Dominion Energy, Inc. · NYSE:D
Dominion Energy — Q2 2020 Earnings Presentation
35 slides from Dominion Energy's earnings presentation, Jul 31, 2020
Slide 1: Q2 2020 earnings call
Q2 2020 earnings call July 31, 2020 Please refer to page 2 for risks and uncertainties related to projections and forward looking statements
Slide 2: Important note for investors
Important note for investors This presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding Dominion Energy. The statements relate to, among other things, expectations, estimates and projections concerning the busine
Slide 3: Operating earnings per share: Q2 2020 actual vs. guidance
Operating earnings per share Actual vs. guidance Second quarter 2020 (not adjusted for discontinued operations) $0.85 $0.85 $0.82 18 straight quarters of weather-normalized Unfavorable $0.75 $0.75 results that meet or weather impact on utility earnings: exceed the midpoint of ($0.03) our quarterly g
Slide 4: Operating earnings per share: Q3 and full-year 2020
Operating earnings per share Actual vs. guidance Third quarter 2020 Full-year 2020 $1.05 $3.63 $3.37 Q3 2019 results 2019 full-year $0.85 adjusted for results adjusted Reflects discontinued for discontinued discontinued Reflects operations will be operations will be operations discontinued provided
Slide 5: Dom Zone weather-normalized load
Dom Zone weather-normalized load Daily electric sales volume vs. 2018/19 average (through July 28) 12.0% Mar 11: Mar 23: Closure of schools and May 15: Partial Jun 5: Jul 1: 10.0% Pandemic non-essential businesses; reopening Phase 2 Phase 3 8.0% declared gatherings over 10 people banned commences re
Slide 6: DESC weather-normalized load
DESC weather-normalized load Daily electric sales volume vs. 2018/19 average (through July 28) Mar 11: Mar 31: Closure of May 4: Partial May 22: Jun 11: 12.0% Pandemic non-essential reopening Additional Additional declared businesses commences reopening reopening 8.0% 4.0% 0.0% (4.0%) (8.0%) (12.0%)
Slide 7: Financing
Financing Equity capital market financing activities¹ 2020 2021 2022 2023 2024 DRIP $160M $300M $300M $300M $300M At-the-market (“ATM”) 0 0 0—200M 100—300M 300—500M Total $160M $300M $300—$500M $400—$600M $600—$800M ▪ Ceasing new share issuance under DRIP in 2020 ▪ Resumes “steady-state” level of ~$
Slide 8: Investor relations
Investor relations ▪ Proactive outreach: Virtual non-deal roadshows and investor conferences ▪ Targeted geographies: North America, Europe, Australia ▪ Existing and prospective shareholders ▪ Additional investor targeting ▪ Investment strategies that align with D’s pro forma operational and financia
Slide 9: Social—Employee safety
Environmental, social, and governance Social—Employee safety OSHA recordable incident rate¹ ~40% better than 2019 100 employees each work year 1.78 record Number of recordables per performance 1.44 1.34 1.32 1.06 1.02 1.04 1.00 0.92 0.88 0.80 0.65 0.68 0.62 0.36 2006 2007 2008 2009 2010 2011 2012 20
Slide 10: Social—Community giving
Environmental, social, and governance Social—Community giving Dominion Energy commits $35 million to initiative supporting historically black Commentary colleges and universities, minority student scholarships ▪ HBCU recipients across Virginia, Ohio, North and South Carolina representing ~35,000 enr
Slide 11: 'Pure-play' state-regulated, sustainability-focused utilities
‘Pure-play’ state-regulated, sustainability-focused utilities Repositioned strategy Premier state-regulated utility operations Industry-leading clean energy profile Increased long-term earnings and dividend growth Low-risk business profile and healthy balance sheet Narrowed focus enhances consistenc
Slide 12: Environmental, social, and governance: Environmental
Environmental, social, and governance Environmental Enterprise-wide projected renewable generation capacity 3rd largest utility company owner of solar in U.S. 28.3GW 3,000MW renewable goal ✓ achieved ahead of schedule 12MW OSW test project initial electric generation in Q3 100% renewable tariff 100%
Slide 13: Summary
Summary ✓ On-track for best safety performance ever ✓ Commitments to social justice and underrepresented minority students ✓ 18th consecutive quarter of weather-normal earnings at or above guidance midpoint ✓ Affirmed enhanced long-term earnings and dividend growth ✓ Transaction with Berkshire Hatha
Slide 14: Appendix
Appendix Please refer to page 2 for risks and uncertainties related to projections and forward looking statements
Slide 15: Operating earnings per share: track-record of successful execution
Operating earnings per share Track-record of successful execution Weather normalized operating EPS vs. guidance Upper end guidance Guidance midpoint Lower end guidance 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q
Slide 16: Operating segments
Operating segments Pro forma for elimination of Gas Transmission and Storage segment State-regulated utility operations Regulated-like Dominion Energy Dominion Energy Contracted Gas Distribution Assets Virginia South Carolina (formerly Contracted Generation) CT OH UT VA ID States of operation WY WV
Slide 17: State-regulated utilities
State-regulated utilities Customers Segment summary as of 6/30/2020 State summary Six months ended DE Customers June 30 South Carolina 6/30/2020 (M) Gas Distribution ‘18-’20 CAGR 1.2M 3.0M 17% DE Virginia 1.2% 2.7 44% DE South Carolina 2.3% 1.2 Electric 1.8% 0.8 6.8M Gas 3.4% 0.4 state utility Gas D
Slide 18: Environmental: Zero and low carbon electric generation
Environmental, social, and governance Environmental: Zero and low carbon electric generation Electric generation by fuel type (MWH) Future: Past: Present: 2035 2005 2019 (est) Hydro, Solar, Wind 1% 4% 33% ~68% zero carbon Nuclear 36% 42% 35% ~94% zero/low Natural gas 7% 42% 26% carbon Coal 52% 12% 6
Slide 19: Environmental: Solar portfolio
Environmental, social, and governance Environmental: Solar portfolio Progress towards Virginia goals Approximate values In service In development Total % of In Virginia 622 MW 2,451 MW 3,073 MW Goal Toward VCEA MW Goal in VA1 334 MW 2,713 MW 3,047 MW 18.9% Toward 3,000 MW Goal in VA2 232 MW 3,055 MW
Slide 20: Governance: Transparency
Environmental, social, and governance Governance: Transparency 2019 CPA-Zicklin Index of Corporate Political Disclosure and Accountability 91.4 “Trendsetter” 69.6 ~15% of S&P 500 companies 47.1 “The Center for Political Accountability (CPA) is a non-profit, non-partisan organization working to bring
Slide 21: Operating earnings per share: pro forma guidance
Operating earnings per share¹ Pro forma guidance Original 2020E Updated 2020 Changes guidance² guidance² DEV DESC $2.89—$3.11 Gas Corp & (Slide 7 of Q4 2019 — $2.89—$3.11 earnings materials) Distribution Other Contracted Assets (+) 50% retained interest in $0.24—$0.28 $0.48—$0.52 (previously Contrac
Slide 22: Operating earnings per share: pro forma guidance
Operating earnings per share¹ Pro forma guidance ~10%—11% ~6.5% growth annual EPS ~$3.85—$3.90² growth ~$3.50² ✓ Utility-focused, predictable and Includes programmatic investment estimated full- profile year impact of planned share ✓ ESG, customer growth and repurchases reliability-driven rate base
Slide 23: Weather: after-tax impacts
Weather After-tax impacts ($M) Q1 Q2 Q3 Q4 2020 YTD Dominion Energy Virginia2 ($58) ($16) — — ($73) Versus normal¹ Dominion Energy South Carolina3 (9) (9) — — (18) Gas Distribution4 (5) 2 — — (4) Total ($72) ($23) — — ($95) Q1 Q2 Q3 Q4 2020 YTD Dominion Energy Virginia2 ($26) ($22) — — ($48) Versus
Slide 24: Weather: degree days
Weather Degree days Quarter ended 6/30 Six months ended 6/30 2020 2019 2020 2019 Actual 371 150 1,889 2,042 Heating Dominion Energy Normal 290 280 2,280 2,268 Virginia Actual 438 644 452 649 Cooling Electric Normal 488 504 493 508 Actual 33 38 610 698 Heating Dominion Energy South Normal 27 28 828 8
Slide 25: Dividends per share
Dividends per share Pro forma guidance All dividend declarations subject to Board approval Rebasing reflects ~6% asset sale + normalized payout annual ~$3.45 DPS growth Q1 (Mar): $0.94 ~$2.50 Q2 (Jun): $0.94 Est. Q3 (Sep): $0.94 ✓ Rebased dividend reflects revised operating Target dividend Est. Q4 (
Slide 26: Fixed income: long-term debt financings
Financing Fixed income Estimated long-term debt financings (remainder of 2020)1 Maturities Gross issuance Net issuance VEPCO2 $0M $800—$1,000M $800—$1,000M Other 300 0 ($300) Total $300M $800—$1,000M $500—$700M ▪ Credit agencies: Supportive of de-risking benefits from ▪ Total liquidity—$6.8B strateg
Slide 27: Fixed income: long-term debt by segment
Fixed income Long-term debt by segment (as of June 30, 2020) $14.4 $34.4 Total debt ($B)¹ $3.4 $0.9 $3.4 $12.4 Segment Dominion Dominion Gas Contracted Corporate and Energy Energy Total Distribution Generation Other Virginia South Carolina VEPCO ✓ DEO DESC ✓ Solar entities DEI ✓ Financing entities Q
Slide 28: Fixed income: schedule of debt maturities
Fixed income Schedule of debt maturities as of June 30, 2020 ($M) Please refer to page 2 for risks and uncertainties related to projections and forward looking statements 28
Slide 29: Fixed income: schedule of debt maturities
Fixed income Schedule of debt maturities as of June 30, 2020 ($M) ¹ Excludes finance leases Please refer to page 2 for risks and uncertainties related to projections and forward looking statements 29
Slide 30: Fixed income: schedule of long-term debt
Fixed income Schedule of long-term debt ($M, preliminary & unaudited) Segment Segment Financing Entity Financing Entity Description Description Maturity Maturity Weighted Avg.Avg. Weighted RateRate Short-term at 6/30/2020 Short-term Long-term at 6/30/2020 at 6/30/2020 Long-term at 6/30/2020 DE Virgi
Slide 31: Fixed income: credit ratings
Fixed income Credit ratings Dominion Energy, Inc. Moody’s S&P Fitch Corporate/Issuer Baa2 BBB+ BBB+ Senior Unsecured Debt Securities Baa2 BBB BBB+ Junior Subordinated Notes Baa3 BBB BBB Enhanced Junior Subordinated Notes Baa3 BBB- BBB- Preferred Stock Ba1 BBB- BBB- Short-Term/Commercial Paper P-2 A-
Slide 32: Fixed income: credit ratings (cont'd)
Fixed income Credit ratings (cont’d) Dominion Energy Ohio Moody’s S&P Fitch Corporate/Issuer A2 BBB+ A- Senior Unsecured Debt Securities A2 BBB+ A Outlook Stable Positive Stable DESC Moody’s S&P Fitch Corporate/Issuer Baa2 BBB+ BBB+ First Mortgage Bonds A3 A A Short-Term/Commercial Paper P-2 A-2 F2
Slide 33: Pension
Pension Consolidated funded status as of year-end¹ Commentary ▪ Remeasured at year-end 92% ▪ Plan assets (through June) up ~3% inclusive of hedge strategy ▪ Voluntary contribution of $250M 85% expected late 2020 ▪ Disclosed in July 5 materials as use of proceeds from GT&S divestiture ▪ No other anti
Slide 34: Contracted generation: 2020 Millstone energy position
Contracted generation 2020 Millstone energy position Millstone hedging as of July 20, 2020 9% open 1.4M MWh 56% long-term 15.6M contracted MWh in 8.7M MWh 36% hedged 2020 $49.99 5.6M MWh $36.35 ~92% of 2020 volumes de-risked at volume weighted average price of $41.08 Please refer to page 2 for risks
Slide 35: Sales sensitivities
Sales sensitivities 2020 operating EPS impact for 1% (full-year) change in electric sales¹ DEV DESC Residential +/- $0.015 Residential +/- < $0.01 Commercial +/- $0.01 All other +/- < $0.01 All other +/- < $0.01 ¹ Reflects only direct sales impact Please refer to page 2 for risks and uncertainties r