Tennessee Valley Authority · NYSE:TVC
Tennessee Valley Authority — FY2014 Earnings Presentation
14 slides from Tennessee Valley Authority's earnings presentation, Nov 6, 2014
Slide 1: Financial Performance Update
????????????????? FINANCIAL PERFORMANCE UPDATE FINANCE, RATES, AND PORTFOLIO COMMITTEE 21
Slide 2: Fiscal Year 2014 (Preliminary Unaudited)
22 Fiscal Year 2014 (Preliminary Unaudited) Net Income: $468M higher than plan and $198M higher than last year Base Revenues ($314M above plan) ?? Colder weather resulting in 10% more heating degree days ?? Fuel expense $326M higher than plan due to increased sales Operating & Maintenance Expenses (
Slide 3: Base Revenues
23 Base Revenues (Preliminary Unaudited) FINANCE, RATES, AND PORTFOLIO COMMITTEE Fiscal Year Non-Fuel Revenue was $314M above budget 0 200 400 600 800 Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep FY14 Budget $ million $7,094 $6,988 $7,302 FYTD 13 Actual FYTD 14 Budget FYTD 14 Actual
Slide 4: Fuel Rates
24 Fuel Rates (Preliminary Unaudited) FINANCE, RATES, AND PORTFOLIO COMMITTEE Q2 under recoveries from colder winter weather have been fully recovered 0 5 10 15 20 25 30 35 Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep FY14 Budget $/MWh $23.75 $22.75 $24.22 FYTD 13 Actual FYTD 14 Budget FYTD 14 Ac
Slide 5: Cold Winter Reflected in Spring Fuel Rates
25 Cold Winter Reflected in Spring Fuel Rates FINANCE, RATES, AND PORTFOLIO COMMITTEE Base Revenues 0 200 400 600 800 O c t N o v D e c J a n F e b Mar A p r M a y J u n J u l A u g S e p $ million 0 5 10 15 20 25 30 35 O c t N o v D e c J a n F e b M a r A p r M a y J u n J u l A u g S e p $/MWh Fu
Slide 6: FY14 Income Statement
26 FYTD 14 FYTD 13 $ million Actual Budget Variance Actual ‘14 vs ‘13 Total Operating Revenue $11,137 $10,468 $669 $10,956 $181 Fuel and Purchased Power 3,824 3,498 (326) 3,847 23 O&M 3,341 3,438 97 3,428 87 Taxes, Depreciation, Other 2,334 2,262 (72) 2,184 (150) Interest 1,169 1,269 100 1,226 57 Ne
Slide 7: FY14 Cash Flow Statement
27 The Net Change in Cash is unfavorable to budget by $1,002M & prior year by $1,836M 3,6193,619 3,619 3,619 FY14 Cash Flow Statement (Preliminary Unaudited) FINANCE, RATES, AND PORTFOLIO COMMITTEE FYTD 2014 FYTD 2013 $ million Actual Budget Variance Actual ’14 v ‘13 Cash Flow from Operating Activit
Slide 8: O&M Expense
28 O&M Expense (Preliminary Unaudited) FINANCE, RATES, AND PORTFOLIO COMMITTEE Routine Outage Projects/SBU Other Other includes EEDR program costs and Corporate Insurance $ billion 3.2 3.6 3.5 3.4 3.7 3.3 3.4 3.0 2.9 3.0 $0 $1 $2 $3 $4 FY10 FY11 FY12 FY13A FY13B FY14A FY14B FY15P FY16P FY17P $500M R
Slide 9: Managing Cash and Debt
29 Managing Cash and Debt (Preliminary Unaudited) FINANCE, RATES, AND PORTFOLIO COMMITTEE Increasing assets by nearly $18 billion while increasing debt by less than $2 billion $ billion < $2 billion $18 billion FY10 FY11 FY12 FY13 FY14 FY15P FY16P FY17P $- $5 $10 $15 $20 Total Debt & Other Financing
Slide 10: Moving Forward
30 Moving Forward (Preliminary Unaudited) FY14 Results show progress toward our long-term plan: ?? Exceeded our $300 million target on O&M savings – on track to achieve $500 million (17%) reduction for FY15 ?? Provided $2.5 billion for new capital investment – increasing to a record $3.5 billion in
Slide 11: Tax Equivalent Payments
32 Tax Equivalent Payments FINANCE, RATES, AND PORTFOLIO COMMITTEE | SECTION 13 TAX EQUIVALENT PAYMENTS The TVA Act requires TVA to make tax equivalent payments to states and counties in which TVA holds power property or sells power. For Board Consideration: Approval of the final tax equivalent paym
Slide 12: Background
33 Background FINANCE, RATES, AND PORTFOLIO COMMITTEE | SECTION 13 TAX EQUIVALENT PAYMENTS Section 13 of the TVA Act requires five percent of TVA’s gross proceeds from power sales* to be redistributed as tax equivalent payments The payments to states are determined by the following criteria: ?? 50 p
Slide 13: Historical Calculated Tax Equivalent Payments
34 Historical Calculated Tax Equivalent Payments FINANCE, RATES, AND PORTFOLIO COMMITTEE | SECTION 13 TAX EQUIVALENT PAYMENTS Final Final Final Final Final Estimated FY10 FY11 FY12 FY13 FY14 FY15 Gross Proceeds from Power Sales 11,006$ 10,593$ 11,580$ 10,948$ 10,661$ 10,840$ Required % to be Distrib
Slide 14: Tax Equivalent Payments by State
35 Tax Equivalent Payments by State FINANCE, RATES, AND PORTFOLIO COMMITTEE | SECTION 13 TAX EQUIVALENT PAYMENTS ($ million) Final Final Final Final Final Estimated State FY10 FY11 FY12 FY13 FY14 FY15 Alabama 125$ 116$ 123$ 111$ 106$ 103$ Georgia 9 9 9 8 9 9 Illinois 1 <1 1 1 <1 1 Kentucky 49 47 47
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