Portland General Electric Announces Solid First Quarter Earnings Business Wire PORTLAND, Ore. -- May 1, 2013 Portland General Electric Company (NYSE:POR) today reported net income of $49 million, or 65 cents per share, for the first quarter of 2013. Net income and earnings per share were unchanged from the first quarter of 2012 as lower power costs and decreased storm restoration costs offset a decline in retail energy deliveries. In addition, the impact from an increase in PGE’s effective tax rate was largely offset by lower interest expense. “We delivered solid financial results in the first quarter through strong power supply operations and operational excellence,” said Jim Piro, president and chief executive officer. “We’re making excellent progress on our strategic initiatives in 2013, including starting construction on Port Westward 2 and working through the negotiations for selecting the energy, renewable, and seasonal capacity resources from our request for proposals process.” Strategic Updates *General Rate Case—PGE filed a 2014 General Rate Case in mid-February and the case is currently in the discovery phase. Settlement conferences are scheduled for the end of May and Public Utility Commission of Oregon staff and intervener opening testimony is scheduled to be filed in mid-June. The target date for the Commission decision is mid-December 2013. *Request for proposals—PGE is continuing negotiations with top performing bidders for energy and renewables resources. The final short lists include a mix of power purchase agreements and PGE-ownership options. Final resource selections are expected by mid-2013. In addition, PGE is in the process of negotiating power purchase agreements for seasonal peaking capacity. First quarter operating results Total revenues decreased $6 million, or 1 percent, to $473 million in the first quarter of 2013 from $479 million in the first quarter of 2012 due to the net effect of the following: *$13 million decrease in average retail price primarily driven by lower forecasted power costs as established in the 2013 annual power cost update tariff; and *$6 million decrease related to lower volume of retail energy sold and delivered, with total volume down approximately 1 percent from the first quarter of 2012 largely as a result of 2013 having one less day in the quarter due to the leap year in 2012 and the impact of relatively warmer weather during the first quarter of 2013. Residential and commercial volumes were down 1 percent and 3 percent, respectively, which were partially offset by a 2 percent increase in industrial volumes; partially offset by *$5 million increase related to the decoupling mechanism, with a $4 million potential recovery recorded in the first quarter of 2013 compared with a $1 million potential refund recorded in the first quarter of 2012; *$3 million increase related to the Company’s PCAM, as a potential refund was recorded in the first quarter of 2012 related to the 2011 PCAM, with no comparable refund recorded in the first quarter of 2013; and *$6 million, or 60 percent, increase in wholesale revenues consisting of a 39 percent increase in the volume sold and a 12 percent increase in the average price of wholesale power. Purchased power and fuel expense decreased $3 million, or 2 percent, to $192 million in the first quarter of 2013 from $195 million in the first quarter of 2012, largely due to a 2 percent decrease in the average variable power cost, with total system load comparable to the first quarter of 2012. The decrease is primarily due to more generation from lower-cost coal-fired resources, partially offset by an increase in the average cost of purchased power and a decrease in energy received from hydro resources. Production and distribution expense decreased $2 million, or 4 percent, in the first quarter of 2013 compared with the first quarter of 2012, primarily due to lower delivery system costs resulting from higher storm restoration costs incurred during the first quarter of 2012. Interest expense decreased $3 million, or 11 percent, primarily due to a $100 million decrease in the average balance of long-term debt outstanding during the first quarter of 2013 compared with the first quarter of 2012. Income taxes increased $2 million, or 13 percent, in the first quarter of 2013 compared with the first quarter of 2012, reflecting an increase in the company’s effective tax rate to 26.2 percent from 23.4 percent. The increase was primarily due to a reduction of production tax credits (PTC) resulting from lower forecasted wind generation for 2013 compared to 2012, partially offset by an increase in the PTC rate. 2013 earnings guidance PGE is reaffirming full-year 2013 earnings guidance of $1.85 to $2 per diluted share. Guidance is based on the following assumptions: *Load growth toward the lower end of the 0.5 percent to 1 percent range over weather-adjusted 2012; *Hydro conditions slightly below normal, expected wind conditions, and power plants achieving their targeted availability factors; *Operating and maintenance costs between $440 million to $460 million; *Depreciation expense between $240 million and $250 million; *Capital expenditures between $505 million and $525 million, which does not include any potential expenditures related to the energy and renewable resources RFPs; and *Port Westward Unit 2 AFUDC (debt and equity) between $5 million and $6 million. First quarter 2013 earnings call and web cast — May 1, 2013 PGE will host a conference call with financial analysts and investors on Wednesday, May 1, at 11 a.m. ET. The conference call will be web cast live on the PGE website at portlandgeneral.com. A replay of the call will be available beginning at 2 p.m. ET on Wednesday, May 1 through Wednesday, May 8. Jim Piro, president and CEO; Jim Lobdell, senior vice president of finance, CFO, and treasurer; and Bill Valach, director, investor relations, will participate in the call. Management will respond to questions following formal comments. The attached unaudited condensed consolidated statements of income, condensed consolidated balance sheets, and condensed consolidated statements of cash flows, as well as the supplemental operating statistics, are an integral part of this earnings release. About Portland General Electric Company Portland General Electric Company is a vertically integrated electric utility that serves approximately 830,000 residential, commercial and industrial customers in the Portland/Salem metropolitan area of Oregon. The company’s headquarters are located at 121 S.W. Salmon Street, Portland, Oregon 97204. Visit PGE’s website at PortlandGeneral.com. Safe Harbor Statement Statements in this news release that relate to future plans, objectives, expectations, performance, events and the like may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements regarding earnings guidance; statements regarding future load, hydro conditions and operating and maintenance costs; statements concerning implementation of the company’s integrated resource plan; statements concerning future compliance with regulations limiting emissions from generation facilities and the costs to achieve such compliance; as well as other statements containing words such as “anticipates,” “believes,” “intends,” “estimates,” “promises,” “expects,” “should,” “conditioned upon,” and similar expressions. Investors are cautioned that any such forward-looking statements are subject to risks and uncertainties, including reductions in demand for electricity and the sale of excess energy during periods of low wholesale market prices; operational risks relating to the company’s generation facilities, including hydro conditions, wind conditions, disruption of fuel supply, and unscheduled plant outages, which may result in unanticipated operating, maintenance and repair costs, as well as replacement power costs; the costs of compliance with environmental laws and regulations, including those that govern emissions from thermal power plants; changes in weather, hydroelectric and energy markets conditions, which could affect the availability and cost of purchased power and fuel; changes in capital market conditions, which could affect the availability and cost of capital and result in delay or cancellation of capital projects; failure to complete capital projects on schedule or within budget, or the abandonment of capital projects, which could result in the company’s inability to recover project costs; the outcome of various legal and regulatory proceedings; and general economic and financial market conditions. As a result, actual results may differ materially from those projected in the forward-looking statements. All forward-looking statements included in this news release are based on information available to the company on the date hereof and such statements speak only as of the date hereof. The company assumes no obligation to update any such forward-looking statement. Prospective investors should also review the risks and uncertainties listed in the company’s most recent annual report on form 10-K and the company’s reports on forms 8-K and 10-Q filed with the United States Securities and Exchange Commission, including management’s discussion and analysis of financial condition and results of operations and the risks described therein from time to time. POR-F Source: Portland General Electric Company PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (In millions, except per share amounts) (Unaudited) Three Months Ended March 31, 2013 2012 Revenues, net $ 473 $ 479 Operating expenses: Purchased power and fuel 192 195 Production and distribution 51 53 Administrative and other 54 54 Depreciation and amortization 62 62 Taxes other than income taxes 27 27 Total operating expenses 386 391 Income from operations 87 88 Other income: Allowance for equity funds used during 2 1 construction Miscellaneous income, net 1 3 Other income, net 3 4 Interest expense 25 28 Income before income taxes 65 64 Income taxes 17 15 Net income 48 49 Less: net loss attributable to (1 ) — noncontrolling interests Net income attributable to Portland $ 49 $ 49 General Electric Company Weighted-average shares outstanding (in thousands): Basic 75,608 75,423 Diluted 75,699 75,443 Earnings per share—Basic and diluted $ 0.65 $ 0.65 Dividends declared per common share $ 0.270 $ 0.265 PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (In millions) (Unaudited) March 31, December 31, 2013 2012 ASSETS Current assets: Cash and cash equivalents $ 33 $ 12 Accounts receivable, net 144 152 Unbilled revenues 76 97 Inventories 77 78 Margin deposits 33 46 Regulatory assets—current 96 144 Other current assets 105 93 Total current assets 564 622 Electric utility plant, net 4,449 4,392 Regulatory assets—noncurrent 524 524 Nuclear decommissioning trust 38 38 Non-qualified benefit plan 32 32 trust Other noncurrent assets 54 62 Total assets $ 5,661 $ 5,670 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 77 $ 98 Liabilities from price risk 91 127 management activities - current Short-term debt — 17 Current portion of long-term 100 100 debt Accrued expenses and other 192 179 current liabilities Total current liabilities 460 521 Long-term debt, net of current 1,536 1,536 portion Regulatory 782 765 liabilities—noncurrent Deferred income taxes 586 588 Unfunded status of pension and 249 247 postretirement plans Non-qualified benefit plan 103 102 liabilities Asset retirement obligations 93 94 Liabilities from price risk management 78 73 activities—noncurrent Other noncurrent liabilities 16 14 Total liabilities 3,903 3,940 Total equity 1,758 1,730 Total liabilities and equity $ 5,661 $ 5,670 PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) (Unaudited) Three Months Ended March 31, 2013 2012 Cash flows from operating activities: Net income $ 48 $ 49 Depreciation and amortization 62 62 Other non-cash income and expenses, 29 44 net included in Net income Changes in working capital 26 (43 ) Other, net — (2 ) Net cash provided by operating 165 110 activities Cash flows from investing activities: Capital expenditures (108 ) (69 ) Sale of solar power facility — 10 Other, net 1 1 Net cash used in investing activities (107 ) (58 ) Cash flows from financing activities: Maturities of commercial paper, net (17 ) (30 ) Dividends paid (20 ) (20 ) Net cash used in financing activities (37 ) (50 ) Increase in cash and cash equivalents 21 2 Cash and cash equivalents, beginning 12 6 of period Cash and cash equivalents, end of $ 33 $ 8 period PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES SUPPLEMENTAL OPERATING STATISTICS (Unaudited) Three Months Ended March 31, 2013 2012 Revenues (dollars in millions): Retail: Residential $ 246 $ 256 Commercial 149 156 Industrial 51 53 Subtotal 446 465 Other accrued (deferred) 4 (3 ) revenues, net Total retail revenues 450 462 Wholesale revenues 16 10 Other operating revenues 7 7 Total revenues $ 473 $ 479 Energy sold and delivered (MWh in thousands): Retail energy sales: Residential 2,229 2,259 Commercial 1,657 1,733 Industrial 760 810 Total retail energy sales 4,646 4,802 Retail energy deliveries: Commercial 130 106 Industrial 264 196 Total retail energy deliveries 394 302 Total retail energy sales and 5,040 5,104 deliveries Wholesale energy deliveries 540 388 Total energy sold and delivered 5,580 5,492 Number of retail customers at end of period: Residential 726,799 722,419 Commercial 102,379 101,711 Industrial 207 211 Direct access 513 439 Total retail customers 829,898 824,780 PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES SUPPLEMENTAL OPERATING STATISTICS, continued (Unaudited) Three Months Ended March 31, 2013 2012 Sources of energy (MWh in thousands): Generation: Thermal: Coal 1,361 1,077 Natural gas 976 1,130 Total thermal 2,337 2,207 Hydro 481 583 Wind 245 246 Total generation 3,063 3,036 Purchased power: Term 1,310 1,216 Hydro 393 414 Wind 66 74 Spot 684 783 Total purchased power 2,453 2,487 Total system load 5,516 5,523 Less: wholesale sales (540 ) (388 ) Retail load requirement 4,976 5,135 Heating Degree-days 2013 2012 January 835 740 February 569 618 March 498 609 1st Quarter 1,902 1,967 Average * 1,850 1,848 * — “Average” amounts represent the 15-year rolling averages provided by the National Weather Service (Portland Airport). Contact: Portland General Electric Company Media Contact: Steven Corson, 503-464-8444 Corporate Communications or Investor Contact: Bill Valach, 503-464-7395 Director, Investor Relations
Portland General Electric Announces Solid First Quarter Earnings
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