Txnm Energy, Inc. · NYSE:TXNM
Txnm Energy — FY2024 Earnings Presentation
30 slides from Txnm Energy's earnings presentation, Feb 21, 2025
Slide 1: 2024 Earnings Review and 2025 Earnings Guidance
2024 Earnings Review and 2025 Earnings Guidance February 21, 2025
Slide 2: Safe Harbor Statement
Safe Harbor Statement Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 Statements made in this presentation for TXNM Energy, Inc. (“TXNM”), Public Service Company of New Mexico (“PNM”), or Texas-New Mexico Power Company (“TNMP”) (collectively, the “Company”) that rela
Slide 3: Overview and Highlights
Overview and Highlights “eI te ee | sae “am : Te Sb Se et + — +— Joa a cane 1 res GULL DY A 3-4} ___ 4,
Slide 4: 2024 Financial Results and Company Updates
2024 Financial Results and Company Updates Financial Results and Growth Outlook 2024 earnings results • 2024 results at high end of guidance achieve expectations • $2.67 GAAP EPS, $2.74 Ongoing EPS • 2025 Ongoing EPS guidance range of $2.74 - $2.84 EPS growth target • Reflects mid-year implementatio
Slide 5: Utility Highlights
Utility Highlights
Slide 6: TNMP 2024 Highlights
TNMP 2024 Highlights Continued system-wide growth TNMP System Peak • New all-time system peak in December: 2,993 MW 2,993 • 7th new system peak of 2024 2,545 Peak MW • 18% increase over 2023 peak 2,240 • 600+ MW data center load in service 2,030 1,804 • ~200 MW added during Q4 • Interconnection requ
Slide 7: TNMP 2025-2029 Outlook
TNMP 2025-2029 Outlook Focus on supporting strong growth TNMP Capital Investment Plan with a reliable and resilient grid • $4.2b capital investment program $1,048 $1,008 supports: (in millions) $818 $615 $676 • Growing core system needs • Permian Basin Reliability Study: “common” projects in process
Slide 8: PNM 2024 Highlights
PNM 2024 Highlights Energy Transition PNM Resource Portfolio • ~1,500 MW previously approved solar and battery MW Capacity storage resources brought into service in 2024 2016 2026 • 2026 Resource Application approved in May 2024 Renewables Coal Nuclear 15% Renewables • 100 MW Solar facility 4% 14% 4
Slide 9: PNM 2025-2029 Outlook
PNM 2025-2029 Outlook Focus on balancing customer affordability with infrastructure needs PNM Capital Investment Plan $714 $716 $676 • Phase-in of customer rates as part of 2025 $648 $112 $663 rate request and stipulation $219 $127 $67 $205 (in millions) • Regional coordination provides access to lo
Slide 10: Financial Updates
Financial Updates
Slide 11: Highlights of 2024 Ongoing Earnings Results
Highlights of 2024 Ongoing Earnings Results 2024 Earnings Summary $2.74 2024 earnings results at Narrowed Guidance high end guidance $2.70 $2.75 $2.65 Original Guidance $2.75 Key Drivers vs 2023 + Rate Recovery: TNMP TCOS and DCRF, PNM Retail, FERC formula rate + Retail load growth, offset by mild
Slide 12: 2025 Earnings Guidance (Ongoing)
2025 Earnings Guidance (Ongoing) 2025 Earnings Guidance $2.74 Consolidated EPS $2.84 2025 earnings guidance $2.79 introduced Guidance Midpoint PNM TNMP Corp/Other $2.00 $1.38 ($0.59) Estimated Quarterly Ongoing EPS Distribution Quarterly distribution 56% continues to be heavily weighted towards Q3 1
Slide 13: Capital Investment Plan 2025 - 2029
Capital Investment Plan 2025 - 2029 5-year capital investment plan of $7.8 billion $1,774 $1,721 $1,582 $50 $50 $127 $67 $1,436 $48 $1,321 $46 $219 $58 $112 $549 $596 $205 (in millions) $497 $602 $443 $1,048 $591 $1,008 $640 $502 $818 $544 $615 $405 $676 2025 2026 2027 2028 2029 TNMP PNM T&D PNM Gen
Slide 14: Financing Plan
Financing Plan 2024 Financing Activities Long-term Debt Maturities • Completed 2024 equity needs of ~$100 in millions(1) million through ATM program $550 • Sold $50 million additional equity in Q4 2024 for settlement in 2025 $1,278 • Issuance of junior subordinated $60 convertible bonds in Q2 2024 $
Slide 15: 2025 - 2029 Potential Earnings Power
2025 - 2029 Potential Earnings Power 7% - 9% EPS Growth 2025-2029(1) 2025 2026 Earnings 2027 Earnings 2028 Earnings 2029 Earnings Allowed Guidance Equity Potential Potential Potential Potential Midpoint Return / Avg Avg Avg Avg Avg Ratio Rate EPS Rate EPS Rate EPS Rate EPS Rate EPS Base Base Base Ba
Slide 16: Appendix
Appendix
Slide 17: TNMP and PNM Key Regulatory Items
TNMP and PNM Key Regulatory Items Filing Action Timing Docket No. Pending approval; decision expected at System Resiliency Plan Filed August 28, 2024 56954 March 13, 2025, open meeting Transmission Cost of Filed January 24, 2025 Expected to be implemented March 2025 57578 Service (1st 2025 filing) T
Slide 18: Key Drivers of PNM 2025 Rate Request
Key Drivers of PNM 2025 Rate Request • PNM filed its application in June 2024 for rates effective beginning July 2025 • PNM and parties filed an unopposed settlement on November 26, 2024 • Hearings held February 17-18, 2025; decision expected in Q2 2025 Total Revenues Request Settlement Rate base in
Slide 19: Key Drivers of PNM 2025 Rate Request
Key Drivers of PNM 2025 Rate Request Key Settlement Component Settlement Terms Ongoing Earnings Per Share Considerations $430m new investments Rate base investments +$0.22 return on new investments Dec 2024-June 2026 Equity financing costs (ROE) 9.45% +$0.04 vs currently authorized 9.26% Capital str
Slide 20: Q4 and FY 2024 vs 2023 EPS (Ongoing): TNMP
Q4 and FY 2024 vs 2023 EPS (Ongoing): TNMP TNMP • Rate relief from $1.11 $1.15 implementation of TCOS and DCRF increases $0.25 $0.27 • Completion of AMS amortization Q4 2023 Q4 2024 FY 2023 FY 2024 • Lower O&M expenses Q4 2024 FY 2024 2024 Key Performance Drivers vs vs • Lower customer usage driven
Slide 21: Q4 and FY 2024 vs 2023 EPS (Ongoing): PNM
Q4 and FY 2024 vs 2023 EPS (Ongoing): PNM • Strong realized decommissioning / PNM $2.22 $2.16 reclamation trust performance in 2024 compared to 2023 • Retail load growth, offset by lower weather-related usage (hotter $0.19 $0.10 temperatures in Q3 2023) • New retail rates implemented in Q4 2023 Q4 2
Slide 22: Q4 and FY 2024 vs 2023 EPS (Ongoing): Corporate
Q4 and FY 2024 vs 2023 EPS (Ongoing): Corporate Corporate ($0.17) ($0.16) ($0.51) ($0.57) Q4 2023 Q4 2024 FY 2023 FY 2024 • Dilutive impact of additional shares issued in 2023 Q4 2024 FY 2024 • Sale of NMRD in early 2024 2024 Key Performance Drivers vs vs Q4 2023 FY 2023 • Higher interest rates on D
Slide 23: Weather Impacts
Weather Impacts Q4 Q4 Q4 FY FY FY TNMP 2024 2023 Normal(1) 2024 2023 Normal(1) Cooling Degree Days 494 306 339 3,553 3,652 3,240 Heating Degree Days 356 559 565 1,186 1,318 1,512 Net EPS Impact compared to Normal ($0.00) ($0.01) $0.01 $0.05 Q4 Q4 Q4 FY FY FY PNM 2024 2023 Normal(1) 2024 2023 Normal(
Slide 24: TNMP EPS Guidance (Ongoing)
TNMP EPS Guidance (Ongoing) TNMP $1.38 $1.15 2024 2025E 2025 Key Performance Drivers 2025E vs 2024 Distribution rate relief (DCRF) $0.26 – $0.28 Transmission rate relief (TCOS) $0.10 – $0.13 Retail load and weather $0.04 – $0.08 AFUDC $0.05 – $0.07 O&M expenses $0.02 – $0.04 Dilution ($0.04) Interes
Slide 25: PNM EPS Guidance (Ongoing)
PNM EPS Guidance (Ongoing) PNM $2.16 $2.00 2024 2025E 2025 Key Performance Drivers 2025E vs 2024 PNM Retail rate relief $0.23 Retail load and weather $0.07 – $0.15 Transmission margins $0.14 - $0.16 AFUDC $0.07 - $0.09 Decommissioning / reclamation trust performance ($0.01) - $0.01 Dilution ($0.06)
Slide 26: Corporate and Other EPS Guidance (Ongoing)
Corporate and Other EPS Guidance (Ongoing) Corporate and Other ($0.57) ($0.59) 2024 2025E 2025 Key Performance Drivers 2025E vs 2024 Dilution $0.02 Other $0.03 Interest expense ($0.08) – ($0.06) 26
Slide 27: 2025 Assumptions
2025 Assumptions Amounts shown are before tax, unless otherwise noted 2025E PNM Residential/Commercial Load Growth 1% = $0.05 EPS Industrial Load Growth 1% = $0.01 EPS Anticipated Ongoing effective tax rate (Statutory rate = 25.4%) ~23% before amortization of excess deferred income taxes Amortizatio
Slide 28: 2025 - 2029 Potential Earnings Power
2025 - 2029 Potential Earnings Power 2025 2026 Earnings 2027 Earnings 2028 Earnings 2029 Earnings Allowed Guidance Equity Potential Potential Potential Potential Midpoint Return / Avg Avg Avg Avg Avg Ratio Rate EPS Rate EPS Rate EPS Rate EPS Rate EPS Base Base Base Base Base 9.45% / PNM Retail 51% (
Slide 29: Liquidity as of February 14, 2025
Liquidity as of February 14, 2025 Corporate/ TXNM Energy PNM TNMP Other Consolidated Financing Capacity(1): (In millions) Revolving credit facilities $440.0 $200.0 $300.0 $940.0 As of 02/14/25: Short-term debt and 219.3 112.2 147.8 479.3 L/C balances Remaining availability 220.7 87.8 152.2 460.7 Inv
Slide 30: Selected Balance Sheet Information
Selected Balance Sheet Information (In millions) Dec. 31, 2023 Dec. 31, 2024 Long-Term Debt (incl. current portion) (1) PNM $2,261.8 $2,459.6 TNMP 1,260.9 1,464.1 Corporate/Other 999.1 999.7 Consolidated $4,521.8 $4,923.4 Total Debt (incl. short-term) (1,2) PNM $2,399.3 $2,823.4 TNMP 1,316.0 1,615.7