CMS Energy Corporation - 5.625% NT REDEEM 15/03/2078 USD 25

Core outlook reaffirmed (earnings growth + confidence): - 2026 adjusted EPS guidance reaffirmed: $3.83–$3.90, with confidence toward the high end. - 2027 adjusted EPS guidance reaffirmed: $4.08–$4.17, reflecting the NorthStar restructuring. - Longer-term model: continues to target 6%–8% adjusted EPS growth, toward the high end (~7%+) with about a ~3% dividend yield (as stated in the prepared remarks).

NorthStar restructuring progressing well (key driver of “improving earnings quality”): - As of call date, >35% of assets have signed agreements or closed; remaining assets are in exclusivity with buyers. - Company is on track to complete restructuring by year-end. - Restructuring expected to reduce parent funding needs by >$500 million within the current 5-year plan (to redirect that funding toward the regulated utility). - Importantly: CMS says it still retains some assets (e.g., Dearborn Industrial Generation, small gas peakers, and 4 commercial solar projects) that generate strong cash flows and support long-term strategy.

Michigan IRP filed: large clean-capital plan + FCM mechanics are a major earnings lever: - CMS filed an IRP through 2040 to meet Michigan clean energy targets while maintaining reliability. - Plan includes 15.8 GW clean energy, 4.1 GW battery storage (up from prior plan), and 1.4 GW new simple-cycle gas to replace aging peakers at Karn 3 & 4. - CMS highlights a utility-earning differentiator: FCM (financial compensation mechanism) assumed starting 2031 at $125M, rising to ~$195M by 2040 (assuming 50% ownership split). - Surprising/important investor takeaway: Management argues the FCM is not expected to go away post-election, and emphasizes contract durability/visibility (they indicated >70% of relevant contracts are already signed or online by 2031). - Also noted: an example large clean-energy PPA of 680 MW recently signed to de-risk development and support IRP capacity needs.