What's their growth strategy?

Algonquin Power & Utilities Corp is a utility company beaten down in recent years but ready for change.

After a two-year strategic review, AQN decided to focus specifically on being a "pure-play regulated utility."

As a pure-play regulated utility, AQN will focus specifically on providing electricity, natural gas, and water services to customers moving forward. The company currently generates most revenue through its 1.3 million utility connections - water, natural gas, and electricity - for customers across the United States, Canada, Bermuda, and Chile.

To achieve this goal, Algonquin enacted a three-step plan, helping to restructure, pay down debt, and focus on their strengths:

Step 1) Selling Renewable Energy Business: First, AQN sold their renewable energy business (which lost $78.9 million in 2024) for $2.5 billion.

Step 2) Capitalize on Stake in Atlantica Sustainable Infrastructure: AQN had a 42.2% stake in Atlantica, and they sold that stake to a private investment fund.

Step 3) Growing & Strengthening the Regulated Utility Business: This is AQN's next goal. To do this, they plan to:

• "Optimize our regulated business activities"

• "Strengthen our balance sheet"

• "Enhance our quality of earnings"

Specifically, the company plans to reduce costs and increase revenue via the following:

• 5 to 7% reduction in operating expenses by 2027

• Petition utilities and regulators (like Apple Valley Water in California and Empire Electric in Missouri) for rate hikes

• Investing in grid modernization and customer-centric infrastructure without going into more debt (say, by using operational cash flow and the $2.5 billion from the renewables sale)

The market seems to be reacting well to these changes: AQN is up around 23% YTD.