EX-99 2 exhibit99.htm EXHIBIT 99 Exhibit 99

Exhibit 99

FPL Group, Inc.
Corporate Communications Dept.
Media Line: (305) 552-3888
October 27, 2008

FOR IMMEDIATE RELEASE

 

NOTE TO EDITORS: This news release reflects the earnings report of FPL Group, Inc. Reference to the corporation and its earnings or financial results should be to "FPL Group" and not abbreviated using the name "FPL" as the latter is the name/acronym of the corporation's electric utility subsidiary.

 

FPL Group reports solid third-quarter earnings
  • FPL Energy delivers strong overall results despite adverse weather effects
  • Florida Power & Light posts lower income amid continued economic slowdown
  • FPL Group maintains strong balance sheet and excellent liquidity

JUNO BEACH, Fla. - FPL Group, Inc. (NYSE: FPL) today reported 2008 third-quarter net income on a GAAP basis of $774 million, or $1.92 per share, compared to $533 million, or $1.33 per share, in the third quarter of 2007. FPL Group's net income for the third quarter of 2008 includes a net unrealized after-tax gain of $285 million associated with the mark-to-market effect of non-qualifying hedges and a $17 million after-tax loss related to other than temporary impairments on investments (OTTI), both of which relate to FPL Energy. The results for last year's third quarter included a net unrealized after-tax gain of $40 million associated with the mark-to-market effect of non-qualifying hedges and a $1 million after-tax loss related to OTTI.

Excluding the mark-to-market effect of non-qualifying hedges and OTTI, FPL Group's adjusted earnings were $506 million, or $1.25 per share, for the third quarter of 2008, compared with $494 million, or $1.23 per share, for the third quarter of 2007.

FPL Group's management uses adjusted earnings internally for financial planning, for analysis of performance, for reporting of results to the Board of Directors and as inputs in determining whether certain performance targets are met for performance-based compensation under the company's employee incentive compensation plans. FPL Group also uses earnings expressed in this fashion when communicating its earnings outlook to analysts and investors. FPL Group management believes that adjusted earnings provide a more meaningful representation of FPL Group's fundamental earnings power.

"I am pleased to be able to report solid performance by FPL Group. Against some powerful economic undercurrents and adverse weather conditions, adjusted earnings per share increased year over year and we remain on track to achieve our previously issued earnings expectations for the year. Despite the turmoil in the credit markets, we have an exceptionally strong balance sheet, excellent credit ratings, continued and uninterrupted access to the commercial paper markets, and significant lines of credit available to us. In short, we believe we are well positioned to continue our strategic direction even with the challenges of the current market. In light of the current economic environment, we will be temporarily deferring a modest amount of our growth capital expenditures at both businesses, and we have plans in place for more deferrals if conditions deteriorate. Nonetheless, we remain optimistic about our long-term growth prospects. We will continue our emphasis on financial strength, financial discipline, operational excellence and strategic investments, and we remain committed to delivering value for customers and shareholders," said FPL Group Chairman and Chief Executive Officer Lew Hay.

Florida Power & Light Company
Florida Power & Light Company (FPL) reported third-quarter net income of $314 million, or $0.78 per share, compared to $326 million, or $0.81 per share, for the prior-year quarter, reflecting the impact of the economic downturn in the state. Retail sales of electricity decreased by 4.3 percent compared with the prior year, with weather-related electricity usage declining by 1.5 percent and underlying usage declining by 2.8 percent. Year-over-year average customer accounts were flat.

Due to the slowing economy's effects on new customers and usage, FPL has acted to reduce operations and maintenance (O&M) expenses and capital expenditures in areas that do not impact the company's ability to deliver safe, reliable electric service to its customers. FPL reduced its third-quarter O&M expenses by $22 million when compared to the prior year's quarter and is reducing capital expenditures for the full year 2008 by $475 million versus its original plans.

At the same time, the company is moving forward with projects that will deliver significant benefits to FPL's existing 4.5 million customers by increasing fuel efficiency and reducing emissions in the short term and enhancing fuel diversity over the longer term. In addition, these investments will ensure that FPL is well positioned to continue to provide affordable, safe and reliable energy when Florida's growth profile again accelerates.

In September, the Florida Public Service Commission (PSC) approved FPL's request to modernize its Cape Canaveral and Riviera Beach power plants, which will be 33 percent more fuel efficient, and to build a third natural gas unit at the West County Energy Center in Palm Beach County. Combined, the projects have a capacity of approximately 3,650 megawatts of clean, efficient generation. In October, the PSC approved FPL's request to recover costs for "uprates" to the company's four existing nuclear units at Turkey Point and St. Lucie as well as the ongoing development costs for two additional nuclear units at Turkey Point. The PSC also has approved cost recovery eligibility for 110 megawatts of solar generation. These projects will provide clean, efficient generation as well as fuel diversity.

FPL Energy

FPL Energy, the competitive energy subsidiary of FPL Group, reported third-quarter net income on a GAAP basis of $483 million or $1.20 per share, compared to $220 million, or $0.55 per share, in the prior-year quarter.

Excluding the mark-to-market effect of non-qualifying hedges and OTTI, adjusted earnings for FPL Energy were $215 million, or $0.53 per share, in the quarter, compared to $181 million, or $0.45 per share, in the same period in 2007.

FPL Energy's 18 percent growth in adjusted earnings per share in the third quarter was driven principally by the addition of new generation facilities, including new wind projects and the Point Beach nuclear facility acquired in September 2007, as well as contributions from its NEPOOL assets and ERCOT fossil assets. Weather had a significant impact during the quarter. Although hydro conditions in Maine were favorable, the wind resource for FPL Energy's facilities was the lowest in 35 years. On a net basis, these two factors reduced third-quarter earnings per share by $0.07 relative to plan.

FPL Energy's gross margins remain well hedged, providing insulation against commodity price fluctuations. Ninety percent of FPL Energy's 2009 expected gross margin for existing assets is protected against price movements. The equivalent figure for 2010 is 88 percent. This estimate does not include other factors such as power or fuel basis; weather, including wind, hydro and solar availability; and operational performance.

FPL Energy remains on track to add approximately 1,300 megawatts of new wind capacity in 2008, having placed 499 megawatts into service thus far. The production tax credit for wind was extended through 2009 as part of the Emergency Economic Stabilization Act of 2008.

FPL Group Liquidity

Despite the recent turmoil in the financial markets, FPL Group remains well positioned with a strong balance sheet and long-term focus on financial discipline. FPL Group has the second largest credit facility in the industry, at $6.75 billion, with only a small portion of the facility currently supporting outstanding letters of credit. During this period of financial turmoil in the credit markets, FPL Group has had continued, uninterrupted access to the commercial paper markets. In addition, the company has only $950 million of debt maturing in 2009, not including approximately $300 million of amortizing principal payments. FPL Group delivered approximately $2.4 billion of operating cash flow for the nine months ended Sept. 30, 2008. Moreover, FPL Group has among the highest long-term and short-term credit ratings in the industry, carrying an "A" rating from all three credit rating agencies.

Corporate and Other

Corporate and Other reduced net income by $23 million or $0.06 per share for the third quarter of 2008, primarily driven by interest expense, compared with $13 million or $0.03 for the prior-year quarter.

Outlook

In light of the current economic and credit environment, FPL Group will be reducing capital expenditures at both businesses for 2009. Original plans called for capital expenditures of approximately $7 billion in 2009, but the revised plan now calls for approximately $5.3 billion. Of the $1.7 billion reduction, approximately $1.3 billion involves the deferral of new project development at FPL Energy, including wind energy projects. FPL Energy had previously planned to add approximately 1,500 megawatts in 2009, but the revised plan is to build approximately 1,100 megawatts. In addition, FPL plans to reduce 2009 capital expenditures by approximately $400 million for projects associated with system growth that is no longer expected. Current planning allows the flexibility to quickly ramp plans up or down as credit and market conditions change. In addition, FPL Group's current approach also preserves the ability to make "buy vs. build" decisions should attractive market opportunities present themselves.

For 2008, FPL Group expects adjusted earnings per share to come in at the lower end of the $3.83 to $3.93 range that was previously provided, given normal weather and no further material decline in the Florida economy. For 2009 and 2010, FPL Group is reaffirming adjusted earnings per share of $4.05 to $4.25 and $4.50 to $4.90, respectively.

As always, FPL Group's adjusted earnings expectations assume normal weather and operating conditions and exclude the effect of adopting new accounting standards, if any, and the mark-to-market effect of non-qualifying hedges and OTTI, neither of which can be determined at this time.

 

As previously announced, FPL Group's third quarter earnings conference call is scheduled for 9 a.m. ET on Monday, Oct. 27, 2008. The webcast is available on FPL Group's website by accessing the following link, http://www.FPLGroup.com/investor/contents/investor_index.shtml. This earnings press release and the slides accompanying the presentation may be downloaded at www.FPLGroup.com beginning at 7:30 a.m. ET today. For persons unable to listen to the live webcast, a replay will be available for 30 days by accessing the same link as listed above.

This news release should be read in conjunction with the attached unaudited financial information.

Profile

FPL Group, with annual revenues of over $15 billion, is nationally known as a high quality, efficient, and customer-driven organization focused on energy-related products and services. With a growing presence in 27 states, it is widely recognized as one of the country's premier power companies. Its rate-regulated subsidiary, Florida Power & Light Company, serves 4.5 million customer accounts in Florida.  FPL Energy, LLC, an FPL Group competitive energy subsidiary, is a leader in producing electricity from clean and renewable fuels.  Additional information is available on the Internet at www.FPLGroup.com, www.FPL.com  and www.FPLEnergy.com

 

Cautionary Statements And Risk Factors That May Affect Future Results

In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 (Reform Act), FPL Group, Inc. (FPL Group) and Florida Power & Light Company (FPL) are hereby providing cautionary statements identifying important factors that could cause FPL Group's or FPL's actual results to differ materially from those projected in forward-looking statements (as such term is defined in the Reform Act) made by or on behalf of FPL Group and FPL in this news release, on their respective websites, in response to questions or otherwise. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions, future events or performance, climate change strategy or growth strategies (often, but not always, through the use of words or phrases such as will likely result, are expected to, will continue, is anticipated, aim, believe, could, estimated, may, plan, potential, projection, target, outlook, predict, intend) are not statements of historical facts and may be forward-looking. Forward-looking statements involve estimates, assumptions and uncertainties. Accordingly, any such statements are qualified in their entirety by reference to, and are accompanied by, the following important factors (in addition to any assumptions and other factors referred to specifically in connection with such forward-looking statements) that could cause FPL Group's or FPL's actual results to differ materially from those contained in forward-looking statements made by or on behalf of FPL Group and FPL.

Any forward-looking statement speaks only as of the date on which such statement is made, and FPL Group and FPL undertake no obligation to update any forward-looking statement to reflect events or circumstances, including unanticipated events, after the date on which such statement is made. New factors emerge from time to time and it is not possible for management to predict all of such factors, nor can it assess the impact of each such factor on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statement.

The following are some important factors that could have a significant impact on FPL Group's and FPL's operations and financial results, and could cause FPL Group's and FPL's actual results or outcomes to differ materially from those discussed in the forward-looking statements:

FPL Group and FPL are subject to complex laws and regulations and to changes in laws and regulations as well as changing governmental policies and regulatory actions, including, but not limited to, initiatives regarding deregulation and restructuring of the energy industry and environmental matters, including, but not limited to, matters related to the effects of climate change.  FPL holds franchise agreements with local municipalities and counties, and must renegotiate expiring agreements.  These factors may have a negative impact on the business and results of operations of FPL Group and FPL.

  • FPL Group and FPL are subject to complex laws and regulations, and to changes in laws or regulations, including, but not limited to, the PURPA, the Holding Company Act, the Federal Power Act, the Atomic Energy Act of 1954, as amended, the 2005 Energy Act and certain sections of the Florida statutes relating to public utilities, changing governmental policies and regulatory actions, including, but not limited to, those of the FERC, the FPSC and the legislatures and utility commissions of other states in which FPL Group has operations, and the NRC, with respect to, among other things, allowed rates of return, industry and rate structure, operation of nuclear power facilities, construction and operation of plant facilities, construction and operation of transmission and distribution facilities, acquisition, disposal, depreciation and amortization of assets and facilities, recovery of fuel and purchased power costs, decommissioning costs, ROE and equity ratio limits, and present or prospective wholesale and retail competition (including, but not limited to, retail wheeling and transmission costs).  The FPSC has the authority to disallow recovery by FPL of any and all costs that it considers excessive or imprudently incurred.  The regulatory process generally restricts FPL's ability to grow earnings and does not provide any assurance as to achievement of earnings levels.

  • FPL Group and FPL are subject to extensive federal, state and local environmental statutes, rules and regulations, as well as the effect of changes in or additions to applicable statutes, rules and regulations relating to air quality, water quality, climate change, waste management, marine and wildlife mortality, natural resources and health and safety that could, among other things, restrict or limit the output of certain facilities or the use of certain fuels required for the production of electricity and/or require additional pollution control equipment and otherwise increase costs.  There are significant capital, operating and other costs associated with compliance with these environmental statutes, rules and regulations, and those costs could be even more significant in the future.

  • FPL Group and FPL operate in a changing market environment influenced by various legislative and regulatory initiatives regarding deregulation, regulation or restructuring of the energy industry, including, but not limited to, deregulation or restructuring of the production and sale of electricity, as well as increased focus on renewable energy sources.  FPL Group and its subsidiaries will need to adapt to these changes and may face increasing competitive pressure.

  • FPL Group's and FPL's results of operations could be affected by FPL's ability to renegotiate franchise agreements with municipalities and counties in Florida.

The operation and maintenance of transmission, distribution and power generation facilities, including nuclear facilities, involve significant risks that could adversely affect the results of operations and financial condition of FPL Group and FPL.

  • The operation and maintenance of transmission, distribution and power generation facilities involve many risks, including, but not limited to, start up risks, breakdown or failure of equipment, transmission and distribution lines or pipelines, the inability to properly manage or mitigate known equipment defects throughout FPL Group's and FPL's generation fleets and transmission and distribution systems unless and until such defects are remediated, use of new technology, the dependence on a specific fuel source, including the supply and transportation of fuel, or the impact of unusual or adverse weather conditions (including, but not limited to, natural disasters such as hurricanes and droughts), as well as the risk of performance below expected or contracted levels of output or efficiency.  This could result in lost revenues and/or increased expenses, including, but not limited to, the requirement to purchase power in the market at potentially higher prices to meet contractual obligations.  Insurance, warranties or performance guarantees may not cover any or all of the lost revenues or increased expenses, including, but not limited to, the cost of replacement power.  In addition to these risks, FPL Group's and FPL's nuclear units face certain risks that are unique to the nuclear industry including, but not limited to, the ability to store and/or dispose of spent nuclear fuel and the potential payment of significant retrospective insurance premiums, as well as additional regulatory actions up to and including shutdown of the units stemming from public safety concerns, whether at FPL Group's and FPL's plants, or at the plants of other nuclear operators.  Breakdown or failure of an operating facility of FPL Energy may prevent the facility from performing under applicable power sales agreements which, in certain situations, could result in termination of the agreement or incurring a liability for liquidated damages.

The construction of, and capital improvements to, power generation facilities, including nuclear facilities, involve substantial risks.  Should construction or capital improvement efforts be unsuccessful, the results of operations and financial condition of FPL Group and FPL could be adversely affected.

 

  • FPL Group's and FPL's ability to successfully and timely complete their power generation facilities currently under construction, those projects yet to begin construction or capital improvements to existing facilities within established budgets is contingent upon many variables, including, but not limited to, transmission interconnection issues and escalating costs for materials, labor and environmental compliance, and subject to substantial risks.  Should any such efforts be unsuccessful, FPL Group and FPL could be subject to additional costs, termination payments under committed contracts, and/or the write-off of their investment in the project or improvement.

The use of derivative contracts by FPL Group and FPL in the normal course of business could result in financial losses that negatively impact the results of operations of FPL Group and FPL.

  • FPL Group and FPL use derivative instruments, such as swaps, options and forwards to manage their commodity and financial market risks.  FPL Group provides full energy and capacity requirements services primarily to distribution utilities and engages in energy trading activities.  FPL Group could recognize financial losses as a result of volatility in the market values of these derivative instruments, or if a counterparty fails to perform.  In the absence of actively quoted market prices and pricing information from external sources, the valuation of these derivative instruments involves management's judgment or use of estimates.  As a result, changes in the underlying assumptions or use of alternative valuation methods could affect the reported fair value of these derivative instruments.  In addition, FPL's use of such instruments could be subject to prudency challenges and if found imprudent, cost recovery could be disallowed by the FPSC.

FPL Group's competitive energy business is subject to risks, many of which are beyond the control of FPL Group, including, but not limited to, the ability to efficiently develop and operate generating assets, the successful and timely completion of project restructuring activities, the price and supply of fuel, transmission constraints, competition from new sources of generation, excess generation capacity and demand for power, that may reduce the revenues and adversely impact the results of operations and financial condition of FPL Group.

 

  • There are other risks associated with FPL Group's competitive energy business.  In addition to risks discussed elsewhere, risk factors specifically affecting FPL Energy's success in competitive wholesale markets include, but are not limited to, the ability to efficiently develop and operate generating assets, the successful and timely completion of project restructuring activities, maintenance of the qualifying facility status of certain projects, the price and supply of fuel (including transportation), transmission constraints, competition from new sources of generation, excess generation capacity and demand for power.  There can be significant volatility in market prices for fuel and electricity, and there are other financial, counterparty and market risks that are beyond the control of FPL Energy.  FPL Energy's inability or failure to effectively hedge its assets or positions against changes in commodity prices, interest rates, counterparty credit risk or other risk measures could significantly impair FPL Group's future financial results.  In keeping with industry trends, a portion of FPL Energy's power generation facilities operate wholly or partially without long-term power purchase agreements.  As a result, power from these facilities is sold on the spot market or on a short-term contractual basis, which may affect the volatility of FPL Group's financial results.  In addition, FPL Energy's business depends upon transmission facilities owned and operated by others; if transmission is disrupted or capacity is inadequate or unavailable, FPL Energy's ability to sell and deliver its wholesale power may be limited.

FPL Group's ability to successfully identify, complete and integrate acquisitions is subject to significant risks, including, but not limited to, the effect of increased competition for acquisitions resulting from the consolidation of the power industry.

  • FPL Group is likely to encounter significant competition for acquisition opportunities that may become available as a result of the consolidation of the power industry, in general, as well as the passage of the 2005 Energy Act.  In addition, FPL Group may be unable to identify attractive acquisition opportunities at favorable prices and to complete and integrate them successfully and in a timely manner.

Because FPL Group and FPL rely on access to capital markets, the inability to maintain current credit ratings and to access capital markets on favorable terms may limit the ability of FPL Group and FPL to grow their businesses and would likely increase interest costs.

  • FPL Group and FPL rely on access to capital markets as a significant source of liquidity for capital requirements not satisfied by operating cash flows.  The inability of FPL Group, FPL Group Capital and FPL to maintain their current credit ratings, as well as significant volatility in the financial markets, could affect their ability to raise capital on favorable terms, which, in turn, could impact FPL Group's and FPL's ability to grow their businesses and would likely increase their interest costs.

Customer growth in FPL's service area affects FPL Group's and FPL's results of operations.

  • FPL Group's and FPL's results of operations are affected by the growth in customer accounts in FPL's service area.  Customer growth can be affected by population growth as well as economic factors in Florida, including, but not limited, to job and income growth, housing starts and new home prices.  Customer growth directly influences the demand for electricity and the need for additional power generation and power delivery facilities at FPL.

 

Weather affects FPL Group's and FPL's results of operations, as can the impact of severe weather.  Weather conditions directly influence the demand for electricity and natural gas, affect the price of energy commodities, and can affect the production of electricity at power generating facilities.

  • FPL Group's and FPL's results of operations are affected by changes in the weather.  Weather conditions directly influence the demand for electricity and natural gas, affect the price of energy commodities, and can affect the production of electricity at power generating facilities, including, but not limited to, wind, solar and hydro-powered facilities.  FPL Group's and FPL's results of operations can be affected by the impact of severe weather which can be destructive, causing outages and/or property damage, may affect fuel supply, and could require additional costs to be incurred.  At FPL, recovery of these costs is subject to FPSC approval.

FPL Group and FPL are subject to costs and other potentially adverse effects of legal and regulatory proceedings, as well as regulatory compliance and changes in or additions to applicable tax laws, rates or policies, rates of inflation, accounting standards, securities laws and corporate governance requirements.

  • FPL Group and FPL are subject to costs and other effects of legal and administrative proceedings, settlements, investigations and claims, as well as the effect of new, or changes in, tax laws, rates or policies, rates of inflation, accounting standards, securities laws and corporate governance requirements.

Threats of terrorism and catastrophic events that could result from terrorism, cyber attacks, or individuals and/or groups attempting to disrupt FPL Group's and FPL's business may impact the operations of FPL Group and FPL in unpredictable ways.

  • FPL Group and FPL are subject to direct and indirect effects of terrorist threats and activities, as well as cyber attacks and disruptive activities of individuals and/or groups.  Infrastructure facilities and systems, including, but not limited to, generation, transmission and distribution facilities, physical assets and information systems, in general, have been identified as potential targets.  The effects of these threats and activities include, but are not limited to, the inability to generate, purchase or transmit power, the delay in development and construction of new generating facilities, the risk of a significant slowdown in growth or a decline in the U.S. economy, delay in economic recovery in the U.S., and the increased cost and adequacy of security and insurance.

The ability of FPL Group and FPL to obtain insurance and the terms of any available insurance coverage could be adversely affected by national, state or local events and company-specific events.

  • FPL Group's and FPL's ability to obtain insurance, and the cost of and coverage provided by such insurance, could be affected by national, state or local events as well as company-specific events.

FPL Group and FPL are subject to employee workforce factors that could adversely affect the businesses and financial condition of FPL Group and FPL.

  • FPL Group and FPL are subject to employee workforce factors, including, but not limited to, loss or retirement of key executives, availability of qualified personnel, inflationary pressures on payroll and benefits costs, collective bargaining agreements with union employees and work stoppage that could affect the businesses and financial condition of FPL Group and FPL.


The risks described herein are not the only risks facing FPL Group and FPL.  Additional risks and uncertainties not currently known to FPL Group or FPL, or that are currently deemed to be immaterial, also may materially adversely affect FPL Group's or FPL's business, financial condition and/or future operating results.

 

 

 

FPL Group, Inc.
Condensed Consolidated Statements of Income
(millions, except per share amounts)
(unaudited)

Three Months Ended September 30, 2008

  

Florida Power
& Light

FPL
Energy

  

Corporate &
Other

FPL Group,
Inc.

Operating Revenues

  

$ 3,423

 

$ 1,916

 

$ 48

 

$ 5,387

                     

Operating Expenses

                
 

Fuel, purchased power and interchange

  

1,992

 

711

 

25

 

2,728

 

Other operations and maintenance

  

356

 

259

 

18

 

633

 

Storm cost amortization

  

20

 

-

 

-

 

20

 

Depreciation and amortization

  

200

 

144

 

4

 

348

 

Taxes other than income taxes

  

306

 

36

 

-

 

342

   

Total operating expenses

  

2,874

 

1,150

 

47

 

4,071

                     

Operating Income (Loss)

  

549

 

766

 

1

 

1,316

Other Income (Deductions)

                
 

Interest expense

  

(83)

  

(81)

  

(39)

  

(203)
 

Equity in earnings of equity method investees

  

-

 

46

 

-

 

46

 

Allowance for equity funds used during construction

  

9

 

-

 

-

 

9

 

Interest income

  

2

 

9

 

2

 

13

 

Other - net

  

(2)

  

(40)

  

(4)

  

(46)

   

Total other income (deductions) - net

  

(74)

  

(66)

  

(41)

  

(181)

                     

Income (Loss) Before Income Taxes

  

475

 

700

 

(40)

  

1,135

Income Tax Expense (Benefit)

  

161

 

217

 

(17)

  

361

Net Income (Loss)

  

$ 314

 

$ 483

 

$ (23)

  

$ 774

                     

Reconciliation of Net Income (Loss) to Adjusted Earnings (Loss):

                

Net Income (Loss)

  

$ 314

 

$ 483

 

$ (23)

  

$ 774

Adjustments, net of income taxes:

                
 

Net unrealized mark-to-market (gains) losses associated

                

 

with non-qualifying hedges

  

-

 

(285)

  

-

 

(285)
 

Other than temporary impairment losses - net

  

-

 

17

 

-

 

17

Adjusted Earnings (Loss)

  

$ 314

 

$ 215

 

$ (23)

  

$ 506

                     

Earnings (Loss) Per Share (assuming dilution)

  

$ 0.78

 

$ 1.20

 

$ (0.06)

  

$ 1.92

Adjustments:

                
 

Net unrealized mark-to-market (gains) losses associated

                

 

with non-qualifying hedges

  

-

 

(0.71)

  

-

 

(0.71)
 

Other than temporary impairment losses - net

  

-

 

0.04

 

-

 

0.04

Adjusted Earnings (Loss) Per Share

  

$ 0.78

 

$ 0.53

 

$ (0.06)

  

$ 1.25

Weighted-average shares outstanding (assuming dilution)

              

403

                     
                     

FPL Energy's interest expense is based on a deemed capital structure of 50% debt for operating projects and 100% debt for projects under construction. For these purposes, the deferred credit associated with differential membership interests sold by an FPL Energy subsidiary in December 2007 is included with debt. Residual non-utility interest expense is included in Corporate & Other. Corporate & Other represents other business activities, other segments that are not separately reportable, eliminating entries, and may include the net effect of rounding.

 

 

FPL Group, Inc.
Condensed Consolidated Statements of Income
(millions, except per share amounts)
(unaudited)

Three Months Ended September 30, 2007

  

Florida Power
& Light

FPL
Energy

  

Corporate &
Other

FPL Group,
Inc.

Operating Revenues

  

$ 3,445

 

$ 1,090

 

$ 40

 

$ 4,575

                     

Operating Expenses

                
 

Fuel, purchased power and interchange

  

1,969

 

457

 

17

 

2,443

 

Other operations and maintenance

  

378

 

187

 

17

 

582

 

Storm cost amortization

  

19

 

-

 

-

 

19

 

Depreciation and amortization

  

194

 

112

 

4

 

310

 

Taxes other than income taxes

  

294

 

25

 

2

 

321

   

Total operating expenses

  

2,854

 

781

 

40

 

3,675

Operating Income (Loss)

  

591

 

309

 

-

 

900

Other Income (Deductions)

                
 

Interest expense

  

(83)

  

(76)

  

(35)

  

(194)
 

Equity in earnings of equity method investees

  

-

 

36

 

-

 

36

 

Allowance for equity funds used during construction

  

4

 

-

 

-

 

4

 

Interest income

  

1

 

10

 

5

 

16

 

Other - net

  

(2)

  

(1)

  

1

 

(2)

   

Total other income (deductions) - net

  

(80)

  

(31)

  

(29)

  

(140)

Income (Loss) Before Income Taxes

  

511

 

278

 

(29)

  

760

Income Tax Expense (Benefit)

  

185

 

58

 

(16)

  

227

Net Income (Loss)

  

$ 326

 

$ 220

 

$ (13)

  

$ 533

                     

Reconciliation of Net Income (Loss) to Adjusted Earnings (Loss):

                

Net Income (Loss)

  

$ 326

 

$ 220

 

$ (13)

  

$ 533

Adjustments, net of income taxes:

                
 

Net unrealized mark-to-market (gains) losses associated

                
   

with non-qualifying hedges

  

-

 

(40)

  

-

 

(40)
 

Other than temporary impairment losses - net

  

-

 

1

 

-

 

1

Adjusted Earnings (Loss)

  

$ 326

 

$ 181

 

$ (13)

  

$ 494

                     

Earnings (Loss) Per Share (assuming dilution)

  

$ 0.81

 

$ 0.55

 

$ (0.03)

  

$ 1.33

Adjustments:

                
 

Net unrealized mark-to-market (gains) losses associated

                

 

with non-qualifying hedges

  

-

 

(0.10)

  

-

 

(0.10)
 

Other than temporary impairment losses - net

  

-

 

-

 

-

 

-

Adjusted Earnings (Loss) Per Share

  

$ 0.81

 

$ 0.45

 

$ (0.03)

  

$ 1.23

Weighted-average shares outstanding (assuming dilution)

              

401

                     
                     

FPL Energy's interest expense is based on a deemed capital structure of 50% debt for operating projects and 100% debt for projects under construction. For these purposes, the deferred credit associated with differential membership interests sold by an FPL Energy subsidiary in December 2007 is included with debt. Residual non-utility interest expense is included in Corporate & Other. Corporate & Other represents other business activities, other segments that are not separately reportable, eliminating entries, and may include the net effect of rounding.

 

 

FPL Group, Inc.
Condensed Consolidated Statements of Income
(millions, except per share amounts)
(unaudited)

Nine Months Ended September 30, 2008

  

Florida Power
& Light

FPL
Energy

  

Corporate &
Other

FPL Group,
Inc.

Operating Revenues

  

$ 8,829

 

$ 3,432

 

$ 146

 

$ 12,407

                     

Operating Expenses

                
 

Fuel, purchased power and interchange

  

5,047

 

1,296

 

75

 

6,418

 

Other operations and maintenance

  

1,114

 

759

 

53

 

1,926

 

Storm cost amortization

  

46

 

-

 

-

 

46

 

Depreciation and amortization

  

596

 

417

 

12

 

1,025

 

Taxes other than income taxes

  

817

 

100

 

2

 

919

   

Total operating expenses

  

7,620

 

2,572

 

142

 

10,334

                     

Operating Income (Loss)

  

1,209

 

860

 

4

 

2,073

Other Income (Deductions)

                
 

Interest expense

  

(252)

  

(228)

  

(117)

  

(597)
 

Equity in earnings of equity method investees

  

-

 

85

 

-

 

85

 

Allowance for equity funds used during construction

  

22

 

-

 

-

 

22

 

Interest income

  

10

 

28

 

11

 

49

 

Other - net

  

(9)

  

(45)

  

(4)

  

(58)

   

Total other income (deductions) - net

  

(229)

  

(160)

  

(110)

  

(499)
                     
                     

Income (Loss) Before Income Taxes

  

980

 

700

 

(106)

  

1,574

Income Tax Expense (Benefit)

  

342

 

50

 

(50)

  

342

Net Income (Loss)

  

$ 638

 

$ 650

 

$ (56)

  

$ 1,232

                     

Reconciliation of Net Income (Loss) to Adjusted Earnings (Loss):

                

Net Income (Loss)

  

$ 638

 

$ 650

 

$ (56)

  

$ 1,232

Adjustments, net of income taxes:

                
 

Net unrealized mark-to-market (gains) losses associated

                
   

with non-qualifying hedges

  

-

 

(76)

  

-

 

(76)
 

Other than temporary impairment losses - net

  

-

 

29

 

-

 

29

Adjusted Earnings (Loss)

  

$ 638

 

$ 603

 

$ (56)

  

$ 1,185

Earnings (Loss) Per Share (assuming dilution)

  

$ 1.59

 

$ 1.62

 

$ (0.15)

  

$ 3.06

Adjustments:

                
 

Net unrealized mark-to-market (gains) losses associated

                

 

with non-qualifying hedges

  

-

 

(0.19)

  

-

 

(0.19)
 

Other than temporary impairment losses - net

  

-

 

0.07

 

-

 

0.07

Adjusted Earnings (Loss) Per Share

  

$ 1.59

 

$ 1.50

 

$ (0.15)

  

$ 2.94

Weighted-average shares outstanding (assuming dilution)

              

403

                     
                     

FPL Energy's interest expense is based on a deemed capital structure of 50% debt for operating projects and 100% debt for projects under construction. For these purposes, the deferred credit associated with differential membership interests sold by an FPL Energy subsidiary in December 2007 is included with debt. Residual non-utility interest expense is included in Corporate & Other. Corporate & Other represents other business activities, other segments that are not separately reportable, eliminating entries, and may include the net effect of rounding.

 

 

FPL Group, Inc.
Condensed Consolidated Statements of Income
(millions, except per share amounts)
(unaudited)

Nine Months Ended September 30, 2007

  

Florida Power
& Light

FPL
Energy

  

Corporate &
Other

FPL Group,
Inc.

Operating Revenues

  

$ 8,798

 

$ 2,658

 

$ 123

 

$ 11,579

                     

Operating Expenses

                
 

Fuel, purchased power and interchange

  

5,081

 

1,084

 

56

 

6,221

 

Other operations and maintenance

  

1,074

 

537

 

48

 

1,659

 

Storm cost amortization

  

60

 

-

 

-

 

60

 

Depreciation and amortization

  

576

 

326

 

12

 

914

 

Taxes other than income taxes

  

786

 

75

 

2

 

863

   

Total operating expenses

  

7,577

 

2,022

 

118

 

9,717

                     

Operating Income (Loss)

  

1,221

 

636

 

5

 

1,862

Other Income (Deductions)

                
 

Interest expense

  

(224)

  

(221)

  

(107)

  

(552)
 

Equity in earnings of equity method investees

  

-

 

67

 

-

 

67

 

Allowance for equity funds used during construction

  

17

 

-

 

-

 

17

 

Interest income

  

14

 

27

 

20

 

61

 

Other - net

  

(7)

  

(3)

  

3

 

(7)

   

Total other income (deductions) - net

  

(200)

  

(130)

  

(84)

  

(414)

                     

Income (Loss) Before Income Taxes

  

1,021

 

506

 

(79)

  

1,448

Income Tax Expense (Benefit)

  

358

 

38

 

(36)

  

360

Net Income (Loss)

$ 663

$ 468

$ (43)

$ 1,088

                     

Reconciliation of Net Income (Loss) to Adjusted Earnings (Loss):

            

Net Income (Loss)

  

$ 663

 

$ 468

 

$ (43)

  

$ 1,088

Adjustments, net of income taxes:

                
 

Net unrealized mark-to-market (gains) losses associated

                
   

with non-qualifying hedges

  

-

 

28

 

-

 

28

 

Other than temporary impairment losses - net

  

-

 

3

 

-

 

3

Adjusted Earnings (Loss)

  

$ 663

 

$ 499

 

$ (43)

  

$ 1,119

Earnings (Loss) Per Share (assuming dilution)

  

$ 1.66

 

$ 1.17

 

$ (0.11)

  

$ 2.72

Adjustments:

                
 

Net unrealized mark-to-market (gains) losses associated

                

 

with non-qualifying hedges

  

-

 

0.07

 

-

 

0.07

 

Other than temporary impairment losses - net

  

-

 

0.01

 

-

 

0.01

Adjusted Earnings (Loss) Per Share

  

$ 1.66

 

$ 1.25

 

$ (0.11)

  

$ 2.80

Weighted-average shares outstanding (assuming dilution)

              

400

                     
                     

FPL Energy's interest expense is based on a deemed capital structure of 50% debt for operating projects and 100% debt for projects under construction. For these purposes, the deferred credit associated with differential membership interests sold by an FPL Energy subsidiary in December 2007 is included with debt. Residual non-utility interest expense is included in Corporate & Other. Corporate & Other represents other business activities, other segments that are not separately reportable, eliminating entries, and may include the net effect of rounding.

 

 

FPL Group, Inc.
Condensed Consolidated Balance Sheets
(millions)
(unaudited)

    
                   

September 30, 2008

Florida Power
& Light

FPL
Energy

Corporate &
Other

FPL Group,
Inc.

Property, Plant and Equipment

                

Electric utility plant in service and other property

$ 26,277

 

$ 13,432

 

$ 265

 

$ 39,974

Nuclear fuel

  

603

 

608

 

-

 

1,211

Construction work in progress

  

1,454

 

1,594

 

13

 

3,061

Less accumulated depreciation and amortization

(10,136)

  

(2,612)

  

(153)

  

(12,901)

 

Total property, plant and equipment - net

18,198

 

13,022

 

125

 

31,345

                   
                   

Current Assets

                

Cash and cash equivalents

  

881

 

112

 

599

 

1,592

Customer receivables, net of allowances

  

1,064

 

647

 

16

 

1,727

Other receivables, net of allowances

  

138

 

210

 

(7)

  

341

Materials, supplies and fossil fuel inventory - at avg. cost

625

 

388

 

6

 

1,019

Regulatory assets:

                

Deferred clause and franchise expenses

  

573

 

-

 

-

 

573

Securitized storm-recovery costs

  

63

 

-

 

-

 

63

Derivatives

  

436

 

-

 

-

 

436

Other

  

-

 

-

 

3

 

3

Derivatives

  

3

 

249

 

(1)

  

251

Other

  

134

 

112

 

57

 

303

 

Total current assets

  

3,917

 

1,718

 

673

 

6,308

                   

Other Assets

                

Special use funds

  

2,313

 

881

 

1

 

3,195

Prepaid benefit costs

  

971

 

-

 

1,026

 

1,997

Other investments

  

6

 

321

 

173

 

500

Regulatory assets:

                

Securitized storm-recovery costs

  

727

 

-

 

-

 

727

Deferred clause expenses

  

111

 

-

 

-

 

111

Unamortized loss on reacquired debt

  

33

 

-

 

-

 

33

Other

  

183

 

-

 

20

 

203

Other

  

280

 

538

 

241

 

1,059

 

Total other assets

  

4,624

 

1,740

 

1,461

 

7,825

                   

Total Assets

  

$ 26,739

 

$ 16,480

 

$ 2,259

 

$ 45,478

                   

Capitalization

                

Common stock

  

$ 1,373

 

$ -

 

$ (1,369)

  

$ 4

Additional paid-in capital

  

4,394

 

5,997

 

(5,620)

  

4,771

Retained earnings

  

2,172

 

2,442

 

2,042

 

6,656

Accumulated other comprehensive income (loss)

-

 

(35)

  

138

 

103

 

Total common shareholders' equity

  

7,939

 

8,404

 

(4,809)

  

11,534

Long-term debt

  

5,310

 

3,371

 

4,133

 

12,814

 

Total capitalization

  

13,249

 

11,775

 

(676)

  

24,348

                   

Current Liabilities

                

Commercial paper

  

1,500

 

-

 

1,315

 

2,815

Notes payable

  

50

 

-

 

175

 

225

Current maturities of long-term debt

  

263

 

291

 

626

 

1,180

Accounts payable

  

911

 

513

 

(1)

  

1,423

Customer deposits

  

559

 

6

 

-

 

565

Accrued interest and taxes

  

510

 

122

 

(53)

  

579

Regulatory liabilities:

                
 

Deferred clause and franchise revenues

13

 

-

 

-

 

13

 

Derivatives

  

-

 

-

 

-

 

-

 

Pension

  

-

 

-

 

24

 

24

Derivatives

  

434

 

125

 

-

 

559

Other

  

597

 

527

 

(6)

  

1,118

 

Total current liabilities

  

4,837

 

1,584

 

2,080

 

8,501

                   

Other Liabilities and Deferred Credits

                

Asset retirement obligations

  

1,720

 

532

 

-

 

2,252

Accumulated deferred income taxes

  

2,954

 

1,100

 

161

 

4,215

Regulatory liabilities:

                

Accrued asset removal costs

  

2,129

 

-

 

-

 

2,129

Asset retirement obligation regulatory expense difference

675

 

-

 

-

 

675

Pension

  

-

 

-

 

672

 

672

Other

  

232

 

-

 

1

 

233

Derivatives

  

93

 

281

 

-

 

374

Other

 

850

 

1,208

 

21

 

2,079

Total other liabilities and deferred credits

  

8,653

 

3,121

 

855

 

12,629

                   

Commitments and Contingencies

                
                   

Total Capitalization and Liabilities

  

$ 26,739

 

$ 16,480

 

$ 2,259

 

$ 45,478

                   

Corporate & Other represents other business activities, other segments that are not separately reportable, eliminating entries, and may include the net effect of rounding.

 

 

FPL Group, Inc.
Condensed Consolidated Balance Sheets
(millions)
(unaudited)

    
                   

December 31, 2007

  

Florida Power
& Light

FPL
Energy

  

Corporate &
Other

FPL Group,
Inc.

Property, Plant and Equipment

                

Electric utility plant in service and other property

$ 25,585

 

$ 12,398

 

$ 248

 

$ 38,231

Nuclear fuel

  

565

 

531

 

-

 

1,096

Construction work in progress

  

1,101

 

605

 

7

 

1,713

Less accumulated depreciation and amortization

(10,081)

  

(2,167)

  

(140)

  

(12,388)

 

Total property, plant and equipment - net

17,170

 

11,367

 

115

 

28,652

                   
                   

Current Assets

                

Cash and cash equivalents

  

63

 

157

 

70

 

290

Customer receivables, net of allowances

807

 

673

 

16

 

1,496

Other receivables, net of allowances

  

178

 

99

 

(52)

  

225

Materials, supplies and fossil fuel inventory - at avg. cost

583

 

268

 

6

 

857

Regulatory assets:

                

Deferred clause and franchise expenses

103

 

-

 

-

 

103

Securitized storm-recovery costs

  

59

 

-

 

-

 

59

Derivatives

  

117

 

-

 

-

 

117

Other

  

-

 

-

 

2

 

2

Derivatives

  

83

 

99

 

-

 

182

Other

  

260

 

150

 

38

 

448

Total current assets

2,253

1,446

80

3,779

Other Assets

Special use funds

2,499

982

1

3,482

Prepaid benefit costs

907

-

1,004

1,911

Other investments

7

227

157

391

Regulatory assets:

Securitized storm-recovery costs

756

-

-

756

Deferred clause expenses

121

-

-

121

Unamortized loss on reacquired debt

36

-

-

36

Other

72

-

23

95

Other

223

483

194

900

Total other assets

4,621

1,692

1,379

7,692

Total Assets

$ 24,044

$ 14,505

$ 1,574

$ 40,123

Capitalization

Common stock

$ 1,373

$ -

$ (1,369)

$ 4

Additional paid-in capital

4,318

5,139

(4,787)

4,670

Retained earnings

1,584

1,792

2,569

5,945

Accumulated other comprehensive income (loss)

-

(28)

144

116

Total common shareholders' equity

7,275

6,903

(3,443)

10,735

Long-term debt

4,976

2,873

3,431

11,280

Total capitalization

12,251

9,776

(12)

22,015

                   

Current Liabilities

                

Commercial paper

  

842

 

-

 

175

 

1,017

Current maturities of long-term debt

  

241

 

654

 

506

 

1,401

Accounts payable

  

706

 

493

 

5

 

1,204

Customer deposits

  

531

 

7

 

1

 

539

Accrued interest and taxes

  

225

 

128

 

(2)

  

351

Regulatory liabilities:

                
 

Deferred clause and franchise revenues

18

 

-

 

-

 

18

 

Derivatives

  

-

 

-

 

-

 

-

 

Pension

  

-

 

-

 

24

 

24

Derivatives

  

182

 

107

 

-

 

289

Other

531

380

4

915

Total current liabilities

3,276

1,769

713

5,758

Other Liabilities and Deferred Credits

Asset retirement obligations

1,653

504

-

2,157

Accumulated deferred income taxes

2,716

935

170

3,821

Regulatory liabilities:

Accrued asset removal costs

2,098

-

-

2,098

Asset retirement obligation regulatory expense difference

921

-

-

921

Pension

-

-

696

696

Other

235

-

1

236

Derivatives

5

346

-

351

Other

889

1,175

6

2,070

Total other liabilities and deferred credits

8,517

2,960

873

12,350

                   

Commitments and Contingencies

                
                   

Total Capitalization and Liabilities

  

$ 24,044

 

$ 14,505

 

$ 1,574

 

$ 40,123

                   

Corporate & Other represents other business activities, other segments that are not separately reportable, eliminating entries, and may include the net effect of rounding.

 

 

 

FPL Group, Inc.
Condensed Consolidated Statements of Cash Flows
(millions)
(unaudited)

Nine Months Ended September 30, 2008

Florida Power
& Light

FPL
Energy

Corporate &
Other

FPL Group,
Inc.

Cash Flows From Operating Activities

                

Net income (loss)

  

$ 638

 

$ 650

 

$ (56)

  

$ 1,232

Adjustments to reconcile net income (loss) to net

                

    cash provided by (used in) operating activities:

                

Depreciation and amortization

  

596

 

417

 

12

 

1,025

Nuclear fuel amortization

  

78

 

68

 

-

 

146

Recoverable storm-related costs of FPL

  

47

 

-

 

-

 

47

Storm cost amortization

  

46

 

-

 

-

 

46

Unrealized (gains) losses on marked to market energy contracts

-

 

(171)

  

1

 

(170)

Deferred income taxes

  

317

 

187

 

4

 

508

Cost recovery clauses and franchise fees

  

(465)

  

-

 

-

 

(465)

Change in prepaid option premiums and derivative settlements

-

 

(7)

  

1

 

(6)

Equity in earnings of equity method investees

  

-

 

(85)

  

-

 

(85)

Distributions of earnings from equity method investees

  

-

 

50

 

-

 

50

Changes in operating assets and liabilities:

                
 

Customer receivables

  

(257)

  

27

 

(5)

  

(235)
 

Other receivables

  

(6)

  

19

 

(19)

  

(6)
 

Materials, supplies and fossil fuel inventory

  

(42)

  

(115)

  

1

 

(156)
 

Other current assets

  

(46)

  

(3)

  

2

 

(47)
 

Other assets

  

(66)

  

(18)

  

(24)

  

(108)
 

Accounts payable

  

228

 

13

 

(7)

  

234

 

Customer deposits

  

28

 

(2)

  

1

 

27

 

Margin cash collateral

  

18

 

10

 

-

 

28

 

Income taxes

  

88

 

(157)

  

(104)

  

(173)
 

Interest and other taxes

  

221

 

14

 

7

 

242

 

Other current liabilities

  

81

 

(8)

  

-

 

73

 

Other liabilities

  

14

 

(34)

  

5

 

(15)

Other - net

  

23

 

79

 

65

 

167

Net cash provided by (used in) operating activities

  

1,541

 

934

 

(116)

  

2,359

                   

Cash Flows From Investing Activities

                

Capital expenditures of FPL

  

(1,665)

  

-

 

-

 

(1,665)

Independent power investments

  

-

 

(1,854)

  

-

 

(1,854)

Nuclear fuel purchases

  

(88)

  

(76)

  

-

 

(164)

Other capital expenditures

  

-

 

-

 

(32)

  

(32)

Proceeds from sale of securities in special use funds

  

1,102

 

616

 

-

 

1,718

Purchases of securities in special use funds

  

(1,168)

  

(630)

  

1

 

(1,797)

Proceeds from sale of other securities

  

-

 

-

 

84

 

84

Purchases of other securities

  

-

 

(37)

  

(151)

  

(188)

Other - net

  

1

 

40

 

-

 

41

Net cash provided by (used in) investing activities

  

(1,818)

  

(1,941)

  

(98)

  

(3,857)

                   

Cash Flows From Financing Activities

                

Issuances of long-term debt

  

589

 

681

 

1,317

 

2,587

Retirements of long-term debt

  

(241)

  

(577)

  

(506)

  

(1,324)

Net change in short-term debt

  

708

 

-

 

1,315

 

2,023

Issuances of common stock

  

-

 

-

 

32

 

32

Dividends on common stock

  

-

 

-

 

(535)

  

(535)

Dividends & capital distributions from (to) FPL Group - net

  

25

 

857

 

(882)

  

-

Change in funds held for storm-recovery bond payments

  

14

 

-

 

-

 

14

Other - net

  

-

 

1

 

2

 

3

Net cash provided by (used in) financing activities

  

1,095

 

962

 

743

 

2,800

                   

Net increase (decrease) in cash and cash equivalents

  

818

 

(45)

  

529

 

1,302

Cash and cash equivalents at beginning of period

  

63

 

157

 

70

 

290

Cash and cash equivalents at end of period

  

$ 881

 

$ 112

 

$ 599

 

$ 1,592

Corporate & Other represents other business activities, other segments that are not separately reportable, eliminating entries, and may include the net effect of rounding.

 

 

 

FPL Group, Inc.
Condensed Consolidated Statements of Cash Flows
(millions)
(unaudited)
 

Nine Months Ended September 30, 2007

  

Florida Power
& Light

  

FPL
Energy

  

Corporate &
Other

  

FPL Group,
Inc.

Cash Flows From Operating Activities

                

Net income (loss)

  

$ 663

 

$ 468

 

$ (43)

  

$ 1,088

Adjustments to reconcile net income (loss) to net

                

    cash provided by (used in) operating activities:

                

Depreciation and amortization

  

576

 

326

 

12

 

914

Nuclear fuel amortization

  

64

 

39

 

-

 

103

Recoverable storm-related costs of FPL

  

(14)

  

-

 

-

 

(14)

Storm cost amortization

  

60

 

-

 

-

 

60

Unrealized (gains) losses on marked to market energy contracts

-

 

51

 

-

 

51

Deferred income taxes

  

111

 

145

 

(7)

  

249

Cost recovery clauses and franchise fees

  

(94)

  

-

 

-

 

(94)

Change in prepaid option premiums and derivative settlements

117

 

15

 

-

 

132

Equity in earnings of equity method investees

  

-

 

(67)

  

-

 

(67)

Distribution of earnings from equity method investees

  

-

 

128

 

-

 

128

Changes in operating assets and liabilities:

                
 

Customer receivables

  

(226)

  

(209)

  

4

 

(431)
 

Other receivables

  

(18)

  

18

 

4

 

4

 

Materials, supplies and fossil fuel inventory

  

(26)

  

(1)

  

1

 

(26)
 

Other current assets

  

(53)

  

(10)

  

4

 

(59)
 

Other assets

  

(51)

  

(8)

  

(27)

  

(86)
 

Accounts payable

  

108

 

91

 

4

 

203

 

Customer deposits

  

25

 

(1)

  

-

 

24

 

Margin cash collateral

  

79

 

21

 

(1)

  

99

 

Income taxes

  

293

 

47

 

(242)

  

98

 

Interest and other taxes

  

219

 

24

 

3

 

246

 

Other current liabilities

  

4

 

(1)

  

(1)

  

2

 

Other liabilities

  

10

 

(39)

  

29

 

-

Other - net

  

45

 

38

 

39

 

122

Net cash provided by (used in) operating activities

  

1,892

 

1,075

 

(221)

  

2,746

                   

Cash Flows From Investing Activities

                

Capital expenditures of FPL

  

(1,285)

  

-

 

-

 

(1,285)

Independent power investments

  

-

 

(2,162)

  

-

 

(2,162)

Nuclear fuel purchases

  

(169)

  

(54)

  

-

 

(223)

Other capital expenditures

  

-

 

-

 

(26)

  

(26)

Proceeds from sale of securities in special use funds

  

1,636

 

174

 

-

 

1,810

Purchases of securities in special use funds

  

(1,823)

  

(187)

  

-

 

(2,010)

Proceeds from sale of other securities

  

-

 

-

 

117

 

117

Purchases of other securities

  

-

 

-

 

(131)

  

(131)

Other - net

  

2

 

12

 

14

 

28

Net cash provided by (used in) investing activities

  

(1,639)

  

(2,217)

  

(26)

  

(3,882)

                   

Cash Flows From Financing Activities

                

Issuances of long-term debt

  

934

 

691

 

1,031

 

2,656

Retirements of long-term debt

  

(250)

  

(173)

  

(1,075)

  

(1,498)

Net change in short-term debt

  

179

 

-

 

41

 

220

Issuances of common stock

  

-

 

-

 

36

 

36

Dividends on common stock

  

-

 

-

 

(490)

  

(490)

Dividends & capital distributions from (to) FPL Group - net

  

(1,100)

  

724

 

376

 

-

Change in funds held for storm-recovery bond payments

  

(24)

  

(42)

  

-

 

(66)

Other - net

  

-

 

1

 

7

 

8

Net cash provided by (used in) financing activities

  

(261)

  

1,201

 

(74)

  

866

                   

Net increase (decrease) in cash and cash equivalents

  

(8)

  

59

 

(321)

  

(270)

Cash and cash equivalents at beginning of period

  

64

 

92

 

464

 

620

                   

Cash and cash equivalents at end of period

  

$ 56

 

$ 151

 

$ 143

 

$ 350

                   
                   

Corporate & Other represents other business activities, other segments that are not separately reportable, eliminating entries, and may include the net effect of rounding.

 

 

 

FPL Group, Inc.
Earnings Per Share Contributions
(assuming dilution)
(unaudited)
                     
   

First
Quarter

  

Second
Quarter

  

Third
Quarter

  

Fourth
Quarter

  

Year-To-Date

FPL Group - 2007 Earnings Per Share

$ 0.38

 

$ 1.01

 

$ 1.33

     

$ 2.72

                     

Florida Power & Light - 2007 Earnings Per Share

0.32

 

0.53

 

0.81

     

1.66

Customer growth

0.01

 

0.01

 

-

     

0.02

Usage due to weather

-

 

0.06

 

(0.03)

      

0.03

Underlying usage growth and price mix

-

 

(0.02)

  

(0.05)

      

(0.08)

Base rate adjustment for Turkey Point Unit No. 5

0.04

 

-

 

-

     

0.04

O&M expense

(0.06)

  

(0.01)

  

0.02

     

(0.06)

Depreciation expense

(0.01)

  

(0.01)

  

(0.01)

      

(0.03)

AFUDC

(0.01)

  

0.01

 

0.02

     

0.01

Interest expense (gross)

(0.01)

  

(0.01)

  

(0.01)

      

(0.03)

Share dilution

-

 

-

 

-

     

(0.01)

Other

(0.01)

  

(0.02)

  

0.03

     

0.04

Florida Power & Light - 2008 Earnings Per Share

0.27

 

0.54

 

0.78

     

1.59

                     

FPL Energy - 2007 Earnings Per Share

0.11

 

0.51

 

0.55

     

1.17

New investments

0.08

 

0.11

 

0.14

     

0.33

Existing assets

0.03

 

-

 

(0.04)

      

(0.01)

Asset optimization and trading

0.03

 

(0.04)

  

0.03

     

0.02

Non-qualifying hedges impact

0.19

 

(0.54)

  

0.61

     

0.26

Change in other than temporary impairment losses - net

(0.01)

  

(0.02)

  

(0.04)

      

(0.06)

Share dilution

-

 

-

 

-

     

(0.01)

Other, including interest expense

(0.02)

  

(0.01)

  

(0.05)

      

(0.08)

FPL Energy - 2008 Earnings Per Share

0.41

 

0.01

 

1.20

     

1.62

                     

Corporate and Other - 2007 Earnings Per Share

(0.05)

  

(0.03)

  

(0.03)

      

(0.11)

FPL FiberNet

-

 

-

 

-

     

-

Share dilution

-

 

(0.01)

  

(0.01)

      

-

Other, including interest expense

(0.01)

  

0.01

 

(0.02)

      

(0.04)

Corporate and Other - 2008 Earnings Per Share

(0.06)

  

(0.03)

  

(0.06)

      

(0.15)

                     

FPL Group - 2008 Earnings Per Share

$ 0.62

 

$ 0.52

 

$ 1.92

     

$ 3.06



The sum of the quarterly amounts may not equal the total for the year due to rounding.

 

 

 

 

FPL Group, Inc.
Schedule of Total Debt and Equity
(millions)
(unaudited)
 

September 30, 2008

  

Per Books

  

Adjusted 1

Long-term debt, including current maturities, and

        

commercial paper

        

Junior Subordinated Debentures2

  

$ 2,009

 

$ 850

Project debt:

        
 

Natural gas-fired assets

  

823

   
 

Wind assets

  

1,945

   
 

Hydro assets

  

700

   

Storm Securitization Debt

  

611

   

Debt with partial corporate support:

        
 

Natural gas-fired assets

  

-

   

Other long-term debt, including current maturities,

       

commercial paper, and notes payable3

  

10,946

 

10,946

Total debt

  

17,034

 

11,796

Junior Subordinated Debentures2

      

1,159

Common shareholders' equity

  

11,534

 

11,534

Total capitalization, including debt due within one year

  

$ 28,568

 

$ 24,489

           

Debt ratio

  

60%

  

48%




December 31, 2007

Per Books

Adjusted 1

Long-term debt, including current maturities, and

        

commercial paper

        

Junior Subordinated Debentures2

  

$ 2,009

 

$ 850

Project debt:

        
 

Natural gas-fired assets

  

320

   
 

Wind assets

  

1,903

   
 

Hydro assets

  

700

   

Storm Securitization Debt

  

652

   

Debt with partial corporate support:

        
 

Natural gas-fired assets

  

335

   

Other long-term debt, including current maturities, and

        

commercial paper3

  

7,779

 

7,779

Total debt

  

13,698

 

8,629

Junior Subordinated Debentures2

      

1,159

Common shareholders' equity

  

10,735

 

10,735

Total capitalization, including debt due within one year

  

$ 24,433

 

$ 20,523

           

Debt ratio

  

56%

  

42%



1 Ratios exclude impact of imputed debt for purchase power obligations

2 Adjusted to reflect preferred stock characteristics of these securities (preferred trust securities and junior subordinated debentures)

3 Includes premium and discount on all debt issuances

 

 

 

FPL Group, Inc.
Long-Term Debt and Commercial Paper
September 30, 2008
(millions)
(unaudited)

Type of Debt

Interest
Rate (%)

Maturity
Date

Total
Debt

Current Portion

Long-Term Portion

Long-Term:

                    
 

Florida Power & Light

                    
   

First Mortgage Bonds:

                    
   

First Mortgage Bonds

  

5.875

 

04/01/09

  

225

 

225

 

-

   

First Mortgage Bonds

  

4.850

 

02/01/13

  

400

 

-

 

400

   

First Mortgage Bonds

  

5.850

 

02/01/33

  

200

 

-

 

200

   

First Mortgage Bonds

  

5.950

 

10/01/33

  

300

 

-

 

300

   

First Mortgage Bonds

  

5.625

 

04/01/34

  

500

 

-

 

500

   

First Mortgage Bonds

  

5.650

 

02/01/35

  

240

 

-

 

240

   

First Mortgage Bonds

  

4.950

 

06/01/35

  

300

 

-

 

300

   

First Mortgage Bonds

  

5.400

 

09/01/35

  

300

 

-

 

300

   

First Mortgage Bonds

  

6.200

 

06/01/36

  

300

 

-

 

300

   

First Mortgage Bonds

  

5.650

 

02/01/37

  

400

 

-

 

400

   

First Mortgage Bonds

  

5.850

 

05/01/37

  

300

 

-

 

300

   

First Mortgage Bonds

  

5.550

 

11/01/17

  

300

 

-

 

300

   

First Mortgage Bonds

  

5.950

 

02/01/38

  

600

 

-

 

600

     

Total First Mortgage Bonds

      

4,365

 

225

 

4,140

   

Revenue Refunding Bonds:

                
   

Miami-Dade Solid Waste Disposal

VAR

 

02/01/23

  

15

 

-

 

15

   

St. Lucie Solid Waste Disposal

VAR

 

05/01/24

  

79

 

-

 

79

     

Total Revenue Refunding Bonds

      

94

 

-

 

94

   

Pollution Control Bonds:

                    
   

Dade

  

VAR

 

04/01/20

  

9

 

-

 

9

   

Martin

  

VAR

 

07/15/22

  

96

 

-

 

96

   

Jacksonville

  

VAR

 

09/01/24

  

46

 

-

 

46

   

Manatee

  

VAR

 

09/01/24

  

16

 

-

 

16

   

Putnam

  

VAR

 

09/01/24

  

4

 

-

 

4

   

Jacksonville

  

VAR

 

05/01/27

  

28

 

-

 

28

   

St. Lucie

  

VAR

 

09/01/28

  

242

 

-

 

242

   

Jacksonville

  

VAR

 

05/01/29

  

52

 

-

 

52

     

Total Pollution Control Bonds

      

493

 

-

 

493

   

Industrial Bonds - Dade

  

VAR

 

06/01/21

  

46

 

-

 

46

   

Storm Securitization Bonds:

                
   

Storm Securitization Bonds

5.053

 

02/01/11

  

83

 

38

 

45

   

Storm Securitization Bonds

5.044

 

08/01/13

  

140

 

-

 

140

   

Storm Securitization Bonds

5.127

 

08/01/15

  

100

 

-

 

100

   

Storm Securitization Bonds

5.256

 

08/01/19

  

288

 

-

 

288

     

Total Storm Securitization Bonds

      

611

 

38

 

573

   

Unamortized discount

        

(36)

  

-

 

(36)
 

TOTAL FLORIDA POWER & LIGHT

      

5,573

 

263

 

5,310

 

FPL Group Capital

                  
   

Debentures:

                  
   

Debentures

7.375

 

06/01/09

  

225

 

225

 

-

   

Debentures

7.375

 

06/01/09

  

400

 

400

 

-

   

Debentures

5.625

 

09/01/11

  

600

 

-

 

600

   

Debentures (Junior Subordinated)

5.875

 

03/15/44

  

309

 

-

 

309

   

Debentures (Junior Subordinated)

6.600

 

10/01/66

  

350

 

-

 

350

   

Debentures (Junior Subordinated)

6.350

 

10/01/66

  

350

 

-

 

350

   

Debentures (Junior Subordinated)

6.650

 

06/15/67

  

400

 

-

 

400

   

Debentures (Junior Subordinated)

7.300

 

09/01/67

  

250

 

-

 

250

   

Debentures (Junior Subordinated)

7.450

 

09/01/67

  

350

 

-

 

350

   

Debentures

  

5.350

 

06/01/13

  

250

 

-

 

250

   

Floating Debenture

  

VAR

 

06/01/11

  

250

 

-

 

250

     

Total Debentures

          

3,734

 

625

 

3,109

   

Term Loans:

                    
   

Term Loans

  

VAR

 

06/10/10

  

200

 

-

 

200

   

Term Loans

  

VAR

 

03/25/11

  

100

 

-

 

100

   

Term Loans

  

VAR

 

03/27/11

  

100

 

-

 

100

   

Term Loans

  

VAR

 

10/31/09

  

100

 

-

 

100

   

Term Loans

  

VAR

 

03/25/11

  

200

 

-

 

200

   

Term Loans

  

VAR

 

09/16/11

  

200

 

-

 

200

   

Term Loans

  

VAR

 

09/17/11

  

120

 

-

 

120

     

Total Term Loans

          

1,020

 

-

 

1,020

   

Fair value swaps

          

5

 

-

 

5

   

Unamortized discount

          

(2)

  

-

 

(2)
 

FPL Energy

                    
   

Senior Secured Bonds:

                    
   

Senior Secured Bonds

6.876

 

06/27/17

  

77

 

11

 

66

   

Senior Secured Bonds

  

6.125

 

03/25/19

  

75

 

8

 

67

   

Senior Secured Bonds

  

6.639

 

06/20/23

  

259

 

31

 

228

   

Senior Secured Bonds

  

5.608

 

03/10/24

  

295

 

23

 

272

   

Senior Secured Bonds

  

7.520

 

06/30/19

  

204

 

15

 

189

     

Total Senior Secured Bonds

      

910

 

88

 

822

   

Senior Secured Notes:

                    
   

Senior Secured Notes

  

7.260

 

07/20/15

  

125

 

-

 

125

   

Senior Secured Notes

  

6.310

 

07/10/17

  

290

 

-

 

290

   

Senior Secured Notes

  

6.610

 

07/10/27

  

35

 

-

 

35

   

Senior Secured Notes

  

6.960

 

07/10/37

  

250

 

-

 

250

   

Senior Secured Notes

  

7.110

 

06/28/20

  

94

 

6

 

88

   

Senior Secured Notes

  

6.665

 

01/10/31

  

166

 

11

 

155

   

Senior Secured Notes

  

7.590

 

07/10/18

  

525

 

-

 

525

   

Limited-recourse Senior Secured Notes

7.510

 

07/20/21

  

18

 

1

 

17

     

Total Senior Secured Bonds

      

1,503

 

18

 

1,485

   

Credit Facility

  

VAR

 

06/23/11

  

148

 

-

 

148

   

Other Debt:

                    
   

Other Debt

  

8.450

 

11/30/12

  

44

 

9

 

35

   

Other Debt

  

VAR

 

12/31/17

  

81

 

12

 

69

   

Other Debt

  

8.010

 

12/31/18

  

2

 

-

 

2

   

Other Debt

  

Part fixed & VAR

11/30/19

  

226

 

22

 

204

   

Other Debt

  

VAR

 

01/31/22

  

530

 

99

 

431

   

Other Debt

  

VAR

 

12/31/12

  

218

 

43

 

175

     

Total Other Debt

          

1,101

 

185

 

916

     

Unamortized discount

          

1

 

-

 

1

   

TOTAL FPL ENERGY

          

3,663

 

291

 

3,372

Commercial Paper and Notes Payable:

                
 

FPL

        

1,550

 

1,550

 

-

 

Capital

        

1,490

 

1,490

 

-

 

TOTAL FPL GROUP CAPITAL

      

9,910

 

2,406

 

7,504

 

TOTAL FPL GROUP, INC.

        

$17,033

 

$ 4,219

 

$ 12,814

 

May not agree to financial statements due to rounding.

 

Florida Power & Light Company

                    

Statistics

                    

(unaudited)

                    
                       
     

Quarter

 

Year to Date

   

Periods Ended September 30

  

2008

  

2007

  

2008

  

2007

    

Energy sales (million kwh)

                    

Residential

  

16,265

 

17,378

 

41,048

 

41,752

   

Commercial

  

12,381

 

12,607

 

34,433

 

34,235

   

Industrial

 

890

 

938

 

2,735

 

2,857

   

Public authorities

  

133

 

147

 

404

 

439

   

Increase (decrease) in unbilled sales

  

391

 

336

 

1,310

 

1,076

   

Total retail

  

30,060

 

31,406

 

79,930

 

80,359

   

Electric utilities

  

278

 

437

 

783

 

1,178

   

Interchange power sales

  

210

 

342

 

1,227

 

1,534

   

Total

  

30,548

 

32,185

 

81,940

 

83,071

   

                       
                       

Average price (cents/kwh) 1

                    

Residential

  

11.94

 

11.49

 

11.54

 

11.40

   

Commercial

  

10.37

 

9.85

 

10.09

 

9.96

   

Industrial

  

8.84

 

8.41

 

8.49

 

8.53

   

Total

  

11.20

 

10.69

 

10.81

 

10.64

   
                       

Average customer accounts (000's)

                    

Residential

  

3,989

 

3,989

 

3,996

 

3,978

   

Commercial

  

502

 

496

 

500

 

492

   

Industrial

  

13

 

18

 

14

 

20

   

Other

  

3

 

3

 

3

 

3

   

Total

  

4,507

 

4,506

 

4,513

 

4,493

   

                       

End of period customer accounts (000's)

                    

Residential

  

3,985

 

3,990

 

N/A

  

N/A

    

Commercial

  

502

 

497

 

N/A

  

N/A

    

Industrial

  

13

 

17

 

N/A

  

N/A

    

Other

  

3

 

3

 

N/A

  

N/A

    

Total

  

4,503

 

4,508

 

N/A

  

N/A

    

                       

1 Excludes interchange power sales, net change in unbilled revenues, deferrals under cost recovery clauses and any provision for refund.
                       
                       
     

2008

  

Normal

 

2007

        

                       

Three Months Ended September 30

                    
 

Cooling degree-days

  

917

 

872

 

967

       
 

Heating degree-days

  

-

 

-

 

-

       

Nine Months Ended September 30

                    
 

Cooling degree-days

  

1,583

 

1,411

 

1,511

       
 

Heating degree-days

  

103

 

208

 

142

       
                       

Cooling degree days for the periods above use a 72 degree base temperature and heating degree days use a 66 degree base temperature.