Duke Energy Corporation (Holding Company) · NYSE:DUK

Duke Energy Corporation (Holding Company) — EEI International Utility Conference 2008

20 slides from Duke Energy Corporation (Holding Company)'s conference presentation, Mar 10, 2008

  1. Slide 1: EEI International Utility Conference

    March 10, 2008 EEI INTERNATIONAL UTILITY CONFERENCE Jim Rogers Chairman, President and Chief Executive Officer

  2. Slide 2: Safe Harbor Statement

    SAFE HARBOR STATEMENT Some of the statements in this document concerning future company performance will be forward-looking within the meanings of the securities laws. Actual results may materially differ from those discussed in these forward-looking statements, and you should refer to the additiona

  3. Slide 3: Investment Highlights

    INVESTMENT HIGHLIGHTS ƒ One of the leading power infrastructure companies in the U.S. ƒ Low-risk business profile ƒ Vast majority of ongoing segment EBIT is derived from regulated customers ƒ Strong earnings growth and total return ƒ 5% to 7% CAGR in ongoing diluted EPS through 2012 ƒ Annual dividen

  4. Slide 4: Low-Risk Business Profile

    LOW-RISK BUSINESS PROFILE U.S. Franchised Commercial Duke Energy Crescent Electric and Gas Power International Resources 2007 EBIT: $2,305 MM 2007 EBIT: $278 MM 2007 EBIT: $388 MM 2007 EBIT: $38 MM 2008E EBIT: $2,420 MM 2008E EBIT: $385 MM 2008E EBIT: $380 MM 2008E EBIT: $75 MM Regulated generation,

  5. Slide 5: Overview of U.S. Franchised Electric & Gas

    OVERVIEW OF U.S. FRANCHISED ELECTRIC & GAS ƒ 5 States: North Carolina, South Carolina, Indiana, Ohio and Kentucky ƒ 47,000 square mile service territory ƒ 28,000 net MW of generating capacity ƒ ~5,000 MWs of nuclear ƒ ~14,000 MWs of coal ƒ ~6,000 MWs of gas / oil ƒ ~3,000 MWs of hydro ƒ 3.9 million

  6. Slide 6: Ongoing Earnings Growth

    ONGOING EARNINGS GROWTH ƒ 2008 employee incentive target of $1.27 per share ƒ Based on ongoing diluted EPS ƒ 5 - 7% CAGR in ongoing diluted EPS through 2012 ƒ Earnings growth from: ƒ Capital re-investment ƒ Execution of regulatory initiatives ƒ Growth in our non-regulated businesses ƒ Continued focu

  7. Slide 7: Dividend – Steady and Growing

    DIVIDEND – STEADY AND GROWING ƒ 2007 represents the 81st year that Duke has paid quarterly cash dividends ƒ Current annual dividend per share of $0.88 ƒ $0.22 per quarter ƒ Current financial projections expect to grow annually ƒ Each increase requires separate approval from Board of Directors 7

  8. Slide 8: 2008 Ongoing EBIT Expectations

    2008 ONGOING EBIT EXPECTATIONS ($ millions) U.S. Franchised Electric & Gas $ 2,420 Commercial Power 385 Duke Energy International 380 Crescent Resources1 75 Total Ongoing Segment EBIT $ 3,260 Other (Net Expense) (265) Total Ongoing Segment EBIT and Other $ 2,995 EARNINGS PER SHARE EMPLOYEE INCENTIVE

  9. Slide 9: Capital Expenditures

    CAPITAL EXPENDITURES Capital Expenditures ($MM) 2008(1) 2009 2010 2011 2012 U.S. Franchised Electric & Gas System Growth $ 1,725 $ 1,950 $ 2,075 $ 1,875 $ 975 Environmental 475 225 125 100 100 Nuclear Fuel 250 200 275 475 450 Maintenance and Other 1,450 1,575 1,650 1,700 1,450 Total U.S. Franchised

  10. Slide 10: Re-Investment Supports Earnings Growth

    RE-INVESTMENT SUPPORTS EARNINGS GROWTH ($ in billions) ~60% Increase in 2008–2012 Rate Base U.S. Franchised Electric & Gas Rate Base Approximate current rate base $ 17 Less: Depreciation & amortization (9) $19 $2 Capital expenditures 19 OH/KY $27 IN $4 $(9) Estimated 2012 rate base $ 27 $11 Current

  11. Slide 11: 2008 Cash Flows

    2008 CASH FLOWS ($ millions) Primary Sources $7,000 $6,500 Net income(1) $ 1,600 Depreciation & amortization 1,800 $6,000 Total Sources $ 3,400 $5,000 Primary Uses $3,400 Capital and investment expenditures $ (5,100) $4,000 $ MM Dividends (1,150) Other sources/(uses), net (250) $3,100 $3,000 Total U

  12. Slide 12: Expected Rate Actions by State

    EXPECTED RATE ACTIONS BY STATE ƒ The frequency of rate cases over the next five years will be substantially higher than in prior years to align with our capital intensive business strategy ƒ Taking measures to minimize rate impact and maintain price competitiveness (modest and gradual price increase

  13. Slide 13: Key Activity

    KEY ACTIVITY Major Generation Projects Name Description ƒCliffside 800MW coal-fired generation in North Carolina ƒEdwardsport 630MW IGCC generation in Indiana ƒBuck and Dan River Two 620MW gas-fired plants in North Carolina ƒLee Nuclear ~2,200MW nuclear generation in South Carolina Major Legislative

  14. Slide 14: Resolving Regulatory Uncertainty

    RESOLVING REGULATORY UNCERTAINTY Activity Comments Status N.C. energy legislation ƒ Passed S.C. energy legislation ƒ Passed N.C. rate case ƒ Settled Ohio RSP ƒ Remand order received IGCC ƒ Received CPCN and air permit Cliffside ƒ Received CPCN and air permit Ohio energy legislation ƒ Working to achi

  15. Slide 15: Duke Energy Corporation Target Financial Metrics

    DUKE ENERGY CORPORATION TARGET FINANCIAL METRICS ƒ Expect to maintain solid, investment-grade credit metrics ƒ Debt / capitalization ratio projected to be in the mid-40% range by 2012 ƒ Allows rate base growth with modest equity issuance – approximately $200 million per year beginning 2010 ƒ S&P Bus

  16. Slide 16: Value Proposition

    VALUE PROPOSITION ƒ Proactive regulatory strategy Annual Total Return Profile ƒ 5% to 7% CAGR in ongoing diluted 15% EPS through 2012 ƒ Annual dividend growth ƒ No anticipated equity offerings 10% through 2012 excluding internal plans (e.g., dividend reinvestment plan “DRIP”) 5% ƒ Strong balance she

  17. Slide 17: Duke Energy – March 2008

    « wy) s £2 4 ee cZ it) = UE: 4 Pi ae LU fy: LTP ; DUKE ENERGY - MARCH 2008

  18. Slide 18: Non-GAAP Reconciliations

    Duke Energy Corporation Non-GAAP Reconciliations March 2008 EEI International Utility Conference Ongoing Segment EBIT for 2007 and Forecasted Ongoing Segment EBIT for 2008 The materials for Duke Energy’s March 2008 EEI International Utility Conference presentation include a discussion of ongoing seg

  19. Slide 19: Cash Flow Reconciliation Required by SEC Regulation G

    Duke Energy Corporation March 2008 EEI International Utility Conference Cash Flow Reconciliation Required by SEC Regulation G ($ in Millions) Forecast 2008 Primary Sources: Net income (1) a $ 1,600 Depreciation & amortization a 1,800 Total Sources 3,400 Primary Uses: Capital and Investment Expenditu

  20. Slide 20: Ongoing to Reported Earnings Reconciliation

    DUKE ENERGY CORPORATION ONGOING TO REPORTED EARNINGS RECONCILIATION December 2007 Year-to-Date (Dollars in millions, except per-share amounts) Special Items (Note 1) Costs to Convertible Achieve, Settlement Ongoing Debt Costs, Cinergy IT Severance Reserves and Discontinued Total Reported Earnings Ga

Duke Energy — EEI International Utility Conference 2008 on 6ix