Exhibit 99.1
| FOR IMMEDIATE RELEASE | October 31, 2011 | |
| Media Contact: Joe Salkowski, (520) 884-3625 | Page 1 of 9 | |
| Financial Analyst Contact: Chris Norman, (520) 884-3649 |
UNISOURCE ENERGY REPORTS THIRD QUARTER 2011 EARNINGS,
NARROWS 2011 EARNINGS GUIDANCE RANGE
NARROWS 2011 EARNINGS GUIDANCE RANGE
| • | UniSource Energy’s net income for the third quarter of 2011 was $59.7 million, or $1.46 per diluted share of common stock, compared with net income of $55.7 million, or $1.38 per diluted share, in the third quarter of 2010. |
| • | Financial results from the third quarter of 2011 include a $4 million after-tax gain related to the settlement of a transmission dispute involving Tucson Electric Power (TEP), UniSource Energy’s primary subsidiary. Results in the third quarter of 2010 included $5 million of non-cash, non-operating after-tax charges at Millennium Energy Holdings (Millennium), a subsidiary that holds UniSource Energy’s unregulated energy investments. |
| • | UniSource Energy narrowed its 2011 earnings guidance range of $2.60 to $2.90 per diluted share to $2.70 to 2.80 per diluted share. This new range reflects year-to-date results and includes the after-tax gain of $0.11 per diluted share recorded in the third quarter related to the transmission dispute. |
Tucson, Ariz. — UniSource Energy Corporation (NYSE: UNS) today reported third quarter 2011 net
income of $59.7 million, or $1.46 per diluted share of common stock, compared with $55.7 million,
or $1.38 per diluted share, in the same period last year.
For the nine months ended September 30, 2011, UniSource Energy’s net income was $101.8 million, or
$2.53 per diluted share of common stock, compared with net income of $101.7 million, or $2.57 per
diluted share, in the first nine months of 2010.
“We are encouraged that third quarter earnings were largely in line with our forecast despite tepid
economic conditions,” said Paul Bonavia, Chairman, President and CEO of UniSource Energy. “The
operational performance of our utility companies remains strong. We are managing operating
expenses to reflect the level of energy sales without compromising the safety or reliability of our
service.” Bonavia added, “We are narrowing our 2011 earnings guidance range to reflect
year-to-date results.”
UniSource Energy’s financial results primarily reflect those of TEP, which reported net income of
$53.9 million in the third quarter of 2011, down from $59.7 million in the third quarter of 2010.
The decrease stemmed from lower retail sales volumes, reduced margin on long-term wholesale sales,
and higher depreciation and amortization expense, partly offset by a $4 million after-tax gain
related to the settlement of a transmission dispute with El Paso Electric.
Lingering regional economic struggles contributed to a reduction in TEP’s retail sales volumes and
constrained wholesale power prices, leading to a larger-than-expected reduction in the margin on
TEP’s long-term wholesale sales.
“Our local economic recovery has not gained traction in all sectors,” Bonavia said. “Retail sales
growth in 2012 may be difficult to achieve, which means we are prepared to hold next year’s target
for base operating expenses near the same level as 2011.”
TEP’s retail kilowatt-hour (kWh) sales fell 1.3 percent compared with the third quarter of 2010.
TEP’s service area experienced hotter than normal weather in the third quarter of 2011, but cooling
degree days were slightly below the same period last year. While quarterly industrial sales held
steady and mining sales increased slightly year-over-year, sales to residential and commercial
customers were down compared with the third quarter of 2010.
TEP’s retail sales have been increasingly affected by energy efficiency programs which have
generated benefits for TEP customers through reduced bills, while scaling back the company’s retail
sales by an estimated 1 percent during the third quarter of 2011. Arizona’s Energy Efficiency
Standards require electric utilities to gradually increase the energy savings realized through
cost-effective energy efficiency and conservation programs each year.
2011 Earnings Outlook
UniSource Energy narrowed its 2011 earnings guidance range of $2.60 to $2.90 per diluted share to
$2.70 to 2.80 per diluted share. This new range reflects year-to-date results and includes the
after-tax gain of $0.11 per diluted share recorded in the third quarter related to the transmission
dispute.
Seasonality of Earnings
The net income and results of operations at TEP as well as at UNS Gas and UNS Electric — operating
subsidiaries of UniSource Energy Services (UES) — are seasonal in nature. TEP and UNS Electric
typically record the majority of their net income during the second and third quarters, when hot
weather contributes to higher energy consumption. TEP’s retail prices, which include higher rates
for higher levels of energy use, also shift a larger share of the company’s earnings into those
periods.
Energy demand from UNS Gas customers typically peaks during the winter. Accordingly, UNS Gas
records the majority of its net income during the first and fourth quarters.
Tucson Electric Power
Retail kWh Sales and Revenues
TEP’s retail kWh sales fell 1.3 percent in the third quarter of 2011 compared with the same period
last year. Residential and commercial kWh sales were down 1.9 percent and 2.3 percent,
respectively, compared with the third quarter of 2010. Energy sales to industrial customers
increased 0.4 percent year over year, while sales volumes to mining customers remained essentially
flat.
Retail margin revenues decreased $4 million, or 1.9 percent, in the third quarter of 2011 compared
to the same period last year. These revenues do not include customer surcharges used to fund
renewable energy and energy efficiency programs or a $12 million increase in revenues that cover
fuel and purchased power costs.
Long-Term Wholesale Revenues
The margin on TEP’s long-term wholesale kWh sales fell by $5 million compared with the third
quarter of 2010. The decrease reflects the terms of TEP’s wholesale sales contract with Salt River
Project (SRP). Effective June 1, 2011, SRP no longer pays TEP a monthly demand charge
of approximately $2 million. Instead, SRP is required to purchase 73,000 MWh per month, or 876,000
MWh annually, at an energy price set at a discount to the Palo Verde Market Index.
2
Other Operating Expenses
TEP’s base operating and maintenance (O&M) expense increased by $2 million in the third quarter of
2011 compared with the same period last year. Base O&M excludes costs directly offset by customer
surcharges and third-party reimbursements.
Depreciation and amortization expense increased by $2 million in the third quarter of 2011 due
primarily to additional plant-in-service compared with the same period last year.
Year-to-Date Results
TEP reported net income of $83.8 million for the first nine months of 2011, compared with net
income of $98.1 million in the same period last year. That decrease was due to: a decline in
long-term wholesale margin revenues; a decrease in wholesale transmission revenues; an increase in
base O&M due to planned generating plant maintenance expense; higher depreciation expense; and an
increase in interest expense.
UNS Gas
UNS Gas reported a net loss of $1 million in the third quarters of both 2011 and 2010. For the
first nine months of 2011, UNS Gas reported net income of $6 million compared with $5 million in
the same period last year. The increase is due primarily to a rate increase that was effective in
April 2010.
UNS Electric
UNS Electric reported net income of $7 million in the third quarter of 2011 compared with $5
million in the third quarter of 2010. For the first nine months of 2011, UNS Electric reported net
income of $14 million compared with $12 million in the same period last year. The increase in net
income in both periods is due primarily to a rate increase that took effect in October 2010.
In July 2011, UNS Electric purchased the Black Mountain Generating Station (BMGS) from UniSource
Energy Development, a subsidiary of UniSource Energy. In accordance with accounting rules related
to the transfer of a business held under common control, we reflect UNS Electric’s purchase of BMGS
as if it occurred on January 1, 2009. The transaction increased UNS Electric’s net income by $2
million for the three months ended September 30, 2010, and had no impact on the three months ended
September 30, 2011. UNS Electric’s net income increased by $2 million for the nine months ended
September 30, 2011, and $4 million for the nine months ended September 30, 2010. The transaction
had no impact on UniSource Energy’s consolidated financial statements.
Millennium
Millennium recorded $1 million of net income in the third quarter of 2011 related to the sale of a
building. In the third quarter of 2010, Millennium recorded a $6 million loss due to $5 million of
income tax expense related to the write-off of deferred tax assets and a $1 million after-tax
impairment loss related to its investments.
In the first nine months of 2011, Millennium recorded net income of $2 million compared with a net
loss of $9 million in the same period last year. Millennium’s results in the first nine months of
2010 include the write-off of deferred tax assets and impairment losses related to its investments.
3
Net Income and Earnings Per Share Summary
| 3rd Quarter | YTD Sept. 30 | |||||||||||||||
| Net Income | 2011 | 2010 | 2011 | 2010 | ||||||||||||
| -Millions- | -Millions- | |||||||||||||||
Tucson Electric Power |
$ | 53.9 | $ | 59.7 | $ | 83.8 | $ | 98.1 | ||||||||
UNS Gas |
(0.7 | ) | (1.0 | ) | 5.8 | 5.3 | ||||||||||
UNS Electric |
7.0 | 4.6 | 14.4 | 12.1 | ||||||||||||
Other Non-Reportable Segments and Consolidating Adj. |
(0.5 | ) | (7.6 | ) | (2.2 | ) | (13.8 | ) | ||||||||
Net Income |
$ | 59.7 | $ | 55.7 | $ | 101.8 | $ | 101.7 | ||||||||
Avg. Basic Shares Outstanding (millions) |
37.1 | 36.5 | 36.9 | 36.3 | ||||||||||||
Avg. Diluted Shares Outstanding (millions) |
41.8 | 41.1 | 41.6 | 40.9 | ||||||||||||
| 3rd Quarter | YTD Sept. 30 | |||||||||||||||
| Earnings Per UniSource Energy Share | 2011 | 2010 | 2011 | 2010 | ||||||||||||
Tucson Electric Power |
$ | 1.45 | $ | 1.63 | $ | 2.27 | $ | 2.70 | ||||||||
UNS Gas |
(0.02 | ) | (0.03 | ) | 0.16 | 0.15 | ||||||||||
UNS Electric |
0.19 | 0.13 | 0.39 | 0.33 | ||||||||||||
Other Non-Reportable Segments and Consolidating Adj. |
(0.01 | ) | (0.21 | ) | (0.06 | ) | (0.38 | ) | ||||||||
Net Income per Basic Share |
$ | 1.61 | $ | 1.52 | $ | 2.76 | $ | 2.80 | ||||||||
Net Income per Diluted Share |
$ | 1.46 | $ | 1.38 | $ | 2.53 | $ | 2.57 | ||||||||
UniSource Energy believes the presentation of TEP, UNS Gas, UNS Electric and Other segment net
income or loss on a per basic UniSource Energy share basis, which are non-GAAP financial measures,
provides useful information to investors by disclosing the results of operations of its business
segments on a basis consistent with UniSource Energy’s reported earnings or losses.
Revision of Prior Period Financial Statements
During the first half of 2011, we identified errors related to prior periods in two categories: (i)
deliveries of electricity related to transmission agreements at TEP; and (ii) the calculation of
income tax expense as it relates to Allowance for Equity Funds Used During Construction (AFUDC). We
assessed the materiality of these errors on prior period financial statements and concluded that
while they were not material to any prior annual or interim periods, the cumulative impact could be
material to the annual period ending December 31, 2011, and the interim period ended June 30, 2011,
if included in 2011. As a result, in accordance with Staff Accounting Bulletin 108, we revised our
prior period financial statements in or Form 10-Q for the period ended June 30, 2011.
4
In the third quarter of 2011, following the review of our remaining agreements, we identified
additional errors in prior periods. We assessed the materiality of these errors, considered
together with the errors identified in the first half of 2011, on prior period financial statements
and concluded that, while they were not material to any prior annual or interim periods, we should
update the prior revision to reflect all of the errors identified in 2011. As a result, in
accordance with Staff Accounting Bulletin 108, we revised our prior period financial statements.
Please refer to UniSource Energy’s and TEP’s third quarter SEC form 10-Q, which is expected to be
filed on or before November 9, 2011, for more information.
Conference Call and Webcast
The company will host a conference call on October 31, 2011 at 12:00 p.m. EDT to discuss the
financial results and outlook. To participate in the call, please dial in 5 to 10 minutes prior to
the start time.
Dial-in number: (877) 582-0446
Reference code: 23291820
Reference code: 23291820
The conference call also can be heard live on UniSource Energy’s website. The webcast can be
accessed at uns.com and will be available for replay for seven days.
Replay number: (855) 859-2056
Reference code: 23291820
Reference code: 23291820
In conjunction with this earnings announcement, UniSource Energy has provided detailed information
on its performance during the third quarter of 2011. These materials have been filed with the
Securities and Exchange Commission and are also available at uns.com.
UniSource Energy is a Tucson, Arizona-based company with consolidated assets of approximately $3.9
billion. UniSource Energy’s primary subsidiaries include Tucson Electric Power, which serves more
than 403,000 customers in southern Arizona, and UniSource Energy Services, provider of natural gas
and electric service for about 237,000 customers in northern and southern Arizona. Visit uns.com
for more information about UniSource Energy and its subsidiaries.
This release contains forward-looking information that involves risks and uncertainties, including
factors that could affect UniSource Energy’s ability to reach the 2011 earnings guidance. These
factors include: state and federal regulatory and legislative decisions and actions, including
environmental legislation and renewable energy requirements; regional economic and market
conditions that could affect customer growth and energy usage; weather variations affecting energy
usage; the cost of debt and equity capital and access to capital markets; the performance of the
stock market and changing interest rate environment, which affect the value of the company’s
pension and other postretirement benefit plan assets and the related contribution requirements and
expense; unexpected increases in O&M expense; resolution of pending litigation matters; changes in
accounting standards; changes in critical accounting estimates; changes to long-term contracts; the
cost of fuel and energy supplies; performance of TEP’s generating plants; and other factors listed
in UniSource Energy’s Form 10-K and 10-Q filings with the Securities and Exchange Commission. The
preceding factors may cause future results to differ materially from outcomes currently expected by
UniSource Energy.
5
UNISOURCE ENERGY 2011 RESULTS
UniSource Energy Corporation
Condensed Consolidated Statements of Income
(in thousands of dollars, except per share amounts)
(UNAUDITED)
Condensed Consolidated Statements of Income
(in thousands of dollars, except per share amounts)
(UNAUDITED)
| Three Months Ended | ||||||||||||||||
| September 30, | Increase / (Decrease) | |||||||||||||||
| 2011 | 2010 | Amount | Percent | |||||||||||||
Operating Revenues |
||||||||||||||||
Electric Retail Sales |
$ | 363,385 | $ | 360,028 | $ | 3,357 | 0.9 | |||||||||
Electric Wholesale Sales |
41,847 | 36,838 | 5,009 | 13.6 | ||||||||||||
Gas Revenue |
16,831 | 16,140 | 691 | 4.3 | ||||||||||||
Other Revenues |
28,884 | 25,824 | 3,060 | 11.8 | ||||||||||||
Total Operating Revenues |
450,947 | 438,830 | 12,117 | 2.8 | ||||||||||||
Operating Expenses |
||||||||||||||||
Fuel |
98,962 | 89,874 | 9,088 | 10.1 | ||||||||||||
Purchased Energy |
88,734 | 93,889 | (5,155 | ) | (5.5 | ) | ||||||||||
Transmission |
(1,354 | ) | 3,380 | (4,734 | ) | N/M | ||||||||||
Decrease to Reflect PPFAC/PGA Recovery Treatment |
(3,576 | ) | (11,735 | ) | 8,159 | 69.5 | ||||||||||
Total Fuel and Purchased Energy |
182,766 | 175,408 | 7,358 | 4.2 | ||||||||||||
Other Operations and Maintenance |
90,781 | 88,936 | 1,845 | 2.1 | ||||||||||||
Depreciation |
33,553 | 32,450 | 1,103 | 3.4 | ||||||||||||
Amortization |
7,882 | 7,177 | 705 | 9.8 | ||||||||||||
Taxes Other Than Income Taxes |
12,205 | 11,334 | 871 | 7.7 | ||||||||||||
Total Operating Expenses |
327,187 | 315,305 | 11,882 | 3.8 | ||||||||||||
Operating Income |
123,760 | 123,525 | 235 | 0.2 | ||||||||||||
Other Income (Deductions) |
||||||||||||||||
Interest Income |
1,919 | 2,011 | (92 | ) | (4.6 | ) | ||||||||||
Other Income |
1,678 | 2,196 | (518 | ) | (23.6 | ) | ||||||||||
Other Expense |
(1,412 | ) | (2,456 | ) | 1,044 | 42.5 | ||||||||||
Total Other Income (Deductions) |
2,185 | 1,751 | 434 | 24.8 | ||||||||||||
Interest Expense |
||||||||||||||||
Long-Term Debt |
17,945 | 15,928 | 2,017 | 12.7 | ||||||||||||
Capital Leases |
10,248 | 11,616 | (1,368 | ) | (11.8 | ) | ||||||||||
Other Interest Expense, Net of Interest Capitalized |
(88 | ) | (1,726 | ) | 1,638 | 94.9 | ||||||||||
Total Interest Expense |
28,105 | 25,818 | 2,287 | 8.9 | ||||||||||||
Income Before Income Taxes |
97,840 | 99,458 | (1,618 | ) | (1.6 | ) | ||||||||||
Income Tax Expense |
38,128 | 43,793 | (5,665 | ) | (12.9 | ) | ||||||||||
Net Income |
$ | 59,712 | $ | 55,665 | $ | 4,047 | 7.3 | |||||||||
Weighted-Average Shares of Common Stock Outstanding (000) |
||||||||||||||||
Basic |
37,053 | 36,533 | 520 | 1.4 | ||||||||||||
Diluted |
41,777 | 41,141 | 636 | 1.5 | ||||||||||||
Earnings per Share |
||||||||||||||||
Basic |
$ | 1.61 | $ | 1.52 | $ | 0.09 | 5.9 | |||||||||
Diluted |
$ | 1.46 | $ | 1.38 | $ | 0.08 | 5.8 | |||||||||
Dividends Declared per Share |
$ | 0.42 | $ | 0.39 | $ | 0.03 | 7.7 | |||||||||
| N/M — Not Meaningful |
| Reclassifications have been made to prior periods to conform to the current period’s presentation. |
6
UNISOURCE ENERGY 2011 RESULTS
UniSource Energy Corporation
Condensed Consolidated Statements of Income
(in thousands of dollars, except per share amounts)
(UNAUDITED)
Condensed Consolidated Statements of Income
(in thousands of dollars, except per share amounts)
(UNAUDITED)
| Nine Months Ended | ||||||||||||||||
| September 30, | Increase / (Decrease) | |||||||||||||||
| 2011 | 2010 | Amount | Percent | |||||||||||||
Operating Revenues |
||||||||||||||||
Electric Retail Sales |
$ | 856,216 | $ | 824,714 | $ | 31,502 | 3.8 | |||||||||
Electric Wholesale Sales |
121,506 | 102,397 | 19,109 | 18.7 | ||||||||||||
California Power Exchange (CPX) Provision for Wholesale Refunds |
— | (2,970 | ) | 2,970 | N/M | |||||||||||
Gas Revenue |
99,041 | 96,598 | 2,443 | 2.5 | ||||||||||||
Other Revenues |
88,624 | 76,053 | 12,571 | 16.5 | ||||||||||||
Total Operating Revenues |
1,165,387 | 1,096,792 | 68,595 | 6.3 | ||||||||||||
Operating Expenses |
||||||||||||||||
Fuel |
252,103 | 219,192 | 32,911 | 15.0 | ||||||||||||
Purchased Energy |
233,344 | 243,285 | (9,941 | ) | (4.1 | ) | ||||||||||
Transmission |
4,612 | 8,688 | (4,076 | ) | (46.9 | ) | ||||||||||
Decrease to Reflect PPFAC/PGA Recovery Treatment |
(5,174 | ) | (34,260 | ) | 29,086 | 84.9 | ||||||||||
Total Fuel and Purchased Energy |
484,885 | 436,905 | 47,980 | 11.0 | ||||||||||||
Other Operations and Maintenance |
281,888 | 258,979 | 22,909 | 8.8 | ||||||||||||
Depreciation |
99,653 | 95,773 | 3,880 | 4.1 | ||||||||||||
Amortization |
22,513 | 20,797 | 1,716 | 8.3 | ||||||||||||
Taxes Other Than Income Taxes |
36,579 | 35,559 | 1,020 | 2.9 | ||||||||||||
Total Operating Expenses |
925,518 | 848,013 | 77,505 | 9.1 | ||||||||||||
Operating Income |
239,869 | 248,779 | (8,910 | ) | (3.6 | ) | ||||||||||
Other Income (Deductions) |
||||||||||||||||
Interest Income |
3,739 | 5,891 | (2,152 | ) | (36.5 | ) | ||||||||||
Other Income |
7,155 | 9,334 | (2,179 | ) | (23.3 | ) | ||||||||||
Other Expense |
(2,830 | ) | (9,359 | ) | 6,529 | 69.8 | ||||||||||
Total Other Income (Deductions) |
8,064 | 5,866 | 2,198 | 37.5 | ||||||||||||
Interest Expense |
||||||||||||||||
Long-Term Debt |
54,240 | 46,984 | 7,256 | 15.4 | ||||||||||||
Capital Leases |
30,108 | 35,124 | (5,016 | ) | (14.3 | ) | ||||||||||
Other Interest Expense, Net of Interest Capitalized |
(1,118 | ) | (1,213 | ) | 95 | 7.8 | ||||||||||
Total Interest Expense |
83,230 | 80,895 | 2,335 | 2.9 | ||||||||||||
Income Before Income Taxes |
164,703 | 173,750 | (9,047 | ) | (5.2 | ) | ||||||||||
Income Tax Expense |
62,916 | 72,018 | (9,102 | ) | (12.6 | ) | ||||||||||
Net Income |
$ | 101,787 | $ | 101,732 | $ | 55 | 0.1 | |||||||||
Weighted-Average Shares of Common Stock Outstanding (000) |
||||||||||||||||
Basic |
36,930 | 36,321 | 609 | 1.7 | ||||||||||||
Diluted |
41,577 | 40,923 | 654 | 1.6 | ||||||||||||
Earnings per Share |
||||||||||||||||
Basic |
$ | 2.76 | $ | 2.80 | $ | (0.04 | ) | (1.4 | ) | |||||||
Diluted |
$ | 2.53 | $ | 2.57 | $ | (0.04 | ) | (1.6 | ) | |||||||
Dividends Declared per Share |
$ | 1.26 | $ | 1.17 | $ | 0.09 | 7.7 | |||||||||
| N/M — Not Meaningful |
| Reclassifications have been made to prior periods to conform to the current period’s presentation. |
7
TUCSON ELECTRIC POWER COMPANY 2011 RESULTS
TUCSON ELECTRIC POWER COMPANY
Condensed Consolidated Statements of Income
(in thousands of dollars)
(UNAUDITED)
Condensed Consolidated Statements of Income
(in thousands of dollars)
(UNAUDITED)
| Three Months Ended | ||||||||||||||||
| September 30, | Increase / (Decrease) | |||||||||||||||
| 2011 | 2010 | Amount | Percent | |||||||||||||
Operating Revenues |
||||||||||||||||
Electric Retail Sales |
$ | 308,924 | $ | 300,348 | $ | 8,576 | 2.9 | |||||||||
Electric Wholesale Sales |
29,608 | 26,731 | 2,877 | 10.8 | ||||||||||||
Other Revenues |
31,313 | 27,559 | 3,754 | 13.6 | ||||||||||||
Total Operating Revenues |
369,845 | 354,638 | 15,207 | 4.3 | ||||||||||||
Operating Expenses |
||||||||||||||||
Fuel |
95,977 | 85,174 | 10,803 | 12.7 | ||||||||||||
Purchased Power |
40,509 | 47,909 | (7,400 | ) | (15.4 | ) | ||||||||||
Transmission |
(4,266 | ) | 972 | (5,238 | ) | N/M | ||||||||||
Increase (Decrease) to Reflect PPFAC Recovery Treatment |
1,115 | (12,724 | ) | 13,839 | N/M | |||||||||||
Total Fuel and Purchased Energy |
133,335 | 121,331 | 12,004 | 9.9 | ||||||||||||
Other Operations and Maintenance |
79,837 | 74,687 | 5,150 | 6.9 | ||||||||||||
Depreciation |
26,541 | 25,190 | 1,351 | 5.4 | ||||||||||||
Amortization |
8,798 | 8,153 | 645 | 7.9 | ||||||||||||
Taxes Other Than Income Taxes |
9,855 | 9,222 | 633 | 6.9 | ||||||||||||
Total Operating Expenses |
258,366 | 238,583 | 19,783 | 8.3 | ||||||||||||
Operating Income |
111,479 | 116,055 | (4,576 | ) | (3.9 | ) | ||||||||||
Other Income (Deductions) |
||||||||||||||||
Interest Income |
1,666 | 1,725 | (59 | ) | (3.4 | ) | ||||||||||
Other Income |
229 | 2,018 | (1,789 | ) | (88.7 | ) | ||||||||||
Other Expense |
(2,754 | ) | (2,468 | ) | (286 | ) | (11.6 | ) | ||||||||
Total Other Income (Deductions) |
(859 | ) | 1,275 | (2,134 | ) | N/M | ||||||||||
Interest Expense |
||||||||||||||||
Long-Term Debt |
12,081 | 10,223 | 1,858 | 18.2 | ||||||||||||
Capital Leases |
10,248 | 11,614 | (1,366 | ) | (11.8 | ) | ||||||||||
Other Interest Expense, Net of Interest Capitalized |
(44 | ) | (1,683 | ) | 1,639 | 97.4 | ||||||||||
Total Interest Expense |
22,285 | 20,154 | 2,131 | 10.6 | ||||||||||||
Income Before Income Taxes |
88,335 | 97,176 | (8,841 | ) | (9.1 | ) | ||||||||||
Income Tax Expense |
34,423 | 37,472 | (3,049 | ) | (8.1 | ) | ||||||||||
Net Income |
$ | 53,912 | $ | 59,704 | $ | (5,792 | ) | (9.7 | ) | |||||||
Electric MWh Sales: |
||||||||||||||||
Retail Sales |
2,985,792 | 3,026,232 | (40,440 | ) | (1.3 | ) | ||||||||||
Long-Term Wholesale Sales |
230,611 | 223,728 | 6,883 | 3.1 | ||||||||||||
| N/M — Not Meaningful |
| Reclassifications have been made to prior periods to conform to the current period’s presentation. |
8
TUCSON ELECTRIC POWER COMPANY 2011 RESULTS
TUCSON ELECTRIC POWER COMPANY
Condensed Consolidated Statements of Income
(in thousands of dollars)
(UNAUDITED)
Condensed Consolidated Statements of Income
(in thousands of dollars)
(UNAUDITED)
| Nine Months Ended | ||||||||||||||||
| September 30, | Increase / (Decrease) | |||||||||||||||
| 2011 | 2010 | Amount | Percent | |||||||||||||
Operating Revenues |
||||||||||||||||
Electric Retail Sales |
$ | 714,278 | $ | 685,322 | $ | 28,956 | 4.2 | |||||||||
Electric Wholesale Sales |
96,623 | 96,997 | (374 | ) | (0.4 | ) | ||||||||||
California Power Exchange (CPX) Provision for Wholesale Refunds |
— | (2,970 | ) | 2,970 | N/M | |||||||||||
Other Revenues |
93,765 | 81,066 | 12,699 | 15.7 | ||||||||||||
Total Operating Revenues |
904,666 | 860,415 | 44,251 | 5.1 | ||||||||||||
Operating Expenses |
||||||||||||||||
Fuel |
246,563 | 209,843 | 36,720 | 17.5 | ||||||||||||
Purchased Power |
84,189 | 105,900 | (21,711 | ) | (20.5 | ) | ||||||||||
Transmission |
(2,339 | ) | 2,818 | (5,157 | ) | N/M | ||||||||||
Decrease to Reflect PPFAC Recovery Treatment |
(5,146 | ) | (23,023 | ) | 17,877 | 77.6 | ||||||||||
Total Fuel and Purchased Energy |
323,267 | 295,538 | 27,729 | 9.4 | ||||||||||||
Other Operations and Maintenance |
246,423 | 219,664 | 26,759 | 12.2 | ||||||||||||
Depreciation |
78,124 | 74,143 | 3,981 | 5.4 | ||||||||||||
Amortization |
25,282 | 23,963 | 1,319 | 5.5 | ||||||||||||
Taxes Other Than Income Taxes |
29,803 | 28,903 | 900 | 3.1 | ||||||||||||
Total Operating Expenses |
702,899 | 642,211 | 60,688 | 9.4 | ||||||||||||
Operating Income |
201,767 | 218,204 | (16,437 | ) | (7.5 | ) | ||||||||||
Other Income (Deductions) |
||||||||||||||||
Interest Income |
2,983 | 5,111 | (2,128 | ) | (41.6 | ) | ||||||||||
Other Income |
4,597 | 4,351 | 246 | 5.7 | ||||||||||||
Other Expense |
(7,751 | ) | (7,352 | ) | (399 | ) | (5.4 | ) | ||||||||
Total Other Income (Deductions) |
(171 | ) | 2,110 | (2,281 | ) | N/M | ||||||||||
Interest Expense |
||||||||||||||||
Long-Term Debt |
36,493 | 30,255 | 6,238 | 20.6 | ||||||||||||
Capital Leases |
30,107 | 35,118 | (5,011 | ) | (14.3 | ) | ||||||||||
Other Interest Expense, Net of Interest Capitalized |
(881 | ) | (1,641 | ) | 760 | 46.3 | ||||||||||
Total Interest Expense |
65,719 | 63,732 | 1,987 | 3.1 | ||||||||||||
Income Before Income Taxes |
135,877 | 156,582 | (20,705 | ) | (13.2 | ) | ||||||||||
Income Tax Expense |
52,104 | 58,447 | (6,343 | ) | (10.9 | ) | ||||||||||
Net Income |
$ | 83,773 | $ | 98,135 | $ | (14,362 | ) | (14.6 | ) | |||||||
Electric MWh Sales: |
||||||||||||||||
Retail Sales |
7,272,091 | 7,249,048 | 23,043 | 0.3 | ||||||||||||
Long-Term Wholesale Sales |
668,995 | 727,470 | (58,475 | ) | (8.0 | ) | ||||||||||
| N/M — Not Meaningful |
| Reclassifications have been made to prior periods to conform to the current period’s presentation. |
9
