Attached files
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| 8-K - 8-K - NISOURCE INC. | a8-kheader3q15.htm |
Exhibit 99.1
November 3, 2015
FOR ADDITIONAL INFORMATION
Media | Investors |
Ken Stammen | Randy Hulen |
Manager, Communications | Vice President, Investor Relations |
(614) 460-5544 | (219) 647-5688 |
kstammen@nisource.com | rghulen@nisource.com |
NiSource Reports Third Quarter 2015 Earnings
• | Solid results, in line with expectations, reinforce strength of pure-play utility business plan |
• | Earnings growth driven by disciplined execution of infrastructure and environmental investments |
• | Ongoing investments provide long-term safety and reliability benefits to customers and communities |
• | Columbia Pipeline Group separation successfully completed; CPG results now classified as discontinued operations |
MERRILLVILLE, Ind. - NiSource Inc. (NYSE: NI) today announced net operating earnings (non-GAAP) of $18.5 million, or $0.06 per share, for the three months ended Sept. 30, 2015, compared with a loss of $8.7 million, or $0.03 per share, for the same period in 2014. Operating earnings (non-GAAP) for the third quarter were $115.8 million, compared to $84.7 million in the same prior year period.
On a GAAP basis, NiSource reported income from continuing operations of $14.8 million, or $0.05 per share, for the three months ended Sept. 30, 2015, compared with a loss of $17.2 million, or $0.05 per share, for the same period in 2014. Operating income for the third quarter was $109.7 million, compared to $71.1 million in the same prior year period. Schedules 1 and 2 of this news release contain a reconciliation of net operating earnings and operating earnings to GAAP net income and operating income, respectively.
On July 1, 2015, NiSource successfully completed the separation of Columbia Pipeline Group (CPG) through a distribution of all of the common stock of CPG held by NiSource to NiSource shareholders. As a result, CPG financial results for all periods are classified as discontinued operations.
“Our solid results during our first quarter as a pure-play utility company demonstrate that we’re well-positioned for sustainable long-term growth powered by steady and consistent earnings drivers,” said NiSource President and CEO Joseph Hamrock. “Our ongoing infrastructure and environmental investments deliver value for our customers and the communities we serve by enhancing safety and reliability and benefitting our environment.”
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Third Quarter 2015 Highlights
During the third quarter, NiSource remained on track to invest approximately $1.3 billion in 2015 as part of its $30 billion of long-term regulated utility infrastructure investment opportunities. It also made significant progress in advancing regulatory and customer programs in several key states.
Gas Distribution Operations
• | On Oct. 7, 2015, Columbia Gas of Massachusetts (CMA) received approval of its base rate case settlement by the Massachusetts Department of Public Utilities. The settlement with the Massachusetts Attorney General supports CMA’s continued effort to modernize its pipeline infrastructure and transform its operations to continue to serve customers safely and reliably. The approved settlement provides for increased annual revenues of $32.8 million beginning Nov. 1, 2015, with an additional $3.6 million annual increase starting Nov. 1, 2016. |
• | Columbia Gas of Pennsylvania (CPA) has reached a settlement with parties to its base rate case pending before the Pennsylvania Public Utility Commission. Under terms of the settlement, CPA’s annual revenues would increase by approximately $28 million, an outcome which supports continued infrastructure replacement, pipeline safety upgrades and enhanced employee training. The settlement also includes a tariff supporting the expansion of natural gas service into unserved areas. A decision on the settlement from the Pennsylvania commission, with new rates in effect, is expected by the end of the year. |
• | On Aug. 21, 2015, Columbia Gas of Virginia (CVA) received final commission approval of its 2014 base rate case. The commission reaffirmed the $25.2 million annual revenue increase. The approved case supports continued capital investments by CVA to improve its system and accommodate customer growth, as well as initiatives to enhance safety and reliability. |
• | On Oct. 23, 2015, CVA received regulatory approval of its application for a five-year extension of its infrastructure replacement program under the SAVE Act (Steps to Advance Virginia’s Energy Plan). The company plans to invest $150 million on its infrastructure modernization programs from 2016-2020. The approval provides for timely recovery of such investments through an annual tracker mechanism. |
• | Northern Indiana Public Service Co. (NIPSCO) continued executing on its seven-year, $817 million natural gas system modernization program. NIPSCO filed its semi-annual tracker update on Aug. 31, 2015 and expects to make its next filing in spring 2016. |
Electric Operations
• | Consistent with a May 26, 2015 settlement NIPSCO reached with the Indiana Office of Utility Consumer Counselor and NIPSCO’s largest industrial customers, the company filed a rate case and is expected to file a new seven-year electric infrastructure modernization plan with the Indiana Utility Regulatory Commission (IURC). The May 26 settlement remains pending before the IURC. |
• | NIPSCO’s first electric rate case in five years was filed with the IURC on Oct. 1, 2015. The case seeks to update rates to reflect the current costs of generating and distributing power, plus ongoing investments which are delivering substantial benefits to customers including programs that have reduced the duration of power outages by 40 percent. The request also seeks to create a bill payment assistance program for low-income electric customers during the summer cooling season. A decision by the IURC is expected in the third quarter of 2016. |
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• | NIPSCO’s Michigan City flue gas desulfurization unit is set to be placed in service by the end of the year - on schedule and on budget. The approximately $255 million project, supported with cost recovery, improves air quality and helps ensure NIPSCO’s generation fleet remains in compliance with current environmental regulations. It also helps ensure that NIPSCO can continue offering low-cost, reliable and efficient generating capacity for its customers. |
• | Progress also continued on two major electric transmission projects designed to enhance region-wide system flexibility and reliability. Right-of-way acquisition and permitting are under way for both projects and substation construction has begun on both projects. These projects involve an investment of approximately $500 million for NIPSCO and are anticipated to be in service by the end of 2018. |
2016 Guidance, Growth Commitments, Reaffirmed
NiSource CEO Joseph Hamrock reaffirmed that NiSource expects to deliver non-GAAP net operating earnings per share of $1.00 to $1.10 in 2016.
As previously disclosed, NiSource expects to make approximately $1.4 billion in planned infrastructure enhancement investments in 2016 as part of its $30 billion in infrastructure investment opportunities, which should support the company’s projected long-term earnings and dividend growth projections of 4-6% annually.
NiSource remains committed to maintaining solid, investment grade credit ratings. Standard & Poor’s rates NiSource at BBB+, Fitch Ratings’ outlook on NiSource is BBB- (positive) and Moody’s rates NiSource at Baa2. As of Sept. 30, 2015, NiSource maintained $1.6 billion in net available liquidity.
Third Quarter 2015 Operating Earnings - Segment Results (non-GAAP)
NiSource's consolidated operating earnings (non-GAAP) for the three months ended Sept. 30, 2015, were $115.8 million, compared to $84.7 million for the same period in 2014. Operating earnings (non-GAAP) for NiSource’s business segments for the three months ended Sept. 30, 2015, are discussed below. Refer to Schedule 2 for a reconciliation of operating earnings (non-GAAP) to GAAP operating income.
Gas Distribution Operations reported operating earnings of $21.6 million for the three months ended Sept. 30, 2015, compared with operating earnings of $1.0 million for the same prior year period. Net revenues, excluding the impact of trackers, increased by $18.5 million primarily attributable to the implementation of rates under Columbia Gas of Ohio's (COH) approved infrastructure replacement program, as well as the impact of new rates at CVA and CPA.
Operating expenses, excluding the impact of trackers, decreased by $2.1 million from the comparable 2014 period.
Electric Operations reported operating earnings of $101.6 million for the three months ended Sept. 30, 2015, compared with operating earnings of $90.2 million for the same prior year period. Net revenues, excluding the impact of trackers, decreased by $0.8 million from the comparable 2014 period.
Operating expenses, excluding the impact of trackers, decreased by $12.2 million from the comparable 2014 period primarily as a result of lower employee and administrative costs.
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Corporate and Other Operations reported an operating earnings loss of $7.4 million for the three months ended Sept. 30, 2015, compared with an operating earnings loss of $6.5 million for the three months ended Sept. 30, 2014.
Other Items
Interest expense, net was $94.9 million for the three months ended Sept. 30, 2015 compared to interest expense, net of $94.7 million for the same prior year period.
Other, net reflected income of $5.8 million compared to income of $5.7 million in the comparable 2014 period.
Income taxes were $8.2 million for the three months ended Sept. 30, 2015 compared to $4.4 million for the same prior year period.
Nine Month Period 2015 Operating Earnings - Segment Results (non-GAAP)
NiSource's consolidated operating earnings (non-GAAP) for the nine months ended Sept. 30, 2015, were $583.2 million, compared to $550.7 million for the same period in 2014. Operating earnings (non-GAAP) for NiSource’s business segments for the nine months ended Sept. 30, 2015, are discussed below. Refer to Schedule 2 for a reconciliation of operating earnings (non-GAAP) to GAAP operating income.
Gas Distribution Operations reported operating earnings of $383.0 million for the nine months ended Sept. 30, 2015, compared with operating earnings of $343.6 million for the same prior year period. Net revenues, excluding the impact of trackers, increased by $78.6 million primarily attributable to increases in regulatory and service programs, including the impact of new rates at CPA and CVA and the implementation of rates under COH's approved infrastructure replacement program.
Operating expenses, excluding the impact of trackers, increased by $39.2 million due primarily to increased employee and administrative costs, higher depreciation and increased property taxes.
Electric Operations reported operating earnings of $225.4 million for the nine months ended Sept. 30, 2015, compared with operating earnings of $224.2 million for the same prior year period. Net revenues, excluding the impact of trackers, decreased by $2.8 million from the comparable 2014 period.
Operating expenses, excluding the impact of trackers, decreased by $4.0 million from the comparable 2014 period.
Corporate and Other Operations reported an operating earnings loss of $25.2 million for the nine months ended Sept. 30, 2015, compared with an operating earnings loss of $17.1 million for the nine months ended Sept. 30, 2014. The increase in operating earnings loss is primarily due to higher employee and administrative costs.
Other Items
Interest expense, net was $285.9 million for the nine months ended Sept. 30, 2015 compared to interest expense, net of $287.4 million for the same prior year period.
Other, net reflected income of $11.6 million compared to income of $13.4 million in 2014.
The effective tax rate of net operating earnings was 35.5 percent compared to 36.1 percent for the same period last year.
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About NiSource
NiSource Inc. (NYSE: NI) is one of the largest fully-regulated utility companies in the United States, serving approximately 3.5 million natural gas customers and 500,000 electric customers across seven states through its local Columbia Gas and NIPSCO brands. Based in Merrillville, Indiana, NiSource’s more than 7,000 employees are focused on safely delivering reliable and affordable energy to our customers and communities we serve. NiSource has been designated a World’s Most Ethical Company by the Ethisphere Institute since 2012 and is a member of the Dow Jones Sustainability - North America Index. Additional information about NiSource, its investments in modern infrastructure and systems, its commitments and its local brands can be found at
www.nisource.com. NI-F
Regulation G Disclosure Statement
This press release includes NiSource’s financial results with respect to net operating earnings from continuing operations and operating earnings, which are non-GAAP financial measures as defined by the SEC’s Regulation G. The Company includes such measures because management believes they permit investors to view the Company’s performance using the same tools that management uses and to better evaluate the Company’s ongoing business performance. It should be noted that there will likely be differences between these non-GAAP financial measures and GAAP equivalents due to various factors, including, but not limited to, weather, restructuring, environmental, the impact of asset sales and asset impairments, and separation related costs and expenses and accounting changes. NiSource is not able to estimate the impact of such factors on GAAP earnings and, as such, is not providing earnings guidance on a GAAP basis.
Forward-Looking Statements
This news release contains forward-looking statements within the meaning of federal securities laws. These forward-looking statements are subject to various risks and uncertainties. Examples of forward-looking statements in this release include statements and expectations regarding NiSource’s business, performance and growth. Factors that could cause actual results to differ
materially from the projections, forecasts, estimates and expectations discussed in this release include, but are not limited to, NiSource’s debt obligations and ability to comply with related covenants, changes in NiSource’s credit rating, growth opportunities for NiSource’s businesses, changes in general economic and market conditions, regulatory rate reviews and proceedings, increased competition in deregulated energy markets, compliance with environmental laws, fluctuations in weather, climate change, natural disasters, acts of terrorism and other catastrophic events, economic conditions in certain industries, fluctuations in the price of energy commodities, counterparty credit risk, any impairment of goodwill and definite-lived intangible assets, changes in taxation or accounting principles, accidents and other operating risks, aging infrastructure, disruptions in information technology and cyber-attacks, NiSource’s ability to achieve the intended benefits of the separation and other matters set forth in the “Risk Factors” section in NiSource’s 2014 Form 10-K and other filings with the Securities and Exchange Commission, many of which are beyond the control of NiSource. In addition, the relative contributions to profitability by each segment, and the assumptions underlying the forward-looking statements relating thereto, may change over time. NiSource expressly disclaims any duty to update, supplement or amend any of its forward-looking statements contained in this release, whether as a result of new information, subsequent events or otherwise, except as required by applicable law.
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NiSource Inc.
Consolidated Net Operating Earnings (Non-GAAP)
(unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(in millions, except per share amounts) | 2015 | 2014 | 2015 | 2014 | |||||||||||
Net Revenues | |||||||||||||||
Gas Distribution | $ | 209.7 | $ | 240.4 | $ | 1,582.8 | $ | 1,860.1 | |||||||
Gas Transportation | 172.1 | 170.5 | 739.9 | 710.4 | |||||||||||
Electric | 431.5 | 437.9 | 1,199.9 | 1,285.0 | |||||||||||
Other | 7.8 | 2.8 | 19.9 | 10.4 | |||||||||||
Gross Revenues | 821.1 | 851.6 | 3,542.5 | 3,865.9 | |||||||||||
Cost of Sales (excluding depreciation and amortization) | 209.1 | 262.3 | 1,307.3 | 1,769.4 | |||||||||||
Total Net Revenues | 612.0 | 589.3 | 2,235.2 | 2,096.5 | |||||||||||
Operating Expenses | |||||||||||||||
Operation and maintenance | 292.1 | 306.9 | 914.0 | 893.9 | |||||||||||
Operation and maintenance - trackers | 17.9 | 20.5 | 149.8 | 96.6 | |||||||||||
Depreciation and amortization | 126.9 | 122.6 | 380.1 | 361.2 | |||||||||||
Depreciation and amortization - trackers | 5.6 | 1.2 | 10.9 | 1.9 | |||||||||||
Other taxes | 45.1 | 45.4 | 143.7 | 139.0 | |||||||||||
Other taxes - trackers | 8.6 | 8.0 | 53.5 | 53.2 | |||||||||||
Total Operating Expenses | 496.2 | 504.6 | 1,652.0 | 1,545.8 | |||||||||||
Operating Earnings | 115.8 | 84.7 | 583.2 | 550.7 | |||||||||||
Other Income (Deductions) | |||||||||||||||
Interest expense, net | (94.9 | ) | (94.7 | ) | (285.9 | ) | (287.4 | ) | |||||||
Other, net | 5.8 | 5.7 | 11.6 | 13.4 | |||||||||||
Total Other Deductions | (89.1 | ) | (89.0 | ) | (274.3 | ) | (274.0 | ) | |||||||
Operating Earnings (Loss) From Continuing Operations | |||||||||||||||
Before Income Taxes | 26.7 | (4.3 | ) | 308.9 | 276.7 | ||||||||||
Income Taxes | 8.2 | 4.4 | 109.7 | 99.9 | |||||||||||
Net Operating Earnings (Loss) from Continuing Operations | 18.5 | (8.7 | ) | 199.2 | 176.8 | ||||||||||
GAAP Adjustment | (3.7 | ) | (8.5 | ) | (65.0 | ) | (0.1 | ) | |||||||
GAAP Income (Loss) from Continuing Operations | $ | 14.8 | $ | (17.2 | ) | $ | 134.2 | $ | 176.7 | ||||||
Basic Net Operating Earnings (Loss) Per Share from Continuing Operations | $ | 0.06 | $ | (0.03 | ) | $ | 0.63 | $ | 0.56 | ||||||
GAAP Basic Earnings (Loss) Per Share from Continuing Operations | $ | 0.05 | $ | (0.05 | ) | $ | 0.42 | $ | 0.56 | ||||||
Basic Average Common Shares Outstanding | 318.1 | 315.4 | 317.4 | 314.9 | |||||||||||
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NiSource Inc.
Segment Operating Earnings (Non-GAAP)
(unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
Gas Distribution Operations | |||||||||||||||
(in millions) | 2015 | 2014 | 2015 | 2014 | |||||||||||
Net Revenues | |||||||||||||||
Sales revenues | $ | 385.5 | $ | 412.1 | $ | 2,337.0 | $ | 2,575.5 | |||||||
Less: Cost of gas sold | 73.9 | 114.6 | 929.9 | 1,294.8 | |||||||||||
Net Revenues | 311.6 | 297.5 | 1,407.1 | 1,280.7 | |||||||||||
Operating Expenses | |||||||||||||||
Operation and maintenance | 187.4 | 194.8 | 588.2 | 565.9 | |||||||||||
Operation and maintenance - trackers | 9.0 | 14.0 | 126.0 | 78.5 | |||||||||||
Depreciation and amortization | 58.5 | 55.4 | 172.8 | 161.7 | |||||||||||
Other taxes | 26.5 | 24.3 | 83.6 | 77.8 | |||||||||||
Other taxes - trackers | 8.6 | 8.0 | 53.5 | 53.2 | |||||||||||
Total Operating Expenses | 290.0 | 296.5 | 1,024.1 | 937.1 | |||||||||||
Operating Earnings | $ | 21.6 | $ | 1.0 | $ | 383.0 | $ | 343.6 | |||||||
GAAP Adjustment | (1.6 | ) | (0.2 | ) | 11.9 | 18.8 | |||||||||
GAAP Operating Income | $ | 20.0 | $ | 0.8 | $ | 394.9 | $ | 362.4 | |||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
Electric Operations | |||||||||||||||
(in millions) | 2015 | 2014 | 2015 | 2014 | |||||||||||
Net Revenues | |||||||||||||||
Sales revenues | $ | 431.7 | $ | 438.0 | $ | 1,201.3 | $ | 1,286.1 | |||||||
Less: Cost of sales | 135.2 | 147.5 | 377.5 | 474.2 | |||||||||||
Net Revenues | 296.5 | 290.5 | 823.8 | 811.9 | |||||||||||
Operating Expenses | |||||||||||||||
Operation and maintenance | 101.3 | 114.0 | 325.9 | 337.1 | |||||||||||
Operation and maintenance - trackers | 8.9 | 6.5 | 23.8 | 18.1 | |||||||||||
Depreciation and amortization | 63.0 | 61.2 | 188.4 | 181.0 | |||||||||||
Depreciation and amortization - trackers | 5.6 | 1.2 | 10.9 | 1.9 | |||||||||||
Other taxes | 16.1 | 17.4 | 49.4 | 49.6 | |||||||||||
Total Operating Expenses | 194.9 | 200.3 | 598.4 | 587.7 | |||||||||||
Operating Earnings | $ | 101.6 | $ | 90.2 | $ | 225.4 | $ | 224.2 | |||||||
GAAP Adjustment | (3.1 | ) | (13.3 | ) | (11.2 | ) | (5.5 | ) | |||||||
GAAP Operating Income | $ | 98.5 | $ | 76.9 | $ | 214.2 | $ | 218.7 | |||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
Corporate and Other Operations | |||||||||||||||
(in millions) | 2015 | 2014 | 2015 | 2014 | |||||||||||
Operating Earnings Loss | $ | (7.4 | ) | $ | (6.5 | ) | $ | (25.2 | ) | $ | (17.1 | ) | |||
GAAP Adjustment | (1.4 | ) | (0.1 | ) | (3.5 | ) | (1.8 | ) | |||||||
GAAP Operating Loss | $ | (8.8 | ) | $ | (6.6 | ) | $ | (28.7 | ) | $ | (18.9 | ) | |||
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NiSource Inc.
Segment Volumes and Statistical Data
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||
Gas Distribution Operations | 2015 | 2014 | 2015 | 2014 | |||||||
Sales and Transportation (MMDth) | |||||||||||
Residential | 14.5 | 15.4 | 198.0 | 206.9 | |||||||
Commercial | 16.4 | 17.5 | 130.2 | 135.0 | |||||||
Industrial | 127.4 | 126.2 | 397.8 | 384.7 | |||||||
Off System | 5.2 | 7.1 | 24.7 | 35.6 | |||||||
Other | 0.1 | — | (0.2 | ) | (0.1 | ) | |||||
Total | 163.6 | 166.2 | 750.5 | 762.1 | |||||||
Weather Adjustment | 0.9 | — | (28.3) | (33.8) | |||||||
Sales and Transportation Volumes - Excluding Weather | 164.5 | 166.2 | 722.2 | 728.3 | |||||||
Heating Degree Days | 43 | 100 | 3,936 | 4,092 | |||||||
Normal Heating Degree Days | 85 | 85 | 3,576 | 3,576 | |||||||
% (Warmer) Colder than Normal | (49 | )% | 18 | % | 10 | % | 14 | % | |||
Customers | |||||||||||
Residential | 3,058,415 | 3,035,401 | |||||||||
Commercial | 277,525 | 276,923 | |||||||||
Industrial | 7,233 | 7,512 | |||||||||
Other | 14 | 15 | |||||||||
Total | 3,343,187 | 3,319,851 | |||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||
Electric Operations | 2015 | 2014 | 2015 | 2014 | |||||||
Sales (Gigawatt Hours) | |||||||||||
Residential | 1,001.9 | 915.2 | 2,584.6 | 2,604.6 | |||||||
Commercial | 1,066.7 | 1,031.6 | 2,935.8 | 2,932.0 | |||||||
Industrial | 2,270.3 | 2,504.7 | 6,990.7 | 7,567.6 | |||||||
Wholesale | 76.9 | 161.4 | 194.8 | 485.3 | |||||||
Other | 36.1 | 36.4 | 105.2 | 104.7 | |||||||
Total | 4,451.9 | 4,649.3 | 12,811.1 | 13,694.2 | |||||||
Weather Adjustment | 48.3 | 193.7 | 19.4 | 79.3 | |||||||
Sales Volumes - Excluding Weather | 4,500.2 | 4,843.0 | 12,830.5 | 13,773.5 | |||||||
Cooling Degree Days | 529 | 381 | 758 | 657 | |||||||
Normal Cooling Degree Days | 570 | 570 | 799 | 799 | |||||||
% Colder than Normal | (7 | )% | (33 | )% | (5 | )% | (18 | )% | |||
Electric Customers | |||||||||||
Residential | 403,468 | 401,683 | |||||||||
Commercial | 54,841 | 54,383 | |||||||||
Industrial | 2,351 | 2,364 | |||||||||
Wholesale | 746 | 751 | |||||||||
Other | 3 | 4 | |||||||||
Total | 461,409 | 459,185 | |||||||||
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NiSource Inc.
Schedule 1 – Reconciliation of Net Operating Earnings to GAAP
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(in millions, except per share amounts) | 2015 | 2014 | 2015 | 2014 | |||||||||||
Net Operating Earnings (Loss) from Continuing Operations | $ | 18.5 | $ | (8.7 | ) | $ | 199.2 | $ | 176.8 | ||||||
Items excluded from operating earnings | |||||||||||||||
Net Revenues: | |||||||||||||||
Weather - compared to normal | (3.9 | ) | (13.5 | ) | 11.5 | 13.0 | |||||||||
Operating Expenses: | |||||||||||||||
Transaction costs | (1.1 | ) | — | (3.1 | ) | — | |||||||||
Environmental costs | — | — | (10.0 | ) | — | ||||||||||
Loss on sale of assets | (1.1 | ) | (0.1 | ) | (1.2 | ) | (1.5 | ) | |||||||
Total items excluded from operating earnings | (6.1 | ) | (13.6 | ) | (2.8 | ) | 11.5 | ||||||||
Other Deductions: | |||||||||||||||
Loss on extinguishment of long-term debt | — | — | (97.2 | ) | — | ||||||||||
Income taxes - discrete items | — | — | (3.3 | ) | (7.0 | ) | |||||||||
Tax effect of above items | 2.4 | 5.1 | 38.3 | (4.6 | ) | ||||||||||
Total items excluded from net operating earnings | (3.7 | ) | (8.5 | ) | (65.0 | ) | (0.1 | ) | |||||||
GAAP Income (Loss) from Continuing Operations | $ | 14.8 | $ | (17.2 | ) | $ | 134.2 | $ | 176.7 | ||||||
Basic Average Common Shares Outstanding | 318.1 | 315.4 | 317.4 | 314.9 | |||||||||||
Basic Net Operating Earnings (Loss) Per Share from Continuing Operations | $ | 0.06 | $ | (0.03 | ) | $ | 0.63 | $ | 0.56 | ||||||
Items excluded from net operating earnings (after-tax) | (0.01 | ) | (0.02 | ) | (0.21 | ) | — | ||||||||
GAAP Basic Earnings (Loss) Per Share from Continuing Operations | $ | 0.05 | $ | (0.05 | ) | $ | 0.42 | $ | 0.56 | ||||||
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NiSource Inc.
Schedule 2 – Adjustments by Segment from Operating Earnings to GAAP
For the Quarter ended September 30,
2015 (in millions) | Gas Distribution | Electric | Corporate & Other | Total | ||||||||||||
Operating Earnings (Loss) | $ | 21.6 | $ | 101.6 | $ | (7.4 | ) | $ | 115.8 | |||||||
Net Revenues: | ||||||||||||||||
Weather - compared to normal | (0.8 | ) | (3.1 | ) | — | (3.9 | ) | |||||||||
Total Impact - Net Revenues | (0.8 | ) | (3.1 | ) | — | (3.9 | ) | |||||||||
Operating Expenses: | ||||||||||||||||
Transaction costs | — | — | (1.1 | ) | (1.1 | ) | ||||||||||
Loss on sale of assets | (0.8 | ) | — | (0.3 | ) | (1.1 | ) | |||||||||
Total Impact - Operating Expenses | (0.8 | ) | — | (1.4 | ) | (2.2 | ) | |||||||||
Total Impact - Operating Loss | $ | (1.6 | ) | $ | (3.1 | ) | $ | (1.4 | ) | $ | (6.1 | ) | ||||
Operating Income (Loss) - GAAP | $ | 20.0 | $ | 98.5 | $ | (8.8 | ) | $ | 109.7 | |||||||
2014 (in millions) | Gas Distribution | Electric | Corporate & Other | Total | ||||||||||||
Operating Earnings (Loss) | $ | 1.0 | $ | 90.2 | $ | (6.5 | ) | $ | 84.7 | |||||||
Net Revenues: | ||||||||||||||||
Weather - compared to normal | (0.2 | ) | (13.3 | ) | — | (13.5 | ) | |||||||||
Total Impact - Net Revenues | (0.2 | ) | (13.3 | ) | — | (13.5 | ) | |||||||||
Operating Expenses: | ||||||||||||||||
Loss on sale of assets | — | — | (0.1 | ) | (0.1 | ) | ||||||||||
Total Impact - Operating Expenses | — | — | (0.1 | ) | (0.1 | ) | ||||||||||
Total Impact - Operating Loss | $ | (0.2 | ) | $ | (13.3 | ) | $ | (0.1 | ) | $ | (13.6 | ) | ||||
Operating Income (Loss) - GAAP | $ | 0.8 | $ | 76.9 | $ | (6.6 | ) | $ | 71.1 | |||||||
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NiSource Inc.
Schedule 2 – Adjustments by Segment from Operating Earnings to GAAP
For the Nine Months ended September 30,
2015 (in millions) | Gas Distribution | Electric | Corporate & Other | Total | ||||||||||||
Operating Earnings (Loss) | $ | 383.0 | $ | 225.4 | $ | (25.2 | ) | $ | 583.2 | |||||||
Net Revenues: | ||||||||||||||||
Weather - compared to normal | 12.7 | (1.2 | ) | — | 11.5 | |||||||||||
Total Impact - Net Revenues | 12.7 | (1.2 | ) | — | 11.5 | |||||||||||
Operating Expenses: | ||||||||||||||||
Environmental costs | — | (10.0 | ) | — | (10.0 | ) | ||||||||||
Transaction costs | — | — | (3.1 | ) | (3.1 | ) | ||||||||||
Loss on sale of assets | (0.8 | ) | — | (0.4 | ) | (1.2 | ) | |||||||||
Total Impact - Operating Expenses | (0.8 | ) | (10.0 | ) | (3.5 | ) | (14.3 | ) | ||||||||
Total Impact - Operating Income (Loss) | $ | 11.9 | $ | (11.2 | ) | $ | (3.5 | ) | $ | (2.8 | ) | |||||
Operating Income (Loss) - GAAP | $ | 394.9 | $ | 214.2 | $ | (28.7 | ) | $ | 580.4 | |||||||
2014 (in millions) | Gas Distribution | Electric | Corporate & Other | Total | ||||||||||||
Operating Earnings (Loss) | $ | 343.6 | $ | 224.2 | $ | (17.1 | ) | $ | 550.7 | |||||||
Net Revenues: | ||||||||||||||||
Weather - compared to normal | 18.6 | (5.6 | ) | — | 13.0 | |||||||||||
Total Impact - Net Revenues | 18.6 | (5.6 | ) | — | 13.0 | |||||||||||
Operating Expenses: | ||||||||||||||||
Gain (Loss) on sale of assets | 0.2 | 0.1 | (1.8 | ) | (1.5 | ) | ||||||||||
Total Impact - Operating Expenses | 0.2 | 0.1 | (1.8 | ) | (1.5 | ) | ||||||||||
Total Impact - Operating Income (Loss) | $ | 18.8 | $ | (5.5 | ) | $ | (1.8 | ) | $ | 11.5 | ||||||
Operating Income (Loss) - GAAP | $ | 362.4 | $ | 218.7 | $ | (18.9 | ) | $ | 562.2 | |||||||
11
NiSource Inc.
Consolidated Income Statements (GAAP)
(unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
(in millions, except per share amounts) | 2015 | 2014 | 2015 | 2014 | |||||||||||
Net Revenues | |||||||||||||||
Gas Distribution | $ | 208.9 | $ | 240.3 | $ | 1,595.5 | $ | 1,878.8 | |||||||
Gas Transportation | 172.1 | 170.5 | 739.9 | 710.5 | |||||||||||
Electric | 428.4 | 424.6 | 1,198.7 | 1,279.4 | |||||||||||
Other | 7.8 | 2.8 | 19.9 | 10.4 | |||||||||||
Gross Revenues | 817.2 | 838.2 | 3,554.0 | 3,879.1 | |||||||||||
Cost of Sales (excluding depreciation and amortization) | 209.1 | 262.4 | 1,307.3 | 1,769.6 | |||||||||||
Total Net Revenues | 608.1 | 575.8 | 2,246.7 | 2,109.5 | |||||||||||
Operating Expenses | |||||||||||||||
Operation and maintenance | 311.1 | 327.4 | 1,076.9 | 990.5 | |||||||||||
Depreciation and amortization | 132.5 | 123.8 | 391.0 | 363.1 | |||||||||||
Loss on sale of assets | 1.1 | 0.1 | 1.2 | 1.5 | |||||||||||
Other taxes | 53.7 | 53.4 | 197.2 | 192.2 | |||||||||||
Total Operating Expenses | 498.4 | 504.7 | 1,666.3 | 1,547.3 | |||||||||||
Operating Income | 109.7 | 71.1 | 580.4 | 562.2 | |||||||||||
Other Income (Deductions) | |||||||||||||||
Interest expense, net | (94.9 | ) | (94.7 | ) | (285.9 | ) | (287.4 | ) | |||||||
Other, net | 5.8 | 5.7 | 11.6 | 13.4 | |||||||||||
Loss on early extinguishment of long-term debt | — | — | (97.2 | ) | — | ||||||||||
Total Other Deductions | (89.1 | ) | (89.0 | ) | (371.5 | ) | (274.0 | ) | |||||||
Income (Loss) from Continuing Operations before Income Taxes | 20.6 | (17.9 | ) | 208.9 | 288.2 | ||||||||||
Income Taxes | 5.8 | (0.7 | ) | 74.7 | 111.5 | ||||||||||
Income (Loss) from Continuing Operations | 14.8 | (17.2 | ) | 134.2 | 176.7 | ||||||||||
(Loss) Income from Discontinued Operations - net of taxes | (19.7 | ) | 48.6 | 108.5 | 199.1 | ||||||||||
Net (Loss) Income | (4.9 | ) | 31.4 | 242.7 | 375.8 | ||||||||||
Less: Net income attributable to noncontrolling interest | — | — | 15.6 | — | |||||||||||
Net (Loss) Income attributable to NiSource | $ | (4.9 | ) | $ | 31.4 | $ | 227.1 | $ | 375.8 | ||||||
Amounts attributable to NiSource: | |||||||||||||||
Income (Loss) from continuing operations | $ | 14.8 | $ | (17.2 | ) | $ | 134.2 | $ | 176.7 | ||||||
(Loss) Income from discontinued operations | (19.7 | ) | 48.6 | 92.9 | 199.1 | ||||||||||
Net (Loss) Income attributable to NiSource | $ | (4.9 | ) | $ | 31.4 | $ | 227.1 | $ | 375.8 | ||||||
Basic (Loss) Earnings Per Share | |||||||||||||||
Continuing operations | $ | 0.05 | $ | (0.05 | ) | $ | 0.42 | $ | 0.56 | ||||||
Discontinued operations | (0.07 | ) | 0.15 | 0.30 | 0.63 | ||||||||||
Basic (Loss) Earnings Per Share | $ | (0.02 | ) | $ | 0.10 | $ | 0.72 | $ | 1.19 | ||||||
Diluted (Loss) Earnings Per Share | |||||||||||||||
Continuing operations | $ | 0.05 | $ | (0.05 | ) | $ | 0.42 | $ | 0.56 | ||||||
Discontinued operations | (0.07 | ) | 0.15 | 0.29 | 0.63 | ||||||||||
Diluted (Loss) Earnings Per Share | $ | (0.02 | ) | $ | 0.10 | $ | 0.71 | $ | 1.19 | ||||||
Dividends Declared Per Common Share | $ | 0.31 | $ | 0.26 | $ | 0.83 | $ | 1.02 | |||||||
Basic Average Common Shares Outstanding | 318.1 | 315.4 | 317.4 | 314.9 | |||||||||||
Diluted Average Common Shares | 321.5 | 315.4 | 320.7 | 316.0 | |||||||||||
12
NiSource Inc.
Consolidated Balance Sheets (GAAP)
(unaudited)
(in millions) | September 30, 2015 | December 31, 2014 | |||||
ASSETS | |||||||
Property, Plant and Equipment | |||||||
Utility plant | $ | 18,484.8 | $ | 17,668.4 | |||
Accumulated depreciation and amortization | (6,811.5 | ) | (6,629.5 | ) | |||
Net utility plant | 11,673.3 | 11,038.9 | |||||
Other property, at cost, less accumulated depreciation | 17.4 | 18.5 | |||||
Net Property, Plant and Equipment | 11,690.7 | 11,057.4 | |||||
Investments and Other Assets | |||||||
Unconsolidated affiliates | 6.7 | 8.3 | |||||
Other investments | 195.8 | 204.8 | |||||
Total Investments and Other Assets | 202.5 | 213.1 | |||||
Current Assets | |||||||
Cash and cash equivalents | 31.7 | 24.9 | |||||
Restricted cash | 27.9 | 24.9 | |||||
Accounts receivable (less reserve of $20.7 and $24.9, respectively) | 500.5 | 920.8 | |||||
Gas inventory | 398.9 | 440.3 | |||||
Underrecovered gas costs | 7.1 | 32.0 | |||||
Materials and supplies, at average cost | 84.2 | 81.1 | |||||
Electric production fuel, at average cost | 81.1 | 64.8 | |||||
Exchange gas receivable | 19.7 | 28.3 | |||||
Assets of discontinued operations | — | 341.3 | |||||
Regulatory assets | 183.7 | 187.4 | |||||
Deferred income taxes | 227.1 | 214.2 | |||||
Prepayments and other | 75.9 | 106.5 | |||||
Total Current Assets | 1,637.8 | 2,466.5 | |||||
Other Assets | |||||||
Regulatory assets | 1,507.5 | 1,544.5 | |||||
Goodwill | 1,690.7 | 1,690.7 | |||||
Intangible assets | 256.4 | 264.7 | |||||
Assets of discontinued operations | — | 7,546.0 | |||||
Deferred charges and other | 70.3 | 83.4 | |||||
Total Other Assets | 3,524.9 | 11,129.3 | |||||
Total Assets | $ | 17,055.9 | $ | 24,866.3 | |||
13
NiSource Inc.
Consolidated Balance Sheets (GAAP) (continued)
(unaudited)
(in millions, except share amounts) | September 30, 2015 | December 31, 2014 | |||||
CAPITALIZATION AND LIABILITIES | |||||||
Capitalization | |||||||
Common Stockholders’ Equity | |||||||
Common stock - $0.01 par value, 400,000,000 shares authorized; 318,474,781 and 316,037,421 shares outstanding, respectively | $ | 3.2 | $ | 3.2 | |||
Additional paid-in capital | 5,078.6 | 4,787.6 | |||||
Retained (deficit) earnings | (1,182.7 | ) | 1,494.0 | ||||
Accumulated other comprehensive loss | (19.6 | ) | (50.6 | ) | |||
Treasury stock | (79.2 | ) | (58.9 | ) | |||
Total Common Stockholders’ Equity | 3,800.3 | 6,175.3 | |||||
Long-term debt, excluding amounts due within one year | 6,133.5 | 8,155.9 | |||||
Total Capitalization | 9,933.8 | 14,331.2 | |||||
Current Liabilities | |||||||
Current portion of long-term debt | 442.6 | 266.6 | |||||
Short-term borrowings | 107.2 | 1,576.9 | |||||
Accounts payable | 349.2 | 610.1 | |||||
Dividends payable | 49.3 | — | |||||
Customer deposits and credits | 255.4 | 280.9 | |||||
Taxes accrued | 137.0 | 169.2 | |||||
Interest accrued | 77.5 | 140.7 | |||||
Overrecovered gas and fuel costs | 169.2 | 45.6 | |||||
Exchange gas payable | 66.8 | 101.5 | |||||
Deferred revenue | 9.3 | 3.4 | |||||
Regulatory liabilities | 120.2 | 61.1 | |||||
Accrued liability for postretirement and postemployment benefits | 5.2 | 5.3 | |||||
Liabilities of discontinued operations | — | 369.0 | |||||
Legal and environmental | 36.8 | 22.7 | |||||
Accrued compensation and employee benefits | 125.9 | 166.8 | |||||
Other accruals | 121.7 | 144.5 | |||||
Total Current Liabilities | 2,073.3 | 3,964.3 | |||||
Other Liabilities and Deferred Credits | |||||||
Deferred income taxes | 2,513.9 | 2,380.0 | |||||
Deferred investment tax credits | 15.4 | 17.1 | |||||
Deferred credits | 99.4 | 100.9 | |||||
Accrued liability for postretirement and postemployment benefits | 665.2 | 733.9 | |||||
Liabilities of discontinued operations | — | 1,616.3 | |||||
Regulatory liabilities | 1,387.1 | 1,379.6 | |||||
Asset retirement obligations | 181.2 | 136.2 | |||||
Other noncurrent liabilities | 186.6 | 206.8 | |||||
Total Other Liabilities and Deferred Credits | 5,048.8 | 6,570.8 | |||||
Commitments and Contingencies | — | — | |||||
Total Capitalization and Liabilities | $ | 17,055.9 | $ | 24,866.3 | |||
14
NiSource Inc.
Statements of Consolidated Cash Flows (GAAP)
(unaudited)
Nine Months Ended September 30, (in millions) | 2015 | 2014 | |||||
Operating Activities | |||||||
Net Income | $ | 242.7 | $ | 375.8 | |||
Adjustments to Reconcile Net Income to Net Cash from Continuing Operations: | |||||||
Loss on early extinguishment of debt | 97.2 | — | |||||
Depreciation and amortization | 391.0 | 363.1 | |||||
Net changes in price risk management assets and liabilities | 2.0 | 1.9 | |||||
Deferred income taxes and investment tax credits | 60.1 | 110.1 | |||||
Deferred revenue | 7.3 | (0.4 | ) | ||||
Stock compensation expense and 401(k) profit sharing contribution | 38.6 | 50.2 | |||||
Loss on sale of assets | 1.2 | 1.5 | |||||
Income from unconsolidated affiliates | 0.8 | 0.6 | |||||
Income from discontinued operations - net of taxes | (108.5 | ) | (199.1 | ) | |||
Amortization of debt related costs | 6.8 | 7.5 | |||||
AFUDC equity | (7.7 | ) | (7.4 | ) | |||
Changes in Assets and Liabilities | |||||||
Accounts receivable | 420.3 | 360.3 | |||||
Inventories | 19.8 | (170.5 | ) | ||||
Accounts payable | (287.5 | ) | (228.7 | ) | |||
Customer deposits and credits | (25.5 | ) | (5.0 | ) | |||
Taxes accrued | (30.6 | ) | (31.1 | ) | |||
Interest accrued | (63.1 | ) | (54.7 | ) | |||
Over (Under) recovered gas and fuel costs | 148.5 | (19.2 | ) | ||||
Exchange gas receivable/payable | (26.1 | ) | (57.2 | ) | |||
Other accruals | (57.1 | ) | (29.5 | ) | |||
Prepayments and other current assets | 30.1 | 33.9 | |||||
Regulatory assets/liabilities | 111.1 | (18.1 | ) | ||||
Postretirement and postemployment benefits | (61.0 | ) | (86.7 | ) | |||
Deferred credits | (1.3 | ) | 10.7 | ||||
Deferred charges and other noncurrent assets | 10.8 | 5.5 | |||||
Other noncurrent liabilities | (13.6 | ) | 5.3 | ||||
Net Operating Activities from Continuing Operations | 906.3 | 418.8 | |||||
Net Operating Activities from Discontinued Operations | 287.6 | 467.7 | |||||
Net Cash Flows from Operating Activities | 1,193.9 | 886.5 | |||||
Investing Activities | |||||||
Capital expenditures | (923.4 | ) | (914.3 | ) | |||
Proceeds from disposition of assets | 4.3 | 1.6 | |||||
Restricted cash deposits | (3.0 | ) | (8.1 | ) | |||
Cash contributions from CPG | 3,798.2 | — | |||||
Other investing activities | (39.9 | ) | (7.4 | ) | |||
Net Investing Activities from (used for) Continuing Operations | 2,836.2 | (928.2 | ) | ||||
Net Investing Activities used for Discontinued Operations | (430.0 | ) | (584.0 | ) | |||
Net Cash Flows from (used for) Investing Activities | 2,406.2 | (1,512.2 | ) | ||||
Financing Activities | |||||||
Cash of CPG at Separation | (136.8 | ) | — | ||||
Issuance of long-term debt | — | 748.4 | |||||
Repayments of long-term debt and capital lease obligations | (1,859.1 | ) | (517.1 | ) | |||
Premiums and other debt related costs | (93.5 | ) | — | ||||
Change in short-term borrowings, net | (1,396.6 | ) | 612.3 | ||||
Issuance of common stock | 17.9 | 22.4 | |||||
Acquisition of treasury stock | (20.3 | ) | (10.2 | ) | |||
Dividends paid - common stock | (214.0 | ) | (239.2 | ) | |||
Net Financing Activities (used for) from Continuing Operations | (3,702.4 | ) | 616.6 | ||||
Net Financing Activities from Discontinued Operations | 108.6 | — | |||||
Net Cash Flows (used for) from Financing Activities | (3,593.8 | ) | 616.6 | ||||
Change in cash and cash equivalents from continuing operations | 40.1 | 107.2 | |||||
Change in cash and cash equivalents used for discontinued operations | (33.8 | ) | (116.3 | ) | |||
Change in cash included in discontinued operations | 0.5 | (0.1 | ) | ||||
Cash and cash equivalents at beginning of period | 24.9 | 26.5 | |||||
Cash and Cash Equivalents at End of Period | $ | 31.7 | $ | 17.3 | |||
15