CenterPoint Energy reports Fourth Quarter and Full Year 2013 earnings
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2014-02-26T06:00:00Z
http://www.centerpointenergy.com/newsroom/newsreleases/c6bb39db8db64410VgnVCM10000026a10d0aRCRD CenterPoint Energy reports Fourth Quarter and Full Year 2013 earnings centerpointenergy.com c6bb39db8db64410VgnVCM10000026a10d0aRCRD

Houston, TX - Feb. 26, 2014 - CenterPoint Energy, Inc. (NYSE: CNP) today reported net income of $113 million, or $0.26 per diluted share, for the fourth quarter of 2013, compared to $134 million, or $0.31 per diluted share the previous year. Operating income for the fourth quarter of 2013 was $211 million. Following the May 1, 2013, formation of Enable Midstream Partners, CenterPoint Energy reports its investment in midstream operations as equity income rather than operating income. As a result, operating income for the fourth quarter of 2013 is not comparable to prior results.

For the year ended Dec. 31, 2013, net income was $311 million, or $0.72 per diluted share. The results for the year include two unusual items related to the formation of the midstream partnership: (i) a $225 million non-cash deferred tax charge and (ii) $13 million of pre-tax partnership formation expenses. Excluding the effects of these unusual items, net income for 2013 would have been $544 million, or $1.26 per diluted share.

For the year ended Dec. 31, 2012, net income was $417 million, or $0.97 per diluted share. The results for the year include two unusual items recorded in the third quarter: (i) a $252 million non-cash goodwill impairment charge associated with the energy services business, which has no tax effect, and (ii) a $136 million gain ($88 million after-tax) associated with the acquisition of an additional 50 percent interest in a gathering and processing joint venture. Excluding the effects of these unusual items, net income for 2012 would have been $581 million, or $1.35 per diluted share.

Operating income for the year ended Dec. 31, 2013, was $1.01 billion. As discussed above, with the formation of Enable Midstream Partners, CenterPoint Energy’s operating income for 2013 is not comparable to prior results.

“CenterPoint Energy's 2013 financial results highlight the strength of our diversified energy delivery business portfolio,” said Scott M. Prochazka, president and chief executive officer of CenterPoint Energy. “Our natural gas distribution business, which had its strongest annual performance, more than offset the impact of a return to more normal weather at our electric utility. In addition, our joint venture investment, Enable Midstream Partners, continues to advance toward an IPO, and we are excited about its value creation potential for our shareholders. As we look to 2014, we are confident in our ability to provide stable earnings growth from our regulated businesses, coupled with additional growth from our Enable Midstream investment.”

Electric Transmission & Distribution

The electric transmission & distribution segment reported operating income of $119 million for the fourth quarter of 2013, consisting of $87 million from the regulated electric transmission & distribution utility operations (TDU) and $32 million related to securitization bonds. Operating income for the fourth quarter of 2012 was $99 million, consisting of $64 million from the TDU and $35 million related to securitization bonds.

Fourth-quarter operating income for the TDU benefited from higher revenues associated with right-of-way easement grants, continued strong customer growth, increased usage in part due to colder weather and higher net transmission-related revenues. These increases were partially offset by higher depreciation and property taxes.

Operating income for the year ended Dec. 31, 2013, was $607 million, consisting of $474 million from the TDU and $133 million related to securitization bonds. Operating income for the same period of 2012 was $639 million, consisting of $492 million from the TDU and $147 million related to securitization bonds.

Full-year 2013 operating income for the TDU benefited from revenue increases associated with the growth of more than 44,000 metered customers, higher net transmission related revenues and slightly higher revenues associated with right-of-way easement grants. These increases were offset by lower revenues due to a return to more normal weather, as well as from higher operation and maintenance expenses, depreciation and property taxes.

Natural Gas Distribution

The natural gas distribution segment reported operating income of $94 million for the fourth quarter of 2013, compared to $91 million for the same period of 2012. Operating income benefited from rate changes and increased economic activity across its footprint, including customer growth, which were partially offset by an increase in bad-debt expenses, depreciation and property taxes.

Operating income for the year ended Dec. 31, 2013, was $263 million, compared to $226 million for the same period of 2012. Operating income benefited from colder weather compared to the previous year, as well as rate changes and increased economic activity across its footprint, including growth of approximately 33,000 customers. Increases in operation and maintenance expenses, including bad debt expense, as well as depreciation and property taxes partially offset these improvements.

Energy Services

The energy services segment reported operating income of $1 million for the fourth quarter of 2013, compared to $12 million for the same period of 2012. Fourth quarter operating income for 2013 included mark-to-market accounting charges of $9 million, compared to a charge of $1 million for the same period of 2012.

Operating income for the year ended Dec. 31, 2013, was $13 million, compared to an operating loss of $250 million for the same period of 2012. Excluding a third-quarter 2012 goodwill impairment charge, operating income for the year ended Dec. 31, 2012, would have been $2 million. Operating income for the year ended Dec. 31, 2013, included mark-to-market accounting charges of $2 million, compared to a charge of $16 million for the same period of 2012. Increased customer count and sales volumes in 2013 were more than offset by lower unit margins in competitive markets and the 2012 sale of non-strategic assets.

Other Operations

The other operations segment reported an operating loss of $3 million for the fourth quarter of 2013, compared to no income for the same period of 2012. The decline is primarily related to expenses associated with higher property taxes and depreciation. For the year ended Dec. 31, 2013, this segment reported an operating loss of $18 million, compared to operating income of $2 million for the same period of 2012. The decline is primarily related to the one-time expenses associated with the formation of Enable Midstream Partners as well as higher property taxes.

Interstate Pipelines/ Field Services

For the year ended Dec. 31, 2013, and prior to the formation of Enable Midstream Partners, the interstate pipelines segment reported operating income of $72 million and equity earnings of $7 million from its 50 percent interest in the Southeast Supply Header (SESH) and the field services segment reported operating income of $73 million.

Midstream Investments

For the year ended Dec. 31, 2013, CenterPoint Energy reported equity income of $173 million from its interest in Enable Midstream Partners and equity income of $8 million from its retained interest in SESH. Although these results cannot be readily compared to 2012, Enable Midstream’s gathering and processing operations performed in line with expectations while transportation and storage operations continued to be adversely affected by challenging market conditions.

Dividend Declaration

On Jan. 20, 2014, CenterPoint Energy’s board of directors declared a regular quarterly cash dividend of $0.2375 per share of common stock, payable on March 10, 2014, to shareholders of record as of the close of business on Feb. 14, 2014. This represents a 14.5 percent increase from the previous quarterly dividend of $0.2075, and if annualized, would equate to $0.95 per share.

Outlook for 2014

The company anticipates providing its outlook and earnings guidance for 2014 on the Feb. 26, 2014, earnings call.

Filing of Form 10-K for CenterPoint Energy, Inc.

Today, CenterPoint Energy, Inc. filed with the Securities and Exchange Commission (SEC) its Annual Report on Form 10-K for the period ended Dec. 31, 2013. A copy of that report is available on the company’s website, under the Investors section. Other filings the company makes with the SEC and other documents relating to its corporate governance can also be found on that site.

Webcast of Earnings Conference Call

CenterPoint Energy’s management will host an earnings conference call on Wednesday, Feb. 26, 2014, at 10:30 a.m. Central time or 11:30 a.m. Eastern time. Interested parties may listen to a live audio broadcast of the conference call on the company’s website under the Investors section. A
replay of the call can be accessed approximately two hours after the completion of the call and will be archived on the website for at least one year.

CenterPoint Energy, Inc., headquartered in Houston, Texas, is a domestic energy delivery company that includes electric transmission & distribution, natural gas distribution and energy services operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. The company also owns a 58.3 percent limited partner interest in Enable Midstream Partners, a partnership it jointly controls with OGE Energy Corp., which owns, operates and develops natural gas and crude oil infrastructure assets. With more than 8,500 employees, CenterPoint Energy and its predecessor companies have been in business for more than 135 years. For more information, visit the website at www.CenterPointEnergy.com.

This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events and results may differ materially from those expressed or implied by these forward-looking statements. Any statements in this news release regarding the company's future earnings, and future financial performance and results of operations, and any other statements that are not historical facts are forward-looking statements. Each forward-looking statement contained in this news release speaks only as of the date of this release. Factors that could affect actual results include (1) state and federal legislative and regulatory actions or developments affecting various aspects of CenterPoint Energy's businesses (including the businesses of Enable Midstream Partners (Enable)), including, among others, energy deregulation or re-regulation, pipeline integrity and safety, health care reform, financial reform, tax legislation, and actions regarding the rates charged by CenterPoint Energy's regulated businesses; (2) state and federal legislative and regulatory actions or developments relating to the environment, including those related to global climate change; (3) timely and appropriate rate actions that allow recovery of costs and a reasonable return on investment; (4) the timing and outcome of any audits, disputes or other proceedings related to taxes; (5) problems with construction, implementation of necessary technology or other issues with respect to major capital projects that result in delays or in cost overruns that cannot be recouped in rates; (6) industrial, commercial and residential growth in CenterPoint Energy's service territories and changes in market demand, including the effects of energy efficiency measures and demographic patterns; (7) the timing and extent of changes in commodity prices, particularly natural gas and natural gas liquids, and the effects of geographic and seasonal commodity price differentials; (8) weather variations and other natural phenomena, including the impact on operations and capital from severe weather events; (9) any direct or indirect effects on CenterPoint Energy's facilities, operations and financial condition resulting from terrorism, cyber-attacks, data security breaches or other attempts to disrupt its businesses or the businesses of third parties, or other catastrophic events; (10) the impact of unplanned facility outages; (11) timely and appropriate regulatory actions allowing securitization or other recovery of costs associated with any future hurricanes or natural disasters; (12) changes in interest rates or rates of inflation; (13) commercial bank and financial market conditions, CenterPoint Energy's access to capital, the cost of such capital, and the results of its financing and refinancing efforts, including availability of funds in the debt capital markets; (14) actions by credit rating agencies; (15) effectiveness of CenterPoint Energy's risk management activities; (16) inability of various counterparties to meet their obligations; (17) non-payment for services due to financial distress of CenterPoint Energy's customers; (18) the ability of GenOn Energy, Inc. (formerly known as RRI Energy, Inc.), a wholly owned subsidiary of NRG Energy, Inc., and its subsidiaries to satisfy their obligations to CenterPoint Energy and its subsidiaries; (19) the ability of retail electric providers, and particularly the largest customers of the TDU, to satisfy their obligations to CenterPoint Energy and its subsidiaries; (20) the outcome of litigation brought by or against CenterPoint Energy or its subsidiaries; (21) CenterPoint Energy's ability to control costs; (22) the investment performance of pension and postretirement benefit plans; (23) potential business strategies, including restructurings, joint ventures, and acquisitions or dispositions of assets or businesses, for which no assurance can be given that they will be completed or will provide the anticipated benefits to CenterPoint Energy; (24) acquisition and merger activities involving CenterPoint Energy or its competitors; (25) future economic conditions in regional and national markets and their effects on sales, prices and costs; (26)  the performance of Enable, the amount of cash distributions CenterPoint Energy receives from Enable, and the value of its interest in Enable, and factors that may have a material impact on such performance, cash distributions and value, including certain of the factors specified above and: (A) the integration of the operations of the businesses contributed to Enable; (B) the achievement of anticipated operational and commercial synergies and expected growth opportunities, and the successful implementation of  Enable’s business plan; (C) competitive conditions in the midstream industry, and actions taken by Enable’s customers and competitors, including the extent and timing of the entry of additional competition in the markets served by Enable; (D) the timing and extent of changes in the supply of natural gas and associated commodity prices, particularly natural gas and natural gas liquids, the competitive effects of the available pipeline capacity in the regions served by Enable, and the effects of geographic and seasonal commodity price differentials, including the effects of these circumstances on re-contracting available capacity on Enable’s interstate pipelines; (E) the demand for natural gas, NGLs and transportation and storage services; (F) changes in tax status; (G) access to growth capital; (H) the availability and prices of raw materials for current and future construction projects; and (I) the timing and terms of Enable’s planned initial public offering, the actual consummation of which is subject to market conditions, regulatory requirements and other factors; and (27) other factors discussed in CenterPoint Energy's Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2013, and other reports CenterPoint Energy or its subsidiaries may file from time to time with the Securities and Exchange Commission.

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Governor Asa Hutchinson proclaims April as Arkansas Safe Digging Month

HOUSTON April 18, 2017Arkansas Governor Asa Hutchinson issued a proclamation announcing April as Arkansas Safe Digging Month. The proclamation reminds homeowners to call 811 before starting any outdoor digging projects to prevent injuries, property damage and inconvenient outages.

An underground utility line is damaged once every six minutes nationwide because someone decided to dig without first calling 811, according to data collected by Common Ground Alliance (CGA). 

"Contacting 811 at least two working days before digging prevents 99 percent of damages to vital underground utilities," said Vincent Vickers, supervisor of Damage Prevention for CenterPoint Energy.  "811 makes it very easy and convenient. You can submit your dig requests on your home computer on the website, www.arkonecall.com, or call 811 and talk to an operator."

By calling 811 before digging:

  • Homeowners are connected to Arkansas One Call, which notifies the appropriate utility companies of the intent to dig.
  • Professional locators are then sent to the requested digging site to mark the approximate locations of underground lines with flags and paint.
  • Once lines have been accurately marked, homeowners can dig carefully around marked lines.

Digging without knowing the approximate location of underground utilities can result in damage to gas, electric, communications, water and sewer lines, which can lead to service disruptions, serious injuries and costly repairs.


Examples of digging projects that require a call to 811 before starting would be installing a mailbox, putting in a fence, laying underground cable or installing water lines. Visit www.call811.com for more information about 811 and the call-before-you-dig process.

CenterPoint Energy, Inc., headquartered in Houston, Texas, is a domestic energy delivery company that includes electric transmission & distribution, natural gas distribution and energy services operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. The company also owns a 54.1 percent limited partner interest in Enable Midstream Partners, a publicly traded master limited partnership it jointly controls with OGE Energy Corp., which owns, operates and develops natural gas and crude oil infrastructure assets. With more than 7,700 employees, CenterPoint Energy and its predecessor companies have been in business for more than 140 years. For more information, visit the website at www.CenterPointEnergy.com

Gov. Greg Abbott proclaims April as Texas Safe Digging Month

HOUSTON April 18, 2017Texas Governor Greg Abbott issued a proclamation announcing April as Texas Safe Digging Month. The proclamation reminds homeowners to call 811 before starting any outdoor digging projects to prevent injuries, property damage and inconvenient outages.

An underground utility line is damaged once every six minutes nationwide because someone decided to dig without first calling 811, according to data collected by Common Ground Alliance (CGA). 

"Contacting 811 at least two working days before digging prevents 99 percent of damages to vital underground utilities," said Joseph Berry, director of Underground Locating for CenterPoint Energy.  "811 makes it very easy and convenient. You can submit your dig requests on your home computer at the website, www.lonestar811.com, or call 811 and talk to an operator."

By calling 811 before digging:

  • Homeowners are connected to Lone Star 811, which notifies the appropriate utility companies of the intent to dig.
  • Professional locators are then sent to the requested digging site to mark the approximate locations of underground lines with flags and paint.
  • Once lines have been accurately marked, homeowners can dig carefully around marked lines.


Digging without knowing the approximate location of underground utilities can result in damage to gas, electric, communications, water and sewer lines, which can lead to service disruptions, serious injuries and costly repairs.


Every digging project, no matter how large or small, necessitates a call to 811. Examples of digging projects that require a call to 811 before starting would be installing a mailbox, putting in a fence, laying underground cable or installing water lines.  Visit www.call811.com for more information about 811 and the call-before-you-dig process.

CenterPoint Energy, Inc., headquartered in Houston, Texas, is a domestic energy delivery company that includes electric transmission & distribution, natural gas distribution and energy services operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. The company also owns a 54.1 percent limited partner interest in Enable Midstream Partners, a publicly traded master limited partnership it jointly controls with OGE Energy Corp., which owns, operates and develops natural gas and crude oil infrastructure assets. With more than 7,700 employees, CenterPoint Energy and its predecessor companies have been in business for more than 140 years. For more information, visit the website at www.CenterPointEnergy.com

CenterPoint Energy reaches rate case settlement for Houston-area customers

HOUSTON, April 7, 2017 - CenterPoint Energy today filed with the Railroad Commission of Texas (RRC) a Stipulation and Agreement (the settlement) in the company's pending rate case. The settlement was entered into by all parties in the case, including the City of Houston/Houston Coalition of Cities, the Gulf Coast Coalition of Cities, the Texas Coast Utilities Coalition, and the Staff of the RRC. If approved by the RRC, the settlement will resolve all issues in that proceeding.

The settlement would increase the company's natural gas distribution base rate revenues for Houston-area customers by approximately $16.5 million per year. Additionally, if approved, the settlement will result in initial base rates that are the same for customers in the Houston Division and Texas Coast Division. It would also set a uniform rate for the cost of natural gas, which the company passes on to customers with no mark up.

The settlement would set new parameters, including a 9.6% return on equity on a 55.15% equity capital structure and updated depreciation rates, to be used in future Gas Reliability Infrastructure Program (GRIP) filings. GRIP is an interim rate adjustment allowed by Texas statute that allows utilities to recover their costs related to additional invested capital without filing a full rate case. CenterPoint Energy must file its next GRIP filing within two years of a final order in the pending rate case and a full rate case must be filed within five-and-a-half years after CenterPoint Energy's next GRIP filing.

If approved, residential customers within the Houston and Texas Coast Divisions would pay the same fixed monthly charge of $15.75 and the same usage rate of $0.07431 for each hundred cubic feet (Ccf) of natural gas used. An average residential bill with usage of 34 Ccf would be approximately $37 per month, excluding taxes. If the settlement is approved, the new rates are expected to go into effect in May or June of this year.

"This settlement is the result of collaborative work with all parties involved in the case to find common ground on a solution rather than litigating an extended rate case," said Randy Pryor, CenterPoint Energy's vice president of gas operations. "We believe this settlement benefits all parties and provides CenterPoint Energy the opportunity to earn a reasonable return on the investments we are making for safety and reliability now and in the future," added Pryor.

CenterPoint Energy, Inc., headquartered in Houston, Texas, is a domestic energy delivery company that includes electric transmission & distribution, natural gas distribution and energy services operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. The company also owns a 54.1 percent limited partner interest in Enable Midstream Partners, a publicly traded master limited partnership it jointly controls with OGE Energy Corp.,  which owns, operates and develops natural gas and crude oil infrastructure assets. With more than 7,700 employees, CenterPoint Energy and its predecessor companies have been in business for more than 140 years. For more information, visit the website at www.CenterPointEnergy.com.

This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements are based upon assumptions of management which are believed to be reasonable at the time made and are subject to significant risks and uncertainties. Actual events and results may differ materially from those expressed or implied by these forward-looking statements. Any statements in this news release regarding future events, such as future regulatory actions on the settlement by the RRC and the impact of such actions, and any other statements that are not historical facts are forward-looking statements. Each forward-looking statement contained in this news release speaks only as of the date of this release.

CenterPoint Energy electric transmission and distribution business files Distribution Cost Recovery Factor application

HOUSTON - April 6, 2017 - CenterPoint Energy announced today that its electric transmission and distribution business, CenterPoint Energy Houston Electric, filed an application for Distribution Cost Recovery Factor (DCRF) with the Public Utility Commission of Texas (PUC) and the cities in its service area.

DCRF is an interim rate adjustment that, if approved, permits an electric utility to implement new rates to account for changes in distribution-invested capital since its last rate case.

"Houston's economy continues to thrive and we are making significant capital investments to meet the needs of our growing customer base and load," said Kenny Mercado, senior vice president of CenterPoint Energy's Electric Operations.

This is the company's third DCRF filing and represents a $44.6 million annual increase over current rates to begin recovering approximately $479 million in distribution capital invested in 2016. The estimated residential customer impact based on a monthly usage of 1,000 kilowatt hours is an $0.80 increase billed to the consumer's Retail Electric Provider. New rates are expected to go into effect by September 1.

 

CenterPoint Energy, Inc., headquartered in Houston, Texas, is a domestic energy delivery company that includes electric transmission & distribution, natural gas distribution and energy services operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. The company also owns a 54.1 percent limited partner interest in Enable Midstream Partners, a publicly traded master limited partnership it jointly controls with OGE Energy Corp., which owns, operates and develops natural gas and crude oil infrastructure assets. With more than 7,700 employees, CenterPoint Energy and its predecessor companies have been in business for more than 140 years. For more information, visit the website at www.CenterPointEnergy.com.

This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based upon assumptions of management which are believed to be reasonable at the time made and are subject to significant risks and uncertainties. Actual events and results may differ materially from those expressed or implied by these forward-looking statements. Any statements in this news release regarding future events, such as future regulatory actions on the DCRF application, future economic conditions and any other statements that are not historical facts are forward-looking statements. Each forward-looking statement contained in this news release speaks only as of the date of this release.

CenterPoint Energy files Formula Rate Plan adjustment with Arkansas Public Service Commission

HOUSTON – April 5, 2017 - CenterPoint Energy announced today that its natural gas distribution utility filed an application with the Arkansas Public Service Commission (APSC) for a $9.1 million Formula Rate Plan (FRP) adjustment. The FRP, a formula rate review mechanism authorized by Act 725 of 2015, is an annual streamlined review of a public utility's rates to determine if adjustments are needed to recover costs related to additional invested capital and expenses without filing a full rate case. 

"We continue to make significant investments to help ensure we have a modernized, technologically advanced natural gas system that will continue to meet the needs of our customers now and in the future," said Walter Bryant, vice president of Gas Operations in Arkansas. "The FRP helps support these investments for system safety and reliability by reducing lag in a utility's recovery of necessary investments and expenses. It also smooths out rate adjustments for customers by having smaller adjustments over time versus large adjustments from time to time."

If approved, the net impact of the new rates will increase a residential customer's bill that was $100.00 to $102.48.

CenterPoint Energy, Inc., headquartered in Houston, Texas, is a domestic energy delivery company that includes electric transmission & distribution, natural gas distribution and energy services operations. The company serves more than five million metered customers primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas. The company also owns a 54.1 percent limited partner interest in Enable Midstream Partners, a publicly traded master limited partnership it jointly controls with OGE Energy Corp., which owns, operates and develops natural gas and crude oil infrastructure assets. With more than 7,700 employees, CenterPoint Energy and its predecessor companies have been in business for more than 140 years. For more information, visit the website at www.CenterPointEnergy.com.

This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based upon assumptions of management which are believed to be reasonable at the time made and are subject to significant risks and uncertainties. Actual events and results may differ materially from those expressed or implied by these forward-looking statements. Any statements in this news release regarding future events, such as future regulatory actions on the FRP adjustment application, and any other statements that are not historical facts are forward-looking statements. Each forward-looking statement contained in this news release speaks only as of the date of this release.