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| 8-K - FORM 8-K - TEXAS NEW MEXICO POWER CO | a20111103earningsrelease8-k.htm |
For Immediate Release
Nov. 3, 2011
PNM Resources Reports Third Quarter Results
Company raises lower end of 2011 ongoing earnings guidance range
Conference call scheduled for 11 a.m. Eastern today
THIRD QUARTER SUMMARY
• | GAAP (generally accepted accounting principles) earnings of $0.48 per diluted share, compared with $0.53 per diluted share in 2010 |
• | Ongoing earnings of $0.61 per diluted share, compared with $0.63 per diluted share in 2010 |
YEAR-TO-DATE SUMMARY
• | GAAP earnings of $0.70 per diluted share, compared with $0.69 per diluted share in 2010 |
• | Ongoing earnings of $0.85 per diluted share, compared with $0.90 per diluted share in 2010 |
(ALBUQUERQUE, N.M.) - PNM Resources (NYSE: PNM) today reported unaudited 2011 third quarter consolidated GAAP earnings of $43.7 million, or $0.48 per diluted share, compared with earnings of $48.6 million, or $0.53 per diluted share, in 2010.
Quarterly unaudited, consolidated ongoing earnings were $56.0 million, or $0.61 per diluted share, compared with $57.9 million, or $0.63 per diluted share, in 2010. Ongoing earnings exclude various special items, but include the post-impairment results of Optim Energy through Aug. 31, 2011. Reconciliations of GAAP to non-GAAP measures such as ongoing earnings and EBITDA (earnings before interest charges, income taxes, depreciation and amortization) are shown on the attached schedules 1 through 8.
“Our utilities are making significant progress in meeting their financial goals and narrowing the gap of earning their allowed returns,” said Pat Vincent-Collawn, PNM Resources president and CEO. “Specifically, TNMP remains on track to achieve its allowed return in 2011. For PNM, initiatives are underway to reduce costs, putting PNM on a path to achieve its allowed return on retail rate base by the end 2012. With our efforts to further streamline our operations, our utilities are on clear paths to produce solid financial performance in the years to come.”
Quarterly financial materials are available at http://www.pnmresources.com/investors/results.cfm.
YEAR-TO-DATE RESULTS
For the first nine months of 2011, PNM Resources reported unaudited consolidated GAAP earnings of $64.4 million, or $0.70 per diluted share, compared with $63.0 million, or $0.69 per diluted share, in 2010. Unaudited, consolidated ongoing earnings for the first nine months of 2011 were $78.0 million, or $0.85 per diluted share, compared with $82.6 million, or $0.90 per diluted share, in 2010.
(MORE)
PNM Resources Reports Q3 Earnings 11-3-11 p. 2 of 4
SEGMENT REPORTING OF 2011 THIRD QUARTER EARNINGS
Regulated Businesses
PNM - a vertically integrated electric utility in New Mexico with distribution, transmission and generation assets.
• | PNM reported quarterly ongoing earnings of $41.7 million, or $0.45 per diluted share, compared with earnings of $38.9 million, or $0.42 per diluted share, in 2010. GAAP earnings were $38.3 million, or $0.42 per diluted share, compared with earnings of $39.1 million, or $0.43 per diluted share, during the same period in 2010. |
• | The implementation of higher retail rates, which went into effect on Aug. 21, 2011, warmer weather and lower planned and unplanned outage costs more than offset the expiration of the wholesale tolling agreement from Palo Verde Nuclear Generating Station Unit 3. PNM's quarterly load growth was 0.3 percent. |
TNMP - an electric transmission and distribution utility in Texas.
• | TNMP reported ongoing earnings of $9.0 million and GAAP earnings of $8.9 million, or $0.10 per diluted share, compared with 2010 quarterly ongoing and GAAP earnings of $7.3 million, or $0.08 per diluted share. |
• | Higher retail rates that went into effect Feb. 1, 2011, combined with the effects of warmer weather, improved earnings. TNMP had load growth of 0.3 percent during the quarter. |
Competitive Businesses
First Choice Power - On Nov. 1, 2011, PNM Resources completed its sale of First Choice Power to Direct Energy. First Choice Power's third quarter performance is included in PNM Resources' financial results. Results after Oct. 31, 2011, will not be included in PNM Resource's earnings.
• | First Choice Power reported ongoing earnings of $3.1 million, or $0.03 per diluted share, compared with $12.8 million, or $0.14 per diluted share, in 2010. GAAP earnings were $0.6 million, or $0.01 per diluted share, compared with $3.6 million, or $0.03 per diluted share, during the same period last year. |
• | Significantly higher power-purchase costs and lower customer prices more than offset a 21 percent increase in sales volumes driven by warmer weather, higher per-customer usage and customer growth. |
Optim Energy - As previously reported, PNM Resources executed an agreement with the co-owner of Optim Energy in which PNM Resources' interest in Optim Energy was diluted to 1 percent. As a result, Optim Energy's financial results after Aug. 31, 2011, are not included in PNM Resources' earnings.
• | PNM Resources' share of Optim Energy net ongoing earnings in July and August was $4.9 million, or $0.05 per diluted share, compared with $1.8 million, or $0.02 per diluted share, for the full third quarter of 2010. |
• | PNM Resources' share of Optim Energy's ongoing EBITDA in July and August was $14.9 million, compared with $12.7 million for the full third quarter of 2010. |
NOTE: As previously reported, PNM Resources fully impaired its investment in Optim Energy at Dec. 31, 2010, and reduced the carrying value of that investment to zero. In accordance with GAAP, the post-impairment losses of Optim Energy are not reflected in PNM Resources' 2011 GAAP earnings. In the third quarter of 2010, PNM Resources' share of Optim Energy net GAAP earnings was $1.5 million, or $0.02 per diluted share.
(MORE)
PNM Resources Reports Q3 Earnings 11-3-11 p. 3 of 4
Corporate/Other - a segment that reflects costs at the PNM Resources holding company, mainly comprised of interest expense related to debt. For the purposes of this news release, the Corporate/Other segment excludes the results of Optim Energy reported above.
• | Corporate/Other reported ongoing losses of $2.7 million, or $0.02 per diluted share, and GAAP losses of $4.1 million, or $0.05 per diluted share, compared with 2010 ongoing and GAAP losses of $3.0 million, or $0.03 per diluted share. |
2011 ONGOING EARNINGS GUIDANCE RANGE TIGHTENED
PNM Resources today updated its 2011 consolidated ongoing earnings to be in the range of $1.00 and $1.05 per diluted share. The previous range was $0.98 to $1.05 per diluted share. As a result of rate relief, warmer weather and strong cost-control efforts, management expects PNM and TNMP to earn a combined $0.18 to $0.23 diluted earnings per share in the fourth quarter.
The company plans to announce 2012 ongoing earnings guidance in early December.
THIRD QUARTER EARNINGS CALL: 11 AM EASTERN TODAY
PNM Resources will discuss third quarter earnings results, financial forecasts and other relevant company matters during a live conference call and Web cast today at 11 a.m. Eastern. Speaking on the call will be Pat Vincent-Collawn, PNM Resources president and CEO, and Chuck Eldred, PNM Resources executive vice president and CFO.
A live Web cast of the call will be archived at http://www.pnmresources.com/investors/events.cfm. Listeners are encouraged to visit the Web site at least 30 minutes before the event to register, download and install any necessary audio software.
Investors and analysts can participate in the live conference call by dialing (877) 377-7098 or (631) 291-4547 (international calls) and referencing “the PNM Resources third quarter earnings conference call.” A telephone replay will be available at 2 p.m. Eastern until midnight Nov. 17 by dialing (855) 859-2056 or (404) 537-3406 and using conference ID 18233321. Supporting material for PNM Resources' earnings announcements can be viewed and downloaded at http://www.pnmresources.com/investors/results.cfm.
Background:
PNM Resources (NYSE: PNM) is an energy holding company based in Albuquerque, N.M., with 2010 consolidated operating revenues of $1.7 billion. Through its regulated utilities, PNM Resources has approximately 2,530 megawatts of generation capacity and serves electricity to more than 700,000 homes and businesses in New Mexico and Texas. For more information, visit the company's Web site at www.PNMResources.com.
(MORE)
PNM Resources Reports Q3 Earnings 11-3-11 p. 4 of 4
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Statements made in this news release that relate to future events or PNM Resources', Public Service Company of New Mexico's (“PNM”), or Texas-New Mexico Power Company's (“TNMP”) (collectively, the “Company”) expectations, projections, estimates, intentions, goals, targets, and strategies, are made pursuant to the Private Securities Litigation Reform Act of 1995. Readers are cautioned that all forward-looking statements are based upon current expectations and estimates and PNM Resources, PNM, and TNMP assume no obligation to update this information. Because actual results may differ materially from those expressed or implied by these forward-looking statements, PNM Resources, PNM, and TNMP caution readers not to place undue reliance on these statements. PNM Resources', PNM's, and TNMP's business, financial condition, cash flow, and operating results are influenced by many factors, which are often beyond their control, that can cause actual results to differ from those expressed or implied by the forward-looking statements. These factors include: The ability of PNM and TNMP to recover their costs and earn their allowed returns in their regulated jurisdictions; the ability of the Company to successfully forecast and manage its operating and capital expenditures, particularly in the context of a future test year rate case with respect to PNM; the performance of state, regional, and national economies and the resulting impacts on the electricity usage of the Company's customers; the performance of generating units, including the Palo Verde Nuclear Generating Station (“PVNGS”), the San Juan Generating Station (“SJGS”), and the Four Corners Plant, transmission systems, and distribution systems, which could be negatively affected by major equipment failures, major weather disruptions, disruptions in fuel supply, cyber and physical security breaches, and other significant operational issues; state and federal regulation or legislation relating to climate change, reduction of greenhouse gas emissions, coal combustion byproducts , nitrogen oxides, and other power plant emissions, including the risk that the Company may have to commit to substantial capital investments and additional operating costs to comply with new environmental requirements, including possible future requirements to address regional haze regulations and related best available retrofit technology requirements and concerns about global climate change, and the resultant impacts on the operations and economic viability of generating plants in which PNM has interests; uncertainties surrounding the mine fire incident at the mine supplying coal to SJGS, including potential impacts on the operations of SJGS, the costs of fuel, and the cap on the annual amounts recoverable through PNM's fuel and purchase power adjustment clause (“FPPAC”); state and federal regulatory, legislative, and judicial decisions and actions, including the outcomes of PNM's pending transmission and firm requirements power rate cases and appeals of prior regulatory proceedings; state and federal regulatory, legislative, and judicial decisions and actions, including the outcomes of PNM's pending transmission and firm requirements power rate cases and appeals of prior regulatory proceedings; uncertainty surrounding the status of PNM's participation in jointly-owned generation projects resulting from the scheduled expiration of the operational documents for the projects beginning in 2016 and potential changes in the objectives of the participants in the projects; uncertainty regarding the requirements and related costs of decommissioning power plants owned or partially owned by PNM and coal mines supplying certain PNM power plants, as well as the ability to recover decommissioning costs from customers; financial and operational risks at PVNGS relating to any increased regulatory review and actions in response to the events at the Fukushima Daiichi Nuclear Power Plant in Japan; the risk that recently enacted reliability standards regarding available transmission capacity may reduce certain PNM transmission rights used to transmit its generation resources and provide access to transmission customers resulting in a need to purchase additional transmission capacity, reduce sales of transmission capacity, or operate generation facilities less economically; the risks associated with completion of generation, transmission, distribution, and other projects, including construction delays and unanticipated cost overruns; the ability of PNM to successfully defend the utilization of a future test year in its electric rate filings with the New Mexico Public Regulation Commission (“NMPRC”), including PNM's ability to withstand challenges by regulators and intervenors; the ability of PNM to meet the renewable energy requirements established by the NMPRC, including the resource diversity requirement, within the specified cost parameters; the risk that replacement power costs incurred by PNM related to not meeting the specified capacity factor for its generating units under its Emergency FPPAC will not be approved by the NMPRC; the risk that PNM may not be able to recover a portion of the increased costs of rights-of-way renewals on Native American lands through rates charged to transmission customers; conditions affecting the Company's ability to access the financial markets, including disruptions in the credit markets and actions by ratings agencies affecting the Company's credit ratings; the potential unavailability of cash from PNM Resources' subsidiaries due to regulatory, statutory, or contractual restrictions; the impacts of decreases in the values of marketable equity securities on the trust funds maintained to provide nuclear decommissioning funding and pension and other postretirement benefits, including the levels of funding and expense; the impacts of the true-up of the purchase price for the sale of First Choice Power to the actual amounts of certain components of working capital at closing; uncertainties surrounding the successful completion of PNM Resources' tender offer to repurchase up to $50.0 million of its outstanding 9.25% senior unsecured notes, due in 2015; changes in the Electric Reliability Council Of Texas protocols; collections experience; fluctuations in interest rates; weather; water supply; changes in fuel costs; availability of fuel supplies; the effectiveness of risk management and commodity risk transactions; seasonality and other changes in supply and demand in the market for electric power; the impact of mandatory energy efficiency measures on customer energy usage; variability of wholesale power prices and natural gas prices; volatility and liquidity in the wholesale power markets and the natural gas markets; uncertainty regarding the ongoing validity of government programs for emission allowances; changes in the competitive environment in the electric industry; the outcome of legal proceedings; the extent of insurance coverage available for claims made in litigation; and changes in applicable accounting principles.
Non-GAAP Financial Measures
The Company uses ongoing earnings and ongoing earnings per diluted share (or ongoing diluted earnings per share) and EBITDA (earnings before interest charges, income taxes, depreciation and amortization) and ongoing EBITDA to evaluate the operations of the Company and to establish goals for management and employees. While the Company believes these financial measures are appropriate and useful for investors, they are not measures presented in accordance with generally accepted accounting principles in the U.S. (GAAP). The Company does not intend for these measures, or any piece of these measures, to represent any financial measure as defined by GAAP. Furthermore, the Company's calculations of these measures as presented may or may not be comparable to similarly titled measures used by other companies. The Company uses ongoing earnings guidance to provide investors with management's expectations of ongoing financial performance over the period presented. While the Company believes ongoing earnings guidance is an appropriate measure, it is not a measure presented in accordance with GAAP. The Company does not intend for ongoing earnings guidance to represent an expectation of net earnings as defined by GAAP. Management is generally not able to estimate the impact of the reconciling items between ongoing earnings guidance and forecasted GAAP earnings, nor their probable impact on GAAP earnings; therefore, management is generally not able to provide a corresponding GAAP equivalent for earnings guidance. In addition, The Company uses forecasts of ongoing EBITDA and cash earnings guidance to provide investors with management's expectations of additional indicators of ongoing financial performance. Since forecasts of EBITDA and cash earnings are derived from forecasted ongoing earnings, management is not able reconcile these items to a GAAP equivalent.
CONTACTS:
Analysts Analysts & Media
Lisa Eden Frederick Bermudez
(505) 241-2691 (505) 241-4831
(MORE)
PNM Resources
Schedule 1
Reconciliation of Ongoing to GAAP Earnings
(Preliminary and Unaudited)
Quarter Ended September 30, 2011 | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Optim Energy (50%)** | Corporate and Other | Consolidated | |||||||||||||||||||
GAAP Net Earnings (Loss) Attributable to PNMR: | $ | 38,329 | $ | 8,868 | $ | 613 | $ | — | $ | (4,148 | ) | $ | 43,662 | |||||||||||
Adjusting items, net of income tax effects* | ||||||||||||||||||||||||
Mark-to-market impact of economic hedges | (1,612 | ) | — | 2,443 | (283 | ) | — | 548 | ||||||||||||||||
Net change in unrealized impairments of NDT securities | 3,058 | — | — | — | — | 3,058 | ||||||||||||||||||
Process improvement initiatives | 463 | 159 | 29 | — | — | 651 | ||||||||||||||||||
Strategic alternatives - competitive business | — | — | — | — | 1,461 | 1,461 | ||||||||||||||||||
New Mexico gross receipts tax adjustments | 1,471 | — | — | — | — | 1,471 | ||||||||||||||||||
Equity in net earnings (loss) of Optim Energy | — | — | — | 5,154 | — | 5,154 | ||||||||||||||||||
Total Adjustments | 3,380 | 159 | 2,472 | 4,871 | 1,461 | 12,343 | ||||||||||||||||||
Ongoing Earnings (Loss) | $ | 41,709 | $ | 9,027 | $ | 3,085 | $ | 4,871 | $ | (2,687 | ) | $ | 56,005 | |||||||||||
Nine Months Ended September 30, 2011 | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Optim Energy (50%)** | Corporate and Other | Consolidated | |||||||||||||||||||
GAAP Net Earnings (Loss) Attributable to PNMR: | $ | 40,474 | $ | 17,134 | $ | 20,721 | $ | — | $ | (13,963 | ) | $ | 64,366 | |||||||||||
Adjusting items, net of income tax effects* | ||||||||||||||||||||||||
Mark-to-market impact of economic hedges | (2,488 | ) | — | (1,125 | ) | (1,078 | ) | — | (4,691 | ) | ||||||||||||||
Net change in unrealized impairments of NDT securities | 2,702 | — | — | — | — | 2,702 | ||||||||||||||||||
Process improvement initiatives | 2,227 | 445 | 92 | — | 47 | 2,811 | ||||||||||||||||||
Regulatory Disallowance | 10,559 | 2,550 | — | — | — | 13,109 | ||||||||||||||||||
Strategic alternatives - competitive business | — | — | — | — | 2,367 | 2,367 | ||||||||||||||||||
New Mexico gross receipts tax adjustments | 1,471 | — | — | — | — | 1,471 | ||||||||||||||||||
Equity in net earnings (loss) of Optim Energy | — | — | — | (4,167 | ) | — | (4,167 | ) | ||||||||||||||||
Total Adjustments | 14,471 | 2,995 | (1,033 | ) | (5,245 | ) | 2,414 | 13,602 | ||||||||||||||||
Ongoing Earnings (Loss) | $ | 54,945 | $ | 20,129 | $ | 19,688 | $ | (5,245 | ) | $ | (11,549 | ) | $ | 77,968 | ||||||||||
* Income tax effects calculated using tax rates of 35.65% for First Choice, 35.00% for TNMP and 39.59% for all other segments. | ||||||||||||||||||||||||
** Optim Energy included through August 31, 2011. | ||||||||||||||||||||||||
PNM Resources
Schedule 2
Reconciliation of Ongoing to GAAP Earnings
(Preliminary and Unaudited)
Quarter Ended September 30, 2010 | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Optim Energy (50%) | Corporate and Other | Consolidated | |||||||||||||||||||
GAAP Net Earnings (Loss) Attributable to PNMR: | $ | 39,122 | $ | 7,329 | $ | 3,557 | $ | 1,510 | $ | (2,966 | ) | $ | 48,552 | |||||||||||
Adjusting items, net of income tax effects* | ||||||||||||||||||||||||
Mark-to-market impact of economic hedges | 937 | — | 9,265 | 267 | — | 10,469 | ||||||||||||||||||
Net change in unrealized impairments of NDT securities | (1,126 | ) | — | — | — | — | (1,126 | ) | ||||||||||||||||
Total Adjustments | (189 | ) | — | 9,265 | 267 | — | 9,343 | |||||||||||||||||
Ongoing Earnings (Loss) | $ | 38,933 | $ | 7,329 | $ | 12,822 | $ | 1,777 | $ | (2,966 | ) | $ | 57,895 | |||||||||||
Nine Months Ended September 30, 2010 | ||||||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Optim Energy (50%) | Corporate and Other | Consolidated | |||||||||||||||||||
GAAP Earnings (Loss) Attributable to PNMR: | $ | 52,207 | $ | 13,079 | $ | 12,657 | $ | (3,452 | ) | $ | (11,510 | ) | $ | 62,981 | ||||||||||
Adjusting items, net of income tax effects* | ||||||||||||||||||||||||
Mark-to-market impact of economic hedges | 4,345 | — | 21,244 | (650 | ) | — | 24,939 | |||||||||||||||||
Net change in unrealized impairments of NDT securities | (429 | ) | — | — | — | — | (429 | ) | ||||||||||||||||
Loss on reacquired debt | 282 | — | — | — | — | 282 | ||||||||||||||||||
Disposition of litigation | (5,141 | ) | — | — | — | — | (5,141 | ) | ||||||||||||||||
Total Adjustments | (943 | ) | — | 21,244 | (650 | ) | — | 19,651 | ||||||||||||||||
Ongoing Earnings (Loss) | $ | 51,264 | $ | 13,079 | $ | 33,901 | $ | (4,102 | ) | $ | (11,510 | ) | $ | 82,632 | ||||||||||
* Income tax effects calculated using tax rates of 35.65% for First Choice and 39.59% for all other segments unless otherwise indicated. | ||||||||||||||||||||||||
PNM Resources
Schedule 3
Reconciliation of Ongoing to GAAP Earnings Per Diluted Share
(Preliminary and Unaudited)
Quarter Ended September 30, 2011 | ||||||||||||||||||||||||
(earnings per diluted share) | ||||||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Optim Energy (50%)* | Corporate and Other | Consolidated | |||||||||||||||||||
GAAP Net Earnings (Loss) Attributable to PNMR: | $ | 0.42 | $ | 0.10 | $ | 0.01 | $ | — | $ | (0.05 | ) | $ | 0.48 | |||||||||||
Adjusting items | ||||||||||||||||||||||||
Mark-to-market impact of economic hedges | (0.02 | ) | — | 0.02 | — | — | — | |||||||||||||||||
Net change in unrealized impairments of NDT securities | 0.03 | — | — | — | — | 0.03 | ||||||||||||||||||
Process improvement initiatives | 0.01 | — | — | — | — | 0.01 | ||||||||||||||||||
Strategic alternatives - competitive businesses | — | — | — | — | 0.03 | 0.03 | ||||||||||||||||||
New Mexico gross receipts tax adjustments | 0.01 | — | — | — | — | 0.01 | ||||||||||||||||||
Equity in net earnings (loss) of Optim Energy | — | — | — | 0.05 | — | 0.05 | ||||||||||||||||||
Total Adjustments | 0.03 | — | 0.02 | 0.05 | 0.03 | 0.13 | ||||||||||||||||||
Ongoing Earnings (Loss) | $ | 0.45 | $ | 0.10 | $ | 0.03 | $ | 0.05 | $ | (0.02 | ) | $ | 0.61 | |||||||||||
Average Diluted Shares Outstanding: | 91,742,267 | |||||||||||||||||||||||
Nine Months Ended September 30, 2011 | ||||||||||||||||||||||||
(earnings per diluted share) | ||||||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Optim Energy (50%)* | Corporate and Other | Consolidated | |||||||||||||||||||
GAAP Net Earnings (Loss) Attributable to PNMR: | $ | 0.44 | $ | 0.19 | $ | 0.22 | $ | — | $ | (0.15 | ) | $ | 0.70 | |||||||||||
Adjusting items | ||||||||||||||||||||||||
Mark-to-market impact of economic hedges | (0.03 | ) | — | (0.01 | ) | (0.01 | ) | — | (0.05 | ) | ||||||||||||||
Net change in unrealized impairments of NDT securities | 0.03 | — | — | — | — | 0.03 | ||||||||||||||||||
Process improvement initiatives | 0.03 | — | — | — | — | 0.03 | ||||||||||||||||||
Regulatory Disallowance | 0.12 | 0.03 | — | — | — | 0.15 | ||||||||||||||||||
Strategic alternatives - competitive businesses | — | — | — | — | 0.03 | 0.03 | ||||||||||||||||||
New Mexico gross receipts tax adjustments | 0.01 | — | — | — | — | 0.01 | ||||||||||||||||||
Equity in net earnings (loss) of Optim Energy | — | — | — | (0.05 | ) | — | (0.05 | ) | ||||||||||||||||
Total Adjustments | 0.16 | 0.03 | (0.01 | ) | (0.06 | ) | 0.03 | 0.15 | ||||||||||||||||
Ongoing Earnings (Loss) | $ | 0.60 | $ | 0.22 | $ | 0.21 | $ | (0.06 | ) | $ | (0.12 | ) | $ | 0.85 | ||||||||||
Average Diluted Shares Outstanding: | 91,980,853 | |||||||||||||||||||||||
* Optim Energy included through August 31, 2011. | ||||||||||||||||||||||||
PNM Resources
Schedule 4
Reconciliation of Ongoing to GAAP Earnings Per Diluted Share
(Preliminary and Unaudited)
Quarter Ended September 30, 2010 | ||||||||||||||||||||||||
(earnings per diluted share) | ||||||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Optim Energy (50%) | Corporate and Other | Consolidated | |||||||||||||||||||
GAAP Net Earnings (Loss) Attributable to PNMR: | $ | 0.43 | $ | 0.08 | $ | 0.03 | $ | 0.02 | $ | (0.03 | ) | $ | 0.53 | |||||||||||
Adjusting items | ||||||||||||||||||||||||
Mark-to-market impact of economic hedges | — | — | 0.11 | — | — | 0.11 | ||||||||||||||||||
Net change in unrealized impairments of NDT securities | (0.01 | ) | — | — | — | — | (0.01 | ) | ||||||||||||||||
Total Adjustments | (0.01 | ) | — | 0.11 | — | — | 0.10 | |||||||||||||||||
Ongoing Earnings (Loss) | $ | 0.42 | $ | 0.08 | $ | 0.14 | $ | 0.02 | $ | (0.03 | ) | $ | 0.63 | |||||||||||
Average Diluted Shares Outstanding: | 91,780,931 | |||||||||||||||||||||||
Nine Months Ended September 30, 2010 | ||||||||||||||||||||||||
(earnings per diluted share) | ||||||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Optim Energy (50%) | Corporate and Other | Consolidated | |||||||||||||||||||
GAAP Earnings (Loss) Attributable to PNMR: | $ | 0.57 | $ | 0.14 | $ | 0.14 | $ | (0.04 | ) | $ | (0.12 | ) | $ | 0.69 | ||||||||||
Adjusting items | ||||||||||||||||||||||||
Mark-to-market impact of economic hedges | 0.05 | — | 0.23 | (0.01 | ) | — | 0.27 | |||||||||||||||||
Net change in unrealized impairments of NDT securities | — | — | — | — | — | — | ||||||||||||||||||
Disposition of litigation | (0.06 | ) | — | — | — | — | (0.06 | ) | ||||||||||||||||
Total Adjustments | (0.01 | ) | — | 0.23 | (0.01 | ) | — | 0.21 | ||||||||||||||||
Ongoing Earnings (Loss) | $ | 0.56 | $ | 0.14 | $ | 0.37 | $ | (0.05 | ) | $ | (0.12 | ) | $ | 0.90 | ||||||||||
Average Diluted Shares Outstanding: | 91,813,845 | |||||||||||||||||||||||
PNM Resources
Schedule 5
Segment Reconciliation of GAAP Net Earnings to Ongoing EBITDA
(Earnings Before Interest Charges, Income Taxes, Depreciation and Amortization)
(Preliminary and Unaudited)
(in millions)
Quarter Ended September 30, 2011 | ||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Corporate and Other* | Consolidated | ||||||||||||||||
GAAP Net Earnings (Loss) Attributable to PNMR | $ | 38.3 | $ | 8.9 | $ | 0.6 | $ | (4.1 | ) | $ | 43.7 | |||||||||
Interest charges | 18.5 | 7.3 | 0.2 | 5.1 | 31.1 | |||||||||||||||
Income taxes | 25.1 | 5.7 | 0.6 | (5.4 | ) | 26.0 | ||||||||||||||
Depreciation and amortization | 25.1 | 12.7 | 0.3 | 4.3 | 42.4 | |||||||||||||||
EBITDA | 107.0 | 34.6 | 1.7 | (0.1 | ) | 143.2 | ||||||||||||||
GAAP to ongoing adjustments (before tax) | 4.9 | 0.2 | 3.9 | 10.4 | 19.4 | |||||||||||||||
Ongoing EBITDA | $ | 111.9 | $ | 34.8 | $ | 5.6 | $ | 10.3 | $ | 162.6 | ||||||||||
Nine Months Ended September 30, 2011 | ||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Corporate and Other* | Consolidated | ||||||||||||||||
GAAP Net Earnings (Loss) Attributable to PNMR | $ | 40.5 | $ | 17.1 | $ | 20.7 | $ | (13.9 | ) | $ | 64.4 | |||||||||
Interest charges | 54.6 | 21.9 | 0.5 | 15.3 | 92.3 | |||||||||||||||
Income taxes | 26.6 | 10.8 | 11.8 | (12.0 | ) | 37.2 | ||||||||||||||
Depreciation and amortization | 71.7 | 33.7 | 1.0 | 12.7 | 119.1 | |||||||||||||||
EBITDA | 193.4 | 83.5 | 34.0 | 2.1 | 313.0 | |||||||||||||||
GAAP to ongoing adjustments (before tax) | 21.8 | 4.6 | (1.5 | ) | (4.8 | ) | 20.1 | |||||||||||||
Ongoing EBITDA | $ | 215.2 | $ | 88.1 | $ | 32.5 | $ | (2.7 | ) | $ | 333.1 | |||||||||
* Corporate & Other segment includes equity in net earnings (loss) of Optim Energy through August 31, 2011. See Schedule 7 for calculation of Optim Energy ongoing EBITDA. | ||||||||||||||||||||
PNM Resources
Schedule 6
Segment Reconciliation of GAAP Net Earnings to Ongoing EBITDA
(Earnings Before Interest Charges, Income Taxes, Depreciation and Amortization)
(Preliminary and Unaudited)
(in millions)
Quarter Ended September 30, 2010 | ||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Corporate and Other* | Consolidated | ||||||||||||||||
GAAP Net Earnings (Loss) Attributable to PNMR | $ | 39.1 | $ | 7.3 | $ | 3.6 | $ | (1.4 | ) | $ | 48.6 | |||||||||
Interest charges | 18.0 | 7.7 | 0.4 | 5.2 | 31.3 | |||||||||||||||
Income taxes | 25.9 | 4.7 | 2.2 | (4.0 | ) | 28.8 | ||||||||||||||
Depreciation and amortization | 23.1 | 11.6 | 0.2 | 4.1 | 39.0 | |||||||||||||||
EBITDA | 106.1 | 31.3 | 6.4 | 3.9 | 147.7 | |||||||||||||||
GAAP to ongoing adjustments (before tax) | (1.0 | ) | — | 14.4 | 0.4 | 13.8 | ||||||||||||||
Ongoing EBITDA | $ | 105.1 | $ | 31.3 | $ | 20.8 | $ | 4.3 | $ | 161.5 | ||||||||||
Nine Months Ended September 30, 2010 | ||||||||||||||||||||
PNM Electric | TNMP Electric | First Choice | Corporate and Other* | Consolidated | ||||||||||||||||
GAAP Net Earnings (Loss) Attributable to PNMR | $ | 52.2 | $ | 13.1 | $ | 12.7 | $ | (15.0 | ) | $ | 63.0 | |||||||||
Interest charges | 54.5 | 23.5 | 1.1 | 15.4 | 94.5 | |||||||||||||||
Income taxes | 34.7 | 8.5 | 7.4 | (13.2 | ) | 37.4 | ||||||||||||||
Depreciation and amortization | 68.9 | 31.7 | 0.7 | 12.3 | 113.6 | |||||||||||||||
EBITDA | 210.3 | 76.8 | 21.9 | (0.5 | ) | 308.5 | ||||||||||||||
GAAP to ongoing adjustments (before tax) | (3.7 | ) | — | 33.0 | (1.1 | ) | 28.2 | |||||||||||||
Ongoing EBITDA | $ | 206.6 | $ | 76.8 | $ | 54.9 | $ | (1.6 | ) | $ | 336.7 | |||||||||
* Corporate & Other segment includes equity in net earnings (loss) of Optim Energy. See Schedule 7 for calculation of Optim Energy ongoing EBITDA. | ||||||||||||||||||||
PNM Resources
Schedule 7
Calculation of Optim Energy Ongoing EBITDA
(Earnings Before Interest Charges, Income Taxes, Depreciation and Amortization)
(Preliminary and Unaudited)
Two Months Ended | Eight Months Ended | |||||||
August 31, 2011 | August 31, 2011 | |||||||
(in millions) | ||||||||
GAAP Net Earnings (Loss) | $ | 17.0 | $ | (13.8 | ) | |||
Interest expense | 2.6 | 10.6 | ||||||
Income tax | 0.5 | 0.6 | ||||||
Depreciation and amortization expense | 7.2 | 31.9 | ||||||
Mark-to-market impact of economic hedges | (0.8 | ) | (3.6 | ) | ||||
Purchase accounting amortizations | 3.3 | 14.9 | ||||||
Ongoing Optim Energy EBITDA | 29.8 | 40.6 | ||||||
50 percent of Ongoing EBITDA (PNMR share) | $ | 14.9 | $ | 20.3 | ||||
Quarter Ended | Nine Months Ended | |||||||
September 30, 2010 | September 30, 2010 | |||||||
(in millions) | ||||||||
GAAP Net Earnings (Loss) | $ | 7.6 | $ | (6.8 | ) | |||
Interest expense | 4.7 | 14.0 | ||||||
Income tax | 0.2 | 0.3 | ||||||
Depreciation and amortization expense | 12.4 | 37.3 | ||||||
Mark-to-market impact of economic hedges | 0.9 | (2.2 | ) | |||||
Purchase accounting amortizations | (0.4 | ) | 10.4 | |||||
Ongoing Optim Energy EBITDA | 25.4 | 53.0 | ||||||
50 percent of Ongoing EBITDA (PNMR share) | $ | 12.7 | $ | 26.5 | ||||
PNM Resources
Schedule 8
Reconciliation of Ongoing (non-GAAP) Net Earnings
to GAAP Consolidated Statement of Earnings (Loss)
(Preliminary and Unaudited)
(in thousands, except per share data)
Nine Months Ended September 30, | ||||||||||||||||||||||||||
2011 | 2010 | |||||||||||||||||||||||||
GAAP | Adjustments | Ongoing | GAAP | Adjustments | Ongoing | |||||||||||||||||||||
(in thousands, except per share data) | ||||||||||||||||||||||||||
Operating revenues | $ | 1,352,747 | $ | (3,775 | ) | (a) | $ | 1,348,972 | $ | 1,292,865 | $ | 3,646 | (a) | $ | 1,296,511 | |||||||||||
Cost of energy | 582,814 | 17,118 | (b) | 599,932 | 557,238 | (22,058 | ) | (h) | 535,180 | |||||||||||||||||
Gross margin | 769,933 | (20,893 | ) | 749,040 | 735,627 | 25,704 | 761,331 | |||||||||||||||||||
Other operating expenses | 457,454 | (34,481 | ) | (c) | 422,973 | 432,430 | (2,076 | ) | (d) | 430,354 | ||||||||||||||||
Depreciation and amortization | 119,115 | (2,125 | ) | (d) | 116,990 | 113,634 | (2,121 | ) | (d) | 111,513 | ||||||||||||||||
Operating income | 193,364 | 15,713 | 209,077 | 189,563 | 29,901 | 219,464 | ||||||||||||||||||||
Equity in net earnings (loss) of Optim Energy | — | (8,682 | ) | (e) | (8,682 | ) | (5,714 | ) | (1,076 | ) | (a) | (6,790 | ) | |||||||||||||
Net other income (deductions) | 11,619 | 4,473 | (f) | 16,092 | 21,686 | (8,753 | ) | (i) | 12,933 | |||||||||||||||||
Interest charges | (92,251 | ) | — | (92,251 | ) | (94,488 | ) | — | (94,488 | ) | ||||||||||||||||
Earnings before Income Taxes | 112,732 | 11,504 | 124,236 | 111,047 | 20,072 | 131,119 | ||||||||||||||||||||
Income Taxes | 37,206 | 8,666 | (g) | 45,872 | 37,365 | 10,726 | (g) | 48,091 | ||||||||||||||||||
Net Earnings | 75,526 | 2,838 | 78,364 | 73,682 | 9,346 | 83,028 | ||||||||||||||||||||
Earnings Attributable to Valencia Non-controlling Interest | (10,764 | ) | 10,764 | (d) | — | (10,305 | ) | 10,305 | (d) | — | ||||||||||||||||
Preferred Stock Dividend Requirements of Subsidiary | (396 | ) | — | (396 | ) | (396 | ) | — | (396 | ) | ||||||||||||||||
Net Earnings Attributable to PNMR | $ | 64,366 | $ | 13,602 | $ | 77,968 | $ | 62,981 | $ | 19,651 | $ | 82,632 | ||||||||||||||
Net Earnings Attributable to PNMR per Common Share: | ||||||||||||||||||||||||||
Basic | $ | 0.70 | $ | 0.15 | $ | 0.85 | $ | 0.69 | $ | 0.21 | $ | 0.90 | ||||||||||||||
Diluted | $ | 0.70 | $ | 0.15 | $ | 0.85 | $ | 0.69 | $ | 0.21 | $ | 0.90 | ||||||||||||||
Average common shares outstanding: | ||||||||||||||||||||||||||
Basic | 91,465 | 91,556 | ||||||||||||||||||||||||
Diluted | 91,981 | 91,814 | ||||||||||||||||||||||||
(a) Mark-to-market impact of economic hedges | ||||||||||||||||||||||||||
(b) Mark-to-market impact of economic hedges $2,094; Consolidation of Valencia $15,024 | ||||||||||||||||||||||||||
(c) Consolidation of Valencia $(2,137); Regulatory disallowances $(21,402); Strategic alternatives - competitive business $(3,918); Process improvement initiatives $(4,590); New Mexico gross receipts tax adjustments $(2,434) | ||||||||||||||||||||||||||
(d) Consolidation of Valencia | ||||||||||||||||||||||||||
(e) Equity in net earnings (loss) of Optim Energy $(6,898); Mark-to-market impact of economic hedges $(1,784) | ||||||||||||||||||||||||||
(f) Net change in unrealized impairments of NDT securities | ||||||||||||||||||||||||||
(g) Net taxes on adjusting items | ||||||||||||||||||||||||||
(h) Mark-to-market impact of economic hedges $(36,560); Consolidation of Valencia $14,502 | ||||||||||||||||||||||||||
(i) Disposition of litigation $(8,509); Net change in unrealized impairment of NDT securities $(710); Loss on reaquired debt $466. | ||||||||||||||||||||||||||
PNM RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Unaudited)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
(In thousands, except per share amounts) | |||||||||||||||
Electric Operating Revenues | $ | 549,498 | $ | 503,653 | $ | 1,352,747 | $ | 1,292,865 | |||||||
Operating Expenses: | |||||||||||||||
Cost of energy | 250,854 | 215,169 | 582,814 | 557,238 | |||||||||||
Administrative and general | 69,755 | 71,193 | 197,016 | 196,398 | |||||||||||
Energy production costs | 39,730 | 42,306 | 135,510 | 148,002 | |||||||||||
Regulatory disallowances | — | — | 21,402 | — | |||||||||||
Depreciation and amortization | 42,370 | 38,980 | 119,115 | 113,634 | |||||||||||
Transmission and distribution costs | 17,925 | 15,012 | 52,962 | 44,574 | |||||||||||
Taxes other than income taxes | 20,580 | 15,585 | 50,564 | 43,456 | |||||||||||
Total operating expenses | 441,214 | 398,245 | 1,159,383 | 1,103,302 | |||||||||||
Operating income | 108,284 | 105,408 | 193,364 | 189,563 | |||||||||||
Other Income and Deductions: | |||||||||||||||
Interest income | 3,748 | 4,499 | 12,010 | 14,608 | |||||||||||
Gains (losses) on investments held by NDT | (4,109 | ) | 2,206 | 7,688 | 2,606 | ||||||||||
Other income | 1,755 | 1,963 | 3,559 | 13,333 | |||||||||||
Equity in net earnings (loss) of Optim Energy | — | 2,495 | — | (5,714 | ) | ||||||||||
Other deductions | (4,685 | ) | (3,848 | ) | (11,638 | ) | (8,861 | ) | |||||||
Net other income (deductions) | (3,291 | ) | 7,315 | 11,619 | 15,972 | ||||||||||
Interest Charges | 31,124 | 31,317 | 92,251 | 94,488 | |||||||||||
Earnings before Income Taxes | 73,869 | 81,406 | 112,732 | 111,047 | |||||||||||
Income Taxes | 25,964 | 28,813 | 37,206 | 37,365 | |||||||||||
Net Earnings | 47,905 | 52,593 | 75,526 | 73,682 | |||||||||||
(Earnings) Attributable to Valencia Non-controlling Interest | (4,111 | ) | (3,909 | ) | (10,764 | ) | (10,305 | ) | |||||||
Preferred Stock Dividend Requirements of Subsidiary | (132 | ) | (132 | ) | (396 | ) | (396 | ) | |||||||
Net Earnings Attributable to PNMR | $ | 43,662 | $ | 48,552 | $ | 64,366 | $ | 62,981 | |||||||
Net Earnings Attributable to PNMR per Common Share: | |||||||||||||||
Basic | $ | 0.48 | $ | 0.53 | $ | 0.70 | $ | 0.69 | |||||||
Diluted | $ | 0.48 | $ | 0.53 | $ | 0.70 | $ | 0.69 | |||||||
Dividends Declared per Common Share | $ | 0.125 | $ | 0.125 | $ | 0.375 | $ | 0.375 | |||||||
PNM RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
September 30, 2011 | December 31, 2010 | ||||||
(In thousands) | |||||||
ASSETS | |||||||
Current Assets: | |||||||
Cash and cash equivalents | $ | 22,298 | $ | 15,404 | |||
Accounts receivable, net of allowance for uncollectible accounts of $1,645 and $11,178 | 107,637 | 97,245 | |||||
Unbilled revenues | 47,793 | 71,453 | |||||
Other receivables | 46,955 | 60,562 | |||||
Materials, supplies, and fuel stock | 53,092 | 52,479 | |||||
Regulatory assets | 28,693 | 36,292 | |||||
Commodity derivative instruments | 3,716 | 15,999 | |||||
Income taxes receivable | 99,506 | 97,450 | |||||
Current portion of accumulated deferred income taxes | 886 | 886 | |||||
Current assets of business unit held for sale | 166,119 | — | |||||
Other current assets | 49,043 | 96,110 | |||||
Total current assets | 625,738 | 543,880 | |||||
Other Property and Investments: | |||||||
Investment in PVNGS lessor notes | 79,390 | 103,871 | |||||
Investments held by NDT | 157,001 | 156,922 | |||||
Other investments | 14,639 | 18,791 | |||||
Non-utility property, net of accumulated depreciation of $125 and $2,307 | 5,139 | 7,333 | |||||
Total other property and investments | 256,169 | 286,917 | |||||
Utility Plant: | |||||||
Plant in service and plant held for future use | 4,998,685 | 4,860,614 | |||||
Less accumulated depreciation and amortization | 1,686,971 | 1,626,693 | |||||
3,311,714 | 3,233,921 | ||||||
Construction work in progress | 159,918 | 137,622 | |||||
Nuclear fuel, net of accumulated amortization of $36,722 and $26,247 | 78,218 | 72,901 | |||||
Net utility plant | 3,549,850 | 3,444,444 | |||||
Deferred Charges and Other Assets: | |||||||
Regulatory assets | 475,937 | 502,467 | |||||
Goodwill | 278,297 | 321,310 | |||||
Other intangible assets, net of accumulated amortization of none and $5,414 | — | 26,425 | |||||
Commodity derivative instruments | 247 | 5,264 | |||||
Non-current assets of business unit held for sale | 101,059 | — | |||||
Other deferred charges | 85,343 | 94,376 | |||||
Total deferred charges and other assets | 940,883 | 949,842 | |||||
$ | 5,372,640 | $ | 5,225,083 | ||||
PNM RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
September 30, 2011 | December 31, 2010 | ||||||
(In thousands, except share information) | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current Liabilities: | |||||||
Short-term debt | $ | 289,000 | $ | 222,000 | |||
Current installments of long-term debt | 2,252 | 2,252 | |||||
Accounts payable | 71,949 | 95,969 | |||||
Accrued interest and taxes | 82,636 | 47,783 | |||||
Regulatory liabilities | 429 | 724 | |||||
Commodity derivative instruments | 1,746 | 31,407 | |||||
Dividends declared | 10,966 | 11,565 | |||||
Liability for purchase of Series A Preferred Stock | 73,475 | — | |||||
Current liabilities of business unit held for sale | 103,915 | — | |||||
Other current liabilities | 76,281 | 108,424 | |||||
Total current liabilities | 712,649 | 520,124 | |||||
Long-term Debt | 1,564,077 | 1,563,595 | |||||
Deferred Credits and Other Liabilities: | |||||||
Accumulated deferred income taxes | 582,485 | 540,106 | |||||
Accumulated deferred investment tax credits | 16,350 | 18,089 | |||||
Regulatory liabilities | 363,087 | 342,465 | |||||
Asset retirement obligations | 77,290 | 76,637 | |||||
Accrued pension liability and postretirement benefit cost | 227,401 | 270,172 | |||||
Commodity derivative instruments | 1,913 | 12,831 | |||||
Non-current liabilities of business unit held for sale | 17,596 | — | |||||
Other deferred credits | 123,054 | 147,616 | |||||
Total deferred credits and other liabilities | 1,409,176 | 1,407,916 | |||||
Total liabilities | 3,685,902 | 3,491,635 | |||||
Commitments and Contingencies (See Note 9) | |||||||
Cumulative Preferred Stock of Subsidiary | |||||||
without mandatory redemption requirements ($100 stated value, 10,000,000 shares authorized: issued and outstanding 115,293 shares) | 11,529 | 11,529 | |||||
Equity: | |||||||
PNMR Convertible Preferred Stock, Series A without mandatory redemption requirements (no stated value, 10,000,000 shares authorized: issued and outstanding none and 477,800 shares) | — | 100,000 | |||||
PNMR common stockholders’ equity: | |||||||
Common stock outstanding (no par value, 120,000,000 shares authorized: issued and outstanding 86,673,174 shares) | 1,318,539 | 1,290,465 | |||||
Accumulated other comprehensive income (loss), net of income taxes | (72,913 | ) | (68,666 | ) | |||
Retained earnings | 345,614 | 314,943 | |||||
Total PNMR common stockholders’ equity | 1,591,240 | 1,536,742 | |||||
Non-controlling interest in Valencia | 83,969 | 85,177 | |||||
Total equity | 1,675,209 | 1,721,919 | |||||
$ | 5,372,640 | $ | 5,225,083 | ||||
PNM RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended September 30, | |||||||
2011 | 2010 | ||||||
(In thousands) | |||||||
Cash Flows From Operating Activities: | |||||||
Net earnings | $ | 75,526 | $ | 73,682 | |||
Adjustments to reconcile net earnings to net cash flows from operating activities: | |||||||
Depreciation and amortization | 151,984 | 138,013 | |||||
PVNGS firm-sales contract revenue | (2,558 | ) | (43,535 | ) | |||
Bad debt expense | 20,120 | 21,023 | |||||
Deferred income tax expense | 43,167 | 23,276 | |||||
Equity in net (earnings) loss of Optim Energy | — | 5,714 | |||||
Net unrealized (gains) losses on derivatives | (5,869 | ) | 41,649 | ||||
Realized (gains) on investments held by NDT | (7,688 | ) | (2,606 | ) | |||
Stock based compensation expense | 4,302 | 2,525 | |||||
Regulatory disallowances | 21,402 | — | |||||
Other, net | 3,549 | 3,820 | |||||
Changes in certain assets and liabilities: | |||||||
Accounts receivable and unbilled revenues | (88,462 | ) | (44,710 | ) | |||
Materials, supplies, and fuel stock | (985 | ) | (2,557 | ) | |||
Other current assets | (2,901 | ) | (54,654 | ) | |||
Other assets | (924 | ) | (4,781 | ) | |||
Accounts payable | 13,781 | (9,380 | ) | ||||
Accrued interest and taxes | 33,049 | 141,478 | |||||
Other current liabilities | (12,919 | ) | (47,201 | ) | |||
Other liabilities | (43,691 | ) | (25,198 | ) | |||
Net cash flows from operating activities | 200,883 | 216,558 | |||||
Cash Flows From Investing Activities: | |||||||
Additions to utility and non-utility plant | (236,275 | ) | (181,340 | ) | |||
Proceeds from sales of investments held by NDT | 121,202 | 57,098 | |||||
Purchases of investments held by NDT | (122,174 | ) | (59,395 | ) | |||
Return of principal on PVNGS lessor notes | 32,274 | 29,851 | |||||
Investments in Optim Energy | — | (17,610 | ) | ||||
Other, net | 145 | 636 | |||||
Net cash flows from investing activities | (204,828 | ) | (170,760 | ) | |||
PNM RESOURCES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended September 30, | |||||||
2011 | 2010 | ||||||
(In thousands) | |||||||
Cash Flows From Financing Activities: | |||||||
Short-term borrowings (repayments), net | 67,000 | (6,000 | ) | ||||
Long-term borrowings | 50,000 | 403,845 | |||||
Repayment of long-term debt | (50,000 | ) | (403,845 | ) | |||
Proceeds from stock option exercise | 2,570 | 1,117 | |||||
Purchases to satisfy awards of common stock | (5,288 | ) | (2,804 | ) | |||
Excess tax (shortfall) from stock-based payment arrangements | — | (264 | ) | ||||
Dividends paid | (34,690 | ) | (34,691 | ) | |||
Equity transactions with Valencia’s owner | (11,972 | ) | (11,149 | ) | |||
Payments received on PVNGS firm-sales contracts | 2,558 | 22,872 | |||||
Proceeds from transmission interconnection agreements | 1,246 | — | |||||
Repayment of transmission interconnection agreements | (4,637 | ) | — | ||||
Debt issuance costs and other | (2,486 | ) | (4,423 | ) | |||
Net cash flows from financing activities | 14,301 | (35,342 | ) | ||||
Change in Cash and Cash Equivalents | 10,356 | 10,456 | |||||
Cash and Cash Equivalents at Beginning of Period | 15,404 | 14,641 | |||||
Cash and Cash Equivalents at End of Period | $ | 25,760 | $ | 25,097 | |||
Supplemental Cash Flow Disclosures: | |||||||
Interest paid, net of capitalized interest | $ | 64,130 | $ | 67,824 | |||
Income taxes paid (refunded), net | $ | (3,744 | ) | $ | (98,792 | ) | |
Supplemental schedule of noncash financing activities: | |||||||
Liability incurred for purchase of Convertible Preferred Stock, Series A | $ | 73,475 | |||||
The following table shows PNM Electric operating revenues by customer class, including intersegment revenues and average number of customers:
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||
(In millions, except customers) | |||||||||||||||||||||||
Residential | $ | 124.8 | $ | 111.7 | $ | 13.1 | $ | 291.4 | $ | 275.3 | $ | 16.1 | |||||||||||
Commercial | 115.7 | 107.8 | 7.9 | 287.8 | 272.4 | 15.4 | |||||||||||||||||
Industrial | 28.0 | 23.7 | 4.3 | 71.3 | 64.7 | 6.6 | |||||||||||||||||
Public authority | 7.4 | 6.8 | 0.6 | 17.8 | 16.2 | 1.6 | |||||||||||||||||
Other retail | 2.7 | 2.4 | 0.3 | 7.3 | 7.4 | (0.1 | ) | ||||||||||||||||
Transmission | 14.3 | 12.2 | 2.1 | 35.3 | 31.0 | 4.3 | |||||||||||||||||
Firm requirements wholesale | 8.1 | 8.3 | (0.2 | ) | 25.1 | 23.4 | 1.7 | ||||||||||||||||
Other sales for resale | 19.8 | 32.5 | (12.7 | ) | 57.4 | 91.7 | (34.3 | ) | |||||||||||||||
Mark-to-market activity | 3.0 | (1.1 | ) | 4.1 | 3.8 | (4.2 | ) | 8.0 | |||||||||||||||
$ | 323.8 | $ | 304.3 | $ | 19.5 | $ | 797.2 | $ | 777.9 | $ | 19.3 | ||||||||||||
Average retail customers (thousands) | 503.8 | 501.8 | 2.0 | 503.7 | 501.4 | 2.3 | |||||||||||||||||
The following table shows PNM Electric GWh sales by customer class:
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||
(Gigawatt hours) | |||||||||||||||||
Residential | 1,006.0 | 967.9 | 38.1 | 2,587.2 | 2,570.6 | 16.6 | |||||||||||
Commercial | 1,130.0 | 1,140.2 | (10.2 | ) | 3,060.2 | 3,045.9 | 14.3 | ||||||||||
Industrial | 429.4 | 371.3 | 58.1 | 1,187.8 | 1,085.1 | 102.7 | |||||||||||
Public authority | 84.1 | 80.5 | 3.6 | 214.1 | 198.3 | 15.8 | |||||||||||
Firm requirements wholesale | 154.6 | 165.7 | (11.1 | ) | 481.0 | 506.0 | (25.0 | ) | |||||||||
Other sales for resale | 580.4 | 546.9 | 33.5 | 1,709.9 | 1,632.3 | 77.6 | |||||||||||
3,384.5 | 3,272.5 | 112.0 | 9,240.2 | 9,038.2 | 202.0 | ||||||||||||
The following table shows TNMP Electric operating revenues by retail tariff consumer class, including intersegment revenues, and average number of consumers:
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||
(In millions, except consumers) | |||||||||||||||||||||||
Residential | $ | 34.5 | $ | 27.8 | $ | 6.7 | $ | 77.8 | $ | 66.8 | $ | 11.0 | |||||||||||
Commercial | 21.7 | 20.2 | 1.5 | 62.0 | 57.4 | 4.6 | |||||||||||||||||
Industrial | 3.3 | 3.0 | 0.3 | 9.5 | 9.0 | 0.5 | |||||||||||||||||
Other | 7.5 | 10.2 | (2.7 | ) | 31.5 | 28.8 | 2.7 | ||||||||||||||||
$ | 67.0 | $ | 61.2 | $ | 5.8 | $ | 180.8 | $ | 162.0 | $ | 18.8 | ||||||||||||
Average consumers (thousands) (1) | 232.2 | 229.9 | 2.3 | 231.3 | 229.2 | 2.1 | |||||||||||||||||
(1) | TNMP provides transmission and distribution services to REPs that provide electric service to consumers in TNMP's service territories. The number of consumers above represents the customers of these REPs. Under TECA, consumers in Texas have the ability to choose First Choice or any other REP to provide energy. The average consumers reported above include 66,273 and 73,873 consumers for the three months ended September 30, 2011 and 2010, and 67,549 and 76,611 for the nine months ended September 30, 2011 and 2010, who have chosen First Choice as their REP. These consumers are also included as customers in the First Choice segment. |
The following table shows TNMP Electric GWh sales by retail tariff consumer class:
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||
(Gigawatt hours(1)) | |||||||||||||||||
Residential | 1,015.0 | 927.6 | 87.4 | 2,319.4 | 2,182.8 | 136.6 | |||||||||||
Commercial | 703.7 | 671.9 | 31.8 | 1,825.7 | 1,736.8 | 88.9 | |||||||||||
Industrial | 675.2 | 580.3 | 94.9 | 1,931.1 | 1,674.2 | 256.9 | |||||||||||
Other | 28.7 | 26.8 | 1.9 | 82.5 | 77.3 | 5.2 | |||||||||||
2,422.6 | 2,206.6 | 216.0 | 6,158.7 | 5,671.1 | 487.6 | ||||||||||||
(1) | The GWh sales reported above include 324.1 and 325.9 GWhs for the three months ended September 30, 2011 and 2010, and 775.3 and 822.3 GWhs for the nine months ended September 30, 2011 and 2010 used by consumers, who have chosen First Choice as their REP. These GWhs are also included below in the First Choice segment. |
The following table shows First Choice operating revenues by customer class, including intersegment revenues, and actual number of customers:
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||||||||
(In millions, except customers) | |||||||||||||||||||||||
Residential | $ | 104.2 | $ | 98.4 | $ | 5.8 | $ | 241.9 | $ | 248.4 | $ | (6.5 | ) | ||||||||||
Commercial | 62.5 | 46.1 | 16.4 | 152.2 | 122.5 | 29.7 | |||||||||||||||||
Other | 4.3 | 5.2 | (0.9 | ) | 11.4 | 13.1 | (1.7 | ) | |||||||||||||||
$ | 171.0 | $ | 149.7 | $ | 21.3 | $ | 405.5 | $ | 384.0 | $ | 21.5 | ||||||||||||
Actual customers (thousands) (1,2) | 223.1 | 215.3 | 7.8 | 223.1 | 215.3 | 7.8 | |||||||||||||||||
(1) | See note above in the TNMP Electric segment discussion about the impact of TECA. |
(2) | Due to the competitive nature of First Choice’s business, actual customer counts are presented in the table above as a more representative business indicator than the average consumers that are shown in the table for TNMP. |
The following table shows First Choice GWh electric sales by customer class:
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
2011 | 2010 | Change | 2011 | 2010 | Change | ||||||||||||
(Gigawatt hours) (1) | |||||||||||||||||
Residential | 812.8 | 732.0 | 80.8 | 1,871.5 | 1,831.3 | 40.2 | |||||||||||
Commercial | 569.5 | 410.8 | 158.7 | 1,397.8 | 1,038.2 | 359.6 | |||||||||||
1,382.3 | 1,142.8 | 239.5 | 3,269.3 | 2,869.5 | 399.8 | ||||||||||||
(1) | See note above in the TNMP Electric segment discussion about the impact of TECA. |