Slide 1: Fortis
fe) Z FORTIS
Slide 2: Forward-Looking Information
Forward-Looking Information Fortis includes "forward-looking information" in this presentation within the meaning of applicable Canadian securities laws and "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, collectively referred to as "forw
Slide 3: Barry Perry, President & CEO
Barry Perry Fortis Inc. - President & CEO
Slide 4: 2018 At A Glance – Executing on Organic Growth Strategy
2018 At A Glance – Executing on Organic Growth Strategy Invested $3.2B 20% Increase in 5-YR Capital Plan at Our Regulated Utilities Commenced Asset Sale Process Delivered EPS of $2.59 2018 Dividend Increase of 5.9% Transitioned Key Leadership Positions 1st Sustainability Report 6% Dividend Guidance
Slide 5: Asset Sale Funding Complete With Waneta Expansion Sale
Asset Sale Funding Complete With Waneta Expansion Sale Definitive agreement with Colombia Power Corporation and Columbia Basin Trust to purchase 51% ownership for ~$1 Billion Transaction expected to close in Q2 2019 Expected to improve our credit metric outlook Asset sale component of the 5-year fun
Slide 6: Strong Financial Track Record
Strong Financial Track Record Adjusted EPS and Dividend Payout Ratio 2018 Key Statistics $2.51 8,800 Employees $2.47 $2.33 $2.11 $8.4B Revenues $1.75 69% $1.1B Net Earnings 73% 66% 65% 66% Strong Rate Base Growth 2014 2015 2016 2017 2018 6% 2018 Rate Base Growth Adjusted EPS(2) Dividend Payout Ratio
Slide 7: Consistently Delivering Superior Total Shareholder Returns
Consistently Delivering Superior Total Shareholder Returns 1-Year 5-Year 10-Year 20-Year 2.8% 12.6% 10.5% 12.4% -8.8% 4.1% 7.9% 6.6% -7.7% 6.1% 7.2% 7.9% Fortis S&P/TSX Composite Index S&P/TSX Capped Utilities Index Note: For the period ending December 31, 2018. 7
Slide 8: Capital Plan of $17.3B Reaffirmed
Capital Plan of $17.3B Reaffirmed Regulated 99% U.S. 55% Canada 42% $17.3B 5-Year Capital Plan Non-Regulated 1% Caribbean 3% 8
Slide 9: Rate Base to Reach $35.5 Billion in 2023
Rate Base to Reach $35.5 Billion in 2023 Rate Base(1) $35.5 $32.0 $33.4 $30.1 $27.9 $26.1 Canadian & Caribbean Billions U.S. 2018A 2019F 2020F 2021F 2022F 2023F (1) US dollar-denominated rate base for 2018 is based on the actual average USD/CAD foreign exchange rate of $1.30 and forecast rate base f
Slide 10: 45 Years of Dividend Growth
45 Years of Dividend Growth (1) 6% guidance generates annual dividend payment of $2.27 in 2023 73 75 77 79 81 83 85 87 89 91 93 95 97 99 01 03 05 07 09 11 13 15 17 19F 21F 23F Actual dividend paid Forecasted dividend payments (1) Based on an annualized dividend of $1.70 in 2018. 10
Slide 11: Jocelyn Perry, EVP, CFO
Jocelyn Perry Fortis Inc. – EVP, CFO
Slide 12: Strong 2018 Results
Strong 2018 Results Reported EPS $2.59 Reported Annual $0.61 EPS Increased $2.32 $0.27 to $2.59 $0.32 Aitken Creek Q4 2017 Q4 2018 2017 2018 Mark-to-Market Removed From Adjusted EPS(1) $2.51 Adjusted Earnings $2.47 $0.58 $0.56 Adjusted Annual EPS up $0.04 despite Q4 2017 Q4 2018 2017 2018 Tax Reform
Slide 13: EPS Drivers – Q4
EPS Drivers – Q4 Increased ~5% Absent Tax & ROE Impacts U.S. Tax Reform & ITC ROE Impacts ($0.03) $0.01 ($0.01) $0.01 ($0.01) $0.01 ($0.02) $0.02 $0.58 $8.4 $0.56 $9.8 Q4 2017 Adjusted U.S. ITC Independence Corporate U.S. Transmission Foreign Energy Canadian & U.S. Q4 2018 Adjusted EPS (1) Tax Refor
Slide 14: EPS Drivers – Annual 2018
EPS Drivers – Annual 2018 Increased ~5% Absent Tax & ROE Impacts U.S. Tax Reform & ITC ROE Impacts $0.02 ($0.02) $0.02 $0.04 ($0.05) $1.91 $0.05 ($0.02) $2.51 $2.47 $8.4 Annual 2017 U.S. Tax ITC Independence U.S. Energy U.S. Electric Canadian & Corporate Annual 2018 (1) Adjusted EPS Reform Adder Tra
Slide 15: Effective Funding Plan For 5-Year Capital Program
Effective Funding Plan For 5-Year Capital Program Cash From Operations(1) 68% $17.3B DRIP is Only Equity Required to Fund $17.3B 5-Year Capital Plan 5-Year Capital Plan Waneta Expansion Regulated Debt Sale Completes Asset 24% Sale Funding Other(2) Asset Sales Requirement 2% 6% (1) Cash from operatin
Slide 16: Strengthening Our Credit Profile
Strengthening Our Credit Profile Improved Improving Credit Holdco Debt / Total Debt Metrics Over The 5-Year Plan 38% CFO / Debt 33% Expected to be > 11% in 2019 ATM Program Provides Financial Flexibility 2018A 2019F 2020F 2021F 2022F 2023F 16
Slide 17: Regulatory Outlook
Regulatory Outlook Recent Decisions: MISO Independence Incentive Adder Complaint • Adder reduced to 0.25% effective April 20, 2018 • ITC filed a request for rehearing MISO Base ROE Complaints • FERC established new methodology and requested briefs from utilities in first half of 2019 on proposed ado
Slide 18: Why Invest In Fortis?
Why Invest In Fortis? Well-Run Utilities Virtually All Regulated Highly Diversified Strong Growth Profile 6% Dividend Guidance Opportunities Beyond Capital Plan 18
Slide 19: Expected Upcoming Events
Expected Upcoming Events Save the Date Investor Day at ITC September 10, 2019 Expected Upcoming Earnings Release Dates Q1 – 2019 May 1, 2019 Q2 – 2019 August 2, 2019 19
Slide 20: Fortis
fe) Z FORTIS
Slide 21: Fortis
fe) Z FORTIS
Slide 22: Q4 2018 Results by Segment
Q4 2018 Results by Segment APPENDIX Fourth Quarter 2018 Variance Analysis by Segment ($millions, excluding weighted Adjusted Q4 Adjusted Q4 Adjusted Q4 Q4 2018 Adjustments (1) Q4 2017 Adjustments (1) average shares and EPS) 2018 2017 Variance Regulated – Independent Electric Transmission ITC 92 - 92
Slide 23: Annual 2018 Results by Segment
Annual 2018 Results by Segment APPENDIX Annual 2018 Variance Analysis by Segment ($millions, excluding weighted Adjusted Adjusted Adjusted 2018 Adjustments (1) 2017 Adjustments (1) average shares and EPS) 2018 2017 Variance Regulated – Independent Electric Transmission ITC 361 - 361 272 91 363 (2) R
Slide 24: Adjusted Earnings Reconciliation
Adjusted Earnings Reconciliation APPENDIX Non-US GAAP Reconciliation ($millions, excluding weighted average shares and EPS) Q4 2018 Q4 2017 Variance 2018 2017 Variance Net Earnings Attributable to Common Equity Shareholders 261 134 127 1,100 963 137 Adjusting Items: U.S. Tax Reform(1) - 146 (146) -
Slide 25: 2019-2023 Capital Forecast by Segment
2019-2023 Capital Forecast by Segment APPENDIX Capital Forecast(1) 2019-2023 ($millions) 2019 2020 2021 2022 2023 Total Regulated - Independent Electric Transmission ITC 865 878 951 943 861 4,498 Regulated - US Electric & Gas UNS Energy 1,076 875 624 476 476 3,527 Central Hudson 280 268 276 291 274
Slide 26: Major Capital Projects
Major Capital Projects AAPPPPEENNDDIIXX Total Expected Year 2019 Significant Capital Projects ($millions) 2019-2023 of Forecast Plan Completion Capital Plan By Project Type ITC Multi-Value Regional Transmission Projects 88 332 2023 ITC 34.5 kV to 69 kV Transmission Conversion Project 87 348 Post-202
Slide 27: 2018-2023 Rate Base by Segment
2018-2023 Rate Base by Segment APPENDIX (1) Rate Base 3-Year CAGR 5-Year CAGR ($billions) 2018A 2019F 2020F 2021F 2022F 2023F to 2021 to 2023 Regulated - Independent Electric Transmission ITC 7.8 8.5 9.1 9.7 10.3 10.8 7.7% 6.8% Regulated - US Electric & Gas UNS Energy 4.7 5.3 6.0 6.3 6.4 6.6 10.1% 6