CMS CMS Energy Corporation

CMS ENERGY CORPORATION

Consolidated Statements of Income

(Unaudited)

In Millions, Except Per Share Amounts

Twelve Months Ended

12/31/21

12/31/20

12/31/21

12/31/20

Operating revenue

$

2,033

$

1,727

$

7,329

$

6,418

Operating expenses

1,829

1,420

6,183

5,188

Operating Income

204

307

1,146

1,230

Other income (expense)

41

(15)

177

84

Interest charges

126

127

500

505

Income Before Income Taxes

119

165

823

809

Income tax expense

5

27

95

115

Income From Continuing Operations

114

138

728

694

Income from discontinued operations, net of tax

520

24

602

58

Net Income

634

162

1,330

752

Income (loss) attributable to noncontrolling interests

(5)

4

(23)

(3)

Net Income Attributable to CMS Energy

639

158

1,353

755

Preferred stock dividends

2

-

5

-

Net Income Available to Common Stockholders

$

637

$

158

$

1,348

$

755

Basic Earnings Per Average Common Share

Income from continuing operations per average common share
    available to common stockholders

$

0.40

$

0.47

$

2.58

$

2.45

Income from discontinued operations per average common share
    available to common stockholders

1.80

0.08

2.08

0.20

Basic earnings per average common share

$

2.20

$

0.55

$

4.66

$

2.65

Diluted Earnings Per Average Common Share

Income from continuing operations per average common share
    available to common stockholders

$

0.40

$

0.47

$

2.58

$

2.44

Income from discontinued operations per average common share
    available to common stockholders

1.80

0.08

2.08

0.20

Diluted earnings per average common share

$

2.20

$

0.55

$

4.66

$

2.64

CMS ENERGY CORPORATION

Summarized Consolidated Balance Sheets

(Unaudited)

In Millions

Assets

Current assets

Cash and cash equivalents

$

452

$

32

Restricted cash and cash equivalents

24

17

Assets held for sale

19

429

Other current assets

2,132

1,926

Total current assets

2,627

2,404

Non-current assets

Plant, property, and equipment

22,352

21,017

Assets held for sale

-

2,680

Other non-current assets

3,774

3,565

Total Assets

$

28,753

$

29,666

Liabilities and Equity

Current liabilities ⁽¹⁾

Liabilities held for sale

$

-

$

953

Other current liabilities

1,822

1,530

Total current liabilities

1,822

2,483

Non-current liabilities ⁽¹⁾

Liabilities held for sale

-

1,894

Other non-current liabilities

7,269

6,821

Total non-current liabilities

7,269

8,715

Capitalization

Debt, finance leases, and other financing (excluding securitization debt) ⁽²⁾

Debt, finance leases, and other financing (excluding non-recourse and securitization debt)

12,200

12,083

Non-recourse debt

76

83

Total debt, finance leases, and other financing (excluding securitization debt)

12,276

12,166

Preferred stock and securities

224

-

Noncontrolling interests

557

581

Common stockholders' equity

6,407

5,496

Total capitalization (excluding securitization debt)

19,464

18,243

Securitization debt ⁽²⁾

198

225

Total Liabilities and Equity

$

28,753

$

29,666

⁽¹⁾

Excludes debt, finance leases, and other financing.

⁽²⁾

Includes current and non-current portions.

CMS ENERGY CORPORATION

Summarized Consolidated Statements of Cash Flows

(Unaudited)

In Millions

Twelve Months Ended

12/31/21

12/31/20

Beginning of Period Cash and Cash Equivalents, Including Restricted Amounts

$

185

$

157

Net cash provided by operating activities ⁽³⁾

1,819

1,276

Net cash used in investing activities

(1,233)

(2,867)

Cash flows from operating and investing activities

586

Net cash provided by (used in) financing activities

(295)

1,619

Total Cash Flows

$

291

$

28

End of Period Cash and Cash Equivalents, Including Restricted Amounts⁽⁴⁾

$

476

$

185

⁽³⁾

Includes the impact of a $531 million pension contribution in 2020.

⁽⁴⁾

In October 2021, CMS Energy sold EnerBank to Regions Bank.  As a result, EnerBank's cash and cash equivalents are presented as assets held for sale on CMS Energy's consolidated balance sheets at December 31, 2020.

CMS ENERGY CORPORATION

Reconciliation of GAAP Net Income to Non-GAAP Adjusted Net Income

(Unaudited)

In Millions, Except Per Share Amounts

Three Months Ended

Twelve Months Ended

12/31/21

12/31/20

12/31/21

12/31/20

Net Income Available to Common Stockholders

$

637

$

158

$

1,348

$

755

Reconciling items:

Disposal of discontinued operations gain

(665)

-

(657)

-

Tax impact

145

-

143

-

Discontinued operations income

-

(32)

(115)

(76)

Tax impact

-

8

27

18

Other exclusions from adjusted earnings**

* 

2

(1)

13

Tax impact

(*)

(1)

 *  

(3)

Loss on fleet impairment

29

-

29

-

Tax impact

(7)

-

(7)

-

Tax reform

-

-

-

(9)

Voluntary separation program

-

* 

-

11

Tax impact

-

(*)

-

(3)

Adjusted net income – non-GAAP

$

139

$

135

$

767

$

706

Average Common Shares Outstanding

Basic

289.1

285.7

289.0

285.0

Diluted

289.7

286.9

289.5

286.3

Basic Earnings Per Average Common Share

Reported net income per average common share

$

2.20

$

0.55

$

4.66

$

2.65

Reconciling items:

Disposal of discontinued operations gain

(2.30)

-

(2.27)

-

Tax impact

0.50

-

0.49

-

Discontinued operations income

-

(0.11)

(0.39)

(0.26)

Tax impact

-

0.03

0.09

0.06

Other exclusions from adjusted earnings**

* 

0.01

(*)

0.04

Tax impact

(*)

 (*) 

 * 

(0.01)

Loss on fleet impairment

0.10

-

0.10

-

Tax impact

(0.03)

-

(0.03)

-

Tax reform

-

-

-

(0.03)

Voluntary separation program

-

 *  

-

0.04

Tax impact

-

 (*) 

-

(0.01)

Adjusted net income per average common share – non-GAAP

$

0.47

$

0.48

$

2.65

$

2.48

Diluted Earnings Per Average Common Share

Reported net income per average common share

$

2.20

$

0.55

$

4.66

$

2.64

Reconciling items:

Disposal of discontinued operations gain

(2.30)

-

(2.27)

-

Tax impact

0.50

-

0.49

-

Discontinued operations income

-

(0.11)

(0.39)

(0.26)

Tax impact

-

0.03

0.09

0.06

Other exclusions from adjusted earnings**

* 

0.01

(*)

0.04

Tax impact

(*)

 (*) 

* 

(0.01)

Loss on fleet impairment

0.10

-

0.10

-

Tax impact

(0.03)

-

(0.03)

-

Tax reform

-

-

-

(0.03)

Voluntary separation program

-

 *  

-

0.04

Tax impact

-

 (*) 

-

(0.01)

Adjusted net income per average common share – non-GAAP

$

0.47

$

0.48

$

2.65

$

2.47

*

Less than $0.5 million or $0.01 per share.

**

Includes restructuring costs and unrealized gains or losses from mark-to-market adjustments recognized in net income related to CMS Enterprises' interest expense.

Management views adjusted (non-Generally Accepted Accounting Principles) earnings as a key measure of the Company's present operating financial performance and uses adjusted earnings for external communications with analysts and investors.  Internally, the Company uses adjusted earnings to measure and assess performance.  Adjustments could include items such as discontinued operations, asset sales, impairments, restructuring costs, changes in accounting principles, changes in federal tax policy, regulatory items from prior years, unrealized gains or losses from mark-to-market adjustments recognized in net income related to CMS Enterprises' interest expense, or other items.  The adjusted earnings should be considered supplemental information to assist in understanding our business results, rather than as a substitute for reported earnings.