The document is the transcript from Duke Energy Corporation's Q4 2005 earnings conference call and outlook for 2006. It includes an introduction by Julie Dill, VP of Investor Relations. Paul Anderson, Chairman and CEO, provides an overview of Duke Energy's 2005 results and progress on the merger with Cinergy. Fred Fowler, President and COO, then reviews the outlook and earnings expectations for each of Duke Energy's business units for 2006.
This document contains the prepared remarks and Q&A from Duke Energy's third quarter 2005 earnings conference call on November 2, 2005. The call covered Duke Energy's financial results for the third quarter of 2005, including segment results for franchised electric, natural gas transmission, field services, international energy, and Crescent resources. It also provided updates on Duke Energy's plans to exit its DENA business and its proposed merger with Cinergy. Key executives discussed drivers of earnings growth or declines across business segments and provided earnings guidance for the remainder of 2005.
- Duke Energy held a conference call to discuss its Q4 2006 earnings. The call included the Chairman & CEO, CFO, and other executives.
- Q4 2006 ongoing diluted EPS was $0.43, flat compared to Q4 2005. Full year 2006 ongoing diluted EPS increased 5% to $1.81.
- Results were driven by additions from the Cinergy merger, partially offset by lower results at Crescent Resources.
- Going forward, Duke Energy expects ongoing EBIT of $200 million from its Commercial Power business in 2007. Regulated capital expenditures will primarily focus on the Carolinas and Indiana jurisdictions.
This document contains the prepared remarks and Q&A from Duke Energy Corporation's earnings conference call for the second quarter of 2006. Key points:
- Duke Energy reported ongoing EPS of $0.43 compared to consensus of $0.38.
- Financial results were impacted by mild weather, lower bulk power sales, and purchase accounting charges from the Cinergy merger.
- The company achieved several strategic objectives in the quarter including closing the Cinergy merger early and announcing the sale of the Commercial Marketing and Trading business.
- While some business units are performing ahead of plan, overall the company is on track to achieve its $1.90 EPS target for 2006.
This document summarizes Duke Energy's and Cinergy's first quarter 2006 earnings conference call. David Hauser, Duke Energy's CFO, discussed the financial results of both companies. For Duke Energy, earnings per share were $0.48, up from the prior year. Segment EBIT increased across most business units due to factors like customer and volume growth. For Cinergy, ongoing earnings per share were $0.62, up slightly from the prior year, while reported earnings were $0.39 due to merger costs. Hauser provided an overview of key financial metrics and outlook for both companies.
The document summarizes Spectra Energy's first quarter 2007 earnings call. It discusses positive first quarter results overall, with solid performance from the U.S. Transmission and Distribution segments. Field Services results were lower due to severe winter weather impacts. The call highlights several major capital projects underway, including doubling capacity on the Maritimes pipeline to connect to a new LNG terminal, and a new offshore pipeline project in Massachusetts Bay on track for a late 2007 in-service date.
Duke Energy held an earnings conference call to discuss its third quarter 2006 results. The call included prepared remarks from Jim Rogers, President and CEO, and David Hauser, CFO. Rogers noted results were below expectations due to weaker performance across most business segments compared to the prior year third quarter. Hauser provided more details on financial results, noting lower earnings in franchised electric and gas, natural gas transmission, international, and Crescent Resources segments. However, commercial power results improved due to the addition of Cinergy's nonregulated operations. Overall, Duke Energy expects to achieve its revised 2006 employee incentive target of $1.86 per share.
This document provides a transcript of Spectra Energy's fourth quarter 2007 earnings review call on February 6, 2008. In the call, Spectra Energy executives discuss the company's strong financial results for 2007, exceeding its earnings target. They also discuss Spectra Energy's investment in expansion projects and growth opportunities. The executives then provide details on the financial results and growth outlook for each of Spectra Energy's business segments. Overall, the transcript outlines Spectra Energy's positive financial performance in 2007 and growth strategy moving forward into 2008.
This transcript summarizes the Q1 2008 earnings call for Spectra Energy Corp. In the call, Fred Fowler, the President and CEO, and Greg Ebel, the CFO, discussed Spectra Energy's strong financial results for Q1 2008. They announced two value-enhancing initiatives - a plan to repurchase up to $600 million of Spectra Energy shares, and a recommendation to increase the quarterly dividend from $0.23 to $0.25 per share. Fowler and Ebel believe these moves will reward investors and illustrate the company's underlying value and earnings potential. They also discussed segment results, capital expansion plans, credit metrics, and an outlook for continued strong performance in 2008.
This document contains the prepared remarks and Q&A from Duke Energy's third quarter 2005 earnings conference call on November 2, 2005. The call covered Duke Energy's financial results for the third quarter of 2005, including segment results for franchised electric, natural gas transmission, field services, international energy, and Crescent resources. It also provided updates on Duke Energy's plans to exit its DENA business and its proposed merger with Cinergy. Key executives discussed drivers of earnings growth or declines across business segments and provided earnings guidance for the remainder of 2005.
- Duke Energy held a conference call to discuss its Q4 2006 earnings. The call included the Chairman & CEO, CFO, and other executives.
- Q4 2006 ongoing diluted EPS was $0.43, flat compared to Q4 2005. Full year 2006 ongoing diluted EPS increased 5% to $1.81.
- Results were driven by additions from the Cinergy merger, partially offset by lower results at Crescent Resources.
- Going forward, Duke Energy expects ongoing EBIT of $200 million from its Commercial Power business in 2007. Regulated capital expenditures will primarily focus on the Carolinas and Indiana jurisdictions.
This document contains the prepared remarks and Q&A from Duke Energy Corporation's earnings conference call for the second quarter of 2006. Key points:
- Duke Energy reported ongoing EPS of $0.43 compared to consensus of $0.38.
- Financial results were impacted by mild weather, lower bulk power sales, and purchase accounting charges from the Cinergy merger.
- The company achieved several strategic objectives in the quarter including closing the Cinergy merger early and announcing the sale of the Commercial Marketing and Trading business.
- While some business units are performing ahead of plan, overall the company is on track to achieve its $1.90 EPS target for 2006.
This document summarizes Duke Energy's and Cinergy's first quarter 2006 earnings conference call. David Hauser, Duke Energy's CFO, discussed the financial results of both companies. For Duke Energy, earnings per share were $0.48, up from the prior year. Segment EBIT increased across most business units due to factors like customer and volume growth. For Cinergy, ongoing earnings per share were $0.62, up slightly from the prior year, while reported earnings were $0.39 due to merger costs. Hauser provided an overview of key financial metrics and outlook for both companies.
The document summarizes Spectra Energy's first quarter 2007 earnings call. It discusses positive first quarter results overall, with solid performance from the U.S. Transmission and Distribution segments. Field Services results were lower due to severe winter weather impacts. The call highlights several major capital projects underway, including doubling capacity on the Maritimes pipeline to connect to a new LNG terminal, and a new offshore pipeline project in Massachusetts Bay on track for a late 2007 in-service date.
Duke Energy held an earnings conference call to discuss its third quarter 2006 results. The call included prepared remarks from Jim Rogers, President and CEO, and David Hauser, CFO. Rogers noted results were below expectations due to weaker performance across most business segments compared to the prior year third quarter. Hauser provided more details on financial results, noting lower earnings in franchised electric and gas, natural gas transmission, international, and Crescent Resources segments. However, commercial power results improved due to the addition of Cinergy's nonregulated operations. Overall, Duke Energy expects to achieve its revised 2006 employee incentive target of $1.86 per share.
This document provides a transcript of Spectra Energy's fourth quarter 2007 earnings review call on February 6, 2008. In the call, Spectra Energy executives discuss the company's strong financial results for 2007, exceeding its earnings target. They also discuss Spectra Energy's investment in expansion projects and growth opportunities. The executives then provide details on the financial results and growth outlook for each of Spectra Energy's business segments. Overall, the transcript outlines Spectra Energy's positive financial performance in 2007 and growth strategy moving forward into 2008.
This transcript summarizes the Q1 2008 earnings call for Spectra Energy Corp. In the call, Fred Fowler, the President and CEO, and Greg Ebel, the CFO, discussed Spectra Energy's strong financial results for Q1 2008. They announced two value-enhancing initiatives - a plan to repurchase up to $600 million of Spectra Energy shares, and a recommendation to increase the quarterly dividend from $0.23 to $0.25 per share. Fowler and Ebel believe these moves will reward investors and illustrate the company's underlying value and earnings potential. They also discussed segment results, capital expansion plans, credit metrics, and an outlook for continued strong performance in 2008.
The document reviews Duke Energy's 2005 financial results, provides an outlook for 2006 earnings per share of $1.90, and details expected 2006 capital expenditures of $4.325 billion as the company integrates Cinergy operations following their planned merger. Key assumptions for 2006 include normal weather, sales growth, and $140 million in annual merger savings beginning in mid-2006.
Spectra Energy reported strong financial results for the third quarter of 2008. The company's ongoing earnings per share increased 29% compared to the third quarter of 2007. All of Spectra Energy's business segments performed well due to solid execution of expansion projects and strong commodity prices. However, commodity prices have declined significantly recently. Spectra Energy is well positioned to manage through current market volatility due to its portfolio of smaller expansion projects, strong liquidity position, and consistent cash flows. The company remains on track to exceed its 2008 earnings target and is confident in its ability to continue delivering value to shareholders.
The document is Origin Energy's 2013 Annual Report. It provides an overview of Origin Energy's financial performance for the 2013 fiscal year, including a decrease in statutory profit to $378 million due to factors such as losses on financial instruments and increased retail transformation expenditures. Underlying profit decreased 15% to $760 million. Key highlights included sufficient liquidity to fund Australia Pacific LNG requirements, underlying business performance, and operating effectiveness improving in Energy Markets. The report discusses future prospects such as delivering the Australia Pacific LNG project on schedule and improving performance across existing businesses.
The document is a transcript of Spectra Energy's second quarter 2007 earnings conference call. In the call, company executives discuss Spectra Energy's financial results for the second quarter of 2007. They report that earnings were in line with expectations, but came from different sources than anticipated. The pipeline segment performed solidly, but Western Canada and Field Services earnings were lower than the previous year due to planned maintenance and severe weather. Executives provide details on financial results for each business segment and discuss progress on several major capital expansion projects.
05 08-17 first quarter 2017 financial review finalAES_BigSky
- The AES Corporation released its first quarter 2017 financial review, which contained forward-looking statements and non-GAAP financial measures with required reconciliations.
- Key highlights included progress on major construction projects, cost savings initiatives, and plans to reduce merchant coal exposure and carbon intensity.
- AES reaffirmed its 2017 guidance targets and average annual 8-10% growth rate through 2020.
The document summarizes an annual general meeting for FOY Group Limited held on November 30, 2015. It discusses FOY's acquisition of the Berkeley Vale Plastics to Fuel plant and 3 innovative technologies, as well as its ongoing commitment to existing projects in PNG. The Chairman and Managing Director provide addresses on Berkeley Vale progress, PNG progress, and FOY's strategic growth plan to leverage its depolymerization technology internationally through partnerships and joint ventures. An indicative timetable for FOY's relisting on the ASX is also presented.
DTE Energy announced its first quarter 2007 earnings. Reported earnings were $134 million compared to $136 million in the first quarter of 2006. Operating earnings, which exclude non-recurring items, were $149 million compared to $171 million in the prior year. The primary drivers of the decline were a temporary rate reduction at Detroit Edison and increased costs from a January ice storm. DTE Energy maintained its 2007 earnings guidance and cash flow from operations increased 8% from the prior year.
This transcript summarizes a Duke Energy earnings call for the third quarter of 2007:
[1] Duke Energy reported ongoing diluted EPS of $0.48 for Q3 2007, an improvement over $0.29 for the same period last year, driven by higher EBIT from its major business segments.
[2] The US Franchised Electric and Gas segment saw an $82 million increase in EBIT year-over-year due to favorable weather, rate reductions ending, and higher wholesale volumes, partially offset by higher costs.
[3] Commercial Power reported higher EBIT of $121 million compared to $57 million last year, from improved margins and Midwest gas plant performance.
[4
Duke Energy 02/02/05_prepared_remarks_and_qafinance21
This document provides a summary of Duke Energy Corporation's Q4 2004 earnings conference call. Key points include:
- Duke Energy reported 2004 EPS of $1.59, including special items, and ongoing EPS of $1.38, exceeding its $1.20 target.
- Business units like Field Services and Crescent Resources had strong years. Field Services benefited from higher commodity prices.
- For Q4 2004, Duke Energy reported EPS of $0.38 including special items. Ongoing segment EBIT increased at Franchised Electric and Natural Gas Transmission.
- Guidance for 2005 includes a $150M loss for DENA and $350-500M EBIT for Field Services depending
The AES Corporation released its first quarter 2017 financial review. Some key points include:
- AES is on track to achieve its $400 million cost reduction and revenue enhancement program by 2020.
- AES is advancing its construction program which will contribute significantly to earnings and cash flow growth through 2021.
- AES is reshaping its portfolio to reduce risk by exiting 3.7GW of merchant coal assets in Kazakhstan and Ohio.
- AES is well positioned for future growth through projects under construction, acquisitions like sPower, and an $8-10 billion renewable development pipeline.
- AES expects average annual earnings and cash flow growth of 8-10% through 2020.
Cinergy Corp. reported second quarter 2005 earnings of $51 million, or $0.25 per share, compared to $59 million, or $0.32 per share in the second quarter of 2004. Earnings were negatively impacted by $0.04 per share from mark-to-market losses on hedging contracts and $0.07 per share for merger-related costs. Excluding these impacts, adjusted earnings were $0.36 per share. Cinergy also announced it was lowering its 2005 earnings guidance to $2.50 to $2.65 per share due to weaker-than-expected performance from its commercial gas operations.
08 08-17 second quarter 2017 financial review finalAES_BigSky
- The AES Corporation released its Second Quarter 2017 Financial Review, which contained forward-looking statements and non-GAAP financial measures.
- Key highlights included adjusted EPS increasing $0.08 to $0.25 driven by higher availability in MCAC and Argentina, and reaffirming 2017 guidance and expectations through 2020.
- Projects totaling 4,659 MW are under construction and expected to come online through 2020, and AES acquired or has agreements for 1.8 GW of wind and solar to be added through 2020.
Spectra Energy reported strong financial results for the fourth quarter and full year of 2007. Fourth quarter net income was $291 million, up 14% from the prior year, and full year net income was $957 million. The company exceeded its earnings per share target for employees of $1.40 by earning $1.51 per share. All of the company's business segments experienced increased earnings compared to the previous year. Spectra Energy also invested $1 billion in growth projects that will fuel future revenue and earnings increases. Management is confident that the company's momentum will continue into 2008.
DTE Energy announced its third quarter 2007 earnings. Operating earnings were $181 million compared to $255 million in third quarter 2006, primarily due to one-time gains in 2006 and startup costs for new systems in 2007. For the first nine months, operating earnings were $317 million compared to $377 million in 2006, mainly due to onetime costs at Detroit Edison including new system startup. The company expects to meet its annual operating earnings guidance and sees underlying business performing well despite some one-time items.
This document provides an overview and agenda for EnLink Midstream's 2014 Analyst & Investor Day. It begins with forward-looking statements and disclosures about non-GAAP financial measures used. The agenda then outlines the presentations that will be made on the company's roadmap for growth, natural gas and liquids businesses, financial outlook, and non-operated investments. Background is given on EnLink Midstream's MLP structure and relationship with sponsor Devon Energy, as well as the experience of the management team. Key aspects of the company's growth strategy are its fee-based contracts, strategic assets, and investment grade balance sheet to fund expansion.
Duke Energy reported third quarter 2006 results, with ongoing diluted EPS of 48 cents, down from 56 cents in the prior year's quarter. Reported diluted EPS was 60 cents, up from 4 cents in 2005. The company remains on track to meet its 2006 ongoing EPS target after adjusting for the sale of its Commercial Marketing and Trading business. During the quarter, Duke Energy created a joint venture for its Crescent Resources business, yielding $1.4 billion in after-tax cash proceeds. Business unit results were mixed compared to the prior year, with the Franchised Electric & Gas unit up but other units such as Natural Gas Transmission down due to various factors including costs and weather.
Aes barclays ceo energy-power conference finalAES_BigSky
This document provides an overview of The AES Corporation and its business strategy and outlook. Some key points:
- AES operates in several strategic business units globally, with the largest portions of its business in the US, Andes region, and Mexico/Central America/Caribbean.
- It has a portfolio of long-term contracted generation assets that is approximately 80% US dollar denominated.
- AES has several large construction projects underway that will come online between 2018-2020, increasing its contracted portfolio.
- The company aims to strengthen its balance sheet, grow key metrics like free cash flow by 8-10% annually through 2020, and reshape its business mix toward gas and renewables.
- Seplat reported Q4 and full year 2014 results in line with expectations, with revenues of $775 million.
- The analyst has lowered their target price for Seplat shares from N771 to N756 due to higher operational risks on the Trans Forcados Pipeline and a slightly lower production forecast.
- Production guidance for 2015 is 32-36 thousand barrels of oil equivalent per day, with the startup of a new gas facility expected to increase gas volumes.
DTE Energy reported strong third quarter 2006 earnings of $188 million compared to $4 million in third quarter 2005. Operating earnings, which exclude non-recurring items, were $255 million in third quarter 2006 compared to $5 million in third quarter 2005. All of DTE Energy's business segments experienced increased operating earnings except for Gas Utility which typically has a seasonal loss in the third quarter. DTE Energy tightened its full year 2006 operating earnings guidance excluding synthetic fuels to be between $2.42 to $2.53 per share.
Duke Energy reported higher ongoing diluted EPS of $0.43 per share compared to $0.32 in the prior year's quarter. Revenues were lower at $4.04 billion compared to $5.27 billion due to the deconsolidation of DEFS, but this was partially offset by the addition of Cinergy's operations. Strong performances from Gas Transmission, Field Services and Crescent helped deliver solid results, and the company remains on track to achieve its 2006 EPS target.
duke energy 2Q/07_Earnings_Call_Transcript_-_Finalfinance21
This transcript summarizes a Duke Energy earnings call for the second quarter of 2007:
1) Duke Energy reported ongoing diluted earnings per share of $0.25 for Q2 2007, up from $0.24 in Q2 2006, driven by improved results across its major business segments.
2) The U.S. Franchised Electric and Gas segment saw higher earnings due to favorable weather and increased wholesale volumes, partially offset by higher costs and rate reductions.
3) Duke Energy is on track to exceed its 2007 employee earnings target of $1.15 per share and expects Q3 to be its strongest quarter due to seasonal factors.
The document reviews Duke Energy's 2005 financial results, provides an outlook for 2006 earnings per share of $1.90, and details expected 2006 capital expenditures of $4.325 billion as the company integrates Cinergy operations following their planned merger. Key assumptions for 2006 include normal weather, sales growth, and $140 million in annual merger savings beginning in mid-2006.
Spectra Energy reported strong financial results for the third quarter of 2008. The company's ongoing earnings per share increased 29% compared to the third quarter of 2007. All of Spectra Energy's business segments performed well due to solid execution of expansion projects and strong commodity prices. However, commodity prices have declined significantly recently. Spectra Energy is well positioned to manage through current market volatility due to its portfolio of smaller expansion projects, strong liquidity position, and consistent cash flows. The company remains on track to exceed its 2008 earnings target and is confident in its ability to continue delivering value to shareholders.
The document is Origin Energy's 2013 Annual Report. It provides an overview of Origin Energy's financial performance for the 2013 fiscal year, including a decrease in statutory profit to $378 million due to factors such as losses on financial instruments and increased retail transformation expenditures. Underlying profit decreased 15% to $760 million. Key highlights included sufficient liquidity to fund Australia Pacific LNG requirements, underlying business performance, and operating effectiveness improving in Energy Markets. The report discusses future prospects such as delivering the Australia Pacific LNG project on schedule and improving performance across existing businesses.
The document is a transcript of Spectra Energy's second quarter 2007 earnings conference call. In the call, company executives discuss Spectra Energy's financial results for the second quarter of 2007. They report that earnings were in line with expectations, but came from different sources than anticipated. The pipeline segment performed solidly, but Western Canada and Field Services earnings were lower than the previous year due to planned maintenance and severe weather. Executives provide details on financial results for each business segment and discuss progress on several major capital expansion projects.
05 08-17 first quarter 2017 financial review finalAES_BigSky
- The AES Corporation released its first quarter 2017 financial review, which contained forward-looking statements and non-GAAP financial measures with required reconciliations.
- Key highlights included progress on major construction projects, cost savings initiatives, and plans to reduce merchant coal exposure and carbon intensity.
- AES reaffirmed its 2017 guidance targets and average annual 8-10% growth rate through 2020.
The document summarizes an annual general meeting for FOY Group Limited held on November 30, 2015. It discusses FOY's acquisition of the Berkeley Vale Plastics to Fuel plant and 3 innovative technologies, as well as its ongoing commitment to existing projects in PNG. The Chairman and Managing Director provide addresses on Berkeley Vale progress, PNG progress, and FOY's strategic growth plan to leverage its depolymerization technology internationally through partnerships and joint ventures. An indicative timetable for FOY's relisting on the ASX is also presented.
DTE Energy announced its first quarter 2007 earnings. Reported earnings were $134 million compared to $136 million in the first quarter of 2006. Operating earnings, which exclude non-recurring items, were $149 million compared to $171 million in the prior year. The primary drivers of the decline were a temporary rate reduction at Detroit Edison and increased costs from a January ice storm. DTE Energy maintained its 2007 earnings guidance and cash flow from operations increased 8% from the prior year.
This transcript summarizes a Duke Energy earnings call for the third quarter of 2007:
[1] Duke Energy reported ongoing diluted EPS of $0.48 for Q3 2007, an improvement over $0.29 for the same period last year, driven by higher EBIT from its major business segments.
[2] The US Franchised Electric and Gas segment saw an $82 million increase in EBIT year-over-year due to favorable weather, rate reductions ending, and higher wholesale volumes, partially offset by higher costs.
[3] Commercial Power reported higher EBIT of $121 million compared to $57 million last year, from improved margins and Midwest gas plant performance.
[4
Duke Energy 02/02/05_prepared_remarks_and_qafinance21
This document provides a summary of Duke Energy Corporation's Q4 2004 earnings conference call. Key points include:
- Duke Energy reported 2004 EPS of $1.59, including special items, and ongoing EPS of $1.38, exceeding its $1.20 target.
- Business units like Field Services and Crescent Resources had strong years. Field Services benefited from higher commodity prices.
- For Q4 2004, Duke Energy reported EPS of $0.38 including special items. Ongoing segment EBIT increased at Franchised Electric and Natural Gas Transmission.
- Guidance for 2005 includes a $150M loss for DENA and $350-500M EBIT for Field Services depending
The AES Corporation released its first quarter 2017 financial review. Some key points include:
- AES is on track to achieve its $400 million cost reduction and revenue enhancement program by 2020.
- AES is advancing its construction program which will contribute significantly to earnings and cash flow growth through 2021.
- AES is reshaping its portfolio to reduce risk by exiting 3.7GW of merchant coal assets in Kazakhstan and Ohio.
- AES is well positioned for future growth through projects under construction, acquisitions like sPower, and an $8-10 billion renewable development pipeline.
- AES expects average annual earnings and cash flow growth of 8-10% through 2020.
Cinergy Corp. reported second quarter 2005 earnings of $51 million, or $0.25 per share, compared to $59 million, or $0.32 per share in the second quarter of 2004. Earnings were negatively impacted by $0.04 per share from mark-to-market losses on hedging contracts and $0.07 per share for merger-related costs. Excluding these impacts, adjusted earnings were $0.36 per share. Cinergy also announced it was lowering its 2005 earnings guidance to $2.50 to $2.65 per share due to weaker-than-expected performance from its commercial gas operations.
08 08-17 second quarter 2017 financial review finalAES_BigSky
- The AES Corporation released its Second Quarter 2017 Financial Review, which contained forward-looking statements and non-GAAP financial measures.
- Key highlights included adjusted EPS increasing $0.08 to $0.25 driven by higher availability in MCAC and Argentina, and reaffirming 2017 guidance and expectations through 2020.
- Projects totaling 4,659 MW are under construction and expected to come online through 2020, and AES acquired or has agreements for 1.8 GW of wind and solar to be added through 2020.
Spectra Energy reported strong financial results for the fourth quarter and full year of 2007. Fourth quarter net income was $291 million, up 14% from the prior year, and full year net income was $957 million. The company exceeded its earnings per share target for employees of $1.40 by earning $1.51 per share. All of the company's business segments experienced increased earnings compared to the previous year. Spectra Energy also invested $1 billion in growth projects that will fuel future revenue and earnings increases. Management is confident that the company's momentum will continue into 2008.
DTE Energy announced its third quarter 2007 earnings. Operating earnings were $181 million compared to $255 million in third quarter 2006, primarily due to one-time gains in 2006 and startup costs for new systems in 2007. For the first nine months, operating earnings were $317 million compared to $377 million in 2006, mainly due to onetime costs at Detroit Edison including new system startup. The company expects to meet its annual operating earnings guidance and sees underlying business performing well despite some one-time items.
This document provides an overview and agenda for EnLink Midstream's 2014 Analyst & Investor Day. It begins with forward-looking statements and disclosures about non-GAAP financial measures used. The agenda then outlines the presentations that will be made on the company's roadmap for growth, natural gas and liquids businesses, financial outlook, and non-operated investments. Background is given on EnLink Midstream's MLP structure and relationship with sponsor Devon Energy, as well as the experience of the management team. Key aspects of the company's growth strategy are its fee-based contracts, strategic assets, and investment grade balance sheet to fund expansion.
Duke Energy reported third quarter 2006 results, with ongoing diluted EPS of 48 cents, down from 56 cents in the prior year's quarter. Reported diluted EPS was 60 cents, up from 4 cents in 2005. The company remains on track to meet its 2006 ongoing EPS target after adjusting for the sale of its Commercial Marketing and Trading business. During the quarter, Duke Energy created a joint venture for its Crescent Resources business, yielding $1.4 billion in after-tax cash proceeds. Business unit results were mixed compared to the prior year, with the Franchised Electric & Gas unit up but other units such as Natural Gas Transmission down due to various factors including costs and weather.
Aes barclays ceo energy-power conference finalAES_BigSky
This document provides an overview of The AES Corporation and its business strategy and outlook. Some key points:
- AES operates in several strategic business units globally, with the largest portions of its business in the US, Andes region, and Mexico/Central America/Caribbean.
- It has a portfolio of long-term contracted generation assets that is approximately 80% US dollar denominated.
- AES has several large construction projects underway that will come online between 2018-2020, increasing its contracted portfolio.
- The company aims to strengthen its balance sheet, grow key metrics like free cash flow by 8-10% annually through 2020, and reshape its business mix toward gas and renewables.
- Seplat reported Q4 and full year 2014 results in line with expectations, with revenues of $775 million.
- The analyst has lowered their target price for Seplat shares from N771 to N756 due to higher operational risks on the Trans Forcados Pipeline and a slightly lower production forecast.
- Production guidance for 2015 is 32-36 thousand barrels of oil equivalent per day, with the startup of a new gas facility expected to increase gas volumes.
DTE Energy reported strong third quarter 2006 earnings of $188 million compared to $4 million in third quarter 2005. Operating earnings, which exclude non-recurring items, were $255 million in third quarter 2006 compared to $5 million in third quarter 2005. All of DTE Energy's business segments experienced increased operating earnings except for Gas Utility which typically has a seasonal loss in the third quarter. DTE Energy tightened its full year 2006 operating earnings guidance excluding synthetic fuels to be between $2.42 to $2.53 per share.
Duke Energy reported higher ongoing diluted EPS of $0.43 per share compared to $0.32 in the prior year's quarter. Revenues were lower at $4.04 billion compared to $5.27 billion due to the deconsolidation of DEFS, but this was partially offset by the addition of Cinergy's operations. Strong performances from Gas Transmission, Field Services and Crescent helped deliver solid results, and the company remains on track to achieve its 2006 EPS target.
duke energy 2Q/07_Earnings_Call_Transcript_-_Finalfinance21
This transcript summarizes a Duke Energy earnings call for the second quarter of 2007:
1) Duke Energy reported ongoing diluted earnings per share of $0.25 for Q2 2007, up from $0.24 in Q2 2006, driven by improved results across its major business segments.
2) The U.S. Franchised Electric and Gas segment saw higher earnings due to favorable weather and increased wholesale volumes, partially offset by higher costs and rate reductions.
3) Duke Energy is on track to exceed its 2007 employee earnings target of $1.15 per share and expects Q3 to be its strongest quarter due to seasonal factors.
The document discusses Duke Energy Corporation's use of non-GAAP financial measures in its First Quarter 2007 Earnings Review presentation. Specifically, it discusses measures such as ongoing diluted EPS, ongoing segment EBIT, and expected ongoing diluted EPS growth rates which exclude special items that management believes are not recurring. It provides reconciliations of these non-GAAP measures to the most directly comparable GAAP measures for previous periods to facilitate understanding of the non-GAAP information.
This document summarizes Duke Energy's third quarter 2006 earnings review. It reports that ongoing earnings per share were $0.48, lower than the previous year but that the company remains on track to achieve its revised earnings target. Several business segments saw lower results due to factors like higher costs and weather. However, the addition of Cinergy's utilities contributed positively. The document also discusses Duke Energy's commitments to investors including growing earnings, achieving full portfolio value, and transparent communication.
This document contains the prepared remarks from Duke Energy's Q1 2004 earnings conference call. The key points are:
1) Duke Energy reported earnings of 36 cents per share including special items, and ongoing earnings of 32 cents, which met expectations despite $6 cents of MTM losses during the quarter.
2) Several business segments performed well, including franchised electric and gas transmission. Field services benefited from higher frac spreads and hedging gains.
3) Challenges included a disappointing quarter for DENA due to inability to capture optionality. However, DENA expects to realize its full-year budget.
4) Duke Energy continues reducing debt and increasing cash, made progress on legal issues,
The document is the transcript of Duke Energy's Q1 2003 earnings conference call.
In the call, Duke Energy executives discuss the company's financial results and progress on its strategic plan. They report that regulated utilities Franchised Electric and Gas Transmission contributed 94% of earnings. Duke is reducing costs, selling $1.1 billion in assets, and focusing on its strongest businesses. While merchant energy faced challenges, Duke is restructuring to improve results going forward.
Duke Energy reported third quarter earnings per share of $0.41, which included $0.03 from special items primarily related to additional tax benefits from asset sales. Ongoing earnings were $0.38 per share. Key business segments like Franchised Electric and Natural Gas Transmission reported solid results. Field Services benefited from strong natural gas liquid prices. Duke Energy North America continued working to reduce losses from its merchant energy business. The company has reduced its debt by $2.4 billion year-to-date through asset sales and cash flows. Management expects to meet or exceed its financial goals for 2004 and continues working to improve the company's performance.
Duke Energy held its Q2 2003 earnings conference call on July 30, 2003. Fred Fowler, President and COO, reported that Duke Energy has made strong progress in the first half of 2003 through an asset sales program that generated over $1.5 billion, reducing capital spending to $3 billion, and lowering net debt by approximately $1.8 billion for the year. Duke Energy reported Q2 earnings of 46 cents per share including 16 cents from asset sales. For the first half of 2003, Duke Energy reported earnings of 71 cents per share including gains from asset sales and an accounting charge, with benefits from Westcoast earnings and expansion projects offset by lower DENA earnings and higher interest expenses.
This document contains the prepared remarks and Q&A from Duke Energy Corporation's earnings conference call for Q2 2004.
The key points are:
1) Duke Energy reported earnings per share of $0.46 for Q2 2004, which included $0.04 per share in special items. Ongoing earnings were $0.42 per share.
2) The company's largest business segments - Franchised Electric and Gas Transmission - generated solid earnings and cash flows for the quarter. Field Services also had strong results due to high natural gas liquid prices and operating improvements.
3) Duke Energy reduced its mark-to-market trading position, but results were still affected by changing commodity prices
Duke Energy held a conference call to discuss its second quarter 2005 earnings. The call included prepared remarks from Chairman and CEO Paul Anderson and Group VP and CFO David Hauser. Key highlights from their remarks include:
- Earnings per share were $0.33, including $0.02 in special items, compared to analyst expectations of $0.38. However, the company was on plan for the year.
- Weather had a negative $0.05 impact on earnings compared to last year. Results were also impacted by higher O&M costs.
- Most business units performed well, though Franchised Electric and DENA saw declines due to weather and other factors.
- The proposed merger with C
Duke Energy held an earnings conference call to discuss its first quarter 2005 results. The call included prepared remarks from Duke Energy's Chairman and CEO, Group VP and CFO, and President and COO. They reported earnings of $0.91 per share including special items, and ongoing earnings of $0.44 per share, up nearly 30% from the prior year. Business unit highlights included strong results from Field Services, International Energy, and Crescent Resources. DENA reported a smaller loss than the prior year. The executives provided an outlook for the remainder of 2005 and discussed the impact of recent transactions involving Duke Energy's ownership in Field Services.
Duke Energy 4Q/03_Transcript_and_QA_-Finalfinance21
Duke Energy held an earnings call to discuss its financial results for Q4 2003 and the full year. The company reported a net loss of $1.48 per share for 2003, which included $2.76 in special items. Most business segments met their targets except for Franchised Electric, which saw lower earnings due to higher costs. Duke Energy's largest loss was primarily driven by asset impairments and other special charges related to its DENA business. Management provided additional details on special items to help analysts understand the company's ongoing earnings performance excluding these one-time charges.
This document contains the prepared remarks and Q&A from Duke Energy's third quarter 2003 earnings conference call on October 30, 2003. Rick Priory, then-CEO of Duke Energy, noted that third quarter results were below expectations due to challenges faced by the DENA business segment. Duke Energy reported GAAP earnings of $0.05 per share and ongoing earnings of $0.35 per share for the quarter, excluding special items. Priory discussed cost reduction efforts that would yield over $200 million in annual pre-tax savings. CFO Robert Brace provided additional details on segment results and $0.30 per share in special items recorded in the quarter.
This presentation provides an overview of National Automation Services (NAS) and argues that its stock is undervalued relative to peers. NAS acquires and operates oilfield services companies, with its first acquisition being JD Field Services in 2014. The presentation discusses NAS's business strategy, JD's financial results and customer base, projections for NAS's growth in revenues, earnings, and share price through 2015-2016 both with and without further acquisitions. Management backgrounds are presented to demonstrate their experience in oilfield services, finance, and mergers and acquisitions.
Kodak reported its first quarter 2006 earnings. The company faced higher than normal inventory in its consumer digital business due to fourth quarter price reductions. Its graphic communications business performed better than expected. Film and photofinishing revenue declined as expected but earnings were slightly better than planned.
Kodak also announced it would pursue strategic alternatives for its health business and restructure its global manufacturing and logistics operations. It will reduce corporate costs by retiring three senior officers and realigning organizational entities to further its transformation to a digital company.
The document is a transcript from Duke Energy's first quarter 2007 earnings conference call.
- Duke Energy reported first quarter 2007 ongoing diluted EPS of $0.30, up from $0.21 in the prior year quarter. Results exceeded internal plans.
- Key drivers included the addition of Cinergy's regulated Midwest assets, improved results at Duke Energy International, and continued strong performance from core regulated businesses.
- Segment results were positively impacted by customer growth, favorable weather, a DOE settlement, and synergies from the Cinergy merger, partially offset by rate reductions related to merger approval requirements.
This document summarizes Spectra Energy's second quarter 2008 earnings review call. The call discusses Spectra Energy's strong financial results for the second quarter of 2008, with earnings per share of $0.47, exceeding expectations. The company also discussed its value enhancement program, including share repurchases and capital expansion projects. Leadership expressed confidence in the company's business plan and outlook. The document provides an overview of the business segments' financial performance and discusses opportunities from emerging shale gas plays in North America.
CONSOL Energy & Noble Energy Marcellus Shale Joint Venture SeparationMarcellus Drilling News
Presentation used during a conference call to announced that CONSOL Energy and Noble Energy's 669,000-acre joint venture in the Marcellus Shale is ending. CONSOL will retain rights to 306,000 acres (mostly in Pennsylvania) and Noble rights to 363,000 acres (mostly in West Virginia). The separation will allow CONSOL to do more Utica drilling. Noble plans to do less drilling, for now, in the Marcellus.
The document summarizes the Q4 2012 earnings call of Calgon Carbon Corporation. In the call, the CEO Randy Dearth discusses the company's solid financial performance for Q4 2012, generating $0.16 in earnings per share. He highlights progress made in reducing costs and future initiatives. The CFO Steve Schott then reviews the financial performance, noting total sales increased 2.6% to $141.8 million compared to Q4 2011, with higher activated carbon and service segment sales offsetting lower equipment segment sales.
Gannett Co., Inc. held a conference call to discuss its fourth quarter and full year 2005 earnings. Gracia Martore, the CFO, noted that fourth quarter earnings were at the high end of guidance. Full year earnings per share were up slightly compared to 2004. Martore discussed factors impacting results such as the consolidation of Detroit Newspapers and currency exchange rates. Craig Dubow, President and CEO, provided details on segment results, noting growth in classified and real estate advertising, while auto remained soft. Online revenues increased nearly 60% for the quarter. The company is optimistic about opportunities in 2006.
spectra energy Q307EarningsCall_110607_transcriptfinance49
Spectra Energy's Third-Quarter 2007 Earnings Review Conference Call Transcript:
[1] Spectra Energy reported strong third quarter 2007 results with net income up 32% from the prior year. [2] The company is on track to meet its 2007 financial targets and capital expansion goals. [3] Spectra Energy discussed strong performance across its business segments and an outlook for continued growth driven by expansion projects coming online in 2008.
Cliffs Natural Resources Inc. provided forward-looking statements and important additional information in its February 2014 presentation. The document contained uncertainties that could cause actual results to differ from projections. It also noted risks that could impact future performance such as volatility in iron ore and coal prices, weaknesses in global economic conditions, and regulatory changes. The presentation introduced Gary Halverson as the new President and CEO of Cliffs and highlighted steps the new leadership has taken to reset strategy and impose financial discipline.
spectra energy EAF6B568-4BA4-4E99-A365-E9EF8C17DBA5_Transcript020509finance49
The document provides an overview of Spectra Energy's 4th quarter 2008 earnings call where they discussed their financial results for 2008 and outlook for 2009. Key points included earnings per share of $1.83 for 2008, exceeding targets. They placed $1.8 billion of capital projects into service for 2008. Their 2009 guidance is for earnings per share of $1.15 based on assumptions around commodity prices and exchange rates. Capital expenditures will be reduced to around $500 million for 2009 in light of economic conditions. The dividend will remain at $1.00 per share and they discussed ongoing growth opportunities across their assets.
Chesapeake Energy Corporation announced its 2014 capital expenditure budget and production outlook. It plans to decrease capital expenditures by 20% to $5.2-$5.6 billion while growing production by 2-4% through increased capital efficiency. It expects to reduce per-unit production and G&A expenses by 10% and 25% respectively. The company will focus capital in key plays like the Eagle Ford, Utica and Marcellus, while maintaining disciplined spending to deliver long-term production and shareholder return targets.
ConAgra Foods is selling its chicken business to focus on branded and value-added food items. The sale includes chicken processing operations and will generate cash for ConAgra to reinvest. ConAgra will receive Class A shares in Pilgrim's Pride, the chicken company acquiring its business, representing 7% of voting shares and 49% of equity. It can sell up to 1/3 of these shares annually but expects to reduce ownership over time based on market conditions. ConAgra will also receive notes from Pilgrim's Pride due in 2011 with a 10.5% interest rate to be paid semi-annually.
This document summarizes the Q1 FY2004 earnings results of a large packaged foods company. Key points include:
- Q1 EPS was $0.37 compared to $0.43 in Q1 FY2003, impacted by various one-time gains and losses.
- Packaged foods sales were down $168M excluding divested businesses, with a 5% volume decline.
- Several major brands saw growth, while others like Butterball declined.
- Corporate expenses increased due to litigation expenses from a past joint venture.
- The effective tax rate for FY2004 is estimated at 38%.
ConAgra Foods is selling its United Agri Products business to focus on branded and value-added products, as part of a broader strategy of divesting non-core businesses over the past year including fresh beef/pork, canned seafood, and cheese operations. The sale is expected to close by December 31, 2003 for cash and $60-75 million in preferred stock. ConAgra will retain some international UAP operations generating $250 million in annual sales, concentrated in several countries. Proceeds will be used for debt paydown and general corporate purposes including acquisitions and stock buybacks.
ConAgra Foods divested its poultry business to focus on branded, value-added foods with strong margins and growth. The $300 million cash and 25 million Pilgrim's Pride shares valued at $245 million totaled less than the poultry business' estimated $545 million book value due to the shares being valued based on past prices, not current prices. ConAgra Foods can sell up to 1/3 of the shares each year and account for shares eligible for resale within a year as securities, and other shares using cost accounting. The poultry business was previously reported in Meat Processing but is now in Discontinued Operations.
ConAgra Foods completed the divestiture of its chicken processing and crop inputs businesses, finalizing its strategy to focus on branded, value-added food opportunities. The company received $300 million in cash and 25 million shares of Pilgrim's Pride stock worth $245 million for the chicken business. ConAgra can sell up to 1/3 of the Pilgrim's Pride shares per year and will account for the shares as securities held for resale within one year or using the cost method if the eligibility for resale is over one year away. The chicken business was previously reported as part of ConAgra's Meat Processing segment but is now in Discontinued Operations.
ConAgra Foods has divested several commodity businesses and acquired branded and value-added food products to focus on higher margin businesses. The company is planning a share repurchase program using cash from strong operating cash flows and recent divestitures. ConAgra expects to continue investing in growth through acquisitions and paying down debt while deploying cash to dividends, debt repayment, and share repurchases as appropriate.
The document provides a Q&A summary of ConAgra Foods' financial results for Q2 FY04 compared to Q2 FY03. Key points include:
- Q2 FY04 diluted EPS was $0.51 compared to $0.44 in Q2 FY03, impacted by $0.04 in discontinued operations in FY04 and $0.03 in divestiture expenses in FY03.
- Sales comparability was impacted by $506M in divested fresh meat businesses in FY03 and $154M in divested canned food businesses in FY03.
- Examples of brand sales growth included Banquet, Chef Boyardee, Egg Beaters
Packaged Foods sales increased 4% excluding divestitures, with 2% volume growth. Several brands posted sales growth including Armour, Banquet, and Blue Bonnet, while others like ACT II and Butterball declined. Sales comparability was affected by $155 million in divested businesses last year. Operating profit grew 5% in Packaged Foods and 10% overall when adjusting for divested businesses and cost savings initiatives. The company is implementing cost cutting measures expected to save more than implementation costs in the future.
The document provides the quarterly and annual financial results for a company. Some key highlights include:
- Several consumer brands posted sales growth for the quarter including Banquet, Blue Bonnet, and Chef Boyardee, while others like ACT II and Eckrich saw declines.
- Total depreciation and amortization was around $93 million for the quarter and $352 million for the fiscal year.
- Capital expenditures were around $106 million for the quarter and $352 million for the fiscal year.
- Net interest expense was $80 million for the quarter and $275 million for the fiscal year.
- Corporate expenses were around $95 million for the quarter and $342 million
- Major brands in the Retail Products segment that posted sales growth included ACT II, Armour, Banquet, and Blue Bonnet. Brands that posted sales declines included Healthy Choice, Slim Jim, and Snack Pack.
- Retail volume increased 8% while foodservice volume was flat excluding divested businesses.
- Increased input costs negatively impacted operating profits in the Retail Products segment by approximately $45 million.
- Capital expenditures were approximately $105 million, reflecting increased investment in information systems.
This document contains the questions and answers from ConAgra Foods' Q2 FY2005 earnings call. Some key details include:
- Several major brands in the Retail Products segment posted sales growth, while others saw declines.
- Retail volume increased 7% and Foodservice volume decreased 1% excluding divested businesses.
- Capital expenditures increased significantly year-over-year due to investments in information systems.
- The company received proceeds from the sale of its minority interest in Swift Foods and shares of Pilgrim's Pride stock.
This document summarizes the Q3 2005 earnings results of a major food company. Some key highlights include: 1) Major brands in the Retail Products segment saw mixed sales results, with growth for brands like Chef Boyardee but declines for brands like Butterball. 2) Unit volumes declined 3% for Retail Products but increased 4% for Foodservice Products. 3) The packaged meats operations were slightly profitable but profits were over $45 million lower than the previous year. The company expects some improvement but not year-over-year profit gains for packaged meats in Q4.
This document summarizes ConAgra Foods' earnings results for fiscal year 2005 (FY05) in a question and answer format. Some key details include:
- FY05 diluted EPS was $1.23, including $0.12 in expenses that impacted comparability.
- Major brands in the Retail Products segment that saw sales growth included ACT II, Banquet, and Blue Bonnet. Brands that saw declines included Armour and Butterball.
- Retail Products volume increased 2% while Foodservice Products volume decreased 2% in Q4.
- Total depreciation and amortization was approximately $351 million for FY05 and $90 million for Q4. Capital expenditures
The document provides the questions and answers from the Q1 FY06 earnings call for ConAgra Foods. Some key details from the summary include:
- Sales grew for major brands like Butterball but declined for brands like ACT II. Retail Products volume declined 3% while Foodservice increased 4%.
- Depreciation and amortization was $89 million. Capital expenditures were $71 million and net interest expense was $68 million. Corporate expense was $73 million.
- Gross margin was 21.6% and operating margin was 10.9%. The effective tax rate for FY06 is estimated to be 36%.
Major brands in the Retail Products segment that posted sales growth included ACT II, Blue Bonnet, Butterball, Kid Cuisine, Marie Callender's, Reddi-wip and Ro*Tel. Brands that posted sales declines included Armour, Banquet, Cook's, DAVID, Eckrich, Egg Beaters, Healthy Choice, Hebrew National, Hunt's, LaChoy, Orville Redenbacher, PAM, Parkay, Peter Pan, Slim Jim, Snack Pack, Swiss Miss, Van Camp's and Wesson. Retail Products volume declined 5% for the quarter while Foodservice Products volume increased 2%. Corporate expense for the quarter was approximately $103 million
The document provides financial information from ConAgra Foods' Q3 FY06 quarterly earnings call. Some key details include:
- Retail segment sales grew 4% and Foodservice grew 1% over the prior year. Several major brands posted sales growth while others declined.
- Gross margin was 24.8% and operating margin was 12.5% for the quarter.
- Net debt was $3.6 billion, down from $4.5 billion a year prior due to debt repayment of $500 million during the quarter.
- Capital expenditures for the quarter and fiscal year-to-date were below prior year levels. Projected fiscal year expenditures are up to $400
- Major brands in the Consumer Foods segment that posted sales growth in Q4 FY06 included Blue Bonnet, Chef Boyardee, DAVID, Egg Beaters, Hebrew National, and Hunt's. Brands that posted sales declines included ACT II, Banquet, Healthy Choice, Peter Pan, Slim Jim, Snack Pack, and Van Camp's.
- Consumer Foods volume declined 2% in Q4 while Food and Ingredients volume increased 1%.
- Total depreciation and amortization for Q4 was approximately $85 million and approximately $353 million for all of FY06. Capital expenditures were approximately $92 million for Q4 and $288 million for FY
This document summarizes the Q1 FY07 financial results of ConAgra Foods. Some key highlights include:
- Consumer Foods volume increased 1% and Food and Ingredients volume increased 2% in Q1.
- Gross margin was 24.7% and operating margin was 11.7% for the quarter.
- Net debt decreased to $2.88 billion from $3.97 billion in Q1 FY06.
- Restructuring charges totaled $39 million pre-tax, impacting costs in Consumer Foods and corporate expenses.
Major brands in the Consumer Foods segment that posted sales growth included Egg Beaters, Healthy Choice, and Slim Jim. Brands that posted sales declines included ACT II and Blue Bonnet. Total depreciation and amortization from continuing operations was $88 million for the quarter and $177 million year-to-date. Capital expenditures were $66 million for the quarter and $111 million year-to-date. Net interest expense was $52 million for the quarter and $110 million year-to-date.
1) Several major brands in the Consumer Foods segment posted sales growth for the quarter, while others like ACT II and Banquet saw declines. Overall, Consumer Foods volume declined 1% excluding divested businesses.
2) Total depreciation and amortization from continuing operations was around $91 million for the quarter and $268 million year-to-date. Capital expenditures were around $147 million for the quarter and $258 million year-to-date.
3) The company's net debt at the end of the quarter was around $3 billion, with a net debt to total capital ratio of 39%.
"Does Foreign Direct Investment Negatively Affect Preservation of Culture in the Global South? Case Studies in Thailand and Cambodia."
Do elements of globalization, such as Foreign Direct Investment (FDI), negatively affect the ability of countries in the Global South to preserve their culture? This research aims to answer this question by employing a cross-sectional comparative case study analysis utilizing methods of difference. Thailand and Cambodia are compared as they are in the same region and have a similar culture. The metric of difference between Thailand and Cambodia is their ability to preserve their culture. This ability is operationalized by their respective attitudes towards FDI; Thailand imposes stringent regulations and limitations on FDI while Cambodia does not hesitate to accept most FDI and imposes fewer limitations. The evidence from this study suggests that FDI from globally influential countries with high gross domestic products (GDPs) (e.g. China, U.S.) challenges the ability of countries with lower GDPs (e.g. Cambodia) to protect their culture. Furthermore, the ability, or lack thereof, of the receiving countries to protect their culture is amplified by the existence and implementation of restrictive FDI policies imposed by their governments.
My study abroad in Bali, Indonesia, inspired this research topic as I noticed how globalization is changing the culture of its people. I learned their language and way of life which helped me understand the beauty and importance of cultural preservation. I believe we could all benefit from learning new perspectives as they could help us ideate solutions to contemporary issues and empathize with others.
TEST BANK Principles of cost accounting 17th edition edward j vanderbeck mari...Donc Test
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TEST BANK Principles of cost accounting 17th edition edward j vanderbeck maria r mitchell.docx
TEST BANK Principles of cost accounting 17th edition edward j vanderbeck maria r mitchell.docx
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
Dr. Alyce Su Cover Story - China's Investment Leadermsthrill
In World Expo 2010 Shanghai – the most visited Expo in the World History
https://www.britannica.com/event/Expo-Shanghai-2010
China’s official organizer of the Expo, CCPIT (China Council for the Promotion of International Trade https://en.ccpit.org/) has chosen Dr. Alyce Su as the Cover Person with Cover Story, in the Expo’s official magazine distributed throughout the Expo, showcasing China’s New Generation of Leaders to the World.
Economic Risk Factor Update: June 2024 [SlideShare]Commonwealth
May’s reports showed signs of continued economic growth, said Sam Millette, director, fixed income, in his latest Economic Risk Factor Update.
For more market updates, subscribe to The Independent Market Observer at https://blog.commonwealth.com/independent-market-observer.
Independent Study - College of Wooster Research (2023-2024) FDI, Culture, Glo...AntoniaOwensDetwiler
"Does Foreign Direct Investment Negatively Affect Preservation of Culture in the Global South? Case Studies in Thailand and Cambodia."
Do elements of globalization, such as Foreign Direct Investment (FDI), negatively affect the ability of countries in the Global South to preserve their culture? This research aims to answer this question by employing a cross-sectional comparative case study analysis utilizing methods of difference. Thailand and Cambodia are compared as they are in the same region and have a similar culture. The metric of difference between Thailand and Cambodia is their ability to preserve their culture. This ability is operationalized by their respective attitudes towards FDI; Thailand imposes stringent regulations and limitations on FDI while Cambodia does not hesitate to accept most FDI and imposes fewer limitations. The evidence from this study suggests that FDI from globally influential countries with high gross domestic products (GDPs) (e.g. China, U.S.) challenges the ability of countries with lower GDPs (e.g. Cambodia) to protect their culture. Furthermore, the ability, or lack thereof, of the receiving countries to protect their culture is amplified by the existence and implementation of restrictive FDI policies imposed by their governments.
My study abroad in Bali, Indonesia, inspired this research topic as I noticed how globalization is changing the culture of its people. I learned their language and way of life which helped me understand the beauty and importance of cultural preservation. I believe we could all benefit from learning new perspectives as they could help us ideate solutions to contemporary issues and empathize with others.
The Impact of Generative AI and 4th Industrial RevolutionPaolo Maresca
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Enhancing Asset Quality: Strategies for Financial Institutionsshruti1menon2
Ensuring robust asset quality is not just a mere aspect but a critical cornerstone for the stability and success of financial institutions worldwide. It serves as the bedrock upon which profitability is built and investor confidence is sustained. Therefore, in this presentation, we delve into a comprehensive exploration of strategies that can aid financial institutions in achieving and maintaining superior asset quality.
Fabular Frames and the Four Ratio ProblemMajid Iqbal
Digital, interactive art showing the struggle of a society in providing for its present population while also saving planetary resources for future generations. Spread across several frames, the art is actually the rendering of real and speculative data. The stereographic projections change shape in response to prompts and provocations. Visitors interact with the model through speculative statements about how to increase savings across communities, regions, ecosystems and environments. Their fabulations combined with random noise, i.e. factors beyond control, have a dramatic effect on the societal transition. Things get better. Things get worse. The aim is to give visitors a new grasp and feel of the ongoing struggles in democracies around the world.
Stunning art in the small multiples format brings out the spatiotemporal nature of societal transitions, against backdrop issues such as energy, housing, waste, farmland and forest. In each frame we see hopeful and frightful interplays between spending and saving. Problems emerge when one of the two parts of the existential anaglyph rapidly shrinks like Arctic ice, as factors cross thresholds. Ecological wealth and intergenerational equity areFour at stake. Not enough spending could mean economic stress, social unrest and political conflict. Not enough saving and there will be climate breakdown and ‘bankruptcy’. So where does speculative design start and the gambling and betting end? Behind each fabular frame is a four ratio problem. Each ratio reflects the level of sacrifice and self-restraint a society is willing to accept, against promises of prosperity and freedom. Some values seem to stabilise a frame while others cause collapse. Get the ratios right and we can have it all. Get them wrong and things get more desperate.
Detailed power point presentation on compound interest and how it is calculated
Duke Energy 02/01/06_Transcript
1. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
CORPORATE PARTICIPANTS
Julie Dill
Duke Energy Corporation - VP of Investor & Shareholder Relations
Paul Anderson
Duke Energy Corporation - Chairman & CEO
Fred Fowler
Duke Energy Corporation - President & COO
David Hauser
Duke Energy Corporation - Group VP & CFO
CONFERENCE CALL PARTICIPANTS
Greg Gordon
Citigroup - Analyst
Craig Shere
Calyon Securities - Analyst
Steve Fleishman
Merrill Lynch - Analyst
Maureen Howe
RBC Capital Markets - Analyst
Paul Fremont
Jefferies & Co. - Analyst
Scott Thomas
Lehman Brothers - Analyst
Devin Geoghegan
Zimmer Lucas Partners - Analyst
Ashar Khan
SAC Capital - Analyst
Raymond Leung
Bear, Stearns - Analyst
PRESENTATION
Operator
Good day everyone and welcome to the Duke Energy fourth quarter earnings conference. Today's call is being recorded. At this time for opening
remarks I would like to turn the conference over to the Vice President of Investor and Shareholder Relations for Duke Energy, Ms. Julie Dill.
Please go ahead.
Julie Dill - Duke Energy Corporation - VP of Investor & Shareholder Relations
Good morning and thank you for joining us today. With me are Paul Anderson – Chairman and CEO, Fred Fowler – President and Chief
Operating Officer and David Hauser – Group Vice President and Chief Financial Officer. Steve Young – our Corporate Controller – will also be
available to answer your questions today.
This morning, Paul will provide a general overview of 2005 and an update on the merger and then Fred will provide you with more detail around
our business unit expectations for 2006. David will wrap up today’s call with a review of our other financial metrics and expectations. As
always we will take your questions following our prepared remarks.
1
2. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
I would like to make you aware that you will not see the Field Services’ margin by contract schedule today which is normally posted on our
website. The reason for this is that our new MLP – DCP Midstream Partners – will not release its earnings until February 9th. We will post the
margin by contract schedule after their earnings numbers are public. We appreciate your understanding on this delay.
Let me take a moment to read to you the Safe Harbor Statement.
Some of the things we will discuss in today's call concerning future company performance will be forward-looking
statements within the meaning of the securities laws. Actual results may materially differ from those discussed in these
forward-looking statements, and you should refer to the additional information contained in our fourth quarter 2005
earnings release filed with the SEC on Form 8-K and other SEC filings concerning factors that could cause those results to
be different than contemplated in today’s discussion.
Since we will be speaking about our proposed merger with Cinergy, I would ask you to please refer to the S-4 filing of Duke Energy Holding
Corp on file with the Securities and Exchange Commission for factors and risks related to the merger.
In addition, today’s discussion includes certain non-GAAP financial measures as defined under SEC Regulation G. A reconciliation of those
measures to the most directly comparable GAAP measures will be made available on our investor relations website at: www.duke-energy.com.
Now let me turn the call over to Paul.
Paul Anderson - Duke Energy Corporation – Chairman & CEO
Thank you, Julie and good morning everyone.
First off, let me say how incredibly pleased I am with what we were able to accomplish in 2005. I would characterize it as a ‘redefining year’. I
won’t bore you with all of our accomplishments since I went through that on our call in late December. And I’m not going to rehash all the data
in our press release or the 2005 highlights included on this slide.
But suffice it to say that I am very proud of our Duke Energy team. Despite all that was going on - from portfolio changes to hurricanes and ice
storms - our employees kept their focus and delivered outstanding results to our shareholders.
The fourth quarter 2005 came in at $.65 cents per basic share and the ongoing number was $.43 cents per basic share. That’s an increase of 48%
in ongoing earnings over the same period last year, and resulted in us ending the year with earnings that went well beyond our original
expectations.
For the full year 2005 we reported earnings of $1.94 per basic share and our ongoing basic earnings per share were $1.79 which represents an
increase of 19% over the ongoing results for 2004.
Every one of our major businesses delivered exceptional results in 2005. Overall, the company benefited from strong commodity prices, business
expansions, favorable weather, stronger foreign currency rates and outstanding real estate markets.
And we are not losing any momentum as we begin the new year. I know most of you are now focused on 2006, so let me begin with an update
on where we stand with the wind-down of DENA’s discontinued operations.
You may recall in early January we signed an agreement to sell to LS Power, DENA’s entire fleet of power generation assets outside the Midwest
for about $1.54 billion, assuming certain performance measures are met, and no less than $1.48 billion. This sale is subject to FERC and Hart-
Scott-Rodino approvals and is expected to close before June 2006.
As for the rest of the wind-down activity, with the completion of the Barclays transaction which we announced in November, we will have
transferred about 95% of DENA’s trading and marketing portfolio. The agreement with Barclays essentially eliminated our credit, collateral,
market and legal risk associated with DENA’s derivative trading positions.
2
3. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Under the Barclays agreement, we have made very good progress on the novation process. As far as the remaining portfolio of contracts, we
currently have unwound more than 85% – and I spoke with Bobby Evans this morning and he said the number is more like 95% now – of the
non-derivative gas transportation, gas storage and structured contracts.
Given the significant progress we have made on both the asset and contract portfolios, we fully expect to exit DENA’s discontinued operations
in the first half of the year – well ahead of our September 2006 goal. David will talk about the full cash impact from these transactions later on.
Now let me take a moment to update you on our progress with the merger.
As you are probably aware, we have received the majority of the approvals needed to close the merger. At this point, we are waiting on
approvals from the states of Indiana and North Carolina. We are also waiting on approvals from the Nuclear Regulatory Commission and the
shareholders of both companies.
A settlement has been reached between the companies and the staff of the Indiana commission as well as other key stakeholders in that
jurisdiction. Hearings are complete and we hope to have an order soon.
We’ve also reached agreement with the Public Staff in North Carolina. Proposed orders have been submitted, and we anticipate an order from
the North Carolina Utilities Commission in the coming weeks as well.
We expect to receive the NRC approval in the near term and last night we filed with the SEC what we hope is our final amendment to the S-4.
Included in that filing are the names of the people that will comprise the board of directors for the combined company. You will recall that 10
directors will be from Duke and five would come from Cinergy. The directors from Duke include Roger Agnelli, Bill Barnet, Alex Bernhardt,
Bill Esrey, Ann Maynard Gray, Jim Hance, Dennis Hendrix, Michael Phelps and Jim Rhodes. And, of course, I will continue on as chairman of
the board. Jim Martin and Max Lennon were scheduled to retire at our annual shareholder meeting in May but these retirements have been
accelerated as a result of our pending merger.
The five directors from Cinergy are Jim Rogers, Michael Browning, Phil Cox, Mary Schapiro and Dudley Taft. Jim and I are eager to begin
working with this new board and I am personally thrilled with the caliber of the individuals that will be serving our shareholders.
In the S-4 we have also proposed March 10th for both companies’ special shareholders’ meeting to approve the merger. While the S-4 is still
subject to final review, we are cautiously optimistic that we'll be able to mail our proxies out to shareholders in the very near term.
Now I’d like to briefly review our incentive target for 2006.
Let me first point out that the EPS number for incentive purposes is for the combined company for 2006 and assumes that we close our merger
with Cinergy on April 1st, which is our internal ready date.
In December, our Board of Directors approved an incentive target for all employees of $1.90 per ongoing diluted share. The minimum threshold
is set at $1.75 with no payout on the EPS portion if we come in below that number.
As a reminder, 2006 will be the first year Duke Energy will be reporting ongoing earnings on a diluted basis, so the $1.90 is comparable to a
diluted earnings per share for 2005 of $1.73 – almost a 10% increase year over year. You will also note that the minimum threshold for 2006 is
above our 2005 result.
The $1.90 per share includes synergy savings we expect to receive from the combination as well as the sharing of cost savings with customers.
Costs to achieve the merger are not included as those will be considered one-time charges.
Earnings per share is the major component of our company’s incentive structure but each employee will also have individual or team objectives,
many of which are focused on the successful execution of the merger. For the leadership of the company, safety will once again be an area of
primary focus this year – reinforced by a 5% reduction in any bonus payout for leadership should we have an employee, contractor or a sub-
contractor fatality.
As you can tell, the incentives for 2006 are focused on challenging management to deliver outstanding performance and earnings growth.
Now let me turn the call over to Fred who will walk you through the outlook for each of our business units.
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4. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Fred Fowler - Duke Energy Corporation - President & COO
Thanks Paul.
We have completed the evaluation of our business plans and would like to share with you our outlook for our business segments. I would ask
you to note that while the $1.90 is for the combined company, the business segment expectations do NOT include any impact from the merger
with Cinergy. I will give you the merger savings assumption separately.
We will provide an update to our business unit expectations to include Cinergy’s businesses and merger impacts once the merger has closed.
Starting with Franchised Electric, we anticipate ongoing segment EBIT for Duke Power to be essentially flat compared with their ongoing results
for 2005, which were approximately $1.5 billion. This number excludes the merger-related costs-to-achieve, cost savings and sharing expected at
Duke Power as a result of merger agreements we have filed with North Carolina and South Carolina. The agreement in South Carolina has
already been approved.
Customer growth across our service territory in the Carolinas is expected to continue at approximately 2% and our sales assumptions are based on
normal weather conditions.
We will continue to accrue charges for Clean Air amortization and expect actual cash expenditures to be about $400 million this year.
We anticipate ongoing segment EBIT for our Natural Gas Transmission business to also be essentially flat compared with the ongoing results for
2005 of approximately $1.39 billion. The reason 2006 doesn’t show any growth is due to a couple of reasons. First is the new interest expense
associated with the Gulfstream pipeline and, second, is the formation of the Canadian Income Trust.
Duke will recognize lower equity earnings from the Gulfstream project due to the addition of interest expense associated with the $850 million of
project-level financing that we put in place last fall. Duke Energy’s 50% portion of that interest expense is approximately $25 million. So, while
the Gulfstream financing and the formation of the Canadian income trust will be a decrease at the EBIT level, they’re both accretive to our
bottom line.
Growing demand for natural gas supplies is the primary driver for long-term earnings growth at Natural Gas Transmission. A number of open
seasons for additional capacity have demonstrated that customers are looking for new supplies of natural gas. As Martha Wyrsch outlined in the
December investor chat, our gas pipeline and storage operations will be expanding to meet this new demand.
Going forward, our expectation is that this business continues to be a 3-5% growth business operating in an opportunity-rich environment.
With crude prices hovering in the mid-60’s, Field Services is poised to deliver another year of strong earnings. For 2006, we anticipate ongoing
equity earnings to be approximately $500 million.
Just to put this into perspective for you – if we were to restate the full year 2005 on a comparable ongoing equity earnings basis, net of hedging
impacts – the 2006 ongoing equity earnings for Field Services are expected to be about $220 million higher than 2005.
We do use the forward curves to determine commodity prices when putting our business plans together and, for 2006, this means that we used an
average crude oil price of $61 per barrel.
The prices on our hedges for 2006 are higher than they were for 2005 and our hedged volumes are lower for 2006. This change in our hedge
profile will allow us to realize higher earnings this year.
Our equity earnings sensitivity in 2006 to a $1 per barrel change in crude oil prices equates to about $15 million. That will be offset by
approximately $5 million in Other EBIT as it relates to the de-designated hedges that we carry there.
For 2006, we anticipate that International Energy will deliver ongoing segment EBIT of approximately $275 million. While our international
operations had a record year in 2005, we do anticipate a pullback from that level of earnings in 2006. This is primarily due to the effect of
commodity prices on our National Methanol business.
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5. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
For 2006, we are about 96% contracted in Brazil and our forecast has assumed normal hydrology for our Latin American operations.
We’ll look for Crescent’s ongoing segment EBIT from continuing and discontinued operations for 2006 to come in around $250 million. Given
the continued strength of the real estate markets and Crescent’s ability to develop and sell into these markets, we expect 2006 to be another good
year even though it’s somewhat lower than the record year we’ve seen in 2005.
Crescent has also been able to reinvest in its business to maintain its portfolio for future development at a rate comparable to 2005. Crescent’s
book value at the end of 2005 was $1.3 billion.
On a cash flow basis, we expect Crescent to contribute to Duke Energy positive net cash flow from operating and investing activities of at least
$100 million. In fact, with the strong results for 2005, they were able to contribute about $200 million back to Duke.
Other EBIT includes DENA’s continuing operations, DukeNet, which is our telecommunications business, corporate governance and other
parent-level activities. For 2006, this category is anticipated to run in the neighborhood of $330 million in ongoing net expenses, which do not
include approximately $110 million in ongoing losses associated with DENA’s continuing operations.
The losses for DENA’s continuing operations do reflect lower gross margins in the Midwest, offset by lower G&A expenses and the continued
wind down of the DETM business, as well. And again, they do not include any benefits from the merger. We fully expect that post merger,
when we combine the Midwest fleet with Cinergy’s marketing and trading operations, these assets will reap the benefits of a consolidated
operation, with some increased utilization, major G&A reductions as well as lower operating expenses.
For the balance of “Other”, about half of the $20 million additional expense in 2006 is due to a change in accounting related to timing of
recognition of executive stock awards and the other half is simply a shift in shared service costs from the business units to corporate governance.
That covers all of the existing Duke Energy businesses. For Cinergy’s operations, we anticipate a total ongoing EBIT contribution of
approximately $800 million for nine months of the year. Again, I would ask you to please note that this EBIT number for Cinergy also excludes
any impacts from the merger.
The assumptions behind Cinergy’s number include base rate increases, which have been previously disclosed, of approximately $50 million for
CG&E’s transmission and distribution, about $10 million for Union Light Heat & Power and approximately $10 million for PSI. The $800
million also assumes a 1.6% sales growth rate.
As for synfuel, there are no earnings or credits associated with synfuel activities included in this amount. All of the synfuel adjustments have
been made at the Duke Energy level as an on-the-top adjustment for planning purposes.
Next I would like to review the merger cost savings and costs-to-achieve that’s included in 2006.
Achieving our goals for cost savings and costs-to-achieve is a top priority this year. Our integration teams have worked very hard to scrub the
business in order to achieve these goals. Based on the most recent reports from these teams, we are extremely confident in our ability to meet the
targets that we laid out for you in September of last year. Just as a reminder, our five-year targets were slightly more than $1.3 billion in gross
savings and $675 million for costs-to-achieve, leaving you with a net savings amount of about $650 million.
Included in our forecast for 2006 is approximately $140 million of anticipated cost savings. Coincidentally, we are expecting to return
approximately $140 million back to our customers as part of the sharing agreements we have with the states in 2006. You may recall that we
have agreed to share about $240 million of the overall cost savings with our customers, and we estimated that this sharing would begin in June
2006. The balance of the cost sharing will occur in 2007 and is estimated to be approximately $90 million. As Paul mentioned earlier, any costs-
to-achieve will be considered a special item and they are not included in our $1.90 incentive target.
With that let me hand it over to David to review some other financial metrics and expectations.
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6. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
David Hauser - Duke Energy Corporation - Group VP & CFO
Thanks, Fred.
The net income number that you will see on our cash flow review will be $2.225 billion and is indicative of the target level of $1.90 per ongoing
diluted share as it relates to the company’s short-term incentive program. It is our intention that the company’s ongoing earnings per diluted
share will track the EPS used for incentive purposes.
Let me point out a few other items that are included in this EPS target.
First, there is a $60 million pre-tax benefit, or about 3 cents, as a result of purchase accounting adjustments related to the merger. This is our best
estimate of what the impact will be and is subject to change until we actually close on the merger. It is important to note that, while it’s our
intention of having the company’s ongoing earnings per diluted share track the EPS used for incentive purposes, any impact of our purchase
accounting adjustment that is either above or below the 3 cents will not be included in the incentive target for employees.
Also included in our EPS target is a benefit of approximately 5 cents related to synfuels. This is the on-top adjustment that Fred mentioned
earlier. Given the current price of crude oil, these facilities may not operate this year. Should this be the case, the shortfall on the synfuel side
would essentially be offset by better results at our Field Services and National Methanol businesses. The diversification of our portfolio with
Cinergy provides us a natural hedge with prices over $60 a barrel.
As we’ve discussed before, Duke Energy would be in a position to restart its $2.5 billion stock buyback program following the shareholder vote
on the merger. This program was suspended at the time we announced the merger and SEC rules prohibit any meaningful stock repurchases until
the shareholder vote is complete. While we haven’t made any definitive decisions on this matter, for planning purposes we have included a stock
buyback in 2006 of approximately $1 billion.
Finally, I would also like to point out that the $1.90 does not exclude the effect of ongoing mark-to-market earnings, which is consistent with
Duke Energy’s current practice.
Let me talk a bit more specifically about cash.
Unlike the EBIT numbers Fred covered for the businesses that were on a stand alone basis, the cash flow numbers I am going to discuss with you
are for the combined company.
We expect to generate approximately $475 million in positive net cash at Duke Energy. Starting with the net income number of $2.225 billion,
we would add back almost $2.1 billion for depreciation and amortization and the net book value of Crescent’s real estate sales of approximately
$425 million.
Asset sales for the year have an estimated net book value of approximately $1.475 billion. This amount is related to the sale of DENA’s
generation facilities in the West and Northeast to LS Power.
With what we know today regarding all of the DENA transactions, we expect the total net cash inflows to Duke will be at least $600 million,
excluding returned collateral. For 2005, we had total net cash outflows of approximately $400 million and we anticipate net cash inflows to be
approximately $1 billion in 2006, excluding returned collateral.
There are no other significant asset sales for the remainder of the year reflected in this plan. However, as in the past, if someone sees more value
in one of our assets than we do, we might consider such a sale – but only if it made both economic and strategic sense to Duke Energy.
Taking into account tax timing differences and other net uses of cash, total sources of cash for 2006 are estimated at $6.25 billion.
The primary uses for cash are capital expenditures and dividends. We have set a capex budget of approximately $4.3 billion for the year and I’ll
walk you through those details in just a moment.
As far as the dividend is concerned, we remain comfortable with a targeted payout ratio of approximately 70%. For 2006, we have included in
our plan a dividend increase of one cent per quarter beginning in the second half of the year. This equates to an annual increase of 4 cents per
share. Should we decide to increase the dividend, this will of course require approval by the board of directors before any change in our dividend
could actually take effect.
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Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Taking all of this into account, we are left with about $475 million of net cash inflow for 2006.
Now let me give you more detail around capex.
Of the total $4.3 billion budget for capital expenditures, almost $3.4 billion is capex for the Duke Energy operations and approximately $950
million is for Cinergy’s operations. Total maintenance capex is expected to be approximately $3.1 billion, including environmental expenditures
of about $865 million. The remaining balance of about $1.2 billion will be allocated to expansion projects.
Duke Power’s total capex is expected to be about $1.7 billion in 2006. If you break that down further – maintenance is about $1.2 billion,
environmental spending about $400 million and the rest is for expansion activities.
Capex for the Natural Gas Transmission business is expected to be about $950 million this year and is roughly split in half between maintenance
and expansion requirements.
Crescent Resources expects their expansion capex to run slightly higher than last year, at approximately $650 million.
Capex for our international operations is expected to be about $50 million. Maintenance will run about $30 million and the remaining balance
will be for expansion opportunities.
Other capex is expected to be about $25 million of maintenance-related expenses.
The remaining balance of approximately $950 million is for the Cinergy operations and is essentially evenly split between maintenance and
environmental spending.
Capex for Field Services is not included in these numbers since they are no longer consolidated on our financial statements.
So let me move to the debt portion our balance sheet.
Duke Energy ended 2005 with a very healthy balance sheet. We have reduced the risk profile of the company and this has been recognized by
S&P upon the announcement of the DENA transaction with LS Power.
We ended the year with a 48% debt to cap ratio and we expect to be at 46% by the end of 2006. This reflects the 100% equity consideration
related to the merger and the debt assumed.
The combined debt balance of the two companies for 2005 was $21.7 billion and is not expected to change significantly over the year.
Prospectively, we plan to maintain a disciplined approach to managing the balance sheet.
Given this level of debt and current interest rates, we expect interest expense for the year to be approximately $1.2 billion. That’s an increase of
approximately $100 million primarily due to the addition of Cinergy’s debt balance partially offset by the deconsolidation of Field Services.
Going forward, I plan to focus less on the debt to cap ratio and focus more on the Funds From Operations interest coverage as this measure is a
better indicator of the company’s credit strength. We expect the FFO interest coverage of the new entity to be approximately 4.8 times which
should result in strong investment grade credit ratings.
I know many of you, especially on the fixed-income side, are particularly interested in what the legal structure will be post closing. We are still
working through the details of that structure and won’t be able to provide any new information today. But I will affirm that it is Duke Energy’s
intent to remain obligated at the Duke Power level for the existing senior unsecured debt of Duke Power and that servicing of this debt will
continue at the Duke Power level.
Let me also note that we have not finalized what our reporting structure will be either. Both the legal and reporting structures will be provided to
you upon the completion of the merger.
As it regards taxes, the effective tax rate for the combined company will be approximately 35% due to the higher tax rate associated with
Cinergy’s operations.
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8. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
When we announced the merger with Cinergy we indicated that the transaction would be accretive in the first full year based on street estimates.
However, our forecast for 2006 now shows that it is actually somewhat dilutive for the nine months of the year we are a combined company.
This is primarily because of the accelerated revenue reductions related to the sharing of merger cost savings.
Our original estimate did not contemplate that we would essentially have five years of revenue sharing with our customers all crashed forward
into the first twelve months. But we fully support the accelerated reductions as it will get most of the sharing out of the way by the middle of
2007 and give us a clean slate from that point on. It’s also important to note that the first quarter of the year is typically one of Cinergy’s stronger
quarters, so the inclusion of only nine months of Cinergy’s earnings has an impact on the combined 2006 earnings as well.
The ongoing earnings per diluted share for the combined company will be accretive starting in 2007 and will continue to grow in the expected
range of 4 – 6% thereafter
We’ve walked through a lot of information this morning, and if you put it all together, you’re just about a nickel short of the $1.90. So - just so
we don’t drive you crazy - that remaining nickel comes from interest income associated with a prior period tax credit.
Now let me turn the call back over to Paul for his closing thoughts.
Paul Anderson - Duke Energy Corporation - Chairman & CEO
I’ll wrap up by saying that 2005 was a remarkable year for Duke Energy and I couldn’t be more pleased with those employees who kept their
focus on the many goals they had. We ended the year with outstanding business results and took the first steps in building a better Duke Energy
for the future.
As we look to the new year, we have outlined in straightforward language, what we expect of ourselves and what you should expect from us. Our
charter is the scorecard we have developed for 2006 and it has been embraced by Jim Rogers, so I would not expect to make any significant
changes to these objectives once the merger closes.
This year our efforts are focused on becoming an industry leader in what we see as a new era of growth. To accomplish this goal we must
successfully complete the merger with Cinergy; maintain our focus on safety, diversity and inclusion; and, deliver on our financial objectives.
We will also complete the exit from the DENA business and be positioned to pursue other strategic portfolio opportunities, such as the possible
split of the gas and power businesses or a long-term strategy for our Canadian operations. Lastly, we will continue to build credibility with our
stakeholder base.
As I said at the beginning of this call – we haven’t lost any momentum coming into the year and we are well-positioned to take advantage of good
market opportunities. We are looking forward to delivering another outstanding year of solid earnings and increasing value for our shareholders.
With that, we’ll be happy to take your questions.
QUESTION AND ANSWER
Operator
Thank you.
We will hear from Greg Gordon with Citigroup.
Greg Gordon - Citigroup - Analyst
Thank you. Good morning. I have a couple of quick questions for you. First is the Cinergy EBIT, you're assuming $800 million, I just want to
make sure I heard correctly, that that includes no synfuel contribution from the Cinergy side of the business, is that correct?
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9. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Paul Anderson - Duke Energy Corporation - Chairman & CEO
That is correct.
Greg Gordon - Citigroup - Analyst
Can you give us what the annual EBIT estimate that sort of syncs up with that $800 million is, since you said that you thought that Cinergy is
sort of a stronger contribution coming from Q1?
Paul Anderson - Duke Energy Corporation - Chairman & CEO
I don't think we have that to put out today.
Greg Gordon - Citigroup - Analyst
Okay. And then you also said that you have a $0.05 contribution in there from the synfuel from the Duke Energy side, but you sort of got a dirty
hedge there, because you're only assuming $61 oil at Field Services at your Latin America ops, correct?
David Hauser - Duke Energy Corporation - Group VP & CFO
Yes, the synfuel is from the Cinergy side, not from the Duke Energy’s side, but yes.
Greg Gordon - Citigroup - Analyst
I'm sorry. So to the extent that that $0.05 goes away, it would be offset by higher realized prices at your Duke Energy side businesses?
David Hauser - Duke Energy Corporation - Group VP & CFO
Yes.
Greg Gordon - Citigroup - Analyst
And then finally, a little bit surprised at the ongoing loss at DENA is estimated to be $110 million of EBIT, given that the only remaining assets
are the 3600-megawatts in the Midwest. Can you give us a buildup of why those losses are still as high as they are?
Fred Fowler - Duke Energy Corporation - President & COO
Yes, I think the important thing is that is a look at it, if you can continue it on a stand-alone basis. And it really is made up by the fact that we see
lower, we see lower margins on the Midwest just looking at the price curves for next year.
The other part is that we continue to have a lot of overhead. If we operated that thing on a separate basis; that overhead should go away when we
combine with Cinergy.
Greg Gordon - Citigroup - Analyst
So as we look, as we roll into the latter half of 2006 and beginning of 2007, we will start to see that overhead decline?
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10. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Fred Fowler - Duke Energy Corporation - President & COO
Yes.
Greg Gordon - Citigroup - Analyst
And there is also the strategy, also hopefully entails over time selling more of that power into the retail load obligation in Ohio, correct?
Fred Fowler - Duke Energy Corporation - President & COO
Well, directionally, but I think even earlier than that, I think just for the fact that they -- their operation really operates in that PJM market, and
Midwest market, I would hope that just, you know, that they probably can do a better job of marketing those assets than we did, because of their
position and expertise in that area.
Paul Anderson - Duke Energy Corporation - Chairman & CEO
I think the big difference is it will be part of a fleet that has base load, mid merit, and peaking, as opposed to just be some stand-alone combined
cycle plants. When you make it part of a fleet, it should be more efficient from the standpoint of dispatch, as well as operations. As Fred said, the
overhead will be eliminated.
Greg Gordon - Citigroup - Analyst
So the implication here, if I'm hearing you correctly is, that this $110 million estimate is quite conservative, relative to what you think the
ongoing EBIT should be. Do you think we might see some upside in that number in 2006? Or is that really something we should look at for
2007?
Paul Anderson - Duke Energy Corporation - Chairman & CEO
I think the critical thing is that the numbers that Fred went through, are the starting point that we will be recasting all the numbers, as we put the
company together, so, you know, there will not be a stand-alone DENA number, once we merge the companies.
And I think that is important to understand, is that once we actually get the two companies together, then we will be recasting them, and actually
some different segments and so, you know, you aren't going to be able to see that $110 million going forward, because it will be part of our
commercial operations.
Operator
Next question will come from Craig Shere with Calyon Securities.
Craig Shere - Calyon Securities - Analyst
Hi. Paul, I'm assuming in light of the merger, this is one of the last earnings calls you will be moderating, let me take this opportunity to
congratulate you on a job well done.
Paul Anderson - Duke Energy Corporation - Chairman & CEO
Well, thank you.
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11. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Craig Shere - Calyon Securities - Analyst
I have three, hopefully quick questions. One, if you all could quantify the impact of weather, year-over-year and versus normal, for the fourth
quarter and full year, if you have that. And the second question, still a little confused on the impact of legacy DEFS hedges in the fourth quarter.
If I understand it, the mark-to-market effects of 2005 hedges have all been adjusted out of EPS from continuing ops, but there is also the effect of
the 2006 hedges with mark-to-market, if I understand it.
And the last question, relating to Crescent, Crescent has done a great job, but I wonder, can you all kind of give us, if not specifically quantify a
general idea, or a guidance about versus book, how much is the value of the land? I mean even apart from the value-added development of the
properties, do you all think that you're just sitting on a significant higher value than is on the books, just in the pure land?
Fred Fowler - Duke Energy Corporation - President & COO
Wow. Okay. Let me try the first couple and make sure we got them all straight here. The weather for the year was about $55 million. So that
was the first question; at franchised electric.
Craig Shere - Calyon Securities - Analyst
The weather, now is that versus normal or year-over-year?
Fred Fowler - Duke Energy Corporation - President & COO
That's year-over-year.
Craig Shere - Calyon Securities - Analyst
Okay.
Fred Fowler - Duke Energy Corporation - President & COO
Second question deals with the hedges. So let me tell you the pieces, and see if this works through your question. So first of all, we had hedges
for 2006, and the mark-to-market on those since February 22 is $100 million. So we have $100 million that hit earnings this year, associated with
those hedges.
Craig Shere - Calyon Securities - Analyst
And what was the impact of that in the fourth quarter?
Fred Fowler - Duke Energy Corporation - President & COO
It was actually positive in the fourth quarter of $19 million.
Craig Shere - Calyon Securities - Analyst
And that is included in the continuing --
Fred Fowler - Duke Energy Corporation - President & COO
All that is in continuing --
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12. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Craig Shere - Calyon Securities - Analyst
Okay. Great.
Fred Fowler - Duke Energy Corporation - President & COO
Secondly, we settled hedges. And that was $92 million of the 2005 hedges. So we had, if you look at the total for the year, since we crashed them
forward on February 22, we had $193 million that we have absorbed, associated with the 2006 and 2005 hedges.
Craig Shere - Calyon Securities - Analyst
Okay. Great.
Paul Anderson - Duke Energy Corporation - Chairman & CEO
Now, I will take Crescent. I think the first thing to note with regard to Crescent is that if you look at their income for the last year, the vast
majority has nothing to do with legacy land sales. It is developments that go beyond the Carolinas. In fact, a lot of it has nothing to do with the
land adjacent to our power operations. About 15-20% is all that came from legacy land sales.
As to whether we are sitting on land that is worth more than book value, I would assume that it is. As in all cases, when have you large tracts of
land, the real key is to figure out how to peel it off, if you will, or how to develop it, as opposed to trying to do something with it as a big lump.
So I think we have an asset there that can be developed over the years, and it does have unrealized value that we will realize over the coming
years, but the real income and the real value created by Crescent has been outside the legacy land.
Craig Shere - Calyon Securities - Analyst
Great. And David, what was the year-over-year for the fourth quarter on the weather?
David Hauser - Duke Energy Corporation - Group VP & CFO
The year-over-year for the fourth quarter is $35 million.
Craig Shere - Calyon Securities - Analyst
Thanks a lot.
Operator
We will now hear from Steve Fleishman with Merrill Lynch.
Steve Fleishman - Merrill Lynch - Analyst
Hi, everyone.
Paul Anderson - Duke Energy Corporation - Chairman & CEO
Hi, Steve.
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13. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Steve Fleishman - Merrill Lynch - Analyst
Hi. I have a couple of questions. First, just on the merger savings, my recollection is kind of a full run rate, getting to $440 million a year.
Fred Fowler - Duke Energy Corporation - President & COO
Yes.
Steve Fleishman - Merrill Lynch - Analyst
And when do you think you get to that full run rate?
Fred Fowler - Duke Energy Corporation - President & COO
Year three.
Steve Fleishman - Merrill Lynch - Analyst
Okay. And secondly, on the mark-to-market earnings that you're continuing to include, do you have a rough estimate of what those are for 2006?
Obviously I mean does it basically zero out for the year, because all the hedges are close out?
David Hauser - Duke Energy Corporation - Group VP & CFO
That's exactly right. It zeros out for the year. There may end up being some, but there is none we know of right now.
Steve Fleishman - Merrill Lynch - Analyst
And it should be a positive, right? Because you're marking back these losses?
David Hauser - Duke Energy Corporation - Group VP & CFO
The $100 million associated with the 2006 hedges gets reversed next year, and is included in the $1.90.
Steve Fleishman - Merrill Lynch - Analyst
And that's in the Others EBIT segment?
David Hauser - Duke Energy Corporation - Group VP & CFO
Yes.
Steve Fleishman - Merrill Lynch - Analyst
Okay. And I guess do have you a number for 2006 on percent hedged at DEFS?
Fred Fowler - Duke Energy Corporation - President & COO
Yes, it is slightly over 30%.
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14. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Steve Fleishman - Merrill Lynch - Analyst
It is about 30%? At what price?
David Hauser - Duke Energy Corporation - Group VP & CFO
Well, keep in mind, it is mark-to-market at the end of the year, and the market at the end of the year was $63.
Steve Fleishman - Merrill Lynch - Analyst
Okay. So effectively, in a way, the whole thing is selling at market in 2006, since you mark the hedges, too?
David Hauser - Duke Energy Corporation - Group VP & CFO
Yes, that's right.
Fred Fowler - Duke Energy Corporation - President & COO
That's why we refer to them as the de-designated hedges.
Steve Fleishman - Merrill Lynch - Analyst
Correct. Okay.
David Hauser - Duke Energy Corporation - Group VP & CFO
Let me make one other comment, just as we roll Cinergy into Duke Energy, and work as a combined entity, Cinergy does have some mark-to-
market also, but we haven't, we don't know what that would be. There is no estimate of that at this point at the end of the year for next year.
Steve Fleishman - Merrill Lynch - Analyst
Okay. I have one last question. Cash at year end 2005 and based on all the numbers you gave us, David, including the buyback, the one billion
dollars, what do you expect cash will be at year end 2006?
David Hauser - Duke Energy Corporation - Group VP & CFO
Well, if you took a $1.054 billion, and added the $475 million, that would take to you a billion and a half, and if you spend a billion buying back
shares, you would be roughly at $500 million.
Steve Fleishman - Merrill Lynch - Analyst
Okay. Thank you very much.
Operator
We will now move on to Maureen Howe with RBC Capital Markets.
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15. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Maureen Howe - RBC Capital Markets - Analyst
Thanks very much. Paul, this question is for you. And I'm just trying to understand why would you exclude the costs to achieve, from your target
for 2006, your incentive target, and how can you ensure that those costs are incurred in the most efficient manner?
Paul Anderson - Duke Energy Corporation - Chairman & CEO
Well, we will be tracking those costs, and we will be controlling them very closely. I mean we have I guess you might say; a parallel effort with
regard to Cinergy's, that we're tracking them independently of the performance of the business units. And so that will be the effort that ensures
that we're being efficient. The reason that we're excluding them is many of them apply to future years, and they're somewhat investments if you
will, in the future, and so we have chose to leave those out, because layoffs and things like that, that might help us in future years, are really one-
time events at the time they take place.
Maureen Howe - RBC Capital Markets - Analyst
So you're viewing it more as an investment?
Paul Anderson - Duke Energy Corporation - Chairman & CEO
Yes.
Maureen Howe - RBC Capital Markets - Analyst
Like an investment in capital?
Paul Anderson - Duke Energy Corporation - Chairman & CEO
Well, some of it will be capital and some of it will be expensed. But yes, what is being expensed I think a good example is severance, I mean the
benefit of a severance program goes on for a long time.
Maureen Howe - RBC Capital Markets - Analyst
But I guess the concern would be you could invest more in cost to achieve, certainly for long-term return, but also if you will, to pump up current
earnings as well, that's why I wonder why you would exclude it, in terms of an incentive target.
Paul Anderson - Duke Energy Corporation - Chairman & CEO
Well, as I said, we have set objectives for costs to achieve, and people in their individual incentives will be held accountable for that.
Maureen Howe - RBC Capital Markets - Analyst
I see.
Paul Anderson - Duke Energy Corporation - Chairman & CEO
We've got about $160 million of costs to achieve that are anticipated for the year, and we've got a tracking system against them, and every group
and every individual has a budget for their portion of that.
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16. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Maureen Howe - RBC Capital Markets - Analyst
Okay.
David Hauser - Duke Energy Corporation - Group VP & CFO
And that $160 million is the expense piece. There are other pieces, too.
Maureen Howe - RBC Capital Markets - Analyst
Okay. Just a clarification and if you gave it, I apologize, I missed it but when were you going through the 2005 hedges settled, and you said there
is $92 million for the year, I'm wondering how much was in the fourth quarter?
David Hauser - Duke Energy Corporation - Group VP & CFO
I believe I've got that. Let's see. $42 million of the $92 is in the fourth quarter.
Maureen Howe - RBC Capital Markets - Analyst
That's great. Thanks very much.
David Hauser - Duke Energy Corporation - Group VP & CFO
Okay.
Operator
We will now take a question from Paul Fremont with Jefferies.
Paul Fremont - Jefferies & Co. - Analyst
Hi, thank you very much. First question would be both the internal ready date and the Cinergy contribution is based on an April 1st type closing.
Is that something that you would consider to be likely at this point, based on where are you in the approval process?
Paul Anderson - Duke Energy Corporation - Chairman & CEO
Well, if you look at where we are in the approval process, assuming that the S4 goes effective in the next few days, which you know, we
certainly hope it will, and we're able to hold our Shareholder Meeting on the 10th of March, certainly that supports the date. We're then down to
getting a final order from North Carolina, Indiana, and final approval from the NRC. If you just look at those hurdles, or those necessary
conditions, there is nothing that we anticipate in any of them, that would go beyond that date. But you know, you never can tell until the fat lady
sings, it isn’t over.
Paul Fremont - Jefferies & Co. - Analyst
Second question would be looking at Field Services, you're pointing out I guess in your 2006 presentation, that there is upside with respect to oil
prices. But isn't there also an additional benefit to you in that business, based on how weak near-term gas prices have fallen to, so the key pole
contracts to me look like they would result in a much better frac spread.
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Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Fred Fowler - Duke Energy Corporation - President & COO
We're off to a very nice start, yes. And that does matter to us, because we have a lot of gas that, depending on what frac spread is, we either
process or don't process. Obviously with the kind of frac spreads we've observed for January, we've been processing that gas. And that's a pretty
big volume of gas. So we're off to a nice start.
Paul Fremont - Jefferies & Co. - Analyst
And that would I guess be benefit that would be beyond sort of the hedge for synfuel, right?
Fred Fowler - Duke Energy Corporation – President & COO
I think, yes, I think that is probably kind of what David was referring to, the hedge against synfuel.
David Hauser - Duke Energy Corporation - Group VP & CFO
Well, I mean there is no direct impact of the frac spread to the synfuel.
Paul Fremont - Jefferies & Co. - Analyst
Right.
David Hauser - Duke Energy Corporation - Group VP & CFO
Okay.
Paul Fremont - Jefferies & Co. - Analyst
And then I guess the other thing I'm a little confused is on, is in the natural gas transmission, you know, one of the offsets that you're pointing to
is interest expense, but you're basically saying that that is going to create earnings before interest, which are flat, so I don't quite follow why the
$25 million of interest would have an effect on your earnings before interest.
David Hauser - Duke Energy Corporation - Group VP & CFO
It is because this is a 50/50. So it is not fully consolidated on our books. So we simply bring in the earnings net of interest expense. Because it is
a 50/50, it is a single line item on our income statement, not fully consolidated.
Paul Fremont - Jefferies & Co. - Analyst
So the accounting is the equity contribution?
David Hauser - Duke Energy Corporation - Group VP & CFO
That's exactly right.
Paul Fremont - Jefferies & Co. - Analyst
Okay. Thank you very much.
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Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Operator
We will now hear from Scott Thomas with Lehman Brothers.
Scott Thomas - Lehman Brothers - Analyst
Good morning, folks. I have two quick questions. One was about can you quantify the currency impact of tailwind from Brazil or Canada? And
can you remind me how much of the $2.5 billion of stock buyback you authorized last year; you had completed before announcing the merger
and halting the buyback program.
David Hauser - Duke Energy Corporation - Group VP & CFO
The stock buyback was $930 million, does that sound right? I think that was the total. The FX for Canada, did you ask for the year or for the
quarter?
Scott Thomas - Lehman Brothers - Analyst
For the year is fine.
David Hauser - Duke Energy Corporation - Group VP & CFO
It was $37 million. That's on an EBIT basis. On a net income basis, it is $15 million.
And Brazil was $24 million, and $11 million; EBIT and net income respectively.
Scott Thomas - Lehman Brothers - Analyst
That's great. Thanks a lot, fellows.
Operator
Next question will come from Devin Geoghegan with Zimmer Lucas Partners.
Devin Geoghegan - Zimmer Lucas Partners - Analyst
Hi. Thanks for the time this morning. Just curious, in terms of Duke Energy’s franchised electric how much clean air amortization expense are
you expensing in 2006? And then how much was expensed in 2005?
Fred Fowler - Duke Energy Corporation - President & COO
The typical run rate there is about $280-$285 million.
Devin Geoghegan - Zimmer Lucas Partners - Analyst
Okay.
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Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Fred Fowler - Duke Energy Corporation - President & COO
And I think the actual number for 2005 was a little ahead of that. It was $311 for 2005.
Devin Geoghegan - Zimmer Lucas Partners - Analyst
Okay. I have just two quick questions after that. Franchised electric, it seems like you have costs increasing, or is it weather that keeps you flat
into 2006? And then the second question is, in your capex is there any money included for the coal plant, coal plants you guys have proposed?
David Hauser - Duke Energy Corporation - Group VP & CFO
The second question, there is some money for the coal plant in the capex for franchised electric, and what was the first question again?
Devin Geoghegan - Zimmer Lucas Partners - Analyst
In the $1.5 billion in EBIT in 2005. You mentioned that weather was $55 million, but that was versus 2004. I'm just trying to figure out how
much of the 2005 was weather and not other things.
Fred Fowler - Duke Energy Corporation - President & COO
Yes, it is a combination of two things, actually, is why we kind of are remaining flat. One is the fact that weather adjusts us back down some. We
did have increased earnings off the weather this year.
And then the other reason is increased costs, and quite frankly, we are seeing cost pressures in our major businesses that really kind of
resulting from the tightness of contractors as a result of the amount of work that is going on in the Gulf of Mexico, and on the Gulf Coast of
Mexico, in the energy business. That is causing some cost pressure. We have done a real good job of holding costs for the last few years. But we
are seeing pressures at this point.
Paul Anderson - Duke Energy Corporation - Chairman & CEO
Well, and then we had a $46 million cost associated with the ice storm in the fourth quarter also, which was sort of an unusual cost.
Devin Geoghegan - Zimmer Lucas Partners - Analyst
That's embedded in the $1.5 million?
Paul Anderson - Duke Energy Corporation - Chairman & CEO
Yes.
Devin Geoghegan - Zimmer Lucas Partners - Analyst
So is it fair to think that costs are probably increased on the order of $50 to $60 million just overall?
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20. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Fred Fowler - Duke Energy Corporation - President & COO
No. Well, when you include depreciation, I can give you a better, a little more color around that.
O&M increases about $50 million. Depreciation increases about $35 million. Purchase capacity for electricity increases by about $10 million.
And general taxes have increased by about $20 million.
Devin Geoghegan - Zimmer Lucas Partners - Analyst
Great. I really appreciate that. Thank you very much for your time.
Operator
Next question will come from Ashar Khan with SAC Capital.
Ashar Khan - SAC Capital - Analyst
Good morning. David, in your comments you had mentioned that the merger was dilutive in the first year. Am I assuming that’s using $1.90,
right, for the incentive target number? Is that correct? That Duke Energy stand alone would have been higher than $1.90 for 2006, if I took your
remarks correctly.
David Hauser - Duke Energy Corporation - Group VP & CFO
I think that is correct.
Ashar Khan - SAC Capital - Analyst
So if I take away the $0.05, am I correct in the $1.90, there is $.05 for the synfuel, which comes from Cinergy, and the synfuel is in and out, you
don't know, and the $0.03 is a purchase accounting adjustment which you mentioned, so the dilution is then, we are talking about the 6-7% range,
if you take out those two numbers. Am I looking at that right?
Paul Anderson - Duke Energy Corporation - Chairman & CEO
I don't exactly want to get into the game of saying what is dilution going forward. I'm going to answer that for David, because I've been through
this a number of times, and as soon as you start saying what would we have been if we hadn't done these things, you get into a game of trying to
track phantom companies, and you know, I think to say that it is somewhat dilutive in 2006, and it becomes accretive in 2007, given our current
forecasts is where we want to end up.
Ashar Khan - SAC Capital - Analyst
Okay. I would like to end up with a question on the buyback? How are you assuming the buyback? Is it a one-time buyback, or is it a buyback,
accelerated share buyback in terms of assumptions, because you put out a net income number and you put out earnings per share number, and I'm
just trying to do quickly the calculation. What is assumed in the buyback? Is it buyback that is an accelerated share repurchase plan, or is it a
buyback which is throughout the -- I guess, the six to nine month period after the merger closes?
Fred Fowler - Duke Energy Corporation - President & COO
We have not made the decision of what we're going to do. But the assumption is that all the buyback occurs in the first half of the year.
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21. PREPARED REMARKS AND Q&A
Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Ashar Khan - SAC Capital - Analyst
Okay. All the buyback occurs in the first half of the year. Thank you very, very much.
Operator
And we will now take a question from Raymond Leung with Bear, Stearns.
Raymond Leung - Bear, Stearns - Analyst
Hey, guys. I have a couple of questions. David, you mentioned about half a billion of cash. You didn't mention, should I include also the asset
cash from the DENA sale?
David Hauser - Duke Energy Corporation - Group VP & CFO
The $475 million that was on the table includes the cash from the DENA sale.
Raymond Leung - Bear, Stearns - Analyst
Oh, it does. All right. Thanks. And just with respect to financing strategy, can you talk about what you may or may not do with the maturities at
Duke Capital coming up here, and what your thought process is on that?
David Hauser - Duke Energy Corporation - Group VP & CFO
Our general thought process is that our balance sheet is strong, so basically, as debt matures at various nodes, we will be refinancing that debt.
Raymond Leung - Bear, Stearns - Analyst
Would you still do it at Duke Capital, or would you look to move some within the operating companies?
David Hauser - Duke Energy Corporation - Group VP & CFO
Well, no final decisions have been made, but I would think most of Duke Capital's debt would be refinanced at Duke Capital. But that's still a
work in progress.
Raymond Leung - Bear, Stearns - Analyst
Great. Thank you.
Operator
That is all the time we have for questions at this point. I will turn the conference back over to the presenters.
Julie Dill - Duke Energy Corporation - VP of Investor & Shareholder Relations
Thank you, Audrey. And thanks everyone for joining us today. As always, our IR team here is happy to take whatever follow-up questions you
have, so thanks again. Have a good day.
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Q4 2005 Duke Energy Corporation Earnings Conference Call & 2006 Outlook February 1, 2006
Operator
That does conclude today's conference call. We do thank you for your participation.
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