Company Overview - CenterPoint Energy, Inc. is a multi-state electric and natural gas delivery company serving approximately 7 million metered customers across Indiana, Minnesota, Ohio, and Texas [1] - The company is headquartered in Houston and is the only Texas-domiciled investor-owned utility [1] - As of June 30, 2025, CenterPoint Energy had approximately $44 billion in assets [1] - The company employs around 8,300 individuals and has been serving customers for over 150 years [1] Upcoming Investor Update - An investor update is scheduled for September 29, 2025, at 3:30 p.m. Central time or 4:30 p.m. Eastern time [1] - The update can be accessed via the internet at the CenterPoint Energy investor relations website [1]

Core Viewpoint - CenterPoint Energy is actively monitoring a tropical disturbance (Invest 98L) that may impact the Greater Houston area with increased rain chances by the end of the week [1][3]. Group 1: Storm Preparedness - CenterPoint has a summer storm readiness plan in place and is prepared to take action if the disturbance strengthens or changes its projected path [2][3]. - The company has executed a series of resiliency improvements in the Greater Houston area since Hurricane Beryl, including the installation of over 32,000 stronger poles and the undergrounding of more than 400 miles of power lines [4][5]. Group 2: Communication and Customer Engagement - CenterPoint encourages customers to sign up for the Power Alert Service to receive updates on outages and restoration efforts [8]. - The company is conducting outreach to critical care customers and providing safety information through various channels to keep the public informed [5][9]. Group 3: Weather Monitoring - More than 100 weather monitoring stations have been installed across the Greater Houston area to enhance situational awareness and storm preparation [6]. - These stations measure various weather parameters every 2-5 minutes, including humidity, wind speed, temperature, and rainfall [6]. Group 4: Company Overview - CenterPoint Energy, Inc. serves approximately 7 million metered customers across multiple states and has approximately $44 billion in assets as of June 30, 2025 [11]. - The company has been in operation for over 150 years and is headquartered in Houston, Texas [11].

Industry Overview - The Utility – Electric Power industry is transitioning to cleaner fuel sources and reducing carbon emissions, supported by government policies promoting sustainable power generation [1] - Utilities are investing in grid upgrades and improving transmission and distribution infrastructure to enhance resilience against severe weather events [1][3] - The industry is experiencing stable demand across economic cycles, with increased electricity consumption during extreme weather [3] Trends Impacting the Industry - Interest rates have declined from 5.25-5.50% to 4.25-4.50%, benefiting capital-intensive utilities by lowering borrowing costs for infrastructure investments [4] - Electricity production is projected to increase by 2.2% in 2025 and 2.3% in 2026, reaching 4,340 billion kilowatt-hours, driven by demand from commercial and industrial sectors [5] - The share of electricity generation from renewable sources is expected to rise from 23% in 2024 to 26% in 2026, aided by the Inflation Reduction Act [6] Company Highlights - CenterPoint Energy Inc. plans to invest $53 billion over the next 10 years to expand operations and meet rising electricity demand [19] - Fortis Inc. expects to invest $26 billion from 2025 to 2029, focusing on strengthening regulated electric and gas operations [23] - NiSource Inc. projects an investment of $19.4 billion for 2025-2029 to enhance its existing operations [27] Financial Performance and Valuation - The Utility Electric Power industry has gained 16.9% over the past 12 months, outperforming its sector's 14.2% increase but lagging behind the S&P 500's 22.7% gain [10] - The industry is currently trading at an EV/EBITDA of 14.37X, lower than the S&P 500's 17.02X and the Utility sector's 15.75X [13] - Long-term earnings growth estimates for CenterPoint Energy, Fortis, and NiSource are 7.8%, 5.13%, and 7.88% respectively, with respective dividend yields of 2.3%, 3.53%, and 2.58% [20][24][28]

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)