WEC Energy : First Quarter 2024 NSG

NORTH SHORE GAS COMPANY

(An Indirect Wholly Owned Subsidiary of WEC Energy Group, Inc.)

FINANCIAL STATEMENTS

For the Quarter Ended March 31, 2024

NORTH SHORE GAS COMPANY

CONDENSED INCOME STATEMENTS (Unaudited)		Three Months Ended
			March 31
(in millions)		2024			2023
Operating revenues		$	78.5		$	82.0
Operating expenses
Cost of natural gas		39.8			44.1
Other operation and maintenance		11.5			13.3
Depreciation and amortization		5.3			5.1
Property and revenue taxes		0.9			1.2
Total operating expenses			57.5			63.7
Operating income		21.0			18.3
Other income, net		0.3			0.3
Interest expense		2.1			2.0
Other expense			(1.8)			(1.7)
Income before income taxes		19.2			16.6
Income tax expense		5.2			4.4
Net income		$	14.0		$	12.2

NORTH SHORE GAS COMPANY

CONDENSED BALANCE SHEETS (Unaudited)			March 31			December 31
(in millions, except share amounts)			2024			2023
Assets
Current assets
Cash and cash equivalents	$	0.4	$	0.2
Accounts receivable and unbilled revenues, net of reserves of $3.5 and $2.3, respectively			39.3			39.8
Accounts receivable from related parties			1.2			2.7
Materials, supplies, and inventories			10.9			25.1
Prepayments			0.9			2.5
Collateral on deposit			6.9			8.0
Other			3.2			2.9
Current assets			62.8			81.2
Long-term assets
Property, plant, and equipment, net of accumulated depreciation and amortization of $270.6 and
$267.8, respectively			548.4			547.3
Regulatory assets			57.6			57.3
Other postretirement employee benefit assets			14.2			14.0
Other			1.9			1.2
Long-term assets			622.1			619.8
Total assets		$	684.9		$	701.0
Liabilities and Shareholder's Equity
Current liabilities
Accounts payable	$	16.8	$	24.4
Accounts payable to related parties			3.8			6.8
Accrued taxes			6.6			3.3
Short-term debt to related party			17.3			27.9
Customer credit balances			8.3			12.3
Derivative liabilities			4.8			6.5
Other			7.4			6.9
Current liabilities			65.0			88.1
Long-term liabilities
Long-term debt			176.1			176.1
Deferred income taxes			79.2			77.8
Regulatory liabilities			68.0			68.1
Environmental remediation liabilities			31.4			32.2
Pension obligations			12.5			12.2
Asset retirement obligations			26.8			26.6
Other			5.3			6.4
Long-term liabilities			399.3			399.4
Commitments and contingencies
Shareholder's equity
Common stock, without par value, 5,000,000 shares authorized; 3,625,887 shares issued and
outstanding			95.1			95.0
Retained earnings			125.5			118.5
Shareholder's equity			220.6			213.5
Total liabilities and shareholder's equity		$	684.9		$	701.0

NORTH SHORE GAS COMPANY

CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)		Three Months Ended
			March 31
(in millions)		2024			2023
Operating activities
Net income	$	14.0	$	12.2
Reconciliation to cash provided by operating activities
Depreciation and amortization		5.3			5.1
Deferred income taxes and investment tax credits, net		0.9			(0.2)
Settlement of asset retirement obligations		(0.1)			(0.1)
Manufactured gas plant remediation costs		(0.7)			(0.4)
Change in -
Accounts receivable and unbilled revenues, net		2.0			13.4
Materials, supplies, and inventories		14.2			6.5
Amounts recoverable from customers		(0.1)			1.2
Prepayments		1.6			0.9
Other current assets		(0.3)			-
Collateral on deposit		1.1			(8.1)
Accounts payable		(8.7)			(13.3)
Temporary LIFO liquidation credit		-			4.5
Accrued taxes		3.3			3.9
Customer credit balances		(4.0)			(2.7)
Amount refundable to customers		(0.6)			2.3
Other current liabilities		1.0			0.1
Other, net		(4.2)			(1.6)
Net cash provided by operating activities			24.7			23.7
Investing activities
Capital expenditures		(6.7)			(7.6)
Other, net		(0.2)			0.1
Net cash used in investing activities			(6.9)			(7.5)
Financing activities
Notes payable to related party, net		(10.6)			(26.2)
Equity contribution from parent		-			10.0
Payment of dividends to parent		(7.0)			-
Net cash used in financing activities			(17.6)			(16.2)
Net change in cash and cash equivalents		0.2			-
Cash and cash equivalents at beginning of period		0.2			-
Cash and cash equivalents at end of period		$	0.4		$	-
Supplemental cash flow information
Cash paid for interest		$	0.4		$	0.6