Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K PRESS RELEASE Q2 2012 - NORTHWESTERN CORP | form8kearningsrelease.htm |
 | NorthWestern Corporation d/b/a NorthWestern Energy 3010 W. 69th Street Sioux Falls, SD 57108 www.northwesternenergy.com | |
NYSE: NWE News Release FOR IMMEDIATE RELEASE | Media Contact: Claudia Rapkoch (866) 622-8081 claudia.rapkoch@northwestern.com Investor Relations Contact: Dan Rausch (605) 978-2902 daniel.rausch@northwestern.com | |
NORTHWESTERN REPORTS SECOND QUARTER 2012 FINANCIAL RESULTS
Reports earnings per share of $0.31 for quarter
Reaffirms guidance for 2012 of $2.35 - $2.50 per fully diluted share
Announced a quarterly dividend of $0.37 per share, payable September 30, 2012
SIOUX FALLS, S.D. - July 24, 2012 - NorthWestern Corporation d/b/a NorthWestern Energy (NYSE: NWE) reported financial results for the quarter ended June 30, 2012. Net income was $11.4 million, or $0.31 per fully diluted share, for the quarter ended June 30, 2012, compared with net income of $11.0 million, or $0.30 per fully diluted share, for the quarter ended June 30, 2011.
Income before income taxes for the quarter ended June 30, 2012 improved by $3.5 million, from $10.5 million to $14.0 million, compared with the quarter ended June 30, 2011. However, income tax expense for the three months ended June 30, 2012 was $2.6 million, as compared with an income tax benefit of $0.5 million in the same period of 2011.
“Our quarterly earnings of $.31/ share approximated our expectations,” said Bob Rowe, President and CEO. “We continue to focus on investments to serve our customers, while working with our employees to control costs. This has allowed us to maintain our financial results despite an unseasonably mild spring in our service territories,” added Rowe.
Highlights for second quarter of 2012
• | Entered into an Equity Distribution Agreement with UBS Securities LLC. Under this agreement we sold 687,285 shares of common stock at an average price of $35.40 per share; and |
• | Priced $90 million of First Mortgage Bonds at 4.15% and $60 million of First Mortgage Bonds at 4.30%, which are expected to be issued in August 2012. |
Summary Financial Results
The following table reconciles the primary changes from 2011 to 2012:
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 1
Three Months Ended | Six Months Ended | ||||||||||||||||||||
Pre-tax | Net | EPS | Pre-tax | Net | EPS | ||||||||||||||||
Income | Income(1) | Diluted | Income | Income(1) | Diluted | ||||||||||||||||
2011 reported | $ | 10.5 | $ | 11.0 | $ | 0.30 | $ | 52.2 | $ | 43.5 | $ | 1.19 | |||||||||
Gross Margin | |||||||||||||||||||||
Demand-side management (DSM) lost revenues | 4.5 | 2.8 | 0.08 | 4.5 | 2.8 | 0.08 | |||||||||||||||
DGGS | 0.5 | 0.3 | 0.01 | 5.0 | 3.1 | 0.08 | |||||||||||||||
Montana property tax tracker | 2.3 | 1.4 | 0.04 | 1.0 | 0.6 | 0.02 | |||||||||||||||
Transmission capacity | 1.1 | 0.7 | 0.02 | 1.3 | 0.8 | 0.02 | |||||||||||||||
South Dakota natural gas rate increase | 0.4 | 0.2 | 0.01 | 1.0 | 0.6 | 0.02 | |||||||||||||||
Operating expenses recovered in trackers | 0.2 | 0.1 | — | — | — | — | |||||||||||||||
Gas production | — | — | — | (0.8 | ) | (0.5 | ) | (0.01 | ) | ||||||||||||
Electric retail volumes | — | — | — | (4.2 | ) | (2.6 | ) | (0.07 | ) | ||||||||||||
Natural gas retail volumes | (2.4 | ) | (1.5 | ) | (0.04 | ) | (6.0 | ) | (3.7 | ) | (0.10 | ) | |||||||||
Other | 0.2 | 0.1 | — | (0.5 | ) | (0.3 | ) | (0.01 | ) | ||||||||||||
Subtotal - Gross Margin | 6.8 | 4.1 | 0.12 | 1.3 | 0.8 | 0.03 | |||||||||||||||
OG&A Expense | |||||||||||||||||||||
Operating and maintenance | 0.6 | 0.4 | 0.01 | 2.4 | 1.5 | 0.04 | |||||||||||||||
Bad debt expense | 1.3 | 0.8 | 0.02 | 1.2 | 0.7 | 0.02 | |||||||||||||||
Plant operator costs | 0.5 | 0.3 | 0.01 | 0.6 | 0.4 | 0.01 | |||||||||||||||
Operating expenses recovered in energy supply trackers | (0.2 | ) | (0.1 | ) | — | — | — | — | |||||||||||||
Other | 0.2 | 0.1 | — | — | — | — | |||||||||||||||
Subtotal - OG&A Expense | 2.4 | 1.5 | 0.04 | 4.2 | 2.6 | 0.07 | |||||||||||||||
Other | |||||||||||||||||||||
Depreciation expense | (1.3 | ) | (0.8 | ) | (0.02 | ) | (2.5 | ) | (1.5 | ) | (0.04 | ) | |||||||||
Property and other taxes | (5.3 | ) | (3.3 | ) | (0.09 | ) | (3.7 | ) | (2.3 | ) | (0.06 | ) | |||||||||
Interest Expense | 1.0 | 0.6 | 0.02 | 2.1 | 1.3 | 0.04 | |||||||||||||||
Other Income | 0.1 | 0.1 | — | 0.3 | 0.2 | 0.01 | |||||||||||||||
Items related to income tax | |||||||||||||||||||||
Flow-through repairs deductions | 0.6 | 0.02 | 2.2 | 0.06 | |||||||||||||||||
Flow-through of state bonus depreciation deduction | (0.2 | ) | — | (1.4 | ) | (0.04 | ) | ||||||||||||||
Recognition of state net operating loss benefit/valuation allowance release | (1.6 | ) | (0.04 | ) | (2.4 | ) | (0.07 | ) | |||||||||||||
State income tax and other, net | (0.8 | ) | (0.02 | ) | 0.3 | 0.01 | |||||||||||||||
All other, net | (0.2 | ) | 0.1 | (0.02 | ) | 0.2 | 0.1 | (0.01 | ) | ||||||||||||
Total EPS impact of above items | 0.01 | — | |||||||||||||||||||
2012 reported | $ | 14.0 | $ | 11.4 | $ | 0.31 | $ | 54.1 | $ | 43.5 | $ | 1.19 | |||||||||
(1) Income Tax Benefit (Expense) calculation on reconciling items assumes normal effective tax rate of 38.5%. | |||||||||||||||||||||
For more information see www.northwesternenergy.com/documents/investor/Q212.pdf
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 2
Significant Drivers
Gross Margin
Consolidated gross margin for the second quarter of 2012 was $148.2 million compared with $141.4 million for same period of 2011. The increase in gross margin includes the following:
• | An increase in demand side management ("DSM") lost revenues recovered through our electric supply tracker related to our DSM efficiency programs (DSM lost revenues described further below); |
• | An increase in Montana property taxes included in a tracker as compared to the same period in 2011; |
• | An increase in transmission capacity revenues due to higher demand to transmit energy for others across our lines; |
• | Higher Dave Gates Generating Station ("DGGS") related revenues; |
• | An increase in South Dakota natural gas rates; and |
• | Higher revenues for operating expenses recovered in trackers, primarily related to customer efficiency programs and environmental remediation costs; |
• | These increases were partly offset by a decrease in natural gas retail volumes due primarily to warmer spring weather. |
DSM lost revenues - Base rates, including impacts of past DSM activities, are reset in general rate case filings. As time passes between rate cases, more energy saving measures (primarily more efficient residential and commercial lighting) are implemented, causing an increase in DSM lost revenues. During the second quarter of 2012, we recognized approximately $6.6 million of DSM lost revenues as compared with approximately $2.1 million during the second quarter of 2011. The 2012 amount includes $3.3 million in DSM lost revenues for the July 2010 through June 2011 tracker period, which we recognized as revenue when we received MPSC approval in April 2012.
Consolidated gross margin for the six months ended June 30, 2012 was $318.9 million compared with $317.6 million for same period of 2011.
Operating, General and Administrative Expenses
Consolidated operating, general and administrative expenses were $67.1 million for the quarter ended June 30, 2012 as compared with $69.5 million during the same period of 2011. The decrease in operating, general and administrative expenses was primarily due to lower bad debt expense based on higher collections from customers, a timing related decrease in proactive line maintenance and tree trimming as more time was spent on capital projects as compared with the same period in 2011, and lower plant operator costs at Colstrip Unit 4. These decreases were partly offset by higher operating expenses primarily related to costs incurred for customer efficiency programs and environmental remediation costs, which are recovered from customers through trackers and have no impact on operating income.
Consolidated operating, general and administrative expenses were $132.7 million for the six months ended June 30, 2012 as compared with $136.9 million during the same period of 2011.
Property and Other Taxes
Consolidated property and other taxes were $25.9 million for the quarter ended June 30, 2012 as compared with $20.6 million during the same period of 2011. This increase was due primarily to
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 3
higher assessed property valuations in Montana and plant additions. The higher assessed property valuations are primarily due to a lower capitalization rate used by the Montana Department of Revenue.
Consolidated property and other taxes were $49.6 million for six months ended June 30, 2012 as compared with $45.9 million during the same period of 2011.
Interest Expense
Consolidated interest expense was $15.9 million for the quarter ended June 30, 2012 as compared with $16.9 million during the same period of 2011. This decrease was primarily due to lower interest rates on debt outstanding and higher capitalization of AFUDC.
Consolidated interest expense was $31.9 million for the six months ended June 30, 2012 as compared with $34.0 million during the same period of 2011.
Income Tax Expense
Consolidated income tax expense in the second quarter of 2012 was $2.6 million as compared with $0.5 million income tax benefit in same period of 2011. The effective tax rate for the three months ended June 30, 2012 was 18.3% as compared with (4.9)% for the same period of 2011. The increase in income tax expense for the second quarter of 2012 was primarily due to higher taxable income and the absence of a benefit during the second quarter of 2011 which released $1.6 million in state net operating loss (NOL) carryforward reserves. The effective tax rate differs from the federal statutory tax rate of 35.0% primarily due to repairs and state tax bonus depreciation deductions.
Consolidated income tax expense for the six months ended June 30, 2012 was $10.6 million as compared with $8.7 million in same period of 2011. The effective tax rate for the six months ended June 30, 2012 was 19.6% as compared with 16.6% for the same period of 2011.
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 4
The following table summarizes the significant differences from the Federal statutory rate, which result in reduced income tax expense:
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
(in millions) | |||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Income Before Income Taxes | $ | 14,003 | $ | 10,454 | $ | 54,058 | $ | 52,207 | |||||||
Income tax calculated at 35% federal statutory rate | (4,901 | ) | (3,659 | ) | (18,920 | ) | (18,272 | ) | |||||||
Permanent or flow through adjustments: | |||||||||||||||
Flow-through repairs deductions | 2,168 | 1,520 | 7,739 | 5,502 | |||||||||||
Flow-through of state bonus depreciation deduction | 512 | 679 | 1,883 | 3,282 | |||||||||||
Recognition of state NOL benefit/valuation allowance release | — | 1,555 | — | 2,402 | |||||||||||
State income tax and other, net | (344 | ) | 421 | (1,279 | ) | (1,576 | ) | ||||||||
$ | 2,336 | $ | 4,175 | $ | 8,343 | $ | 9,610 | ||||||||
Income tax expense | $ | (2,565 | ) | $ | 516 | $ | (10,577 | ) | $ | (8,662 | ) | ||||
Regulated Operations
In the regulated operations for the three months ended June 30, 2012, electric net income improved $2.7 million, due primarily to an increase in DSM lost revenues recovered through our electric supply tracker, higher property taxes included in the tracker, and an increase in transmission revenues due to higher demand to transmit energy for others; offset by higher property and other tax expense and higher depreciation expense. Natural gas net income declined $1.1 million, due primarily to a decrease in gross margins caused by warmer spring weather in our service territories and higher property taxes, offset in part by a reduction in interest expense and operating, general and other expenses.
For the six months ended June 30, 2012, in the regulated operations, electric net income improved $3.1 million, and natural gas net income declined $1.8 million.
Liquidity and Capital Resources
As of June 30, 2012, cash and cash equivalents were $8.1 million compared with $5.9 million at December 31, 2011. The Company had $162.0 million available from its revolving credit facility at June 30, 2012, compared with $130.1 million at December 31, 2011.
Dividend Declaration
NorthWestern's Board of Directors declared a quarterly common stock dividend of $0.37 per share, payable September 30, 2012, to common shareholders of record as of September 15, 2012.
Update on DGGS Outage
As previously reported, DGGS was shut down on January 31, 2012 after problems were discovered in the power turbines of two of the generation units. Similar problems were subsequently found in the third unit. There are two power turbines per unit, and as of June 30, 2012 five of the six turbines have been
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 5
returned to service using a combination of the original turbines after servicing by their supplier Pratt & Whitney Power Systems (PWPS) and turbines on loan from PWPS. Between February and April 2012, we acquired regulation service from third parties, which resulted in incremental costs of approximately $1.4 million, as compared to fully operating DGGS. As of May 1, 2012, we had eliminated our contracted replacement services and are no longer incurring incremental costs. We believe the incremental contracted costs for regulation service should be recoverable from customers through our normal course of business; however, there can be no assurance that the MPSC and/or FERC will allow us full recovery of such costs.
2012 Earnings Outlook
NorthWestern reaffirms its earnings for 2012 to be $2.35 - $2.50 per fully diluted share.
Basic assumptions include the following expectations:
• | A consolidated income tax rate of approximately 16% - 18% of pre-tax income; |
• | No scheduled maintenance at Colstrip Unit 4 and Big Stone Plants; |
• | DGGS outage costs fully recovered; |
• | That we have no impairment on the $23.5 million in preliminary survey and investigative costs related to our proposed Mountain States Transmission Intertie (MSTI) transmission project; |
• | Fully diluted average shares outstanding of 37.1 million for 2012; and |
• | Normal weather in the Company's electric and natural gas service territories for the remainder of 2012. |
Company Hosting Investor Conference Call
NorthWestern will host an investor conference call today at 4:00 pm Eastern Time to review its financial results for the quarter and six months ended June 30, 2012.
The conference call will be webcast live on the Internet at http://www.northwesternenergy.com under the “Investor Information” heading. To listen, please go to the site at least 10 minutes in advance of the call to register. An archived webcast will be available shortly after the call.
A telephonic replay of the call will be available beginning at 6:00 p.m. ET on July 24, 2012, through August 23, 2012, at (888) 203-1112 access code 3759413.
About NorthWestern Energy
NorthWestern Energy is one of the largest providers of electricity and natural gas in the Upper Midwest and Northwest, serving approximately 668,300 customers in Montana, South Dakota and Nebraska. More information on NorthWestern Energy is available on the Company's Web site at www.northwesternenergy.com.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including, without limitation, the information under “2012 Earnings Outlook”. Forward-looking statements often address our expected future business and financial performance, and often contain words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” or “will.” These statements are based upon our current expectations and speak only as of the date hereof. Our actual future business and financial performance may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 6
uncertainties, including, but not limited to:
• | potential adverse federal, state, or local legislation or regulation or adverse determinations by regulators could have a material effect on our liquidity, results of operations and financial condition; |
• | we have capitalized approximately $23.5 million in preliminary survey and investigative costs related to our proposed MSTI transmission project. If we abandon our efforts to pursue MSTI we may have to write-off all or a portion these costs, which could have a material effect on our results of operations; |
• | changes in availability of trade credit, creditworthiness of counterparties, usage, commodity prices, fuel supply costs or availability due to higher demand, shortages, weather conditions, transportation problems or other developments, may reduce revenues or may increase operating costs, each of which could adversely affect our liquidity and results of operations; |
• | unscheduled generation outages or forced reductions in output, maintenance or repairs, which may reduce revenues and increase cost of sales or may require additional capital expenditures or other increased operating costs; and |
• | adverse changes in general economic and competitive conditions in the U.S. financial markets and in our service territories. |
Our Annual Report on Form 10-K, recent and forthcoming Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K and other Securities and Exchange Commission filings discuss some of the important risk factors that may affect our business, results of operations and financial condition.
We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Non-GAAP Financial Measure
This press release includes financial information prepared in accordance with GAAP, as well as another financial measure, Gross Margin, that is considered a “non-GAAP financial measure.” Generally, a non-GAAP financial measure is a numerical measure of a company's financial performance, financial position or cash flows that exclude (or include) amounts that are included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP. Gross Margin (Revenues less Cost of Sales) is a non-GAAP financial measure due to the exclusion of depreciation from the measure. The presentation of Gross Margin is intended to supplement investors' understanding of our operating performance. Gross Margin is used by us to determine whether we are collecting the appropriate amount of energy costs from customers to allow recovery of operating costs. Our Gross Margin measure may not be comparable to other companies' Gross Margin measure. Furthermore, this measure is not intended to replace operating income as determined in accordance with GAAP as an indicator of operating performance.
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 7
NORTHWESTERN CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(in thousands, except per share amounts)
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||||
Revenues | |||||||||||||||
Electric | 196,176 | 186,789 | 403,231 | 395,411 | |||||||||||
Gas | 48,101 | 64,692 | 149,847 | 193,904 | |||||||||||
Other | 326 | 325 | 625 | 751 | |||||||||||
Total Revenues | 244,603 | 251,806 | 553,703 | 590,066 | |||||||||||
Operating Expenses | |||||||||||||||
Cost of sales | 96,427 | 110,407 | 234,823 | 272,478 | |||||||||||
Operating, general and administrative | 67,096 | 69,539 | 132,669 | 136,922 | |||||||||||
Property and other taxes | 25,934 | 20,550 | 49,599 | 45,946 | |||||||||||
Depreciation | 26,426 | 25,066 | 52,859 | 50,381 | |||||||||||
Total Operating Expenses | 215,883 | 225,562 | 469,950 | 505,727 | |||||||||||
Operating Income | 28,720 | 26,244 | 83,753 | 84,339 | |||||||||||
Interest Expense, net | (15,893 | ) | (16,896 | ) | (31,855 | ) | (34,043 | ) | |||||||
Other Income | 1,176 | 1,106 | 2,160 | 1,911 | |||||||||||
Income Before Income Taxes | 14,003 | 10,454 | 54,058 | 52,207 | |||||||||||
Income Tax (Expense) Benefit | (2,565 | ) | 516 | (10,577 | ) | (8,662 | ) | ||||||||
Net Income | 11,438 | 10,970 | 43,481 | 43,545 | |||||||||||
Other comprehensive (loss) income, net of tax: | |||||||||||||||
Reclassification of net gains on derivative instruments | (191 | ) | (297 | ) | (374 | ) | (594 | ) | |||||||
Postretirement medical liability adjustment | — | — | 205 | — | |||||||||||
Foreign currency translation | 46 | 18 | (1 | ) | 69 | ||||||||||
Total Other Comprehensive Loss | (145 | ) | (279 | ) | (170 | ) | (525 | ) | |||||||
Comprehensive Income | 11,293 | 10,691 | 43,311 | 43,020 | |||||||||||
Average Common Shares Outstanding | 36,635 | 36,258 | 36,482 | 36,250 | |||||||||||
Basic Earnings per Average Common Share | $ | 0.31 | $ | 0.30 | $ | 1.19 | $ | 1.20 | |||||||
Diluted Earnings per Average Common Share | $ | 0.31 | $ | 0.30 | $ | 1.19 | $ | 1.19 | |||||||
Dividends Declared per Average Common Share | $ | 0.37 | $ | 0.36 | $ | 0.74 | $ | 0.72 | |||||||
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 8
NORTHWESTERN CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(in thousands)
June 30, 2012 | December 31, 2011 | ||||
ASSETS | |||||
Current Assets | 233,607 | 290,199 | |||
Property, Plant, and Equipment, Net | 2,266,196 | 2,213,267 | |||
Goodwill | 355,128 | 355,128 | |||
Regulatory Assets | 320,860 | 308,804 | |||
Other Noncurrent Assets | 48,298 | 43,040 | |||
Total Assets | 3,224,089 | 3,210,438 | |||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||
Current Maturities of Long-term Debt and Capital Leases | 1,561 | 5,162 | |||
Commercial Paper | 129,968 | 166,934 | |||
Current Liabilities | 263,162 | 303,858 | |||
Long-term Capital Leases | 32,395 | 32,918 | |||
Long-term Debt | 905,061 | 905,049 | |||
Noncurrent Regulatory Liabilities | 270,219 | 265,987 | |||
Deferred Income Taxes | 321,408 | 282,406 | |||
Other Noncurrent Liabilities | 399,113 | 389,012 | |||
Total Liabilities | 2,322,887 | 2,351,326 | |||
Total Shareholders' Equity | 901,202 | 859,112 | |||
Total Liabilities and Shareholders' Equity | 3,224,089 | 3,210,438 | |||
NORTHWESTERN CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
Six Months Ended June 30, | |||||
2012 | 2011 | ||||
Operating Activities | |||||
Net income | 43,481 | 43,545 | |||
Non-cash items | 79,791 | 77,237 | |||
Changes in operating assets and liabilities | 21,795 | 42,678 | |||
Cash Provided by Operating Activities | 145,067 | 163,460 | |||
Cash Used in Investing Activities | (97,663 | ) | (71,648 | ) | |
Cash Used In Financing Activities | (45,227 | ) | (93,506 | ) | |
Net Increase (Decrease) in Cash and Cash Equivalents | 2,177 | (1,694 | ) | ||
Cash and Cash Equivalents, beginning of period | 5,928 | 6,234 | |||
Cash and Cash Equivalents, end of period | 8,105 | 4,540 | |||
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 9
NORTHWESTERN CORPORATION
REGULATED ELECTRIC SEGMENT
Three Months Ended June 30,
(Unaudited)
Results | ||||||||||||||
2012 | 2011 | Change | % Change | |||||||||||
Retail revenue | $ | 166.7 | $ | 166.9 | $ | (0.2 | ) | (0.1 | )% | |||||
Transmission | 11.0 | 9.9 | 1.1 | 11.1 | % | |||||||||
Wholesale | 0.7 | 0.8 | (0.1 | ) | (12.5 | )% | ||||||||
Regulatory amortization and other | 17.8 | 9.2 | 8.6 | 93.5 | % | |||||||||
Total Revenues | $ | 196.2 | $ | 186.8 | $ | 9.4 | 5.0 | % | ||||||
Total Cost of Sales | 78.1 | 76.9 | 1.2 | 1.6 | % | |||||||||
Gross Margin | $ | 118.1 | $ | 109.9 | $ | 8.2 | 7.5 | % | ||||||
Revenue | Megawatt Hours (MWH) | Avg. Customer Counts | |||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | ||||||||||||
Retail Electric | |||||||||||||||||
Montana | 52,681 | 53,662 | 491 | 503 | 273,840 | 272,328 | |||||||||||
South Dakota | 10,060 | 10,305 | 106 | 119 | 48,883 | 48,611 | |||||||||||
Residential | 62,741 | 63,967 | 597 | 622 | 322,723 | 320,939 | |||||||||||
Montana | 71,197 | 71,789 | 756 | 747 | 61,948 | 61,465 | |||||||||||
South Dakota | 16,328 | 15,363 | 217 | 213 | 12,160 | 11,971 | |||||||||||
Commercial | 87,525 | 87,152 | 973 | 960 | 74,108 | 73,436 | |||||||||||
Industrial | 8,537 | 9,579 | 682 | 704 | 74 | 72 | |||||||||||
Other | 7,871 | 6,238 | 51 | 34 | 5,977 | 5,610 | |||||||||||
Total Retail Electric | 166,674 | 166,936 | 2,303 | 2,320 | 402,882 | 400,057 | |||||||||||
Total Wholesale Electric | 733 | 820 | 43 | 42 | — | — | |||||||||||
Degree Days | 2012 as compared with: | ||||||||||
Heating Degree-Days | 2012 | 2011 | Historic Average | 2011 | Historic Average | ||||||
Montana | 1,205 | 1,510 | 1,321 | 20% warmer | 34% warmer | ||||||
South Dakota | 893 | 1,572 | 1,497 | 43% warmer | 127% warmer | ||||||
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 10
NORTHWESTERN CORPORATION
REGULATED ELECTRIC SEGMENT
Six Months Ended June 30,
(Unaudited)
Results | ||||||||||||||
2012 | 2011 | Change | % Change | |||||||||||
Retail revenue | $ | 358.6 | $ | 363.1 | $ | (4.5 | ) | (1.2 | )% | |||||
Transmission | 22.1 | 20.8 | 1.3 | 6.3 | % | |||||||||
Wholesale | 1.6 | 1.2 | 0.4 | 33.3 | % | |||||||||
Regulatory amortization and other | 20.9 | 10.3 | 10.6 | 102.9 | % | |||||||||
Total Revenues | $ | 403.2 | $ | 395.4 | $ | 7.8 | 2.0 | % | ||||||
Total Cost of Sales | 161.1 | 161.4 | (0.3 | ) | (0.2 | )% | ||||||||
Gross Margin | $ | 242.1 | $ | 234.0 | $ | 8.1 | 3.5 | % | ||||||
Revenue | Megawatt Hours (MWH) | Avg. Customer Counts | |||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | ||||||||||||
Retail Electric | |||||||||||||||||
Montana | 124,818 | 129,325 | 1,162 | 1,233 | 274,003 | 272,426 | |||||||||||
South Dakota | 23,046 | 23,698 | 266 | 298 | 48,861 | 48,658 | |||||||||||
Residential | 147,864 | 153,023 | 1,428 | 1,531 | 322,864 | 321,084 | |||||||||||
Montana | 146,893 | 148,922 | 1,549 | 1,567 | 61,980 | 61,462 | |||||||||||
South Dakota | 33,244 | 31,672 | 453 | 452 | 12,057 | 11,880 | |||||||||||
Commercial | 180,137 | 180,594 | 2,002 | 2,019 | 74,037 | 73,342 | |||||||||||
Industrial | 18,174 | 18,762 | 1,411 | 1,396 | 73 | 72 | |||||||||||
Other | 12,452 | 10,758 | 75 | 58 | 5,243 | 5,116 | |||||||||||
Total Retail Electric | 358,627 | 363,137 | 4,916 | 5,004 | 402,217 | 399,614 | |||||||||||
Total Wholesale Electric | 1,602 | 1,129 | 96 | 73 | — | — | |||||||||||
Degree Days | 2012 as compared with: | ||||||||||
Heating Degree-Days | 2012 | 2011 | Historic Average | 2011 | Historic Average | ||||||
Montana | 4,244 | 5,000 | 4,640 | 15% warmer | 9% warmer | ||||||
South Dakota | 4,310 | 6,141 | 5,600 | 30% warmer | 23% warmer | ||||||
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 11
NORTHWESTERN CORPORATION
REGULATED NATURAL GAS SEGMENT
Three Months Ended June 30,
(Unaudited)
Results | ||||||||||||||
2012 | 2011 | Change | % Change | |||||||||||
Retail revenue | $ | 34.5 | $ | 54.7 | $ | (20.2 | ) | (36.9 | )% | |||||
Wholesale and other | 13.6 | 10.0 | 3.6 | 36.0 | % | |||||||||
Total Revenues | 48.1 | 64.7 | (16.6 | ) | (25.7 | )% | ||||||||
Total Cost of Sales | 18.3 | 33.5 | (15.2 | ) | (45.4 | )% | ||||||||
Gross Margin | $ | 29.8 | $ | 31.2 | $ | (1.4 | ) | (4.5 | )% | |||||
Revenue | Dekatherms (Dkt) | Avg. Customer Counts | |||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | ||||||||||||
Retail Gas | |||||||||||||||||
Montana | 16,415 | 24,302 | 1,915 | 2,455 | 159,539 | 158,851 | |||||||||||
South Dakota | 3,327 | 5,565 | 341 | 613 | 37,727 | 37,223 | |||||||||||
Nebraska | 2,926 | 4,882 | 287 | 500 | 36,420 | 36,452 | |||||||||||
Residential | 22,668 | 34,749 | 2,543 | 3,568 | 233,686 | 232,526 | |||||||||||
Montana | 8,187 | 12,085 | 965 | 1,227 | 22,380 | 22,267 | |||||||||||
South Dakota | 1,873 | 3,978 | 323 | 577 | 5,950 | 5,954 | |||||||||||
Nebraska | 1,480 | 3,465 | 263 | 566 | 4,556 | 4,567 | |||||||||||
Commercial | 11,540 | 19,528 | 1,551 | 2,370 | 32,886 | 32,788 | |||||||||||
Industrial | 136 | 228 | 16 | 24 | 274 | 278 | |||||||||||
Other | 178 | 231 | 24 | 28 | 150 | 145 | |||||||||||
Total Retail Gas | 34,522 | 54,736 | 4,134 | 5,990 | 266,996 | 265,737 | |||||||||||
Degree Days | 2012 as compared with: | ||||||||||
Heating Degree-Days | 2012 | 2011 | Historic Average | 2011 | Historic Average | ||||||
Montana | 1,205 | 1,510 | 1,321 | 20% warmer | 9% warmer | ||||||
South Dakota | 893 | 1,572 | 1,497 | 43% warmer | 40% warmer | ||||||
Nebraska | 635 | 1,225 | 1,228 | 48% warmer | 48% warmer | ||||||
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 12
NORTHWESTERN CORPORATION
REGULATED NATURAL GAS SEGMENT
Six Months Ended June 30,
(Unaudited)
Results | ||||||||||||||
2012 | 2011 | Change | % Change | |||||||||||
Retail revenue | $ | 130.1 | $ | 175.8 | $ | (45.7 | ) | (26.0 | )% | |||||
Wholesale and other | 19.8 | 18.1 | 1.7 | 9.4 | % | |||||||||
Total Revenues | 149.9 | 193.9 | (44.0 | ) | (22.7 | )% | ||||||||
Total Cost of Sales | 73.7 | 111.1 | (37.4 | ) | (33.7 | )% | ||||||||
Gross Margin | $ | 76.2 | $ | 82.8 | $ | (6.6 | ) | (8.0 | )% | |||||
Revenue | Dekatherms (Dkt) | Avg. Customer Counts | |||||||||||||||
2012 | 2011 | 2012 | 2011 | 2012 | 2011 | ||||||||||||
Retail Gas | |||||||||||||||||
Montana | 58,254 | 75,402 | 6,898 | 8,093 | 159,712 | 158,940 | |||||||||||
South Dakota | 13,690 | 18,871 | 1,597 | 2,212 | 37,913 | 37,467 | |||||||||||
Nebraska | 12,347 | 16,367 | 1,429 | 1,882 | 36,669 | 36,700 | |||||||||||
Residential | 84,291 | 110,640 | 9,924 | 12,187 | 234,294 | 233,107 | |||||||||||
Montana | 29,238 | 38,523 | 3,489 | 4,142 | 22,403 | 22,270 | |||||||||||
South Dakota | 8,526 | 13,280 | 1,373 | 1,909 | 5,976 | 5,954 | |||||||||||
Nebraska | 6,894 | 11,708 | 1,092 | 1,853 | 4,598 | 4,602 | |||||||||||
Commercial | 44,658 | 63,511 | 5,954 | 7,904 | 32,977 | 32,826 | |||||||||||
Industrial | 579 | 920 | 70 | 102 | 276 | 280 | |||||||||||
Other | 573 | 680 | 77 | 86 | 150 | 145 | |||||||||||
Total Retail Gas | 130,101 | 175,751 | 16,025 | 20,279 | 267,697 | 266,358 | |||||||||||
Degree Days | 2012 as compared with: | ||||||||||
Heating Degree-Days | 2012 | 2011 | Historic Average | 2011 | Historic Average | ||||||
Montana | 4,244 | 5,000 | 4,640 | 15% warmer | 9% warmer | ||||||
South Dakota | 4,310 | 6,141 | 4,600 | 30% warmer | 23% warmer | ||||||
Nebraska | 3,584 | 4,798 | 4,638 | 25% warmer | 23% warmer | ||||||
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 13
NORTHWESTERN CORPORATION
SECOND QUARTER SEGMENT RESULTS
(Unaudited)
(in thousands)
Three Months Ended | |||||||||||||||||||
June 30, 2012 | Electric | Gas | Other | Eliminations | Total | ||||||||||||||
Operating revenues | $ | 196,176 | $ | 48,101 | $ | 326 | $ | — | $ | 244,603 | |||||||||
Cost of sales | 78,109 | 18,318 | — | — | 96,427 | ||||||||||||||
Gross margin | 118,067 | 29,783 | 326 | — | 148,176 | ||||||||||||||
Operating, general and administrative | 47,685 | 18,657 | 754 | — | 67,096 | ||||||||||||||
Property and other taxes | 19,469 | 6,463 | 2 | — | 25,934 | ||||||||||||||
Depreciation | 21,565 | 4,853 | 8 | — | 26,426 | ||||||||||||||
Operating income (loss) | 29,348 | (190 | ) | (438 | ) | — | 28,720 | ||||||||||||
Interest expense | (13,409 | ) | (2,230 | ) | (254 | ) | — | (15,893 | ) | ||||||||||
Other income | 801 | 349 | 26 | — | 1,176 | ||||||||||||||
Income tax (expense) benefit | (5,910 | ) | 1,010 | 2,335 | — | (2,565 | ) | ||||||||||||
Net income (loss) | $ | 10,830 | $ | (1,061 | ) | $ | 1,669 | $ | — | $ | 11,438 | ||||||||
Total assets | $ | 2,268,913 | $ | 943,471 | $ | 11,705 | $ | — | $ | 3,224,089 | |||||||||
Capital expenditures | $ | 44,712 | $ | 5,993 | $ | — | $ | — | $ | 50,705 | |||||||||
Three Months Ended | |||||||||||||||||||
June 30, 2011 | Electric | Gas | Other | Eliminations | Total | ||||||||||||||
Operating revenues | $ | 186,789 | $ | 64,692 | $ | 325 | $ | — | $ | 251,806 | |||||||||
Cost of sales | 76,925 | 33,482 | — | — | 110,407 | ||||||||||||||
Gross margin | 109,864 | 31,210 | 325 | — | 141,399 | ||||||||||||||
Operating, general and administrative | 49,374 | 19,224 | 941 | — | 69,539 | ||||||||||||||
Property and other taxes | 15,302 | 5,246 | 2 | — | 20,550 | ||||||||||||||
Depreciation | 20,386 | 4,671 | 9 | — | 25,066 | ||||||||||||||
Operating income (loss) | 24,802 | 2,069 | (627 | ) | — | 26,244 | |||||||||||||
Interest expense | (13,689 | ) | (2,729 | ) | (478 | ) | — | (16,896 | ) | ||||||||||
Other income | 724 | 355 | 27 | — | 1,106 | ||||||||||||||
Income tax (expense) benefit | (3,670 | ) | 326 | 3,860 | — | 516 | |||||||||||||
Net income | $ | 8,167 | $ | 21 | $ | 2,782 | $ | — | $ | 10,970 | |||||||||
Total assets | $ | 2,116,854 | $ | 877,235 | $ | 12,901 | $ | — | $ | 3,006,990 | |||||||||
Capital expenditures | $ | 28,756 | $ | 5,521 | $ | — | $ | — | $ | 34,277 | |||||||||
NorthWestern Reports Second Quarter 2012 Financial Results
July 24, 2012
Page 14
Six Months Ended | |||||||||||||||||||
June 30, 2012 | Electric | Gas | Other | Eliminations | Total | ||||||||||||||
Operating revenues | $ | 403,231 | $ | 149,847 | $ | 625 | $ | — | $ | 553,703 | |||||||||
Cost of sales | 161,088 | 73,735 | — | — | 234,823 | ||||||||||||||
Gross margin | 242,143 | 76,112 | 625 | — | 318,880 | ||||||||||||||
Operating, general and administrative | 93,042 | 37,945 | 1,682 | — | 132,669 | ||||||||||||||
Property and other taxes | 37,007 | 12,587 | 5 | — | 49,599 | ||||||||||||||
Depreciation | 43,134 | 9,709 | 16 | — | 52,859 | ||||||||||||||
Operating income (loss) | 68,960 | 15,871 | (1,078 | ) | — | 83,753 | |||||||||||||
Interest expense | (27,076 | ) | (4,297 | ) | (482 | ) | — | (31,855 | ) | ||||||||||
Other income | 1,413 | 694 | 53 | — | 2,160 | ||||||||||||||
Income tax (expense) benefit | (9,084 | ) | (2,580 | ) | 1,087 | — | (10,577 | ) | |||||||||||
Net income | $ | 34,213 | $ | 9,688 | $ | (420 | ) | $ | — | $ | 43,481 | ||||||||
Total assets | $ | 2,268,913 | $ | 943,471 | $ | 11,705 | $ | — | $ | 3,224,089 | |||||||||
Capital expenditures | $ | 84,791 | $ | 13,021 | $ | — | $ | — | $ | 97,812 | |||||||||
Six Months Ended | |||||||||||||||||||
June 30, 2011 | Electric | Gas | Other | Eliminations | Total | ||||||||||||||
Operating revenues | $ | 395,411 | $ | 193,904 | $ | 751 | $ | — | $ | 590,066 | |||||||||
Cost of sales | 161,371 | 111,107 | — | — | 272,478 | ||||||||||||||
Gross margin | 234,040 | 82,797 | 751 | — | 317,588 | ||||||||||||||
Operating, general and administrative | 94,660 | 40,672 | 1,590 | — | 136,922 | ||||||||||||||
Property and other taxes | 34,043 | 11,898 | 5 | — | 45,946 | ||||||||||||||
Depreciation | 40,740 | 9,624 | 17 | — | 50,381 | ||||||||||||||
Operating income (loss) | 64,597 | 20,603 | (861 | ) | — | 84,339 | |||||||||||||
Interest expense | (27,216 | ) | (5,394 | ) | (1,433 | ) | — | (34,043 | ) | ||||||||||
Other income | 1,339 | 519 | 53 | — | 1,911 | ||||||||||||||
Income tax (expense) benefit | (7,591 | ) | (4,244 | ) | 3,173 | — | (8,662 | ) | |||||||||||
Net income | $ | 31,129 | $ | 11,484 | $ | 932 | $ | — | $ | 43,545 | |||||||||
Total assets | $ | 2,116,854 | $ | 877,235 | $ | 12,901 | $ | — | $ | 3,006,990 | |||||||||
Capital expenditures | $ | 54,850 | $ | 17,007 | $ | — | $ | — | $ | 71,857 | |||||||||