EX-99.1 2 d471818dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO   

For more information contact        

Media:

Leticia Lowe

Phone 713.207.7702

Investors:

Dave Mordy

Phone 713.207.6500

For Immediate Release

 

CenterPoint Energy reports third quarter 2017 earnings of $0.39 per

diluted share; $0.38 per diluted share on a guidance basis

 

  •   CenterPoint Energy anticipates achieving at or near the high end of the $1.25 - $1.33 guidance range for 2017

 

  •   Company continues to target upper end of 4-6% year-over-year earnings growth range for 2018

Houston - Nov. 3, 2017 - CenterPoint Energy, Inc. (NYSE: CNP) today reported net income of $169 million, or $0.39 per diluted share, for the third quarter of 2017, compared with net income of $179 million, or $0.41 per diluted share for the same period of the prior year. On a guidance basis, third quarter 2017 earnings were $0.38 per diluted share, consisting of $0.28 from utility operations and $0.10 from midstream investments. Third quarter 2016 earnings on a guidance basis were $0.41 per diluted share, consisting of $0.31 from utility operations and $0.10 from midstream investments.

Operating income for the third quarter of 2017 was $279 million, compared with $284 million in the third quarter of the prior year. Equity income from midstream investments was $68 million for the third quarter of 2017, compared with $73 million for the third quarter of the prior year.

“We had a solid third quarter, putting us on track to deliver at or near the high end of our full year guidance range,” said Scott M. Prochazka, president and chief executive officer of CenterPoint Energy. “Our ongoing focus on reliability and resilience enabled our system to perform well in the face of Hurricane Harvey.”

Business Segments

Electric Transmission & Distribution

The electric transmission & distribution segment reported operating income of $247 million for the third quarter of 2017, consisting of $229 million from the regulated electric transmission & distribution utility operations (TDU) and $18 million related to securitization bonds. Operating income for the third quarter of 2016 was $257 million, consisting of $234 million from the TDU and $23 million related to securitization bonds.

Operating income for the TDU benefited primarily from rate relief and customer growth. These benefits were more than offset by lower usage largely due to a return to more normal weather, lower equity return and lower miscellaneous revenues, including right of way.

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Natural Gas Distribution

The natural gas distribution segment reported operating income of $19 million for the third quarter of 2017, compared with $22 million for the same period of 2016. Operating income benefited primarily from rate relief and customer growth. These benefits were more than offset by higher depreciation and amortization expense, lower usage primarily due to the timing of a decoupling normalization adjustment and higher operations and maintenance expenses.

Energy Services

The energy services segment reported operating income of $7 million for the third quarter of 2017, which included a mark-to-market gain of $2 million. In comparison, operating income for the same period in 2016 was $5 million, which included a mark-to-market loss of $2 million. Excluding mark-to-market adjustments, operating income was $5 million for the third quarter of 2017 compared with $7 million for the same period in 2016. The $2 million decrease in operating income was primarily due to expenses related to the acquisition and integration of Atmos Energy Marketing.

Midstream Investments

The midstream investments segment reported $68 million of equity income for the third quarter of 2017, compared with $73 million in the third quarter of the prior year.

Earnings Outlook

On a consolidated basis, CenterPoint Energy anticipates earnings at or near the high end of its 2017 guidance range of $1.25 - $1.33 per diluted share.

The utility operations guidance range considers performance to date and certain 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 uses a non-GAAP measure of adjusted diluted earnings per share that does not consider other potential impacts, such as changes in accounting standards or unusual items, earnings or losses from the change in the value of the ZENS securities and the related stocks, or the timing effects of mark-to-market accounting in the company’s Energy Services business.

In providing guidance for midstream investments, the company assumes ownership of 54.1 percent of the common units representing limited partner interests in Enable Midstream and includes the amortization of CenterPoint Energy’s basis differential in Enable Midstream. CenterPoint Energy’s guidance takes into account such factors as Enable Midstream’s most recent public outlook for 2017 dated Nov. 1, 2017, and effective tax rates. The company does not include other potential impacts, such as any changes in accounting standards or Enable Midstream’s unusual items.

 

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     Quarter Ended  
     September 30, 2017      September 30, 2016  
     Net Income
(in millions)		      Diluted EPS      Net Income
(in millions)		      Diluted EPS  

Consolidated net income and diluted EPS as reported

    $ 169      $ 0.39      $ 179      $ 0.41  

Midstream Investments

      (42 )       (0.10 )       (46 )       (0.10 ) 
  

 

 

     

 

 

     

 

 

     

 

 

  

Utility Operations (1)

      127        0.29        133        0.31  
  

 

 

     

 

 

     

 

 

     

 

 

  

Timing effects impacting CES(2):

            

Mark-to-market (gains) losses (net of taxes of $1 and $1)(3)

      (1 )       —          1        —    

ZENS-related mark-to-market (gains) losses:

            

Marketable securities (net of taxes of $13 and $27) (3)(4)

      (24 )       (0.06 )       (50 )       (0.11 ) 

Indexed debt securities (net of taxes of $13 and $25) (3)

      23        0.05        47        0.11  
  

 

 

     

 

 

     

 

 

     

 

 

  

Utility operations earnings on an adjusted guidance basis

    $ 125      $ 0.28      $ 131      $ 0.31  
  

 

 

     

 

 

     

 

 

     

 

 

  

Adjusted net income and adjusted diluted EPS used in providing earnings guidance:

            

Utility Operations on a guidance basis

    $ 125      $ 0.28      $ 131      $ 0.31  

Midstream Investments

      42        0.10        46        0.10  
  

 

 

     

 

 

     

 

 

     

 

 

  

Consolidated on a guidance basis

    $ 167      $ 0.38      $ 177      $ 0.41  
  

 

 

     

 

 

     

 

 

     

 

 

  

 

(1)       CenterPoint earnings excluding Midstream Investments

(2)       Energy Services segment

(3)       Taxes are computed based on the impact removing such item would have on tax expense

(4)       Time Warner Inc., Charter Communications, Inc. and Time Inc.

 

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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 Sept. 30, 2017. 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 certain documents relating to its corporate governance can also be found under the Investors section.

Webcast of Earnings Conference Call

CenterPoint Energy’s management will host an earnings conference call on Friday, Nov. 3, 2017, at 10:00 a.m. Central time/11:00 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 54.1 percent of the common units representing limited partner interests 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 150 years. For more information, please visit 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. You are cautioned not to place undue reliance on any forward-looking statements. 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 earnings, and future financial performance and results of operations, including, but not limited to earnings guidance, targeted dividend growth rate 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) the performance of Enable Midstream Partners, LP (Enable), the amount of cash distributions CenterPoint Energy receives from Enable, Enable’s ability to redeem the Series A Preferred Units in certain circumstances and the value of CenterPoint Energy’s interest in Enable, and factors that may have a material impact on such performance, cash distributions and value, including factors such as: (A) 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; (B) the timing and extent of changes in the supply of natural gas and associated commodity prices, particularly prices of natural gas and natural gas liquids (NGLs), 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; (C) the demand for crude oil, natural gas, NGLs and transportation and storage services; (D) environmental and other governmental regulations, including the availability of drilling permits and the regulation of hydraulic fracturing; (E) recording of non-cash goodwill, long-lived asset or other than temporary impairment charges by or related to Enable; (F) changes in tax status; (G) access to debt and equity capital; and (H) the availability and prices of raw materials and services for current and future construction projects; (2) 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; (3) timely and appropriate rate actions that allow recovery of costs and a reasonable return on investment; (4) future economic conditions in regional and national markets and their effect on sales, prices and costs; (5) weather variations and other natural phenomena, including the impact of severe weather events on operations and capital; (6) state and federal legislative and regulatory actions or developments affecting various aspects of CenterPoint Energy’s and Enable’s businesses, including, among others, energy deregulation or re-regulation,

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pipeline integrity and safety and changes in regulation and legislation pertaining to trade, health care, finance and actions regarding the rates charged by our regulated businesses; (7) tax reform and legislation; (8) CenterPoint Energy’s ability to mitigate weather impacts through normalization or rate mechanisms, and the effectiveness of such mechanisms; (9) the timing and extent of changes in commodity prices, particularly natural gas, and the effects of geographic and seasonal commodity price differentials; (10) problems with regulatory approval, 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; (11) local, state and federal legislative and regulatory actions or developments relating to the environment, including those related to global climate change; (12) the impact of unplanned facility outages; (13) 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 CenterPoint Energy’s businesses or the businesses of third parties, or other catastrophic events such as fires, earthquakes, explosions, leaks, floods, droughts, hurricanes, pandemic health events or other occurrences; (14) CenterPoint Energy’s ability to invest planned capital and the timely recovery of CenterPoint Energy’s investment in capital; (15) CenterPoint Energy’s ability to control operation and maintenance costs; (16) actions by credit rating agencies; (17) the sufficiency of CenterPoint Energy’s insurance coverage, including availability, cost, coverage and terms; (18) the investment performance of CenterPoint Energy’s pension and postretirement benefit plans; (19) commercial bank and financial market conditions, CenterPoint Energy’s access to capital, the cost of such capital, and the results of CenterPoint Energy’s financing and refinancing efforts, including availability of funds in the debt capital markets; (20) changes in interest rates or rates of inflation; (21) inability of various counterparties to meet their obligations to CenterPoint Energy; (22) non-payment for CenterPoint Energy’s services due to financial distress of its customers; (23) the extent and effectiveness of CenterPoint Energy’s risk management and hedging activities, including, but not limited to, its financial hedges and weather hedges; (24) timely and appropriate regulatory actions allowing securitization or other recovery of costs associated with Hurricane Harvey and any future hurricanes or natural disasters; (25) CenterPoint Energy’s or Enable’s potential business strategies and strategic initiatives, including restructurings, joint ventures and acquisitions or dispositions of assets or businesses (including a reduction of CenterPoint Energy’s interests in Enable, whether through its election to sell the common units it owns in the public equity markets or otherwise, subject to certain limitations), which CenterPoint Energy cannot assure will be completed or will have the anticipated benefits to it or Enable; (26) acquisition and merger activities involving CenterPoint Energy or its competitors; (27) CenterPoint Energy’s or Enable’s ability to recruit, effectively transition and retain management and key employees and maintain good labor relations; (28) the ability of GenOn Energy, Inc. (formerly known as RRI Energy, Inc., Reliant Energy and RRI), a wholly-owned subsidiary of NRG Energy, Inc. (NRG), and its subsidiaries, currently the subject of bankruptcy proceedings, to satisfy their obligations to CenterPoint Energy, including indemnity obligations; (29) the outcome of litigation; (30) the ability of retail electric providers (REPs), including REP affiliates of NRG and Vistra Energy Corp., formerly known as TCEH Corp., to satisfy their obligations to CenterPoint Energy and its subsidiaries; (31) changes in technology, particularly with respect to efficient battery storage or the emergence or growth of new, developing or alternative sources of generation; (32) the timing and outcome of any audits, disputes and other proceedings related to taxes; (33) the effective tax rates; (34) the effect of changes in and application of accounting standards and pronouncements; and (35) other factors discussed in CenterPoint Energy’s Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2016, as well as in CenterPoint Energy’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2017, June 30, 2017 and September 30, 2017 and other reports CenterPoint Energy or its subsidiaries may file from time to time with the Securities and Exchange Commission.

Use of Non-GAAP Financial Measures by CenterPoint Energy in Providing Guidance

In addition to presenting its financial results in accordance with generally accepted accounting principles (GAAP), including presentation of net income and diluted earnings per share, CenterPoint Energy also provides guidance based on adjusted net income and adjusted diluted earnings per share, which are non-GAAP financial measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s historical or future financial performance that excludes or includes amounts that are not normally excluded or included in the most directly comparable GAAP financial measure. CenterPoint Energy’s adjusted net income and adjusted diluted earnings per share calculation excludes from net income and diluted earnings per share, respectively, the impact of ZENS and related securities and mark-to-market gains or losses resulting from the company’s Energy Services business. CenterPoint Energy is unable to present a quantitative reconciliation of forward looking adjusted net income and adjusted diluted earnings per share because changes in the value of ZENS and related securities and mark-to-market gains or losses resulting from the company’s Energy Services business are not estimable.

Management evaluates the company’s financial performance in part based on adjusted net income and adjusted diluted earnings per share. We believe that presenting these non-GAAP financial measures enhances an investor’s understanding of CenterPoint Energy’s overall financial performance by providing them with an additional meaningful and relevant comparison of current and anticipated future results across periods. The adjustments made in these non-GAAP financial measures exclude items that Management believes does not most accurately reflect the company’s fundamental business performance. These excluded items are reflected in the reconciliation tables of this news release, where applicable. CenterPoint Energy’s adjusted net income and adjusted diluted earnings per share non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, or superior to, net income and diluted earnings per share, which respectively are the most directly comparable GAAP financial measures. These non-GAAP financial measures also may be different than non-GAAP financial measures used by other companies.

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CenterPoint Energy, Inc. and Subsidiaries

Statements of Consolidated Income

(Millions of Dollars)

(Unaudited)

 

     Quarter Ended     Nine Months Ended  
     September 30,     September 30,  
     2017     2016     2017     2016  

Revenues:

         

Utility revenues

    $ 1,233     $ 1,278     $ 4,001     $ 4,003  

Non-utility revenues

      865       611       2,975       1,444  
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

      2,098       1,889       6,976       5,447  
  

 

 

    

 

 

    

 

 

    

 

 

  

Expenses:

         

Utility natural gas

      106       99       706       663  

Non-utility natural gas

      832       584       2,843       1,368  

Operation and maintenance

      519       505       1,614       1,539  

Depreciation and amortization

      269       324       749       873  

Taxes other than income taxes

      93       93       288       288  
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

      1,819       1,605       6,200       4,731  
  

 

 

    

 

 

    

 

 

    

 

 

  

Operating Income

      279       284       776       716  
  

 

 

    

 

 

    

 

 

    

 

 

  

Other Income (Expense):

         

Gain on marketable securities

      37       77       104       187  

Loss on indexed debt securities

      (36 )      (72 )      (59 )      (258 ) 

Interest and other finance charges

      (80 )      (83 )      (235 )      (256 ) 

Interest on securitization bonds

      (18 )      (23 )      (58 )      (70 ) 

Equity in earnings of unconsolidated affiliate

      68       73       199       164  

Other - net

      17       20       50       41  
  

 

 

    

 

 

    

 

 

    

 

 

  

Total

      (12 )      (8 )      1       (192 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Income Before Income Taxes

      267       276       777       524  

Income Tax Expense

      98       97       281       193  
  

 

 

    

 

 

    

 

 

    

 

 

  

Net Income

    $ 169     $ 179     $ 496     $ 331  
  

 

 

    

 

 

    

 

 

    

 

 

  

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Quarterly Report on Form 10-Q of CenterPoint Energy, Inc.

 

CenterPoint Energy, Inc. and Subsidiaries

Selected Data From Statements of Consolidated Income

(Millions of Dollars, Except Share and Per Share Amounts)

(Unaudited)

 

     Quarter Ended      Nine Months Ended  
     September 30,      September 30,  
     2017      2016      2017      2016  

Basic Earnings Per Common Share

    $ 0.39      $ 0.42      $ 1.15      $ 0.77  
  

 

 

     

 

 

     

 

 

     

 

 

  

Diluted Earnings Per Common Share

    $ 0.39      $ 0.41      $ 1.14      $ 0.76  
  

 

 

     

 

 

     

 

 

     

 

 

  

Dividends Declared per Common Share

    $ 0.2675      $ 0.2575        0.8025      $ 0.7725  

Weighted Average Common Shares Outstanding (000):

            

- Basic

      431,026        430,682        430,939        430,581  

- Diluted

      434,086        433,396        433,999        433,295  

Operating Income by Segment

            

Electric Transmission & Distribution:

            

TDU

    $ 229      $ 234      $ 431      $ 428  

Bond Companies

      18        23        58        70  
  

 

 

     

 

 

     

 

 

     

 

 

  

Total Electric Transmission & Distribution

      247        257        489        498  

Natural Gas Distribution

      19        22        220        202  

Energy Services

      7        5        58        11  

Other Operations

      6        —          9        5  
  

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $ 279      $ 284      $ 776      $ 716  
  

 

 

     

 

 

     

 

 

     

 

 

  

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Quarterly Report on Form 10-Q of CenterPoint Energy, Inc.

 

CenterPoint Energy, Inc. and Subsidiaries

Results of Operations by Segment

(Millions of Dollars)

(Unaudited)

 

    Electric Transmission & Distribution  
    Quarter Ended           Nine Months Ended        
    September 30,     % Diff     September 30,     % Diff  
    2017     2016     Fav/(Unfav)     2017     2016     Fav/(Unfav)  

Results of Operations:

            

Revenues:

            

TDU

   $ 729     $ 725       1%     $ 1,944     $ 1,881       3%  

Bond Companies

     114       183       (38% )      290       450       (36% ) 
 

 

 

    

 

 

      

 

 

    

 

 

    

Total

     843       908       (7% )      2,234       2,331       (4% ) 
 

 

 

    

 

 

      

 

 

    

 

 

    

Expenses:

            

Operation and maintenance, excluding Bond Companies

     344       336       (2% )      1,040       995       (5% ) 

Depreciation and amortization, excluding Bond Companies

     97       96       (1% )      296       285       (4% ) 

Taxes other than income taxes

     59       59       —         177       173       (2% ) 

Bond Companies

     96       160       40%       232       380       39%  
 

 

 

    

 

 

      

 

 

    

 

 

    

Total

     596       651       8%       1,745       1,833       5%  
 

 

 

    

 

 

      

 

 

    

 

 

    

Operating Income

   $ 247     $ 257       (4% )    $ 489     $ 498       (2% ) 
 

 

 

    

 

 

      

 

 

    

 

 

    

Operating Income:

            

TDU

   $ 229     $ 234       (2% )    $ 431     $ 428       1%  

Bond Companies

     18       23       (22% )      58       70       (17% ) 
 

 

 

    

 

 

      

 

 

    

 

 

    

Total Segment Operating Income

   $ 247     $ 257       (4% )    $ 489     $ 498       (2% ) 
 

 

 

    

 

 

      

 

 

    

 

 

    

Electric Transmission & Distribution Operating Data:

        

Actual MWH Delivered

            

Residential

     10,419,309       10,775,739       (3% )      23,511,716       23,426,712       —    

Total

     26,452,650       26,517,635       —         67,956,180       66,838,583       2%  

Weather (average for service area):

            

Percentage of 10-year average:

            

Cooling degree days

     101%       107%       (6% )      106%       101%       5%  

Heating degree days

     0%       0%       0%       42%       85%       (43% ) 

Number of metered customers - end of period:

            

Residential

     2,156,624       2,116,312       2%       2,156,624       2,116,312       2%  

Total

     2,435,558       2,389,014       2%       2,435,558       2,389,014       2%  
    Natural Gas Distribution  
    Quarter Ended           Nine Months Ended        
    September 30,     % Diff     September 30,     % Diff  
    2017     2016     Fav/(Unfav)     2017     2016     Fav/(Unfav)  

Results of Operations:

            

Revenues

   $ 398     $ 377       6%     $ 1,791     $ 1,693       6%  

Natural gas

     117       104       (13% )      742       679       (9% ) 
 

 

 

    

 

 

      

 

 

    

 

 

    

Gross Margin

     281       273       3%       1,049       1,014       3%  
 

 

 

    

 

 

      

 

 

    

 

 

    

Expenses:

            

Operation and maintenance

     163       159       (3% )      531       526       (1% ) 

Depreciation and amortization

     66       61       (8% )      194       180       (8% ) 

Taxes other than income taxes

     33       31       (6% )      104       106       2%  
 

 

 

    

 

 

      

 

 

    

 

 

    

Total

     262       251       (4% )      829       812       (2% ) 
 

 

 

    

 

 

      

 

 

    

 

 

    

Operating Income

   $ 19     $ 22       (14% )    $ 220     $ 202       9%  
 

 

 

    

 

 

      

 

 

    

 

 

    

Natural Gas Distribution Operating Data:

            

Throughput data in BCF

            

Residential

     13       12       8%       94       105       (10% ) 

Commercial and Industrial

     50       51       (2% )      189       193       (2% ) 
 

 

 

    

 

 

      

 

 

    

 

 

    

Total Throughput

     63       63       —         283       298       (5% ) 
 

 

 

    

 

 

      

 

 

    

 

 

    

Weather (average for service area)

            

Percentage of 10-year average:

            

Heating degree days

     60%       21%       39%       73%       86%       (13% ) 

Number of customers - end of period:

            

Residential

     3,179,284       3,143,357       1%       3,179,284       3,143,357       1%  

Commercial and Industrial

     253,041       251,043       1%       253,041       251,043       1%  
 

 

 

    

 

 

      

 

 

    

 

 

    

Total

     3,432,325       3,394,400       1%       3,432,325       3,394,400       1%  
 

 

 

    

 

 

      

 

 

    

 

 

    

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Quarterly Report on Form 10-Q of CenterPoint Energy, Inc.

CenterPoint Energy, Inc. and Subsidiaries

Results of Operations by Segment

(Millions of Dollars)

(Unaudited)

 

     Energy Services  
     Quarter Ended           Nine Months Ended        
     September 30,     % Diff     September 30,     % Diff  
     2017     2016     Fav/(Unfav)     2017      2016     Fav/(Unfav)  

Results of Operations:

              

Revenues

    $ 871     $ 614       42%     $ 2,998      $ 1,450       107%  

Natural gas

      839       591       (42% )      2,865        1,389       (106% ) 
  

 

 

    

 

 

      

 

 

     

 

 

    

Gross Margin

      32       23       39%       133        61       118%  
  

 

 

    

 

 

      

 

 

     

 

 

    

Expenses:

              

Operation and maintenance

      22       16       (38% )      65        43       (51% ) 

Depreciation and amortization

      3       1       (200% )      9        5       (80% ) 

Taxes other than income taxes

      —         1       —         1        2       50%  
  

 

 

    

 

 

      

 

 

     

 

 

    

Total

      25       18       (39% )      75        50       (50% ) 
  

 

 

    

 

 

      

 

 

     

 

 

    

Operating Income

    $ 7     $ 5       40%     $ 58      $ 11       427%  
  

 

 

    

 

 

      

 

 

     

 

 

    

Mark-to-market gain (loss)

    $ 2     $ (2 )      200%     $ 23      $ (18 )      228%  
  

 

 

    

 

 

      

 

 

     

 

 

    

Energy Services Operating Data:

              

Throughput data in BCF

      272       200       36%       864        570       52%  
  

 

 

    

 

 

      

 

 

     

 

 

    

Number of customers - end of period

      30,817       31,669       (3% )      30,817        31,669       (3% ) 
  

 

 

    

 

 

      

 

 

     

 

 

    
     Other Operations  
     Quarter Ended           Nine Months Ended        
     September 30,     % Diff     September 30,     % Diff  
     2017     2016     Fav/(Unfav)     2017      2016     Fav/(Unfav)  

Results of Operations:

              

Revenues

    $ 4     $ 3       33%     $ 11      $ 11       —    

Expenses

      (2 )      3       (167% )      2        6       67%  
  

 

 

    

 

 

      

 

 

     

 

 

    

Operating Income

    $ 6     $ —         —       $ 9      $ 5       80%  
  

 

 

    

 

 

      

 

 

     

 

 

    

Capital Expenditures by Segment

(Millions of Dollars)

(Unaudited)

 

     Quarter Ended      Nine Months Ended  
     September 30,      September 30,  
     2017      2016      2017      2016  

Capital Expenditures by Segment

            

Electric Transmission & Distribution

    $ 192      $ 211      $ 616      $ 638  

Natural Gas Distribution

      158        143        386        371  

Energy Services

      1        1        5        3  

Other Operations

      7        6        19        16  
  

 

 

     

 

 

     

 

 

     

 

 

  

Total

    $    358      $    361      $ 1,026      $ 1,028  
  

 

 

     

 

 

     

 

 

     

 

 

  
Interest Expense Detail  
(Millions of Dollars)  
(Unaudited)  
     Quarter Ended      Nine Months Ended  
     September 30,      September 30,  
     2017      2016      2017      2016  

Interest Expense Detail

            

Amortization of Deferred Financing Cost

    $ 6      $ 6      $ 17      $ 18  

Capitalization of Interest Cost

      (2 )       (2 )       (6 )       (5 ) 

Transition and System Restoration Bond Interest Expense

      18        23        58        70  

Other Interest Expense

      76        79        224        243  
  

 

 

     

 

 

     

 

 

     

 

 

  

Total Interest Expense

    $ 98      $ 106      $ 293      $ 326  
  

 

 

     

 

 

     

 

 

     

 

 

  

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Quarterly Report on Form 10-Q of CenterPoint Energy, Inc.

CenterPoint Energy, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Millions of Dollars)

(Unaudited)

 

     September 30,      December 31,  
     2017      2016  
ASSETS      

Current Assets:

      

Cash and cash equivalents

    $ 201      $ 341  

Other current assets

      2,734        2,582  
  

 

 

     

 

 

  

Total current assets

      2,935        2,923  
  

 

 

     

 

 

  

Property, Plant and Equipment, net

      12,700        12,307  
  

 

 

     

 

 

  

Other Assets:

      

Goodwill

      867        862  

Regulatory assets

      2,539        2,677  

Investment in unconsolidated affiliate

      2,481        2,505  

Preferred units – unconsolidated affiliate

      363        363  

Other non-current assets

      250        192  
  

 

 

     

 

 

  

Total other assets

      6,500        6,599  
  

 

 

     

 

 

  

Total Assets

    $ 22,135      $ 21,829  
  

 

 

     

 

 

  
LIABILITIES AND SHAREHOLDERS’ EQUITY      

Current Liabilities:

      

Short-term borrowings

    $ 48      $ 35  

Current portion of securitization bonds long-term debt

      432        411  

Indexed debt

      120        114  

Current portion of other long-term debt

      550        500  

Other current liabilities

      2,071        2,020  
  

 

 

     

 

 

  

Total current liabilities

      3,221        3,080  
  

 

 

     

 

 

  

Other Liabilities:

      

Accumulated deferred income taxes, net

      5,458        5,263  

Regulatory liabilities

      1,127        1,298  

Other non-current liabilities

      1,180        1,196  
  

 

 

     

 

 

  

Total other liabilities

      7,765        7,757  
  

 

 

     

 

 

  

Long-term Debt:

      

Securitization bonds

      1,500        1,867  

Other

      6,031        5,665  
  

 

 

     

 

 

  

Total long-term debt

      7,531        7,532  
  

 

 

     

 

 

  

Shareholders’ Equity

      3,618        3,460  
  

 

 

     

 

 

  

Total Liabilities and Shareholders’ Equity

    $ 22,135      $ 21,829  
  

 

 

     

 

 

  

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Quarterly Report on Form 10-Q of CenterPoint Energy, Inc.

CenterPoint Energy, Inc. and Subsidiaries

Condensed Statements of Consolidated Cash Flows

(Millions of Dollars)

(Unaudited)

 

     Nine Months Ended September 30,  
     2017     2016  

Cash Flows from Operating Activities:

     

Net income

    $ 496     $ 331  

Adjustments to reconcile net income to net cash provided by operating activities:

     

Depreciation and amortization

      767       892  

Deferred income taxes

      185       150  

Write-down of natural gas inventory

      —         1  

Equity in earnings of unconsolidated affiliate, net of distributions

      (199 )      (164 ) 

Changes in net regulatory assets

      (135 )      (26 ) 

Changes in other assets and liabilities

      (99 )      252  

Other, net

      16       19  
  

 

 

    

 

 

  

Net Cash Provided by Operating Activities

      1,031       1,455  

Net Cash Used in Investing Activities

      (892 )      (739 ) 

Net Cash Used in Financing Activities

      (279 )      (710 ) 
  

 

 

    

 

 

  

Net Increase (Decrease) in Cash and Cash Equivalents

      (140 )      6  

Cash and Cash Equivalents at Beginning of Period

      341       264  
  

 

 

    

 

 

  

Cash and Cash Equivalents at End of Period

    $ 201     $ 270  
  

 

 

    

 

 

  

Reference is made to the Notes to the Consolidated Financial Statements

contained in the Quarterly Report on Form 10-Q of CenterPoint Energy, Inc.