Duke Energy Corporation (holding Company) · NYSE:DUK

Duke Energy Corporation (holding Company) — Q4 2011 Earnings Presentation

72 slides from Duke Energy Corporation (holding Company)'s earnings presentation, Feb 16, 2012

1. Slide 1: Fourth Quarter and Year-End 2011 Earnings Review and Business Update

   FOURTH QUARTER AND YEAR-END 2011 Earnings Review and Business Update February 16, 2012 Jim Rogers Chairman, President and Chief Executive Officer Lynn Good Group Executive and Chief Financial Officer

2. Slide 2: Safe Harbor

   SAFE HARBOR SAFE HARBOR STATEMENT This document includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are based on management's beliefs and assumptions. These forward-look

3. 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 reconciliation of those measures to the most directly comparable GAAP measures is available on our Investor Relations website at www.duke-energy.com

4. Slide 4: Topics for Today's Call

   TOPICS FOR TODAY’S CALL 2011 In Review and 2012 Earnings Guidance 4Q 2011 Earnings Summary and Financial Update 2012 Earnings Guidance Support Update on Strategic Initiatives  Progress Energy merger  Major construction projects  Carolinas rate cases Shareholder Value Track-Record Key Priori

5. Slide 5: 2011 in Review and 2012 Earnings Guidance

   2011 IN REVIEW AND 2012 EARNINGS GUIDANCE Our Accomplishments 2012 Adjusted Diluted EPS Outlook Range  Financial  Exceeded original adjusted diluted EPS outlook range of $1.35-1.40 $1.40 – $1.45  Increased quarterly dividend by $0.005 to $0.25 per share 6% EPS CAGR  Issued $2.5 billion of fixed-

6. Slide 6: 4Q 2011 Earnings Summary and Drivers

   4Q 2011 EARNINGS SUMMARY AND DRIVERS Adjusted Diluted EPS Adjusted Segment EBIT 2011 2010 (in millions) Actual Actual US Franchised Electric and Gas $ 2,826 $ 2,966 Commercial Power 305 398 International 679 486 $1.43 $1.46 Total Business Segments $ 3,810 $ 3,850 Other (193) (278) $0.21 $0.24 Total

7. Slide 7: Economic Outlook

   ECONOMIC OUTLOOK  2011 weather-normalized load growth softer than expected due to challenging economy  Industrial load continues to be led by automotive sector  Residential and commercial classes remain weak Industrial  Economic29% Development Activities  Over 13,000 jobs and capital investment

8. Slide 8: Duke Energy – 2012 Adjusted Earnings Drivers

   DUKE ENERGY – 2012 ADJUSTED EARNINGS DRIVERS USFE&G +$0.12 Commercial Power ($0.08) Int’l ($0.04) Other ($0.03) $0.06 $0.17 $0.06 $0.05 ▼ AFUDC and $0.06 interest expense ▼D&A $0.11 $0.03 ▼ Weather $0.03 $0.05 $0.04 $0.03 $1.46 ▲ Carolinas Rates $0.02 ▼ Peru $0.03 ▲ Riders and $0.01 arbitration, $1.

9. Slide 9: Duke's Capital Expenditures Profile 2012-2014

   DUKE’S CAPITAL EXPENDITURES PROFILE 2012-2014 ($ in millions) $4,300 - $4,500 $3,850 – $4,500 $200 $3,550 – $3,950 $650 $900 $400 $325 Duke Energy $350 Discretionary Commercial Businesses & Other $3,400 $3,525 $3,200 USFE&G 2012 2013 2014 U.S. FE&G 6% 13% 9% 16% 23% Maintenance & Other 12% 11% 47% S

10. Slide 10: Regulated Rate Base Growth

    REGULATED RATE BASE GROWTH Projected Year-End Rate Base – USFE&G ($ in billions) $28.5 $29.6 $27.5 Projected Rate Base = $24.7 $2.6 $2.8 $2.4 Prior Period Rate Base $2.3 $7.7* $7.4* $7.6* $7.1 Add: Capital Expenditures Less: Depreciation & Amortization $16.9 $17.5 $18.2 $14.5 Less: Deferred Income T

11. Slide 11: 2012 Summary Cash Flows/Financing Plan

    2012 SUMMARY CASH FLOWS/FINANCING PLAN ($ in Millions) 2012E Primary Sources: Adjusted Net Income (1) $ 1,905 Expected 2012 Financing Plan Depreciation & Amortization 2,115 Deferred and Accrued Taxes 1,125 Estimated Debt Debt ($ in Millions) (3) (4) Other Sources / (Uses), net (2) (215) Issuances Ma

12. Slide 12: Long-Term Earnings Growth Drivers

    LONG-TERM EARNINGS GROWTH DRIVERS Adjusted Long-Term Earnings Growth Primary Earnings Growth Drivers REGULATED BUSINESSES Includes weather Includes weather 6% EPS CAGR $1.50 impact (net of impact of $0.05  Investments in rate base incentives above target) of $0.13  Fleet and grid modernization $1.

13. Slide 13: Status of Merger Filings

    STATUS OF MERGER FILINGS (As of February 16, 2012) Stakeholder Progress on Key Milestones Filed Approved  Received shareholder approvals on August 23, 2011 Shareholder    To date, the parties have met their obligations under the Hart-Scott-Rodino Act (HSR) Department of Justice  The period for

14. Slide 14: Status of Major Construction Projects

    STATUS OF MAJOR CONSTRUCTION PROJECTS (As of Dec. 31, 2011) Edwardsport – Indiana 97% Complete USFE&G Major Construction Projects1 • 618 MW IGCC facility $225 • Expected in-service by Fall 2012 • First fire of gas turbines expected during 1Q 2012 $175 • Cost increase pending before the IURC $3,075 C

15. Slide 15: Recovery of Duke Energy Carolinas Modernization Investments

    RECOVERY OF DUKE ENERGY CAROLINAS MODERNIZATION INVESTMENTS North Carolina Rate Case Overview Original Final Rate Rate Case Drivers Request Approval North Carolina Retail revenue increase (after cash ~$646 MM ~$309 MM mitigation) 15% Rate base (1) $11.2 B $10.7 B (2) 11% Return on equity (ROE) 11.5%

16. Slide 16: Shareholder Value Track Record

    SHAREHOLDER VALUE TRACK RECORD Cumulative Total Shareholder Return (%) 1 year 3 year 5 year 74.1% 48.6% 48.7% 38.7% 30.3% 19.3% 20.1% 2.1% (1.2%) Duke Duke Duke S&P 500 UTY(1) Energy S&P 500 UTY(1) Energy S&P 500 UTY(1) Energy Duke offers an attractive dividend yield of 4.8% (1) Philadelphia Utility

17. Slide 17: Key Priorities

    KEY PRIORITIES Shorter-Term (2012) Longer-Term (2012+) • Seek regulatory approvals related to the • Achieve 4% to 6% long-term adjusted diluted pending merger with Progress Energy EPS growth • Complete the remaining major capital • Maintain strength of balance sheet and credit projects ratings • Obt

18. Slide 18: Appendix Materials

    APPENDIX MATERIALS Item Slides 2011 Segment Results 19-28 2012 Guidance Support 29-35 Regulatory Overview 36-40 Environmental Overview 41-45 Non-Regulated Businesses 46-53 Financial Overview 54-59 Fourth Quarter and Year End Earnings Review and Business Update February 16, 2012 18

19. Slide 19: 2011 Segment Results

    2011 SEGMENT RESULTS Fourth Quarter and Year End Earnings Review and Business Update February 16, 2012 19

20. Slide 20: 4Q 2011 Earnings Summary and Drivers

    4Q 2011 EARNINGS SUMMARY AND DRIVERS 4Q11 4Q10 USFE&G Adjusted Segment EBIT Drivers – 4Q11 Adjusted Segment EBIT (in millions) ▼ Unfavorable weather – ($114) US Franchised Electric and Gas $ 552 $ 605 ▼ Increased O&M costs – ($10M) ▲ Favorable energy efficiency regulatory ruling in NC – $59M Commerc

21. Slide 21: US Franchised Electric and Gas

    US FRANCHISED ELECTRIC AND GAS Reported & Adjusted Segment EBIT Full Year Full Year 4Q11 4Q10 ($ in Millions) 2011 2010 Reported Segment EBIT $ 552 $ 605 $2,604 $2,966 Adjustments -- -- 222 -- Adjusted Segment EBIT $ 552 $ 605 $2,826 $2,966 Year-Over-Year Drivers Adjusted segment EBIT decreased prim

22. Slide 22: Industrial Volume Quarterly Trends

    INDUSTRIAL VOLUME QUARTERLY TRENDS Primary Metals Textiles Billed GwH Billed GwH 2,000 1,500 1,500 1,000 1,000 08 08 08 08 08 10 11 10 11 08 09 10 11 500 09 10 11 09 10 11 08 09 10 11 500 09 09 08 09 10 11 09 10 11 - - Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Chemicals Total Industrial Billed GwH Billed GwH 1,500 12

23. Slide 23: Maintain Focus on Operational Performance

    MAINTAIN FOCUS ON OPERATIONAL PERFORMANCE Nuclear Generation Capacity Factor Fossil Generation Commercial Availability 100% 100% 90% 90% 80% 80% 70% 70% 1Q11 2Q11 3Q11 4Q11 1Q11 2Q11 3Q11 4Q11 2011 Year-End Target Actual 2011 Year-End Target Actual Nuclear Total Operating Cost – $/MWh Total Fossil P

24. Slide 24: Duke Energy Ohio Competitive Auction Schedule

    DUKE ENERGY OHIO COMPETITIVE AUCTION SCHEDULE* Delivery Period Begins # Tranches to Auction Date Contract Duration Procure Jan 2012 June 2013 June 2014  17 Months 33 33 Dec-11  29 Months 33 33 33  41 Months 34 34 34 34 May-12 12 Months 17 17 17 Nov-12 12 Months 16 16 16 May-12 12 Months 17 17 Nov

25. Slide 25: USFE&G Quarterly Weather Impacts

    USFE&G QUARTERLY WEATHER IMPACTS ($ in Millions) Weather EBIT to Normal: 2011 2010 First Quarter $ -- $ 60 Second Quarter $ 50 $ 80 Third Quarter $ 80 $120 Fourth Quarter ($ 40) $ 60 Year-to-Date $ 90 $320 Note: Favorable/(Unfavorable) Key Weather Data (4Q2011) ►Cooling Degree Days Carolinas – 10 (7

26. Slide 26: Commercial Power

    COMMERCIAL POWER Reported & Adjusted Segment EBIT Full Year Full Year 4Q11 4Q10 ($ in Millions) 2011 2010 Reported Segment EBIT $ 8 $ 58 $ 225 $ (229) Adjustments (2) (4) 80 627 Adjusted Segment EBIT $ 6 $ 54 $ 305 $ 398 Year-Over-Year Drivers Commercial Power Adjusted Adjusted segment EBIT decrease

27. Slide 27: International

    INTERNATIONAL Reported & Adjusted Segment EBIT Full Year Full Year 4Q11 4Q10 ($ in Millions) 2011 2010 Reported Segment EBIT $ 152 $ 110 $ 679 $ 486 Adjustments -- -- -- -- Adjusted Segment EBIT $ 152 $ 110 $ 679 $ 486 International Adjusted Segment (in millions) Year-Over-Year Drivers EBIT Adjusted

28. Slide 28: Other

    OTHER Reported & Adjusted Net Expense Full Year Full Year 4Q11 4Q10 ($ in Millions) 2011 2010 Reported Net Expense $ 85 $ (113) $ 261 $ 255 Adjustments (39) 234 (68) 23 Adjusted Net Expense $ 46 $ 121 $ 193 $ 278 Other Adjusted Net Expense Year-Over-Year Drivers (in millions) Adjusted Net Expense de

29. Slide 29: 2012 Guidance Support

    2012 GUIDANCE SUPPORT Fourth Quarter and Year End Earnings Review and Business Update February 16, 2012 29

30. Slide 30: Business Segment Structure

    BUSINESS SEGMENT STRUCTURE DUKE ENERGY U.S. FRANCHISED ELECTRIC AND COMMERCIAL POWER INTERNATIONAL GAS Duke Energy North and South Duke Energy Carolina Renewables Carolinas Duke Energy Indiana Duke Energy Retail (DER) Indiana Ohio T&D Midwest Coal Generation Duke Energy Ohio Ohio Gas Midwest Gas Dis

31. Slide 31: Key Assumptions for 2012 Earnings Guidance Range

    KEY ASSUMPTIONS FOR 2012 EARNINGS GUIDANCE RANGE ($ in Millions) 2011 2012 MEMO: 2012 Interest MEMO: 2012 Adj. Actual Assumptions Expense, Net Effective Tax Rate Adjusted Segment Net Income: USFE&G $1,317 $1,485 $620 35% Commercial Power $185 $80 $70 (23%) (3) International $466 $410 $70 29% Other (

32. Slide 32: Capital Expenditure Profile

    CAPITAL EXPENDITURE PROFILE ($ in Millions) 2011A 2012E 2013E 2014E 2012-2014 Total Edwardsport IGCC 700 150 - - $ 150 Cliffside 250 150 - - 150 CC / CT Additions 400 200 75 225 500 Grid Modernization 125 125 150 200 475 Environmental 50 200 400 575 1,175 Nuclear Fuel 300 300 400 400 1,100 Lee Nucle

33. Slide 33: Select FE&G Capital Expenditures by Legal Entity

    SELECT FE&G CAPITAL EXPENDITURES BY LEGAL ENTITY ($ in Millions) 2011A 2012E 2013E 2014E 2012-2014 Total Environmental Carolinas $ 25 $ 25 $ 75 $ 150 $ 250 Indiana 25 175 300 375 850 Kentucky - - 25 50 75 Total Environmental $ 50 $ 200 $ 400 $ 575 $ 1,175 Customer Additions Carolinas $ 200 $ 200 $ 3

34. Slide 34: Nuclear Refueling Outages

    NUCLEAR REFUELING OUTAGES 2012 FY 2011 Actual Assumptions Oconee Unit 1 Oconee Unit 2 Oconee Unit 3 McGuire Unit 1 McGuire Unit 2 Catawba Unit 1 (19.25% Ownership Interest) Catawba Unit 2 (19.25% Ownership Interest) Total Number of Outages 5 5 Fourth Quarter and Year End Earnings Review and Business

35. Slide 35: Credit Metrics

    CREDIT METRICS (1) Duke Energy Consolidated Duke Energy Carolinas FFO/Debt FFO Interest Coverage FFO/Debt FFO Interest Coverage 22.0% 5.5 x 6.5 x 26.0% 19.0% 5.0 x 6.0 x 22.0% 4.5 x 5.5 x 16.0% 18.0% 4.0 x 5.0 x 13.0% 3.5 x 14.0% 4.5 x 10.0% 3.0 x 10.0% 4.0 x 2010A 2011A 2012E 2010A 2011A 2012E 2010

36. Slide 36: Regulatory Overview

    REGULATORY OVERVIEW Fourth Quarter and Year End Earnings Review and Business Update February 16, 2012 36

37. Slide 37: Future Rate Case Activity to Recover Costs

    FUTURE RATE CASE ACTIVITY TO RECOVER COSTS Jurisdiction 2012 2013 2014 File Second Half 2012 North Carolina 2011 Historical Test Period File Second Half 2012 South Carolina 2011 Historical Test Period Indiana Under Evaluation File Mid-2012 Ohio – Electric T&D Split historical and forward Test Period

38. Slide 38: Return on Equity

    RETURN ON EQUITY 10.50% 10.50% 10.63% 10.375% 9.75% - 10.25% 9.0% - 9.5% 9.25% - 9.75% 9.4% 9.0% - 9.5% 9.8% 9.4% 9.7% 9.1% 8.5% 7.3% 7.0% 6.3% 6.0% 4.6% Carolinas Indiana Ohio T&D (1) Kentucky (2) 2011A Reported 2011A 2011AAdjusted (4) 2012E 2012E Allowed Allowed Note: 2011 adjusted ROEs exclude co

39. Slide 39: Regulatory Overview

    REGULATORY OVERVIEW Current Rate Information (As of 2/16/2012) NC SC OH Electric OH Gas IN KY Electric KY Gas Rate Base in Rates $14.5B (1) $1.3B $700MM $5.6B $600MM (4) $200 MM (5) Allowed ROE 10.5% 10.5% 10.63% per NA per settlement 10.50% NA per 10.375% settlement settlement Equity 53.00% 53.00%

40. Slide 40: State Regulatory Jurisdictions

    STATE REGULATORY JURISDICTIONS Commission Overviews North South Indiana Ohio Kentucky Carolina Carolina Number 7 commissioners 7 commissioners 5 commissioners 5 commissioners 3 commissioners Term 8 year terms 4 year terms 4 year terms 5 year terms 4 year terms Appointed/ Appointed by Elected by the

41. Slide 41: Environmental Overview

    ENVIRONMENTAL OVERVIEW Fourth Quarter and Year End Earnings Review and Business Update February 16, 2012 41

42. Slide 42: Pending Environmental Regulations

    PENDING ENVIRONMENTAL REGULATIONS Coal Combustion Residuals (CCR) Mercury and Air Toxics Standards (MATS)  Regulates coal combustion residuals (e.g., coal ash)  Utility boiler Maximum Achievable Control Technology (MACT)  New rule proposed in June 2010 rule regulating Hazardous Air Pollutants (e.

43. Slide 43: Pending EPA Regulations Will Impact U.S. Generation

    PENDING EPA REGULATIONS WILL IMPACT U.S. GENERATION Major Regulations Duke Energy Domestic Generation Considerations for EPA Coal Combustion Coal Generation Profile Transition period must Residuals (Coal Ash) TODAY – 16.2 GW (1) POST MODERNIZATION (2) – 14.6 GW be reasonable to allow utilities time

44. Slide 44: Positioning Our Coal Fleet for EPA Regulations

    POSITIONING OUR COAL FLEET FOR EPA REGULATIONS Coal Generation Profile - Current Plans for Coal Generation Without Controls  Dan River ~275 MW expected to be retired in 2012 Carolinas  Riverbend ~450MW potential to be retired by 2015 Carolinas 3.4 GW 2.5 GW 1.4 GW ~7.3 GW  Lee ~370MW potential to

45. Slide 45: Duke Energy Steam Facility Data

    DUKE ENERGY STEAM FACILITY DATA Structure Operating State Jurisdiction Steam Unit Facility Owned Capacity (MW) Fuel Type Current Cooling Method Emissions Controls Regulated In Operation DE Carolinas Allen 1127 Coal Once-Through Scrubber Regulated In Operation DE Carolinas Belews Creek 2220 Coal Once

46. Slide 46: Non-Regulated Businesses

    NON-REGULATED BUSINESSES Fourth Quarter and Year End Earnings Review and Business Update February 16, 2012 46

47. Slide 47: Duke Energy Ohio ESP

    DUKE ENERGY OHIO ESP  ESP stipulation approved by Public Utilities Commission of Ohio on Nov. 22, 2011  Customers benefit from generation service provided per fully competitive auctions  Total non-bypassable stability charge of $330 million collected from 2012 – 2014 (1)  Requires generation tra

48. Slide 48: Commercial Power

    COMMERCIAL POWER Midwest Generation Guidance Assumptions 2012 Guidance Assumptions Generation Volumes (MM MWh’s) Midwest Generation 40 Owned Capacity (in MWs) ~6,220 megawatts (1) 30 PJM Capacity Revenues $120 million (1) 20 ESP Stability Charge $110 million (2) 10 Assumed Economic Generation Volume

49. Slide 49: Duke Energy International

    DUKE ENERGY INTERNATIONAL Brazil – Highly Contracted Business (Amounts in BRL Real)  Highly contracted position in Brazil – Contractible Capacity (~1,000 MW) Under Firm Contract 100% Brazil – average tenor over 5 99% 99% 94% years Average Average Average Average Realized Contracted Contracted Contr

50. Slide 50: Duke Energy International – Foreign Currency

    DUKE ENERGY INTERNATIONAL Foreign Currency Brazil FX – R$ / US$ 2.50 2.30 Unfavorable 2.10 1.90 Favorable 1.70 1.50 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Historical Forecast Real/US Dollar Brazilian Real – Annual Average Key Earnings Sensitivity to FX 2008A 2009A 2010A 2011A 2012E • Every 10% ch

51. Slide 51: Duke Energy International – National Methanol Company

    DUKE ENERGY INTERNATIONAL National Methanol Company (NMC) ►Equity investment in regional producer of Methanol and MTBE located in Saudi Arabia • JV agreement signed in 1981 - Saudi Basic Industries Corporation (SABIC) - 50%, Celanese - 25%, and Duke Energy - 25% • Duke Energy’s interest in NMC was o

52. Slide 52: Duke Energy International – Overview

    DUKE ENERGY INTERNATIONAL Overview % of DEI Adjusted 2011 Sales Segment EBIT3 Revenues Installed % Total DEI % Contracted in Under (in US$ Country Fuel / Product Capacity Capacity 2012E1 Construction GWh 2010 2011 millions) Brazil Hydro 2,119 MW 51% 99% 33 MW 11,511 $ 648 57% 53% Hydro 360 MW Peru N

53. Slide 53: Duke Energy International – Consolidated Market Overview

    DUKE ENERGY INTERNATIONAL Consolidated Market Overview Argentina Brazil Ecuador El Salvador Peru Guatemala Plants in Operation (owned capacity) 569 MW 2,241 MW 162 MW 296 MW 810 MW 363 MW Thermal 134 MW ----- 162 MW 296 MW 436 MW 363 MW Hydro 435 MW 2,241 MW ----- ----- 374 MW ----- Contractible Cap

54. Slide 54: Financial Overview

    FINANCIAL OVERVIEW Fourth Quarter and Year End Earnings Review and Business Update February 16, 2012 54

55. Slide 55: Dividend Policy

    DIVIDEND POLICY Duke Energy dividend policy DUK Annual Dividend Per Share History Continued growth in dividend at a rate slower than growth of adjusted diluted EPS $1.02 Targeting a long-term payout range of 65% $1.00 to 70% of adjusted diluted EPS $0.98 $0.96 Dividend supported by strong regula

56. Slide 56: Simplified Financing Structure

    SIMPLIFIED FINANCING STRUCTURE (DEC. 31, 2011) (1) Duke Energy Corporation Revolver Sublimit: $1.25 B LTD Outstanding: $3.90 B Total Consolidated LTD: $20.60 B Duke Energy Carolinas DE International Revolver Sublimit: $1.25 B Cinergy Corp. LTD Outstanding: $0.65 B LTD Outstanding: $9.25 B Duke Energ

57. Slide 57: Liquidity

    LIQUIDITY Liquidity (as of December 31, 2011) ($ in millions) Duke DE DE DE DE Energy Carolinas Ohio Indiana Kentucky Total (1) Master Credit Facility $ 1,250 $ 1,250 $ 700 $ 700 $ 100 $ 4,000 (2) Regional Bank Credit Facility 100 100 - - - 200 Less: Notes Payable and Commercial Paper (3) (75) (300)

58. Slide 58: Duke Energy Credit Ratings

    DUKE ENERGY CREDIT RATINGS Moody's S&P DUKE ENERGY Stable Stable Issuer Rating / Corporate Credit Rating Baa2 A- Senior Unsecured Debt Baa2 BBB+ Commercial Paper P-2 A-2 DUKE ENERGY CAROLINAS Stable Stable Senior Secured Debt A1 A Senior Unsecured Debt A3 A- DUKE ENERGY OHIO Stable Stable Senior Sec

59. Slide 59: Long-Term Debt Maturities (2012 – 2014)

    LONG-TERM DEBT MATURITIES (2012 – 2014) (1) ($ in millions) $1,870 $1,540 $1,610 Other DE International DE Kentucky DE Indiana DE Ohio DE Carolinas (2) Duke Energy Total 2012 2013 2014 (1) Excludes securitized receivables liquidity facility maturity in 2013 (expected to be renewed) (2) Includes a $7

60. Slide 60: Fourth Quarter and Year End Earnings Review and Business Update

    Fourth Quarter and Year End Earnings Review and Business Update February 16, 2012 60 60

61. Slide 61: Non-GAAP Reconciliations

    Duke Energy Corporation Non-GAAP Reconciliations Fourth Quarter and Full Year 2011 Earnings Review & Business Update February 16, 2012 Adjusted Diluted Earnings per Share (“EPS”) The materials for Duke Energy Corporation’s (“Duke Energy”) Fourth Quarter and Full Year 2011 Earnings Review and Busines

62. Slide 62: Adjusted Segment EBIT and Other Net Expenses

    directly comparable GAAP financial measure is not available at this time, as management is unable to project special items or mark-to-market adjustments for future periods. A reconciliation of adjusted diluted EPS for the year ended December 31, 2009, to the most directly comparable GAAP measure is

63. Slide 63: Impact of Favorable Weather on Adjusted Earnings

    Impact of Favorable Weather on Adjusted Earnings Reported diluted EPS for 2011 was $1.28. Adjusted diluted EPS for 2011 was $1.46. Weather-related EPS impacts are reflected within these reported and adjusted results for 2011. The most directly comparable GAAP measure for adjusted diluted EPS and the

64. Slide 64: Funds From Operations (FFO) Ratios

    Funds From Operations (“FFO”) Ratios The materials for Duke Energy’s Fourth Quarter and Full Year 2011 Earnings Review and Business Update on February 16, 2012 include a reference to historical and expected FFO interest coverage ratios and FFO to Total Debt ratios. These ratios reflect non-GAAP fina

65. Slide 65: 2012 Forecasted Cash Flow Reconciliation

    Duke Energy Corporation 2012 Forecasted Cash Flow Reconciliation, Required by SEC Regulation G 2011 Earnings Review and Business Update February 16, 2012 ($ in millions) Forecast 2012 Primary Sources: Adjusted net income (1) (a) $ 1,905 Depreciation & amortization (a) 2,115 Deferred and accrued taxe

66. Slide 66: Adjusted to Reported Earnings Reconciliation, Q4 2011

    DUKE ENERGY CORPORATION ADJUSTED TO REPORTED EARNINGS RECONCILIATION Three Months Ended December 31, 2011 (Dollars in millions, except per-share amounts) Special Items (Note 1) Costs to Achieve, Economic Adjusted Progress Hedges (Mark- Total Reported Earnings Merger to-Market) * Adjustments Earnings

67. Slide 67: Adjusted to Reported Earnings Reconciliation, Twelve Months 2011

    DUKE ENERGY CORPORATION ADJUSTED TO REPORTED EARNINGS RECONCILIATION Twelve Months Ended December 31, 2011 (Dollars in millions, except per-share amounts) Special Items (Note 1) Costs to Achieve, Emission Economic Adjusted Progress Edwardsport Allowances Hedges (Mark- Discontinued Total Reported Ear

68. Slide 68: Adjusted to Reported Earnings Reconciliation, Q4 2010

    DUKE ENERGY CORPORATION ADJUSTED TO REPORTED EARNINGS RECONCILIATION Three Months Ended December 31, 2010 (Dollars in millions, except per-share amounts) Special Items (Note 1) Voluntary Costs to Opportunity Achieve, Plan/Office Economic Adjusted Cinergy Consolidation Hedges (Mark- Discontinued Tota

69. Slide 69: Adjusted to Reported Earnings Reconciliation, Twelve Months 2010

    DUKE ENERGY CORPORATION ADJUSTED TO REPORTED EARNINGS RECONCILIATION Twelve Months Ended December 31, 2010 (Dollars in millions, except per-share amounts) Special Items (Note 1) Voluntary Costs to Opportunity Achieve, Plan/ Office Goodwill and Economic Adjusted Cinergy Consolidation Other Litigation

70. Slide 70: Adjusted to Reported Earnings Reconciliation, Twelve Months 2009

    DUKE ENERGY CORPORATION ADJUSTED TO REPORTED EARNINGS RECONCILIATION Twelve Months Ended December 31, 2009 (Dollars in millions, except per-share amounts) Special Items (Note 1) Crescent Costs to Related Achieve, Guarantees International Goodwill and Economic Adjusted Cinergy and Tax Transmission Ot

71. Slide 71: Available Liquidity Reconciliation

    Duke Energy Corporation Available Liquidity Reconciliation As of December 31, 2011 (In millions) Cash and Cash Equivalents $2,110 Short-Term Investments 190 Subtotal 2,300 Less: Amounts Held in Foreign Jurisdictions (1,037) $1,263 Plus: Remaining Availability under Master Credit and Regional Bank Cr

72. Slide 72: Reconciliation of As Reported Full Year 2011 Results to As Recasted

    Reconciliation of "As Reported" Full Year 2011 Results to "As Recasted" Commercial International Total Discontinued USFE&G Power Energy Segments Other Operations Eliminations Duke Energy Reported EBIT (Prior Segment Measure) $ 2,604 $ 225 $ 679 $ 3,508 $ (261) $ - $ - $ 3,247 Special Items: Edwardsp

Duke Energy — Q4 2011 Earnings Presentation on 6ix