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Press release from PR Newswire

Duke Energy Posts Second Quarter 2013 Results

Wednesday, August 07, 2013

Duke Energy Posts Second Quarter 2013 Results

07:00 EDT Wednesday, August 07, 2013

-- Second quarter 2013 adjusted diluted earnings per share (EPS) were $0.87, compared to $1.02 for the second quarter 2012
-- Reported diluted EPS for second quarter 2013 was $0.48, compared to $0.99 for the second quarter 2012
-- Company reaffirms 2013 adjusted earnings guidance range of $4.20 to $4.45 per share

CHARLOTTE, N.C., Aug. 7, 2013 /PRNewswire/ -- Duke Energy (NYSE: DUK) today announced second quarter 2013 adjusted diluted EPS of $0.87, compared to $1.02 for second quarter 2012, and reported diluted EPS of $0.48, compared to $0.99 for the same period last year.

(Logo: http://photos.prnewswire.com/prnh/20130322/CL81938LOGO )

Reported results include special items that are excluded from the company's adjusted diluted EPS results. Special items for the second quarter 2013 primarily include $0.26 per share in charges related to a write-off of investment balances in Crystal River 3, $0.08 per share in charges related to a write-off of nuclear development costs, $0.07 per share in merger costs to achieve, and $0.04 per share in charges for litigation reserves related to the company's former investment in Crescent Resources.

On an adjusted EPS basis, U.S. Franchised Electric & Gas, the company's largest business unit, overcame milder weather to post favorable results in the second quarter of 2013 primarily due to the addition of Progress Energy's utility operations. However, these results were offset by the impact of share dilution from the merger and lower quarterly results at both the Commercial Power and International Energy business units.

Additionally, the company reaffirmed its 2013 adjusted earnings guidance range of $4.20 to $4.45 per share and expects stronger adjusted earnings in the second half of the year as the company implements revised customer rates and continues to achieve efficiencies from the merger transaction.

"After one year, we have had tremendous success coming together as one, stronger company," said President and CEO Lynn Good. "We're delivering on our promises to customers, shareholders and our communities. We continue making progress with our near-term priorities, positioning Duke Energy for long-term financial and operational success.

"We are on track to achieve our 2013 adjusted diluted earnings per share guidance range of $4.20 to $4.45. We are keenly focused on achieving our financial objectives, supported by realizing constructive regulatory outcomes, maximizing cost efficiencies from our merger, and optimizing the performance in all of our operations," she said.

BUSINESS UNIT RESULTS The discussion below of second quarter results includes adjusted segment income, which is a non-GAAP financial measure. The tables on pages 22 through 25 present a reconciliation of reported results to adjusted results.

U.S. Franchised Electric and Gas (USFE&G) USFE&G recognized second quarter 2013 adjusted segment income of $590 million, compared to $337 million in the second quarter 2012, an increase of $0.36 per share.

USFE&G's increased results were primarily driven by the addition of Progress Energy's regulated utility operations in the Carolinas and Florida and merger savings at these operations (+$0.38 per share).

Other drivers included:

  • Increased pricing and riders (+$0.02 per share) primarily related to the implementation of revised customer rates in Duke Energy Ohio's regulated electric operations and energy efficiency programs in the company's regulated business
  • Lower operations and maintenance expenses primarily driven by the reduced number of nuclear outage days and the achievement of merger synergies (+$0.02 per share)

These results were partially offset by milder weather (-$0.05 per share) and a decrease in the Allowance for Funds Used During Construction (AFUDC) equity primarily due to the completion of certain major capital projects (-$0.02 per share).

International Energy International Energy recognized second quarter 2013 adjusted segment income of $87 million, compared to $105 million in the second quarter 2012, a decrease of $0.03 per share.

International Energy's quarterly results decreased primarily due to lower volumes resulting from an extended planned maintenance outage at National Methanol Company (-$0.02 per share).

Commercial Power Commercial Power recognized a second quarter 2013 adjusted segment loss of $3 million, compared to adjusted segment income of $32 million in the second quarter 2012, a decrease of $0.05 per share.

Commercial Power's quarterly performance decreased primarily due to lower results from the Midwest coal and gas generation fleets (-$0.07 per share) principally due to lower PJM capacity revenues, lower generation volumes and the prior year recovery of a previously written-off receivable from Lehman Brothers.

Other On an adjusted basis, Other primarily includes corporate interest expense not allocated to the business units, results from Duke Energy's captive insurance company, other investments, and quarterly income tax levelization adjustments.

Other recognized second quarter 2013 adjusted net expense of $57 million, compared to adjusted net expense of $18 million in the second quarter 2012, a difference of $0.06 per share. Other's results were primarily due to the addition of interest expense on Progress Energy holding company's corporate debt (-$0.03 per share) and increased Duke Energy holding company interest expense (-$0.02 per share).

Share Issuance On July 2, 2012, Duke Energy issued approximately 258 million shares of common stock in connection with the closing of the merger with Progress Energy Inc. The issuance of these additional shares had a dilutive impact of $0.37 per share on the quarter-over-quarter adjusted diluted EPS results.

Analyst conference call An earnings conference call for analysts is scheduled for 10 a.m. ET today to discuss Duke Energy's financial performance for the quarter and provide other business updates. The conference call will be hosted by Lynn Good, president and chief executive officer. 

The call can be accessed via the investors' section (http://www.duke-energy.com/investors/) of Duke Energy's website or by dialing 877-675-4749 in the United States or 719-325-4903 outside the United States. The confirmation code is 8727874. Please call in 10 to 15 minutes prior to the scheduled start time.

A replay of the conference call will be available until 1 p.m. ET, Aug. 17, 2013, by calling 888-203-1112 in the United States or 719-457-0820 outside the United States and using the code 8727874. A replay and transcript also will be available by accessing the investors' section of the company's website.

Special Items and Non-GAAP Reconciliation Mark-to-market impacts of economic hedges in the Commercial Power segment and special items affecting Duke Energy's adjusted diluted EPS for the quarters include:

2Q2013

2Q2012

Pretax

Tax

EPS

EPS

(In millions, except per-share

Amount

Effect

Impact

Impact

amounts)

Second Quarter 2013

 - Crystal River Unit 3 impairment

$(295)

$115

$(0.26)

 - Nuclear development costs

$(87)

$30

$(0.08)

 - Costs to achieve, Progress merger

$(82)

$31

$(0.07)

 - Litigation reserve

$(50)

$19

$(0.04)

 - Mark-to-market impact of

   economic hedges

$69

$(25)

$0.06

 - Discontinued operations, net of tax

$(5)

$2

--

Second Quarter 2012

 - Costs to achieve, Progress merger

$(7)

--

$(0.02)

 - Mark-to-market impact of

   economic hedges

$(6)

$2

$(0.01)

Total diluted EPS impact

$(0.39)

$(0.03)

 

Reconciliation of reported-to-adjusted diluted EPS for the quarters:

2Q2013

EPS

2Q2012

EPS

Diluted EPS, as reported

$0.48

$0.99

Adjustments to reported EPS:

 - Diluted EPS impact of special items, mark-to-market in 

   Commercial Power and discontinued operations             

 

$0.39

 

$0.03

Diluted EPS, adjusted

$0.87

$1.02

 

Non-GAAP financial measures The primary performance measure used by management to evaluate segment performance is segment income. Segment income is defined as income from continuing operations net of income attributable to non-controlling interests. In addition, direct interest expense and income taxes are included in segment income and certain governance costs are allocated to each of the segments.

Management believes segment income, which is the GAAP measure used to report segment results, is a good indicator of each segment's operating performance as it represents the approximate net income contribution of Duke Energy's business segments by incorporating the direct financing methods or capital structures of the business segments as well as the income tax attributes of the businesses and regions in which they operate.

Duke Energy's management uses adjusted diluted EPS, which is a non-GAAP financial measure as it represents diluted EPS from continuing operations attributable to Duke Energy Corporation common shareholders, adjusted for the per-share impact of special items and the mark-to-market impacts of economic hedges in the Commercial Power segment, as a measure to evaluate operations of the company. In addition, Duke Energy's management calculates the EPS impact of segment income drivers to facilitate an understanding of the impacts of each income driver on consolidated adjusted diluted EPS.

Special items represent certain charges and credits, which management believes will not be recurring on a regular basis, although it is reasonably possible such charges and credits could recur. Mark-to-market adjustments reflect the mark-to-market impact of derivative contracts, which is recognized in GAAP earnings immediately as such derivative contracts do not qualify for hedge accounting or regulatory accounting treatment, used in Duke Energy's hedging of a portion of the economic value of its generation assets in the Commercial Power segment. The economic value of the generation assets is subject to fluctuations in fair value due to market price volatility of the input and output commodities (e.g. coal, power, gas) and, as such, the economic hedging involves both purchases and sales of those input and output commodities related to the generation assets. Because the operations of the generation assets are accounted for under the accrual method, management believes that excluding the impact of mark-to-market changes of the economic hedge contracts from adjusted earnings until settlement better matches the financial impacts of the hedge contract with the portion of the economic value of the underlying hedged asset. Management believes that the presentation of adjusted diluted EPS provides useful information to investors, as it provides them an additional relevant comparison of the company's performance across periods. Adjusted diluted EPS is also used as a basis for employee incentive bonuses. The most directly comparable GAAP measure for adjusted diluted EPS is reported diluted EPS from continuing operations attributable to Duke Energy Corporation common shareholders, which includes the impact of special items and the mark-to-market impacts of economic hedges in the Commercial Power segment. Due to the forward-looking nature of adjusted diluted EPS for future periods, information to reconcile such non-GAAP financial measures to the most directly comparable GAAP financial measures is not available at this time, as the company is unable to forecast special items and the mark-to-market impacts of economic hedges in the Commercial Power segment for future periods.

Duke Energy also uses adjusted segment income and adjusted Other net expenses as a measure of historical and anticipated future segment and Other performance. Adjusted segment income and adjusted Other net expenses are non-GAAP financial measures, as they represent reported segment income and Other net expenses adjusted for special items and the mark-to-market impacts of economic hedges in the Commercial Power segment. Management believes that the presentation of adjusted segment income and adjusted Other net expenses provides useful information to investors, as it provides them an additional relevant comparison of a segment's or Other's performance across periods. When an EPS amount is provided for a segment income driver, the per share impact is derived by taking the before-tax amount of the item less income taxes based on Duke Energy's consolidated effective tax rate, divided by the Duke Energy weighted-average diluted shares outstanding for the period. The most directly comparable GAAP measure for adjusted segment income or adjusted Other net expenses is reported segment income or Other net expenses, which represents segment income and Other net expenses from continuing operations, including any special items and the mark-to-market impacts of economic hedges in the Commercial Power segment. Due to the forward-looking nature of any forecasted adjusted segment income or adjusted Other net expenses and any related growth rates for future periods, information to reconcile these non-GAAP financial measures to the most directly comparable GAAP financial measures is not available at this time, as the company is unable to forecast special items, the mark-to-market impacts of economic hedges in the Commercial Power segment, or any amounts that may be reported as discontinued operations or extraordinary items for future periods.

Duke Energy is the largest electric power holding company in the United States with more than $110 billion in total assets. Its regulated utility operations serve approximately 7.2 million electric customers located in six states in the Southeast and Midwest. Its commercial power and international business segments own and operate diverse power generation assets in North America and Latin America, including a growing portfolio of renewable energy assets in the United States.

Headquartered in Charlotte, N.C., Duke Energy is a Fortune 250 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available at duke-energy.com. 

Forward-Looking Information This release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are based on management's beliefs and assumptions.

These forward-looking statements are identified by terms and phrases such as "anticipate," "believe," "intend," "estimate," "expect," "continue," "should," "could," "may," "plan," "project," "predict," "will," "potential," "forecast," "target," "guidance," "outlook" and similar expressions. Forward-looking statements involve risks and uncertainties that may cause actual results to be materially different from the results predicted. Factors that could cause actual results to differ materially from those indicated in any forward-looking statement include, but are not limited to: state, federal and foreign legislative and regulatory initiatives, including costs of compliance with existing and future environmental requirements or climate change, as well as rulings that affect cost and investment recovery or have an impact on rate structures or market prices; the ability to recover eligible costs, including those associated with future significant weather events, and earn an adequate return on investment through the regulatory process; the costs of retiring Crystal River Unit 3 could prove to be more extensive than is currently identified, all costs associated with the retirement Crystal River Unit 3 asset, including replacement power may not be fully recoverable through the regulatory process; the ability to maintain relationships with customers, employees or suppliers; the risk that the credit ratings of the combined company or its subsidiaries may be different from what the companies expect; the impact of compliance with material restrictions or conditions related to the Progress Energy merger imposed by regulators could exceed our expectations; costs and effects of legal and administrative proceedings, settlements, investigations and claims; industrial, commercial and residential growth or decline in service territories or customer bases resulting from customer usage patterns, including energy efficiency efforts and use of alternative energy sources including self-generation and distributed generation technologies; additional competition in electric markets and continued industry consolidation; political and regulatory uncertainty in other countries in which Duke Energy conducts business; the influence of weather and other natural phenomena on operations, including the economic, operational and other effects of severe storms, hurricanes, droughts and tornadoes; the ability to successfully operate electric generating facilities and deliver electricity to customers; the impact on facilities and business from a terrorist attack, cyber security threats and other catastrophic events; the inherent risks associated with the operation and potential construction of nuclear facilities, including environmental, health, safety, regulatory and financial risks; the timing and extent of changes in commodity price, interest rates and foreign currency exchange rates and the ability to recover such costs through the regulatory process, where appropriate, and their impact on liquidity positions and the value of underlying assets; the results of financing efforts, including the ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general economic conditions; declines in the market prices of equity securities and resultant cash funding requirements for defined benefit pension plans, other post-retirement benefit plans, and nuclear decommissioning trust funds; changes in rules for regional transmission organizations, including changes in rate designs and new and evolving capacity markets, and risks related to obligations created by the default of other participants; the ability to control operation and maintenance costs; the level of creditworthiness of counterparties to transactions; employee workforce factors, including the potential inability to attract and retain key personnel; the ability of subsidiaries to pay dividends or distributions to Duke Energy Corporation holding company (the Parent); the performance of projects undertaken by our nonregulated businesses and the success of efforts to invest in and develop new opportunities; the effect of accounting pronouncements issued periodically by accounting standard-setting bodies; the impact of potential goodwill impairments; the ability to reinvest retained earnings of foreign subsidiaries or repatriate such earnings on a tax free basis; and the ability to successfully complete future merger, acquisition or divestiture plans.

Additional risks and uncertainties are identified and discussed in Duke Energy's and its subsidiaries' reports filed with the SEC and available at the SEC's website at www.sec.gov. In light of these risks, uncertainties and assumptions, the events described in the forward-looking statements might not occur or might occur to a different extent or at a different time than Duke Energy has described. Forward looking statements speak only as of the date they are made, Duke Energy undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise that occur after that date.

Media Contact: Tom Shiel Office: 704.382.2355 | 24-Hour: 800.559.3853

Analysts: Bob Drennan Office: 704.382.4070

Analysts: Bill Currens Office: 704.382.1603

 

DUKE ENERGY CORPORATION

EARNINGS VARIANCES

June 2013 QTD vs. Prior Year

($ per share)

U.S. Franchised

Electric & Gas

International

Energy

Commercial

Power

Other

Consolidated

2012 QTD Reported Earnings Per Share, Diluted

$

0.76

$

0.24

$

0.06

$

(0.07)

$

0.99

Costs to Achieve, Progress Merger

-

-

-

0.02

0.02

Economic Hedges (Mark-to-Market)

-

-

0.01

-

0.01

2012 QTD Adjusted Earnings Per Share, Diluted

$

0.76

$

0.24

$

0.07

$

(0.05)

$

1.02

Share Differential (a)

(0.28)

(0.09)

(0.02)

0.02

(0.37)

2012 QTD Adjusted Earnings Per Share, Diluted, Recasted for Share Issuance

$

0.48

$

0.15

$

0.05

$

(0.03)

$

0.65

Progress Energy Contribution

0.38

-

-

(0.03)

0.35

Weather

(0.05)

-

-

-

(0.05)

Pricing and Riders (b)

0.02

-

-

-

0.02

Latin America, including Foreign Exchange Rates (c)

-

(0.01)

-

-

(0.01)

National Methanol Company

-

(0.02)

-

-

(0.02)

Midwest Coal Generation (d)

-

-

(0.02)

-

(0.02)

Midwest Gas Generation (e)

-

-

(0.05)

-

(0.05)

Interest Expense 

(0.01)

-

0.01

(0.02)

(0.02)

Change in effective income tax rate

-

-

0.01

(0.02)

(0.01)

Other (f)

0.02

-

-

0.01

0.03

2013 QTD Adjusted Earnings Per Share, Diluted

$

0.84

$

0.12

$

(0.00)

$

(0.09)

$

0.87

Crystal River Unit 3 Impairment

(0.26)

-

-

-

(0.26)

Nuclear Development Charges

(0.08)

-

-

-

(0.08)

Costs to Achieve, Progress Merger

-

-

-

(0.07)

(0.07)

Litigation Reserve

-

-

-

(0.04)

(0.04)

Economic Hedges (Mark-to-Market)

-

-

0.06

-

0.06

2013 QTD Reported Earnings Per Share, Diluted

$

0.50

$

0.12

$

0.06

$

(0.20)

$

0.48

Note 1: Earnings Per Share amounts are calculated using the consolidated effective income tax rate.

Note 2: Adjusted and Reported Earnings Per Share amounts by segment may not recompute from other published schedules due to rounding.

(a)

Reflects the impact on prior period earnings per diluted share due to the increase in Duke Energy's weighted-average diluted common shares outstanding as a result of shares issued to complete the merger with Progress Energy. Weighted-average diluted shares outstanding increased from 446 million for the quarter ended June 30, 2012 to 706 million for the quarter ended June 30, 2013.

(b)

Primarily due to the May 2013 implementation of revised distribution rates in Ohio as a result of the 2012 Duke Energy Ohio rate case (+$0.01) and earnings on energy efficiency programs (+$0.01).

(c) 

Primarily due to unfavorable foreign currency exchange rates (-$0.01).

(d)

Primarily due to a decrease in capacity revenues received from PJM in 2013 (-$0.02).

(e)

Primarily due to a decrease in capacity revenue (-$0.02), decreased generation margins due to lower volumes (-$0.01) and the prior-year recovery of a previously written-off Lehman Brothers receivable (-$0.01). 

(f)

Amount for U.S. Franchised Electric & Gas includes a decrease in operations and maintenance expense, net of recoverables (+$0.02), higher wholesale revenues, including new contracts (+$0.01), and increased retail volumes (+$0.01), partially offset by a decrease in AFUDC-equity (-$0.02).

 

DUKE ENERGY CORPORATION

EARNINGS VARIANCES

June 2013 YTD vs. Prior Year

($ per share)

U.S. Franchised

Electric & Gas

International

Energy

Commercial

Power

Other

Consolidated

2012 YTD Reported Earnings Per Share, Diluted

$

1.06

$

0.55

$

0.13

$

(0.09)

$

1.65

Costs to Achieve, Progress Merger

-

-

-

0.03

0.03

Edwardsport Charges

0.60

-

-

-

0.60

Voluntary Opportunity Plan Deferral

(0.13)

-

-

-

(0.13)

Economic Hedges (Mark-to-Market)

-

-

0.01

-

0.01

2012 YTD Adjusted Earnings Per Share, Diluted

$

1.53

$

0.55

$

0.14

$

(0.06)

$

2.16

Share Differential (a)

(0.57)

(0.20)

(0.05)

0.02

(0.80)

2012 YTD Adjusted Earnings Per Share, Diluted, Recasted for Share Issuance

$

0.96

$

0.35

$

0.09

$

(0.04)

$

1.36

Progress Energy Contribution

0.72

-

-

(0.06)

0.66

Weather

0.06

-

-

-

0.06

Pricing and Riders (b)

0.03

-

-

-

0.03

Latin America, including Foreign Exchange Rates (c)

-

(0.05)

-

-

(0.05)

National Methanol Company

-

(0.03)

-

-

(0.03)

Midwest Coal Generation (d)

-

-

(0.04)

-

(0.04)

Midwest Gas Generation (e)

-

-

(0.09)

-

(0.09)

Duke Energy Retail 

-

-

0.01

-

0.01

Interest Expense

-

-

0.02

(0.03)

(0.01)

Change in effective income tax rate

(0.02)

-

0.01

(0.01)

(0.02)

Other (f)

0.01

(0.01)

-

0.01

0.01

2013 YTD Adjusted Earnings Per Share, Diluted

$

1.76

$

0.26

$

-

$

(0.13)

$

1.89

Crystal River Unit 3 Impairment

(0.26)

-

-

-

(0.26)

Nuclear Development Charges

(0.08)

-

-

-

(0.08)

Costs to Achieve, Progress Merger

-

-

-

(0.13)

(0.13)

Litigation Reserve

-

-

-

(0.04)

(0.04)

Economic Hedges (Mark-to-Market)

-

-

(0.01)

-

(0.01)

2013 YTD Reported Earnings Per Share, Diluted

$

1.42

$

0.26

$

(0.01)

$

(0.30)

$

1.37

Note 1: Earnings Per Share amounts are calculated using the consolidated effective income tax rate.

Note 2: Adjusted and Reported Earnings Per Share amounts by segment may not recompute from other published schedules due to rounding.

(a)

Reflects the impact on prior period earnings per diluted share due to the increase in Duke Energy's weighted-average diluted common shares outstanding as a result of shares issued to complete the merger with Progress Energy.  Weighted-average diluted shares outstanding increased from 446 million for the six months ended June 30, 2012, to 706 million for the six months ended June 30, 2013.

(b)

Primarily due to the timing of the implementation of revised customer rates in North Carolina and South Carolina as a result of the 2011 Duke Energy Carolinas rate case (+$0.03). The revised rates in North Carolina and South Carolina were implemented in February 2012, resulting in only four months of increased rates in six months ended June 30, 2012, compared to six months in six months ended June 30, 2013.

(c) 

Primarily driven by higher average purchase power costs and lower volumes due to unfavorable hydrology (-$0.03) in Brazil and unfavorable foreign exchange rates (-$0.02), partially offset by higher volumes and lower fuel costs (+$0.01) in Central America . 

(d)

Primarily due to lower capacity revenues received from PJM  (-$0.06).

(e)

Primarily due to a decrease in capacity revenue (-$0.04), decreased generation margins due to lower volumes (-$0.03) and the prior-year recovery of a previously written-off Lehman Brothers receivable (-$0.01). 

(f)

Amount for U.S. Franchised Electric & Gas is primarily due to wholesale growth from new contracts (+$0.03) and a decrease in operations and maintenance expenses, net of recoverables (+$0.02) partially offset by a decrease in AFUDC-equity (-$0.04).

 

June 2013

QUARTERLY HIGHLIGHTS

(Unaudited)

Three Months Ended

Six Months Ended

June 30,

June 30,

(In millions, except per-share amounts and where noted)

2013

2012

2013

2012

COMMON STOCK DATA

Income from continuing operations attributable to Duke Energy Corporation common shareholders

    Basic

$             0.48

$             0.99

$             1.37

$             1.65

    Diluted

$             0.48

$             0.99

$             1.37

$             1.65

Income from discontinued operations attributable to Duke Energy Corporation common shareholders

    Basic

$                   -

$                   -

$                   -

$                   -

    Diluted

$                   -

$                   -

$                   -

$                   -

Net income attributable to Duke Energy Corporation common shareholders

    Basic

$             0.48

$             0.99

$             1.37

$             1.65

    Diluted

$             0.48

$             0.99

$             1.37

$             1.65

  Dividends Declared Per Share

$           1.545

$           1.515

$             2.31

$           2.265

  Weighted-Average Shares Outstanding

    Basic

706

446

705

446

    Diluted

706

446

706

446

SEGMENT INCOME BY BUSINESS SEGMENT

U.S. Franchised Electric and Gas(a)(b)(c)

$              353

$              337

$           1,009

$              473

Commercial Power

41

28

(1)

59

International Energy

87

105

184

247

Total Reportable Segment Income

481

470

1,192

779

Other Net Expense(d)

(139)

(25)

(216)

(41)

Income from Discontinued Operations, net of tax

(3)

(1)

(3)

1

Net Income Attributable to Duke Energy Corporation

$              339

$              444

$              973

$              739

CAPITALIZATION

Total Common Equity

49%

51%

Total Debt

51%

49%

Total Debt

$         41,408

$         21,386

Book Value Per Share

$           56.95

$           50.46

Actual Shares Outstanding

706

446

CAPITAL AND INVESTMENT EXPENDITURES

U.S. Franchised Electric and Gas

$           1,250

$              795

$           2,543

$           1,590

Commercial Power

42

411

67

620

International Energy

14

9

26

24

Other

64

39

128

63

Total Capital and Investment Expenditures

$           1,370

$           1,254

$           2,764

$           2,297

(a) Includes an impairment charge of $180 million for the three and six months ended June 30, 2013 related to Crystal River Unit 3 Nuclear Station (net of tax of $115 million).  

(b) Includes impairment charges of $57 million for the three and six months ended June 30, 2013 related to nuclear development costs (net of tax of $30 million).  

(c) Includes impairment and other charges of $268 million in the first quarter of 2012 related to the Edwardsport IGCC project (net of tax of $152 million).  

(d) Includes costs to achieve the Progress merger of $51 million for the three months ended June 30, 2013 (net of tax of $31 million), and $85 million for the six months ended June 30, 2013 

      (net of tax of $52 million).

 

June 2013

QUARTERLY HIGHLIGHTS

(Unaudited)

Three Months Ended

Six Months Ended

June 30,

June 30,

(In millions, except where noted)

2013

2012

2013

2012

U.S. FRANCHISED ELECTRIC AND GAS

  Operating Revenues

$                 4,920

$                 2,697

$                 9,980

$                 5,365

  Operating Expenses (a)(b)(c)

4,165

2,099

8,005

4,481

  Gains on Sales of Other Assets, net

4

3

6

7

  Operating Income (Loss)

759

601

1,981

891

  Other Income and Expenses

48

62

109

124

  Interest Expense

242

143

478

289

  Income Before Income Taxes

565

520

1,612

726

  Income Tax Expense(d)(e)(f)

212

183

603

253

  Segment Income

$                      353

$                      337

$                  1,009

$                      473

  Depreciation and Amortization

$                      556

$                      362

$                  1,092

$                      730

  Duke Energy Carolinas GWh sales

20,202

19,574

42,448

39,035

  Duke Energy Progress GWh sales

14,055

13,466

28,756

26,634

  Duke Energy Florida's GWh sales

9,853

9,938

17,869

18,349

  Duke Energy Ohio GWh sales

5,800

5,942

11,978

11,796

  Duke Energy Indiana GWh sales

7,937

8,292

16,442

16,761

  Net Proportional MW Capacity in Operation

49,560

27,145

COMMERCIAL POWER

  Operating Revenues

$                      557

$                      502

$                  1,009

$                  1,082

  Operating Expenses

508

460

1,041

990

  Gains on Sales of Other Assets, net

1

1

1

1

  Operating Income (Loss)

50

43

(31)

93

  Other Income and Expenses

-

17

11

25

  Interest Expense

17

22

32

41

  Income Before Income Taxes

33

38

(52)

77

  Income Tax Expense

(8)

10

(51)

18

  Segment Income

$                          41

$                         28

$                           (1)

$                         59

  Depreciation and Amortization

$                         62

$                         58

$                       125

$                        114

Actual Coal-fired Plant Production, GWh

4,185

3,299

8,734

7,367

Actual Gas-fired Plant Production, GWh

3,341

4,513

7,238

9,096

Actual Renewable Plant Production, GWh

1,415

786

2,820

1,784

Actual Plant Production, GWh

8,941

8,598

18,792

18,247

  Net Proportional MW Capacity in Operation

8,127

7,757

INTERNATIONAL ENERGY

  Operating Revenues

$                      406

$                      397

$                      798

$                      799

  Operating Expenses

270

257

533

502

  Operating Income (Loss)

136

140

265

297

  Other Income and Expenses

14

36

47

90

  Interest Expense

17

21

38

37

  Income Before Income Taxes

133

155

274

350

  Income Tax Expense

42

46

84

95

  Less: Income Attributable to Noncontrolling Interests

4

4

6

8

  Segment Income

$                         87

$                       105

$                       184

$                      247

  Depreciation and Amortization

$                         24

$                         25

$                         50

$                         49

  Sales, GWh

4,926

4,882

9,682

9,956

  Proportional MW Capacity in Operation

4,584

4,225

OTHER 

  Operating Revenues

$                         36

$                          16

$                          71

$                          31

  Operating Expenses(g)

156

14

246

30

  (Losses) Gains on Sales of Other Assets, net

(4)

-

(4)

(1)

  Operating Income (Loss)

(124)

2

(179)

-

  Other Income and Expenses

8

(6)

19

(1)

  Interest Expense

105

46

200

89

  (Loss) Income Before Income Taxes

(221)

(50)

(360)

(90)

  Income Tax (Benefit) Expense (h)

(81)

(25)

(141)

(49)

  Less: Income (Loss) Attributable to Noncontrolling Interests

(1)

-

(3)

-

  Net Expense

$                     (139)

$                       (25)

$                     (216)

$                        (41)

  Depreciation and Amortization

$                         36

$                         30

$                          71

$                          61

(a) Includes a pre-tax impairment charge of $295 million for the three and six months ended June 30, 2013, related to the Crystal River Unit 3 Nuclear Station.

(b) Includes pre-tax impairment charges of $87 million for the three and six months ended June 30, 2013, related nuclear development costs.

(c) Includes pre-tax impairment and other charges of $420 million for the six months ended June 30, 2012, related to the Edwardsport IGCC project.

(d) Includes a tax benefit of $115 million for the three and six months ended June 30, 2013, on the impairment related to the Crystal River Unit 3 Nuclear Station.

(e) Includes a tax benefit of $30 million for the three and six months ended June 30, 2013, on the impairment related to nuclear development costs.

(f) Includes a tax benefit of $162 million for the six months ended June 30, 2012, on the impairment and other charges related to the Edwardsport IGCC project.

(g) Includes costs to achieve the Progress Energy merger of $92 million recorded in Operating Expense for the three months ended December 31, 2012, and $162 million recorded      in Operating Expense for the six months ended June 30, 2013.

(h)  Includes a tax benefit related to costs to achieve of $31 million for the three months ended June 30, 2013, and $52 million for the six months ended June 30, 2013.

 

DUKE ENERGY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In millions, except per-share amounts)

Three Months Ended

Six Months Ended

June 30,

June 30,

2013

2012

2013

2012

Operating Revenues

Regulated electric

$         4,834

$         2,628

$         9,723

$         5,129

Nonregulated electric, natural gas, and other

951

868

1,775

1,826

Regulated natural gas

94

81

279

252

      Total operating revenues

5,879

3,577

11,777

7,207

Operating Expenses

Fuel used in electric generation and purchased power - regulated

1,678

849

3,381

1,626

Fuel used in electric generation and purchased power - nonregulated 

447

396

901

844

Cost of natural gas and coal sold

43

42

147

144

Operation, maintenance and other

1,504

862

2,925

1,608

Depreciation and amortization

678

475

1,338

954

Property and other taxes

323

171

666

355

Impairment charges

386

-

386

402

      Total operating expenses

5,059

2,795

9,744

5,933

Gains on Sales of Other Assets and Other, net

1

4

3

7

Operating Income

821

786

2,036

1,281

Other Income and Expenses

Equity in earnings of unconsolidated affiliates

22

40

58

85

Impairments on sales of unconsolidated affiliates

(6)

(1)

(6)

(6)

Other income and expenses, net

54

70

134

159

      Total other income and expenses

70

109

186

238

Interest Expense

381

232

748

456

Income From Continuing Operations Before Income Taxes

510

663

1,474

1,063

Income Tax Expense from Continuing Operations

165

214

495

317

Income From Continuing Operations

345

449

979

746

(Loss) Income From Discontinued Operations, net of tax

(3)

(1)

(3)

1

Net Income 

342

448

976

747

Less: Net Income Attributable to Noncontrolling Interests 

3

4

3

8

Net Income Attributable to Duke Energy Corporation

$            339

$            444

$            973

$            739

Earnings Per Share - Basic and Diluted

Income from continuing operations attributable to Duke Energy Corporation common shareholders

Basic 

$           0.48

$           0.99

$           1.37

$           1.65

Diluted

$           0.48

$           0.99

$           1.37

$           1.65

Loss from discontinued operations attributable to Duke Energy Corporation common shareholders

Basic 

$                 -

$                 -

$                 -

$                 -

Diluted

$                 -

$                 -

$                 -

$                 -

Net Income attributable to Duke Energy Corporation common shareholders

Basic 

$           0.48

$           0.99

$           1.37

$           1.65

Diluted

$           0.48

$           0.99

$           1.37

$           1.65

Dividends declared per share

$         1.545

$         1.515

$           2.31

$           2.27

Weighted-average shares outstanding

Basic

706

446

705

446

Diluted

706

446

706

446

 

DUKE ENERGY CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In millions)

June 30,

December 31,

2013

2012

ASSETS

Current Assets

Cash and cash equivalents

$               1,571

$               1,424

Short-term investments

280

333

Receivables (net of allowance for doubtful accounts of 

$32 at June 30, 2013 and $34 at December 31, 2012)

1,593

1,516

Restricted receivables of variable interest entities (net of allowance for 

doubtful accounts of $42 at June 30, 2013 and $44 at December 31, 2012)

1,235

1,201

Inventory

3,130

3,223

Other

2,066

2,425

Total current assets

9,875

10,122

Investments and Other Assets

Investments in equity method unconsolidated affiliates

508

483

Nuclear decommissioning trust funds

4,567

4,242

Goodwill

16,345

16,365

Intangibles, net

350

372

Notes receivable

68

71

Restricted other assets of variable interest entities

57

62

Other

2,412

2,399

Total investments and other assets

24,307

23,994

Property, Plant and Equipment

Cost

99,661

98,833

Cost, variable interest entities

1,666

1,558

Accumulated depreciation and amortization

(32,511)

(31,969)

Generation facilities to be retired, net

61

136

Net property, plant and equipment

68,877

68,558

Regulatory Assets and Deferred Debits

Regulatory assets 

10,864

11,004

Other

177

178

Total regulatory assets and deferred debits

11,041

11,182

Total Assets

$           114,100

$           113,856

LIABILITIES AND EQUITY

Current Liabilities

Accounts payable

$               1,936

$               2,444

Notes payable and commercial paper

1,501

745

Non-recourse notes payable of variable interest entities

325

312

Taxes accrued

553

459

Interest accrued

451

448

Current maturities of long-term debt

2,223

3,110

Other

3,026

2,511

Total current liabilities

10,015

10,029

Long-term Debt

36,100

35,499

Non-recourse Long-term Debt of Variable Interest Entities

1,259

852

Deferred Credits and Other Liabilities

Deferred income taxes

10,829

10,490

Investment tax credits

450

458

Accrued pension and other post-retirement benefit costs

2,373

2,520

Asset retirement obligations

5,284

5,169

Regulatory liabilities

5,483

5,584

Other

2,106

2,221

Total deferred credits and other liabilities

26,525

26,442

Commitments and Contingencies

Preferred Stock of Subsidiaries

-

93

Equity

Common stock, $0.001 par value, 2 billion shares authorized; 706 million 

and 704 million shares outstanding at June 30, 2013 and 

December 31, 2012, respectively

1

1

Additional paid-in capital

39,284

39,279

Retained earnings

1,223

1,889

Accumulated other comprehensive loss

(376)

(306)

Total Duke Energy Corporation shareholders' equity

40,132

40,863

Noncontrolling interests

69

78

Total equity

40,201

40,941

Total Liabilities and Equity

$           114,100

$           113,856

 

DUKE ENERGY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In millions)

Six Months Ended June 30,

2013

2012

CASH FLOWS FROM OPERATING ACTIVITIES

Net income 

$                976

$                747

Adjustments to reconcile net income to net cash provided by

operating activities:

1,867

1,255

Net cash provided by operating activities

2,843

2,002

CASH FLOWS FROM INVESTING ACTIVITIES

Net cash used in investing activities

(2,562)

(2,391)

CASH FLOWS FROM FINANCING ACTIVITIES

Net cash used in financing activities

(134)

(195)

Net increase (decrease) in cash and cash equivalents

147

(584)

Cash and cash equivalents at beginning of period

1,424

2,110

Cash and cash equivalents at end of period

$             1,571

$             1,526

 

Duke Energy Carolinas

Quarterly Highlights

Supplemental Franchised Electric Information

June 2013

Three Months Ended

Six Months Ended

June 30

June 30

%

%

2013

2012

Inc.(Dec.)

2013

2012

Inc.(Dec.)

GWH Sales 

Residential

5,818

5,531

5.2%

13,523

12,561

7.7%

General Service

6,777

6,755

0.3%

13,303

13,146

1.2%

Industrial

5,329

5,391

(1.2%)

10,140

10,270

(1.3%)

Other Energy Sales

72

72

0.0%

146

144

1.4%

    Total Regular Sales Billed

17,996

17,749

1.4%

37,112

36,121

2.7%

Special Sales (1)

2,190

1,212

80.7%

5,310

2,473

114.7%

      Total Electric Sales

20,186

18,961

6.5%

42,422

38,594

9.9%

Unbilled Sales

16

613

(97.4%)

26

441

(94.1%)

  Total Consolidated Electric Sales - Duke Energy Carolinas

20,202

19,574

3.2%

42,448

39,035

8.7%

Average Number of Customers

Residential

2,064,385

2,051,319

0.6%

2,063,362

2,049,840

0.7%

General Service

338,779

336,781

0.6%

338,147

336,216

0.6%

Industrial

6,627

6,770

(2.1%)

6,639

6,801

(2.4%)

Other Energy Sales

14,412

14,307

0.7%

14,381

14,305

0.5%

  Total Regular Sales

2,424,203

2,409,177

0.6%

2,422,529

2,407,162

0.6%

Special Sales

24

24

0.0%

24

23

4.3%

Total Average Number of Customers - Duke Energy Carolinas

2,424,227

2,409,201

0.6%

2,422,553

2,407,185

0.6%

Heating and Cooling Degree Days

Actual

Heating Degree Days

250

161

55.3%

2,106

1,480

42.3%

Cooling Degree Days

437

526

(16.9%)

437

558

(21.7%)

Variance from Normal

Heating Degree Days

21.4%

(22.3%)

n/a

7.4%

(24.6%)

n/a

Cooling Degree Days

(15.2%)

5.4%

n/a

(16.3%)

10.6%

n/a

(1)  Second quarter 2013 and year-to-date 2013 include 168 GWH and 352 GWH, respectively, of sales associated with the FERC mitigation contracts, for which the financial results are excluded from the Franchised Electric & Gas segment earnings. 

 

Duke Energy Progress

Quarterly Highlights

Supplemental Franchised Electric Information

June 2013

Three Months Ended

Six Months Ended

June 30

June 30

%

%

2013

2012

Inc.(Dec.)

2013

2012

Inc.(Dec.)

GWH Sales 

Residential

3,812

3,544

7.6%

8,771

7,979

9.9%

General Service

3,675

3,703

(0.8%)

7,157

7,152

0.1%

Industrial

2,664

2,683

(0.7%)

5,108

5,112

(0.1%)

Other Energy Sales

30

31

(3.2%)

60

61

(1.6%)

    Total Regular Sales Billed

10,181

9,961

2.2%

21,096

20,304

3.9%

Special Sales (1)

3,922

3,307

18.6%

7,673

6,265

22.5%

      Total Electric Sales

14,103

13,268

6.3%

28,769

26,569

8.3%

Unbilled Sales

(48)

198

(124.4%)

(13)

65

(120.0%)

  Total Consolidated Electric Sales - Duke Energy Progress

14,055

13,466

4.4%

28,756

26,634

8.0%

Average Number of Customers

Residential

1,240,416

1,229,861

0.9%

1,238,992

1,228,690

0.8%

General Service

221,592

219,363

1.0%

220,900

218,814

1.0%

Industrial

4,375

4,434

(1.3%)

4,385

4,445

(1.3%)

Other Energy Sales

1,812

1,844

(1.7%)

1,812

1,858

(2.5%)

  Total Regular Sales

1,468,195

1,455,502

0.9%

1,466,089

1,453,807

0.8%

Special Sales

15

20

(25.0%)

15

20

(25.0%)

Total Average Number of Customers - Duke Energy Progress

1,468,210

1,455,522

0.9%

1,466,104

1,453,827

0.8%

Heating and Cooling Degree Days

Actual

Heating Degree Days

240

166

44.4%

2,004

1,384

44.8%

Cooling Degree Days

488

583

(16.3%)

495

642

(22.9%)

Variance from Normal

Heating Degree Days

21.5%

(21.0%)

n/a

6.5%

(27.7%)

n/a

Cooling Degree Days

(15.2%)

(0.7%)

n/a

(15.7%)

7.2%

n/a

(1)  Both second quarter 2013 and year-to-date 2013 include 303 GWH of sales associated with the FERC mitigation contracts, for which the financial results are excluded from the Franchised Electric & Gas segment earnings. 

 

Duke Energy Florida

Quarterly Highlights

Supplemental Franchised Electric Information

June 2013

Three Months Ended

Six Months Ended

June 30

June 30

%

%

2013

2012

Inc.(Dec.)

2013

2012

Inc.(Dec.)

GWH Sales 

Residential

4,491

4,525

(0.8%)

8,235

8,230

0.1%

General Service

3,694

3,768

(2.0%)

6,918

7,079

(2.3%)

Industrial

827

808

2.5%

1,582

1,565

1.1%

Other Energy Sales

6

6

0.0%

12

12

0.0%

    Total Regular Sales Billed

9,018

9,107

(1.0%)

16,747

16,886

(0.8%)

Special Sales

372

424

(12.3%)

658

770

(14.5%)

      Total Electric Sales

9,390

9,531

(1.5%)

17,405

17,656

(1.4%)

Unbilled Sales

463

407

13.8%

464

693

(33.0%)

  Total Consolidated Electric Sales - Duke Energy Florida

9,853

9,938

(0.9%)

17,869

18,349

(2.6%)

Average Number of Customers

Residential

1,480,411

1,463,383

1.2%

1,477,080

1,462,194

1.0%

General Service

189,173

187,031

1.1%

188,758

186,833

1.0%

Industrial

2,357

2,364

(0.3%)

2,359

2,380

(0.9%)

Other Energy Sales

1,567

1,549

1.2%

1,568

1,548

1.3%

  Total Regular Sales

1,673,508

1,654,327

1.2%

1,669,765

1,652,955

1.0%

Special Sales

15

15

0.0%

15

14

7.1%

Total Average Number of Customers - Duke Energy Florida

1,673,523

1,654,342

1.2%

1,669,780

1,652,969

1.0%

Heating and Cooling Degree Days

Actual

Heating Degree Days

9

9

0.0%

283

211

34.1%

Cooling Degree Days

967

973

(0.6%)

1,168

1,298

(10.0%)

Variance from Normal

Heating Degree Days

(61.9%)

(62.3%)

n/a

(5.4%)

(29.5%)

n/a

Cooling Degree Days

2.5%

3.1%

n/a

0.8%

12.0%

n/a

 

Duke Energy Ohio

Quarterly Highlights

Supplemental Franchised Electric Information

June 2013

Three Months Ended

Six Months Ended

June 30, 2013

June 30, 2013

%

%

2013

2012

Inc.(Dec.)

2013

2012

Inc.(Dec.)

GWH Sales 

Residential

1,837

1,792

2.5%

4,335

4,039

7.3%

General Service

2,283

2,291

(0.3%)

4,565

4,498

1.5%

Industrial

1,423

1,430

(0.5%)

2,819

2,828

(0.3%)

Other Energy Sales

28

28

0.0%

56

57

(1.8%)

    Total Regular Electric Sales Billed

5,571

5,541

0.5%

11,775

11,422

3.1%

Special Sales 

99

95

4.2%

219

147

49.0%

      Total Electric Sales Billed

5,670

5,636

0.6%

11,994

11,569

3.7%

Unbilled Sales

130

306

(57.5%)

(16)

227

(107.0%)

  Total Electric Sales - Duke Energy Ohio

5,800

5,942

(2.4%)

11,978

11,796

1.5%

Average Number of Customers

Residential

737,683

733,486

0.6%

737,483

734,801

0.4%

General Service

86,233

85,585

0.8%

86,145

85,624

0.6%

Industrial 

2,557

2,587

(1.2%)

2,559

2,592

(1.3%)

Other Energy

2,934

2,893

1.4%

2,930

2,886

1.5%

  Total Regular Sales

829,407

824,551

0.6%

829,117

825,903

0.4%

Special Sales

1

2

(50.0%)

1

2

(50.0%)

Total Average Number Electric Customers - Duke Energy Ohio

829,408

824,553

0.6%

829,118

825,905

0.4%

Heating and Cooling Degree Days

Actual

Heating Degree Days

237

174

36.2%

2,402

1,699

41.4%

Cooling Degree Days

346

438

(21.0%)

346

467

(25.9%)

Variance from Normal

Heating Degree Days

9.2%

(18.3%)

n/a

4.9%

(26.5%)

n/a

Cooling Degree Days

3.0%

31.9%

n/a

2.4%

39.8%

n/a

 

Duke Energy Ohio

Quarterly Highlights

Supplemental Franchised Gas Information

June 2013

Three Months Ended

Six Months Ended

June 30, 2013

June 30, 2013

%

%

2013

2012

Inc.(Dec.)

2013

2012

Inc.(Dec.)

MCF Sales 

Residential

6,575,647

3,826,030

71.9%

26,620,497

20,359,013

30.8%

General Service

4,151,037

2,782,916

49.2%

15,799,582

12,377,532

27.6%

Industrial 

1,281,485

970,699

32.0%

3,688,976

2,923,763

26.2%

Other Energy Sales

4,733,817

5,268,190

(10.1%)

10,888,315

11,399,541

(4.5%)

    Total Gas Sales Billed - Duke Energy Ohio

16,741,986

12,847,835

30.3%

56,997,370

47,059,849

21.1%

Unbilled Sales

(4,003,000)

(1,288,000)

(210.8%)

(4,915,000)

(3,910,000)

(25.7%)

  Total Gas Sales - Duke Energy Ohio

12,738,986

11,559,835

10.2%

52,082,370

43,149,849

20.7%

Average Number of Customers

Residential

470,301

468,717

0.3%

470,936

470,277

0.1%

General Service

43,300

43,343

(0.1%)

44,151

44,286

(0.3%)

Industrial

1,625

1,657

(1.9%)

1,657

1,686

(1.7%)

Other Energy

165

171

(3.5%)

166

171

(2.9%)

Total Average Number Gas Customers - Duke Energy Ohio

515,391

513,888

0.3%

516,910

516,420

0.1%

Heating and Cooling Degree Days

Actual

Heating Degree Days

237

174

36.2%

2,402

1,699

41.4%

Cooling Degree Days

346

438

(21.0%)

346

467

(25.9%)

Variance from Normal

Heating Degree Days

9.2%

(18.3%)

n/a

4.9%

(26.5%)

n/a

Cooling Degree Days

3.0%

31.9%

n/a

2.4%

39.8%

n/a

 

Duke Energy Indiana

Quarterly Highlights

Supplemental Franchised Electric Information

June 2013

Three Months Ended

Six Months Ended

June 30, 2013

June 30, 2013

%

%

2013

2012

Inc.(Dec.)

2013

2012

Inc.(Dec.)

GWH Sales 

Residential

1,899

1,804

5.3%

4,727

4,310

9.7%

General Service

2,002

2,034

(1.6%)

4,033

3,994

1.0%

Industrial

2,578

2,628

(1.9%)

5,097

5,184

(1.7%)

Other Energy Sales

13

13

0.0%

26

27

(3.7%)

    Total Regular Electric Sales Billed

6,492

6,479

0.2%

13,883

13,515

2.7%

Special Sales 

1,373

1,547

(11.2%)

2,626

3,016

(12.9%)

      Total Electric Sales Billed - Duke Energy Indiana

7,865

8,026

(2.0%)

16,509

16,531

(0.1%)

Unbilled Sales

72

266

(72.9%)

(67)

230

(129.1%)

  Total Electric Sales - Duke Energy Indiana

7,937

8,292

(4.3%)

16,442

16,761

(1.9%)

Average Number of Customers

Residential

686,314

682,328

0.6%

688,267

683,257

0.7%

General Service

100,228

100,105

0.1%

100,168

100,049

0.1%

Industrial 

2,719

2,722

(0.1%)

2,720

2,729

(0.3%)

Other Energy

1,468

1,432

2.5%

1,461

1,427

2.4%

  Total Regular Sales

790,729

786,587

0.5%

792,616

787,462

0.7%

Special Sales

6

12

(50.0%)

7

11

(36.4%)

Total Average Number Electric Customers - Duke Energy Indiana

790,735

786,599

0.5%

792,623

787,473

0.7%

Heating and Cooling Degree Days

Actual

Heating Degree Days

286

170

68.2%

2,713

1,792

51.4%

Cooling Degree Days

328

482

(32.0%)

328

520

(36.9%)

Variance from Normal

Heating Degree Days

17.7%

(29.2%)

n/a

9.3%

(28.6%)

n/a

Cooling Degree Days

(4.4%)

42.6%

n/a

(4.9%)

53.4%

n/a

 

DUKE ENERGY CORPORATION

ADJUSTED TO REPORTED EARNINGS RECONCILIATION

Three Months Ended June 30, 2013

(Dollars in millions, except per-share amounts)

Special Items 

Adjusted

Earnings

Costs to

Achieve,

Progress

Energy

Merger

Nuclear

Development

Charges

Litigation

Reserve

Crystal River

Unit 3

Impairment

Economic

Hedges (Mark-

to-Market) *

Discontinued

Operations

Total

Adjustments

Reported

Earnings

SEGMENT INCOME

U.S. Franchised Electric and Gas

$           590

$                    -

$               (57)

 D 

$                 -

$           (180)

 F 

$                 -

$                    -

$             (237)

$          353

Commercial Power

(3)

-

-

-

-

44

 B 

-

44

41

International Energy

87

-

-

-

-

-

-

-

87

    Total Reportable Segment Income

674

-

(57)

-

(180)

44

-

(193)

481

Other

(57)

(51)

 A 

-

(31)

 E 

-

-

-

(82)

(139)

    Total Reportable Segment Income and Other Net Expense

$           617

$               (51)

$               (57)

$              (31)

$           (180)

$                44

$                    -

$             (275)

342

    Discontinued Operations

-

-

-

-

-

-

(3)

 C 

(3)

(3)

Net Income (Loss) Attributable to Duke Energy Corporation

$           617

$               (51)

$               (57)

$              (31)

$           (180)

$                44

$                  (3)

$             (278)

$          339

EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, BASIC

$          0.87

$            (0.07)

$            (0.08)

$           (0.04)

$          (0.26)

$             0.06

$                    -

$            (0.39)

$         0.48

EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, DILUTED

$          0.87

$            (0.07)

$            (0.08)

$           (0.04)

$          (0.26)

$             0.06

$                    -

$            (0.39)

$         0.48

A - Net of $31 million tax benefit. $11 million recorded as an increase in Regulated electric (Operating Revenues), $92 million recorded within Operating Expenses and $1 million recorded in Interest Expense on the       Condensed Consolidated Statements of Operations.

B - Net of $25 million tax expense. $79 million gain recorded within Nonregulated electric, natural gas, and other (Operating Revenues) and $10 million loss recorded within Fuel used in electric generation 

      and purchased power-nonregulated (Operating Expenses) on the Condensed Consolidated Statements of Operations.

C - Recorded in Income (Loss) From Discontinued Operations, net of tax on the Condensed Consolidated Statements of Operations.

D - Net of $30 million tax benefit. Recorded in Impairment charges (Operating Expenses) on the Condensed Consolidated Statements of Operations.

E - Net of $19 million tax benefit. Recorded in Operations, maintenance and other (Operating Expenses) on the Condensed Consolidated Statements of Operations.

F - Net of $115 million tax benefit. Recorded in Impairment charges (Operating Expenses) on the Condensed Consolidated Statements of Operations.

Weighted Average Shares (reported and adjusted) - in millions

Basic

706

Diluted

706

* Represents the mark-to-market impact of derivative contracts, which is recognized in earnings immediately as such derivative contracts do not qualify for hedge or regulatory accounting, used in Duke Energy Corporation's hedging of a portion of the economic value of its generation assets in the Commercial Power segment. The economic value of the generation assets is subject to fluctuations in fair value due to market price volatility of the input and output commodities (e.g. coal, gas, power) and, as such, the economic hedging involves both purchases and sales of those input and output commodities related to the generation assets. Because the operations of the generation assets are accounted for under the accrual method, management believes that excluding the impact of mark-to-market changes of the economic hedge contracts from adjusted earnings until settlement better matches the financial impacts of the hedge contract with the portion of the economic value of the underlying hedged asset. Management believes that the presentation of adjusted diluted EPS Attributable to Duke Energy Corporation provides useful information to investors, as it provides them an additional relevant comparison of Duke Energy Corporation's performance across periods.

 

DUKE ENERGY CORPORATION

ADJUSTED TO REPORTED EARNINGS RECONCILIATION

Six Months Ended June 30, 2013

(Dollars in millions, except per-share amounts)

Special Items 

Adjusted

Earnings

Costs to

Achieve,

Progress

Energy

Merger

Nuclear

Development

Charges

Litigation

Reserve

Crystal River

3 Unit

Impairment

Economic

Hedges (Mark-

to-Market) *

Discontinued

Operations

Total

Adjustments

Reported

Earnings

SEGMENT INCOME

U.S. Franchised Electric and Gas

$           1,246

$                     -

$                (57)

 D 

$                    -

$           (180)

 F 

$                    -

$                     -

$             (237)

$            1,009

Commercial Power

3

-

-

-

-

(4)

 B 

-

(4)

(1)

International Energy

184

-

-

-

-

-

-

-

184

    Total Reportable Segment Income

1,433

-

(57)

-

(180)

(4)

-

(241)

1,192

Other

(100)

(85)

 A 

-

(31)

 E 

-

-

-

(116)

(216)

    Total Reportable Segment Income and Other Net Expense

1,333

(85)

(57)

(31)

(180)

(4)

-

(357)

976

    Discontinued Operations

-

-

-

-

-

-

(3)

 C 

(3)

(3)

Net Income (Loss) Attributable to Duke Energy Corporation

$           1,333

$                (85)

$                (57)

$                (31)

$           (180)

$                  (4)

$                   (3)

$             (360)

$               973

EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, BASIC

$             1.89

$             (0.13)

$             (0.08)

$            (0.04)

$          (0.26)

$            (0.01)

$                     -

$            (0.52)

$              1.37

EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, DILUTED

$             1.89

$             (0.13)

$             (0.08)

$            (0.04)

$          (0.26)

$            (0.01)

$                     -

$            (0.52)

$              1.37

A - Net of $52 million tax benefit. $26 million recorded as an increase in Operating Revenues, $162 million recorded within Operating Expenses and $1 million recorded within Interest expense on the Condensed      Consolidated Statements of Operations.

B - Net of $2 million tax benefit. $11 million gain recorded within Non-regulated electric, natural gas, and other (Operating Revenues) and $17 million loss recorded within Fuel used in electric generation and purchased

       power-non-regulated (Operating Expenses) on the Condensed Consolidated Statements of Operations.

C - Recorded in Income (Loss) From Discontinued Operations, net of tax on the Condensed Consolidated Statements of Operations.

D - Net of $30 million tax benefit. Recorded in Impairment charges (Operating Expenses) on the Condensed Consolidated Statements of Operations.

E - Net of $19 million tax benefit. Recorded in Operations, maintenance and other (Operating Expenses) on the Condensed Consolidated Statements of Operations.

F - Net of $115 million tax benefit. Recorded in Impairment charges (Operating Expenses) on the Condensed Consolidated Statements of Operations.

Weighted Average Shares (reported and adjusted) - in millions

Basic

705

Diluted

706

* Represents the mark-to-market impact of derivative contracts, which is recognized in earnings immediately as such derivative contracts do not qualify for hedge or regulatory accounting, used in Duke Energy Corporation's hedging of a portion of the economic value of its generation assets in the Commercial Power segment. The economic value of the generation assets is subject to fluctuations in fair value due to market price volatility of the input and output commodities (e.g. coal, gas, power) and, as such, the economic hedging involves both purchases and sales of those input and output commodities related to the generation assets. Because the operations of the generation assets are accounted for under the accrual method, management believes that excluding the impact of mark-to-market changes of the economic hedge contracts from adjusted earnings until settlement better matches the financial impacts of the hedge contract with the portion of the economic value of the underlying hedged asset. Management believes that the presentation of adjusted diluted EPS Attributable to Duke Energy Corporation provides useful information to investors, as it provides them an additional relevant comparison of Duke Energy Corporation's performance across periods.

 

DUKE ENERGY CORPORATION

ADJUSTED TO REPORTED EARNINGS RECONCILIATION

Three Months Ended June 30, 2012

(Dollars in millions, except per-share amounts)

Special Items

(Note 1)

Adjusted

Earnings

Costs to

Achieve,

Progress

Merger

Economic

Hedges (Mark-

to-Market) *

Discontinued

Operations

Total

Adjustments

Reported

Earnings

SEGMENT INCOME

U.S. Franchised Electric and Gas

$           337

$                    -

$                 -

$                    -

$                    -

$          337

Commercial Power

32

-

(4)

 B 

-

(4)

28

International Energy

105

-

-

-

-

105

    Total Reportable Segment Income

474

-

(4)

-

(4)

470

Other

(18)

(7)

 A 

-

-

(7)

(25)

    Total Reportable Segment Income and Other Net Expense

$           456

$                 (7)

$                 (4)

$                    -

$               (11)

445

    Discontinued Operations

-

-

-

(1)

 C 

(1)

(1)

Net Income (Loss) Attributable to Duke Energy Corporation

$           456

$                 (7)

$                 (4)

$                  (1)

$               (12)

$          444

EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, BASIC

$          1.02

$            (0.02)

$           (0.01)

$                    -

$            (0.03)

$         0.99

EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, DILUTED

$          1.02

$            (0.02)

$           (0.01)

$                    -

$            (0.03)

$         0.99

Note 1 - Amounts for special items are presented net of any related noncontrolling interest.

A - Net of insignificant tax benefit. Recorded in Operation, maintenance and other (Operating Expenses) on the Condensed Consolidated Statements of Operations. 

B - Net of $2 million tax benefit. Recorded within Non-regulated electric, natural gas, and other (Operating Revenues) on the Condensed Consolidated Statements of Operations.

C - Recorded in Income (Loss) From Discontinued Operations, net of tax on the Condensed Consolidated Statements of Operations.

Weighted Average Shares (reported and adjusted) - in millions

Basic

446

Diluted

446

* Represents the mark-to-market impact of derivative contracts, which is recognized in earnings immediately as such derivative contracts do not qualify for hedge or regulatory accounting, used in Duke Energy Corporation's hedging of a portion of the economic value of its generation assets in the Commercial Power segment. The economic value of the generation assets is subject to fluctuations in fair value due to market price volatility of the input and output commodities (e.g. coal, gas, power) and, as such, the economic hedging involves both purchases and sales of those input and output commodities related to the generation assets. Because the operations of the generation assets are accounted for under the accrual method, management believes that excluding the impact of mark-to-market changes of the economic hedge contracts from adjusted earnings until settlement better matches the financial impacts of the hedge contract with the portion of the economic value of the underlying hedged asset. Management believes that the presentation of adjusted diluted EPS Attributable to Duke Energy Corporation provides useful information to investors, as it provides them an additional relevant comparison of Duke Energy Corporation's performance across periods.

 

DUKE ENERGY CORPORATION

ADJUSTED TO REPORTED EARNINGS RECONCILIATION

Six Months Ended June 30, 2012

(Dollars in millions, except per-share amounts)

Special Items

Adjusted

Earnings

Costs to

Achieve,

Progress

Energy

Merger

Voluntary

Opportunity

Plan Deferral

Edwardsport

Impairment

Economic

Hedges (Mark-

to-Market) *

Discontinued

Operations

Total

Adjustments

Reported

Earnings

SEGMENT INCOME 

U.S. Franchised Electric and Gas

$           681

$                -

$                 60

 C 

$             (268)

 E 

$                    -

$                     -

$              (208)

$          473

Commercial Power

62

-

-

-

(3)

 B 

-

(3)

59

International Energy

247

-

-

-

-

-

-

247

    Total Reportable Segment Income

990

-

60

(268)

(3)

-

(211)

779

Other

(28)

(13)

 A 

-

-

-

-

(13)

(41)

    Total Reportable Segment Income and Other Net Expense

962

(13)

60

(268)

(3)

-

(224)

738

    Discontinued Operations

-

-

-

-

-

1

 D 

1

1

Net Income (Loss) Attributable to Duke Energy Corporation

$           962

$           (13)

$                 60

$             (268)

$                 (3)

$                    1

$              (223)

$          739

EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, BASIC

$          2.16

$        (0.03)

$             0.13

$            (0.60)

$            (0.01)

$                   -

$             (0.51)

$         1.65

EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, DILUTED

$          2.16

$        (0.03)

$             0.13

$            (0.60)

$            (0.01)

$                   -

$             (0.51)

$         1.65

A - Net of $2 million tax benefit. $14 million recorded in Operating Expenses and $1 million recorded in Interest Expense on the Condensed Consolidated Statements of Operations. 

B - Net $1 million tax expense. $3 million loss recorded within Nonregulated electric, natural gas, and other (Operating Revenues) and $1 million loss recorded within Fuel used in electric generation and purchased power-nonregulated (Operating Expenses) on the Condensed Consolidated Statements of Operations.

C - Net of $39 million tax expense. $101 million revenue recorded in Operations, maintenance and other and $2 million expense recorded in Depreciation and Amortization (all Operating Expenses) on the Condensed Consolidated Statements of Operations.

D - Recorded in Income (Loss) From Discontinued Operations, net of tax on the Condensed Consolidated Statements of Operations.

E - Net of $152 million tax benefit. $400 million recorded in Goodwill and other impairment charges and $20 million recorded within Operations, maintenance and other (all Operating Expenses) on the Condensed Consolidated Statements of Operations.

Weighted Average Shares (reported and adjusted) - in millions

Basic

446

Diluted

446

* Represents the mark-to-market impact of derivative contracts, which is recognized in earnings immediately as such derivative contracts do not qualify for hedge or regulatory accounting, used in Duke Energy Corporation's hedging of a portion of the economic value of its generation assets in the Commercial Power segment. The economic value of the generation assets is subject to fluctuations in fair value due to market price volatility of the input and output commodities (e.g. coal, gas, power) and, as such, the economic hedging involves both purchases and sales of those input and output commodities related to the generation assets. Because the operations of the generation assets are accounted for under the accrual method, management believes that excluding the impact of mark-to-market changes of the economic hedge contracts from adjusted earnings until settlement better matches the financial impacts of the hedge contract with the portion of the economic value of the underlying hedged asset. Management believes that the presentation of adjusted diluted EPS Attributable to Duke Energy Corporation provides useful information to investors, as it provides them an additional relevant comparison of Duke Energy Corporation's performance across periods.

 

 

SOURCE Duke Energy

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