American Electric Power Company, Inc. · NASDAQ:AEP
American Electric Power — Q3 2024 Earnings Presentation
26 slides from American Electric Power's earnings presentation, Nov 6, 2024
Slide 1: AEP 3rd Quarter 2024 Earnings Presentation
rd AEP 3 Quarter 2024 Earnings Presentation November 6, 2024 3rd Quarter 2024 Earnings Release Presentation 1
Slide 2: Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. Although AEP and each of its Registrant Subsidiaries believe that their expectations are based on reasonable assumptions, any such statements may be influenced by factors t
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial AEP reports its financial results in accordance with accounting principles generally accepted in the United States (GAAP). AEP supplements the reporting of financial information determined in accordance with GAAP with certain non-GAAP financial measures, including operating earnin
Slide 4: Business Highlights for 3rd Quarter 2024
Business Highlights for 3rd Quarter 2024 3rd Quarter 2024 Results • Reported 3rd quarter 2024 operating earnings of $1.85 per share • Narrowed 2024 operating earnings guidance range to $5.58-$5.68, maintained $5.63 midpoint • Realized commercial load growth of 7.9% in 3rd quarter and 10.1% YTD • Com
Slide 5: Investment Profile Driving Long-term EPS Growth Outlook
Investment Profile Operating EPS Guidance Range and Long-Term Growth Outlook Driving Long-term EPS Growth Outlook $8 $7 $5.75 - $5.951 Investment growth in wires $6 $5.58 - $5.68 and regulated new $5 generation investments $4 drive attractive long-term $3 returns $2 1 AEP’s earnings range in 2025 is
Slide 6: AEP Offers an Attractive Investment Opportunity
AEP Offers an Attractive Investment Opportunity 14-15%FFO/Debt Targeted Range COMMITMENT TO: HIGH GROWTH OPPORTUNITY INVESTMENTS SUPPORT ~4% ~8% Rate Base CAGR FINANCIAL STRENGTH Dividend Yield using 2023 Base BEST-IN-CLASS CUSTOMER SERVICE THROUGH INNOVATION AND PROCESS TRANSFORMATION POSITIVE OUTC
Slide 7: Executing Our Strategy to Drive Value for Customers and Investors
Executing Our Strategy to Drive Value for Customers and Investors GROWTH & FINANCIAL STRENGTH CUSTOMER SERVICE REGULATORY INTEGRITY Strategically invest in growth • Innovate and leverage • Respect the preferences of opportunities to support financial technology to enhance service regulators, policym
Slide 8: 3rd Quarter 2024 Financial Update
3rd Quarter 2024 3rd QUARTER 2024 $1.83 $1.80 $1.77 $1.85 Financial Update • Delivered third quarter GAAP earnings of $1.80 per Narrowed 2024 share or $960M operating earnings • Delivered third quarter 2023 2024 2023 2024 2021 2022 2021 2022 guidance range to operating earnings of $1.85 2021 2022 20
Slide 9: 3rd Quarter Operating Earnings
3rd Quarter Operating 0.01 0.01 (0.09) 0.07 Earnings Retail $0.02 Invest Growth $0.02 $1.85 Segment Detail 0.08 Other $(0.01) Wholesale Net Interest $(0.01) $0.02 Per Share O&M $(0.01) $1.77 Rate Changes Normalized $0.07 Income Taxes $(0.01) Net Interest $(0.04) Per Share $(0.03) Other $(0.01) Sales
Slide 10: Load Growth Supports Financial Strength
Load Growth AEP Normalized Residential GWh Sales % Change vs. Prior Year AEP Normalized Commercial GWh Sales % Change vs. Prior Year Supports Financial 4% 24% 20% 23.2% 19.0% 16.1% 2% Strength 0% 0.1% 0.1% 0.3% 16% 12% 8% 10.5% 12.4% 7.9% 10.1% 4.5% 11.1% -0.7% -0.4% 4% -2% -0.9% -1.1% -0.9% -1.7% 0
Slide 11: Capitalization and Liquidity
Total Debt/Total Capitalization 62.9% 63.0% 62.8% 62.6% 62.1% Capitalization FFO to Total Debt (Trailing 12 Months)1 59.8% 61.8% 62.1% and Liquidity 9/30/2024 14.7% Targeted Range 14%-15% 9/30/2024 FFO/Debt was 14.7% and within the 2019 2020 2021 2022 2023 Q1-24 Q2-24 Q3-24 targeted range Short/Long
Slide 12: Appendix: Financial Forecast
Appendix Financial Forecast 3rd Quarter 2024 Earnings Presentation November 6, 2024 3rd Quarter 2024 Earnings Release Presentation 12 12
Slide 13: 2025-2029 Capital Forecast of $54B
Regulated Other Generation Corporate Environmental $1.4B • 3% $3.8B • 7% 2025-2029 Capital Generation Forecast of $54B $0.3B • 0% Nuclear Generation 100% of capital allocated to $0.5B • 1% regulated businesses The ability to quickly Regulated New Generation redeploy transmission and distribution inv
Slide 14: Maintaining a Strong Balance Sheet Through Strategic Financing
Maintaining a Strong FINANCING PLAN Balance Sheet Through Strategic $ in millions 2025E-2029E Financing Cash from Operations $41,500 Less: Capital Investments (54,400) Strong balance sheet with Less: Dividends1 (11,300) targeted FFO/Debt of 14%- 15%; Debt to Capitalization Less: Other Investing Acti
Slide 15: Appendix: Q3-24 Performance
Appendix Q3-24 Performance 3rd Quarter 2024 Earnings Presentation November 6, 2024 3rd Quarter 2024 Earnings Release Presentation 15 15
Slide 16: YTD Operating Earnings Segment Detail
YTD Operating Earnings 0.07 0.03 (0.03) $4.38 Per Share 0.20 Segment Detail Renewables $(0.06) Net Interest $(0.13) Invest Growth $0.04 Retail $0.02 Income Taxes $0.02 0.09 Other $0.03 Wholesale $0.05 Other Operating Income $0.03 Key Drivers YTD-24 vs. $4.02 Rate Changes $0.12 Net Interest Income Ta
Slide 17: Regulated Returns
Regulated Twelve Months Ended 9/30/2024 Earned ROE’s (non-GAAP operating earnings, not weather normalized) Returns 14% 12% Regulated operations ROE as 11.4% 10.8% of 9/30/2024 of 9.0% 10% 9.7% 9.2% 1 Base rate cases pending/order recently received. 8% 7.7% 7.5% 7.4% Sphere size is based on each comp
Slide 18: Current Rate Case Activity
Current Rate Case Activity APCo – AEP Texas APCo – Virginia West Virginia1 PSO – Oklahoma Docket # 56165 Docket # PUR-2024-00024 Docket # 24-0854-E-42T Docket # PUD 2023-000086 Achieve positive Filing Date 2/29/2024 Filing Date 3/29/2024 Filing Date 11/1/2024 Filing Date 1/31/2024 regulatory outcome
Slide 19: FFO to Total Debt
FFO to Total Debt1 FFO Calculation (in millions) 12 Months Ended 9/30/2024 Cash Flow from Operations (GAAP) $ 6,414 Changes in Working Capital (54) FFO to Total Debt = 14.7% Operating Lease Depreciation 123 $6,381M FFO / $43,569M Capitalized Interest (126) Adjusted Total Debt Junior Subordinated Deb
Slide 20: 3rd Quarter Reconciliation of GAAP to Operating Earnings
$ in millions Earnings Per Share 3rd Quarter Q3-23 Q3-24 Change Q3-23 Q3-24 Change Reconciliation of Reported GAAP Earnings $ 954 $ 960 $6 $ 1.83 $ 1.80 $ (0.03) GAAP to Operating Non-Operating Items: Earnings SEC Contingency1 - 19 19 - 0.04 0.04 Mark-to-Market Impact of Commodity (30) 6 36 (0.06) 0
Slide 21: YTD Reconciliation of GAAP to Operating Earnings
$ in millions Earnings Per Share YTD Reconciliation YTD-23 YTD-24 Change YTD-23 YTD-24 Change Reported GAAP Earnings $ 1,872 $ 2,303 $ 431 $ 3.62 $ 4.35 $ 0.73 of GAAP to Non-Operating Items: Operating Earnings Impact of Net Operating Losses Carryforward on Retail Rate Making1 - (260) (260) - (0.50)
Slide 22: Vertically Integrated Utilities 3rd Quarter Performance
Vertically Integrated Utilities 3rd Quarter Performance RATE PERFORMANCE WEATHER IMPACT RETAIL LOAD PERFORMANCE Rate Changes, net Weather Impact Retail Load1 of offsets ($ in millions) (weather normalized) ($ in millions) Q3-24 vs. Q3-24 vs. Q3-24 vs. Q3-23 Q3-24 vs. Q3-23 Q3-23 Normal APCo3 $38 APC
Slide 23: Vertically Integrated Utilities YTD Performance
Vertically Integrated Utilities YTD Performance RATE PERFORMANCE WEATHER IMPACT RETAIL LOAD PERFORMANCE Rate Changes, net Weather Impact Retail Load1 of offsets ($ in millions) (weather normalized) ($ in millions) YTD-24 vs. YTD-24 vs. YTD-24 vs. YTD-23 YTD-24 vs. YTD-23 YTD-23 Normal APCo3 $82 APCo
Slide 24: Transmission and Distribution Utilities 3rd Quarter Performance
Transmission and Distribution Utilities 3rd Quarter Performance RATE PERFORMANCE WEATHER IMPACT RETAIL LOAD PERFORMANCE Rate Changes, net Weather Impact Retail Load1 of offsets ($ in millions) (weather normalized) ($ in millions) Q3-24 vs. Q3-24 vs. Q3-23 Normal Q3-24 vs. Q3-23 Q3-24 vs. Q3-23 AEP O
Slide 25: Transmission and Distribution Utilities YTD Performance
Transmission and Distribution Utilities YTD Performance RATE PERFORMANCE WEATHER IMPACT RETAIL LOAD PERFORMANCE Rate Changes, net Weather Impact Retail Load1 of offsets ($ in millions) (weather normalized) ($ in millions) YTD-24 vs. YTD-24 vs. YTD-23 Normal YTD-24 vs. YTD-23 YTD-24 vs. YTD-23 AEP Oh
Slide 26: 3 rd Quarter 2024 Earnings Release Presentation
3rd Quarter 2024 Earnings Release Presentation 26
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