Eversource Energy (NYSE: ES) today reported full-year 2017 earnings of $988 million, or $3.11 per share, compared with 2016 earnings of $942.3 million, or $2.96 per share.

In the fourth quarter of 2017, Eversource Energy earned $237.4 million, or $0.75 per share, compared with earnings of $229.2 million, or $0.72 per share, in the fourth quarter of 2016.

“We were pleased with our 2017 performance, a year our customers received industry leading levels of reliable service, our employees achieved record safety performance, and our investors experienced very solid increases in dividends and earnings,” said Jim Judge, Eversource Energy chairman, president and chief executive officer.

2018 and Long-Term Earnings Per Share (EPS) Guidance

Also today, Eversource Energy projected 2018 earnings of between $3.20 per share and $3.30 per share and long-term EPS growth through 2021 of between 5 percent and 7 percent on average, using 2017 earnings of $3.11 per share as the base.

Electric Distribution and Generation

Eversource Energy’s electric distribution and generation segment earned $497.4 million for the full year of 2017, compared with earnings of $462.8 million for the full year of 2016. The segment earned $104 million in the fourth quarter of 2017, compared with earnings of $81.5 million in the fourth quarter of 2016. Improved fourth quarter and full year results were due primarily to a lower effective tax rate in 2017 and lower non-tracked operations and maintenance expense in 2017, partially offset by higher depreciation and property tax expense.

Electric Transmission

Eversource Energy’s transmission segment earned $391.9 million for the full year 2017, compared with earnings of $370.8 million for the full year of 2016. It earned $102.3 million in the fourth quarter of 2017, compared with earnings of $104.2 million in the fourth quarter of 2016. Higher full-year earnings were due primarily to an increased level of investment in Eversource Energy transmission facilities. Lower fourth quarter results in 2017 reflect the impact of a benefit recorded in 2016 related to the recovery of $27.5 million of pre-tax merger-related costs through electric transmission rates.

Natural Gas Distribution

Eversource Energy’s natural gas distribution segment earned $74.6 million for the full year of 2017, compared with earnings of $77.7 million for the full year of 2016. Fourth quarter natural gas segment earnings were $25.5 million in 2017, compared with $25.8 million in 2016. Lower results in 2017 were driven primarily by higher depreciation, operation and maintenance, and property tax expense, partially offset by higher revenues resulting from colder fourth quarter weather in 2017. Firm natural gas sales rose 3 percent in 2017, compared with 2016.

Eversource Energy Parent and Other Companies

Eversource Energy parent and other companies earned $24.1 million for the full year of 2017, compared with $31 million for the full year of 2016. It earned $5.6 million in the fourth quarter of 2017, compared with $17.7 million in the fourth quarter of 2016. Lower fourth quarter results were due primarily to a higher effective tax rate in 2017.

The following table reconciles 2017 and 2016 fourth quarter and full-year earnings per share:

                                Fourth Quarter     Full Year 2016     Reported EPS     $0.72     $2.96       Lower non-tracked O&M in 2017     0.06     0.12       Higher/(lower) transmission earnings in 2017     (0.01)     0.07       Higher retail electric and generation results in 2017     0.01     0.01       Higher property tax and depreciation expense in 2017     (0.03)     (0.06)       Other, including interest expense     ---     0.01 2017     Reported EPS     $0.75     $3.11            

Financial results by segment for the fourth quarter and full-year 2017 and 2016 are noted below:

Three months ended:

                       

(in millions, except EPS)

   

December 31,2017

   

December 31,2016

   

Increase/(Decrease)

   

2017 EPS1

Electric Distribution/Generation     $104.0     $81.5     $22.5     $0.33 Electric Transmission     102.3     104.2     (1.9)     0.32 Natural Gas Distribution     25.5     25.8     (0.3)     0.08 Eversource Parent and Other Companies     5.6     17.7     (12.1)     0.02 Reported Earnings     $237.4     $229.2     $8.2     $0.75                

Full year ended:

                       

(in millions, except EPS)

   

December 31,2017

   

December 31,2016

   

Increase/(Decrease)

   

2017 EPS1

Electric Distribution/Generation     $497.4     $462.8     $34.6     $1.57 Electric Transmission     391.9     370.8     21.1     1.23 Natural Gas Distribution     74.6     77.7     (3.1)     0.23 Eversource Parent and Other Companies     24.1     31.0     (6.9)     0.08 Reported Earnings     $988.0     $942.3     $45.7     $3.11                

Retail sales data:

           

 

                  Three months ended:     December 31, 2017     December 31, 2016     % Change Electric Distribution (Gwh)                   Traditional     6,815     6,748     1.0% Decoupled     6,000     5,928     1.2% Total Electric Distribution     12,815     12,676     1.1%                     Natural Gas Distribution (mmcf)                   Traditional     14,725     13,744     7.1% Decoupled and Special Contracts     16,615     16,191     2.6% Total Natural Gas Distribution     31,340     29,935     4.7%                           Full year ended:     December 31, 2017     December 31, 2016     % Change Electric Distribution (Gwh)                   Traditional     27,855     28,479     (2.2%) Decoupled     24,391     25,163     (3.1%) Total Electric Distribution     52,246     53,642     (2.6%)                     Natural Gas Distribution (mmcf)                   Traditional     46,957     45,314     3.6% Decoupled and Special Contracts     54,069     52,728     2.5% Total Natural Gas Distribution     101,026     98,042     3.0%  

Eversource Energy has approximately 317 million common shares outstanding and operates New England’s largest energy delivery system. It serves nearly 4 million electric, natural gas and water customers in Connecticut, Massachusetts and New Hampshire.

  Note: Eversource Energy will webcast a conference call with senior management on February 23, 2018, beginning at 9 a.m. Eastern Time. The webcast and associated slides can be accessed through Eversource Energy’s website at www.eversource.com.

1 All per-share amounts in this news release are reported on a diluted basis. The only common equity securities that are publicly traded are common shares of Eversource Energy. The earnings and EPS of each business do not represent a direct legal interest in the assets and liabilities allocated to such business, but rather represent a direct interest in Eversource Energy's assets and liabilities, as a whole. EPS by business is a non-GAAP (not determined using generally accepted accounting principles) measure that is calculated by dividing the net income or loss attributable to controlling interests of each business by the weighted average diluted Eversource parent common shares outstanding for the period. Management uses this non-GAAP financial measure to evaluate earnings results, provide details of earnings results by business, and more fully compare and explain our fourth quarter and full-year 2017 and 2016 results. Management believes that this measurement is useful to investors to evaluate the actual and projected financial performance and contribution of Eversource Energy’s businesses. Non-GAAP financial measures should not be considered as alternatives to Eversource Energy’s consolidated net income attributable to controlling interests or EPS determined in accordance with GAAP as indicators of Eversource Energy’s operating performance.

This news release includes statements concerning Eversource Energy’s expectations, beliefs, plans, objectives, goals, strategies, assumptions of future events, future financial performance or growth and other statements that are not historical facts. These statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, readers can identify these forward-looking statements through the use of words or phrases such as “estimate,” “expect,” “anticipate,” “intend,” “plan,” “project,” “believe,” “forecast,” “should,” “could” and other similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results or outcomes to differ materially from those included in the forward-looking statements. Factors that may cause actual results to differ materially from those included in the forward-looking statements include, but are not limited to, cyber breaches, acts of war or terrorism, or grid disturbances; actions or inaction of local, state and federal regulatory, public policy and taxing bodies; changes in business conditions, which could include disruptive technology related to Eversource Energy’s current or future business model; changes in economic conditions, including impact on interest rates, tax policies, and customer demand and payment ability; fluctuations in weather patterns; changes in laws, regulations or regulatory policy; changes in levels or timing of capital expenditures; disruptions in the capital markets or other events that make Eversource Energy’s access to necessary capital more difficult or costly; developments in legal or public policy doctrines; technological developments; changes in accounting standards and financial reporting regulations; actions of rating agencies; and other presently unknown or unforeseen factors.

Other risk factors are detailed in Eversource Energy’s reports filed with the Securities and Exchange Commission (SEC) and updated as necessary, and are available on Eversource Energy’s website at www.eversource.com and on the SEC’s website at www.sec.gov. All such factors are difficult to predict and contain uncertainties that may materially affect Eversource Energy’s actual results. You should not place undue reliance on the forward-looking statements; each speaks only as of the date on which such statement is made, and Eversource Energy undertakes no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events.

     

EVERSOURCE ENERGY AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Unaudited)

  As of December 31, (Thousands of Dollars)       2017     2016    

ASSETS

Current Assets: Cash and Cash Equivalents $ 38,165 $ 30,251 Receivables, Net 925,083 847,301 Unbilled Revenues 201,361 168,490 Fuel, Materials, Supplies and Inventory 223,063 328,721 Regulatory Assets 741,868 887,625 Prepayments and Other Current Assets 138,009 215,284 Assets Held for Sale   219,550     —   Total Current Assets   2,487,099     2,477,672     Property, Plant and Equipment, Net   23,617,463     21,350,510     Deferred Debits and Other Assets: Regulatory Assets 4,497,447 3,638,688 Goodwill 4,427,266 3,519,401 Marketable Securities 585,419 544,642 Other Long-Term Assets   605,692     522,260   Total Deferred Debits and Other Assets   10,115,824     8,224,991     Total Assets $ 36,220,386   $ 32,053,173    

LIABILITIES AND CAPITALIZATION

Current Liabilities: Notes Payable $ 1,088,087 $ 1,148,500 Long-Term Debt – Current Portion 549,631 773,883 Accounts Payable 1,085,034 884,521 Regulatory Liabilities 128,071 146,787 Other Current Liabilities   738,222     684,914   Total Current Liabilities   3,589,045     3,638,605     Deferred Credits and Other Liabilities: Accumulated Deferred Income Taxes 3,297,518 5,607,207 Regulatory Liabilities 3,637,273 702,255 Derivative Liabilities 377,257 413,676 Accrued Pension, SERP and PBOP 1,228,091 1,141,514 Other Long-Term Liabilities   1,073,501     853,260   Total Deferred Credits and Other Liabilities   9,613,640     8,717,912     Capitalization: Long-Term Debt   11,775,889     8,829,354     Noncontrolling Interest – Preferred Stock of Subsidiaries   155,570     155,568     Equity: Common Shareholders’ Equity: Common Shares 1,669,392 1,669,392 Capital Surplus, Paid In 6,239,940 6,250,224 Retained Earnings 3,561,084 3,175,171 Accumulated Other Comprehensive Loss (66,403 ) (65,282 ) Treasury Stock   (317,771 )   (317,771 ) Common Shareholders’ Equity   11,086,242     10,711,734   Total Capitalization   23,017,701     19,696,656     Total Liabilities and Capitalization $ 36,220,386   $ 32,053,173  

The data contained in this report is preliminary and is unaudited. This report is being submitted for the sole purpose of providing information to present shareholders about Eversource Energy and Subsidiaries and is not a representation, prospectus, or intended for use in connection with any purchase or sale of securities.

     

EVERSOURCE ENERGY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

  For the Three Months Ended December 31, (Thousands of Dollars, Except Share Information)       2017     2016     Operating Revenues $ 1,895,494 $ 1,776,604   Operating Expenses: Purchased Power, Fuel and Transmission 580,142 498,899 Operations and Maintenance 343,747 357,965 Depreciation 202,651 183,685 Amortization of Regulatory Assets, Net 31,927 15,473 Energy Efficiency Programs 89,074 127,697 Taxes Other Than Income Taxes   197,109   154,853 Total Operating Expenses   1,444,650   1,338,572 Operating Income 450,844 438,032 Interest Expense 102,278 102,393 Other Income, Net   21,704   22,231 Net Income Before Income Tax Expense 370,270 357,870 Income Tax Expense   130,971   126,811 Net Income 239,299 231,059 Net Income Attributable to Noncontrolling Interests   1,880   1,880 Net Income Attributable to Common Shareholders $ 237,419 $ 229,179   Basic and Diluted Earnings Per Common Share $ 0.75 $ 0.72   Weighted Average Common Shares Outstanding: Basic   317,396,842   317,510,251 Diluted   318,105,193   318,282,127

The data contained in this report is preliminary and is unaudited. This report is being submitted for the sole purpose of providing information to present shareholders about Eversource Energy and Subsidiaries and is not a representation, prospectus, or intended for use in connection with any purchase or sale of securities.

     

EVERSOURCE ENERGY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

  For the Years Ended December 31, (Thousands of Dollars, Except Share Information)       2017     2016     2015         Operating Revenues $ 7,751,952 $ 7,639,129 $ 7,954,827   Operating Expenses: Purchased Power, Fuel and Transmission 2,535,271 2,500,828 3,086,905 Operations and Maintenance 1,277,147 1,323,549 1,329,289 Depreciation 773,802 715,466 665,856 Amortization of Regulatory Assets, Net 89,986 71,696 22,339 Energy Efficiency Programs 480,835 533,659 495,701 Taxes Other Than Income Taxes   676,757   634,072   590,573 Total Operating Expenses   5,833,798   5,779,270   6,190,663 Operating Income 1,918,154 1,859,859 1,764,164 Interest Expense 421,755 400,961 372,420 Other Income, Net   78,008   45,920   34,227 Income Before Income Tax Expense 1,574,407 1,504,818 1,425,971 Income Tax Expense   578,892   554,997   539,967 Net Income 995,515 949,821 886,004 Net Income Attributable to Noncontrolling Interests   7,519   7,519   7,519 Net Income Attributable to Common Shareholders $ 987,996 $ 942,302 $ 878,485   Basic Earnings per Common Share $ 3.11 $ 2.97 $ 2.77   Diluted Earnings Per Common Share $ 3.11 $ 2.96 $ 2.76   Weighted Average Common Shares Outstanding: Basic   317,411,097   317,650,180   317,336,881 Diluted   318,031,580   318,454,239   318,432,687

The data contained in this report is preliminary and is unaudited. This report is being submitted for the sole purpose of providing information to present shareholders about Eversource Energy and Subsidiaries and is not a representation, prospectus, or intended for use in connection with any purchase or sale of securities.

     

EVERSOURCE ENERGY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

  For the Years Ended December 31, (Thousands of Dollars)       2017     2016     2015         Operating Activities: Net Income $ 995,515 $ 949,821 $ 886,004 Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities: Depreciation 773,802 715,466 665,856 Deferred Income Taxes 491,630 466,463 491,736 Pension, SERP and PBOP Expense 22,454 39,912 96,017 Pension and PBOP Contributions (242,800 ) (158,741 ) (162,452 ) Regulatory (Under)/Over Recoveries, Net (47,935 ) 13,340 (163,287 ) Amortization of Regulatory Assets, Net 89,986 71,696 22,339 Refunds/(Payments) Related to Spent Nuclear Fuel, Net — 59,804 (297,253 ) Other (148,429 ) (77,294 ) (82,219 ) Changes in Current Assets and Liabilities: Receivables and Unbilled Revenues, Net (117,155 ) (142,699 ) (39,797 ) Fuel, Materials, Supplies and Inventory (9,223 ) 7,755 34,112 Taxes Receivable/Accrued, Net 52,284 234,543 30,282 Accounts Payable 56,067 (14,126 ) (91,618 ) Other Current Assets and Liabilities, Net   88,738     9,112     44,031   Net Cash Flows Provided by Operating Activities   2,004,934     2,175,052     1,433,751     Investing Activities: Investments in Property, Plant and Equipment (2,348,105 ) (1,976,867 ) (1,724,139 ) Proceeds from Sales of Marketable Securities 832,903 659,338 799,165 Purchases of Marketable Securities (810,507 ) (681,272 ) (717,114 ) Acquisition of Aquarion (877,652 ) — — Payments to Acquire Investments (32,634 ) (188,958 ) (23,353 ) Other Investing Activities   25,521     36,951     6,291   Net Cash Flows Used in Investing Activities   (3,210,474 )   (2,150,808 )   (1,659,150 )   Financing Activities: Cash Dividends on Common Shares (602,083 ) (564,486 ) (529,791 ) Cash Dividends on Preferred Stock (7,519 ) (7,519 ) (7,519 ) Increase/(Decrease) in Notes Payable 72,810 (12,453 ) (242,122 ) Issuance of Long-Term Debt 2,500,000 800,000 1,225,000 Retirements of Long-Term Debt (745,000 ) (200,000 ) (216,700 ) Other Financing Activities   (4,754 )   (33,482 )   (18,225 ) Net Cash Flows Provided by/(Used in) Financing Activities   1,213,454     (17,940 )   210,643   Net Increase/(Decrease) in Cash and Cash Equivalents 7,914 6,304 (14,756 ) Cash and Cash Equivalents – Beginning of Year   30,251     23,947     38,703   Cash and Cash Equivalents – End of Year $ 38,165   $ 30,251   $ 23,947  

The data contained in this report is preliminary and is unaudited. This report is being submitted for the sole purpose of providing information to present shareholders about Eversource Energy and Subsidiaries and is not a representation, prospectus, or intended for use in connection with any purchase or sale of securities.

Eversource EnergyJeffrey R. Kotkin, 860-665-5154

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