Dominion Announces Second-Quarter Earnings of 97 Cents Per Share.Business Editors Dominion dominion, power to rule, or that which is subject to rule. Before 1949 the term was used officially to describe the self-governing countries of the Commonwealth of Nations—e.g., Canada, Australia, or India. (NYSE NYSE See: New York Stock Exchange : D): -- Added 1,715 megawatts of generation during the quarter, bringing the company's portfolio to nearly 24,000 megawatts. -- Added 566 net billion cubic feet equivalent to proved gas and oil reserves, bringing total proved reserves to 5.7 trillion cubic feet equivalent. -- Gained over 40,000 franchise customers since the second quarter of 2001. Dominion (NYSE: D) announced today unaudited consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before for the second quarter ended June June: see month. 30, 2002, of $272 million (97 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. ), compared with operating earnings of $180 million (72 cents per share) for the same period in 2001. Reported earnings per share for second-quarter 2002 were 97 cents per share and for second-quarter 2001 were 62 cents per share. Operating earnings for the second quarter of 2001 excluded a $25 million charge related to the divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). of Saxon Saxon Any member of a Germanic people who lived along the Baltic coast in ancient times and later migrated west as far as the British Isles. The Saxons became pirates in the North Sea during the decline of the Roman empire, and in the early 5th century they spread through Capital, Inc. Second quarter 2002 reported earnings were the same as operating earnings. Thos. E. Capps, chairman, president and chief executive officer, said: "Our second-quarter results demonstrate the strength and dependability dependability - software reliability of Dominion's asset-backed, integrated business model. We've we've Contraction of we have. we've have maintained year-over-year earnings growth and expect to sustain it the old-fashioned old-fash·ioned adj. 1. Of a style or method formerly in vogue; outdated. 2. Attached to or favoring methods, ideas, or customs of an earlier time: old-fashioned parents. n. way - by rigorously improving our business processes through Six Sigma Not to be confused with Sigma 6. Six Sigma is a set of practices originally developed by Motorola to systematically improve processes by eliminating defects.[1] A defect is defined as nonconformity of a product or service to its specifications. , by prudently pru·dent adj. 1. Wise in handling practical matters; exercising good judgment or common sense. 2. Careful in regard to one's own interests; provident. 3. Careful about one's conduct; circumspect. hedging our wholesale energy production, by carefully controlling costs and by producing and delivering energy at high efficiency levels. "Hot weather added about 7 cents per share compared to normal weather, and we benefited 5 cents per share through the timing of our corporate hedges on natural gas. Even without these benefits, our year-over-year growth was solid. "We're we're Contraction of we are. we're we are pleased that during a difficult and unsettling un·set·tle v. un·set·tled, un·set·tling, un·set·tles v.tr. 1. To displace from a settled condition; disrupt. 2. To make uneasy; disturb. v.intr. period for our industry and financial markets in general, Dominion is providing a return to our investors through the payment of common stock dividends and bond coupons COUPONS. Those parts of a commercial instrument which are. to be cut, and which are evidence of something connected with the contract mentioned in the instrument. They are generally attached to certificates of loan, where the interest is payable at particular periods, and, when the as well as growth in the company's long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. value. We are also pleased that Dominion is a company with which our employees can be proudly associated, that our investors can trust and upon which our customers can depend. "Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. results remain in line with our expectations. Dominion is positioned to earn between $4.90 and $4.95 per share for the full year 2002 and grow earnings an average of 10 percent annually going forward." Other selected second-quarter highlights include: -- Added 1,715 megawatts of generation during the quarter, bringing the company's portfolio to nearly 24,000 megawatts. -- Added 566 net billion cubic feet equivalent to proved gas and oil reserves, bringing total proved reserves to 5.7 trillion cubic feet equivalent. -- Gained over 40,000 franchise customers since the second quarter of 2001. Earnings breakdown by operating segment Dominion Energy contributed $171 million (61 cents per share) to second-quarter 2002 earnings compared to $148 million (59 cents per share) in the second quarter of 2001. The increase in Dominion Energy's second-quarter 2002 earnings resulted from higher than normal temperatures in the company's electric service area, customer growth, and the 5-cent per share corporate hedge impact, partially offset by share dilution Dilution A reduction in earnings per share of common stock that occurs through the issuance of additional shares or the conversion of convertible securities. Notes: Adding to the number of shares outstanding reduces the value of holdings of existing shareholders. and other factors. Dominion Delivery earned $72 million (26 cents per share) in its second quarter compared to $47 million (19 cents per share) for the same period in 2001. The increase in Dominion Delivery's second-quarter earnings is primarily attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to higher than normal temperatures, customer growth, and reduced expenses, partially offset by share dilution and other factors. Dominion Exploration & Production (E&P) contributed $92 million (33 cents per share) to second-quarter 2002 earnings, up from $84 million (34 cents per share) in the second quarter of 2001. The change in Dominion E&P's second-quarter earnings is primarily attributable to higher production, offset by lower average realized prices, increased expenses and share dilution. The corporate segment, including Dominion Capital, posted net expenses of $63 million (23 cents per share) for the quarter, compared to net expenses of $99 million (40 cents per share) in the second quarter of 2001. The decrease in the corporate segment's net expenses is attributable to the elimination of goodwill amortization, Dominion Capital's contribution, and other factors. Legal entity results Dominion assets remain wholly-owned by its legal subsidiaries, Virginia Virginia, state, United States Virginia, state of the south-central United States. It is bordered by the Atlantic Ocean (E), North Carolina and Tennessee (S), Kentucky and West Virginia (W), and Maryland and the District of Columbia (N and NE). Electric and Power Company (Virginia Power), Consolidated Natural Gas Company (CNG CNG Compressed Natural Gas CNG Calling (Tone) CNG Comfort Noise Generation CNG Cryptography Next Generation (Microsoft Windows Vista) CNG Centre National de Génotypage ), and Dominion Energy Inc. (DEI), pending full implementation of electric and gas deregulation Deregulation The reduction or elimination of government power in a particular industry, usually enacted to create more competition within the industry. Notes: Traditional areas that have been deregulated are the telephone and airline industries. legislation in the company's service areas. Second-quarter 2002 earnings for Virginia Power were 61 cents per share, compared to 51 cents per share in the second quarter of 2001. Second-quarter 2002 earnings for CNG were 37 cents per share, compared to 29 cents per share in 2001. DEI earned 22 cents per share in the second quarter of 2002, compared to 31 cents per share in the second quarter of 2001. Conference call for investors / media Dominion will host a conference call for investors today at 10 a.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT during which Dominion management will review both second-quarter 2002 earnings and the outlook for the remainder of 2002. Members of the media are also invited to listen. A live web cast of the conference call will be available on the company's investor information page at www.dom.com/investors. Slides will also be available on the company's web site for the convenience of our investors as a visual aid to accompany To go along with; to go with or to attend as a companion or associate. A motor vehicle statute may require beginning drivers or drivers under a certain age to be accompanied by a licensed adult driver whenever operating an automobile. the audio web cast. Domestic investors who wish to participate in the conference call should dial 888-569-5033. International investors should call 719-457-2653. The confirmation number required to join the call is 788425. Participants should dial in 5 to 10 minutes prior to the scheduled start time. A tape recording of the conference call will be available from approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 1 p.m. ET July July: see month. 18 through 11 p.m. ET July 23. Domestic investors may access the recording by dialing 888-203-1112. International callers should dial 719-457-0820 to access the recording. The access code for the replay is also 788425. A replay of the conference call also will be available on the company's investor information home page by the end of the day July 18. Dominion has a diversified diversified (di·verˑ·s and integrated energy portfolio consisting of nearly 24,000-megawatts of generation, 5.7 trillion One thousand times one billion, which is 1, followed by 12 zeros, or 10 to the 12th power. See space/time. (mathematics) trillion - In Britain, France, and Germany, 10^18 or a million cubed. In the USA and Canada, 10^12. cubic feet equivalent of natural gas reserves, 7,600 miles of natural gas transmission pipeline and the nation's largest underground natural gas storage system with more than 950 billion cubic feet of storage capacity. Dominion also serves over 3.8 million franchise natural gas and electric customers in five states. In addition, Dominion owns a managing equity interest in Dominion Fiber Ventures LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control , owner of Dominion Telecom. For more information about Dominion, visit the company's web site at www.dom.com. This release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that are subject to various risks and uncertainties. Discussion of factors that could cause actual results to differ materially from management's projections, forecasts, estimates and expectations may include factors that are beyond the company's ability to control or estimate precisely, such as estimates of future market conditions, estimates of proved and unproved reserves and the behavior of other market participants The term market participant is used in United States constitutional law to describe a U.S. State which is acting as a producer or supplier of a marketable good or service. When a state is acting in such a role, it may permissibly discriminate against non-residents. . Other factors include, but are not limited to, weather conditions, economic conditions in the company's service area, fluctuations in energy-related commodity prices, trading counterparty Counterparty The other participant, including intermediaries, in a swap or contract. credit risks, risks associated with successfully executing the telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. business plan and other uncertainties. Other risk factors are detailed from time to time in the company's Securities & Exchange Commission filings.
Dominion Resources Inc.
Preliminary Earnings Report - Operating Segments
June 2002
(millions, except earnings per share)
2nd Quarter Ended 6 Months Ended
June 30 June 30
2002 2001 2002 2001
---- ---- ---- ----
Operating Revenues & Income $ 2,347 $ 2,309 $ 4,981 $ 5,507
======== ======== ======== ========
Earnings:
Dominion Energy $ 171 $ 148 $ 312 $ 308
Dominion Delivery 72 47 219 205
Dominion Exploration & Production 92 84 180 155
Corporate, Dominion Capital
& Other (63) (99) (118) (189)
---- ---- ----- ------
OPERATING EARNINGS (EXCLUDING
SPECIAL ITEMS) $ 272 $ 180 $ 593 $ 479
======== ========= ======== ========
Special Items (see Note 1) - (25) - (161)
REPORTED NET INCOME $ 272 $ 155 $ 593 $ 318
======== ========= ======== ========
Common Shares Outstanding
(average, diluted) 281.1 250.0 275.1 249.4
Earnings Per Share (EPS):
Dominion Energy $ 0.61 $ 0.59 $ 1.14 $ 1.23
Dominion Delivery 0.26 0.19 0.80 0.82
Dominion Exploration & Production 0.33 0.34 0.66 0.62
Corporate, Dominion Capital &
Other (0.23) (0.40) (0.44) (0.75)
------- ------ ------ ------
OPERATING EPS (EXCLUDING SPECIAL
ITEMS) $ 0.97 $ 0.72 $ 2.16 $ 1.92
======== ======= ======= =======
Special Items (see Note 1) - (0.10) - (0.65)
REPORTED EPS $ 0.97 $ 0.62 $ 2.16 $ 1.27
======== ======= ======= =======
Note 1: Special Items
Pre-tax
NUG buyout $ (220)
Loss on sale of Saxon Mortgage $ (40) $ (40)
After-tax
NUG buyout $ (136)
Loss on sale of Saxon Mortgage $ (25) $ (25)
EPS impact
NUG buyout $ (0.55)
Loss on sale of Saxon Mortgage $ (0.10) $ (0.10)
Dominion Resources Inc.
Preliminary Earnings Report - Legal Entities
June 2002
(millions, except earnings per share)
2nd Quarter Ended 6 Months Ended
June 30 June 30
2002 2001 2002 2001
------ ------ ----- -----
Operating Revenues & Income $ 2,347 $ 2,309 $ 4,981 $ 5,507
======== ======= ======= =======
Earnings:
Virginia Power $ 171 $ 128 $ 320 $ 283
Consolidated Natural Gas 104 73 305 252
Dominion Energy 63 79 75 116
Corporate, Dominion Capital
& Other (66) (100) (107) (172)
---- ----- ----- -----
OPERATING EARNINGS (EXCLUDING
SPECIAL ITEMS) $ 272 $ 180 $ 593 $ 479
======== ======== ======== ========
Special Items (see Note 1) - (25) - (161)
REPORTED NET INCOME $ 272 $ 155 $ 593 $ 318
======== ======== ======== ========
Common Shares Outstanding
(average, diluted) 281.1 250.0 275.1 249.4
Earnings Per Share (EPS):
Virginia Power $ 0.61 $ 0.51 $ 1.16 $ 1.13
Consolidated Natural Gas 0.37 0.29 1.11 1.01
Dominion Energy 0.22 0.31 0.27 0.46
Corporate, Dominion Capital
& Other (0.23) (0.39) (0.38) (0.68)
------ ------ ------ -----
OPERATING EPS (EXCLUDING SPECIAL
ITEMS) $ 0.97 $ 0.72 $ 2.16 $ 1.92
======== ======= ======= =======
Special Items (see Note 1) - (0.10) - (0.65)
REPORTED EPS $ 0.97 $ 0.62 $ 2.16 $ 1.27
======== ======= ======= =======
Note 1: Special Items
Pre-tax
NUG buyout $ (220)
Loss on sale of Saxon Mortgage $ (40) $ (40)
After-tax
NUG buyout $ (136)
Loss on sale of Saxon Mortgage $ (25) $ (25)
EPS impact
NUG buyout $ (0.55)
Loss on sale of Saxon Mortgage $ (0.10) $ (0.10)
Dominion
Preliminary 2nd Quarter
Variance Reconciliation (unaudited)
2002 vs. 2001
Quarter-vs.-Quarter Variance
Reconciling Items (cents per share)
-----------------
Dominion Energy
(61 cents per share 2Q'02 vs.
59 cents per share 2Q'01)
Customer growth 2
Weather 5
Energy Clearinghouse (4)
Corporate hedge 5
Other including expenses and share dilution (6)
---
Total 2
Dominion Delivery
(26 cents per share 2Q'02 vs.
19 cents per share 2Q'01)
Customer growth 1
Weather - electric 3
Weather - gas 2
Other including expenses and share dilution 1
---
Total 7
Dominion E&P
(33 cents per share 2Q'02 vs.
34 cents per share 2Q'01)
Production 17
Average realized prices (3)
O&M expense (9)
Other factors including share dilution (6)
---
Total (1)
Corporate, Dominion Capital & Other
(-23 cents per share 2Q'02 vs.
-40 cents per share 2Q'01)
Goodwill expense 9
Dominion Capital 6
Other factors including share dilution 2
---
Total 17
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