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): August 7, 2014
Consolidated Edison, Inc.
(Exact name of registrant as specified in its charter)
| New York | 1-14514 | 13-3965100 | ||
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
| 4 Irving Place, New York, New York | 10003 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (212) 460-4600
Consolidated Edison Company of New York, Inc.
(Exact name of registrant as specified in its charter)
| New York | 1-1217 | 13-5009340 | ||
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
| 4 Irving Place, New York, New York | 10003 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (212) 460-4600
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:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 2.02 | Results of Operations and Financial Condition. |
On August 7, 2014, Consolidated Edison, Inc. issued a press release reporting, among other things, its results of operations for the three months ended June 30, 2014. The press release is “furnished” as an exhibit to this report pursuant to Item 2.02 of Form 8-K.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit 99 | Press release, dated August 7, 2014, furnished pursuant to Item 2.02 of Form 8-K. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, each registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CONSOLIDATED EDISON, INC. | ||
| CONSOLIDATED EDISON COMPANY OF NEW YORK, INC. | ||
| By | /s/ Robert Muccilo | |
| Robert Muccilo | ||
| Vice President and Controller | ||
Date: August 8, 2014
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Exhibit 99
|
Media Relations 212 460 4111 (24 hours) |
Consolidated Edison, Inc. 4 Irving Place New York, NY 10003 www.conEdison.com |
| FOR IMMEDIATE RELEASE | Contact: | Robert McGee | ||
| August 7, 2014 | 212-460-4111 |
CON EDISON REPORTS 2014 SECOND QUARTER EARNINGS
NEW YORK - Consolidated Edison, Inc. (Con Edison) [NYSE: ED] today reported 2014 second quarter net income for common stock of $212 million or $0.73 a share compared with $172 million or $0.59 a share in 2013. Earnings from ongoing operations, which exclude the effects of the gain on sale of solar energy projects, the lease in/lease out (LILO) transactions and the net mark-to-market effects of the competitive energy businesses (CEBs), were $189 million or $0.65 a share in 2014 compared with $160 million or $0.55 a share in 2013.
For the first six months of 2014, net income for common stock was $574 million or $1.96 a share compared with $364 million or $1.24 a share in the first six months of 2013. Earnings from ongoing operations, which exclude the effects of the gain on sale of solar energy projects, the LILO transactions and the net mark-to-market effects of the CEBs, were $532 million or $1.82 a share in 2014 compared with $476 million or $1.62 a share in 2013.
“We continued to meet financial expectations in the second quarter, while our field operations benefited from a mild spring as we prepared our delivery systems for summer,” said John McAvoy, Con Edison’s chairman, president and CEO. “Our cost management strategies are helping to maximize productivity and efficiency. We’re also proud of the success of our sustainability strategy, which has yielded environmental dividends and national recognition, including a 43 percent reduction in greenhouse gas emissions since 2005 and Newsweek naming us the top U.S. utility in their 2014 Green Rankings.”
The following table is a reconciliation of Con Edison’s reported earnings per share to earnings per share from ongoing operations and reported net income to earnings from ongoing operations for the three and six months ended June 30, 2014 and 2013.
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||||||
| Earnings per Share |
Net Income for Common Stock (Millions of Dollars) |
Earnings per Share |
Net Income for Common Stock (Millions of Dollars) |
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| 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | |||||||||||||||||||||||||
| Reported earnings per share and net income for common stock– GAAP basis (basic) |
$ | 0.73 | $ | 0.59 | $ | 212 | $ | 172 | $ | 1.96 | $ | 1.24 | $ | 574 | $ | 364 | ||||||||||||||||
| Less: Gain on sale of solar energy projects (a) |
0.09 | — | 26 | — | 0.09 | — | 26 | — | ||||||||||||||||||||||||
| Add: LILO transactions (b) |
— | (0.10 | ) | — | (29 | ) | (0.02 | ) | 0.41 | (7 | ) | 121 | ||||||||||||||||||||
| Less: Net mark-to-market effects of the CEBs (c) |
(0.01 | ) | (0.06 | ) | (3 | ) | (17 | ) | 0.03 | 0.03 | 9 | 9 | ||||||||||||||||||||
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| Earnings from ongoing operations – non-GAAP |
$ | 0.65 | $ | 0.55 | $ | 189 | $ | 160 | $ | 1.82 | $ | 1.62 | $ | 532 | $ | 476 | ||||||||||||||||
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| (a) | After taxes of $19 million for the three and six months ended June 30, 2014. |
| (b) | In January 2013, a court disallowed tax losses claimed by Con Edison relating to the 1997 and 1999 LILO transactions. For the six months ended June 30, 2014 and 2013, the impact of the LILO transactions on earnings were a $7 million (after taxes of $6 million) benefit and a $121 million (after taxes of $80 million) charge, respectively, reflecting the recalculation of the accounting effect of the LILO transactions and interest on the tax liability. For the three months ended June 30, 2013, the impact of the LILO transactions on earnings was $29 million (after taxes of $22 million) benefit, reflecting the termination of the 1999 LILO transaction. |
| (c) | After taxes of $(2) million and $(13) million for the three months ended June 30, 2014 and 2013 and $6 million and $6 million for the six months ended June 30, 2014 and 2013, respectively. |
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| CON EDISON REPORTS 2014 SECOND QUARTER EARNINGS | page 2 |
The company expects its earnings from ongoing operations for the year 2014 to be in the range of $3.70 to $3.85 a share. The company’s previous forecast of 2014 earnings was in the range of $3.65 to $3.85 a share. Earnings per share from ongoing operations exclude a $0.09 a share gain on sale of solar energy projects, a $0.02 a share benefit relating to the LILO transactions and the net mark-to-market effects of the CEBs.
The results of operations for the three and six months ended June 30, 2014, as compared to the 2013 periods, reflect primarily changes in rate plans of Con Edison’s utility subsidiaries and the weather impact on its steam delivery service. The rate plans provide for revenues to cover expected increases in certain operations and maintenance expenses, and depreciation and property taxes, reflecting primarily the impact of higher utility plant balances. The results of operations also include the gain on sale of solar energy projects, the impact of the LILO transactions and the net mark-to-market effects of the CEBs.
Operations and maintenance expenses for CECONY were higher in the 2014 periods primarily due to operating costs attributable to emergency response and the support and protection of company underground facilities to accommodate municipal projects and, in the six month period were offset in part by lower pension costs.
The following table presents the estimated effect on earnings per share and net income for common stock for the three and six months ended June 30, 2014, as compared with the 2013 periods, resulting from these and other major factors:
| Three Months Ended Variation 2014 vs. 2013 |
Six Months Ended Variation 2014 vs. 2013 |
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| Earnings per Share Variation |
Net Income for Common Stock Variation (Millions of Dollars) |
Earnings per Share Variation |
Net Income for Common Stock Variation (Millions of Dollars) |
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| CECONY (a) |
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| Rate plans |
$ | 0.16 | $ | 45 | $ | 0.32 | $ | 93 | ||||||||
| Weather impact on steam revenues |
— | — | 0.04 | 13 | ||||||||||||
| Operations and maintenance expense |
(0.05 | ) | (14 | ) | (0.02 | ) | (4 | ) | ||||||||
| Depreciation and property taxes |
(0.05 | ) | (13 | ) | (0.09 | ) | (28 | ) | ||||||||
| Other |
— | 1 | 0.01 | 2 | ||||||||||||
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| Total CECONY |
0.06 | 19 | 0.26 | 76 | ||||||||||||
| Orange and Rockland Utilities (O&R) (a) |
0.01 | 2 | (0.02 | ) | (7 | ) | ||||||||||
| CEBs (b) |
0.06 | 16 | 0.46 | 137 | ||||||||||||
| Other, including parent company expenses |
0.01 | 3 | 0.02 | 4 | ||||||||||||
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| Total variation |
$ | 0.14 | $ | 40 | $ | 0.72 | $ | 210 | ||||||||
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| (a) | Under the revenue decoupling mechanisms in CECONY’s and O&R’s New York electric and gas rate plans and the weather-normalization clause applicable to their gas businesses, revenues are generally not affected by changes in delivery volumes from levels assumed when rates were approved. Under the rate plans, pension and other postretirement costs and certain other costs are reconciled to amounts reflected in rates for such costs. |
| (b) | These variations include the gain on sale of solar energy projects, the impact of the LILO transactions and the net mark-to-market effects shown in the table on page 1. In addition, the variations include a tax benefit in the six months ended June 30, 2013 of $15 million or $0.05 a share resulting from the acceptance by the Internal Revenue Service of the company’s claim for manufacturing tax deductions. |
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| CON EDISON REPORTS 2014 SECOND QUARTER EARNINGS | page 3 |
Refer to the company’s Second Quarter Form 10-Q, which is being filed with the Securities and Exchange Commission, for the consolidated balance sheets at June 30, 2014 and December 31, 2013 and the consolidated income statements for the three and six months ended June 30, 2014 and 2013. Additional information related to utility sales and revenues is available at www.conedison.com (select “Shareholder Services” and then select “Press Releases”).
This press release contains forward-looking statements that reflect expectations and not facts. Actual results may differ materially from those expectations because of factors such as those identified in reports the company has filed with the Securities and Exchange Commission.
This press release also contains a financial measure, earnings from ongoing operations. This non-GAAP measure should not be considered as an alternative to net income, which is an indicator of operating performance determined in accordance with GAAP. Management uses this non-GAAP measure to facilitate the analysis of the company’s ongoing performance as compared to its internal budgets and previously reported financial results. Management believes that this non-GAAP measure also is useful and meaningful to investors.
Consolidated Edison, Inc. is one of the nation’s largest investor-owned energy companies, with approximately $12 billion in annual revenues and $40 billion in assets. The company provides a wide range of energy-related products and services to its customers through the following subsidiaries: Consolidated Edison Company of New York, Inc., a regulated utility providing electric, gas, and steam service in New York City and Westchester County, New York; Orange and Rockland Utilities, Inc., a regulated utility serving customers in a 1,350 square mile area in southeastern New York state and adjacent sections of northern New Jersey and northeastern Pennsylvania; Consolidated Edison Solutions, Inc., a retail energy supply and services company; Consolidated Edison Energy, Inc., a wholesale energy services company; and Consolidated Edison Development, Inc., a company that participates in energy infrastructure projects.
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