Duke Energy Corporation (holding Company) · NYSE:DUK
Duke Energy Corporation (holding Company) — Investor Day (February 2013)
32 slides from Duke Energy Corporation (holding Company)'s investor day presentation, February 2013
Slide 1: Financial Overview
Analyst Meeting 2013 Financial Overview Lynn Good, Executive VP and Chief Financial Officer
Slide 2: Key takeaways
Key takeaways – Duke Energy’s low-risk, predominantly-regulated business model generates reliable earnings and cash flows – Duke Energy has consistently met its operational and financial objectives – Duke Energy has unique strengths on which to build for the future 56 | Analyst Meeting 2013
Slide 3: 2013 earnings guidance and long-term expectations
2013 earnings guidance and long-term expectations 2013 earnings Long-term Dividend growth guidance earnings growth within target range of of 4-6% (1) payout ratio of $4.20 - $4.45 (1) from 2013 to 2015 65-70% (1) (1) Based upon adjusted diluted EPS 57 | Analyst Meeting 2013
Slide 4: 2013 key EPS drivers
2013 key EPS drivers (1) $4.20 - USFE&G INTERNATIONAL $4.32 $4.45 ▲Full year of Progress ▼Unfavorable FX and hydrology earnings in Brazil ▲Regulatory outcomes, net of ▼Lower commodity prices at NMC recoverables ▲Retail load growth of ~0.5% COMMERCIAL POWER ▲Growth in wholesale ▲Lower PJM capacity re
Slide 5: Capital expenditures profile 2013 – 2015
Capital expenditures profile 2013 – 2015 ($ in millions) $5.9 - 6.3B $5.8 - 6.4B $6.0B $5.4 - 6.0B $425 $600 $575 $625 $350 $1,725 $375 Duke Energy Discretionary $5,300 $5,025 $5,400 Commercial $4,225 Businesses & Other USFE&G 2012A(1) 2013E 2014E 2015E 2% 6% U.S. FE&G 9% 11% Maintenance 9% 9% 11% 1
Slide 6: USFE&G projected year-end earnings base growth
USFE&G projected year-end earnings base growth $48.5B $49.9B $47.1B $44.9B 2012A 2013E 2014E 2015E Carolinas Florida Midwest Notes: Illustrative earnings base for presentation purposes only and includes retail and wholesale; Amounts as of the end of each year shown and exclude CR3; Projected earning
Slide 7: Credit profile summary and 2013 cash flows
Credit profile summary and 2013 cash flows Credit metrics summary 2013E Target ($ in millions) 2013E FFO / Debt 18% 18% - 22% Adjusted net income (2) $ 3,050 FFO Interest Coverage 5.1x 3.5x – 4.0x Depreciation & amortization 3,380 Deferred and accrued taxes 1,700 Debt to Capitalization ~50% 47% - 50
Slide 8: 2013 debt maturities and issuances
2013 debt maturities and issuances (1)(2) ($ in millions) $1,400 $500 million hybrid $1,200 issued in January 2013 $1,000 $800 $600 $400 $200 $- Duke Progress Duke Duke Progress Duke International Renewables (4) Energy Carolinas Indiana Carolinas Florida (3) Ohio (HoldCo) Maturities Issuances Certai
Slide 9: Long-term adjusted earnings growth of 4 - 6% through 2015
Long-term adjusted earnings growth of 4 - 6% through 2015 Adjusted diluted EPS summary (1)(2) Long-term segment earnings drivers USFE&G ― Continued investment in regulated fleet: resulting in earnings base growth of 4% 6% growth ― Full benefit of 2013 rate cases in 4% growth 2014 $4.38 ― Load growth
Slide 10: Continued dividend growth
Continued dividend growth – Dividend supported by strong DUK Annual Dividend Per Share History regulated earnings base – 87-year history of consecutive quarterly cash dividends – Current dividend yield of 4.4% – Duke Energy dividend policy: –Grow dividend, but at a lower rate than growth in adjusted
Slide 11: Our financial objectives for 2013 and beyond
Our financial objectives for 2013 and beyond Current year Long-term Balance Dividend earnings earnings sheet growth guidance growth strength – Achieve 2013 – Deliver earnings – Continue growing – Maintain strong, earnings within growth of 4 - 6% (1) the dividend within investment-grade guidance rang
Slide 12: How Duke Energy delivers on its promises
How Duke Energy delivers on its promises EXCEL IN THE FUNDAMENTALS Operational Customer Financial Constructive Excellence Satisfaction Discipline Regulation LEVERAGE OUR UNIQUE STRENGTHS Strategic Scale Diversity Geography Flexibility 66 | Analyst Meeting 2013
Slide 13: Appendix materials
Appendix materials A-1 | Analyst Meeting 2013
Slide 14: 2013 guidance support
2013 guidance support A-2 | Analyst Meeting 2013
Slide 15: Business segment structure
Business segment structure DUKE ENERGY U.S. FRANCHISED COMMERCIAL ELECTRIC AND GAS INTERNATIONAL POWER North and South Duke Energy Duke Carolinas Carolina Renewables North and South Duke Energy Progress Carolinas Carolina Retail Progress Florida Florida Duke Indiana Indiana Ohio T&D Midwest Coal Gen
Slide 16: 2013 adjusted earnings drivers
2013 adjusted earnings drivers US FE&G International Commercial Other Share Power Dilution $0.95 ($0.05) $0 ($0.10) ▼ Unfavorable ($0.80) ▼ Lower PJM FX and capacity ▼ Full year of hydrology in revenues interest Brazil ▲ Ohio cost- expense on ▼ Lower based Progress commodity HoldCo debt capacity fil
Slide 17: Additional 2013 earnings guidance details
Additional 2013 earnings guidance details ($ in millions) 2012 2013 MEMO: 2013 Interest MEMO: 2013 Adj. Actual Assumptions Expense, Net Effective Tax Rate Adjusted Segment Income (Expense) (1): USFE&G $2,086 $2,755 $1,020 38% International $439 $405 $80 29% Commercial Power $93 $95 $70 (227%) (2) Ot
Slide 18: Key 2013 earnings sensitivities
Key 2013 earnings sensitivities Driver EPS Change USFE&G 100 bps change in earned return on equity +/- $0.37 $1 billion change in rate base +/- $0.08 1% change in USFE&G volumes +/- $0.09 International 10% change in BRL/US$ foreign exchange rate +/- $0.03 $10/barrel change in crude oil prices +/- $0
Slide 19: 2013 pension funding and costs
2013 pension funding and costs – Duke Energy’s pension funding policy: Pension Costs 2011A 2012A 2013E – The company is committed to funding its pension ($ in millions) obligations Duke Energy plans (1) $59 $76 $114 – The company’s policy is to fund at least the minimum Progress Energy plans $74 $10
Slide 20: USFE&G weather-normalized volume trends
USFE&G weather-normalized volume trends ( in % change since prior year) Residential Commercial 0.7% ~0.7% 0.1% ~0.1% -0.1% -0.2% 2011A 2012A 2013E 2011A 2012A 2013E Industrial USFE&G Total 1.2% 1.0% ~1.0% 0.6% ~0.5% 0.2% 2011A 2012A 2013E 2011A 2012A 2013E A-8 | Analyst Meeting 2013
Slide 21: USFE&G quarterly weather impacts
USFE&G quarterly weather impacts ($ and shares in millions) 2012A Weather Segment Income to Normal: EPS Impact – Favorable / (Unfavorable) Pre-tax Weighted Avg. EPS Impact Diluted Shares O/S First Quarter ($80) 446 ($0.12) Second Quarter $20 446 $0.03 Third Quarter (1) $20 699 $0.02 Fourth Quarter (
Slide 22: USFE&G earnings base
USFE&G earnings base (1) ($ in billions) 2012A 2013E 2014E 2015E Duke Carolinas $15.8 $16.8 $17.1 $17.5 Progress Carolinas 9.7 10.1 10.8 11.3 Progress Florida (2) 8.5 8.9 8.8 9.1 Duke Indiana (3) 7.9 8.1 8.3 8.2 Duke Ohio 2.2 2.4 2.6 2.8 Duke Kentucky 0.8 0.8 0.9 1.0 USFE&G Total $44.9 $47.1 $48.5 $
Slide 23: Capital expenditures profile
Capital expenditures profile (1) ($ in millions) 2012A 2013E 2014E 2015E 2013-2015 Total Edwardsport IGCC $ 250 $ 100 $ - $ - $ 100 Cliffside 150 25 - - 25 CC / CT Additions 300 275 175 500 950 Environmental 100 325 450 600 1,375 Nuclear Fuel 400 475 525 525 1,525 Nuclear Projects 225 450 600 575 1,
Slide 24: Select USFE&G capital expenditures, by legal entity
Select USFE&G capital expenditures, by legal entity (1) ($ in millions) 2012A 2013E 2014E 2015E 2013-2015 Total Duke Carolinas $ 150 $ 75 $ 75 $ 250 $ 400 Progress Carolinas 125 125 25 25 175 Progress Florida 25 75 50 150 275 Duke Kentucky - - 25 75 100 Total CC / CT Additions $ 300 $ 275 $ 175 $ 50
Slide 25: Select USFE&G capital expenditures, by legal entity (cont.)
Select USFE&G capital expenditures, by legal entity (1) (cont.) ($ in millions) 2012A 2013E 2014E 2015E 2013-2015 Total Duke Carolinas $ 25 $ 50 $ 75 $ 100 $ 225 Progress Carolinas - 25 25 25 75 Progress Florida 25 50 75 75 200 Duke Ohio 75 75 - - 75 Duke Kentucky - - 25 25 50 Total Grid Modernizati
Slide 26: Financial overview
Financial overview A-14 | Analyst Meeting 2013
Slide 27: Simplified financing structure
Simplified financing structure Duke Energy (HoldCo) Cinergy Corp. Duke Energy Progress Energy (HoldCo) International (HoldCo) (1) Duke Energy Duke Energy Duke Energy Progress Progress Carolinas Ohio Indiana Carolinas Florida Duke Energy Commercial Paper and LT Financings Duke Energy Money Pool and L
Slide 28: Near-term debt maturities
Near-term debt maturities (1) ($ in millions) 2013 $559 $405 $425 $405 $259 $194 $59 $404 $2,710 2014 $1,550 $408 $42 $93 $97 $45 $2,240 2015 $450 $700 $550 $137 $98 $505 $2,450 Duke Energy Progress Carolinas Progress Florida Duke Indiana Duke Ohio Duke Kentucky International Other Duke Carolinas (1
Slide 29: Credit metrics
Credit metrics (1) FFO/Debt (2)(3) Consolidated 28% 29% Target = 25% 25% 24% 24% 23% 18.0% - 22.0% 19% 20% 19% 19% 20% 18% 18% 18% 14% 15% 13% 2011A 2012A 2013E 2011A 2012A 2013E 2011A 2012A 2013E 2011A 2012A 2013E 2011A 2012A 2013E 2011A 2012A 2013E Duke Carolinas Progress Carolinas Progress Florid
Slide 30: Liquidity summary (as of December 31, 2012)
Liquidity summary (as of December 31, 2012) ($ in millions) Duke Duke Progress Progress Duke Duke Energy Carolinas Carolinas Florida Indiana Duke Ohio Kentucky Total Master Credit Facility (1) $ 1,750 $ 1,250 $ 750 $ 750 $ 750 $ 650 $ 100 $ 6,000 (2) Less: Notes Payable and Commercial Paper (350) (3
Slide 31: Credit ratings (as of February 22, 2013)
Credit ratings (as of February 22, 2013) Holding Companies Operating Companies Fitch Moody's S&P Fitch Moody's S&P DUKE ENERGY Stable Stable Negative DUKE CAROLINAS Stable Stable Negative Corporate Credit / Issuer Rating BBB+ Baa2 BBB+ Senior Secured Debt A+ A1 A Senior Unsecured Debt BBB+ Baa2 BBB
Slide 32: For additional information on Duke Energy, please visit
For additional information on Duke Energy, please visit: www.duke-energy.com/investors