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) |
Exhibit
|
|
99
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DOMINION ENERGY, INC.
Registrant |
/s/ Carter M. Reid
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Carter M. Reid
Executive Vice President, Chief Administrative & Compliance Officer and Corporate Secretary
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·
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First-quarter 2018 reported earnings of $0.77 per share
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·
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First-quarter 2018 operating earnings of $1.14 per share
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·
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Company expects to produce results that are above the midpoint of the reaffirmed full-year 2018 operating earnings guidance of $3.80 to $4.25 per share
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·
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Company affirms intention to increase dividends per share by 10% per year through 2019 and 6%—10% in 2020
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Dominion Energy, Inc.
Consolidated Statements of Income*
Unaudited (GAAP Based)
(millions, except per share amounts)
|
||||
Three Months Ended March 31,
|
||||
2018
|
2017
|
|||
Operating Revenue
|
$ 3,466
|
$ 3,384
|
||
Operating Expenses
|
||||
Electric fuel and other energy-related purchases
|
744
|
575
|
||
Purchased (excess) electric capacity
|
14
|
(17)
|
||
Purchased gas
|
340
|
305
|
||
Other operations and maintenance
|
796
|
784
|
||
Depreciation, depletion and amortization
|
498
|
469
|
||
Other taxes
|
199
|
189
|
||
Total operating expenses
|
2,591
|
2,305
|
||
Income from operations
|
875
|
1,079
|
||
Other income
|
100
|
162
|
||
Interest and related charges
|
314
|
292
|
||
Income from operations including noncontrolling interests before income tax expense
|
661
|
949
|
||
Income tax expense
|
135
|
275
|
||
Net Income Including Noncontrolling Interests
|
526
|
674
|
||
Noncontrolling Interests
|
23
|
42
|
||
Net Income Attributable to Dominion Energy
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$ 503
|
$ 632
|
||
Earnings Per Common Share
|
||||
Net income attributable to Dominion Energy - Basic
|
$ 0.77
|
$ 1.01
|
||
Net income attributable to Dominion Energy - Diluted
|
0.77
|
1.01
|
||
Dividends Declared Per Common Share
|
$ 0.835
|
$ 0.7550
|
||
* The notes contained in Dominion Energy's most recent quarterly report on Form 10-Q or annual report on Form 10-K are an integral part of the Consolidated Financial Statements.
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Schedule 1 - Segment Reported and Operating Earnings
|
||||||||
Unaudited
|
||||||||
(millions, except earnings per share)
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Three months ended March 31,
|
|||||||
2018
|
2017
|
Change
|
||||||
REPORTED EARNINGS 1
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$ 503
|
$ 632
|
$ (129)
|
|||||
Pre-tax loss (income) 2
|
305
|
(31)
|
336
|
|||||
Income tax 2
|
(67)
|
10
|
(77)
|
|||||
Adjustments to reported earnings
|
238
|
(21)
|
259
|
|||||
OPERATING EARNINGS
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$ 741
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$ 611
|
$ 130
|
|||||
By segment:
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||||||||
Power Delivery
|
156
|
125
|
31
|
|||||
Power Generation
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348
|
261
|
87
|
|||||
Gas Infrastructure
|
327
|
263
|
64
|
|||||
Corporate and Other
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(90)
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(38)
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(52)
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|||||
$ 741
|
$ 611
|
$ 130
|
||||||
Earnings Per Share (EPS):
|
||||||||
REPORTED EARNINGS 1
|
$ 0.77
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$ 1.01
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$ (0.24)
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|||||
Adjustments to reported earnings (after tax)
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0.37
|
(0.04)
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0.41
|
|||||
OPERATING EARNINGS
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$ 1.14
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$ 0.97
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$ 0.17
|
|||||
By segment:
|
||||||||
Power Delivery
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0.24
|
0.20
|
0.04
|
|||||
Power Generation
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0.54
|
0.41
|
0.13
|
|||||
Gas Infrastructure
|
0.50
|
0.42
|
0.08
|
|||||
Corporate and Other
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(0.14)
|
(0.06)
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(0.08)
|
|||||
$ 1.14
|
$ 0.97
|
$ 0.17
|
||||||
Common Shares Outstanding (average, diluted)
|
650.5
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628.1
|
||||||
1)
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Determined in accordance with Generally Accepted Accounting Principles (GAAP).
|
|||||||
2)
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Adjustments to reported earnings are included in Corporate and Other segment reported GAAP earnings. Refer to Schedules 2 and 3 for details, or find "GAAP Reconciliation" in the Earnings Release Kit on Dominion Energy's website at www.dominionenergy.com/investors.
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|||||||
·
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$215 million charge associated with Virginia legislation enacted in March that requires one-time rate credits of certain amounts to utility customers.
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·
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$43 million net loss related to our investments in nuclear decommissioning trust.
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·
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$31 million of restoration costs associated with Winter Storm Riley primarily affecting our Virginia service territory.
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·
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$16 million of transaction and transition costs associated with the Dominion Energy Questar combination and the proposed acquisition of SCANA Corporation.
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(millions, except per share amounts)
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1Q18
|
2Q18
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3Q18
|
4Q18
|
YTD 2018
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|
Reported earnings
|
$503
|
$503
|
||||
Adjustments to reported earnings 1:
|
||||||
Pre-tax loss (income)
|
305
|
305
|
||||
Income tax
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(67)
|
(67)
|
||||
238
|
238
|
|||||
Operating earnings
|
$741
|
$741
|
||||
Common shares outstanding (average, diluted)
|
650.5
|
650.5
|
||||
Reported earnings per share
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$0.77
|
$0.77
|
||||
Adjustments to reported earnings (after-tax)
|
0.37
|
0.37
|
||||
Operating earnings per share
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$1.14
|
$1.14
|
||||
1) Adjustments to reported earnings are reflected in the following table:
|
||||||
1Q18
|
2Q18
|
3Q18
|
4Q18
|
YTD 2018
|
||
Pre-tax loss (income):
|
||||||
Impact of Virginia rate legislation
|
215
|
215
|
||||
Net loss on NDT funds
|
43
|
43
|
||||
Storm costs
|
31
|
31
|
||||
Merger-related transaction and transition costs
|
16
|
16
|
||||
$305
|
$305
|
|||||
Income tax expense (benefit):
|
||||||
Tax effect of above adjustments to reported earnings *
|
(67)
|
(67)
|
||||
($67)
|
($67)
|
|||||
* Income taxes for individual pre-tax items include current and deferred taxes using a transactional effective tax rate. For interim reporting purposes, such amounts may be adjusted in connection with the calculation of the Company's year-to-date income tax provision based on its estimated annual effective tax rate.
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·
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$158 million of impairment charges associated with our equity method investments in wind-powered generation facilities.
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·
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$72 million of transaction and transition costs, primarily associated with the Dominion Energy Questar combination.
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·
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$46 million net gain related to our investments in nuclear decommissioning trust funds.
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(millions, except per share amounts)
|
1Q17
|
2Q17
|
3Q17
|
4Q17
|
YTD 2017
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2
|
|
Reported earnings
|
$632
|
$390
|
$665
|
$1,312
|
$2,999
|
||
Adjustments to reported earnings 1:
|
|||||||
Pre-tax loss (income)
|
(31)
|
47
|
12
|
207
|
235
|
||
Income tax
|
10
|
(16)
|
(5)
|
(934)
|
(945)
|
||
(21)
|
31
|
7
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(727)
|
(710)
|
|||
Operating earnings
|
$611
|
$421
|
$672
|
$585
|
$2,289
|
||
Common shares outstanding (average, diluted)
|
628.1
|
629.2
|
642.5
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643.9
|
636.0
|
||
Reported earnings per share
|
$1.01
|
$0.62
|
$1.03
|
$2.04
|
$4.72
|
||
Adjustments to reported earnings (after-tax)
|
(0.04)
|
0.05
|
0.01
|
(1.13)
|
(1.12)
|
||
Operating earnings per share
|
$0.97
|
$0.67
|
$1.04
|
$0.91
|
$3.60
|
||
1) Adjustments to reported earnings are reflected in the following table:
|
|||||||
1Q17
|
2Q17
|
3Q17
|
4Q17
|
YTD 2017
|
|||
Pre-tax loss (income):
|
|||||||
Impairments of equity method investments
|
158
|
158
|
|||||
Merger-related transaction & transition costs
|
3
|
20
|
16
|
33
|
72
|
||
Net gain on NDT funds
|
(34)
|
(3)
|
(4)
|
(5)
|
(46)
|
||
Other
|
30
|
21
|
51
|
||||
($31)
|
$47
|
$12
|
$207
|
$235
|
|||
Income tax expense (benefit):
|
|||||||
Tax effect of above adjustments to reported earnings *
|
10
|
(16)
|
(5)
|
(83)
|
(94)
|
||
Re-measurement of Deferred Tax Balances **
|
(851)
|
(851)
|
|||||
$10
|
($16)
|
($5)
|
($934)
|
($945)
|
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* Income taxes for individual pre-tax items include current and deferred taxes using a transactional effective tax rate. For interim reporting purposes, such amounts may be adjusted in connection with the calculation of the Company's year-to-date income tax provision based on its estimated annual effective tax rate.
|
|||||||
** Federal tax reform, enacted in December 2017, reduced the corporate income tax rate from 35% to 21%, effective 1/1/2018. Deferred taxes are required to be measured at the enacted rate in effect when they are expected to reverse. As a result, deferred taxes were re-measured to the 21% rate. For regulated entities, where the reduction in deferred taxes is expected to be recovered or refunded in future rates, the adjustment was recorded to a regulatory asset or liability instead of income tax expense.
|
|||||||
2) YTD EPS may not equal sum of quarters due to share count differences
|
Schedule 4 - Reconciliation of 1Q18 Earnings to 1Q17
|
||||
Preliminary, Unaudited
|
Three Months Ended
March 31,
2018 vs. 2017
Increase / (Decrease)
|
|||
(millions, except EPS)
|
||||
Reconciling Items
|
Amount
|
EPS
|
||
Change in reported earnings (GAAP)
|
($129)
|
($0.24)
|
||
Change in Pre-tax loss (income) 1
|
336
|
|||
Change in Income tax 1
|
(77)
|
|||
Adjustments to reported earnings
|
$259
|
$0.41
|
||
Change in consolidated operating earnings
|
$130
|
$0.17
|
||
Power Delivery 2
|
||||
Regulated electric sales:
|
||||
Weather
|
$14
|
$0.02
|
||
Other
|
4
|
0.01
|
||
FERC Transmission equity return
|
4
|
0.01
|
||
Tax reform impacts
|
0
|
0.00
|
||
Other
|
9
|
0.01
|
||
Share dilution
|
-
|
(0.01)
|
||
Change in contribution to operating earnings
|
$31
|
$0.04
|
||
Power Generation 2
|
||||
Regulated electric sales:
|
||||
Weather
|
$28
|
$0.04
|
||
Other
|
(9)
|
(0.01)
|
||
Merchant generation margin
|
61
|
0.10
|
||
Electric capacity
|
(18)
|
(0.03)
|
||
Tax reform impacts
|
23
|
0.04
|
||
Other
|
2
|
0.01
|
||
Share dilution
|
-
|
(0.02)
|
||
Change in contribution to operating earnings
|
$87
|
$0.13
|
||
Gas Infrastructure 2
|
||||
Farmout transactions
|
$32
|
$0.05
|
||
Transportation and storage growth projects
|
8
|
0.01
|
||
Cove Point import contracts
|
(9)
|
(0.01)
|
||
Tax reform impacts
|
32
|
0.05
|
||
Other
|
1
|
0.00
|
||
Share dilution
|
-
|
(0.02)
|
||
Change in contribution to operating earnings
|
$64
|
$0.08
|
||
Corporate and Other 2
|
||||
Renewable energy investment tax credits
|
($35)
|
($0.05)
|
||
Tax reform impacts
|
($19)
|
(0.03)
|
||
Interest expense and other
|
2
|
0.00
|
||
Change in contribution to operating earnings
|
($52)
|
($0.08)
|
||
Change in consolidated operating earnings
|
$130
|
$0.17
|
||
Change in adjustments included in reported earnings1
|
($259)
|
($0.41)
|
||
Change in consolidated reported earnings
|
($129)
|
($0.24)
|
||
1)
|
Adjustments to reported earnings are included in Corporate and Other segment reported GAAP earnings. Refer to Schedules 2 and 3 for details, or find "GAAP Reconciliation" in the Earnings Release Kit on Dominion Energy's website at www.dominionenergy.com/investors.
|
|||
2)
|
For period over period comparability reconciling items tax effected using a 35 percent federal tax rate. Segment specific tax reform impacts outlined as individual reconciling items.
|
|||
Note: Figures may not add due to rounding
|