UIL Holdings Corporation Announces First Quarter 2005 Earnings and Reaffirms Full-Year 2005 Earnings Guidance.NEW HAVEN New Haven, city (1990 pop. 130,474), New Haven co., S Conn., a port of entry where the Quinnipiac and other small rivers enter Long Island Sound; inc. 1784. Firearms and ammunition, clocks and watches, tools, rubber and paper products, and textiles are among the many , Conn. -- UIL UIL - User Interface Language Holdings Corporation (NYSE NYSE See: New York Stock Exchange : UIL) today reported 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 for the first quarter of 2005 of $3.2 million, or $0.22 per share, compared to $5.7 million, or $0.40 per share for the first quarter of 2004. "The decrease in first quarter earnings for 2005 was anticipated, as there were a number of non-recurring gains recognized at the utility during the first quarter of 2004," commented Nathaniel D. Woodson Woodson may refer to: People
n. 1. A quantity or portion of something lacking after delivery or storage. 2. A temporary suspension of operation, especially of electric power. ." "With respect to the Connecticut Connecticut, state, United States Connecticut (kənĕt`ĭkət), southernmost of the New England states of the NE United States. It is bordered by Massachusetts (N), Rhode Island (E), Long Island Sound (S), and New York (W). Siting Council's recent decision approving the Middletown Middletown, cities, United States Middletown. 1 Industrial city (1990 pop. 42,762), Middlesex co., central Conn., on the west bank of the Connecticut River; settled 1650, inc. 1784, town and city consolidated 1923. to Norwalk Norwalk (nôr`wôk'). 1 City (1990 pop. 94,279), Los Angeles co., S Calif.; settled in the 1850s, inc. 1957. With the arrival (1875) of the Southern Pacific RR, it became a center for the dairy and logging industries, but transmission project, we are very pleased to be able to move forward with this significant investment in a vital infrastructure project," added Mr. Woodson. "An upgrade to the transmission system is urgently needed and will benefit the electric consumers of Connecticut by improving reliability and reducing federally mandated congestion charges congestion charge congestion n → City-Maut f congestion charge n → pedaggio da pagare per poter circolare in automobile nel centro di alcune città, introdotto per la prima volta a ." The United Illuminating The United Illuminating Holdings Corporation (UI) is an electricity distributor for southern Connecticut. It currently serves roughly 320,000 customers in 17 municipalities in the Greater Bridgeport, New Haven, and Lower Naugatuck Valley regions. Company (UI) Net income for UI, the regulated 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. electric utility subsidiary of UIL, totaled $7.8 million, or $0.54 per share, in first quarter of 2005, compared to net income of $9.6 million, or $0.67 per share, in the first quarter of 2004. Absent $0.13 per share of non-recurring gains recognized in the first quarter of 2004, UI's first quarter 2005 net income was unchanged from the same period of 2004. The non-recurring gains recognized in the first quarter of 2004 were as follows: (1) a $0.03 per share gain attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to the impact of the final decisions issued by the Department of Public Utility Control (DPUC DPUC Department of Public Utility Control (Connecticut) ) regarding the disposition Act of disposing; transferring to the care or possession of another. The parting with, alienation of, or giving up of property. The final settlement of a matter and, with reference to decisions announced by a court, a judge's ruling is commonly referred to as disposition, regardless of of proceeds from UI's investment in its nuclear generating facilities, (2) a $0.07 per share adjustment related to a change in the accounting estimate for unbilled un·billed adj. 1. Not having been billed or charged for: unbilled medical charges. 2. Appearing, as in a movie, without being credited: an unbilled walk-on. revenues resulting from the implementation of a new integrated software package Software that combines several applications in one program, typically providing at least word processing, spreadsheet and database management. Presentation graphics, page layout, paint, calendar, address book, e-mail and other applications may also be included. which provides a more precise method of calculating unbilled revenue and (3) $0.03 per share related to the DPUC's decision allowing partial recovery of increased pension and post-retirement benefits expenses for a portion of 2004. Excluding the impact of the non-recurring unbilled kilowatt-hour kil·o·watt-hour n. Abbr. kWh or kW-hr A unit of electric energy equal to the work done by one kilowatt acting for one hour. adjustment recognized in the first quarter of 2004, actual kilowatt-hour volume consumption before correcting for weather and the impact of leap year leap year: see calendar. was 0.2% lower than the first quarter of 2004. However, real retail kilowatt-hour volume consumption, excluding the impacts of weather, leap year and the unbilled kilowatt-hour adjustment, was approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 2% higher than the first quarter of 2004.
Real Retail kWh Sales excluding Weather, Leap Year and Unbilled
Adjustment
Q1 2005 Q1 2004 % Change
------- ------- --------
Millions of kWh 1,471 1,443 2%
Non-Utility Businesses UIL serves as the parent company for the operating business Xcelecom, Inc. (Xcelecom), and two entities which hold minority ownership interests in their respective investments, United Bridgeport Energy, Inc. (UBE Ube (  `bā), city (1990 pop. 175,053), Yamaguchi prefecture, SW Honshu, Japan, on the Inland Sea. It has a modern harbor and an important chemical industry. ) and United Capital Investments, Inc. (UCI UCI University of California, IrvineUCI Union Cycliste Internationale (International Cycling Union) UCI Unidad de Cuidados Intensivos UCI United Cinemas International (UK) ). The non-utility businesses, including unallocated UIL Corporate costs, reported a loss from continuing operations of $4.6 million, or $0.32 per share, in the first quarter of 2005 compared to a loss from continuing operations of $3.9 million, or $0.27 per share, in the same period of 2004. Xcelecom, Inc. Xcelecom, engaged in the specialty A contract under seal. A specialty is a written document that has been sealed and delivered and is given as security for the payment of a specifically indicated debt. electrical contracting and voice-data-video systems integration business, reported a net loss of $0.7 million, or $0.05 per share in the first quarter of 2005, compared to a net loss of $0.6 million, or $0.04 per share in the first quarter of 2004. Although overall revenues at Xcelecom increased by approximately $24 million as compared to the first quarter of 2004, the profitability realized on 2005 revenues was lower due to customer and project mix, and a lower proportion of service and smaller project revenues. Increases in selling and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. in the first quarter of 2005 were primarily driven by the impacts of an acquisition made in 2004, along with hiring of additional personnel in the systems integration businesses to meet the needs of certain large projects. These overhead cost increases fully offset the positive impact of higher sales volume in the quarter. Xcelecom's backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. of work to be completed has increased $15 million, or 9% percent compared to the same period of last year. Non-Utility Minority Interest Investments United Bridgeport Energy, Inc. UBE holds a 33 1/3% ownership interest in Bridgeport Energy, LLC (Logical Link Control) See "LANs" under data link protocol. LLC - Logical Link Control (BE). UBE had a loss of $2.7 million, or $0.19 per share in the first quarter of 2005, compared to a loss of $1.6 million, or $0.11 per share in the same quarter of 2004. First quarter 2005 results were approximately $0.12 per share lower than the same period of 2004 due to the costs of a planned outage that occurred in March and continued into April 2005. Excluding the impact of the outage, first quarter 2005 results were $0.04 per share better than the first quarter of 2004 due to higher revenues at the plant. In general, lower energy prices, high natural gas prices and the absence of a viable capacity market to provide incentive for generating plants to remain available, continue to negatively impact results. UBE's first quarter 2005 results were also impacted by legal fees associated with resolving a dispute between UBE and the majority owner of BE regarding UBE's contractual rights A contractual right is a claim, on other persons, that is acknowledged and perhaps reciprocated among the principals associated with that claim. Specialized contractual rights exist as part of a "contract" or agreement between persons to whom these rights belong. to sell its 33 1/3% interest in BE to the majority owner at fair market value, which reduced earnings by approximately $0.02 per share. United Capital Investments, Inc. UCI is a subsidiary of UIL which holds a number of passive and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. minority investments, including a 25% interest in Cross-Sound Cable, LLC (Cross-Sound), an entity that owns and operates a transmission line connecting Connecticut to Long Island under the Long Island Sound. During the first quarter of 2005, UCI reported net income of $0.1 million, or $0.01 per share, compared to a net loss of $0.1 million, or $0.01 per share, in the first quarter of 2004. The improvement from the prior year was due to an increase in earnings from Cross-Sound of $0.01 per share and better performance from UCI's passive investments. The remediation work required to bring the Cross-Sound cable into compliance with burial burial, disposal of a corpse in a grave or tomb. The first evidence of deliberate burial was found in European caves of the Paleolithic period. Prehistoric discoveries include both individual and communal burials, the latter indicating that pits or ossuaries were depth permit conditions set forth by the Connecticut Department of Environmental Protection was completed in January January: see month. 2005. UIL Corporate UIL retains certain costs at the holding company, or "corporate," level which are not allocated to the various non-utility subsidiaries. These costs generally include interest charges, and strategic and other administrative costs. UIL Corporate incurred unallocated after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. costs of $1.3 million, or $0.09 per share in the first quarter of 2005, compared to unallocated after-tax costs of $1.6 million, or $0.11 per share in the same quarter of 2004. The improvement from the first quarter of 2004 was mainly due to lower interest and administrative costs. Unallocated costs at UIL Corporate were partially offset by after-tax interest income earned on the loan to Cross-Sound totaling $0.2 million, or $0.01 per share, and $0.1 million, or $0.01 per share, for the first quarter of 2005 and 2004, respectively. Discontinued Operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. On June June: see month. 22, 2004, UIL completed the sale of American American, river, 30 mi (48 km) long, rising in N central Calif. in the Sierra Nevada and flowing SW into the Sacramento River at Sacramento. The discovery of gold at Sutter's Mill (see Sutter, John Augustus) along the river in 1848 led to the California gold rush of Payment Systems (APS) to CheckFree Corporation, a leading provider of financial electronic commerce services and products, pursuant to the purchase agreement entered into between the parties on December December: see month. 16, 2003. APS, and its 51% ownership interest in CellCards of Illinois Illinois, river, United States Illinois, river, 273 mi (439 km) long, formed by the confluence of the Des Plaines and Kankakee rivers, NE Ill., and flowing SW to the Mississippi at Grafton, Ill. It is an important commercial and recreational waterway. , LLC (CCI CCI Chambre de Commerce et d'Industrie (France) CCI CAM (Complementary and Alternative Medicine) Citation Index CCI Chamber of Commerce and Industry (Western Australia) ) were classified as discontinued operations in the fourth quarter of 2003. On February February: see month. 13, 2004, CCI was sold to an independent third party for book value, excluding transaction costs Transaction Costs Costs incurred when buying or selling securities. These include brokers' commissions and spreads (the difference between the price the dealer paid for a security and the price they can sell it). . Net income from discontinued operations amounted to $1.4 million, or $0.10 per share, in the first quarter of 2004. No operations were classified as discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: during the first quarter of 2005. Looking Forward UIL reaffirms its 2005 earnings guidance of $2.20 - $2.40 per share from continuing operations. The following chart shows a breakdown by business unit:
2005 Earnings Expectations
-------------------------------------------------------------------
UI $2.75 - $2.85
Xcelecom $0.20 - $0.30
UBE $(0.50) - $(0.40)
UCI $0.00 - $0.05
UIL Corporate $(0.40) - $(0.30)
Earnings from Continuing Operations for 2005(1) $2.20 - $2.40
-------------------------------------------------------------------
(1) Business unit expectations are not intended to be additive to
consolidated expectations.
Upcoming Events UIL will hold its Annual Meeting on Wednesday Wednesday: see week. , May 11, 2005 at 10 a.m. at Quinnipiac University Quinnipiac University is a private four-year university in Hamden, Connecticut, located on about 500 acres (2 km²), just north of New Haven. The campus is situated at the foot of Sleeping Giant State Park. in Hamden, Connecticut Hamden is a town in New Haven County, Connecticut, United States. The town's nickname is "The Land of the Sleeping Giant". History Hamden was originally settled by Puritans as part of the town of New Haven. . UIL Holdings Corporation (NYSE:UIL), headquartered in New Haven, Connecticut, is the holding company for a number of entities: The United Illuminating Company, a regulated utility providing electricity and energy related services to 320,000 customers in the Greater New Haven Greater New Haven is the metropolitan area whose extent includes those towns in the U.S. state of Connecticut that share an economic, social, political, and historical focus on the city of New Haven. It occupies the south-central portion of the state in a radius around New Haven. and Bridgeport areas; Xcelecom Inc., a leading provider of specialty contracting and voice-data-video systems integration; United Capital Investments, Inc., which holds a number of passive, minority investments, including a 25% interest in the Cross-Sound Cable Company, LLC; and United Bridgeport Energy, Inc., which holds a 33% interest in a gas-fired gas-fired adj → de gas gas-fired adj → au gaz gas-fired adj (heater etc) → Gas- merchant wholesale electric generating facility. For more information on UIL Holdings, visit us at http://www.uil.com. Certain statements contained herein, regarding matters that are not historical facts, 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. (as defined in 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). These include statements regarding management's intentions, plans, beliefs, expectations or forecasts for the future. Such forward-looking statements are based on UIL Holdings' expectations and involve risks and uncertainties; consequently, actual results may differ materially from those expressed or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. in the statements. Such risks and uncertainties include, but are not limited to, general economic conditions, legislative and 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. changes, changes in demand for electricity and other products and services, unanticipated weather conditions, changes in accounting principles, policies or guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. , and other economic, competitive, governmental, and technological factors affecting the operations, markets, products, services and prices of UIL Holdings' subsidiaries. The foregoing and other factors are discussed and should be reviewed in UIL Holdings' 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. and other subsequent periodic filings with the Securities and Exchange Commission. Forward-looking statements included herein speak only as of the date hereof here·of adv. Of this. hereof Adverb Formal or law of or concerning this Adv. 1. hereof - of or concerning this; "the twigs hereof are physic" and UIL Holdings undertakes no obligation to revise or update such statements to reflect events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date hereof or to reflect the occurrence of unanticipated events or circumstances. The following are summaries of UIL Holdings' 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: and segmented financial information for the first quarter 2005:
UIL HOLDINGS CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(Thousands except per share amounts)
(Unaudited)
Three Months Ended
March 31,
2005 2004
--------- ---------
Operating Revenues
Utility $186,916 $181,843
Non-utility businesses 91,624 67,584
--------- ---------
Total Operating Revenues 278,540 249,427
--------- ---------
Operating Expenses
Operation
Fuel and energy 95,167 87,938
Operation and maintenance 139,464 116,728
Depreciation and amortization 18,418 17,490
Taxes - other than income taxes 10,888 10,745
--------- ---------
Total Operating Expenses 263,937 232,901
--------- ---------
Operating Income From Continuing Operations 14,603 16,526
--------- ---------
Other Income and (Deductions), net 2,712 4,300
--------- ---------
Interest Charges, net
Interest on long-term debt 5,080 5,110
Other interest, net 549 722
--------- ---------
5,629 5,832
Amortization of debt expense and redemption
premiums 384 336
--------- ---------
Total Interest Charges, net 6,013 6,168
--------- ---------
Income From Continuing Operations Before
Income Taxes and Equity Earnings 11,302 14,658
--------- ---------
Income Taxes 4,342 6,066
--------- ---------
Income From Continuing Operations Before
Equity Earnings 6,960 8,592
Income (Losses) from Equity Investments (3,732) (2,900)
--------- ---------
Income From Continuing Operations 3,228 5,692
Discontinued Operations, Net of Tax - 1,443
--------- ---------
Net Income $ 3,228 $ 7,135
========= =========
Average Number of Common Shares Outstanding
- Basic 14,503 14,335
Average Number of Common Shares Outstanding
- Diluted 14,593 14,426
Earnings Per Share of Common Stock - Basic:
Continuing Operations $ 0.22 $ 0.40
Discontinued Operations - 0.10
--------- ---------
Net Earnings $ 0.22 $ 0.50
========= =========
Earnings Per Share of Common Stock - Diluted:
Continuing Operations $ 0.22 $ 0.39
Discontinued Operations - $ 0.10
--------- ---------
Net Earnings $ 0.22 $ 0.49
========= =========
Cash Dividends Declared per share of Common
Stock $ 0.72 $ 0.72
UIL HOLDINGS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
March 31, December 31,
(thousands of dollars) 2005 2004
--------------------------------------------------------------------
ASSETS
Current assets $ 250,292 $ 258,078
Property, plant and equipment, net 565,573 563,852
Regulatory assets 784,829 797,059
Other long-term assets 169,781 168,619
------------ ------------
Total Assets $ 1,770,475 $ 1,787,608
============ ============
LIABILITIES AND CAPITALIZATION
Current liabilities $ 193,925 $ 197,624
Noncurrent liabilities 142,716 147,434
Deferred income taxes 345,437 345,482
Regulatory liabilities 59,307 57,497
------------ ------------
Total Liabilities 741,385 748,037
Net long-term debt 486,888 491,174
Net common stock equity 542,202 548,397
------------ ------------
Total Capitalization 1,029,090 1,039,571
------------ ------------
Total Liabilities and
Capitalization $ 1,770,475 $ 1,787,608
============ ============
UIL HOLDINGS CORPORATION
SEGMENTED CONSOLIDATED INCOME STATEMENT
Quarter Ended
March 31,
(In Millions - Unaudited) 2005 2004
------------------------- ------- -------
Operating Revenue
UI from operations $186.9 $181.8
Xcelecom 91.6 67.6
------- -------
Total $278.5 $249.4
======= =======
Fuel and energy expense - UI $95.2 $87.9
======= =======
Operation and maintenance expense
UI $47.0 $48.4
Xcelecom 91.0 66.9
Minority Interest Investment and Other(1) 1.5 1.4
------- -------
Total $139.5 $116.7
======= =======
Depreciation and amortization
UI $7.5 $7.5
Xcelecom 0.9 0.9
------- -------
Subtotal depreciation 8.4 8.4
Amortization of regulatory assets (UI) 9.8 8.8
Amortization Xcelecom 0.2 0.3
------- -------
Total depreciation and amortization $18.4 $17.5
======= =======
Taxes - other than income taxes
UI - State gross earnings tax $5.9 $6.0
UI - other 4.3 4.0
Xcelecom 0.7 0.7
------- -------
Total $10.9 $10.7
======= =======
Other Income (Deductions)
UI - other $2.1 $3.6
Xcelecom 0.3 0.3
Minority Interest Investment and Other(1) 0.3 0.4
------- -------
Total $2.7 $4.3
======= =======
Interest Charges
UI $3.9 $4.1
UI - Amortization: debt expense,
redemption premiums 0.3 0.3
Xcelecom 0.3 0.1
Minority Interest Investment and Other(1) 1.5 1.7
------- -------
Total $6.0 $6.2
======= =======
Income Taxes
UI $7.4 $8.9
Xcelecom (0.5) (0.4)
Minority Interest Investment and Other(1) (2.6) (2.4)
------- -------
Total $4.3 $6.1
======= =======
Income (Losses) from Equity Investments
UI $0.1 $0.1
Minority Interest Investment(2) (3.8) (3.0)
------- -------
Total ($3.7) ($2.9)
======= =======
Net Income
UI $7.8 $9.6
Xcelecom (0.7) (0.6)
Minority Interest Investment and Other(1)(2) (3.9) (3.3)
------- -------
Subtotal Net Income from Continuing
Operations 3.2 5.7
Discontinued Operations 0.0 1.4
------- -------
Total Net Income $3.2 $7.1
======= =======
(1) The category "Minority Interest Investment and Other" includes
amounts recognized at the non-utility businesses in relation to their
minority interest investments, as well as unallocated holding company
costs.
(2) Includes income (losses) recognized at the non-utility
businesses in relation to their minority interest investments.
BUSINESS SEGMENT SUMMARY INFORMATION
(In Millions, except per share amounts)
----------------------------------------------------------------------
UIL HOLDINGS CORPORATION
----------------------------------------------------------------------
Quarter Quarter
Ended Ended
Mar. 31, Mar. 31,
2005 2004
--------- ---------
Income from Continuing Operations, net of tax $ 3.2 $ 5.7
Net Income $ 3.2 $ 7.1
Earnings per Share - basic $ 0.22 $ 0.50
----------------------------------------------------------------------
THE UNITED ILLUMINATING COMPANY
----------------------------------------------------------------------
Quarter Quarter
Ended Ended
Mar. 31, Mar. 31,
2005 2004
--------- ---------
Net Income $ 7.8 $ 9.6
Earnings per Share - basic $ 0.54 $ 0.67
Retail Sales (millions of KWH) 1,474 1,522(1)
(1) Includes 46 million KWH non-recurring adjustment associated with
a change in accounting estimate to unbilled revenue recognized in
Q1 2004.
----------------------------------------------------------------------
NON-UTILITY BUSINESSES
----------------------------------------------------------------------
Quarter Quarter
Ended Ended
Mar. 31, Mar. 31,
XCELECOM 2005 2004
-------- --------- ---------
Net Income $ (0.7) $ (0.6)
Earnings per Share - basic $ (0.05) $ (0.04)
MINORITY INTEREST INVESTMENT
AND OTHER
---------
Net Income $ (3.9) $ (3.3)
Earnings per Share - basic $ (0.27) $ (0.23)
DISCONTINUED OPERATIONS
-----------------------
Net Income $ - $ 1.4
Earnings per Share - basic $ - $ 0.10
TOTAL NON-UTILITY BUSINESSES
----------------------------
Net Income $ (4.6) $ (2.5)
Earnings per Share - basic $ (0.32) $ (0.17)
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