10-QPeriod: Q2 FY2015

NEXTERA ENERGY INC Quarterly Report for Q2 Ended Jun 30, 2015

Filed August 3, 2015For Securities:NEENEE-PNNEE-PSNEE-PTNEE-PWNEE-PVNEE-PU

Summary

NEXTERA ENERGY INC (NEE) reported strong financial performance for the six months ended June 30, 2015, with net income attributable to NEE increasing significantly to $1.37 billion, up from $921 million in the prior year period. This growth was driven by robust performance across its two main segments: Florida Power & Light (FPL) and NextEra Energy Resources (NEER). FPL demonstrated stable earnings, benefiting from investments in its infrastructure and a consistent regulatory return on equity. NEER saw a substantial uplift, largely due to favorable mark-to-market adjustments on non-qualifying hedges, which reversed prior year losses, and improved performance in its customer supply and trading operations, along with contributions from new investments in renewable energy projects. The company also maintained a strong liquidity position, with substantial available credit facilities, supporting its ongoing capital expenditure plans and strategic initiatives, including planned acquisitions. For the quarter ended June 30, 2015, net income attributable to NEE was $716 million, a notable increase from $492 million in the prior year. This quarterly improvement was also fueled by the strong performance of NEER, particularly the reversal of mark-to-market losses from non-qualifying hedges and contributions from new renewable energy assets. FPL continued to contribute steadily to earnings. The company's strategic focus on investing in infrastructure, expanding its renewable energy portfolio, and managing operational risks appears to be delivering positive financial results, positioning NEE favorably for continued growth.

Financial Highlights

43 data points
Beta

Net Income

$716.00M

EPS (Diluted)

$0.40

Total Assets

$77.20B

Cash & Equivalents

$551.00M

Free Cash Flow

$1.75B

Financial Statements
Beta
Operating Expenses$3.21B
Operating Income$1.15B
Net Income$716.00M
EPS (Basic)$0.40
EPS (Diluted)$0.40
Shares Outstanding (Basic)1.78B
Shares Outstanding (Diluted)1.80B

Key Highlights

  • 1Net income attributable to NEE increased significantly to $1.37 billion for the six months ended June 30, 2015, up from $921 million in the prior year period, indicating robust operational and financial performance.
  • 2The NEER segment experienced substantial growth, driven by a favorable shift in mark-to-market adjustments on non-qualifying hedges (from losses in 2014 to gains in 2015) and improved results from customer supply and proprietary trading activities, alongside contributions from new renewable energy investments.
  • 3FPL, the regulated utility segment, showed stable and increased net income, supported by ongoing investments in plant in service and a consistent regulatory return on equity.
  • 4The company maintained a strong liquidity position, with total net available liquidity of approximately $6.7 billion at June 30, 2015, providing ample resources for capital expenditures and strategic growth initiatives.
  • 5Capital expenditures remain significant, with planned investments totaling $13.7 billion to $15.1 billion for NEER and $13.9 billion to $15.6 billion for FPL through 2018, focusing on renewable energy expansion, infrastructure upgrades, and reliability improvements.
  • 6NEE's effective income tax rate for the six months ended June 30, 2015 was approximately 29%, benefiting from Production Tax Credits (PTCs) and Investment Tax Credits (ITCs) related to its renewable energy projects.

Frequently Asked Questions

For the six months ended June 30, 2015, net income attributable to NEE increased significantly to $1.37 billion, up from $921 million in the same period of 2014. For the three months ended June 30, 2015, net income attributable to NEE was $716 million, compared to $492 million in the prior year period.

The substantial increase in NEER's earnings was primarily driven by a favorable swing in mark-to-market adjustments on non-qualifying hedges (moving from losses in 2014 to gains in 2015), improved results from customer supply and proprietary power and gas trading, and contributions from new renewable energy investments, partially offset by lower results from existing assets and gas infrastructure.

FPL demonstrated stable and increased net income, with an increase of $24 million for the six months ended June 30, 2015. This growth was primarily driven by higher earnings on investments in plant in service, reflecting growth in its average retail rate base, and higher Allowance for Funds Used During Construction (AFUDC) - equity. The company continues to benefit from its regulatory framework allowing it to earn an 11.50% regulatory ROE.

NEE maintained a strong liquidity position with approximately $6.7 billion in net available liquidity at June 30, 2015. The company has substantial planned capital expenditures, with NEER expecting to invest $13.7 billion to $15.1 billion and FPL expecting to invest $13.9 billion to $15.6 billion through 2018, primarily directed towards renewable energy expansion, infrastructure upgrades, and reliability improvements.