Dominion Announces Third-quarter 2012 Earnings

                Dominion Announces Third-quarter 2012 Earnings

-- Third-quarter 2012 operating earnings of 92 cents per share compared to
guidance of 90 cents to $1.00 per share

-- Third-quarter 2012 GAAP earnings of 36 cents per share

-- Conference call scheduled for 10 a.m. EDT today

PR Newswire

RICHMOND, Va., Oct. 25, 2012

RICHMOND, Va., Oct. 25, 2012 /PRNewswire/ --Dominion (NYSE: D) today
announced unaudited reported earnings determined in accordance with Generally
Accepted Accounting Principles (GAAP) for the three months ended Sept. 30,
2012, of $209 million ($0.36 per share), compared with reported earnings of
$392 million ($0.69 per share) for the same period in 2011. 

Operating earnings for the three months ended Sept. 30, 2012, amounted to $526
million ($0.92 per share), compared to original operating earnings of $541
million ($0.95 per share) for the same period in 2011. Operating earnings are
defined as reported (GAAP) earnings adjusted for certain items.

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 charges related to certain merchant generation plants, which have
been or are in the process of being sold or retired.

Business segment results and detailed descriptions of items included in 2012
and 2011 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 results came in toward the bottom of our guidance range of
$0.90 to $1.00 reflecting the effects of unplanned outages at Millstone Unit 2
and our Hastings Extraction Plant, lower results from Dominion Retail and
milder-than-normal weather in our electric service territory. We remain on
track to deliver weather-normalized 5 percent to 6 percent earnings per share
growth and continue to execute our long-term infrastructure growth plan.

"We recognized significant milestones associated with our growth plan this
quarter. At Dominion Energy, the Appalachian Gateway Project, which
transports natural gas produced in West Virginia and Pennsylvania, was placed
into service, on time and within budget. In addition, two projects providing
transportation services of Marcellus Shale volumes – Ellisburg to Craigs,with
capacity of 150,000 dekatherms per day, andNortheast Expansion, with capacity
of 200,000 dekatherms per day – are slated to be in-service in November, also
on schedule and within budget. Construction is well under way and we are
working towards a year-end in-service for Phase 1 of the Natrium natural gas
processing and fractionation plant, which is expected to provide enough
capacity to process 200 million cubic feet of natural gas per day and
fractionate 36,000 barrels of natural gas liquids per day.

"In our Generation segment, construction is well under way on the
1,329-megawatt, gas-fired power station in Warren County, Va. The
approximately $1.1 billion project is scheduled for completion in late 2014.
Plans are advancing on a similar-sized combined-cycle facility, the Brunswick
County Power Station. We recently executed an Engineering, Procurement and
Construction (EPC) agreement and plan to file for regulatory approval in the
fourth quarter with an expected commercial operation in 2016. The
coal-to-biomass conversions of Altavista, Southampton, and Hopewellare
proceeding on schedule and projected to come online by year end 2013. Also, we
recently filed an application with the Virginia State Corporation Commission
for a coal-to-natural gas conversion of our 227-megawatt Bremo Power Station.
Commercial operation is expected to commence in the summer of 2014, pending
regulatory approval."

Third-quarter 2012 operating earnings compared to 2011

The decrease in third-quarter 2012 operating earnings per share as compared to
original third-quarter 2011 operating earnings per share is primarily
attributable to milder-than-normal weather in our regulated electric service
territory and lower merchant margins. Positive factors for the quarter were
lower interest expenses and a lower effective tax rate.

Details of third-quarter 2012 operating earnings as compared to 2011 can be
found on Schedule 4 of this release.

Fourth-quarter, full-year 2012 and full-year 2013 operating earnings guidance

Dominion expects fourth-quarter 2012 operating earnings in the range of 65
cents per share to 75 cents per share as compared to original fourth-quarter
2011 operating earnings of 58 cents per share. Positive factors for the
fourth-quarter of 2012 compared to the same period of the prior year include
an expected return to normal weather in our electric service territory, higher
rate adjustment clause earnings and anticipated growth in our electric service
territory as well as higher revenues related to our growth projects. Negative
factors for the quarter include lower merchant generation margins and higher
operating expenses. GAAP earnings for the fourth quarter of 2011 were 35
cents per share. A reconciliation between original operating and GAAP
earnings for the fourth quarter of 2011 can be found on Schedule 3 of this
release.

Amounts for 2011 have been recast to reflect results for State Line and Salem
Harbor generating stations as discontinued operations. However, Dominion uses
original 2011 amounts prior to recast to calculate operating earnings growth
targets as well as for comparison to 2012 operating earnings and statistics.

In providing its fourth-quarter, full-year 2012 and full-year 2013 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,
if any, of these items on reported earnings, other than those as set forth on
Schedule 2 – Reconciliation of 2012 Operating Earnings to Reported Earnings on
page 8 of the 3Q12 Earnings Release Kit. Accordingly, the company is not able
to provide a corresponding GAAP equivalent for its operating earnings
guidance.

Conference call today

Dominion (NYSE:D) will host its third-quarter earnings conference call at 10
a.m. EDT on Thursday, Oct. 25. Dominion management will discuss its
third-quarter financial results and other matters of interest to the financial
community.

Domestic callers should dial (866) 710-0179. 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 the
Earnings Release Kit 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. EDT
Oct. 25 and lasting until 11 p.m. EDT November 1. Domestic callers may access
the recording by dialing (877) 919-4059. International callers should dial
(334) 323-7226. The PIN for the replay is 17770509. Additionally, a replay
of the webcast will be available on the company's investor information page by
the end of the day October 25.

Dominion is one of the nation's largest producers and transporters of energy,
with a portfolio of approximately 27,400 megawatts of generation, 11,000 miles
of natural gas transmission, gathering and storage pipeline and 6,300 miles of
electric transmission lines. Dominion operates the nation's largest natural
gas storage system with 947 billion cubic feet of storage capacity and serves
retail energy customers in 15 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 2012 and full-year 2013
which are 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 the electric industry, access to and costs of
capital, fluctuations in the value of our pension assets and assets held in
our decommissioning trusts, asset portfolio reviews and resulting decisions to
acquire, divest or retire assets, the receipt of regulatory approvals for, and
timing of, planned projects, acquisitions and divestitures, and the ability to
complete planned construction or expansion projects 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 and major storms on operations, the risk associated
with the operation of nuclear facilities, unplanned outages of Dominion's
generation facilities, state and federal legislative and regulatory
developments 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, 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,
changes in federal and state tax laws, 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 most recent quarterly report on Form 10-Q or
annual report on Form 10-K filed with the Securities and Exchange Commission.

Schedule 1 - Segment Operating Earnings
Preliminary, Unaudited
(millions, except earnings per    Three months ended September 30,
share)
                                  2012           2011*         Change
Earnings:
                                  $         $        $       
      Dominion Virginia Power                             
                                  119            125          (6)
      Dominion Energy             104            95            9
      Dominion Generation        363            394           (31)
      Corporate and Other         (60)           (73)          13
                                  $         $        $       
      OPERATING EARNINGS                                  
                                  526            541         (15)
      Items excluded from         (317)          (149)         (168)
      operating earnings^2, 3
                                  $         $        $       
      REPORTED EARNINGS ^1                               
                                  209            392         (183)
Common Shares Outstanding         574.7          571.2
(average, diluted)
Earnings Per Share (EPS):
                                  $         $        $       
      Dominion Virginia Power                           
                                  0.21           0.22         (0.01)
      Dominion Energy             0.18           0.17          0.01
      Dominion Generation        0.63           0.69          (0.06)
      Corporate and Other         (0.10)         (0.13)        0.03
                                  $         $        $       
      OPERATING EARNINGS                                
                                  0.92           0.95         (0.03)
      Items excluded from         (0.56)         (0.26)        (0.30)
      operating earnings^2
                                  $         $        $       
      REPORTED EARNINGS ^1                              
                                  0.36           0.69         (0.33)
(millions, except earnings per    Nine months ended September 30,
share)
                                  2012           2011*         Change
Earnings:
                                  $         $        $       
      Dominion Virginia Power                             
                                  428            389          39
      Dominion Energy             362            368           (6)
      Dominion Generation        737            886           (149)
      Corporate and Other         (178)          (223)         45
                                  $         $        $       
      OPERATING EARNINGS                                    
                                  1,349          1,420         (71)
      Items excluded from         (388)          (213)         (175)
      operating earnings^2, 4
                                  $         $        $       
      REPORTED EARNINGS ^1                                
                                  961           1,207         (246)
Common Shares Outstanding         573.2          575.6
(average, diluted)
Earnings Per Share (EPS):
                                  $         $        $       
      Dominion Virginia Power                            
                                  0.75           0.68         0.07
      Dominion Energy             0.63           0.64          (0.01)
      Dominion Generation        1.29           1.54          (0.25)
      Corporate and Other         (0.31)         (0.39)        0.08
                                  $         $        $       
      OPERATING EARNINGS                                
                                  2.36           2.47         (0.11)
      Items excluded from         (0.68)         (0.37)        (0.31)
      operating earnings^2
                                  $         $        $       
      REPORTED EARNINGS ^1                              
                                  1.68           2.10         (0.42)
1)    Determined in accordance with Generally Accepted Accounting Principles
      (GAAP).
      Items excluded from operating earnings are reported in Corporate and
2)    Other segment. Refer to Schedules 2 and 3 for details, or find "GAAP
      Reconciliation" on Dominion's website at www.dom.com/investors.
3)    Pre-tax amounts for the current period and the prior period are ($480)
      million and ($263) million, respectively.
4)    Pre-tax amounts for the current period and the prior period are ($596)
      million and ($350) million, respectively.
      Reflects amounts as originally reported prior to recast of results for
*     State Line and Salem Harbor generating stations as discontinued
      operations.

Schedule 2 - Reconciliation of 2012 Operating Earnings to Reported Earnings

2012 Earnings (nine months ended September 30, 2012) 

The net effects of the following items, all shown on an after-tax basis, are
included in 2012 reported earnings, but are excluded from operating earnings:

  o$297 million net loss, including impairment charges, primarily resulting
    from the planned shutdown of our Kewaunee nuclear merchant power station.
  o$45 million net loss from operations of Brayton Point, Kincaid, and Elwood
    fossil fuel-fired merchant power stations which Dominion decided to market
    for sale in the third quarter of 2012.
  o$42 million of restoration costs associated with summer storms that
    occurred in late June throughout the Dominion Virginia Power and Dominion
    North Carolina Power service territories.
  o$22 million net loss from discontinued operations of two merchant power
    stations (State Line and Salem Harbor) which were sold in 2012.
  o$9 million net gain related to our investments in nuclear decommissioning
    trust funds.
  o$9 million net benefit related to other items.

(millions, except per share amounts)       1Q12 2Q12   3Q12   4Q12 YTD 2012^2
Operating earnings                        $486  $337   $526        $1,349
Items excluded from operating earnings
(after-tax):
    Kewaunee                               2     (18)   (281)       (297)
    Brayton Point, Kincaid, Elwood                      (45)        (45)
    operations
    Late June summer storms                      (45)   3           (42)
    Discontinued operations - State Line & 1     (18)   (5)         (22)
    Salem Harbor
    Net gain in nuclear decommissioning    5     2      2           9
    trust funds
    Other                                               9           9
    Total items excluded from operating    8     (79)   (317)       (388)
    earnings (after-tax)^1
Reported net income                        $494  $258   $209        $961
Common shares outstanding (average,        571.9 573.1  574.7       573.2
diluted)
Operating earnings per share               $0.85 $0.59  $0.92       $2.36
Items excluded from operating earnings     0.01  (0.14) (0.56)      (0.68)
(after-tax)
Reported earnings per share                $0.86 $0.45  $0.36       $1.68
^1) Pre-tax amounts for items excluded from operating earnings are reflected
    in the following table:
    Items excluded from operating          1Q12 2Q12   3Q12   4Q12 YTD 2012
    earnings:
    Kewaunee                               3     (26)   (435)       (458)
    Brayton Point, Kincaid, Elwood                      (34)        (34)
    operations
    Late June summer storms                      (74)   5           (69)
    Discontinued operations - State Line & 2     (32)   (19)        (49)
    Salem Harbor
    Net gain in nuclear decommissioning    8     3      3           14
    trust funds
    Total items excluded from operating    $13   ($129) ($480)      ($596)
    earnings
^2) YTD 2012 EPS may not equal sum of quarters due to share count
    differences.



Schedule 3 - Reconciliation of 2011 Original Operating Earnings to Reported
Earnings

2011 Earnings (Twelve months ended December 31, 2011) ^3

The net effects of the following items, all shown on an after-tax basis, are
included in 2011 reported earnings, but are excluded from operating earnings:

  o$178 million of impairment charges related to certain utility ($139
    million) and merchant ($39 million) coal-fired power stations.
  o$59 million of restoration costs associated with Hurricane Irene.
  o$39 million net loss from operations at our Kewaunee nuclear merchant
    power station.
  o$34 million impairment of excess emission allowances resulting from a new
    EPA air pollution rule.
  o$21 million of severance costs and other charges related to our State Line
    and Salem Harbor merchant power stations.
  o$19 million net charge in connection with the Virginia Commission's final
    ruling associated with its biennial review of Virginia Power's base rates
    for 2009-2010 test years.
  o$13 million of earthquake related costs, largely related to inspections
    following the safe shutdown of reactors at our North Anna nuclear power
    station.
  o$14 million benefit related to litigation with the Department of Energy
    for spent nuclear fuel-related costs at Millstone nuclear power station.
  o$3 million net benefit related to other items.

(millions, except per share    1Q11      2Q11      3Q11     4Q11    YTD
amounts)                                                            2011^2
Operating earnings             $541      $338      $541     $334    $1,754
Items excluded from operating
earnings (after-tax):
    Impairment of generation   (39)                         (139)   (178)
    assets
    Hurricane Irene costs                          (74)     15      (59)
    Kewaunee operations       (19)      (1)       (12)     (7)     (39)
    Emission allowances                            (34)             (34)
    impairments
    Charges related to State
    Line & Salem Harbor                  (11)      (10)             (21)
    operations
    Impact of Virginia Power                                (19)    (19)
    biennial review order
    Earthquake costs                               (13)             (13)
    Recoverable spent nuclear            14                         14
    fuel-related costs
    Other items                (4)       (4)       (6)      17      3
    Total items excluded from
    operating earnings         (62)      (2)       (149)    (133)   (346)
    (after-tax) ^1
Reported net income            $479      $336      $392     $201    $1,408
Common shares outstanding      580.5     575.2     571.2    571.2   574.6
(average, diluted)
Operating earnings per share   $0.93     $0.59     $0.95    $0.58   $3.05
Items excluded from operating  (0.11)    (0.01)    (0.26)   (0.23)  (0.60)
earnings (after-tax)
Reported earnings per share    $0.82     $0.58     $0.69    $0.35   $2.45
^1) Pre-tax amounts for items excluded from operating earnings are reflected
    in the following table:
    Items excluded from        1Q11      2Q11      3Q11     4Q11    YTD 2011
    operating earnings:
    Impairment of generation   (55)                         (228)   (283)
    assets
    Hurricane Irene costs                          (121)    25      (96)
    Kewaunee operations       (32)      (5)       (19)     (10)    (66)
    Emission allowances                            (57)             (57)
    impairments
    Charges related to State
    Line & Salem Harbor                  (17)      (16)             (33)
    operations
    Impact of Virginia Power                                (31)    (31)
    biennial review order
    Earthquake costs                               (21)             (21)
    Recoverable spent nuclear            24                         24
    fuel-related costs
    Other items                6         (8)       (29)     (11)    (42)
    Total items excluded from  ($81)     ($6)      ($263)   ($255)  ($605)
    operating earnings
^2) YTD 2011 EPS may not equal sum of quarters due to share count
    differences.
^3) Reflects amounts as originally reported prior to recast of results for
    State Line and Salem Harbor generating stations as discontinued
   operations.



Schedule 4 - Reconciliation of 3Q12 Earnings to 3Q11
Preliminary, unaudited                        Three Months Ended
(millions, except EPS)                        September 30,
                                              2012 vs. 2011^1
                                              Increase / (Decrease)
Reconciling Items                             Amount           EPS
Dominion Virginia Power
    Regulated electric sales:
    Weather                                   ($11)            ($0.02)
    Other                                     7                0.01
    FERC Transmission equity return           3                0.01
    Retail energy marketing operations        (6)              (0.01)
    Storm damage and service restoration      2                0.00
    Other                                     (1)              0.00
    Share accretion                           ---              0.00
    Change in contribution to operating       ($6)             ($0.01)
    earnings
Dominion Energy^
    Gas Distribution weather                  1                0.00
    Producer Services margin                  7                0.01
    Other                                     1                0.00
    Share accretion                           ---              0.00
    Change in contribution to operating       $9               $0.01
    earnings
Dominion Generation
    Regulated electric sales:
    Weather                                   ($29)            ($0.05)
    Other                                     19               0.03
    Merchant generation margin                (20)             (0.04)
    Brayton Point, Kincaid and Elwood 2011    (9)              (0.02)
    earnings
    State Line and Salem Harbor 2011 earnings (14)             (0.03)
    Rate adjustment clause equity return      6                0.01
    PJM ancillary services                    (3)              (0.01)
    Net capacity expenses                     3                0.01
    Outage costs                              5                0.01
    Other                                     11               0.02
    Share accretion                           ---              0.01
    Change in contribution to operating       ($31)            ($0.06)
    earnings
Corporate and Other
    Change in contribution to operating       $13              $0.03
    earnings
Change in consolidated operating earnings    ($15)            ($0.03)
Change in items excluded from operating       ($168)           ($0.30)
earnings^2
Change in reported earnings (GAAP)            ($183)           ($0.33)
^1) Reflects 2011 amounts prior to recast of operating results of State Line
    and Salem Harbor generating stations as discontinued operations.

^2) Refer to Schedules 2 and 3 for details of items excluded from operating
    earnings, or find "GAAP Reconciliation" on Dominion's website at
   www.dom.com/investors. 



SOURCE Dominion

Website: http://www.dom.com
Contact: Media - Ryan Frazier, +1-804-819-2521, C.Ryan.Frazier@dom.com;
Analysts - Nathan Frost, +1-804-819-2187, Nathan.J.Frost@dom.com