RICHMOND, Va., Nov. 2,
2015 /PRNewswire/ -- Dominion Resources (NYSE: D) today
announced operating earnings for the three months ended
September 30, 2015, of $611 million ($1.03
per share), compared to operating earnings of $545 million ($0.93
per share) for the same period in 2014. Operating earnings
are defined as reported earnings, determined in accordance with
Generally Accepted Accounting Principles (GAAP), adjusted for
certain items.
Unaudited reported GAAP earnings for the three months ended
September 30, 2015, were $593 million ($1.00
per share) compared with earnings of $529
million ($0.90 per share) for
the same period in 2014.
Dominion uses operating earnings as the primary performance
measurement of its earnings guidance and results for public
communications with analysts and investors. Dominion also
uses operating earnings internally for budgeting, for reporting to
the Board of Directors, for the company's incentive compensation
plans and for its targeted dividend payouts and other purposes.
Dominion management believes operating earnings provide a more
meaningful representation of the company's fundamental earnings
power.
The principal differences between GAAP earnings and operating
earnings for the quarter were out-of-period tax-related items for
our electric operations.
Business segment results and detailed descriptions of items
included in 2015 and 2014 reported earnings but excluded from
operating earnings can be found on Schedules 1, 2 and 3 of this
release.
Thomas F. Farrell II, chairman,
president and chief executive officer, said:
"Our third-quarter operating earnings were in the middle of our
guidance range of $0.95 to $1.10 per
share.
"We continue to execute with strong operational and safety
performance and all major projects in our infrastructure growth
plan are on time and on budget. Construction on Brunswick County, the 1,358-megawatt natural
gas combined-cycle facility is about 89 percent complete and
scheduled to begin commercial operation in the middle of
2016.
"During the quarter, we made formal FERC filings for the
Atlantic Coast Pipeline and Supply Header Project. We plan to
begin construction on both projects in the fourth quarter next
year.
"Our Cove Point liquefaction project is also progressing on time
and on budget. The project overall is about 47 percent
complete and engineering – at 95 percent – is nearly complete."
THIRD-QUARTER 2015 OPERATING EARNINGS COMPARED TO
2014
The increase in third-quarter 2015 operating
earnings per share as compared to third-quarter 2014 operating
earnings per share is primarily attributable to a return to normal
weather and earnings from farmout transactions offset by normal
operating expense growth.
Details of third-quarter 2015 operating earnings as compared to
2014 may be found on Schedule 4 of this release.
FOURTH-QUARTER 2015 OPERATING EARNINGS
GUIDANCE
Dominion expects fourth-quarter 2015 operating
earnings in the range of 85 cents to 95
cents per share, compared to fourth-quarter 2014 operating
earnings of 84 cents per share.
Positive drivers for the fourth quarter of 2015 compared to
the same period of the prior year include growth in our regulated
gas and electric businesses, higher merchant generation margins,
and lower capacity payments offset by lower farmout revenues and
share dilution. GAAP earnings for the fourth quarter of 2014 were
42 cents per share. A
reconciliation between operating and GAAP earnings for the fourth
quarter of 2014 may be found on Schedule 3 of this release.
In providing its fourth-quarter and full-year 2015 operating
earnings guidance, the company notes that there could be
differences between expected reported earnings and estimated
operating earnings for matters such as, but not limited to,
divestitures or changes in accounting principles. At this time,
Dominion management is not able to estimate the aggregate impact of
these items on reported earnings.
CONFERENCE CALL TODAY
Dominion will host its
third-quarter earnings conference call at 10
a.m. ET on Monday, November 2. Dominion management
will discuss its third-quarter financial results and other matters
of interest to the financial community.
Domestic callers should dial (877) 410-5657. The passcode
for the conference call is "Dominion." International callers
should dial (334) 323-9872. Participants should dial in 10 to
15 minutes prior to the scheduled start time. Members of the
media also are invited to listen.
A live webcast of the conference call, including accompanying
slides, and other financial information will be available on the
company's investor information page at www.dom.com/investors.
A replay of the conference call will be available beginning
about 1 p.m. ET November 2 and lasting until 11 p.m. ET November 12. Domestic callers
may access the recording by dialing (877) 919-4059.
International callers should dial (334) 323-0140. The PIN for
the replay is 77229545. Additionally, a replay of the webcast
will be available on the investor information pages by the end of
the day November 2.
Dominion is one of the nation's largest producers and
transporters of energy, with a portfolio of approximately 24,400
megawatts of generation, 12,200 miles of natural gas transmission,
gathering and storage pipeline, and 6,490 miles of electric
transmission lines. Dominion operates one of the nation's
largest natural gas storage systems with 928 billion cubic feet of
storage capacity and serves utility and retail energy customers in
14 states. For more information about Dominion, visit the company's
website at www.dom.com/.
This release contains certain forward-looking statements,
including forecasted operating earnings for fourth-quarter and
full-year 2015 which is subject to various risks and
uncertainties. Factors that could cause actual results to
differ materially from management's projections, forecasts,
estimates and expectations may include factors that are beyond the
company's ability to control or estimate precisely, including
fluctuations in energy-related commodity prices, estimates of
future market conditions, additional competition in our industries,
changes in the demand for Dominion's services, access to and costs
of capital, fluctuations in the value of our pension assets and
assets held in our decommissioning trusts, impacts of acquisitions,
divestitures, transfers of assets to joint ventures or Dominion
Midstream and retirements of assets based on asset portfolio
reviews, the receipt of regulatory approvals for, and timing of,
planned projects, acquisitions and divestitures, the timing and
execution of Dominion Midstream's growth strategy, and the ability
to complete planned construction or expansion projects at all
or within the terms and timeframes initially anticipated.
Other factors include, but are not limited to, weather conditions
and other events, including the effects of hurricanes, earthquakes,
high winds, major storms and changes in water temperatures on
operations, the risk associated with the operation of nuclear
facilities, unplanned outages at facilities in which Dominion has
an ownership interest, the impact of operational hazards and
catastrophic events, state and federal legislative and regulatory
developments, including changes in federal and state tax laws and
changes to environmental and other laws and regulations, including
those related to climate change, greenhouse gases and other
emissions to which we are subject, changes in enforcement practices
of regulators relating to environmental standards and litigation
exposure for remedial activities, political and economic
conditions, industrial, commercial and residential growth or
decline in Dominion's service area, risks of operating businesses
in regulated industries that are subject to changing regulatory
structures, changes to regulated gas and electric rates collected
by Dominion, changes to rating agency requirements and ratings,
changing financial accounting standards, fluctuations in interest
rates, employee workforce factors, including collective bargaining,
counter-party credit and performance risks, adverse outcomes in
litigation matters or regulatory proceedings, the risk of hostile
cyber intrusions and other uncertainties. Other risk factors
are detailed from time to time in Dominion's quarterly reports on
Form 10-Q or most recent annual report on Form 10-K filed with the
Securities and Exchange Commission.
Schedule 1 -
Segment Operating Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preliminary,
Unaudited
|
|
|
|
|
|
(millions, except
earnings per share)
|
Three months ended
September 30,
|
|
|
|
|
2015
|
|
2014
|
|
Change
|
Earnings:
|
|
|
|
|
|
|
|
Dominion Virginia
Power
|
$
125
|
|
$
119
|
|
$
6
|
|
Dominion
Energy
|
152
|
|
144
|
|
8
|
|
Dominion
Generation
|
391
|
|
326
|
|
65
|
|
Corporate and
Other
|
(57)
|
|
(44)
|
|
(13)
|
|
OPERATING
EARNINGS
|
$
611
|
|
$
545
|
|
$
66
|
|
Items excluded from
operating earnings2, 3
|
(18)
|
|
(16)
|
|
(2)
|
|
REPORTED EARNINGS
1
|
$
593
|
|
$
529
|
|
$
64
|
|
|
|
|
|
|
|
|
|
Common Shares
Outstanding (average, diluted)
|
595.5
|
|
584.6
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share
(EPS):
|
|
|
|
|
|
|
Dominion Virginia
Power
|
$
0.21
|
|
$
0.20
|
|
$
0.01
|
|
Dominion
Energy
|
0.26
|
|
0.25
|
|
0.01
|
|
Dominion
Generation
|
0.66
|
|
0.56
|
|
0.10
|
|
Corporate and
Other
|
(0.10)
|
|
(0.08)
|
|
(0.02)
|
|
OPERATING
EARNINGS
|
$
1.03
|
|
$
0.93
|
|
$
0.10
|
|
Items excluded from
operating earnings2
|
(0.03)
|
|
(0.03)
|
|
-
|
|
REPORTED EARNINGS
1
|
$
1.00
|
|
$
0.90
|
|
$
0.10
|
|
|
|
|
|
|
|
|
|
(millions, except
earnings per share)
|
Nine months ended
September 30,
|
|
|
|
|
2015
|
|
2014
|
|
Change
|
Earnings:
|
|
|
|
|
|
|
|
Dominion Virginia
Power
|
$
382
|
|
$
366
|
|
$
16
|
|
Dominion
Energy
|
488
|
|
482
|
|
6
|
|
Dominion
Generation
|
923
|
|
794
|
|
129
|
|
Corporate and
Other
|
(169)
|
|
(129)
|
|
(40)
|
|
OPERATING
EARNINGS
|
$
1,624
|
|
$
1,513
|
|
$
111
|
|
Items excluded from
operating earnings2, 4
|
(82)
|
|
(446)
|
|
364
|
|
REPORTED EARNINGS
1
|
$
1,542
|
|
$
1,067
|
|
$
475
|
|
|
|
|
|
|
|
|
|
Common Shares
Outstanding (average, diluted)
|
592.7
|
|
583.8
|
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share
(EPS):
|
|
|
|
|
|
|
Dominion Virginia
Power
|
$
0.64
|
|
$
0.63
|
|
$
0.01
|
|
Dominion
Energy
|
0.82
|
|
0.82
|
|
-
|
|
Dominion
Generation
|
1.56
|
|
1.36
|
|
0.20
|
|
Corporate and
Other
|
(0.28)
|
|
(0.22)
|
|
(0.06)
|
|
OPERATING
EARNINGS
|
$
2.74
|
|
$
2.59
|
|
$
0.15
|
|
Items excluded from
operating earnings2
|
(0.14)
|
|
(0.76)
|
|
0.62
|
|
REPORTED EARNINGS
1
|
$
2.60
|
|
$
1.83
|
|
$
0.77
|
|
|
|
|
|
|
|
|
|
|
1)
|
Determined in
accordance with Generally Accepted Accounting Principles
(GAAP).
|
|
2)
|
Items excluded from
operating earnings are reported in Corporate and Other
segment. Refer to Schedules
|
|
|
2 and 3 for details,
or find "GAAP Reconciliation" in the Earnings Release Kit on
Dominion's website
|
|
|
at
www.dom.com/investors.
|
|
3)
|
Pre-tax amounts for
the current period and the prior period are ($19) million and ($54)
million, respectively.
|
|
4)
|
Pre-tax amounts for
the current period and the prior period are ($122) million and
($708) million, respectively.
|
Schedule 2 - Reconciliation of 2015 Operating Earnings to
Reported Earnings
2015 Earnings (nine months ended September 30, 2015)
The net effects of the following items, all shown on an
after-tax basis, are included in 2015 reported earnings, but are
excluded from operating earnings:
- $52 million charge associated
with Virginia legislation enacted in February that required the
write-off of Virginia Power
prior-period deferred fuel costs during the first quarter of
2015.
- $28 million charge associated
with the asset retirement obligations for ash ponds and landfills
at certain utility generation facilities in connection with the
enactment of EPA coal combustion residuals rules in the second
quarter of 2015.
- $2 million net expense related to
other items.
(millions,
except per share amounts)
|
1Q15
|
2Q15
|
3Q15
|
4Q15
|
YTD
2015
|
2
|
Operating
earnings
|
$584
|
$429
|
$611
|
|
$1,624
|
|
Items excluded
from operating earnings (after-tax):
|
|
|
|
|
|
|
|
Write-off of deferred
fuel costs
|
(52)
|
|
|
|
(52)
|
|
|
Future ash pond and
landfill closure costs
|
|
(28)
|
|
|
(28)
|
|
|
Other
items
|
4
|
12
|
(18)
|
|
(2)
|
|
|
Total items excluded
from operating earnings (after-tax) 1
|
(48)
|
(16)
|
(18)
|
|
(82)
|
|
Reported net
income
|
$536
|
$413
|
$593
|
|
$1,542
|
|
Common shares
outstanding (average, diluted)
|
589.9
|
592.5
|
595.5
|
|
592.7
|
|
Operating earnings
per share
|
$0.99
|
$0.73
|
$1.03
|
|
$2.74
|
|
Items excluded from
operating earnings (after-tax)
|
(0.08)
|
(0.03)
|
(0.03)
|
|
(0.14)
|
|
Reported earnings
per share
|
$0.91
|
$0.70
|
$1.00
|
|
$2.60
|
|
|
|
|
|
|
|
|
|
1)
|
Pre-tax amounts
for items excluded from operating earnings are reflected in the
following table:
|
|
|
Items excluded from
operating earnings:
|
1Q15
|
2Q15
|
3Q15
|
4Q15
|
YTD
2015
|
|
|
|
|
|
|
|
|
|
|
Write-off of deferred
fuel costs
|
(85)
|
|
|
|
(85)
|
|
|
Future ash pond and
landfill closure costs
|
|
(45)
|
|
|
(45)
|
|
|
Other
items
|
9
|
18
|
(19)
|
|
8
|
|
|
Total items excluded
from operating earnings
|
($76)
|
($27)
|
($19)
|
|
($122)
|
|
|
|
|
|
|
|
|
|
2)
|
YTD EPS may not
equal sum of quarters due to share count
differences
|
|
|
Schedule 3 - Reconciliation of 2014 Operating Earnings to
Reported Earnings
2014 Earnings (Twelve months ended December 31, 2014)
The net effects of the following items, all shown on an
after-tax basis, are included in 2014 reported earnings, but are
excluded from operating earnings:
- $248 million charge associated
with Virginia legislation enacted in April that permits
Virginia Power to recover 70% of the
costs previously deferred or capitalized through Dec. 31, 2013 relating to the development of a
third nuclear unit located at North Anna and offshore wind
facilities as part of the 2013 and 2014 base rates.
- $193 million net charge related
to the repositioning of our Producer Services business, reflecting
the termination of natural gas trading and certain energy marketing
activities.
- $174 million charge associated
with our liability management exercise, mainly reflecting the call
premiums on our early debt redemptions in the fourth quarter.
- $74 million charge related to a
settlement offer to incur future ash pond closure costs at certain
utility generation facilities.
- $31 million goodwill write-off
associated with the company exiting the unregulated electric retail
energy marketing business.
- $27 million net benefit related
to other items.
(millions,
except per share amounts)
|
1Q14
|
2Q14
|
3Q14
|
4Q14
|
YTD
2014
|
2
|
Operating
earnings
|
$607
|
$361
|
$545
|
$490
|
$2,003
|
|
Items excluded
from operating earnings (after-tax):
|
|
|
|
|
|
|
|
North Anna and
offshore wind facilities
|
|
(191)
|
(28)
|
(29)
|
(248)
|
|
|
Producer Services
repositioning
|
(193)
|
|
|
|
(193)
|
|
|
Charges associated
with liability management exercise
|
|
|
(2)
|
(172)
|
(174)
|
|
|
Future ash pond
closure costs
|
|
|
|
(74)
|
(74)
|
|
|
Goodwill write-off at
unregulated electric retail
|
(31)
|
|
|
|
(31)
|
|
|
Other
items
|
(4)
|
(11)
|
14
|
28
|
27
|
|
|
Total items excluded
from operating earnings (after-tax) 1
|
(228)
|
(202)
|
(16)
|
(247)
|
(693)
|
|
Reported net
income
|
$379
|
$159
|
$529
|
$243
|
$1,310
|
|
Common shares
outstanding (average, diluted)
|
582.9
|
583.9
|
584.6
|
586.5
|
584.5
|
|
Operating earnings
per share
|
$1.04
|
$0.62
|
$0.93
|
$0.84
|
$3.43
|
|
Items excluded from
operating earnings (after-tax)
|
(0.39)
|
(0.35)
|
(0.03)
|
(0.42)
|
(1.19)
|
|
Reported earnings
per share
|
$0.65
|
$0.27
|
$0.90
|
$0.42
|
$2.24
|
|
|
|
|
|
|
|
|
|
1)
|
Pre-tax amounts
for items excluded from operating earnings are reflected in the
following table:
|
|
|
Items excluded from
operating earnings:
|
1Q14
|
2Q14
|
3Q14
|
4Q14
|
YTD
2014
|
|
|
|
|
|
|
|
|
|
|
North Anna and
offshore wind facilities
|
|
(287)
|
(43)
|
(44)
|
(374)
|
|
|
Producer Services
repositioning
|
(319)
|
|
|
|
(319)
|
|
|
Charges associated
with liability management exercise
|
|
|
(3)
|
(281)
|
(284)
|
|
|
Future ash pond
closure costs
|
|
|
|
(121)
|
(121)
|
|
|
Goodwill write-off at
unregulated electric retail
|
(31)
|
|
|
|
(31)
|
|
|
Other
items
|
(2)
|
(15)
|
(8)
|
(12)
|
(37)
|
|
|
Total items excluded
from operating earnings
|
($352)
|
($302)
|
($54)
|
($458)
|
($1,166)
|
|
|
|
|
|
|
|
|
|
2)
|
YTD EPS may not
equal sum of quarters due to share count
differences.
|
|
Schedule 4 -
Reconciliation of 3Q15 Earnings to 3Q14
|
|
|
|
|
|
|
Preliminary,
unaudited
|
|
Three Months
Ended
|
(millions,
except EPS)
|
|
September
30,
|
|
|
|
2015 vs.
2014
|
|
|
|
Increase /
(Decrease)
|
Reconciling
Items
|
|
Amount
|
EPS
|
|
|
|
|
|
Dominion
Virginia Power
|
|
|
|
|
Regulated electric
sales
|
|
$4
|
$0.01
|
|
FERC Transmission
equity return
|
|
10
|
0.02
|
|
Other
|
|
(8)
|
(0.02)
|
|
Change in
contribution to operating earnings
|
|
$6
|
$0.01
|
|
|
|
|
|
Dominion
Energy
|
|
|
|
|
Gas Distribution
margin
|
|
$8
|
$0.01
|
|
Farmout
transactions
|
|
28
|
0.05
|
|
Depreciation and
amortization
|
|
(3)
|
0.00
|
|
Noncontrolling
interest
|
|
(3)
|
0.00
|
|
Other operations and
maintenance expense
|
|
(13)
|
(0.02)
|
|
Other
|
|
(9)
|
(0.02)
|
|
Share
dilution
|
|
0
|
(0.01)
|
|
Change in
contribution to operating earnings
|
|
$8
|
$0.01
|
|
|
|
|
|
Dominion
Generation
|
|
|
|
|
Regulated electric
sales
|
|
$14
|
$0.02
|
|
Merchant generation
margin
|
|
19
|
0.04
|
|
Depreciation and
amortization
|
|
(8)
|
(0.01)
|
|
Renewable energy
investment tax credits
|
|
36
|
0.06
|
|
Other
|
|
4
|
0.00
|
|
Share
dilution
|
|
0
|
(0.01)
|
|
Change in
contribution to operating earnings
|
|
$65
|
$0.10
|
|
|
|
|
|
Corporate and
Other
|
|
|
|
|
Renewable energy
investment tax credits
|
|
($30)
|
($0.05)
|
|
Other
|
|
17
|
0.03
|
|
Change in
contribution to operating earnings
|
|
($13)
|
($0.02)
|
|
|
|
|
|
Change in
consolidated operating earnings
|
|
$66
|
$0.10
|
|
|
|
|
|
Change in items
excluded from operating
earnings1
|
|
($2)
|
$0.00
|
|
|
|
|
|
Change in
reported earnings (GAAP)
|
|
$64
|
$0.10
|
|
|
|
|
|
|
|
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1)
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Refer to Schedules
2 and 3 for details of items excluded from operating earnings, or
find "GAAP Reconciliation"
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on Dominion's
website at www.dom.com/investors.
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To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/dominion-announces-third-quarter-2015-earnings-300169661.html
SOURCE Dominion Resources