8-K: TXNM Energy Reports 2025 Results Amid Blackstone Deal Progress

TXNM Energy announced its 2025 financial results, reporting a decline in GAAP and ongoing earnings per share, while providing updates on its proposed acquisition by Blackstone Infrastructure and ongoing regulatory initiatives.

Summary

• TXNM Energy reported 2025 GAAP earnings of $1.48 per diluted share, a decrease from $2.67 in 2024.
• Ongoing earnings per diluted share for 2025 were $2.33, down from $2.74 in 2024.
• GAAP net earnings attributable to TXNM Energy for 2025 were $151.4 million, compared to $242.2 million in 2024.
• Ongoing net earnings for 2025 were $238.9 million, a slight decrease from $247.8 million in 2024.
• The proposed acquisition by affiliates of Blackstone Infrastructure for $61.25 per share is progressing, with shareholder approval received on August 28, 2025.
• Regulatory approvals for the Blackstone transaction have been received from FERC, PUCT (unanimous settlement), FCC, and the Hart-Scott-Rodino Act waiting period has expired.
• Approvals are still being pursued from the Nuclear Regulatory Commission and New Mexico Public Regulation Commission, with closing anticipated in the second half of 2026.
• TNMP filed a general rate proceeding with the PUCT on November 14, 2025, requesting recovery of $2.8 billion of rate base and a 10.4% return on equity, with new rates expected in mid-2026.
• PNM filed an application with the NMPRC on December 29, 2025, for two economic development projects totaling an estimated $165.5 million.
• PNM also filed an application on February 25, 2026, for a new 345 kV transmission line and related infrastructure at an estimated cost of $247 million to enhance reliability and integrate renewable energy.
• PNM initiated its 2026 Integrated Resource Plan (IRP) process in Q4 2025, covering 2026-2046, with a filing expected by September 1, 2026.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this filing as neutral to slightly positive. While financial results show a decline in earnings, largely due to non-recurring items, the significant progress on the Blackstone acquisition and ongoing strategic investments in clean energy and infrastructure provide a positive long-term outlook.

Positives

• The proposed transaction with Blackstone Infrastructure is progressing, having received key regulatory approvals from FERC, PUCT, FCC, and HSR clearance.
• TNMP supported a 28% increase in system peak demand in 2025, indicating strong growth in its service area.
• PNM delivered 80% carbon-free energy in 2025, demonstrating progress towards clean energy goals.
• PNM is investing significantly in infrastructure with a $247 million transmission line project aimed at enhancing reliability, integrating renewables, and supporting economic development.
• TNMP's second DCRF filing for 2025 was approved and implemented in the fourth quarter, providing recovery for $19 million of rate base.

Negatives

• GAAP diluted EPS decreased significantly to $1.48 in 2025 from $2.67 in 2024.
• Ongoing diluted EPS also declined to $2.33 in 2025 from $2.74 in 2024.
• GAAP net earnings attributable to TXNM Energy fell to $151.4 million in 2025 from $242.2 million in 2024.
• Ongoing net earnings decreased to $238.9 million in 2025 from $247.8 million in 2024.
• GAAP earnings in 2025 included $3.4 million of net unrealized losses on investment securities, a reversal from $2.7 million in gains in 2024.
• A $58.8 million pension settlement charge related to a previously disposed gas distribution business impacted 2025 GAAP earnings.
• Merger-related costs of $43.1 million were incurred in 2025, impacting GAAP earnings.

Risks

• The expected timing and likelihood of completion of the pending transaction with Blackstone Infrastructure, including the timing, receipt, and terms of required governmental and regulatory approvals.
• The possibility that required governmental and regulatory approvals could reduce anticipated benefits or cause the parties to abandon the transaction.
• The occurrence of any event, change, or other circumstances that could give rise to the termination of the transaction agreement, potentially requiring TXNM Energy to pay a termination fee.
• The risk that the parties may not be able to satisfy the conditions to the proposed transaction in a timely manner or at all.
• The outcome of legal proceedings that may be instituted against TXNM Energy, its directors, and others related to the proposed transaction.
• Risks related to disruption of management time from ongoing business operations due to the proposed transaction.
• The risk that the proposed transaction and its announcement could have an adverse effect on TXNM Energy's ability to retain and hire key personnel and maintain relationships with its customers and suppliers, and on its operating results and businesses generally.
• The amount of costs, fees, charges, or expenses resulting from the proposed transaction.
• The risk that the price of TXNM Energy's common stock may fluctuate during the pendency of the proposed transaction and may decline significantly if the proposed transaction is not completed.
• Other unpredictable or unknown factors not discussed in this communication could also have material adverse effects on forward-looking statements.

Future Outlook

TXNM Energy anticipates the closing of the acquisition by Blackstone Infrastructure in the second half of 2026, subject to remaining regulatory approvals. TNMP expects new rates from its general rate proceeding to become effective in mid-2026. PNM plans to file its 2026 Integrated Resource Plan with the NMPRC on or before September 1, 2026, covering the 20-year planning period from 2026 through 2046. The company does not plan to issue 2026 earnings guidance during the pendency of the proposed transaction.

Management Comments

• "PNM and TNMP continue to grow and we remain focused on meeting our customer needs across New Mexico and Texas, with TNMP supporting a 28% increase in system peak demand and PNM delivering 80% carbon free energy in 2025."
• "Our proposed transaction with Blackstone Infrastructure will provide the necessary capital to support this growth and New Mexico's transition to clean energy."
• "We look forward to bringing the benefits of this transaction to our customers and communities."

Industry Context

StockSavvy.ai notes that TXNM Energy's focus on infrastructure investment, particularly in transmission lines and economic development projects, aligns with broader utility industry trends emphasizing grid modernization, reliability, and the integration of renewable energy sources. The company's achievement of 80% carbon-free energy for PNM in 2025 positions it favorably within the accelerating clean energy transition. The proposed acquisition by Blackstone Infrastructure highlights the increasing private equity interest in stable, regulated utility assets, especially those with significant capital expenditure needs for energy transition and growth.

Comparison to Industry Standards

• TNMP's 28% increase in system peak demand suggests robust regional economic growth, potentially outperforming some mature utility markets.
• PNM's 80% carbon-free energy delivery in 2025 places it among leading utilities in decarbonization efforts, exceeding the national average for renewable energy penetration in the U.S. electric sector, which was approximately 21% in 2022 according to EIA data. This compares favorably to peers like Xcel Energy, which aims for 80% carbon reduction by 2030, or NextEra Energy, a leader in renewable generation.
• The requested 10.4% return on equity for TNMP's rate case is within the typical range for regulated utilities, often falling between 9% and 11% depending on jurisdiction and market conditions, comparable to recent approvals for utilities like CenterPoint Energy or Evergy.

Stakeholder Impact

• Shareholders: Will receive $61.25 per share upon completion of the Blackstone acquisition, but face uncertainty until all regulatory approvals are secured. Current earnings decline may impact short-term sentiment.
• Customers: May experience rate increases if TNMP's general rate proceeding is approved, but also benefit from enhanced reliability and clean energy integration through new infrastructure projects.
• Employees: Potential for disruption or changes related to the Blackstone acquisition, though management aims to retain key personnel.
• Regulators: Actively involved in reviewing the Blackstone acquisition, TNMP's rate case, and PNM's infrastructure and economic development project applications.

Next Steps

• Continue pursuing regulatory approvals from the Nuclear Regulatory Commission and New Mexico Public Regulation Commission for the Blackstone acquisition.
• Work towards the anticipated closing of the Blackstone acquisition in the second half of 2026.
• Await PUCT approval for TNMP's general rate proceeding, with new rates expected to become effective in mid-2026.
• Continue the 2026 Integrated Resource Plan (IRP) process, including receiving public input.
• File the 2026 IRP with the NMPRC on or before September 1, 2026.

Key Dates

Recommendation

The stock is currently in a holding pattern due to the pending acquisition by Blackstone Infrastructure. While 2025 earnings declined, much of this was due to one-time merger-related costs and pension charges. The ongoing earnings, though also down, reflect continued operational stability and strategic investments in growth and clean energy. The primary driver for the stock price will be the successful completion of the acquisition at the agreed-upon $61.25 per share, making it a 'hold' until the regulatory process concludes. The downside risk is if the deal falls through, which could lead to a significant price decline.

Keywords

Utility, Energy, Blackstone Acquisition, SEC Filing, Earnings Report, Regulatory Approvals, Clean Energy, Transmission Line, Rate Case, New Mexico, Texas