Duke Energy’s Electric Utilities and Infrastructure segment reported income of $1.45 billion on a GAAP basis, a marginal increase from $1.44 billion in the previous year’s comparable quarter. However, adjusted net income declined to $1.46 billion from $1.53 billion, primarily driven by storm restoration costs, higher operational/maintenance expenses and increased depreciation and interest expenses.

Last month, KeyBanc downgraded DUK shares to Sector Weight from Overweight, saying the recent storms may present a near-term challenge. Analyst Sophine Karp expects the final price tag will pressure Duke’s balance sheet since the majority of storm costs will be capitalized, coming at a time when the company was closing in on achieving its 14% FFO/debt target in 2024. However, Karp said the company is well positioned to benefit from load growth, driven by broader economic development as well as data center demand, across its territories.

“Given the fact that Duke recently received MYRP in Florida and North Carolina, we believe the ultimate recovery of these balances might not occur until after 2025, potentially putting upward pressure on Duke’s $500M/year stated equity needs,” according to Karp.

By Alex Kimani for Oilprice.com

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