Canadian Utilities Reports Higher Second Quarter 2013 Earnings
July 26 2013 - 6:55AM
Marketwired Canada
Canadian Utilities Limited (TSX:CU) (TSX:CU.X)
Canadian Utilities today reported higher earnings for the second quarter of 2013
led by continued investment in utility infrastructure to support Alberta growth.
Second quarter Adjusted Earnings were $131 million compared to $95 million for
the same period in 2012 driven by strong earnings contributions from the
utilities and power businesses.
Earnings attributable to equity owners were $160 million compared to $104
million in the same period in 2012. Adjusted Earnings will differ from earnings
attributable to equity owners because of the timing of recoveries from or
refunds to customers of amounts that are deferred by the Utilities for
regulatory purposes; however, over time there is no difference.
Adjusted Earnings were $311 million for the six months ended June 30, 2013
compared to $269 million in 2012. Earnings attributable to equity owners were
$343 million for the six months ended June 30, 2013 compared to $294 million in
2012.
The Hanna Region Transmission Development Project, which provides major
transmission reinforcement in southeast Alberta, was completed in July. The
project was delivered on schedule and under budget. Investment in Alberta's
utility infrastructure by ATCO Electric, ATCO Gas and ATCO Pipelines in the
second quarter was $463 million, bringing the total for the first six months of
2013 to $974 million. This capital expenditure exceeded the total investment for
the first half of 2012 by $37 million.
RECENT DEVELOPMENTS
-- In May 2013, Canadian Utilities' Board of Directors approved a two-for-
one share split of outstanding Class A non-voting and Class B common
shares. The split occurred on June 14, 2013 by way of a share dividend.
-- Canadian Utilities declared a third quarter dividend for 2013 of 24.25
cents per Class A non-voting and Class B common share, which amount
reflected the two-for-one share split. Canadian Utilities' annual
dividend per share has increased for 41 consecutive years.
-- On May 15, 2013, Canadian Utilities issued $225 million Cumulative
Redeemable Second Preferred Shares Series DD at a price of $25 per
share.
FINANCIAL SUMMARY AND RECONCILIATION OF ADJUSTED EARNINGS
A financial summary and reconciliation of Adjusted Earnings to earnings
attributable to equity owners is provided below:
For the Three Months For the Six Months
Ended June 30(4) Ended June 30(4)
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($Millions except share data) 2013 2012 2013 2012
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Adjusted Earnings (1) 131 95 311 269
Adjustments for Rate Regulated
Activities (2) 17 - 12 7
Dividends on Equity Preferred
Shares 12 9 20 18
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Earnings Attributable to Equity
Owners 160 104 343 294
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Revenues 845 685 1,721 1,496
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Funds Generated By Operations
(3) 431 292 842 703
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Weighted Average Shares
Outstanding (millions of
shares) 257.9 255.0 257.5 255.1
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(1) Adjusted Earnings are earnings attributable to equity owners after
adjusting for the timing of revenues and expenses associated with rate
regulated activities and dividends on equity preferred shares of
Canadian Utilities. Adjusted Earnings also exclude one-time gains and
losses and items that are not in the normal course of business or day-
to-day operations. Adjusted Earnings present earnings on the same basis
as was used prior to adopting International Financial Reporting
Standards (IFRS) - that basis being the U.S. accounting principles for
rate regulated entities - and they are a key measure used to assess
segment performance, to reflect the economics of rate regulation and to
facilitate comparability of Canadian Utilities' earnings with other
Canadian rate regulated companies.
(2) Refer to Note 5 to the consolidated financial statements for
descriptions of the adjustments for rate regulated activities and the
timing of their recovery from or refund to customers.
(3) This measure is cash flow from operations before changes in non-cash
working capital. It does not have standardized meaning under IFRS and
may not be comparable to similar measures used by other companies.
(4) 2012 financial information has been restated as a result of adopting new
and amended IFRS accounting standards that became effective in 2013.
Revenues in the second quarter and the first six months of 2013 increased
primarily due to increased rate base in the Utilities, higher power pool prices
in ATCO Power and higher flow through natural gas sales in ATCO Energy
Solutions' natural gas liquids extraction operations.
Funds Generated by Operations increased in the second quarter and the first six
months of 2013 primarily for the same reasons earnings increased.
Canadian Utilities' consolidated financial statements and management's
discussion and analysis for the three and six months ended June 30, 2013 will be
available on the Canadian Utilities website (www.canadianutilities.com), via
SEDAR (www.sedar.com) or can be requested from the Corporation.
Canadian Utilities Limited, an ATCO company, with more than 7,100 employees and
assets of approximately $14 billion, delivers service excellence and innovative
business solutions worldwide with leading companies engaged in utilities
(pipelines, natural gas and electricity transmission and distribution), energy
(power generation, natural gas gathering, processing, storage and liquids
extraction) and technologies (business systems solutions). More information can
be found at www.canadianutilities.com.
Forward-Looking Information:
Certain statements contained in this news release may constitute forward-looking
information. Forward-looking information is often, but not always, identified by
the use of words such as "anticipate", "plan", "estimate", "expect", "may",
"will", "intend", "should", and similar expressions. Forward-looking information
involves known and unknown risks, uncertainties and other factors that may cause
actual results or events to differ materially from those anticipated in such
forward-looking information. The Corporation believes that the expectations
reflected in the forward-looking information are reasonable, but no assurance
can be given that these expectations will prove to be correct and such
forward-looking information should not be unduly relied upon.
Any forward-looking information contained in this news release represents the
Corporation's expectations as of the date hereof, and is subject to change after
such date. The Corporation disclaims any intention or obligation to update or
revise any forward-looking information whether as a result of new information,
future events or otherwise, except as required by applicable securities
legislation.
FOR FURTHER INFORMATION PLEASE CONTACT:
Canadian Utilities Limited
B.R. (Brian) Bale
Senior Vice President & Chief Financial Officer
(403) 292-7502
www.canadianutilities.com
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