Exhibit 99.1
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| Feb. 1, 2006 | | MEDIA CONTACT: | | Randy Wheeless |
| | | Phone: | | 704/382-8379 |
| | | 24-Hour: | | 704/382-8333 |
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| | | ANALYST CONTACT: | | Julie Dill |
| | | Phone: | | 980/373-4332 |
Duke Energy Reports Year-End and Fourth Quarter 2005 Results
| | • | | 2005 ongoing basic earnings per share of $1.79 versus $1.51 in 2004 |
| | • | | Reported 2005 basic earnings per share of $1.94 versus $1.59 in 2004 |
| | • | | All major business units performed well; increased commodity prices and real estate operations among top drivers in 2005 |
| | • | | Ongoing basic fourth quarter earnings of 43 cents versus 29 cents in last year’s quarter; reported fourth quarter basic earnings of 65 cents versus 38 cents in last year’s quarter |
| | • | | Incentive target of $1.90 per ongoing diluted share for 2006 reflects a 10 percent increase over 2005 earnings of $1.73 per ongoing diluted share |
CHARLOTTE, N.C. – Duke Energy today reported 2005 basic earnings per share (EPS) of $1.94, or $1.82 billion in net income, compared to $1.59 per share in 2004, or $1.49 billion in net income. On a diluted basis, 2005 EPS was $1.88, compared to $1.54 in 2004.
Ongoing basic EPS for 2005, which excludes special items and discontinued operations (with the exception of Crescent Resources), was $1.79 versus $1.51 in 2004. On a diluted basis, ongoing EPS for 2005 was $1.73, compared to $1.46 in 2004.
“In 2005, Duke Energy took a number of significant strategic steps to shape our future, but at the same time stayed focused on the tasks at hand to deliver outstanding results for the year,” said Paul Anderson, chairman of the board and chief executive officer. “I’m very proud that our employees were able to surpass their earnings targets at the same time they were creating the foundation for the organization that will become the ‘new’ Duke Energy.
“Our major businesses contributed to the improved results in 2005. I expect the company to continue on a positive trajectory with an equally strong performance in 2006,” Anderson said.
Anderson noted that Duke Energy’s 2006 employee incentive earnings target has been set at $1.90 per ongoing diluted share – 10 percent higher than the $1.73 per ongoing diluted share achieved in 2005. The minimum employee incentive threshold for 2006 has been set at $1.75 per ongoing diluted share – still higher than this year’s results.
In fourth quarter 2005, Duke Energy reported basic earnings of $0.65 per share, or $606 million in net income, compared to $0.38 per share, or $358 million in fourth quarter 2004. Diluted earnings per share for the quarter were $0.63, compared to $0.36 in the previous year’s quarter. Excluding special items and discontinued operations (with the exception of Crescent Resources), ongoing basic earnings per share for fourth quarter 2005 were $0.43 versus $0.29 in fourth quarter 2004.
Special items impacting basic EPS for the quarter include:
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(In millions, except per share amounts)
| | Pre-Tax
Amount
| | | Tax
Effect
| | | 4Q 2005 EPS
Impact
| | | 4Q 2004
EPS
Impact
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Fourth quarter 2005 | |
• Loss on Southeast DENA contract termination | | $ | (75 | ) | | $ | 28 | | | $ | (0.05 | ) | | | | |
• Mark-to-market loss on de-designated Southeast DENA hedges | | $ | (9 | ) | | $ | 3 | | | $ | (0.01 | ) | | | | |
• Settlement of positions on 2005 Field Services’ hedges that were de-designated | | $ | 35 | | | $ | (13 | ) | | $ | 0.02 | | | | | |
• Mark-to-market gain on de-designated 2005 Field Services’ hedges | | $ | 64 | | | $ | (22 | ) | | $ | 0.05 | | | | | |
• Tax adjustments | | | — | | | $ | 12 | | | $ | 0.01 | | | | | |
Fourth quarter 2004 | | | | | | | | | | | | | | | | |
• Net loss on asset sales, net of minority interest of $20 million | | $ | (29 | ) | | $ | 10 | | | | | | | $ | (0.02 | ) |
• Adjustment to captive insurance reserves | | $ | 64 | | | $ | (22 | ) | | | | | | $ | 0.04 | |
• Net gain on sales of equity investments | | $ | 10 | | | $ | (3 | ) | | | | | | $ | 0.01 | |
• Loss on asset exchanges | | $ | (4 | ) | | $ | 1 | | | | | | | | — | |
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Total basic EPS impact | | | | | | | | | | $ | 0.02 | | | $ | 0.03 | |
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Reconciliation of reported to ongoing basic EPS for the quarter:
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| | | 4Q 2005 EPS
| | | 4Q 2004 EPS
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Basic EPS from continuing operations, as reported | | $ | 0.45 | | | $ | 0.32 | |
Basic EPS from discontinued operations, as reported | | $ | 0.20 | | | $ | 0.06 | |
Basic EPS, as reported | | $ | 0.65 | | | $ | 0.38 | |
Adjustments to reported EPS: | | | | | | | | |
• Basic EPS from discontinued operations excluding Crescent Resources, and cumulative effect of change in accounting principle | | $ | (0.20 | ) | | $ | (0.06 | ) |
• Basic EPS impact of special items | | $ | (0.02 | ) | | $ | (0.03 | ) |
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Basic EPS, ongoing | | $ | 0.43 | | | $ | 0.29 | |
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Reconciliation of reported to ongoing EPS for the annual period:
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| | | 2005 Basic
EPS
| | | 2004 Basic
EPS
| | | 2005 Diluted
EPS
| | | 2004 Diluted
EPS
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EPS from continuing operations, as reported | | $ | 2.69 | | | $ | 1.33 | | | $ | 2.61 | | | $ | 1.29 | |
EPS from discontinued operations, as reported | | $ | (0.75 | ) | | $ | 0.26 | | | $ | (0.73 | ) | | $ | 0.25 | |
EPS, as reported | | $ | 1.94 | | | $ | 1.59 | | | $ | 1.88 | | | $ | 1.54 | |
Adjustments to reported EPS: | | | | | | | | | | | | | | | | |
• EPS from discontinued operations excluding Crescent Resources, and cumulative effect of change in accounting principle | | $ | 0.76 | | | $ | (0.25 | ) | | $ | 0.73 | | | $ | (0.24 | ) |
• EPS impact of special items | | $ | (0.91 | ) | | $ | 0.17 | | | $ | (0.88 | ) | | $ | 0.16 | |
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EPS, ongoing | | $ | 1.79 | | | $ | 1.51 | | | $ | 1.73 | | | $ | 1.46 | |
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BUSINESS UNIT RESULTS
Franchised Electric
Fourth quarter 2005 segment EBIT from continuing operations for Franchised Electric was $279 million, compared to $252 million in the prior year’s quarter. The increase was driven primarily by favorable weather, which pushed residential sales up almost 14 percent, and strong bulk power marketing results.
The increase in segment EBIT was partially offset by the $46 million charge related to the estimated expenses from the December 2005 ice storm and higher operating and maintenance expenses. The storm caused the second largest number of outages in Franchised Electric’s history – about 700,000 customers.
Overall, kilowatt-hour sales were up more than 6 percent for the quarter. Industrial sales were basically flat due to the decline in textile sales offsetting other industrial growth. Regional growth continued to add to Franchised Electric’s total customer base, with 43,000 customers – about 2 percent – being added during the past year.
Year-end segment EBIT from continuing operations for Franchised Electric was approximately $1.50 billion in 2005, compared to $1.47 billion in 2004.
Natural Gas Transmission
Duke Energy Gas Transmission (DEGT) reported fourth quarter 2005 segment EBIT from continuing operations of $344 million, compared to $343 million in fourth quarter 2004.
The fourth quarter was helped by U.S. expansion projects and favorable earnings in Canada, including continued benefits from the stronger Canadian currency over comparable periods. These were offset by the absence of $15 million in gains on asset sales in the previous year.
The favorable Canadian currency impacts on DEGT’s EBIT were partially offset in Duke Energy’s net income by currency impacts on Canadian interest and taxes.
In December 2005, Duke Energy Income Fund, a Canadian income trust, was created to acquire an interest of DEGT’s Canadian midstream processing assets. Proceeds to DEGT as a result of the sale were about $110 million in December 2005, and additional proceeds of approximately $11 million were received in January 2006, when more interests were sold. DEGT retains an ownership interest of 58 percent in these midstream assets.
Year-end 2005 segment EBIT for DEGT was approximately $1.39 billion versus $1.33 billion in 2004.
Field Services
The Field Services business segment, which represents Duke Energy’s 50 percent interest in Duke Energy Field Services (DEFS), reported fourth quarter 2005 equity earnings of $162 million, compared to $124 million of segment EBIT from continuing operations in fourth quarter 2004.
Results were primarily driven by strong commodity prices and gas marketing results. These were partly offset by higher operating costs from asset integrity work and the absence of earnings from TEPPCO GP and Duke Energy’s lower ownership share in DEFS (50 percent versus approximately 70 percent previously) from the earlier year’s quarter.
The equity earnings amount does not include the positive $22 million impact of hedge mark-to-market movement on 2005 contracts during the quarter, which are reported in Other. All hedge impacts were reported in Field Services’ segment EBIT during fourth quarter 2004.
During the quarter, DEFS paid dividends and tax distributions, of which Duke Energy’s portion was $362 million. This payment reflects continued strong cash flow and earnings at DEFS.
In December 2005, DEFS formed DCP Midstream Partners LP (DCP Midstream), a midstream energy master limited partnership (MLP). DEFS is the general partner for DCP Midstream and has a 42 percent interest in the MLP, with the remaining 58 percent publicly owned. On Dec. 7, 2005, DCP Midstream closed its initial public offering of 10.35 million common units at $21.50 per unit. Total proceeds received by DCP Midstream, net of underwriting discount, from the sale of the units were approximately $208 million.
International Energy
For fourth quarter 2005, Duke Energy International (DEI) reported segment EBIT from continuing operations of $97 million, compared to $61 million in fourth quarter 2004.
Results were driven by favorable pricing and hydrological conditions in Latin America – partially offset by increased operating costs – higher margins at National Methanol and favorable currency impacts in Brazil. The favorable currency impacts on DEI’s EBIT were partially offset in Duke Energy’s net income by currency impacts on Brazilian interest and taxes.
Year-end segment EBIT from continuing operations for DEI was $314 million versus $222 million in 2004.
Crescent Resources
Crescent Resources reported fourth quarter 2005 segment EBIT from continuing operations of $104 million, compared to $50 million in the previous year’s quarter.
Segment EBIT was primarily driven by higher income from residential and multi-family projects and the absence of $38 million of impairment and other charges, net of minority interest of $12 million, recorded in the previous year.
Year-end segment EBIT from continuing operations for Crescent Resources was $314 million, compared to $240 million in 2004.
Other
Other primarily includes the cost of corporate governance, Duke Energy’s captive insurance company, Bison Insurance Co. Limited, de-designated hedges resulting from the decision to transfer a 19.7 percent interest in DEFS to ConocoPhillips and DENA’s continuing operations for 2005. Other reported an EBIT loss from continuing operations of $150 million in fourth quarter 2005, compared to a loss of $21 million in fourth quarter 2004.
Increased losses for Other were largely attributable to continuing operations at DENA, which were not included in Other in the prior period. DENA’s ongoing operations reported a loss of about $120 million during fourth quarter 2005, which includes approximately $84 million in special items primarily for contract terminations.
Year-end EBIT loss from continuing operations for Other was $645 million, compared with a $77 million EBIT loss in 2004.
Discontinued Operations
In the fourth quarter 2005, Discontinued Operations earned $189 million, compared to $55 million in fourth quarter 2004. The variance is primarily due to the gain on the disposition of DENA assets recorded during fourth quarter 2005.
Year-end, Discontinued Operations showed a loss of $705 million, compared with earnings of $238 million in 2004.
INTEREST EXPENSE
Interest expense was $249 million for fourth quarter 2005, compared to $297 million for fourth quarter 2004 primarily due to the deconsolidation of DEFS on July 1, 2005.
For 2005, interest expense was about $1.06 billion, compared to $1.28 billion in 2004.
INCOME TAX
Fourth quarter 2005 income tax expenses from continuing operations were $188 million, compared to $168 million in fourth quarter 2004. The effective tax rate in fourth quarter 2005 was 30.9 percent, compared to 35.7 percent during fourth quarter 2004. The decrease in the effective tax rate was due primarily to the $45 million tax expense recognized during fourth quarter 2004 related to the repatriation of foreign earnings under the American Jobs Creation Act of 2004. This was offset slightly by 2005 income tax adjustments related to prior periods.
Year-end income tax expenses from continuing operations were about $1.28 billion, compared to $533 million in 2004.
LIQUIDITY AND CAPITAL RESOURCES
Duke Energy’s consolidated capital structure as of Dec. 31, 2005, including short-term debt, was 48 percent debt, 50 percent common equity and 2 percent minority interests. The company had approximately $1.05 billion in cash, cash equivalents and short-term investments as of Dec. 31, 2005.
ADDITIONAL INFORMATION
Additional information, about EPS reconciliation data can be obtained at Duke Energy’s fourth quarter 2005 earnings information Web site at:www.duke-energy.com/investors/.
NON-GAAP FINANCIAL MEASURES
The primary performance measure used by management to evaluate segment performance is segment EBIT from continuing operations, which at the segment level represents all profits from continuing operations (both operating and non-operating), including any equity in earnings of unconsolidated affiliates, before deducting interest and taxes, and is net of the minority interest expense related to those profits. Management believes segment EBIT from continuing operations, which is the GAAP measure used to report segment results, is a good indicator of each segment’s operating performance as it represents the results of our ownership interests in continuing operations without regard to financing methods or capital structures.
Duke Energy’s management uses ongoing basic and diluted EPS, which are non-GAAP financial measures as they represent basic and diluted EPS from continuing operations plus any discontinued operations from its Crescent Resources real estate unit, adjusted for the impact of special items, as two of the measures to evaluate operations of the company. Special items represent certain charges and credits which management believes will not be recurring on a regular basis. Management believes that the presentation of ongoing basic and diluted EPS provides useful information to investors, as it allows them to more accurately compare the company’s ongoing performance across periods. Ongoing basic EPS was used as the basis for employee incentive bonuses in 2005. In 2006, ongoing diluted EPS will be used as the basis for employee incentive bonuses. The most directly comparable GAAP measures for ongoing basic and diluted EPS are reported basic and diluted EPS from continuing operations, respectively, which include the impact of special items. Due to the forward-looking nature of ongoing basic and diluted EPS for future periods, information to reconcile such non-GAAP financial measures to the most directly comparable GAAP financial measure is not available at this time as the company is unable to forecast any special items for future periods.
Duke Energy is a diversified energy company with a portfolio of natural gas and electric businesses, both regulated and unregulated, and an affiliated real estate company. Duke Energy supplies, delivers and processes energy for customers in the Americas. Headquartered in Charlotte, N.C., Duke Energy is a Fortune 500 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available on the Internet at:www.duke-energy.com.
An earnings conference call for analysts is scheduled for 10 a.m. ET today. The conference call can be accessed via theinvestors’ section of Duke Energy’s Web sitewww.duke-energy.com/investors/ or by dialing 800/500-0311 in the United States or 719/457-2698 outside the United States. The confirmation code is 6097495. Please call in five to 10 minutes prior to the scheduled start time. A replay of the conference call will be available until midnight ET, Feb. 10, 2006, by dialing
888/203-1112 with a confirmation code of 6097495. The international replay number is 719/457-0820, confirmation code 6097495. A replay and transcript also will be available by accessing theinvestors’ section of the company’s Web site. The presentation may include certain non-GAAP financial measures as defined under SEC rules. In such event, a reconciliation of those measures to the most directly comparable GAAP measures will be available on our investor relations Web site at:www.duke-energy.com/investors/publications/gaap/.
This release includes statements that do not directly or exclusively relate to historical facts. Such statements are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Those statements represent Duke Energy’s intentions, plans, expectations, assumptions and beliefs about future events and are subject to risks, uncertainties and other factors, many of which are outside Duke Energy’s control and could cause actual results to differ materially from the results expressed or implied by those forward-looking statements. Those factors include: state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an impact on rate structures, and affect the speed at and degree to which competition enters the electric and natural gas industries; the outcomes of litigation and regulatory investigations, proceedings or inquiries; industrial, commercial and residential growth in Duke Energy’s service territories; the influence of weather and other natural phenomena on company operations, including the economic, operational and other effects of Hurricanes Katrina and Rita; the timing and extent of changes in commodity prices, interest rates and foreign currency exchange rates; general economic conditions, including any potential effects arising from terrorist attacks and any consequential hostilities or other hostilities or other external factors over which Duke Energy has no control; changes in environmental and other laws and regulations to which Duke Energy and its subsidiaries are subject; the results of financing efforts, including Duke Energy’s ability to obtain financing on favorable terms, which can be affected by various factors, including Duke Energy’s credit ratings and general economic conditions; declines in the market prices of equity securities and resultant cash funding requirements for Duke
Energy’s defined benefit pension plans; the level of creditworthiness of counterparties to Duke Energy’s transactions; the amount of collateral required to be posted from time to time in Duke Energy’s transactions; opportunities for Duke Energy’s business units, including the timing and success of efforts to develop domestic and international power, pipeline, gathering, liquefied natural gas, processing and other infrastructure projects; competition and regulatory limitations affecting the success of Duke Energy’s divestiture plans, including the prices at which Duke Energy is able to sell its assets; the performance of electric generation, pipeline and gas processing facilities; the extent of success in connecting natural gas supplies to gathering and processing systems and in connecting and expanding gas and electric markets; the effect of accounting pronouncements issued periodically by accounting standard-setting bodies; conditions of the capital markets and equity markets during the periods covered by the forward-looking statements; the ability to successfully complete merger, acquisition or divestiture plans (including the merger with Cinergy Corp.); regulatory or other limitations imposed as a result of a merger, acquisition or divestiture; and the success of the business following a merger, acquisition or divestiture.
In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than Duke Energy has described. Duke Energy undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Information contained in this release is unaudited, and is subject to change.
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DECEMBER 2005
QUARTERLY HIGHLIGHTS
(Unaudited)
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| | | Three Months Ended December 31,
| | | Twelve Months Ended December 31,
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(In millions, except per share amounts and where noted)
| | 2005
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COMMON STOCK DATA | | | | | | | | | | | | | | | | |
Earnings Per Share (from continuing operations) | | | | | | | | | | | | | | | | |
Basic | | $ | 0.45 | | | $ | 0.32 | | | $ | 2.69 | | | $ | 1.33 | |
Diluted | | $ | 0.43 | | | $ | 0.30 | | | $ | 2.61 | | | $ | 1.29 | |
Earnings (Loss) Per Share (from discontinued operations) | | | | | | | | | | | | | | | | |
Basic | | $ | 0.20 | | | $ | 0.06 | | | $ | (0.75 | ) | | $ | 0.26 | |
Diluted | | $ | 0.20 | | | $ | 0.06 | | | $ | (0.73 | ) | | $ | 0.25 | |
Earnings Per Share (before cumulative effect of change in accounting principle) | | | | | | | | | | | | | | | | |
Basic | | $ | 0.65 | | | $ | 0.38 | | | $ | 1.94 | | | $ | 1.59 | |
Diluted | | $ | 0.63 | | | $ | 0.36 | | | $ | 1.88 | | | $ | 1.54 | |
Earnings Per Share | | | | | | | | | | | | | | | | |
Basic | | $ | 0.65 | | | $ | 0.38 | | | $ | 1.94 | | | $ | 1.59 | |
Diluted | | $ | 0.63 | | | $ | 0.36 | | | $ | 1.88 | | | $ | 1.54 | |
Dividends Per Share | | $ | 0.31 | | | $ | 0.275 | | | $ | 1.17 | | | $ | 1.10 | |
Weighted-Average Shares Outstanding | | | | | | | | | | | | | | | | |
Basic | | | 928 | | | | 947 | | | | 934 | | | | 931 | |
Diluted | | | 962 | | | | 983 | | | | 970 | | | | 966 | |
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INCOME | | | | | | | | | | | | | | | | |
Operating Revenues | | $ | 3,116 | | | $ | 5,542 | | | $ | 16,746 | | | $ | 20,549 | |
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Total Reportable Segment EBIT | | | 986 | | | | 759 | | | | 5,457 | | | | 3,040 | |
Other EBIT | | | (150 | ) | | | (21 | ) | | | (645 | ) | | | (77 | ) |
Interest Expense | | | 249 | | | | 297 | | | | 1,062 | | | | 1,281 | |
Interest Income and Other (a) | | | (22 | ) | | | (30 | ) | | | (66 | ) | | | (103 | ) |
Income Tax Expense from Continuing Operations | | | 188 | | | | 168 | | | | 1,283 | | | | 533 | |
Income (Loss) from Discontinued Operations | | | 189 | | | | 55 | | | | (705 | ) | | | 238 | |
Cumulative Effect of Change in Accounting Principle, net of tax | | | (4 | ) | | | — | | | | (4 | ) | | | — | |
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Net Income | | | 606 | | | | 358 | | | | 1,824 | | | | 1,490 | |
Dividends and Premiums on Redemption of Preferred and Preference Stock | | | 5 | | | | 2 | | | | 12 | | | | 9 | |
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Earnings Available for Common Stockholders | | $ | 601 | | | $ | 356 | | | $ | 1,812 | | | $ | 1,481 | |
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CAPITALIZATION | | | | | | | | | | | | | | | | |
Common Equity | | | | | | | | | | | 50 | % | | | 45 | % |
Preferred Stock | | | | | | | | | | | 0 | % | | | 0 | % |
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Total Common Equity and Preferred Securities | | | | | | | | | | | 50 | % | | | 45 | % |
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Minority Interests | | | | | | | | | | | 2 | % | | | 4 | % |
Total Debt | | | | | | | | | | | 48 | % | | | 51 | % |
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Total Debt | | | | | | | | | | $ | 16,030 | | | $ | 18,832 | |
Book Value Per Share | | | | | | | | | | $ | 17.72 | | | $ | 17.18 | |
Actual Shares Outstanding | | | | | | | | | | | 928 | | | | 957 | |
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CAPITAL AND INVESTMENT EXPENDITURES | | | | | | | | | | | | | | | | |
Franchised Electric | | $ | 419 | | | $ | 336 | | | $ | 1,332 | | | $ | 1,117 | |
Natural Gas Transmission | | | 214 | | | | 146 | | | | 930 | | | | 544 | |
Field Services | | | — | | | | 50 | | | | 86 | | | | 202 | |
Duke Energy North America | | | — | | | | 3 | | | | 4 | | | | 22 | |
International Energy | | | 3 | | | | 4 | | | | 23 | | | | 28 | |
Crescent (b) | | | 129 | | | | 162 | | | | 599 | | | | 568 | |
Other | | | 18 | | | | 15 | | | | 27 | | | | 39 | |
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Total Capital and Investment Expenditures | | $ | 783 | | | $ | 716 | | | $ | 3,001 | | | $ | 2,520 | |
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EBIT BY BUSINESS SEGMENT | | | | | | | | | | | | | | | | |
Franchised Electric | | $ | 279 | | | $ | 252 | | | $ | 1,495 | | | $ | 1,467 | |
Natural Gas Transmission | | | 344 | | | | 343 | | | | 1,388 | | | | 1,329 | |
Field Services | | | 162 | | | | 124 | | | | 1,946 | | | | 367 | |
Duke Energy North America | | | — | | | | (71 | ) | | | — | | | | (585 | ) |
International Energy | | | 97 | | | | 61 | | | | 314 | | | | 222 | |
Crescent | | | 104 | | | | 50 | | | | 314 | | | | 240 | |
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Total reportable segment EBIT | | | 986 | | | | 759 | | | | 5,457 | | | | 3,040 | |
Other EBIT | | | (150 | ) | | | (21 | ) | | | (645 | ) | | | (77 | ) |
Interest expense | | | (249 | ) | | | (297 | ) | | | (1,062 | ) | | | (1,281 | ) |
Interest Income and Other (a) | | | 22 | | | | 30 | | | | 66 | | | | 103 | |
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Consolidated earnings from continuing operations before income taxes | | $ | 609 | | | $ | 471 | | | $ | 3,816 | | | $ | 1,785 | |
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| (a) | Other includes foreign currency transaction gains and losses and additional minority interest not allocated to the segment results. |
| (b) | Amounts include capital expenditures for residential real estate included in operating cash flows of $79 million and $104 million for the three months ended December 31, 2005 and 2004 respectively, and $355 million and $322 million for the twelve months ended December 31, 2005 and 2004, respectively. |
Note: Certain prior period amounts have been reclassified due to discontinued operations.
DECEMBER 2005
QUARTERLY HIGHLIGHTS
(Unaudited)
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| | | Three Months Ended
December 31,
| | | Twelve Months Ended
December 31,
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(In millions, except where noted)
| | 2005
| | | 2004
| | | 2005
| | | 2004
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FRANCHISED ELECTRIC | | | | | | | | | | | | | | | | |
Operating Revenues | | $ | 1,314 | | | $ | 1,151 | | | $ | 5,432 | | | $ | 5,069 | |
Operating Expenses | | | 1,043 | | | | 899 | | | | 3,959 | | | | 3,613 | |
Gains on Sales of Other Assets, net | | | 5 | | | | — | | | | 7 | | | | 3 | |
Other Income, net of expenses | | | 3 | | | | — | | | | 15 | | | | 8 | |
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EBIT | | $ | 279 | | | $ | 252 | | | $ | 1,495 | | | $ | 1,467 | |
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Sales, GWh | | | 19,959 | | | | 18,754 | | | | 85,277 | | | | 82,708 | |
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NATURAL GAS TRANSMISSION | | | | | | | | | | | | | | | | |
Operating Revenues | | $ | 1,231 | | | $ | 943 | | | $ | 4,055 | | | $ | 3,351 | |
Operating Expenses | | | 906 | | | | 622 | | | | 2,715 | | | | 2,075 | |
Gains on Sales of Other Assets, net | | | 9 | | | | 5 | | | | 13 | | | | 17 | |
Other Income, net of expenses | | | 17 | | | | 24 | | | | 65 | | | | 63 | |
Minority Interest Expense | | | 7 | | | | 7 | | | | 30 | | | | 27 | |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
EBIT | | $ | 344 | | | $ | 343 | | | $ | 1,388 | | | $ | 1,329 | |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
Proportional Throughput, TBtu | | | 876 | | | | 865 | | | | 3,410 | | | | 3,332 | |
| | | | |
FIELD SERVICES(a) | | | | | | | | | | | | | | | | |
Operating Revenues | | $ | — | | | $ | 2,890 | | | $ | 5,530 | | | $ | 10,044 | |
Operating Expenses | | | 4 | | | | 2,704 | | | | 5,215 | | | | 9,489 | |
Gains on Sales of Other Assets, net | | | — | | | | 1 | | | | 577 | | | | 2 | |
Equity in Earnings of Unconsolidated Affiliates (b) | | | 166 | | | | — | | | | 292 | | | | — | |
Other Income, net of expenses | | | — | | | | 20 | | | | 1,259 | | | | 37 | |
Minority Interest Expense | | | — | | | | 83 | | | | 497 | | | | 227 | |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
EBIT | | $ | 162 | | | $ | 124 | | | $ | 1,946 | | | $ | 367 | |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
Natural Gas Gathered and Processed/Transported, TBtu/day (c) | | | 6.9 | | | | 6.8 | | | | 6.8 | | | | 6.8 | |
Natural Gas Liquids Production, MBbl/d (c) | | | 344 | | | | 362 | | | | 351 | | | | 356 | |
Average Natural Gas Price per MMBtu | | $ | 12.97 | | | $ | 7.11 | | | $ | 8.59 | | | $ | 6.14 | |
Average Natural Gas Liquids Price per Gallon | | $ | 1.00 | | | $ | 0.80 | | | $ | 0.85 | | | $ | 0.68 | |
| | | | |
DUKE ENERGY NORTH AMERICA(a) (e) | | | | | | | | | | | | | | | | |
Operating Revenues | | $ | — | | | $ | 4 | | | $ | — | | | $ | 173 | |
Operating Expenses | | | — | | | | 50 | | | | — | | | | 368 | |
Losses on Sales of Other Assets, net (d) | | | — | | | | (54 | ) | | | — | | | | (427 | ) |
Other Income, net of expenses | | | — | | | | 6 | | | | — | | | | 12 | |
Minority Interest Benefit | | | — | | | | (23 | ) | | | — | | | | (25 | ) |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
EBIT | | $ | — | | | $ | (71 | ) | | $ | — | | | $ | (585 | ) |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
Actual Plant Production, GWh (DENA Continuing Operations) | | | | | | | | | | | | | | | 3,343 | |
Proportional MW Capacity in Operation (DENA Continuing Operations) | | | | | | | | | | | | | | | 3,600 | |
| | | | |
INTERNATIONAL ENERGY | | | | | | | | | | | | | | | | |
Operating Revenues | | $ | 209 | | | $ | 172 | | | $ | 745 | | | $ | 619 | |
Operating Expenses | | | 151 | | | | 124 | | | | 536 | | | | 462 | |
Losses on Sales of Other Assets, net | | | (1 | ) | | | (4 | ) | | | — | | | | (3 | ) |
Other Income, net of expenses | | | 43 | | | | 18 | | | | 117 | | | | 78 | |
Minority Interest Expense | | | 3 | | | | 1 | | | | 12 | | | | 10 | |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
EBIT | | $ | 97 | | | $ | 61 | | | $ | 314 | | | $ | 222 | |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
Sales, GWh | | | 4,657 | | | | 4,688 | | | | 18,213 | | | | 17,776 | |
Proportional MW Capacity in Operation | | | | | | | | | | | 3,937 | | | | 4,139 | |
| | | | |
CRESCENT | | | | | | | | | | | | | | | | |
Operating Revenues | | $ | 214 | | | $ | 221 | | | $ | 495 | | | $ | 437 | |
Operating Expenses | | | 174 | | | | 220 | | | | 399 | | | | 393 | |
Gains on Sales of Investments in Commercial and Multi-Family Real Estate | | | 74 | | | | 43 | | | | 191 | | | | 192 | |
Other Income, net of expenses | | | — | | | | 3 | | | | 44 | | | | 3 | |
Minority Interest Expense (Benefit) | | | 10 | | | | (3 | ) | | | 17 | | | | (1 | ) |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
EBIT | | $ | 104 | | | $ | 50 | | | $ | 314 | | | $ | 240 | |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
| | | | |
OTHER(e) | | | | | | | | | | | | | | | | |
Operating Revenues | | $ | 190 | | | $ | 215 | | | $ | 700 | | | $ | 1,144 | |
Operating Expenses | | | 315 | | | | 243 | | | | 1,235 | | | | 1,257 | |
(Losses) Gains on Sales of Other Assets, net | | | (68 | ) | | | — | | | | (62 | ) | | | 4 | |
Other Income (Expense), net | | | 53 | | | | 7 | | | | (45 | ) | | | 32 | |
Minority Interest Expense | | | 10 | | | | — | | | | 3 | | | | — | |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
EBIT | | $ | (150 | ) | | $ | (21 | ) | | $ | (645 | ) | | $ | (77 | ) |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
|
Actual Plant Production, GWh (DENA Continuing Operations) | | | | | | | | | | | 1,759 | | | | | |
Proportional MW Capacity in Operation (DENA Continuing Operations) | | | | | | | | | | | 3,600 | | | | | |
| (a) | Certain prior year amounts have been reclassified due to discontinued operations. |
| (b) | Represents the 50% interest in Duke Energy Field Services LLC |
| (c) | Represents 100% of joint venture volumes. |
| (d) | Prior year amounts for the twelve months ended December 31, 2004 include DENA Southeast plant impairment of approximately $360 million. |
| (e) | 2005 Segment EBIT balances for DENA’s continuing operations are included in Other. |
Note: See GAAP reconciliation associated with the 2005 fourth quarter Earnings Release on the Investor Relations
Web site at http://www.duke-energy.com/investors/publications/gaap/.
DUKE ENERGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In millions, except per-share amounts)
| | | | | | | | |
| | | Years Ended
December 31,
| |
| | | 2005
| | | 2004
| |
Operating Revenues | | $ | 16,746 | | | $ | 20,549 | |
Operating Expenses | | | 13,855 | | | | 17,376 | |
Gains on Sales of Investments in Commercial and Multi-Family Real Estate | | | 191 | | | | 192 | |
Gains (Losses) on Sales of Other Assets, net | | | 534 | | | | (404 | ) |
| | |
|
|
| |
|
|
|
Operating Income | | | 3,616 | | | | 2,961 | |
| | |
|
|
| |
|
|
|
Other Income and Expenses | | | 1,800 | | | | 305 | |
Interest Expense | | | 1,062 | | | | 1,281 | |
Minority Interest Expense | | | 538 | | | | 200 | |
| | |
|
|
| |
|
|
|
Earnings From Continuing Operations Before Income Taxes | | | 3,816 | | | | 1,785 | |
Income Tax Expense from Continuing Operations | | | 1,283 | | | | 533 | |
| | |
|
|
| |
|
|
|
Income From Continuing Operations | | | 2,533 | | | | 1,252 | |
| | |
(Loss) Income From Discontinued Operations, net of tax | | | (705 | ) | | | 238 | |
| | |
|
|
| |
|
|
|
Income Before Cumulative Effect of Change in Accounting Principle | | | 1,828 | | | | 1,490 | |
Cumulative Effect of Change in Accounting Principle, net of tax | | | (4 | ) | | | — | |
| | |
|
|
| |
|
|
|
Net Income | | | 1,824 | | | | 1,490 | |
| | |
Dividends and Premiums on Redemption of Preferred and Preference Stock | | | 12 | | | | 9 | |
| | |
|
|
| |
|
|
|
Earnings Available For Common Stockholders | | $ | 1,812 | | | $ | 1,481 | |
| | |
|
|
| |
|
|
|
| Common Stock Data | | | | | | | | |
Weighted-average shares outstanding | | | | | | | | |
Basic | | | 934 | | | | 931 | |
Diluted | | | 970 | | | | 966 | |
Earnings per share (from continuing operations) | | | | | | | | |
Basic | | $ | 2.69 | | | $ | 1.33 | |
Diluted | | $ | 2.61 | | | $ | 1.29 | |
(Loss) Earnings per share (from discontinued operations) | | | | | | | | |
Basic | | $ | (0.75 | ) | | $ | 0.26 | |
Diluted | | $ | (0.73 | ) | | $ | 0.25 | |
Earnings per share (before cumulative effect of change in accounting principle) | | | | | | | | |
Basic | | $ | 1.94 | | | $ | 1.59 | |
Diluted | | $ | 1.88 | | | $ | 1.54 | |
Earnings per share | | | | | | | | |
Basic | | $ | 1.94 | | | $ | 1.59 | |
Diluted | | $ | 1.88 | | | $ | 1.54 | |
Dividends per share | | $ | 1.17 | | | $ | 1.10 | |
DUKE ENERGY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In millions)
| | | | | | |
| | | December 31,
2005
| | December 31, 2004
|
| ASSETS | | | | | | |
| | |
Current Assets | | $ | 7,817 | | $ | 7,971 |
Investments and Other Assets | | | 15,036 | | | 11,533 |
Net Property, Plant and Equipment | | | 29,200 | | | 33,806 |
Regulatory Assets and Deferred Debits | | | 2,533 | | | 2,460 |
| | |
|
| |
|
|
Total Assets | | $ | 54,586 | | $ | 55,770 |
| | |
|
| |
|
|
| LIABILITIES AND COMMON STOCKHOLDERS’ EQUITY | | | | | | |
| | |
Current Liabilities | | $ | 8,281 | | $ | 7,502 |
Long-term Debt | | | 14,547 | | | 16,932 |
Deferred Credits and Other Liabilities | | | 14,570 | | | 13,275 |
Minority Interests | | | 749 | | | 1,486 |
Preferred and preference stock without sinking fund requirements | | | — | | | 134 |
Common Stockholders’ Equity | | | 16,439 | | | 16,441 |
| | |
|
| |
|
|
Total Liabilities and Common Stockholders’ Equity | | $ | 54,586 | | $ | 55,770 |
| | |
|
| |
|
|
DUKE ENERGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In millions)
| | | | | | | | |
| | | Years Ended December 31,
| |
| | | 2005
| | | 2004
| |
| CASH FLOWS FROM OPERATING ACTIVITIES | | | | | | | | |
Net income | | $ | 1,824 | | | $ | 1,490 | |
Adjustments to reconcile net income to net cash provided by operating activities: | | | 939 | | | | 2,703 | |
| | |
|
|
| |
|
|
|
Net cash provided by operating activities | | | 2,763 | | | | 4,193 | |
| | |
|
|
| |
|
|
|
| CASH FLOWS FROM INVESTING ACTIVITIES | | | | | | | | |
Net cash used in investing activities | | | (134 | ) | | | (818 | ) |
| | |
|
|
| |
|
|
|
| CASH FLOWS FROM FINANCING ACTIVITIES | | | | | | | | |
Net cash used in financing activities | | | (2,743 | ) | | | (3,278 | ) |
| | |
|
|
| |
|
|
|
Changes in cash and cash equivalents associated with assets held for sale | | | 3 | | | | 39 | |
| | |
|
|
| |
|
|
|
Net (decrease) increase in cash and cash equivalents | | | (111 | ) | | | 136 | |
Cash and cash equivalents at beginning of period | | | 533 | | | | 397 | |
| | |
|
|
| |
|
|
|
Cash and cash equivalents at end of period | | $ | 422 | | | $ | 533 | |
| | |
|
|
| |
|
|
|
Supplemental Disclosures
Quarter Ended December 31, 2005
Duke Energy Corporation
| | | | | | | | | | | |
Mark-to-market Portfolio (in millions)
| | Non-AHFS
| | AHFS
| | | Total
| |
As of 12/31/2005 | | $ | — | | $ | (183 | ) | | $ | (183 | ) |
| | | |
Daily Earnings at Risk (DER) (in millions)
| | Continuing
| | Discontinued
| | | | |
95% Confidence Level, One-Day Holding Period, Two-Tailed | | | | | | | | | | | |
As of 12/31/2005 | | $ | — | | $ | 11 | | | $ | 12 | a |
| a | This figure excludes effects of the February 22, 2005 de-designation of certain hedges of Field Services’ commodity risk, which have been retained as undesignated derivatives. DER is lower than prior quarter due to terminations, which impacted the discontinued operations book. |
Duke Energy North America
| | | | | | | | | | | | | | | | | | | | | |
Owned Assets - Contracted Level
| | | | | 2006
| | | 2007
| |
| | | MWs Capacity
| | | Millions
MWh Available
| | | % Contracted
| | | Millions
MWh Available
| | | % Contracted
| |
Region
| | | | Capacity
| | | Energy
| | | | Capacity
| | | Energy
| |
Midwest | | 3,600 | b | | 28 | c | | 11 | % | | 0 | % | | 27 | c | | 12 | % | | 0 | % |
| b | Capacity excludes assets held for sale and classified as “Discontinued Operations”. |
| c | Midwest capacity includes 6.6 million MWh from peaking facilities in 2006 and 2007. |
Terms of Reference
MWs Capacity
Represents the official rated capacity of DENA’s percentage ownership of its merchant assets, excluding assets held for sale and classified as discontinued operations.
Millions MWhs Available
Represents the amount of electric power capable of being generated from owned merchant assets, excluding assets held for sale and classified as discontinued operations, after adjusting for scheduled maintenance and outage factors. For simple cycle
| facilities, | only peak demand periods were included in this calculation. |
% Contracted:
Capacity: Volumes contracted under tolls as well as Regulatory Must Run (“RMR”).
Energy: Volumes sold as forward power hedges.
AHFS
Assets Held For Sale
Duke Energy Corporation
Quarterly Highlights
Supplemental Franchised Electric Information
December 31, 2005
| | | | | | | | | | | | | | | | | | |
| | | Quarter Ended December 31,
| | | Year To Date December 31,
| |
| | | 2005
| | | 2004
| | | %
Inc.(Dec.)
| | | 2005
| | | 2004
| | | %
Inc.(Dec.)
| |
GWH Sales | | | | | | | | | | | | | | | | | | |
Residential | | 5,764 | | | 5,074 | | | 13.6 | % | | 25,460 | | | 24,543 | | | 3.7 | % |
General Service | | 6,063 | | | 5,788 | | | 4.8 | % | | 25,236 | | | 24,775 | | | 1.9 | % |
| | | | | | |
Industrial - Textile | | 1,557 | | | 1,757 | | | (11.4 | )% | | 6,561 | | | 7,147 | | | (8.2 | )% |
Industrial - Other | | 4,699 | | | 4,523 | | | 3.9 | % | | 18,800 | | | 17,938 | | | 4.8 | % |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total Industrial | | 6,256 | | | 6,280 | | | (0.4 | )% | | 25,361 | | | 25,085 | | | 1.1 | % |
| | | | | | |
Other Energy Sales | | 65 | | | 68 | | | (4.4 | )% | | 266 | | | 267 | | | (0.4 | )% |
Regular Resale | | 378 | | | 335 | | | 12.8 | % | | 1,501 | | | 1,467 | | | 2.3 | % |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total Regular Sales Billed | | 18,526 | | | 17,545 | | | 5.6 | % | | 77,824 | | | 76,137 | | | 2.2 | % |
| | | | | | |
Special Sales (A) | | 1,072 | | | 541 | | | 98.2 | % | | 6,301 | | | 5,385 | | | 17.0 | % |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total Electric Sales | | 19,598 | | | 18,086 | | | 8.4 | % | | 84,125 | | | 81,522 | | | 3.2 | % |
| | | | | | |
Unbilled Revenue | | 11 | | | 342 | | | (96.8 | )% | | (153 | ) | | (56 | ) | | (173.2 | )% |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total Duke Power Electric Sales | | 19,609 | | | 18,428 | | | 6.4 | % | | 83,972 | | | 81,466 | | | 3.1 | % |
| | | | | | |
Nantahala Electric Sales | | 350 | | | 326 | | | 7.4 | % | | 1,305 | | | 1,242 | | | 5.1 | % |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total DP Consolidated Electric Sales | | 19,959 | | | 18,754 | | | 6.4 | % | | 85,277 | | | 82,708 | | | 3.1 | % |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Average Number of Customers | | | | | | | | | | | | | | | | | | |
Residential | | 1,852,832 | | | 1,817,814 | | | 1.9 | % | | 1,839,759 | | | 1,805,232 | | | 1.9 | % |
General Service | | 313,293 | | | 306,806 | | | 2.1 | % | | 310,915 | | | 304,706 | | | 2.0 | % |
| | | | | | |
Industrial - Textile | | 777 | | | 828 | | | (6.2 | )% | | 796 | | | 852 | | | (6.6 | )% |
Industrial - Other | | 6,645 | | | 6,701 | | | (0.8 | )% | | 6,660 | | | 6,681 | | | (0.3 | )% |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total Industrial | | 7,422 | | | 7,529 | | | (1.4 | )% | | 7,456 | | | 7,533 | | | (1.0 | )% |
| | | | | | |
Other Energy Sales | | 13,061 | | | 12,900 | | | 1.2 | % | | 12,998 | | | 12,177 | | | 6.7 | % |
Regular Resale | | 15 | | | 15 | | | — | | | 15 | | | 15 | | | — | |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total Regular Sales | | 2,186,623 | | | 2,145,064 | | | 1.9 | % | | 2,171,143 | | | 2,129,663 | | | 1.9 | % |
| | | | | | |
Special Sales (A) | | 25 | | | 22 | | | 13.6 | % | | 30 | | | 34 | | | (11.8 | )% |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total Duke Power Electric Sales | | 2,186,648 | | | 2,145,086 | | | 1.9 | % | | 2,171,173 | | | 2,129,697 | | | 1.9 | % |
| | | | | | |
Nantahala Electric Sales | | 69,077 | | | 67,537 | | | 2.3 | % | | 68,391 | | | 66,995 | | | 2.1 | % |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
Total DP Average Number of Customers | | 2,255,725 | | | 2,212,623 | | | 1.9 | % | | 2,239,564 | | | 2,196,692 | | | 2.0 | % |
| | |
|
| |
|
| |
|
| |
|
| |
|
| |
|
|
| | | | | | | |
(A) Excludes sales to Nantahala Power and Light Company | | | | | | | |
| | | | | | |
Heating and Cooling Degree Days | | | | | | | | | | | | | | | | | | |
Actual | | | | | | | | | | | | | | | | | | |
Heating Degree Days | | 1,296 | | | 1,165 | | | 11.2 | % | | 3,272 | | | 3,259 | | | 0.4 | % |
Cooling Degree Days | | 66 | | | 40 | | | 65.1 | % | | 1,540 | | | 1,440 | | | 6.9 | % |
| | | | | | |
Variance from Normal | | | | | | | | | | | | | | | | | | |
Heating Degree Days | | 2.2 | % | | (7.2 | )% | | n/a | | | 1.8 | % | | 2.6 | % | | n/a | |
Cooling Degree Days | | 119.2 | % | | 58.8 | % | | n/a | | | 6.9 | % | | (0.8 | )% | | n/a | |
DUKE ENERGY CORPORATION
ONGOING TO REPORTED EARNINGS RECONCILIATION
December 2004 Quarter-to-date
(Dollars in Millions)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Ongoing
Earnings
| | | Special Items (Note 1)
| | | Discontinued
Operations,
excluding
Crescent
Resources
| | Total
Adjustments
| | | Reported
Earnings
| |
| | | | Gains
(Losses) on
sale of assets
| | | Gains (losses)
on sales and
impairments
of equity
investments
| | | Adjustment
to Captive
Insurance
Reserves
| | | Loss on
Asset
Exchanges
| | | | |
SEGMENT EARNINGS BEFORE INTEREST AND TAXES FROM CONTINUING OPERATIONS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | |
Franchised Electric | | $ | 252 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | $ | — | | | $ | 252 | |
| | | | | | | | |
Gas Transmission | | | 328 | | | | 4 | | | | 11 | | | | — | | | | — | | | | — | | | 15 | | | | 343 | |
| | | | | | | | |
Field Services | | | 124 | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | 124 | |
| | | | | | | | |
Duke Energy North America | | | (41 | ) | | | (30 | )A | | | — | | | | — | | | | — | | | | — | | | (30 | ) | | | (71 | ) |
| | | | | | | | |
International Energy | | | 64 | | | | (3 | ) | | | — | | | | — | | | | — | | | | — | | | (3 | ) | | | 61 | |
| | | | | | | | |
Crescent | | | 50 | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | 50 | |
| | |
|
|
| |
|
|
| |
|
|
| |
|
|
| |
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Total reportable segment EBIT | | | 777 | | | | (29 | ) | | | 11 | | | | — | | | | — | | | | — | | | (18 | ) | | | 759 | |
Other | | | (80 | ) | | | — | | | | (1 | ) | | | 64 | B | | | (4 | )C | | | — | | | 59 | | | | (21 | ) |
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Total reportable segment EBIT and other EBIT | | $ | 697 | | | $ | (29 | ) | | $ | 10 | | | $ | 64 | | | $ | (4 | ) | | $ | — | | $ | 41 | | | $ | 738 | |
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EARNINGS FOR COMMON | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | |
Total reportable segment EBIT and other EBIT | | $ | 697 | | | $ | (29 | ) | | $ | 10 | | | $ | 64 | | | $ | (4 | ) | | $ | — | | $ | 41 | | | $ | 738 | |
Foreign Currency Translation Gains (Losses) | | | 1 | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | 1 | |
Interest Income and other | | | 18 | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | 18 | |
Interest Expense | | | (297 | ) | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | (297 | ) |
Minority Interest (Expense) Benefit-Interest/Income Tax Expense | | | 11 | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | 11 | |
Income taxes on continuing operations | | | (154 | ) | | | 10 | | | | (3 | ) | | | (22 | ) | | | 1 | | | | — | | | (14 | ) | | | (168 | ) |
Discontinued operations, net of taxes | | | 1 | | | | — | | | | — | | | | — | | | | — | | | | 54 | | | 54 | | | | 55 | |
Trust Preferred/Preferred Dividends | | | (2 | ) | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | (2 | ) |
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Total Earnings for Common | | $ | 275 | | | $ | (19 | ) | | $ | 7 | | | $ | 42 | | | $ | (3 | ) | | $ | 54 | | $ | 81 | | | $ | 356 | |
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EARNINGS PER SHARE, BASIC | | $ | 0.29 | | | $ | (0.02 | ) | | $ | 0.01 | | | $ | 0.04 | | | $ | — | | | $ | 0.06 | | $ | 0.09 | | | $ | 0.38 | |
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EARNINGS PER SHARE, DILUTED | | $ | 0.28 | | | $ | (0.02 | ) | | $ | 0.01 | | | $ | 0.04 | | | $ | — | | | $ | 0.05 | | $ | 0.08 | | | $ | 0.36 | |
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Note 1 - Amounts for special items are entered net of minority interest
| A - | Net of minority interest of $20 million. |
| B - | Recorded in Operation, maintenance and other on the Consolidated Statements of Operations. |
| C - | Recorded in Other income and expenses, net on the Consolidated Statements of Operations. |
Weighted Average Shares (reported and ongoing) - in millions
DUKE ENERGY CORPORATION
ONGOING TO REPORTED EARNINGS RECONCILIATION
December 2005 Quarter-to-date
(Dollars in Millions)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Ongoing
Earnings
| | | Special Items (Note 1)
| | Discontinued
Operations/
Cumulative
Effect of Change
in Accounting
Principle
| | | Total
Adjustments
| | | Reported
Earnings
| |
| | | Loss on
Southeast
DENA contract termination
| | | Field
Services
hedge de- designation,
net
| | | MTM change on
de-designated
Field Services
hedges for 2005,
net
| | | MTM impact of
de-designated
Southeast
DENA hedges
| | | Tax Adjustments
| | | |
SEGMENT EARNINGS BEFORE INTEREST AND TAXES FROM CONTINUING OPERATIONS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | |
Franchised Electric | | $ | 279 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | $ | — | | | $ | — | | | $ | 279 | |
Gas Transmission | | | 344 | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | 344 | |
Field Services | | | 127 | | | | — | | | | 35 | B | | | — | | | | — | | | | — | | | — | | | | 35 | | | | 162 | |
Duke Energy North America | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | — | |
International Energy | | | 97 | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | 97 | |
Crescent | | | 104 | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | 104 | |
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Total reportable segment EBIT | | | 951 | | | | — | | | | 35 | | | | — | | | | — | | | | — | | | — | | | | 35 | | | | 986 | |
Other | | | (130 | ) | | | (75 | )A | | | — | | | | 64 | C | | | (9 | )D | | | — | | | — | | | | (20 | ) | | | (150 | ) |
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Total reportable segment EBIT and other EBIT | | $ | 821 | | | $ | (75 | ) | | $ | 35 | | | $ | 64 | | | $ | (9 | ) | | $ | — | | $ | — | | | $ | 15 | | | $ | 836 | |
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EARNINGS FOR COMMON | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | |
Total reportable segment EBIT and other EBIT | | $ | 821 | | | $ | (75 | ) | | $ | 35 | | | $ | 64 | | | $ | (9 | ) | | $ | — | | $ | — | | | $ | 15 | | | $ | 836 | |
Foreign Currency Translation Gains (Losses) | | | 1 | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | 1 | |
Interest Income and other | | | 22 | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | 22 | |
Interest Expense | | | (249 | ) | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | (249 | ) |
Minority Interest (Expense) Benefit - Interest/Income Tax Expense | | | (1 | ) | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | (1 | ) |
Income taxes on Continuing Operations | | | (196 | ) | | | 28 | | | | (13 | ) | | | (22 | ) | | | 3 | | | | 12 | | | — | | | | 8 | | | | (188 | ) |
Discontinued Operations, net of taxes | | | 5 | | | | — | | | | — | | | | — | | | | — | | | | — | | | 184 | E,F | | | 184 | | | | 189 | |
Cumulative Effect of Change in Accounting Principle | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | (4 | ) | | | (4 | ) | | | (4 | ) |
Trust Preferred/Preferred Dividends | | | (5 | ) | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | (5 | ) |
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Total Earnings for Common | | $ | 398 | | | $ | (47 | ) | | $ | 22 | | | $ | 42 | | | $ | (6 | ) | | $ | 12 | | $ | 180 | | | $ | 203 | | | $ | 601 | |
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EARNINGS PER SHARE, BASIC | | $ | 0.43 | | | $ | (0.05 | ) | | $ | 0.02 | | | $ | 0.05 | | | $ | (0.01 | ) | | $ | 0.01 | | $ | 0.20 | | | $ | 0.22 | | | $ | 0.65 | |
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EARNINGS PER SHARE, DILUTED | | $ | 0.42 | | | $ | (0.04 | ) | | $ | 0.02 | | | $ | 0.04 | | | $ | (0.01 | ) | | $ | 0.01 | | $ | 0.19 | | | $ | 0.21 | | | $ | 0.63 | |
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Note 1 - Amounts for special items are entered net of minority interest
| A - | Recorded in Gains (Losses) on Sales of Other Assets, net on the Consolidated Statements of Operations. |
| B - | Fourth quarter settlement of the 2005 portion of the Field Services de-designated hedges as of 2/22/05, recorded in Equity in earnings of unconsolidated affiliates on the Consolidated Statements of Operations. |
| C - | Recorded in Other income and expenses, net on the Consolidated Statements of Operations. |
| D - | Recorded in Non-regulated electric, natural gas, natural gas liquids and other revenues on the Consolidated Statements of Operations. |
| E - | Excludes Crescent discontinued operations. |
| F - | Primarily DENA discontinued operations. Recorded in (Loss) Income From Discontinued Operations, net of tax on the Consolidated Statements of Operations. |
Weighted Average Shares (reported and ongoing) - in millions
DUKE ENERGY CORPORATION
ONGOING TO REPORTED EARNINGS RECONCILIATION
December 2004 Year-to-date
(Dollars in Millions)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | Special Items (Note 1)
| | | | | | | | |
| | | Ongoing
Earnings
| | | Gains (Losses) on sale of assets
| | | Impairment
| | | Gains (losses) on sales and impairments of equity investments
| | | Enron Settlement
| | | Adjustment to Captive Insurance Reserves
| | | Loss on Asset Exchanges
| | | Tax Benefit from DEA
Restructuring
| | Discontinued Operations, excluding Crescent Resources
| | Total Adjustments
| | | Reported Earnings
| |
SEGMENT EARNINGS BEFORE INTEREST AND TAXES FROM CONTINUING OPERATIONS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | |
Franchised Electric | | $ | 1,464 | | | $ | 3 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | $ | — | | $ | 3 | | | $ | 1,467 | |
Gas Transmission | | | 1,297 | | | | 16 | | | | — | | | | 16 | | | | — | | | | — | | | | — | | | | — | | | — | | | 32 | | | | 1,329 | |
Field Services | | | 391 | | | | 1 | A | | | (10 | )B | | | (16 | )C | | | 1 | D | | | — | | | | — | | | | — | | | — | | | (24 | ) | | | 367 | |
Duke Energy North America | | | (190 | ) | | | (403 | )E | | | — | | | | — | | | | 8 | D,F | | | — | | | | — | | | | — | | | — | | | (395 | ) | | | (585 | ) |
International Energy | | | 236 | | | | (2 | ) | | | (13 | )D | | | 1 | | | | — | | | | — | | | | — | | | | — | | | — | | | (14 | ) | | | 222 | |
Crescent | | | 240 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | — | | | | 240 | |
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Total reportable segment EBIT | | | 3,438 | | | | (385 | ) | | | (23 | ) | | | 1 | | | | 9 | | | | — | | | | — | | | | — | | | — | | | (398 | ) | | | 3,040 | |
Other | | | (164 | ) | | | 4 | | | | — | | | | 2 | | | | 21 | D | | | 64 | D | | | (4 | )G | | | — | | | — | | | 87 | | | | (77 | ) |
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Total reportable segment EBIT and other EBIT | | $ | 3,274 | | | $ | (381 | ) | | $ | (23 | ) | | $ | 3 | | | $ | 30 | | | $ | 64 | | | $ | (4 | ) | | $ | — | | $ | — | | $ | (311 | ) | | $ | 2,963 | |
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EARNINGS FOR COMMON | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | |
Total reportable segment EBIT and other EBIT | | $ | 3,274 | | | $ | (381 | ) | | $ | (23 | ) | | $ | 3 | | | $ | 30 | | | $ | 64 | | | $ | (4 | ) | | $ | — | | $ | — | | $ | (311 | ) | | $ | 2,963 | |
Foreign Currency Translation Gains (Losses) | | | 1 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | — | | | | 1 | |
Interest Income and other | | | 64 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | — | | | | 64 | |
Interest Expense | | | (1,281 | ) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | — | | | | (1,281 | ) |
Minority Interest (Expense) Benefit- Interest/Income Tax Expense | | | 38 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | — | | | | 38 | |
Income taxes on continuing operations | | | (690 | ) | | | 133 | | | | 8 | | | | — | | | | (11 | ) | | | (22 | ) | | | 1 | | | | 48 | | | — | | | 157 | | | | (533 | ) |
Discontinued operations, net of taxes | | | 5 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | 233 | | | 233 | | | | 238 | |
Trust Preferred/Preferred Dividends | | | (9 | ) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | — | | | | (9 | ) |
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Total Earnings for Common | | $ | 1,402 | | | $ | (248 | ) | | $ | (15 | ) | | $ | 3 | | | $ | 19 | | | $ | 42 | | | $ | (3 | ) | | $ | 48 | | $ | 233 | | $ | 79 | | | $ | 1,481 | |
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EARNINGS PER SHARE, BASIC | | $ | 1.51 | | | $ | (0.27 | ) | | $ | (0.02 | ) | | $ | — | | | $ | 0.02 | | | $ | 0.05 | | | $ | — | | | $ | 0.05 | | $ | 0.25 | | $ | 0.08 | | | $ | 1.59 | |
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EARNINGS PER SHARE, DILUTED | | $ | 1.46 | | | $ | (0.25 | ) | | $ | (0.02 | ) | | $ | — | | | $ | 0.02 | | | $ | 0.04 | | | $ | — | | | $ | 0.05 | | $ | 0.24 | | $ | 0.08 | | | $ | 1.54 | |
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Note 1 - Amounts for special items are entered net of minority interest
| A - | Net of minority interest of $1 million. |
| B - | Net of minority interest of $12 million. |
| C - | Net of minority interest of $7 million. |
| D - | Recorded in Operation, maintenance and other on the Consolidated Statements of Operations. |
| E - | $(397) million recorded in Gains (Losses) on Sales of Other Assets, net (net of $25 million of minority interest) and $(6) million recorded in Operation, maintenance and other on the Consolidated Statements of Operations. |
| F - | Amount is net of $5 million of minority interest. |
| G - | Recorded in Other income and expenses, net on the Consolidated Statements of Operations. |
Weighted Average Shares (reported and ongoing) - in millions
DUKE ENERGY CORPORATION
ONGOING TO REPORTED EARNINGS RECONCILIATION
December 2005 Year-to-date
(Dollars in Millions)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | Special Items (Note 1)
| | | | | | | | | |
| | | Ongoing
Earnings
| | | Loss on
Southeast
DENA
contract
termination
| | | Mutual insurance liability
adjustment
| | | Gain on transfer of 19.7% interest in DEFS
| | | Gains (losses) on sales and impairments of equity
investments
| | | Field Services hedge
de-designation,
net
| | | Initial gain and subsequent
MTM change on de-designated Southeast DENA hedges
| | | Tax
Adjustments
| | Discontinued Operations/ Cumulative Effect of Change in Accounting
Principle
| | | Total
Adjustments
| | | Reported
Earnings
| |
SEGMENT EARNINGS BEFORE INTEREST AND TAXES FROM CONTINUING OPERATIONS | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | |
Franchised Electric | | $ | 1,495 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | $ | — | | | $ | — | | | $ | 1,495 | |
Gas Transmission | | | 1,388 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | 1,388 | |
Field Services | | | 505 | | | | — | | | | — | | | | 576 | C | | | 888 | A | | | (23 | )B | | | — | | | | — | | | — | | | | 1,441 | | | | 1,946 | |
Duke Energy North America | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | — | |
International Energy | | | 334 | | | | — | | | | — | | | | — | | | | (20 | )E | | | — | | | | — | | | | — | | | — | | | | (20 | ) | | | 314 | |
Crescent | | | 314 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | 314 | |
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Total reportable segment EBIT | | | 4,036 | | | | — | | | | — | | | | 576 | | | | 868 | | | | (23 | ) | | | — | | | | — | | | — | | | | 1,421 | | | | 5,457 | |
Other | | | (563 | ) | | | (75 | )C | | | (28 | )D | | | — | | | | — | | | | — | | | | 21 | F | | | — | | | — | | | | (82 | ) | | | (645 | ) |
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Total reportable segment EBIT and other EBIT | | $ | 3,473 | | | $ | (75 | ) | | $ | (28 | ) | | $ | 576 | | | $ | 868 | | | $ | (23 | ) | | $ | 21 | | | $ | — | | $ | — | | | $ | 1,339 | | | $ | 4,812 | |
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EARNINGS FOR COMMON | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
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Total reportable segment EBIT and other EBIT | | $ | 3,473 | | | $ | (75 | ) | | $ | (28 | ) | | $ | 576 | | | $ | 868 | | | $ | (23 | ) | | $ | 21 | | | $ | — | | $ | — | | | $ | 1,339 | | | $ | 4,812 | |
Foreign Currency Translation Gains (Losses) | | | (11 | ) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | (11 | ) |
Interest Income and other | | | 57 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | 57 | |
Interest Expense | | | (1,062 | ) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | (1,062 | ) |
Minority Interest (Expense) Benefit - Interest/Income Tax Expense | | | 20 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | 20 | |
Income taxes on Continuing Operations | | | (798 | ) | | | 28 | | | | 10 | | | | (213 | ) | | | (323 | ) | | | 9 | | | | (8 | ) | | | 12 | | | — | | | | (485 | ) | | | (1,283 | ) |
Discontinued Operations, net of taxes | | | 7 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | (712 | )G,H | | | (712 | ) | | | (705 | ) |
Cumulative Effect of Change in Accounting Principle | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | (4 | ) | | | (4 | ) | | | (4 | ) |
Trust Preferred/Preferred Dividends | | | (12 | ) | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | — | | | | — | | | | (12 | ) |
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Total Earnings for Common | | $ | 1,674 | | | $ | (47 | ) | | $ | (18 | ) | | $ | 363 | | | $ | 545 | | | $ | (14 | ) | | $ | 13 | | | $ | 12 | | $ | (716 | ) | | $ | 138 | | | $ | 1,812 | |
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EARNINGS PER SHARE, BASIC | | $ | 1.79 | | | $ | (0.05 | ) | | $ | (0.02 | ) | | $ | 0.39 | | | $ | 0.58 | | | $ | (0.01 | ) | | $ | 0.01 | | | $ | 0.01 | | $ | (0.76 | ) | | $ | 0.15 | | | $ | 1.94 | |
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EARNINGS PER SHARE, DILUTED | | $ | 1.73 | | | $ | (0.04 | ) | | $ | (0.02 | ) | | $ | 0.37 | | | $ | 0.56 | | | $ | (0.01 | ) | | $ | 0.01 | | | $ | 0.01 | | $ | (0.73 | ) | | $ | 0.15 | | | $ | 1.88 | |
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Note 1 - Amounts for special items are entered net of minority interest
| A - | Gain on sale of investment in units of TEPPCO LP, $97 million, and TEPPCO GP, $791 million net of $343 million of minority interest. |
| B - | De-designation of hedges due to the transfer of 19.7% interest in DEFS to ConocoPhillips. $125 million loss recorded in Impairment and other charges on the Consolidated Statements of Operations, reduced by $29 million of hedge settlements recorded in Non-regulated electric, natural gas, natural gas liquids and other revenues, and $73 million of hedge settlements recorded in Equity in Earnings of Unconsolidated Affiliates on the Consolidated Statements of Operations. |
| C - | Recorded in Gains (Losses) on Sales of Other Assets, net on the Consolidated Statements of Operations. |
| D - | Recorded in Operation, maintenance and other on the Consolidated Statements of Operations. |
| E - | Campeche equity investment impairment, recorded in Gains (Losses) on sales and impairments of equity investments on the Consolidated Statements of Operations. |
| F - | Recorded in Non-regulated electric, natural gas, natural gas liquids and other revenues on the Consolidated Statements of Operations. |
| G - | Excludes Crescent discontinued operations. |
| H - | Primarily the non-cash, after-tax charge related to the planned exit of substantially all of DENA’s physical and commercial assets outside the midwestern United States and the reclassification of DENA 2005 operations. Recorded in (Loss) Income From Discontinued Operations, net of tax on the Consolidated Statements of Operations. |
Weighted Average Shares (reported and ongoing) - in millions
Special items impacting EPS for the year (as summarized in this earnings release) include:
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(In millions, except per share amounts)
| | Pre-Tax
Amount
| | | Tax
Effect
| | | 2005
Basic
EPS
Impact
| | | 2004
Basic
EPS
Impact
| | | 2005
Diluted
EPS
Impact
| | | 2004
Diluted
EPS
Impact
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Year-ended 2005 | | | | | | | | | | | | | | | | | | | | | | | | |
Gain on sale of TEPPCO GP (net of minority interest of $343 million) | | $ | 791 | | | $ | (293 | ) | | $ | 0.53 | | | | | | | $ | 0.51 | | | | | |
Gain on sale of TEPPCO LP units | | $ | 97 | | | $ | (36 | ) | | $ | 0.07 | | | | | | | $ | 0.06 | | | | | |
Loss on de-designation of Field Services’ hedges, net of settlements on 2005 positions | | $ | (23 | ) | | $ | 9 | | | $ | (0.01 | ) | | | | | | $ | (0.01 | ) | | | | |
Additional liabilities related to mutual insurance companies | | $ | (28 | ) | | $ | 10 | | | $ | (0.02 | ) | | | | | | $ | (0.02 | ) | | | | |
Gain on transfer of 19.7 percent interest in DEFS to ConocoPhillips | | $ | 576 | | | $ | (213 | ) | | $ | 0.39 | | | | | | | $ | 0.37 | | | | | |
Impairment of DEI’s investment in Campeche | | $ | (20 | ) | | $ | 6 | | | $ | (0.02 | ) | | | | | | $ | (0.01 | ) | | | | |
Initial and subsequent net mark-to-market gains on de-designating Southeast DENA hedges | | $ | 21 | | | $ | (8 | ) | | $ | 0.01 | | | | | | | $ | 0.01 | | | | | |
Loss on Southeast DENA contract termination | | $ | (75 | ) | | $ | 28 | | | $ | (0.05 | ) | | | | | | $ | (0.04 | ) | | | | |
Tax adjustments | | | — | | | $ | 12 | | | $ | 0.01 | | | | | | | $ | 0.01 | | | | | |
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Year-ended 2004 | | | | | | | | | | | | | | | | | | | | | | | | |
Net loss on sale of assets (net of minority interest of $24 million), primarily the sale of DENA southeast U.S. plants | | $ | (381 | ) | | $ | 133 | | | | | | | $ | (0.27 | ) | | | | | | $ | (0.25 | ) |
Asset impairments (net of minority interest of $12 million) | | $ | (23 | ) | | $ | 8 | | | | | | | $ | (0.02 | ) | | | | | | $ | (0.02 | ) |
Net gain on sales of equity investments and impairments of equity investments (net of minority interest of $7 million) | | $ | 3 | | | | — | | | | | | | | — | | | | | | | | — | |
Enron settlement (net of minority interest of $5 million) | | $ | 30 | | | $ | (11 | ) | | | | | | $ | 0.02 | | | | | | | $ | 0.02 | |
Tax benefit from DEA restructuring | | | — | | | $ | 48 | | | | | | | $ | 0.05 | | | | | | | $ | 0.05 | |
Adjustment to captive insurance reserves | | $ | 64 | | | $ | (22 | ) | | | | | | $ | 0.05 | | | | | | | $ | 0.04 | |
Loss on asset exchanges | | $ | (4 | ) | | $ | 1 | | | | | | | | — | | | | | | | | — | |
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TOTAL EPS IMPACT | | | | | | | | | | $ | 0.91 | | | $ | (0.17 | ) | | $ | 0.88 | | | $ | (0.16 | ) |
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GAAP Reconciliation:
EPS from discontinued operations excluding Crescent Resources, and cumulative effect of change in accounting principle
(In millions, except per share amounts)
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| | | 4Q 2005
| | | 4Q 2004
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Income from discontinued operations, net of tax | | $ | 189 | | | $ | 55 | |
Crescent Resources discontinued operations, net of tax | | | (5 | ) | | | (1 | ) |
Cumulative effect of change in accounting principle, net of tax | | | (4 | ) | | | — | |
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Discontinued operations excluding Crescent Resources, and cumulative effect of change in accounting principle | | $ | 180 | | | $ | 54 | |
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Basic EPS from discontinued operations excluding Crescent Resources, and cumulative effect of change in accounting principle | | $ | 0.20 | | | $ | 0.06 | |
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| | | YTD 2005
| | | YTD 2004
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(Loss) income from discontinued operations, net of tax | | $ | (705 | ) | | $ | 238 | |
Crescent Resources discontinued operations, net of tax | | | (7 | ) | | | (5 | ) |
Cumulative effect of change in accounting principle, net of tax | | | (4 | ) | | | — | |
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Discontinued operations excluding Crescent Resources, and cumulative effect of change in accounting principle | | $ | (716 | ) | | $ | 233 | |
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Basic EPS from discontinued operations excluding Crescent Resources, and cumulative effect of change in accounting principle | | $ | (0.76 | ) | | $ | 0.25 | |
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Diluted EPS from discontinued operations excluding Crescent Resources, and cumulative effect of change in accounting principle | | $ | (0.73 | ) | | $ | 0.24 | |
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