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Segment Information
 9 Months Ended
Sep. 30, 2024
Segment Reporting [Abstract]  
Segment Information Segment Information
The following segment presentation is based on the methodology that management uses for making operating decisions and assessing performance of its various business activities. A reconciliation of the segment presentation to the GAAP financial statements is provided.

PNM

PNM includes the retail electric utility operations of PNM that are subject to traditional rate regulation by the NMPRC. PNM provides integrated electricity services that include the generation, transmission, and distribution of electricity for retail electric customers in New Mexico. PNM also includes the generation and sale of electricity into the wholesale market, which includes the asset optimization of PNM’s retail capacity, as well as providing transmission services to third parties. FERC has jurisdiction over wholesale power and transmission rates. In 2023, ETBC I, a special purpose entity that is wholly-owned by PNM, was formed for the limited purpose of purchasing, owning, and administering energy transition property, issuing Securitized Bonds, and performing related activities. See Note 6.
TNMP

TNMP is an electric utility providing services in Texas under the TECA. TNMP’s operations are subject to traditional rate regulation by the PUCT. TNMP provides transmission and distribution services at regulated rates to various REPs that, in turn, provide retail electric service to consumers within TNMP’s service area. TNMP also provides transmission services at regulated rates to other utilities that interconnect with TNMP’s facilities.

Corporate and Other

The Corporate and Other segment includes TXNM holding company activities, primarily related to corporate level debt and PNMR Services Company. The activities of PNMR Development and the equity method investment in NMRD are also included in Corporate and Other, until the close of the sale of NMRD on February 27, 2024 (Note 16). Eliminations of intercompany transactions are reflected in the Corporate and Other segment.

The following tables present summarized financial information for TXNM by segment. PNM and TNMP each operate in only one segment. Therefore, tabular segment information is not presented for PNM and TNMP.

TXNM SEGMENT INFORMATION
PNMTNMPCorporate
and Other
TXNM
(In thousands)
Three Months Ended September 30, 2024
Electric operating revenues$406,519 $162,737 $— $569,256 
Cost of energy101,495 37,414 — 138,909 
Utility margin305,024 125,323 — 430,347 
Other operating expenses114,591 35,121 (7,845)141,867 
Depreciation and amortization56,424 31,732 9,244 97,400 
Operating income (loss)134,009 58,470 (1,399)191,080 
Interest income (expense)8,674 130 (135)8,669 
Other income
17,296 2,285 154 19,735 
Interest charges(27,852)(15,924)(15,888)(59,664)
Segment earnings (loss) before income taxes
132,127 44,961 (17,268)159,820 
Income taxes (benefit)18,265 9,266 (4,109)23,422 
Segment earnings (loss)
113,862 35,695 (13,159)136,398 
Valencia non-controlling interest
(5,064)— — (5,064)
Subsidiary preferred stock dividends
(132)— — (132)
Segment earnings (loss) attributable to TXNM
$108,666 $35,695 $(13,159)$131,202 
PNMTNMPCorporate
and Other
TXNM
(In thousands)
Nine Months Ended September 30, 2024
Electric operating revenues$1,048,305 $445,930 $— $1,494,235 
Cost of energy313,679 112,240 — 425,919 
Utility margin734,626 333,690 — 1,068,316 
Other operating expenses327,635 102,020 (23,692)405,963 
Depreciation and amortization163,941 93,147 27,912 285,000 
Operating income (loss)243,050 138,523 (4,220)377,353 
Interest income (expense)17,644 426 (351)17,719 
Other income (deductions)
41,711 5,866 (14,845)32,732 
Interest charges(78,848)(43,711)(46,695)(169,254)
Segment earnings (loss) before income taxes
223,557 101,104 (66,111)258,550 
Income taxes (benefit)29,897 20,901 (30,976)19,822 
Segment earnings (loss)
193,660 80,203 (35,135)238,728 
Valencia non-controlling interest
(11,891)— — (11,891)
Subsidiary preferred stock dividends
(396)— — (396)
Segment earnings (loss) attributable to TXNM
$181,373 $80,203 $(35,135)$226,441 
At September 30, 2024:
Total Assets
$7,164,439 $3,505,709 $173,333 $10,843,481 
Goodwill
$51,632 $226,665 $— $278,297 


PNMTNMPCorporate
and Other
TXNM
(In thousands)
Three Months Ended September 30, 2023
Electric operating revenues$350,334 $155,517 $— $505,851 
Cost of energy174,362 35,951 — 210,313 
Utility margin175,972 119,566 — 295,538 
Other operating expenses100,739 35,055 (7,100)128,694 
Depreciation and amortization44,537 28,357 7,298 80,192 
Operating income (loss)30,696 56,154 (198)86,652 
Interest income (expense)5,323 178 (135)5,366 
Other income (deductions)(7,598)2,448 619 (4,531)
Interest charges(22,354)(12,095)(15,389)(49,838)
Segment earnings (loss) before income taxes
6,067 46,685 (15,103)37,649 
Income taxes (benefit)(7,199)7,181 (5,249)(5,267)
Segment earnings (loss)
13,266 39,504 (9,854)42,916 
Valencia non-controlling interest
(5,058)— — (5,058)
Subsidiary preferred stock dividends
(132)— — (132)
Segment earnings (loss) attributable to TXNM
$8,076 $39,504 $(9,854)$37,726 
PNMTNMPCorporate
and Other
TXNM
(In thousands)
Nine Months Ended September 30, 2023
Electric operating revenues$1,118,741 $408,343 $— $1,527,084 
Cost of energy517,824 106,627 — 624,451 
Utility margin600,917 301,716 — 902,633 
Other operating expenses305,615 101,302 (19,762)387,155 
Depreciation and amortization132,287 83,746 21,372 237,405 
Operating income (loss)163,015 116,668 (1,610)278,073 
Interest income (expense)15,542 413 (387)15,568 
Other income (deductions)3,130 4,096 1,148 8,374 
Interest charges(61,242)(33,932)(41,486)(136,660)
Segment earnings (loss) before income taxes
120,445 87,245 (42,335)165,355 
Income taxes (benefit)12,041 13,076 (12,375)12,742 
Segment earnings (loss)
108,404 74,169 (29,960)152,613 
Valencia non-controlling interest
(14,172)— — (14,172)
Subsidiary preferred stock dividends
(396)— — (396)
Segment earnings (loss) attributable to TXNM
$93,836 $74,169 $(29,960)$138,045 
At September 30, 2023:
Total Assets
$6,731,852 $3,039,357 $279,632 $10,050,841 
Goodwill
$51,632 $226,665 $— $278,297 

Non-GAAP Financial Measures

The Company defines utility margin as electric operating revenues less cost of energy. Cost of energy consists primarily of fuel and purchase power costs for PNM and costs charged by third-party transmission providers for TNMP. The Company believes that utility margin provides a more meaningful basis for evaluating operations than electric operating revenues since substantially all such costs are offset in revenues as fuel and purchase power costs are passed through to customers under PNM’s FPPAC and third-party transmission costs are passed on to consumers through TNMP’s transmission cost recovery factor. Utility margin is not a financial measure required to be presented and is considered a non-GAAP measure. PNM and TNMP do not intend for utility margin to represent any financial measure as defined by GAAP. However, the calculation of utility margin, as presented, most closely compares to gross margin as defined by GAAP. Reconciliations between utility margin and gross margin are presented below.
PNMTNMPCorporate and Other
TXNM
(In thousands)
Three Months Ended September 30, 2024
Gross margin$212,218 $85,054 $— $297,272 
Energy production costs21,259 — — 21,259 
Transmission and distribution costs15,123 8,537 — 23,660 
Depreciation and amortization56,424 31,732 — 88,156 
1
Utility margin$305,024 $125,323 $— $430,347 
Nine Months Ended September 30, 2024
Gross margin$457,807 $213,891 $— $671,698 
Energy production costs68,055 — — 68,055 
Transmission and distribution costs44,823 26,652 — 71,475 
Depreciation and amortization163,941 93,147 — 257,088 
1
Utility margin$734,626 $333,690 $— $1,068,316 
PNMTNMPCorporate and Other
TXNM
(In thousands)
Three Months Ended September 30, 2023
Gross margin$95,721 $81,457 $— $177,178 
Energy production costs20,388 — — 20,388 
Transmission and distribution costs15,326 9,752 — 25,078 
Depreciation and amortization44,537 28,357 — 72,894 
1
Utility margin$175,972 $119,566 $— $295,538 
Nine Months Ended September 30, 2023
Gross margin$356,317 $189,199 $— $545,516 
Energy production costs68,345 — — 68,345 
Transmission and distribution costs43,968 28,771 — 72,739 
Depreciation and amortization132,287 83,746 — 216,033 
1
Utility margin$600,917 $301,716 $— $902,633 
1 Corporate and Other depreciation and amortization represents corporate level activities that are billed at cost and reflected as general and administrative expenses at PNM and TNMP and therefore are not a component of gross margin or utility margin. See Note 1.