HOUSTON, May 6, 2015 /PRNewswire/ --
First Quarter Highlights:
- Strong contributions from expansion projects in U.S.
Transmission and Liquids
- Expansion projects continue to advance as planned and add to
cash generation
- DCF continues to support ongoing dividend growth
Spectra Energy Corp (NYSE: SE) today reported first quarter 2015
net income from controlling interests of $267 million, or $0.40 diluted earnings per share (EPS), compared
with $419 million, or $0.62 diluted EPS in first quarter 2014. Ongoing
net income from controlling interests was $274 million, or $0.41 diluted EPS, compared with $419 million, or $0.62 diluted EPS in first quarter 2014.
For the quarter, ongoing earnings before interest, taxes,
depreciation and amortization (EBITDA) were $788 million, compared with $1.0 billion in the prior-year quarter.
Distributable cash flow (DCF) for the quarter was $578 million, compared with $631 million in the same quarter last year.
"Spectra Energy's first quarter results underscore the
resilience of our business model," said Greg Ebel, chief executive officer, Spectra
Energy. "Our business units performed well this quarter as our
teams are focused on executing their strategies in this challenging
macro environment. Our diversified portfolio of largely
fee-based assets allowed us to exceed our EBITDA and cash
generation expectations for the quarter despite lower than
anticipated commodity prices and the weaker Canadian dollar.
Overall, we are off to a good start to the year and we
continue to generate DCF in line with our targeted 2015
distribution coverage of 1.2 times."
SEGMENT RESULTS
Spectra Energy Partners
Spectra Energy Partners
reported first quarter 2015 ongoing EBITDA of $464 million, compared with $429 million in first quarter 2014. The 2015
period excludes a special item of $9
million related to an impairment of the Ozark Gas Gathering
assets.
SEP's quarterly EBITDA results reflect increased earnings mainly
from expansions previously placed into service – TEAM 2014, TEAM
South, and Kingsport – and from
higher equity earnings from the Sand Hills natural gas liquids
(NGL) pipeline as a result of higher volumes.
Distribution
Distribution reported first quarter 2015
EBITDA of $192 million, compared with
$226 million in first quarter 2014.
The decrease was mainly due to the effect of a weaker Canadian
dollar. First quarter 2014 results also included regulatory
decisions from the Ontario Energy Board (OEB) that, in aggregate,
provided a $10 million benefit to the
segment.
Western Canada Transmission & Processing
The
Western Canada Transmission & Processing segment reported first
quarter 2015 EBITDA of $161 million,
compared with $237 million in first
quarter 2014. While earnings were lower at Empress due to lower
commodity prices, the company's risk management program helped to
stabilize cash flows. The weaker Canadian dollar also lowered
earnings in Western Canada.
Field Services
Spectra Energy reported its 50 percent
share of ongoing earnings from Field Services of ($14) million in first quarter 2015, compared
with equity earnings of $130 million
in first quarter 2014. The decrease in equity earnings was mainly
attributable to lower commodity prices and a decrease in gains
associated with the issuance of partnership units by DCP Midstream
Partners. These decreases were partially offset by growth from
expansion projects, improved operating efficiencies and other cost
savings initiatives. The 2015 period excludes a special item of
$3 million for costs related to
organizational changes that occurred during the quarter. Additional
costs related to these organizational changes are expected to be
incurred through the remainder of this year.
During the first quarters of 2015 and 2014, respectively, NGL
prices averaged $0.49 per gallon
versus $1.06 per gallon, NYMEX
natural gas averaged $2.98 per
million British thermal units (MMBtu) versus $4.94 per MMBtu, and crude oil averaged
approximately $49 per barrel versus
$99 per barrel.
Other
"Other" reported net costs were $15 million in first quarter 2015, compared with
$17 million in first quarter 2014,
and are primarily comprised of corporate costs, including benefits
and captive insurance.
Interest Expense
Interest expense was $159 million in first quarter 2015, compared with
$178 million in first quarter 2014.
The decrease was mainly due to the effect of the weaker Canadian
dollar and lower average long-term debt balances.
Income Taxes
Income tax expense was $101 million in first quarter 2015, compared with
$164 million reported in first
quarter 2014. The decrease in tax expense was mainly due to lower
earnings and the effect of a weaker Canadian dollar. The effective
tax rate was 24 percent in first quarter 2015, compared with 26
percent in first quarter 2014.
Liquidity and Capital Expenditures
Total debt
outstanding at Spectra Energy at March 31,
2015, was $14.3 billion. At the end of the quarter, there
was $2.1 billion of available liquidity at Spectra
Energy Partners and $1.4 billion of available
liquidity at all other Spectra Energy subsidiaries. Spectra Energy
has $2.8 billion of capital expansion spending planned in
2015, of which $2.2 billion will be at Spectra
Energy Partners.
Total capital spending in first quarter 2015 was $403
million, excluding reimbursements from noncontrolling interests,
comprised of approximately $316
million of growth capital expenditures, and $87
million of maintenance capital expenditures.
EXPANSION PROJECT UPDATES
Spectra Energy Partners
At U.S. Transmission, the OPEN
and Uniontown to Gas City projects remain on track to go into
service in the fourth quarter of 2015, bringing incremental
Marcellus and Utica supply to
southern markets and the Midwest, respectively. Together, these two
projects, along with TEAM 2014 and TEAM South – which were brought
into service last year – represent about two-thirds of the 2.4
billion cubic feet (Bcf) per day in projects that will fully
transform Texas Eastern to a bi-directional system by 2017.
NEXUS completed a subsequent open season, which would expand
Texas Eastern by up to 950 million cubic feet per day and create a
direct path for Marcellus and Utica supply to reach NEXUS markets. The
project plans to file its FERC application later this year.
In New England, the AIM project received its FERC certificate
and expects to begin construction in May
2015. The project is 100 percent subscribed by New England's
major local distribution companies and is on track for an
in-service date in the second half of 2016.
The company expects to file a formal FERC application for the
Atlantic Bridge project later this year. This expansion, with
capacity of about 150 million cubic feet per day, will meet the
needs of New England LDC customers who require service in
2017.
Sabal Trail continues to make progress developing a new natural
gas transmission system for the Southeast U.S. On May 5, 2015, Duke Energy announced that it is
taking a 7.5 percent investment interest, joining Spectra Energy
and NextEra Energy as project owners. Sabal Trail is on track to
secure regulatory approvals by early 2016 and meet a 2017
in-service date.
Development work on Access Northeast continues as well. This
project is focused on the New England electric power market and the
widely recognized need to lower consumer electricity prices and
improve energy reliability. The project will bring additional
domestic natural gas to the region by expanding existing pipelines
that already directly connect to about 70 percent of the region's
most efficient gas-fired generation. That expansion will be
combined with enhanced land-based LNG facilities, also fed by
domestic supplies, to ensure natural gas reaches key power plants
when it needs to, even at the highest demand times. Spectra Energy
is developing the $3 billion regional
solution with Eversource Energy and National Grid, companies that
together serve 4.8 million of the 6.5 million electric customers in
New England. To minimize environmental effects, the project will
utilize the existing footprints of the Algonquin and Maritimes
& Northeast pipeline systems.
In addition to the Access Northeast open season, which closed on
May 1, 2015, Spectra Energy has
conducted several other open seasons this year for projects that
would further connect Marcellus and Utica supply to demand markets:
- Texas Eastern's proposed Lebanon Extension project will provide
shippers with the opportunity to obtain firm transportation service
to deliver new natural gas supplies to markets in the Midwest U.S.
The open season concluded in late March and the targeted in-service
date for the project is November
2017.
- The open season for the Marcellus to Market expansion of Texas
Eastern closed April 10, 2015, and
results indicate strong interest from shippers for firm
transportation service that will deliver new incremental production
to markets in the Northeast. The target in-service date for the
Marcellus to Market project is November
2017.
- The proposed Greater Philadelphia Expansion Project will also
grow the Texas Eastern system, providing shippers with new firm
transportation to delivery points along or near the existing
Philadelphia Lateral. The project open season closes this week and
the in-service date could be as early as the second half of
2018.
These three projects represent a combined growth CAPEX
opportunity of $750 million to $1.5
billion for Spectra Energy, beyond what is already in
execution.
The company's Liquids business moved the Express Enhancement
project into execution during the quarter, with a 2016 estimated
in-service date. This $135 million
project is underpinned by long-term, fee-based contracts and will
maximize system throughput on the Express Pipeline through the
addition of on-system terminal and storage assets.
The Red Lake project, which
will expand the reach of Sand Hills to access growing Permian Basin
production, is under construction and scheduled to go into service
during the second quarter 2015.
Distribution
At Union Gas, the 2015 Dawn-Parkway
project is in execution and on track for a fourth quarter
in-service date. The 2016 Dawn-Parkway project received regulatory
approval from the OEB in April, and remains on track as well. In
addition, the 2017 Dawn-Parkway project recently completed its open
season and received strong customer interest. The company expects
to file this project with the OEB mid-year at which point the
project will move into full execution. Further expansions of the
Dawn-Parkway system for 2018 are being explored in response to
continued demand growth expected in Ontario.
Western Canada Transmission & Processing
Work
continues on the two new projects on Spectra Energy's BC Pipeline.
Jackfish Lake is a supply push
project and the Reliability and Maintainability (RAM) project is a
demand pull project. Both projects are on track to be in service in
2017.
Today, the company is announcing a binding open season on the
T-North pipeline system in northeast British Columbia to serve this important
region in Western Canada. This is a supply push project and
is driven by Spectra Energy's ability to add timely capacity at
competitive rates.
Additionally, work continues on the Westcoast Connector project
which is well-positioned with its approved corridor for two 48-inch
pipelines with a design capacity of up to 8.4 Bcf per day. The
Westcoast Connector is the only project with an approved multi-pipe
corridor in British Columbia,
providing attractive cost synergies for future British Columbia LNG
investments while reducing the overall environmental impact.
Field Services
During the quarter, DCP Midstream
Partners' Keathley Canyon Connector gathering pipeline in the
Gulf of Mexico was placed into
service. The project is part of the Discovery joint venture, which
is jointly owned by DCP Midstream Partners and Williams
Partners.
Additional Information
Additional information about
first quarter 2015 earnings can be obtained via the Spectra Energy
website: www.spectraenergy.com.
The analyst call, held jointly with Spectra Energy Partners, is
scheduled for today, Wednesday, May 6,
2015, at 8:00 a.m. CT. The
webcast will be available via the Investors sections of the Spectra
Energy and Spectra Energy Partners websites. The conference call
can be accessed by dialing (888) 252-3715 in the U.S. or
Canada, or (706) 634-8942
internationally. The conference ID is 18703265 or "SE and SEP
Quarterly Earnings Call." Please call five minutes prior to the
scheduled start time.
A replay of the call will be available until 5:00 p.m. CT on Tuesday,
August 4, 2015, by dialing (800) 585-8367 in the U.S. or
Canada, or (404) 537-3406
internationally. The conference ID is 18703265. A replay and
transcript also will be available via the Spectra Energy and
Spectra Energy Partners websites.
Non-GAAP Financial Measures
We use ongoing net income
from controlling interests and ongoing diluted EPS as measures to
evaluate operations of the company. These measures are non-GAAP
financial measures as they represent net income from controlling
interests and diluted EPS, adjusted for special items. Special
items represent certain charges and credits which we believe will
not be recurring on a regular basis. We believe that the
presentation of ongoing net income and ongoing diluted EPS provide
useful information to investors, as it allows them to more
accurately compare our ongoing performance across periods. The most
directly comparable GAAP measures for ongoing net income from
controlling interests and ongoing diluted EPS are net income from
controlling interests and diluted EPS.
The primary performance measure used by us to evaluate segment
performance is segment earnings from continuing operations before
interest, income taxes, and depreciation and amortization (EBITDA).
We consider segment EBITDA, which is the GAAP measure used to
report segment results, to be a good indicator of each segment's
operating performance from its continuing operations as it
represents the results of our segments' operations before
depreciation and amortization without regard to financing methods
or capital structures. Our segment EBITDA may not be comparable to
similarly titled measures of other companies because other
companies may not calculate EBITDA in the same manner.
We also use ongoing segment EBITDA and Other EBITDA (net costs)
as measures of performance. Ongoing segment and Other EBITDA are
non-GAAP financial measures as they represent reported segment and
Other EBITDA adjusted for special items. We believe that the
presentation of ongoing segment and Other EBITDA provides useful
information to investors, as they allow investors to more
accurately compare a segment's or Other's ongoing performance
across periods. The most directly comparable GAAP measures for
ongoing segment or Other EBITDA are reported segment or Other
EBITDA.
We have also presented Distributable Cash Flow, which is a
non-GAAP financial measure. We believe that the presentation of
Distributable Cash Flow provides useful information to investors as
it represents the cash generation capabilities of the company to
support dividend growth. The most directly comparable GAAP measure
for Distributable Cash Flow is net income.
The non-GAAP financial measures presented in this press release
should not be considered in isolation or as an alternative to
financial measures presented in accordance with GAAP. These
non-GAAP financial measures may not be comparable to similarly
titled measures of other companies because other companies may not
calculate these measures in the same manner.
Forward-Looking Statements
This release includes
"forward-looking statements" within the meaning of Section 27A
of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934. Forward-looking statements are
based on our beliefs and assumptions. These forward-looking
statements are identified by terms and phrases such as: anticipate,
believe, intend, estimate, expect, continue, should, could, may,
plan, project, predict, will, potential, forecast, and similar
expressions. Forward-looking statements involve risks and
uncertainties that may cause actual results to be materially
different from the results predicted. Factors that could cause
actual results to differ materially from those indicated in any
forward-looking statement include, but are not limited to: the
success of the completed drop-down; state, federal and foreign
legislative and regulatory initiatives that affect cost and
investment recovery, have an effect on rate structure, and affect
the speed at and degree to which competition enters the natural gas
and oil industries; outcomes of litigation and regulatory
investigations, proceedings or inquiries; weather and other natural
phenomena, including the economic, operational and other effects of
hurricanes and storms; the timing and extent of changes in
commodity prices, interest rates and foreign currency exchange
rates; general economic conditions, including the risk of a
prolonged economic slowdown or decline, or the risk of delay in a
recovery, which can affect the long-term demand for natural gas and
oil and related services; potential effects arising from terrorist
attacks and any consequential or other hostilities; changes in
environmental, safety and other laws and regulations; the
development of alternative energy resources; results and costs of
financing efforts, including the ability to obtain financing on
favorable terms, which can be affected by various factors,
including credit ratings and general market and economic
conditions; increases in the cost of goods and services required to
complete capital projects; declines in the market prices of equity
and debt securities and resulting funding requirements for defined
benefit pension plans; growth in opportunities, including the
timing and success of efforts to develop U.S. and Canadian
pipeline, storage, gathering, processing and other related
infrastructure projects and the effects of competition; the
performance of natural gas and oil transmission and storage,
distribution, and gathering and processing facilities; the extent
of success in connecting natural gas and oil supplies to gathering,
processing and transmission systems and in connecting to expanding
gas and oil markets; the effects of accounting pronouncements
issued periodically by accounting standard-setting bodies;
conditions of the capital markets during the periods covered by
forward-looking statements; and the ability to successfully
complete merger, acquisition or divestiture plans; regulatory or
other limitations imposed as a result of a merger, acquisition or
divestiture; and the success of the business following a merger,
acquisition or divestiture. These factors, as well as additional
factors that could affect our forward-looking statements, are
described under the headings "Risk Factors" and "Cautionary
Statement Regarding Forward-Looking Information" in our 2014 Form
10-K, filed on February 27, 2015, and
in our other filings made with the Securities and Exchange
Commission (SEC), which are available via the SEC's website at
www.sec.gov. In light of these risks, uncertainties and
assumptions, the events described in the forward-looking statements
might not occur or might occur to a different extent or at a
different time than we have described. All forward-looking
statements in this release are made as of the date hereof and we
undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
Spectra Energy Corp (NYSE: SE), a FORTUNE 500 company, is one of
North America's leading pipeline
and midstream companies. Based in Houston, Texas, the company's operations in
the United States and Canada include more than 22,000 miles of
natural gas, natural gas liquids, and crude oil pipelines;
approximately 300 billion cubic feet (Bcf) of natural gas storage;
4.8 million barrels of crude oil storage; as well as natural gas
gathering, processing, and local distribution operations. Spectra
Energy is the general partner of Spectra Energy Partners (NYSE:
SEP), one of the largest pipeline master limited partnerships in
the United States and owner of the
natural gas, natural gas liquids, and crude oil assets in Spectra
Energy's U.S. portfolio. Spectra Energy also has a 50 percent
ownership in DCP Midstream, the largest producer of natural gas
liquids and the largest natural gas processor in the United States. Spectra Energy has served
North American customers and communities for more than a century.
The company's longstanding values are recognized through its
inclusion in the Dow Jones Sustainability World and North America
Indexes and the CDP S&P 500 Climate Disclosure and Performance
Leadership Indexes. For more information, visit
www.spectraenergy.com and www.spectraenergypartners.com.
Spectra Energy
Corp
|
Quarterly
Highlights
|
March
2015
|
(Unaudited)
|
(In millions, except
per-share amounts and where noted)
|
|
|
|
|
|
|
|
Three Months
Ended March 31,
|
|
|
2015
|
|
2014
|
COMMON STOCK
DATA
|
|
|
|
|
Earnings Per Share,
Diluted
|
|
$
|
0.40
|
|
|
$
|
0.62
|
|
Dividends Per
Share
|
|
$
|
0.37
|
|
|
$
|
0.335
|
|
Weighted-Average
Shares Outstanding, Diluted
|
|
673
|
|
|
672
|
|
|
|
|
|
|
INCOME
|
|
|
|
|
Operating
Revenues
|
|
$
|
1,623
|
|
|
$
|
1,843
|
|
Total Reportable
Segment EBITDA
|
|
791
|
|
|
1,022
|
|
Net Income -
Controlling Interests
|
|
267
|
|
|
419
|
|
|
|
|
|
|
EBITDA BY BUSINESS
SEGMENT
|
|
|
|
|
Spectra Energy
Partners
|
|
$
|
455
|
|
|
$
|
429
|
|
Distribution
|
|
192
|
|
|
226
|
|
Western Canada
Transmission & Processing
|
|
161
|
|
|
237
|
|
Field
Services
|
|
(17)
|
|
|
130
|
|
Total Reportable
Segment EBITDA
|
|
791
|
|
|
1,022
|
|
Other
EBITDA
|
|
(15)
|
|
|
(17)
|
|
Total Reportable
Segment and Other EBITDA
|
$
|
776
|
|
|
$
|
1,005
|
|
|
|
|
|
|
DISTRIBUTABLE CASH
FLOW
|
|
|
|
|
Distributable Cash
Flow
|
|
$
|
578
|
|
|
$
|
631
|
|
|
|
|
|
|
CAPITAL AND
INVESTMENT EXPENDITURES
|
|
|
|
|
Spectra Energy
Partners (a)
|
|
$
|
255
|
|
|
$
|
199
|
|
Distribution
|
|
89
|
|
|
44
|
|
Western Canada
Transmission & Processing
|
|
45
|
|
|
140
|
|
Other
|
|
14
|
|
|
9
|
|
Total Capital
and Investment Expenditures, Excluding Acquisitions (a)
|
|
$
|
403
|
|
|
$
|
392
|
|
|
|
|
|
|
Expansion and
Investment (a)
|
|
316
|
|
|
$
|
308
|
|
Maintenance and
Other
|
|
87
|
|
|
84
|
|
Total Capital
and Investment Expenditures, Excluding Acquisitions (a)
|
|
$
|
403
|
|
|
$
|
392
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
2015
|
|
2014
|
CAPITALIZATION
|
|
|
|
|
Common Equity -
Controlling Interests
|
|
31
|
%
|
|
32
|
%
|
Noncontrolling
Interests and Preferred Stock
|
|
11
|
%
|
|
10
|
%
|
Total Debt
|
|
58
|
%
|
|
58
|
%
|
|
|
|
|
|
Total Debt
|
|
$
|
14,293
|
|
|
$
|
14,679
|
|
Book Value Per Share
(b)
|
|
$
|
11.49
|
|
|
$
|
12.16
|
|
Actual Shares
Outstanding
|
|
671
|
|
|
671
|
|
|
|
|
|
|
(a) Excludes
contributions received from noncontrolling interests of $58 million
in 2015 and $6 million in 2014.
|
(b) Represents
controlling interests.
|
|
|
|
|
Spectra Energy
Corp
|
Quarterly
Highlights
|
March
2015
|
(Unaudited)
|
(In millions, except
where noted)
|
|
|
|
|
|
Three Months
Ended March 31,
|
|
|
2015
|
|
2014
|
SPECTRA ENERGY
PARTNERS
|
|
|
|
|
Operating
Revenues
|
|
$
|
606
|
|
|
$
|
581
|
|
Operating
Expenses
|
|
|
|
|
Operating,
Maintenance and Other
|
|
207
|
|
|
185
|
|
Other Income
and Expenses
|
|
56
|
|
|
33
|
|
EBITDA
|
|
$
|
455
|
|
|
$
|
429
|
|
Express
Pipeline Revenue Receipts, MBbl/d (a)
|
|
246
|
|
|
225
|
|
Platte PADD II
Deliveries, MBbl/d
|
|
169
|
|
|
166
|
|
Canadian Dollar
Exchange Rate, Average
|
|
1.24
|
|
|
1.10
|
|
|
|
|
|
|
DISTRIBUTION
|
|
|
|
|
Operating
Revenues
|
|
$
|
662
|
|
|
$
|
718
|
|
Operating
Expenses
|
|
|
|
|
Natural Gas
Purchased
|
|
383
|
|
|
388
|
|
Operating,
Maintenance and Other
|
|
86
|
|
|
103
|
|
Other Income
and Expenses
|
|
(1)
|
|
|
(1)
|
|
EBITDA
|
|
$
|
192
|
|
|
$
|
226
|
|
Number of
Customers, Thousands
|
|
1,422
|
|
|
1,401
|
|
Heating Degree
Days, Fahrenheit
|
|
4,259
|
|
|
4,251
|
|
Pipeline
Throughput, TBtu (b)
|
|
328
|
|
|
294
|
|
Canadian Dollar
Exchange Rate, Average
|
|
1.24
|
|
|
1.10
|
|
|
|
|
|
|
WESTERN CANADA
TRANSMISSION & PROCESSING
|
|
|
|
|
Operating
Revenues
|
|
$
|
370
|
|
|
$
|
575
|
|
Operating
Expenses
|
|
|
|
|
Natural Gas and
Petroleum Products Purchased
|
|
67
|
|
|
174
|
|
Operating,
Maintenance and Other
|
|
147
|
|
|
165
|
|
Other Income
and Expenses
|
|
5
|
|
|
1
|
|
EBITDA
|
|
$
|
161
|
|
|
$
|
237
|
|
Pipeline
Throughput, TBtu
|
|
256
|
|
|
242
|
|
Volumes
Processed, TBtu
|
|
180
|
|
|
177
|
|
Canadian Dollar
Exchange Rate, Average
|
|
1.24
|
|
|
1.10
|
|
|
|
|
|
|
FIELD
SERVICES
|
|
|
|
|
Equity in
Earnings of DCP Midstream, LLC
|
|
$
|
(17)
|
|
|
$
|
130
|
|
Cash
Distributions to Spectra Energy
|
|
$
|
—
|
|
|
$
|
59
|
|
Natural Gas
Gathered and Processed/Transported, TBtu/day (c)
|
|
7.1
|
|
|
7.2
|
|
Natural Gas
Liquids Production, MBbl/d (c)
|
|
399
|
|
|
445
|
|
Average Natural
Gas Price Per MMBtu (d)
|
|
$
|
2.98
|
|
|
$
|
4.94
|
|
Average Natural
Gas Liquids Price Per Gallon (e)
|
|
$
|
0.49
|
|
|
$
|
1.06
|
|
Average Crude
Oil Price Per Barrel (f)
|
|
$
|
48.63
|
|
|
$
|
98.68
|
|
|
|
|
|
|
|
|
|
|
|
(a)
Thousand barrels per day.
|
|
|
|
|
(b)
Trillion British thermal units.
|
|
|
|
|
(c)
Reflects 100% of DCP Midstream volumes.
|
|
|
|
|
(d)
Million British thermal units. Average price based on NYMEX Henry
Hub.
|
|
|
(e) Does
not reflect results of commodity hedges.
|
|
|
|
(f)
Average price based on NYMEX calendar month.
|
|
|
|
Spectra Energy
Corp
|
Condensed
Consolidated Statements of Operations
|
(Unaudited)
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended March 31,
|
|
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
Operating
Revenues
|
|
|
$
|
1,623
|
|
|
$
|
1,843
|
|
|
|
|
|
|
|
Operating
Expenses
|
|
|
1,082
|
|
|
1,204
|
|
|
|
|
|
|
|
|
|
Operating
Income
|
|
|
541
|
|
|
639
|
|
|
|
|
|
|
|
|
|
Other Income and
Expenses
|
|
|
44
|
|
|
170
|
|
|
|
|
|
|
|
Interest
Expense
|
|
|
159
|
|
|
178
|
|
|
|
|
|
|
Earnings Before
Income Taxes
|
|
426
|
|
|
631
|
|
|
|
|
|
|
|
Income Tax
Expense
|
|
|
101
|
|
|
164
|
|
|
|
|
|
|
|
Net Income
|
|
|
325
|
|
|
467
|
|
|
|
|
|
|
|
Net Income -
Noncontrolling Interests
|
|
|
58
|
|
|
48
|
|
|
|
|
|
|
|
Net Income -
Controlling Interests
|
|
|
$
|
267
|
|
|
$
|
419
|
|
Spectra Energy
Corp
|
Condensed
Consolidated Balance Sheets
|
(Unaudited)
|
(In
millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
|
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
Current
Assets
|
|
|
$
|
2,063
|
|
|
$
|
2,332
|
|
Investments and Other
Assets
|
|
|
7,857
|
|
|
8,007
|
|
Net Property, Plant
and Equipment
|
|
|
21,644
|
|
|
22,307
|
|
Regulatory Assets and
Deferred Debits
|
|
|
1,356
|
|
|
1,394
|
|
|
|
|
|
|
|
|
|
Total
Assets
|
|
|
$
|
32,920
|
|
|
$
|
34,040
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Current
Liabilities
|
|
|
$
|
2,717
|
|
|
$
|
3,809
|
|
Long-term
Debt
|
|
|
13,178
|
|
|
12,769
|
|
Deferred Credits and
Other Liabilities
|
|
|
6,736
|
|
|
6,806
|
|
Preferred Stock of
Subsidiaries
|
|
|
258
|
|
|
258
|
|
Equity
|
|
|
10,031
|
|
|
10,398
|
|
|
|
|
|
|
|
|
|
|
|
Total Liabilities
and Equity
|
|
|
$
|
32,920
|
|
|
$
|
34,040
|
|
Spectra Energy
Corp
|
Distributable Cash
Flow
|
(Unaudited)
|
(In
millions)
|
|
|
|
|
|
|
|
Year-To-Date
|
|
|
March
31,
|
|
|
2015
|
|
2014
|
|
|
|
|
|
Net
Income
|
|
$
|
325
|
|
|
$
|
467
|
|
Add:
|
|
|
|
|
Interest
expense
|
|
159
|
|
|
178
|
|
Income tax
expense
|
|
101
|
|
|
164
|
|
Depreciation and
amortization
|
|
193
|
|
|
200
|
|
Foreign currency
gain
|
|
(1)
|
|
|
(3)
|
|
Less:
|
|
|
|
|
Third party interest
income
|
|
1
|
|
|
1
|
|
EBITDA
|
|
776
|
|
|
1,005
|
|
|
|
|
|
|
Add:
|
|
|
|
|
Equity in earnings of
unconsolidated affiliates
|
|
(24)
|
|
|
(161)
|
|
Distributions from
unconsolidated affiliates (a)
|
|
54
|
|
|
99
|
|
Empress non-cash mark
to market
|
|
22
|
|
|
4
|
|
Non-cash impairment
at Ozark Gas Gathering
|
|
9
|
|
|
—
|
|
Other
|
|
5
|
|
|
(13)
|
|
Less:
|
|
|
|
|
Interest
expense
|
|
159
|
|
|
178
|
|
Equity
AFUDC
|
|
16
|
|
|
6
|
|
Net cash refund for
income taxes
|
|
(46)
|
|
|
(12)
|
|
Distributions to
noncontrolling interests
|
|
44
|
|
|
39
|
|
Maintenance capital
expenditures (b)
|
|
91
|
|
|
92
|
|
Total
Distributable Cash Flow
|
|
$
|
578
|
|
|
$
|
631
|
|
|
|
|
|
|
|
|
|
|
|
(a) Excludes $2
million and $12 million in distributions of investment in equity
method affiliates for the three
month periods ended March 31, 2015
and 2014, respectively.
|
(b) Excludes
reimbursable expenditures.
|
|
|
|
|
|
|
|
|
|
|
Spectra Energy
Corp
|
|
Reported to
Ongoing Earnings Reconciliation
|
|
March 2015
Year-to-date
|
|
(Unaudited)
|
|
(In millions, except
per-share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported
Earnings
|
|
Special
Items
|
|
Ongoing
Earnings
|
|
SEGMENT
EARNINGS BEFORE INTEREST, TAXES, AND DEPRECIATION AND
AMORTIZATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Spectra Energy
Partners
|
|
$
|
455
|
|
|
$
|
9
|
|
A
|
$
|
464
|
|
|
|
|
|
|
|
|
|
|
|
|
Distribution
|
|
192
|
|
|
—
|
|
|
192
|
|
|
|
|
|
|
|
|
|
|
|
|
Western Canada
Transmission & Processing
|
|
161
|
|
|
—
|
|
|
161
|
|
|
|
|
|
|
|
|
|
|
|
|
Field
Services
|
|
(17)
|
|
|
3
|
|
B
|
(14)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Reportable
Segment EBITDA
|
|
791
|
|
|
12
|
|
|
803
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
(15)
|
|
|
—
|
|
|
(15)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Reportable
Segment and Other EBITDA
|
|
$
|
776
|
|
|
$
|
12
|
|
|
$
|
788
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Reportable
Segment EBITDA and Other EBITDA
|
|
$
|
776
|
|
|
$
|
12
|
|
|
$
|
788
|
|
|
Depreciation and
Amortization
|
|
(193)
|
|
|
—
|
|
|
(193)
|
|
|
Interest
Expense
|
|
(159)
|
|
|
—
|
|
|
(159)
|
|
|
Interest Income and
Other
|
|
2
|
|
|
—
|
|
|
2
|
|
|
Income Tax
Expense
|
|
(101)
|
|
|
(4)
|
|
|
(105)
|
|
|
Total Net
Income
|
|
325
|
|
|
8
|
|
|
333
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Net
Income - Noncontrolling Interests
|
|
(58)
|
|
|
(1)
|
|
|
(59)
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Net
Income - Controlling Interests
|
|
$
|
267
|
|
|
$
|
7
|
|
|
$
|
274
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER
SHARE, BASIC
|
|
$
|
0.40
|
|
|
$
|
0.01
|
|
|
$
|
0.41
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER
SHARE, DILUTED
|
|
$
|
0.40
|
|
|
$
|
0.01
|
|
|
$
|
0.41
|
|
|
|
|
|
|
|
|
|
|
|
|
A - Impairment
charges at Ozark Gas Gathering.
|
|
B - Restructuring
costs at Field Services.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Shares (reported and ongoing) - in millions
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
671
|
|
|
|
|
|
|
|
|
|
Diluted
|
673
|
|
|
|
|
|
|
|
Spectra Energy
Corp
|
|
Reported to
Ongoing Earnings Reconciliation
|
|
March 2014
Year-to-date
|
|
(Unaudited)
|
|
(In millions, except
per-share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported/
Ongoing
Earnings
|
|
|
SEGMENT
EARNINGS BEFORE INTEREST, TAXES, AND
DEPRECIATION AND AMORTIZATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Spectra Energy
Partners
|
|
$
|
429
|
|
|
|
|
|
|
|
|
|
|
Distribution
|
|
226
|
|
|
|
|
|
|
|
|
|
|
Western Canada
Transmission & Processing
|
|
237
|
|
|
|
|
|
|
|
|
|
|
Field
Services
|
|
130
|
|
|
|
|
|
|
|
|
|
|
Total Reportable
Segment EBITDA
|
|
1,022
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
(17)
|
|
|
|
|
|
|
|
|
|
|
Total Reportable
Segment and Other EBITDA
|
|
$
|
1,005
|
|
|
|
|
|
|
|
|
|
|
EARNINGS
|
|
|
|
|
|
|
|
|
|
|
|
Total Reportable
Segment EBITDA and Other EBITDA
|
|
$
|
1,005
|
|
|
|
Depreciation and
Amortization
|
|
(200)
|
|
|
|
Interest
Expense
|
|
(178)
|
|
|
|
Interest Income and
Other
|
|
4
|
|
|
|
Income Tax
Expense
|
|
(164)
|
|
|
|
Total Net
Income
|
|
467
|
|
|
|
|
|
|
|
|
|
|
Total Net
Income - Noncontrolling Interests
|
|
(48)
|
|
|
|
|
|
|
|
|
|
|
Total Net
Income - Controlling Interests
|
|
$
|
419
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER
SHARE, BASIC
|
|
$
|
0.63
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER
SHARE, DILUTED
|
|
$
|
0.62
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average
Shares (reported and ongoing) - in millions
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
670
|
|
|
|
|
|
|
Diluted
|
672
|
|
|
|
|
|
Logo - http://photos.prnewswire.com/prnh/20061030/CLM051LOGO
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/spectra-energy-reports-first-quarter-2015-results-300078407.html
SOURCE Spectra Energy Corp