Exhibit 99
IDACORP, INC.
1221 W. Idaho Street
Boise, ID 83702
October 31, 2007
FOR IMMEDIATE RELEASE
Lawrence F. Spencer, Director of Investor Relations
Phone: (208) 388-2664
lspencer@idacorpinc.com
IDACORP Announces Third Quarter 2007 Results
Third Quarter 2007 Summary
• IDACORP earnings per share from continuing operations of $0.65 versus $0.76 in 2006. Diluted earnings per share were $0.65 versus $1.03 in 2006.
o Third quarter 2006 included $0.27 per share from sale of IDACORP Technologies included in discontinued operations
o Poor hydroelectric generating conditions and increased operating
and maintenance expenses reduced operating income at Idaho Power
o Warm, dry weather and customer growth increased utility energy sales
BOISE--IDACORP, Inc. (NYSE:IDA) today reported third quarter net income of $28.9 million as compared with $44.0 million in 2006. Third quarter diluted earnings per share decreased by $0.38 from the third quarter 2006 to $0.65 per share. Third quarter 2006 results included the benefits of the sale of IDACORP Technologies (ITI) of $11.5 million or $0.27 per share.
"Income from continuing operations declined in the third quarter versus last year as drought conditions required increased reliance on wholesale energy purchases and operation of our natural gas fired power plants to meet heavy summer loads," said IDACORP President and Chief Executive Officer J. LaMont Keen. "When combined with anticipated increases in other costs of operation, the higher transmission and power supply expenses more than offset the benefit of increased revenues.
"We filed for general rate relief in our Idaho jurisdiction in June in order to include increased operating costs and a return on new capital investments in our regulatory cost structure on a more timely basis. On October 19, the procedural schedule for the case was extended for six weeks by mutual consent of the parties. The extension allows other parties to the case to review Idaho Power's third quarter results before filing their testimony. Any rate change is now expected to become effective in February 2008."
Analysis of Earnings per Diluted Share
The following table summarizes diluted earnings (losses) per share from
each business:
Earnings (Losses) From | Three Months Ended | | Nine Months Ended |
Continuing Operations | 9/30/07 | | 9/30/06 | | 9/30/07 | | 9/30/06 | |
| | | | | | | | |
| Idaho Power Company (IPC) | $ 0.54 | | $ 0.71 | | $ 1.44 | | $ 1.80 |
| IDACORP Financial Services | 0.04 | | 0.05 | | 0.12 | | 0.15 |
| Ida-West Energy | | 0.02 | | 0.03 | | 0.05 | | 0.06 |
| Holding Company | | 0.05 | | (0.03) | | 0.02 | | (0.09) |
Earnings From Discontinued Operations | - | | 0.27 | | - | | 0.17 |
Earnings Per Diluted Share | $ 0.65 | | $ 1.03 | | $ 1.63 | | $ 2.09 |
Third Quarter and Year-to-Date 2007 Performance Summary
A summary of IDACORP's net income and earnings per diluted share is as follows (thousands, except per share amounts):
| | Three months ended | | Nine months ended |
| | September 30, | | September 30, |
| | 2007 | | 2006 | | 2007 | | 2006 |
| | | | | | | | | |
Net income | | $ | 28,931 | | $ | 43,989 | | $ | 72,044 | | $ | 89,321 |
Weighted average common shares outstanding - diluted | | | 44,543 | | | 42,863 | | | 44,080 | | | 42,710 |
Earnings per diluted share | | $ | 0.65 | | $ | 1.03 | | $ | 1.63 | | $ | 2.09 |
The key factors affecting the change in IDACORP's net income for the third quarter and year-to-date 2007 include (amounts shown are net of income taxes):
| | Three months ended | | Nine months ended |
| | September 30, | | September 30, |
| | 2007 | | 2006 | | 2007 | | 2006 |
| | | | | | | | |
Net income | | $ | 24,108 | | $ | 30,389 | | $ | 63,603 | | $ | 77,022 |
IDACORP weighted average common shares outstanding - diluted | | | 44,543 | | | 42,863 | | | 44,080 | | | 42,710 |
Earnings per diluted share | | $ | 0.54 | | $ | 0.71 | | $ | 1.44 | | $ | 1.80 |
The key factors affecting the decrease in IPC's net income for the third quarter and year-to-date 2007 include (amounts shown are net of income taxes):
- Increased retail sales contributed $3.2 million and $11.9 million to electric utility margin (see "Non-GAAP Financial Measures" below for a calculation of electric utility margin) for the third quarter and year-to-date 2007, respectively. Warmer and drier conditions in 2007 led to higher irrigation loads as compared to the prior year. IPC continued to experience moderate customer growth, with the average number of general business customers increasing 11,585 and 12,744 for the third quarter and year-to-date 2007 compared to the same periods in 2006, an increase of 2.5 percent and 2.8 percent, respectively.
- Increased costs to supply power, net of rate adjustments, reduced electric utility margin by $6.4 million and $12.5 million for the third quarter and year-to-date 2007, respectively. Poor hydroelectric generating conditions in 2007 increased IPC's reliance on typically more expensive thermal generation and purchased power, and reduced wholesale sales. IPC's hydroelectric generation contributed only 41 percent and 48 percent of total system generation for the third quarter and year-to-date 2007, respectively, as compared to 47 percent and 60 percent for the same periods in 2006.
- Increases in other O&M expenses reduced earnings by $4.1 million and $14.4 million for the third quarter and year-to-date 2007, respectively, compared to the same periods in 2006. The quarter increase is primarily the result of increases in third-party transmission costs (included in electric utility margin) and regulatory commission expenses. The year-to-date increase is primarily the result of increases in third-party transmission costs, regulatory commission expenses, maintenance expenses for IPC's coal-fired generation facilities, hydroelectric license and inspection costs, and the Fixed Cost Adjustment accrual which began in 2007.
- Gain on sales of excess SO2 emission allowances was $1.1 million and $1.7 million in the third quarter and year-to-date 2007, respectively, compared to $0.0 million and $5.0 million in the same periods in 2006.
Non-GAAP Financial Measures
The following discussion includes financial information prepared in accordance with generally accepted accounting principles (GAAP), as well as one other financial measure, electric utility margin, that is considered a "non-GAAP financial measure" as defined in accordance with SEC rules. Generally, a non-GAAP financial measure is a numerical measure of a company's financial performance, financial position or cash flows that exclude (or include) amounts that are included in (or excluded from) the most directly comparable measure calculated and presented in accordance with GAAP. This non-GAAP financial measure reflects an additional way of viewing an aspect of IPC's operations that, when viewed with IPC's GAAP results and the accompanying reconciliation to electric utility operating income, the corresponding GAAP financial measure, may provide a more complete understanding of factors and trends affecting IPC's business. Management uses this measure, in addition to GAAP measures, in evaluating the performance and outlook of IPC, and therefore believes investors should have similar data when making decisions. Electric utility margin is used by IPC to help determine whether IPC is collecting the appropriate amount of energy costs from its customers to allow recovery of operating costs. Electric utility margin helps management understand the regulatory portions of business and the effects of regulatory mechanisms. The primary limitation associated with the use of this non-GAAP measure is that IPC's electric utility margin measure may not be comparable to other companies' electric utility margin measure. When evaluating and conducting business, management is not burdened with the limitations of the non-GAAP financial measure since the limitations pertain primarily to comparisons outside IPC. For external users, the non-GAAP financial measure provides additional information to IPC's GAAP disclosures and users can assess which information best suits their needs. Furthermore, this measure is not intended to replace operating income as determined in accordance with GAAP as an indicator of operating performance.
The calculations of IPC's electric utility margin are as follows:
| | Three months ended | | Nine months ended |
| | September 30, | | September 30, |
| | 2007 | | 2006 | | 2007 | | 2006 |
| | | | | | | | |
General business revenue | $ | 211,873 | $ | 179,411 | $ | 511,337 | $ | 500,803 |
PCA amortization | | (3,238) | | 3,779 | | 2,504 | | (571) |
Other revenues amortization: | | | | | | | | |
| Irrigation load reduction | | - | | 118 | | - | | (5,400) |
| Rate case tax settlement | | - | | 100 | | - | | (4,745) |
| | Adjusted general business revenue | | 208,635 | | 183,408 | | 513,841 | | 490,087 |
Power supply costs: | | | | | | | | |
| Sales for resale | | 34,843 | | 39,692 | | 129,859 | | 219,531 |
| Purchased power | | (110,108) | | (98,926) | | (241,393) | | (229,659) |
| Fuel | | (43,291) | | (34,933) | | (101,724) | | (83,856) |
| PCA deferral | | 46,987 | | 51,216 | | 104,953 | | 7,499 |
| | Net power supply costs | | (71,569) | | (42,951) | | (108,305) | | (86,485) |
Third party transmission expense | | (4,851) | | (2,874) | | (9,383) | | (6,583) |
Other revenues (excluding DSM) | | 9,493 | | 9,478 | | 28,806 | | 26,732 |
| Electric utility margin | $ | 141,708 | $ | 147,061 | $ | 424,959 | $ | 423,751 |
The following reconciles electric utility margin to electric utility operating income (GAAP):
| | Three months ended | | Nine months ended |
| | September 30, | | September 30, |
| | 2007 | | 2006 | | 2007 | | 2006 |
| | | | | | | | |
Electric utility margin | $ | 141,708 | $ | 147,061 | $ | 424,959 | $ | 423,751 |
Other operations and maintenance | | | | | | | |
| (excluding third party | | | | | | | | |
| transmission expense) | | (64,303) | | (59,521) | | (206,487) | | (187,326) |
Gain on sale of emission allowances | | 1,872 | | 22 | | 2,754 | | 8,258 |
Depreciation | | (25,967) | | (25,289) | | (76,870) | | (74,471) |
Taxes other than income taxes | | (4,714) | | (4,057) | | (14,267) | | (15,957) |
| Operating income - electric utility (GAAP) | $ | 48,596 | $ | 58,216 | $ | 130,089 | $ | 154,255 |
2007 Outlook
The outlook for key operating and financial metrics are:
Key Operating & Financial Metrics | Current Estimates (1) | Previous Estimate |
Idaho Power Company Operation & Maintenance Expense (Millions) (2) | No change | $270-$280 |
Idaho Power Company Capital Expenditures (Millions) (3) | $280-$300 | $290-$320 |
Idaho Power Company Hydroelectric Generation (Million MWh) | No change | 6.0-6.5 |
Non-regulated Subsidiary Earnings Per Share from Continuing Operations (4) | No change | $0.10-$0.15 |
Effective Tax Rates: Idaho Power Company Consolidated - IDACORP (5) | No change No change | 32%-36% 15%-20% |
(1) Key operating and financial metrics will be updated quarterly.
(2) Excludes demand-side management expenses.
(3) 2007-2009 estimated total capital expenditures of $830 million, excluding new base load plant.
(4) Estimates include contributions from Ida-West Energy and IDACORP Financial netted against holding company expenses.
(5) For continuing operations.
The expected range of capital expenditures at IPC has been reduced due to the timing of expenditures on the gas peaking unit at the Evander Andrews Complex. The timing of certain expenditures has shifted from the fourth quarter 2007 to first quarter 2008. The project continues on budget and is expected to be in-service in time for the 2008 summer loads.
Web Cast / Conference Call
The company will hold an analyst conference call today at 2:30 p.m.
Mountain Time (4:30 p.m. Eastern Time). All parties interested in listening may do so through a live Web cast. Details of the conference call logistics are posted on the company's Web site (http://www.idacorpinc.com). A replay of the conference call will be available on the company's Web site for a period of 12 months.
Background Information / Safe Harbor Statement
Boise, Idaho-based IDACORP, formed in 1998, is a holding company comprised of Idaho
Power Company, a regulated electric utility; IDACORP Financial, a holder of affordable housing projects and other real estate investments; and Ida-West Energy, an operator of small hydroelectric generation projects that satisfy the requirements of the Public Utility Regulatory Policies Act of 1978.
Certain statements contained in this news release, including statements with respect to
future earnings, ongoing operations, and financial conditions, are "forward-looking statements" within the meaning of federal securities laws. Although IDACORP and Idaho Power believe that the expectations and assumptions reflected in these forward-looking statements are reasonable, these statements involve a number of risks and uncertainties, and actual results may differ materially from the results discussed in the statements. Factors that could cause actual results to differ materially from the forward-looking statements include: changes in and compliance with governmental policies, including new interpretations of existing policies, and regulatory actions and regulatory audits, including those of the Federal Energy Regulatory Commission, the North American Electric Reliability Corporation, the Western Electricity Coordinating Council, the Idaho Public Utilities Commission, the Oregon Public Utility Commission, and the Internal Revenue Service with respect to allowed rates of return, industry and rate structure, day-to-day business operations, acquisition and disposal of assets and facilities, operation and construction of plant facilities, provision of transmission services, relicensing of hydroelectric projects, recovery of purchased power expenses, recovery of other capital investments, present or prospective wholesale and retail competition, including but not limited to retail wheeling and transmission costs, and other refund proceedings; changes arising from the Energy Policy Act of 2005; litigation and regulatory proceedings, including those resulting from the energy situation in the western United States, and penalties and settlements that influence business and profitability; changes in and compliance with environmental, endangered species and safety laws and policies; weather variations affecting hydroelectric generating conditions and customer energy usage; over-appropriation of surface and groundwater in the Snake River Basin resulting in reduced generation at hydroelectric facilities; construction of power generating, transmission and distribution facilities including an inability to obtain required governmental permits and approvals, and risks related to contracting, construction and start-up; operation of power generating facilities including breakdown or failure of equipment, performance below expected levels, competition, fuel supply, including availability, transportation and prices, and availability of transmission; blackouts or other disruptions of Idaho Power Company's or the western interconnected transmission systems; impacts from the potential formation of a regional transmission organization or the development of another transmission group; population growth rates and demographic patterns; market demand and prices for energy, including structural market changes; changes in operating expenses and capital expenditures, including costs and availability of materials and commodities, and fluctuations in sources and uses of cash; results of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by factors such as credit ratings and general economic conditions; actions by credit rating agencies, including changes in rating criteria and new interpretations of existing criteria; homeland security, natural disasters and other natural risks, such as earthquake, flood, drought, lightning, wind and fire, acts of war or terrorism; market conditions that could affect the operations and prospects of IDACORP's subsidiaries or their competitors; increasing health care costs and the resulting effect on medical benefits paid for employees; performance of the stock market and the changing interest rate environment, which affect the amount of required contributions to pension plans, as well as the reported costs of providing pension and other postretirement benefits; increasing costs of insurance, changes in coverage terms and the ability to obtain insurance; changes in tax rates or policies, interest rates or rates of inflation; adoption of or changes in critical accounting policies or estimates; and new accounting or Securities and Exchange Commission requirements, or new interpretation or application of existing requirements. Any such forward-looking statements should be considered in light of such factors and others noted in the companies' Annual Report on Form 10-K for the year ended December 31, 2006, and the Quarterly Report on Form 10-Q for the quarters ended March 31, 2007 and June 30, 2007, and other reports on file with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date on which such statement is made. New factors emerge from time to time and it is not possible for management to predict all such factors, nor can it assess the impact of any such factor on the business or the extent to which any factor, or combination of factors, may cause results to differ materially from those contained in any forward-looking statement.
IDACORP, Inc.
Condensed Consolidated Statements of Income
For Periods Ended September 30, 2007 and 2006
Summary Financial Information
(unaudited)
(Thousands of Dollars, except per share amounts)
Three Months Ended Nine Months Ended
9/30/07 9/30/06 9/30/07 9/30/06
Operating Revenues:
Electric Utility:
General business........................................ $ 211,873 $ 179,411 $ 511,337 $ 500,803
Off-system sales.......................................... 34,843 39,692 129,859 219,531
Other revenues............................................. 13,800 9,696 37,776 16,587
Total electric utility revenues.................. 260,516 228,799 678,972 736,921
Other................................................................. 947 1,733 2,976 4,586
Total Operating Revenues..................... 261,463 230,532 681,948 741,507
Operating Expenses:
Electric Utility:
Purchased power......................................... 110,108 98,926 241,393 229,659
Fuel expense................................................ 43,291 34,933 101,724 83,856
Power cost adjustment............................... (43,749) (54,995) (107,457) (6,928)
Other operations & maintenance.............. 69,154 62,395 215,870 193,909
Demand-side management...................... 4,307 - 8,970
Gain on sale of emission allowances..... (1,872) (22) (2,754) (8,258)
Depreciation.................................................. 25,967 25,289 76,870 74,471
Taxes other than income taxes................. 4,714 4,057 14,267 15,957
Total electric utility expenses................. 211,920 170,583 548,883 582,666
Other................................................................. 1,613 3,293 4,782 10,157
Total Operating Expenses...................... 213,533 173,876 553,665 592,823
Operating Income (Loss):
Electric Utility................................................... 48,596 58,216 130,089 154,255
Other................................................................. (666) (1,560) (1,806) (5,571)
Total Operating Income.......................... 47,930 56,656 128,283 148,684
Other Income..................................................... 4,616 4,431 13,867 14,181
Losses of Unconsolidated
Equity-Method Investments.......................... (380) (444) (3,257) (2,703)
Other Expenses................................................. 2,055 2,669 6,838 6,745
Interest Expense:
Interest on long-term debt............................ 15,862 14,241 43,306 42,525
Other interest.................................................. 763 549 3,881 2,753
............................. Total Interest expense 16,625 14,790 47,187 45,278
Income Before Income Taxes........................ 33,486 43,184 84,868 108,139
Income Tax Expense........................................ 4,555 10,692 12,891 26,019
Income from Continuing Operations............ 28,931 32,492 71,977 82,120
Income from Discontinued
Operations (net of tax)........................... - 11,497 67 7,201
Net Income ......................................................... $ 28,931 $ 43,989 $ 72,044 $ 89,321
Weighted Average Common Shares
Outstanding-Basic (000's)............................ 44,417 42,678 43,947 42,569
Weighted Average Common Shares
Outstanding-Diluted (000's).......................... 44,543 42,863 44,080 42,710
Earnings per Share of Common Stock (diluted):
Earnings per Share from Continuing Operations $ 0.65 $ 0.76 $ 1.63 $ 1.92
Earnings per Share from Discontinued Operations 0.00 0.27 0.00 0.17
Diluted Earnings per Share of Common Stock $ 0.65 $ 1.03 $ 1.63 $ 2.09
Dividends Paid per Share of Common Stock $ 0.30 $ 0.30 $ 0.90 $ 0.90
IDACORP, Inc.
Condensed Consolidated Statements of Cash Flows
For Nine Months Ended September 30, 2007 and 2006
Summary Financial Information
(unaudited)
(Thousands of Dollars)
Nine Months Ended
9/30/07 9/30/06
Operating Activities
Net Income................................................................. $ 72,044 $ 89,321
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization................................. 91,286 90,928
Deferred income taxes and investment tax credits.... 29,224 (16,467)
Changes in regulatory assets and liabilities.............. (110,813) 6,111
Undistributed earnings of subsidiaries...................... (4,648) (7,944)
Gain on sales of assets......................................... (4,437) (25,242)
Other non-cash adjustments to net income.............. 5,679 (2,592)
Change in:
Accounts receivable and prepayments.................. (9,703) 23,569
Accounts payable and other accrued liabilities...... (19,981) (14,252)
Taxes accrued................................................... (15,079) 2,720
Other................................................................. 13,628 23,696
Net cash provided by operating activities.................. 47,200 169,848
Investing Activities
Additions to property, plant and equipment.................... (203,067) (168,185)
Proceeds from the sale of ITI....................................... - 21,469
Proceeds from the sale of IDACOMM........................... 7,283 -
Investments in affordable housing.................................. 300 -
Proceeds from the sale of emission allowances............ 19,846 11,323
Investments in unconsolidated affiliates........................ (4,925) (15,370)
Purchase of available-for-sale securities....................... (24,349) (14,358)
Proceeds from the sale of available-for-sale securities... 26,110 16,404
Purchase of held-to-maturity securities........................ (3,116) (2,730)
Maturity of held-to-maturity securities.......................... 3,267 4,647
Other Assets.............................................................. (187) 617
Net cash used in investing activities........................ (178,838) (146,183)
Financing Activities
Issuance of long-term debt........................................... 140,000 -
Retirement of long-term debt......................................... (9,978) (10,993)
Dividends on common stock......................................... (39,629) (38,449)
Net change in short-term borrowings............................. 15,813 (27,410)
Issuance of common stock........................................... 34,893 9,174
Acquisition of treasury stock........................................ (346) (213)
Other.......................................................................... (2,355) 236
Net cash provided by (used in) financing activities..... 138,398 (67,655)
Net increase (decrease) in cash and cash equivalents.... 6,760 (43,990)
Cash and cash equivalents at beginning of period........... 9,892 52,356
Cash and cash equivalents at end of period.................... $ 16,652 $ 8,366
IDACORP, Inc.
Condensed Consolidated Balance Sheets
As of September 30, 2007 and December 31, 2006
Summary Financial Information
(unaudited)
(Thousands of Dollars)
9/30/07 12/31/06
Assets
Cash and cash equivalents.................................. $ 16,652 $ 9,892
Receivables, net of allowance.............................. 117,760 111,721
Employee notes................................................. 2,287 2,569
Energy marketing assets.................................... 1,829 12,069
Other current assets........................................... 153,089 126,954
Assets held for sale............................................ - 3,326
Total current assets......................................... 291,617 266,531
Investments....................................................... 201,532 202,825
Property, plant and equipment-net........................ 2,554,562 2,419,080
Regulatory assets.............................................. 454,120 423,548
Employee notes - long-term................................ 2,366 2,411
Other assets...................................................... 108,451 109,659
Assets held for sale............................................ - 21,076
Total other assets............................................ 564,937 556,694
Total Assets................................................ $ 3,612,648 $ 3,445,130
Liabilities and Shareholders' Equity
Current maturities of long-term debt...................... $ 92,368 $ 95,125
Notes payable.................................................... 144,813 129,000
Accounts payable............................................... 65,805 86,440
Energy marketing liabilities.................................. 1,973 13,532
Other current liabilities..................................... 79,555 83,631
Liabilities held for sale......................................... - 2,606
Total current liabilities...................................... 384,514 410,334
Deferred income taxes........................................ 486,006 498,512
Regulatory liabilities............................................ 276,086 294,844
Other liabilities................................................ 196,656 179,836
Liabilities held for sale......................................... - 8,773
Total other liabilities......................................... 958,748 981,965
Long-term debt................................................... 1,061,276 928,648
Shareholders' equity........................................... 1,208,110 1,124,183
Total Liabilities & Shareholders' Equity........... $ 3,612,648 $ 3,445,130
Idaho Power Company Supplemental Operating Statistics
Three Months Ended Nine Months Ended
9/30/07 9/30/06 9/30/07 9/30/06
Energy Use - MWh
Residential.................................. 1,300,632 1,249,496 3,831,797 3,688,983
Commercial................................. 1,076,755 1,008,865 2,959,011 2,794,180
Industrial..................................... 869,273 875,275 2,575,933 2,596,481
Irrigation...................................... 1,042,165 986,535 1,862,000 1,593,064
Total General Business................ 4,288,825 4,120,171 11,228,741 10,672,708
Off-System Sales......................... 620,255 790,435 2,110,459 5,076,917
Total........................................ 4,909,080 4,910,606 13,339,200 15,749,625
Revenue ($000's)
Residential.................................. $ 83,066 $ 72,550 $ 224,534 $ 224,992
Commercial................................. 50,481 41,700 126,671 125,241
Industrial..................................... 28,875 24,055 74,269 80,947
Irrigation...................................... 49,451 41,106 85,863 69,623
Total General Business................ 211,873 179,411 511,337 500,803
Off-System Sales......................... 34,843 39,692 129,858 219,531
Total........................................ $ 246,716 $ 219,103 $ 641,195 $ 720,334
Customers - Period End
Residential.................................. 398,883 390,380
Commercial................................. 62,209 59,389
Industrial..................................... 127 130
Irrigation...................................... 18,134 18,230
