Attached files
| file | filename |
|---|---|
| EX-99 - NEWS RELEASE - EVERSOURCE ENERGY | newsreleasedivestiture.htm |
| 8-K - CURRENT REPORT ON FORM 8-K - EVERSOURCE ENERGY | psnhthermalform_8kedg.htm |
Exhibit 99.2
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
On January 10, 2018, Public Service Company of New Hampshire (“PSNH”), a subsidiary of Eversource Energy (“Eversource”), closed its previously announced agreement to sell its thermal generating assets pursuant to the terms of a Purchase and Sale Agreement (the “Thermal Agreement”), dated as of October 11, 2017, with Granite Shore Power LLC. The thermal generating assets included approximately 1,100 MW of primarily fossil fueled electricity generation plants, including PSNH’s 50 MW wood-burning Northern Wood Power Project at its Schiller Station in Portsmouth, New Hampshire (“Thermal Generation Assets”). The original Purchase Price of $175 million was adjusted to reflect working capital adjustments, closing date adjustments and proration of taxes and fees prior to closing totaling approximately $40.9 million, resulting in net proceeds of approximately $134.1 million.
The following unaudited pro forma condensed consolidated income statements and balance sheet have been derived by the application of adjustments to PSNH’s historical financial statements as previously filed. The unaudited pro forma financial statements are presented for comparative purposes only and are not intended to be indicative of the balance sheet or statements of income which would have been realized had the sale of the Thermal Generation Assets been consummated as of the date or during the periods for which the unaudited pro forma financial statements are presented or for any future period or date.
| PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARY | ||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
| (Unaudited) |
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| As of September 30, |
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| Pro Forma |
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| Pro Forma Giving |
| (Thousands of Dollars) |
| 2017 |
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| Adjustments |
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| Effect to Adjustments |
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| ASSETS |
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| Current Assets: |
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| Cash | $ | 597 |
| $ | 134,155 | (a) | $ | 134,752 |
| Receivables, Net |
| 93,299 |
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| 93,299 |
| Accounts Receivable from Affiliated Companies |
| 24,331 |
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| 24,331 |
| Unbilled Revenue |
| 37,133 |
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| 37,133 |
| Taxes Receivable |
| - |
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| - |
| Fuel, Materials, Supplies and Inventory |
| 158,091 |
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| (120,434) | (b) |
| 37,657 |
| Regulatory Assets |
| 112,465 |
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| 112,465 |
| Prepayments and Other Current Assets |
| 3,797 |
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| (1,656) | (b) |
| 2,141 |
| Total Current Assets |
| 429,713 |
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| 12,066 |
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| 441,779 |
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| Property, Plant and Equipment, Net |
| 3,167,905 |
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| (549,247) | (b) |
| 2,618,658 |
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| Deferred Debits and Other Assets: |
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| Regulatory Assets |
| 244,561 |
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| 537,181 | (c) |
| 781,742 |
| Other Long-Term Assets |
| 51,740 |
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| 51,740 |
| Total Deferred Debits and Other Assets |
| 296,301 |
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| 537,181 |
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| 833,482 |
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| Total Assets | $ | 3,893,919 |
| $ | - |
| $ | 3,893,919 |
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| LIABILITIES & CAPITALIZATION |
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| Current Liabilities: |
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| Notes Payable to Eversource Parent | $ | 202,300 |
| $ | |
| $ | 202,300 |
| Long-Term Debt - Current Portion |
| 110,000 |
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| 110,000 |
| Accounts Payable |
| 92,201 |
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| 92,201 |
| Accounts Payable to Affiliated Companies |
| 42,788 |
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| 42,788 |
| Regulatory Liabilities |
| 7,923 |
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| 7,923 |
| Other Current Liabilities |
| 61,210 |
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| 61,210 |
| Total Current Liabilities |
| 516,422 |
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| - |
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| 516,422 |
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| Deferred Credits and Other Liabilities: |
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| Accumulated Deferred Income Taxes |
| 827,412 |
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| 827,412 |
| Regulatory Liabilities |
| 40,822 |
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| 40,822 |
| Accrued Pension, SERP and PBOP |
| 98,553 |
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| 98,553 |
| Other Long-Term Liabilities |
| 54,131 |
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| 54,131 |
| Total Deferred Credits and Other Liabilities |
| 1,020,918 |
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| - |
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| 1,020,918 |
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| Capitalization: |
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| Long-Term Debt |
| 892,581 |
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| 892,581 |
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| Common Stockholder's Equity: |
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| Common Stock |
| - |
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| - |
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| - |
| Capital Surplus, Paid In |
| 843,134 |
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| 843,134 |
| Retained Earnings |
| 625,012 |
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| 625,012 |
| Accumulated Other Comprehensive Loss |
| (4,148) |
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| (4,148) |
| Common Stockholder's Equity |
| 1,463,998 |
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| - |
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| 1,463,998 |
| Total Capitalization |
| 2,356,579 |
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| - |
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| 2,356,579 |
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| Total Liabilities and Capitalization | $ | 3,893,919 |
| $ | - |
| $ | 3,893,919 |
The accompanying notes are an integral part of these unaudited pro forma condensed consolidated financial statements.
| PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARY |
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| CONDENSED CONSOLIDATED STATEMENTS OF INCOME |
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| (Unaudited) |
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| For the Nine Months Ending |
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| Pro Forma |
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| Pro Forma Giving | |||||||||
| (Thousands of Dollars) |
| September 30, 2017 |
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| Adjustments |
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| Effect to Adjustments | |||||||||
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| Operating Revenues | $ | 733,572 |
| $ | (54,329) | (a) | $ | 461,265 | |||||||||
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| Operating Expenses: |
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| Purchased Power, Fuel and Transmission |
| 179,289 |
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| 39,632 | |||||||||
| Operations and Maintenance |
| 191,153 |
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| 142,923 | |||||||||
| Depreciation |
| 95,266 |
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| 64,174 | |||||||||
| Amortization of Regulatory Liabilities, Net |
| (10,658) |
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| (5,073) | |||||||||
| Energy Efficiency Programs |
| 11,040 |
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| 11,040 | |||||||||
| Taxes Other Than Income Taxes |
| 66,935 |
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| 59,442 | |||||||||
| Total Operating Expenses |
| 533,025 |
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| - |
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| 312,138 | |||||||||
| Operating Income |
| 200,547 |
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| (54,329) |
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| 149,127 | |||||||||
| Interest Expense |
| 38,676 |
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| - |
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| 28,063 | |||||||||
| Other Income, Net |
| 2,883 |
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| - |
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| 2,700 | |||||||||
| Income Before Income Tax Expense |
| 164,754 |
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| (54,329) |
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| 123,764 | |||||||||
| Income Tax Expense |
| 65,128 |
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| (21,999) | (b) |
| 48,530 | |||||||||
| Net Income | $ | 99,626 |
| $ | (32,329) |
| $ | 75,234 | |||||||||
The accompanying notes are an integral part of these unaudited pro forma condensed consolidated financial statements.
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| PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARY |
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| CONDENSED CONSOLIDATED STATEMENTS OF INCOME |
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| (Unaudited) |
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| For the Year Ending |
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| Pro Forma |
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| Pro Forma | ||||||||||
| (Thousands of Dollars) |
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| December 31, 2016 |
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| Adjustments |
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| Effect to Adjustments | ||||||||||
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| Operating Revenues |
| $ | 959,482 |
| $ | (52,310) | (a) | $ | 586,842 | ||||||||||
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| Operating Expenses: |
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| Purchased Power, Fuel and Transmission |
| 210,786 |
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| 32,852 | |||||||||||
| Operations and Maintenance |
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| 260,779 |
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| 188,864 | ||||||||||
| Depreciation |
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| 116,519 |
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| 79,445 | ||||||||||
| Amortization of Regulatory Assets, Net |
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| 11,170 |
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| 11,594 | ||||||||||
| Energy Efficiency Programs |
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| 14,204 |
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| 14,204 | ||||||||||
| Taxes Other Than Income Taxes |
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| 82,964 |
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| 72,369 | ||||||||||
| Total Operating Expenses |
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| 696,422 |
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| - |
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| 399,328 | ||||||||||
| Operating Income |
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| 263,060 |
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| (52,310) |
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| 187,514 | ||||||||||
| Interest Expense |
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| 50,040 |
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| 35,359 | ||||||||||
| Other Income, Net |
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| 1,329 |
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| 1,454 | ||||||||||
| Income Before Income Tax Expense |
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| 214,349 |
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| (52,310) |
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| 153,609 | ||||||||||
| Income Tax Expense |
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| 82,364 |
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| (17,897) | (b) |
| 61,582 | ||||||||||
| Net Income |
| $ | 131,985 |
| $ | (34,413) |
| $ | 92,027 | ||||||||||
The accompanying notes are an integral part of these unaudited pro forma condensed consolidated financial statements.
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
The unaudited pro forma condensed consolidated financial statements are based on PSNH’s historical consolidated financial statements as adjusted to give effect to the sale of the Thermal Generation Assets. The unaudited pro forma balance sheet as of September 30, 2017 depicts the impact of the sale as if it had occurred on September 30, 2017. The unaudited pro forma statements of income for the nine months ended September 30, 2017 and for the year ended December 31, 2016 depict the pro forma impact of the sale of the Thermal Generation Assets as if the transaction had occurred on January 1, 2016. The unaudited pro forma condensed consolidated financial statements have been prepared for comparative purposes only and do not purport to be indicative of future results of operations or financial condition. In PSNH’s pro forma income statements and balance sheet, the “Pro Forma Giving Effect to Adjustments” column represents the Company’s remaining operations following the sale of the Thermal Generation Assets.
2. Pro Forma Adjustments
The following adjustments for the unaudited pro forma income statements and balance sheet reflect the impact of PSNH’s sale of the Thermal Generation Assets on previously filed income statements for the year ended December 31, 2016 and for the nine months ended September 30, 2017, and balance sheet as of September 30, 2017. The pro forma income statements reflect the assumption that the estimated costs to purchase electric generation service supply contracts in the absence of the Thermal Generation Assets, in order to fulfill the energy needs of PSNH’s retail distribution customers for the periods presented, are equal to the total operating expenses incurred to operate the Thermal Generation Assets. Both costs are fully recovered in retail distribution rates to PSNH customers and therefore do not impact earnings.
Pro Forma Financial Statement Adjustments
The following income statement adjustments relate to PSNH’s sale of the Thermal Generation Assets.
| (a) | | Reflects the elimination of revenues associated with the activities of the Thermal Generation Assets that impacts earnings. The revenues associated with the collection of operating costs in customers’ rates were replaced with an equal estimate representing the cost of purchased power in customers’ rates. |
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| (b) | | Reflects the elimination of the income tax expense associated with the revenues of the Thermal Generation Assets that are impacting earnings. |
The following balance sheet adjustments generally relate to PSNH’s sale of the Thermal Generation Assets.
| (a) | | Reflects the receipt of cash proceeds of approximately $134 million from the sale of the Thermal Generation Assets, net of certain working capital adjustments. |
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| (b) | | Reflects the elimination of the Thermal Generation Assets, as well as Fuel, Materials, Supplies and Inventory. |
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| (c) | | Reflects the estimated amount of stranded costs that will be recoverable in future rates billed to PSNH's customers through securitization bonds, which will result in the full recovery of the Thermal Generation Assets, Fuel, Materials and Supplies. |