10-QPeriod: Q2 FY2002

CONSOLIDATED EDISON INC Quarterly Report for Q2 Ended Jun 30, 2002

Filed August 12, 2002For Securities:ED

Summary

Consolidated Edison, Inc. (Con Edison) reported mixed financial results for the quarter and six months ended June 30, 2002. For the three months ended June 30, 2002, net income for common stock decreased to $97.6 million ($0.46 per share) from $100.7 million ($0.48 per share) in the prior year period. This decline was attributed to economic softness and lower operating revenues, partially offset by reduced operating expenses. For the six months ended June 30, 2002, net income for common stock also saw a decrease, reaching $264.2 million ($1.24 per share), down from $279.8 million ($1.32 per share) in the same period of 2001. The decline was primarily driven by mild winter weather and a general economic slowdown, which impacted sales volumes, though these were partially counteracted by lower operating expenses. The company's liquidity saw a decrease in unrestricted cash and temporary cash investments during the first six months of 2002.

Key Highlights

  • 1Operating revenues decreased by $212.0 million (10.0%) for the three months ended June 30, 2002, compared to the prior year, primarily due to lower electricity sales and the sale of the nuclear generating unit.
  • 2Net income for common stock for the three months ended June 30, 2002, was $97.6 million, a decrease from $100.7 million in the same period of 2001.
  • 3Earnings per common share (basic and diluted) for the three months ended June 30, 2002, were $0.46, down from $0.48 in the prior year.
  • 4For the six months ended June 30, 2002, operating revenues decreased by $999.1 million (20.0%) compared to the prior year, largely due to lower energy prices and volumes.
  • 5Net income for common stock for the six months ended June 30, 2002, was $264.2 million, a decrease from $279.8 million in the prior year.
  • 6Net cash flows from operating activities for the six months ended June 30, 2002, were $349.6 million, a decrease of $49.7 million from the prior year period.
  • 7Con Edison's common equity ratio stood at 48.2% as of June 30, 2002, unchanged from December 31, 2001.

Frequently Asked Questions

For the quarter ended June 30, 2002, Con Edison experienced a slight decrease in net income for common stock to $97.6 million, or $0.46 per share, compared to $100.7 million, or $0.48 per share, in the same period of the prior year. This decline was primarily due to lower operating revenues and the impact of economic softness, partially offset by reduced operating expenses.

Con Edison's unrestricted cash and temporary cash investments decreased by $212.2 million during the first six months of 2002. This reduction was influenced by operating, investing, and financing activities, including the use of restricted cash for debt retirement.

Operating revenues decreased significantly in both the three-month and six-month periods ended June 30, 2002. Key factors contributing to this decrease included lower electricity sales volumes due to economic conditions and mild weather, lower energy prices, and revenue reductions related to the prior year's sale of Con Edison of New York's nuclear generating unit.

The company is involved in several legal proceedings, including those related to hazardous substances and previously disclosed matters concerning the nuclear generating unit and Northeast Utilities. Regulatory matters include an approved three-year gas rate agreement and ongoing reviews of wholesale electricity market design by the FERC. The company is also addressing costs incurred in connection with the World Trade Center attack.

The Electric segment saw a decrease in operating revenues and operating income, impacted by lower sales and the sale of the nuclear unit. The Gas segment also reported lower revenues and income due to milder weather and rate reductions. The Steam segment experienced lower revenues but an increase in operating income. Overall, the utility segments were affected by weather patterns and economic conditions.