Good morning, ladies and gentlemen, and welcome to today's special Emera conference call. At this time, all lines on the listen-only mode. Following the presentation, we'll conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Friday, June 28, 2024. I would now like to turn the conference over to Dave Bezanson. Please go ahead. Thank you, Julie, and thank you all for joining us for this conference call and live webcast. A little over an hour ago, Emera announced a change aimed at enhancing long-term shareholder value through a strategic update we made to our growth guidance and our dividend growth rate. Joining me to discuss these developments is Scott Balfour, Emera's President and Chief Executive Officer, and Greg Blunden, Emera's Chief Financial Officer. Before we begin, I'd like to advise you that this morning's discussion will include forward-looking information, which is subject to the cautionary statements contained in Emera's Q1 2024 MD&A and in Emera's press release issued earlier today. Today's discussion will also include references to certain non-GAAP financial ratios. As noted in today's press release, you should refer to Emera's Q1 2024 MD&A for further information on non-GAAP financial measures and ratios. Today's press release and Q1 2024 MD&A are available on Emera's website at emera.com. Now I'll turn things over to Scott. Thank you, Dave, and good morning, everyone. We appreciate you joining us for today's call, particularly those of you in Canada who are dialing in on a Friday of a long weekend. This week, Emera held its annual board of directors strategy session, during which we reviewed the diverse growth opportunities that lay ahead. We left these sessions with renewed confidence in our market position, our ability to meet customer and stakeholder expectations, and our potential to enhance value for our shareholders. The decisions we announced today, this morning reflect our fundamental confidence in the future of our company. Today, I'll outline some of these opportunities and the steps we're taking across our businesses to deliver them for our shareholders. As part of our strategic review, we are introducing new three-year EPS average growth targets of 5%-7% through 2027, based on current consensus for 2024. We're also extending our previously announced rate base guidance of 7%-8% over 5 years, taking us through 2029. We also announced an adjustment to our dividend growth rate guidance. This is a key step in our broader strategic initiative to reallocate capital towards the high-growth opportunities that underpin our business. By targeting a dividend growth rate of 1%-2%, we aim to continue to deliver long-term value by funding more of our robust rate base growth with internally generated cash flows from the high-growth jurisdictions where we operate. Together, these measures set Emera on a path to reduce our dividend payout ratio of adjusted net income to approximately 80% by the end of 2027, with continued improvement in the following years. These are significant steps in ensuring the sustainability of our dividend while positioning the company for robust future growth. Let me be clear: The decision to change our forecasted dividend growth rate in no way affects the current dividend amount. Something you've heard me say in the past is untouchable, nor does this change our ongoing commitment to keep growing our dividend. Emera shareholders can continue to expect dependable and growing dividends, underpinned by our prudent financial management and disciplined capital allocation. Our new dividend growth rate target delivers on that commitment to shareholders, while also better positioning us to finance our robust investment opportunities and is an important step forward to reduce our payout ratio over time. This positioning is exciting and positive, as several key trends are converging to shape a new future for regulated utilities, making it a pivotal time for investment. These trends include the push for decarbonization and electrification, the growing need for resilience against climate-related challenges, and the increasing overall demand for electricity. The capital required to meet these demands is at unprecedented levels, providing a strong foundation and trajectory for continued growth. With a stronger balance sheet, a disciplined capital investment plan, and a premium portfolio of assets located in high-quality jurisdictions in North America, Emera is well positioned to meet this moment. Florida, where we own two leading utilities, offers particularly compelling opportunities, and I will spend a moment outlining what we're seeing in the state. Florida's population growth in recent years has been remarkable. More and more people are moving to the Sunshine State. In fact, approximately 1,500 people are moving to Florida every single day, and Florida's economy continues to strengthen. If Florida were a country, it would have the 15th largest economy in the world. This economic and population growth is bolstering Emera's growth. Given the extensive service areas covered by Tampa Electric, as well as Peoples Gas, which is the largest local distribution company in the state. This influx of new customers has directly translated into increased demand for both electricity and natural gas across the residential and commercial sectors. We expect Peoples Gas will be our second-largest contributor to Emera in 2024, behind Tampa Electric, which is today our largest, at just over 50% of our earnings. Our investment focus in Florida is about servicing the strong economic and population growth, supporting ongoing electrification trends, and enhancing reliability and resilience for customers. We plan on investing 75% of our capital program in Florida. However, Florida is not the only area where we see potential. We're seeing growth in New Mexico, and we will continue to invest in Nova Scotia with a focus on reliability. Nova Scotia is another region experiencing rapid growth, coupled with a legislative need for decarbonization. By continuing our investments across these high-potential areas, we aim to achieve a rate-based growth of 7%-8% over the next 5 years. We are also expecting 2 rate case decisions this year at New Mexico Gas and Tampa Electric. As we look ahead to these milestones, and to provide additional clarity to investors, we'll begin sharing detailed 5-year capital investment and rate-based growth forecasts with our next annual update later in 2024. In bringing our ambitious growth plans to life, our funding plan remains unchanged. We're using internally generated cash flows, debt raised at the operating company level, equity, and select asset sales. An important part of our work in 2024 has been to strengthen our balance sheet with a clear focus on improving credit metrics this year and beyond. We have accomplished what we said we would do, and we're ready to turn our attention to executing on the growth opportunities that are ahead of us. This quarter has been a busy and productive one for Emera. In early April, CAD 117 million of Nova Scotia Power's unrecovered fuel and purchased power costs were securitized by the Province of Nova Scotia. Nova Scotia Power has been financing the rising and fluctuating cost of fuel and purchased power on behalf of its customers over the last few years in an effort to reduce the volatility of rate impacts. This securitization allows for a reduction in the near-term rate impacts for customers from the necessary recovery of these costs, and in turn, reduces the debt and leverage levels for Nova Scotia Power and Emera. Nova Scotia Power is working with government partners on additional securitization efforts for further risk mitigation benefits for customers and debt reduction for the business. On June 4, we closed a CAD 1.19 billion transaction that transferred our equity interest in the Labrador-Island Link to KKR. This supports our capital investment plan over the 2024-2026 period. We previously indicated we would fund up to 15% of the capital plan through asset sales, and with this single transaction, we successfully met that objective. This transaction improves our 2024 credit metrics by 60 basis points. Finally, on June 18, we completed a $500 million issuance of hybrid notes. The net proceeds were principally used to repay our $300 million notes that matured on June 15, 2024. This financing will receive 50% equity treatment by the credit rating agencies, further reducing holding company leverage and improving 2024 credit metrics by 20 basis points. Together, these three actions reduced our consolidated debt by approximately $2 billion and will improve our 2024 credit metrics by almost 100 basis points. These actions are evidence of our commitment to improve the financial strength of our company. Once again, shows our willingness to execute on big decisions, while we also continue to have valuable and ongoing optionality in our portfolio. This disciplined approach to capital allocation and portfolio optimization underpins our strategy and decision making and ensures we are well-positioned to deliver value to shareholders and to capitalize on the opportunities ahead. Beyond these recent opportunities, there are several other catalysts that give us confidence in delivering on our ability to fund our capital plan. The many initiatives we've taken across the business have resulted in considerable progress on reaching our key credit objectives, which are to maintain our investment-grade credit ratings, which are critical to our long-term financial health and to minimize our cost of capital. To maintain our target capital structure, to ensure we have a balanced approach between debt and equity, providing us with the flexibility to manage market fluctuations. To sustain cash flow to debt metrics above 12%, which demonstrates our ability to generate sufficient cash flow to cover our debt obligations comfortably. And to keep our holding company debt to total debt ratio below 35%, down dramatically from its peak of 56%, as it was just a few years ago in support of the acquisition of TECO. An additional note on asset sales. As we indicated earlier this year, we launched two asset sale processes to the market in 2024, with an expectation that at least one would advance and be announced by mid-year. We successfully achieved that objective with the LIL transaction, which successfully closed in June, with immediate positive impact on our balance sheet and credit metrics. While the second asset sale process remains active, it may or may not ultimately result in a transaction... We will proceed with asset sales only when transactions meet specific criteria, including clear return thresholds and delivering value to shareholders. To conclude, this is a very exciting time for Emera, for the industry and for Emera. With an optimized portfolio of well-performing, well-run operating companies, each of which intently and effectively meet the evolving needs of their customers, we are well-positioned to capture the opportunities ahead and deliver value to shareholders. In addition to ongoing dividend growth, we're targeting average EPS growth of 5%-7%. We're committed to ensuring we have a strong balance sheet with a stable credit rating. We've been delivering on our clear and disciplined value enhancement plan, making progress on all fronts. With a number of additional upcoming catalysts, including the pending rate case decisions, we have every confidence that we will continue to enhance long-term value for our shareholders. Once again, thank you for joining us on Friday morning before a long weekend. This is an important announcement. I wanted to make sure that you had the opportunity to hear it from me. If I don't have the opportunity to talk or see you again before our earnings call, I hope you have a great summer. With that, Greg and I are happy to take your questions. Thank you. Ladies and gentlemen, if you'd like to ask a question, please press star one. If you'd like to withdraw your question, press star two. Again, to ask a question, press star one. One moment please, for your first question. Your first question comes from Rob Hope from Scotiabank. Please go ahead. Good morning, everyone. First question is, is just maybe can you walk us through the thinking of, you know, announcing this today, having this call today, meanwhile, the asset sale or the second asset sale program continues to progress. Is that, does that reflect uncertainty in that asset sale being completed, or should we think of it as, you know, the asset sale will be neutral to EPS and as such, wouldn't impact future guidance, at least on the EPS side? Yeah, I think, Rob, whether we see a second asset sale or not, it would not be impacting our view of the guidance that we just announced. And then can you comment on discussions with rating agencies? You know, have they, you know, were they brought inside the tent on this one, as well as maybe comment on, you know, following the LIL sale, you know, their view that, you know, they would prefer to see some additional asset sales? Yeah, Rob, it's Greg. Good morning. Yeah, I mean, we have regular dialogue with the rating agency, so they would have been brought up to date in advance of this morning's press release in terms of what the content of that press release would indicate. Look, our conversations remain constructive with the rating agencies. Obviously, as Scott indicated, we've made a lot of progress, in particular, in the last quarter. And you know, I think that's very much in line with their expectations. You know, the second asset sale that most people are speculating would not have any impact on 2024 credit metrics, irrespective of whether or not it transacted or not, because of the regulatory approvals that would likely come with such an asset. But all to say is I think we're in a good spot. I'm not surprised that they haven't taken action yet. They will be, you know, a little bit more conservative. That's their nature, and that's fine. But we are extremely confident that we're going to hit our targeted threshold credit metrics in 2024. Thank you. I'll hop back in queue. Okay, thanks, Rob. Your next question comes from Maurice Choy from RBC Capital Markets. Please go ahead. Thank you, and good morning, everyone. Just sort of follow up on the guidance, part of it. So the 5%-7% EPS growth, I suppose, is based off 2024. If NMGC happens, does the 2024 base year get rebased, let's say, lower, for any dilution? Yeah, Maurice, it's Greg. I won't comment on a specific asset sale, but how Scott may have answered a previous question. Irrespective of whether or not a transaction, a second asset sale happens, we are still confident that the EPS guidance we've provided off of 2024 would remain intact. Understood. And just so I understand, beyond this potential asset sales, you did mention in your press release that you are going to continue looking at your portfolio in terms of optimizations. Can you just discuss what that meant, perhaps beyond the current asset sales that you're looking at? Is there anything else? Yeah, Maurice, it's Scott. Really there, we're just getting back to the position that we've always been in, where we continually review our portfolio with a view to exploring, determining sort of the appropriate allocation of capital. And as I said, you know, we're blessed with a portfolio that has some optionality in it, and so it's really more of an ongoing process as opposed to you know, the more time-defined specific process that we've been speaking about for the last couple of quarters. On an ongoing basis, as we always have, we'll continue to review the portfolio, and if we see opportunities for capital recycling that it makes sense for shareholders, we'll continue to explore them as we always have. But really getting back more to an ordinary course discipline as opposed to the focused effort that we spoke to over the last couple of quarters, that ultimately concluded with the transaction on the Labrador-Island Link, that from our perspective was fabulously successful. But to follow up, when you mentioned earlier that you project that your credit metrics will go above 12% and beyond, that is mainly on organic cash flow growth rather than any further asset sales. Is that a fair statement? Well, we'd say it this way, Maurice. You know, there's multiple paths can always take you there, but certainly, we're comfortable with, given the steps we've taken, we're comfortable with the organic path. But we always look at, you know, how does that organic path compare to, the opportunity to potentially recycle capital? You know, there's other assets in our portfolio that have been speculated on occasion in the past, and, you know, I think that's fair and reasonable. Scott also highlighted that we're having continuing conversation about additional fuel securitization. So, there's, you know, multiple paths that get you there, but all to say is we're comfortable each and every one of those paths accomplish it, our objectives. Yeah, maybe just to tie all this together, Maurice, you know, as you know, we would have some components to our portfolio that investors would speculate or, you know, as to the long-term fit within the portfolio, some smaller assets that, you know, we'll always look at those opportunistically, if there's an opportunity to transact and enhance value. But we're not looking at that kind of thing in relation to achieving credit metrics for 2024. Really, the key message today is that, you know, we've got confidence in the path that we're on, and we're turning the page, focusing on execution, focusing on capturing the growth opportunities that we've got with shareholders. Communicating that through the introduction of clarity around EPS growth, as we've announced, and also, you know, taking the disciplined, prudent decision to moderate the growth rate of our dividend to ensure that we are optimizing how we're investing the cash flow generation that the business has in order to invest in those growth opportunities. So that really is the core message that we're trying to convey to investors today. Got it. Just to finish up, I understand your path to the 12%. I think Moody's had you at 9.8% by the end of 2023. I think, Scott, you mentioned earlier that the LIL sale and the hybrid issuance gets you almost 100 basis points, so let's call it 10.5, 10.8. Is the remaining 120 basis points, let's say, half potential sale and half between the Tampa Electric rate case and anything beyond that, let's see, too much cherry on the cake? Yeah, I think there's a couple of things also to keep in mind. I mean, there is a substantial step up in cash flows at People's Gas this year, Maurice, from the successful rate case outcome we had, so you have to build that in. We will anticipate to have new rates at New Mexico Gas in the fourth quarter of this year. And of course, the trailing twelve months at year-end last year incorporated what was a, you know, relatively soft Q4, in particular because of weather at Tampa Electric. So if you take all of those things combined, it's a combination of the actions we're taking to reduce debt, but also, you know, what we're seeing from our business and the growth of cash flows just in an organic basis. Got it. Thank you very much. You're welcome. Your next question comes from Ben Pham from BMO. Please go ahead. Hi, good morning. A couple of questions on the dividend. Can you walk through the thought process of how you got to 1%-2%, and, and why, why not just not grow at all? And then can you talk about, is there a time frame that this, the new growth rate translates to, and is, is 80% the right level now for Emera? Hey, Ben, thanks, thanks for the question. So, look, you know, we made a determination that, you know, reducing the dividend growth rate was prudent, but that it was still important to deliver growth in dividends over time. And so with that commitment is what led us to the 1%-2%, as opposed to something that is, you know, that was lower or higher than that. And, you know, I think that really is part of continuing to convey the prudence and discipline around the allocation of capital, but still remaining focused on delivering value to shareholders, including an increasing dividend. And I'm sorry, Ben, I've forgotten the second part of your question. Timeframe. Oh, the timeframe. Yeah. So we didn't bound it with a timeframe, Ben, and, you know, the eighty percent reference is really just, you know, providing some clarity and focus in terms of the meaningful progress that we expect to make in the reduction of the payout ratio. Of course, you know, you can do that math against the 2024 consensus and look at that 5%-7% target growth. And I would remind you that that growth is on average. That doesn't mean it'll be between 5%-7% each year of those three years. ... could be some years that are lower and some years that are higher, but we are confident over the three-year period that we will see that level of growth. And we would expect, as I said, that that dividend payout ratio will continue to come down further toward what we've historically described as our payout ratio, target payout ratio of 70%-75%. But even that's something we'll continue to look at. We're looking to, you know, ensure we're in line with our peers on our payout ratio, and we'll continue to assess that over time. But really the focus of this is to make sure that we're using as much internally generated cash flow as we can to invest in the high growth opportunities that are in front of us and deliver that value to shareholders through earnings growth. Okay, thanks for that. Maybe, maybe a cleanup question on the EPS guidance. Can you share what's FX assumption that you're, you're using in that? And I, I notice that you have a scenario of 7% EPS growth, which is quite similar to rate base growth, despite the, the, the DRIP in ATM still in that, that plan. Is, is that more consistent, narrowing between the two? Is that, that expectations in the rate case outcomes driving a bit of a better boost in earnings? So Ben, I caught all of that except, it's Greg. I caught all of that except for the very first part of your question, which might have been the most material part of your question. So, could you just repeat the first part of your question again, Ben? Yeah, definitely. I was, like, I was asking what is your USD FX assumption? Oh! Oh, sorry. Yeah, we're assuming that that you know, coming off of 2024 and going forward, that would be a constant FX. So, you know, we're at, kind of, at the 1.35 level. Okay. And then can you talk about, more directly in that 7% EPS growth scenario, why it's close to rate base growth when you got the, your share count, rising gradually over time? Yeah. I mean, what could cause it to go, you know, towards the top end of the band or the lower end of the band in any given year? You know, it's not so much about the share count perspective, but it's probably more about the performance of the operating entity. So if you get a year that will likely push EPS growth up a little bit higher, and I would say the opposite is also true. So it's less about the financing of the business or the rate-based growth, but more within the range of what we would expect from the performance of the businesses. Okay, got it. Thank you. You're welcome. Your next question comes from Mark Jarvi, from CIBC Capital Markets. Please go ahead. Yeah, good morning, everyone. If you, if you take the midpoints of the, of the growth in the dividend at 1%-2% in the EPS, kind of, track towards more like a mid-80% pay ratio. So when you're talking about getting towards 80% in 2027, is that the confidence that you can hit the top end of the EPS growth, and then you'll be at the low end of the dividend growth? Mark, it's Greg. I think it's a little premature to guide towards the top end. But, look, when we model out where we are now expecting our dividend growth to be and the confidence we have in the EPS growth, you know, I think the way that Scott's characterized it is probably the best place to leave it, is we would, we are targeting to be around the 80% or very close to it, by the end of 2027. Then just coming back to comments about, you know, being able to drive that EPS growth with or without asset sales, not being too impactful. So just what would be sort of the assumptions around ATM usage going forward? And then if you did, is the view then the ATM usage with the dilution that that comes, is largely equivalent to what you'd think from an asset sale? Or if you did see an asset sale, is it possible that you're more at the lower end of the 5%-7% range? Yeah, You know, I think it's tied in a little bit, Mark, to the comments on whether an asset sale would have a material impact on EPS. And as we indicated, we don't think it would materially move the numbers. So I think you can probably assume that whether you raise that equity to an ATM or an asset sale, it's just not gonna have a meaningful impact on what we expect from an EPS growth over the forecast period. In terms of some details around the funding plan, we'll be rolling out our funding plan, consistent with what we historically have done when we roll out our updated rate base plan later this year. Okay. And then in your guidance, what's the assumption on the outcome of the TECO rate case? Again, is there anything you can share in terms of what that would be? Is it, you know, assuming that you get all the requests, 30% haircut, is there anything you can kind of say that's kind of built into that guidance? Yeah, we're not. I'm not gonna speculate on what the outcome of the rate case would be. We feel very good about what we have filed with the Florida Public Service Commission. The process is underway, but it wouldn't be appropriate to comment on an active rate case at this point in time. I figured as much, but I gotta try at least. And the last question, when would we know for sure whether or not another asset sale, you've exhausted that process and you're done? Is there something you could say by the time we get to Q2 earnings in August, that you'll have a definitive answer whether or not you move forward or you put that to rest? Yeah, I mean, I wouldn't want to put it, sort of, be in the same place where we've got a time bound to it, Mark. I understand, I certainly understand the question, but look, I mean, you know, if we get to a transaction, certainly, you know, we will, we will immediately announce it, and if we don't, we, we, we won't. ... I I would be surprised if on our Q2 call, get asked the question, if there hasn't been an announcement, and certainly we'll deal with it then. But I don't really want to start to think about trying to put a time expectation on this. Really, what I'm saying is that, you know, we may or may not transact on the second asset sale. We'll only do it if we deem it to be in the interest of shareholders over the long term. And if we don't get to that place, we will not transact with confidence, as I say, that we are, that we've turned the page, that we're, you know, in the right place now as it relates to our balance sheet and our credit metrics, and obviously confident enough to be clarifying to the market our expectations around delivering the growth that we see in investment opportunities, and the translation of that into earnings and reduction of payout ratio over time. Okay, thanks for the time today. Have a great long weekend. Yeah, thanks, Mark. Ladies and gentlemen, as a reminder, should you have a question, please press star one. Your next question comes from Patrick Kenny from National Bank Financial. Please go ahead. Hey, good morning, guys. I just wanted to follow up here on, I think it was Ben's question. And I appreciate not wanting to be bound by any specific timeframe as it relates to the 1%-2% dividend growth. But, you know, assuming your peers maintain their existing dividend growth rates over the coming years, would it be your goal, I guess, to return to a mid-single digit dividend growth rate, perhaps, you know, after 2027, after your payout ratio meets your 80% target? Or should we just view this as, the plan is to keep the 1%-2% growth rate here for good? Yeah, you know, I don't think either of those things, Patrick. I think, you know, in the middle, certainly, you know, we have it time-bounded. I wouldn't want to be in a place where we're saying we'd be looking to increase the dividend growth rate at 2027. I would not set that as an expectation. Our objective would be to get the payout ratio down within the 70%-75% range, which has historically been our target payout ratio, and then we'll, you know, we'll reassess at that time, based upon where our peers are, based upon where our opportunities are. But our objective would be to get it into the low 70s%, which, you know, which of course, you can do the math and run that out over a period beyond 2020, 2027. But, you know, our first focus is there, and, you know, we'll continue to reassess the dividend level. As you know, of course, dividend rates get determined by the board of directors. It's an ongoing conversation that, you know, we have with the board, but it'd be premature to speculate on when the growth rate might increase again. But I would not set an expectation that would happen once we got to 80%. Got it. Okay. Then just back to the asset sales, and I guess understand how you would the process play out, just given the amount of work. I'm sure there's a lot into it. But just given your confirmation in the press release that, you know, the disposition of LIL satisfies your 15% fund there. If you view this second asset sale as being perhaps more tied to accelerating your growth plan, you know, perhaps tied to sanctioning that $2 billion of potential CapEx over and above your base plan. Or is it more just viewing the incremental proceeds as perhaps, you know, as you said, adding shareholder value just by further enhancing your balance sheet metrics? Yeah, really, I think, yes, it's got a financial lens to it. It's also got a strategic lens to it, and it's really a matter of whether we see a transaction that is in shareholder interest over the long term, both as it relates to the strategic and financial impacts of that transaction. And if we see a transaction that crosses that threshold, then we'll proceed. And if we don't, then we'll continue to retain the asset and continue to deliver growth and value to shareholders with benefit of that asset continuing. It's what I mean when I say we're blessed with a, you know, a portfolio that gives us some optionality. And, you know, we have confidence in all of the assets that we have in our business, and, you know, the opportunity to transact, to sell one, we will only do when we see it as in the best interest of shareholders. And, at this point, with that second asset sale, it's not sure whether we will cross that threshold or not. Okay, that's great. Thanks for your comments, and have a great weekend. Thanks, Patrick. There are no further questions at this time. I will turn the call back over to Dave Bissonnette for closing remarks. Thank you all for joining us today on such short notice. We appreciate your interest and support of Emera. If you have any follow-up questions, please reach out to the investor relations team. We'll be happy to find a time to connect. Have a great day and a great long weekend. This concludes today's conference call. You may now disconnect. Thank you.