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8-K - FORM 8-K - WESTAR ENERGY INC /KSd251635d8k.htm
EX-99.2 - 2011 THIRD QUARTER EARNINGS PACKAGE - WESTAR ENERGY INC /KSd251635dex992.htm

Exhibit 99.1

 

LOGO    Media contact:
  

Gina Penzig,

director, corporate

communications

  

Phone: 785.575.8089

gina.penzig@WestarEnergy.com

  

 

Investor contact:

  

Bruce Burns,

director, investor relations

  

Phone: 785.575.8227

bruce.burns@WestarEnergy.com

 

 

WESTAR ENERGY ANNOUNCES THIRD QUARTER RESULTS

TOPEKA, Kan., Nov. 3, 2011 — Westar Energy, Inc. (NYSE:WR) today announced earnings of $135 million, or $1.15 per share, for the third quarter 2011 compared with earnings of $115 million, or $1.02 per share, for the third quarter 2010. Earnings for the nine months ended Sep. 30, 2011 were $210 million, or $1.82 per share, compared with $198 million, or $1.77 per share, for the same period in 2010. Earnings for 2011 include the benefits of reversing previously recorded accruals as a result of legal settlements and a gain on the sale of a non-utility investment.

Following is a reconciliation of GAAP to ongoing (non-GAAP) earnings per share:

 

     Three Months Ended September 30,     Nine Months Ended September 30,  
     2011      2010      Change     2011      2010      Change  

Basic earnings per share

   $ 1.15       $ 1.02       $ 0.13      $ 1.82       $ 1.77       $ 0.05   

Less adjustments for:

                

Reversal of accruals related to legal settlements (a)

     0.11         —           0.11        0.08         —           0.08   

Gain on sale of non-utility investment

     0.06         —           0.06        0.06         —           0.06   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Ongoing (non-GAAP) earnings per share

   $ 0.98       $ 1.02       $ (0.04   $ 1.68       $ 1.77       $ (0.09
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

 

(a) Per share amounts adjusted for income tax and legal expenses related to legal settlements

Per share results for both periods in 2011 reflect additional shares outstanding as a result of the company having issued shares to fund capital investments.

The primary drivers for increased net income for the third quarter and nine months ended Sept. 30, 2011 were the benefits of reversing previously recorded accruals and the gain on the

 

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Westar Energy announces third quarter 2011 results    Page 2 of 4

 

sale of a non-utility investment. Ongoing earnings, which exclude the one-time benefits previously mentioned, for third quarter 2011 were essentially unchanged from third quarter 2010. An increase in revenues for the quarter, due primarily to higher prices, was offset by increases in operating expenses and losses on investments in a trust to fund retirement benefits. Ongoing earnings for the nine months ended Sept. 30, 2011 decreased by $4 million compared with the same period in 2010. The decrease reflects various increases in operating expenses that more than offset higher retail revenues due primarily to higher prices. The increase in operating expenses include higher transmission network costs, higher expenses for regulatory compliance at the Wolf Creek generating station, increased maintenance for tree trimming on the electrical distribution system and increased depreciation expense.

Reconciliation of GAAP to ongoing (non-GAAP) net income:

 

     Three Months Ended September 30,     Nine Months Ended September 30,  
     2011      2010      Change     2011      2010      Change  
     (Dollars in Millions)     (Dollars in Millions)  

Net Income attributable to common stock

   $ 134.7       $ 114.5       $ 20.2      $ 209.9       $ 198.0       $ 11.9   

Less adjustments for:

                

Reversal of accruals related to legal settlements (a)

     13.3         —           13.3        8.9         —           8.9   

Gain on sale of non-utility investment

     7.2         —           7.2        7.2         —           7.2   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

Ongoing (non-GAAP) net income

   $ 114.2       $ 114.5       $ (0.3   $ 193.8       $ 198.0       $ (4.2
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

    

 

 

 

 

(a) Adjusted for income taxes and legal expenses related to legal settlement

Earnings Guidance

The company affirmed ongoing earnings guidance for 2011 of $1.75 to $1.90 per share. The company has posted to its website a summary of factors it considers to be principal drivers and adjustments used in arriving at earnings guidance. The summary is located under Supplemental Materials within the Investors section of the company website at www.WestarEnergy.com.

 


Westar Energy announces third quarter 2011 results    Page 3 of 4

 

Conference Call and Additional Company Information

Westar Energy management will host a conference call Friday, Nov. 4 with the investment community at 10:00 a.m. ET (9:00 a.m. CT). Investors, media and the public may listen to the conference call by dialing 866-356-3093, participant code 64274311. A webcast of the live conference call will be available at www.WestarEnergy.com.

Members of the media are invited to listen to the conference call and then contact Gina Penzig with any follow-up questions.

This earnings announcement, a package of detailed third quarter 2011 financial information, the company’s quarterly report on Form 10-Q for the period ended Sept. 30, 2011 and other filings the company has made with the Securities and Exchange Commission are available on the company’s website at www.WestarEnergy.com.

Westar Energy, Inc. (NYSE: WR) is the largest electric utility in Kansas, providing electric service to about 687,000 customers in the state. Westar Energy has about 7,100 megawatts of electric generating resources and operates and coordinates more than 34,000 miles of electric distribution and transmission lines.

For more information about Westar Energy, visit us on the Internet at http://www.WestarEnergy.com.

Forward-looking statements: Certain matters discussed in this news release are “forward-looking statements.” The Private Securities Litigation Reform Act of 1995 has established that these statements qualify for safe harbors from liability. Forward-looking statements may include words like “believe,” “anticipate,” “target,” “expect,” “pro forma,” “estimate,” “intend,” “guidance” or words of similar meaning. Forward-looking statements describe future plans, objectives, expectations or goals. Although Westar Energy believes that its expectations are based on reasonable assumptions, all forward-looking statements involve risk and uncertainty. The factors that could cause actual results to differ materially from these forward-looking statements include those discussed herein as well as (1) those discussed in the company’s Annual Report on Form 10-K for the year ended Dec. 31, 2010 (a) under the heading, “Forward-Looking Statements,” (b) in ITEM 1. Business, (c) in ITEM 1A. Risk Factors, (d) in ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, and (e) in ITEM 8. Financial Statements and Supplementary Data: Notes 13 and 15; (2) those discussed in the company’s Quarterly Report on Form 10-Q filed Nov. 3, 2011 (a) in ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations and (b) in Part 1, Financial Information, ITEM 1. Financial Statements: Notes 8 and 9; and (3) other factors discussed in the company’s filings with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date such statement was made, and the company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement was made.

 


Westar Energy announces third quarter 2011 results    Page 4 of 4

 

Attachment 1

WESTAR ENERGY, INC.

CONSOLIDATED STATEMENTS OF INCOME

(UNAUDITED)

(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

 

     Three Months Ended September 30,     Nine Months Ended September 30,  
     2011      2010     Change     2011      2010     Change  

Retail

   $ 529,582       $ 502,325      $ 27,257      $ 1,286,978       $ 1,206,261      $ 80,717   

Wholesale

     101,086         94,117        6,969        257,195         255,865        1,330   

Transmission

     39,075         35,554        3,521        115,411         108,497        6,914   

Other

     8,409         12,441        (4,032     25,179         28,825        (3,646
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Total Revenues

     678,152       $ 644,437        33,715        1,684,763         1,599,448        85,315   

Fuel and purchased power

     199,540         187,877        11,663        486,697         458,793        27,904   

Operating and maintenance

     137,823         126,602        11,221        412,429         369,584        42,845   

Depreciation and amortization

     72,202         67,918        4,284        213,551         201,955        11,596   

Selling, general and administrative

     27,499         50,418        (22,919     132,233         144,499        (12,266
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Total Operating Expenses

     437,064         432,815        4,249        1,244,910         1,174,831        70,079   
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Income from Operations

     241,088         211,622        29,466        439,853         424,617        15,236   

Other income (expense)

     848         (1     849        514         (3,901     4,415   

Interest expense

     43,844         43,956        (112     130,681         131,862        (1,181

Income tax expense

     61,700         51,802        9,898        94,812         86,780        8,032   
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Net Income

     136,392         115,863        20,529        214,874         202,074        12,800   

Less: Net income attributable to noncontrolling interests

     1,442         1,119        323        4,212         3,338        874   
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Net income attributable to Westar Energy

     134,950         114,744        20,206        210,662         198,736        11,926   

Preferred dividends

     242         242        —          727         727        —     
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Net Income Attributable to Common Stock

   $ 134,708       $ 114,502      $ 20,206      $ 209,935       $ 198,009      $ 11,926   
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Earnings per common share, basic

   $ 1.15       $ 1.02      $ 0.13      $ 1.82       $ 1.77      $ 0.05   
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Average equivalent common shares outstanding

     116,807         111,707        5,100        115,209         111,387        3,822   

Dividend declared per share

   $ 0.32       $ 0.31      $ 0.01      $ 0.96       $ 0.93      $ 0.03