PSEG Announces 2013 Results

                         PSEG Announces 2013 Results

$2.45 NET INCOME PER SHARE

Operating Earnings of $2.58 Per Share Exceeds Guidance of $2.40 - $2.55 Per
Share

Company Provides 2014 Guidance of $2.55 - $2.75 Per Share

PR Newswire

NEWARK, N.J., Feb. 20, 2014

NEWARK, N.J., Feb. 20, 2014 /PRNewswire/ --Public Service Enterprise Group
(PSEG) reported today 2013 Net Income of $1,243 million or $2.45 per share as
compared to Net Income of $1,275 million, or $2.51 per share for 2012.
Operating Earnings for the year 2013 were $1,309 million or $2.58 per share
compared to 2012 Operating Earnings of $1,236 million or $2.44 per share.

(Logo- http://photos.prnewswire.com/prnh/20120830/MM62627LOGO )

PSEG also reported Net Income for the fourth quarter of 2013 of $200 million,
or $0.39 per share. This compares to fourth quarter 2012 Net Income of $224
million, or $0.44 per share. Operating Earnings for the fourth quarter of
2013 were $248 million, or $0.49 per share compared to fourth quarter 2012
Operating Earnings of $207 million, or $0.41 per share.

"PSEG delivered outstanding results in 2013" said Ralph Izzo, chairman,
president and chief executive officer. "An increased level of investment in
our regulated company produced double-digit earnings growth at PSE&G. PSEG
Power's earnings benefited, as expected, from the locational premium placed on
the capacity price for its generating assets, PSEG Power also realized the
benefits from higher wholesale prices on its open position and successful
management of its gas supply arrangements. We executed well on our business
plan in 2013, and a strong balance sheet continues to support our growth
initiatives without the need to issue equity. Our approach to managing supply
risk has been affirmed during the recent period of extreme weather and
volatility in the power markets. We have successfully responded to record
demand while our customers have benefited from our ability to pass along
savings in gas costs. We look ahead to 2014 with optimism as demonstrated by
the Board's recent decision to increase the common dividend by 2.8% to the
indicative annual level of $1.48 per share."

PSEG believes that the non-GAAP financial measure of "Operating Earnings"
provides a consistent and comparable measure of performance of its businesses
to help shareholders understand performance trends. Operating Earnings
exclude the impact of gains/(losses) associated with Nuclear Decommissioning
Trust (NDT) investments and Mark-To-Market (MTM) accounting as well as other
material one-time items. The table below provides a reconciliation of PSEG's
Net Income to Operating Earnings (a non-GAAP measure) for the full year and
fourth quarter. See Attachment 12 for a complete list of items excluded from
Income from Continuing Operations in the determination of Operating Earnings.



PSEG CONSOLIDATED EARNINGS (unaudited)
Full-Year Comparative Results
2013 and 2012
                    Income             Diluted Earnings
                    ($ millions)       Per Share
                    2013   2012        2013     2012
Operating Earnings  $1,309 $1,236      $2.58    $2.44
 Reconciling Items (66)   39          (0.13)   0.07
Net Income          $1,243 $1,275      $2.45    $2.51
                           Avg. Shares 508M     507M



PSEG CONSOLIDATED EARNINGS (unaudited)
Fourth Quarter Comparative Results
2013 and 2012
                    Income             Diluted Earnings
                    ($ millions)       Per Share
                    2013   2012        2013     2012
Operating Earnings  $248   $207        $0.49    $0.41
 Reconciling Items
                    (48)   17          (0.10)   0.03

Net Income          $200   $224        $0.39    $0.44
                           Avg. Shares 508M     507M



"The emphasis we have placed on the anchor principles of our strategy –
operational excellence, financial strength and disciplined investment –
created benefits in 2013 and is expected to continue to yield results over the
coming year" continued Ralph Izzo. "Double-digit growth in earnings from our
stable, regulated business, Power's strong free cash flow and the benefits
from successful management of our cost structure -- including our pension
obligations -- are expected to yield long lasting benefits to Operating
Earnings. For 2014, we are initiating Operating Earnings guidance of $2.55 -
$2.75 per share. The strong commitment and dedication shown by our employees
to our customers has been a major contributor to our success and provides me
with confidence in our ability to achieve our long-term goals."

The following table outlines PSEG's 2013 operating earnings by subsidiary and
expectations for 2014.

          2014 Guidance and 2013 Operating Earnings

          ($ millions, except EPS)

          
                        2014E               2013A
PSE&G                   $705 - $745         $612
PSEG Power              $550 - $610         $710
PSEG Enterprise/
Other                  $35 - $40           $(13)
Operating Earnings      $1,290 - $1,395     $1,309
Earnings Per Share      $2.55 - $2.75       $2.58

Operating Earnings Review and Outlook by Operating Subsidiary

See Attachments 6 and 7 for detail regarding the quarter-over-quarter and
year-over-year earnings reconciliations for each of PSEG's businesses.

PSEG Power

PSEG Power reported operating earnings of $115 million ($0.23 per share) for
the fourth quarter of 2013, bringing full year operating earnings to $710
million ($1.40 per share). On a comparative basis, PSEG Power reported
operating earnings of $126 million ($0.25 per share) and $663 million ($1.31
per share) for the fourth quarter and full year 2012 respectively.

PSEG Power's operating earnings in the fourth quarter benefited from higher
capacity revenues, an improvement in the market price of energy on a net long
position, an increase in volume and a decline in the supply cost of gas. The
improvement in gross margin during the quarter nearly offset the impact on
operating earnings from an increase in operating and maintenance expense
associated with outage related work.

Power's earnings for the fourth quarter benefited from higher revenues in PJM.
An increase in our average PJM capacity prices to $244/MW-day from $153/MW-day
on June 1, 2013 improved quarter-over-quarter earnings by $0.10 per share. The
improvement in capacity revenues more than offset the $0.09 per share impact
on earnings from lower realized prices on energy hedges. Higher prices for
natural gas and an improvement in basis in the PS-zone had a favorable
influence on the price received by Power on its open wholesale power position.
In addition, Power's results continued to benefit from its firm gas
transportation contracts which provided it with access to low-cost gas from
the Marcellus Basin. Together these items added $0.02 per share to Power's
quarter-over-quarter earnings. Generation volumes increased in the fourth
quarter relative to the year-ago period when production was impacted by
Superstorm Sandy. The increase in generation added $0.01 per share to Power's
quarter-over-quarter earnings comparisons. Operating and maintenance (O&M)
expenditures were higher than normal during the quarter due to outage related
work – both planned and unplanned -- at the nuclear and fossil stations. The
increase in O&M reduced quarter-over-quarter earnings comparisons by $0.08 per
share. The absence of debt restructuring costs in the year-ago period improved
quarter-over-quarter earnings comparisons by $0.02 per share. An increase in
depreciation expense was offset by a reduction in interest expense.

Power's output increased 6.2% in the quarter from year-ago levels. For the
year, output increased 1.8% to 53.5 TWh. The fleet's fuel and dispatch
flexibility was demonstrated in the quarter and throughout the year. The
nuclear fleet produced 29.5 TWh (55% of total generation) operating at an
average capacity factor of 90.3%. Record production from Salem 2 helped offset
the impact from a refueling-outage related decline in production at Hope
Creek. The gas-fired combined cycle fleet produced 15.9 TWh in 2013 (30% of
total generation). Record setting output from the Linden station helped to
partially offset the impact on production from planned major maintenance work
at the Bethlehem Energy Center in the second half of the year. The coal fleet
responded to an improvement in dark spreads. Production from the base-load
coal-fired stations in Pennsylvania increased 20% as the New Jersey stations
continued to operate on gas and Bridgeport Harbor's output increased in
response to higher market prices. The coal stations together provided 7.3 Twh
of output in 2013 (14% of total generation).

Power continues to forecast output for 2014 of 53 – 55 TWh. Approximately 75%
- 80% of anticipated production for the year is hedged at an average price of
$48 per MWh which compares with average hedge prices in 2013 of $50 per MWh.
Power has hedged approximately 45% - 55% of its forecast generation in 2015 of
53 – 55 TWh at an average price of $51 per MWh. Power's forecast of total
output over 2014 – 2015 has increased slightly from prior guidance. For 2016,
Power has hedged 20% - 30% of forecast production of 53 – 55 TWh at an average
price of $53 per MWh. The increase in the percentage of generation hedged over
2014 – 2015 reflects the completion of the most recent Basic Generation
Service auction in New Jersey. The hedge data for 2014 and 2015 assumes BGS
volumes represent approximately 11 TWh in 2014 and 10 TWh in 2015 compared to
approximately 12 TWh in 2013.

PSEG Power's operating earnings for 2013 and 2012 reflect the inclusion of its
50% equity interest in a partnership that owns and operates the Kalaeloa
generation facility in Hawaii and its wholly owned interest in PSEG Solar
Source LLC, both of which were transferred from Energy Holdings in 2013. These
assets provided $0.03 per share of operating earnings in 2013 compared with
operating earnings in 2012 of $0.04 per share.

Power's operating earnings for 2014 are forecast at $550 million - $610
million. Results for the full year will be influenced by a decline in our
average PJM capacity price on June 1, 2014 to $167/MW-day from the
historically high level of $244/MW-day and a $2/MWh reduction in the average
price of energy hedges. Power's fuel costs should continue to benefit from
favorable access to low-cost Marcellus gas supply, and O&M should compare
favorably with the results of 2013 given a decline in pension expense, and
on-going cost control.

PSE&G

PSE&G reported operating earnings of $144 million ($0.29 per share) for the
fourth quarter bringing full year operating earnings to $612 million ($1.21
per share). On a comparative basis, PSE&G reported operating earnings of $75
million ($0.15 per share) and $528 million ($1.04 per share) for the fourth
quarter and full year 2012, respectively.

PSE&G's earnings for the fourth quarter reflect the benefit of an increase in
revenue associated with a greater level of capital investment and a decline in
O&M expense relative to the prior year period which included Superstorm
Sandy-related restoration expenditures.

An increase in transmission earnings from increased investment added $0.04 per
share to earnings in the quarter. An absence of Sandy-related restoration
expenditures improved quarter-over-quarter earnings comparisons by $0.04 per
share. Electric and Gas demand was influenced by weather which was slightly
colder than a year ago. Also, weather normalized demand for gas continued to
improve. The impact on earnings quarter-over-quarter from the improvement in
demand and weather was $0.01 per share. Earnings comparisons in the quarter
also improved by $0.04 per share due to a reduction in taxes and the absence
of a tax-related change in reserves recognized in the prior year.
Miscellaneous items contributed $0.01 per share quarter-over-quarter.

Economic conditions in the service area have stabilized and exhibit signs of a
slow recovery. On a weather-normalized basis, electric sales are estimated to
have improved in the quarter by 2.7%. For the year, weather-normalized sales
declined by 1.5%. It's too early to characterize the improvement in
weather-normalized sales for the quarter as the result of economic growth,
given comparisons against a period impacted by Sandy-related outages. Gas
deliveries, however, continue to point to an improvement in demand as a result
of still low commodity prices and slowly recovering economic conditions. On a
weather-normalized basis, gas deliveries increased 2.7% in the fourth quarter
and 2.2% for the year.

The Federal Energy Regulatory Commission (FERC) approved an agreement reached
with certain customers which provides for an annual increase in transmission
revenue of $171 million under the company's formula rate filing. The increase
in revenue was effective on January 1, 2014.

PSE&G was assigned construction by PJM of a new transmission project that will
construct a double-circuit line in the Bergen-Linden Corridor to maintain the
reliability of the northeastern electrical grid. This project has an expected
in-service date of June 2018, and an estimated construction cost of up to $1.2
billion. The net increase in capital expenditures is expected to be less than
the cost of the 345-kV project which will eliminate the need for other
projects.

PSE&G's operating earnings for 2014 are forecast at $705 million - $745
million. Operating earnings will be influenced by an increase in transmission
revenues, an increase in the amount of capital invested in solar and a
reduction in pension expenses.

PSEG Enterprise/Other

PSEG Enterprise/Other reported a loss in operating earnings for the fourth
quarter of $11 million ($0.03) per share compared to operating earnings of $6
million ($0.01 per share) for the fourth quarter of 2012. The results for the
fourth quarter brought the full year 2013 for PSEG Enterprise/Other to a loss
of $13 million ($0.03 per share) versus Operating Earnings in 2012 of $45
million ($0.09 per share).

The results reflect the distribution to PSEG Power of Energy Holdings' 50%
equity interest in a partnership that owns the Kalaeloa generating facility as
well as its wholly owned interest in PSEG Solar Source LLC. Operating earnings
on the remaining portfolio of assets reflect a decline in lease income as well
as additional taxes. These items reduced quarter-over-quarter earnings by
$0.03 per share.

For 2014, operating earnings for PSEG Enterprise/Other are forecast to be $35
million - $40 million. Results will include the fee associated with the
distribution management contract for PSEG – Long Island.

Long Island Power Authority

On December 31, 2013, PSEG-Long Island LLC and the Long Island Power Authority
(LIPA) entered into a twelve-year Amended and Restated Operations Services
Agreement (OSA) effective January 1, 2014 to operate LIPA's electric
transmission and distribution (T&D) system in Long Island, NY. In addition,
there is the opportunity for the parties to extend the contract for an
additional eight years subject to the achievement by PSEG LI of certain
performance levels during the initial term of the OSA. Also, beginning in
2015, Power will provide fuel procurement and power management services to
LIPA under separate agreements.

The following attachments can be found on www.pseg.com:

Attachment 1 - Operating Earnings and Per Share Results by Subsidiary
Attachment 2 - Consolidating Statements of Operations
Attachment 3 - Consolidating Statements of Operations
Attachment 4 - Capitalization Schedule
Attachment 5 - Condensed Consolidated Statements Of Cash Flows
Attachment 6 - Quarter-over-Quarter EPS Reconciliation
Attachment 7 - Year-over-Year EPS Reconciliation
Attachment 8 - Generation Measures
Attachment 9 - Retail Sales and Revenues
Attachment 10 - Retail Sales and Revenues
Attachment 11 - Statistical Measures
Attachment 12 - Reconciliation of Operating Earnings to GAAP Net Income



FORWARD-LOOKING STATEMENTS
Certain of the matters discussed in this communication about our and our
subsidiaries' future performance, including, without limitation, future
revenues, earnings, strategies, prospects, consequences and all other
statements that are not purely historical constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward- looking statements are subject to risks and
uncertainties, which could cause actual results to differ materially from
those anticipated. Such statements are based on management's beliefs as well
as assumptions made by and information currently available to management.
When used herein, the words "anticipate," "intend," "estimate," "believe,"
"expect," "plan," "should," "hypothetical," "potential," "forecast,"
"project," variations of such words and similar expressions are intended to
identify forward-looking statements. Factors that may cause actual results to
differ are often presented with the forward-looking statements themselves.
Other factors that could cause actual results to differ materially from those
contemplated in any forward- looking statements made by us herein are
discussed in filings we make with the United States Securities and Exchange
Commission (SEC), including our Annual Report on Form 10-K and subsequent
reports on Form 10-Q and Form 8-K and available on our website:
http://www.pseg.com. These factors include, but are not limited to:

  oadverse changes in the demand for or the price of the capacity and energy
    that we sell into wholesale electricity markets,
  oadverse changes in energy industry law, policies and regulation, including
    market structures and a potential shift away from competitive markets
    toward subsidized market mechanisms, transmission planning and cost
    allocation rules, including rules regarding how transmission is planned
    and who is permitted to build transmission in the future, and reliability
    standards,
  oany inability of our transmission and distribution businesses to obtain
    adequate and timely rate relief and regulatory approvals from federal and
    state regulators,
  ochanges in federal and state environmental regulations that could increase
    our costs or limit our operations,
  ochanges in nuclear regulation and/or general developments in the nuclear
    power industry, including various impacts from any accidents or incidents
    experienced at our facilities or by others in the industry, that could
    limit operations of our nuclear generating units,
  oactions or activities at one of our nuclear units located on a multi-unit
    site that might adversely affect our ability to continue to operate that
    unit or other units located at the same site,
  oany inability to balance our energy obligations, available supply and
    risks,
  oany deterioration in our credit quality or the credit quality of our
    counterparties, including in our leveraged leases,
  oavailability of capital and credit at commercially reasonable terms and
    conditions and our ability to meet cash needs,
  ochanges in the cost of, or interruption in the supply of, fuel and other
    commodities necessary to the operation of our generating units,
  odelays in receipt of necessary permits and approvals for our construction
    and development activities,
  odelays or unforeseen cost escalations in our construction and development
    activities,
  oany inability to achieve, or continue to sustain, our expected levels of
    operating performance,
  oany equipment failures, accidents, severe weather events or other
    incidents that impact our ability to provide safe and reliable service to
    our customers, and any inability to obtain sufficient coverage or recover
    proceeds of insurance with respect to such events,
  ocybersecurity attacks or intrusions could adversely impact our businesses,
  oincreases in competition in energy supply markets as well as competition
    for certain transmission projects,
  oany inability to realize anticipated tax benefits or retain tax credits,
  ochallenges associated with recruitment and/or retention of a qualified
    workforce,
  oadverse performance of our decommissioning and defined benefit plan trust
    fund investments and changes in funding requirements, and
  ochanges in technology, such as distributed generation and micro grids, and
    resultant changes in customer usage patterns, including energy efficiency
    and demand response.

All of the forward-looking statements made in this report are qualified by
these cautionary statements and we cannot assure you that the results or
developments anticipated by management will be realized or even if realized,
will have the expected consequences to, or effects on, us or our business
prospects, financial condition or results of operations. Readers are cautioned
not to place undue reliance on these forward-looking statements in making any
investment decision. Forward-looking statements made in this report apply only
as of the date of this report. While we may elect to update forward-looking
statements from time to time, we specifically disclaim any obligation to do
so, even if internal estimates change, unless otherwise required by applicable
securities laws. The forward-looking statements contained in this report are
intended to qualify for the safe harbor provisions of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended.

SOURCE Public Service Enterprise Group (PSEG)

Website: http://www.pseg.com
Contact: Jennifer Kramer, 973-430-6027, Jennifer.kramer@pseg.com
 
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