Q2 2019 Results August 12, 2019
Forward-Looking Information and Non-GAAP Measures Forward-Looking Information This document contains “forward - looking information” and statements which reflect the current view with respect to the Company’s expectations regarding future growth, results of operations, performance, business prospects and opportunities and may not be appropriate for other purposes within the meaning of applicable Canadian securities laws. All such information and statements are made pursuant to safe harbour provisions contained in applicable securities legislation. The words “anticipates”, “believes”, “could”, “estimates”, “expec ts ”, “intends”, “may”, “plans”, “projects”, “schedule”, “should”, “budget”, “forecast”, “might”, “will”, “would”, “targets” and similar expressions are often intended to identify forward -looking information, although not all forward-looking information contains these identifying words. The forward- looking information reflects management’s current beliefs and is based on information currently available to Emera’s management and should not be read as guarantees of future events, performance or results, and will not necessarily be accurate indications of whether, or the time at which, such events, performance or results will be achieved. The forward-looking information is based on reasonable assumptions and is subject to risks, uncertainties and other factors that could cause actual results to differ materially from historical results or results anticipated by the forward-looking information. Factors that could cause results or events to differ from current expectations are discussed in the Business Overview and Outlook section of Management’s Discussion and Analysis (“MD&A”) and may also include: regulatory risk; operating and maintenance risks; changes in economic conditions; commodity price and availability risk; capital market and liquidity risk; future dividend growth; timing and costs associated with certain capital projects; the expected impacts on Emera of challenges in the global economy; estimated energy consumption rates; maintenance of adequate insurance coverage; changes in customer energy usage patterns; developments in technology that could reduce demand for electricity; weather; commodity price risk; unanticipated maintenance and other expenditures; system operating and maintenance risk; derivative financial instruments and hedging; interest rate risk; credit risk; commercial relationship risk; disruption of fuel supply; country risks; environmental risks; foreign exchange; regulatory and government decisions, including changes to environmental, financial reporting and tax legislation; risks associated with pension plan performance and funding requirements; loss of service area; risk of failure of information technology infrastructure and cybersecurity risks; market energy sales prices; labour relations; and availability of labour and management resources. Readers are cautioned not to place undue reliance on forward-looking information as actual results could differ materially from the plans, expectations, estimates or intentions and statements expressed in the forward-looking information. All forward-looking information in this document is qualified in its entirety by the above cautionary statements and, except as required by law, Emera undertakes no obligation to revise or update any forward-looking information as a result of new information, future events or otherwise. Nothing in this document should be construed as an offer or sale of securities of Emera or any other person. Non-GAAP Measures Emera uses financial measures that do not have standardized meaning under USGAAP and may not be comparable to similar measures presented by other entities. Emera calculates the non-GAAP measures by adjusting certain GAAP measures for specific items the Company believes are significant, but not reflective of underlying operations in the period. Refer to the Non-GAAP Financial Measures section of our MD&A for further discussion of these items. 2
Business Update Scott Balfour President and CEO
YEAR-TO-DATE RESULTS ON TRACK Our business is performing well and we have made significant progress on strengthening our balance sheet and reallocating capital to ▪ EMERA NEWFOUNDLAND our strongest businesses ▪ EMERA NEW & LABRADOR BRUNSWICK ▪ EMERA INC ▪ NOVA SCOTIA POWER ▪ EMERA UTILITY SERVICES $1.49 ▪ EMERA MAINE $775 ▪ EMERA ENERGY YTD adjusted YTD Cash flow (2) EPS (1) 10% ▪ NEW MEXICO GAS 1% YTD YTD cash ▪ TAMPA ELECTRIC adjusted ▪ PEOPLES GAS flow (2)(3) ▪ GRAND BAHAMA POWER EPS (1)(3) (1) Adjusted EPS is a non-GAAP measure; a reconciliation to the nearest GAAP measure can be found in the appendix ▪ DOMINICA ELECTRICITY SERVICES (2) Operating cash flow pre-working capital in millions of dollars (3) Compared to year-to- date (“YTD”) Q2 2018 ▪ BARBADOS LIGHT & POWER 4
Stable Regulatory Outlook Q1/19 Q2/19 Q3/19 Q4/19 NSP Maritime Link Application for recovery of 2020 revenues Emera Maine Transaction Filings & Hearings Nova Scotia Power Rate Stability Plan Filing New Mexico Gas Distribution Rate Case Tampa Electric SoBRA – Tranche 3 Florida Storm Protection Legislation FPSC Rulemaking - Filing - Decision Expected 5
Florida Investment Highlights Solar Big Bend Modernization Storm Protection • • • Investing $850M USD to Investing $850M to Legislation approved install 600MW of solar by repower Unit 1 with natural requiring utilities to invest in 2021 (405MW in-service gas combined cycle storm-protecting the grid • today); assessing technology and retire Unit 2 FPSC rule making expected opportunity for further early to be complete in October • investment Construction began in 2019 • Offering customers August 2019 and will be community solar through complete in 2023 Sun Select program 6
Predictable, Steadily Growing Utility Earnings Historical Adjusted EPS (1) (2) $3.02 $2.88 $2.77 $2.46 $2.26 $2.23 $1.96 $2.30 $2.13 $2.08 $1.87 $1.30 $1.14 $0.93 2013 2014 2015 2016 2017 2018 TTM Q2/19 Continuing Regulated Utilities + Corporate Consolidated Emera’s continuing regulated utilities + corporate have grown by 10% over the past 5 years compared to 8% consolidated adjusted EPS growth 7 (1) Supporting data table, including a reconciliation between continuing regulated utilities + corporate and consolidated adjusted EPS, included on the appendix (2) TTM does not reflect the earnings impact of asset sales; full year adjusted EPS is expected to be consistent with normalized 2018 results
Capital Program Drives Rate Base Growth Forecasted Rate Base (1) $21.3 $20.1 $18.7 $17.2 (2) (2) 2018A 2019F 2020F 2021F (1) Reflects rate base from continuing utility operations to better reflect the ongoing earnings power of the business. Average total rate base in billions of Canadian dollars. U.S. dollar denominated rate base is translated at the actual USD/CAD exchange rate of 1.30 in 2018 and a forecasted exchange rate of 1.30 in 2019-2021. Only approved and ordinary course capital projects are included. Details by affiliate can be found on slide 21 of the appendix. Forecast is subject to change in the normal 8 course of business. (2) Excludes Emera Maine
Strong Performance in 2019 ✓ Closed NEGG and Bayside transactions and announced Emera Maine sale for total proceeds of $2.1 billion ✓ Continued to advanced strategic initiatives , including receiving site certification and beginning construction at Big Bend and adding 280MW of new solar in Tampa ✓ Established a $600 million ATM program ✓ Retired $550 million USD of holding company debt and reduced consolidated leverage by ~200 bps ✓ Solidified investment grade credit rating with BBB rating from Fitch and a stable outlook from Moody’s ✓ Removed foreign ownership restrictions , better positioning Emera to access global capital markets 9
Financial Results Greg Blunden CFO
Growing Adjusted Earnings and EPS Adjusted Net Income Adjusted Earnings per Share $0.54 $354 $1.49 $130 $1.35 $313 $0.48 $111 +13% +10% +13% +17% 2018 2019 2018 2019 2018 2019 2018 2019 Q2 June Year-to-Date Q2 June Year-to-Date 11
Consistent Operating Cash Flow June Year-to-Date Operating Cash Flow Pre Working Capital $775 $767 +1% 2018 2019 12
Key Drivers of Q2 2019 Adjusted EPS $0.01 $0.02 $0.02 $0.08 $0.06 $0.11 $0.04 $0.54 $0.54 $0.48 $0.44 Q2 2018 Asset Normalized Florida Gas Utilities Other Other Canadian Emera Q2 2019 (1) (7) (3) (5) Sales Q2 2018 Electric and Infra. Electric Changes Electric Energy (4) (6) (2) Utility Utilities Utilities (1) Earnings impact of the sales of the NEGG portfolio and Bayside (2) Higher base revenues related to the in-service of solar generation projects, customer growth and favourable weather, partially offset by higher interest and depreciation costs (3) Primarily due to the $12 million adjustment recorded as a result of a favourable regulatory decision in New Mexico (4) Higher contributions from Emera Maine due to higher capitalized construction overheads and the absence of regulatory expenses adjustments related to the 2018 distribution rate case (5) Includes the impact of foreign exchange (+$0.02) and share dilution (-$0.01) (6) Primarily due to lower contributions from NSPI, due to timing of regulatory deferrals and increased OM&G expenses, partially offset by increased sales volume and 13 decreased income taxes (7) Lower marketing and trading margins due to less market volatility
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