EXHIBIT (99)
[CMS ENERGY LOGO] NEWS RELEASE
CMS ENERGY ANNOUNCES SECOND QUARTER NET LOSS OF $45 MILLION, OR
$0.31 PER SHARE, ASSOCIATED WITH PLANNED ASSET SALES;
REAFFIRMS ONGOING EARNINGS GUIDANCE
JACKSON, Mich., Aug. 12, 2003 -- CMS Energy (NYSE: CMS) announced a reported net
loss of $45 million, or $0.31 per share, for the second quarter of 2003, an
improvement over the same quarter of 2002, when it reported a net loss of $74
million, or $0.55 per share. Charges linked to the sale of the CMS Panhandle
Companies made up the bulk of the reported quarterly loss.
Ongoing (non-Generally Accepted Accounting Principles) net income for the second
quarter was $1 million, or $0.01 per share, compared to ongoing net income of
$17 million or $0.13 per share in the same period of 2002. Ongoing earnings
provide a key measure of the Company's present operating financial performance,
unaffected by discontinued operations, asset sales, accounting changes or other
items detailed in the attached summary financial statements.
Compared to last year, the 2003 second quarter ongoing results reflect benefits
from favorable movement in foreign exchange rates and higher non-regulated
business earnings, which were more than offset by higher financing costs and
reduced electric sales at CMS Energy's principal subsidiary, Consumers Energy.
Temperatures for the spring and early summer averaged about 2 degrees lower than
the similar period last year and as a result electric sales were down 4 percent.
The higher financing costs reflect the $925 million in bridge financing that CMS
Energy completed in April.
For the first six months of 2003, CMS Energy reported net income of $34 million,
or $0.24 per share, up from a loss of $32 million, or $0.24 per share, for the
first half of 2002. Ongoing income was $79 million, or $0.55 per share, compared
to $96 million, or $0.72 per share, for the same period in 2002.
Despite the continuing impact of cooler weather, the Company reaffirmed its
full-year earnings guidance of $0.80 to $0.90 per share on an ongoing basis,
citing continued aggressive cost management. The Company adjusted its guidance
for full-year reported earnings from roughly break even to a loss of about $1
per share, principally because of changes in the timing of asset sales, the
expected proceeds from those sales, pension expenses linked to the CMS Panhandle
Companies sale, and increased financing costs.
CMS Energy continues to make progress on its financial plan, reaching milestones
during the second quarter and early July that include:
o Closing more than $2 billion in asset sales
o CMS Panhandle for $1.8 billion, including $1.2
billion in assumed debt
o CMS Field Services for $113 million and a $50
million contingent note
o CMS's Guardian pipeline interest for $26 million
o Atacama transmission lines for $38 million
o Completing $2.25 billion in financings at CMS Energy and
Consumers Energy to extend maturities and reduce interest
costs
o At CMS Energy
- $925 million in bridge bank financing
- $300 million of 7.75 percent, seven-year
senior debt
- $150 million of 3.375 percent convertible
debt
o At Consumers Energy
- $875 million in first mortgage bonds with
five- to 10-year maturities and interest
rates of 4 percent to 5.375 percent
o Consumers Energy ranked second nationally in customer
satisfaction for combined electric and gas utilities in an
annual survey by the American Customer Satisfaction Index.
Ken Whipple, CMS Energy's chairman and chief executive officer, said the latest
financial statements show the Company is continuing to make progress in
executing its back-to-basics strategy.
"We've got a solid business plan and it continues to show results. We're doing
what we said we were going to do: increase our financial flexibility and
liquidity and implement our back-to-basics strategy," Whipple said. "Our $2.25
billion in recent financings are an important part of our financial plan. They
allowed us to extend maturities and capitalize on some low-interest rate
opportunities. There are still many challenges ahead, but we continue to make
progress toward our goal of becoming a smaller, stronger company."
CMS Energy is an integrated energy company, which has as its primary business
operations an electric and natural gas utility, natural gas pipeline systems,
and independent power generation.
# # #
For more information on CMS Energy, please visit our web site at:
www.cmsenergy.com
Media Contacts: Jeff Holyfield, 517-788-2394, or Dan Bishop, 517/788-2395
Investment Analyst Contact: CMS Energy Investor Relations, 517/788-2590
This news release contains "forward-looking statements" within the meaning of
the safe harbor provisions of the federal securities laws. It should be read in
conjunction with the forward-looking statements cautionary factors in CMS
Energy's Securities and Exchange Commission filings that identify important
factors that could cause CMS Energy's results to differ materially from those
anticipated in such statements.
CMS Energy Corporation
SUMMARY OF CONSOLIDATED EARNINGS
Condensed Consolidated Income Statements
(Millions, Except Per Share Amounts)
Second Quarter First Half
(Unaudited) (Unaudited)
------------------------ ----------------------
2003 2002 2003 2002
---------- ---------- ---------- ----------
OPERATING REVENUE $ 1,154 $ 2,135 $ 3,143 $ 4,394
Operating Expenses 971 1,983 2,722 3,968
---------- ---------- ---------- ----------
OPERATING INCOME $ 183 $ 152 $ 421 $ 426
Other Income (Deductions) (1) 18 (3) 32
Fixed Charges 153 127 272 254
Income Taxes 34 6 74 74
Minority Interests - 1 1 1
---------- ---------- ---------- ----------
INCOME (LOSS) FROM CONTINUING OPERATIONS $ (5) $ 36 $ 71 $ 129
INCOME (LOSS) FROM DISCONTINUED OPERATIONS (40) (127) (13) (178)
CUMULATIVE EFFECT OF ACCOUNTING CHANGES - 17 (24) 17
---------- ---------- ---------- ----------
NET INCOME (LOSS) $ (45) $ (74) $ 34 $ (32)
========== ========== ========== ==========
EARNINGS (LOSS) PER SHARE
- BASIC $ (0.31) $ (0.55) $ 0.24 $ (0.24)
- DILUTED (0.31) (0.55) 0.24 (0.24)
CMS Energy Corporation
SUMMARIZED COMPARATIVE BALANCE SHEETS
(Millions of Dollars)
As of June 30 (Unaudited) December 31
------------------------- -----------
2003 2002 2002
---------- ---------- ----------
ASSETS
Cash and cash equivalents $ 931 $ 222 $ 377
Other current assets 2,104 1,975 2,371
---------- ---------- ----------
Total current assets $ 3,035 $ 2,197 $ 2,748
Net plant and property 5,740 5,506 5,230
Investments 1,456 1,596 1,393
Non-current assets 2,797 5,288 4,544
---------- ---------- ----------
Total Assets $ 13,028 $ 14,587 $ 13,915
========== ========== ==========
STOCKHOLDERS' INVESTMENT
AND LIABILITIES
Capitalization
Debt
Long-term debt (excluding
Securitization) $ 5,643 $ 4,924 $ 4,930
Capital leases 120 97 116
Short-term 1 269 458
Current portion of long-term
debt and capital leases 514 613 613
---------- ---------- ----------
Total debt $ 6,278 $ 5,903 $ 6,117
Preferred stock and securities 927 1,228 927
Minority interest 23 13 21
Common stockholders' equity 1,199 1,552 1,133
---------- ---------- ----------
Total capitalization $ 8,427 $ 8,696 $ 8,198
Securitization debt 439 469 453
Current liabilities 1,171 1,974 1,800
Non-current liabilities 2,991 3,448 3,464
---------- ---------- ----------
Total Stockholders' Investment and Liabilities $ 13,028 $ 14,587 $ 13,915
========== ========== ==========
CMS Energy Corporation
SUMMARY OF CONSOLIDATED EARNINGS
Reconciliations of GAAP Net Income (Loss) to Non-GAAP Ongoing Net Income (Loss)
(Millions, Except Per Share Amounts)
Second Quarter First Half
(Unaudited) (Unaudited)
------------------------ -----------------------
2003 2002 2003 2002
---------- ---------- ---------- ----------
NET INCOME (LOSS) $ (45) $ (74) $ 34 $ (32)
Reconciling Items:
Discontinued Operations (Income) Loss 40 127 13 178
Cumulative Effect of Accounting Changes:
EITF #02-03 MTM Accounting - - 23 -
SFAS No. 143 Asset Retirement Obligation - - 1 -
SFAS No. 133 Derivative Accounting - (17) - (17)
Net Asset (Gain)/Loss and Other 6 (19) 8 (33)
---------- ---------- ---------- ----------
Ongoing Net Income (Loss) - Non-GAAP Basis $ 1 $ 17 $ 79 $ 96
========== ========== ========== ==========
Average Number of Common Shares Outstanding
Basic 144 135 144 134
Diluted 165 139 165 138
BASIC EARNINGS (LOSS) PER AVERAGE COMMON SHARE
Earnings (Loss) Per Share As Reported $ (0.31) (0.55) $ 0.24 $ (0.24)
Reconciling Items:
Discontinued Operations (Income) Loss 0.28 0.94 0.09 1.32
Cumulative Effect of Accounting Changes:
EITF #02-03 MTM Accounting - - 0.15 -
SFAS No. 143 Asset Retirement Obligations - - 0.01 -
SFAS No. 133 Derivative Accounting - (0.12) - (0.12)
Net Asset (Gain)/Loss and Other 0.04 (0.14) 0.06 (0.24)
---------- ---------- ---------- ----------
Ongoing Net Income (Loss) - Non-GAAP Basis $ 0.01 $ 0.13 $ 0.55 $ 0.72
========== ========== ========== ==========
DILUTED EARNINGS (LOSS) PER AVERAGE COMMON SHARE
Earnings (Loss) Per Share As Reported (0.31) (0.55) $ 0.24 $ (0.24)
Reconciling Items:
Discontinued Operations (Income) Loss 0.28 0.94 0.09 1.32
Cumulative Effect of Accounting Changes:
EITF #02-03 MTM Accounting - - 0.15 -
SFAS No. 143 Asset Retirement Obligations - - 0.01 -
SFAS No. 133 Derivative Accounting - (0.12) - (0.12)
Net Asset (Gain)/Loss and Other 0.04 (0.14) 0.06 (0.24)
---------- ---------- ---------- ----------
Ongoing Net Income (Loss) - Non-GAAP Basis $ 0.01 $ 0.13 $ 0.55 $ 0.72
========== ========== ========== ==========