Earnings Teleconference 3rd Quarter 2017 Oct. 24, 2017 Table of - PowerPoint PPT Presentation

Earnings Teleconference 3rd Quarter 2017 Oct. 24, 2017

Table of Contents Section Slides Caution Regarding Forward-Looking Statements and Regulation G Compliance 2 Strategic Execution 3 Quarterly Results 4–7 Hurricane Harvey – Preliminary Cost Estimates 8 2017 Guidance and Longer-Term Financial Outlooks 9–11 Cash and Credit Profile 12 Looking Ahead to EEI 13 Appendix and Regulation G Reconciliations 14 Utility Overview 15 Utility Companies’ Regulatory Overview 16–27 AMI Regulatory Approval Processes 28 EWC Overview 29 EWC EPS Variance Details 30–31 EWC Nuclear Plant Updates 32–33 EWC Hedging and Price Disclosures 34–36 Estimated Special Items 37 Plan to Operate Palisades Until Spring 2022 38 Progress Against 2017 Guidance and Sensitivities 39–40 Third Quarter Earnings Summary 41 Regulation G Reconciliations 42-47 1

Caution Regarding Forward-Looking Statements and Regulation G Compliance In this presentation, and from time to time, Entergy Corporation makes certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, among other things, Entergy’s 2017 earnings guidance, its current financial and operational outlook, and statements of Entergy’s plans, beliefs or expectations included in this presentation. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this presentation. Except to the extent required by the federal securities laws, Entergy undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements are subject to a number of risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied in such forward-looking statements, including (a) those factors discussed elsewhere in this presentation and in Entergy’s most recent Annual Report on Form 10-K, any subsequent Quarterly Reports on Form 10-Q and Entergy’s other reports and filings made under the Securities Exchange Act of 1934; (b) uncertainties associated with rate proceedings, formula rate plans and other cost recovery mechanisms, including the risk that costs may not be recoverable to the extent anticipated by the utilities; (c) uncertainties associated with efforts to remediate the effects of major storms and recover related restoration costs; (d) nuclear plant relicensing, operating and regulatory costs and risks, including any changes resulting from the nuclear crisis in Japan following its catastrophic earthquake and tsunami; (e) changes in decommissioning trust fund values or earnings or in the timing or cost of decommissioning Entergy’s nuclear plant sites; (f) legislative and regulatory actions and risks and uncertainties associated with claims or litigation by or against Entergy and its subsidiaries; (g) risks and uncertainties associated with strategic transactions that Entergy or its subsidiaries may undertake, including the risk that any such transaction may not be completed as and when expected and the risk that the anticipated benefits of the transaction may not be realized; (h) effects of changes in federal, state or local laws and regulations and other governmental actions or policies, including changes in monetary, fiscal, tax, environmental or energy policies; and (i) the effects of technological changes and changes in commodity markets, capital markets or economic conditions, during the periods covered by the forward-looking statements. This presentation includes the non-GAAP financial measures of operational EPS; UP&O adjusted EPS; normalized ROE; parent debt to total debt, excluding securitization debt; operational FFO to debt, excluding securitization debt; and debt to operational adjusted EBITDA, excluding securitization debt when describing Entergy’s results of operations and financial performance. We have prepared reconciliations of these financial measures to the most directly comparable GAAP measure, which can be found in the appendix of this presentation. This presentation should be considered together with the Entergy earnings release to which this teleconference relates, which is posted on the company’s website at www.entergy.com and which contains further information on non-GAAP financial measures. 2

Strategic Execution 2017 Key Deliverables 1 (subject to change) 1Q 2Q 3Q 4Q  IPEC closure  ELL annual FRP filing  EAI FRP filing • MTEP 17 approval announcement  Palisades PPA • New Orleans Power • EAI FRP decision  NYPA trust transfer Station CCNO termination decision • EAI AMI decision decision (in process) by the Michigan PSC  Final IPEC WQC/  ELL AMI decision  ENOI renewable RFP SPDES issued • ENOI AMI decision  EMI AMI decision selection (in process)  EMI FRP filing  ETI AMI filing  FitzPatrick  ELL annual FRP  ETI TCRF decision  Montgomery County transaction close implementation  EAI and ELL Power Station PUCT  EMI FRP decision  Lake Charles Power renewable RFP decision  ETI DCRF filing Station LPSC decision selections • Annual dividend  ETI DCRF decision  IPEC CZM review  ELL FRP extension concurrence and modification  VY license transfer filing (new) filing with the NRC 3 1 Estimated timing; some subject to regulatory approvals or other requirements/factors that could lead to changes

Key Takeaways 2017 EPS Guidance; $ Third Quarter 2017 EPS Summary; $ 3Q17 3Q16 Change 6.80–7.40 ETR Consolidated As-reported 2.21 2.16 0.05 Operational 2.35 2.31 0.04 4.25–4.55 Utility, Parent & Other As-reported 1.90 2.12 (0.22) Operational 1.90 2.12 (0.22) Adjusted 2.15 1.98 0.17 EWC As-reported 0.31 0.04 0.27 Entergy UP&O Operational 0.45 0.19 0.26 Operational Adjusted 4 See slide 41 for a summary of third quarter 2017 and third quarter 2016 earnings

UP&O Third Quarter EPS Comparison UP&O Adjusted EPS; $ 0.27 0.07 (0.06) (0.11) AFUDC Volume Nuclear Depreciation NDT earnings Price Taxes other (offset in 2.15 2.08 1.98 than income net revenue) taxes 3Q16 Net revenue Utility Other Utility Utility 3Q17 (excl. non-fuel operating other 1 1 1 weather) O&M expenses income 3Q16 3Q17 Change UP&O As-Reported 2.12 1.90 (0.22) Less: Special items - - - Weather 0.18 (0.25) (0.43) Normalize tax (0.04) - 0.04 UP&O Adjusted 1.98 2.15 0.17 5 1 3Q16 DOE award affected multiple income statement line items; net quarter-over-quarter impact $(0.04)

EWC Third Quarter EPS Comparison EWC Operational EPS 1 ; $ 0.07 0.01 0.07 0.19 (0.06) NDT earnings Refueling outage 0.45 0.44 0.44 0.43 exp. (0.02) Nuc. fuel exp. 0.19 Capacity rev. 3Q16 FitzPatrick Net Non-fuel Other Decomm. Other 3Q17 revenue O&M income exp. 3Q16 3Q17 Change EWC As-Reported 0.04 0.31 0.27 Less: Special items (0.15) (0.14) 0.01 EWC Operational 0.19 0.45 0.26 6 1 Individual line items exclude the variances from the sale of FitzPatrick, which is summarized as one driver (see slide 30)

Third Quarter OCF Comparison OCF Contribution by Business 1 ; $M Consolidated OCF; $M Business Segment 3Q17 3Q16 Change Utility 878 929 (51) Parent & Other (92) (53) (39) 1,000 893 EWC 107 124 (17) Total 893 1,000 (107) Calculations may differ due to rounding 3Q17 3Q16 Primary Drivers - OCF • DOE litigation proceeds received in third quarter 2016 • Unfavorable weather Partially offset by: • Positive weather-adjusted sales growth 7 1 Intercompany income tax payments contributed to the line of business variances

Hurricane Harvey – Preliminary Cost Estimates Approximately 250,000 customers affected Preliminary Estimate 1 ; $M Current Storm O&M Recovery Mechanisms Entergy Louisiana 75–105 $5.6M annual revenue requirement; • ~$(7M) (under funded) balance as of 9/30/17 2 $284M restricted storm escrow as of • 9/30/17; storm cost of at least $0.5M required to access escrow Entergy Texas 10–15 $8.5M 3 annual revenue requirement; • ~$(11M) (under funded) balance as of ELL ETI 9/30/17 4 Note: Historically, ~60-70% of storm spend has been categorized as capital 1 Progress to date points to the lower end of our preliminary range 2 Includes $(1M) from Hurricane Harvey non-capital expenditures 8 3 $2.7M of the $8.5M is designated for past storm recovery deficit 4 Includes $(13M) from Hurricane Harvey non-capital expenditures

2017 EPS Guidance Affirmed 2017 EPS Guidance 1 ; $ 6.80–7.40 7.10 midpoint 4.25–4.55 4.40 midpoint Entergy Operational Utility, Parent & Other Adjusted Current expectations in the Current expectations in the lower end of the range top half of the range 9 9 1 Originally prepared February 2017 and Entergy operational updated August 2017

Utility, Parent & Other Financial Outlook Affirmed, added 2020E UP&O Adjusted EPS 1 ; $ 5.20–5.60 4.90–5.30 4.50–4.90 4.25–4.55 17E Guidance 18E Outlook 19E Outlook 20E Outlook 10 1 Excludes special items and assumes normal weather and income taxes

EWC Operational Adjusted EBITDA Outlook Reflects 9/30/17 market prices, Palisades operating until spring 2022 EWC Operational Adjusted EBITDA; $M 540 460 430 325 200 10 17E 18E 19E 20E 21E 22E Estimate at 530 390 290 165 0 n/a 6/30/17 11 See estimated special items on slide 37