the audited financial statements of Dominion Energy for the year ended December 31, 2017;

the unaudited interim financial statements of Dominion Energy for the nine months ended September 30, 2018;

the audited financial statements of SCANA for the year ended December 31, 2017; and

the unaudited interim financial statements of SCANA for the nine months ended September 30, 2018.

ASSETS

Current Assets

Cash and cash equivalents

Customer receivables

Other receivables

Inventories

Regulatory assets

Assets held for sale

Other

Total current assets

Investments

Nuclear decommissioning trust funds

Investment in equity method affiliates

Other

Total investments

Property, Plant and Equipment

Property, plant and equipment

Accumulated depreciation, depletion and amortization

Total property, plant and equipment, net

Deferred Charges and Other Assets

Goodwill

Regulatory assets

Other

Total deferred charges and other assets

Total assets

LIABILITIES AND EQUITY

Current Liabilities

Securities due within one year

Short-term debt

Accounts payable

Regulatory liabilities

Other

Total current liabilities

Long-Term Debt

Long-term debt

Junior subordinated notes

Remarketable subordinated notes

Credit facility borrowings

Total Long-term debt

Deferred Credits and Other Liabilities

Deferred income taxes and investment tax credits

Regulatory liabilities

Other

Total deferred credits and other liabilities

Total liabilities

Commitments and Contingencies

Equity

Common stock - no par

Retained earnings

Accumulated other comprehensive loss

Total common shareholders’ equity

Noncontrolling interests

Total equity

Total liabilities and equity

(millions)

ASSETS

Current Assets

Cash and cash equivalents

Customer receivables

Other receivables

Inventories

Regulatory assets

Assets held for sale

Other

Total current assets

Investments

Nuclear decommissioning trust funds

Investment in equity method affiliates

Other

Total investments

Property, Plant and Equipment

Property, plant and equipment

Accumulated depreciation, depletion and amortization

Total property, plant and equipment, net

Deferred Charges and Other Assets

Goodwill

Regulatory assets

Other

Total deferred charges and other assets

Total assets

(millions)

LIABILITIES AND EQUITY

Current Liabilities

Securities due within one year

Short-term debt

Accounts payable

Regulatory liabilities

Other

Total current liabilities

Long-Term Debt

Long-term debt

Junior subordinated notes

Remarketable subordinated notes

Credit facility borrowings

Total Long-term debt

Deferred Credits and Other Liabilities

Deferred income taxes and investment tax credits

Regulatory liabilities

Other

Total deferred credits and other liabilities

Total liabilities

Commitments and Contingencies

Equity

Common stock - no par

Retained earnings

Accumulated other comprehensive loss

Total common shareholders’ equity

Noncontrolling interests

Total equity

Total liabilities and equity

(millions, except per share amounts)

Operating Revenue

Operating Expenses

Electric fuel and other energy-related purchases

Purchased electric capacity

Purchased gas

Other operations and maintenance

Impairment loss

Depreciation, depletion and amortization

Other taxes

Total operating expenses

Income from operations

Other income

Interest and related charges

Income from operations including noncontrolling interests before income tax expense

Income tax expense

Net Income Including Noncontrolling Interests

Noncontrolling Interests

Net Income Attributable to Dominion Energy

Average shares of common stock outstanding - basic

Average shares of common stock outstanding - diluted

Earnings Per Common Share - Basic

Earnings Per Common Share - Diluted

(millions, except per share amounts)

Operating Revenue

Operating Expenses

Electric fuel and other energy-related purchases

Purchased electric capacity

Purchased gas

Other operations and maintenance

Impairment loss

Depreciation, depletion and amortization

Other taxes

Total operating expenses

Income from operations

Other income

Interest and related charges

Income (loss) from operations including noncontrolling interests before income tax expense (benefit)

Income tax expense (benefit)

Net Income (Loss) Including Noncontrolling Interests

Noncontrolling Interests

Net Income (Loss) Attributable to Dominion Energy

Average shares of common stock outstanding - basic

Average shares of common stock outstanding - diluted

Earnings (Loss) Per Common Share - Basic

Earnings (Loss) Per Common Share - Diluted

the audited financial statements of Dominion Energy for the year ended December 31, 2017;

the unaudited interim financial statements of Dominion Energy for the nine months ended September 30, 2018;

the audited financial statements of SCANA for the year ended December 31, 2017; and

the unaudited interim financial statements of SCANA for the nine months ended September 30, 2018.

SCANA shares outstanding at September 30, 2018

Exchange ratio (per SCANA share)

Estimated total shares of Dominion Energy common stock to be issued

Closing price of Dominion Energy common stock on November 2, 2018

Estimated equity portion of purchase price

Estimated equity compensation

Total estimated purchase price

(millions)

Total current assets

Investments

Property, plant and equipment

Goodwill

Regulatory assets

Other deferred charges and other assets, including intangible assets

Total assets

Total current liabilities

Long-term debt

Deferred tax liabilities

Regulatory liabilities

Other deferred credits and other liabilities

Total liabilities

Total estimated purchase price

Reflects the issuance of 95.6 million shares of Dominion Energy common stock to SCANA shareholders as consideration for the acquisition. The number of shares of Dominion Energy common stock was calculated based on 142.9 million shares of SCANA common stock outstanding at September 30, 2018 multiplied by the 0.6690 exchange ratio per the merger agreement. Based on the closing price of Dominion Energy’s common stock at November 2, 2018 of $69.89, such consideration is calculated to have a value of $6.7 billion, as shown in Note 3 above.

Reflects the accrual of $76 million in estimated transaction costs associated with the acquisition of SCANA by Dominion Energy, including audit, legal and advisory fees.

Reflects an up-front, one-time rate credit totaling $1.3 billion to all current retail electric service customers of South Carolina Electric & Gas Company (SCE&G) to be paid within 90 days of the closing of the merger, as proposed to the SCPSC, through the reclassification of $1.1 billion of an existing regulatory liability from noncurrent to current and the accrual of an additional $202 million to current regulatory liabilities. The impact of this up-front, one-time rate credit has not been reflected in the unaudited pro forma consolidated statements of income as the $202 million charge is nonrecurring.

Reflects the reclassification of $55 million to current regulatory liabilities of a previously existing $1.1 billion regulatory liability, to be credited over an accelerated twenty-year period following the merger.

Reflects the accrual of a $575 million refund of amounts previously collected from retail electric customers of SCE&G to be credited over an estimated eight-year period following the merger. The allocation between current and noncurrent regulatory liabilities has been determined based on the expected portion to be credited to customer bills. The impact of this refund has not been reflected in the unaudited pro forma consolidated statements of income as the $575 million charge is nonrecurring.

Reflects the accrual of an $880 million refund of amounts previously collected from retail electric customers of SCE&G to be credited over an estimated ten-year period following the merger. The allocation between current and noncurrent regulatory liabilities has been determined based on the expected portion to be credited to customer bills. The impact of this refund has not been reflected in the unaudited pro forma consolidated statements of income as the $880 million charge is nonrecurring.

Reflects the write-down of $813 million of existing regulatory assets and $86 million of existing property, plant and equipment associated with the New Nuclear Development Project under which SCANA and the South Carolina Public Service Authority undertook to construct two Westinghouse AP1000 Advanced Passive Safety nuclear units in Jenkinsville, South Carolina (New Nuclear Development Project) which SCE&G will not seek recovery of following the merger. The impact of this write-down has not been reflected in the unaudited pro forma consolidated statements of income as the $899 million charge is nonrecurring.

Reflects the write-down of $1.4 billion of existing regulatory assets and $86 million of existing property, plant and equipment associated with the New Nuclear Development Project which SCE&G will not seek recovery of following the merger. The impact of this write-down has not been reflected in the unaudited pro forma consolidated statements of income as the $1.5 billion charge is nonrecurring.

Reflects the presentation of nonregulated property, plant and equipment at estimated fair value and the removal of historical accumulated depreciation. For the purposes of the preliminary purchase price allocation in Note 3, the estimated fair value is equal to the carrying value.

Reflects the excess of Dominion Energy’s consideration paid of approximately $1.5 billion over the amount of identifiable assets and liabilities assumed in the transaction (goodwill) as shown in Note 3 above. In addition, this reflects the removal of SCANA’s previously recorded goodwill.

Reflects the estimated settlement of all outstanding SCANA equity compensation awards at the time of the merger, calculated based on an estimated share price of $46.76, which is 0.6690 of the share price of Dominion Energy’s common stock at closing on November 2, 2018 of $69.89, and allocated between compensation considered to be service provided prior to the merger ($20 million) and expense to be recognized after the merger ($14 million). The impact of this charge has not been reflected in the unaudited pro forma consolidated statements of income as it is nonrecurring.

Reflects an intangible asset for the value of customer relationships estimated to be $144 million with a weighted average useful life of approximately three years included within the preliminary purchase price allocation in Note 3. Amortization is based on the expected pattern of economic benefit, estimated to be $46 million, $31 million, $21 million, $14 million and $10 million over the five-year period following the acquisition. Estimated amortization of this asset is $24 million for the nine months ended September 30, 2018 and $46 million for the year ended December 31, 2017.

Reflects a contract liability for the unfavorable terms of an existing contract estimated to be $75 million with a 14-month useful life included within the preliminary purchase price allocation in Note 3. Estimated amortization of this liability is $11 million for the nine months ended September 30, 2018 and $64 million for the year ended December 31, 2017.

Reflects an increase in liabilities for incremental charitable contributions committed to by Dominion Energy under the terms of the merger agreement and a stipulation agreement filed with the NCUC in October 2018 of $21 million, $5 million of which is considered a current liability. The impact of this charge has not been reflected in the unaudited pro forma consolidated statements of income as it is nonrecurring.

Reflects the fair value adjustment of long-term debt of $43 million, on a weighted average maturity of approximately three years, and the write-off of $5 million of unamortized debt issuance costs included within the preliminary purchase price allocation in Note 3. Estimated amortization of the fair value premium, and the elimination of the recorded debt issuance cost amortization, is $15 million and $1 million for the nine months ended September 30, 2018, and $21 million and $1 million for the year ended December 31, 2017, respectively.

Reflects the elimination of SCANA’s historical shareholders’ equity.

This pro forma adjustment conforms SCANA’s accounting for asset retirement obligations, which we refer to as AROs, to the methodology used by Dominion Energy. The cash flows used to measure Dominion Energy’s pipeline AROs reflect the cost and timing of activities legally required to retire component sections of pipeline as they are removed from service. The cash flows previously used to measure SCANA’s pipeline AROs are those legally required to retire the entire pipeline system at one point in time. As a result of this change in accounting estimate, Dominion Energy recorded an increase of $188 million to property, plant and equipment and increases of $6 million and $182 million to current and noncurrent other liabilities, respectively.

Reflects adjustments related to the preliminary purchase price allocation ($5 million) and related pro forma adjustment impacting retained earnings ($448 million), based on an estimated statutory tax rate of 25.0%.

Reflects adjustments related to the preliminary purchase price allocation ($5 million) and related pro forma adjustment impacting retained earnings ($612 million), based on an estimated statutory tax rate of 25.0%.

Reflects income taxes on pro forma adjustments based on an estimated statutory tax rate of 25.0% for the unaudited pro forma consolidated statement of income for the nine months ended September 30, 2018 and an estimated statutory tax rate of 38.3% for the unaudited pro forma consolidated statement of income for the year ended December 31, 2017.

Reflects the elimination of SCANA’s historical accumulated other comprehensive loss.

Reflects the elimination of transactions between Dominion Energy and SCANA, primarily for the purchase and sale of natural gas transportation, included in each company’s historical financial statements. In connection with these transactions, amounts for deposits held by Dominion Energy from SCANA have been eliminated and restrictions on the related cash have been removed.

This pro forma adjustment conforms SCANA’s accounting for certain net periodic pension and other postretirement benefit costs to the methodology used by Dominion Energy. The January 2018 retrospective adoption by Dominion Energy of revised accounting guidance for certain net periodic pension and other postretirement benefit costs requires that the service cost component of net periodic pension and other postretirement benefit costs be classified in the same line item as other compensation costs arising from services rendered by employees, while all other components of net periodic pension and other postretirement benefit costs are classified outside of income from operations. As a result, Dominion Energy recorded corresponding decreases to other operations and maintenance expense and other income in the consolidated statement of income for the year ended December 31, 2017. These adjustments are incorporated in the Dominion Energy financial information included in the unaudited pro forma consolidated statement of income for the year ended December 31, 2017. While SCANA has also adopted the revised accounting guidance (effective January 2018), it has not yet reflected adjustments in its statement of income for the year ended December 31, 2017.

Reflects the elimination of the SCANA common stock offset by the issuance of 95.6 million shares of Dominion Energy common stock as discussed in tickmark (a).

Reflects the impacts of a stipulation agreement filed by Dominion Energy with the NCUC in October 2018 under which the Public Service Company of North Carolina, Incorporated, a wholly-owned subsidiary of SCANA, will record a regulatory liability of $4 million representing a refund to customers of 2017 revenues to be refunded to customers through an annual bill credit over a three-year period following the merger. The impact of this refund has not been reflected in the unaudited pro forma consolidated statements of income as the $4 million charge is nonrecurring.

Reflects direct, incremental costs associated with Dominion Energy’s acquisition of SCANA during the nine months ended September 30, 2018, which are reflected in the unaudited pro forma consolidated statement of income for the associated period, as these charges are nonrecurring.