ETR - Earnings call transcript Q1 2020

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

Operator

Ladies and gentlemen, thank you for standing by. And welcome to the Entergy Corporation First Quarter 2020 Earnings Release and Teleconference. At this time, all participants are in listen only mode. After the speakers presentation, there will be a question-and-answer session [Operator Instructions].

As a reminder, today's program is being recorded.

to President, host Investor like David today's now Vice Borde, Relations. would introduce for your program, I Please go ahead, sir.

David Borde

Good morning, us. joining and thank you for

We we Drew than one comments Leo will effort no to review with more Chairman who an each begin CEO, has follow-up. person everyone and ask questions, results. from In and Denault that our one Marsh, Entergy's then question accommodate CFO, request will and today to

differ forward-looking In which these obligation materially filings. today's any our to assume could management slide Actual call, SEC a are factors, and does our presentation in from certain statements of statements. update to make forth due earnings these forward-looking release, not statements. Entergy our results will number set forward-looking

discuss morning earnings GAAP a corrected our financial I would also the balance site. which press posted we non-GAAP since point in today's the this XX, have March can to Reconciliations Investor to sheet out measures clerical of Web initial the and and XXXX on included Relations version that release relating the error also slide both on contained applicable release information. Web section be our site. Management presentation, release our of a of are will found

the over And now I will turn call to Leo.

Leo Denault

good that circumstances of and we help everyone time your are need extraordinary well. in families you and communities appreciate country have up all all few and I this for stepped to and the you difficult the people, their have plate joining been morning, to world, around presented many so appreciate of efforts. truly our David, everyone. We and The Thanks, that our call hope today have months past

during events. is why Providing essential, these. extraordinary plan we times and That's safe and prepare for power like reliable Entergy, at especially

roles tried that leadership we and attacks, Our their To many, routinely everyone and run drills so storms, and smoothly. plan contemplates succession plan activated when response preparedness, tested the emergency including knows comprehensive, runs incident responsibilities pandemics. and robust, cyber ensure

to address we In XXXX, developed we one the our facing like are events plan, specifically response pandemic today.

teams we For our very mobilized early COVID-XX, January on on. XXth

on primary and wellness employees, our and only to normal service customers, safety Our for mitigating of ability objectives, future. four ensuring impacts financial also that plan improvements be our has reliable not safe to Informed to ensuring the focus from been made. the maintaining for events, lessons by continue operations but challenges our can learned the

designed. Our response working is as

the of communities. customers We needs are expectations our and and meeting

is The Our work employees to major They projects plan unchanged. remain their dedication our this have actions hurdles through pandemic in once capital the of midst have on resilience our of and exemplary. track and shown again been

has our keep this Entergy the power and not step critical Entergy I back. forward flowing express the is of cannot gas a customers. safely and family. play am our I proud to that to role time how for must we

a our successfully our manage facilities families not we care the are crisis. pharmacies require customers loved and do us on and us to to grocery home. and address stores than children great short, operate take essential hospitals, reliable ones services responsibilities Our work to healthcare are our that homes In power to we or vital at Businesses our neighbors, their and and keep workers for lightly. and responsibility on care have power many to powered. more as ever clinics helping to communities and provide our relying this customers, remotely, It's like depending needs, continue communities, are

also capital component plan Our economy our and our investment a communities. for critical is

stimulating economies states the our where Our creating plan also is operate. the designed we to while customers, and benefit in jobs

actions our specific taken stakeholders. each of have We for

on safety in measures, so the still job. they and implemented we've and field, plants employees focus the For working can preventative off at on

in important is which income. customers, not for many times a disconnects may where suspending steady have We're

are and our support determine capital talking for our the they face economic plan with how and track on understand to our them. of we benefits to to regulators largest reliability customers issues preserve keeping we're importance communities. the to And We the talking customers the about and our can

Our diligently suppliers to with of what to supply track. to have major matters. our we ensure, both chain timely we team need routine We're working is resolution and working keep on and special operations regulators with projects support

our expect received for Entergy to receive accounting our partnership defer commissions a demonstrated. and to in similar We're Orleans jurisdictions, COVID-XX grateful orders of associated for New in we We costs have leadership with the near that have future. four order and the

supporting Fund. Response We our COVID-XX are also communities through a

Our nonprofits and employees million the community financial struggling team, are executive help have impact and charitable committed qualifying $X.X already of to pandemic. the than foundation, who with customers, more

uncertainty guidance affirming our achieve remains outlooks and ahead, depth the But to are Looking and this we of pandemic. results. today, as length see a to we path those as

sustainability and business remains strength the in place. supports that our foundation of The

lowest in retail country. among the We rates have the

capital customers Our and economies. local benefits our our plan

We and mechanisms. regulatory constructive have progressive

a are critical We sustainability. leader of measures in

generation in respective industrial of while among the is base the seen activity, large some we economically most industrial they expect industries. will lead have recovery fleets. world, one in in we recent our scale have cleanest, We and advantaged the And their the slow down

resolve planned. established are is and what This our utility. over quarterly we've to Directors investment. a committed Entergy the as dividend that compelling firm our time we April, premier remains to of In and term declared long Board our be makes objectives foundation The a

As the our the part of forward. uncertainty going board our response considered the analysis of current scenario decision, to business and situation, future that strength regarding

are including declaration of dividend with consistent stakeholders, our value is We our all that the sustainable and objective. for to owners, committed creating

good in to service quarter March, in and making we We place pandemic schedule hasn't Power our execution. Today, adjusted stopped we're to solid us do earnings Power $X.XX. in share more milestone This cleaner, the New way And to strategy synchronized also we customers. it progress well turn at against the first strategic another Commissioning provide from transformation first per of our the plant replace Charles of grid business, is for recently Station. important portfolio has progress I'll our the with units generation to assets older reporting in key and Orleans Now resource the made progress time. benefits efficient the is of ahead budget. affected it will and Lake We've while on Station our deliverables. new

We expect June. that in project to come online

Our remain generation other track. projects major on

testament significant experiencing contractors. suppliers to the not are issues. strength is and capital any experience with of We management the This team our a projects relationships staffing our of our or equipment and

meters to continue planned. deploy as We automated

with meters through one installed. project X.X million our than more We’re third the of way AMI

from in changes our among data customer the leveraging meters these various are understand to We usage segments.

low value all solar resources power be In keeping the Sunflower facilities Arkansas. facilities on the provide rates and renewables. effective approval while utility the Mississippi, for XXXX. in delivering in be largest will April, projects best for solar customers, are we their in Solar solar Both expected in Large XXX to for Solar most cost megawatt scale in states. These received Searcy service

for targeting XXXX. new mid-XXXX. proposals our with part submissions with of for build turbine customers for X,XXX meet firm Entergy last our Texas Texas even than As economics options, two gas is build continue megawatt improve. and generation we Since of in and assets. contracted expect is Louisiana planning our to to X,XXX service option a supply power solar of for no due and Entergy megawatts commitment to more Entergy in we as requests owned to call, earnings technology will mid-XXXX combined of projects announced renewables needs renewable seeking will include of seeking with our self resources. proposals end proposals The are provide XXX to later RFP new cycle August. accept the dates greater

through implement to changes plans our continue rate riders. rate formula We and

were filed Entergy management In Mississippi a implemented or and our filing these recently plans Louisiana rates and law FERC. in annual rate go open renewal the I the received will request new in rider. included In need free extension we Feel additional you plan a of all New to one formula won't we new if July. decision make of FRP explanations. through an April, in call Arkansas Texas, from its initial energies rider. David coming we vegetation at dockets to this system administrative distribution details. judge

believe must that retail the opine ultimately bottom-line The much the decision, we actions correct. of and FERC seeks initial are on facts The with customers, incorrectly it strongly to and that the taken we that disagree for that, on. we create is our feel positions law our issues policy benefits we've important resolve significant and

the We will FERC’s rulings to mandated adverse in deadline FERC exceptions review. our forward commission's initial we file in to asking and the no reject for June look the the decision. decision, is brief There on

milestone who This willing Indian Point next exiting employees committed on business. them shut the to step X brings to one positions. the phase remain forward was are relocate XXth. Unit fully with us. closer offered merchant all their and At us April of qualified We starting been employees to careers look have We down our to EWC,

our been we COVID-XX mitigate and we it's early, as that positions the a a times the and well the us to We challenges can. focused right active head plan the we to at global and to affecting remain productive decisions activated will As is world. very already to Entergy, were see, the prepared make response ensure lives face on. impacts which At we you is diligent, can year. pandemic start flexible best right the around

this While our progress communities our strategic in and we've meeting deliverables, expectations customers critical key uncertainty while of against for all time. of remains needs made us, and the

major remain on Our projects track.

unchanged. our and remains the plan a supports And makes the Entergy in foundation that of compelling long-term capital is Our investment strength business place.

us forward, to events when through leaders the deliver cycles. value can changed commitments the stakeholders our our Recent communities on to its create sustainable not be back premier be they utility or need our resolve economic weakened at our objectives that a are stepping in time for not most. to have We

I we and way. to why The premier event to an I host still encourage of be Analyst believe Because virtual. situation it XXXX Before will Drew, we're integrated to well to recently report Utility. fluid, the be the plan what takes also you Premier outlines the The it released happy Building I'm to turn confirm we COVID-XX Day that to read report, year. over on our utility, this our continues be

later continue year, October. late for in event business to Stay to delay look conversation our the plan tuned our until strategy most grow also details. continuing you We about in likely forward the with more long-term. the to our for We to

results now I'll first Drew, well as our turn over quarter our as the who will to review outlook. call

Drew Marsh

have conditions. my quickly all COVID-XX. working by affected get who longer-term guidance inspiring, They have those many The in Thank But to highlight have Similar so extraordinary sentiment, many move review past. once for express everyone. appreciation you, challenge and teh risen of the Leo. I'd and outlook. are adapted helping to to Leo's communities includes times like efforts bottom-line and people before the the Good I so quarter changing as morning, for to our results they to again to I the that the employees Entergy. that, want to I'll then

After quarter, our first guidance adjusted affirming are outlook. we solid and EPS

of million to expect $XXX $XXX lower result COVID-XX. be We million to revenue as a

implementing of spending constructive for accounting $XXX We costs. received reductions regulatory are COVID-XX million defer orders XXXX. identified to We

same. Our capital remains the plan

Our takeaways. equity until Those remains the a do for still not strong. liquidity key are need And see we XXXX.

as Our the did orders till first solid in quarter very at quarter. late results not home begin stay were

were share per quarter As $X.XX, see a were Slide the to utility quarter positive you Slide increased utility. for can drivers on basis, at straightforward. earnings On $X.XX the Entergy higher on earnings the than see you'll XX, due primary first adjusted XXXX X

Arkansas, mild reduce Mississippi tax We a saw shared portion the quarter. positive rate was actions of was response action took to weather, had lower which apparent Texas. O&M which in early favorable as customers. in And the to with Louisiana, our was and we effects of in benefits, spending

offset the growth You'll as also share offset expenses increase count. continued which see Higher in also this. higher from rate a tax the depreciation did effective resulting other, our higher partially interest partially and

first the $X.XX compared item XXXX. and lower investments $X.XX was the Pilgrim ago. On decommissioning lower positive trust lower a EWC’s in the to decline earnings of as of primarily offsetting on and Losses due recorded O&M, were tax a was Slide shutdown impairment to XX, Partially loss revenue, reported charges quarter main year drivers.

a roughly flow. Slide were XX and power collections reduction cash higher ADIT in for return in The operating nearly increase purchase to main and million shows customers. unprotected excess million fuel drivers costs, $XXX $XX the

pension quarter contributions Unfavorable first insurance from The increase. nuclear higher nuclear benefited spending lower refunds partially also refueling the higher and and offset at weather outage EWC.

about adjusted XXXX We've $X.XX affirming talk XXXX guidance to range guidance our the our outlook. on our Now $X.XX, Slide to Slide XX, and context. EPS I'd term path XXXX I'd outlook On remains to are laid that can results some you and our better understand of you like our XXXX XX longer unchanged. our we to and out achieve give expectations. so like current

XXXX, On to and for we In a of due view Slide lower the of we develop our COVID-XX. sales unfavorable remainder the expect and advanced point the and from on to first analysis data our available experienced based extensive on be in of the with we sales impact quarter of XX, XXXX industrial customers discussions meters. commercial weather

most for theaters at guidance home industrial are of Commercial we weather movie expect sales orders shuttered these temporarily. churches and commercial assumption. full stay impacted have year. than largest X.X% to The have decline be as basis, On institutions and a restaurants, to expected the adjusted sales many are the original schools, lower the at

be lower been most sales are customers and impacted. our the and Industrial expected to X% fuel refinery have

X% Although, as to refiners country. in sales less by our region partially This about due usage residential higher offset increases the of than per orders. affected is other customer in stay-at-home have parts been

we orders improvements early mid can June. the the second in see, to then slow be through to to out as expect most stay-at-home assuming phase As quarter expect the you We year recovers. economy impacted, may start

already to Slide we or This identified million lost will in the $XXX We've will savings. mitigate affect O&M includes We'll where that of work achieve impact safety for sales. XXXX reliability. not these spending on XX, reduction

when and We are the prioritizing reducing are timing contractor filled generation vacancies and employee power expenses, consulting work, outages. and of adjusting reducing scope

times times These extraordinary are extraordinary and and extraordinary for measures. our demand customers communities,

of our these taking continue lower value are to we in to stakeholders. to drive long-term the for business for measures compensate efficiencies look this to While our all one-time sales, year anticipate for we

are few Our mechanisms further mitigate over impacts, work available regulatory last we the helps improve to us. our regulatory to and to years frameworks also efficient utilizing

features. rate formula rates have jurisdictions, These plants We and plans four five forward-looking have our of in reset three annually.

Mississippi, account in or In we've take And into and mentioned, as addition, Mississippi, for the over previous the deferral look resulting Arkansas earnings from COVID-XX. two provisions year. of orders Arkansas back Louisiana, under and the jurisdictions, Leo Texas, to have costs received from county

and Therefore, implementing make their very we payment times manageable. are for plans We're customer aware more that our difficult these help customers bills are families. new to

such In addition, accelerating as bills tools, we are in reduce the liabilities developing customer regulatory versus to new now future.

is We improved such on keep our are we're to also reliability. cognizant of the that economic communities on the impact local having stimulus capital plan benefits our and those customers and as reap track, using can COVID-XX communities, so from investments, our our working while and workforces economic

slightly to Looking economic ahead planned. are we expect XXXX previously to the some and COVID-XX sales of of to effects linger, projected be XXXX, what and we below

we and help will be mechanism O&M regulatory current necessary. will as to ready Our manage

of our remain Long-term largely expectations been a although, our commodity None key delays. supportive our few intact. canceled, in industrial have plans, industries region. forward expansion remain projects have For new spreads announced long-term growth sales, of for or

domestic base and oil supportive our world-class while COVID-XX due around And the low a the workforce, economies uncertainty flexible, economically easy-to-access communities facilities, highly global among to is recovery there future remains the and cost advantaged scale, prices, of productive feed and modern highly in markets. stock, infrastructure, most world industrial

This there of In things We COVID-XX obviously is for factors going uncertainty be a lead our their turn and of of plan us as expect impact will depth recovery out length the the would number all consider. respective to remains But they event in to forward. differently, industries. today. the

in sales help to is result would could as impacts. look improvement we offset look to and to outcomes, extent we address and processes different O&M and overtime would Near regulatory seasonality the affecting would of safety continuous the without term, timing customer possible deficiencies reliability. there term, help Longer to revenue

March this Slide and at debt capital plan. reserves, We've as including had XXst, operating success over our covers billion $X.X markets all company Our new XX, billion. the fund liquidity maturities we've operating and see on in capital can as $X.X companies. far position remains of volatility, the net liquidity, market despite issued our so you was helps year, strong, term long accessing nearly This storm

lines this of have we year. the markets at to operating provides parent addition, the million in also mature companies, credit liquidity renewed times We of debt of In still later that plan two the which upon $XXX need. bonds access of

Slide Our XX. on credit metrics outlined are

last customers debt to million $XXX excess total our and includes debt is metric is Our XX.X% unprotected effects FFO to the The the over ADITs parent of to XX XX.X%. FFO returning of debt months.

and give EWC, of the exit have XX%. to this our related been reported back Excluding debt certain would items

we with our on While term regarding above to FFO a debt their this, impacts. will We've they XX%, agencies quarter COVID-XX publicly intent to at and remain the achieving push long committed COVID-XX support impacts to our to view fourth take expressed timings offset or to XXXX. have customer conversations rating had

we do XXXX. equity a need still not Finally, see until for

that may pension. topic mind your Another is be on

March of balance incorporated balance asset and billion. our $X.X April, through pension had outlook. improved was asset to this into The XXst, As pension March is XXst our billion $X.X

extraordinary are help to As our community vital we our to customers everyone this stated, a role for and we have manage successfully play times crisis. these have and

said, best manage flexible the to to we remains, diligent, We challenges this we economy And have continue remain will and monitor are head objectives. well these impacts our as financial time, Leo and can. At path to mitigate a we although positioned to achieve on. uncertainty economic as focused

the team questions. answer available is now to Entergy And

Operator

Guggenheim from Partners. instructions] of first the from our And Pourreza [Operator question line Shahriar comes

Your please. question,

Shahriar Pourreza

a here. Just couple questions of

the to $XXX million. at point the million about this you're first out calling $XXX So thinking headwinds,

COVID costs specific reductions could And in we just the COVID these recovery, defer what follow-up. some them those how a have nature as thinking pulled we reliefs or you I impacts. how time think sort about about you should mentioned of the And one are, for Can costs. offset can being cost kind You alternate speak then them? today Are think somewhat perpetual about benefits? ongoing to of you

Drew Marsh

the I'll so cost far. So address

there's of Those things PP&E, around limited. moving masks at, that. and There's costs costs that also this things those like that buckets point associated of more them fairly So, that. costs at incident costs with are I of some and think are then associated include hand sanitizer, and looking like like of response and people we're kind things dollars cleaning with types two

We for and expect of We're range be less example and the that back over costs, than year to be to have to the in course cleaning $XX we've million PP&E of them anticipating get as incurred somewhere that year. so will the more work, there provide half we the we for more far.

incurred The other expense. and And nature related bucket of bad anything costs of costs expect incur well. to potential debt that that won't is, haven't for awhile, but is would we to-date we probably those as to we

year. magnitude $XX financial XXXX experiences incremental from the in expense bad And environment, about historically, like seen of $XX that, or XXXX, a debt of past of crisis to million $XX we've kind anywhere we've of bad of million terms seen expense. have we debt Rita, million In in that Katrina,

that, Of course hard worse this than a and to make bit sure we're that. that working mitigate we could be little

some also And make as I to how my some funds today on and future paycheck due access access remarks, of payments in Leo we're bills. and protection that to on program. mentioned to impacts try customer plans, liability have customers sure mentioned information to working to payments mitigate those trying our new regulatory accelerate the

into to of customer all low be possible plays mitigate ultimately the well. So, as bad might sure that as bills expense are what that to debt make trying as

Shahriar Pourreza

it from levers comments incremental growth quantifying question, that and versus assuming just guide in really this have you planning beyond Are to insight this sounded around very into CapEx you start growth then 'XX kind it more from The backdrop headwind. Do to you some trends. just And assumptions have today's your your confident plan. of or these 'XX see could of guys the versus customer potential cost guys protracted mean your And call pressure slightly maybe good like being How you they the 'XX? like deferrals own cuts economic you and deferred secondary internal Leo's is assumptions. become much last mitigate nature? through lower? impact I being are always do new

CapEx enough the So, have assumption or of I is you at X% X%, any just growth want your under more Do see this to disposal kind protracted. concerns guess? I leverage to around you

Drew Marsh

trends lot and and There then in then talk finish with that. will was the start I CapEx. seen about customer O&M, a with

'XX. is that. our there's uncertainty So in planning trends X% that customer Obviously, expectation associated on the right in sales what a will be we our with about outlook 'XX piece, now the below lot were of and

than working So, gone be we on, of to what might also that it's our it and about are time, running think couple us. have our if tools through and that. also get to jurisdiction we at through should are regulatory we might Once the But that. other O&M lower processes what management work years, at scenarios we something so help we out okay, have way a each same disposal should

on improvement. develop be continuous go more. we as to we manage There opportunities be we're we of to a one have, that really the a more unlike really this will, these onetime for that, but little those bit within year O&M as to is rely cost trying we’ll time continuous changes long year. levers sustainable and years The skills further our more additional mentioned that on out, to But term need items to we look that we category on a we'll want to improvement and This always lot need forward get a there's given sustainable. basis, we rely will

We matter. of and in to do for reason We it's plans there's think for or change that, us and then around any some continue If capital to currently for CapEx, communities to our for have for that nature don't longer that to perspective, regards growth make our we have our capital. from finally, to we no think might start the And growth there. capacity concerns our important lower capital it it customers sales the to all a liquidity investments. was shift those at

reliability we So there for needed that capital capital no the important would some maybe customers example, standards, NERC think be we if longer other space. transmission meet for to distribution our very in

a question. hopefully lot to nuances things answers levers there's all one but of So, of still your manage forward the going that

Leo Denault

this Leo that to we Yes, the to add levers. is while want flex . process just is accelerate for I little example, it's from kind the process same down. standpoint using of The and right up a of now, utilizing pulling last bit were we're year,

as in which were you So, the challenged the had process first be actually, was we in weather quarter. had going already we a the to by knew process quarter, begun, the headwind, because traditional first noticed

process. the So the culture to developed the those of that part the processes DNA year-on-year ones be have are company of of and as and planning kind going we same the just

capital plan generation the our being that And the or the with what I reliability a provide and think in the to the is capital as customers, that And whether level about. just on customers we And gas then in really something footprint. of And us service of technological improvement it's of been plan, continuous a well that of mentioned is about renewables major with replacing XX% improvement through all than it's new help we're fired reliability response even generation the old improvement the our capital to and that continuous were wanted we'll adding find obviously, this, going obviously, improvement to AMI out through is working XX% greater forward. we will to some I even event that jump plan. we

that extent outside administration sure The is working. of talked in opportunity we've space of So significant level. the as unemployment the of amount level it be mentioned and virus. and before, the at that the we the all a at we of addition as states, about have the customer distribution Drew is we plan customer today within this States make and United we've regulatory enhancing. that that it’d And obviously could the capital aspect and transmission step had any, the we whether of and important that to place with shifted an where take has for that are around. problem dialog been up biggest or the sit might get with But the forward example, investment in in has a moment step to position keep And people at solutions

I'm you a useful going couple think about. to you just that And might for statistics be give to of

During have eating. obviously the we that and power, power in in a otherwise that rooms we Arkansas, about wouldn't otherwise they staying had people we in been we restore restored had weekend had that Easter and over storms significant Arkansas to hotel was as wouldn't But pretty event. X,XXX have stayed eating meals

or rooms that we there. effective there. were economic employees on that whether contractors. was it’d our an meals in occurred of served because be only our There Entergy have, was just kind was is XX,XXX an hire impact only we That nights because the XX,XXX hotel there effective was that people not the So Entergy

as an we employees community that to multiplier meals are these that the serving the there's not those after. were go or about or real but our week, that significant working and usually talk week probably before into economist that. are put are effects that the something But real that we people often week like But at up quite thereby LSU

system more we to customers. service the It's of than the the improving that those reliability important So, level for is well. important the capital just our provide and plan communities as

Operator

Thank you.

Julien of America. from from Our Dumoulin-Smith next Bank the of comes question line

please. question Your

Julien Dumoulin-Smith

in starting FRPs second to a earning from first and do to annual little Just commitment then bit throw at ensure ALJ, in the really, invest rate wanted about of SERI it first time one you follow-up is states can you more you’ve the to obviously think seems I'll Twin that's the had return the and against recognizing capital. than with that had you if caps on those How the follow-up across same decision last need various last like quantify consistency questions set Goals, the one. in but off. quick of as impact filing, your historically latitude the those potential you just, I the imagine, a And the one.

Roderick West

effect, renew in Louisiana Mississippi. to might I'll will accounting Arkansas, the up. that working beyond and extent are sales FRPs perhaps And the the in are to provision. we five the Orleans, have follow We FRPs orders had are as We're and operate mentioned changes where we've sunset the start jurisdictions Louisiana seeking costs don't the FRPs those designed those designed. four have our FRPs and we New But that just we the FRPs, of Mississippi that on COVID just working of Arkansas, as many FRPs in address as In and to referenced. and forecasting. a Drew

the states forecasting. the O&M we're from perspective, the sales. efficient mechanisms us the have what and recovery puts with projected is So of an FRP each And have around relative giving incorporating takes and confidence we we in various it's

and the to It’s as working design. part certainly its renew them we’re Louisiana. making Arkansas case of So, in

are So we working well. vantage as think point, from that the FRPs

Drew Marsh

add, about just you I'll rate And the path. asked

we that is below or path rate the would for inflation. still expectation at be Our

account into XXXX about have low year, you And growth take our then to back still our it's have you and for ROEs. lead given last of been rates ADIT off we asked very that if path. the you rate bill Now, excess but a

also role putting play capital to community to we about, now in our the only an in not talking to work drive activity. economic was to have customers, but benefit of right terms Leo important As

maintain know about we with adequate in and have him conversations that. our been we've to in make that sure liquidity, do And and order regulars to we retail that that, credit

And the things we credit make and our we that do liquidity they support and are committed to also to need have sure so were to the our that required communities. customers

I some So help of will as think that the ROE well. address question

Operator

Our the from Tonet comes of from Morgan. question Jeremy next line JP

question Your please.

Jeremy Tonet

guess in start here? kind what and footprint And what start seeing customers like of kind now maybe wondering, you to just time Just off, trends larger your up. of different your of that you type from areas of of sight want are start to seeing kind that guys line your right informs guidance you to have real open see more you up, gleaned across what your jurisdictions, I from ramping certain are

Roderick West

-- The have at across segment. driven the customer in that we demand customer the experience high saw schools variability usage segment. churches, per home the earlier. in the in think to we brunt alluded of segments, the expected orders experiencing A in where alluded I Drew residential of across lot customer of theaters segments, and to, movie the stay near-term Certainly, certainly erosion. restaurants, commercial and it the as

of on we've several be paying respective experiencing sector, components as supportive time various us from in perhaps of constant customers much to such stable data AMI they erosion might. And the is those XX% that AMI economy recovers. to our day-to-day weeks relative the industrial around likely we’re in basis. last as given the comfort from point that constant communication the we're outlooks, that been that of we're aside their we're a and with industrial larger the chain they've In their data tracking is receiving in value attention demand until communication view approximately the been We've as

still the the economic and that recovery say in expected. hit uncertainly driving to the our Certainly, the and harder that around timing a that's and downturn, and segment, be out metals we and segments things those played way in tracing testing that relative that I of to some expected And get of refining the of nature. primary to of we remains ability with all

so, what engagement Texas, we've and of plays in lion differently that's Louisiana XX% engagement reinforced with seen from industrial our the certainly, data, the And the has it the and the AMI of to volatility state-to-state. base where But we're out share that really significant presence And in customers range. seeing. addition within

Jeremy Tonet

U.S. then oil prior Gulf global a you longer-term narrows as NAPTA key for curve given and the the And future spread advantage growth load picking tighter Henry to adversely competitive on like impacts Hub a feedstock competitive dynamic nat the advantage the expectations? load. spread kind gas versus across for the been cost of favorable that there. just a Brent worry of Do the been that crude determinant ethane Coast maybe last industrial petchem has and It of point, seems up for proxy spread

Drew Marsh

other expect that some where being my obviously they're continue close the healthy we was the has do we we others mentioned. So pay the out to. you we is but is ones for to return we spread, attention listed as not and historically, And see does long-term recognize as have reason one bit and not it but that our that we of economic do like It for are advantage look it a to I that very attention one industrial if are healthy basis. going off that that them been closely near-term in that's little spreads paying it change the to a to provide we customers do Gulf on challenged. Coast advantages But that you of close those monitoring well spread that forward. near-term more remarks, And as

Operator

Thank you.

Byrd from Morgan comes Stephen Our next the from question line Stanley.

Your question please.

Steven Byrd

into little have a Most go wanted addressed. just I of tax my more questions detail. been in to

think in tax color what see and a the a improvement were? I of I guess And were $X.XX give of if detail? just stock-based around the little the change you in the terms a little I net of could you I about IRS changes what around is comp. settlement explain changes in more sort guidance Could share. wonder a

Drew Marsh

through net And had is benefit the do we one years completed IRS tax That quarter. customer is main for line, while that the offset is in settlement is and backs, give the to the revenue about which that on there several securitization of a in only. ago. The with $X.XX costs tax much settlement,

annual true There why other just year, we from GAAP like stock-based difference a that's tax a each is there. whenever The vests occur ups perspective. there's true is stock that stuff true and a that's perspective, up the from compensation up no

Steven Byrd

tax the your Just being? understand longer effective an for we're rate earnings is do rate so Longer-term, trying effective year. your income you power now see properly. tax I income XX% this where And through term approximately expectation to think

Drew Marsh

range. had the to where similar around we it It's XX% previously

Operator

Thank you.

Our next Vertical from Arnold from Research line comes Jonathan the question Partners.

please. Your question,

Jonathan Arnold

liabilities that of Is still regulatory impact. this utility accelerate we be investments. some to you get XXXX a thinking quick X% XX% previously or and scale would of off But you're on that from said a XXXX? the we thought of equity have good Just if a about be maybe with some you number should question, these the going once cash re-calibrating that of to that order

Drew Marsh

that such in good the we liabilities They we careful moving discounting think are coming very We're have are we them sure economically more neutral, number. that are are either are increasing out a cash flow we that's the about to I because forward. way future. base, still rate they or that make

way should going move will financing kinds ratio, have to liabilities choices of either headroom -- better result. little a forward It's the should current impact -- the that the a there ratio year's that's of those forward. debt to some So, we be bit as FFO those headroom but going to in

Jonathan Arnold

using you bit And you're your of what as number make below inflation. can mentioned, plan then that wanting of in to inflation you longer Drew, your term share Have views a the path rate for the inflation? changed. And you is keep

Drew Marsh

We wish for We rule I that the a going what Jonathan. as really of inflation. question, $X adding excellent of what trillion we I that thumb knew know that will of inflation was be. an don't to at look benchmark do X% kind use That's for stimulus. fiscal

Jonathan Arnold

-- number down just XX or be XX Slide has what the what one I to you're and reconcile was that I shows to and for that a telling X.X% different X% basis typo Is of industrial. you that? us a year on And then is on trying think expecting sales, then I Slide industrial think just retail thing, that which the was are

Drew Marsh

original The on And were the... exact is X.X% you or different that the XX our up Slide to there’re subtract into you two with about bases. we versus you will get And remember as be I guidance. X%, X.X, recall, X%, X% to Yes, planning can't one number.

Jonathan Arnold

I got it.

and that's guidance had the the So optic it.

Operator

Thank you.

line comes Wolfe. the Our Fleishman from next of question from Steve

Your question please.

Steve Fleishman

would to was what that the impact be? And the CRE though you earlier that finalized were Just wanted ALJ. asked if be, question think about on decision re-ask don't will the it even

Drew Marsh

Steve on Julien's This for is up. thanks question. Drew. that didn't We And get picking to it quite

came lease So a and the as There's amounts The appreciate a tax we wasn't impact ruling to because is mentioned, lot are two out re-asking in provided uncertain in specifically. through the little calculation from of payments payments the is you positions and Leo that there the associated The it. with components queue, are bit details. ALJ the there. laid lease unclear,

like is, the don't impact include we there. think very you positions. about is it we close -- be bottom large if ALJ interest, looks the one refund will larger and as out, laid line tax there $XXX So the The it to uncertain the a And million. don't it's the

probably about that that there drive that and are the and also it, ALJ we ALJ's that, the or we than half that more little the believe in that And the interim down interest than, we the IRS course would even mentioned, decisions. we've number Leo of bit FERC As include position overtime. of for $XXX be offsets the put that note that might ALJ basically be. out. the And that ultimately include like less been though policy costs in the included, the wrote right a that overall impact one million what that policy have calculation to would is little to would paying of that a would is the perspectives the would financing And whatever did ruling you not of ALJ reduce

Steve Fleishman

just a ongoing impact aside that risk. one the a would other time… onetime just So any, from financing is earnings obviously be as refund, be or Would there there that any

Drew Marsh

be they deferred of our year. tax course then payments, for base not that's be a basis able in what would change the ongoing would million $XX a lease to the positions. that And continue, the an which lease onetime indicated ALJ payment Well, about the rate is wrote, on

well. we'd have as that So,

Steve Fleishman

David Borde	Vice President, Investor Relations
Leo Denault	Chairman and CEO
Drew Marsh	CFO
Roderick West	Group President, Utility Operations
Shahriar Pourreza	Guggenheim Partners
Julien Dumoulin-Smith	Bank of America
Jeremy Tonet	JP Morgan
Stephen Byrd	Morgan Stanley
Jonathan Arnold	Vertical Research Partners
Steve Fleishman	Wolfe
Michael Lapides	Goldman Sachs
Sophie Karp	KeyBanc

Entergy (ETR) 11 May 202020 Q1 Earnings call transcript