01—Abstract
Summary
Summary of the 10-K filed February 19, 2015. Cited figures are marked; the original filing is the authoritative source.
Consolidated Edison, Inc. (Con Edison) reported net income of $1,092 milliona, or $3.73 per diluted share, for the year ended December 31, 2014.
This represents an increase from the $1,062 millionb, 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.
02—Key points
Key Highlights
- Net 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.
- Earnings from ongoing operations improved to $1,140 million ($3.89/share) in 2014 from $1,112 million ($3.80/share) in 2013.
- The company invested $2,274 million in 2014 for utility infrastructure upgrades and plans to invest $2,912 million in 2015.
- Capital requirements for 2015 are expected to be met through internally generated funds and $1,000-$1,500 million in long-term debt issuance.
- CECONY's electric, gas, and steam delivery revenues are subject to revenue decoupling mechanisms, providing some insulation from volume fluctuations.
- O&R's New York electric and gas revenues are also subject to revenue decoupling mechanisms.
- The 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.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2014filed February 19, 2015Financial Statements
FY2014 against FY2013
| Line item | FY2014FY2013 | Change |
|---|---|---|
| Revenue | $12.92B$12.35B | +4.6% |
| R&D Expenses | $22.00M$18.00M | +22.2% |
| Operating Expenses | $10.76B$10.11B | +6.4% |
| Operating Income | $2.21B$2.24B | −1.6% |
| Interest Expense | $587.00M$578.00M | +1.6% |
| Net Income | $1.09B$1.06B | +2.8% |
| EPS (Basic) | $3.73$3.62 | +3.0% |
| EPS (Diluted) | $3.71$3.61 | +2.8% |
| Shares Outstanding (Basic) | 292.90M292.90M | 0.0% |
| Shares Outstanding (Diluted) | 294.00M294.40M | −0.1% |
05—Questions
Frequently Asked Questions
What was Con Edison's financial performance in 2014 compared to 2013?
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.
How is Con Edison planning to fund its capital expenditures for 2015?
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.
What are the key regulatory developments affecting Con Edison?
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.
What was the impact of the March 2014 explosion and fire on Con Edison?
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.
06—Continue