Company: SOJE
Filing Date: 2025-02-20
Form Type: 10-K
Source: 0000092122-25-000018
Chunk: 2443

Company: SOUTHERN CO
Filing Date: 2025-02-20
Form: 10-K
Item: Item 3
Chunk 2443
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II-14

    Table of Contents                                Index to Financial Statements        COMBINED MANAGEMENT'S DISCUSSION AND ANALYSIS

Interest Expense, Net of Amounts Capitalized

Interest expense, net of amounts capitalized increased $31 million, or 10.0%, in 2024 as compared to 2023. The increase reflects approximately $17 million related to higher average outstanding borrowings and $14 million related to higher interest rates. See FINANCIAL CONDITION AND LIQUIDITY – "Sources of Capital" and "Financing Activities" herein and Note 8 to the financial statements for additional information.

Income Taxes

Income taxes increased $47 million, or 22.3%, in 2024 as compared to 2023. The increase was primarily due to higher pre-tax earnings. See Note 10 to the financial statements for additional information.

Other Business Activities

Southern Company's other business activities primarily include the parent company (which does not allocate operating expenses to business units); PowerSecure, which provides distributed energy and resilience solutions and deploys microgrids for commercial, industrial, governmental, and utility customers; Southern Holdings, which invests in various projects; and Southern Linc, which provides digital wireless communications for use by the Southern Company system and also markets these services to the public and provides fiber optics services within the Southeast.

A condensed statement of operations for Southern Company's other business activities follows:

2024Increase (Decrease) from 2023(in millions)Operating revenues$665 $111 Cost of other sales411 56 Other operations and maintenance213 38 Depreciation and amortization71 (6)Taxes other than income taxes4 — Total operating expenses699 88 Operating income (loss)(34)23 Earnings (loss) from equity method investments(16)(21)Interest expense1,030 167 Other income (expense), net(24)(8)Income taxes (benefit)(292)6 Net loss$(812)$(179)

Operating Revenues

Operating revenues for these other business activities increased $111 million, or 20.0%, in 2024 as compared to 2023 primarily due to an increase of $120 million at PowerSecure primarily related to distributed infrastructure projects, partially offset by a decrease of $18 million at Southern Linc primarily related to equipment sales associated with commercial customers.

Cost of Other Sales

Cost of other sales for these other business activities increased $56 million, or