10-KPeriod: FY2012

CMS ENERGY CORP Annual Report, Year Ended Dec 31, 2012

Filed February 21, 2013For Securities:CMSCMS-PCCMSACMSCCMSD

Summary

CMS Energy Corporation (CMS) and its primary subsidiary, Consumers Energy Company, reported revenues of $6.3 billion and $6.0 billion respectively for the fiscal year ended December 31, 2012. The company's performance was largely driven by its electric and gas utility operations, which constitute the majority of its assets and income. During the year, CMS Energy navigated a complex regulatory environment, with the Michigan Public Service Commission (MPSC) authorizing rate increases for both electric and gas services. However, the company also incurred a significant write-off related to its electric revenue decoupling mechanism, impacting overall earnings. Looking ahead, CMS Energy has outlined a substantial capital investment program of approximately $7 billion from 2013 through 2017, primarily focused on enhancing reliability, environmental compliance, and infrastructure upgrades. This includes plans for new gas-fueled power generation and significant investments in renewable energy. The company is also managing various risks, including regulatory changes, environmental compliance costs, and economic conditions in Michigan, which could affect future financial performance and operational strategies.

Financial Highlights

45 data points
Beta

Revenue

$6.25B

Net Income

$384.00M

6.1% Net Margin

EPS (Diluted)

$1.42

Total Assets

$17.13B

Cash & Equivalents

$93.00M

Free Cash Flow

$14.00M

Financial Statements
Beta
Revenue$6.25B
Operating Expenses$5.25B
Operating Income$1.00B
Interest Expense$389.00M
Net Income$384.00M
EPS (Basic)$1.46
EPS (Diluted)$1.42
Shares Outstanding (Diluted)268.60M

Key Highlights

  • 1CMS Energy reported consolidated revenues of $6.3 billion for the year ended December 31, 2012, with Consumers Energy contributing $6.0 billion.
  • 2The company relies heavily on its regulated electric and gas utility operations, which comprise the majority of its assets and income.
  • 3CMS Energy received MPSC authorization for rate increases for its electric and gas utility services during the year.
  • 4A significant electric revenue decoupling mechanism regulatory asset write-off impacted the company's net income.
  • 5A capital investment program of approximately $7 billion is planned for 2013-2017, focusing on infrastructure, environmental compliance, and new generation.
  • 6The company is exposed to various risks including regulatory changes, environmental compliance costs, and economic conditions in its service territory.
  • 7CMS Energy manages a diverse portfolio of operations including independent power production and a banking subsidiary (EnerBank).

Frequently Asked Questions

CMS Energy reported total revenues of $6.3 billion for the fiscal year ended December 31, 2012. Net income available to common stockholders was $382 million, or $1.42 per diluted share, which was a decrease from $415 million, or $1.58 per diluted share, in 2011. This decrease was primarily due to a write-off of a regulatory asset and the absence of a tax benefit recognized in the prior year, partially offset by improved operating results at Consumers Energy.

CMS Energy plans to invest approximately $7 billion from 2013 through 2017. These investments will focus on enhancing system reliability, meeting environmental regulations, upgrading infrastructure, and developing new power generation, including a proposed 700-MW gas-fueled plant. The company also expects to invest in renewable energy projects.

CMS Energy and its subsidiary Consumers Energy are significantly impacted by regulation from the Michigan Public Service Commission (MPSC) and the Federal Energy Regulatory Commission (FERC). Key regulatory matters include rate cases, approval of capital investments, and compliance with environmental regulations. The company experienced a write-off of an electric revenue decoupling mechanism regulatory asset due to a court ruling, which impacted earnings.

CMS Energy faces several risks, including changes in environmental and energy regulations, volatility in energy commodity prices, the ability to access capital markets, economic conditions in Michigan, and potential disruptions due to cyber attacks or other catastrophic events. The company also noted potential impacts from proposed legislation to change alternative electric supply limits.