UIL Reports Second Quarter 2013 Earnings and Reaffirms 2013 Earnings Guidance Business Wire NEW HAVEN, Conn. -- August 6, 2013 Today, UIL Holdings Corporation (NYSE: UIL) reported consolidated net income of $17.9 million, or $0.35 per diluted share, in the second quarter of 2013, an increase of $5.9 million, or $0.12 per diluted share, compared to the same period in 2012. For the first six months of 2013, UIL’s consolidated net income was $69.7 million, or $1.36 per diluted share, an increase of $10.7 million, or $0.20 per diluted share, compared to the same period in 2012. “All subsidiaries reported improved financial performance for the quarter and year-to-date,” said James P. Torgerson, UIL’s president and chief executive officer. “The increased earnings in 2013 were due to the return to near normal weather, an increased transmission rate base and the impacts of natural gas conversions. Our conversions of 7,749 for the first half of the year are 70% ahead of 2012 levels and represent 64% of this year’s goal of 12,200 conversions.” “On the regulatory front, last week, PURA issued a draft decision relating to UI’s electric distribution rate case. Today, we filed written exceptions that addressed aspects of the draft that are contrary to the record, law, ratemaking principles and commission precedent. The final decision is expected in mid-August,” added Torgerson. “And, in early July, Connecticut Natural Gas filed an application with PURA to increase its gas delivery rate.” UIL Holdings Corporation’s results for the second quarter and first six months of 2013, compared to the same periods in 2012, are presented in the table below: Net Income (Loss) - $M Quarter ended June 30, Six months ended June 30, 2013 2012 '13 vs 2013 2012 '13 vs '12 '12 Electric Distribution $ 12.1 $ 10.9 $ 1.2 $ 26.6 $ 25.1 $ 1.5 & Other Electric 8.9 7.8 1.1 17.6 15.2 2.4 Transmission Gas (0.9 ) (3.2 ) 2.3 30.6 25.2 5.4 Distribution Operating 20.1 15.5 4.6 74.8 65.5 9.3 Companies Corporate (2.2 ) (3.5 ) 1.3 (5.1 ) (6.5 ) 1.4 Consolidated $ 17.9 $ 12.0 $ 5.9 $ 69.7 $ 59.0 $ 10.7 Earnings Earnings (Loss) Per Share Quarter ended June 30, Six months ended June 30, 2013 2012 '13 vs 2013 2012 '13 vs '12 '12 Electric Distribution $ 0.24 $ 0.21 $ 0.03 $ 0.52 $ 0.49 $ 0.03 & Other Electric 0.17 0.15 0.02 0.34 0.30 0.04 Transmission Gas (0.02 ) (0.06 ) 0.04 0.60 0.49 0.11 Distribution Operating 0.39 0.30 0.09 1.46 1.28 0.18 Companies Corporate (0.04 ) (0.07 ) 0.03 (0.10 ) (0.12 ) 0.02 Consolidated $ 0.35 $ 0.23 $ 0.12 $ 1.36 $ 1.16 $ 0.20 Earnings Avg. Shares 51.2 51.0 51.2 51.0 - diluted Amounts may not add due to rounding United Illuminating United Illuminating (UI) earnings increased by $2.3 million, or $0.05 per diluted share and $3.9 million, or $0.07 per diluted share for the second quarter and the first six months of 2013 compared to the same periods in 2012, respectively. Details of the increase follow. Electric distribution, CTA & other The increase in earnings for the second quarter and first six months of 2013 compared to the same periods in 2012 was due to the absence of after-tax earnings sharing that was recorded in 2012. Due to an increased rate base, no earnings sharing has been recorded in 2013. In the second quarter and first six months of 2013, pre-tax earnings from the equity investment in GenConn were $3.8 million and $7.7 million, respectively, compared to $3.9 million and $8.4 million for the same periods in 2012. The decrease in pre-tax earnings year over year was primarily due to non-recurring adjustments recorded in the first quarter of 2012. Electric transmission The increase in earnings for the second quarter of 2013 compared to the same period in 2012 was primarily attributable to an increase in rate base. The increase in earnings for the first six months of 2013 compared to the same period in 2012 was primarily attributable to increases in rate base and allowance for funds used during construction. Gas distribution The improved results for the second quarter of 2013 compared to the second quarter 2012 was due to the impact of colder weather, increased normalized usage per customer and customer growth. (See chart below) This was partially offset by increased O&M expenses. The increase in earnings for the first six months of 2013 compared to the same period in 2012 was due to the impact of colder weather, increased normalized usage per customer and customer growth. (See chart below) This was partially offset by increased O&M expenses and the absence of $3.5 million, pre-tax, of weather insurance proceeds that were recorded in the first quarter of 2012. The earnings impacts from weather, normalized usage per customer and customer growth are presented in the table below: Impact of Weather, Normalized Usage per Customer and Customer Growth (In Thousands except for per share amounts) 2Q '13 vs. 2Q '12 YTD '13 vs. YTD '12 Gross Margin EPS Gross Margin EPS Weather $ 5,168 $ 0.06 $ 14,142 $ 0.17 Normalized usage per customer 1,186 0.01 2,235 0.03 Subtotal 6,354 0.07 16,377 0.20 Customer Growth 1,481 0.02 3,875 0.04 Total $ 7,835 $ 0.09 $ 20,252 $ 0.24 Amounts may not add due to rounding *Colder temperatures in the second quarter and first six months of 2013 compared to the same periods in 2012 resulted in a 34.0% and 23.9% increase in heating degree days, respectively. Corporate The decrease in costs for the second quarter and the first six months of 2013 compared to the same periods in 2012 was primarily due to tax benefits associated with unitary filing requirements for Massachusetts state income taxes. Looking Forward UIL reaffirms its consolidated earnings guidance for 2013 of $2.05-$2.25 per diluted share. Forecasted earnings for 2013, excluding potential impacts from PURA’s decision in UI’s electric distribution rate case, are detailed in the table below. Category Approximate Net EPS - diluted^(3) Income^(2) Electric distribution, CTA & $46 - $54 $0.90 - $1.05 other Electric transmission $30 - $36 $0.60 - $0.70 Total Electric^(1) $79 - $87 $1.55 - $1.70 Gas distribution $33 - $38 $0.65 - $0.75 UIL Corporate ($11) - ($9) ($0.21) - ($0.18) Total UIL^(1) $105 - $115 $2.05 - $2.25 ^(1) Expectations are not expected to be additive ^(2) Rounded to the nearest million ^(3) Assumes approximately 51.2 million average shares outstanding Second quarter 2013 conference call UIL Holdings will conduct a webcast conference call with financial analysts on Wednesday, August 7, 2013, beginning at 10:00 a.m. eastern time. UIL Holdings’ executive management will present an overview of the financial results followed by a question and answer session. Interested parties, including analysts, investors and the media, may listen live via the internet by logging onto the Investors section of UIL’s website at http://www.uil.com. Institutional investors can access the call via Thomson Street Events (www.streetevents.com), a password-protected event management site. Headquartered in New Haven, Connecticut, UIL Holdings Corporation (NYSE:UIL) is a diversified energy delivery company serving a total of approximately 700,000 electric and natural gas utility customers in 66 communities across two states, with combined total assets of over $4 billion. UIL Holdings is the parent company for The United Illuminating Company (UI), Connecticut Natural Gas Corporation (CNG), The Southern Connecticut Gas Company (SCG), and The Berkshire Gas Company (Berkshire), each more than 100 years old. UI provides for the transmission and delivery of electricity and other energy related services for Connecticut’s Greater New Haven and Bridgeport areas. SCG and CNG are natural gas distribution companies that serve customers in Connecticut, while Berkshire serves natural gas customers in western Massachusetts. UIL Holdings employs more than 1,850 people in the New England region. For more information on UIL Holdings, visit http://www.uil.com. Use of Non-GAAP Measures UIL Holdings believes that a breakdown presented on a net income and per share basis is useful in understanding the change in the consolidated results of operations for UIL Holdings from one reporting period to another. UIL Holdings presents such per share amounts by taking the pretax amounts determined in accordance with generally accepted accounting principles (GAAP), and applying UIL Holdings' combined effective statutory federal and state tax rate and then dividing the results by the average number diluted of shares of UIL Holdings common stock outstanding for the periods presented. Any such amounts provided are provided for informational purposes only and are not intended to be used to calculate "Pro-forma" amounts. UIL Holdings also believes earnings per share (EPS) information by line of business, including as presented above in the net income discussion and in the earnings guidance section is useful in understanding and evaluating actual and projected financial performance and contribution of UIL’s businesses. EPS by business is calculated by taking the pretax amounts determined in accordance with GAAP of each line of business, and applying the effective statutory federal and state tax rate and then dividing the results by the average number of diluted shares of UIL common stock outstanding for the periods presented. Total consolidated EPS is a GAAP-basis presentation. Forward-Looking Statements Certain statements contained herein, regarding matters that are not historical facts, are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995). These include statements regarding management’s intentions, plans, beliefs, expectations or forecasts for the future. Such forward-looking statements are based on management’s expectations and involve risks and uncertainties; consequently, actual results may differ materially from those expressed or implied in the statements. Such risks and uncertainties include, but are not limited to, general economic conditions, legislative and regulatory changes, changes in demand for electricity, gas and other products and services, unanticipated weather conditions, changes in accounting principles, policies or guidelines, and other economic, competitive, governmental, and technological factors affecting the operations, markets, products and services of UIL Holdings’ subsidiaries, The United Illuminating Company, The Southern Connecticut Gas Company, Connecticut Natural Gas Corporation and The Berkshire Gas Company. The foregoing and other factors are discussed and should be reviewed in our most recent Annual Report on Form 10-K for the year ended December 31, 2012, and other subsequent filings with the Securities and Exchange Commission. Forward-looking statements included herein speak only as of the date hereof and we undertake no obligation to revise or update such statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events or circumstances. The following are summaries of UIL Holdings’ unaudited consolidated financial information for the second quarter and first six months of 2012 and 2013: UIL HOLDINGS CORPORATION CONSOLIDATED STATEMENT OF INCOME (In Thousands except per share amounts) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2013 2012 2013 2012 Operating Revenues $ 319,074 $ 282,842 $ 867,113 $ 740,660 Operating Expenses Operation Purchased power 30,193 34,358 68,682 75,016 Natural gas purchased 58,910 39,953 278,177 190,758 Operation and 94,470 87,920 183,729 173,607 maintenance Transmission wholesale 18,517 17,234 37,335 33,282 Depreciation and 45,669 43,048 95,776 89,607 amortization Taxes - other than 28,080 23,822 63,946 54,422 income taxes Total Operating Expenses 275,839 246,335 727,645 616,692 Operating Income 43,235 36,507 139,468 123,968 Other Income and 5,204 4,872 10,565 13,789 (Deductions), net Interest Charges, net Interest on long-term 21,690 21,825 43,376 42,927 debt Other interest, net 1,523 1,312 2,548 2,847 23,213 23,137 45,924 45,774 Amortization of debt expense and redemption 609 599 1,210 1,208 premiums Total Interest Charges, 23,822 23,736 47,134 46,982 net Income from Equity 3,848 3,915 7,660 8,402 Investments Income Before Income 28,465 21,558 110,559 99,177 Taxes Income Taxes 10,531 9,546 40,818 40,089 Net Income 17,934 12,012 69,741 59,088 Less: Preferred Stock Dividends of Subsidiary, 10 13 26 39 Noncontrolling Interests Net Income attributable $ 17,924 $ 11,999 $ 69,715 $ 59,049 to UIL Holdings Average Number of Common Shares Outstanding - 50,972 50,793 50,939 50,740 Basic Average Number of Common Shares Outstanding - 51,201 51,041 51,177 51,002 Diluted Earnings Per Share of $ 0.35 $ 0.24 $ 1.37 $ 1.16 Common Stock - Basic: Earnings Per Share of $ 0.35 $ 0.23 $ 1.36 $ 1.16 Common Stock - Diluted: Cash Dividends Declared per share of Common $ 0.432 $ 0.432 $ 0.864 $ 0.864 Stock UIL HOLDINGS CORPORATION CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For the Three and Six Months Ended June 30, 2013 and 2012 (Thousands of Dollars) (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2013 2012 2013 2012 Net Income $ 17,934 $ 12,012 $ 69,741 $ 59,088 Other Comprehensive (45 ) (154 ) 206 201 Income, net Comprehensive Income 17,889 11,858 69,947 59,289 Less: Preferred Stock Dividends of Subsidiary, 10 13 26 39 Noncontrolling Interests Comprehensive Income attributable to UIL $ 17,879 $ 11,845 $ 69,921 $ 59,250 Holdings UIL HOLDINGS CORPORATION CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) June 30, December 31, (thousands of dollars) 2013 2012 ASSETS Current assets $ 545,879 $ 628,683 Other investments 147,115 148,730 Net property, plant and equipment 2,883,400 2,787,354 Regulatory assets 954,203 1,014,515 Goodwill 266,205 266,205 Deferred charges and other assets 78,246 113,880 Total Assets $ 4,875,048 $ 4,959,367 LIABILITIES AND CAPITALIZATION Current liabilities $ 531,331 $ 625,056 Noncurrent liabilities 630,183 708,968 Deferred income taxes 469,837 462,940 Regulatory liabilities 500,496 445,156 Total Liabilities 2,131,847 2,242,120 Long-term debt, net of unamortized discount 1,597,779 1,600,354 and premium Preferred stock of subsidiary 340 340 Net common stock equity 1,145,082 1,116,553 Total Capitalization 2,743,201 2,717,247 Total Liabilities and Capitalization $ 4,875,048 $ 4,959,367 Contact: UIL Holdings Corporation Analyst: Susan Allen, 203-499-2409 or Media: Michael West Jr., 203-499-3858
UIL Reports Second Quarter 2013 Earnings and Reaffirms 2013 Earnings Guidance
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