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Consolidated Edison, Inc. Reports 2004 Earnings
Increases Dividend For 31st Consecutive Year

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NEW YORK, Jan 27, 2005 /PRNewswire-FirstCall via COMTEX/ -- Consolidated Edison, Inc. (Con Edison) (NYSE: ED) today reported 2004 earnings from ongoing operations of $629 million or $2.67 a share, compared with earnings from ongoing operations of $649 million or $2.95 a share in 2003. Earnings from ongoing operations exclude the effect of non-cash, non-recurring charges totaling $80 million (after-tax) in 2004 related to the company's new electric, gas and steam rate plans and $12 million (after-tax) in 2003 related to impairment charges for certain unregulated generating assets, the impact of a regulatory settlement and the cumulative effect of changes in accounting principles. Also excluded from these results are losses from the discontinued operations of Con Edison Communications, reflecting a December 2004 agreement to sell the telecommunications company. Including these items, net income for common stock for 2004 was $537 million or $2.28 a share compared with $528 million or $2.39 a share in 2003.

For the fourth quarter of 2004, the company's earnings from ongoing operations were $117 million or $0.49 a share compared with $152 million or $0.67 a share for the fourth quarter of 2003. Including the items noted above, net income for common stock was $51 million or $0.21 a share compared with $50 million or $0.21 a share in the 2003 period.

"In 2004, we were at or near the end of our multi-year rate plans. With new rate plans in place or close to approval, we are confident that we will have the financial strength and flexibility we need to continue to meet our customers' growing energy needs with the highest levels of reliability," said Eugene R. McGrath, chairman and chief executive officer.

Con Edison expects its earnings for 2005 to be in the range of $2.75 to $2.90 a share. The forecast reflects the multi-year rate plans for gas and steam that took effect in October 2004 and a three-year electric rate plan that, subject to PSC approval, is expected to take effect in April 2005.

The company also declared a quarterly dividend of 57 cents a share on its common stock, payable March 15, 2005 to shareholders of record as of February 16, 2005, an annualized increase of 2 cents over the previous annual dividend of $2.26 a share. This represents the company's 31st consecutive annual increase in its dividend to shareholders. "We recognize the importance of dividends to all of our investors," said Joan S. Freilich, executive vice president and chief financial officer. "We focus on steady dividend growth, consistent with maintaining our strong financial position."

The following table is a reconciliation of Con Edison's reported net income for common stock and reported earnings per share to earnings and earnings per share from ongoing operations.

                             For the year               For the quarter
                             ended December 31,         ended December 31,

                          Earnings      Earnings     Earnings       Earnings
                                        per share                   per share
    (Million of Dollars,
     except earnings
     per share)         2004   2003   2004*  2003   2004   2003   2004*   2003

    Reported net
     income for
     common stock
     and earnings
     per share -
     GAAP Basis        $537    $528  $2.28  $2.39    $51    $50  $0.21  $0.21
    One-time rate
     plan charges        80       -   0.34      -     65      -   0.27      -
    Discontinued
     operations of
     Con Edison
     Communications**    12     109   0.05   0.50      1     90   0.01   0.40
    Unregulated
     generating asset
     impairments          -      10      -   0.05      -     10      -   0.05
    Settlement regarding
     nuclear generating
     unit sold in 2001    -       5      -   0.03      -      5      -   0.03
    Cumulative effect
     of changes in
     accounting
     principles           -      (3)     -  (0.02)     -     (3)     -  (0.02)
    Ongoing operations $629    $649  $2.67  $2.95   $117   $152  $0.49  $0.67

    * The earnings per share variations shown above include the dilutive
      effect of higher weighted average number of common shares outstanding in
      the three months and the year ended December 31, 2004.

    ** The 2003 amounts include an after-tax impairment charge of $84 million,
       or $0.38 per share.

The following table represents an analysis of the major factors affecting Con Edison's earnings per share from ongoing operations for the year and fourth quarter of 2004 compared with the 2003 periods:

                                                                       4th
                                                             Year     quarter
                                                           2004 vs.   2004 vs.
                                                             2003       2003
    Con Edison of New York:
         Impact of weather in 2004 on net revenues versus
          2003 (estimated)                                  $(0.02)   $(0.01)
         Sales growth and other revenue factors
          (estimated)                                         0.15      0.08
         Increased pension & other post-retirement
          benefit costs                                      (0.08)    (0.03)
         Regulatory accounting                               (0.05)    (0.08)
         Higher depreciation and property tax expense        (0.13)    (0.04)
         Higher operations and maintenance expense           (0.11)    (0.10)
         Lower interest expense, primarily on long-term
          debt                                                0.06      0.03
         Allowance for funds used during construction and
          other income                                        0.09      0.01
         Other                                               (0.07)    (0.03)
    Total Con Edison of New York                             (0.16)    (0.17)
    Orange and Rockland Utilities                            (0.02)        -
    Con Edison Development                                   (0.01)        -
    Con Edison Energy                                            -         -
    Con Edison Solutions                                     (0.08)    (0.02)
    Other (parent and inter-company accounting)              (0.01)     0.01
    Total earnings per share variation from ongoing
     operations                                             $(0.28)   $(0.18)

The earnings per share from ongoing operations variations shown above include the dilutive effect of higher weighted average number of common shares outstanding in the three months and the year ended December 31, 2004. The weighted average numbers of common shares were 242 million shares and 236 million shares for the three months and year ended December 31, 2004, compared with 226 million shares and 221 million shares in the 2003 periods, respectively. The dilutive effect on earnings per share from ongoing operations for the three months and year ended December 2004 is $0.03 and $0.18, respectively. These amounts per share do not reflect the offsetting benefits of avoided interest expense.

The company's earnings for the fourth quarter of 2004 reflect the new gas and steam rate increases, partially offset by warm fall weather. The lower fourth quarter and year-end results also include a reduction in net credits for pensions and other post-retirement benefits and higher operations and maintenance expense, principally related to work we are doing to improve the safety of steam manholes. In addition, higher depreciation and property taxes in 2004 reflect large continuing investments in energy delivery infrastructure.

The results for the unregulated energy businesses in 2004 reflect lower gross margins on wholesale and retail electric sales and higher costs related to generating plants placed in service in mid-2003, offset in part by higher mark-to-market gains on forward transactions.

Amounts of electricity and firm gas delivered by Con Edison of New York, after adjusting for variations in weather and billing days in the period, increased 1.4 percent and 0.6 percent, respectively, in 2004, while steam deliveries decreased 0.4 percent, as compared with the 2003 period. The 2003 amounts were also adjusted for the August 2003 regional power outage.

Construction expenditures are estimated at $1.6 billion per year for 2005 and 2006 and $1.7 billion for 2007, compared with $1.3 billion in 2004. Virtually all of the estimated construction expenditures are for the company's regulated utilities. The company does not expect to issue new equity in 2005, other than an estimated $95 million to be issued through its dividend reinvestment and employee stock plans.

This press release contains certain forward-looking statements of future expectations and financial measures not determined in accordance with Generally Accepted Accounting Principles (non-GAAP) financial measures. Actual results might differ materially from those projected in the forward looking statements because of factors such as those identified in reports the company has filed with the Securities and Exchange Commission. "Earnings from ongoing operations" excludes the impact of unusual items. Earnings from ongoing operations should not be considered as an alternative to net income, which is an indicator of operating performance determined in accordance with GAAP. Management uses earnings and earnings per share from ongoing operations to facilitate the analysis of the company's ongoing performance as compared to its internal budgets and previously reported financial results. Management believes that earnings from ongoing operations, although a non-GAAP measure, are also useful and meaningful to investors. Other companies may use different measures to present financial performance.

Refer to the attachments to this press release for the condensed consolidated balance sheets at December 31, 2004 and 2003 and the consolidated income statements for 2004 and 2003. For additional information related to utility sales and revenues go to the Con Edison Web site at http://www.conedison.com, select "Investor Information" and then select "Financial Reports."

Consolidated Edison, Inc. is one of the nation's largest investor-owned energy companies, with $10 billion in annual revenues and approximately $23 billion in assets. The company provides a wide range of energy-related products and services to its customers through the following subsidiaries: Consolidated Edison Company of New York, Inc., a regulated utility providing electric, gas, and steam service in New York City and Westchester County, New York; Orange and Rockland Utilities, Inc., a regulated utility serving customers in a 1,350 square mile area in southeastern New York state and adjacent sections of northern New Jersey and northeastern Pennsylvania; Con Edison Solutions, a retail energy supply and services company; Con Edison Energy, a wholesale energy supply company; and Con Edison Development, a company that owns and operates generating plants and participates in other infrastructure projects.

Attachment A
                            CONSOLIDATED EDISON, INC.
                     CONSOLIDATED BALANCE SHEET (Condensed)
                                   (UNAUDITED)


                                         December 31, 2004   December 31, 2003
    ASSETS                                      (Millions of Dollars)
    PLANT, AT ORIGINAL COST
      Utility plant - net                          $15,168           $14,284
      Non-utility plant - net                          873               941
      Non-utility plant assets held for sale            65               -
    NET PLANT                                       16,106            15,225

    CURRENT ASSETS
      Cash and temporary cash investments               26                49
      Accounts receivable - customers, less
       allowance for uncollectible accounts            760               798
      Other receivables, less allowance for
       uncollectible accounts                          179               176
      Inventories                                      311               283
      Prepayments                                       93                98
      Current assets held for sale                       5               -
      Other current assets                             339               188
    TOTAL CURRENT ASSETS                             1,713             1,592

    INVESTMENTS                                        257               248

    DEFERRED CHARGES, REGULATORY ASSETS
     AND NONCURRENT ASSETS
      Goodwill                                         406               406
      Intangible assets - net                          100               111
      Prepaid pension costs                          1,442             1,257
      Regulatory assets                              2,262             1,861
      Other deferred charges and noncurrent assets     271               266
    TOTAL DEFERRED CHARGES, REGULATORY
     ASSETS AND NONCURRENT ASSETS                    4,481             3,901
    TOTAL ASSETS                                   $22,557           $20,966

    CAPITALIZATION AND LIABILITIES
     CAPITALIZATION
      Common shareholders' equity                   $7,054            $6,423
      Preferred stock of subsidiary                    213               213
      Long-term debt                                 6,561             6,733
    TOTAL CAPITALIZATION                            13,828            13,369

    NONCURRENT LIABILITIES
      Provision for injuries and damages               180               194
      Pensions and retiree benefits                    207               205
      Superfund and other environmental
       costs                                           198               193
      Noncurrent liabilities held for sale               5               -
      Other noncurrent liabilities
       including minority interests                    134               157
    TOTAL NONCURRENT LIABILITIES                       724               749

    CURRENT LIABILITIES
      Long-term debt due within one year               469               166
      Notes payable                                    156               159
      Accounts payable                                 923               905
      Customer deposits                                234               228
      Current liabilities held for sale                 11               -
      Other current liabilities                        434               453
    TOTAL CURRENT LIABILITIES                        2,227             1,911

    DEFERRED CREDITS AND REGULATORY LIABILITIES
      Deferred income taxes and investment
       tax credits                                   3,726             3,172
      Regulatory liabilities and other
       deferred credits                              2,052             1,765
    TOTAL DEFERRED CREDITS AND REGULATORY
     LIABILITIES                                     5,778             4,937
    TOTAL CAPITALIZATION AND LIABILITIES           $22,557           $20,966


                                                                  Attachment B
                            Consolidated Edison, Inc.
                          CONSOLIDATED INCOME STATEMENT
                                   (Unaudited)

                                           For the Three
                                            Months Ended      For the Years
                                            December 31,    Ended December 31,
                                           2004     2003     2004     2003
                                       (Millions of Dollars/Except Share Data)
    OPERATING REVENUES
         Electric                          $1,414   $1,559   $6,652   $6,863
         Gas                                  396      362    1,507    1,492
         Steam                                134      107      550      537
         Non-utility                          237      245    1,049      916
    TOTAL OPERATING REVENUES                2,181    2,273    9,758    9,808
    OPERATING EXPENSES
         Purchased power                      926      895    3,961    3,884
         Fuel                                 130       87      597      504
         Gas purchased for resale             209      231      852      889
         Other operations and maintenance     373      327    1,494    1,438
         Impairment charges - unregulated
          assets                              -         18      -         18
         Depreciation and amortization        139      133      551      516
         Taxes, other than income taxes       265      267    1,080    1,116
         Income taxes                         (15)      71      292      399
    TOTAL OPERATING EXPENSES                2,027    2,029    8,827    8,764
    OPERATING INCOME                          154      244      931    1,044
    OTHER INCOME (DEDUCTIONS)
         Investment and other income            3       10       42       27
         Allowance for equity funds used
          during construction                   7        5       25       15
         Preferred stock dividend
          requirements of subsidiary           (3)      (3)     (11)     (11)
         Other deductions                      (4)      (3)     (14)     (16)
         Income taxes                           7        1       20        9
    TOTAL OTHER INCOME (DEDUCTIONS)            10       10       62       24
    INTEREST EXPENSE
         Interest on long-term debt           106      101      426      401
         Other interest                        11       20       36       45
         Allowance for borrowed funds
          used during construction             (5)      (4)     (18)     (12)
    NET INTEREST EXPENSE                      112      117      444      434
    INCOME FROM CONTINUING OPERATIONS          52      137      549      634
    LOSS FROM DISCONTINUED OPERATIONS
     (NET OF INCOME TAXES OF $1 AND $8 IN
     2004 AND $61 AND $74 IN 2003              (1)     (90)     (12)    (109)
    INCOME BEFORE CUMULATIVE EFFECT OF
     CHANGES IN ACCOUNTING PRINCIPLES          51       47      537      525
    CUMULATIVE EFFECT OF CHANGES IN
     ACCOUNTING PRINCIPLES (NET OF INCOME
     TAX OF $2 MILLION IN 2003 )              -          3      -          3
    NET INCOME                                $51      $50     $537     $528
    EARNINGS PER COMMON SHARE - BASIC
    Continuing operations                   $0.22    $0.59    $2.33    $2.87
    Discontinued operations                $(0.01)  $(0.40)   (0.05)   (0.50)
    Before cumulative effect of changes
     in accounting principles               $0.21    $0.19    $2.28    $2.37
    Cumulative effect of changes in
     accounting principles                  $ -      $0.02    $ -      $0.02
    After cumulative effect of changes in
     accounting principles                  $0.21    $0.21    $2.28    $2.39
    EARNINGS PER COMMON SHARE - DILUTED
    Continuing operations                   $0.22    $0.59    $2.32    $2.86
    Discontinued operations                $(0.01)  $(0.40)  $(0.05)  $(0.50)
    Before cumulative effect of changes
     in accounting principles               $0.21    $0.19    $2.27    $2.36
    Cumulative effect of changes in
     accounting principles                  $ -      $0.02    $ -      $0.02
    After cumulative effect of changes in
     accounting principles                  $0.21    $0.21    $2.27    $2.38
    AVERAGE NUMBER OF SHARES OUTSTANDING
     - BASIC  (IN MILLIONS)                 242.2    225.5    235.8    220.9
    AVERAGE NUMBER OF SHARES OUTSTANDING
     - DILUTED (IN MILLIONS)                242.9    226.5    236.4    221.8

SOURCE Consolidated Edison, Inc.

Michael Clendenin, Consolidated Edison, Inc., +1-212-460-4111

http://www.prnewswire.com

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