Portland General Electric announces third quarter 2019 results

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Portland General Electric announces third quarter 2019 results

- Maintaining full-year 2019 earnings guidance of $2.35-$2.50 per share, expecting to be in the lower half of the range
- Accelerating clean energy efforts with progress on Integrated Resource Plan and filing of Transportation Electrification plan
- Increasing capital expenditures with a focus on transmission and distribution upgrades

PORTLAND, Ore., Nov. 1, 2019 /PRNewswire/ -- Portland General Electric Company (NYSE: POR) today reported net income of $55 million, or 61 cents per diluted share, for the third quarter of 2019. This compares with net income of $53 million, or 59 cents per diluted share, for the third quarter of 2018. PGE reaffirmed its 2019 earnings guidance range of $2.35 to $2.50 per diluted share and expects to be in the lower half of the range.

"Our financial performance this quarter was strong. In a summer with milder temperatures and unfavorable hydro conditions, we effectively managed our power supply and benefited from increased wind and thermal production," said Maria Pope, PGE president and CEO. "I am pleased to announce that we've broken ground on our Integrated Operations Center and are continuing to invest in our hydro facilities and distribution assets for a smarter and more  resilient grid."

The increase in third quarter earnings was driven by favorable net variable power costs compared with the third quarter of 2018. Higher operating expenses were driven by wildfire mitigation, vegetation management and other miscellaneous items. A decrease in third quarter earnings was attributable to the absence of the Carty Generation Station cash settlement that occurred in 2018.

Company Updates

Integrated Resource Plan (IRP)

In July 2019, PGE filed with the Public Utility Commission of Oregon (OPUC) its 2019 IRP. As part of the OPUC's public review process, PGE is preparing to respond to comments provided by OPUC staff, consumer advocates, environmental groups and other stakeholders. PGE will request approval from the OPUC to issue one or more RFPs to acquire capacity and renewable resources following a final order expected in the first quarter of 2020. PGE is considering submission of a benchmark resource for both RFPs and will communicate its decision to submit a benchmark before doing so.

Transportation Electrification Plan

In September 2019, PGE filed its Transportation Electrification plan with the OPUC. The plan describes market conditions, PGE's current and planned activities, potential system impacts from transportation electrification, and relation to Oregon's carbon reduction goals.  The plan is required and aimed at accelerating transportation electrification in Oregon.

Capital Updates

PGE increased its capital plan by $145 million for the period 2019-2023. The company is planning to invest in projects to improve the resiliency and safety of transmission and distribution assets, as well as improving infrastructure resiliency and advancing an integrated grid.

2019 earnings guidance

PGE is reaffirming its 2019 guidance of $2.35 to $2.50 per diluted share and expects to be in the lower half of this range. This guidance is based on the following assumptions:

  • Flat weather-adjusted retail deliveries
  • Normal hydro conditions for the remainder of the year based on the current hydro forecast
  • Wind generation based on five years of historical levels or forecast studies when historical data is not available
  • Normal thermal plant operations
  • Depreciation and amortization expense between $400 million and $420 million
  • Operating and maintenance costs between $600 million and $620 million

Third Quarter 2019 earnings call and webcast — November 1, 2019

PGE will host a conference call with financial analysts and investors on Friday, November 1, 2019, at 11 a.m. ET. The conference call will be webcast live on the PGE website at investors.portlandgeneral.com. A replay of the call will be available beginning at 2 p.m. ET on Friday, November 1, 2019, through 1 p.m. ET on Friday, November 8, 2019.

Maria Pope, president and CEO; Jim Lobdell, senior vice president of Finance, CFO, and treasurer; and Chris Liddle, director, Investor Relations and Treasury, will participate in the call. Management will respond to questions following formal comments.

The attached unaudited condensed consolidated statements of income and comprehensive income, condensed consolidated balance sheets and condensed consolidated statements of cash flows, as well as the supplemental operating statistics, are an integral part of this earnings release.

About Portland General Electric Company

Portland General Electric (NYSE: POR) is a fully integrated energy company based in Portland, Oregon, serving 892,000 customers in 51 cities. For 130 years, PGE has been delivering safe, affordable and reliable energy to Oregonians. Together with its customers, PGE has the No. 1 voluntary renewable energy program in the U.S. With approximately 3,000 employees across the state, PGE is committed to helping its customers and the communities it serves build a clean energy future. For more information, visit PortlandGeneral.com/CleanVision.

Safe Harbor Statement

Statements in this news release that relate to future plans, objectives, expectations, performance, events and the like may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements regarding earnings guidance; statements regarding future load, hydro conditions and operating and maintenance costs; statements concerning implementation of the company's integrated resource plan; statements concerning future compliance with regulations limiting emissions from generation facilities and the costs to achieve such compliance; as well as other statements containing words such as "anticipates," "believes," "intends," "estimates," "promises," "expects," "should," "conditioned upon," and similar expressions. Investors are cautioned that any such forward-looking statements are subject to risks and uncertainties, including reductions in demand for electricity; the sale of excess energy during periods of low demand or low wholesale market prices; operational risks relating to the company's generation facilities, including hydro conditions, wind conditions, disruption of fuel supply, and unscheduled plant outages, which may result in unanticipated operating, maintenance and repair costs, as well as replacement power costs; failure to complete capital projects on schedule or within budget, or the abandonment of capital projects, which could result in the company's inability to recover project costs; the costs of compliance with environmental laws and regulations, including those that govern emissions from thermal power plants; changes in weather, hydroelectric and energy markets conditions, which could affect the availability and cost of purchased power and fuel; changes in capital market conditions, which could affect the availability and cost of capital and result in delay or cancellation of capital projects; the outcome of various legal and regulatory proceedings; general economic and financial market conditions; severe weather conditions, wildfires, and other natural phenomena and natural disasters that could result in operational disruptions, unanticipated restoration costs, or liability for third party property damage; and cyber security breaches of the company's customer information system or operating systems, which may affect customer bills or other aspects of our operations. As a result, actual results may differ materially from those projected in the forward-looking statements. All forward-looking statements included in this news release are based on information available to the company on the date hereof and such statements speak only as of the date hereof. The company expressly disclaims any current intention to update publicly any forward-looking statement after the distribution of this release, whether as a result of new information, future events, changes in assumptions or otherwise. Prospective investors should also review the risks, assumptions and uncertainties listed in the company's most recent annual report on form 10-K and in other documents that we file with the United States Securities and Exchange Commission, including management's discussion and analysis of financial condition and results of operations and the risks described therein from time to time.

POR

Source: Portland General Company

Media Contact:


Investor Contact:


Andrea Platt


Chris Liddle


Corporate Communications


Investor Relations


Phone: 503-464-7980


Phone: 503-464-7458


 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

AND COMPREHENSIVE INCOME

(Dollars in millions, except per share amounts)

(Unaudited)



Three Months Ended
September 30,


Nine Months Ended
September 30,


2019


2018


2019


2018

Revenues:








Revenues, net

$

538



$

525



$

1,570



$

1,469


Alternative revenue programs, net of amortization

4





5



(2)


Total revenues

542



525



1,575



1,467


Operating expenses:








Purchased power and fuel

165



186



449



420


Generation, transmission and distribution

78



72



241



212


Administrative and other

74



49



223



188


Depreciation and amortization

103



96



305



281


Taxes other than income taxes

34



31



101



95


Total operating expenses

454



434



1,319



1,196


Income from operations

88



91



256



271


Interest expense, net

32



31



95



93


Other income:








Allowance for equity funds used during construction

2



2



7



8


Miscellaneous income, net

3





5




Other income, net

5



2



12



8


Income before income tax expense

61



62



173



186


Income tax expense

6



9



20



23


Net income

55



53



153



163


Other comprehensive income





2




Comprehensive income

$

55



$

53



$

155



$

163










Weighted-average common shares outstanding (in thousands):








Basic

89,372



89,239



89,346



89,205


Diluted

89,594



89,239



89,555



89,205










Earnings per share:








Basic

$

0.61



$

0.59



$

1.71



$

1.82


Diluted

$

0.61



$

0.59



$

1.70



$

1.82










 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in millions)

(Unaudited)



September 30,
 2019


December 31,
 2018

ASSETS




Current assets:




Cash and cash equivalents

$

11



$

119


Accounts receivable, net

161



193


Unbilled revenues

73



96


Inventories

91



84


Regulatory assets—current

26



61


Other current assets

54



90


Total current assets

416



643


Electric utility plant, net

7,014



6,887


Regulatory assets—noncurrent

483



401


Nuclear decommissioning trust

46



42


Non-qualified benefit plan trust

37



36


Other noncurrent assets

158



101


Total assets

$

8,154



$

8,110






 


September 30,
 2019


December 31,
2018

LIABILITIES AND SHAREHOLDERS' EQUITY




Current liabilities:




Accounts payable

$

128



$

168


Liabilities from price risk management activities—current

26



55


Short-term debt




Current portion of long-term debt

50



300


Current portion of finance lease obligation

17




Accrued expenses and other current liabilities

293



268


Total current liabilities

514



791


Long-term debt, net of current portion

2,328



2,178


Regulatory liabilities—noncurrent

1,380



1,355


Deferred income taxes

378



369


Unfunded status of pension and postretirement plans

307



307


Liabilities from price risk management activities—noncurrent

100



101


Asset retirement obligations

268



197


Non-qualified benefit plan liabilities

100



103


Finance lease obligations, net of current portion

136




Other noncurrent liabilities

79



203


Total liabilities

5,590



5,604


Commitments and contingencies




Shareholders' Equity:




Preferred stock, no par value, 30,000,000 shares authorized; none issued and outstanding as of September 30, 2019 and December 31, 2018




Common stock, no par value, 160,000,000 shares authorized; 89,371,974 and 89,267,959 shares issued and outstanding as of September 30, 2019 and December 31, 2018, respectively

1,217



1,212


Accumulated other comprehensive loss

(7)



(7)


Retained earnings

1,354



1,301


Total shareholders' equity

2,564



2,506


Total liabilities and shareholders' equity

$

8,154



$

8,110



 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)



Nine Months Ended
September 30,


2019


2018

Cash flows from operating activities:




Net income

$

153



$

163


Adjustments to reconcile net income to net cash provided by operating activities:




Depreciation and amortization

305



281


Deferred income taxes

3



2


Pension and other postretirement benefits

16



19


Allowance for equity funds used during construction

(7)



(8)


Decoupling mechanism deferrals, net of amortization

(6)



2


(Amortization) Deferral of net benefits due to Tax Reform

(16)



37


Other non-cash income and expenses, net

38



8


Changes in working capital:




Decrease in accounts receivable and unbilled revenues

50



12


(Increase)/decrease in inventories

(7)



2


Decrease in margin deposits, net

4



6


(Decrease)/increase in accounts payable and accrued liabilities

(25)



17


Other working capital items, net

25



19


Other, net

(31)



(24)


Net cash provided by operating activities

502



536


Cash flows from investing activities:




Capital expenditures

(407)



(401)


Sales of Nuclear decommissioning trust securities

11



11


Purchases of Nuclear decommissioning trust securities

(8)



(9)


Proceeds from Carty settlement



120


Other, net

(2)



1


Net cash used in investing activities

(406)



(278)


Cash flows from financing activities:




Proceeds from issuance of long-term debt

200




Payments on long-term debt

(300)




Dividends paid

(99)



(93)


Other

(5)



(4)


Net cash used in financing activities

(204)



(97)


(Decrease) increase in cash and cash equivalents

(108)



161


Cash and cash equivalents, beginning of period

119



39


Cash and cash equivalents, end of period

$

11



$

200






Supplemental cash flow information is as follows:




Cash paid for interest, net of amounts capitalized

$

73



$

72


Cash paid for income taxes

21



20



 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

SUPPLEMENTAL OPERATING STATISTICS

(Unaudited)



Three Months Ended
September 30,


2019


2018

Revenues (dollars in millions):








Retail:








Residential

$

218



40

%


$

224



43

%

Commercial

167



31



171



32


Industrial

50



9



55



10


Direct access

13



2



9



2


Subtotal

448



82



459



87


Alternative revenue programs, net of amortization

4



1






Other accrued (deferred) revenues, net

4



1



(11)



(2)


Total retail revenues

456



84



448



85


Wholesale revenues

72



13



67



13


Other operating revenues

14



3



10



2


Total revenues

$

542



100

%


$

525



100

%









Energy deliveries (MWh in thousands):








Retail:








Residential

1,646



24

%


1,712



27

%

Commercial

1,738



26



1,837



28


Industrial

822



12



844



13


Subtotal

4,206



62



4,393



68


Direct access:








Commercial

195



3



170



2


Industrial

373



5



368



6


Subtotal

568



8



538



8


Total retail energy deliveries

4,774



70



4,931



76


Wholesale energy deliveries

2,015



30



1,529



24


Total energy deliveries

6,789



100

%


6,460



100

%









Average number of retail customers:








Residential

781,223



88

%


773,514



88

%

Commercial

109,589



12



110,028



12


Industrial

193





200




Direct access

632





604




Total

891,637



100

%


884,346



100

%

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

SUPPLEMENTAL OPERATING STATISTICS, continued

(Unaudited)



Three Months Ended
September 30,


2019


2018

Sources of energy (MWhs in thousands):








Generation:








Thermal:








Natural gas

2,881



44

%


2,777



45

%

Coal

1,450



22



1,054



17


Total thermal

4,331



66



3,831



62


Hydro

261



4



258



4


Wind

598



9



475



8


Total generation

5,190



79



4,564



74


Purchased power:








Term

1,000



15



1,208



20


Hydro

241



4



325



5


Wind

100



2



85



1


Total purchased power

1,341



21



1,618



26


Total system load

6,531



100

%


6,182



100

%

Less: wholesale sales

(2,015)





(1,529)




Retail load requirement

4,516





4,653




The following table indicates the number of heating and cooling degree-days for the three months ended September 30, 2019 and 2018, along with 15-year averages based on weather data provided by the National Weather Service, as measured at Portland International Airport:


Heating Degree-days


Cooling Degree-days


2019


2018


Avg.


2019


2018


Avg.

July

3



2



6



176



289



179


August



6



6



216



238



190


September

80



61



63



70



48



71


Totals for the quarter

83



69



75



462



575



440


Increase/(decrease) from the 15-year average

11

%


(8)

%




5

%


31

%



 

Cision View original content:http://www.prnewswire.com/news-releases/portland-general-electric-announces-third-quarter-2019-results-300949660.html

SOURCE Portland General Company