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Segment Information
 12 Months Ended
Dec. 31, 2011
Segment Reporting [Abstract]  
Segment Information
Segment Information
The following segment presentation is based on the methodology that management uses for making operating decisions and assessing performance of its various business activities. A reconciliation of the segment presentation to the GAAP financial statements is provided.
PNM Electric
PNM Electric includes the retail electric utility operations of PNM that are subject to traditional rate regulation by the NMPRC. PNM Electric provides integrated electricity services that include the generation, transmission, and distribution of electricity for retail electric customers in New Mexico as well as the sale of transmission to third parties. PNM Electric also includes the generation and sale of electricity into the wholesale market. This includes the asset optimization of PNM’s jurisdictional assets as well as the capacity excluded from retail rates. FERC has jurisdiction over wholesale rates.
TNMP Electric
TNMP Electric is an electric utility providing regulated transmission and distribution services in Texas under the TECA. TNMP’s operations are subject to traditional rate regulation by the PUCT.
PNM Gas
PNM Gas distributed natural gas to most of the major communities in New Mexico, subject to traditional rate regulation by the NMPRC. As described in Note 2, PNM completed the sale of its gas operations on January 30, 2009. PNM Gas is reported as discontinued operations and is not included in the segment information presented below. See Note 22.
First Choice
First Choice, which was sold by PNMR on November 1, 2011 (Note 2), operated as a certified retail electric provider. First Choice provided electricity to residential, small commercial, and governmental customers. Although First Choice was regulated in certain respects by the PUCT, it was not subject to traditional rate regulation.
Optim Energy
Optim Energy was considered a separate segment for PNMR. PNMR’s investment in Optim Energy was held in the Corporate and Other segment Optim Energy’s revenues and expenses are not included in PNMR’s consolidated revenues and expenses or the following tables. See Note 21.
Corporate and Other
PNMR Services Company is included in the Corporate and Other segment.
 

The following tables present summarized financial information for PNMR by segment. Excluding PNM Gas, which is presented as discontinued operations, PNM has only one segment. TNMP operates in only one segment. Therefore, tabular segment information is not presented for PNM and TNMP. Explanations for footnotes follow the tables.
PNMR SEGMENT INFORMATION
 
2011
PNM
Electric
 
TNMP
Electric
 
First
Choice
 
Corporate
and Other
 
Consolidated
 
 
 
 
 
(In thousands)
 
 
 
 
Operating revenues
$
1,057,289

 
$
204,045

 
$
439,450

 
$
(165
)
 
$
1,700,619

Intersegment revenues
—

 
33,813

 
—

 
(33,813
)
 
—

Total revenues
1,057,289

 
237,858

 
439,450

 
(33,978
)
 
1,700,619

Cost of energy
362,237

 
41,166

 
323,331

 
(33,812
)
 
692,922

Gross margin
695,052

 
196,692

 
116,119

 
(166
)
 
1,007,697

Other operating expenses
438,822

 
88,234

 
75,966

 
(9,671
)
 
593,351

Depreciation and amortization
94,787

 
44,616

 
1,098

 
16,546

 
157,047

Operating income (loss)
161,443

 
63,842

 
39,055

 
(7,041
)
 
257,299

Interest income
15,562

 
2

 
64

 
(113
)
 
15,515

Gain on sale of First Choice
—

 
—

 
—

 
174,925

 
174,925

Other income (deductions)
4,309

 
1,580

 
(650
)
 
(15,660
)
 
(10,421
)
Net interest charges
(75,349
)
 
(29,286
)
 
(581
)
 
(19,633
)
 
(124,849
)
Earnings before income taxes
105,965

 
36,138

 
37,888

 
132,478

 
312,469

Income taxes
37,427

 
13,881

 
13,772

 
56,455

 
121,535

Earnings from continuing operations
68,538

 
22,257

 
24,116

 
76,023

 
190,934

Valencia non-controlling interest
(14,047
)
 
—

 
—

 
—

 
(14,047
)
Subsidiary preferred stock dividends
(528
)
 
—

 
—

 
—

 
(528
)
Segment earnings from continuing operations attributable to PNMR
$
53,963

 
$
22,257

 
$
24,116

 
$
76,023

 
$
176,359

Gross property additions
$
251,345

 
$
67,407

 
$
2,089

 
$
6,090

 
$
326,931

At December 31, 2011:
 
 
 
 
 
 
 
 
 
Total Assets
$
4,095,287

 
$
1,037,445

 
$
—

 
$
71,881

 
$
5,204,613

Goodwill
$
51,632

 
$
226,665

 
$
—

 
$
—

 
$
278,297

Additions to utility plant and non-utility plant included in accounts payable
$
26,815

 
$
4,736

 
$
—

 
$
2,104

 
$
33,655

2010
PNM
Electric
 
TNMP
Electric
 
First
Choice
 
Corporate
and Other
 
Consolidated
 
 
 
 
 
(In thousands)
 
 
 
 
Operating revenues
$
1,017,128

 
$
173,504

 
$
483,203

 
$
(318
)
 
$
1,673,517

Intersegment revenues
—

 
39,084

 
—

 
(39,084
)
 
—

Total revenues
1,017,128

 
212,588

 
483,203

 
(39,402
)
 
1,673,517

Cost of energy
352,270

 
37,064

 
350,476

 
(39,083
)
 
700,727

Gross margin
664,858

 
175,524

 
132,727

 
(319
)
 
972,790

Other operating expenses
424,455

 
77,387

 
92,077

 
(12,285
)
 
581,634

Depreciation and amortization
92,281

 
41,726

 
864

 
16,833

 
151,704

Operating income (loss)
148,122

 
56,411

 
39,786

 
(4,867
)
 
239,452

Interest income
18,854

 
1

 
18

 
23

 
18,896

Equity in net earnings (loss) of Optim Energy
—

 
—

 
—

 
(203,399
)
 
(203,399
)
Other income (deductions)
12,712

 
771

 
(411
)
 
(6,027
)
 
7,045

Net interest charges
(72,400
)
 
(31,157
)
 
(1,268
)
 
(20,548
)
 
(125,373
)
Earnings (loss) before income taxes
107,288

 
26,026

 
38,125

 
(234,818
)
 
(63,379
)
Income taxes (benefit)
36,427

 
10,044

 
14,064

 
(92,790
)
 
(32,255
)
Earnings (loss) from continuing operations
70,861

 
15,982

 
24,061

 
(142,028
)
 
(31,124
)
Valencia non-controlling interest
(13,563
)
 
—

 
—

 
—

 
(13,563
)
Subsidiary preferred stock dividends
(528
)
 
—

 
—

 
—

 
(528
)
Segment earnings (loss) from continuing operations attributable to PNMR
$
56,770

 
$
15,982

 
$
24,061

 
$
(142,028
)
 
$
(45,215
)
Gross property additions
$
226,766

 
$
41,018

 
$
3,046

 
$
10,658

 
$
281,488

At December 31, 2010:
 
 
 
 
 
 
 
 
 
Total Assets
$
3,875,573

 
$
1,010,957

 
$
218,411

 
$
120,142

 
$
5,225,083

Goodwill
$
51,632

 
$
226,665

 
$
43,013

 
$
—

 
$
321,310


2009
PNM
Electric
 
TNMP
Electric
 
First
Choice
 
Corporate
and Other
 
Consolidated
 
 
 
 
 
(In thousands)
 
 
 
 
Operating revenues
$
967,998

 
$
151,294

 
$
528,818

 
$
(366
)
 
$
1,647,744

Intersegment revenues
11

 
41,338

 
—

 
(41,349
)
 
—

Total revenues
968,009

 
192,632

 
528,818

 
(41,715
)
 
1,647,744

Cost of energy
378,145

 
34,728

 
346,454

 
(41,338
)
 
717,989

Gross margin
589,864

 
157,904

 
182,364

 
(377
)
 
929,755

Other operating expenses
420,473

 
75,540

 
107,354

 
(13,503
)
 
589,864

Depreciation and amortization
92,140

 
37,262

 
1,809

 
16,738

 
147,949

Operating income (loss)
77,251

 
45,102

 
73,201

 
(3,612
)
 
191,942

Interest income
30,543

 
9

 
56

 
(2,219
)
 
28,389

Equity in net earnings (loss) of Optim Energy
—

 
—

 
—

 
(30,145
)
 
(30,145
)
Other income (deductions)
6,891

 
2,860

 
(438
)
 
17,457

 
26,770

Net interest charges
(69,058
)
 
(27,820
)
 
(2,782
)
 
(22,545
)
 
(122,205
)
Earnings (loss) before income taxes
45,627

 
20,151

 
70,037

 
(41,064
)
 
94,751

Income taxes (benefit)
13,726

 
7,985

 
25,622

 
(18,515
)
 
28,818

Earnings (loss) from continuing operations
31,901

 
12,166

 
44,415

 
(22,549
)
 
65,933

Valencia non-controlling interest
(11,890
)
 
—

 
—

 
—

 
(11,890
)
Subsidiary preferred stock dividends
(528
)
 
—

 
—

 
—

 
(528
)
Segment earnings (loss) from continuing operations attributable to PNMR
$
19,483

 
$
12,166

 
$
44,415

 
$
(22,549
)
 
$
53,515

Gross property additions (1)
$
253,335

 
$
53,063

 
$
863

 
$
16,462

 
$
284,597

At December 31, 2009:
 
 
 
 
 
 
 
 
 
Total Assets
$
3,775,166

 
$
1,009,055

 
$
197,062

 
$
378,638

 
$
5,359,921

Goodwill
$
51,632

 
$
226,665

 
$
43,013

 
$
—

 
$
321,310


(1) 
Excludes gross property additions related to PNM Gas discontinued operations of $3,434 and includes PNM’s purchase of an interest in PVNGS Unit 2 from another subsidiary of PNMR of $39,126.
Major Customers
No individual customers accounted for more than 10% of the operating revenues of PNMR or PNM. First Choice is a customer of TNMP and accounted for 17% of its operating revenues from continuing operations in 2011, 18% in 2010, and 21% in 2009. One unaffiliated customer of TNMP accounted for 19% of its operating revenues from continuing operations in 2011, 19% in 2010, and 20% in 2009. Another unaffiliated customer of TNMP accounted for 12% of its operating revenues from continuing operations in 2011, 13% in 2010, and 13% in 2009.