DTE SPINNING OFF DTE MIDSTREAM TO CREATE SIGNIFICANT SHAREHOLDER VALUE 3Q 2020 EARNINGS CONFERENCE CALL OCTOBER 27, 2020
Safe harbor statement The information contained herein is as of the date of this document. DTE Energy expressly disclaims any current intention to update any forward-looking statements contained in this document as a result of new…
Participants Jerry Norcia Robert Skaggs, Jr. President & CEO, DTE Energy Director, DTE Energy Dave Ruud David Slater SVP & CFO, DTE Energy President & COO, DTE Midstream 3
Creating significant investor value Strategic spin-off of DTE Midstream business from DTE Unlocking the full potential of our premier regulated utilities and premium natural gas midstream business Aligning business mix with investor…
Transaction overview: delivering greater shareholder value by creating a predominantly pure-play utility and a strategically positioned high-quality midstream business DTE Energy: transforming into a best-in-class predominantly…
Delivering greater shareholder value by creating a predominantly regulated utility and a uniquely positioned high-quality midstream business Positions DTE Energy as a high-growth, predominantly pure-play, best-in-class regulated…
Transaction overview Spin-off of Midstream designed to be tax-free Immediately after closing, DTE shareholders will: Structure Retain current DTE shares Receive pro-rata dividend of Midstream shares Expected close mid-year 2021…
Transaction overview: delivering greater shareholder value by creating a predominantly pure-play utility and a strategically positioned high-quality midstream business DTE Energy: transforming into a best-in-class predominantly…
Numerous benefits for DTE Energy as a predominantly pure-play regulated utility Enhanced strategic Premier, predominantly pure-play regulated electric and natural Operating earnings transformation focus gas utility 70% 90% Investments…
Two high-quality utilities operating in a constructive regulatory environment DTE Electric ROE Operating in Michigan, one of the nations most constructive regulatory jurisdictions 10-month rate cases supported by legislation…
DTE Electric: increasing generation and distribution investments by 2 billion in 5-year plan to provide customers cleaner, more reliable energy (billions) Electric investment Cleaner energy 14 Net zero carbon emissions target by…
DTE Gas: replacing aging infrastructure to reduce methane emissions while improving performance, cost and productivity (billions) Gas investment Main renewal Targeting net zero greenhouse gas emissions by 2050 3.5 Minimizing…
Electric and gas utilities targeting net zero emissions by 2050 DTE Electric delivering clean and reliable energy to customers DTE Electric carbon emissions reductions 80% carbon emissions reduction by 2040; net zero by 2050 Percent…
Transaction overview: delivering greater shareholder value by creating a predominantly pure-play utility and a strategically positioned high-quality midstream business DTE Energy: transforming into a best-in-class predominantly…
Midstream will be well-positioned with experienced leadership and unique, high-quality assets Enhanced Positioned to be a premier, publicly traded natural gas midstream company with high-quality assets strategic focus strategically…
Energy industry leader with the assets, resources and capabilities to stand on its own Key markets Pipelines 900 miles of FERC regulated gas transmission lines providing Ontario Northeast connectivity to high-quality markets Storage…
Highly focused, independent gas pipeline, storage and gathering company with proven track record (millions) Midstream operating earnings 18% CAGR 288 - 294 Consistently delivering strong financial results 18% CAGR for operating…
Diversified, long-term contracts and well-capitalized balance sheet bolster cash flow quality and growth potential Unique midstream investment opportunity Percentage of revenue from demand-based Only independent, mid-cap, gas-focused…
Transaction overview: delivering greater shareholder value by creating a predominantly pure-play utility and a strategically positioned high-quality midstream business DTE Energy: transforming into a best-in-class predominantly…
Strong YTD results provide confidence to increase 2020 operating earnings 1 guidance; positioned for a successful 2021 Continuing strong 2020 performance Positioned for success in 2021 3Q operating earnings of 2.61 per share Providing…
3Q 2020 operating earnings1 variance (millions, except EPS) 3Q 2019 3Q 2020 Variance Primary drivers Higher residential sales, rate implementation and DTE Electric 307 398 91 warmer weather offset by rate base growth costs…
2021 early outlook provides 7% operating EPS1 growth over 2020 original guidance (millions, except EPS) 2021 early outlook Primary drivers DTE Electric 826 - 840 Distribution and cleaner generation investments DTE Gas 202 - 212…
Strategic separation to create two premier energy companies positioned for further growth Positioning DTE Energy as a predominantly pure-play utility 90% operating earnings1 from and investment into utility operations Delivering clean,…
Transaction overview: delivering greater shareholder value by creating a predominantly pure-play utility and a strategically positioned high-quality midstream business DTE Energy: transforming into a best-in-class predominantly…
DTE Electric and DTE Gas regulatory update DTE Electric DTE Gas General rate case final order (U-20561) General rate case settlement approved August 2020 (U-20642) Effective: May 15, 2020 Effective: October 1, 2020 Rate recovery: 188…
Maintaining strong cash flow, balance sheet and credit profile (billions) 166 million equity issued through 3Q with internal mechanisms Planned equity issuances 2020 - 2022 Maintaining strong investment-grade credit rating and…
Updating 2020 cash flow and capital expenditures guidance Cash flow Capital expenditures (billions) (millions) Original Revised Original Revised guidance guidance guidance guidance DTE Electric Cash from operations1 3.0 3.5 Base…
Cash flow and capital expenditures actuals Cash flow Capital expenditures (billions) (millions) YTD 2019 YTD 2020 YTD 2019 YTD 2020 Cash from operations1 1.9 2.8 DTE Electric Base infrastructure 524 676 Capital expenditures (2.8)…
Weather impact on sales DTE Electric DTE Gas Cooling degree days Heating degree days % YTD YTD % % YTD YTD % 3Q 2019 3Q 2020 3Q 2019 3Q 2020 Change 2019 2020 Change Change 2019 2020 Change Actuals 702 697 (1%) 852 956 12% Actuals 57…
3Q and YTD Energy Trading reconciliation of operating earnings 1 to economic net income (millions) Energy Trading reconciliation 3Q 2019 3Q 2020 Operating earnings 18 15 Economic net income equals economic gross margin3 minus O&M…
Visibility into highly accretive Midstream growth projects Platforms Regulation Phase Growth opportunities Blue Union Early Gathering build-outs Gathering build-outs / compression / LEAP System Early market connections NEXUS…
Midstream leadership biographies David Slater Robert Skaggs, Jr. President & CEO Elect, Midstream Executive Chairman Elect, Midstream Slater has over 30 years of experience in the energy industry, where he has Skaggs has over 35…
2019 - 2020 reconciliation of reported to operating earnings (non-GAAP) and operating EPS (non-GAAP) Use of Operating Earnings Information DTE Energy management believes that operating earnings provide a more meaningful representation of…
2008 reconciliation of GSP reported Adjusted EBITDA is a non-GAAP to operating earnings (non-GAAP) measure (millions) (millions) Use of Operating Earnings Information DTE Energy management believes that operating Adjusted EBITDA is…
Reconciliation of reported to operating earnings (non-GAAP) Use of Operating Earnings Information Operating earnings exclude non-recurring items, certain mark-to-market adjustments and discontinued operations. DTE Energy management…
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