Eversource Energy’s Strong Financial Performance in Q1 2025

Eversource Energy, a leading utility holding company, has reported impressive financial results for the first quarter of 2025. The company’s diversified business segments, including electric distribution, electric transmission, natural gas distribution, and water distribution, have all contributed to its overall success.

Earnings Overview and Future Outlook

In the first quarter of 2025, Eversource earned $550.8 million, or $1.50 per share, compared to $521.8 million, or $1.49 per share, in the same period of 2024. This represents a year-over-year increase in earnings per share (EPS) of 0.67%.

The company has reaffirmed its 2025 earnings guidance range of $4.67 to $4.82 per share. Additionally, Eversource has reiterated its long-term EPS growth rate projection of 5% to 7% through 2029, using its 2024 non-GAAP EPS of $4.57 as the base year.

Liquidity and Cash Flows

Eversource’s cash flows from operating activities totaled $1.04 billion in the first quarter of 2025, compared to $291.3 million in the same period of 2024. This significant increase was primarily driven by improved regulatory recoveries and the timing of collections for various cost tracking mechanisms.

The company’s cash and cash equivalents stood at $111.4 million as of March 31, 2025, up from $26.7 million as of December 31, 2024. Eversource also had $1.16 billion in available borrowing capacity under its commercial paper programs as of March 31, 2025.

During the first quarter of 2025, Eversource issued $1.20 billion in new long-term debt and repaid $300 million of existing long-term debt. The company’s Board of Trustees also approved a common share dividend payment of $0.7525 per share, payable on June 30, 2025.

Strategic Developments

One of the key strategic developments for Eversource was the announcement of a definitive agreement to sell its Aquarion water distribution business. The sale, subject to regulatory and other approvals, is expected to close in late 2025 and will result in an aggregate enterprise value of approximately $2.4 billion in cash. Eversource plans to use the net proceeds from the sale to pay down parent company debt.

Segment Performance

Eversource’s regulated business segments, which include electric distribution, electric transmission, natural gas distribution, and water distribution, have all contributed to the company’s strong financial performance.

Electric Distribution The electric distribution segment’s earnings increased by $20.3 million in the first quarter of 2025, compared to the same period in 2024. This was primarily due to higher revenues from base distribution rate increases at PSNH and NSTAR Electric, as well as increased electric system improvements at CL&P.

Electric Transmission The electric transmission segment’s earnings increased by $22.7 million in the first quarter of 2025, driven by a higher transmission rate base as a result of Eversource’s continued investment in its transmission infrastructure.

Natural Gas Distribution The natural gas distribution segment’s earnings increased by $27.8 million in the first quarter of 2025, primarily due to higher revenues from base distribution rate increases at EGMA and NSTAR Gas, as well as increased investments in natural gas infrastructure.

Water Distribution The water distribution segment’s earnings decreased by $1.8 million in the first quarter of 2025, mainly due to the absence of a benefit recorded in the first quarter of 2024 related to a rate case decision for Aquarion Water Company of Connecticut.

Eversource Parent and Other Companies The Eversource parent and other companies’ losses increased by $40.0 million in the first quarter of 2025, primarily due to higher interest expense resulting from the absence of capitalized interest following the sale of the company’s offshore wind investments in the third quarter of 2024, as well as higher interest costs from long-term debt.

Regulatory Matters

Eversource continues to navigate various regulatory proceedings, including the ongoing FERC ROE (return on equity) complaints and transmission rate-related matters.

FERC ROE Complaints Eversource, along with other New England transmission owners, is involved in four separate FERC ROE complaints. The company has recorded a reserve of $39.1 million (pre-tax and excluding interest) for the second complaint period as of both March 31, 2025, and December 31, 2024. The resolution of these proceedings could have a material impact on Eversource’s financial condition, results of operations, and cash flows.

Transmission Rates and Other Transmission Rates-Related Proceedings Eversource’s transmission rates are calculated in accordance with a FERC-approved formula ratemaking framework, which requires an annual update and reconciliation process. From time to time, various matters related to transmission rates, incentives, interconnections, and transmission planning are pending before FERC, and the outcome of these matters could materially impact the company’s financial performance.

Regulatory Developments and Rate Matters

Eversource’s regulated companies continue to navigate various regulatory developments and rate matters in their respective jurisdictions.

Connecticut In Connecticut, PURA is conducting a proceeding to evaluate and implement performance-based regulation (PBR) for electric distribution companies, including CL&P. The proceeding is ongoing, and Eversource is monitoring the developments, but the ultimate outcome and impact on CL&P cannot be predicted at this time.

Critical Accounting Policies

Eversource’s critical accounting policies, as disclosed in its 2024 Form 10-K, remain unchanged and continue to be the most critical in nature for the company’s financial reporting.

Conclusion

Eversource’s strong financial performance in the first quarter of 2025, with increased earnings, improved cash flows, and strategic developments, demonstrates the company’s ability to navigate the evolving utility landscape. The company’s diversified business segments, prudent financial management, and ongoing regulatory engagement position Eversource for continued success in the future.