Duke Energy Corporation (holding Company) · NYSE:DUK
Duke Energy Corporation (holding Company) — Q4 2017 Earnings Presentation
84 slides from Duke Energy Corporation (holding Company)'s earnings presentation, Feb 20, 2018
Slide 1: Fourth Quarter Earnings Review and Business Update
FOURTH QUARTER EARNINGS REVIEW AND BUSINESS UPDATE FEB. 20, 2018 PRESENTED BY: LYNN GOOD | CHAIRMAN, PRESIDENT AND CEO STEVE YOUNG | EXECUTIVE VP AND CFO
Slide 2: Safe Harbor statement
Safe Harbor statement This presentation includes forward-looking statements within the meaning of the federal securities laws. Actual results could differ materially from such forward-looking statements. The factors that could cause actual results to differ are discussed in the Appendix herein and i
Slide 3: Financial highlights
Financial highlights $4.36 REPORTED DILUTED EPS FOR 2017 $4.57 ADJUSTED DILUTED EPS FOR 2017, NEAR HIGH END OF NARROWED EPS GUIDANCE RANGE OF $4.50 TO $4.60 $4.55 - $4.85 INTRODUCING 2018 EPS GUIDANCE RANGE 4 - 6% GROWTH THROUGH 2022 REAFFIRMING AND EXTENDING GROWTH RATE OFF THE MIDPOINT OF ORIGINAL
Slide 4: Our investor value proposition
Our investor value proposition A SOLID LONG-TERM HOLDING 4.6% ~8-10% 4 -6% DIVIDEND YIELD(1) zzz ATTRACTIVE HIGHLY WITH DIVIDEND RISK-ADJUSTED ACHIEVABLE GROWTH TOTAL SHAREHOLDER EPS GROWTH COMMITMENT(2) RETURN(3) THROUGH 2022(4) SUPPORTED BY THE STRENGTH OF OUR BALANCE SHEET (1) As of Feb. 16, 2018
Slide 5: Delivering on our commitments
Delivering on our commitments WHAT WE SAID… …WHAT WE DID • Narrowed adjusted diluted EPS Delivered near high end of narrowed guidance range of $4.50 to $4.60 guidance range, despite unfavorable weather Achieved cost management targets • Grow the dividend consistent with the adjusted EPS growth r
Slide 6: Strategic vision for the next decade
2017 2026 ENGAGE MODERNIZE THE GENERATE EXPAND TRANSFORM THE STAKEHOLDERS ENERGY GRID CLEANER ENERGY NATURAL GAS CUSTOMER INFRASTRUCTURE EXPERIENCE MODERN $25 $11 15 TOP RECOVERY BILLION BILLION PERCENT QUARTILE MECHANISMS INVESTMENTS IN INVESTMENTS IN GAS PROPORTION OF CUSTOMER IN ALL JURISDICTIONS
Slide 7: Modernizing the energy grid
Modernizing the energy grid AMI DEPLOYMENT ANNOUNCED BY JURISDICTION Fully POWER/FORWARD CAROLINAS: deployed by $16 BILLION DE OHIO TO BE INVESTED IN DE KENTUCKY 2018 NORTH & SOUTH CAROLINA DE CAROLINAS 2019 OVER 10 YEARS DE INDIANA 2020 DE PROGRESS 2021 DE FLORIDA 2021 0% 50% 100% Complete Added in
Slide 8: Generating cleaner energy
Generating cleaner energy Citrus County Combined Cycle Gas Turbine project, Duke Energy Florida TARGETING 40% REDUCTION IN CO2 EMISSIONS BY 2030 FROM 2005 LEVELS(1) W.S. LEE CCGT • Citrus County CCGT (DEF, 2018) and Western IN FINAL STAGES OF Carolinas (DEP, 2019) are on-time and on-budget COMMISSIO
Slide 9: Expanding natural gas infrastructure
Expanding natural gas infrastructure • Made substantial progress on Atlantic Coast Pipeline SUCCESSFUL • Obtained key state and federal permits INTEGRATION OF • Commenced construction activities under limited PIEDMONT notices to proceed from FERC PAST ONE-YEAR ANNIVERSARY OF COMBINED OPERATIONS • On
Slide 10: Delivered on our 2017 financial commitments
Delivered on our 2017 financial commitments ACHIEVED ADJUSTED 2017 ADJUSTED DILUTED DILUTED EPS NEAR EPS HIGHLIGHTS(1) HIGH END OF NARROWED GUIDANCE RANGE $0.25 ~5% Growth $0.12 $0.12 ($0.26) $4.69 $4.57 $4.57 ($0.35) $4.50 - $4.60 Narrowed 2017 2017 2016 Electric Gas Utilities, Cost Unfavorable 201
Slide 11: Tax Cuts and Jobs Act
Tax Cuts and Jobs Act TAX REFORM BENEFITS • Customers will benefit from lower taxes • Earnings power of company increases through DIRECTIONAL higher rate base growth IMPACTS Cash Earnings Flow OTHER CONSIDERATIONS Lower interest expense tax shield --- • Lower tax shield at holding company reduces
Slide 12: Achieving long-term growth objectives
Achieving long-term growth objectives IMPACTS FROM TAX REFORM …BUT EXPECT TO BE: LOWER MIDPOINT OF 2018 EARNINGS 1) BACK WITHIN THE RANGE BY 2019 BELOW 4 – 6% GUIDANCE RANGE… 2) AT THE MID TO HIGH END OF THE RANGE IN 2020 AND BEYOND 6% $4.85 $0.23 $4.83 ($0.07) $0.05 4% ($0.13) ($0.05) $4.60 $4.85 R
Slide 13: Robust capital plan supports earnings base growth
Robust capital plan supports earnings base growth 2016 - 2022 2018 - 2022 REGULATED ELECTRIC AND GROWTH CAPITAL PLAN GAS EARNINGS BASE(1) Electric 2021 EARNINGS BASE Distribution INCREASES BY ~$3.5 BILLION; 36% CAGR NOW 7% (UP FROM 6.1%)(2) Commercial $90 Renewables, 4% $87 $84 $37 LDC Infrastructur
Slide 14: Maintaining balance sheet strength
Maintaining balance sheet strength PRIMARY KEY MESSAGES CREDIT METRICS • Committed to maintaining strong credit quality, FFO/DEBT HOLDCO DEBT % including investment-grade ratings Target: 15 - 16% Target: Low 30%’s 15-16% • Assuming $2 billion equity issued in 2018, ~34% including $350 million origin
Slide 15: Strong customer growth and cost management support allowed ROEs
Strong customer growth and cost management support earning our allowed ROEs ADJUSTED ELECTRIC RESIDENTIAL GAS UTILITIES BOOK ROEs(2) GROWTH AND RETAIL RESIDENTIAL VOLUME TRENDS GROWTH TRENDS 10.0% 10.4% Carolinas ADJUSTING FOR LEAP YEAR 10.4% 2017 RETAIL ELECTRIC 9.75–10.25% SALES INCREASED BY 0.7%
Slide 16: Managing regulatory activity
Managing regulatory activity Denotes modern recovery mechanism JURISDICTION 2017 2018 2019 2020 2021 2022 Pending – NC H.B. 589 rider – NC - Filed annually DEC Planned – SC Planning for multiple rate cases – NC / SC H.B. 589 rider – NC - Filed annually DEP Pending – NC Planning for multiple rate cas
Slide 17: Ongoing commitment to the dividend
Ongoing commitment to the dividend 70 - 75% DUK ANNUALIZED EXPECTED DIVIDEND PER SHARE(2) PAYOUT RATIO THROUGH 2022(1) 4 - 6% ANNUAL DIVIDEND GROWTH ~75% $3.18 $3.30 $3.42 $3.56 OF TSR ACHIEVED 2014 2015 2016 2017 (3) 2018E THROUGH DIVIDEND REINVESTMENT OVER LAST 20 YEARS (1) Based on adjusted dilut
Slide 18: Our investor value proposition
Our investor value proposition A SOLID LONG-TERM HOLDING 4.6% ~8-10% 4 -6% DIVIDEND YIELD(1) zzz ATTRACTIVE HIGHLY WITH DIVIDEND RISK-ADJUSTED ACHIEVABLE GROWTH TOTAL SHAREHOLDER EPS GROWTH COMMITMENT(2) RETURN(3) THROUGH 2022(4) SUPPORTED BY THE STRENGTH OF OUR BALANCE SHEET (1) As of Feb. 16, 2018
Slide 19: Appendix materials
Appendix materials Item Slide(s) 2017 performance against guidance assumptions 20-25 2018 guidance support 26-37 Financing assumptions 38-45 Regulatory overview 46-51 Segment overviews 52-58 Upcoming events & other 59-63 FOURTH QUARTER 2017 EARNINGS REVIEW AND BUSINESS UPDATE 19
Slide 20: 2017 performance against guidance assumptions
2017 performance against guidance assumptions FOURTH QUARTER 2017 EARNINGS REVIEW AND BUSINESS UPDATE 20
Slide 21: 4Q 2016 – 4Q 2017 adjusted diluted EPS waterfall
4Q 2016 – 4Q 2017 adjusted diluted EPS waterfall Previously 4Q 2017 Electric Utilities & Gas Utilities Commercial Other Disposed Weather Impact Infrastructure & Infrastructure Renewables Businesses $0.01 ($0.04) $0.04 $0.10 ($0.06) $1.03 $0.99 growth ▲ Customer $1.00 ▼ Higher and increased income ta
Slide 22: Full year 2016 – full year 2017 adjusted diluted EPS waterfall
Full year 2016 – full year 2017 adjusted diluted EPS waterfall Previously Full Year 2017 Electric Utilities Gas Utilities Commercial Change in Other Disposed Weather Impact & Infrastructure & Infrastructure Renewables Share Count Businesses $0.01 $0.02 ($0.06) $0.20 ($0.35) $4.95 $4.96captive ▲ Favo
Slide 23: Key 2017 adjusted earnings guidance assumptions
Key 2017 adjusted earnings guidance assumptions ($ in millions) Original 2017 2017 Assumptions (1) Actual Adjusted segment income/(expense) (2): Electric Utilities & Infrastructure $3,109 $3,077 Gas Utilities & Infrastructure $282 $293 Commercial Renewables $99 $73 Other (3) ($268) ($244) Duke Energ
Slide 24: Weather normalized volume trends, by electric jurisdiction
Weather normalized volume trends, by electric jurisdiction Rolling Twelve Months, as of Dec. 31, 2017 Duke Energy Duke Energy Duke Energy Duke Energy Duke Energy Electric Carolinas Progress Florida Indiana Ohio/Kentucky Utilities 2.9% 2.1% 1.3% 1.4% 0.9% 0.9% 1.0% 0.6% 0.5% 0.4% 0.3% 0.2% 0.3% 0.4%
Slide 25: Electric utilities quarterly weather impacts
Electric utilities quarterly weather impacts Weather segment 2017 2016 income to normal: Pretax impact Weighted avg. EPS impact – Pretax impact Weighted avg. EPS impact – diluted shares favorable / shares favorable / (unfavorable) (unfavorable) First Quarter ($175) 700 ($0.15) ($10) 689 ($0.01) Seco
Slide 26: 2018 guidance support
2018 guidance support FOURTH QUARTER 2017 EARNINGS REVIEW AND BUSINESS UPDATE 26
Slide 27: Key 2018 adjusted earnings guidance assumptions
Key 2018 adjusted earnings guidance assumptions ($ in millions) 2017 2018 2018 Interest Expense Assumption Actual Assumptions (Consolidated Total $2,067) Adjusted segment income/(expense) (1): Electric Utilities & Infrastructure $3,077 $3,304 $617 Gas Utilities & Infrastructure $293 $319 Commercial
Slide 28: 2017 – 2018 adjusted diluted EPS waterfall
2017 – 2018 adjusted diluted EPS waterfall Electric Utilities Gas Utilities Commercial 2017 Weather Other Share dilution & Infrastructure & Infrastructure Renewables $0.12 ($0.20) ($0.09) $0.20 $0.04 $0.06 ▲ New solar resources $4.55 - $4.85 ▲ Piedmont Integrity ▲ Normal wind $0.04 Management Riders
Slide 29: Key 2018 earnings sensitivities
Key 2018 earnings sensitivities Driver EPS Impact 1% change in earned return on equity +/- $0.45 Electric Utilities & $1 billion change in rate base +/- $0.07 Infrastructure 1% change in Electric Utilities volumes +/- $0.12 1% change in earned return on equity +/- $0.05 Gas Utilities & $200 million
Slide 30: 2018 pension funding and costs
2018 pension funding and costs • On a consolidated basis, all Duke Energy Pension pension plans are fully funded as of Contributions 2016A 2017A 2018E ($ in millions) Dec. 31, 2017 on a PBO basis All plans $155 $19 $148 • Duke Energy’s pension funding policy: • The company is committed to funding it
Slide 31: Electric utilities weather-normalized volume trends
Electric utilities weather-normalized volume trends (in % change since prior year) Residential Commercial 1.0% 0.7% 0.6% 0.5% 0.5% 0.5% 0.1% -0.1% 2015A 2016A 2017A 2018E 2015A 2016A 2017A 2018E Industrial Electric Utilities Total 1.0% 0.8% 0.6% 0.5% 0.4% 0.3% 0.2% -0.6% 2015A 2016A 2017A 2018E 2015
Slide 32: Regulated utilities end of year earnings base
Regulated utilities end of year earnings base(1) Electric Utilities Earnings Base ($ in billions) 2017A 2018E 2019E 2020E 2021E 2022E Duke Energy Carolinas $22.6 $23.9 $24.9 $26.0 $26.6 $27.6 Duke Energy Progress 15.7 16.9 17.9 18.6 19.3 20.2 Duke Energy Florida 12.0 13.3 14.5 15.5 16.5 17.2 Duke In
Slide 33: Capital expenditures profile
Capital expenditures profile(1) ($ in millions) Capital Expenditures 2017A 2018E 2019E 2020E 2021E 2022E 2018 - 2022 Electric Generation (2) $ 1,545 1,825 1,425 1,175 1,250 1,000 $ 6,675 Electric Transmission 994 950 1,350 1,100 1,075 1,100 5,575 Electric Distribution 1,478 2,125 2,625 2,850 2,600 2
Slide 34: Capital expenditures by utility
Capital expenditures by utility(1) ($ in millions) Duke Energy Carolinas 2017A 2018E 2019E 2020E 2021E 2022E 2018 - 2022 Electric Generation $ 461 $ 500 $ 600 $ 475 $ 400 $ 350 $ 2,325 Electric Transmission 78 175 250 225 200 225 1,075 Electric Distribution 639 825 925 1,025 1,025 1,200 5,000 (2) En
Slide 35: Capital expenditures by utility (continued)
Capital expenditures by utility (continued)(1) ($ in millions) Duke Energy Florida 2017A 2018E 2019E 2020E 2021E 2022E 2018 - 2022 Electric Generation $ 565 $ 400 $ 250 $ 400 $ 375 $ 125 $ 1,550 Electric Transmission 358 275 525 550 475 475 2,300 Electric Distribution 258 325 425 450 400 400 2,000 E
Slide 36: Capital expenditures by utility (continued)
Capital expenditures by utility (continued)(1) ($ in millions) Duke Energy OH/KY Electric 2017A 2018E 2019E 2020E 2021E 2022E 2018 - 2022 Electric Generation $ 11 $ 25 $ 25 $ - $ - $ - $ 50 Electric Transmission 274 175 175 125 75 75 625 Electric Distribution 64 300 350 350 300 275 1,575 Environment
Slide 37: Environmental compliance expenditures by category
Environmental compliance expenditures by category ($ in millions) Total Project Spend 2018 – 2022 Coal Ash Closure Costs Category 2018 – 2022 Costs To Date(2) Plan Air (MATS) $110 Duke Energy Carolinas $2,490 $725 $740 Water (316b) $390 Duke Energy Progress $2,630 $500 $1,260 Waste (conversions)(1)
Slide 38: Financing assumptions
Financing assumptions FOURTH QUARTER 2017 EARNINGS REVIEW AND BUSINESS UPDATE 38
Slide 39: Simplified financing structure
Simplified financing structure Duke Energy (HoldCo) Cinergy Corp. Progress Energy (HoldCo) (HoldCo) (1) Duke Energy Duke Energy Duke Energy Duke Energy Duke Energy Piedmont Natural Carolinas Ohio Indiana Progress Florida Gas Commercial Paper and LT Financings Duke Energy Duke Energy Renewables Money
Slide 40: Forecasted 2018 Summary Cash Flows
Forecasted 2018 Summary Cash Flows(1) (2) Adjusted net income $ 3,360 Depreciation & amortization 4,675 Deferred and accrued taxes 820 Issuances & Maturities Summary (3) (2018 Estimate) Other sources / (uses), net (355) $4,400 Primary sources 8,500 Capital expenditures (10,950) $2,215 $1,530 Dividen
Slide 41: 2018 financing plan
2018 financing plan(1)(2) ($ in millions) $2,500 $2,000 $1,500 $1,000 $500 $- Holding Duke Duke Duke Duke Piedmont Renewables Company Energy Energy Energy Energy Carolinas Progress Florida Kentucky 2018 Maturities and Debt Reduction Expected Debt Issuances Expected Equity Issuances (1) Represents ex
Slide 42: Liquidity summary (as of Dec. 31, 2017)
Liquidity summary (as of Dec. 31, 2017) ($ in millions) Duke Duke Duke Duke Duke Duke Piedmont Duke Energy Energy Energy Energy Energy Energy Natural Energy Carolinas Progress Florida Indiana Ohio Kentucky Gas Total Master Credit Facility (1) $ 2,850 $ 1,350 $ 1,250 $ 800 $ 600 $ 300 $ 150 $ 700 $ 8
Slide 43: Long-term debt maturities
Long-term debt maturities(1) $3,238 $3,100 $160 $170 $2,912 $174 Regulated Utilities Maturities Detail ($ in millions) 2018 2019 2020 $1,438 $2,228 $2,180 Duke Energy Carolinas (2) $ 1,204 $5 $ 905 Duke Energy Progress (2) 3 603 304 Duke Energy Florida (2) (3) 715 216 518 Duke Energy Indiana 2 60 50
Slide 44: Credit ratings (as of Feb. 20, 2018)
Credit ratings (as of Feb. 20, 2018) Holding Companies Operating Companies Moody's S&P Fitch Moody's S&P DUKE ENERGY Negative Stable Negative DUKE ENERGY CAROLINAS Stable Stable Senior Unsecured Debt Baa1 BBB+ BBB+ Senior Secured Debt Aa2 A Senior Unsecured Debt A1 A- Commercial Paper P-2 A-2 F-2 DU
Slide 45: Credit metrics
Credit metrics(1) Committed to maintaining quality, investment-grade ratings FFO/Debt (2) 29% 26% 26% 26% 24% 24% 22% 22% 21% 22% 21% 22% 21% 21% 19% 18% 18% 15% 14% 15% 14% 2016A 2017A 2018E 2016A 2017A 2018E 2016A 2017A 2018E 2016A 2017A 2018E 2016A 2017A 2018E 2016A 2017A 2018E 2016A 2017A 2018E
Slide 46: Regulatory overview
Regulatory overview FOURTH QUARTER 2017 EARNINGS REVIEW AND BUSINESS UPDATE 46
Slide 47: Base rate case activity and timeline
Base rate case activity and timeline Evidentiary Pre-Filing Rate Case Intervenor Duke Rebuttal Hearings Notes Notice Filed Testimony Testimony Begin • Docket: E-2 Sub 1142 • Base rate case • Partial settlement with NCUC DEP NC May 2, 2017 June 1, 2017 Oct. 20, 2017 Nov. 6, 2017 Nov. 27, 2017 Public
Slide 48: Overview of state commissions by jurisdiction
Overview of state commissions by jurisdiction North South Florida Indiana Ohio Kentucky Tennessee Carolina Carolina Number of 7 7 5 5 5 3 5 Commissioners Term 6-year terms 4-year terms 4-year terms 4-year terms 5-year terms 4-year terms 6-year terms Appointed by Appointed/ Appointed by Elected by th
Slide 49: Current electric rate information by jurisdiction
Current electric rate information by jurisdiction North South Ohio Kentucky Florida Indiana Carolina Carolina (Electric) (Electric) $15.7 B (1) (DEC) Retail Rate Base $11.5B (2) $7.0 B (3) $1.3 B (4) $600 M (5) $8.0 B (1) (DEP) $1.6 B (DEC) 3Q 2017 $0.4 B Wholesale Rate Base $1.4 B (2) $550 M $0 $3.
Slide 50: Current electric rate information by jurisdiction (continued)
Current electric rate information by jurisdiction (continued) General Rate Case Provisions North South Ohio Kentucky Florida Indiana Carolina Carolina (Electric) (Electric) Notice of Intent Required? Yes Yes Yes Yes (1) Yes Yes Notice Period 30 Days 30 Days 60 Days Varies 30 Days 28 Days Historical
Slide 51: Current gas rate information by jurisdiction
Current gas rate information by jurisdiction North South Ohio Kentucky Tennessee Carolina Carolina (Gas) (Gas) Rate Base ($M) $1,822 $304 $349 $900 (1) $200 (2) Allowed ROE 10.0% 10.2% 10.2% 9.84% 10.38% Allowed Equity 50.7% 53.0% 52.7% 53.3% 50.8% Effective Date of 1/1/14 11/1/17 (3) 3/1/12 12/1/13
Slide 52: Segment Overviews
Segment Overviews FOURTH QUARTER 2017 EARNINGS REVIEW AND BUSINESS UPDATE 52
Slide 53: Duke Energy business segment structure
Duke Energy business segment structure Duke Energy Electric Utilities Gas Utilities Commercial Other & Infrastructure & Infrastructure Renewables North and South Duke Energy Carolinas Piedmont Natural Gas Carolina North and South Commercial Duke Energy Progress Carolina Pipelines Duke Energy Florida
Slide 54: Complementary businesses with strong growth opportunities
Complementary businesses with strong growth opportunities ELECTRIC UTILITIES 2018 ADJUSTED 2018-2022 2017 – 2022 & INFRASTRUCTURE EPS CONTRIBUTION(1) GROWTH CAPITAL ADJUSTED EPS CAGR(2) Consolidated 4-6% 88% $28.8 B 10-14% 11-13% GAS UTILITIES & INFRASTRUCTURE 9% $6.7 B 5-6% COMMERCIAL RENEWABLES 3%
Slide 55: Duke Energy – A large scale, highly regulated energy infrastructure company
Duke Energy – A large scale, highly regulated energy infrastructure company HEADQUARTERED IN ELECTRIC UTILITIES CHARLOTTE, NC & INFRASTRUCTURE • Operating in six constructive jurisdictions, with attractive allowed ROEs, serving 7.6 million retail customers • Below average customer rates(1) • Balance
Slide 56: Electric Utilities and Infrastructure
Electric Utilities and infrastructure A portfolio of attractive utilities in constructive jurisdictions COMPETITIVE REGULATED ELECTRIC EIGHT UTILITIES IN 2017 EARNINGS BASE CUSTOMER RATES HIGH-QUALITY Avg. ¢/kWh Retail Rates DEO - Electric DEK - Electric REGIONS OF THE U.S. (12 mos. ending 6/30/17)(
Slide 57: Gas Utilities and Infrastructure – at a glance
Gas Utilities and Infrastructure – at a glance GAS UTILITIES WITH LOW ATLANTIC COAST PIPELINE VOLUMETRIC EXPOSURE DUE TO TO BRING SIGNIFICANT GAS SUPPLY TO MOSTLY FIXED MARGINS… UNDERSERVED EASTERN 13% CAROLINAS 12% • 47% joint owner • Commenced construction activities under LNTPs 75% 87% • Projecte
Slide 58: Commercial and Regulated Renewables asset locations
Commercial and Regulated Renewables asset locations(1) (1) A full list of generation facilities can be found at https://www.duke-energy.com//_/media/pdfs/our-company/investors/duke-energy-generation-portfolio.pdf FOURTH QUARTER 2017 EARNINGS REVIEW AND BUSINESS UPDATE 58
Slide 59: Upcoming Events & Other
Upcoming Events & Other FOURTH QUARTER 2017 EARNINGS REVIEW AND BUSINESS UPDATE 59
Slide 60: Upcoming events
Upcoming events Event Date 1Q 2018 earnings call (tentative) May 10, 2018 2Q 2018 earnings call (tentative) August 2, 2018 3Q 2018 earnings call (tentative) November 2, 2018 FOURTH QUARTER 2017 EARNINGS REVIEW AND BUSINESS UPDATE 60
Slide 61: Investor relations contact information
Investor relations contact information Mike Callahan, Vice President Investor Relations • Michael.Callahan@duke-energy.com • (704) 382-0459 Mike Switzer, Director Investor Relations • Mike.Switzer@duke-energy.com • (704) 382-6473 Abby Motsinger, Manager Investor Relations • Abby.Motsinger@duke-energ
Slide 62: Safe Harbor statement
Safe Harbor statement Safe Harbor statement This document includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are based on management’s beliefs and assumptions and can o
Slide 63: For additional information on Duke Energy
For additional information on Duke Energy, please visit: www.duke-energy.com/investors FOURTH QUARTER 2017 EARNINGS REVIEW AND BUSINESS UPDATE 63
Slide 64: Non-GAAP Reconciliations
Duke Energy Corporation Non-GAAP Reconciliations Fourth Quarter Earnings Review & Business Update February 20, 2018 Adjusted Diluted Earnings per Share (EPS) The materials for Duke Energy Corporation’s (Duke Energy) Fourth Quarter Earnings Review and Business Update on February 20, 2018, include a d
Slide 65: Non-GAAP measures: long-term growth and forecasts
also reference the long-term range of annual growth of 4% - 6% through 2022 in adjusted diluted EPS (on a compound annual growth rate (CAGR) basis). Adjusted diluted EPS is a non-GAAP financial measure as it represents diluted EPS from continuing operations attributable to Duke Energy Corporation sh
Slide 66: Dividend Payout Ratio
Dividend Payout Ratio The materials for Duke Energy’s Fourth Quarter Earnings Review and Business Update on February 20, 2018 include a discussion of Duke Energy’s forecasted dividend payout ratio of 70% - 75% through 2022 based upon adjusted diluted EPS. This payout ratio is a non-GAAP financial me
Slide 67: Available Liquidity
Available Liquidity The materials for Duke Energy’s Fourth Quarter Earnings Review and Business Update on February 20, 2018 include a discussion of Duke Energy’s available liquidity balance. The available liquidity balance presented is a non-GAAP financial measure as it represents Cash and cash equi
Slide 68: Reported to Adjusted Earnings Reconciliation, Three Months Ended Dec. 31, 2017
DUKE ENERGY CORPORATION REPORTED TO ADJUSTED EARNINGS RECONCILIATION Three Months Ended December 31, 2017 (Dollars in millions, except per-share amounts) Special Items Costs to Achieve Commercial Impacts Reported Piedmont Regulatory Renewables of the Discontinued Total Adjusted Earnings Merger Settl
Slide 69: Reported to Adjusted Earnings Reconciliation, Twelve Months Ended Dec. 31, 2017
DUKE ENERGY CORPORATION REPORTED TO ADJUSTED EARNINGS RECONCILIATION Twelve Months Ended December 31, 2017 (Dollars in millions, except per-share amounts) Special Items Costs to Achieve Commercial Reported Piedmont Regulatory Renewables Impacts of Discontinued Total Adjusted Earnings Merger Settleme
Slide 70: Reported to Adjusted Earnings Reconciliation, Three Months Ended Dec. 31, 2016
DUKE ENERGY CORPORATION REPORTED TO ADJUSTED EARNINGS RECONCILIATION Three Months Ended December 31, 2016 (Dollars in millions, except per-share amounts) Special Items Costs to Cost International Reported Achieve Savings Energy Discontinued Total Adjusted Earnings Mergers Initiatives Operations Oper
Slide 71: Reported to Adjusted Earnings Reconciliation, Twelve Months Ended Dec. 31, 2016
DUKE ENERGY CORPORATION REPORTED TO ADJUSTED EARNINGS RECONCILIATION Twelve Months Ended December 31, 2016 (Dollars in millions, except per-share amounts) Special Items Costs to Cost Commercial International Reported Achieve Savings Renewables Energy Discontinued Total Adjusted Earnings Mergers Init
Slide 72: Adjusted Effective Tax Reconciliation
DUKE ENERGY CORPORATION ADJUSTED EFFECTIVE TAX RECONCILIATION December 2017 (Dollars in Millions) Three Months Ended Year Ended December 31, 2017 December 31, 2017 Balance Effective Tax Rate Balance Effective Tax Rate Reported Income From Continuing Operations Before Income Taxes $ 866 $ 4,266 Costs
Slide 73: Available Liquidity Reconciliation
Duke Energy Corporation Available Liquidity Reconciliation As of December 31, 2017 (In millions) Cash and Cash Equivalents $ 358 Less: Certain Amounts Held in Foreign Jurisdictions (5) Less: Unavailable Domestic Cash (54) 299 Plus: Remaining Availability under Master Credit Facilities and other faci
Slide 74: Adjusted Book Return on Equity, 2017
DUKE ENERGY CORPORATION ADJUSTED BOOK RETURN ON EQUITY (ROEs) For the period ended December 31, 2017 dollars in millions Duke Energy Duke Energy Duke Energy Duke Energy Duke Energy Ohio Reportable Carolinas Progress Total Carolinas Florida Indiana Segments Piedmont Reported Net Income 2017 $ 1,214 $
Slide 75: Adjusted Book Return on Equity, 2016
DUKE ENERGY CORPORATION ADJUSTED BOOK RETURN ON EQUITY (ROEs) For the period ended December 31, 2016 dollars in millions Duke Energy Duke Energy Duke Energy Duke Energy Duke Energy Ohio Reportable Piedmont Natural Carolinas Progress Total Carolinas Florida Indiana Segments Gas (4) Reported Net Incom
Slide 76: Adjusted Book Return on Equity, 2015
DUKE ENERGY CORPORATION ADJUSTED BOOK RETURN ON EQUITY (ROEs) For the period ended December 31, 2015 dollars in millions Duke Energy Duke Energy Duke Energy Duke Energy Duke Energy Ohio Reportable Piedmont Natural Carolinas Progress Total Carolinas Florida Indiana Segments Gas (4) Reported Net Incom
Slide 77: 2018 Forecasted Cash Flow Reconciliation
Duke Energy Corporation 2018 Forecasted Cash Flow Reconciliation, Required by SEC Regulation G 2018 Analyst Meeting February 20, 2018 ($ in millions) Forecast 2018 Primary Sources: Adjusted net income (1) (a) $ 3,360 Depreciation & amortization (a) 4,675 Deferred and accrued taxes (a) 820 Other sour
Slide 78: FFO to Debt Calculation, Duke Energy Corporation
FFO to Debt Calculation Duke Energy Corporation (in millions) Years Ended December 31, 2017 2016 Actual Actual Cash From Operations $ 6,634 $ 6,817 Working capital adjustment (1) 740 (394) Capitalized Interest (128) (100) CR3 securitization adjustment (53) (35) Other 20 19 Funds From Operations 7,21
Slide 79: FFO to Debt Calculation, Duke Energy Carolinas
FFO to Debt Calculation Duke Energy Carolinas (in millions) Years Ended December 31, 2017 2016 Actual Actual Cash From Operations $ 2,634 $ 2,976 Working capital adjustment (1) (54) (333) Capitalized Interest (45) (38) Funds From Operations 2,535 2,605 ARO spend 271 287 ARO spend, net of tax at 38%
Slide 80: FFO to Debt Calculation, Duke Energy Progress
FFO to Debt Calculation Duke Energy Progress (in millions) Years Ended December 31, 2017 2016 Actual Actual Cash From Operations $ 1,195 $ 1,932 Working capital adjustment (1) 520 (502) Capitalized Interest (21) (17) Other 3 2 Funds From Operations 1,697 1,415 ARO spend 192 212 ARO spend, net of tax
Slide 81: FFO to Debt Calculation, Duke Energy Florida
FFO to Debt Calculation Duke Energy Florida (in millions) Years Ended December 31, 2017 2016 Actual Actual Cash From Operations $ 1,028 $ 844 Working capital adjustment (1) 216 252 Capitalized Interest (24) (14) CR3 securitization adjustment (53) (35) Other 14 13 Funds From Operations 1,181 1,060 AR
Slide 82: FFO to Debt Calculation, Duke Energy Indiana
FFO to Debt Calculation Duke Energy Indiana (in millions) Years Ended December 31, 2017 2016 Actual Actual Cash From Operations $ 969 $ 871 Working capital adjustment (1) (102) 132 Capitalized Interest (9) (7) Funds From Operations 858 996 ARO spend 45 46 ARO spend, net of tax at 38% 28 29 FFO exc.
Slide 83: FFO to Debt Calculation, Duke Energy Ohio
FFO to Debt Calculation Duke Energy Ohio (in millions) Years Ended December 31, 2017 2016 Actual Actual Cash From Operations $ 479 $ 425 Working capital adjustment (1) 15 15 Capitalized Interest (10) (8) Funds From Operations 484 432 ARO spend 7 5 ARO spend, net of tax at 38% 4 3 FFO exc. coal ash s
Slide 84: FFO to Debt Calculation, Piedmont Natural Gas
FFO to Debt Calculation Piedmont Natural Gas (in millions) Years Ended December 31, October 31, 2017 2016 Actual Actual Cash From Operations $ 329 $ 308 Working capital adjustment (1) 125 101 Capitalized Interest 12 2 Funds From Operations 466 411 ARO spend - 6 ARO spend, net of tax at 38% - 4 FFO e