Slide 1: 1st Quarter 2016 Earnings Conference Call
EXHIBIT 99.2 1st Quarter 2016 Earnings Conference Call April 26, 2016
Slide 2: Safe Harbor Statement
Safe Harbor Statement Many factors impact forward-looking statements including, but not limited to, the following: impact of regulation by the EPA, FERC, MPSC, NRC, and CFTC, as well as other applicable governmental proceedings and regulations, including any associated impact on rate structures; the
Slide 3: Participants
• Gerry Anderson – Chairman and CEO • Jerry Norcia – President and COO • Peter Oleksiak – Senior Vice President and CFO • Barbara Tuckfield – Director, Investor Relations 3 Participants
Slide 4: Overview, 1st Quarter 2016 Financial Update, Summary
• Overview • 1st Quarter 2016 Financial Update • Summary 4
Slide 5: We continue to make progress on many fronts
We continue to make progress on many fronts 5 Financial performance Strong 1st quarter financial results Well positioned to achieve 2016 EPS* guidance Legislation Senate hearings and key stakeholder testimony this week Key provisions allow for constructive policy NEXUS project On track for 4th quart
Slide 6: 2016 has started out strong and we are confident in achieving guidance
6 2016 has started out strong and we are confident in achieving our guidance for the year • 1st quarter 2016 operating EPS* of $1.52 • On track to achieve 2016 operating EPS guidance range of $4.80 to $5.05 • Targeting 10th consecutive year of meeting or exceeding operating EPS initial guidance and
Slide 7: Energy legislation continues to be a priority for the state
7 Energy legislation continues to be a priority for the state and there is positive momentum • Occurring this week − Senate hearings to introduce substitute bills (SB437 and SB438) − Testimony expected from key stakeholders including MISO • Key provisions include − Capacity requirements for all elec
Slide 8: NEXUS project is progressing
8 NEXUS project is progressing and originates in the most economical geology in the country • Project on track for 4th quarter 2017 in-service • 1st quarter accomplishments − Increased interconnect agreements from 1.4 Bcf/d to 1.75 Bcf/d − Ordered compressors − Continued to advance work with FERC an
Slide 9: We remain confident in delivering 5%-6% operating EPS growth target
$4.82 $2.35 $2.48 $2.62 $2.76 $2.92 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 We remain confident in delivering 5%-6% operating EPS* growth target 9 * Reconciliation to GAAP reported earnings included in the appendix (dollars per share) Operating EPS Dividend Actuals Forecast Dividend per sh
Slide 10: Overview, 1st Quarter 2016 Financial Update, Summary
• Overview • 1st Quarter 2016 Financial Update • Summary 10
Slide 11: DTE Energy 1st Quarter 2016 Operating Earnings Variance
DTE Energy 1st Quarter 2016 Operating Earnings* Variance 1Q 2015 1Q 2016 Change DTE Electric 136$ 127$ (9)$ DTE Gas 111 87 (24) Gas Storage & Pipelines 27 30 3 Power & Industrial Projects 33 21 (12) Corporate & Other (25) (7) 18 Growth segments** 282$ 258$ (24)$ Growth segments operating EPS 1.58$ 1
Slide 12: Capital Expenditures Summary
Capital Expenditures Summary 12 Drivers 1Q 2015 1Q 2016 DTE Electric Distribution Infrastructure $130 $111 New Generation 242 13 Maintenance & Other 180 191 $552 $315 DTE Gas Base Infrastructure $44 $58 Nexus Related - 2 Main Replacement* 11 19 $55 $79 Non-Utility $60 $57 Total $667 $451 • DTE Elect
Slide 13: Focus remains on key areas to improve distribution reliability
Focus remains on key areas to improve distribution reliability 13 $6.5 billion investment over the next 10 years • Replace aging infrastructure • Address overloaded substations • Enhance technology Customer benefits • Reduce restoration time • Improve reliability • Decrease outages • Create and supp
Slide 14: Expanded main renewal program and gas infrastructure upgrades
14 $600 million investment from 2016-2020 • Replace ~4,000 miles of cast iron and unprotected steel main • Cut timeline in half from 50 to 25 years Customer benefits • Reduce leaks and lost gas • Create and support Michigan jobs Continued focus on expanded main renewal program and upgrading gas infr
Slide 15: A strong balance sheet remains a key priority to support growth
25% 21% 2014 2015 2016-2018E 51% 52% 2014 2015 2016-2018E Leverage* A strong balance sheet remains a key priority to support growth * Debt excludes securitization, a portion of DTE Gas’ short-term debt, and considers 50% of the Junior Subordinated Notes as equity Funds from Operations** / Debt* Targ
Slide 16: Overview, 1st Quarter 2016 Financial Update, Summary
• Overview • 1st Quarter 2016 Financial Update • Summary 16
Slide 17: Summary
Summary • Confident we will achieve our 2016 operating EPS* guidance... ...extending our streak to 10 consecutive years meeting or exceeding guidance • Utilities continue to invest in infrastructure improvements... ...which will fundamentally renew Michigan’s infrastructure and enhance customer reli
Slide 18: Contact Us
DTE Energy Investor Relations www.dteenergy.com/investors (313) 235-8030 18 Contact Us
Slide 19: Appendix
Appendix
Slide 20: We are confident we will achieve our 2016 operating EPS guidance
We are confident we will achieve our 2016 operating EPS* guidance * Reconciliation to GAAP reported earnings included in the appendix ** Total DTE Energy excluding Energy Trading 2016 Guidance 1Q 2016 Actuals DTE Electric DTE Gas Gas Storage & Pipelines Power & Industrial Projects Corporate & Other
Slide 21: DTE Electric Variance Analysis
$136 ($18) $36 ($19) ($8) $127 1 Q 2 0 1 5 O p e rati n g E a rn in g s W e a th e r Ra te Impl e m e n ta ti o n 2 0 1 5 R e v e n u e Dec o u p le r A m o rtiza ti o n Ra te B a s e / O th e r 1 Q 2 0 1 6 O p e rati n g E a rn in g s * Reconciliation to GAAP reported earnings included in the appen
Slide 22: Cash Flow Summary
Cash Flow Summary Drivers 1Q 2015 1Q 2016 Cash From Operations* $0.8 $0.7 Capital Spending (0.7) (0.5) Free Cash Flow $0.1 $0.2 Asset Sales & Other - - Dividends (0.1) (0.1) Net Cash $0.0 $0.1 Debt Financing: Issuances $0.5 - Redemptions (0.5) (0.1) Change in Debt $0.0 ($0.1) • DTE Electric capital
Slide 23: 2016 Cash Flow and Capital Guidance
Cash Flow Summary DTE Energy 2016 Cash Flow and Capital Guidance 2015 Actual 2016 Guidance Cash From Operations* $1.9 $1.8 Capital Spending (2.3) (2.7) Free Cash Flow ($0.4) ($0.9) Asset Sales & Other $0.1 - Dividends (0.5) (0.5) Net Cash ($0.8) ($1.4) Debt Financing: Issuances $1.1 $1.9 Redemptions
Slide 24: DTE rate case highlights
Approved by MPSC on December 11, 2015 Filed December 18, 2015 Filed February 1, 2016 DTE Electric Rate Case 2014 DTE Gas Rate Case 2015 DTE Electric Rate Case 2016 DTE rate case highlights • Rate recovery: $243 million • Test year: July 1, 2015 to June 30, 2016 • Return on Equity: 10.3% • Cost of Ca
Slide 25: Interconnect agreements support NEXUS path up to 1.75 Bcf/d
Interconnect agreements provide strong support on the NEXUS path up to 1.75 Bcf/d 25
Slide 26: Michigan's economy continues to improve
8.5% 7.1% 5.4% 5.0% 4.9% 2013 2014 2015 2016E 2017E Michigan’s economy continues to improve 26 Source: IHS 15.1 15.8 18.6 21.9 22.7 2013 2014 2015 2016E 2017E Unemployment Rate Housing Start Ups (000s) Greatest improved state addressing 21st century challenges*** Lowest unemployment since 2001 7th m
Slide 27: Weather and DTE Electric Weather Normal Sales
Weather and DTE Electric Weather Normal Sales 27 * Includes adjustments for temperature normalization and customer outages due to weather ** Includes choice of 1,243 1Q 2015 and 1,164 1Q 2016 YTD 2015 YTD 2016 % change YTD 2015 YTD 2016 % change Actuals - - Actuals 3,791 2,917 -23% Normal - - Normal
Slide 28: DTE Energy Trading Reconciliation of Operating Earnings to Economic Net Income
DTE Energy Trading Reconciliation of Operating Earnings* to Economic Net Income 1Q 2016 Economic Net Income Accounting Adjustments** 1Q 2016 Operating Earnings* $12 $20 • Economic net income equals economic gross margin*** minus O&M expenses and taxes • DTE Energy management uses economic net income
Slide 29: First Quarter 2016 Reconciliation of Reported to Operating Earnings
29 1Q 2016 DTE Electric DTE Gas Gas Storage and Pipelines Power and Industrial Projects Corporate and Other Growth Segments Energy Trading DTE Energy Reported Earnings 127$ 87$ 30$ 17$ (7)$ 254$ (7)$ 247$ Plant closure - - - 4 - 4 - 4 Certain mark-to-market transactions - - - - - - 23 23 Operating E
Slide 30: First Quarter 2015 Reconciliation of Reported to Operating Earnings
30 Use of Operating Earnings Information – DTE Energy management believes that operating earnings provide a more meaningful representation of the company’s earnings from ongoing operations and uses operating earnings as the primary performance measurement for external communications with analysts an
Slide 31: 2011 – 2015 Full Year Reconciliation of Reported to Operating Earnings
2011 – 2015 Full Year Reconciliation of Reported to Operating Earnings 31 Use of Operating Earnings Information – DTE Energy management believes that operating earnings provide a more meaningful representation of the company’s earnings from ongoing operations and uses operating earnings as the prima
Slide 32: Use of Operating Earnings Information
Use of Operating Earnings Information – DTE Energy management believes that operating earnings provide a more meaningful representation of the company’s earnings from ongoing operations and uses operating earnings as the primary performance measurement for external communications with analysts and i