Houston - May 1, 2014 - CenterPoint Energy, Inc. (NYSE: CNP) today reported net income of $185 million, or $0.43 per diluted share, for the first quarter of 2014, compared to $147 million, or $0.34 per diluted share the previous year. Operating income for the first quarter of 2014 was $295 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 first quarter of 2014 is not comparable to prior results.
“This was an excellent quarter for CenterPoint Energy. Our utilities and energy services businesses met the high delivery requirements driven by continued strong customer growth and cold weather throughout our service territories,” said Scott M. Prochazka, president and chief executive officer of CenterPoint Energy. “We also reported significant equity income during the quarter from our investment in Enable Midstream Partners, which completed its IPO in April. We will continue to execute our strategy in a disciplined fashion and remain focused on achieving our financial, operational, safety and customer service objectives.”
Electric Transmission & Distribution
The electric transmission & distribution segment reported operating income of $105 million for the first quarter of 2014, consisting of $75 million from the regulated utility operations (TDU) and $30 million related to securitization bonds. Operating income for the first quarter of 2013 was $84 million, consisting of $49 million from the TDU and $35 million related to securitization bonds.
First quarter operating income for the TDU benefited from higher revenues associated with increased usage due to colder than normal weather, continued strong customer growth and right-of-way easement grants. These increases were partially offset by an increase in operating and maintenance expenses, as well as property taxes.
Natural Gas Distribution
The natural gas distribution segment reported operating income of $162 million for the first quarter of 2014, compared to $139 million for the same period of 2013. Operating income benefited from higher revenues associated with increased usage due to colder than normal weather, rate changes and increased economic activity across its footprint, including customer growth, which were partially offset by an increase in bad debt expense, depreciation and taxes.
The energy services segment reported operating income of $26 million for the first quarter of 2014, compared to $7 million for the same period of 2013. First quarter operating income included a mark-to-market gain of $4 million, compared to a charge of $5 million for the same period of 2013. Operating income primarily benefited from increased throughput and price volatility, due to weather-related capacity constraints in the Mid Continent and North Central service territories. Sales volumes increased by 14 percent year over year.
For the first quarter of 2014, CenterPoint Energy reported equity income of $88 million from its investment in Enable Midstream Partners and equity income of $3 million from its retained interest in SESH. See Enable Midstream’s earnings press release issued on April 30, 2014, for detailed results of operations.
On April 24, 2014, CenterPoint Energy’s board of directors declared a regular quarterly cash dividend of $0.2375 per share of common stock payable on June 10, 2014, to shareholders of record as of the close of business on May 16, 2014.
Outlook for 2014
CenterPoint Energy is increasing its earnings estimate for 2014 Utility Operations to be in the range of $0.72 to $0.76 from $0.68 to $0.72 per diluted share. The Utility Operations guidance range considers performance to date and significant variables that may impact earnings, such as weather, regulatory and judicial proceedings, throughput, commodity prices, effective tax rates, and financing activities. In providing this guidance, the company does not include the impact of any changes in accounting standards, any impact to earnings from the change in the value of Time Warner stocks and the related ZENS securities, or the timing effects of mark-to-market accounting in the company's energy services business.
The company also revised its 2014 earnings estimate from Midstream Investments to be in the range of $0.38 to $0.43 from $0.40 to $0.45 per diluted share. As Enable Midstream is in a quiet period, Enable has not updated its 2014 earnings forecast, therefore the only change to Midstream Investments guidance range is the dilution associated with Enable’s issuance of limited partnership units in its completed initial public offering. In providing guidance in the future, the company will take into account Enable’s most recent public forecast.
On a consolidated basis, CenterPoint Energy has increased its earnings estimate for 2014 on a guidance basis to be in the range of $1.10 to $1.19 from $1.08 to $1.17 per diluted share.
Filing of Form 10-Q for CenterPoint Energy, Inc.
Today, CenterPoint Energy, Inc. filed with the Securities and Exchange Commission (SEC) its Quarterly Report on Form 10-Q for the period ended March 31, 2014. 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 Thursday, May 1, 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 54.7 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 8,500 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.