Oge Energy Corp · NYSE:OGE
Oge Energy — Q4 2021 Earnings Presentation
18 slides from Oge Energy's earnings presentation, Feb 24, 2022
Slide 1: Q4 2021 Earnings and Business Update Conference Call
Q4 2021 Earnings and Business Update Conference Call February 24, 2022
Slide 2: Safe Harbor
Safe Harbor Some of the matters discussed in this presentation may contain forward-looking statements that are subject to certain risks, uncertainties, and assumptions. Such forward-looking statements are intended to be identified in this document by the words "anticipate," "believe," "estimate," "e
Slide 3: Building a Sustainable Business Model
Building a Sustainable Business Model Changed operational paradigm to focus on Concentrated economic development Reframed the customer experience reliability, resiliency, and affordability efforts to drive customer and load growth © 2022 OGE Energy Corp. | 3
Slide 4: Summary of 2021 Financial Results
Summary of 2021 Financial Results $1.83 $1.80 $1.79 ✓ Strong execution allowed us to deliver at the midpoint of $1.70 the narrowed utility guidance range of $1.79 - $1.83 per share1 2020 2021 OG&E (Electric Utility) ➢ Holding Company and Other Operations resulted in a loss of $0.04 per share ➢ Natur
Slide 5: 2021 Achievements
2021 Achievements ✓ 2nd best safety year on record • #1 in the SEE in 2021 • Each of the last 6 years are the best in the Company's history ✓ 2022 Escalent Business Customer Champion ✓ Continued grid modernization investments ✓ Planned investments in renewables ✓ Active regulatory schedules in OK &
Slide 6: Strong Economic Indicators & Load Results
Strong Economic Indicators & Load Results Customer Growth Load Growth1 1.4% 2.4% 2020 2021 2020 2021 • 2022 expected load growth in 3.5% to 5% range • Economic development attracts new customers with our nation-leading lowest electric rates2 • As of December 2021, Oklahoma City ranked #3 for lowest
Slide 7: OGE Sustainable Business Model
OGE Sustainable Business Model Growth & Investment Long-term Vision for Economic Development Shareholders • Grow Utility EPS 5-7% annually1 Growth in our Communities • 65-70% dividend payout Reliability, Resiliency, Affordability 1. From the midpoint of 2021 Utility guidance of $1.81 per share © 202
Slide 8: 2021 EPS Results
2021 EPS Results • Operational excellence allows OG&E to deliver within original and narrowed EPS guidance range 2021 2020 Drivers Strong Load Growth of 2.4% h Recovery of increased infrastructure investments h OG&E $1.80 $1.70 Winter storm Uri impacts i Higher depreciation on growing asset base i G
Slide 9: 2021 Load Results
2021 Load Results KEY TAKEAWAYS 20211 Load vs 2020 - Weather normalized 5.9% • 2021 full year results were 0.0% 3.4% 0.8% 3.5% 2.4% 2.4% above 2020, driven by Residential Commercial Industrial Oilfield Public Authority Total Retail strength in commercial and industrial classes, as well as maintainin
Slide 10: 2022 Load Forecast
2022 Load Forecast 2022 Forecast Load vs 20211 15.0% 8.5% 10.0% 5.0% 3.0% 1.0% 1.0% 6.5% 3.5% 0.0% -0.5% 1.0% Residential Commercial Industrial Oilfield Public Authority Total Retail KEY TAKEAWAYS • Forecasting 3.5% to 5.0% load growth over 2021 levels • Load increase is driven by strong commercial
Slide 11: OG&E 2022 Financial Plan Drivers
OG&E 2022 Financial Plan Drivers • 2022 OG&E (Utility) EPS Guidance Range is $1.87- $1.97 per average diluted share • Mid-point of $1.92 represents 6% growth from 2021’s guidance midpoint of $1.81 EPS $2.20 $0.03 $2.10 $0.10 Yearly EPS ($/share) $2.00 $0.16 $1.97 $0.08 $1.90 $0.05 $1.80 $0.04 $1.87
Slide 12: Investing in our Communities
Investing in our Communities Strong load growth • 5-year capital plan of $4.75 billion and robust • Strong customer growth and T&D resiliency projects drive grid infrastructure investment investment needs of • Over 75% of the 5-year capital plan is customer focused T&D investments our communities •
Slide 13: 2022 Financing Plan Update
2022 Financing Plan Update • Balance sheet strength supports long-term growth plan and dividend1 • No equity issuances planned in 5-year horizon • Utilize proceeds from the sale of Energy Transfer units for reinvestment in core business • We’ve received an Energy Transfer quarterly distribution of a
Slide 14: Appendix
Appendix © 2022 OGE Energy Corp. | 14
Slide 15: 4th Quarter 2021 Results
4th Quarter 2021 Results 4Q 2021 4Q 2020 Drivers Recovery of increased infrastructure investments h Unfavorable weather i Recognition of loss associated with the Winter Storm Uri regulatory settlement i OG&E $0.20 $0.21 Higher depreciation on growing asset base i Higher O&M i Natural Gas Midstream $
Slide 16: EPS Bridge from 2021 Midpoint to 2021 Actual
EPS Bridge from 2021 Midpoint to 2021 Actual ✓ Strong execution allowed us to deliver at the midpoint of the narrowed guidance range of $1.79 - $1.83 per share1 $2.00 $1.95 $1.90 $0.04 $0.12 $1.85 $1.81 $1.80 EPS ($/share) $1.80 $0.03 $1.75 $0.10 $1.71 $1.70 $0.04 $1.65 $1.60 $1.55 $1.50 2021 Midpoi
Slide 17: Weather Impact
Weather Impact Weather Variance Heating Degree Days 2021 2020 % Change Actuals 3,281 3,303 (1%) Normal 3,452 3,354 3% Variance from Normal (5%) (2%) Cooling Degree Days 2021 2020 % Change Actuals 1,896 1,804 5% Normal 1,912 2,095 (9%) Variance from Normal (1%) (14%) 20211 Load vs 2020 Weather Normal
Slide 18: Projected Rate Base
Projected Rate Base $11,000 $10,369 KEY TAKEAWAYS $10,000 $9,848 Based off 5-year capital plan of $9,306 $4.75 billion, supported by strong $9,000 $8,744 customer growth and T&D $8,155 $ millions resiliency projects that drive $8,000 $7,554 incremental grid infrastructure $7,039 investments. $7,000