ATLANTA, April 27, 2016 /PRNewswire/ -- Southern
Company today reported first-quarter 2016 earnings of $485 million, or 53
cents per share, compared with earnings of $508 million, or 56
cents per share, in the first quarter of 2015.
Earnings for the first quarter of 2016 include after-tax charges
of $33 million, or 4 cents per share, related to an increased cost
estimate for the construction of Mississippi Power's Kemper
integrated gasification combined cycle (IGCC) project.
First-quarter earnings for 2015 included an after-tax charge of
$6 million for the Kemper IGCC
project. Earnings for the first quarter of 2016 also include an
after-tax charge of $14 million, or
1 cent per share, related to the
proposed acquisitions of AGL Resources and PowerSecure
International. Excluding these items, Southern Company earned
$532 million, or 58 cents per share, during the first quarter of
2016, compared with earnings of $514
million, or 56 cents per
share, in the first quarter of 2015.
Earnings drivers year-over-year for the first quarter of 2016
included retail revenue effects across the regulated operating
companies and lower non-fuel operating and maintenance costs offset
by mild weather and higher depreciation expenses. Wholesale
subsidiary Southern Power also contributed positively
year-over-year as a result of the anticipated tax benefits for 2016
renewable projects and increased revenue from 2015 renewable
projects.
"Southern Company performed superbly in executing its business
plan in the first quarter of 2016. We saw positive customer growth,
along with strong residential and commercial sales and a robust
economic development pipeline," said Southern Company Chairman,
President and CEO, Thomas A.
Fanning. "Our franchise operations and our competitive
generation subsidiary, Southern Power, continue to perform at a
high level and deliver on our core strategy of providing clean,
safe, reliable and affordable energy to customers."
First-quarter 2016 operating revenues were $3.97 billion, compared with operating revenues
of $4.18 billion for the same period
in 2015, a decrease of 5.2 percent. This decrease was primarily due
to lower fuel costs.
Kilowatt-hour sales to retail customers in Southern Company's
four-state service area decreased 3.0 percent in the first quarter
of 2016, compared with the first quarter of 2015. Residential
energy sales decreased 7.2 percent, commercial energy sales
decreased 0.7 percent and industrial energy sales decreased 0.8
percent.
Weather-adjusted kilowatt-hour sales to retail customers in
Southern Company's four-state service area increased 0.4 percent in
the first quarter of 2016, compared with the first quarter of 2015.
Weather-adjusted residential energy sales increased 1.4 percent and
weather-adjusted commercial energy sales increased 0.8 percent.
Total energy sales to the Southern Company system's customers,
including wholesale sales, decreased 1.7 percent in the first
quarter of 2016, compared with the same period in 2015.
Southern Company's financial analyst call will begin at
1 p.m. Eastern time today, during
which Fanning and Chief Financial Officer Art P. Beattie will discuss earnings and provide
a general business update. Investors, media and the public may
listen to a live webcast of the call and view associated slides at
http://investor.southerncompany.com/webcasts. A replay of the
webcast will be available at the site for 12 months.
Southern Company has also posted on its website detailed
financial information on its first-quarter 2016 earnings
performance. These materials are available at
www.southerncompany.com.
With more than 4.5 million customers and approximately 44,000
megawatts of generating capacity, Atlanta-based Southern Company (NYSE: SO) is
the premier energy company serving the Southeast through its
subsidiaries. A leading U.S. producer of clean, safe, reliable and
affordable electricity, Southern Company owns electric utilities in
four states and a growing competitive generation company, as well
as fiber optics and wireless communications. Southern Company
brands are known for excellent customer service, high reliability
and affordable prices that are below the national average. Through
an industry-leading commitment to innovation, Southern Company and
its subsidiaries are inventing America's energy future by
developing the full portfolio of energy resources, including
nuclear, 21st century coal, natural gas, renewables and
energy efficiency, and creating new products and services for the
benefit of customers. Southern Company has been named by the
U.S. Department of Defense and G.I.
Jobs magazine as a top military employer, listed by Black
Enterprise magazine as one of the 40 Best Companies for Diversity
and designated a 2014 Top Employer for Hispanics by Hispanic
Network. The company earned the 2014 National Award of Nuclear
Science and History from the National Atomic Museum Foundation for
its leadership and commitment to nuclear development, and is
continually ranked among the top utilities in Fortune's annual
World's Most Admired Electric and Gas Utility
rankings. Visit our website at www.southerncompany.com.
Southern
Company
|
Financial
Highlights
|
(In Millions of
Dollars Except Earnings Per Share)
|
|
|
|
|
|
|
|
Three Months
Ended
March
|
|
|
2016
|
|
2015
|
Consolidated
Earnings–As Reported
|
|
|
|
|
(See
Notes)
|
|
|
|
|
Traditional
Operating Companies
|
|
$
|
464
|
|
|
$
|
477
|
|
Southern
Power
|
|
50
|
|
|
33
|
|
Total
|
|
514
|
|
|
510
|
|
Parent Company
and Other
|
|
(29)
|
|
|
(2)
|
|
Net
Income–As Reported
|
|
$
|
485
|
|
|
$
|
508
|
|
|
|
|
|
|
Basic Earnings
Per Share
|
|
$
|
0.53
|
|
|
$
|
0.56
|
|
|
|
|
|
|
Average Shares
Outstanding (in millions)
|
|
916
|
|
|
910
|
|
End of Period
Shares Outstanding (in millions)
|
|
918
|
|
|
908
|
|
|
|
|
|
|
|
|
Three Months
Ended
March
|
|
|
2016
|
|
2015
|
Consolidated
Earnings–Excluding Items
|
|
|
|
|
(See
Notes)
|
|
|
|
|
Net Income–As
Reported
|
|
$
|
485
|
|
|
$
|
508
|
|
Estimated Loss on
Kemper IGCC
|
|
33
|
|
|
6
|
|
Acquisition
Costs
|
|
14
|
|
|
—
|
|
Net
Income–Excluding Items
|
|
$
|
532
|
|
|
$
|
514
|
|
|
|
|
|
|
Basic Earnings
Per Share–Excluding Items
|
|
$
|
0.58
|
|
|
$
|
0.56
|
|
|
|
|
|
|
Notes
|
|
|
|
|
- For the three
months ended March 31, 2016 and 2015, dilution does not change
basic earnings per share by more than 1 cent and is not
material.
|
|
|
|
|
|
- The estimated
probable losses relating to Mississippi Power Company's
construction of the integrated coal
gasification combined
cycle facility in Kemper County, Mississippi (Kemper IGCC)
significantly impacted the
presentation of
earnings and earnings per share for the three months ended March
31, 2016 and any similar charges
may occur with
uncertain frequency.
|
|
- Earnings for the
three months ended March 31, 2016 include costs related to the
proposed acquisitions of AGL Resources Inc. and PowerSecure
International, Inc. Further costs are expected to continue to occur
in connection with closing the proposed acquisitions and supporting
the related integrations.
|
|
- All figures in this
earnings release are preliminary and remain subject to the
completion of normal quarter-end accounting procedures and
adjustments, which could result in changes to these preliminary
results. In addition, certain classifications and rounding may be
different from final results published in the Form 10-Q.
|
Southern
Company
|
Significant
Factors Impacting EPS
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March
|
|
|
2016
|
|
2015
|
|
Change
|
Consolidated
Earnings Per Share–
|
|
|
|
|
|
|
As Reported (See
Notes)
|
|
$
|
0.53
|
|
|
$
|
0.56
|
|
|
$
|
(0.03)
|
|
|
|
|
|
|
|
|
Significant
Factors:
|
|
|
|
|
|
|
Traditional
Operating Companies
|
|
|
|
|
|
$
|
(0.02)
|
|
Southern
Power
|
|
|
|
|
|
0.02
|
|
Parent Company and
Other
|
|
|
|
|
|
(0.03)
|
|
Total–As
Reported
|
|
|
|
|
|
$
|
(0.03)
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March
|
|
|
2016
|
|
2015
|
|
Change
|
Consolidated
Earnings Per Share–
|
|
|
|
|
|
|
Excluding Items
(See Notes)
|
|
$
|
0.58
|
|
|
$
|
0.56
|
|
|
$
|
0.02
|
|
|
|
|
|
|
|
|
Total–As
Reported
|
|
|
|
|
|
$
|
(0.03)
|
|
Estimated Loss on
Kemper IGCC
|
|
|
|
|
|
0.04
|
|
Acquisition
Costs
|
|
|
|
|
|
0.01
|
|
Total–Excluding Items
|
|
|
|
|
|
$
|
0.02
|
|
|
|
|
|
|
|
|
Notes
|
|
|
|
|
|
|
- For the three
months ended March 31, 2016 and 2015, dilution does not change
basic earnings per share by more than 1 cent and is not
material.
|
|
|
|
|
|
|
|
- The estimated
probable losses relating to Mississippi Power Company's
construction of the integrated coal
gasification combined cycle facility in Kemper County, Mississippi
(Kemper IGCC) significantly impacted the
presentation of earnings and earnings per share for the three
months ended March 31, 2016 and any similar charges may occur with
uncertain frequency.
|
|
|
|
|
|
|
|
- Earnings for the
three months ended March 31, 2016 include costs related to the
proposed acquisitions of AGL Resources Inc. and PowerSecure
International, Inc. Further costs are expected to continue to occur
in connection with closing the proposed acquisitions and supporting
the related integrations.
|
|
|
|
|
|
|
|
- All figures in this
earnings release are preliminary and remain subject to the
completion of normal quarter-end accounting procedures and
adjustments, which could result in changes to these preliminary
results. In addition, certain classifications and rounding may be
different from final results published in the Form 10-Q.
|
|
Southern
Company
|
|
EPS Earnings
Analysis
|
|
Three Months Ended
March 2016 vs. March 2015
|
|
|
Cents
|
Description
|
|
|
1¢
|
Retail
Sales
|
|
|
8
|
Retail Revenue
Impacts
|
|
|
(6)
|
Weather
|
|
|
(1)
|
Wholesale
Operations
|
|
|
1
|
Other Operating
Revenues
|
|
|
4
|
Non-Fuel
O&M
|
|
|
(3)
|
Depreciation and
Amortization
|
|
|
(1)
|
Other Income and
Deductions
|
|
|
(1)
|
Interest
Expense
|
|
|
2¢
|
Total Traditional
Operating Companies
|
|
|
2
|
Southern
Power
|
|
|
(2)
|
Parent and
Other
|
|
|
2¢
|
Total Change in
EPS (Excluding Items)
|
|
|
(4)
|
Estimated Loss on
Kemper IGCC
|
|
|
(1)
|
Acquisition
Costs
|
|
|
(3)¢
|
Total Change in
EPS (As Reported)
|
|
|
Notes
|
- The estimated
probable losses relating to Mississippi Power Company's
construction of the integrated coal
gasification combined
cycle facility in Kemper County, Mississippi (Kemper IGCC)
significantly impacted the
presentation of
earnings and earnings per share for the three months ended March
31, 2016 and any similar
charges may occur
with uncertain frequency.
|
|
|
- Earnings for the
three months ended March 31, 2016 include costs related to the
proposed acquisitions of AGL Resources Inc. and PowerSecure
International, Inc. Further costs are expected to continue to occur
in connection with closing the proposed acquisitions and supporting
the related integrations.
|
|
|
- All figures in this
earnings release are preliminary and remain subject to the
completion of normal quarter-end accounting procedures and
adjustments, which could result in changes to these preliminary
results. In addition, certain classifications and rounding may be
different from final results published in the Form 10-Q.
|
Southern
Company
|
Consolidated
Earnings
|
As
Reported
|
(In Millions of
Dollars)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March
|
|
|
2016
|
|
2015
|
|
Change
|
Income
Account-
|
|
|
|
|
|
|
Retail
Revenues-
|
|
|
|
|
|
|
Fuel
|
|
$
|
875
|
|
|
$
|
1,088
|
|
|
$
|
(213)
|
|
Non-Fuel
|
|
2,502
|
|
|
2,454
|
|
|
48
|
|
Wholesale
Revenues
|
|
396
|
|
|
467
|
|
|
(71)
|
|
Other Electric
Revenues
|
|
181
|
|
|
163
|
|
|
18
|
|
Other
Revenues
|
|
11
|
|
|
11
|
|
|
—
|
|
Total
Revenues
|
|
3,965
|
|
|
4,183
|
|
|
(218)
|
|
Fuel and Purchased
Power
|
|
1,076
|
|
|
1,356
|
|
|
(280)
|
|
Non-Fuel O &
M
|
|
1,109
|
|
|
1,122
|
|
|
(13)
|
|
Depreciation and
Amortization
|
|
541
|
|
|
487
|
|
|
54
|
|
Taxes Other Than
Income Taxes
|
|
256
|
|
|
252
|
|
|
4
|
|
Estimated Loss on
Kemper IGCC
|
|
53
|
|
|
9
|
|
|
44
|
|
Total Operating
Expenses
|
|
3,035
|
|
|
3,226
|
|
|
(191)
|
|
Operating
Income
|
|
930
|
|
|
957
|
|
|
(27)
|
|
Allowance for Equity
Funds Used During Construction
|
|
53
|
|
|
63
|
|
|
(10)
|
|
Interest Expense, Net
of Amounts Capitalized
|
|
246
|
|
|
213
|
|
|
33
|
|
Other Income
(Expense), net
|
|
(18)
|
|
|
(8)
|
|
|
(10)
|
|
Income
Taxes
|
|
222
|
|
|
274
|
|
|
(52)
|
|
Consolidated Net
Income
|
|
497
|
|
|
525
|
|
|
(28)
|
|
Less:
|
|
|
|
|
|
|
Dividends on
Preferred and Preference Stock of Subsidiaries
|
|
11
|
|
|
17
|
|
|
(6)
|
|
Net Income
Attributable to Noncontrolling Interests
|
|
1
|
|
|
—
|
|
|
1
|
|
CONSOLIDATED NET
INCOME ATTRIBUTABLE TO SOUTHERN COMPANY
|
|
$
|
485
|
|
|
$
|
508
|
|
|
$
|
(23)
|
|
|
|
|
|
|
|
|
Notes
|
|
|
|
|
|
|
- Certain prior year
data may have been reclassified to conform with current year
presentation.
|
|
|
|
|
|
|
|
- All figures in this
earnings release are preliminary and remain subject to the
completion of normal quarter-end accounting procedures and
adjustments, which could result in changes to these preliminary
results. In addition, certain classifications and rounding may be
different from final results published in the Form 10-Q.
|
Southern
Company
|
Kilowatt-Hour
Sales
|
(In Millions of
KWHs)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
March
|
As
Reported
|
|
2016
|
|
2015
|
|
Change
|
|
Weather Adjusted
Change*
|
Kilowatt-Hour
Sales-
|
|
|
|
|
|
|
|
|
Total
Sales
|
|
45,476
|
|
|
46,244
|
|
|
(1.7)
|
%
|
|
|
|
|
|
|
|
|
|
|
|
Total Retail
Sales-
|
|
38,038
|
|
|
39,209
|
|
|
(3.0)
|
%
|
|
0.4
|
%
|
Residential
|
|
12,602
|
|
|
13,577
|
|
|
(7.2)
|
%
|
|
1.4
|
%
|
Commercial
|
|
12,323
|
|
|
12,415
|
|
|
(0.7)
|
%
|
|
0.8
|
%
|
Industrial
|
|
12,888
|
|
|
12,988
|
|
|
(0.8)
|
%
|
|
(1.0)
|
%
|
Other
|
|
225
|
|
|
229
|
|
|
(1.7)
|
%
|
|
(1.5)
|
%
|
|
|
|
|
|
|
|
|
|
Total Wholesale
Sales
|
|
7,438
|
|
|
7,035
|
|
|
5.7
|
%
|
|
N/A
|
|
|
|
|
|
|
|
|
|
Note
|
|
|
|
|
|
|
|
|
*Also reflects
adjustment of 2015 KWH sales consistent with Mississippi Power's
updated methodology to estimate the unbilled revenue allocation
among customer classes implemented in the first quarter
2015.
|
Southern
Company
|
Financial
Overview
|
As
Reported
|
(In Millions of
Dollars)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
March
|
|
|
2016
|
|
2015
|
|
% Change
|
Consolidated
–
|
|
|
|
|
|
|
Operating
Revenues
|
|
$
|
3,965
|
|
|
$
|
4,183
|
|
|
(5.2)
|
%
|
Earnings Before
Income Taxes
|
|
719
|
|
|
799
|
|
|
(10.0)
|
%
|
Net Income Available
to Common
|
|
485
|
|
|
508
|
|
|
(4.5)
|
%
|
|
|
|
|
|
|
|
Alabama Power
–
|
|
|
|
|
|
|
Operating
Revenues
|
|
$
|
1,331
|
|
|
$
|
1,401
|
|
|
(5.0)
|
%
|
Earnings Before
Income Taxes
|
|
262
|
|
|
292
|
|
|
(10.3)
|
%
|
Net Income Available
to Common
|
|
155
|
|
|
169
|
|
|
(8.3)
|
%
|
|
|
|
|
|
|
|
Georgia Power
–
|
|
|
|
|
|
|
Operating
Revenues
|
|
$
|
1,872
|
|
|
$
|
1,978
|
|
|
(5.4)
|
%
|
Earnings Before
Income Taxes
|
|
432
|
|
|
380
|
|
|
13.7
|
%
|
Net Income Available
to Common
|
|
268
|
|
|
236
|
|
|
13.6
|
%
|
|
|
|
|
|
|
|
Gulf Power
–
|
|
|
|
|
|
|
Operating
Revenues
|
|
$
|
335
|
|
|
$
|
357
|
|
|
(6.2)
|
%
|
Earnings Before
Income Taxes
|
|
51
|
|
|
62
|
|
|
(17.7)
|
%
|
Net Income Available
to Common
|
|
29
|
|
|
37
|
|
|
(21.6)
|
%
|
|
|
|
|
|
|
|
Mississippi Power
–
|
|
|
|
|
|
|
Operating
Revenues
|
|
$
|
257
|
|
|
$
|
276
|
|
|
(6.9)
|
%
|
Earnings (Loss)
Before Income Taxes
|
|
1
|
|
|
39
|
|
|
(97.4)
|
%
|
Net Income (Loss)
Available to Common
|
|
11
|
|
|
35
|
|
|
(68.6)
|
%
|
|
|
|
|
|
|
|
Southern Power
–
|
|
|
|
|
|
|
Operating
Revenues
|
|
$
|
315
|
|
|
$
|
348
|
|
|
(9.5)
|
%
|
Earnings Before
Income Taxes
|
|
28
|
|
|
45
|
|
|
(37.8)
|
%
|
Net Income Available
to Common
|
|
50
|
|
|
33
|
|
|
51.5
|
%
|
|
|
|
|
|
|
|
Note
|
|
|
|
|
|
|
- All figures in this
earnings release are preliminary and remain subject to the
completion of normal quarter-end accounting procedures and
adjustments, which could result in changes to these preliminary
results. In addition, certain classifications and rounding may be
different from final results published in the Form 10-Q.
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SOURCE Southern Company