Ameren Corporation · NYSE:AEE
Ameren — Non-Deal Roadshow (September 2021)
43 slides from Ameren's roadshow presentation, Sep 28, 2021
Slide 1: Leading the Way to a Sustainable Energy Future
Leading the Way to a Sustainable Energy Future Investor Meetings Late Sep. 2021
Slide 2: Cautionary Statements
Cautionary Statements Use of Non-GAAP Financial Measures In this presentation, Ameren has presented weather-normalized and core earnings per share, which are non-GAAP financial measures and may not be comparable to those of other companies. A reconciliation of GAAP to non-GAAP information is include
Slide 3: Company Description
Company Description Fully rate-regulated electric and natural gas utility Ameren Businesses 2.4M electric Ameren Missouri customers • Electric transmission, distribution, and generation business and a natural gas distribution business in Missouri regulated by MoPSC 0.9M gas • Serves 1.2 million elec
Slide 4: Our Value Proposition for Customers, Shareholders and the Environment
Our Value Proposition for Customers, Shareholders and the Environment Attractive dividend Strong long-term and strong long-term dividend Attractive total growth outlook growth outlook return potential • Expect 6% to 8% EPS CAGR 2021-20251,2 • Annualized equivalent dividend rate of • Track record of
Slide 5: Our Sustainability Value Proposition
Our Sustainability Value Proposition ENVIRONMENTAL SOCIAL IMPACT GOVERNANCE • Accelerating transition to a cleaner and • Delivering value to our customers in 2020 • Diverse BOD focused on strong oversight more diverse portfolio while focused on safety-first work culture – 62% women or racially/ethni
Slide 6: Delivering Strong Value to our Customers
Delivering Strong Value to our Customers Increased Customer Outage Improved Reliability1 Affordable Rates2 Frequency Satisfaction3 JD Power (per customer per year) +13% ¢/KWh Score +22% 1.00 Better 15 Better 766 750 0.80 0.89 13.15 13.14 734 731 723 0.77 700 0.60 10 10.11 690 9.93 650 663 0.40 651 5
Slide 7: Strong Track Record of EPS and Dividend Growth
Strong Track Record of EPS and Dividend Growth Weather-Normalized Core Weather-Normalized Dividends Paid per Share3 Earnings per Diluted Share1 Dividend Payout Ratio $3.75 +70% or $2.20 +25% $3.75 $2.20 $3.50 ~8% CAGR 2013 to 2020 $3.54 80% $3.25 2013 to 2020 $2.00 $3.32 $2.00 75% $3.00 $1.92 $3.05
Slide 8: Our Strategic Plan
Our Strategic Plan • Investing in and operating our utilities in a manner consistent with existing regulatory frameworks • Enhancing regulatory frameworks and advocating for responsible energy and economic policies • Creating and capitalizing on opportunities for investment for the benefit of our cu
Slide 9: Four Constructive Regulatory Frameworks
Four Constructive Regulatory Frameworks FERC-regulated: Formula ratemaking Ameren • Allowed ROE is 10.52%, includes MISO participation adder of 50 basis points; ~54% average equity ratio Transmission • Rates reset each Jan. 1 based on forward-looking calculation with annual reconciliation ICC-regula
Slide 10: Strong Rate Base Growth in All Regulatory Jurisdictions
Strong Rate Base Growth in All Regulatory Jurisdictions1 Robust five-year infrastructure investment plan in all segments $17.1 Billion of Regulated Infrastructure Investment 2020 to 2025E Regulated Five-Year Rate 2021-2025 Infrastructure Rate Base2 Base CAGR ($ billions) Ameren Illinois Ameren Illin
Slide 11: Expect to Deliver Strong Long-Term EPS and Dividend Growth
Expect to Deliver Strong Long-Term EPS and Dividend Growth • Expect 2021 EPS in a range of $3.65 to $3.851 Long-Term EPS Growth2 and • Remain on track to deliver strong long-term earnings growth 2021E EPS Guidance1 – Expect 6% to 8% EPS CAGR from 2021-20252 • Using 2021 EPS guidance range midpoint o
Slide 12: Expected 2021-2025 Funding Plan
Expected 2021-2025 Funding Plan1 • Cash from Operations – Return of capital through depreciation in rates – Return on equity-financed portion of rate base – ~$1.6 to $1.7 billion of income tax deferrals and tax asset utilization • Income tax deferrals driven primarily by capital expenditures • Inclu
Slide 13: Illinois Energy Legislation
Illinois Energy Legislation Enhancing regulatory frameworks and advocating for responsible energy and economic policies Ameren Illinois Electric Distribution • SB 2408 passed by General Assembly; signed by Governor – Electric utility may opt-in to four-year rate plan (Multi-Year Plan) for rates effe
Slide 14: Illinois Energy Legislation, Cont'd
Illinois Energy Legislation, Cont’d Enhancing regulatory frameworks and advocating for responsible energy and economic policies Ameren Illinois Electric Distribution – Four-year rate plan, cont’d • Rate impact to customers upon opt-in mitigated through ability to phase-in rates – At least 50% of fir
Slide 15: Illinois Energy Legislation, Cont'd
Illinois Energy Legislation, Cont’d Enhancing regulatory frameworks and advocating for responsible energy and economic policies Current Performance- Traditional Framework Multi-Year Plan Based Rates (Future Test Year) (Legislation) 5.80% + average of 30-year ROE treasury rate each calendar year ICC
Slide 16: Ameren Transmission Regulatory Matters
Ameren Transmission Regulatory Matters Enhancing regulatory frameworks and advocating for responsible energy and economic policies • In Apr. 2021, FERC issued supplemental NOPR that would remove incentive adder for utilities that have been members of an RTO for three years or more – Current allowed
Slide 17: MISO Long-Range Transmission Planning Roadmap
MISO Long-Range Transmission Planning Roadmap Creating and capitalizing on opportunities for investment for the benefit of our customers, shareholders and the environment • In Apr. 2021, MISO issued report outlining preliminary long-range transmission planning roadmap through 2039 – Generation resou
Slide 18: Missouri Renewable Energy Investments
Missouri Renewable Energy Investments Creating and capitalizing on opportunities for investment for the benefit of our customers, shareholders and the environment 400 MW High Prairie Renewable Energy 300 MW Atchison Renewable Energy Center located in northeast Missouri Center located in northwest Mi
Slide 19: Callaway Energy Center
Callaway Energy Center • During facility’s return to power in late Dec. 2020, a non-nuclear operating issue occurred related to its generator • Team executed plan and safely returned energy center to service on Aug. 4 – ~$60 million capital project – Insurance claims for capital project and replacem
Slide 20: Rush Island Energy Center
Rush Island Energy Center • On Aug. 20, 2021, US Court of Appeals affirmed the District Court’s Sep. 2019 order to install a flue gas desulfurization system at the Rush Island Energy Center, but reversed the District Court’s order to install a dry sorbent injection system at the Labadie Energy Cente
Slide 21: Ameren Missouri Generation Transformation
Ameren Missouri Generation Transformation Transition to a cleaner and more diverse portfolio in a responsible fashion 1 50% CARBON EMISSIONS 85% CARBON EMISSIONS NET-ZERO CARBON REDUCTION2 REDUCTION2 EMISSIONS2 • Ameren Missouri filed its preferred Integrated Resource Plan with the MoPSC in Sep. 202
Slide 22: Select Regulatory Items - Ameren Missouri
Select Regulatory Items - Ameren Missouri Electric Rate Review Procedural Schedule • In Mar. 2021, filed $299 million annual revenue increase request with MoPSC (Docket No. ER-2021- 0240): – ROE: 9.9% and equity ratio: 51.9%; Rate base: $10.0 billion (Sep. 30, 2021 estimate) – Test year ended Dec. 3
Slide 23: Select Regulatory Items - Ameren Missouri, Cont'd
Select Regulatory Items - Ameren Missouri, Cont’d Natural Gas Rate Review Procedural Schedule • In Mar. 2021, filed $9 million annual revenue increase request with MoPSC (Docket No. GR-2021- 0241): – Test year ended Dec. 31, 2020, with certain pro-forma adjustments through Sep. 30, 2021 Oct. 15, 202
Slide 24: Select Regulatory Items – Ameren Illinois
Select Regulatory Items – Ameren Illinois Electric Distribution • Requesting $59 million base rate increase from ICC in annual update – In Aug., ICC Staff recommended $58 million base rate increase – Expect ICC decision by Dec. 2021, with new rates effective in Jan. 2022 – Each year’s electric distr
Slide 25: Investing in the Energy Grid
Investing in the Energy Grid • Investing to modernize energy grid, making it cleaner, safer, more reliable, resilient and secure – Expect greater transmission investments to support additional renewable generation 2020-2025E Regulated – Provide customers with greater tools to manage energy usage Inf
Slide 26: Robust Investment Opportunities Across All Businesses Over Next Decade
Robust Investment Opportunities Across All Businesses Over Next Decade Modernizing the grid and investing in cleaner generation for the long-term benefit of customers, shareholders and the environment Additional Investment Investment Plan 2021-20251 Opportunities 2021-20301 $40B+ ($ billions) $23+ S
Slide 27: Summary
Summary Expect to deliver strong earnings growth in 2021 with guidance in a range of $3.65 to $3.85 per diluted share1 Successfully executing our strategy; well-positioned for future growth • Focused on delivering a cleaner and sustainable energy future in a responsible manner Strong long-term growt
Slide 28: Financial Update
Financial Update Ameren Missouri’s 400 MW High Prairie Renewable Energy Center placed in service Dec. 2020
Slide 29: 2021 Earnings Analysis for Six Months Ended June 30
2021 Earnings Analysis for Six Months Ended June 301 Key Earnings Variance Drivers ↑ Ameren Missouri earnings — New electric service rates effective Apr.1, 2020: ~+$0.10 — Higher electric retail sales: ~+$0.07 Diluted EPS • Weather vs. 2020: ~+$0.05; vs. normal ~+$0.02 YTD June 2020 vs. YTD June 202
Slide 30: 2021 EPS Guidance and Select Balance of the Year Considerations
2021 EPS Guidance and Select Balance of the Year Considerations1 • Reaffirmed 2021 diluted EPS guidance range of $3.65 to $3.85 2021E • Select considerations for Q3-Q4 2021 EPS compared to Q3-Q4 Diluted EPS 2020 EPS $3.85 – Ameren Missouri seasonal electric rate design effective in 2021 as a result
Slide 31: Published Sustainability Financing Framework
Published Sustainability Financing Framework • On June 2, Ameren published a Sustainability Financing Framework; one of the first utilities in the nation to do so – Framework supports Ameren’s sustainability goals and target of net-zero carbon emissions by 2050, as well as social initiatives – Allow
Slide 32: Financing and Liquidity Update
Ameren Credit Ratings Financing and Liquidity Update Debt Financing and External Debt Balances1 • On Mar. 5, Ameren Corporation issued $450 million of 1.75% senior unsecured notes due 2028 – Proceeds used for general corporate purposes and to repay short-term debt As of June 30, 2021 $ in millions M
Slide 33: Appendix
APPENDIX
Slide 34: Focused on Delivering Affordable Service to Our Customers
Focused on Delivering Affordable Service to Our Customers Residential rates since key legislative or regulatory enhancements Ameren Missouri Ameren Illinois Ameren Illinois Electric1,2 Electric Distribution3 Natural Gas Distribution3 ¢/KWh ~8.5% ¢/KWh ~3% $/therm ~2% 12.00 12.00 1.20 1.00 10.34 10.5
Slide 35: Focused on Disciplined Cost Management to Keep Customer Rates Affordable
Focused on Disciplined Cost Management to Keep Customer Rates Affordable • Continued focus on disciplined cost management from 2015 to 2020 Ameren – Total operating expenses decreased 14% Operating Expenses – Other non-fuel O&M expenses decreased 2% ($ millions) – Fuel and purchased power expenses d
Slide 36: Our Focus on Delivering a Cleaner Energy Future Responsibly
Our Focus on Delivering a Cleaner Energy Future Responsibly While providing safe, reliable and affordable energy to customers • Climate risk management and mitigation – Targeting significant reductions in greenhouse gases – Implementing robust customer energy efficiency programs – Investing to moder
Slide 37: Building a Brighter and Cleaner Energy Future
Building a Brighter and Cleaner Energy Future Innovative Programs to Meet Customer Needs and Rising Expectations Utility-owned solar Subscription program generation facilities for MO available to MO residential non-residential customer Neighborhood Community and small business parking lots, open lan
Slide 38: Ameren's Estimated Coal-Related Revenues in 2020
Ameren’s Estimated Coal-Related Revenues in 2020 Return on Investment Revenues Cost Recovery3 Revenues $2.1B1 x $2.1B1 x ($103M $423M + 52% x 48% x x 25%) / $161M x $147M + 9.53%2 = 4.5% = (1 - 25%) 26%1 = $154M = $103M $45M $34M $42M $724M $5,794M 16% Return on Interest Tax Expense Property Fuel, o
Slide 39: GAAP to Core Earnings Per Share Reconciliations
GAAP to Core Earnings Per Share Reconciliations Year Ended Dec. 31, 2013 2014 2015 2016 2017 2018 2019 2020 GAAP Earnings / Diluted EPS $1.18 $2.40 $2.59 $2.68 $2.14 $3.32 $3.35 $3.50 Exclude results from discontinued operations 0.87 — (0.01) — — — — — Less: Income tax benefit / expense 0.05 — (0.20
Slide 40: Weather-Normalized Earnings per Share Reconciliations
Weather-Normalized Earnings per Share Reconciliations Year Ended Dec. 31, 2013 2014 2015 2016 2017 2018 2019 2020 Core1 Diluted EPS $2.10 $2.40 $2.56 $2.68 $2.83 $3.37 $3.35 $3.50 Ameren Missouri weather impact included in Electric 0.03 0.05 (0.04) 0.16 (0.07) 0.43 0.04 (0.05) Margins Less: Income t
Slide 41: Investor Relations Calendar
Investor Relations Calendar LATE SEP. / OCT. 2021 NOV. 2021 SUN. MON. TUES. WED. THUR. FRI. SAT. SUN. MON. TUES. WED. THUR. FRI. SAT. Sep. 26 27 28 29 30 Oct. 1 2 1 2 3 4 5 6 Wolfe Boston Q3 Quiet Q3 Virtual Investor Period, Earnings Conf. Meetings cont’d Conf. Call 3 4 5 6 7 8 9 7 8 9 10 11 12 13 E
Slide 42: Select Regulatory and Legislative Matters
Select Regulatory and Legislative Matters Missouri Public Service Commission • Pending electric rate review filling: Docket No. ER-2021-0240 • Pending natural gas rate review filing: Docket No. GR-2021-0241 • Smart Energy Plan filing: Docket No. EO-2019-0044 • 2020 Integrated Resource Plan: Docket N
Slide 43: Glossary of Terms and Abbreviations
Glossary of Terms and Abbreviations AFUDC – Allowance for funds used during construction ISRS – Infrastructure System Replacement Surcharge ATXI – Ameren Transmission Company of Illinois M – Million B – Billion MEEIA – Missouri Energy Efficiency Investment Act bps – Basis points MISO – Midcontinent