| Summary of operating results by line of business |
QEP's lines of business include natural gas and oil exploration and production (QEP Energy), midstream field services (QEP Field Services) and marketing (QEP Marketing and other). The lines of business are managed separately and therefore the financial information is presented separately due to the distinct differences in the nature of operations of each line of business, among other factors.
The following table is a summary of operating results for the year ended December 31, 2012, by line of business: | | | | | | | | | | | | | | | | | | | | | | QEP Energy | | QEP Field Services | | QEP Marketing & Other | | Eliminations | | QEP Consolidated |
| (in millions) | Revenues (1) | | | | | | | | | | From unaffiliated customers | $ | 1,615.4 |
| | $ | 320.2 |
| | $ | 414.2 |
| | $ | — |
| | $ | 2,349.8 |
| From affiliated customers | — |
| | 119.0 |
| | 605.7 |
| | (724.7 | ) | | — |
| Total Revenues | 1,615.4 |
| | 439.2 |
| | 1,019.9 |
| | (724.7 | ) | | 2,349.8 |
| Operating expenses | |
| | |
| | |
| | |
| | |
| Purchased gas, oil and NGL expense | 224.7 |
| | 12.1 |
| | 1,021.1 |
| | (602.3 | ) | | 655.6 |
| Lease operating expense | 175.8 |
| | — |
| | — |
| | (3.5 | ) | | 172.3 |
| Natural gas, oil and NGL transportation and other handling costs | 228.1 |
| | 33.6 |
| | — |
| | (112.8 | ) | | 148.9 |
| Gathering, processing and other | — |
| | 86.8 |
| | 1.2 |
| | — |
| | 88.0 |
| General and administrative | 237.6 |
| | 34.7 |
| | 0.4 |
| | (6.1 | ) | | 266.6 |
| Production and property taxes | 97.2 |
| | 6.0 |
| | 0.2 |
| | — |
| | 103.4 |
| Depreciation, depletion and amortization | 838.0 |
| | 63.2 |
| | 3.7 |
| | — |
| | 904.9 |
| Abandonment, impairment and exploration expenses | 144.6 |
| | — |
| | — |
| | — |
| | 144.6 |
| Total operating expenses | 1,946.0 |
| | 236.4 |
| | 1,026.6 |
| | (724.7 | ) | | 2,484.3 |
| Net gain from asset sales | 1.2 |
| | — |
| | — |
| | — |
| | 1.2 |
| Operating (loss) income (1) | (329.4 | ) | | 202.8 |
| | (6.7 | ) | | — |
| | (133.3 | ) | Realized and unrealized gains (losses) on derivative contracts | 434.9 |
| | 8.4 |
| | (1.4 | ) | | — |
| | 441.9 |
| Interest and other income | 6.2 |
| | 0.2 |
| | 132.1 |
| | (131.9 | ) | | 6.6 |
| Income from unconsolidated affiliates | 0.1 |
| | 6.7 |
| | — |
| | — |
| | 6.8 |
| Loss on early extinguishment of debt | — |
| | — |
| | (0.6 | ) | | — |
| | (0.6 | ) | Interest expense | (116.8 | ) | | (13.6 | ) | | (124.4 | ) | | 131.9 |
| | (122.9 | ) | Income (loss) before income taxes | (5.0 | ) | | 204.5 |
| | (1.0 | ) | | — |
| | 198.5 |
| Income tax (provision) benefit | 4.3 |
| | (71.8 | ) | | 1.0 |
| | — |
| | (66.5 | ) | Net income (loss) | (0.7 | ) | | 132.7 |
| | — |
| | — |
| | 132.0 |
| Net income attributable to noncontrolling interest | — |
| | (3.7 | ) | | — |
| | — |
| | (3.7 | ) | Net income (loss) attributable to QEP (2) | $ | (0.7 | ) | | $ | 129.0 |
| | $ | — |
| | $ | — |
| | $ | 128.3 |
| Identifiable total assets | $ | 7,436.5 |
| | $ | 1,399.7 |
| | $ | 272.3 |
| | $ | — |
| | $ | 9,108.5 |
| Investment in unconsolidated affiliates | — |
| | 41.2 |
| | — |
| | — |
| | 41.2 |
| Cash capital expenditures | 2,621.1 |
| | 164.0 |
| | 14.6 |
| | — |
| | 2,799.7 |
| Accrued capital expenditures | 2,702.4 |
| | 171.2 |
| | 14.6 |
| | — |
| | 2,888.2 |
| Goodwill | 59.5 |
| | — |
| | — |
| | — |
| | 59.5 |
|
____________________________ | | (1) | The impact of QEP's settled derivative contracts, for the year ended December 31, 2012, are reflected below operating (loss) income. |
| | (2) | Net (loss) income attributable to QEP for the year ended December 31, 2012, includes the impact of unrealized gains and losses from changes in the fair value of the commodity derivative contracts. |
The following table is a summary of operating results for the year ended December 31, 2011, by line of business: | | | | | | | | | | | | | | | | | | | | | | QEP Energy | | QEP Field Services | | QEP Marketing & Other | | Eliminations | | QEP Consolidated |
| (in millions) | Revenues (1) | | | | | | | | | | From unaffiliated customers | $ | 2,213.2 |
| | $ | 369.3 |
| | $ | 576.7 |
| | $ | — |
| | $ | 3,159.2 |
| From affiliated customers | — |
| | 96.2 |
| | 580.2 |
| | (676.4 | ) | | — |
| Total Revenues | 2,213.2 |
| | 465.5 |
| | 1,156.9 |
| | (676.4 | ) | | 3,159.2 |
| Operating expenses | |
| | |
| | |
| | |
| | |
| Purchased gas, oil and NGL expense | 506.4 |
| | — |
| | 1,144.5 |
| | (573.8 | ) | | 1,077.1 |
| Lease operating expense | 148.2 |
| | — |
| | — |
| | (3.0 | ) | | 145.2 |
| Natural gas, oil and NGL transportation and other handling costs | 186.0 |
| | 9.3 |
| | — |
| | (93.1 | ) | | 102.2 |
| Gathering, processing and other | — |
| | 106.0 |
| | 1.3 |
| | — |
| | 107.3 |
| General and administrative | 98.4 |
| | 29.2 |
| | 2.1 |
| | (6.5 | ) | | 123.2 |
| Production and property taxes | 99.1 |
| | 6.1 |
| | 0.2 |
| | — |
| | 105.4 |
| Depreciation, depletion and amortization | 707.2 |
| | 55.7 |
| | 2.5 |
| | — |
| | 765.4 |
| Abandonment, impairment and exploration expenses | 228.9 |
| | — |
| | — |
| | — |
| | 228.9 |
| Total operating expenses | 1,974.2 |
| | 206.3 |
| | 1,150.6 |
| | (676.4 | ) | | 2,654.7 |
| Net gain (loss) from asset sales | 1.4 |
| | — |
| | — |
| | — |
| | 1.4 |
| Operating income (2) | 240.4 |
| | 259.2 |
| | 6.3 |
| | — |
| | 505.9 |
| Interest and other income | 4.0 |
| | 0.1 |
| | 98.7 |
| | (98.7 | ) | | 4.1 |
| Income from unconsolidated affiliates | 0.1 |
| | 5.4 |
| | — |
| | — |
| | 5.5 |
| Loss on extinguishment of debt | — |
| | — |
| | (0.7 | ) | | — |
| | (0.7 | ) | Interest expense | (81.9 | ) | | (13.6 | ) | | (93.2 | ) | | 98.7 |
| | (90.0 | ) | Income before income taxes | 162.6 |
| | 251.1 |
| | 11.1 |
| | — |
| | 424.8 |
| Income taxes | (57.9 | ) | | (93.4 | ) | | (3.1 | ) | | — |
| | (154.4 | ) | Net income | 104.7 |
| | 157.7 |
| | 8.0 |
| | — |
| | 270.4 |
| Net income attributable to noncontrolling interest | — |
| | (3.2 | ) | | — |
| | — |
| | (3.2 | ) | Net income attributable to QEP (3) | $ | 104.7 |
| | $ | 154.5 |
| | $ | 8.0 |
| | $ | — |
| | $ | 267.2 |
| Identifiable assets | $ | 5,815.7 |
| | $ | 1,312.7 |
| | $ | 314.3 |
| | $ | — |
| | $ | 7,442.7 |
| Investment in unconsolidated affiliates | — |
| | 42.2 |
| | — |
| | — |
| | 42.2 |
| Cash capital expenditures | 1,295.5 |
| | 130.1 |
| | 5.5 |
| | — |
| | 1,431.1 |
| Accrued capital expenditures | 1,338.7 |
| | 101.6 |
| | 5.5 |
| | — |
| | 1,445.8 |
| Goodwill | 59.5 |
| | — |
| | — |
| | — |
| | 59.5 |
|
____________________________ | | (1) | Revenues for the year ended December 31, 2011, reflect the impact of QEP's settled derivative contracts. See Note 6 - Derivative Contracts, for additional information on derivative contract settlements in the year ended December 31, 2011. |
| | (2) | Under hedge accounting, realized gains and losses from realized commodity derivative contract settlements were included in revenues and operating income during the year ended December 31, 2011. |
| | (3) | Under hedge accounting, unrealized gains and losses from changes in the fair value were deferred in AOCI during the year ended December 31, 2011. |
The following table is a summary of operating results for the year ended December 31, 2010, by line of business: | | | | | | | | | | | | | | | | | | | | | | QEP Energy | | QEP Field Services | | QEP Marketing & Other | | Eliminations | | QEP Consolidated |
| (in millions) | Revenues (1) | | | | | | | | | | From unaffiliated customers | $ | 1,456.3 |
| | $ | 245.5 |
| | $ | 598.8 |
| | $ | — |
| | $ | 2,300.6 |
| From affiliated customers | — |
| | 73.7 |
| | 499.7 |
| | (573.4 | ) | | — |
| Total Revenues | 1,456.3 |
| | 319.2 |
| | 1,098.5 |
| | (573.4 | ) | | 2,300.6 |
| Operating expenses | |
| | |
| | |
| | |
| | |
| Purchased gas, oil and NGL expense | — |
| | — |
| | 1,082.8 |
| | (493.5 | ) | | 589.3 |
| Lease operating expense | 127.3 |
| | — |
| | — |
| | (2.3 | ) | | 125.0 |
| Natural gas, oil and NGL transportation and other handling costs | 125.5 |
| | — |
| | — |
| | (71.3 | ) | | 54.2 |
| Gathering, processing and other | — |
| | 82.1 |
| | 1.1 |
| | — |
| | 83.2 |
| General and administrative | 78.0 |
| | 31.6 |
| | 3.9 |
| | (6.3 | ) | | 107.2 |
| Separation costs | — |
| | — |
| | 13.5 |
| | — |
| | 13.5 |
| Production and property taxes | 77.8 |
| | 4.4 |
| | 0.3 |
| | — |
| | 82.5 |
| Depreciation, depletion and amortization | 592.5 |
| | 48.9 |
| | 2.0 |
| | — |
| | 643.4 |
| Abandonment, impairment and exploration expenses | 69.1 |
| | — |
| | — |
| | — |
| | 69.1 |
| Total operating expenses | 1,070.2 |
| | 167.0 |
| | 1,103.6 |
| | (573.4 | ) | | 1,767.4 |
| Net gain (loss) from asset sales | 13.7 |
| | (1.6 | ) | | — |
| | — |
| | 12.1 |
| Operating income (2) | 399.8 |
| | 150.6 |
| | (5.1 | ) | | — |
| | 545.3 |
| Interest and other income | 2.1 |
| | 0.1 |
| | 87.2 |
| | (87.1 | ) | | 2.3 |
| Income from unconsolidated affiliates | 0.2 |
| | 2.8 |
| | — |
| | — |
| | 3.0 |
| Loss on extinguishment of debt | — |
| | — |
| | (13.3 | ) | | — |
| | (13.3 | ) | Interest expense | (78.5 | ) | | (7.6 | ) | | (85.4 | ) | | 87.1 |
| | (84.4 | ) | Income before income taxes | 323.6 |
| | 145.9 |
| | (16.6 | ) | | — |
| | 452.9 |
| Income taxes | (119.7 | ) | | (51.9 | ) | | 4.6 |
| | — |
| | (167.0 | ) | Net income from continuing operations | 203.9 |
| | 94.0 |
| | (12.0 | ) | | — |
| | 285.9 |
| Discontinued operations, net of income tax | — |
| | — |
| | 43.2 |
| | — |
| | 43.2 |
| Net Income | 203.9 |
| | 94.0 |
| | 31.2 |
| | — |
| | 329.1 |
| Net income attributable to noncontrolling interest | — |
| | (2.9 | ) | | — |
| | — |
| | (2.9 | ) | Net income attributable to QEP (3) | $ | 203.9 |
| | $ | 91.1 |
| | $ | 31.2 |
| | $ | — |
| | $ | 326.2 |
| Identifiable assets | $ | 5,391.9 |
| | $ | 1,197.5 |
| | $ | 195.9 |
| | $ | — |
| | $ | 6,785.3 |
| Investment in unconsolidated affiliates | — |
| | 44.5 |
| | — |
| | — |
| | 44.5 |
| Cash capital expenditures | 1,205.0 |
| | 262.1 |
| | 1.9 |
| | — |
| | 1,469.0 |
| Accrued capital expenditures | 1,215.8 |
| | 268.2 |
| | 1.9 |
| | — |
| | 1,485.9 |
| Goodwill | 59.6 |
| | — |
| | — |
| | — |
| | 59.6 |
|
____________________________ | | (1) | Revenues for the year ended December 31, 2010, reflect the impact of QEP's settled derivative contracts. See Note 6 - Derivative Contracts, for detailed information on derivative contract settlements in the year ended December 31, 2010. |
| | (2) | Under hedge accounting, realized gains and losses from realized commodity derivative contract settlements were included in revenues and operating income during the year ended December 31, 2010. |
| | (3) | Under hedge accounting, unrealized gains and losses from changes in the fair value were deferred in AOCI during the year ended December 31, 2010. |
|