Slide 1: Second Quarter 2019 Results
August 2, 2019 Second Quarter 2019 R E S U LT S
Slide 2: Safe Harbor Statements
SAFE HARBOR STATEMENTS Cautionary Note Regarding Forward-Looking Statements The information presented herein includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, which are based on current expectations, esti
Slide 3: Safe Harbor Statements (Cont'd)
SAFE HARBOR STATEMENTS (CONT’D) Information About Non-GAAP Financial Measures and Items Affecting Comparability "Adjusted EBITDA" (EBITDA as adjusted for unrealized gains or losses from hedging activities, tax receivable agreement obligations, reorganization items, and certain other items described
Slide 4: Agenda
AGENDA I Welcome and Safe Harbor Molly Sorg, VP Investor Relations II Q2 2019 Highlights Curt Morgan, President and Chief Executive Officer III Financial Highlights David Campbell, Executive Vice President and Chief Financial Officer V i s t ra E nergy I nv es t or P res ent at i on / Q2 2019 4
Slide 5: Q2 2019 Highlights
Q2 2019 Highlights Curt Morgan Chief Executive Officer V i s t ra E nergy I nv es t or P res ent at i on / Q2 2019
Slide 6: Q2 2019 Highlights
Q2 2019 HIGHLIGHTS Q2 2019 Financial Results Ongoing Operations ($ millions) Q2 2019 Adjusted EBITDA1 $707 YTD 2019 Adjusted EBITDA1 $1,522 • Second quarter results were above consensus and in-line with management expectations • $44 million2 above Q2 2018 primarily due to higher retail gross margin
Slide 7: EBITDA and FCF Stability – Retail
EBITDA AND FCF STABILITY – RETAIL Vistra’s Retail Segment has demonstrated stable margins across varying wholesale cycles by managing customer pricing and the customer experience Integrated model ✓ Vistra’s Retail EBITDA has demonstrated stable Retail revenue margins, averaging ~$800M over the last
Slide 8: EBITDA and FCF Stability – Wholesale
EBITDA AND FCF STABILITY – WHOLESALE Vistra creates stability in the EBITDA and FCF generated by its Wholesale Segment via revenue and geographic diversity, and commercial optimization Creating a More Stable EBITDA and FCF Profile • Commercial team uses volatility in forward curves to create EBITDA
Slide 9: ERCOT Market Update
ERCOT MARKET UPDATE Forward Curves Dislocated Historical Curve Volatility from Fundamentals ERCOT North 5X16 Forward Prices Historical Forward ERCOT North Hub Summer 2019 5x16 Heat Rates1,2 Summer 2020 & 2021 55 125 115 50 mmbtu/MWh 105 $/MWh 45 95 85 40 75 35 65 30 Jan-19 Feb-19 Mar-19 Apr-19 May-1
Slide 10: PJM Market Update
PJM MARKET UPDATE The recent decline in PJM forward curves was, for the most part, not driven by market fundamentals • In mid-May, forward curves began to decline PJM WH Peak Power Price driven by an overall bearish view of the 41 market and physical players mitigating risk 39 • As prices declined,
Slide 11: Vistra Opportunities
VISTRA OPPORTUNITIES Vistra has already announced multiple value accretive opportunities and will continue to opportunistically evaluate future growth investments that meet or exceed our investment threshold 2019E EBITDA 2021E EBITDA Value Opportunity Contribution Contribution ~$120M full run rate o
Slide 12: Financial Highlights
Financial Highlights David Campbell Chief Financial Officer V i s t ra E nergy I nv es t or P res ent at i on / Q2 2019
Slide 13: Q2 2019 Financial Results
Q2 2019 FINANCIAL RESULTS Vistra executed a solid second quarter delivering year -to-date results that are in-line with management expectations ONGOING OPERATIONS ADJUSTED EBITDA1 HIGHLIGHTS ($ in millions) Q2 Ongoing Operations Adj. EBITDA1: $707 million 1,522 • Increase of $44 million as compared
Slide 14: Q2 Financing Transactions
Q2 FINANCING TRANSACTIONS Vistra executed refinancing transactions in the second quarter that reduce interest expense and advance the company’s balance sheet restructuring Issuance Use of Proceeds/Impact • $1,200 million Senior Secured • Refinanced $2,000 million of Vistra Operations Term Loan Notes
Slide 15: Capital Allocation
CAPITAL ALLOCATION Vistra is committed to executing on previously-announced capital allocation plan Share Repurchase Program Dividend Program Leverage Target $462M Paid quarterly dividend of of authorized $1.75B Tracking toward long-term remains available for repurchases as of July 25, 2019 $0.125/s
Slide 16: Q&A
Q&A V i s t ra E nergy I nv es t or P res ent at i on / Q2 2019
Slide 17: Appendix
Appendix V i s t ra E nergy I nv es t or P res ent at i on / Q2 2019
Slide 18: Corporate Debt Profile
CORPORATE DEBT PROFILE ($ in millions) 6/30/19 2019E Term Loan B $3,798 $3,798 Senior Secured Notes 2,000 2,000 Senior Notes1 4,735 4,335 Other2 773 704 Total Long Term Debt3 $11,306 $10,837 Less: cash and cash equivalents1,4 (554) (400) Net Debt (after recurring dividend payments) $10,752 $10,437 O
Slide 19: Select Debt Balances
SELECT DEBT BALANCES FUNDED DEBT TRANCHES As of June 30, 20191,2 ($ in millions) Issuer Series Principal Outstanding Secured Facilities Vistra Operations Senior Secured Term Loan B-1 due August 2023 $1,897 Vistra Operations Senior Secured Term Loan B-3 due December 2025 1,901 Vistra Operations 3.550
Slide 20: Capital Expenditures
CAPITAL EXPENDITURES CAPITAL EXPENDITURES1 2019E - 2020E ($ in millions) 2019E 2020E Nuclear & Fossil Maintenance2 $415 $474 Nuclear Fuel 74 76 Non-Recurring3 90 - Growth 43 - Total Capital Expenditures $623 $550 Non-Recurring3 (90) - Growth (43) - Adjusted Capital Expenditures $490 $550 1 Excludes
Slide 21: Second Quarter Retail Metrics
SECOND QUARTER RETAIL METRICS Q2 2019 RETAIL HIGHLIGHTS RETAIL VOLUME All markets (in GWh) ✓ Lower volumes driven by mild weather largely offset 17,180 16,706 by margin performance 2,626 2,590 ✓ Continued strong sales performance in business 8,905 9,253 markets segment 5,649 4,863 ✓ In ERCOT, achiev
Slide 22: Second Quarter Generation Metrics
SECOND QUARTER GENERATION METRICS TOTAL GENERATION CAPACITY FACTOR (CCGT) TWhs Q2 2018 Q2 2019 YTD 20181 YTD 2019 % Q2 2018 Q2 2019 YTD 20181 YTD 2019 ERCOT 20.4 18.9 37.5 39.0 ERCOT 47% 49% 56% 49% PJM 11.3 10.6 11.3 25.1 PJM 65% 60% 65% 67% NY/NE 3.8 3.7 3.8 8.6 NY/NE 40% 36% 40% 42% MISO 6.3 5.2
Slide 23: Commercial Operations
COMMERCIAL OPERATIONS Hub ATC Price Forecasted Premium2 Forecasted Discount2 ($/MWh) ERCOT PJM $48 95 $48 95 $48 95 $48 95 $34.77 ~89 TWhs $35.41 ~89 TWhs $29.90 $38 75 $38 75 $38 75 $38 75 $6.84 $6.49 $28.63 $28 55 $28 55 $28 $2.51 55 $28 $3.88 55 ~54 TWhs ~50 TWhs $18 35 $18 $28.93 35 $18 $26.13 3
Slide 24: Hedge Profile – ERCOT
HEDGE PROFILE – ERCOT NATURAL GAS HEDGE PROFILE HEAT RATE HEDGE PROFILE 100% 98% 100% 100% 94% 95% 70% 52% 12/29/17 3/30/18 9/30/18 6/28/19 3/29/19 3/30/18 6/29/1811 12/31/18 3/29/19 12/29/17 3/30/18 9/30/18 6/28/19 3/30/18 6/29/18 12/31/18 3/30/18 12/29/17 3/29/196/29/18 9/30/18 3/30/1811 6/28/19 1
Slide 25: Hedge Profile – Other Markets
HEDGE PROFILE – OTHER MARKETS GENERATION VOLUMES HEDGED (2019) GENERATION VOLUMES HEDGED (2020) MISO/CAISO NENY PJM MISO/CAISO NENY PJM 100% 94% 95% 93% 79% 78% 74% 67% 55% 53% 37% 32% 3/29 6/28 3/29 6/28 3/29 6/28 3/29 6/28 3/29 6/28 3/29 6/28 NATURAL GAS MARGIN SENSITIVITY1 HEAT RATE MARGIN SENSIT
Slide 26: Market Pricing – ERCOT
MARKET PRICING – ERCOT MONTHLY NORTH HUB ATC POWER PRICES IMPLIED NORTH HUB ATC MARKET HEAT RATES 120 40 August 19 August 19 100 35 August 20 August 20 30 (mmBtu/MWh) 80 27.28 ($/MWh) 25 25.57 $67.22 60 $59.15 $34.67 20 40 $26.58 11.53 15 9.28 20 10 - 5 2017A 2018A 2019E 2020F 2017A 2018A 2019E 2020
Slide 27: Market Pricing – Other Markets
MARKET PRICING – OTHER MARKETS MONTHLY AD HUB ATC POWER PRICES MONTHLY INDIANA HUB ATC POWER PRICES 60 60 50 50 40 40 ($/MWh) ($/MWh) 30 30 20 20 10 10 - - 2017A 2018A 2019E 2020F 2017A 2018A 2019E 2020F Settled 3/29/2019 Forward 6/28/2019 Forward Settled 3/29/2019 Forward 6/28/2019 Forward MONTHLY
Slide 28: Capacity Position – MISO
CAPACITY POSITION – MISO MISO Capacity Position (excludes PJM exports) Price in $/kw-mo Total EBITDA Contribution PY 18/19 MWs 2,571 Average Price $3.24 $100 MM PY 19/20 MWs 2,127 Average Price $3.69 $94 MM PY 20/21 MWs 1,725 Average Price $3.95 $82 MM PY 21/22 MWs 660 Average Price $4.23 $34 MM MIS
Slide 29: Capacity Positions – PJM
CAPACITY POSITIONS – PJM (excludes MISO Imports) PJM Region Planning Year Average Price MW Position Average Price MW Position ($/MW-day) ($/MW-day) Legacy/Base Product Capacity Performance Product 2018 – 2019 $199.39 948 $165.13 4,599 2019 – 2020 $179.49 520 $126.87 4,797 RTO 2020 – 20211 N/A N/A $9
Slide 30: Capacity Positions – ISO-NE / NYISO / CAISO
CAPACITY POSITIONS – ISO-NE / NYISO / CAISO ISO/Region Contract Type Average Price MW Position Tenor ISO-NE1 ISO-NE Capacity $9.70/kw-Mo 3,395 June 2018 to May 2019 $6.97/kw-Mo 3,273 June 2019 to May 2020 $5.40/kw-Mo 3,229 June 2020 to May 2021 $4.80/kw-Mo 2,762 June 2021 to May 2022 $3.92/kw-Mo 3,2
Slide 31: Asset Fleet Details
ASSET FLEET DETAILS Asset Location ISO Technology Primary Fuel Net Capacity Ownership Interest Moss Landing 1 & 2 Moss Landing, CA CAISO CCGT Gas 1,020 100% Oakland Oakland, CA CAISO CT Oil 165 100 TOTAL CAISO 1,185 Forney Forney, TX ERCOT CCGT Gas 1,912 100% Lamar Paris, TX ERCOT CCGT Gas 1,076 100
Slide 32: Asset Fleet Details (Cont'd)
ASSET FLEET DETAILS (CONT’D) Asset Location ISO Technology Primary Fuel Net Capacity Ownership Interest Independence Oswego, NY NYISO CCGT Gas 1,212 100% TOTAL NYISO 1,212 Bellingham Bellingham, MA ISO-NE CCGT Gas 566 100% Bellingham NEA Bellingham, MA ISO-NE CCGT Gas 157 50 Blackstone Blackstone, M
Slide 33: Non-GAAP Reconciliations – Q2 2019 Adjusted EBITDA
NON-GAAP RECONCILIATIONS – Q2 2019 ADJUSTED EBITDA VISTRA ENERGY CORP. – NON-GAAP RECONCILIATIONS THREE MONTHS ENDED JUNE 30, 2019 (Unaudited) (Millions of Dollars) Eliminations/ Ongoing Vistra Energy Retail ERCOT PJM NY/NE MISO Corp and Operations Asset Closure Consolidated Other Consolidated Net I
Slide 34: Non-GAAP Reconciliations – 1H 2019 Adjusted EBITDA
NON-GAAP RECONCILIATIONS – 1H 2019 ADJUSTED EBITDA VISTRA ENERGY CORP. – NON-GAAP RECONCILIATIONS SIX MONTHS ENDED JUNE 30, 2019 (Unaudited) (Millions of Dollars) Eliminations/ Ongoing Vistra Energy Retail ERCOT PJM NY/NE MISO Corp and Operations Asset Closure Consolidated Other Consolidated Net Inc
Slide 35: Non-GAAP Reconciliations – Q2 2018 Adjusted EBITDA
NON-GAAP RECONCILIATIONS – Q2 2018 ADJUSTED EBITDA VISTRA ENERGY CORP. – NON-GAAP RECONCILIATIONS THREE MONTHS ENDED JUNE 30, 2018 (Unaudited) (Millions of Dollars) Eliminations/ Ongoing Vistra Energy Retail ERCOT PJM NY/NE MISO Corp and Operations Asset Closure Consolidated Other Consolidated Net I
Slide 36: Non-GAAP Reconciliations – 1H 2018 Adjusted EBITDA
NON-GAAP RECONCILIATIONS – 1H 2018 ADJUSTED EBITDA VISTRA ENERGY CORP. – NON-GAAP RECONCILIATIONS SIX MONTHS ENDED JUNE 30, 2018 (Unaudited) (Millions of Dollars) Eliminations/ Ongoing Vistra Energy Retail ERCOT PJM NY/NE MISO Corp and Operations Asset Closure Consolidated Other Consolidated Net Inc
Slide 37: Non-GAAP Reconciliations – 2019 Guidance
NON-GAAP RECONCILIATIONS – 2019 GUIDANCE VISTRA ENERGY CORP. – NON-GAAP RECONCILIATIONS 2019 GUIDANCE (Unaudited) (Millions of Dollars) Ongoing Operations Asset Closure Vistra Energy Consolidated Low High Low High Low High Net Income (loss) 1,331 1,486 (66) (56) 1,265 1,430 Income tax expense 363 40
Slide 38: End Slide
VICTDA owe = ENERGY END SLIDE