Ameren Corporation · NYSE:AEE
Ameren — Q4 2023 Earnings Presentation
42 slides from Ameren's earnings presentation, Feb 23, 2024
Slide 1: Powering a Reliable, Sustainable Tomorrow
Powering a Reliable, Sustainable Tomorrow Fourth Quarter 2023 Earnings Feb. 23, 2024
Slide 2: Cautionary Statements
Cautionary Statements Use of Non-GAAP Financial Measures In this presentation, Ameren has presented weather-normalized and core earnings per share and operations and maintenance expenses excluding COLI, which are non-GAAP financial measures and may not be comparable to those of other companies. A re
Slide 3: Strategic and Business Update
Strategic and Business Update Marty Lyons Chairman, President and Chief Executive Officer, Ameren Corp. Ameren Missouri’s Montgomery Community Solar Energy Center
Slide 4: Our Strategic Plan
Our Strategic Plan INVEST ENHANCE OPTIMIZE Enhance regulatory Invest in rate regulated Optimize operating frameworks and advocate energy infrastructure performance for responsible policies To capitalize on opportunities to benefit our customers, communities, shareholders and the environment 2023 Res
Slide 5: Our Sustainability Value Proposition
Our Sustainability Value Proposition ENVIRONMENTAL STEWARDSHIP SOCIAL IMPACT • Responsibly transitioning to a cleaner and more diverse portfolio • Delivered value to customers in 2023 while focused on safety ‒ Target carbon reductions from 2005 levels: 60% by 2030; 85% by 2040; net ‒ Ameren-supplied
Slide 6: Review of 2023 Strategic Business Objectives
Review of 2023 Strategic Business Objectives Invest ✓ Continue robust infrastructure investment in electric, natural gas and transmission infrastructure projects Diluted EPS Guidance vs. 2023 Actual ✓ Submit bids for MISO LRTP Tranche 1 competitive projects and support analysis for potential Tranche
Slide 7: Executed Our Strategic Plan in 2023
Executed Our Strategic Plan in 2023 Invest • $3.6 billion of capital invested benefiting our customers and communities – Robust investment in electric, natural gas and transmission infrastructure projects Weather-Normalized Improved Reliability2 • Awarded Orient-Denny-Fairport and Skunk River-Ipava
Slide 8: Strong Track Record of EPS and Dividend Growth
Strong Track Record of EPS and Dividend Growth Weather-Normalized Core Dividends Paid per Share3 Total Shareholder Earnings per Diluted Share1 and Payout as a % of WN EPS Return $4.50 +112% or $2.80 ~+58% 2013 to 2023 $4.62 180% $4.25 ~7.8% CAGR 2013 to 2023 $4.41 $2.60 $2.68 | 58% , 2013 to 2023 17
Slide 9: 2024 Strategic Business Objectives
2024 Strategic Business Objectives Invest • Robust infrastructure investment in electric, natural gas and transmission infrastructure projects aligned with regulatory outcomes • Successfully complete new solar generation energy centers Enhance • Successfully conclude Ameren Illinois electric reheari
Slide 10: Expect to Deliver Strong Long-Term EPS and Dividend Growth
Expect to Deliver Strong Long-Term EPS and Dividend Growth • Expect 2024 EPS in a range of $4.52 to $4.72 – Midpoint represents 6.2% EPS growth compared to 2023 original guidance midpoint of $4.35 Original EPS Guidance • Remain on track to deliver strong long-term earnings growth – Expect 6% to 8% E
Slide 11: Executing Our Strategy in 2024 and Beyond
Executing Our Strategy in 2024 and Beyond Investing in rate regulated energy infrastructure to benefit our customers, communities, shareholders and the environment • Expect ~8.2% rate base CAGR from 2023-2028; 2024-2028 capital plan of $21.9 billion – Includes renewables and simple-cycle gas generat
Slide 12: Investing in the Energy Grid
Investing in the Energy Grid • Investing to modernize energy grid, making it cleaner, safer, more reliable, resilient and secure – Ameren Missouri Smart Energy Plan filed with the MoPSC supporting infrastructure investment to 2023-2028E Regulated modernize the grid Infrastructure Rate Base – Expect
Slide 13: Ameren Missouri Solar Projects
Ameren Missouri Solar Projects Investing in rate regulated energy infrastructure to benefit our customers, communities, shareholders and the environment Huck Cass Bowling Boomtown2,3 Split Rail Vandalia Finn1,2 County3 Green Facility size 200-MW 150-MW 300-MW 150-MW 50-MW 50-MW Agreement Development
Slide 14: MISO Long-Range Transmission Planning Roadmap
MISO Long-Range Transmission Planning Roadmap Investing in rate regulated energy infrastructure to benefit our customers, communities, shareholders and the environment • In July 2022, MISO approved Tranche 1 projects of ~$10 billion – $1.8 billion1 assigned to Ameren; planning, design work and procu
Slide 15: Robust Investment Opportunities Across All Businesses Over Next Decade
Robust Investment Opportunities Across All Businesses Over Next Decade Modernizing the grid and investing in cleaner generation Investment Plan 2024-2028 $55B+ ($ billions) $21.9 Strong Pipeline of Regulated Infrastructure Investments $4.1 2024-2033 $1.8 • Modernize electric and gas transmission and
Slide 16: Focused on Disciplined Cost Management to Drive Affordability
Focused on Disciplined Cost Management to Drive Affordability Optimize operating performance to benefit our customers, shareholders and the environment • Track record of disciplined cost management – Target flat operations and maintenance expenses through 2028 • Maintaining focus on continuous impro
Slide 17: Our Value Proposition for Customers, Shareholders and the Environment
Our Value Proposition for Customers, Shareholders and the Environment Attractive dividend Strong long-term and long-term dividend growth Attractive total growth outlook outlook return potential • Expect 6% to 8% EPS CAGR 2024-20281 • Annualized equivalent dividend rate of • Track record of deliverin
Slide 18: Financial Update
Financial Update Michael Moehn Senior Executive Vice President and Chief Financial Officer, Ameren Corp.
Slide 19: 2023 Earnings Analysis Key Variance Drivers
2023 Earnings Analysis Key Variance Drivers1 ↑ Ameren Transmission earnings — Increased investments in infrastructure ↑ Ameren Illinois Electric Distribution earnings Diluted EPS1 — Increased investments in infrastructure; higher allowed ROE 2022 vs. 2023 ↑ Ameren Illinois Natural Gas earnings — Inc
Slide 20: Missouri Electric Regulatory Matters
Missouri Electric Regulatory Matters Securitization of Rush Island • On Sep. 30, 2023, District Court1 granted Ameren Missouri’s request Procedural Schedule to extend retirement date from Mar. 30, 2024 to Oct. 15, 2024 (Docket No.: EF-2024-0021) • On Nov. 21, 2023, filed for securitization of costs
Slide 21: Illinois Regulatory Matters
Illinois Regulatory Matters Natural Gas Distribution • On Nov. 16, 2023, ICC approved a $112 million annual base rate increase; includes $77 million that would otherwise be recovered in 2024 under riders – 2024 future test year – 9.44% allowed return on equity and 50% common equity ratio – $2.85 bil
Slide 22: Illinois Multi-Year Rate Plan
Illinois Multi-Year Rate Plan Electric Distribution ICC ORDER • On Dec. 14, 2023, ICC approved a cumulative increase of $142 million in revenues Key 2024 2025 2026 2027 versus Ameren Illinois’ request of $444 million Components – ICC rejected Multi-Year Grid Plan; Ameren Illinois must file revised G
Slide 23: Strategically Allocated Rate Base Growth
Strategically Allocated Rate Base Growth Increased five-year infrastructure investment plan by $2.2B1 $21.9 Billion of Regulated Infrastructure Investment 2023 to 2028E Regulated Five-Year Rate 2024-20284 Infrastructure Rate Base2,3,4 Base CAGR3,4 Ameren Illinois ($ billions) Ameren Illinois $36.4 E
Slide 24: Expected 2024-2028 Funding Plan
Expected 2024-2028 Funding Plan • Cash from Operations – ~$2 billion of income tax deferrals and tax asset utilization • Income tax deferrals primarily driven by capital expenditures • Includes utilization of ~$60 million of federal and state tax credit carryforwards at year- end 2023 • 15% corporat
Slide 25: 2024 Earnings Guidance: Key Drivers and Assumptions
2024 Earnings Guidance: Key Drivers and Assumptions Midpoint represents ~6% EPS growth compared to 2023 original guidance midpoint of $4.35 ↑ Higher investments in infrastructure eligible for PISA and AFUDC: ~+$0.18 ↑ New electric service rates effective July 9, 2023: ~+$0.08 2024 EPS Guidance ↑ Hig
Slide 26: 2024 Earnings Guidance: Key Drivers and Assumptions
2024 Earnings Guidance: Key Drivers and Assumptions Midpoint represents ~6% EPS growth compared to 2023 original guidance midpoint of $4.35 ↓ Lower allowed ROE of 8.72% compared to 9.9% in 2023 Ameren Illinois — 50 bps change in ROE impacts EPS by ~$0.04 annually1 2024 Electric — Rate base change of
Slide 27: Summary
Summary Expect to deliver strong earnings growth in 2024 with guidance in a range of $4.52 to $4.72 per diluted share Successfully executing our strategy; well-positioned for future growth • Focused on delivering a cleaner and sustainable energy future in a responsible manner Strong long-term growth
Slide 28: Appendix
APPENDIX
Slide 29: Four Regulatory Frameworks
Four Regulatory Frameworks FERC-regulated: Formula ratemaking Ameren • Allowed ROE is 10.52%, includes MISO participation adder of 50 basis points; ~56% average equity ratio Transmission • Rates reset each Jan. 1 based on forward-looking calculation with annual reconciliation ICC-regulated: Future t
Slide 30: Ameren Illinois Electric Distribution Multi-Year Rate Plan Performance Metrics
Ameren Illinois Electric Distribution Multi-Year Rate Plan Performance Metrics Adjustment / Metric Description Incentive (+/- bps) Improve System Average Interruption Duration Index (SAIDI) systemwide; improve interruption and 1. Reliability duration outages (SAIDI, SAIFI, CEMI, and CELID) in enviro
Slide 31: Federal Energy Legislation
Federal Energy Legislation • Inflation Reduction Act enacted in Aug. 2022 – Enhances affordability of the clean energy transition for customers in Missouri and Illinois • Ameren Missouri customers expected to save ~$1.6 billion by 2033, as result of wind and solar tax credits1 • Ameren Illinois cust
Slide 32: Ameren Missouri Smart Energy Plan
Ameren Missouri Smart Energy Plan filed with MoPSC on Feb. 23 Investing in rate regulated energy infrastructure to benefit our customers, shareholders and the environment • $1.7 billion invested in 2023 to support reliability, address aged infrastructure and provide clean energy to the customers and
Slide 33: 2024 Planned Capital Expenditures
2024 Planned Capital Expenditures 2024E Capital Expenditures $4,415M Ameren Illinois Ameren Illinois Electric Distribution Natural Gas $305M $485M 7% 11% Ameren Transmission Ameren $770M Missouri 17% Renewable Generation $1,030M 23% $1,485M $340M 34% 8% Ameren Ameren Missouri Missouri Dispatchable O
Slide 34: Missouri Integrated Resource Plan
Missouri Integrated Resource Plan filed with MoPSC Sept. 2023 Least-cost approach to reliably meet customer energy needs in an environmentally responsible manner • Carbon emissions1: Targets substantial reductions; 60% by 2030, 85% by 2040 and net-zero by 2045 • Coal: All energy centers retired by 2
Slide 35: Ameren Organizational Structure and External Debt Balances
Ameren Organizational Structure and External Debt Balances1 $ in millions as of Dec. 31, 2023 All Moody’s and S&P outlooks “Stable” Ameren Corporation (Baa1/BBB+) Sr. Unsecured (Baa1/BBB) - $3,850 Commercial Paper (P-2/A-2) - $0 Ameren Missouri Ameren Illinois ATXI (Baa1/BBB+) (A3/BBB+) (A2/-) Sr. S
Slide 36: Long-Term Debt Maturities and Interest Rates
Long-Term Debt Maturities and Interest Rates Issuer 20241 2025 2026 2027 2028 $350 million 3.65% senior unsecured notes $450 million 2.50% $500 million 1.95% $450 million 1.75% Ameren Corp. senior unsecured notes senior unsecured notes senior unsecured notes $600 million 5.70% senior unsecured notes
Slide 37: Ameren's Estimated Coal-Related Revenues in 2023
Ameren’s Estimated Coal-Related Revenues in 2023 Return on Investment Revenues Cost Recovery3 Revenues $1.97B1 x $1.97B1 x ($98M x $466M + 51.9%2 x 48.1% x 25%) / (1 $171M x $131M + 9.59%2 = 3.93% = - 25%) 17%1 = $265M = $98M $37M $33M $29M $862M $7,500M 14% Return on Interest Tax Expense Property F
Slide 38: GAAP to Core Earnings Per Share Reconciliations
GAAP to Core Earnings Per Share Reconciliations Year Ended Dec. 31, 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 GAAP Earnings / Diluted EPS $1.18 $2.40 $2.59 $2.68 $2.14 $3.32 $3.35 $3.50 $3.84 $4.14 $4.38 Exclude results from discontinued operations 0.87 — (0.01) — — — — — — — — Less: In
Slide 39: Weather-Normalized Earnings per Share Reconciliations
Weather-Normalized Earnings per Share Reconciliations Year Ended Dec. 31, 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Core1 Diluted EPS $2.10 $2.40 $2.56 $2.68 $2.83 $3.37 $3.35 $3.50 $3.84 $4.14 $4.38 Ameren Missouri weather impact included in margins 0.03 0.05 (0.04) 0.16 (0.07) 0.43 0.
Slide 40: Investor Relations Calendar
Investor Relations Calendar FEBRUARY / EARLY MARCH 2024 APRIL 2024 SUN. MON. TUES. WED. THUR. FRI. SAT. SUN. MON. TUES. WED. THUR. FRI. SAT. 28 29 1 2 1 2 3 4 5 6 UBS Round Robin 3 4 5 6 7 8 9 7 8 9 10 11 12 13 Morgan Q1 Quiet BofA Period Stanley Conf. Begins Conf. 14 15 16 17 18 19 20 10 11 12 13 1
Slide 41: Select Regulatory and Legislative Matters
Select Regulatory and Legislative Matters Missouri Public Service Commission • Right of First Refusal bill (HB1449 and SB805): https://house.mo.gov/ and https://www.senate.mo.gov/ • Special Ratemaking for new generation (HB2541 and SB1422) https://house.mo.gov/ and https://www.senate.mo.gov/ • Order
Slide 42: Glossary of Terms and Abbreviations
Glossary of Terms and Abbreviations AFUDC – Allowance for funds used during construction LRTP – Long Range Transmission Planning ATXI – Ameren Transmission Company of Illinois LT – Long-term B – Billion M – Million bps – Basis points MEEIA – Missouri Energy Efficiency Investment Act CAGR – Compound