Progress Energy — Merger or Acquisition (May 2011)
14 slides from Progress Energy's merger presentation, May 18, 2011
Slide 1: Financial Update: Investor Perspective on the Merger
Duke Energy- Financial Update Investor Perspective on the Merger Lynn J. Good Group Executive and Chief Financial Officer
Slide 2: Safe Harbor Statement
SAFE HARBOR SAFE HARBOR STATEMENT ‘This document contains forward-looking statements within the meaning ofthe Private Securities Litgation Reform Act of 1995. Forward-ooking statements are typically identified by words or phrases such as “may,” ‘wil “should,” “anticipate” “estimate,” ‘expect, “proje
Slide 3: Safe Harbor (Cont'd)
SAFE HARBOR (CONT’D) REG G DISCLOSURE In addition, today’s discussion includes certain non-GAAP financial measures as defined under SEC Regulation G. A reconclaton of those measures to the mast directly comparable ‘GAAP measures is available on our Investor Retations website at www.duke-energy.com/n
Slide 4: Strategic Combination Between Duke Energy and Progress Energy
Strategic Combination Between Duke Energy and Progress Energy =Creates largest U.S. utility Strategic = Substantial, diversified regulated business Benefits mix =Unmatched financial and operational scale =Long-term earnings growth target of 4-6 Investor percent! Benefits «Earnings accretive in year
Slide 5: Predominantly Regulated Earnings Base and Cash Flows
Predominantly Regulated Earnings Base and Cash Flows Regulated EBIT contribution of the combined operations will be approximately 87% @ Duke Energy is committed to growing its strong regulated earnings base Business M Duke Energy Progress Energy Combined Commercial Commercial Pawer Regulated Power ~
Slide 6: Balancing Expectations of Investors
Balancing Expectations of Investors Dividends Equity Investors Cost of Fixed Income Capital Investors Balance cheat Earnings growth strength PE
Slide 7: Attractive Dividend Policy
Attractive Dividend Policy Duke Energy dividend policy to be maintained Continued growth in dividend at a rate slower than growth of adjusted diluted EPS Targeting a long-term payout range of 65% to 70% of adjusted diluted EPS Attractive payout and yield underscores compelling shareholder value prop
Slide 8: 2011 Earnings Outlook
2011 Earnings Outlook 2011 Adjusted Diluted EPS Outlook Range $1.35 — $1.40 6% EPS CAGR ) wear (nt of rents sovetase)_| 4% EPS CAGR $1.30 5 $1.20 5 $1.10 2009A 2010A 2011E Pettey.
Slide 9: Attractive Rate Base Growth
Attractive Rate Base Growth Projected Capital Expenditures ($ B) Projected Rate Base ($ B) Wi Regulated Maintenance Regulated Growth MiProgress Energy Ml Duke Energy Non-Regulated iscretionary Range $49 $46 $8 4 Illustrative $3 2010E 2011E 2012E 2010E QUE 2012E 2013E 2014E Note: Forecasted capital e
Slide 10: Strong Credit Quality and Liquidity
Strong Credit Quality and Liquidity = Highly committed to Duke Energy's current strong credit ratings = Lower overall risk profile resulting from increased regulated earings base and cash flows = Strong balance sheet strength with $92 B in total assets! = Increased regulatory diversity with presence
Slide 11: Merger Reaction From Wall Street
Merger Reaction From Wall Street = Overall, merger has been well-received = — Strategic logic is compelling = Improves risk profile (higher regulated business mix) = Provides diversification (regulatory, generation mix, etc) = Provides fuel and joint dispatch savings to customers = Earnings accretiv
Slide 12: Shareholder Value Track Record
Shareholder Value Track Record 1 year 5 year (15.4%) Duke Progress Duke Progress | sapso0 UTY
Slide 13: Status of Merger Filings (As of May 18, 2011)
Status of Merger Filings (As of May 18, 2011) Progress on Key Milestones * Filed intial $-4 for SEC review on March 17, 2011; On April 8, 2011, ‘April 25, 2011 and May 13, 2011, filed amendments to S-4 Stakeholder Filed Approved = Shareholder meetings in 20/30 2011 Ol Depa = The partes have met thei
Slide 14: Duke Energy
5 Duke Energy: HR Web Cast — Page 14 a! |