Dominion Resources (NYSE: D) today announced unaudited reported earnings determined in accordance with Generally Accepted Accounting Principles (reported earnings) for the three months ended June 30, 2016, of $452 million ($0.73 per share) compared with earnings of $413 million ($0.70 per share) for the same period in 2015.
Operating earnings for the three months ended June 30, 2016, amounted to $441 million ($0.71 per share), compared to operating earnings of $429 million ($0.73 per share) for the same period in 2015. Operating earnings are defined as reported earnings adjusted for certain items.
The principal difference between reported earnings and operating earnings for the quarter is related to our investments in nuclear decommissioning trust funds.
Dominion uses operating earnings as the primary performance measurement of its earnings guidance and results for public communications with analysts and investors. Dominion also uses operating earnings internally for budgeting, for reporting to the Board of Directors, for the company’s incentive compensation plans and for its targeted dividend payouts and other purposes. Dominion management believes operating earnings provide a more meaningful representation of the company’s fundamental earnings power.
Thomas F. Farrell II, chairman, president and chief executive officer, said:
“Our second-quarter operating earnings were in the upper half of our guidance range of $0.65 to $0.75 per share.
“Strong operational and safety performance continued in the second quarter. In addition, several milestones were reached in our growth projects. The 1,385-megawatt Brunswick County Power Station commenced commercial operations in April, ahead of schedule and under budget. We also began construction on the 1,588-megawatt Greensville County combined cycle power station. We are looking forward to getting this state-of-the-art power station operating and providing energy to more than 400,000 customers.
“The Cove Point Liquefaction project is now 67 percent complete and continues on time and on budget for a late 2017 in-service date. We continue to work toward the construction of the Atlantic Coast Pipeline and the related Supply Header project with an expected completion date of late 2018.”
SECOND-QUARTER 2016 REPORTED AND OPERATING EARNINGS COMPARED TO 2015
Reported earnings increased 3 cents per share as compared to second-quarter 2015. Business segment results and detailed descriptions of items included in 2016 and 2015 reported earnings but excluded from operating earnings can be found on Schedules 1, 2 and 3 of this release.
Operating earnings decreased 2 cents per share as compared to second-quarter 2015 operating earnings. The decrease in operating earnings was primarily attributable to milder weather, a planned refueling outage at Millstone, and share dilution. Positive factors included revenues from our regulated growth projects, lower capacity expenses and a farmout transaction. Details of second-quarter 2016 operating earnings as compared to the same period in 2015 may be found on Schedule 4 of this release.
THIRD-QUARTER 2016 OPERATING EARNINGS GUIDANCE
Dominion expects third-quarter 2016 operating earnings in the range of $0.95-$1.10 per share, compared to third-quarter 2015 operating earnings of $1.03 per share. Positive drivers include increased revenues from our growth projects and lower capacity expenses offset by the absence of a farmout transaction and share dilution. Reconciliation of reported and operating earnings for the third quarter of 2015 can be found on Schedule 3 of this release.
The company is maintaining its previously issued 2016 operating earnings guidance of $3.60-$4.00 per share.
In providing its third-quarter and full-year operating earnings guidance, the company notes that there could be differences between expected reported earnings and estimated operating earnings for matters such as, but not limited to, acquisitions, divestitures or changes in accounting principles. At this time, Dominion management is not able to estimate the aggregate impact of these items on future period reported earnings.
CONFERENCE CALL TODAY
Dominion will host its second-quarter earnings conference call at 10 a.m. ET on Wednesday, Aug. 3, 2016. Management will discuss second-quarter financial results and other matters of interest to the financial community.
Domestic callers should dial (877) 410-5657. International callers should dial (334) 323-9872. The passcode for the conference call is “Dominion.” Participants should dial in 10 to 15 minutes prior to the scheduled start time. Members of the media also are invited to listen.
A live webcast of the conference call, including accompanying slides, and other financial information will be available on the investor information pages at www.dom.com/investors and www.dommidstream.com/investors.
A replay of the conference call will be available beginning about 1 p.m. ET Aug. 3 and lasting until 11 p.m. ET Aug. 10. Domestic callers may access the recording by dialing (877) 919-4059. International callers should dial (334) 323-0140. The PIN for the replay is 79755313. Additionally, a replay of the webcast will be available on the investor information pages by the end of the day Aug. 3.
