-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LDqu9QPSHC4Fg0NhwHA/zvUD3R4xh8DUd+mG6yJ9GhSFQlzPEmpfPfSoA88CYBI3 ez8yDfKL1o7BLou+A63Xmg== 0000072741-04-000164.txt : 20041115 0000072741-04-000164.hdr.sgml : 20041115 20041115162023 ACCESSION NUMBER: 0000072741-04-000164 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20041115 ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Other Events ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20041115 DATE AS OF CHANGE: 20041115 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NORTHEAST UTILITIES SYSTEM CENTRAL INDEX KEY: 0000072741 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 042147929 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-05324 FILM NUMBER: 041145526 BUSINESS ADDRESS: STREET 1: 174 BRUSH HILL AVE CITY: WEST SPRINGFIELD STATE: MA ZIP: 01090-0010 BUSINESS PHONE: 4137855871 MAIL ADDRESS: STREET 1: 107 SELDEN ST CITY: BERLIN STATE: CT ZIP: 06037-1616 8-K 1 nu8k111504.txt NU 8-K 111504 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549-1004 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) November 15, 2004 ------------------- NORTHEAST UTILITIES -------------------- (Exact name of registrant as specified in its charter) MASSACHUSETTS 1-5324 04-2147929 ------------------------- --------- --------------- (State or other jurisdiction of (Commission (I.R.S. Employer organization) File Number) Identification No.) ONE FEDERAL STREET, BUILDING 111-4, SPRINGFIELD MASSACHUSETTS 01105 ----------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (413) 785-5871 (Registrant's telephone number, including area code) Not Applicable -------------- (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): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d- 2(b) under the Exchange Act (17 CFR 240.14d- 2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e- 4(c)) Section 7 - Regulation FD Item 7.01 Regulation FD Disclosure Northeast Utilities is furnishing slides presented to the Wall Street Utility Group on November 15, 2004 under Regulation FD. Such slides are attached as 99.2, and are incorporated herein. The information contained in Exhibit 99.2 shall not be deemed "filed" with the Securities and Exchange Commission nor incorporated by reference in any registration statement filed by Northeast Utilities under the Securities Act of 1933, as amended, unless specified otherwise. Section 8 - Other Events Item 8.01 Other Events On November 15, 2004, Northeast Utilities issued a news release announcing that it had lowered its projected 2005 earnings range to between $1.10 per share and $1.25 per share. NU's previous earnings range for 2005 had been between $1.35 per share and $1.45 per share. NU's earnings projections for 2004 remain between $1.25 per share and $1.35 per share. A copy of the news release is attached as Exhibit 99.1, and is incorporated herein. Section 9 - Financial Statements and Exhibits Item 9.01 Financial Statements and Exhibits (c) Exhibits Exhibit Description Exhibit 99.1 Northeast Utilities News Release dated November 15, 2004. Exhibit 99.2 Slide Presentation made before the Wall Street Utility Group on November 15, 2004. [SIGNATURE PAGE TO FOLLOW] SIGNATURE Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. NORTHEAST UTILITIES (Registrant) By: /s/ Randy A. Shoop Name: Randy A. Shoop Title: Assistant Treasurer - Finance Date: November 15, 2004 EX-99 2 nu8kexh991111504.txt EXHIBIT 99.1 NU NEWS RELEASE 111504 Exhibit 99.1 Contact: Jeffrey R. Kotkin Office: (860) 665-5154 NU LOWERS 2005 EARNINGS GUIDANCE BERLIN, Connecticut, November 15, 2004-Northeast Utilities (NU-NYSE) today lowered its projected 2005 earnings range to between $1.10 per share and $1.25 per share. NU's previous earnings range for 2005 had been between $1.35 per share and $1.45 per share. NU's earnings projections for 2004 remain between $1.25 per share and $1.35 per share. The company estimates that in 2005 its competitive businesses as a whole, including its energy services businesses, will earn in a range of $10 million to minus $5 million. NU had previously estimated that the competitive business earnings would be between $33 million and $39 million. The ability of the competitive businesses to achieve the revised earnings projections assumes that Select Energy, Inc., NU's merchant energy marketing subsidiary, is able to realize previously experienced success levels for the remaining opportunities throughout the Northeast. NU estimates that in 2005 its merchant energy businesses will earn in a range of $4 million to minus $9 million. Projected earnings for the balance of its competitive businesses and for NU's regulated businesses have not changed. NU said it was lowering the range for its competitive businesses because of highly competitive bidding conditions that resulted in Select Energy winning less 2005 wholesale load and at lower margins than anticipated in New England. Last week, Select Energy was informed that it did not win any of the competitively bid 5,000 megawatt standard offer load of The Connecticut Light and Power Company (CL&P), NU's largest regulated subsidiary. Select Energy is supplying CL&P with 37.5 percent of its standard offer requirements in 2004. In addition, adverse movements in commodity prices negatively affected positions taken in anticipation of achieving targeted sales goals. In light of these developments, NU is reevaluating its methods of bidding for large, full-requirements electric load. Given the remaining contracts that are still to be bid for 2005, it appears very unlikely that NU will be able to achieve its initial guidance. Currently, Select Energy's New England wholesale contracts provide the marketing company with the majority of its profit margin. NU said that it continues to believe that other segments of its competitive business, including the wholesale merchant business outside of New England, retail energy contracts with approximately 30,000 electric and natural gas commercial and industrial accounts in the Northeast, and its energy services businesses, will be profitable in 2005. NU continues to estimate that its regulated businesses will earn between $1.22 per share and $1.30 per share in 2005. NU now believes that parent and other expenses, tempered by cost management initiatives, will range between $0.08 per share and $0.13 per share in 2005. Previously, NU had said that it will incur parent and other expenses of between $0.13 cents per share and $0.15 per share in 2005. "We are extremely disappointed with the level of New England wholesale business we have secured for 2005 and the reduced level of profitability that means for NU as a whole," said Charles W. Shivery, NU chairman, president and chief executive officer. "We will commence an effort to identify and implement initiatives to improve our projected financial performance in 2005 and beyond, including cost reduction efforts. We will update investors on these initiatives throughout 2005." NU said that it continues to believe that the primary driver of future earnings and dividend growth is investment in regulated infrastructure that is required to meet customer load growth and reliability requirements. NU continues to evaluate the level of earnings and dividends that its competitive businesses will contribute to that growth. The company has projected that its competitive businesses will contribute steadily increasing earnings and more than $200 million of dividends to parent company cash needs through 2009. If the 2005 bidding outcome is indicative of lower future cash generation and earnings by those businesses and if NU's regulated investment plans are not changed, future consolidated earnings would be negatively impacted. NU's ability to achieve earnings and dividend growth above the industry average through 2009 could also be impacted, and NU could have to seek additional external financing for its planned expenditures in that period. NU has approximately 128 million common shares outstanding. Its regulated companies serve approximately 2 million electric and natural gas delivery customers in Connecticut, New Hampshire and Massachusetts. This news release includes statements concerning the Company's expectations, plans, objectives, future financial performance and other statements that are not historical facts. These statements are "forward looking statements" within the meaning of the Private Litigation Reform Act of 1995. In some cases the reader can identify these forward looking statements by words such as "estimate", "expect", "anticipate", "intend", "plan", "believe", "forecast", "should", "could", and similar expressions. Forward looking statements involve risks and uncertainties that may cause actual results or outcomes to differ materially from those included in the forward looking statements. Factors that may cause actual results to differ materially from those included in the forward looking statements include, but are not limited to, actions by state and federal regulatory bodies, competition and industry restructuring, changes in economic conditions, changes in weather patterns, changes in laws, expiration or initiation of significant energy supply contracts, regulations or regulatory policy, levels of capital expenditures, developments in legal or public policy doctrines, technological developments, volatility in electric and natural gas commodity markets, and other presently unknown or unforeseen factors. Other risk factors are detailed from time to time in our reports to the Securities and Exchange Commission. We undertake no obligation to update the information contained in any forward looking statements to reflect developments or circumstances occurring after the statements are made. # # # # EX-99 3 nu8kexh992111504.txt EXHIBIT 99.2 SLIDES 11-15-04 Exhibit 99.2 SLIDE 1 NU LOGO Northeast Utilities System Wall Street Utility Group New York, NY November 15, 2004 SLIDE 2 Safe Harbor Provisions This presentation includes statements concerning the Company's expectations, plans, objectives, future financial performance and other statements that are not historical facts. These statements are "forward looking statements" within the meaning of the Private Litigation Reform Act of 1995. In some cases the reader can identify these forward looking statements by words such as "estimate", "expect", "anticipate", "intend", "plan", "believe", "forecast", "should", "could", and similar expressions. Forward looking statements involve risks and uncertainties that may cause actual results or outcomes to differ materially from those included in the forward looking statements. Factors that may cause actual results to differ materially from those included in the forward looking statements include, but are not limited to, actions by state and federal regulatory bodies, competition and industry restructuring, changes in economic conditions, changes in weather patterns, changes in laws, expiration or initiation of significant energy supply contracts, regulations or regulatory policy, levels of capital expenditures, developments in legal or public policy doctrines, technological developments, volatility in electric and natural gas commodity markets, and other presently unknown or unforeseen factors. Other risk factors are detailed from time to time in our reports to the Securities and Exchange Commission. We undertake no obligation to update the information contained in any forward looking statements to reflect developments or circumstances occurring after the statement is made. SLIDE 3 Topics for Today - ---------------- - - 2005 earnings guidance and drivers - - Competitive businesses - - Regulated investment plans - - 2004 - Financial results - Earnings guidance SLIDE 4 Projected 2005 Results - ---------------------- Key Drivers Regulated Distribution ------------ & Generation $0.96 - $1.00 - Sales Growth - Increased Investment - Rate Increases Transmission $0.26 - $0.30 - Increased Investment Competitive ($0.04) - $0.08 - Lower New England wholesale sales Parent, Other & Cost Initiatives ($0.08) - ($0.13) Total Northeast Utilities $1.10 - $1.25 SLIDE 5 Competitive Businesses - ---------------------- Net Income 2003* 2004 2005 ($ Millions) Actual Estimate Estimate Merchant $30 $29 - $31 ($9) - $4 Services $2 $ 1 - $2 $4 - $6 Total $32 $30 - $33 ($5) - $10 * Excludes $36 million SMD write-off SLIDE 6 NU's Regulated Businesses Have More Certainty Today - --------------- Distribution/ Regulated Generation Transmission ---------- ------------ - - CL&P 4-year rate case Done - FERC rate case Done - - PSNH rate case Done - Appeal of Bethel- Norwalk Done - - Yankee rate case Settlement - Agreement to Pending replace 1385 Approval line to Long Island In place - - PSNH Northern Wood Project Approved - - Yankee LNG project Approved SLIDE 7 Summary of Rate Plans - --------------------- Allowed Start End Rate Increase ROE ----- --- ------------ --- CL&P 1/1/05 12/31/05 $25.1 M 9.85% Distribution 1/1/06 12/31/06 $11.9 M 1/1/07 12/31/07 $ 7.0 M PSNH Delivery 10/1/04 5/31/05 $ 3.5 M N/A 6/1/05 N/A $10.0 M Yankee Gas Delivery* 1/1/05 Mid 2007 $14.0 M 9.9% Transmission 1/1/05 12/31/05 $18-$20 M 11.0% *Settlement pending SLIDE 8 Regulated Strategic Plan - ------------------------ New England customers require: NU shareholders can benefit from: - ----------------------------- -------------------------------- - - Expanded transmission system - Increased investment opportunities - - Upgraded distribution - Solid earnings facilities growth - - Increased local natural gas - Strong credit storage profile - - Reduced power plant emissions SLIDE 9 Regulated Projects - ------------------ On-going Projects [Picture of transmission ----------------- line] - CL&P distribution $225 million/yr. SW CT Transmission $1 billion - PSNH distribution & generation $ 80 million/yr. [Picture of LNG - Transmission $ 60 million/yr. facility] Yankee Gas LNG - Yankee distribution $ 40 million/yr. $100 million - WMECO distribution $ 30 million/yr. [Picture of PSNH --------------------------------------------- facility] Total: $435 million/yr. PSNH Northern Wood $75 million SLIDE 10 Capital Investments Will Exceed Depreciation - -------------------------------------------- Bar Chart comparing Capital Expenditures to Depreciation, measured in millions of $ 2003 2004 2005 2006 2007 Actual Projected Projected Projected Projected ------ --------- --------- --------- ---------- Cap Ex $550 $638 $753 $765 $667 Depreciation $204 $239 $242 $261 $283 2008 2009 Projected Projected --------- --------- Cap Ex $822 $729 Depreciation $302 $326 SLIDE 11 Regulated Rate Base - ------------------- Bar chart illustrating Regulated Rate Base Cost broken down by Distribution and Generation and Transmission, measured in millions of $ 2004 2005 2006 2007 Projected Projected Projected Projected --------- --------- --------- --------- Distribution and Generation $2551.4 $2794.0 $3081.6 $3448.8 Transmission $ 486.4 $494.7 $ 780.6 $ 859.9 2008 2009 Projected Projected --------- --------- Distribution and Generation $3674.9 $3867.2 Transmission $1033.5 $1686.1 SLIDE 12 Today's Balance Sheet - --------------------- Bar chart measuring percentage of leveraged debt, broken down by total debt (excluding RRBs), Preferred and Common Stock, by subsidiaries NU Consol. CL&P PSNH WMECO** ------- ---- ---- ------- Total Debt (Excludes RRBs) 54.6% 54.9% 55.0% 53.8% Preferred 2.2% 5.8% 0.0% 0.0% Common 43.2% 39.3% 45.0% 46.2% Yankee Gas* NGC ---- --- Total Debt (Excludes RRBs) 53.7% 45.4% Preferred 0.0% 0.0% Common 46.3% 54.6% *Excludes acquisition premium **Excludes $50 million issue to fund prior spent nuclear fuel trust SLIDE 13 Cash Requirements 2005-2009 - --------------------------- Pie chart showing cash requirements for the period from 2005-2009 (shown in billions of $) Billions $ --------- Net New Financing $ 1.8 Depreciation $ 1.4 Non-RRB $ 0.3 Amortization Earnings Deferred Taxes & Other $ 0.9* Total: $ 4.4 *NU has projected that its competitive businesses will contribute steadily increasing earnings and more than $200 million of dividends to parent company cash needs through 2009. If the 2005 New England wholesale bidding outcome is indicative of lower future cash generation and earnings by those businesses and if NU's regulated investment plans are not changed, future consolidated earnings would be negatively impacted. NU could have to seek additional external financing for its planned expenditures in that period. SLIDE 14 Projected 2004 Results - ---------------------- Regulated Distribution & Generation $0.91 - $0.95 Transmission $0.22 - $0.24 Competitive $0.23 - $0.25 Parent & Other ($0.11) - ($0.09) Total Northeast Utilities $1.25 - $1.35 SLIDE 15 NU's Investment Thesis - ---------------------- - - Unique opportunity to invest in needed energy delivery infrastructure - - Balance sheet capable of sustaining major investments - - Solid earnings and dividend growth - - Competitive businesses that need to rebound after prospects for a disappointing 2005 SLIDE 16 Questions and Answers ------- -----END PRIVACY-ENHANCED MESSAGE-----