Slide 1: Q2 2016 Earnings Review
Q2 2016 Earnings Review August 9, 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: Q2 2016 Financial Results and Company Updates
Q2 2016 Financial Results and Company Updates Financial Results: Q2 2016 Q2 2015 YTD 2016 YTD 2015 GAAP EPS $0.34 $0.40 $0.47 $0.57 Ongoing EPS $0.40 $0.44 $0.53 $0.65 EPS shown on a diluted basis 2016 Ongoing EPS Guidance narrowed to $1.55 - $1.65 Company Updates: General Rate Case update Hea
Slide 5: Regulatory Update
Regulatory Update Filing Action Timing Docket No. NMPRC: General Rate Case Filing Filed August 27, 2015 Recommended decision issued August 4, 2016; 15-00261-UT Rates expected to be implemented September 1, 2016 San Juan Generating Station Filed April 26, 2016 Hearing scheduled for November 7-10, 201
Slide 6: Financial Overview
Financial Overview Chuck Eldred Executive Vice President and CFO
Slide 7: Q2 2016 Financial Summary
Q2 2016 Financial Summary Ongoing EPS $0.44 ($0.05) ($0.02) $0.03 $0.40 PNM TNMP Corporate/ Other Q2 2015 Q2 2016 7
Slide 8: Load and Economic Conditions
Load and Economic Conditions Regulated Retail Energy Sales and Customers (weather-normalized, leap-year adjusted) % of 2015 Q2 2016 YTD 2016 % of 2015 % of 2015 Q2 2016 YTD 2016 PNM Sales vs. vs. TNMP Sales Sales vs. vs. Volumes Q2 2015 YTD 2015 Volumes Revenues Q2 2015 YTD 2015 Retail Load: Volumet
Slide 9: 2016 Guidance and Quarterly Distribution
2016 Guidance and Quarterly Distribution (Ongoing) Original 2016 Guidance Range: $1.55 Consolidated EPS $1.76 PNM TNMP Corp/Other $1.12 - $1.30 $0.49 - $0.51 ($0.06) – ($0.05) Narrowed 2016 Guidance Range: $1.55 Consolidated EPS $1.65 PNM TNMP Corp/Other $1.08 - $1.16 $0.50 - $0.51 ($0.03) – ($0.02)
Slide 10: Hearing Examiner General Rate Case Recommended Decision
Hearing Examiner General Rate Case Recommended Decision • Non-fuel revenue increase of $41.3M versus $121.5M request • Retail rate base of $2,223M versus $2,458M request Key Rate Case Elements Recommended Original Impact to (PNM Retail Share, net of ADIT) Decision Request Rate Increase ROE 9.575% 10
Slide 11: Questions and Answers
Questions and Answers
Slide 12: Appendix
Appendix
Slide 13: Q2 2016 vs Q2 2015 EPS (Ongoing): PNM
Q2 2016 vs Q2 2015 EPS (Ongoing): PNM PNM Q2 2016 Key Performance Drivers ∆ EPS $0.31 Elimination of Palo Verde Unit 2 lease costs, net of depreciation $0.03 $0.26 Weather $0.02 Interest income from IRS, net of fees $0.02 Outage costs $0.01 El Paso Natural Gas FERC tariff refund in 2015 ($0.03) Depr
Slide 14: Q2 2016 vs Q2 2015 EPS (Ongoing): TNMP and Corporate
Q2 2016 vs Q2 2015 EPS (Ongoing): TNMP and Corporate $0.15 TNMP $0.13 Q2 2016 Key Performance Drivers ∆ EPS Load $0.02 TCOS rate relief $0.01 O&M increases ($0.02) Q2 2015 Q2 2016 Weather ($0.01) Depreciation and property tax ($0.01) Other ($0.01) Corporate ($0.02) $0.01 Q2 2016 Key Performance Driv
Slide 15: Weather Impact
Weather Impact PNM Q2 2016 Q2 2015 2016 Normal(1) Heating Degree Days 360 354 301 Cooling Degree Days 504 417 495 Net EPS Impact $0.00 ($0.03) compared to normal TNMP Q2 2016 Q2 2015 2016 Normal(1) Heating Degree Days 39 45 56 Cooling Degree Days 928 983 1,083 Net EPS Impact ($0.02) ($0.01) compared
Slide 16: 2017 - 2019 Potential Earnings Power
2017 - 2019 Potential Earnings Power Last updated February 26, 2016 Allowed 2017 Earnings Potential 2018 Earnings Potential 2019 Earnings Potential Return / Equity Ratio Avg Rate EPS Avg Rate EPS Avg Rate EPS Base Base Base PNM Retail (1) 10% / 50% $2.4 B $1.50 $2.6 B $1.59 $2.5 B $1.58 PNM Renewabl
Slide 17: Capital Forecast
Capital Forecast 2016 – 2019 Total Capital Plan: $1.7B PNM 2015-2019 Rate Base CAGR: 5 - 7%(1) TNMP 2015-2019 Rate Base CAGR: 7 - 9% $568 (In millions) $37 Palo Verde Unit 3 added to rate base $125 $415 $398 $19 $14 $353 $113 $101 $15 $114 $117 $132 $102 $293 $127 $239 $240 $237 $203 $163 $168 $94 2
Slide 18: PNM Plant EAF and Outages
PNM Plant EAF and Outages 2016 - 2017 Outage Schedule 92.0% 91.8% Duration Time Unit in Days Period 70.4% 71.8% 72.3% Four Corners 60.7% 5 95 Q3-Q4 2017 Palo Verde 3 34 Q4 2016 2 34 Q2 2017 1 34 Q4 2017 San Juan Four Corners Palo Verde 12 months ending 6/30/15 12 months ending 6/30/16 18
Slide 19: Balance Sheet and Credit Metrics
Balance Sheet and Credit Metrics
Slide 20: Liquidity as of August 5, 2016
Liquidity as of August 5, 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 8/5/16: Short-term debt and LOC balances $105.4 $0.1 $184.7 $290.2 Remaining availability 344.6 74.9 115.3 534.8 Inves
Slide 21: Selected Balance Sheet Information
Selected Balance Sheet Information (In millions) Dec 31, 2015 June 30, 2016 Long-Term Debt (incl. current portion) (1) PNM $1,580.7 $1,631.6 TNMP 361.4 420.8 Corporate/Other 149.9 271.7 Consolidated $2,091.9 $2,324.0 Total Debt (incl. short-term) (2) PNM $1,580.7 $1,757.6 TNMP 420.4 450.8 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