COLUMBIA PIPELINE GROUP INC HOUSTON, Feb. 18, 2016 /PRNewswire/ -- Columbia Pipeline Group, Inc. (NYSE: CPGX) ("CPG") reported Adjusted EBITDA (non-GAAP) for the 12 months ended December 31, 2015 of $685.5 million, compared with $601.0 million in 2014. Distributable cash flow (non-GAAP) for the year was $401.3 million. Please refer to Schedules 1 and 2 in the financial tables below for a reconciliation of non-GAAP financial measures to the most directly comparable GAAP financial measures.
CPG reported net operating earnings from continuing operations - controlling interest (non-GAAP) of $282.9 million for the 12 months ended December 31, 2015, compared with $268.3 million for 2014.
On a GAAP basis, CPG reported income from continuing operations - controlling interest for the 12 months ended December 31, 2015 of $267.6 million, compared with $268.7 million for 2014.
CPG reported net operating earnings from continuing operations - controlling interest (non-GAAP) of $72.2 million for the three months ended December 31, 2015, compared with $62.6 million for the prior-year period.
On a GAAP basis, CPG reported income from continuing operations - controlling interest for the three months ended December 31, 2015 of $63.4 million, compared with $62.6 million for the prior-year period.
"Last year was clearly an historic one for CPG -- we completed a seamless separation from NiSource, secured the largest project in our company's history and continued our focus on the flawless execution of our deep inventory of expansion and modernization projects. This is an exciting and, truly transformational, time for CPG," said CPG Chairman and Chief Executive Officer Robert C. Skaggs, Jr.
2016 Guidance Announced; Robust Long-Term Guidance Affirmed
Skaggs reiterated that CPG's extensive, and highly accretive, project inventory is expected to drive average annual EBITDA and dividend growth of 20 and 15 percent, respectively, through 2020. He also noted that Columbia Pipeline Partners continues to expect to deliver 20 percent annual distribution growth over the same time period.
Following the successful completion of its approximately $1.4 billion common equity offering in December 2015, CPG noted that it will not need to access the capital markets until well into 2017. As of December 31, 2015, CPG had $2.9 billion in cash and borrowing capacity under its revolving credit facilities. In addition, the company's credit metrics remain strong and support its unwavering commitment to an investment grade credit rating.
For 2016, CPG expects to generate between $705 million and $715 million of Adjusted EBITDA. Cash capital expenditures are anticipated to be $1.4 billion to $1.6 billion, including maintenance capital.
Landmark Year Sets Stage for CPG Transformation
On July 1, 2015, CPG successfully completed its separation from NiSource and began operating as an independent pipeline, midstream and storage company. The company maintained its momentum in developing and advancing new projects, strengthening its leading position in the Marcellus and Utica Shale production regions. Key highlights include:
-- CPG secured binding precedent agreements for virtually all of the
capacity of its Mountaineer XPress ("MXP") and Gulf XPress ("GXP")
projects, which will provide significant new takeaway capacity for
Marcellus and Utica Shale production. Specifically, MXP will provide up
to 2.7 billion cubic feet per day (Bcf/d) of firm transportation
capacity on the Columbia Gas Transmission system and GXP will provide
nearly 900 million cubic feet per day (MMcf/d) of firm transportation
capacity on the Columbia Gulf Transmission ("Columbia Gulf") system.
Together, the projects involve a capital investment of approximately
$2.7 billion and are targeted to be placed in service in the fourth
quarter of 2018.
-- CPG's East Side Expansion project was placed in service in early
October. The nearly $300 million capital project provides 312 MMcf/d of
additional capacity for Marcellus Shale supplies to reach growing, and
capacity-constrained, northeastern and mid-Atlantic markets.
-- The Federal Energy Regulatory Commission ("FERC") approved construction
of CPG's Cameron Access and Utica Access projects. Located on the
southern portion of the Columbia Gulf system, the Cameron Access project
will provide direct access to the Cameron LNG export facility, and is
targeted to be placed in service in early 2018. The Utica Access project
will connect abundant Appalachian supplies to high value domestic
markets, and is targeted to be placed in service in the fourth quarter
of 2016.
-- Progress continued on several other major growth projects, including
CPG's approximately $1.8 billion Leach XPress and Rayne XPress projects
and the $850 million WB XPress project. Together with the Cameron Access
and Utica Access projects mentioned above, these projects will create
approximately 4 Bcf/d of new capacity commitments across the CPG system,
including access to LNG export facilities in Louisiana and Maryland.
-- Columbia Midstream Group ("CMG") continued to execute on its Marcellus
and Utica-based growth plan by placing in service the first phase of its
$120 million Washington County Gathering project, as well as the initial
phase of its $75 million Big Pine Expansion project.
-- CMG also continued to advance its Gibraltar project -- an approximately
$270 million capital investment in a 1 Bcf/d dry gas header pipeline in
southwest Pennsylvania targeting Utica production. The first phase of
the project is expected to be placed in service during the fourth
quarter of 2016.
-- In addition, CMG announced the expansion of its Pennant Joint Venture
with the addition of an affiliate of Williams Partners L.P., Three
Rivers Midstream LLC. The addition of Three Rivers Midstream nearly
tripled the acreage dedicated to the Pennant system to more than 500,000
acres, which is expected to significantly increase Pennant's
infrastructure investment opportunities over time.
-- In December, CPG filed a customer agreement with the FERC to extend its
long-term system modernization program an additional three years,
through 2020. The agreement will provide for approximately $1.1 billion
of additional investment and also expands the scope of facility
investments covered by the program. Prior to the filing, CPG completed
the third year of the program, placing approximately $319 million of
modernization investments into service, and began rate recovery on those
investments earlier this month.
"Despite ongoing turmoil in the energy and financial markets, the CPG Team remained focused and continued to hit its marks in 2015, advancing a well-established, straightforward, fee-based growth strategy," said Skaggs. "The fundamentals of our business remain very strong, and our growth profile continues to distinguish CPG."
Skaggs closed by reiterating the key attributes which differentiate CPG and make it a compelling investment proposition -- a stable core business with highly predictable cash flows, an unparalleled strategic asset footprint in the Marcellus and Utica Shale regions, and a robust and highly visible inventory of contracted, accretive growth and modernization investments.
Year Ended December 31, 2015 Operating Results
CPG's net operating earnings from continuing operations - controlling interest (non-GAAP) for the year ended December 31, 2015 were $282.9 million compared with $268.3 million for the prior-year period. Please refer to Schedule 1 for a reconciliation of net operating earnings to GAAP. A comparison of operating results for the year ended December 31, 2015 to the year ended December 31, 2014 is summarized below. Earnings for the periods prior to the date of CPG's separation from NiSource Inc. are derived from the financial statements and accounting records of CPG's predecessor.
Operating revenues, excluding the impact of trackers, increased by $99.3 million, primarily due to higher demand margin revenue from growth projects placed into service and new firm contracts and increased shorter term transportation services, partially offset by a decrease in mineral rights royalty revenue, lower condensate revenues, decreased revenue from the settlement of gas imbalances and lower commodity revenue.
Operating expenses, excluding the impact of trackers, increased by $55.5 million, primarily due to higher employee and administrative costs, increased depreciation, higher outside service costs and increased property and other taxes. These increases were partially offset by increased gains on the conveyances of mineral interests.
Equity earnings increased by $13.9 million, primarily due to earnings generated by new Pennant facilities being fully placed in service and increased revenues from growth projects placed in service at Millennium Pipeline.
Other income (deductions) for the year ended December 31, 2015 decreased income by $14.4 million compared with the same period in 2014. The variance was primarily due to an increase in interest expense resulting from the issuance of long-term debt in May 2015, partially offset by Allowance for Funds Used During Construction ("AFUDC").
The effective tax rate of net operating earnings was 33.0% compared with 38.8% for the same 2014 period. The 5.8% decrease is primarily due to Columbia Pipeline Partners LP ("CPPL") earnings for which the noncontrolling public limited partners are directly responsible for the related income taxes.
Three Months Ended December 31, 2015 Operating Results
CPG's net operating earnings from continuing operations - controlling interest (non-GAAP) for the three months ended December 31, 2015 were $72.2 million compared with $62.6 million for the prior-year period. Please refer to Schedule 1 for a reconciliation of net operating earnings to GAAP. A comparison of operating results for the three months ended December 31, 2015 to the three months ended December 31, 2014 is summarized below. Earnings for the periods prior to the date of CPG's separation from NiSource Inc. are derived from the financial statements and accounting records of CPG's predecessor.
Operating revenues, excluding the impact of trackers, increased by $39.3 million, primarily due to higher demand margin revenue from growth projects placed into service and new firm contracts and increased shorter term transportation services, partially offset by a decrease in mineral rights royalty revenue.
Operating expenses, excluding the impact of trackers, increased by $40.6 million, primarily due to higher employee and administrative costs, decreased gains on the conveyances of mineral interests, higher depreciation, and increased property and other taxes.
Equity earnings increased by $2.3 million, primarily due to earnings generated by new Pennant facilities being fully placed in service.
Other income (deductions) for the three months ended December 31, 2015 increased income by $9.7 million compared with the same period in 2014. The variance was primarily due to an increase in AFUDC, partially offset by an increase in interest expense resulting from the issuance of long-term debt in May 2015.
The effective tax rate of net operating earnings was 31.3% compared with 44.0% for the same 2014 period. The 12.7% decrease is primarily due to CPPL earnings for which the noncontrolling public limited partners are directly responsible for the related income taxes, increases in AFUDC equity related to increased construction and increases in state income taxes in 2014.
Conference Call
Columbia Pipeline Group, Inc. and Columbia Pipeline Partners LP will host a joint investor conference call at 9:00 a.m. ET (8:00 a.m. CT) on Thursday, February 18, 2016, to review their fourth quarter and year end 2015 financial results. All interested parties may listen to the conference call live by logging onto the Columbia Pipeline Group or Columbia Pipeline Partners investor relations websites at http://investors.cpg.com or http://investors.columbiapipelinepartners.com.
A replay of the call will be available beginning at 1:00 pm ET on February 18, 2016 through 11:59 p.m. ET on February 25, 2016. To access the recording, call (855) 859-2056 and enter conference ID 25506873. For international participants to hear the replay, please dial (404) 537-3406 and enter the same conference ID as above, 25506873. A recording of the call also will be archived on the Columbia Pipeline Group and Columbia Pipeline Partners websites.
Non-GAAP Financial Measures
Operating Earnings, Adjusted EBITDA and Distributable Cash Flow
We define Operating Earnings as operating income adjusted for transactions that are considered unusual, infrequent or not representative of underlying trends. Examples of these transactions include impairments and costs associated with CPG's separation from NiSource Inc. We define Adjusted EBITDA as net income before interest expense, income taxes, and depreciation and amortization, plus distributions of earnings received from equity investees and one-time transition costs, less equity earnings in unconsolidated affiliates and other, net. In addition, to the extent transactions occur that are considered unusual, infrequent or not representative of underlying trends, we will remove the effect of these items from Adjusted EBITDA. Examples of these transactions include impairments and costs associated with the separation. We define Distributable Cash Flow as Adjusted EBITDA less interest expense, maintenance capital expenditures, gain on sale of assets, net cash paid for taxes, and distributions to public unitholders plus proceeds from sale of assets, interest income, capital (received) costs related to the separation and any other known differences between cash and income.
Operating Earnings, Adjusted EBITDA and Distributable Cash Flow are non-GAAP supplemental financial measures that management and external users of our financial statements, such as industry analysts, investors, lenders and rating agencies, may use to assess the viability of acquisitions and other capital expenditure projects and the returns on investment of various investment opportunities.
We believe that the presentations of Operating Earnings, Adjusted EBITDA and Distributable Cash Flow will provide useful information to investors in assessing our financial condition and results of operations. The GAAP measures most directly comparable to Operating Earnings is Operating Income. The GAAP measures most directly comparable to Adjusted EBITDA and Distributable Cash Flow are Net Income and Net Cash Flows from Operating Activities. Our non-GAAP financial measures of Operating Earnings, Adjusted EBITDA and Distributable Cash Flow should not be considered as an alternative to GAAP operating income, net income or net cash flows from operating activities. Operating Earnings, Adjusted EBITDA and Distributable Cash Flow have important limitations as analytical tools because they exclude some but not all items that affect operating income, net income and net cash flows from operating activities. You should not consider Operating Earnings, Adjusted EBITDA or Distributable Cash Flow in isolation or as a substitute for analysis of our results as reported under GAAP. Because Operating Earnings, Adjusted EBITDA or Distributable Cash Flow may be defined differently by other companies in our industry, our definitions of Operating Earnings, Adjusted EBITDA or Distributable Cash Flow may not be comparable to similarly titled measures of other companies, thereby diminishing their utility.
About Columbia Pipeline Group, Inc.
Columbia Pipeline Group, Inc. operates approximately 15,000 miles of strategically located interstate pipeline, gathering and processing assets extending from New York to the Gulf of Mexico, including an extensive footprint in the Marcellus and Utica shale production areas. Columbia Pipeline Group, Inc. also operates one of the nation's largest underground natural gas storage systems. Columbia Pipeline Group, Inc. is listed on the NYSE under the ticker symbol CPGX. Additional information can be found at www.cpg.com.
Forward-Looking Statements
This release includes "forward-looking statements" within the meaning of federal securities laws, which are statements other than historical facts and that frequently use words such as "anticipate," "believe," "continue," "could," "estimate," "expect," "forecast," "intend," "may," "plan," "position," "should," "strategy," "target," "will" and similar words. All forward-looking statements speak only as of the date of this release. Although CPG believes that the plans, intentions and expectations reflected in or suggested by the forward-looking statements are reasonable, there is no assurance that these plans, intentions or expectations will be achieved. Therefore, actual outcomes and results could materially differ from what is expressed, implied or forecasted in such statements. This release contains certain forward-looking statements that are based on current plans and expectations and are subject to various risks and uncertainties. CPG's business may be influenced by many factors that are difficult to predict, involve uncertainties that may materially affect actual results and are often beyond CPG's control. These factors include, but are not limited to, changes in general economic conditions; competitive conditions in our industry; actions taken by third-party operators, processors and transporters; the demand for natural gas storage and transportation services; our ability to successfully implement our business plan; our ability to complete internal growth projects on time and on budget; the price and availability of debt and equity financing; the availability and price of natural gas to the consumer compared with the price of alternative and competing fuels; competition from the same and alternative energy sources; energy efficiency and technology trends; operating hazards and other risks incidental to transporting, storing and gathering natural gas; natural disasters, weather-related delays, casualty losses and other matters beyond our control; interest rates; labor relations; large customer defaults; changes in the availability and cost of capital; changes in tax status; the effects of existing and future laws and governmental regulations; and the effects of future litigation. For a full discussion of these risks and uncertainties, please refer to the "Risk Factors" section of CPG's Registration Statement on Form 10 dated and filed with the Securities Exchange Commission on February 6, 2015, as amended and declared effective on June 2, 2015. Additional information will also be set forth in our Annual Report on Form 10-K for the year ended December 31, 2015. All forward-looking statements included in this press release are expressly qualified in their entirety by such cautionary statements. CPG expressly disclaims any obligation to update, amend or clarify any forward-looking statement to reflect events, new information or circumstances occurring after the date of this press release except as required by applicable law.
Columbia Pipeline Group, Inc.
Consolidated Net Operating Earnings (Non-GAAP)
(unaudited)
Three Months Ended Year Ended
December 31, December 31,
------------ ------------
(in millions, except per share amounts) 2015 2014 2015 2014
-------------------------------------- ---- ---- ---- ----
Operating Revenues
Transportation revenues $265.6 $188.3 $849.7 $674.6
Transportation revenues-affiliated - 29.5 43.7 90.9
Transportation revenues-trackers 36.4 59.1 208.5 321.1
Storage revenues 48.4 35.7 170.0 143.3
Storage revenues-affiliated - 13.1 26.1 52.5
Storage revenues-trackers 0.7 0.1 1.5 1.3
Other revenues 6.8 14.9 35.4 64.3
-------------- --- ---- ---- ----
Total Operating Revenues 357.9 340.7 1,334.9 1,348.0
------------------------ ----- ----- ------- -------
Operating Expenses
Operation and maintenance 146.1 93.8 423.3 306.0
Operation and maintenance-affiliated - 33.3 52.9 123.2
Operation and maintenance-trackers 37.1 59.2 210.0 322.4
Depreciation and amortization 38.5 30.9 139.9 118.8
Gain on sale of assets (2.7) (13.7) (55.3) (34.5)
Property and other taxes 19.8 16.8 75.3 67.1
Total Operating Expenses 238.8 220.3 846.1 903.0
------------------------ ----- ----- ----- -----
Equity Earnings in Unconsolidated Affiliates 16.0 13.7 60.5 46.6
-------------------------------------------- ---- ---- ---- ----
Operating Earnings 135.1 134.1 549.3 491.6
------------------ ----- ----- ----- -----
Other Income (Deductions)
Interest expense (25.3) - (67.6) -
Interest expense-affiliated - (22.9) (29.3) (62.0)
Other, net 12.7 0.6 29.3 8.8
---------- ---- --- ---- ---
Total Other Deductions, net (12.6) (22.3) (67.6) (53.2)
--------------------------- ----- ----- ----- -----
Operating Earnings from Continuing Operations before Income 122.5 111.8 481.7 438.4
Taxes
Income Taxes 38.3 49.2 158.9 170.1
------------ ---- ---- ----- -----
Net Operating Earnings from Continuing Operations 84.2 62.6 322.8 268.3
------------------------------------------------- ---- ---- ----- -----
Less: Net Operating Earnings from Continuing Operations - 12.0 - 39.9 -
Noncontrolling Interest
-----------------------
Net Operating Earnings from Continuing Operations - Controlling 72.2 62.6 282.9 268.3
Interest
--------
GAAP Adjustment (8.8) - (15.3) 0.4
--------------- ---- --- ----- ---
GAAP Income from Continuing Operations - Controlling Interest $63.4 $62.6 $267.6 $268.7
============================================================= ===== ===== ====== ======
Basic Net Operating Earnings Per Share from Continuing $0.21 $0.20 $0.86 $0.84
Operations
----------
GAAP Basic Earnings Per Share from Continuing Operations $0.19 $0.20 $0.81 $0.84
-------------------------------------------------------- ----- ----- ----- -----
Basic Average Common Shares Outstanding 339.3 317.6 328.5 317.6
======================================= ===== ===== ===== =====
Throughput (MMDth)
Columbia Gas Transmission 363.4 355.5 1,460.1 1,379.4
Columbia Gulf 142.2 153.4 562.7 626.7
Crossroads 3.8 4.3 15.5 16.7
Total 509.4 513.2 2,038.3 2,022.8
----- ----- ----- ------- -------
Columbia Pipeline Group, Inc.
Schedule 1 - Reconciliation of Net Operating Earnings to GAAP
Three Months Ended Year Ended
December 31, December 31,
------------ ------------
(in millions) 2015 2014 2015 2014
------------ ---- ---- ---- ----
Net Operating Earnings from Continuing Operations - Controlling $72.2 $62.6 $282.9 $268.3
Interest
--------
Items excluded from operating earnings
Operating Expenses:
Separation costs (12.9) - (18.8) -
Asset impairments - - (2.4) -
Total items excluded from operating earnings (12.9) - (21.2) -
-------------------------------------------- ----- --- ----- ---
Other Deductions:
Income taxes - discrete items (0.6) - (1.8) 0.4
Tax effect of above items 4.7 - 7.7 -
Total items excluded from net operating earnings (8.8) - (15.3) 0.4
------------------------------------------------ ---- --- ----- ---
GAAP Income from Continuing Operations - Controlling Interest $63.4 $62.6 $267.6 $268.7
============================================================= ===== ===== ====== ======
Columbia Pipeline Group, Inc.
Schedule 2 - Non-GAAP Reconciliation of Adjusted EBITDA and Distributable Cash Flow
(unaudited)
Three Months Ended Year Ended
December 31, December 31,
------------ ------------
(in millions) 2015 2014 2015 2014
------------ ---- ---- ---- ----
Net Income $75.4 $62.6 $307.1 $268.1
Add:
Interest expense 25.3 - 67.6 -
Interest expense-affiliated - 22.9 29.3 62.0
Income taxes 34.2 49.2 153.0 169.7
Depreciation and amortization 38.5 30.9 139.9 118.8
Impairments and Separation costs 12.9 - 21.2 -
Distributions of earnings received from equity investees 13.1 10.2 57.2 37.8
Less:
Equity earnings in unconsolidated affiliates 16.0 13.7 60.5 46.6
Other, net 12.7 0.6 29.3 8.8
Adjusted EBITDA $170.7 $161.5 $685.5 $601.0
--------------- ------ ------ ------ ------
Less:
Adjusted EBITDA attributable to noncontrolling interest 14.1 49.9
Adjusted EBITDA attributable to CPG $156.6 $635.6
=================================== ====== ======
Net Cash Flows from Operating Activities $79.3 $119.3 $493.5 $564.8
Interest expense 25.3 - 67.6 -
Interest expense-affiliated - 22.9 29.3 62.0
Current taxes (20.0) (14.6) 21.1 27.1
Gain on sale of assets and impairment, net 2.7 13.7 52.9 34.5
Other adjustments to operating cash flows 3.4 0.9 3.1 (6.3)
Changes in assets and liabilities 80.0 19.3 18.0 (81.1)
Adjusted EBITDA $170.7 $161.5 $685.5 $601.0
--------------- ------ ------ ------ ------
Less:
Adjusted EBITDA attributable to noncontrolling interest 14.1 49.9
Adjusted EBITDA attributable to CPG $156.6 $635.6
=================================== ====== ======
Adjusted EBITDA $170.7 $685.5
Less:
Interest expense 25.3 96.9
Maintenance capital expenditures 42.1 141.9
Separation maintenance capital expenditures 6.9 75.4
Gain on sale of assets 2.7 55.3
Net cash (received) paid for taxes (20.0) 21.1
Distributions to public unitholders 9.3 23.2
Add:
Proceeds from sales of assets 24.3 77.6
Interest income 0.2 2.8
Capital (received) costs related to Separation (17.2) 49.2
Distributable Cash Flow $111.7 $401.3
======================= ====== ======
Columbia Pipeline Group, Inc.
Schedule 3 - Non-GAAP Reconciliation of Forecasted Adjusted EBITDA
(unaudited)
Net income and net cash flows from operating activities are the most directly comparable GAAP measures to adjusted EBITDA. We reconcile adjusted EBITDA to net income for the 2016 guidance presented below. It is, however,
impractical to reconcile adjusted EBITDA to net cash flows from operating activities for the forecasted period. Schedule 2 of this earnings release presents a historical reconciliation of adjusted EBITDA to net income and net
cash flows from operating activities.
Year Ended
December 31, 2016
-----------------
(in millions) Low High
------------ --- ----
Net Income $248 $258
Add:
Interest expense 125 118
Income taxes 110 113
Depreciation and amortization 167 167
Separation costs 87 87
Distributions of earnings received from equity investees 58 62
Less:
Equity earnings in unconsolidated affiliates 58 62
Other, net 32 28
Adjusted EBITDA $705 $715
=============== ==== ====
Columbia Pipeline Group, Inc.
Statements of Consolidated Operations (GAAP)
(unaudited)
Three Months Ended Year Ended
December 31, December 31,
------------ ------------
(in millions, except per share amounts) 2015 2014 2015 2014
-------------------------------------- ---- ---- ---- ----
Operating Revenues
Transportation revenues $302.0 $247.4 $1,054.4 $990.8
Transportation revenues-affiliated - 29.5 47.5 95.7
Storage revenues 49.1 35.8 171.4 144.0
Storage revenues-affiliated - 13.1 26.2 53.2
Other revenues 6.8 14.9 35.4 64.3
-------------- --- ---- ---- ----
Total Operating Revenues 357.9 340.7 1,334.9 1,348.0
------------------------ ----- ----- ------- -------
Operating Expenses
Operation and maintenance 196.1 153.0 652.1 628.4
Operation and maintenance-affiliated - 33.3 52.9 123.2
Depreciation and amortization 38.5 30.9 139.9 118.8
Gain on sale of assets and impairment, net (2.7) (13.7) (52.9) (34.5)
Property and other taxes 19.8 16.8 75.3 67.1
Total Operating Expenses 251.7 220.3 867.3 903.0
------------------------ ----- ----- ----- -----
Equity Earnings in Unconsolidated Affiliates 16.0 13.7 60.5 46.6
-------------------------------------------- ---- ---- ---- ----
Operating Income 122.2 134.1 528.1 491.6
---------------- ----- ----- ----- -----
Other Income (Deductions)
Interest expense (25.3) - (67.6) -
Interest expense-affiliated - (22.9) (29.3) (62.0)
Other, net 12.7 0.6 29.3 8.8
---------- ---- --- ---- ---
Total Other Deductions, net (12.6) (22.3) (67.6) (53.2)
--------------------------- ----- ----- ----- -----
Income from Continuing Operations before Income Taxes 109.6 111.8 460.5 438.4
Income Taxes 34.2 49.2 153.0 169.7
------------ ---- ---- ----- -----
Income from Continuing Operations $75.4 $62.6 $307.5 $268.7
Loss from Discontinued Operations-net of taxes - - (0.4) (0.6)
---------------------------------------------- --- --- ---- ----
Net Income $75.4 $62.6 $307.1 $268.1
Less: Net income attributable to noncontrolling interest 12.0 39.9
-------------------------------------------------------- ---- ----
Net income attributable to CPG $63.4 $267.2
============================== ===== ======
Amounts attributable to CPG:
Income from continuing operations $63.4 $62.6 $267.6 $268.7
Loss from discontinued operations-net of taxes - - (0.4) (0.6)
Net income attributable to CPG $63.4 $62.6 $267.2 $268.1
------------------------------ ----- ----- ------ ------
Basic Earnings Per Share
Continuing Operations $0.19 $0.20 $0.81 $0.84
Discontinued Operations - - - -
Basic Earnings Per Share $0.19 $0.20 $0.81 $0.84
------------------------ ----- ----- ----- -----
Diluted Earnings Per Share
Continuing Operations $0.19 $0.20 $0.81 $0.84
Discontinued Operations - - - -
Diluted Earnings Per Share $0.19 $0.20 $0.81 $0.84
-------------------------- ----- ----- ----- -----
Basic Average Common Shares Outstanding 339.3 317.6 328.5 317.6
Diluted Average Common Shares 339.3 317.6 329.1 317.6
Dividends Declared Per Common Share $0.25 $ - $0.25 $ -
----------------------------------- ----- --------- ----- -----------
Columbia Pipeline Group, Inc.
Consolidated Balance Sheets (GAAP)
(unaudited)
December 31, December 31,
(in millions) 2015 2014
------------ ---- ----
ASSETS
Current Assets
Cash and cash equivalents $930.9 $0.5
Accounts receivable (less reserve of $0.6 and $0.6, respectively) 152.4 149.4
Accounts receivable-affiliated - 180.0
Materials and supplies, at average cost 32.8 24.9
Exchange gas receivable 19.0 34.8
Deferred property taxes 52.0 48.9
Deferred income taxes - 60.0
Prepayments and other 48.5 20.8
--------------------- ---- ----
Total Current Assets 1,235.6 519.3
-------------------- ------- -----
Investments
Unconsolidated affiliates 438.1 444.3
Other investments 13.8 2.7
Total Investments 451.9 447.0
----------------- ----- -----
Property, Plant and Equipment
Property, plant and equipment 9,052.3 7,935.4
Accumulated depreciation and amortization (2,988.6) (2,976.8)
Net Property, Plant and Equipment 6,063.7 4,958.6
--------------------------------- ------- -------
Other Noncurrent Assets
Regulatory assets 177.7 151.9
Goodwill 1,975.5 1,975.5
Postretirement and postemployment benefits assets 115.7 90.0
Deferred charges and others 36.1 15.2
Total Other Noncurrent Assets 2,305.0 2,232.6
----------------------------- ------- -------
Total Assets $10,056.2 $8,157.5
============ ========= ========
Columbia Pipeline Group, Inc.
Consolidated Balance Sheets (GAAP) (continued)
(unaudited)
December 31, December 31,
(in millions, except share amounts) 2015 2014
---------------------------------- ---- ----
LIABILITIES AND EQUITY
Current Liabilities
Current portion of long-term debt-affiliated $ - $115.9
Short-term borrowings 15.0 -
Short-term borrowings-affiliated - 252.5
Accounts payable 56.8 56.0
Accounts payable-affiliated - 53.6
Customer deposits 17.9 13.4
Taxes accrued 106.0 103.2
Interest accrued 9.5 -
Exchange gas payable 18.6 34.7
Deferred revenue 15.0 22.5
Accrued capital expenditures 100.1 61.1
Accrued compensation and related costs 51.9 31.2
Other accruals 70.0 40.1
-------------- ---- ----
Total Current Liabilities 460.8 784.2
------------------------- ----- -----
Noncurrent Liabilities
Long-term debt 2,746.2 -
Long-term debt-affiliated - 1,472.8
Deferred income taxes 1,348.1 1,255.7
Accrued liability for postretirement and postemployment benefits 49.4 53.0
Regulatory liabilities 321.6 295.7
Asset retirement obligations 25.7 23.2
Other noncurrent liabilities 91.4 96.6
Total Noncurrent Liabilities 4,582.4 3,197.0
---------------------------- ------- -------
Total Liabilities 5,043.2 3,981.2
----------------- ------- -------
Commitments and Contingencies
Equity
Common stock, $0.01 par value, 2,000,000,000 shares authorized; 4.0 -
399,841,350 and no shares outstanding, respectively
Additional paid-in capital 4,032.7 -
Retained earnings 46.9 -
Net parent investment - 4,210.8
Accumulated other comprehensive loss (27.0) (34.5)
Total CPG Equity 4,056.6 4,176.3
---------------- ------- -------
Noncontrolling Interest 956.4 -
Total Equity 5,013.0 4,176.3
Total Liabilities and Equity $10,056.2 $8,157.5
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Columbia Pipeline Group, Inc.
Statements of Consolidated and Combined Cash Flows (GAAP)
Year Ended December 31, (in millions) 2015 2014
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Operating Activities
Net Income $307.1 $268.1
Adjustments to Reconcile Net Income to Net Cash from Continuing Operations:
Depreciation and amortization 139.9 118.8
Deferred income taxes and investment tax credits 131.9 142.6
Deferred revenue 4.2 1.6
Equity-based compensation expense and profit sharing contribution 9.4 6.3
Gain on sale of assets and impairment, net (52.9) (34.5)
Equity earnings in unconsolidated affiliates (60.5) (46.6)
Loss from discontinued operations-net of taxes 0.4 0.6
Amortization of debt related costs 3.1 -
AFUDC equity (28.3) (11.0)
Distributions of earnings received from equity investees 57.2 37.8
Changes in Assets and Liabilities:
Accounts receivable (17.4) (20.3)
Accounts receivable-affiliated 34.7 (3.6)
Accounts payable (5.0) 2.8
Accounts payable-affiliated (53.6) 12.4
Customer deposits (22.9) 77.5
Taxes accrued 8.2 12.0
Interest accrued 9.4 -
Exchange gas receivable/payable (0.3) 1.1
Other accruals 50.2 0.9
Prepayments and other current assets (27.1) (4.4)
Regulatory assets/liabilities 20.2 9.0
Postretirement and postemployment benefits (4.4) (1.3)
Deferred charges and other noncurrent assets (16.3) (4.3)
Other noncurrent liabilities 6.5 0.7
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Net Operating Activities from Continuing Operations 493.7 566.2
Net Operating Activities from Discontinued Operations (0.2) (1.4)
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Net Cash Flows from Operating Activities 493.5 564.8
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Investing Activities
Capital expenditures (1,181.0) (747.2)
Insurance recoveries 2.1 11.3
Change in short-term lendings-affiliated 145.5 (57.2)
Proceeds from disposition of assets 77.6 9.3
Contributions to equity investees (1.4) (69.2)
Distributions from equity investees 16.0 -
Other investing activities (27.4) (7.1)
-------------------------- ----- ----
Net Cash Flows (used for) Investing Activities (968.6) (860.1)
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Financing Activities
Change in short-term borrowings 15.0 -
Change in short-term borrowings-affiliated (252.5) (467.1)
Issuance of long-term debt 2,745.9 -
Debt related costs (23.6) (6.4)
Issuance of long-term debt-affiliated 1,217.3 768.9
Payments of long-term debt-affiliated, including current portion (2,807.8) -
Proceeds from the issuance of common units, net of offering costs 1,168.4 -
Issuance of common stock 1,394.7 -
Distribution of IPO proceeds to parent (500.0) -
Distribution to parent (1,450.0) -
Distribution to noncontrolling interest (23.2) -
Dividends paid - common stock (79.5) -
Transfer from parent 0.8 -
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Net Cash Flows from Financing Activities 1,405.5 295.4
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Change in cash and cash equivalents 930.4 0.1
Cash and cash equivalents at beginning of period 0.5 0.4
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Cash and Cash Equivalents at End of Period $930.9 $0.5
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SOURCE Columbia Pipeline Group, Inc.
