American Electric Power Company, Inc. · NASDAQ:AEP
American Electric Power — Q1 2016 Earnings Presentation
19 slides from American Electric Power's earnings presentation, Apr 28, 2016
Slide 1: 1st Quarter 2016 Earnings Release Presentation
1st Quarter 2016 Earnings Release Presentation April 28, 2016 1
Slide 2: Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995 This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. Although AEP and each of its Registrant Subsidiaries believe that their expectations are
Slide 3: First Quarter 2016 Highlights
First Quarter 2016 Highlights First Quarter Company Update Earnings Update Delivered GAAP and operating earnings of $1.02 per share Reaffirm guidance range of $3.60 - $3.80 Reaffirm 4%-6% growth rate Regulatory & Strategic Update • PUCO Approval of Ohio PPA • FERC PPA Waiver Challenge • Ohio S
Slide 4: Regulated Returns
Regulated Returns Twelve Months Ended 03/31/2016 Earned ROEs (Operating Earnings*) OPCo 11.9% Trans I&M 10.9% 10.2% APCo PSO AEP TX 8.8% 8.6% SWEPCO 8.5% 7.9% KPCo 5.5% Regulated Operations ROE of 9.4% as of March 31, 2016 * operating adjusts GAAP results by eliminating any material non operating it
Slide 5: First Quarter Operating Earnings Segment Detail
First Quarter Operating Earnings Segment Detail $0.03 ($0.07) $0.02 $0.06 Rate Changes $ 0.01 AGR $ 0.01 $0.03 Normal Load $ 0.01 O&M $ (0.01) Trading & Mrkt Oklaunion PPA $ 0.04 $ (0.01) Other $ (0.01) Other $ 0.01 Rate Changes $ 0.04 Reg Prov - Va $ 0.03 O&M $ 0.03 OSS $ (0.09) PJM Chrgs $ 0.04 No
Slide 6: Normalized Load Trends
Normalized Load Trends Note: Charts reflect connected load and exclude firm wholesale load & Buckeye Power backup load. 6
Slide 7: Economic Data
JacP Economic Data GDP Growth by Quarter GDP Growth by Geography 4% 4% @US AEP MUS MAEP-East MAEP-West 5 3% 4 5 3% 4 5 F 3 2% 4 % 2% 3 3 § 1% 1% | 0% 0% + 1-15 15 Q3415 Q415 115 2-15. 3-15. 4-15 1-16 Employment Growth by Quarter Employment Growth by Geography 3% 5 mUS mAEP 3% 4 mUS m@AEP-East mAEP-W
Slide 8: Regional Industrial Sales Trends
Regional Industrial Sales Trends AEP Industrial Sales Map Shale gas development drives industrial load growth 8
Slide 9: Capitalization & Liquidity
Capitalization & Liquidity Total Debt / Total Capitalization Credit Statistics Actual Target FFO Interest Coverage 5.45x >3.6x FFO to Total Debt 20.0% 15%-20% Note: Credit statistics represent the trailing 12 months as of 03/31/2016 Liquidity Summary (unaudited) 3/31/2016 Actual ($ in millions) Amou
Slide 10: Summary
Summary Q1 in line with expectation Reaffirming 2016 Operating Earnings Guidance of $3.60 to $3.80/share and 4% to 6% growth rate Continue strategic review of competitive generation 10
Slide 11: Appendix
Appendix 11
Slide 12: 1st Quarter Reconciliation of GAAP to Operating Earnings
1st Quarter Reconciliation of GAAP to Operating Earnings $ millions Earnings Per Share Q1-15 Q1-16 Change Q1-15 Q1-16 Change Reported (GAAP) Earnings $629 $501 $(128) $1.29 $1.02 $(0.27) Non Operating Items: Mark-to-Market Impact of Commodity Hedging (4) - 4 (0.01) - 0.01 Activities AEP Operating Ea
Slide 13: Vertically Integrated Utilities
Vertically Integrated Utilities First Quarter Summary Key Drivers: Q1-16 vs. Q1-15 Q1-15 Q1-16 Rate changes: $44M from various jurisdictions $ millions (except EPS) VA regulatory provision: $23M unfavorable due to prior year reversal Operating Revenues $2,505 $2,246 Operating Expenses: Weather
Slide 14: Transmission & Distribution Utilities
Transmission & Distribution Utilities First Quarter Summary Key Drivers: Q1-16 vs. Q1-15 Q1-15 Q1-16 Rate changes: $6M from Ohio DIR $ millions (except EPS) Operating Revenues $1,270 $1,097 Weather: $11M unfavorable vs. prior year; $3M unfavorable vs. normal Operating Expenses: Energy Costs (452
Slide 15: AEP Transmission Holdco
AEP Transmission Holdco First Quarter Summary Key Drivers: 1Q-16 vs. 1Q-15 Q1-15 Q1-16 $15M favorable operating income due to $ millions (except EPS) increased capital investment in the wholly- Operating Revenues $58 $89 owned Transcos, offset by higher depreciation, Operating Expenses: O&M and ta
Slide 16: Generation & Marketing
Generation & Marketing First Quarter Summary Key Drivers: Q1-16 vs. Q1-15 Q1-15 Q1-16 Capacity revenues decreased $97M in Q1-16 vs $ millions (except EPS) Q1-15, due to plant retirements and transition of Ohio to full market pricing Operating Revenues $1,163 $748 Operating Expenses: AEP Dayton A
Slide 17: Retail Rate Performance
Retail Rate Performance Vertically Integrated Utilities Transmission & Distribution Utilities Rate Changes, net of Rate Changes, net of offsets (in millions) offsets (in millions) Q1-16 vs. Q1-15 Q1-16 vs. Q1-15 APCo/WPCo $22 Ohio Power $6 I&M $8 Texas Central - KPCo $7 Texas North - PSO $1 TOTAL $6
Slide 18: Retail Load Performance
Retail Load Performance Vertically Integrated Utilities Transmission & Distribution Utilities Retail Load* Retail Load* (weather (weather normalized) normalized) Q1-16 vs. Q1-15 Q1-16 vs. Q1-15 APCo/WPCo -0.9% Ohio Power -1.9% I&M 2.6% Texas Central 6.0% KPCo -4.7% Texas North -1.1% PSO 2.1% SWEPCO
Slide 19: Weather Impact
Weather Impact Vertically Integrated Utilities Transmission & Distribution Utilities Weather Impact Weather Impact (in millions) (in millions) Q1-16 vs. Q1-15 Q1-16 vs. Q1-15 APCo/WPCo ($34) Ohio Power - I&M ($19) Texas Central ($8) KPCo ($9) Texas North ($3) PSO ($6) TOTAL ($11) SWEPCO ($14) Kingsp
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