Centerpoint Energy, Inc (holding Co) · NYSE:CNP
Centerpoint Energy, Inc (holding Co) — Q3 2016 Earnings Presentation
21 slides from Centerpoint Energy, Inc (holding Co)'s earnings presentation, Nov 4, 2016
Slide 1: 3rd Quarter 2016 Earnings Call
Third quarter 2016 earnings of $0.41 per diluted share Full year guidance updated to $1.16 - $1.20 Strong utility performance driven by customer growth and rate relief Midstream Investments expected to contribute earnings at the high end of the $0.24 - $0.28 guidance range for 2016 Company continues
Slide 2: Cautionary Statement
Cautionary Statement This presentation and the oral statements made in connection herewith contain statements concerning our expectations, beliefs, plans, objectives, goals, strategies, future operations, events, financial position, earnings, growth, costs, prospects, capital investments or performa
Slide 3: Earnings Call Highlights
Earnings Call Highlights Third Quarter Performance Enable Midstream Highlights Full-Year Outlook Scott Prochazka – President and CEO
Slide 4: Third Quarter 2016 Performance Highlights
Third Quarter 2016 Performance Highlights (1) Refer to slide 16 for reconciliation to GAAP measures and slide 2 for information on non-GAAP measures (2) Excluding ZENS and CES mark-to-market adjustments (3) Primarily related to true-up proceeds Q3 2016 vs Q3 2015 Drivers (2) h Favorable Variance i U
Slide 5: Highlights from Enable Midstream's Earnings Call on Nov. 2, 2016
Highlights from Enable Midstream’s Earnings Call on Nov. 2, 2016 Source: Enable Midstream Partners, November 2, 2016, Press Release and Q3 Earnings Call. Please refer to these materials for an overview of Enable’s Q3 performance (1) Per Drillinginfo: Q3-16 rig count of 33 rigs as of October 26, 2016
Slide 6: CenterPoint Energy Full-Year Outlook
CenterPoint Energy Full-Year Outlook Focus continues to be on investing in our utility service territories to address ongoing growth, maintenance, reliability, safety and customer service 2016 earnings from Utility Operations are expected to represent 75% - 80% of overall earnings Anticipate 2016 Ut
Slide 7: Earnings Call Highlights: Houston Electric
Earnings Call Highlights Houston Electric Results Houston Electric Regulatory Update Tracy Bridge – EVP & President, Electric Division Construction of a new 345kV double circuit tower
Slide 8: Electric Transmission and Distribution Operating Income Drivers
(1) Houston Electric’s customer count increased by 51,208 from 2,337,806 as of September 30, 2015 to 2,389,014 as of September 30, 2016 (2) Q3 2015 TDU core operating income represents total segment operating income of $244 million, excluding operating income from transition and system restoration b
Slide 9: Electric Transmission and Distribution Q3 2016 Regulatory Update
DCRF – Distribution Cost Recovery Factor; PUCT – Texas Public Utility Commission; TCOS – Transmission Cost of Service; EECRF – Energy Efficiency Cost Recovery Factor (1) Performance incentive approved and recognized in October 2015 was $6.6 million Mechanism Effective Date Annual DCRF Revenue Requir
Slide 10: Earnings Call Highlights: Natural Gas Distribution
2015 Minnesota Beltline Replacement Project in downtown Minneapolis Earnings Call Highlights Natural Gas Distribution Results Natural Gas Distribution Regulatory Update Energy Services Results Atmos Energy Marketing (AEM) Acquisition Joe McGoldrick – EVP & President, Gas Division
Slide 11: Natural Gas Distribution Operating Income Drivers
1% YoY Customer Growth (1) $ Millions Natural Gas Distribution Operating Income Drivers: Q3 2015 vs Q3 2016 (2) (1) Natural Gas Distribution’s customer count increased by 34,844 from 3,359,556 as of September 30, 2015 to 3,394,400 as of September 30, 2016 (2) Includes rate increases of $8 million an
Slide 12: Natural Gas Distribution Regulatory Update
GRIP – Gas Reliability Infrastructure Program; APSC – Arkansas Public Service Commission; RRA – Rate Regulation Adjustment; MPSC – Mississippi Public Service Commission; MPUC – Minnesota Public Utilities Commission Jurisdictions Effective Date Annual Increase ($MM) Comments Docket # Houston South Te
Slide 13: Natural Gas Distribution Q3 2016 Regulatory Update
MPUC – Minnesota Public Utilities Commission; CIP – Conservation Improvement Program; RSP – Rate Stabilization Plan; BDA – Billing Determinant Rate Adjustment (1) Performance incentive approved in 2015 was $11.6 million; recognized in August 2015 (2) Interim rates begin the recognition of revenue, s
Slide 14: Energy Services: Third Quarter Operating Income and AEM Acquisition
Third Quarter Operating Income Operating income was $7 million for the third quarter 2016 compared to $2 million for the same period last year, excluding a mark-to-market loss of $2 million and a gain of $5 million, respectively Energy Services Agreement to acquire Atmos Energy Marketing (AEM) Aggre
Slide 15: Earnings Call Highlights: Financing, Interest Expense & Tax
Bill Rogers – EVP & CFO Earnings Call Highlights Third Quarter Earnings Financing, Interest Expense & Tax Strategic Review Update
Slide 16: Reconciliation: Net Income and Diluted EPS to Adjusted
Note: Refer to slide 2 for information on non-GAAP measures Reconciliation: Net Income (Loss) and Diluted EPS to Adjusted Net Income and Adjusted Diluted EPS Used in Providing Annual Earnings Guidance Net Income (in millions) Diluted EPS Net Income (in millions) Diluted EPS Consolidated as reported
Slide 17: Financing, Interest Expense and Tax
Liquidity and Capital Resources Anticipate strong balance sheet and cash flow Net incremental borrowings of ~$100 million expected for 2016, inclusive of funding for the acquisition of the retail energy services business and natural gas wholesale assets of Continuum Equity issuance not anticipated i
Slide 18: Enable Strategic Review Update
Enable Strategic Review Update Criteria for Consideration of a Sale or Spin – sustainable value for our long-term shareholders Comparable earnings per share and dividends Improve visibility and certainty of future earnings Seek to maintain current credit ratings Ongoing Activities Continuing discuss
Slide 19: Appendix
Appendix
Slide 20: Reconciliation: Operating Income to Core Operating Income
Reconciliation: Operating Income to Core Operating Income on a Guidance (Non-GAAP) Basis Operating Income ($ in millions) Quarter Ended September 30, 2016 Quarter Ended September 30, 2015 Difference Fav/(Unfav) Electric Transmission and Distribution 257 $ 244 $ 13 $ Transition and System Restoration
Slide 21: Reconciliation: Net Income and Diluted EPS to Adjusted (2015)
Note: Refer to slide 2 for information on non-GAAP measures Reconciliation: Net Income (Loss) and Diluted EPS to Adjusted Net Income and Adjusted Diluted EPS Used in Providing Annual Earnings Guidance Net Income (in millions) Diluted EPS Consolidated as reported (692) $ (1.61) $ Midstream Investment