Summary
Dominion Energy, Inc.'s 2012 10-K filing reveals a challenging year marked by a significant net income attributable to Dominion of $302 million, a substantial decrease from $1.408 billion in 2011. This decline was primarily driven by a $1.6 billion impairment charge related to the planned sale or decommissioning of merchant generation facilities like Brayton Point and Kincaid, and a $415 million impairment related to the decision to cease operations at the Kewaunee nuclear plant. The company is actively transitioning its business mix towards a greater emphasis on regulated operations, targeting 80-90% of its earnings from these segments. This strategy is supported by significant capital investments in regulated electric and natural gas infrastructure. While non-regulated segments, particularly merchant generation, faced headwinds including lower realized prices and a sustained decline in commodity prices, Dominion is taking steps to divest or retire underperforming assets. The regulated DVP and Dominion Energy segments showed more stability, with DVP benefiting from rate adjustments and Dominion Energy seeing growth from new transmission and distribution projects. Looking ahead to 2013, Dominion anticipates an increase in net income per share, driven by the absence of major impairment charges, a return to normal weather patterns, and continued growth from its regulated infrastructure projects. The company remains focused on delivering earnings per share growth, a growing dividend, and maintaining a stable credit profile.
Financial Highlights
53 data points| Revenue | $12.84B |
| Operating Expenses | $9.98B |
| Operating Income | $2.86B |
| Net Income | $302.00M |
| EPS (Basic) | $0.53 |
| EPS (Diluted) | $0.53 |
| Shares Outstanding (Basic) | 572.90M |
| Shares Outstanding (Diluted) | 573.90M |
Key Highlights
- 1Net income attributable to Dominion decreased by 79% year-over-year to $302 million in 2012, significantly impacted by impairment charges on merchant generation assets.
- 2Dominion is strategically shifting towards regulated operations, aiming for 80-90% of earnings from these segments.
- 3The company incurred substantial impairment charges totaling approximately $2.1 billion in 2012 related to merchant power stations (Brayton Point, Kincaid) and the Kewaunee nuclear plant.
- 4Capital expenditures in 2012 focused on regulated infrastructure, with planned investments of $4.7 billion, $4.2 billion, and $3.3 billion for 2013, 2014, and 2015, respectively.
- 5Virginia Power (a subsidiary) reported net income of $1.05 billion in 2012, an increase from $822 million in 2011, benefiting from rate adjustments and the absence of prior year charges.
- 6Dominion announced a new dividend policy targeting a payout ratio of 65-70% and increased its annual dividend rate for 2013 by 6.6% to $2.25 per share.
- 7The company anticipates a return to normal weather in 2013, contributing to expected earnings per share growth, alongside the absence of major impairment charges.