Southern Company (the) · NYSE:SO
Southern Company (the) — Q2 2016 Earnings Presentation
20 slides from Southern Company (the)'s earnings presentation, Jul 27, 2016
Slide 1: Second Quarter 2016 Earnings Conference Call
Second Quarter 2016 Earnings Conference Call July 27, 2016
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements Certain information contained in this presentation is forward‐looking information based on current expectations and plans that involve risks and uncertainties. Forward‐looking information includes, among other things, statements concerning the exp
Slide 3: Major Accomplishments
Major Accomplishments *Subject to closing Vogtle 4 First Syngas 3
Slide 4: Kemper Project Update
Kemper Project Update • First syngas using Gasifier ‘B’ • Heavy level of activity in the coming days • Next milestone: initial syngas power production 4
Slide 5: Vogtle 3&4 Construction Update
Vogtle 3&4 Construction Update Recent Progress Near Term Unit 3 Unit 3 Set generator stator, deaerator, and • Set Containment Vessel Ring 2 first low pressure turbine lower casing Set all “Big 6” modules Unit 4 Set all four step-up transformers • Set CA20 module in the auxiliary building All fou
Slide 6: Unit 3
Unit 3 All “Big 6” Modules set CA03 CA02 CA20 CA05 CA01 *CA04 is located below CA01 and is not pictured 6
Slide 7: 2016 Earnings Results
2016 Earnings Results Q2 YTD 2015 2016 2015 2016 Earnings Per Share As Reported $0.69 $0.68 $1.25 $1.21 Impact of increase in Kemper cost estimate $0.02 $0.03 $0.02 $0.06 Acquisition costs - $0.03 - $0.05 MCAR Settlement costs - - $0.01 - Earnings Per Share x-items $0.71 $0.74 $1.28 $1.32 Acquisitio
Slide 8: Q2 2016 vs. Q2 2015 Adjusted EPS Drivers
Q2 2016 vs. Q2 2015 Adjusted EPS Drivers +4¢ -3¢ +5¢ -4¢ +13¢ -1¢ -1¢ +1¢ -4¢ -2¢ $0.77 $0.71 -2¢ Wholesale Non-fuel Depreciation Taxes AFUDC Interest Southern Parent & Other Shares Electric O&M & Amortization Other Expense Power (Excluding Operations Retail Sales Other Acquisition Revenue Financing
Slide 9: 2016 Earnings Per Share
2016 Earnings Per Share Q3 Estimate = $1.16 per share 2016 Guidance = $2.76 - $2.88* Excluding • Southern Company Gas and acquisition debt financing cost • Southern Company Gas, PowerSecure and SONAT acquisition costs • SONAT and related financing costs * 2016 guidance provided as of February 3, 201
Slide 10: Projected 2016 Capital Investments = $20.1B
Projected 2016 Capital Investments = $20.1B $ in billions February Updated Forecast Capex Forecast Jan-Jun Jul-Dec Total Alabama Power 1.3 0.7 0.6 1.3 Georgia Power 2.5 1.2 1.3 2.5 Gulf Power 0.2 0.1 0.1 0.2 Mississippi Power 0.8 0.3 0.5 0.8 Southern Power* 2.4 1.5 3.0 4.5 Southern Company Gas n/a 0
Slide 11: Southern Power CapEx Forecast
Southern Power CapEx Forecast Updated Forecast $4.5B Placeholders $0.5B • 2016 expected to be a “high-water” Wind mark for Southern Power capex $1.4B February Forecast • Pivoting towards wind $2.4B • Incremental capex primarily for wind projects or projects with in- service dates of 2017 and beyond
Slide 12: 2016 Financing Plan
2016 Financing Plan $12 billion of debt issued or drawn to date at an average coupon of 2.94% and average maturity of 12 years $9.0B $8.5B YTD financing activity thru June $8.0B Projected Sr. Debt $3.5B Projected DOE Loan Projected Jr. Subordinated Debt $3.0B Projected Common Equity $2.5B $300M $8.5
Slide 13: Appendix
s oN Southern Company Appendix
Slide 14: Generation Portfolio Diversity
Generation Portfolio Diversity Capacity Factors Q2 YTD 2015 2016 2015 2016 Coal - PRB 64% 58% 61% 54% Coal - Non-PRB 41% 33% 35% 29% Gas - Combined Cycle 65% 73% 69% 73% Energy Mix Q2 YTD 2015 2016 2015 2016 Natural Gas 44% 50% 46% 50% Coal 37% 30% 34% 27% Nuclear 15% 16% 16% 16% Hydro/Other 4% 4% 4
Slide 15: Southern Power Renewable Portfolio – Operational Assets
Southern Power Renewable Portfolio – Operational Assets Size SPC Ownership Original COD Asset Location Customer Technology (MW) (MW) PPA Term Date Cimarron 31 28 Colfax Co., NM 25 years Tri State Dec-2010 First Solar Thin Film (Fixed) Apex 20 18 N. Las Vegas, NV 25 years NVE Jul-2012 Trina Crystalli
Slide 16: Southern Power Renewable Portfolio – Projects Under Construction
Southern Power Renewable Portfolio – Projects Under Construction Size SPC Ownership Original COD Asset Location Customer Technology (MW) (MW) PPA Term Date Sandhills - Taylor Cobb, Flint, Irwin, Middle Georgia 147 147 Taylor Co., GA 25 years Q4-2016 First Solar Thin Film (FS Trackers) County (EMCs)
Slide 17: Southern Company and Subsidiary Ratings
Southern Company and Subsidiary Ratings Senior Unsecured (Moody’s/S&P/Fitch) Southern Company Baa2/BBB+/A- (S/N/S) Alabama Georgia Gulf Mississippi Southern Power Power Power Power Power Southern A1/A-/A+ A3/A-/A+ A2/A-/A Baa3/BBB+/BBB+ Baa1/BBB+/BBB+ Company Gas (S/N/S) (S/N/S) (S/N/S) (N/N/S) (S/N
Slide 18: Long-term Debt Maturity Schedule
Long-term Debt Maturity Schedule $ in millions - as of June 30, 2016 2016 YTD Remaining Total 2017 2018 2019 2020 5Y Total Alabama Power 200 - 200 561 - 200 250 1,211 Georgia Power 504 200 704 450 750 500 42 2,446 Gulf Power 125 110 235 85 - - 175 495 Mississippi Power 900 300 1,200 586 900 125 7 2,
Slide 19: Southern Company Liquidity and Credit
Southern Company Liquidity and Credit $ in millions - as of 6/30/2016 Post-acquisition of Southern Company Gas, Southern Company will have nearly $8.5 billion in committed credit facilities 2016 2017 2018 2019 2020 Total SO Consolidated Credit Facilities Expirations $ 353 $ 63 $ 1,665 $ - $ 4,400 $
Slide 20: Ss N
Ss 7 N Southern Company ——_—