Txnm Energy, Inc. · NYSE:TXNM
Txnm Energy — PNM Resources — Q3 2020 Earnings Presentation
24 slides from Txnm Energy's earnings presentation, Oct 30, 2020
Slide 1: Q3 2020 Earnings Review
November 1, 2019 Q3 2020 Earnings Review October 30, 2020
Slide 2: Safe Harbor Statement
Safe Harbor Statement Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 Statements made in this news release for PNM Resources, Inc. (“PNMR”), Public Service Company of New Mexico (“PNM”), or Texas-New Mexico Power Company (“TNMP”) (collectively, the “Company”) that re
Slide 3: Overview and ESG Highlights
Overview and ESG Highlights Pat Vincent-Collawn Chairman, President and CEO
Slide 4: Q3 2020 Financial Results and Highlights
Q3 2020 Financial Results and Highlights Q3 2020 Earnings: Financial Results • Continued increases in Q3 2020 Q3 2019 YTD 2020 YTD 2019 GAAP EPSClean$1.52 Energy $1.28 Strong residential usage due to COVID-related restrictions Financial $2.05 $0.57 Ongoing EPS Focus $1.40 $1.31 $2.13 Profile $1.80 w
Slide 5: Shareholder and Regulatory Approvals
Shareholder and Regulatory Approvals Filings and approvals expected within ~12 months Shareholder Approval • Proxy expected December 2020 • Meeting/vote expected February 2021 Regulatory Approvals and Estimated Timelines • New Mexico Public Regulation Commission (NMPRC) 8-14 months • Public Utility
Slide 6: Q3 2020 ESG Highlights
Q3 2020 ESG Highlights Environmental Caring for Leadership Customer Communities Support • New electric vehicle fleet • New PNM COVID Customer • Continued financial goals: 25% of new light duty Relief Program, matched support and PPE donations fleet vehicle purchases will by local non-profit partner
Slide 7: Financial Updates
Financial Updates Don Tarry Senior Vice President and CFO
Slide 8: Q3 2020 Ongoing EPS Financial Summary
Q3 2020 Ongoing EPS Financial Summary Year-over-year increase at PNM reflects: Clean Energy Strong Financial Q3 Earnings Summary • Continued increases in Focus Profile $0.09 ($0.01) $0.01 $1.40 residential usage due to $1.31 COVID-related restrictions PNM TNMP Corporate were further increased by rec
Slide 9: Continued COVID-19 Load Impacts
Continued COVID-19 Load Impacts Expected impacts reflect continued increases from Residential customers and decreases from Commercial and Industrial customers due to business restrictions PNM COVID load trends TNMP COVID load trends • Residential: +5% increase • Volumetric: +5% increase • Commercial
Slide 10: 2020 Consolidated Ongoing Earnings Guidance
2020 Consolidated Ongoing Earnings Guidance 2020 Earnings Guidance Clean Energy $2.23 Strong Consolidated EPS Financial $2.31 $2.23 - $2.31 Focus guidance affirmed, Profile PNM TNMP Corp/Other targeting midpoint of $2.27 $1.72 – $1.77 $0.72 – $0.74 ($0.21) – ($0.20) Previous guidance: Previous guida
Slide 11: 2020 – 2024 Investment Plan
2020 – 2024 Investment Plan $4.1B investment plan focused on T&D infrastructure investments $1,016 117 $807 34 30 $766 $761 27 $712 277 120 125 123 27 31 123 26 197 201 (in millions) 185 202 201 337 320 342 348 $337 298 $361 $273 $289 $316 93 83 76 55 64 2020 2021 2022 2023 2024 PNM Generation TNMP
Slide 12: Potential Earnings Power through Close of Acquisition
Potential Earnings Power through Close of Acquisition 2020 Ongoing Earnings Allowed 2021 Earnings Potential Guidance Midpoint Return / Avg Rate Avg Rate Equity Ratio Return EPS EPS Base Base PNM Retail(1) 9.575% / 50% $2.5 B 9.575% $1.51 $2.5 B $1.41 PNM Renewable Rider 9.575% / 50% $150 M 9.575% $0
Slide 13: Credit Ratings
Credit Ratings Investment grade credit PNMR Consolidated S&P Moody’s ratings at PNM Resources, Issuer rating BBB Baa3 PNM and TNMP Outlook Positive Stable Senior unsecured rating BBB- Baa3 Acquisition considered credit positive by S&P and PNM S&P Moody’s Moody’s Issuer rating BBB Baa2 • S&P: PNM Res
Slide 14: Questions and Answers
Questions and Answers
Slide 15: Appendix
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Slide 16: COVID-19 Update
COVID-19 Update Restrictions ongoing in New Mexico and Texas in response to rising case numbers, continue to prioritize the safety of our team, caring for our customers and communities Phased re-openings in May and June; restrictions re-instated during July – October in response to rising case numbe
Slide 17: PNM and TNMP Regulatory Agenda
PNM and TNMP Regulatory Agenda Filing Action Timing Docket No. PNM: Decoupling Filing Petition for Declaratory Order to be filed (Petition for Approval of Rate Procedural schedule has been stayed to clarify the Oct. 30, 2020; expected to include 20-00121-UT Adjustment Mechanism to Remove legal appli
Slide 18: Demonstrating ESG Principles
Demonstrating ESG Principles ENVIRONMENTAL Emissions-free by 2040: industry-leading goal for the full elimination of carbon emissions from generation Significant progress achieved in emissions and freshwater usage Rapid growth in owned and purchased renewable resources delivered to customers SOCIAL
Slide 19: Q3 2020 vs Q3 2019 EPS (Ongoing): PNM
Q3 2020 vs Q3 2019 EPS (Ongoing): PNM • Continued increases in PNM residential usage due to COVID- related restrictions were further $1.12 increased by record-high August temperatures in New Mexico, $1.03 partially offset by reduced commercial usage • Refinancing of debt at lower interest rates Q3 2
Slide 20: Q3 2020 vs Q3 2019 EPS (Ongoing): TNMP and Corporate
Q3 2020 vs Q3 2019 EPS (Ongoing): TNMP and Corporate • TCOS increases implemented in TNMP September 2019 and March $0.31 $0.30 2020; DCOS increase implemented in September 2020 • The combined impacts of COVID- 19 and temperatures that were Q3 2019 Q3 2020 lower than Q3 2019 were largely Q3 2020 Key
Slide 21: COVID-19 Load: Assumptions and EPS Sensitivities
COVID-19 Load: Assumptions and EPS Sensitivities PNM TNMP COVID-19 Planning Assumptions: CleanCOVID-19 Energy PlanningStrong Assumptions: Financial Current Expectation Focus Current Expectation Profile Residential + 5% Volumetric + 5% Commercial -10% Demand-Based - 5% Industrial No significant impac
Slide 22: Weather Impact
Weather Impact Q3 Q3 2020 PNM 2020 2019 Normal(1) PNM Cooling Degree Days Heating Degree Days 19 0 0 in Q3 2020 were 15% Cooling Degree Days 1,107 1,129 960 higher than Normal Net EPS Impact compared to normal $0.07 $0.07 Q3 Q3 2020 TNMP 2020 2019 Normal(1) TNMP Cooling Degree Heating Degree Days 0
Slide 23: PNM Scheduled Plant Outages
PNM Scheduled Plant Outages 2020 Planned Outage Schedule San Juan Four Corners Palo Verde Duration Time Duration Time Duration Time Unit Unit Unit in Days Period in Days Period in Days Period No planned outages in 2020 5 13 Q4 2020 1 44 Q4 2020 No further major planned outages at San Juan due to pla
Slide 24: Liquidity as of October 27, 2020
Liquidity as of October 27, 2020 PNM Corporate/ Resources PNM TNMP Other Consolidated Financing Capacity(1): (In millions) • Available liquidity Revolving credit strengthened by the $440.0 $75.0 $340.0 $855.0 facilities issuance of long-term As of 10/27/20: debt at PNM and TNMP Short-term debt and i