Duke Energy posts strong second quarter 2014 results; increases outlook for 2014 -- Second quarter 2014 adjusted diluted earnings per share (EPS) was $1.11, compared to 87 cents for the second quarter 2013

-- Reported diluted EPS for the second quarter 2014 of 86 cents, compared to reported diluted EPS of 48 cents for the second quarter 2013

-- Company increases its 2014 adjusted earnings guidance range from $4.45 to $4.60 per share to $4.50 to $4.65 per share

CHARLOTTE, N.C., Aug. 7, 2014 /PRNewswire/ -- Duke Energy today announced second quarter 2014 adjusted diluted EPS of $1.11, compared to 87 cents for second quarter 2013, and reported diluted EPS of 86 cents, compared to 48 cents for the same period last year.

The company saw strong performance from all of its business units in the quarter, led by Regulated Utilities, which continued to benefit from favorable weather and a lower effective tax rate, and International Energy, which recognized a tax benefit resulting from the reorganization of the company's operations in Chile.

Based upon results through the first half of the year, the company is increasing its 2014 adjusted earnings guidance range from $4.45 to $4.60 per share to $4.50 to $4.65 per share.

"Our strong second quarter performance and continued focus on operational excellence leaves us well-positioned to meet our financial objectives in 2014 and beyond. We are committed to maintaining affordable customer rates and to supporting the strength of our local communities, as evidenced by our recent agreement with the North Carolina Eastern Municipal Power Agency," said Lynn Good, president and CEO.

"We are executing our strategy to position the business for long-term sustainable growth, benefitting our customers and shareholders," she added.

Business Unit Results

In addition to the summary business unit discussion below, a comprehensive table of quarterly and year-to-date earnings per share drivers compared to the prior year are provided on pages 10 and 11.

The discussion below of second-quarter results includes adjusted segment income, which is a non-GAAP financial measure. The tables on pages 24 through 27 present a reconciliation of reported results to adjusted results.

Regulated Utilities

Regulated Utilities recognized second quarter 2014 adjusted segment income of $689 million, compared to $590 million in the second quarter 2013, an increase of $0.13 per share.

Increased quarterly results at Regulated Utilities were primarily driven by:

  • Higher revenues from increased pricing and riders (+$0.07 per share) primarily related to the implementation of revised customer rates
  • Favorable weather (+$0.07 per share) driven by warmer than normal temperatures across Duke Energy's service territories
  • Lower effective tax rate (+$0.05 per share) primarily due to a state tax settlement that resulted in a favorable adjustment to deferred taxes
  • Lower operating and maintenance expenses (+$0.03 per share) primarily driven by a prior-year donation associated with the 2013 Duke Energy Progress rate case settlement as well as the benefit of nuclear outage cost levelization
  • Increased wholesale net margins (+$0.02 per share) primarily resulting from growth in contracted amounts

These favorable drivers were partially offset by:

  • Higher depreciation and amortization expense (-$0.07 per share) primarily resulting from additional plant in service and a decrease in cost of removal amortization
  • Higher interest expense (-$0.03 per share) primarily due to lower post-in-service debt returns on projects now reflected in customer rates
  • Lower AFUDC equity (-$0.01 per share) primarily due to the completion of certain major capital projects

On a year-to-date basis, Regulated Utilities recognized adjusted segment income of $1,426 million, compared to $1,246 million in the comparable year-to-date period of 2013, an increase of $0.26 per share.

Increased year-to-date results at Regulated Utilities were primarily driven by:

  • Higher revenues from increased pricing and riders (+$0.20 per share) primarily related to the implementation of revised customer rates
  • Favorable weather (+$0.15 per share) across Duke Energy's service territories
  • Higher weather-normal retail volumes (+$0.06 per share) of 1.5 percent compared to 2013 primarily driven by strong results in the first quarter
  • Lower effective tax rate (+$0.05 per share) primarily due to a state tax settlement that resulted in a favorable adjustment to deferred taxes
  • Increased wholesale net margins (+$0.05 per share) primarily resulting from growth in contracted amounts and favorable weather

These favorable drivers were partially offset by:

  • Higher depreciation and amortization expense (-$0.14 per share) due to additional plant in service and the prior-year impact of cost of removal amortization primarily in Florida
  • Higher interest expense (-$0.06 per share) due to lower post-in-service debt returns on projects now reflected in customer rates
  • Lower AFUDC equity (-$0.03 per share) primarily due to the completion of certain major capital projects

International Energy

International Energy recognized second quarter 2014 adjusted segment income of $146 million, compared to $87 million in the second quarter 2013, an increase of $0.09 per share.

International Energy's improved quarterly earnings were driven by:

  • Favorable results in Latin America (+$0.08 per share) primarily due to a tax benefit resulting from the reorganization of the company's operations in Chile
  • Higher results at National Methanol Company (+$0.02 per share) due to a prior-year extended planned maintenance outage

These favorable drivers were partially offset by unfavorable foreign currency exchange rates (-$0.01 per share).

On a year-to-date basis, International Energy recognized adjusted segment income of $276 million, compared to $184 million in the comparable year-to-date period of 2013, an increase of $0.13 per share.

International Energy's improved year-to-date earnings were driven by:

  • Stronger results in Latin America (+$0.13 per share), primarily due to a tax benefit resulting from the reorganization of the company's operations in Chile and higher average volumes and pricing in Brazil
  • Higher results at National Methanol Company (+$0.02 per share) due to a prior-year extended planned maintenance outage

These drivers were partially offset by unfavorable foreign currency exchange rates (-$0.03 per share).

Commercial Power

Commercial Power recognized second quarter 2014 adjusted segment income of $16 million, compared to a segment loss of $3 million in the second quarter 2013, an increase of $0.02 per share.

Commercial Power's improved quarterly earnings were primarily driven by:

  • Higher results from the Midwest coal and gas generation fleets (+$0.02 per share) primarily due to higher PJM capacity prices
  • Increased results at the renewables business (+$0.01 per share) due to higher production of the wind and solar portfolio

On a year-to-date basis, Commercial Power recognized adjusted segment income of $26 million, compared to $3 million in the comparable year-to-date period of 2013, an increase of $0.03 per share.

Commercial Power's improved year-to-date earnings were primarily driven by:

  • Increased results from the renewables business (+$0.03 per share) due to higher production of the wind and solar portfolio and lower operating costs
  • Higher results from the Midwest coal and gas generation fleets (+$0.03 per share) primarily due to higher PJM capacity prices

These results were partially offset by lower earnings from the company's competitive retail business, Duke Energy Retail (-$0.02 per share).

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 income tax levelization adjustments.

Other recognized a second quarter 2014 adjusted net expense of $65 million, compared to $57 million in the second quarter 2013. On a year-to-date basis, Other recognized adjusted net expense of $113 million, compared to $100 million in the comparable period of 2013.

Earnings Conference Call for Analysts

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 other business updates.

The conference call will be hosted by Lynn Good, president and chief executive officer, and Steve Young, executive vice president and chief financial officer. 

The call can be accessed via the investors' section (http://www.duke-energy.com/investors/) of Duke Energy's website or by dialing 877-718-5108 in the United States or 719-325-4765 outside the United States. The confirmation code is 6615300. 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, 2014, by calling 888-203-1112 in the United States or 719-457-0820 outside the United States and using the code 6615300. A replay and transcript also will be available by accessing the investors' section of the company's website.

Special Items and Non-GAAP Reconciliation

Special items affecting Duke Energy's adjusted diluted EPS for second quarter 2014 and second quarter 2013 include:

(In millions, except per-share amounts)

Pre-Tax
Amount

Tax
Effect

2Q2014
EPS
Impact

2Q2013
EPS
Impact

Second Quarter 2014





-    Economic hedges (mark-to-market)

$(213)

$77

$(0.19)


-    Costs to achieve, Progress Energy merger

$(61)

$23

$(0.06)


-    Discontinued operations

$(13)

$10

--


Second Quarter 2013





-    Crystal River Unit 3 impairment

$(295)

$115


$(0.26)

-    Nuclear development charges

$(87)

$30


$(0.08)

-    Costs to achieve, Progress Energy merger

$(82)

$31


$(0.07)

-    Litigation reserve

$(50)

$19


$(0.04)

-    Economic hedges (mark-to-market)

$73

$(29)


$0.06

-    Discontinued operations

$(5)

$2


--

Total diluted EPS impact



$(0.25)

$(0.39)

Reconciliation of reported to adjusted diluted EPS for the quarters:


2Q2014

EPS

2Q2013

EPS

Diluted EPS, as reported

$0.86

$0.48

Adjustments to reported EPS:



-    Diluted EPS impact of special items, mark-to-market in Commercial
     Power, and discontinued operations (net of tax)

$0.25

$0.39

Diluted EPS, adjusted

$1.11

$0.87

Non-GAAP financial measures

Management evaluates financial performance in part based on the non-GAAP financial measures, adjusted earnings and adjusted diluted earnings per share (EPS). These items are measured as income from continuing operations after deducting income attributable to noncontrolling interests, adjusted for the dollar and per share impact of special items and mark-to-market impacts of economic hedges in the Commercial Power segment. 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 impact of derivative contracts, which are used in Duke Energy's hedging of a portion of the economic value of its generation assets in the Commercial Power segment and also relate to existing derivative positions that may have tenors beyond the planned disposal date of the nonregulated Midwest generation business. The mark-to-market impact of derivative contracts is recognized in GAAP earnings immediately as such derivative contracts do not qualify for hedge accounting or regulatory treatment. The economic value of generation assets is subject to fluctuations in fair value due to market price volatility of input and output commodities (e.g. coal, electricity, natural gas). Economic hedging involves both purchases and sales of those input and output commodities related to generation assets. Operations of the generation assets are accounted for under the accrual method. Management believes excluding impacts of mark-to-market changes of the derivative contracts from adjusted earnings until settlement better matches the financial impacts of the derivative contract with the portion of economic value of the underlying hedged asset. However, due to the divestiture of the nonregulated Midwest generation business as mentioned above, certain derivative positions have tenors beyond the planned disposal date of these assets. As such, management expects to exclude any settlement of these derivative positions from adjusted diluted EPS as these realized gains and losses more closely relate to the loss on disposal of these assets. Management believes the presentation of adjusted earnings and adjusted diluted EPS provides useful information to investors, as it provides them an additional relevant comparison of Duke Energy's performance across periods. Management uses these non-GAAP financial measures for planning and forecasting and for reporting results to the Board of Directors, employees, shareholders, analysts and investors concerning Duke Energy's financial performance. Adjusted diluted EPS is also used as a basis for employee incentive bonuses. The most directly comparable GAAP measures for adjusted earnings and adjusted diluted EPS are Net Income Attributable to Duke Energy Corporation and Diluted EPS attributable to Duke Energy Corporation common shareholders, which include the dollar and per share impact of special items, mark-to-market impacts of economic hedges in the Commercial Power segment and discontinued operations. Management evaluates segment performance based on segment income. Segment income is defined as income from continuing operations net of income attributable to noncontrolling interests. Segment income, as discussed below, includes intercompany revenues and expenses that are eliminated in the Condensed Consolidated Financial Statements. Management also uses adjusted segment income as a measure of historical and anticipated future segment performance. Adjusted segment income is a non-GAAP financial measure, as it is based upon segment income adjusted for special items and mark-to-market impacts of economic hedges in the Commercial Power segment. Management believes the presentation of adjusted segment income provides useful information to investors, as it provides them with an additional relevant comparison of a segment's performance across periods. The most directly comparable GAAP measure for adjusted segment income is segment income, which represents segment income from continuing operations, including any special items and mark-to-market impacts of economic hedges in the Commercial Power segment.

Due to the forward-looking nature of any forecasted adjusted earnings guidance, information to reconcile this non-GAAP financial measure to the most directly comparable GAAP financial measure is not available at this time, as management is unable to project all special items or mark-to-market adjustments for future periods. The earnings guidance range assumptions for 2014 include a full-year of earnings contributions from the nonregulated Midwest generation business, which management has begun a process to exit. Irrespective of whether this business is reclassified as discontinued operations for accounting purposes, management expects to continue including any nonregulated Midwest generation business earnings in adjusted earnings, adjusted diluted EPS, and adjusted segment income. Management believes it is unlikely a sale transaction will close in 2014.

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 all 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 $115 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 document 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," "outlook," "guidance," 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 extent and timing of the costs and liabilities relating to the Dan River ash basin release and future regulatory changes related to the management of coal ash; 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 decommissioning Crystal River Unit 3 could prove to be more extensive than is currently identified and all costs may not be fully recoverable through the regulatory process; the risk that the credit ratings of the combined company or its subsidiaries may be different from what the companies expect; 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 effort 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, data security breaches 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 prices, 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 and fixed income 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. 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.

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

Analysts: Bill Currens
Office: 704.382.1603

 

 


DUKE ENERGY CORPORATION

EARNINGS VARIANCES

June 2014 QTD vs. Prior Year


















($ per share)


Regulated
Utilities


International
Energy


Commercial
Power


Other


Consolidated


















2013 QTD Reported Earnings Per Share, Diluted


$

0.50


$

0.12


$

0.06


$

(0.20)


$

0.48

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 Adjusted Earnings Per Share, Diluted


$

0.84


$

0.12


$

-


$

(0.09)


$

0.87


















Weather



0.07



-



-



-



0.07


















Pricing and Riders (a)



0.07



-



-



-



0.07


















Operation and Maintenance, net of recoverables (b)



0.03



-



-



-



0.03


















Latin America, including Foreign Exchange Rates (c)



-



0.07



-



-



0.07


















National Methanol Company



-



0.02



-



-



0.02


















Midwest Generation (d)



-



-



0.02



-



0.02


















Duke Energy Renewables (e)



-



-



0.01



-



0.01


















Interest Expense (f)



(0.03)



-



(0.01)



0.01



(0.03)


















Change in effective income tax rate



0.05



-



(0.01)



-



0.04


















Other (g)



(0.06)



-



0.01



(0.01)



(0.06)











-







2014 QTD Adjusted Earnings Per Share, Diluted


$

0.97


$

0.21


$

0.02


$

(0.09)


$

1.11

Costs to Achieve, Progress Merger



-



-



-



(0.06)



(0.06)

Economic Hedges (Mark-to-Market)



-



-



(0.19)



-



(0.19)

2014 QTD Reported Earnings Per Share, Diluted


$

0.97


$

0.21


$

(0.17)


$

(0.15)


$

0.86


















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)

Primarily due to the September 2013 implementation of revised base rates for Duke Energy Carolinas (+$0.06), the June 2013 implementation of revised base rates for Duke Energy Progress (+$0.02), and the May 2013 implementation of revised electric distribution rates for Duke Energy Ohio (+$0.01).


















(b)

Primarily driven by lower donations and the impact of nuclear outage cost levelization.


















(c) 

Primarily driven by favorable results in Latin America (+$0.08) due to a tax benefit related to the reorganization of the company's operations in Chile, partially offset by unfavorable foreign currency exchange rates (-$0.01).


















(d)

Primarily due to lower depreciation and amortization due to ceasing depreciation on assets held for sale in the second quarter of 2014 (+$0.03) and higher PJM capacity revenues (+$0.02), partially offset by lower coal generation margins (-$0.01) and the impairment of ongoing capital maintenance investments that are not expected to change the estimated fair value of the generation business (-$0.02).


















(e)

Primarily due to higher production of the wind and solar portfolio.


















(f)

Amount for Regulated Utilities is primarily due to the discontinuation of booking a post in-service debt return on projects that are now reflected in customer rates.


















(g)

Amount for Regulated Utilities includes an increase in depreciation and amortization expense (-$0.07) due to higher depreciable base and lower adjustments to the cost of removal reserve, and lower AFUDC-equity (-$0.01), partially offset by higher wholesale net margins, including new contracts (+$0.02).

 

 


DUKE ENERGY CORPORATION

EARNINGS VARIANCES

June 2014 YTD vs. Prior Year


















($ per share)


Regulated
Utilities


International
Energy


Commercial
Power


Other


Consolidated


















2013 YTD Reported Earnings Per Share, Diluted


$

1.42


$

0.26


$

(0.01)


$

(0.30)


$

1.37

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 Adjusted Earnings Per Share, Diluted


$

1.76


$

0.26


$

-


$

(0.13)


$

1.89


















Weather



0.15



-



-



-



0.15


















Pricing and Riders (a)



0.20



-



-



-



0.20


















Volumes



0.06



-



-



-



0.06


















Operation and Maintenance, net of recoverables (b)



(0.01)



-



-



-



(0.01)


















Latin America, including Foreign Exchange Rates (c)



-



0.10



-



-



0.10


















National Methanol Company



-



0.02



-



-



0.02


















Midwest Generation (d)



-



-



0.03



-



0.03


















Duke Energy Retail 



-



-



(0.02)



-



(0.02)


















Duke Energy Renewables (e)



-



-



0.03



-



0.03


















Interest Expense (f)



(0.06)



-



(0.01)



(0.01)



(0.08)


















Change in effective income tax rate



0.05



-



(0.01)



0.01



0.05


















Other (g)



(0.13)



0.01



0.01



(0.03)



(0.14)


















2014 YTD Adjusted Earnings Per Share, Diluted


$

2.02


$

0.39


$

0.03


$

(0.16)


$

2.28

Midwest Generation Impairment



-



-



(1.23)



-



(1.23)

Costs to Achieve, Progress Merger



-



-



-



(0.10)



(0.10)

Economic Hedges (Mark-to-Market)



-



-



(0.22)



-



(0.22)

Discontinued Operations















(0.01)

2014 YTD Reported Earnings Per Share, Diluted


$

2.02


$

0.39


$

(1.42)


$

(0.26)


$

0.72



















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)

Primarily due to the September 2013 implementation of revised base rates for Duke Energy Carolinas (+$0.12), the June 2013 implementation of revised base rates for Duke Energy Progress (+$0.06), and the May 2013 implementation of revised electric distribution rates for Duke Energy Ohio (+$0.02).


















(b)

Primarily driven by storm costs in the Carolinas, the 2013 deferral of Crystal River Unit 3 costs, and clean up costs related to the Dan River coal ash spill. These drivers are partially offset by the impact of nuclear outage cost levelization and lower nuclear generation operating expenses.


















(c)

Primarily driven by a tax benefit related to the reorganization of the company's operations in Chile (+$0.07) and higher pricing and volumes in Brazil (+$0.04), partially offset by unfavorable foreign exchange rates (-$0.03).


















(d) 

Primarily due to lower depreciation and amortization due to ceasing depreciation on assets held for sale in the second quarter of 2014 (+$0.03), higher PJM capacity revenues (+$0.02), and higher gas generation margins (+$0.02), partially offset by lower coal generation margins (-$0.03) and the impairment of ongoing capital maintenance investments that are not expected to change the estimated fair value of the generation business (-$0.02).


















(e)

Primarily due to higher production of the wind and solar portfolio and lower operating costs. 


















(f)

Amount for Regulated Utilities is primarily due to the discontinuation of booking a post in-service debt return on projects that are now reflected in customer rates. 


















(g)

Amount for Regulated Utilities includes an increase in depreciation and amortization expense (-$0.14) due to higher depreciable base and the 2013 reduction in the cost of removal component of amortization expense for Duke Energy Florida, lower AFUDC-equity (-$0.03), and higher non-income taxes (-$0.01), partially offset by higher wholesale net margins (+$0.05).

 

 


June 2014

QUARTERLY HIGHLIGHTS

(Unaudited)










Three Months Ended


Six Months Ended


June 30,


June 30,









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

2014


2013


2014


2013

COMMON STOCK DATA








Income from continuing operations attributable to Duke Energy Corporation common shareholders








    Basic

$                0.86


$                0.48


$                0.73


$                1.37

    Diluted

$                0.86


$                0.48


$                0.73


$                1.37

(Loss) Income from discontinued operations attributable to Duke Energy Corporation common shareholders








    Basic

$                      -


$                      -


$               (0.01)


$                      -

    Diluted

$                      -


$                      -


$               (0.01)


$                      -

Net income attributable to Duke Energy Corporation common shareholders








    Basic

$                0.86


$                0.48


$                0.72


$                1.37

    Diluted

$                0.86


$                0.48


$                0.72


$                1.37

  Dividends Declared Per Share

$                0.78


$              1.545


$                1.56


$              2.310

  Weighted-Average Shares Outstanding








    Basic

707


706


707


705

    Diluted

707


706


707


706









SEGMENT INCOME BY BUSINESS SEGMENT








Regulated Utilities(a)(b)

$                 689


$                 353


$              1,426


$              1,009

International Energy

146


87


276


184

Commercial Power(c)(d)

(120)


41


(999)


(1)

Total Reportable Segment Income

715


481


703


1,192

Other Net Expense(e)(f)

(103)


(139)


(185)


(216)

Loss from Discontinued Operations, net of tax

(3)


(3)


(6)


(3)

Net Income Attributable to Duke Energy Corporation

$                 609


$                 339


$                 512


$                 973









CAPITALIZATION








Total Common Equity





48%


49%

Total Debt





52%


51%









Total Debt





$            42,460


$            41,408

Book Value Per Share





$              57.80


$              56.95

Actual Shares Outstanding





707


706









CAPITAL AND INVESTMENT EXPENDITURES








Regulated Utilities

$              1,073


$              1,250


$              2,175


$              2,543

International Energy

16


42


25


67

Commercial Power

100


14


168


26

Other

25


64


86


128









Total Capital and Investment Expenditures

$              1,214


$              1,370


$              2,454


$              2,764

















(a)

Includes an impairment charge of $180 million for the three and six months ended June 30, 2013 related to the 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 an impairment charge related to the planned sale of the Midwest Generation assets of $867 million for the six months ended June 30, 2014 (net of tax of $514 million).

(d)

Includes mark-to-market losses on economic hedges of $136 million for the three months ended June 30, 2014 (net of tax of $77 million), and $158 million for the six months ended June 30, 2014 (net of tax of $89 million).

(e)

Includes costs to achieve Progress merger of $38 million for the three months ended June 30, 2014 (net of tax of $23 million), and $72 million for the six months ended June 30, 2014 (net of tax of $44 million).

(f)

Includes costs to achieve 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 2014

QUARTERLY HIGHLIGHTS

(Unaudited)










Three Months Ended


Six Months Ended


June 30,


June 30,









(In millions, except where noted)

2014


2013


2014


2013

REGULATED UTILITIES








  Operating Revenues

$                       5,283


$                       4,920


$                      11,088


$                       9,980

  Operating Expenses(a)(b)

4,019


4,165


8,446


8,005

  Gains on Sales of Other Assets, net

-


4


1


6

  Operating Income

1,264


759


2,643


1,981

  Other Income and Expenses

62


48


131


109

  Interest Expense

275


242


545


478

  Income Before Income Taxes

1,051


565


2,229


1,612

  Income Tax Expense(c)(d)

362


212


803


603

  Segment Income

$                           689


$                           353


$                        1,426


$                        1,009









  Depreciation and Amortization

$                           688


$                           556


$                        1,365


$                        1,092









  Duke Energy Carolinas GWh sales

20,836


20,202


44,529


42,448

  Duke Energy Progress GWh sales

14,693


14,055


30,854


28,756

  Duke Energy Florida GWh sales

9,840


9,853


18,501


17,869

  Duke Energy Ohio GWh sales

5,824


5,800


12,303


11,978

  Duke Energy Indiana GWh sales

8,455


7,937


17,329


16,442

  Total GWh sales

59,648


57,847


123,516


117,493

  Net Proportional MW Capacity in Operation





49,452


49,560









INTERNATIONAL ENERGY








  Operating Revenues

$                           364


$                           406


$                           746


$                           798

  Operating Expenses

254


270


485


533

  Gains on Sales of Other Assets, net

5


-


5


-

  Operating Income

115


136


266


265

  Other Income and Expenses

52


14


109


47

  Interest Expense

23


17


46


38

  Income Before Income Taxes

144


133


329


274

  Income Tax Expense

(5)


42


46


84

  Less: Income Attributable to Noncontrolling Interests

3


4


7


6

  Segment Income

$                            146


$                              87


$                           276


$                            184









  Depreciation and Amortization

$                              27


$                              24


$                              50


$                              50









  Sales, GWh

4,281


4,926


9,522


9,682

  Proportional MW Capacity in Operation





4,411


4,584









COMMERCIAL POWER








  Operating Revenues(e)

$                           309


$                           557


$                           758


$                        1,009

  Operating Expenses(f)

502


508


2,364


1,041

  Gains on Sales of Other Assets, net

1


1


1


1

  Operating (Loss) Income

(192)


50


(1,605)


(31)

  Other Income and Expenses

5


-


10


11

  Interest Expense

23


17


38


32

  (Loss) Income Before Income Taxes

(210)


33


(1,633)


(52)

  Income Tax Benefit(g)(h)

(90)


(8)


(634)


(51)

  Segment (Loss) Income

$                          (120)


$                               41


$                         (999)


$                                (1)









  Depreciation and Amortization

$                              20


$                              62


$                               81


$                            125









  Actual Coal-fired Plant Production, GWh

3,087


4,185


7,798


8,734

  Actual Gas-fired Plant Production, GWh

3,981


3,341


7,773


7,238

  Actual Renewable Plant Production, GWh

1,469


1,415


3,058


2,820

  Actual Plant Production, GWh

8,537


8,941


18,629


18,792

  Net Proportional MW Capacity in Operation





7,839


8,127









OTHER 








  Operating Revenues

$                              28


$                              36


$                              53


$                               71

  Operating Expenses(i)(j)

100


156


184


246

  Losses on Sales of Other Assets, net

-


(4)


-


(4)

  Operating Loss

(72)


(124)


(131)


(179)

  Other Income and Expenses

15


8


22


19

  Interest Expense

103


105


208


200

  Loss Before Income Taxes

(160)


(221)


(317)


(360)

  Income Tax Benefit(k)(l)

(58)


(81)


(133)


(141)

  Less: Income (Loss) Attributable to Noncontrolling Interests

1


(1)


1


(3)

  Segment Net Expense

$                          (103)


$                          (139)


$                          (185)


$                          (216)









  Depreciation and Amortization

$                              26


$                              36


$                              55


$                               71

















(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 to nuclear development costs.

(c)

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.

(d)

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.

(e)

Includes mark-to-market losses on economic hedges of $185 million for the three months ended June 30, 2014 and $309 million for the six months ended June 30, 2014.

(f)

Includes a pre-tax impairment charge of $1,381 million for the six months ended June 30, 2014, related to the planned sale of the Midwest Generation assets.

(g)

Includes a tax benefit of $77 million for the three months ended June 30, 2014 and $89 million for the six months ended June 30, 2014, related to the mark-to-market losses on economic hedges.

(h)

Includes a tax benefit of $514 million for the six months ended June 30, 2014, on the impairment related to the planned sale of the Midwest Generation assets.

(i)

Includes costs to achieve Progress merger of $61 milion recorded in Operating Expense for the three months ended June 30, 2014, and $114 million recorded in Operating Expense for the six months ended June 30, 2014.

(j)

Includes costs to achieve Progress merger of $92 milion recorded in Operating Expense for the three months ended June 30, 2013, and $162 million recorded in Operating Expense for the six months ended June 30, 2013.

(k)

Includes tax benefit related to costs to achieve Progress merger of $23 million for the three months ended June 30, 2014, and $44 million for the six months ended June 30, 2014.

(l)

Includes tax benefit related to costs to achieve Progress merger 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,









2014

2013


2014

2013

Operating Revenues






Regulated electric

$         5,167

$         4,834


$       10,745

$         9,723

Nonregulated electric, natural gas, and other

675

951


1,499

1,775

Regulated natural gas

107

94


329

279

Total operating revenues

5,949

5,879


12,573

11,777

Operating Expenses






Fuel used in electric generation and purchased power - regulated

1,808

1,678


3,808

3,381

Fuel used in electric generation and purchased power - nonregulated 

436

447


845

901

Cost of natural gas and other

43

43


165

147

Operation, maintenance and other

1,467

1,504


2,973

2,925

Depreciation and amortization

761

678


1,551

1,338

Property and other taxes

318

323


676

666

Impairment charges

6

386


1,388

386

Total operating expenses

4,839

5,059


11,406

9,744

Gains on Sales of Other Assets and Other, net

6

1


7

3

Operating Income

1,116

821


1,174

2,036

Other Income and Expenses






Equity in earnings of unconsolidated affiliates

33

22


69

58

Other income and expenses, net

89

48


184

128

Total other income and expenses

122

70


253

186

Interest Expense

413

381


819

748

Income From Continuing Operations Before Income Taxes

825

510


608

1,474

Income Tax Expense from Continuing Operations

209

165


82

495

Income From Continuing Operations

616

345


526

979

Loss From Discontinued Operations, net of tax

(3)

(3)


(6)

(3)

Net Income

613

342


520

976

Less: Net Income Attributable to Noncontrolling Interests 

4

3


8

3

Net Income Attributable to Duke Energy Corporation

$            609

$            339


$            512

$            973









-

-


-

-














Earnings Per Share - Basic and Diluted






Income from continuing operations attributable to Duke Energy Corporation common shareholders




Basic 







$           0.86

$           0.48


$           0.73

$           1.37


Diluted







$           0.86

$           0.48


$           0.73

$           1.37

Loss from discontinued operations attributable to Duke Energy Corporation common shareholders




Basic 







$                -

$                -


$          (0.01)

$                -


Diluted







$                -

$                -


$          (0.01)

$                -

Net Income attributable to Duke Energy Corporation common shareholders





Basic 







$           0.86

$           0.48


$           0.72

$           1.37


Diluted







$           0.86

$           0.48


$           0.72

$           1.37

Weighted-average shares outstanding







Basic







707

706


707

705


Diluted







707

706


707

706

 

 

DUKE ENERGY CORPORATION
CONSOLIDATED
BALANCE SHEETS
(Unaudited)
(In millions)










June 30,


December 31,




2014


2013

ASSETS





Current Assets





Cash and cash equivalents


$               2,008


$               1,501

Short-term investments


-


44

Receivables (net of allowance for doubtful accounts of 


877


1,286


$18 at June 30, 2014 and $30 at December 31, 2013)





Restricted receivables of variable interest entities (net of allowance for 


2,118


1,719


doubtful accounts of $54 at June 30, 2014 and $43 at December 31, 2013)





Inventory


3,056


3,250

Assets held for sale


409


-

Regulatory assets


1,349


895

Other


1,698


1,821


Total current assets


11,515


10,516

Investments and Other Assets





Investments in equity method unconsolidated affiliates


381


390

Nuclear decommissioning trust funds


5,417


5,132

Goodwill


16,343


16,340

Assets held for sale


2,195


107

Other


3,227


3,432


Total investments and other assets


27,563


25,401

Property, Plant and Equipment





Cost


100,885


103,115

Accumulated depreciation and amortization


(33,977)


(33,625)


Net property, plant and equipment


66,908


69,490

Regulatory Assets and Deferred Debits





Regulatory assets 


9,009


9,191

Other


178


181


Total regulatory assets and deferred debits


9,187


9,372

Total Assets


$           115,173


$           114,779

LIABILITIES AND EQUITY





Current Liabilities





Accounts payable


$               1,782


$               2,391

Notes payable and commercial paper


1,867


839

Taxes accrued


522


551

Interest accrued


453


440

Current maturities of long-term debt


1,887


2,104

Liabilities associated with assets held for sale


271


7

Regulatory liabilities


140


316

Other


1,786


1,996


Total current liabilities


8,708


8,644

Long-term Debt


38,706


38,152

Deferred Credits and Other Liabilities





Deferred income taxes


12,014


12,097

Investment tax credits


435


442

Accrued pension and other post-retirement benefit costs


1,263


1,322

Liabilities associated with assets held for sale


75


66

Asset retirement obligations


5,030


4,950

Regulatory liabilities


6,338


5,949

Other


1,723


1,749


Total deferred credits and other liabilities


26,878


26,575

Equity





Common stock, $0.001 par value, 2 billion shares authorized; 707 million 


1


1


and 706 million shares outstanding at June 30, 2014 and 






December 31, 2013, respectively





Additional paid-in capital


39,389


39,365

Retained earnings


1,768


2,363

Accumulated other comprehensive loss


(355)


(399)


Total Duke Energy Corporation stockholders' equity


40,803


41,330

Noncontrolling interests


78


78


Total equity


40,881


41,408

Total Liabilities and Equity


$           115,173


$           114,779

 

 

DUKE ENERGY CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In millions)







Six Months Ended June 30,







2014


2013










CASH FLOWS FROM OPERATING ACTIVITIES






Net Income



$                 520


$                  976


Adjustments to reconcile net income to net cash provided by







operating activities:


2,099


1,867





Net cash provided by operating activities


2,619


2,843










CASH FLOWS FROM INVESTING ACTIVITIES









Net cash used in investing activities


(2,367)


(2,562)










CASH FLOWS FROM FINANCING ACTIVITIES









Net cash provided by (used in) financing activities

255


(134)











Net increase in cash and cash equivalents


507


147


Cash and cash equivalents at beginning of period


1,501


1,424


Cash and cash equivalents at end of period


$              2,008


$               1,571

 

 

Regulated Utilities

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

June 2014






















Three Months Ended


Six Months Ended




June 30


June 30








%


% Inc.(Dec.)






%


% Inc.(Dec.)










Weather 








Weather 




2014


2013


Inc. (Dec.)


Normal (2)


2014


2013


Inc. (Dec.)


Normal (2)



















GWH Sales (1)


















Residential


17,911


17,857


0.3%


0.1%


42,104


39,591


6.3%


1.6%


General Service


18,725


18,431


1.6%


0.5%


36,872


35,976


2.5%


2.0%


Industrial


13,081


12,821


2.0%


0.8%


25,136


24,746


1.6%


0.6%


Other Energy Sales


153


149


2.7%




303


300


1.0%




Unbilled Sales


1,164


549


112.0%


n/a


580


343


69.1%


n/a


    Total Retail Sales


51,034


49,807


2.5%


0.4%


104,995


100,956


4.0%


1.5%




















Special Sales


8,614


8,040


7.1%




18,521


16,537


12.0%






















    Total Consolidated Electric Sales - Regulated Utilities


59,648


57,847


3.1%




123,516


117,493


5.1%







































Average Number of Customers


















Residential


6,266,316


6,205,209


1.0%




6,265,818


6,203,184


1.0%




General Service


941,986


935,671


0.7%




940,517


933,951


0.7%




Industrial


18,308


18,635


(1.8%)




18,341


18,662


(1.7%)




Other Energy Sales


22,468


22,193


1.2%




22,464


22,152


1.4%




  Total Regular Sales


7,249,078


7,181,708


0.9%




7,247,140


7,177,949


1.0%






















Special Sales


60


61


(1.6%)




62


62


0.0%






















    Total Average Number of Customers - Regulated Utilities


7,249,138


7,181,769


0.9%




7,247,202


7,178,011


1.0%

























































Heating and Cooling Degree Days (3)


















Carolinas - Actual


















Heating Degree Days


156


232


(32.8%)




2,125


2,007


5.9%




Cooling Degree Days


593


466


27.3%




593


467


27.0%






















Variance from Normal


















Heating Degree Days


(15.7%)


22.8%


n/a




15.4%


6.6%


n/a




Cooling Degree Days


10.2%


(14.3%)


n/a




8.2%


(15.2%)


n/a






















Midwest - Actual


















Heating Degree Days 


443


462


(4.1%)




3,756


3,296


14.0%




Cooling Degree Days


350


338


3.6%




350


338


3.6%






















Variance from Normal


















Heating Degree Days 


4.2%


3.6%


n/a




22.3%


5.3%


n/a




Cooling Degree Days


(0.3%)


(0.9%)


n/a




(1.7%)


(1.5%)


n/a








































Florida - Actual


















Heating Degree Days


1


-


n/a




418


338


23.7%




Cooling Degree Days


1,061


1,041


1.9%




1,205


1,220


(1.2%)






















Variance from Normal


















Heating Degree Days


(90.9%)


(100.0%)


n/a




0.7%


(18.8%)


n/a




Cooling Degree Days


0.7%


(1.2%)


n/a




(2.1%)


(0.8%)


n/a








































(1)  Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes. 




















(2)  Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).




















(3)  Certain 2013 data has been recast to conform to the 2014 methodology which provides for consistency across all Regulated Utilities' jurisdictions.

 

 

Duke Energy Carolinas


Quarterly Highlights


Supplemental Regulated Utilities Electric Information


June 2014
























Three Months Ended


Six Months Ended





June 30


June 30











% Inc.(Dec.)








% Inc.(Dec.)









%


Weather 






%


Weather 





2014


2013


Inc.(Dec.)


Normal (2)


2014


2013


Inc.(Dec.)


Normal (2)





















GWH Sales (1)



















Residential


5,872


5,818


0.9%




14,436


13,523


6.8%





General Service


6,953


6,777


2.6%




13,734


13,303


3.2%





Industrial


5,467


5,329


2.6%




10,381


10,140


2.4%





Other Energy Sales


76


72


5.6%




149


146


2.1%





Unbilled Sales


366


16


2187.5%




185


26


611.5%





    Total Regular Electric Sales 


18,734


18,012


4.0%


0.6%


38,885


37,138


4.7%


1.5%






















Special Sales


2,102


2,190


(4.0%)




5,644


5,310


6.3%
























Total Electric Sales - Duke Energy Carolinas


20,836


20,202


3.1%




44,529


42,448


4.9%










































Average Number of Customers



















Residential


2,083,576


2,064,385


0.9%




2,082,721


2,063,362


0.9%





General Service


341,212


338,779


0.7%




340,700


338,147


0.8%





Industrial


6,531


6,627


(1.4%)




6,527


6,639


(1.7%)





Other Energy Sales


14,505


14,412


0.6%




14,495


14,381


0.8%





  Total Regular Sales


2,445,824


2,424,203


0.9%




2,444,443


2,422,529


0.9%
























Special Sales


24


24


0.0%




25


24


4.2%
























Total Average Number of Customers - Duke Energy Carolinas

2,445,848


2,424,227


0.9%




2,444,468


2,422,553


0.9%





























































Heating and Cooling Degree Days (3)



















Actual



















Heating Degree Days


181


249


(27.3%)




2,223


2,106


5.6%





Cooling Degree Days


557


438


27.2%




557


438


27.2%
























Variance from Normal



















Heating Degree Days


(10.0%)


20.9%


n/a




16.0%


7.4%


n/a





Cooling Degree Days


8.4%


(15.1%)


n/a




6.5%


(16.3%)


n/a











































(1)  Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes. 





















(2)  Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).





















(3)  Certain 2013 data has been recast to conform to the 2014 methodology which provides for consistency across all Regulated Utilities' jurisdictions.


 

 

Duke Energy Progress

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

June 2014





















Three Months Ended


Six Months Ended




June 30


June 30










% Inc.(Dec.)








% Inc.(Dec.)








%


Weather 






%


Weather 




2014


2013


Inc.(Dec.)


Normal (2)


2014


2013


Inc.(Dec.)


Normal (2)



















GWH Sales (1)


















Residential


3,959


3,812


3.9%




9,539


8,771


8.8%




General Service


3,769


3,675


2.6%




7,410


7,157


3.5%




Industrial


2,616


2,664


(1.8%)




4,997


5,108


(2.2%)




Other Energy Sales


29


30


(3.3%)




59


60


(1.7%)




Unbilled Sales


(30)


(48)


37.5%




(27)


(13)


(107.7%)




    Total Regular Electric Sales 


10,343


10,133


2.1%


(1.5%)


21,978


21,083


4.2%


0.4%




















Special Sales


4,350


3,922


10.9%




8,876


7,673


15.7%






















Total Electric Sales - Duke Energy Progress


14,693


14,055


4.5%




30,854


28,756


7.3%







































Average Number of Customers


















Residential


1,253,519


1,240,416


1.1%




1,252,564


1,238,992


1.1%




General Service


223,061


221,592


0.7%




222,477


220,900


0.7%




Industrial


4,277


4,375


(2.2%)




4,284


4,385


(2.3%)




Other Energy Sales


1,730


1,812


(4.5%)




1,741


1,812


(3.9%)




  Total Regular Sales


1,482,587


1,468,195


1.0%




1,481,066


1,466,089


1.0%






















Special Sales


15


15


0.0%




15


15


0.0%






















Total Average Number of Customers - Duke Energy Progress

1,482,602


1,468,210


1.0%




1,481,081


1,466,104


1.0%

























































Heating and Cooling Degree Days (3)


















Actual


















Heating Degree Days


131


214


(38.8%)




2,027


1,909


6.2%




Cooling Degree Days


629


494


27.3%




629


496


26.8%






















Variance from Normal


















Heating Degree Days


(22.0%)


25.1%


n/a




14.7%


5.9%


n/a




Cooling Degree Days


11.7%


(13.5%)


n/a




9.6%


(14.3%)


n/a






















(1)  Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes. 






















(2)  Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).
































(3)  Certain 2013 data has been recast to conform to the 2014 methodology which provides for consistency across all Regulated Utilities' jurisdictions.

 

 

Duke Energy Florida

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

June 2014






















Three Months Ended


Six Months Ended




June 30


June 30










% Inc.(Dec.)








% Inc.(Dec.)








%


Weather 






%


Weather 




2014


2013


Inc.(Dec.)


Normal (2)


2014


2013


Inc.(Dec.)


Normal (2)



















GWH Sales (1)


















Residential


4,396


4,491


(2.1%)




8,447


8,235


2.6%




General Service


3,702


3,694


0.2%




6,950


6,918


0.5%




Industrial


803


827


(2.9%)




1,604


1,582


1.4%




Other Energy Sales


6


6


0.0%




12


12


0.0%




Unbilled Sales


592


379


56.2%




731


413


77.0%




    Total Regular Sales


9,499


9,397


1.1%


0.5%


17,744


17,160


3.4%


1.8%




















Special Sales


341


456


(25.2%)




757


709


6.8%






















  Total Electric Sales - Duke Energy Florida


9,840


9,853


(0.1%)




18,501


17,869


3.5%







































Average Number of Customers


















Residential


1,498,175


1,476,411


1.5%




1,495,267


1,475,080


1.4%




General Service


190,979


188,839


1.1%




190,708


188,591


1.1%




Industrial


2,279


2,357


(3.3%)




2,290


2,359


(2.9%)




Other Energy Sales


1,556


1,567


(0.7%)




1,556


1,568


(0.8%)




  Total Regular Sales


1,692,989


1,669,174


1.4%




1,689,821


1,667,598


1.3%






















Special Sales


14


15


(6.7%)




15


15


0.0%






















Total Average Number of Customers - Duke Energy Florida

1,693,003


1,669,189


1.4%




1,689,836


1,667,613


1.3%

























































Heating and Cooling Degree Days (3)


















Actual


















Heating Degree Days


1


-


n/a




418


338


23.7%




Cooling Degree Days


1,061


1,041


1.9%




1,205


1,220


(1.2%)






















Variance from Normal


















Heating Degree Days


(90.9%)


(100.0%)


n/a




0.7%


(18.8%)


n/a




Cooling Degree Days


0.7%


(1.2%)


n/a




(2.1%)


(0.8%)


n/a






















(1)  Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes. 






















(2)  Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).
































(3)  Certain 2013 data has been recast to conform to the 2014 methodology which provides for consistency across all Regulated Utilities' jurisdictions.

 

 

Duke Energy Ohio

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

June 2014






















Three Months Ended


Six Months Ended




June 30


June 30










% Inc. (Dec.)








% Inc. (Dec.)








%


Weather






%


Weather




2014


2013


Inc.(Dec.)


 Normal (2)


2014


2013


Inc.(Dec.)


 Normal (2)



















GWH Sales (1)


















Residential


1,813


1,837


(1.3%)




4,592


4,335


5.9%




General Service


2,299


2,283


0.7%




4,671


4,565


2.3%




Industrial


1,494


1,423


5.0%




2,930


2,819


3.9%




Other Energy Sales


28


28


0.0%




56


56


0.0%




Unbilled Sales


160


130


23.1%




(82)


(16)


(412.5%)




    Total Regular Electric Sales


5,794


5,701


1.6%


2.6%


12,167


11,759


3.5%


2.3%




















Special Sales


30


99


(69.7%)




136


219


(37.9%)






















    Total Electric Sales - Duke Energy Ohio


5,824


5,800


0.4%




12,303


11,978


2.7%







































Average Number of Customers


















Residential


741,069


737,683


0.5%




742,324


737,483


0.7%




General Service


86,497


86,233


0.3%




86,374


86,145


0.3%




Industrial 


2,519


2,557


(1.5%)




2,521


2,559


(1.5%)




Other Energy


3,171


2,934


8.1%




3,171


2,930


8.2%




  Total Regular Sales


833,256


829,407


0.5%




834,390


829,117


0.6%






















Special Sales


1


1


0.0%




1


1


0.0%






















Total Average Number of Electric Customers -
Duke Energy Ohio


833,257


829,408


0.5%




834,391


829,118


0.6%

























































Heating and Cooling Degree Days (3)


















Actual


















Heating Degree Days 


361


423


(14.7%)




3,470


3,126


11.0%




Cooling Degree Days


382


346


10.4%




382


346


10.4%






















Variance from Normal


















Heating Degree Days 


(11.7%)


(0.7%)


n/a




16.8%


3.3%


n/a




Cooling Degree Days


10.7%


3.0%


n/a




9.1%


2.4%


n/a








































(1)  Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes. 




















(2)  Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).




















(3)  Certain 2013 data has been recast to conform to the 2014 methodology which provides for consistency across all Regulated Utilities' jurisdictions.

 

 

Duke Energy Ohio

Quarterly Highlights

Supplemental Regulated Utilities Gas Information

June 2014






















Three Months Ended


Six Months Ended




June 30


June 30










% Inc. (Dec.)








% Inc. (Dec.)








%


Weather






%


Weather




2014


2013


Inc.(Dec.)


 Normal (2)


2014


2013


Inc.(Dec.)


 Normal (2)



















MCF Sales (1)


















Residential


5,948,555


6,575,647


(9.5%)




29,534,496


26,620,497


10.9%




General Service


3,931,932


4,151,037


(5.3%)




17,624,423


15,799,582


11.5%




Industrial 


1,508,405


1,281,485


17.7%




4,321,235


3,688,976


17.1%




Other Energy Sales


4,822,263


4,733,817


1.9%




11,419,293


10,888,315


4.9%




Unbilled Sales


(2,435,000)


(4,003,000)


39.2%




(4,902,000)


(4,915,000)


0.3%




    Total Gas Sales - Duke Energy Ohio


13,776,155


12,738,986


8.1%


3.1%


57,997,447


52,082,370


11.4%


2.3%





































Average Number of Customers


















Residential


472,847


470,301


0.5%




474,482


470,936


0.8%




General Service


43,330


43,300


0.1%




44,316


44,151


0.4%




Industrial


1,609


1,625


(1.0%)




1,663


1,657


0.4%




Other Energy


155


165


(6.1%)




156


166


(6.0%)




Total Average Number of Gas Customers - Duke Energy Ohio


517,941


515,391


0.5%




520,617


516,910


0.7%







































Heating and Cooling Degree Days (3)


















Actual


















Heating Degree Days 


361


423


(14.7%)




3,470


3,126


11.0%




Cooling Degree Days


382


346


10.4%




382


346


10.4%






















Variance from Normal


















Heating Degree Days 


(11.7%)


(0.7%)


n/a




16.8%


3.3%


n/a




Cooling Degree Days


10.7%


3.0%


n/a




9.1%


2.4%


n/a








































(1)  Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes. 




















(2)  Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).




















(3)  Certain 2013 data has been recast to conform to the 2014 methodology which provides for consistency across all Regulated Utilities' jurisdictions.

 

 

Duke Energy Indiana

Quarterly Highlights

Supplemental Regulated Utilities Electric Information

June 2014






















Three Months Ended


Six Months Ended




June 30


June 30










% Inc. (Dec.)








% Inc. (Dec.)








%


Weather






%


Weather




2014


2013


Inc.(Dec.)


 Normal (2)


2014


2013


Inc.(Dec.)


 Normal (2)



















GWH Sales (1)


















Residential


1,871


1,899


(1.5%)




5,090


4,727


7.7%




General Service


2,002


2,002


0.0%




4,107


4,033


1.8%




Industrial


2,701


2,578


4.8%




5,224


5,097


2.5%




Other Energy Sales


14


13


7.7%




27


26


3.8%




Unbilled Sales


76


72


5.6%




(227)


(67)


(238.8%)




    Total Regular Electric Sales


6,664


6,564


1.5%


1.2%


14,221


13,816


2.9%


2.0%




















Special Sales


1,791


1,373


30.4%




3,108


2,626


18.4%






















    Total Electric Sales - Duke Energy Indiana


8,455


7,937


6.5%




17,329


16,442


5.4%







































Average Number of Customers


















Residential


689,977


686,314


0.5%




692,942


688,267


0.7%




General Service


100,237


100,228


0.0%




100,258


100,168


0.1%




Industrial 


2,702


2,719


(0.6%)




2,719


2,720


(0.0%)




Other Energy


1,506


1,468


2.6%




1,501


1,461


2.7%




  Total Regular Sales


794,422


790,729


0.5%




797,420


792,616


0.6%






















Special Sales


6


6


0.0%




6


7


(14.3%)






















Total Average Number of Electric Customers - Duke Energy Indiana


794,428


790,735


0.5%




797,426


792,623


0.6%

























































Heating and Cooling Degree Days (3)


















Actual


















Heating Degree Days 


525


499


5.2%




4,042


3,465


16.7%




Cooling Degree Days


318


329


(3.3%)




318


329


(3.3%)






















Variance from Normal


















Heating Degree Days 


18.5%


7.8%


n/a




27.5%


7.1%


n/a




Cooling Degree Days


(10.9%)


-4.4%


n/a




(12.2%)


(4.9%)


n/a








































(1)  Except as indicated in footnote (2), represents non-weather normalized billed sales, with energy delivered but not yet billed (i.e. unbilled sales) reflected as a single amount and not allocated to the respective retail classes. 




















(2)  Represents weather normal total retail calendar sales (i.e. billed and unbilled sales).




















(3)  Certain 2013 data has been recast to conform to the 2014 methodology which provides for consistency across all Regulated Utilities' jurisdictions.

 

 


DUKE ENERGY CORPORTATION
ADJUSTED TO REPORTED EARNINGS RECONCILIATION
Three Months Ended June 30, 2014
(Dollars in millions, except per-share amounts)







Special Items














Adjusted Earnings


Costs to
Achieve, Progress Merger


Economic
Hedges
(Mark-to-Market) *


Discontinued Operations


Total Adjustments


Reported Earnings

SEGMENT INCOME






































Regulated Utilities


$

689



$



$



$



$



$

689





















International Energy


146











146





















Commercial Power


16





(136)


B



(136)



(120)





















Total Reportable Segment Income


851





(136)





(136)



715





















Other


(65)



(38)


A





(38)



(103)





















Total Reportable Segment Income and Other Net Expense


786



(38)



(136)





(174)



612





















Discontinued Operations








(3)


C

(3)



(3)





















Net Income (Loss) Attributable to Duke Energy Corporation


$

786



$

(38)



$

(136)



$

(3)



$

(177)



$

609





















EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, BASIC


$

1.11



$

(0.06)



$

(0.19)



$



$

(0.25)



$

0.86





















EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, DILUTED


$

1.11



$

(0.06)



$

(0.19)



$



$

(0.25)



$

0.86





















A - Net of $23 million tax benefit. $61 million recorded in Operating Expenses on the Condensed Consolidated Statements of Operations.

B - Net of $77 million tax benefit. $185 million loss recorded within Nonregulated electric, natural gas, and other (Operating Revenues) and $28 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.

 


Weighted Average Shares (reported and adjusted) - in millions


     Basic


707


     Diluted


707

 

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

 

 

DUKE ENERGY CORPORATION
ADJUSTED TO REPORTED EARNINGS RECONCILIATION
Six Months Ended June 30, 2014
(Dollars in millions, except per-share amounts)







Special Items














Adjusted Earnings


Costs to Achieve, Progress Merger


Midwest Generation Impairment


Economic Hedges (Mark-to-Market) *


Discontinued Operations


Total Adjustments


Reported Earnings

SEGMENT INCOME












































Regulated Utilities


$

1,426



$



$



$



$



$



$

1,426
























International Energy


276













276
























Commercial Power


26





(867)


C

(158)


B



(1,025)



(999)
























Total Reportable Segment Income


1,728





(867)



(158)





(1,025)



703
























Other


(113)



(72)


A







(72)



(185)
























Total Reportable Segment Income and Other Net Expense


1,615



(72)



(867)



(158)





(1,097)



518
























Discontinued Operations










(6)


D

(6)



(6)
























Net Income (Loss) Attributable to Duke Energy Corporation


$

1,615



$

(72)



$

(867)



$

(158)



$

(6)



$

(1,103)



$

512
























EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, BASIC


$

2.28



$

(0.10)



$

(1.23)



$

(0.22)



$

(0.01)



$

(1.56)



$

0.72
























EPS ATTRIBUTABLE TO DUKE ENERGY CORPORATION, DILUTED


$

2.28



$

(0.10)



$

(1.23)



$

(0.22)



$

(0.01)



$

(1.56)



$

0.72
























A - Net of $44 million tax benefit. $1 million recorded as a decrease in Operating Revenues, $114 million recorded within Operating Expenses and $1 million recorded within Interest Expense on the Condensed Consolidated Statements of Operations.


B - Net of $89 million tax benefit. $309 million loss recorded within Nonregulated electric, natural gas, and other (Operating Revenues) and $62 million gain recorded within Fuel used in electric generation and purchased power-nonregulated (Operating Expenses) on the Condensed Consolidated Statements of Operations.


C - Net of $514 million tax benefit. Recorded in Impairment charges (Operating Expenses) on the Condensed Consolidated Statement of Operations.


D - 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



707




     Diluted



707



 

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

 

 

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 Merger


Nuclear Development Charges


Litigation Reserve


Crystal River Unit 3 Impairment


Economic Hedges (Mark-to-Market) *


Discontinued Operations


Total Adjustments


Reported Earnings

SEGMENT INCOME
























































Regulated Utilities


$

590



$



$

(57)


D

$



$

(180)


F

$



$



$

(237)



$

353






























International Energy


87

















87






























Commercial Power


(3)











44


B



44



41






























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 Operating Revenues, $92 million recorded within Operating Expenses and $1 million recorded within Interest Expense on the Condensed Consolidated Statements of Operations.

B - Net of $29 million tax benefit. $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 Statement of Operations.

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

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


Weighted Average Shares (reported and adjusted) - in millions


     Basic


706


     Diluted


706

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


Nuclear Development Charges


Litigation Reserve


Crystal River Unit 3 Impairment


Economic Hedges (Mark-to-Market) *


Discontinued Operations


Total Adjustments


Reported Earnings

SEGMENT INCOME
























































Regulated Utilities


$

1,246



$



$

(57)


D

$



$

(180)


F

$



$



$

(237)



$

1,009






























International Energy


184

















184






























Commercial Power


3











(4)


B



(4)



(1)






























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 Nonregulated electric, natural gas, and other (Operating Revenues) and $17 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 Statement of Operations.

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

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


Weighted Average Shares (reported and adjusted) - in millions



Basic

705





Diluted

706





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

 

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SOURCE Duke Energy



RELATED LINKS
http://www.duke-energy.com

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