Public Service Enterprise Group Incorporated · NYSE:PEG
Public Service Enterprise — Q1 2016 Earnings Presentation
17 slides from Public Service Enterprise's earnings presentation, May 2, 2016
Slide 1: Forward-Looking Statements
Forward-Looking Statements EXHIBIT 99 Certain of the matters discussed in this report about our and our subsidiaries' future performance, including, without limitation, future revenues, earnings, strategies, prospects, consequences and all other statements that are not purely historical constitute “
Slide 2: GAAP Disclaimer
GAAP Disclaimer PSEGpresents Operating Earnings in addition to its Income from Continuing Operations/Net Income reported in accordance with accounting principles generally accepted in the United States (GAAP).Operating Earnings is a non- GAAP financial measure that differs from Income from Continuin
Slide 3: Operating Earnings
Operating Earnings Disciplined investment program and focus on operational excellence have supported growth Operating Earnings* Contribution by Subsidiary Power’sdiverse fuel mix and dispatch flexibility continue to ** generate strong earnings and free cash flow in low price environment PSE&G’sinves
Slide 4: PSE&G's 2016 operating earnings to benefit from investment programs and cost control
PSE&G’s 2016 operating earnings to benefit from investment programs and cost control PSE&G Operating Earnings ($ Millions) $875 -- $925E $787 $725 2014 2015 2016 Guidance E =ESTIMATE. 37
Slide 5: Power's fleet to be transformed with addition of Keys, Sewaren 7 and Bridgeport Harbor
Power’s fleet to be transformed with addition of Keys, Sewaren 7 and Bridgeport Harbor in 2018-2019 Projected Fleet Comparison 2015 to 2020E 2020E Fuel Diversity* 2020E Energy Produced* 4% 1% Total MW: 13,100 <1% <1% Total GWh: 65,000 8% 18% 42% 48% 49% 29% 2015 Fuel Diversity* 2015 Energy Produced*
Slide 6: Power's 2016 operating earnings
Power’s 2016 operating earnings incorporates impact from abnormally warm weather and retirement of capacity Power Operating Earnings* ($ Millions) $642 $653 $490 – $540E 2014 2015 2016 Guidance *SEE SLIDE A FOR ITEMS EXCLUDED FROM NET INCOME TO RECONCILE TO OPERATING EARNINGS. E = ESTIMATE. 58
Slide 7: Market Review: Q1 2016 impacted by weather but forward prices retain seasonal volatility
Market Review:Q1 2016 impacted by weather but forward gas and electric prices retain seasonal volatility FORWARDS AS OF MARCH 31, 2016 62
Slide 8: Regulatory Framework: New capacity and energy market designs
Regulatory Framework: New capacity and energy market designs in PSEG’s core markets will better reward reliable generation units ISSUE /POLICY OUTCOME • Higher payments for enhanced reliability (Capacity Performance) and lower energy CAPACITY revenues have raised absolute and relative value of capac
Slide 9: Hedging Strategy: Designed to protect gross margin while leveraging the portfolio
Hedging Strategy: Designed to protect gross margin while leveraging the portfolio April-Dec 2016 2017 2018 Volume TWh 26 36 36 Base Load % Hedged 100% 75-80% 35-40% (Nuclear and Base Load Coal) Price $/MWh $49 $49 $49 Volume TWh 14 19 24 Intermediate Coal, Combined % Hedged 25-30% 0% 0% Cycle, Peaki
Slide 10: A higher regulated earnings mix
A higher regulated earnings mix due to growth in PSE&G earnings with a significant contribution from Power PSEG Operating Earnings $ Millions (except EPS) 2012 2013 2014 2015 2016E Guidance PSE&G $528 $612 $725 $787 $875 - $925 PSEG Power $663 $710 $642 $653 $490 - $540 Enterprise/Other $45 ($13) $3
Slide 11: Strong financial position to support our business initiatives in 2016 and beyond
Strong financial position to support our business initiatives in 2016 and beyond 2016 and Beyond Continuing strong earnings trend in 2016 with guidance Earnings of $2.80 to $3.00 per share Deploying significant capital at PSE&G for projects with contemporaneous returns Investment Pursuing Power proj
Slide 12: PSEG Summary
PSEG Summary • 2015 earnings of $2.91 were at the upper end of our upwardly revised operating earnings guidance of $2.85 -$2.95 per share • Forecast growth at PSE&G supports our 2016 guidance of $2.80 to $3.00 per share • Forecast high single-digit rate base growth at PSE&G on five year basis from 2
Slide 13: PSEG Financial Highlights
PSEG Financial Highlights Maintaining 2016 Operating Earnings* guidance of $2.80 - $3.00 per share Focused on maintaining operating efficiency and customer reliability Salem Q2 refueling outage extended to replace and repair baffle bolts in reactor vessel PSE&G expected to contribute over 60% of 201
Slide 14: Our balance sheet remains strong
Our balance sheet remains strong March 31, 2016 $ Billions PSEG PSE&G Power Cash and Cash Equivalents $0.6 $0.6 $0.0 Short Term Debt $0.0 $0.0 N/A Long Term Debt(2) 10.3 7.5 2.3 Common Equity 13.3 7.8 6.2 Total Capitalization $23.6 $15.3 $8.5 Total Debt / Capitalization 44% 49% 27% PSE&G Regulated E
Slide 15: PSEG Energy Holdings Investment Portfolio
PSEG Energy Holdings Investment Portfolio Investment Balance * at 03/31/16 Equipment ($millions) Merchant Energy Leases NRG REMA Keystone, Conemaugh & Shawville (PA) $ 355 3 coal-fired plants (1,162 equity MW) NRG Energy, Inc. / Midwest Gen** Powerton & Joliet Generating Stations (IL) $ 218 2 coal-f
Slide 16: Kathleen Lally
Kathleen Lally VICEPRESIDENT – INVESTOR RELATIONS PSEG SERVICES CORPORATION Kathleen A. Lallywas named vice president – investor relations of PSEG Services Corporation in January 2007. Prior to joining PSEG Ms. Lally was a portfolio manager at the investment firm of Angelo Gordon & Company. She has
Slide 17: Items Excluded from Income from Continuing Operations/Net Income to Reconcile to Operating Earnings
Items Excluded from Income from Continuing Operations/Net Income to Reconcile to Operating Earnings PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED For the Year Ended Reconciling Items, net of tax December 31, 2015 2014 2013 2012 2011 Earnings Impact ($ Millions) (Unaudited) Operating Earnings $ 1,476
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