Txnm Energy, Inc. · NYSE:TXNM

Txnm Energy — PNM Resources — Investor Presentation (December 2011)

17 slides from Txnm Energy's investor presentation, December 2011

  1. Slide 1: PNM Resources Overview

    PNM Resources Overview December 2011

  2. Slide 2: Safe Harbor Statement

    Safe Harbor Statement Statements made in this news release that relate to future events or PNM Resources’, Public Service Company of New Mexico’s (“PNM”), or Texas-New Mexico Power Company’s (“TNMP”) (collectively, the “Company”) expectations, projections, estimates, intentions, goals, targets, and

  3. Slide 3: Company Overview

    Company Overview

  4. Slide 4: Repositioning as Strong Regulated Utility

    New Strategic Direction Repositioning as Strong Regulated Utility Strategic Goals Earn Authorized Return on our Regulated Businesses Exit Hybrid Regulated Return to Solid Competitive Utility Utility Investment Grade Business Ratings Provide an attractive total return proposition to our shareholders

  5. Slide 5: PNM Resources Overview

    PNM Resources Overview Focus:  Earn our allowed returns  Achieve solid investment grade credit ratings  Located in New Mexico  503,700 customers  Provide stable long-term earnings and dividend growth  14,529 miles transmission and distribution lines New Mexico and Texas  2,543MW generation ca

  6. Slide 6: PNM: Recent Accomplishments

    PNM: Recent Accomplishments  Significant progress has 2008 been made to improve 6% base rate increase PNM’s financial health $33M rate increase Temporary fuel clause • Three rate increases in the past four years • Exited gas operations, 2009 8% base rate increase used 100% of the Permanent Merchant

  7. Slide 7: Electric Affordability by State

    Electric Affordability by State 4.0% 3.5% 3.0% Est. 2012 Median Household Income 2.5% US Average Average 2012 Est. Electric Bill 2.0% 1.5% 1.0% 0.5% 0.0% AR WA IL WI MO HI AL FL WY CA SD VA PNM-South NV CT VT SC TN CO OK WV GA MN NH RI AK MA DC NC AZ LA ID KS OR NJ ND IN PA TX MD MS UT PNM-North NE

  8. Slide 8: PNM: Pathway to Continued Success

    PNM: Pathway to Continued Success  Earn allowed return • Synchronize revenues and expenses • Balance future rate increases for customers while ensuring the appropriate return is earned for our shareholders  Continue to get positive regulatory outcomes  Continue to strengthen investment grade cred

  9. Slide 9: NM Regulatory Environment

    NM Regulatory Environment  NM recognized as a challenging regulatory framework  Current effort in the state to reform the New Mexico Public Regulation Commission (NMPRC) • An independent results-oriented advocacy group • Has demonstrated success through several policy changes • Advocating legislat

  10. Slide 10: TNMP: Recent Accomplishments

    TNMP: Recent Accomplishments  Restored earnings potential 2009 working with a constructive 7% rate increase General rate case Texas regulatory framework $13M rate increase • Achieved successful outcomes in four cases over 2010 the past three years 4% base rate increase • On track to achieve its TCO

  11. Slide 11: TNMP: Pathway to Continued Success

    TNMP: Pathway to Continued Success  Continue to earn allowed rate of return  Use transmission cost of service filings to • Reduce regulatory lag • Grow rate base  Employ distribution cost of service filings, when available  Retain solid credit metrics  Invest in the business 11

  12. Slide 12: Financial Direction

    Financial Direction

  13. Slide 13: Exit of Competitive Business

    Exit of Competitive Business  Strengthens PNM Resources’ financial position  Eliminates financial and business risks associated with competitive entities  Focuses strategic direction on regulated utilities Recapitalized the business after competitive business exit Equity – repurchased $73.5M 4.8M

  14. Slide 14: Recent Credit Rating Accomplishments

    Recent Credit Rating Accomplishments  Utilities at investment grade  Strength, stability and predictability recognized  Ratings upgraded Sept. 26 and Nov. 1 Moody’s S&P PNMR PNM TNMP PNMR PNM TNMP Debt rating Ba1(1) Baa3(1) A3(2) Debt rating BB (1) BBB- (1) BBB (2) Outlook Stable Stable Stable Ou

  15. Slide 15: Liquidity/Dividend

    Liquidity/Dividend  Recently refinanced PNMR and PNM revolvers ($700M)  Targeting cap structure of • 50/50 at PNM • 55/45 at TNMP  Dividend will be reviewed by the Board in February PNMR PNM TNMP Total Available liquidity as of Nov. 1, 2011 Total Capacity $305 $400 $75 $780 Less LCs (1) (70) (2)

  16. Slide 16: Key Strategic Goals and Checklist

    Key Strategic Goals and Checklist Earn Authorized Return on Our Maximize the Value of Our Regulated Businesses Competitive Businesses  Achieve successful outcomes in:  Maintain profitability of First Choice Power by  PNM retail rate case achieving customer growth and increasing  Achieved by mone

  17. Slide 17: Questions and Answers

    Questions and Answers

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