(CENTERPOINT ENERGY LOGO) For more information contact
MEDIA:
LETICIA LOWE
Phone 713.207.7702
INVESTORS:
MARIANNE PAULSEN
Phone 713.207.6500
FOR IMMEDIATE RELEASE Page 1 of 5
- --------------------------------------------------------------------------------
CENTERPOINT ENERGY REPORTS FOURTH QUARTER AND
FULL YEAR 2005 EARNINGS
HOUSTON, TX - FEBRUARY 28, 2006 - CenterPoint Energy, Inc. (NYSE:
CNP) today reported net income of $81 million, or $0.25 per diluted share, for
the fourth quarter of 2005 compared to $100 million, or $0.29 per diluted share
for the same period of 2004. For the year 2005, the company recorded net income
of $252 million, or $0.75 per diluted share, compared to a net loss of $905
million, or $2.48 per diluted share, for 2004.
Net income for 2004 included a $977 million extraordinary loss from the
write-down of generation-related regulatory assets as a result of actions taken
by the Texas Public Utility Commission (PUC), $83 million of this amount was
recorded in the fourth quarter. Net income for 2004 also included a $133 million
overall loss from discontinued operations, although there was a $21 million gain
from discontinued operations recorded in the fourth quarter of 2004. Net income
for 2005 included a $30 million positive adjustment to the 2004 write-down of
generation-related regulatory assets, and a $3 million loss from discontinued
operations.
Income from continuing operations before extraordinary item for the
fourth quarter of 2005 was $81 million, or $0.25 per diluted share, compared to
$162 million, or $0.46 per diluted share, for the fourth quarter of 2004. Income
from continuing operations before extraordinary item for the year 2005 was $225
million, or $0.67 per diluted share, compared to $205 million, or $0.61 per
diluted share, for 2004. As a result of actions taken by the PUC, in the fourth
quarter of 2004 the company recorded pre-tax income of $226 million related to
interest on the company's authorized true-up balance. Of this amount, $131
million related to 2004 ($36 million related to the fourth quarter of 2004) and
$95 million related to periods prior to 2004.
"I am very pleased with our overall progress and accomplishments in
2005," said David M. McClanahan, president and chief executive officer of
CenterPoint Energy. "2005 was a year of significant milestones for our company,
marking the end to our transition. We completed the sale of our power generation
business and began to recover our authorized true-up balance through the
implementation of a competition transition charge and the issuance of $1.85
billion of transition bonds. We repaid our high-cost $1.31 billion term loan,
reduced other debt and restructured our credit facilities to reduce interest
costs, extend maturities and improve terms. Now that our transition is behind
us, we look forward to further improving our operating performance while we
explore opportunities to grow in a disciplined manner."
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(CENTERPOINT ENERGY LOGO) For more information contact
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MARIANNE PAULSEN
Phone 713.207.6500
FOR IMMEDIATE RELEASE Page 2 of 5
- --------------------------------------------------------------------------------
OPERATING INCOME BY SEGMENT DETAILED
ELECTRIC TRANSMISSION & DISTRIBUTION
The electric transmission & distribution segment generated operating
income of $102 million in the fourth quarter of 2005, consisting of $90 million
for the regulated electric transmission & distribution utility (TDU) and $12
million for the transition bond companies, which is an amount sufficient to pay
interest on the transition bonds. Operating income for the fourth quarter of
2004 totaled $104 million, consisting of $95 million for the TDU and $9 million
for the transition bond company.
Revenues increased in the fourth quarter of 2005 primarily due to
continued customer growth with the addition of over 60,000 metered customers
since December 2004, increased customer usage and the implementation of a
competition transition charge (CTC) in September 2005. Operating expenses
increased primarily due to higher transmission costs, labor and benefit-related
expenses, tree trimming expenses, and increased franchise fees paid to the City
of Houston under a new 30-year franchise agreement.
Operating income for the year 2005 was $487 million, consisting of
$448 million for the TDU and $39 million for the transition bond companies.
Operating income for 2004 totaled $494 million, consisting of $441 million for
the TDU, $38 million for the transition bond company, and a $15 million reversal
of a reserve related to the final fuel reconciliation of the former integrated
utility recorded in the fourth quarter of 2004.
For the year 2005, revenues increased primarily due to continued
customer growth, increased customer usage driven by warmer weather, higher
transmission cost recovery and implementation of the CTC. Operating expenses
increased primarily due to higher transmission costs, labor and benefit-related
expenses, tree trimming expenses, depreciation and amortization, and the
increased franchise fees paid to the City of Houston. Operating expenses for
2004 reflected an $11 million credit from a land sale.
NATURAL GAS DISTRIBUTION
Beginning with the fourth quarter of 2005, the natural gas distribution
segment excludes the company's non-rate regulated natural gas sales and services
business, which is now reported as a separate segment, "competitive natural gas
sales and services". All prior period segment information has been reclassified
to conform to the 2005 presentation.
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(CENTERPOINT ENERGY LOGO) For more information contact
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Phone 713.207.6500
FOR IMMEDIATE RELEASE Page 3 of 5
- --------------------------------------------------------------------------------
The natural gas distribution segment reported operating income of $59
million for the fourth quarter of 2005, compared to $69 million for the same
period of 2004. Higher margins from the addition of nearly 44,000 customers
since December 2004 were more than offset by increased litigation reserves and
increased bad debt expense associated with higher natural gas prices.
Operating income for the year 2005 was $175 million compared to $178
million for 2004. The benefits from rate increases and customer growth were more
than offset by reduced customer usage, increased bad debt expense and litigation
reserves, and higher depreciation. In 2004, operating expenses reflected
severance and associated benefit-related expenses due to an organizational
restructuring.
COMPETITIVE NATURAL GAS SALES AND SERVICES
The competitive natural gas sales and services business is engaged in
the sale of natural gas and related services primarily to commercial and
industrial customers and electric and gas utility companies.
This segment reported operating income of $30 million for the fourth
quarter of 2005, compared to $16 million for the same period of 2004. The
increase was primarily attributable to higher sales to utilities and favorable
basis differentials across the pipeline capacity that the company controls.
Operating income for the year 2005 was $60 million compared to $44
million for 2004. The increase was primarily attributable to the same items
noted above. Partially offsetting the margin increase were the effects of
mark-to-market accounting related to non-trading financial derivatives used to
lock in economic margins of certain forward gas sales, as well as increased
employee-related and bad debt expenses.
PIPELINES AND FIELD SERVICES
The pipelines and field services segment reported operating income of
$67 million for the fourth quarter of 2005 compared to $57 million for the same
period of 2004. Within this segment, the pipeline business achieved higher
operating income ($46 million vs. $42 million) driven by increased demand for
transportation resulting from basis differentials across the system and higher
demand for ancillary services. The field services business achieved higher
operating income ($21 million vs. $15 million) driven by increased throughput
and demand, increased gas gathering and ancillary services, and higher commodity
prices.
-more-
(CENTERPOINT ENERGY LOGO) For more information contact
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Phone 713.207.6500
FOR IMMEDIATE RELEASE Page 4 of 5
- --------------------------------------------------------------------------------
Operating income for the year 2005 was $235 million compared to $180
million for 2004. Operating income for the pipeline business for 2005 was $165
million compared to $129 million for 2004. The field services business recorded
operating income of $70 million for 2005 compared to $51 million for 2004. The
improvements in operating income for the year resulted primarily from the same
items noted for the quarter.
OTHER OPERATIONS
The company's other operations reported an operating loss of $6 million
for the fourth quarter of 2005 compared to a loss of $15 million for the same
period of 2004. The operating loss for the year 2005 was $18 million compared to
a loss of $32 million for 2004.
OTHER 2005 EVENTS
Additional significant events for CenterPoint Energy during 2005 included:
o completion of the sale of the company's generation assets; proceeds of
$2.231 billion and $700 million were received in 2004 and 2005,
respectively;
o issuance of over $1.85 billion in transition bonds to recover a portion of
the company's authorized true-up balance;
o implementation of a CTC to begin recovering the remaining authorized
true-up balance of $596 million over 14 years, plus interest;
o contribution of $75 million to the pension plan in 2005 following a $476
million pension plan contribution in 2004; and
o completion of an exchange offer for $572 million of the company's 3.75
percent convertible senior notes.
DIVIDEND DECLARATION
On January 26, 2006, CenterPoint Energy's board of directors declared a
regular quarterly cash dividend of $0.15 per share of common stock payable on
March 10, 2006, to shareholders of record as of the close of business on
February 16, 2006. In declaring this dividend, the board of directors indicated
its intent to return to the company's traditional practice of paying consistent
quarterly dividends. An annualized dividend based on a $0.15 per common share
quarterly dividend represents a 50 percent increase over the $0.40 per common
share in total dividends paid by the company in 2005.
-more-
(CENTERPOINT ENERGY LOGO) For more information contact
MEDIA:
LETICIA LOWE
Phone 713.207.7702
INVESTORS:
MARIANNE PAULSEN
Phone 713.207.6500
FOR IMMEDIATE RELEASE Page 5 of 5
- --------------------------------------------------------------------------------
OUTLOOK FOR 2006
CenterPoint Energy expects diluted earnings per share for 2006 to be in
the range of $0.90 to $1.00. This guidance excludes any impacts related to the
company's Zero-Premium Exchangeable Subordinated Notes (ZENS) and associated
federal income tax consequences due to the uncertainties associated with the
resolution of the ongoing dispute with the Internal Revenue Service. This
guidance takes into consideration various economic and operational assumptions
related to the business segments in which it operates. In particular, the
company has made certain assumptions regarding the impact to earnings of various
regulatory proceedings but cannot predict the ultimate outcome of any of those
proceedings. In providing this guidance, the company has not projected the
impact of any potential changes in accounting standards, any impact from
acquisitions or divestitures, or the outcome of pending legal proceedings
related to the company's true up appeal.
WEBCAST OF EARNINGS CONFERENCE CALL
CenterPoint Energy's management will host an earnings conference call
on Tuesday, February 28, 2006, at 10:30 a.m. Central time or 11:30 a.m. Eastern
time. Interested parties may listen to a live, audio broadcast of the conference
call at www.CenterPointEnergy.com/investors/events. A replay of the call can be
accessed approximately two hours after the completion of the call, and will be
archived on the web site for at least one year.
CenterPoint Energy, Inc., headquartered in Houston, Texas, is a
domestic energy delivery company that includes electric transmission &
distribution, natural gas distribution and sales, and interstate pipeline and
gathering operations. The company serves nearly five million metered customers
primarily in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma, and Texas.
Assets total approximately $17 billion. With approximately 9,000 employees,
CenterPoint Energy and its predecessor companies have been in business for more
than 130 years. For more information, visit the Web site at
www.CenterPointEnergy.com.
This news release includes forward-looking statements. Actual events
and results may differ materially from those projected. The statements in this
news release regarding future financial performance and results of operations
and other statements that are not historical facts are forward-looking
statements. Factors that could affect actual results include the timing and
outcome of appeals from the true-up proceedings, the timing and impact of future
regulatory and legislative decisions, effects of competition, weather
variations, changes in CenterPoint Energy's or its subsidiaries' business plans,
financial market conditions, the timing and extent of changes in commodity
prices, particularly natural gas, the impact of unplanned facility outages and
other factors discussed in CenterPoint Energy's and its subsidiaries' Form 10-Ks
for the period ended December 31, 2004, Form 10-Qs for the periods ended March
31, 2005, June 30, 2005 and September 30, 2005, and other filings with the
Securities and Exchange Commission.
- ### -
CenterPoint Energy, Inc. and Subsidiaries
Statements of Consolidated Operations
(Millions of Dollars)
(Unaudited)
Quarter Ended December 31, Twelve Months Ended December 31,
-------------------------------- --------------------------------
2004 2005 2004 2005
------------- ------------- ------------- -------------
Revenues:
Electric Transmission & Distribution $ 368 $ 401 $ 1,521 $ 1,644
Natural Gas Distribution 1,184 1,441 3,579 3,846
Competitive Natural Gas Sales and Services 873 1,346 2,848 4,129
Pipelines and Field Services 127 131 451 493
Other Operations - 4 8 19
Eliminations (115) (111) (408) (409)
------------- ------------- ------------- -------------
Total 2,437 3,212 7,999 9,722
------------- ------------- ------------- -------------
Expenses:
Natural gas 1,647 2,348 5,013 6,509
Operation and maintenance 345 384 1,277 1,358
Depreciation and amortization 128 130 490 541
Taxes other than income taxes 86 98 355 375
------------- ------------- ------------- -------------
Total 2,206 2,960 7,135 8,783
------------- ------------- ------------- -------------
Operating Income 231 252 864 939
------------- ------------- ------------- -------------
Other Income (Expense):
Gain (loss) on Time Warner investment 71 (15) 31 (44)
Gain (loss) on indexed debt securities (63) 15 (20) 49
Interest and other finance charges (185) (149) (739) (670)
Interest on transition bonds (9) (13) (38) (40)
Return on true-up balance 226 17 226 121
Other - net 5 5 20 23
------------- ------------- ------------- -------------
Total 45 (140) (520) (561)
------------- ------------- ------------- -------------
Income from Continuing Operations Before
Income Taxes and Extraordinary Item 276 112 344 378
Income Tax Expense (114) (31) (139) (153)
------------- ------------- ------------- -------------
Income from Continuing Operations Before
Extraordinary Item 162 81 205 225
------------- ------------- ------------- -------------
Discontinued Operations:
Income from Texas Genco, net of tax 53 - 294 11
Minority Interest related to Texas Genco, net of tax (12) - (61) -
Loss on Disposal of Texas Genco, net of tax (20) - (366) (14)
------------- ------------- ------------- -------------
Total 21 - (133) (3)
------------- ------------- ------------- -------------
Income Before Extraordinary Item 183 81 72 222
------------- ------------- ------------- -------------
Extraordinary Item, net of tax (83) - (977) 30
------------- ------------- ------------- -------------
Net Income (Loss) $ 100 $ 81 $ (905) $ 252
============= ============= ============= =============
Reference is made to the Notes to the Consolidated Financial Statements
contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries
Selected Data From Statements of Consolidated Operations
(Millions of Dollars, Except Share and Per Share Amounts)
(Unaudited)
Quarter Ended Twelve Months Ended
December 31, December 31,
-------------------------- --------------------------
2004 2005 2004 2005
---------- ---------- ---------- ----------
Basic Earnings (Loss) Per Common Share:
Income from Continuing Operations $ 0.53 $ 0.26 $ 0.67 $ 0.72
Income (Loss) from Discontinued Operations 0.07 - (0.43) (0.01)
Extraordinary Item, net of tax (0.27) - (3.18) 0.10
---------- ---------- ---------- ----------
Net Income (Loss) $ 0.33 $ 0.26 $ (2.94) $ 0.81
========== ========== ========== ==========
Diluted Earnings (Loss) Per Common Share:
Income from Continuing Operations $ 0.46 $ 0.25 $ 0.61 $ 0.67
Income (Loss) from Discontinued Operations 0.06 - (0.37) (0.01)
Extraordinary Item, net of tax (0.23) - (2.72) 0.09
---------- ---------- ---------- ----------
Net Income (Loss) $ 0.29 $ 0.25 $ (2.48) $ 0.75
========== ========== ========== ==========
Dividends Declared per Common Share $ 0.10 $ 0.06 $ 0.40 $ 0.40
Weighted Average Common Shares Outstanding (000):
- Basic 307,876 310,147 307,185 309,349
- Diluted 360,205 320,351 359,506 346,028
OPERATING INCOME (LOSS) BY SEGMENT
Electric Transmission & Distribution:
Transmission & Distribution Operations $ 95 $ 90 $ 456 $ 448
Transition Bond Companies 9 12 38 39
---------- ---------- ---------- ----------
Total Electric Transmission & Distribution 104 102 494 487
Natural Gas Distribution 69 59 178 175
Competitive Natural Gas Sales and Services 16 30 44 60
Pipelines and Field Services 57 67 180 235
Other Operations (15) (6) (32) (18)
---------- ---------- ---------- ----------
Total $ 231 $ 252 $ 864 $ 939
========== ========== ========== ==========
Reference is made to the Notes to the Consolidated Financial Statements
contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries
Results of Operations by Segment
(Millions of Dollars)
(Unaudited)
ELECTRIC TRANSMISSION & DISTRIBUTION
--------------------------------------------------------------------
Quarter Ended Twelve Months Ended
December 31, December 31,
---------------- % Diff ---------------------- % Diff
2004 2005 Fav/(Unfav) 2004 2005 Fav/(Unfav)
------- ------- ----------- ---------- ---------- -----------
RESULTS OF OPERATIONS:
Revenues:
Electric transmission and distribution utility $ 347 $ 374 8% $ 1,446 $ 1,538 6%
Transition bond companies 21 27 29% 75 106 41%
------- ------- ---------- ----------
Total 368 401 9% 1,521 1,644 8%
------- ------- ---------- ----------
Expenses:
Operation and maintenance 145 172 (19%) 539 618 (15%)
Depreciation and amortization 62 61 2% 248 258 (4%)
Taxes other than income taxes 45 51 (13%) 203 214 (5%)
Transition bond companies 12 15 (25%) 37 67 (81%)
------- ------- ---------- ----------
Total 264 299 (13%) 1,027 1,157 (13%)
------- ------- ---------- ----------
Operating Income - Electric transmission
and distribution utility 95 90 (5%) 456 448 (2%)
Operating Income - Transition bond companies 9 12 33% 38 39 3%
------- ------- ---------- ----------
Total Segment Operating Income $ 104 $ 102 (2%) $ 494 $ 487 (1%)
======= ======= ========== ==========
ELECTRIC TRANSMISSION & DISTRIBUTION Quarter Ended Twelve Months Ended
OPERATING DATA: December 31, December 31,
----------------------- -------------------------
2004 2005 2004 2005
---------- ---------- ---------- ----------
ACTUAL MWH DELIVERED
Residential 5,033,574 5,317,080 6% 23,747,996 24,923,995 5%
Total 16,997,828 17,055,414 - 73,631,547 74,189,448 1%
WEATHER (AVERAGE FOR SERVICE AREA):
Percentage of normal:
Cooling degree days 146% 128% (18%) 107% 112% 5%
Heating degree days 75% 91% 16% 82% 82% -
AVERAGE NUMBER OF METERED CUSTOMERS:
Residential 1,656,281 1,704,690 3% 1,639,488 1,683,100 3%
Total 1,881,761 1,936,685 3% 1,862,853 1,912,346 3%
NATURAL GAS DISTRIBUTION
------------------------------------------------------------------------------
Quarter Ended Twelve Months Ended
December 31, December 31,
----------------------- % Diff ----------------------- % Diff
2004 2005 Fav/(Unfav) 2004 2005 Fav/(Unfav)
---------- ---------- ----------- ---------- ---------- -----------
RESULTS OF OPERATIONS:
Revenues $ 1,184 $ 1,441 22% $ 3,579 $ 3,846 7%
---------- ---------- ---------- ----------
Expenses:
Natural gas 904 1,148 (27%) 2,596 2,841 (9%)
Operation and maintenance 143 158 (10%) 544 551 (1%)
Depreciation and amortization 36 37 (3%) 141 152 (8%)
Taxes other than income taxes 32 39 (22%) 120 127 (6%)
---------- ---------- ---------- ----------
Total 1,115 1,382 (24%) 3,401 3,671 (8%)
---------- ---------- ---------- ----------
Operating Income $ 69 $ 59 (14%) $ 178 $ 175 (2%)
========== ========== ========== ==========
NATURAL GAS DISTRIBUTION OPERATING DATA:
THROUGHPUT DATA IN BCF
Residential 55 53 (4%) 175 160 (9%)
Commercial and Industrial 65 57 (12%) 237 215 (9%)
---------- ---------- ---------- ----------
Total Throughput 120 110 (8%) 412 375 (9%)
========== ========== ========== ==========
WEATHER (AVERAGE FOR SERVICE AREA)
Percentage of normal:
Heating degree days 88% 94% 6% 92% 91% (1%)
AVERAGE NUMBER OF CUSTOMERS:
Residential 2,817,670 2,855,670 1% 2,798,210 2,838,357 1%
Commercial and Industrial 246,581 245,925 - 246,068 246,372 -
---------- ---------- ---------- ----------
Total 3,064,251 3,101,595 1% 3,044,278 3,084,729 1%
========== ========== ========== ==========
Reference is made to the Notes to the Consolidated Financial Statements
contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries
Results of Operations by Segment
(Millions of Dollars)
(Unaudited)
COMPETITIVE NATURAL GAS SALES AND SERVICES
----------------------------------------------------------------------
Quarter Ended Twelve Months Ended
December 31, December 31,
------------------ % Diff ------------------- % Diff
2004 2005 Fav/(Unfav) 2004 2005 Fav/(Unfav)
------- ------ ----------- ------- -------- -----------
RESULTS OF OPERATIONS:
Revenues $ 873 $1,346 54% $2,848 $4,129 45%
------ ------ ------ ------
Expenses:
Natural gas 849 1,305 (54%) 2,778 4,033 (45%)
Operation and maintenance 7 9 (29%) 22 30 (36%)
Depreciation and amortization 1 1 -- 2 2 --
Taxes other than income taxes -- 1 -- 2 4 (100%)
------ ------ ------ ------
Total 857 1,316 (54%) 2,804 4,069 (45%)
------ ------ ------ ------
Operating Income $ 16 $ 30 88% $ 44 $ 60 36%
====== ====== ====== ======
COMPETITIVE NATURAL GAS SALES AND SERVICES OPERATING DATA:
THROUGHPUT DATA IN BCF
Wholesale - third parties 71 69 (3%) 228 304 33%
Wholesale - affiliates 9 4 (56%) 35 27 (23%)
Retail 41 44 7% 141 156 11%
Pipeline 19 10 (47%) 76 51 (33%)
------ ------ ------ ------
Total Throughput 140 127 (9%) 480 538 12%
====== ====== ====== ======
AVERAGE NUMBER OF CUSTOMERS:
Wholesale 102 121 19% 97 138 42%
Retail 6,003 6,616 10% 5,976 6,328 6%
Pipeline 169 135 (20%) 172 142 (17%)
------ ------ ------ ------
Total 6,274 6,872 10% 6,245 6,608 6%
====== ====== ====== ======
PIPELINES AND FIELD SERVICES
-------------------------------------------------------------------------
Quarter Ended Twelve Months Ended
December 31, December 31,
-------------------- % Diff -------------------- % Diff
2004 2005 Fav/(Unfav) 2004 2005 Fav/(Unfav)
------- ------- ----------- ------- ------- ----------
RESULTS OF OPERATIONS:
Revenues $ 127 $ 131 3% $ 451 $ 493 9%
------- ------- ------- -------
Expenses:
Natural gas 13 5 62% 46 30 35%
Operation and maintenance 42 43 (2%) 164 164 --
Depreciation and amortization 11 11 -- 44 45 (2%)
Taxes other than income taxes 4 5 (25%) 17 19 (12%)
------- ------- ------- -------
Total 70 64 9% 271 258 5%
------- ------- ------- -------
Operating Income $ 57 $ 67 18% $ 180 $ 235 31%
======= ======= ======= =======
PIPELINES AND GATHERING OPERATING DATA:
THROUGHPUT DATA IN BCF
Natural Gas Sales 3 2 (33%) 11 6 (45%)
Transportation 201 214 6% 859 914 6%
Gathering 88 91 3% 321 353 10%
Elimination (2) -- -- (7) (4) 43%
------- ------- ------- -------
Total Throughput 290 307 6% 1,184 1,269 7%
======= ======= ======= =======
Reference is made to the Notes to the Consolidated Financial Statements
contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries
Results of Operations by Segment
(Millions of Dollars)
(Unaudited)
OTHER OPERATIONS
-------------------------------------------------------------------------------
Quarter Ended Twelve Months Ended
December 31, December 31,
---------------------- % Diff ---------------------- % Diff
2004 2005 Fav/(Unfav) 2004 2005 Fav/(Unfav)
-------- -------- ----------- -------- -------- -----------
RESULTS OF OPERATIONS:
Revenues $ -- $ 4 -- $ 8 $ 19 138%
Expenses 15 10 33% 40 37 8%
-------- -------- -------- --------
Operating Loss $ (15) $ (6) 60% $ (32) $ (18) 44%
======== ======== ======== ========
Capital Expenditures by Segment
(Millions of Dollars)
(Unaudited)
Quarter Ended Twelve Months Ended
December 31, December 31,
--------------------- ---------------------
2004 2005 2004 2005
-------- -------- -------- --------
CAPITAL EXPENDITURES BY SEGMENT
Electric Transmission & Distribution $ 62 $ 82 $ 235 $ 281
Natural Gas Distribution 65 80 196 249
Competitive Natural Gas Sales and Services -- 8 1 12
Pipelines and Field Services 35 48 73 156
Other Operations 9 4 25 21
-------- -------- -------- --------
Total $ 171 $ 222 $ 530 $ 719
======== ======== ======== ========
Interest Expense Detail
(Millions of Dollars)
(Unaudited)
Quarter Ended Twelve Months Ended
December 31, December 31,
---------------------- ----------------------
2004 2005 2004 2005
-------- -------- -------- --------
INTEREST EXPENSE DETAIL
Amortization of Deferred Financing Cost $ 29 $ 17 $ 92 $ 76
Capitalization of Interest Cost (1) (1) (4) (4)
Transition Bond Interest Expense 9 13 37 39
Other Interest Expense 157 133 652 599
-------- -------- -------- --------
Total Interest Expense 194 162 777 710
-------- -------- -------- --------
Amortization of Deferred Financing Cost
Reclassified to Discontinued Operations 16 -- 19 --
Other Interest Reclassified to Discontinued Operations 18 -- 53 --
-------- -------- -------- --------
Total Interest Reclassified to Discontinued Operations (1) 34 -- 72 --
Interest Expense Incurred by Discontinued Operations -- -- -- 1
-------- -------- -------- --------
Total Expense in Discontinued Operations 34 -- 72 1
-------- -------- -------- --------
Total Interest Expense Incurred $ 228 $ 162 $ 849 $ 711
======== ======== ======== ========
(1) In accordance with Emerging Issues Task Force Issue No. 87-24 "Allocation of
Interest to Discontinued Operations", in 2004, we have reclassified interest to
discontinued operations of Texas Genco based on net proceeds received from the
sale of Texas Genco of $2.5 billion, and have applied the proceeds to the amount
of debt assumed to be paid down in 2004 according to the terms of the respective
credit facilities in effect for that period. In periods where only the term loan
was assumed to be repaid, the actual interest paid was reclassified. In periods
where a portion of the revolver was assumed to be repaid, the percentage of that
portion of the revolver to the total outstanding balance was calculated, and
that percentage was applied to the actual interest paid in those periods to
compute the amount of interest reclassified.
Total interest expense was $228 million and $162 million for the three months
ended December 31, 2004 and 2005, respectively, and $849 million and $711
million for the year ended December 31, 2004 and 2005, respectively. Interest
expense of $34 million for the three months ended December 31, 2004, and $72
million for the year ended December 31, 2004, was reclassified to discontinued
operations of Texas Genco.
Reference is made to the Notes to the Consolidated Financial Statements
contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets
(Millions of Dollars)
(Unaudited)
December 31, December 31,
2004 2005
------------ ------------
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 165 $ 74
Other current assets 2,092 2,817
Current assets of discontinued operations 514 --
------------ ------------
Total current assets 2,771 2,891
------------ ------------
PROPERTY, PLANT AND EQUIPMENT, NET 8,186 8,492
------------ ------------
OTHER ASSETS:
Goodwill, net 1,741 1,709
Regulatory assets 3,350 2,955
Other non-current assets 997 1,069
Non-current assets of discontinued operations 1,051 --
------------ ------------
Total other assets 7,139 5,733
------------ ------------
TOTAL ASSETS $ 18,096 $ 17,116
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of transition bond long-term debt $ 47 $ 73
Current portion of other long-term debt 1,789 266
Other current liabilities 2,836 2,651
Current liabilities of discontinued operations 449 --
------------ ------------
Total current liabilities 5,121 2,990
------------ ------------
OTHER LIABILITIES:
Accumulated deferred income taxes, net and investment tax credit 2,469 2,544
Regulatory liabilities 1,082 728
Other non-current liabilities 705 990
Non-current liabilities of discontinued operations 420 --
------------ ------------
Total other liabilities 4,676 4,262
------------ ------------
LONG-TERM DEBT:
Transition bond 629 2,407
Other 6,564 6,161
------------ ------------
Total long-term debt 7,193 8,568
------------ ------------
SHAREHOLDERS' EQUITY 1,106 1,296
------------ ------------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 18,096 $ 17,116
============ ============
Reference is made to the Notes to the Consolidated Financial Statements
contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.
CenterPoint Energy, Inc. and Subsidiaries
Condensed Statements of Consolidated Cash Flows
(Millions of Dollars)
(Unaudited)
Twelve Months Ended December 31,
--------------------------------
2004 2005
------------ --------------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (905) $ 252
Discontinued operations, net of tax 133 3
Extraordinary item, net of tax 977 (30)
----------- -----------
Income from continuing operations 205 225
Adjustments to reconcile income from continuing operations to net
cash provided by operating activities:
Depreciation and amortization 582 618
Deferred income taxes and investment tax credit 258 224
Changes in net regulatory assets and liabilities (520) (192)
Changes in other assets and liabilities (164) (795)
Other, net 20 18
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NET CASH PROVIDED BY OPERATING ACTIVITIES OF CONTINUING OPERATIONS 381 98
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES OF DISCONTINUED OPERATIONS 355 (38)
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NET CASH PROVIDED BY OPERATING ACTIVITIES 736 60
NET CASH PROVIDED BY INVESTING ACTIVITIES 1,466 20
NET CASH USED IN FINANCING ACTIVITIES (2,124) (171)
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NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 78 (91)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 87 165
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CASH AND CASH EQUIVALENTS AT END OF YEAR $ 165 $ 74
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Reference is made to the Notes to the Consolidated Financial Statements
contained in the Annual Report on Form 10-K of CenterPoint Energy, Inc.