Earnings Teleconference 1 st Quarter April 25, 2018

Transcription

1 Earnings Teleconference st Quarter 208 April 25, 208

2 Table of Contents Section Slides Caution Regarding Forward-Looking Statements and Regulation G Compliance 2 Strategic Execution 3 Quarterly Results Guidance and Longer-Term Financial Outlooks 8-9 Credit Profile 0 Appendix and Regulation G Reconciliations Utility Overview 2 Utility Companies Regulatory Overviews 3-23 Generation Projects 24 EWC Overview 25 EWC EPS Variance Details 26 EWC Nuclear Plant Updates NRC Financial Assurance Filings 29 EWC Hedging and Price Disclosures EWC Operational Adjusted EBITDA Outlook and Estimated Special Items Progress Against 208 Guidance and Sensitivities Integrated Report 37 First Quarter Earnings Summary 38 Regulation G Reconciliations 39-44

3 Caution Regarding Forward-Looking Statements and Regulation G Compliance In this presentation, and from time to time, Entergy Corporation makes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 995. Such forward-looking statements include, among other things, Entergy s 208 earnings guidance, its current financial and operational outlook, and other statements of Entergy s plans, beliefs or expectations included in this presentation. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this presentation. Except to the extent required by the federal securities laws, Entergy undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied in such forward-looking statements, including (a) those factors discussed elsewhere in this presentation and in Entergy s most recent Annual Report on Form 0-K, any subsequent Quarterly Reports on Form 0-Q and Entergy s other reports and filings made under the Securities Exchange Act of 934; (b) uncertainties associated with () rate proceedings, formula rate plans and other cost recovery mechanisms, including the risk that costs may not be recoverable to the extent anticipated by the utilities and (2) implementation of the ratemaking effects of changes in law; (c) uncertainties associated with efforts to remediate the effects of major storms and recover related restoration costs; (d) nuclear plant relicensing, operating and regulatory costs and risks, including any changes resulting from the nuclear crisis in Japan following its catastrophic earthquake and tsunami; (e) changes in decommissioning trust fund values or earnings or in the timing or cost of decommissioning Entergy s nuclear plant sites; (f) legislative and regulatory actions and risks and uncertainties associated with claims or litigation by or against Entergy and its subsidiaries; (g) risks and uncertainties associated with strategic transactions that Entergy or its subsidiaries may undertake, including the risk that any such transaction may not be completed as and when expected and the risk that the anticipated benefits of the transaction may not be realized; (h) effects of changes in federal, state or local laws and regulations and other governmental actions or policies, including changes in monetary, fiscal, tax, environmental or energy policies; and (i) the effects of technological changes and changes in commodity markets, capital markets or economic conditions, during the periods covered by the forward-looking statements. This presentation includes the non-gaap financial measures of operational EPS; UP&O adjusted EPS; normalized ROE; parent debt to total debt, excluding securitization debt; operational FFO to debt, excluding securitization debt; and debt to operational adjusted EBITDA, excluding securitization debt when describing Entergy s results of operations and financial performance. We have prepared reconciliations of these financial measures to the most directly comparable GAAP measure, which can be found in the appendix of this presentation. This presentation should be considered together with the Entergy earnings release to which this teleconference relates, which is posted on the company s website at and which contains further information on non-gaap financial measures. 2

4 Strategic Execution 208 Key Deliverables Q 2Q 3Q 4Q E-MS annual FRP filing NOPS CCNO decision E-NO AMI decision E-NO renewable RFP selections E-LA renewable RFP selections E-LA FRP extension and modification approval E-LA annual FRP filing E-MS FRP decision E-TX rate case filing Lake Charles transmission project completion ANO Column 4 exit VY certificate of public good decision from VPUC (now expected 3Q) Analyst Day (in NYC) E-AR annual FRP filing E-NO rate case filing E-LA annual FRP implementation WPEC LPSC decision E-AR renewable PPA approval Southwest Mississippi transmission project completion VY license transfer application decision from NRC IPEC license renewal NRC approval (now expected 4Q) E-AR FRP decision E-TX rate case decision VY sale to NorthStar MTEP 8 approval Annual dividend review Estimated timing as of February 208; regulatory activity or other factors could lead to changes 3

5 First Quarter Summary Q8 EPS Summary; $ Current Quarter Q8 Q7 Change ETR Consolidated As-reported Operational Utility, Parent & Other As-reported Operational Adjusted (0.2) EWC As-reported (0.0) (0.6) 0.06 Operational (0.04) Key takeaways: UP&O adjusted and ETR operational on track to meet full year guidance Q8 operational results include a $(0.04) loss for EWC NDTs, as compared to the ~$0.25 planning assumption for the quarter Q8 operational results also include $0.09 of positive weather See slide 38 for a summary of first quarter 208 and first quarter 207 earnings Excludes special items and normalizes weather and income taxes 4

6 UP&O First Quarter EPS Comparison UP&O Adjusted Earnings; pre-tax $M, except for income taxes (primary drivers noted in italics) 49 (4) Regulatory provisions for lower tax rate (35) Nuclear (5) Franchise, ad valorem and payroll taxes 50 Lower federal tax rate (6) Q7 Net revenue (excl. weather) Utility non-fuel O&M Taxes other than income taxes Income taxes Other Q8 UP&O Adjusted EPS; $ Q7 Q8 Change UP&O As-Reported Less: Special items Weather (0.6) Normalize tax (0.05) UP&O Adjusted (0.2) 8.4M and 79.8M average fully diluted shares outstanding for Q8 and Q7 respectively 5

7 EWC First Quarter EPS Comparison EWC Operational Earnings ; pre-tax $M, except for FitzPatrick and income taxes (primary drivers noted in italics) 7 (39) 26 () 67 NDT mark-tomarket 2 Lower federal tax rate Change in pre-tax income Q7 FitzPatrick Other income Income taxes Other Q8 60 EWC Operational EPS; $ Q7 Q8 Change EWC As-Reported (0.6) (0.0) 0.06 Less: Special items (0.53) (0.43) 0.0 EWC Operational (0.04) 8.4M and 79.8M average fully diluted shares outstanding for Q8 and Q7 respectively Individual line items exclude the variances from the sale of FitzPatrick, which is summarized as one driver (see slide 26) 2 In 207, only realized gains, along with interest and dividends, were recorded to the income statement 6

8 First Quarter OCF Comparison Consolidated OCF; $M OCF Contribution by Business ; $M Business Segment Q8 Q7 Change Utility (35) Parent & Other (57) (76) 9 Q8 Q7 EWC 9 47 (56) Total Calculations may differ due to rounding Primary Drivers Lower refueling outage spending Favorable weather Partially offset by Lower net revenue at EWC Intercompany income tax payments contributed to the line of business variances 7

9 208 EPS Guidance Affirmed 208 EPS Guidance; $ midpoint midpoint Entergy Consolidated Operational Utility, Parent & Other Adjusted Excludes special items and normalizes weather and income taxes 8

10 Utility, Parent & Other Financial Outlook UP&O Adjusted EPS ; $ E Guidance 9E Outlook 20E Outlook Excludes special items and normalizes weather and income taxes 9

11 Credit Profile Financial Performance Measures Credit Metrics, excluding securitization debt, as of Q8 Metric Q8 Parent Debt to Total Debt; % 2.2 Debt to EBITDA; Times 5.0 FFO to Debt; % 5.4 Credit Ratings (outlook) S&P Moody s E-AR E-LA E-MS E-NO E-TX SERI ETR A (positive) A2 (stable) A (positive) A2 (stable) A (positive) A2 (stable) A (positive) Baa2 (stable) A (positive) Baa (stable) A (positive) Baa (stable) BBB+ (positive) Baa2 (negative) Senior secured ratings for the OpCos and SERI; corporate credit rating for Entergy 0

12 Appendix and Regulation G Reconciliations

13 Utility Overview 207 Electric Retail Sales ; % Governmental 2 Residential Industrial Commercial 207 Generation Portfolio 2 ; % E-AR Electric utility 709,000 customers Authorized ROE range: 9.25% 0.25% Forward test year FRP E-LA Electric and gas utility Number of customers Electric,078,000 Gas 93,000 Authorized ROE ranges: Electric 9.95% (207 test year); 9.2% 0.4% (208-9 test years) Gas 9.45% 0.45% Electric FRP, Gas RSP Coal E-MS E-NO E-TX 0 CT/CCGT/ Hydro/Solar Nuclear Legacy Gas/ Oil Electric utility 449,000 customers Authorized ROE range: 9.47%.49% FRP with forward-looking features Electric and gas utility Number of customers Electric 200,000 Gas 06,000 Authorized ROE ranges: Electric 0.7%.5% Gas 0.25%.25% Electric utility 448,000 customers Authorized ROE: 9.8% Rate case Rate case Percent of 207 weather-adjusted GWh electric retail sales 2 Percent of owned and leased MW capability for generation portfolio as of 2/3/7 2

14 E-AR Entergy Arkansas LTM 3/3/8 ROE; % Preliminary subject to change pending 3/3/8 SEC Form 0-Q filing E-AR Electric Utility Metric Detail Customers 709,000 Authorized ROE 9.25% 0.25% Rate Base $7.095B retail rate base (208 test year) WACC (after-tax) 4.67% Equity Ratio 3.69%, including $2.2B of ADIT 2 (45.48% traditional equity ratio) Regulatory Construct Forward test year FRP (for annual test years); result outside authorized ROE range resets to midpoint; maximum rate change 4% of filing year total retail revenue; true-up of projection to actuals netted with future projection Last Rate Change $7M increase effective /2/ Book Normalized Riders MISO, capacity costs, Grand Gulf, tax adjustment, energy efficiency, fuel and purchased power Normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments 2 The $2.2B of ADIT reflects the pre-tax reform tax rate; will continue to reflect that amount in its cost of capital calculation by including the regulatory liability for the excess ADIT until the value of the excess ADIT has been refunded to customers 3

15 E-LA 6.3 Entergy Louisiana LTM 3/3/8 ROE; % Preliminary subject to change pending 3/3/8 SEC Form 0-Q filing 0.0 Book Normalized 2 E-LA Electric and Gas Utility Metric Detail Electric Detail Gas Customers,078,000 93,000 Authorized 9.5% 0.75% 9.45% 0.45% ROE Last Filed Rate Base $8.303B, filed on 5/3/7 (2/3/6 test year) WACC 7.35% 7.54% (after-tax) Equity Ratio 49.64% 5.63% Regulatory Construct Proposed Rate Change Riders/Specific Recovery FRP, test years; 60/40 customer/company sharing outside bandwidth No FRP change requested Capacity, MISO, fuel $0.059B, filed on /3/7 (9/30/6 test year) RSP (50 bps dead band, 5 bps 200 bps 50% sharing, >200 bps adjust to 200 bps plus 75 bps sharing) $.8M RSP increase Gas infrastructure Table reflects prior FRP framework; on 4/8/8, LPSC approved extension of FRP with certain modifications (see slide 5) Pending finalization of the 206 test year filing (docket U-34475) 2 Normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments 4

16 E-LA Additional regulatory highlights Application to Extend and Modify FRP (Docket U-3463) Settlement Highlights Three-year extension 9.95% ROE for 207 test year filing St. Charles Power Station placed in rates at 9.95% when in-service 9.2% 0.4% ROE (9.8% midpoint) for 208 and 209 test year filings with 60/40 sharing outside of band New mechanism to recover incremental transmission plant in-service above baseline transmission investment (estimated at $00M annually), using plant in-service through Aug 3 (8 months beyond test year) Customers to receive benefits of tax reform retroactive to //8 Cap on revenue increase of $35M for 208 test year, and $70M for the cumulative 208 and 209 test years Status: Approved by the LPSC 5

17 E-LA - Washington Parish Energy Center Regulatory approval process Project Overview (Docket U-34472) Item Details MW ~36 Estimated total $26M investment Plant type/fuel CT/natural gas Location Bogalusa, LA In-service date 202 (pending timely approval) Recovery mechanism FRP adjustment outside sharing for the first year if E-LA s FRP is in effect when the project is placed in service, otherwise through base rate case filing Status Parties have reached an agreement in principle; seeking to suspend procedural schedule Next Steps Date TBD Summer 208 Event Settlement filing Targeted LPSC decision Includes transmission interconnection and other related costs 6

18 E-MS Entergy Mississippi LTM 3/3/8 ROE; % Preliminary subject to change pending 3/3/8 SEC Form 0-Q filing Book Normalized E-MS Electric Utility Metric Detail Customers 449,000 Authorized ROE 0.48% performance-adjusted midpoint (9.95% % performance factor); 9.47%.49% range (annual redetermination based on formula) Rate Base $2.3B (207 forward test year) WACC 7.35% (after-tax) Equity Ratio 49.37% Regulatory Construct Last Rate Change Riders FRP with forward-looking features; annual redetermination subject to performance-based bandwidth calculation and subject to annual look-back evaluation; maximum rate increase 4% of test year retail revenue (higher rate increase requires filing of a general rate case) No change requested Power Management Rider, Grand Gulf, fuel, MISO, Unit Power Cost, storm damage, energy efficiency, ad valorem tax adjustment Normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments 7

19 E-MS Additional regulatory highlights 208 FRP - Future Test Year (Docket 204-UN-32) Highlights Authorized ROE: 0.32% performance adjusted midpoint (9.69% % performance factor); 9.28%.36% range (annual redetermination based on formula) Rate base: $2.43B WACC (after tax): 7.3% Equity ratio: 48.05% based on year end 207 Earned ROE: 9.47% Rate change requested: None Tax reform implementation incorporated as a known and measurable change Next Steps Date Event April May 208 Discovery phase 5/3/8 Dispute resolution deadline June 208 Final order expected 8

20 E-NO Entergy New Orleans LTM 3/3/8 ROE; % Preliminary subject to change pending 3/3/8 SEC Form 0-Q filing E-NO Electric and Gas Utility Metric Detail Electric Detail Gas Customers 200,000 06,000 Authorized ROE 0.7%.5% 0.25%.25% Rate Base (filed on 5/3/2) $0.299B (2/3/ test year) does not include $0.228B for Union (first year average rate base) WACC (after-tax) 8.58% 8.40% $0.089B (2/3/ test year) Equity Ratio 50.08% 50.08% Regulatory Construct Rate case Rate case Riders/Specific Fuel, capacity (e.g., Purchased gas Recovery Ninemile 6, Union) 0.4. Book Normalized 2 Last filed electric rate base does not include Algiers assets transferred to E-NO from E-LA on 9//5; net book value of the assets at the time of the transfer was ~$85M 2 Normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments 9

21 E-TX Entergy Texas LTM 3/3/8 ROE; % Preliminary subject to change pending 3/3/8 SEC Form 0-Q filing E-TX Electric Utility Metric Detail Customers 448,000 Authorized ROE 9.8% Rate Base $.634B (3/3/3 adjusted test year), filed on 9/25/3 does not include ~$0.33B for rate base being recovered through DCRF and TCRF WACC (after-tax) 8.22% Equity Ratio 48.6% Regulatory Rate case Construct Last Rate Changes TCRF increase: ~$9M effective 3/20/7 DCRF increase: ~$9.6M effective 9//7 Riders Fuel, capacity, DCRF, TCRF, RPCE payments, rate case expenses, AMI surcharge, among others Book Normalized Normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments 20

22 SERI Grand Gulf Nuclear Station SERI Generation Company Metric Detail Principal Asset An ownership and leasehold interest in Grand Gulf Authorized ROE 0.94% Last Calculated Rate Base $.248B (3/3/8) WACC (after-tax) 8.8% Equity Ratio 65% Regulatory Construct Monthly cost of service Energy and Capacity Allocation 2 ; % E-NO 7 E-MS 33 E-AR 36 E-LA 4 Sale leaseback obligation excluded from capital structure, treated as an operating lease and recovered as an O&M cost 2 Reflects percentages under SERI s Unit Power Sales Agreement 2

23 SERI Additional regulatory highlights ROE Complaint (FERC Docket EL7-4) and SERI Depreciation and Decommissioning (FERC Dockets EL7-93 and ER7-229) Consolidated Proceeding Highlights On /23/7, the APSC and MPSC filed a complaint which alleged that the 0.94% ROE in SERI s Unit Power Sales Agreement is unjust and unreasonable MPSC and APSC provided analysis supporting an ROE range of 8.37% to 8.67% LPSC and CCNO intervened in support of the complaint On 9/29/7, FERC set the complaint for hearing and settlement discussions before an ALJ, with a refund effective date of /23/7; FERC also consolidated the complaint with two other SERI rate proceedings related to depreciation rates and decommissioning costs Settlement proceedings ongoing Next Steps Date Event 5//8 Settlement conference 22

24 Retail Filings on Tax Reform Retail Filings Summary OpCo Docket Lower Federal Tax Rate in Rates Return of Unprotected Excess ADIT E-AR FR/ U To be addressed in 208 FRP filing $466M returned to customers ($360M in 208, remainder in 209) E-LA U-3436 In base rates effective 9//8; Reg. liability for Jan Aug 208 benefit $22M returned to customers (~half in 208, remainder ) E-MS 204-UN-32 Reflected in 208 FRP filing $65M (~half returned to customers in 208, ~half to recover existing rate base E-NO In base rates effective in Aug 209; Reg. liability for Jan 208 Aug 209 benefit Key Milestones items) $37M ($22M returned to customers in certain high-bill months, $2M grid mod funding, $3M Smart City pilot) E-TX TBD E-TX plans to address in its base rate case filing (targeted for 2Q8) Event E-AR (6-036-FR) E-AR (8-006-U) E-LA E-MS E-NO E-TX Initial Filing 3Q8 2/27/8 4/2/8 3/5/8 3/26/8 2Q8 Decision/Guidance 4Q8 Approved Approved 3/27/8 4/8/8 June 208 TBD 4Q8 Represents the grossed up amount 2 Council Resolution No. 8-38; no assigned docket number 23

25 Generation Projects Project Location OpCo MW St. Charles Power Station Montz, LA E-LA ~980 CCGT Estimated Cost Estimated In-Service Status $869M 209 Under construction New Orleans Power Station New Orleans, LA E-NO ~28 RICE 2 $20M 2020 Issued full notice to proceed Lake Charles Power Station Westlake, LA E-LA ~994 CCGT $872M 2020 Under construction Montgomery County Power Station Willis, TX E-TX ~993 CCGT $937M 202 Issued limited notice to proceed Washington Parish Energy Center Bogalusa, LA E-LA ~36 CT $26M 202 Under regulatory review; see slide 6 Note: Projects are subject to required approvals Includes transmission interconnection and other related costs 2 Reciprocating internal combustion engine 24

26 EWC Overview Region Breakdown; % MW as of 2/3/7 MISO 30 NEPOOL 8 NYISO 52 Generation Portfolio; % MW as of 2/3/7 Gas and Other Oil 5 5 Nuclear 90 EWC Nuclear Plants Indian Point Indian Point 2 Indian Point 3 Palisades Pilgrim VY License expiration n/a 9/28/3 2/2/5 3/24/3 6/8/32 n/a Net MW owned n/a,028, n/a Energy market n/a NYISO NYISO MISO NEPOOL n/a (closest hubs) (Zone G) (Zone G) (Indiana) (Mass Hub) Net book value of $24M $55M $55M $5M plant and related assets as of 3/3/8 NDT balance as of $485M $64M $789M $453M $,048M $59M 3/3/8 ARO liability balance $220M $723M $708M $58M 3 $664M $368M as of 3/3/8 2 Planned closing date Shut down 4/30/20 4/30/2 5/3/22 5/3/9 Shut down EWC Non-Nuclear Plants ISES 2 Nelson 6 RS Cogen COD Fuel type/technology Coal Coal CCGT Cogen Net MW owned Market MISO MISO MISO Initial expiration dates; Indian Point 2 and 3 are operating under timely renewal doctrine 2 ARO liability balances are based on most recent estimates and are subject to change 3 Includes $39M for Big Rock Point 25

27 EWC Q8 Variance Details EWC Q8 EPS Variance Details; pre-tax $M Line Item Quarter-over-Quarter Variances EWC excl. EWC FitzPatrick FitzPatrick Net revenue (22) (4) (8) Non-fuel O&M 3 3 (0) Decommissioning expense Taxes other than income taxes 3 2 Depreciation/amortization expense 5-5 Other income (deductions) other (43) (4) (39) Interest expense and other charges (2) - (2) Income taxes 22 (4) 26 Quarter-over-Quarter Operational Variance (7) 7 (4) Add back special items 6 (48) 64 Quarter-over-Quarter As-Reported Variance 9 (4) 50 Calculations may differ due to rounding 26

28 IPEC License Renewal Status NRC License Renewal Application (NRC Dockets (IP2) and (IP3)) Highlights On 2/8/7, Entergy filed with NRC: Notice of intent to shut down in 2020/2 and Amendment to license application to shorten license life to 2024/25 Next Steps Date 4Q8 Event NRC decision expected 27

29 Vermont Yankee Transaction Overview Transaction Highlights Item Details Structure Equity sale of ENVY Purchaser NorthStar Decommissioning Holdings, LLC Expected Close December 208 Conditions to Regulatory approvals (VPUC certificate of public good; NRC license transfer application) Close Include Minimum NDT balance Status VPUC: On 3/2/8 the Vermont agencies and several parties entered into a memorandum of understanding, which addresses financial assurances and site restoration standards NRC: Issued second set of requests for additional information on 4/5/8 Next Steps VPUC NRC Docket (ADAMS ML7045A40) Evidentiary hearing 5/0 5/6/8 N/A Decision Expected 3Q8 Expected 3Q8 Assumes that the NRC does not issue additional requests for information 28

30 NRC Financial Assurance Filings Financial Assurance Filings Summary; amounts in $M Filing 208 Filing / 207 Data Unit Assumed Shutdown NRC Minimum 2/3/7 (Escalated) Excess IP Shutdown 569.2, IP IP VY Shutdown 874.6, Pilgrim , Palisades NRC calculations are based on the NRC license life A plant can use NRC formula amount (NRC minimum) or a site-specific study if it is higher than the NRC minimum A site-specific study allows the benefit of assuming a safe storage period assuming a net 2% growth until the year the dollars are projected to be incurred (despite the higher costs in the site-specific study, the extended fund growth period can mean that the amount needed for financial assurance is lower) Based on site-specific study; assumes SAFSTOR 29

31 EWC Nuclear Capacity and Generation Table ( of 2) EWC Nuclear Portfolio (based on market prices as of March 3, 208) Balance of 8E 9E 20E 2E 22E Energy Planned TWh of generation Percent of planned generation under contract Unit-contingent 98% 9% 60% 78% 67% Firm LD 9% Offsetting positions (9)% Total 98% 9% 60% 78% 67% Average revenue per MWh on contracted volumes (in $) Expected based on current market prices See Appendix F in the release for definitions Reflects shutdown of Pilgrim (5/3/9), IP2 (4/30/20), IP3 (4/30/2) and Palisades (5/3/22) 30

32 EWC Nuclear Capacity and Generation Table (2 of 2) EWC Nuclear Portfolio (based on market prices as of March 3, 208) Balance of 8E 9E 20E 2E 22E Capacity Planned net MW in operation (average) 3,568 3,67 2,95, Percent of capacity sold forward Bundled capacity and energy contracts 22% 25% 36% 69% 99% Capacity contracts 46% 3% Total 68% 38% 36% 69% 99% Average revenue under contract (applies to capacity contracts only) (in $/kw-month) Total Energy and Capacity Revenues 2 (in $) Expected sold and market total revenue per MWh Sensitivity: -/+ $0 per MWh market price change See Appendix F in the release for definitions Reflects shutdown of Pilgrim (5/3/9), IP2 (4/30/20), IP3 (4/30/2) and Palisades (5/3/22) 2 Includes assumptions on converting a portion of the portfolio to contracted with fixed price cost or discount and excludes non-cash revenue from the amortization of the Palisades below-market PPA, mark-to-market activity and service revenues 3

33 Energy Prices EWC Northeast Nuclear Energy Prices ; $/MWh (weighted by open position) 2/3/7 03/3/ Bal 8E 9E 20E 2E Excludes Palisades, which is 99% hedged, and reflects shutdown of Pilgrim (5/3/9), IP2 (4/30/20) and IP3 (4/30/2) 32

34 EWC Operational Adjusted EBITDA Outlook Reflects 3/3/8 market prices EWC Operational Adjusted EBITDA; $M E 9E 20E 2E 22E Net Revenue,320, Non-Fuel O&M (745) (670) (55) (350) (40) Other (25) (00) (70) (40) (20) Total /3/ (5) 33

35 Estimated Special Items Estimated Special Items; pre-tax $M 8E 9E 20E 2E 22E Asset impairments (capital) (25) (60) (20) (5) - Asset impairments (fuel, refuel/defuel, other) (35) (95) (0) (0) (0) Severance and retention (65) (00) (60) (30) (5) Net gain or loss on sale of assets (65) Total (590) (255) (90) (55) (25) Estimated special items, EPS (2.55) Note: Estimates for expected special items resulting from decisions to close or sell EWC nuclear plants. Other special items may occur during the periods presented, the impact of which cannot reasonably be estimated at this time. 34

36 Progress Against Guidance Measure 208 Guidance YTD Result Comments ETR Operational EPS $6.25 $6.85 $.6 Affirmed UP&O Adjusted EPS $4.50 $4.90 $0.7 Affirmed Full year considerations Driver Comments Utility Weather $0.09 YTD; assume normal weather in forecast periods Weather-adj. retail 3.0% YTD; expect quarterly timing variances sales growth Full year expectation generally consistent with guidance of (0.7%) Rate actions/ Includes rate base actions as well as rate changes and/or reg. provisions related to tax reform regulatory provisions Remaining base rate filings: E-LA (filing 2Q/rate change, if any, 3Q); E-TX (filing 2Q/rate change, if any, 4Q) Operating expenses Includes non-fuel O&M, depreciation and taxes other than income taxes; expect quarterly timing differences Income tax Will include lower federal tax rate and include amortization of unprotected portion of excess ADIT (offset in net revenue) EWC Net revenue Volume in Q8 lower-than-planned See Generation and Capacity table on slides 30 3 for balance of year expectation Other income Q8 trust performance below guidance assumption ($(0.04) versus planning assumption of approximately $0.25 for the quarter) Outlook assumes historical annualized return of ~6.25% for the balance of the year Income tax item $00M benefit included in guidance currently expected in 3Q Excluding FitzPatrick 35

37 208 Guidance Sensitivities Prepared February 208 Variable Utility Retail sales growth for existing customers Description of Sensitivity % change in Residential MWh sold % change in Commercial / Governmental MWh sold % change in Industrial MWh sold Estimated Annual EPS Impact +/ / / Non-fuel O&M expense % change in expense -/+ 0. Rate base $00M change in rate base +/ ROE 00 bps change in allowed ROE +/ EWC Nuclear capacity factor % change in capacity factor +/ EWC revenue (energy) $0/MWh market price change +/- 0.0 EWC revenue (capacity) $0.50/kW-month change in capacity price on nuclear capacity +/ Non-fuel O&M expense % change in expense -/ Nuclear outage,000 MW plant for 0 days at average portfolio energy price in (0.04) (lost revenue only) 208 (assuming no resupply option exercise) NDT earnings 00 bps change in equity return +/ Consolidated Interest expense % change in interest rate on $B debt -/ Pension and OPEB 25 bps change in discount rate +/

38 207 Integrated Report 207 Integrated Report integratedreport.entergy.com 37

39 First Quarter Earnings Summary First Quarter Earnings Summary $ in millions Per share in $ As-Reported Utility Parent & Other (64) (54) (0.36) (0.30) EWC (8) (28) (0.0) (0.6) Total Less Special Items Utility Parent & Other EWC (78) (95) (0.43) (0.53) Total (78) (95) (0.43) (0.53) Operational Utility Parent & Other (64) (54) (0.36) (0.30) EWC Total Calculations may differ due to rounding 8.4M and 79.8M average fully diluted shares outstanding for Q8 and Q7 respectively For additional details, see Appendix A in the earnings release 38

40 Regulation G Reconciliations Table : Consolidated and EWC EPS Reconciliation of GAAP to Non-GAAP Measures Q8 and Q7 (Per share in $) Consolidated EWC Q8 Q7 Q8 Q7 As-Reported (a) (0.0) (0.6) Less Special Items EWC Items associated with decisions to close or sell EWC Nuclear plants (0.43) (0.84) (0.43) (0.84) Gain on the sale of FitzPatrick Income tax benefit resulting from FitzPatrick transaction Total Special Items (b) (0.43) (0.53) (0.43) (0.53) Operational (a)-(b) Calculations may differ due to rounding 8.4M and 79.8M average fully diluted shares outstanding for Q8 and Q7 respectively 39

41 Regulation G Reconciliations Table 2: UP&O Adjusted EPS Reconciliation of GAAP to Non-GAAP Measures Q8 and Q7 (Per share in $) Q8 Quarter Q7 As-Reported (a) Less: Special Items (b) - - Estimated Weather (c) 0.09 (0.6) Income Tax Items (d) 0.03 (0.05) Adjusted EPS (a)-(b)-(c)-(d) Calculations may differ due to rounding 8.4M and 79.8M average fully diluted shares outstanding for Q8 and Q7 respectively For additional details, see Appendix C in the earnings release 40

42 Regulation G Reconciliations Table 3: Normalized ROE Reconciliation of GAAP to Non-GAAP Measures LTM Ending March 3, 208 ($ in millions) E-AR E-LA E-MS E-NO E-TX Utility As-reported earnings available to common stock (a) Add back: Preferred dividend requirement (b) Income taxes (c) As-reported income before income taxes (d) = (a)+(b)+(c) ,57.8 Less certain items (pre-tax): Weather (e) (28.) (4.6) (5.9) (0.6) (9.3) (58.5) Regulatory credit for tax sharing agreement (f) Normalized income before taxes (g) = (d)-(e)-(f) ,574.7 Affiliated preferred (h) Normalized income before income taxes, adjusted (i) = (g)-(h) ,447. for affiliate preferred State-specific standard income tax rate 2 (j) 37.5% 36.40% 36.25% 36.59% 33.0% 36.45% Income tax at state-specific standard rate (k) = (i)*(j) Normalized earnings (l) = (g)-(k)-(b) ,035.7 Average common equity (m) 2, ,274.9, ,78.7 0,843.6 As-reported ROE (a)/(m) 6.9% 6.3% 9.9% 0.4% 7.0% 7.5% Normalized ROE 3 (l)/(m) 7.5% 0.0% 0.4%.% 7.8% 9.6% Calculations may differ due to rounding Utility does not equal the sum of the operating companies due primarily to SERI (as-reported income ~$8M, normalized income ~$9M and average common equity ~$75M) and preferred dividend requirements of Entergy Utility Holding Co. 2 Represents a weighted average rate over last twelve months 3 Normalizes weather and income taxes; does not reflect regulatory ROE, which includes other adjustments 4

43 Regulation G Reconciliations Table 4: Parent Debt to Total Debt, Excluding Securitization Debt Reconciliation of GAAP to Non-GAAP Measures Q8 ($ in millions) Q8 Entergy Corporation notes: Due September Due July Due September Total parent long-term debt,850 Revolver draw,25 Commercial paper 655 Total parent debt (a) 3,630 Total debt 7,680 Less securitization debt 520 Total debt, excluding securitization debt (b) 7,60 Parent debt to total debt, excluding securitization debt (a)/(b) 2.2% Calculations may differ due to rounding 42

44 Regulation G Reconciliations Table 5: Operational FFO to Debt, Excluding Securitization Debt Reconciliation of GAAP to Non-GAAP Measures Q8 ($ in millions) Q8 OCF (LTM) 2,652 AFUDC-borrowed funds (LTM) (49) Less working capital in OCF (LTM): Receivables (23) Fuel inventory (26) Accounts payable 8 Prepaid taxes and taxes accrued 36 Interest accrued 5 Other working capital accounts (25) Securitization regulatory charge 2 Total 69 FFO (LTM) 2,534 Add back FFO specials (LTM): Items associated with decisions to close or sell EWC nuclear plants (pre-tax) 08 Operational FFO (LTM) (a) 2,642 Total debt 7,680 Less securitization debt 520 Total debt, excluding securitization debt (b) 7,60 Operational FFO to debt, excluding securitization debt (a)/(b) 5.4% Calculations may differ due to rounding 43

45 Regulation G Reconciliations Table 5 (continued): Debt to Operational Adjusted EBITDA, Excluding Securitization Debt Reconciliation of GAAP to Non-GAAP Measures Q8 ($ in millions) Q8 As-reported consolidated net income (LTM) 476 Add back: interest expense (LTM) 670 Add back: income taxes (LTM) 578 Add back: depreciation and amortization (LTM),390 Add back: regulatory charges (credits) (LTM) (4) Subtract: securitization proceeds (LTM) 50 Subtract: interest and investment income (LTM) 249 Subtract: AFUDC-equity funds (LTM) 04 Add back: decommissioning expense (LTM) 386 Adjusted EBITDA (LTM) 2,993 Add back special items (LTM pre-tax): Items associated with decisions to close or sell EWC Nuclear plants 5 Regulatory credit related to tax reform (56) Operational adjusted EBITDA (LTM) (c) 3,448 Debt to operational adjusted EBITDA, excluding securitization debt (b)/(c) 5.0x Calculations may differ due to rounding 44