Southern Company third quarter earnings reflect mild weather, uncertain economy

   Southern Company third quarter earnings reflect mild weather, uncertain
                                   economy

PR Newswire

ATLANTA, Nov. 5, 2012

ATLANTA, Nov. 5, 2012 /PRNewswire/ -- Southern Company (NYSE: SO) today
reported third quarter earnings of $976 million, or $1.11 a share, compared
with $916 million, or $1.07 a share, for the same period a year ago.

For the nine months ended Sept. 30, 2012, Southern Company's earnings were
$1.97 billion, or $2.26 a share, compared with $1.94 billion, or $2.27 a
share, for the same period a year ago.

Earnings for the nine months ended Sept. 30, 2012, included 2 cents a share of
insurance recovery related to the March 2009 settlement agreement with MC
Asset Recovery, LLC to resolve a lawsuit arising out of the 2003 bankruptcy of
Mirant Corp., a Southern Company subsidiary until its 2001 spinoff. Excluding
the impact of that recovery, Southern Company earned $2.24 a share for the
first nine months of 2012, compared with $2.27 a share for the first nine
months of 2011.

Operating revenues for the third quarter of 2012 were $5.05 billion, compared
with $5.43 billion for the same period a year ago, a 7.0 percent decrease. For
the first nine months of 2012, operating revenues were $12.83 billion,
compared with $13.96 billion for the same period last year, an 8.1 percent
decrease. The third quarter and year-to-date decreases were primarily due to
lower fuel costs that were passed through to customers.

Earnings for the third quarter of 2012 were negatively influenced by
milder-than-normal weather as compared to warmer-than-normal weather for the
same period in 2011. This effect was offset by reductions in non-fuel
operations and maintenance expenses and by other revenue effects across the
company's traditional operating units.

"After a promising first six months of 2012, the economy has slowed due to
uncertainty around the elections, the fiscal cliff and the slowing world
economy," said Thomas A. Fanning, Southern Company chairman, president and
CEO. "Until these issues are resolved, the near-term outlook for the national
economy will be unclear. We continue to believe that the long-term prospects
for the Southeast remain strong relative to other portions of the country."

Retail kilowatt-hour sales in Southern Company's four-state service territory
decreased 4.0 percent in the third quarter of 2012 compared with the third
quarter of 2011. Residential and commercial sales – which were affected by
milder weather during the third quarter of 2012 compared to the third quarter
of 2011 – decreased 7.2 percent and 2.4 percent, respectively, while
industrial sales decreased 1.9 percent.

For the year to date, kilowatt-hour sales to retail customers decreased 3.7
percent compared with the same period a year ago. Residential sales decreased
8.3 percent, commercial sales decreased 2.3 percent and industrial sales
decreased 0.1 percent.

Total energy sales to Southern Company's customers in the Southeast, including
wholesale sales, decreased 4.9 percent in the third quarter of 2012 compared
with the same period in 2011. On a year-to-date basis, total energy sales
decreased 5.0 percent compared with the same period in 2011.

Southern Company's financial analyst call will begin at 11 a.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/events.cfm. A replay of the webcast
only will be available at the site for 12 months.

Southern Company has also posted on its website detailed financial information
on its third quarter performance. These materials are available at
www.southerncompany.com.

With 4.4 million customers and more than 43,000 megawatts of generating
capacity, Atlanta-based Southern Company (NYSE: SO) is the premier energy
company serving the Southeast. 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
energy innovation, excellent customer service, high reliability and retail
electric prices that are below the national average. Southern Company is
leading the nation's nuclear renaissance through the construction of the first
new nuclear units to be built in a generation of Americans and is
demonstrating its commitment to energy innovation through development of a
state-of-the-art coal gasification plant. Southern Company has been recognized
by the U.S. Department of Defense and GI Jobs magazine as a top military
employer and listed by DiversityInc as a top company for Blacks. The company
received the 2012 Edison Award from the Edison Electric Institute for its
leadership in new nuclear development, was named Platts' 2011 Power Company of
the Year 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.

Cautionary Note Regarding Forward-Looking Statements:

Certain information contained in this release is forward-looking information
based on current expectations and plans that involve risks and uncertainties.
Forward-looking information includes, among other things, statements
concerning the economy and customer growth. Southern Company cautions that
there are certain factors that can cause actual results to differ materially
from the forward-looking information that has been provided. The reader is
cautioned not to put undue reliance on this forward-looking information, which
is not a guarantee of future performance and is subject to a number of
uncertainties and other factors, many of which are outside the control of
Southern Company; accordingly, there can be no assurance that such suggested
results will be realized. The following factors, in addition to those
discussed in Southern Company's Annual Report on Form 10-K for the year ended
December 31, 2011, and subsequent securities filings, could cause actual
results to differ materially from management expectations as suggested by such
forward-looking information: the impact of recent and future federal and state
regulatory changes, including legislative and regulatory initiatives regarding
deregulation and restructuring of the electric utility industry,
implementation of the Energy Policy Act of 2005, environmental laws including
regulation of water, coal combustion byproducts, and emissions of sulfur,
nitrogen, carbon, soot, particulate matter, hazardous air pollutants,
including mercury, and other substances, financial reform legislation, and
also changes in tax and other laws and regulations to which Southern Company
and its subsidiaries are subject, as well as changes in application of
existing laws and regulations; current and future litigation, regulatory
investigations, proceedings, or inquiries, including the pending Environmental
Protection Agency civil actions against certain Southern Company subsidiaries,
Federal Energy Regulatory Commission matters, and Internal Revenue Service and
state tax audits; the effects, extent, and timing of the entry of additional
competition in the markets in which Southern Company's subsidiaries operate;
variations in demand for electricity, including those relating to weather, the
general economy and recovery from the recent recession, population and
business growth (and declines), the effects of energy conservation measures,
and any potential economic impacts resulting from federal budgetary decisions;
available sources and costs of fuels; effects of inflation; ability to control
costs and avoid cost overruns during the development and construction of
facilities, which includes projects involving facility designs that have not
been finalized or previously constructed; investment performance of Southern
Company's employee benefit plans and nuclear decommissioning trust funds;
advances in technology; state and federal rate regulations and the impact of
pending and future rate cases and negotiations, including rate actions
relating to fuel and other cost recovery mechanisms; regulatory approvals and
actions related to the Plant Vogtle expansion, including Georgia Public
Service Commission approvals, Nuclear Regulatory Commission actions, and
potential U.S. Department of Energy loan guarantees; regulatory approvals and
actions related to the Kemper County integrated coal gasification combined
cycle facility, including Mississippi Public Service Commission approvals,
potential U.S. Department of Energy loan guarantees, the South Mississippi
Electric Power Association purchase decision, satisfaction of requirements to
utilize investment tax credits and grants, and the outcome of any further
proceedings regarding the Mississippi Public Service Commission's issuance of
the certificate of public convenience and necessity; the performance of
projects undertaken by the non-utility businesses and the success of efforts
to invest in and develop new opportunities; internal restructuring or other
restructuring options that may be pursued; potential business strategies,
including acquisitions or dispositions of assets or businesses, which cannot
be assured to be completed or beneficial to Southern Company or its
subsidiaries; the ability of counterparties of Southern Company and its
subsidiaries to make payments as and when due and to perform as required; the
ability to obtain new short- and long-term contracts with wholesale customers;
the direct or indirect effect on the Southern Company system's business
resulting from terrorist incidents and the threat of terrorist incidents,
including cyber intrusion; interest rate fluctuations and financial market
conditions and the results of financing efforts, including Southern Company's
and its subsidiaries' credit ratings; the impacts of any potential U.S. credit
rating downgrade or other sovereign financial issues, including impacts on
interest rates, access to capital markets, impacts on currency exchange rates,
counterparty performance, and the economy in general, as well as potential
impacts on the availability or benefits of proposed U.S. Department of Energy
loan guarantees; the ability of Southern Company and its subsidiaries to
obtain additional generating capacity at competitive prices; catastrophic
events such as fires, earthquakes, explosions, floods, hurricanes, droughts,
pandemic health events such as influenzas, or other similar occurrences; the
direct or indirect effects on the Southern Company system's business resulting
from incidents affecting the U.S. electric grid or operation of generating
resources; and the effect of accounting pronouncements issued periodically by
standard setting bodies. Southern Company expressly disclaims any obligation
to update any forward-looking information.



Southern Company
Financial Highlights
(In Millions of Dollars Except Earnings Per Share)
                           Three Months Ended                Year-to-Date
                           September                         September
                           2012          2011                 2012     2011
Consolidated Earnings–As
Reported
(See Notes)
 Traditional Operating   $   908       $   862              $ 1,797  $ 1,804
Companies
Southern Power              68            56                 144      138
 Total                       976           918                1,941    1,942
 Parent Company and          -             (2)                26       -
Other
 Net Income–As           $   976       $   916              $ 1,967  $ 1,942
Reported
 Basic Earnings Per      $   1.11      $   1.07             $ 2.26   $ 2.27
Share
 Average Shares
Outstanding (in                876           860                872      854
millions)
 End of Period Shares
Outstanding (in                                                 875      862
millions)
                           Three Months Ended                Year-to-Date
                           September                         September
                           2012          2011                 2012     2011
Consolidated
Earnings–Excluding Items
(See Notes)
 Net Income–As           $   976       $   916              $ 1,967  $ 1,942
Reported
 MC Asset Recovery
Insurance Settlement,          -             -                  (21)     -
net
 Net Income–Excluding    $   976       $   916              $ 1,946  $ 1,942
Items
 Basic Earnings Per      $   1.11      $   1.07             $ 2.24   $ 2.27
Share–Excluding Items
Notes
- For the three months and nine months ended September 30, 2012 and 2011,
dilution does not change basic earnings per share by more than 3 cents and is
not material.
- In March 2009, Southern Company recorded a charge related to a settlement
agreement with MC Asset Recovery, LLC (MCAR) to settle a lawsuit.
Southern Company filed an insurance claim for a portion of the MCAR settlement
amount. In June 2012, Southern Company received an insurance
recovery related to this claim. Earnings for the nine months ended September
30, 2012 include 2 cents a share for the MCAR insurance recovery.
- Certain prior year data has 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
Significant Factors Impacting EPS
                     Three Months Ended September   Year-to-Date September
                       2012       2011       Change    2012    2011     Change
Consolidated
Earnings Per
Share–
As Reported (See       $1.11      $1.07    $ 0.04      $2.26   $2.27  $ (0.01)
Notes)
 Significant
Factors:
 Traditional
Operating                                    0.05                       (0.01)
Companies
 Southern Power                            0.01                       0.01
 Parent Company                            -                          0.03
and Other
 Additional                                (0.02)                     (0.04)
Shares
 Total–As                                $ 0.04                     $ (0.01)
Reported
                     Three Months Ended September   Year-to-Date September
                       2012       2011       Change    2012    2011     Change
Consolidated
Earnings Per
Share–
Excluding Items        $1.11      $1.07    $ 0.04      $2.24   $2.27  $ (0.03)
(See Notes)
 Total–As                                  0.04                       (0.01)
Reported
 MC Asset
Recovery Insurance                           0.00                       (0.02)
Settlement
 Total–Excluding                         $ 0.04                     $ (0.03)
Items
Notes
- For the three months and nine months ended September 30, 2012 and 2011,
dilution does not change basic earnings per share by more than 3 cents and is
not material.
- In March 2009, Southern Company recorded a charge related to a settlement
agreement with MC Asset Recovery, LLC (MCAR) to settle a lawsuit.
Southern Company filed an insurance claim for a portion of the MCAR settlement
amount. In June 2012, Southern Company received an insurance
recovery related to this claim. Earnings for the nine months ended September
30, 2012 include 2 cents a share for the MCAR insurance recovery.
- Certain prior year data has 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
EPS Earnings Analysis
Three Months Ended September 2012
 Cents            Description
 (3)¢             Retail Sales
 9                Retail Revenue Impacts
 (7)              Weather
 7                Non-Fuel Expenses
 (1)              Depreciation and Amortization
 (1)              Interest Expense
 1                Income Taxes
 5¢               Total Traditional Operating Companies
 1                Southern Power
 (2)              Increase in Shares
 4¢               Total Change in QTD EPS
 Notes
 - 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
(In Millions of Dollars)
                     Three Months Ended            Year-to-Date September
                     September
                     2012     2011     Change      2012      2011      Change
Income Account-
Retail Revenues-
 Fuel           $  1,445  $ 1,748  $ (303)     $ 3,709   $ 4,542   $ (833)
 Non-Fuel          2,934    2,945    (11)        7,359     7,389     (30)
Wholesale            497      557      (60)        1,261     1,513     (252)
Revenues
Other Electric       157      161      (4)         459       464       (5)
Revenues
Non-regulated
Operating            16       17       (1)         46        53        (7)
Revenues
Total Revenues       5,049    5,428    (379)       12,834    13,961    (1,127)
Fuel and             1,717    2,123    (406)       4,362     5,517     (1,155)
Purchased Power
Non-fuel O & M       906      983      (77)        2,817     2,837     (20)
MC Asset Recovery
Insurance            0        0        0           (19)      0         (19)
Settlement
Depreciation and     449      431      18          1,335     1,279     56
Amortization
Taxes Other Than     237      239      (2)         690       686       4
Income Taxes
Total Operating      3,309    3,776    (467)       9,185     10,319    (1,134)
Expenses
Operating Income     1,740    1,652    88          3,649     3,642     7
Allowance for
Equity Funds Used    39       42       (3)         102       113       (11)
During
Construction
Interest Expense,
Net of Amounts       218      217      1           649       638       11
Capitalized
Other Income         1        (1)      2           12        (3)       15
(Expense), net
Income Taxes         569      543      26          1,098     1,123     (25)
Net Income           993      933      60          2,016     1,991     25
Dividends on
Preferred and        17       17       0           49        49        0
Preference Stock
of Subsidiaries
NET INCOME AFTER
DIVIDENDS ON
PREFERRED
 AND PREFERENCE $  976    $ 916    $ 60        $ 1,967   $ 1,942   $ 25
STOCK (See Notes)
Notes
- Certain prior year data has 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 September         Year-to-Date September
                                         Weather                                Weather
                                         Adjusted                               Adjusted
As Reported    2012     2011     Change  Change     2012      2011      Change  Change
(See Notes)
Kilowatt-Hour
Sales-
Total Sales    52,586   55,291   -4.9%              141,074   148,489   -5.0%
Total Retail   44,137   45,970   -4.0%   -1.4%      119,945   124,519   -3.7%   -0.1%
Sales-
             15,479   16,678   -7.2%   -2.1%      39,315    42,894    -8.3%   -0.1%
Residential
 Commercial  15,032   15,401   -2.4%   -0.1%      40,734    41,673    -2.3%   0.0%
 Industrial  13,394   13,658   -1.9%   -1.9%      39,206    39,247    -0.1%   -0.1%
 Other       232      233      -0.8%   -0.5%      690       705       -2.1%   -1.6%
Total
Wholesale      8,449    9,321    -9.4%   N/A        21,129    23,970    -11.9%  N/A
Sales
Notes
- Certain prior year data has 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
Financial Overview
(In Millions of Dollars)
                 Three Months Ended September     Year-to-Date September
                    2012          2011      %        2012      2011     %
                                            Change                      Change
Consolidated –
Operating           $5,049        $5,428    -7.0%    $12,834   $13,961  -8.1%
Revenues
Earnings Before     1,562         1,476     5.8%     3,114     3,114    0.0%
Income Taxes
Net Income
Available to        976           916       6.6%     1,967     1,942    1.3%
Common
Alabama Power –
Operating           $1,637        $1,671    -2.0%    $4,230    $4,431   -4.5%
Revenues
Earnings Before     474           454       4.4%     1,015     1,043    -2.7%
Income Taxes
Net Income
Available to        280           264       6.1%     591       606      -2.5%
Common
Georgia Power –
Operating           $2,498        $2,788    -10.4%   $6,263    $7,042   -11.1%
Revenues
Earnings Before     843           827       1.9%     1,558     1,631    -4.5%
Income Taxes
Net Income
Available to        525           520       1.0%     987       1,035    -4.6%
Common
Gulf Power –
Operating           $422          $468      -9.9%    $1,108    $1,192   -7.0%
Revenues
Earnings Before     80            68        16.6%    172       143      20.1%
Income Taxes
Net Income
Available to        48            41        15.9%    103       86       19.9%
Common
Mississippi
Power –
Operating           $305          $326      -6.2%    $800      $875     -8.6%
Revenues
Earnings Before     77            57        34.6%    159       117      34.9%
Income Taxes
Net Income
Available to        55            38        43.7%    115       78       47.5%
Common
Southern Power –
Operating           $355          $363      -2.1%    $894      $950     -5.8%
Revenues
Earnings Before     102           89        14.5%    220       216      1.9%
Income Taxes
Net Income
Available to        68            56        21.9%    144       138      4.2%
Common
Notes
- Certain prior year data has 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.



SOURCE Southern Company

Website: http://www.southerncompany.com
Contact: Media Contact: Southern Company Media Relations, +1-404-506-5333 or
+1-866-506-5333, www.southerncompany.com; Investor Relations Contact: Dan
Tucker, +1-404-506-5310, dstucker@southernco.com
 
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