EX-99 2 uil_exh99.htm UIL EXHIBIT 99 - EARNINGS RELEASE uil_exh99.htm
EXHIBIT 99

UIL Holdings Corporation
157 Church Street
P.O. Box 1564
New Haven, CT  06506-0901
203.499.2812 Fax:  203.499.3626
 
UIL Press Release Logo

NEWS RELEASE

May 3, 2010
Analyst Contact:
Susan Allen:
203-499-2409
 
Media Contact:
Anita Steeves:
203-499-2901
   
After Hours:
203-499-2812

UIL Holdings Corporation Reports First Quarter 2010 Results and
Increases 2010 Earnings Guidance

UIL Holdings Corporation (NYSE: UIL) today reported consolidated net income of $16.1 million, or $0.53 per share for the first quarter of 2010, an increase of $4.1 million, or $0.05 per share, compared to the same period in 2009.  The dilutive effect from UIL’s May 2009 issuance of 4.6 million shares of common stock for the first quarter of 2010 was $0.10 per share.

“The first quarter 2010 results were favorably impacted by a previously approved distribution rate increase and the continued focus on managing our operating costs,” commented James P. Torgerson, UIL’s President and CEO.  “Decoupling of distribution revenues from electricity sales provided revenue stability in the first quarter and will result in revenue predictability throughout the rest of 2010.”

“On a separate note, GenConn Energy’s, a 50-50 joint venture between NRG Energy, Inc. and The United Illuminating Company, two peaking generation projects each with a nominal capacity of approximately 200 megawatts, are under construction at NRG’s existing plant locations in Devon and Middletown Connecticut.  The Devon plant is scheduled to be in commercial operation in June,” added Torgerson.

Net income for the first quarter of 2010, compared to the same period in 2009, by line of business, are as follows:

 
SEGMENTED CONSOLIDATED INCOME STATEMENT
 
                   
   
Quarter Ended March 31,
 
   
2010
   
2009
   
Difference
 
Net Income (Loss) ($M)
                 
UI
                 
Distribution, CTA and Other
  $ 9.9     $ 6.8     $ 3.1  
Transmission
    6.7       6.1       0.6  
Total UI Net Income
  $ 16.6     $ 12.9     $ 3.7  
                         
UIL Corporate
    (0.5 )     (0.9 )     0.4  
Total Net Income
  $ 16.1     $ 12.0     $ 4.1  
                         
Average Shares Outstanding - Basic
    30.0       25.2       4.8  
                         
EPS
  $ 0.53     $ 0.48     $ 0.05  
                         
The dilutive effect of the May 2009 issuance of 4,600,000 shares of common
         
 stock in the first quarter of 2010 was $0.10 per share.
                       


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The table below provides the distribution, competitive transition assessment (CTA) and other net income variances for the first quarter of 2010, compared to the same period in 2009.  Earnings from the distribution business have grown primarily due to the previously approved 2010 distribution rate increase effective January 1, 2010, partially offset by decreases in allocated customer service and uncollectibles expenses.
 
Distribution, CTA & Other Net Income
 
       
   
Quarter Ended
 
   
March 31, 2010
 
   
vs. 2009
 
Favorable/(Unfavorable)
 
(In Millions)
 
Operating revenues
     
Regulatory true-up items incl. decoupling adjustment
  $ (2.1 )
Distribution rates & pricing
    6.0  
Sales volume
    0.8  
Operation and maintenance (O&M) expense
       
Customer service - allocated
    (0.2 )
Uncollectibles
    (0.5 )
Depreciation and amortization
    (1.6 )
Other income and (deductions)
    1.6  
Interest expense
    (0.5 )
Other, net
    (0.4 )
    $ 3.1  
 
Transmission

The transmission business earnings continued to experience underlying growth in net income of $0.6 million in the first quarter of 2010, compared to the first quarter of 2009 primarily due to an increase in the allowance for funds used during construction, as well as higher rate base and equity capitalization with approximately the same allowed return of 12.3% to 12.5% compared to the first quarter of 2009.

UIL Corporate

UIL Corporate incurred net after-tax costs in the first quarter of 2010 of $0.5 million, compared to net after-tax costs of $0.9 million in the same period of 2009.  The decrease in the first quarter of 2010 after-tax costs was primarily due to a gain related to a legal claim settlement of a former subsidiary, as well as less interest expense due to lower long-term borrowings.

Looking Forward

UIL is increasing its consolidated earnings estimate for 2010 to $1.92 to $2.07 per share, compared to the previously reported estimate of $1.87 to $2.02 per share.

The revised estimate for total UI is $1.98 to $2.10 per share, compared to the previously reported estimate of $1.93 to $2.05 per share.

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The revised estimate for distribution, CTA & other is $1.02 to $1.09 per share, compared to the previously reported estimate of $0.98 to $1.05 per share. The change reflects better than anticipated first quarter earnings performance and the projected impact of cost control measures for the remainder of 2010.

The earnings estimates for transmission, GenConn and UIL Corporate expenses are all unchanged.


2010 Earnings Expectations
 
             
   
Approximate Net Income*
   
EPS
 
UI
           
Distribution, CTA & Other
  $ 31 - $33     $ 1.02 - $1.09  
Transmission
    26 - 28       0.85 - 0.93  
GenConn
    2 - 3       0.07 - 0.09  
                 
Total UI (1)
  $ 59 - $63     $ 1.98 - $2.10  
                 
UIL Corporate
    (3) - (2 )     (0.09) - (0.05
                 
Total UIL (1)
  $ 57 - $62     $ 1.92 - $2.07  
                 
(1) Expectations are not intended to be additive.
         
                 
* Rounded to nearest million
               
 
First Quarter Earnings Conference Call

In conjunction with this earnings release, UIL will conduct a webcast conference call with financial analysts on Tuesday, May 4, 2010, beginning at 10:00 a.m. eastern time.  UIL’s executive management will present an overview of the financial results followed by a question and answer session.  Interested parties, including analysts, investors and the media, may listen live via the internet by logging onto the Investors section of UIL’s website at http://www.uil.com. Institutional investors can access the call via Thomson Street Events (www.streetevents.com), a password-protected event management site.

UIL Holdings Corporation (NYSE:UIL), headquartered in New Haven, Connecticut, is the holding company for The United Illuminating Company, a regulated utility providing electricity and energy related services to 325,000 customers in the Greater New Haven and Bridgeport areas.  For more information on UIL Holdings, visit us at http://www.uil.com.

Use of Non-GAAP Measures for 2010 Earnings Guidance

UIL Holdings believes earnings per share (EPS) information as presented in its earnings guidance is useful in understanding the earnings expectations for the business, as a whole.  The amounts presented in the earnings guidance show the EPS for each of UIL Holdings’ lines of business.  EPS is calculated by dividing the projected 2010 net income for each line of business by the projected average number of shares of UIL Holdings common stock outstanding for 2010.   Total consolidated EPS is a generally accepted accounting principles (GAAP)-basis presentation.

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Certain statements contained herein, regarding matters that are not historical facts, are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995).  These include statements regarding management’s intentions, plans, beliefs, expectations or forecasts for the future.  Such forward-looking statements are based on UIL Holdings’ expectations and involve risks and uncertainties; consequently, actual results may differ materially from those expressed or implied in the statements.  Such risks and uncertainties include, but are not limited to, general economic conditions, legislative and regulatory changes, changes in demand for electricity and other products and services, unanticipated weather conditions, changes in accounting principles, policies or guidelines, and other economic, competitive, governmental, and technological factors affecting the operations, markets, products and services of UIL Holdings’ subsidiary, The United Illuminating Company.  The foregoing and other factors are discussed and should be reviewed in UIL Holdings’ most recent Annual Report on Form 10-K and other subsequent periodic filings with the Securities and Exchange Commission.  Forward-looking statements included herein speak only as of the date hereof and UIL Holdings undertakes no obligation to revise or update such statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events or circumstances.

The following are summaries of UIL Holdings’ unaudited consolidated financial information for the first quarter of 2010 and 2009:

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UIL HOLDINGS CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(In Thousands except per share amounts)
(Unaudited)
   
Three Months Ended
   
March 31,
   
2010
   
2009
           
Operating Revenues
  $ 220,280     $ 235,509
Operating Expenses
             
Operation
             
Purchased power
    75,348       103,567
Operation and maintenance
    51,621       52,507
Transmission wholesale
    15,476       12,467
Depreciation and amortization
    27,251       23,987
Taxes - other than income taxes
    17,704       14,494
Total Operating Expenses
    187,400       207,022
Operating Income
    32,880       28,487
               
Other Income and (Deductions), net
    4,056       1,471
               
Interest Charges, net
             
Interest on long-term debt
    9,877       8,392
Other interest, net
    281       491
      10,158       8,883
Amortization of debt expense and redemption premiums
    393       513
Total Interest Charges, net
    10,551       9,396
               
Income Before Income Taxes and Equity Earnings
    26,385       20,562
               
Income Taxes
    10,341       8,532
               
Income Before Equity Earnings
    16,044       12,030
Income (Loss) from Equity Investments
    8       12
Net Income
  $ 16,052     $ 12,042
               
Average Number of Common Shares Outstanding - Basic
    30,013       25,188
Average Number of Common Shares Outstanding - Diluted
    30,282       25,543
               
Earnings Per Share of Common Stock - Basic
  $ 0.53     $ 0.48
Earnings Per Share of Common Stock - Diluted
  $ 0.53     $ 0.47
               
Cash Dividends Declared per share of Common Stock
  $ 0.432     $ 0.432
               


 
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UIL HOLDINGS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
   
March 31,
   
December 31,
(thousands of dollars)
 
2010
   
2009
ASSETS
         
Current assets
  $ 226,030     $ 236,694
Other investments
    10,959       10,659
Net property, plant and equipment
    1,175,097       1,153,001
Regulatory assets
    600,321       676,428
Deferred Charges and Other Assets
    151,002       144,978
Total Assets
  $ 2,163,409     $ 2,221,760
               
               
               
LIABILITIES AND CAPITALIZATION
             
Current liabilities
  $ 242,896     $ 243,334
Noncurrent liabilities
    314,303       374,686
Deferred income taxes
    270,150       273,558
Regulatory liabilities
    81,803       82,457
Total Liabilities
    909,152       974,035
               
Long-term debt
    675,457       673,549
Net Common Stock Equity
    578,800       574,176
Total Capitalization
    1,254,257       1,247,725
               
Total Liabilities and Capitalization
  $ 2,163,409     $ 2,221,760

 
 
 
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