NiSource Reports First Quarter 2010 Results of 72 Cents Per Share
MERRILLVILLE, Ind., May 4 /PRNewswire-FirstCall/ —
- Results in line with 2010 net operating earnings guidance
- Business initiatives, capital investments continue to advance
NiSource Inc. (NYSE: NI) today announced net operating earnings from continuing operations (non-GAAP) of $198.3 million, or 72 cents per share, for the three months ended March 31, 2010, compared to $170.4 million, or 62 cents per share, for the first quarter of 2009. Operating earnings for the quarter (non-GAAP) were $404.9 million, compared to $369.6 million for the same period in 2009.
On a GAAP basis, NiSource reported income from continuing operations for the three months ended March 31, 2010, of $197.3 million, or 71 cents per share, compared with $159.4 million, or 58 cents per share, in the same period a year ago. Operating income was $403.2 million for the first quarter of 2010, compared with $348.4 million in the year-ago period. Schedules 1 and 2 of this news release contain a reconciliation of net operating earnings and operating earnings to GAAP.
“We continue to see solid results from NiSource’s low-risk, investment-driven strategy for meeting the needs of our customers while generating long-term, sustainable earnings growth and increased shareholder value,” President and Chief Executive Officer Robert C. Skaggs, Jr. said. “Our first quarter performance is squarely in line with our 2010 earnings outlook and reflects our balanced plan of synchronizing infrastructure investments with complementary regulatory and commercial activities.”
Skaggs also noted that the company’s first quarter results reflected a modest uptick in industrial and residential demand in Indiana partially attributable to economic recovery. “Although it is too early to identify a definitive trend, we continue to see a gradual and modest pace of economic recovery across the markets served by our utilities,” Skaggs noted.
Skaggs also highlighted steady progress on NiSource’s key business priorities, including the advancement of customer service, reliability, and regulatory initiatives at Northern Indiana Public Service Company (NIPSCO), development of an array of natural gas transmission and storage growth opportunities linked to NiSource’s extensive asset footprint in the Marcellus Shale region of Appalachia, and advancing infrastructure and regulatory programs at the company’s natural gas utilities.
Indiana customer, reliability, and regulatory initiatives advance
NiSource’s Indiana utilities are focused on a number of initiatives to enhance customer service and reliability, modernize rate structures, and position the company for future growth.
In February, Jimmy D. Staton, group CEO of NiSource’s gas distribution businesses, assumed the added responsibility for the company’s Indiana gas and electric utility businesses. Staton has considerable experience in the electric industry and has successfully implemented a broad range of regulatory and customer initiatives. Under his direction, the company is executing an aggressive 2010 business and regulatory agenda, including:
- Investing more than $200 million during 2010 in NIPSCO’s generation fleet and service infrastructure to continue providing reliable, environmentally compliant, and affordable energy to its northern Indiana customers.
- Taking steps to broaden customer programs and reform rate structures. On May 3, NIPSCO filed a natural gas rate case with the Indiana Utility Regulatory Commission (IURC) proposing extension of popular energy-efficiency programs for customers, as well as a change in rate design. New rates, reflecting a modest impact on customer bills, are targeted to be effective by early 2011 or sooner.
- Developing new and enhanced energy-efficiency and customer-assistance programs for NIPSCO’s electric customers and updating rates. The company plans to include several new customer program proposals in its next electric base rate case, expected to be filed in the third quarter of 2010. That filing also will propose to update base rates to reflect recent demand levels, investments and expenses, with new rates expected to be effective in the second half of 2011.
- NIPSCO’s 2008 electric rate case remains pending before the IURC, with a decision in the case expected within the next few months.
“This is a pivotal year for NIPSCO as we continue to position the company for long-term growth while providing our customers with the tools to conserve energy and to manage through the current economic cycle,” Skaggs said. “Executing our Indiana business and regulatory agenda requires a solid strategy, strong collaboration with all of our key stakeholders, and committed leadership. While it will certainly take time and a considerable amount of effort by the team, I believe we have the ingredients in place to deliver on that challenge.”
Executing on Marcellus-driven growth in transmission & storage
NiSource’s Gas Transmission & Storage (NGT&S) Operations continues to identify and advance a number of near-term, low-risk growth projects that leverage its geographic footprint throughout the Marcellus Shale production areas.
- The company’s Cobb Compressor Station expansion project will help meet natural gas producers’ near-term transportation needs in the Appalachian Basin, with agreements in place for more than 25,000 dekatherms per day of long-term, firm transportation service. The project is expected to be in service during the second quarter of 2010.
- Work is continuing on three incremental growth projects associated with NGT&S assets in the Majorsville region of southwestern Pennsylvania – a prime location for Marcellus-related production activities. The projects, which are scheduled to begin service during the third quarter of 2010, entail more than $80 million of investment and will aggregate Marcellus gas production for downstream transmission with a total capacity of 325,000 dekatherms per day.
- In addition, NGT&S is developing an extensive portfolio of infrastructure growth projects in the Marcellus area designed to meet the needs of the market and deliver attractive returns on invested capital.
“Exploiting our competitive advantage is the focus of our growth project development activity at NGT&S, given our strategic footprint throughout one of the nation’s largest shale production areas,” Skaggs said. “Our core assets are in one of the Marcellus ‘sweet spots,’ and we have a broad range of opportunities for low-risk, strong return investments targeting the needs of our diverse customer base.”
Gas Distribution progress continues
NiSource’s Gas Distribution Operations continue to deliver strong results from its strategy of aligning infrastructure replacement and enhancement programs with a variety of regulatory and rate-design initiatives. Highlights include:
- On Jan. 28, Columbia Gas of Pennsylvania filed a base rate increase request with the Pennsylvania Public Utility Commission. In addition to proposing new residential home energy efficiency programs and the implementation of a more progressive rate design, the company is seeking an increase in its base rates of approximately $32 million annually. New rates are expected to be placed into effect in the fourth quarter of 2010.
- First quarter results were positively affected by the late-2009 approval of a Bay State Gas Co. rate case by the Massachusetts Department of Public Utilities (DPU). The new rates, which increased annual base revenues by approximately $19 million, took effect on Nov. 1, 2009. Notably, the DPU approved a decoupled rate design for Bay State, as well as the company’s proposed infrastructure replacement tracking mechanism.
- On Jan. 28, Columbia Gas of Maryland filed a base rate adjustment request of $2.2 million with the Maryland Public Service Commission. New rates are expected to be placed into effect in the fourth quarter of 2010.
- During the quarter, Columbia Gas of Virginia (CGV) initiated its Conservation and Ratemaking Efficiency (CARE) Plan, which established a decoupled rate mechanism together with certain customer efficiency programs. Also during the quarter, legislation was enacted in Virginia which affords gas utilities the opportunity for accelerated recovery for certain infrastructure investments – a significant, positive development for CGV and its customers. Finally, on May 3, the company filed a rate case with the Virginia State Corporation Commission to establish customer rates to be effective at the conclusion of a four-year rate settlement, set to expire on Dec. 31. The filing proposes an increase in annual base revenues of $13 million.
“Our customers and investors are experiencing current and ongoing benefits from our gas distribution team’s commercial, regulatory and infrastructure initiatives,” Skaggs said. “The introduction and deployment of innovative customer programs in tandem with long-term low-risk, infrastructure-replacement programs create an unparalleled platform for long-term, sustainable growth.”
2010 guidance, growth outlook reaffirmed
Skaggs noted that NiSource’s earnings outlook remains consistent with the company’s previously announced net operating earnings guidance for 2010.
“We remain on track to deliver on our key business priorities – advancing the next wave of Marcellus Shale growth projects, continuing to execute our infrastructure replacement programs and related regulatory initiatives, and completing the NIPSCO repositioning process,” Skaggs said.
Skaggs reiterated that NiSource expects its earnings to grow by 3 to 5 percent on a long-term basis. For 2010, net operating earnings (non-GAAP) are projected to fall within a range of $1.10 to $1.20 per share. As outlined in last quarter’s earnings release, due to the unpredictability of weather and other factors, the company is not providing GAAP earnings guidance.
Skaggs also noted that NiSource’s liquidity position remains strong following a series of initiatives taken in 2009 to address the company’s long-term financing needs through 2011. The company also is on track to make capital expenditures of approximately $900 million in 2010, an increase of approximately $100 million, or 12.5 percent, over its 2009 program.
First Quarter 2010 Operating Earnings – Segment Results (non-GAAP)
NiSource’s consolidated operating earnings (non-GAAP) for the quarter ended March 31, 2010, were $404.9 million, compared to $369.6 million in the first quarter of 2009. Refer to Schedule 2 for the items included in 2010 and 2009 GAAP operating income but excluded from operating earnings.
Operating earnings for NiSource’s business segments for the quarter ended March 31, 2010 are discussed below.
Gas Distribution Operations reported operating earnings for the current quarter of $234.7 million compared to $237.3 million in the first quarter of 2009. Net revenues, excluding the impact of trackers, decreased by $15.5 million, primarily attributable to Columbia Gas of Ohio’s change from a volumetrically based rate design to one based on fixed monthly charges for certain customer classes. The revenue variance experienced in the first quarter will be offset throughout the balance of the year. The decrease in net revenues was partially offset by increases in other regulatory and service programs, including impacts from rate cases at various utilities.
Operating expenses, excluding trackers, were $12.9 million lower than the comparable 2009 period, reflecting lower employee and administrative costs, other taxes, and environmental related expenses. The lower employee and administrative costs were primarily due to decreases in pension and other post-retirement expenses, including the deferral of pension costs and other post-retirement expenses for Columbia Gas of Ohio.
Gas Transmission and Storage Operations reported operating earnings for the current quarter of $125.9 million compared to $111.1 million in the first quarter of 2009. Net revenues, excluding the impact of trackers, increased by $14.3 million, primarily attributable to increases in firm capacity reservation fees from growth projects such as the Eastern Market Expansion and the Ohio Storage Expansion, as well as new Appalachian production transportation contracts. Net revenues were also favorably impacted by the recognition of a gain on the transfer of native gas provided by Columbia Transmission to Hardy Storage Company (Hardy).
Operating expenses, excluding the impact of trackers, remained essentially unchanged compared to the first quarter of 2009.
Electric Operations reported operating earnings for the current quarter of $46.2 million compared to $26.1 million in the first quarter of 2009. Net revenues, excluding the impact of trackers, increased by $15.3 million, attributable to increased industrial and residential customer margins.
Operating expenses decreased by $4.8 million, excluding trackers, primarily attributable to lower employee, administrative, and electric generation costs. The lower employee and administrative costs were primarily due to decreases in pension and other post-retirement expenses. The decrease in operating expenses was partially offset by an increase in environmental expenses primarily related to the impact of a favorable insurance settlement recorded during the first quarter of 2009.
Corporate and Other Operations reported an operating earnings loss of $1.9 million for the current quarter compared to a loss of $4.9 million in the first quarter of 2009. In the first quarter of 2010, management eliminated the “Other” segment. NiSource’s decision to wind down the unregulated natural gas marketing activities will impact the results from Other Operations. Results previously recorded as “Other” are now included within “Corporate and Other Operations.”
Interest expense increased by $8.3 million due to incremental interest expense associated with the issuance of $600 million of long-term debt in March of 2009 and $500 million of long-term debt in December of 2009, partially offset by the $250.6 million tender offer debt repurchase in April 2009 and the floating rate maturity in November 2009, coupled with lower short-term borrowings and interest rates.
Other-net income of $2.6 million was recorded in 2010 compared to a loss of $4.2 million for 2009 as a result of favorable AFUDC rates, an increase in interest income, and lower costs related to the sale of accounts receivables. The effective tax rate of net operating earnings was 35.8 percent compared to 38.0 percent for the same period last year.
About NiSource
NiSource Inc. (NYSE: NI), based in Merrillville, Ind., is a Fortune 500 company engaged in natural gas transmission, storage and distribution, as well as electric generation, transmission and distribution. NiSource operating companies deliver energy to 3.8 million customers located within the high-demand energy corridor stretching from the Gulf Coast through the Midwest to New England. Information about NiSource and its subsidiaries is available via the Internet at www.nisource.com. NI-F
Forward-Looking Statements
This news release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Those statements include statements regarding the intent, belief or current expectations of NiSource and its management. Although NiSource believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved. Readers are cautioned that the forward-looking statements in this news release are not guarantees of future performance and involve a number of risks and uncertainties, and that actual results could differ materially from those indicated by such forward-looking statements. Important factors that could cause actual results to differ materially from those indicated by such forward-looking statements include, but are not limited to, the following: weather; fluctuations in supply and demand for energy commodities; growth opportunities for NiSource’s businesses; increased competition in deregulated energy markets; the success of regulatory and commercial initiatives; dealings with third parties over whom NiSource has no control; actual operating experience of NiSource’s assets; the regulatory process; regulatory and legislative changes; the impact of potential new environmental laws or regulations; the results of material litigation; changes in pension funding requirements; changes in general economic, capital and commodity market conditions; and counter-party credit risk, and the matters set forth in the “Risk Factors” section in NiSource’s 2009 Form 10-K, many of which risks are beyond the control of NiSource. NiSource expressly disclaims a duty to update any of the forward-looking statements contained in this release.
NiSource Inc.
Consolidated Net Operating Earnings (Non - GAAP)
(unaudited)
Three Months
Ended March 31,
---------------
(in millions, except per share amounts) 2010 2009
--------------------------------------- ---- ----
Net Revenues
Gas Distribution $1,340.3 $1,710.4
Gas Transportation and Storage 370.4 396.2
Electric 318.3 305.4
Other 21.6 14.8
----- ---- ----
Gross Revenues 2,050.6 2,426.8
Cost of Sales (excluding depreciation and
amortization) 981.0 1,361.9
----------------------------------------- ----- -------
Total Net Revenues 1,069.6 1,064.9
------------------ ------- -------
Operating Expenses
Operation and maintenance 329.5 349.1
Operation and maintenance - trackers 107.1 107.0
Depreciation and amortization 147.3 141.8
Depreciation and amortization - trackers 2.5 1.8
Other taxes 54.7 61.7
Other taxes - trackers 31.0 40.3
---------------------- ---- ----
Total Operating Expenses 672.1 701.7
------------------------ ----- -----
Equity Earnings in Unconsolidated Affiliates 7.4 6.4
-------------------------------------------- --- ---
Operating Earnings 404.9 369.6
------------------ ----- -----
Other Income (Deductions)
Interest expense, net (98.7) (90.4)
Other, net 2.6 (4.2)
---------- --- ----
Total Other Income (Deductions) (96.1) (94.6)
------------------------------- ----- -----
Operating Earnings From Continuing Operations
Before Income Taxes 308.8 275.0
Income Taxes 110.5 104.6
Net Operating Earnings from Continuing
Operations 198.3 170.4
--------------------------------------- ----- -----
GAAP Adjustment (1.0) (11.0)
---- -----
GAAP Income from Continuing Operations $197.3 $159.4
====================================== ====== ======
Basic Net Operating Earnings Per Share from
Continuing Operations 0.72 0.62
------------------------------------------- ---- ----
GAAP Basic Earnings Per Share from Continuing
Operations 0.71 0.58
--------------------------------------------- ---- ----
Basic Average Common Shares Outstanding 276.9 274.2
--------------------------------------- ----- -----
NiSource Inc.
Segment Operating Earnings (Non-GAAP)
Three Months
Gas Distribution Operations Ended March 31,
---------------
(in millions) 2010 2009
------------- ---- ----
Net Revenues
Sales revenues $1,550.4 $1,948.8
Less: Cost of gas sold 942.0 1,314.8
---------------------- ----- -------
Net Revenues 608.4 634.0
------------ ----- -----
Operating Expenses
Operation and maintenance 167.6 177.7
Operation and maintenance -
trackers 90.2 91.0
Depreciation and amortization 62.5 60.4
Other taxes 22.4 27.3
Other taxes - trackers 31.0 40.3
---------------------- ---- ----
Total Operating Expenses 373.7 396.7
------------------------ ----- -----
Operating Earnings $234.7 $237.3
================== ====== ======
GAAP Adjustment 0.4 5.9
--------------- --- ---
GAAP Operating Income $235.1 $243.2
===================== ====== ======
Three Months
Gas Transmission and Storage
Operations Ended March 31,
---------------
(in millions) 2010 2009
------------- ---- ----
Net Revenues
Transportation revenues $197.2 $194.5
Storage revenues 49.4 45.2
Other revenues 10.0 2.6
-------------- ---- ---
Net Operating Revenues 256.6 242.3
---------------------- ----- -----
Operating Expenses
Operation and maintenance 76.6 77.2
Operation and maintenance -
trackers 15.1 15.1
Depreciation and amortization 31.5 29.4
Other taxes 14.9 15.9
----------- ---- ----
Total Operating Expenses 138.1 137.6
------------------------ ----- -----
Equity Earnings in Unconsolidated
Affiliates 7.4 6.4
--------------------------------- --- ---
Operating Earnings $125.9 $111.1
================== ====== ======
GAAP Adjustment - (18.2)
--- -----
GAAP Operating Income $125.9 $92.9
===================== ====== =====
NiSource Inc.
Segment Operating Earnings (Non-GAAP)
Three Months
Ended March
Electric Operations 31,
------------
(in millions) 2010 2009
------------- ---- ----
Net Revenues
Sales revenues $320.4 $307.0
Less: Cost of sales 116.6 120.0
------------------- ----- -----
Net Revenues 203.8 187.0
------------ ----- -----
Operating Expenses
Operation and maintenance 88.9 93.7
Operation and maintenance -
trackers 1.7 0.9
Depreciation and
amortization 49.8 48.6
Depreciation and
amortization -trackers 2.5 1.8
Other taxes 14.7 15.9
----------- ---- ----
Total Operating Expenses 157.6 160.9
------------------------ ----- -----
Operating Earnings $46.2 $26.1
================== ===== =====
GAAP Adjustment (1.1) (8.8)
--------------- ---- ----
GAAP Operating Income $45.1 $17.3
===================== ===== =====
Three Months
Corporate and Other Ended March
Operations 31,
------------
(in millions) 2010 2009
-------------------- ---- ----
Operating Earnings (Loss) $(1.9) $(4.9)
========================= ===== =====
GAAP Adjustment (1.0) (0.1)
---- ----
GAAP Operating Income (Loss) $(2.9) $(5.0)
============================ ===== =====
NiSource Inc.
Segment Volumes and Statistical Data
Three Months
Gas Distribution Operations Ended March 31,
---------------
2010 2009
---- ----
Sales and Transportation (MMDth)
Residential 129.4 132.6
Commercial 72.8 78.0
Industrial 100.9 96.6
Off System 15.9 16.2
Other 0.5 0.3
----- --- ---
Total 319.5 323.7
----- ----- -----
Weather Adjustment 0.3 (3.6)
------------------ --- ----
Sales and Transportation Volumes -
Excluding Weather 319.8 320.1
================================== ===== =====
Heating Degree Days 2,890 2,950
Normal Heating Degree Days 2,900 2,900
% Colder than Normal - 2%
Customers
Residential 3,045,246 3,041,969
Commercial 280,207 280,595
Industrial 7,855 7,964
Other 80 80
----- --- ---
Total 3,333,388 3,330,608
----- --------- ---------
Three Months
Gas Transmission and Storage
Operations Ended March 31,
---------------
2010 2009
---- ----
Throughput (MMDth)
Columbia Transmission 387.5 408.4
Columbia Gulf 202.9 269.1
Crossroads Gas Pipeline 8.1 8.6
Intrasegment eliminations (139.0) (172.2)
Total 459.5 513.9
----- ----- -----
NiSource Inc.
Segment Volumes and Statistical Data (continued)
Three Months
Ended March
Electric Operations 31,
------------
2010 2009
---- ----
Sales (Gigawatt Hours)
Residential 847.0 842.8
Commercial 935.3 968.6
Industrial 2,030.8 1,989.0
Wholesale 133.4 57.6
Other 41.4 35.1
----- ---- ----
Total 3,987.9 3,893.1
----- ------- -------
Weather Adjustment 5.4 (6.0)
------------------ --- ----
Sales Volumes -Excluding
Weather impacts 3,993.3 3,887.1
======================== ======= =======
Electric Customers
Residential 400,079 399,334
Commercial 53,611 53,349
Industrial 2,439 2,471
Wholesale 15 8
Other 743 752
----- --- ---
Total 456,887 455,914
----- ------- -------
NiSource Inc.
Schedule 1 -Reconciliation of Net Operating Earnings to GAAP
Three Months
Ended March
31,
------------
(in millions, except per share amounts) 2010 2009
--------------------------------------- ---- ----
Net Operating Earnings from Continuing
Operations (Non-GAAP) $198.3 $170.4
-------------------------------------- ------ ------
Items excluded from operating earnings:
Net Revenues:
Weather - compared to normal 0.4 6.9
Revenue adjustment - (9.0)
Unregulated natural gas marketing
business 2.0 3.4
Operating Expenses:
Restructuring (1.0) (19.8)
Transition charges (IBM Agreement) - (1.2)
Unregulated natural gas marketing
business (3.0) (3.5)
Gain/Loss on sale of assets and
asset impairments (0.1) 2.0
Total items excluded from operating
earnings (1.7) (21.2)
----------------------------------- ---- -----
Gain on early extinguishment of
debt - 3.2
-------------------------------- --- ---
Tax effect of above items and other
income tax adjustments 0.7 7.0
----------------------------------- --- ---
Total items excluded from net
operating earnings (1.0) (11.0)
----------------------------- ---- -----
Reported Income from Continuing
Operations -GAAP $197.3 $159.4
=============================== ====== ======
Basic Average Common Shares Outstanding 276.9 274.2
----- -----
Basic Net Operating Earnings Per Share
from Continuing Operations ($) 0.72 0.62
-------------------------------------- ---- ----
Items excluded from net operating
earnings (after-tax) (0.01) (0.04)
--------------------------------- ----- -----
GAAP Basic Earnings Per Share from
Continuing Operations 0.71 0.58
---------------------------------- ---- ----
NiSource Inc.
Schedule 2 - Adjustments by Segment from
Operating Earnings to GAAP
For Quarter Ended March 31,
2010 (in millions)
Gas
Transmission
Gas and Corporate
Distribution Storage Electric & Other Total
------------ ------------ -------- --------- -----
Operating
Earnings
(Loss) $234.7 $125.9 $46.2 $(1.9) $404.9
Net Revenues:
Weather
(compared to
normal) 0.8 - (0.4) - 0.4
Unregulated
natural gas
marketing
business - - - 2.0 2.0
--- --- --- --- ---
Total Impact -
Net Revenues 0.8 - (0.4) 2.0 2.4
Operating
Expenses
Restructuring (0.3) - (0.7) - (1.0)
Unregulated
natural gas
marketing
business - - - (3.0) (3.0)
Loss on sale
of assets and
asset
impairments (0.1) - - - (0.1)
---- --- --- --- ----
Total Impact -
Operating
Expenses (0.4) - (0.7) (3.0) (4.1)
Total Impact -
Operating
Income (Loss) $0.4 $- $(1.1) $(1.0) $(1.7)
---- --- ----- ----- -----
Operating
Income (Loss)
-GAAP $235.1 $125.9 $45.1 $(2.9) $403.2
------ ------ ----- ----- ------
2009 (in millions)
Gas
Transmission
Gas and Corporate
Distribution Storage Electric & Other Total
------------ ------------ -------- --------- -----
Operating
Earnings
(Loss) $237.3 $111.1 $26.1 $(4.9) $369.6
Net
Revenues:
Weather
(compared
to normal) 6.5 - 0.4 - 6.9
Revenue
adjustment - - (9.0) - (9.0)
Unregulated
natural gas
marketing
business - - - 3.4 3.4
--- --- --- --- ---
Total Impact
-Net
Revenues 6.5 - (8.6) 3.4 1.3
Operating
Expenses
Transition
charges (0.6) (0.4) (0.2) - (1.2)
Restructuring - (19.8) - - (19.8)
Unregulated
natural gas
marketing
business - - - (3.5) (3.5)
Gain on sale
of assets
and asset
impairments - 2.0 - - 2.0
--- --- --- --- ---
Total Impact
-O & M
Expenses (0.6) (18.2) (0.2) (3.5) (22.5)
Total Impact
-Operating
Income
(Loss) $5.9 $(18.2) $(8.8) $(0.1) $(21.2)
---- ------ ----- ----- ------
Operating
Income
(Loss) -
GAAP $243.2 $92.9 $17.3 $(5.0) $348.4
------ ----- ----- ----- ------
NiSource Inc.
Consolidated Income Statements (GAAP)
(unaudited)
Three Months
Ended March 31,
---------------
(in millions, except per share amounts) 2010 2009
--------------------------------------- ---- ----
Net Revenues
Gas Distribution $1,341.1 $1,716.9
Gas Transportation and Storage 370.4 396.2
Electric 317.9 296.8
Other 328.9 311.8
----- ----- -----
Gross Revenues 2,358.3 2,721.7
Cost of Sales (excluding depreciation and
amortization) 1,286.3 1,655.5
----------------------------------------- ------- -------
Total Net Revenues 1,072.0 1,066.2
------------------ ------- -------
Operating Expenses
Operation and maintenance 439.4 479.1
Depreciation and amortization 149.8 143.7
Impairment and loss/(gain) on sale of
assets, net 0.1 (2.0)
Other taxes 86.9 103.4
----------- ---- -----
Total Operating Expenses 676.2 724.2
------------------------ ----- -----
Equity Earnings in Unconsolidated
Affiliates 7.4 6.4
--------------------------------- ---
Operating Income 403.2 348.4
---------------- ----- -----
Other Income (Deductions)
Interest expense, net (98.7) (90.4)
Gain on early extinguishment of long-term
debt - 3.2
Other, net 2.6 (4.2)
---------- --- ----
Total Other Income (Deductions) (96.1) (91.4)
------------------------------- ----- -----
Income From Continuing Operations Before
Income Taxes 307.1 257.0
Income Taxes 109.8 97.6
------------ ----- ----
Income from Continuing Operations 197.3 159.4
--------------------------------- ----- -----
Loss from Discontinued Operations -net of
taxes (0.1) (10.8)
Gain (Loss) on Disposition of Discontinued
Operations -net of taxes 0.1 (0.2)
------------------------------------------ --- ----
Net Income $197.3 $148.4
========== ====== ======
Basic Earnings (Loss) Per Share
Continuing operations $0.71 $0.58
Discontinued operations - (0.04)
----------------------- --- -----
Basic Earnings Per Share $0.71 $0.54
----- -----
Diluted Earnings (Loss) Per Share
Continuing operations $0.71 $0.58
Discontinued operations - (0.04)
----------------------- --- -----
Diluted Earnings Per Share $0.71 $0.54
----- -----
Dividends Declared Per Common Share $0.46 $0.46
----- -----
Basic Average Common Shares Outstanding 276.9 274.2
Diluted Average Common Shares 277.5 276.7
----------------------------- ----- -----
NiSource Inc.
Consolidated Balance Sheets (GAAP)
(unaudited)
March December
31, 31,
(in millions) 2010 2009
------------- ---- ----
ASSETS
Property, Plant and Equipment
Utility Plant $19,049.3 $18,946.1
Accumulated depreciation and amortization (8,443.5) (8,353.7)
----------------------------------------- -------- --------
Net utility plant 10,605.8 10,592.4
----------------- -------- --------
Other property, at cost, less accumulated
depreciation 91.4 91.5
----------------------------------------- ---- ----
Net Property, Plant and Equipment 10,697.2 10,683.9
--------------------------------- -------- --------
Investments and Other Assets
Assets of discontinued operations and assets
held for sale 12.9 18.7
Unconsolidated affiliates 166.8 165.8
Other investments 129.1 129.2
----------------- ----- -----
Total Investments and Other Assets 308.8 313.7
---------------------------------- ----- -----
Current Assets
Cash and cash equivalents 110.6 16.4
Restricted cash 220.8 174.7
Accounts receivable (less reserve of $68.6
and $39.6, respectively) 949.9 808.6
Income tax receivable 2.9 24.9
Gas inventory 79.0 384.8
Underrecovered gas and fuel costs 114.4 40.2
Materials and supplies, at average cost 98.5 102.3
Electric production fuel, at average cost 52.4 59.9
Price risk management assets 190.4 173.3
Exchange gas receivable 71.3 72.5
Regulatory assets 169.6 238.3
Assets of discontinued operations and assets
held for sale 0.7 2.2
Prepayments and other 136.7 125.5
--------------------- ----- -----
Total Current Assets 2,197.2 2,223.6
-------------------- ------- -------
Other Assets
Price risk management assets 271.3 237.6
Regulatory assets 1,720.0 1,644.1
Goodwill 3,677.3 3,677.3
Intangible assets 316.8 319.6
Postretirement and postemployment benefits
assets 22.8 19.8
Deferred charges and other 140.2 152.1
-------------------------- ----- -----
Total Other Assets 6,148.4 6,050.5
------------------ ------- -------
Total Assets $19,351.6 $19,271.7
============ ========= =========
NiSource Inc.
Consolidated Balance Sheets (continued) (GAAP)
(unaudited)
December
March 31, 31,
(in millions, except share amounts) 2010 2009
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CAPITALIZATION AND LIABILITIES
Capitalization
Common Stockholders' Equity
Common stock -$0.01 par value, 400,000,000 shares
authorized; 277,290,886
and 276,638,021 shares issued and outstanding,
respectively $2.8 $2.8
Additional paid-in capital 4,068.5 4,057.6
Retained earnings 935.3 865.5
Accumulated other comprehensive loss (50.4) (45.9)
Treasury stock (27.4) (25.9)
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Total Common Stockholders' Equity 4,928.8 4,854.1
Long-term debt, excluding amounts due within one
year 5,963.9 5,965.1
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Total Capitalization 10,892.7 10,819.2
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Current Liabilities
Current portion of long-term debt 723.1 719.3
Short-term borrowings 370.7 103.0
Accounts payable 407.1 502.1
Dividends declared 64.0 0.2
Customer deposits and accounts receivable credit
balances 176.5 301.2
Taxes accrued 296.8 212.9
Interest accrued 84.1 125.4
Overrecovered gas and fuel costs 43.5 220.4
Price risk management liabilities 211.1 190.1
Exchange gas payable 151.4 222.2
Deferred revenue 11.5 27.3
Regulatory liabilities 51.7 43.8
Accrued liability for postretirement and
postemployment benefits 7.6 23.6
Liabilities of discontinued operations and
liabilities held for sale 0.9 1.7
Temporary LIFO liquidation credit 42.2 -
Legal and environmental reserves 97.5 146.1
Other accruals 257.5 310.3
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Total Current Liabilities 2,997.2 3,149.6
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Other Liabilities and Deferred Credits
Price risk management liabilities 200.6 170.2
Deferred income taxes 2,053.3 2,018.2
Deferred investment tax credits 38.1 39.6
Deferred credits 71.9 72.4
Deferred revenue 9.0 8.5
Accrued liability for postretirement and
postemployment benefits 1,190.8 1,134.2
Liabilities of discontinued operations and
liabilities held for sale 3.9 10.2
Regulatory liabilities and other removal costs 1,571.4 1,558.8
Asset retirement obligations 139.7 138.2
Other noncurrent liabilities 183.0 152.6
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Total Other Liabilities and Deferred Credits 5,461.7 5,302.9
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Commitments and Contingencies - -
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Total Capitalization and Liabilities $19,351.6 $19,271.7
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NiSource Inc.
Statements of Consolidated Cash Flows (GAAP)
(unaudited)
Three Months Ended March 31, (in millions) 2010 2009
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Operating Activities
Net Income $197.3 $148.4
Adjustments to Reconcile Net Income to Net Cash
from Continuing Operations:
Gain on Early Extinguishment of Debt - (3.2)
Depreciation and Amortization 149.8 143.7
Net Changes in Price Risk Management Assets and
Liabilities (7.4) (1.7)
Deferred Income Taxes and Investment Tax Credits 27.2 23.1
Deferred Revenue (15.8) (3.7)
Stock Compensation Expense 2.2 1.6
Gain on Sale of Assets (0.1) (2.0)
Income from Unconsolidated Affiliates (7.4) (6.4)
(Gain) Loss on Disposition of Discontinued
Operations -Net of Taxes (0.1) 0.2
Loss from Discontinued Operations -Net of Taxes 0.1 10.8
Amortization of Discount/Premium on Debt 2.7 2.1
AFUDC Equity (1.4) 0.9
Changes in Assets and Liabilities:
Accounts Receivable (138.4) 172.0
Income Tax Receivable 22.1 -
Inventories 332.7 487.7
Accounts Payable (103.0) (161.0)
Customer Deposits and Credits (124.7) (114.6)
Taxes Accrued 96.4 81.9
Interest Accrued (38.9) (23.4)
(Under) Overrecovered Gas and Fuel Costs (251.1) 446.3
Exchange Gas Receivable/Payable (66.7) (80.1)
Other Accruals (17.2) (69.3)
Prepayments and Other Current Assets 5.4 8.8
Regulatory Assets/Liabilities 47.8 32.3
Postretirement and Postemployment Benefits 1.3 11.3
Deferred Credits (1.1) (3.4)
Deferred Charges and Other NonCurrent Assets (2.6) 11.8
Other Noncurrent Liabilities 5.3 5.7
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Net Operating Activities from Continuing
Operations 114.4 1,119.8
Net Operating Activities used for Discontinued
Operations (31.1) (61.9)
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Net Cash Flows from Operating Activities 83.3 1,057.9
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Investing Activities
Capital Expenditures (138.8) (206.9)
Insurance Recoveries 0.5 52.0
Proceeds from Disposition of Assets 0.2 2.1
Restricted Cash (46.1) (30.2)
Contributions to equity investments - (10.7)
Other Investing Activities (10.6) (10.2)
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Net Investing Activities used for Continuing
Operations (194.8) (203.9)
Net Investing Activities from Discontinued
Operations 0.4 7.5
Net Cash Flows used for Investing Activities (194.4) (196.4)
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Financing Activities
Issuance of Long-Term Debt - 581.7
Retirement of Long-Term Debt (0.9) (101.4)
Change in Short-Term Debt, Net 267.7 (1,163.5)
Issuance of Common Stock 3.6 0.2
Acquisition of Treasury Stock (1.4) (0.8)
Dividends Paid - Common Stock (63.7) (63.1)
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Net Cash Flows used for Financing Activities 205.3 (746.9)
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Change in cash and cash equivalents from
continuing operations 124.9 169.0
Cash contributions to discontinued operations (30.7) (54.4)
Cash and cash equivalents at beginning of period 16.4 20.6
Cash and Cash Equivalents at End of Period $110.6 $135.2
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SOURCE NiSource Inc.