Financial Performance Overview

NextEra Energy (NEE) reported mixed results for the three and nine months ended September 30, 2024. Net income attributable to NEE increased by $633 million for the three-month period, but decreased by $357 million for the nine-month period.

The increase in net income for the three-month period was driven by higher results at Florida Power & Light (FPL) and NextEra Energy Resources (NEER), partially offset by lower results at the Corporate and Other segment. The decrease in net income for the nine-month period was due to lower results at Corporate and Other, partially offset by higher results at FPL and NEER.

FPL: Steady Growth

FPL’s net income increased for both the three and nine-month periods, primarily due to continued investments in plant and other property, which grew the utility’s average rate base by approximately $6.0 billion and $6.4 billion, respectively, compared to the prior year periods. This reflects additions to solar generation, transmission, and distribution infrastructure.

FPL also completed a 12-month interim storm restoration charge in 2023 related to Hurricanes Ian and Nicole, which impacted the utility’s service area. In the third quarter of 2024, FPL’s service territory was hit by Hurricanes Debby and Helene, and in October 2024, Hurricane Milton, resulting in additional recoverable storm restoration costs.

NEER: Improved Performance

NEER’s results increased significantly for the three-month period, primarily due to the absence of an impairment charge related to the investment in NextEra Energy Partners (NEP) recorded in 2023, favorable non-qualifying hedge activity compared to 2023, and higher earnings from new investments.

For the nine-month period, NEER’s results also increased, reflecting the absence of the NEP impairment charge and higher earnings from new investments, partially offset by less favorable non-qualifying hedge activity compared to 2023.

The key drivers of NEER’s performance include:

• New investments: Higher earnings from new wind, solar, and battery storage facilities that entered service.
• Existing clean energy: Slightly lower earnings from existing renewable energy assets.
• Gas infrastructure: Mixed results, with higher earnings from the pipeline business offset by lower earnings from the gas infrastructure business.
• Customer supply: Lower earnings due to the normalization of origination activity and margins compared to the prior year periods.
• NEET (rate-regulated transmission): Higher earnings from new rate-regulated transmission projects.

Corporate and Other: Weaker Performance

The Corporate and Other segment reported lower results for both the three and nine-month periods, primarily due to unfavorable non-qualifying hedge activity related to changes in the fair value of interest rate derivative instruments.

Liquidity and Capital Resources

NEE and its subsidiaries require significant funds to support and grow their businesses, which are primarily funded through a combination of cash flows from operations, short- and long-term borrowings, and the issuance of equity and debt securities.

As of September 30, 2024, NEE’s total net available liquidity was approximately $12.0 billion, consisting of $5.3 billion at FPL and $6.8 billion at NEECH (the NextEra Energy Capital Holdings subsidiary).

NEE and its subsidiaries also use various forms of credit support, such as guarantees, letters of credit, and surety bonds, to facilitate commercial transactions and financings. At September 30, 2024, these credit support arrangements totaled approximately $14.2 billion.

Outlook and Risks

NEE’s financial performance is subject to various risks, including commodity price risk, interest rate risk, equity price risk, and credit risk. The company uses a variety of financial instruments and strategies to manage these risks, such as derivatives, interest rate contracts, and diversified investment portfolios.

Looking ahead, NEE’s ability to maintain its strong financial position and execute its growth strategy will depend on its continued ability to access capital markets, manage risks effectively, and navigate the evolving energy landscape. Factors such as regulatory changes, weather patterns, and market conditions could all impact the company’s future performance.

Overall, NEE’s diverse portfolio of regulated and competitive energy businesses, combined with its focus on operational excellence and financial discipline, position the company for continued success, despite the challenges and uncertainties that lie ahead.