Southern Company (the) · NYSE:SO
Southern Company (the) — The Southern Company — Q2 2020 Earnings Presentation
23 slides from Southern Company (the)'s earnings presentation, Jul 30, 2020
Slide 1: Second Quarter 2020 Earnings Conference Call
Second Quarter 2020 Earnings Conference Call July 30, 2020
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding Forward-Looking Statements Certain information contained in this presentation is forward‐looking information based on current expectations and plans that involve risks and uncertainties. Forward‐looking information includes, among other things, financial objectives, earning
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures In addition to including earnings in accordance with generally accepted accounting principles (GAAP), this presentation also includes historical adjusted earnings and earnings per share (EPS) excluding: (1) impacts related to (a) the sale of Gulf Power, (b) the sales of P
Slide 4: Q2 2020 Highlights
Q2 2020 Highlights • Strong adjusted financial results for the quarter of $0.78, well above our earnings estimate of $0.65 – COVID-19 revenue impact less than expected for the quarter – Cost control efforts have mitigated impact of COVID-19 and mild weather • Georgia Power’s share of total capital c
Slide 5: Vogtle 3 & 4
Vogtle 3 & 4 • We are focused on meeting November 2021 and 2022 regulatory-approved in- service dates – Aggressive site work plan target in-service dates remain May 2021 and 2022, respectively, for Units 3 & 4 » Even if fuel load were three months later, it still supports an in-service date in the s
Slide 6: Vogtle 3 & 4
Vogtle 3 & 4 • Unit 3 production continues to exceed estimated needs under November benchmark schedule • Unit 3 direct construction ~90% complete – Re-evaluated estimates for cost and time to complete the final phases of construction, which resulted in hours being added to direct construction for bo
Slide 7: Vogtle Unit Direct Construction & Major Milestones
Vogtle Unit 3 Direct Construction & Major Milestones (Direct Construction is Bechtel’s Scope of Work) MONTHLY % CUMULATIVE % 6% 100% Additional hours added to the estimate to complete Unit 3 In-service 5% Fuel Load 90% Start Hot Functional Testing 4% Margin to regulatory 80% Initial Energization Mai
Slide 8: Vogtle 3 & 4 Cost Estimate
Vogtle 3 & 4 Cost Estimate Projected Estimated Cost of Project ($M) (Georgia Power's 45.7% share) Base project capital cost forecast to May $7,770 Schedule cost margin to November 247 Total base project capital cost forecast to November $8,017 =$361M Cost contingency allocated to date 400 Cost conti
Slide 9: Q2 2020 Earnings Results
Q2 2020 Earnings Results 2Q YTD 2020 2019 2020 2019 Earnings Per Share As Reported $0.58 $0.86 $1.40 $2.86 Less: Acquisition and Disposition Impacts1 - $0.05 $0.02 $1.30 Estimated Loss on Plants Under Construction2 ($0.11) ($0.01) ($0.11) ($0.01) Asset Impairment3 ($0.07) - ($0.07) - Wholesale Gas S
Slide 10: Q2 2020 & YTD Year-Over-Year Adjusted Drivers
Q2 2020 & YTD Year-Over-Year Adjusted Drivers 1 (10¢) 4¢ (2¢) 1¢ (2¢) $1.56 $0.80 1¢ $0.04 (2¢) 2¢($0.11) (1¢) 6¢ 5¢ $0.78 $1.50 (11¢) 10¢ Parent & Southern Southern $0.08 Shares 3¢ Southern Southern Parent & Other Company Power 2 Shares LDCs $0.36 O&M 22 O&M Company Power2 Other Rates, Gas LDCs $0.
Slide 11: COVID-19 Sales Impacts-to-Date and 2020 Outlook
COVID-19 Sales Impacts-to-Date and 2020 Outlook 2Q 2020 Weather-normal sales vs. COVID-19 WN Projection 10% • 2Q 2020 weather-normal total retail kilowatt Weather-normal retail sales hour sales were consistent with our 5% Weather-normal projection projections 0% • Through June, COVID-19 impact on re
Slide 12: Improving Trends, But Uncertainty Remains
Improving Trends, But Uncertainty Remains 2.0% Seven Day Moving Average and Monthly Cumulative Impacts of COVID-19 with Average Daily Temperature Overlay 90 80 Percent Deviation of Actual Daily Energy from Pre-Covid-19 Predicted Loads 0.0% 70 -2.0% 60 -4.0% 50 Temperature 40 -6.0% 30 -8.0% 20 -10.0%
Slide 13: Q2 YTD 2020 and Projected Full Year Adjusted EPS
Q2 YTD 2020 and Projected Full Year Adjusted EPS Q2 YTD 2020 Adjusted EPS1 2020 Projected Full Year Adjusted EPS3 $0.05 $0.08 ($0.21) $0.29 All Other ($0.45) $3.22 $0.16 All Other $1.56 to Energy Parent Energy Parent LDCs $0.36 $3.10 LDCs $0.23 Infrastructure Infrastructure under under long-term lon
Slide 14: Significant Year-Over-Year Decrease in Coal Generation
Significant Year-Over-Year Decrease in Coal Generation1 2019 Total Energy Mix 2020 YTD Total Energy Mix Renewables / Renewables / Other Other 12% 18% Coal 13% Coal 22% Nuclear 16% Nuclear 18% Natural Gas Natural Gas 51% 50% 1Energy mix represents all of the energy used to serve retail and wholesale
Slide 15: Summary
Summary • Remain committed to meeting our financial objectives for 2020, including mitigation of COVID-19 impacts • Remain focused on meeting regulatory-approved in-service dates for Vogtle 3 & 4 • Continued track record of ESG leadership and transparency – Committed to a goal of net-zero emissions
Slide 16: Appendix
Appendix
Slide 17: Capital Markets / Financing
Capital Markets / Financing
Slide 18: Projected Long-term Debt Financings
Projected Long-term Debt Financings1 Actual Projected 2 Long-term Debt ($ in millions) YTD 2020 2020 (Remaining) 2021 2022 2020 - 2022 Alabama Power $300 $450 $900 $1,650 Georgia Power3 $2,019 330 1,450 800 2,580 Mississippi Power4 - 400 - 400 State-regulated Electrics $2,019 $630 $2,300 $1,700 $4,6
Slide 19: Long-term Debt Maturity Schedule
Long-term Debt Maturity Schedule1,2,3 2020-2022 maturities total $6.1 billion Long-term Debt ($ in millions) Remaining 2020 2021 2022 2020-2022 Alabama Power4 $250 $310 $750 $1,310 Georgia Power 41 523 526 1,089 Mississippi Power - 330 15 345 State-regulated Electrics $291 $1,163 $1,291 $2,744 South
Slide 20: Liquidity and Credit
Liquidity and Credit1 as of 6/30/2020 Over $7.7 billion in committed credit facilities and available liquidity of $7.8 billion (in millions) 2020 2021 2022 2023 2024 Total Credit Facility Expirations $3 $30 $675 $125 $6,900 $7,733 Alabama Georgia Mississippi Southern Southern (in millions) Power Pow
Slide 21: Vogtle 3 & 4
Vogtle 3 & 4
Slide 22: Vogtle 3 & 4 Major Milestone Definitions
Vogtle 3 & 4 Major Milestone Definitions Initial Energization- Energizing the main transformers to provide the initial supply of off-site power to the plant’s electrical distribution system needed for testing. Individual electrical components – pumps, valve, motors - will be powered providing ‘life’
Slide 23: Vogtle 3 & 4 Major Milestone Definitions
Vogtle 3 & 4 Major Milestone Definitions Cold Hydro Test- Cold Hydro Testing contains several separate tests in different areas of the plant to verify that welds, joints, pipes, and other components of the reactor coolant system, steam-supply system and associated high pressure systems do not leak a