0000715957-14-000020.txt : 20140730 0000715957-14-000020.hdr.sgml : 20140730 20140730082630 ACCESSION NUMBER: 0000715957-14-000020 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20140730 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20140730 DATE AS OF CHANGE: 20140730 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DOMINION RESOURCES INC /VA/ CENTRAL INDEX KEY: 0000715957 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 541229715 STATE OF INCORPORATION: VA FISCAL YEAR END: 0503 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-08489 FILM NUMBER: 141001372 BUSINESS ADDRESS: STREET 1: 120 TREDEGAR STREET CITY: RICHMOND STATE: VA ZIP: 23219 BUSINESS PHONE: 8048192000 MAIL ADDRESS: STREET 1: P. O. BOX 26532 CITY: RICHMOND STATE: VA ZIP: 23261 8-K 1 driearnings8k20140730.htm DRI EARNINGS 8K 7-30-2014 driearnings8k20140730.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC  20549

FORM 8-K


CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934


Date of report (Date of earliest event reported) July 30, 2014

Dominion Resources, Inc.
(Exact Name of Registrant as Specified in Its Charter)


Virginia
(State or other jurisdiction
of incorporation)
001-08489
(Commission
File Number)
54-1229715
(IRS Employer
Identification No.)


120 Tredegar Street
Richmond, Virginia
(Address of Principal Executive Offices)
 
23219
(Zip Code)

Registrant’s Telephone Number, Including Area Code (804) 819-2000



(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o      Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 
 
 

Item 2.02 Results of Operations and Financial Condition

On July 30, 2014, Dominion Resources, Inc. issued a press release announcing unaudited earnings for the three months ended June 30, 2014.  The press release and related unaudited earnings tables are furnished with this Form 8-K as Exhibit 99.

 

 
Item 9.01 Financial Statements and Exhibits.

Exhibit
  
99
Dominion Resources, Inc. press release dated July 30, 2014





SIGNATURE


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

DOMINION RESOURCES, INC.
Registrant
 
/s/ Carter M. Reid
Carter M. Reid
Senior Vice President, Chief Administrative and Compliance Officer and Corporate Secretary
 

Date:  July 30, 2014


 EX-99 2 exhibit99.htm EXHIBIT 99 PRESS RELEASE exhibit99.htm
[NEWS RELEASE]
[logo]


                                             July 30, 2014


DOMINION ANNOUNCES SECOND-QUARTER 2014 EARNINGS
 

·  Second-quarter 2014 operating earnings of 62 cents per share compared to guidance of 55 cents to 65 cents per share
·  Second-quarter 2014 GAAP earnings of 27 cents per share
·  Year-to-date operating earnings per share up 22 cents, or 15% over 2013
·  Company affirms 2014 operating earnings guidance of $3.35 to $3.65 per share

RICHMOND, Va. – Dominion (NYSE: D) today announced unaudited reported earnings determined in accordance with Generally Accepted Accounting Principles (GAAP) for the three months ended June 30, 2014, of $159 million ($0.27 per share), compared with earnings of $202 million ($0.35 per share) for the same period in 2013.

Operating earnings for the three months ended June 30, 2014, amounted to $361 million ($0.62 per share), compared to operating earnings of $355 million ($0.62 per share) for the same period in 2013.  Operating earnings are defined as reported (GAAP) earnings adjusted for certain items.

Dominion uses operating earnings as the primary performance measurement of its earnings guidance and results for public communications with analysts and investors.  Dominion also uses operating earnings internally for budgeting, for reporting to the Board of Directors, for the company’s incentive compensation plans and for its targeted dividend payouts and other purposes. Dominion management believes operating earnings provide a more meaningful representation of the company’s fundamental earnings power.

The principal difference between GAAP earnings and operating earnings for the quarter was a charge associated with Virginia legislation permitting recovery of certain costs related to the development of a third nuclear unit at North Anna and offshore wind facilities through base rates.

Business segment results and detailed descriptions of items included in 2014 and 2013 reported earnings but excluded from operating earnings can be found on Schedules 1, 2 and 3 of this release.

Thomas F. Farrell II, chairman, president and chief executive officer, said:

“Our second-quarter results came in the upper half of our guidance range of $0.55 to $0.65 per share.  Excluding the two cents per share impact of milder than normal weather, second quarter earnings would have been at the top of our range.

“During the quarter, we also continued to move forward with our infrastructure growth plan. We received the environmental assessment from FERC for our Cove Point Liquefaction project and we anticipate receiving FERC approval for the project in the next few weeks. We are also in negotiations with multiple parties on the Southeast Reliability Pipeline and hope to secure firm contracts in the near future.

“Construction of the Warren County Power Station and Brunswick County Power Station continues on time and on budget.  During the quarter, we announced the acquisition of two solar projects in Tennessee and an agreement to acquire a seventh in California, bringing the total solar projects in service or in development to 232 megawatts.”

SECOND-QUARTER 2014 OPERATING EARNINGS COMPARED TO 2013

Second-quarter 2014 operating earnings per share were equivalent to second-quarter 2013 operating earnings per share.  The main positive driver for the quarter was a lower effective tax rate, partially offset by lower contributions from unregulated retail energy marketing operations.
 
 
Details of second-quarter 2014 operating earnings as compared to 2013 can be found on Schedule 4 of this release.

THIRD-QUARTER 2014 OPERATING EARNINGS GUIDANCE

Dominion expects third-quarter 2014 operating earnings in the range of 90 cents to $1.05 per share, compared to third-quarter 2013 operating earnings of $1.00 per share. Positive factors for the third-quarter of 2014 compared to the same period of the prior year include an expected return to normal weather in our electric service territory, higher weather-normalized kilowatt sales and higher revenues related to our electric transmission growth projects. Negative factors for the quarter include higher interest expense, the absence of a benefit from an asset contribution to Blue Racer last year, and higher operating expenses.  GAAP earnings for the third quarter of 2013 were 98 cents per share.  A reconciliation between operating and GAAP earnings for the third quarter of 2013 can be found on Schedule 3 of this release.

In providing its third-quarter and full-year 2014 operating earnings guidance, the company notes that there could be differences between expected reported earnings and estimated operating earnings for matters such as, but not limited to, divestitures or changes in accounting principles. At this time, Dominion management is not able to estimate the aggregate impact of these items on reported earnings.  However, Dominion anticipates recording additional pre-tax charges of approximately $44 million in each of the third and fourth quarters of 2014 associated with the North Anna and offshore wind legislation.

CONFERENCE CALL TODAY

Dominion will host its second-quarter earnings conference call at 10 a.m. ET on Wednesday, July 30.  Dominion management will discuss its second-quarter financial results and other matters of interest to the financial community.

Domestic callers should dial (866) 710-0179. The passcode for the conference call is “Dominion.”  International callers should dial (334) 323-9872.  Participants should dial in 10 to 15 minutes prior to the scheduled start time.  Members of the media also are invited to listen.

A live webcast of the conference call, including accompanying slides, and the Earnings Release Kit will be available on the company’s investor information page at www.dom.com/investors.

A replay of the conference call will be available beginning about 1 p.m. ET July 30 and lasting until 11 p.m. ET August 6.  Domestic callers may access the recording by dialing (877) 919-4059.  International callers should dial (334) 323-0140.  The PIN for the replay is 14710756.  Additionally, a replay of the webcast will be available on the company’s investor information page by the end of the day July 30.

Dominion is one of the nation's largest producers and transporters of energy, with a portfolio of approximately 23,600 megawatts of generation, 10,900 miles of natural gas transmission, gathering and storage pipeline, and 6,400 miles of electric transmission lines.  Dominion operates one of the nation's largest natural gas storage systems with 947 billion cubic feet of storage capacity and serves utility and retail energy customers in 10 states. For more information about Dominion, visit the company's website at www.dom.com.

This release contains certain forward-looking statements, including forecasted operating earnings for third-quarter and full-year 2014 which are subject to various risks and uncertainties.  Factors that could cause actual results to differ materially from management's projections, forecasts, estimates and expectations may include factors that are beyond the company's ability to control or estimate precisely, including fluctuations in energy-related commodity prices, estimates of future market conditions, additional competition in our industries, changes in the demand for Dominion’s services, access to and costs of capital, fluctuations in the value of our pension assets and assets held in our decommissioning trusts, impacts of acquisitions, divestitures, transfers of assets to joint ventures or an MLP and retirements of assets based on asset portfolio reviews, the receipt of regulatory approvals for, and timing of, planned projects, acquisitions and divestitures, the timing and execution of our MLP strategy, and the ability to complete planned construction or expansion projects at all or within the terms and timeframes initially anticipated.  Other factors include, but are not limited to, weather conditions and other events, including the effects of hurricanes, earthquakes, high winds, major storms and changes in water temperatures on operations, the risk associated with the operation of nuclear facilities, unplanned outages at facilities in which Dominion has an ownership interest, the impact of operational hazards and catastrophic events, state and federal legislative and regulatory developments, including changes in federal and state tax laws and changes to environmental and other laws and regulations, including those related to climate change, greenhouse gases and other emissions to which we are subject, political and economic conditions, industrial, commercial and residential growth or decline in Dominion’s service area, risks of operating businesses in regulated industries that are subject to changing regulatory structures, changes to regulated gas and electric rates collected by Dominion, changes to rating agency requirements and ratings, changing financial accounting standards, fluctuations in interest rates, employee workforce factors, including collective bargaining, counter-party credit and performance risks, adverse outcomes in litigation matters or regulatory proceedings, the risk of hostile cyber intrusions and other uncertainties.  Other risk factors are detailed from time to time in Dominion’s quarterly reports on Form 10-Q or most recent annual report on Form 10-K filed with the Securities and Exchange Commission.

#####
 
 
CONTACTS:  Media: Ryan Frazier, (804) 819-2521 or C.Ryan.Frazier@dom.com
       Financial analysts: Nathan Frost, (804) 819-2187 or Nathan.J.Frost@dom.com


 
 
 

Schedule 1 - Segment Operating Earnings
          
                 
Preliminary, Unaudited
          
(millions, except earnings per share)
Three months ended June 30,
       
2014
  
2013
  
Change
Earnings:
              
 
Dominion Virginia Power*
 $116
  
 $112
  
 $4
 
Dominion Energy
130
  
124
  
                                      6
 
Dominion Generation*
159
  
185
  
                                  (26)
 
Corporate and Other
(44)
  
(66)
  
                                    22
 
OPERATING EARNINGS
 $361
  
 $355
  
 $6
 
Items excluded from operating earnings 2, 3
                          (202)
  
                          (153)
  
                                  (49)
 
REPORTED EARNINGS 1
 $159
  
 $202
  
 $(43)
                 
Common Shares Outstanding (average, diluted)
583.9
  
578.9
    
                 
Earnings Per Share (EPS):
          
 
Dominion Virginia Power*
 $0.20
  
 $0.20
  
 $-
 
Dominion Energy
                           0.22
  
                           0.21
  
                                 0.01
 
Dominion Generation*
                           0.27
  
                           0.32
  
                               (0.05)
 
Corporate and Other
(0.07)
  
(0.11)
  
                                 0.04
 
OPERATING EARNINGS
 $0.62
  
 $0.62
  
 $-
 
Items excluded from operating earnings 2
                         (0.35)
  
                         (0.27)
  
                               (0.08)
 
REPORTED EARNINGS 1
 $0.27
  
 $0.35
  
 $(0.08)
                 
(millions, except earnings per share)
Six months ended June 30,
       
2014
  
2013
  
Change
Earnings:
              
 
Dominion Virginia Power*
 $247
  
 $228
  
 $19
 
Dominion Energy
338
  
303
  
                                    35
 
Dominion Generation*
468
  
439
  
                                    29
 
Corporate and Other
(85)
  
(139)
  
                                    54
 
OPERATING EARNINGS
 $968
  
 $831
  
 $137
 
Items excluded from operating earnings 2, 4
                          (430)
  
                          (134)
  
                                (296)
 
REPORTED EARNINGS 1
 $538
  
 $697
  
 $(159)
                 
Common Shares Outstanding (average, diluted)
583.4
  
578.2
    
                 
Earnings Per Share (EPS):
          
 
Dominion Virginia Power*
 $0.42
  
 $0.39
  
 $0.03
 
Dominion Energy
                           0.58
  
                           0.53
  
                                 0.05
 
Dominion Generation*
                           0.80
  
                           0.76
  
                                 0.04
 
Corporate and Other
(0.14)
  
(0.24)
  
                                 0.10
 
OPERATING EARNINGS
 $1.66
  
 $1.44
  
 $0.22
 
Items excluded from operating earnings 2
                         (0.74)
  
                         (0.23)
  
                               (0.51)
 
REPORTED EARNINGS 1
 $0.92
  
 $1.21
  
 $(0.29)
                 
 
1)
Determined in accordance with Generally Accepted Accounting Principles (GAAP).
        
 
2)
Items excluded from operating earnings are reported in Corporate and Other segment.  Refer to Schedules
    
   
2 and 3 for details, or find "GAAP Reconciliation" on Dominion's website at www.dom.com/investors.
      
 
3)
Pre-tax amounts for the current period and the prior period are ($302) million and ($263) million, respectively.
        
 
4)
Pre-tax amounts for the current period and the prior period are ($654) million and ($232) million, respectively.
        
                 
                 
 
*
Amounts for 2013 have been recast to reflect unregulated retail energy marketing operations in Dominion Generation.
    

 
 
 

Schedule 2 - Reconciliation of 2014 Operating Earnings to Reported Earnings

2014 Earnings (Six months ended June 30, 2014)

The net effects of the following items, all shown on an after-tax basis, are included in 2014 reported earnings, but are excluded from operating earnings:
 
·  
$193 million net charge related to the repositioning of our Producer Services business, reflecting the termination of natural gas trading and certain energy marketing activities.
·  
$191 million charge associated with Virginia legislation enacted in April that permits Virginia Power to recover 70% of the costs previously deferred or capitalized through Dec. 31, 2013 relating to the development of a third nuclear unit located at North Anna and offshore wind facilities as part of the 2013 and 2014 base rates.
·
·  
$31 million goodwill write-off associated with the company exiting the unregulated electric retail energy marketing business.
$15 million net charge related to other items.
 
(millions, except per share amounts)
1Q14
2Q14
3Q14
4Q14
YTD 2014
2
Operating earnings
$607
$361
    
$968
  
Items excluded from operating earnings (after-tax):
            
 
Producer Services repositioning
(193)
      
(193)
  
 
North Anna and offshore wind facilities
  
(191)
    
(191)
  
 
Goodwill write-off at unregulated electric retail
(31)
      
(31)
  
 
Other items
(4)
(11)
    
(15)
  
 
Total items excluded from operating earnings (after-tax) 1
(228)
(202)
    
(430)
  
Reported net income
$379
$159
    
$538
  
Common shares outstanding (average, diluted)
582.9
583.9
    
583.4
  
Operating earnings per share
$1.04
$0.62
    
$1.66
  
Items excluded from operating earnings (after-tax)
(0.39)
(0.35)
    
(0.74)
  
Reported earnings per share
$0.65
$0.27
    
$0.92
  
               
1)
Pre-tax amounts for items excluded from operating earnings are reflected in the following table:
          
 
Items excluded from operating earnings:
1Q14
2Q14
3Q14
4Q14
YTD 2014
  
               
 
Producer Services repositioning
(319)
      
(319)
  
 
North Anna and offshore wind facilities
  
(287)
    
(287)
  
 
Goodwill write-off at unregulated electric retail
(31)
      
(31)
  
 
Other items
(2)
(15)
    
(17)
  
 
Total items excluded from operating earnings
($352)
($302)
$0
$0
($654)
  
               
2)
YTD EPS may not equal sum of quarters due to share count differences.
            

 
 
 

Schedule 3 - Reconciliation of 2013 Operating Earnings to Reported Earnings

2013 Earnings (Twelve months ended December 31, 2013)

The net effects of the following items, all shown on an after-tax basis, are included in 2013 reported earnings, but are excluded from operating earnings:

·  
$92 million net loss from discontinued operations of two merchant power stations (Brayton Point & Kincaid) which were sold in third quarter 2013.
·  
$109 million net charge related to an impairment of certain natural gas infrastructure assets and the repositioning of Producer Services.
·  
$28 million charge in connection with the Virginia Commission’s final ruling associated with its biennial review of Virginia Power’s base rates for 2011-2012 test years.
·  
$17 million charge associated with our operating expense reduction initiative, primarily reflecting severance pay and other employee-related costs.
·  
$39 million net gain related to our investments in nuclear decommissioning trust funds.
·
·  
$30 million benefit due to a downward revision in the nuclear decommissioning asset retirement obligations (ARO) for certain merchant nuclear units that are no longer in service.
$7 million net expense related to other items.
 
 
(millions, except per share amounts)
1Q13
2Q13
3Q13
4Q13
YTD 2013
2
Operating earnings
$476
$355
$583
$467
$1,881
  
Items excluded from operating earnings (after-tax):
            
 
Discontinued operations - Brayton Point & Kincaid
1
(70)
(23)
  
(92)
  
 
Gas infrastructure & repositioning
  
(57)
(17)
(35)
(109)
  
 
Impact of Virginia Power biennial review order
      
(28)
(28)
  
 
O&M expense reduction initiative
  
(17)
    
(17)
  
 
Net gain in nuclear decommissioning trust funds
20
1
9
9
39
  
 
ARO revision
      
30
30
  
 
Other items
(2)
(10)
17
(12)
(7)
  
 
Total items excluded from operating earnings (after-tax) 1
19
(153)
(14)
(36)
(184)
  
Reported net income
$495
$202
$569
$431
$1,697
  
Common shares outstanding (average, diluted)
577.5
578.9
580.1
581.3
579.5
  
Operating earnings per share
$0.83
$0.62
$1.00
$0.80
$3.25
  
Items excluded from operating earnings (after-tax)
0.03
(0.27)
(0.02)
(0.06)
(0.32)
  
Reported earnings per share
$0.86
$0.35
$0.98
$0.74
$2.93
  
               
1)
Pre-tax amounts for items excluded from operating earnings are reflected in the following table:
          
 
Items excluded from operating earnings:
1Q13
2Q13
3Q13
4Q13
YTD 2013
  
               
 
Discontinued operations - Brayton Point & Kincaid
1
(119)
(17)
  
(135)
  
 
Gas infrastructure & repositioning
  
(107)
(23)
(52)
(182)
  
 
Impact of Virginia Power biennial review order
      
(40)
(40)
  
 
O&M expense reduction initiative
  
(28)
    
(28)
  
 
Net gain in nuclear decommissioning trust funds
34
1
15
15
65
  
 
ARO revision
      
47
47
  
 
Other items
(4)
(10)
29
(26)
(11)
  
 
Total items excluded from operating earnings
$31
($263)
$4
($56)
($284)
  
               
2)
YTD EPS may not equal sum of quarters due to share count differences.
            

 
 
 

Schedule 4 - Reconciliation of 2Q14 Earnings to 2Q13
    
       
Preliminary, unaudited
Three Months Ended
(millions, except EPS)
June 30,
   
2014 vs. 2013
   
Increase / (Decrease)
Reconciling Items
Amount
EPS
       
Dominion Virginia Power
    
 
Regulated electric sales:
    
 
     Weather
$2
$0.00
 
FERC Transmission equity return
7
0.01
 
Storm damage and service restoration
7
0.01
 
Other
(12)
(0.02)
 
Change in contribution to operating earnings
$4
$0.00
       
Dominion Energy
    
 
Gas Distribution margins
3
0.00
 
Gas Transmission projects
8
0.02
 
Other
(5)
(0.01)
 
Change in contribution to operating earnings
$6
$0.01
       
Dominion Generation
    
 
Regulated electric sales:
    
 
     Weather
$3
$0.01
 
     Other
(2)
0.00
 
Merchant generation margin
9
0.02
 
Retail energy marketing operations
(18)
(0.04)
 
Rate adjustment clause equity return
(17)
(0.04)
 
PJM ancillary services
5
0.01
 
Other
(6)
(0.01)
 
Change in contribution to operating earnings
($26)
($0.05)
       
Corporate and Other
    
 
Change in contribution to operating earnings
$22
$0.04
       
Change in consolidated operating earnings
$6
$0.00
       
Change in items excluded from operating earnings 1
($49)
($0.08)
       
Change in reported earnings (GAAP)
($43)
($0.08)
       
       
1)
Refer to Schedules 2 and 3 for details of items excluded from operating earnings, or find "GAAP Reconciliation"
  
 
on Dominion's website at www.dom.com/investors.