10-QPeriod: Q1 FY2009

CONSOLIDATED EDISON INC Quarterly Report for Q1 Ended Mar 31, 2009

Filed May 1, 2009For Securities:ED

Summary

Consolidated Edison, Inc. (Con Edison) and its subsidiary, Consolidated Edison Company of New York, Inc. (Con Edison of New York), reported their first-quarter results for 2009. The company experienced a notable decrease in net income for common stock, falling to $180 million from $303 million in the same period of 2008. This decline was primarily driven by a significant drop in earnings from competitive energy businesses, largely due to mark-to-market losses, and a decrease in the regulated utility operations, particularly Con Edison of New York. Despite the lower net income, operating revenues for the combined entities saw a slight decrease, mainly impacted by reduced activity in the competitive energy segments. Con Edison of New York received an approved electric rate increase of $523 million effective April 6, 2009, which is expected to positively influence future financial performance. The company also continues to make substantial capital investments in its utility infrastructure, reflecting ongoing efforts to maintain reliability and meet future demand.

Financial Highlights

1 data points
Beta

Net Income

$180.00M

Financial Statements
Beta
Net Income$180.00M

Key Highlights

  • 1Net income for common stock significantly decreased by 40.6% to $180 million in Q1 2009 compared to $303 million in Q1 2008.
  • 2Operating revenues for Con Edison decreased by 4.3% to $3,423 million in Q1 2009 compared to $3,577 million in Q1 2008, primarily due to the competitive energy businesses.
  • 3Con Edison of New York received an electric rate increase of $523 million effective April 6, 2009, following a PSC order.
  • 4Utility construction expenditures remained substantial, with Con Edison reporting $526 million and Con Edison of New York reporting $397 million for Q1 2009.
  • 5Long-term debt for Consolidated Edison, Inc. increased significantly to $9,980 million from $9,232 million as of December 31, 2008.
  • 6The company is facing investigations and potential penalties related to contractor payments and permit non-compliance at steam generating facilities, with the financial impact currently uncertain.
  • 7Despite lower net income, the common equity ratio remained healthy at 48.9% for Con Edison and 48.8% for Con Edison of New York as of March 31, 2009.

Frequently Asked Questions

The primary driver for the decrease in net income for Con Edison was a significant drop in earnings from its competitive energy businesses, largely due to mark-to-market losses, and a decrease in earnings from its regulated utility operations, particularly Con Edison of New York.

Yes, Con Edison of New York received an approved electric rate increase of $523 million, effective April 6, 2009, following a Public Service Commission (PSC) order.

Con Edison is exposed to various market risks including interest rate risk, commodity price risk, and credit risk. For derivative instruments, the company utilizes risk management strategies. At March 31, 2009, Con Edison had significant derivative assets and liabilities, with energy derivatives being a major component. The company also has credit exposure to counterparties in its energy supply and hedging activities.

Yes, Con Edison of New York is involved in an internal investigation concerning contractor payments, for which the financial impact is currently unpredictable. Additionally, the New York State Department of Environmental Conservation (DEC) has issued a proposed order concerning non-compliance and pollution discharges at the company's steam generating facilities, which could result in penalties and substantial compliance costs that are currently not quantifiable.