Duke Energy Corporation (Holding Company)

Hello all and welcome to the Duke Energy fourth quarter and end year 2023 earnings call. My name is Lydia and I'll be your operator today. If you'd like to ask a question during the Q&A, you can do so by pressing star followed by one on your telephone keypad. I'll now hand you over to Abby Motzinger, Vice President of Investor Relations, to begin.

Thank you, Lydia, and good morning, everyone. Welcome to Duke Energy's fourth quarter 2023 earnings review and business update. Leading our call today is Lynn Good, Chair, President, and CEO, along with Brian Savoy, Executive Vice President and CFO. Today's discussion will include the use of non-GAAP financial measures and forward-looking information. Actual results may differ from forward-looking statements due to factors disclosed in today's materials and in Duke Energy's SEC filings. The appendix of today's presentation includes supplemental information, along with a reconciliation of non gap financial measures with that, let me turn the call over to Lynn.

Abby Thank you and good morning everyone today we announced 2023 adjusted earnings for share of $5 and 56 cents finishing the year within our guidance range. and demonstrating once again our ability to exercise agility and managing our business and meeting our commitments. We also announced 2024 guidance of 585 to 610 with a midpoint of 598. This represents 6% growth from our original 2023 guidance. And we extended our 5% to 7% EPS growth rate through 2028 off the midpoint of our 2024 range. We entered the year with significant momentum. 2024 marks a fundamental repositioning of our investment proposition. With a commercial renewable sale, we've transformed our business. to become a fully regulated utility for the first time in decades. Along with improved regulatory constructs, we're poised to deliver on our simplified, 100% regulated growth plan. Our Southeast and Midwest utilities operate in some of the fastest growing and most attractive jurisdictions across the U.S. We expect growth in our service territories to accelerate as we move further into the energy transition driving substantial investment. We are now projecting $73 billion in capex over the next five years, an $8 billion increase versus our previous plan. Turning to slide five, 2023 marked another year of outstanding accomplishments across our business, building on our compelling growth story as we move into 24. As I mentioned, we completed our portfolio repositioning and delivered multiple constructive regulatory outcomes while maintaining our commitment to safety and customers. We executed five rate cases, and I'm proud of the constructive results the teams delivered. We received orders approving $45 billion in historic and future rate-based investments that will provide growth to customers for years to come. There was also recognition of the rising cost of capital with improving ROEs and equity ratios. And in North Carolina, we implemented forward-looking multi-year rate plans for the first time ever. The performance-based regulations authorized by HB 951 provide certainty, predictability, and value to customers and the company. This milestone was accomplished through years of work with policymakers, legislators, and other stakeholders. Shifting to operations, our teams performed well throughout the year, serving our customers in extreme weather conditions and restoring power following historic storms in Indiana and Florida. Providing safe, reliable power in all seasons and circumstances remains our mission. In fact, in 2023, Duke Energy Florida had its best reliability performance in more than a decade, largely due to our significant storm protection plan investments. These investments also aided restoration efforts in Hurricane Adalia, saving outage minutes and speeding return to service. In the Carolinas, our nuclear fleet continues to generate safe, reliable, carbon-free power, achieving a capacity factor of 96%, the 25th year in a row above 90%. And underpinning all of this and a hallmark of our commitment to operational excellence, 2023 marked our best safety performance in company history, as measured by a total incident case rate of 0.31. Safety is a core value at Duke Energy, and I'm proud of our employees' commitment to event-free operations. Finally, the Piedmont team continues to excel in customer service. For the second year in a row, J.D. Power ranked Piedmont number one in residential customer satisfaction for natural gas services in the southeast. And our Carolinas electric utilities continue to achieve strong results as well, remaining in the top quartile. Moving to slide six, we start the year entering the next phase of our energy transition, a period of execution and record infrastructure build to meet the evolving energy needs of our customers and communities. We're working with stakeholders to develop resource plans to support the phenomenal growth in our communities. In the Carolinas, demand is already outpacing the forecast used in our August resource plan filings, and we filed supplemental portfolios in January. We're committed to meeting this growth with a diverse and increasingly clean energy mix that includes renewables, natural gas, next generation nuclear and storage resources, as well as energy efficiency and demand response tools. We're also taking steps to build new generation. In North Carolina, we'll file CPCNs for over two gigawatts of new natural gas generation in 24. We'll continue to advance annual solar procurements targeting one gigawatt per year. And in Indiana, we'll file CPCNs for new generation resources around mid-year. These new facilities will add to our diverse mix of resources and are critical to meeting growing customer demand as we reliably exit coal by 2035. From a regulatory perspective, we've announced two rate cases in 2024, starting with DEC South Carolina in early January. Since the last case in 2018, we've invested more than $1.5 billion in to improve reliability and resiliency and meet the growing energy needs of our more than 650,000 customers. And in Florida, we notified the Commission of our intent to file a rate case in April. Similar to our current multi-year rate plan, which runs through 2024, this filing will cover three years of investments beginning in 2025. Our plan will add over 1,000 megawatts of new solar, and include over $3 billion of grid investments to serve population growth, increase reliability, and reduce storm-related outages. Finally, since our last rate cases at Duke Energy Indiana and Piedmont, North Carolina, we've continued to make investments to strengthen our system, and we're evaluating the timing of our next filings in these jurisdictions. In closing, I'll move to slide seven, which depicts the transition of Duke Energy over the last many years to the premier regulated utility that it is today. The strategic and financial clarity provided by optimizing our portfolio over the last decade has simplified Duke Energy to a powerful, core regulated business operating in vibrant jurisdictions, growing through population migration and strong commercial and industrial economic development. Our growth potential is the highest it's been in decades and is reflected in our $73 billion capital plan. This plan is driven by grid investments to transform the largest T&D system in the US and IRP-related generation investments to support our growing jurisdictions and fleet transition. And efficient recovery mechanisms allow us to translate these investments into customer and investor value. In closing, we have positioned Duke for long-term value creation. and our path forward is clear as we navigate the coming decade of record infrastructure build. This pivotal point in our history drives a differentiated, low risk, total return proposition going forward, and I'm confident we will deliver. With that, let me turn the call over to Brian.