EX-99.2 3 k46844exv99w2.htm EX-99.2 EX-99.2
Exhibit 99.2
Third Quarter 2008 Supplemental Financial Information October 30, 2008


 

DTE Energy Company
Consolidated Statements of Financial Position (Unaudited)
                 
    September 30     December 31  
(in Millions)   2008     2007  
ASSETS
               
Current Assets
               
Cash and cash equivalents
  $ 223     $ 123  
Restricted cash
    36       140  
Accounts receivable (less allowance for doubtful accounts of $266 and $182, respectively)
               
Customer
    1,375       1,658  
Other
    320       514  
Accrued power and gas supply cost recovery revenue
    110       76  
Inventories
               
Fuel and gas
    564       429  
Materials and supplies
    206       204  
Deferred income taxes
    259       387  
Assets from risk management and trading activities
    331       181  
Other
    299       196  
Current assets held for sale
          83  
 
           
 
    3,723       3,991  
 
           
 
               
Investments
               
Nuclear decommissioning trust funds
    756       824  
Other
    538       446  
 
           
 
    1,294       1,270  
 
           
 
               
Property
               
Property, plant and equipment
    19,907       18,809  
Less accumulated depreciation and depletion
    (7,837 )     (7,401 )
 
           
 
    12,070       11,408  
 
           
 
               
Other Assets
               
Goodwill
    2,037       2,037  
Regulatory assets
    2,830       2,786  
Securitized regulatory assets
    1,035       1,124  
Intangible assets
    86       25  
Notes receivable
    114       87  
Assets from risk management and trading activities
    206       199  
Prepaid pension assets
    167       152  
Other
    126       116  
Noncurrent assets held for sale
          547  
 
           
 
    6,601       7,073  
 
           
 
               
Total Assets
  $ 23,688     $ 23,742  
 
           

1


 

DTE Energy Company
Consolidated Statements of Financial Position (Unaudited)
                 
    September 30     December 31  
(in Millions, Except Shares)   2008     2007  
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
Current Liabilities
               
Accounts payable
  $ 931     $ 1,189  
Accrued interest
    138       112  
Dividends payable
    87       87  
Short-term borrowings
    1,155       1,084  
Current portion long-term debt, including capital leases
    362       454  
Liabilities from risk management and trading activities
    411       281  
Deferred gains and reserves
    4       400  
Other
    505       566  
Current liabilities associated with assets held for sale
          48  
 
           
 
    3,593       4,221  
 
           
 
               
Long-Term Debt (net of current portion)
               
Mortgage bonds, notes and other
    6,158       5,576  
Securitization bonds
    933       1,065  
Trust preferred-linked securities
    289       289  
Capital lease obligations
    64       41  
 
           
 
    7,444       6,971  
 
           
 
               
Other Liabilities
               
Deferred income taxes
    1,951       1,824  
Regulatory liabilities
    1,168       1,168  
Asset retirement obligations
    1,325       1,277  
Unamortized investment tax credit
    99       108  
Liabilities from risk management and trading activities
    374       450  
Liabilities from transportation and storage contracts
    115       126  
Accrued pension liability
    68       68  
Accrued postretirement liability
    1,063       1,094  
Deferred gains
    12       15  
Nuclear decommissioning
    122       134  
Other
    313       303  
Noncurrent liabilities associated with assets held for sale
          82  
 
           
 
    6,610       6,649  
 
           
 
               
Commitments and Contingencies (Notes 2, 6 and 9)
               
 
               
Minority Interest
    45       48  
 
           
 
               
Shareholders’ Equity
               
Common stock, without par value, 400,000,000 shares authorized, 163,025,446 and 163,232,095 shares issued and outstanding, respectively
    3,172       3,176  
Retained earnings
    2,952       2,790  
Accumulated other comprehensive loss
    (128 )     (113 )
 
           
 
    5,996       5,853  
 
           
 
               
Total Liabilities and Shareholders’ Equity
  $ 23,688     $ 23,742  
 
           

2


 

DTE Energy Company
Consolidated Statements of Cash Flows (Unaudited)
                 
    Nine Months Ended  
    September 30  
(in Millions)   2008     2007  
Operating Activities
               
Net income
  $ 417     $ 716  
Adjustments to reconcile net income to net cash from operating activities:
               
Depreciation, depletion and amortization
    675       716  
Deferred income taxes
    280       90  
Gain on sale of non-utility assets
    (128 )     (897 )
Other asset (gains), losses and reserves, net
    12       14  
Gain on sale of interests in synfuel projects
    (31 )     (144 )
Partners’ share of synfuel project (gains) losses
    2       (161 )
Contributions from synfuel partners
    14       177  
Changes in assets and liabilities, exclusive of changes shown separately (Note 1)
    (223 )     281  
 
           
Net cash from operating activities
    1,018       792  
 
           
 
               
Investing Activities
               
Plant and equipment expenditures — utility
    (842 )     (750 )
Plant and equipment expenditures — non-utility
    (154 )     (206 )
Proceeds from sale of interests in synfuel projects
    84       329  
Refunds to synfuel partners
    (387 )     (81 )
Proceeds from sale of non-utility assets
    253       1,258  
Proceeds from sale of other assets, net
    21       39  
Restricted cash for debt redemptions
    104       52  
Proceeds from sale of nuclear decommissioning trust fund assets
    180       227  
Investment in nuclear decommissioning trust funds
    (202 )     (254 )
Other investments
    (105 )     (22 )
 
           
Net cash from (used for) investing activities
    (1,048 )     592  
 
           
 
               
Financing Activities
               
Issuance of long-term debt
    1,013        
Redemption of long-term debt
    (446 )     (340 )
Repurchase of long-term debt
    (238 )      
Short-term borrowings, net
    71       (62 )
Repurchase of common stock
    (16 )     (686 )
Dividends on common stock
    (258 )     (278 )
Other
    (7 )     (2 )
 
           
Net cash from (used for) financing activities
    119       (1,368 )
 
           
 
               
Net Increase in Cash and Cash Equivalents
    89       16  
Cash and Cash Equivalents Reclassified (to) from Assets Held for Sale
    11       (7 )
Cash and Cash Equivalents at Beginning of Period
    123       147  
 
           
Cash and Cash Equivalents at End of Period
  $ 223     $ 156  
 
           

3


 

The Detroit Edison Company
Consolidated Statements of Operations (Unaudited)
                                 
    Three Months Ended     Nine Months Ended  
    September 30     September 30  
(in Millions)   2008     2007     2008     2007  
Operating Revenues
  $ 1,440     $ 1,403     $ 3,766     $ 3,707  
 
                       
 
                               
Operating Expenses
                               
Fuel and purchased power
    586       518       1,403       1,274  
Operation and maintenance
    292       386       1,019       1,114  
Depreciation and amortization
    193       203       563       583  
Taxes other than income
    54       63       176       204  
Asset (gains) and reserves, net
    (1 )     6       (1 )     12  
 
                       
 
    1,124       1,176       3,160       3,187  
 
                       
 
                               
Operating Income
    316       227       606       520  
 
                       
 
                               
Other (Income) and Deductions
                               
Interest expense
    73       73       220       222  
Interest income
    (1 )     (2 )     (3 )     (5 )
Other income
    (16 )     (8 )     (39 )     (26 )
Other expenses
    11       7       34       22  
 
                       
 
    67       70       212       213  
 
                       
 
                               
Income Before Income Taxes
    249       157       394       307  
 
                               
Income Tax Provision
    90       50       143       100  
 
                       
Reported Earnings
    159       107       251       207  
 
                       
 
                               
Adjustments
                               
Effective tax rate normalization
          (1 )           1  
Regulatory asset surcharge
                      6  
Detroit Thermal Reserve
          8             14  
 
                       
 
          7             21  
 
                       
 
                               
Operating Earnings
  $ 159     $ 114     $ 251     $ 228  
 
                       

4


 

MICHIGAN CONSOLIDATED GAS COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                                 
    Three Months Ended     Nine Months Ended  
    September 30     September 30  
(in Millions)   2008     2007     2008     2007  
Operating Revenues
  $ 232     $ 169     $ 1,509     $ 1,335  
 
                       
Operating Expenses
                               
Cost of gas
    102       56       956       827  
Operation and maintenance
    93       104       364       324  
Depreciation and amortization
    25       25       75       70  
Taxes other than income
    9       13       34       42  
Asset (gains) and losses, net
    (2 )     (1 )     (2 )     2  
 
                       
 
    227       197       1,427       1,265  
 
                       
Operating Income (Loss)
    5       (28 )     82       70  
 
                       
Other (Income) and Deductions
                               
Interest expense
    16       16       46       43  
Interest income
    (2 )     (5 )     (6 )     (12 )
Other income
    (2 )     (2 )     (8 )     (7 )
Other expenses
    4       1       9       3  
 
                       
 
    16       10       41       27  
 
                       
Income (Loss) Before Income Taxes
    (11 )     (38 )     41       43  
Income Tax Provision (Benefit)
    (3 )     (10 )     12       11  
 
                       
Reporting Earnings (Loss)
  $ (8 )   $ (28 )   $ 29     $ 32  
 
                       
 
                               
Adjustments
                               
Effective tax rate normalization
          6             4  
Performance Excellence Process
    2       1       3       3  
 
                       
 
    2       7       3       7  
 
                       
Operating Earnings
  $ (6 )   $ (21 )   $ 32     $ 39  
 
                       

5


 

(DTE ENERGY LOGO)
DTE Energy Debt/Equity Calculation
As of September 30, 2008
($ millions)
         
Short-term borrowings
  $ 1,155  
Current portion of long-term debt, including capital leases
    362  
Mortgage bonds, notes and other
    6,158  
Securitization bonds
    933  
Capital lease obligations
    64  
less MichCon short-term debt
    (401 )
less Securitization bonds, including current portion
    (1,065 )
 
     
Total debt
    7,207  
 
       
Trust preferred-linked securities
    289  
 
     
Total preferred/ other
    289  
 
       
Equity
    5,996  
 
       
 
     
Total capitalization
  $ 13,492  
 
     
 
       
Debt
    53.4 %
Preferred
    2.1 %
Common shareholders’ equity
    44.4 %
 
     
 
       
Total
    100.0 %
 
     


 

(LOGO DTE ENERGY)
Sales Analysis — Q3 2008
Electric Sales — Detroit Edison Service Area (GWh)
                         
    Q3 2008   Q3 2007   % Change
     
Residential
    4,595       4,836       -5 %
Commercial
    5,072       5,166       -2 %
Industrial
    3,327       3,278       1 %
Other
    789       811       -3 %
     
 
    13,783       14,091       -2 %
Choice*
    329       569       -42 %
     
TOTAL SALES
    14,112       14,660       -4 %
     
 
*   Includes Dearborn Industrial Group sales
Electric Revenue — Detroit Edison Service Area ($000s)
                         
    Q3 2008   Q3 2007   % Change
     
Residential
    520,453       522,327       0 %
Commercial
    477,917       445,809       7 %
Industrial
    229,805       214,993       7 %
Other
    45,626       44,823       2 %
     
 
    1,273,801       1,227,952       4 %
Choice*
    8,711       11,595       -25 %
     
TOTAL REVENUES
    1,282,512       1,239,547       3 %
     
 
*   Distribution charge, includes Dearborn Industrial Group revenues
Gas Sales — MichCon Service Area (Mcf)
                         
    Q3 2008   Q3 2007   % Change
     
Residential
    7,503       8,620       -13 %
Commercial
    2,408       2,303       5 %
Industrial
    127       185       -31 %
     
 
    10,038       11,108       -10 %
 
                       
End User Transportation*
    23,024       25,189       -9 %
     
TOTAL SALES
    33,062       36,297       -9 %
     
 
*   Includes choice customers
Gas Revenue — MichCon Service Area ($000s)
                         
    Q3 2008   Q3 2007   % Change
     
Residential
    117,390       109,517       7 %
Commercial
    35,619       27,198       31 %
Industrial
    1,612       1,867       -14 %
     
 
    154,621       138,582       12 %
 
                       
End User Transportation*
    21,496       21,308       1 %
     
TOTAL REVENUES
    176,117       159,890       10 %
     
 
*   Includes choice customers
Weather
Cooling Degree Days
Detroit Edison service territory
                         
    Q3 2008   Q3 2007   % Change
     
Actuals
    556       613       -9 %
Normal
    537       537          
             
 
                       
Deviation from normal
    3 %     14 %        
Heating Degree Days
MichCon service territory
                         
    Q3 2008   Q3 2007   % Change
     
Actuals
    80       107       -25 %
Normal
    175       181          
             
 
                       
Deviation from normal
    -54 %     -41 %        
Earnings Impact of Weather
Variance from normal weather ($millions, after-tax)
                 
    Q3 2008   Q3 2007
     
Detroit Edison
    2       12  
MichCon
    (1 )     (2 )
Warmer than normal weather added $2 million to Detroit Edison’s earnings in Q3 2008
Milder weather reduced MichCon’s earnings by $1M Q3 2008


 

(DTE ENERGY LOGO)
DTE Energy Company
Consolidated Statements of Operations (unaudited)
(Reconciliation of Reported Earnings to Operating earnings)
                         
    Three Months Ended September 30, 2008  
    3Q 2008 Reported     Operating     3Q 2008 Operating  
(in Millions)   Earnings     Adjustments     Earnings  
Operating Revenues
  $ 2,338     $ 3     $ 2,341  
 
                       
Operating Expenses
                       
Fuel, purchased power and gas
    1,034               1,034  
Operation and maintenance
    628       (4 )     624  
Depreciation, depletion and amortization
    235               235  
Taxes other than income
    71               71  
Gain on sale of non-utility business
                   
Other asset (gains) and losses, reserves and impairments, net
    (5 )             (5 )
 
                 
 
    1,963       (4 )     1,959  
 
                 
 
                       
Operating Income
    375       7       382  
 
                 
 
                       
Other (Income) and Deductions
                       
Interest expense
    125               125  
Interest income
    (5 )             (5 )
Other income
    (34 )             (34 )
Other expenses
    22               22  
 
                 
 
    108             108  
 
                 
Income Before Income Taxes and Minority Interest
    267       7       274  
 
                       
Income Tax Provision
    97       3       100  
 
                       
Minority Interest
    1               1  
 
                 
 
                       
Income from Continuing Operations
    169       4       173  
 
                       
Discontinued Operations
                       
Income (loss) from discontinued operations, net of tax
    8       (8 )      
Minority interest in discontinued operations
                       
 
                 
 
    8       (8 )      
 
                 
 
                       
 
                     
Net Income
  $ 177     $ (4 )   $ 173