8-K 1 f8k110105.htm EARNINGS RELEASE DATA Earnings Release Data
 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549


FORM 8-K


CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): November 1, 2005

 
Exact name of registrant as specified
I.R.S.
 
in its charter, state of incorporation,
Employer
Commission
address of principal executive offices,
Identification
File Number
Telephone
Number


1-16305
PUGET ENERGY, INC.
91-1969407
 
A Washington Corporation
 
 
10885 - N.E. 4th Street, Suite 1200
 
 
Bellevue, Washington 98004-5591
 
 
(425) 454-6363
 

 
1-4393
PUGET SOUND ENERGY, INC.
91-0374630
 
A Washington Corporation
 
 
10885 - N.E. 4th Street, Suite 1200
 
 
Bellevue, Washington 98004-5591
 
 
(425) 454-6363
 
 
___________
 
Check the appropriate box below if the Form 8−K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
o
 
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
o
 
Soliciting material pursuant to Rule 14a−12 under the Exchange Act (17 CFR 240.14a−12)
 
o
 
Pre−commencement communications pursuant to Rule 14d−2(b) under the Exchange Act (17 CFR 240.14d−2(b))
 
o
 
Pre−commencement communications pursuant to Rule 13e−4(c) under the Exchange Act (17 CFR 240.13e−4(c))
 
 

Item 2.02 Results of Operations and Financial Condition
On November 1, 2005 the Company issued the following press release.

Puget Energy reports third-quarter 2005 earnings
Washington regulators approve all-party regulatory settlement for power cost rate case

Bellevue, Wash. (November 1, 2005) — Puget Energy (NYSE: PSD) today reported third quarter 2005 net income from continuing operations of $5.9 million, or 6 cents per diluted share, compared to net income of $9.4 million, or 9 cents per share, in the third quarter of 2004.
Puget Energy’s electric and natural gas utility, Puget Sound Energy (PSE), reported third quarter 2005 net income of $6.2 million compared to third quarter 2004 net income of $9.6 million. Higher utility operations and maintenance costs and plant depreciation expense during the third quarter 2005 offset the impact of an increase in margins from higher energy sales to electric and natural gas customers.
On October 26, 2005, Puget Energy sold 15 million shares of common stock. The $310 million in net proceeds from this issuance will be invested in PSE to repay short-term debt incurred primarily to fund the utility’s construction program.
“We’re investing in necessary energy infrastructure to provide safe, reliable service to our growing region,” said Puget Energy Chairman, President and CEO Stephen P. Reynolds. “We are also highlighting our energy efficiency programs to help our customers manage through this period of high energy prices,” added Reynolds.
“As part of our long-term resource plan, the 150 megawatt Hopkins Ridge wind power project received regulatory approval and is on track to begin serving customers by year-end. We have also begun construction on our second, larger wind power project and will begin our review of a new series of electric generating resources.” said Reynolds.
Puget Energy reaffirmed previously announced 2005 earnings guidance from continuing operations of $1.30 to $1.40 per diluted share, assuming normal weather patterns in the fourth quarter of 2005.


Third Quarter 2005 Summary for Puget Sound Energy (PSE)
·  
PSE reported income for common stock of $6.2 million for the third quarter of 2005, or 6 cents per diluted share, compared with income for common stock of $9.6 million, or 10 cents per share for the same period in 2004.

·  
PSE’s electric sales volumes to retail customers increased by 1.5 percent in the third quarter of 2005 compared to the same period in 2004. Over the last twelve months the number of PSE’s electric customers increased by 1.8 percent. PSE’s electric margin increased by $0.4 million pre-tax in the third quarter of 2005 compared to the same period in 2004.

·  
PSE’s natural gas sales volumes to retail customers increased by 1.3 percent in the third quarter of 2005 compared to the same period a year ago. Over the last twelve months the number of PSE’s natural gas customers increased by 2.9 percent. Gas margin for the third quarter of 2005 grew by $4.4 million pre-tax compared to the same period in 2004 reflecting higher sales volumes and a March 2005 general tariff rate increase.

·  
PSE’s utility operations and maintenance expenses increased by $14.5 million pre-tax in the third quarter of 2005 compared to the same period in 2004. The increase in 2005 was largely driven by higher planned maintenance costs at company-owned energy production and delivery facilities and employee pension and benefit expense.

·  
PSE’s depreciation and amortization expenses increased by $3.0 million pre-tax in the third quarter of 2005 compared to the third quarter of 2004 reflecting the addition of new utility infrastructure.


InfrastruX Group (InfrastruX)
Puget Energy reports the financial results of InfrastruX in 2005 as discontinued operations, following the accounting guidance of FAS-144 “Accounting for the Impairment or Disposal of Long-Lived Assets”. For additional information regarding InfrastruX’s financial performance during the third quarter 2005 please refer to Puget Energy’s Form 10-Q for the period ended September 30, 2005.

 Puget Energy Third Quarter 2005 vs. Third Quarter 2004 EPS Reconciliation      
   
Cents per
diluted share
  
Puget Energy Q3 2004 Reported Earnings from Continuing Operations
  
$
0.09
  
Increase in utility energy margins in 2005
    
0.03
  
Increase in utility O&M expense in 2005
    
(0.08
)
Increase in utility depreciation expense in 2005
    
(0.02
)
Decrease in property and income taxes
    
0.02
  
All other variances, net
    
0.02
  
Puget Energy Q3 2005 Earnings from Continuing Operations
  
$
0.06
  

 
Form 10-Q Quarterly Report for the Third Quarter of 2005
Puget Energy provided additional information on its third quarter 2005 financial results in a Form 10-Q, filed with the Securities and Exchange Commission on November 1, 2005. A copy of the Form 10-Q is available through the SEC’s web site at www.sec.gov or at the Company’s web site at www.pugetenergy.com. Investors are encouraged to read the financial statements and disclosures contained in the Form 10-Q filing.


Calendar Year 2006 Earnings Guidance
Puget Energy today reaffirmed its previously announced earnings guidance for calendar year 2006 of $1.40 to $1.55 per diluted share from continuing operations, assuming normal weather conditions.


Third Quarter 2005 Earnings Presentation Webcast
A management discussion of the third quarter results is scheduled for 10 a.m. ET (7 a.m. PT) on Wednesday, November 2, 2005. A live webcast of the presentation can be accessed through the "Shareholders and Analysts" section at www.pugetenergy.com. The webcast will be archived and available for replay following the live broadcast through midnight (ET) on Wednesday, November 16, 2005. A recorded replay of the conference call also will be available two hours after completion on November 2 through midnight (ET) November 16, 2005. To access the recording, dial 1-888-286-8010, and enter the conference I.D. number 39996436.

Puget Energy is an energy services holding company that conducts all of its operations through its subsidiaries, PSE and InfrastruX Group. PSE is a regulated utility company that generates, purchases and sells electricity; and purchases, transports and sells natural gas. The service territory of PSE covers approximately 6,000 square miles, principally in the Puget Sound region of Washington State. InfrastruX specializes in contracting services to other gas and electric utilities primarily in the Midwest, Texas, and the south-central and eastern United States regions.
 
CAUTIONARY STATEMENT: Certain statements contained in this press release are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, among which include Puget Energy's anticipated 2005 and 2006 financial results, including its earnings guidance. Forward-looking statements are based on the opinions and estimates of management at the time the statements are made and are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated in the forward-looking statements. Factors that could affect actual results include, among others, governmental policies and regulatory actions, including those of the WUTC, and weather conditions. More information about these and other factors that potentially could affect the company’s financial results is included in Puget Energy's and PSE's most recent annual report on Form 10-K, quarterly report on Form 10-Q and in their other public filings filed with the Securities and Exchange Commission. Except as required by law, Puget Energy and PSE undertake no obligation to update any forward-looking statements.
 
 
PUGET ENERGY -- SUMMARY INCOME STATEMENT
             
(In thousands, except per-share amounts)
                   
   
Unaudited
  
 Unaudited
  
   
Three months ended 9/301
  
 Nine months ended 9/30
  
   
2005
  
2004
  
 2005
  
2004
  
                    
Operating revenues
                   
Electric
  
$
375,035
  
$
322,669
  
$
1,140,545
  
$
1,018,256
  
Gas
    
111,042
   
89,432
   
594,737
   
484,603
 
Other
    
4,306
   
2,925
   
6,866
   
4,005
 
Total operating revenues
    
490,383
   
415,026
   
1,742,148
   
1,506,864
 
Operating expenses
                          
Purchased electricity
    
200,861
   
147,589
   
587,983
   
517,803
 
Electric generation fuel
    
21,058
   
25,130
   
54,400
   
60,132
 
Residential exchange
    
(34,525
)
  
(34,014
)
  
(126,676
)
  
(123,799
)
Purchased gas
    
59,151
   
44,574
   
359,037
   
270,683
 
Unrealized net (gain) loss on derivative instruments
    
477
   
1,894
   
395
   
(1,042
)
Utility operations & maintenance
    
81,645
   
67,093
   
240,299
   
214,149
 
Other operations & maintenance
    
745
   
529
   
2,045
   
1,513
 
Depreciation & amortization
    
60,550
   
57,598
   
178,284
   
170,036
 
Conservation amortization
    
5,633
   
4,747
   
16,746
   
17,746
 
Taxes other than income taxes
    
44,784
   
42,710
   
165,005
   
149,486
 
Income taxes
    
2,476
   
6,958
   
54,649
   
40,621
 
Total operating expenses
    
442,855
   
364,808
   
1,532,167
   
1,317,328
 
Operating income
    
47,528
   
50,218
   
209,981
   
189,536
 
Other income (deductions):
                          
Other income
    
1,422
   
356
   
4,184
   
1,994
 
Interest Charges:
                          
AFUDC
    
2,680
   
1,650
   
6,183
   
3,807
 
Interest expense
    
(45,695
)
  
(42,754
)
  
(130,307
)
  
(128,796
)
Mandatorily redeemable securities interest expense
    
(23
)
  
(23
)
  
(68
)
  
(68
)
Income from continuing operations
    
5,912
   
9,447
   
89,973
   
66,473
 
Income (loss) from discontinued operations, net of tax
    
(1
)
  
1,677
   
908
   
4,237
 
Net Income
 
$
5,911
  
$
11,124
  
$
90,881
  
$
70,710
  
                           
Common shares outstanding
   
100,371
   
99,580
   
100,160
   
99,373
 
Diluted shares outstanding
   
100,964
   
100,043
   
100,754
   
99,836
 
Basic earnings per common share from
                          
continuing operations
  
$
0.06
  
$
0.09
  
$
0.90
  
$
0.67
  
Basic earnings from discontinued operations
    
--
   
0.02
   
0.01
   
0.04
 
Basic earnings per common share
  
$
0.06
  
$
0.11
  
$
0.91
  
$
0.71
  
                           
Diluted earnings per common share from
                          
continuing operations
  
$
0.06
  
$
0.09
  
$
0.89
  
$
0.67
  
Diluted earnings from discontinued operations
    
--
   
0.02
   
0.01
   
0.04
 
Diluted earnings per common share2
  
$
0.06
  
$
0.11
  
$
0.90
  
$
0.71
  
 

1  Partial-year results may not accurately predict full-year performance, as earnings are significantly affected by weather.
2 Diluted earnings per common share include the dilutive effect of securities related to employee compensation plans.
 
 
 
PUGET SOUND ENERGY -- UTILITY OPERATING DATA  
  
   
Three months ended 9/30
  
 Nine months ended 9/30
  
   
2005
  
2004
  
 2005
  
2004
  
Energy sales revenues ($ in thousands; unaudited)
                   
Electricity
                          
Residential
  
$
131,719
  
$
122,397
  
$
496,517
  
$
459,058
  
Commercial
    
153,138
   
143,711
   
461,073
   
428,877
 
Industrial
   
23,667
   
22,165
   
68,902
   
65,318
 
Other retail sales, including change in unbilled
   
6,810
   
5,379
   
(7,584
)
  
(11,199
)
Subtotal, retail sales
    
315,334
   
293,652
   
1,018,908
   
942,054
 
Transportation, including change in unbilled
    
1,654
   
2,728
   
6,741
   
7,342
 
Sales to other utilities & marketers
    
40,626
   
16,558
   
73,818
   
38,793
 
Other 1
    
17,421
   
9,731
   
41,078
   
30,067
 
Total electricity sales
    
375,035
   
322,669
   
1,140,545
   
1,018,256
 
Gas
                          
Residential
    
57,260
   
47,100
   
360,660
   
295,381
 
Commercial
    
37,252
   
29,047
   
178,878
   
144,155
 
Industrial
   
9,221
   
6,864
   
32,247
   
25,436
 
Subtotal, retail sales
    
103,733
   
83,011
   
571,785
   
464,972
 
Transportation
    
3,332
   
3,133
   
9,944
   
9,679
 
Other
    
3,977
   
3,288
   
13,008
   
9,952
 
Total gas sales
    
111,042
   
89,432
   
594,737
   
484,603
 
Total energy sales revenues
  
$
486,077
  
$
412,101
  
$
1,735,282
  
$
1,502,859
  
Energy sales volumes (Unaudited)
                          
Electricity (in mWh)
                          
Residential
   
1,957,275
   
1,930,772
   
7,515,907
   
7,367,917
 
Commercial
   
2,168,625
   
2,146,246
   
6,432,239
   
6,314,739
 
Industrial
   
352,808
   
351,834
   
1,014,948
   
1,009,456
 
Other, including change in unbilled
    
51,992
   
33,569
   
(229,003
)
  
(269,805
)
Subtotal, retail sales
    
4,530,700
   
4,462,421
   
14,734,091
   
14,422,307
 
Transportation, including change in unbilled
    
516,588
   
530,204
   
1,516,519
   
1,473,619
 
Sales to other utilities & marketers
    
705,593
   
379,280
   
1,498,527
   
930,570
 
Total mWh
   
5,752,881
   
5,371,905
   
17,749,137
   
16,826,496
 
Gas (in 000's of therms)
                          
Residential
   
43,750
   
43,403
   
322,792
   
315,128
 
Commercial
   
36,551
   
35,067
   
183,011
   
182,748
 
Industrial
   
10,052
   
9,206
   
34,897
   
34,143
 
Transportation
   
44,306
   
45,238
   
145,870
   
148,834
 
Total gas volumes
    
134,659
   
132,914
   
686,570
   
680,853
 
Margins 2 ($ in thousands; unaudited)
                          
Electric
  
$
149,627
  
$
149,271
  
$
503,605
  
$
451,997
  
Gas
    
38,793
   
34,349
   
171,971
   
163,035
 
Customers served 3 (Unaudited)
                          
Electricity
                         
Residential
   
894,929
   
879,742
   
891,508
   
875,579
 
Commercial
    
112,428
   
109,781
   
111,628
   
108,939
 
Industrial
   
3,903
   
3,957
   
3,914
   
3,993
 
Other
    
2,462
   
2,221
   
2,406
   
2,170
 
Transportation
   
17
   
17
   
17
   
17
 
Total electricity customers
    
1,013,739
   
995,718
   
1,009,473
   
990,698
 
Gas
                          
Residential
   
629,963
   
611,534
   
627,123
   
607,654
 
Commercial
   
50,637
   
49,591
   
50,564
   
49,458
 
Industrial
   
2,674
   
2,708
   
2,691
   
2,727
 
Transportation
   
130
   
129
   
130
   
129
 
Total gas customers
    
683,404
   
663,962
   
680,508
   
659,968
 
Weather (Unaudited)
                          
Actual heating degree days
    
212
   
219
   
2,811
   
2,779
 
Normal heating degree days 4
    
238
   
238
   
3,068
   
3,068
 
 

1  Includes sales of non-core gas supplies.
2  Electric margin is electric sales to retail and transportation customers less the cost of generating and purchasing electric energy sold to customers, including transmission costs, to bring electric energy to PSE's service territory.  Gas margin is gas sales to retail and transportation customers less the cost of gas purchased, including gas transportation costs, to bring gas to PSE's service territory.
3  Customers represents aerage served during the period.
4  Seattle-Tacoma Airport statistics reported by NOAA which are based on a 30-year average, 1971-2000.  Heating degree days meaure how far the daily average temperature falls below 65 degrees.  Heating degree days in 2004 are adjusted for leap year by adding the February 28th heating degree day amount.
 
 
 


SIGNATURE
 
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrants have duly caused this report to be signed on their behalf by the undersigned hereunto duly authorized.
 
 
PUGET ENERGY, INC.
 
 
 
 
 
PUGET SOUND ENERGY, INC.
 
 
 
 
 
By: /s/ James W. Eldredge
 
 
 
Dated: November 1, 2005
James W. Eldredge
Vice President, Corporate Secretary
and Chief Accounting Officer