DUKE ENERGY CORPORATION Duke Energy Corporation
Non-GAAP Reconciliations
Fourth Quarter Earnings Review & Business Update
February 13, 2020
Adjusted Earnings per Share (EPS)
The materials for Duke Energy Corporation's (Duke Energy) Fourth Quarter Earnings Review and Business Update on February 13, 2020, include a discussion of adjusted EPS for the year-to-date periods ended December 31, 2019, 2018 and 2017.
The non-GAAP financial measure, adjusted EPS, represents basic and diluted EPS from continuing operations available to Duke Energy Corporation common stockholders, adjusted for the per share impact of special items. As discussed below, special items represent certain charges and credits, which management believes are not indicative of Duke Energy's ongoing performance.
Management believes the presentation of adjusted EPS provides useful information to investors, as it provides them with an additional relevant comparison of Duke Energy's performance across periods. Management uses this non-GAAP financial measure for planning and forecasting and for reporting financial results to the Duke Energy Board of Directors (Board of Directors), employees, stockholders, analysts and investors. Adjusted EPS is also used as a basis for employee incentive bonuses. The most directly comparable GAAP measure for adjusted EPS is reported basic and diluted EPS available to Duke Energy Corporation common stockholders. Reconciliations of adjusted EPS for the year-to-date periods ended December 31, 2019, 2018 and 2017, to the most directly comparable GAAP measures are included herein.
Special items for the year-to-date periods ended December 31, 2019, 2018 and 2017, include the following items, which management believes do not reflect ongoing costs:
- Impairment Charges in 2019 represents a reduction of a prior-year impairment at Citrus County CC and an other-than-temporary-impairment on the remaining investment in Constitution Pipeline Company, LLC. For 2018, it represents an impairment at Citrus County CC, a goodwill impairment at Commercial Renewables and an other-than-temporary impairment of an investment in Constitution Pipeline Company, LLC. For 2017, the charges represent goodwill and other-than-temporary asset impairments at Commercial Renewables. For 2017, it represents charges related to the Levy nuclear project in Florida and the Mayo Zero Liquid Discharge and Sutton combustion turbine projects in North Carolina.
- Costs to Achieve Mergers represents charges that resulted from strategic acquisitions.
- Regulatory and Legislative Impacts in 2018 represents charges related to Duke Energy Progress and Duke Energy Carolinas North Carolina rate case orders and the repeal of the South Carolina Base Load Review Act.
- Sale of Retired Plant represents the loss associated with selling Beckjord, a nonregulated generating facility in Ohio.
- Impacts of the Tax Act represents amounts recognized related to the Tax Act.
- Severance Charges relate to companywide initiatives, excluding merger integration, to standardize processes and systems, leverage technology and workforce optimization.
Adjusted EPS Guidance
The materials for Duke Energy's Fourth Quarter Earnings Review and Business Update on February 13, 2020, include a reference to the forecasted 2020 adjusted EPS guidance range of $5.05 to $5.45 per share and the midpoint of forecasted 2020 adjusted EPS guidance range of $5.25. The materials also reference the long-term range of annual growth of 4% - 6% through 2024 off the original midpoint of 2019 adjusted EPS guidance range of $5.00. The forecasted adjusted EPS is a non-GAAP financial measure as it represents basic EPS from continuing operations available to Duke Energy Corporation common stockholders, adjusted for the per share impact of special items (as discussed above under Adjusted EPS). Due to the forward-looking nature of this non-GAAP financial measure for future periods, information to reconcile it to the most directly comparable GAAP financial measure is not available at this time, as management is unable to project all special items for future periods, such as legal settlements, the impact of regulatory orders or asset impairments.
For the years ended December 31, 2018 and 2019, Basic EPS Available to Duke Energy Corporation common stockholders and Diluted EPS Available to Duke Energy Corporation common stockholders were equal. Beginning in 2020, Duke Energy will use adjusted basic EPS as the financial measure to evaluate management performance. Adjusted basic EPS will represent Basic EPS Available to Duke Energy Corporation common stockholders (GAAP reported Basic EPS), adjusted for the per-share impact of special items.
Adjusted Segment Income and Adjusted Other Net Loss
The materials for Duke Energy's Fourth Quarter Earnings Review and Business Update on February 13, 2020, include a discussion of adjusted segment income and adjusted other net loss for the year-to-date periods ended December 31, 2019 and 2018, and a discussion of 2019 and 2020 forecasted adjusted segment income and forecasted adjusted other net loss.
Adjusted segment income and adjusted other net loss are non-GAAP financial measures, as they represent reported segment income and other net loss adjusted for special items (as discussed above under Adjusted EPS). Management believes the presentation of adjusted segment income and adjusted other net expense provides useful information to investors, as it provides an additional relevant comparison of a segment's or Other's performance across periods. When a per share impact is provided for a segment income driver, the after-tax driver is derived using the pretax amount of the item less income taxes based on the segment statutory tax rate of 24% for Electric Utilities and Infrastructure, 23% for Gas Utilities and Infrastructure and Other, or an effective tax rate for Commercial Renewables. The after-tax earnings drivers are divided by the Duke Energy weighted average shares outstanding for the period. The most directly comparable GAAP measures for adjusted segment income and adjusted other net loss are reported segment income and other net loss, which represents segment income and other net loss from continuing operations, including any special items. A reconciliation of adjusted segment income and adjusted other net loss for the year-to-date periods ended December 31, 2019 and 2018, to the most directly comparable GAAP measures is included herein. Due to the forward-looking nature of any forecasted adjusted segment income and forecasted other net loss and any related growth rates for future periods, information to reconcile these non-GAAP financial measures to the most directly comparable GAAP financial measures are not available at this time, as the company is unable to forecast all special items, as discussed above under Adjusted EPS guidance.
Effective Tax Rate Including Impacts of Noncontrolling Interests and Preferred Dividends and Excluding Special Items
The materials for Duke Energy's Fourth Quarter Earnings Review and Business Update on February 13, 2020, include a discussion of the effective tax rate including impacts of noncontrolling interests and preferred dividends and excluding special items for the year-to-date periods ended December 31, 2019. The materials also include a discussion of the 2019 and 2020 forecasted effective tax rate including impacts of noncontrolling interests and preferred dividends and excluding special items. Effective tax rate including impacts of noncontrolling interests and preferred dividends and excluding special items is a non-GAAP financial measure as the rate is calculated using pretax income and income tax expense, both adjusted for the impact of special items, noncontrolling interests and preferred dividends. The most directly comparable GAAP measure is reported effective tax rate, which includes the impact of special items and excludes the impacts of noncontrolling interests and preferred dividends. A reconciliation of this non-GAAP financial measure for the year-to-date periods ended December 31, 2019, to the most directly comparable GAAP measure is included herein. Due to the forward-looking nature of the forecasted effective tax rates including impacts of noncontrolling interests and preferred dividends and excluding special items, information to reconcile it to the most directly comparable GAAP financial measure is not available at this time, as management is unable to project all special items, as discussed above under Adjusted EPS Guidance.
Available Liquidity
The materials for Duke Energy's Fourth Quarter Earnings Review and Business Update on February 13, 2020, include a discussion of Duke Energy's available liquidity balance. The available liquidity balance presented is a non-GAAP financial measure as it represents cash and cash equivalents, excluding certain amounts held in foreign jurisdictions and cash otherwise unavailable for operations, and remaining availability under Duke Energy's available credit facilities, including the master credit facility. The most directly comparable GAAP financial measure for available liquidity is cash and cash equivalents. A reconciliation of available liquidity as of December 31, 2019, to the most directly comparable GAAP measure is included herein.
Non-Rider Recoverable O&M
The materials for Duke Energy's Fourth Quarter Earnings Review and Business Update on February 13, 2020, include a discussion of Duke Energy's non-rider recoverable operating, maintenance and other expenses (O&M) for the year-to-date periods ended December 31, 2019, 2018, 2017 and 2016 as well as the forecasted year-to-date period ended December 31, 2020. Non-rider recoverable O&M expenses are non- GAAP financial measures, as they represent reported O&M expenses adjusted for special items and expenses recovered through riders. The most directly comparable GAAP financial measure for non-rider recoverable O&M expenses is reported operating, maintenance and other expenses. A reconciliation of non- rider recoverable O&M expenses for the year-to-date periods ended December 31, 2019, 2018, 2017, and 2016, as well as the forecasted year-to-date period ended December 31, 2020, to the most directly comparable GAAP measure are included here-in. Due to the forward-looking nature of this non-GAAP financial measure for future periods, information to reconcile it to the most directly comparable GAAP financial measure is not available at this time, as management is unable to project all special items, as discussed above under Adjusted ;EPS Guidance; However, projected rider recoverable O&M costs have been forecasted for the year ended December 31, 2020 and are presented in the reconciliation herein.
Dividend Payout Ratio
The materials for Duke Energy's Fourth Quarter Earnings Review and Business Update on February 13, 2020, include a discussion of Duke Energy's forecasted dividend payout ratio of 65% - 75% based upon adjusted EPS. This payout ratio is a non-GAAP financial measure as it is based upon forecasted basic EPS from continuing operations available to Duke Energy Corporation stockholders, adjusted for the per-share impact of special items, as discussed above under Adjusted EPS. The most directly comparable GAAP measure for adjusted EPS is reported basic EPS available to Duke Energy Corporation common stockholders. Due to the forward-looking nature of this non-GAAP financial measure for future periods, information to reconcile it to the most directly comparable GAAP financial measure is not available at this time, as management is unable to project all special items, as discussed above under Adjusted EPS Guidance.
The materials also reference the 2019 actual dividend payout ratio of 74%. This payout ratio is a non-GAAP financial measure as it is the annualized Q4 2019 dividend divided by the 2019 adjusted EPS (as discussed above under Adjusted EPS Guidance). On an annualized basis, the Q4 2019 dividend of $0.9540 is equal to $3.78, which creates an annual dividend payout ratio of 74% when compared to 2019 adjusted EPS.
Adjusted Book Return on Equity (ROE)
The materials for Duke Energy's Fourth Quarter Earnings Review and Business Update on February 13,
2020 include a reference to the historical and projected adjusted book return on equity (ROE) ratio. This ratio is a non-GAAP financial measure. The numerator represents Net Income, adjusted for the impact of special items (as discussed above under Adjusted EPS). The denominator is average Total Common Stockholder's Equity, reduced for Goodwill. A reconciliation of the components of adjusted ROE to the most directly comparable GAAP measures is included here-in. Due to the forward-looking nature of this non-GAAP financial measure for future periods, information to reconcile it to the most directly comparable GAAP financial measure is not available at this time, as management is unable to project all special items, as discussed above under Adjusted EPS Guidance.
Funds From Operations ("FFO") Ratios
The materials for Duke Energy's Fourth Quarter Earnings Review and Business Update on February 13,
2020 include a reference to historical and expected FFO to Total Debt ratios. These ratios reflect non-GAAP financial measures. The numerator of the FFO to Total Debt ratio is calculated principally by using net cash provided by operating activities on a GAAP basis, adjusted for changes in working capital, ARO spend, depreciation and amortization of operating leases and reduced for capitalized interest (including any AFUDC interest) and AMT refunds. The denominator for the FFO to Total Debt ratio is calculated principally by using the balance of long-term debt (excluding purchase accounting adjustments and long-term debt associated with the CR3 Securitization), including current maturities, imputed operating lease liabilities, plus notes payable, commercial paper outstanding, underfunded pension, guarantees on joint-venture debt, and adjustments to hybrid debt and preferred equity issuances based on how credit rating agencies view the instruments. The calculation of FFO to Total Debt ratio for the year ended December 31, 2019 is included here-in. Due to the forward-looking nature of this non-GAAP financial measure for future periods, information to reconcile it to the most directly comparable GAAP financial measure is not available at this time, as management is unable to project all special items, as discussed above under Adjusted EPS Guidance.
Holdco Debt Percentage
The materials for Duke Energy's Fourth Quarter Earnings Review and Business Update on February 13,
2020 include a reference to a historical and projected Holdco debt percentage. This percentage reflects a non- GAAP financial measure. The numerator of the Holdco debt percentage is the balance of Duke Energy Corporate debt, Progress Energy, Inc. debt, PremierNotes and the Commercial Paper attributed to the Holding Company. The denominator for the percentage is the balance of long-term debt (excluding purchase accounting adjustments and long-term debt associated with the CR3 Securitization), including current maturities, imputed operating lease liabilities, plus notes payable and commercial paper outstanding
Business Mix Percentage
The materials for Duke Energy's Fourth Quarter Earnings Review and Business Update on February 13, 2020, reference each segment's 2020 projected adjusted segment income as a percentage of the total projected 2020 adjusted net income (i.e. business mix), excluding the impact of Other. Duke Energy's segments are comprised of Electric Utilities and Infrastructure, Gas Utilities and Infrastructure and Commercial Renewables.
Adjusted segment income is a non-GAAP financial measure, as it represents reported segment income adjusted for special items as discussed above. Due to the forward-looking nature of any forecasted adjusted segment income, information to reconcile this non-GAAP financial measure to the most directly comparable GAAP financial measure is not available at this time, as management is unable to project all special items (as discussed above under Adjusted EPS Guidance).
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DUKE ENERGY CORPORATION
REPORTED TO ADJUSTED EARNINGS RECONCILIATION
Twelve Months Ended December 31, 2017
(Dollars in millions, except per-share amounts)
Special Items | ||||||||||||||||||||||||||||
Costs to | Commercial | |||||||||||||||||||||||||||
Reported | Achieve | Regulatory | Impacts of | Discontinued | Total | Adjusted | ||||||||||||||||||||||
Piedmont | Renewables | |||||||||||||||||||||||||||
Earnings | Merger | Settlements | Impairments | the Tax Act | Operations | Adjustments | Earnings | |||||||||||||||||||||
SEGMENT INCOME | ||||||||||||||||||||||||||||
Electric Utilities and Infrastructure | $ | 3,210 | $ | - | $ | 98 B | $ | - | $ | (231) | $ | - | $ | (133) | $ | 3,077 | ||||||||||||
Gas Utilities and Infrastructure | 319 | - | - | - | (26) D | - | (26) | 293 | ||||||||||||||||||||
Commercial Renewables | 441 | - | - | 74 | C | (442) | - | (368) | 73 | |||||||||||||||||||
Total Reportable Segment Income | 3,970 | - | 98 | 74 | (699) | - | (527) | 3,443 | ||||||||||||||||||||
Other | (905) | 64 | A | - | - | 597 | - | 661 | (244) | |||||||||||||||||||
Discontinued Operations | (6) | - | - | - | - | 6 | E | 6 | - | |||||||||||||||||||
Net Income Attributable to Duke Energy | $ | 3,059 | $ | 64 | $ | 98 | $ | 74 | $ | (102) | D $ | 6 | $ | 140 | $ | 3,199 | ||||||||||||
Corporation | ||||||||||||||||||||||||||||
EPS ATTRIBUTABLE TO DUKE ENERGY CORP, | $ | 4.36 | $ | 0.09 | $ | 0.14 | $ | 0.11 | $ | (0.14) | $ | 0.01 | $ | 0.21 | $ | 4.57 | ||||||||||||
DILUTED |
A - Net of $39 million tax benefit. $102 million recorded within Operating Expenses and $1 million recorded within Interest Expense on the Consolidated Statements of Operations.
B - Net of $60 million tax benefit. $154 million recorded within Impairment charges and $4 million recorded within Other Income and Expenses on the Consolidated Statements of Operations. C - Net of $28 million tax benefit. $92 million recorded within Impairment charges and $10 million recorded within Other Income and Expenses on the Consolidated Statements of Operations.
D - $118 million benefit recorded with Income Tax Expense from Continuing Operations, offset by $16 million expense recorded within Gas Utilities and Infrastructure's Equity in Earnings of Unconsolidated Affiliates on the Consolidated Statements of Operations.
E - Recorded in Income (Loss) from Discontinued Operations, net of tax on the Consolidated Statements of Operations.
Weighted Average Shares, Diluted (reported and adjusted) - 700 million
Duke Energy Corporation
Available Liquidity Reconciliation
As of December 31, 2019
(In millions)
Cash and Cash Equivalents | $ | 311 | |
Less: Certain Amounts Held in Foreign Jurisdictions | (1) | ||
Less: Unavailable Domestic Cash | (33) | ||
277 | |||
Plus: Remaining Availability under Master Credit Facilities and other facilities | 5,332 | ||
Total Available Liquidity (a) | $ | 5,609 | approximately 5.6 billion |
- The available liquidity balance presented is a non-GAAP financial measure as it represents Cash and cash equivalents, excluding certain amounts held in foreign jurisdictions and cash otherwise unavailable for operations, and remaining availability under Duke Energy's available credit facilities, including the master credit facility. The most directly comparable GAAP financial measure for available liquidity is Cash and cash equivalents.
Duke Energy Corporation
Operations, Maintenance and Other Expense
(In millions)
Actual | Actual | Actual | Actual | Forecast | |||||||||||
December 31, 2016 | December 31, 2017 | December 31, 2018 | December 31, 2019 | December 31, 2020 | |||||||||||
Operation, maintenance and other(a) | $6,223 | $5,944 | $6,463 | $6,066 | $6,061 | ||||||||||
Adjustments: | |||||||||||||||
Costs to Achieve, Mergers(b) | (238) | (94) | (83) | - | - | ||||||||||
Severance(b) | (92) | - | (187) | - | - | ||||||||||
Regulatory settlement(b) | - | (5) | (40) | - | - | ||||||||||
Reagents Recoverable(c) | (93) | (90) | (112) | (95) | (102) | ||||||||||
Energy Efficiency Recoverable(c) | (417) | (485) | (446) | (415) | (424) | ||||||||||
Other Deferrals and Recoverable(c) | (233) | (246) | (477) | (472) | (382) | ||||||||||
Margin based O&M for Commercial Businesses | (185) | (94) | (113) | (95) | (202) | ||||||||||
Short-term incentive payments (over)/under budget | (90) | (22) | (30) | (112) | - | ||||||||||
Non-Rider Recoverable operation, maintenance and other | $ | 4,875 | $ | 4,908 | $ | 4,974 | $ | 4,878 | $ | 4,950 | |||||
- As reported in the Consolidated Statements of Operations.
- Presented as a special item for the purpose of calculating adjusted earnings and adjusted diluted earnings
- Primarily represents expenses to be deferred or recovered through rate riders.
DUKE ENERGY CORPORATION
ADJUSTED BOOK RETURN ON EQUITY (ROEs) For the period ended December 31, 2019 dollars in millions
Duke Energy | |||||||||||||||||||
Duke Energy | Duke Energy | Duke Energy | Duke Energy | Ohio Reportable | |||||||||||||||
Carolinas | Progress | Total Carolinas | Florida | Indiana | Segments | Piedmont | |||||||||||||
Reported Net Income 2019 | $ | 1,403 | $ | 805 | $ | 2,208 | $ | 693 | $ | 436 | $ | 244 | (2) | $ | 196 | (4) | |||
Special Items (1) | - | - | - | (27) | - | - | - | ||||||||||||
Adjusted Net Income 2019 | 1,403 | 805 | 2,208 | 666 | 436 | 244 | 196 | ||||||||||||
2019 | |||||||||||||||||||
Equity | 12,811 | 9,246 | 22,057 | 6,788 | 4,575 | 3,687 | (3) | 2,381 | (5) | ||||||||||
Goodwill | - | - | - | - | - | 920 | 49 | ||||||||||||
Equity less Goodwill | 12,811 | 9,246 | 22,057 | 6,788 | 4,575 | 2,767 | 2,332 | ||||||||||||
2018 | |||||||||||||||||||
Equity | 11,683 | 8,441 | 20,124 | 6,095 | 4,339 | 3,449 | (3) | 2,047 | (5) | ||||||||||
Goodwill | - | - | - | - | - | 920 | 49 | ||||||||||||
Equity less Goodwill | 11,683 | 8,441 | 20,124 | 6,095 | 4,339 | 2,529 | 1,998 | ||||||||||||
Average Equity less Goodwill | 12,247 | 8,844 | 21,091 | 6,442 | 4,457 | 2,648 | 2,165 | ||||||||||||
Adjusted Book ROEs | 10.5% | 10.3% | 9.8% | 9.2% | 9.1% |
- Impacts of Citrus County CC, Net of Tax
- Net Income for 2019 equals Duke Energy Ohio reportable segments segment income
- Reconciliation of Duke Energy Ohio Equity to Equity of the reportable segments:
2019 | 2018 | ||
Reported Equity for Duke Energy Ohio | 3,683 | 3,445 | |
Less: Non-Reg & Other | (4) | (4) | |
Duke Energy Ohio Reportable Segments Equity | 3,687 | 3,449 |
(4) Piedmont Natural Gas Net Income excludes $6 million of income related to Investments in Gas Transmission Infrastructure
2019 | |||
202 | |||
(6) | |||
196 | |||
(5) Reconciliation of Piedmont Natural Gas Equity to reported equity: | |||
2019 | 2018 | ||
Reported Equity for Piedmont Natural Gas | 2,443 | 2,091 | |
Less: Investments in Gas Transmission Infrastructure | 62 | 44 | |
Piedmont Natural Gas Adjusted Equity | 2,381 | 2,047 |
DUKE ENERGY CORPORATION
ADJUSTED BOOK RETURN ON EQUITY (ROEs) For the period ended December 31, 2018 dollars in millions
Duke Energy | |||||||||||||||||||
Duke Energy | Duke Energy | Duke Energy | Duke Energy | Ohio Reportable | |||||||||||||||
Carolinas | Progress | Total Carolinas | Florida | Indiana | Segments | Piedmont | |||||||||||||
Reported Net Income 2018 | $ | 1,071 | $ | 667 | $ | 1,738 | $ | 553 | $ | 393 | $ | 279 | (2) | $ | 124 | (4) | |||
Special Items (1) | 234 | 118 | 352 | 63 | 8 | - | 40 | ||||||||||||
Adjusted Net Income 2018 | 1,305 | 785 | 2,090 | 616 | 401 | 279 | 164 | ||||||||||||
2018 | |||||||||||||||||||
Equity | 11,683 | 8,441 | 20,124 | 6,095 | 4,339 | 3,449 | (3) | 2,047 | (5) | ||||||||||
Goodwill | - | - | - | - | - | 920 | 49 | ||||||||||||
Equity less Goodwill | 11,683 | 8,441 | 20,124 | 6,095 | 4,339 | 2,529 | 1,998 | ||||||||||||
2017 | |||||||||||||||||||
Equity | 11,361 | 7,949 | 19,310 | 5,618 | 4,121 | 3,166 | (3) | 1,616 | (5) | ||||||||||
Goodwill | - | - | - | - | - | 920 | 49 | ||||||||||||
Equity less Goodwill | 11,361 | 7,949 | 19,310 | 5,618 | 4,121 | 2,246 | 1,567 | ||||||||||||
Average Equity less Goodwill | 19,717 | 5,857 | 4,230 | 2,388 | 1,783 | ||||||||||||||
Adjusted Book ROEs | 10.6% | 10.5% | 9.5% | 11.7% | 9.2% |
- Costs to Achieve (CTA) Mergers net of tax, Severance, Regulatory and Legislative Impacts and Tax Reform.
- Net Income for 2018 equals Duke Energy Ohio reportable segments segment income, which already excludes CTA and cost savings initiatives, Severance and Sale of Retired Plant.
- Reconciliation of Duke Energy Ohio Equity to Equity of the reportable segments:
2018 | 2017 | ||
Reported Equity for Duke Energy Ohio | 3,445 | 3,163 | |
Less: Non-Reg & Other | (4) | (3) | |
Duke Energy Ohio Reportable Segments Equity | 3,449 | 3,166 |
- Piedmont Natural Gas Net Income excludes $5 million of income related to Investments in Gas Transmission Infrastructure.
- Reconciliation of Piedmont Natural Gas Equity to reported equity:
2018 | 2017 | ||
Reported Equity for Piedmont Natural Gas | 2,091 | 1,662 | |
Less: Investments in Gas Transmission Infrastructure | 44 | 46 | |
Piedmont Natural Gas Adjusted Equity | 2,047 | 1,616 |
DUKE ENERGY CORPORATION
ADJUSTED BOOK RETURN ON EQUITY (ROEs) For the period ended December 31, 2017 dollars in millions
Duke Energy | |||||||||||||||||||
Duke Energy | Duke Energy | Duke Energy | Duke Energy | Ohio Reportable | |||||||||||||||
Carolinas | Progress | Total Carolinas | Florida | Indiana | Segments | Piedmont | |||||||||||||
Reported Net Income 2017 | $ | 1,214 | $ | 715 | $ | 1,929 | $ | 712 | $ | 354 | $ | 223 | (2) | $ | 133 | (4) | |||
Special Items (1) | 28 | (17) | 11 | (136) | 58 | (20) | 25 | ||||||||||||
Adjusted Net Income 2017 | 1,242 | 698 | 1,940 | 576 | 412 | 203 | 158 | ||||||||||||
2017 | |||||||||||||||||||
Equity | 11,361 | 7,949 | 19,310 | 5,618 | 4,121 | 3,166 | (3) | 1,616 | (5) | ||||||||||
Goodwill | - | - | - | - | - | 920 | 49 | ||||||||||||
Equity less Goodwill | 11,361 | 7,949 | 19,310 | 5,618 | 4,121 | 2,246 | 1,567 | ||||||||||||
2016 | |||||||||||||||||||
Equity | 10,772 | 7,358 | 18,130 | 4,900 | 4,067 | 3,027 | (3) | 1,569 | (5) | ||||||||||
Goodwill | - | - | - | - | - | 920 | 49 | ||||||||||||
Equity less Goodwill | 10,772 | 7,358 | 18,130 | 4,900 | 4,067 | 2,107 | 1,520 | ||||||||||||
Average Equity less Goodwill | 18,720 | 5,259 | 4,094 | 2,177 | 1,544 | ||||||||||||||
Adjusted Book ROEs | 10.4% | 11.0% | 10.1% | 9.3% | 10.2% |
- Costs to Achieve (CTA), Mergers net of tax, Regulatory Settlements, and Tax Reform.
- Net Income for 2017 equals Duke Energy Ohio reportable segments segment income, which already excludes CTA and cost savings initiatives.
- Reconciliation of Duke Energy Ohio Equity to Equity of the reportable segments:
2017 | 2016 | ||
Reported Equity for Duke Energy Ohio | 3,163 | 2,996 | |
Less: Non-Reg & Other | (3) | (31) | |
Duke Energy Ohio Reportable Segments Equity | 3,166 | 3,027 |
- Piedmont Natural Gas Net Income excludes $6 million of income related to Investments in Gas Transmission Infrastructure.
- Reconciliation of Piedmont Natural Gas Equity to reported equity:
2017 | 2016 | ||
Reported Equity for Piedmont Natural Gas | 1,662 | 1,672 | |
Less: Investments in Gas Transmission Infrastructure | 46 | 103 | |
Piedmont Natural Gas Adjusted Equity | 1,616 | 1,569 |
Duke Energy Corporation | ||
2020 Forecasted Cash Flow Reconciliation, Required by SEC Regulation G | ||
February 13, 2020 | ||
($ in millions) | Forecast | |
Primary Sources: | 2020 | |
Adjusted net income (1) | (a) | $3,870 |
Depreciation & amortization | (a) | 5,470 |
Deferred and accrued taxes | (a) | 805 |
Other sources / (uses), net | (a) | (235) |
Total Sources | 9,910 | |
Primary Uses: | ||
Capital expenditures (including discretionary) | (b) | (11,825) |
Dividends | (c) | (2,800) |
Total Uses | (14,625) | |
Uses in Excess of Sources | ||
(4,715) | ||
Net Change in Financing | ||
Debt issuances | (c) | 5,210 |
Debt maturities | (c, d) | (3,565) |
Net Change in Debt | 1,645 | |
Common stock issuances | (c) | 2,985 |
Net Change in Cash | ($85) | |
Reconciliations to forecasted U.S. GAAP reporting amounts: | ||
Operating cash flow components, sum of (a) from above | $9,910 | |
Reconciling items to GAAP cash flows from operating activities | (2) | (580) |
Net cash provided by operating activities per GAAP Consolidated Statement of Cash Flows | $9,330 | |
Investing cash flow components, (b) from above | ($11,825) | |
Reconciling items to GAAP cash flows from investing activities | (2) | 75 |
Net cash used in investing activities per GAAP Consolidated Statement of Cash Flows | ($11,750) | |
Financing cash flow components, sum of (c) from above | $1,830 | |
Reconciling items to GAAP cash flows from financing activities | (2) | 505 |
Net cash provided by financing activities per GAAP Consolidated Statement of Cash Flows | $2,335 | |
Debt maturities [(d) from above] includes "Notes payable and commercial paper" which is separately presented | ||
per GAAP Consolidated Statements of Cash Flows | ||
Net decrease in cash and cash equivalents per forecasted GAAP Consolidated Statements of Cash Flows | ($85) | |
Notes:
- The forecasted adjusted net income of $3,870 million for 2020 is an illustrative amount based on the midpoint of Duke Energy's forecasted 2020 adjusted EPS outlook range of $5.05‐$5.45 per share. Adjusted EPS is a non‐GAAP financial measure as it represents basic and diluted EPS from continuing operations available to Duke Energy Corporation shareholders and adjusted for the per‐share impact of special items. Special items represent certain charges and credits which management believes will not be recurring on a regular basis, although it is reasonably possible such charges and credits could recur. The most directly comparable GAAP measure for adjusted EPS is reported basic and diluted EPS available to Duke Energy Corporation common shareholders, which includes the impact of special items. Due to the forward‐looking nature of this non‐ GAAP financial measure for future periods, information to reconcile it to the most directly comparable GAAP financial measure is not available at this time, as management is unable to project all special items.
- Amount consists primarily of an adjustment for operating cashflow items (principally payments for asset retirement obligations) included in the "Capital expenditures (including discretionary)", which are combined for the GAAP reconciliation in Investing activities; an adjustment for investing cash flow items (principally cost of removal expenditures, proceeds from sales and maturities of available‐for‐sale securities and Other) included in the "Other sources/(uses), net", which are combined for the GAAP reconciliation in Operating activities, and ; an adjustment for financing cash flow items (principally proceeds from Noncontrolling Interests initial investments, payments for interest on preferred debt/equity content securities, dividends on preferred stock, common equity forward transaction costs and Other) included in the "Adjusted net income", "Other sources/(uses), net" and "Capital expenditures (including discretionary)', which are combined for the GAAP reconciliation in Operating activities and Investing activities.
FFO to Debt Calculation | |||
Duke Energy Corporation | |||
(in millions) | Year Ended December 31, | ||
2019 | |||
Actual | |||
Cash From Operations | $ | 8,209 | |
Adjust for Working Capital | 250 | ||
Coal ash ARO spend | 746 | ||
Include Capitalized Interest as cost | (159) | ||
Hybrid interest adjustment | 10 | ||
Preferred stock adjustment | (21) | ||
CR3 securitization adjustment | (54) | ||
ACP construction loan interest adjustment | (32) | ||
AMT refund adjustment (1) | (287) | ||
Lease‐imputed FFO adjustment (D&A) | 240 | ||
Funds From Operations | $ | 8,903 | |
Notes payable and commercial paper | $ | 3,135 | |
Current maturities of LT debt | 3,141 | ||
LT debt | 54,985 | ||
Less: Purchase Accounting adjustments | (1,912) | ||
CR3 securitization | (1,111) | ||
Underfunded Pension | 350 | ||
ACP construction loan | 827 | ||
Hybrid debt adjustment | (250) | ||
Preferred stock adjustment | 1,000 | ||
Lease‐imputed debt | 1,640 | ||
Total Balance Sheet Debt (Including ST) | $ | 61,805 | |
Working capital detail, excluding MTM | |||
Receivables | $ | 78 | |
Inventory | (122) | ||
Other current assets | 10 | ||
Accounts payable | (164) | ||
Taxes accrued | (224) | ||
Other current liabilities | 172 | ||
$ | (250) | ||
FFO / Debt | 14.4% |
- AMT refund adjustment is an expected 2020 cash inflow from the IRS related to AMT refunds that Duke Energy will receive as a result of the 2017 Tax Act. The 2020 AMT refund
is included in the 2019 GAAP cash flow statement as deferred income taxes and change in other current assets. The change in other current assets is part of working capital, which is added back to the cash from operations. Therefore, the AMT refund adjustment is required to reduce cash from operations so there is no impact in 2019 for the 2020 expected AMT Refund.
In the 2018 Funds From Operations, a similar adjustment should have been made for the $573 million AMT refund. Had the adjustment been made, the Funds From Operations would have been reduced by $573 million. Starting in 2019 and going forward, receipt of the AMT refund will consistently be included in Fund From Operations in the year the cash is received.
FFO to Debt Calculation | ||
Duke Energy Carolinas | ||
(in millions) | Year Ended December 31, | |
2019 | ||
Actual | ||
Cash From Operations | $ | 2,709 |
Adjust for Working Capital | 144 | |
ARO spend | 278 | |
Include Capitalized Interest as cost | (30) | |
Lease‐imputed FFO adjustment (D&A) | 43 | |
Funds From Operations | $ | 3,144 |
Current maturities of LT debt | $ | 458 |
LT debt | 11,142 | |
LT debt payable to affiliates | 300 | |
Notes payable to affiliated companies | 29 | |
Lease imputed debt | 129 | |
Total Balance Sheet Debt (Including ST) | $ | 12,058 |
Working capital detail, excluding MTM | ||
Receivables | $ | (21) |
Receivables from affiliates | 68 | |
Inventory | (48) | |
Other current assets | (73) | |
Accounts payable | (50) | |
Accounts payable to affiliates | (20) | |
Taxes accrued | (127) | |
Other current liabilities | 127 | |
$ | (144) | |
FFO / Debt | 26.1% |
FFO to Debt Calculation | ||
Duke Energy Progress | ||
(in millions) | Year Ended December 31, | |
2019 | ||
Actual | ||
Cash From Operations | $ | 1,823 |
Adjust for Working Capital | (92) | |
Coal ash ARO spend | 390 | |
Include Capitalized Interest as cost | (28) | |
Lease‐imputed FFO adjustment (D&A) | 56 | |
Funds From Operations | $ | 2,149 |
Notes payable to affiliated companies | $ | 66 |
Current maturities of LT debt | 1,006 | |
LT debt | 7,902 | |
LT debt payable to affiliates | 150 | |
Lease imputed debt | 391 | |
Total Balance Sheet Debt (Including ST) | $ | 9,515 |
Working capital detail, excluding MTM | ||
Receivables | $ | 21 |
Receivables from affiliates | (29) | |
Inventory | 20 | |
Other current assets | 101 | |
Accounts payable | 32 | |
Accounts payable to affiliates | (75) | |
Taxes accrued | (46) | |
Other current liabilities | 68 | |
$ | 92 | |
FFO / Debt | 22.6% |
FFO to Debt Calculation | ||
Duke Energy Florida | ||
(in millions) | Year Ended December 31, | |
2019 | ||
Actual | ||
Cash From Operations | $ | 1,478 |
Adjust for Working Capital | (178) | |
Coal ash ARO spend | 22 | |
Include Capitalized Interest as cost | (3) | |
Adjust for CR3 | (54) | |
Lease‐imputed FFO adjustment (D&A) | 79 | |
Funds From Operations | $ | 1,344 |
Notes payable to affiliated companies | $ | ‐ |
Current maturities of LT debt | 571 | |
LT debt | 7,416 | |
Adjust for CR3 | (1,111) | |
Lease imputed debt | 401 | |
Underfunded Pension | 77 | |
Total Balance Sheet Debt (Including ST) | $ | 7,354 |
Working capital detail, excluding MTM | ||
Receivables | $ | 26 |
Receivables from affiliates | 17 | |
Inventory | 42 | |
Other current assets | 156 | |
Accounts payable | (36) | |
Accounts payable to affiliates | 40 | |
Taxes accrued | (31) | |
Other current liabilities | (36) | |
$ | 178 | |
FFO / Debt | 18.3% |
FFO to Debt Calculation | ||
Duke Energy Indiana | ||
(in millions) | Year Ended December 31, | |
2019 | ||
Actual | ||
Cash From Operations | $ | 997 |
Adjust for Working Capital | 2 | |
Coal ash ARO spend | 48 | |
Include Capitalized Interest as cost | (26) | |
Lease‐imputed FFO adjustment (D&A) | 18 | |
Funds From Operations | $ | 1,039 |
Notes payable to affiliated companies | $ | 30 |
Current maturities of LT debt | 503 | |
LT debt | 3,404 | |
LT debt payable to affiliates | 150 | |
CRC | 186 | |
Lease imputed debt | 58 | |
Total Balance Sheet Debt (Including ST) | $ | 4,331 |
Working capital detail, excluding MTM | ||
Receivables | $ | (8) |
Receivables from affiliates | 41 | |
Inventory | (95) | |
Other current assets | 76 | |
Accounts payable | (10) | |
Accounts payable to affiliates | 4 | |
Taxes accrued | (25) | |
Other current liabilities | 15 | |
$ | (2) | |
FFO / Debt | 24.0% |
FFO to Debt Calculation | ||
Duke Energy Ohio | ||
(in millions) | Year Ended December 31, | |
2019 | ||
Actual | ||
Cash From Operations | $ | 526 |
Adjust for Working Capital | (19) | |
Coal Ash ARO spend | 8 | |
Include capitalized Interest as cost | (22) | |
Lease‐imputed FFO adjustment (D&A) | 10 | |
Funds From Operations | $ | 503 |
Notes payable to affiliated companies | $ | 312 |
Current maturities of LT debt | ‐ | |
LT debt | 2,594 | |
LT debt payable to affiliates | 25 | |
CRC | 165 | |
Lease imputed debt | 22 | |
Total Balance Sheet Debt (Including ST) | $ | 3,118 |
Working capital detail, excluding MTM | ||
Receivables | $ | 20 |
Receivables from affiliates | 22 | |
Inventory | (9) | |
Other current assets | (5) | |
Accounts payable | (17) | |
Accounts payable to affiliates | (10) | |
Taxes accrued | 17 | |
Other current liabilities | 1 | |
$ | 19 | |
FFO / Debt | 16.1% |
FFO to Debt Calculation | ||
Piedmont Natural Gas | ||
(in millions) | Year Ended December 31, | |
2019 | ||
Actual | ||
Cash From Operations | $ | 409 |
Adjust for Working Capital | 88 | |
Include Capitalized Interest as cost | (26) | |
Lease‐imputed FFO adjustment (D&A) | 4 | |
Funds From Operations | $ | 475 |
Notes payable to affiliated companies | $ | 476 |
Current maturities of LT debt | ‐ | |
LT debt | 2,384 | |
Lease imputed debt | 27 | |
Total Balance Sheet Debt (Including ST) | $ | 2,887 |
Working capital detail, excluding MTM | ||
Receivables | $ | 28 |
Receivables from affiliates | 12 | |
Inventory | (2) | |
Other current assets | (25) | |
Accounts payable | (7) | |
Accounts payable to affiliates | (35) | |
Taxes accrued | (60) | |
Other current liabilities | 1 | |
$ | (88) | |
FFO / Debt | 16.5% |
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Duke Energy Corporation published this content on 13 February 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 13 February 2020 11:56:10 UTC
