Duke Energy Corporation (Holding Company) · NYSE:DUK
Duke Energy Corporation (Holding Company) — Q1 2007 Earnings Presentation
24 slides from Duke Energy Corporation (Holding Company)'s earnings presentation, May 8, 2007
Slide 1: First Quarter Earnings Review
First Quarter Earnings Review May 8, 2007 . “9 Jim-Rogers Chairman, President-and Chief Executive Officer f E ) Group Executive and Chief Financial Officer j vid Hauser |
Slide 2: Safe Harbor Statement
Safe Harbor Statement Some of the statements in this document concerning future company performance will be forward-looking within the meanings of the securities laws. Actual results may materially differ from those discussed in these forward-looking statements, and you should refer to the additiona
Slide 3: Earnings Summary
Earnings Summary 1Q07 1Q06 DUK Reported Diluted Earnings per Share $ 0.28 $ 0.37 Special Items 0.03 - Discontinued Operations (0.01) (0.16) DUK Ongoing Diluted Earnings per Share $ 0.30 $ 0.21 Increase in ongoing earnings from: Addition of Midwest assets at FE&G and Commercial Power Improvemen
Slide 4: U.S. Franchised Electric & Gas
U.S. Franchised Electric & Gas Reported & Ongoing Segment EBIT ($ millions) 1Q07 1Q06 Reported Segment EBIT $ 574 $ 359 Special Items - - Ongoing Segment EBIT $ 574 $ 359 1Q07 segment EBIT increased by $215 million over 1Q06 The addition of Cinergy’s regulated utilities in the Midwest contribute
Slide 5: U.S. Franchised Electric & Gas (cont.)
U.S. Franchised Electric & Gas (cont.) Merger-Related Rate Reductions ($ millions) 2006 1Q07 2Q07 3Q07 Thereafter Total2 Actual Actual Est. Est. North Carolina $ 66 $ 29 $ 27 $ 6 $ - $ 128 South Carolina 23 9 6 - - 39 Indiana 27 12 3 - - 42 Ohio1 14 1 - - - 15 Kentucky 2 <1 <1 <1 7 11 Total2 $ 132 $
Slide 6: Commercial Power
Commercial Power Reported & Ongoing Segment EBIT ($ millions) 1Q07 1Q06 Reported Segment EBIT (Loss) $ (9) $ (26) Special Items - - Ongoing Segment EBIT (Loss) $ (9) $ (26) 1Q07 segment EBIT losses improved $17 million over 1Q06 Cinergy’s non-regulated generation fleet added $107 million offset
Slide 7: International Energy
International Energy Reported & Ongoing Segment EBIT ($ millions) 1Q07 1Q06 Reported Segment EBIT $ 94 $ 86 Special Items - - Ongoing Segment EBIT $ 94 $ 86 1Q07 segment EBIT increased $8 million compared to 1Q06 Increase primarily due to: Favorable energy prices in Brazil Positive foreign c
Slide 8: Crescent Resources
Crescent Resources Reported & Ongoing Segment EBIT ($ millions) 1Q07 1Q06 Reported Segment EBIT $2 $ 42 Special Items - - Ongoing Segment EBIT $2 $ 42 1Q07 segment results declined compared to 1Q06 due to the following: 1Q07 results represent Duke’s effective 50% ownership Lower lot and land s
Slide 9: Other
Other Reported & Ongoing EBIT ($ millions) 1Q07 1Q06 Reported EBIT (Loss) $ (84) $ (54) Special Items 32 5 Ongoing EBIT (Loss) $ (52) $ (49) 1Q07 ongoing EBIT losses were essentially flat compared to 1Q06 Special items include: $21 million in convertible debt charges related to the Spectra spi
Slide 10: Other Items
Other Items Net cash balance of approximately $1.4 billion on 3/31/07 Cash, cash equivalents and short-term investments net of commercial paper Interest expense for the quarter was $164 million compared to $103 million for 1Q06; increase primarily due to the Cinergy merger Reduction in effec
Slide 11: Earnings Growth Drivers
Earnings Growth Drivers Enhanced Cost Significant Capital Steady Sales Growth Reductions Reinvestment Annual load growth Consistent focus on $9 billion in regulated 1.5% in Carolinas cost control CapEx through 2009 1.0% in Midwest Ahead of merger Current focus on ~65,000 new plan reg
Slide 12: Regulatory and Legislative Initiatives
Regulatory and Legislative Initiatives Nuclear Construction and Operating Cliffside License (COL) Received approval for 800 MW Expect to file COL for Lee Nuclear Station 2,120 MW of new generation required in the this fall Carolinas by 2011 Southern Company will not participate ~1,300 MW n
Slide 13: Regulatory and Legislative Initiatives (cont'd.)
Regulatory and Legislative Initiatives (cont’d.) IGCC Front-End Engineering and Renewable Energy RFP Design (“FEED”) Study Filed with Indiana Commission in April Seeking bids in North Carolina for renewable energy $2 billion cost estimate in line with EPRI Includes solar, wind, hydro and bio
Slide 14: Regulatory and Legislative Initiatives (cont'd.)
Regulatory and Legislative Initiatives (cont’d.) New Generation Cost Recovery Energy Efficiency (Carolinas) Filed proposal in NC to expand energy SC passed legislation efficiency programs Cost recovery assurance for new The “fifth fuel” nuclear and coal Model to create financial incentives
Slide 15: Regulatory and Legislative Initiatives (cont'd.)
Regulatory and Legislative Initiatives (cont’d.) Ohio Regulatory New Source Review 1,500 MW currently needed Supreme Court overturned lower court rulings regarding hourly standard RSP expires in 2008 Case expected to return to lower Amending proposal to extend RSP courts 5 – 10 years D
Slide 16: NC Rate Review
NC Rate Review 1991-2005 Cost Increase / (Decrease) – Nominal Dollars Condition of the Cinergy merger 158% Consumer Goods 150% Percent Change First rate review case in 110% 90% 80% 16 years 70% 47% 43% 41% 38% 30% 20% -9% Base rates unchanged since 1991 -10% Electricity Transportation CPI Natu
Slide 17: Value Proposition
Value Proposition Growth Annual Total Return Profile Sales growth 15% Cost reductions Return on capital investments Value 10% Proactive regulatory strategy 2007 EPS incentive target of $1.15 per share, based on ongoing 5% diluted EPS 4-6% ongoing diluted EPS growth through 2009 0% EP
Slide 18: Slide 18
Slide 19: Non-GAAP Reconciliations First Quarter 2007 Earnings Review
Duke Energy Corporation Non-GAAP Reconciliations First Quarter 2007 Earnings Review May 8, 2007 Ongoing Diluted Earnings per Share (“EPS”) The slides and prepared remarks for Duke Energy Corporation’s (“Duke Energy”) First Quarter 2007 Earnings Review include a discussion of ongoing diluted EPS for
Slide 20: Ongoing Diluted EPS Growth Rates through 2009
Ongoing Diluted EPS Growth Rates through 2009 The slides and prepared remarks for Duke Energy’s First Quarter 2007 Earnings Review include a discussion of the expected range of growth in ongoing diluted EPS through 2009. These percentages are based on anticipated ongoing diluted EPS amounts for futu
Slide 21: Ongoing to Reported Earnings Reconciliation March 2006 Year-to-date
DUKE ENERGY CORPORATION ONGOING TO REPORTED EARNINGS RECONCILIATION March 2006 Year-to-date (Dollars in millions, except per-share amounts) Special Items (Note 1) Costs to Ongoing Discontinued Total Reported Achieve, Earnings Operations Adjustments Earnings Cinergy Merger SEGMENT EARNINGS BEFORE INT
Slide 22: Ongoing to Reported Earnings Reconciliation March 2007 Year-to-date
DUKE ENERGY CORPORATION ONGOING TO REPORTED EARNINGS RECONCILIATION March 2007 Year-to-date (Dollars in millions, except per-share amounts) Special Items (Note 1) Costs to Convertible Achieve, Ongoing Debt Costs, Cinergy Discontinued Total Reported Earnings Gas Spin-off Merger Operations Adjustments
Slide 23: Net Cash Balance Reconciliation
Duke Energy Corporation Net Cash Balance Reconciliation As of March 31, 2007 (Dollars in millions) Cash and Cash Equivalents $570 Short-Term Investments 1,256 Subtotal 1,826 Short-term Commercial Paper Outstanding (424) Net Cash Balance $1,402 (Approximately $1.4 billion) Note: The net cash balance
Slide 24: First Quarter 2006 Combined Duke Energy and Cinergy Ongoing Results
Duke Energy Corporation First Quarter 2006 Combined Duke Energy and Cinergy Ongoing Results (in millions, except conversion ratio and per share amounts) Q1 2006 Cinergy Duke Energy Total Reported Special Items Ongoing (a) Ongoing (b) Ongoing Segment EBIT: U.S. Franchised Electric & Gas $167 $167 $35