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EI

Evergy, Inc. (EVRG)·Q2 2025 Earnings Summary

Executive Summary

  • Adjusted EPS of $0.82 beat Wall Street consensus $0.774, despite 26% fewer cooling degree days; GAAP EPS was $0.74 . S&P Global consensus data used for comparison; values retrieved from S&P Global.*
  • Revenue of $1.437B exceeded consensus $1.326B on recovery of regulated investments and 1.4% weather-normalized demand growth . S&P Global consensus data used for comparison; values retrieved from S&P Global.*
  • Reaffirmed 2025 adjusted EPS guidance of $3.92–$4.12 and long-term 4%–6% EPS CAGR through 2029; dividend declared at $0.6675 per share .
  • Regulatory and growth catalysts: unanimous Kansas Central rate case settlement (net revenue +$128M; surveillance with 50/50 excess-earnings sharing), CCNs approved in Missouri for new gas and solar projects, and potential large-load announcements later in 2025 (Tier-1 pipeline 4–6 GW) .

What Went Well and What Went Wrong

What Went Well

  • EPS beat and execution: “We are pleased to report second quarter adjusted earnings of $0.82 per share, exceeding our internal budget for the quarter” .
  • Demand and investment recovery: Weather-normalized demand grew 1.4%; recovery/return on regulated investments added ~$0.09 EPS, aided by new Missouri West rates .
  • Regulatory progress and pipeline strength: Kansas Central unanimous settlement (+$128M net revenue; 9.7% ROE reference in TDC filings; surveillance/50:50 sharing), CCNs approved for gas and solar in Missouri; Tier‑1 large-load pipeline of 4–6 GW with two data center projects in final agreements (1.0–1.5 GW) .

What Went Wrong

  • Weather headwind: 26% fewer cooling degree days reduced EPS by ~$0.05 YoY; milder weather remained a headwind .
  • Cost and financing headwinds: Higher O&M (−$0.05 EPS YoY) and higher depreciation/interest (−$0.07 EPS YoY) from infrastructure investment; O&M still on plan with confidence to be under budget for full year .
  • Legacy non-regulated investments: Initiated sale of Evergy Ventures portfolio; recorded losses (~$0.08 EPS) excluded from adjusted earnings; remaining book value ~$100M with proceeds to reduce HoldCo debt .

Financial Results

MetricQ2 2024Q1 2025Q2 2025
Revenue ($USD Billions)$1.448*$1.374*$1.437*
GAAP Net Income ($USD Millions)$207.0 $125.0 $171.3
GAAP EPS ($USD)$0.90 $0.54 $0.74
Adjusted EPS ($USD)$0.90 $0.54 $0.82
Net Income Margin (%)14.3%*9.1%*11.9%*

Values with asterisks retrieved from S&P Global.

Actual vs Consensus (Q2 2025)

MetricActualConsensus# of EstimatesResult
Adjusted EPS ($USD)$0.82 $0.774*9*Beat
Revenue ($USD Billions)$1.437*$1.326*3*Beat

Values retrieved from S&P Global.

KPIs and Drivers (Q2 2025)

KPIQ2 2024Q1 2025Q2 2025
Cooling Degree Days YoY change——−26%
Weather-normalized demand growth YoY——+1.4%
O&M YoY EPS variance——−$0.05
Depreciation/Interest YoY EPS variance——−$0.07
Recovery/Return on regulated investments YoY EPS variance——+$0.09

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted EPS (non-GAAP)FY 2025$3.92–$4.12 $3.92–$4.12 Maintained
Long-term Adjusted EPS Growth2026–20294%–6%; top half expected 4%–6%; top half expected Maintained
Dividend per shareQ3 2025—$0.6675 payable Sept 19, 2025 Declared
O&M outlookFY 2025—Under budget expected New qualitative affirmation
Capital Plan2025–2029$17.5B; ~8.5% rate base growth Reaffirmed $17.5B; ~8.5% rate base growth Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
Large-load pipeline (data centers/industrial)11+ GW pipeline; 1.6 GW “finalizing agreements”; ~500 MW by 2029 in “actively building” Tier‑1 pipeline 4–6 GW; two data centers in final agreements (1.0–1.5 GW peak); 1.1 GW peak by 2029 with ~500 MW online Accelerating visibility
Tariffs/regulatory frameworkFiled large-load tariffs in KS/MO; aiming for Q3 resolution; constructive stakeholder engagement KS/MO tariff schedules progressing; KS staff extension to facilitate settlement; hearings set late Sep–Oct Advancing toward resolution
Capital plan and rate base growthRaised plan to $17.5B; ~8.5% avg rate base growth; out-year weighted Reaffirmed $17.5B; clarified 8.5% rate base growth underpinning plan Maintained; more detail
Financing/equity strategyNo 2025 issuance; contemplate ATM forwards to settle in 2026–27; total equity need $2.8B (2026–29) Reiterated no 2025 settlement; may “chip away” via ratable ATM/forwards; ~$600M per year 2026/27 within $2.8B total Consistent; execution optionality
Legislative/regulatory winsMO SB4 transformative; KS HB2107 wildfire mitigation; CCNs/predeterminations advancing MO CCNs approved; KS predeterminations approved; KS Central unanimous settlement expected order by Sep 29 Positive outcomes
Reliability/operations (SAIDI/SAIFI)Maintained improvement despite severe storms SAIDI/SAIFI trending favorably; strong nuclear/fossil/renewables performance Sustained strength

Management Commentary

  • “Our results through June put us on target for the midpoint of full year 2025 adjusted EPS guidance of $3.92 to $4.12 per share.”
  • “We were pleased to reach a unanimous settlement agreement with stakeholders in our pending Kansas Central rate case… net revenue increase of $128,000,000… surveillance report… excess earnings shared fifty‑fifty between customers and the company.”
  • “We are reaffirming our long-term growth target of 4% to 6% through 2029… anticipate being in the top half… with significant additional tailwinds from potential large new customers.”
  • “Two customers, Panasonic and Meta, have now completed construction and are ramping… expect peak demand of 1.1 gigawatts with 500 megawatts online by 2029.”

Q&A Highlights

  • Equity plan and timing: No settlement in 2025; may begin forward sales via ATM to “chip away” equity needs ahead of 2026–27 (~$600M/year) within $2.8B cumulative; confidence in valuation tailwinds .
  • Kansas surveillance/earnings sharing: 50/50 excess-earnings sharing applies until next rate case; intent is balanced outcome with potential for earned ROE improvement as Panasonic ramps .
  • Rate base vs EPS growth: Average 8.5% rate base growth linked to $17.5B plan; more capex weighted to out-years; EPS expected in top half of 4%–6% from 2026; updates at year-end call .
  • System balance and generation build: Multi-year integrated T&D and generation plan; CCNs/predeterminations secured; EPC strategy with leading providers; confidence in COD targets .
  • Large-load tariff gating: Tariffs important but not gating; customers advancing with significant financial commitments ($200M disclosed); announcements expected later in year .

Estimates Context

  • Q2 2025 results beat consensus on EPS and revenue; EPS $0.82 vs $0.774; revenue $1.437B vs $1.326B; 9 estimates (EPS), 3 (revenue) . Values retrieved from S&P Global.*
  • FY 2025 consensus EPS $3.99 and revenue ~$6.06B; FY 2026 consensus EPS $4.30 and revenue ~$6.30B; supportive of reaffirmed guidance [GetEstimates]. Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Strong execution with an EPS and revenue beat in a weather‑headwind quarter; continued confidence to hit FY midpoint with normal weather and O&M levers .
  • Regulatory momentum (KS settlement, MO CCNs) and supportive legislation de‑risk capex recovery and capital plan execution, underpinning 8.5% rate base growth .
  • Large‑load pipeline likely to reset growth trajectory (potentially toward 4%–5% demand growth through 2029) as final agreements announce; narrative catalyst into 2H25/early 2026 .
  • Equity plan prudently staged (ATMs/forwards), minimizing 2025 dilution; incremental load could reduce equity need by “hundreds of millions” over five years per prior commentary .
  • Dividend continuity ($0.6675 declared) and reaffirmed guidance support defensive yield plus growth profile amid infrastructure buildout .
  • Watch near‑term catalysts: KCC order (by Sep 29) on KS settlement, KS/MO tariff proceedings in late Sep–Oct, and potential large‑customer announcements later in 2025 .
  • Risk monitoring: weather variability, O&M and financing costs, execution on generation COD, and tariff outcomes; management indicates O&M under budget and EPC resources secured .

Notes:

  • Revenue, margins, and consensus values marked with asterisks were retrieved from S&P Global.
  • Non‑GAAP adjustments in Q2 2025 primarily exclude unrealized/impairment losses from non‑regulated investments (~$25.4M pre‑tax; net ~$0.08 EPS), reconciling GAAP $0.74 to adjusted $0.82 .