UIL Reports Third Quarter 2015 Earnings and Affirms 2015 Earnings Guidance
Today, UIL Holdings Corporation (NYSE: UIL) reported consolidated net
income of $15.6 million, or $0.27 per diluted share, in the third
quarter 2015, compared to $12.5 million, or $0.22 per diluted share, in
the third quarter 2014. For the first nine months of 2015, consolidated
net income was $89.1 million, or $1.55 per diluted share, compared to
$77.3 million, or $1.35 per diluted share, for the same period in 2014.
Consolidated earnings for the third quarter and first nine months 2015
and 2014 include certain non-recurring items, which are explained below.
-
Merger-related expenses associated with the pending merger of UIL and
Iberdrola USA, Inc. recorded in the third quarter and first nine
months of 2015
-
Acquisition-related expenses associated with the now-terminated
proposed acquisition of Philadelphia Gas Works recorded in the third
quarter and first nine months of 2014
-
Transmission return on equity (ROE) reserves related to ROE
proceedings pending at the Federal Energy Regulatory Commission (FERC)
recorded in the third quarter and first nine months of 2015 and 2014
Consolidated earnings, excluding the non-recurring items, for the third
quarter and nine months ended September 30 were:
|
|
Quarter ended September 30,
|
|
|
Net Income (Loss) - $M
|
|
Earnings (Loss) per Share - Diluted
|
|
|
2015
|
|
2014
|
|
'15 vs '14
|
|
2015
|
|
2014
|
|
'15 vs '14
|
Consolidated Earnings
|
|
$
|
15.6
|
|
$
|
12.5
|
|
$
|
3.1
|
|
|
$
|
0.27
|
|
$
|
0.22
|
|
$
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-recurring items:
|
|
|
|
|
|
|
|
|
|
|
|
|
Merger/Acquisition-related expenses
|
|
|
0.4
|
|
|
0.9
|
|
|
(0.5
|
)
|
|
|
0.01
|
|
|
0.01
|
|
|
-
|
|
Transmission ROE reserves
|
|
|
0.1
|
|
|
3.2
|
|
|
(3.1
|
)
|
|
|
-
|
|
|
0.06
|
|
|
(0.06
|
)
|
Consolidated Earnings, excl. non-recurring items
|
|
$
|
16.1
|
|
$
|
16.6
|
|
$
|
(0.5
|
)
|
|
$
|
0.28
|
|
$
|
0.29
|
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year-to-date September 30,
|
|
|
Net Income (Loss) - $M
|
|
Earnings (Loss) per Share - Diluted
|
|
|
2015
|
|
2014
|
|
'15 vs '14
|
|
2015
|
|
2014
|
|
'15 vs '14
|
Consolidated Earnings
|
|
$
|
89.1
|
|
$
|
77.3
|
|
$
|
11.8
|
|
|
$
|
1.55
|
|
$
|
1.35
|
|
$
|
0.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-recurring items:
|
|
|
|
|
|
|
|
|
|
|
|
|
Merger/Acquisition-related expenses
|
|
|
4.4
|
|
|
12.8
|
|
|
(8.4
|
)
|
|
|
0.08
|
|
|
0.22
|
|
|
(0.14
|
)
|
Transmission ROE reserves
|
|
|
2.3
|
|
|
3.2
|
|
|
(0.9
|
)
|
|
|
0.04
|
|
|
0.06
|
|
|
(0.02
|
)
|
Consolidated Earnings, excl. non-recurring items
|
|
$
|
95.8
|
|
$
|
93.3
|
|
$
|
2.5
|
|
|
$
|
1.67
|
|
$
|
1.63
|
|
$
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
“Earnings for the third quarter 2015, excluding non-recurring items,
were relatively flat,” commented James P. Torgerson, UIL’s president and
chief executive officer. “The increase in year-to-date earnings,
excluding non-recurring items, is attributable to a combination of usage
from new natural gas heating customers and colder winter weather. We
have added almost 6,800 gas heating customers through September 2015 and
remain on target to reach our 2015 goal of 12,000 conversions.”
Proposed Merger with Iberdrola USA, Inc.
In September, UIL, Iberdrola USA, Inc. (and their related parties) and
the CT Office of Consumer Counsel filed a settlement agreement with the
CT Public Utilities Regulatory Authority (PURA) in its change in control
proceeding. And in October, UIL, Iberdrola USA, Inc. (and their related
parties), the Attorney General of MA and the MA Department of Energy
Resources filed a settlement agreement with the MA Department of Public
Utilities in its change in control proceeding.
“Hearings in CT are complete and the final decision from CT PURA is
currently scheduled for December 9th,” added Torgerson. “Our
filing in MA requested MA DPU approval by December 18th. We
continue to expect the transaction to close by year-end 2015, following
shareowner approval and receipt of all regulatory approvals.”
Electric Distribution
The electric distribution business earned $18.1 million, or $0.31 per
diluted share, in the third quarter 2015, compared to $17.9 million, or
$0.31 per diluted share, in the third quarter 2014. For the first nine
months of 2015, the electric distribution business earned $39.9 million,
or $0.70 per diluted share, compared to $43.1 million, or $0.75 per
diluted share, for the same period in 2014. The decrease in earnings for
the first nine months was primarily due to higher employee-related
expenses, depreciation and amortization expenses as well as adjustments
associated with the completion of the Internal Revenue Service’s
examination of income tax years 2009-2012.
Electric Transmission
The electric transmission business earned $8.4 million, or $0.15 per
diluted share, in the third quarter 2015, compared to $5.5 million, or
$0.10 per diluted share, in the third quarter 2014. For the first nine
months of 2015, the electric transmission business earned $22.7 million,
or $0.39 per diluted share, compared to $23.1 million, or $0.40 per
diluted share, for the same period in 2014.
Electric transmission earnings, excluding the non-recurring transmission
ROE reserves discussed above, for the third quarter and nine months
ended September 30 were:
|
|
Quarter ended September 30,
|
|
|
Net Income (Loss) - $M
|
|
Earnings (Loss) per Share - Diluted
|
|
|
2015
|
|
2014
|
|
'15 vs '14
|
|
2015
|
|
2014
|
|
'15 vs '14
|
Electric Transmission
|
|
$
|
8.4
|
|
$
|
5.5
|
|
$
|
2.9
|
|
|
$
|
0.15
|
|
$
|
0.10
|
|
$
|
0.05
|
|
Transmission ROE reserves
|
|
|
0.1
|
|
|
3.2
|
|
|
(3.1
|
)
|
|
|
-
|
|
|
0.06
|
|
|
(0.06
|
)
|
Electric Transmission, excl. non-recurring item
|
|
$
|
8.5
|
|
$
|
8.7
|
|
$
|
(0.2
|
)
|
|
$
|
0.15
|
|
$
|
0.16
|
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year-to-Date September 30,
|
|
|
Net Income (Loss) - $M
|
|
Earnings (Loss) per Share - Diluted
|
|
|
2015
|
|
2014
|
|
'15 vs '14
|
|
2015
|
|
2014
|
|
'15 vs '14
|
Electric Transmission
|
|
$
|
22.7
|
|
$
|
23.1
|
|
$
|
(0.4
|
)
|
|
$
|
0.39
|
|
$
|
0.40
|
|
$
|
(0.01
|
)
|
Transmission ROE reserves
|
|
|
2.3
|
|
|
3.2
|
|
|
(0.9
|
)
|
|
|
0.04
|
|
|
0.06
|
|
|
(0.02
|
)
|
Electric Transmission, excl. non-recurring item
|
|
$
|
25.0
|
|
$
|
26.3
|
|
$
|
(1.3
|
)
|
|
$
|
0.43
|
|
$
|
0.46
|
|
$
|
(0.03
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The decrease in earnings for both the third quarter and first nine
months of 2015 was primarily due to a lower ROE as a result of the
transmission ROE proceedings pending at the FERC.
Gas Distribution
The gas distribution businesses incurred a loss, consistent with the
seasonal nature of the gas business, of $7.4 million, or $0.13 per
diluted share, in the third quarter 2015, compared to a loss of $6.5
million, or $0.11 per diluted share, in the third quarter 2014. The
increased loss was primarily due to increased uncollectible expense and
employee-related expenses, partially offset by usage from new gas
heating customers.
For the first nine months of 2015, the gas distribution businesses
earned $35.2 million, or $0.61 per diluted share, compared to $30.3
million, or $0.53 per diluted share, in the same period in 2014. The
increase in earnings was primarily due to colder weather, usage from new
gas heating customers and lower uncollectible expense (even though
uncollectible expense was higher for the quarter), partially offset by
higher employee-related expenses.
The gross margin impacts from weather, normalized usage per customer and
customer growth are presented in the table below:
Estimated Impact of Weather, NUPC and Customer Growth
|
(In Thousands)
|
|
3Q '15 vs. 3Q '14
|
|
YTD '15 vs. YTD '14
|
|
Gross Margin
|
|
Gross Margin
|
|
favorable/(unfavorable)
|
|
favorable/(unfavorable)
|
Weather(1)
|
$
|
35
|
|
|
$
|
6,185
|
|
Normalized usage per customer
|
|
(760
|
)
|
|
|
(2,599
|
)
|
Decoupling adjustment
|
|
733
|
|
|
|
(1,471
|
)
|
Subtotal
|
$
|
8
|
|
|
$
|
2,115
|
|
Customer Growth
|
|
2,614
|
|
|
|
6,254
|
|
Total
|
$
|
2,622
|
|
|
$
|
8,369
|
|
(1) Excluding weather insurance
|
|
|
Corporate
Corporate costs were $3.5 million, after-tax, or $0.06 per diluted
share, in the third quarter 2015, compared to costs of $4.4 million,
after-tax, or $0.08 per diluted share, in the third quarter 2014. For
the first nine months of 2015, Corporate costs were $8.7 million,
after-tax, or $0.15 per diluted share, compared to costs of $19.2
million, or $0.33 per diluted share, for the same period in 2014.
Corporate costs, excluding the non-recurring merger/acquisition-related
expenses discussed above, for the third quarter and nine months ended
September 30 were:
|
|
Quarter ended September 30,
|
|
|
Net Income (Loss) - $M
|
|
Earnings (Loss) per Share - Diluted
|
|
|
2015
|
|
2014
|
|
'15 vs '14
|
|
2015
|
|
2014
|
|
'15 vs '14
|
Corporate
|
|
$
|
(3.5
|
)
|
|
$
|
(4.4
|
)
|
|
$
|
0.9
|
|
|
$
|
(0.06
|
)
|
|
$
|
(0.08
|
)
|
|
$
|
0.02
|
|
Merger/Acquisition-related expenses
|
|
|
0.4
|
|
|
|
0.9
|
|
|
|
(0.5
|
)
|
|
|
0.01
|
|
|
|
0.01
|
|
|
|
-
|
|
Corporate, excl. non-recurring item
|
|
$
|
(3.1
|
)
|
|
$
|
(3.5
|
)
|
|
$
|
0.4
|
|
|
$
|
(0.05
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year-to-Date September 30,
|
|
|
Net Income (Loss) - $M
|
|
Earnings (Loss) per Share - Diluted
|
|
|
2015
|
|
2014
|
|
'15 vs '14
|
|
2015
|
|
2014
|
|
'15 vs '14
|
Corporate
|
|
$
|
(8.7
|
)
|
|
$
|
(19.2
|
)
|
|
$
|
10.5
|
|
|
$
|
(0.15
|
)
|
|
$
|
(0.33
|
)
|
|
$
|
0.18
|
|
Merger/Acquisition-related expenses
|
|
|
4.4
|
|
|
|
12.8
|
|
|
|
(8.4
|
)
|
|
|
0.08
|
|
|
|
0.22
|
|
|
|
(0.14
|
)
|
Corporate, excl. non-recurring item
|
|
$
|
(4.3
|
)
|
|
$
|
(6.4
|
)
|
|
$
|
2.1
|
|
|
$
|
(0.07
|
)
|
|
$
|
(0.11
|
)
|
|
$
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The decrease in Corporate costs for the third quarter and first nine
months of 2015 was primarily due to increased returns on shared capital
assets.
Segment details for UIL’s results for the third quarter and first nine
months of 2015, compared to the same periods in 2014, are presented in
the table below:
|
|
|
Net Income (Loss) - $M
|
|
|
|
Quarter ended September 30,
|
|
Year-to-date September 30,
|
|
|
|
2015
|
|
2014
|
|
'15 vs '14
|
|
2015
|
|
2014
|
|
'15 vs '14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Electric Distribution
|
|
|
$
|
18.1
|
|
|
$
|
17.9
|
|
|
$
|
0.2
|
|
|
$
|
39.9
|
|
|
$
|
43.1
|
|
|
$
|
(3.2
|
)
|
Electric Transmission
|
|
|
|
8.5
|
|
|
|
8.7
|
|
|
|
(0.2
|
)
|
|
|
25.0
|
|
|
|
26.3
|
|
|
|
(1.3
|
)
|
Gas Distribution
|
|
|
|
(7.4
|
)
|
|
|
(6.5
|
)
|
|
|
(0.9
|
)
|
|
|
35.2
|
|
|
|
30.3
|
|
|
|
4.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Companies
|
|
|
|
19.2
|
|
|
|
20.1
|
|
|
|
(0.9
|
)
|
|
|
100.1
|
|
|
|
99.7
|
|
|
|
0.4
|
|
Corporate
|
|
|
|
(3.1
|
)
|
|
|
(3.5
|
)
|
|
|
0.4
|
|
|
|
(4.3
|
)
|
|
|
(6.4
|
)
|
|
|
2.1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal
|
|
|
$
|
16.1
|
|
|
$
|
16.6
|
|
|
$
|
(0.5
|
)
|
|
$
|
95.8
|
|
|
$
|
93.3
|
|
|
$
|
2.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Merger and acquisition-related expenses
|
|
|
|
(0.4
|
)
|
|
|
(0.9
|
)
|
|
|
0.5
|
|
|
|
(4.4
|
)
|
|
|
(12.8
|
)
|
|
|
8.4
|
|
Transmission ROE reserves
|
|
|
|
(0.1
|
)
|
|
|
(3.2
|
)
|
|
|
3.1
|
|
|
|
(2.3
|
)
|
|
|
(3.2
|
)
|
|
|
0.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Earnings
|
|
|
$
|
15.6
|
|
|
$
|
12.5
|
|
|
$
|
3.1
|
|
|
$
|
89.1
|
|
|
$
|
77.3
|
|
|
$
|
11.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (Loss) Per Share
|
|
|
|
Quarter ended September 30,
|
|
Year-to-date September 30,
|
|
|
|
2015
|
|
2014
|
|
'15 vs '14
|
|
2015
|
|
2014
|
|
'15 vs '14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Electric Distribution
|
|
|
$
|
0.31
|
|
|
$
|
0.31
|
|
|
$
|
-
|
|
|
$
|
0.70
|
|
|
$
|
0.75
|
|
|
$
|
(0.05
|
)
|
Electric Transmission
|
|
|
|
0.15
|
|
|
|
0.16
|
|
|
|
(0.01
|
)
|
|
|
0.43
|
|
|
|
0.46
|
|
|
|
(0.03
|
)
|
Gas Distribution
|
|
|
|
(0.13
|
)
|
|
|
(0.11
|
)
|
|
|
(0.02
|
)
|
|
|
0.61
|
|
|
|
0.53
|
|
|
|
0.08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Companies
|
|
|
|
0.33
|
|
|
|
0.36
|
|
|
|
(0.03
|
)
|
|
|
1.74
|
|
|
|
1.74
|
|
|
|
-
|
|
Corporate
|
|
|
|
(0.05
|
)
|
|
|
(0.07
|
)
|
|
|
0.02
|
|
|
|
(0.07
|
)
|
|
|
(0.11
|
)
|
|
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subtotal
|
|
|
$
|
0.28
|
|
|
$
|
0.29
|
|
|
$
|
(0.01
|
)
|
|
$
|
1.67
|
|
|
$
|
1.63
|
|
|
$
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Merger and acquisition-related expenses
|
|
|
|
(0.01
|
)
|
|
|
(0.01
|
)
|
|
|
-
|
|
|
|
(0.08
|
)
|
|
|
(0.22
|
)
|
|
|
0.14
|
|
Transmission ROE reserves
|
|
|
|
-
|
|
|
|
(0.06
|
)
|
|
|
0.06
|
|
|
|
(0.04
|
)
|
|
|
(0.06
|
)
|
|
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Earnings
|
|
|
$
|
0.27
|
|
|
$
|
0.22
|
|
|
$
|
0.05
|
|
|
$
|
1.55
|
|
|
$
|
1.35
|
|
|
$
|
0.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Avg. Shares - diluted (M)
|
|
|
|
57.4
|
|
|
|
57.1
|
|
|
|
|
|
57.4
|
|
|
|
57.1
|
|
|
|
Amounts may not add due to rounding
|
Note: Certain EPS amounts related to the 3Q '14 have been updated
to correct for rounding & to conform to the current presentation
|
|
Looking Forward
UIL affirms its consolidated earnings for 2015 in the range of $126-$134
million, or $2.19-$2.34 per diluted share. In addition, UIL affirms its
2015 consolidated earnings, excluding the non-recurring items, of
$132-$140 million, or $2.30-2.45 per diluted share. Forecasted earnings
for 2015 are summarized in the table below.
Category
|
|
Approximate Net Income(1)
|
|
EPS - diluted(2)
|
|
|
|
|
|
Electric Distribution
|
|
$46 - $54
|
|
$0.80 - $0.95
|
Electric Transmission(3)
|
|
$33 - $38
|
|
$0.57 - $0.67
|
|
|
|
|
|
Total Electric
|
|
$80 - $92
|
|
$1.40 - $1.60
|
|
|
|
|
|
Gas Distribution
|
|
$54 - $58
|
|
$0.95 - $1.02
|
|
|
|
|
|
Operating Companies
|
|
$135- $144
|
|
$2.35 - $2.52
|
|
|
|
|
|
UIL Corporate
|
|
($7) - ($5)
|
|
($0.13) - ($0.08)
|
|
|
|
|
|
Total UIL Holdings, excl. non-recurring items
|
|
$132 - $140
|
|
$2.30 - $2.45
|
|
|
|
|
|
Non-recurring item - Merger-related expenses(4)
|
|
($4) - ($4)
|
|
($0.08) - ($0.08)
|
|
|
|
|
|
Non-recurring item - Regulatory reserves
|
|
($2) - ($2)
|
|
($0.04) - ($0.04)
|
|
|
|
|
|
Total UIL Holdings(5)
|
|
$126 - $134
|
|
$2.19 - $2.34
|
|
|
|
|
|
(1)
|
|
Rounded to the nearest million
|
(2)
|
|
Assumes approximately 57.4 million average shares outstanding
|
(3)
|
|
Excludes any adjustments that may result from the FERC ROE
complaints
|
(4)
|
|
Merger-related expenses through September 30, 2015; future
merger-related expenses and projected impacts of compliance with
regulatory settlements/orders excluded
|
(5)
|
|
Expectations are not expected to be additive
|
|
|
|
Third quarter 2015 earnings conference call
UIL will conduct a webcast conference call with financial analysts on
Tuesday, November 3, 2015, beginning at 1:00 p.m. eastern time. UIL’s
executive management will present an overview of the financial results
followed by a question and answer session. Interested parties, including
analysts, investors and the media, may listen live via the internet by
logging onto the Investors section of UIL’s website at http://www.uil.com.
Institutional investors can access the call via Thomson Street Events (www.streetevents.com),
a password-protected event management site.
Headquartered in New Haven, Connecticut, UIL Holdings Corporation (NYSE:UIL)
is a diversified energy delivery company serving a total of
approximately 727,000 electric and natural gas utility customers in 67
communities across two states, with combined total assets of over $5
billion.
UIL Holdings is the parent company for The United Illuminating Company
(UI), Connecticut Natural Gas Corporation (CNG), The Southern
Connecticut Gas Company (SCG), and The Berkshire Gas Company
(Berkshire), each more than 100 years old. UI provides for the
transmission and delivery of electricity and other energy related
services for Connecticut’s Greater New Haven and Bridgeport areas. SCG
and CNG are natural gas distribution companies that serve customers in
Connecticut, while Berkshire serves natural gas customers in western
Massachusetts. UIL Holdings employs approximately 1,900 people in the
New England region. For more information on UIL Holdings, visit http://www.uil.com.
Use of Non-GAAP Measures
UIL Holdings believes that a breakdown presented on a net income and
per share basis by line of business is useful in understanding the
change in the results of operations of UIL Holdings’ lines of business
from one reporting period to another and in evaluating the actual and
projected financial performance and contribution of UIL Holdings’ lines
of businesses. Earnings per share (EPS) by business is a non-GAAP (not
determined using generally accepted accounting principles) measure that
is calculated by taking the pre-tax amounts determined in accordance
with GAAP of each line of business, and applying the effective statutory
federal and state tax rate and then dividing the results by the average
number of diluted shares of UIL Holdings’ common stock outstanding for
the periods presented. Any such amounts provided are provided for
informational purposes only and are not intended to be used to calculate
"Pro-forma" amounts.
UIL Holdings also believe presenting earnings excluding certain
non-recurring items, including as presented in the net income discussion
and in the earnings guidance section, is useful in understanding and
evaluating actual and projected financial performance and contribution
of UIL Holdings and to more fully compare and explain our results
without including the impact of the non-recurring items. Non-GAAP
financial measures should not be considered as alternatives to UIL
Holdings’ consolidated net income or EPS determined in accordance with
GAAP as indicators of UIL Holdings’ operating performance.
Forward-Looking Statements
Certain statements contained in this presentation regarding matters
that are not historical facts, are forward-looking statements (as
defined in the Private Securities Litigation Reform Act of 1995). These
include statements regarding management’s intentions, plans, beliefs,
expectations or forecasts for the future. Such forward-looking
statements are based on our expectations and involve risks and
uncertainties; consequently, actual results may differ materially from
those expressed or implied in the statements. In addition, risks
and uncertainties related to our proposed merger with Iberdrola USA
include, but are not limited to, the expected timing and likelihood of
completion of the pending merger, including the timing, receipt and
terms and conditions of any required governmental and regulatory
approvals of the pending merger that could reduce anticipated benefits
or cause the parties to abandon the transaction, the ability to
successfully integrate the businesses, the occurrence of any event,
change or other circumstances that could give rise to the termination of
the merger agreement, the possibility that our shareowners may not
approve the merger agreement, the risk that the parties may not be able
to satisfy the conditions to the proposed merger in a timely manner or
at all, risks related to disruption of management time from ongoing
business operations due to the proposed merger, the risk that any
announcements relating to the proposed merger could have adverse effects
on the market price of UIL Holdings’ common stock, and the risk that the
proposed transaction and its announcement could have an adverse effect
on our ability to retain and hire key personnel and maintain
relationships with our suppliers, and on our operating results and
businesses generally.
New factors emerge from time to time and it is not possible for us to
predict all such factors, nor can we assess the impact of each such
factor on the business or the extent to which any factor, or combination
of factors, may cause actual results to differ materially from those
contained in any forward-looking statements. These risks, as well
as other risks associated with the merger, are more fully discussed in
UIL Holdings’ preliminary proxy statement/prospectus included in
Iberdrola USA’s Registration Statement on Form S-4, as amended,
which was filed with the Securities and Exchange Commission (SEC) in
connection with the proposed merger. Additional risks and uncertainties
are identified and discussed in our reports filed with the SEC and
available at the SEC’s website at www.sec.gov.
Forward-looking statements included in this presentation speak only as
of the date of this presentation. We do not undertake any obligation to
update our forward-looking statements to reflect events or circumstances
after the date of this presentation.
Important Information For Investors And Shareholders
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of any
vote or approval. This communication may be deemed to be solicitation
material in respect of the proposed transaction between UIL Holdings and
Iberdrola USA. In connection with the proposed merger between UIL
Holdings and Iberdrola USA, Iberdrola USA has filed with the SEC a
registration statement on Form S-4, as amended, containing a preliminary
prospectus of Iberdrola USA and a preliminary proxy statement of UIL
Holdings. UIL HOLDINGS AND IBERDROLA USA URGE INVESTORS AND SHAREHOLDERS
TO READ THE DEFINITIVE PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED
MERGER WHEN IT BECOMES AVAILABLE, AS WELL AS ALL OTHER RELEVANT
DOCUMENTS FILED OR THAT WILL BE FILED WITH THE SEC, BECAUSE THEY CONTAIN
OR WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.
This communication is not a substitute for the registration statement,
definitive proxy statement/prospectus or any other documents that
Iberdrola USA or UIL Holdings may file with the SEC or send to
shareholders in connection with the proposed transaction.
You may obtain copies of all documents filed with the SEC regarding the
proposed transaction (when available), free of charge, at the SEC’s
website (www.sec.gov).
Copies of the documents filed with the SEC by UIL Holdings are also
available free of charge on UIL Holdings’ website at www.uil.com
or by contacting UIL Holdings’ Investor Relations Department at
203-499-2409. UIL Holdings will mail the definitive proxy
statement/prospectus to its shareholders when it becomes available.
Participants in Solicitation
UIL Holdings and its directors and executive officers, and Iberdrola USA
and its directors and executive officers, may be deemed to be
participants in the solicitation of proxies from the holders of UIL
Holdings common stock in respect of the proposed transaction.
Information about UIL Holdings’ executive officers and directors is set
forth in UIL Holdings’ definitive proxy statement for its 2015 Annual
Meeting of Shareholders, which was filed with the SEC on April 1, 2015.
Other information regarding the interests of such individuals, as well
as information regarding Iberdrola USA’s directors and executive
officers, is set forth in the proxy statement/prospectus, which is
included in Iberdrola USA’s registration on Form S-4, as amended, filed
with the SEC. You may obtain free copies of these documents as described
in the preceding paragraph.
The following are summaries of UIL’s unaudited consolidated financial
information for the third quarter and first nine months of 2015:
UIL HOLDINGS CORPORATION
|
CONSOLIDATED STATEMENT OF INCOME
|
(In Thousands except per share amounts)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
September 30,
|
|
September 30,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
Operating Revenues
|
|
$
|
330,524
|
|
|
$
|
293,026
|
|
|
$
|
1,226,584
|
|
|
$
|
1,198,982
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses
|
|
|
|
|
|
|
|
|
Operation
|
|
|
|
|
|
|
|
|
Purchased power
|
|
|
47,041
|
|
|
|
37,962
|
|
|
|
180,858
|
|
|
|
123,771
|
|
Natural gas purchased
|
|
|
26,313
|
|
|
|
30,814
|
|
|
|
240,934
|
|
|
|
322,296
|
|
Operation and maintenance
|
|
|
111,286
|
|
|
|
95,251
|
|
|
|
315,637
|
|
|
|
290,828
|
|
Transmission wholesale
|
|
|
30,272
|
|
|
|
25,802
|
|
|
|
67,969
|
|
|
|
65,777
|
|
Depreciation and amortization
|
|
|
40,615
|
|
|
|
35,578
|
|
|
|
123,279
|
|
|
|
112,408
|
|
Taxes - other than income taxes
|
|
|
35,196
|
|
|
|
32,897
|
|
|
|
108,345
|
|
|
|
102,974
|
|
Merger and acquisition-related expenses
|
|
|
600
|
|
|
|
570
|
|
|
|
7,395
|
|
|
|
6,090
|
|
Total Operating Expenses
|
|
|
291,323
|
|
|
|
258,874
|
|
|
|
1,044,417
|
|
|
|
1,024,144
|
|
Operating Income
|
|
|
39,201
|
|
|
|
34,152
|
|
|
|
182,167
|
|
|
|
174,838
|
|
|
|
|
|
|
|
|
|
|
Other Income and (Deductions), net
|
|
|
|
|
|
|
|
|
Acquisition-related bridge facility fees
|
|
|
-
|
|
|
|
(849
|
)
|
|
|
-
|
|
|
|
(15,188
|
)
|
Other income and (deductions)
|
|
|
4,221
|
|
|
|
4,336
|
|
|
|
12,883
|
|
|
|
12,822
|
|
Total Other Income and (Deductions), net
|
|
|
4,221
|
|
|
|
3,487
|
|
|
|
12,883
|
|
|
|
(2,366
|
)
|
|
|
|
|
|
|
|
|
|
Interest Charges, net
|
|
|
|
|
|
|
|
|
Interest on long-term debt
|
|
|
22,510
|
|
|
|
22,386
|
|
|
|
66,952
|
|
|
|
67,286
|
|
Other interest, net
|
|
|
1,286
|
|
|
|
636
|
|
|
|
3,922
|
|
|
|
1,203
|
|
|
|
|
23,796
|
|
|
|
23,022
|
|
|
|
70,874
|
|
|
|
68,489
|
|
Amortization of debt expense and redemption premiums
|
|
|
591
|
|
|
|
619
|
|
|
|
1,807
|
|
|
|
1,833
|
|
Total Interest Charges, net
|
|
|
24,387
|
|
|
|
23,641
|
|
|
|
72,681
|
|
|
|
70,322
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income from Equity Investments
|
|
|
3,408
|
|
|
|
3,492
|
|
|
|
10,284
|
|
|
|
10,398
|
|
|
|
|
|
|
|
|
|
|
Income Before Income Taxes
|
|
|
22,443
|
|
|
|
17,490
|
|
|
|
132,653
|
|
|
|
112,548
|
|
|
|
|
|
|
|
|
|
|
Income Taxes
|
|
|
6,811
|
|
|
|
4,986
|
|
|
|
43,566
|
|
|
|
35,276
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
|
15,632
|
|
|
|
12,504
|
|
|
|
89,087
|
|
|
|
77,272
|
|
Less:
|
|
|
|
|
|
|
|
|
Preferred Stock Dividends of
|
|
|
|
|
|
|
|
|
Subsidiary, Noncontrolling Interests
|
|
|
6
|
|
|
|
6
|
|
|
|
20
|
|
|
|
(21
|
)
|
|
|
|
|
|
|
|
|
|
Net Income attributable to UIL Holdings
|
|
$
|
15,626
|
|
|
$
|
12,498
|
|
|
$
|
89,067
|
|
|
$
|
77,293
|
|
|
|
|
|
|
|
|
|
|
Average Number of Common Shares Outstanding - Basic
|
|
|
57,150
|
|
|
|
56,855
|
|
|
|
57,120
|
|
|
|
56,827
|
|
Average Number of Common Shares Outstanding - Diluted
|
|
|
57,438
|
|
|
|
57,133
|
|
|
|
57,420
|
|
|
|
57,114
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share of Common Stock - Basic:
|
|
$
|
0.27
|
|
|
$
|
0.22
|
|
|
$
|
1.56
|
|
|
$
|
1.36
|
|
|
|
|
|
|
|
|
|
|
Earnings Per Share of Common Stock - Diluted:
|
|
$
|
0.27
|
|
|
$
|
0.22
|
|
|
$
|
1.55
|
|
|
$
|
1.35
|
|
|
|
|
|
|
|
|
|
|
Cash Dividends Declared per share of Common Stock
|
|
$
|
0.432
|
|
|
$
|
0.432
|
|
|
$
|
0.864
|
|
|
$
|
1.296
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UIL HOLDINGS CORPORATION
|
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
|
(Thousands of Dollars)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
September 30,
|
|
September 30,
|
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
Net Income
|
|
$
|
15,632
|
|
|
$
|
12,504
|
|
|
$
|
89,087
|
|
|
$
|
77,272
|
|
Other Comprehensive Income (Loss), net of income taxes
|
|
|
|
|
|
|
|
|
Changes in unrealized gains (losses) related to pension and other
post-retirement benefit plans
|
|
|
(64
|
)
|
|
|
(104
|
)
|
|
|
(154
|
)
|
|
|
126
|
|
Other
|
|
|
3
|
|
|
|
(6
|
)
|
|
|
2
|
|
|
|
3
|
|
Total Other Comprehensive Income (Loss), net of income taxes
|
|
|
(61
|
)
|
|
|
(110
|
)
|
|
|
(152
|
)
|
|
|
129
|
|
Comprehensive Income
|
|
|
15,571
|
|
|
|
12,394
|
|
|
|
88,935
|
|
|
|
77,401
|
|
Less:
|
|
|
|
|
|
|
|
|
Preferred Stock Dividends of Subsidiary, Noncontrolling Interests
|
|
|
6
|
|
|
|
6
|
|
|
|
20
|
|
|
|
(21
|
)
|
Comprehensive Income Attributable to UIL Holdings
|
|
$
|
15,565
|
|
|
$
|
12,388
|
|
|
$
|
88,915
|
|
|
$
|
77,422
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
UIL HOLDINGS CORPORATION
|
CONDENSED CONSOLIDATED BALANCE SHEET
|
(Unaudited)
|
|
|
|
|
|
|
|
September 30,
|
|
December 31,
|
(thousands of dollars)
|
|
2015
|
|
2014
|
ASSETS
|
|
|
|
|
Current assets
|
|
$
|
562,667
|
|
$
|
670,096
|
Other investments
|
|
|
138,055
|
|
|
139,972
|
Net property, plant and equipment
|
|
|
3,485,452
|
|
|
3,292,690
|
Regulatory assets
|
|
|
683,297
|
|
|
687,198
|
Goodwill
|
|
|
266,205
|
|
|
266,205
|
Deferred charges and other assets
|
|
|
36,690
|
|
|
55,774
|
Total Assets
|
|
$
|
5,172,366
|
|
$
|
5,111,935
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND CAPITALIZATION
|
|
|
|
|
Current liabilities
|
|
$
|
434,804
|
|
$
|
495,558
|
Deferred income taxes
|
|
|
620,009
|
|
|
585,335
|
Regulatory liabilities
|
|
|
524,077
|
|
|
491,896
|
Other noncurrent liabilities
|
|
|
474,617
|
|
|
459,476
|
Total Liabilities
|
|
|
2,053,507
|
|
|
2,032,265
|
|
|
|
|
|
Long-term debt, net of unamortized discount and premium
|
|
|
1,730,306
|
|
|
1,711,349
|
Preferred stock of subsidiary
|
|
|
119
|
|
|
119
|
Net common stock equity
|
|
|
1,388,434
|
|
|
1,368,202
|
Total Capitalization
|
|
|
3,118,859
|
|
|
3,079,670
|
|
|
|
|
|
Total Liabilities and Capitalization
|
|
$
|
5,172,366
|
|
$
|
5,111,935
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20151102006721/en/ Copyright Business Wire 2015
Source: Business Wire
(November 2, 2015 - 4:10 PM EST)
News by QuoteMedia
www.quotemedia.com
|