CenterPoint Energy Reports First Quarter Earnings Results and Reaffirms Full Year Guidance
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Reported Q1 2022 earnings of
$0.82 per diluted share -
Non-GAAP earnings per diluted share (“non-GAAP EPS”) was
$0.47 for Q1 2022 -
Non-GAAP EPS range for 2022 reaffirmed at
$1.36 -$1.38 . Reiterating industry-leading 8% non-GAAP EPS annual growth rate target for 2022 through 2024 and mid-to-high end of the 6-8% range thereafter through 2030 - Made full exit from midstream; sold entire Energy Transfer(“ET”) position within four months of the merger between Enable and ET
On a non-GAAP basis, EPS for the first quarter was
“This quarter extended our track record of delivering on expectations again. We are on track to meet our
“We are in year two of our capital plan which is now increased to
Lesar added. “Looking ahead, we remain focused on our value proposition which is sustainable earnings growth for our shareholders; sustainable, resilient, and affordable services for our customers; and a sustainable positive impact on the environment for our communities.”
Earnings Outlook
Given the merger between Enable and Energy Transfer and CenterPoint Energy’s divestiture of its remaining midstream investments during 2022,
In addition to presenting its financial results in accordance with GAAP, including presentation of income (loss) available to common shareholders and diluted earnings (loss) per share,
Management evaluates CenterPoint Energy’s financial performance in part based on non-GAAP income and non-GAAP earnings per share. Management believes that presenting these non-GAAP financial measures enhances an investor’s understanding of CenterPoint Energy’s overall financial performance by providing them with an additional meaningful and relevant comparison of current and anticipated future results across periods. The adjustments made in these non-GAAP financial measures exclude items that Management believes do not most accurately reflect the company’s fundamental business performance. These excluded items are reflected in the reconciliation tables of this news release, where applicable. CenterPoint Energy’s non-GAAP income and non-GAAP diluted earnings per share measures should be considered as a supplement to, and not as a substitute for, or superior to, income available to common shareholders and diluted earnings per share, which respectively are the most directly comparable GAAP financial measures. These non-GAAP financial measures also may be different than non-GAAP financial measures used by other companies.
2021 non-GAAP Utility EPS guidance range
“Utility EPS” included net income from the company’s Electric and Natural Gas segments, as well as after-tax Corporate and Other operating income and an allocation of corporate overhead based upon Electric’s and Natural Gas’s relative earnings contribution. Corporate overhead consisted primarily of interest expense, preferred stock dividend requirements, and other items directly attributable to the parent along with the associated income taxes.
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2021 Utility EPS excluded:
- Earnings or losses from the change in value of the CenterPoint Energy’s 2.0% Zero-Premium Exchangeable Subordinated Notes due 2029 (“ZENS”) and related securities
- Earnings and losses associated with the ownership and disposal of midstream common and preferred units (including amounts reported in discontinued operations), net gain associated with the consummation of the merger between Enable and Energy Transfer, a corresponding amount of debt related to midstream common and preferred units, and an allocation of associated corporate overhead
- Cost associated with the early extinguishment of debt
-
Impacts associated with
Arkansas andOklahoma gas LDC sales - Certain impacts associated with other mergers and divestitures
2022 non-GAAP EPS guidance range
Beginning in 2022,
-
2022 non-GAAP EPS guidance excludes:
- Earnings or losses from the change in value of ZENS and related securities
-
Gain and impact, including related expenses, associated with
Arkansas andOklahoma gas LDC sales - Income and expense related to ownership and disposal of Energy Transfer common and Series G preferred units, and a corresponding amount of debt related to the units
In providing this guidance,
Reconciliation of Consolidated income (loss) available to common shareholders and diluted earnings (loss) per share (GAAP) to non-GAAP income and non-GAAP diluted earnings per share
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Quarter Ended
|
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Dollars in
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Diluted EPS (1) |
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Consolidated income (loss) available to common shareholders and diluted EPS |
$ |
518 |
|
$ |
0.82 |
|
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|
|
|
|
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ZENS-related mark-to-market (gains) losses: |
|
|
|
|
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Equity securities (net of taxes of |
|
81 |
|
|
0.13 |
|
||
Indexed debt securities (net of taxes of |
|
(83 |
) |
|
(0.13 |
) |
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|
|
|
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Midstream-related earnings (net of taxes of |
|
(32 |
) |
|
(0.05 |
) |
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|
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Impacts associated with gas LDC sales (net of taxes of |
|
(189 |
) |
|
(0.30 |
) |
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|
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|
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Consolidated on a non-GAAP basis |
$ |
295 |
|
$ |
0.47 |
|
1) |
Quarterly diluted EPS on both a GAAP and non-GAAP basis are based on the weighted average number of shares of common stock outstanding during the quarter, and the sum of the quarters may not equal year-to-date diluted EPS |
2) |
Taxes are computed based on the impact removing such item would have on tax expense. Taxes related to the gas LDC sales and the midstream-related earnings are booked proportionately by applying the projected annual effective tax rate percentage to income earned each quarter in accordance with GAAP. Additional tax expense related primarily to the write-off of non-deductible goodwill will be reflected in tax expense over the remainder of 2022 and excluded from non-GAAP EPS |
3) |
Comprised of common stock of AT&T Inc. and Charter Communications, Inc. (as of |
4) |
Includes earnings and expenses related to ownership and disposal of Energy Transfer units, a corresponding amount of debt related to the units and an allocation of associated corporate overhead. Includes costs associated with early extinguishment of |
Reconciliation of Consolidated income (loss) available to common shareholders and diluted earnings (loss) per share (GAAP) to non-GAAP income and non-GAAP diluted earnings per share
Quarter ended
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Utility Operations |
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Midstream
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Corporate
|
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Consolidated |
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Dollars in
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Diluted
|
|
Dollars in
|
Diluted
|
|
Dollars in
|
Diluted
|
|
Dollars in
|
Diluted
|
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Consolidated income (loss) available to common shareholders |
$ |
304 |
|
|
|
$ |
71 |
|
|
|
$ |
(41 |
) |
|
|
$ |
334 |
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Add back: Series B preferred stock dividend(2) |
— |
|
|
|
— |
|
|
|
17 |
|
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|
17 |
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Consolidated income (loss) available to common shareholders – diluted and diluted EPS(1) |
$ |
304 |
|
$ |
0.48 |
|
|
$ |
71 |
|
$ |
0.12 |
|
|
$ |
(24 |
) |
$ |
(0.04 |
) |
|
$ |
351 |
|
$ |
0.56 |
|
|
|
|
|
|
|
|
|
|
|
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ZENS-related mark-to-market (gains) losses: |
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Marketable securities (net of taxes of |
— |
|
— |
|
|
— |
|
— |
|
|
19 |
|
0.03 |
|
|
19 |
|
0.03 |
|
||||||||
Indexed debt securities (net of taxes of |
— |
|
— |
|
|
— |
|
— |
|
|
(21 |
) |
(0.03 |
) |
|
(21 |
) |
(0.03 |
) |
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|
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|
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Impacts associated with the Vectren merger (net of taxes of |
2 |
|
— |
|
|
— |
|
— |
|
|
— |
|
— |
|
|
2 |
|
— |
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|
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Cost associated with the early extinguishment of debt (net of taxes of |
— |
|
— |
|
|
— |
|
— |
|
|
21 |
|
0.03 |
|
|
21 |
|
0.03 |
|
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Corporate and Other Allocation |
(7 |
) |
(0.01 |
) |
|
2 |
|
— |
|
|
5 |
|
0.01 |
|
|
— |
|
— |
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Consolidated on a non-GAAP basis |
$ |
299 |
|
$ |
0.47 |
|
|
$ |
73 |
|
$ |
0.12 |
|
|
$ |
— |
|
$ |
— |
|
|
$ |
372 |
|
$ |
0.59 |
|
1) |
Quarterly diluted EPS on both a GAAP and non-GAAP basis are based on the weighted average number of shares of common stock outstanding during the quarter, and the sum of the quarters may not equal year-to-date diluted EPS. EPS figures for Utility Operations, Discontinued Operations and Corporate and Other are non-GAAP financial measures. |
2) |
To reflect income and earnings per diluted share as if the Series B preferred stock were converted to common stock |
3) |
Taxes are computed based on the impact removing such item would have on tax expense |
4) |
Comprised of common stock of AT&T Inc. and Charter Communications, Inc. |
5) |
Corporate and Other, plus income allocated to preferred shareholders |
Filing of Form 10-Q for
Today,
Webcast of Earnings Conference Call
CenterPoint Energy’s management will host an earnings conference call on
About
As the only investor owned electric and gas utility based in
Forward-looking Statements
This news release includes, and the earnings conference call will include, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this news release, the words "anticipate," "believe," "continue," "could," "estimate," "expect," "forecast," "goal," "intend," "may," "objective," "plan," "potential," "predict," "projection," "should," "target," "will" or other similar words are intended to identify forward-looking statements. These forward-looking statements are based upon assumptions of management which are believed to be reasonable at the time made and are subject to significant risks and uncertainties. Actual events and results may differ materially from those expressed or implied by these forward-looking statements. Examples of forward-looking statements in this news release or on the earnings conference call include statements regarding capital investments (including with respect to renewables projects, mobile generation spend and the City of Houston’s Master Energy Plan and Resilient Now), the impacts of the
Important factors that could cause actual results to differ materially from those indicated by the provided forward-looking information include, but are not limited to, risks and uncertainties relating to: (1) CenterPoint Energy’s potential business strategies and strategic initiatives, restructurings, joint ventures and acquisitions or dispositions of assets or businesses, including the completed sale of our Natural Gas businesses in
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