Q2 2020 Earnings Review July 31, 2020 Safe Harbor Statement Safe - - PowerPoint PPT Presentation

Q2 2020 Earnings Review

July 31, 2020 November 1, 2019

Safe Harbor Statement

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 Statements made in this presentation for PNM Resources, Inc. (“PNMR”), Public Service Company of New Mexico (“PNM”) and Texas-New Mexico Power Company (“TNMP”) (collectively, the “Company”) that relate to future events or expectations, projections, estimates, intentions, goals, targets, and strategies 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. The Company assumes no obligation to update this information. Because actual results may differ materially from those expressed or implied by these forward-looking statements, the Company cautions readers not to place undue reliance on these statements. The Company’s business, financial condition, cash flow, and operating results are influenced by many factors, which are often beyond its 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 and Form 10-Q filings and the information filed on 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 that appear on certain slides 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 as follows: http://www.pnmresources.com/investors/results.cfm.

2

Overview

Pat Vincent-Collawn

Chairman, President and CEO

Q2 2020 Financial Results and Regulatory Highlights

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Clean Energy Focus Strong Financial Profile

Q2 2020: COVID-19 load decline offset by warmer than normal temperatures across New Mexico and Texas Financial Results

• 2020 Ongoing EPS Guidance affirmed $2.16 - $2.26

Regulatory Highlights

PNM

• San Juan replacement power decision provides clear path

to clean energy goals

• Decoupling: procedural schedule supports 2020 decision

with hearings planned for October

• Approval of regulatory asset treatment for COVID-19

related expenses TNMP

• DCOS settlement of $14.3M, reflects 97% of filed request
• TCOS filing (second filing of 2020) of $2.0M

Note: 2020 EPS presented on diluted basis, 2019 EPS presented on non-diluted basis due to GAAP net loss; for a reconciliation of GAAP to Ongoing EPS, including a description of adjustments, see earnings release issued July 31, 2020

Q2 2020 Q2 2019 YTD 2020 YTD 2019 GAAP EPS $0.72 ($0.95) $0.53 ($0.72) Ongoing EPS $0.55 $0.38 $0.73 $0.49

Regulatory dockets move forward

COVID-19 Update

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Restrictions continue in New Mexico and Texas in response to rising case numbers during phased re-openings, continue to prioritize the safety of our team, caring for

• ur customers and communities

Phased re-opening began in May and expanded in June; plans suspended in July with some restrictions re-instated Customer disconnects and late fee suspensions continue, regulatory treatment for COVID-19 expenses supports expanded customer payment plans Phased re-opening began May 1st and expanded throughout May and early June; plans suspended and restrictions re-instated in late June following continued growth in case numbers COVID-19 Electricity Relief Program remains in place

Environmental, Social, Governance Strategy

Commitment to ESG Strategy

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Investment plans aligned with ESG strategy Business priorities demonstrate ESG principles Renewed focus on sharing achievements and providing data Environmental leadership

• 100% emissions-free

energy by 2040

• Additional CO2, NOX, SO2,

water reduction goals Exit from coal incorporates a Just Transition Diversity and Inclusion, Fostering Tribal Relationships and COVID-19 response demonstrates core values of Safety, Caring, Personal Integrity and Honest Communication Committed to a clean energy future that supports evolving federal and state policies and integrates emerging technologies Focused on delivering clean energy through grid investments Increase grid reliability, resilience and security to meet the growing needs of existing and new customers affordably Launched redesigned website for ESG Commitment Published 2019 Sustainability Report Planned for 2020:

• SASB and TCFD

disclosure mapping reports

• EEI ESG template

Demonstrating ESG Principles

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SOCIAL ENVIRONMENTAL GOVERNANCE

Significant progress achieved in emissions and freshwater usage Emissions-free by 2040: industry-leading goal for the full elimination of carbon emissions from generation Rapid growth in owned and purchased renewable resources delivered to customers Focus on safety and company culture Fostering tribal relationships through meaningful partnerships Diverse (40% women / 20% minorities), engaged Board with extensive experience Hiring, training, retaining and engaging a diverse workforce (50% minority), promoting diversity and inclusion within our teams and communities Robust top-down ethics program with organization-wide commitment

Additional environmental goals ESG Highlight: Environmental Goals

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Significant emission and freshwater reductions achieved Our goal: 100% emissions-free energy by 2040

• Continues to lead

industry goals with the

FULL ELIMINATION of

carbon emissions from generation by 2040

• More aggressive than

reductions included in the Paris Climate Agreement

• Five years earlier than

New Mexico Energy Transition Act mandate

• 2020 on track to

report reductions achieved through investments and coal unit retirements: CO2: 20% NOX: 50% SO2: 75% Freshwater: 30%

Emission Reduction Goals: Freshwater Reduction Goals:

Note: Reductions measured from 2005 levels, reflect owned generation resources

2025 2035 2040 CO2 60% 80% 100% NOX 70% 90% 100% SO2 90% 90% 100% 2025 2035 2040

Freshwater 70%

80% 90%

A Just Transition ESG Highlight: A Just Transition for San Juan Generating Station

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Customer savings Replacing coal with cleaner energy resources

• Retirement of 562 MW
• f coal-fired generation
• Replacement includes

650 MW of solar and 300 MW of battery storage

• New Mexico

Renewable Portfolio Standards:

• 20% by 2020
• 50% by 2030
• 80% by 2040
• Securitization of

undepreciated investment at lower interest rates results in savings passed on to customers

New Mexico Energy Transition Act includes:

• Job training and

severance costs for utility and coal mine employees

• Economic development

funds to support impacted community

• Replacement power

re-investment in affected school district, provides property tax base

ESG Highlight: Diversity and Inclusion, Tribal Relationships

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Diversity and Inclusion in our Communities Hiring, Training, Retaining and Engaging a Diverse Workforce Overall Workforce: 2019 New Hires:

• Diversity and unconscious

bias training, succession planning, veteran hiring partnerships, pay equity

• Total benefit packages

designed to appeal to a broad base of employees

• Engagement efforts

focused on maximizing inclusiveness

• PNM first to support

local fund launched to support, promote and advance Diversity, Equity and Inclusion practices

• Matching donation

program expanded to

• ffer 2-to-1 matching to

social justice nonprofits and increase annual per-employee matches

Fostering Tribal Relationships

Financial Support

• Native American engineering

internships

• Navajo Nation Workforce

Training Scholarships Program

• Founding partner of Light up

Navajo, energizing homes

COVID-19: Tribal Community Disproportionately Impacted

• Company donations of available

protective equipment and other supplies

• Collaboration to set up wireless

hotspots to aid first responders and support remote education

Minority Women Veterans 50% 26% 8% Minority Women Veterans 57% 37% 8%

Renewed Focus on Sustainability Reporting and ESG Disclosure

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• 2019 Sustainability Report published
• Dedicated portion of website focused on additional reporting and disclosures

at www.pnmresouces.com/ESG-commitment: New 2020 Reporting to include:

• Annual sustainability report
• Mapping reports to TCFD and SASB frameworks
• EEI ESG template

Financial Updates

Q2 2020 Ongoing EPS Financial Summary

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Clean Energy Focus Strong Financial Profile

Year-over-year increase expected largely due to the prior year impacts of mild weather and lower planned outage costs Stronger than expected increase:

• Strong weather in Q2

2020 offset COVID-19 reductions

• Shifting of plant

maintenance costs

$0.15 $0.01 $0.01 $0.38 $0.55 Q2 2019 Q2 2020 PNM TNMP Corporate

Q2 Earnings Summary

COVID-19 Update

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COVID Scenario Analysis Movement through Stages 1 and 2 of original planning analysis with expected load impacts, no significant workforce or supply chain disruptions Current expectations reflect continued load impacts and no significant workforce or supply chain disruptions Stages 1 and 2 Current Expectations

Duration / Economic Conditions (Margin Impact) Increased residential load, reduced commercial/ industrial load due to restrictions Continued load impacts resulting from local restrictions across New Mexico and Texas during phased re-openings Workforce Disruption (Capital Impact) No significant workforce disruptions No significant workforce disruptions Supply Chain Disruption (Capital Impact) No significant supply chain disruption No significant supply chain disruption

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2020 Actuals 2020 Original Guidance 2019 Actuals

Continued COVID-19 Load Impacts

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Q2 results in line with planning assumptions July trends reflect improvement in PNM Commercial load

PNM COVID load trends

• Residential: +5% increase
• UPDATED: Commercial -10% reduction
• PREVIOUS: Commercial -15% reduction

TNMP Demand- Based TNMP Volumetric PNM Volumes

TNMP COVID load trends

• Volumetric: +5% increase
• Demand-based: -5% reduction

Note: Refer to Slide 29 for EPS sensitivities of load impacts under planning assumptions

Weather-normalized load:

2020 Consolidated Ongoing Earnings Guidance

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Clean Energy Focus Strong Financial Profile

$2.16 Consolidated EPS $2.26

PNM $1.67 – $1.73 TNMP $0.72 – $0.74 Corp/Other ($0.23) – ($0.21)

2020 Earnings Guidance

8% 22% 55% 15% 8% 25% 54% 13% Q1 Q2 Q3 Q4 Previous Updated

2020 Annual EPS Distribution by Quarter

$2.16 - $2.26 guidance affirmed, targeting midpoint Stronger contribution in Q2 to be offset by lower contributions in Q3 and Q4, as discretionary plant maintenance was delayed for COVID-19 considerations

Financial Profile Continues to Target 5% - 6% Earnings Growth

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Rate Base Investments Earnings Growth Dividend Growth Liquidity

• $3.3B investment plan 2020 - 2023
• Emphasis on grid infrastructure investments
• Reflects investment opportunities balanced with

long-term customer value

• 5%-6% earnings growth target through 2023
• Dilution of rate base growth resulting from equity is

partially offset by savings from debt refinancings

• Dividend growth to mirror earnings growth
• Quarterly declarations by Board of Directors
• Annual dividend evaluated in December
• Maintain investment grade credit ratings
• Immediate equity needs met through January

2020 forward offering

• Adequate liquidity remains available to

finance business needs

PNM Investment: Wired for the Future

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Clean Energy Focus Strong Financial Profile

Delivering Clean Energy

• Infrastructure expansions to accommodate clean energy resources
• Grid reconfigurations that provide enhanced flexibility
• Sustainable platforms for distributed resources and electric vehicles

Enhancing Customer Satisfaction

• Customer reliability improvements and quality of service enhancement
• Customer products and communication that match expectations
• Infrastructure expansion for emerging new customer growth

Increasing Grid Resilience

• Stabilization of aging asset base through consistent investment
• Grid modernization and enterprise-wide technology improvements
• Enhanced infrastructure and controls to address security, wildfire risks

New Mexico’s clean energy future depends on a reliable, resilient, secure grid to deliver an evolving mix of energy resources to customers

PNM Investment: Wired for the Future

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30% 17% 53% Total Investment by Category

Delivering Clean Energy Enhancing Customer Satisfaction Increasing Grid Resilience

Investments in grid resilience provide the foundation for a system that can respond and adapt to integrate evolving technology and provide long-term customer value

Delivering Clean Energy

• Reconfiguring substations and lines

beyond the original architecture to accommodate growing amounts of intermittent and distributed generation resources Enhancing Customer Satisfaction

• Strengthening infrastructure that directly

serves customers, focus on reliability and outage restoration Increasing Grid Resilience

• Expanding transmission substations and

lines operating at maximum capacity Accelerates $450M Investment 55% Transmission / 45% Distribution

$275 $303 $319 $336

$94 $82 $77 $53 $337 $290 $342 $348 $187 $194 $200 $202 $134 $268 $27 $27 $25 $21 $25 $117 $120 $125

2020 2021 2022 2023

(in millions)

PNM Existing Generation TNMP PNM T&D PNM Transmission Expansion 50% NMRD Renewable Additions Business Technology Services/General Services PNM Wired for the Future Depreciation

$976 $806 $760 $753

$3.3B investment plan supports 5-6% earnings growth target

Wired for the Future investments focused on delivering clean energy future

2020 – 2023 Investment Plan

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(1) Western Spirit acquisition of $285M reflects assumed purchase price of $360M, net of $75M customer funding (2) Depreciation does not include amounts associated with NMRD (2) (1)

2020 - 2023 Potential Earnings Power

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This table is not intended to represent a forward-looking projection of 2021 - 2023 earnings guidance. Refer to Slide 28 for additional details and disclosures.

Earnings Growth Target 5-6% through 2023

Improved earnings outside of rate base offsets the timing of rate base clearings

Note: 5-6% targeted earnings growth CAGR measured from 2019 Ongoing EPS of $2.16. The number of shares outstanding increases from 80M to 86M in December 2020 resulting from the January 2020 forward equity offering

(1) Items not in rates has been updated to reflect interest savings, lower decommissioning costs related to

Palo Verde and the retirement of 65 MW of unregulated generation at San Juan Allowed Return / Equity Ratio

2020 Ongoing Earnings Guidance Midpoint 2021 Earnings Potential 2022 Earnings Potential 2023 Earnings Potential Avg Rate Base Return EPS Avg Rate Base EPS Avg Rate Base EPS Avg Rate Base EPS PNM Retail

9.575% / 50% $2.5 B 9.5% $1.47 $2.5 B $1.41 $2.5 B $1.43 $2.5 B $1.44

PNM Renewable Rider

9.575% / 50% $150 M 9.575% $0.09 $145 M $0.08 $140 M $0.08 $130 M $0.07

PNM FERC

10% / ~50% $0.3 B 7.5% $0.15 $0.5 B $0.20 - $0.23 $0.7 B $0.35 - $0.39 $0.8 B $0.37 - $0.42

Items not in Rates(1)

($0.01) ($0.01) - $0.02 $0.01 - $0.03 $0.03 - $0.06

Total PNM

$3.0 B $1.70 $3.1 B $1.68 - $1.74 $3.4 B $1.87 - $1.93 $3.5 B $1.91 - $1.99

TNMP

9.65% / 45% $1.3 B 9.65% $0.73 $1.5 B $0.79 $1.6 B $0.87 $1.9 B $0.97

Corporate/Other

($0.22) ($0.13) - ($0.11) ($0.13)-($0.11) ($0.15) - ($0.13)

Equity Financing Plans

($0.03) - ($0.01) ($0.11)-($0.09) ($0.11) - ($0.09)

Total PNM Resources

$4.3 B $2.21 $4.6 B $2.31- $2.41 $5.0 B $2.50 - $2.60 $5.4 B $2.62 - $2.74

2019-2023 Rate Base CAGR (2019 base): Total 7.8% / PNM 4.2% / TNMP 16.1%

Questions and Answers

Appendix

PNM and TNMP Regulatory Agenda

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Upcoming activities:

• PNM annual FERC formula rate and PNM annual Renewable plan filings

Filing Action Timing Docket No.

PNM: Decoupling Filing (Petition for Approval of Rate Adjustment Mechanism to Remove Regulatory Disincentives) Filed with the NMPRC on May 28, 2020 Hearings scheduled for October 2020 20-00121-UT Deferral of Incremental costs related to COVID-19 PNM and other utilities filed joint motion April 27, 2020 Approved June 24, 2020 20-00069-UT Consolidated Application for San Juan Generating Station (Abandonment, Securitization and Replacement) PNM filed July 1, 2019; NMPRC bifurcated case; New Mexico Supreme Court ruled January 29, 2020 that Energy Transition Act applies to both dockets. NMPRC order approving abandonment/securitization issued April 1, 2020 NMPRC replacement power order issued July 29, 2020 19-00018-UT 19-00195-UT PNM 2020 Renewable Plan Filing Filed June 1, 2020 Hearings scheduled for September 24-25, 2020 20-00124-UT FERC Transmission Formula Rate Annual Update Filed June 1, 2020 Informational filing submitted; rates effective June 1, 2020 N/A Solar Direct Program Filed May 31, 2019 for approval of voluntary renewable program expected to begin March 31, 2021; Hearings completed January 2020 Approved March 25, 2020 19-00158-UT TNMP: DCOS Filing Filed April 6, 2020; settlement filed June 26, 2020 Rates expected to be implemented September 1, 2020 50731 TCOS Filing (second 2020 filing) Filed July 24, 2020 Rates expected to be implemented September 2020 51107

Q2 2020 vs Q2 2019 EPS (Ongoing): PNM

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Clean Energy Focus Strong Financial Profile PNM

• Weather and retail load: Higher

than normal temperatures in Q2 2020 compared to significantly milder weather in Q2 2019 resulted in higher residential load, partially offset by reduced commercial usage resulting from COVID-19 business restrictions

• Lower plant outage costs due to

completion of San Juan planned

• utages in 2019
• Higher transmission margins,

recovery of new utility-owned solar resources under the renewable rider

• Refinancing of debt at lower

interest rates

• Additional depreciation and

property tax expenses on new capital investments

• Lower gains on trusts compared

to Q2 2019

$0.24 $0.39

Q2 2019 Q2 2020

Q2 2020 Key Performance Drivers ∆ EPS

Weather and retail load $0.06 Outage Costs $0.06 FERC transmission margin $0.02 Renewable rider $0.01 Interest expense savings $0.01 Other $0.02 Depreciation and property tax ($0.02) Decommissioning/reclamation trust income, net of fees ($0.01)

($0.05) ($0.04) Q2 2019 Q2 2020

Q2 2020 vs Q2 2019 EPS (Ongoing): TNMP and Corporate

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Clean Energy Focus Strong Financial Profile TNMP Corporate

• TCOS increases implemented in

September 2019 and March 2020

• Weather and retail load

increased as a result of higher than normal temperatures; COVID-19 impacts offset between customer classes (volumetric increases, demand-based decreases)

• Higher depreciation and property

tax expenses resulting from additional capital investments

• Corporate earnings increased

due to higher tax benefits resulting from a higher effective tax rate

$0.19 $0.20 Q2 2019 Q2 2020 Q2 2020 Key Performance Drivers ∆ EPS

Rate relief (TCOS) $0.02 Weather and retail load $0.01 Depreciation and property tax ($0.02)

Q2 2020 Key Performance Drivers ∆ EPS

Effective tax rate $0.01

2020 - 2023 Potential Earnings Power

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(1) Average rate base has been reduced by approximately $130M to represent ($0.05) of Earnings Potential for the lost equity return on Four Corners investment determined in the 2018

general rate review. 2022 and 2023 rate base also reflects the removal of $283M undepreciated SJGS investment upon its retirement in mid-2022 to be recovered through securitization.

(2) PNM Renewables reflect assets collected through the Renewable Rate Rider. (3) PNM FERC in 2021-2023 reflects a return of 8%-9% to account for Western Spirit investment recovered through incremental rates. (4) Consists primarily of decommissioning/reclamation trust costs and income (net of fees/taxes), AFUDC, certain incentive compensation, and the 65MW ownership of San Juan Unit 4 (prior

to retirement).

(5) TNMP earnings include additional recovery for Energy Efficiency, along with items excluded from rates (primarily AFUDC) and interest savings from the refinancing of existing debt. (6) Corporate/Other includes the earnings impacts associated with short and intermediate term bank debt and the 50% equity interest in NMRD. (7) Equity Financing Plans to fund capital growth reflects debt costs for assumed $250M-$300M mandatory convertibles issued in Q4 2021 that

convert in 2024 This table is not intended to represent a forward-looking projection of 2021 - 2023 earnings guidance.

Allowed Return / Equity Ratio

2020 Ongoing Earnings Guidance Midpoint 2021 Earnings Potential 2022 Earnings Potential 2023 Earnings Potential Avg Rate Base Return EPS Avg Rate Base EPS Avg Rate Base EPS Avg Rate Base EPS PNM Retail(1)

9.575% / 50% $2.5 B 9.5% $1.47 $2.5 B $1.41 $2.5 B $1.43 $2.5 B $1.44

PNM Renewables(2)

9.575% / 50% $150 M 9.575% $0.09 $145 M $0.08 $140 M $0.08 $130 M $0.07

PNM FERC(3)

10% / ~50% $0.3 B 7.5% $0.15 $0.5 B $0.20 - $0.23 $0.7 B $0.35 - $0.39 $0.8 B $0.37 - $0.42

Items not in Rates(4)

($0.01) ($0.01) - $0.02 $0.01 - $0.03 $0.03 - $0.06

Total PNM

$3.0 B $1.70 $3.1 B $1.68 - $1.74 $3.4 B $1.87 - $1.93 $3.5 B $1.91 - $1.99

TNMP(5)

9.65% / 45% $1.3 B 9.65% $0.73 $1.5 B $0.79 $1.6 B $0.87 $1.9 B $0.97

Corporate/Other(6)

($0.22) ($0.13) - ($0.11) ($0.13)-($0.11) ($0.15) - ($0.13)

Equity Financing Plans(7)

($0.03) - ($0.01) ($0.11)-($0.09) ($0.11) - ($0.09)

Total PNM Resources $4.3 B $2.21 $4.6 B $2.31- $2.41 $5.0 B $2.50 - $2.60 $5.4 B $2.62 - $2.74

COVID-19 Load: Assumptions and EPS Sensitivities

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Clean Energy Focus Strong Financial Profile PNM TNMP

COVID-19 Planning Assumptions:

Current Expectation Residential + 5% Commercial

• 10%

Industrial No significant impacts 10% change in load Monthly EPS Impact Residential Commercial July – September +/- $0.03-$0.04+/- $0.03-$0.04 October – December +/- $0.02 +/- $0.02

Monthly rule of thumb: COVID-19 Planning Assumptions: Monthly rule of thumb:

10% change in load Monthly EPS Impact Volumetric Demand-Based July – September +/- $0.02 +/- $0.01 October – December +/- $0.01 +/- $0.01 Current Expectation Volumetric + 5% Demand-Based

• 5%

Weather Impact

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PNM

Q2 2020 Q2 2019 2020 Normal(1) Heating Degree Days 38 71 62 Cooling Degree Days 561 318 507 Net EPS Impact

compared to normal

$0.01 ($0.07)

TNMP

Q2 2020 Q2 2019 2020 Normal(1) Heating Degree Days 55 53 47 Cooling Degree Days 1,083 1,015 1,023 Net EPS Impact

compared to normal

$0.01 $0.00

(1) 2020 normal weather assumption reflects the 20-year average for the period 2000 - 2019

PNM Cooling Degree Days in Q2 2020 were 76% higher than Q2 2019 and 11% higher than Normal TNMP Cooling Degree Days in Q2 2020 were 7% higher than Q2 2019 and 6% higher than Normal

PNM Scheduled Plant Outages

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San Juan

Unit Duration in Days Time Period

No planned outages in 2020

Palo Verde

Unit Duration in Days Time Period

1 44 Q4 2020

Four Corners

Unit Duration in Days Time Period

5 13 Q4 2020

No further major planned outages at San Juan due to planned retirement in mid-2022

2020 Planned Outage Schedule

Balance Sheet and Credit Metrics

Liquidity as of July 24, 2020

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PNM TNMP

Corporate/ Other PNM Resources Consolidated

Financing Capacity(1):

(In millions) Revolving credit facilities $440.0 $75.0 $340.0 $855.0

As of 7/24/20:

Short-term debt and LOC balances 96.1 0.1 149.5 245.7 Remaining availability 343.9 74.9 190.5 609.3 Invested cash

• 63.5

0.9 64.4 January 2020 Forward Equity Offering 287.1 287.1

Total Available Liquidity $343.9

$138.4 $478.5 $960.8

(1) Excludes intercompany debt and term loans (2) Availability does not reflect $100.3M reserved to provide liquidity support for pollution control revenue refunding bonds remarketed in weekly mode on July 1, 2020

• Available liquidity

strengthened by the issuance of long-term debt at PNM and TNMP in Q2 2020, freeing up capacity on revolving credit facilities

(2)

Selected Balance Sheet Information

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(1) Net of unamortized debt issuance costs, premiums and discounts (2) Excludes intercompany debt

Amounts may not add due to rounding

(In millions) Dec 31, 2019 Jun 30, 2020 Long-Term Debt (incl. current portion) (1) PNM $1,748.0 $1,846.6 TNMP 670.7 780.6 Corporate/Other 589.0 589.5 Consolidated $3,007.7 $3,216.6 Total Debt (incl. short-term) (1,2) PNM $1,806.0 $1,933.7 TNMP 685.7 793.7 Corporate/Other 701.1 741.9 Consolidated $3,192.8 $3,469.2 Long-term targets:

• 16% FFO/Debt ratio
• Corporate/ Other

debt at less than 20%

• f Consolidated debt

Credit Ratings

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PNMR Consolidated S&P Moody’s Issuer rating BBB Baa3 Outlook Stable Stable Senior unsecured rating BBB- Baa3 PNM S&P Moody’s Issuer rating BBB Baa2 Outlook Stable Stable Senior unsecured rating BBB Baa2 Short-term issuer rating A-2 P-2 TNMP S&P Moody’s Issuer rating BBB+ A3 Outlook Stable Stable Senior secured rating A A1

Investment grade credit ratings at PNM Resources, PNM and TNMP