Txnm Energy, Inc. · NYSE:TXNM
Txnm Energy — PNM Resources — Q2 2022 Earnings Presentation
23 slides from Txnm Energy's earnings presentation, Aug 4, 2022
Slide 1: Q2 2022 Earnings Review
Q2 2022 Earnings Review August 4, 2022
Slide 2: Contact Information and Safe Harbor Statement
Contact Information and Safe Harbor Statement Investor Relations Contact Information Lisa Goodman Executive Director, Investor Relations and Shareholder Services 1-505-241-2160 Lisa.Goodman@pnmresources.com Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 Statements m
Slide 3: Overview and Highlights
Overview and Highlights
Slide 4: Financial Highlights and Strategic Updates
Financial Highlights and Strategic Updates Financial Results and Guidance Q2 2022 earnings results Q2 2022 Q2 2021 YTD 2022 YTD 2021 Clean $0.18 GAAP EPS Energy $0.62 Strong $0.36 Financial $0.83 Ongoing EPSFocus $0.57 $0.55 $1.08 $0.88 2022 and 2023 earnings Profile • 2022 Ongoing EPS Guidance affi
Slide 5: Q2 2022 ESG Highlights
Q2 2022 ESG Highlights CO2 PNM Joins EPRI Retirement of Power of Climate READi™ San Juan Unit 1 Partnerships Initiative • PNM retired Unit 1 of the • Climate READi™: Power • PNM partnering with UNM San Juan Generating Station (REsilience and ADaptation to expand internship on June 30, 2022 initiativ
Slide 6: Operational and Regulatory Updates
Operational and Regulatory Updates
Slide 7: Executing the Transition to Clean Energy
Executing the Transition to Clean Energy Measured, Multifaceted Approach to PNM’s Clean Energy Transition Environmental Balancing Community Benefits Customer Rates Support Accelerated Exit from Coal: New Mexico Energy Retirement of Transition Act: Retirement of Exit from Four landmark energy legisla
Slide 8: Load and Economic Conditions
Load and Economic Conditions PNM New system peak despite delayed growth from Industrial customers PNM Q2 YTD 2022E 2022 vs 2021 • Industrial load is growing slower than expected • Combined Residential and Commercial load is Total Retail Load(1) 0.8% 2% – 3% slightly ahead of expectations PNM Avg. Cu
Slide 9: PNM and TNMP Key Regulatory Proceedings
PNM and TNMP Key Regulatory Proceedings PNM NMPRC Current: Merger, San Juan and Four Corners Abandonment/Securitization appeals with New Mexico Supreme Court ` Upcoming: • Q4 2022 Grid modernization filing • Q4 2022 General rate review filing PNM FERC • FERC annual formula rate update implemented Ju
Slide 10: Financial Updates
Financial Updates
Slide 11: Q2 2022 Ongoing EPS Financial Summary
Q2 2022 Ongoing EPS Financial Summary Q2 2022 changes in ongoing Q2 Earnings Summary earnings driven by: • Higher load and weather Clean$0.13 Energy ($0.07) Strong Financial impacts at TNMP ($0.04) • TNMP TCOS and DCOS rate $0.55 Focus Profile $0.57 PNM Corporate relief TNMP • Increased PNM FERC Tra
Slide 12: Earnings Guidance (Ongoing)
Earnings Guidance (Ongoing) 2022 ongoing earnings 2022 Earnings Guidance guidance affirmed, targeting upper half of range $2.50 Consolidated EPS $2.60 2022 Quarterly Ongoing Earnings Distribution 50% Quarterly distribution updated to reflect current expectations 19% 22% 9% Q1 Q2 Q3 Q4 2023 Earnings
Slide 13: Investment Plan 2022 – 2025
Investment Plan 2022 – 2025 Investment plan of $3.5b focused on T&D infrastructure Targeted 5% EPS CAGR 2020 -2025(1) $948 $896 $33 $36 $835 $32 $779 $31 $426 $435 $381 $299 $55 (in millions) $65 $50 $90 $433 $360 $399 $335 $307 $323 $358 $383 2022 2023 2024 2025 PNM T&D PNM Generation TNMP IT Depre
Slide 14: Appendix
PNM(C Resources’
Slide 15: PNM and TNMP Regulatory Proceedings
PNM and TNMP Regulatory Proceedings Filing Action Timing Docket No. PNM/AVANGRID filed NM Supreme Court appeal of NMPRC denial on Jan. 3, 2022, brief filed April 7, 2022 PNM/AVANGRID response brief due Aug. 5, 20-00222-UT Merger transaction approval and oral argument requested, NMPRC answer brief fi
Slide 16: Q2 2022 Ongoing EPS Details: PNM
Q2 2022 Ongoing EPS Details: PNM PNM $0.39 $0.32 • Higher transmission margins due to higher system demand and the addition of new customers, including the Western Spirit Q2 2021 Q2 2022 transmission contract • Higher O&M costs, including Q2 2022 Key Performance Drivers ∆ EPS expected plant outage c
Slide 17: Q2 2022 Ongoing EPS Details: TNMP
Q2 2022 Ongoing EPS Details: TNMP TNMP $0.31 • Weather-normalized load $0.18 growth, largely driven by new customers, and hotter Q2 2021 Q2 2022 temperatures • Rate relief from 2021 TCOS and Q2 2022 Key Performance Drivers ∆ EPS DCOS filings and the Retail load and weather $0.06 implementation of th
Slide 18: Q2 2022 Ongoing EPS Details: Corporate
Q2 2022 Ongoing EPS Details: Corporate Corporate ($0.02) ($0.06) • Higher interest rates on variable debt Q2 2021 Q2 2022 Q2 2022 Key Performance Drivers ∆ EPS Interest expense ($0.03) Other ($0.01) 18
Slide 19: Weather Impacts
Weather Impacts PNM Heating Degree Days Q2 Q2 2022 PNM 2022 2021 Normal(1) at the beginning of the quarter were lower than Heating Degree Days 15 47 62 normal and prior year, Cooling Degree Days 515 516 507 reducing earnings Net EPS Impact ($0.01) $0.00 PNM Cooling Degree Days compared to Normal in
Slide 20: Balance Sheet and Credit Metrics
Balance Sheet and Credit Metrics
Slide 21: Liquidity as of July 29, 2022
Liquidity as of July 29, 2022 Corporate/ PNM Resources PNM TNMP Other Consolidated Financing Capacity(1): (In millions) Revolving credit facilities $440.0 $100.0 $300.0 $840.0 As of 7/29/22: Short-term debt and LOC balances 119.9 35.0 41.0 195.9 Remaining availability 320.1 65.0 259.0 644.1 Invested
Slide 22: Selected Balance Sheet Information
Selected Balance Sheet Information (In millions) Dec. 31, 2021 June 30, 2022 Long-Term Debt (incl. current portion) (1) PNM $1,881.1 $1,850.1 TNMP 918.1 983.0 Corporate/Other 899.7 999.6 Consolidated $3,698.9 $3,832.7 Total Debt (incl. short-term) (1,2) PNM $1,888.5 $1,960.9 TNMP 918.5 1,083.0 Corpo
Slide 23: Credit Ratings
Credit Ratings PNMR Consolidated S&P Moody’s Issuer rating BBB Baa3 Outlook Positive Stable Senior unsecured rating BBB- Baa3 PNM S&P Moody’s Issuer rating BBB Baa2 Outlook Positive Stable Senior unsecured rating BBB Baa2 TNMP S&P Moody’s Issuer rating BBB+ Baa1 Outlook Positive Stable Senior secure