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Toronto Hydro Corporation reports its third quarter financial results for 2023
TORONTO, Nov. 17, 2023 /CNW/ - Toronto Hydro Corporation (the Corporation) today announced its consolidated financial and operating results for the three and nine months ended September 30, 2023.
Net income after net movements in regulatory balances for the nine months ended September 30, 2023, was $119.5 million compared to $147.9 million for the comparable period in 2022. The decrease over the prior period was primarily due to lower amounts deferred into regulatory accounts, higher financing costs and higher operating expenses. This was partially offset by higher distribution revenue, other gains, lower depreciation and amortization expense and higher other revenue.
The Corporation is continuing with critical work in its grid investment plan to maintain safety and reliability, support a growing city, enable clean energy, and prepare for and respond to extreme weather.
Selected financial highlights (in millions of Canadian dollars) | ||||
Three months ended September 30 | Nine months ended September 30 | |||
2023 $ | 2022 $ | 2023 $ | 2022 $ | |
Distribution revenue | 219.9 | 194.8 | 629.1 | 568.8 |
Net income after net movements in regulatory balances | 39.3 | 55.0 | 119.5 | 147.9 |
Capital expenditures | 202.3 | 170.5 | 541.7 | 483.0 |
The unaudited condensed interim consolidated financial statements and related Management's Discussion and Analysis (presented in Canadian dollars) are available on the Corporation's website (torontohydro.com) or through SEDAR+ (sedarplus.ca).
CORPORATE DEVELOPMENTS
On August 25, 2023, Toronto Hydro-Electric System Limited (THESL) filed the 2024 rate application seeking the Ontario Energy Board (OEB)'s approval to finalize distribution rates and other charges for the period commencing on January 1, 2024 and ending on December 31, 2024.
On October 12, 2023, the Corporation issued $200.0 million of 5.13 per cent senior unsecured debentures due on October 12, 2028.
On November 15, 2023, the Board of Directors of the Corporation declared a dividend in the amount of $24.5 million with respect to the fourth quarter of 2023, which is payable to the City of Toronto by December 29, 2023.
On November 17, 2023, the maturity date of the Corporation's revolving credit facility was extended from September 17, 2027 to September 18, 2028.
On November 17, 2023, THESL filed a Custom Incentive Rate-setting application seeking the OEB's approval of electricity distribution rates and charges effective January 1, 2025, and subsequent annual rate adjustments based on a custom index specific to THESL for the period commencing on January 1, 2026 and ending on December 31, 2029. The application requests distribution rate increases necessary to fund a capital expenditures plan of approximately $3.9 billion and an operational expenditures plan of approximately $1.9 billion over the 2025-2029 period subject to inflationary adjustments via a custom index. The rate application also seeks approval to include in THESL's rate base capital amounts that were incurred during the 2020-2024 period.
ABOUT TORONTO HYDRO
The Corporation is a holding company which wholly owns two subsidiaries:
- Toronto Hydro-Electric System Limited (THESL) – distributes electricity; and
- Toronto Hydro Energy Services Inc. – provides streetlighting and expressway lighting services in the city of Toronto
The principal business of the Corporation and its subsidiaries is the distribution of electricity by THESL, which owns and operates the electricity distribution system for Canada's largest city. Recognized as a Sustainable Electricity Leader™ by Electricity Canada, it has approximately 791,000 customers located in the city of Toronto and distributes approximately 18 per cent of the electricity consumed in Ontario.
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FORWARD-LOOKING INFORMATION
Certain information included in this news release constitutes "forward-looking information" within the meaning of applicable securities legislation. The purpose of the forward-looking information is to provide management's expectations regarding the Corporation's future results of operations, performance, business prospects and opportunities, and may not be appropriate for other purposes. All forward-looking information is given pursuant to the "safe harbour" provisions of applicable Canadian securities legislation. The words "can", "could", "will" and similar expressions are often intended to identify forward-looking information, although not all forward-looking information contains these identifying words. The forward-looking information reflects management's current beliefs and is based on information currently available to the Corporation's management. Specific forward-looking information included in this news release includes, but is not limited to, payment of dividends to the City of Toronto as shareholder.
The forward-looking information is subject to risks, uncertainties and other factors that could cause actual results to differ materially from historical results or results anticipated by the forward-looking information. The factors which could cause results or events to differ from current expectations include, but are not limited to: risks associated with the execution of the Corporation's capital and maintenance programs necessary to maintain the performance of our distribution assets and make required infrastructure improvements, including to deliver a modernized grid and meet electrification requirements to achieve government net zero greenhouse gas emissions targets; risks associated with electricity industry regulatory developments and other governmental policy changes, including in respect of net zero greenhouse gas commitments; risks associated with the timing and results of regulatory decisions regarding the Corporation's revenue requirements, cost recovery and rates; risk that the Corporation is not able to arrange sufficient and cost-effective debt financing to fund capital expenditures and other obligations; risk of downgrades to the Corporation's credit rating; and the impact of macroeconomic factors (such as inflation and the interest rate environment) and economic conditions on the Corporation's operating results and financial position in the future.
Some of the factors that could cause actual results to differ materially from historical results or results anticipated by the forward-looking information, including some of the assumptions used in making such statements, are discussed more fully in the Corporation's filings with the securities regulatory authorities in Canada, which are available through SEDAR+ (sedarplus.ca).
All forward-looking information in the news release is qualified in its entirety by the above cautionary statements and, except as required by law, the Corporation undertakes no obligation to revise or update any forward-looking information as a result of new information, future events or otherwise after the date hereof.
SOURCE Toronto Hydro Corporation
