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Introduction & Market Context
Emera Incorporated (TSX:EMA) reported strong second-quarter 2025 results on August 8, showcasing significant growth in adjusted earnings and operating cash flow. The company’s stock has responded positively, with shares closing at $66.11 on August 7, representing a 1.85% increase and approaching its 52-week high of $66.17.
The utility company continues to demonstrate momentum across its operations, particularly in its Florida Electric segment, while maintaining its confidence in 5-7% average adjusted EPS growth through 2027. This performance builds on the strong first quarter results reported earlier this year, where Emera posted a record Q1 adjusted EPS of $1.28.
Quarterly Performance Highlights
Emera reported a substantial 49% increase in adjusted earnings per share for Q2 2025, rising to $0.79 from $0.53 in the same period last year. Year-to-date adjusted EPS reached $2.07, compared to $1.28 for the first half of 2024, representing a 62% increase. Operating cash flow before changes in working capital (excluding fuel and storm cost deferrals) grew by 32%.
As shown in the following chart detailing the company’s quarterly financial performance:
The company’s reported EPS remained flat year-over-year at $0.45 for Q2, while year-to-date reported EPS increased significantly from $1.17 to $2.41. This difference between adjusted and reported figures is primarily due to mark-to-market losses after tax and charges related to the pending sale of New Mexico Gas.
Growth Drivers
Several key factors contributed to Emera’s strong Q2 performance. The Florida Electric segment was the largest contributor, adding $0.25 to the quarter’s adjusted EPS, with $0.05 of that coming from favorable weather conditions. Corporate contributions added another $0.08, while Canadian Electric utilities contributed $0.09.
The detailed breakdown of these growth drivers is illustrated in this waterfall chart:
For the first half of 2025, the performance trend continues with Florida Electric leading the way with a $0.49 contribution to adjusted EPS growth. Corporate added $0.14, while Gas Utilities and Infrastructure contributed $0.08. The year-to-date performance across all business segments is shown here:
Capital Investment Strategy
Emera emphasized that essential investment remains the foundational driver of its growth strategy. The company has outlined a comprehensive five-year capital plan totaling $20 billion through 2029, which is expected to drive rate base growth of 7-8% during this period.
The company’s investment priorities are clearly illustrated in this slide:
A significant portion of this investment (55%) is targeted at transmission, distribution, and gas infrastructure to support reliability and customer growth. The capital plan is heavily weighted toward US operations, which account for approximately $16.7 billion of the total $20.4 billion planned expenditure.
Regulatory Updates
Emera reported important progress on the regulatory front, particularly with Peoples Gas. The company reached a comprehensive agreement on August 6, 2025, with the settlement expected to be filed later in August. The revised base revenue requirements amount to $86 million USD in 2026 and $27 million USD in 2027, with new rates expected to take effect on January 1, 2026.
Regarding the previously announced sale of New Mexico Gas, the regulatory hearing has been rescheduled to begin on November 3, 2025, with the transaction expected to close in early 2026. This strategic divestiture aligns with Emera’s focus on its core operations.
Forward-Looking Statements
Emera remains confident in achieving 5-7% average adjusted EPS growth through 2027, building on its strong performance in the first half of 2025. This growth projection is supported by the company’s substantial capital investment plan and expected rate base growth.
The company’s growth trajectory is visualized in this forward-looking chart:
The projected adjusted EPS shows growth from $2.94 in 2024 to between $3.43 (5% CAGR) and $3.63 (7% CAGR) by 2027. This outlook is underpinned by Emera’s continued investment in essential infrastructure and renewable energy integration.
Strategic Initiatives
Emera’s capital plan includes significant investments in renewable energy integration, with $2.08 billion allocated to solar projects at Tampa Electric and $870 million for energy storage. The company is also investing in technological innovation, with $1.7 billion earmarked for strategic customer-focused growth opportunities.
The breakdown of capital projects demonstrates Emera’s balanced approach to reliability, renewable energy, and innovation:
This strategic allocation of capital reflects Emera’s commitment to modernizing its infrastructure while supporting the transition to cleaner energy sources. The emphasis on reliability and grid modernization ($13.17 billion) underscores the company’s focus on maintaining service quality while pursuing growth opportunities.
In conclusion, Emera’s Q2 2025 results demonstrate strong operational performance across its business segments, with Florida Electric emerging as a key growth driver. The company’s substantial capital investment plan and regulatory progress position it well to achieve its targeted 5-7% adjusted EPS growth through 2027, despite challenges such as interest rate uncertainties and ongoing regulatory processes.
Full presentation:
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