American Electric Power Company, Inc. · NASDAQ:AEP
American Electric Power — Q3 2012 Earnings Presentation
19 slides from American Electric Power's earnings presentation, Oct 24, 2012
Slide 1: 3Q12 Earnings Release Presentation
3Q12 Earnings Release Presentation October 24, 2012
Slide 2: Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
“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
Slide 3: Third Quarter 2012 Highlights
Third Quarter 2012 Highlights 3rd Quarter Financial Performance $2.50 Delivered GAAP and Operating earnings of $1.00 and $1.92 $1.02 per share, respectively, for the third quarter and $2.00 $2.55 and $2.59 per share, respectively, for the nine month YTD period $1.50 GAAP EPS $1.17 $1.00 $1.02
Slide 4: 3Q12 Performance
3Q12 Performance 3Q12 Performance Drivers Third Quarter Reconciliation Ohio Customer Switching and Capacity Operating unfavorable $46M from prior year Earnings EPS ($ in millions) Unfavorable carrying costs income due to TCC True-Up Remand recorded in 2011 3Q11 $ 1.17 $566 Customer Switching and
Slide 5: September YTD 2012 Performance
September YTD 2012 Performance YTD 2012 Performance Drivers September YTD Reconciliation Ohio Customer Switching and Capacity Operating unfavorable $144M from prior year. As of Earnings September 2012, 42% of total load switched EPS ($ in millions) Weather was unfavorable by $119M vs. prior 2011
Slide 6: Normalized Load Trends
Normalized Load Trends AEP Residential Normalized GWh Sales AEP Commercial Normalized GWh Sales %Change vs. Prior Year %Change vs. Prior Year 15% 15% 10% 10% 5% 5% 1.6% -0.1% 0.3% 0.5% 0.1% 0.5% 0% 0% -0.5% -0.4% -1.9% -1.7% -1.0% -5% -2.8% -5% 3Q11 4Q11 1Q12 2Q12 3Q12 YTD12 3Q11 4Q11 1Q12 2Q12 3Q12
Slide 7: Industrial Sales Volumes
Industrial Sales Volumes AEP Industrial GWh by Sector GWh 2,000 These 5 sectors account for Primary Metal Manufacturing approximately 60% of AEP's total Chemical Manuf acturing 1,800 Industrial Sales. Petroleum and Coal Products Manufacturing Mining (except Oil & Gas) Paper Manuf acturing Industry 3
Slide 8: Coal to Gas Switching
Coal to Gas Switching 3rd Quarter 11 vs. 12 Capacity Factor YTD 11 vs. 12 Capacity Factor East West East West 100.0% 100.0% 90.0% 87.5% 90.0% 82.7% 3Q11 3Q12 78.9% YTD11 YTD12 74.9% 80.0% 80.0% 67.3% 70.0% 62.0% 70.0% 66.9% 61.2% 55.8% 60.0% 60.0% 49.2% 50.0% 50.0% 42.4% 40.6% 37.6% 36.5% 40.0% 40.0
Slide 9: Capitalization & Liquidity
Capitalization & Liquidity 70.0% Total Debt / Total Capitalization 62.5% 60.0% 57.2% 57.0% 55.3% 55.3% 55.2% 54.6% Credit Statistics 50.0% Actual Target 40.0% FFO Interest Coverage 4.8 >3.6x FFO To Total Debt 19.9% 15%- 20% 30.0% Note: Credit statistics represent the trailing 12 months as of 09/30/2
Slide 10: Upcoming Items
Upcoming Items 2012 2013 November December January February March • FERC Filing Corporate Separation – OCT/NOV • EEI – NOV 11-14 Rehearing on Ohio Orders • Indiana Rate Order - DEC • Turk Coal Plant Operational - DEC • 4Q12 - Earnings • Analyst Day (Anticipated) OH/WV Securitizations 10
Slide 11: Questions
Questions 11
Slide 12: Reconciliation of GAAP to Operating Earnings
Reconciliation of GAAP to Operating Earnings $ millions Earnings Per Share 3rd Qtr 3rd Qtr 3rd Qtr 3rd Qtr 2011 2012 Change 2011 2012 Change Reported Earnings (GAAP) $ 928 $ 487 $ (441) $ 1.92 $ 1.00 $ (0.92) Special Items: Turk Plant Impairment - 9 9 - 0.02 0.02 Carbon Capture & Storage 5 - (5) 0.0
Slide 13: Reconciliation of GAAP to Operating Earnings
Reconciliation of GAAP to Operating Earnings $ millions Earnings Per Share Sept YTD Sept YTD Sept YTD Sept YTD 2011 2012 Change 2011 2012 Change Reported Earnings (GAAP) $ 1,633 $ 1,238 $ (395) $ 3.39 $ 2.55 $ (0.84) Special Items: Turk Plant Impairment - 9 9 - 0.02 0.02 Cost Restructuring Program (
Slide 14: Quarterly Performance Comparison
Quarterly Performance Comparison American Electric Power Financial Results for 3rd Quarter 2012 Actual vs 3rd Quarter 2011 Actual 2011 GAAP 2011 Operating 2012 GAAP 2012 Operating 2011 Volumes Earnings Adjustments Earnings 2012 Volumes Earnings Adjustments Earnings (GWh) ($ millions) ($ millions) ($
Slide 15: YTD Performance Comparison
YTD Performance Comparison American Electric Power Financial Results for YTD September 2012 Actual vs YTD September 2011 Actual 2011 GAAP 2011 Operating 2012 GAAP 2012 Operating 2011 Volumes Earnings Adjustments Earnings 2012 Volumes Earnings Adjustments Earnings (GWh) ($ millions) ($ millions) ($ m
Slide 16: Retail Rate Performance
Retail Rate Performance Rate Changes, net of Rate Changes, net of trackers (in millions) trackers (in millions) 3Q12 vs. 3Q11 YTD12 vs. YTD11 East Regulated East Regulated $5 Integrated $18 Integrated Utilities Utilities Ohio Companies Ohio Companies $16 ($25) (Includes POLR) (Includes POLR) West Re
Slide 17: 3Q12 Retail Performance
3Q12 Retail Performance Retail Load* Weather Impact (weather normalized) (in millions) 3Q12 vs. 3Q11 3Q12 vs. 3Q11 East Regulated East Regulated (0.9%) Integrated ($9) Integrated Utilities Utilities Ohio Companies (3.2%) Ohio Companies $0 West Regulated West Regulated 1.1% Integrated ($19) Integrate
Slide 18: YTD 2012 Retail Performance
YTD 2012 Retail Performance Retail Load* Weather Impact (weather normalized) (in millions) YTD12 vs. YTD11 YTD12 vs. YTD11 East Regulated East Regulated (0.9%) Integrated ($55) Integrated Utilities Utilities Ohio Companies (2.1%) Ohio Companies ($14) West Regulated West Regulated 1.1% Integrated ($3
Slide 19: Off System Sales Gross Margin Detail
Off System Sales Gross Margin Detail Third Quarter 2011 2012 Physical off-system sales margins ($millions) ($millions) decreased from last year by $56M OSS Physical Sales $ 134 $ 78 CRES Capacity Payments $ 12 $ 23 AEP/Dayton Hub pricing: 21% Marketing/Trading $ 23 $ 18 decrease in liquidation p
American Electric Power Company — Q3 2012 Earnings Presentation on 6ix