x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Louisiana (State or other jurisdiction of incorporation or organization) | 72-1445282 (I.R.S. Employer Identification No.) |
2030 Donahue Ferry Road, Pineville, Louisiana (Address of principal executive offices) | 71360-5226 (Zip Code) |
Registrant’s telephone number, including area code: (318) 484-7400 |
Louisiana (State or other jurisdiction of incorporation or organization) | 72-0244480 (I.R.S. Employer Identification No.) |
2030 Donahue Ferry Road, Pineville, Louisiana (Address of principal executive offices) | 71360-5226 (Zip Code) |
Registrant’s telephone number, including area code: (318) 484-7400 | |
Indicate by check mark whether the Registrants: (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrants were required to file such reports) and (2) have been subject to such filing requirements for the past 90 days. Yes x No o | |
Indicate by check mark whether the Registrants have submitted electronically and posted on their corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrants were required to submit and post such files). Yes x No o | |
Indicate by check mark whether Cleco Corporation is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer x Accelerated filer o Non-accelerated filer o (Do not check if a smaller reporting company) Smaller reporting company o | |
Indicate by check mark whether Cleco Power LLC is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one): Large accelerated filer o Accelerated filer o Non-accelerated filer x (Do not check if a smaller reporting company) Smaller reporting company o | |
Indicate by check mark whether the Registrants are shell companies (as defined in Rule 12b-2 of the Exchange Act) Yes o No x |
Registrant | Description of Class | Shares Outstanding at July 26, 2013 |
Cleco Corporation | Common Stock, $1.00 Par Value | 60,449,895 |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
TABLE OF CONTENTS | ||
PAGE | ||
ITEM 4. | Mine Safety Disclosures | |
ITEM 5. | Other Information | |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
GLOSSARY OF TERMS |
ABBREVIATION OR ACRONYM | DEFINITION |
401(k) Plan | Cleco Power 401(k) Savings and Investment Plan |
ABR | Alternate Base Rate which is the greater of the prime rate, the federal funds effective rate plus 0.50%, or the LIBOR plus 1.0% |
Acadia | Acadia Power Partners, LLC, a wholly owned subsidiary of APH |
Acadia Unit 1 | Cleco Power’s 580-MW unit, combined cycle, natural gas-fired power plant located at the Acadia Power Station in Eunice, Louisiana |
Acadia Unit 2 | Entergy Louisiana’s 580-MW unit, combined cycle, natural gas-fired power plant located at the Acadia Power Station in Eunice, Louisiana |
AFUDC | Allowance for Funds Used During Construction |
Amended Lignite Mining Agreement | Amended and restated lignite mining agreement effective December 29, 2009 |
AMI | Advanced Metering Infrastructure |
APH | Acadia Power Holdings LLC, a wholly owned subsidiary of Midstream |
Attala | Attala Transmission LLC, a wholly owned subsidiary of Cleco Corporation |
CERCLA | The Comprehensive Environmental Response, Compensation, and Liability Act of 1980 |
Cleco Katrina/Rita | Cleco Katrina/Rita Hurricane Recovery Funding LLC, a wholly owned subsidiary of Cleco Power |
Coughlin | Coughlin Power Station, a combined-cycle, natural gas-fired power plant located in St. Landry, Louisiana |
DHLC | Dolet Hills Lignite Company, LLC, a wholly owned subsidiary of SWEPCO |
Diversified Lands | Diversified Lands LLC, a wholly owned subsidiary of Cleco Corporation |
Dodd-Frank Act | The Dodd-Frank Wall Street Reform and Consumer Protection Act, signed into law on July 21, 2010 |
DOE | United States Department of Energy |
Entergy | Entergy Corporation |
Entergy Gulf States | Entergy Gulf States Louisiana, L.L.C. |
Entergy Louisiana | Entergy Louisiana, LLC |
Entergy Mississippi | Entergy Mississippi, Inc. |
Entergy Services | Entergy Services, Inc., as agent for Entergy Louisiana and Entergy Gulf States |
EPA | United States Environmental Protection Agency |
ERO | Electric Reliability Organization |
ESPP | Cleco Corporation Employee Stock Purchase Plan |
Evangeline | Cleco Evangeline LLC, a wholly owned subsidiary of Midstream |
FAC | Fuel Adjustment Clause |
FASB | Financial Accounting Standards Board |
FERC | Federal Energy Regulatory Commission |
FRP | Formula Rate Plan |
GAAP | Generally Accepted Accounting Principles in the United States |
GO Zone | Gulf Opportunity Zone Act of 2005 (Public Law 109-135) |
Interconnection Agreement | One of two Interconnection and Real Estate Agreements, one between Attala and Entergy Mississippi, and the other between Perryville and Entergy Louisiana |
IRP | Integrated Resource Planning |
IRS | Internal Revenue Service |
kWh | Kilowatt-hour(s) as applicable |
LDEQ | Louisiana Department of Environmental Quality |
LIBOR | London Inter-Bank Offer Rate |
Lignite Mining Agreement | Dolet Hills Mine Lignite Mining Agreement, dated as of May 31, 2001 |
LPSC | Louisiana Public Service Commission |
LTICP | Cleco Corporation Long-Term Incentive Compensation Plans |
Madison Unit 3 | A 600-MW solid-fuel generating unit at Cleco Power’s plant site in Boyce, Louisiana |
MATS | Mercury and Air Toxics Standards |
Midstream | Cleco Midstream Resources LLC, a wholly owned subsidiary of Cleco Corporation |
MISO | Midcontinent Independent System Operator, Inc. |
Moody’s | Moody’s Investors Service |
MW | Megawatt(s) as applicable |
NERC | North American Electric Reliability Corporation |
NMTC | New Markets Tax Credit |
NMTC Fund | USB NMTC Fund 2008-1 LLC was formed to invest in projects qualifying for New Markets Tax Credits and Solar Projects |
Not Meaningful | A percentage comparison of these items is not statistically meaningful because the percentage difference is greater than 1,000% |
OATT | Open Access Transmission Tariff |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
ABBREVIATION OR ACRONYM | DEFINITION |
OCI | Other Comprehensive Income |
Oxbow | Oxbow Lignite Company, LLC, 50% owned by Cleco Power and 50% owned by SWEPCO |
PCAOB | Public Company Accounting Oversight Board |
PCB | Polychlorinated biphenyl |
Perryville | Perryville Energy Partners, L.L.C., a wholly owned subsidiary of Cleco Corporation |
Power Purchase Agreement | Power Purchase Agreement, dated as of January 28, 2004, between Perryville and Entergy Services |
PRP | Potentially responsible party |
Registrant(s) | Cleco Corporation and Cleco Power |
RFP | Request for Proposal |
RTO | Regional Transmission Organization |
Sale Agreement | Purchase and Sale Agreement, dated as of January 28, 2004, between Perryville and Entergy Louisiana |
S&P | Standard & Poor’s Ratings Services, a credit rating agency |
SEC | Securities and Exchange Commission |
SERP | Cleco Corporation Supplemental Executive Retirement Plan |
Support Group | Cleco Support Group LLC, a wholly owned subsidiary of Cleco Corporation |
SWEPCO | Southwestern Electric Power Company, a wholly owned subsidiary of American Electric Power Company, Inc. |
VaR | Value-at-Risk |
VIE | Variable Interest Entity |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS |
• | factors affecting utility operations, such as unusual weather conditions or other natural phenomena, catastrophic weather-related damage (such as hurricanes and other storms or severe drought conditions), unscheduled generation outages, unanticipated maintenance or repairs, unanticipated changes to fuel costs, fuel supply costs or availability constraints due to higher demand, shortages, transportation problems, or other developments, fuel mix of Cleco’s generation facilities, decreased customer load, environmental incidents, environmental compliance costs, and power transmission system constraints, |
• | Cleco Corporation’s holding company structure and its dependence on the earnings, dividends, or distributions from its subsidiaries to meet its debt obligations and pay dividends on its common stock, |
• | Cleco Power’s ability to maintain its right to sell wholesale generation at market-based rates within its control area, |
• | Cleco Power’s dependence on energy from sources other than its facilities and future sources of such additional energy, |
• | nonperformance by and creditworthiness of counterparties under power purchase agreements, or the restructuring of those agreements, including possible termination, |
• | nonperformance by and creditworthiness of the guarantor counterparty of the NMTC Fund, |
• | regulatory factors such as changes in rate-setting policies, recovery of investments made under traditional regulation, recovery of storm restoration costs, the frequency and timing of rate increases or decreases, the results of periodic NERC and LPSC audits, participation in an RTO and Cleco Power’s ability to recover related transmission upgrade costs, the |
• | reliance on third parties for determination of Cleco Power’s commitments and obligations to markets for generation resources and reliance on third party transmission services, |
• | financial or regulatory accounting principles or policies imposed by FASB, the SEC, the PCAOB, FERC, the LPSC, or similar entities with regulatory or accounting oversight, |
• | economic conditions, including the ability of customers to continue paying utility bills, related growth and/or down-sizing of businesses in Cleco’s service area, monetary fluctuations, changes in commodity prices, and inflation rates, |
• | the current global and U.S. economic environment, |
• | credit ratings of Cleco Corporation and Cleco Power, |
• | ability to remain in compliance with debt covenants, |
• | changing market conditions and a variety of other factors associated with physical energy, financial transactions, and energy service activities, including, but not limited to, price, basis, credit, liquidity, volatility, capacity, transmission, interest rates, and warranty risks, |
• | the availability and use of alternative sources of energy and technologies, |
• | the imposition of energy efficiency requirements or increased conservation efforts of customers, |
• | reliability of Cleco Power’s and Midstream’s generating facilities, |
• | acts of terrorism, cyber attacks, data security breaches or other attempts to disrupt Cleco’s business or the business of third parties, or other man-made disasters, |
• | availability or cost of capital resulting from changes in Cleco’s business or financial condition, interest rates, or market perceptions of the electric utility industry and energy-related industries, |
• | changes in tax laws or disallowances of uncertain tax positions that may result in a change to tax benefits or expenses, |
• | employee work force factors, including work stoppages and changes in key executives, |
• | legal, environmental, and regulatory delays and other obstacles associated with mergers, acquisitions, reorganizations, investments in joint ventures, or other capital projects, including the AMI project and the transfer of Coughlin to Cleco Power, |
• | costs and other effects of legal and administrative proceedings, settlements, investigations, claims, and other matters, |
• | changes in federal, state, or local laws and changes in tax laws or rates, or regulating policies, |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
• | the impact of current or future environmental laws and regulations, including those related to greenhouse gases and energy efficiency that could limit or terminate the operation of certain generating units, increase costs, or reduce customer demand for electricity, |
• | the ability of Cleco Power to recover from its customers the costs of compliance with environmental laws and regulations, including capital expenditures associated with MATS, and |
• | the ability of Dolet Hills lignite reserve to provide sufficient fuel to the Dolet Hills Power Station until at least 2026. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
PART I — FINANCIAL INFORMATION |
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO CORPORATION | |||||||
Condensed Consolidated Statements of Income (Unaudited) | |||||||
FOR THE THREE MONTHS ENDED JUNE 30, | |||||||
(THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) | 2013 | 2012 | |||||
Operating revenue | |||||||
Electric operations | $ | 252,765 | $ | 228,293 | |||
Other operations | 11,531 | 12,111 | |||||
Gross operating revenue | 264,296 | 240,404 | |||||
Electric customer credits | (402 | ) | (281 | ) | |||
Operating revenue, net | 263,894 | 240,123 | |||||
Operating expenses | |||||||
Fuel used for electric generation | 72,611 | 54,999 | |||||
Power purchased for utility customers | 13,940 | 16,068 | |||||
Other operations | 31,442 | 28,688 | |||||
Maintenance | 26,310 | 24,184 | |||||
Depreciation | 34,740 | 32,250 | |||||
Taxes other than income taxes | 10,285 | 9,713 | |||||
Gain on sale of assets | (188 | ) | (22 | ) | |||
Total operating expenses | 189,140 | 165,880 | |||||
Operating income | 74,754 | 74,243 | |||||
Interest income | 257 | (3 | ) | ||||
Allowance for other funds used during construction | 413 | 1,399 | |||||
Other income | 8,165 | 13,014 | |||||
Other expense | (1,247 | ) | (831 | ) | |||
Interest charges | |||||||
Interest charges, including amortization of debt expense and premium, net | 21,017 | 21,094 | |||||
Allowance for borrowed funds used during construction | (129 | ) | (478 | ) | |||
Total interest charges | 20,888 | 20,616 | |||||
Income before income taxes | 61,454 | 67,206 | |||||
Federal and state income tax expense | 19,422 | 20,520 | |||||
Net income applicable to common stock | $ | 42,032 | $ | 46,686 | |||
Average number of basic common shares outstanding | 60,445,617 | 60,421,028 | |||||
Average number of diluted common shares outstanding | 60,713,374 | 60,660,702 | |||||
Basic earnings per share | |||||||
Net income applicable to common stock | $ | 0.70 | $ | 0.77 | |||
Diluted earnings per share | |||||||
Net income applicable to common stock | $ | 0.69 | $ | 0.77 | |||
Cash dividends paid per share of common stock | $ | 0.3625 | $ | 0.3125 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO CORPORATION | |||||||
Condensed Consolidated Statements of Comprehensive Income (Unaudited) | |||||||
FOR THE THREE MONTHS ENDED JUNE 30, | |||||||
(THOUSANDS) | 2013 | 2012 | |||||
Net income | $ | 42,032 | $ | 46,686 | |||
Other comprehensive income (loss), net of tax: | |||||||
Amortization of postretirement benefits (net of tax expense of $366 in 2013 and $266 in 2012) | 586 | 525 | |||||
Net gain (loss) on cash flow hedges (net of tax expense of $23 in 2013 and tax benefit of $2,360 in 2012) | 36 | (3,774 | ) | ||||
Total other comprehensive income (loss), net of tax | 622 | (3,249 | ) | ||||
Comprehensive income, net of tax | $ | 42,654 | $ | 43,437 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO CORPORATION | |||||||
Condensed Consolidated Statements of Income (Unaudited) | |||||||
FOR THE SIX MONTHS ENDED JUNE 30, | |||||||
(THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) | 2013 | 2012 | |||||
Operating revenue | |||||||
Electric operations | $ | 482,191 | $ | 437,883 | |||
Other operations | 23,074 | 23,056 | |||||
Gross operating revenue | 505,265 | 460,939 | |||||
Electric customer credits | (424 | ) | 1,955 | ||||
Operating revenue, net | 504,841 | 462,894 | |||||
Operating expenses | |||||||
Fuel used for electric generation | 157,976 | 128,063 | |||||
Power purchased for utility customers | 18,796 | 24,705 | |||||
Other operations | 58,363 | 56,385 | |||||
Maintenance | 43,944 | 41,419 | |||||
Depreciation | 68,773 | 64,097 | |||||
Taxes other than income taxes | 22,919 | 19,743 | |||||
Loss (gain) on sale of assets | 846 | (55 | ) | ||||
Total operating expenses | 371,617 | 334,357 | |||||
Operating income | 133,224 | 128,537 | |||||
Interest income | 457 | 31 | |||||
Allowance for other funds used during construction | 1,577 | 2,416 | |||||
Equity income from investees, before tax | — | 1 | |||||
Other income | 10,438 | 22,389 | |||||
Other expense | (1,683 | ) | (1,486 | ) | |||
Interest charges | |||||||
Interest charges, including amortization of debt expense and premium, net | 42,848 | 42,062 | |||||
Allowance for borrowed funds used during construction | (504 | ) | (822 | ) | |||
Total interest charges | 42,344 | 41,240 | |||||
Income before income taxes | 101,669 | 110,648 | |||||
Federal and state income tax expense | 32,503 | 33,930 | |||||
Net income applicable to common stock | $ | 69,166 | $ | 76,718 | |||
Average number of basic common shares outstanding | 60,419,588 | 60,387,388 | |||||
Average number of diluted common shares outstanding | 60,670,112 | 60,625,377 | |||||
Basic earnings per share | |||||||
Net income applicable to common stock | $ | 1.15 | $ | 1.27 | |||
Diluted earnings per share | |||||||
Net income applicable to common stock | $ | 1.14 | $ | 1.27 | |||
Cash dividends paid per share of common stock | $ | 0.70 | $ | 0.625 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO CORPORATION | |||||||
Condensed Consolidated Statements of Comprehensive Income (Unaudited) | |||||||
FOR THE SIX MONTHS ENDED JUNE 30, | |||||||
(THOUSANDS) | 2013 | 2012 | |||||
Net income | $ | 69,166 | $ | 76,718 | |||
Other comprehensive income, net of tax: | |||||||
Amortization of postretirement benefits (net of tax expense of $702 in 2013 and $431 in 2012) | 1,122 | 888 | |||||
Net gain on cash flow hedges (net of tax expense of $859 in 2013 and $413 in 2012) | 1,373 | 661 | |||||
Total other comprehensive income, net of tax | 2,495 | 1,549 | |||||
Comprehensive income, net of tax | $ | 71,661 | $ | 78,267 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO CORPORATION | |||||||
Condensed Consolidated Balance Sheets (Unaudited) | |||||||
(THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Assets | |||||||
Current assets | |||||||
Cash and cash equivalents | $ | 7,567 | $ | 31,020 | |||
Restricted cash and cash equivalents | 8,067 | 8,781 | |||||
Customer accounts receivable (less allowance for doubtful accounts of $862 in 2013 and $1,105 in 2012) | 48,732 | 39,293 | |||||
Other accounts receivable | 40,693 | 37,741 | |||||
Taxes receivable, net | — | 34,612 | |||||
Unbilled revenue | 36,012 | 28,662 | |||||
Fuel inventory, at average cost | 53,220 | 46,867 | |||||
Material and supplies inventory, at average cost | 61,671 | 58,232 | |||||
Accumulated deferred federal and state income taxes, net | 46,443 | 79,353 | |||||
Accumulated deferred fuel | 9,593 | 7,833 | |||||
Cash surrender value of company-/trust-owned life insurance policies | 60,006 | 57,346 | |||||
Prepayments | 6,111 | 5,951 | |||||
Regulatory assets - other | 7,803 | 11,095 | |||||
Other current assets | 17 | 552 | |||||
Total current assets | 385,935 | 447,338 | |||||
Property, plant, and equipment | |||||||
Property, plant, and equipment | 4,233,991 | 4,140,194 | |||||
Accumulated depreciation | (1,350,533 | ) | (1,311,273 | ) | |||
Net property, plant, and equipment | 2,883,458 | 2,828,921 | |||||
Construction work in progress | 158,763 | 180,540 | |||||
Total property, plant, and equipment, net | 3,042,221 | 3,009,461 | |||||
Equity investment in investees | 14,541 | 14,540 | |||||
Prepayments | 4,143 | 4,261 | |||||
Restricted cash and cash equivalents | 4,423 | 5,440 | |||||
Restricted investments | 12,548 | 10,852 | |||||
Regulatory assets - deferred taxes, net | 213,061 | 210,445 | |||||
Regulatory assets - other | 290,764 | 289,570 | |||||
Net investment in direct financing lease | 13,533 | 13,542 | |||||
Intangible asset | 113,720 | 120,545 | |||||
Other deferred charges | 21,247 | 21,355 | |||||
Total assets | $ | 4,116,136 | $ | 4,147,349 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. | |||||||
(Continued on next page) |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO CORPORATION | |||||||
Condensed Consolidated Balance Sheets (Unaudited) | |||||||
(THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Liabilities and shareholders’ equity | |||||||
Liabilities | |||||||
Current liabilities | |||||||
Short-term debt | $ | 3,000 | $ | — | |||
Long-term debt due within one year | 16,658 | 91,140 | |||||
Accounts payable | 93,981 | 102,695 | |||||
Customer deposits | 47,546 | 45,553 | |||||
Provision for rate refund | 4,589 | 4,165 | |||||
Taxes payable | 29,856 | — | |||||
Interest accrued | 12,115 | 12,957 | |||||
Interest rate risk management liability | — | 2,627 | |||||
Regulatory liabilities - other | — | 8,255 | |||||
Deferred compensation | 10,148 | 9,626 | |||||
Uncertain tax positions | 686 | 686 | |||||
Other current liabilities | 15,237 | 16,926 | |||||
Total current liabilities | 233,816 | 294,630 | |||||
Deferred credits | |||||||
Accumulated deferred federal and state income taxes, net | 762,173 | 762,992 | |||||
Accumulated deferred investment tax credits | 5,698 | 6,252 | |||||
Postretirement benefit obligations | 155,490 | 186,746 | |||||
Restricted storm reserve | 16,952 | 16,285 | |||||
Uncertain tax positions | 2,184 | 2,184 | |||||
Tax credit fund investment, net | 60,016 | 78,840 | |||||
Contingent sale obligations | 950 | 8,150 | |||||
Other deferred credits | 23,758 | 34,799 | |||||
Total deferred credits | 1,027,221 | 1,096,248 | |||||
Long-term debt, net | 1,323,765 | 1,257,258 | |||||
Total liabilities | 2,584,802 | 2,648,136 | |||||
Commitments and Contingencies (Note 11) | |||||||
Shareholders’ equity | |||||||
Common shareholders’ equity | |||||||
Common stock, $1 par value, authorized 100,000,000 shares, issued 61,047,006 and 60,961,570 shares and outstanding 60,449,214 and 60,355,545 shares at June 30, 2013 and December 31, 2012, respectively | 61,047 | 60,962 | |||||
Premium on common stock | 419,322 | 416,619 | |||||
Retained earnings | 1,101,626 | 1,075,074 | |||||
Treasury stock, at cost, 597,792 and 606,025 shares at June 30, 2013 and December 31, 2012, respectively | (20,786 | ) | (21,072 | ) | |||
Accumulated other comprehensive loss | (29,875 | ) | (32,370 | ) | |||
Total shareholders’ equity | 1,531,334 | 1,499,213 | |||||
Total liabilities and shareholders’ equity | $ | 4,116,136 | $ | 4,147,349 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO CORPORATION | |||||||
Condensed Consolidated Statements of Cash Flows (Unaudited) | |||||||
FOR THE SIX MONTHS ENDED JUNE 30, | |||||||
(THOUSANDS) | 2013 | 2012 | |||||
Operating activities | |||||||
Net income | $ | 69,166 | $ | 76,718 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 72,675 | 72,963 | |||||
Unearned compensation expense | 3,055 | 2,912 | |||||
Allowance for other funds used during construction | (1,577 | ) | (2,416 | ) | |||
Net deferred income taxes | 26,638 | (3,542 | ) | ||||
Deferred fuel costs | (478 | ) | (4,670 | ) | |||
Cash surrender value of company-/trust-owned life insurance | (2,280 | ) | (1,486 | ) | |||
Changes in assets and liabilities: | |||||||
Accounts receivable | (9,475 | ) | (1,620 | ) | |||
Unbilled revenue | (7,350 | ) | (5,704 | ) | |||
Fuel, materials and supplies inventory | (9,793 | ) | (9,978 | ) | |||
Accounts payable | (21,026 | ) | (41,841 | ) | |||
Customer deposits | 6,316 | 5,860 | |||||
Postretirement benefit obligations | (31,020 | ) | 4,167 | ||||
Regulatory assets and liabilities, net | (11,842 | ) | (8,207 | ) | |||
Other deferred accounts | (10,189 | ) | (7,322 | ) | |||
Taxes accrued | 64,389 | 31,039 | |||||
Interest accrued | (842 | ) | (5,109 | ) | |||
Other operating | (1,005 | ) | 1,547 | ||||
Net cash provided by operating activities | 135,362 | 103,311 | |||||
Investing activities | |||||||
Additions to property, plant, and equipment | (85,369 | ) | (102,278 | ) | |||
Allowance for other funds used during construction | 1,577 | 2,416 | |||||
Property, plant, and equipment grants | 729 | 4,603 | |||||
Insurance reimbursement for property loss | — | 5,454 | |||||
Return of equity investment in tax credit fund | 9 | 22,210 | |||||
Contributions to tax credit fund | (24,162 | ) | (31,326 | ) | |||
Transfer of cash from restricted accounts | 1,730 | 192 | |||||
Purchase of restricted investments | (4,334 | ) | — | ||||
Maturity of restricted investments | 2,559 | — | |||||
Other investing | 139 | (1,096 | ) | ||||
Net cash used in investing activities | (107,122 | ) | (99,825 | ) | |||
Financing activities | |||||||
Issuance of short-term debt | $ | 3,000 | $ | — | |||
Draws on credit facility | 173,000 | — | |||||
Payments on credit facility | (173,000 | ) | (10,000 | ) | |||
Issuance of long-term debt | 160,000 | 50,000 | |||||
Retirement of long-term debt | (107,129 | ) | (67,957 | ) | |||
Repurchase of long-term debt | (60,000 | ) | — | ||||
Repurchase of common stock | — | (8,007 | ) | ||||
Settlement of interest rate swap | (3,269 | ) | — | ||||
Dividends paid on common stock | (42,520 | ) | (38,077 | ) | |||
Other financing | (1,775 | ) | 672 | ||||
Net cash used in financing activities | (51,693 | ) | (73,369 | ) | |||
Net decrease in cash and cash equivalents | (23,453 | ) | (69,883 | ) | |||
Cash and cash equivalents at beginning of period | 31,020 | 93,576 | |||||
Cash and cash equivalents at end of period | $ | 7,567 | $ | 23,693 | |||
Supplementary cash flow information | |||||||
Interest paid (net of amount capitalized) | $ | 39,120 | $ | 40,320 | |||
Income taxes (refunded) paid, net | $ | (45,789 | ) | $ | 13 | ||
Supplementary non-cash investing and financing activities | |||||||
Accrued additions to property, plant, and equipment | $ | 13,096 | $ | 13,921 | |||
Non-cash additions to property, plant, and equipment, net | $ | 1,280 | $ | 7,105 | |||
Issuance of common stock – ESPP | $ | 160 | $ | 86 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO CORPORATION | |||||||||||||||||||||||||||||
Condensed Consolidated Statements of Changes in Common Shareholders’ Equity (Unaudited) | |||||||||||||||||||||||||||||
COMMON STOCK | TREASURY STOCK | PREMIUM ON COMMON STOCK | RETAINED EARNINGS | ACCUMULATED OTHER COMPREHENSIVE LOSS | TOTAL SHAREHOLDERS’ EQUITY | ||||||||||||||||||||||||
(THOUSANDS, EXCEPT SHARE AMOUNTS) | SHARES | AMOUNT | SHARES | COST | |||||||||||||||||||||||||
Balances, Dec. 31, 2011 | 60,702,342 | $ | 60,702 | (410,403 | ) | $ | (13,215 | ) | $ | 409,904 | $ | 990,605 | $ | (28,139 | ) | $ | 1,419,857 | ||||||||||||
Common stock issued for compensatory plans | 246,738 | 247 | 3,561 | 122 | 3,944 | — | — | 4,313 | |||||||||||||||||||||
Repurchase of common stock | — | — | (200,000 | ) | (8,007 | ) | — | — | — | (8,007 | ) | ||||||||||||||||||
Dividends on common stock, $0.625 per share | — | — | — | — | — | (38,163 | ) | — | (38,163 | ) | |||||||||||||||||||
Net income | — | — | — | — | — | 76,718 | — | 76,718 | |||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | — | 1,549 | 1,549 | |||||||||||||||||||||
Balances, June 30, 2012 | 60,949,080 | $ | 60,949 | (606,842 | ) | $ | (21,100 | ) | $ | 413,848 | $ | 1,029,160 | $ | (26,590 | ) | $ | 1,456,267 | ||||||||||||
Balances, Dec. 31, 2012 | 60,961,570 | $ | 60,962 | (606,025 | ) | $ | (21,072 | ) | $ | 416,619 | $ | 1,075,074 | $ | (32,370 | ) | $ | 1,499,213 | ||||||||||||
Common stock issued for compensatory plans | 85,436 | 85 | 8,233 | 286 | 2,703 | — | — | 3,074 | |||||||||||||||||||||
Dividends on common stock, $0.70 per share | — | — | — | — | — | (42,614 | ) | — | (42,614 | ) | |||||||||||||||||||
Net income | — | — | — | — | — | 69,166 | — | 69,166 | |||||||||||||||||||||
Other comprehensive income, net of tax | — | — | — | — | — | — | 2,495 | 2,495 | |||||||||||||||||||||
Balances, June 30, 2013 | 61,047,006 | $ | 61,047 | (597,792 | ) | $ | (20,786 | ) | $ | 419,322 | $ | 1,101,626 | $ | (29,875 | ) | $ | 1,531,334 | ||||||||||||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
PART I — FINANCIAL INFORMATION |
ITEM 1. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO POWER | |||||||
Condensed Consolidated Statements of Income (Unaudited) | |||||||
FOR THE THREE MONTHS ENDED JUNE 30, | |||||||
(THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) | 2013 | 2012 | |||||
Operating revenue | |||||||
Electric operations | $ | 252,765 | $ | 228,293 | |||
Other operations | 11,027 | 11,613 | |||||
Affiliate revenue | 335 | 342 | |||||
Gross operating revenue | 264,127 | 240,248 | |||||
Electric customer credits | (402 | ) | (281 | ) | |||
Operating revenue, net | 263,725 | 239,967 | |||||
Operating expenses | |||||||
Fuel used for electric generation | 72,611 | 54,695 | |||||
Power purchased for utility customers | 23,247 | 22,367 | |||||
Other operations | 29,540 | 27,243 | |||||
Maintenance | 23,585 | 19,630 | |||||
Depreciation | 32,959 | 30,559 | |||||
Taxes other than income taxes | 9,204 | 8,682 | |||||
Gain on sale of assets | — | (1 | ) | ||||
Total operating expenses | 191,146 | 163,175 | |||||
Operating income | 72,579 | 76,792 | |||||
Interest income | 255 | (6 | ) | ||||
Allowance for other funds used during construction | 413 | 1,399 | |||||
Other income | 1,268 | 1,228 | |||||
Other expense | (1,208 | ) | (823 | ) | |||
Interest charges | |||||||
Interest charges, including amortization of debt expense and premium, net | 21,007 | 21,283 | |||||
Allowance for borrowed funds used during construction | (129 | ) | (478 | ) | |||
Total interest charges | 20,878 | 20,805 | |||||
Income before income taxes | 52,429 | 57,785 | |||||
Federal and state income tax expense | 17,965 | 20,501 | |||||
Net income | $ | 34,464 | $ | 37,284 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO POWER | |||||||
Condensed Consolidated Statements of Comprehensive Income (Unaudited) | |||||||
FOR THE THREE MONTHS ENDED JUNE 30, | |||||||
(THOUSANDS) | 2013 | 2012 | |||||
Net income | $ | 34,464 | $ | 37,284 | |||
Other comprehensive income (loss), net of tax: | |||||||
Amortization of postretirement benefits (net of tax expense of $168 in 2013 and $89 in 2012) | 269 | 226 | |||||
Net gain (loss) on cash flow hedges (net of tax expense of $23 in 2013 and tax benefit of $2,360 in 2012) | 36 | (3,774 | ) | ||||
Total other comprehensive income (loss), net of tax | 305 | (3,548 | ) | ||||
Comprehensive income, net of tax | $ | 34,769 | $ | 33,736 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO POWER | |||||||
Condensed Consolidated Statements of Income (Unaudited) | |||||||
FOR THE SIX MONTHS ENDED JUNE 30, | |||||||
(THOUSANDS) | 2013 | 2012 | |||||
Operating revenue | |||||||
Electric operations | $ | 482,191 | $ | 437,883 | |||
Other operations | 22,064 | 22,062 | |||||
Affiliate revenue | 670 | 687 | |||||
Gross operating revenue | 504,925 | 460,632 | |||||
Electric customer credits | (424 | ) | 1,955 | ||||
Operating revenue, net | 504,501 | 462,587 | |||||
Operating expenses | |||||||
Fuel used for electric generation | 157,976 | 127,759 | |||||
Power purchased for utility customers | 32,940 | 32,239 | |||||
Other operations | 54,912 | 53,585 | |||||
Maintenance | 38,379 | 35,644 | |||||
Depreciation | 65,288 | 60,648 | |||||
Taxes other than income taxes | 20,662 | 17,614 | |||||
Gain on sale of assets | — | (1 | ) | ||||
Total operating expenses | 370,157 | 327,488 | |||||
Operating income | 134,344 | 135,099 | |||||
Interest income | 453 | 23 | |||||
Allowance for other funds used during construction | 1,577 | 2,416 | |||||
Other income | 1,965 | 2,323 | |||||
Other expense | (1,652 | ) | (1,473 | ) | |||
Interest charges | |||||||
Interest charges, including amortization of debt expense and premium, net | 42,731 | 40,113 | |||||
Allowance for borrowed funds used during construction | (504 | ) | (822 | ) | |||
Total interest charges | 42,227 | 39,291 | |||||
Income before income taxes | 94,460 | 99,097 | |||||
Federal and state income tax expense | 32,203 | 35,008 | |||||
Net income | $ | 62,257 | $ | 64,089 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO POWER | |||||||
Condensed Consolidated Statements of Comprehensive Income (Unaudited) | |||||||
FOR THE SIX MONTHS ENDED JUNE 30, | |||||||
(THOUSANDS) | 2013 | 2012 | |||||
Net income | $ | 62,257 | $ | 64,089 | |||
Other comprehensive income, net of tax: | |||||||
Amortization of postretirement benefits (net of tax expense of $325 in 2013 and $163 in 2012) | 520 | 431 | |||||
Net gain on cash flow hedges (net of tax expense of $859 in 2013 and $413 in 2012) | 1,373 | 661 | |||||
Total other comprehensive income, net of tax | 1,893 | 1,092 | |||||
Comprehensive income, net of tax | $ | 64,150 | $ | 65,181 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO POWER | |||||||
Condensed Consolidated Balance Sheets (Unaudited) | |||||||
(THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Assets | |||||||
Utility plant and equipment | |||||||
Property, plant, and equipment | $ | 3,964,491 | $ | 3,871,940 | |||
Accumulated depreciation | (1,262,963 | ) | (1,227,078 | ) | |||
Net property, plant, and equipment | 2,701,528 | 2,644,862 | |||||
Construction work in progress | 152,568 | 176,584 | |||||
Total utility plant, net | 2,854,096 | 2,821,446 | |||||
Current assets | |||||||
Cash and cash equivalents | 2,743 | 23,368 | |||||
Restricted cash and cash equivalents | 8,067 | 8,781 | |||||
Customer accounts receivable (less allowance for doubtful accounts of $862 in 2013 and $1,105 in 2012) | 48,732 | 39,293 | |||||
Accounts receivable - affiliate | 796 | 2,991 | |||||
Other accounts receivable | 40,186 | 37,562 | |||||
Unbilled revenue | 36,012 | 28,662 | |||||
Fuel inventory, at average cost | 53,220 | 46,867 | |||||
Material and supplies inventory, at average cost | 58,877 | 55,472 | |||||
Accumulated deferred federal and state income taxes, net | 53,061 | 87,286 | |||||
Accumulated deferred fuel | 9,593 | 7,833 | |||||
Cash surrender value of company-owned life insurance policies | 21,040 | 20,842 | |||||
Prepayments | 4,592 | 4,415 | |||||
Regulatory assets - other | 7,803 | 11,095 | |||||
Other current assets | — | 371 | |||||
Total current assets | 344,722 | 374,838 | |||||
Equity investment in investee | 14,532 | 14,532 | |||||
Prepayments | 4,143 | 4,261 | |||||
Restricted cash and cash equivalents | 4,327 | 5,343 | |||||
Restricted investments | 12,548 | 10,852 | |||||
Regulatory assets - deferred taxes, net | 213,061 | 210,445 | |||||
Regulatory assets - other | 290,764 | 289,570 | |||||
Intangible asset | 113,720 | 120,545 | |||||
Other deferred charges | 19,949 | 19,897 | |||||
Total assets | $ | 3,871,862 | $ | 3,871,729 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. | |||||||
(Continued on next page) |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO POWER | |||||||
Condensed Consolidated Balance Sheets (Unaudited) | |||||||
(THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Liabilities and member’s equity | |||||||
Member’s equity | $ | 1,359,069 | $ | 1,319,919 | |||
Long-term debt, net | 1,298,765 | 1,232,258 | |||||
Total capitalization | 2,657,834 | 2,552,177 | |||||
Current liabilities | |||||||
Short-term debt | $ | 3,000 | $ | — | |||
Long-term debt due within one year | 16,658 | 91,140 | |||||
Accounts payable | 86,527 | 89,782 | |||||
Accounts payable - affiliate | 11,373 | 10,097 | |||||
Customer deposits | 47,546 | 45,553 | |||||
Provision for rate refund | 4,589 | 4,165 | |||||
Taxes payable | 16,770 | 1,328 | |||||
Interest accrued | 13,583 | 13,893 | |||||
Interest rate risk management liability | — | 2,627 | |||||
Regulatory liabilities - other | — | 8,255 | |||||
Other current liabilities | 11,582 | 11,746 | |||||
Total current liabilities | 211,628 | 278,586 | |||||
Commitments and Contingencies (Note 11) | |||||||
Deferred credits | |||||||
Accumulated deferred federal and state income taxes, net | 850,423 | 845,769 | |||||
Accumulated deferred investment tax credits | 5,698 | 6,252 | |||||
Postretirement benefit obligations | 105,642 | 137,637 | |||||
Restricted storm reserve | 16,952 | 16,285 | |||||
Uncertain tax positions | 222 | 222 | |||||
Other deferred credits | 23,463 | 34,801 | |||||
Total deferred credits | 1,002,400 | 1,040,966 | |||||
Total liabilities and member’s equity | $ | 3,871,862 | $ | 3,871,729 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO POWER | |||||||
Condensed Consolidated Statements of Cash Flows (Unaudited) | |||||||
FOR THE SIX MONTHS ENDED JUNE 30, | |||||||
(THOUSANDS) | 2013 | 2012 | |||||
Operating activities | |||||||
Net income | $ | 62,257 | $ | 64,089 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 70,893 | 66,482 | |||||
Allowance for other funds used during construction | (1,577 | ) | (2,416 | ) | |||
Net deferred income taxes | 33,802 | 19,830 | |||||
Deferred fuel costs | (478 | ) | (4,670 | ) | |||
Changes in assets and liabilities: | |||||||
Accounts receivable | (9,147 | ) | (2,468 | ) | |||
Accounts and notes receivable, affiliate | 2,361 | (1,439 | ) | ||||
Unbilled revenue | (7,350 | ) | (5,704 | ) | |||
Fuel, materials and supplies inventory | (9,758 | ) | (9,926 | ) | |||
Accounts payable | (15,924 | ) | (36,382 | ) | |||
Accounts and notes payable, affiliate | 575 | 1,351 | |||||
Customer deposits | 6,316 | 5,860 | |||||
Postretirement benefit obligations | (31,959 | ) | 3,103 | ||||
Regulatory assets and liabilities, net | (11,842 | ) | (8,207 | ) | |||
Other deferred accounts | (11,187 | ) | (10,363 | ) | |||
Taxes accrued | 15,442 | 17,972 | |||||
Interest accrued | (309 | ) | (3,191 | ) | |||
Other operating | 93 | (409 | ) | ||||
Net cash provided by operating activities | 92,208 | 93,512 | |||||
Investing activities | |||||||
Additions to property, plant, and equipment | (81,436 | ) | (99,392 | ) | |||
Allowance for other funds used during construction | 1,577 | 2,416 | |||||
Property, plant, and equipment grants | 729 | 4,603 | |||||
Transfer of cash from restricted accounts | 1,730 | 192 | |||||
Purchase of restricted investments | (4,334 | ) | — | ||||
Maturity of restricted investments | 2,559 | — | |||||
Other investing | 515 | 597 | |||||
Net cash used in investing activities | (78,660 | ) | (91,584 | ) | |||
Financing activities | |||||||
Issuance of short-term debt | 3,000 | — | |||||
Draws on credit facility | 140,000 | — | |||||
Payments on credit facility | (140,000 | ) | — | ||||
Issuance of long-term debt | 160,000 | 50,000 | |||||
Retirement of long-term debt | (107,129 | ) | (67,957 | ) | |||
Repurchase of long-term debt | (60,000 | ) | — | ||||
Settlement of interest rate swap | (3,269 | ) | — | ||||
Distribution to parent | (25,000 | ) | (40,000 | ) | |||
Other financing | (1,775 | ) | (1,193 | ) | |||
Net cash used in financing activities | (34,173 | ) | (59,150 | ) | |||
Net decrease in cash and cash equivalents | (20,625 | ) | (57,222 | ) | |||
Cash and cash equivalents at beginning of period | 23,368 | 67,458 | |||||
Cash and cash equivalents at end of period | $ | 2,743 | $ | 10,236 | |||
Supplementary cash flow information | |||||||
Interest paid (net of amount capitalized) | $ | 38,966 | $ | 40,248 | |||
Income taxes refunded, net | $ | (456 | ) | $ | — | ||
Supplementary non-cash investing and financing activities | |||||||
Accrued additions to property, plant, and equipment | $ | 13,026 | $ | 13,714 | |||
Non-cash additions to property, plant, and equipment, net | $ | 1,280 | $ | 7,105 | |||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO POWER | |||||||||||
Condensed Consolidated Statements of Changes in Member’s Equity (Unaudited) | |||||||||||
(THOUSANDS) | RETAINED EARNINGS | ACCUMULATED OTHER COMPREHENSIVE LOSS | TOTAL MEMBER’S EQUITY | ||||||||
Balances, Dec. 31, 2011 | $ | 1,251,492 | $ | (20,630 | ) | $ | 1,230,862 | ||||
Other comprehensive income, net of tax | — | 1,092 | 1,092 | ||||||||
Distribution to parent | (40,000 | ) | — | (40,000 | ) | ||||||
Net income | 64,089 | — | 64,089 | ||||||||
Balances, June 30, 2012 | $ | 1,275,581 | $ | (19,538 | ) | $ | 1,256,043 | ||||
Balances, Dec. 31, 2012 | $ | 1,340,340 | $ | (20,421 | ) | $ | 1,319,919 | ||||
Other comprehensive income, net of tax | — | 1,893 | 1,893 | ||||||||
Distribution to parent | (25,000 | ) | — | (25,000 | ) | ||||||
Net income | 62,257 | — | 62,257 | ||||||||
Balances, June 30, 2013 | $ | 1,377,597 | $ | (18,528 | ) | $ | 1,359,069 | ||||
The accompanying notes are an integral part of the Condensed Consolidated Financial Statements. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
Index to Applicable Notes to the Unaudited Condensed Consolidated Financial Statements of Registrants | ||
Note 1 | Summary of Significant Accounting Policies | Cleco Corporation and Cleco Power |
Note 2 | Recent Authoritative Guidance | Cleco Corporation and Cleco Power |
Note 3 | Regulatory Assets and Liabilities | Cleco Corporation and Cleco Power |
Note 4 | Fair Value Accounting | Cleco Corporation and Cleco Power |
Note 5 | Debt | Cleco Corporation and Cleco Power |
Note 6 | Pension Plan and Employee Benefits | Cleco Corporation and Cleco Power |
Note 7 | Income Taxes | Cleco Corporation and Cleco Power |
Note 8 | Disclosures about Segments | Cleco Corporation |
Note 9 | Electric Customer Credits | Cleco Corporation and Cleco Power |
Note 10 | Variable Interest Entities | Cleco Corporation and Cleco Power |
Note 11 | Litigation, Other Commitments and Contingencies, and Disclosures about Guarantees | Cleco Corporation and Cleco Power |
Note 12 | Affiliate Transactions | Cleco Corporation and Cleco Power |
Note 13 | Storm Restoration | Cleco Corporation and Cleco Power |
Note 14 | Accumulated Other Comprehensive Loss | Cleco Corporation and Cleco Power |
Notes to the Unaudited Condensed Consolidated Financial Statements |
Note 1 — Summary of Significant Accounting Policies |
(THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Regulated utility plants | $ | 3,964,491 | $ | 3,871,940 | |||
Other | 269,500 | 268,254 | |||||
Total property, plant, and equipment | 4,233,991 | 4,140,194 | |||||
Accumulated depreciation | (1,350,533 | ) | (1,311,273 | ) | |||
Net property, plant, and equipment | $ | 2,883,458 | $ | 2,828,921 |
(THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Diversified Lands’ mitigation escrow | $ | 97 | $ | 97 | |||
Cleco Katrina/Rita’s storm recovery bonds | 8,067 | 8,781 | |||||
Cleco Power’s future storm restoration costs | 4,326 | 5,343 | |||||
Total restricted cash and cash equivalents | $ | 12,490 | $ | 14,221 |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
FOR THE THREE MONTHS ENDED JUNE 30, | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
(THOUSANDS, EXCEPT SHARES AND PER SHARE AMOUNTS) | INCOME | SHARES | PER SHARE AMOUNT | INCOME | SHARES | PER SHARE AMOUNT | |||||||||||||||
Basic net income applicable to common stock | $ | 42,032 | 60,445,617 | $ | 0.70 | $ | 46,686 | 60,421,028 | $ | 0.77 | |||||||||||
Effect of dilutive securities | |||||||||||||||||||||
Add: stock option grants | — | 1,504 | |||||||||||||||||||
Add: restricted stock (LTICP) | 267,757 | 238,170 | |||||||||||||||||||
Diluted net income applicable to common stock | $ | 42,032 | 60,713,374 | $ | 0.69 | $ | 46,686 | 60,660,702 | $ | 0.77 |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
FOR THE SIX MONTHS ENDED JUNE 30, | |||||||||||||||||||||
2013 | 2012 | ||||||||||||||||||||
(THOUSANDS, EXCEPT SHARES AND PER SHARE AMOUNTS) | INCOME | SHARES | PER SHARE AMOUNT | INCOME | SHARES | PER SHARE AMOUNT | |||||||||||||||
Basic net income applicable to common stock | $ | 69,166 | 60,419,588 | $ | 1.15 | $ | 76,718 | 60,387,388 | $ | 1.27 | |||||||||||
Effect of dilutive securities | |||||||||||||||||||||
Add: stock option grants | — | 4,455 | |||||||||||||||||||
Add: restricted stock (LTICP) | 250,524 | 233,534 | |||||||||||||||||||
Diluted net income applicable to common stock | $ | 69,166 | 60,670,112 | $ | 1.14 | $ | 76,718 | 60,625,377 | $ | 1.27 |
CLECO CORPORATION | CLECO POWER | CLECO CORPORATION | CLECO POWER | ||||||||||||||||||||||||||||
FOR THE THREE MONTHS ENDED JUNE 30, | FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||||||||||||||||||||||||
(THOUSANDS) | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||
Equity classification | |||||||||||||||||||||||||||||||
Non-vested stock | $ | 1,474 | $ | 1,076 | $ | 381 | $ | 277 | $ | 2,902 | $ | 2,132 | $ | 711 | $ | 491 | |||||||||||||||
Stock options | — | 5 | — | — | — | 9 | — | — | |||||||||||||||||||||||
Total equity classification | $ | 1,474 | $ | 1,081 | $ | 381 | $ | 277 | $ | 2,902 | $ | 2,141 | $ | 711 | $ | 491 | |||||||||||||||
Liability classification | |||||||||||||||||||||||||||||||
Common stock equivalent units | $ | — | $ | 518 | $ | — | $ | 210 | $ | 1 | $ | 706 | $ | 1 | $ | 294 | |||||||||||||||
Total pre-tax compensation expense | $ | 1,474 | $ | 1,599 | $ | 381 | $ | 487 | $ | 2,903 | $ | 2,847 | $ | 712 | $ | 785 | |||||||||||||||
Tax benefit | $ | 567 | $ | 615 | $ | 146 | $ | 187 | $ | 1,117 | $ | 1,095 | $ | 274 | $ | 302 |
Note 2 — Recent Authoritative Guidance |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
Note 3 — Regulatory Assets and Liabilities |
(THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Regulatory assets – deferred taxes, net | $ | 213,061 | $ | 210,445 | |||
Mining costs | $ | 15,294 | $ | 16,569 | |||
Interest costs | 6,123 | 6,304 | |||||
Asset removal costs | 901 | 867 | |||||
Postretirement plan costs | 149,884 | 156,458 | |||||
Tree trimming costs | 4,299 | 5,656 | |||||
Training costs | 7,252 | 7,330 | |||||
Storm surcredits, net | 7,654 | 6,211 | |||||
Construction carrying costs | 1,563 | 4,697 | |||||
Lignite mining agreement contingency | 3,781 | 3,781 | |||||
Power purchase agreement capacity costs | 11,912 | 6,217 | |||||
AMI deferred revenue requirement | 2,907 | 1,483 | |||||
AFUDC equity gross-up | 73,785 | 74,158 | |||||
Rate case costs | 313 | 581 | |||||
Acadia Unit 1 acquisition costs | 2,813 | 2,865 | |||||
IRP/RFP costs | — | 39 | |||||
AMI pilot costs | — | 22 | |||||
Financing costs | 9,957 | 7,282 | |||||
Biomass costs | 129 | 145 | |||||
Total regulatory assets – other | $ | 298,567 | $ | 300,665 | |||
Construction carrying costs | — | (8,255 | ) | ||||
Fuel and purchased power | 9,593 | 7,833 | |||||
Total regulatory assets, net | $ | 521,221 | $ | 510,688 |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
Note 4 — Fair Value Accounting |
Cleco | |||||||||||||||
AT JUNE 30, 2013 | AT DEC. 31, 2012 | ||||||||||||||
(THOUSANDS) | CARRYING VALUE | ESTIMATED FAIR VALUE | CARRYING VALUE | ESTIMATED FAIR VALUE | |||||||||||
Financial instruments not marked-to-market: | |||||||||||||||
Cash and cash equivalents | $ | 7,567 | $ | 7,567 | $ | 31,020 | $ | 31,020 | |||||||
Restricted cash and cash equivalents | $ | 12,490 | $ | 12,490 | $ | 14,221 | $ | 14,221 | |||||||
Short-term debt, excluding debt issuance costs | $ | 3,000 | $ | 3,000 | $ | — | $ | — | |||||||
Long-term debt, excluding debt issuance costs | $ | 1,338,069 | $ | 1,455,061 | $ | 1,345,198 | $ | 1,579,674 |
Cleco Power | |||||||||||||||
AT JUNE 30, 2013 | AT DEC. 31, 2012 | ||||||||||||||
(THOUSANDS) | CARRYING VALUE | ESTIMATED FAIR VALUE | CARRYING VALUE | ESTIMATED FAIR VALUE | |||||||||||
Financial instruments not marked-to-market: | |||||||||||||||
Cash and cash equivalents | $ | 2,743 | $ | 2,743 | $ | 23,368 | $ | 23,368 | |||||||
Restricted cash and cash equivalents | $ | 12,394 | $ | 12,394 | $ | 14,124 | $ | 14,124 | |||||||
Short-term debt, excluding debt issuance costs | $ | 3,000 | $ | 3,000 | $ | — | $ | — | |||||||
Long-term debt, excluding debt issuance costs | $ | 1,313,069 | $ | 1,430,061 | $ | 1,320,198 | $ | 1,554,674 |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
AT JUNE 30, 2013 | AT DEC. 31, 2012 | ||||||||||||||||||||||||||||||
(THOUSANDS) | AMORTIZED COST | TOTAL UNREALIZED GAINS (1) | TOTAL UNREALIZED LOSSES (1) | FAIR VALUE | AMORTIZED COST | TOTAL UNREALIZED GAINS (1) | TOTAL UNREALIZED LOSSES (1) | FAIR VALUE | |||||||||||||||||||||||
Municipal bonds | $ | 9,774 | $ | 3 | $ | 23 | $ | 9,754 | $ | 10,228 | $ | 3 | $ | 28 | $ | 10,203 | |||||||||||||||
Corporate bonds | 516 | — | 4 | 512 | — | — | — | — | |||||||||||||||||||||||
Commercial paper | 2,282 | — | — | 2,282 | 649 | — | — | 649 | |||||||||||||||||||||||
Total available-for-sale debt securities | $ | 12,572 | $ | 3 | $ | 27 | $ | 12,548 | $ | 10,877 | $ | 3 | $ | 28 | $ | 10,852 | |||||||||||||||
(1) Unrealized gains and losses are recorded to the restricted storm reserve. |
LESS THAN 12 MONTHS | 12 MONTHS OR LONGER | ||||||||||||||
(THOUSANDS) | AGGREGATE UNREALIZED LOSS | AGGREGATE RELATED FAIR VALUE | AGGREGATE UNREALIZED LOSS | AGGREGATE RELATED FAIR VALUE | |||||||||||
Municipal bonds | $ | 23 | $ | 5,528 | $ | — | $ | — | |||||||
Corporate bonds | 4 | 512 | — | — | |||||||||||
Total | $ | 27 | $ | 6,040 | $ | — | $ | — |
(THOUSANDS) | AT JUNE 30, 2013 | ||
One year or less | $ | 6,191 | |
Over one year through five years | 6,357 | ||
Total fair value | $ | 12,548 |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
Cleco | |||||||||||||||||||||||||||||||
CLECO CONSOLIDATED FAIR VALUE MEASUREMENTS AT REPORTING DATE USING: | |||||||||||||||||||||||||||||||
(THOUSANDS) | AT JUNE 30, 2013 | QUOTED PRICES IN ACTIVE MARKETS FOR IDENTICAL ASSETS (LEVEL 1) | SIGNIFICANT OTHER OBSERVABLE INPUTS (LEVEL 2) | SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3) | AT DEC. 31, 2012 | QUOTED PRICES IN ACTIVE MARKETS FOR IDENTICAL ASSETS (LEVEL 1) | SIGNIFICANT OTHER OBSERVABLE INPUTS (LEVEL 2) | SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3) | |||||||||||||||||||||||
Asset Description | |||||||||||||||||||||||||||||||
Institutional money market funds | $ | 18,672 | $ | — | $ | 18,672 | $ | — | $ | 39,489 | $ | — | $ | 39,489 | $ | — | |||||||||||||||
Municipal bonds | 9,754 | — | 9,754 | — | 10,203 | — | 10,203 | — | |||||||||||||||||||||||
Corporate bonds | 512 | — | 512 | — | — | — | — | — | |||||||||||||||||||||||
Total assets | $ | 28,938 | $ | — | $ | 28,938 | $ | — | $ | 49,692 | $ | — | $ | 49,692 | $ | — | |||||||||||||||
Liability Description | |||||||||||||||||||||||||||||||
Interest rate derivatives | $ | — | $ | — | $ | — | $ | — | $ | 2,627 | $ | — | $ | 2,627 | $ | — | |||||||||||||||
Long-term debt | 1,455,061 | — | 1,455,061 | — | 1,579,674 | — | 1,579,674 | — | |||||||||||||||||||||||
Total liabilities | $ | 1,455,061 | $ | — | $ | 1,455,061 | $ | — | $ | 1,582,301 | $ | — | $ | 1,582,301 | $ | — |
Cleco Power | |||||||||||||||||||||||||||||||
CLECO POWER FAIR VALUE MEASUREMENTS AT REPORTING DATE USING: | |||||||||||||||||||||||||||||||
(THOUSANDS) | AT JUNE 30, 2013 | QUOTED PRICES IN ACTIVE MARKETS FOR IDENTICAL ASSETS (LEVEL 1) | SIGNIFICANT OTHER OBSERVABLE INPUTS (LEVEL 2) | SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3) | AT DEC. 31, 2012 | QUOTED PRICES IN ACTIVE MARKETS FOR IDENTICAL ASSETS (LEVEL 1) | SIGNIFICANT OTHER OBSERVABLE INPUTS (LEVEL 2) | SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3) | |||||||||||||||||||||||
Asset Description | |||||||||||||||||||||||||||||||
Institutional money market funds | $ | 14,976 | $ | — | $ | 14,976 | $ | — | $ | 33,292 | $ | — | $ | 33,292 | $ | — | |||||||||||||||
Municipal bonds | 9,754 | — | 9,754 | — | 10,203 | — | 10,203 | — | |||||||||||||||||||||||
Corporate bonds | 512 | — | 512 | — | — | — | — | — | |||||||||||||||||||||||
Total assets | $ | 25,242 | $ | — | $ | 25,242 | $ | — | $ | 43,495 | $ | — | $ | 43,495 | $ | — | |||||||||||||||
Liability Description | |||||||||||||||||||||||||||||||
Interest rate derivatives | $ | — | $ | — | $ | — | $ | — | $ | 2,627 | $ | — | $ | 2,627 | $ | — | |||||||||||||||
Long-term debt | 1,430,061 | — | 1,430,061 | — | 1,554,674 | — | 1,554,674 | — | |||||||||||||||||||||||
Total liabilities | $ | 1,430,061 | $ | — | $ | 1,430,061 | $ | — | $ | 1,557,301 | $ | — | $ | 1,557,301 | $ | — |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
FOR THE THREE MONTHS ENDED JUNE 30, | |||||||||||||||
2013 | 2012 | ||||||||||||||
(THOUSANDS) | AMOUNT OF GAIN RECOGNIZED IN OCI | AMOUNT OF LOSS RECLASSIFIED FROM ACCUMULATED OCI INTO INCOME (EFFECTIVE PORTION) | AMOUNT OF LOSS RECOGNIZED IN OCI | AMOUNT OF LOSS RECLASSIFIED FROM ACCUMULATED OCI INTO INCOME (EFFECTIVE PORTION) | |||||||||||
Interest rate derivatives (1) | $ | — | $ | (59 | )* | $ | (6,191 | ) | $ | (57 | )* |
FOR THE SIX MONTHS ENDED JUNE 30, | |||||||||||||||
2013 | 2012 | ||||||||||||||
(THOUSANDS) | AMOUNT OF GAIN RECOGNIZED IN OCI | AMOUNT OF LOSS RECLASSIFIED FROM ACCUMULATED OCI INTO INCOME (EFFECTIVE PORTION) | AMOUNT OF LOSS RECOGNIZED IN OCI | AMOUNT OF LOSS RECLASSIFIED FROM ACCUMULATED OCI INTO INCOME (EFFECTIVE PORTION) | |||||||||||
Interest rate derivatives (1) | $ | 1,762 | $ | (79 | )* | $ | (1,535 | ) | $ | (57 | )* |
Note 5 — Debt |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
Note 6 — Pension Plan and Employee Benefits |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
PENSION BENEFITS | OTHER BENEFITS | ||||||||||||||
FOR THE THREE MONTHS ENDED JUNE 30, | |||||||||||||||
(THOUSANDS) | 2013 | 2012 | 2013 | 2012 | |||||||||||
Components of periodic benefit cost: | |||||||||||||||
Service cost | $ | 2,460 | $ | 2,007 | $ | 314 | $ | 397 | |||||||
Interest cost | 4,533 | 4,697 | 481 | 476 | |||||||||||
Expected return on plan assets | (5,958 | ) | (5,209 | ) | — | — | |||||||||
Amortizations: | |||||||||||||||
Transition obligation | — | — | 4 | 5 | |||||||||||
Prior period service cost (credit) | (18 | ) | (18 | ) | — | — | |||||||||
Net loss | 3,236 | 2,390 | 319 | 200 | |||||||||||
Net periodic benefit cost | $ | 4,253 | $ | 3,867 | $ | 1,118 | $ | 1,078 |
PENSION BENEFITS | OTHER BENEFITS | ||||||||||||||
FOR THE SIX MONTHS ENDED JUNE 30, | |||||||||||||||
(THOUSANDS) | 2013 | 2012 | 2013 | 2012 | |||||||||||
Components of periodic benefit cost: | |||||||||||||||
Service cost | $ | 4,945 | $ | 4,156 | $ | 628 | $ | 793 | |||||||
Interest cost | 8,970 | 9,127 | 962 | 953 | |||||||||||
Expected return on plan assets | (11,723 | ) | (10,403 | ) | — | — | |||||||||
Amortizations: | |||||||||||||||
Transition obligation | — | — | 8 | 10 | |||||||||||
Prior period service cost (credit) | (36 | ) | (36 | ) | — | — | |||||||||
Net loss | 6,609 | 4,173 | 637 | 400 | |||||||||||
Net periodic benefit cost | $ | 8,765 | $ | 7,017 | $ | 2,235 | $ | 2,156 |
FOR THE THREE MONTHS ENDED JUNE 30, | FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||||||||
(THOUSANDS) | 2013 | 2012 | 2013 | 2012 | |||||||||||
Components of periodic benefit cost: | |||||||||||||||
Service cost (credit) | $ | 521 | $ | (258 | ) | $ | 1,028 | $ | 744 | ||||||
Interest cost | 612 | 690 | 1,289 | 1,263 | |||||||||||
Amortizations: | |||||||||||||||
Prior period service cost | 13 | 13 | 27 | 27 | |||||||||||
Net loss | 616 | 573 | 1,152 | 882 | |||||||||||
Net periodic benefit cost | $ | 1,762 | $ | 1,018 | $ | 3,496 | $ | 2,916 |
FOR THE THREE MONTHS ENDED JUNE 30, | FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||||||||
(THOUSANDS) | 2013 | 2012 | 2013 | 2012 | |||||||||||
401(k) Plan expense | $ | 1,145 | $ | 847 | $ | 2,424 | $ | 2,341 |
Note 7 — Income Taxes |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
FOR THE THREE MONTHS ENDED JUNE 30, | FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||
Cleco | 31.6 | % | 30.5 | % | 32.0 | % | 30.7 | % | |||
Cleco Power | 34.3 | % | 35.5 | % | 34.1 | % | 35.3 | % |
(THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Interest payable | |||||||
Cleco | $ | 1,131 | $ | 1,420 | |||
Cleco Power | $ | 3,600 | $ | 3,358 |
FOR THE THREE MONTHS ENDED JUNE 30, | FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||||||||
(THOUSANDS) | 2013 | 2012 | 2013 | 2012 | |||||||||||
Interest charges | |||||||||||||||
Cleco | $ | (221 | ) | $ | (2,716 | ) | $ | (290 | ) | $ | (8,355 | ) | |||
Cleco Power | $ | 121 | $ | (2,271 | ) | $ | 242 | $ | (9,636 | ) |
Note 8 — Disclosures about Segments |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
SEGMENT INFORMATION FOR THE THREE MONTHS ENDED JUNE 30, | |||||||||||||||||||
2013 (THOUSANDS) | CLECO POWER | MIDSTREAM | OTHER | ELIMINATIONS | CONSOLIDATED | ||||||||||||||
Revenue | |||||||||||||||||||
Electric operations | $ | 252,765 | $ | — | $ | — | $ | — | $ | 252,765 | |||||||||
Tolling operations | — | 9,307 | — | (9,307 | ) | — | |||||||||||||
Other operations | 11,027 | — | 504 | — | 11,531 | ||||||||||||||
Electric customer credits | (402 | ) | — | — | — | (402 | ) | ||||||||||||
Affiliate revenue | 335 | — | 15,168 | (15,503 | ) | — | |||||||||||||
Operating revenue, net | $ | 263,725 | $ | 9,307 | $ | 15,672 | $ | (24,810 | ) | $ | 263,894 | ||||||||
Depreciation | $ | 32,959 | $ | 1,501 | $ | 280 | $ | — | $ | 34,740 | |||||||||
Interest charges | $ | 20,878 | $ | (411 | ) | $ | 281 | $ | 140 | $ | 20,888 | ||||||||
Interest income | $ | 255 | $ | — | $ | (138 | ) | $ | 140 | $ | 257 | ||||||||
Federal and state income tax expense (benefit) | $ | 17,965 | $ | 3,979 | $ | (2,521 | ) | $ | (1 | ) | $ | 19,422 | |||||||
Net income | $ | 34,464 | $ | 6,350 | $ | 1,218 | $ | — | $ | 42,032 | |||||||||
Additions to long-lived assets | $ | 44,588 | $ | 497 | $ | 710 | $ | — | $ | 45,795 | |||||||||
Equity investment in investees | $ | 14,532 | $ | — | $ | 8 | $ | 1 | $ | 14,541 | |||||||||
Total segment assets | $ | 3,871,862 | $ | 212,595 | $ | 146,538 | $ | (114,859 | ) | $ | 4,116,136 |
2012 (THOUSANDS) | CLECO POWER | MIDSTREAM | OTHER | ELIMINATIONS | CONSOLIDATED | ||||||||||||||
Revenue | |||||||||||||||||||
Electric operations | $ | 228,293 | $ | — | $ | — | $ | — | $ | 228,293 | |||||||||
Tolling operations | — | 6,309 | — | (6,309 | ) | — | |||||||||||||
Other operations | 11,613 | 1 | 497 | — | 12,111 | ||||||||||||||
Electric customer credits | (281 | ) | — | — | — | (281 | ) | ||||||||||||
Affiliate revenue | 342 | — | 13,590 | (13,932 | ) | $ | — | ||||||||||||
Operating revenue, net | $ | 239,967 | $ | 6,310 | $ | 14,087 | $ | (20,241 | ) | $ | 240,123 | ||||||||
Depreciation | $ | 30,559 | $ | 1,460 | $ | 232 | $ | (1 | ) | $ | 32,250 | ||||||||
Interest charges | $ | 20,805 | $ | (1,159 | ) | $ | 824 | $ | 146 | $ | 20,616 | ||||||||
Interest income | $ | (6 | ) | $ | — | $ | (141 | ) | $ | 144 | $ | (3 | ) | ||||||
Federal and state income tax expense (benefit) | $ | 20,501 | $ | 4,051 | $ | (4,031 | ) | $ | (1 | ) | $ | 20,520 | |||||||
Net income | $ | 37,284 | $ | 6,534 | $ | 2,868 | $ | — | $ | 46,686 | |||||||||
Additions to long-lived assets | $ | 55,785 | $ | 6,025 | $ | 482 | $ | — | $ | 62,292 | |||||||||
Equity investment in investees (1) | $ | 14,532 | $ | — | $ | 8 | $ | — | $ | 14,540 | |||||||||
Total segment assets (1) | $ | 3,871,729 | $ | 215,342 | $ | 201,678 | $ | (141,400 | ) | $ | 4,147,349 | ||||||||
(1) Balances as of December 31, 2012 |
SEGMENT INFORMATION FOR THE SIX MONTHS ENDED JUNE 30, | |||||||||||||||||||
2013 (THOUSANDS) | CLECO POWER | MIDSTREAM | OTHER | ELIMINATIONS | CONSOLIDATED | ||||||||||||||
Revenue | |||||||||||||||||||
Electric operations | $ | 482,191 | $ | — | $ | — | $ | — | $ | 482,191 | |||||||||
Tolling operations | — | 14,144 | — | (14,144 | ) | — | |||||||||||||
Other operations | 22,064 | 1 | 1,008 | 1 | 23,074 | ||||||||||||||
Electric customer credits | (424 | ) | — | — | — | (424 | ) | ||||||||||||
Affiliate revenue | 670 | — | 27,093 | (27,763 | ) | — | |||||||||||||
Operating revenue | $ | 504,501 | $ | 14,145 | $ | 28,101 | $ | (41,906 | ) | $ | 504,841 | ||||||||
Depreciation | $ | 65,288 | $ | 3,001 | $ | 483 | $ | 1 | $ | 68,773 | |||||||||
Interest charges | $ | 42,227 | $ | (649 | ) | $ | 444 | $ | 322 | $ | 42,344 | ||||||||
Interest income | $ | 453 | $ | — | $ | (318 | ) | $ | 322 | $ | 457 | ||||||||
Federal and state income tax expense (benefit) | $ | 32,203 | $ | 3,139 | $ | (2,839 | ) | $ | — | $ | 32,503 | ||||||||
Net income | $ | 62,257 | $ | 5,016 | $ | 1,893 | $ | — | $ | 69,166 | |||||||||
Additions to long-lived assets | $ | 86,147 | $ | 2,326 | $ | 1,271 | $ | — | $ | 89,744 | |||||||||
Equity investment in investees | $ | 14,532 | $ | — | $ | 8 | $ | 1 | $ | 14,541 | |||||||||
Total segment assets | $ | 3,871,862 | $ | 212,595 | $ | 146,538 | $ | (114,859 | ) | $ | 4,116,136 |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
2012 (THOUSANDS) | CLECO POWER | MIDSTREAM | OTHER | ELIMINATIONS | CONSOLIDATED | ||||||||||||||
Revenue | |||||||||||||||||||
Electric operations | $ | 437,883 | $ | — | $ | — | $ | — | $ | 437,883 | |||||||||
Tolling operations | — | 7,543 | — | (7,543 | ) | — | |||||||||||||
Other operations | 22,062 | 1 | 994 | (1 | ) | 23,056 | |||||||||||||
Electric customer credits | 1,955 | — | — | — | 1,955 | ||||||||||||||
Affiliate revenue | 687 | — | 25,197 | (25,884 | ) | — | |||||||||||||
Operating revenue | $ | 462,587 | $ | 7,544 | $ | 26,191 | $ | (33,428 | ) | $ | 462,894 | ||||||||
Depreciation | $ | 60,648 | $ | 2,992 | $ | 456 | $ | 1 | $ | 64,097 | |||||||||
Interest charges | $ | 39,291 | $ | 313 | $ | 1,444 | $ | 192 | $ | 41,240 | |||||||||
Interest income | $ | 23 | $ | — | $ | (185 | ) | $ | 193 | $ | 31 | ||||||||
Equity income from investees, before tax | $ | — | $ | — | $ | 1 | $ | — | $ | 1 | |||||||||
Federal and state income tax expense (benefit) | $ | 35,008 | $ | 4,789 | $ | (5,866 | ) | $ | (1 | ) | $ | 33,930 | |||||||
Net income | $ | 64,089 | $ | 7,624 | $ | 5,004 | $ | 1 | $ | 76,718 | |||||||||
Additions to long-lived assets | $ | 94,762 | $ | 6,012 | $ | 869 | $ | — | $ | 101,643 | |||||||||
Equity investment in investees (1) | $ | 14,532 | $ | — | $ | 8 | $ | — | $ | 14,540 | |||||||||
Total segment assets (1) | $ | 3,871,729 | $ | 215,342 | $ | 201,678 | $ | (141,400 | ) | $ | 4,147,349 | ||||||||
(1) Balances as of December 31, 2012 |
Note 9 — Electric Customer Credits |
Note 10 — Variable Interest Entities |
INCEPTION TO DATE (THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Purchase price | $ | 12,873 | $ | 12,873 | |||
Cash contributions | 1,659 | 1,659 | |||||
Total equity investment in investee | $ | 14,532 | $ | 14,532 |
(THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Oxbow’s net assets/liabilities | $ | 29,065 | $ | 29,065 | |||
Cleco Power’s 50% equity | $ | 14,532 | $ | 14,532 | |||
Cleco’s maximum exposure to loss | $ | 14,532 | $ | 14,532 |
(THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Current assets | $ | 2,039 | $ | 1,814 | |||
Property, plant, and equipment, net | 22,823 | 23,029 | |||||
Other assets | 4,661 | 4,248 | |||||
Total assets | $ | 29,523 | $ | 29,091 | |||
Current liabilities | $ | 458 | $ | 26 | |||
Partners’ capital | 29,065 | 29,065 | |||||
Total liabilities and partners’ capital | $ | 29,523 | $ | 29,091 |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
FOR THE THREE MONTHS ENDED JUNE 30, | FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||||||||
(THOUSANDS) | 2013 | 2012 | 2013 | 2012 | |||||||||||
Operating revenue | $ | 510 | $ | 294 | $ | 939 | $ | 676 | |||||||
Operating expenses | 510 | 294 | 939 | 676 | |||||||||||
Income before taxes | $ | — | $ | — | $ | — | $ | — |
Note 11 — Litigation, Other Commitments and Contingencies, and Disclosures about Guarantees |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
AT JUNE 30, 2013 | |||||||||||
(THOUSANDS) | FACE AMOUNT | REDUCTIONS | NET AMOUNT | ||||||||
Cleco Corporation | |||||||||||
Guarantee issued to Entergy Mississippi on behalf of Attala | $ | 500 | $ | — | $ | 500 | |||||
Cleco Power | |||||||||||
Obligations under standby letter of credit issued to the Louisiana Department of Labor | 3,725 | — | 3,725 | ||||||||
Total | $ | 4,225 | $ | — | $ | 4,225 |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
AT JUNE 30, 2013 | |||||||||||||||||||
AMOUNT OF COMMITMENT EXPIRATION PER PERIOD | |||||||||||||||||||
(THOUSANDS) | NET AMOUNT COMMITTED | LESS THAN ONE YEAR | 1-3 YEARS | 3-5 YEARS | MORE THAN 5 YEARS | ||||||||||||||
Off-balance sheet commitments | $ | 4,225 | $ | 3,725 | $ | — | $ | — | $ | 500 | |||||||||
On-balance sheet guarantees | 4,956 | 950 | — | — | 4,006 | ||||||||||||||
Total | $ | 9,181 | $ | 4,675 | $ | — | $ | — | $ | 4,506 |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
(THOUSANDS) | CONTRIBUTION | ||
Six months ending Dec. 31, 2013 | $ | 26,876 | |
Years ending Dec. 31, | |||
2014 | 43,407 | ||
2015 | 11,870 | ||
2016 | 7,307 | ||
2017 | 2,865 | ||
Total | $ | 92,325 |
(THOUSANDS) | |||
Equity contributions, imputed interest rate 6% | |||
Principal payment schedule above: | $ | 92,325 | |
Less: unamortized discount | 6,724 | ||
Total | $ | 85,601 |
Note 12 — Affiliate Transactions |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
AT JUNE 30, 2013 | AT DEC. 31, 2012 | ||||||||||||||
(THOUSANDS) | ACCOUNTS RECEIVABLE | ACCOUNTS PAYABLE | ACCOUNTS RECEIVABLE | ACCOUNTS PAYABLE | |||||||||||
Cleco Corporation | $ | 76 | $ | 293 | $ | 139 | $ | 1,140 | |||||||
Support Group | 681 | 6,510 | 2,777 | 7,528 | |||||||||||
Midstream | 30 | 27 | 27 | 5 | |||||||||||
Evangeline | 3 | 4,543 | 6 | 1,401 | |||||||||||
Diversified Lands | 5 | — | 42 | 23 | |||||||||||
Other (1) | 1 | — | — | — | |||||||||||
Total | $ | 796 | $ | 11,373 | $ | 2,991 | $ | 10,097 | |||||||
(1) Represents Perryville and Attala |
Note 13 — Storm Restoration |
Note 14 — Accumulated Other Comprehensive Loss |
Cleco | |||||||||||
FOR THE THREE MONTHS ENDED JUNE 30, 2013 | |||||||||||
(THOUSANDS) | POSTRETIREMENT BENEFIT NET (LOSS) GAIN | NET (LOSS) GAIN ON CASH FLOW HEDGES | TOTAL ACCUMULATED OTHER COMPREHENSIVE (LOSS) GAIN | ||||||||
Balances, Mar. 31, 2013 | $ | (24,205 | ) | $ | (6,292 | ) | $ | (30,497 | ) | ||
Amounts reclassified from accumulated other comprehensive income: | |||||||||||
Amortization of postretirement benefit net loss | 586 | — | 586 | ||||||||
Reclassification of net loss to interest charges | — | 36 | 36 | ||||||||
Net current-period other comprehensive income | 586 | 36 | 622 | ||||||||
Balances, June 30, 2013 | $ | (23,619 | ) | $ | (6,256 | ) | $ | (29,875 | ) |
FOR THE SIX MONTHS ENDED JUNE 30, 2013 | |||||||||||
(THOUSANDS) | POSTRETIREMENT BENEFIT NET (LOSS) GAIN | NET (LOSS) GAIN ON CASH FLOW HEDGES | TOTAL ACCUMULATED OTHER COMPREHENSIVE (LOSS) GAIN | ||||||||
Balances, Dec. 31, 2012 | $ | (24,741 | ) | $ | (7,629 | ) | $ | (32,370 | ) | ||
Other comprehensive income before reclassifications: | |||||||||||
Net derivative gain | — | 1,355 | 1,355 | ||||||||
Amounts reclassified from accumulated other comprehensive income: | |||||||||||
Amortization of postretirement benefit net loss | 1,122 | — | 1,122 | ||||||||
Reclassification of net loss to interest charges | — | 49 | 49 | ||||||||
Reclassification of ineffectiveness to regulatory asset | — | (31 | ) | (31 | ) | ||||||
Net current-period other comprehensive income | 1,122 | 1,373 | 2,495 | ||||||||
Balances, June 30, 2013 | $ | (23,619 | ) | $ | (6,256 | ) | $ | (29,875 | ) |
Cleco Power | |||||||||||
FOR THE THREE MONTHS ENDED JUNE 30, 2013 | |||||||||||
(THOUSANDS) | POSTRETIREMENT BENEFIT NET (LOSS) GAIN | NET (LOSS) GAIN ON CASH FLOW HEDGES | TOTAL ACCUMULATED OTHER COMPREHENSIVE (LOSS) GAIN | ||||||||
Balances, Mar. 31, 2013 | $ | (12,541 | ) | $ | (6,292 | ) | $ | (18,833 | ) | ||
Amounts reclassified from accumulated other comprehensive income: | |||||||||||
Amortization of postretirement benefit net loss | 269 | — | 269 | ||||||||
Reclassification of net loss to interest charges | — | 36 | 36 | ||||||||
Net current-period other comprehensive income | 269 | 36 | 305 | ||||||||
Balances, June 30, 2013 | $ | (12,272 | ) | $ | (6,256 | ) | $ | (18,528 | ) |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
FOR THE SIX MONTHS ENDED JUNE 30, 2013 | |||||||||||
(THOUSANDS) | POSTRETIREMENT BENEFIT NET (LOSS) GAIN | NET (LOSS) GAIN ON CASH FLOW HEDGES | TOTAL ACCUMULATED OTHER COMPREHENSIVE (LOSS) GAIN | ||||||||
Balances, Dec. 31, 2012 | $ | (12,792 | ) | $ | (7,629 | ) | $ | (20,421 | ) | ||
Other comprehensive income before reclassifications: | |||||||||||
Net derivative gain | — | 1,355 | 1,355 | ||||||||
Amounts reclassified from accumulated other comprehensive income: | |||||||||||
Amortization of postretirement benefit net loss | 520 | — | 520 | ||||||||
Reclassification of net loss to interest charges | — | 49 | 49 | ||||||||
Reclassification of ineffectiveness to regulatory asset | — | (31 | ) | (31 | ) | ||||||
Net current-period other comprehensive income | 520 | 1,373 | 1,893 | ||||||||
Balances, June 30, 2013 | $ | (12,272 | ) | $ | (6,256 | ) | $ | (18,528 | ) |
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
RESULTS OF OPERATIONS |
• | Cleco Power, a regulated electric utility company, which owns 9 generating units with a total nameplate capacity of 2,565 MW and serves approximately 283,000 customers in Louisiana through its retail business and 10 communities across Louisiana and Mississippi through wholesale power contracts and |
• | Midstream, a wholesale energy business, which owns Evangeline (which operates Coughlin). |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
Cleco Consolidated | ||||||||||||||
FOR THE THREE MONTHS ENDED JUNE 30, | ||||||||||||||
FAVORABLE/(UNFAVORABLE) | ||||||||||||||
(THOUSANDS) | 2013 | 2012 | VARIANCE | CHANGE | ||||||||||
Operating revenue, net | $ | 263,894 | $ | 240,123 | $ | 23,771 | 9.9 | % | ||||||
Operating expenses | 189,140 | 165,880 | (23,260 | ) | (14.0 | )% | ||||||||
Operating income | $ | 74,754 | $ | 74,243 | $ | 511 | 0.7 | % | ||||||
Allowance for other funds used during construction | $ | 413 | $ | 1,399 | $ | (986 | ) | (70.5 | )% | |||||
Other income | $ | 8,165 | $ | 13,014 | $ | (4,849 | ) | (37.3 | )% | |||||
Federal and state income taxes | $ | 19,422 | $ | 20,520 | $ | 1,098 | 5.4 | % | ||||||
Net income applicable to common stock | $ | 42,032 | $ | 46,686 | $ | (4,654 | ) | (10.0 | )% |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
Cleco Power | ||||||||||||||
FOR THE THREE MONTHS ENDED JUNE 30, | ||||||||||||||
FAVORABLE/(UNFAVORABLE) | ||||||||||||||
(THOUSANDS) | 2013 | 2012 | VARIANCE | CHANGE | ||||||||||
Operating revenue | ||||||||||||||
Base | $ | 160,031 | $ | 156,192 | $ | 3,839 | 2.5 | % | ||||||
Fuel cost recovery | 92,734 | 72,101 | 20,633 | 28.6 | % | |||||||||
Electric customer credits | (402 | ) | (281 | ) | (121 | ) | (43.1 | )% | ||||||
Other operations | 11,027 | 11,613 | (586 | ) | (5.0 | )% | ||||||||
Affiliate revenue | 335 | 342 | (7 | ) | (2.0 | )% | ||||||||
Operating revenue, net | 263,725 | 239,967 | 23,758 | 9.9 | % | |||||||||
Operating expenses | ||||||||||||||
Recoverable fuel used for electric generation | 71,907 | 54,205 | (17,702 | ) | (32.7 | )% | ||||||||
Recoverable power purchased for utility customers | 20,826 | 17,899 | (2,927 | ) | (16.4 | )% | ||||||||
FAC non-recoverable fuel and power purchased | 3,125 | 4,958 | 1,833 | 37.0 | % | |||||||||
Other operations | 29,540 | 27,243 | (2,297 | ) | (8.4 | )% | ||||||||
Maintenance | 23,585 | 19,630 | (3,955 | ) | (20.1 | )% | ||||||||
Depreciation | 32,959 | 30,559 | (2,400 | ) | (7.9 | )% | ||||||||
Taxes other than income taxes | 9,204 | 8,682 | (522 | ) | (6.0 | )% | ||||||||
Gain on sale of assets | — | (1 | ) | (1 | ) | (100.0 | )% | |||||||
Total operating expenses | 191,146 | 163,175 | (27,971 | ) | (17.1 | )% | ||||||||
Operating income | $ | 72,579 | $ | 76,792 | $ | (4,213 | ) | (5.5 | )% | |||||
Allowance for other funds used during construction | $ | 413 | $ | 1,399 | $ | (986 | ) | (70.5 | )% | |||||
Federal and state income taxes | $ | 17,965 | $ | 20,501 | $ | 2,536 | 12.4 | % | ||||||
Net income | $ | 34,464 | $ | 37,284 | $ | (2,820 | ) | (7.6 | )% |
• | higher other operations and maintenance expenses, |
• | higher depreciation expenses, |
• | lower allowance for other funds used during construction, |
• | lower other operations revenue, and |
• | higher taxes other than income taxes. |
• | higher base revenue, |
• | lower income taxes, and |
• | lower FAC non-recoverable fuel and power purchased. |
FOR THE THREE MONTHS ENDED JUNE 30, | ||||||||
(MILLION kWh) | 2013 | 2012 | FAVORABLE/ (UNFAVORABLE) | |||||
Electric sales | ||||||||
Residential | 801 | 848 | (5.5 | )% | ||||
Commercial | 632 | 667 | (5.2 | )% | ||||
Industrial | 575 | 578 | (0.5 | )% | ||||
Other retail | 33 | 33 | — | % | ||||
Total retail | 2,041 | 2,126 | (4.0 | )% | ||||
Sales for resale | 498 | 466 | 6.9 | % | ||||
Unbilled | 215 | 168 | 28.0 | % | ||||
Total retail and wholesale customer sales | 2,754 | 2,760 | (0.2 | )% |
FOR THE THREE MONTHS ENDED JUNE 30, | ||||||||||
(THOUSANDS) | 2013 | 2012 | FAVORABLE/ (UNFAVORABLE) | |||||||
Electric sales | ||||||||||
Residential | $ | 64,815 | $ | 66,150 | (2.0 | )% | ||||
Commercial | 44,679 | 44,317 | 0.8 | % | ||||||
Industrial | 22,061 | 21,132 | 4.4 | % | ||||||
Other retail | 2,494 | 2,407 | 3.6 | % | ||||||
Surcharge | 2,054 | 2,036 | 0.9 | % | ||||||
Other | (1,566 | ) | (1,566 | ) | — | % | ||||
Total retail | 134,537 | 134,476 | — | % | ||||||
Sales for resale | 13,299 | 11,710 | 13.6 | % | ||||||
Unbilled | 12,195 | 10,006 | 21.9 | % | ||||||
Total retail and wholesale customer sales | $ | 160,031 | $ | 156,192 | 2.5 | % |
FOR THE THREE MONTHS ENDED JUNE 30, | ||||||||||||||
2013 CHANGE | ||||||||||||||
2013 | 2012 | NORMAL | PRIOR YEAR | NORMAL | ||||||||||
Cooling-degree days | 952 | 1,143 | 942 | (16.7 | )% | 1.1 | % |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
Midstream | ||||||||||||||
FOR THE THREE MONTHS ENDED JUNE 30, | ||||||||||||||
FAVORABLE/(UNFAVORABLE) | ||||||||||||||
(THOUSANDS) | 2013 | 2012 | VARIANCE | CHANGE | ||||||||||
Operating revenue | ||||||||||||||
Tolling operations | $ | 9,307 | $ | 6,309 | $ | 2,998 | 47.5 | % | ||||||
Other operations | — | 1 | (1 | ) | (100.0 | )% | ||||||||
Operating revenue | 9,307 | 6,310 | 2,997 | 47.5 | % | |||||||||
Operating expenses | ||||||||||||||
Fuel used for electric generation | — | 304 | 304 | 100.0 | % | |||||||||
Power purchased for utility customers | — | 9 | 9 | 100.0 | % | |||||||||
Other operations | 1,846 | 1,873 | 27 | 1.4 | % | |||||||||
Maintenance | 2,503 | 4,452 | 1,949 | 43.8 | % | |||||||||
Depreciation | 1,501 | 1,460 | (41 | ) | (2.8 | )% | ||||||||
Taxes other than income taxes | 623 | 612 | (11 | ) | (1.8 | )% | ||||||||
Gain on sale of assets | (188 | ) | (21 | ) | 167 | 795.2 | % | |||||||
Total operating expenses | 6,285 | 8,689 | 2,404 | 27.7 | % | |||||||||
Operating income (loss) | $ | 3,022 | $ | (2,379 | ) | $ | 5,401 | 227.0 | % | |||||
Other income | $ | 6,900 | $ | 11,809 | $ | (4,909 | ) | (41.6 | )% | |||||
Interest charges | $ | (411 | ) | $ | (1,159 | ) | $ | (748 | ) | (64.5 | )% | |||
Federal and state income tax expense | $ | 3,979 | $ | 4,051 | $ | 72 | 1.8 | % | ||||||
Net income | $ | 6,350 | $ | 6,534 | $ | (184 | ) | (2.8 | )% |
Cleco Consolidated | ||||||||||||||
FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||||||||
FAVORABLE/(UNFAVORABLE) | ||||||||||||||
(THOUSANDS) | 2013 | 2012 | VARIANCE | CHANGE | ||||||||||
Operating revenue, net | $ | 504,841 | $ | 462,894 | $ | 41,947 | 9.1 | % | ||||||
Operating expenses | 371,617 | 334,357 | (37,260 | ) | (11.1 | )% | ||||||||
Operating income | $ | 133,224 | $ | 128,537 | $ | 4,687 | 3.6 | % | ||||||
Allowance for other funds used during construction | $ | 1,577 | $ | 2,416 | $ | (839 | ) | (34.7 | )% | |||||
Other income | $ | 10,438 | $ | 22,389 | $ | (11,951 | ) | (53.4 | )% | |||||
Interest charges | $ | 42,344 | $ | 41,240 | $ | (1,104 | ) | (2.7 | )% | |||||
Federal and state income taxes | $ | 32,503 | $ | 33,930 | $ | 1,427 | 4.2 | % | ||||||
Net income applicable to common stock | $ | 69,166 | $ | 76,718 | $ | (7,552 | ) | (9.8 | )% |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
Cleco Power | ||||||||||||||
FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||||||||
FAVORABLE/(UNFAVORABLE) | ||||||||||||||
(THOUSANDS) | 2013 | 2012 | VARIANCE | CHANGE | ||||||||||
Operating revenue | ||||||||||||||
Base | $ | 298,234 | $ | 285,524 | $ | 12,710 | 4.5 | % | ||||||
Fuel cost recovery | 183,957 | 152,359 | 31,598 | 20.7 | % | |||||||||
Electric customer credits | (424 | ) | 1,955 | (2,379 | ) | (121.7 | )% | |||||||
Other operations | 22,064 | 22,062 | 2 | — | % | |||||||||
Affiliate revenue | 670 | 687 | (17 | ) | (2.5 | )% | ||||||||
Operating revenue, net | 504,501 | 462,587 | 41,914 | 9.1 | % | |||||||||
Operating expenses | ||||||||||||||
Recoverable fuel used for electric generation | 156,442 | 126,883 | (29,559 | ) | (23.3 | )% | ||||||||
Recoverable power purchased for utility customers | 27,517 | 25,479 | (2,038 | ) | (8.0 | )% | ||||||||
FAC non-recoverable fuel and power purchased | 6,957 | 7,636 | 679 | 8.9 | % | |||||||||
Other operations | 54,912 | 53,585 | (1,327 | ) | (2.5 | )% | ||||||||
Maintenance | 38,379 | 35,644 | (2,735 | ) | (7.7 | )% | ||||||||
Depreciation | 65,288 | 60,648 | (4,640 | ) | (7.7 | )% | ||||||||
Taxes other than income taxes | 20,662 | 17,614 | (3,048 | ) | (17.3 | )% | ||||||||
Gain on sale of assets | — | (1 | ) | (1 | ) | (100.0 | )% | |||||||
Total operating expenses | 370,157 | 327,488 | (42,669 | ) | (13.0 | )% | ||||||||
Operating income | $ | 134,344 | $ | 135,099 | $ | (755 | ) | (0.6 | )% | |||||
Allowance for other funds used during construction | $ | 1,577 | $ | 2,416 | $ | (839 | ) | (34.7 | )% | |||||
Interest charges | $ | 42,227 | $ | 39,291 | $ | (2,936 | ) | (7.5 | )% | |||||
Federal and state income taxes | $ | 32,203 | $ | 35,008 | $ | 2,805 | 8.0 | % | ||||||
Net income | $ | 62,257 | $ | 64,089 | $ | (1,832 | ) | (2.9 | )% |
• | higher depreciation expense, |
• | higher other operations and maintenance expenses, |
• | higher taxes other than income taxes, |
• | higher interest charges, |
• | higher electric customer credits, and |
• | lower allowance for other funds used during construction. |
• | higher base revenue, |
• | lower income taxes, and |
• | lower FAC non-recoverable fuel and power purchased. |
FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||
(Million kWh) | 2013 | 2012 | FAVORABLE/ (UNFAVORABLE) | |||||
Electric sales | ||||||||
Residential | 1,642 | 1,632 | 0.6 | % | ||||
Commercial | 1,214 | 1,237 | (1.9 | )% | ||||
Industrial | 1,130 | 1,128 | 0.2 | % | ||||
Other retail | 65 | 65 | — | % | ||||
Total retail | 4,051 | 4,062 | (0.3 | )% | ||||
Sales for resale | 939 | 856 | 9.7 | % | ||||
Unbilled | 152 | 80 | 90.0 | % | ||||
Total retail and wholesale customer sales | 5,142 | 4,998 | 2.9 | % |
FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||||
(THOUSANDS) | 2013 | 2012 | FAVORABLE/ (UNFAVORABLE) | |||||||
Electric sales | ||||||||||
Residential | $ | 126,515 | $ | 122,540 | 3.2 | % | ||||
Commercial | 88,728 | 86,064 | 3.1 | % | ||||||
Industrial | 43,186 | 41,224 | 4.8 | % | ||||||
Other retail | 5,061 | 4,767 | 6.2 | % | ||||||
Surcharge | 4,291 | 4,851 | (11.5 | )% | ||||||
Other | (3,131 | ) | (3,120 | ) | (0.4 | )% | ||||
Total retail | 264,650 | 256,326 | 3.2 | % | ||||||
Sales for resale | 25,577 | 23,495 | 8.9 | % | ||||||
Unbilled | 8,007 | 5,703 | 40.4 | % | ||||||
Total retail and wholesale customer sales | $ | 298,234 | $ | 285,524 | 4.5 | % |
FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||||||||
2013 CHANGE | ||||||||||||||
2013 | 2012 | NORMAL | PRIOR YEAR | NORMAL | ||||||||||
Heating-degree days | 874 | 500 | 948 | 74.8 | % | (7.8 | )% | |||||||
Cooling-degree days | 1,016 | 1,394 | 1,021 | (27.1 | )% | (0.5 | )% |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
Midstream | ||||||||||||||
FOR THE SIX MONTHS ENDED JUNE 30, | ||||||||||||||
FAVORABLE/(UNFAVORABLE) | ||||||||||||||
(THOUSANDS) | 2013 | 2012 | VARIANCE | CHANGE | ||||||||||
Operating revenue | ||||||||||||||
Tolling operations | $ | 14,144 | $ | 7,543 | $ | 6,601 | 87.5 | % | ||||||
Other operations | 1 | 1 | — | — | % | |||||||||
Operating revenue | 14,145 | 7,544 | 6,601 | 87.5 | % | |||||||||
Operating expenses | ||||||||||||||
Fuel used for electric generation | — | 304 | 304 | 100.0 | % | |||||||||
Power purchased for utility customers | — | 9 | 9 | 100.0 | % | |||||||||
Other operations | 3,569 | 3,656 | 87 | 2.4 | % | |||||||||
Maintenance | 5,165 | 5,625 | 460 | 8.2 | % | |||||||||
Depreciation | 3,001 | 2,992 | (9 | ) | (0.3 | )% | ||||||||
Taxes other than income taxes | 1,251 | 1,284 | 33 | 2.6 | % | |||||||||
Loss (gain) on sale of assets | 846 | (43 | ) | (889 | ) | * | ||||||||
Total operating expenses | 13,832 | 13,827 | (5 | ) | — | % | ||||||||
Operating income (loss) | $ | 313 | $ | (6,283 | ) | $ | 6,596 | 105.0 | % | |||||
Other income | $ | 7,200 | $ | 19,016 | $ | (11,816 | ) | (62.1 | )% | |||||
Interest charges | $ | (649 | ) | $ | 313 | $ | 962 | 307.3 | % | |||||
Federal and state income tax expense | $ | 3,139 | $ | 4,789 | $ | 1,650 | 34.5 | % | ||||||
Net income | $ | 5,016 | $ | 7,624 | $ | (2,608 | ) | (34.2 | )% | |||||
* Not meaningful |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
FINANCIAL CONDITION |
SENIOR UNSECURED DEBT | CORPORATE CREDIT | ||||
MOODY’S | S&P | S&P | |||
Cleco Corporation | Baa3 | N/A | *BBB | ||
Cleco Power | Baa2 | *BBB | N/A |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
(THOUSANDS) | AT JUNE 30, 2013 | AT DEC. 31, 2012 | |||||
Diversified Lands’ mitigation escrow | $ | 97 | $ | 97 | |||
Cleco Katrina/Rita’s storm recovery bonds | 8,067 | 8,781 | |||||
Cleco Power’s future storm restoration costs | 4,326 | 5,343 | |||||
Total restricted cash and cash equivalents | $ | 12,490 | $ | 14,221 |
• | a $97.1 million net increase in current tax liabilities and uncertain tax positions and related interest charges expected to be settled in the next 12 months and |
• | a $23.5 million decrease in unrestricted cash and cash equivalents as discussed above. |
• | a $74.5 million decrease in long-term debt due within one year which reflects the refinancing of long-term debt, |
• | a $9.4 million increase in customer accounts receivable, |
• | an $8.7 million decrease in accounts payable primarily due to payments of ad valorem tax, employee incentives and fuel that were accrued at year end, |
• | an $8.3 million decrease in regulatory liabilities due to the return of customer owed carrying costs related to the construction of Madison Unit 3, |
• | a $7.4 million increase in unbilled revenue, and |
• | a $6.4 million increase in fuel inventory. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
• | a $74.5 million decrease in long-term debt due within one year which reflects the refinancing of long-term debt, |
• | a $9.4 million increase in customer accounts receivable, |
• | an $8.3 million decrease in regulatory liabilities due to the return of customer owed carrying costs related to the construction of Madison Unit 3, |
• | a $7.4 million increase in unbilled revenue, |
• | a $6.4 million increase in fuel inventory, and |
• | a $3.2 million decrease in accounts payable primarily due to payments of ad valorem tax, employee incentive and fuel that were accrued at year end. |
• | a $49.9 million net increase in current tax liabilities and uncertain tax positions and related interest charges expected to be settled in the next 12 months and |
• | a $20.6 million decrease in unrestricted cash and cash equivalents, as discussed above. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
• | higher income tax refunds of $45.8 million, |
• | lower vendor payments of $13.6 million, |
• | lower refund of Madison Unit 3 carrying costs of $5.9 million due to extinguishment of the liability, |
• | lower payroll of $5.8 million, and |
• | lower payments for power purchases of $2.7 million. |
• | lower vendor payments of $13.8 million, |
• | lower refund of Madison Unit 3 carrying costs of $5.9 million due to extinguishment of the liability, |
• | lower payroll of $4.0 million, and |
• | lower payments for power purchases of $2.7 million. |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CRITICAL ACCOUNTING POLICIES |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
CLECO POWER — NARRATIVE ANALYSIS OF RESULTS OF OPERATIONS |
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
Risk Overview |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
Cleco Power |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
ITEM 4. CONTROLS AND PROCEDURES |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
PART II — OTHER INFORMATION |
ITEM 1. LEGAL PROCEEDINGS |
CLECO |
CLECO POWER |
ITEM 1A. RISK FACTORS |
ITEM 4. MINE SAFETY DISCLOSURES |
ITEM 5. OTHER INFORMATION |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
ITEM 6. EXHIBITS | |
CLECO CORPORATION | |
3.1 | Bylaws of Cleco Corporation, revised effective June 13, 2013 |
12(a) | Computation of Ratios of Earnings to Fixed Charges for the three-, six-, and twelve-month periods ended June 30, 2013, for Cleco Corporation |
31.1 | CEO Certification in accordance with section 302 of the Sarbanes-Oxley Act of 2002 |
31.2 | CFO Certification in accordance with section 302 of the Sarbanes-Oxley Act of 2002 |
32.1 | CEO Certification pursuant to section 906 of the Sarbanes-Oxley Act of 2002 |
32.2 | CFO Certification pursuant to section 906 of the Sarbanes-Oxley Act of 2002 |
95 | Mine Safety Disclosures |
101.INS | XBRL Instance Document |
101.SCH | XBRL Taxonomy Extension Schema |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase |
101.DEF | XBRL Taxonomy Extension Definition Linkbase |
101.LAB | XBRL Taxonomy Extension Label Linkbase |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase |
CLECO POWER | |
12(b) | Computation of Ratios of Earnings to Fixed Charges for the three-, six-, and twelve-month periods ended June 30, 2013, for Cleco Power |
31.3 | CEO Certification in accordance with section 302 of the Sarbanes-Oxley Act of 2002 |
31.4 | CFO Certification in accordance with section 302 of the Sarbanes-Oxley Act of 2002 |
32.3 | CEO Certification pursuant to section 906 of the Sarbanes-Oxley Act of 2002 |
32.4 | CFO Certification pursuant to section 906 of the Sarbanes-Oxley Act of 2002 |
95 | Mine Safety Disclosures |
101.INS | XBRL Instance Document |
101.SCH | XBRL Taxonomy Extension Schema |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase |
101.DEF | XBRL Taxonomy Extension Definition Linkbase |
101.LAB | XBRL Taxonomy Extension Label Linkbase |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase |
CLECO CORPORATION | ||
CLECO POWER | 2013 2ND QUARTER FORM 10-Q |
SIGNATURES |
CLECO CORPORATION | ||
(Registrant) | ||
By: | /s/ Terry L. Taylor | |
Terry L. Taylor | ||
Controller & Chief Accounting Officer |
CLECO POWER LLC | ||
(Registrant) | ||
By: | /s/ Terry L. Taylor | |
Terry L. Taylor | ||
Controller & Chief Accounting Officer |
ARTICLE I | Registered Office; Registered Agents; Corporate Seal | 1 | |
Section 1. | Registered Office and Registered Agent(s) | 1 | |
Section 2. | Corporate Seal | 1 | |
ARTICLE II | Shareholders | 1 | |
Section 1. | Place of Holding Meetings | 1 | |
Section 2. | Quorum; Adjournment of Meetings | 1 | |
(a) | General Rule | 1 | |
(b) | Special Rule | 1 | |
(c) | Adjournments | 2 | |
Section 3. | Annual Meeting | 2 | |
Section 4. | Special Meeting | 2 | |
Section 5. | Conduct of Meetings | 3 | |
Section 6. | Voting | 4 | |
Section 7. | Notice | 5 | |
Section 8. | Amendment of Articles of Incorporation | 8 | |
(a) | Shareholders Proposals | 8 | |
(b) | Effectiveness | 8 | |
Section 9. | Effectiveness of Other Amendments to Articles of Incorporation | 9 | |
Section 10. | General | 10 | |
ARTICLE III | Directors | 10 | |
Section 1. | Certain General Provisions | 10 | |
(a) | Number | 10 | |
(b) | Classifications | 10 | |
(c) | Nominations | 10 | |
(d) | Qualifications; Declaration of Vacancy | 12 | |
(e) | Removal | 13 | |
(f) | Powers | 14 | |
(g) | Change in Number of Directors | 15 | |
(h) | Rights of Preferred Shareholders, etc. | 15 | |
Section 2. | Filling of Vacancies | 15 | |
Section 3. | Annual and Regular Meetings | 15 | |
Section 4. | Special Meetings | 16 | |
Section 5. | Place of Meetings; Telephone Meetings | 16 | |
Section 6. | Quorum | 16 | |
Section 7. | Compensation | 16 | |
Section 8. | Committees | 16 | |
ARTICLE IV | Indemnification | 17 | |
Section 1. | Right to Indemnification - General | 17 |
Section 2. | Certain Provisions Respecting Indemnification for and Advancement of Expenses | 17 | |
Section 3. | Procedure for Determination of Entitlement to Indemnification | 18 | |
Section 4. | Presumptions and Effect of Certain Proceedings | 19 | |
Section 5. | Right of Claimant to Bring Suit | 19 | |
Section 6. | Non-Exclusivity and Survival of Rights | 20 | |
Section 7. | Definitions | 21 | |
ARTICLE V | Executive Committee | 22 | |
Section 1. | Election and Tenure | 22 | |
Section 2. | Executive Committee | 22 | |
Section 3. | Meetings | 22 | |
Section 4. | Compensation | 22 | |
ARTICLE VI | Audit Committee | 22 | |
Section 1. | Election and Tenure | 22 | |
Section 2. | Audit Committee | 22 | |
Section 3. | Meetings | 23 | |
Section 4. | Compensation | 23 | |
ARTICLE VII | Compensation Committee | 23 | |
Section 1. | Election and Tenure | 23 | |
Section 2. | Compensation Committee | 23 | |
Section 3. | Meetings | 23 | |
Section 4. | Compensation | 23 | |
ARTICLE VII.A. | Nominating/Governance Committee | 24 | |
Section 1. | Election and Tenure | 24 | |
Section 2. | Nominating/Governance Committee | 24 | |
Section 3. | Meetings | 24 | |
Section 4. | Compensation | 24 | |
ARTICLE VIII | Officers | 24 | |
Section 1. | Election, Tenure, and Compensation | 24 | |
Section 2. | Powers and Duties of Chairman of Board of Directors | 25 | |
Section 3. | Powers and Duties of President | 25 | |
Section 4. | Powers and Duties of Vice President | 25 | |
Section 5. | Powers and Duties of Secretary | 25 | |
Section 6. | Powers and Duties of Treasurer | 25 | |
Section 7. | Delegation of Duties | 26 | |
ARTICLE IX | Capital Stock | 26 | |
Section 1. | Stock Certificates | 26 | |
Section 2. | Lost or Destroyed Certificates | 26 | |
Section 3. | Transfer of Shares | 26 | |
Section 4. | Dividends | 27 | |
Section 5. | Closing Transfer Books; Fixing Record Date | 27 | |
ARTICLE X | Fair-Price Provisions | 27 | |
Section 1. | Definitions | 27 | |
Section 2. | Vote Required in Business Combinations | 30 | |
Section 3. | When Voting Requirements Not Applicable | 31 | |
(a) | Definitions | 31 | |
(b) | Conditions | 31 | |
(c) | Other Provisions | 34 | |
ARTICLE XI | Notices | 34 | |
Section 1. | Manner of Giving Notice | 34 | |
Section 2. | Waiver of Notice | 34 | |
ARTICLE XII | Miscellaneous | 35 | |
Section 1. | Fiscal Year | 35 | |
Section 2. | Checks and Drafts | 35 | |
Section 3. | Books and Records | 35 | |
Section 4. | Separability | 35 | |
ARTICLE XIII | Amendment of Bylaws | 35 | |
Section 1. | Voting | 35 | |
Section 2. | Shareholder Proposals | 35 | |
Section 3. | Effective Date | 36 | |
ARTICLE XIV | Other Amendments to Bylaws | 36 | |
Section 1. | Effective Date | 36 | |
ARTICLE XV | Control Share Acquisition Statute | 37 | |
Section 1. | 37 | ||
CLECO CORPORATION | EXHIBIT 12(a) |
Computation of Ratios of Earnings to Fixed Charges | ||||||||||||
FOR THE THREE MONTHS ENDED | FOR THE SIX MONTHS ENDED | FOR THE TWELVE MONTHS ENDED | ||||||||||
(THOUSANDS, EXCEPT RATIOS) | JUNE 30, 2013 | |||||||||||
Earnings from continuing operations | $ | 42,032 | $ | 69,166 | $ | 156,096 | ||||||
Undistributed equity loss from investees | — | — | 1 | |||||||||
Income taxes | 19,422 | 32,503 | 63,899 | |||||||||
Earnings from continuing operations before income taxes | $ | 61,454 | $ | 101,669 | $ | 219,996 | ||||||
Fixed charges: | ||||||||||||
Interest | $ | 20,120 | $ | 41,174 | $ | 84,005 | ||||||
Amortization of debt expense, premium, net | 897 | 1,674 | 3,229 | |||||||||
Portion of rentals representative of an interest factor | 127 | 246 | 490 | |||||||||
Interest of capitalized lease | 160 | 327 | 1,114 | |||||||||
Total fixed charges | $ | 21,304 | $ | 43,421 | $ | 88,838 | ||||||
Earnings from continuing operations before income taxes | $ | 61,454 | $ | 101,669 | $ | 219,996 | ||||||
Plus: total fixed charges from above | 21,304 | 43,421 | 88,838 | |||||||||
Plus: amortization of capitalized interest | 128 | 256 | 511 | |||||||||
Earnings from continuing operations before income taxes and fixed charges | $ | 82,886 | $ | 145,346 | $ | 309,345 | ||||||
Ratio of earnings to fixed charges | 3.89 | X | 3.35 | X | 3.48 | X |
CLECO POWER | EXHIBIT 12(b) |
Computation of Ratios of Earnings to Fixed Charges | ||||||||||||
FOR THE THREE MONTHS ENDED | FOR THE SIX MONTHS ENDED | FOR THE TWELVE MONTHS ENDED | ||||||||||
(THOUSANDS, EXCEPT RATIOS) | JUNE 30, 2013 | |||||||||||
Earnings from continuing operations | $ | 34,464 | $ | 62,257 | $ | 145,016 | ||||||
Income taxes | 17,965 | 32,203 | 65,328 | |||||||||
Earnings from continuing operations before income taxes | $ | 52,429 | $ | 94,460 | $ | 210,344 | ||||||
Fixed charges: | ||||||||||||
Interest | $ | 20,194 | $ | 41,225 | $ | 82,520 | ||||||
Amortization of debt expense, premium, net | 813 | 1,506 | 2,892 | |||||||||
Portion of rentals representative of an interest factor | 127 | 246 | 490 | |||||||||
Interest of capitalized lease | 160 | 327 | 1,114 | |||||||||
Total fixed charges | $ | 21,294 | $ | 43,304 | $ | 87,016 | ||||||
Earnings from continuing operations before income taxes | $ | 52,429 | $ | 94,460 | $ | 210,344 | ||||||
Plus: total fixed charges from above | 21,294 | 43,304 | 87,016 | |||||||||
Plus: amortization of capitalized interest | 51 | 102 | 204 | |||||||||
Earnings from continuing operations before income taxes and fixed charges | $ | 73,774 | $ | 137,866 | $ | 297,564 | ||||||
Ratio of earnings to fixed charges | 3.46 | X | 3.18 | X | 3.42 | X |
CLECO CORPORATION | EXHIBIT 31.1 |
Certification |
Date: July 31, 2013 | |
/s/ Bruce A. Williamson | |
Bruce A. Williamson President and Chief Executive Officer |
CLECO CORPORATION | EXHIBIT 31.2 |
Certification |
Date: July 31, 2013 | |
/s/ Darren J. Olagues | |
Darren J. Olagues Senior Vice President and Chief Financial Officer |
CLECO POWER LLC | EXHIBIT 31.3 |
Certification |
Date: July 31, 2013 | |
/s/ Bruce A. Williamson | |
Bruce A. Williamson Chief Executive Officer |
CLECO POWER LLC | EXHIBIT 31.4 |
Certification |
Date: July 31, 2013 | |
/s/ Darren J. Olagues | |
Darren J. Olagues Senior Vice President and Chief Financial Officer |
CLECO CORPORATION | EXHIBIT 32.1 |
Cleco Corporation CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 |
Date: July 31, 2013 | |
/s/ Bruce A. Williamson | |
Bruce A. Williamson President and Chief Executive Officer |
CLECO CORPORATION | EXHIBIT 32.2 |
Cleco Corporation CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 |
Date: July 31, 2013 | |
/s/ Darren J. Olagues | |
Darren J. Olagues Senior Vice President and Chief Financial Officer |
CLECO POWER LLC | EXHIBIT 32.3 |
Cleco Power LLC | |
CERTIFICATION PURSUANT TO | |
18 U.S.C. SECTION 1350, | |
AS ADOPTED PURSUANT TO | |
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 |
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: July 31, 2013 | |
/s/ Bruce A. Williamson | |
Bruce A. Williamson Chief Executive Officer |
CLECO POWER LLC | EXHIBIT 32.4 |
Cleco Power LLC | |
CERTIFICATION PURSUANT TO | |
18 U.S.C. SECTION 1350, | |
AS ADOPTED PURSUANT TO | |
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 |
(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: July 31, 2013 | |
/s/ Darren J. Olagues | |
Darren J. Olagues Senior Vice President and Chief Financial Officer |
CLECO CORPORATION | |
CLECO POWER | EXHIBIT 95 |
Income Taxes
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6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes |
The following table summarizes the effective income tax rates for Cleco and Cleco Power for the three and six month periods ended June 30, 2013 and 2012.
Effective Tax Rates For the three and six months ended June 30, 2013 and 2012, the effective income tax rate for Cleco was different than the federal statutory rate due to permanent tax deductions, flow-through of tax benefits associated with AFUDC equity, tax benefits delivered from Cleco's investment in the NMTC Fund, and state tax expense. For the three and six months ended June 30, 2013 and 2012, the effective income tax rate for Cleco Power was different than the federal statutory rate due to permanent tax deductions, flow-through of tax benefits associated with AFUDC equity, and state tax expense. Valuation Allowance Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. As of June 30, 2013 and December 31, 2012, Cleco had a deferred tax asset resulting from NMTC carryforwards of $87.1 million and $78.8 million, respectively. If the NMTC carryforwards are not utilized, they will begin to expire in 2029. Management considers it more likely than not that all deferred tax assets related to NMTC carryforwards will be realized; therefore, no valuation allowance has been recorded. Net Operating Losses As of June 30, 2013, Cleco had a net operating loss carryforward primarily related to a tax accounting method change for bonus depreciation associated with Madison Unit 3. Cleco considers it more likely than not that these income tax losses generated will be utilized to reduce future income taxes. Cleco expects to utilize the entire net operating loss carryforward within the statutory deadlines. Uncertain Tax Positions Cleco classifies all interest related to uncertain tax positions as a component of interest payable and interest expense. The total amounts of uncertain tax positions and related interest payable and interest expense, as reflected on Cleco and Cleco Power’s Condensed Consolidated Balance Sheets and Statements of Income, are shown in the following tables.
The interest payable reflects the amount of interest anticipated to be paid to taxing authorities. These amounts do not include any offset for amounts that may be recovered from customers under existing rate orders. The amounts expected to be recoverable from Cleco Power’s customers under existing rate orders at June 30, 2013 and December 31, 2012, are $7.7 million and $6.2 million, respectively.
The interest charges reflect the amount of interest anticipated to be paid to or received from taxing authorities. These amounts do not include any offset for the amounts that may be recovered from or owed to customers under the existing rate orders. The federal income tax years that remain subject to examination by the IRS are 2007 through 2012. The Louisiana state income tax years that remain subject to examination by the Louisiana Department of Revenue are 2002 through 2011. At December 31, 2012, Cleco had $60.4 million deposited with the IRS, of which $43.5 million remained to either offset tax and interest liabilities for tax years subsequent to 2003 or to be refunded. Cleco received a refund of tax and interest in January 2013 from the IRS of $42.3 million relating to tax years 2001 through 2008. Cleco is currently under audit by the IRS for the years 2010 through 2012. Cleco estimates that it is reasonably possible that the balance of unrecognized tax benefits as of June 30, 2013, could decrease by a maximum of $0.7 million for Cleco and the balance for Cleco Power would be unchanged in the next 12 months as a result of reaching settlements with the IRS and state tax authorities. The settlements could involve the payment of additional taxes, the adjustment of deferred taxes, and/or the recognition of tax benefits, which may have an effect on Cleco’s effective tax rate. Cleco classifies income tax penalties as a component of other expense. During 2013 and 2012, the amount of penalties recognized was immaterial. |
Pension Plan and Employee Benefits, 401 (K) Plans (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Jun. 30, 2012
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401(k) Plan [Abstract] | ||||
401 (k) Plan expense | $ 1,145 | $ 847 | $ 2,424 | $ 2,341 |
Other Subsidiaries [Member]
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401(k) Plan [Abstract] | ||||
401 (k) Plan expense | $ 200 | $ 200 | $ 600 | $ 600 |
Consolidated Statements of Comprehensive Income (Parenthetical) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Jun. 30, 2012
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Net tax expense (benefit) of amortization of postretirement benefits | $ 366 | $ 266 | $ 702 | $ 431 |
Net tax expense (benefit) on cash flow hedges | 23 | (2,360) | 859 | 413 |
Cleco Power [Member]
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Net tax expense (benefit) of amortization of postretirement benefits | 168 | 89 | 325 | 163 |
Net tax expense (benefit) on cash flow hedges | $ 23 | $ (2,360) | $ 859 | $ 413 |
Accumulated Other Comprehensive Loss
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Jun. 30, 2013
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Comprehensive Income (Loss) Note |
The components of accumulated other comprehensive loss are summarized in the following tables for Cleco and Cleco Power. All amounts are reported net of income taxes and amounts in parentheses indicate debits.
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Income Taxes, Income Tax Uncertainties (Details) (USD $)
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3 Months Ended | 6 Months Ended | |||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Jun. 30, 2012
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Dec. 31, 2012
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Uncertain Tax Positions [Abstract] | |||||
Interest payable associated with uncertain tax positions | $ 1,131,000 | $ 1,131,000 | $ 1,420,000 | ||
Interest charges related to uncertain tax positions | (221,000) | (2,716,000) | (290,000) | (8,355,000) | |
Cleco Power [Member]
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Uncertain Tax Positions [Abstract] | |||||
Interest payable associated with uncertain tax positions | 3,600,000 | 3,600,000 | 3,358,000 | ||
Amounts expected to be recovered from customers under existing rate orders | 7,700,000 | 7,700,000 | 6,200,000 | ||
Interest charges related to uncertain tax positions | $ 121,000 | $ (2,271,000) | $ 242,000 | $ (9,636,000) |
Disclosures about Segments
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosures about Segments |
Cleco’s reportable segments are based on its method of internal reporting, which disaggregates business units by its first-tier subsidiary. Cleco’s reportable segments are Cleco Power and Midstream. The holding company, a shared services subsidiary, two transmission interconnection facility subsidiaries, and an investment subsidiary are shown as Other in the following tables. Each reportable segment engages in business activities from which it earns revenue and incurs expenses. Segment managers report periodically to Cleco’s Chief Executive Officer (the chief operating decision-maker) with discrete financial information and, at least quarterly, present discrete financial information to Cleco Corporation’s Board of Directors. Each reportable segment prepared budgets for 2013 that were presented to and approved by Cleco Corporation’s Board of Directors. The financial results of Cleco’s segments are presented on an accrual basis. Management evaluates the performance of its segments and allocates resources to them based on segment profit and the requirements to implement new strategic initiatives and projects to meet current business objectives. Material intercompany transactions occur on a regular basis. These intercompany transactions relate primarily to the power purchase agreement between Cleco Power and Evangeline that began in 2012 and joint and common administrative support services provided by Support Group.
|
Debt, Short-term Debt (Details) (USD $)
In Thousands, unless otherwise specified |
Jun. 30, 2013
|
Dec. 31, 2012
|
---|---|---|
Short-term Debt [Line Items] | ||
Short-term debt | $ 3,000 | $ 0 |
Cleco Power [Member]
|
||
Short-term Debt [Line Items] | ||
Short-term debt | $ 3,000 | $ 0 |
Short-term debt, Interest Rate | 1.95% |
Income Taxes, Income Tax Examination (Details) (USD $)
In Millions, unless otherwise specified |
6 Months Ended | ||||||
---|---|---|---|---|---|---|---|
Jun. 30, 2013
Internal Revenue Service (IRS) [Member]
|
Jan. 31, 2013
Internal Revenue Service (IRS) [Member]
|
Dec. 31, 2012
Internal Revenue Service (IRS) [Member]
|
Jun. 30, 2013
Minimum [Member]
Internal Revenue Service (IRS) [Member]
|
Jun. 30, 2013
Minimum [Member]
State and Local Jurisdiction [Member]
|
Jun. 30, 2013
Maximum [Member]
Internal Revenue Service (IRS) [Member]
|
Jun. 30, 2013
Maximum [Member]
State and Local Jurisdiction [Member]
|
|
Income Tax Examination [Line Items] | |||||||
Tax years that remain subject to examination | 2007 | 2002 | 2012 | 2011 | |||
Summary of income tax examinations [Abstract] | |||||||
Deposits with the IRS | $ 60.4 | ||||||
Deposits with the IRS remaining to offset tax and interest liabilities | 43.5 | ||||||
Refund adjustment from settlement with taxing authority | 42.3 | ||||||
Income tax years currently under examination | 2010 | 2012 | |||||
Significant Change in Unrecognized Tax Benefits is Reasonably Possible, Estimated Range of Change, Upper Bound | $ (0.7) |
Regulatory Assets and Liabilities (Tables) (Cleco Power [Member])
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Cleco Power [Member]
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Schedule of Regulatory Assets and Liabilities, Net [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Regulatory Assets and Liabilities | The following table summarizes Cleco Power’s regulatory assets and liabilities at June 30, 2013 and December 31, 2012:
|
Summary of Significant Accounting Policies (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property, Plant, and Equipment | Cleco’s property, plant, and equipment consisted of:
|
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Restricted Cash and Cash Equivalents | Cleco’s restricted cash and cash equivalents consisted of:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per Average Common Share | The following tables show the calculation of basic and diluted earnings per share:
|
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Stock-Based Compensation | Cleco and Cleco Power reported pre-tax compensation expense for their share-based compensation plans as shown in the following table:
|
Fair Value Accounting, Fair Value Measurements and Disclosures(Details) (USD $)
In Thousands, unless otherwise specified |
Jun. 30, 2013
|
Dec. 31, 2012
|
---|---|---|
Cash and Cash Equivalents [Member]
|
||
Asset Description | ||
Institutional money market funds | $ 3,900 | |
Restricted Cash and Cash Equivalents, Current [Member]
|
||
Asset Description | ||
Institutional money market funds | 8,100 | |
Restricted Cash and Cash Equivalents, Noncurrent [Member]
|
||
Asset Description | ||
Institutional money market funds | 4,400 | |
Restricted Investement, Noncurrent [Member]
|
||
Asset Description | ||
Institutional money market funds | 2,300 | |
Available-for-sale securities | 10,300 | |
Measured On A Recurring Basis [Member] | Estimated Fair Value [Member]
|
||
Asset Description | ||
Institutional money market funds | 18,672 | 39,489 |
Total Assets | 28,938 | 49,692 |
Liability Description | ||
Interest rate derivatives | 0 | 2,627 |
Long-term debt | 1,455,061 | 1,579,674 |
Total Liabilities | 1,455,061 | 1,582,301 |
Measured On A Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
|
||
Asset Description | ||
Institutional money market funds | 0 | 0 |
Total Assets | 0 | 0 |
Liability Description | ||
Interest rate derivatives | 0 | 0 |
Long-term debt | 0 | 0 |
Total Liabilities | 0 | 0 |
Measured On A Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member]
|
||
Asset Description | ||
Institutional money market funds | 18,672 | 39,489 |
Total Assets | 28,938 | 49,692 |
Liability Description | ||
Interest rate derivatives | 0 | 2,627 |
Long-term debt | 1,455,061 | 1,579,674 |
Total Liabilities | 1,455,061 | 1,582,301 |
Measured On A Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member]
|
||
Asset Description | ||
Institutional money market funds | 0 | 0 |
Total Assets | 0 | 0 |
Liability Description | ||
Interest rate derivatives | 0 | 0 |
Long-term debt | 0 | 0 |
Total Liabilities | 0 | 0 |
Cleco Power [Member] | Cash and Cash Equivalents [Member]
|
||
Asset Description | ||
Institutional money market funds | 300 | |
Cleco Power [Member] | Restricted Cash and Cash Equivalents, Current [Member]
|
||
Asset Description | ||
Institutional money market funds | 8,100 | |
Cleco Power [Member] | Restricted Cash and Cash Equivalents, Noncurrent [Member]
|
||
Asset Description | ||
Institutional money market funds | 4,300 | |
Cleco Power [Member] | Restricted Investement, Noncurrent [Member]
|
||
Asset Description | ||
Institutional money market funds | 2,300 | |
Cleco Power [Member] | Measured On A Recurring Basis [Member] | Estimated Fair Value [Member]
|
||
Asset Description | ||
Institutional money market funds | 14,976 | 33,292 |
Total Assets | 25,242 | 43,495 |
Liability Description | ||
Interest rate derivatives | 0 | 2,627 |
Long-term debt | 1,430,061 | 1,554,674 |
Total Liabilities | 1,430,061 | 1,557,301 |
Cleco Power [Member] | Measured On A Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
|
||
Asset Description | ||
Institutional money market funds | 0 | 0 |
Total Assets | 0 | 0 |
Liability Description | ||
Interest rate derivatives | 0 | 0 |
Long-term debt | 0 | 0 |
Total Liabilities | 0 | 0 |
Cleco Power [Member] | Measured On A Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member]
|
||
Asset Description | ||
Institutional money market funds | 14,976 | 33,292 |
Total Assets | 25,242 | 43,495 |
Liability Description | ||
Interest rate derivatives | 0 | 2,627 |
Long-term debt | 1,430,061 | 1,554,674 |
Total Liabilities | 1,430,061 | 1,557,301 |
Cleco Power [Member] | Measured On A Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member]
|
||
Asset Description | ||
Institutional money market funds | 0 | 0 |
Total Assets | 0 | 0 |
Liability Description | ||
Interest rate derivatives | 0 | 0 |
Long-term debt | 0 | 0 |
Total Liabilities | 0 | 0 |
Municipal Bonds [Member] | Measured On A Recurring Basis [Member] | Estimated Fair Value [Member]
|
||
Asset Description | ||
Available-for-sale securities | 9,754 | 10,203 |
Municipal Bonds [Member] | Measured On A Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
|
||
Asset Description | ||
Available-for-sale securities | 0 | 0 |
Municipal Bonds [Member] | Measured On A Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member]
|
||
Asset Description | ||
Available-for-sale securities | 9,754 | 10,203 |
Municipal Bonds [Member] | Measured On A Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member]
|
||
Asset Description | ||
Available-for-sale securities | 0 | 0 |
Municipal Bonds [Member] | Cleco Power [Member]
|
||
Asset Description | ||
Available-for-sale securities | 9,754 | 10,203 |
Municipal Bonds [Member] | Cleco Power [Member] | Restricted Investement, Noncurrent [Member]
|
||
Asset Description | ||
Available-for-sale securities | 9,800 | |
Municipal Bonds [Member] | Cleco Power [Member] | Measured On A Recurring Basis [Member] | Estimated Fair Value [Member]
|
||
Asset Description | ||
Available-for-sale securities | 9,754 | 10,203 |
Municipal Bonds [Member] | Cleco Power [Member] | Measured On A Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
|
||
Asset Description | ||
Available-for-sale securities | 0 | 0 |
Municipal Bonds [Member] | Cleco Power [Member] | Measured On A Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member]
|
||
Asset Description | ||
Available-for-sale securities | 9,754 | 10,203 |
Municipal Bonds [Member] | Cleco Power [Member] | Measured On A Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member]
|
||
Asset Description | ||
Available-for-sale securities | 0 | 0 |
Corporate Bond Securities [Member] | Measured On A Recurring Basis [Member] | Estimated Fair Value [Member]
|
||
Asset Description | ||
Available-for-sale securities | 512 | 0 |
Corporate Bond Securities [Member] | Measured On A Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
|
||
Asset Description | ||
Available-for-sale securities | 0 | 0 |
Corporate Bond Securities [Member] | Measured On A Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member]
|
||
Asset Description | ||
Available-for-sale securities | 512 | 0 |
Corporate Bond Securities [Member] | Measured On A Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member]
|
||
Asset Description | ||
Available-for-sale securities | 0 | 0 |
Corporate Bond Securities [Member] | Cleco Power [Member]
|
||
Asset Description | ||
Available-for-sale securities | 512 | 0 |
Corporate Bond Securities [Member] | Cleco Power [Member] | Restricted Investement, Noncurrent [Member]
|
||
Asset Description | ||
Available-for-sale securities | 500 | |
Corporate Bond Securities [Member] | Cleco Power [Member] | Measured On A Recurring Basis [Member] | Estimated Fair Value [Member]
|
||
Asset Description | ||
Available-for-sale securities | 512 | 0 |
Corporate Bond Securities [Member] | Cleco Power [Member] | Measured On A Recurring Basis [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member]
|
||
Asset Description | ||
Available-for-sale securities | 0 | 0 |
Corporate Bond Securities [Member] | Cleco Power [Member] | Measured On A Recurring Basis [Member] | Significant Other Observable Inputs (Level 2) [Member]
|
||
Asset Description | ||
Available-for-sale securities | 512 | 0 |
Corporate Bond Securities [Member] | Cleco Power [Member] | Measured On A Recurring Basis [Member] | Significant Unobservable Inputs (Level 3) [Member]
|
||
Asset Description | ||
Available-for-sale securities | $ 0 | $ 0 |
Affiliate Transactions Affiliate Transactions (Tables) (Cleco Power [Member])
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Cleco Power [Member]
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Related Party Transaction [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Related Party Transactions [Table Text Block] | Cleco Power has affiliate balances that are payable to or due from its affiliates. The following table is a summary of those balances.
|
Debt, Long-term Debt (Details) (USD $)
|
6 Months Ended | 6 Months Ended | 6 Months Ended | 6 Months Ended | 6 Months Ended | 6 Months Ended | 6 Months Ended | 0 Months Ended | 6 Months Ended | ||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
Dec. 31, 2012
|
Jun. 30, 2013
Cleco Power [Member]
|
Dec. 31, 2012
Cleco Power [Member]
|
Jun. 30, 2013
Capital Lease Obligations [Member]
|
Jun. 30, 2013
Capital Lease Obligations [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Senior Notes [Member]
|
Jun. 30, 2013
Senior Notes [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Debt Discount Amortization [Member]
|
Jun. 30, 2013
Debt Discount Amortization [Member]
Cleco Power [Member]
|
Jun. 30, 2013
London Interbank Offered Rate (LIBOR) [Member]
Line of Credit [Member]
|
Jun. 30, 2013
London Interbank Offered Rate (LIBOR) [Member]
Notes Payable to Banks [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Cleco Katrina Rita Storm Recovery Bonds [Member]
Bonds [Member]
|
Jun. 30, 2013
Cleco Katrina Rita Storm Recovery Bonds [Member]
Bonds [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Series A GO Zone bonds [Member]
Bonds [Member]
|
Jun. 30, 2013
Series A GO Zone bonds [Member]
Bonds [Member]
Cleco Power [Member]
|
May 03, 2013
Series A GO Zone bonds [Member]
Bonds [Member]
Cleco Power [Member]
|
May 03, 2013
Series A GO Zone bonds [Member]
London Interbank Offered Rate (LIBOR) [Member]
Bonds [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Series B GO Zone bonds [Member]
Bonds [Member]
|
Jun. 30, 2013
Series B GO Zone bonds [Member]
Bonds [Member]
Cleco Power [Member]
|
May 07, 2013
Series B GO Zone bonds [Member]
Bonds [Member]
Cleco Power [Member]
|
May 07, 2013
Series B GO Zone bonds [Member]
London Interbank Offered Rate (LIBOR) [Member]
Bonds [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Cleco Power's solid waste disposal facility bonds, 5.25%, due 2037, mandatory tender on March 1, 2013 [Member]
Bonds [Member]
|
Jun. 30, 2013
Cleco Power's solid waste disposal facility bonds, 5.25%, due 2037, mandatory tender on March 1, 2013 [Member]
Bonds [Member]
Cleco Power [Member]
|
Mar. 01, 2013
Cleco Power's solid waste disposal facility bonds, 5.25%, due 2037, mandatory tender on March 1, 2013 [Member]
Bonds [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Bank Term Loan [Member]
Notes Payable to Banks [Member]
|
May 09, 2013
Bank Term Loan [Member]
Notes Payable to Banks [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Bank Term Loan [Member]
Notes Payable to Banks [Member]
Cleco Power [Member]
|
Mar. 20, 2013
Bank Term Loan [Member]
Notes Payable to Banks [Member]
Cleco Power [Member]
|
|
Debt Instrument [Line Items] | |||||||||||||||||||||||||||||
Long-term debt outstanding, total | $ 1,340,000,000 | $ 1,320,000,000 | |||||||||||||||||||||||||||
Long-term debt due within one year | 16,658,000 | 91,140,000 | 16,658,000 | 91,140,000 | |||||||||||||||||||||||||
Principal payments for Cleco Katrina/Rita storm recovery bonds due within one year | 14,500,000 | 14,500,000 | |||||||||||||||||||||||||||
Capital lease payments due within one year | 2,200,000 | 2,200,000 | |||||||||||||||||||||||||||
Debt Instrument, Increase (Decrease) for Period, Net | (8,000,000) | (8,000,000) | (1,100,000) | (1,100,000) | (75,000,000) | (75,000,000) | 200,000 | 200,000 | (7,100,000) | (7,100,000) | 50,000,000 | 50,000,000 | 50,000,000 | 50,000,000 | (60,000,000) | (60,000,000) | |||||||||||||
Debt Instrument, Decrease, Repayment on Bank Term Loan | 25,000,000 | 25,000,000 | 25,000,000 | ||||||||||||||||||||||||||
Debt Instrument, Increase, New Bank Term Loan | 60,000,000 | 60,000,000 | |||||||||||||||||||||||||||
Face value of outstanding bonds purchased | 60,000,000 | ||||||||||||||||||||||||||||
Accrued interest paid on purchase of bonds | 1,600,000 | ||||||||||||||||||||||||||||
Debt Instrument, Face Amount | 50,000,000 | 50,000,000 | 60,000,000 | ||||||||||||||||||||||||||
Bank term loan, balance | $ 35,000,000 | ||||||||||||||||||||||||||||
Interest rate (in hundredths) | 1.075% | 0.82% | 4.25% | 0.11% | |||||||||||||||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.50% | 65.00% |
Disclosures about Segments (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | The financial results of Cleco’s segments are presented on an accrual basis. Management evaluates the performance of its segments and allocates resources to them based on segment profit and the requirements to implement new strategic initiatives and projects to meet current business objectives. Material intercompany transactions occur on a regular basis. These intercompany transactions relate primarily to the power purchase agreement between Cleco Power and Evangeline that began in 2012 and joint and common administrative support services provided by Support Group.
|
Litigation, Other Commitments and Contingencies, and Disclosures about Guarantees, Disclosures about Guarantees (Details) (USD $)
|
3 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | ||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2013
Performance Guarantee [Member]
|
Jun. 30, 2013
Financial Guarantee [Member]
|
Jan. 31, 2006
Financial Guarantee [Member]
|
Jun. 30, 2013
Acadia Unit 1 Transaction [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Jun. 30, 2012
Acadia Unit 1 Transaction [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Jun. 30, 2013
Acadia Unit 1 Transaction [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Jun. 30, 2012
Acadia Unit 1 Transaction [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Feb. 28, 2010
Acadia Unit 1 Transaction [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Feb. 23, 2010
Acadia Unit 1 Transaction [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Feb. 28, 2010
Acadia Unit 1 Transaction [Member]
Cleco Power [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Jun. 30, 2013
Acadia Unit 1 Transaction [Member]
Maximum [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Jun. 30, 2013
Acadia Unit 2 Transaction [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Jun. 30, 2012
Acadia Unit 2 Transaction [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Jun. 30, 2013
Acadia Unit 2 Transaction [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Jun. 30, 2012
Acadia Unit 2 Transaction [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Apr. 29, 2011
Acadia Unit 2 Transaction [Member]
Guarantee Issued to Cleco Power on behalf of Acadia [Member]
|
Jun. 30, 2013
Lignite Mining Agreement Guarantee [Member]
Cleco Power [Member]
Financial Guarantee [Member]
|
|
Disclosures about Guarantees [Abstract] | ||||||||||||||||||
Liability recognized on the balance sheets | $ 4,956,000 | $ 200,000 | $ 900,000 | $ 900,000 | $ 3,800,000 | |||||||||||||
Guarantor Obligations, Maximum Exposure, Undiscounted | 4,225,000 | 42,400,000 | 500,000 | 10,000,000 | 30,000,000 | 298,800,000 | 298,800,000 | 72,500,000 | ||||||||||
Guarantees, Fair Value Disclosure | 13,500,000 | 21,800,000 | ||||||||||||||||
Guarantor Obligations, Period | 3 years | 3 years | ||||||||||||||||
Maximum residual value of indemnification obligation | 100,000 | 200,000 | 200,000 | |||||||||||||||
Income from contractual expiration of indemnification | 0 | 0 | 300,000 | 7,200,000 | 6,900,000 | 11,800,000 | 6,900,000 | 11,800,000 | ||||||||||
Off-balance sheet commitments, expected termination dates [Abstract] | ||||||||||||||||||
Net amount | 4,225,000 | 500,000 | 500,000 | |||||||||||||||
Less than 1 year | 3,725,000 | |||||||||||||||||
1-3 years | 0 | |||||||||||||||||
3-5 years | 0 | |||||||||||||||||
More than 5 years | 500,000 | |||||||||||||||||
On-balance sheet guarantees, expected termination dates [Abstract] | ||||||||||||||||||
Net amount committed | 4,956,000 | 200,000 | 900,000 | 900,000 | 3,800,000 | |||||||||||||
Less than 1 year | 950,000 | |||||||||||||||||
1-3 years | 0 | |||||||||||||||||
3-5 years | 0 | |||||||||||||||||
More than 5 years | 4,006,000 | |||||||||||||||||
Total off-balance sheet commitments and on-balance sheet guarantees, expected termination dates [Abstract] | ||||||||||||||||||
Total net amount committed | 9,181,000 | |||||||||||||||||
Total less than 1 year | 4,675,000 | |||||||||||||||||
Total 1-3 years | 0 | |||||||||||||||||
Total 3-5 years | 0 | |||||||||||||||||
Total more than 5 years | $ 4,506,000 |
Fair Value Accounting, Concentration of Risk (Details) (Maximum Amount of Loss [Member], USD $)
In Millions, unless otherwise specified |
Jun. 30, 2013
|
---|---|
Fair Value, Concentration of Risk, Financial Statement Captions [Line Items] | |
Concentrations of credit risk through short-term investments | $ 16.3 |
Concentrations of credit risk through short-term investments in cash equivalents | 3.9 |
Concentrations of credit risk through short-term investments in restricted cash equivalents | 12.4 |
Cleco Power [Member]
|
|
Fair Value, Concentration of Risk, Financial Statement Captions [Line Items] | |
Concentrations of credit risk through short-term investments | 12.6 |
Concentrations of credit risk through short-term investments in cash equivalents | 0.3 |
Concentrations of credit risk through short-term investments in restricted cash equivalents | $ 12.3 |
Summary of Significant Accounting Policies (Policies)
|
6 Months Ended |
---|---|
Jun. 30, 2013
|
|
Accounting Policies [Abstract] | |
Principles of Consolidation, Policy | The accompanying Condensed Consolidated Financial Statements of Cleco include the accounts of Cleco and its majority-owned subsidiaries after elimination of intercompany accounts and transactions. |
Basis of Presentation, Policy | The Condensed Consolidated Financial Statements of Cleco Corporation and Cleco Power have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, these Condensed Consolidated Financial Statements do not include all of the information and notes required by GAAP for annual financial statements. The year-end Condensed Consolidated Balance Sheet data was derived from audited financial statements. Because the interim Condensed Consolidated Financial Statements and the accompanying notes do not include all of the information and notes required by GAAP for annual financial statements, the Condensed Consolidated Financial Statements and other information included in this quarterly report should be read in conjunction with the consolidated financial statements and accompanying notes in the Registrants’ Combined Annual Report on Form 10-K for the year ended December 31, 2012. These Condensed Consolidated Financial Statements, in the opinion of management, reflect all normal recurring adjustments that are necessary to fairly present the financial position and results of operations of Cleco. Amounts reported in Cleco’s interim financial statements are not necessarily indicative of amounts expected for the annual periods due to the effects of seasonal temperature variations on energy consumption, regulatory rulings, the timing of maintenance on electric generating units, changes in mark-to-market valuations, changing commodity prices, and other factors. In preparing financial statements that conform to GAAP, management must make estimates and assumptions that affect the reported amounts of assets and liabilities, the reported amounts of revenues and expenses, and the disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. |
Property, Plant, and Equipment, Policy | Property, plant, and equipment consists primarily of regulated utility generation and energy transmission assets. Regulated assets, utilized primarily for retail operations and electric transmission and distribution, are stated at the cost of construction, which includes certain materials, labor, payroll taxes and benefits, administrative and general costs, and the estimated cost of funds used during construction. Jointly owned assets are reflected in property, plant, and equipment at Cleco Power’s share of the cost to construct or purchase the assets. |
Restricted Cash and Cash Equivalents, Policy | Various agreements to which Cleco is subject contain covenants that restrict its use of cash. As certain provisions under these agreements are met, cash is transferred out of related escrow accounts and becomes available for its intended purposes and/or general corporate purposes. Cleco Katrina/Rita has the right to bill and collect storm restoration costs from Cleco Power’s customers. As cash is collected, it is restricted for payment of operating expenses, interest, and principal on storm recovery bonds. |
Fair Value Measurements and Disclosures, Policy | Various accounting pronouncements require certain assets and liabilities to be measured at their fair values. Some assets and liabilities are required to be measured at their fair value each reporting period, while others are required to be measured only one time, generally the date of acquisition or debt issuance. Cleco and Cleco Power are required to disclose the fair value of certain assets and liabilities by one of three levels when required for recognition purposes under GAAP. |
Risk Management, Policy | Market risk inherent in Cleco’s market risk-sensitive instruments and positions includes potential changes arising from changes in interest rates and the commodity market prices of power and natural gas on different energy exchanges. Cleco’s Energy Market Risk Management Policy authorizes the use of various derivative instruments, including exchange traded futures and option contracts, forward purchase and sales contracts, and swap transactions to reduce exposure to fluctuations in the price of power and natural gas. Cleco applies the authoritative guidance as it relates to derivatives and hedging to determine whether the market risk-sensitive instruments and positions are required to be marked-to-market. Generally, Cleco Power’s market risk-sensitive instruments and positions qualify for the normal-purchase, normal-sale exception to mark-to-market accounting because Cleco Power takes physical delivery and the instruments and positions are used to satisfy customer requirements. Cleco Power may enter into positions to mitigate the volatility in customer fuel costs. These positions are marked-to-market with the resulting gain or loss recorded on the balance sheet as a component of energy risk management assets or liabilities. Such gain or loss is deferred as a component of deferred fuel assets or liabilities in accordance with regulatory policy. When these positions close, actual gains or losses will be included in the FAC and reflected on customers’ bills as a component of the fuel cost adjustment. There were no open positions at June 30, 2013 or December 31, 2012. Cleco and Cleco Power maintain a master netting agreement policy and monitor credit risk exposure through review of counterparty credit quality, counterparty credit exposure, and counterparty concentration levels. Cleco manages these risks by establishing appropriate credit and concentration limits on transactions with counterparties and by requiring contractual guarantees, cash deposits, or letters of credit from counterparties or their affiliates, as deemed necessary. Cleco Power has agreements in place with various counterparties that authorize the netting of financial buys and sells and contract payments to mitigate credit risk for transactions entered into for risk management purposes. Cleco has entered into various contracts to mitigate the volatility in interest rate risk. These contracts include, but are not limited to, interest rate swaps and treasury rate locks. For these contracts in which Cleco is hedging the variability of cash flows related to forecasted transactions that qualify as cash flow hedges, the changes in the fair value of such derivative instruments are reported in other comprehensive income. To qualify for hedge accounting, the relationship between the hedging instrument and the hedged item must be documented to include the risk management objective and strategy, and, at inception and on an ongoing basis, the effectiveness of the hedge in offsetting the changes in the cash flows of the item being hedged. Gains or losses accumulated in other comprehensive income are reclassified as earnings in the periods in which earnings are affected by the variability of the cash flows of the hedged item. The ineffective portions of hedges will be recognized in current period earnings unless management determines that it is probable that the costs will be recovered through the rate-making process. If management determines that it is probable that the costs will be recovered from customers, then they will be recognized as a regulatory asset or liability and amortized to earnings over the life of the related debt. For those contracts in which Cleco is hedging the variability of cash flows related to forecasted transactions that do not qualify as cash flow hedges, the changes in the fair value of such derivative instruments will be recognized in current period earnings unless management determines that it is probable that the costs will be recovered from customers through the rate-making process. If management determines that it is probable that the costs will be recovered from customers, then they will be recognized as a regulatory asset or liability and amortized to earnings over the life of the related debt. |
Earnings Per Average Common Share, Policy | Stock option grants are excluded from the computation of diluted earnings per share if the exercise price is higher than the average market price. |
Stock-Based Compensation, Policy | At June 30, 2013, Cleco had two stock-based compensation plans, the ESPP and the LTICP. Substantially all employees, excluding officers and general managers, may choose to participate in the ESPP and purchase a limited amount of common stock at a discount through a stock option agreement. Options or restricted shares of stock, known as non-vested stock as defined by the authoritative guidance on stock-based compensation, common stock equivalents, and stock appreciation rights may be granted to certain officers, key employees, or directors of Cleco Corporation and its subsidiaries pursuant to the LTICP. |
New Accounting Pronouncements, Policy | The Registrants adopted, or will adopt, the recent authoritative guidance listed below on their respective effective dates. In July 2012, FASB issued guidance on testing indefinite-lived intangible assets for impairment. This guidance is intended to reduce costs and complexity of testing indefinite-lived intangible assets other than goodwill for impairment. Entities are allowed to perform a “qualitative” assessment to determine whether further impairment testing of indefinite-lived intangible assets is necessary, similar in approach to the goodwill impairment test. The adoption of this guidance is effective for annual and interim impairment tests performed for fiscal years beginning after September 15, 2012. The adoption of this guidance did not have any impact on the financial condition or results of operations of the Registrants. In February 2013, FASB clarified the scope of revised disclosure requirements related to balance sheet offsetting that was issued in December 2011. The amendment clarifies that the scope applies to derivatives accounted for in accordance with the authoritative guidance for derivatives and hedging. The adoption of this revision is required for interim and annual periods beginning on or after January 1, 2013. The adoption of this revision did not have any impact on the financial condition or results of operations of the Registrants because it relates to disclosures, and no additional disclosures were required. In February 2013, FASB revised the disclosure requirements related to items reclassified out of accumulated other comprehensive income. This guidance is intended to improve the transparency of changes in OCI. This revision is effective for fiscal years, and interim periods within those years, beginning after December 15, 2012. Cleco adopted the revisions to this amendment during the first quarter of 2013. The adoption of this revision did not have any impact on the financial condition or results of operations of the Registrants because it relates to disclosures. For more information on items reclassified out of accumulated other comprehensive income, see Note 14 — “Accumulated Other Comprehensive Loss.” In March 2013, FASB issued guidance for the recognition, measurement, and disclosure of obligations resulting from joint and several liability arrangements for which the total amount of the obligation is fixed at the reporting date. The adoption of this guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. The adoption of this guidance is not expected to have a material impact on the financial condition or results of operations of the Registrants. In April 2013, FASB issued guidance on applying the liquidation basis of accounting and the related disclosure requirements. Under this accounting standards update, an entity must use the liquidation basis of accounting to present its financial statements when it determines that liquidation is imminent, unless the liquidation is the same as that under the plan specified in an entity's governing documents created at its inception. The adoption of this standard is effective for entities that determine liquidation is imminent during annual reporting periods beginning after December 15, 2013, and interim reporting periods therein. The adoption of this guidance will not have any effect on the financial condition or results of operations of the Registrants. |
Public Utilities, Policy | Cleco Power follows the authoritative guidance on regulated operations, which allows utilities to capitalize or defer certain costs based on regulatory approval and management’s ongoing assessment that it is probable these items will be recovered through the ratemaking process. |
Marketable Securities, Available-for-sale Securities, Policy | Quarterly, Cleco Power’s available-for-sale debt securities are evaluated on an individual basis to determine if a decline in fair value below the carrying value is other-than-temporary. Management determines whether it intends to sell or if it is more likely than not that it will be required to sell impaired securities. This determination considers current and forecasted liquidity and regulatory requirements. For Cleco Power’s impaired debt securities for which there was no intent or expected requirement to sell, the evaluation assesses whether it is likely the amortized cost will be recovered considering the nature of the securities, credit rating, financial condition of the issuer, or the extent and duration of the unrealized loss and market conditions. If Cleco Power determines that an other-than-temporary decline in value exists on its debt securities, the investments would be written down to fair value with a new basis established. Declines in fair value below cost basis that are determined to be other-than-temporary would be recorded to Cleco Power’s restricted storm reserve. |
Fair Value Transfer, Policy | Cleco has a policy that transfers between Levels 1, 2, and 3 are recognized at the end of a reporting period. |
Pension and Other Postretirement Plans, Policy | Most employees hired before August 1, 2007, are covered by a non-contributory, defined benefit pension plan. Benefits under the plan reflect an employee’s years of service, age at retirement, and highest total average compensation for any consecutive five calendar years during the last ten years of employment with Cleco. Cleco’s policy is to base its contributions to the employee pension plan upon actuarial computations utilizing the projected unit credit method, subject to the IRS’s full funding limitation. Most employees are eligible to participate in the 401(k) Plan. Under the 401(k) Plan, Cleco makes matching contributions and funds dividend reinvestments with cash. Cleco recognizes the expected cost of these other benefits during the periods in which the benefits are earned. Certain Cleco executive officers are covered by the SERP. The SERP is a non-qualified, non-contributory, defined-benefit pension plan. |
Income Tax, Policy | Valuation allowances are recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized. Cleco classifies all interest related to uncertain tax positions as a component of interest payable and interest expense. Cleco classifies income tax penalties as a component of other expense. |
Segment Reporting, Policy | The financial results of Cleco’s segments are presented on an accrual basis. Management evaluates the performance of its segments and allocates resources to them based on segment profit and the requirements to implement new strategic initiatives and projects to meet current business objectives. |
Equity Method Investments, Policy | Cleco reports its investments in VIEs in accordance with the authoritative guidance. Cleco and Cleco Power report the investment in Oxbow on the equity method of accounting. Under the equity method, the assets and liabilities of this entity are reported as equity investment in investees on Cleco and Cleco Power’s Condensed Consolidated Balance Sheets. The revenue and expenses (excluding income taxes) of this entity are netted and reported as equity income or loss from investees on Cleco and Cleco Power’s Condensed Consolidated Statements of Income. |
Consolidation, Variable Interest Entity, Policy | Oxbow is owned 50% by Cleco Power and 50% by SWEPCO and is accounted for as an equity method investment. Cleco Power is not the primary beneficiary because it shares the power to control Oxbow’s significant activities with SWEPCO. |
Consolidated Balance Sheets (Parenthetical) (USD $)
In Thousands, except Share data, unless otherwise specified |
Jun. 30, 2013
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Dec. 31, 2012
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Current assets | ||
Customer accounts receivable, allowance for doubtful accounts | $ 862 | $ 1,105 |
Shareholders' equity | ||
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, issued (in shares) | 61,047,006 | 60,961,570 |
Common stock, outstanding (in shares) | 60,449,214 | 60,355,545 |
Treasury stock, at cost (in shares) | 597,792 | 606,025 |
Cleco Power [Member]
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Current assets | ||
Customer accounts receivable, allowance for doubtful accounts | $ 862 | $ 1,105 |
Summary of Significant Accounting Policies
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Jun. 30, 2013
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Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies |
Principles of Consolidation The accompanying Condensed Consolidated Financial Statements of Cleco include the accounts of Cleco and its majority-owned subsidiaries after elimination of intercompany accounts and transactions. Basis of Presentation The Condensed Consolidated Financial Statements of Cleco Corporation and Cleco Power have been prepared in accordance with GAAP for interim financial information and with the instructions to Form 10-Q and Regulation S-X. Accordingly, these Condensed Consolidated Financial Statements do not include all of the information and notes required by GAAP for annual financial statements. The year-end Condensed Consolidated Balance Sheet data was derived from audited financial statements. Because the interim Condensed Consolidated Financial Statements and the accompanying notes do not include all of the information and notes required by GAAP for annual financial statements, the Condensed Consolidated Financial Statements and other information included in this quarterly report should be read in conjunction with the consolidated financial statements and accompanying notes in the Registrants’ Combined Annual Report on Form 10-K for the year ended December 31, 2012. These Condensed Consolidated Financial Statements, in the opinion of management, reflect all normal recurring adjustments that are necessary to fairly present the financial position and results of operations of Cleco. Amounts reported in Cleco’s interim financial statements are not necessarily indicative of amounts expected for the annual periods due to the effects of seasonal temperature variations on energy consumption, regulatory rulings, the timing of maintenance on electric generating units, changes in mark-to-market valuations, changing commodity prices, and other factors. In preparing financial statements that conform to GAAP, management must make estimates and assumptions that affect the reported amounts of assets and liabilities, the reported amounts of revenues and expenses, and the disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. For more information on recent authoritative guidance and its effect on financial results, see Note 2 — “Recent Authoritative Guidance.” Property, Plant, and Equipment Property, plant, and equipment consists primarily of regulated utility generation and energy transmission assets. Regulated assets, utilized primarily for retail operations and electric transmission and distribution, are stated at the cost of construction, which includes certain materials, labor, payroll taxes and benefits, administrative and general costs, and the estimated cost of funds used during construction. Jointly owned assets are reflected in property, plant, and equipment at Cleco Power’s share of the cost to construct or purchase the assets. Cleco’s property, plant, and equipment consisted of:
Restricted Cash and Cash Equivalents Various agreements to which Cleco is subject contain covenants that restrict its use of cash. As certain provisions under these agreements are met, cash is transferred out of related escrow accounts and becomes available for its intended purposes and/or general corporate purposes. Cleco’s restricted cash and cash equivalents consisted of:
Cleco Katrina/Rita has the right to bill and collect storm restoration costs from Cleco Power’s customers. As cash is collected, it is restricted for payment of operating expenses, interest, and principal on storm recovery bonds. During the six months ended June 30, 2013, Cleco Katrina/Rita collected $9.7 million net of operating expenses. In March 2013, Cleco Katrina/Rita used $7.1 million for scheduled storm recovery bond principal payments and $3.3 million for related interest. Fair Value Measurements and Disclosures Various accounting pronouncements require certain assets and liabilities to be measured at their fair values. Some assets and liabilities are required to be measured at their fair value each reporting period, while others are required to be measured only one time, generally the date of acquisition or debt issuance. Cleco and Cleco Power are required to disclose the fair value of certain assets and liabilities by one of three levels when required for recognition purposes under GAAP. For more information about fair value levels, see Note 4 — “Fair Value Accounting.” Risk Management Market risk inherent in Cleco’s market risk-sensitive instruments and positions includes potential changes arising from changes in interest rates and the commodity market prices of power and natural gas on different energy exchanges. Cleco’s Energy Market Risk Management Policy authorizes the use of various derivative instruments, including exchange traded futures and option contracts, forward purchase and sales contracts, and swap transactions to reduce exposure to fluctuations in the price of power and natural gas. Cleco applies the authoritative guidance as it relates to derivatives and hedging to determine whether the market risk-sensitive instruments and positions are required to be marked-to-market. Generally, Cleco Power’s market risk-sensitive instruments and positions qualify for the normal-purchase, normal-sale exception to mark-to-market accounting because Cleco Power takes physical delivery and the instruments and positions are used to satisfy customer requirements. Cleco Power may enter into positions to mitigate the volatility in customer fuel costs. These positions are marked-to-market with the resulting gain or loss recorded on the balance sheet as a component of energy risk management assets or liabilities. Such gain or loss is deferred as a component of deferred fuel assets or liabilities in accordance with regulatory policy. When these positions close, actual gains or losses will be included in the FAC and reflected on customers’ bills as a component of the fuel cost adjustment. There were no open positions at June 30, 2013 or December 31, 2012. Cleco and Cleco Power maintain a master netting agreement policy and monitor credit risk exposure through review of counterparty credit quality, counterparty credit exposure, and counterparty concentration levels. Cleco manages these risks by establishing appropriate credit and concentration limits on transactions with counterparties and by requiring contractual guarantees, cash deposits, or letters of credit from counterparties or their affiliates, as deemed necessary. Cleco Power has agreements in place with various counterparties that authorize the netting of financial buys and sells and contract payments to mitigate credit risk for transactions entered into for risk management purposes. Cleco has entered into various contracts to mitigate the volatility in interest rate risk. These contracts include, but are not limited to, interest rate swaps and treasury rate locks. For these contracts in which Cleco is hedging the variability of cash flows related to forecasted transactions that qualify as cash flow hedges, the changes in the fair value of such derivative instruments are reported in other comprehensive income. To qualify for hedge accounting, the relationship between the hedging instrument and the hedged item must be documented to include the risk management objective and strategy, and, at inception and on an ongoing basis, the effectiveness of the hedge in offsetting the changes in the cash flows of the item being hedged. Gains or losses accumulated in other comprehensive income are reclassified as earnings in the periods in which earnings are affected by the variability of the cash flows of the hedged item. The ineffective portions of hedges will be recognized in current period earnings unless management determines that it is probable that the costs will be recovered through the rate-making process. If management determines that it is probable that the costs will be recovered from customers, then they will be recognized as a regulatory asset or liability and amortized to earnings over the life of the related debt. For those contracts in which Cleco is hedging the variability of cash flows related to forecasted transactions that do not qualify as cash flow hedges, the changes in the fair value of such derivative instruments will be recognized in current period earnings unless management determines that it is probable that the costs will be recovered from customers through the rate-making process. If management determines that it is probable that the costs will be recovered from customers, then they will be recognized as a regulatory asset or liability and amortized to earnings over the life of the related debt. For more information on the interest rate risk contracts, see Note 4 — “Fair Value Accounting — Interest Rate Derivatives.” Earnings per Average Common Share The following tables show the calculation of basic and diluted earnings per share:
Stock option grants are excluded from the computation of diluted earnings per share if the exercise price is higher than the average market price. There were no stock option grants excluded from the computation of diluted earnings per share for the three and six months ended June 30, 2012, due to the average market price being higher than the exercise prices of the stock options. All stock options were exercised during 2012 and no additional options were granted during the six months ended June 30, 2013. Stock-Based Compensation At June 30, 2013, Cleco had two stock-based compensation plans, the ESPP and the LTICP. Substantially all employees, excluding officers and general managers, may choose to participate in the ESPP and purchase a limited amount of common stock at a discount through a stock option agreement. Options or restricted shares of stock, known as non-vested stock as defined by the authoritative guidance on stock-based compensation, common stock equivalents, and stock appreciation rights may be granted to certain officers, key employees, or directors of Cleco Corporation and its subsidiaries pursuant to the LTICP. During the six months ended June 30, 2013, Cleco granted 139,048 shares of non-vested stock to certain officers, key employees, and directors of Cleco Corporation and its subsidiaries pursuant to the LTICP. Cleco and Cleco Power reported pre-tax compensation expense for their share-based compensation plans as shown in the following table:
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Consolidated Statement of Changes in Common Shareholders' Equity (Parenthetical) (USD $)
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3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Jun. 30, 2012
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Common Stock, Dividends, Per Share, Cash Paid | $ 0.3625 | $ 0.3125 | $ 0.70 | $ 0.625 |
Regulatory Assets and Liabilities, Additional Disclosures (Details) (USD $)
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36 Months Ended | 6 Months Ended | 6 Months Ended | 3 Months Ended | 6 Months Ended | 1 Months Ended | ||||||||||||||||||||||
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Jun. 30, 2013
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Dec. 31, 2012
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Jun. 30, 2013
Cleco Power [Member]
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Dec. 31, 2012
Cleco Power [Member]
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Apr. 30, 2015
Evangeline [Member]
Evangeline Power Purchase Agreement [Member]
Cleco Power [Member]
MW
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Mar. 31, 2012
Evangeline [Member]
Evangeline Power Purchase Agreement [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Swap [Member]
Cleco Power [Member]
|
May 07, 2013
Swap [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Deferred tree trimming costs [Member]
Cleco Power [Member]
|
Jan. 29, 2013
Deferred tree trimming costs [Member]
Cleco Power [Member]
|
Dec. 31, 2012
Deferred tree trimming costs [Member]
Cleco Power [Member]
|
Jan. 31, 2008
Deferred tree trimming costs [Member]
Cleco Power [Member]
|
Jun. 30, 2013
AMI Deferred Revenue Requirement [Member]
Cleco Power [Member]
|
Dec. 31, 2012
AMI Deferred Revenue Requirement [Member]
Cleco Power [Member]
|
Jun. 30, 2013
AMI Deferred Revenue Requirement [Member]
Maximum [Member]
Cleco Power [Member]
|
Feb. 28, 2011
AMI Deferred Revenue Requirement [Member]
Maximum [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Construction carrying costs - asset [Member]
Cleco Power [Member]
|
Dec. 31, 2012
Construction carrying costs - asset [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Fuel and purchased power [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Fuel and purchased power [Member]
Cleco Power [Member]
|
Dec. 31, 2012
Fuel and purchased power [Member]
Cleco Power [Member]
|
Jun. 30, 2013
Biomass costs [Member]
Cleco Power [Member]
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Dec. 31, 2012
Biomass costs [Member]
Cleco Power [Member]
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May 30, 2013
Financing costs [Member]
Cleco Power [Member]
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Jun. 30, 2013
Financing costs [Member]
Cleco Power [Member]
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Dec. 31, 2012
Financing costs [Member]
Cleco Power [Member]
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Jun. 30, 2013
Financing costs [Member]
Swap [Member]
Cleco Power [Member]
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Jun. 30, 2013
Construction carrying costs - liability [Member]
Cleco Power [Member]
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Schedule of Regulatory Assets and Liabilities, Net [Line Items] | ||||||||||||||||||||||||||||
Regulatory asset - cap on actual expenditures | $ 12,000,000 | |||||||||||||||||||||||||||
Regulatory asset - cap on grossed up rate of return (in hundredths) | 12.40% | |||||||||||||||||||||||||||
Maximum amount of costs requested to expend and defer | 8,000,000 | |||||||||||||||||||||||||||
Amount of construction carrying costs returned to customers | 166,000,000 | |||||||||||||||||||||||||||
Regulatory liabilities | 0 | 8,255,000 | 0 | 8,255,000 | ||||||||||||||||||||||||
Long-term power purchase agreement, term (in years) | 3 years | |||||||||||||||||||||||||||
Capacity and energy provided by a power purchase agreement (in MW) | 730 | |||||||||||||||||||||||||||
Regulatory assets | 4,299,000 | 5,656,000 | 2,907,000 | 1,483,000 | 20,000,000 | 1,563,000 | 4,697,000 | 9,593,000 | 9,593,000 | 7,833,000 | 129,000 | 145,000 | 9,957,000 | 7,282,000 | ||||||||||||||
Amortization period (in years) | P15Y | P4Y | P25Y | |||||||||||||||||||||||||
Gain (Loss) on the settlement of Forward Starting Interest Rate Derivative | (3,300,000) | |||||||||||||||||||||||||||
Deferred Gain (Loss) as a Regulatory Asset on settlement of Forward Starting Interest Rate Derivative | (2,900,000) | (2,900,000) | ||||||||||||||||||||||||||
Percentage of total fuel cost regulated by LPSC (in hundredths) | 88.00% | |||||||||||||||||||||||||||
Increase (decrease) in other regulatory assets | $ 1,800,000 |
Fair Value Accounting (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Fair Value [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value By Balance Sheet Grouping | The following tables summarize the carrying value and estimated market value of Cleco and Cleco Power’s financial instruments subject to fair value accounting.
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Fair Value of Financial Assets and Liabilities Measured On A Recurring Basis | The following tables disclose for Cleco and Cleco Power the fair value of financial assets and liabilities measured or disclosed on a recurring basis and within the scope of the authoritative guidance for fair value measurements and disclosures.
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Effect of Derivatives On Consolidated Statements of Income | The following table presents the effect of derivatives designated as hedging instruments on Cleco and Cleco Power’s Condensed Consolidated Statements of Income for the three and six months ended June 30, 2013 and 2012.
* The loss reclassified from accumulated OCI into income (effective portion) is reflected in interest charges. (1) During the three months ended June 30, 2013, Cleco recorded $2.8 million of ineffectiveness and losses and for the three months ended June 30, 2012 Cleco had no ineffectiveness and losses related to the interest rate derivatives as a regulatory asset.
* The loss reclassified from accumulated OCI into income (effective portion) is reflected in interest charges. (1) During the six months ended June 30, 2013 and 2012, Cleco recorded ineffectiveness and losses related to the interest rate derivatives as a regulatory asset of $3.3 million and $2.6 million, respectively. |
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Cleco Power [Member]
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Fair Value [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value By Balance Sheet Grouping |
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Schedule of Available-for-sale Securities Reconciliation | The following table provides a reconciliation of Cleco Power’s available-for-sale debt securities from amortized cost to fair value at June 30, 2013 and December 31, 2012:
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Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | The following table summarizes the debt securities that were in an unrealized loss position at June 30, 2013, but for which no other-than-temporary impairment was recognized:
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Available-for-sale Securities | At June 30, 2013, the fair value of Cleco Power’s available-for-sale debt securities by contractual maturity was:
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Fair Value of Financial Assets and Liabilities Measured On A Recurring Basis |
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Variable Interest Entities (Tables)
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6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Variable Interest Entities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Equity Investments | The following table presents the components of Cleco Power’s equity investment in Oxbow.
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Comparison of Investee's Assets and Liabilities with Maximum Exposure to Loss | The following table compares the carrying amount of Oxbow’s assets and liabilities with Cleco’s maximum exposure to loss related to its investment in Oxbow.
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Equity Method Investments - Summarized Financial Information | The following tables contain summarized financial information for Oxbow.
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Income Taxes, Valuation Allowance (Details) (New Markets Tax Credit Carryforward [Member], USD $)
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6 Months Ended | |
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Jun. 30, 2013
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Dec. 31, 2012
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New Markets Tax Credit Carryforward [Member]
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Tax Credit Carryforward [Line Items] | ||
Tax Credit Carryforward, Valuation Allowance | $ 0 | |
Tax credit carryforwards | $ 87,100,000 | $ 78,800,000 |
Expiration date | Jan. 01, 2029 |