10-QPeriod: Q1 FY2014

XCEL ENERGY INC Quarterly Report for Q1 Ended Mar 31, 2014

Filed May 2, 2014For Securities:XELXELLL

Summary

Xcel Energy Inc. reported a net income of $261.2 million for the first quarter of 2014, an increase from $236.6 million in the same period of 2013. Diluted earnings per share rose to $0.52 from $0.48, driven by higher electric and natural gas margins, largely attributable to colder weather in key service territories and approved rate increases. Operating revenues also saw a significant increase to $3.20 billion from $2.78 billion year-over-year. The company's financial performance was bolstered by strong performance in its regulated electric and natural gas utility segments. Despite an increase in operating and maintenance expenses and property taxes, Xcel Energy managed to improve its profitability. Significant ongoing regulatory proceedings, such as rate cases in various states and environmental compliance initiatives, represent key areas for investors to monitor. Capital expenditures remained substantial, reflecting ongoing investments in infrastructure and transmission projects.

Financial Highlights

45 data points
Beta

Revenue

$3.20B

Net Income

$261.22M

8.2% Net Margin

EPS (Diluted)

$0.52

Total Assets

$34.20B

Cash & Equivalents

$132.31M

Free Cash Flow

$592.65M

Financial Statements
Beta
Revenue$3.20B
Operating Expenses$2.71B
Operating Income$493.99M
Interest Expense$139.09M
Net Income$261.22M
EPS (Basic)$0.52
EPS (Diluted)$0.52
Shares Outstanding (Basic)499.52M
Shares Outstanding (Diluted)499.75M

Key Highlights

  • 1Net income increased by 10.4% to $261.2 million for Q1 2014 compared to $236.6 million in Q1 2013.
  • 2Diluted earnings per share (EPS) grew to $0.52 in Q1 2014 from $0.48 in Q1 2013.
  • 3Total operating revenues increased by 15.1% to $3.20 billion in Q1 2014 compared to $2.78 billion in Q1 2013, driven by higher electric and natural gas sales and rate increases.
  • 4Operating income rose to $494.0 million from $454.6 million year-over-year.
  • 5Cash provided by operating activities decreased by $49 million to $592.6 million in Q1 2014, primarily due to changes in working capital.
  • 6Utility capital expenditures were $822.6 million in Q1 2014, compared to $752.3 million in Q1 2013, reflecting continued investment in infrastructure.
  • 7The company provided 2014 ongoing earnings guidance of $1.90 to $2.05 per share, with a long-term EPS growth objective of 4% to 6%.

Frequently Asked Questions

In the first quarter of 2014, Xcel Energy reported a net income of $261.2 million, or $0.52 per diluted share, representing an increase compared to the $236.6 million, or $0.48 per diluted share, reported in the same period of 2013. Total operating revenues increased to $3.20 billion, up from $2.78 billion in the prior year's first quarter. This growth was driven by higher electric and natural gas revenues, influenced by colder weather and approved rate increases across its service territories.

The primary drivers for the increase in revenue and net income were higher electric and natural gas margins. Colder weather in the service territories of NSP-Minnesota and NSP-Wisconsin led to increased energy consumption. Additionally, rate increases implemented in various jurisdictions across Xcel Energy's operating states contributed to higher revenues. These positive factors were partially offset by increased operating and maintenance expenses and property taxes.

Investors should monitor several ongoing regulatory proceedings. These include pending rate cases in multiple states (e.g., NSP-Minnesota's 2014 Electric Rate Case, SPS's Texas 2014 Electric Rate Case) which could impact future revenues and profitability. Additionally, environmental compliance initiatives, such as those related to air emissions (CSAPR, Regional Haze) and water quality (Clean Water Act), require significant investment and carry potential costs. Legal proceedings and potential environmental liabilities, such as the Ashland Manufactured Gas Plant site remediation, also present risks.

Xcel Energy continues to invest heavily in its infrastructure, with capital expenditures of $822.6 million in Q1 2014, up from $752.3 million in Q1 2013, primarily for transmission and generation projects. The company has a robust liquidity position, supported by committed credit facilities totaling $2.45 billion, of which $1.34 billion was available as of March 31, 2014. Xcel Energy plans to finance its capital needs through a combination of debt and equity issuances, as well as operating cash flows.