Good morning, ladies and gentlemen, and welcome to Alliant Energy's Conference Call for First Quarter 2020 Results. This call is being recorded for rebroadcast. At this time, all lines are in a listen-only mode. I would now like to turn the call over to your host, Susan Gille, Investor Relations Manager at Alliant Energy.

Good morning. I would like to thank all of you on the call and the webcast for joining us today. We appreciate your participation. Joining me on this call are John Larsen, Chairman, President and Chief Executive Officer; and Robert Durian, Executive Vice President and CFO. Following prepared remarks by John and Robert, we will have time to take questions from the investment community. We issued a news release last night, announcing Alliant Energy's first quarter financial results and reaffirmed the consolidated 2020 earnings guidance range issued in November 2019. This release, as well as supplemental slides that will be referenced during today's call are available on the investor page of our website at www.alliantenergy.com. Before we begin, I need to remind you the remarks we make on this call and our answers to your questions, include forward-looking statements. These forward-looking statements are subject to risks that could cause actual results to be materially different. Those risks include among others, matters discussed in Alliant Energy's press release issued last night, and in our filings with the Securities and Exchange Commission. We disclaim any obligation to update these forward-looking statements. In addition, this presentation contains references to non-GAAP financial measures. A reconciliation between non-GAAP and GAAP measures are provided in the earnings release and our 10-Q, which will be available on our website at www.alliantenergy.com. At this point, I'll turn the call over to John.

Thank you, Sue. Good morning, everyone, and thank you for joining us. I’ll start with a review of several actions we have taken to continue our critical service to our customers and communities during the current pandemic. I’ll draw your attention to slide 2. These are indeed unprecedented times and brings to life the values that guide our every decision. One of those values is caring for others. We understand the responsibility that comes with the essential service we provide. The Alliant Energy team has taken steps to continue safe and reliable service to our customers and communities. We are focused now more than ever to ensure uninterrupted energy delivery. So those on the front lines can help those in need businesses can operate and provide critical products and services. Charitable organizations can support those most vulnerable, and our customers can focus on their health and well-being. Like many of you, we’ve adjusted the way we work and many of our employees now work from home. We’ve made changes to our operations to ensure we can safely keep the lights on and the gas flowing. We are following the important guidance from the CDC, maintaining physical distancing and adding additional precautions like wearing face coverings and gloves, when the situation requires. And we are rotating shifts for certain functions to limit exposure and business disruption. Another one of our core values is to do the right thing. Temporarily suspending disconnections and waiving late fees for our customers was the right thing to do. In addition, we knew that now was the time for a creative way to keep rates low and predictable for our customers. We filed a proposal in Wisconsin to keep customer rates steady through the end of 2021. This filing is a continuation of our ongoing efforts…

Thanks John. Good morning everyone. Yesterday, we announced first quarter 2020 GAAP earnings of $0.70 per share, compared to $0.53 per share in the first quarter of 2019. Our utilities had higher earnings year-over-year, driven by higher electric and gas margins from increasing rate base and timing of income tax expense. These increases in earnings were partially offset by lower sales due to the warmer winter temperatures in the first quarter and higher depreciation expense. We have provided additional details on the earnings variance drivers for the quarter on slides 3 and 4. The solid start to the year accounts for approximately 30% of our 2020 earnings targets and allows us to reaffirm our 2020 earnings guidance of $2.34 per share to $2.48 per share. The key drivers of the growth in 2020 EPS are related to investments in our core utility business including WPL’s West Riverside generating facility and IPL’s wind expansion program. These investments were reflected in IPL’s and WPL’s approved electric rates for 2020. As John indicated, like many of our utility peers, we are expecting lower retail sales in 2020 due to the impacts of the pandemic. As noted on Slide 5, we experienced a 4% increase in residential sales in April, driven largely by more people working from home. Our residential customers represent nearly 50% of our retail electric margins and every 1% change in residential sales equates to approximately $0.02 of earnings per share. On the commercial and industrial side, the story is different. C&I sales decreased by 13% in April and every 1% change in annual C&I sales equates to approximately $0.02 of EPS. Under an assumption, that the more significant pandemic-related sales declines extend through the end of the second quarter, and a slower recovery through the end of the year, we…

[Operator Instructions] Our first question today comes from Julien Dumoulin-Smith of Bank of America.

Hi, good morning. This is Alex Morgan calling in for Julien. Thank you so much for taking my question and congratulations on the results.

Good morning. Thanks, Al.

No problem. So, I want to check in specifically on O&M. I know that, you mentioned in the prepared remarks, a little bit about some expenses that you are going to cut to be able to balance under the COVID impacts. But I was wondering if you could talk really specifically about O&M and how you were factoring that in originally in 2020 and then, maybe the year-over-year expectation now? Thank you so much.

Sure. Great, Alex. So, we had a number of items that bringing 580 megawatts of wind or Riverside. So we had some O&M increases in coming into 2020 and we had some offsets as well. So we were expecting it to be relatively flat coming into the year. Certainly, with the COVID impacts, we know, we have to further reduce – the good news here is, we had a lot of work internally on planning for cost reduction. So we will see some acceleration of plans that we had. Certainly this isn’t the first time we had to react for our company during economic downturns. So we will take a look, there are a number of levers that we have to reduce costs. So we would see addressing that here – this year and maybe for a few more details, I’ll see if Robert wants to add a couple of points.

Yes, Alex. Maybe to give you some sense, so coming into the year, we expected as John indicated, maybe just a slight decrease in O&M, but we are going to benefit from the fact that our pension costs are expected to be lower in 2020, largely because of the favorable returns we saw in 2019. And as John indicated, the remainder of the decrease was largely related to elimination of discretionary spending. Think of that as cost we incur for travel and employee expenses that have been suspended at a point in time, as well as some contractors that we are no longer going to pursue. And then, as John also indicated, part of that is acceleration in some of the planned transformation activities where we are going through and reevaluating processes across the organization that gained some efficiencies and automate some of our plants. So, we feel well positioned to be able to execute on those and offset these sales declines.

Thank you. And one more question from me. I was wondering around the Wisconsin filings is, you could maybe provide a little more commentary on your expectations if you expect interveners to understand the filing and to largely be okay with that, especially with being able to use some of those fuel savings to balance off the rate base increase. I am definitely interested in hearing about that. And then, potentially any expectation around timing, when we might be able to see final results? And that’s it for me. Thank you so much again.

Yes, great. And certainly important that we may be start out thinking about. We’ve had great productive conversations with our regulators and interveners thinking about getting ready for not only the stabilization filing, but also work that we are doing on our clean energy blueprint. So a lot of work going in and I would say that we’ve always had a very collaborative and transparent process. So, there are a number of levers and as we put forward, now is the right time to think about introducing a couple of these important projects, our Kossuth project namely is one of those that would be able to put forward, as well as our West Riverside. And then have a number of these offsets that could keep customer rates flat. So we’ve had a lot of productive discussions, felt that went well, and we appreciate that. And as far as timing, Alex, I would – I think we are looking at maybe roughly third quarter and timing obviously that’s subject to making sure we have all the information and respond to questions that the regulators have. But we feel comfortable with the filing. We think it’s the right thing to do for customers.

Thank you very much. Have a great day.

Our next question comes from Andrew Weisel of Scotiabank.

Hi, good morning everyone.

Good morning, Andrew.

First question on the WPL filing. Can you give a little more specific, there is a comment in the slide and in the filing about using regulatory mechanisms to address estimated COVID impacts on 2021 sales? Can you just dig a little deeper into that in terms of how you would quantify that? I believe that's not adjusting for weather, just COVID specifically, right?

That is correct. And so part of our filing requested the ability to go back into the later dates and potentially use some of the regulatory liabilities that we've accumulated through cost reductions including fuel cost sharing mechanisms and ROE sharing mechanisms to be able to offset any potential impacts on 2021 sales demand because of COVID-19. Because we don’t know the exact impacts from that yet next year, we’ll likely able to tell – again probably later into the year. We just asked for the ability to come back into the later point of addressing them.

Okay. Got it. Thank you. And then the next question I had was I believe you said you are expecting you are expecting a 5% overall reduction in sales this year from COVID-19. Can you break that up by customer class for us?

Yes, I think you could probably look very – at the slide that we put out there, it has the breakdown between the increase in the residential sales and the decrease in commercial and industrial sales. So think of that profile is pretty consistent. So we do expect some increase in the residential side and then the opposite to the commercial and industrial segment. Residential is probably going to be a net 3% to 5% positive and the commercial and industrial are likely be around the 10% to 13% that that we identified.

Well, then just the math of it, would that suggest it would be down 9% for the full year?

Yes, that's just for the second quarter and then will have a slow recovery through the remainder of the year. So you can look at the direction on the residential.

Yes, Andrew, John here. Certainly, we see minimal – as we noted minimal in Q1. We certainly see Q2 as being the major impact right now and then having a gradual, but slow trajectory for the balance of the year. Certainly recognize that's not necessarily going to be linear. We know there is going to be some ups and downs. So we've done quite a bit of scenario planning and think of it as an aggregate of a number of what if plans put together as Robert noted, then comes to around that 5% overall decline.

Okay. Got it. Thank you very much.

You are welcome.

And our last question today comes from Michael Sullivan of Wolfe Research.

Yes. Hey. Good morning everyone. Hope you are all well.

Yes, thanks, Michael. Hope you are as well.

Thanks. Yes. Just on the 2020 guidance, I think last quarter, you guys indicated that you were tracking to the upper end of the range and just wanted to confirm whether that's still the case? Or if you are able to indicate where within a range kind of post what you're seeing on the COVID side of things?

Yes. Great question. Thanks, Michael. One thing to keep in mind. We do have our range and guidance weather-normalized. So this is important to keep that in mind. But as we thought about reaffirming and we certainly have a target for being at the midpoint of that guidance, weather-normalized.

Okay. So weather-normal but not normalizing for COVID?

Correct. We do plan on offsetting the COVID-19 impacts. So at the end of the year when you look at our temperature-normalized non-GAAP EPS, we'll be targeting that midpoint of the current guidance range of 2.1.

And just curious , and in one of the footnotes on the rate filing indicated, assuming that WEC and GE won't exercise your options in West Riverside. Have they given you that indication? Or is that just kind of the mechanics here? You guys are assuming that? Or just any color on the expectation on that front?

Yes, Michael, just based on the timing for this one year stabilization. Nothing more than it is a base timing assumption.

Okay. That was all for me. Thanks a lot. Be well.

Right. Thank you.

With no more questions, this concludes our call. A replay will be available through May 17, 2020 at 888-203-1112, for US and Canada, or 719-457-0820 for international. Callers should reference conference ID 4175543 and pin 9578. In addition, an archive of the conference call and a script of the prepared remarks made on the call will be available on the investor’s section of the company’s website later today. We thank you for your continued support of Alliant Energy and feel free to contact me with any follow-up questions.