10-QPeriod: Q3 FY2016

DOMINION ENERGY, INC Quarterly Report for Q3 Ended Sep 30, 2016

Filed November 9, 2016For Securities:D

Summary

Dominion Energy, Inc. (D) reported a net income attributable to Dominion of $690 million for the third quarter of 2016, a 16% increase compared to the same period in the previous year, driven by higher renewable energy investment tax credits, increased electric utility sales due to favorable weather, and the positive impact of the new PJM capacity performance market. The company also completed the significant acquisition of Dominion Questar in September 2016, expanding its regulated gas operations. For the nine months ended September 30, 2016, net income attributable to Dominion rose by 8% to $1.67 billion. This growth was supported by similar factors as the quarterly increase, with the absence of a deferred fuel cost write-off also contributing. However, transaction and transition costs related to the Dominion Questar acquisition and lower gains from shale development rights impacted earnings. The company's balance sheet reflects increased property, plant, and equipment, and higher long-term debt, largely due to the Questar acquisition. Liquidity remains adequate, supported by substantial unused capacity under its credit facilities.

Financial Highlights

49 data points
Beta

Revenue

$3.13B

Net Income

$690.00M

22.0% Net Margin

EPS (Diluted)

$1.10

Total Assets

$69.60B

Cash & Equivalents

$251.00M

Free Cash Flow

-$18.00M

Financial Statements
Beta
Revenue$3.13B
Operating Expenses$1.99B
Operating Income$1.15B
Net Income$690.00M
EPS (Basic)$1.10
EPS (Diluted)$1.10
Shares Outstanding (Basic)625.90M
Shares Outstanding (Diluted)626.00M

Key Highlights

  • 1Third-quarter net income attributable to Dominion increased 16% to $690 million, with diluted EPS at $1.10.
  • 2Nine-month net income attributable to Dominion increased 8% to $1.67 billion, with diluted EPS at $2.71.
  • 3Completed the Dominion Questar Combination in September 2016, acquiring a Rockies-based integrated natural gas company for $4.4 billion.
  • 4Operating revenue increased 5.4% year-over-year for the third quarter, reaching $3.13 billion.
  • 5Total assets grew to $69.6 billion as of September 30, 2016, compared to $58.6 billion at December 31, 2015, primarily due to acquisitions.
  • 6Long-term debt increased significantly, reaching $28.7 billion as of September 30, 2016, up from $23.5 billion at December 31, 2015, driven by financing for the Dominion Questar acquisition.

Frequently Asked Questions

In the third quarter of 2016, Dominion Energy reported a net income attributable to Dominion of $690 million, or $1.10 per diluted share, an increase of 16% compared to $593 million ($1.00 per diluted share) in the third quarter of 2015.

The increase in earnings was primarily driven by higher renewable energy investment tax credits, increased electric utility sales due to favorable weather (cooling degree days), and the positive impact of the new PJM capacity performance market. These factors were partially offset by transaction and transition costs related to the Dominion Questar Combination.

Dominion completed the acquisition of Dominion Questar in September 2016 for $4.4 billion, integrating a Rockies-based natural gas company to balance its electric and gas operations. This significantly increased property, plant, and equipment, and long-term debt on the balance sheet.

Total assets increased from $58.6 billion at the end of 2015 to $69.6 billion at the end of the third quarter of 2016, primarily due to the Dominion Questar acquisition. Long-term debt also saw a substantial increase, reaching $28.7 billion from $23.5 billion, primarily to finance the acquisition.