10-QPeriod: Q3 FY2017

CONSOLIDATED EDISON INC Quarterly Report for Q3 Ended Sep 30, 2017

Filed November 2, 2017For Securities:ED

Summary

Consolidated Edison, Inc. (Con Edison) and its subsidiary, Consolidated Edison Company of New York, Inc. (CECONY), reported financial results for the third quarter and the first nine months of 2017. The company is focused on providing reliable energy through its regulated utility operations and investing in contracted renewable and energy infrastructure projects. For the third quarter of 2017, Con Edison reported net income of $457 million, a decrease from $497 million in the same period of 2016. This decline was primarily influenced by the impact of changes in rate plans and regulatory charges, as well as lower operations and maintenance expenses primarily related to pensions and post-retirement benefits for CECONY, which were offset by higher depreciation and property taxes. The Clean Energy Businesses saw a significant decrease in operating income due to the prior year's gain from the sale of its retail electric supply business. Looking at the nine-month period, net income was $1,020 million, down from $1,039 million in the prior year. While regulated utility operations, particularly CECONY's gas segment, showed growth, this was largely offset by the aforementioned factors impacting the Clean Energy Businesses and changes in other operational costs.

Financial Highlights

44 data points
Beta

Revenue

$3.21B

Net Income

$457.00M

14.2% Net Margin

EPS (Diluted)

$1.48

Total Assets

$49.25B

Cash & Equivalents

$69.00M

Free Cash Flow

$590.00M

Financial Statements
Beta
Revenue$3.21B
Operating Expenses$2.30B
Operating Income$914.00M
Interest Expense$183.00M
Net Income$457.00M
EPS (Basic)$1.48
EPS (Diluted)$1.48
Shares Outstanding (Basic)307.80M
Shares Outstanding (Diluted)309.30M

Key Highlights

  • 1Net income for the third quarter of 2017 was $457 million, compared to $497 million in the third quarter of 2016.
  • 2For the nine months ended September 30, 2017, net income was $1,020 million, down from $1,039 million in the corresponding period of 2016.
  • 3CECONY's electric operating revenues decreased by $88 million in Q3 2017 compared to Q3 2016, primarily due to lower purchased power expenses.
  • 4CECONY's gas operating revenues increased by $60 million in Q3 2017 compared to Q3 2016, driven by higher revenues from the gas rate plan and customer growth.
  • 5The Clean Energy Businesses experienced a significant decrease in operating income for Q3 2017, largely due to the absence of a gain from the sale of the retail electric supply business in the prior year.
  • 6Con Edison Transmission continues to invest in electric and gas transmission projects, with the Mountain Valley Pipeline project receiving a FERC Certificate of Public Convenience and Necessity.
  • 7The company's common equity ratio remains strong, at 50.8% for Con Edison and 50.9% for CECONY as of September 30, 2017.

Frequently Asked Questions

The decrease in net income for the third quarter of 2017 was primarily due to changes in rate plans and regulatory charges, as well as a significant decrease in operating income from the Clean Energy Businesses, which benefited from a large gain on the sale of its retail electric supply business in the prior year. While regulated utility operations, particularly CECONY's gas segment, showed some positive contributions, these were not enough to offset the declines in other areas.

CECONY's electric operations saw a decrease in operating revenues primarily due to lower purchased power expenses. However, its gas operations reported an increase in operating revenues, driven by the gas rate plan and customer growth. O&R's electric operations experienced a slight decrease in operating revenues, while its gas operations saw a small increase, also influenced by gas purchased for resale and the gas rate plan.

Con Edison continues to be an industry leader in owning and operating contracted, large-scale solar generation. The Clean Energy Businesses saw a decrease in operating revenues in Q3 2017, largely due to the sale of its retail electric supply business in the prior year, though renewable revenues increased. Con Edison Transmission is actively investing in transmission and pipeline projects, notably the Mountain Valley Pipeline which received a key regulatory approval.

For the first nine months of 2017, cash flows from operating activities were lower than the prior year, mainly due to higher cash paid for income taxes. Investing activities showed a decrease in cash used compared to 2016, reflecting lower investments in transmission and renewable projects for Con Edison. Financing activities saw a significant decrease in net cash flows for Con Edison, offset by an increase for CECONY, driven by various debt issuances and equity offerings.