Hawaiian Electric Industries Inc (HE) 2013 Q3 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the third-quarter 2013 Hawaiian Electric Industries, Inc. earnings conference call. My name is Denise, and I will be your operator for today. At this time, all participants are in listen-only mode. Later we will conduct a question-and-answer session. (Operator Instructions) As a reminder, this conference is being recorded for replay purposes.

I would now like to turn the conference over to your host for today, Shelee Kimura, Manager of Investor Relations. Please proceed.

Thank you, Denise. Welcome, everyone, to Hawaiian Electric Industries's third-quarter 2013 earnings conference call. Joining me today are Connie Lau, HEI President and Chief Executive Officer; Jim Ajello, HEI Executive Vice President and Chief Financial Officer; Dick Rosenblum, Hawaiian Electric Company President and Chief Executive Officer; and Rich Wacker, American Savings Bank President and Chief Executive Officer; as well as other members of senior management.

Connie will provide an overview; and then Jim will update you on Hawaii's economy, our results for the quarter, and outlook for the remainder of the year. We will conclude with questions and answers.

In today's presentation, management will be using non-GAAP financial measures to describe the Company's operating performance. Our webcast presentation materials, which are posted on our Investor Relations website, contain additional disclosures regarding these non-GAAP measures, including reconciliations of these measures to the equivalent GAAP measures.

Forward-looking statements will also be made on today's call. Actual results could differ materially from what is described in those statements. Please reference the forward-looking statements disclosure accompanying the webcast slides, which provides additional information on important factors that could cause results to differ. The Company undertakes no obligation to publicly update or revise any forward-looking statements, including EPS guidance, whether as a result of new information, future events, or otherwise.

I will now turn the call over to our CEO, Connie Lau.

Thanks, Shelee; and aloha to everyone. The unique combination of our businesses continues to deliver solid results. Our year-to-date consolidated earnings are in line with expectations for the year, and our consolidated core ROE for the trailing 12 months was 9.9%.

American Savings Bank continued to focus on loan growth, strong risk management, and expanded customer relationships. As a result, it continued to be a stable performer with solid profitability metrics, despite the challenges of an increasingly restrictive regulatory environment and low interest rates.

Hawaiian Electric continued its pursuit of more low-cost clean energy and cost efficiency in its effort to lower customer bills. In support of Hawaii's goal to reduce its dependence on imported oil, Hawaiian Electric is one of the nation's leaders in integrating clean energy, achieving record levels of renewable generation, which displaced the use of approximately 2.2 million barrels of costly imported fuel oil year to date -- the equivalent of $275 million.

As shown on Slide 3, third-quarter earnings were $0.48 per diluted share in 2013 compared to $0.49 per share in the prior-year quarter. Slightly higher consolidated net income, driven by higher bank earnings, helped offset lower utility earnings. However, EPS declined by $0.01 due to the increased number of shares issued through our dividend reinvestment program to support the capital needs of our utilities.

Year to date through September 30, more than 18% of the electricity used by utility customers came from renewable resources, exceeding the state's 2015 goal of 15%. On Hawaii Island, renewable generation is up to 49%, and Maui Electric is up to 30% year to date.

Consistent with the System Improvement and Curtailment Reduction Plan that we filed in early September for Maui, Maui Electric integrated 91% of the wind energy produced on the island in September, up from approximately 70% in the first half of the year, and is seeking to further improve upon that.

In order to accelerate the pace of reducing costs through renewable generation, earlier this year Hawaiian Electric invited developers to propose renewable projects on Oahu that will meet specific costs and timing requirements. The response was better than expected, and there are currently 9 utility-scale photovoltaic projects totaling 244 megawatts of capacity that we requested approval of waivers from competitive bidding from our PUC. We filed for 6 of these just last week. The average price of these projects is 30% below the avoided cost of oil generation; and if approved, we hope to get these projects in service between 2015 and 2018.

Further advancing our commitment to pursue more low-cost clean energy, our Oahu utility recently filed a request with the PUC to develop a 15-megawatt utility-scale photovoltaic system on land at our Kahe generating station. We are proposing to develop the project on land already owned by Hawaiian Electric to help to reduce the cost to customers.

The total cost of the project is $42 million; and based upon preliminary estimates, the project over its lifespan would reduce the overall cost of generating electricity on Oahu by $64 million. This is equivalent to a 20-year purchased power agreement with a price of $0.145 cents per kilowatt hour, which is about $0.08 less than the current cost of oil generation and lower cost than our negotiated purchase power agreement for wind or solar generation.

This project is a unique opportunity that benefits our customers, because it allows us to quickly develop more low-cost clean energy. While adding more low-cost renewable generation, we are starting to execute our plans to deactivate older, less-efficient oil-fired power plants.

The Honolulu power plant will be deactivated in the first quarter of next year, with plans to deactivate a total of 226 megawatts of utility-owned generation by 2016. And for our remaining oil-fired unit, we continue to work hard to bring LNG to Hawaii as a cleaner and lower-cost fuel alternative to the oil that would otherwise be used.

Turning to American Savings Bank on Slide 5, American's performance metrics remain in line or better than its target and peers. We have been able to maintain a competitive return on assets of 119 basis points through the first nine months of the year.

Year to date annualized loan growth was 9.3%. In the third quarter, loan growth was driven primarily by higher commercial and home equity loans. While we expect loan growth to moderate, we expect to exceed our mid-single digit target for the year.

Strong loan growth has helped offset the impact of the expected decline in net interest margin. Year-to-date net interest margin was 3.77%, and we expect to be at the higher end of our target range of 3.6% to 3.7% for the year.

Despite our strong loan growth, year-to-date credit costs are extremely low. Our continued good asset quality and strong risk management resulted in a year-to-date net charge-off ratio of just 6 basis points -- very attractive relative to peers. Overall, the Bank continues to maintain its low-risk profile, strong balance sheet, terrific funding base, and straightforward business model.

I will now ask Jim to provide additional detail and insights to our results and the outlook for the remainder of 2013.

Thank you, Connie. As a backdrop to our results and outlook, I will briefly comment on Hawaii's economy. Year to date, through September, visitor spending increased 4.1% to $11 billion; and visitor arrivals increased 4.5% to over 6 million. For the month of September, visitor arrivals fell for the first time in two years, as arrivals from the US declined and spending dipped.

Economists continue to monitor the impact of sequestration and the federal shutdown and expect tourism growth may moderate going forward, as that industry has regained a high level of inactivity. Statewide unemployment was 4.3%, with Honolulu at 3.8% in August, and remains low compared to the national average of 7.3% in August.

Oahu single-family homes sales and prices are up 7% and 3%, respectively, year to date through September 2013. And construction activity is adding to the economic rebound. Private building permits increased 6% year to date through August.

Going forward, we expect continued but more moderate growth in the Hawaii economy.

On Slide 7, utility net income for the third quarter of 2013 was $37.8 million compared to $38.4 million in the third quarter of 2012. The detailed variances are shown here, and I will just highlight a few.

Utility net revenues after tax were approximately $2 million higher. $4 million of increase at the Oahu utility for additional recovery of costs were offset by decreases at Maui Electric, primarily related to the 2012 final decision and order and lower fuel efficiency performance.

Operations and maintenance expenses after tax were approximately $2 million higher than the third quarter last year, largely due to the timing of plant overhauls and higher customer service expenses, partially offset by lower expenses for substation and generating station maintenance.

In this year we recorded a reversal of deferred tax liabilities of $3 million versus last year, when we had a favorable tax settlement of $1 million related to the prior years, for a net variance of $2 million.

At the Bank, net income for the third quarter of 2013 was $15.3 million, or $600,000 lower than the linked quarter, primarily driven by a $1 million after-tax fee income -- as expected under the Durbin Amendment, which placed a cap on interchange fees that became effective on July 1, 2013.

The aggregate impact of the credit card sale which occurred on August 1 in 2013 was nominal, as the roughly $600,000 net after-tax gain on the sale recorded in the third quarter was roughly equivalent to the $600,000 lower provision to loan losses related to the release of credit card reserves in the second quarter of 2013. We expect that the full-year net credit card gain will be largely offset by lower credit card related income for the remainder of the year.

The new credit card suite will enable the Bank to provide more attractive product features, including a better rewards program to both individuals and businesses, providing new customer growth opportunities in a historically declining product for American.

Compared to the second quarter of 2012, American's net income was $1.1 million higher. The primary after-tax drivers were, first, a provision for loan losses was $2 million lower, and American recognized the roughly $600,000 net gain on the sale of the credit card portfolio. Secondly, there was largely offset by lower banking income on gain on sales of loans and lower interchange fees due to the Durbin Amendment.

As shown on Slide 8, HEI's core ROE, or return on equity, for the last 12 months was 9.9%, with the equivalent ROE contributions from the utility of 8.1% and the Bank of 11.8%.

Turning to the utility, Slide 10 shows the utility's actual ROEs for the 12 months ending September 2013. The consolidated core utility ROE of 8.1% declined from 9% in September 2012, primarily due to higher O&M expenses and the impact of the withdrawn Hawaii Electric Light 2013 rate case. We expect the full-year 2013 ROE to be 7.8% to 7.9% after the fourth-quarter equity infusion from HEI to HECO.

The decline in the last 12 months' core ROE of our Oahu utility to 8.5% was primarily due to higher O&M. The ROE of our Hawaii Island utility had lower returns than the prior year, primarily due to higher O&M spending in advance of recoveries since a January 2013 settlement agreement resulted in the withdrawal of the 2013 test year rate case.

In addition, starting in April 2012, our Hawaii Island Utilities heat rate savings were significantly reduced with the implementation of the heat rate deadband. We expect that its ROE will generally and gradually weaken until its next rate case in 2016.

Core ROE of our Maui County utility of 8.2% reflects improvement due to the 2012 rate case that became effective in June 2012.

On Slide 11, I will go over a few more business updates for the utilities since the last quarter. We expect the 2013 annual capital expenditures to be approximately $30 million lower than originally planned. Consistent with Hawaiian Electric's recent announced plans for the deactivation of older, less efficient generating units, we are evaluating some of our generation-related projects and have held off on certain CapEx projects in 2013.

Similarly, as we further pursue LNG to help lower customer bills, we have not made planned investments in fuel infrastructure. Our rate base growth expectation remains at 5% for the year. We plan to provide an updated five-year CapEx forecast in next quarter's earnings call.

Last month the utilities refinanced $166 million of debt at lower interest rates. The weighted average interest rate of the new debt was 4.6% compared to the debt replaced, which was 5.4%. Utilities also issued $70 million of new debt at a rate of 5.65%, with 30-year maturities.

With respect to the utilities' decoupling model in October, PUC set forth a procedural schedule for the decoupling investigation docket to review whether the coupling mechanism is functioning as intended. There were two categories of issues to be reviewed, with separate procedural schedules.

The first category includes those issues that will follow an expedited schedule, so they could be resolved in time for implementation of the utilities' annual decoupling submittals due on March 31, 2014. The second category includes issues to be addressed pursuant to the longer-term schedule.

I will now discuss the Bank. On Slide 13, our net interest margin of 3.73% in the third quarter of 2013 was 6 basis points lower than the linked quarter. Total asset yield declined by 7 basis points, attributed largely to lower yields on loans and lower levels of commercial loan prepayments and associated fees, which were partially offset by a favorable asset mix. Our liability costs remain extremely low at 22 basis points, unchanged from the prior quarter.

We are encouraged by rising interest rates and a steepening yield curve. However, it will take time for our assets to reprice higher than current portfolio rates. In the near term, we expect continued NIM compression, as new pricing on loans continues to be lower than our portfolio rate, particularly in our mortgage portfolio. In addition, the available liquidity in the Hawaii banking market is resulting in aggressive market pricing on commercial loans, putting additional pressure on margins.

Turning to credit quality, provision for loan losses was $100,000 in the third quarter and $1 million year to date. In the third quarter, increases in reserves for loan growth and charge-offs were offset by the release of reserves associated with a specific commercial loan payoff and recoveries of previously charged-off loans.

Consistent with the improving credit quality trend, net charge-offs were $6,000 in the third quarter, down from $800,000 in the linked quarter and $3.2 million in the prior-year quarter. Similarly, third quarter 2013 net charge-offs ratio was especially low at nil compared to 8 basis points in the linked quarter and 35 basis points in the prior-year quarter. The allowance for loan losses was 1.01% of outstanding loans at quarter end, a decline from 1.04% from the linked quarter.

On Slide 15, American's nonperforming assets ratio of 1.33% was 23 basis points lower compared to the end of the second quarter, and lower than the 1.73% at the end of the third quarter last year. This is consistent with our improved credit quality and effective credit management and remains low compared to peers.

Slide 16 illustrates American's continued attractive asset and funding mix relative to our peer banks. In American's September 30, 2013, balance sheet backed against the last complete available data set for our peers, which is off of 2013 June, 96% of our loan portfolio was funded with low-cost deposits versus the aggregate of our peers at 92%.

In the third quarter, total deposits increased by $35 million to $4.3 billion. Other borrowings increased by $52 million, reflecting the five-year FHLB borrowing agreement to support our loan growth.

American remains well capitalized, with a leverage ratio of 9.3%; tangible common equity to total assets of 8.4%; and total risk-based capital ratio of 12.5%, all at September 30, 2013. In the third quarter American paid $10 million in dividends to HEI while maintaining solid capital levels.

With respect to regulatory developments impacting capital levels, the rules implementing the Basel III capital framework were finalized on July 3, 2013, and become effective on January 1, 2015. Management's analysis to date indicate that its current capital structure is more than adequate to satisfy the new capital rules.

Now back to HEI as I close. We continue to maintain a strong consolidated capital structure, with common equity to total capitalization of 51% as of September 30, 2013. S&P's review of HEI, Hawaiian Electric, and American, completed during September and October, resulted in no change in ratings or outlook for the Companies.

As for 2013 guidance, we are narrowing HEI's GAAP 2013 earnings guidance range to $1.55 to $1.62 from $1.52 to $1.62. At the utility, we are narrowing the range by $0.01 on both ends of the range, to $1.18 to $1.22 based upon our year-to-date performance and expectations for the fourth quarter.

Our original O&M guidance of flat to up to 1% assumed approximately $5 million pretax or $3 million after-tax lower customer service expense. We now expect 2013 O&M to be approximately 2% higher than last year.

Offsetting the increase in O&M is the third-quarter 2013 tax adjustment of $3 million. There are no other changes to our assumption for the utility.

At the Bank, we are increasing its 2013 EPS guidance range to $0.56 to $0.58 per share from $0.54 to $0.57. Our expectations for 2013 improved further based on the unusually low year-to-date provision for loan losses. Although the Bank provided for increased loan-loss reserves as a result of loan growth, provision benefited in 2013 from several factors, including the nonperforming commercial loan payoffs and the sale of the credit card portfolio, which resulted in the release of reserves.

We now expect provision to be $1 million to $3 million pretax for the year, a reduction of $4 million from our prior quarter's guidance of $5 million to $7 million pretax. This results in a $2 million after-tax benefit to 2013 earnings guidance.

While we expect loan growth to moderate, we expect to exceed our mid-single-digit target for this year. However, in conjunction with moderating loan growth and a higher interest rate environment, we expect continued decline in mortgage banking income.

HEI -- there are no changes to our assumptions, including the expectation for the approximately $75 million partial settlement from our equity forward by the end of this year.

Now I will turn the call back to Connie for a wrap-up.

Thanks, Jim. In summary, our utility continues to focus on reducing our customers' electricity bills in our high-bill environment and on providing excellent customer service, and we are currently ahead of the state's Renewable Portfolio Standards goals.

Our Bank continues to focus on stable performance through prudent loan growth and strong risk management.

Turning to our quarterly dividend, on Wednesday the Board maintained the dividend of $0.31 per share. Our dividend yield remains attractive, and as of yesterday's close, it was 4.6%.

We believe we are well positioned to continue to deliver a unique combination of stable earnings growth with an above-average dividend yield and relatively low risk in volatility through our unique combination of Companies. And with that, we look forward to hearing your questions.

(Operator Instructions). Charles Fishman, Morningstar.

Does the level of renewables on Maui -- does that meet the Commission's expectations now? I think you said it was 91%?

This is Dick Rosenblum. I think we are certainly making progress on meeting the Commission's expectations -- that's 91% of all the available energy is being accepted. The two areas where we have continue to have some challenges, and we continue to try to improve, are in the very early morning hours when the load is very, very low, and the percentage of renewables can be very high.

And surprisingly, in the midafternoon, when although the load is high, the production of rooftop photovoltaic is also very high. And when that combines with high winds, we have the same sort of situation where the available margin to utilize it is quite low. So we continue to work on those areas, but I think we are well on the way to meeting the expectations of the Commission.

So that is the measurement that the Commission is looking for, that percentage utilization?

Yes.

Okay. And then, if you could also maybe give some color on -- the O&M now is 2% increase over 2012, versus 1%, I think, last quarter. What is driving that?

Charles, this is Tayne Sekimura. What is driving that is our customer service expenses are higher than originally were forecasted.

Okay. I mean, just all around, the utility distribution is just higher. Nothing really specific? It is not really benefits or numbers?

No. This is Dick Rosenblum. It is not benefits or even distribution. It's really the specific of customer service expenses, particularly in our phone center, where we have been focusing on improving the level of responsiveness in our phone centers. And typically, you do that -- among other things -- by simply adding more reps so that you can answer the calls faster.

But I think your phone centers are fairly new.

That's primarily what's going on.

Your phone centers are fairly new, aren't they? So you are still probably going down the cost curve on those, aren't you?

Well, the phone centers have been around a while, but you are exactly correct in that they are operating on the new CIS system -- customer system. And as you would expect, it is taking them a little longer as they are learning a new system and getting used to it. And that is a portion of what is driving that cost up.

(Operator Instructions) Paul Patterson, Glenrock.

I wanted to go over the deferred income tax adjustment. That is non-recurring. Is that correct?

It is Jim, Paul. Yes, it is non-recurring. It is a reconciliation of deferred tax accounts that occurred over quite some many years.

Okay. The lower costs associated with these contracts that you are negotiating -- the 9 utility contracts -- why are they lower than the competitive bid process? Could you explain the differential between those two things, and why that's -- could you just elaborate a little bit more on that?

Sure. This is Dick Rosenblum. We have perceived for some time that the competitive bidding process we have been in is resulting in the bidders essentially bidding against our avoided cost of energy. And so in this round, we put a price target out of $0.17 a kilowatt hour and said we would not accept any bids above that.

We then went through several rounds of bidding and were able to produce a much lower price than we have been able to acquire through the traditional bidding process in the past.

Okay. So it's sort of a new thing that you guys are coming up with that should help you guys out going forward, I guess, in the cost side.

We certainly hope so, yes. We think that that's pretty much a new benchmark for what price is acceptable, and we continue to look for decreases in renewable energy prices from here.

Okay. And then on the RAM review, you guys made a filing, I think, a couple of weeks ago, indicating that you were somewhat concerned about the impact it could have on your credit quality, and I guess it's basically the financial impact on the Company. Could you elaborate a little bit more on -- or give us a little bit of flavor as to what you think -- I mean, this is just Schedule A issues, too, as I recall. I mean, I think you also mentioned similar concerns with Schedule B. But I just was wondering if you could describe some of the concerns that you guys are worried about.

Paul, this is Tayne. What we did a few weeks ago was we provided some input on some of the issues that the PUC might want to look at. And in doing so, we just added a view to include what the credit rating agency impact may be, for purposes of discussing issues in a more broader sense. But I wouldn't say it was a concern. It was more just providing more input in the types of issues that should be vetted in that proceeding.

Okay. I guess -- you know, we're looking at this, and we -- and with that case that we've discussed before, with their concern of about you being unduly insulated, perhaps -- have you guys had any discussions with the Commission, or any flavor as to whether their concerns are more -- or have been -- whether their concerns that they have expressed have been ameliorated to some degree?

This is Dick Rosenblum. I think that is a very good question. Let me try to answer it in a couple of pieces.

First and foremost, I want to point out that PUC has been very visible in stating their policy support for decoupling as a process and in our environment. So that is sort of the backdrop for everything I am going to say.

I also think it is important to note that none of the present Commissioners were seated when the existing decoupling was debated and implemented. So they sort of come to this with a fresh set of eyes, and I think they both want opportunity for input into the mechanism -- which, of course, they didn't get, because they weren't seated at the time.

And they perceive a need to make sure the mechanism remains relevant in light of current -- you know, somewhat changed circumstances. For instance, we have almost 20% renewables today. Back then, we had in the low single digits. We have explosive growth of rooftop PV today; that certainly was not the case back then.

We have much higher oil prices, and therefore customer bills, than we had back then. So it really is an attempt on their part, I think, to just take a fresh look at it, make sure it remains relevant. And I personally don't have any expectation that any particular changes are coming or currently are in their minds.

But I do understand they come at this with new eyes and view the mechanism in light of changed circumstances. So I think it is truly an attempt to really take a hard look at it in light of the environment we're in today.

Okay. With respect to the IRP process, I guess there was this independent evaluator who failed to certify it. What are the next steps that we should think about in terms of -- I don't know -- what does that mean, I guess? And what does it mean for the process going forward with respect to the IRP process?

This is Dick again. The next step is really for the Commission to consider both our IRP, and our input, and the independent observer's input, and make a decision as to whether they want any additional action taken going forward; they want it changed going forward; or they view it as a good effort, and meeting their needs, and there is no need to redo anything. So it's really in the Commission's hands to balance all the input.

Any timeline in terms of when we might get a Commission response to that?

Again, this is Dick. There is no established timeline.

Okay. And then just finally, to the Bank, loan loss reserves looked very good. And you guys mentioned overall credit trends led to that. Is that because of real estate prices? Could you just elaborate little bit more on that, and what your outlook for that might be going forward?

This is Rick Wacker. Thanks, Paul. Real estate prices have been moving up, and so certainly that is helpful in disposing of some of the REO. So we haven't had losses on additional REO disposals.

We have also been resolving a lot of the portfolios. We have been able to run off our land loan portfolio a little faster than we had forecasted, and so that has helped us. And we have resolved some of the larger commercial non-earnings that we had quite favorably. And so it has been a combination of a long process of working through the riskier parts of the book, help from the economy, and a bit of help from real estate prices, too.

(technical difficulty) going forward.

We think that, again, the revised guidance that Jim spoke to for this year says we should stay in a relatively favorable way through the end of the year. And next year we don't think we will have as much of the favorable effect of running off those riskier parts of the book.

We expect kind of the gross charge-off numbers to continue to come down, but some of the benefits that we had in recoveries of previous charge-offs or the provision reversals will probably not be as high as this year. And so you will see some increase from those levels.

Paul, I would just add that those are what have been offsetting the need to reserve for the loan growth that Rich has been experiencing.

Michael Goldenberg, Luminus.

I wanted to ask you a question. You mentioned something about CapEx decreasing $15 million in 2013. I didn't quite catch -- is that just being moved into 2014, and you are going to do $15 million more in 2014? Or is 2014 staying the same?

Michael, this is Tayne. I wanted to clarify that. We had mentioned -- Jim had mentioned on his comments that CapEx is decreasing in 2013 by $30 million.

I'm sorry. $30 million. Okay.

Yes, three zero. And the reason for that is we are taking a fresh look at what we spend in the generating area. You heard a little bit about our plan for deactivating some of our generating units; and in light of that, we are looking at what we pour into CapEx. So some of that is being moved off to future years. Others are being eliminated because of the deactivation that is going to be ahead of us.

And, Michael, I would just add that in Jim's comments, he also noted that we are expecting plant additions to be on target, and also to meet the rate base growth of about 5% for the year.

So if we look at the numbers, is 2014 changing at all, based on this $30 million reduction in 2013?

Michael, it is Jim. We will actually be reviewing our plans for 2014 as we close the year and advise you of any changes as we come forward on the next earnings call.

But as of now, you just -- the slide decreased 2013 by $30 million, and that was it? Or did you increase 2014 in the slide for that?

We haven't actually talked through 2014 or any other forward year plans as of yet, and it is under review right now.

Yes. But there is a slide with CapEx, right?

Correct. So we haven't changed that slide for the balance of 2013. And then as we get into 2014 and the years after that, we will update that, if any updates are required, in the next earnings call.

Okay. So the slide is exactly like it was previously, with that reflecting what you have verbally stated?

That's correct.

Yes. No updates to -- that is the one in the Appendix, on Slide 30. No updates to that. And as Tayne said in her verbal comment, some of the $30 million has gone away. Some of it is transferred. But we haven't broken that down for you.

Michael, this is Shelley. I just want to clarify. As we have talked about before, we update that CapEx forecast once a year, and our normal cycle is to do that in February. And through that normal cycle, we are going through a reevaluation of our five-year CapEx plan right now. So we are not really speaking to anything beyond 2013.

We have no further questions at this time. I would now like to turn the call back over to management for closing remarks. Please proceed.

Thank you, everyone, for joining us. We look forward to seeing you at EEI next week. Thanks so much. Bye.

This concludes today's conference. You may now disconnect. Have a great day.