Centerpoint Energy, Inc (holding Co) · NYSE:CNP
Centerpoint Energy, Inc (holding Co) — Q3 2016 Earnings Presentation
21 slides from Centerpoint Energy, Inc (holding Co)'s earnings presentation, Nov 4, 2016
Slide 1: 3rd Quarter 2016 Earnings Call
3rd Quarter 2016 Earnings Call • Third quarter 2016 earnings of $0.41 per diluted share • Full year guidance updated to $1.16 - $1.20 • Strong utility performance driven by customer growth and rate relief • M idstream Investments expected to contribute earnings at the high end of the $0.24 - $0.28 g
Slide 2: Cautionary Statement
Cautionary Statement This presentation and the oral statements made in connection herewith contain statements concerning our expectations, beliefs , plans, objectives, goals, strategies, future operations, events, financial position, earnings, growth, costs, prospects, capital investments or perform
Slide 3: Earnings Call Highlights: CEO Scott Prochazka
Scott Prochazka – President and CEO Earnings Call Highlights Third Quarter Performance Enable Midstream Highlights Full-Year Outlook investors.centerpointenergy.com 3
Slide 4: Third Quarter 2016 Performance Highlights
Third Quarter 2016 Performance Highlights Q3 EPS Third quarter 2016 EPS of $0.41, compared with third quarter 2015 EPS loss of $0.91, Q3 2016 vs Q3 2015 Drivers (2) that included impairment charges totaling $1.25 per share related to the equity h Customer Growth i Depreciation investment in Enable M
Slide 5: Highlights from Enable Midstream's Earnings Call on Nov. 2, 2016
Highlights from Enable Midstream’s Earnings Call on Nov. 2, 2016 Dedicated rig count increased over 13% during the 3rd quarter (1) Enable continues to achieve commercial success and is well-positioned to meet customers needs through integrated midstream solutions Quarterly natural gas gathered
Slide 6: CenterPoint Energy Full-Year Outlook
CenterPoint Energy Full-Year Outlook 2016 Guidance Range vs. 2015 EPS on a Guidance (Non-GAAP) Basis (1) $1.12 - $1.20 $1.16 - $1.20 $1.10 2015 2016 2016 Actual Initial Revised (released Feb. 1, 2016) (updated Nov. 4, 2016) Focus continues to be on investing in our utility service territories to a
Slide 7: Earnings Call Highlights: Electric Division
Tracy Bridge – EVP & President, Electric Division Earnings Call Highlights Houston Electric Results Houston Electric Regulatory Update Construction of a new 345kV double circuit tower investors.centerpointenergy.com 7
Slide 8: Electric Transmission and Distribution Operating Income Drivers
Electric Transmission and Distribution Operating Income Drivers: Q3 2015 vs Q3 2016 $250 $7 $245 $10 $240 $235 $11 ($13) $ Millions $230 $225 $220 $234 2% YoY $215 Customer $219 Growth (1) $210 $205 (3) Q3 2015 TDU Core Rate relief Customer growth Other (4) Depreciation and Q3 2016 TDU Core Operatin
Slide 9: Electric Transmission and Distribution Q3 2016 Regulatory Update
Electric Transmission and Distribution Q3 2016 Regulatory Update Annualized DCRF revenue requirement: $45.0 million Annual DCRF Revenue Mechanism Effective Date Comments Docket # Requirement ($MM) Filed in April 2016; settlement approved by the PUCT in June 2016 provides for an annualized DCRF reven
Slide 10: Earnings Call Highlights: Gas Division
Joe McGoldrick – EVP & President, Gas Division Earnings Call Highlights Natural Gas Distribution Results Natural Gas Distribution Regulatory Update Energy Services Results Atmos Energy Marketing (AEM) Acquisition 2015 Minnesota Beltline Replacement Project in downtown Minneapolis investors.c
Slide 11: Natural Gas Distribution Operating Income Drivers
Natural Gas Distribution Operating Income Drivers: Q3 2015 vs Q3 2016 $30 $16 $25 ($3) ($2) $20 $ Millions $15 $22 $10 1% YoY $5 $11 Customer Growth (1) $0 (4) Q3 2015 Natural Gas Rate relief and Depreciation and taxes (3) O&M Q3 2016 Natural Gas Distribution Operating customer growth (2) Distributi
Slide 12: Natural Gas Distribution Q3 2016 Regulatory Update
Natural Gas Distribution Q3 2016 Regulatory Update Annualized rate relief from filings completed in 2016: $62.6 million Annual Increase Jurisdictions Effective Date Comments Docket # ($MM) Houston 10508 South Texas Annual GRIP filings submitted in March 2016; 10509 July 2016 $18.2 Beaumont/East Texa
Slide 13: Natural Gas Distribution Q3 2016 Regulatory Update
Natural Gas Distribution Q3 2016 Regulatory Update Energy efficiency incentives recognized in 2016: $12.7 million Annual Jurisdiction Effective Date Performance Comments Docket # Incentive ($MM) MPUC approved CIP incentive in September 2016; Minnesota September 2016 $12.7 (1) G008/M-16-366 recognize
Slide 14: Energy Services
Energy Services Third Quarter Operating Income Operating income was $7 million for the third quarter 2016 compared to $2 million for the same period last year, excluding a mark-to-market loss of $2 million and a gain of $5 million, respectively Agreement to acquire Atmos Energy Marketing (AEM)
Slide 15: Earnings Call Highlights: CFO Bill Rogers
Bill Rogers – EVP & CFO Earnings Call Highlights Third Quarter Earnings Financing, Interest Expense & Tax Strategic Review Update investors.centerpointenergy.com 15
Slide 16: Reconciliation: Net Income and Diluted EPS to Adjusted Net Income and Adjusted Diluted EPS
Reconciliation: Net Income (Loss) and Diluted EPS to Adjusted Net Income and Adjusted Diluted EPS Used in Providing Annual Earnings Guidance Quarter Ended September 30, 2016 September 30, 2015 Net Income Net Income (in millions) Diluted EPS (in millions) Diluted EPS Consolidated as reported $ 179 $
Slide 17: Financing, Interest Expense and Tax
Financing, Interest Expense and Tax Liquidity and Capital Resources Long-term Debt Maturities ($MM) (1) Anticipate strong balance sheet and cash flow $700 Net incremental borrowings of ~$100 million expected for $600 2016, inclusive of funding for the acquisition of the retail $500 energy serv
Slide 18: Enable Strategic Review Update
Enable Strategic Review Update Criteria for Consideration of a Sale or Spin – sustainable value for our long-term shareholders Comparable earnings per share and dividends Improve visibility and certainty of future earnings Seek to maintain current credit ratings Ongoing Activities Continuing
Slide 19: Appendix
Appendix investors.centerpointenergy.com 19
Slide 20: Reconciliation: Operating Income to Core Operating Income on a Guidance Basis
Reconciliation: Operating Income to Core Operating Income on a Guidance (Non-GAAP) Basis Quarter Ended Quarter Ended Difference Operating Income ($ in millions) September 30, 2016 September 30, 2015 Fav/(Unfav) Electric Transmission and Distribution $ 257 $ 244 $ 13 Transition and System Restoration
Slide 21: Reconciliation: Net Income and Diluted EPS to Adjusted Net Income and Adjusted Diluted EPS
Reconciliation: Net Income (Loss) and Diluted EPS to Adjusted Net Income and Adjusted Diluted EPS Used in Providing Annual Earnings Guidance Twelve Months Ended December 31, 2015 Net Income Diluted (in millions) EPS Consolidated as reported $ (692) $ (1.61) Midstream Investments 1,024 2.38 Utility O