Good morning everyone, and welcome to the CMS Energy 2009 first quarter results and outlook call. This call is being recorded. Just a reminder, there will be a rebroadcast of this conference call today, beginning at noon Eastern Time, running through May 7. This presentation is also being webcast and is available on CMS Energy's website in the Investor Relations section. At this time, I would like to turn the call over to Ms. Laura Mountcastle, Vice President and Treasurer. Please go ahead.

Thank you. Good morning and thank you for joining us for our 2009 first quarter earnings presentation. With me today are Dave Joos, President and Chief Executive Officer; and Tom Webb, Executive Vice President and Chief Financial Officer. Our earnings press release issued earlier today, and the presentation used in this webcast are available on our website at cmsenergy.com. This presentation contains forward-looking statements. These statements are subject to risks and uncertainties, and should be read in conjunction with our Form 10-K and 10-Q. The forward-looking statements and information and Risk Factors sections discuss important factors that could cause results to differ materially from those anticipated in such statements. This presentation also includes non-GAAP measures when describing the company's results of operations and financial performance. A reconciliation of each of these measures to the most directly comparable GAAP measure is included in the appendix and posted in the Investor section of our website. We expect 2009 reported earnings to be about the same as adjusted earnings. Reported earnings could vary because of several factors. We are not providing reported earnings guidance reconciliation because of the uncertainties associated with those factors. Now, I turn the call over to Dave.

Thanks, Laura. Good morning. As is our usual practice, I'll start the presentation with a brief update on the business, and then I will turn the call over to Tom for a more detailed discussion on the financial results and outlook, and then we will close with questions and answers. First quarter 2009 earnings were on plan at $0.30 a share. This was down $0.13 from last year, due in large part to the effect of a new seasonal rate design on electric sales, and 2008 gain on the sales of sulfur dioxide allowances that were not repeated in 2009. Tom will give you more detail on that in a few minutes. For the full-year, we expect adjusted earnings of a $1.25 a share, unchanged from our previous guidance. Although, it's old news to almost everyone now, we raised our dividend in the first quarter of 2009 to an annualized $0.50 a share. This reflects the progress we've made on our growing forward strategy, and the confidence the Board has in our business plan. There are a number of important regulatory matters on the calendar over the next couple of months that will have a meaningful impact on earnings and cash flow, in particular, the electric and gas rate case filings. Last week, the Michigan Public Service Commission issued a procedural order in our electric rate case directing us to file the rates we intend to self-implement in mid-May. I'll discuss the rates we filed yesterday and the staff filing in our case on the next slide. Before I do, I want to talk about the state of the business in Michigan. Just about every company has felt the effect of the weak economy, and we are no exception. The financial plight of the big three automotive companies continues to…

Thanks Dave. My thanks to everybody for joining in our call today I know it's a busy day. Earnings in the first quarter were $0.30 a share equal to our plan at $0.13 below last year. This reflects lower sales, seasonality change, and recognition of SO2 allowance sales in 2008 that we've not repeated this year, higher uncollectible accounts to reflect SAP launch related collection delays, and other, offset partly by a rate relief approved last year. For the rest of the year, we are planning on lower sales more than offset by rate increases, a good portion of which are already approved. As Dave mentioned, fully year adjusted EPS guidance is unchanged at $1.25. While sales and uncollectible accounts are adverse, new cost reductions and demand rates provide offsets. We underestimated the demand portion of our bills as some customers continued operations while shifts were cut or reduced. The electric business represents the bulk of our earnings, and with our electric rate case order last June, rates were redesigned to be higher in the summer and lower in the winter to encourage conservation during the high demand season. On this slide, we isolate only the impact of seasonality. This redesigns results in higher historic revenue and profit in the summer but lowers than historic revenue and profit in the first and fourth quarters. This is just what we experienced in the earnings uptick last summer as well as the expected decline in the fourth quarter last year and this quarter. Although the implications of the global economic downturn are uneven across Michigan, generally they're more severe in the East than West, and we now expect weakness to be more prolonged than originally assumed in our plan. Sales in the first quarter were as budgeted. We are however reflecting a…

I don't think I said I had confidence the Commission would approve a full decoupling mechanism, although it is something that they have talked about here in Michigan. What I was referring to is the decoupling mechanism associated with the Energy Efficiency programs, and the staff has recommended approval of that although they recommended approval of it consistent with the Commission's ultimate approval of our electric rate case. There and has been a very strong support for that amongst the staff and others in the city. Brian Russo - Ladenburg Thalmann & Co.: Okay, and absent a decoupling mechanism how might your ROE be sensitive to that?

Obviously, that depends on sales. The decoupling associated with Energy Efficiency, obviously is a program where any sales reductions we're able to achieve by implementing those programs therefore wouldn't affect our overall earnings. Obviously without a full blown decoupling mechanism, we continue to be exposed to things like weather, like we always had been, and the sales downturn that we are currently seeing. Although as we said, those are largely industrial where our lower margins occur and we then are offset by some demand improvement. So we are going to continue to have to manage the business as we have, adjust spending and that sort of thing if the sales are not what we expect it to be.

Brian, I turn you and everyone to the sensitivity slide that Dave was referring to, and that will show you what happens in electric and gas in terms of every 1% change in sales. Remember, I think, we've tried to be very realistic in our forecast for this year, particularly around the industrial situation. Brian Russo - Ladenburg Thalmann & Co.: Has you capital expenditure outlook remained consistent from your last update?

Yes. We really haven't changed anything there. You recall that's down from what we originally filed in our rate case and what our forecast was last year, but we haven't changed for the remaining of this year. Brian Russo - Ladenburg Thalmann & Co.: Okay. Dave, if you could just talk a little bit more about the staff recommendation seemed a lot lower than some of us were expecting, and as you mentioned earlier, they seemed to be using more historical data than forward looking. Can you give us a sense of what you might include in your rebuttal testimony to support your capital budget?

I think what we have said in a way of our filing yesterday of our proposed tariff's for self implementation of $179 million is consistent with what we think we actually need to serve our customers appropriately, meet our service requirements and earn a reasonable return on investment at the 11% level the staff has recommended, and there is some differences there. Some of them are real differences, and that's why that $179 million is less than the $214. We did cutback on capital spending. There have been some changes in our cost-to-capital assumptions, because of when we make equity infusions in the utility and also across the short-term debt are lower than we'd originally assumed. We have also taken out some operating cost to our current budget. It is different than what was in the original filing, and we've reflected that in putting forward our $179 million. It is true that what the staff recommended, and you look at the methodology, and of course we just saw these numbers ourselves a couple of days ago, are really more historic based, so they look at historic capital spending in prior years and average those numbers. Frankly, even the numbers they used are incorrect, partly we think because of the numbers we gave them were partial year's numbers, and they interpret them as full year numbers. So we will be talking with them about that. Our assessment is even the $300 million number they used was actually about a $150 million lower than our actual numbers. But the more important issue there is, they have used sort of average historic capital numbers for the couple of years prior to this filing vis-à-vis our actual capital spending program for 2009. However, that may not be unreasonable for them just to take a shot at what we might be spending this year, but frankly, we are at higher levels than that. We haven't seen any indication that anybody thinks the numbers in the capital spending that we are doing this year is in any way imprudent. So we will be spending our time simply educating in our rebuttal, what are the actual capital numbers for this year, and what we are spending them on, and why do we think they are appropriate. Of course, we will be doing the same thing on the O&M side. They basically took historic spending and actually applied a negative CTI to those numbers from 2008. That's not what the actual experience is, and of course, we will have to defend that actual experience. But I would say generally speaking the staff used a more historic look, and I've indicated my comments, that's inconsistent with the new law which allows for our filing on a forward test year basis, and we'll be making that case, and going through those numbers in more specificity in our rebuttal.

Your next question comes from the line of Dan Eggers of Credit Suisse. Please proceed.

With the another reduction to the volume outlook, can you just give a little more color on what's you're seeing and which industrial customers are struggling more than others because you did more in the second and third quarters?

If you think about the first quarter and the 11% decline that we showed you, GM, Delphi probably make up about a third of that decline to give you a little bit of the texture, and then it is a little bit of other automotive suppliers, and then the general slowdown in the nationwide economy, whether its furniture makers or food makers or whatever. You see some of those folks slowing down a little bit. We look at that and we said, you know what, particularly with this announcement by GM of a longer shutdown in the summer. Nine weeks instead of perhaps two weeks, which could be followed by the other autos, we started thinking that that we better be a little conservative for the second quarter. That's part of the drive of why we take the industrial side down from 10% to 15%. Then, a general planning is, without really being specific at all about any of the industrials, we said we probably should see this thing continue in through the third quarter, and watch a decline of around 11% instead of 6%, at least held where we were in terms of that 11% thinking in the fourth quarter by taking the 6% drop a year ago, and adding that to another 5% drop this year. So the back part of the year is us just trying to be a little conservative, saying, we don't see a big turnaround occurring until we get into 2010. Near term, it is just really trying to take a look at specifics that we see from some of our customers. Add all that up, and that took our 2% reduction for our entire electric business down to about 3%, and that's still all included in our guidance.

Your next question comes from the line of Paul Ridzon of KeyBanc Capital Markets

Talk about the offsets to the lower sales forecast and where you see the opportunities to negate that?

It's fairly straightforward, and lot of that has to do with simply managing the miniscule O&M items in every different area. So, I can't give you major offsets. We are looking at moving one of the outages at one of our smaller plants into next year. Some minor reductions in our tree-trimming budget, and our storm assumptions; there are a lot of small items in individual departments. Then as Tom mentioned by the way, the impact on revenue is much smaller than the sales volumes might suggest because the demand component of the industrial rates is significant. In fact, we think under forecast the original impact of demand on our revenue, and furthermore, as people cut back shifts but continued to have shifts in, say, the day time, we don't lose that demand margin. So, when we look at the margin overall, the impact is a lot less than what the sales impacts might suggest, and we are making O&M changes to offset those.

If the final order differs from your self-implement, what happens with the interest rates?

Sure. The way the law is written, if there is a difference between what we self-implement and what the Commission orders, the first 25% of that difference, we pay an interest rate of LIBOR plus 500 basis points. If it exceeds 25%, that marginal amount over 25%, we have to refund as paying interest that are return on equity level, roughly 11%.

Late last year you borrowed against lines for potential tender or a conversion, have you repaid that line?

Yes, we did. In fact, when we give you our liquidity position, you see that included at the end of the year, we judged, we just didn't need that at the parent level. So we returned that to the banks.

Lastly, how big is the August of 10 maturity that you plan to refund?

$300 million.

(Operator instructions). Your next question comes from the line of Ted Heyn of Catapult. Please proceed.

I had a couple of quick questions. First, is it right to assume that the $179 million interim rate you proposed yesterday is what you've assumed in your guidance for the $1.25 level?

I had mentioned this in our last quarterly call that our philosophy around self-implementation is we would go through and look at our last six months of experience since the original filing, and we've changed some things. Sales experience has been a little bit different, on collectibles a little different. O&M is down a little bit. Capital spending is down a little bit, financing assumptions changed a little bit. So, we went through based on that six months, and said, what number do we need for the remainder of the year to serve our customers at the level we think they expect to be served, and to maintain our equipment and earn a fair rate of return. That's the number that we've self implemented.

Okay, but I guess my question was more; you talked about the amounts you'd have to pay on refunds if the final order came out different from what you self implemented. I guess the question is, would your $1.25 guidance be at risk, if in November, the ultimate decision came out below $179 million?

Sorry. I didn't really answer your question. By the way, if I said self- implemented, I should say that's what we proposed to self-implement. Of course, we can't do that yet. Well, it depends on what actually comes out obviously. For example, the staff made a proposal that we are ought to tree-trimming back fairly dramatically from the level of about $45 million where we are today as part of reducing the impact on customer rates. We can certainly do that. That hurts our reliability over the longer term somewhat, and as of right now, at least we have an active tree-trim tracker in place. So, we'd have to get some relief in that if we are going to do that. But that's one way in which obviously we could lower rate relief and still get to the same place. We can work look harder at squeezing O&M costs in other ways. There are certainly limits to how much we can do, and if the number was way too low, and we didn't have appropriate trackers, obviously it could affect our guidance. But we haven't seen that yet, and as I said before, I think we're confident we could make a strong case as to what is required.

Let me just be a little more direct. On the 179, if that's what we implement, we will not revise our guidance now.

The other question I had Tom was just on the accounting of this. I think we've talked about this before but given that staff proposal is much lower than what you guys have asked for. Is there any problem with actually having certainty about booking those rates from an accounting perspective, since they are subject to refund?

No. This is a lot like where we are when would have a staff view in any rate case. So, that doesn't give you a final strong enough information to say that that's your new best estimate. As you know in accounting lingo, the key words are best estimate, and our estimate is exactly what we intend to self-implement. So, therefore, there are no issues for that.

Your next question comes from the line of Greg Gordon of Citi Investment Research. Please proceed.

As we look at the rate case timeline and we choose to make the presumption, I don't see any reason not to make it, that there is a methodology issue and an education issue in the case not a prudence issue. At what point in the case time horizon will the staff have an opportunity to, if it decides to, revises its position. So, in other words, in terms of milestones, vis-à-vis the point where you are done communication with them, and they make a decision to agree or disagree with you, when would we see them update their position?

Whether they update their position or not will be the question. But normally that would happen in the briefing process or possibly in cross examination. The staff has made their filing. We'll make our rebuttals later on in May, and then there will be cross examination that occurs in June, and some times the staff through cross examination and often times because we've had discussion with them and said, this calculation doesn't look right or may be you misinterpreted some data we gave you. Sometimes they will correct that during cross examination, and then gives there is always an opportunity during the filing of their briefs. That will occur in sort of the August, September time frame

So we are talking about mid to late summer then is when we should be focused on cross examination of their briefs? The second question is, I think you inferred that the interim rate increase that your have requested takes into account modifications to your business plan, subsequent to the filing, including perhaps a modestly lower cap spending. You mentioned a $150 million number, so should we presume that the rate based number now is more like $6.15 billion pro forma for you having to adjust to economic conditions?

No I probably confused you. As I said earlier, we have not reduced our capital spending since we gave you guidance earlier on this year. We did reduce our capital spending from what we originally filed in the electric rate case; you recall we talked about that in the first quarter call. So, when I talked about a reduction, I was simply talking about a reduction from what we had originally filed vis-à-vis what's in our plan right now. And what's in our plan right now has not changed. Now, the $150 million is probably where I created some confusion, because what the staff did is look at the average capital spending over a couple to prior years, and came up with the number of $300 million less than what we have in our filing. Partly, that was we think, and we haven't been able to completely resolve this yet, but partly, we think we gave them some partial year data that they interpreted as full year data, and that $300 million, if you use their calculation would've been more like a $150 million if we close the gap on that data discrepancy. However, that doesn't mean that that's the right number. That is simply what's the staff's number would have generated, and what our actual number is for this year is higher and we have the same staff.

Okay, so you still think that the right rate base forecast is $6.3 billion?

Yes.

Your next question comes from the line of Mr. Neil Stein of Levin Capital. Please proceed.

Hi. I did have a couple of questions. The first, on the $179 million, I assume that's an annualized number. Could you say how much you'll actually recognize of that in 2009?

Well, it's basically from the time of self-implementation; you'll get that portion of it.

I imaged there was seasonal factors?

Due to the seasonality issue, it works out to about two-thirds.

Two-thirds? Okay. Then, specifically on this CapEx issue with respect to the staff recommendation, the way I interpret their filing, they seem to be saying that, your '08 CapEx is about $250 million lower than what you guys said it was? Which seems strange to the extent, I think it's a question, a fact not opinion as far as what your 2008 CapEx actually was. It happened in the past.

That's what I was referring to earlier. I think we gave them some data that either we conveyed it improperly or they misinterpreted. We are not sure yet, but that data is not quite right, and the actual spending for that year was higher.

Dave, would you say that, really, we've not had a scenario where we've had something disallowed when they see the real spending.

We don't see, I mean, what I see in the filing and I guess we're just talking about from what we've seen since the issues came out, and we haven't had a chance to have a full dialogue with the staff on this. But, what we think they did was simply take some average of prior years, and saying, what's in our case for this year, it appears to be inconsistent with what we spent in the past, and therefore, at least in their recommendation they simply incorporated a number that's more consistent with these past numbers. They haven't suggested to my knowledge that anything we're doing this year is imprudent or shouldn't be included in the rate base, and we'll work through that process. But at least our history has been that we've not had difficulty getting prudent capital expenditures in the rate base, and we certainly feel that everything that's in our plan is prudent.

Then, with respect to your going back to the statute, and that it authorizes you to do filing and self-implementation, the Commission does have authority there to delay it or issue a temporary order to delay it?

As I said before, this is all new, but let me tell you what the law says. There was concern when the law was passed that utilities could file some very ridicules thing and they could self-implement it, and the Commission could do nothing about it. So, they put something the law that basically said for good cause the Commission could intercede and prevent self implementation. Now, we don't think there is any good cause in this case. It certainly in our view isn't the intent that we go through and try to accelerate, and do a full blown rate case analysis in the six month period, but the six months is sufficient for somebody to judge whether or not what file is totally ridiculous. We don't think our case falls into there at all. But it is true that the Commission under the law for a quote, 'good cause', has the ability to intercede in the process, and this is new for the Commission, and new for us. I think the Commission is taking this cautiously, and making sure they appropriately consider a motion one the parties made for them to do that. I don't necessarily pretend that that means anything other than they are doing their job.

Is there any definition anywhere else in Michigan laws as far as what good cause means? What kind of standards there are going to use here in this case?

I am not a lawyer and so I won't opine as to what that means. I will just sort of take it at face value, but I am sure the lawyers will argue about what that all means, when the stuff is said and done. But, I think the Commission is likely to look at this in the same way I do at face value, and I certainly don't believe there is any good cause based on what we've given them. Like I said, wait and see what happens, because it's all new for all of us.

There are no further questions on the queue at this time.

We didn't have that many questions. We had some good questions, and I appreciate the opportunity to clarify some of those issues. I will take the fact that we didn't have that many questions to say that we didn't surprise anybody. We were indeed on track, and I think we've kind of come laid out what's going on the rest of the year, and of course we haven't changed our guidance. That's not to say we don't have continuing challenges to manage. We do. The economy is still challenging for us, we've got some rate case issues, and we'll continue to manage those as we have in the past. We feel pretty good about where we are at this stage of the process, and we'll continue to keep you informed as things develop. We appreciate your interest and appreciate your participation on the call today. Thanks.

This concludes today's conference. We thank everyone for your participation. Good day.