Dte Energy Company · NYSE:DTE
Dte Energy — Q2 2019 Earnings Presentation
20 slides from Dte Energy's earnings presentation, Jul 24, 2019
Slide 1: 2Q 2019 Earnings Conference Call
2Q 2019 Earnings Conference Call July 24, 2019
Slide 2: Safe Harbor Statement
Safe Harbor Statement Many factors impact forward-looking statements including, but not limited to, the following: impact of regulation by the EPA, the FERC, the MPSC, the NRC, and for DTE Energy, the CFTC, as well as other applicable governmental proceedings and regulations, including any associate
Slide 3: Participants
Participants • Gerry Anderson – Executive Chairman • Jerry Norcia – President and CEO • Peter Oleksiak – Senior Vice President and CFO • Barbara Tuckfield – Director, Investor Relations 3
Slide 4: Increasing 2019 operating EPS guidance due to a strong start to the year
Increasing 2019 operating EPS* guidance due to a strong start to the year • Raising 2019 operating EPS guidance range to $6.02 – $6.38 • Targeting 5% – 7% operating EPS growth from 2019 original guidance through 2023 • Business update ‒ DTE Electric: implementing Charging Forward program for electri
Slide 5: Reliability investments at utilities support growth plan and increase customer satisfaction
Reliability investments at utilities support growth plan and increase customer satisfaction DTE Electric • Progressing on regulatory front ‒ Filed rate case in July ‒ Received constructive order on renewable energy plan • Launched Charging Forward program to promote electric vehicle education, infra
Slide 6: Strategic non-utility opportunities support strong future growth
Strategic non-utility opportunities support strong future growth Gas Storage & Pipelines • Acquired an additional 30% of Link-SGG, increasing ownership from 55% to 85% • Acquiring Generation Pipeline, a supplier of natural gas to power and industrial customers in Ohio ‒ Closing 2H 2019 • Progressing
Slide 7: 2Q 2019 operating earnings variance
2Q 2019 operating earnings* variance (millions, except EPS) 2Q 2018 2Q 2019 Change Primary Drivers Weather and rate base growth costs offset by DTE Electric $ 163 $ 134 $ (29) new rates A timing item in 2018, weather and rate base DTE Gas 14 4 (10) growth costs offset by new rates Transition from AF
Slide 8: Increasing 2019 operating EPS guidance midpoint by $0.05
Increasing 2019 operating EPS* guidance midpoint by $0.05 (millions, except EPS) Original Guidance Revised Guidance DTE Electric $698 - $712 $703 - $717 DTE Gas 171 - 179 175 - 183 Gas Storage & Pipelines 208 - 218 208 - 218 Power & Industrial Projects 119 - 134 119 - 134 Energy Trading 15 - 25 15 -
Slide 9: We are on track to continue delivering strong results for customers and shareholders
We are on track to continue delivering strong results for customers and shareholders Total Shareholder Return* (Annualized) 19% • Raising 2019 operating earnings** guidance; on track to beat original guidance for 11th consecutive year 14% 14% 12% 12% • Targeting 5% - 7% operating 11% EPS growth and
Slide 10: Contact Us
CONTACT US DTE Investor Relations www.dteenergy.com/investors 313.235.8030 10
Slide 11: Appendix
Appendix 11
Slide 12: Cash flow and capital expenditures actuals
Cash flow and capital expenditures actuals (billions) (millions) Cash Flow Capital Expenditures YTD 2018 YTD 2019 YTD 2018 YTD 2019 DTE Electric Cash From Operations* $1.4 $1.4 Base Infrastructure $350 $316 Capital Expenditures (1.4) (1.8) New Generation 74 318 Free Cash Flow $0.0 ($0.4) Distributio
Slide 13: Cash flow and capital expenditures guidance
Cash flow and capital expenditures guidance (billions) (millions) Cash Flow Capital Expenditures 2019 2019 Guidance Guidance Cash From Operations* $2.4 DTE Electric Capital Expenditures (3.9) Base Infrastructure $820 Free Cash Flow ($1.5) New Generation 490 Distribution Infrastructure 890 $2,200 Div
Slide 14: Maintaining strong cash flow and balance sheet
Maintaining strong cash flow and balance sheet • Issuing $1.0 – $1.5 billion of equity in 2019 – 2021 ‒ Up to $250 million of equity in Funds from Operations* / Debt** 2019 using internal mechanisms; ~$165 million issued through 2Q Target • Supporting capital investments Target 18% with strong cash
Slide 15: Weather and DTE Electric weather normal sales
Weather and DTE Electric weather normal sales Cooling degree days – DTE Electric service territory Heating degree days – DTE Gas service territory 2Q 2018 2Q 2019 % change 2Q 2018 2Q 2019 % change Actuals 323 150 (54%) Actuals 860 859 0% Normal 215 215 0% Normal 774 777 0% Deviation from normal 50%
Slide 16: DTE Electric and DTE Gas regulatory update
DTE Electric and DTE Gas regulatory update DTE Electric DTE Gas • General rate case - order received • General rate case - order received May 2019 (U-20162) September 2018 (U-18999) – Effective: May 2019 – Effective: October 2018 – Rate recovery: $273 million – Rate recovery: $47 million – ROE: 10.0
Slide 17: 2Q and YTD Energy Trading reconciliation of operating earnings to economic net income
2Q and YTD Energy Trading reconciliation of operating earnings* to economic net income (millions) 2Q 2018 2019 • Economic net income equals economic Operating Earnings $8 ($2) gross margin*** minus O&M expenses and taxes Accounting Adjustments** 7 5 • DTE Energy management uses economic Economic Net
Slide 18: Reconciliation of reported to operating earnings
Reconciliation of reported to operating earnings (non-GAAP) Use of Operating Earnings Information – DTE Energy management believes that operating earnings provide a more meaningful representation of the company’s earnings from ongoing operations and uses operating earnings as the primary performance
Slide 19: Reconciliation of reported to operating earnings
Reconciliation of reported to operating earnings (non-GAAP) Use of Operating Earnings Information – DTE Energy management believes that operating earnings provide a more meaningful representation of the company’s earnings from ongoing operations and uses operating earnings as the primary performance
Slide 20: Reconciliation of reported to operating earnings
Reconciliation of reported to operating earnings (non-GAAP) Use of Operating Earnings Information – Operating earnings exclude non-recurring items, certain mark-to- market adjustments and discontinued operations. DTE Energy management believes that operating earnings provide a more meaningful repres