Black Hills Corp. Reports First Quarter 2020 Results and Revises Guidance
• Black Hills continues to safely and reliably deliver energy for customers during COVID-19 pandemic challenges
• Minimal financial impacts from COVID-19 in the first quarter
• Strong liquidity to fund operations and capital plan
RAPID CITY, S.D. — May 4, 2020 — Black Hills Corp. (NYSE: BKH) today announced financial results for the first quarter of 2020. Net income and Net income, as adjusted (non-GAAP) for the first quarter of 2020 compared to the first quarter of 2019 were:
Weather reduced gross margin by $12.2 million, or $0.15 per share net of tax, when compared to the first quarter of 2019. GAAP results were impacted by a non-cash, pre-tax $6.9 million impairment of an investment in a privately held oil and gas company related to the divestiture of the company's Oil and Gas segment in 2018.
“The ongoing COVID-19 pandemic has posed significant hardship and challenges across the country,” said Linn Evans, president and CEO of Black Hills Corp. “We extend our sympathies to the individuals and communities impacted by the virus and thank the healthcare workers and first responders for their dedication during this crisis. These are trying times, and I’m pleased with the entire Black Hills team’s unwavering response to these challenges.
Throughout our history, Black Hills has consistently delivered for customers in the most critical times. Today is no different, as we continue to implement a comprehensive set of actions to keep our coworkers, customers and communities safe while delivering essential energy to our communities.
“Throughout our history, Black Hills has consistently delivered for customers in the most critical times. Today is no different, as we continue to implement a comprehensive set of actions to keep our coworkers, customers and communities safe while delivering essential energy to our communities. We are also providing critical assistance to customers with financial difficulties and donating to local relief efforts. Fortunately, much of our service territory is not experiencing an overwhelming number of positive coronavirus cases, and the impacts to our local economies are not as severe as the more urban areas of the country. Nonetheless, we remain vigilant and proactive to mitigate the spread of the virus and expedite the timeline for economic recovery in our communities.
“We entered the year strategically well-positioned and the fundamentals of our business remain strong. We continue to maintain strong liquidity to operate our day-to-day business and execute on our customer-focused capital plan. In the first quarter, we experienced minimal financial impacts from COVID-19. Key drivers we are closely monitoring include the spread of the virus, our coworkers’ health, customer usage, cash flows, contractor availability, lead times for materials, and our progress with large capital projects.
“Weather-adjusted earnings met our expectations for the first quarter. Results benefited from new rates from investments, customer growth and tax credits from new wind generation. These benefits were more than offset by lower gross margins in our electric and gas utilities due to a substantial decrease in heating degree days compared to last year. Consolidated results were also impacted by higher depreciation on new assets in service and increased share count due to new common stock issued since the first quarter of 2019.
“Our strategic initiatives are progressing as planned. I am pleased with our team’s solid execution despite the challenges posed by the pandemic and we are on track to complete our capital plan for the year. We successfully completed the consolidation of 2 four gas utilities in Wyoming with a new, single statewide rate structure effective March 1. Construction advanced on schedule for the 52.5-megawatt Corriedale wind energy project to serve customers in South Dakota and Wyoming through our Renewable Ready program. Our Renewable Advantage program also made progress, with bids being evaluated for up to 200 megawatts of renewable energy to be in service by 2023 for our Colorado Electric customers.
“Looking forward, we are ready to deliver the critical energy our customers and communities need in the face of this health and economic crisis. Executing our customer-focused strategy has positioned us well to support our communities in successfully reopening businesses as soon as safely possible,” concluded Evans.