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Q2 2015 Conference Call – Calpine Corp.

Calpine Corp. · Jul 30, 2015 · 31 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Q2 2015 Conference Call – Calpine Corp. – slide 1
    Second Quarter 2015 Investor Update Conference Call July 30, 2015
  2. Q2 2015 Conference Call – Calpine Corp. – slide 2
    Agenda Welcome and Safe Harbor Bryan Kimzey Vice President, Investor Relations CEO Review Thad Hill President, Chief Executive Officer Operations Review Trey Griggs EVP, Chief Commercial Officer Financial Review Zamir Rauf…
  3. Q2 2015 Conference Call – Calpine Corp. – slide 3
    Delivering on All Fronts in 2015 ( millions) Strong Second Quarter Results; Recent Highlights Narrowing Full Year Guidance Narrowing 2015 guidance while maintaining midpoint Adjusted EBITDA1 1,950 - 2,050 1,949 Adjusted…
  4. Q2 2015 Conference Call – Calpine Corp. – slide 4
    Expanding Customer Channels Through Acquisition of Well-Established Retail Sales Platform Transaction Summary 240 million1 acquisition of nations largest independent retail electric provider Purchased at 4-5x initial Adjusted…
  5. Q2 2015 Conference Call – Calpine Corp. – slide 5
    Why You Should Invest in Calpine Today Attractive Entry Point, Given Favorable Future Drivers Compelling Value Proposition Disciplined capital allocation + Active portfolio management: Whats next Current share price1 implies: +100/kW…
  6. Q2 2015 Conference Call – Calpine Corp. – slide 6
    OPERATIONS REVIEW 7
  7. Q2 2015 Conference Call – Calpine Corp. – slide 7
    Focused on Best-in-Class Operations Employee Total Reportable Incident Rate Generation in Key Markets (000 MWh)1 Key YoY Low NW hydro + June heat Low nat gas prices SE 6-Pack Drivers: More contracted dispatch Deer Park / Channel Fore…
  8. Q2 2015 Conference Call – Calpine Corp. – slide 8
    Energy Margin1: Positioned to Respond to Favorable Secular Trends Energy Hedge Profile2 Sensitivities Capturing the Champion Acquisition: Natural Gas Price Sensitivity2 Disclosures do not yet incorporate acquisition; (assuming no…
  9. Q2 2015 Conference Call – Calpine Corp. – slide 9
    Market Overview: Texas & East Texas: Low Spark Spreads Challenging; East: Energy Markets Intact, Supply Rationalization Necessary Capacity Performance on Horizon Forward curves remain depressed Increased spark spreads despite milder…
  10. Q2 2015 Conference Call – Calpine Corp. – slide 10
    Market Overview: West Increasing Market Volatility Demonstrates Need for Flexible Driven by Reliance on Renewables Generation to Ensure Grid Stability Recent Example: Unexpected Load + Insufficient Renewables Pricing Volatility…
  11. Q2 2015 Conference Call – Calpine Corp. – slide 11
    FINANCIAL REVIEW 12
  12. Q2 2015 Conference Call – Calpine Corp. – slide 12
    Regional Adjusted EBITDA1: 2Q 2015 vs. 2014 ( millions, 000 MWh) East Region Adjusted EBITDA1 Drivers Adjusted EBITDA1 Generation2 74 457 413 (10) (20) Includes impact of 20% YoY Higher Commodity Margin1 increase in…
  13. Q2 2015 Conference Call – Calpine Corp. – slide 13
    Delivering on Financial Commitments ( millions) Maintaining Guidance Midpoint Balanced Capital Allocation Despite Challenging Pricing Environment 5 - 105 1,950 - 2,050 1,949 25 40 (64) (5) 2014 1 YTD Contracts Portfolio…
  14. Q2 2015 Conference Call – Calpine Corp. – slide 14
    Opportunistic Refinancing & De-Levering ( millions) Continuing to Opportunistically Access Recent transaction Capital Markets1 2,908 Refinanced 1.6 billion 2018 First Lien Term Loan 1,600 with equivalent due 2022 Reduced annual…
  15. Q2 2015 Conference Call – Calpine Corp. – slide 15
    APPENDIX 16
  16. Q2 2015 Conference Call – Calpine Corp. – slide 16
    Why You Should Invest in Calpine Today Slide 6 Footnote References 1 Based upon closing stock price on 7/29/15. 2015 yield based upon midpoint of guidance range. 2 A non-GAAP financial measure. Reconciliations of Adj. EBITDA and Adj.…
  17. Q2 2015 Conference Call – Calpine Corp. – slide 17
    Selected Operating Statistics 2Q15 2Q14 2Q15 2Q14 1 Total MWh Generated (in thousands) 27,540 23,733 Average Capacity Factor, excl. Peakers 53.4% 41.7% West 8,430 6,770 West 54.7% 44.0% Texas 11,618 9,912 Texas 55.8% 48.9% East…
  18. Q2 2015 Conference Call – Calpine Corp. – slide 18
    Regional Adjusted EBITDA1: YTD 2015 vs. 2014 ( millions, 000 MWh) East Region Adjusted EBITDA1 Drivers Adjusted EBITDA1 Generation2 859 14,707 14,711 11 795 (20) (50) (5) 2014 YTD 2015 YTD Lower Commodity Margin1…
  19. Q2 2015 Conference Call – Calpine Corp. – slide 19
    Although Calpines fleet can be difficult to model, simplifying techniques may help 1. Estimate annual generation (MWh) based on market outlook relative to disclosed 5. Adjust margin to capture items such as ancillary services and storage…
  20. Q2 2015 Conference Call – Calpine Corp. – slide 20
    Energy Margin1: Positioned to Respond to Favorable Secular Trends Slide 9 Footnote References 1 Energy Margin + Regulatory & Other Margin = Total Commodity Margin. 2 Estimated as of 07/17/15. Excludes immaterial proprietary positions as…
  21. Q2 2015 Conference Call – Calpine Corp. – slide 21
    Capital Structure Chart ( in millions) Corporate Debt Senior Secured Notes 1,928 First Lien Term Loans 2,787 Unsecured Notes1 3,450 Corporate Revolver Total Corporate Debt 8,165 CCFC Capital Lease Project Debt Obligations &…
  22. Q2 2015 Conference Call – Calpine Corp. – slide 22
    Calpine1 Continues to Benefit from Federal NOL Positions Federal NOLs at Dec. 31, 2014: 6.9 billion All are unrestricted 1 Includes CCFC. 23
  23. Q2 2015 Conference Call – Calpine Corp. – slide 23
    National Portfolio of Approximately 27,000 MW Geographic Diversity Dispatch Technology As of 07/01/2015 24
  24. Q2 2015 Conference Call – Calpine Corp. – slide 24
    Calpine Operating Power Plants As of July 1, 2015 With With Load CPN Peaking Technology Location COD Peaking Type Interest Capacity, Capacity Net West Region Agnews Power Plant Natural Gas Intermediate CA 1990 28 100% 28 Creed…
  25. Q2 2015 Conference Call – Calpine Corp. – slide 25
    Calpine Operating Power Plants (contd) As of July 1, 2015 With With Load CPN Peaking Technology Location COD Peaking Type Interest Capacity, Capacity Net East Region Auburndale Peaking Energy Center Natural Gas Peaking FL 2002…
  26. Q2 2015 Conference Call – Calpine Corp. – slide 26
    Reg G Reconciliation: Commodity Margin ( in millions) Commodity Margin includes our power and steam revenues, sales of purchased power and physical natural gas, capacity revenue, revenue from renewable energy credits, sales of surplus…
  27. Q2 2015 Conference Call – Calpine Corp. – slide 27
    Reg G Reconciliation: Commodity Margin (continued) ( in millions) Commodity Margin includes our power and steam revenues, sales of purchased power and physical natural gas, capacity revenue, revenue from renewable energy credits, sales…
  28. Q2 2015 Conference Call – Calpine Corp. – slide 28
    Reg G Reconciliation: Adjusted EBITDA and Adjusted Free Cash Flow ( in millions, except share and per share amounts) Adjusted EBITDA represents net income (loss) attributable to Calpine before net income (loss) attributable to the…
  29. Q2 2015 Conference Call – Calpine Corp. – slide 29
    Reg G Reconciliation: 2015 Adjusted EBITDA and Adjusted Free Cash Flow Guidance 30
  30. Q2 2015 Conference Call – Calpine Corp. – slide 30
    Major Maintenance and Capital Expenditure Guidance ( in millions) 2015E Major maintenance expense 250 A Maintenance capital expenditures 165 B Growth-related capital expenditures1 355 C Capital expenditures, gross2 520 Less:…
  31. Q2 2015 Conference Call – Calpine Corp. – slide 31

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