 Forward-Looking Statement
EXHIBIT 99
2
Certain of the matters discussed in this report about our and our subsidiaries'
future performance, including, without limitation, future revenues, earnings, strategies, prospects, consequences
and all other statements that are not purely historical constitute
“forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements are subject to risks and uncertainties, which could cause actual
results to differ materially from those anticipated. Such statements are based on management's beliefs as well as
assumptions made by and information currently available to management. When used
herein, the words “anticipate,” “intend,” “estimate,” “believe,” “expect,” “plan,” “should,” “hypothetical,”
“potential,” “forecast,” “project,” variations of
such words and similar expressions are intended to identify forward-looking statements. Factors that may cause actual results to differ are often
presented with the forward-looking statements themselves. Other factors
that could cause actual results to differ materially from those contemplated in any forward-looking statements made
by us herein are discussed in filings we make with the United States Securities
and Exchange Commission (SEC), including our Annual Report on Form 10-K and subsequent reports on Form
10-Q and Form 8-K and available on our website: http://www.pseg.com.
These factors include, but are not limited to: adverse changes in the demand for or the price of the capacity and energy that
we sell into wholesale electricity markets, adverse changes in energy industry law, policies and regulation, including
market structures and a potential shift away from competitive markets toward subsidized market
mechanisms, transmission planning and cost allocation rules, including rules
regarding how transmission is planned and who is permitted to build transmission in the future, and
reliability standards,
any inability of our transmission and distribution businesses to obtain
adequate and timely rate relief and regulatory approvals from federal and state regulators,
changes in federal and state environmental regulations and enforcement that
could increase our costs or limit our operations, changes in nuclear regulation and/or general developments in the nuclear power
industry, including various impacts from any accidents or incidents experienced at our facilities or
by others in the industry, that could limit operations of our nuclear
generating units, actions or activities at one of our nuclear units located on a multi-unit
site that might adversely affect our ability to continue to operate that unit or other units located at the same
site,
any inability to manage our energy obligations, available supply and risks,
adverse outcomes of any legal, regulatory or other proceeding, settlement,
investigation or claim applicable to us and/or the energy industry,
any deterioration in our credit quality or the credit quality of our
counterparties, availability of capital and credit at commercially reasonable terms and
conditions and our ability to meet cash needs, changes in the cost of, or interruption in the supply of, fuel and other
commodities necessary to the operation of our generating units, delays in receipt of necessary permits and approvals for our construction and
development activities, delays or unforeseen cost escalations in our construction and development
activities, any inability to achieve, or continue to sustain, our expected levels of
operating performance, any equipment failures, accidents, severe weather events or other incidents
that impact our ability to provide safe and reliable service to our customers, and any inability to obtain
sufficient insurance coverage or recover proceeds of insurance with respect to
such events, acts of terrorism, cybersecurity attacks or intrusions that could adversely
impact our businesses, increases in competition in energy supply markets as well as competition for
certain transmission projects, any inability to realize anticipated tax benefits or retain tax credits,
challenges associated with recruitment and/or retention of a qualified
workforce, adverse performance of our decommissioning and defined benefit plan trust fund
investments and changes in funding requirements, changes in technology, such as distributed generation and micro grids, and
greater reliance on these technologies, and changes in customer behaviors, including increases in energy efficiency,
net-metering and demand response. All of the forward-looking statements made in this report are qualified by
these cautionary statements and we cannot assure you that the results or developments anticipated by management
will be realized or even if realized, will have the expected consequences to,
or effects on, us or our business prospects, financial condition or results of operations. Readers are cautioned not to
place undue reliance on these forward-looking statements in making any
investment decision. Forward-looking statements made in this report apply only as of the date of this report. While we
may elect to update forward-looking statements from time to time, we
specifically disclaim any obligation to do so, even if internal estimates change, unless otherwise required by applicable
securities laws.
The forward-looking statements contained in this report are intended to
qualify for the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. |
 GAAP Disclaimer
PSEG presents Operating Earnings in addition to its Income from Continuing
Operations/Net Income reported in accordance with accounting principles
generally accepted in the United States (GAAP). Operating Earnings is a
non- GAAP financial measure that differs from Income from Continuing
Operations/Net Income because it excludes gains or losses associated
with Nuclear Decommissioning Trust (NDT), Mark-to-Market (MTM)
accounting, and other material one-time items. PSEG presents
Operating Earnings because management believes that it is appropriate
for investors to consider results excluding these items in addition to
the results reported in accordance with GAAP. PSEG believes that the
non-GAAP financial measure of Operating Earnings provides a
consistent and comparable measure of performance of its businesses to
help shareholders understand performance trends. This information is
not intended to be viewed as an alternative to GAAP information.
Slides A and B at the end of this presentation include a list of
items excluded
from Income from Continuing Operations/Net Income to reconcile to Operating
Earnings, with a reference to that slide included on each of the
slides where the
non-GAAP information appears.
These materials and other financial releases can be found on the
pseg.com
website under the investor tab, or at http://investor.pseg.com/
3 |
 PSEG 2014 Operating Earnings expected
to be at the upper end of guidance range
$2.44
$2.58
$2.55
-
$2.75E
Reflects increased level of utility investment, pension savings and assumes
normal weather and unit operations for the rest of year
8
2012
2013
2014 Guidance
SEE SLIDE A FOR ITEMS EXCLUDED FROM INCOME FROM CONTINUING
OPERATIONS/NET INCOME TO RECONCILE TO OPERATING
EARNINGS.
E = ESTIMATE.
|
 Operating Earnings Mix
Long term investment program has driven increased earnings
contribution from stable, regulated business
*SEE SLIDE A FOR ITEMS EXCLUDED FROM INCOME FROM
CONTINUING OPERATIONS/ NET INCOME TO RECONCILE TO OPERATING EARNINGS;
DISCONTINUED OPERATIONS REFLECT TEXAS. E=ESTIMATE ** 2014
PERCENTS USE MIDPOINT OF EARNINGS GUIDANCE. Power’s
diverse
fuel
mix
and dispatch flexibility
continues to generate
earnings and free cash flow
PSE&G’s
investment
in
transmission has
diversified its asset base
and, coupled with other
investments
and cost controls,
supported compound
annual earnings growth of
~18% over 2009 –
2013
Operating
Earnings*
Contribution
by
Subsidiary
(%)
PSE&G
Power
Other
$2.44
$2.58
$2.55 -
$2.75E
$3.12
$2.74
$3.09
2009
2010
2011
2012
2013
2014E**
9
20%
27%
38%
43%
47%
54%
76%
69%
62%
54%
54%
43% |
 PSEG Q2 2014 Financial Highlights
*SEE SLIDE B FOR ITEMS EXCLUDED FROM NET INCOME TO RECONCILE TO OPERATING
EARNINGS Earnings on Track
Operating earnings of $0.49 vs. $0.48 per share in Q2 2013
Increased earnings contribution from PSE&G’s investment in
Transmission Expect 2014 Operating Earnings to be at the upper end of the
$2.55 to $2.75 per share guidance
range
–
assuming
normal
weather
and
plant
operations
for
the
balance
of
the
year
Operating Review
PSEG Power output down 5% vs. Q2 2013 from Linden and Salem 2 outages,
partially offset by improvement in coal generation
PSE&G placed the 230 kV North Central Reliability transmission project in
service Power’s fleet fully restored from storm outages
PSEG Disciplined Capital Investment
BPU approved $1.22 billion investment in PSE&G’s Energy Strong
infrastructure program PJM
deferred
a
final
decision
on
its
recommended
solution,
to
be
built
by
PSE&G,
for
the
Artificial Island project via FERC 1000 competitive bidding process
Market Developments
Recent EPA actions on 316(b) and GHGs
16 |
 PSE&G’s 2014 operating earnings
to benefit from increased investment in transmission and
on-going cost control
E=ESTIMATE
PSE&G Operating Earnings*
($ Millions)
41
*SEE SLIDE A FOR ITEMS
EXCLUDED FROM INCOME FROM CONTINUING
OPERATIONS/NET INCOME TO RECONCILE TO OPERATING EARNINGS. |
 Competitive/Sustainable Advantage:
PSEG expanding supply of low-cost Marcellus gas
PSEG plans to invest $100 -
$120 million for
a 12% equity interest in the to-be-constructed
PennEast Pipeline, a 105.5 mile pipeline that
would bring gas from eastern Pennsylvania to
New Jersey
PSEG ER&T would contract for approximately
125mmcf/day of PennEast’s 1 bcf/day
capacity under a 15-year contract; other
project sponsors have committed to offtake
~500mmcf/day
PSEG and its customers would benefit from
the displacement of higher-cost, Gulf Coast
gas supply
Targeted in-service date is November 2017
Proposed PennEast Pipeline Project
72 |
 Improving Operating Earnings
and increased contribution from PSE&G
PSEG Operating Earnings
$ Millions (except EPS)
2012
2013
2014E
PSE&G
$528
$612
$705 -
$745
PSEG Power
$663
$710
$550 -
$610
Enterprise/Other
$45
($13)
$35 -
$40
Operating Earnings*
$1,236
$1,309
$1,290 -
$1,395
Operating EPS*
$2.44
$2.58
$2.55
-
$2.75
Regulated % of Earnings
43%
47%
53%
-
55%
*
SEE SLIDE A FOR ITEMS EXCLUDED FROM INCOME FROM CONTINUING OPERATIONS/NET
INCOME TO RECONCILE TO OPERATING EARNINGS.
NOTE: 2012 OPERATING EARNINGS RE-STATED FOR TRANSFER OF ASSETS FROM PSEG
HOLDINGS TO PSEG POWER. E=ESTIMATE.
92 |
 Items
Excluded from Income from Continuing Operations/Net Income to Reconcile to
Operating Earnings PLEASE SEE PAGE 3 FOR AN EXPLANATION OF PSEG’S
USE OF OPERATING EARNINGS AS A NON-GAAP FINANCIAL MEASURE AND HOW IT
DIFFERS FROM NET INCOME.
Includes the financial impact from positions with forward delivery
months. A
2013
2012
2011
2010
2009
2008
Earnings Impact ($ Millions)
Operating Earnings
1,309
$
1,236
$
1,389
$
1,584
$
1,567
$
1,478
$
Gain (Loss) on Nuclear Decommissioning Trust (NDT)
Fund Related Activity (PSEG Power)
40
52
50
46
9
(71)
Gain
(Loss)
on
Mark-to-Market
(MTM)
(a)
(PSEG
Power)
(74)
(10)
107
(1)
(11)
14
Lease Transaction Activity (PSEG Enterprise/Other)
-
36
(173)
-
29
(490)
Storm O&M (PSEG Power)
(32)
(39)
-
-
-
-
Market Transition Charge Refund (PSE&G)
-
-
-
(72)
-
-
Gain (Loss) on Asset Sales and Impairments (PSEG Enterprise/Other)
-
-
34
-
-
(13)
Income from Continuing Operations
1,243
$
1,275
$
1,407
$
1,557
$
1,594
$
918
$
Discontinued Operations
-
-
96
7
(2)
270
Net Income
1,243
$
1,275
$
1,503
$
1,564
$
1,592
$
1,188
$
Fully Diluted Average Shares Outstanding (in Millions)
508
507
507
507
507
508
Per Share Impact (Diluted)
Operating Earnings
2.58
$
2.44
$
2.74
$
3.12
$
3.09
$
2.91
$
Gain (Loss) on NDT Fund Related Activity (PSEG Power)
0.08
0.10
0.10
0.09
0.02
(0.14)
Gain
(Loss)
on
MTM
(a)
(PSEG
Power)
(0.14)
(0.02)
0.21
-
(0.02)
0.03
Lease Transaction Activity (PSEG Enterprise/Other)
-
0.07
(0.34)
-
0.05
(0.96)
Storm O&M (PSEG Power)
(0.07)
(0.08)
-
-
-
-
Market Transition Charge Refund (PSE&G)
-
-
-
(0.14)
-
-
Gain (Loss) on Asset Sales and Impairments (PSEG Enterprise/Other)
-
-
0.06
-
-
(0.03)
Income from Continuing Operations
2.45
$
2.51
$
2.77
$
3.07
$
3.14
$
1.81
$
Discontinued Operations
-
-
0.19
0.01
-
0.53
Net Income
2.45
$
2.51
$
2.96
$
3.08
$
3.14
$
2.34
$
For the Year Ended
December 31,
(Unaudited)
PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED
Reconciling Items, net of tax
(a) |