Settlement Stipulation signed on Canyon Creek acquisition and on
changes to Wexpro model;
Tightened 2015 EPS guidance
Questar Corporation (NYSE:STR) reported third-quarter 2015 net income of
$32.6 million, or $0.18 per diluted share compared to third-quarter 2014
net income of $38.6 million, or $0.22 per diluted share. Adjusted
earnings before interest, taxes, depreciation and amortization (Adjusted
EBITDA) for the quarter were $119.3 million compared to $121.1 million
in the year-ago period. Return on average common equity (ROE) was 17.1%
for the 12 months ended September 30, 2015.
|
|
|
NET INCOME (LOSS) BY SUBSIDIARY
|
|
|
|
|
|
3 Months Ended September 30,
|
|
|
2015
|
|
2014
|
|
Change
|
|
|
(in millions, except earnings per share)
|
Questar Gas
|
|
$
|
(8.8
|
)
|
|
$
|
(9.1
|
)
|
|
$
|
0.3
|
|
|
3
|
%
|
Wexpro
|
|
26.9
|
|
|
31.1
|
|
|
(4.2
|
)
|
|
(14
|
%)
|
Questar Pipeline
|
|
15.2
|
|
|
14.9
|
|
|
0.3
|
|
|
2
|
%
|
Corporate and other
|
|
(0.7
|
)
|
|
1.7
|
|
|
(2.4
|
)
|
|
|
NM
|
Total net income
|
|
$
|
32.6
|
|
|
$
|
38.6
|
|
|
$
|
(6.0
|
)
|
|
(16
|
%)
|
Earnings per diluted share
|
|
$
|
0.18
|
|
|
$
|
0.22
|
|
|
$
|
(0.04
|
)
|
|
(18
|
%)
|
Weighted-average diluted shares
|
|
176.3
|
|
|
176.1
|
|
|
0.2
|
|
|
—
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADJUSTED EBITDA BY SUBSIDIARY(a)
|
|
|
|
|
|
3 Months Ended September 30,
|
|
|
2015
|
|
2014
|
|
Change
|
|
|
(in millions)
|
Questar Gas
|
|
$
|
6.2
|
|
|
$
|
5.8
|
|
|
$
|
0.4
|
|
|
7
|
%
|
Wexpro
|
|
66.9
|
|
|
68.4
|
|
|
(1.5
|
)
|
|
(2
|
%)
|
Questar Pipeline
|
|
43.0
|
|
|
43.5
|
|
|
(0.5
|
)
|
|
(1
|
%)
|
Corporate and other
|
|
3.2
|
|
|
3.4
|
|
|
(0.2
|
)
|
|
(6
|
%)
|
Total Adjusted EBITDA
|
|
$
|
119.3
|
|
|
$
|
121.1
|
|
|
$
|
(1.8
|
)
|
|
(1
|
%)
|
(a)
|
|
Management defines Adjusted EBITDA as net income (loss) before gains
and losses from asset sales, interest expense, depreciation,
depletion and amortization, abandonments and impairments, other
special items and income taxes. See computations on the last page of
the attached financial statements.
|
“This has been an important quarter for Questar. Not only is the company
performing in line with our guidance, but several key milestones have
occurred or are in process,” said Ronald W. Jibson, Questar chairman,
president and CEO. “These include a joint-development partnership with
Laramie Energy and the signing of a Settlement Stipulation on our
proposal to regulators to adjust Wexpro’s cost-of-service returns to
enable us to resume our development-drilling program, even in this
low-commodity-price environment. Also, as we have said over the past
year, we have been working with a joint-venture partner to evaluate and
develop oil and gas properties under a cost-of-service arrangement. We
are pleased to announce that Tokyo Gas America is that partner. We look
forward to working with Tokyo Gas America as we pursue growth within
Wexpro Development.”
“In the third quarter, Questar Gas’s normal seasonal net loss was
slightly lower than last year. Wexpro’s income dipped, as expected,
while Questar Pipeline’s income was up slightly compared to last year’s
third quarter. Adjusted EBITDA in the third quarter of 2015 was $119.3
million, down 1% compared to the 2014 quarter. While low commodity
prices and other uncertainties, such as pending tax legislation,
continue to be a challenge, we are tightening our current 2015 earnings
guidance range to $1.25 to $1.30 per diluted share.”
Recent highlights include:
-
Questar Gas’s 12-month customer growth rose by 2.8%, or about 26,600
net new customers, including the addition of more than 6,500 customers
from the acquisition of Eagle Mountain City’s municipal
gas-distribution system in March 2015.
-
Questar Gas invested $19 million in its infrastructure-replacement
program in the quarter and $52 million for the first nine months of
2015.
-
Questar Gas and regulatory intervenors signed a Settlement
Stipulation, subject to approval by the Public Service Commissions of
Utah and Wyoming, to add the recent Canyon Creek acquisition as a
cost-of-service property and to lower the return on future Wexpro
development spending. This could enable Wexpro to resume its
development drilling program in 2016.
-
Wexpro announced a $60 million to $70 million drilling joint venture
with Laramie Energy to develop 80 wells in western Colorado’s Piceance
Basin with the potential to expand to a larger program.
-
Wexpro announced the acquisition of additional Vermillion Basin assets
for $16 million.
-
Questar Pipeline successfully and safely completed the final portion
of the multi-year Mainline-3 replacement project ahead of schedule and
under budget, placing it back into service during the third quarter.
-
Questar Pipeline reduced its combined operating and maintenance (O&M)
and general and administrative (G&A) expenses by 9% for the quarter
through cost controls and improved efficiencies.
-
Questar Fueling opened a new compressed natural gas (CNG) fueling
station in Phoenix, Ariz., its eighth location.
Questar Gas
Questar Gas reported a seasonal net loss of $8.8 million for the third
quarter of 2015 compared to a $9.1 million net loss in the 2014 period.
Questar Gas, because of the seasonal nature of its business, typically
reports losses in the second and third quarter each year. It generated
$6.2 million of Adjusted EBITDA in the 2015 third quarter compared to
$5.8 million for the 2014 quarter. On a financial basis, Questar Gas
earned a 10.2% ROE for the 12 months ended September 30, 2015. The
following table summarizes changes in Questar Gas margin (revenues less
cost of gas sold):
|
|
|
CHANGE IN QUESTAR GAS MARGIN
|
|
|
|
|
|
3 Months Ended September 30, 2015 vs. 2014
|
|
|
(in millions)
|
Customer growth
|
|
$
|
0.9
|
|
Transportation
|
|
0.8
|
|
Change in general-service rates
|
|
0.2
|
|
Infrastructure-replacement cost recovery
|
|
0.3
|
|
Energy-efficiency program cost recovery
|
|
(0.8
|
)
|
Other
|
|
(0.4
|
)
|
Increase
|
|
$
|
1.0
|
|
|
|
|
|
|
As of September 30, 2015, Questar Gas served 981,348 customers, an
increase of 26,594, or 2.8%, including the addition of more than 6,500
customers from the acquisition of Eagle Mountain City’s gas-distribution
system in March 2015. This compares to customer growth of 1.7% over the
same period in 2014. Customer growth continues to accelerate. The
largest increase in Questar Gas’s margin, $0.9 million, resulted from
the addition of new customers during the quarter. Transportation growth
increased margin by $0.8 million from the addition of new transportation
customers and higher transportation rates. The change in general-service
rates added $0.2 million, primarily due to increased rates in Wyoming
under the March 2015 rate order. The infrastructure-replacement
cost-recovery program added $0.3 million in margin. The largest decrease
in margin, $0.8 million, was the result of lower
energy-efficiency-program cost-recovery revenues, which are fully offset
by equivalent reductions in the program's expenses.
Combined O&M and G&A expense is an important measure of the company’s
operating efficiency. Excluding energy-efficiency-program costs,
combined O&M and G&A costs were $34 per customer for the three months
ended September 30, 2015, the same as the 2014 period.
Questar Gas continues to manage a multi-year infrastructure-replacement
program replacing older large-diameter high-pressure pipe and
intermediate high-pressure belt mains. It utilizes an
infrastructure-cost-tracking mechanism approved by the Public Service
Commission of Utah that annually allows up to $65 million in investments
in completed projects to be placed into rate base and earned on without
filing a general rate case. The company expects to spend close to the
allowed $65 million in 2015 and continue at or above this level for the
next several years.
Wexpro
Wexpro's third-quarter 2015 net income fell 14% to $26.9 million,
compared to $31.1 million in the third quarter of 2014. Adjusted EBITDA
fell 2% to $66.9 million in the current quarter versus $68.4 million
last year. Wexpro's total investment base at quarter-end was $616.5
million, 7% lower than the year-ago quarter-end.
Wexpro earned a blended 17.6% after-tax return on its average total
investment base for the 12 months ended September 30, 2015. This is
based on a realized 19.4% return on the original Wexpro investment base
and a 7.6% return on acquired assets in the Wexpro II investment base.
The original 1981 Wexpro Agreement with the Utah and Wyoming Public
Service Commissions allows Wexpro to recover its costs and earn an
unlevered after-tax return, currently 19.76%, on gas-development
drilling. The Wexpro II Agreement, approved in 2014, allows Wexpro to
make acquisitions of energy-development properties and earn the
utility’s cost of capital, currently 7.64%, on the cost of approved
acquisitions.
Wexpro produced 14.6 Bcf of cost-of-service gas for Questar Gas in the
third quarter of 2015, down 5% from 15.4 Bcf in the year-ago quarter.
Cost-of-service production for the year-to-date and trailing 12 months
ended September 30, 2015, amounted to 43.9 Bcf and 55.8 Bcf,
respectively, compared to 51.6 Bcf and 67.3 Bcf over the same periods in
2014. Over the trailing 12 months ended September 30, 2015,
Wexpro-produced natural gas provided just over 60% of the utility's
gas-supply requirement. Oil and natural gas liquids (NGL) sales revenues
decreased 63% in the quarter compared to the same period in 2014 due to
lower production volumes and prices. Questar Gas customers share in oil
and NGL revenues, by way of reduced gas rates, after production expenses
and the allowed returns are covered.
A summary of changes in Wexpro's investment base is provided below:
|
|
|
CHANGE IN WEXPRO INVESTMENT BASE
|
|
|
|
|
|
12 Months Ended September 30, 2015
|
|
|
(in millions)
|
Beginning investment base
|
|
$
|
664.6
|
|
Successful development wells
|
|
32.1
|
|
Depreciation, depletion and amortization
|
|
(87.7
|
)
|
Change in deferred income taxes
|
|
7.5
|
|
Ending investment base
|
|
$
|
616.5
|
|
|
|
|
|
|
Wexpro's operator-service fee was down 2% in the third quarter of 2015,
reflecting reduced returns on the lower investment base and lower
cost-of-service expense reimbursements on declining production. Combined
O&M and G&A expenses were flat in the third quarter of 2015 compared
with the 2014 period. Total operating expenses were up 1% in the third
quarter of 2015 compared to the prior-year quarter.
Wexpro plans to spend an average of $50 million annually on acquisitions
that fit the cost-of-service model in the Wexpro II Agreement and
continues to evaluate acquisition opportunities that could provide
long-lived and low-cost natural gas production. The opportunity for
Wexpro to acquire and develop additional properties can provide
significant long-term benefits to both customers and shareholders.
Future acquisitions and their subsequent development as cost-of-service
properties will help ensure the long-term stability of Wexpro’s
investment base. Utility customers and shareholders can benefit over the
long term from the acquisition and development of such properties,
especially those located close to Questar Gas’s market area.
Settlement Stipulation signed to add Canyon Creek acquisition to
Wexpro II and change Wexpro model
Wexpro continues to develop strategies that enable the company to resume
its drilling program in 2016. Market prices for natural gas have
declined significantly resulting in Wexpro's current cost-of-service
price exceeding the market price. Consequently, Wexpro scaled back its
gas development drilling program in 2015 and limited its investment to
the completion of wells drilled in 2014. Wexpro designs its annual
drilling program to provide cost-of-service production that is, on
average, at or below the current five-year Rockies-adjusted NYMEX
forward price curve. Based on current natural gas market prices it would
be difficult for new drilling under existing Wexpro I and Wexpro II
agreements to meet this standard.
In December 2014, Wexpro acquired an additional interest in its existing
Wexpro-operated assets in the Canyon Creek Unit of southwestern
Wyoming's Vermillion Basin for approximately $52 million. Under the
terms of the Wexpro II Agreement, these properties must be submitted to
the Public Service Commission of Utah (PSCU) and the Wyoming Public
Service Commission (PSCW) to be considered for cost-of-service treatment
for the benefit of Questar Gas customers.
As previously reported, in August 2015 Wexpro and Questar Gas submitted
an application to the PSCU and the PSCW for approval to include the
recently acquired Canyon Creek properties under the terms of the Wexpro
II Agreement. As part of this application, Wexpro proposed significant
changes to its cost-of-service program to enable future cost-of-service
gas production to be more competitive with current market prices and to
stimulate its gas-development-drilling program. Wexpro proposed that the
return on post-2015 Development Drilling be lowered to the
Commission-Allowed Rate of Return on investment as defined in the Wexpro
II Agreement, currently 7.64%. The pre-2016 investment base and
associated returns would not be affected. Wexpro also proposed that
dry-hole and non-commercial well costs be shared on a 50%/50% basis
between utility customers and Wexpro, and any annual savings be shared
50%/50% between utility customers and Wexpro when the annual weighted
average price of cost-of service production from Wexpro properties is
lower than the average annual market price.
On October 26, 2015, Questar Gas, Wexpro, the Utah Division of Public
Utilities, the Utah Office of Consumer Services and the Wyoming Office
of Consumer Advocate signed a Settlement Stipulation, which modifies the
proposals contained in the August application in certain respects. If
approved, the Settlement Stipulation will provide Questar Gas customers
with long-term cost-of-service gas supplies that are competitive with
market prices and will allow Wexpro to resume its
gas-development-drilling program. Specifically, the Settlement
Stipulation includes the Canyon Creek acquisition as a Wexpro II
property, and accepts the proposed changes to the cost-of-service
program with the following modifications: (a) Wexpro and Questar Gas
will reduce the maximum combined production from Wexpro properties from
65% of Questar Gas's annual forecasted demand to 55% by 2020; (b) the
costs allocated to utility customers pursuant to the 50%/50% sharing of
dry-hole and non-commercial well costs will be limited to 4.5% of
Wexpro's annual development-drilling-program costs; and (c) Wexpro's 50%
share of any annual savings resulting when the annual price of
cost-of-service production is lower than the annual average market price
will be limited so that Wexpro will not earn a return exceeding that
earned on gas-development investment under the 1981 Wexpro Agreement.
Pursuant to the Settlement Stipulation, the parties agree to support the
Settlement Stipulation during hearings later this month. The terms of
the August application, as well as the proposed modifications
contemplated by the Settlement Stipulation, remain subject to the
approval of both the PSCU and the PSCW. Questar expects that the PSCU
and the PSCW will consider the application before the end of 2015.
However, there can be no assurance that the Canyon Creek acquisition
will be approved as a Wexpro II property, or that any of the proposed
changes to the Wexpro model will be approved.
Wexpro believes that these changes, if approved, would allow the company
to resume its drilling program as early as 2016, enabling Questar Gas
customers to realize the benefit of adding long-term natural gas
reserves at low prices.
Wexpro to acquire additional Vermillion Basin assets for $16 million
Wexpro agreed to acquire working interests in nearly 24,000 acres in the
Vermillion Basin in southwestern Wyoming for $16 million. The purchase
will include interests in 75 producing wells and 112 future drilling
locations in the producing areas. Wexpro expects that production from
these properties will be cost-competitive with its other wells in the
Vermillion Basin, its lowest-cost producing area.
Questar Pipeline
Questar Pipeline’s third-quarter 2015 net income increased 2% to $15.2
million, compared to $14.9 million a year ago. Questar Pipeline
generated $43.0 million of Adjusted EBITDA in the third quarter and
earned a 10.6% ROE for the 12 months ended September 30, 2015. A summary
of changes in Questar Pipeline revenues is provided below:
|
|
|
CHANGE IN QUESTAR PIPELINE REVENUES
|
|
|
|
|
|
3 Months Ended September 30, 2015 vs. 2014
|
|
|
(in millions)
|
Transportation
|
|
$
|
(0.9
|
)
|
Storage
|
|
(0.1
|
)
|
NGL sales
|
|
(1.1
|
)
|
Energy services
|
|
(0.1
|
)
|
Other
|
|
(0.2
|
)
|
Decrease
|
|
$
|
(2.4
|
)
|
|
|
|
|
|
At September 30, 2015, Questar Pipeline held net firm-transportation
contracts totaling 5,107 thousand decatherms (Mdth) per day, up from
5,058 Mdth per day at September 30, 2014. Questar Pipeline’s total
revenues were down 4% in the quarter primarily due to slightly lower
transportation revenues and 61% lower NGL sales caused by significantly
lower market prices compared to the 2014 quarter. Storage, energy
services and other revenues were relatively steady in the third quarter
of 2015 compared to the same period in 2014. Depreciation and
amortization expenses were down 1% from a year ago. Questar Pipeline
continued to implement cost controls and efficiency measures that
resulted in a 9% reduction in combined O&M and G&A costs for the recent
quarter when compared to the same quarter in 2014.
Questar Southern Trails Pipeline
Questar Pipeline and its partner, a unit of Spectra Energy, have not
obtained a suitable site for a rail terminal in Southern California to
support a conversion of the western segment of the Southern Trails
Pipeline to crude-oil transportation. Therefore, development of the
project has been delayed and the project will not meet the previously
targeted in-service date of 2017. Questar and Spectra continue to
explore alternatives to convert all or part of the Southern Trails
Pipeline to transport crude oil. These alternatives include other
possible rail terminal locations or conversion of the entire pipeline to
oil service from the San Juan Basin. Questar is also evaluating options
to sell Southern Trails Pipeline. Conversion alternatives may require
constructing a 110-mile pipeline segment in California to reconnect the
eastern and western segments of Southern Trails. A decision on the
future direction of the project will be made by year-end 2015.
Questar Fueling
Questar Fueling Company continues to develop CNG-fueling stations,
primarily for trucking-fleet applications. The newest station was opened
in Phoenix, Ariz., during the past quarter. Seven other facilities are
currently in operation. Additional locations are in various stages of
development, but the speed of future development will depend on the
needs of current and future transportation customers. Questar continues
to see long-term growth potential for the use of natural gas for
transportation, but the current reduced differential between CNG and
diesel prices has slowed the demand growth. Therefore, Questar is
reducing spending on the development of additional CNG fueling
facilities until demand increases.
Corporate and other
Corporate and other operations, which include Questar Fueling, reported
net loss of $0.7 million in the third quarter of 2015, compared to net
income of $1.7 million in the third quarter of 2014, which reflected
income tax adjustments that increased net income for the 2014 period.
Questar Fueling had a net loss of $0.3 million in the recent quarter,
the same as in the year-ago period.
2015 EPS guidance tightened; Capital guidance reduced
Questar tightened its 2015 EPS guidance range to $1.25 to $1.30 per
diluted share. Questar also updated its 2015 capital investment
forecast. Consolidated capital investment for 2015 was reduced from $370
million to $320 million. The change reflects reduced capital spending at
Wexpro, Questar Pipeline and Corporate, while Questar Gas’s forecast
spending increased slightly. Full-year capital spending is expected to
be as follows:
|
|
|
CAPITAL INVESTMENT FORECAST
|
|
|
|
|
|
2015 Forecast
|
|
|
(in millions)
|
Questar Gas
|
|
$
|
220
|
Wexpro
|
|
45
|
Questar Pipeline
|
|
40
|
Corporate and other
|
|
15
|
Total
|
|
$
|
320
|
|
|
|
|
“We have had resilient year-to-date performance in spite of continued
low commodity prices and limited development opportunities at Wexpro and
Questar Pipeline,” Jibson said. “Still, we expect to deliver full-year
earnings within our tightened guidance range. Strong growth at Questar
Gas coupled with new opportunities at Wexpro and potential opportunities
for Questar Pipeline to support Wexpro’s development efforts bode well
for our future. With the announcement of the partnerships with Laramie
Energy and Tokyo Gas America, Wexpro’s third-party cost-of-service
development efforts are steadily progressing and we have plans for
significant growth in this area. We will continue to invest in the
long-term growth of the company as we strive to provide the quality
service and value that our customers and shareholders have come to, and
have a right to, expect.”
Questar expects to record settlement-accounting costs in the fourth
quarter of 2015 because the pension plan has settled benefits for the
majority of its terminated vested employees and is offering lump-sum
benefits to retirees eligible to receive benefits beginning on or after
January 1, 2015. The amount of the settlement-accounting costs has not
yet been determined and is not included in 2015 EPS guidance, but could
be in the $10 million to $20 million range.
Third-Quarter 2015 earnings teleconference
Questar management will discuss third-quarter 2015 results and the
outlook for the remainder of 2015 in a conference call with investors
Thursday, November 5th, beginning at 9:30 a.m. ET. The call
can be accessed on the company website at www.questar.com.
About Questar Corporation
Questar is a Rockies-based integrated natural gas company with an
enterprise value of about $5.3 billion, operating through three
principal subsidiaries:
-
Questar Gas Company provides retail natural gas distribution in
Utah, Wyoming and Idaho;
-
Wexpro Company develops and produces natural gas from
cost-of-service reserves for Questar Gas customers; and
-
Questar Pipeline Company operates interstate natural gas
pipelines and storage facilities in the western U.S. and provides
other energy services.
Forward-Looking Statements
This document may contain or incorporate by reference information that
includes or is based upon "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.
Forward-looking statements give expectations or forecasts of future
events. You can identify these statements by the fact that they do not
relate strictly to historical or current facts. They use words such as
"anticipate," "estimate," "expect," "project," "intend," "plan,"
"believe," and other words and terms of similar meaning in connection
with a discussion of future operating or financial performance.
Forward-looking statements in this document include, but are not limited
to, Company expectations regarding its ability to resume and maintain a
developmental natural gas drilling program if the application submitted
by Questar Gas is approved. Any or all forward-looking statements may
turn out to be wrong. These statements are based on current expectations
and the current economic environment. They involve a number of risks and
uncertainties that are difficult to predict. Actual results could differ
materially from those expressed or implied in the forward-looking
statements. Factors that could cause actual results to differ materially
include, but are not limited to the following:
-
the risk factors discussed in Part II, Item 1A of the Company's
Quarterly Report on Form 10-Q for the quarter ending June 30, 2015,
and subsequent SEC filings;
-
general economic conditions, including the performance of financial
markets and interest rates;
-
changes in energy commodity prices;
-
changes in industry trends;
-
actions of regulators;
-
changes in laws or regulations; and
-
other factors, most of which are beyond Questar's control.
Questar undertakes no obligation to publicly correct or update the
forward-looking statements in this document, in other documents, or on
the website to reflect future events or circumstances. All such
statements are expressly qualified by this cautionary statement.
For more information, visit Questar's website at www.questar.com.
|
|
|
|
|
|
|
|
|
QUESTAR CORPORATION
|
CONSOLIDATED STATEMENTS OF INCOME
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
3 Months Ended
|
|
|
9 Months Ended
|
|
|
12 Months Ended
|
|
|
September 30,
|
|
|
September 30,
|
|
|
September 30,
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
|
2015
|
|
|
2014
|
|
|
(in millions, except per-share amounts)
|
REVENUES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Questar Gas
|
$
|
|
89.3
|
|
|
$
|
|
100.7
|
|
|
$
|
|
605.8
|
|
|
$
|
|
642.0
|
|
|
$
|
|
924.7
|
|
|
$
|
|
979.4
|
|
Wexpro
|
|
6.4
|
|
|
|
9.4
|
|
|
|
22.8
|
|
|
|
29.5
|
|
|
|
28.9
|
|
|
|
42.6
|
|
Questar Pipeline
|
|
45.0
|
|
|
|
47.3
|
|
|
|
138.3
|
|
|
|
143.4
|
|
|
|
185.1
|
|
|
|
190.6
|
|
Other
|
|
1.6
|
|
|
|
0.5
|
|
|
|
3.3
|
|
|
|
1.2
|
|
|
|
4.7
|
|
|
|
1.4
|
|
Total Revenues
|
|
142.3
|
|
|
|
157.9
|
|
|
|
770.2
|
|
|
|
816.1
|
|
|
|
1,143.4
|
|
|
|
1,214.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales (excluding operating expenses shown separately)
|
|
(52.6
|
)
|
|
|
(42.3
|
)
|
|
|
70.2
|
|
|
|
81.6
|
|
|
|
174.9
|
|
|
|
210.1
|
|
Operating and maintenance
|
|
38.6
|
|
|
|
40.5
|
|
|
|
131.4
|
|
|
|
139.9
|
|
|
|
185.7
|
|
|
|
193.1
|
|
General and administrative
|
|
26.5
|
|
|
|
24.7
|
|
|
|
83.3
|
|
|
|
84.2
|
|
|
|
121.8
|
|
|
|
113.9
|
|
Production and other taxes
|
|
12.7
|
|
|
|
16.8
|
|
|
|
39.3
|
|
|
|
53.4
|
|
|
|
52.1
|
|
|
|
65.6
|
|
Depreciation, depletion and amortization
|
|
55.0
|
|
|
|
50.8
|
|
|
|
162.9
|
|
|
|
162.9
|
|
|
|
213.7
|
|
|
|
214.3
|
|
Abandonment and impairment
|
|
—
|
|
|
|
—
|
|
|
|
0.1
|
|
|
|
2.0
|
|
|
|
0.1
|
|
|
|
2.0
|
|
Total Operating Expenses
|
|
80.2
|
|
|
|
90.5
|
|
|
|
487.2
|
|
|
|
524.0
|
|
|
|
748.3
|
|
|
|
799.0
|
|
Net gain from asset sales
|
|
0.2
|
|
|
|
1.5
|
|
|
|
1.6
|
|
|
|
1.6
|
|
|
|
1.2
|
|
|
|
1.3
|
|
OPERATING INCOME
|
|
62.3
|
|
|
|
68.9
|
|
|
|
284.6
|
|
|
|
293.7
|
|
|
|
396.3
|
|
|
|
416.3
|
|
Interest and other income
|
|
1.3
|
|
|
|
2.0
|
|
|
|
4.2
|
|
|
|
5.0
|
|
|
|
5.8
|
|
|
|
5.7
|
|
Income from unconsolidated affiliate
|
|
0.9
|
|
|
|
0.9
|
|
|
|
2.8
|
|
|
|
2.7
|
|
|
|
3.6
|
|
|
|
3.6
|
|
Interest expense
|
|
(15.7
|
)
|
|
|
(15.7
|
)
|
|
|
(47.4
|
)
|
|
|
(47.3
|
)
|
|
|
(63.2
|
)
|
|
|
(61.5
|
)
|
INCOME BEFORE INCOME TAXES
|
|
48.8
|
|
|
|
56.1
|
|
|
|
244.2
|
|
|
|
254.1
|
|
|
|
342.5
|
|
|
|
364.1
|
|
Income taxes
|
|
(16.2
|
)
|
|
|
(17.5
|
)
|
|
|
(86.4
|
)
|
|
|
(90.1
|
)
|
|
|
(122.2
|
)
|
|
|
(132.0
|
)
|
NET INCOME
|
$
|
|
32.6
|
|
|
$
|
|
38.6
|
|
|
$
|
|
157.8
|
|
|
$
|
|
164.0
|
|
|
$
|
|
220.3
|
|
|
$
|
|
232.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER COMMON SHARE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
|
0.18
|
|
|
$
|
|
0.22
|
|
|
$
|
|
0.89
|
|
|
$
|
|
0.93
|
|
|
$
|
|
1.25
|
|
|
$
|
|
1.32
|
|
Diluted
|
|
0.18
|
|
|
|
0.22
|
|
|
|
0.89
|
|
|
|
0.93
|
|
|
|
1.25
|
|
|
|
1.32
|
|
Weighted-average common shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Used in basic calculation
|
|
176.2
|
|
|
|
175.8
|
|
|
|
176.3
|
|
|
|
175.8
|
|
|
|
176.2
|
|
|
|
175.7
|
|
Used in diluted calculation
|
|
176.3
|
|
|
|
176.1
|
|
|
|
176.5
|
|
|
|
176.1
|
|
|
|
176.4
|
|
|
|
176.0
|
|
Dividends per common share
|
$
|
|
0.21
|
|
|
$
|
|
0.19
|
|
|
$
|
|
0.63
|
|
|
$
|
|
0.56
|
|
|
$
|
|
0.82
|
|
|
$
|
|
0.74
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
QUESTAR CORPORATION
|
PRELIMINARY CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE
INCOME
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
3 Months Ended
|
|
|
9 Months Ended
|
|
|
12 Months Ended
|
|
|
September 30,
|
|
|
September 30,
|
|
|
September 30,
|
|
|
2015
|
|
2014
|
|
|
2015
|
|
2014
|
|
|
2015
|
|
2014
|
|
|
(in millions)
|
Net income
|
|
$
|
32.6
|
|
|
$
|
38.6
|
|
|
|
$
|
157.8
|
|
|
$
|
164.0
|
|
|
|
$
|
220.3
|
|
|
$
|
232.1
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension and other postretirement benefits
|
|
6.7
|
|
|
3.7
|
|
|
|
18.7
|
|
|
12.5
|
|
|
|
(90.7
|
)
|
|
156.6
|
|
Interest rate cash flow hedge amortization
|
|
0.1
|
|
|
0.1
|
|
|
|
0.5
|
|
|
0.4
|
|
|
|
0.6
|
|
|
0.5
|
|
Commodity cash flow hedge
|
|
0.5
|
|
|
—
|
|
|
|
0.2
|
|
|
—
|
|
|
|
0.2
|
|
|
—
|
|
Income taxes
|
|
(2.9
|
)
|
|
(1.3
|
)
|
|
|
(7.5
|
)
|
|
(4.9
|
)
|
|
|
34.3
|
|
|
(60.2
|
)
|
Net other comprehensive income (loss)
|
|
4.4
|
|
|
2.5
|
|
|
|
11.9
|
|
|
8.0
|
|
|
|
(55.6
|
)
|
|
96.9
|
|
COMPREHENSIVE INCOME
|
|
$
|
37.0
|
|
|
$
|
41.1
|
|
|
|
$
|
169.7
|
|
|
$
|
172.0
|
|
|
|
$
|
164.7
|
|
|
$
|
329.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
QUESTAR CORPORATION
|
PRELIMINARY CONDENSED CONSOLIDATED BALANCE SHEETS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
|
September 30,
|
|
|
December 31,
|
|
|
2015
|
|
|
2014
|
|
|
2014
|
|
|
(in millions)
|
ASSETS
|
|
|
|
|
|
|
|
|
Current Assets
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
—
|
|
|
|
$
|
7.3
|
|
|
|
$
|
32.0
|
|
Accounts receivable, net
|
|
62.3
|
|
|
|
57.3
|
|
|
|
118.1
|
|
Unbilled gas accounts receivable
|
|
11.2
|
|
|
|
12.8
|
|
|
|
93.7
|
|
Inventories
|
|
104.7
|
|
|
|
94.5
|
|
|
|
74.1
|
|
Current regulatory assets
|
|
89.9
|
|
|
|
84.2
|
|
|
|
79.6
|
|
Prepaid expenses and other
|
|
8.2
|
|
|
|
6.3
|
|
|
|
11.2
|
|
Deferred income taxes - current
|
|
—
|
|
|
|
14.7
|
|
|
|
5.8
|
|
Total Current Assets
|
|
276.3
|
|
|
|
277.1
|
|
|
|
414.5
|
|
Property, Plant and Equipment
|
|
6,129.9
|
|
|
|
5,852.3
|
|
|
|
5,961.5
|
|
Accumulated depreciation, depletion and amortization
|
|
(2,313.9
|
)
|
|
|
(2,185.2
|
)
|
|
|
(2,226.0
|
)
|
Net Property, Plant and Equipment
|
|
3,816.0
|
|
|
|
3,667.1
|
|
|
|
3,735.5
|
|
Investment in unconsolidated affiliate
|
|
24.5
|
|
|
|
24.9
|
|
|
|
24.7
|
|
Noncurrent regulatory and other assets
|
|
70.6
|
|
|
|
68.8
|
|
|
|
75.0
|
|
TOTAL ASSETS
|
|
$
|
4,187.4
|
|
|
|
$
|
4,037.9
|
|
|
|
$
|
4,249.7
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND COMMON SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Current Liabilities
|
|
|
|
|
|
|
|
|
Checks outstanding in excess of cash balances
|
|
$
|
2.8
|
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
Short-term debt
|
|
305.0
|
|
|
|
234.0
|
|
|
|
347.0
|
|
Accounts payable and accrued expenses
|
|
225.9
|
|
|
|
225.4
|
|
|
|
234.9
|
|
Current regulatory liabilities
|
|
3.3
|
|
|
|
11.0
|
|
|
|
13.4
|
|
Deferred income taxes - current
|
|
2.8
|
|
|
|
—
|
|
|
|
—
|
|
Current portion of long-term debt and capital lease obligation
|
|
276.8
|
|
|
|
1.0
|
|
|
|
26.1
|
|
Total Current Liabilities
|
|
816.6
|
|
|
|
471.4
|
|
|
|
621.4
|
|
Long-term debt and capital lease obligation, less current portion
|
|
1,004.4
|
|
|
|
1,283.3
|
|
|
|
1,257.5
|
|
Deferred income taxes
|
|
730.9
|
|
|
|
718.5
|
|
|
|
715.6
|
|
Noncurrent regulatory and other liabilities
|
|
342.2
|
|
|
|
285.4
|
|
|
|
409.0
|
|
COMMON SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
Common Shareholders' Equity
|
|
1,293.3
|
|
|
|
1,279.3
|
|
|
|
1,246.2
|
|
TOTAL LIABILITIES AND COMMON SHAREHOLDERS' EQUITY
|
|
$
|
4,187.4
|
|
|
|
$
|
4,037.9
|
|
|
|
$
|
4,249.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
QUESTAR CORPORATION
|
PRELIMINARY CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(Unaudited)
|
|
|
|
|
|
9 Months Ended
|
|
|
September 30,
|
|
|
2015
|
|
2014
|
|
|
(in millions)
|
OPERATING ACTIVITIES
|
|
|
|
|
Net income
|
|
$
|
157.8
|
|
|
$
|
164.0
|
|
Adjustments to reconcile net income to net cash provided by
operating activities:
|
|
|
|
|
Depreciation, depletion and amortization
|
|
168.3
|
|
|
169.1
|
|
Deferred income taxes
|
|
16.5
|
|
|
1.4
|
|
Abandonment and impairment
|
|
0.1
|
|
|
2.0
|
|
Share-based compensation
|
|
8.7
|
|
|
8.5
|
|
Net (gain) from asset sales
|
|
(1.6
|
)
|
|
(1.6
|
)
|
(Income) from unconsolidated affiliate
|
|
(2.8
|
)
|
|
(2.7
|
)
|
Distributions from unconsolidated affiliate and other
|
|
3.9
|
|
|
4.1
|
|
Changes in operating assets and liabilities
|
|
13.1
|
|
|
17.7
|
|
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
|
364.0
|
|
|
362.5
|
|
|
|
|
|
|
INVESTING ACTIVITIES
|
|
|
|
|
Property, plant and equipment
|
|
(213.7
|
)
|
|
(235.3
|
)
|
Questar Gas acquisition of gas distribution system
|
|
(11.4
|
)
|
|
—
|
|
Cash used in disposition of assets
|
|
(2.8
|
)
|
|
(2.6
|
)
|
Proceeds from disposition of assets
|
|
2.0
|
|
|
9.4
|
|
NET CASH USED IN INVESTING ACTIVITIES
|
|
(225.9
|
)
|
|
(228.5
|
)
|
|
|
|
|
|
FINANCING ACTIVITIES
|
|
|
|
|
Common stock
|
|
(18.9
|
)
|
|
(2.8
|
)
|
Change in short-term debt
|
|
(42.0
|
)
|
|
(42.0
|
)
|
Checks outstanding in excess of cash balances
|
|
2.8
|
|
|
—
|
|
Capital lease obligation repaid
|
|
(1.0
|
)
|
|
(0.7
|
)
|
Dividends paid
|
|
(111.2
|
)
|
|
(98.5
|
)
|
Tax benefits from share-based compensation
|
|
0.2
|
|
|
1.3
|
|
NET CASH USED IN FINANCING ACTIVITIES
|
|
(170.1
|
)
|
|
(142.7
|
)
|
Change in cash and cash equivalents
|
|
(32.0
|
)
|
|
(8.7
|
)
|
Beginning cash and cash equivalents
|
|
32.0
|
|
|
16.0
|
|
Ending cash and cash equivalents
|
|
$
|
—
|
|
|
$
|
7.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
QUESTAR CORPORATION
|
OPERATIONS BY LINE OF BUSINESS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3 Months Ended
|
|
|
|
9 Months Ended
|
|
|
|
12 Months Ended
|
|
|
|
September 30,
|
|
|
|
September 30,
|
|
|
|
September 30,
|
|
|
|
2015
|
|
|
2014
|
|
|
|
2015
|
|
|
2014
|
|
|
|
2015
|
|
|
2014
|
|
|
|
(in millions)
|
Revenues from Unaffiliated Customers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Questar Gas
|
|
$
|
|
89.3
|
|
|
$
|
|
100.7
|
|
|
|
$
|
|
605.8
|
|
|
$
|
|
642.0
|
|
|
|
$
|
|
924.7
|
|
|
$
|
|
979.4
|
|
Wexpro
|
|
|
6.4
|
|
|
|
9.4
|
|
|
|
|
22.8
|
|
|
|
29.5
|
|
|
|
|
28.9
|
|
|
|
42.6
|
|
Questar Pipeline
|
|
|
45.0
|
|
|
|
47.3
|
|
|
|
|
138.3
|
|
|
|
143.4
|
|
|
|
|
185.1
|
|
|
|
190.6
|
|
Other
|
|
|
1.6
|
|
|
|
0.5
|
|
|
|
|
3.3
|
|
|
|
1.2
|
|
|
|
|
4.7
|
|
|
|
1.4
|
|
Total
|
|
$
|
|
142.3
|
|
|
$
|
|
157.9
|
|
|
|
$
|
|
770.2
|
|
|
$
|
|
816.1
|
|
|
|
$
|
|
1,143.4
|
|
|
$
|
|
1,214.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues from Affiliated Companies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wexpro
|
|
$
|
80.7
|
|
|
$
|
82.3
|
|
|
|
$
|
241.1
|
|
|
$
|
266.3
|
|
|
|
$
|
325.1
|
|
|
$
|
345.9
|
|
Questar Pipeline
|
|
|
17.6
|
|
|
|
17.7
|
|
|
|
|
54.8
|
|
|
|
54.7
|
|
|
|
|
73.8
|
|
|
|
76.6
|
|
Total
|
|
$
|
|
98.3
|
|
|
$
|
|
100.0
|
|
|
|
$
|
|
295.9
|
|
|
$
|
|
321.0
|
|
|
|
$
|
|
398.9
|
|
|
$
|
|
422.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Questar Gas
|
|
$
|
|
(8.9
|
)
|
|
$
|
|
(9.4
|
)
|
|
|
$
|
|
69.1
|
|
|
$
|
|
60.7
|
|
|
|
$
|
|
117.9
|
|
|
$
|
|
107.3
|
|
Wexpro
|
|
|
40.7
|
|
|
|
47.2
|
|
|
|
|
124.2
|
|
|
|
141.5
|
|
|
|
|
166.0
|
|
|
|
187.3
|
|
Questar Pipeline
|
|
|
28.8
|
|
|
|
28.8
|
|
|
|
|
85.5
|
|
|
|
89.3
|
|
|
|
|
113.8
|
|
|
|
119.1
|
|
Corporate and other
|
|
|
1.7
|
|
|
|
2.3
|
|
|
|
|
5.8
|
|
|
|
2.2
|
|
|
|
|
(1.4
|
)
|
|
|
2.6
|
|
Total
|
|
$
|
|
62.3
|
|
|
$
|
|
68.9
|
|
|
|
$
|
|
284.6
|
|
|
$
|
|
293.7
|
|
|
|
$
|
|
396.3
|
|
|
$
|
|
416.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Questar Gas
|
|
$
|
|
(8.8
|
)
|
|
$
|
|
(9.1
|
)
|
|
|
$
|
|
32.2
|
|
|
$
|
|
27.2
|
|
|
|
$
|
|
60.2
|
|
|
$
|
|
53.2
|
|
Wexpro
|
|
|
26.9
|
|
|
|
31.1
|
|
|
|
|
82.5
|
|
|
|
93.0
|
|
|
|
|
112.3
|
|
|
|
121.4
|
|
Questar Pipeline
|
|
|
15.2
|
|
|
|
14.9
|
|
|
|
|
44.3
|
|
|
|
46.3
|
|
|
|
|
58.6
|
|
|
|
62.1
|
|
Corporate and other
|
|
|
(0.7
|
)
|
|
|
1.7
|
|
|
|
|
(1.2
|
)
|
|
|
(2.5
|
)
|
|
|
|
(10.8
|
)
|
|
|
(4.6
|
)
|
Total
|
|
$
|
|
32.6
|
|
|
$
|
|
38.6
|
|
|
|
$
|
|
157.8
|
|
|
$
|
|
164.0
|
|
|
|
$
|
|
220.3
|
|
|
$
|
|
232.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
QUESTAR CORPORATION
|
SELECTED OPERATING STATISTICS
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
3 Months Ended
|
|
|
9 Months Ended
|
|
|
12 Months Ended
|
|
|
September 30,
|
|
|
September 30,
|
|
|
September 30,
|
|
|
2015
|
|
2014
|
|
|
2015
|
|
2014
|
|
|
2015
|
|
2014
|
QUESTAR GAS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas volumes (MMdth)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential and commercial sales
|
|
7.4
|
|
|
7.4
|
|
|
|
58.4
|
|
|
65.8
|
|
|
|
90.6
|
|
|
105.3
|
|
Industrial sales
|
|
0.8
|
|
|
1.0
|
|
|
|
2.6
|
|
|
3.1
|
|
|
|
3.8
|
|
|
4.3
|
|
Transportation for industrial customers
|
|
20.4
|
|
|
21.9
|
|
|
|
56.8
|
|
|
60.5
|
|
|
|
77.6
|
|
|
79.1
|
|
Total industrial
|
|
21.2
|
|
|
22.9
|
|
|
|
59.4
|
|
|
63.6
|
|
|
|
81.4
|
|
|
83.4
|
|
Total deliveries
|
|
28.6
|
|
|
30.3
|
|
|
|
117.8
|
|
|
129.4
|
|
|
|
172.0
|
|
|
188.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas revenue (per dth)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential and commercial sales
|
|
$
|
9.87
|
|
|
$
|
10.70
|
|
|
|
$
|
9.49
|
|
|
$
|
8.82
|
|
|
|
$
|
9.38
|
|
|
$
|
8.52
|
|
Industrial sales
|
|
6.13
|
|
|
6.59
|
|
|
|
6.66
|
|
|
6.51
|
|
|
|
7.34
|
|
|
6.65
|
|
Transportation for industrial customers
|
|
0.27
|
|
|
0.21
|
|
|
|
0.27
|
|
|
0.22
|
|
|
|
0.26
|
|
|
0.22
|
|
Warmer than normal temperatures
|
|
(60
|
%)
|
|
(60
|
%)
|
|
|
(23
|
%)
|
|
(17
|
%)
|
|
|
(21
|
%)
|
|
(9
|
%)
|
Temperature-adjusted usage per customer (dth)
|
|
7.2
|
|
|
7.1
|
|
|
|
67.2
|
|
|
74.3
|
|
|
|
101.8
|
|
|
111.3
|
|
Customers at Sept. 30, (thousands)
|
|
981
|
|
|
955
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WEXPRO
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production volumes
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas - cost-of-service deliveries (Bcf)
|
|
14.6
|
|
|
15.4
|
|
|
|
43.9
|
|
|
51.6
|
|
|
|
55.8
|
|
|
67.3
|
|
Natural gas - sales (Bcf)
|
|
1.2
|
|
|
0.1
|
|
|
|
3.6
|
|
|
0.6
|
|
|
|
3.8
|
|
|
1.6
|
|
Oil and NGL (Mbbl)
|
|
118
|
|
|
145
|
|
|
|
351
|
|
|
454
|
|
|
|
484
|
|
|
613
|
|
Natural gas average sales price (per Mcf)
|
|
$
|
2.90
|
|
|
$
|
4.54
|
|
|
|
$
|
2.87
|
|
|
$
|
4.49
|
|
|
|
$
|
2.99
|
|
|
$
|
4.04
|
|
Oil and NGL average sales price (per bbl)
|
|
$
|
35.43
|
|
|
$
|
85.03
|
|
|
|
$
|
39.14
|
|
|
$
|
86.27
|
|
|
|
$
|
43.91
|
|
|
$
|
85.23
|
|
Investment base at Sept. 30, (in millions)
|
|
$
|
616.5
|
|
|
$
|
664.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
QUESTAR PIPELINE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas transportation volumes (MMdth)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For unaffiliated customers
|
|
185.3
|
|
|
186.1
|
|
|
|
541.1
|
|
|
543.9
|
|
|
|
718.6
|
|
|
732.0
|
|
For Questar Gas
|
|
19.9
|
|
|
21.1
|
|
|
|
75.0
|
|
|
85.1
|
|
|
|
106.1
|
|
|
122.9
|
|
Total transportation
|
|
205.2
|
|
|
207.2
|
|
|
|
616.1
|
|
|
629.0
|
|
|
|
824.7
|
|
|
854.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transportation revenue (per dth)
|
|
$
|
0.23
|
|
|
$
|
0.23
|
|
|
|
$
|
0.24
|
|
|
$
|
0.23
|
|
|
|
$
|
0.24
|
|
|
$
|
0.23
|
|
Net firm-daily transportation demand at Sept. 30, (Mdth)
|
|
5,107
|
|
|
5,058
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas processing
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NGL sales (Mbbl)
|
|
31
|
|
|
31
|
|
|
|
92
|
|
|
100
|
|
|
|
120
|
|
|
136
|
|
NGL average sales price (per bbl)
|
|
$
|
19.91
|
|
|
$
|
56.03
|
|
|
|
$
|
21.53
|
|
|
$
|
58.70
|
|
|
|
$
|
25.37
|
|
|
$
|
59.10
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
QUESTAR CORPORATION
NON-GAAP FINANCIAL MEASURES
(Unaudited)
In addition to financial measures calculated in accordance with
generally accepted accounting principles (GAAP), this press release
contains non-GAAP financial measures. The Company believes that these
non-GAAP financial measures are useful to investors because they provide
alternative methods for assessing the Company's ongoing operating
results. The Company's management uses these non-GAAP financial measures
for the same purposes, and for planning and forecasting purposes. The
presentation of non-GAAP financial measures is not meant to be a
substitute for financial measures calculated in accordance with GAAP.
Management defines Adjusted EBITDA as net income (loss) before the
following items: interest expense, income taxes, depreciation, depletion
and amortization, net gain or loss from asset sales, abandonments and
impairments, and other special items. Management believes Adjusted
EBITDA is an important measure of the Company's financial performance
and a key measure for comparing results to other companies.
The following table reconciles Questar's net income (loss) to Adjusted
EBITDA for the three months ended September 30, 2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
Questar Consolidated
|
|
Questar Gas
|
|
Wexpro
|
|
Questar Pipeline
|
|
Corporate, Other
|
|
|
(in millions)
|
Net income (loss)
|
|
$
|
32.6
|
|
|
$
|
(8.8
|
)
|
|
$
|
26.9
|
|
|
$
|
15.2
|
|
|
$
|
(0.7
|
)
|
Interest expense
|
|
15.7
|
|
|
7.0
|
|
|
—
|
|
|
6.6
|
|
|
2.1
|
|
Income taxes
|
|
16.2
|
|
|
(5.8
|
)
|
|
13.9
|
|
|
8.0
|
|
|
0.1
|
|
Depreciation, depletion and amortization
|
|
55.0
|
|
|
13.8
|
|
|
26.2
|
|
|
13.3
|
|
|
1.7
|
|
Net (gain) from asset sales
|
|
(0.2
|
)
|
|
—
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|
—
|
|
Adjusted EBITDA
|
|
$
|
119.3
|
|
|
$
|
6.2
|
|
|
$
|
66.9
|
|
|
$
|
43.0
|
|
|
$
|
3.2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following table reconciles Questar's net income (loss) to Adjusted
EBITDA for the three months ended September 30, 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
Questar Consolidated
|
|
Questar Gas
|
|
Wexpro
|
|
Questar Pipeline
|
|
Corporate, Other
|
|
|
(in millions)
|
Net income (loss)
|
|
$
|
38.6
|
|
|
$
|
(9.1
|
)
|
|
$
|
31.1
|
|
|
$
|
14.9
|
|
|
$
|
1.7
|
|
Interest expense
|
|
15.7
|
|
|
7.1
|
|
|
—
|
|
|
6.5
|
|
|
2.1
|
|
Income taxes
|
|
17.5
|
|
|
(5.7
|
)
|
|
16.4
|
|
|
8.6
|
|
|
(1.8
|
)
|
Depreciation, depletion and amortization
|
|
50.8
|
|
|
13.5
|
|
|
22.4
|
|
|
13.5
|
|
|
1.4
|
|
Net (gain) from asset sales
|
|
(1.5
|
)
|
|
—
|
|
|
(1.5
|
)
|
|
—
|
|
|
—
|
|
Adjusted EBITDA
|
|
$
|
121.1
|
|
|
$
|
5.8
|
|
|
$
|
68.4
|
|
|
$
|
43.5
|
|
|
$
|
3.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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