Slide 1: Supplemental Slides First Quarter 2020 Earnings
Supplemental Slides First Quarter 2020 Earnings May 6, 2020
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of federal securities laws. Investors and prospective investors should understand that many factors govern whether any forward-looking statement contained herein will be or can be realized. Any one
Slide 3: Key Takeaways
Key Takeaways • Focused on providing safe, reliable utility service during COVID-19 pandemic • Non-GAAP Net Operating Earnings Per Share (NOEPS)* of $0.76, vs. $0.82 in 1Q2019 • Capital program, liquidity expected to remain strong in 2020 ▪ Reduced expected 2020 capital investments by $100M to $1.7B
Slide 4: First Quarter 2020 Financial Highlights
First Quarter 2020 Financial Highlights Non-GAAP* 2020 2019 Change Net Operating Earnings Available to Common $290.9 $307.7 ($16.8) Shareholders ($M) Net Operating Earnings Per Share $0.76 $0.82 ($0.06) GAAP 2020 2019 Change Net Income (Loss) Available to Common $61.8 $205.1 ($143.3) Shareholders ($
Slide 5: NiSource Debt and Credit Profile
NiSource Debt and Credit Profile • Debt level: ~$9.9B as of March 31, 2020 ▪ ~$7.7B of long-term debt ◦ Weighted average maturity ~17 years ◦ Weighted average interest rate of 4.4% • Solid liquidity position ▪ ~$1.3B in net available liquidity as of March 31, 2020* ▪ ~$2.4B of committed facilities i
Slide 6: Financing Plan Update
Financing Plan Update NiSource Current Financing Plan* 2019 2020 ($ in Millions) Actual Estimated Equity Common Equity Block None None Planned Issuance ATM (At-The-Market) $229 $200 - $300 ESPP/401K/Other $34 $35 - $60 Long-Term Debt Incremental Long-Term Debt $714 $1,000 Long-term Financing Targets
Slide 7: Gas Distribution Operations
Gas Distribution Operations • Base rate case filed in Pennsylvania • Safety & Infrastructure tracker update approved in Ohio; extension pending in Indiana • Supportive orders around COVID-related costs and bad debt in Maryland and Virginia • Continuing to execute infrastructure modernization designe
Slide 8: Electric Operations
Electric Operations • Discussions continue with select bidders in second RFP for coal replacement capacity • Incremental capital investment opportunities expected in 2022 and 2023 • Continued execution of seven-year ~$1.2B electric system modernization program Key Milestones: Highlight Key Component
Slide 9: Safety Management System (SMS)
Safety Management System (SMS) Integrating Safety, Risk Management and Investment Planning 9
Slide 10: Environmental, Social & Governance (ESG)
Environmental, Social & Governance (ESG) Longstanding ESG Program • NiSource has been reporting on sustainability and ESG for more than a decade • Climate Report published in 2019 aligned with the Task Force on Climate-related Financial Disclosures (TCFD) framework • Member of the Dow Jones Sustaina
Slide 11: Appendix: First Quarter 2020 Earnings
Appendix: First Quarter 2020 Earnings
Slide 12: COVID-19 Actions
COVID-19 Actions • Following CDC and local guidelines intended to ensure the health and safety of our employees and customers • Activated Incident Command Structure to coordinate strategy, execution and communication across all seven states • For Customers ▪ Suspended shut-offs for non-payment and a
Slide 13: COVID-19 Business Implications
COVID-19 Business Implications • Customer - impacts expected to lower revenue and cash flows ▪ Sales volume declines (Commercial and Industrial) ▪ Increased bad debt expense (due to shut-off moratorium and job losses) ▪ Long-term customer attrition • Supply Chain - no material impacts at this time ▪
Slide 14: COVID-19 Customer Demand and Bad Debt
COVID-19 Customer Demand and Bad Debt Retail Margins by Customer Class Customer Demand • Expect lower commercial and industrial sales 9% • Potential for increased residential sales 15% 26% 22% 26% Rate Design 35% • Gas Segment ◦ Residential ~75% Fixed 69% ◦ Commercial ~45% Fixed 59% • Electric Segme
Slide 15: Bad Debt Recovery Mechanisms
Bad Debt Recovery Mechanisms Bad Debt Expense Tracked Tracked Filing Company Included in Base Incremental Frequency Rates* Expense Gas Distribution NIPSCO Gas Yes Gas cost only Quarterly Gas cost and delivery Columbia Gas of Ohio Yes Annual charge Columbia Gas of Pennsylvania Yes Partial gas cost on
Slide 16: Revenue and Weather Normalization Mechanisms
Revenue and Weather Normalization Mechanisms Revenue Decoupling/ Weather Company Normalization Normalization Gas Distribution NIPSCO Gas None None Straight Fixed Variable Rates for Columbia Gas of Ohio None Residential and Small Commercial Columbia Gas of Pennsylvania None Yes - Residential Columbia
Slide 17: Capital Expenditures
Capital Expenditures Investments Expected to Deliver Customer Value, Enhance System Safety and Reliability Estimated ~ $1.8B ~ $1.9B $1.7B - $1.8B Recovery Period 15% 12% ~ 10% Within ~0-3 Months (Growth) Within ~0-18 Months 54% (Tracker) 62% ~ 70% Periodic Rate Cases (Maintenance/Other) 31% 26% ~ 2
Slide 18: Liquidity and Capitalization as of First Quarter 2020 ($M)
Liquidity and Capitalization as of First Quarter 2020 ($M) Current Liquidity Actual 3/31/2020 Maturity Revolving Credit Facility $1,850 Feb. 20, 2024 Accounts Receivable Programs* 459 Less: Drawn on Credit Facility 500 Commercial Paper 237 Accounts Receivable Programs Utilized 459 L/C's Outstanding
Slide 19: Long-Term Debt as of First Quarter 2020 ($M)
Long-Term Debt as of First Quarter 2020 ($M) Debt Detail Balance Wtd. Avg. Rate* Wtd. Avg. Maturity Long-Term Debt** $7,739 4.40% 17 years Revolving Credit Facility 500 2.13% 2.6 months Commercial Paper 237 2.02% 39 days A/R Program Borrowings 459 1.23% 1 month Term Loan*** 850 3.25% 0.5 months Capi
Slide 20: Gas Distribution Operations Infrastructure Programs
Gas Distribution Operations Infrastructure Programs Estimated Base Case Year-End Total Modernization Recovery Annual Company Authorized 2019 Rate Identified Program Mechanism ROE Base Investments Modernization Investments Program Columbia Not Specified $3.2B ~$10.4B ~$10.4B $435M - $550M Tracked Gas
Slide 21: Electric Operations Investment Programs and Generation Transition
Electric Operations Investment Programs and Generation Transition Infrastructure Investment Programs Identified Estimated Annual Recovery Base Case Program Investments Investment Mechanism Authorized ROE Infrastructure ~$5.9B ~$190M - $240M Tracked 9.75% Modernization Generation Transition Project P
Slide 22: Regulatory Update
Regulatory Update 2020 Rate Case and Program/Project Activity Company/Filing Summary Timeline In Progress Filed: Apr. 24, 2020 Columbia Gas of Pennsylvania - Base Rate Case Requested Increase: $100.4M Order Expected: Jan. 2021 Six year extension to long-term infrastructure Filed:Dec. 31, 2019 NIPSCO
Slide 23: Safety and Infrastructure Investment and Tracker Filing Details
Safety and Infrastructure Investment and Tracker Filing Details Incremental Investments Recovery Recovery Company Filing Mechanism Investment Investment Effective Date Period Amount ($M) Date FY 2018 $199.6 Feb 2019 May 2019 Columbia Gas of Infrastructure Replacement Ohio Program (IRP) FY 2019 $234.