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) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933
(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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Emerging growth company ☐
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Common Stock, no par value
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D
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New York Stock Exchange
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2016 Series A 6.75% Corporate Units
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DCUD
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New York Stock Exchange
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2016 Series A 5.25% Enhanced Junior Subordinated Notes
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DRUA
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New York Stock Exchange
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Exhibit
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99
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DOMINION ENERGY, INC.
Registrant |
/s/ James R. Chapman
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James R. Chapman
Executive Vice President,
Chief Financial Officer and Treasurer
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·
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First-quarter 2019 GAAP reported net loss of $0.86 per share primarily attributable to charges related to SCANA
merger commitments
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·
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First-quarter 2019 operating earnings of $1.10 per share
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·
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Company affirms 2019 operating earnings guidance of $4.05 to $4.40 per share
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Dominion Energy, Inc.
Consolidated Statements of Income *
Unaudited (GAAP Based)
(millions, except per share amounts)
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||||
Three Months Ended
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||||
March 31,
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||||
2019
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2018
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|||
Operating Revenue
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$ 3,858
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$ 3,466
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||
Operating Expenses
|
||||
Electric fuel and other energy-related purchases
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791
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744
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||
Purchased electric capacity
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39
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14
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||
Purchased gas
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730
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340
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||
Other operations and maintenance 1
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1,837
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796
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Depreciation, depletion and amortization
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651
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498
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Other taxes
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292
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199
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||
Total operating expenses
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4,340
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2,591
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Income (loss) from operations
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(482)
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875
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||
Other income
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388
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100
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||
Interest and related charges
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469
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314
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||
Income (loss) from operations including noncontrolling interests before income tax expense
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(563)
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661
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||
Income tax expense
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114
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135
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||
Net Income (Loss) Including Noncontrolling Interests
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(677)
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526
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Noncontrolling Interests
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3
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23
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||
Net Income (Loss) Attributable to Dominion Energy
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$ (680)
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$ 503
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Earnings Per Common Share
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||||
Net income (loss) attributable to Dominion Energy - Basic
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$ (0.86)
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$ 0.77
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Net income (loss) attributable to Dominion Energy - Diluted
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(0.86)
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0.77
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1Includes impairment of assets and other charges.
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* 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
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||||||||
Unaudited
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||||||||
(millions, except earnings per share)
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Three months ended March 31,
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|||||||
2019
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2018
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Change
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||||||
REPORTED EARNINGS 1
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$ (680)
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$ 503
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$ (1,183)
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|||||
Pre-tax loss (income) 2
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1,640
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305
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1,335
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|||||
Income tax 2
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(87)
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(67)
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(20)
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|||||
Adjustments to reported earnings
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1,553
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238
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1,315
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|||||
OPERATING EARNINGS
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$ 873
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$ 741
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$ 132
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|||||
By segment:
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||||||||
Power Delivery
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155
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156
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(1)
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|||||
Power Generation
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308
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348
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(40)
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|||||
Gas Infrastructure
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359
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327
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32
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|||||
Southeast Energy 3
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132
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-
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132
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|||||
Corporate and Other
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(81)
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(90)
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9
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|||||
$ 873
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$ 741
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$ 132
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||||||
Earnings Per Share (EPS):
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||||||||
REPORTED EARNINGS 1
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$ (0.86)
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$ 0.77
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$ (1.63)
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|||||
Adjustments to reported earnings (after tax)
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1.96
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0.37
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1.59
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|||||
OPERATING EARNINGS
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$ 1.10
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$ 1.14
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$ (0.04)
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|||||
By segment:
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||||||||
Power Delivery
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0.19
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0.24
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(0.05)
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|||||
Power Generation
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0.39
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0.54
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(0.15)
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|||||
Gas Infrastructure
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0.45
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0.50
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(0.05)
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|||||
Southeast Energy 3
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0.17
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-
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0.17
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|||||
Corporate and Other
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(0.10)
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(0.14)
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0.04
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|||||
$ 1.10
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$ 1.14
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$ (0.04)
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||||||
Common Shares Outstanding (average, diluted)
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793.1
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650.5
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||||||
1)
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Determined in accordance with Generally Accepted Accounting Principles (GAAP).
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|||||||
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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|||||||
3)
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New operating segment established in January 2019, in connection with Dominion Energy's merger with SCANA.
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·
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$1.4 billion of merger and integration-related costs associated with the SCANA Combination, including a $1 billion charge for refunds
of amounts previously collected from retail electric customers of Dominion Energy South Carolina (DESC) for the NND Project, a $105 million charge related to certain property plant and equipment associated with the NND Project for which
Dominion Energy committed to forgo recovery, and a $169 million charge related to a settlement agreement of a DESC ratepayer class action lawsuit.
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·
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$547 million charge associated with Virginia utility asset retirements, primarily electric generation facilities in cold reserve and
certain automated meters.
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·
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$113 million benefit from the revision of certain asset retirement obligations for ash ponds and landfills at certain utility
generation facilities, in connection with the enactment of Virginia legislation in March.
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·
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$253 million net gain related to our investments in nuclear decommissioning trust funds.
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(millions, except per share amounts)
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1Q19
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2Q19
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3Q19
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4Q19
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YTD 2019
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Reported earnings
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($680)
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($680)
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||||
Adjustments to reported earnings 1:
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||||||
Pre-tax loss (income)
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1,640
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1,640
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||||
Income tax
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(87)
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(87)
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||||
1,553
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1,553
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|||||
Operating earnings
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$873
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$873
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||||
Common shares outstanding (average, diluted)
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793.1
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793.1
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||||
Reported earnings per share
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($0.86)
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($0.86)
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||||
Adjustments to reported earnings (after-tax)
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1.96
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1.96
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Operating earnings per share
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$1.10
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$1.10
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||||
1) Adjustments to reported earnings are reflected in the following table:
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||||||
1Q19
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2Q19
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3Q19
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4Q19
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YTD 2019
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Pre-tax loss (income):
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||||||
Merger and integration-related costs
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1,429
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1,429
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Virginia utility asset retirements
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547
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547
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Revision to ash pond and landfill closure costs
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(113)
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(113)
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Net gain on NDT funds
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(253)
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(253)
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Other
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30
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30
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||||
$1,640
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$1,640
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|||||
Income tax expense (benefit):
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||||||
Tax effect of above adjustments to reported earnings *
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(255)
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(255)
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Write-off EDIT regulatory assets (SCANA)
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198
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198
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Other
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(30)
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(30)
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($87)
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($87)
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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.
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·
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$759 million net benefit associated with the sales of our non-core assets, primarily reflecting the gains on sales of certain merchant
generation assets and our investment in Blue Racer.
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·
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$219 million impairment charge associated with gathering and processing assets.
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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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$170 million net loss related to our investments in nuclear decommissioning trust funds.
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·
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$124 million charge associated with disallowance of FERC-regulated plant.
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·
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$81 million charge associated with the asset retirement obligations for ash ponds and landfills at certain utility generation
facilities in connection with the enactment of Virginia legislation in April.
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·
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$74 million of restoration costs associated with major storms, primarily affecting our Virginia service territory.
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·
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$37 million of transaction and transition costs associated with the Dominion Energy Questar combination and the acquisition of SCANA
Corporation.
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(millions, except per share amounts)
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1Q18
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2Q18
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3Q18
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4Q18
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YTD 2018
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2
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Reported earnings
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$503
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$449
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$854
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$641
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$2,447
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||
Adjustments to reported earnings 1:
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|||||||
Pre-tax loss (income)
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305
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145
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(199)
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(50)
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201
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Income tax expense (benefit)
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(67)
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(34)
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103
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1
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3
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238
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111
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(96)
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(49)
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204
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|||
Operating earnings
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$741
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$560
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$758
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$592
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$2,651
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Common shares outstanding (average, diluted)
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650.5
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653.1
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654.9
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660.9
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654.9
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Reported earnings per share
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$0.77
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$0.69
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$1.30
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$0.97
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$3.74
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Adjustments to reported earnings (after-tax)
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0.37
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0.17
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(0.15)
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(0.08)
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0.31
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Operating earnings per share
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$1.14
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$0.86
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$1.15
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$0.89
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$4.05
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1) Adjustments to reported earnings are reflected in the following table:
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|||||||
1Q18
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2Q18
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3Q18
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4Q18
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YTD 2018
|
|||
Pre-tax loss (income):
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|||||||
Sale of non-core assets
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(70)
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(689)
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(759)
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||||
Impairment of gathering & processing assets
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219
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219
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|||||
Impact of Virginia rate legislation
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215
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215
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|||||
Net (gain) loss on NDT funds
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43
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(50)
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(149)
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326
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170
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||
FERC-regulated plant disallowance
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122
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2
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124
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||||
Future ash pond and landfill closure costs
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81
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81
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|||||
Storm costs
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31
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43
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74
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||||
Merger-related transaction and transition costs
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16
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9
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3
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9
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37
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Other
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(17)
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15
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42
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40
|
|||
$305
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$145
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($199)
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($50)
|
$201
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|||
Income tax expense (benefit):
|
|||||||
Tax effect of above adjustments to reported earnings *
|
(67)
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(34)
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38
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11
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(52)
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Re-measurement of Deferred Tax balances **
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47
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(1)
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46
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||||
Valuation Allowance ***
|
18
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(9)
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9
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||||
($67)
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($34)
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$103
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$1
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$3
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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. | |||||||
** During 2018, the Companies recorded further adjustments to deferred taxes in accordance with recently released tax reform guidance
and to revise estimates made at year-end 2017.
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*** In 3Q18, a valuation allowance was established against the portion of a deferred tax asset associated with the non-core assets that
was no longer projected of being utilized to offset future taxable income. In 4Q18, the amount was adjusted based on management's assessment that it is more-likely-than-not that a portion of the deferred tax asset would be realized in 2018,
to reduce tax expense associated with the sale.
|
|||||||
2) YTD EPS may not equal sum of quarters due to share count difference.
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Schedule 4 - Reconciliation of 1Q19 Earnings to 1Q18
|
|||
Preliminary, Unaudited
|
Three Months Ended
March 31,
2019 vs. 2018
Increase / (Decrease)
|
||
(millions, except EPS)
|
|||
Reconciling Items
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Amount
|
EPS
|
|
Change in reported earnings (GAAP)
|
($1,183)
|
($1.63)
|
|
Change in Pre-tax loss (income) 1
|
1,335
|
||
Change in Income tax 1
|
(20)
|
||
Adjustments to reported earnings
|
$1,315
|
$1.59
|
|
Change in consolidated operating earnings
|
$132
|
($0.04)
|
|
Power Delivery
|
|||
Regulated electric sales:
|
|||
Weather
|
($8)
|
($0.01)
|
|
Other
|
3
|
—
|
|
Rider investment
|
12
|
0.02
|
|
Other
|
(8)
|
(0.01)
|
|
Share dilution
|
(0.05)
|
||
Change in contribution to operating earnings
|
($1)
|
($0.05)
|
|
Power Generation
|
|||
Regulated electric sales:
|
|||
Weather
|
($16)
|
($0.03)
|
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Other
|
(4)
|
(0.01)
|
|
Electric capacity
|
(11)
|
(0.02)
|
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Sale of merchant generation facilities
|
(14)
|
(0.02)
|
|
Other
|
5
|
0.01
|
|
Share dilution
|
(0.08)
|
||
Change in contribution to operating earnings
|
($40)
|
($0.15)
|
|
Gas Infrastructure
|
|||
Cove Point
|
$112
|
$0.17
|
|
Farmout transactions
|
(32)
|
(0.05)
|
|
Interest
|
(50)
|
(0.07)
|
|
Other
|
2
|
—
|
|
Share dilution
|
(0.10)
|
||
Change in contribution to operating earnings
|
$32
|
($0.05)
|
|
Southeast Energy
|
$132
|
$0.17
|
|
Corporate and Other
|
|||
Share dilution and other
|
$9
|
$0.04
|
|
Change in contribution to operating earnings
|
$9
|
$0.04
|
|
Change in consolidated operating earnings
|
$132
|
($0.04)
|
|
Change in adjustments included in reported earnings1
|
($1,315)
|
($1.59)
|
|
Change in consolidated reported earnings
|
($1,183)
|
($1.63)
|
|
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.
|
||
Note: Figures may not add due to rounding
|