Ameren Corporation · NYSE:AEE
Ameren — Q3 2020 Earnings Presentation
29 slides from Ameren's earnings presentation, Nov 5, 2020
Slide 1: Customers at the Center
Customers at the Center Third Quarter 2020 Earnings Nov. 5, 2020
Slide 2: Cautionary Statements
Cautionary Statements Forward-looking Statements Statements in this presentation not based on historical facts are considered "forward-looking" and, accordingly, involve risks and uncertainties that could cause actual results to differ materially from those discussed. Although such forward-looking s
Slide 3: Business Update
Business Update Warner Baxter Chairman, President and Chief Executive Officer, Ameren Corp.
Slide 4: Earnings and Guidance Summary
Earnings and Guidance Summary • 2020 diluted EPS guidance range of $3.40 to $3.55, narrowed from our prior guidance range of $3.40 to Diluted EPS $3.60 2019 vs. 2020 • Key Q3 earnings variance drivers $2.97 $3.04 ↑ Earnings on increased infrastructure investments across all $1.47 $1.47 business segm
Slide 5: Executing Our Strategy
Executing Our Strategy Our Strategic Plan • Investing in and operating our utilities in a manner consistent with existing regulatory frameworks Capital Expenditures YTD Sep. 2019 vs. YTD Sep. 2020 • Enhancing regulatory frameworks and advocating for responsible energy and economic policies ($ millio
Slide 6: Regulatory and Legislative Initiatives
Regulatory and Legislative Initiatives Enhancing regulatory frameworks and advocating for responsible energy and economic policies Ameren Illinois Electric Distribution • Continue to engage with key stakeholders and support Illinois legislation to extend electric performance-based ratemaking and mod
Slide 7: Ameren Missouri Generation Transformation
Ameren Missouri Generation Transformation Transition to a cleaner and more diverse portfolio in a responsible fashion 1 50% CARBON EMISSIONS 85% CARBON EMISSIONS NET-ZERO CARBON REDUCTION2 REDUCTION2 EMISSIONS2 • Ameren Missouri filed its preferred Integrated Resource Plan with the MoPSC in Sep. 202
Slide 8: Renewable Energy Investments
Renewable Energy Investments Creating and capitalizing on opportunities for investment for the benefit of our customers, shareholders and the environment • Build-transfer agreements for 700 MW of wind generation in Missouri, ~$1.2 billion investment, to comply with Missouri’s RES – Construction of f
Slide 9: Robust Investment Opportunities Across All Businesses Over Next Decade
Robust Investment Opportunities Across All Businesses Over Next Decade Modernizing the grid and investing in cleaner generation for the long-term benefit of customers, shareholders and the environment Investment Plan 2020-20241 Additional Investment Opportunities 2020-2029 $39B+ ($ billions) Strong
Slide 10: Our Sustainability Value Proposition
Our Sustainability Value Proposition ENVIRONMENTAL SOCIAL GOVERNANCE • Accelerating transition to a cleaner and • Delivering value to our customers while • Diverse BOD focused on strong oversight more diverse portfolio focused on safety-first work culture – 55% women or people of color – Target carb
Slide 11: Long-Term Total Return Outlook
Long-Term Total Return Outlook • Remain on track to deliver strong long-term earnings growth 2019 to 2024E Regulated Five-Year Rate – Expect 6% to 8% EPS CAGR from 2020-20241 Infrastructure Rate Base1,2 Base CAGR1 • Using 2020 original EPS guidance range midpoint of $3.50 as a base ($ billions) – Ex
Slide 12: Financial Update
Financial Update Michael Moehn Executive Vice President and Chief Financial Officer, Ameren Corp.
Slide 13: 2020 Third Quarter Earnings Analysis
2020 Third Quarter Earnings Analysis Key Earnings Variance Drivers ↑ Ameren Transmission earnings Diluted EPS — Increased infrastructure investments Q3 2019 vs. Q3 2020 ↑ Ameren Illinois Natural Gas earnings — Increased infrastructure investments $1.47 $1.47 ↑ Ameren Illinois Electric Distribution e
Slide 14: 2020 EPS Guidance and Select Balance of the Year Considerations
2020 EPS Guidance and Select Balance of the Year Considerations • Expect 2020 diluted EPS guidance range of $3.40 to $3.55 • Select considerations for Q4 2020 EPS compared to Q4 2019 EPS 2020E – Ameren Missouri expected lower sales driven by COVID-19: ~$(0.01) Diluted EPS Ameren Missouri Weather-Nor
Slide 15: Select Regulatory Matters – Ameren Illinois
Select Regulatory Matters – Ameren Illinois Electric Distribution • Requesting $45 million base rate decrease from ICC in annual update – In Sep. 2020, ICC Staff recommended $49 million base rate decrease – Expect ICC decision by Dec. 2020, with new rates expected to be effective in Jan. 2021 – If a
Slide 16: 2020 Financing Update
Ameren Credit Ratings 2020 Financing Update and External Debt Balances1 Debt Financing • On Mar. 20, Ameren Missouri issued $465 million of 2.95% first As of Sep. 30, 2020 $ in millions Moody's S&P mortgage bonds due 2030 – Proceeds used to repay short-term debt, including short-term debt Ameren Cor
Slide 17: Select 2021 Earnings Considerations Compared to 2020
Select 2021 Earnings Considerations Compared to 2020 ↑ 700 MW wind generation investment of ~$1.2 billion expected to be substantially in-service by end of 2020 ↑ New electric service rates effective Apr. 1, 2020 Ameren ↑ Higher weather-normalized electric retail sales reflecting gradual improvement
Slide 18: Summary
Summary Expect to deliver strong earnings growth in 2020 with guidance in a range of $3.40 to $3.55 per diluted share Successfully executing our strategy; well-positioned for future growth Strong long-term growth outlook • Expect 6% to 8% compound annual EPS growth from 2020-20241,2 • Expect ~8.7% c
Slide 19: Appendix
APPENDIX
Slide 20: Four Constructive Regulatory Frameworks
Four Constructive Regulatory Frameworks FERC-regulated: Formula ratemaking Ameren • Allowed ROE is 10.52%, includes MISO participation adder of 50 basis points; ~54% average equity ratio Transmission • Rates reset each Jan. 1 based on forward-looking calculation with annual reconciliation ICC-regula
Slide 21: Regulatory Mechanisms that Address COVID-19 Uncertainties
Regulatory Mechanisms that Address COVID-19 Uncertainties % 2019 Regulated Sales Bad Debt Pension2 EPS1 • ~97% of margins related to electric • No tracker or rider • Pension and OPEB tracker in • No electric revenue decoupling • AAO requests filed with MoPSC on electric business • Electric margins a
Slide 22: 2020 Earnings Analysis for Nine Months Ended Sep. 30
2020 Earnings Analysis for Nine Months Ended Sep. 30 Key Earnings Variance Drivers ↑ Ameren Transmission earnings — Increased infrastructure investments Diluted EPS — Impact of FERC order addressing MISO allowed base ROE: +$0.04 YTD Sep. 2019 vs. YTD Sep. 2020 ↑ Ameren Illinois Natural Gas earnings
Slide 23: Regulatory and Legislative Initiatives
Regulatory and Legislative Initiatives Enhancing regulatory frameworks and advocating for responsible energy and economic policies Ameren Illinois Electric Distribution • Downstate Clean Energy Affordability Act1 (HB 5673/SB 3977) introduced in Feb. 2020 – Allows utility-owned solar and battery stor
Slide 24: Regulatory and Legislative Initiatives, Cont’d
Regulatory and Legislative Initiatives, Cont’d Enhancing regulatory frameworks and advocating for responsible energy and economic policies Ameren Transmission • In May 2020, FERC issued order on rehearing of its Nov. 2019 order related to first and second MISO base ROE complaint cases – Established
Slide 25: Investing in the Energy Grid
Investing in the Energy Grid Creating and capitalizing on opportunities for investment for the benefit of our customers, shareholders and the environment • Investing to modernize energy grid – Provide a more safe, reliable, resilient and secure energy grid – Enable two-way energy flows to accommodat
Slide 26: Building a Brighter and Cleaner Energy Future
Building a Brighter and Cleaner Energy Future Innovative Programs to Meet Customer Needs and Rising Expectations Utility-owned solar Subscription program generation facilities for MO available to MO residential non-residential customer Neighborhood Community and small business parking lots, open lan
Slide 27: Our Focus on Delivering a Cleaner Energy Future Responsibly
Our Focus on Delivering a Cleaner Energy Future Responsibly • Climate risk management and mitigation – Targeting significant reductions in greenhouse gases Target to Achieve Net-Zero – Implementing robust customer energy efficiency programs Carbon Emissions by 2050 – Investing to modernize the energ
Slide 28: Investor Relations Calendar
Investor Relations Calendar NOVEMBER 2020 JANUARY 2021 SUN. MON. TUES. WED. THUR. FRI. SAT. SUN. MON. TUES. WED. THUR. FRI. SAT. 1 2 3 4 5 6 7 1 2 Q3 Quiet Q3 2020 Period, Earnings Cont’d Call 8 9 10 11 12 13 14 3 4 5 6 7 8 9 EEI EEI EEI Virtual Virtual Virtual Conf. Conf. Conf. 15 16 17 18 19 20 21
Slide 29: Select Regulatory Matters
Select Regulatory Matters Missouri Public Service Commission • 2020 Integrated Resource Plan: Docket No. ER-2021-0021; https://www.ameren.com/netzero • Order approving electric rate review settlement: Docket No. ER-2019-0335 • Smart Energy Plan filing: Docket No. EO-2019-0044 • Order approving reque