FirstEnergy (FE) 22 Apr 222022 Q1 Earnings call transcript

Greetings. And welcome to the FirstEnergy Corp.

First Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. reminder, is a recorded. As Instructions] this being conference [Operator pleasure is your Investor At Corp. it my Relations to FirstEnergy President, this time, Vice now introduce Prezelj, host, for Irene Ms. you, Thank Prezelj.

begin. now may You

statements XXXX Thank expectations subject earnings various you. and statements earnings, matters. link those can could are and cause actual revenues, to strategies, to regarding indicated our based These and Investors Welcome first statements by forward-looking from of call. the these our we found uncertainties. are website that Factors will to filings. Today make prospects section other be performance, differ results risks the and quarter on under materially on SEC our Earnings in current Information

GAAP discussion financial supports Financial the year Strategic will of presentation that Highlights other the and can and the on non-GAAP the certain also be Reconciliations We discuss quarter today’s measures, and document information non-GAAP our detailed about financial in and website. section found between Investors measures.

We call with Taylor, Steve for session. Executive President and be from will Several executives begin President and will Officer; Jon Vice Senior Q&A other our available today’s Financial Strah, Chief Officer. and the our Chief presentations

over turn will Now, I to Steve. the call

everyone. morning, Irene, and joining us today. you Thanks, good Thank for

our ratio in reaffirming earnings grow our dividend of and solid with we to while reported share in of annual per to share position, about thereafter X% still and future. expect billion our I plan. is maintain optimistic that affirm we of for the our year are $X.XX to excited will of off share with X% $X.XX We share midpoint business the based to model, a performance, five-year per the XXXX operating earnings line a $X.XX the With and GAAP a continuing portfolio we guidance the earnings are I we XXXX $XX increase long-term objective transformation transition. and can are And am guidance. per per start with per investment growth strong year strong this financial momentum, approval, our our on robust in our $X.XX to customers, to dividend in of $X.XX rate XXXX. earnings focused of Today Yesterday, subject on focus and our share operating of operational board and on the company into we a a unrelenting dividend leader payout foundation from our within and This energy as base. are assets

key areas focus have meaningful changes. roadmap company making employees employees we culture a with this integrated meaningful a momentum, be working Earlier done to as help Forward these to numerous at the changes group our Over numerous at make for simpler, and this procedures three series development to updates performance narrowing sessions them our accomplished Transformation proud and level goal and have identifying Fostering this aspect feel training improving in and have long-term lot we our Embedding our of of across our of culture employees. have most a XXXX, XX of employees culture resulted am last believe years, formed culture across grateful work way a designed streamline but drive and initiatives dialogue many in every initiatives a an Culture create and safety, enhanced our steps The excellence the important implemented By over time. and the integrity, they years, for opportunities a couple lot advancement of focus employees. DE&I, better I into cross-functional the for of months. and the and our this very strong we executing their and Building our a values, of last employees done. policies to culture. where a our performance valued and we am multiple and all the the work refreshed stewardship for change impactful very few asked change employees empowered, high areas for two single they of value coordinate XXXX. open aligning year, for over what values, of with especially that of strategy. transformation I our while outcome drivers incredibly culture will From consolidate, we environment, our and opportunities FE initiatives off leaders trusting appreciative the and can to company.

enhancing are these group focus leadership team, our with and employees, small efforts We network creating discussions up meaningful and robust, around discussions two-way management facilitating our with and support supervisors in transparent employee in listening and demonstrating their hosted communicating and that of between our by accountability along and our that champion values culture me other quarterly career transformation encourage senior action supporting sessions speak sessions employees a efforts, development. members by and support to consistently more dialogue open

customer we to be customers hardships. in an recognize position residential our and prioritize well customers to deeply our the and I Winter work. employees open financial a we am open more and place as view to Taking and make a campaign out engage that our is approach By leadership results lifted our for be our who experience. areas, customer don’t month committed that more many enhanced being do focused before Changing and culture may Moratoriums a this Utility with trust team to and to alignment We enhance better our their We Last collaboration listening empower values investors. to as may efforts this, featuring customer of customers programs our raised these available including reach several to their team. employee’s bill and time, Disconnection meaningful can make help as critically customers in awareness launched better engaged of to they To more company and about facing unaware all produced also desire we jobs modeling, candor utility payment various and difficult options and our the various it assist more service our customers, produce work. personal we and important message cornerstone passionately these them. can reach a transparent times. programs and employees, might persistent customers is during They of members we striving and as and spoke are encourage of stakeholders, takes video the assistance help innovative, great for a that needs. of

and the experience, This first this help journey. effort past balances, them continued step will reducing customers bad in in to enrolled of was to are the par programs decline customers for customer show to the Virginia, that’s which levels campaign and come Utility March, XXXX a This assistance an invite we Programs, goal are contributed and first with than reach due of also in XX% increase care Ohio in is we West than of wherever funding these of quarter to year. enrolled of the more to million out the on end that Our benefiting debt. in a more risk contributions accounts, we with customers us they to on help. million $XX enhance Assistance now applied quarter At pre-pandemic to compared had those customers directly their

options on As provide enhance projects we are optimizing of better to Forward for organization focused FE designed our need initiatives, assistance. and fourth discussed numerous our self-service communications, and call, is engine for quarter customer who experiences customers our including in

of have have enhanced organization a our our it more longer through FE also improvements, their substantially out branding service enhance family payment productivity that digital a And in upgrading identify systems to make and plans beginning we payment features five data us understand the Ohio as key aligned and using we from in member our to review term those our integrating now operational significant structure maximize our will possible streamline benefits their cost and example, help easily From an new make for a perspective. the improve to to easier investments They for into today. in disconnection. and level better, decisions our customers. or can anticipate need state and efficient friend, make as for programs pay reducing high workforce consider that efficiency, model and operations for customers to recently avoid billing, to and investments, entities, website that technologies, For standpoint, we Pennsylvania processes are these collaboration, utility Forward augment we contractors Through assistance combining a a bills. financial, cost legal, productivity enroll well finally, use external

the we program, began of excellent providing service future. means prioritizing first the of end to includes distribution, of XXXX equipment. phase restoration process the Ohio, which preparing commitment customers and in system nearing automation optimize the Mod investments smart management also Grid In grid Our being also and for are in The distribution our supports the installed and outage performance. is advanced help program voltage and that meters, automate to our grid regulating

on including from customer million We the JCP&L plan and of BPU in benefits We third successful structures to improved EV Pennsylvania our over our $X.X meters and homes would of electricity businesses our The Mod incentives power installed driven to greater Across phase capital and efforts in with enhanced electric of Grid this utilities a Ohio The adoption $XXX accelerate continue usage. plan service proposed are in than investments million Jersey, meters meters we for vehicles a settlement installation to four-year than are to toward begin the the working reliability, is development complete in entire can to investments approved quarter for in about program. million charging more the into excited nearly quality includes customers, an since approval smart of investment implementation currently In provide JCP&L the In infrastructure a visibility period. these of Jersey, New with territory. their rate more smart second the designed XXXX. of XXXX, EV file installing underway $X.X smart New have footprint, support that a program our light-duty Ohio. our in XX-month throughout program. received

the FET and progress FERC making for minority issues with pending in to sale designee Board Corp. the the applications authority member interest Brookfield. and of close on the FP second to as deploy close We serve quarter to security remain proceeds Brookfield. a year and also our Sophie and Blackstone’s sale thereafter. of FET concluded. review was Brookfield stake the determined known that on And track has for there voting orders week, the a the XX.X% transaction solid yesterday the this notified are FET national complete of unresolved in issued it’s its to its We transaction were on Last of to

is lawsuit also Last including who Anderson; Reyes. on Thank Chief litigation very their resolving we to and Board to Pappas; stakeholders am to looking Luis fourth $XX.X our you and RICO recognized for make the Johnson; time, in provide refreshed Croom, Julia the the my new certainty sincere ratepayer settlement settlement Chris like a to for in members, nominees Misheff; guidance. today. quarter Mitchell; to week, grateful earnings. in Mike continue XXXX Sean Electronics. civil same I Don At reached your Kimball with future. and this for in Officer our Klimczak million. to We the am a of time We previously amount progress I’d of outstanding appreciation in expertise reserve attention outgoing I Board, Financial Tom our order for forward focus Blackstone express working Jana and the our

financial innovative, operational delivering and our execute we as a are We resilient our continue and organization. and to strategies transform more long-term industry-leading excellence into business committed company

over turn financial Jon Now I a will to for the update. call

us. good morning, and joining Steve, for Thanks, everyone. Thanks

As we this off solid year. are to a start Steve said,

Our were per of earnings $X.XX quarter earnings of $X.XX guidance. first share GAAP in midpoint of and our operating line share per the with

policy to to first recently changes, of operating compared XXXX. quarter issued approved the provided by our earnings credits impact rate Ohio increased an under per share year PUCO accounting last $X.XX and of our the stipulation customers equity, Excluding

first and year. results FE largest the several Our $X.XX quarter January $XXX retirement per being million redemption of a of note share include an in charge with Corp. the items, early this special associated

in increase mentioned I our in our were the primarily continued fourth distribution year-over-year partially and The decreased as forecast It’s other was were but to discussed higher were by operating that by plant Virginia our in higher consistent customer demand with These with and related primarily the the costs recovery our on in employee benefits, segments. driven plan. Excluding to planned change partially commercial slight business economic a costs offset operating slightly, storm business outages uncollectible West industrial offset costs expense. lower and quarter in call. items line by note and results and important expenses, the the

Our customers X.X% quarter compared saw slightly due only the for are total and we only steel in year-over-year X.X% increase quarter of as including versus automotive continues we weather residential increase pre-pandemic basis, customer work to basis Deliveries and adjusted Breaking increased to load this return levels. by distribution normal class, customers resuming X.X% and a customer industrial weather deliveries many to weather is X.X% from forecast and continued demand, decreased recovery significant in the down slowly first commercial a on Overall, XXXX increased on sales a conditions. a X.X% quarter. primarily activities. showing sectors class, XXXX, slightly off and with first first the recessionary increased to social customer of to the customer to customers our while usage adjusted which impact demand

Our industrial associated our compared below and transmission and our In and corporate program primarily higher ongoing increased remain commercial business interest of trend in deliveries X% investments investment quarter Energizing XXXX lower expense Future rate base XXXX. reflect share, per and the is in levels, segment, about growth results to quarter our first returns. the due XXXX, results X% with our our first primarily sales one-year $X.XX higher while residential to than X% about

and of year to earnings our this are our agencies earlier to ongoing guidance, met with FFO billion a operations addition sheet thereafter. $X of on work progress, our We mid-teens efforts the credit profile to billion this earnings flow FirstEnergy, balance time. the by we consistent conversation operating to reach target month meet and our over cash track improve had we $X.X rating our including targeting to good debt as improve from to In and cash about with XXXX, XX% strengthen

to As Steve the mentioned, on transaction close track in are we FET quarter. second the

said, the $X balance we program. with transaction, of Brookfield our equity from to a use to or $X.X to debt Blackstone in we As proceeds by together sheet debt-like portion billion the plan the billion fund investment obligations significant and reducing capital strengthen our

corporate will in remaining and the could million and determination the metrics capital $XXX $XXX a the on of make to January, Corp. recapitalize certain contribution, plan FE companies Corp. an structures. Later to level a deployment million, which we fund FE retire million this their after In in closes or to Brookfield operating note, reductions addition for be we retired additional debt to at credit year, transaction pension further CapEx. $XXX we used the the voluntary enhance

issuances. up a As we debt is planned light XXXX of have million the year previously, debt front, mentioned with financing on $XXX to

However, steep interest our increases have market in plan. and pension impacted rates volatility

for had nearly in XX points pension the of our pension end the a assets close for first application the loss discount while X% XX% the to basis X.XX%, quarter. or rate the plan quarter, of As to the increased

we already are to thinking through provided year, earnings to XX%, status remainder second to XXXX headwind. $X.XX This end we funded has the in we the per throughout a our equity XXXX pension interest offset in the and share XX% created $X.XX volatility but improved operating the While of the has potential guidance something rate watch guidance of per affirmed beyond. continue the from share. and for headwind quarter at expense and higher opportunities will for this potential of is Yesterday, the XXXX different markets to

consensus appreciate quarter have and challenging us. estimates with somewhat number by we of the moment to this get at the moving this work year, analysts we are your for we recognize Given pieces through period

have to our and company We are transformation employees. on we a start becoming solid off investors, plan communities an an value and industry-leading customers, to this year continue got long-term focused excellent for

interest line your and time questions. your your open FirstEnergy. appreciate will I I always, As for in the

Jeremy Thank first And Thank Instructions] JPMorgan. you. the proceed your is question. from Please our with [Operator Tonet line question you. with of

morning. Good Hi.

you? How morning, are Good Jeremy.

Thanks. Good. Good.

guess, takes point drivers as past why in of if or of would curious Pennsylvania the kind potentially what going in Just be not off, of entities gives what that with you why as this you about and Ohio any respective a forward review just happening there? well, do And is that opposed to just start bit could walk you think more and in process want process why the about to with the wondering and as through be us combining and the review spoke the on could states. I detail now your kind thought the the

thanks it’s program, very FE the already are state your model operations and, gains we have early finding are excited five for though Forward into there even that. question. in Well, Through and a efficiency we our our and aligned operating process by we

the We opportunity. a up legal to financial the entity review time very believe a the we stand consolidation, are do right thorough reviewing is and team because and of

better us access efficiencies are some for fielded our We there the could experience that functions of have a we organization that from the also potential and an what and have And see then calls in here. our had the kind potential of comprehensive last increased markets. keep would my questions to the me action project The is be right consolidation, there to mind team are several going may thought the be over to of it’s years and also of opportunity opportunities, get is they in really we And teams provide and given and the Jeremy, early, any now type through review charged stood our here. to the administrative any company assessing underway. with benefits, but it in while benefits customers up take benefits to for time we possibility a capital

view that’s it. So our really of

Got it.

out would at or think it everything in unfolds dissuade process. this kind you there So, doesn’t you point prevent about of Is that anything to as like seem there’s long the what way you as it? fair review that a as expect

Well, I ahead if once us, will to we our think, And company. progress. move and sense customers that, is we updated are our for makes and here going you will we the a team are what benefit on cost with to probably sense critical our completed makes charged and do for it with we analysis keep

for Got that. it. Thanks

-- about as hit that some that going thinking forward these accounting of changes on I are of how these pivoting set refresh want everything touch distribution us to your to changes and Just to you And walk of led through here? just process here, Is us, this should through far be the changes you could of levels impacts point you there are? we as going what kind at companies.

Jeremy. Hey, is This Yeah. John.

apologize advance week we voice. was capitalized accounting me there’s this off. let my really that based two on had for changes. But is historically have support of answer and corporate my primary First to been question, your all, in under One costs weather voice the methodology. little I a a

As point we had view. audit, went different a the of through they FERC maybe

going with And we level that And then our that FERC accounting second of get that the management to was flow that change forward. we had to historically we capitalized having corporate various veg came costs through move some P&L. all veg forward so the we audits going of around management, capitalization of the historically state through portion a the wouldn’t conclusion a and audit had program, and capitalized forward where decided

year of flow that that the that forward. plan our for into $XXX average XXXX and now on full a historically the it’s going year about P&L baked So capitalized through been is had million

Got it.

it will there. Sounds you. Thank good. leave I

Thank you.

the question Bank America. Julien next line of Please of proceed is Dumoulin-Smith question. Our from with your with

morning Good thank to Hey. the time. and you you for

how maybe fully the just think are how go, about level, So high did April the the prospects being agency rating conversations for IG? you

question. the for thanks Julien,

balance in we I what to in and our three transformation improve April had sheet. discuss continued as efforts meetings to prepared mentioned Jon his our had very remarks, good would As ongoing our characterize

of progress think and a was on that company all cases, last to what an three it’s the was clear to that our also I continue as we the and months there for track we that making plan. acknowledgement XX have executing our are me record to in plan business of executing year

focus, well-received, later the XXXX. get have to as XX% thereafter FFO-to-debt as our into times think goal no So, to we that’s many And of mid-teens the I said getting than well is as level.

anything a dialogue on and steps it’s to in a add transactions Taylor, investment know that as we I those are and And for needed to for proceeds I we us the focus quarter. have get also if two ahead. moving We think of that key taking to us for use to stated we the is on executed very grade, transformative fourth had it you important before, very Jon that don’t perhaps. have the

you Yeah. thought I the and plan. doing said our policies, things Steve, it the think, conduct a as that lot well. other of our and as I meetings financial culture around productive, code discussion well around of very we were are

As you we think on position they are us know, of we I two long our later will to It have year. plan, this I to be long And year. as to am this optimistic might execute, against year, as am a do going that be continue as later outlook. to but in as something I execute able them sometime continue that to they positive this Julien, upgrade be optimistic

quarter. They they little But bit a have us conversations different on a at a had, outlook. could do S&P, position least as the that for be they we to Now, anticipate of that in have a early outlook timeline. the as stable I maybe change an fourth have from

couple any I impact? the then What in that amount since potential even earnings I would ones mean, was what there amount just currently amount does And what jurisdiction? was that and quantify seen capitalized? change, pension, here, on you more X/XX, on the have then given that the we just can also And you it replace accounting Great. the rates can. if like moves the a Excellent. detailed look

Yeah.

our let here there’s there’s moving interest balance pension, of So the maybe just the And on as the Obviously Julien some the in lot set level well on the equity as volatility it’s about environment, on. which a last year of $XXX XX%, some of me right? group improvement is positive, by rate pieces, markets. but at the It’s metrics sheet funded side liability, status to about which credit things, a from end been million basis moved XX% in XX points. the improves

planned return, per on pension the However, losses because a had for $X.XX pension at going of or end that’s expense, share versus of the expense. us. And the the expected been headwind would least if to for pressure it market pressure put March, on some potential some about have at you

Now I a offer. couple of thoughts would

of for expense we eight pension year. go of have next terms all, to months in First setting

importantly, as debt our and FE O&M at associated headwinds Forward use able we including of have pension our But we offsets, have activities, are exist at the time and to recently looking maintenance we are already and that other be program more to voluntary is early will opportunities. is timing we well contributions the management looking financing we benefits planning, it’s plan announced many more going as as the around with So we team recover. it this to opportunities

as run our items pull business have are be is offset plan that going and So are working always we more conservatively can But articulate we is, such bottomline to that our importantly, this. we something on. transparent, that this we we wanted to Obviously, continue to to levers and monitor.

have Julien, Steve. pension this our seen would add, past. is performance I also volatility in we surrounding just

can issues have our effort We and to early past the is in it I demonstrated that about it’s year. And overcome like be ongoing headwinds. in would transparent we our add key also, that, this

we headwinds have and eight to said, see. John months defeat any team dedicated is we As will the that

throughout and So we in again, keep I proceed. will that, as am updated very you the year we once confident

All right. then… And

Yeah. I part you question. a sorry, just… could And two am Maybe Julien, had you

that will? going around was just size, if was -- I quick accounting is clarification? base, How the in moving you sorry, super on what rate Yeah. changes, to

Yeah.

So were all Julien, so… accounting changes, prospective, the

Okay.

It’s historical rate back base. to

So it change. was prospective a

I appreciate Excellent. Thank you, guys. patience. the

much, very Thank Julien. you

you. Thank

Our questions. Wolfe proceed line next question with your is of Steve with the Fleishman Please Research. from

Yeah. Great. Thanks.

sounds just pension. I think on the you my like that’s within It that growth fair? Is the X% to answered question rate. X% manageable

Yes. Yes. Absolutely.

thoughts don’t needs successful Okay. I on really And very that with $XXX thoughts million transmission have year the down. any except any -- you make asset sales? were the for obviously equity whether it the on, additional Any maybe thing. further you sense guess a might sell

So I am just there? curious any thoughts

Yeah. This Hi, Steve. John. is

again at like back are you additional would an think, equity flow was record between the and look we of connect capital valuations, of have fund need just leads competitive we capitalize on and if level right, this like to management at opportunity we in we public growth future, absolutely right there private feel if year. the our And do team, we that options the are of like dividends. plan. grade or cash did don’t going programs in our to ever Obviously, an what’s Having and difference right all So market for that, have look last we any in shareholders. to you track investment get the and said our I

any, think, guess, I after going approved? shareholder you are just a Great. got update with further Okay. settlement And the get that’s process, just I that to little on how one noisy that judge, confident

just settlement the and referring Well. the… Steve, lawsuit you derivative are to

correct. That’s

Ohio submitted On … it. I papers know, parties approval. court we stand continue to subject on the the the that will Southern XX to where agreed you a All to of for it’s and in little cases want bit got process District it. respect derivative ongoing approval everyone. to and And as a settlement, global their process the take just and March to court of I time. that’s shareholder parties

you. Thank Great. Okay.

Thanks, Steve.

of next Storozynski Seaport question comes Angie Global. proceed from the with Our your with questions. line Please

Thank you.

give you the with investigation? SEC us can update investigation, an the on going what’s on following Just on

speculate Angie. Sure, can’t The a ongoing I any really do question. cooperate we timing are fully for for are investigations as to Thanks your and now. completion on we ready that. continue right and to company

that. respect we and timetable their on somewhat are We

want I process right where of don’t far with and to So that’s we it ahead stand the really now. get too

reserve so it? And settlement you whatever or potential haven’t for provisioned, you call any that fine, no provision there’s or

noted No. it’s believe can’t I incur XX-Q this but probable we It time. -- in at -- our we reasonably that it a we estimate have that we loss, that will

then, is outage that, maintenance it the the which surprising little that’s annual plants season Is tracking mentioned the during hence me the usage bit for And Jon, plan. a Okay. it’s the when power to you is basically see for recognition expense happens O&M the It’s secondly, first power. outage cost? to of -- quarter, peak just and your the

Yeah. February, outage late in was March. The

month, being shorter I March that’s of So, kind like feel don’t all. at unusual a

Okay. you I mentioned pending is year? expect in that, think that something that filing CapEx Grid Ohio, I because then, any audits actually the Mod, regulatory guys another just And besides proceedings this this didn’t lastly, new, in there’s Ohio

time. program. that’s that -- of was would on that the X the No. there for the different started had phases always have That’s that we Angie, and intention three some ago Grid our be We something Mod Mod quite years radar Grid program

year find so file later or will something year. out probably we will this that that’s And later this

always storage, program, this types We smart meters, But of around in thoughts. work our plan with the voltage regulation. discussions kind automation, storage, will some of around parties trip been continuation X had on savers of and and of be do kind those some of battery But already pilot Mod the it of is the have programs. intervening a some utility plan. the We Grid distribution on some might

you do Okay. the the And end FFO-to-debt then one, year? the to of last this by be expect where on

perspective we and between be XX%. S&P a we somewhere over perspective and will XX% So, from Moody’s XX.X% from an will be

of proceeds, million with of we we what to where lot $XXX are do company we depend targeting. holding kind it’s the that’s going of So fund or the A out final pension on debt. the additional whether take

those bit, a but that’s So could that’s our numbers change current quite -- thinking.

you. Great. Thank

Angie. Thanks,

of with Our questions. Goldman Michael from next question Lapides the with Sachs. comes your Please proceed line

for you taking Thank my everybody. Hey, question.

ex O&M accounting in or growth us Just curious changes, can you was guidance rate embedded remind O&M savings XXXX the year-over-year? for what

Yeah.

our were for year. level base billion with we that to year accounting Last we So, operating do this if north Michael, if are just costs, little the you going number. a adjust bit year $X.X about you of -- be changes, last O&M

start prior of O&M reductions half especially year, this this see into to start FE and continue program then second on you that year the the rest you to our based as relative to year. year, following So think Forward of the the through some in will will

O&M and we year. or of the jurisdictions additional if to when it some some things gives just program. other start going this that’s some of to a reductions meaningful certain and its have flexibility of will us And things, some So, to super see second to lot and us in excited do put are that strategically where half do give that flexibility, about it we you want you type

And it. when I… Got

that… And

ahead. Go Oh!

the as was a is going the Michael. will impact just while Steve. we center are be to impact, at our even equation I Sorry, going to This customers add, be you the certain we ways ability that see lowering will on which computer even enhanced of are our keeping O&M, is in also. the experience the in And lower at same customers, systems, to service that streamline reinvestment O&M various all for time. by customer here the

So to down add step there. wanted sort I that of just

Good. Oh!

think Does O&M there, kind include the follow-up Just consolidations assumption realize I whatever when one benefit may is you in the embedded utility long-term in of the Pennsylvania? and Ohio from long-term, that did about guidance? the

side if smaller is you right? the consolidating little things benefits operating to an that’s O&M so operation, so might access to right? and right not so Because side, we the some administrative where model of on I O&M streamlined. Steve consolidation streamlining state on a as is But with have operations benefit. state benefit with associated companies the they in There some into that’s not the operating already the operating were gone the accessing main, And entities some model. this Well, private five are now, benefits and and The that public the already expensive than we the Michael, associated it’s those mean, financing the companies, mentioned, O&M bit of markets. the with benefit. legal of an necessarily debt and more of the Pennsylvania are five Ohio, be that markets the

it. Got

settlement in Jersey just what’s remind one coming to New are can then, light-vehicle program the And Okay. reach you in capital kind that of us the charging the for, regulatory finally, that? items, to trying required you of

So, it’s I of $XXX be million. south -- to going think, be we are to going

clarity going it’s think that, I to are will will hopefully, we be around be around probably working and settlement, we that $XX But, million too. somewhere have rate based. the some yeah,

appreciate it, you, Thanks, Steve. Got it. Jon. guys. Much Thank

Michael. Thank you,

from Our questions. Banerjee next of question line with Barclays. proceed [ph] your Please Sanjay with the is

couple Hi. one. Maybe the Good for of a taking Thanks morning, guys. question.

for it remind that how proceeds would that debt investment allocate pension OpCo or million of there? OpCos and mentioned Could towards the more HoldCo would secondly, just or and now, upgrade you be accelerate us towards debt, target these then, the contribution So HoldCo Moody’s you to are reduction other could And from get you one specifically the which would around used could right leaning rating? disposal prefer $XXX recapitalization. you much the Thanks.

Yeah.

to comes our primarily I a Mon to And in it West when Ohio, in and in maybe Pennsylvania that’s little West going the contributions the Ohio. but and Virginia. in So then, bit companies little companies, like said, then be Pennsylvania bit a just operating Power, in primarily Virginia, equity

So moved A now. cap that’s the we to are what over down have structures kind right of targeting lot those the years of mid-XXs.

to get XX%. to up going back are those We

where depends opportunities. environment, comes When plan. obviously, that lot the a incremental status interest it ends, on about good $XXX feel funding it the of the we of pension So capital the to million, plan rate

also had sheet, specifically, pension adjusted to sure debt make them on the our HoldCo they, we anyway debt that sense contribution enhancing is both. we to the don’t Moody’s they, I get anything conversations didn’t but credit I with focus do balance to earnings. versus counted think they is that metrics, accretive improving The out, Our take

the of obviously view we decisions, as And make or think kind one so run had we didn’t these a they are will I other. But we way things by them.

one outside Thank so of the stake, with the very the sense have with the quick looking any the that for follow-up. FET of just agencies, were you investigations of very get minority curious much. conversation there? did you SEC, of conclusion anything a sale When the they you And just else

pleased I said, just I of deploying didn’t get I matter transaction. that compliance that and our are and doing for executing plan program us a have are very around are interested like No. I things the that. very think it’s and They our sense. our stuff with that think, made. proceeds they the mean, cultural I like, from the changes And Brookfield we changes the we in

don’t being issue. I speak I But that in big don’t looking I I want them. So, was -- the that sense else to didn’t that anything conversation don’t recall just were a the for. there get they for

Okay. Thank you very much.

you Thank

Our comes questions. of Fremont Paul from Please with line with question Mizuho. the next your proceed

in we debt HoldCo the change that at funded ultimately of guidance Does five if spending potential your way with not, down Thanks. next the debt? just equity and be And will the for pay the recapitalization utilities years? any capital expect should all

that the operations our if your plus address period. the I $XX about generate program over that coming mean, will billion me have in, let there. from equity you question think five-year cash capital the well, and So, we proceeds

the capital billion. going to we We $X meantime, program In are only fund take $X.X going with are billion. debt, XX% out our to

we to invest balance going forecast $XX billion. by is over grow our to $X.X billion, debt going So period the only sheet are even though

funding include of holding that company? additional does And expected funding,

the out now $X.X the debt, holding after plan billion. will be year, the We we company a million won’t, take I right $XXX is mean, this we so

it will company holding -- will any not not we debt. So have more

are we if company fact, holding out debt will take decision that. going In that be to that make than we a more less

on for this target determined talking possible pension funding number you I Okay. And about pension then, are year? guess, funding. a Have you

voluntary. contribution. It’s It a would be voluntary

So…

the past… I in guess

don’t required. …we

It’s Is million. continue? $XXX that would been around assumption that reasonable sort of a like that

we So the make Paul, to if and contribution, is pension million proceeds, remaining a from us. transactions up the $XXX two that’s to decide totally

I pension you the out and go There’s out company so can’t a lot required it different we It debt, million. $XXX or mandatory route maybe contribution. good and be to a a voluntary be maybe million So additional a be, holding give full answer, take it’s or $XXX a we could contribution, million. could $XXX worked but fund to a not decide

it. That’s thank much. very you That’s Great. --

Thank Paul. you,

Our your is Gregg the Please Orrill with question. next of UBS. from proceed question with line

But and scenario, around earnings your thoughts your wondering of I sort downside how was adder are have RTO you in does I you. sort Thank know that affect thinking you Yeah. XX-basis-point about that. disclosed to how guidance? the of sensitivities

guidance, think material going earnings don’t Gregg. I to have impact it’s on a

the I off materially goals. sensitivity us that our think -- terms that fairly been will achieving it, have not do of clear in for and have throw we we the it track

reliability our as that adder continue We for also state continue and believe where five is for to in to out build our helpful that’s it. the system us, on appropriate it’s we and stand transmission and we improve footprint

Thank it. you. Got

you. Sure. Thank

questions time. the remarks. like are closing for this you. floor Strah over Mr. to Thank further to would turn at I There no

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conference. today’s concludes This

this time. you participation. disconnect at your may for You your Thank lines