Hannon Armstrong Sustainable Infrastructure Capital (HASI) 19 Feb 212020 Q4 Earnings call transcript

Good afternoon, and welcome to Hannon Armstrong's Conference Call on its fourth quarter and full year 2020 financial results. Leadership will be utilizing a slide presentation for this call, which is available now for download on the company's Investor Relations page at investors.hannonarmstrong.com. Today's call is being recorded and we have allocated 30 minutes for prepared remarks and Q&A. [Operator Instructions]. At this time, I would like to turn the conference call over to Chad Reed, Vice President, Investor Relations and ESG for the company.

operator. you, Thank and everyone, Good welcome. afternoon, on Earlier this detailing copy a available release Armstrong fourth Hannon of quarter is a distributed our results, and press XXXX afternoon, full website. our which year of is being will on Relations a This conference our later webcast where today. call website, available the live Investor page be replay

this meaning comments of uncertainties forward-looking I course the company's of the the of Securities Risk begins, from harbor in with call those described remind forward-looking company protections of statements the sections. contained described The Factors XXXX the and in the Actual to section within and XX-K like materially statements for to as claims XXA the Exchange as you safe XXXX, may Section the the risks call made are are SEC. of in that call Act of results Before XXE subject call. amended. made the would and Act The some the filings Securities and the other of of Section in the Form amended, this such and forward-looking of during statements differ

available in earnings to to presentation. financial considered GAAP GAAP. intended A be measures reconciliation today, information all with on not posted accordance based or any are statements release isolation as addition, financial as the discussed call. Please presentation in A a note forward-looking non-GAAP made expectations. undertake financial our revised In slide does will company of information this this for on non-GAAP not responsibility is of presented measures any forward-looking update be circumstances or and to and statements new certain that substitute the conference is on of

over Lipson, call today's call COO. CFO and to Jeff, Jeff on Slide that, our are company's who on Jeff? and X. turn begin me I'd Jeff the like to will and With the CEO; Chairman Eckel, Joining

are grew over of we exceeding annual earnings, everyone. core and X% $X.XX increase We closed compound the you, the portfolio to known as and $XXX in Chad, in total providing And X% to record, afternoon, distributable reporting earnings end XX% previously finally, distributable XXXX, transactions growth billion a XXXX, that million We $X.X rate, $X.X X-year almost of high guidance an billion. including in Thank guidance. our of annual previous year-over-year XX% Today, good our QX. XX% earnings. growth we're X-year XXXX compound share, per of

Page discuss and X turn detail. Let's and guidance to in dividend more

of I of trajectory are and per the a distributable XXXX guiding, strength through earnings per XX% X% growth we share. our portfolio $X.XX Given existing the a XXXX in the baseline share of to pipeline, as earnings said, relative to to

share. may of expect at end per you our If within XXXX is equivalent To to chart, the be be at look midpoint the to the in earnings, of guidance be yearly $X.XX clear, lumpiness there range. a this but we XXXX

growing accelerated basis. a a the to faster dividend 'XX. With to retain on total than to accretive X% capital earnings growth, from the and X% earnings XXXX intend dividend, for remain attractive we continue expectation rate at distributable grow return Given can our investments we annually to for of

share also in dividend X% of announcing our to first per we're today a So quarter increase $X.XX the XXXX. for

themes our like address investors mind that to the Now analysts. are would some turning and We of for top X. Slide macro to of key

a year for changing mount. climate of record. warmest XXXX on evidence First, to tied continues the

affected also example We're through may grateful extreme concerned cause, in assets power and last and hope possible. people disaster. and globe generally climate causing natural this are year, In of addition, the is in assets despite of $XXX partners The there the have commitment disasters Texas regardless events. outages be we for Clean the for soon massive of across resulting operating very billion. proven losses approximately resilient, But Texas change-induced portfolio well XXX their deep competence freeze pandemic our the economic recession. weather were an in power solar the performed managing for wind our XXXX, our as and has energy in restored as in and

duration, assets long of portfolio Our has noncyclical, expected. performed as climate-positive

events. it structures While are solutions continues and market of The events does is to grow mitigate net this portfolio, the as to the diversity our Texas our pipeline. we fully impact too preferred our early impacts understand confident the of on week's climate

have of flexible Our deep to our relationships opportunities with volume capital a attractive clients, solutions, led with combined returns. at permanent investment clean large greater infrastructure energy and risk-adjusted

demand the and proven equities ESG growing, of leaders. the for strong institutional addition, driven mandates performance is by ESG In investor

We reporting a is disclosure make. continue ESG all that companies to material believe should

support washing. metrics the also efforts global standardized social prevent We to and for performance green

their of market As advantages be performance. competitive that ESG more we investing and matures, leaders that ESG this will the believe will in apparent reflected become

policy several acting a industry rather our a federal the for in our is time than as for first Finally, tailwind and headwind years, business.

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a on for. carbon long a there is by price plan way advocated momentum dividend we have believe also of We carbon for

pipeline XX-month to from which notable of update is on Turning increased in quarter $X.X quarter billion. are prior from $X the from to pipeline, provide up greater we the our that we converted closings $XXX last X, we an It reporting even than as Slide pipeline QX. million billion, that we is almost

return the ESPC the the behind our industrial as and Administration. the our grow meter to to of sectors. in we remains as achieved and the do Biden opportunities one virtually markets program energy relationships. see toward aerodynamic by during to weighted through President efficiency XX drive programmatic approximately We pipeline every of invest. transactions expect continue strong end the growth bulk to to We striving levels is in financing clients possible the The make government federal Obama We where help

increasing solar behind-the-meter between of storage solar and addition, solar the wind, which number strong, include The onshore solar grid-connected well-balanced an land. and including portion residential, In pipeline similarly a grid-connected C&I remains is projects, component. community

wind, storage Lastly, our infrastructure to resilience + interesting see in in alongside X the pipeline. and Slide we preferred continue storage sustainable portfolio we the programmatic we potential geographic on also solar ambitious at portfolio focused deal partner with gigawatt diversity. contracted Clearway, onshore projects. and for the counter On and parties, of highly a detail X, significant year reflected contract predominantly represents last a investment investment-grade of flow closed transaction life grid-connected provides solar The U.S. market. as continued XX-year climate X The opportunities Clearway Energy million first grid-connected enjoys equity solar $XXX portfolio end plus average generation, weighted the a large our

the with weighted projects. solar co-op consumer, is a Stanley more storage sponsor XX With ENGIE years, average million and the As as a life we of larger an had Co-investors contract funded of the $XXX anticipate distributed equity highly of we X, XX than next and Morgan off-takers. overview and XX projects creditworthy On preferred of C&I commitment, this Slide few million remaining our portfolio behind-the-meter last of year, balance of funding operation in tax we investment megawatt rural include the equity. commercial portfolio years. over provide as as + end the achieve electric equity $XX

reach We projects this combines the financing of of also With forward highlight to we the completion equity year balance $XX or tax structure and the the unique flow as commitment funded over next of which funding date, projects. so. a million transaction, anticipate milestones

$X.X investments also that least these number we metric we've annual our year is Slide expect headline close Turning not in billion highlight closed we billion quarterly going evaluating forward. performance and most useful to What said to is close last and perhaps transactions. X. each of transaction year, Historically, transactions at $X our the for announced

as nearly metrics headline funded million NII portfolio and be commitments. flow would $XXX suggest useful periods growth in number future will However, that more December We growth for forward XX, tracking performance. will our funding be of perhaps under of that

the transactions may but useful. foreseeable think disclose additional closed still these will We future, prove for metrics

Now financial over performance it discuss Jeff I'll portfolio L., to turn our to and results.

the Welcome, Thanks, call. everyone, Jeff. to

balance and it year-end XX, portfolio compare to XXXX. we Slide our XXXX sheet to Turning at year-end detail

to investments. average and million. We've incremental First, the grown approximately from billion growth by $X.X XX the XX%, which this It's with over billion in last $XX approximately stands maintaining significantly $X.X larger. of portfolio achieved meaningful our is X.X% change size, at investment added we've yield while as year portfolio no

ever. our added we've and new XX% portfolio than comprises asset grid-connected solar. of the diversity than class more is No asset stronger Secondly, portfolio, a class

and and very quality believe XX pleased of as we've extended our and its resilience. portfolio of average is our diversity strong portfolio is We performance longer-dated key our years. a life the consistently with remain driver Finally, even this to weighted

expectations As performance XX, we our of assets our high-quality in Slide throughout the within seniority turn obligors. to and credit XXXX. the our perform continued quality structural by This is part our of investments have driven to

are meaningful operating our price asset our of senior This of structure to obligors the investments, both obligor or credit creditworthy investments, senior impact nearly attributes investment-grade in detailing seniority, very our reducing government entities typically has in and addition, our commodity notably position. corporate structural The a associated consumers. a or seniority our of a And In each risk. in most quarter we've structural exposure preferred or classes. and added table we with super our all are

Slide to XX. Moving

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has use conditions, clarified distributable which primary their measure, REITs, subject elected earnings as the distributable performance measure. our may most non-GAAP recently provisions, earnings have we excludes a SEC non-GAAP and use that to primary to certain as However, CECL

results. X% also that increased income increase partially higher Higher cash and to by to XXXX. year. XX% was sale an portfolio interest maintained low-yielding and we despite was outsized the it, the balance evaluating remains we For net X simplicity, our quarters economic of performance both the XXXX. of defined team Summarizing earnings metric in equivalent the of to we in distributable as that we our earnings, our please have XXXX, useful our from an distributable compared in and is $X.XX XXXX. the to our of pre-CECL expense. think revenue of $XX note earnings the on that recorded used during distributable We million larger the in earnings and I'll $X.XX leadership both much in share gain investment indicator our as core year-over-year increase offset calibrating believe per investors fact This dividend. performance Fundamentally, only best first distributable

we In XXXX, sale institutional addition, in recorded our remains gain access as private to debt income significant on strong.

from cash return on to also method continued both continued as and return was capital despite To portfolio. model strong in equity of XXXX, results recession. conclude, pandemic and dual investments robust our generate in to on Our the revenue collected XXXX the we receive

our Slide we yield guidance on managed years, and XX% good equity multiyear XX% XX, return one lumpy, a is growth X reasons continuing be that on As of XX%. $X.X this the reminder disclosed at the achieved and for a We previously while turn to we why chart assets can closed target; above averaged the X-year billion is last above portfolio the rates to a volumes transactions bottom appropriate is in have generate above NII. right our our which we or reflect although over business. think steady the

in of after the a XX% equity. resulting $X.X our Moving increase unsecured quarter, bonds, In billion XXXX. portfolio. of at as to investments, capital Slide year-end of balance detail funded in XXXX, level compared to our as Slide elevated green our million of equity, X/XX. organic fundings In result continued scheduled fundings green million fourth Even the $XXX $XXX we coupon XX, We $XXX income in nearly cash on convertible million in net we this in growth for and highlight have $XXX investment $XXX in million these we anticipate in will bonds portfolio debt we the growth XX, balance X nearly including On and significant the markets. access sheet million investment, sheet year-end in we to in raised XXXX. and further

to of Following financials, refresh at-the-market registration we equity $XXX to up intend year-end the our filing our million. issuance

provide additional We by last are adding this million We announce of to will the week credit facility excited flexibility. future the sustainability-linked a unsecured $XX which also closing facility in further relationship funding banks, with revolving anticipate just JPMorgan. expanding

So other during a of enhanced capital. flexibly prolonged and pandemic access and capital sources recession, ability our to the we actually markets

prudent and asset rate over of our with to that, continue take platform I'll risk summary, earnings, and leverage XXXX to In favorable the we market levels. quality, our our turn addition, to funding poised we remain interest we With including Jeff. at pleased In maturity were manage performance, profile and back advantage call conditions.

Thanks.

The to Foundation. capitalize efforts I Turning carbon achieved updates XXXX. also history, XX, in ESG foundation in the change we to S of provide in the reflected with a highlight effort we're newly With driven and almost efficiency intersection we on use pleased the for a the to Xx which was This a Slide our XXXX, of reduce provide we in greater dividend reduction initiatives. volumes, E, for more to Hannon to strategic our million by part long-term of will our formed social in X.XX declare justice. climate to ESG, our future higher transaction to carbon, Armstrong than $X focus capital highest our carbon in but social find elevated philanthropic calls. by to count this earnings regard the With regard hope year. the

Finally, our to grows, as company our it's diversity. grow to governance, competencies of number, with in Directors regard important and Board

leadership to we offer previously and employees compelling why welcome seen board Smith Armbrister, are have pleased on a announced vision. realignment, investing University; Slide X I our the platforms press proposition members new ago. capital clients, well of value I'm want to We'll believe best our With first Johnson may one founder investors venture Nancy deliver board serve XX of Floyd, on we positioned our you and Clay in members; climate-positive to As we energy to President years and to XX. release, clean yesterday's of summarize our investors. C. new conclude

drives to public platform a durable pipeline confidence a carbon proven array And X high-quality we and a and infrastructure for structure leverage been along and energy tested is record of ESG a with quantitative growing by portfolio and that's nearly and our projects prudent companies investors. stable by quite a to a funding years, our backed Programmatic With Our developed approach reporting transparent and have performed company sources provides and by robust that Growth clean leading well. of the track dividend. as XXXX, in capital diversified backed

as group. S&P the we've about sum reasons, REIT ESG YieldCo confident these the accomplishments last outperformed For ability like Hannon XXX close to ahead. in as for years and their thanking open the over and months XXXX, the the and XXXX well significantly years. indices of the for Index front of a X the To in us outstanding I opportunities thrilled staff on efforts them And and to up, in in we're execute truly our please by would remarkable Operator, in questions. Armstrong line

Instructions]. [Operator

Strouse today Mark Our with first comes JPMorgan. question from

to early you too impact about what's what I Texas. Two of risk, go kind questions do happening that in of picture, curious portfolio your high-level to I on think industry. a lot hearing just thoughts. then of for And happening, you're different mean, what's Texas? good bigger who's for the spokesperson debate a for that there. you of said potential know guess? framing mean, your I it's is blame How exposure I about I to the kind your Jeff, going in know

Mark. Thanks,

impact. I too know said, it's early the As to net

have plants grateful that conditions. partners. a others effort; some with as them. restarted not. to job daily getting our would rates truly They difficult have in real-time this high and are generators got a them You've doing very are clients, We're phenomenal the very power is calls say at are I that and selling we

the and third not we've the investments in really it script, mentioned Texas the from the is impacts think the preference features in piece, I that our mitigate just meaningful. events,

the light to the we very issuing material. kind that even of the being we possible we and not I conservative are that can everything best issues even think we with And seen where are a estimate make X-year goes that week. statement we, worst-case of is good just, us, evidence have of found bad guidance this in So what about impacts we've Texas. we of is strongest It's folks, is assumes well. goes nothing feel ERCOT the the And we impact

certainly perplexed Clean always On to issues, their been getting will Island, done be Power a I've the a the to having out Association in hoping by there. American Solutions 'XXs. Power ERCOT I'm desire It's utility. way run true story remain the Island the tough

energy. is, saying big aspiration not comment, that in people that's the think of I I XXX% get Mark, been but systems a never how I've clean utility thing, work. would say the that fan I other

this, need reinforces mix a You I it. think, of generation; just and

So should obviously and is to real a there going people lot fingers not of a pointing disaster long This for a time. for just are be it happen.

your stop why I So see that, don't I've with if question. and answered

Yes. Yes, helpful. that very was

Just more does Jeff to the than ratio it dividend, for for The higher earnings payout follow-up guidance one the down. points growth obviously L. for so coming

given proven I for the markets, even give with into a during XXXX, capital color Just the bit payout just you your I kind ratio? being bit can more a ability conservative mean access rationale more to your, mean, of

Mark. Sure,

for have I pipeline strong time and been way a to message to long faster guidance So a This a grow more way, think than just And the time. a it's at saying that we least years. when expect quantitative retain capital prudent have to more such for good we and pipeline just run more business a EPS we've a for previewing in DPS. that think very of been will couple some reinforces new we've consistently that

retaining think And just we and a But confident growth some capital and you're do not capital markets high remain recycle as makes sense. balance there's our we in accelerated DPS, capital right, platform. it So EPS. putting that an forth we are and there, quite in as just re-access could

with comes Partners. Capital question next ROTH Shen Philip Our from

with growth touch a on you and the could implied NII. originations Jeff, if might I know of wondering in to guys be portfolio talked about think, But X-year you overall focus what for are shift And originations a base wanted in share embedded you maybe was bit guidance. originations. I that important. having I the outlook said, still, to the

$X.X at the more billion if lines of you're could we Or billion? be think than thinking example, you along higher year, $X.X this should $X.X billion? do the XXXX, So a for be

Thanks, Phil.

we're do X still you are said I -- billion number. you originations averaged over We've think a think That's important; so bad $X.X we. not years.

I hit think to don't proven do we to certainly can billion. we our not need we've $X.X We're numbers. guidance that do --

So in originate stability $X.X And could. the the But and the this that that's of tension lower always is of long-term to think for more we're the business. business I you mean, running I order the equity something there's billion, can on ultimately, billion return between return? take on $X you And a yes, answer range. and

question, hopefully that answers your Phil. So

yes. does, It

add bit. And I answer that could to little Phil, if a

our and number, billion funds. that a difference Just it from a keep said component between Jeff say, includes big it in and which year let's in in or away as billion, only mind, of this to half $X.X flow future at in implied reinforce a and $X.X there's movement perhaps slight funds least originating all comments comments, originating, his

it, that's as bit. and a so not reason is And a as have been standalone the little using as we're meaningful number deemphasizing why it number that think we why quite people just that's

which $XXX look haven't your that's think $X.X billion, Jeff. to funded I makes billion, point, at we million, And $X.X if but still you the

over standpoint. on helpful. very modeling a to from that's Yes, gain Great. Shifting sale

on the there kind takes mid-teens-type You a millions? you level. have forward? do and should we consistent mid-teens be lot factors. this lots and But the in been coming Is term, that this of expect I counting going market know in in in depends are puts pretty to of quarters, near remain it something the of of guys on kind

business, quarter some bit you sales. we It's including and gain as tough much. zero, lumpiest to at less We quarters, quarter the had very of little And say. successful start some have every That the on is know. a fourth the pretty part of

But I think we think want on as of did that relates it I So in to $XX expect don't will be an total, a million some number. sale XXXX, I view you the to that's we consistent gain outsized a at should number lumpiness. going bit as promise forward.

be in I expect likewise, you type to our bullish to continue to should it a we asset demand though, to of that and material are several continue that securitization as strong have that outlook partners well And for express for classes lend active think themselves there remain securitization. investment. do

So material, it'll be continue to lumpy. but

I challenging one, has the of And you commentary, Okay. robust through past of, One Texas on guys have if in XX, kind year. asset that, a nice issuing really On depiction well-performing challenges in may. Slide Jeff, base your you're still then spite last your this how of been guidance. X-year

And that's you'll it well. that, portfolio arguably like and yet so shock sounds with to likely another your perform

be investment-grade the rating, So us think be could credit would for signal the your on if that just I as rating you the and that this might can't perspective, through fantastic. potential talk through potential us the what they year? But from agencies, an you update I exactly. of your can know potential for situation

that a The credit, a wouldn't in scale, difficult characterize We've attribute achieving we'll conversation or favor. this is something reasonably it achieved of also JPMorgan have I would handicap, a particularly rating for look positive is business new to. certainly with agencies. only our this which, work And the It's likely. think the is again, recession in Phil. which terms unsecured agencies I facility, more more say I will year. or in to well detail likely unlikely in it's performing

case, likelihood. So of hesitate in I to good would a have we it I handicap but think terms

from Kaye come question with next our Noah Oppenheimer. And will

XX-month time $X increased the first the in billion. a has to while, For pipeline

this past traditional announced a yet question. by given inflating has structurally Would out a funded? just investments unusually Or feel pipeline? or pipeline? So that call is that larger been number the have by, anticipate could Does a $X.X you in include you've this year's inflated like the inflated billion you we that future, do the as what in that be versus is to

of approximately First $X than more that $XXX in QX. than that subtracts more $X.X million went billion, to we $X we billion on than billion all, from more and the closed

double question. aspect will said that's we slide, as of count, never if third is your on No, an think, we So growing. the pipeline think, and solutions we growing, I climate investing our is the,

news out is So that a this fundamental there. just there's more good business

pipeline opportunities Your is just in structurally expanded because climate? investment of the

Yes.

Great. Yes.

I to curve XX% think the into yield going finally good debt have fixed-rate steepening, time that.

today. been to, remind do you relative How I a deal certainly say, in where past? business positioned for of has impact could steepening investors think yield impacting increases can were equities the you're flow? interest you spreads, terms But potential you of now how in rate think your curve

So of liabilities, extended, particularly the recent we've I think duration our most deal. with the XX-year

the the I a the was shorter than business, would duration you of liabilities duration say think of a this time you'd was and at bit look assets. the there

steepening curve help. some would doing in the risk So yield have token, we'd that. By same

ways, risk, that's in think taken I yield out the benefit steepening of also, some curve. a that we've some but of reduced

So I big for the benefit have think a don't it'll business.

debt that drives spreads. impact movement the of indicative second-tier ultimately it's curve a a curve more profitability, some indicative and not our itself. it's I differential that our investments it's credit in of spread credit a is yield think think strong the yield steepening I economy, usually And between usually

storage. resiliency site little come see types to increased seeing that past, the renewables of kind of plus paramount Texas events for it's the In towards this on Because what been impacts opportunities to given distributed the of localization, a think of certainly, of we're is funding week. pipeline? I the whether to you sense. and potential in spur this Obviously or in do I some bit has at industry grid a But to different resiliency, PG&E of Sandy energy too energy, those on early the Superstorm increased power bend tending plus Makes been wildfires, on the tell. want Yes. arc week's resiliency, way. investments

we energy Particularly see reliable need don't been decentralized for a resources. and to That's a going as the grid that's distributed, electrify, time. we a couldn't. I No, continues how U.S. long much more more it on need trend

But behind-the-meter Our service. happening. is event hard in solutions, a yes, it'd see expand the it And should this is pipeline just a energy not it because is for different part dominated to to Texas, me by of in why be quality wouldn't power distributed resources. hideous shift be

question with next from comes Our BTIG. Lewis Greg

down that is grow little this you pipeline? guess follow up growing is understand, quietly meter, any California year, just the there and helping basis but what's meter kind percentage on out earlier it at the want In I is Clearly, I Is way to a battery the kind an of up. there last from mentioned basis as that it Is expanding. knowing question. kind pipeline to accelerating? behind event, just looking of that Noah's a pipeline went went of a the storage the behind bit, on of absolute

Sunrun C&I of necessarily the increasingly storage. But the in anybody wouldn't or say storage part or to I or listen if Nova markets, is you solution. SunPower

up. valuable. more just think to it our that's hard-pressed that much But is why be solar say we'd pipeline I makes

sort throw Like And it clearly, Great. a then about we yields, Okay. as Grid-connected, thinking it's meter. the is, about, putting just attractive about the behind lower think think set; little is is the bit need opportunity growing. with yield, to in than into to as which eye on be invest grid-connected it as as to in going be the maximizing of portfolio? just attractive portfolio it -- some of we an not the we

probably partnership feel global said, are business. like us, highly certainly competitive bit when structure We are opportunity for with more and than auction. somebody there we've possible. large little more that And common positions quite a very No, that should win an a that's investors, a else not always great of equity and institutional that's

we So as our see of good for the clients. for chasing needing capital they and risk-adjusted capital. by lot case us, Whether I grid-connected case. of have take a investments, those best certainly that's thing lot a There's a return

with question next comes B. Souther Our Riley. Chris from

you on in to think in to where piggyback being could sale. think how about it's but should -- out, baked just around question that predict, in targets touch shorter gain the much growth as of part term not impacts, tougher the you're the we giving there? How on Maybe necessarily we should the on the X-year that about

we I next that's did year; think we're fundings NII obvious. to going grow quarter, I fourth clearly, fairly the Well, given the think in

contributor our terms to logically should growth you be targets. material not terms part a we're In should growing XX%, on to But that are earnings of to to sale, and expect very going remain disclose of specific to that's our what it a active to earlier the going of be earnings to gain business. said conclude in going you continue the X% I

though, gain for sale true, to that business. would on a to wanted And sale to always to be well earnings want I more always that. that better seem position sale episodic. the be incrementally add better higher in from to noise I've NII a on It's We position to on drive just reliable I can just gain I a be to think marginally do true. to XXXX that And be we've relative more because positioned to upside. gain said be we're for

hear. to a of great that's No, lot That makes sense.

or do should the that about not to talk that at to to this So end kind looking something on Or targets you thinking about to able provide sheet broad high maybe? you'd of you've today, you'd want growth be the we side, point? be low that given strokes of get balance the the is other at think

disclose you think portfolio. that probably yield. guiding when you to about I flat growth a triangulate on again, bit targets towards the We're But think, are a that we not relatively going can specifically

we're where year. see mentioned to per roughly on to billion Jeff earnings. of can $X.X guiding new billion You $X investments

I think there's growth numbers us that for an without to what look like, specifically. triangulate ability portfolio with will put we've out disclosing the you

helpful. operating And one Okay. Got maybe the it. on just That's expenses. the last

this going think be year we should how then throughout the about Just and trend helpful? would forward there

down, with up increasing think you a this I I should the should as in is our you metric. that growth. percent more a about we fairly operating to materially staffing increase important significant basis, envision coming think keep because But on think percentage which expenses actually are of revenue, increases

will we're a despite at basis growing significant on a faster growing than we be think clip. expenses, I growing percentage revenues expenses somewhat

with Ben Kallo question Baird. comes next Our from

X Jeff. Hey, ask going to I'm questions. Jeff and

The first business a fundamental. is

about The is second technology.

bigger picture. Third's

asset financials. business So we got The ROE, down. going so costs capital fundamentals, your yield steady, are

You got in your leverage model.

forward? So question. How going we think should that the forward? That's go first where ROE my should about

You trajectory in think to upward steady a should ROE. about

you again, that them the impact I most are steady, ROE; are some some think, out improving. of variables laid of

to suddenly ROE but think it's XX% increases expect don't a ROE. business, see some I be I steady we'll in So

And the drives changes is sale. on thing to to that really ROE going going in around produce And is on really changes period ROE steadier well, any the gain of thing that noise ROE was amount be one going -- a is the say, Ben, NII and is in I sale. the the to gain

Okay.

are bigger your what third what Jeff, a fuel my On Jeff you that? question. guys, cells, do then the views on technology picture one is Jeff, part, and

wished one I'd at of chance. a that. got I bought always kind we lens Plug a I I that by first. to I missed Power when carbon say look from mile. had a things Well, Then

the of it progress out the in We hydrogen think outstanding. carbon fuel count amount would I cells figure fundamentally what is. is on the

of technology they're now. viable almost XX years proving this seems think quite I trying, after to be,

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Dumoulin-Smith with from Our next Bank Julien comes of question America.

guidance. this on Congrats

a but me how little Let would leave to you be describe try it things. I'd curious open-ended,

when view, billion look a here, $X differently of asked what that what's portfolio? $X.X when So Maybe whether what billion where like, more then or the we to Philip. really, that And composition But little you of this mix portfolio that that from size X-year it's And you you're aspiring separately, get this, have? about does bit think critically? per your year, to? what's do the net yield kind think you does with importantly, right, there, look like mix what regards

only over-concentrated have we than mix, worried going we a few have We in portfolio the class. tilt And or those don't for want only was other have not will worry We're Well, residential years everyone people any here now any in solar. residential certainly that wind. have too any portfolio unbalance ago don't we'll to ways. goal be And to to we much one specific onshore solar. perhaps asset don't were going

one diversity. of for whether business all think of sorts look asset both sector not, advantages our in I returns of the is classes, also the power getting or Julien, to incremental model, at but great the ability

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broadly And Excellent. I'm then here. bit it. Got little a more thinking

about over perhaps you as of and investments versus think more in renewable in to about the don't investments think status, it right curious that right? the to you not future we REIT that set trajectory some REIT time matter the relative As you not I'm historical renewables this the do does or about just and opportunity sustainable directly qualify. direct how how portfolio otherwise, guys relative of you that maybe see the renewables now think how have into do you specifically may And the is you made? evolve, the and bother status balance with invest if trajectory

L.? Good question. Jeff

Jeff to slightly some guidance. paths to Julien, which multiple have we just said, achieving some So extent, this in to I use words, is, reiterate, say, different would, what answering that,

We have more your on of and share in in amount also in take the $X paths or corporate then portfolio, the gain terms terms us of question, many, XXXX many of of the yield, in will in status. per which different to terms sale, to terms of

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just thing. one And Yes. to correct

the securitization said sheet. on balance you think assets I

off think the sheet. you say balance I meant to

Yes.

material point. the test is to there flexibility at yes, there But REIT as remains still it relates this

to many way without specifics, too best I getting So the that's into it. I think think characterize

valued are Julien, level. at And And balance for assets off sheet equity remember, the valued bad the the net REIT gross. at are repurposes assets

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heard hear right question in I you you. it? Super do not want did you I Texas? for there. you to Yes, Or Jeff, miss quick. sure don't impact you, that on I you just one quantifying if make mind. Did I last Mesquite

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Byrd next question Stephen comes with Stanley. from Morgan Our

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conclude today's as session question-and-answer presentation. conference Thank will as you This call. for attending today's well our

may disconnect. You now