Puget Energy Reports Third-Quarter 2005 Earnings; Washington Regulators Approve All-Party Regulatory Settlement for Power Cost Rate Case.BELLEVUE Bellevue (bĕl`vy  ).1 City (1990 pop. 30,982), Sarpy co., E Nebr., a suburb of Omaha, on the Missouri River; inc. 1855. , Wash. -- Puget For the explorer of Puget Sound, see Peter Puget. Puget is a commune of the Vaucluse département in southern France. Coordinates: Energy (NYSE NYSE See: New York Stock Exchange :PSD (tool) PSD - Portable Scheme Debugger. ) today reported third quarter 2005 net income from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the of $5.9 million, or 6 cents per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, compared to net income of $9.4 million, or 9 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. , in the third quarter of 2004. Puget Energy's electric and natural gas utility, Puget Sound Energy Puget Sound Energy (PSE) is an energy company providing electrical power and natural gas in the Puget Sound region of the northwest United States. It serves electrical power to over 1 million customers in Island, Jefferson, King, Kitsap, Kittitas, Pierce, Skagit, Thurston, and (PSE PSE 1. pale soft exudative pork. 2. portosystemic encephalopathy. ), reported third quarter 2005 net income of $6.2 million compared to third quarter 2004 net income of $9.6 million. Higher utility operations and maintenance costs and plant depreciation expense during the third quarter 2005 offset the impact of an increase in margins from higher energy sales to electric and natural gas customers. On October October: see month. 26, 2005, Puget Energy sold 15 million shares of common stock. The $310 million in net proceeds Net Proceeds The amount received after all costs are deducted from the sale of a piece of property or security. Notes: In the case of an investor selling a security, net proceeds represent the proceeds from the sale minus any trading costs (i.e. commissions). from this issuance will be invested in PSE to repay short-term debt Short-term debt Debt obligations, recorded as current liabilities, requiring payment within the year. incurred primarily to fund the utility's construction program. "We're we're Contraction of we are. we're we are investing in necessary energy infrastructure to provide safe, reliable service to our growing region A growing region is an area suited by climate and soil conditions to the cultivation of a certain type of crop. Most crops are cultivated not in one place only, but in several distinct regions in diverse parts of the world. ," said Puget Energy Chairman, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. Stephen Stephen, 1097?–1154, king of England (1135–54). The son of Stephen, count of Blois and Chartres, and Adela, daughter of William I of England, he was brought up by his uncle, Henry I of England, who presented him with estates in England and France and P. Reynolds. "We are also highlighting our energy efficiency programs to help our customers manage through this period of high energy prices," added Reynolds. "As part of our 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. resource plan, the 150 megawatt meg·a·watt n. Abbr. MW One million watts. meg  a·watt Hopkins Hopkins, city (1990 pop. 16,534), Hennepin co., SE Minn., a suburb of Minneapolis; inc. as West Minneapolis 1893, name changed 1928. The city manufactures machinery, computer and electronic parts, steel products, air pollution equipment, ophthalmic lenses, tools, Ridge wind power project received regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. approval and is on track to begin serving customers by year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. . We have also begun construction on our second, larger wind power project and will begin our review of a new series of electric generating resources," said Reynolds. Puget Energy reaffirmed previously announced 2005 earnings guidance from continuing operations of $1.30 to $1.40 per diluted share, assuming normal weather patterns in the fourth quarter of 2005. Third Quarter 2005 Summary for Puget Sound Energy (PSE) -- PSE reported income for common stock of $6.2 million for the third quarter of 2005, or 6 cents per diluted share, compared with income for common stock of $9.6 million, or 10 cents per share for the same period in 2004. -- PSE's electric sales volumes to retail customers increased by 1.5 percent in the third quarter of 2005 compared to the same period in 2004. Over the last twelve months the number of PSE's electric customers increased by 1.8 percent. PSE's electric margin increased by $0.4 million pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta in the third quarter of 2005 compared to the same period in 2004. -- PSE's natural gas sales volumes to retail customers increased by 1.3 percent in the third quarter of 2005 compared to the same period a year ago. Over the last twelve months the number of PSE's natural gas customers increased by 2.9 percent. Gas margin for the third quarter of 2005 grew by $4.4 million pre-tax compared to the same period in 2004 reflecting higher sales volumes and a March 2005 general tariff tariff, tax on imported and, more rarely, exported goods. It is also called a customs duty. Tariffs may be distinguished from other taxes in that their predominant purpose is not financial but economic—not to increase a nation's revenue but to protect domestic rate increase. -- PSE's utility operations and maintenance expenses increased by $14.5 million pre-tax in the third quarter of 2005 compared to the same period in 2004. The increase in 2005 was largely driven by higher planned maintenance costs at company-owned energy production and delivery facilities and employee pension and benefit expense. -- PSE's depreciation and amortization expenses increased by $3.0 million pre-tax in the third quarter of 2005 compared to the third quarter of 2004 reflecting the addition of new utility infrastructure. InfrastruX Group (InfrastruX) Puget Energy reports the financial results of InfrastruX in 2005 as discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. , following the accounting guidance of FAS-144 "Accounting for the Impairment Impairment 1. A reduction in a company's stated capital. 2. The total capital that is less than the par value of the company's capital stock. Notes: 1. This is usually reduced because of poorly estimated losses or gains. 2. or Disposal of Long-Lived long-lived adj. 1. Having a long life: a long-lived aunt. 2. Lasting a long time; persistent: a long-lived rumor. 3. Assets." For additional information regarding InfrastruX's financial performance during the third quarter 2005 please refer to Puget Energy's Form 10-Q Form 10-Q See 10-Q. for the period ended September September: see month. 30, 2005.
Puget Energy Third Quarter 2005 vs. Third Quarter 2004 EPS
Reconciliation
Cents per
diluted share
----------------------------------------------------------------------
Puget Energy Q3 2004 Reported Earnings from
Continuing Operations $0.09
Increase in utility energy margins in 2005 0.03
Increase in utility O&M expense in 2005 (0.08)
Increase in utility depreciation expense in
2005 (0.02)
Decrease in property and income taxes 0.02
All other variances, net 0.02
----------------------------------------------------------------------
Puget Energy Q3 2005 Earnings from Continuing
Operations $0.06
----------------------------------------------------------------------
Form 10-Q Quarterly Report for the Third Quarter of 2005 Puget Energy provided additional information on its third quarter 2005 financial results in a Form 10-Q, filed with the Securities and Exchange Commission on November November: see month. 1, 2005. A copy of the Form 10-Q is available through the SEC's web site at www.sec.gov See .gov and GovNet. (networking) gov - The top-level domain for US government bodies. or at the Company's web site at www.pugetenergy.com. Investors are encouraged to read the financial statements and disclosures contained in the Form 10-Q filing. Calendar Year 2006 Earnings Guidance Puget Energy today reaffirmed its previously announced earnings guidance for calendar year 2006 of $1.40 to $1.55 per diluted share from continuing operations, assuming normal weather conditions. Third Quarter 2005 Earnings Presentation Webcast A management discussion of the third quarter results is scheduled for 10 a.m. ET (7 a.m. PT) on Wednesday Wednesday: see week. , November 2, 2005. A live webcast of the presentation can be accessed through the "Shareholders and Analysts" section at www.pugetenergy.com. The webcast will be archived and available for replay following the live broadcast through midnight (ET) on Wednesday, November 16, 2005. A recorded replay of the conference call also will be available two hours after completion on November 2 through midnight (ET) November 16, 2005. To access the recording, dial 1-888-286-8010, and enter the conference I.D. number 39996436. Puget Energy is an energy services holding company that conducts all of its operations through its subsidiaries, PSE and InfrastruX Group. PSE is a regulated utility company that generates, purchases and sells electricity; and purchases, transports and sells natural gas. The service territory of PSE covers approximately 6,000 square miles A square mil is a unit of area, equal to the area of a square with sides of length one mil. A mil is one thousandth of an international inch. This unit of area is usually used in specifying the area of the cross section of a wire or cable. , principally in the Puget Sound Puget Sound (py `jĕt), arm of the Pacific Ocean, NW Wash., connected with the Pacific by Juan de Fuca Strait, entered through the Admiralty Inlet and extending in two arms c. region of Washington Washington, town, EnglandWashington, town (1991 pop. 48,856), Sunderland metropolitan district, NE England. Washington was designated one of the new towns in 1964 to alleviate overpopulation in the Tyneside-Wearside area. state. InfrastruX specializes in contracting services to other gas and electric utilities primarily in the Midwest Midwest or Middle West, region of the United States centered on the western Great Lakes and the upper-middle Mississippi valley. It is a somewhat imprecise term that has been applied to the northern section of the land between the Appalachians , Texas, and the south-central Adj. 1. south-central - situated in the southern part of a centrally located area in some geographical region; "south-central London" south - situated in or facing or moving toward or coming from the south; "the south entrance" 2. and eastern United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. regions. CAUTIONARY STATEMENT: Certain statements contained in this press release are "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. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995, among which include Puget Energy's anticipated 2005 and 2006 financial results, including its earnings guidance. Forward-looking statements are based on the opinions and estimates of management at the time the statements are made and are subject to certain risks and uncertainties that could cause actual results to differ materially from those anticipated in the forward-looking statements. Factors that could affect actual results include, among others, governmental policies and regulatory actions, including those of the WUTC WUTC Washington Utilities and Transportation Commission , and weather conditions. More information about these and other factors that potentially could affect the company's financial results is included in Puget Energy's and PSE's most recent annual report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. , quarterly report on Form 10-Q and in their other public filings filed with the Securities and Exchange Commission. Except as required by law, Puget Energy and PSE undertake no obligation to update any forward-looking statements.
PUGET ENERGY -- SUMMARY INCOME STATEMENT
----------------------------------------
(In thousands, except per-share amounts)
Unaudited Unaudited
Three months ended Nine months ended
9/30(1) 9/30
-------------------- -----------------------
2005 2004 2005 2004
---------- -------- ----------- ----------
Operating revenues
Electric $ 375,035 $322,669 $1,140,545 $1,018,256
Gas 111,042 89,432 594,737 484,603
Other 4,306 2,925 6,866 4,005
--------- -------- ---------- ----------
Total operating
revenues 490,383 415,026 1,742,148 1,506,864
--------- -------- ---------- ----------
Operating expenses
Purchased electricity 200,861 147,589 587,983 517,803
Electric generation
fuel 21,058 25,130 54,400 60,132
Residential exchange (34,525) (34,014) (126,676) (123,799)
Purchased gas 59,151 44,574 359,037 270,683
Unrealized net (gain)
loss on derivative
instruments 477 1,894 395 (1,042)
Utility operations &
maintenance 81,645 67,093 240,299 214,149
Other operations &
maintenance 745 529 2,045 1,513
Depreciation &
amortization 60,550 57,598 178,284 170,036
Conservation
amortization 5,633 4,747 16,746 17,746
Taxes other than income
taxes 44,784 42,710 165,005 149,486
Income taxes 2,476 6,958 54,649 40,621
--------- -------- ---------- ----------
Total operating
expenses 442,855 364,808 1,532,167 1,317,328
--------- -------- ---------- ----------
Operating income 47,528 50,218 209,981 189,536
Other income
(deductions):
Other income 1,422 356 4,184 1,994
Interest Charges:
AFUDC 2,680 1,650 6,183 3,807
Interest expense (45,695) (42,754) (130,307) (128,796)
Mandatorily
redeemable
securities interest
expense (23) (23) (68) (68)
--------- -------- ---------- ----------
Income from continuing
operations 5,912 9,447 89,973 66,473
Income (loss) from
discontinued
operations, net of tax (1) 1,677 908 4,237
--------- -------- ---------- ----------
Net Income $ 5,911 $ 11,124 $ 90,881 $ 70,710
========= ======== ========== ==========
Common shares
outstanding 100,371 99,580 100,160 99,373
Diluted shares
outstanding 100,964 100,043 100,754 99,836
--------- -------- ---------- ----------
Basic earnings per
common share from
continuing operations $ 0.06 $ 0.09 $ 0.90 $ 0.67
Basic earnings from
discontinued operations - 0.02 0.01 0.04
--------- -------- ---------- ----------
Basic earnings per
common share $ 0.06 $ 0.11 $ 0.91 $ 0.71
========= ======== ========== ==========
Diluted earnings per
common share from
continuing operations $ 0.06 $ 0.09 $ 0.89 $ 0.67
Diluted earnings from
discontinued operations - 0.02 0.01 0.04
--------- -------- ---------- ----------
Diluted earnings per
common share(2) $ 0.06 $ 0.11 $ 0.90 $ 0.71
========= ======== ========== ==========
(1) Partial-year results may not accurately predict full-year
performance, as earnings are significantly affected by weather.
(2) Diluted earnings per common share include the dilutive effect of
securities related to employee compensation plans.
PUGET SOUND ENERGY -- UTILITY OPERATING DATA
--------------------------------------------
Three months ended 9/30 Nine months ended 9/30
----------------------- -------------------------
2005 2004 2005 2004
------------ ---------- ------------- -----------
Energy sales
revenues ($ in
thousands;
unaudited)
Electricity
Residential $ 131,719 $ 122,397 $ 496,517 $ 459,058
Commercial 153,138 143,711 461,073 428,877
Industrial 23,667 22,165 68,902 65,318
Other retail
sales,
including
change in
unbilled 6,810 5,379 (7,584) (11,199)
---------- ---------- ----------- -----------
Subtotal,
retail
sales 315,334 293,652 1,018,908 942,054
Transportation,
including
change in
unbilled 1,654 2,728 6,741 7,342
Sales to other
utilities &
marketers 40,626 16,558 73,818 38,793
Other(1) 17,421 9,731 41,078 30,067
---------- ---------- ----------- -----------
Total
electricity
sales 375,035 322,669 1,140,545 1,018,256
Gas
Residential 57,260 47,100 360,660 295,381
Commercial 37,252 29,047 178,878 144,155
Industrial 9,221 6,864 32,247 25,436
---------- ---------- ----------- -----------
Subtotal,
retail
sales 103,733 83,011 571,785 464,972
Transportation 3,332 3,133 9,944 9,679
Other 3,977 3,288 13,008 9,952
---------- ---------- ----------- -----------
Total gas
sales 111,042 89,432 594,737 484,603
---------- ---------- ----------- -----------
Total energy
sales revenues $ 486,077 $ 412,101 $ 1,735,282 $ 1,502,859
-------------------- ----------- ---------- ------------ -----------
Energy sales
volumes
(Unaudited)
Electricity (in
mWh)
Residential 1,957,275 1,930,772 7,515,907 7,367,917
Commercial 2,168,625 2,146,246 6,432,239 6,314,739
Industrial 352,808 351,834 1,014,948 1,009,456
Other,
including
change in
unbilled 51,992 33,569 (229,003) (269,805)
---------- ---------- ----------- -----------
Subtotal,
retail
sales 4,530,700 4,462,421 14,734,091 14,422,307
Transportation,
including
change in
unbilled 516,588 530,204 1,516,519 1,473,619
Sales to other
utilities &
marketers 705,593 379,280 1,498,527 930,570
---------- ---------- ----------- -----------
Total mWh 5,752,881 5,371,905 17,749,137 16,826,496
Gas (in 000's of
therms)
Residential 43,750 43,403 322,792 315,128
Commercial 36,551 35,067 183,011 182,748
Industrial 10,052 9,206 34,897 34,143
Transportation 44,306 45,238 145,870 148,834
---------- ---------- ----------- -----------
Total gas
volumes 134,659 132,914 686,570 680,853
-------------------- ----------- ---------- ------------ -----------
Margins(2)($ in
thousands;
unaudited)
Electric $ 149,627 $ 149,271 $ 503,605 $ 451,997
Gas 38,793 34,349 171,971 163,035
-------------------- ----------- ---------- ------------ -----------
Customers served(3)
(Unaudited)
Electricity
Residential 894,929 879,742 891,508 875,579
Commercial 112,428 109,781 111,628 108,939
Industrial 3,903 3,957 3,914 3,993
Other 2,462 2,221 2,406 2,170
Transportation 17 17 17 17
---------- ---------- ----------- -----------
Total
electricity
customers 1,013,739 995,718 1,009,473 990,698
Gas
Residential 629,963 611,534 627,123 607,654
Commercial 50,637 49,591 50,564 49,458
Industrial 2,674 2,708 2,691 2,727
Transportation 130 129 130 129
---------- ---------- ----------- -----------
Total gas
customers 683,404 663,962 680,508 659,968
-------------------- ----------- ---------- ------------ -----------
Weather (Unaudited)
Actual heating
degree days 212 219 2,811 2,779
Normal heating
degree days(4) 238 238 3,068 3,068
(1) Includes sales of non-core gas supplies.
(2) Electric margin is electric sales to retail and transportation
customers less the cost of generating and purchasing electric
energy sold to customers, including transmission costs, to bring
electric energy to PSE's service territory. Gas margin is gas
sales to retail and transportation customers less the cost of gas
purchased, including gas transportation costs, to bring gas to
PSE's service territory.
(3) Customers represents average served during the period.
(4) Seattle-Tacoma Airport statistics reported by NOAA which are
based on a 30-year average, 1971-2000. Heating degree days
measure how far the daily average temperature falls below 65
degrees. Heating degree days in 2004 are adjusted for leap year
by adding the February 28th heating degree day amount.
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