8-KOther Events

EVERSOURCE ENERGY 8-K Report (Apr 25, 2001)

Filed April 25, 2001For Securities:ES

Summary

Northeast Utilities (NU) reported its first-quarter 2001 earnings, showcasing a significant increase in net income compared to the prior year, driven primarily by a substantial non-recurring gain from the sale of its Millstone Nuclear Station interests to Dominion Resources, Inc. While the reported earnings per share (EPS) of $0.78 reflect this gain, the company also incurred a charge related to the adoption of SFAS-133 and a non-cash charge associated with a previous share repurchase program. Excluding these non-recurring items, NU's core operating earnings were $0.36 per share, impacted by planned nuclear plant refueling and a rate reduction at a subsidiary. The company provided an updated full-year 2001 operating earnings projection of $1.40 to $1.60 per share, excluding non-recurring items. Key operational factors influencing results included reduced earnings from regulated subsidiaries due to refueling outages and a rate reduction, partially offset by stronger performance from Yankee Energy Services, Inc. and a slight decline in electric companies' operation and maintenance costs, bolstered by a voluntary separation program expected to yield future savings. The company also anticipates a reduction in outstanding shares following the closure of its forward share purchase program.

Key Highlights

  • 1Reported Q1 2001 earnings of $112.2 million, or $0.78 per diluted share, a significant increase from $74.6 million, or $0.55 per diluted share, in Q1 2000.
  • 2Included a substantial after-tax gain of $124.8 million ($0.87 per share) from the sale of Millstone Nuclear Station interests to Dominion Resources, Inc.
  • 3Recorded a $22.4 million ($0.15 per share) charge related to the adoption of SFAS-133 (Accounting for Derivative Instruments and Hedging Activities).
  • 4Recognized a $43.4 million ($0.30 per share) non-cash charge related to a forward share purchase program, which is expected to be closed out in Q2 2001.
  • 5Core operating earnings, excluding non-recurring items, were $53.2 million, or $0.36 per share, down from the prior year's comparable period.
  • 6Maintains projected full-year 2001 operating earnings between $1.40 and $1.60 per share (excluding non-recurring items).
  • 7Anticipates reducing outstanding share count from approximately 144 million to 134 million shares after closing the forward share purchase.

Frequently Asked Questions

The primary driver was a significant after-tax gain of $124.8 million ($0.87 per share) recognized from the sale of Northeast Utilities' (NU) Millstone Nuclear Station interests to Dominion Resources, Inc. on March 31, 2001.

The adoption of SFAS-133, which deals with accounting for derivative instruments and hedging activities, resulted in a one-time charge of $22.4 million, or $0.15 per share, impacting net income for the quarter.

Excluding non-recurring items, Northeast Utilities continues to project its operating earnings for the full year 2001 to be in the range of $1.40 to $1.60 per share.

Core operating earnings of regulated subsidiaries were reduced by the scheduled refueling of the Millstone 3 nuclear plant, which led to higher costs and lower revenues. Additionally, a 5% rate reduction that took effect at subsidiary PSNH on October 1, 2000, also contributed to lower earnings.