Slide 1: Q2 2023 Earnings Review
Q2 2023 Earnings Review August 4, 2023
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 Results and Strategic Updates
Financial Results and Strategic Updates Financial Results and Guidance Q2 2023 Q2 2022 YTD 2023 YTD 2022 Q2 2023 earnings results GAAPClean EPS Energy $0.53 $0.18 Strong $1.16Financial $0.36 Focus Ongoing EPS $0.55 $0.57 $1.10 $1.08 Profile • 2023 Ongoing EPS Guidance affirmed $2.65 - $2.75 2023 ear
Slide 5: Operational and Regulatory Updates
Operational and Regulatory Updates
Slide 6: PNM Operational Highlights
PNM Operational Highlights PNM Clean Energy Transition • 410 MW of new solar and storage nearing completion • Results in 60% carbon-free capacity, will exceed 70% carbon-free with full integration of 2023/2024 approved resources • 2026 Resource Filing • RFP initiated in Nov 2022 for resources in 202
Slide 7: PNM Key Regulatory Proceedings
PNM Key Regulatory Proceedings Grid Modernization • Procedural schedule on hold, pending requested Cost Benefit Analysis • Decision now expected in first half of 2024, no changes to customer benefits 2024 Rate Change • Moving through procedural schedule: • Staff/Intervenor testimony filed June 23, 2
Slide 8: TNMP Operational Highlights and Key Regulatory Proceedings
TNMP Operational Highlights and Key Regulatory Proceedings Operational Highlights TNMP System Peak • New all-time system peak reached in June 2,500 2,256 2,030 reflects weather and continued system growth 2,000 1,796 1,500 • 5-time recipient of EnergyStar® Partner of MWs 1,000 the Year Sustained Exc
Slide 9: TNMP: Texas Legislative Session Highlights
TNMP: Texas Legislative Session Highlights • Constructive session for utilities focused on grid reliability and resilience • Bills passed to encourage and protect utility infrastructure investments : Distribution Cost Recovery Filing (DCRF) System Resiliency Temporary Mobile Generation West
Slide 10: Financial Updates
a oe a eA Financial Updates
Slide 11: Q2 2023 Ongoing EPS Financial Summary
Q2 2023 Ongoing EPS Financial Summary Q2 2023 changes in ongoing Q2 Earnings Summary earnings: • Lower costs associated with PNM $0.06 ($0.02) $0.57 Clean Energy ($0.06) generation portfolio changes Strong Financial $0.55 • TNMP Transmission and Focus TNMP Profile Distribution riders recover Corpora
Slide 12: Load and Economic Conditions
Load and Economic Conditions PNM Mild weather and shoulder months combine Q2 YTD for low Q2 usage PNM 2023 vs 2022 2023E Slower ramp-up from Industrial customers compared to Total Retail Load(1) (0.4%) 2% - 3% 2023 guidance continues Partially offset by better-than-expected YTD growth PNM Avg. C
Slide 13: Earnings Guidance (Ongoing)
Earnings Guidance (Ongoing) 2023 Guidance Updates: 2023 Earnings Guidance • Annual guidance range affirmed, $2.65 Consolidated EPS $2.75 quarterly distribution updated PNM TNMP Corp/Other • Interest rate hedges reduce $2.14 – $2.19 $0.98 – $1.01 ($0.47) – ($0.45) variable interest rate risks • Avera
Slide 14: Appendix
Appendix
Slide 15: PNM and TNMP Key Regulatory Proceedings
PNM and TNMP Key Regulatory Proceedings Filing Action Timing Docket No. PNM/AVANGRID appealed NMPRC denial with NM Merger transaction 20-00222-UT Supreme Court on Jan. 3, 2022, briefings completed Aug. No statutory timeframe approval S-1-SC-39152 5, 2022, oral argument scheduled for Sept. 15, 2023 F
Slide 16: Q2 2023 Ongoing EPS Details: PNM
Q2 2023 Ongoing EPS Details: PNM • Lower costs associated with the PNM $0.38 retirement of the San Juan Generating Station and return of $0.32 Palo Verde leased capacity • Gas plant outages in Q2 2022 • Improved realized Q2 2022 Q2 2023 decommissioning / reclamation trust performance in Q2 2023 Q2 2
Slide 17: Q2 2023 Ongoing EPS Details: TNMP
Q2 2023 Ongoing EPS Details: TNMP TNMP • Rate relief from 2022 and $0.31 $0.29 2023 TCOS and DCRF filings • Weather-normalized load growth, primarily from crypto Q2 2022 Q2 2023 mining customers, largely offset by hotter temperatures Q2 2023 Key Performance Drivers ∆ EPS in Q2 2022 Transmission rate
Slide 18: Q2 2023 Ongoing EPS Details: Corporate
Q2 2023 Ongoing EPS Details: Corporate Corporate ($0.06) ($0.12) Q2 2022 Q2 2023 • Higher variable debt interest, Q2 2023 Key Performance Drivers ∆ EPS net of hedges Other $0.01 Interest expense ($0.07) 18
Slide 19: Weather Impacts
Weather Impacts PNM: PNM Q2 2023 Q2 2022 Q2 Normal(1) • Q2 2023 temperatures Heating Degree Days 53 15 62 were milder than normal Cooling Degree Days 418 515 507 and Q2 2022 Net EPS Impact ($0.03) ($0.01) $- compared to Normal TNMP: TNMP Q2 2023 Q2 2022 Q2 Normal(1) • Q2 2023 temperatures Heating De
Slide 20: Investment Plan and Rate Base Growth
Investment Plan and Rate Base Growth $1,027 $42 $907 $866 $40 $38 $424 Investment plan through $381 $325 $59 2025 focused on T&D $68 $51 (in millions) infrastructure $503 $452 $391 $320 $419 $362 2023 2024 2025 PNM T&D PNM Generation TNMP IT Depreciation Note: Amounts may not add due to rounding Ave
Slide 21: Balance Sheet and Credit Metrics
Balance Sheet and Credit Metrics
Slide 22: Liquidity as of July 28, 2023
Liquidity as of July 28, 2023 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 7/28/23: Short-term debt and LOC balances 157.6 10.1 144.8 312.5 Remaining availability 282.4 89.9 155.2 527.5 Investe
Slide 23: Selected Balance Sheet Information
Selected Balance Sheet Information (In millions) Dec. 31, 2022 June 30, 2023 Long-Term Debt (incl. current portion) (1) PNM $2,000.9 $2,144.7 TNMP 1,076.9 1,206.2 Corporate/Other 999.6 999.1 Consolidated $4,077.4 $4,350.0 Total Debt (incl. short-term) (1,2) PNM $2,186.8 $2,276.3 TNMP 1,113.6 1,243.3
Slide 24: 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