Business Context and Reporting Period
This Form 10-K covers the fiscal year ended December 31, 2025, for CenterPoint Energy, Inc. (CNP), a public utility holding company, and its primary operating subsidiaries: CenterPoint Energy Houston Electric, LLC (Houston Electric) and CenterPoint Energy Resources Corp. (CERC). The company operates in three reportable segments: Electric (transmission, distribution, and generation in Texas and Indiana), Natural Gas (distribution in Texas, Minnesota, Indiana, and Ohio), and Corporate and Other. As of December 31, 2025, the company served approximately 7 million metered customers.
Key Financial Metrics
| Metric (in millions) | 2025 | 2024 | Change |
|---|---|---|---|
| Total Revenues | $9,357 | $8,643 | +$714 |
| Operating Income | $2,110 | $1,990 | +$120 |
| Net Income | $1,052 | $1,019 | +$33 |
| Net Income Available to Common Shareholders | $1,052 | $1,019 | +$33 |
| Diluted EPS | $1.60 | $1.58 | +$0.02 |
| Operating Cash Flow | $2,486 | $2,139 | +$347 |
| Capital Expenditures | $4,870 | $4,513 | +$357 |
| Total Debt (Long-term + Current) | $22,980 | $20,961 | +$2,019 |
Note: Debt figures include Securitization Bonds. The filing does not provide a specific "margin" percentage, but operating income increased by 6.0% while revenues increased by 8.3%.
Material Changes vs. Prior Period
- Revenue Growth: Total revenues increased by $714 million (8.3%) driven by higher customer rates, transmission revenues, and customer growth, partially offset by the divestiture of Louisiana and Mississippi natural gas businesses.
- Segment Performance:
- Electric: Net income increased $34 million to $705 million, driven by higher transmission revenues and customer growth.
- Natural Gas: Net income increased $4 million to $570 million. This segment included a $49 million loss on the sale of Louisiana and Mississippi LDC businesses, offset by a $46 million gain recognized by CERC and higher gas costs passed through to customers.
- Corporate & Other: Net loss increased slightly to $223 million due to higher borrowing costs, offset by gains on early extinguishment of debt.
- Divestitures: Completed the sale of Louisiana and Mississippi natural gas LDC businesses on March 31, 2025, for approximately $1.2 billion. Entered into an agreement on October 20, 2025, to sell its Ohio natural gas LDC business (CEOH) for approximately $2.62 billion, expected to close in Q4 2026.
- Acquisitions: Acquired Posey Solar (191 MW) in Indiana for approximately $357 million in March 2025.
- Debt Activity: Issued approximately $3.7 billion in new debt in 2025, including convertible senior notes and junior subordinated notes. Repurchased approximately $1.5 billion of outstanding debt via tender offers.
Guidance, Outlook, and Risks
- Capital Plan: Announced a new 10-year capital plan in September 2025, increased in February 2026, to invest approximately $65.5 billion from 2026 through 2035. This supports infrastructure resiliency and anticipated load growth, particularly from data centers and AI.
- Regulatory Matters:
- Hurricane Beryl: Houston Electric is seeking to recover approximately $1.1 billion in system restoration costs via securitization bonds. A financing order was issued in October 2025, with bond issuance expected in February 2026.
- TEEEF: Houston Electric entered an agreement to release 15 large Temporary Emergency Electric Energy Facilities (TEEEF) units to the San Antonio area until March 2027. It also proposed releasing medium TEEEF units to reduce customer rates.
- Rate Cases: Approximately 85% of the rate base has been subject to a rate case since 2023, providing stability through 2029.
- Key Risks:
- Severe Weather: Ongoing recovery and litigation risks related to Hurricane Beryl and the February 2021 Winter Storm Event.
- Regulatory Lag: Delays in cost recovery for capital investments and storm restoration costs.
- Supply Chain & Inflation: Risks regarding material costs, labor shortages, and tariffs impacting the execution of the capital plan.
- Generation Transition: Risks associated with Indiana Electric's transition from coal to renewable/natural gas generation, including regulatory approvals and project costs.
Investor Verification Checklist
- Storm Cost Recovery: Verify the final approval and issuance of the $1.193 billion Series 2026-A Senior Secured System Restoration Bonds for Hurricane Beryl costs.
- Ohio Divestiture: Monitor the closing of the $2.62 billion sale of the Ohio natural gas business (CEOH) to National Fuel Gas Company, expected in Q4 2026.
- Capital Plan Execution: Track the ability to execute the $65.5 billion capital plan amidst supply chain constraints and inflation.
- TEEEF Strategy: Confirm PUCT approval for the release of large and medium TEEEF units and the associated rate reductions.
- Indiana Generation Transition: Review the status of the 2025 Integrated Resource Plan (IRP) and the operational status of F.B. Culley Unit 2 (extended by DOE order through March 2026).
- Debt Maturities: Assess the refinancing needs for debt maturing in 2026, including $2.4 billion for CenterPoint Energy and $827 million for Houston Electric.