RICHMOND, Va., Aug. 3, 2016 /PRNewswire/ -- Dominion
Resources (NYSE: D) today announced unaudited reported earnings
determined in accordance with Generally Accepted Accounting
Principles (reported earnings) for the three months ended
June 30, 2016, of $452 million ($0.73
per share) compared with earnings of $413
million ($0.70 per share) for
the same period in 2015.
Operating earnings for the three months ended June 30, 2016, amounted to $441 million ($0.71
per share), compared to operating earnings of $429 million ($0.73
per share) for the same period in 2015. Operating earnings
are defined as reported earnings adjusted for certain
items.
The principal difference between reported earnings and operating
earnings for the quarter is related to our investments in nuclear
decommissioning trust funds.
Dominion uses operating earnings as the primary performance
measurement of its earnings guidance and results for public
communications with analysts and investors. Dominion also
uses operating earnings internally for budgeting, for reporting to
the Board of Directors, for the company's incentive compensation
plans and for its targeted dividend payouts and other purposes.
Dominion management believes operating earnings provide a more
meaningful representation of the company's fundamental earnings
power.
Thomas F. Farrell II, chairman,
president and chief executive officer, said:
"Our second-quarter operating earnings were in the upper half of
our guidance range of $0.65 to $0.75
per share.
"Strong operational and safety performance continued in the
second quarter. In addition, several milestones were reached
in our growth projects. The 1,385-megawatt Brunswick County Power
Station commenced commercial operations in April, ahead of schedule
and under budget. We also began construction on the
1,588-megawatt Greensville County
combined cycle power station. We are looking forward to getting
this state-of-the-art power station operating and providing energy
to more than 400,000 customers.
"The Cove Point Liquefaction project is now 67 percent complete
and continues on time and on budget for a late 2017 in-service
date. We continue to work toward the construction of the
Atlantic Coast Pipeline and the related Supply Header project with
an expected completion date of late 2018."
SECOND-QUARTER 2016 REPORTED AND OPERATING EARNINGS
COMPARED TO 2015
Reported earnings increased 3
cents per share as compared to second-quarter 2015.
Business segment results and detailed descriptions of items
included in 2016 and 2015 reported earnings but excluded from
operating earnings can be found on Schedules 1, 2 and 3 of this
release.
Operating earnings decreased 2
cents per share as compared to second-quarter 2015 operating
earnings. The decrease in operating earnings was primarily
attributable to milder weather, a planned refueling outage at
Millstone, and share dilution. Positive factors included
revenues from our regulated growth projects, lower capacity
expenses and a farmout transaction. Details of second-quarter 2016
operating earnings as compared to the same period in 2015 may be
found on Schedule 4 of this release.
THIRD-QUARTER 2016 OPERATING EARNINGS GUIDANCE
Dominion expects third-quarter 2016 operating earnings in the
range of $0.95-$1.10 per share,
compared to third-quarter 2015 operating earnings of $1.03 per share. Positive drivers include
increased revenues from our growth projects and lower capacity
expenses offset by the absence of a farmout transaction and share
dilution. Reconciliation of reported and operating earnings
for the third quarter of 2015 can be found on Schedule 3 of this
release.
The company is maintaining its previously issued 2016 operating
earnings guidance of $3.60-$4.00 per
share.
In providing its third-quarter and full-year operating earnings
guidance, the company notes that there could be differences between
expected reported earnings and estimated operating earnings for
matters such as, but not limited to, acquisitions, divestitures or
changes in accounting principles. At this time, Dominion management
is not able to estimate the aggregate impact of these items on
future period reported earnings.
CONFERENCE CALL TODAY
Dominion will host its second-quarter earnings conference call
at 10 a.m. ET on Wednesday, Aug. 3, 2016. Management will
discuss second-quarter financial results and other matters of
interest to the financial community.
Domestic callers should dial (877) 410-5657.
International callers should dial (334) 323-9872.
The passcode for the conference call is "Dominion."
Participants should dial in 10 to 15 minutes prior to the scheduled
start time. Members of the media also are invited to
listen.
A live webcast of the conference call, including accompanying
slides, and other financial information will be available on the
investor information pages at www.dom.com/investors and
www.dommidstream.com/investors.
A replay of the conference call will be available beginning
about 1 p.m. ET Aug. 3 and lasting until 11 p.m. ET Aug. 10. Domestic callers may
access the recording by dialing (877) 919-4059. International
callers should dial (334) 323-0140. The PIN for the replay is
79755313. Additionally, a replay of the webcast will be
available on the investor information pages by the end of the day
Aug. 3.
Dominion is one of the nation's largest producers and
transporters of energy, with a portfolio of approximately 25,700
megawatts of generation, 12,200 miles of natural gas transmission,
gathering and storage pipeline, and 6,500 miles of electric
transmission lines. Dominion operates one of the nation's
largest natural gas storage systems with 933 billion cubic feet of
storage capacity and serves more than 5 million utility and retail
energy customers in 14 states. For more information about Dominion,
visit the company's website at www.dom.com/.
This release contains certain forward-looking statements,
including forecasted operating earnings for third-quarter and
full-year 2016 which is subject to various risks and
uncertainties. Factors that could cause actual results to
differ materially from management's projections, forecasts,
estimates and expectations may include factors that are beyond the
company's ability to control or estimate precisely, including
fluctuations in energy-related commodity prices, estimates of
future market conditions, additional competition in our industries,
changes in the demand for Dominion's services, access to and costs
of capital, fluctuations in the value of our pension assets and
assets held in our decommissioning trusts, impacts of acquisitions,
divestitures, transfers of assets to joint ventures or Dominion
Midstream and retirements of assets based on asset portfolio
reviews, the expected timing and likelihood of completion of the
proposed acquisition of Questar, receipt and terms and conditions
of required regulatory approvals, the receipt of regulatory
approvals for, and timing of, other planned projects, acquisitions
and divestitures, the timing and execution of Dominion Midstream's
growth strategy, and the ability to complete planned construction
or expansion projects at all or within the terms and timeframes
initially anticipated. Other factors include, but are not
limited to, weather conditions and other events, including the
effects of hurricanes, earthquakes, high winds, major storms and
changes in water temperatures on operations, the risk associated
with the operation of nuclear facilities, unplanned outages at
facilities in which Dominion has an ownership interest, the impact
of operational hazards and catastrophic events, state and federal
legislative and regulatory developments, including changes in
federal and state tax laws and changes to environmental and other
laws and regulations, including those related to climate change,
greenhouse gases and other emissions to which we are subject,
changes in enforcement practices of regulators relating to
environmental standards and litigation exposure for remedial
activities, political and economic conditions, industrial,
commercial and residential growth or decline in Dominion's service
area, risks of operating businesses in regulated industries that
are subject to changing regulatory structures, changes to regulated
gas and electric rates collected by Dominion, changes to rating
agency requirements and ratings, changing financial accounting
standards, fluctuations in interest rates, employee workforce
factors, including collective bargaining, counter-party credit and
performance risks, adverse outcomes in litigation matters or
regulatory proceedings, the risk of hostile cyber intrusions and
other uncertainties. Other risk factors are detailed from
time to time in Dominion's quarterly reports on Form 10-Q or most
recent annual report on Form 10-K filed with the Securities and
Exchange Commission.
DOMINION
RESOURCES, INC.
|
CONSOLIDATED
STATEMENTS OF INCOME*
|
Unaudited (GAAP
Based)
|
|
|
|
|
|
Three Months
Ended
June
30,
|
|
Six Months
Ended
June
30,
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Operating
Revenue
|
$
2,598
|
|
$
2,747
|
|
$
5,519
|
|
$
6,156
|
Operating
Expenses
|
|
|
|
|
|
|
|
Electric fuel and
other energy-related purchases
|
551
|
|
591
|
|
1,185
|
|
1,544
|
Purchased electric
capacity
|
45
|
|
90
|
|
113
|
|
184
|
Purchased
gas
|
56
|
|
111
|
|
175
|
|
361
|
Other operations and
maintenance
|
665
|
|
709
|
|
1,368
|
|
1,311
|
Depreciation,
depletion and amortization
|
361
|
|
339
|
|
712
|
|
682
|
Other
taxes
|
139
|
|
134
|
|
303
|
|
299
|
Total operating
expenses
|
1,817
|
|
1,974
|
|
3,856
|
|
4,381
|
Income from
operations
|
781
|
|
773
|
|
1,663
|
|
1,775
|
Other
income
|
72
|
|
56
|
|
126
|
|
116
|
Interest and related
charges
|
239
|
|
221
|
|
465
|
|
444
|
Income from
operations including noncontrolling interests before income tax
expense
|
614
|
|
608
|
|
1,324
|
|
1,447
|
Income tax
expense
|
152
|
|
190
|
|
331
|
|
489
|
Net Income
Including Noncontrolling Interests
|
462
|
|
418
|
|
993
|
|
958
|
Noncontrolling
Interests
|
10
|
|
5
|
|
17
|
|
9
|
Net Income
Attributable to Dominion
|
$
452
|
|
$
413
|
|
$
976
|
|
$
949
|
Earnings Per
Common Share – Basic
|
|
|
|
|
|
|
|
Net Income
Attributable to Dominion
|
$
0.73
|
|
$
0.70
|
|
$
1.61
|
|
$
1.61
|
Earnings Per
Common Share – Diluted
|
|
|
|
|
|
|
|
Net Income
Attributable to Dominion
|
$
0.73
|
|
$
0.70
|
|
$
1.61
|
|
$
1.60
|
Dividends declared
per common share
|
$
0.7000
|
|
$
0.6475
|
|
$
1.4000
|
|
$
1.2950
|
|
|
|
|
|
|
|
|
*The notes contained
in Dominion's most recent quarterly report on Form 10-Q or annual
report on Form 10-K are an
|
integral part of the
Consolidated Financial Statements.
|
|
|
|
|
|
Schedule 1 -
Segment Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preliminary,
Unaudited
|
|
|
|
|
|
(millions, except
earnings per share)
|
Three months ended
June 30,
|
|
|
|
|
2016
|
|
2015
|
|
Change
|
|
|
|
|
|
|
|
|
|
REPORTED EARNINGS
1
|
$
452
|
|
$
413
|
|
$
39
|
|
|
|
|
|
|
|
|
|
|
Pre-tax loss (income)
2
|
(12)
|
|
27
|
|
(39)
|
|
Income tax
2
|
1
|
|
(11)
|
|
12
|
Adjustments to
reported earnings
|
(11)
|
|
16
|
|
(27)
|
|
|
|
|
|
|
|
|
|
OPERATING
EARNINGS
|
$
441
|
|
$
429
|
|
$
12
|
|
By
segment:
|
|
|
|
|
|
|
Dominion Virginia
Power
|
104
|
|
117
|
|
(13)
|
|
Dominion Energy
3
|
162
|
|
129
|
|
33
|
|
Dominion Generation
3
|
171
|
|
250
|
|
(79)
|
|
Corporate and
Other
|
4
|
|
(67)
|
|
71
|
|
|
|
|
$
441
|
|
$
429
|
|
$
12
|
|
|
|
|
|
|
|
|
|
Earnings Per Share
(EPS):
|
|
|
|
|
|
REPORTED EARNINGS
1
|
$
0.73
|
|
$
0.70
|
|
$
0.03
|
Adjustments to
reported earnings (after tax)
|
(0.02)
|
|
0.03
|
|
(0.05)
|
OPERATING
EARNINGS
|
$
0.71
|
|
$
0.73
|
|
$
(0.02)
|
|
By
segment:
|
|
|
|
|
|
|
Dominion Virginia
Power
|
0.17
|
|
0.20
|
|
(0.03)
|
|
Dominion Energy
3
|
0.26
|
|
0.22
|
|
0.04
|
|
Dominion Generation
3
|
0.28
|
|
0.42
|
|
(0.14)
|
|
Corporate and
Other
|
-
|
|
(0.11)
|
|
0.11
|
|
|
|
|
$
0.71
|
|
$
0.73
|
|
$
(0.02)
|
|
|
|
|
|
|
|
|
|
Common Shares
Outstanding (average, diluted)
|
617.0
|
|
592.5
|
|
|
|
|
|
|
|
|
|
|
|
(millions, except
earnings per share)
|
Six months ended
June 30,
|
|
|
|
|
2016
|
|
2015
|
|
Change
|
|
|
|
|
|
|
|
|
|
REPORTED EARNINGS
1
|
$
976
|
|
$
949
|
|
$
27
|
|
|
|
|
|
|
|
|
|
|
Pre-tax loss (income)
2
|
55
|
|
103
|
|
(48)
|
|
Income tax
2
|
(18)
|
|
(39)
|
|
21
|
Adjustments to
reported earnings
|
37
|
|
64
|
|
(27)
|
|
|
|
|
|
|
|
|
|
OPERATING
EARNINGS
|
$
1,013
|
|
$
1,013
|
|
$
-
|
|
By
segment:
|
|
|
|
|
|
|
Dominion Virginia
Power
|
224
|
|
257
|
|
(33)
|
|
Dominion Energy
3
|
348
|
|
356
|
|
(8)
|
|
Dominion Generation
3
|
416
|
|
512
|
|
(96)
|
|
Corporate and
Other
|
25
|
|
(112)
|
|
137
|
|
|
|
|
$
1,013
|
|
$
1,013
|
|
$
-
|
|
|
|
|
|
|
|
|
|
Earnings Per Share
(EPS):
|
|
|
|
|
|
REPORTED EARNINGS
1
|
$
1.61
|
|
$
1.60
|
|
$
0.01
|
Adjustments to
reported earnings (after tax)
|
0.06
|
|
0.11
|
|
(0.05)
|
OPERATING
EARNINGS
|
$
1.67
|
|
$
1.71
|
|
$
(0.04)
|
|
By
segment:
|
|
|
|
|
|
|
Dominion Virginia
Power
|
0.37
|
|
0.43
|
|
(0.06)
|
|
Dominion Energy
3
|
0.57
|
|
0.60
|
|
(0.03)
|
|
Dominion Generation
3
|
0.69
|
|
0.87
|
|
(0.18)
|
|
Corporate and
Other
|
0.04
|
|
(0.19)
|
|
0.23
|
|
|
|
|
$
1.67
|
|
$
1.71
|
|
$
(0.04)
|
|
|
|
|
|
|
|
|
|
Common Shares
Outstanding (average, diluted)
|
607.6
|
|
591.2
|
|
|
|
|
|
|
|
|
|
|
|
1)
|
Determined in
accordance with Generally Accepted Accounting Principles
(GAAP).
|
2)
|
Adjustments to
reported earnings are included in Corporate and Other segment
reported GAAP earnings.
|
|
Refer to Schedules 2
and 3 for details, or find "GAAP Reconciliation" in the Earnings
Release Kit on Dominion's website at
www.dom.com/investors.
|
3)
|
2015 amounts have
been recast to reflect non-regulated retail energy marketing
operations in the Dominion Energy segment.
|
Schedule 2 - Reconciliation of 2016 Reported Earnings to
Operating Earnings
2016 Earnings (Six months ended June
30, 2016)
The $55 million pre-tax net effect
of the adjustments included in 2016 reported earnings, but excluded
from operating earnings, is primarily related to the following
items:
- $65 million charge associated
with an organizational design initiative, and primarily comprised
of employee severance benefits.
- $13 million net gain related to
our investments in nuclear decommissioning trust funds.
(millions,
except per share amounts)
|
1Q16
|
2Q16
|
3Q16
|
4Q16
|
YTD
2016
|
2
|
Reported
earnings
|
$524
|
$452
|
|
|
$976
|
|
Adjustments to
reported earnings 1:
|
|
|
|
|
|
|
Pre-tax loss (income)
|
67
|
(12)
|
|
|
55
|
|
Income tax
|
(19)
|
1
|
|
|
(18)
|
|
|
|
48
|
(11)
|
|
|
37
|
|
Operating
earnings
|
$572
|
$441
|
|
|
$1,013
|
|
Common shares
outstanding (average, diluted)
|
598.2
|
617.0
|
|
|
607.6
|
|
Reported earnings
per share
|
$0.88
|
$0.73
|
|
|
$1.61
|
|
Adjustments to
reported earnings (after-tax)
|
|
0.08
|
(0.02)
|
|
|
0.06
|
|
Operating earnings
per share
|
$0.96
|
$0.71
|
|
|
$1.67
|
|
|
|
|
|
|
|
|
|
1) Adjustments to
reported earnings are reflected in the following
table:
|
|
|
|
|
|
|
1Q16
|
2Q16
|
3Q16
|
4Q16
|
YTD
2016
|
|
Pre-tax loss
(income):
|
|
|
|
|
|
|
Organizational design initiative
|
70
|
(5)
|
|
|
65
|
|
Net gain in nuclear decommissioning trust funds
|
(2)
|
(11)
|
|
|
(13)
|
|
Other items
|
(1)
|
4
|
|
|
3
|
|
|
|
$67
|
($12)
|
|
|
$55
|
|
Income
tax:
|
|
|
|
|
|
|
Tax
impact of above adjustments to reported earnings
|
($19)
|
$1
|
|
|
($18)
|
|
|
|
|
|
|
|
|
|
2) YTD EPS may not
equal sum of quarters due to share count differences
|
Schedule 3 - Reconciliation of 2015 Reported Earnings to
Operating Earnings
2015 Earnings (Twelve months ended December 31, 2015)
The $220 million pre-tax net
effect of the adjustments included in 2015 reported earnings, but
excluded from operating earnings, is primarily related to the
following items:
- $85 million charge associated
with Virginia legislation enacted in February that required the
write-off of Virginia Power
prior-period deferred fuel costs during the first quarter of
2015.
- $99 million charge associated
with the asset retirement obligations for ash ponds and landfills
at certain utility generation facilities in connection with the
enactment of EPA coal combustion residuals rules in the second
quarter of 2015.
- $28 million net charge in
connection with the Virginia Commission's final ruling associated
with its biennial review of Virginia
Power's base rates for 2013-2014 test years.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(millions,
except per share amounts)
|
1Q15
|
2Q15
|
3Q15
|
4Q15
|
YTD
2015
|
2
|
Reported
earnings
|
$536
|
$413
|
$593
|
$357
|
$1,899
|
|
Adjustments to
reported earnings 1:
|
|
|
|
|
|
|
Pre-tax
loss (income)
|
76
|
27
|
19
|
98
|
220
|
|
Income
tax
|
(28)
|
(11)
|
(1)
|
(39)
|
(79)
|
|
|
48
|
16
|
18
|
59
|
141
|
|
Operating
earnings
|
$584
|
$429
|
$611
|
$416
|
$2,040
|
|
Common shares
outstanding (average, diluted)
|
589.9
|
592.5
|
595.5
|
596.7
|
593.7
|
|
Reported earnings
per share
|
$0.91
|
$0.70
|
$1.00
|
$0.60
|
$3.20
|
|
Adjustments to
reported earnings (after-tax)
|
0.08
|
0.03
|
0.03
|
0.10
|
0.24
|
|
Operating earnings
per share
|
$0.99
|
$0.73
|
$1.03
|
$0.70
|
$3.44
|
|
|
|
|
|
|
|
|
1) Adjustments to
reported earnings are reflected in the following
table:
|
|
|
|
|
|
|
1Q15
|
2Q15
|
3Q15
|
4Q15
|
YTD
2015
|
|
Pre-tax loss
(income):
|
|
|
|
|
|
|
Write-off of deferred fuel costs
|
85
|
|
|
|
85
|
|
Future ash pond and landfill closure costs
|
|
45
|
|
54
|
99
|
|
Impact of Virginia Power biennial review
|
|
|
|
28
|
28
|
|
Other items
|
(9)
|
(18)
|
19
|
16
|
8
|
|
|
$76
|
$27
|
$19
|
$98
|
$220
|
|
|
|
|
|
|
|
|
Income
tax:
|
|
|
|
|
|
|
Tax
impact of above adjustments to reported earnings
|
(28)
|
(11)
|
(7)
|
(39)
|
(85)
|
|
Deferred taxes refundable to utility customers
|
|
|
6
|
|
6
|
|
|
($28)
|
($11)
|
($1)
|
($39)
|
($79)
|
|
|
|
|
|
|
|
|
2) YTD EPS may not
equal sum of quarters due to share count differences
|
Schedule 4 -
Change in Contribution to Reported and Operating
Earnings
|
|
|
Preliminary,
unaudited
|
Three Months
Ended
|
(millions,
except EPS)
|
June
30,
|
|
2016 vs.
2015
|
|
Increase /
(Decrease)
|
|
Amount
|
|
EPS
|
|
|
|
|
Change in reported
earnings (GAAP)
|
$39
|
|
$0.03
|
|
|
|
|
Change in
Pre-tax loss (income) 1
|
(39)
|
|
|
Change in
Income tax 1
|
12
|
|
|
Adjustments to
reported earnings
|
(27)
|
|
(0.05)
|
|
|
|
|
Change in
consolidated operating earnings
|
$12
|
|
($0.02)
|
|
|
|
|
Reconciling
Items
|
Dominion
Virginia Power
|
|
|
|
Regulated electric
sales:
|
|
|
|
Weather
|
($11)
|
|
($0.02)
|
Other
|
-
|
|
-
|
FERC transmission equity return
|
10
|
|
0.02
|
Storm damage and service restoration
|
(10)
|
|
(0.02)
|
Other
|
(2)
|
|
-
|
Share dilution
|
-
|
|
(0.01)
|
Change in contribution to reported and operating
earnings
|
($13)
|
|
($0.03)
|
|
|
|
|
Dominion
Energy
|
|
|
|
Gas Distribution margin
|
$2
|
|
-
|
Farmout transaction
|
21
|
|
0.04
|
Retail energy marketing operations
|
6
|
|
0.01
|
Other
|
4
|
|
-
|
Share dilution
|
-
|
|
(0.01)
|
Change in contribution to reported and operating
earnings
|
$33
|
|
$0.04
|
|
|
|
|
Dominion
Generation
|
|
|
|
Regulated electric sales:
|
|
|
|
Weather
|
($23)
|
|
($0.04)
|
Other
|
5
|
|
0.01
|
Renewable energy investment tax credits
|
(30)
|
|
(0.05)
|
Merchant generation margin
|
(20)
|
|
(0.03)
|
Rate adjustment clause equity return
|
10
|
|
0.02
|
Capacity related expenses
|
26
|
|
0.04
|
Outage costs
|
(24)
|
|
(0.04)
|
Other
|
(23)
|
|
(0.04)
|
Share dilution
|
-
|
|
(0.01)
|
Change in contribution to reported and operating
earnings
|
($79)
|
|
($0.14)
|
|
|
|
|
Corporate and
Other
|
|
|
|
Renewable energy investment tax credits
|
$47
|
|
$0.07
|
Other
|
24
|
|
0.04
|
Change in contribution to operating earnings
|
$71
|
|
$0.11
|
|
|
|
|
Change in
consolidated operating earnings
|
$12
|
|
($0.02)
|
Change in adjustments
included in reported earnings1
|
27
|
|
0.05
|
Change in
consolidated reported earnings
|
$39
|
|
$0.03
|
|
|
|
|
1) Adjustments to reported earnings are included in
Corporate and Other segment reported GAAP
earnings.
|
Refer to Schedules 2 and 3
for details, or find "GAAP Reconciliation" in the Earnings Release
Kit on Dominion's
website at
www.dom.com/investors.
|
Note: Figures may not
add due to rounding.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/dominion-announces-second-quarter-earnings-300308008.html
SOURCE Dominion Resources