Summary
Xcel Energy Inc. (XEL) announced a significant settlement with Provident Life & Accident Insurance Company on July 6, 2010, resolving all claims related to its discontinued corporate-owned life insurance program. The company will receive a total of $25 million, with $15 million funded by Provident and $10 million by Reassure America Life Insurance Company. This settlement is expected to be recorded in the third quarter of 2010 and will contribute approximately $0.05 per share in non-recurring earnings. Investors should note that this settlement is considered a one-time event and is not expected to impact ongoing operational earnings. While this infusion of cash provides a positive, albeit non-recurring, boost to earnings, the company also reiterates its forward-looking statements are subject to various risks and uncertainties inherent in the energy industry.
Key Highlights
- 1Xcel Energy Inc. (XEL) settled all claims with Provident Life & Accident Insurance Company related to its discontinued corporate-owned life insurance program.
- 2The total settlement amount is $25 million, to be paid by July 16, 2010.
- 3$15 million of the settlement will be funded by Provident Life & Accident Insurance Company.
- 4$10 million of the settlement will be funded by Reassure America Life Insurance Company.
- 5The settlement is expected to be recognized as non-recurring earnings in the third quarter of 2010.
- 6The settlement is anticipated to add approximately $0.05 per share to earnings.
- 7Xcel Energy views this settlement as a non-recurring event, not indicative of ongoing earnings.