Core Points - CenterPoint Energy is accelerating hiring efforts to recruit 200 new lineworkers by the end of 2025 and nearly 800 by 2030 to support local energy demands and infrastructure investments [1][3] - The company is investing over $53 billion in local energy projects as part of its 10-year capital expenditure plan, which aims to enhance the resiliency of the coastal grid [1][2] - The local demand for electric workers in the Greater Houston area is projected to exceed 11,000 workers over the next five years, with energy demand expected to increase by nearly 50% by 2031 [3] Workforce Development Initiatives - CenterPoint is launching the Energy Expressway™ program, a free multi-week training initiative designed to equip participants with technical and customer service skills for careers in the energy industry [4] - The inaugural class of the Energy Expressway™ program will begin in October, with 35 applicants selected to support apprentice and journey lineworkers [4] - The workforce expansion is critical for implementing the 2026-2028 Systemwide Resiliency Plan, which aims to reduce outages for customers by nearly 1 billion minutes by 2029 [3] Company Overview - CenterPoint Energy, Inc. serves approximately 7 million metered customers across multiple states, including Texas, and has approximately $44 billion in assets as of June 30, 2025 [6] - The company has a long history of over 150 years in providing electric and natural gas services and employs around 8,300 individuals [6]

Core Insights - CenterPoint Energy, Inc. reported second-quarter 2025 adjusted earnings of 29 cents per share, missing the Zacks Consensus Estimate of 34 cents by 14.7% and declining 19.4% from the previous year's figure of 36 cents [1][9] - The decline in earnings was attributed to unfavorable timing of recoveries from interim capital mechanisms, increased financing costs, and higher operating and maintenance expenses [1][9] Revenue Performance - CenterPoint Energy generated revenues of $1.94 billion, slightly exceeding the Zacks Consensus Estimate and representing a 2% increase from the year-ago quarter's revenue of $1.91 billion [3] Operational Results - Total expenses for the second quarter increased by 6.2% year over year to $1.53 billion [4] - The company reported an operating income of $417 million, down from $467 million in the prior year [4] - Interest expenses and other finance charges totaled $191 million, a decrease of 9.9% from $212 million recorded in the previous year [4] Financial Condition - As of June 30, 2025, CenterPoint Energy had cash and cash equivalents of $93 million, up from $24 million as of December 31, 2024 [5] - The total long-term debt was $20.56 billion, slightly increasing from $20.40 billion as of December 31, 2024 [5] - Net cash flow from operating activities was $0.97 billion, down from $1.11 billion in the year-ago period [5] Capital Expenditure - Total capital expenditure reached $2.17 billion as of June 30, 2025, compared to $1.66 billion in the prior year [6] 2025 Guidance - CenterPoint Energy reaffirmed its 2025 earnings guidance, expecting adjusted earnings per share in the range of $1.74-$1.76, aligning with the Zacks Consensus Estimate of $1.75 per share [7][9]

Financial Data and Key Metrics Changes - The company reported diluted earnings per share (EPS) of $0.30 on a GAAP basis and $0.29 on a non-GAAP basis for Q2 2025, compared to $0.36 in Q2 2024 [25][4][7] - The non-GAAP EPS results for Q2 2025 reflect a 19% decrease year-over-year, primarily due to the timing of capital recovery mechanisms [25][26] - The company reaffirmed its 2025 non-GAAP EPS guidance range of $1.74 to $1.76, indicating an 8% growth at the midpoint from the 2024 non-GAAP EPS of $1.62 [9][42] Business Line Data and Key Metrics Changes - The Houston Electric Service territory is experiencing strong load growth, with a forecasted peak load increase of 10 gigawatts by 2031, representing nearly a 50% increase in peak demand [10][11] - Year-over-year sales trends show an 8% increase in weather-normalized commercial and industrial sales for the first half of 2025 compared to the same period in 2024 [11] Market Data and Key Metrics Changes - The load interconnection queue has grown by 6 gigawatts, or more than 12%, since the first quarter call, driven by diverse economic activities including data centers and advanced manufacturing [10][11] - The company anticipates a significant increase in capital expenditures, with a total capital investment plan now at $53 billion through 2030, reflecting a $5.5 billion increase this year [21][35] Company Strategy and Development Direction - The company plans to focus more on Texas jurisdictions, with the proposed sale of its Ohio gas business aimed at reallocating nearly $1 billion of capital expenditures to support Texas operations [13][14] - The company is committed to enhancing its electric transmission system to accommodate forecasted load growth and has identified approximately 200 projects to execute over the next ten years [18][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth prospects, citing strong economic drivers in the Houston Electric Service territory and a favorable regulatory environment [10][12] - The company expects to improve its operating cash flow, which will help fund capital investments without the need for additional common equity [41][42] Other Important Information - The company has made significant progress in regulatory filings, including a proposed settlement in its Ohio gas rate case and a distribution system resiliency investment plan totaling $3.2 billion over the next three years [30][29] - The company is exploring efficient financing options to support its growth, including the proposed sale of its Ohio gas LDC and forward sales of common equity [37][39] Q&A Session Summary Question: Timeline and expectations for the Barrow cost recovery proceeding - Management is on track with mediated sessions and hearings scheduled for next Thursday, aiming for a potential settlement framework [51][52] Question: Details on the six gigawatts load growth - Approximately two-thirds of the increase relates to data center activity, with demand expected for interconnections in late 2026 to 2028 [53][54] Question: Duration of the drag from mobile generation assets - The drag is expected to last until late 2026 or early 2027, after which these assets will become a tailwind for the company [56] Question: Capital investment plan and equity funding - The company anticipates an upward bias in capital expenditures without the need for additional common equity, with a focus on long-term growth [62][66] Question: Update on the gas LDC sale process - The company aims to announce progress on the sale by the end of the year, with a closing expected about a year later [92][93] Question: Opportunities in data centers in Indiana - The company continues to have productive discussions regarding new data center demand in Indiana, leveraging its excess capacity [94][95]

Financial Data and Key Metrics Changes - The company reported diluted earnings per share (EPS) of $0.30 on a GAAP basis and $0.29 on a non-GAAP basis for Q2 2025, compared to $0.36 in Q2 2024, indicating a decline in non-GAAP EPS year-over-year [23][6][41] - The company reaffirmed its 2025 non-GAAP EPS guidance range of $1.74 to $1.76, representing an 8% growth at the midpoint from the 2024 non-GAAP EPS of $1.62 [7][41] - The company is approximately 46% of the way to the midpoint of its full-year earnings guidance range for 2025 [6] Business Line Data and Key Metrics Changes - The Houston Electric Service territory is experiencing strong load growth, with a forecasted peak load increase of 10 gigawatts by 2031, representing nearly a 50% increase in peak demand [8][10] - Year-over-year sales trends show an 8% increase in weather-normalized commercial and industrial sales for the first half of 2025 compared to the same period in 2024 [10] Market Data and Key Metrics Changes - The load interconnection queue has grown by 6 gigawatts, or more than 12%, since the first quarter call, driven by diverse economic activities including data centers and advanced manufacturing [9][10] - The company anticipates that the sale of its Ohio gas business will allow for the reprioritization of nearly $1 billion in capital expenditures to support Texas jurisdictions [13] Company Strategy and Development Direction - The company announced a $500 million increase to its capital investment plan for 2025, bringing the total capital investment plan to $5.5 billion for the year, which will be funded without issuing additional common equity [6][15] - The strategic focus is shifting more towards Texas, with the expectation that Texas will constitute over 70% of the company's portfolio after the sale of the Ohio gas business [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth prospects, citing strong economic drivers in the Houston Electric Service territory and the need for significant investments in the electric transmission system [11][20] - The company expects to see a 5% improvement in operating cash flow beginning next year, which will help fund capital investments [39] Other Important Information - The company has identified approximately 200 projects to execute over the next ten years to support the anticipated load growth [16] - The proposed settlement in the Ohio gas rate case includes a revenue requirement increase of $59.6 million [28] Q&A Session Summary Question: Timeline and expectations for the Barrow cost recovery proceeding - Management is on track and had mediated sessions to seek a potential settlement framework, with hearings scheduled for next Thursday [50] Question: Details on the six gigawatts load growth - Approximately two-thirds of the increase relates to data center activity, with demand expected for interconnections in late 2026 to 2028 [52] Question: Duration of drag from mobile generation assets - The drag in earnings is expected to last until late 2026 or early 2027, after which these assets will become a tailwind for the company [55] Question: Capital investment plan and equity funding - Management indicated an upward bias towards capital expenditures through the remainder of the decade, with potential for funding without additional common equity [61][65] Question: Update on the Ohio gas LDC sale process - The company aims to announce progress towards the end of the calendar year, with a closing expected about a year later [91] Question: Impact of SB six on interconnection interest - There has been no change in the velocity of interconnection requests despite questions around cost allocation [74] Question: Houston revitalization project alignment with city efforts - The project involves burying the interstate system around downtown Houston, allowing for significant redevelopment opportunities [76] Question: Magnitude of future capital increases without equity - Management indicated flexibility in capital spending, with potential for increases beyond the $500 million announced [86]

Core Viewpoint - CenterPoint Energy (CNP) reported quarterly earnings of $0.29 per share, missing the Zacks Consensus Estimate of $0.34 per share, and down from $0.36 per share a year ago, indicating an earnings surprise of -14.71% [1][2] Financial Performance - The company posted revenues of $1.94 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.27%, compared to $1.91 billion in the same quarter last year [2] - Over the last four quarters, CenterPoint has not surpassed consensus EPS estimates, but has topped consensus revenue estimates two times [2] Stock Performance - CenterPoint shares have increased approximately 17% since the beginning of the year, outperforming the S&P 500's gain of 8.1% [3] Future Outlook - The current consensus EPS estimate for the upcoming quarter is $0.40 on revenues of $1.94 billion, and for the current fiscal year, it is $1.75 on revenues of $9.12 billion [7] - The Zacks Industry Rank for Utility - Electric Power is in the top 34% of over 250 Zacks industries, indicating a favorable outlook for the industry [8] Estimate Revisions - Prior to the earnings release, the estimate revisions trend for CenterPoint was favorable, resulting in a Zacks Rank 2 (Buy) for the stock, suggesting expected outperformance in the near future [6]

Financial Performance & Guidance - CenterPoint Energy delivered $029 non-GAAP EPS for the second quarter[11] - The company reaffirmed its 2025 non-GAAP EPS guidance target range of $174 - $176, which at the midpoint, would represent 8% growth from 2024[10, 11] - The company is targeting top quartile non-GAAP EPS annual growth of 8% in 2025 and dividend per share growth in line with non-GAAP EPS[10] - CenterPoint Energy is targeting sustainable non-GAAP EPS and dividend per share growth at the mid-to-high end of 6 - 8% annually through 2030[10] - The company delivered 141% TTM 2Q 2025 FFO/Debt[11] Capital Investment & Strategic Initiatives - The company increased its 10-year capital investment plan by $55 billion since FYE 2024[11, 20] - The company plans to efficiently fund its robust capital investment plan through asset recycling, securitization proceeds, and $275 billion of equity or equity-like proceeds through 2030[10] - CenterPoint Energy announced a process to sell its Ohio Gas LDC and derisked '26 & '27 equity needs through forward sales of common equity of approximately $165 million under ATM & $920 million Equity forward sale[11, 12] - The company's May Storms Financing Order was approved, and the Hurricane Beryl filing is in mediation[11] Resiliency & Reliability - The company is undertaking resiliency capital investments & activities of approximately $32 billion from 2026 through 2028[16] - The company expects a 30% strengthening of overall resiliency, savings of approximately $25 million per year in storm-related distribution costs, reductions in outages by over 900 million minutes into 2029, and avoidance of over 500K outages during a Beryl-like storm[17]

[Q2 2025 Investor Update Overview](index=1&type=section&id=Q2%202025%20Investor%20Update%20Overview) This section provides an overview of Q2 2025 performance, strategic objectives, and key financial highlights, including non-GAAP metrics and cautionary statements [Cautionary Statement and Disclaimers](index=2&type=section&id=Cautionary%20Statement%20and%20Disclaimers) This report contains forward-looking statements with inherent risks and uncertainties that may cause actual results to differ materially from expectations, with no obligation for updates - Forward-looking statements in this report involve predictions of future events and financial performance, carrying inherent risks and uncertainties that may cause actual results to differ materially from expectations[3](index=3&type=chunk)[4](index=4&type=chunk) - The company undertakes no obligation to update these statements[4](index=4&type=chunk) [Use of Non-GAAP Financial Measures](index=2&type=section&id=Use%20of%20Non-GAAP%20Financial%20Measures) The company uses non-GAAP financial measures to supplement GAAP reporting, offering additional insight into core operational performance and facilitating comparisons, but not as substitutes - The company uses non-GAAP financial measures, such as non-GAAP EPS and non-GAAP FFO/Debt, to supplement GAAP financial reporting, providing additional insight into core operational performance[5](index=5&type=chunk) - Non-GAAP financial measures facilitate comparisons with historical and expected future performance but should not be considered substitutes for GAAP metrics[5](index=5&type=chunk) [Q2 2025 Highlights and Strategic Objectives](index=3&type=section&id=Q2%202025%20Highlights%20and%20Strategic%20Objectives) The company achieved **$0.29 non-GAAP EPS** in Q2 2025, reaffirmed its 2025 EPS guidance, maintained a strong balance sheet with **14.1% FFO/Debt**, and announced an Ohio gas LDC sale to fund capital investments Q2 2025 Key Updates | Strategic Objective | Q2'25 Update | | :--- | :--- | | 8% non-GAAP EPS annual growth in 2025 | Achieved non-GAAP EPS of $0.29 | | 6-8% non-GAAP EPS and dividend growth through 2030 | Reaffirmed 2025 non-GAAP EPS guidance of $1.74-$1.76 (8% midpoint growth) | | FFO/Debt target of 14%-15% through 2030 | Achieved TTM 2Q 2025 FFO/Debt of 14.1% | | Efficiently fund capital plan through asset recycling and other means | Announced sale of Ohio Gas LDC; reduced 2026 and 2027 equity needs through forward common stock sales | | Invest for growth to benefit customers and communities | 10-year capital investment plan increased by $5.5 billion since FY2024 end | | Complete Phase II of Greater Houston Resiliency Plan | Achieved full settlement agreement for System Resiliency Plan filing | [Capital Investment and Resiliency Plan](index=5&type=section&id=Capital%20Investment%20%26%20Resiliency) This section details the company's increased capital investment plan, focusing on enhanced grid resiliency, modernization efforts, and strategic project timelines [Key Resiliency Actions](index=5&type=section&id=Key%20Resiliency%20Actions) The company significantly reduced customer outage time by **50%** in H1 2024 through robust infrastructure upgrades, automation, vegetation management, and undergrounding efforts - Customer outage time decreased by approximately **50%** compared to H1 2024[9](index=9&type=chunk) Resiliency Action Progress (as of May 22, 2025) | Resiliency Action (July 2024 - June 2025) | Completed as of May 22, 2025 | June 1, 2025 Target | | :--- | :--- | :--- | | Install stronger, storm-hardened poles | 26,470 poles | 26,000 poles | | Install self-healing automation devices | 5,159 devices | 5,150 devices | | Clear hazardous vegetation near power lines | 6,018 miles | 6,000 miles | | Underground power lines | 417 miles | 400 miles | [System Resiliency Plan](index=6&type=section&id=System%20Resiliency%20Plan) The System Resiliency Plan aims to improve customer experience by accelerating investments, projecting **$25 million** in annual storm-related savings, over **900 million** minutes of outage reduction, and a **30%** overall resiliency enhancement by 2029 - Annual storm-related distribution costs are projected to save approximately **$25 million**[12](index=12&type=chunk) - Over **900 million minutes** of outage time are projected to be reduced by 2029[12](index=12&type=chunk) - Over **500,000** outages are projected to be avoided in events similar to Hurricane Beryl[12](index=12&type=chunk) - Overall resiliency is projected to be enhanced by **30%**[14](index=14&type=chunk) System Resiliency Plan Key Components | Component | Description | | :--- | :--- | | Automation Devices | 100% of circuits serving the most customers will include self-healing devices to reduce outage impact | | Undergrounding | Over 50% of the electric system will be undergrounded to enhance resiliency | | Stronger Distribution Poles | 130,000 stronger, storm-hardened poles will be installed or replaced, or existing poles reinforced | | Vegetation Management | 100% of hazardous vegetation near power lines will be cleared every three years to reduce storm-related outages | | Modernized Cables | 20,150 spans of underground cable will be modernized to reduce outage frequency and impact | [Increased Capital Plan](index=7&type=section&id=Increased%20Capital%20Plan) The company increased its 10-year capital investment plan by **$5.5 billion** to **$53 billion** since FY2024, primarily for electric transmission, grid modernization, and Texas gas infrastructure - The 10-year capital investment plan increased by **$5.5 billion** since the end of FY2024[15](index=15&type=chunk)[17](index=17&type=chunk) - The revised total capital plan amounts to **$53.0 billion**[16](index=16&type=chunk) - Key investment categories include electric transmission (increased and accelerated 345kV upgrades), resiliency and grid modernization (automation implementation, hardening/resiliency, accelerated pole replacement, feeder undergrounding), Houston downtown revitalization, and Texas gas transmission/high-pressure distribution investments[16](index=16&type=chunk) [Capital Expenditures by Segment](index=10&type=section&id=Capital%20Expenditures%20by%20Segment) Total capital expenditures for FY2025 are projected at **$5.3 billion**, up from **$4.8 billion**, with the 10-year plan reaching **$53 billion**, driven by electric transmission, resiliency, and Texas gas investments Capital Expenditure Plan by Segment | Segment | FY2024 | Q1 2025 | Q2 2025 | FY2025 Projected | 5-Year Plan ('21-'25) | 10-Year Plan ('21-'30) | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Electric | ~$2.2B | ~$1.0B | ~$0.7B | ~$3.7B | ~$14.1B | ~$37.3B | | Natural Gas | ~$1.5B | ~$0.3B | ~$0.4B | ~$1.7B | ~$7.7B | ~$15.5B | | Corporate & Other | ~$36MM | ~$12MM | ~$1MM | ~$20MM | ~$0.1B | ~$0.2B | | **Total Capital Expenditures** | **~$3.8B** | **~$1.3B** | **~$1.1B** | **~$5.3B ↑ (Prev. $4.8B)** | **~$21.8B (Prev. $21.3B)** | **~$53.0B (Prev. $48.5B)** | - The 10-year plan (2021-2030) increased by **$5.5 billion** for growth investments[26](index=26&type=chunk) [Financial Performance and Outlook](index=8&type=section&id=Financial%20Performance%20%26%20Outlook) This section analyzes Q2 2025 non-GAAP EPS drivers and outlines the company's unique 2025 earnings profile influenced by Texas rate case recovery timing [Q2 2025 Non-GAAP EPS Primary Drivers](index=8&type=section&id=Q2%202025%20Non-GAAP%20EPS%20Primary%20Drivers) Q2 2025 non-GAAP EPS was **$0.29**, down from **$0.36** in Q2 2024, primarily due to increased depreciation, equity dilution, and interest expense, partially offset by rate recovery and usage growth Q2 2025 vs Q2 2024 Non-GAAP EPS Comparison | Metric | Q2 2024 Non-GAAP EPS | Change Drivers | Q2 2025 Non-GAAP EPS | | :--- | :--- | :--- | :--- | | **Non-GAAP EPS** | **$0.36** | | **$0.29** | | | **Growth & Rate Recovery** | | | | | Electric | ▲ $0.01 | | | | Natural Gas | ▲ $0.02 | | | | **Weather/Usage** | | | | | Electric | ▲ $0.01 | | | | **Other** | | | | | Depreciation & Other Taxes | ▼ $0.04 | | | | Equity Dilution | ▼ $0.01 | | | | Interest Expense | ▼ $0.03 | | | | Other | ▼ $0.01 | | [2025 Non-GAAP Earnings Profile](index=9&type=section&id=2025%20Non-GAAP%20Earnings%20Profile) The 2025 earnings profile differs from prior years due to the timing of Texas investment recovery post-rate case, with H1 earnings representing approximately **46%** of the full-year forecast - The 2025 earnings profile will differ from previous years, primarily influenced by the timing of Texas investment recovery following rate cases[21](index=21&type=chunk) 2025 Non-GAAP Earnings Profile Comparison | Metric | Non-Rate Case Profile | 2025 Projection | | :--- | :--- | :--- | | 1H Earnings Percentage | 40% - 50% | ~46% | | 2H Earnings Percentage | 50% - 60% | 50% - 60% | | 2025 Midpoint Non-GAAP EPS | $1.75 | $1.75 | | 1H 2025 Cumulative Non-GAAP EPS | ~$0.70 | $0.81 | [Credit and Balance Sheet Strength](index=11&type=section&id=Credit%20and%20Balance%20Sheet%20Strength) This section assesses the company's credit profile, FFO to debt ratios, upcoming debt maturities, and liquidity position, emphasizing commitment to investment-grade ratings [Consolidated FFO To Debt](index=11&type=section&id=Consolidated%20FFO%20To%20Debt) The company maintains a strong credit profile with a Moody's-adjusted FFO/Debt ratio of **14.1%** as of Q2 2025, aligning with its **14%-15%** long-term target Consolidated FFO to Debt Ratio | Metric | FY2024 | Q2 2025 TTM | | :--- | :--- | :--- | | Moody's | 9.7% | 9.8% | | Adjusted for One-Time Items - Moody's Methodology | 13.6% | 14.1% | | S&P | 12.0% | 11.6% | | Adjusted for One-Time Items - S&P Methodology | 12.9% | 12.5% | - The company targets a long-term FFO/Debt ratio of **14%-15%** by 2030, calculated using Moody's methodology[33](index=33&type=chunk) [Upcoming Maturities & Debt Ratings](index=11&type=section&id=Upcoming%20Maturities%20%26%20Debt%20Ratings) The company faces **$541 million** in debt maturities in 2025, **$1.877 billion** in 2026, and **$326 million** in 2027, while maintaining investment-grade credit ratings for key entities Upcoming Debt Maturities (Millions of USD) | Company | 2025 | 2026 | 2027 | | :--- | :--- | :--- | :--- | | CNP (Parent) | | $517MM (Senior Notes) | | | | | $1,000MM (Convertible Senior Notes) | | | CEHE | | $300MM (General Mortgage Bonds) | $300MM (General Mortgage Bonds) | | | $500MM (Floating Rate Term Loan) | | | | CERC | | $60MM (Private Notes) | | | IGC | | | $26MM (Senior Notes) | | SIGECO | $41MM (First Mortgage Bonds) | | | | **Total** | **$541MM** | **$1,877MM** | **$326MM** | Company Debt Ratings | Entity | Moody's | S&P | Fitch | | :--- | :--- | :--- | :--- | | CenterPoint Energy, Inc. | Baa2 (Neg) | BBB (Neg) | BBB (Stable) | | Houston Electric | A2 | A | A (neg) | | CERC | A3 | BBB+ | A- | | SIGECO | A1 | A | - | [Consolidated Liquidity](index=11&type=section&id=Consolidated%20Liquidity) The company possesses approximately **$2.5 billion** in total available liquidity, including credit facilities and term loans, and is pursuing securitization to enhance equity content and maintain credit ratings Consolidated Liquidity (Billions of USD) | Item | Amount | | :--- | :--- | | Credit Facility Capacity | $4.0B | | CEHE Term Loan (18-month) | $0.5B | | Less: Outstanding Borrowings | ~($2.0B) | | **Total Available Liquidity** | **~$2.5B** | - The company is committed to maintaining current credit ratings and plans to introduce credit-supportive, higher equity content instruments[32](index=32&type=chunk) - The company is advancing securitization, expecting to receive approximately **$1.7 billion** from two filings in Q3 and Q4 2025[32](index=32&type=chunk)[33](index=33&type=chunk) [Regulatory Landscape](index=4&type=section&id=Regulatory%20Landscape) This section provides an overview of the company's rate case outcomes, capital recovery mechanisms, and regulatory filing updates across various jurisdictions [Rate Case Snapshot](index=4&type=section&id=Rate%20Case%20Snapshot) Final orders have been issued for rate cases in Indiana Electric, Houston Electric, Minnesota Gas, and Texas Gas, with a proposed settlement in Ohio Gas, reflecting varied rate adjustments and approved ROE/equity layers Rate Case Snapshot | Jurisdiction | Regulatory Outcome | Revenue Request or Impact | Equity Layer / ROE | Debt Layer / Cost of Debt | Key Dates | | :--- | :--- | :--- | :--- | :--- | :--- | | Indiana Electric | Final Order Issued | $80MM | 48.3% / 9.8% | 39.5% / 5.1% | Updated Feb 13, 2025, further update Mar 1, 2026 | | Houston Electric | Final Order Issued | ($47MM) | 43.25% / 9.65% | 56.75% / 4.3% | Updated Apr 28, 2025 | | Minnesota Gas | Final Order Issued | 2024: $60.8MM, 2025: $42.7MM | Settled ROR: 7.07% | Settled ROR: 7.07% | Issued Jun 27, 2025, updated Sep 1, 2025 | | Texas Gas | Final Order Issued | $5MM | 60.6% / 9.8% | 39.4% / 4.8% | Updated Dec 1, 2024 | | Ohio Gas | Proposed Settlement | Settled: $59.6MM, Requested: $99.5MM | Settled: 52.9% / 9.85%, Requested: 54.1% / 10.4% | Settled: 47.1% / 4.0%, Requested: 45.9% / 4.1% | | [Capital Plan & Regulatory Mechanisms](index=15&type=section&id=Capital%20Plan%20%26%20Regulatory%20Mechanisms) Over **80%** of the 10-year capital plan is recoverable through interim mechanisms, minimizing customer impact and earnings volatility, with most storm costs already recovered - Over **80%** of the 10-year capital plan is expected to be recovered through interim mechanisms[44](index=44&type=chunk) - Prudent cost recovery helps minimize customer impact and earnings volatility[44](index=44&type=chunk) - Winter storm natural gas costs are almost fully recovered, with Minnesota being the only remaining state[44](index=44&type=chunk)[45](index=45&type=chunk) Capital Recovery Mechanisms | Mechanism Type | Percentage | | :--- | :--- | | Traditional Rate Cases (incl. forward test year) | ~5% | | Interim Mechanisms (incl. CPCN required) | ~10% | | Other Interim Mechanisms | ~80% | [Regulatory Schedule & Activity](index=17&type=section&id=Regulatory%20Schedule%20%26%20Activity) The company has multiple regulatory filings and rate adjustment plans across jurisdictions, with an estimated total rate base of **$28 billion** by year-end 2025, featuring diverse authorized ROE and capital structures 2025 Rate Base and Authorized ROE/Equity Ratio | Jurisdiction | ROE / Equity Ratio | 2025 Rate Base (Estimated) | | :--- | :--- | :--- | | TX (E) | 9.65% / 43.25% | $15.4B | | IN (E) | 9.8% / 48.3% | $2.6B | | TX (G) | 9.8% / 60.6% | $3.1B | | MN (G) | N/A / N/A | $2.4B | | N. IN (G) | 9.80% / 46.8% | $2.3B | | OH (G) | N/A / 51.1% | $1.5B | | S. IN (G) | 9.70% / 46.2% | $0.7B | | **Total** | | **$28.0B** | - The regulatory schedule covers various filings from March to November, including TCOS, DCRF, ECA, TDSIC, GRIP, CSIA, GRC, CEP, and DRR mechanisms[49](index=49&type=chunk) [Regulatory Filing Updates](index=18&type=section&id=Regulatory%20Filing%20Updates) The company has submitted multiple regulatory filings, projecting a total annual revenue increase of **$486 million** from various distribution cost recovery, system improvement, and general rate cases Regulatory Filing Updates and Annual Revenue Impact (Millions of USD) | Company | Mechanism | Filing Date | Rate Update Date | Annual Revenue Request Increase / (Decrease) | | :--- | :--- | :--- | :--- | :--- | | CEHE | Distribution Cost Recovery Factor (DCRF) | Feb 2025 | Jul 2025 | $123MM | | | Transmission Cost of Service (TCOS) | Feb 2025 | Apr 2025 | $64MM | | | General Rate Case | Mar 2024 | Apr 2025 | ($47MM) | | IN | General Rate Case | Dec 2023 | Feb 2025 & Mar 2026 | $80MM | | TX Gas | Gas Reliability Infrastructure Program (GRIP) | Feb 2025 | Jun 2025 | $70MM | | | Tax Surcharge | Aug 2024 | Jun 2025 | $15MM | | MN | General Rate Case | Nov 2023 | Sep 2025 | $104MM | | SBR | Compliance & System Improvement Adjustment (CSIA) | Apr 2025 | TBD | N. IN: $9MM, S. IN: $2MM | | OH Gas | Distribution Replacement Rider (DRR) | May 2025 | TBD | $6MM | | | General Rate Case | Oct 2024 | TBD | $60MM | | **Total** | | | | **$486MM** | [Operational Insights and Growth Drivers](index=14&type=section&id=Operational%20Insights%20%26%20Growth%20Drivers) This section explores the diverse drivers of Houston Electric's load growth and presents key weather and throughput data for electricity and natural gas operations [Diverse Houston Electric Load Growth Drivers](index=14&type=section&id=Diverse%20Houston%20Electric%20Load%20Growth%20Drivers) Houston Electric's load growth is driven by **2%** annual residential customer growth, commercial expansion, and electrification in energy, logistics, data centers, and the Port of Houston, projecting peak load from **31GW** to **74GW** by 2031 - Houston's residential customer growth is approximately **2%** annually[40](index=40&type=chunk) Houston Electric Load Growth Drivers and Forecast | Load Type | 2024 Peak Load | 2031 Projected Peak Load | Growth Drivers | | :--- | :--- | :--- | :--- | | Commercial & Energy Refining | ~31GW | ~74GW | Continued petrochemical complex expansion and electrification, refining activity, and energy exports | | Logistics & Transportation | | | Large and medium fleet conversions | | Data Centers | | | Continued expansion of the Texas Medical Center | | Port Electrification | | | Electrification of the Port of Houston | | **Total** | **~31GW** | **~74GW** | | [Weather and Throughput Data](index=16&type=section&id=Weather%20and%20Throughput%20Data) Q2 2025 saw increased electricity and natural gas throughput and customer counts, with electricity up **4%** and natural gas up **3%** year-over-year, and Houston experiencing above-normal heating and cooling degree days Q2 2025 Throughput and Metered Customer Data | Metric | Category | Q2 2025 | Q2 2024 | 2025 vs 2024 | | :--- | :--- | :--- | :--- | :--- | | **Electric Throughput (GWh)** | Residential | 9,588 | 9,450 | 1% | | | Total | 30,313 | 29,034 | 4% | | **Electric Metered Customers** | Residential | 2,663,365 | 2,620,284 | 2% | | | Total | 2,996,732 | 2,950,593 | 2% | | **Natural Gas Throughput** | Residential | 25 | 24 | 5% | | | Commercial & Industrial | 86 | 84 | 2% | | | Total | 111 | 108 | 3% | | **Natural Gas Metered Customers** | Residential | 3,714,672 | 3,670,751 | 1% | | | Commercial & Industrial | 279,526 | 272,168 | 3% | | | Total | 3,994,198 | 3,942,919 | 1% | | **Weather vs Normal** | Houston Heating Degree Days | 1,358 | 1,342 | 16 | | | Houston Cooling Degree Days | 22 | 4 | 18 | Margin Sensitivity | Company | Per HDD / CDD | | :--- | :--- | | CEHE IE | $50k - $70k | | TX Gas | $30k - $40k | [Generation Transition Plan](index=19&type=section&id=Generation%20Transition%20Plan) This section outlines the company's strategic generation transition plan, including the retirement of coal units and the addition of solar and wind projects to replace **730MW** of coal capacity [Planned Generation Project Timeline](index=19&type=section&id=Planned%20Generation%20Project%20Timeline) The company's generation transition plan includes retiring coal units by 2030 and adding solar and wind projects from 2025-2031, aiming to replace **730MW** of coal-fired capacity - Phase 1 of the generation transition will replace **730MW** of coal-fired capacity[54](index=54&type=chunk) Generation Transition Project Timeline | Year | Retirement/Exit | New Generation Projects | | :--- | :--- | :--- | | 2025 | Retire Culley 2 Coal Unit (~90 MW) | Submit 2025 IRP, add 2 Gas Turbines (~460 MW) | | 2026 | Exit Brown 1 & 2 Coal Unit Joint Operations (~490 MW) | Add Posey Solar (~191 MW - BTA) | | 2027 | | Add Salt Creek Wind (~147 MW - PPA) | | 2030 | Retire Warrick 4 Coal Unit (~150 MW) | Add Galesburg Wind (~150 MW - PPA) | | 2031 | | Add Wheatland Solar (~200 MW - BTA) | | 203X | | Add Wind (~200 MW), Add Solar (~200 MW), Add Wind (~170 MW - PPA) | - The plan to convert FB Culley Unit 3 from coal to natural gas has been paused and will be re-evaluated during the 2025 resource planning process[54](index=54&type=chunk) [Appendix: Non-GAAP Reconciliations](index=13&type=section&id=Appendix%3A%20Non-GAAP%20Reconciliations) This appendix provides detailed reconciliations of GAAP to non-GAAP financial measures, including EPS, FFO, and adjusted debt, along with supplementary information and net-zero disclaimers [Non-GAAP EPS Reconciliation](index=20&type=section&id=Non-GAAP%20EPS%20Reconciliation) This section provides detailed reconciliations of GAAP net income and diluted EPS to non-GAAP equivalents for Q2 2025, H1 2025, and FY2024, adjusting for market-to-market, M&A, and TEEEF impacts Q2 2025 Non-GAAP EPS Reconciliation | Item | Amount (Millions of USD) | Diluted EPS | | :--- | :--- | :--- | | GAAP Consolidated Net Income (Loss) and Diluted EPS | $198 | $0.30 | | ZENS Related Mark-to-Market (Gains) Losses: | | | | Equity Securities (After-Tax) | (35) | (0.05) | | Indexed Debt Securities (After-Tax) | 34 | 0.05 | | M&A and Divestiture Related Impacts (After-Tax) | (21) | (0.03) | | Impact of TEEEF Units Removed from Rate Base (After-Tax) | 12 | 0.02 | | **Non-GAAP Consolidated Income and Diluted EPS** | **$188** | **$0.29** | Q2 2024 Non-GAAP EPS Reconciliation | Item | Amount (Millions of USD) | Diluted EPS | | :--- | :--- | :--- | | GAAP Consolidated Net Income (Loss) and Diluted EPS | $228 | $0.36 | | ZENS Related Mark-to-Market (Gains) Losses: | | | | Equity Securities (After-Tax) | (15) | (0.02) | | Indexed Debt Securities (After-Tax) | 8 | 0.02 | | M&A and Divestiture Related Impacts (After-Tax) | 6 | 0.01 | | **Non-GAAP Consolidated Income and Diluted EPS** | **$234** | **$0.36** | H1 2025 Non-GAAP EPS Reconciliation | Item | Amount (Millions of USD) | Diluted EPS | | :--- | :--- | :--- | | GAAP Consolidated Net Income (Loss) and Diluted EPS | $495 | $0.76 | | ZENS Related Mark-to-Market (Gains) Losses: | | | | Equity Securities (After-Tax) | (98) | (0.15) | | Indexed Debt Securities (After-Tax) | 96 | 0.15 | | M&A and Divestiture Related Impacts (After-Tax) | 27 | 0.04 | | Impact of TEEEF Units Removed from Rate Base (After-Tax) | 12 | 0.02 | | **Non-GAAP Consolidated Income and Diluted EPS** | **$532** | **$0.81** | H1 2024 and Full Year 2024 Non-GAAP EPS Reconciliation | Item | H1 2024 (Millions of USD) | H1 2024 (Diluted EPS) | FY2024 (Millions of USD) | FY2024 (Diluted EPS) | | :--- | :--- | :--- | :--- | :--- | | GAAP Consolidated Net Income (Loss) and Diluted EPS | $578 | $0.91 | $1,019 | $1.58 | | ZENS Related Mark-to-Market (Gains) Losses: | | | | | | Equity Securities (After-Tax) | 21 | 0.08 | (15) | (0.02) | | Indexed Debt Securities (After-Tax) | (53) | (0.09) | 11 | 0.01 | | M&A and Divestiture Related Impacts (After-Tax) | 8 | 0.01 | 26 | 0.04 | | **Non-GAAP Consolidated Income and Diluted EPS** | **$584** | **$0.91** | **$1,041** | **$1.62** | [Non-GAAP FFO and Adjusted Debt Reconciliation (Moody's Methodology)](index=24&type=section&id=Non-GAAP%20FFO%20and%20Adjusted%20Debt%20Reconciliation%20%28Moody%27s%20Methodology%29) This section reconciles net cash flow from operations and total debt to non-GAAP FFO and adjusted debt using Moody's methodology, showing an adjusted FFO/Debt ratio of **14.1%** as of Q2 2025 Non-GAAP FFO and Adjusted Debt Reconciliation (Moody's Methodology) (Millions of USD) | Item | FY2024 End | Q1 2025 | Q2 2025 | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities (A) | $2,139 | $2,011 | $1,995 | | Adjusted Operating Cash Flow | 1,983 | 1,890 | 1,954 | | Add: Rating Agency Adjustments | 27 | 99 | 133 | | **Non-GAAP Funds From Operations (FFO) (B)** | **$2,010** | **$1,989** | **$2,087** | | **Net Total Debt (C)** | **20,963** | **22,187** | **21,618** | | Add: Rating Agency Adjustments | (277) | (1,588) | (416) | | **Non-GAAP Rating Agency Adjusted Debt (D)** | **$20,686** | **$20,599** | **$21,202** | | Net Cash Flow from Operating Activities / Net Total Debt (A/C) | 10.2% | 9.1% | 9.2% | | CFO Pre-Tax Working Capital / Debt - Moody's (B/D) | 9.7% | 9.7% | 9.8% | | CNP One-Time Item Adjustments to FFO (E) | 563 | 635 | 666 | | CNP One-Time Item Adjustments to Debt (F) | (1,707) | (1,728) | (1,714) | | **Non-GAAP FFO / Non-GAAP Adjusted Debt (B+E / D+F)** | **13.6%** | **13.9%** | **14.1%** | [Non-GAAP FFO and Adjusted Debt Reconciliation (S&P Methodology)](index=25&type=section&id=Non-GAAP%20FFO%20and%20Adjusted%20Debt%20Reconciliation%20%28S%26P%20Methodology%29) This section reconciles gross margin and total debt to non-GAAP FFO and adjusted debt using S&P's methodology, showing an adjusted FFO/Debt ratio of **12.5%** as of Q2 2025 Non-GAAP FFO and Adjusted Debt Reconciliation (S&P Methodology) (Millions of USD) | Item | FY2024 End | Q1 2025 | Q2 2025 | | :--- | :--- | :--- | :--- | | Unadjusted EBITDA | | | | | Gross Margin | 6,925 | 7,006 | 6,976 | | Operations & Maintenance (O&M) | (2,949) | (2,987) | (3,024) | | Taxes & Other | (547) | (557) | (556) | | **Unadjusted EBITDA** | **3,429** | **3,462** | **3,396** | | Less: Cash Interest Paid | 805 | 867 | 888 | | Less: Cash Taxes Paid | (9) | | (10) | | Add: Rating Agency Adjustments | (161) | (163) | (62) | | **Non-GAAP Funds From Operations (FFO)** | **2,472** | **2,432** | **2,456** | | **Net Total Debt** | **20,963** | **22,187** | **21,618** | | Add: Rating Agency Adjustments | (284) | (1,507) | (377) | | **Non-GAAP Rating Agency Adjusted Debt** | **20,679** | **20,680** | **21,241** | | Unadjusted EBITDA / Net Total Debt | 16.4% | 15.6% | 15.7% | | FFO/Debt (S&P) | 12.0% | 11.8% | 11.6% | | **FFO/Debt (S&P) - Adjusted for One-Time Items** | **12.9%** | **12.8%** | **12.5%** | [Additional Information on Non-GAAP Measures](index=27&type=section&id=Additional%20Information%20on%20Non-GAAP%20Measures) Management utilizes non-GAAP financial metrics to assess performance, believing they offer meaningful comparisons and accurately reflect functional business, but these are not GAAP substitutes - Management uses non-GAAP metrics to evaluate company financial performance, believing they provide additional meaningful comparisons of operational performance[70](index=70&type=chunk) - Non-GAAP metrics more accurately reflect the company's functional business performance but should not replace GAAP reported results[70](index=70&type=chunk) [Net Zero Disclaimer](index=27&type=section&id=Net%20Zero%20Disclaimer) The company targets a **70%** reduction in Scope 1 and 2 GHG emissions by 2035 from 2020 levels and net-zero by 2050, acknowledging inherent risks and uncertainties in achieving these goals - The company aims to reduce Scope 1 and 2 greenhouse gas (GHG) emissions by **70%** by 2035 from 2020 levels[71](index=71&type=chunk) - The company plans to achieve net-zero emissions (Scope 1 and 2) by 2050[71](index=71&type=chunk) - Achieving net-zero targets faces various risks and uncertainties, including regulatory changes, technological innovation, supply chain disruptions, and energy price volatility[71](index=71&type=chunk) [Contacts](index=12&type=section&id=Contacts) This section provides contact information for investor relations, including specific personnel and general inquiry channels [Investor Relations Contact](index=12&type=section&id=Investor%20Relations%20Contact) Investors can contact Ben Vallejo, Director of Investor Relations and Corporate Planning, or use general contact channels for company information - Investor Relations contact: Ben Vallejo, Director of Investor Relations & Corporate Planning, Phone: (713) 207 - 5461, Email: ben.vallejo@centerpointenergy.com[36](index=36&type=chunk) - General contact information: Phone: (713) 207 - 6500, Website: https://investors.centerpointenergy.com/contact-us[36](index=36&type=chunk)

[General Information](index=1&type=section&id=General%20Information) [Form Details and Registrant Information](index=1&type=section&id=Form%20Details%20and%20Registrant%20Information) This section provides the filing details for the Form 10-Q, identifying CenterPoint Energy, Inc., CenterPoint Energy Houston Electric, LLC, and CenterPoint Energy Resources Corp. as registrants, including their corporate information, NYSE-registered securities, filing statuses, and common stock outstanding as of July 21, 2025 - The report is a **Quarterly Report on Form 10-Q** for the period ended June 30, 2025, filed by CenterPoint Energy, Inc., CenterPoint Energy Houston Electric, LLC, and CenterPoint Energy Resources Corp[2](index=2&type=chunk)[3](index=3&type=chunk)[4](index=4&type=chunk) Registrant Filing Status | Registrant | Filer Status | | :-------------------------------- | :------------------- | | CenterPoint Energy, Inc. | Large accelerated filer | | CenterPoint Energy Houston Electric, LLC | Non-accelerated filer | | CenterPoint Energy Resources Corp. | Non-accelerated filer | - As of July 21, 2025, CenterPoint Energy, Inc. had **652,864,878 shares of common stock outstanding**, excluding 166 shares held as treasury stock[11](index=11&type=chunk) [Glossary](index=4&type=section&id=GLOSSARY) This section provides a comprehensive glossary of acronyms and specialized terms used throughout the report, covering financial, regulatory, operational, and legal concepts pertinent to CenterPoint Energy and the utility industry, aiding in the understanding of the document's content [Cautionary Statement Regarding Forward-Looking Information](index=8&type=section&id=CAUTIONARY%20STATEMENT%20REGARDING%20FORWARD-LOOKING%20INFORMATION) This statement advises readers that the report contains forward-looking statements, which are subject to various risks and uncertainties that could cause actual results to differ materially from those projected, outlining numerous factors that could impact future performance - Forward-looking statements are based on management's beliefs and assumptions and are identified by words such as 'anticipate,' 'believe,' 'expect,' 'plan,' 'will,' etc[18](index=18&type=chunk)[19](index=19&type=chunk) - Key factors that could cause actual results to differ include business strategies (e.g., asset sales), industrial/commercial growth, capital funding and recovery, timely rate actions, economic conditions (recession, inflation, interest rates), severe weather events (May 2024 Storm Events, Hurricane Beryl), natural gas market volatility, non-payment for services, federal/state/local regulatory actions, supply chain disruptions, and litigation (e.g., February 2021 Winter Storm Event, Hurricane Beryl)[20](index=20&type=chunk)[21](index=21&type=chunk)[23](index=23&type=chunk) [PART I. FINANCIAL INFORMATION](index=11&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Financial Statements](index=11&type=section&id=Item%201.%20Financial%20Statements) This section presents the unaudited condensed financial statements for CenterPoint Energy, Inc. and its subsidiaries, CenterPoint Energy Houston Electric, LLC, and CenterPoint Energy Resources Corp., for the three and six months ended June 30, 2025 and 2024, including consolidated income statements, balance sheets, cash flow statements, and statements of changes in equity, followed by detailed combined notes [CenterPoint Energy, Inc. and Subsidiaries Financial Statements (Unaudited)](index=11&type=section&id=CenterPoint%20Energy%2C%20Inc.%20and%20Subsidiaries%20Financial%20Statements%20(Unaudited)) Condensed Statements of Consolidated Income (Three Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :-------------------------------- | :----------------- | :----------------- | :------------ | | Total Revenues | $1,944 | $1,905 | +$39 | | Operating Income | $417 | $467 | -$50 | | Net Income | $198 | $228 | -$30 | | Basic Earnings Per Common Share | $0.30 | $0.36 | -$0.06 | | Diluted Earnings Per Common Share | $0.30 | $0.36 | -$0.06 | Condensed Statements of Consolidated Income (Six Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :-------------------------------- | :----------------- | :----------------- | :------------ | | Total Revenues | $4,864 | $4,525 | +$339 | | Operating Income | $1,066 | $1,083 | -$17 | | Net Income | $495 | $578 | -$83 | | Basic Earnings Per Common Share | $0.76 | $0.91 | -$0.15 | | Diluted Earnings Per Common Share | $0.76 | $0.91 | -$0.15 | Condensed Consolidated Balance Sheets (as of June 30, 2025 vs. December 31, 2024) | Metric | June 30, 2025 (in millions) | Dec 31, 2024 (in millions) | Change | | :-------------------------------- | :------------------------- | :------------------------- | :------- | | Total Current Assets | $2,930 | $4,381 | -$1,451 | | Property, Plant and Equipment, Net | $33,901 | $32,089 | +$1,812 | | Total Assets | $44,099 | $43,768 | +$331 | | Total Current Liabilities | $3,695 | $4,045 | -$350 | | Total Long-term Debt, Net | $20,564 | $20,397 | +$167 | | Total Shareholders' Equity | $11,019 | $10,666 | +$353 | Condensed Statements of Consolidated Cash Flows (Six Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :-------------------------------- | :----------------- | :----------------- | :------------ | | Net cash provided by operating activities | $970 | $1,114 | -$144 | | Net cash used in investing activities | $(1,341) | $(1,600) | +$259 | | Net cash provided by financing activities | $440 | $459 | -$19 | | Net Increase (Decrease) in Cash | $69 | $(27) | +$96 | [CenterPoint Energy Houston Electric, LLC and Subsidiaries Financial Statements (Unaudited)](index=17&type=section&id=CenterPoint%20Energy%20Houston%20Electric%2C%20LLC%20and%20Subsidiaries%20Financial%20Statements%20(Unaudited)) Condensed Statements of Consolidated Income (Three Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :----------------- | :----------------- | :----------------- | :------------ | | Revenues | $1,008 | $1,044 | -$36 | | Operating Income | $252 | $303 | -$51 | | Net Income | $141 | $187 | -$46 | Condensed Statements of Consolidated Income (Six Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :----------------- | :----------------- | :----------------- | :------------ | | Revenues | $1,892 | $1,945 | -$53 | | Operating Income | $434 | $493 | -$59 | | Net Income | $225 | $286 | -$61 | Condensed Consolidated Balance Sheets (as of June 30, 2025 vs. December 31, 2024) | Metric | June 30, 2025 (in millions) | Dec 31, 2024 (in millions) | Change | | :-------------------------------- | :------------------------- | :------------------------- | :------- | | Total Current Assets | $1,022 | $1,265 | -$243 | | Property, Plant and Equipment, Net | $17,939 | $17,122 | +$817 | | Total Assets | $20,402 | $19,712 | +$690 | | Total Current Liabilities | $1,895 | $1,741 | +$154 | | Long-Term Debt, Net | $8,820 | $8,322 | +$498 | | Total Member's Equity | $7,202 | $7,159 | +$43 | Condensed Statements of Consolidated Cash Flows (Six Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :-------------------------------- | :----------------- | :----------------- | :------------ | | Net cash provided by operating activities | $117 | $350 | -$233 | | Net cash used in investing activities | $(881) | $(852) | -$29 | | Net cash provided by financing activities | $765 | $487 | +$278 | | Net Increase (Decrease) in Cash | $1 | $(15) | +$16 | [CenterPoint Energy Resources Corp. and Subsidiaries Financial Statements (Unaudited)](index=21&type=section&id=CenterPoint%20Energy%20Resources%20Corp.%20and%20Subsidiaries%20Financial%20Statements%20(Unaudited)) Condensed Statements of Consolidated Income (Three Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :----------------- | :----------------- | :----------------- | :------------ | | Total Revenues | $731 | $679 | +$52 | | Operating Income | $124 | $117 | +$7 | | Net Income | $86 | $47 | +$39 | Condensed Statements of Consolidated Income (Six Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :----------------- | :----------------- | :----------------- | :------------ | | Total Revenues | $2,519 | $2,191 | +$328 | | Operating Income | $531 | $487 | +$44 | | Net Income | $391 | $311 | +$80 | Condensed Consolidated Balance Sheets (as of June 30, 2025 vs. December 31, 2024) | Metric | June 30, 2025 (in millions) | Dec 31, 2024 (in millions) | Change | | :-------------------------------- | :------------------------- | :------------------------- | :------- | | Total Current Assets | $819 | $2,537 | -$1,718 | | Property, Plant and Equipment, Net | $11,888 | $11,406 | +$482 | | Total Assets | $15,012 | $16,425 | -$1,413 | | Total Current Liabilities | $845 | $1,260 | -$415 | | Long-Term Debt, Net | $4,347 | $5,174 | -$827 | | Total Stockholder's Equity | $6,009 | $6,268 | -$259 | Condensed Statements of Consolidated Cash Flows (Six Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :-------------------------------- | :----------------- | :----------------- | :------------ | | Net cash provided by operating activities | $1,025 | $755 | +$270 | | Net cash used in investing activities | $455 | $(705) | +$1,160 | | Net cash used in financing activities | $(1,482) | $(50) | -$1,432 | | Net Increase (Decrease) in Cash | $(2) | $0 | -$2 | [Combined Notes to Interim Condensed Financial Statements (Unaudited)](index=27&type=section&id=Combined%20Notes%20to%20Interim%20Condensed%20Financial%20Statements%20(Unaudited)) [(1) Background and Basis of Presentation](index=27&type=section&id=(1)%20Background%20and%20Basis%20of%20Presentation) - CenterPoint Energy is a public utility holding company with operating subsidiaries owning and operating electric transmission, distribution, and generation facilities, and natural gas distribution systems[49](index=49&type=chunk) - On March 7, 2025, SIGECO acquired Posey Solar (**191 MW solar array**) for approximately **$357 million**. On March 31, 2025, CERC Corp. completed the sale of its Louisiana and Mississippi natural gas LDC businesses for approximately **$1.2 billion**[51](index=51&type=chunk) - The Interim Condensed Financial Statements are prepared in conformity with GAAP, consolidating wholly-owned and majority-owned subsidiaries, with intercompany transactions eliminated[52](index=52&type=chunk)[53](index=53&type=chunk) - CenterPoint Energy, Houston Electric, and SIGECO consolidate Variable Interest Entities (VIEs) like Transition Bond Company IV and SIGECO Securitization Subsidiary, which are bankruptcy-remote special purpose entities for securitization[54](index=54&type=chunk) [(2) Accounting Policies and Recent Accounting Pronouncements](index=28&type=section&id=(2)%20Accounting%20Policies%20and%20Recent%20Accounting%20Pronouncements) - There have been **no material changes** in significant accounting policies from the combined 2024 Form 10-K, except as discussed[56](index=56&type=chunk) Cash, Cash Equivalents and Restricted Cash (June 30, 2025) | Registrant | Cash & Cash Equivalents (in millions) | Restricted Cash (in millions) | Total (in millions) | | :------------------------- | :------------------------------------ | :---------------------------- | :------------------ | | CenterPoint Energy | $93 | $6 | $99 | | Houston Electric | $15 | $0 | $15 | | CERC | $0 | $0 | $0 | - ASU 2023-09 (Income Taxes) enhances transparency of income tax disclosures, effective for annual periods beginning after December 15, 2024. ASU 2024-03 (Expense Disaggregation) improves disclosure of public business entity expenses, effective for annual periods beginning after December 15, 2026[58](index=58&type=chunk)[59](index=59&type=chunk) [(3) Acquisition and Divestiture](index=29&type=section&id=(3)%20Acquisition%20and%20Divestiture) - CERC Corp. completed the sale of its Louisiana and Mississippi natural gas LDC businesses on March 31, 2025, for approximately **$1.2 billion**. CenterPoint Energy recognized a **$43 million loss**, and CERC recognized a **$52 million gain**, net of **$21 million transaction costs**, for the six months ended June 30, 2025[62](index=62&type=chunk)[65](index=65&type=chunk) - Goodwill of **$217 million** (CenterPoint Energy) and **$122 million** (CERC) allocated to the divested businesses was derecognized. CERC entered into a Transition Services Agreement to provide services for up to 24 months, with charges of **$8.5 million** for the three and six months ended June 30, 2025[65](index=65&type=chunk)[66](index=66&type=chunk) - On March 7, 2025, SIGECO acquired **100%** of the equity interests in Posey Solar, which was constructing a **191 MW solar array**, for approximately **$357 million**. The project was placed into service on May 30, 2025, with cost recovery through updated base rates beginning June 17, 2025[68](index=68&type=chunk) [(4) Revenue Recognition](index=31&type=section&id=(4)%20Revenue%20Recognition) CenterPoint Energy Revenues by Segment (Six Months Ended June 30, 2025) | Segment | Revenue from Contracts with Customers (in millions) | Other (in millions) | Total Revenues (in millions) | | :---------------- | :---------------------------------------- | :------------------ | :--------------------------- | | Electric | $2,267 | $(10) | $2,257 | | Natural Gas | $2,639 | $(35) | $2,602 | | Corporate and Other | $3 | $2 | $5 | | **Total** | **$4,909** | **$(43)** | **$4,864** | Houston Electric Revenues (Six Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :-------------------------------- | :----------------- | :----------------- | :------------ | | Revenue from contracts with customers | $1,906 | $1,959 | -$53 | | Total revenues | $1,892 | $1,945 | -$53 | CERC Revenues (Six Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :-------------------------------- | :----------------- | :----------------- | :------------ | | Revenue from contracts with customers | $2,555 | $2,167 | +$388 | | Total revenues | $2,519 | $2,191 | +$328 | Accounts Receivable and Accrued Unbilled Revenues (CenterPoint Energy, June 30, 2025 vs. Dec 31, 2024) | Metric | Dec 31, 2024 (in millions) | June 30, 2025 (in millions) | Change | | :------------------------- | :------------------------- | :-------------------------- | :------- | | Accounts Receivable | $666 | $636 | -$30 | | Accrued Unbilled Revenues | $521 | $342 | -$179 | [(5) Employee Benefit Plans](index=33&type=section&id=(5)%20Employee%20Benefit%20Plans) CenterPoint Energy Pension Benefits (Six Months Ended June 30) | Metric | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :----------------------------- | :----------------- | :----------------- | :------------ | | Service cost | $12 | $12 | $0 | | Interest cost | $39 | $37 | +$2 | | Expected return on plan assets | $(40) | $(37) | -$3 | | Amortization of net loss | $14 | $14 | $0 | | **Net periodic cost** | **$25** | **$26** | **-$1** | Expected Contributions to Pension and Postretirement Plans (2025) | Registrant | Pension Plans (in millions) | Postretirement Plans (in millions) | | :----------------- | :-------------------------- | :--------------------------------- | | CenterPoint Energy | $116 | $9 | | Houston Electric | $0 | $1 | | CERC | $0 | $5 | [(6) Regulatory Matters](index=34&type=section&id=(6)%20Regulatory%20Matters) Unrecognized Equity Return (June 30, 2025) | Registrant | Amount (in millions) | | :----------------- | :------------------- | | CenterPoint Energy | $296 | | Houston Electric | $131 | | CERC | $101 | - As of June 30, 2025, CenterPoint Energy and CERC each recorded current regulatory assets of **$67 million** and non-current regulatory assets of **$30 million** associated with the February 2021 Winter Storm Event[82](index=82&type=chunk) - Houston Electric's TEEEF regulatory assets totaled **$84 million** for short-term lease expenses and **$156 million** for long-term lease expenses as of June 30, 2025. Houston Electric proposed to release **15 large TEEEF units** to the San Antonio area and filed for preapproval to lease additional smaller TEEEF units[89](index=89&type=chunk)[93](index=93&type=chunk)[95](index=95&type=chunk) - For the May 2024 Storm Events, Houston Electric filed for determination of approximately **$502 million** in system restoration costs, with a settlement approving **$396 million** in distribution-related costs and **$29 million** in transmission-related costs. Houston Electric and Restoration Bond Company II filed to register up to **$396 million** in securitization bonds[97](index=97&type=chunk)[98](index=98&type=chunk) - For Hurricane Beryl, Houston Electric filed for determination of approximately **$1.3 billion** in system restoration costs[101](index=101&type=chunk) [(7) Fair Value Measurements](index=38&type=section&id=(7)%20Fair%20Value%20Measurements) - Assets and liabilities are categorized into Level 1 (quoted prices in active markets), Level 2 (observable inputs other than Level 1 quoted prices), and Level 3 (unobservable inputs). **No assets or liabilities were classified as Level 3** as of June 30, 2025, and December 31, 2024[102](index=102&type=chunk)[103](index=103&type=chunk)[104](index=104&type=chunk)[105](index=105&type=chunk) CenterPoint Energy Fair Value Assets/Liabilities (June 30, 2025) | Category | Level 1 (in millions) | Level 2 (in millions) | Total (in millions) | | :-------------------------- | :-------------------- | :-------------------- | :------------------ | | Equity securities | $683 | $0 | $683 | | Investments | $20 | $0 | $20 | | Indexed debt securities derivative | $0 | $740 | $740 | Long-term Debt Fair Value (June 30, 2025) | Registrant | Carrying Amount (in millions) | Fair Value (in millions) | | :----------------- | :---------------------------- | :----------------------- | | CenterPoint Energy | $21,618 | $20,698 | | Houston Electric | $9,320 | $8,388 | | CERC | $4,347 | $4,304 | [(8) Equity Securities and Indexed Debt Securities (ZENS) (CenterPoint Energy)](index=40&type=section&id=(8)%20Equity%20Securities%20and%20Indexed%20Debt%20Securities%20(ZENS)) Gains (Losses) on Equity Securities (Six Months Ended June 30) | Security | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :--------------- | :----------------- | :----------------- | :------------ | | AT&T Common | $63 | $24 | +$39 | | Charter Common | $57 | $(78) | +$135 | | WBD Common | $2 | $(10) | +$12 | | **Total** | **$122** | **$(64)** | **+$186** | Equity Securities Carrying Value (June 30, 2025) | Security | Shares Held | Carrying Value (in millions) | | :--------------- | :---------- | :--------------------------- | | AT&T Common | 10,212,945 | $296 | | Charter Common | 872,503 | $356 | | WBD Common | 2,470,685 | $28 | | **Total** | | **$683** | - As of June 30, 2025, ZENS with an original principal amount of **$828 million** and a contingent principal amount of **$4 million** were outstanding. If all ZENS were exchanged for cash on this date, approximately **$819 million** in deferred taxes and **$108 million** in capital gains taxes would be payable[113](index=113&type=chunk)[290](index=290&type=chunk) [(9) Short-term Borrowings and Long-term Debt](index=40&type=section&id=(9)%20Short-term%20Borrowings%20and%20Long-term%20Debt) - In January 2025, SIGECO issued **$165 million** of **5.69% First Mortgage Bonds** due 2055 for the Posey Solar acquisition. In February 2025, Houston Electric issued **$500 million** of **4.80% General Mortgage Bonds** due 2030[114](index=114&type=chunk)[115](index=115&type=chunk) - In May 2025, CenterPoint Energy accepted **$1 billion** aggregate purchase price of its and CERC's senior notes, resulting in a **$36 million gain** (CenterPoint Energy) and **$9 million gain** (CERC) on early extinguishment of debt[117](index=117&type=chunk) Revolving Credit Facilities (June 30, 2025) | Registrant | Size of Facility (in millions) | Termination Date | Debt for Borrowed Money to Capital Ratio | | :----------------- | :----------------------------- | :--------------- | :--------------------------------------- | | CenterPoint Energy | $2,400 | Dec 6, 2028 | 59.5% | | CenterPoint Energy (SIGECO) | $250 | Dec 6, 2028 | 45.0% | | Houston Electric | $300 | Dec 6, 2028 | 55.7% | | CERC | $1,050 | Dec 6, 2028 | 38.0% | | **Total** | **$4,000** | | | - As of June 30, 2025, CenterPoint Energy had **$1,845 million** in commercial paper outstanding (**4.60% avg. interest rate**), and CERC had **$192 million** (**4.52% avg. interest rate**)[121](index=121&type=chunk) [(10) Income Taxes](index=42&type=section&id=(10)%20Income%20Taxes) Effective Tax Rates (Three Months Ended June 30) | Registrant | 2025 | 2024 | | :----------------- | :----- | :----- | | CenterPoint Energy | 22% | 13% | | Houston Electric | 20% | 20% | | CERC | 11% | 24% | Effective Tax Rates (Six Months Ended June 30) | Registrant | 2025 | 2024 | | :----------------- | :----- | :----- | | CenterPoint Energy | 22% | 16% | | Houston Electric | 20% | 20% | | CERC | 22% | 19% | - CenterPoint Energy's higher effective tax rate for 2025 periods was primarily due to non-deductible goodwill from the Louisiana and Mississippi natural gas LDC sale and reduced favorable tax return true-ups. CERC's lower Q2 2025 rate was due to a **$12 million deferred income tax benefit**, partially offset by non-deductible goodwill from the LDC sale[125](index=125&type=chunk)[126](index=126&type=chunk) - CenterPoint Energy reported a net uncertain tax liability of **$30 million** as of June 30, 2025, with a reasonably possible **$11 million tax benefit** expected in the next 12 months[127](index=127&type=chunk) [(11) Commitments and Contingencies](index=43&type=section&id=(11)%20Commitments%20and%20Contingencies) Undiscounted Minimum Purchase Obligations (CenterPoint Energy and CERC, June 30, 2025) | Category | CenterPoint Energy (in millions) | CERC (in millions) | | :-------------------- | :----------------------------- | :----------------- | | Natural Gas Supply | $4,230 | $4,184 | | Electric Supply | $1,353 | N/A | | Other | $352 | N/A | - CenterPoint Energy's maximum exposure under parent company level guarantees for Energy Systems Group's obligations is approximately **$457 million** as of June 30, 2025, primarily for energy savings performance contracts[136](index=136&type=chunk) - CenterPoint Energy and Houston Electric are involved in multiple putative class actions and individual lawsuits related to Hurricane Beryl, alleging negligence, property damage, and economic losses. Cases are being transferred to an MDL pretrial court[139](index=139&type=chunk)[140](index=140&type=chunk)[141](index=141&type=chunk) - Litigation related to the February 2021 Winter Storm Event continues, with approximately **220 pending lawsuits**. The Texas Supreme Court affirmed ERCOT's sovereign immunity, and the MDL judge dismissed certain claims against TDUs while allowing repleading of gross negligence claims[142](index=142&type=chunk)[143](index=143&type=chunk)[144](index=144&type=chunk)[145](index=145&type=chunk) - CERC was named in **12 lawsuits** alleging gas market manipulation; the MDL judge granted motions to dismiss and CERC's plea to jurisdiction in three served cases, dismissing all claims against CERC with prejudice[149](index=149&type=chunk)[151](index=151&type=chunk) - CenterPoint Energy and CERC have accrued **$13 million** and **$11 million**, respectively, for remediation of Minnesota MGP sites, with estimated costs ranging from **$8 million to $47 million** (CenterPoint Energy) and **$7 million to $41 million** (CERC) over 5 to 50 years[155](index=155&type=chunk)[156](index=156&type=chunk) - CenterPoint Energy recorded an approximate **$132 million ARO** for A.B. Brown and F.B. Culley ash pond closures and an additional **$11 million ARO** for historic ash placement at F.B. Culley under the CCR Legacy Rule[163](index=163&type=chunk)[164](index=164&type=chunk) [(12) Earnings Per Share (CenterPoint Energy)](index=50&type=section&id=(12)%20Earnings%20Per%20Share) Basic and Diluted EPS (Three Months Ended June 30) | Metric | 2025 | 2024 | Change (YoY) | | :-------------------------------- | :----- | :----- | :------------ | | Basic Earnings Per Common Share | $0.30 | $0.36 | -$0.06 | | Diluted Earnings Per Common Share | $0.30 | $0.36 | -$0.06 | Basic and Diluted EPS (Six Months Ended June 30) | Metric | 2025 | 2024 | Change (YoY) | | :-------------------------------- | :----- | :----- | :------------ | | Basic Earnings Per Common Share | $0.76 | $0.91 | -$0.15 | | Diluted Earnings Per Common Share | $0.76 | $0.91 | -$0.15 | - Dilutive earnings per common share reflects the dilutive impact of potential issuances of shares of Common Stock associated with outstanding equity forwards, determined under the treasury stock method[170](index=170&type=chunk) [(13) Reportable Segments](index=50&type=section&id=(13)%20Reportable%20Segments) - CenterPoint Energy's reportable segments are Electric (Texas Gulf Coast, southwestern Indiana), Natural Gas (Indiana, Minnesota, Ohio, Texas), and Corporate and Other. Houston Electric and CERC each consist of a single reportable segment[175](index=175&type=chunk)[176](index=176&type=chunk)[177](index=177&type=chunk) CenterPoint Energy Net Income by Segment (Six Months Ended June 30, 2025) | Segment | Net Income (in millions) | | :------------------ | :----------------------- | | Electric | $279 | | Natural Gas | $314 | | Corporate and Other | $(98) | | **Total** | **$495** | CenterPoint Energy Expenditures for Long-lived Assets (Six Months Ended June 30) | Segment | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :------------------ | :----------------- | :----------------- | :------------ | | Electric | $1,716 | $951 | +$765 | | Natural Gas | $696 | $712 | -$16 | | Corporate and Other | $18 | $7 | +$11 | | **Consolidated** | **$2,430** | **$1,670** | **+$760** | CenterPoint Energy Total Assets by Segment (June 30, 2025) | Segment | Total Assets (in millions) | | :------------------ | :------------------------- | | Electric | $25,231 | | Natural Gas | $17,090 | | Corporate and Other | $1,778 | | **Consolidated** | **$44,099** | [(14) Related Party Transactions](index=54&type=section&id=(14)%20Related%20Party%20Transactions) - Houston Electric had **$453 million** in money pool borrowings, and CERC had **$1 million** in money pool investments as of June 30, 2025, with a weighted average interest rate of **4.65%**[186](index=186&type=chunk) Corporate Service Charges (Six Months Ended June 30) | Registrant | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :----------------- | :----------------- | :----------------- | :------------ | | Houston Electric | $90 | $79 | +$11 | | CERC | $106 | $106 | $0 | [(15) Equity](index=55&type=section&id=(15)%20Equity) Dividends Declared Per Share (Common Stock, Six Months Ended June 30) | Year | Per Share | | :--- | :-------- | | 2025 | $0.440 | | 2024 | $0.400 | - CenterPoint Energy entered into forward sale agreements in April and May 2025 for a total of **4,480,628 shares of Common Stock**, with a gross sales price of approximately **$165 million**, under its Equity Distribution Agreement[192](index=192&type=chunk)[193](index=193&type=chunk) - In May 2025, CenterPoint Energy entered into separate forward sale agreements for an aggregate of **24,864,865 shares of Common Stock** at an initial forward price of **$36.26 per share**, totaling **$904 million**[194](index=194&type=chunk)[195](index=195&type=chunk) - CenterPoint Energy's Accumulated Other Comprehensive Loss was **$(17) million** as of June 30, 2025[197](index=197&type=chunk) [(16) Subsequent Events](index=57&type=section&id=(16)%20Subsequent%20Events) - In July 2025, SIGECO repaid **$41 million** of **3.45% first mortgage bonds** due 2025[198](index=198&type=chunk) - On July 1, 2025, SIGECO closed on **$205 million** of Series 2025B First Mortgage Bonds and expects to close on **$145 million** of Series 2025C Bonds by October 1, 2025, for general corporate purposes[199](index=199&type=chunk)[200](index=200&type=chunk) - A common stock dividend of **$0.2200 per share** was declared on July 17, 2025, payable September 11, 2025[201](index=201&type=chunk) - Jesus Soto, Jr. was appointed Executive Vice President and Chief Operating Officer, effective August 11, 2025[202](index=202&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=59&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the financial condition and results of operations for CenterPoint Energy, Inc. and its subsidiaries, covering recent events, consolidated and segment-specific financial performance, factors affecting future earnings, and a detailed analysis of liquidity and capital resources [Recent Events](index=59&type=section&id=RECENT%20EVENTS) - Jesus Soto, Jr. was appointed Executive Vice President and Chief Operating Officer, effective August 11, 2025[206](index=206&type=chunk) - The One Big Beautiful Bill Act of 2025 (OBBBA) was signed into law on July 4, 2025, with Executive Order 14315 issued on July 7, 2025, introducing changes to energy tax credits. Registrants do not expect **material impacts** due to limited generation activities qualifying for IRA tax credits[207](index=207&type=chunk) - Houston Electric entered definitive documentation to release **15 large TEEEF units** to the San Antonio area for up to two years, without charging Houston customers or receiving revenue from ERCOT[208](index=208&type=chunk) - CenterPoint Energy increased its 10-year capital plan by an additional **$4.5 billion** (totaling approximately **$53 billion through 2030**) to support growth in Texas[209](index=209&type=chunk) - CenterPoint Energy plans to sell its Ohio natural gas LDC business for capital recycling and portfolio optimization; assets are **not yet classified as held for sale**[210](index=210&type=chunk) - CenterPoint Energy entered into forward sale agreements in May 2025 for **24,864,865 shares of Common Stock** and in April/May 2025 for **4,480,628 shares** under its Equity Distribution Agreement[211](index=211&type=chunk)[212](index=212&type=chunk) - The sale of Louisiana and Mississippi natural gas LDC businesses was completed on March 31, 2025, for approximately **$1.2 billion**. SIGECO acquired Posey Solar (**191 MW solar array**) for approximately **$357 million** on March 7, 2025[213](index=213&type=chunk)[214](index=214&type=chunk) [CenterPoint Energy Consolidated Results of Operations](index=61&type=section&id=CENTERPOINT%20ENERGY%20CONSOLIDATED%20RESULTS%20OF%20OPERATIONS) Net Income (Three Months Ended June 30) | Segment | 2025 (in millions) | 2024 (in millions) | Favorable (Unfavorable) (in millions) | | :-------------------- | :----------------- | :----------------- | :------------------------------------ | | Electric | $171 | $215 | $(44) | | Natural Gas | $86 | $47 | $39 | | Total Utility Operations | $257 | $262 | $(5) | | Corporate and Other | $(59) | $(34) | $(25) | | **Total CenterPoint Energy** | **$198** | **$228** | **$(30)** | Net Income (Six Months Ended June 30) | Segment | 2025 (in millions) | 2024 (in millions) | Favorable (Unfavorable) (in millions) | | :-------------------- | :----------------- | :----------------- | :------------------------------------ | | Electric | $279 | $336 | $(57) | | Natural Gas | $314 | $330 | $(16) | | Total Utility Operations | $593 | $666 | $(73) | | Corporate and Other | $(98) | $(88) | $(10) | | **Total CenterPoint Energy** | **$495** | **$578** | **$(83)** | - The **$30 million decrease in net income** for the three months ended June 30, 2025, was primarily due to a **$44 million decrease in the Electric segment** and a **$25 million decrease in Corporate and Other** (driven by increased borrowing costs and tax expense, partially offset by a gain on early debt extinguishment)[219](index=219&type=chunk) - The **$83 million decrease in net income** for the six months ended June 30, 2025, was primarily due to a **$57 million decrease in the Electric segment**, a **$16 million decrease in the Natural Gas segment**, and a **$10 million decrease in Corporate and Other** (driven by increased borrowing costs and tax benefits offset in other segments, partially offset by a gain on early debt extinguishment)[220](index=220&type=chunk) [Results of Operations by Reportable Segment](index=62&type=section&id=Results%20of%20Operations%20by%20Reportable%20Segment) [Electric (CenterPoint Energy)](index=62&type=section&id=Electric%20(CenterPoint%20Energy)) - Net income for the Electric reportable segment **decreased by $44 million to $171 million** for the three months ended June 30, 2025, and by **$57 million to $279 million** for the six months ended June 30, 2025, compared to the prior year periods[223](index=223&type=chunk) - Total throughput for the Electric segment **increased by 4%** for the three months and **6%** for the six months ended June 30, 2025. Residential throughput **increased by 1% and 5%** for the respective periods[223](index=223&type=chunk) - Customer growth for the Electric segment was **2%** for both the three and six months ended June 30, 2025[223](index=223&type=chunk) - Revenue decrease for the three months ended June 30, 2025, was primarily due to a **$(44) million unfavorable impact** from Transition Bond Company IV, partially offset by **+$21 million from Transmission Revenues** and **+$13 million from cost of fuel and purchased power**[224](index=224&type=chunk) - Operation and maintenance expenses **increased by $(26) million** for the three months ended June 30, 2025, mainly due to **$(24) million in contract services**. Depreciation and amortization saw a **favorable change of +$7 million**, driven by **+$42 million from Transition Bond Company IV and SIGECO Securitization Subsidiary**, partially offset by ongoing plant additions and temporary generation lease expense[224](index=224&type=chunk) [Natural Gas (CenterPoint Energy)](index=65&type=section&id=Natural%20Gas%20(CenterPoint%20Energy)) - Net income for the Natural Gas reportable segment **increased by $39 million to $86 million** for the three months ended June 30, 2025, but **decreased by $16 million to $314 million** for the six months ended June 30, 2025, compared to the prior year periods[227](index=227&type=chunk) - Total throughput for the Natural Gas segment **decreased by 4%** for the three months but **increased by 6%** for the six months ended June 30, 2025. Residential throughput **increased by 13%** for the six-month period[227](index=227&type=chunk) - The number of metered customers for the Natural Gas segment **decreased by 8%** primarily due to the divestiture of the Louisiana and Mississippi natural gas LDCs[227](index=227&type=chunk) - Revenue increase for the six months ended June 30, 2025, was primarily driven by **+$261 million from the cost of natural gas** (offset in expenses) and **+$74 million from customer rates**, partially offset by a **$(46) million unfavorable impact** from the LDC divestiture[228](index=228&type=chunk) - Utility natural gas and fuel expenses **increased by $(242) million** for the six months ended June 30, 2025, mainly due to the cost of natural gas. A **$(43) million loss on sale** was recognized due to the divestiture of the Louisiana and Mississippi natural gas LDC businesses[228](index=228&type=chunk) [Houston Electric Consolidated Results of Operations](index=67&type=section&id=HOUSTON%20ELECTRIC%20CONSOLIDATED%20RESULTS%20OF%20OPERATIONS) - Net income for Houston Electric **decreased by $46 million to $141 million** for the three months ended June 30, 2025, and by **$61 million to $225 million** for the six months ended June 30, 2025, compared to the prior year periods[231](index=231&type=chunk) - Total throughput for Houston Electric **increased by 5%** for the three months and **6%** for the six months ended June 30, 2025. Residential throughput **increased by 2% and 5%** for the respective periods[231](index=231&type=chunk) - Customer growth for Houston Electric was **2%** for both the three and six months ended June 30, 2025[231](index=231&type=chunk) - Revenue decrease for the six months ended June 30, 2025, was primarily due to a **$(76) million unfavorable impact** from Transition Bond Company IV, partially offset by **+$22 million from weather and usage**, and **+$11 million from Transmission Revenues and customer growth**[232](index=232&type=chunk) - Operation and maintenance expenses **increased by $(40) million** for the six months ended June 30, 2025, mainly due to contract services and corporate support services. Depreciation and amortization **increased by $(39) million**, driven by ongoing plant additions and temporary generation lease expense[232](index=232&type=chunk) [CERC CONSOLIDATED RESULTS OF OPERATIONS](index=69&type=section&id=CERC%20CONSOLIDATED%20RESULTS%20OF%20OPERATIONS) - Net income for CERC **increased by $39 million to $86 million** for the three months ended June 30, 2025, and by **$80 million to $391 million** for the six months ended June 30, 2025, compared to the prior year periods[235](index=235&type=chunk) - Total throughput for CERC **decreased by 7%** for the three months but **increased by 4%** for the six months ended June 30, 2025. Residential throughput **increased by 14%** for the six-month period[235](index=235&type=chunk) - The number of metered customers for CERC **decreased by 8%** primarily due to the divestiture of the Louisiana and Mississippi natural gas LDCs[235](index=235&type=chunk) - Revenue increase for the six months ended June 30, 2025, was primarily driven by **+$250 million from the cost of natural gas** (offset in expenses) and **+$70 million from customer rates**, partially offset by a **$(46) million unfavorable impact** from the LDC divestiture[236](index=236&type=chunk) - Utility natural gas expenses **increased by $(234) million** for the six months ended June 30, 2025, mainly due to the cost of natural gas. A **+$52 million gain on sale** was recognized due to the divestiture of the Louisiana and Mississippi natural gas LDC businesses[236](index=236&type=chunk) [Certain Factors Affecting Future Earnings](index=71&type=section&id=CERTAIN%20FACTORS%20AFFECTING%20FUTURE%20EARNINGS) - This section refers to the 'Risk Factors' in Part I, Item 1A of the Registrants' combined 2024 Form 10-K and the 'Cautionary Statement Regarding Forward-Looking Information' in this combined Form 10-Q for information on factors impacting future earnings[238](index=238&type=chunk) [Liquidity and Capital Resources](index=71&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) [Cash Flows Analysis](index=71&type=section&id=Cash%20Flows%20Analysis) CenterPoint Energy Cash Flows (Six Months Ended June 30) | Activity | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :-------------------- | :----------------- | :----------------- | :------------ | | Operating activities | $970 | $1,114 | $(144) | | Investing activities | $(1,341) | $(1,600) | $259 | | Financing activities | $440 | $459 | $(19) | Houston Electric Cash Flows (Six Months Ended June 30) | Activity | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :-------------------- | :----------------- | :----------------- | :------------ | | Operating activities | $117 | $350 | $(233) | | Investing activities | $(881) | $(852) | $(29) | | Financing activities | $765 | $487 | $278 | CERC Cash Flows (Six Months Ended June 30) | Activity | 2025 (in millions) | 2024 (in millions) | Change (YoY) | | :-------------------- | :----------------- | :----------------- | :------------ | | Operating activities | $1,025 | $755 | $270 | | Investing activities | $455 | $(705) | $1,160 | | Financing activities | $(1,482) | $(50) | $(1,432) | - CenterPoint Energy's operating cash flow **decreased by $144 million**, primarily due to changes in net income after non-cash items (**$-180M**) and working capital (**$-269M**). CERC's investing cash flow **increased by $1,160 million**, driven by **$1,219 million in proceeds from divestiture**[240](index=240&type=chunk) - CERC's financing cash flow **decreased by $1,432 million**, primarily due to increased dividends to parent (**$-404M**), changes in contribution from parent (**$-290M**), and net payments of long-term debt (**$-820M**)[241](index=241&type=chunk) [Future Capital Requirements and Funding](index=72&type=section&id=Future%20Capital%20Requirements%20and%20Funding) Estimated Capital Expenditures (Remainder of 2025) | Registrant | Amount (in millions) | | :----------------- | :------------------- | | CenterPoint Energy | $2,929 | | Houston Electric | $1,835 | | CERC | $895 | - Estimated restoration costs associated with the May 2024 Storm Events for the remainder of 2025 are **$28 million** for CenterPoint Energy and Houston Electric[242](index=242&type=chunk) - Anticipated cash needs for the remainder of 2025 are expected to be met with available cash flow from operations, incremental bond issuances (including securitization), equity issuances, and borrowings under credit facilities, commercial paper, or other sources[244](index=244&type=chunk) [Off-Balance Sheet Arrangements](index=73&type=section&id=Off-Balance%20Sheet%20Arrangements) - The Registrants have **no off-balance sheet arrangements** other than Houston Electric's general mortgage bonds issued as collateral for CenterPoint Energy's tax-exempt long-term debt and certain guarantees[246](index=246&type=chunk) [Regulatory Matters](index=73&type=section&id=Regulatory%20Matters) - Houston Electric is pursuing regulatory approvals for its TEEEF units, including a proposal to release **15 large units** to the San Antonio area and an application for preapproval to lease additional small units[247](index=247&type=chunk)[208](index=208&type=chunk)[95](index=95&type=chunk) - Houston Electric filed for determination of **$1.3 billion** in system restoration costs related to Hurricane Beryl and received approval to securitize **$396 million** in distribution-related costs for the May 2024 Storm Events[248](index=248&type=chunk)[101](index=101&type=chunk)[249](index=249&type=chunk)[97](index=97&type=chunk) - SIGECO acquired Posey Solar (**191 MW solar**) for **$357 million**, placed in service Q2 2025, with costs recovered through base rates. Indiana Electric terminated two solar PPAs due to delays/cost increases but has approved wind PPAs for future operation[250](index=250&type=chunk)[214](index=214&type=chunk)[252](index=252&type=chunk)[253](index=253&type=chunk)[254](index=254&type=chunk)[255](index=255&type=chunk)[256](index=256&type=chunk) - Construction of **two 230 MW natural gas combustion turbines** for Indiana Electric is underway, with the first placed in service Q2 2025 and the second expected Q3 2025. Houston Electric's Stewart-West Bay Transmission Project (**$105 million**) is expected to be approved in Q3 2025[257](index=257&type=chunk)[258](index=258&type=chunk) - New Texas legislation (HB 4384, SB 231, SB 1963, SB 482) impacts LDC cost recovery, temporary generation unit types, securitization of storm costs, and penalties for assaulting utility workers. CenterPoint Energy's solar projects face **delays and cost increases** due to tariffs and supply chain issues[260](index=260&type=chunk)[259](index=259&type=chunk) - Houston Electric reached a settlement for its Transmission and Distribution System Resiliency Plan (SRP) for approximately **$3.18 billion** in distribution-related investments. CERC's Minnesota Gas Rate Case settlement was approved, and Houston Electric's Rate Case settlement was approved[261](index=261&type=chunk)[263](index=263&type=chunk)[264](index=264&type=chunk) Significant Rate Change Applications (Pending or Completed in 2025) | Mechanism | Annual Increase (Decrease) (in millions) | Filing Date | Effective Date | Approval Date | | :--------------------------------------- | :------------------------------------- | :---------- | :------------- | :------------ | | Houston Electric Rate Case | $(47) | March 2024 | April 2025 | March 2025 | | Houston Electric TCOS | $64 | February 2025 | April 2025 | April 2025 | | Houston Electric DCRF | $123 | February 2025 | July 2025 | June 2025 | | CERC Minnesota Gas Rate Case | $104 | November 2023 | September 2025 | July 2025 | | CenterPoint Energy CSIA (Indiana South) | $2 | April 2025 | TBD | TBD | | CenterPoint Energy CSIA (Indiana North) | $9 | April 2025 | TBD | TBD | | CenterPoint Energy Rate Case (Ohio) | $100 | October 2024 | TBD | TBD | [Tariffs](index=79&type=section&id=Tariffs) - The U.S. government imposed new tariffs (e.g., **25% on steel imports in March 2025, 10% baseline on all imports in April 2025**), and potential retaliatory measures create uncertainty, may increase commodity costs, impact supply chains, and contribute to inflation[270](index=270&type=chunk) [Greenhouse Gas and Climate-Related Regulation and Compliance (CenterPoint Energy)](index=79&type=section&id=Greenhouse%20Gas%20and%20Climate-Related%20Regulation%20and%20Compliance) - The EPA proposed to **repeal all GHG emissions standards** for the power sector under Section 111 of the Clean Air Act[271](index=271&type=chunk) - The SEC voluntarily **delayed the implementation of its climate disclosure rules** due to litigation and subsequently voted to **end the defense of these rules**[272](index=272&type=chunk)[273](index=273&type=chunk) [Climate Risk Trends and Uncertainties](index=80&type=section&id=Climate%20Risk%20Trends%20and%20Uncertainties) - Changes in the U.S. presidential administration and expected increases in electric demand have shifted the energy landscape, with executive orders aiming to increase investment in fossil fuel infrastructure[274](index=274&type=chunk) - The OBBBA includes changes to energy tax credits, including accelerated phase-outs, creating uncertainty regarding future renewable generation infrastructure development and the role of existing renewable generation[274](index=274&type=chunk) [Other Liquidity and Capital Factors](index=80&type=section&id=Other%20Liquidity%20and%20Capital%20Factors) Credit Facilities Utilization (July 21, 2025) | Registrant | Size of Facility (in millions) | Amount Utilized (Commercial Paper) (in millions) | | :----------------- | :----------------------------- | :----------------------------------------------- | | CenterPoint Energy | $2,400 | $1,751 | | CenterPoint Energy (SIGECO) | $250 | $0 | | Houston Electric | $300 | $0 | | CERC | $1,050 | $187 | | **Total** | **$4,000** | **$1,938** | - Houston Electric had **$396 million** in money pool borrowings as of July 21, 2025, with a weighted average interest rate of **4.63%**[283](index=283&type=chunk) Credit Ratings (July 21, 2025) | Registrant | Borrower/Instrument | Moody's Rating/Outlook | S&P Rating/Outlook | Fitch Rating/Outlook | | :----------------- | :------------------------------------ | :--------------------- | :----------------- | :----------------- | | CenterPoint Energy | Senior Unsecured Debt | Baa2/Negative | BBB/Negative | BBB/Stable | | CenterPoint Energy | SIGECO Senior Secured Debt | A1/Stable | A/Negative | n/a | | Houston Electric | Senior Secured Debt | A2/Negative | A/Negative | A/Negative | | CERC | CERC Corp. Senior Unsecured Debt | A3/Stable | BBB+/Negative | A-/Stable | - A decline in credit ratings could increase borrowing costs and cash collateral requirements (up to **$289 million** for CERC if ratings drop below investment grade)[288](index=288&type=chunk)[289](index=289&type=chunk) - CenterPoint Energy's 10-year capital plan has increased to approximately **$53 billion through 2030**, and the company plans to sell its Ohio natural gas LDC business[292](index=292&type=chunk)[293](index=293&type=chunk) - Houston Electric's ability to collect receivables from REPs is crucial; PUCT regulations allow deferral of bad debts from REP defaults for future recovery[294](index=294&type=chunk) - Other factors affecting cash requirements include cash collateral for contracts, accelerated payment dates on gas supply, increased costs from tariffs, interest expense increases, regulatory actions, litigation, pension contributions, and natural disaster restoration costs[295](index=295&type=chunk) [Critical Accounting Policies](index=84&type=section&id=CRITICAL%20ACCOUNTING%20POLICIES) - There have been **no material changes** to the critical accounting policies reported in the Registrants' combined 2024 Form 10-K[299](index=299&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=84&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) This section addresses market risk disclosures, with Houston Electric and CERC utilizing a reduced disclosure format, while CenterPoint Energy manages interest rate risk through a combination of fixed and variable rate debt and interest rate swaps, detailing the impact of potential interest rate changes on its floating rate obligations and the fair value of its fixed-rate debt - Houston Electric and CERC use a **reduced disclosure format** for market risk as wholly-owned subsidiaries[300](index=300&type=chunk) - As of June 30, 2025, CenterPoint Energy's floating rate obligations aggregated **$2.5 billion**; a **100 basis point increase** would raise annual interest expense by approximately **$25 million**[303](index=303&type=chunk) - CenterPoint Energy had **$19.2 billion** in fixed-rate debt (principal amount) with a fair value of **$18.3 billion** as of June 30, 2025. A **10% decline in interest rates** would increase the fair value of these instruments by approximately **$748 million**[304](index=304&type=chunk) [Item 4. Controls and Procedures](index=85&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms that management, including the principal executive and financial officers, concluded that the disclosure controls and procedures were effective as of June 30, 2025, and that no material changes in internal controls over financial reporting occurred during the three months ended June 30, 2025 - The principal executive officer and principal financial officer concluded that **disclosure controls and procedures were effective** as of June 30, 2025[305](index=305&type=chunk) - **No material changes** in the Registrants' internal controls over financial reporting occurred during the three months ended June 30, 2025[306](index=306&type=chunk) [PART II. OTHER INFORMATION](index=85&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Item 1. Legal Proceedings](index=85&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 11(d) of the Interim Condensed Financial Statements and relevant sections within 'Management's Discussion and Analysis' for detailed descriptions of material legal and regulatory proceedings, including environmental legal proceedings - For a description of material legal and regulatory proceedings, including environmental legal proceedings, refer to Note 11(d) to the Interim Condensed Financial Statements and 'Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Future Sources and Uses of Cash' and '— Regulatory Matters'[308](index=308&type=chunk) [Item 1A. Risk Factors](index=85&type=section&id=Item%201A.%20Risk%20Factors) This section states that there have been no material changes to the risk factors previously disclosed in the Registrants' combined 2024 Form 10-K - There have been **no material changes** from the risk factors disclosed in the Registrants' combined 2024 Form 10-K[309](index=309&type=chunk) [Item 5. Other Information](index=85&type=section&id=Item%205.%20Other%20Information) This section reports that no director or officer of CenterPoint Energy, Houston Electric, or CERC adopted or terminated a 'Rule 10b5-1 trading arrangement' or 'non-Rule 10b5-1 trading arrangement' during the three months ended June 30, 2025 - **No director or officer** of CenterPoint Energy, Houston Electric, or CERC adopted or terminated a 'Rule 10b5-1 trading arrangement' or 'non-Rule 10b5-1 trading arrangement' during the three months ended June 30, 2025[310](index=310&type=chunk) [Item 6. Exhibits](index=85&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including various agreements, corporate governance documents, and confirmations of forward sale transactions, noting that certain long-term debt instruments are omitted if their authorized amount does not exceed 10% of the Registrants' total consolidated assets - Exhibits include the Asset Purchase Agreement (2.1), Restated Articles of Incorporation (3.1), Bylaws (3.6), and Confirmations of Forward Sale Transactions (10.1-10.6)[313](index=313&type=chunk)[314](index=314&type=chunk) - Certain long-term debt instruments are omitted if the total amount of securities authorized does not exceed **10% of the Registrants' total consolidated assets**[312](index=312&type=chunk) [Signatures](index=88&type=section&id=SIGNATURES) This section contains the official signatures for the Form 10-Q, confirming its submission on behalf of CenterPoint Energy, Inc., CenterPoint Energy Houston Electric, LLC, and CenterPoint Energy Resources Corp. by Kristie L. Colvin, Senior Vice President and Chief Accounting Officer, on July 24, 2025 - The report is signed by Kristie L. Colvin, Senior Vice President and Chief Accounting Officer, on behalf of all three registrants[318](index=318&type=chunk) - The report was signed on July 24, 2025[318](index=318&type=chunk)

Core Insights - CenterPoint Energy has achieved a significant reduction in electric service outage minutes, with a decrease of approximately 45% through June 30, 2025, compared to the same period in 2024 [1][4] - The company has implemented a series of resiliency actions as part of its Greater Houston Resiliency Initiative (GHRI) to enhance the reliability of its electric system [1][3] Reliability Improvements - Customers in the Greater Houston area experienced over 20 million fewer outage minutes per month, reflecting a 45% reduction in the duration of outages for individual customers [4] - Year-to-date outage minutes have decreased by 41 million compared to the five-year average since 2020 [4] Vegetation-Related Outages - There has been a 33% reduction in outages related to trees, branches, and other vegetation contacting electrical equipment compared to the same time period in 2024 [2][4] Investment and Future Plans - CenterPoint has committed to a $3.2 billion Systemwide Resiliency Plan (SRP) aimed at improving resiliency against extreme weather and reducing outages by nearly 1 billion minutes by 2029 [5] - The company is focused on building the most resilient coastal grid in the country through ongoing long-term investments [5] Actions Taken - Key actions include the installation of over 32,000 stronger, storm-resilient poles, clearing hazardous vegetation near more than 7,000 miles of power lines, and installing over 5,150 automation devices capable of self-healing [8]

Core Viewpoint - CenterPoint Energy has appointed Jesus Soto Jr as the Chief Operating Officer, indicating a strategic move to enhance operational leadership within the company [1] Company Summary - The appointment of Jesus Soto Jr is expected to strengthen the operational framework of CenterPoint Energy, reflecting the company's commitment to effective management and leadership [1]