PNM Resources : Q1 2024 Presentation and Appendix

Q1 2024 Earnings Review

April 30, 2024

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Safe Harbor Statement

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995

Statements made in this news release for PNM Resources, Inc. ("PNMR"), Public Service Company of New Mexico ("PNM"), or Texas-New Mexico Power Company ("TNMP") (collectively, the "Company") that relate to future events or expectations, projections, estimates, intentions, goals, targets, and strategies, including the unaudited financial results and earnings guidance, are made pursuant to the Private Securities Litigation Reform Act of 1995. Readers are cautioned that all forward-looking statements are based upon current expectations and estimates and apply only as of the date of this report. PNMR, PNM, and TNMP assume no obligation to update this information. Because actual results may differ materially from those expressed or implied by these forward-looking statements, PNMR, PNM, and TNMP caution readers not to place undue reliance on these statements. PNMR's, PNM's, and TNMP's business, financial condition, cash flow, and operating results are influenced by many factors, which are often beyond their control, that can cause actual results to differ from those expressed or implied by the forward-looking statements. For a discussion of risk factors and other important factors affecting forward-looking statements, please see the Company's Form 10-K, Form 10-Q filings and the information included in the Company's Forms 8-K with the Securities and Exchange Commission, which factors are specifically incorporated by reference herein.

Non-GAAP Financial Measures

For an explanation of the non-GAAP financial measures in this presentation (ongoing earnings, ongoing earnings per diluted share and ongoing earnings guidance measures), as well as a reconciliation to GAAP measures, please refer to the Company's website at http://www.pnmresources.com/investors/results.cfm. Since the future differences between GAAP and ongoing earnings are frequently outside the control of the Company, management is generally not able to estimate the impact of the reconciling items between forecasted GAAP net earnings and ongoing earnings guidance, nor their probable impact on GAAP net earnings without unreasonable effort, therefore, management is generally not able to provide a corresponding GAAP equivalent for ongoing earnings guidance.

Overview and Highlights

Financial Results and Company Updates

Financial Results and Guidance

Q1 2024 earnings results exceeded expectations

2024 earnings guidance and long-term earnings growth target affirmed

	Q1 2024	Q1 2023	Financial
GAAP EPS Focus$0.52	$0.64
Profile
$0.55
Ongoing EPS	$0.41

• 2024 Ongoing EPS Guidance affirmed $2.65 - $2.75
• 6% - 7% targeted earnings growth 2024 - 2028

Company Updates

NMRD Sale Completed	New Mexico Renewable Development (NMRD)
• Sale completed, proceeds received February 2024

Note: EPS is presented on diluted basis. For a reconciliation of GAAP to Ongoing EPS,	4
including a description of adjustments, see earnings release issued April 30, 2024.

Operational and Regulatory Highlights

TNMP Highlights

ERCOT sees "unprecedented and rapid load growth"

• New report highlights modifications to transmission planning processes to meet the forecasted pace of load growth and adapt to the changing grid

West Texas Transmission

• Current: ERCOT approval for $100M reliability project
• • Project included in current investment plans
• Future: ERCOT developing Permian Basin plans for PUCT consideration
• • Incremental to current investment plans

System Resiliency Plan

• To be filed Q3 2024
• $450 million included in current investment plans
• Deferral of depreciation expense
• Opportunities for cost recovery of increased wildfire mitigation plans

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PNM Highlights

Public Safety Power Shutoff (PSPS)

• Formalization of plan with conditions for preventive shutoffs
• • Hazardous Fire Areas identified and monitored for conditions beginning 7-10 days out, weather is not the only factor, communications are key
• Community outreach and engagement for local preparation
• To be filed with New Mexico Public Regulation Commission (NMPRC) May 1

Resource portfolio reaches 60% carbon-free

• Integration of 300 MW solar purchase agreements
• Additional solar and battery storage resources previously approved to be integrated 2024-2026, including 12 MW distribution battery storage

NMPRC Workshops and Presentations

• Resource Adequacy / System Preparedness
• Grid Modernization / Distribution Planning
• Regional Markets

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TNMP and PNM Regulatory Updates

TNMP

Transmission Cost of Service	• 1st 2024 filing approved March 2024, recovering $97M
incremental rate base
(TCOS) recovery
• 2nd 2024 filing expected in Q3 2024 for implementation in 2024
Distribution Cost Recovery	• 1st 2024 filing submitted April 2024 to recover $200M
incremental rate base
Factor (DCRF) recovery
• 2nd 2024 filing expected in Q3 2024
PNM
	• 100 MW solar purchase agreements, 250 MW battery storage
2026 Resource Adequacy Filing	agreements, 60 MW utility-owned battery
	• Decision expected Q2 2024
	• Includes smart meter investment
Grid Modernization	• Hearings held on supplemental Cost Benefit Analysis, decision
	expected by Q3 2024

2025 Rate Change	• Expect to file in early June 2024 for rates implemented July 2025
• Future test year July 2025 - June 2026

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Financial Updates

Highlights of Q1 2024 Ongoing Earnings Results

Q1 2024 changes in ongoing earnings:

• Rate recovery through TNMP TCOS and DCRF rate mechanisms and implementation of new retail rates at PNM
• Improved market performance of PNM decommissioning trust
• PNM load growth, partially offset by a return to normal weather
• Expected reduction in PNM transmission margins from elevated Q1 2023 levels
• Depreciation and interest expense associated with new capital investments at PNM and
  TNMP

Q1 Earnings Summary

$0.55 Clean Energy	($0.17)	Strong Financial
$0.05
Focus			Profile
TNMP
			($0.02)	$0.41

PNM Corporate

Q1 2023		Q1 2024
	EPS Summary	Q1 2023	Q1 2024
	PNM Resources	$0.55	$0.41
	PNM	$0.55	$0.38
	TNMP	$0.11	$0.16
	Corporate/Other	($0.11)	($0.13)

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Note: Detailed EPS drivers available in appendix