Results include discontinued
operations
TECO Energy, Inc. (NYSE:TE) today reported second-quarter 2015
net income of $11.8 million, or $0.05 per share, compared with
$58.4 million, or $0.27 per share, in the second quarter of 2014.
As previously reported on July 30, net income from continuing
operations was $61.5 million, or $0.26 per share, in the 2015
second quarter, compared with $57.6 million, or $0.27 per share,
for the same period in 2014. The $49.7 million loss in discontinued
operations in the second quarter reflects the operating results at
TECO Coal of $1.1 million and net impairment charges of $50.8
million associated with the pending sale of TECO Coal (see the
Discontinued Operations section below).
Year-to-date net income was $69.8 million, or $0.30 per share,
compared with net income of $108.5 million, or $0.50 per share in
the 2014 period. Net income from continuing operations was $125.3
million or $0.53 per share, compared with $106.0 million or $0.49
per share in the 2014 period. The $55.5 million loss in
discontinued operations in the year-to-date period reflects the
$4.7 million operating loss at TECO Coal and net impairment charges
referred to above.
The information in this release should be used in conjunction
with the information in the TECO Energy press release and Current
Report on Form 8-K dated July 30, 2015 for a complete understanding
of TECO Energy’s second quarter and year-to-date 2015 financial
results.
Segment Reporting
The table below includes TECO Energy segment information on a
GAAP basis, which includes all charges and gains for the periods
shown.
Segment
Information
3 months
ended June 30
6 months
ended June 30
12 months
ended June 30
(millions)
Net Income Summary
2015 2014
2015 2014
2015 2014 Tampa
Electric $67.7 $62.2 $115.9 $107.4 $233.1
$215.9 Peoples Gas System 7.6 7.5 22.2 22.1 35.8 35.1 New Mexico
Gas Co.(1) (0.1) -- 13.8 -- 24.3 -- Other – net (13.7)
(12.1) (26.6) (23.5) (67.5) (45.3) Net
income from continuing operations 61.5 57.6 125.3 106.0 225.7 205.7
Discontinued operations (2) (49.7) 0.8 (55.5)
2.5 (134.0) 7.5 Total net income $11.8 $58.4
$69.8 $108.5 $91.7 $ 213.2
(1) The 12-months ended 2015 period reflect
New Mexico Gas Co. results after the Sept. 2, 2014 closing of the
acquisition.
(2) In the three- and six-months ended 2015
periods, discontinued operations include the operating results at
TECO Coal and an impairment charge. In the 12-months ended 2015
period, discontinued operations included the operating results at
TECO Coal, net impairment charges, and costs related to TECO
Guatemala. In the three-, six- and 12-months ended 2014 periods,
discontinued operations included the operating results at TECO
Coal. The six- and 12-month ended 2014 periods included a $3.1
million benefit related to the sale of TECO Guatemala in 2012.
Discontinued Operations
The second quarter 2015 loss of $49.7 million recorded in
discontinued operations reflects TECO Coal’s second quarter
operating results of $1.1 million and net impairment charges of
$50.8 million associated with the pending sale of TECO Coal. The
company continues to be in active discussions with interested
parties in an effort to complete the sale. Based on management’s
assessment of current market conditions and the discussions with
interested parties, an additional impairment charge was recorded in
the second quarter of 2015, which includes the estimated selling
costs associated with this transaction.
The year-to-date loss of $55.5 million in discontinued
operations reflects TECO Coal’s operating loss of $4.7 million and
the net impairment charges recorded in the second quarter.
TECO Energy Inc. (NYSE: TE) is an energy-related holding company
with regulated electric and gas utilities in Florida and New
Mexico. Tampa Electric serves more than 700,000 customers in West
Central Florida; Peoples Gas System serves more than 350,000
customers across Florida; and New Mexico Gas Co. serves more than
510,000 customers across New Mexico. Other TECO Energy subsidiaries
include TECO Coal, which owns and operates coal-production
facilities in Kentucky, Tennessee and Virginia.
Note: This press release may be deemed to contain
forward-looking statements, which are subject to the inherent
uncertainties in predicting future results and conditions. Actual
results may differ materially from those forecasted. The forecasted
results are based on the company's current expectations and
assumptions, and the company does not undertake to update that
information or any other information contained in this press
release, except as may be required by law. Factors that could
impact actual results include: regulatory actions by federal, state
or local authorities; the ability to successfully implement the
integration plans for NMGC and generate the financial results to
make the acquisition accretive; unexpected capital needs or
unanticipated reductions in cash flow that affect liquidity; the
ability to access the capital and credit markets when required;
general economic conditions affecting customer growth and energy
sales at the utility companies; economic conditions affecting the
Florida and New Mexico economies; weather variations and customer
energy usage patterns affecting sales and operating costs at the
utilities and the effect of weather conditions on energy
consumption; the effect of extreme weather conditions or
hurricanes; general operating conditions; input commodity prices
affecting cost at all of the operating companies; natural gas
demand at the utilities; and the ability of TECO Energy's
subsidiaries to operate equipment without undue accidents,
breakdowns or failures; and the ability of TECO Energy to
successfully close the sale of TECO Coal on reasonable terms, or
otherwise exit the coal business. Additional information is
contained under "Risk Factors" in TECO Energy, Inc.'s Annual Report
on Form 10-K for the period ended Dec. 31, 2014.
Summary Information (as of June 30,
2015)
(millions except per share amounts)
Three Months
Six Months Twelve Months Ended
Ended Ended 2015
2014 2015 2014
2015 2014 Revenues $680.6 $605.7
$1,373.6 $1,183.7 $2,756.3 $2,388.1 Net income
from continuing operations
$61.5
$57.6
$125.3
$106.0
$225.7
$205.7
Net income from discontinued operations
(49.7)
0.8
(55.5)
2.5
(134.0)
7.5
Net income $11.8 $58.4 $69.8 $108.5
$91.7 $213.2 Earnings per share from continuing
operations- basic
$0.26
$0.27
$0.53
$0.49
$0.97
$0.96
Earnings per share from discontinued operations – basic (0.21)
--
(0.23)
0.01
(0.58)
0.03
Total earnings per share – basic $0.05 $0.27 $0.30
$0.50 $0.39 $0.99 Total earnings per
share – diluted
$0.05
$0.27
$0.30
$0.50
$0.39
$0.99
Average common shares outstanding – basic
233.0
215.4
232.9
215.3
231.3
215.2
Average common shares outstanding – diluted
233.6
215.9
233.5
215.8
231.9
215.7
JUNE 2015
Figures appearing in these statements are presented as general
information and not in connection with any sale or offer to sell or
solicitation of an offer to buy any securities, nor are they
intended as a representation by the company of the value of its
securities. All figures reported are subject to adjustments as the
annual audit by independent accountants may determine to be
necessary and to the explanatory notes affecting income and balance
sheet accounts contained in the company’s Annual Report on Form
10-K. Reference should also be made to information contained in
that and other reports filed by TECO Energy, Inc. and Tampa
Electric Company with the Securities and Exchange Commission.
TECO ENERGY, Inc. CONSOLIDATED STATEMENTS OF INCOME
(Unaudited) (All significant intercompany transactions have
been eliminated in the consolidated financial statements.)
Three
Months Ended Six Months Ended Twelve Months Ended
Jun. 30, Jun. 30, Jun. 30, (millions except share
data)
2015 2014
2015 2014
2015
2014
Revenues Regulated electric and
gas
$678.2 $603.6
$1,368.1 $1,179.3
$2,746.1
$2,378.8 Unregulated
2.4 2.1
5.5 4.4
10.2
9.3 Total revenues
680.6 605.7
1,373.6 1,183.7
2,756.3 2,388.1
Expenses Regulated operations
& maintenance Fuel
171.8 169.7
315.9 319.3
689.0 685.0 Purchased power
19.6 19.9
36.7
38.1
69.9 67.7 Cost of natural gas sold
49.1 29.1
152.1 76.2
285.6 128.1 Other
155.4 126.8
299.1 247.4
599.4 521.4 Operations & maintenance
other expense
1.1 4.6
2.7 7.8
24.5 15.7
Depreciation and amortization
87.0 75.5
172.5 151.4
336.4 296.5 Taxes, other than income
53.3
48.1
105.1 95.9
204.2 189.4 Total expenses
537.3 473.7
1,084.1
936.1
2,209.0 1,903.8
Income from operations 143.3 132.0
289.5 247.6
547.3 484.3
Other income (expense) Allowance
for other funds used during construction
3.7 2.0
7.5
4.4
13.6 8.2 Other income
1.4 (0.5)
3.0 (1.4)
5.0 (2.5) Total other income
5.1
1.5
10.5 3.0
18.6 5.7
Interest charges Interest
expense
48.2 41.4
98.0 82.4
192.0 164.2
Allowance for borrowed funds used during construction
(1.8) (0.7)
(3.7)
(2.1)
(6.8) (4.3) Total interest
charges
46.4 40.7
94.3 80.3
185.2
159.9
Income before provision for income taxes 102.0
92.8
205.7 170.3
380.7 330.1 Provision for income
taxes
40.5 35.2
80.4 64.3
155.0
124.4
Income from continuing operations 61.5 57.6
125.3 106.0
225.7 205.7
Discontinued
operations Income (loss) from discontinued operations
(78.1) 0.0
(87.7) 1.2
(214.3) 3.4 Provision
for income taxes
(28.4) (0.8)
(32.2) (1.3)
(80.3) (4.1) Income (loss) from discontinued
operations, net
(49.7) 0.8
(55.5) 2.5
(134.0)
7.5
Net income $11.8 $58.4
$69.8 $108.5
$91.7 $213.2
Average common
shares outstanding - basic (millions) 233.0 215.4
232.9 215.3
231.3 215.2
Average common shares
outstanding - diluted (millions) 233.6 215.9
233.5 215.8
231.9 215.7
Earnings per
average common share outstanding: Earnings per share from
continuing operations -- basic
$0.26 $0.27
$0.53
$0.49
$0.97 $0.96 Earnings per share from continuing
operations -- diluted
$0.26 $0.27
$0.53 $0.49
$0.97 $0.96 Earnings per share from discontinued
operations -- basic
($0.21) $0.00
($0.23) $0.01
($0.58) $0.03 Earnings per share from discontinued
operations -- diluted
($0.21) $0.00
($0.23) $0.01
($0.58) $0.03 Earnings per share attributable to TECO
Energy -- basic
$0.05 $0.27
$0.30 $0.50
$0.39
$0.99 Earnings per share attributable to TECO Energy -- diluted
$0.05 $0.27
$0.30 $0.50
$0.39 $0.99
TECO
ENERGY, Inc. CONSOLIDATED BALANCE SHEETS (Unaudited)
(All significant intercompany transactions have been eliminated in
the consolidated financial statements.)
Jun. 30, Dec. 31, (millions)
2015 2014
Assets Current assets
Cash and cash equivalents
$56.0 $25.4 Receivables
273.3 299.8 Inventories at average cost Fuel
132.7
96.4 Materials and supplies
75.8 75.4 Derivative assets
0.6 0.0 Deferred income taxes
73.4 72.8 Prepayments
and other current assets
31.5 22.6 Regulatory assets
39.4 53.6 Assets held for sale
96.5
109.6 Total current assets
779.2 755.6
Property, plant and equipment Utility plant in service
Electric
7,217.1 7,094.8 Gas
2,055.2 1,984.6
Construction work in progress
648.0 640.0 Other property
14.8 14.5 Property plant and equipment at
original cost
9,935.1 9,733.9 Accumulated depreciation
(2,693.4) (2,645.7) Total property, plant and
equipment, net
7,241.7 7,088.2
Other
assets Regulatory assets
343.3 348.5 Goodwill
408.4 408.3 Deferred charges and other assets
65.8
65.8 Assets held for sale
0.0 59.8 Total other
assets
817.5 882.4
Total assets
$8,838.4 $8,726.2
Liabilities and
capital Current liabilities Long-term debt due within one year
$333.3 $274.5 Notes payable
85.5 139.0 Accounts
payable
258.2 288.6 Other current liabilities
16.7
16.8 Customer deposits
179.5 176.2 Derivative liabilities
24.4 36.6 Interest accrued
38.1 39.9 Taxes accrued
46.0 29.9 Regulatory liabilities
49.9 57.0
Liabilities associated with assets held for sale
30.2
39.4 Total current liabilities
1,061.8
1,097.9
Other liabilities Deferred income taxes
573.1
519.2 Investment tax credits
8.8 9.0 Regulatory liabilities
713.2 729.0 Derivative liabilities
1.9 6.1 Deferred
credits and other liabilities
341.5 370.9 Liabilities
associated with assets held for sale
66.3 65.4 Long-term
debt, less amount due within one year
3,518.5
3,354.0 Total other liabilities
5,223.3
5,053.6
Total liabilities 6,285.1 6,151.5
Capital Common equity
235.1 234.9 Additional paid in
capital
1,885.7 1,875.9 Retained earnings
443.5 479.6
Accumulated other comprehensive loss
(11.0)
(15.7) Total capital
2,553.3 2,574.7
Total
liabilities and capital $8,838.4
$8,726.2 Book Value Per Share $10.86
$10.96
TECO ENERGY, Inc. CONSOLIDATED STATEMENTS OF CASH
FLOWS (Unaudited) (All significant intercompany transactions
have been eliminated in the consolidated financial statements.)
Three Months Ended Six Months Ended Twelve Months Ended Jun.
30, Jun. 30, Jun. 30, (millions)
2015 2014
2015 2014
2015 2014
Cash flows from operating
activities Net income
$11.8 $58.4
$69.8 $108.5
$91.7 $213.2 Adjustments to reconcile net income to
net cash from operating activities: Depreciation and amortization
87.4 84.2
173.3 169.1
346.0 332.7 Deferred
income taxes & Investment tax credits
10.9 33.0
46.9 61.8
74.6 120.1 Allowance for other funds used
during construction
(3.7) (2.0)
(7.5) (4.4)
(13.6) (8.2) Non-cash stock compensation
3.0 3.4
6.9 7.1
12.6 13.7 Gain on sales of business / assets,
pretax
0.0 0.0
0.0 (0.1)
(0.1) (1.5) Deferred
recovery clause
1.6 (17.0)
(4.1) (14.4)
(5.0)
(14.6) Asset impairment, pretax
78.6 0.0
78.6 0.0
194.5 0.0 Receivables, less allowance for uncollectibles
(11.2) (54.7)
39.8 (36.6)
39.9 (2.7)
Inventories
(21.5) (16.6)
(37.2) (16.2)
(8.2)
4.6 Prepayments and other current assets
(1.3) (1.9)
(12.2) (2.1)
(7.2) 0.0 Taxes accrued
17.3 18.8
19.0 34.3
(14.1) 7.5 Interest accrued
(19.6)
(20.4)
(1.8) 2.5
3.0 (0.8) Accounts payable
5.2 (10.8)
(58.3) (36.0)
1.1 (13.0) Other
(8.7) (0.3)
(16.4)
(12.5)
(14.5) (19.1)
149.8 74.1
296.8 261.0
700.7
631.9
Cash flows from investing activities Capital
expenditures
(183.2) (184.0)
(343.2) (320.3)
(737.3) (603.1) Allowance for other funds used during
construction
3.7 2.0
7.5 4.4
13.6 8.2 Purchase
of a business, net of cash acquired
0.0 0.0
0.0 0.0
(751.5) 0.0 Net proceeds from sale of business / assets
0.1 0.1
0.0 0.3
0.0 4.2 Other investments
0.0 0.0
(0.1)
0.0
(8.1) 0.0
(179.4) (181.9)
(335.8) (315.6)
(1,483.3)
(590.7)
Cash flows from financing activities
Dividends paid
(52.9) (47.9)
(105.9) (95.9)
(209.2) (191.5) Proceeds from sale of common stock
0.7 1.4
3.5 3.0
302.9 2.3 Proceeds from
long-term debt
500.0 296.6
500.0 296.6
766.9
296.6 Repayment of long-term debt / Purchase in lieu of redemption
(274.5) (83.3)
(274.5) (83.3)
(274.5) (134.9)
Net (decrease) increase in short-term debt
(120.5)
(29.0)
(53.5) (84.0)
85.5 0.0
52.8 137.8
69.6
36.4
671.6 (27.5) Net
increase (decrease) in cash and cash equivalents
23.2 30.0
30.6 (18.2)
(111.0) 13.7 Cash and cash equivalents at
beginning of period
32.8 137.0
25.4 185.2
167.0
153.3 Cash and cash equivalents at end of period
$56.0 $167.0
$56.0
$167.0
$56.0 $167.0
Supplemental disclosure of non-cash activities Debt
assumed in NMGI acquisition
$0.0 $0.0
$0.0 $0.0
$200.0 0.0 Change in accrued capital expenditures - excluded
above
($9.9) ($6.1)
$1.6 $8.6
$6.5 $16.3
TECO ENERGY, Inc. SEGMENT INFORMATION (Unaudited)
(millions)
Tampa
Peoples TECO TECO
Electric Gas
Coal (3) NMGC
Other (3) Eliminations
Energy Three months ended Jun. 30, 2015
Revenues - outsiders $ 531.6 $ 92.2 $ -- $ 54.0 $ 2.8 $ -- $ 680.6
Sales to affiliates 0.8
1.3 --
-- 0.1
(2.2 ) -- Total
revenues 532.4 93.5 -- 54.0 2.9 (2.2 ) 680.6 Depreciation and
amortization 64.0 14.0 -- 8.4 0.6 -- 87.0 Total interest charges
(2) 23.6 3.6 -- 3.3 16.3 (0.4 ) 46.4 Allocated interest expense (2)
-- -- -- -- 0.4 (0.4 ) -- Provision (Benefit) for income taxes 38.9
4.8 -- -- (3.2 ) -- 40.5 Net income (loss) from continuing
operations 67.7 7.6 -- (0.1 ) (13.7 ) -- 61.5 Income (loss) from
discontinued operations, net of tax -- -- (51.5 ) -- 1.8 -- (49.7 )
Net income (loss) (1) $ 67.7
$ 7.6 $ (51.5 ) $
(0.1 ) $ (11.9 ) $ --
$ 11.8
2014 Revenues - outsiders $
512.5 $ 90.7 $ -- $ -- $ 2.5 $ -- $ 605.7 Sales to affiliates
0.2 0.4
-- --
0.1 (0.7 )
-- Total revenues 512.7 91.1 --
-- 2.6 (0.7 ) 605.7 Depreciation and amortization 61.7 13.4 -- --
0.4 -- 75.5 Total interest charges (2) 23.3 3.4 -- -- 15.9 (1.9 )
40.7 Allocated interest expense (2) -- -- -- -- 1.9 (1.9 ) --
Provision (Benefit) for income taxes 37.1 4.8 -- -- (6.7 ) -- 35.2
Net income (loss) from continuing operations 62.2 7.5 -- -- (12.1 )
-- 57.6 Income (loss) from discontinued operations, net of tax --
-- 0.8 -- -- -- 0.8 Net income (loss) (1) $
62.2 $ 7.5 $ 0.8
$ -- $ (12.1 )
$ -- $ 58.4
Six months ended Jun.
30, 2015 Revenues - outsiders $ 981.4 $ 213.9 $ -- $
173.0 $ 5.3 $ -- $ 1,373.6 Sales to affiliates 1.6
2.5 --
--
0.1 (4.2 )
-- Total revenues 983.0 216.4 -- 173.0 5.4 (4.2 )
1,373.6 Depreciation and amortization 126.9 27.9 -- 16.8 0.9 --
172.5 Total interest charges (2) 47.1 7.1 -- 6.6 34.2 (0.7 ) 94.3
Allocated interest expense (2) -- -- -- -- 0.7 (0.7 ) -- Provision
(Benefit) for income taxes 66.3 14.0 -- 9.0 (8.9 ) -- 80.4 Income
from continuing operations 115.9 22.2 -- 13.8 (26.6 ) -- 125.3
Income (loss) from discontinued operations, net of tax -- -- (57.5
) -- 2.0 -- (55.5 ) Net income (loss) (1) $
115.9 $ 22.2 $ (57.5 )
$ 13.8 $ (24.6 )
$ -- $ 69.8
2014
Revenues - outsiders $ 965.4 $ 213.1 $ -- $ -- $ 5.2 $ -- $ 1,183.7
Sales to affiliates 0.5
0.6 --
-- 0.1
(1.2 ) -- Total
revenues 965.9 213.7 -- -- 5.3 (1.2 ) 1,183.7 Depreciation and
amortization 123.8 26.7 -- -- 0.9 -- 151.4 Total interest charges
(2) 45.3 6.8 -- -- 31.9 (3.7 ) 80.3 Allocated interest expense (2)
-- -- -- -- 3.7 (3.7 ) -- Provision (Benefit) for income taxes 63.7
14.0 -- -- (13.4 ) -- 64.3 Income from continuing operations 107.4
22.1 -- -- (23.5 ) -- 106.0 Income (loss) from discontinued
operations, net of tax -- -- (0.8 ) -- 3.3 -- 2.5 Net
income (loss) (1) $ 107.4 $ 22.1
$ (0.8 ) $ -- $
(20.2 ) $ -- $ 108.5
Twelve months ended Jun. 30, 2015 Revenues -
outsiders $ 2,036.0 $ 399.3 $ -- $ 310.6 $ 10.4 $ -- $ 2,756.3
Sales to affiliates 2.1
3.0 --
-- 0.3
(5.4 ) -- Total
revenues 2,038.1 402.3 -- 310.6 10.7 (5.4 ) 2,756.3 Depreciation
and amortization 251.7 55.2 -- 27.8 1.7 -- 336.4 Total interest
charges (2) 94.6 14.1 -- 10.8 68.4 (2.7 ) 185.2 Allocated interest
expense (2) -- -- -- -- 1.3 (1.3 ) -- Provision (Benefit) for
income taxes 135.8 22.7 -- 16.0 (19.5 ) -- 155.0 Net income (loss)
from continuing operations 233.1 35.8 -- 24.3 (67.5 ) -- 225.7
Income (loss) from discontinued operations, net of tax -- -- (138.7
) -- 4.7 -- (134.0 ) Net income (loss) (1) $
233.1 $ 35.8 $ (138.7 )
$ 24.3 $ (62.8 )
$ -- $ 91.7
2014
Revenues - outsiders $ 1,994.5 $ 382.6 $ -- $ -- $ 11.0 $ -- $
2,388.1 Sales to affiliates 1.0
0.9 --
-- 0.2
(2.1 ) --
Total revenues 1,995.5 383.5 -- -- 11.2 (2.1 ) 2,388.1 Depreciation
and amortization 242.9 52.0 -- -- 1.6 -- 296.5 Total interest
charges (2) 90.4 13.6 -- -- 63.4 (7.5 ) 159.9 Allocated interest
expense (2) -- -- -- -- 7.5 (7.5 ) -- Provision (Benefit) for
income taxes 129.4 22.2 -- -- (27.2 ) -- 124.4 Net income (loss)
from continuing operations 215.9 35.1 -- -- (45.3 ) -- 205.7 Income
(loss) from discontinued operations, net of tax -- -- 4.5 -- 3.0 --
7.5 Net income (loss) (1) $ 215.9
$ 35.1 $ 4.5
$ -- $ (42.3 ) $
-- $ 213.2
(1)
Results are based on GAAP net income. For a complete reconciliation
between GAAP and non-GAAP items, see Results Reconciliation in
Earnings Release.
(2)
Segment net income is reported on a basis that includes internally
allocated financing costs. Internally allocated costs were at
pretax rates of 6.00% for July 2013 through June 2015.
(3)
All periods have been adjusted to reflect the reclassification of
results from operations to discontinued operations for TECO
Guatemala, TECO Coal, and certain charges at Parent that directly
relate to TECO Guatemala or TECO Coal.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150805006385/en/
TECO Energy, Inc.News Media:Sylvia Vega, 813-228-4381orInvestor
Relations:Mark Kane, 813-228-1772Internet:
http://www.tecoenergy.com
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