10-KPeriod: FY2014

CONSOLIDATED EDISON INC Annual Report, Year Ended Dec 31, 2014

Filed February 19, 2015For Securities:ED

Summary

Consolidated Edison, Inc. (Con Edison) reported net income of $1,092 million, or $3.73 per diluted share, for the year ended December 31, 2014. This represents an increase from the $1,062 million, or $3.62 per diluted share, reported in 2013. Earnings from ongoing operations, which exclude certain one-time items, also showed improvement, rising to $1,140 million, or $3.89 per diluted share, from $1,112 million, or $3.80 per diluted share, in the prior year. The company's core utility businesses, primarily CECONY and O&R, continue to be the main drivers of earnings, supported by approved rate plans designed to cover service costs and capital investments. Con Edison is actively investing in its energy delivery systems, with significant capital expenditures planned for 2015. The company anticipates funding these capital requirements through internally generated funds and the issuance of long-term debt, without the need for issuing common equity beyond existing plans. Despite a significant explosion and fire in March 2014 that led to investigations and potential liabilities, the company is navigating regulatory changes and planning for future growth in its service territories.

Financial Highlights

49 data points
Beta

Revenue

$12.92B

Net Income

$1.09B

8.5% Net Margin

EPS (Diluted)

$3.71

Total Assets

$44.07B

Cash & Equivalents

$699.00M

Free Cash Flow

$2.65B

Financial Statements
Beta
Revenue$12.92B
R&D Expenses$22.00M
Operating Expenses$10.76B
Operating Income$2.21B
Interest Expense$587.00M
Net Income$1.09B
EPS (Basic)$3.73
EPS (Diluted)$3.71
Shares Outstanding (Basic)292.90M
Shares Outstanding (Diluted)294.00M

Key Highlights

  • 1Net income increased to $1,092 million in 2014 from $1,062 million in 2013, with diluted earnings per share rising to $3.73 from $3.62.
  • 2Earnings from ongoing operations improved to $1,140 million ($3.89/share) in 2014 from $1,112 million ($3.80/share) in 2013.
  • 3The company invested $2,274 million in 2014 for utility infrastructure upgrades and plans to invest $2,912 million in 2015.
  • 4Capital requirements for 2015 are expected to be met through internally generated funds and $1,000-$1,500 million in long-term debt issuance.
  • 5CECONY's electric, gas, and steam delivery revenues are subject to revenue decoupling mechanisms, providing some insulation from volume fluctuations.
  • 6O&R's New York electric and gas revenues are also subject to revenue decoupling mechanisms.
  • 7The company is managing regulatory changes, including the New York State's 'Reforming the Energy Vision' (REV) proceeding, which aims to improve system efficiency and encourage distributed energy resources.

Frequently Asked Questions

Con Edison reported an increase in net income to $1,092 million ($3.73 per diluted share) in 2014 from $1,062 million ($3.62 per diluted share) in 2013. Earnings from ongoing operations also saw an increase, rising to $1,140 million ($3.89 per diluted share) from $1,112 million ($3.80 per diluted share) in the prior year.

Con Edison expects to meet its 2015 capital requirements through internally generated funds and the issuance of between $1,000 million and $1,500 million of long-term debt. The company does not anticipate needing to issue common equity in 2015, beyond what is issued through its dividend reinvestment, employee stock purchase, and long-term incentive plans.

Con Edison is subject to various regulatory developments. In New York, the NYSPSC adopted a Joint Proposal for CECONY's rates for 2014-2015, initiated the 'Reforming the Energy Vision' (REV) proceeding to improve system efficiency and encourage distributed energy resources, and is investigating practices related to gas facilities. O&R has also filed for rate increases in New York and New Jersey. Furthermore, CECONY has filed for an electric rate increase in New York for 2016.

In March 2014, an explosion and fire destroyed buildings served by CECONY, resulting in fatalities and injuries. Investigations by the National Transportation Safety Board and the NYSPSC are ongoing. The company has not accrued a liability for the incident as of the filing date, but is exposed to potential liabilities and is cooperating with the investigations.