Avista Corp issues $120 million in first mortgage bonds due 2055

Avista Corp (NYSE:AVA), a utility company with a market capitalization of $3 billion and currently trading near its 52-week low, announced that on Wednesday it issued and sold $120 million of 6.18% first mortgage bonds due in 2055 in a private placement to institutional investors. According to InvestingPro data, the company maintains strong dividend credentials, having maintained dividend payments for 55 consecutive years. The bonds were issued under the company’s existing Mortgage and Deed of Trust, dated June 1, 1939, as amended, with Citibank, N.A. serving as trustee.

According to a statement in the SEC filing, the bonds are subject to redemption before maturity at the option of Avista Corp at a price equal to the principal amount plus a make-whole premium and accrued interest. The bonds are secured by a lien on substantially all company property, excluding excepted property. This new issuance adds to Avista’s existing total debt of $3.046 billion, with a debt-to-equity ratio of 1.15x.

In connection with the bond pricing, Avista Corp settled one interest rate swap derivative with a notional amount of $10 million, receiving a net amount of $1.1 million. The company stated that this amount will be amortized as a component of interest expense over the life of the debt.

The net proceeds from the bond sale are intended to repay borrowings outstanding under the company’s committed line of credit, which were used for the construction or improvement of utility facilities, or to reimburse the treasury for funds spent for these purposes.

The bonds have not been registered under the Securities Act of 1933 or any state securities laws and may not be offered or sold in the United States without registration or an applicable exemption.

This information is based on a statement in Avista Corp’s recent SEC filing.

In other recent news, Avista Corporation reported its first-quarter earnings for 2025, revealing an 8% growth in revenue year-over-year, reaching $603 million. However, the earnings per share (EPS) fell slightly short of analysts’ expectations, coming in at $0.98 compared to the forecasted $1. Additionally, Avista has announced a settlement agreement concerning its rate cases in Idaho, which, if approved, will implement rate adjustments starting in September 2025 and 2026.

Jefferies analysts have revised their price target for Avista’s stock from $44 to $40 while maintaining a Hold rating, noting changes in electric peer average 2027 price-to-earnings ratios and potential growth through request for proposal opportunities. In a strategic move, Avista has issued a request for proposals to secure up to 415 megawatts of capacity for winter and 425 megawatts for summer, aligning with Washington’s Clean Energy Transformation Act. This initiative aims to provide carbon-neutral electricity by 2030 and includes exploring demand response programs to enhance energy efficiency during peak usage times. These developments reflect Avista’s ongoing efforts to adapt to regulatory changes and meet growing energy demands.

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