Txnm Energy, Inc. · NYSE:TXNM
Txnm Energy — PNM Resources — Q3 2016 Earnings Presentation
22 slides from Txnm Energy's earnings presentation, Oct 28, 2016
Slide 1: Q3 2016 Earnings Review
Q3 2016 Earnings Review October 28, 2016
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements made in this presentation that relate to future events or PNM Resources, Inc.’s (“PNMR”), Public Service Company of New Mexico’s (“PNM”), or Texas-New Mexico Power Company’s (“TNMP”) (collectively, the “Company”) expectations, projections, estimates, intentions, goal
Slide 3: Opening Remarks and Overview
Opening Remarks and Overview Pat Vincent-Collawn Chairman, President and CEO
Slide 4: Q3 2016 Financial Results and Company Updates
Q3 2016 Financial Results and Company Updates Financial Results: Q3 2016 Q3 2015 YTD 2016 YTD 2015 GAAP EPS $0.68(1) $0.76 $1.15(1) $1.34 Ongoing EPS $0.78 $0.76 $1.31 $1.41 EPS shown on a diluted basis 2016 Ongoing EPS Guidance of $1.55 - $1.65 affirmed Company Updates: PNM August 2015 General
Slide 5: Financial Overview
Financial Overview Chuck Eldred Executive Vice President and CFO
Slide 6: Load and Economic Conditions
Load and Economic Conditions Regulated Retail Energy Sales and Customers (weather-normalized, leap-year adjusted) % of 2015 Q3 2016 YTD 2016 % of 2015 % of 2015 Q3 2016 YTD 2016 PNM Sales vs. vs. TNMP Sales Sales vs. vs. Volumes Q3 2015 YTD 2015 Volumes Revenues Q3 2015 YTD 2015 Retail Load: Volumet
Slide 7: Q3 2016 Financial Summary
Q3 2016 Financial Summary Ongoing EPS $0.01 $0.01 $0.78 $0.76 $0.00 PNM TNMP Corporate/ Other Q3 2015 Q3 2016 7
Slide 8: Q3 2016 vs Q3 2015 EPS (Ongoing): PNM and TNMP
Q3 2016 vs Q3 2015 EPS (Ongoing): PNM and TNMP PNM Q3 2016 Key Performance Drivers ∆ EPS $0.60 $0.60 Lower operations and maintenance costs $0.04 Elimination of Palo Verde Unit 2 lease costs, net of depreciation $0.03 Customer mix and load $0.02 Retail rate relief, net of renewable rider $0.01 AFUDC
Slide 9: Capital Forecast
Capital Forecast 2016 – 2019 Total Capital Plan: $1.9B PNM 2015-2019 Rate Base CAGR: 4 - 6%(1) TNMP 2015-2019 Rate Base CAGR: 8 - 10% $573 (In millions) $36 $516 Palo Verde Unit 3 added to $57 rate base $125 $435 $395 $15 $151 $30 $120 $137 $134 $170 $163 $119 $292 $221 $238 $243 $198 $138 $112 $119
Slide 10: 2017 - 2019 Potential Earnings Power
2017 - 2019 Potential Earnings Power Allowed 2017 Earnings Potential 2018 Earnings Potential 2019 Earnings Potential Return / Equity Avg Rate Avg Rate Avg Rate EPS EPS EPS Ratio Base Base Base PNM Retail (1) 9.575% / 50% $2.3 B $1.36 $2.4 B $1.42 $2.4 B $1.41 Supreme Court Appeal (2) $0 - $150 M $0.
Slide 11: Above Industry Average Earnings and Dividend Growth
Above Industry Average Earnings and Dividend Growth 7% - 8% Earnings Growth 2015 - 2019 $1.64 $1.65 $1.55 $1.41 $1.49 $1.31 $0.88 $0.74 $0.80 $0.66 Dec ‘15 $0.58 Dec ‘13 Dec ‘14 Feb ‘13 Feb ‘12 2012 2013 2014 2015 2016E 2017E 2018E 2019E Ongoing EPS Indicated Annual Dividends 2012 – 2015 actual resu
Slide 12: Sustainability Portal
Sustainability Portal http://www.pnmresources.com/about-us/sustainability-portal.aspx 12
Slide 13: Questions and Answers
Questions and Answers
Slide 14: Appendix
Appendix
Slide 15: 2016 EPS Guidance (Ongoing)
2016 EPS Guidance (Ongoing) 2016 Guidance $1.55 Consolidated EPS $1.65 PNM TNMP Corp/Other $1.08 - $1.16 $0.50 - $0.51 ($0.03) – ($0.02) 15
Slide 16: PNM General Rate Case Final Order
PNM General Rate Case Final Order • Approved Sept. 28, 2016; New Mexico Supreme Court appeal filed Sept. 30, 2016: • Non-fuel revenue increase of $61.2M versus $121.5M request • Retail rate base of $2,263M versus $2,458M request Key Rate Case Elements Commission Recommended Original Impact to (PNM R
Slide 17: Weather Impact
Weather Impact PNM Q3 2016 Q3 2015 2016 Normal(1) Heating Degree Days 13 0 15 Cooling Degree Days 991 1,090 1,013 Net EPS Impact $0.00 $0.00 compared to normal TNMP Q3 2016 Q3 2015 2016 Normal(1) Heating Degree Days 0 0 0 Cooling Degree Days 1,795 1,827 1,745 Net EPS Impact $0.00 $0.00 compared to n
Slide 18: PNM Plant Outages
PNM Plant Outages 2016 - 2017 Planned Outage Schedule Four Corners Palo Verde Duration in Time Duration in Time Unit Unit Days Period Days Period 4 10 Q2 2017 3 34 Q4 2016 5 10 Q2 2017 2 34 Q2 2017 5 95 Q3-Q4 2017 1 34 Q4 2017 Scheduled Unit Retirements San Juan Duration in Time Unit Days Period 2 R
Slide 19: Balance Sheet and Credit Metrics
Balance Sheet and Credit Metrics
Slide 20: Liquidity as of October 21, 2016
Liquidity as of October 21, 2016 PNM Corporate/ Resources PNM TNMP Other Consolidated Financing Capacity(1): (In millions) Revolving credit facilities $450.0 $75.0 $300.0 $825.0 As of 10/21/16: Short-term debt and LOC balances $32.5 $0.1 $199.6 $232.2 Remaining availability 417.5 74.9 100.4 592.8 In
Slide 21: Selected Balance Sheet Information
Selected Balance Sheet Information (In millions) Dec 31, 2015 Sept 30, 2016 Long-Term Debt (incl. current portion) (1) PNM $1,580.7 $1,631.6 TNMP 361.4 420.8 Corporate/Other 149.9 256.0 Consolidated $2,091.9 $2,308.3 Total Debt (incl. short-term) (2) PNM $1,580.7 $1,674.0 TNMP 420.4 420.8 Corporate/
Slide 22: Credit Ratings
Credit Ratings PNMR S&P Moody’s Credit rating BBB+(1) Baa3(1) Issuer outlook Stable Stable PNM S&P Moody’s Credit rating BBB+(2) Baa2(2) Issuer outlook Stable Stable TNMP S&P Moody’s Credit rating A(3) A1(3) Issuer outlook Stable Stable (1) Issuer/Corporate rating (2) Senior unsecured (3) Senior sec