EX-99.1 2 ex991_pressrelease.htm EX. 99-1_PRESS RELEASE ex991_pressrelease.htm
 
  
NorthWestern Corporation
d/b/a NorthWestern Energy
3010 W. 69th Street
Sioux Falls, SD  57108
www.northwesternenergy.com
 
NYSE: NWE
News Release
FOR IMMEDIATE RELEASE
 
 
Media Contact:
Claudia Rapkoch
(866) 622-8081
claudia.rapkoch@northwestern.com
 
Investor Relations Contact:
Dan Rausch
(605) 978-2902
daniel.rausch@northwestern.com



NORTHWESTERN REPORTS 2011 FINANCIAL RESULTS

Reports improvement in earnings per share of 19.6% over 2010
Increased the quarterly dividend to 37 cents per share
Provides guidance for 2012 of $2.35 - $2.50 per fully diluted share

SIOUX FALLS, S.D. – Feb. 16, 2012 – NorthWestern Corporation d/b/a NorthWestern Energy (NYSE: NWE) reported financial results for the year ended Dec. 31, 2011.
 
Consolidated net income was $92.6 million, or $2.53 per fully diluted share, for the year ended Dec. 31, 2011, compared with consolidated net income of $77.4 million, or $2.14 per fully diluted share, for the year ended Dec. 31, 2010.  The improvement in net income was due primarily to lower income tax expenses.
 
 
“We produced good results for our shareholders in 2011,” said Bob Rowe, President and CEO. “Our gross margin, operating income and net income all improved compared with 2010. Importantly, during 2011 we made continued progress on investments that reflect our focus on maintaining our system reliability and address our generation supply mix and transmission opportunities.” 
 

Annual Summary Financial Results
   
Three Months Ended
December 31,
  
Twelve Months Ended
December 31,
  
   
2011
  
2010
  
2011
  
2010
  
Total Revenues
  
283,209
  
291,670
  
1,117,316
  
1,110,720
  
Cost of sales
  
124,036
  
140,404
  
494,559
  
531,089
  
Gross Margin
  
159,173
  
151,266
  
622,757
  
579,631
  
Operating Expenses
                  
   Operating, general and administrative
  
63,906
  
63,176
  
267,160
  
237,047
  
   Property and other taxes
  
20,571
  
19,711
  
89,122
  
88,198
  
   Depreciation
  
25,364
  
23,072
  
100,926
  
91,769
  
     Total Operating Expenses
  
109,841
  
105,959
  
457,208
  
417,014
  
Operating Income
  
49,332
  
45,307
  
165,549
  
162,617
  
Interest Expense, net
  
(16,122
)
(16,413
)
(66,859
)
(65,826
)
Other Income
  
1,674
  
1,424
  
3,931
  
6,345
  
Income Before Income Taxes
  
34,884
  
30,318
  
102,621
  
103,136
  
Income Tax Expense
  
(768
)
(7,730
)
(10,065
)
(25,760
)
Net Income
  
$
34,116
  
$
22,588
  
$
92,556
  
$
77,376
  
 
Average Common Shares Outstanding
  
36,271
  
36,217
  
36,258
  
36,190
  
Basic Earnings per Average Common Share
  
$
0.94
  
$
0.63
  
$
2.55
  
$
2.14
  
Diluted Earnings per Average Common Share
  
$
0.93
  
$
0.63
  
$
2.53
  
$
2.14
  
Dividends Declared per Average Common Share
  
$
0.360
  
$
0.340
  
$
1.44
  
$
1.36
  

 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 2



The following table reconciles the primary changes in 2011 results from 2010:

       
Twelve Months Ended
       
Pre-tax
Net
EPS
 
($millions, except EPS)
    
Income
Income(1)
 Diluted
             
 
2010 reported
    
$103.1
$77.4
$2.14
             
Gross Margin
          
 
DGGS interim rates
    
              27.0
              16.6
              0.45
 
Electric retail volumes
    
                6.5
                4.0
              0.11
 
Expiration of a power sales agreement
    
                6.0
                3.7
              0.10
 
Operating Expense recovered in a tracker (margin)
    
                4.5
                2.8
              0.08
 
Natural gas retail volumes
    
                3.5
                2.2
              0.06
 
Montana electric rate increase
    
                3.7
                2.3
              0.06
 
Gas production (margin)
    
                1.5
                0.9
              0.02
 
South Dakota wholesale electric
    
              (0.7)
              (0.4)
            (0.01)
 
Settlement received during 2010
    
              (1.0)
              (0.6)
            (0.02)
 
Montana natural gas rate decrease
    
              (1.0)
              (0.6)
            (0.02)
 
Transmission capacity
    
              (2.8)
              (1.7)
            (0.05)
 
Montana property tax tracker
    
              (3.6)
              (2.2)
            (0.06)
OG&A Expense
          
 
Abandoned gas transmission project
    
              (0.8)
              (0.5)
            (0.01)
 
Gas production (expense)
    
              (0.8)
              (0.5)
            (0.01)
 
Bad debt expense
    
              (1.0)
              (0.6)
            (0.02)
 
Nonemployee directors deferred compensation
    
              (1.1)
              (0.7)
            (0.02)
 
DGGS operating costs
    
              (3.9)
              (2.4)
            (0.07)
 
Plant operator costs
    
              (4.0)
              (2.5)
            (0.07)
 
Operating Expense recovered in a tracker (expense)
    
              (4.5)
              (2.8)
            (0.08)
 
Labor
    
              (5.4)
              (3.3)
            (0.09)
 
Insurance settlements and recoveries
    
              (8.8)
              (5.4)
            (0.15)
Other
            
 
Depreciation expense
    
              (9.1)
              (5.6)
            (0.15)
 
Other Income
    
              (2.4)
              (1.5)
            (0.04)
 
Property and other taxes
    
              (0.9)
              (0.6)
            (0.02)
 
Interest Expense
    
              (1.1)
              (0.7)
            (0.02)
Items related to income tax
          
 
Flow-through of state bonus depreciation deduction
      
                5.3
              0.15
 
Prior year permanent return to accrual adjustment
      
                4.2
              0.11
 
Flow-through repairs deduction
      
                3.7
              0.10
 
Recognition of state NOL benefit
      
                2.4
              0.07
 
All other, net
    
              (0.3)
              (0.3)
($0.01)
             
 
Subtotal
        
              0.39
             
 
2011 reported
    
$102.6
$92.6
$2.53
             
 
(1) Income Tax Benefit (Expense) calculation on reconciling items assumes normal effective tax rate of 38.5%.
 For more information see www.northwesternenergy.com/documents/investor/Q411.pdf

 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 3



Significant Drivers

Gross Margin

Consolidated gross margin for 2011 was $622.8 million compared with $579.6 million for 2010.  The increase in gross margin was due primarily to an increase for interim DGGS rates and an increase in electric and natural gas retail volumes due primarily to warmer summer weather, and colder winter/spring weather; offset by a decrease in Montana property taxes included in a tracker and lower transmission capacity revenues due to a combination of hydro conditions and other factors that decreased demand.

 
Operating, General and Administrative Expenses

Consolidated operating, general and administrative expenses were $267.2 million for the year ended Dec. 31, 2011 as compared with $237.0 million during 2010.  The increase in operating, general and administrative expenses was primarily due to a decrease in insurance settlements and recoveries, increased labor costs, and higher plant operating expenses, due to beginning commercial operations on January 1, 2011at DGGS and scheduled maintenance at the Colstrip Unit 4 and the Big Stone plants.

Income Tax Expense

Consolidated income tax expense in 2011 was $10.1 million as compared with $25.8 million in 2010.  The effective tax rate in 2011 was 9.8% as compared with 25.0% for the same period of 2010.  The effective tax rate differs from the federal tax rate of 35% primarily due to repairs and state tax bonus depreciation deductions.

The following table summarizes the significant differences from the Federal statutory rate, which result in reduced income tax expense:

 
Year Ended December 31,
 
(in millions)
 
2011
  
2010
Income Before Income Taxes
$
102.6
    
$
103.1
  
       
Income tax calculated at 35% Federal statutory rate
(35.9
)
  
(36.1
)
       
Permanent or flow through adjustments:
      
Flow-through repairs deductions
13.4
    
9.7
  
Flow-through of state bonus depreciation deduction
7.6
    
2.3
  
Recognition of state NOL benefit
2.4
    
—
  
Prior year permanent return to accrual adjustments
3.9
    
   (0.3)
  
State income tax & other, net
(1.5
)
  
(1.4
)
 
$
25.8
    
$
10.3
  
       
Income tax expense
$
(10.1
)
  
$
(25.8
)

 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 4



While we reflect an income tax provision in our financial statements, we expect our cash payments for income taxes will be minimal through at least 2015, based on our projected taxable income and anticipated use of consolidated NOL carryforwards.

Regulated Operations

In the regulated operations, electric net income improved $9.7 million, due primarily to an increase in gross margins and a reduction in income tax expense, offset in part by an increase in operating, general, and administrative expenses.  Natural gas net income improved $0.4 million, due primarily to an increase in gross margins and a reduction in income tax expense, offset in part by an increase in operating, general, and administrative expenses.

Fourth Quarter Financial Results

Consolidated net income for the fourth quarter ended Dec. 31, 2011, was $34.1 million, or $.93/share, compared with $22.6 million, or $.63/share for the fourth quarter in 2010.

The increase was primarily due to an increase in gross margin and a significant decrease in income tax expense, when compared with the prior fourth quarter.  Those increases were partially offset by an increase in depreciation and property tax expenses for the fourth quarter.
 
 
Liquidity and Capital Resources

As of Dec. 31, 2011, cash and cash equivalents were $5.9 million compared with $6.2 million at Dec. 31, 2010.  The Company had $130.1 million available from its revolving credit facility at Dec. 31, 2011, compared with $96.5 million at Dec. 31, 2010.

To fund our strategic growth opportunities we intend to utilize available cash flow, debt capacity that would allow us to maintain investment grade ratings, and if necessary additional equity financing.  We plan to maintain a 50 - 55% debt to total capital ratio excluding capital leases.

Dividend Declaration

NorthWestern’s Board of Directors declared a quarterly common stock dividend of 37 cents per share, payable on Mar. 31, 2012, to common shareholders of record as of Mar. 15, 2012.

Update on DGGS Outage

DGGS was shut down on January 31, 2012 and is expected to be down for a period of up to several months following the discovery of a problem within the gas turbines on each of the three generation units.  We expect the turbine repair costs to be covered under the manufacturer's warranty; however, we will also have incremental costs for contracts with third parties for replacement regulation service. We estimate our contracted costs will exceed the variable operating costs of DGGS by up to $0.5 million per month while the plant is down.  We will actively manage our contracted service in an effort to reduce these costs as much as possible as DGGS is brought back into service.  We believe these contracted costs for regulation service are recoverable from customers through our normal course of business; however, there can be no assurance that the MPSC and/or Federal Energy Regulatory Commission will allow us full recovery of such costs.


 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 5



Highlights for 2011

 
•  
Moody’s Investors Services upgraded our senior secured debt from A3 to A2 and our senior unsecured bank credit facility from Baa2 to Baa1;
 
 
•  
Received approval from the Montana Public Service Commission (“MPSC”) of an accounting order to defer certain incremental operating and maintenance costs up to $16.9 million for 2011 and 2012 associated with our Distribution System Infrastructure Project;
 
 
•  
Received approval from the South Dakota Public Utilities Commission to increase our South Dakota natural gas rates resulting in an annualized revenue increase of approximately $1.8 million;
 
 
•  
Signed an asset purchase agreement and requested MPSC approval to develop a 40 MW wind project in central Montana at an estimated cost of approximately $86 million;
 
 
•  
Began construction on a 60 MW peaking facility located in Aberdeen, South Dakota, which we expect to achieve commercial operation before the 2013 summer season; and
 
 
•  
Successfully accessed the capital markets to reduce short-term borrowing costs and extend maturities by;
 
 
 
◦
Entering into a commercial paper program to fund short-term liquidity needs of up to $250 million, and
 
 
 
◦
Increasing our revolving credit facility from $250 million to $300 million and extending the maturity date to June 30, 2016;
 

Significant Items Not Contemplated in 2011 Guidance

A reconciliation of items not factored into our 2011 GAAP earnings guidance of $2.30 to $2.40 per fully diluted earnings per share is as follows (net of tax).  The amount calculated below represents a non-GAAP measure that may provide users of this financial information with additional meaningful comparisons between current results and results the Company originally contemplated in 2011 guidance. Non-GAAP financial measures should be viewed in addition to, and not as an alternative to, the reported operating results or cash flows from operations or any other measure of performance prepared in accordance with GAAP.  In addition, the presentation of these measures may not be comparable to similarly titled measures other companies use.


 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 6



 
         
Q1 2011
Q2 2011
Q3 2011
Q4 2011
  
2011
                     
Reported EPS
      
 $       0.89
 $    0.30
 $       0.41
 $       0.93
  
 $       2.53
                     
Non-GAAP Adjustments:
                
                     
Weather
        
 $    (0.07)
 $        -
 $    (0.01)
 $       0.03
  
 $    (0.05)
High hydro/lower transmission revenue
    
 $    0.05
      
 $       0.05
Income tax adjust - benefit from MT NOL
    
 $ (0.07)
      
 $    (0.07)
Settlement on worker compensation claim
    
 $       0.05
    
 $       0.05
Income tax adjust - return to accrual
        
 $    (0.10)
  
 $    (0.10)
                     
                     
         
 $       0.82
 $    0.28
 $       0.45
 $       0.86
  
 $       2.41




2012 Earnings Outlook

NorthWestern expects its earnings for 2012 to be $2.35 - $2.50 per fully diluted share.

         
 
Bridge
  
2011 Reported GAAP
        
 $  2.53
  
               
Non-GAAP Adjustments
      
Low
  
High
               
2011 favorable weather
      
 $    (0.05)
  
 $    (0.05)
2011 unfavorable weather-hydro conditions
  
 $       0.05
  
 $       0.05
2011 tax adjustments
      
 $    (0.17)
  
 $    (0.17)
Q3 2011 settlement on worker compensation claim
  
 $       0.05
  
 $       0.05
               
2011 adjustments to 2011 GAAP earnings
  
 $    (0.12)
  
 $    (0.12)
               
2011 Adjusted earnings
      
 $      2.41
  
 $      2.41
               
Gross Margin increase over 2011
    
 $       0.25
  
 $       0.30
Operating, General & Admin expense increase over 2011
 $    (0.18)
  
 $    (0.14)
Depreciation expense increase over 2011
  
 $    (0.04)
  
 $    (0.04)
AFUDC increase (interest and equity) over 2011
  
 $       0.05
  
 $       0.07
Income tax expense increase over 2011
    
 $    (0.14)
  
 $    (0.10)
               
Subtotal
        
 $    (0.06)
  
 $       0.09
               
2012 EPS Range
        
 $       2.35
  
 $       2.50

 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 7



Basic assumptions include the following expectations:

·  
A consolidated income tax rate of approximately 18% - 20% of pre-tax income;
·  
No scheduled maintenance at Colstrip Unit 4 and Big Stone Plants;
·  
No expected increase in insurance reserves or insurance recoveries in 2012;
·  
DGGS outage costs fully recovered;
·  
Fully diluted average shares outstanding of 37.0 million; and
·  
Normal weather in the Company’s electric and natural gas service territories for 2012.

Spion Kop Update

On February 14, 2012, the MPSC held a work session on the proposed Spion Kop Wind, LLC wind project and approved the project, but included a condition that would reduce our revenue requirement if the average production failed to meet a minimum threshold for the first three years.  A written order has not yet been issued and we will evaluate our options after we review the MPSC’s written order.

If the MPSC fails to grant approval to the satisfaction of both parties on or before April 1, 2012, then either party may terminate this agreement.  Material construction would not commence until we receive a favorable ruling from the MPSC. Assuming satisfactory approval by April 1, 2012, commercial operation is projected to begin by December 31, 2012.


Company Hosting Investor Conference Call

NorthWestern will host an investor conference call today at 2:00 pm Eastern Time (1:00 p.m. Central Time) to review its financial results for the year ended Dec. 31, 2011.

The conference call will be webcast live on the Internet at http://www.northwesternenergy.com under the “Investor Information” heading.  To listen, please go to the site at least 10 minutes in advance of the call to register.  An archived webcast will be available shortly after the call.
 
 
A telephonic replay of the call will be available beginning at 5:00 p.m. ET on Feb. 16, 2012, through March 16, 2012, at 800-475-6701, access code 235153.

Annual Meeting

The Company's Annual Meeting of Stockholders will be held on Wednesday, April 25, 2012, in Butte, Montana.  The record date for the annual meeting is February 27, 2012.  The annual meeting notice, proxy statement, annual report to stockholders and voting instructions will be provided approximately 40 days prior to the meeting date to stockholders as of the record date.

About NorthWestern Energy

NorthWestern Energy is one of the largest providers of electricity and natural gas in the Upper Midwest and Northwest, serving approximately 668,300 customers in Montana, South Dakota and Nebraska.  More information on NorthWestern Energy is available on the Company's Web site at www.northwesternenergy.com.

 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 8



SPECIAL NOTE REGARDING FORWARD—LOOKING STATEMENTS

This press release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, including, without limitation, the information under “2012 Earnings Outlook”.  Forward-looking statements often address our expected future business and financial performance, and often contain words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” or “will.”  These statements are based upon our current expectations and speak only as of the date hereof.  Our actual future business and financial performance may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, including, but not limited to:

·  
potential adverse federal, state, or local legislation or regulation or adverse determinations by regulators could have a material effect on our liquidity, results of operations and financial condition;
·  
we have capitalized approximately $20.9 million in preliminary survey and investigative costs related to our proposed Mountain States Transmission Intertie transmission project.  If our efforts to complete MSTI are not successful, we may have to write-off all or a portion these costs, which could have a material effect on our results of operations;
·  
changes in availability of trade credit, creditworthiness of counterparties, usage, commodity prices, fuel supply costs or availability due to higher demand, shortages, weather conditions, transportation problems or other developments, may reduce revenues or may increase operating costs, each of which could adversely affect our liquidity and results of operations;
·  
unscheduled generation outages or forced reductions in output, maintenance or repairs, which may reduce revenues and increase cost of sales or may require additional capital expenditures or other increased operating costs; and
·  
adverse changes in general economic and competitive conditions in the U.S. financial markets and in our service territories.

Our Annual Report on Form 10-K, recent and forthcoming Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K and other Securities and Exchange Commission filings discuss some of the important risk factors that may affect our business, results of operations and financial condition. 

We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

# # #

 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 9



 NORTHWESTERN CORPORATION
CONSOLIDATED BALANCE SHEETS
 
(in thousands)
 
     
December 31,
2011
    
December 31, 2010
  
     
(unaudited)
        
ASSETS
              
Current Assets
  
$
290,199
  
$
303,054
  
Property, Plant, and Equipment, Net
    
2,213,267
    
2,117,977
  
Goodwill
    
355,128
    
355,128
  
Regulatory Assets
    
308,804
    
222,341
  
Other Noncurrent Assets
    
43,040
    
39,169
  
Total Assets
  
$
3,210,438
  
$
3,037,669
  
LIABILITIES AND SHAREHOLDERS’ EQUITY
              
Current Maturities of Long-term Debt and Capital Leases
  
$
5,162
  
$
7,854
  
Commercial Paper
    
166,943
    
—
  
Current Liabilities
    
303,858
    
296,115
  
Long-term Capital Leases
    
32,918
    
34,288
  
Long-term Debt
    
905,049
    
1,061,780
  
Noncurrent Regulatory Liabilities
    
265,987
    
251,133
  
Deferred Income Taxes
    
282,406
    
232,709
  
Other Noncurrent Liabilities
    
389,012
    
333,443
  
Total Liabilities
    
2,351,326
    
2,217,322
  
Total Shareholders’ Equity
    
859,112
    
820,347
  
Total Liabilities and Shareholders’ Equity
  
$
3,210,438
  
$
3,037,669
  
 
 
 NORTHWESTERN CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in million)
 
 
Year Ended December 31,
 
2011
  
2010
  
2009
Operating Activities
          
Net income
$
92.6
    
$
77.4
    
$
73.4
  
Non-cash adjustments to net income
167.1
    
137.4
    
137.5
  
Changes in working capital
1.6
    
(1.8
)
  
(40.3
)
Other noncurrent assets and liabilities
(27.5
)
  
5.9
    
(53.8
)
 Cash Provided by Operating Activities
233.8
    
218.9
    
116.8
  
           
Cash Used in Investing Activities
(188.5
)
  
(240.7
)
  
(124.4
)
                 
Cash Provided by (Used in) Financing Activities
(45.5
)
  
23.6
    
(75.4
)
                 
Net Increase (Decrease) in Cash and Cash Equivalents
$
(0.3
)
  
$
1.9
    
$
(1.5
)
Cash and Cash Equivalents, beginning of period
$
6.2
    
$
4.3
    
$
12.8
  
Cash and Cash Equivalents, end of period
$
5.9
    
$
6.2
    
$
11.3
  

 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 10



NORTHWESTERN CORPORATION
 
YEAR ENDED DECEMBER 31, 2011 AND 2010 SEGMENT RESULTS
 
(Unaudited)
(in thousands)
 
 
 
 
December 31, 2011
Electric
  
Gas
  
Other
  
Eliminations
  
Total
Operating revenues
$
797,562
    
$
318,335
    
$
1,419
    
$
—
    
$
1,117,316
  
Cost of sales
327,126
    
167,433
    
—
    
—
    
494,559
  
Gross margin
470,436
    
150,902
    
1,419
    
—
    
622,757
  
Operating, general and administrative
183,503
    
80,431
    
3,226
    
—
    
267,160
  
Property and other taxes
66,425
    
22,686
    
11
    
—
    
89,122
  
Depreciation
81,859
    
19,034
    
33
    
—
    
100,926
  
Operating income
138,649
    
28,751
    
(1,851)
    
—
    
165,549
  
Interest expense
(54,394
)
  
(10,432
)
  
(2,033
)
  
—
    
(66,859
)
Other income
2,563
    
1,258
    
110
    
—
    
3,931
  
Income tax expense
(14,049
)
  
(3,472
)
  
7,456
    
—
    
(10,065
)
Net income (loss)
$
72,769
    
$
16,105
    
$
3,682
    
$
—
    
$
92,556
  
 
 
 
December 31, 2010
Electric
  
Gas
  
Other
  
Eliminations
  
Total
Operating revenues
$
790,701
    
$
318,735
    
$
1,284
    
$
—
    
$
1,110,720
  
Cost of sales
356,325
    
174,764
    
—
    
—
    
531,089
  
Gross margin
434,376
    
143,971
    
1,284
    
—
    
579,631
  
Operating, general and administrative
169,483
    
71,088
    
(3,524
)
  
—
    
237,047
  
Property and other taxes
65,027
    
23,159
    
12
    
—
    
88,198
  
Depreciation
74,227
    
17,509
    
33
    
—
    
91,769
  
Operating income
125,639
    
32,215
    
4,763
    
—
    
162,617
  
Interest expense
(49,576
)
  
(12,608
)
  
(3,642
)
  
—
    
(65,826
)
Other income
5,954
    
284
    
107
    
—
    
6,345
  
Income tax expense
(18,939
)
  
(4,183
)
  
(2,638
)
  
—
    
(25,760
)
Net income (loss)
$
63,078
    
$
15,708
    
$
(1,410
)
  
$
—
    
$
77,376
  
 
 
 
 

 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 11



NORTHWESTERN CORPORATION
 
REGULATED ELECTRIC SEGMENT
 
(Unaudited)
 
 
 
Results
 
2011
  
2010
  
Change
  
% Change
 
(in millions)
Retail revenue
$
729.7
    
$
663.3
    
$
66.4
    
10.0
%
Transmission
44.1
    
47.0
    
(2.9
)
  
(6.2
)
Wholesale
1.9
    
45.0
    
(43.1
)
  
(95.8
)
Regulatory Amortization and Other
21.8
    
35.4
    
(13.6
)
  
(38.4
)
Total Revenues
797.5
    
790.7
    
6.8
    
0.9
  
Total Cost of Sales
327.1
    
356.3
    
(29.2
)
  
(8.2
)%
Gross Margin
$
470.4
    
$
434.4
    
$
36.0
    
8.3
%
 
 
 
 
Revenues
  
Megawatt Hours (MWH)
  
Avg. Customer Counts
 
2011
  
2010
  
2011
  
2010
  
2011
  
2010
 
(in thousands)
        
Retail Electric
                      
Montana
$
250,988
    
$
223,813
    
2,394
    
2,323
    
272,131
    
270,536
  
South Dakota
46,869
    
44,896
    
565
    
555
    
48,685
    
48,479
  
   Residential
297,857
    
268,709
    
2,959
    
2,878
    
320,816
    
319,015
  
Montana
302,591
    
274,017
    
3,197
    
3,149
    
61,571
    
61,003
  
South Dakota
65,614
    
63,508
    
919
    
920
    
11,946
    
11,796
  
Commercial
368,205
    
337,525
    
4,116
    
4,069
    
73,517
    
72,799
  
Industrial
37,378
    
32,927
    
2,833
    
2,746
    
72
    
71
  
Other
26,298
    
24,124
    
170
    
163
    
5,875
    
5,874
  
Total Retail Electric
$
729,738
    
$
663,285
    
10,078
    
9,856
    
400,280
    
397,759
  
Wholesale Electric
                      
Montana
$
—
    
$
40,486
    
—
    
788
    
N/A
  
N/A
South Dakota
1,928
    
4,503
    
106
    
220
    
N/A
  
N/A
Total Wholesale Electric
$
1,928
    
$
44,989
    
106
    
1,008
    
—
    
—
  
 
 
 
 
 
Degree Days
  
2011 as compared with:
Cooling Degree-Days
2011
  
2010
  
Historic Average
  
2010
  
Historic Average
Montana
328
    
221
    
302
    
48% warmer
  
9% warmer
South Dakota
862
    
832
    
746
    
4% warmer
  
16% warmer

 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 12



 
 
Degree Days
  
2011 as compared with:
Heating Degree-Days
2011
  
2010
  
Historic Average
  
2010
  
Historic Average
Montana
8,094
    
8,004
    
8,041
    
  1% colder
  
  1% colder
South Dakota
8,074
    
7,727
    
7,717
    
4% colder
  
5% colder
 
 
 
 
 
 

 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 13



NORTHWESTERN CORPORATION
 
REGULATED NATURAL GAS SEGMENT
 
(Unaudited)
 
 
 
 
 
Results
 
2011
  
2010
  
Change
  
% Change
 
(in millions)
Retail revenue
$
274.8
    
$
268.0
    
$
6.8
    
2.5
%
Wholesale and other
43.5
    
50.7
    
(7.2
)
  
(14.2
)
Total Revenues
318.3
    
318.7
    
(0.4
)
  
(0.1
)
Total Cost of Sales
167.4
    
174.8
    
(7.4
)
  
(4.2
)
Gross Margin
$
150.9
    
$
143.9
    
$
7.0
    
4.9
%
 
 
 
 
Revenues
  
Dekatherms (Dkt)
  
Customer Counts
 
2011
  
2010
  
2011
  
2010
  
2011
  
2010
 
(in thousands)
        
Retail Gas
                      
Montana
$
124,001
    
$
115,570
    
13,170
    
12,635
    
158,514
    
157,764
  
South Dakota
25,633
    
26,342
    
2,918
    
2,787
    
37,515
    
37,263
  
Nebraska
23,855
    
24,653
    
2,605
    
2,624
    
36,586
    
36,515
  
Residential
173,489
    
166,565
    
18,693
    
18,046
    
232,615
    
231,542
  
Montana
63,346
    
58,142
    
6,787
    
6,400
    
22,176
    
22,023
  
South Dakota
18,591
    
22,175
    
2,665
    
3,044
    
5,915
    
5,890
  
Nebraska
16,915
    
18,537
    
2,668
    
2,838
    
4,586
    
4,553
  
Commercial
98,852
    
98,854
    
12,120
    
12,282
    
32,677
    
32,466
  
Industrial
1,464
    
1,702
    
162
    
194
    
278
    
285
  
Other
1,044
    
871
    
126
    
109
    
147
    
146
  
Total Retail Gas
$
274,849
    
$
267,992
    
31,101
    
30,631
    
265,717
    
264,439
  
 
 
 
Degree Days
  
2011 as compared with:
Heating Degree-Days
2011
  
2010
  
Historic Average
  
2010
  
Historic Average
Montana
8,094
    
8,004
    
8,041
    
  1% colder
  
  1% colder
South Dakota
8,074
    
7,727
    
7,717
    
4% colder
  
5% colder
Nebraska
6,493
    
6,412
    
6,375
    
  1% colder
  
  2% colder
 
 
 

 
 
 
NorthWestern Reports 2011 Financial Results
Feb. 16, 2012
Page 14



NORTHWESTERN CORPORATION
 
FOURTH QUARTER SEGMENT RESULTS
 
(Unaudited)
 
(in thousands)
 
 
Three Months Ended December 31, 2011
 
 
December 31, 2011
Electric
  
Gas
  
Other
  
Eliminations
  
Total
Operating revenues
$
195,538
    
$
87,364
    
$
307
    
$
—
    
$
283,209
  
Cost of sales
80,534
    
43,502
    
—
    
—
    
124,036
  
Gross margin
115,004
    
43,862
    
307
    
—
    
159,173
  
Operating, general and administrative
43,235
    
19,781
    
890
    
—
    
63,906
  
Property and other taxes
15,488
    
5,080
    
3
    
—
    
20,571
  
Depreciation
20,656
    
4,701
    
7
    
—
    
25,364
  
Operating income
35,625
    
14,300
    
(593
)
  
—
    
49,332
  
Interest expense
(13,518
)
  
(2,327
)
  
(277
)
  
—
    
(16,122
)
Other income (loss)
1,140
    
507
    
27
    
—
    
1,674
  
Income tax expense
5,496
    
(3,191
)
  
(3,073
)
  
—
    
(768
)
Net income (loss)
$
28,743
    
$
9,289
    
$
(3,916
)
  
$
—
    
$
34,116
  
 
 
 
 
Three Months Ended December 31, 2010
 
 
December 31, 2010
Electric
  
Gas
  
Other
  
Eliminations
  
Total
Operating revenues
$
198,439
    
$
92,853
    
$
378
    
$
—
    
$
291,670
  
Cost of sales
90,274
    
50,130
    
—
    
—
    
140,404
  
Gross margin
108,165
    
42,723
    
378
    
—
    
151,266
  
Operating, general and administrative
45,262
    
18,634
    
(720
)
  
—
    
63,176
  
Property and other taxes
14,403
    
5,305
    
3
    
—
    
19,711
  
Depreciation
18,664
    
4,400
    
8
    
—
    
23,072
  
Operating income
29,836
    
14,384
    
1,807
    
—
    
45,307
  
Interest expense
(12,267
)
  
(2,891
)
  
(1,255
)
  
—
    
(16,413
)
Other income (loss)
1,439
    
(42)
    
27
    
—
    
1,424
  
Income tax expense
(1,449
)
  
(3,142
)
  
(3,139
)
  
—
    
(7,730
)
Net income (loss)
$
17,559
    
$
8,309
    
$
(3,280
)
  
$
—
    
$
22,588