01—Abstract
Summary
Summary of the 10-K filed February 22, 2011. Cited figures are marked; the original filing is the authoritative source.
Consolidated Edison, Inc. (Con Edison) and its subsidiary, Consolidated Edison Company of New York, Inc. (CECONY), reported solid financial performance for the fiscal year ended December 31, 2010.
Con Edison's primary earnings driver remains its regulated utility businesses, CECONY and Orange and Rockland Utilities (O&R), which are expected to continue generating the majority of the company's income. The company reported increased operating revenues for both Con Edison and CECONY, driven by rate plan adjustments and increased energy delivery volumes. Con Edison's net income for common stock rose to $992 milliona in 2010, an increase from $868 million in 2009, with diluted earnings per share of $3.47.
The company highlighted significant investments in upgrading its energy delivery infrastructure, with CECONY investing $1.87 billionb and O&R investing $135 million. Con Edison also maintained a stable common equity ratio, around 50%, and demonstrated a consistent ability to access capital markets to fund its operations and investments.
02—Key points
Key Highlights
- Con Edison's net income increased to $992 million in 2010, up from $868 million in 2009, with diluted EPS of $3.47.
- CECONY made substantial capital investments, spending $1.87 billion on upgrading its energy delivery systems in 2010.
- O&R also invested $135 million in its energy delivery systems.
- The company's regulated utilities (CECONY and O&R) are expected to remain the primary contributors to earnings.
- Con Edison's common equity ratio remained strong, hovering around 50% throughout the reporting period.
- The company issued $305 million of common stock and $925 million of debentures by CECONY and $170 million by O&R, indicating continued access to capital markets.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2010filed February 22, 2011Financial Statements
FY2010 against FY2009
| Line item | FY2010FY2009 | Change |
|---|---|---|
| Revenue | $13.32B$13.03B | +2.2% |
| R&D Expenses | $23.00M$27.00M | −14.8% |
| Operating Expenses | $11.21B$11.13B | +0.6% |
| Operating Income | $2.12B$1.90B | +11.6% |
| Interest Expense | $597.00M$590.00M | +1.2% |
| Net Income | $992.00M$868.00M | +14.3% |
| EPS (Basic) | $3.49$3.16 | +10.4% |
| EPS (Diluted) | $3.47$3.14 | +10.5% |
| Shares Outstanding (Basic) | 284.30M275.20M | +3.3% |
| Shares Outstanding (Diluted) | 285.90M276.30M | +3.5% |
05—Questions
Frequently Asked Questions
What is Con Edison's primary business and revenue source?
Con Edison is a holding company whose primary businesses are its regulated utility subsidiaries: Consolidated Edison Company of New York, Inc. (CECONY) and Orange and Rockland Utilities, Inc. (O&R). These utilities deliver electricity, natural gas, and steam services. CECONY serves New York City and Westchester County, while O&R serves parts of southeastern New York, northern New Jersey, and northeastern Pennsylvania. The company also has competitive energy businesses, but the regulated utilities are expected to provide substantially all of its earnings.
How did Con Edison perform financially in 2010 compared to 2009?
Con Edison reported an increase in net income for common stock to $992 million in 2010, up from $868 million in 2009. Diluted earnings per share also increased to $3.47 in 2010 from $3.14 in 2009. This growth was driven by higher operating revenues, primarily due to rate plan adjustments and increased energy delivery volumes, as well as the operating results of its competitive energy businesses.
What are Con Edison's major capital expenditure areas?
Con Edison's major capital expenditures are focused on upgrading and reinforcing its energy delivery infrastructure to ensure safety and reliability. In 2010, CECONY invested $1.87 billion and O&R invested $135 million in their respective energy delivery systems. These investments are crucial for meeting growing energy demands and maintaining service quality.
How is Con Edison regulated, and how does this impact its financials?
Con Edison's utility subsidiaries, CECONY and O&R, are heavily regulated by state utility commissions, primarily the New York State Public Service Commission (NYSPSC) and the New Jersey Board of Public Utilities (NJBPU). These commissions approve rate plans, which dictate the prices the utilities can charge customers and allow them to recover their costs, including capital investments. Rate plans often include mechanisms like revenue decoupling, which can mitigate the impact of volume fluctuations on revenues, and provisions for cost reconciliations, allowing recovery of certain expenses.
06—Continue