NI - Earnings call transcript Q1 2018

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, ladies and gentlemen, and thank you for standing by. Welcome to NiSource First Quarter 2018 Earnings Conference Call. At this time, all participants are in a listen-only mode to prevent background noise.

We will have a question-and-answer session later, and the instructions will follow at that time, and as a reminder, this conference is being recorded.

Now, it's my pleasure to turn the call to Mr. Investor President, Vice Hulen, Relations. Randy Please go ahead.

Randy Hulen

Carmen. NiSource quarterly you, Good morning, the to welcome and investor everyone, Thank call.

The call Joining drivers, operations, me performance well Donald Officer. as and Chief for and Executive of this morning of update are financing Brown, Joe the first provide Chief plans. XXXX NiSource's an to growth review is Hamrock, quarter Officer; purpose financial today's as Financial our on

remarks, we will open to call questions. prepared the your our Following

our call, supplemental slides. we are will on this to available referring During slides earnings be These nisource.com.

Before turning to Joe just Donald, and reminder. the call over a quick

of conference Risk cause the Factors uncertainties concerning SEC such looking. risks forward Some and from results made is statements subject filings. periodic uncertainties statements. Information included and the materially during in actual call will to expressed and are MD&A statements this sections risks to be the could our in that of differ These those

the addition, statements made of call non-GAAP measures. this on In some relate to

information now directly additional slides the most please information over I'd out additional to nisource.com. of the all financial available With Joe. measure these call to of the at which comparable measures, segment schedules on like and and our supplemental reconciliation turn that full the refer For a includes to way, GAAP

Joseph J. Hamrock

look our for deliver at in share has much reform, deliver and on which the cover, of investment, start non-GAAP operating Thanks, had investors. track to our earnings slightly on year execute strong XXXX. our per Randy. for $X.XX which about we're right and earnings, a share on communities, guidance net you as jump thus Good within far clarity NiSource to team range morning, some creating continues to per made our to regulatory to well-established expectations for This everyone, joining of strong slide value XXXX, of commitments X, delivered federal We're $X.XX XXXX operating getting XXXX. in the NiSource on net $X.XX us. There's exceeds we customers, Street and thank let's We versus that's our XXXX. earnings so start $X.XX customer to in and plan of the to key accomplishments on pace outlines $X.XX. implementation for and tax capital

We remain $X.X $X.X to on in utility plan also infrastructure invest billion XXXX. billion our in to

our quarter results, executing financial first well case on including teams agenda as rate Maryland, Massachusetts, base rate the also Pennsylvania. in filing regulatory as Beyond in a cases are Indiana our reaching and a robust Gas settlement base

manage tracker extension in is gas projects Integrated and year Indiana in to and executed our Resource transmission Additionally, long-term Environmental expected yet another our and to dates (XX:XX:XX) initiated as these for approach as reform, nearly Plan execute annual our two in-service this revenue later replacement our timely upgrades program. manage base regulatory customers. clarity Act tax also approved well of at of and well beginning rates Indiana, Ohio, filings, are help we've and Regulators and business we federal Jobs program. transmission in our continue programs the around outcomes offset all to as the increase Schahfer We've complete to across the to request the latest from through and year. a implement in of cash Michigan extensions and team gas with cases engaged as modernization providing initiatives distribution process tax stations, to are impacts with With the emerging Pennsylvania, modernization Maryland, implementation are cash of continued we're effectively Tax management. the pending our of and lower the well flow update similar With recovery modernization And stakeholders rate In benefits to program, electric on largest tax in Ohio's the benefits balanced long-term regulators these tracker infrastructure used program business, reform, which Maryland. of Cuts ensure investments. stakeholders customers. and infrastructure our our and way generating to respect City we're Indiana, are major the system jurisdictions under electric this Massachusetts on which to able with

offering you of offering a we have resolves equity and additional release block cash through for this negative million. announced This no equity common morning, separate in press saw completely our approximately any of reform, As plans likely credit we've a common offerings and $XXX impacts horizon. tax block planning

the turn will more and over Donald in financing to detail. Donald. plan our like I'd performance updates to discuss who Now, call financial

Donald E. Brown

Joe, hello, everyone. Thanks, and

be results to million biggest effects XXXX. about performance impact $X.XX our of reform modernization first million with on to on and investments, regulatory operating slide strong we tax of by X, Slide trackers. of consolidated financial the infrastructure demonstrates the Moving our X about net long-term earnings of of or our delivered the per same The share continues in in infrastructure non-GAAP period in supported $X.XX compared outcomes driver solid $XXX share our quarter established per results. $XXX or the

tax due XXXX. lower net Act result Cuts Tax a $XX reserves set regulatory offset Our of decrease of the taxes. by the down revenue was to were primarily decline revenues rates consolidated about income a Jobs by in This and million, as

for business Let's turn non-GAAP our the financial segment. results now to

quarter operating earnings earnings the about same operating about distribution the of segment for operations gas Our $XXX of $XXX in million million of compared with had period XXXX.

which the taxes, a $X million. the of income nearly increase tax excluding quarter-over-quarter earnings was of operating consolidated depicts, X reserve, reform in slide is offset As impact

million our reported million higher the for $XX approximately period segment operations XXXX. million of increased electric excluding quarter, over slide again, about covered an increase $X of same Our Once also customer was customers of investment and operating revenue improvement We're This And and been for electric has us. service of affordable segment increase by tax on XXXX. a regulated expenses. and about infrastructure we've enhance earnings reform, our making manage priority. maintenance is of to $XX the better the our for the internal which revenues earnings flattening to impact reserve X efficiencies find process on significant focus operating progress operating effort an make our by Keeping the expenses lower and launched area operating value. expenses, from driven for an from

profile. like briefly slide to on our and turning I'd debt credit Now, to X, touch

in debt At lower equity capital basis weighted end XX. X.X%, which I'd first XXXX about the approximately Our more was which will now equity details points common our provide additional long-term offering to covered consisting infrastructure is XX liquidity of reduced approximately maintained than within cash years, impacts offering, long-term and This as term a XXX was in we ample quarter, securitizations. separation. tax as on our net was debt long-term investment about XX, the we billion, $X our average to which interest million, very like than cash XX turn liquidity billion programs. rate about March cost our ensure through manage April help we period The and weighted available months remaining facility that of the of loan accounts cost level on of reform. our this was $XXX available of block under added X expires credit our maturity for to And is and of through the the and effective average and $X.X of about debt. some time XX capacity to receivable slides $XXX million sustainability

which financing agreement our previous to stock you million As and $XXX to million have XX equity announced expected issuance the seen may net is entered cash reform million plan designed other million. This and fund approximately into range XXXX issue with back $XX of have financing equity of on this a programs. XXXX. a planned consistent growth and With common sell our equity track long-term nearly this for shares from puts through common block morning, in investors million of impact XXXX to are additional resolve private includes employee we placement already, that block of stock our no institutional accredited with equity and program us tax an remain and common $XXX purchase to to to select from proceeds completely we in our plan, annual million issuance we an issuance, Other XXXX, news ATM or to investments. currently $XXX $XX previous

preferred equity content expect We or credit equity subordinated rating debt with to with supplement provides non-convertible that the agencies. incremental issuances long-term these debt, equity

This puts to XX% by As of completed to profile improving by forward. to back credit equity strengthening the illustrated our in to on metric going operations to slide balance recently capital transaction the low range XX, sheet from uplifts and debt ensure a of beyond. XXXX end our and strengthening XX% XXXX our XX% funds access trajectory on us the cost

the who turn investment, back call I'll Joe infrastructure a few and highlights. Now, regulatory customer, will to discuss

Joseph J. Hamrock

Thanks Donald. update, for that

investments of program some safety request recovery order gas latest filed revenues application billion Now, in gas let's in associated agreement half upgrades filed, the update, settlement seven-year a $XXX customer reduction infrastructure and would of increase approximately approved We've investments In safety The Public million made approved would system of Utility service investments rate approved Utilities of nearly second a order from application expected on annual in adjustment turn million. The previously in lines. order made $XX recovery rate DPU Ohio, modernization seeking filing for expenditure investments case, allow And the of to customers in underground costs and expected XX, continued through pending case not continued allows implementation from priority is in currently a are with schedule to XXXX into other us capital a more Commission impact an the the $X.XX reform our this since in July. In case. the made since to We're the the in remains by our pipelines. begin filed recovered first request. capital recovery in infrastructure second Utilities, the deferred tracker, a as the base through Massachusetts a with awaiting authorization to support Department and base and March increase the associated rider, in covers January to the in increase us well-established distribution in tracker quarter half $XXX million impact it XXXX XXXX. tracker of filed annual reduces under under NIPSCO existing allows the Massachusetts, this that of operating by replacement modernization upgrades tax $XX as investments replacement to NIPSCO begin we and rates approval pipeline pay An costs replacement natural modernization by gas operations for we a would a well-established natural the program. XX. filing which request supports This reform, and Ohio, infrastructure procedural IURC filed, filed number than in base plan system If the in program Indiana. mainline the allow Also on program. commission. reflects recovering Public approximately of for The of Pennsylvania, for net underground original also System the increase with of expected slide commission half adjust invested initiatives tracker. highlights tax XXXX. pipeline week, In enhanced capital incorporates and Pennsylvania revenues revenues extend case legislation. through in is A of of Gas An of of XXXX. recover to our The slight is mandates quarter with XXXX. the infrastructure. new is specific early filed, request Enhancement last with the and the has our And trackers. rates million XXXX the If extension of settlement covering IURC increase allows expected February which ,seeking fourth of our begin year. by to proposal to on gas Massachusetts, our If second targeted regulatory which increase gas our pipeline the reliability. measures We reform we filed An incorporated we approved as annual replacement tracker. it Also XX, XXXX. the state approximately federal its to programs $XXX five-year just $XX rates On infrastructure of about approved for in tax this associated February to of infrastructure upgrading distribution decision system case, infrastructure in program and and Public annual pending federal of Indiana, expected of Also Plan. expected this million gas approximately XXXX. would approved costs represents second pipe XXXX Commission million. gas quarter received is

result XXXX of And effect rates in replace aging million, service the took Our pipeline of approved capital If would Commission, filed order increase gas rate an of investments about filed, adopt XXXX. the The is so by end May annual $X distribution Public and Act pipeline for and A continue application the in upgrades. adjust recovery corporate new annual rates federal rate can X. $XX tax expected safety the Service incremental Maryland, million. under Cuts case approximately a base also Jobs to rate we adjustments and XXXX. reflects Tax with revenue authorizes on seeking of to as we reduced proposal of PSC

on completed which with constructively stakeholders retire the on to let's The initiated this submitted customers' this XXXX submitted which be meeting Now, fleet NIPSCO's be are the in including plan way develop NIPSCO's under to on expected be end expected end XXXX Through year, and by XX% in X, long-term IRP, plans. the Investments is of to its end to Combustion needs. IURC details operations of X process, the recovery energy XX of the Residuals month. slide of R.M. in Schaefer we the to our these XXXX Units contain are costs. will capacity expected to Units and turn Generating well plan Coal million. additional authorizing These by In NIPSCO approximately of cost at upgrades and plan November settlement a Station our we XXXX City generation are resource Michigan projects approved IRP this meet environmental coal-fired $XXX total last Bailly IURC balanced by a XX XX. and retired at electric working include the outlined to long-term integrated facilities. December the XXXX, schedule to XX and process Unit March. XXXX, Under projects associated electric projects generating of the

distribution through includes January electric infrastructure covering approximately of latest on electric infrastructure and our investments to tracker filed expected in execute safety Indiana, further from our program IURC XXXX modernization to be before system in request XXXX and improve the November on electric The to designed continue through We pending reliability. The system program XXXX to million approximately $X.XX seven-year approved remains which enhancements transmission XXXX. and made May IURC. XX, made $XX represents update investments billion

projects and mid-XXXX. on Our two to remain XX-mile schedule projects and to major XXX-kV expected and transmission system XXX-kV complete electric by be are are flexibility reliability. region-wide XXX-mile The enhance designed

about takeaways team's through months of execution I'm XXXX. these early some up, proud wrap just key As NiSource. the we of

the January service new our temperatures few with of We the years demand coldest in weeks Massachusetts and for served sub-zero since polar XXXX The in in XXXX of footprint gas peak vortex Virginia. and some in were first areas.

reform our of in financial commitments maintains strong preparation also our the of sustainability for capital with combined winter that our I'm will our the going all impacts a proud well enjoy. customers due our resolving our tax Our forward performed of to in activities the savings that work enhances of investments prudent team's our plan way ensured systems and customers.

operational, check nisource.com. like you'd continues NiSource across which encourage well-established is confident financial many set sustainability integrated focus, and annual create out more performance month even we're second years of published for at to factors, business sustainable report, social, than and more ever our to and our that value is available our last a customer-focused come. strategy about I we If detail you to

billion to range to to investments. $X.XX For in in track investment to to remain investment of XXXX, our investment billion in your in the capital execute and identified on complete dividend deliver against $X.XX annually $X.X for than earnings all $X.X robust We more expect we our continue non-GAAP long-term earnings to net support $XX With operating billion per share we opportunities. X% through for by while operating both maintaining grade participating ratings. credit today NiSource. X% continue expect and grow our our you of ongoing Thank and to to XXXX plans, and to interest

Now, up let's open call your Carmen? questions. the to

Operator

Thank you.

Ridzon Paul question first KeyBanc. with is Our from

Paul T. Ridzon

Good morning.

Joseph J. Hamrock

Good morning, Paul.

Paul T. Ridzon

traction. quarter continued a your and regulatory solid on Congratulations

had IRP, some Just The announced? a couple could we is more questions. chance there a retirements that see

Joseph J. Hamrock

the retirements just it. new and revisit is both IRP that retirements at more timing Everything the we'd of I at in way know the the but profile. look inherently don't that we capacity we in we all look the of on table capacity announced, as planning, see

that across watch So, the space year.

the putting scenarios show information website and the that is on that stakeholders. We discussing will are range that stakeholder evaluating with NIPSCO of we're part our the and full of engagement

Paul T. Ridzon

just is absolute talk Okay. O&M O&M, that the clarification, line? a flattening And is you untracked when that about then or O&M

Joseph J. Hamrock

When refer move tracked the actively O&M, we O&M O&M. we that about can to the time, but manage in we're non-tracked untracked the say really

Paul T. Ridzon

group? in you a do then private many placement of how investors were have And sense the

Donald E. Brown

is the six and there participated. Yes, were investors transaction complete,

Paul T. Ridzon

much, you guys. Thank Okay. very

Joseph J. Hamrock

Thanks call. for Paul. the Thanks,

Operator

you. Thank

question Merrill Bank from with Julien Lynch. comes of next Dumoulin-Smith Our America

Julien Dumoulin-Smith

Good Hey. morning.

Joseph J. Hamrock

Good morning, Julien.

Julien Dumoulin-Smith

Congratulations.

some address have Obviously, if the extent various will? XXXX on try going as you cost of you from can mitigate clarify might moving to So, on perhaps you issues, what To and transient the back the half of in the placement well. of about factors dilution private factors, is the long-term specifically? you first how these here, just sort X% X% of question timing rate your some case XXXX as think to incremental some here, trajectory you to management the

Donald E. Brown

Thanks, Julien, the question. for

we've about I it's what and regulatory the then on consistently our earnings impact to year, financing, tried think our outcome think the and and we biggest, has O&M. year is then it's typically earnings say to is biggest So,

so, And levers and earnings going we're year when this you of at. looking about think those that forward, it's our all

the of outcomes and our outcomes it of been the terms the In mix, around year, first in in focus timing within flat here can regulatory even see you last quarter ours what O&M those of this O&M. has results certainly and a

the who investors reform tax clarity the cash interest get flows. of to largest We and levers of the need timing done had tax and significant lever that we to thought savings we So, those And on now hit that on some year. the a impact and to for out earnings of expenses from past. anticipating then commitments that the financing we is we thought to and passback the are of safety that so once stock we our have our we're our the overhang around to sure and was equity, as there for lever were at it plan, had we our good around calls programs, just our some managing opportunities equity, investors will capabilities and that was good around the that get in is the is and program our time, thought regulatory equity, reliability a the manage had but the pulled that where make service as meeting the there so obviously, out our from really same here it our little the was a to certainly issue because also of O&M in early go well

Julien Dumoulin-Smith

of expect your the here as from to been even you right? raise year, record of earnings middle like necessarily suggest the deviation (XX:XX:XX), anticipating track this kind very and part period you growth wouldn't historic to clarify, short-term this guys equity Right. any sounds But you have just it real

Donald E. Brown

always it ability capabilities No. of on the is that this No. expectations the end high hit through we to Yeah, we've and That's hit change end to not programs, think our high that range. right. the said that that range, our – does our got we've of

Julien Dumoulin-Smith

different in in kind it XXXX call you isn't didn't respect And with achieve an perspective. what did of Right. for you this earlier tax recently the outcome expecting the from debt similarly, se, settlement, the hear cash were to from reform per I materially flows necessarily FFO but to

Donald E. Brown

referring you to the settlement? Are NIPSCO

Julien Dumoulin-Smith

you let I'll exactly. respond. Yeah,

Donald E. Brown

taxes, Actually, absolutely. was passback favorable No, of terms deferred excess very a Yeah. XXXX. of it the that doesn't the until in start outcome

was perspective. cash positive flow that so, us And a a for upside from

the think in Pennsylvania filed rates that in look rate Massachusetts, orders on effect Maryland, the base cases. pass we've and cases you I and rate to those other back as at gotten upon we those going in savings

so, And cases NIPSCO that positive around the we both some rate the as cases, timing as well had rate filed. settlement the we've

Julien Dumoulin-Smith

enough. Got Fair leave it Thank it. All right. you. I'll there.

Joseph J. Hamrock

Thank you.

Donald E. Brown

Julien. Thanks,

Operator

you. Thank

Evercore Our next question comes ISI. from Greg Gordon

Greg Gordon

morning, guys. Good Thanks.

Joseph J. Hamrock

Good morning, Greg.

Greg Gordon

subordinated or the Very majority page have the answered. my debt have of equity. On clear questions for been TBD you frankly, and preferred in X, columns non-convertible

there's of said sort is get done the tad activities? more that – program. margin You range of the equity through to nudge implication them on that common into you'll metrics sort tax there a do just through and the portion the of those you're offset But just those that credit on completely to with the here work the

Donald E. Brown

Yeah.

I the program, get understand doing the since content preferred and flexibility what ATM in versus non-convertible equity to of make equity what's value there. or really you versus trying doing at at securities, of debt cost debt all-in as a equity we're securities the so range, think, that those the it really common including looking the on those provides equity really flexibility way some we and type do look having in to sure or is

So, that's (XX:XX:XX).

Greg Gordon

you net average everything to over have confident of – Great. restack high succinctly, at you're the to X% to a X% still end more from the bit that preferred the time. guidance on be count dilution the Julien's earnings pretty Okay. or still higher little levers just debt you then feel question costs, comfortable pull range ask or share to with of And when you

Donald E. Brown

changed. the Again, that Absolutely. driver, outcomes regulatory are typically hasn't the and biggest

haven't and changed, those programs hasn't strategy Our changed.

top confident end And we that can so, of the hit range. the we're

Greg Gordon

care. Take you. Thank

Donald E. Brown

Thank you.

Operator

you. Thank

Suisse Michael LLC guys. from Hi, with Weinstein. is (USA) question - Credit Michael next Mike This Suisse. is Weinstein Weinstein Securities Credit Our

Joseph J. Hamrock

- question think What measures now order Credit flow Securities Michael impact morning, Good outcomes and Ohio have accomplish you. Weinstein Suisse tax in to cash mitigate to (USA) LLC the settlements Hey. the A in or need of you for other you Mike. quick that reform? do Indiana you

Joseph J. Hamrock

looking We're us. FFO at for matters everything. Obviously,

looking in and of something pretty that we're with O&M teams it's we're regulatory we're it's so, our FFO, Otherwise, that Suisse all next improving Michael staying closely. (USA) more are driver in about touch obviously - rate really programs, biggest at And is Securities I cases. our Weinstein probably settlements, there those Credit is around getting additional managing of and LLC the managing terms about flow. regulatory, So, point, guess, at this it than right, cash O&M

Joseph J. Hamrock

Yeah, that's right.

about But - Suisse it. Any (USA) think those or they going QX. Michael to would LLC cash settlements Got timing in you program. QX cases, have Securities I than from be potentially, you If Credit less Weinstein our are rate of QX, take. O&M absolutely overall those the material

you. Thank Okay.

Operator

you. Thank

Our next Christopher question Turnure from is JPMorgan. with

Christopher James Turnure

Good morning, guys.

Joseph J. Hamrock

Good morning, Chris.

Christopher James Turnure

as have right the here where questions of that? been I will wanted Is of a private that any forward you dilute issuance well, component common Most or is straight but my it of kind away there on answered placement. ask to

Donald E. Brown

issuance. straight component. No, common There it is is forward no a

Christopher James Turnure

you equity Okay. of I end kind the through internal you $XXX plan the years your $XXX year first And look for think the numbers million about pretty million ATM hitting that then well and of into kind on and this And at that within three quarter we to both already. question same Can range then, next of you're of when the per range. for we issuance, guess, year? two the top next the year CapEx to

Donald E. Brown

done financing that it metrics. you execute the We it look I see million, forward we $XXX $XXX reason ATM the about that program, does that on and the the for in did at is a on will this like year. already. contract needs QX in I so, slide, Again, provide ATM our flexibility million program think, we've hitting as and, so We'll around

if to would next early million say we too than it's this think use more year I $XXX year. the or

year. kind gives to again... where end I see make that in that this XX% think of range. flexibility of we'll early, us it it's too the it just above will but And we're sure next year, but by be the are, we that And

Christopher James Turnure

Okay.

Donald E. Brown

out around And of passback regulatory that the that the rate base lower end again, deferred the where the taxes, part those terms comes to million. the of will and excess that of cash million $XXX of push of our cases, flows that particular $XXX range, higher of outcomes it in or in are to end

Christopher James Turnure

then you to with a And to the coming on of expenditures? those have make you years or kind balance assumption these are room sheet Okay. the CapEx flexibility at that guys side, CapEx kind into ranges that to need just lower be the end of of

Donald E. Brown

not at No, all.

impact on much it And range about the think and regulatory or I think FFO, our point. if is this a than programs. O&M has pretty tight that change. to smaller our CapEx at programs We impact don't you expect

Christopher James Turnure

Okay. Thank Great. you.

Joseph J. Hamrock

Thank you.

Operator

Thank you.

Our from Goldman Lapides Michael next is Sachs. with question

Michael Lapides

stuff. of Hey, a little housekeeping actually, guys. questions A bit couple of

what XXXX offsets meaning forward, or of First, are in balances you to can you NOL taxpayer then going a potential and kind remind level taxes? us cash and cash kind what of

Donald E. Brown

Yeah.

continue we we will act, the be have not and and NOLs about until to tax with reform So, our cash even XXXX. expire NOL taxpayer, will

Michael Lapides

Got it.

Donald E. Brown

next taxpayer. the over be a few still we So, won't years, cash

Michael Lapides

Okay.

sizable of NOL cash. long-term source benefit, a So, that's

of rises that grow, So, earnings lockstep a growth. cash bit with kind as of in source earnings little

Donald E. Brown

That's correct.

Michael Lapides

Okay.

I I that. Second, in Gas the NIPSCO make sure understand to want settlement,

is after out, one-year bottom there tracked over does or of O&M million, there $XXX line – or years? tax O&M is that a uplift offset or spread revenue out all or is coming all First higher spread that a even that that to And of rate all, in couple that? a the that D&A a might is coming higher untracked that drop

Donald E. Brown

$XX.X settlement, $XXX was it $XX there is component at year steps depreciation. October about depreciation. was of rises to starting so million It million three annualized, and in XXXX. rate that then it Yes, of big case actually rate case that in by this million A

that's million, really already net And into that really and the earnings That no additional pickup. our historic so, is O&M if your There plan. results baked $XXX that. to was margin or year you and $XX component current million

Michael Lapides

Got it.

or words, the that's on D&A not effect. you million booked a D&A new kick other statements when the higher that showed D&A in in rate you a of So, higher or $XX rates go amount will into D&A, XXXX. your That's income

Donald E. Brown

is Absolutely. that correct. Yes,

Michael Lapides

about it. the I years, the think, And then from thinking over, you $X.XX remind the last is that billion program, it's investment last an can gas Gas Got us, thing, uptick just program? seven investment NIPSCO

Donald E. Brown

$XXX million it previously. about Yeah, was

Michael Lapides

it. Got

guys. and quarter. congrats Much you, appreciated Thank on Okay. good a

Donald E. Brown

you. Thank

Operator

And is Fidelity. Carrie from our question Louis with next Saint

Carrie Saint Louis

Hi. Good morning.

Joseph J. Hamrock

Good morning, Carrie.

Carrie Saint Louis

for proactive with the so your a equity just bit new funding the Thanks issuance. more little plan about and I to ask wanted much being financing.

and to slide think see sources is the on I So, that should it this expectation $X year, all of up X equity, the I about closer add be this billion? if I a

Donald E. Brown

$XXX done We've $XXX Well, did million yesterday million. there's so million $XXX we – $XXX so the we're million, as plus already of at ...

Carrie Saint Louis

Yeah.

Donald E. Brown

...for the year, with, more we again we'll at ATM into the the of tap the but through whether year program. balance look

Carrie Saint Louis

Okay.

Donald E. Brown

that... at looking additional million so you're an $XXX But or

Carrie Saint Louis

And the on programs benefit other then Okay. top that? of

Donald E. Brown

correct. That's

Carrie Saint Louis

to $XXX that and continue $XX latter annual in million to the million on programs then $XX And Okay. two range. basis $XXX million million an

Donald E. Brown

That's correct.

Carrie Saint Louis

XXXX, some the I'm at looking I right for year. now when then if in million but on any see zero I debt, of incremental forget to part the you've first your Bloomberg, $XXX long-term don't And the Okay. on had maturities

the what to look for number could you like? year, going that total debt is remind the just issuance So, me

Donald E. Brown

somewhere that us well again, as the range finance range. subordinated would as it we're in year, finance balance both see equity the this ATM to already long-term year. be value non-convertible lot be so helped as will debt block the best at as the to what's looking But It in this the this well of – for help of debt a

Carrie Saint Louis

Okay. But hybrids. I'm saying is I of $XXX is debt, be it include I'm but you're going what to or either refinancing, saying doesn't you're that's debt guess, the assuming suggesting what new million so that's

Donald E. Brown

correct. That's correct. That's

Carrie Saint Louis

Okay.

Donald E. Brown

million, $XXX a a maturity QX had over $XXX in We little of about million.

Carrie Saint Louis

Okay.

there? then in might that be amount if include $XXX million I So, the

Joseph J. Hamrock

Yes.

Carrie Saint Louis

the risen So, through with, issued. comfortable from an using your $X rates That's And kind ability had short-term any your of rating was billion, the ongoing it current knowing Okay. getting quickly, you a that thesis billion commercial debt? level like And $X to use of short-term looks FX? I Is to what you Fitch there is like about just paper? CP can of walk then try what's that you're up have about at. get

Shawn Anderson

Good is This a That question Carrie. we Anderson. that to I will have morning, that. and Yeah. discussing Great we've Fitch, and is Shawn with conversation. been appreciate continue question

is close a loan good on use two. that bogey come for on of in hopefully mark when The April to actually that pretty basis. is billion of will billion And more provide expect of think in into you year. flexibility we $X terms of to commercial bit month-by-month pretty mark So, that for term the a us paper, $X this little to toggle But to at. you together, between what us be a those that us agreed

Carrie Saint Louis

point? at this so Again, it term is that fully Okay. drawn loan,

Shawn Anderson

draw we delayed which our over that at at feature. a the have discretion million, the It we commercial It $XXX balance, and then is paid close, We next turn has drew $XXX not. paper, have in XXX down days. million

Carrie Saint Louis

Okay. Yeah.

extend XXX hard a to our is So, days option it's or maturity. just

Shawn Anderson

Hard maturity.

Carrie Saint Louis

Great. Okay.

Shawn Anderson

as getting almost the would the The of almost the again, identical those are commercial to And program same what we rates think itself. in paper we were market.

at rate interest the some the we point some rise favorability had in environment. In throughout fact,

Carrie Saint Louis

levels FFO back debt FFO And and for slides. your Great. appreciate the I appreciate going to very the to you should – again, I target. color the much again, – I thank on

kind So, are that thinking going Is mid of should current of if tax to that credit these this reform. proactively like even quality, high obviously, ratings, things kind arise I and defending forward? unexpected BBB the committed kind and you have equity suggests coming issuing of in that

Donald E. Brown

That's right.

I think were to that last possible, explicit ratings. quarter, we maintain we anything to do these maintain to were what anticipating pretty was and were and these we ratings, current possible going expecting

Carrie Saint Louis

you you're ask And number, towards? are to be question mean, good really yourself of like so, would numbers hopefully, that I on or the let strong I gearing a XX% just be rating last the kind category? you that more where the that – me of kind more think, Is the focused is in get the on it

Donald E. Brown

and what they with that's that us want with ratings, discussions XX% be XX% in our to we're from the our Yeah, range agencies, current for to plans. targeting financing

Carrie Saint Louis

much. Okay. All Thank very right. you

Joseph J. Hamrock

Thanks, Carrie.

Operator

you. Thank

Fleishman Our with Wolfe next Research. from Steve is question

Steve Fleishman

Hi. Yeah.

strategic curious, kind Just got of Vectren the transaction announced? recently any from high-level takeaway that

Joseph J. Hamrock

or and and on billion growing activity, on focus the that programs morning. really on. identified Good the outlook growth executing to shareholder Steve. reiterating Vectren that's Thanks, those here today, Yeah. long-term our and and or that investments comment of speculate disciplined I sustained we'll continue remains current value, the market to $XX investment won't had we're we're programs capital evidenced and otherwise. We've have by approach a

Steve Fleishman

kind essentially actions And Okay. in any to from with statement of affirm would Carrie's question, fill agency rating the then from speak, the that following take so reform. a gap, to standpoint, just they just tax you

very what you are from they comfortable so, you? is And that had sufficient expected for this

Donald E. Brown

consistent regular to – plan this expectations the want financing agencies their I am conversations understanding No, metrics plan us our that about hit. we've year, had with they the and our for

evident was Moody's conversations off that agencies our last I list, update had with as the us transaction. watch they that think them staying equity to comfortable yesterday as with were with the the well Shawn plan. on week negative

to on be expectations. we So, and their think are right we're where want I hitting

Steve Fleishman

you. Thank

Joseph J. Hamrock

Thanks, Steve.

Operator

Thank you.

Jefferies. next Our is with from question Chris Sighinolfi

line Your open. is

Joseph J. Hamrock

morning, Chris. Good

Christopher Paul Sighinolfi

Joe. Hey, you? How are

Joseph J. Hamrock

Good.

Christopher Paul Sighinolfi

follow-ups two quick have Just hopefully.

clear the you First dead beat the to just referenced Donald, obviously, and that X, curious, million. on I don't I just see, ATM, want to slide a mean be here, on about horse I but, $XXX though.

cash that receive issue to those yet or shares, have You right?

Donald E. Brown

that correct. is not cash It yet. contract, have we That was forward and received a

Christopher Paul Sighinolfi

of you the that forward and forward do you in dividends because double and it's out Do the borrowed cover? those interim? sort on agreement, went to And have did Okay. get because a

Donald E. Brown

Yes, they the dividends. do They do. repeat

Christopher Paul Sighinolfi

Okay.

it then or correct I those... finally, dividend. were guess, Okay. placement, placement was that with this quarter's the missed And yesterday, that Is so

Donald E. Brown

Of course.

Christopher Paul Sighinolfi

Okay.

a the appreciate lot, guys. Thanks time. Really Okay.

Donald E. Brown

you. Thank

Joseph J. Hamrock

Thanks, Chris.

Operator

with question And Morningstar is Charles our Fishman from next Research.

Charles Fishman

showing like the I of reform recent Good segments. tax and on each job the NIPSCO Hey. on case? implied rate X, base Gas impact ROE X of the Thanks. on Hi. slide that. Was an there

Joseph J. Hamrock

Charles. X.XX%,

Charles Fishman

regulatory just Okay. And Ohio. other then question in one

schedule I assume Is non-IRP also just or so a gone long tracker there and I that's almost a to delay. the taking almost the of now that without months noticed it is You've the procedural on why get doubled. schedule? is pushback because recovery getting of on investments. six just the request procedural

Joseph J. Hamrock

No on to will, costs, so pushback. at I year. of schedule, that wouldn't there's If raise in there's that and an if deferred the resolution concern. now an The auditor approach It's underlying a procedural look investments. novel, those not has recovering really late there. commission it. progress remain still a assignment of to requested We progress you new, this confident filing

Charles Fishman

the that's doubling, that's of because revenue the delay? just And

Joseph J. Hamrock

That's just annualizing number. the

Charles Fishman

Okay. Got That's you. Thank all I it. have.

Joseph J. Hamrock

Thank you.

Operator

Capital. is And Andy from question our next Avon with Levi

Andrew Stuart Levi

guys. Hey, morning. Good

Joseph J. Hamrock

Andy. morning, Good

Donald E. Brown

Good morning, Andy.

Andrew Stuart Levi

done. equity the got you Glad

kind it? So, how just about on year's you've to we count million take guess, of make what share XX Carrie's or million done – of so that about already, we're to shares. got kind shares, and based my give sure kind about last number, year-end think of questions, I right take X I Is if answers, adding X or million

Donald E. Brown

million the equity yesterday completed No, XX issuance shares. we was

Andrew Stuart Levi

do be end the by XX No. will about cetera, to money, of saying, that the And at No. shares? year, the drawn, still No. to I million has What based be cetera, on et million end et at what of you're going it additional $XXX then... XXXX, the the was

Joseph J. Hamrock

we... XX Yeah, million say I'd it's probably so share, closer to

Andrew Stuart Levi

then because... walk Can through us that you

Joseph J. Hamrock

through so Yeah, (XX:XX:XX) ATM... the

Andrew Stuart Levi

talking I'm actual not about I'm Maybe talking shares. shares. wrong. average shares. Not I'm about average

I that, If great. through important. that to that get just you can right. us would It's be want walk

Shawn Anderson

Good morning. Shawn. is This

the private XX approximately shares. that discussed yesterday that placement was million So, commenced is

Andrew Stuart Levi

Okay.

Shawn Anderson

the million aggregate $XXX market an program of million The at cited X.X shares. that's the part of as has

Andrew Stuart Levi

Okay.

So...

Shawn Anderson

share Right just north of that XX million mark.

Andrew Stuart Levi

Okay.

Shawn Anderson

value that forward a price Obviously, the during stock different had construct.

Andrew Stuart Levi

Okay.

Shawn Anderson

... where it was to-date.

you at be the then Those accounting for been haven't haven't up potentially some maximum, difference pick million. there. So, that Donald's point, been and to priced would $XXX And that be another contemplated. might of helped obviously

would So, that where be your be would bogey that. beyond

Andrew Stuart Levi

Okay.

million it's like $XX use way, it's know, XX divided, hopefully, $XXX for the plus price. don't better a we'll So, million I better

$XX okay? and it's you whether that's shares forward Just... that's that million, at And that money? million So, you've totals issued, it's the all, how much done, that XX shares, already money, then the

Joseph J. Hamrock

money... Well, (XX:XX:XX) the

Andrew Stuart Levi

$XXX plus another million, the plus $XXX $XXX million million. is million $XXX

Okay. That's good.

Joseph J. Hamrock

That the Correct. would be maximum.

Andrew Stuart Levi

Perfect. Got it.

old Okay. I'm my slow I that. math new yet who do relative to math. I do kids understand

Okay.

get So, I $XXX there. that's aren't guess, your didn't kids a out mine. as young you as of laugh I million.

Okay.

on the much year, million. incremental it's million So, $XXX of how then million or like stock less. depending Maybe every year And price. shares that to that's it's something $XXX next XX $XXX million that

Joseph J. Hamrock

to stock would million total, the million The correct. on the that's $XXX Depending correct. $XXX price, that's be

Andrew Stuart Levi

the just we at the you is your X% rate Do an equity beyond guys now a Great. X% Okay. question through the some in general, relates or to I Day just have since point refresh And have XXXX. XXXX then growth when of to done to Analyst get on last rate? growth do plan

Joseph J. Hamrock

that The equity, in reform place Joe. CapEx on outlook our Yeah. next the Thanks of primary for year, this to have that an year. imagination, question. By beyond but next by late tax Andy, this much early is stretch would driver year, that. We're wasn't update XXXX. time the all we this going so likely there

programmatic, the is characterize on our today visibility As great the there. XXXX, that's of clear of you capital program of that bulk the capital stretch know, The the electric part side less generation are programs the beyond business. well

picture, we replacement more go integrated time. through updated the about is which we'll plan the this that As retirement resource we year, capacity than that refresh picture last

of we as today. will strategy, so, beyond CapEx that the that us And formulate have kind that through confidence same XXXX for we give XXXX

that early year, likely on time. looks the look this at late So, how planning for year more based this next

Andrew Stuart Levi

not I've priced kind was but at do actually one But told price very possible? lied. I math. do have the that good the can placement question. of what private us do it, at more not I can you I is you math. I can I then I'm mean, or tell And Okay.

Joseph J. Hamrock

last private placement of priced a night's at off close The discount. X%

Andrew Stuart Levi

very discount. Got you much. Thank it. X%

Joseph J. Hamrock

Thanks, Andy.

Andrew Stuart Levi

Yeah.

welcome. You're

Operator

call I his you. And Mr. And final for like Hamrock thank the turn to back would Joe remarks. to

Joseph J. Hamrock

everybody to thanks today for and and story. the ongoing in and Carmen, participating support you, for interest NiSource Thank your

we a and outlook on our reported that can on day. growth commitments, delivery see, the a of in you a is what all on manages great to stakeholder today those ongoing of reflection As Have we're balanced commitments. committed delivering way long-term

Operator

for thank a Have disconnect. and may today's , This And ladies concludes the gentlemen participating program, conference. and day. you in you wonderful all

Randy Hulen	NiSource, Inc.
Joseph J. Hamrock	NiSource, Inc.
Donald E. Brown	NiSource, Inc.
Shawn Anderson	NiSource, Inc.
Paul T. Ridzon	KeyBanc Capital Markets, Inc.
Julien Dumoulin-Smith	Bank of America Merrill Lynch
Greg Gordon	Evercore ISI
Michael Weinstein	Credit Suisse Securities (NYSE:USA) LLC
Christopher James Turnure	JPMorgan Securities LLC
Michael Lapides	Goldman Sachs & Co. LLC
Carrie Saint Louis	Fidelity Management & Research Co.
Steve Fleishman	Wolfe Research LLC
Christopher Paul Sighinolfi	Jefferies LLC
Charles Fishman	Morningstar, Inc. (Research)
Andrew Stuart Levi	Avon Capital/Millennium Partners

NiSource (NI) 2 May 182018 Q1 Earnings call transcript