- Utility Group third quarter earnings were $18.7 million, or $0.22 per share, in 2010 compared to $8.7 million, or $0.11 per share, in 2009. Year to date, Utility Group earnings were $90.3 million, or $1.11 per share, compared to $71.5 million, or $0.89 per share, in 2009.
- Nonutility Group losses were ($2.2) million, or ($0.02) per share in the third quarter of 2010, compared to net income of $3.3 million, or $0.04 per share, in 2009. The decrease is attributable to results from ProLiance Energy, LLC. Results for the third quarter of 2010 from all other Nonutility Group businesses were nearly equal to the prior year quarter.
Gas utility margins were $69.4 million and $321.1 million for the three and nine months ended September 30, 2010. Following are reconciliations of the changes from 2009:
Three Year to
Months Date
(millions) ------------ ------------
2009 Gas Utility Margin $ 65.4 $ 319.3
Impact of Ohio territory straight fixed
variable rate design 3.3 2.9
Large customer usage 1.6 3.7
Operating costs directly recovered in margin (0.7) (2.7)
All other, mostly lower miscellaneous revenues
due to lower gas costs (0.2) (2.1)
------------ ------------
Total change in Gas Utility Margin 4.0 1.8
------------ ------------
2010 Gas Utility Margin $ 69.4 $ 321.1
============ ============
The rate design approved by the Public Utility Commission of Ohio (PUCO) on
January 7, 2009, and initially implemented on February 22, 2009, allowed
for the phased movement toward a straight fixed variable rate design, which
places substantially all of the fixed cost recovery in the customer service
charge. This rate design mitigates most weather risk as well as the
effects of declining usage, similar to the company's lost margin recovery
mechanism in place in the Indiana natural gas service territories and the
mechanism in place in Ohio prior to this rate order. Starting in February
2010, nearly 90 percent of the combined residential and commercial base
rate gas margins began being recovered through the customer service charge.
As a result, some margin previously recovered during the peak delivery
winter months is more ratably recognized throughout the year. The impact
of this rate design change is increased margin of approximately $3.3
million in the quarter and $2.9 million year to date, or approximately
$0.02 per share, compared to the prior year periods. The year to date
impact is the amount expected for the full year period.
Electric Utility MarginRetail Margin
Electric retail utility margins were $101.9 million and $268.0 million for the three and nine months ended September 30, 2010. Following are reconciliations of the changes from 2009:
Three Year to
Months Date
(millions) ------------ -------------
2009 Retail Electric Margin $ 87.3 $ 238.0
Weather 9.9 13.1
Large customer usage 3.8 10.5
Return on pollution control and other
investments 0.7 3.3
Recovery of tracked MISO and pollution control
operating costs 1.1 3.1
All other (0.9) -
------------ -------------
Total increase in Retail Electric Margin 14.6 30.0
------------ -------------
2010 Retail Electric Margin $ 101.9 $ 268.0
============ =============
Margin from Wholesale ActivitiesFor the three and nine months ended September 30, 2010, wholesale margin was $6.8 million and $20.8 million, representing an increase of $1.2 million and $5.5 million, respectively, compared to 2009. The company earns a return on electric transmission projects constructed by the company in its service territory that meet the criteria of the Midwest Independent System Operator's (MISO) transmission expansion plans. Margin associated with these projects, including the reconciliation of recovery mechanisms, and other transmission system operations, totaled $4.2 million and $14.8 million for the three and nine months ended September 30, 2010, respectively, compared to $4.4 million and $11.0 million in both the three and nine months ended September 30, 2009. During 2010, margin from off-system sales retained by the company has increased $1.4 million in the quarter and $1.7 million year to date compared to the prior year periods. Other Operating Other operating expenses were $70.5 million for the three months ended September 30, 2010, and $223.3 million in the nine months ended September 30, 2010. Following are reconciliations of the changes from 2009:
Three Year to
Months Date
(millions) ------------ ------------
2009 Other Operating Expenses $ 69.9 $ 227.9
Operating costs recovered in margin, such as
Ohio bad debt cost recovery,
conservation program cost recovery and
environmental related cost recovery 0.4 1.8
Power plant outage maintenance costs, largely
due to timing 1.0 (3.2)
Indiana uncollectible accounts expense (2.7) (3.6)
All other 1.9 0.4
------------ ------------
Total Change in Other Operating Expenses 0.6 (4.6)
------------ ------------
2010 Other Operating Expenses $ 70.5 $ 223.3
============ ============
Depreciation & Amortization
For the three and nine months ended September 30, 2010, depreciation
expense was $47.2 million and $140.5 million, which represent increases of
$1.3 million and $5.7 million compared to 2009. This increase is
reflective of utility capital expenditures placed into service.
Taxes Other Than Income Taxes
For the three and nine months ended September 30, 2010, taxes other than
income taxes were $11.2 million and $45.1 million, respectively, which
reflect a minor increase in the quarter and a decrease of ($1.1) million
year over year. The year to date decrease is primarily attributable to
lower utility receipts, excise, and usage taxes that are directly offset in
margin.
Other Income-Net
Other income-net reflects income of $0.9 million and $3.9 million for the
three and nine months ended September 30, 2010, compared to $2.1 million
and $6.1 million for the same periods in 2009. The higher earnings in 2009
reflect the partial recovery from 2008 market declines associated with
investments related to benefit plans.
Interest Expense
For the three and nine months ended September 30, 2010, interest expense
was $20.4 million and $61.0 million, which represents a minor increase in
the quarter and $2.1 million year over year compared to 2009. These small
increases reflect the impact of long-term financing transactions completed
in 2009, offset by lower interest from less debt outstanding overall.
Income Taxes
For the three and nine months ended September 30, 2010, federal and state
income taxes were $11.4 million and $54.8 million, which represent
increases of $6.1 million and $14.2 million compared to 2009. The higher
taxes are primarily due to increased pretax income. The year to date
increase is also reflective of a lower effective rate in 2009 due to tax
adjustments recorded in 2009.
Nonutility Group Discussion
All amounts included in this section are after tax. Results reported by
company are net of allocated corporate expenses. Results from the
Nonutility Group were a loss of ($0.02) per share for the quarter ended
September 30, 2010, compared to earnings of $0.04 in the prior year
quarter. The decrease of ($0.06) is all attributable to ProLiance.
Energy Marketing and Services
Energy Marketing and Services is comprised of the company's gas marketing
operations, energy management services, and retail gas supply operations.
Results from Energy Marketing and Services for the quarter ended September
30, 2010, were a loss of ($10.4) million, compared to a loss of ($4.8)
million in 2009. For the nine months ended September 30, 2010, losses were
($9.1) million compared to a loss of ($5.9) million in 2009. The 2009 year
to date results include an ($11.9) million after tax, or ($0.15) per share,
charge related to an investment by ProLiance Energy, LLC in Liberty Gas
Storage, LLC.
During the third quarter of 2010, ProLiance operated at a loss of
approximately ($6.9) million compared to a loss of ($1.8) million in 2009.
During the nine months ended September 30, 2010, ProLiance operated at a
loss of approximately ($9.9) million compared to earnings of $2.1 million,
excluding the Liberty charge, in 2009. The ($5.1) million unfavorable
change in the quarter and ($12.0) million for the year reflects reduced
margins associated with optimizing its transportation and storage portfolio
due primarily to a reduction of firm transportation spread values between
the production areas and Midwest market area. The regional basis spread
reduction impacting firm transportation values is due to a number of
factors. Those factors include recent warmer than normal weather, shifting
gas flows associated with the completion of new shale gas production and
related transportation infrastructure, and the continuation of reduced
industrial demand. ProLiance has structured optimization activities to
remain flexible to maximize potential opportunities if market conditions
improve. ProLiance's storage capacity was 46 Bcf at both September 30,
2010, and December 31, 2009.
Vectren Source, the company's retail gas marketer, incurred a seasonal loss
of approximately ($3.5) million in the third quarter of 2010, compared to
($3.0) million in 2009. Year to date, Vectren Source has earned $0.8
million in 2010 compared to $3.9 million in 2009. Year to date results
were lower than the prior year, as expected, due to higher margins on
variable priced contracts in the first quarter of 2009. During 2009's
first quarter, revenues on variable priced sales contracts fell more slowly
than gas costs. The ($0.5) million decrease in the 2010 third quarter
results from lower volumes sold due to the mild September weather. Vectren
Source's customer count at September 30, 2010, was approximately 204,000
customers, compared to 186,000 customers at September 30, 2009.
Coal Mining
Coal Mining owns mines that produce and sell coal to the company's utility
operations and to third parties through the company's wholly owned
subsidiary, Vectren Fuels, Inc. (Fuels).
Coal Mining results were approximately $2.5 million during the third
quarter of 2010, compared to $4.0 million in 2009, a decrease of ($1.5)
million compared to 2009. Year to date, Coal Mining results were earnings
of $8.1 million compared to $7.4 million in 2009. The year to date
increase is primarily due to lower contract mining costs, higher revenue
per ton, and an increase in tons sold, offset by an increase in interest
expense and other costs. There has been some improvement in the current
demand and supply imbalance for Illinois Basin coal during 2010. Energy
demand is returning as evidenced by some spot coal sale opportunities.
Year to date, orders for 525,000 tons of spot coal, with 140,000 tons yet
to be delivered in the fourth quarter of 2010, have been received.
Further, there has been some non-weather related improvement in demand for
electricity; however, coal inventories remain elevated at customer
locations. Vectren Fuels continues to align its coal production closely
with short-term customer needs. Negotiations for a number of new term
supply contracts with other customers are currently progressing.
Energy Infrastructure Services
Energy Infrastructure Services provides underground utility infrastructure
construction and repair services through Miller Pipeline Corporation
(Miller) and energy performance contracting and renewable energy services
through Energy Systems Group (ESG). Energy Infrastructure Services earned
$6.0 million in the third quarter of 2010, compared to $4.6 million in
2009. Year to date earnings were $6.4 million in 2010 compared to
earnings of $7.6 million in 2009.
Miller's 2010 third quarter earnings were $3.2 million compared to $1.9
million in 2009. The increase in earnings is due primarily to the
completion of a large transmission project. Year to date, Miller's
earnings contribution of approximately $2.2 million is consistent with
earnings in 2009. Year to date results in 2010 reflect improved third
quarter performance, offset by weather conditions that negatively impacted
construction activities in the Mid-Atlantic and Northeast throughout much
of the first quarter of 2010. As utilities across the country continue to
replace their aging natural gas and wastewater infrastructure and needs for
shale gas infrastructure become more prevalent, Miller is positioned for
future growth and resulting earnings.
ESG's 2010 earnings were $2.8 million in the third quarter and were
consistent with third quarter earnings in 2009. ESG earned approximately
$4.2 million year to date in 2010, compared to earnings of $5.4 million in
2009. The lower year to date contribution is primarily reflective of lower
earnings from renewable energy projects as year to date results in 2009
reflect the sale of a renewable energy project. The project developed by
ESG as part of its ongoing renewable energy project development strategy
was a 3.2 megawatt land fill gas facility located in the company's electric
service territory. The sale to the company's electric utility, as a part
of the utilities' strategy to continue to build a renewable energy
portfolio, was approved by the IURC.
At September 30, 2010, ESG's backlog was $64 million, compared to $70
million at December 31, 2009. The backlog reflects substantial work in the
near term and ESG is on track to meet expectations. The national focus on
a comprehensive energy strategy as evidenced by the Energy Independence and
Security Act of 2007 and the American Recovery and Reinvestment Act of 2009
continues to create favorable conditions for ESG's growth and resulting
earnings.
Other Businesses
Third quarter results in both 2010 and 2009 include losses from Other
nonutility businesses, which include legacy real estate and other
investments. During the nine months ended September 30, 2010, other
nonutility businesses operated at a loss of ($7.3) million compared to a
loss of ($2.3) million in 2009. The lower results in 2010 reflect a second
quarter ($4.0) million after tax charge related to a decline in the fair
value of an energy-related investment originally made in 2004 by Haddington
Energy Partners. The lower results in 2010 also reflect a first quarter
2010 ($2.9) million after tax charge related to the reduction in value of a
note receivable recorded in 2002 related to a previously exited business.
Please SEE ATTACHED unaudited schedules for additional financial
information
Live Webcast on November 10, 2010Vectren's financial analyst call will be at 2:00 p.m. (EST), November 10, 2010, at which time management will discuss financial results and 2010 earnings guidance. To participate in the call, analysts are asked to dial 1-888-818-6237 ten (10) minutes prior to the start time and refer to the "Vectren Corporation 3rd Quarter" conference call. All interested parties may listen to the live webcast accompanied by a slide presentation at www.vectren.com. A replay of the webcast will be made available at the same location approximately two hours following the conclusion of the meeting. About Vectren
Vectren Corporation is an energy holding company headquartered in Evansville, Indiana. Vectren's energy delivery subsidiaries provide gas and/or electricity to over one million customers in adjoining service territories that cover nearly two-thirds of Indiana and west central Ohio. Vectren's nonutility subsidiaries and affiliates currently offer energy-related products and services to customers throughout the Midwest, Northeast, and Southeast. These include gas marketing and related services; coal production and sales; and energy infrastructure services. To learn more about Vectren, visit www.vectren.com. Forward-Looking Statements
All statements other than statements of historical fact included in this news release are forward-looking statements made in good faith by the company and are intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Such statements are based on management's beliefs, as well as assumptions made by and information currently available to management and include such words as "believe," "anticipate," "endeavor," "estimate," "expect," "objective," "projection," "forecast," "goal," "likely," and similar expressions intended to identify forward-looking statements. Vectren cautions readers that the assumptions forming the basis for forward-looking statements include many factors that are beyond Vectren's ability to control or estimate precisely and actual results could differ materially from those contained in this document. In addition to any assumptions and other factors referred to specifically in connection with such forward-looking statements, factors that could cause the company's actual results to differ materially from those contemplated in any forward-looking statements include, among others, the following: Factors affecting utility operations such as unusual weather conditions; catastrophic weather-related damage; unusual maintenance or repairs; unanticipated changes to fossil fuel costs; unanticipated changes to gas transportation and storage costs, or availability due to higher demand, shortages, transportation problems or other developments; environmental or pipeline incidents; transmission or distribution incidents; unanticipated changes to electric energy supply costs, or availability due to demand, shortages, transmission problems or other developments; or electric transmission or gas pipeline system constraints. Catastrophic events such as fires, earthquakes, explosions, floods, ice storms, tornados, terrorist acts or other similar occurrences could adversely affect Vectren's facilities, operations, financial condition and results of operations. Increased competition in the energy industry, including the effects of industry restructuring and unbundling. Regulatory factors such as unanticipated changes in rate-setting policies or procedures, recovery of investments and costs made under traditional regulation, and the frequency and timing of rate increases. Financial, regulatory or accounting principles or policies imposed by the Financial Accounting Standards Board; the Securities and Exchange Commission; the Federal Energy Regulatory Commission; state public utility commissions; state entities which regulate electric and natural gas transmission and distribution, natural gas gathering and processing, electric power supply; and similar entities with regulatory oversight. Economic conditions including the effects of an economic downturn, inflation rates, commodity prices, and monetary fluctuations. Economic conditions surrounding the recession, which may be more prolonged and more severe than cyclical downturns, including significantly lower levels of economic activity; uncertainty regarding energy prices and the capital and commodity markets; decreases in demand for natural gas, electricity, coal, and other nonutility products and services; impacts on both gas and electric large customers; lower residential and commercial customer counts; higher operating expenses; and further reductions in the value of certain nonutility real estate and other legacy investments. Increased natural gas and coal commodity prices and the potential impact on customer consumption, uncollectible accounts expense, unaccounted for gas and interest expense. Changing market conditions and a variety of other factors associated with physical energy and financial trading activities including, but not limited to, price, basis, credit, liquidity, volatility, capacity, interest rate, and warranty risks. Direct or indirect effects on the company's business, financial condition, liquidity and results of operations resulting from changes in credit ratings, changes in interest rates, and/or changes in market perceptions of the utility industry and other energy-related industries. The performance of projects undertaken by the company's nonutility businesses and the success of efforts to invest in and develop new opportunities, including but not limited to, the company's coal mining, gas marketing, and energy infrastructure strategies. Factors affecting coal mining operations including MSHA guidelines and interpretations of those guidelines, as well as additional mine regulations and more frequent and broader inspections that could result from the recent mining incidents at coal mines of other companies; geologic, equipment, and operational risks; the ability to execute and negotiate new sales contracts and resolve contract interpretations; volatile coal market prices and demand; supplier and contract miner performance; the availability of key equipment, contract miners and commodities; availability of transportation; and the ability to access/replace coal reserves . Employee or contractor workforce factors including changes in key executives, collective bargaining agreements with union employees, aging workforce issues, work stoppages, or pandemic illness. Legal and regulatory delays and other obstacles associated with mergers, acquisitions and investments in joint ventures. Costs, fines, penalties and other effects of legal and administrative proceedings, settlements, investigations, claims, including, but not limited to, such matters involving compliance with state and federal laws and interpretations of these laws. Changes in or additions to federal, state or local legislative requirements, such as changes in or additions to tax laws or rates, environmental laws, including laws governing greenhouse gases, mandates of sources of renewable energy, and other regulations. More detailed information about these factors is set forth in Vectren's filings with the Securities and Exchange Commission, including Vectren's 2009 annual report on Form 10-K filed on February 26, 2010. The company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of changes in actual results, changes in assumptions, or other factors affecting such statements.
VECTREN CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF INCOME
(Millions, except per share amounts)
(Unaudited)
Three Months Nine Months
Ended September 30 Ended September 30
-------------------- --------------------
2010 2009 2010 2009
--------- --------- --------- ---------
OPERATING REVENUES:
Gas utility $ 101.8 $ 93.4 $ 692.8 $ 759.9
Electric utility 173.2 143.0 469.1 400.7
Nonutility 147.7 113.2 403.5 359.7
--------- --------- --------- ---------
Total operating revenues 422.7 349.6 1,565.4 1,520.3
--------- --------- --------- ---------
OPERATING EXPENSES:
Cost of gas sold 32.4 28.0 371.7 440.6
Cost of fuel and purchased
power 64.5 50.1 180.3 147.4
Cost of nonutility revenues 60.7 36.2 170.6 153.7
Other operating 137.2 129.6 398.4 377.6
Depreciation and amortization 57.6 53.9 170.6 158.3
Taxes other than income taxes 11.7 11.3 46.9 48.0
--------- --------- --------- ---------
Total operating expenses 364.1 309.1 1,338.5 1,325.6
--------- --------- --------- ---------
OPERATING INCOME 58.6 40.5 226.9 194.7
OTHER INCOME (EXPENSE):
Equity in earnings (losses)
of unconsolidated affiliates (8.2) (0.6) (13.9) (11.3)
Other income - net 1.6 4.1 2.0 10.6
--------- --------- --------- ---------
Total other income
(expense) (6.6) 3.5 (11.9) (0.7)
--------- --------- --------- ---------
INTEREST EXPENSE 26.0 25.8 78.0 74.0
--------- --------- --------- ---------
INCOME BEFORE INCOME TAXES 26.0 18.2 137.0 120.0
INCOME TAXES 9.6 5.8 48.7 41.5
--------- --------- --------- ---------
NET INCOME $ 16.4 $ 12.4 $ 88.3 $ 78.5
========= ========= ========= =========
AVERAGE COMMON SHARES
OUTSTANDING 81.2 80.8 81.1 80.7
DILUTED COMMON SHARES
OUTSTANDING 81.4 81.1 81.3 81.0
EARNINGS PER SHARE OF COMMON
STOCK
BASIC $ 0.20 $ 0.15 $ 1.09 $ 0.97
========= ========= ========= =========
DILUTED $ 0.20 $ 0.15 $ 1.09 $ 0.97
========= ========= ========= =========
VECTREN UTILITY HOLDINGS
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF INCOME
(Millions)
(Unaudited)
Three Months Nine Months
Ended September 30 Ended September 30
------------------- -------------------
2010 2009 2010 2009
--------- --------- --------- ---------
OPERATING REVENUES:
Gas utility $ 101.8 $ 93.4 $ 692.8 $ 759.9
Electric utility 173.2 143.0 469.1 400.7
Other 0.4 0.4 1.2 1.2
--------- --------- --------- ---------
Total operating revenues 275.4 236.8 1,163.1 1,161.8
--------- --------- --------- ---------
OPERATING EXPENSES:
Cost of gas sold 32.4 28.0 371.7 440.6
Cost of fuel and purchased power 64.5 50.1 180.3 147.4
Other operating 70.5 69.9 223.3 227.9
Depreciation and amortization 47.2 45.9 140.5 134.8
Taxes other than income taxes 11.2 10.8 45.1 46.2
--------- --------- --------- ---------
Total operating expenses 225.8 204.7 960.9 996.9
--------- --------- --------- ---------
OPERATING INCOME 49.6 32.1 202.2 164.9
OTHER INCOME - NET 0.9 2.1 3.9 6.1
INTEREST EXPENSE 20.4 20.2 61.0 58.9
--------- --------- --------- ---------
INCOME BEFORE INCOME TAXES 30.1 14.0 145.1 112.1
INCOME TAXES 11.4 5.3 54.8 40.6
--------- --------- --------- ---------
NET INCOME $ 18.7 $ 8.7 $ 90.3 $ 71.5
========= ========= ========= =========
VECTREN CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED BALANCE SHEETS
(Millions - Unaudited)
September December
30, 31,
2010 2009
--------- ---------
ASSETS
Current Assets
Cash & cash equivalents $ 7.2 $ 11.9
Accounts receivable - less reserves of $4.2 &
$5.2, respectively 132.5 162.4
Accrued unbilled revenues 54.7 144.7
Inventories 188.3 167.8
Recoverable fuel & natural gas costs 12.5 -
Prepayments & other current assets 111.0 95.1
--------- ---------
Total current assets 506.2 581.9
--------- ---------
Utility Plant
Original cost 4,737.4 4,601.4
Less: accumulated depreciation & amortization 1,808.7 1,722.6
--------- ---------
Net utility plant 2,928.7 2,878.8
--------- ---------
Investments in unconsolidated affiliates 124.9 186.2
Other utility and corporate investments 32.5 33.2
Other nonutility investments 40.9 46.2
Nonutility property - net 485.5 482.6
Goodwill - net 242.0 242.0
Regulatory assets 185.7 187.9
Other assets 33.7 33.0
--------- ---------
TOTAL ASSETS $ 4,580.1 $ 4,671.8
========= =========
LIABILITIES & SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable $ 132.9 $ 183.8
Accounts payable to affiliated companies 23.5 54.1
Refundable fuel & natural gas costs - 22.3
Accrued liabilities 183.5 174.7
Short-term borrowings 157.3 213.5
Current maturities of long-term debt 48.2 48.0
Long-term debt subject to tender - 51.3
--------- ---------
Total current liabilities 545.4 747.7
--------- ---------
Long-term Debt - Net of Current Maturities &
Debt Subject to Tender 1,590.3 1,540.5
Deferred Income Taxes & Other Liabilities
Deferred income taxes 495.0 458.7
Regulatory liabilities 331.6 322.1
Deferred credits & other liabilities 207.0 205.6
--------- ---------
Total deferred credits & other liabilities 1,033.6 986.4
--------- ---------
Common Shareholders' Equity
Common stock (no par value) - issued & outstanding
81.4 and 81.1 shares, respectively 675.1 666.8
Retained earnings 742.7 737.2
Accumulated other comprehensive income (loss) (7.0) (6.8)
--------- ---------
Total common shareholders' equity 1,410.8 1,397.2
--------- ---------
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY $ 4,580.1 $ 4,671.8
========= =========
VECTREN CORPORATION
AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Millions - Unaudited)
For the nine
months ended
September 30,
2010 2009
-------- --------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 88.3 $ 78.5
Adjustments to reconcile net income to cash from
operating activities:
Depreciation & amortization 170.6 158.3
Deferred income taxes & investment tax credits 33.9 55.2
Equity in losses of unconsolidated affiliates 13.9 11.3
Provision for uncollectible accounts 13.2 15.3
Expense portion of pension & postretirement benefit
cost 6.7 7.8
Other non-cash charges - net 19.4 (1.0)
Changes in working capital accounts:
Accounts receivable & accrued unbilled revenue 106.7 234.0
Inventories (20.5) (32.0)
Recoverable/refundable fuel & natural gas costs (34.8) 33.1
Prepayments & other current assets (16.4) 30.6
Accounts payable, including to affiliated
companies (82.9) (169.9)
Accrued liabilities 15.7 (17.4)
Unconsolidated affiliate dividends 42.7 11.3
Employer contributions to pension & postretirement
plans (12.4) (27.3)
Changes in noncurrent assets (9.8) (6.9)
Changes in noncurrent liabilities (11.9) (11.3)
-------- --------
Net cash flows from operating activities 322.4 369.6
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from:
Dividend reinvestment plan & other common stock
issuances 7.2 4.5
Long-term debt, net of issuance costs - 311.6
Requirements for:
Dividends on common stock (82.7) (81.2)
Retirement of long-term debt (2.1) (2.7)
Net change in short-term borrowings (56.2) (358.1)
-------- --------
Net cash flows from financing activities (133.8) (125.9)
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from:
Unconsolidated affiliate distributions 0.5 -
Other collections 10.2 1.2
Requirements for:
Capital expenditures, excluding AFUDC equity (200.9) (321.8)
Unconsolidated affiliate investments (0.2) (0.2)
Other investments (2.9) (0.8)
-------- --------
Net cash flows from investing activities (193.3) (321.6)
-------- --------
Net change in cash & cash equivalents (4.7) (77.9)
Cash & cash equivalents at beginning of period 11.9 93.2
-------- --------
Cash & cash equivalents at end of period $ 7.2 $ 15.3
======== ========
VECTREN CORPORATION
AND SUBSIDIARY COMPANIES
HIGHLIGHTS
(millions, except per share amounts)
(Unaudited)
Three Months Nine Months
Ended Ended
September 30 September 30
---------------- ----------------
2010 2009 2010 2009
------- ------- ------- -------
REPORTED EARNINGS:
Utility Group $ 18.7 $ 8.7 $ 90.3 $ 71.5
Nonutility Group
Energy Marketing and Services (10.4) (4.8) (9.1) 6.0
Charge related to Liberty Gas
Storage Investment - - - (11.9)
------- ------- ------- -------
Subtotal Energy Marketing and
Services (10.4) (4.8) (9.1) (5.9)
Coal Mining 2.5 4.0 8.1 7.4
Energy Infrastructure Services 6.0 4.6 6.4 7.6
Other Businesses (0.3) (0.5) (7.3) (2.3)
------- ------- ------- -------
Total Nonutility Group (2.2) 3.3 (1.9) 6.8
Corporate and Other (0.1) 0.4 (0.1) 0.2
------- ------- ------- -------
Vectren Consolidated $ 16.4 $ 12.4 $ 88.3 $ 78.5
======= ======= ======= =======
REPORTED EPS $ 0.20 $ 0.15 $ 1.09 $ 0.97
======= ======= ======= =======
VECTREN CORPORATION
AND SUBSIDIARY COMPANIES
SELECTED GAS DISTRIBUTION
OPERATING STATISTICS
(Unaudited)
Three Months Nine Months
Ended Ended
September 30 September 30
---------------- ----------------
2010 2009 2010 2009
------- ------- ------- -------
GAS OPERATING REVENUES (Millions):
Residential $ 65.3 $ 59.9 $ 471.7 $ 517.1
Commercial 24.6 22.0 172.6 194.4
Industrial 10.8 10.1 40.6 39.1
Other Revenue 1.1 1.4 7.9 9.3
------- ------- ------- -------
$ 101.8 $ 93.4 $ 692.8 $ 759.9
======= ======= ======= =======
GAS MARGIN (Millions):
Residential $ 45.8 $ 42.9 $ 213.2 $ 211.7
Commercial 11.7 11.9 62.4 64.2
Industrial 10.4 9.0 36.8 33.4
Other 1.5 1.6 8.7 10.0
------- ------- ------- -------
$ 69.4 $ 65.4 $ 321.1 $ 319.3
======= ======= ======= =======
GAS SOLD & TRANSPORTED (MMDth):
Residential 3.5 3.8 47.9 49.2
Commercial 2.4 2.5 21.5 22.3
Industrial 19.3 15.3 65.1 55.1
------- ------- ------- -------
25.2 21.6 134.5 126.6
======= ======= ======= =======
AVERAGE GAS CUSTOMERS
Residential 886,200 882,860 896,375 895,030
Commercial 81,725 81,914 82,709 83,109
Industrial 1,642 1,622 1,632 1,622
------- ------- ------- -------
969,567 966,396 980,716 979,761
======= ======= ======= =======
YTD WEATHER AS A PERCENT OF NORMAL:
Heating Degree Days (Ohio) 69% 100% 102% 104%
VECTREN CORPORATION
AND SUBSIDIARY COMPANIES
SELECTED ELECTRIC
OPERATING STATISTICS
(Unaudited)
Three Months Nine Months
Ended Ended
September 30 September 30
---------------- ----------------
2010 2009 2010 2009
------- ------- ------- -------
ELECTRIC OPERATING REVENUES (Millions):
Residential $ 66.1 $ 53.4 $ 164.0 $ 142.4
Commercial 40.7 36.9 113.6 105.6
Industrial 53.9 43.9 151.5 121.2
Other Revenue 2.1 1.6 5.5 4.6
------- ------- ------- -------
Total Retail 162.8 135.8 434.6 373.8
Net Wholesale Revenues 10.4 7.2 34.5 26.9
------- ------- ------- -------
$ 173.2 $ 143.0 $ 469.1 $ 400.7
======= ======= ======= =======
ELECTRIC MARGIN (Millions):
Residential $ 46.5 $ 38.8 $ 114.9 $ 102.2
Commercial 26.5 24.7 73.9 70.3
Industrial 26.9 22.3 74.1 61.2
Other 2.0 1.5 5.1 4.3
------- ------- ------- -------
Total Retail 101.9 87.3 268.0 238.0
Net Wholesale Margin 6.8 5.6 20.8 15.3
------- ------- ------- -------
$ 108.7 $ 92.9 $ 288.8 $ 253.3
======= ======= ======= =======
ELECTRICITY SOLD (GWh):
Residential 511.4 421.4 1,278.8 1,134.0
Commercial 375.5 348.6 1,036.5 988.1
Industrial 712.2 620.5 2,019.7 1,686.9
Other Sales - Street Lighting 4.9 4.5 16.0 14.1
------- ------- ------- -------
Total Retail 1,604.0 1,395.0 4,351.0 3,823.1
Wholesale 122.0 87.9 466.2 494.3
------- ------- ------- -------
1,726.0 1,482.9 4,817.2 4,317.4
======= ======= ======= =======
AVERAGE ELECTRIC CUSTOMERS
Residential 122,738 122,222 122,840 122,307
Commercial 18,335 18,388 18,341 18,360
Industrial 109 106 108 105
Other 33 33 33 33
------- ------- ------- -------
141,215 140,749 141,322 140,805
======= ======= ======= =======
YTD WEATHER AS A PERCENT OF NORMAL:
Cooling Degree Days (Indiana) 129% 79% 134% 92%
Heating Degree Days (Indiana) 22% 40% 98% 93%
Contact Information: Investor Contact Robert L. Goocher (812) 491-4080 rgoocher@vectren.com Media Contact Mike Roeder (812) 491-5255 mroeder@vectren.com