rush Island (net $45M, $0.17/share) and FERC’s MISO base ROE refunds (net $10M, $0.04/share), though management excluded these for adjusted EPS .

Financial Results

Consolidated Results vs Prior Two Quarters (oldest → newest)

Q4 2024 Segment Revenue Breakdown

Q4 2024 KPIs

Non-GAAP Reconciliation (FY 2024)

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• Strategy and execution: “We expect diluted earnings per share to grow at a 6% to 8% compound annual rate from 2025 through 2029, using the 2025 guidance range midpoint of $4.95 per share as the base… rate base growth of approximately 9.2% compounded annually” .
• Demand outlook: “Based on our robust economic development pipeline, we are now expecting our weather-normalized retail sales to increase approximately 5.5% compounded annually from 2025 through 2029… 500 megawatts by end of 2027, 1 gigawatt by end of 2029 and 1.5 gigawatts by end of 2032” .
• Resource plan: “Our preferred plan calls for acceleration and expansion of natural gas generation and battery storage, acceleration of solar… potential extension of the life of [Callaway] and investment in additional nuclear generation by 2040” .
• Dividend policy: “We expect to grow our dividend in line with our long-term earnings per share growth expectations and for our dividend payout ratio to range from 55% to 65%” .

Q&A Highlights

• Growth positioning: Management aims to deliver at or above midpoint near-term, and toward upper end in the mid-to-late part of plan as load and rate base ramp, with EPS trajectory supported by capital plan and funding assumptions .
• Large-load tariff design: Ameren expects minimum commitments and provisions to ensure at least customer neutrality for existing customers; filing targeted by Q2 2025 .
• Balance sheet metrics: Comfort sustaining Baa1/BBB+; cited 17% downgrade threshold metric (Moody’s); conservative equity program supports ratings .
• Missouri rate case: Staff recommended $398M vs company $446M; ROE difference 9.74% vs 10.25%; constructive settlement dialogue ongoing; hearings mid-March; decision May .
• Transmission upside: Tranche 2.1 awards ($1.3B) and competitive bids ($6.5B portfolio) present optionality beyond the baseline plan .

Estimates Context

• Wall Street consensus via S&P Global was unavailable at the time of request (SPGI rate limit exceeded). As a result, we cannot provide formal “beat/miss” comparisons to Street estimates for Q4 2024 or Q1 2025 at this time. Estimates likely incorporate affirmed FY 2025 EPS guidance ($4.85–$5.05) and the new 6–8% EPS CAGR and ~9.2% rate base CAGR disclosed, with potential upward adjustments in out-years to reflect the accelerated generation plan and large-load pipeline, subject to regulatory outcomes and tariff structures .

Key Takeaways for Investors

• Near-term setup: Q4 showed YoY revenue/EPS growth and lower O&M; 2025 guidance reaffirmed; hearings on MO rate case mid-March with decision by May are key catalysts .
• Structural growth: Long-term EPS CAGR of 6–8% anchored by ~9.2% rate base CAGR (2024–2029) and expanded five-year capex (+20% vs prior), driven by accelerated generation and MISO transmission awards .
• Demand inflection: Data center/industrial load agreements (~1.8 GW construction agreements) and planned large-load tariff in Missouri point to multi-year sales growth realization beginning late-2026 through 2029 .
• Funding discipline: Annual equity (~$600M 2025–2029) and planned 2025 debt issuances (MO $500M, IL $650M, Parent $750M) support growth while maintaining Baa1/BBB+ .
• Dividend visibility: New $0.71 quarterly dividend (~$2.84 annualized) with payout guided at 55–65% aligns with EPS CAGR, reinforcing TSR .
• Watch list: MISO Tranche 2.1 competitive bids (~$6.5B portfolio), Missouri legislative session (PISA, transmission, IRP modifications), and large-load tariff approval timeline .
• Risk management: Operating margin compression in Q4 and Illinois ROE headwinds underscore regulatory and cost control importance; management continues to target ~1% O&M CAGR over the plan .

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