Duke Energy Corporation (Holding Company) · NYSE:DUK
Duke Energy Corporation (Holding Company) — Q2 2004 Earnings Presentation
21 slides from Duke Energy Corporation (Holding Company)'s earnings presentation, Jul 29, 2004
Slide 1: Second Quarter 2004 Earnings Review
Second Quarter 2004 Earnings Review July 29, 2004 Paul Anderson Chairman and Chief Executive Officer David Hauser Group Vice President and Chief Financial Officer
Slide 2: Safe Harbor Statement
Safe Harbor Statement Under the Private Securities Litigation Act of 1995 This document contains forward looking information which is subject to risks and uncertainties, including, but not limited to, changes in the utility regulatory environment, the impact of competition from other energy supplier
Slide 3: Second Quarter Highlights
Second Quarter Highlights 2Q04 2Q03 Reported EPS $ 0.46 $ 0.46 Special Items (0.04) (0.16) EPS excluding special items $ 0.42 $ 0.30 ■ Key Events for Second Quarter 2004 ● Regulated businesses continue to deliver solid earnings and strong cash flow ● Field Services benefited from strong NGL prices a
Slide 4: Franchised Electric
Franchised Electric ■ Second Quarter 2004 Segment EBIT ($ millions) ● Favorable weather increased sales to residential and Quarter 2Q04 2Q03 commercial customers but Reported were partially offset by lower Segment EBIT $ 338 $ 316 Special item (3) --- bulk power marketing sales Ongoing EBIT $ 335 $
Slide 5: Natural Gas Transmission
Natural Gas Transmission ■ Second Quarter 2004 Segment EBIT ($ millions) ● Benefited from business expansion projects and stronger operating results Quarter 2Q04 2Q03 at Gulfstream and Union Gas Reported ● Recognized a $9 million gain on sale Segment EBIT $ 311 $ 306 of gas inventory Special items (
Slide 6: Field Services
Field Services ■ Second Quarter 2004 Segment EBIT from continuing operations ($ millions) ● Favorable results for the quarter were primarily due to strong NGL prices Quarter 2Q04 2Q03 ● Other positive contributions from: Reported ● Lower operating expenses Segment EBIT $ 94 $ 53 ● New margins relate
Slide 7: Duke Energy North America
Duke Energy North America ■ Second Quarter 2004 Segment EBIT ($ millions) ● Increased losses from energy generation due to lower spark spreads were partially offset Quarter 2Q04 2Q03 by improved margins from structured contracts, Reported primarily gas Segment EBIT $ (39) $ 211 ● Lower depreciation
Slide 8: EBIT Analysis
Duke Energy North America EBIT Analysis ($ in millions) 2Q04 Actual Total Gross Margin from Accrual Portfolio $ 104 Expenses: O&M (82) Depreciation (39) General and administrative (46) Minority interest benefit 4 Other income 3 Total Expenses (160) Segment EBIT before special items and MTM change $
Slide 9: International Energy
International Energy ■ Second Quarter 2004 Segment EBIT from continuing operations ● Higher earnings from Latin American ($ millions) assets and lower operating expenses Quarter 2Q04 2Q03 ■ Second Quarter 2003 benefited from: Reported ● Favorable regulatory audit in Brazil Segment EBIT $ 68 $ 91 for
Slide 10: Crescent Resources
Crescent Resources ■ Second Quarter 2004 Segment EBIT from continuing operations ($ millions) ● Higher earnings from commercial land sales, Quarter 2Q04 2Q03 primarily at Potomac Yard Reported in Virginia Segment EBIT $ 87 $ 21 ● Increased residential developed lot sales Year-to-date 2004 2003 Repor
Slide 11: Progress Made on Financial Plans
Progress Made on Financial Plans 9 Debt reduction has reached approximately $1.7 billion as of June 30 $900 million in Australian debt (1) $350 million of Duke Energy trust preferred securities $250 million of Duke Energy trust preferred securities $200 million of Duke Energy retail notes
Slide 12: Liquidity Position
Liquidity Position (as of June 30, 2004) Duke Duke Energy Capital Other * Total TOTAL CREDIT FACILITIES CAPACITY $650 million $1,200 million $696 million $2.5 billion CP Outstanding $546 million n/a n/a $546 million LOC Outstanding n/a $618 million n/a $618 million Other Borrowings n/a n/a n/a n/a T
Slide 13: Progress Toward Year-end Goals
Progress Toward Year-end Goals ■ Financial plans ● Exceeded asset sales goal for the year ● Debt reductions underway and ahead of schedule for the year ● Ongoing EPS of 76¢ for first six months of 2004 ■ Continued progress at DENA toward reducing losses and mitigating risks ■ Other businesses are pe
Slide 14: Special items for the quarter
Special items for the quarter include: 2004 2003 Pre-Tax Tax EPS EPS ($ in Millions) Amount Effect Impact Impact Second quarter 2004 • Enron settlement (net of minority interest) $130 ($46) $0.09 • True-up on net gain on sale of International 38 (9) 0.03 Energy assets • California and western U.S. e
Slide 15: Special items for the first quarter
Special items for the first quarter include: Pre-Tax Tax 2004 EPS 2003 EPS ($ in Millions) Amount Effect Impact Impact First Quarter 2004 Gain on sale of Australian assets $256 ($18) $0.26 -- Net loss on sale of DENA assets, (359) 134 (0.25) -- primarily anticipated sale of southeast U.S. plants Gai
Slide 16: Special items EPS year-to-date impact
Special items EPS year-to-date impact: 2004 2003 First quarter $0.01 ($0.17) Second quarter 0.04 0.16 Impact of change in shares (0.01) -- outstanding Total EPS Impact $0.04 ($0.01) Year-to-date EPS, as reported $0.80 $0.71 Year-to-date EPS, ongoing * $0.76 $0.72 * Includes results from operations p
Slide 17: Anticipated cash proceeds and tax benefits from sale of DENA southeast plants
Duke Energy Corporation Anticipated cash proceeds and tax benefits from sale of DENA southeast plants and Moapa (in millions) Cash proceeds $ 657 Tax benefits 648 $ 1,305 Rounded $1,300
Slide 18: Debt reduction reconciliation
Duke Energy Corporation Debt reduction reconciliation - Estimated for calendar year 2004 (in millions) Low High Issuances of long-term debt, per condensed cash flow statement $ 112 $ 112 Payments for the redemption of long-term debt, preferred stock of subsidiary and net paydown of commercial paper
Slide 19: Calendar year 2004 Estimated Capital Spending
Duke Energy Corporation Calendar year 2004 Estimated Capital Spending (in millions) Capital and investment expenditures, net of refund - presented as investing cash flows $ 2,254 Capital expenditures for Crescent residential real estate - presented as operating cash flows 242 $ 2,496 Rounded $ 2,500
Slide 20: Regulation G Reconciliation Schedules
Duke Energy Corporation Regulation G Reconciliation Schedules Second Quarter 2004 Earnings Release 2004 DENA Segment EBIT The Company's prepared remarks related to the Second Quarter 2004 Earnings Review include a discussion of DENA's adjusted 2004 segment EBIT loss projection of $300 million. This
Slide 21: Duke Energy North America Reconciliation of Merchant Energy Gross Margin
Duke Energy North America Reconciliation of Merchant Energy Gross Margin and EBIT Analysis From the Earnings Release Supplemental Disclosures to the Earnings Release Slide Quarter-to-date June 30, 2004 ($ in millions) From quarterly from earnings supplemental release slide Merchant Energy Gross Marg