Crude Oil ( ) Brent Crude ( ) Natural Gas ( ) S&P 500 ( ) PHLX Oil ( )
 October 26, 2015 - 6:37 AM EDT
Print Email Article Font Down Font Up
Pepco Holdings Reports Third Quarter 2015 Financial Results

Pepco Holdings, Inc. (NYSE: POM) today reported third quarter and nine months ended September 30, 2015 consolidated earnings as follows:

   

Three Months Ended
September 30,

Nine Months Ended
September 30,

2015

 

2014

2015

 

2014

Net Income (GAAP)
Net Income ($ in millions) $ 91 $ 79 $ 197 $ 207
Earnings Per Share $ 0.36 $ 0.31 $ 0.78 $ 0.82
 
Adjusted Net Income (Non-GAAP)
Adjusted Net Income ($ in millions) $ 83 $ 116 $ 201 $ 262
Adjusted Earnings Per Share $ 0.33 $ 0.46 $ 0.80 $ 1.04
 

“While we are disappointed with the decision by the Public Service Commission of the District of Columbia denying our merger application in August, we were pleased to announce the settlement agreement signed earlier this month by Pepco Holdings, Exelon, the District of Columbia government, the Office of the People’s Counsel and other interested parties,” said Joseph M. Rigby, Chairman, President and Chief Executive Officer. “We believe the settlement agreement addresses the issues raised in the Commission’s denial order, and provides significant benefits to our customers and the communities we serve.” Rigby added, “Our earnings continue to be impacted by increased operation and maintenance costs, primarily driven by higher system maintenance costs and the implementation of a new customer information system. We continue to invest and spend to further improve electric system reliability while our merger with Exelon is pending.”

Pepco Holdings’ GAAP net income for the three-month period ended September 30, 2015, was $91 million, or 36 cents per share as compared to $79 million, or 31 cents per share for the same quarter in 2014. Excluding items that we believe are not representative of ongoing business operations, adjusted earnings for the third quarter of 2015 would have been $83 million, or 33 cents per share as compared to $116 million, or 46 cents per share for the quarter ending September 30, 2014.

The primary drivers of the decrease in adjusted net income (Non-GAAP) in the third quarter of 2015, as compared to the same quarter in 2014, were higher operation and maintenance expense (primarily due to increased distribution system maintenance, increased employee-related costs and the implementation of a new customer information system), lower unbilled revenue associated with Atlantic City Electric basic generation service, lower network transmission revenue (mainly due to an increase in refund reserves related to a return on equity challenge), higher utility property taxes and lower Pepco Energy Services tax benefits (due to a favorable adjustment in 2014). Higher electric distribution revenue primarily due to the effects of warmer weather in 2015 partially offset the decrease for the third quarter.

For the nine months ended September 30, 2015, Pepco Holdings’ GAAP earnings were $197 million, or 78 cents per share, as compared to net income of $207 million, or 82 cents per share for the nine months ended September 30, 2014. Excluding items that we believe are not representative of ongoing business operations, adjusted earnings for the nine months ended September 30, 2015 would have been $201 million, or 80 cents per share as compared to $262 million, or $1.04 per share for the same period in the prior year.

The decrease in adjusted net income (Non-GAAP) for the nine months ended September 30, 2015, as compared to the 2014 period, was driven by higher operation and maintenance expense (primarily related to the implementation of a new customer information system, increased employee-related costs and increased distribution system maintenance), higher depreciation expense from increased plant investment and higher interest expense. Higher electric distribution revenue (primarily due to higher rates from increased infrastructure investment, as well as favorable weather) partially offset the decrease for the period.

Non-GAAP Financial Information

Management believes the adjusted net income and related per share data are representative of Pepco Holdings’ ongoing business operations. Management uses this information internally to evaluate Pepco Holdings’ period-over-period financial performance and, therefore, believes that this information is useful to investors. The presentation of adjusted net income and related per share data is intended to complement, and should not be considered as an alternative to, reported earnings and related per share data presented in accordance with generally accepted accounting principles in the United States (GAAP).

Reconciliation of GAAP Financial Information to Adjusted Financial Information

   

Net Income (Millions of dollars)

Three Months
Ended
September 30,
Nine Months
Ended
September 30,
2015     2014 2015     2014
Reported (GAAP) Net Income $ 91   $ 79 $ 197   $ 207
Adjustments (after-tax):

--

  Incremental merger-related transaction costs 1 3 10 17

--

Incremental merger-related integration costs 1 2 4 6

--

Impairment loss related to Pepco Energy Services (PES) long-lived assets

32 32

--

Change in fair value of derivative related to preferred stock (10 )     (10 )    
Adjusted Net Income (Non-GAAP) $ 83     $ 116 $ 201     $ 262
 
 

Earnings per Share

Three Months
Ended
September 30,
Nine Months
Ended
September 30,
2015     2014 2015     2014
Reported (GAAP) Earnings per Share $ 0.36 $ 0.31 $ 0.78 $ 0.82
Adjustments (after-tax):

--

Incremental merger-related transaction costs 0.01 0.01 0.04 0.07

--

Incremental merger-related integration costs 0.01 0.02 0.02

--

Impairment loss related to PES long-lived assets 0.13 0.13

--

Change in fair value of derivative related to preferred stock (0.04 )     (0.04 )    
Adjusted Earnings per Share (Non-GAAP) $ 0.33     $ 0.46 $ 0.80     $ 1.04
 

The income tax effects with respect to the foregoing adjustments, where applicable, were calculated using a composite income tax rate of approximately 40 percent. Most merger-related costs are not tax deductible.

Recent Events

Pepco Holdings – Exelon Merger

  • On October 6, 2015, Exelon and Pepco Holdings entered into a Nonunanimous Full Settlement Agreement and Stipulation (DC Settlement) with the District of Columbia Government, the Office of the People’s Counsel and other parties. A motion to reopen the merger proceeding to consider the DC Settlement was filed with the District of Columbia Public Service Commission (DCPSC) that same day. Among other things, the DC Settlement requires a final order, on conditions consistent with the terms of the settlement agreement, be issued by the DCPSC within 150 days of the filing of the motion to reopen the merger proceeding. District of Columbia law does not impose a time limit on the DCPSC’s review of the merger application.
  • On October 6, 2015, Exelon and Pepco Holdings agreed that neither party will exercise termination rights under the merger agreement on or after October 29, 2015, unless certain conditions of the DC Settlement are not met, including issuance of a procedural schedule and a final order by the DCPSC approving the merger based on timeframes and conditions set forth in the DC Settlement.
  • On October 15, 2015, the New Jersey Board of Public Utilities issued an order extending the effectiveness of its merger approval until June 30, 2016.

Operations

  • Power Delivery electric sales were 13,249 gigawatt hours (GWh) in the third quarter of 2015, compared to 12,780 GWh for the same period in 2014. In the electric service territory, cooling degree days increased by 19 percent for the three months ended September 30, 2015, compared to the same period in 2014. Weather-adjusted electric sales were 12,932 GWh in the third quarter of 2015, compared to 12,984 GWh for the same period in the prior year.
  • Power Delivery electric sales were 37,125 GWh for the nine months ended September 30, 2015 compared to 36,219 GWh for the nine months ended September 30, 2014. In the electric service territory, cooling degree days increased by 23 percent for the nine months ended September 30, 2015, compared to the same period in 2014. Weather-adjusted electric sales were 35,883 GWh for the nine months ended September 30, 2015 compared to 35,929 GWh for the same period in 2014.
  • Pepco Holdings’ capital expenditures for the nine months ended September 30, 2015 were $855 million. Due to the pending merger with Exelon, new distribution rate cases have not been filed since March 2014, although capital expenditures and operation and maintenance expenses have continued or increased from levels in prior periods.
  • In the nine months ended September 30, 2015, PES signed $29 million in energy efficiency contracts and $38 million in underground transmission construction contracts. PES signed $33 million in energy efficiency contracts and $53 million in underground transmission construction contracts for the same period in 2014.

Financing

  • On July 30, 2015, Pepco Holdings entered into a $300 million unsecured term loan agreement due July 28, 2016. The net proceeds were used to repay outstanding commercial paper and for general corporate purposes.

Further details regarding changes in consolidated earnings between 2015 and 2014 are provided in the schedules that follow. Additional information regarding financial results and recent regulatory events can be found in the Pepco Holdings, Inc. Form 10-Q for the quarter ended September 30, 2015, as filed with the Securities and Exchange Commission, and which is also available at www.pepcoholdings.com/investors. Pepco Holdings, Inc. routinely makes available this and other important information on its website, which is a key channel of distribution for Pepco Holdings, Inc. to reach its public investors and to disclose material, non-public information. Information on the website is not part of this news release.

About PHI: Pepco Holdings, Inc. (NYSE: POM) is one of the largest energy delivery companies in the Mid-Atlantic region, serving about 2 million customers in Delaware, the District of Columbia, Maryland and New Jersey. PHI subsidiaries Pepco, Delmarva Power and Atlantic City Electric provide regulated electricity service; Delmarva Power also provides natural gas service. Through Pepco Energy Services, PHI also provides energy savings performance contracting services, underground transmission and distribution construction and maintenance services, and steam and chilled water under long-term contracts.

Forward-Looking Statements: Some of the statements contained in this news release with respect to Pepco Holdings, Pepco, Delmarva Power and Atlantic City Electric, including each of their respective subsidiaries (each, a “Reporting Company”), are forward-looking statements within the meaning of the U.S. federal securities laws, and are subject to the safe harbor created thereby under the Private Securities Litigation Reform Act of 1995. You can identify forward-looking statements by terminology such as “may,” “might,” “will,” “should,” “could,” “expects,” “intends,” “assumes,” “seeks to,” “plans,” “anticipates,” “believes,” “projects,” “estimates,” “predicts,” “potential,” “future,” “goal,” “objective,” or “continue” or the negative of such terms or other variations thereof or comparable terminology, or by discussions of strategy that involve risks and uncertainties. Forward-looking statements involve estimates, assumptions, known and unknown risks, uncertainties and other factors that may cause one or more Reporting Company’s or their subsidiaries’ actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements. Therefore, forward-looking statements are not guarantees or assurances of future performance, and actual results could differ materially from those indicated by the forward-looking statements. These factors should be read together with the risk factors included in the “Risk Factors” section and other statements contained in each Reporting Company’s Annual Report on Form 10-K for the year ended December 31, 2014, filed with the Securities and Exchange Commission on February 27, 2015, and in each Reporting Company’s Quarterly Reports on Form 10-Q for the quarter ended September 30, 2015, and investors should refer to these risk factor sections and other statements. All of such factors and forward-looking statements are difficult to predict, contain uncertainties, are beyond each Reporting Company’s control and may cause actual results to differ materially from those contained in any forward-looking statements. Any forward-looking statements speak only as to the date this news release was issued, and none of the Reporting Companies undertakes any obligation to update any forward-looking statements to reflect events or circumstances after the date on which such statements are made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for a Reporting Company to predict all such factors. Furthermore, it may not be possible to assess the impact of any such factor on such Reporting Company’s or its subsidiaries’ business (viewed independently or together with the business or businesses of some or all of the other Reporting Companies or their subsidiaries) or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement. Any specific factors that may be provided should not be construed as exhaustive.

 
Pepco Holdings, Inc.
Earnings Per Share Variance
2015 / 2014
         
Three Months Ended September 30,
 
Power Pepco Energy Corporate Total
Delivery   Services   and Other   PHI
2014 Earnings (loss) per share (GAAP) (1)

$

0.44

$

(0.10

)

$

(0.03

) $ 0.31
 

2014 Adjustments (2)

--

Incremental merger-related transaction costs

- - 0.01 0.01

--

Incremental merger-related integration costs

0.01 - - 0.01

--

Impairment loss related to PES long-lived assets

- 0.13 - 0.13
                   
 
2014 Adjusted earnings (loss) per share (Non-GAAP) 0.45 0.03 (0.02 ) 0.46
 

Change from 2014 Adjusted earnings (loss) per share

Regulated Operations

--

Distribution Revenue

- Weather (estimate) (3) 0.03 - - 0.03
- Rate Increases 0.01 - - 0.01
- Other Distribution Revenue (0.01 ) - - (0.01 )

--

ACE Basic Generation Service (primarily unbilled revenue)

(0.03 ) - - (0.03 )

--

Network Transmission Revenue

(0.02 ) - - (0.02 )

--

Operation and Maintenance

(0.05 ) - - (0.05 )

--

Depreciation and Amortization

(0.01 ) - - (0.01 )

--

Other, net

(0.02 ) - - (0.02 )
Pepco Energy Services - (0.01 ) - (0.01 )
Corporate and Other - - 0.01 0.01
Net Interest Expense (0.01 ) - - (0.01 )
Income Tax Adjustments   -       (0.02 )     -       (0.02 )
 
2015 Adjusted earnings (loss) per share (Non-GAAP) 0.34 - (0.01 ) 0.33
 

2015 Adjustments (2)

--

Incremental merger-related transaction costs

- - (0.01 ) (0.01 )

--

Incremental merger-related integration costs

- - - -

--

Change in fair value of derivative related to preferred stock

  -       -       0.04       0.04  
 
2015 Earnings per share (GAAP) (4)

$

0.34

   

$

-

   

$

0.02

    $ 0.36  
 
(1) The 2014 weighted average number of diluted shares outstanding was 252 million.
 
(2) Management believes the adjusted items are not representative of the Company's ongoing business operations. The presentation of this Non-GAAP financial information is intended to complement, and should not be considered an alternative to, the GAAP information.
 
(3) The effect of weather compared to the 20-year average weather is estimated to have increased earnings by $0.01 per share.
 
(4) The 2015 weighted average number of diluted shares outstanding was 254 million.

 
Pepco Holdings, Inc.
Earnings Per Share Variance
2015 / 2014
           
Nine Months Ended September 30,
 
Power Pepco Energy Corporate Total
Delivery   Services   and Other   PHI
2014 Earnings (loss) per share (GAAP) (1) $ 1.04 $ (0.10 ) $ (0.12 ) $ 0.82
 

2014 Adjustments (2)

--

Incremental merger-related transaction costs

- - 0.07 0.07

--

Incremental merger-related integration costs

0.02 - - 0.02

--

Impairment loss related to PES long-lived assets

-     0.13     -     0.13  
 
2014 Adjusted earnings (loss) per share (Non-GAAP) 1.06 0.03 (0.05 ) 1.04
 

Change from 2014 Adjusted earnings (loss) per share

Regulated Operations

--

Distribution Revenue

- Weather (estimate) (3) 0.05 - - 0.05
- Rate Increases 0.08 - - 0.08
- Other Distribution Revenue 0.01 - - 0.01

--

Network Transmission Revenue

(0.01 ) - - (0.01 )

--

ACE Basic Generation Service (primarily unbilled revenue)

(0.02 ) - - (0.02 )

--

Operation and Maintenance

(0.23 ) - - (0.23 )

--

Depreciation and Amortization

(0.04 ) - - (0.04 )

--

Other, net

(0.02 ) - - (0.02 )
Pepco Energy Services - (0.01 ) - (0.01 )
Corporate and Other - - (0.01 ) (0.01 )
Net Interest Expense (0.03 ) - - (0.03 )
Dilution (0.01 )   -     -     (0.01 )
 
2015 Adjusted earnings (loss) per share (Non-GAAP) 0.84 0.02 (0.06 ) 0.80
 

2015 Adjustments (2)

--

Incremental merger-related transaction costs

- - (0.04 ) (0.04 )

--

Incremental merger-related integration costs

(0.02 ) - - (0.02 )

--

Change in fair value of derivative related to preferred stock

-     -     0.04     0.04  
 
2015 Earnings (loss) per share (GAAP) (4) $ 0.82     $ 0.02     $ (0.06 )   $ 0.78  
 
(1) The 2014 weighted average number of diluted shares outstanding was 252 million.
 
(2) Management believes the adjusted items are not representative of the Company's ongoing business operations. The presentation of this Non-GAAP financial information is intended to complement, and should not be considered an alternative to, the GAAP information.
 
(3) The effect of weather compared to the 20-year average weather is estimated to have increased earnings by $0.05 per share.
 
(4) The 2015 weighted average number of diluted shares outstanding was 254 million.
 

SEGMENT INFORMATION

 
Three Months Ended September 30, 2015
(millions of dollars)
Power
Delivery
  Pepco
Energy
Services
  Corporate

and
Other (a)

  PHI
Consolidated
Operating Revenue $ 1,316 $ 47 $ (1 ) $ 1,362

Operating Expenses (b)

1,131 49 (1 ) 1,179

Operating Income (Loss)

 

185

 

(2

)

 

-

 

 

183

Interest Expense 59 - 12 71
Other Income 11 -

17

(c)

28
Income Tax Expense (Benefit) 49 (2 ) 2 49
Net Income 88 - 3 91
Total Assets 14,330 218 2,009 16,557
Construction Expenditures $ 286 $ - $ 7 $ 293
 
(a) Total Assets in this column includes Pepco Holdings’ goodwill balance of $1.4 billion, all of which is allocated to Power Delivery for purposes of assessing impairment. Total assets also include capital expenditures related to certain hardware and software expenditures which primarily benefit Power Delivery. These expenditures are recorded as incurred in Corporate and Other and are allocated to Power Delivery once the assets are placed in service. Corporate and Other includes intercompany amounts of $(1) million for Operating Revenue, $1 million for Operating Expenses, $(1) million for Interest and Dividend Income.
(b) Includes depreciation and amortization expense of $178 million, consisting of $165 million for Power Delivery, $1 million for Pepco Energy Services and $12 million for Corporate and Other.
(c) Includes $15 million ($10 million after-tax) increase in fair value of preferred stock derivative.

 
Three Months Ended September 30, 2014
(millions of dollars)
Power
Delivery
  Pepco
Energy
Services
  Corporate

and
Other (a)

  PHI
Consolidated
Operating Revenue $ 1,242 $ 73 $ (2 ) $ 1,313

Operating Expenses (b)

 

1,021

 

126

(c)

 

-

 

1,147

Operating Income (Loss) 221 (53 ) (2 ) 166
Interest Expense 58 1 9 68
Other Income 14 1 - 15
Income Tax Expense (Benefit) 65 (26 ) (5 ) 34
Net Income (Loss) 112 (27 ) (6 ) 79
Total Assets 13,697 255 1,346 15,298
Construction Expenditures $ 272 $ 1 $ 20 $ 293
 
(a) Total Assets in this column includes Pepco Holdings’ goodwill balance of $1.4 billion, all of which is allocated to Power Delivery for purposes of assessing impairment. Total assets also include capital expenditures related to certain hardware and software expenditures which primarily benefit Power Delivery. These expenditures are recorded as incurred in Corporate and Other and are allocated to Power Delivery once the assets are placed in service. Corporate and Other includes intercompany amounts of $(2) million for Operating Revenue, $(1) million for Operating Expenses, $(2) million for Interest Expense and $(2) million for Interest Income.
(b) Includes depreciation and amortization expense of $145 million, consisting of $135 million for Power Delivery, $2 million for Pepco Energy Services and $8 million for Corporate and Other.
(c) Includes an impairment loss of $53 million ($32 million after-tax) at Pepco Energy Services associated with its combined heat and power thermal generating plant and operation assets in Atlantic City.

SEGMENT INFORMATION – continued

  Nine Months Ended September 30, 2015
(millions of dollars)
Power
Delivery
  Pepco
Energy
Services
  Corporate

and
Other (a)

  PHI
Consolidated
Operating Revenue $ 3,707 $ 170 $ (4 ) $ 3,873
Operating Expenses (b)

3,238

172 (1 ) 3,409
Operating Income (Loss) 469 (2 ) (3 ) 464
Interest Expense 177 - 33 210
Other Income 32 -

17

(c)

49
Income Tax Expense (Benefit) 113 (7 ) - 106
Net Income (Loss) 211 5 (19 ) 197
Total Assets 14,330 218 2,009 16,557
Construction Expenditures $ 832 $ 2 $ 21 $ 855
 
(a) Total Assets in this column includes Pepco Holdings’ goodwill balance of $1.4 billion, all of which is allocated to Power Delivery for purposes of assessing impairment. Total assets also include capital expenditures related to certain hardware and software expenditures which primarily benefit Power Delivery. These expenditures are recorded as incurred in Corporate and Other and are allocated to Power Delivery once the assets are placed in service. Corporate and Other includes intercompany amounts of $(4) million for Operating Revenue, $(4) million for Operating Expenses, $(2) million for Interest Expense and $(5) million for Interest and Dividend Income.
(b) Includes depreciation and amortization expense of $494 million, consisting of $459 million for Power Delivery, $2 million for Pepco Energy Services and $33 million for Corporate and Other.
(c) Includes $15 million ($10 million after-tax) increase in fair value of preferred stock derivative.

 
Nine Months Ended September 30, 2014
(millions of dollars)
Power
Delivery
  Pepco
Energy
Services
  Corporate

and
Other (a)

  PHI
Consolidated
Operating Revenue $ 3,554 $ 212 $ (6 ) $ 3,760
Operating Expenses (b) 3,005

263

(c)

2 3,270
Operating Income (Loss) 549 (51 ) (8 ) 490
Interest Expense 169 1 30 200
Other Income 39 2 1 42
Income Tax Expense (Benefit) 157 (25 ) (7 ) 125
Net Income (Loss) 262 (25 ) (30 ) 207
Total Assets 13,697 255 1,346 15,298
Construction Expenditures $ 789 $ 2 $ 55 $ 846
 
(a) Total Assets in this column includes Pepco Holdings’ goodwill balance of $1.4 billion, all of which is allocated to Power Delivery for purposes of assessing impairment. Total assets also include capital expenditures related to certain hardware and software expenditures which primarily benefit Power Delivery. These expenditures are recorded as incurred in Corporate and Other and are allocated to Power Delivery once the assets are placed in service. Corporate and Other includes intercompany amounts of $(6) million for Operating Revenue, $(5) million for Operating Expenses, $(2) million for Interest Expense and $(3) million for Interest Income.
(b) Includes depreciation and amortization expense of $410 million, consisting of $381 million for Power Delivery, $6 million for Pepco Energy Services and $23 million for Corporate and Other.
(c) Includes an impairment loss of $53 million ($32 million after-tax) at Pepco Energy Services associated with its combined heat and power thermal generating plant and operation assets in Atlantic City.
 
PEPCO HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,
2015   2014 2015   2014
(millions of dollars, except per share data)
 
Operating Revenue $ 1,362   $ 1,313  

$

3,873

  $ 3,760  
 
Operating Expenses
Fuel and purchased energy 580 545 1,651 1,622
Other services cost of sales 37 54 131 161
Other operation and maintenance 257 242 772 679
Depreciation and amortization 178 145 494 410
Other taxes 114 109 327 315
Deferred electric service costs 13 (1 ) 34 30

Impairment loss

-

 

53

 

 

-

 

53

 
 
Total Operating Expenses 1,179   1,147   3,409   3,270  
 
Operating Income 183   166   464   490  
 
Other Income (Expenses)
Interest expense (71 ) (68 ) (210 ) (200 )
Other income 28   15   49   42  
 
Total Other Expenses (43 ) (53 ) (161 ) (158 )
 
Income Before Income Tax Expense 140 113 303 332
 
Income Tax Expense 49   34   106   125  
 
Net Income $ 91   $ 79   $ 197   $ 207  
 
Basic and Diluted Share Information
Weighted average shares outstanding – Basic (millions) 254   252   253   251  
 
Weighted average shares outstanding – Diluted (millions) 254   252   254   252  
 
Basic and Diluted earnings per share $ 0.36   $ 0.31   $ 0.78   $ 0.82  

   
PEPCO HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
 
September 30,

2015

December 31,
2014
(millions of dollars)
ASSETS
 
CURRENT ASSETS
Cash and cash equivalents $ 271 $ 14
Restricted cash equivalents 18 25
Accounts receivable, less allowance for uncollectible accounts of $58 million and $40 million, respectively 947 782
Inventories 142 141
Deferred income tax assets, net 70 50
Income taxes and related accrued interest receivable 11 9
Prepaid expenses and other   87     63  
Total Current Assets   1,546     1,084  
 
OTHER ASSETS
Goodwill 1,406 1,407
Regulatory assets 2,294 2,409
Income taxes and related accrued interest receivable 81 81
Restricted cash equivalents 15 14
Other   178     166  
Total Other Assets   3,974     4,077  
 
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment 15,989 15,465
Accumulated depreciation   (4,952 )   (4,959 )
Net Property, Plant and Equipment   11,037     10,506  
 
TOTAL ASSETS $ 16,557   $ 15,667  

   
PEPCO HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)        
 

September 30,
2015

December 31,
2014
(millions of dollars, except shares)
LIABILITIES AND EQUITY
 
CURRENT LIABILITIES
Short-term debt $ 1,128 $ 729
Current portion of long-term debt and project funding 300 431
Accounts payable 205 174
Accrued liabilities 300 313
Capital lease obligations due within one year 11 10
Taxes accrued 40 41
Interest accrued 76 47
Liabilities and accrued interest related to uncertain tax positions 6 6
Other   274     314  
Total Current Liabilities   2,340     2,065  
 
DEFERRED CREDITS
Regulatory liabilities 348 343
Deferred income tax liabilities, net 3,415 3,266
Investment tax credits 14 16
Pension benefit obligation 443 396
Other postretirement benefit obligations 236 265
Liabilities and accrued interest related to uncertain tax positions 2 2
Other   196     193  
 
Total Deferred Credits   4,654     4,481  
 
OTHER LONG-TERM LIABILITIES
Long-term debt 4,845 4,441
Transition bonds issued by ACE Funding 138 171
Long-term project funding 4 8
Capital lease obligations   45     50  
 
Total Other Long-Term Liabilities   5,032     4,670  
 
COMMITMENTS AND CONTINGENCIES
 
PREFERRED STOCK
Series A preferred stock, $.01 par value, 18,000 shares authorized, 18,000 and 12,600 shares outstanding, respectively   183     129  
 
EQUITY
Common stock, $.01 par value, 400,000,000 shares authorized, 253,590,612 and 252,728,684 shares outstanding, respectively 3 3
Premium on stock and other capital contributions 3,830 3,800
Accumulated other comprehensive loss (41 ) (46 )
Retained earnings   556     565  
 
Total Equity   4,348     4,322  
 
TOTAL LIABILITIES AND EQUITY $ 16,557   $ 15,667  
 
POWER DELIVERY SALES AND REVENUE
   

 

  Three Months Ended
September 30,
  Nine Months Ended
September 30,
Power Delivery Sales (Gigawatt Hours)   2015     2014   2015     2014
Regulated T&D Electric Sales    
Residential 5,200 4,769 14,593 13,441
Commercial and industrial 7,999 7,953 22,365 22,596
Transmission and other 50 58 167 182
Total Regulated T&D Electric Sales 13,249 12,780 37,125 36,219
 
Default Electricity Supply Sales
Residential 4,213 3,868 11,948 10,835
Commercial and industrial 1,496 1,613 4,240 4,175
Other 9 12 31 33
Total Default Electricity Supply Sales 5,718 5,493 16,219 15,043
 
 
Power Delivery Electric Revenue (Millions of dollars)
Regulated T&D Electric Revenue
Residential $ 279 $ 251 $ 714 $ 640
Commercial and industrial 289 286 803 768
Transmission and other 104 113 325 328
Total Regulated T&D Electric Revenue $ 672 $ 650 $ 1,842 $ 1,736
 
Default Electricity Supply Revenue
Residential $ 421 $ 366 $ 1,152 $ 1,025
Commercial and industrial 154 156 429 429
Other 32 37 111 175
Total Default Electricity Supply Revenue $ 607 $ 559 $ 1,692 $ 1,629
 
Other Electric Revenue $ 18 $ 13 $ 43 $ 44
 
Total Electric Operating Revenue $ 1,297 $ 1,222 $ 3,577 $ 3,409
 
 
Power Delivery Gas Sales and Revenue
Regulated Gas Sales (Mcf)
Residential 377 404 6,311 6,114
Commercial and industrial 734 745 4,409 4,285
Transportation and other 1,144 1,075 4,716 4,737
Total Regulated Gas Sales 2,255 2,224 15,436 15,136
 
Regulated Gas Revenue (Millions of dollars)
Residential $ 8 $ 9 $ 73 $ 77
Commercial and industrial 5 6 39 44
Transportation and other 2 2 8 8
Total Regulated Gas Revenue $ 15 $ 17 $ 120 $ 129
 
Other Gas Revenue $ 4 $ 3 $ 10 $ 16
 
Total Gas Operating Revenue $ 19 $ 20 $ 130 $ 145
 
Total Power Delivery Operating Revenue $ 1,316 $ 1,242 $ 3,707 $ 3,554

   
POWER DELIVERY – CUSTOMERS

September 30,
2015

   

September 30,
2014

 
Regulated T&D Electric Customers (in thousands)
Residential 1,685 1,656
Commercial and industrial 200 199
Transmission and other 2 2
Total Regulated T&D Electric Customers 1,887 1,857
 
 
Regulated Gas Customers (in thousands)
Residential 119 117
Commercial and industrial 10 9
Transportation and other
Total Regulated Gas Customers 129 126
 

WEATHER DATA - CONSOLIDATED ELECTRIC SERVICE TERRITORY

 
  Three Months Ended
September 30,
    Nine Months Ended
September 30,
2015   2014

 

  2015   2014
     
Heating Degree Days 1 17 3,005 3,026
20 Year Average 26 26 2,739 2,740
Percentage Difference from Average (96%) (35%) 10% 10%
Percentage Difference from Prior Year (94%) (1%)
 
Cooling Degree Days 1,081 912 1,630 1,329
20 Year Average 974 972 1,364 1,364
Percentage Difference from Average 11% (6%) 20% (3%)
Percentage Difference from Prior Year 19% 23%
 
PEPCO ENERGY SERVICES
Financial Information
(Unaudited)  
 
(Millions of Dollars)

Three Months Ended
September 30,

  2015       2014  
 
Operating Revenues $ 47 $ 73
Cost of Goods Sold   37     56  
Gross Margin 10 17
Other Operation and Maintenance Expenses 11 15
Impairment Loss

53

*

Depreciation and Amortization   1     2  
Operating Loss (2 ) (53 )
Other Income        
Loss Before Income Taxes (2 ) (53 )
Income Tax Benefit   (2 )   (26 )
Net Income (Loss) (GAAP) $   $ (27 )
 

*Impairment loss of $53 million ($32 million after-tax) associated with the combined heat and power thermal generating plant and operation assets in Atlantic City.

 
(Millions of Dollars)

Nine Months Ended
September 30,

  2015       2014  
 
Operating Revenues $ 170 $ 212
Cost of Goods Sold   132     165  
Gross Margin 38 47
Other Operation and Maintenance Expenses 38 39
Impairment Loss

53

*

Depreciation and Amortization   2     6  
Operating Loss (2 ) (51 )
Other Income       1  
Loss Before Income Taxes (2 ) (50 )
Income Tax Benefit   (7 )   (25 )
Net Income (Loss) (GAAP) $ 5   $ (25 )
 

*Impairment loss of $53 million ($32 million after-tax) associated with the combined heat and power thermal generating plant and operation assets in Atlantic City.

   
(Millions of Dollars) September 30, December 31,
2015 2014
 
Total Assets $ 218 $ 244
Current Assets 124 146
Property, Plant and Equipment 28 30
Other Assets 66 68
 
Total Liabilities $ 61 $ 90
Current Liabilities 39 64
Long-Term Liabilities 22 26
 
Equity $ 157 $ 154

Pepco Holdings, Inc.
Media Contact:
Robert Hainey, 202-872-2680
24/7 Media Hotline 202-872-2680
rshainey@pepcoholdings.com
or
Investor Contact:
Donna Kinzel, 302-429-3004
donna.kinzel@pepcoholdings.com


Source: Business Wire (October 26, 2015 - 6:37 AM EDT)

News by QuoteMedia
www.quotemedia.com