EX-99 3 k80968aexv99.txt CMS NEWS RELEASE DATED NOVEMBER 11, 2003 [CMS ENERGY LOGO] NEWS RELEASE CMS ENERGY ANNOUNCES THIRD QUARTER LOSS OF $0.51 PER SHARE; REAFFIRMS EARNINGS GUIDANCE JACKSON, Mich., Nov. 11, 2003 -- CMS Energy (NYSE: CMS) announced a reported net loss of $77 million, or $0.51 per share, for the third quarter of 2003, compared to reported net income of $37 million, or $0.26 per share, for the same quarter of 2002. The reported loss includes $0.52 per share for charges and costs that were anticipated as a result of the Company's continuing strategic and financial restructuring plan. Ongoing (non-Generally Accepted Accounting Principles) net income for the third quarter was $1 million, or $0.01 per share, compared to ongoing net income of $65 million or $0.46 per share in the same period of 2002. Ongoing earnings provide a key measure of the Company's present operating financial performance, unaffected by discontinued operations, asset sales or other items detailed in the attached summary financial statements. Compared with the third quarter of 2002, the lower 2003 third quarter ongoing results reflect lower electric sales, partly because of cooler summer weather. Temperatures during the quarter averaged 2.5 degrees cooler than the similar period last year. The lower summer temperatures, a slow economic recovery in Michigan, and more customers taking power from alternate suppliers reduced electric deliveries at CMS Energy's principal subsidiary, Consumers Energy, by 6.4 percent during the quarter, compared to the same quarter last year. In addition, the lower results reflect the absence of earnings from businesses sold, and expenses associated with refinancings to extend debt maturities and lower interest rates. For the first nine months of 2003, CMS Energy had a reported net loss of $43 million, or $0.29 per share, compared to reported net income of $5 million, or $0.04 per share, for the same period in 2002. Ongoing net income for the period was $80 million, or $0.55 per share, compared to $161 million, or $1.18 per share, for the first three quarters of 2002. The Company reaffirmed its full-year ongoing earnings guidance of $0.80 to $0.90 per share, noting results likely will be at the lower end of the guidance. The Company also reaffirmed its guidance for full-year reported results as a loss of about $1 per share. During the quarter, CMS Energy continued to make progress on its asset sales program. It signed an agreement to sell its 6,000-acre Arcadia parcel on Lake Michigan to the Grand Traverse Regional Land Conservancy. The Company also signed an agreement to sell its 51 percent interest in the Marysville underground storage terminal near Port Huron, Mich. Both sales are expected to close before the end of the year. CMS Energy is working to realize $900 million in net proceeds from asset sales in 2003, although several potential transactions that require regulatory approvals may not occur until 2004. The successful asset sales program is helping CMS Energy to continue to reduce its debt, dropping it from $7.3 billion at the end of 2002 to a projected $6.2 billion at the end of 2003. A recent CMS Energy highlight was a J.D. Power and Associates study that found Consumers Energy's natural gas utility ranked highest for customer satisfaction in the Midwest for the second year in a row. Ken Whipple, CMS Energy's chairman and chief executive officer, said the J.D. Power award reflects the Company's underlying operational strength. "That strength comes from our employees, who are among the best in the energy business and are committed to superior customer service," he said. Whipple added: "Our business plan is solid, although our financial results are down this quarter as we continue the transition to a smaller, utility-based company. We are continuing to increase our financial flexibility, reduce debt, and meet commitments." CMS Energy is an integrated energy company, which has as its primary business operations an electric and natural gas utility, natural gas pipeline systems, and independent power generation. # # # For more information on CMS Energy, please visit our web site at: www.cmsenergy.com Media Contacts: Jeff Holyfield, 517-788-2394, or Dan Bishop, 517/788-2395 Investment Analyst Contact: CMS Energy Investor Relations, 517/788-2590 This news release contains "forward-looking statements" within the meaning of the safe harbor provisions of the federal securities laws. It should be read in conjunction with the forward-looking statements cautionary factors in CMS Energy's Securities and Exchange Commission filings that identify important factors that could cause CMS Energy's results to differ materially from those anticipated in such statements. CMS Energy Corporation SUMMARY OF CONSOLIDATED EARNINGS Condensed Consolidated Income Statements (Millions, Except Per Share Amounts)
Third Quarter Nine Months (Unaudited) (Unaudited) ---------------------- ---------------------- 2003 2002 2003 2002 --------- --------- --------- --------- Operating Revenue $ 1,016 $ 2,534 $ 4,059 $ 6,843 Earnings from Equity Method Investees 20 41 120 126 Operating Expenses 907 2,385 3,629 6,353 --------- --------- --------- --------- Operating Income $ 129 $ 190 $ 550 $ 616 Other Income (Deductions) - 2 (3) 34 Fixed Charges 179 127 451 381 Income Tax Expense (Benefit) (16) 54 58 128 Minority Interests - - 1 1 --------- --------- --------- --------- Income (Loss) from Continuing Operations $ (34) $ 11 $ 37 $ 140 Income (Loss) from Discontinued Operations (43) 25 (56) (153) Cumulative Effect of Accounting Changes - 1 (24) 18 --------- --------- --------- --------- Net Income (Loss) $ (77) $ 37 $ (43) $ 5 ========= ========= ========= ========= Earnings (Loss) Per Share Basic $ (0.51) $ 0.26 $ (0.29) $ 0.04 Diluted (0.51) 0.26 (0.29) 0.04
CMS Energy Corporation SUMMARIZED COMPARATIVE BALANCE SHEETS (Millions of Dollars)
As of September 30 (Unaudited) ----------------------------- December 31 2003 2002 2002 ----------- ----------- ----------- ASSETS Cash and cash equivalents $ 664 $ 332 $ 359 Restricted cash 205 18 38 Other current assets 1,806 1,940 2,351 ----------- ----------- ----------- Total current assets $ 2,675 $ 2,290 $ 2,748 Net plant and property 5,742 5,630 5,230 Investments 1,425 1,567 1,393 Non-current assets 2,469 4,910 4,544 ----------- ----------- ----------- Total assets $ 12,311 $ 14,397 $ 13,915 =========== =========== =========== STOCKHOLDERS' INVESTMENT AND LIABILITIES Capitalization Debt Long-term debt (excluding Securitization) $ 5,885 $ 5,215 $ 4,930 Capital leases 116 110 116 Notes Payable 4 235 458 Current portion of long-term debt and capital leases (excluding securitization) 156 574 613 ----------- ----------- ----------- Total debt $ 6,161 $ 6,134 $ 6,117 Preferred stock and securities 707 927 927 Minority interest 23 12 21 Common stockholders' equity 1,353 1,829 1,133 ----------- ----------- ----------- Total capitalization $ 8,244 $ 8,902 $ 8,198 Securitization debt 434 460 453 Current liabilities 1,009 1,711 1,800 Non-current liabilities 2,624 3,324 3,464 ----------- ----------- ----------- Total Stockholders' Investment and Liabilities $ 12,311 $ 14,397 $ 13,915 =========== =========== ===========
CMS Energy Corporation SUMMARIZED STATEMENTS OF CASH FLOWS (Millions of Dollars)
Nine Months (Unaudited) ---------------------- 2003 2002 --------- --------- Beginning of Period Cash $ 359 $ 123 --------- --------- Cash (used in) provided by operating activities $ (14) $ 333 Cash provided by investing activites 501 884 Cash used in financing activities (184) (1,008) Currency Translation Adjustment 2 - --------- --------- Total Cash Flow $ 305 $ 209 --------- --------- End of Period Cash $ 664 $ 332 ========= =========
CMS Energy Corporation SUMMARY OF CONSOLIDATED EARNINGS Reconciliations of GAAP Net Income (Loss) to Non-GAAP Ongoing Net Income (Loss) (Millions, Except Per Share Amounts)
Third Quarter Nine Months (Unaudited) (Unaudited) -------------------- -------------------- 2003 2002 2003 2002 --------- --------- --------- --------- NET INCOME (LOSS) $ (77) $ 37 $ (43) $ 5 Reconciling Items: Discontinued Operations (Income) Loss 43 (25) 56 153 Cumulative Effect of Accounting Changes: EITF #02-03 MTM Accounting - - 23 - SFAS No. 143 Asset Retirement Obligation - - 1 - SFAS No. 133 Derivative Accounting - (1) - (18) Net Asset (Gain)/Loss and Other 35 54 43 21 --------- --------- --------- --------- Ongoing Net Income - Non-GAAP Basis $ 1 $ 65 $ 80 $ 161 ========= ========= ========= ========= Average Number of Common Shares Outstanding Basic 152 144 147 137 Diluted 157 148 151 142 BASIC EARNINGS (LOSS) PER AVERAGE COMMON SHARE Earnings (Loss) Per Share as Reported $ (0.51) $ 0.26 $ (0.29) $ 0.04 Reconciling Items: Discontinued Operations (Income) Loss 0.29 (0.17) 0.38 1.11 Cumulative Effect of Accounting Changes: EITF #02-03 MTM Accounting - - 0.15 - SFAS No. 143 Asset Retirement Obligations - - 0.01 - SFAS No. 133 Derivative Accounting - (0.01) - (0.13) Net Asset (Gain)/Loss and Other 0.23 0.38 0.30 0.16 --------- --------- --------- --------- Ongoing Net Income - Non-GAAP Basis $ 0.01 $ 0.46 $ 0.55 $ 1.18 ========= ========= ========= ========= DILUTED EARNINGS (LOSS) PER AVERAGE COMMON SHARE Earnings (Loss) Per Share as Reported $ (0.51) $ 0.26 $ (0.29) $ 0.04 Reconciling Items: Discontinued Operations (Income) Loss 0.29 (0.17) 0.38 1.11 Cumulative Effect of Accounting Changes: EITF #02-03 MTM Accounting - - 0.15 - SFAS No. 143 Asset Retirement Obligations - - 0.01 - SFAS No. 133 Derivative Accounting - (0.01) - (0.13) Net Asset (Gain)/Loss and Other 0.23 0.38 0.30 0.16 --------- --------- --------- --------- Ongoing Net Income - Non-GAAP Basis $ 0.01 $ 0.46 $ 0.55 $ 1.18 ========= ========= ========= =========