Nextera Energy, Inc. · NYSE:NEE
Nextera Energy — Q2 2013 Earnings Presentation
32 slides from Nextera Energy's earnings presentation, Jul 30, 2013
Slide 1: Earnings Conference Call Second Quarter 2013
Earnings Conference Call Second Quarter 2013 July 30, 2013
Slide 2: Cautionary Statements And Risk Factors That May Affect Future Results
Cautionary Statements And Risk Factors That May Affect Future Results Any statements made herein about future operating and/or financial results and/or other future events are forward-looking statements under the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These f
Slide 3: NextEra Energy had a very successful second quarter
NextEra Energy had a very successful second quarter NextEra Energy Overview • At FPL: – Maintained a regulatory ROE of 11% – Growth in regulatory capital employed drove net income growth of ~11% – Cape Canaveral entered service ahead of schedule on April 24 – Riviera Beach and Port Everglades modern
Slide 4: FPL delivered solid earnings growth during the quarter due to investments that benefit customers
FPL delivered solid earnings growth during the quarter due to investments that benefit customers Florida Power & Light Results – Second Quarter Net Income EPS ($ MM) $0.92 $391 $0.85 $353 2012 2013 2012 2013 4
Slide 5: FPL's earnings per share grew 7 cents quarter-over-quarter
FPL’s earnings per share grew 7 cents quarter-over-quarter, driven primarily by continued investment in the business Florida Power & Light EPS Contribution Drivers EPS Growth Regulatory Capital Invested(1) Second Quarter $B FPL – 2012 EPS $0.85 $30.0 $27.6 $25.0 $24.7 Drivers: $20.0 New investment g
Slide 6: Florida's economy continues to improve
Florida’s economy continues to improve Florida Economy Change from PY (%) Housing Starts(1) Florida Building Permits(2) 100% 12,000 FL 80% U.S. 10,000 Index 60% 40% 8,000 20% 6,000 0% -20% 4,000 -40% 2,000 -60% -80% 0 Jul-04 Jul-06 Jul-08 Jul-10 Jul-12 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-1
Slide 7: FPL's customer metrics continued to improve in the second quarter
FPL’s customer metrics continued to improve in the second quarter Customer Characteristics – Second Quarter 2013 Retail kWh Sales Customer Growth(1) (Change vs. prior-year quarter) (Change vs. prior-year quarter) Customer Growth 0.8% 100 80 + Usage Growth Due to Weather -0.6% # of Customers 60 + Und
Slide 8: FPL has completed its analysis of natural gas pipeline options
FPL has completed its analysis of natural gas pipeline options Natural Gas Pipeline Investment • Best economic solution for customers – Sabal Trail Transmission (Spectra Energy): – ~465 miles to Central Florida Hub – Estimated capital cost of ~$3 B – Plus: Florida Southeast Connection (NextEra Energ
Slide 9: Energy Resources' adjusted earnings per share increased ~37% versus Q2 2012
Energy Resources’ adjusted earnings per share increased ~37% versus Q2 2012 Energy Resources Results(1) – Second Quarter GAAP Adjusted Net Income EPS Net Income EPS ($ MM) ($ MM) $251 $0.60 $238 $229 $0.54 $0.56 $173 $0.41 $229 $0.54 2012 2013 2012 2013 2012 2013 2012 2013 9 (1) See Appendix for rec
Slide 10: Energy Resources' contribution to adjusted EPS increased 15 cents
Energy Resources’ contribution to adjusted earnings per share increased 15 cents over the comparable quarter primarily due to new asset additions Energy Resources Second Quarter Adjusted EPS(1) Contribution Drivers $0.60 $0.02 ($0.03) $0.04 $0.56 $0.12 $0.41 $0.42 $0.40 $0.20 $0.00 Q2 2012 New Exist
Slide 11: Energy Resources continued accessing diverse funding sources that preserve corporate credit
Energy Resources continued accessing diverse funding sources that preserve corporate credit Energy Resources Financings • Completed differential membership interest transaction – ~160 MW of contracted wind – $170 MM in proceeds • Completed Term Loan B financing on Texas gas-fired plants – Largest pr
Slide 12: NextEra Energy's adjusted earnings per share increased 20 cents
NextEra Energy’s adjusted earnings per share increased 20 cents versus the prior year comparable quarter NextEra Energy EPS Summary(1) – Second Quarter GAAP 2012 2013 Change FPL $0.85 $0.92 $0.07 Energy Resources $0.60 $0.54 ($0.06) Corporate and Other $0.00 ($0.02) ($0.02) Total $1.45 $1.44 ($0.01)
Slide 13: We are moving forward on a number of incremental investments
We are moving forward on a number of incremental investments Incremental Capital Opportunities Opportunity Status FPL Filed plan with PSC to invest additional • Storm hardening ~$400 MM in 2013-2016 Infrastructure improvements of ~$700 MM in • Reliability investment 2013-2016 Submitted clause recove
Slide 14: NextEra Energy Adjusted Earnings Per Share Expectations
NextEra Energy Adjusted Earnings Per Share Expectations 2013 Upper half of $4.70 - $5.00 Long-term 5% to 7% CAGR growth rate through 2016 off of a 2012 base 14
Slide 15: Focus for 2013
Focus for 2013 • NEE – Maintain excellence in day-to-day operations – Execute on productivity improvement opportunities to further improve cost position • FPL – Maintain leading customer value proposition – Continue successful execution on large construction projects – Execute on new initiatives • E
Slide 16: Q&A Session
16 Q&A Session NeExTera’ ENERGY
Slide 17: NEX Tera
NEX Tera ENERGY &
Slide 18: Appendix
18 Appendix NeExTera’ ENERGY
Slide 19: NextEra Energy Resources 2013 Portfolio Financial Information
NextEra Energy Resources 2013 Portfolio Financial Information (as of June 7, 2013) Equivalent Equivalent Equivalent 1 Expected Gross Margin % Gross EBITDA1 Remaining2 Following3 Generation Range Margin Range Contract Year PTC MWs Twh's $ in millions Hedged $ in millions Life Expiration Contracted Wi
Slide 20: Energy Resources' existing assets are largely contracted or hedged for 2013
Energy Resources’ existing assets are largely contracted or hedged for 2013 2013 Equivalent Gross 2013 Balance of Year Margin Contributions(1) Portfolio Sensitivities 4% New Investment(2) • $1/MMBtu change in natural gas ≈ 2 cents in 12% Other (3) adjusted EPS(5) 58% 26% Contracted Merchant Assets(4
Slide 21: NextEra Energy Resources 2014 Portfolio Financial Information
NextEra Energy Resources 2014 Portfolio Financial Information (as of June 7, 2013) Equivalent Equivalent Equivalent 1 1 2 3 Expected Gross Margin % Gross EBITDA Remaining Following Generation Range Margin Range Contract Year PTC MWs Twh's $ in millions Hedged $ in millions Life Expiration Contracted
Slide 22: Energy Resources' existing assets are largely contracted or hedged for 2014
Energy Resources’ existing assets are largely contracted or hedged for 2014 2014 Equivalent Gross Margin Contributions(1) 2014 Portfolio Sensitivities • $1/MMBtu change in 11% New natural gas ≈ 4 cents in Investment(2) adjusted EPS(5) 13% Other (3) 52% Contracted Assets(4) (97% hedged) 24% Merchant
Slide 23: Wind Production Index
Wind Production Index(1)(2) 110% 108% Long-Term Average 106% 105% 105% 105% 102% 101% 100% 97% 95% 95% 93% 90% 85% Jan-13 Feb-13 Mar-13 Q1 Apr-13 May-13 Jun-13 Q2 YTD A 1% change in the wind production index equates to roughly 1.5 cents of EPS for the remainder of 2013 and roughly 3 cents of EPS for
Slide 24: Market risk will be mitigated by our significantly hedged position
Market risk will be mitigated by our significantly hedged position over the next several years Energy Resources Equivalent Gross Margin Contracted or Hedged(1) 98% 100% 100% 100% 100% 100% 95% 92% 87% 80% 60% 40% 20% 0% 2013 2014 2015 2016 Existing New (1) Projected equivalent gross margin includes
Slide 25: Non-Qualifying Hedges – Summary of Activity
Non-Qualifying Hedges(1) – Summary of Activity ($ millions, after-tax) Asset/(Liability) Balance as of 3/31/13 $347.2 Amounts Realized During 2nd Quarter (20.9) Primary Drivers: Revenue Hedges – Gas Change in Forward Prices (all positions) 13.2 & Power Prices $43.4 Subtotal – Income Statement (7.7)
Slide 26: Non-Qualifying Hedges – Summary of Activity
Non-Qualifying Hedges(1) – Summary of Activity ($ millions, after-tax) 1st Quarter 2nd Quarter Asset / Deals Asset / Deals Asset / (Liability) Change in Executed Total (Liability) Change in Executed Total (Liability) Balance Amounts Forward During Unrealized Balance Amounts Forward During Unrealized
Slide 27: Non-Qualifying Hedges – Summary of Forward Maturity
Non-Qualifying Hedges(1) – Summary of Forward Maturity ($ millions, after-tax) Gain / (Loss) (2) Asset / (Liability) Balance Total Description 6/30/13 2013 2014 2015 2016 2017 - 2032 2013 - 2032 Natural gas related positions $ 435.8 $ (54.1) $ (93.7) $ (87.8) $ (85.1) $ (115.1) $ (435.8) Spark sprea
Slide 28: Reconciliation of Adjusted Earnings to GAAP Net Income
Reconciliation of Adjusted Earnings to GAAP Net Income (Three Months Ended June 30, 2012) Florida Pow er Energy Corporate & NextEra Energy, (m illions, except per share am ounts) & Light Resources Other Inc. Net Income (Loss) $ 353 $ 251 $ 3 $ 607 Adjustments, net of income taxes: Net unrealized mar
Slide 29: Reconciliation of Adjusted Earnings to GAAP Net Income
Reconciliation of Adjusted Earnings to GAAP Net Income (Three Months Ended June 30, 2013) Florida Power Energy Corporate & (millions, except per share amounts) & Light Resources Other NextEra Energy, Inc. Net Income (Loss) $ 391 $ 229 $ (10) $ 610 Adjustments, net of income taxes: Net unrealized mar
Slide 30: Cautionary Statement And Risk Factors That May Affect Future Results
Cautionary Statement And Risk Factors That May Affect Future Results This presentation contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not statements of historical facts, bu
Slide 31: Cautionary Statement And Risk Factors That May Affect Future Results (cont.)
Cautionary Statement And Risk Factors That May Affect Future Results (cont.) failure or breach of NextEra Energy's and FPL's information technology systems; risks to NextEra Energy and FPL's retail businesses of compromise of sensitive customer data; risks to NextEra Energy and FPL of volatility in
Slide 32: NEX Tera
NEX Tera ENERGY &