Nextera Energy, Inc. · NYSE:NEE
Nextera Energy — Barclays CEO Energy-Power Conference 2016
38 slides from Nextera Energy's conference presentation, Sep 7, 2016
Slide 1: Barclays CEO Energy-Power Conference
Barclays CEO Energy-Power Conference John Ketchum Executive VP and CFO, NextEra Energy September 7, 2016
Slide 2: Cautionary Statements And Risk Factors That May Affect Future Results
Cautionary Statements And Risk Factors That May Affect Future Results This presentation includes forward-looking statements within the meaning of the federal securities laws. Actual results could differ materially from such forward- looking statements. The factors that could cause actual results to
Slide 3: NEE and NEP each achieved solid financial results in the first half of 2016
NEE and NEP each achieved solid financial results in the first half of 2016, driven primarily by new investments First Half 2016 Performance Review • NextEra Energy achieved year-over-year growth of ~11% in both adjusted earnings per share and cash flow from operations • At FPL, we continue to inves
Slide 4: NEE's adjusted EPS and cash flow from operations were up ~11% year-over-year
NEE’s adjusted EPS and cash flow from operations were up ~11% year-over-year through the first six months of 2016 NextEra Energy Results – First Half 2016 Adjusted Earnings Adjusted EPS ($ MM) $1,510 $3.26 $1,328 $2.95 2015 2016 2015 2016 As discussed on our second quarter earnings call, more of our
Slide 5: Our core focus at FPL has been consistent for many years
Our core focus at FPL has been consistent for many years FPL Areas of Focus • Unyielding commitment to Superior Customer Value Delivery customer value proposition • Focus on efficiency and Strong Financial Virtuous Circle Customer best-in-class cost Position Satisfaction performance Constructive • O
Slide 6: We have a number of opportunities ahead of us
We have a number of opportunities ahead of us FPL Overview of Opportunities • We are laser focused on the underpinnings of our successful strategy: – Efficiently deploying incremental capital and focusing on O&M savings – Investments that benefit both investors and customers – Continue to enhance th
Slide 7: FPL submitted its formal base rate filing on March 15th
FPL submitted its formal base rate filing on March 15th Estimated FPL Rate Case Timeline March 15, July/ August/ January 2016 June August September Q4 2017 File formal Quality Intervenor, Technical Final New rate request of staff, and hearings decision rates (testimony; service FPL by PSC effective
Slide 8: Energy Resources' renewables development opportunities have never been stronger
Energy Resources’ renewables development opportunities have never been stronger Drivers for Renewables • Certainty of U.S. Federal Tax incentives for renewables • Improvements in wind and solar technology and declining cost trends • State regulatory programs to encourage development of renewable ene
Slide 9: U.S. Federal tax incentives for completed renewables projects have been extended
U.S. Federal tax incentives for completed renewables projects have been extended into the next decade Extended U.S Federal Tax Credits Wind Production Solar Investment Tax Credit (PTC) Tax Credit (ITC) Start of Start of Construction COD Wind Construction Solar Date Deadline PTC Date ITC(1) During 20
Slide 10: Energy Resources' renewables development program is well positioned for continued success
Energy Resources’ renewables development program is well positioned for continued success Energy Resources Development Program(1) • 2015 – 2016 renewables development program of over 4 GW – ~1.5 GW brought into service in 2015; ~2.5 GW on track for 2016 delivery(2) • Increased expectations for our 2
Slide 11: NextEra Energy makes it the premier YieldCo sponsor in the sector
We believe the strength of NextEra Energy makes it the premier YieldCo sponsor in the sector NextEra Energy: Partnership with NEP NEE • Characteristics of a premier sponsor: – Scale, financial strength and experience – Strong development track record – Incentives properly aligned with YieldCo
Slide 12: NEP has diversified its high-quality asset base
NEP has diversified its high-quality asset base while maintaining the long contract life, minimal commodity risk, and largely investment-grade counterparty mix of its portfolio NEP Portfolio Characteristics Counterparty Credit(1,2) Contract Life(2) A2 A3 21 Years 19 Years IPO 7/5/2016 IPO 7/5/2016 A
Slide 13: Accretive acquisitions have supported significant growth in CAFD and LP distributions
Accretive acquisitions funded by access to both equity and debt have supported significant growth in cash available for distribution (CAFD) and LP distributions NEP Portfolio Additions Renewables Capacity(1) Pipeline Assets 2,656 MW ~4 Bcf 990 MW 0 IPO 7/5/2016 IPO 7/5/2016 Run-Rate CAFD(2) Annualiz
Slide 14: NextEra Energy announced agreement to acquire an 80% interest in Oncor
NextEra Energy announced agreement to acquire an 80% interest in Oncor Electric Delivery Company (Oncor) Oncor Transaction Overview • Oncor expected to add an attractive, rate regulated T&D utility to NextEra Energy – NextEra Energy’s proven track record of providing affordable, reliable electric se
Slide 15: Agreement is part of an overall Plan of Reorganization
Agreement is part of an overall Plan of Reorganization designed to allow EFH to emerge from chapter 11 bankruptcy Transaction Structure • Overall EFH Plan of Reorganization: – Tax-free spin-off of merchant generation and retail electricity service businesses – NextEra Energy would acquire 100% of th
Slide 16: We expect the transaction to close in the first quarter of 2017
Based on our current targets for completing key milestones, we expect the transaction to close in the first quarter of 2017 Expected Timeline and Solicitation Rights • Transaction remains subject to certain conditions: – EFH bankruptcy approvals include: Approval of EFH entering into merger agreemen
Slide 17: Combination of NextEra Energy and Oncor expected to create benefits for all stakeholders
Combination of NextEra Energy and Oncor expected to be a compelling opportunity to create benefits for all stakeholders Expected Benefits for All Stakeholders • NextEra Energy’s proven track record of providing affordable, reliable electric service for customers complements Oncor’s operational stren
Slide 18: We have a long-term track record of delivering value to shareholders
We have a long-term track record of delivering value to shareholders Adjusted Earnings Per Share(1) Total Shareholder Return(2) $5.71 2% 1.4% 70% 65% $5.30 $4.97 0.7% 1% 60% $4.30 $4.39 $4.57 53% $3.84 $4.05 0% 50% $3.49 (1%) 39% $3.04 40% $2.63 (2%) 30% (3%) (4%) 20% (5%) 10% (4.8%) (6%) 0% One Yea
Slide 19: Adjusted Earnings Per Share Expectations
NextEra Energy’s Adjusted Earnings Per Share Expectations(1) 2016 $5.85 - $6.35 $6.60 - $7.10 2018 (6% - 8% CAGR off a 2014 base) (1) See Appendix for definition of Adjusted Earnings expectations 19
Slide 20: NextEra Energy Partners' Adjusted EBITDA and CAFD Expectations
NextEra Energy Partners’ Adjusted EBITDA and CAFD Expectations(1,2) Adjusted EBITDA CAFD 12/31/16 Run Rate(3) $670 - $760 MM $230 - $290 MM Unit Distributions 2016 $1.38 - $1.41 annualized rate by year end(4) 2016 - 2020 12% - 15% average annual growth(5) (1) See Appendix for definition of Adjusted
Slide 21: Our growth strategy has led to real change in relative position
Over a sustained period of time, our growth strategy has led to real change in relative position Top 20 Global Utility Equity Market Capitalization(1) As of 6/1/2001 ($ MM) As of 9/2/2016 ($ MM) Rank Market Cap Rank Market Cap 1 $38,574 1 $56,886 NextEra Energy 2 $38,185 2 $55,285 3 $34,476 3 $53,64
Slide 22: Appendix
Appendix NExTera’ NexTera energy” ENERGY & PARTNERS 2 22
Slide 23: NextEra Energy
NExTera’ ENERGY @
Slide 24: Contracted Renewables Development Program
Contracted Renewables Development Program(1,2) Wind Location MW COD Solar Location MW COD Breckinridge OK 98 2015 Shafter CA 20 2015 Goshen Ontario 102 2015 Adelanto I & II CA 27 2015 East Durham Ontario 22 2015 McCoy Solar CA 250 2016 Cedar Point JV Ontario 50 2015 Blythe CA 110 2016 Golden Hills C
Slide 25: Reconciliation of Earnings Per Share to Adjusted Earnings Per Share
Reconciliation of Earnings Per Share Attributable to NextEra Energy, Inc. to Adjusted Earnings Per Share 25
Slide 26: Reconciliation of Adjusted Earnings to GAAP Net Income (Six Months 2016)
Reconciliation of Adjusted Earnings to GAAP Net Income Attributable to NextEra Energy, Inc. (Six Months Ended June 30, 2016) Florida Pow er Energy Corporate & NextEra Energy, (m illions, except per share am ounts) & Light Resources Other (1) Inc. Net Incom e (Loss) Attributable to NextEra Energy, In
Slide 27: Reconciliation of Adjusted Earnings to GAAP Net Income (Six Months 2015)
Reconciliation of Adjusted Earnings to GAAP Net Income Attributable to NextEra Energy, Inc. (Six Months Ended June 30, 2015) Florida Pow er Energy Corporate & NextEra Energy, (m illions, except per share am ounts) & Light Resources Other Inc. Net Incom e (Loss) Attributable to NextEra Energy, Inc. $
Slide 28: Definitional information
Definitional information NextEra Energy, Inc. Adjusted Earnings Expectations This presentation refers to adjusted earnings per share expectations. Adjusted earnings expectations exclude the unrealized mark-to-market effect of non-qualifying hedges, net OTTI losses on securities held in NextEra Energ
Slide 29: Cautionary Statement And Risk Factors That May Affect Future Results
Cautionary Statement And Risk Factors That May Affect Future Results This presentation contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical facts, bu
Slide 30: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) potential volatility of NextEra Energy's results of operations caused by sales of power on the spot market or on a short-term contractual basis; effect of reductions in the liquidity of energy markets on NextEra Energy's ab
Slide 31: Forward Looking Statements
Forward Looking Statements Forward-looking statements also include, but are not limited to, statements about the anticipated benefits of the proposed merger involving NEE and EFH, including future financial or operating results of NEE or Oncor, NEE’s, EFH’s or Oncor’s plans, objectives, expectations
Slide 32: NextEra Energy Partners
NExTera energy” PARTNERS Z
Slide 33: Expected Cash Available for Distribution
Expected Cash Available for Distribution(1) (December 31, 2016 Run Rate CAFD) $750-$840(2) ($10-$20) ($40-$60) $670-$760 ($240-$260)(3) ($155-$205)(4) $ MM ($25-$30)(5) ($3-$8) $230-$290(6) Project-level Corporate IDR Adjusted Debt Service Pre-tax Non-Cash Maintenance Estimated Adjusted Expenses Fee
Slide 34: Definitional information
Definitional information NextEra Energy Partners, LP. Adjusted EBITDA and CAFD Expectations This presentation refers to adjusted EBITDA and CAFD expectations. NEP’s adjusted EBITDA expectations represent projected (a) revenue less (b) fuel expense, less (c) project operating expenses, less (d) corpo
Slide 35: Cautionary Statement And Risk Factors That May Affect Future Results
Cautionary Statement And Risk Factors That May Affect Future Results This presentation contains “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements are not statements of historical facts, but instead represent the current expectations of NextEra
Slide 36: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) NEP may incur significant costs and liabilities as a result of pipeline integrity management program testing and any necessary pipeline repair or preventative or remedial measures; The Texas pipelines’ operations could incu
Slide 37: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) Acquisitions of existing clean energy projects involve numerous risks; Renewable energy procurement is subject to U.S. state and Canadian provincial regulations, with relatively irregular, infrequent and often competitive p
Slide 38: Cautionary Statement And Risk Factors (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) Holders of NEP's common units have limited voting rights and are not entitled to elect NEP's general partner or NEP GP’s directors; NEP's partnership agreement restricts the remedies available to holders of NEP's common uni
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