Txnm Energy, Inc. · NYSE:TXNM
Txnm Energy — PNM Resources — Q1 2019 Earnings Presentation
23 slides from Txnm Energy's earnings presentation, May 7, 2019
Slide 1: Q1 2019 Earnings Review
Q1 2019 Earnings Review May 7, 2019
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements made in this presentation for PNM Resources, Inc. (“PNMR”), Public Service Company of New Mexico (“PNM”), or Texas‐New Mexico Power Company (“TNMP”) (collectively, the “Company”) that relate to future events or expectations, projections, estimates, intentions, goals,
Slide 3: Opening Remarks and Overview
Opening Remarks and Overview Pat Vincent-Collawn Chairman, President and CEO
Slide 4: Financial Results and Key Highlights
Financial Results and Key Highlights Financial Results Q1 2019 Q1 2018 GAAP EPS $0.23 $0.19 Ongoing EPS $0.13 $0.21 • Upper end of earnings guidance increased to $2.20 • Revised 2019 Ongoing EPS Guidance $2.10 - $2.20 Key Highlights • New Mexico Legislative Updates • Energy Transition Act: Securitiz
Slide 5: PNM and TNMP Regulatory Agenda
PNM and TNMP Regulatory Agenda Filing Action Timing Docket No. PNM Appeal of 2015 General Rate Case to New Mexico Oral arguments held October 30, 2017 No statutory timeline S-1-SC-36115 Supreme Court Parties’ responses filed with New Mexico NMPRC order issued to file application in support Supreme C
Slide 6: Financial Overview
Financial Overview Chuck Eldred Executive Vice President and CFO
Slide 7: Q1 2019 Ongoing EPS Financial Summary
Q1 2019 Ongoing EPS Financial Summary $0.02 ($0.07) $0.21 PNM ($0.03) TNMP $0.13 Corporate Q1 2018 Q1 2019 7 Note: Segment drivers included in appendix
Slide 8: Load and Economic Conditions
Load and Economic Conditions Regulated Retail Energy Sales and Customers (weather-normalized) Q1 2019 2019 • Residential and commercial sectors are PNM vs. Guidance Q1 2018 expected to be in line with annual guidance PNM Residential & Commercial 0.6% 0.3% - 0.5% • Revised guidance resulting from str
Slide 9: Consolidated Earnings Guidance (Ongoing)
Consolidated Earnings Guidance (Ongoing) 2019 Earnings Guidance (Revised) $2.10 Consolidated EPS $2.20 PNM TNMP Corp/Other $1.63 – $1.70 $0.67 – $0.69 ($0.20) – ($0.19) 2019 Previous Revised Consolidated EPS $2.10 - $2.18 $2.10 - $2.20 PNM $1.61 - $1.65 $1.63 - $1.70 TNMP $0.67 - $0.69 $0.67 - $0.69
Slide 10: 2019 - 2022 Investment Plan
2019 – 2022 Investment Plan $2.6B investment plan achieves targeted earnings growth Growth opportunities realized in the plan: • $285M(1) Western Spirit acquisition included as PNM transmission expansion in 2021 • $40M of additional PNM T&D capital added in 2022 San Juan Replacement Power $804 Addit
Slide 11: 2019 - 2022 Potential Earnings Power
2019 - 2022 Potential Earnings Power Earnings Growth Target: 5 - 6% 2019 Ongoing Earnings 2020 Earnings 2021 Earnings 2022 Earnings Allowed Guidance Midpoint Potential Potential Potential Return / Equity Ratio Avg Rate Avg Rate Avg Rate Avg Rate Return EPS EPS EPS EPS Base Base Base Base PNM Retail
Slide 12: Questions and Answers
Questions and Answers
Slide 13: Appendix
Appendix
Slide 14: Q1 2019 vs Q1 2018 EPS (Ongoing): PNM
Q1 2019 vs Q1 2018 EPS (Ongoing): PNM PNM $0.14 Q1 2019 Key Performance Drivers ∆ EPS $0.12 Weather $0.03 Interest expense savings $0.03 Retail rate phase-in, including changes in tax rates and retail $0.02 generation portfolio changes approved in BART settlement Retail load $0.01 Outage costs $0.01
Slide 15: Q1 2019 vs Q1 2018 EPS (Ongoing): TNMP and Corporate
Q1 2019 vs Q1 2018 EPS (Ongoing): TNMP and Corporate TNMP Q1 2019 Key Performance Drivers ∆ EPS $0.12 Rate relief, including TCOS ($0.04) $0.05 Depreciation and property tax ($0.02) Weather ($0.01) Q1 2018 Q1 2019 Corporate Q1 2019 Key Performance Drivers ∆ EPS ($0.03) ($0.06) Interest expense ($0.0
Slide 16: Potential Earnings Power
Potential Earnings Power 2019 Ongoing Earnings 2020 Earnings 2021 Earnings 2022 Earnings Allowed Guidance Midpoint Potential Potential Potential Return / Equity Ratio Avg Rate Return EPS Avg Rate EPS Avg Rate EPS Avg Rate EPS Base Base Base Base PNM Retail(1) 9.575% / 50% $2.4 B 9.5% $1.44 $2.4 B $1
Slide 17: EBITDA and Quarterly Earnings Distribution Guidance (Ongoing)
EBITDA and Quarterly Earnings Distribution Guidance (Ongoing) Ongoing EBITDA (In millions) 2019E Midpoint Consolidated PNM Resources $572 PNM $378 TNMP $173 2019 Quarterly Ongoing Earnings Distribution 56% 27% 6% 11% Q1 Q2 Q3 Q4 17
Slide 18: Weather Impact
Weather Impact PNM Q1 2019 Q1 2018 2019 Normal(1) Heating Degree Days 1,224 989 1,102 Cooling Degree Days 1 0 0 Net EPS Impact $0.02 ($0.01) compared to normal TNMP Q1 2019 Q1 2018 2019 Normal(1) Heating Degree Days 927 877 902 Cooling Degree Days 75 150 88 Net EPS Impact $0.00 $0.00 compared to nor
Slide 19: PNM Scheduled Plant Outages
PNM Scheduled Plant Outages San Juan Four Corners Palo Verde Duration Time Duration Time Duration Time Unit Unit Unit in Days Period in Days Period in Days Period 4 44 Q2 2019 Q1 2019 1 30 Q2 2019 4 21 (completed) 3 44 Q4 2019 Q1 2019 5 21 (completed) 19
Slide 20: Balance Sheet and Credit Metrics
Balance Sheet and Credit Metrics
Slide 21: Liquidity as of May 3, 2019
Liquidity as of May 3, 2019 PNMR PNMR PNM Develop- Corporate Resources PNM TNMP ment /Other Consolidated Financing Capacity(1): (In millions) Revolving credit facilities $440.0 $75.0 $25.0 $300.0 $840.0 As of 5/3/19: Short-term debt and LOC balances $2.5 $29.3 $15.1 $60.6 $107.5 Remaining availabili
Slide 22: Selected Balance Sheet Information
Selected Balance Sheet Information (In millions) Dec 31, 2018 Mar 31, 2019 Long-Term Debt (incl. current portion) (1) PNM $1,656.5 $1,706.9 (3) TNMP 575.4 798.9 Corporate/Other 438.2 438.4 Consolidated $2,670.1 $2,944.2 Total Debt (incl. short-term) (1,2) PNM $1,698.9 $1,706.9 (3) TNMP 592.9 798.9 C
Slide 23: Credit Ratings
Credit Ratings PNMR Consolidated S&P Moody’s Issuer rating BBB+ Baa3 Outlook Negative Stable Senior unsecured rating BBB Baa3 PNM S&P Moody’s Issuer rating BBB+ Baa2 Outlook Negative Stable Senior unsecured rating BBB+ Baa2 TNMP S&P Moody’s Issuer rating BBB+ A3 Issuer outlook Negative Stable Senior