Entergy Louisiana, LLC COLLATERAL TR MT Q2 FY2025 earnings call

• Customer Service: Achieved first quartile Net Promoter Score for utility residential service over 12 months using J.D. Power data.
• Industrial Growth: Robust customer pipeline including data centers and traditional industrial segments; secured significant new growth in Arkansas with expected 4-year industrial sales growth rate of ~13%.
• Capital Plan: Updated 4-year capital plan to $40 billion, including investments in customer-driven generation (3 GW solar, 1.4 GW battery storage, 8 GW gas units). Secured power island equipment for 15 combined cycle and 2 simple-cycle combustion turbines.
• Storm Resilience: Executing Phase 1 of accelerated resilience program with over $2 billion approved, mostly in Entergy Louisiana; invested ~$400 million, including new substations and hardened poles. Texas submitted application for $200 million resilience projects.
• Sale of Gas LDC: Completed sale of gas LDC businesses to Delta Utilities on July 1, allowing focus on core electric business.
• Nuclear Operations: Waterford 3 refueling outage wrapped up on time and budget; planned turbine rod replacements in ANO 1 in fall 2025.
• Regulatory Progress: Reached stipulated settlement with Louisiana PSC staff for Meta's Hyperion data center investment; Mississippi PSC approved Entergy Mississippi's formula rate plan; Louisiana and Texas implemented new storm response processes.
• Community Involvement: Named top 50 most community-minded company and leader in utility sector; employees and retirees contributed over 122,000 volunteer hours in 2024.
• Board Update: Lewis Ropp elected to Board of Directors.

Entergy's adjusted earnings per share for the second quarter was $1.05. The electric business is the core segment. The company sold its gas LDC businesses to Delta Utilities, allowing focus on the core electric business. Industrial sales growth was significant, with close to 12% growth from new and expansion customers. Weather-adjusted retail sales growth for the quarter was 4.5%, with industrial sales being the largest contributor to this growth.

• 2025: Adjusted EPS of $1.05 is on track with guidance; other O&M expected to be ~$0.05 higher in Q3 than last year, and Entergy Texas to have higher MISO capacity costs totaling ~$0.06.
• Longer-Term: Increased 4-year capital plan; affirmed 2026 adjusted EPS unchanged; increased 2027 by $0.05 and 2028 by $0.10; updated tax credit forecasts with nuclear PTCs recognized and adjusted timing of renewable tax credit monetization.

• Storms: Continued risk to infrastructure along the coast, although efforts to reduce storm risk are ongoing.
• Supply Chain: Potential challenges with supply chain for gas plant construction.
• Regulatory: Uncertainties in regulatory approvals and changes, such as those from executive orders.
• Nuclear Construction: Uncertainties around managing construction risk for new nuclear units and securing appropriate support for risk profile.

Q: Jeremy Tonet from JPMorgan asked about color on Arkansas customer industry, ramp, and post-2028 sales growth.

A: Drew Marsh said they can't speak specifically about customers but filings should be out in 2-3 weeks with details.

Q: Nicholas Campanella from Barclays asked about Meta's Hyperion upsizing regulatory process and new nuclear.

A: Drew Marsh said they haven't started the process for upsizing and can't comment on new nuclear specifics, but they're working on managing construction risk.

Q: Julien Dumoulin-Smith from Barclays asked about gas generation upside and timing.

A: Drew Marsh said the 8 GW in capital plan is clear, additional 7 GW would come online between 2029-2031.

Q: Bill Appicelli from UBS asked about equity needs and Arkansas tariff structure.

A: Kimberly Fontan said they manage equity needs within a framework, and Arkansas legislation provides a mechanism for timely recovery of large transmission and generation costs.

Q: David Arcaro from Morgan Stanley asked about operating cash flow outlook drivers.

A: Kimberly Fontan said riders and nuclear PTCs are primary drivers.

Q: Ross Fowler from Bank of America asked about MISO MTEP process and Meta approval intervenor concerns.

A: Drew Marsh said next submittal is in fall, and intervenor concerns are about how and where to manage new assets.

Q: Steve Fleishman from Wolfe Research asked about storm recovery and rating agencies.

A: Drew Marsh deferred to Kimberly on rating agencies, and Kimberly said rating agencies view storm recovery improvements positively.

Q: Sophie Karp from KeyBanc Capital Markets asked about storms and data center coexistence.

A: Drew Marsh said data center customers are located further from the coast, and projects are built to modern standards.

Q: Anthony Crowdell from Mizuho asked about new nuclear deal options.

A: Drew Marsh said they're talking to various parties but haven't cracked the nut yet.

Q: Angie Storozynski from Seaport Research Partners asked about residential sales and gas plant costs.

A: Kimberly Fontan said residential sales variances are not a long-term pattern, and they manage gas plant costs through continuous improvement.

Q: Paul Patterson from Glenrock Associates asked about executive order and safe harboring.

A: Kimberly Fontan said they're engaged but have no specific insights on executive order outcomes.