Evergy Inc

Previous wording

15,800 MWs of owned generating capacity and renewable power purchase agreements and engage in the generation, transmission, distribution and sale of electricity to approximately 1.7 million customers in the states of Kansas and Missouri. The Evergy Companies assess financial performance and allocate resources on a consolidated basis (i.e., operate in one segment).

Current wording

Evergy Kansas Central, Evergy Kansas South, Evergy Metro and Evergy Missouri West conduct business in their respective service territories using the name Evergy. Collectively, the Evergy Companies have approximately 15,800 MWs of owned generating capacity and renewable power purchase agreements and engage in the generation, transmission, distribution and sale of electricity to approximately 1.7 million customers in the states of Kansas and Missouri. The Evergy Companies assess financial performance and allocate resources on a consolidated basis (i.e., operate in one segment).

Previous wording

In February 2024, Evergy Missouri West filed an application with the MPSC to request an increase to its retail revenues of approximately $104 million. Evergy Missouri West's request reflected a return on equity of 10.5% (with a capital structure composed of 52% equity) and increases related to the recovery of infrastructure investments made to improve reliability and enhance customer service and the inclusion of certain costs related to Dogwood and Crossroads, two natural gas plants. An evidentiary hearing in the case is scheduled to occur beginning in late September 2024 and new rates are expected to be effective in January 2025.

Current wording

In February 2024, Evergy Missouri West filed an application with the MPSC to request an increase to its retail revenues of approximately $104 million. Evergy Missouri West's request reflected a return on equity of 10.5% (with a capital structure composed of 52% equity) and increases related to the recovery of infrastructure investments made to improve reliability and enhance customer service and the inclusion of certain costs related to Dogwood and Crossroads, two natural gas plants.

Previous wording

Additionally, the bill establishes new mechanisms for the recovery of costs associated with new gas-fired generating units. If the KCC decides investment in a new gas-fired generating unit is reasonable, the utility would be able to recover the return on 100% of the associated construction costs at its weighted average cost of capital. The cost recovery from customers could begin a year after construction begins. Rates could be adjusted every six months until new base rates reflecting the plant's costs are established.

Current wording

Additionally, the law establishes new mechanisms for the recovery of costs associated with new gas-fired generating units. If the KCC decides investment in a new gas-fired generating unit is reasonable, the utility would be able to recover the return on 100% of the associated construction costs at its weighted average cost of capital. The cost recovery from customers could begin a year after construction begins. Rates could be adjusted every six months until new base rates reflecting the plant's costs are established.

Previous wording

In April 2024, Evergy Missouri West purchased a 22% ownership interest representing approximately 145 MW in Dogwood, an operational natural gas combined cycle facility located in Missouri, for approximately $60 million. The purchase was recorded as an asset acquisition to property, plant and equipment, net on Evergy's consolidated balance sheet. The purchase was subject to terms and conditions listed in a stipulation and agreement approved by the MPSC allowing Evergy Missouri West to recover in rates a return of and return on the original cost, net of accumulated depreciation, of Dogwood. Evergy Missouri West shall also be allowed to recover in rates over two years a return of, but not a return on, the amount of the purchase price paid in excess of the original cost, net of accumulated depreciation, of Dogwood. In addition, net revenues generated from Evergy Missouri West's ownership of Dogwood from the date of closing to the date new rates become effective in Evergy Missouri West's current rate case shall not impact rates and shall be retained by Evergy Missouri West and reduce the amount of the purchase price paid in excess of the original cost, net of accumulated depreciation, of Dogwood to be recovered from customers.

Current wording

In April 2024, Evergy Missouri West purchased a 22% ownership interest representing approximately 145 MW in Dogwood, an operational combined-cycle natural gas facility located in Missouri, for approximately $60 million. The purchase was recorded as an asset acquisition to property, plant and equipment, net, on Evergy's consolidated balance sheet. The purchase was subject to terms and conditions listed in a stipulation and agreement approved by the MPSC allowing Evergy Missouri West to recover in rates a return of and return on the original cost, net of accumulated depreciation, of Dogwood. Evergy Missouri West shall also be allowed to recover in rates over two years a return of, but not a return on, the amount of the purchase price paid in excess of the original cost, net of accumulated depreciation, of Dogwood. In addition, net revenues generated from Evergy Missouri West's ownership of Dogwood from the date of closing to the date new rates become effective in Evergy Missouri West's current rate case shall not impact rates and shall be retained by Evergy Missouri West and reduce the amount of the purchase price paid in excess of the original cost, net of accumulated depreciation, of Dogwood to be recovered from customers.

Previous wording

In May 2024, President Biden signed into law the Prohibiting Russian Uranium Imports Act, which limits the importation of uranium from Russia. The Evergy Companies have a Russian-sourced contract beginning in 2026 to obtain nuclear fuel and haven taken mitigating measures to minimize the impact of the Prohibiting Russian Uranium Imports Act to their supply chain. The Evergy Companies do not expect a material impact to their supply chain or financial results.

Current wording

In May 2024, President Biden signed into law the Prohibiting Russian Uranium Imports Act, which limits the importation of uranium from the Russian Federation. The Evergy Companies have a Russian-sourced contract beginning in 2025 to obtain nuclear fuel and have taken mitigating measures to minimize the impact of the Prohibiting Russian Uranium Imports Act to their supply chain. The Evergy Companies do not expect a material impact to their supply chain or financial results.

Previous wording

The following table summarizes Evergy's net income and diluted earnings per common share (EPS).

Current wording

The following table summarizes Evergy's net income and diluted EPS.

Previous wording

Net income attributable to Evergy, Inc. increased for the three months ended June 30, 2024, compared to the same period in 2023, primarily due to new Evergy Kansas Central retail rates effective in December 2023, higher transmission revenues, lower pension non-service costs, higher retail sales driven by favorable weather and higher weather-normalized demand and mark-to-market losses related to forward contracts for natural gas and electricity in 2023; partially offset by higher taxes other than income tax, depreciation, operating and maintenance and interest expense in the second quarter of 2024.

Current wording

Net income attributable to Evergy, Inc. increased year to date September 30, 2024, compared to the same period in 2023, primarily due to new Evergy Kansas Central retail rates effective in December 2023, the recognition of a $96.5 million regulatory liability in the third quarter of 2023 for future refund of amounts of revenues previously collected from customers related to COLI rate credits, higher transmission revenues and lower pension non-service costs; partially offset by higher taxes other than income tax, depreciation, interest, operating and maintenance expense and lower investment earnings in 2024.

Previous wording

Evergy's adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP) for the three months ended and year to date June 30, 2024 were $207.0 million or $0.90 per share and $331.7 million or $1.44 per share, respectively. For the three months ended and year to date June 30, 2023, Evergy's adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP) were $186.1 million or $0.81 per share and $322.2 million or $1.40 per share, respectively.

Current wording

Evergy's adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP) for the three months ended and year to date September 30, 2024 were $465.6 million or $2.02 per share and $797.3 million or $3.46 per share, respectively. For the three months ended and year to date September 30, 2023, Evergy's adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP) were $432.3 million or $1.88 per share and $754.5 million or $3.27 per share, respectively.

Previous wording

ii. the costs resulting from non-regulated energy marketing margins from the February 2021 winter weather event; and

Current wording

ii. the costs resulting from non-regulated energy marketing margins from the February 2021 winter weather event;

Previous wording

iii. the second quarter 2023 recognition of a regulatory liability for the refund to customers of revenues previously collected since October 2019 for costs related to an electric subdivision rebate program to be refunded to customers in accordance with a June 2020 KCC order.

Current wording

iii. the second quarter 2023 recognition of a regulatory liability for the refund to customers of revenues previously collected since October 2019 for costs related to an electric subdivision rebate program to be refunded to customers in accordance with a June 2020 KCC order; and

Previous wording

(d)Reflects an income tax effect calculated at a statutory rate of approximately 22%.

Current wording

(e)Reflects an income tax effect calculated at a statutory rate of approximately 22%.

Previous wording

Evergy's gross margin (GAAP) increased $15.5 million for the three months ended June 30, 2024, compared to the same period in 2023 and Evergy's utility gross margin (non-GAAP) increased $54.5 million for the three months ended June 30, 2024, compared to the same period in 2023, both measures were driven by:

Current wording

Evergy's gross margin (GAAP) increased $144.6 million for the three months ended September 30, 2024, compared to the same period in 2023 and Evergy's utility gross margin (non-GAAP) increased $162.5 million for the three months ended September 30, 2024, compared to the same period in 2023, both measures were driven by:

Previous wording

•a $29.3 million net increase from new retail rates in Kansas effective in December 2023 consisting of $34.8 million from higher Evergy Kansas Central retail rates, partially offset by $5.5 million from lower Evergy Metro retail rates;

Current wording

•a $43.1 million net increase from new retail rates in Kansas effective in December 2023 consisting of $51.1 million from higher Evergy Kansas Central retail rates, partially offset by $8.0 million from lower Evergy Metro retail rates;

Previous wording

•a $5.2 million increase due to Evergy Missouri West's recovery of extraordinary fuel and purchased power costs incurred as part of the February 2021 winter weather event through a securitized utility tariff charge effective in February 2024; partially offset by

Current wording

•a $9.5 million increase due to Evergy Missouri West's recovery of extraordinary fuel and purchased power costs incurred as part of the February 2021 winter weather event through a securitized utility tariff charge effective in February 2024; and

Previous wording

•a $7.7 million decrease related to non-regulated sales in the second quarter of 2023 related to Evergy Kansas Central's 8% ownership share of JEC, which is included in rate base in 2024 as a result of Evergy Kansas Central's 2023 rate case.

Current wording

•a $10.6 million decrease related to non-regulated sales in the third quarter of 2023 related to Evergy Kansas Central's 8% ownership share of JEC, which is included in rate base in 2024 as a result of Evergy Kansas Central's 2023 rate case; and

Previous wording

Additionally, the increase in Evergy's gross margin (GAAP) was also driven by:

Current wording

Additionally, the increase in Evergy's gross margin (GAAP) was also impacted by:

Previous wording

•a $13.5 million increase due to issuances of long-term debt; partially offset by

Current wording

•a $13.5 million increase in taxes other than income tax as further described below; and

Previous wording

•a $7.8 million increase in taxes other than income tax as further described below; partially offset by

Current wording

•a $9.0 million increase in depreciation and amortization as further described below; partially offset by

Previous wording

•a $4.6 million decrease due to higher mark-to-market losses related to forward contracts for natural gas and electricity entered into as economic hedges against fuel price volatility related to Evergy Kansas Central's 8% ownership share of JEC in 2024.

Current wording

•a $4.6 million decrease in operating and maintenance expenses which are determined to be directly attributable to revenue producing activities primarily driven by a $4.8 million decrease in transmission and distribution operating and maintenance expense.

Previous wording

Evergy's gross margin (GAAP) decreased $6.1 million year to date June 30, 2024, compared to the same period in 2023 and Evergy's utility gross margin (non-GAAP) increased $75.0 million year to date June 30, 2024, compared to the same period in 2023, both measures were driven by:

Current wording

Evergy's gross margin (GAAP) increased $138.5 million year to date September 30, 2024, compared to the same period in 2023 and Evergy's utility gross margin (non-GAAP) increased $237.5 million year to date September 30, 2024, compared to the same period in 2023, both measures were driven by:

Previous wording

•a $56.8 million net increase from new retail rates in Kansas effective in December 2023 consisting of $66.7 million from higher Evergy Kansas Central retail rates, partially offset by $9.9 million from lower Evergy Metro retail rates;

Current wording

•a $99.9 million net increase from new retail rates in Kansas effective in December 2023 consisting of $117.9 million from higher Evergy Kansas Central retail rates, partially offset by $18.0 million from lower Evergy Metro retail rates;

Previous wording

•a $6.3 million increase due to Evergy Missouri West's recovery of extraordinary fuel and purchased power costs incurred as part of the February 2021 winter weather event through a securitized utility tariff charge effective in February 2024; partially offset by

Current wording

•a $14.7 million increase due to Evergy Missouri West's recovery of extraordinary fuel and purchased power costs incurred as part of the February 2021 winter weather event through a securitized utility tariff charge effective in February 2024;

Previous wording

•an $11.1 million decrease as a result of recording a reduction in the second quarter of 2023 to Evergy Metro's Earnings Review and Sharing Plan (ERSP) refund obligation to customers; and

Current wording

•an $11.1 million decrease as a result of recording a reduction in the second quarter of 2023 to Evergy Metro's Earnings Review and Sharing Plan (ERSP) refund obligation to customers.

Previous wording

•a $33.8 million increase in operating and maintenance expenses which are determined to be directly attributable to revenue producing activities primarily driven by a $21.3 million increase in transmission and distribution operating and maintenance expense and a $10.3 million increase in plant operating and maintenance expense at fossil-fuel generating units; partially offset by a $4.2 million decrease in plant operating and maintenance expense at Wolf Creek as further described below;

Current wording

•a $29.2 million increase in operating and maintenance expenses which are determined to be directly attributable to revenue producing activities primarily driven by a $16.5 million increase in transmission and distribution operating and maintenance expense and a $12.7 million increase in operating and maintenance expense at generating facilities as further described below.

Previous wording

•a $21.3 million increase in transmission and distribution operating and maintenance expenses driven by an $11.3 million increase in labor expense primarily due to a decrease in labor capitalization in 2024 driven by lower capitalization activity related to the installation of transformers and meters in 2024, higher storm outage activity and higher employee headcount and a $10.0 million increase in non-labor expense primarily due to $3.6 million of higher costs incurred from storms in 2024 and a $1.6 million increase in vegetation management costs; and

Current wording

•a $16.5 million increase in transmission and distribution operating and maintenance expenses driven by a $9.5 million increase in labor expense primarily due to a decrease in labor capitalization in 2024 driven by lower capitalization activity related to the installation of transformers and meters in 2024 and higher employee headcount and a $7.0 million increase in non-labor expense including a $2.8 million increase in vegetation management costs; and

Previous wording

•a $10.3 million increase in plant operating and maintenance expense at fossil-fuel generating units primarily due to a $12.5 million increase at Evergy Kansas Central driven by a major maintenance outage at JEC in 2024; partially offset by

Current wording

•a $12.7 million increase in operating and maintenance expense at generating facilities primarily due to a $16.0 million increase at Evergy Kansas Central driven by a major maintenance outage at JEC in 2024; partially offset by a $5.0 million decrease at Evergy Metro driven by a major maintenance outage at Hawthorn Station in 2023.

Previous wording

Evergy's depreciation and amortization increased $10.7 million for the three months ended June 30, 2024, compared to the same period in 2023, driven by:

Current wording

Evergy's depreciation and amortization increased $9.0 million for the three months ended September 30, 2024, compared to the same period in 2023, driven by:

Previous wording

•an $18.7 million increase in operating and maintenance expenses which are determined to be directly attributable to revenue producing activities primarily driven by a $12.5 million increase in plant operating and maintenance expense at fossil-fuel generating units and a $7.4 million increase in transmission and distribution operating and maintenance expense; partially offset by a $2.2 million decrease in operating and maintenance expense at Wolf Creek as described further below; and

Current wording

•a $7.4 million increase primarily due to a change in depreciation rates as a result of Evergy Kansas Central's and Evergy Metro's 2023 rate cases effective in December 2023; and

Previous wording

Evergy's depreciation and amortization increased $23.4 million year to date June 30, 2024, compared to the same period in 2023, driven by:

Current wording

Evergy's depreciation and amortization increased $32.4 million year to date September 30, 2024, compared to the same period in 2023, driven by:

Previous wording

Evergy's taxes other than income tax increased $12.2 million for the three months ended June 30, 2024, compared to the same period in 2023, primarily driven by increases at Evergy Kansas Central and Evergy Metro primarily due to the rebasing of property taxes as a result of Evergy Kansas Central's and Evergy Metro's 2023 rate cases effective in December 2023.

Current wording

Evergy's taxes other than income tax increased $13.5 million for the three months ended September 30, 2024, compared to the same period in 2023, primarily driven by increases at Evergy Kansas Central and Evergy Metro primarily due to the rebasing of property taxes as a result of Evergy Kansas Central's and Evergy Metro's 2023 rate cases effective in December 2023.

Previous wording

Evergy's taxes other than income tax increased $23.9 million year to date June 30, 2024, compared to the same period in 2023, primarily driven by increases at Evergy Kansas Central and Evergy Metro primarily due to the rebasing of property taxes as a result of Evergy Kansas Central's and Evergy Metro's 2023 rate cases effective in December 2023.

Current wording

Evergy's taxes other than income tax increased $37.4 million year to date September 30, 2024, compared to the same period in 2023, primarily driven by increases at Evergy Kansas Central and Evergy Metro primarily due to the rebasing of property taxes as a result of Evergy Kansas Central's and Evergy Metro's 2023 rate cases effective in December 2023.

Previous wording

•a $7.8 million decrease due to higher debt allowance for funds used during construction (AFUDC) primarily driven by higher construction work in progress balances in 2024.

Current wording

•a $3.7 million increase in equity allowance for funds used during construction (AFUDC) primarily at Evergy Kansas Central and Evergy Metro primarily driven by higher construction work in progress balances and lower short-term debt balances in 2024; and

Previous wording

•a $7.9 million decrease in investment earnings primarily driven by a $5.0 million decrease in carrying charges related to deferred Evergy Missouri West's costs associated with the February 2021 winter weather event to be recovered through a securitized utility tariff charge effective in February 2024.

Current wording

•a $14.2 million decrease in investment earnings primarily driven by an $11.3 million decrease in interest and dividend income primarily due to a decrease in carrying charges related to deferred Evergy Missouri West costs associated with the February 2021 winter weather event to be recovered through a securitized utility tariff charge effective in February 2024; and

Previous wording

•a $15.7 million decrease in interest expense on short-term borrowings primarily due to lower short-term debt balances in the second quarter of 2024.

Current wording

•a $20.1 million decrease in interest expense on short-term borrowings primarily due to lower short-term debt balances in the third quarter of 2024; and

Previous wording

•a $5.4 million increase primarily due to Evergy Kansas Central higher pre-tax income in the second quarter of 2024; partially offset by Evergy Metro and Evergy Missouri West lower pre-tax income in the second quarter of 2024.

Current wording

•a $27.5 million increase primarily due to higher Evergy Kansas Central pre-tax income in the third quarter of 2024; partially offset by

Previous wording

As of June 30, 2024, Evergy had $1,527.6 million of available borrowing capacity under its master credit facility. The available borrowing capacity under the master credit facility consisted of $199.3 million for Evergy, Inc., $153.4 million for Evergy Kansas Central, $584.7 million for Evergy Metro and $590.2 million for Evergy Missouri West. The Evergy Companies' borrowing capacity under the master credit facility also supports their issuance of commercial paper. See Note 8 to the consolidated financial statements for more information regarding the master credit facility.

Current wording

As of September 30, 2024, Evergy had $1,074.5 million of available borrowing capacity under its master credit facility. The available borrowing capacity under the master credit facility consisted of $216.1 million for Evergy, Inc., $257.3 million for Evergy Kansas Central, $377.1 million for Evergy Metro and $224.0 million for Evergy Missouri West. The Evergy Companies' borrowing capacity under the master credit facility also supports their issuance of commercial paper. See Note 8 to the consolidated financial statements for more information regarding the master credit facility.

Previous wording

In May 2024, Moody's Investor Service changed Evergy Missouri West's outlook from Stable to Negative, and affirmed credit ratings as detailed in the following table.

Current wording

In May 2024, Moody's Investors Service changed Evergy Missouri West's outlook from Stable to Negative, and affirmed credit ratings as detailed in the following table.

Previous wording

Year to date June 30, 2024, Evergy made no cash pension contributions. Evergy expects to make cash pension contributions of$36.8 million in 2024. Year to date June 30, 2024, Evergy made post-retirement benefit contributions of $0.4 million. Evergy expects to make additional post-retirement benefit contributions of $0.2 million in 2024. See Note 7 to the consolidated financial statements for additional information on Evergy's pension and post-retirement plans.

Current wording

Year to date September 30, 2024, Evergy made no cash pension contributions. Evergy expects to make cash pension contributions of$36.8 million in 2024. Year to date September 30, 2024, Evergy made post-retirement benefit contributions of $0.8 million. Evergy expects to make no additional post-retirement benefit contributions in 2024. See Note 7 to the consolidated financial statements for additional information on Evergy's pension and post-retirement plans.

Previous wording

In July 2024, Evergy Kansas Central, Evergy Kansas South, Evergy Metro and Evergy Missouri West filed requests with FERC to issue and to have outstanding at any one time up to $1,250.0 million, $1,000.0 million, $1,250.0 million and $750.0 million in short-term debt instruments, respectively, through December 2026. Evergy Kansas Central, Evergy Kansas South, Evergy Metro and Evergy Missouri West have requested a response from FERC by October 4, 2024.

Current wording

In July 2024, Evergy Kansas Central, Evergy Kansas South, Evergy Metro and Evergy Missouri West filed applications with FERC to issue and to have outstanding at any one time up to $1,250.0 million, $1,000.0 million, $1,250.0 million and $750.0 million in short-term debt instruments, respectively, through December 2026. Evergy Kansas Central, Evergy Kansas South, Evergy Metro and Evergy Missouri West are awaiting a response from FERC.

Previous wording

In July 2024, Evergy Missouri West filed a request with FERC to issue up to a total of $600.0 million in long-term debt instruments for a two-year authorization period beginning on the date of the FERC approval. Evergy Missouri West has requested a response from FERC by November 22, 2024.

Current wording

In July 2024, Evergy Missouri West filed an application with FERC to issue up to a total of $600.0 million in long-term debt instruments for a two-year authorization period beginning on the date of the FERC approval. Evergy Missouri West is awaiting a response from FERC.