CenterPoint Energy, Inc. (NYSE:CNP) Q4 2018 Earnings Conference Call Transcript

Feb 28, 2019 • 11:00 am ET

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CenterPoint Energy, Inc. (NYSE:CNP) Q4 2018 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good morning, and welcome to CenterPoint Energy's Fourth Quarter and Full Year 2018 Earnings Conference Call with senior management. During the Company's prepared remarks, all participants will be in a listen-only mode. There will be a question-and-answer session after management's remarks. (Operator Instructions).

I will now turn the call over to David Mordy, Director of Investor Relations. Mr. Mordy?

Executive
David Mordy

Thank you, Dennis. Good morning, everyone. Welcome to our fourth quarter and full-year 2018 earnings conference call. Scott Prochazka, President and CEO; and Bill Rogers, Executive Vice President and CFO, will discuss our 2018 results and provide highlights on other key areas. Also with us this morning are several members of management, who will be available during the Q&A portion of our call.

In conjunction with our call, we will be using slides, which can be found under the Investors section on our website, centerpointenergy.com. For reconciliation of the non-GAAP measures used in providing earnings guidance in today's call, please refer to our earnings news release and our slides. They've been posted on our website, as has our Form 10-K.

Please note that we may announce material information using SEC filings, news releases, public conference calls, webcasts and posts to the Investors section of our website. In the future, we will continue to use these channels to communicate important information and encourage you to review the information on our website.

Today, management will discuss certain topics that will contain projections and forward-looking information that are based on management's beliefs, assumptions and information currently available to management. These forward-looking statements are subject to risks or uncertainties. Actual results could differ materially based upon factors, including weather variations, regulatory actions, economic conditions and growth, commodity prices, changes in our service territories, and other risk factors noted in our SEC filings.

We will also discuss guidance for 2019 and 2020. The 2019 guidance basis EPS range excludes the following impacts associated with the Vectren merger: integration and transaction related fees and expenses, including severance and other costs to achieve anticipated cost savings as a result of the merger; merger financing impacts in January prior to the completion of the merger due to the issuance of debt and equity securities to fund the merger that resulted in higher net interest expense and higher common stock share count.

Both the 2019 and 2020 guidance ranges consider operations performance to date and assumptions for certain significant variables that may impact earnings such as customer growth, approximately 2% for electric operations and 1% for natural gas distribution, and usage including normal weather, throughput, commodity prices, recovery of capital investment through rate cases and other rate filings, effective tax rates, financing activities and related interest rates, and regulatory and judicial proceedings, as well as the volume of work contracted in our Infrastructure Services business. The ranges also consider anticipated cost savings as a result of the merger and the estimated cost and timing of technology integration projects.

The 2019 guidance range assumes Enable Midstream Partners' 2019 guidance range for net