Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following combined Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) should be read in conjunction with the consolidated financial statements and accompanying notes in this combined Quarterly Report on Form 10-Q and the Evergy Companies' combined 2023 Form 10-K. None of the registrants make any representation as to information related solely to Evergy, Evergy Kansas Central or Evergy Metro other than itself.

EVERGY, INC.

EXECUTIVE SUMMARY

Evergy is a public utility holding company incorporated in 2017 and headquartered in Kansas City, Missouri. Evergy operates primarily through the following wholly-owned direct subsidiaries listed below.

• Evergy Kansas Central is an integrated, regulated electric utility that provides electricity to customers in the state of Kansas. Evergy Kansas Central has one active wholly-owned subsidiary with significant operations, Evergy Kansas South.

• Evergy Metro is an integrated, regulated electric utility that provides electricity to customers in the states of Missouri and Kansas.

• Evergy Missouri West is an integrated, regulated electric utility that provides electricity to customers in the state of Missouri.

• Evergy Transmission Company owns 13.5% of Transource with the remaining 86.5% owned by AEP Transmission Holding Company, LLC, a subsidiary of AEP. Transource is focused on the development of competitive electric transmission projects. Evergy Transmission Company accounts for its investment in Transource under the equity method.

Evergy Kansas Central also owns a 50% interest in Prairie Wind, which is a joint venture between Evergy Kansas Central and subsidiaries of AEP and Berkshire Hathaway Energy Company. Prairie Wind owns a 108-mile, 345 kV double-circuit transmission line that provides transmission service in the SPP. Evergy Kansas Central accounts for its investment in Prairie Wind under the equity method.

Evergy Kansas Central, Evergy Kansas South, Evergy Metro and Evergy Missouri West conduct business in their respective service territories using the name Evergy. Collectively, the Evergy Companies have approximately 15,800 MWs of owned generating capacity and renewable power purchase agreements and engage in the generation, transmission, distribution and sale of electricity to approximately 1.7 million customers in the states of

Kansas and Missouri. The Evergy Companies assess financial performance and allocate resources on a consolidated basis (i.e., operate in one segment).

Evergy Missouri West 2024 Rate Case Proceeding

In February 2024, Evergy Missouri West filed an application with the MPSC to request an increase to its retail revenues of approximately $104 million. Evergy Missouri West's request reflected a return on equity of 10.5% (with a capital structure composed of 52% equity) and increases related to the recovery of infrastructure investments made to improve reliability and enhance customer service and the inclusion of certain costs related to Dogwood and Crossroads, two natural gas plants. An evidentiary hearing in the case is scheduled to occur beginning in late September 2024 and new rates are expected to be effective in January 2025.

Evergy Missouri West Securitized Bonds

In February 2024, Evergy Missouri West Storm Funding issued, at a discount, $331.1 million of 5.10% Securitized Bonds in order to recover the extraordinary fuel and purchased power costs incurred as part of the February 2021 winter weather event. See Notes 4 and 7 to the consolidated financial statements for additional information regarding the securitized bonds.

Natural Gas Plant Investment

In April 2024, Evergy Missouri West purchased a joint ownership interest representing approximately 145 MW in Dogwood, an operational natural gas combined cycle facility located in Missouri, for approximately $60 million. The purchase was subject to terms and conditions listed in a stipulation and agreement approved by the MPSC allowing Evergy Missouri West to recover in rates a return of and return on the original cost, net of accumulated deprecation, of Dogwood. Evergy Missouri West shall also be allowed to recover in rates over two years a return of, but not a return on, the amount of the purchase price paid in excess of the original cost, net of accumulated depreciation, of Dogwood. In addition, net revenues generated from Evergy Missouri West's ownership of Dogwood from the date of closing to the date new rates become effective in Evergy Missouri West's current rate case shall not impact rates and shall be retained by Evergy Missouri West and reduce the amount of the purchase price paid in excess of the original cost, net of accumulated depreciation, of Dogwood to be recovered from customers.

Kansas Legislation

In April 2024, Kansas H.B. 2527 was signed into law by the Governor of Kansas. Most notably, H.B. 2527 includes a plant-in service accounting (PISA) provision that can be elected by Kansas electric public utilities to defer and recover as regulatory assets 90% of depreciation expense and associated return on investment linked to qualifying electric plants in service. Qualifying electric plant includes all rate base additions by an electric public utility, but not including transmission facilities or new electric generating units. The deferred depreciation and return on the associated regulatory asset are required to be included in determining the utility's rate base during subsequent general rate proceedings. The return on the deferred regulatory asset balances will be calculated using the weighted average cost of capital. Utilities that elect the PISA provision can make qualifying deferrals of depreciation and return from July 2024 through December 2030. Evergy Kansas Central and Evergy Metro expect to elect the PISA provision in their Kansas jurisdictions.

Additionally, the bill establishes new mechanisms for the recovery of costs associated with new gas-fired generating units. If the KCC decides investment in a new gas-fired generating unit is reasonable, the utility would be able to recover the return on 100% of the associated construction costs at its weighted average cost of capital. The cost recovery from customers could begin a year after construction begins. Rates could be adjusted every six months until new base rates reflecting the plant's costs are established.

In April 2024, Kansas S.B. 410 was signed into law by the Governor of Kansas. Most notably, S.B. 410 includes an exemption from all property and ad valorem taxes on certain electric generation facilities for which construction or installation begins on or after January 1, 2025.

Regulatory Proceedings

See Note 4 to the consolidated financial statements for information regarding other regulatory proceedings.

Wolf Creek Refueling Outage

Wolf Creek's most recent refueling outage began in March 2024 and the unit is expected to return to service in May 2024.

Earnings Overview

The following table summarizes Evergy's net income and diluted earnings per common share (EPS).

Three Months Ended March 31																					2024						Change						2023
																					(millions, except per share amounts)
Net income attributable to Evergy, Inc.																					$	122.7					$	(19.9)					$	142.6
Earnings per common share, diluted																					0.53						(0.09)						0.62

Net income attributable to Evergy, Inc. decreased for the three months ended March 31, 2024, compared to the same period in 2023, primarily due to higher depreciation and taxes other than income tax expense in the first quarter of 2024, 2023 mark-to-market gains related to forward contracts for natural gas and electricity and higher transmission and distribution expense; partially offset by new Evergy Kansas Central retail rates effective in December 2023, lower pension non-service costs and lower income tax expense.

Diluted EPS decreased for the three months ended March 31, 2024, compared to the same period in 2023, primarily due to the decrease in net income attributable to Evergy, Inc. discussed above.

For additional information regarding the change in net income, refer to the Evergy Results of Operations section within this MD&A.

Non-GAAP Measures

Evergy Utility Gross Margin (non-GAAP)

Utility gross margin (non-GAAP) is a financial measure that is not calculated in accordance with GAAP. Utility gross margin (non-GAAP), as used by the Evergy Companies, is defined as operating revenues less fuel and purchased power costs and amounts billed by the SPP for network transmission costs. Expenses for fuel and purchased power costs, offset by wholesale sales margin, are subject to recovery through cost adjustment mechanisms. As a result, changes in fuel and purchased power costs are offset in operating revenues with minimal impact on net income. In addition, SPP network transmission costs fluctuate primarily due to investments by SPP members for upgrades to the transmission grid within the SPP RTO. As with fuel and purchased power costs, changes in SPP network transmission costs are mostly reflected in the prices charged to customers with minimal impact on net income. The Evergy Companies' definition of utility gross margin (non-GAAP) may differ from similar terms used by other companies.

Utility gross margin (non-GAAP) is intended to aid an investor's overall understanding of results. Management believes that utility gross margin (non-GAAP) provides a meaningful basis for evaluating the Evergy Companies' operations across periods because utility gross margin (non-GAAP) excludes the revenue effect of fluctuations in fuel and purchased power costs and SPP network transmission costs. Utility gross margin (non-GAAP) is used internally to measure performance against budget and in reports for management and the Evergy Board. Utility gross margin (non-GAAP) should be viewed as a supplement to, and not a substitute for, gross margin, which is the most directly comparable financial measure prepared in accordance with GAAP. Gross margin under GAAP is defined as the excess of sales over cost of goods sold.

Utility gross margin (non-GAAP) differs from the GAAP definition of gross margin due to the exclusion of operating and maintenance expenses determined to be directly attributable to revenue-producing activities, depreciation and amortization and taxes other than income tax. See the Evergy Companies' Results of Operations for a reconciliation of utility gross margin (non-GAAP) to gross margin, the most comparable GAAP measure.

Adjusted Earnings (non-GAAP) and Adjusted EPS (non-GAAP)

Management believes that adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP) are representative measures of Evergy's recurring earnings, assists in the comparability of results and is consistent with how management reviews performance.

Evergy's adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP) for the three months ended March 31, 2024 were $124.7 million or $0.54 per share. For the three months ended March 31, 2023, Evergy's adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP) were $136.1 million or $0.59 per share.

In addition to net income attributable to Evergy, Inc. and diluted EPS, Evergy's management uses adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP) to evaluate earnings and EPS without:

i.the mark-to-market impacts of economic hedges related to Evergy Kansas Central's 8% ownership share of JEC; and

ii.the costs resulting from non-regulated energy marketing margins from the February 2021 winter weather event.

Adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP) are intended to aid an investor's overall understanding of results. Management believes that adjusted earnings (non-GAAP) provides a meaningful basis for evaluating Evergy's operations across periods because it excludes certain items that management does not believe are indicative of Evergy's ongoing performance or that can create period to period earnings volatility.

Adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP) are used internally to measure performance against budget and in reports for management and the Evergy Board. Adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP) are financial measures that are not calculated in accordance with GAAP and may not be comparable to other companies' presentations or more useful than the GAAP information provided elsewhere in this report.

The following table provides a reconciliation between net income attributable to Evergy, Inc. and diluted EPS as determined in accordance with GAAP and adjusted earnings (non-GAAP) and adjusted EPS (non-GAAP), respectively.

			Earnings (Loss)						Earnings (Loss) per Diluted Share						Earnings (Loss)						Earnings (Loss) per Diluted Share
Three Months Ended March 31			2024												2023
			(millions, except per share amounts)
Net income attributable to Evergy, Inc.			$	122.7					$	0.53					$	142.6					$	0.62
Non-GAAP reconciling items:
Mark-to-market impact of JEC economic hedges, pre-tax(a)			2.6						0.01						(8.4)						(0.04)
Non-regulated energy marketing costs related to February 2021 winter weather event, pre-tax(b)			—						—						0.1						—
Income tax (benefit) expense(c)			(0.6)						—						1.8						0.01
Adjusted earnings (non-GAAP)			$	124.7					$	0.54					$	136.1					$	0.59

(a)Reflects mark-to-market gains or losses related to forward contracts for natural gas and electricity entered into as economic hedges against fuel price volatility related to Evergy Kansas Central's 8% ownership share of JEC that are included in operating revenues on the consolidated statements of comprehensive income.

(b)Reflects non-regulated energy marketing incentive compensation costs related to the February 2021 winter weather event that are included in operating and maintenance expense on the consolidated statements of comprehensive income.

(c)Reflects an income tax effect calculated at a statutory rate of approximately 22%.

ENVIRONMENTAL MATTERS

See Note 10 to the consolidated financial statements for information regarding environmental matters.

RELATED PARTY TRANSACTIONS

See Note 11 to the consolidated financial statements for information regarding related party transactions.

EVERGY RESULTS OF OPERATIONS

The following table summarizes Evergy's comparative results of operations.

Three Months Ended March 31																					2024						Change						2023
																					(millions)
Operating revenues																					$	1,331.0					$	34.2					$	1,296.8
Fuel and purchased power																					376.4						22.2						354.2
SPP network transmission costs																					72.7						(8.5)						81.2
Operating and maintenance																					231.5						15.2						216.3
Depreciation and amortization																					276.1						12.7						263.4
Taxes other than income tax																					114.1						11.7						102.4
Income from operations																					260.2						(19.1)						279.3
Other income, net																					4.3						4.3						—
Interest expense																					133.2						10.1						123.1
Income tax expense																					7.3						(5.1)						12.4
Equity in earnings of equity method investees, net of income taxes																					1.8						(0.1)						1.9
Net income																					125.8						(19.9)						145.7
Less: Net income attributable to noncontrolling interests																					3.1						—						3.1
Net income attributable to Evergy, Inc.																					$	122.7					$	(19.9)					$	142.6

Gross Margin (GAAP) and Utility Gross Margin (non-GAAP)

The following table summarizes Evergy's gross margin (GAAP) and MWhs sold and reconciles Evergy's gross margin (GAAP) to Evergy's utility gross margin (non-GAAP). See "Executive Summary - Non-GAAP Measures", above for additional information regarding gross margin (GAAP) and utility gross margin (non-GAAP).

			Revenues and Expenses																		MWhs Sold
Three Months Ended March 31			2024						Change						2023						2024						Change						2023
Retail revenues			(millions)																		(thousands)
Residential			$	479.0					$	20.4					$	458.6					3,742						1						3,741
Commercial			432.7						2.7						430.0						4,290						(21)						4,311
Industrial			160.4						1.3						159.1						2,047						(17)						2,064
Other retail revenues			11.9						0.6						11.3						27						(4)						31
Total electric retail			1,084.0						25.0						1,059.0						10,106						(41)						10,147
Wholesale revenues			71.0						0.6						70.4						3,294						(254)						3,548
Transmission revenues			115.4						9.6						105.8						N/A						N/A						N/A
Other revenues			60.6						(1.0)						61.6						N/A						N/A						N/A
Operating revenues			1,331.0						34.2						1,296.8						13,400						(295)						13,695
Fuel and purchased power			(376.4)						(22.2)						(354.2)
SPP network transmission costs			(72.7)						8.5						(81.2)
Operating and maintenance(a)			(135.9)						(17.7)						(118.2)
Depreciation and amortization			(276.1)						(12.7)						(263.4)
Taxes other than income tax			(114.1)						(11.7)						(102.4)
Gross margin (GAAP)			355.8						(21.6)						377.4
Operating and maintenance(a)			135.9						17.7						118.2
Depreciation and amortization			276.1						12.7						263.4
Taxes other than income tax			114.1						11.7						102.4
Utility gross margin (non-GAAP)			$	881.9					$	20.5					$	861.4
(a) Operating and maintenance expenses which are deemed to be directly attributable to revenue-producing activities include plant operating and maintenance expenses at generating units and transmission and distribution operating and maintenance expenses and have been separately presented in order to calculate gross margin as defined under GAAP. These amounts exclude general and administrative expenses not directly attributable to revenue-producing activities of $95.6 million and $98.1 million for the three months ended March 31, 2024 and 2023, respectively.

Evergy's gross margin (GAAP) decreased $21.6 million for the three months ended March 31, 2024, compared to the same period in 2023 and Evergy's utility gross margin (non-GAAP) increased $20.5 million for the three months ended March 31, 2024, compared to the same period in 2023, both measures were driven by:

• an $11.0 million decrease due to 2023 mark-to-market gains related to forward contracts for natural gas and electricity entered into as economic hedges against fuel price volatility related to Evergy Kansas Central's 8% ownership share of JEC; partially offset by

• a $31.5 million net increase primarily from new retail rates in Kansas effective in December 2023 consisting of $39.9 million primarily from higher Evergy Kansas Central retail rates, partially offset by $6.7 million primarily from lower Evergy Metro retail rates.

Additionally, the decrease in Evergy's gross margin (GAAP) was also driven by:

• a $17.7 million increase in operating and maintenance expenses which are determined to be directly attributable to revenue producing activities primarily driven by a $10.4 million increase in transmission and distribution operating and maintenance expenses and a $4.3 million increase in plant operating and maintenance expense at Wolf Creek as further described below;

• a $12.7 million increase in depreciation and amortization as further described below; and

• an $11.7 million increase in taxes other than income tax as further described below.

Operating and Maintenance

Evergy's operating and maintenance expense increased $15.2 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $10.4 million increase in transmission and distribution operating and maintenance expenses primarily at Evergy Kansas Central driven by higher labor expense primarily due to a decrease in labor capitalization and higher employee headcount; and

• a $4.3 million increase in plant operating and maintenance expense at Wolf Creek at Evergy Kansas Central and Evergy Metro primarily due to higher material costs.

Depreciation and Amortization

Evergy's depreciation and amortization expense increased $12.7 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $7.4 million increase primarily due to a change in depreciation rates as a result of Evergy Kansas Central's and Evergy Metro's 2023 rate cases effective in December 2023; and

• a $5.3 million increase primarily due to capital additions.

Taxes Other than Income Tax

Evergy's taxes other than income tax increased $11.7 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by

• a $7.5 million increase at Evergy Kansas Central primarily due to the rebasing of property taxes as a result of Evergy Kansas Central's 2023 rate case effective in December 2023; and

• a $3.8 million increase at Evergy Metro primarily due to an increase in property taxes primarily driven by higher assessed property valuations.

Other Income, Net

Evergy's other income, net increased $4.3 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $10.2 million decrease in pension non-service costs primarily due to the resetting of pension expense in retail rates as a result of Evergy Kansas Central's and Evergy Metro's 2023 rate cases effective in December 2023; partially offset by

• a $3.8 million decrease in investment earnings primarily driven by a $2.0 million decrease in interest and dividend income primarily due to an decrease in carrying charges related to Evergy Missouri West's costs associated with the February 2021 winter weather event to be recovered through securitized bonds issued in February 2024; and

• a $3.5 million decrease due to recording lower Evergy Kansas Central corporate-owned life insurance (COLI) benefits in 2024.

Interest Expense

Evergy's interest expense increased $10.1 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $15.8 million increase due to the issuance of Evergy, Inc.'s $1.4 billion of 4.50% Convertible Notes in December 2023; and

• a $4.6 million increase due to the issuance of Evergy Kansas Central's $400.0 million of 5.70% First Mortgage Bonds (FMBs) in March 2023; partially offset by

• a $9.7 million decrease in interest expense on short-term borrowings primarily due to lower short-term debt balances in 2024.

Income Tax Expense

Evergy's income tax expense decreased $5.1 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by lower Evergy Metro pre-tax income in the first quarter of 2024.

LIQUIDITY AND CAPITAL RESOURCES

Evergy relies primarily upon cash from operations, short-term borrowings, long-term debt and equity issuances and its existing cash and cash equivalents to fund its capital requirements. Evergy's capital requirements primarily consist of capital expenditures, payment of contractual obligations and other commitments, and the payment of dividends to shareholders. See the Evergy Companies' combined 2023 Form 10-K for more information on Evergy's sources and uses of cash.

Short-Term Borrowings

As of March 31, 2024, Evergy had $1,406.8 million of available borrowing capacity under its master credit facility. The available borrowing capacity under the master credit facility consisted of $199.3 million for Evergy, Inc., $487.5 million for Evergy Kansas Central, $337.0 million for Evergy Metro and $383.0 million for Evergy Missouri West. The Evergy Companies' borrowing capacity under the master credit facility also supports their issuance of commercial paper. See Note 6 to the consolidated financial statements for more information regarding the master credit facility.

Along with cash flows from operations and receivable sales facilities, Evergy generally uses borrowings under its master credit facility and the issuance of commercial paper to meet its day-to-day cash flow requirements. Evergy may also utilize these short-term borrowings to repay maturing long-term debt until the long-term debt is able to be refinanced. Evergy believes that its existing cash on hand and available borrowing capacity under its master credit facility provide sufficient liquidity for its existing capital requirements.

Significant Debt Issuances

See Note 7 to the consolidated financial statements for information regarding significant debt issuances.

Credit Ratings

In May 2024, Moody's Investor Service changed Evergy Missouri West's outlook from Stable to Negative, and affirmed credit ratings as detailed in the following table.

			Moody's
			Investors Service**(a)**
Evergy Missouri West
Corporate Credit Rating						Baa2
Senior Secured Debt						A3
Commercial Paper						P-2

(a)A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time by the assigning rating agency.

Pensions

For the three months ended March 31, 2024, Evergy made no cash pension contributions. Evergy expects to make cash pension contributions of $38.6 million in 2024. For the three months ended March 31, 2024, Evergy made post-retirement benefit contributions of $0.4 million. Evergy expects to make additional post-retirement benefit contributions of $0.4 million in 2024. See Note 5 to the consolidated financial statements for additional information on Evergy's pension and post-retirement plans.

Debt Covenants

As of March 31, 2024, Evergy was in compliance with all debt covenants under the master credit facility and certain debt instruments that contain restrictions that require the maintenance of certain capitalization and leverage ratios. See Note 6 to the consolidated financial statements for more information.

Cash Flows

The following table presents Evergy's cash flows from operating, investing and financing activities.

Three Months Ended March 31			2024			2023
			(millions)
Cash Flows from Operating Activities			$	317.3		$	362.9
Cash Flows used in Investing Activities			(583.2)			(496.9)
Cash Flows from Financing Activities			303.6			137.2

Cash Flows from Operating Activities

Evergy's cash flows from operating activities decreased $45.6 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by a decrease in cash receipts for retail electric sales in 2024 primarily due to the collection of lower December receivables in January 2024 compared to the same period in 2023.

Cash Flows used in Investing Activities

Evergy's cash flows used in investing activities increased $86.3 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $90.9 million increase in additions to property, plant and equipment due to increases at Evergy Kansas Central and Evergy Missouri West of $53.6 million and $39.2 million, respectively, primarily due to increased spending for a variety of capital projects including transmission and distribution projects related to grid resiliency and other infrastructure improvements.

Cash Flows from Financing Activities

Evergy's cash flows from financing activities increased $166.4 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $300.0 million increase due to lower retirements of long-term debt, net due to Evergy Metro's repayment of $300.0 million of 3.15% Senior Notes in March 2023; partially offset by

• a $74.5 million decrease in short-term debt borrowings due to lower commercial paper borrowings for the first quarter of 2024; and

• a $67.6 million decrease in proceeds from long-term debt, net due to Evergy Kansas Central's issuance of $400.0 million of 5.70% FMBs in March 2023; partially offset by Evergy Missouri West's issuance of $331.1 million of 5.10% Securitized Bonds in February 2024.

EVERGY KANSAS CENTRAL, INC.

MANAGEMENT'S NARRATIVE ANALYSIS OF RESULTS OF OPERATIONS

The below results of operations and related discussion for Evergy Kansas Central is presented in a reduced disclosure format in accordance with General Instruction (H)(2)(a) to Form 10-Q.

The following table summarizes Evergy Kansas Central's comparative results of operations.

Three Months Ended March 31			2024						Change						2023
			(millions)
Operating revenues			$	693.2					$	14.6					$	678.6
Fuel and purchased power			138.6						(5.8)						144.4
SPP network transmission costs			72.7						(8.5)						81.2
Operating and maintenance			116.3						8.7						107.6
Depreciation and amortization			139.1						15.0						124.1
Taxes other than income tax			63.2						7.5						55.7
Income from operations			163.3						(2.3)						165.6
Other income, net			5.4						4.8						0.6
Interest expense			55.8						3.4						52.4
Income tax expense			2.1						(6.3)						8.4
Equity in earnings of equity method investees, net of income taxes			0.8						(0.2)						1.0
Net income			111.6						5.2						106.4
Less: Net income attributable to noncontrolling interests			3.1						—						3.1
Net income attributable to Evergy Kansas Central, Inc.			$	108.5					$	5.2					$	103.3

Evergy Kansas Central Gross Margin (GAAP) and Utility Gross Margin (non-GAAP)

The following table summarizes Evergy Kansas Central's gross margin (GAAP) and MWhs sold and reconciles Evergy Kansas Central's gross margin (GAAP) to Evergy Kansas Central's utility gross margin (non-GAAP). See "Executive Summary - Non-GAAP Measures" for additional information regarding gross margin (GAAP) and utility gross margin (non-GAAP).

			Revenues and Expenses																		MWhs Sold
Three Months Ended March 31			2024						Change						2023						2024						Change						2023
Retail revenues			(millions)																		(thousands)
Residential			$	214.3					$	22.2					$	192.1					1,501						49						1,452
Commercial			183.6						5.5						178.1						1,658						(14)						1,672
Industrial			106.0						(2.5)						108.5						1,274						(45)						1,319
Other retail revenues			6.1						1.8						4.3						10						—						10
Total electric retail			510.0						27.0						483.0						4,443						(10)						4,453
Wholesale revenues			68.1						0.5						67.6						2,546						(98)						2,644
Transmission revenues			108.9						8.3						100.6						N/A						N/A						N/A
Other revenues			6.2						(21.2)						27.4						N/A						N/A						N/A
Operating revenues			693.2						14.6						678.6						6,989						(108)						7,097
Fuel and purchased power			(138.6)						5.8						(144.4)
SPP network transmission costs			(72.7)						8.5						(81.2)
Operating and maintenance (a)			(65.7)						(11.8)						(53.9)
Depreciation and amortization			(139.1)						(15.0)						(124.1)
Taxes other than income tax			(63.2)						(7.5)						(55.7)
Gross margin (GAAP)			213.9						(5.4)						219.3
Operating and maintenance (a)			65.7						11.8						53.9
Depreciation and amortization			139.1						15.0						124.1
Taxes other than income tax			63.2						7.5						55.7
Utility gross margin (non-GAAP)			$	481.9					$	28.9					$	453.0
(a) Operating and maintenance expenses which are deemed to be directly attributable to revenue-producing activities include plant operating and maintenance expenses at generating units and transmission and distribution operating and maintenance expenses and have been separately presented in order to calculate gross margin as defined under GAAP. These amounts exclude general and administrative expenses not directly attributable to revenue-producing activities of $50.6 million and $53.7 million for the three months ended March 31, 2024 and 2023, respectively.

Evergy Kansas Central's gross margin (GAAP) decreased $5.4 million for the three months ended March 31, 2024, compared to the same period in 2023, and Evergy Kansas Central's utility gross margin (non-GAAP) increased $28.9 million for the three months ended March 31, 2024, compared to the same period in 2023, both measures were driven by:

• an $11.0 million decrease due to 2023 mark-to-market gains related to forward contracts for natural gas and electricity entered into as economic hedges against fuel price volatility related to Evergy Kansas Central's 8% ownership share of JEC; partially offset by

• a $39.9 million increase primarily from new Evergy Kansas Central retail rates effective in December 2023.

Additionally, the decrease in Evergy Kansas Central's gross margin (GAAP) was also driven by:

• a $15.0 million increase in depreciation and amortization expense as described further below; and

• an $11.8 million increase in operating and maintenance expenses which are determined to be directly attributable to revenue producing activities primarily driven by a $6.8 million increase in transmission and distribution operating and maintenance expenses and a $2.1 million increase in operating and maintenance expense at Wolf Creek as described further below; and

• a $7.5 million increase in taxes other than income tax as described further below.

Evergy Kansas Central Operating and Maintenance

Evergy Kansas Central's operating and maintenance expense increased $8.7 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $6.8 million increase in transmission and distribution operating and maintenance expenses primarily due to higher labor costs driven by a decrease in labor capitalization and higher employee headcount; and

• a $2.1 million increase in plant operating and maintenance expense at Wolf Creek primarily due to higher material costs.

Evergy Kansas Central Depreciation and Amortization

Evergy Kansas Central's depreciation and amortization expense increased $15.0 million for the three months ended March 31, 2024, compared to the same period in 2023, driven by:

• a $10.1 million increase primarily due to a change in depreciation rates as a result of Evergy Kansas Central's 2023 rate case effective in December 2023; and

• a $4.9 million increase primarily due to capital additions.

Evergy Kansas Central Taxes Other than Income Tax

Evergy Kansas Central's taxes other than income tax increased $7.5 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by the rebasing of property taxes as a result of Evergy Kansas Central's 2023 rate case effective in December 2023.

Evergy Kansas Central Other Income, Net

Evergy Kansas Central's other income, net increased $4.8 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $4.5 million decrease in pension non-service costs primarily due to the resetting of pension expense in retail rates as a result of Evergy Kansas Central's 2023 rate cases effective in December 2023; and

• a $2.7 million increase in equity allowance for funds used during construction (AFUDC) principally driven by lower short-term debt balances in 2024; partially offset by

• a $3.5 million decrease due to recording lower COLI benefits in 2024.

Evergy Kansas Central Interest Expense

Evergy Kansas Central's interest expense increased $3.4 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $4.6 million increase due to the issuance of $400.0 million of 5.70% FMBs in March 2023; and

• a $4.4 million increase due to the issuance of $300.0 million of 5.90% FMBs in November 2023; partially offset by

• a $5.2 million decrease in interest expense on short-term borrowings primarily due to lower short-term debt balances in 2024.

Evergy Kansas Central Income Tax Expense

Evergy Kansas Central's income tax expense decreased $6.3 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by a $5.1 million decrease primarily due to higher wind and other income tax credits in the first quarter of 2024 principally driven by the acquisition of the Persimmon Creek wind farm in 2023.

EVERGY METRO, INC.

MANAGEMENT'S NARRATIVE ANALYSIS OF RESULTS OF OPERATIONS

The below results of operations and related discussion for Evergy Metro is presented in a reduced disclosure format in accordance with General Instruction (H)(2)(a) to Form 10-Q.

The following table summarizes Evergy Metro's comparative results of operations.

Three Months Ended March 31			2024						Change						2023
			(millions)
Operating revenues			$	420.9					$	14.5					$	406.4
Fuel and purchased power			136.6						21.2						115.4
Operating and maintenance			67.9						2.6						65.3
Depreciation and amortization			100.5						(1.9)						102.4
Taxes other than income tax			37.3						3.8						33.5
Income from operations			78.6						(11.2)						89.8
Other expense, net			(1.9)						3.6						(5.5)
Interest expense			37.6						7.0						30.6
Income tax expense			6.4						(0.5)						6.9
Net income			$	32.7					$	(14.1)					$	46.8

Evergy Metro Gross Margin (GAAP) and Utility Gross Margin (non-GAAP)

The following table summarizes Evergy Metro's gross margin (GAAP) and MWhs sold and reconciles Evergy Metro's gross margin (GAAP) to Evergy Metro's utility gross margin (non-GAAP). See "Executive Summary - Non-GAAP Measures" for additional information regarding gross margin (GAAP) and utility gross margin (non-GAAP).

			Revenues and Expenses																		MWhs Sold
Three Months Ended March 31			2024						Change						2023						2024						Change						2023
Retail revenues			(millions)																		(thousands)
Residential			$	156.0					(2.0)						$	158.0					1,311						(18)						1,329
Commercial			171.2						(4.7)						175.9						1,800						(6)						1,806
Industrial			31.2						2.8						28.4						438						39						399
Other retail revenues			3.2						0.5						2.7						13						(4)						17
Total electric retail			361.6						(3.4)						365.0						3,562						11						3,551
Wholesale revenues			6.3						(5.1)						11.4						743						(83)						826
Transmission revenues			4.9						1.1						3.8						N/A						N/A						N/A
Other revenues			48.1						21.9						26.2						N/A						N/A						N/A
Operating revenues			420.9						14.5						406.4						4,305						(72)						4,377
Fuel and purchased power			(136.6)						(21.2)						(115.4)
Operating and maintenance (a)			(52.3)						(4.7)						(47.6)
Depreciation and amortization			(100.5)						1.9						(102.4)
Taxes other than income tax			(37.3)						(3.8)						(33.5)
Gross margin (GAAP)			94.2						(13.3)						107.5
Operating and maintenance (a)			52.3						4.7						47.6
Depreciation and amortization			100.5						(1.9)						102.4
Taxes other than income tax			37.3						3.8						33.5
Utility gross margin (non-GAAP)			$	284.3					$	(6.7)					$	291.0
(a) Operating and maintenance expenses which are deemed to be directly attributable to revenue-producing activities include plant operating and maintenance expenses at generating units and transmission and distribution operating and maintenance expenses and have been separately presented in order to calculate gross margin as defined under GAAP. These amounts exclude general and administrative expenses not directly attributable to revenue-producing activities of $15.6 million and $17.7 million for the three months ended March 31, 2024 and 2023, respectively.

Evergy Metro's gross margin (GAAP) decreased $13.3 million for the three months ended March 31, 2024, compared to the same period in 2023, and Evergy Metro's utility gross margin (non-GAAP) decreased $6.7 million for the three months ended March 31, 2024, compared to the same period in 2023, both measures were driven by:

• a $6.7 million decrease primarily from new Evergy Metro retail rates effective in December 2023.

Additionally, the decrease in Evergy Metro's gross margin (GAAP) was also driven by:

• a $4.7 million increase in operating and maintenance expenses which are determined to be directly attributable to revenue producing activities primarily driven by a $2.8 million increase in transmission and distribution operating and maintenance expense as further described below; and

• a $3.8 million increase in taxes other than income tax as further described below.

Evergy Metro Operating and Maintenance

Evergy Metro's operating and maintenance expense increased $2.6 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $2.8 million increase in transmission and distribution operating and maintenance expenses primarily due to a $1.5 million increase in vegetation management costs and higher labor costs driven by a decrease in labor capitalization and higher employee headcount; and

• a $2.2 million increase in plant operating and maintenance expense at Wolf Creek primarily due to higher material costs; partially offset by

• a $2.3 million decrease due to higher costs billed primarily to Evergy Missouri West for common use assets related to facilities and software assets.

Evergy Metro Taxes Other than Income Tax

Evergy Metro's taxes other than income tax increased $3.8 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by an increase in property taxes primarily driven by higher assessed property valuations.

Evergy Metro Other Expense, Net

Evergy Metro's other expense, net decreased $5.4 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $5.7 million decrease in pension non-service costs primarily due to the resetting of pension expense in retail rates as a result of Evergy Metro's 2023 rate case effective in December 2023; partially offset by

• a $2.3 million decrease in equity AFUDC principally driven by higher short-term debt and lower construction work in progress balances in the first quarter of 2024.

Evergy Metro Interest Expense

Evergy Metro's interest expense increased $7.0 million for the three months ended March 31, 2024, compared to the same period in 2023, primarily driven by:

• a $5.2 million increase in interest expense on short-term borrowings primarily due to higher short-term debt balances in the first quarter of 2024; and

• a $3.7 million increase due to the issuance of $300.0 million of 4.95% Mortgage Bonds in April 2023; partially offset by

• a $2.0 million decrease due to the repayment of $300.0 million of 3.15% Senior Notes at maturity in March 2023.