CMS Energy Corporation

Good morning everyone and welcome to the CMS Energy 2025 first quarter results. The earnings news release issued earlier today and the presentation used in this webcast are available on CMS Energy's website in the investor relations section. This call is being recorded. After the presentation, we will conduct a question and answer session. Instructions will be provided at that time. If at any time during the conference you need to reach an operator, please press star followed by zero. Just a reminder, there will be a rebroadcast of this conference call today beginning at 12 p.m. Eastern Time running through May 1st. This presentation is also being webcast and is available on CMS Energy's website in the investor relations section. At this time, I would like to turn the call over to Mr. Jason Shaw, Treasurer and Vice President of Investor Relations.

Thank you, Harry. Good morning, everyone. and thank you for joining us today. With me are Garrick Rochelle, President and Chief Executive Officer, and Reggie Hayes, Executive Vice President and Chief Financial Officer. This presentation contains forward-looking statements, which are subject to risks and uncertainties. Please refer to our SEC filings for more information regarding the risks and other factors that could cause our actual results to differ materially. This presentation also includes non gap measures, reconciliations of these measures to the most directly comparable gap measures are included in the appendix and posted on our website. And now I'll turn the call over to Garrett.

Thank you, Jason. And thank you everyone for joining us today. CMS energy, consistent, predictable, dependable 22 years of steady hands at the wheel. It's what you expect, and it's what we deliver, and even more important in these times of broader economic uncertainty. It starts with our investment thesis, which is based on conservative planning paired with disciplined execution, a commitment to excellence across our electric and gas businesses, constructive legislation and regulation, and driving growth across the state with a robust economic development pipeline. Our customers can count on us to deliver safe, reliable, affordable, clean, and equitable energy under all conditions, and our investment thesis is what keeps us on track. It's our focus. It's what you count on us for every year. In fact, I'd like to take a moment to shine a spotlight on our recent storm response. which included company crews, dispatchers, call centers, coworkers, contractors, and volunteers who were committed to delivering excellence for our customers during the recent historic storms that impacted Michigan in late March and early April. These storms packed it all in. 14 tornadoes, nearly 100 mile-per-hour winds, and in northern locations, over 1.5 inches of ice. the team executed well. We were prepared and ready to dispatch prior to the first wave of weather with 500 crews pre-staged and 900 total crews dispatched. Fighting storms on two fronts, we restored customers safely and quickly, then continued to serve, supporting local co-op utility customers in their restoration efforts. We saw favorable customer and positive policymaker support because of our response. Yes, our investments and process changes are making a difference. I'm extremely proud and thankful for our coworkers and how they showed up in the work they do daily to improve performance for our customers. I want to start today with Michigan's constructive regulatory environment. We are pleased with the recent electric rate order in March Approximately 65% of the revised ask, nearly double the investments included in the investment recovery mechanism, and solid support for investments to improve electric reliability for our customers. We work hard to ensure our filings are transparent and high quality, and we are seeing the results, achieving constructive regulatory outcomes time and time again. We'll continue to work closely with MPSC staff, interveners, and the Commission on the importance of our investments to bolster our electric and gas systems to ensure we continue to serve customers during sunny days and extreme weather. Given our continued focus on improving electric reliability, you can expect us to file our next electric rate case in Q2. In our gas rate case, we did recently see staff testimony which we view as a constructive starting position. As we've shown in the past, we're always open to settlement, having settled our last four gas cases. The dynamics of these gas cases are different than our electric cases, and we feel good either way, a settlement or fully adjudicated order. For our longer-term filings, we expect an order in our renewable energy plan, or REP, by mid-September. our rep will help define our clean energy future and feeds into our integrated resource plan or irp that we'll file next year earlier in my prepared remarks i referenced broader economic uncertainty as you would expect we are closely monitoring the landscape potential changes shaping as needed and preparing to adjust as necessary Our conservative planning and strong fundamentals, as well as our track record of delivering through any event, gives me confidence that we are well positioned to effectively navigate any scenario. This confidence is further bolstered by our diversified service territory with minimal exposure to the auto industry or any other large sectors. We're actively monitoring the landscape and have a diverse supply chain, which limits our exposure to tariffs. Our direct and indirect spend is approximately 90% domestically sourced, and we continue to shift U.S.-based vendors to lower our exposure. Much of the exposure is related to capital equipment, which means any customer impact would be spread over the life of the asset, and our earnings are largely insulated. Nonetheless, we're actively working with all suppliers to manage fluctuations in price and sourcing to keep customer bills affordable as we execute on our plan. In the context of the Inflation Reduction Act, or IRA, we've seen good support from Republicans in our individual conversations, including the 25 who have signed on in support of continuing tax credits. Our read is that there may be a partial repeal of portions of the IRA, and although we do not expect changes to the renewable tax credits, we continue to save harbor equipment for projects within our five-year plan. And as a reminder, we have a supportive energy law in Michigan that mandates renewables and 100% clean energy resources by 2040. The law shapes our customer investments through our REP and IRP. To the degree there are changes in the IRA, Michigan's law offers us enough flexibility to achieve the intent of the law and ensure resource adequacy and affordability for our customers. As for industry exposure, I'll remind you the auto industry is about 2% of our total gross margin. The heart of our electric service territory is in the Grand Rapids metropolitan area. which is diversified with commercial businesses and manufacturing and includes significant jobs and state investment. We're also seeing expansion in other industries, including defense, aerospace, palisilicon, semiconductors, and agriculture. At CMS Energy, our core business is to serve under all conditions. Our mindset of preparedness and conservative planning ensures we are ready for multiple scenarios. Calm in the storm and steady at the wheel. I want to talk for a moment about Michigan's exciting growth renaissance and our work to help our service territory in the state thrive and prosper. First and foremost, we see strong progress in the continued construction and work to make up the 2-3% low growth within our five-year financial plan. We have seen one large data center project accelerate their load ramp up by almost a year, and another large new manufacturing project has requested to expand service by an additional 10%. All positive indicators. Both we can deliver. Since the beginning of the year, with the elimination of the sales and use taxes for data centers, our pipeline has grown to 9 gigawatts. With more of that shift, about 65% toward data centers. We're seeing the data center pipeline continue to progress and feel confident some of these projects will materialize into contractual agreements. The data center tariff, which we filed in February with the commission, is the next logical step in that process. The tariff provides a great opportunity for data centers and protects our existing customers. We'll continue to work through this proceeding with settlement being a possible outcome. As I've shared before, we are also excited about the manufacturing growth in our pipeline that brings with it secondary and tertiary benefits, including new and growing commercial business as well as residential load. We're excited about and committed to Michigan's future, and we are prepared to serve its growing energy needs. Now on to the financials for the quarter. In the first quarter, we reported adjusted earnings per share of $1.02. We remain confident in this year's guidance and long-term outlook and are reaffirming all our financial objectives. Our full year guidance remains at $3.54 to $3.60 per share with continued confidence toward the high end. Longer term, we continue to guide toward the high end of our adjusted EPS growth range of 6% to 8%. With that, I'll hand the call over to Reggie.