Attached files
| file | filename |
|---|---|
| 8-K - 8-K - WESTAR ENERGY INC /KS | wr-06302015xearningsreleas.htm |
| EX-99.1 - PRESS RELEASE DATED AUGUST 4, 2015 - WESTAR ENERGY INC /KS | wr-06302015x8xkexhibit991.htm |
Exhibit 99.2
Westar Energy, Inc.
Second Quarter 2015 Earnings
Released August 4, 2015
Bruce Burns
Director Investor Relations
785-575-8227
bruce.burns@WestarEnergy.com
NOTE:
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q for the period ended June 30, 2015 should be read in conjunction with this financial information. The enclosed statements have been prepared for the purpose of providing information concerning the Company and not in connection with any sale, offer for sale, or solicitation to buy any securities.
Westar Energy, Inc.
Condensed Consolidated Statements of Income
(Unaudited)
Three Months Ended June 30, | ||||||||||||||
2015 | 2014 | Change | % Change | |||||||||||
(Dollars in Thousands, Except Per Share Amounts) | ||||||||||||||
REVENUES: | ||||||||||||||
Residential | $ | 173,677 | $ | 175,671 | $ | (1,994 | ) | (1.1 | ) | |||||
Commercial | 175,994 | 178,194 | (2,200 | ) | (1.2 | ) | ||||||||
Industrial | 103,151 | 106,984 | (3,833 | ) | (3.6 | ) | ||||||||
Other retail | (7,660 | ) | (3,033 | ) | (4,627 | ) | (152.6 | ) | ||||||
Total Retail Revenues | 445,162 | 457,816 | (12,654 | ) | (2.8 | ) | ||||||||
Wholesale | 74,828 | 82,434 | (7,606 | ) | (9.2 | ) | ||||||||
Transmission | 61,295 | 63,700 | (2,405 | ) | (3.8 | ) | ||||||||
Other | 8,278 | 8,718 | (440 | ) | (5.0 | ) | ||||||||
Total Revenues | 589,563 | 612,668 | (23,105 | ) | (3.8 | ) | ||||||||
OPERATING EXPENSES: | ||||||||||||||
Fuel and purchased power | 140,080 | 164,779 | (24,699 | ) | (15.0 | ) | ||||||||
SPP network transmission costs | 57,352 | 55,533 | 1,819 | 3.3 | ||||||||||
Operating and maintenance | 82,739 | 101,839 | (19,100 | ) | (18.8 | ) | ||||||||
Depreciation and amortization | 76,759 | 70,882 | 5,877 | 8.3 | ||||||||||
Selling, general and administrative | 63,663 | 62,168 | 1,495 | 2.4 | ||||||||||
Taxes other than income tax | 37,494 | 34,738 | 2,756 | 7.9 | ||||||||||
Total Operating Expenses | 458,087 | 489,939 | (31,852 | ) | (6.5 | ) | ||||||||
INCOME FROM OPERATIONS | 131,476 | 122,729 | 8,747 | 7.1 | ||||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||
Investment earnings | 1,634 | 3,175 | (1,541 | ) | (48.5 | ) | ||||||||
Other income | 15,121 | 5,658 | 9,463 | 167.2 | ||||||||||
Other expense | (2,633 | ) | (2,287 | ) | (346 | ) | (15.1 | ) | ||||||
Total Other Income | 14,122 | 6,546 | 7,576 | 115.7 | ||||||||||
Interest expense | 45,516 | 47,303 | (1,787 | ) | (3.8 | ) | ||||||||
INCOME BEFORE INCOME TAXES | 100,082 | 81,972 | 18,110 | 22.1 | ||||||||||
Income tax expense | 33,839 | 26,150 | 7,689 | 29.4 | ||||||||||
NET INCOME | 66,243 | 55,822 | 10,421 | 18.7 | ||||||||||
Less: Net income attributable to noncontrolling interests | 2,533 | 2,349 | 184 | 7.8 | ||||||||||
NET INCOME ATTRIBUTABLE TO WESTAR ENERGY, INC. | $ | 63,710 | $ | 53,473 | $ | 10,237 | 19.1 | |||||||
BASIC AND DILUTED EARNINGS PER AVERAGE COMMON SHARE OUTSTANDING ATTRIBUTABLE TO WESTAR ENERGY, INC. (See 10-Q Note 2): | ||||||||||||||
Basic earnings per common share | $ | 0.47 | $ | 0.41 | $ | 0.06 | 14.6 | |||||||
Diluted earnings per common share | $ | 0.46 | $ | 0.40 | $ | 0.06 | 15.0 | |||||||
AVERAGE EQUIVALENT COMMON SHARES OUTSTANDING (in thousands): | ||||||||||||||
Basic | 135,939 | 129,363 | 6,576 | 5.1 | ||||||||||
Diluted | 137,412 | 131,973 | 5,439 | 4.1 | ||||||||||
DIVIDENDS DECLARED PER COMMON SHARE | $ | 0.36 | $ | 0.35 | $ | 0.01 | 2.9 | |||||||
Effective income tax rate | 33.81 | % | 31.90 | % | ||||||||||
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2015 should be read in conjunction with this financial information.
Page 1
Westar Energy, Inc.
Condensed Consolidated Statements of Income
(Unaudited)
Six Months Ended June 30, | ||||||||||||||
2015 | 2014 | Change | % Change | |||||||||||
(Dollars in Thousands, Except Per Share Amounts) | ||||||||||||||
REVENUES: | ||||||||||||||
Residential | $ | 354,970 | $ | 367,958 | $ | (12,988 | ) | (3.5 | ) | |||||
Commercial | 337,300 | 339,294 | (1,994 | ) | (0.6 | ) | ||||||||
Industrial | 199,630 | 201,480 | (1,850 | ) | (0.9 | ) | ||||||||
Other retail | (7,122 | ) | (11,557 | ) | 4,435 | 38.4 | ||||||||
Total Retail Revenues | 884,778 | 897,175 | (12,397 | ) | (1.4 | ) | ||||||||
Wholesale | 161,584 | 193,047 | (31,463 | ) | (16.3 | ) | ||||||||
Transmission | 119,880 | 125,166 | (5,286 | ) | (4.2 | ) | ||||||||
Other | 14,128 | 25,836 | (11,708 | ) | (45.3 | ) | ||||||||
Total Revenues | 1,180,370 | 1,241,224 | (60,854 | ) | (4.9 | ) | ||||||||
OPERATING EXPENSES: | ||||||||||||||
Fuel and purchased power | 295,561 | 338,618 | (43,057 | ) | (12.7 | ) | ||||||||
SPP network transmission costs | 114,164 | 107,491 | 6,673 | 6.2 | ||||||||||
Operating and maintenance | 167,819 | 193,629 | (25,810 | ) | (13.3 | ) | ||||||||
Depreciation and amortization | 151,345 | 140,992 | 10,353 | 7.3 | ||||||||||
Selling, general and administrative | 119,082 | 118,653 | 429 | 0.4 | ||||||||||
Taxes other than income tax | 75,365 | 69,571 | 5,794 | 8.3 | ||||||||||
Total Operating Expenses | 923,336 | 968,954 | (45,618 | ) | (4.7 | ) | ||||||||
INCOME FROM OPERATIONS | 257,034 | 272,270 | (15,236 | ) | (5.6 | ) | ||||||||
OTHER INCOME (EXPENSE): | ||||||||||||||
Investment earnings | 4,113 | 5,553 | (1,440 | ) | (25.9 | ) | ||||||||
Other income | 17,935 | 11,575 | 6,360 | 54.9 | ||||||||||
Other expense | (8,345 | ) | (7,952 | ) | (393 | ) | (4.9 | ) | ||||||
Total Other Income | 13,703 | 9,176 | 4,527 | 49.3 | ||||||||||
Interest expense | 89,814 | 93,543 | (3,729 | ) | (4.0 | ) | ||||||||
INCOME BEFORE INCOME TAXES | 180,923 | 187,903 | (6,980 | ) | (3.7 | ) | ||||||||
Income tax expense | 61,517 | 61,111 | 406 | 0.7 | ||||||||||
NET INCOME | 119,406 | 126,792 | (7,386 | ) | (5.8 | ) | ||||||||
Less: Net income attributable to noncontrolling interests | 4,716 | 4,365 | 351 | 8.0 | ||||||||||
NET INCOME ATTRIBUTABLE TO WESTAR ENERGY, INC. | $ | 114,690 | $ | 122,427 | $ | (7,737 | ) | (6.3 | ) | |||||
BASIC AND DILUTED EARNINGS PER AVERAGE COMMON SHARE OUTSTANDING ATTRIBUTABLE TO WESTAR ENERGY, INC. (See 10-Q Note 2): | ||||||||||||||
Basic earnings per common share | $ | 0.85 | $ | 0.95 | $ | (0.10 | ) | (10.5 | ) | |||||
Diluted earnings per common share | $ | 0.84 | $ | 0.93 | $ | (0.09 | ) | (9.7 | ) | |||||
AVERAGE EQUIVALENT COMMON SHARES OUTSTANDING (in thousands): | ||||||||||||||
Basic | 134,177 | 129,185 | 4,992 | 3.9 | ||||||||||
Diluted | 136,330 | 131,779 | 4,551 | 3.5 | ||||||||||
DIVIDENDS DECLARED PER COMMON SHARE | $ | 0.72 | $ | 0.70 | $ | 0.02 | 2.9 | |||||||
Effective income tax rate | 34.00 | % | 32.52 | % | ||||||||||
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2015 should be read in conjunction with this financial information.
Page 2
Westar Energy, Inc.
Condensed Consolidated Balance Sheets
(Dollars in Thousands, Except Par Values)
(Unaudited)
June 30, 2015 | December 31, 2014 | ||||||
ASSETS | |||||||
CURRENT ASSETS: | |||||||
Cash and cash equivalents | $ | 2,266 | $ | 4,556 | |||
Accounts receivable, net of allowance for doubtful accounts of $4,569 and $5,309, respectively | 266,330 | 267,327 | |||||
Fuel inventory and supplies | 279,026 | 247,406 | |||||
Deferred tax assets | 20,073 | 29,636 | |||||
Prepaid expenses | 18,147 | 15,793 | |||||
Regulatory assets | 123,961 | 105,549 | |||||
Other | 43,729 | 30,655 | |||||
Total Current Assets | 753,532 | 700,922 | |||||
PROPERTY, PLANT AND EQUIPMENT, NET | 8,340,478 | 8,162,908 | |||||
PROPERTY, PLANT AND EQUIPMENT OF VARIABLE INTEREST ENTITIES, NET | 273,406 | 278,573 | |||||
OTHER ASSETS: | |||||||
Regulatory assets | 726,923 | 754,229 | |||||
Nuclear decommissioning trust | 191,934 | 185,016 | |||||
Other | 261,886 | 265,353 | |||||
Total Other Assets | 1,180,743 | 1,204,598 | |||||
TOTAL ASSETS | $ | 10,548,159 | $ | 10,347,001 | |||
LIABILITIES AND EQUITY | |||||||
CURRENT LIABILITIES: | |||||||
Current maturities of long-term debt of variable interest entities | $ | 28,315 | $ | 27,933 | |||
Short-term debt | 307,100 | 257,600 | |||||
Accounts payable | 185,307 | 219,351 | |||||
Accrued dividends | 49,736 | 44,971 | |||||
Accrued taxes | 87,792 | 74,356 | |||||
Accrued interest | 48,036 | 79,707 | |||||
Regulatory liabilities | 60,860 | 55,142 | |||||
Other | 77,779 | 90,571 | |||||
Total Current Liabilities | 844,925 | 849,631 | |||||
LONG-TERM LIABILITIES: | |||||||
Long-term debt, net | 3,091,655 | 3,215,539 | |||||
Long-term debt of variable interest entities, net | 138,173 | 166,565 | |||||
Deferred income taxes | 1,511,299 | 1,475,487 | |||||
Unamortized investment tax credits | 209,520 | 211,040 | |||||
Regulatory liabilities | 283,451 | 288,343 | |||||
Accrued employee benefits | 524,191 | 532,622 | |||||
Asset retirement obligations | 283,194 | 230,668 | |||||
Other | 77,287 | 75,799 | |||||
Total Long-Term Liabilities | 6,118,770 | 6,196,063 | |||||
COMMITMENTS AND CONTINGENCIES (See 10-Q Notes 10 and 12) | |||||||
EQUITY: | |||||||
Westar Energy, Inc. Shareholders’ Equity: | |||||||
Common stock, par value $5 per share; authorized 275,000,000 shares; issued and outstanding 141,178,618 shares and 131,687,454 shares, respective to each date | 705,893 | 658,437 | |||||
Paid-in capital | 1,997,661 | 1,781,120 | |||||
Retained earnings | 870,820 | 855,299 | |||||
Total Westar Energy, Inc. Shareholders’ Equity | 3,574,374 | 3,294,856 | |||||
Noncontrolling Interests | 10,090 | 6,451 | |||||
Total Equity | 3,584,464 | 3,301,307 | |||||
TOTAL LIABILITIES AND EQUITY | $ | 10,548,159 | $ | 10,347,001 | |||
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2015 should be read in conjunction with this financial information.
Page 3
Westar Energy, Inc.
Condensed Consolidated Statements of Cash Flows
(In Thousands)
(Unaudited)
Six Months Ended June 30, | |||||||
2015 | 2014 | ||||||
CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES: | |||||||
Net income | $ | 119,406 | $ | 126,792 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 151,345 | 140,992 | |||||
Amortization of nuclear fuel | 10,085 | 10,304 | |||||
Amortization of deferred regulatory gain from sale leaseback | (2,748 | ) | (2,748 | ) | |||
Amortization of corporate-owned life insurance | 9,042 | 8,712 | |||||
Non-cash compensation | 4,241 | 3,945 | |||||
Net deferred income taxes and credits | 54,740 | 58,097 | |||||
Stock-based compensation excess tax benefits | (1,178 | ) | 544 | ||||
Allowance for equity funds used during construction | (2,041 | ) | (9,718 | ) | |||
Changes in working capital items: | |||||||
Accounts receivable | 998 | (10,586 | ) | ||||
Fuel inventory and supplies | (31,307 | ) | (16,248 | ) | |||
Prepaid expenses and other | (40,195 | ) | (4,891 | ) | |||
Accounts payable | (2,873 | ) | (16,199 | ) | |||
Accrued taxes | 16,893 | 8,293 | |||||
Other current liabilities | (65,908 | ) | (32,477 | ) | |||
Changes in other assets | (9,712 | ) | 1,828 | ||||
Changes in other liabilities | 21,046 | 16,674 | |||||
Cash Flows from Operating Activities | 231,834 | 283,314 | |||||
CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES: | |||||||
Additions to property, plant and equipment | (334,905 | ) | (427,124 | ) | |||
Purchase of securities - trusts | (9,980 | ) | (4,410 | ) | |||
Sale of securities - trusts | 10,263 | 5,552 | |||||
Investment in corporate-owned life insurance | (14,845 | ) | (15,903 | ) | |||
Proceeds from investment in corporate-owned life insurance | 1,192 | 1,773 | |||||
Investment in affiliated company | — | 1,418 | |||||
Other investing activities | (653 | ) | (1,544 | ) | |||
Cash Flows used in Investing Activities | (348,928 | ) | (440,238 | ) | |||
CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES: | |||||||
Short-term debt, net | 49,500 | 208,533 | |||||
Proceeds from long-term debt | — | 171,785 | |||||
Retirements of long-term debt | (125,000 | ) | (177,500 | ) | |||
Retirements of long-term debt of variable interest entities | (27,925 | ) | (27,305 | ) | |||
Repayment of capital leases | (1,721 | ) | (1,628 | ) | |||
Borrowings against cash surrender value of corporate-owned life insurance | 56,622 | 56,577 | |||||
Repayment of borrowings against cash surrender value of corporate-owned life insurance | (899 | ) | (1,123 | ) | |||
Stock-based compensation excess tax benefits | 1,178 | (544 | ) | ||||
Issuance of common stock | 256,394 | 20,699 | |||||
Distributions to shareholders of noncontrolling interests | (1,076 | ) | — | ||||
Cash dividends paid | (89,035 | ) | (84,419 | ) | |||
Other financing activities | (3,234 | ) | (1,887 | ) | |||
Cash Flows from Financing Activities | 114,804 | 163,188 | |||||
NET CHANGE IN CASH AND CASH EQUIVALENTS | (2,290 | ) | 6,264 | ||||
CASH AND CASH EQUIVALENTS: | |||||||
Beginning of period | 4,556 | 4,487 | |||||
End of period | $ | 2,266 | $ | 10,751 | |||
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2015 should be read in conjunction with this financial information.
Page 4
Westar Energy, Inc.
2nd Quarter 2015 vs. 2014
Earnings Variances | ||||||||||||||
Change | ||||||||||||||
($ per share) | (Dollars in Thousands) | ($ per share) | ||||||||||||
2014 basic earnings attributable to common stock | $ | 53,473 | $ | 0.41 | ||||||||||
Favorable/(Unfavorable) | ||||||||||||||
Retail | (12,654 | ) | A | |||||||||||
Wholesale | (7,606 | ) | B | |||||||||||
Transmission | (2,405 | ) | C | |||||||||||
Other revenues | (440 | ) | ||||||||||||
Fuel and purchased power | 24,699 | D | ||||||||||||
SPP network transmission costs | (1,819 | ) | ||||||||||||
Gross Margin | (225 | ) | ||||||||||||
Operating and maintenance | 19,100 | E | ||||||||||||
Depreciation and amortization | (5,877 | ) | F | |||||||||||
Selling, general and administrative | (1,495 | ) | ||||||||||||
Taxes other than income tax | (2,756 | ) | G | |||||||||||
Other income (expense) | 7,576 | H | ||||||||||||
Interest expense | 1,787 | |||||||||||||
Income tax expense | (7,689 | ) | I | |||||||||||
Net income attributable to noncontrolling interests | (184 | ) | ||||||||||||
Change in shares outstanding | (0.02 | ) | ||||||||||||
2015 basic earnings attributable to common stock | $ | 63,710 | $ | 0.47 | ||||||||||
Major factors influencing the period to period change in EPS -- Favorable/(Unfavorable) | ||||||||||||||
A | Due primarily to mild weather, CDD 3% lower than last year | |||||||||||||
B | Due principally to a 11% decrease in average wholesale prices (see page 7 for changes by customer class) | |||||||||||||
C | Due primarily to estimated refund obligation for transmission revenues -- ($2.6M) | |||||||||||||
D | Due primarily to a decrease in quantity and average price of purchased power | |||||||||||||
E | Due primarily to: lower costs at coal-fired plants primarily due to planned outages -- $11.3M; lower costs for scheduled outage at Wolf Creek in 2014 -- $5.3M | |||||||||||||
F | Due principally to property additions | |||||||||||||
G | Due primarily to higher property tax expense that is largely offset by increased prices -- ($3.0M) | |||||||||||||
H | Due primarily to COLI benefits this year -- $13.8M; partially offset by decrease in equity AFUDC -- ($4.6M) | |||||||||||||
I | Due primarily to higher income before income taxes | |||||||||||||
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2015 should be read in conjunction with this financial information.
Page 5
Westar Energy, Inc.
YTD June 2015 vs. 2014
Earnings Variances | ||||||||||||||
Change | ||||||||||||||
($ per share) | (Dollars in Thousands) | ($ per share) | ||||||||||||
2014 basic earnings attributable to common stock | $ | 122,427 | $ | 0.95 | ||||||||||
Favorable/(Unfavorable) | ||||||||||||||
Retail | (12,397 | ) | A | |||||||||||
Wholesale | (31,463 | ) | B | |||||||||||
Transmission | (5,286 | ) | C | |||||||||||
Other revenues | (11,708 | ) | D | |||||||||||
Fuel and purchased power | 43,057 | E | ||||||||||||
SPP network transmission costs | (6,673 | ) | ||||||||||||
Gross Margin | (24,470 | ) | ||||||||||||
Operating and maintenance | 25,810 | F | ||||||||||||
Depreciation and amortization | (10,353 | ) | G | |||||||||||
Selling, general and administrative | (429 | ) | ||||||||||||
Taxes other than income tax | (5,794 | ) | H | |||||||||||
Other income (expense) | 4,527 | I | ||||||||||||
Interest expense | 3,729 | |||||||||||||
Income tax expense | (406 | ) | ||||||||||||
Net income attributable to noncontrolling interests | (351 | ) | ||||||||||||
Change in shares outstanding | (0.04 | ) | ||||||||||||
2015 basic earnings attributable to common stock | $ | 114,690 | $ | 0.85 | ||||||||||
Major factors influencing the period to period change in EPS -- Favorable/(Unfavorable) | ||||||||||||||
A | Due primarily to mild weather; partially offset by increased average retail prices (see page 8 for changes by customer class) | |||||||||||||
B | Due to a 19% decrease in average wholesale prices (see page 8 for changes by customer class) | |||||||||||||
C | Due primarily to estimated refund obligation for transmission revenues -- ($8.6M) | |||||||||||||
D | Due primarily to lower energy marketing margins reflecting 2014 favorable market conditions -- ($13.1M) | |||||||||||||
E | Due primarily to a 6% decrease in MWh generated, and a 31% decrease in the average cost of purchased MWhs | |||||||||||||
F | Due primarily to: lower costs at coal-fired plants primarily due to planned outages -- $9.7M; lower costs at Wolf Creek principally the result of scheduled outage in 2014 -- $10.9M | |||||||||||||
G | Due principally to property additions | |||||||||||||
H | Due primarily to higher property tax expense that is largely offset by increased prices -- ($5.9M) | |||||||||||||
I | Due primarily to COLI benefits this year -- $13.8M; partially offset by decrease in equity AFUDC -- ($7.7 M) | |||||||||||||
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2015 should be read in conjunction with this financial information.
Page 6
Westar Energy, Inc.
Revenue, Sales and Energy Supply
Supplemental Data | Three Months Ended June 30, | |||||||||||||
2015 | 2014 | Change | % Change | |||||||||||
Revenues | (Dollars In Thousands) | |||||||||||||
Residential | $ | 173,677 | $ | 175,671 | $ | (1,994 | ) | (1.1 | ) | |||||
Commercial | 175,994 | 178,194 | (2,200 | ) | (1.2 | ) | ||||||||
Industrial | 103,151 | 106,984 | (3,833 | ) | (3.6 | ) | ||||||||
Other retail | 3,503 | 3,521 | (18 | ) | (0.5 | ) | ||||||||
Provision for rate refunds | (11,163 | ) | (6,554 | ) | (4,609 | ) | (70.3 | ) | ||||||
Total Retail Revenues | 445,162 | 457,816 | (12,654 | ) | (2.8 | ) | ||||||||
Tariff-based wholesale | 56,688 | 63,976 | (7,288 | ) | (11.4 | ) | ||||||||
Market-based wholesale | 18,140 | 18,458 | (318 | ) | (1.7 | ) | ||||||||
Transmission | 61,295 | 63,700 | (2,405 | ) | (3.8 | ) | ||||||||
Other | 8,278 | 8,718 | (440 | ) | (5.0 | ) | ||||||||
Total Revenues | $ | 589,563 | $ | 612,668 | $ | (23,105 | ) | (3.8 | ) | |||||
Electricity Sales | (Thousands of MWh) | |||||||||||||
Residential | 1,386 | 1,416 | (30 | ) | (2.1 | ) | ||||||||
Commercial | 1,835 | 1,842 | (7 | ) | (0.4 | ) | ||||||||
Industrial | 1,408 | 1,447 | (39 | ) | (2.7 | ) | ||||||||
Other retail | 22 | 21 | 1 | 4.8 | ||||||||||
Total Retail | 4,651 | 4,726 | (75 | ) | (1.6 | ) | ||||||||
Tariff-based wholesale | 1,097 | 1,191 | (94 | ) | (7.9 | ) | ||||||||
Market-based wholesale | 949 | 813 | 136 | 16.7 | ||||||||||
Total wholesale | 2,046 | 2,004 | 42 | 2.1 | ||||||||||
Total Electricity Sales | 6,697 | 6,730 | (33 | ) | (0.5 | ) | ||||||||
(Dollars per MWh) | ||||||||||||||
Total retail | $ | 95.71 | $ | 96.87 | $ | (1.16 | ) | (1.2 | ) | |||||
Tariff-based wholesale | $ | 51.68 | $ | 53.72 | $ | (2.04 | ) | (3.8 | ) | |||||
Market-based wholesale | $ | 19.11 | $ | 22.70 | $ | (3.59 | ) | (15.8 | ) | |||||
Fuel and Purchased Power | (Dollars In Thousands) | |||||||||||||
Fuel used for generation | $ | 106,169 | $ | 115,813 | $ | (9,644 | ) | (8.3 | ) | |||||
Purchased power | 33,514 | 59,071 | (25,557 | ) | (43.3 | ) | ||||||||
Subtotal | 139,683 | 174,884 | (35,201 | ) | (20.1 | ) | ||||||||
RECA recovery and other | 397 | (10,105 | ) | 10,502 | 103.9 | |||||||||
Total fuel and purchased power expense | $ | 140,080 | $ | 164,779 | $ | (24,699 | ) | (15.0 | ) | |||||
Electricity Supply | (Thousands of MWh) | |||||||||||||
Generated - Gas | 237 | 321 | (84 | ) | (26.2 | ) | ||||||||
Coal | 4,542 | 4,459 | 83 | 1.9 | ||||||||||
Nuclear | 756 | 633 | 123 | 19.4 | ||||||||||
Wind | 105 | 116 | (11 | ) | (9.5 | ) | ||||||||
Subtotal electricity generated | 5,640 | 5,529 | 111 | 2.0 | ||||||||||
Purchased | 1,318 | 1,501 | (183 | ) | (12.2 | ) | ||||||||
Total Electricity Supply | 6,958 | 7,030 | (72 | ) | (1.0 | ) | ||||||||
(Dollars per MWh) | ||||||||||||||
Average cost of fuel used for generation | $ | 18.82 | $ | 20.95 | $ | (2.13 | ) | (10.2 | ) | |||||
Average cost of purchased power | $ | 25.43 | $ | 39.35 | $ | (13.92 | ) | (35.4 | ) | |||||
Average cost of fuel and purchased power | $ | 20.08 | $ | 24.88 | $ | (4.80 | ) | (19.3 | ) | |||||
Degree Days | 2014/ | |||||||||||||
2015 | 20 yr Avg | Change | % Change | |||||||||||
Cooling | ||||||||||||||
Actual compared to last year | 537 | 553 | (16 | ) | (2.9 | ) | ||||||||
Actual compared to 20 year average | 537 | 457 | 80 | 17.5 | ||||||||||
Heating | ||||||||||||||
Actual compared to last year | 269 | 392 | (123 | ) | (31.4 | ) | ||||||||
Actual compared to 20 year average | 269 | 385 | (116 | ) | (30.1 | ) | ||||||||
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2015 should be read in conjunction with this financial information.
Page 7
Westar Energy, Inc.
Revenue, Sales and Energy Supply
Supplemental Data | Six Months Ended June 30, | |||||||||||||
2015 | 2014 | Change | % Change | |||||||||||
Revenues | (Dollars In Thousands) | |||||||||||||
Residential | $ | 354,970 | $ | 367,958 | $ | (12,988 | ) | (3.5 | ) | |||||
Commercial | 337,300 | 339,294 | (1,994 | ) | (0.6 | ) | ||||||||
Industrial | 199,630 | 201,480 | (1,850 | ) | (0.9 | ) | ||||||||
Other retail | 7,006 | 6,982 | 24 | 0.3 | ||||||||||
Provision for rate refunds | (14,128 | ) | (18,539 | ) | 4,411 | 23.8 | ||||||||
Total Retail Revenues | 884,778 | 897,175 | (12,397 | ) | (1.4 | ) | ||||||||
Tariff-based wholesale | 117,023 | 131,870 | (14,847 | ) | (11.3 | ) | ||||||||
Market-based wholesale | 44,561 | 61,177 | (16,616 | ) | (27.2 | ) | ||||||||
Transmission | 119,880 | 125,166 | (5,286 | ) | (4.2 | ) | ||||||||
Other | 14,128 | 25,836 | (11,708 | ) | (45.3 | ) | ||||||||
Total Revenues | $ | 1,180,370 | $ | 1,241,224 | $ | (60,854 | ) | (4.9 | ) | |||||
Electricity Sales | (Thousands of MWh) | |||||||||||||
Residential | 2,940 | 3,125 | (185 | ) | (5.9 | ) | ||||||||
Commercial | 3,567 | 3,602 | (35 | ) | (1.0 | ) | ||||||||
Industrial | 2,732 | 2,786 | (54 | ) | (1.9 | ) | ||||||||
Other retail | 41 | 42 | (1 | ) | (2.4 | ) | ||||||||
Total Retail | 9,280 | 9,555 | (275 | ) | (2.9 | ) | ||||||||
Tariff-based wholesale | 2,381 | 2,563 | (182 | ) | (7.1 | ) | ||||||||
Market-based wholesale | 2,236 | 1,918 | 318 | 16.6 | ||||||||||
Total wholesale | 4,617 | 4,481 | 136 | 3.0 | ||||||||||
Total Electricity Sales | 13,897 | 14,036 | (139 | ) | (1.0 | ) | ||||||||
(Dollars per MWh) | ||||||||||||||
Total retail | $ | 95.34 | $ | 93.90 | $ | 1.44 | 1.5 | |||||||
Tariff-based wholesale | $ | 49.15 | $ | 51.45 | $ | (2.30 | ) | (4.5 | ) | |||||
Market-based wholesale | $ | 19.93 | $ | 31.90 | $ | (11.97 | ) | (37.5 | ) | |||||
Fuel and Purchased Power | (Dollars In Thousands) | |||||||||||||
Fuel used for generation | $ | 214,418 | $ | 254,463 | $ | (40,045 | ) | (15.7 | ) | |||||
Purchased power | 79,041 | 98,522 | (19,481 | ) | (19.8 | ) | ||||||||
Subtotal | 293,459 | 352,985 | (59,526 | ) | (16.9 | ) | ||||||||
RECA recovery and other | 2,102 | (14,367 | ) | 16,469 | 114.6 | |||||||||
Total fuel and purchased power expense | $ | 295,561 | $ | 338,618 | $ | (43,057 | ) | (12.7 | ) | |||||
Electricity Supply | (Thousands of MWh) | |||||||||||||
Generated - Gas | 550 | 625 | (75 | ) | (12.0 | ) | ||||||||
Coal | 8,994 | 9,640 | (646 | ) | (6.7 | ) | ||||||||
Nuclear | 1,550 | 1,527 | 23 | 1.5 | ||||||||||
Wind | 211 | 229 | (18 | ) | (7.9 | ) | ||||||||
Subtotal electricity generated | 11,305 | 12,021 | (716 | ) | (6.0 | ) | ||||||||
Purchased | 2,941 | 2,546 | 395 | 15.5 | ||||||||||
Total Electricity Supply | 14,246 | 14,567 | (321 | ) | (2.2 | ) | ||||||||
(Dollars per MWh) | ||||||||||||||
Average cost of fuel used for generation | $ | 18.97 | $ | 21.17 | $ | (2.20 | ) | (10.4 | ) | |||||
Average cost of purchased power | $ | 26.88 | $ | 38.70 | $ | (11.82 | ) | (30.5 | ) | |||||
Average cost of fuel and purchased power | $ | 20.60 | $ | 24.23 | $ | (3.63 | ) | (15.0 | ) | |||||
Degree Days | 2014/ | |||||||||||||
2015 | 20 yr Avg | Change | % Change | |||||||||||
Cooling | ||||||||||||||
Actual compared to last year | 537 | 553 | (16 | ) | (2.9 | ) | ||||||||
Actual compared to 20 year average | 537 | 459 | 78 | 17.0 | ||||||||||
Heating | ||||||||||||||
Actual compared to last year | 2,703 | 3,196 | (493 | ) | (15.4 | ) | ||||||||
Actual compared to 20 year average | 2,703 | 2,814 | (111 | ) | (3.9 | ) | ||||||||
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2015 should be read in conjunction with this financial information.
Page 8
Westar Energy, Inc.
Capitalization | ||||||||||||||
June 30, 2015 | December 31, 2014 | |||||||||||||
(Dollars in Thousands) | ||||||||||||||
Current maturities of long-term debt of VIEs | $ | 28,315 | $ | 27,933 | ||||||||||
Long-term debt, net | 3,091,655 | 3,215,539 | ||||||||||||
Long-term debt of variable interest entities, net | 138,173 | 166,565 | ||||||||||||
Total long-term debt | 3,258,143 | 47.7 | % | 3,410,037 | 50.8 | % | ||||||||
Common equity | 3,574,374 | 52.2 | % | 3,294,856 | 49.1 | % | ||||||||
Noncontrolling interests | 10,090 | 0.1 | % | 6,451 | 0.1 | % | ||||||||
Total capitalization | $ | 6,842,607 | 100.0 | % | $ | 6,711,344 | 100.0 | % | ||||||
GAAP Book value per share | $ | 25.32 | $ | 25.02 | ||||||||||
Period end shares outstanding (in thousands) | 141,179 | 131,687 | ||||||||||||
Outstanding Long-Term Debt | ||||||||||||||
CUSIP | June 30, 2015 | December 31, 2014 | ||||||||||||
Westar Energy: | (Dollars in Thousands) | |||||||||||||
First Mortgage Bond series: | ||||||||||||||
5.15% Series due January 2017 | 95709TAB6 | 125,000 | 125,000 | |||||||||||
8.625% Series due December 2018 | 95709TAG5 | 300,000 | 300,000 | |||||||||||
5.10% Series due July 2020 | 95709TAD2 | 250,000 | 250,000 | |||||||||||
5.95% Series due January 2035 | 95709TAC4 | — | 125,000 | |||||||||||
5.875% Series due July 2036 | 95709TAE0 | 150,000 | 150,000 | |||||||||||
4.125% Series due March 2042 | 95709TAH3 | 550,000 | 550,000 | |||||||||||
4.10% Series due April 2043 | 95709TAJ9 | 430,000 | 430,000 | |||||||||||
4.625% Series due September 2043 | 95709TAK6 | 250,000 | 250,000 | |||||||||||
2,055,000 | 2,180,000 | |||||||||||||
Pollution control bond series: | ||||||||||||||
Variable series due April 2032 (Wamego) | 933623BN9 | 30,500 | 30,500 | |||||||||||
Variable series due April 2032 (St Marys) | 792609AF6 | 45,000 | 45,000 | |||||||||||
75,500 | 75,500 | |||||||||||||
Total Westar Energy | 2,130,500 | 2,255,500 | ||||||||||||
KGE | ||||||||||||||
First mortgage bond series: | ||||||||||||||
6.70%Series due June 2019 | 485260BL6 | 300,000 | 300,000 | |||||||||||
6.15% Series due May 2023 | 485260B@1 | 50,000 | 50,000 | |||||||||||
6.53% Series due December 2037 | 485260BJ1 | 175,000 | 175,000 | |||||||||||
6.64%Series due May 2038 | 485260B#9 | 100,000 | 100,000 | |||||||||||
4.3% Series due July 2044 | 485260BM4 | 250,000 | 250,000 | |||||||||||
875,000 | 875,000 | |||||||||||||
Pollution control bond series: | ||||||||||||||
Variable rate series due April 2027 (LaCygne) | 502828AJ5 | 21,940 | 21,940 | |||||||||||
4.85% Series due June 2031 | 121825CB7 | 50,000 | 50,000 | |||||||||||
Variable rate series due April 2032 (St Marys) | 792609AE9 | 14,500 | 14,500 | |||||||||||
Variable rate series due April 2032 (Wamego) | 933623BM1 | 10,000 | 10,000 | |||||||||||
96,440 | 96,440 | |||||||||||||
Total KGE | 971,440 | 971,440 | ||||||||||||
Total long-term debt | 3,101,940 | 3,226,940 | ||||||||||||
Unamortized debt discount | (10,285 | ) | (11,401 | ) | ||||||||||
Total long-term debt, net | $ | 3,091,655 | $ | 3,215,539 | ||||||||||
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2015 should be read in conjunction with this financial information.
Page 9
Westar Energy, Inc.
GAAP to Non-GAAP Reconciliation
Fuel and purchased power costs fluctuate with electricity sales and unit costs. As permitted by regulators, prices are adjusted to reflect changes in the costs of fuel and purchased power. Fuel and purchased power costs for wholesale customers are recovered at prevailing market prices or based on a predetermined formula with a price adjustment approved by FERC. As a result, changes in fuel and purchased power costs are offset in revenues with minimal impact on net income. For this reason, Westar management believes that gross margin is useful for understanding and analyzing changes in operating performance from one period to the next. Gross margin is calculated as total revenues, including transmission revenues, less the sum of fuel and purchased power costs and amounts billed by the SPP for network transmission costs (SPP NITS). Accordingly, gross margin reflects transmission revenues and costs on a net basis.
The calculations of gross margin for the three and six months ended June 30, 2015 and 2014 are shown in the table below. The table also includes a reconciliation of gross margin to income from operations for both periods. Income from operations is the GAAP financial measure most directly comparable to gross margin.
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||
2015 | 2014 | Change | 2015 | 2014 | Change | ||||||||||||||||||
(Dollars in Thousands) | |||||||||||||||||||||||
Revenues | $ | 589,563 | $ | 612,668 | $ | (23,105 | ) | $ | 1,180,370 | $ | 1,241,224 | $ | (60,854 | ) | |||||||||
Less: Fuel and purchased power expense | 140,080 | 164,779 | (24,699 | ) | 295,561 | 338,618 | (43,057 | ) | |||||||||||||||
SPP network transmission costs | 57,352 | 55,533 | 1,819 | 114,164 | 107,491 | 6,673 | |||||||||||||||||
Gross Margin | $ | 392,131 | $ | 392,356 | $ | (225 | ) | $ | 770,645 | $ | 795,115 | $ | (24,470 | ) | |||||||||
Gross margin | $ | 392,131 | $ | 392,356 | $ | (225 | ) | $ | 770,645 | $ | 795,115 | $ | (24,470 | ) | |||||||||
Less: Operating and maintenance expense | 82,739 | 101,839 | (19,100 | ) | 167,819 | 193,629 | (25,810 | ) | |||||||||||||||
Depreciation and amortization expense | 76,759 | 70,882 | 5,877 | 151,345 | 140,992 | 10,353 | |||||||||||||||||
Selling, general and administrative expense | 63,663 | 62,168 | 1,495 | 119,082 | 118,653 | 429 | |||||||||||||||||
Taxes other than income tax | 37,494 | 34,738 | 2,756 | 75,365 | 69,571 | 5,794 | |||||||||||||||||
Income from operations | $ | 131,476 | $ | 122,729 | $ | 8,747 | $ | 257,034 | $ | 272,270 | $ | (15,236 | ) | ||||||||||
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2015 should be read in conjunction with this financial information.
Page 10