Centerpoint Energy, Inc (holding Co) · NYSE:CNP
Centerpoint Energy, Inc (holding Co) — Investor Presentation (June 2018)
18 slides from Centerpoint Energy, Inc (holding Co)'s investor presentation, Jun 13, 2018
Slide 1: CenterPoint Energy Investor Update
CENTERPOINT ENERGY INVESTOR UPDATE Business Outlook and Merger Review JUNE 13, 2018
Slide 2: Cautionary Statement
Cautionary Statement This presentation and the oral statements made in connection herewith contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical f
Slide 3: Additional Information
Additional Information Use of Non-GAAP Financial Measures In addition to presenting its financial results in accordance with generally accepted accounting principles (“GAAP”), including presentation of net income and diluted earnings per share, the Company also provides guidance based on adjusted ne
Slide 4: Agenda
Agenda • CenterPoint Energy Vision and Strategy • Business Segment Review – Electric Transmission and Distribution – Natural Gas Distribution – Energy Services – Midstream Investments • CenterPoint Energy – Vectren Merger – Operations Overview – Strategic Rationale – Financing Plan 4
Slide 5: CenterPoint Vision and Strategy
CenterPoint Vision and Strategy Our Vision: Lead the nation in delivering energy, service and value • We are a premier U.S. energy delivery company • Delivering energy is CenterPoint Energy’s core business • Delivering service and value applies to all stakeholders Our Strategy: Operate, Serve, Grow
Slide 6: Electric Transmission and Distribution Highlights
Electric Transmission and Distribution Highlights • TDU core operating income was $99 million in Q1 2018 compared to $66 million in Q1 2017 • Added almost 40,000 electric customers year over year • Completed construction on and energized the Brazos Valley Connection Project in March 2018, ahead of s
Slide 7: Natural Gas Distribution Highlights
Natural Gas Distribution Highlights • Natural Gas Distribution operating income was $156 million in Q1 2018 compared to $168 million in Q1 2017 • Added more than 31,000 natural gas distribution customers year over year • Minnesota PUC approved rate case settlement • Decoupling made a permanent part
Slide 8: Energy Services Highlights
Energy Services Highlights Adjusted Operating Income • Operating income was $54 million in Q1 2018 compared to $20 million in Q1 2017, excluding a mark-to-market loss of $80 million and gain of $15 million, respectively • Successful integration of recent acquisitions have resulted in commercial oppo
Slide 9: Midstream Investments Highlights
Midstream Investments Highlights • Record quarterly natural gas gathered volumes, processed volumes, natural gas liquids production and intrastate transported volumes(1) • 40 rigs are currently drilling wells to be connected to Enable’s gathering and processing systems(2) • Enable does not expect to
Slide 10: CenterPoint and Vectren Merger
CenterPoint and Vectren Merger
Slide 11: Post-Merger CenterPoint at a Glance
Post-Merger CenterPoint at a Glance(1) 7+ million customers Electric Utility Services • Electric transmission and distribution operations with ~2.4 million metered customers across ~5,000 sq miles in and around Houston, Texas • Electric generation, transmission, and distribution to ~145,000 metered
Slide 12: CenterPoint – Vectren Combined Business Profile
CenterPoint – Vectren Combined Business Profile Combined 2017 Operating Income and Equity Earnings(1) Combined Company: 22% (Midstream) 18% (Midstream) 5% (Other) 6% 73% (Other) (Utility) 76% (Utility) 13% (Other) Increased percentage of regulated earnings provides greater confidence in long-term ea
Slide 13: CenterPoint – Vectren Merger Strategic Rationale
CenterPoint – Vectren Merger Strategic Rationale Combining Vectren and CenterPoint further positions the company as a customer-centric, technology-focused, energy-delivery company • Growth • Combined capital investment of more than $2 billion per year expected through 2022 • More customers for exist
Slide 14: Customer Loyalty Building Blocks
Customer Loyalty Building Blocks Become customers’ trusted energy solutions provider of choice Actions Develop customer- Embrace customer Engage customers Deliver best-in-class centered products behaviors and from an enterprise customer experience and services mindset view Goal Drive long-term growt
Slide 15: Combined 2020 EPS Potential
Combined 2020 EPS Potential (in millions, except per share amounts) 2020 CenterPoint Net Income Forecast $764 - $794 (High-end of $1.50 - $1.60 2018 guidance basis EPS range with 5 - 7% growth in 2019 and 2020)(1) Vectren Net Income Forecast $266 - $276 (Midpoint of $2.80 - $2.90 2018 guidance basis
Slide 16: Expected Financing Plan
Expected Financing Plan CenterPoint remains committed to solid investment grade credit quality, targeting BBB or better credit ratings at publicly rated borrowing entities • Sources of approximately $6 billion purchase price: • $2.5 billion CNP equity(1) – Common equity and/or – Other equity content
Slide 17: Credit Outlook
Credit Outlook CenterPoint met with all three rating agencies in advance of announcement; they published on April 24, one day after the announcement • Enhanced business risk profile as determined by rating agencies • Constructive regulatory jurisdictions with efficient capital recovery mechanisms in
Slide 18: Planned CERC Reorganization Activities
Planned CERC Reorganization Activities(1) Internal Spin of Midstream Investment out of CERC Objectives • Move CERC toward a pure CNP Inc. natural gas LDC company; providing better visibility of earnings • CNP Midstream spin includes Spin of debt with that investment CERC(2) Enable CNP Midstream Inte
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