10-QPeriod: Q1 FY2015

DOMINION ENERGY, INC Quarterly Report for Q1 Ended Mar 31, 2015

Filed May 5, 2015For Securities:D

Summary

Dominion Energy (D) reported its first quarter 2015 results, showing a significant increase in net income attributable to Dominion, rising 41% year-over-year to $536 million, with diluted EPS increasing to $0.91 from $0.65 in the prior year. This improvement was primarily driven by the absence of losses related to the repositioning of the producer services business and the sale of the electric retail energy marketing business in 2014, as well as increased revenue from regulated operations. The company's balance sheet shows total assets of $55.16 billion and total liabilities of $42.74 billion as of March 31, 2015. Key financial activities during the quarter included strong operating cash flow of $1.13 billion, an increase from $753 million in the prior year, largely supporting significant investing activities, including the $495 million acquisition of DCGT, a natural gas pipeline company. Financing activities provided $325 million in net cash, bolstered by common stock issuances. While the company is navigating various regulatory and environmental matters, it maintains ample liquidity with $1.3 billion in unused capacity under its credit facilities.

Financial Highlights

47 data points
Beta

Revenue

$3.41B

Net Income

$536.00M

15.7% Net Margin

EPS (Diluted)

$0.91

Total Assets

$55.16B

Cash & Equivalents

$275.00M

Free Cash Flow

$117.00M

Financial Statements
Beta
Revenue$3.41B
Operating Expenses$2.41B
Operating Income$1.00B
Net Income$536.00M
EPS (Basic)$0.91
EPS (Diluted)$0.91
Shares Outstanding (Basic)587.90M
Shares Outstanding (Diluted)589.90M

Key Highlights

  • 1Net income attributable to Dominion increased 41% to $536 million ($0.91 diluted EPS) in Q1 2015, up from $379 million ($0.65 diluted EPS) in Q1 2014.
  • 2Operating cash flows saw a substantial increase, reaching $1.13 billion in Q1 2015 compared to $753 million in Q1 2014.
  • 3Acquisition of DCGT (Dominion Carolina Gas Transmission) for $495 million in January 2015, bolstering Dominion's regulated gas position in the Southeast.
  • 4Total assets grew to $55.16 billion as of March 31, 2015, from $54.33 billion as of December 31, 2014.
  • 5Long-term debt decreased to $21.35 billion as of March 31, 2015, down from $21.81 billion as of December 31, 2014.
  • 6The company held $275 million in cash and cash equivalents as of March 31, 2015.
  • 7Dominion maintained significant liquidity with $1.3 billion in unused capacity under its credit facilities.

Frequently Asked Questions

The significant increase in net income was primarily driven by the absence of losses related to the repositioning of Dominion's producer services business and the sale of its electric retail energy marketing business in 2014. These factors, combined with improved performance in regulated operations and an increase in rider revenue, contributed to the 41% year-over-year growth in net income.

Dominion's major investing activity was the $495 million acquisition of DCGT, a natural gas pipeline company, which strengthens its presence in the Southeast. Financially, the company saw a net increase of $325 million from financing activities, notably due to the issuance of common stock through an at-the-market program and a reduction in net debt issuances compared to the prior year.

Dominion's total long-term debt decreased slightly to $21.35 billion as of March 31, 2015. The company ended the quarter with $275 million in cash and cash equivalents and maintained substantial liquidity, with $1.3 billion in unused capacity available under its credit facilities, indicating a strong ability to meet its short-term and long-term financial obligations.

Yes, Dominion is subject to various regulatory and environmental matters. Key items include ongoing proceedings related to electric transmission rates, fuel expense recovery in Virginia, and environmental regulations concerning air emissions (MATS, CSAPR) and water discharges (CWA Section 316(b)). The company is also evaluating compliance costs for new regulations on coal combustion residuals (CCRs) and greenhouse gas emissions. While the company has rate recovery mechanisms for some of these costs, potential impacts on financial position and cash flows are being monitored.