AES' Q4: Beats On Earnings, Raises Growth Targets, Eyes Continued Renewable Expansion & More

The AES Corp AES reported fourth-quarter FY23 adjusted EPS of $0.73, beating the consensus of $0.67.

Revenues of $2.97 billion missed the consensus of $3.36 billion.

In the fourth quarter, Non-regulated revenue rose to $2.19 billion from $2.14 billion a year ago, and Regulated revenue declined to $774 million from $925 million the prior year.

Adjusted EBITDA declined to $625 million from $693 million a year ago.

As of February 26, the company’s backlog, which consists of projects with signed contracts that are not yet operational, is 12.3 GW, including 5.1 GW under construction.

As of December 31, cash and cash equivalents stood at $2.2 billion. AES secured asset sale proceeds of $1.1 billion, exceeding the target of $400 to $600 million.

Andrés Gluski, President and Chief Executive Officer, said, “We exceeded almost all of our strategic objectives, including increasing renewables construction by 100% to 3.5 GW and signing 5.6 GW of new PPAs.”

“Our backlog of signed PPAs now stands at 12.3 GW and we continue to see strong and growing demand from our corporate customers, including data center companies. We are therefore very well-positioned to add 3.6 GW of new capacity to our operating portfolio in 2024 and sign 14 to 17 GW of new renewable contracts from 2023 through 2025.”

Outlook: For FY24, AES expects adjusted EPS of $1.87-$1.97 (consensus $1.89) and adjusted EBITDA of $2.60 billion-$2.90 billion. 

The company projects growth in 2024, primarily driven by new renewables commissions, rate base growth at U.S. utilities, and improved margins in Chile, but partially offset by asset sales and prior-year margins on LNG transactions.

The company increased its annualized growth target for adjusted EPS to 7% to 9% (from 6% to 8%) and adjusted EBITDA to 5% to 7% (from 3% to 5%) through 2027 vs 2023 base.

AES reiterated its annualized growth target for Adjusted EPS at 7%-9% through 2025, from a base of 2020.  

The company expects to grow its dividend by 2% to 3% annually after 2024.

Also Read: US Energy Company AES Eyes Sale Of Coal-Fired Power Plant In Vietnam: Report

Price Action: AES shares are trading higher by 1.03% at $15.71 premarket on the last check Tuesday.